House of Lords

Monday 21st July 2025 Lords Chamber

Monday 21 July 2025

14:30

Prayers—read by the Lord Bishop of Newcastle.

Official Development Assistance

Monday 21st July 2025 Lords Chamber

Question

14:36

Asked by

[Lord Oates]

To ask His Majesty’s Government whether they have made an assessment of the likely impact of cuts to Official Development Assistance in the UK, United States of America and European nations on progress towards the United Nations Sustainable Development Goals.

[Lord Oates (LD)]

My Lords, I beg leave to ask the Question standing in my name on the Order Paper, and in doing so I declare my interest as chief executive of United Against Malnutrition and Hunger.

[The Minister of State, Foreign, Commonwealth and Development Office (Baroness Chapman of Darlington) (Lab)]

My Lords, we are committed to the sustainable development goals and to continue working with partners to accelerate progress by 2030. To do this, we are resetting our approach, moving from donor to investor and building modern, mutually beneficial partnerships to navigate global issues. Aid alone has never been enough, which is why at the conference on financing for development we pushed for tangible action on global finance system reform, including UK-led initiatives to unlock more private capital.

[Lord Oates (LD)]

My Lords, I thank the Minister for her reply. She will be aware that the cumulative impacts of cuts to development support around the world fundamentally undermine progress on the sustainable development goals, with devastating consequences for millions of people. In light of that fact, will she ensure that remaining UK development support is maximised by directing it through match-funding mechanisms with partner countries and philanthropies, by working with multilateral development banks to leverage their balance sheets to focus on the SDGs and by urgently addressing unsustainable debt servicing burdens on low-income countries?

[Baroness Chapman of Darlington (Lab)]

It certainly does present a challenge, as the UK and many other nations are making similar decisions about their ODA budgets. However, while it makes this more of a challenge, it does not mean that we give up, and the way that the noble Lord suggests that we direct our spend in future is pretty much what we are doing. We are focusing and pivoting more towards the multilateral system, because that is how you can leverage more funds and get better value and more impact in country, which we all want to see.

[Baroness Sugg (Con)]

My Lords, the Minister will know of my concern about the disproportionate impact that these cuts will have on women and girls. Will she agree to meet with me and a cross-party group of parliamentarians of both Houses who share my concern, when we return in September, to discuss working together to mitigate this?

[Baroness Chapman of Darlington (Lab)]

I would be very happy to meet with the noble Baroness, especially given her track record on this agenda. She will have noted that we intend to integrate and mainstream our work on gender, particularly through our work on humanitarian and health priorities, and she will note the appointment of my noble and learned friend Lady Harman as our envoy on women and girls. I suggest that my noble friend is included in our discussions too.

[Lord Watts (Lab)]

My Lords, does the Minister agree that the most effective way of helping countries is to try to extend birth control in countries that currently do not have that ability? Does she agree that, in a time when there is a shortage of resources, we should concentrate on that area?

[Baroness Chapman of Darlington (Lab)]

That is an incredibly important area to focus on. We have spent £60 million this year on the UNFPA and an additional £8 million on humanitarian family planning products because, as my noble friend says, this is such a vital issue. It can make such a difference to women and girls and to whole communities in places that really need the support.

[Baroness Northover (LD)]

My Lords, the US and the UK were major supporters of UNFPA, the UN Population Fund. The devastating cuts to USAID, coupled with the right-wing push-back on gender equality and family planning, leave the poorest women and girls in a desperate situation globally. Following on from the previous two questions, how will the UK prioritise helping them, given that we certainly will not reach the SDGs if we do not do that?

[Baroness Chapman of Darlington (Lab)]

I talked about money in my previous answers, but our commitment to be advocates and continue to push for a change in country on the rights of women and girls is often as important. Maintaining access to safe abortion and family planning advice and products is a key commitment from the Government that builds on the work of very many of my predecessors. This is absolutely vital and is one of the reasons that we have decided to prioritise health as we go forward.

[Lord Alton of Liverpool (CB)]

My Lords, given that conflict is one of the reasons why development is always impeded, has the Minister had a chance to look at the correspondence last week between the Foreign Secretary and the Joint Committee on Human Rights, where the Foreign Secretary was asked whether these cuts will impact the work we are able to do with the United Nations Human Rights Commissioner and UNICEF? He said that peacekeeping would not be affected, but he was unable to answer that question. Given the importance of holding to account perpetrators of terrible crimes from Ukraine to the Middle East, in Sudan, the Horn of Africa, Syria and so many other places, does the Minister agree that we must do nothing that reduces our expenditure on bringing perpetrators to account and our attempts to try to mitigate the worst effects of the terrible violence?

[Baroness Chapman of Darlington (Lab)]

I agree with that. We can be proud of the work that this country has done on conflict prevention, on demining and on many other areas connected to the issues he raises, not least accountability. But you only have to listen to the news coming out of Gaza this morning to be confronted with the fact that you can provide as much aid as you like—we have protected our aid to Gaza; we have aid waiting on the border—but the reason that those people are starving is because of political choice.

[Baroness Bennett of Manor Castle (GP)]

My Lords, antimicrobial resistance is a huge security threat to the United Kingdom, as well as a health threat and an economic threat. The noble Lord, Lord O’Neill, from these Benches, was commissioned by the Government in 2014 to conduct a review on AMR, and that led to the foundation of the Fleming Fund, which has now been killed off. In the other place, the Government said:

“While the Fleming Fund itself is not continuing, the partnerships, the information and the expertise are”.


Can the Minister help me to understand what that actually means, given we have killed a major institutional organisation, which has been genuinely world-leading in the field of AMR?

[Baroness Chapman of Darlington (Lab)]

I think those comments were made by the Minister for Public Health, Minister Dalton, at the International Development Committee last week. I would invite the noble Baroness to look at how we are focusing on function and not form. The decision from the Department of Health and Social Care, led by Chris Whitty, on research and development, is that the work and benefits of the Fleming Fund, which she quite rightly points out have been outstanding in its work on antimicrobial resistance, must continue. Much has been learned through the Fleming Fund, but it is right that we evolve that into other agencies so that we can get the benefit from that.

[Lord Herbert of South Downs (Con)]

My Lords, sustainable development goal 3.3 says that HIV, AIDS, malaria and tuberculosis must be beaten by 2030. On the current rate of progress, TB will not be beaten for 100 years. I was pleased to hear the Minister say that global public health will be prioritised. Will TB, within that, continue to be a priority for the Government? TB is an airborne infectious disease, and it is an entirely unnecessary loss of life that 1.5 million people a year still die from it.

[Baroness Chapman of Darlington (Lab)]

One could say the same about HIV and, to an extent, malaria. That is one of the reasons that the UK is now the largest donor to Gavi, the Vaccine Alliance. As we now understand only too well, these things not only have a hugely damaging effect on developing countries but can find their way here. The Prime Minister will co-host the replenishment of the Global Fund in South Africa in the autumn, and it is his job to announce a decision on that pledge. I will not do that today, but the noble Lord will see the concerns that he has aired reflected in that announcement.

[Lord Foulkes of Cumnock (Lab Co-op)]

My Lords, as a former Development Minister, I share the concern of the noble Lord, Lord Oates, and the noble Baroness, Lady Sugg, about the reduction of our development assistance. However, do the Liberal Democrats and Conservatives ever suggest what other areas we might cut to restore some of this funding?

[Baroness Chapman of Darlington (Lab)]

It would be a very strange former Minister for Development who would not regret a reduction in the budget—or any Minister in any department, because that is not what any of us is here to do. The Liberal Democrats prioritising certain budgets ahead of others is for them to answer, not me.

[The Earl of Courtown (Con)]

My Lords, on these Benches we are clear that the primary duty of any Government is to their own people and country. We will always view ODA in that context. A new Independent Commission for Aid Impact report projects that, by 2027-28, one-fifth of ODA will be spent on supporting refugees and asylum seekers in the UK. Does the Minister think this is money well spent? Can she take this opportunity to confirm how much of the ODA budget will be spent on the Government’s Chagos deal?

[Baroness Chapman of Darlington (Lab)]

ODA is not being spent on the Chagos deal, as the noble Earl should know; I have told him about four times. We inherited a situation in which about one-third of the ODA budget was spent on in-donor refugee costs, and I think that is disgraceful. I want to see that percentage reduced. The Home Office has reduced costs by around one-third over the last year, but ODA pays for only the first year of it, so they need to go a lot further to keep me happy—but, trust me, they are motivated.

Artificial Intelligence: Legislation

Monday 21st July 2025 Lords Chamber

Question

14:47

Asked by

[Lord Holmes of Richmond]

To ask His Majesty’s Government when they will publish their consultation on their plans for artificial intelligence legislation and when they expect any subsequent bill to be introduced.

[Lord Holmes of Richmond (Con)]

My Lords, I beg leave to ask the Question standing in my name on the Order Paper and declare my technology interests, as set out in the register. They include being a member of the global advisory board at Endava plc and a member of the science and technology advisory committee of the Crown Estate.

[The Minister of State, Department for Science, Innovation and Technology (Lord Vallance of Balham) (Lab)]

My Lords, the Government are preparing a consultation on AI legislation in order to gather views on the proposals. This would better prepare the UK for AI security risks, while making sure that our statute book is ready for the age of AI and its undoubted opportunities. The Government will update Parliament in due course.

[Lord Holmes of Richmond (Con)]

My Lords, I was rather hoping that we might have a consultation for our summer reading, but we will await the consultation and subsequent Bill. The Government have said that they will take a domain-specific approach to the legislation and regulation of AI, rather than cross-sector. To that end, how will consistency be assured through such an approach?

Similarly, what about areas that currently do not have any competent regulator, such as hiring and recruitment? People find themselves not being shortlisted for roles because AI has made that decision, without even knowing that AI was in the mix. Even if they knew that AI was in the mix, there would be no place to seek redress. Surely, clarity, certainty and consistency are what anyone in the country requires when it comes to AI, whether they are an investor, innovator, consumer or creative. How will a domain-specific approach, with no guiding mind, ensure that clarity, consistency and certainty?

[Lord Vallance of Balham (Lab)]

I am sorry that I disappoint the noble Lord with his summer reading list. I am happy to meet him to give him some other recommendations of good books.

As set out in the AI Opportunities Action Plan, we believe that most AI systems should be regulated by the existing regulators. They are the experts. They need the AI skills to be able to do it. The Government are working with regulators to drive collaboration and alignment across the regulatory domains through, for example, the Digital Regulation Cooperation Forum’s AI and digital advisory hub and the Regulatory Innovation Office, which is working with DRCF to collaborate on the support of the development of tools to help businesses and investors better navigate digital regulations.

We recognise the point the noble Lord has raised, which is that there are some aspects of AI that need to be looked at across AI generally. That is why we are undertaking consultation on legislation, and why we have ongoing work with all the departments around the impact on jobs that he described.

[Lord Clement-Jones (LD)]

My Lords, as long ago as February, the Minister’s Secretary of State said:

“AI is a powerful tool and powerful tools can be misused. State-sponsored hackers are using AI to write malicious code and identify system vulnerabilities, increasing the sophistication and efficiency of their attacks. Criminals are using AI deepfakes to assist in fraud, breaching security by impersonating officials”.


He went on to say:

“These aren’t distant possibilities. They are real, tangible harms, happening right now”.


If that is the case, why are the Government not taking a much more urgent approach to the introduction of regulation? I declare an interest as an adviser to DLA Piper on AI policy and regulation.

[Lord Vallance of Balham (Lab)]

I agree that this is an urgent issue, and it is changing day by day. The urgency is reflected in the work that has already taken place through the Online Safety Act, the Data (Use and Access) Act and, of course, the Crime and Policing Bill. But the need to get the legislation right for a more widespread AI Bill is important and has to be taken with due consideration. It would be very wrong to try to rush this. A consultation that brings in all the relevant parties will be launched, and that will be the time when we can make sure that we get this absolutely right.

[Viscount Colville of Culross (CB)]

My Lords, at the Bletchley AI safety summit, major AI companies, such as Google, signed a voluntary agreement that they would not release AI frontier models without a safety card explaining how they had been tested and by whom. However, in March this year, Google released its Gemini 2.5 model without such a safety card. Does the Minister agree that examples such as this only add pressure for AI models safety testing to be put on a statutory basis?

[Lord Vallance of Balham (Lab)]

We do agree that the issue of safety in AI is very important. That is why we formed the AI Security Institute, which is busy working with companies around the world, testing their models, bringing their models in, working out where the vulnerabilities are, working in a way that allows those companies to build in the safety requirements that are needed, and, importantly, working with other AI safety and security institutes around the world. They have between them formed a group that is looking at these very issues. This is something we will be very vigilant on. It is something the world needs to be vigilant on as these models rapidly advance.

[Viscount Stansgate (Lab)]

My Lords, I agree with my noble friend that it is important to get it right. But, in addition to the consultation, will it be the case that any future proposed Bill will be subject to pre-legislative scrutiny, to allow both Houses of Parliament to look in more detail at these very important issues?

[Lord Vallance of Balham (Lab)]

I thank my noble friend. The consultation, which is in the process of being developed, will need input from everybody. It is important that we get the right people looking at what this consultation needs. As that consultation rolls out, it will be important that we have very widespread engagement right across Parliament.

[The Lord Bishop of Newcastle]

My Lords, I am very pleased that Blyth in north-east England has been chosen as the site of a new AI data centre. This represents good investment in training and skills and in transport infrastructure. However, data centres have a lot of impact on the environment and local communities, particularly in terms of water shortages. What ongoing assessment has been done of the impact, particularly on water shortages in local communities?

[Lord Vallance of Balham (Lab)]

I thank the right reverend Prelate for that question. I gave quite an extensive Answer on water and AI last week. There are specific requirements for places that could host the new AI growth zones, including for the power supply but also, importantly, the ability to look at how water is used, the use of technologies to reduce water use, including recirculation and the types of chips that allow you to generate less heat during processing, and an obligation to work with water companies to come up with a clear, credible plan.

[Viscount Camrose (Con)]

My Lords, on 3 July, over 150 major EU businesses wrote to the European Commission seeking a pause on the rollout of the EU’s AI Act. They objected, among other things, to its rigidity, complexity, overregulation and threat to competitiveness. What do the Government make of these objections? Do they remain as keen as they were in opposition on close alignment with the EU on AI regulation?

[Lord Vallance of Balham (Lab)]

I think the noble Viscount is very well aware that we have taken a rather different approach, in that we are proposing regulation largely through the existing regulators rather than having everything in one place. We are now looking at an AI Bill that would go across; that is what the consultation will be about.

This is one of those areas where it is crucial to work with colleagues around the world. This is not a domestic but a global issue, and one that has to be dealt with with our colleagues in the US and in the EU. We will look very carefully at some of the features of the EU Act, which, as the noble Viscount rightly said, have been carefully looked at by a number of people, who found some things that I think the EU also wishes to change as it looks at its legislation. This goes back to my earlier answer: if we rush the consultation, we will get this wrong; if we take the time and do it right, we could end up having the best regulation in this area, which will none the less need to change, as this advances very rapidly.

[Baroness Kidron (CB)]

My Lords, both the AI Opportunities Action Plan and the industrial strategy outline a commitment to sovereign AI, including the creation of a UK sovereign AI unit, but with little detail about the timeline or the terms under which it will operate. Meanwhile, the Government continue to sign contracts with global AI firms across multiple government departments without reference to the concerns expressed in both Houses about the need to protect the UK’s valuable datasets. Could the noble Lord reassure the House that the UK’s very valuable public datasets will not be shared with international tech companies before Parliament has the opportunity to understand the terms on which they are being shared? Given that the Government have pushed back the timeline of the promised AI Bill, could he also explain how and when the details of what constitutes UK sovereign AI will be established?

[Lord Vallance of Balham (Lab)]

The noble Baroness will be aware that we have allocated up to £2 billion for AI, £500 million of which is on sovereign AI. That unit is just being established now. It will look at the features, which, of course, include data, hardware and software. One thing I can tell her, which I hope she will be pleased with, is that there is a programme on the creative content exchange in the creative industries sector that is specifically designed to look at how data from the creative industries can be pulled together so that it is easy to license it, easy to understand what has happened to it, and, therefore, easier to use it appropriately in an AI setting.

Weight Loss Medication

Monday 21st July 2025 Lords Chamber

Question

14:58

Asked by

[Baroness Stedman-Scott]

To ask His Majesty’s Government what plans they have to make weight loss medications available to people living with obesity who are unable to afford them privately.

[Baroness Stedman-Scott (Con)]

My Lords, in begging leave to ask the Question standing in my name on the Order Paper, I declare something of an interest, in that I have used them and they work.

[Baroness in Waiting/Government Whip (Baroness Blake of Leeds) (Lab)]

I look forward to the noble Baroness’s testimony. The obesity medicines Wegovy and Mounjaro are already available to eligible patients attending NHS specialist weight management services. In June, the NHS began making Mounjaro available through primary care. Around 220,000 adults will be considered for Mounjaro in the first three years, access being prioritised by clinical need. We are committed to expanding NHS access and will work closely with industry and local systems to identify innovative ways to do this.

[Baroness Stedman-Scott (Con)]

I thank the Minister for her Answer. Credit where it is due: achieving that number of people benefiting from weight loss jabs is absolutely terrific. I challenge the Minister—not her personally but the Government—to be a little more creative, in that there are people in this country who cannot work because of conditions resulting from obesity. If we added up the money we spent on government programmes and different drugs to compensate for that, and then looked at the cost of the drugs, we would see that it is worth a pilot scheme, to be a bit more creative; otherwise, we will know the cost of everything and the value of nothing. Will the Minister talk to our friend, the noble Baroness, Lady Sherlock, in the DWP to see whether we can get a pilot going?

[Baroness Blake of Leeds (Lab)]

I think it is fair to say that everyone knows how significant this is, not only the personal cost of not helping people, but the cost to the NHS, the economy and wider society. The truth is that around 3.4 million adults in this country could be eligible. From talking to ICBs, we know that rollout on that scale has to be taken very seriously so that the systems do not fall over. It is a priority. Other weight-loss methods are ongoing and will continue alongside, but it is something we will continue to work exceptionally hard to achieve.

[Lord Rennard (LD)]

My Lords, I too am a user of Mounjaro, and I also helped facilitate the introduction of continuous glucose monitoring into the NHS. Is it not a fundamental problem that the current process of the National Institute for Health and Care Excellence is far too short-term? It puts too much weight on short-term cost savings to the NHS and not enough on long-term analysis of the benefits to the economy and of things such as emotional well-being, which is priceless.

[Baroness Blake of Leeds (Lab)]

I completely concur with the noble Lord’s last comments. Issues around weight and food choices are exceptionally complex, but the impact on emotional health is enormous. We have to work with the systems and the life sciences sector to make sure that we do proper longitudinal studies that can help NICE in its decision-making process. I cannot comment on NICE’s procedures around this, but it is regarded as an absolute priority by everyone involved.

[Lord Watts (Lab)]

My Lords, should we ask the food industry, which is responsible for obesity, to pay a contribution so that we can extend this service?

[Baroness Blake of Leeds (Lab)]

My noble friend is right that there is a lot of attention on the food industry, and that is why so many programmes are now being targeted against advertising to children, et cetera. We will continue to work to make sure that that industry takes due regard of the impact of its products, and to do everything we can to improve regulation.

[Lord Balfe (Con)]

My Lord, one of the problems we have is that a number of medicines that are available privately are not available on the NHS. I am thinking in particular of medicines for prostate cancer. I happen to know that the DHSC is currently looking at a regime for them. Perhaps the Minister could look at the United States, where, at least in some states, there is a limit on the amount of profit that can be taken from privately supplying medicines—in other words, a costing regime—and also at whether the range of consultees on this matter could be slightly widened to include some noble Lords in this House who have been writing to the department for about six months now attempting to get a dialogue going.

[Baroness Blake of Leeds (Lab)]

The noble Lord is right that interest in this area from this House and the other House has been very high. I think it is because of the progress that has been made. Of course, everyone looks at practice, in this country and other countries, to inform how we work. There is no doubt that those who can afford to pay to have access privately are seeing a significant difference. We want to make sure that we move forward so that the treatment is available for everyone.

[Baroness Boycott (CB)]

My Lords, I think everyone welcomes the advent of these drugs for people who have serious weight problems, but what happens when they come off them, and what are the Government doing to ensure that we have a much healthier diet available to people of any income, wherever they are? Quite frankly, if your diet becomes one Coca-Cola and one hamburger rather than five times that, it will not fix your health in the long term. It might get your weight down, but you will still be, essentially, a malnourished human being.

[Baroness Blake of Leeds (Lab)]

There is no doubt that, when these injections are working alongside other weight management approaches, including education around diet generally as well as exercise, the chances of success on all the issues that the noble Baroness raises are far greater. We need to understand the longer-term impacts of being on these drugs—whether it will be safe for people to be on them for longer. We need to understand the challenges as well as the opportunities. There are opportunities coming forward for other areas of medicine from the use of these drugs.

[Lord Kamall (Con)]

My Lords, I want to follow up on what the Minister has just said and the previous question from the noble Baroness. As we have heard from the personal testimonies of noble Lords, these medications have the potential to reduce obesity and the long-term cost to taxpayers. Unfortunately, a recent study by the MHRA has found that a group of these drugs, including Mounjaro, Wegovy and Ozempic, may be associated with health problems such as inflammation of the pancreas.

Given that, and some of the previous questions, first, what assessment of the long-term impact on health have the Government made of these weight-loss medications? What data do they have as of now, and what data are they waiting for? Secondly, as the noble Baroness, Lady Boycott, said, how do we ensure that, when patients come off these medications, they do not just put all the weight back on? How do we make sure that they are part of a wider programme to keep the weight off?

[Baroness Blake of Leeds (Lab)]

Quite a few points were made there. I think the noble Lord is referring to reports about acute pancreatitis, for example. The MHRA has done a thorough review of the suspicions around these medicines. No new safety concerns were identified but, every time something comes up, it will be looked into. The noble Lord is absolutely right that we need to support the longitudinal studies that are happening, but going on beyond the initial licensing will also be critical. As I answered previously, work in other areas to encourage healthy lifestyles will be ongoing, and this will need to be taken seriously by patients from a very young age.

[Lord Winston (Lab)]

My Lords, the causes of obesity are many, not just one or two issues. Has my noble friend the Minister considered whether some sort of pilot programme looking at particular types of obesity might be sensible, just as the questioner has, in effect, already asked? I agree that the long-term effects are really important and must not be forgotten.

[Baroness Blake of Leeds (Lab)]

My noble friend raises an important point. I would not stand at the Front Bench and counter what he has said. I will be very happy to pick up his ideas after this session and look at all the innovative ways in which we can take future work forward.

[Lord Forsyth of Drumlean (Con)]

I congratulate the noble Lord, Lord Watts. For once I find myself in complete agreement with him. Is he not right in saying that we should be tackling the causes not the symptoms, and that the causes lie with food manufacturers, which deliberately produce products that are addictive and processed, and form the cheaper foods diet of people in our country? The time has come to take action other than just trying to prevent advertising to children.

[Baroness Blake of Leeds (Lab)]

I am delighted to hear the intervention from the other Benches. This is something to be welcomed. Obesity is complex. I would not like to stand here and put it down to one cause. There are multiple causes, as we heard earlier, around mental health and so many other issues. Everything needs to be on the table. It is a serious issue, costing this country, and other countries around the world, dearly. We need to look at every possible outcome.

NHS England: Staff Costs

Monday 21st July 2025 Lords Chamber

Question

15:09

Asked by

[Lord Scriven]

To ask His Majesty’s Government what impact assessments have been undertaken, including analysis of regional effects, regarding the 50% reduction in staff costs for NHS England that is currently in progress.

[Baroness in Waiting/Government Whip (Baroness Blake of Leeds) (Lab)]

My Lords, work is progressing at pace to develop the operating model for the future department. I can confirm that there will continue to be seven regional teams. It is only right that the potential impacts of the reforms are carefully assessed and understood. The Government are committed to ensuring that, once the necessary appraisals are finalised, all relevant information is made accessible to Parliament. This includes the impact assessment that will accompany the primary legislation.

[Lord Scriven (LD)]

My Lords, in the absence of any assessment, including the work that NHS England does on health inequalities, coupled with last week’s decision to cut £100 million of support from five integrated care boards, three of which serve highly deprived areas, on what basis can the Minister guarantee that this course of action will not jeopardise efforts to reduce health inequalities or indeed risk widening them further?

[Baroness Blake of Leeds (Lab)]

Tackling health inequalities is one of the priorities of this Government, but the noble Lord raises an important point. It is a sad fact that, around the country, people’s experience of health services and health outcomes are very variable. However, we need to allow the people looking into this to do their work and bring forward solutions, working with ICBs and looking at how we can become far more efficient in our delivery of services. That will ultimately have an enormous benefit to patients.

[Lord Kakkar (CB)]

My Lords, I draw noble Lords’ attention to my registered interest as chairman of King’s Health Partners. At the time when the decision was taken for NHS England to be fully incorporated into the Department of Health and Social Care, two other important agencies were completing their incorporation into NHS England—namely, NHS Digital and Health Education England. The functions of those two agencies in marshalling NHS data and its analysis and in providing for the continuing development of the NHS workforce are critical. Is the Minister able to confirm how those important functions are being protected during this period of transition of NHS England into the department?

[Baroness Blake of Leeds (Lab)]

The noble Lord, as always, raises exceptionally important points. The three shifts under the 10-year plan, particularly around moving from analogue to digital, answer the question on the need to focus on digital. These are ongoing discussions and, while the workforce will come down, it is critical that work is allowed to be done to assess what needs to be done and how we can move the health service, and therefore health outcomes, forward in the most productive and successful manner.

[Baroness McIntosh of Pickering (Con)]

My Lords, have the Government ever undertaken an audit of the NHS estate—for example, in York and North Yorkshire—to see whether there are a number of redundant buildings following successive reorganisations of the NHS? If it were to emerge that some of these buildings were redundant, would the Government be minded to sell them off and raise money for the NHS in that way?

[Baroness Blake of Leeds (Lab)]

The point that the noble Baroness raises is not a new one. As anyone from the local government sphere will know, there are always ongoing conversations about the estate, where it lies, its ownership and how we can move it into the future, and I do not think anything has changed. What we know is that, through these changes, the alignment of public services is going to be fundamental. The use of buildings is a vexed issue across the public sector and will need to be on the table.

[Lord Hunt of Kings Heath (Lab)]

My Lords, to come back to the Question from the noble Lord, Lord Scriven, about an impact assessment, does the Minister think it might be a good idea to do an impact assessment of NHS England itself, which both the parties opposite forced through in 2011, at a cost of £3.5 billion? As a result, waiting times increased, staff disenchantment increased and patient satisfaction went down. Should we not have an impact assessment on that?

[Baroness Blake of Leeds (Lab)]

My Lords, the evidence for that is becoming only too clear. That is why the Government have taken the action that they have to move at pace towards dealing with the situation. Too much money is going into bureaucracy and therefore not enough into front-line services. That needs to change, and this has been welcomed from all sides of the House.

[Lord Kamall (Con)]

My Lords, following the previous questions, I am sure that many noble Lords would agree with reducing staff, especially where there is duplication or where it may make more resources available for front-line staff. However, given that there was no impact assessment before the announcements were made—as the noble Lord, Lord Scriven, said, and as the noble Lord, Lord Hunt, has called for—will the Minister tell the House how the Government will ensure that front-line services will not be impacted, especially in areas of high deprivation?

[Baroness Blake of Leeds (Lab)]

There is an absolute commitment running throughout this that front-line services will not be affected by the work that continues. The decision was taken to move swiftly, and impact assessments will be done as we go through the journey. The Government have also committed that this will be as transparent a process as possible. Parliament will be kept fully apprised of the work that is done, particularly of how front-line services are being protected.

[Lord Young of Norwood Green (Lab)]

My Lords, it has been decided that it is no good just throwing more money at the NHS; you have to reform it at the same time. Is that not an important factor—the need to reform the NHS, making sure that it provides better services, rather than just thinking that more money is the answer to the problem, when we know that this has not been the case in the past?

[Baroness Blake of Leeds (Lab)]

I think my noble friend is referring to the layers of bureaucracy that make up NHS England. Anyone trying to find a way through that bureaucracy struggles to have direct lines of accountability, for example. He is absolutely right: reform is essential. This Government have grasped the nettle and are moving forward and working at pace, bringing in all the senior people from all the different affected parties to work together and, most importantly, to keep Parliament apprised of progress.

[Lord Polak (Con)]

My Lords, the Question was about the 50% reduction in staff costs in the NHS. Has the Minister or her department discussed this with resident doctors, who, shamefully, will apparently have plenty of spare time to give their advice?

[Baroness Blake of Leeds (Lab)]

We made a Statement just last week on the situation with resident doctors, and we make absolutely no bones about saying that we do not approve of the action they are taking. We have to work together to make sure that NHS England moves forward and merges with the Department of Health and Social Care. The 50% is not a definitive decision; it will be done based on need and delivery of services.

[Lord Grocott (Lab)]

My Lords, I was very taken with my noble friend Lord Hunt’s forensic analysis of the coalition Government’s performance on health. He mentioned the £3.5 billion figure. I know that my noble friend the Minister is not able to respond to that now, but would it not be very useful and enlightening for us all if we knew precisely how much money was wasted by the coalition Government at that time?

[Baroness Blake of Leeds (Lab)]

I can only say that the ongoing forensic work will uncover what has happened over the past few years, but I think we all know that, at the moment, the NHS is not fit for purpose; there needs to be radical change. This Government are absolutely committed to that, and we will make sure that it happens at pace and safely, putting patients front and centre in the delivery of health services in this country.

[Baroness Hussein-Ece (LD)]

To return to the Question from my noble friend Lord Scriven on health inequalities and how they might be impacted by the proposed changes, will the Minister please reassure us that the widening health inequalities that we know exist around the country will not get worse, particularly for the most vulnerable and those with learning disabilities, whom we know face tremendous access problems? There have been numerous studies on how accessing primary healthcare is a real challenge for those with learning disabilities. Can she reassure us that that will not be dropped?

[Baroness Blake of Leeds (Lab)]

My experience of the Covid virus taught me about the impact of health inequalities and where people suffered the most. It is absolutely imperative for this Government to look at health inequalities, and everything in the 10-year plan is based on that premise. We know how unequal services are and how unequal life expectancy is. We know that people living just a few miles down the road from others in the same city can have a more than 10-year difference in life expectancy. This is absolutely at the centre of the 10-year plan and why we are doing it and will deliver for patients in this country.

Royal Assent

Royal Assent
Monday 21st July 2025 Lords Chamber

15:20

Royal Assent was notified for the following Acts:

Supply and Appropriation (Main Estimates) Act,

Product Regulation and Metrology Act,

Football Governance Act,

Norwich Livestock Market Act.

Waste Electrical and Electronic Equipment (Amendment, etc.) Regulations 2025

Monday 21st July 2025 Lords Chamber

Motion to Approve

15:21

Moved by

[Baroness Hayman of Ullock]

That the draft Regulations laid before the House on 4 June be approved.

Relevant document: 29th Report from the Secondary Legislation Scrutiny Committee. Considered in Grand Committee on 15 July.

Motion agreed.

Armed Forces Act 2006 (Continuation) Order 2025

Monday 21st July 2025 Lords Chamber

Motion to Approve

15:22

Moved by

[Lord Coaker]

That the draft Order laid before the House on 9 June be approved.

Considered in Grand Committee on 15 July.

Motion agreed.

Online Safety Super-Complaints (Eligibility and Procedural Matters) Regulations 2025

Monday 21st July 2025 Lords Chamber

Motion to Approve

15:22

Moved by

[Baroness Jones of Whitchurch]

That the draft Regulations laid before the House on 9 June be approved.

Relevant document: 29th Report from the Secondary Legislation Scrutiny Committee. Considered in Grand Committee on 15 July.

Motion agreed.

Legislative Reform (Disclosure of Adult Social Care Data) Order 2025

Monday 21st July 2025 Lords Chamber

Motion to Approve

15:22

Moved by

[Baroness Anderson of Stoke-on-Trent]

That the draft Order laid before the House on 21 May be approved.

Relevant document: 26th Report from the Delegated Powers and Regulatory Reform Committee. Considered in Grand Committee on 16 July.

Motion agreed.

Electricity Capacity (Amendment) (No. 2) Regulations 2025

Monday 21st July 2025 Lords Chamber

Electricity and Gas (Energy Company Obligation) (Amendment) Order 2025

Motions to Approve

15:23

Moved by

[Lord Wilson of Sedgefield]

That the draft Regulations laid before the House on 3 and 11 June be approved.

Considered in Grand Committee on 16 July.

Motions agreed.

House of Lords (Hereditary Peers) Bill

3rd reading
Monday 21st July 2025 Lords Chamber

Third Reading

15:23

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

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

Amendment 1

Moved by

[Baroness Smith of Basildon]

1: After Clause 3, insert the following new Clause—
“ResignationIn section 1 of the House of Lords Reform Act 2014 (resignation), after subsection (4) insert—“(5) Where a notice under this section is given and signed by a person on behalf of a peer who lacks capacity to give or sign the notice, the notice must be given and signed in accordance with Standing Orders of the House.””Member’s explanatory statement
This amendment inserts a new clause which makes clear that a notice under section 1(1) of the House of Lords Reform Act 2014 may be given and signed on behalf of a peer who lacks capacity; and which provides that such a notice must be given and signed in accordance with Standing Orders of the House.

[Baroness Smith of Basildon (Lab)]

My Lords, I will speak to Amendments 1 to 4 and 6. In Committee and on Report, the House considered amendments tabled by the noble Lord, Lord Ashton of Hyde, regarding the sensitive matter of allowing Peers who lack capacity to be able to retire through a power of attorney. On Report, the noble Lord agreed to withdraw his amendment so that we could consider and discuss the issue further ahead of the debate today.

I am grateful to the noble Lords, Lord Ashton of Hyde and Lord Pannick, the noble and learned Lords, Lord Garnier and Lord Hope of Craighead, and the noble and learned Baroness, Lady Prentis, for meeting me after Report to discuss this issue. I also thank the noble Baroness, Lady Browning, who has engaged with me on this issue, which many of us have personal experience of and feel passionately about. As I have said throughout, I think we are all trying to get to the same place on this matter and there is agreement across the House on the position that Members who lose capacity should be able to retire from your Lordships’ House with the dignity they deserve.

As I noted in previous debates, after becoming Leader I formally raised this matter with the Clerk of the Parliaments and sought my own legal advice. I had discussed this already with a number of noble Lords, the usual channels and the Clerk of the Parliaments. Following the debate in Committee, where I was grateful for the support across the House, I committed to continue to pursue this and, as a result, a solution was agreed by the Procedure and Privileges Committee. The Clerk of the Parliaments confirmed that he would accept a notice of resignation or retirement submitted to him by a person acting on behalf of a Peer who had lost capacity where that person holds either a lasting power of attorney covering property and affairs, executed under the Mental Capacity Act 2005, or an enduring power of attorney made prior to the 2005 Act.

Following discussions with noble Lords and the debate on Report, it became clear that the view of the House was that it would be preferable to find a solution in statute that would put it beyond doubt that Peers who lack capacity are able to retire via power of attorney. Any solution would also need to ensure that the current position of the clerk could not be reversed in the future.

I as Leader, and we as a House, have a duty to get this right. On Report I committed to engage in further discussions on the issue, and I believe that the amendments tabled in my name now present a solution that will satisfy the concerns raised in previous debates.

I will briefly outline the position for the House. Amendment 1 in my name makes clear that a notice under Section 1(1) of the House of Lords Reform Act 2014 may be “given and signed” by a person acting on behalf of a Peer who lacks capacity, and it provides that such a notice

“must be given and signed in accordance with Standing Orders of the House”.

It would then be for the Standing Orders and any associated guidance in the Companion, both of which will be subject to the approval of the Procedure Committee and then the House, to set out how these arrangements are to operate in practice. That of course will be subject to further work and discussions that I hope will start over the Summer Recess so that the Standing Orders and the guidance are in place as soon as possible. I would expect them to include the details of sorts of instruments under which the clerk would accept a notice of resignation on behalf of a Peer, the requirements on a person when submitting a notice of resignation on behalf of a Peer and the steps to be taken when that notice is received. I will of course consult noble Lords who expressed interest in the area, including those who signed the amendment from the noble Lord, Lord Ashton, and the usual channels.

I am very grateful for the support across the House for these amendments. I think these are the only amendments to the Bill to have attracted the support of all the usual channels, and I am grateful for that. This approach aims to provide the certainty that noble Lords have sought on this issue, but it also reduces the risk of wider ramifications for the existing legal framework on capacity and powers of attorney. To return to a subject I have raised before, it also gives the House ownership of the details of these arrangements, allowing us to make modifications as and when required. This is so that the House can remain agile and responsive to ensure that they remain workable, particularly in the event of any future changes.

In resolving this issue and providing legal clarity, I have decided to table amendments to make alterations to the commencement provisions in the Bill. This is to ensure that the families of Peers who wish to avail themselves of these new arrangements do not have to wait until the end of the parliamentary Session. As a result, as we have seen from Amendment 3, I now intend for the Bill to come into force on Royal Assent, specifically and only in relation to the amendments I have tabled on power of attorney. The other substantive provisions of the Bill will commence as planned at the end of the parliamentary Session in which it receives Royal Assent.

I thank noble Lords again for working constructively on this issue. I have listened to the House’s views on this important issue at every point to seek to find a solution. In Committee, I listened, acted and brought forward a solution and, on Report, I listened again. I feel that this amendment provides the certainty and durability that the House was seeking. I beg to move.

15:30

[Lord Ashton of Hyde (Non-Afl)]

My Lords, I am grateful to the noble Baroness the Leader of the House for coming up with and discussing this elegant solution, and for moving Amendment 1 and speaking to the consequential amendments, all of which I fully endorse. They will be much more comprehensive than my original amendment as soon as the detail has been addressed in the Standing Orders, and there will be a resolution to the problem that faced all parties and groups in the House. In her speech, she acknowledged and took into account the views of the House. By using Standing Orders to supply those details, the House will be given a chance to take a view on their merits, and they can be changed relatively easily if necessary—for example, if the power of attorney regime changes in the future.

I also thank the noble and learned Lords, Lord Garnier and Lord Keen, the noble and learned Baroness, Lady Prentis, and the noble Lord, Lord Pannick, for their assistance and advice. In thanking the Leader, I note, as I am sure has not escaped her notice, that the only Back-Bench amendment to the historic House of Lords (Hereditary Peers) Bill subsequently adopted by the Government was initiated by a hereditary Peer—not an important fact, I admit, but perhaps a footnote to a footnote in history.

[Lord Pannick (CB)]

My Lords, I added my name to Amendment 1 because it provides the best solution to a sensitive problem. There is, at present, uncertainty as to whether noble Lords who lack capacity can resign from the House. A legislative provision is required to remove this uncertainty, but the risk with legislation on this complex topic is that it may fail to capture all the relevant criteria and would then be very difficult to amend. The neat solution adopted by Amendment 1 is to provide statutory authority for Standing Orders of this House to regulate the matter. The complexity of the issue remains, but it can be addressed in detail in the drafting of the Standing Orders and with the assistance of the expertise in this House—you can never have too many lawyers. I am very grateful to the noble Baroness the Leader of the House for responding speedily and effectively, with the considerable assistance of the Bill team, on this important issue raised at earlier stages, as he has said, by the noble Lord, Lord Ashton of Hyde.

[Lord Hope of Craighead (CB)]

My Lords, I pay tribute to the noble Baroness the Leader of the House for all the work that she and those in her office have been doing over many months to find a solution to this problem on behalf of the families of Peers who lack capacity. I know that it is the families that she has particularly in mind, and they certainly deserve our careful thought. The solution which has been adopted is an agile one, as has been said, which means that the House has ownership of the drafting of the Standing Orders and the mechanisms that are necessary. As it happens, it is exactly the kind of solution that the Supreme Court found for itself in 2009. It was provided with a set of rules which could be altered only by statutory instrument, and it decided instead to resort to practice directions of its own devising, which are flexible and can be changed as circumstances require. So, the mechanism is ideal and very much to be welcomed.

I particularly welcome Amendment 3, which characterises the thoughtfulness of the noble Baroness. It means that the measure will come into force on the passing of this Bill and we will not have to wait until the end of the Session, which is surely absolutely right. Our thanks go particularly to the noble Baroness for the work she did long before the noble Lord, Lord Ashton, brought forward his amendment.

[Lord Garnier (Con)]

My Lords, in endorsing what the noble and learned Lord has just said, I think it would be remiss to allow my noble friend Lord Ashton to hide behind his natural diffidence. Without him, this would not have happened; we owe him a great debt, as do the families of those Peers who may wish to make use of this provision in future. Of course, I thank the noble Baroness the Leader for her assistance in this matter. It is regrettable that this looks as though it is the only amendment to this Bill which will survive to Royal Assent. However, at least it is a good amendment that we can all celebrate.

[Lord True (Con)]

My Lords, I put my name to this amendment. I underline the thanks that have been expressed to all the various people mentioned, including the lawyers, who have played a very important part.

As has been said, the noble Baroness the Leader tried very hard over a long period to find an appropriate and successful solution to this. Many people, including my noble friend Lord Ashton of Hyde, the noble Lord, Lord Pannick, and others, felt it was safer to have a legislative underpinning. She has accepted that and put a very constructive amendment to the House. I thank her for that. I also thank her for the firm and clear assurance she gave on Amendment 3. Since I may not have another occasion—I have not had much engagement with them—I also thank the Bill team for their work; some of their faces are quite familiar to me, and I know they will have given great service to the Government.

It would have been good to see other minor incremental changes made to the Bill, and there were some ideas floated. Let us hope that we can find some other occasion to take those things forward. In the interim, I am very happy to have associated my name with this amendment, which carries the support of your Lordships on this side of the House.

[Lord Parkinson of Whitley Bay (Con)]

My Lords, the other amendment in this group, Amendment 5, is in my name. It is a small change, consequential to the amendment your Lordships made during our first day on Report. Since the Bill now seeks to abolish the system of hereditary by-elections and to let those who currently sit in the House leave in the same manner as the rest of us—by one of the routes set out in the House of Lords Reform Act 2014, or by some far higher authority—Amendment 5 changes the requirement in Clause 6(4) for their Writ of Summons to expire at the end of the Session, as originally proposed.

I am very grateful to noble Lords—temporal and spiritual—from all corners of the House who supported this change to the Bill. I believe it is consistent with the Government’s manifesto commitment. As well as being kinder and less abrupt, it is consistent with the ways that we have treated other groups of noble Lords who have had their time in this House brought to an end: the Irish Peers in the 1920s and the Law Lords after 2009.

I thank the Leader for her support and echo the comments made about the amendment on power of attorney. It is often awkward for those of us in this House to debate the composition of our House or to confront the consequences it has for our Members, but she has been clear throughout in her praise for the public service given by our hereditary colleagues over many years. I thank her for saying that throughout and for the consensus she has achieved on the amendments she has brought today. It is a very good thing that an amendment is going to the other place bearing not just her name but those of my noble friend Lord True and the noble Lords, Lord Newby and Lord Pannick. I hope we might be able to find some further areas of consensus still, but I am grateful for this one.

[Baroness Smith of Basildon (Lab)]

My Lords, I am grateful to those who have spoken. It is good we have found an elegant solution—I have rarely been accused of being elegant, but I am happy to take it on this occasion—to a problem we all recognise. It is better in statute, as the noble Lord said. I say to the noble Lord, Lord Parkinson, that I did not realise there had been an awkwardness in the House about discussing measures in this Bill. It did not feel awkward at the time, but I think I know what he means. I am very grateful to all noble Lords who have supported my amendments—particularly the Leader of the Opposition, who has added his name, and others. In that spirit, I beg to move.

Amendment 1 agreed.

Clause 6: Extent and commencement

Amendments 2 to 4

Moved by

[Baroness Smith of Basildon]

2: Clause 6, page 3, line 2, after “section 1” insert “, (Resignation)”
Member's explanatory statement
This amendment is consequential on the amendment in my name inserting a new clause after clause 3.

3: Clause 6, page 3, line 5, at end insert—
“(2A) Section (Resignation), this section and section 7 come into force on the day on which this Act is passed.”Member's explanatory statement
This amendment provides that the new clause inserted by the amendment in my name inserting a new clause after clause 3, as well as the clauses dealing with extent and commencement and the short title come into force on the day on which the Bill is passed.

4: Clause 6, page 3, line 6, leave out “This Act comes” and insert “The other provisions of this Act come”
Member's explanatory statement
This amendment is consequential on the previous amendment to this clause in my name.

Amendments 2 to 4 agreed.

Amendment 5

Moved by

[Lord Parkinson of Whitley Bay]

5: Clause 6, page 3, line 8, leave out subsection (4)

Amendment 5 agreed.

In the Title

Amendment 6

Moved by

[Baroness Smith of Basildon]

6: Title, line 2, after “Lords;” insert “to make provision about resignation from the House of Lords;”
Member's explanatory statement
This amendment, which amends the long title, is consequential on the amendment in my name inserting a new clause after clause 3.

Amendment 6 agreed.

15:39

Motion

Moved by

[Baroness Smith of Basildon]

That the Bill do now pass.

[Baroness Smith of Basildon (Lab)]

My Lords, the other place admitted the Bill to this House for our scrutiny in December of last year. Since then, we have spent eight days—nine including today—considering the legislation, which is a total of over 51 hours of scrutiny. A total of 146 amendments were tabled in Committee, with 124 debated and a further 36 tabled on Report. The Government, including myself, are grateful for the debates we had on the Bill. I particularly thank the usual channels for the collaborative effort on the amendments relating to resignation, which we have just had, and regarding the power of attorney, as well as a number of other Members—too many to go through by name—who contributed to the wider debate on reform of this House.

With regard to progressing further reform of your Lordships’ House, I have already spoken about my intention to establish a dedicated Select Committee on the issues of retirement age and participation, and the impact that would obviously have on the size of the House. I look forward to progressing those issues following the passage of this Bill.

Throughout the passage of the Bill, I have been ably assisted by a first-rate Bill team and other officials behind the scenes. I thank them for their hard work in helping me, my noble friend Lady Anderson of Stoke-on-Trent, the noble Lord, Lord Collins of Highbury, and my noble and learned friend the Attorney-General, who stood at this Dispatch Box. I am also grateful to the number of noble Lords who, over several months—even before the Bill came to your Lordships’ House—met me both privately and in small groups to discuss issues about which they had particular concerns or suggestions they had for the Bill.

A number of noble Lords have followed the journey of this Bill from the beginning, and it has been quite a journey. It will now go to the other place with amendments, as the noble Lord, Lord Parkinson, said, and will no doubt return to our House for further review. It is my hope that we will deliver on the Government’s manifesto commitments on this Bill and see legislation on the statute book as soon as possible. I beg to move that the Bill do now pass.

[Lord True (Con)]

My Lords, I thank the noble Baroness the Lord Privy Seal for her emollient words. I hope very much that in the time that elapses between now and our return in September careful thought will be given by the Government and the other place to the merits of the amendments and debates in your Lordships’ House. I hope the Government will think positively, even if not in the context of this Bill, about proposals from your Lordships that all Ministers in your Lordships’ House be paid and that we reaffirm the right of the monarch to create peerages that do not require the holder to sit in this place; those ideas are worth taking forward.

For my own part and, I venture to suggest, in the hopes of many other noble Lords, I would like to think that the joint amendment on power of attorney could be the symbol of other accords that might be reached as this reform goes forward. I remain committed to the principles I set out at the beginning of Committee, which include—along with a more reasonable attitude to those of our colleagues who have long sat among us—a voluntary understanding to address the perceived issue of numbers, and a reinforcement of the conventions on the conduct of this House and its relations with the other place. That would liberate this House from the unnecessary late nights that no one here enjoys. I hope that will still be possible, for without the fullest trust, respect and good will between the Government of the day and His Majesty’s Opposition—and I value the candour and friendship of the noble Baroness the Leader of the House—this House cannot function. The brutal reality is that the full exclusion of over 80 Peers does not evidence full respect and cannot be the basis of full good will.

Be that as it may, in asking my colleagues to agree that the Bill do now pass—which I know many on this side in their hearts regret—I invite the whole House to assent to the principle that no person should again enter this House to any degree by right of heredity. That has long been the professed wish of Labour and Liberal Democrat Benches.

My only regret now is that it has not been accompanied, as was promised in honour in 1999, by properly worked-out proposals for reform. The British people have never been asked to assent to an all-appointed House in perpetuity. This Bill, as presented, would have left, along with a sprinkling of Bishops, a House of life Peers created by a statute passed as recently as 1958—an all-appointed House, which is almost unique in the world. No other liberal democracy would long tolerate that a Prime Minister of whatever party—even one such as that of Mr Farage, which is not yet represented here—should have full control of the numbers and people sent here. Add to that the untrammelled power to purge and throw out Members of the sitting legislature. Such a constitutional settlement could not, and should not, long endure.

15:45

With the passing of this Bill—it will indeed pass in a moment—there also pass eight centuries of English history and centuries of the history of all parts of our kingdom. It is right to refer to that, because in those centuries much that was good and great—and, in the widest sense, noble—was accomplished, from the curtailing of the absolute power of the monarchy in medieval times and through the Glorious Revolution to modem initiatives such as that of my noble friend Lord Arran’s father in the first freeing of gay people from the shameful, odious penal laws in 1967.

It was then a different building, but it was here, as Prime Minister, that the first Duke of Wellington carried Catholic emancipation in 1829. It was here, as Prime Minister, that the first Earl Grey carried the Great Reform Bill. For centuries until now, in this place hereditary Peers of all parties and none came with a high and unfailing sense of duty to serve and give good counsel to the fullest of their abilities. We see that same spirit here today in so many of our friends and colleagues. We should honour them and ever remember their great achievements.

It was a forbear of my noble friend Lord Effingham who led our resistance to the Spanish Armada. It was a Member of this House, Viscount Nelson, who fell in his country’s service at Trafalgar. It was the grandson of a Duke—Sir Winston Churchill—who stood at that Dispatch Box and rallied our country in the darkest days of the war. Indeed, it was at that same Dispatch Box that the grandfather of my noble friend Lord Attlee stood and carried the case for the creation of the NHS, to which my noble friend is a living memorial.

In our full and final removal of hereditary succession from this place, let us not turn our backs on what the principle of heredity and family have meant, and must always mean, in our society and every healthy society. It is to create, assist and bequeath to the children who come after them that millions of working families go out each day to strive and toil. It is from good parents that millions of young people across the generations learn their skills and values. Heredity is part of who we are and what we strive to be.

The Labour Party has won. No hereditary Peer will ever again take their oath at this Dispatch Box. However, I submit that it is not necessary, on top of that, to wield the brutal axe on our colleagues who sit here now. That is what the amendment passed by your Lordships’ House for grandfather rights asks the Government to moderate. There is a chance—and a choice—to temper historic victory with a magnanimity in that victory. Such a statesmanlike choice would benefit this House in keeping the Members whom we value and, at the same time, unleash a spirit of good will that could carry us all together through the rest of this Parliament.

[Lord Newby (LD)]

My Lords, the Bill, which has occupied 51 hours of your Lordships’ time, is exceptionally short. It has occupied that much time because it has been used as an opportunity to discuss virtually every possible aspect of the future composition and powers of your Lordships’ House.

As those unfortunate enough to hear my contributions will know, we have argued consistently that this should be an elected House, a move which would deal, in one fell swoop, with the worry of the noble Lord, Lord True, about the excessive power of the Prime Minister in his or her ability to create new Peers. Sadly, your Lordships’ House did not agree with me and those on our Benches on broader reform. However, it has already done one useful bit of tidying up with the agreement reached on the power of attorney.

It has also demonstrated—helpfully, I think—a fairly considerable degree of consensus on what are likely to be the next elements of reform; namely, the need to have a retirement age and to set at least low bars in terms of participation. Having heard the arguments on those issues and discovered that there is a very considerable degree of agreement about the principles of them, I think the noble Baroness’s proposal for a Select Committee is timely. But we must not let grass grow under our feet. It is important both that this committee is established and that it works with a set timetable, bringing forward proposals to your Lordships’ House, so that we can be invited to agree on them, in the near future. There are many good things about your Lordships’ House, but other things were exposed and debated at some length during the debate, and we have it in our power to deal with some of those quite quickly. For the good of the House and for the good of democracy, we need to get on with it, and from these Benches, we look forward to playing our part in doing so.

Finally, I have been guided through the shoals and perils of the Bill by Elizabeth Plummer in our Whips’ Office, without whom I may well not have retained what sanity I have. I am extremely grateful to her.

[The Earl of Kinnoull (CB)]

My Lords, the rest of the Bill and ping-pong will play out in September, I suppose, but I add my voice to those saying that the most valuable thing that will come out of the Bill is the committee which will consider the further reforms. For my part, I want the committee to go wider and deeper. I know that the noble Baroness our Leader would prefer it to be a bit narrower in order to get things through in a reasonable time. The committee will be a vital workstream for us, which I hope will produce quite a few ideas around which consensus will be built. It is very good that we have already had the first of those ideas: the power of attorney one that was discussed earlier on. I hope further—this is the depth of the committee—that it will bring forward mechanisms to move the ideas from things that are talked about to things which will represent real change to our House, which we have so long wanted.

[Lord Strathclyde (Con)]

My Lords, at Second Reading I called the Bill a “nasty little Bill” because it failed to seek any kind of consensus on a serious reform of the House and failed to advance an important constitutional matter with cross-party agreement. But the bricks with which to build that consensus still exist. The Bill leaves your Lordships’ House today amended—fairly, moderately and sensibly—so I wish it well. I hope the mood of friendly consensus continues, and that the other place will give our proposals the consideration they deserve, although I must admit that it is not easy to accept that my time here is nearly over.

We all accept the mandate that the Government have to end the involvement of the hereditary principle as a route of entry to our House, but I join my colleagues on all Benches who are still wondering why those of us already serving here are due to be flung out. I look at the noble Earl the Convenor of the Cross Benches, my noble friends Lord Howe and Lord Courtown, and the myriad Members who still give so much service to the House. Even on the Liberal Democrat Benches, the noble Viscount, Lord Thurso, who is not here, sadly, and the noble Lord, Lord Addington, who has kept those Benches quorate on so many late nights, deserve better. As for Peers who sit behind the Government, such as the noble Viscount, Lord Stansgate, who has made such a good impact on the House in the few years he has been here, will the Government really be better off without him?

Of course, the Leader of the House has listened carefully to the arguments, but she has never answered the essential question: what have these sitting parliamentarians done to deserve being shown the door in such a way? Your Lordships’ House, I am glad to say, sees things rather differently, and an amendment to the Bill has been passed which insists that arrangements should be made for Peers who wish to stay. It would be a sign of strength if the Government indicated that they will now seek an accommodation with my noble friend Lord True and the convenor on a realistic number of Peers being offered the opportunity to continue their parliamentary lives. We all know that many Peers are planning to retire in any case.

The Bill now returns to the Commons. It is an opportunity over the Summer Recess for the Government to reconsider how they wish to move forward on the Bill. It is never too late to appear gracious, magnanimous—and even kind. Labour’s victory in abolishing heredity here is real. Need we have such a ruthless and unnecessary purge as well?

[Lord Dobbs (Con)]

My Lords, perhaps I might impose for just a few moments on this matter. I think it is relevant to remark on a very significant anniversary for the Labour Party this month. I am not talking about the first anniversary of this Government; I am talking about the 80th anniversary of that remarkable Labour Government of 1945, led by Clement Attlee. Captain Clement Attlee, South Lancashire Regiment, fought nobly and gallantly at Gallipoli, that tragic military adventure—disaster. He was the last but one man to withdraw from the beach at Suvla Bay—a tragic adventure which nearly cost Winston Churchill his entire political career. The clock moved on; the names of the beaches changed. In the Second World War, they were Dunkirk, Omaha and Gold. Yet, throughout the Second World War, Clement Attlee formed a very special relationship with Winston Churchill. Of course, they hated each other, they loathed each other’s politics and they fought hard about it, but it was a relationship based on personal respect and tolerance. That relationship changed history. It changed the history of our country and of the entire world.

That relationship has something to tell us about today. It is an example of tolerance that drives democracy. Democracy is not simply about the heavy hand of numbers, votes, and the clenched fists of manifestos and mandates. It is about getting things done. Tolerance and respect are the lifeblood of democracy, which enables those great tectonic plates of politics, when they meet, to slide past each other and to survive, rather than meet head on and create chaos around us.

One thing we can say about our noble hereditaries, whom we are just about to say goodbye to, is that they did not come here for a title—most of them have several. They came here for public service. They came here to do their duty, as so many generations of their families before them had done. I wish to pay my respect and offer my gratitude to them and, indeed, to express my deep personal affection for so many of them who have served. They are an example to the rest of us in that, and I hope that the Government will take the example of that great Labour leader, Clement Attlee, and, in the way that they implement this Bill, show the respect and the tolerance for which he set an example. Our hereditary Peers deserve it. They should go with our good will, our blessing and, indeed, our friendship.

[Lord Moore of Etchingham (Non-Afl)]

My Lords, I have attended all stages of this Bill and collected a strong sense that the Government have seen it as something which it is not. They have regarded it as a tidying-up exercise, but it is a constitutional reform and therefore serious. I try to imagine how future historians may look upon what has happened. I do not think that they will see this as part of a series of measures like those which gradually extended the franchise, for example. There will not be a common emancipating thread running through it all. Instead, historians will see it as a measure which finally ended the main principle upon which the British second Chamber was constructed and replaced it with nothing—but nothing will come of nothing.

16:00

I would argue that the principle of heredity has more merits than these debates have allowed. It is well-rooted in human nature and, though undemocratic, is readily compatible with a mainly democratic system. You can see the same with monarchies. If you look at the Freedom House list of the freest countries in the world, you find that 10 of the top 20 have monarchies. Noble Lords will immediately and quite rightly object that none of them, apart from us, has hereditary peerage, and that is correct, but all those monarchies have second Chambers which are constituted and worked through and have been reformed. Under what is going on now, we will not have that and we have no proper proposals as such.

Your Lordships’ House’s representational power once the hereditaries are gone will actually be weaker than it was when it first developed centuries ago. At least in those days it represented powerful interests in the life of the nation, whereas we, except for the Lords temporal, are almost all here as creatures of prime ministerial patronage.

As well as saying goodbye and thank you to the 86 now leaving us, with whom we have, to quote the poet,

“tired the sun with talking”

many a time, and whom I look at as prisoners awaiting their sentence, we might consider later that we are doing something quite big yet rather small-minded—which one always regrets.

Being a hereditary-minded person, I am very proud to have grandchildren. It is unlikely, I admit, but if they ever ask me what I did in the war for parliamentary reform, I want to be able to say, “Well, my dears, I tried to uphold Parliament’s independence and legitimacy”.

[Lord Forsyth of Drumlean (Con)]

My Lords, my grandchildren refer to the Parliament building from outside as “Grandpa’s office”.

This is a moment in which we have lit a fuse; a fuse which will ultimately change irrevocably the nature of the House of Lords and, more importantly, and perhaps for those at the other end to consider, the House of Commons.

I have always been opposed to the idea of an elected House of Lords, partly because of my experience in the House of Commons and my belief in the primacy of the House of Commons. As our leader, my noble friend Lord True, pointed out, to suddenly create a House which is wholly appointed and depends wholly on prime ministerial patronage is to open the gates for the arguments which we have heard for so many years from the Liberal Benches for an elected House. How can it be possible to sustain the idea that it is better to have people appointed by Prime Ministers than people who are elected by the people?

There is an opportunity, by accepting the amendment which has been made to the Bill, to at least mitigate it. If people see that Prime Ministers can remove whole groups of people, whether that is hereditaries, people over the age of 80 or people who have some other characteristic, then the voters will ask why the Prime Minister should choose and why they, as electors, should not choose.

If we have an elected House, as the leader of the Liberal Democrats wants—I am calling them Liberal Democrats today, because he is making a democratic argument—I think we will find that the future of the House of Commons as the primary Chamber will change irrevocably. That is the basis upon which all reforms have failed, when the penny has suddenly dropped for Members of Parliament that there will be a Member of the second Chamber in their constituencies; that their role as constituency MPs will be undermined; that their ability to make promises on the doorstep will be second-guessed; and that party management will result in the membership of this House, under an elected system, being determined by party leaders, so that it is filled with people who go along with whatever the party management wish—not something that I find very attractive.

I just hope that, at the other end, in the zeal for getting rid of hereditaries, which your Lordships’ House has done, they do not miss the point that they have a lit a fuse, which may very well blow everything they believe in and support apart, to the detriment of our country and the good management of our law.

[Lord Grocott (Lab)]

My Lords, I am afraid I am going to break the melancholy mood that we have heard from previous speakers. I thought that this day, when this Bill do now pass, would never come. It is a Bill that removes the hereditary principle as a basis for membership of this House, which is now apparently supported by everyone all the way across the House, of all political persuasions. That is news to me, and I wish someone had told me that a long time ago—it would have saved me a lot of time and trouble over many years.

There is an idea that, somehow or other, this is being rushed and the House is being bounced, so perhaps I could be allowed a trip back a little way, to 1994, when a Bill to remove the hereditary principle from the House of Lords was introduced in the Commons by an obscure Labour Back-Bencher—modesty prevents me mentioning his name. For over three decades, at various levels, this reform, which we are undertaking today, has been gestating, if that is the right word. There is nothing surprising about the fact it has happened as it has; it has been debated ad nauseam, and that is why some of the speeches that we have heard even today surprise me.

I may fall out with my own side over this point, but this is, essentially, a conservative change to the constitution. It is incremental. It has taken place over many years. It was already done in substance, with no hurt to anyone, so far as I can discover, when over 600 hereditary Peers were removed from the House 25 years ago. I am not aware of any threat to our democracy that was occasioned by that change. I saw no amendments to the Bill—I was waiting for them—from some of the advocates of no change over the years, which they easily could have done, seeking to reinstate the 600. The noble Lord, Lord Strathclyde, is generous enough to perhaps regret he did not do it.

All I can say is that, for 31 years, this has been coming around very gradually and far too slowly. I think many Members of the House can understand the frustration I have felt, but, at last, we are at this day when there will be no more ludicrous, farcical, unbelievable, absurd—I cannot find the adjectives, I have run out of them—hereditary Peers’ by-elections. The title is silly enough without going into any detail.

I hope that we can learn two lessons in particular from this whole episode. As I say, I rejoice that the Bill is at last going on the statute book. Of course, people will be missed. They are after general elections. People come and go in Parliaments. But there are two things we should have learned. One, I am afraid, the Lib Dems have not quite learned, and neither have many Conservatives from recent speeches that I have heard. It is this: if you want reform of the House of Lords and go about it on the basis of changing everything—if your objective is an all-singing, all-dancing reform of the Lords, the electoral system, powers and the relationship with the Commons—you will fail. It has failed repeatedly. How many times do we have to prove the obvious? Since 1911, all attempts to effect that kind of change have failed.

The only way to do it—I have been amazed by the number of leading Tories who have said, “Oh, we cannot do that: it is not a thoroughgoing reform of the Lords”—and to effect reform is the way that the Bill does. It is a long-considered, specifically focused change that is pretty well unarguable, as we have demonstrated from the abundant support that now exists for the end of the hereditary principle. If your Lordships want change, do it incrementally; do it a bit at a time, as this Select Committee is, in essence, proposing.

I tried in vain to make changes, over four Private Members’ Bills, numerous debates, interventions and the like. We could have made the kinds of changes that my simple two-clause Bills to end the by-elections offered, on our own, were it not for the hostility of a small number of unreformable Conservatives. I cannot resist saying that, at one point, one of the people opposing a Bill of mine said that he did not like the fact that the Bill was being considered because he was a proper Conservative and he did not like change; in fact, he was not too keen on the 1832 Reform Act. That was a step too far for the most conservative, in those times. The second lesson is to recognise that, if we do not make simple, straightforward, unarguable changes ourselves, then other people will do it for us. That is what will happen.

I strongly recommend that, if we do nothing else as a result of this—about which I am not in the least bit sombre—we learn those two lessons: do it a bit at a time and do it before anyone else does it for you. With that, it is just to say how thrilled I am to say, though not to move, that this Bill do now pass.

[Baroness Butler-Sloss (CB)]

My Lords, I feel impelled to make just a very brief point. I very much support the idea of a Select Committee to look at the future of the House but, before any steps are taken to look at voting and the right to elect Peers, will the Select Committee discuss with the Commons how the Commons sees it and what sort of second Chamber there will be if Peers are elected and have rights that we do not have at the moment?

[Lord Winston (Lab)]

My Lords, I promise not to give as long a speech as my noble friend Lord Grocott. I am speaking on this Bill for the first time, deliberately, having not voted. I think I am the only person in the House who is a card-carrying geneticist. I have been through this during previous Bills, when I made fun of some of the people in the Chamber.

I deeply regret to see friends leaving us, mostly from the Benches opposite but from other places as well. I do not want to get into the reasons for that but to suggest one lesson that we might learn from this. We are in a society that massively respects DNA, heredity and inbuilt virtues, talent and so on. We have to recognise that, in some ways, the lesson from this Bill is a lesson for the Labour Party. The Labour Party has to understand that we cannot change our genes—irrespective of what people might be saying in the health service at the moment—but we have to change our environment. Although this may not be important at the moment, it certainly applies to the whole of our legislation, the whole of Parliament, the whole of our law. The message must surely be that, irrespective of how we have dealt with the hereditary peerage, we need to provide a better environment.

16:15

[The Earl of Caithness (Con)]

My Lords, I have long supported the abolition of the right of hereditary Peers to sit in your Lordships’ House. I have said it in the House before and I meant it. There were two reasons why I did not like the legislation previously brought forward. The first is that they were Private Members’ Bills. A reform of this nature should be a government Bill, and it is quite right that the Government have got their way on it.

The second reason is that I am disappointed that we hereditaries have failed in one respect. In 1999, the then Lord Chancellor the noble and learned Lord, Lord Irvine of Lairg, said to me, “One of the reasons we’ve kept you is to ensure that the Labour Party fulfil their manifesto commitment to reform the House of Lords”. Well, we know that that manifesto commitment was not fulfilled, and it must have been quite hard for some noble Lords to have taken part in and listened to some of the excellent speeches and debates we have had on the Bill. I mention just two: my noble friends Lady Mobarik and Lord Shinkwin, who gave speeches about prejudice at Second Reading.

I thank noble Lords opposite for their kind words to me about how sad they will be to see the hereditaries go. I enjoyed those conversations until they petered out when I said, “Well, you could have done something about it”.

I should also thank the noble Lords opposite, particularly the influx of Labour Peers who came here in 1999. When I first took my seat here, I could claim a maximum daily allowance of £4.73, which is worth £105.14 in today’s money. In 2000-01, after numerous attempts to improve our expenses, they suddenly increased hugely. Our maximum daily claimable allowance went up 50% within a year, and the amount that we could claim—we cannot anymore—for our office, secretarial and research costs for non-sitting days nearly doubled. That was a bonus for me. Like many Peers who took their seat on their Front Bench, I took a substantial reduction in my salary, so the increase in expenses was welcome. I am extremely grateful to the Labour Peers who enabled that.

[Lord Mancroft (Con)]

My Lords, when I made a short intervention at an earlier stage in the Bill, the noble Baroness the Leader of the House, in reply, questioned—not seriously, I hope—whether or not I still liked her. The answer is that of course I do. I hold the noble Baroness in the greatest respect and indeed affection, as does the whole House, and that respect and affection is unaltered by the passage of the Bill. We on this side of the House do not bear personal grudges against political opponents merely because they are enacting decisions with which we may disagree. I accept, as do my noble friends, that the Government are fully entitled to get their business through and pass their manifesto legislation, even if I do not like it. The Bill removes the process by which new Peers can join the House by further by-elections. We accept that, albeit reluctantly.

But nowhere in the Labour manifesto did it state that currently sitting Members of the House would be summarily removed, which is an additional measure and sets a bad and, in my view, dangerous precedent whereby the Executive can simply remove Members of the second Chamber by dint of their majority in the first—an unheard-of provision that exists in no other modern democracy. The noble Lord, Lord Grocott, said that it would be absurd to suggest that this precedent would ever be repeated, but I suspect he is wrong, as he and his noble friends may well find out to their discomfort and cost in the not-too-distant future.

As this Bill enters its final stages, I ask the noble Baroness the Leader in turn whether she still likes me, or whether there something I have done that so deeply offends her that I and my noble friends should be thrown out of this House like discarded rubbish? We often talk of the dignity of the House, but I cannot think of anything less dignified for the House than what the Government are now doing in this Bill.

I would like to think that I have done my duty over the past almost 40 years. I certainly believe we have stuck to our side of the deal that we made 25 years ago with the noble and learned Lord, Lord Irvine, on behalf of the Labour Party—not a deal that tied the hands of a future Government, as has been claimed, but on which, to their shame, this Government are now reneging.

The House is currently wrestling with the provisions of the Employment Rights Bill. The Government are concerned with the rights of those on short-term contracts but at the same time apparently care little for those of us who have worked here with no formal contract. Although none of us in this House is technically employed to serve as Members of the House, it would be difficult to argue that this is not a place of work, or even part-time work. I suppose one could argue that our Letters Patent and Writs of Summons, taken together, constitute at least some form of agreement. Either way, we are now to be treated in a way that no one else in employment or in any workplace in Britain can be treated. It is rightly illegal to sack anyone on the basis of their birth, except here in the upper House of this Mother of Parliaments.

Before I go, I would be very grateful if the noble Baroness the Leader could tell me exactly what it is that we have done that is so wrong as to deserve being treated in this way. The noble Lord, Lord Grocott, has repeatedly gone out of his way to say that this is not personal, but he is wrong, because it is very personal to each and every one of us to be treated like this by those we considered our friends and colleagues. It is also deeply offensive. I would simply like to know why. Is that really too much to ask?

[Baroness Smith of Basildon (Lab)]

My Lords, I had not intended to respond at length, and I will not, given that this debate on Third Reading has been quite a long one. I was reminded earlier that yesterday was the anniversary of the moon landing. Apollo 11 took eight days, three hours, 18 minutes and 35 seconds to complete its mission. I think that is just slightly short of the time we have spent debating this Bill throughout its passage.

A number of issues were raised. Yes, I still have a soft spot for the noble Lord, Lord Mancroft, and of course this feels personal to those departing hereditary Peers. It felt very personal to me when I lost my seat as a Member of Parliament, with far less notice. He said that this Bill was not in the Labour Party manifesto. It was. He may recall that, when we debated the Grocott Bill, I said, and I wrote in the House magazine, that we should accept it and that we would help to get it through, otherwise we would be in a position where all hereditary Peers would be removed under a Labour Government. So, he was given some notice of that; he may not have listened to me or read anything that I wrote, but it was said and it was in the Labour Party manifesto.

Nothing about the legislation says that we do not value the work of hereditary Peers, or that of any other Member of your Lordships’ House. That has always been the case, but we were quite clear that the hereditary route is not the route into your Lordships’ House that the country or the Labour Party expects.

I will look again at what the noble Lord, Lord True, said, but I think he said that, if we were not to proceed with the Bill in the way it has been drafted, it would unleash a spirit of good will. I hope that was not an indication that carrying out a Bill that is in our manifesto would unleash a spirit of something opposite to good will. I hope that is not what he intended, but that is certainly how it came across.

The noble Lord, Lord Forsyth, was concerned that this Bill opens the gates to further reform or change. I have also heard from other noble Lords that, if we finish with this Bill, nothing will ever happen again. Both cannot be true, but I think this House should take more responsibility for what we can do. If we had taken responsibility for the Grocott Bill and managed to get it through, we probably would not be here today.

On the issue about Select Committees, I know the noble Lord would like to go further and faster. I am a great believer in bite-sized chunks and the House taking responsibility. If we can make progress on those two issues and, by implication, the impact on the size of the House, I think good progress can be made. If we show we can take responsibility for the work of our House as a House, cross-party, we can do so again in the future. So I do understand the views that have been expressed. This is a matter of principle. It was flagged for some time. It was a clear manifesto commitment.

16:25

Bill passed and returned to the Commons with amendments.

Renters’ Rights Bill

Monday 21st July 2025 Lords Chamber

Third Reading

16:27

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

My Lords, I have it in command from His Majesty the King to acquaint the House that His Majesty, having been informed of the purport of the Renters’ Rights Bill, has consented to place his interest, so far as it is affected by the Bill, at the disposal of Parliament for the purposes of the Bill.

Clause 12: Duty of landlord and contractor to give statement of terms etc

Amendment 1

Moved by

[Lord de Clifford]

1: Clause 12, page 20, line 4, leave out “16B” and insert “16C”

[Lord de Clifford (CB)]

My Lords, these two amendments in my name relate to reference changes within the Bill due to the Government’s amendment with regard to pet insurance and my amendment which the House kindly supported last week with regard to the addition of pet insurance deposits. I beg to move.

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

My Lords, once again I thank the noble Lord, Lord de Clifford, for all his thoughtful contributions and engagement during the passage of the Bill. Amendments 1 and 2 correct two cross-references in Clause 12 and Schedule 2 and follow on from Amendment 53A on Report. These amendments do not change the substance of the amendment that was agreed on Report and, on that basis, we are happy to agree to them.

Amendment 1 agreed.

Schedule 2: Amendments relating to Chapter 1 of Part 1

Amendment 2

Moved by

[Lord de Clifford]

2: Schedule 2, page 204, line 5, leave out “16B” and insert “16C”

Amendment 2 agreed.

16:30

Motion

Moved by

[Baroness Taylor of Stevenage]

That the Bill do now pass.

[Baroness Taylor of Stevenage (Lab)]

My Lords, I thank noble Lords for their contributions and engagement during the passage of the Renters’ Rights Bill. We have debated this Bill at length—passing the midnight hour on one occasion—over the past six months, with many thoughtful and considered contributions from across the House. I am grateful, in particular, to the Opposition Front Bench, namely the noble Baroness, Lady Scott of Bybrook, and the noble Lord, Lord Jamieson, for their robust and constructive challenge throughout the passage of the Bill. I also thank the noble Baronesses, Lady Thornhill and Lady Grender, for their continued engagement and support. I believe we are in broad agreement that this Bill is long overdue and are looking forward to seeing it make a real difference to people who rely on the sector to live and work.

Many noble Lords generously lent their extensive expertise to this debate, including the noble Earl, Lord Kinnoull, the noble Lords, Lord Young of Cookham, Lord Cromwell, Lord Best, Lord Carrington, Lord de Clifford and Lord Pannick, the noble Baroness, Lady Wolf of Dulwich, and many more. While there may be disagreement on some of the issues we have debated, I know we all share the same aim of ensuring that the private rented sector continues to work for all.

Finally, I thank my Whip who sat with me throughout the Bill, my noble friend Lord Wilson of Sedgefield. I am grateful to all the officials who have worked on this Bill, including the Bill team, particularly Aidan Hilton, the Bill manager, but also Hermione, James, Caragh, Tom, Ross, Anna, Camilla, Guy and Stephanie, and my private office. I also pay tribute to all the parliamentary staff, including the clerks, doorkeepers, security and the Public Bill Office, many of whom have had to stay late as we debated this Bill into the early hours. I beg to move.

[Baroness Scott of Bybrook (Con)]

My Lords, I begin by thanking all noble Lords across the House for their contributions to the scrutiny of the Bill. While we may differ in our views, the commitment shown by Members to improving the private rented sector is evident and deeply valued.

I also extend my sincere thanks to the Minister. She has shown courtesy, patience and great resilience throughout this process, defending what we would consider a difficult Bill and, often, an indefensible one. She has defended a policy that we think reflects more political positioning than practical policy-making.

Despite the Minister’s efforts, we are left with a piece of legislation that risks doing more harm than good. The facts are stark. According to Savills, the number of rental properties on its books dropped by 42% in quarter 1 this year, compared with the same period in 2024. That means 42% fewer homes available: fewer homes for families, less mobility for renters, less choice, and more pressure on rents.

This is not theoretical; it is happening now, and the Bill is accelerating that trend. Its uncertainty around fixed-term tenancies, poorly defined possession grounds, and reliance on stretched tribunals are driving responsible landlords away from the sector. When providers exit, supply shrinks—and when supply shrinks, rents rise.

We understand why tenants seek greater security but let us be honest: much of what the Bill tries to fix are symptoms of a very deep problem. There are simply not enough rented properties in this country, and there will be fewer. Instead of addressing that shortage, this legislation papers over the cracks, with layers of regulation that risk doing more harm than good. It treats the pressures of scarcity—rising rents, insecurity and limited choice—as issues that can be regulated away. Regulation without supply is a dead end.

What we need is a balanced approach. Yes, let us protect tenants, but let us also create the conditions for responsible landlords to stay in the market, invest and offer decent homes. Without that balance, the consequences are predictable, and they are already playing out.

The real target should be the rogue landlords: those who exploit vulnerable tenants and undermine confidence in the sector. The Bill misses that mark. Instead of cracking down on the worst offenders, it heaps new burdens on the majority who act responsibly. What the sector truly needs is a rogue landlord Bill that is targeted, proportionate and enforceable, one that protects tenants without pushing decent landlords out of the market.

Instead, we have a Bill that gets the balance wrong. It risks shrinking supply, increasing costs and adding complexity just when we most need clarity and confidence. The Bill does not strike the right balance between protection and provision. It fails tenants, landlords and the very market that it claims to reform. On this side of the House we will continue to monitor the market and challenge the Government to act on any negative outcomes.

Before I sit down, I congratulate Sam and Molly in my office—it is her first Bill in this House. I thank them sincerely for the fantastic support they have given me and my noble friend Lord Jamieson throughout the passage of the Bill.

[Baroness Thornhill (LD)]

My Lords, we on these Benches have been clear throughout the Bill that we support it very much: its main provisions, including the abolition of no-fault evictions and fixed-term tenancies, and its clear emphasis on tenants’ rights and much more transparency. There is no doubt that it is a radical Bill that will make significant changes to the private rented sector. It has also been said, and I wish to repeat it, that good landlords have nothing to fear from these reforms, and we on these Benches sincerely hope that that will be proved to be the case.

It is usual to say that this process is about improving the Bill through reasoned debate and using the expertise of the House. In truth, to me it felt more like a conflict—a battle of tenants versus landlords—with the bold reforms of the Government pitted against the fears and genuine concerns of the landlords, articulated sincerely and robustly by the Opposition Front Bench and others around the House.

There were also cross-House issues where only time will tell, such as the capacity of the courts. Another is the impact on all aspects of the housing market, including student landlords and the supply of homes to rent, about which let us say there were polarised views. We share the concerns expressed by the noble Baroness, but we also hope that the recent figures will steady and that, after inevitable initial upheaval, the market will settle down. We look forward to more build-to-rent and more social housing, because both are needed.

We hope that the Minister’s assurances on the military homes standard will also come to pass, as our amendment on that issue was won convincingly.

Lastly, I have some very genuine thanks. I thank everyone who took part in the many debates on amendments, which were based on honest beliefs and genuine experience, but particularly the Minister for her time, which was generously given, and for her patience—tested perhaps just a little by the determined double act of the noble Baroness, Lady Scott, and the noble Lord, Lord Jamieson. I admired their persistence, but the Minister showed that she was not willing to be moved on the Government’s core planks of the Bill, and her steeliness in the onslaught, however politely delivered, was commendable.

We cannot forget the valuable contributions of several noble Cross-Benchers. The noble Lords, Lord Cromwell, Lord Best and Lord Carrington, formed a new trio. There was also much legal wrangling. My learning curve was greatly assisted by several noble Lords who are lawyers, especially the noble Earl, Lord Kinnoull, even if I did not always agree with them.

For its advocacy on behalf of tenants and for shining a light on the reality of many renters, the Renters’ Reform Coalition deserves a big thank you. Generation Rent deserves a special mention—as does the National Residential Landlords Association. For me, it was challenging to read its excellent briefings and pit its persuasive arguments against my own.

It is also appropriate to thank all the officers of the House, who have no doubt worked tirelessly to get everything done on time and correctly delivered. This was my first Bill lead, and I am grateful to have had a small but dedicated team behind me, especially my noble friends Lady Grender and Lord Shipley. Where would any of us be without our able and professional staff—in this case, Adam Bull from our Whips’ Office? It has been a worthy task to contribute to the much-needed reform of the private rented sector.

[Lord Hacking (Lab)]

My Lords, traditionally, Third Reading is an occasion to give thanks and congratulations to all those involved in the Bill, whether inside this Chamber or outside. My noble friend the Minister has led us well, as the noble Baronesses, Lady Scott and Lady Thornhill, who is leader of the Liberals on this, have kindly done. At this stage, our Companion makes it plain that the debates of previous stages of the Bill should not be reopened and speeches should be brief. I hope that my noble friend Lord Leong is noting that I am saying this. I intend to abide by these requirements.

[Lord in Waiting/Government Whip (Lord Leong) (Lab)]

Good.

[Lord Hacking (Lab)]

I am now getting congratulations from my noble friend, which are very warmly felt. We cannot, however, leave the Bill without giving profound thanks to my noble friend the Minister for her pioneering of the Bill through all stages of its passage through this House. I think I echo the words of the noble Baroness, Lady Scott, in that regard.

Throughout, the Minister has been a paragon of patience and courtesy. She has also been enormously conscientious, holding meetings right up to the third day on Report and sending letters—even though the letter to the noble Lord, Lord Carrington, was somehow in transit on the third day of debate. Not wishing to leave anybody out, she recently thanked and congratulated a Peer on a speech he had not made, but nobody was left out as a result.

A special reason to thank and congratulate the Minister is the sheer length and complexity of the Bill. I also congratulate the noble Baronesses, Lady Scott and Lady Thornhill, on dealing with the length and complexity of the Bill, as well as the noble Lord, Lord Jamieson—I am sorry that I did not bring his name to the fore until now. The Bill itself—this is somewhat alarming—stretches over 258 pages but still has to be spliced into earlier statutes, most particularly the Housing Act 1988.

I have in my hand the annotated current edition of the Housing Act 1988. It stretches over 383 pages but, by the time the provisions of this Bill have been spliced into it, it will be 600 or 700 pages long. I do not wish to introduce this debate now, but I believe the length of these Bills is a subject that should have attention on another occasion. For example, the Housing Act 1988 can be read in its completion. It tells you the state of landlord and tenant law in 1988. When I first came to the House 54 years ago, legislation was not run in this direction. As I said, this is a matter for another debate on another occasion.

I will just end on a personal note. I am aware that it must have been difficult for my noble friend the Minister to have me sitting right behind her and muttering from time to time, but I ask her forgiveness. I am very lame. I always used to sit at the back, but I am afraid my lameness has taken me to immediately behind the Minister. I apologise, but I hope that she will accept that my many interventions were made in a genuine attempt to improve the Bill: to focus more clearly on the rogue landlord and to protect the honest landlord.

[Lord Carrington (CB)]

I give my very personal thanks to the Minister for her work on this Bill and the enormous amount of follow-up she achieved. Her final letter arrived, as the noble Lord, Lord Hacking, just mentioned, on Friday.

I have two reservations. All my amendments were about two matters. The first was the difference of the private rental sector in rural areas and the second was the effect of the Bill on institutional investment in the sector. I will be watching these in the remainder of my stay in the House of Lords. In the meantime, I would like to thank everybody who has been involved and not waste any more of your Lordships’ time.

16:45

[Baroness Taylor of Stevenage (Lab)]

My Lords, for the thousands of renters and the good landlords who have been disadvantaged by the actions of rogue landlords around this country, not to mention the local authorities that have had to pick up the pieces of the failure to act over the last 14 years, which has created the worst housing crisis in generations, I hope this Bill will be a blessed relief.

This Bill, combined with the comprehensive package of measures on housing delivery, including £39 billion in funding for affordable and social housing, comprehensive reform of the planning system and unprecedented investment in construction skills and training, will start the process of delivering what we all want to see—that everybody has a fit, safe, secure and affordable home. My young grandson, who is only nine years old, was asked to write about home the other day. He did a diagram with lots of things saying what he felt home was. At the bottom, he wrote, “Home is as special as love”. I thought that was a marvellous phrase from a nine year-old.

I know we will continue to debate some of the detail around the Bill. I hope we can all keep in our minds as we do so how important just having a home is to everybody and how it being safe, secure and affordable is important to everybody.

Bill passed and returned to the Commons with amendments.

Employment Rights Bill

Report stage
Monday 21st July 2025 Lords Chamber

Report (3rd Day)

Relevant documents: 20th and 29th Reports from the Delegated Powers Committee and 7th Report from the Constitution Committee. Scottish, Welsh and Northern Ireland legislative consent granted.

16:47

Amendment 111ZA

Moved by

[Lord Clement-Jones]

111ZA: After Clause 34, insert the following new Clause—
“Workplace AI risk and impact assessments(1) Before implementing or developing an AI system which may have significant risks or impacts on employment rights and conditions in the workplace, an employer must conduct a workplace AI risk and impact assessment (a “WAIRIA”)(2) A WAIRIA must be conducted under this section if there is a potential significant risk or impact on—(a) the identification or exercise of rights;(b) recruitment;(c) work access or allocation;(d) remuneration or benefits;(e) contractual status, terms or conditions;(f) mental, physical or psychosocial health.(3) A WAIRIA conducted under subsection (1) must—(a) document the intended purpose and functionality of the AI system;(b) establish a process for undertaking the monitoring of significant risks and impacts; (c) document the definitions, metrics and methods selected for the WAIRIA;(4) Employers must review and update the WAIRIA—(a) at least once every 12 months,(b) whenever substantial changes are made to the AI system to which it relates, or(c) when evidence emerges of unforeseen significant risks or impacts.(5) The Secretary of State must require any Fair Work Agency to issue guidance on the conduct disclosure and enforcement of WAIRIAs within 6 months of this section coming into force.”

[Lord Clement-Jones (LD)]

My Lords, Amendment 111ZA seeks to introduce a requirement for workplace AI risk and impact assessments. This amendment is focused on addressing the profound and rapidly evolving impact of artificial intelligence systems on the modern workplace. There are many opportunities for its adoption but also risks and impacts. There is potentially massive job displacement. AI could displace 1 million to 3 million UK jobs overall. There are workplaces skills gaps; more than half the UK workforce lacks essential digital skills and the majority of the public has no AI education or training.

AI recruitment algorithms have resulted in race and sex discrimination. There are legal vulnerabilities. Companies risk facing costly lawsuits and settlements when unsuccessful job applicants claim unlawful discrimination by AI hiring systems. Meanwhile, AI adoption accelerates rapidly, and the UK’s regulatory framework is lagging behind.

Organisations such as the Trades Union Congress and the Institute for the Future of Work have consistently highlighted the critical need for robust regulation in this area. The TUC, through its artificial intelligence regulation and employment rights Bill, drafted with a multi-stakeholder task force, explicitly proposes workforce AI risk assessments and emphasises the need for worker consultation before AI systems are implemented. It also advocates for fundamental rights, such as a right to a human review for high-risk decisions. IFOW similarly calls for an accountability for algorithms Act that would mandate pre-emptive algorithmic impact assessments to identify and mitigate risks, ensuring greater transparency and accountability in the use of AI at work. Both organisations stress that existing frameworks are insufficient to protect workers from the potential harms of AI.

When I spoke to a similar amendment—Amendment 149—in Committee, the Minister acknowledged this and said:

“The Government are committed to working with trade unions, employers, workers and experts to examine what AI and new technologies mean for work, jobs and skills. We will promote best practice in safeguarding against the invasion of privacy through surveillance technology, spyware and discriminatory algorithmic decision-making … However, I assure the noble Lord, Lord Clement-Jones, that the Institute for the Future of Work will be welcome to make an input into that piece of work and the consultation that is going forward. I reassure the noble Baroness, Lady Bennett, and all noble Lords that this is an area that the Government are actively looking into, and we will consult on proposals in the make work pay plan in due course”.—[Official Report, 5/6/25; col. 878.]


This was all very reassuring, perhaps, but I have retabled this amendment precisely because we need more concrete specifics regarding this promised consultation.

The TUC and IFOW have been working on this for four years. Is it too much to ask the Government to take a clear position on what is proposed now? The Minister referred to the importance of proper consultation. This is a crucial area impacting the fundamental rights and well-being of workers right now, often without their knowledge, and AI systems are increasingly being introduced into the workforce, so the Government need to provide clarity on what kind of consultation is being undertaken, with whom they will engage beyond relevant stakeholders and what the precise timescale is for this consultation and any subsequent legislative action, particularly given the rapid introduction of AI into workplaces.

We cannot afford a wait-and-see approach. If comprehensive AI regulation cannot be addressed within this Bill as regards the workplace, we need an immediate and clear commitment to provision within dedicated AI legislation, perhaps coming down the track, to ensure that AI in the workplace truly benefits everyone. I beg to move.

[Lord Holmes of Richmond (Con)]

My Lords, it is always a pleasure to follow my friend, the noble Lord, Lord Clement-Jones, who, in his single Nelsonian amendment, has covered a lot of the material in my more spread-out set of amendments. I support his Amendment 111ZA and will speak to my Amendments 168 to 176. I declare my interests in the register, particularly my technology interests, not least as a member of the advisory board of Endava plc and as a member of the technology and science advisory committee of the Crown Estate.

I will take one brief step backwards. From the outset, we have heard that the Government do not want to undertake cross-sector AI legislation and regulation. Rather, they want to take a domain-specific approach. That is fine; it is clearly the stated position, although it would not be my choice. But it is simultaneously interesting to ask how, if that choice is adopted, consistency across our economy and society is ensured so that, wherever an individual citizen comes up against AI, they can be assured of a consistent approach to the treatment of the challenges and opportunities of that AI. Similarly, what happens where there is no competent regulator or authority in that domain?

At the moment, largely, neither approach seems to be being adopted. Whenever I and colleagues have raised amendments around AI in what we might call domain-specific areas, such as the Product Regulation and Metrology Bill, the data Bill and now the Employment Rights Bill, we are told, “This is not the legislation for AI”. I ask the Minister for clarity as to whether, if a cross-sector approach to AI is not being taken, a domain-specific approach is, as opportunities are not being taken up when appropriate legislation comes before your Lordships’ House.

I turn to the amendments in my name. Amendment 168 goes to the very heart of the issue around employers’ use of AI. Very good, if not excellent, principles were set out in the then Government’s White Paper of 2023. I have transposed many of these into my Amendment 168. Would it not be beneficial to have these principles set in statute for the benefit of workers, in this instance, wherever they come across employers deploying AI in their workplace?

Amendment 169 lifts a clause largely from my Artificial Intelligence (Regulation) Private Member’s Bill and suggests that an AI responsible officer in all organisations that develop, deploy and use AI would be a positive thing for workers, employees and employers alike. This would not be seen as burdensome, compliant or a mere question of audit but as a positive, vibrant, dynamic role, so that the benefits of AI could be felt by workers right across their employment experience. It would be proportionate and right touch, with reporting requirements easily recognised as mirroring similar requirements set out for other obligations under the Companies Act. If we had AI responsible officers across our economy, across businesses and organisations deploying and using AI right now, this would be positive, dynamic and beneficial for workers, employees, employers, our economy and wider society.

Amendment 170 goes to the issue of IP copyright and labelling. It would put a responsibility on workers who are using AI to report to the relevant government department on the genesis of that IP and copyrighted material, and the data used in that AI deployment, by which means there would be clarity not only on where that IP copyright and data had emanated from but that it had been got through informed consent and that all IP and copyright obligations had been respected and adhered to.

Amendments 171 and 172 similarly look at where workers’ data may be ingested right now by employers’ use of AI. These are such rich, useful and economically beneficial sources of data for employers and businesses. Amendment 171 simply suggests that there should be informed consent from those workers before any of their data can be used, ingested and deployed.

I would like to take a little time on Amendment 174, around the whole area of AI in recruitment and employment. This goes back to one of my points at the beginning of this speech: for recruitment, there currently exists no competent authority or regulator. If the Government continue with their domain-specific approach, recruitment remains a gap, because there is no domain-specific competent authority or regulator that could be held responsible for the deployment and development of AI in that sector. If, for example, somebody finds themselves not making a shortlist, they may not know that AI has been involved in making that decision. Even if they were aware, they would find themselves with no redress and no competent authority to take their claim to.

17:00

Would the Minister not agree that this makes the case for at least the consideration of a recruitment and employment-specific regulator to be brought about through this Bill? If not, I would certainly prefer to have a light-touch, cross-sector AI authority which would ensure that, wherever individuals, workers, employees and citizens come across AI, they can have clarity, certainty and consistency in its application. In this instance, it would be in the area of recruitment, but the AI authority—agile, light-touch and, crucially, horizontally focused—would ensure clarity, certainty and consistency across all sectors of employment, our economy and society.

I will touch briefly on Amendment 176 and the algorithmic allocation of work. Again, this is already happening, often without employees even being aware that that is the case. What is the Government’s position on the algorithmic allocation of work? If this amendment is not to be considered and adopted, what is the Government’s approach to how this is currently occurring in our economy to workers right now, often with an extremely discriminatory and detrimental impact on those workers?

AI has such potential to transform employment for the benefit of workers, employers, businesses and our economy. It has the potential, if it is human-led AI, to drive productivity in a way that no other element of our economy is currently likely to do. Similarly, if we do nothing and continue with this wait-and-see approach to legislation and regulation, it is most likely that workers may often find themselves at the sharp end of the algorithmic allocation of work, AI in the workplace taking their data and numerous other issues, unable to avail themselves of the benefits.

This situation could be wholly averted if some of these amendments were considered and incorporated into the Employment Rights Bill. Better still, the Government should reconsider bringing forward a cross-sector AI regulation Bill. What we know fundamentally is that regulation is right: right for workers, right for employees, and right for all aspects of our economy and society. When I say that regulation is right, I mean the right size regulation. What we know from history, not least from recent history, is that right-size regulation is good for innovation, investment, citizens, creativity and our country. Would the Government be good enough to agree?

[Lord Pitkeathley of Camden Town (Lab)]

My Lords, I am aware that many of the amendments in this group have a rather different focus from the points I wish to make. I acknowledge the amendments by the noble Lords, Lord Clement Jones and Lord Holmes of Richmond. I believe they provide a valuable opportunity to reflect on the particular nature of working in tech and AI. This is, as has already been alluded to, a sector that makes a significant and growing contribution to the UK economy, and it is rightly seen as one of the priority strands of the Government’s modern industrial strategy.

As the rather scary AI 2027 forecast by Daniel Kokotajlo and other makes clear, developments in this space are accelerating incredibly rapidly and are already reshaping how we live and work. Even as I say that, I wonder whether I may have triggered an algorithmic alert somewhere—let us hope that parliamentary privilege covers some of it. AI is happening, regardless of how we feel about it, and the opportunity it provides makes it all the more important that firms are based and regulated here rather than elsewhere.

Jobs in this area tend to be highly skilled and well paid, but that does not mean workers do not need some protections. In many cases, the things that matter most are not issues such as minimum wage and paid leave but how easily people can move between companies, start their own ventures and work across several fast-growing enterprises. Here, it is non-compete agreements which pose a particular challenge. Understandable concerns over safeguarding intellectual property have led some firms to restrict employee movement, yet this comes at a cost to innovation, competition and the free flow of ideas that underpin these industries. I know the last Government carried out a review of these clauses in general terms, but no meaningful reform followed. Does the department have a view on how widespread these clauses now are, particularly in fast-moving and competitive sectors? Has any formal assessment been made of their impact on innovation, start-up activity, and people’s ability to move freely and fairly between roles?

I fully appreciate that this Bill is focused on establishing baseline rights for all workers rather than addressing sector-specific concerns. However, I hope the Minister can say something about how these challenges are being considered as part of the Government’s wider thinking on the future of work and on how we ensure that the UK remains a good place to innovate, as well as a fair place to work.

[Lord Freyberg (CB)]

My Lords, I support the timely and vital amendments tabled by the noble Lords, Lord Clement-Jones and Lord Holmes of Richmond, concerning the use of artificial intelligence in the workplace. These amendments, which cover transparency, accountability, consent, fairness and the protection of workers’ rights, speak to one of the central challenges of our time: how we align the rapid deployment of AI with the rights, dignity and agency of working people.

Just 11 days ago, a few of us, including the noble Lord, Lord Clement-Jones, had the privilege of attending the round table on aligning AI for human flourishing, hosted here in the House of Lords by the noble Baroness, Lady Kidron, and convened by Oxford University’s Institute for Ethics in AI and the Accelerator Fellowship Programme. It was led by Professor Yuval Shany and brought together leading international voices, including Professor Alondra Nelson, who designed the US Blueprint for an AI Bill of Rights, later embedded in President Biden’s executive order on AI.

That discussion made one thing clear: we are at a crossroads. As Professor Nelson put it at a recent AI action summit in Paris:

“We can create systems that expand opportunity rather than consolidate power for the few”.


If we are serious about that aspiration, we need laws that embed it in practice. I hope we will soon see legislation introduced in this House—an AI Bill of Rights rooted in the UK context—that reflects our democratic values, legal traditions and the lived realities of British workers. That will require leadership from the Government and support across parties, and I believe this House is well placed to lead the way.

That is precisely what the amendments tabled by the noble Lord, Lord Holmes, seek to do. Amendment 168 outlines the core principles employers must uphold when using AI on workers: safety, fairness, transparency, governance, inclusion and the right to redress. These are the bedrock of responsible innovation. Amendment 169 proposes the appointment of designated AI officers within organisations, ensuring that someone is directly accountable for the ethical and unbiased use of these powerful technologies.

Amendments 171 and 172 tackle perhaps the most urgent concern: consent. No worker’s data should be ingested by AI systems—or decisions made about their employment by algorithm—without their meaningful, informed opt-in. We are not speaking in abstractions; AI is already determining who is shortlisted, scheduled, surveilled or sidelined. These systems often operate in secret and carry forward the biases of the data they are trained on. If we do not act now, we risk embedding discrimination in digital form.

This is not the first time that this House has stood up for fairness in AI. On 12 May, and in subsequent ping-pongs on the data Bill, many of us voted in support of the amendments tabled by the noble Baroness,sb Lady Kidron, which called for transparency over copyright and AI. That debate too was about rights—to control one’s work, one’s data and one’s identity. The same principle is at stake here. If the UK is to lead on AI, we must lead not just in capability but in ethics. The amendments tabled by the noble Lord, Lord Holmes, are not radical but responsible; they bring our values into alignment with our technologies. I therefore urge all noble Lords to support them, even though it is highly unlikely that they will be accepted.

[Lord Palmer of Childs Hill (LD)]

From these Benches, all I can say is that I echo those words. I hope that the Government have listened to the arguments about AI and will respond positively.

[Lord Hunt of Wirral (Con)]

My Lords, I too congratulate my fellow solicitor, the noble Lord, Lord Clement-Jones, and my noble friend Lord Holmes of Richmond on their amendments.

We are following up on the exchanges that took place at Question Time earlier today, when the Minister—the noble Lord, Lord Vallance—offered to give us a reading list so that we could peruse the subject during the vacation, when he explained that, sadly, the Government are not yet able to produce their consultation paper. When the noble Baroness the Minister sums up this debate, can she identify for us what her noble friend had in mind? We are anxious to make sure that we are up to date on these very important subjects.

AI technologies are evolving at pace, touching every corner of the economy, from manufacturing and logistics to retail, healthcare and particularly—as my noble fellow lawyer knows—professional services. In the context of work, AI offers real potential: it can support productivity, streamline processes and free individuals from repetitive and burdensome tasks. It may also, if properly deployed, open up new opportunities for people who have historically faced barriers to employment.

However, as the noble Lord, Lord Freyberg, just reminded us, alongside that, there are real concerns. He instanced a number of them, and they are set out in Amendment 168; they are about fairness, transparency, accountability and, indeed, the role of human oversight in the decisions that affect people’s lives and livelihoods. It is therefore important that we take a balanced, thoughtful approach.

The noble Lord, Lord Pitkeathley of Camden Town, pointed out, quite rightly, that a number of non-compete agreements are now emerging. We have to be aware that these could so easily stifle innovation, and this must be all about encouraging and stimulating innovation. Therefore, it is very important that we take a balanced, thoughtful approach. But we should not allow technological change to outpace our frameworks for fairness, ethics and employment rights.

In conclusion, AI is not a distant or abstract issue; it is here, evolving and shaping the future of work. I hope we can move forward in a way that is both pro innovation and firmly rooted in the values of fairness, dignity and accountability. We very much look forward to hearing the Minister’s thoughts on these subjects.

17:15

[The Parliamentary Under-Secretary of State, Department for Business and Trade and Department for Science, Information and Technology (Baroness Jones of Whitchurch) (Lab)]

My Lords, I will begin with Amendment 111ZA, moved by the noble Lord, Lord Clement-Jones, and Amendments 168, 169, 171, 172, 175 and 176, tabled by the noble Lord, Lord Holmes, whom I thank for his engagement on these important issues.

I start by reassuring all noble Lords that we agree that AI should be deployed and used responsibly, including within the workplace. As the noble Lord knows, in January 2025, we published the AI Opportunities Action Plan, which included a commitment to

“support the AI assurance ecosystem to increase trust and adoption”

of AI. One of the key deliverables in this area is the AI management essentials tool. We are developing this tool to support businesses, particularly SMEs, to implement good AI governance practices. Following public consultation earlier this year, I hope to update your Lordships’ House on the consultation response and an updated version of that tool soon.

Regarding these amendments, I remind noble Lords that our plan to make work pay makes it clear that workers’ interests will need to inform the digital transformation happening in the workplace. Our approach is to protect good jobs, ensure good future jobs, and ensure that rights and protections keep pace with technological change.

To be clear, we are committed to working with trade unions, employers, workers and experts to examine what AI and new technologies mean for work, jobs and skills. We will promote best practice in safeguarding against the invasion of privacy through surveillance technology, spyware and discriminatory algorithmic decision-making. In response to the noble Lords, Lord Freyberg and Lord Hunt, of course we will put ethics and fairness at the heart of that.

I am keen to stress that we are taking steps to enhance our understanding of this area. This has included engagement and round-table events with a wide range of stakeholders and experts to help enrich our understanding. I reaffirm that we will consult on the make work pay proposals in due course.

The noble Lord, Lord Clement-Jones, asked what would be in the scope of the consultation. The consultation plan includes examining: what AI and new technologies, including automation and AI, mean for work, jobs and skills; how to promote best practice in safeguarding against the invasion of privacy through surveillance technology, spyware and discriminatory algorithmic decision-making; and how best to make the introduction of surveillance technology in the workplace subject to consultation and negotiation with trade union or employee representatives.

The noble Lord, Lord Holmes, asked whether or not this was going to be domain-specific. As the noble Lord, Lord Hunt, just reminded us, this was dealt with in an Oral Question earlier this afternoon, when my noble friend Lord Vallance said that existing regulators will oversee most AI systems, supported by enhanced AI skills and cross-regulatory co-ordination through forums such as the Regulatory Innovation Office. Some cross-cutting issues will be addressed also in the planned consultation on AI.

Looking specifically at Amendment 171, let me reassure the noble Lord that we believe that data protection legislation provides sufficient protection for workers and individuals where their personal data is being used in line with the key data protection principles, including lawfulness, fairness and transparency. Consent is a lawful ground to process personal data. However, due to the power imbalance between the employee and employer, it is often inappropriate for employers to rely on consent from employees to process their data. This is why we have an additional lawful ground to carry out such processing, such as legitimate interest under the data protection law. Therefore, we do not wish to limit data processing in these situations to consent alone. I also point out that while data protection principles establish the requirements that we expect the use of AI systems to adhere to, AI assurance provides ways to evidence that these requirements have been met in practice.

Amendment 170 tabled by the noble Lord, Lord Holmes, would require workers and employers to maintain records of data and intellectual property used in AI training and to allow independent audits of AI processes. As he will know, this issue was debated extensively during the passage through your Lordships’ House of the Data (Use and Access) Act 2025. Only last month I confirmed that we will publish a report, including on transparency in the use of intellectual property material in AI training, within nine months of Royal Assent to the Act, which will be due by 18 March next year. The Government have also committed to setting up expert stakeholder working groups to help drive forward practical, workable solutions in this area, alongside a parliamentary working group to engage with policy development.

Amendment 174 tabled by the noble Lord, Lord Holmes, proposes a review of the use of AI in recruitment and employment. As the noble Lord will be aware, last year the previous Government published detailed guidance on responsible AI in recruitment, which covers governance, accessibility requirements and testing. This was developed with stakeholders and relevant regulators, such as the Information Commissioner’s Office and the Equality and Human Rights Commission. Employers and recruiters may find this guidance useful to help integrate AI into their recruitment practices in a responsible way.

Furthermore, I am excited about the opportunities of AI in supporting the UK’s workforce, as well as creating jobs and growing our economy. However, we must also understand how it may affect the labour market, including any potential disruption. The AI Security Institute has begun assessing this issue, and I hope to be able to update your Lordships’ House on this as work progresses.

Regarding our position on general AI regulation and the establishment of a new AI regulator, we believe that AI is best regulated at the point of use by the UK’s existing sectoral regulators. As experts in their sector, they are in the best place to understand the uses and risks of AI in their relevant areas, and we will support them to do this. I emphasise that in response to the AI Opportunities Action Plan, we have committed to supporting regulators in evaluating their AI capabilities and understanding how they can be strengthened. I assure your Lordships’ House that we are committed to making sure that workers’ interests inform the digital transformation taking place in the workplace.

I am grateful to my noble friend Lord Pitkeathley for raising non-compete clauses. There has been extensive research and analysis in recent years looking at the prevalence of non-compete clauses in the UK labour market and their impact on both workers and the wider economy. Government research published in 2023 found that non-compete clauses were widely used across the labour market, with around 5 million employees in Great Britain working under a contract that contained a non-compete clause, with a typical duration of around six months. As my noble friend identified, this can adversely impact both the worker affected, through limiting their ability to move between jobs, and the wider economy, due to the impacts on competition.

It is often assumed that non-compete clauses are found only in contracts of high earners. However, research published last year by the Competition and Markets Authority found that while non-competes are more common in higher-paid jobs, even in lower-paid jobs 20% to 30% of workers believe that they are covered by non-compete clauses. The Government have been reviewing the research and work done to date on non-compete clauses, and I am pleased to be able to confirm that we will be consulting on options for reform of non-compete clauses in employment contracts in due course.

Finally, the noble Lord, Lord Hunt, asked for my suggested reading list following my noble friend’s kind offer earlier this afternoon. I can do no better than to recommend the excellent book by the noble Lord, Lord Clement-Jones, on AI. In that spirit, I ask the noble Lord, Lord Clement-Jones, to withdraw his Amendment 111ZA.

[Lord Clement-Jones (LD)]

The noble Baroness nearly won me over at that point. I thank her. I feel like someone who was expecting a full meal but receives a rather light snack. I will explain why as we go through.

I thank the noble Lord, Lord Holmes. I feel that I am somewhat upstaging him by putting an amendment at the front of the group, but we have many common themes that we both have pursued over the years together. I agree with him on the desirability of a cross-sector approach. He is much more patient than I am and, in putting down individual amendments and hoping that the Minister will give satisfactory answers, he is clearly more optimistic than I am. Whether his optimism has been justified today, I am not so sure.

The Minister could not even acknowledge the work done by the TUC, which has been ground-breaking in so many ways. It has taken four years, so it is extraordinary that the Government are doing what they are doing. I acknowledge what the noble Lord, Lord Pitkeathley, had to say. I was not quite sure how it connected to AI, but he very cunningly linked the subject of non-compete clauses to innovation, which does link to AI. I was encouraged by what the Minister had to say about consultation on reform.

The noble Lord, Lord Hunt, reminded me that I was a solicitor. Unlike him, I do not still have a practising certificate still, but there we are. He has much more stamina than I have. Non-compete clauses can be extremely important in making sure that know-how is preserved within an existing business. I thank the noble Lord, Lord Freyberg, for what he had to say on making sure that AI ensures human flourishing and that we preserve agency. That is what the amendments tabled by the noble Lord, Lord Holmes, and me are all about.

The Minister talked about an AI assurance ecosystem and AI management essential tools that there will be a consultation on, but I could not sense any intention to do anything other than a sort of voluntary approach. We have a lot of employment law that has developed over the years, but the Government seem to be allergic to doing anything with any teeth. She mentioned recruitment practices, but that again seems to be very much a voluntary approach. The AI Security Institute is not a regulator. I cannot feel that the Minister has given much more than the noble Lord, Lord Leong, gave last time. For instance, the Minister talked about consultation over make-work proposals. This involved talking about best practice on the adoption of AI and how best to deal with surveillance technology. Again, I did not sense any real intent to make sure that we have a new set of protections in the workplace in the face of AI.

I very much hope that, as time goes on, the Government will develop a much more muscular approach to this. As many noble Lords have said, AI presents a great number of opportunities in the workplace, but we absolutely do not want to see the opportunities overwhelmed by mistrust and a belief that AI presents unacceptable risks on the part of those employees. We want to see employees understanding that in the face of AI adoption, they have the right to be consulted and there is proper risk assessment of the introduction of these systems into the workplace, so that there is a proper, consensual approach to AI adoption.

I really do not feel that the Government are keeping up to date with the issues in this respect, and I am afraid that is rather reflected in some of the issues that we are going to talk about on Wednesday as well. In the meantime, however, I beg leave to withdraw the amendment.

Amendment 111ZA withdrawn.

17:30

Schedule 4: Pay and conditions of school support staff in England

Amendment 111A

Moved by

[Baroness Barran]

111A: Schedule 4, page 201, line 3, leave out “For the purposes of this Part,” and insert—
“(A1) In the case of staff employed under subsection (3)(b) of section 148C, matters within the SSSNB’s remit are limited to the establishment of a framework to which employers of school support staff must have regard when discharging their functions.(B1) A framework under subsection (A1) must include information on—(a) the remuneration of school support staff,(b) the terms and conditions of employment of school support staff,(c) the training of school support staff,(d) career progression for school support staff, and(e) related matters.(C1) When taking any action related to the matters in subsection (B1), an employer may disregard the framework only in exceptional circumstances.(D1) For the purposes of subsection (C1), the definition of “exceptional circumstances” shall be set out in regulations. (1) In the case of staff employed under subsection (3)(a) of section 148C,”Member’s explanatory statement
This amendment would change the matters within the SSSNB’s remit in relation to academy staff, limiting it to the creation of a framework to which academy employers must have regard in all but exceptional circumstances.

[Baroness Barran (Con)]

My Lords, Amendments 111A, 111B, 116A and 116B in my name seek to improve the Government’s proposal to mandate a single, detailed set of terms and conditions for all support staff.

As we debated in Committee, the status quo is not perfect. The current national joint council arrangements have significant weaknesses in their application to schools, which has led some local authorities to opt out of the Green Book terms and conditions. I hope the House will forgive me if I remind noble Lords why these amendments are necessary. First of all, we are talking about a very large workforce: about half a million people are employed within the school support staff workforce. Half of those, roughly, are teaching assistants, and the other half have a huge range of roles, literally thousands of different roles. This is a very complicated area. There is variety in roles and in pay and conditions, which reflects local needs, whether it is the organisational structure of a trust, pressures on a local authority where it opts out of the NJC, or where employers have particular needs because of geographic local market conditions. I mentioned in Committee the difference in trying to recruit an IT assistant in Cambridge versus Oldham.

The landscape is very different today from the early 2000s when the SSSNB previously existed. We now have around 2,500 trusts, with about half our schools in trusts and half in local authorities. But the innovation that we have seen in relation to pay and conditions for school support staff has of course been largely in the trust sector.

I will just recap our specific worries about the Bill as currently drafted. The first is that it will add to the complexity, workload and cost of every single school in the country at a time when we know that schools are under considerable pressure and when the Government are rightly focusing on recruitment and retention of the teaching and support staff workforce. My Amendment 111A seeks to mitigate the potential damage of this by limiting the SSSNB’s powers to creating a framework that academies must consider regarding remuneration, terms and conditions, training, career progression and related matters.

I tried to work out roughly how many role profiles the department will need to create to meet the breadth of roles that the SSSNB will cover. I think it is realistic to say that across about 22,000 schools and around 2,500 trusts, there will literally be thousands of ways of dividing up and specifying roles, so that if the SSSNB is to try to articulate role profiles in detail, it will have to produce thousands of them. We just debated the power of AI; maybe these are all going to be drafted by AI—who knows? If not, it could take a very long time.

I will just give one example of the complexity of this. If we think just about finance roles in schools and trusts, they could vary from the chief financial officer of a large trust to the chief operating and financial officers in medium-sized trusts who manage estates and technology, through finance directors of smaller trusts who might be more like executive business managers in larger trusts, and to finance directors in single-academy trusts who have a role not unlike a business manager in a maintained school, but with more accountability. Then we have finance managers, finance assistants, management consultants, senior management consultants, financial accountants, finance business partners, payroll managers—the list goes on. These are all in endless combinations that change over time as trusts and schools grow, shrink and change. The same is true for HR, technology, data and projects, as well as pastoral roles.

This illustrates that we are looking at a vast undertaking, and more importantly a needless one, given my Amendment 111A and the Government’s very welcome Amendment 112 and associated amendments that clarify that there cannot be an agreement that cuts the pay of a school support staff member. But any national framework that fails to acknowledge this reality risks becoming either so vague as not to be useful or too rigid to serve communities effectively. We have not had clarity yet from the Government about how this is going to be addressed in the real world.

We are also worried that there is no estimate at all for the additional costs that this approach will create for schools, and my Amendment 116B aims to address this. It seems extraordinary to introduce a measure that will increase costs to schools and costs to the public purse without working out how much that would be. I do not know whether the Minister can update the House on that point.

Our final concern is that the Government’s Amendment 112 will not fully address the ability of trusts to innovate and improve the terms for their support staff, which, rightly, the Government have as their priority for recruitment and retention. As I read it, it appears to say that new subsections (2) to (5), introduced by Schedule 4 on page 207, do not apply if each individual term and condition is to the advantage of the employee. I phrased that in a positive sense; the amendment is phrased the other way around.

Across the House, I hope we are keen that innovation around terms and conditions is possible where it provides an advantage to the employee in the round, but not necessarily looking at every element separately. For example, some trusts currently have a policy that everybody who joins in a child-facing role must either have or work towards achieving a level 3 qualification. That is clearly good for children. It leads to higher pay, which is good for the member of staff. But the duty on an employee to work towards a level 3 qualification is clearly a new requirement on that employee. My understanding is that anything that requires a person to acquire a qualification or undertake training is not defined as an improvement in their terms and conditions. An employee could reasonably say, “I don’t have to do that under the new national terms and conditions”, even where the unions think it is a good idea and other employees are in favour of it. So trusts would not be able to stick with such approaches, which benefit children and staff. I hope that the Minister can confirm that my understanding of this is right.

It is frequently the case that contracts for support staff in trusts are constructed very differently from those in the maintained sector. If contracts specify that hours, holidays, allowances, pay scales et cetera are set out in a completely different way from the SSSNB terms and conditions, but the overall impact is better for everyone, why would we want to rule this out?

The noble Baroness, Lady Smith of Malvern, kindly met the noble Lord, Lord Goddard, and me last week. She pointed out that school support staff are the only public sector workforce without a pay negotiating body. She is right about that but, if the Government are interested in the outcomes rather than the process, my amendments, particularly Amendment 111A, achieve their aims but avoid complexity and cost.

We believe that the Government have addressed the issue of setting a floor not a ceiling on pay, but, although I understand it is their intention to address innovation, the amendment as drafted does not address the reality of innovation and improvements of terms and conditions—hence my Amendment 111B. I hope that the Minister is able to be clear when she sums up that the Government agree with me and the noble Lord, Lord Goddard, and that we can find a way to address this effectively. I beg to move.

[Lord Hendy (Lab)]

My Lords, may I rather impudently congratulate the Government on their Amendments 112 to 116 and 117 to 119? In Committee, I moved a series of amendments to similar effect; namely, that the output of the negotiating body should not impose a detriment to existing terms and conditions and should permit any enhancement to existing terms and conditions by negotiation or otherwise. I am not so immodest as to imagine that there is any causal connection between my amendments in Committee and the appearance of these amendments on Report. I recall that the noble Baroness, Lady Noakes, also had amendments to similar effect; it may be that she had much more traction with my noble friends on the Front Bench than I had. Whatever the process—it is of course irrelevant—I congratulate my noble friends on the Front Bench for the introduction of these amendments, which make solid that this is a floor and not a ceiling.

[Lord Agnew of Oulton (Con)]

My Lords, I support my noble friend Lady Barran in her Amendments 111A, 111B, 116A and 116B. I have not spoken on the Bill before, so I refer noble Lords to my registered interests, in particular as a founder of a multi-academy trust with 18 schools and around 1,400 staff.

This new negotiating body—a central bureaucratic body dictating terms and conditions and pay for all to obey across our whole nation—literally drives us back to the 1970s. It would remove any ability to take note of local employment conditions. My own multi-academy trust completed a secondary school core structure review in 2022 and we have just finished the same review for our primary schools. We now have in place posts and grades that meet the needs of each school and, most importantly, those of our pupils.

We have set out a grading system to reflect the local conditions in which we operate. Primary and secondary staffing levels are strong and sustainable. The SSSNB would undo all this, and the cost of going through this new legislation would be bureaucratic and increase the overhead in our human resources. Administering these changes would take resources away from the front line with no meaningful benefit. I congratulate the Government on at least accepting that there is a floor to this whole arrangement, but it still leaves an extremely complicated central bureaucracy.

To provide good education we need flexibility. We operate harmoniously with our unions; we share a common mission and believe we have created a first-class cadre of support staff. Indeed, only two weeks ago, one of our support staff saved the life of one of our children, who had a cardiac arrest on a playing field when playing away. The local defibrillator had broken and he kept the child alive for 20 minutes.

I am looking at this whole Bill more widely. If we zoom out beyond the area of education, we start to see the impact of the aggressive anti-employer strategy being deployed by this Government. We have already seen the impact of VAT on private schools, with them going out of business and staff losing their jobs. We have already seen the escalation of employers’ national insurance and the widening of the bands, which has contributed to some 60,000 jobs being lost in the hospitality sector. Last week, we tried to warn the Government about the banter clause, which will drive another nail into the coffin of the hospitality sector.

Private sector employment market vacancies are under great pressure. At the beginning of last year, there were 900,000 vacancies and, by May this year, that was down to about 720,000. We heard earlier in the debate from the noble Lord, Lord Clement-Jones, on AI, and we are already seeing the impact of this—perhaps more dramatically in the US, where Microsoft has got rid of 15,000 staff in the last two months.

17:45

As my noble friend Lady Barran said, schools are under considerable financial pressure already. For me, the most frightening impact is the issue of persistent absence, where we particularly need non-teaching staff. For example, one of our schools in a very deprived area uses a retired taxi driver. How does he fit into this rigid new system? We use him because he knows the community; he has been ferrying people around that town for 30 years. He is the right person for that job. That would not necessarily apply in Tower Hamlets.

I plead for flexibility. I have been in business for—I am almost frightened to admit it—45 years. I hired my first employee in 1979. I have created thousands of jobs in the private sector over that time, and I can assure your Lordships that, for that to happen, one needs a flexible employment market. The SSSNB does the direct opposite of this.

[Baroness Wolf of Dulwich (CB)]

My Lords, I support Amendments 111A and 111B in the name of the noble Baroness, Lady Barran. I declare an interest as a governor of King’s College London Mathematics School and as a member of its finance and pay committees.

I have been trying to get my head around the implications of these clauses for support staff ever since the Bill was introduced. The more I think about it, the more unworkable it seems to be. As the noble Baroness pointed out, the complexity of support staff roles and the way they vary with different types of schools has become much greater in the last 20 years.

My experience is of a rather unusual 16-to-19 academy. We do outreach and projects in collaboration with charities and the university. We engage in a large number of things that are not about just standard school teaching. The standard scales for teaching staff are not a problem for us but, for support staff, we have specific roles that are suited to the particular activities in which people are engaged. We certainly pay as much as we can afford to; in the London market, we do not have much choice.

The point that I want to stress is that, while it is very welcome that the Government recognise that people’s pay should not be reduced as a result of this, the real problem is that there are huge numbers of important and central jobs and roles out there, which vary hugely according to the nature of the school, the nature of the environment and what people are doing. The complexity that this will introduce when we do our workforce planning and try to work out where a new role fits on these scales really worries me. I hope that, as things roll out, the Government think very hard about how to move forward in a way that allows successful schools, which are going beyond traditional classroom teaching and doing a huge number of important things, to continue to create support staff roles that fit what they are trying to do.

[Lord Storey (LD)]

My Lords, I declare an interest as a governor of King’s Leadership Academy in Liverpool. Schools face two challenges, some might say crises. First, the shortage of staff is becoming quite a serious concern. Secondly, there are real pressures on school budgets.

It was easy when all schools were local authority schools, because they all had the same framework and structures. We now have a very different landscape, which we all accept. There is no difference now in how we see that landscape. Half the schools are what I call maintained schools and the other half, with a preponderance towards secondary schools, are academies within large multi-academy trusts, which in a sense are bigger than the local authorities. The local authority where I worked for a number of years had 50 schools. There are multi-academy trusts with far more schools than that.

We want a system that is fair to all our non-teaching staff. We do not want to see anybody seeing a cut in their salary. But we also have to recognise that you have to have a system that is not bureaucratic and gives the freedom to schools in both cases to be able to do what is best for their staff. I fear that that will not be the case if the Government have their way. I am hopeful that the Minister will give us real reassurance on this.

I agree with the noble Baroness, Lady Wolf, that we have a more varied system, but I slightly disagreed with her when she said, “All schools, particularly the successful ones”. It is all schools, not just the successful ones, that will face difficulties.

[Baroness Wolf of Dulwich (CB)]

I totally agree with the noble Lord.

[Lord Storey (LD)]

So I hope that the Minister will really consider this. It is a huge issue. We cannot see our schools have to face more costs, and we do not want to see any staff disadvantaged by a well-meaning move by the Government.

[Lord Goddard of Stockport (LD)]

My Lords, we are dancing on the head of a pin with these amendments. The noble Lord, Lord Hendy, is right that these are welcome amendments that begin to address something I never knew anything about, which is that support staff have never had a baseline figure. That should be addressed.

I spoke to the Minister the day before yesterday or today—time flies—and the fact is that there are 520,000 of them. That is 52% of everybody employed at schools. That is more than teachers. Those support staff have a whole range of duties and the majority are tailored to their specific needs, as other speakers have said. Government Amendment 114 provides that, where an SSSNB

“has been unable to reach an agreement about a matter and the Secretary of State makes regulations about the matter, the regulations cannot alter a person’s terms and conditions of employment to make the person worse off, and do not prevent an employer from offering more favourable terms and conditions than those provided for by the regulations”.

We agree with that.

All that the amendment by the noble Baroness, Lady Barran, would change is that it would prevent

“the SSSNB from blocking employers who wish to adopt new or improved employment terms and conditions”,

provided that they meet the standards of minimum support. What we are trying to say here is, where they cannot come to a negotiation, the Government can step in by regulation, if that is what they want to do, but, where a body comes to an arrangement, why should you stop somebody wanting to offer more, above the floor and above the base—there is no argument about that; we all agree to the base—and say, actually, why would an SSSNB want to block some employer offering an employee better terms? If the Government reject this amendment, that is the alternative to what we are arguing.

If somebody wants to pay somebody more, above the base, that is surely better for the employee. Surely that is better than somebody saying, “Well, you can’t”, which is what the Government might do. The difference is quite subtle. Sooner or later, somebody will have to work out the maths for 520,000 people and then go to all those local authorities, academies and private schools, all of a sudden, as I have said before, there are bound to be winners and losers, unless you make set the level at a sufficiently high so there are no winners and losers. I cannot imagine what that number will be, because it will be a high number.

If this is about empowering people and lifting society, I am all for that. But, again, there is a level of detail. This is not a small group of people; it is an enormous number of people. It is more than the number of teachers. The teachers have had pay, and more pay, and are now going on strike for more money. Support staff do not do that. Support staff are vulnerable. They do not have that power to take industrial action to fight their corner. They negotiate their terms individually with local authorities and academies and, by and large, none of these people is paid below the minimum wage or the living wage. So, this is a bit of a sledgehammer to crack a nut.

I get the principle. I understand that there has been no base figure, and that should be addressed. But, if the Government are addressing that, and it is a philosophical Labour belief, they must put a price tag on it, because people need to know what the costs are, not only for their local authority but for every local authority and every academy in the country. If the noble Baroness is willing to push this to a vote—I do not know whether she will or will not—we on these Benches will support her.

[Lord Sharpe of Epsom (Con)]

My Lords, it is a pleasure to follow the noble Lord, Lord Goddard. I agree with pretty much all that he said. I thank my noble friend Lady Barran for her amendments. I thank my noble friend Lord Agnew for his interesting and timely perspective, and I salute the teaching assistant whom he mentioned.

Amendment 111B would ensure that the establishment of national frameworks does not, by accident or design, limit the ability of employers to go further in improving conditions for their staff. It makes it clear that, while national terms may set the floor, they must not become the ceiling.

As we have heard, we must leave space for innovation and ambition at the local level, particularly for those schools, academies and trusts that are actively seeking to lead in areas such as flexible working, staff well-being or enhanced support for recruitment and retention. This amendment does not undermine the national framework. On the contrary, it reinforces it, because it allows it to act as a strong foundation on which more can be built, where employers have the capacity and willingness to do so.

We should not inadvertently create a situation where the national body becomes a constraint rather than a support. I therefore welcome the clarity that this amendment brings. I commend my noble friend for bringing it forward and, if she decides to press it to a vote, we will support her.

[Baroness Jones of Whitchurch (Lab)]

My Lords, I will speak first to government Amendments 112 to 116. The school support staff negotiating body will recognise the essential roles and responsibilities of over 800,000 support staff working in our schools, supporting our children to achieve and thrive. Like the noble Lord, Lord Sharpe, I very much pay tribute to the teaching assistant whom the noble Lord, Lord Agnew, mentioned. We all know examples of support staff who have played significant interventionist roles in helping to run a school—roles that are often underrewarded and unrecognised. It is about time we put them and their pay and conditions on a proper footing.

It is right that we have a mechanism for employer and employee representatives to come together to negotiate and to agree pay and conditions that reflect the varied and vital role that support staff undertake. We have heard arguments made across the House that we must make the legislation itself clearer, that the SSSNB will not mandate a one-size-fits-all approach and that individual employees will be protected from any moves to their detriment as a result of the SSSNB process. We have listened to noble Lords on this issue and, while we have always been clear that this is the Government’s intent and can be achieved through existing provisions, we have decided to amend the SSSNB provisions to ensure that both principles are established in primary legislation.

This change will mean that all school support staff will benefit from a minimum offer—or floor—for pay and conditions, and that there will be no ceiling to prevent employers offering better pay or conditions. This protects individual employees and allows employers to go beyond agreements reached, should they choose to do so in response to their local circumstances. That was the argument made in Committee. A number of noble Lords argued that, particularly in academies, employers want to pay more and provide better conditions. We are making it clear that that is absolutely the right thing to do, and our amendments will deliver that.

I turn to the amendments tabled by the noble Baroness, Lady Barran. Amendment 111A would change the SSSNB’s remit for academies so that academy employers would be required to have regard only to the framework. As outlined in response to this amendment in Committee, it would be wrong to create a two-tier system for support staff. Since roughly half of the 22,000 state-funded schools in England are now academies, it is right that academies are included in the SSSNB’s statutory remit in the same way as maintained schools. There is no need to take a different approach for academies when there will be ample room for innovation for all schools, irrespective of their structure.

I hope the noble Baroness understands and agrees that all school support staff deserve to know what they can expect as a minimum for pay and conditions, and that they can continue to benefit from more favourable terms where employers offer them. However, her amendment risks creating a two-tier system that undermines the role of the new negotiating body in establishing minimum standards which will work for all schools and recognise the vital roles that support staff undertake.

18:00

Amendment 111B would prevent the SSSNB blocking employers who wish to adopt new or improved employment terms and conditions. I agree with the intent here, but the amendment is simply unnecessary. The government amendment I have just spoken about already prevents this. I know that the noble Baroness, Lady Barran, and the noble Lord, Lord Goddard, had a useful meeting on this with my noble friend Lady Smith, the Minister for Schools, in which this was explained.

Our amendment clearly establishes that, beyond a minimum offer, there will be flexibility for schools to offer more favourable terms for their support staff in response to local circumstances, and that individual employee contracts will need to change only if their terms or conditions are below the statutory minimum agreements arising from the SSSNB. This allows employers to retain contracts for their employees that contain more favourable pay and conditions that were agreed prior to the SSSNB regulations, or to agree more favourable pay and conditions through subsequent local negotiations.

Importantly, our amendment both protects individual employee entitlements and preserves flexibility for employers. The SSSNB will not mandate uniformity or add significant burdens to schools. Instead, it will mean that support staff in academies and maintained schools will all benefit from a minimum offer that is appropriate for the roles staff are undertaking in schools. It will also allow for greater consistency in the relationship between roles, training and pay, as agreed by those representing the interests of school support staff and their employers.

On Amendment 116A, as outlined in Committee, the costs associated with the SSSNB’s constitution are limited to administrative expenses and fees, which will be met by the department. It would therefore be disproportionate and unnecessarily restrict the flexibility to amend the constitution if the Secretary of State was required to publish an impact assessment and lay it before Parliament before making or revising these constitutional arrangements.

Amendment 116B would require the SSSNB’s annual reports to include an assessment of the increased costs to the education sector of pay and conditions agreements made in that reporting year. The Secretary of State will specify what the SSSNB needs to consider, such as the cost implications and practical considerations for schools, when remitting the SSSNB. Of course, employers will also have a voice on that body to ensure that their interests and the costs they are concerned about are taken into account.

Assessing the cost implications and affordability for the education sector of agreements reached by the SSSNB on pay and conditions will be important for the Department for Education prior to the Secretary of State ratifying any agreements. The Secretary of State has the power to refer matters back to the SSSNB or to issue alternative regulations should the agreements not be practicable. This is the fail-safe that I think the noble Baroness is looking for. It would not be appropriate to specify in primary legislation that these assessments will be contained in annual reports to be produced by the SSSNB. We anticipate that the Department for Education will be better placed to undertake assessments than the SSSNB itself and to decide whether they should be implemented.

Government Amendments 117 to 119 and 122 are intended to have the same effect for the social care negotiating bodies as amendments in my name to the SSSNB clauses. It is critical to this Government to provide better care to people in their own homes and in the communities where they need it. These provisions will help to ensure that care professionals are recognised and rewarded for their important work. There were 1.59 million people working in the adult social care sector in England in the financial year 2023-24.

As such, we are introducing amendments to ensure that changes to workers’ pay and conditions as a result of an agreement or regulations being implemented would be only to their benefit. These amendments also make it clear that employers can offer more favourable terms and conditions than those provided for by an agreement or in equivalent regulations, including through local collective agreements. This will incentivise employers to compete when attracting talent.

Finally, I turn to government Amendments 120 and 121. We are always grateful to the Delegated Powers and Regulatory Reform Committee for its excellent work, and we concur with its statement that

“it is heartening that in a Bill with so many delegated powers it has only found four on which to raise concerns”.

We wish to improve its assessment still further with our amendments to Clause 46. These will ensure that the substantive content of guidance and codes of practice is subject to parliamentary scrutiny in the appropriate legislature where regulations set out consequences for failing to comply with a duty in relation to the guidance or code.

The measures being introduced here are major reforms, creating new structures to address major problems in the social care sector. As such, our drafting has needed to evolve over time and respond to new issues raised as we build this process. We are happy to accept the committee’s feedback and we hope to reassure your Lordships’ House of our commitment to provide Parliament with appropriate oversight.

Before I move en bloc the government amendments laid in my name, I ask the noble Baroness, Lady Barran, to withdraw Amendment 111A.

[Baroness Barran (Con)]

My Lords, I thank all noble Lords who contributed to this short but important debate. My noble friend Lord Agnew, the noble Baroness, Lady Wolf, and the noble Lord, Lord Storey, gave good, practical examples of the risk of this approach and of undoing some of the good and innovation that have happened in the sector over several years.

The noble Lord, Lord Goddard, said he thought we might be dancing on the head of a pin. He may be right, but there is a fundamental principle at the heart of this, which seems to differ between the Department of Health and the Department for Education, about the amount that you trust leaders in the sector to take these decisions. We have seen really positive change in the education sector in relation to school support staff as a result of innovation and of delegation to school and trust leaders. We on these Benches regret that recentralisation very much, and what appears to be a change and diverging policies between two government departments.

The Minister said that we would not have a one-size-fits-all approach. I tried to be clear in my remarks that we will not have a one-size-fits-all approach; that clearly cannot happen. We will have several thousand sizes, and that is just unworkable. I know the Minister does not agree, but I think that is the reality.

The Minister talked about ample room for innovation but not wanting a two-tier system. I find it hard to follow the logic. If we have enough room for flexibility, by definition, there will be evolution. There will be a floor but, rightly, there will be differences in different areas.

I understood the Minister to say—she will correct me if I misunderstood—that the Government would cover any costs associated with these changes. I remind her that the Government imposed the new employers’ national insurance contribution and have not covered all the costs for schools. Schools are having to try to cover part of it themselves. I hope that, in this case, we can take her word literally that it will be 100% of the cost.

One the one hand, I do not think we disagree about innovation, but on the other the Minister did not address the two examples I gave of where it is the package of conditions that is innovative and to the advantage of an individual employee. Her Amendment 112 seems to me—I am not a lawyer—to have been extremely carefully framed. It says:

“Subsections (2) to (5) … do not apply in relation to a term or condition”—


that is singular—

“to the extent that, giving effect to the agreement would alter the term or condition to the person’s detriment”.

It goes on in new paragraph (b) to say,

“do not prevent the terms and conditions”—

plural—

“of a person’s employment from including a term or condition”,

here it is singular,

“that is more favourable to the person than that which would otherwise have effect”.

When I talk to leaders in the sector, they are worried. They put together a package of conditions. I gave the example of where someone has a requirement to reach a level 3 qualification and is then entitled to higher pay, which benefits children and that individual. The Minister did not address that point, and I am left not with a concern that we want a different thing, although I have a nagging doubt that this phrasing would exclude that, but with the reality that, as drafted, we need my Amendment 111B. I shall test the opinion of the House when we come to that amendment. I beg leave to withdraw Amendment 111A.

Amendment 111A withdrawn.

Amendment 111B

Moved by

[Baroness Barran]

111B: Schedule 4, page 201, line 18, at end insert—
“(3) The SSSNB must not restrict employers from introducing innovative or improved terms and conditions of employment beyond the national framework, provided that such terms meet or exceed any minimum standards set by the SSSNB.”Member's explanatory statement
This amendment prevents the SSSNB from blocking employers who wish to adopt new or improved employment terms and conditions.

18:12

Division 1

Ayes: 266

Noes: 162

18:23

Amendments 112 to 116

Moved by

[Baroness Jones of Whitchurch]

112: Schedule 4, page 207, line 17, at end insert—
“(6) Subsections (2) to (5)—(a) do not apply in relation to a term or condition of a person’s employment if, and to the extent that, giving effect to the agreement would alter the term or condition to the person’s detriment; (b) do not prevent the terms and conditions of a person’s employment from including a term or condition that is more favourable to the person than that which would otherwise have effect by virtue of those subsections.”Member's explanatory statement
This amendment provides that an agreement of the School Support Staff Negotiating Body cannot alter a person’s terms and conditions of employment to make the person worse off, and does not prevent an employer from offering more favourable terms and conditions than those provided for by the agreement.

113: Schedule 4, page 207, line 29, after “apply” insert “(but see subsection (8))”
Member's explanatory statement
This amendment is consequential on my amendment of Schedule 4 at page 208, line 4.

114: Schedule 4, page 208, line 4, at end insert—
“(8) Subsections (4) to (7)—(a) do not apply in relation to a term or condition of a person’s employment if, and to the extent that, giving effect to the regulations would alter the term or condition to the person’s detriment;(b) do not prevent the terms and conditions of a person’s employment from including a term or condition that is more favourable to the person than that which would otherwise have effect by virtue of those subsections.”Member's explanatory statement
This amendment provides that, where the School Support Staff Negotiating Body has been unable to reach an agreement about a matter and the Secretary of State makes regulations about the matter, the regulations cannot alter a person’s terms and conditions of employment to make the person worse off, and do not prevent an employer from offering more favourable terms and conditions than those provided for by the regulations.

115: Schedule 4, page 208, leave out lines 8 to 14
Member's explanatory statement
This amendment is consequential on my amendment of Schedule 4 at page 208, line 4.

116: Schedule 4, page 208, line 22, leave out “(7)” and insert “(8)”
Member's explanatory statement
This amendment is consequential on my amendment of Schedule 4 at page 208, line 4.

Amendments 112 to 116 agreed.

Amendments 116A and 116B not moved.

Clause 44: Effect of regulations ratifying agreement

Amendment 117

Moved by

[Baroness Jones of Whitchurch]

117: Clause 44, page 66, line 22, at end insert—
“(5) Subsections (2) to (4)—(a) do not apply in relation to a term or condition of a social care worker’s employment if, and to the extent that, giving effect to the agreement would alter the term or condition to the social care worker’s detriment;(b) do not prevent the terms and conditions of a social care worker’s employment from including a term or condition that is more favourable to the social care worker than that which would otherwise have effect by virtue of those subsections.” Member's explanatory statement
This amendment provides that an agreement of a Social Care Negotiating Body cannot alter a person’s terms and conditions of employment to make the person worse off, and does not prevent an employer from offering more favourable terms and conditions than those provided for by the agreement.

Amendment 117 agreed.

Clause 45: Power of appropriate authority to deal with matters

Amendments 118 and 119

Moved by

[Baroness Jones of Whitchurch]

118: Clause 45, page 67, line 2, after “apply” insert “(but see subsection (8))”
Member's explanatory statement
This amendment is consequential on my amendment of clause 45 at page 67, line 10.

119: Clause 45, page 67, line 10, at end insert—
“(8) Subsections (5) to (7)—(a) do not apply in relation to a term or condition of a social care worker’s employment if, and to the extent that, giving effect to the regulations would alter the term or condition to the social care worker’s detriment;(b) do not prevent the terms and conditions of a social care worker’s employment from including a term or condition that is more favourable to the social care worker than that which would otherwise have effect by virtue of those subsections.”Member's explanatory statement
This amendment provides that, where a Social Care Negotiating Body has been unable to reach an agreement about a matter and the appropriate authority makes regulations about the matter, the regulations cannot alter a person’s terms and conditions of employment to make the person worse off, and do not prevent an employer from offering more favourable terms and conditions than those provided for by the regulations.

Amendments 118 and 119 agreed.

Clause 46: Guidance and codes of practice

Amendments 120 and 121

Moved by

[Baroness Jones of Whitchurch]

120: Clause 46, page 67, line 27, at end insert—
“(3A) Regulations under this section that by virtue of subsection (2)(b) make provision about the consequences of a failure to comply with a duty imposed by the regulations in relation to a provision of guidance or a code of practice must provide for the guidance or code to be laid before the appropriate legislature and subject to the procedure specified.”Member's explanatory statement
This amendment provides that, where regulations under clause 46 provide for the issuing of guidance or a code of practice by the Secretary of State, and make provision about the consequences of a failure to comply with a duty imposed in relation to the guidance or code, the regulations must provide for the guidance or code to be laid before Parliament and to be subject to the procedure specified in the regulations. The amendment also imposes an equivalent duty in relation to regulations made by the Welsh Ministers or Scottish Ministers.

121: Clause 46, page 67, line 28, after “section” insert “—
“the appropriate legislature” means—(a) in the case of regulations of the Secretary of State, Parliament;(b) in the case of regulations of the Welsh Ministers, Senedd Cymru;(c) in the case of regulations of the Scottish Ministers, the Scottish Parliament;”Member's explanatory statement
This amendment is consequential on my other amendment of this clause.

Amendments 120 and 121 agreed.

Clause 49: Regulations under section 43 or 45: supplementary

Amendment 122

Moved by

[Baroness Jones of Whitchurch]

122: Clause 49, page 69, leave out lines 13 to 19
Member's explanatory statement
This amendment is consequential on my amendment of clause 45 at page 67, line 10.

Amendment 122 agreed.

Amendment 122A

Moved by

[Lord Hendy]

122A: After Clause 53, insert the following new Clause—
“Statutory rights of GB-linked ships’ crews(1) The members of the crew of a GB-linked ship shall be entitled to the statutory rights to which employees in the UK are entitled under statute.(2) In this section, “GB-linked ship” means a ship providing a service—(a) for the carriage of persons or goods, with or without vehicles, and(b) that is within subsection (3) or (4).(3) A service is within this subsection if it is operated between a place in Great Britain and another place in the United Kingdom.(4) A service is within this subsection if—(a) ships providing the service entered a harbour in Great Britain on at least 120 occasions in the period of 12 months ending with the day on which one or more of the statutory rights referred to in subsection (1) is claimed, or(b) 15 if the service has been provided for less than 12 months before that day, ships providing the service entered a harbour in Great Britain on at least 10 occasions in each month for which the service has been provided.(5) But a service is not within subsection (4) if the service—(a) is for the purpose of leisure or recreation, or(b) is provided by a fishing vessel.(6) In this section—“harbour” has the same meaning as in the Harbours Act 1964;“ship” has the same meaning as in section 193A of the Trade Union and Labour Relations (Consolidation) Act 1992 (see subsection (4) of that section).” Member's explanatory statement
This new clause is intended to extend entitlement of the rights of GB-linked ships’ crews from the right to collective redundancy notification in clause 29 to entitlement to all statutory rights enjoyed by UK employees.

[Lord Hendy (Lab)]

My Lords, the purpose of this amendment is to probe the extent to which the new category of seafarers, “GB-linked ships’ crews”, should benefit from other employment rights apart from the one bestowed by the Bill, which gives them a right in relation to consultation over collective redundancies, as a consequence of the P&O Ferries scandal. I understand that there have been discussions between the unions representing these seafarers and the ministerial team. In the light of that, I shall leave it to the Minister to set out the situation. I beg to move.

[Lord Davies of Brixton (Lab)]

Having raised these issues at the beginning of Committee, I just want to say that, following the favourable response of the Front Bench to the idea of arranging a meeting at which they can be discussed, I very much look forward—at least, I hope I can—to the reply of my noble friend the Minister.

[Baroness Jones of Whitchurch (Lab)]

My Lords, I thank my noble friend Lord Hendy for moving his amendment.

Amendments 123 and 124 in my name relate to Clause 54, which provides powers to make regulations giving effect to two named international conventions and to give effect to international agreements as they relate to maritime employment. I thank the Delegated Powers and Regulatory Reform Committee for its thoughtful consideration of these powers, and its recommendation to amend the procedure for new Section 84A(2) from first-time affirmative to affirmative for all uses. I wrote to the committee on 7 July, setting out our response in full.

These amendments will change the parliamentary procedure applicable to regulations made under the power in new Section 84A(2) of the Merchant Shipping Act 1995, giving effect to international agreements as they relate to maritime employment. The amendments mean that all uses of the power to give effect to future or unspecified international agreements will now be subject to the affirmative procedure, and not just the first use. They will mean that Parliament has greater oversight of these agreements and amendments to them.

I turn to Amendment 122A tabled by my noble friend Lord Hendy. The amendment would specify that the statutory rights to which shore-based workers in the UK are entitled also apply to ships’ crews working aboard services that enter ports in Great Britain 120 or more times per year, or that operate

“between a place in Great Britain and another place in the United Kingdom”.

The scope of services covered follows the approach taken in Clause 29, where the Government have sought to ensure that those employed aboard these services are captured by the requirement to provide proposed notification of collective redundancy.

I thank my noble friend for this amendment on the application of employment rights to seafarers, and the maritime trade unions for their continuing engagement on these issues. I hope to be able to provide some clarity today, but we can also commit to continuing ongoing discussion about how we can ensure that seafarers are receiving robust protections.

The Government want to see stronger employment rights for seafarers. That is why, in addition to the broader changes to employment rights, we have included a package of maritime-specific measures in this Bill. As my noble friend knows, we are closing the loophole that meant that P&O Ferries could avoid prosecution for failing to provide advance notice of proposed collective redundancies. We are also providing powers for a mandatory seafarers’ charter, which will allow us to set a higher minimum standard for wages and for how long seafarers can spend at sea without a break. This will establish a level playing field that will help prevent the undercutting of working conditions in the way that P&O Ferries sought to do.

The new power to give effect to the Maritime Labour Convention, and other international agreements as they relate to maritime employment, is also important. Where international agreement is needed to improve protections, we can implement those changes.

18:30

In relation to broader employment rights. It is important to note that many seafarers with strong connections to Great Britain are already entitled to British employment rights and would be entitled to protections in the Bill. This would include seafarers who ordinarily work in the territorial waters of Great Britain. The courts would also consider how seafarers who spend some time working outside GB would be covered. These legal tests ensure that those seafarers who have such a strong connection that they would expect to be covered by GB law are indeed protected.

While we appreciate the intention behind the amendment, as drafted it is very broad and would apply a wide but uncertain range of rights on to seafarers with varying levels of connection to Great Britain, spanning across a significant number of different pieces of legislation. Accepting the amendment without undertaking a proper review of the consequences of this across all the relevant legislation would run the risk of unintended consequences for seafarers. It could not only disapply certain rights from seafarers who currently receive them but force UK employment protections on those who wish to be covered by a different jurisdiction, depending on the interpretation of the courts. Applying the “frequency of port calls” test to all statutory rights is not the same as applying it to the collective redundancy measure, on which the amendment is based, or the Seafarers Wages Act, which is also based on port calls. Neither of these measures confer any individual rights on to seafarers, and the mechanism was carefully designed to ensure compliance of these specific measures with international law.

Since the amendment would confer individual rights on seafarers working on non-UK flagged ships that would be enforceable in UK courts, it is important that we consider the legal consequences of this. In particular, we would need to carefully consider the international law implications. It is important that we chart the right course between protecting seafarers connected to the UK and making sure that our framework is legally robust.

For the reasons set out, we cannot accept the amendment as drafted. It would have far-reaching implications that would need proper consideration and scrutiny of the issue. As I say, the risk of unintended consequences is too great, and it could undermine the progress for seafarers that we have made through the carefully designed measures in the Bill. However, we appreciate the intention behind the amendment. I assure noble Lords that this Government are committed to protecting seafarers, and we will continue to work with ambition and determination to advance seafarers’ rights, internationally and domestically.

We would welcome the opportunity to continue the extensive engagement that we have already undertaken with the unions and industry about the application of employment protection to seafarers. The Maritime Minister recently met the RMT and undertook to continue dialogue on this matter. He would be happy to meet the RMT again following official-level discussions to explore how we could secure the objectives behind my noble friend’s amendment. With that, I ask my noble friend to withdraw Amendment 122A.

[Lord Hendy (Lab)]

My Lords, in the light of my noble friend the Minister’s recognition of the shortfall in employment rights for seafarers and the commitment to continued engagement with the maritime unions, and indeed employers, to discuss the ways in which the intent behind the amendment might be ultimately achieved, I am happy to beg leave to withdraw the amendment.

Amendment 122A withdrawn.

Clause 54: International agreements relating to maritime employment

Amendments 123 and 124

Moved by

[Baroness Jones of Whitchurch]

123: Clause 54, page 73, line 32, leave out from “84A(2)” to end of line 34
Member’s explanatory statement
This amendment, together with my other amendment of this clause, provides that regulations under new section 84A(2) of the Merchant Shipping Act 1995 giving effect to international agreements relating to maritime employment will be subject to the affirmative resolution procedure.

124: Clause 54, page 73, leave out lines 37 to 42
Member’s explanatory statement
See the explanatory statement for my other amendment of this clause.

Amendments 123 and 124 agreed.

Amendment 125

Moved by

[Lord Sharpe of Epsom]

125: After Clause 54, insert the following new Clause—
“Right to opt out of collective agreements(1) A worker who is not a member of a trade union may elect, in writing, to opt out of the terms of a collective agreement that would otherwise apply to them under this Act. (2) In such a case, the worker shall be entitled to rely on the statutory rights conferred by this Act without reference to the collective agreement.”Member’s explanatory statement
This amendment provides non-union workers with the right to opt out of collective agreements, reinforcing individual freedom of contract and protecting access to statutory entitlements.

[Lord Sharpe of Epsom (Con)]

My Lords, Amendment 125 in my name speaks to a fundamental principle that we should run through every piece of employment legislation that we consider, and that it is the right of the individual to determine their own path.

Too much of the Bill rests on an implicit and rather patronising assumption that workers are somehow incapable of managing their own affairs—that they must be corralled, collectively represented, spoken for and ultimately told what is best for them. This amendment challenges that assumption head on. It affirms the right of a worker who is not a union member to say that they wish to stand on their own two feet and do not wish to be bound by collective agreements that they had no part in negotiating and no say in accepting. That is not anti-union; it is pro-choice and pro-individual. If we believe in personal responsibility then we must also believe in personal freedom. Some workers are independent-minded individuals, who want to make their own decisions about their pay and their terms and conditions.

We have to be clear: statutory rights remain in place. This amendment would do nothing to undermine minimum standards; it would simply allow the worker to rely on those rights without being bound by a collectivist framework that they never opted into. That is not a threat to fairness but the definition of fairness.

The Government treat workers as a monolith. They are defined not by merit or initiative but by membership and conformity. This proposed clause offers a quiet but powerful alternative: that the individual workers matter, that their preferences matter, and that freedom of contract is not some abstract legal concept but a cornerstone of liberty. I beg to move.

[Lord Hendy (Lab)]

My Lords, before I speak to my Amendment 127, I will say a few words about Amendment 125, from the noble Lord, Lord Sharpe. He and other noble Lords on that side of the House often accuse those on this side of ignorance of business, but his amendment shows ignorance of what happens in industrial relations on the ground.

I will make three points. First, there is nothing in the law to prevent an employer and an individual employee agreeing an improvement to terms and conditions on an existing collective agreement, save in exceptional circumstances such as that illustrated by the case of Wilson and Palmer v the United Kingdom, where the employer offered to pay workers a higher rate of pay if they surrendered their union membership. That principle would also apply to prevent the penalisation of workers on the grounds of any other protected characteristic. However, as a general principle, workers and employers can agree to improve on an existing collective agreement.

Secondly, why would an individual employee agree to detrimental terms worse than an existing collective agreement—lower wages, longer hours, fewer holidays, fewer breaks, and worse terms and conditions? There can be no reason why a worker would wish not to abide by the existing collective agreement. Employees need protection against bad employers who might otherwise exploit the proposed loophole by saying to an individual employee, “I want you to opt out of the collective agreement”, hence undermining it.

Thirdly, collective agreements are not dictated by the trade unions but are agreed by an employer and, usually, by a vote of the employees. We need more negotiation and less litigation.

With that, I turn to my Amendment 127, which is intended to provide my noble friend the Minister and the Secretary of State with a mechanism to promote and encourage collective bargaining on a sector-wide basis without prescribing in detail the model to be deployed. It would be used when needed and would not compel the Government to put it into operation. I will not repeat the arguments about collective bargaining that I developed in Committee over the course of three speeches, but I think I may be permitted to summarise the gist of those arguments in six points.

First, the Bill makes commendable reforms to the legal machinery to establish collective bargaining between trade unions and a single employer, but there is no mechanism in the Bill or anywhere else for multi-employer collective agreements or sector-wide collective agreements.

Secondly, sectoral collective bargaining was the norm for the United Kingdom from 1918 until 1990. It established a coverage of over 80% of British workers between 1945 and the late 1980s. The percentage of workers covered by collective agreement has now declined to 25%. That means that three-quarters of our workforce are employed on “take it or leave it” terms, without any possibility of negotiating anything better than that which the employer offers.

Thirdly, 80% collective bargaining coverage is curiously—or coincidentally—the level now set for the 27 member states of the European Union, after two decades during which the EU undermined sectoral collective bargaining. That policy was reversed in 2024 by means of a directive. Collective bargaining is now advocated by the OECD, since 2017, the IMF and, of course, the ILO.

Fourthly, Labour’s Green Paper, A New Deal for Working People; its subsequent publication on making work pay, implementing the new deal for working people; Labour’s election manifesto; and the King’s Speech all endorsed the extension of collective bargaining.

Fifthly, I come to the benefits of sectoral collective bargaining, which need spelling out again. There are at least eight benefits, as I identify them. The first is that sectoral collective bargaining increases wages. Let us recall that the real value of wages has risen only 0.5% in the past 20 years. Secondly, a rise in wages increases demand in the economy—demand for the goods and services produced by employers. Thirdly, collective bargaining contracts the differentials that have emerged: the gender pay gap, the ethnic-minority pay gap, the disability pay gap and so on. Fourthly, by increasing wages, collective bargaining diminishes the need for state benefits by way of subsidy to low wages. Let us not forget that 31% of those in receipt of universal credit are in work, which gives an indication of the lowness of wages in this country. Fifthly, increasing wages increases the Government’s tax take, which diminishes the need to find money elsewhere. Sixthly, sectoral collective bargaining prevents employers undercutting each other on labour costs. Seventhly, the other side of that coin is that it encourages employers to compete on productivity, investment, efficiency and innovation. Eighthly—this is an important point—it achieves a form of democracy at work. It gives workers a say in the terms and conditions on which they work.

I said there were six points, and the sixth and final point is one of particular interest to me as a lawyer. It is the observation that the rule of law plays a part here. The rule of law, Lord Bingham’s eighth principle, is that states must abide by the treaties they have ratified. That principle has been endorsed in almost every speech I have heard my noble and learned friend Lord Hermer KC, the Attorney-General, give since his appointment to that office. This is significant because International Labour Organization Convention No. 98 and Article 6.2 of the European Social Charter 1961 impose the duty on ratifying states, which includes the United Kingdom, not just to permit collective bargaining but to promote and encourage it. The Bill was the opportunity to promote and encourage collective bargaining at sectoral level, but it does nothing to do so in any sector of the economy.

18:45

I remind the House that I previously quoted these short sentences from the European Committee of Social Rights, which held that

“if the spontaneous development of collective bargaining is not sufficient, positive measures should be taken to facilitate and encourage the conclusion of collective agreements”

and that

“where only 30% of the total number of employees are covered by collective agreements, voluntary negotiations are not sufficiently promoted in practice”.

The United Kingdom is now significantly below 30% of collective bargaining coverage. In many sectors, collective bargaining is not, to use the words of the committee, spontaneously developing: one has only to think of agriculture, food and parcel delivery, hospitality, social care and so on.

I have not forgotten the adult social care negotiating body or the school support staff negotiating body but, for reasons I set out at length in Committee and will not repeat, those bodies do not constitute collective bargaining and cannot be extended to other sectors. They are not collective bargaining, first, because the Act says they are not; secondly, because the parties have no autonomy over the subject matter, membership or procedure; and thirdly, because the Minister can overwrite the agreement or non-agreement. I therefore urge my noble friend the Minister to accept the offer of this machinery, which the Bill can keep in its back pocket until needed.

[Baroness O'Grady of Upper Holloway (Lab)]

My Lords, I will speak to Amendment 127 in the name of my noble friend Lord Hendy, but I am conscious that some of my comments may also be relevant to Amendment 125, which I oppose.

According to the latest LFS figures, 6.4 million people hold a union card, making trade unionism by far the largest democratic membership movement in the UK. Many of Britain’s most innovative companies recognise trade unions and the real value that an independent voice for workers adds, including Rolls-Royce, Uber, Virgin Media and EDF Renewables, to name but a few.

We have heard on several occasions how union membership has declined since the 1980s, and no doubt we can debate the reasons for that. But it is also worth recording that the ONS’s annual survey of hours and earnings, which is a survey of employers, shows that today the pay of more than four in 10 jobs in the UK is set with reference to a union agreement. In other words, collective bargaining still sets the pace for the pay and conditions of a substantial part of the workforce, well beyond union membership—but expanding collective bargaining coverage has never been more urgent.

OECD analysis shows that the UK has one of the highest levels of income inequality in Europe. The picture on wealth inequality is even worse. That is bad for society and a brake on fair growth. It is not just about the families who work all the hours God sends yet still rely on benefits and food banks, or that under the previous Government living standards stagnated for 15 long years, or that the real threat to the survival of pubs, hospitality and small businesses on the high street is the prolonged squeeze on disposable income that has hammered consumer spending. It is more than that.

Ever since the previous Government’s austerity cuts, Brexit, and then Covid, there has been growing public anger that sacrifice has not been equally shared. The so-called trickle-down theory of economics has proven to be an elaborate con. To take one glaring example, in the financial year from 2023, the CEO of the outsourced services giant Mitie was paid nearly £15 million. That is 575 times that of a median worker at the company. I challenge any noble Lord to justify that.

Some noble Lords opposite may not like what trade unions stand for. In the other place, their party joined Reform in voting against better sick pay, an end to exploitative zero-hours contracts, and protection against fire and rehire. But when it comes to collective bargaining, I have yet to hear the Opposition come up with a better plan for workers so that workers can win a fairer share of the wealth that, after all, they helped create. Perhaps we can hear an alternative today.

In the meantime, as we have heard, the evidence is clear: when individual workers combine their working power, they are much more likely to win better pay, safety, skills training, family-friendly policies, workforce engagement and, ultimately, higher productivity—a good deal for workers and for their employers.

I congratulate my noble friend the Minister on the Government’s plan to reinstate the school support staff negotiating body and to establish a fair pay agreement for social care. This could be transformative, not only for the workforce but for the service and everyone who relies on its dedicated care. But we cannot stop there. We can debate the detail, but at the heart of my noble friend Lord Hendy’s amendment is the objective to spread the benefits of collective bargaining to more sectors of the economy. That would provide a level playing field for business, lift living standards, improve workforce well-being and boost company productivity, which in turn would aid fair growth.

In her response to the debate in Committee on 5 June, my noble friend Lady Jones, the Minister, said that the Government

“intend to learn from the first fair pay agreement process … before considering rolling out agreements in other areas”.—[Official Report, 5/6/25; col. 943.]

I understand the concern to learn from the success of the commitments already contained within the Bill, but it would seem sensible to take powers to introduce more sectoral agreements now, so that the Government are ready to act quickly in the future.

I know that the Government understand the absolute urgency of the need to tackle inequality in this country, to get living standards rising and to boost business investment in skills and productivity. Sectoral collective agreements are one of the quickest, most flexible and most effective ways to do just that. But, in the meantime, will my noble friend the Minister kindly undertake to facilitate a meeting with the relevant Cabinet Office Minister to explore how government procurement social value rules can promote fair work and a collective voice for workers?

[Lord Monks (Lab)]

My Lords, I am grateful to my noble friend Lord Hendy for directing our attention to collective bargaining, its historic importance in our national life and its relevance today.

Many in this Chamber today might know that the hero of establishing that collective bargaining system, which has been talked about by others, in 1928 was Stanley Baldwin, who was concerned about the excesses in the boardrooms of Britain. He regarded a lot of directors as profiteers. He promoted collective bargaining and trade unions as an antidote to that kind of greed. We now have another era of excessive boardroom remuneration and, in the absence of strong collective bargaining, too many boards do not seem restrained at all by the possible reaction of their workforce—and, boy, do they take advantage. More collective bargaining would help check this greed.

A start has been made. I will not go into the technicalities, but a start is made in the Bill’s provisions on fair pay agreements, including in the social care and school support staff sectors. We need a major step-up in British employment relations. We need a new system to improve productivity, investment and training. We need a new system based not on short-termism but on respect and investment in skills and capital. We need a new system which puts “them and us” behind us and bases itself on priorities, consultation and more equality.

Once this Bill—which does rebalance relations in this country to a considerable extent—is put to bed I ask the Government to go further and build an ambitious system which raises the national game. We can all do better in this country.

[Baroness Verma (Con)]

My Lords, in response to the amendments from the noble Lord, Lord Hendy, I want to explore the fact that we currently have strong representation from the unions. We have seen, through recent strikes, that there is an ability to go out there and voice your opinion.

My worry—I would like to have this recorded—as a businessperson, as my registered interests lay out, is that most of the businesses impacted will be SMEs, which are already predominantly very good employers. Most small and medium-sized businesses work with their workforce. We all wish to do well because we want better productivity, and it is not in our interests not to do so.

I remind noble Lords that my own grandfather was one of the founders of the Indian Workers’ Association because, at that time, unions were not properly representing minority communities. My worry is that we are going to go back to a place where people from minority communities, who do not actually know whether they have a choice to be part of a union or not, will have to come back into a union—whether or not they know that they are a member. I want to know from the noble Lord, Lord Hendy, how that would be clarified. There will be many from minority communities who work incredibly hard, are ambitious and aspirational, and want to end up owning their own business, who find that working and learning from employers is the best way to do it.

I fully support my noble friend’s amendment because I think that the world has moved on so much. Technology has enabled us to do so many things differently so that we are far more able to hold employers to account. There is no place to hide for bad employers. I do not think that the amendment from the noble Lord, Lord Hendy, will actually make a lot of difference to today’s workforce, as we are using a lot of new technologies to be able to make sure that the workplace is a much fairer place.

[Lord Hendy (Lab)]

I do not really recognise the workplace that the noble Baroness describes. The fact of the matter is that only some—

[Lord in Waiting/Government Whip (Lord Katz) (Lab)]

I think I am right in saying the Companion says that the noble Lord is not allowed to speak twice in the debate as he has not moved the amendment.

[Lord Balfe (Con)]

Maybe I could say what I think the noble Lord, Lord Hendy, was going to say. The workplace is not necessarily quite as put. Both my grandmothers were businesspeople in their own right, with small businesses. The one we always call my English grandmother—because she was not the Irish one—was asked towards the end of her life whom she thought were the best politicians. She, rather like her grandson, had managed to vote for all the parties before she died. She said that the greatest politician in Britain was Stanley Baldwin, because he cooled down Britain after the general strike and, as she used to put it, he got rid of our Nazi King. So I have a lot of time for Stanley Baldwin. He is also one of my heroes, and the fact of the matter is that this is a thoroughly good amendment. Collective bargaining is a thoroughly good thing, and I hope I have not misrepresented too much what I think my friend was about to say.

19:00

[Lord Berkeley (Lab)]

I want to intervene very briefly to reflect on the difference between the debate this afternoon and the debate we had at the time of the P&O disaster—I call it a disaster for all the people who were basically sacked. It was very difficult to get information about what was right and what was wrong, and who was their employer. We were fed a load of, frankly, bad information from the company, and we got some good information from the trade unions.

Let us just reflect, however, on what my noble friends Lord Hendy and Lady O’Grady said about how things have changed. It would have been wonderful if we had heard their speeches before we debated P&O, because the problem is still just as bad and still needs resolving. I am very glad to welcome these two people in particular, and I hope we will hear much more from them.

[Baroness Lawlor (Con)]

Will noble Lords allow me to say a word in support? I was a little late coming in because I misread the screen; I thought we were on Amendment 122. I support my noble friend’s Amendment 125 because it would reinforce the individual freedom of the workplace and the freedom of contract, and it would protect access to statutory rights. I say this in response to some of the points made about what other arrangements could be in place. I will refer to one law firm commenting on the importance of freedom of contract in our laws. It reflected—

[Lord Katz (Lab)]

I apologise for interrupting the noble Baroness in full flow. She said she was not here for the start of the debate on the group, so it would be a courtesy to the House to leave it at that.

[Lord in Waiting/Government Whip (Lord Leong) (Lab)]

My Lords, I thank all noble Lords who spoke—my noble friends Lord Hendy, Lady O’Grady, Lord Monks and Lord Berkeley, and the noble Baroness, Lady Verma.

The noble Lord, Lord Sharpe of Epsom, tabled Amendment 125, which seeks to give workers the right to opt out of collective agreements. Workers are free to join or not to join a trade union. It is their choice. They are not compelled to pay any union subscriptions, or any part thereof, where a union is recognised by the employer for collective bargaining purposes—so they do not need to pay any union subscription or join a union.

Many employers choose to recognise a union voluntarily. One advantage of trade union recognition is that this enables the employer to negotiate collective agreements, the terms of which may apply to all workers in a workplace. My noble friend Lord Hendy explained so clearly the principles of collective agreements—he said all that I needed to say.

The application of the terms of collective agreements to workers generally depends, in any event, on incorporation of those terms into the workers’ contracts, either expressly or by implication. That is the normal position. But providing some individual workers with a new statutory right to withdraw from the provisions agreed under a collective agreement, even where they can rely on statutory entitlements, would create an unnecessary risk of a multi-tier system, with workers on different terms and conditions of employment. We believe that this would not be beneficial to employers as it would likely create more red tape and confusion. We cannot, therefore, support this amendment.

Amendment 127 was tabled by my noble friend Lord Hendy. We welcome any support for sectoral collective bargaining and we appreciate the informed and wide-ranging debate we had in Committee on these points. We are demonstrating our commitment to sectoral collective bargaining with the social care and school support staff sectors, as was debated on the earlier group.

We believe that bespoke primary legislation will be required to allow such bodies to operate as effectively as possible. This will allow Parliament to fully consider any such sectors and scrutinise the frameworks for the new bargaining processes. We welcome all representation regarding next steps on sectoral collective bargaining, and we are working hard to consider the groundwork required for future models. However, before this work is done, we do not seek the sweeping powers that my noble friend’s amendment aims to give the Secretary of State without a sufficiently clear purpose or plan.

I say to my noble friend Lord Hendy that we are committed to supporting sectoral collective bargaining where appropriate, and we recognise the positive contribution it can make to Britain’s economy. However, different sectors will have different needs, so we need to ensure that any legislation on collective bargaining is fit for purpose for each of the specific sectors. Developing the legislation in collaboration with the sector and workers will be key to success. I hope this offers my noble friend some comfort and that he will not go further with this amendment.

I referred to my noble friend Lady O’Grady, and I will ensure that I mention this to my noble friend Lady Anderson of Stoke-on-Trent, the Cabinet Office Minister, so that she can organise meetings for her with officials in the department. I totally agree with the point of the noble Baroness, Lady Verma, about ethnic minority business. Most businesses are good businesses. What this Bill does is go after those minority unscrupulous businesses that exploit workers. I therefore respectfully ask the noble Lord, Lord Sharpe of Epsom, to withdraw Amendment 125.

[Lord Sharpe of Epsom (Con)]

My Lords, I thank all noble Lords who spoke in this brief debate. I confess that I will have to go back and bone up on my Stanley Baldwin history—I was not expecting that. The noble Lord, Lord Hendy, accused me of ignorance of industrial relations. He asked why anyone would agree to detrimental terms, but that is missing the point, I fear. We are saying that they should be allowed to agree to different terms. Why should a worker not be allowed to trade some holiday entitlement for extra pay, for example?

We agree that we need significantly less litigation. We have been discussing that throughout the passage of the Bill. Unfortunately, as we have also discussed, so much of the Bill is likely to lead to rather more. I was very interested in the noble Lord’s comments about the workforce up until 1990, but my noble friend Lady Verma hit the nail on the head when she talked about small businesses. The fact is that the workplace has changed so dramatically in the last 35 years that I do not think that necessarily remains a valid comparison.

We have argued that free negotiation between employers and employees must be the foundation of any fair and modern employment framework. But we regret that what we see here is a model rooted in uniformity and prescription. That is flawed not just in detail but in principle, because a one-size-fits-all approach flattens the complexity and diversity of real working life and ignores the dignity and agency of the individual. Having said that, I have listened to the noble Lord, Lord Leong, carefully and, on this occasion, I beg leave to withdraw my Amendment 125.

Amendment 125 withdrawn.

Amendment 126

Moved by

[Lord Parkinson of Whitley Bay]

126: After Clause 54, insert the following new Clause—
“Chapter 4Industrial undertakingsRestriction on the employment of children in industrial undertakingsIn section 1 of the Employment of Women, Young Persons, and Children Act 1920 (restrictions on the employment of women, young persons, and children in industrial undertakings), at the end of subsection (1) insert “(but voluntary work on a heritage railway or heritage tramway is not employment in an industrial undertaking)”.”

[Lord Parkinson of Whitley Bay (Con)]

My Lords, Amendment 126 stands in my name and the names of the noble Lords, Lord Faulkner of Worcester and Lord Palmer of Childs Hill, and the noble Earl, Lord Clancarty. The amendment is identical to one which the noble Lord, Lord Faulkner, and I proposed in Committee, although noble Lords may have noticed that we have swapped round: whereas he served as the driver in Committee and I took on the role of fireman, shovelling extra fuel into the firebox, we have now swapped places, and a more diligent and experienced secondman I could not hope for. We are very glad to have support from the Liberal Democrat Benches and the Cross Benches as well, from the noble Lord, Lord Palmer, and the noble Earl, Lord Clancarty. The Minister very kindly arranged a helpful meeting with us following the debate we had in Committee, and we are very grateful to him and to his officials, as well as to colleagues from the Health and Safety Executive and the Office of Rail and Road, for the time they gave us.

Our helpful discussion highlighted the very good relationship that the heritage railway sector has with its regulators. The Heritage Railway Association, for instance, works closely with the ORR to produce guidance and examples of best practice for its members across the country. As we set out in Committee, this is a sector that takes its responsibilities to its staff, its volunteers and its visitors very seriously, and which is scrupulous in following the laws and regulations that govern it. That brings us to the problem that our amendment seeks to remedy. While there have been helpful assurances from the regulators that they would not rely on outdated legislation as the basis for a prosecution regarding the use of young volunteers, the statute book says otherwise, thanks to a law passed more than a century ago seeking to protect women and children in the decimated workforce that the country found in the aftermath of the First World War.

Let me briefly restate the problem. The Employment of Women, Young Persons, and Children Act 1920 makes it unlawful to employ young people under the age of 16 on the railways. That 1920 Act was passed more than 30 years before the first preserved railway started operation with the aid of volunteers, but by slightly confused extension through later legislation, the work the Act prohibits includes unpaid work by volunteers—far from what the original Act envisaged. This has had a chilling effect on the responsible law-abiding businesses and charitable organisations that look after this important part of our national heritage. So concerned were they that in 2015, the Heritage Railway Association sought counsel’s opinion, which confirmed that the 1920 Act remained in force and that it was unlawful to allow volunteers under 16 to undertake voluntary work on a heritage railway or tramway.

For the past decade, the noble Lord, Lord Faulkner, has been seeking to put that right. The Private Member’s Bill that he brought in during the last Parliament passed all its stages in your Lordships’ House without amendment, but was regrettably not taken up in another place, so did not become law. It did, however, win some important and helpful reassurances from the regulators, but these do not have statutory force and do not cover the threat of civil action or of prosecution by other public authorities. I stress that nobody in the sector wants to be accused of misapplying the law. If the law is unclear, it is our duty to clarify it, rather than asking voluntary organisations to spend many hours and many thousands of pounds trying to disentangle the confusion that legislators have caused.

The amendment that the noble Lords and I have brought is deliberately very narrowly framed. It seeks to make it clear that voluntary work on a heritage railway or tramway is not to be considered

“employment in an industrial undertaking”

for the purposes of the 1920 Act. It leaves that Act on the statute book. The Minister mentioned in Committee a case some 16 years ago in which the Act was used in connection with the illegal employment of a child in a factory. We can see its importance in such cases, but these are a world away from the volunteering that we want to encourage in young people in our heritage sector. The benefits of such volunteering are manifold. It helps young people to gain valuable experience and life skills, which will help them in their future employment. It brings people together across the generations and from diverse backgrounds to celebrate our shared heritage and to keep it alive for the benefit of future generations. It is an essential boost to the organisations that look after that shared heritage, which operate on very tight margins and in the face of many other challenges.

On Friday, I had the great pleasure of visiting, along with the noble Lord, Lord Hendy of Richmond Hill, the touring exhibition “Inspiration”, which is travelling the length and breadth of Britain by rail throughout this anniversary year, when we mark the bicentenary of the first passenger rail journey. Over two days at Waterloo this weekend alone, it welcomed more than 1,400 people, not just telling them the proud story of our industrial past but showing how they can get involved in the future of our railways, as coders, camera operators, ecologists, weather analysts and so much more, and how they can help to write the next exciting chapter of our railways. The exhibition in those carriages is brilliantly targeted at schoolchildren in school years 7 to 9—the time when they are choosing the subjects that will steer them towards their future careers. These are exactly the young people whose passion our heritage railways want to ignite, to help them in whatever direction life takes them.

The unintended consequence of this Act of Parliament, passed more than a century ago, stands in the way of unleashing that potential. The noble Lord, Lord Faulkner of Worcester, has campaigned long and hard for it to be remedied. I do hope that his noble friend the Minister is able to help do that today. I beg to move.

19:15

[Lord Faulkner of Worcester (Lab)]

My Lords, I am very grateful to the noble Lord, Lord Parkinson of Whitley Bay, for making an excellent speech which I could very easily have made myself—there was nothing in it with which I disagreed. He rightly referred to the fact that he and I tabled an identical amendment in Committee. We have come back tonight because this issue really has to be settled one way or another. I have previously declared my interest as president of the Heritage Railway Association. I should also say that I am the sponsor each year of an HRA award for young volunteers, to encourage a continued influx of young people to learn the skills and enjoy the satisfaction that working on a steam railway brings.

Last month, in my role as president of the HRA and co-chair of the All-Party Group on Heritage Rail, I was fortunate enough to take part in the 70th anniversary celebrations of the Ffestiniog Railway in north Wales, which was brilliantly organised and fitted in admirably with National Rail’s Railway 200 programme. It involved a cavalcade of every steam locomotive that the railway possesses, in procession on the Cob in Porthmadog, and it was a very fine tribute to the railway’s history and its contribution to the economy of north Wales. I met many young people who are keen to join the railway but are prevented from doing so because of their age, and I took the opportunity also to talk to older volunteers who are now part of the very successful team on the Ffestiniog. Almost without exception, those older volunteers started at ages as young as 13, back in the 1970s, in blissful ignorance of the Employment of Women, Young Persons, and Children Act 1920—an Act which, frankly, had disappeared from public consciousness. Indeed, many were involved in the hard physical labour of building the deviation that some of your Lordships may know, which allowed the railway to be carried above the waterline of a new reservoir to reach the northern terminus of Blaenau Ffestiniog.

As the noble Lord, Lord Parkinson, said, once the HRA received the wholly unwelcome advice that the 1920 Act had been interpreted to extend to under-16s and included volunteering as well as paid work, things changed. The safety regulators have made it clear that they would not prosecute under the 1920 Act and would maintain safety and safeguarding under more recent and appropriate legislation; but if that is so, I have to ask why this anachronistic legislation is still on the statute book.

I am most grateful to the Minister, my noble friend Lord Katz, for the discussions he initiated with the noble Lord, Lord Parkinson, and me on this, and I know how sympathetic he is to the points we have been making. I understand that the possibility of further guidance from the safety regulators remains, but that guidance must be reinforced by statutory force, because while the 1920 Act is in force, responsible Heritage Railway managers will not wish to break it. Even if the ORR would not prosecute, what is to stop a local authority or a parent doing so? It is time to make things clear and simple by removing this outdated restriction that is holding heritage railways back from encouraging the next generation, preventing them enjoying the opportunities that so many leading figures in the railway heritage movement had as youngsters.

[The Earl of Clancarty (CB)]

My Lords, I will be exceedingly brief. I put my name to this amendment in the spirit of support for our heritage, of which our heritage railways are a significant part. We need to do everything we can to allow young people who wish to do so to work as volunteers in this area. I hope that the Government will look favourably on this amendment.

[Baroness Butler-Sloss (CB)]

My Lords, I have played no part in this Bill, but I have come in especially for this amendment—although I voted on an earlier one. However, my elder brother was a passionate railway supporter, and he would have been horrified if he had realised that any support that he could give would have been illegal. Respectfully, it is no use the Minister saying that guidance shows that they will not prosecute. The fact is that the law forbids it. Speaking as a former lawyer, if the law forbids it, no respectable organisation should allow it to go forward.

It does not matter that the advice is that you will not be prosecuted. If, in the future, a 13 year-old is a passionate supporter and a different member of the organisation who looks after this says, “We must prosecute”, the fact that they have been told they would not be prosecuted would not be the slightest defence in a court of law. This is the important thing. It is anachronistic, as has been said, and it is time it was changed. I hope the Minister is not going to offer the bromide that it does not matter because it will not happen. The law has to be obeyed, and we cannot have government departments saying that you can shut your eyes to a piece of law.

[Lord Berkeley (Lab)]

My Lords, I support this amendment wholeheartedly. I have attended many meetings of the heritage rail group, and I congratulate my noble friend on the way he has taken it forward.

One thing we have not mentioned is the quite regular reports from members who run the small railways about the fear of breaking the law and the effect it could have if there are legal cases and they run out of money. Most of them are very short of money, and they rely on as much voluntary work as they possibly can. The thought of being taken to court—whether it is by the regulator, which is unlikely, as my noble friend says, or others—really puts them off welcoming younger people. It is the fear of legal action against a voluntary organisation which is the most serious part of this debate.

[Lord Palmer of Childs Hill (LD)]

My Lords, the incredible thing about this amendment is that it has signatures and support from the Conservative Benches, the Labour Benches, the Liberal Democrat Benches and the Cross Benches. It is something the Government should take into account. It is not some weird idea from one part of this House, it is across the House. I applaud the initiative which started with my old friend, the noble Lord, Lord Faulkner—if he would allow me to say that. The principle here is to try to stop unintended consequences. The law is as it is, and it cannot be ignored. We have an opportunity to tweak the employment rights legislation to put that right.

We are dealing with young people who are doing voluntary work on the railways. There was an incredible programme on television recently—which I referred to in a previous speech—where the young people were doing all the jobs on this heritage railway, except running the engine, which was dangerous and they were not allowed to do; they were the porters, the inspectors, et cetera. We all gain from it: the young people gain from it and the community gains from it. However, there is a possibility that someone could be prosecuted because the law says what it does.

We are not talking about one small heritage railway. As the noble Lord, Lord Faulkner, said, there are many; he mentioned the Ffestiniog Railway—if I pronounced that correctly. There is also the North Yorkshire Moors Railway, the Bluebell Railway, the West Somerset Railway, the Middleton Railway, the Spa Valley Railway, and many others. There is a long list.

This is a very understated thing. People have asked me why I signed the amendment from the noble Lords, Lord Faulkner and Lord Parkinson; I told them it was because we are dealing with real matters of the moment in the employment rights legislation. This is an opportunity to put right a small error in history. I invite everybody, if we go to a vote, to support this.

[Lord Hunt of Wirral (Con)]

My Lords, I rise briefly to support my noble friend Lord Parkinson of Whitley Bay’s amendment, supported as it has been by very effective speeches from the noble Lords, Lord Faulkner of Worcester, Lord Berkeley and Lord Palmer of Childs Hill, the noble Earl, Lord Clancarty, and the noble and learned Baroness, Lady Butler-Sloss.

It is a sensible measure that recognises the value of voluntary work on heritage railways and tramways, especially for young people. The current statutory framework treats such activity as though it were employment in a heavy industrial setting, when in reality it is community-based, educational and often intergenerational. These are voluntary efforts undertaken not for profit but for preservation, learning and public enjoyment. To continue to classify this as if it were unsafe or exploitive is to misunderstand both the activity and its value. This amendment corrects that without undermining the original protections of the 1920 Act. My noble friends deserve support, and I hope the Government are about to respond positively.

[Lord Katz (Lab)]

My Lords, it was going so well, then it hit the buffers. I am trying to make that not the last of the rail-related jokes—noble Lords will note the groans from behind me. I thank noble Lords for a stimulating debate—as we had in Committee—and, as several speakers have pointed out, it was a debate on a subject that inspires support from across the House, which is fairly unique in this piece of legislation. It is good to see and is obviously because so many in your Lordships’ House—like those in the rest of the country—enjoy and revel in our industrial heritage, as seen through heritage railways.

I thank the noble Lord, Lord Parkinson of Whitley Bay, for bringing the amendment back for further discussion. I think it was the noble Lord himself who outed me as a bit of a rail nerd in Committee, so noble Lords will know that heritage railways is an issue I am familiar with and fully support. It is an issue close to many hearts here in your Lordships’ house and it is great to see the interest we saw in the impassioned debate—it says here, and I agree—repeated here on Report.

In addition to the noble Lord, Lord Parkinson of Whitley Bay, I thank my noble friends Lord Faulkner of Worcester and Lord Berkeley, the noble Lord, Lord Palmer of Childs Hill, and the noble Earl, Lord Clancarty. I particularly thank the noble and learned Baroness, Lady Butler-Sloss, for making a little detour from her usual route to call by our station here tonight.

The UK heritage rail sector encompasses more than 170 operational railways, running trains over nearly 600 miles of track and operating between some 460 stations. It creates jobs and greatly supports local economies. I pay tribute to all those who run and maintain those railways; they not only preserve our heritage but contribute greatly to their local tourist economies. I mention this because it is notwithstanding the issues identified by this amendment.

The heritage railways are incredibly successful; they go from strength to strength, notwithstanding the issue the amendment raises about the Heritage Railway Association’s concerns. The benefits to all volunteers cannot be overestimated. However, as many speakers have said, it is particularly good for young people, and I wholeheartedly support efforts to encourage young people to take advantage of the volunteering opportunities that heritage railways offer, with their emphasis on teamwork, communication and helping to bring science and engineering topics to life.

It is vital that any work or volunteering is carried out safely and should be appropriate to the age and experience of the volunteer. It is also important to recognise that additional measures, such as effective supervision, need to be in place for young people, particularly those aged 14 to 16. Health and safety law requires heritage railway operators to protect a young person’s health and safety, taking account of their age, lack of experience and levels of maturity. Of course, not all work is suitable for young people; dangerous or high-risk work activities should not be carried out. Health and safety risk assessments help heritage railway operators to determine what work activity should be carried out and how to make sure it is done safely. After all, we want to preserve and revive heritage railways, not heritage employment practices. While the Health and Safety Executive and the Office of Rail and Road provide general guidance, it is for the Heritage Railway Association to support its operators with detailed guidance about suitable activities for young people.

19:30

Now over a century old, the 1920 Act is intended to protect young people from working in dangerous or high-risk industrial settings. To accept the noble Lord’s amendment, which exempts only heritage railways as an industrial setting, would not remove all the employment restrictions for young people. There are many other pieces of legislation and local authority by-laws that interact with, or depend on, the 1920 Act. The Children and Young Persons Act 1933 prohibits child employment under the age of 14 and restricts any work to “light work”. The Children and Young Persons (Scotland) Act 1937 and the Children and Young Persons Act (Northern Ireland) 1967 make similar provisions.

In addition, there are nearly 400 local authorities and councils throughout the United Kingdom and each one may make individual by-laws in relation to employment of children over the age of 13. In most cases, councils have a common approach, prohibiting a variety of roles, such as delivering milk or working in a commercial kitchen or licensed betting shop. However, there can be differences. An example can be seen in two neighbouring councils, Liverpool City Council and Sefton Borough Council, in which employment as an assistant in a fairground amusement arcade is specifically listed as prohibited in one, whereas, in the other council, it is not.

I raise this simply to point out that there is a very complex landscape at play and dealing with simply the 1920 Act will not necessarily be a cure-all. To resolve all this will need a thorough cross-government review and it will have to be fully considered in the case of any impact this amendment would unintentionally or inadvertently have on the legislative framework for the protection of children from unsuitable work. In order to ensure that there are no undesirable or unintended consequences, any power would need to be a wide Henry VIII power to allow at least the 1933 Act, and its equivalents in Scotland and Northern Ireland, to be amended, together with any by-laws that had been made by local authorities—otherwise, the other effects of the substantive provisions that remain in the 1933 Act would continue.

There is some misunderstanding that the 1920 Act makes it wholly unlawful for young people to volunteer on heritage railways or tramways. While it prevents young people undertaking higher-risk work, such as railway construction or maintenance activities, it does not preclude them from all volunteering roles within a heritage railway. To be clear, the 1920 Act does not prevent young people volunteering if they are carrying out appropriate activities.

As the noble Lord, Lord Parkinson of Whitley Bay, said, the Office of Rail and Road already works with the Heritage Railway Association to make sure that effective health and safety risk assessments are in place. They behave responsibly and it is fair to say that this amendment comes from a place of good stewardship and good intention on their part. In fact, I understand there are already many heritage railways that are excellent examples of running youth volunteer schemes very successfully. Last year, the Talyllyn railway in north Wales won the Heritage Railway Association team of the year award for its work with families and young volunteers. The volunteers are known as “Tracksiders” and work in supervised groups on projects such as painting, fencing, clearing undergrowth, building and maintaining footpaths and supporting events held on the railway.

Tracksiders are not involved in the operating of any trains or higher-risk workshop activities, and they all have regular safety briefings. Talyllyn also has a development scheme aimed at 14 to 16 year-olds, in preparation for when they can carry out more difficult tasks. The scheme includes training on preparing a steam locomotive and passenger carriages, being taught how to light up an engine, learning the route, signals and personal track safety. Another good example is the Sygnets youth volunteering group at Swanage railway. Established in 1997, this group has seen generations of young volunteers gain valuable skills and experience. In other words, the existence of the 1920 Act has not in the past—and, I hazard, will not in the future—prevent such schemes being run in the heritage railways sector.

This is not a new issue and I know my noble friend Lord Faulkner has championed this for a number of years, particularly through proposing Private Members’ Bills on a number of occasions to repeal or amend the 1920 Act. The last time, in 2022, the Bill received much support from this House and, although it did not progress further, there was a commitment from the Government to support the Heritage Railway Association in refreshing its guidance. Despite that offer being made, as far as we can tell, the Heritage Railway Association has not yet taken it up.

Although there is strong dialogue between the Heritage Railway Association and the regulators, let me be clear to your Lordships’ House that the Office of Rail and Road and the Health and Safety Executive remain willing to support the Heritage Railway Association and help heritage railway operators fully understand the risk assessment process and what activities are suitable for young people. I reiterate that I believe this is the best way to resolve the matter before trying to unravel the complex and long-standing legislation. Our position remains fully in support of volunteering on heritage railways and of growing the sector, but we are respectfully of the view that this amendment is not necessary—so I ask the noble Lord to withdraw Amendment 126.

[Lord Parkinson of Whitley Bay (Con)]

My Lords, I am very grateful to all noble Lords who spoke in this short but important debate, particularly to the noble and learned Baroness, Lady Butler-Sloss, who spoke with great clarity and authority about the legal problem that we are trying to fix. No responsible director or trustee wants to be put in the position of breaking the law, even if regulators or Ministers say that they will look the other way.

The Minister shares the passion of all noble Lords who spoke for the heritage rail sector. We saw that in our helpful meeting and in the first part of his speech today. He suggested in his closing remarks that it is for organisations such as the Heritage Railway Association to do the work: provide the guidance, take the risk and tell their members what to do. But the statutory problem remains. I stress that the Heritage Railway Association has a very good working relationship with the regulators. They have met since the letter that the Minister mentioned and they provide guidance. However, leaving this untidy situation on the statute book leaves them open to risk by civil action and prosecution by other local authorities, and in the invidious position of having to break the law, or appear to do so.

The Minister rightly mentioned other pieces of legislation which it may be important to look at, and said that we need a thorough cross-government review. This problem has been looked at for a decade by the noble Lord, Lord Faulkner, the Heritage Railway Association and others, and there have been efforts to get that thorough cross-government review—under successive Governments, I admit. So I suggest that we put the noble Lord’s very modest amendment in the Bill and seek to expedite that work. I know that, with his great interest and passion in this area, the Minister can help us reach a happy solution. However, it is important that we get started and I would like to test the opinion of the House on this matter.

19:38

Division 2

Ayes: 216

Noes: 143

19:48

Consideration on Report adjourned until not before 8.28 pm.

State of Climate and Nature

Monday 21st July 2025 Lords Chamber

Statement

The following Statement was made in the House of Commons on Monday 14 July.

“With permission, Mr Speaker, I would like to make a Statement about the climate and nature crisis.

On the day that the Met Office publishes its State of the UK Climate report for 2024, the Environment Secretary and I want to share with the British people what we know about the scale of the crisis and explain the actions that we are taking in response. We intend this to become an annual Statement to Parliament.

Let me start by setting out what we know from the science. According to the World Meteorological Organization, the past decade has seen the 10 warmest years on record globally. It says that long-term global warming, assessed by a range of methods, is estimated to be between 1.34 degrees centigrade and 1.41 degrees centigrade above pre-industrial levels, and last year was the first time we saw an individual year above 1.5 degrees centigrade.

Today’s Met Office report shows that, in line with what is happening globally, the UK’s climate is getting hotter and wetter, with more extreme events. The central England temperature series shows that recent warmth has far exceeded any temperatures observed in at least 300 years. Over the past 50 years, the number of days above 28 degrees centigrade has doubled, and the number of days above 30 degrees centigrade has trebled. This spring was the UK’s warmest on record, beating the record broken last year. Meanwhile, warming oceans and melting ice sheets have contributed to sea levels around the UK rising by 13.4 cm over the past three decades, and this is accelerating. The science is unequivocal about why this is happening. As the Met Office said this morning:

‘This … is not a natural variation in our climate … human emissions of greenhouse gasses are warming the atmosphere and changing the weather we experience’.

We know that climate change and nature loss are fundamentally linked and contribute to each other. Globally, we are losing species at a much faster rate than at any other time in human history. Here in Britain, a quarter of our mammals and nearly half of our bird species are currently at risk of extinction, with birds such as starlings, turtle doves and grey partridges under threat. The abundance of species in England has fallen by an estimated third since 1970, and Britain has become one of the most nature-depleted countries in the world.

The impacts of extreme weather and nature loss are not simply a future threat to our country; they are already here and having impacts on our way of life. We know that heavy rainfall made last year’s harvest the second worst in at least four decades, costing farmers hundreds of millions of pounds. According to the Environment Agency, more than half of our best agricultural land and over 6 million properties in England are already at risk of flooding. According to the UK Health Security Agency, there were more than 10,000 excess deaths—10,000 people losing their lives—during English heatwaves between 2020 and 2024.

As we know from recent events, rising temperatures place pressures on every aspect of our national life. We have seen this again over the past few days, with incidents of wildfires from Surrey to Scotland, disruption due to trains overheating, and hosepipe bans announced in Yorkshire, Kent and Sussex. The climate crisis is also a massive threat to our economy; the Office for Budget Responsibility’s Fiscal Risks and Sustainability report, published last week, says that the damage caused by climate impacts in a near-3 degrees centigrade world is forecast to cut our GDP by 8% by the early 2070s. Based on current GDP, that will be roughly £200 billion.

These are uncomfortable, sobering facts, and we should make no mistake: we must act on the climate and nature crisis to protect our British way of life, because no sector or part of our society is immune from those risks. Unfortunately, all the evidence suggests that this is just the start of the threat we face.

I want to acknowledge in particular the anxieties that many young people feel about these issues. My candid message to them is this: yes, there are real reasons to worry about the world they will inherit, but we can do something about it. Every fraction of a degree of warming that we prevent, and every step we take to preserve nature, helps to limit the severity of impacts and protect our country from irreparable harm. It is our generations today who have a unique opportunity to act, because unlike previous generations, we can see the evidence of the climate and nature crisis all around us, yet we still have time to limit the worst effects. The only answer is to reduce emissions, protect and restore nature and adapt to the impacts that are now inevitable. Let me take those in turn.

To those who doubt whether Britain can have any impact on the pathway of global emissions, the lesson of history is that we can. Before the Paris climate agreement was negotiated 10 years ago, the world was on course for 4 degrees centigrade of global warming. Now, national commitments imply 2.6 degrees centigrade of global warming, or below 2 degrees centigrade if countries meet their full climate targets. We remain way off track from where we need to be as a world, but we in this country have helped make a difference across parties.

In 2008, this House came together to pass the world’s first Climate Change Act. That was under a Labour Government, supported by Lord Cameron, the Conservative party and parties across the House. Now, thanks to the power of our example, nearly 60 countries have similar legislation. In 2019, under Baroness May, the UK became the first major economy to legislate for net zero by 2050, supported by the Labour party and parties across this House. Now, in part thanks to the actions at COP 26 in Glasgow, including the leadership of Lord Sharma as COP president, some 80% of global GDP is covered by net zero commitments. In 2021, England became the first country to introduce a legal duty to halt species decline by 2030, led by Boris Johnson and supported by parties across the House. Now, 196 countries are signed up to the global biodiversity framework to halt and reverse nature loss.

The lesson is clear. The choices we make as a country influence the course of global action and, in doing so, reduce the impact of the climate and nature crisis on future generations in Britain. To those who say that Britain cannot make a difference, I say, ‘You are wrong. Stop talking our country down. British leadership matters’.

We also know that climate and nature action has huge potential upsides, and not just for future generations. It has the potential for better lives today in energy security, lower bills, cleaner air, good jobs, better health and wellbeing, and improved access to nature. This Government believe in sticking to our traditions as a country of climate and nature leadership. Indeed, turning away now, at this moment of all moments, when the threat and opportunity are clearer than ever, would be the greatest dereliction of duty and betrayal of future generations.

That is why one of the Government’s five missions is to achieve clean power by 2030 and to accelerate to net zero across the economy. It is why at COP 29 we announced a 1.5 degrees centigrade-aligned target for 2035, based on legislation passed under the last Conservative Government. It is why we are driving forward on our commitment to protect 30% of our land and seas for nature and to halt species loss by the end of the decade. It is why we made the most significant investment in clean energy, climate and nature in the UK’s history at the spending review, which will drive jobs across the country.

Because the actions we need are not just about Government, we are also determined to help communities take climate and nature action in their own area, whether that is driving the expansion of local and community-owned clean energy projects through Great British Energy or supporting mayors and local government to accelerate action. At COP 30 and beyond, we are determined once again to use the power of our example to work with others to uphold the objectives of the Paris Agreement, including with ambitious climate targets, action to accelerate the clean energy revolution and the protection of nature and forests.

As I have said, action on emissions is not enough on its own. We must also protect the British people from the impacts that we already see, and sadly, the greater impacts that we are likely to see in the future. This work, led by my right honourable friend the Environment Secretary, requires action across society, from homes and buildings to critical infrastructure and our natural environment. We are now delivering Britain’s largest ever flood defence programme, investing £7.9 billion over the next decade in flood barriers and nature-based solutions such as wetland restoration. That comes alongside pioneering local nature recovery strategies, with measures such as tree planting and peat restoration, which deliver adaptation and nature recovery together. In my department, as we drive forward our plan to upgrade millions of homes, we have consulted on expanding the boiler upgrade scheme to include air-to-air heat pumps, which can offer cooling as well as heating.

However, I must be candid with the House: we know that this is just the beginning of the reckoning that we need on how our country needs to adapt across all parts of society in the years to come, and this Government are determined to put climate resilience at the heart of our decision-making.

We have been at our best in the House when we have worked across parties on these issues. I want to thank the honourable Member for South Cotswolds, Dr Savage, for introducing the Climate and Nature Bill, and my honourable friends the Members for Sheffield Hallam, Olivia Blake, and for Leeds Central and Headingley, Alex Sobel, for our discussions earlier this year in the run-up to that Bill, as well as the other co-sponsors, who highlighted the need for today’s Statement. Let me also take this opportunity to pay tribute to current and former Members across the House for their tireless advocacy on climate and nature.

The safety of our citizens, our natural world and the country that we pass on is not a Labour cause, a Conservative cause, or the cause of any other party; it is a British cause, a cause of us all, and a cause that requires all of us to consider our responsibilities to the generations of today and the generations to come. I commend this Statement to the House”.

19:49

[Lord Offord of Garvel (Con)]

My Lords, I welcome the opportunity to respond to the Statement made by the Secretary of State in the other place a week ago.

The state of climate and nature is one of the most important areas of policy that we can discuss in both Houses. However, true to form, the Secretary of State took advantage of a reasoned and evidence-led Met Office report to promote his own ideological pet project—clean power 2030—and to denounce any critic of his as anti-science, anti-jobs, anti-energy security and anti-future generation. That is a great shame.

As I have said many times in this House before, I am not a climate change denier. I have been to the Arctic and have seen first-hand the effects of global warming on the ice caps. To disagree with the Secretary of State is not climate denial, especially when we see that his unilateral acceleration to decarbonise the electricity grid by 2030 is ideologically driven and already putting the UK on a rocky road to economic ruin.

The Secretary of State referred to the need for “radical truth-telling”; perhaps it is time that he listened to his own advice. The leader of the Opposition, Kemi Badenoch, was right to say that net zero 2050, on its current trajectory, is impossible to achieve without serious cost implications for British taxpayers and industry. Even prominent Labour figures, such as Tony Blair, have argued in recent months that the Miliband plan is “riven with irrationality”. The GMB Union chief, Gary Smith, has warned about the decimation of working-class communities if we continue to shut down North Sea oil and gas.

At the heart of the Statement is a fundamental misunderstanding of the new global order. As much as the Secretary of State may wish to turn back the clock, we are no longer in 2008, when he introduced the first Climate Change Act, or in 2021, which represented peak global enthusiasm for net zero. The world has changed. In February this year, only 10 of the 196 countries party to the Paris Agreement submitted updated climate targets to the UN’s deadline. Of those, only three of the G20 countries, including the UK, submitted an updated target. Only one country reaffirmed the 2050 target with a pathway: the UK, representing 1% of global emissions.

Even the former high priests of net zero have accepted that the world has changed. Dr Fatih Birol of the International Energy Agency has now said that oil and gas will play a key role in global energy policy for decades to come. That is very different from his 2021 position of “No new hydrocarbons”. The Secretary of State talks up the need for the UK’s global leadership, yet today the UK has one of the highest energy prices in the world, which limits our growth and employment, and this is self-inflicted. Our country may have been the birthplace of the Industrial Revolution—indeed, the birthplace of AI—and today we are still leading the world in high-tech engineering, and advanced avionics and propulsion systems; but comparable major economies are not looking at the UK’s energy policy as an example of global leadership. They view us as a canary in the net-zero coal mine. The point is this: if we run ahead of the pack and fail, the pack will not follow.

Let us examine the real implications for climate and nature of the accelerated drive to clean power 2030. The Secretary of State wants to cover our green and pleasant land in solar panels and pylons. He talks of the dangers to our bird species, yet he wants to fill our skies with blades and turbines. He wants to compensate for the deficiencies of wind and solar technologies with battery energy storage, but neglects to consider the dramatic impact on our world of the mining of the critical minerals needed to support his plans. He talks of science, yet he does not accept the science of intermittency nor allow time for new technologies to emerge. The evidence is clear: solar farms will generate power 11% of the time. What shall we do for the remaining 89%? Onshore wind farms will generate power 26% of the time. What shall we do for the remaining 76%? Offshore wind farms will generate power 41% of the time. What shall we do for the remaining 59%?

The Government propose batteries as a solution to intermittency, but the battery anodes are made from petroleum coke and coal-tar pitch, and the battery cathodes are made from the mining of nickel, manganese, cobalt, iron and phosphate. Ironically, the source of the solution is the very materials that are vilified, and the mining of which is now prohibited in the UK. Has the Minister turned a blind eye to how open-pit mining disrupts habitats and landscapes, and how this extraction impacts water and pollution? I put these facts squarely to the Minister. The Government’s plans for clean power 2030 simply offshore our emissions and our jobs to other countries. Is that really what the Government meant by a “just transition”?

In conclusion, I submit that ideology at either end of the spectrum is deeply unhelpful. Whether it is clean power 2030 at one end, or “drill, baby, drill”, at the other, the harsh reality is that energy is a highly complex area which needs a pragmatic rather than an ideological solution. The Statement in the other place from the Secretary of State was an example of grandstanding without substance. This is what I hear time and again from policy professionals, academics, and leaders in the industry: there is no silver bullet; there is no one simple solution. But surely, we can coalesce around a pragmatic energy policy which is sane—first, secure; secondly, affordable; and only thereafter, net-zero emissions.

[Earl Russell (LD)]

My Lords, we on these Benches welcome this Statement, issued in response to the Met Office’s State of the UK Climate report, our most authoritative assessment of the UK’s changing weather patterns. We also very much welcome the intention to make this an annual update.

We see this Statement as a message of hope—that together we can start to reverse the impacts of climate change. Our climate has changed in my very own lifetime. The science is absolute, and our scientists are some of the best in the world. We are as certain of man-made climate change as we are that the earth is not flat. The Met Office report focuses on 2024, when the UK experienced its second-warmest February, warmest May and warmest spring since records began in 1884. The last three years have all been in the UK’s top five warmest on record. Mike Kendon, the Met Office report’s lead author, said:

“Every year that goes by is another upward step on the warming trajectory our climate is on. Observations show that our climate in the UK is now notably different to what it was just a few decades ago”.


The Met Office calculates that the UK is warming at a rate of around 0.25 degrees Celsius per decade, with the 2015-24 period 1.24 degree Celsius warmer than 1961-90. The UK is also getting wetter, with rainfall increasing significantly during the winter. Between October and March, rainfall in 2015-24 was 16% higher than 1961-90. The new normal is even more extreme.

These indisputable ground truths are an urgent and unmistakable call to action. Nature bears witness and suffers these unparalleled and accelerating changes. We are already one of most nature-deprived nations on earth. One-third of our natural species has been lost from UK biodiversity in my lifetime. Nature is struggling to adapt, just as we are. To those politicians who have given up on efforts to tackle climate change and remain happy to take funds from the fossil fuel companies, I say, you offer no solutions and no hope to our children. Like the tobacco lobby of the 1970s, who said, “One more puff of cigarette smoke in your lungs won’t hurt”, they say, “What are a few more tons of CO₂ in our atmospheric lungs?”

The UK green economy grew by 10.3% last year. A green future is our only future, and it is a good future. Global green growth is our future climate solutions, our future energy security, and our future economic prosperity.

Those who say that we cannot afford the cost of preventing climate change never calculate the devastating consequences of not doing so. Analysis from the New Economics Foundation showed that the reversal of climate policies would cost the UK economy up to £92 billion, almost 3% of our entire GDP, and mean the loss 60,000 jobs before the end of the decade. British leadership is global leadership. When we work together at home, we lead the global conversation. We are lucky: we have the knowledge, we have the technology, and we have the time to enact change. We join calls for a return to this powerful cross-party consensus on climate change. We will always seek political co-operation on these common challenges.

It feels as though Labour has found its voice and will improve its communications—and better communications are required. I ask the Government to also tackle the growing problem of misinformation and disinformation. Their own message needs to be more coherent and consistent: less talk of nature protection as a blocker, and more honesty about the complexities and challenges that we face. The nature and climate challenges are interlinked and interdependent. Nature is not only nice to have but essential to all life. Labour’s messaging on nature has been muddled, but I thank the Minister for the amendments that have been brought forward to the Planning and Infrastructure Bill. These are indeed welcome.

It is vital that we build new, clean energy infrastructure, but, equally, we must support nature recovery. This Government must champion the benefits of joined-up actions on climate and nature policies. Labour’s green mission is overly centralised: it is being done to us and not always with us. If Labour fails to work with and include our communities, public support will erode. The Government must listen to and take our communities with them. They must stop trying to do it all alone and empower and include our communities to help with the task. My party has suggested how new energy market reforms could be brought in to bring about reductions in our energy bills. These matters are urgent, so I ask the Minister: when will the Government be able to bring forward their plans to reduce our energy bills?

We must mitigate and adapt; both are needed. Not a single adaption delivery pathway plan was rated as good. The simple truth is that we have been better at changing our climate than we have been at adapting to the changes we ourselves have made. Our duty as politicians is to co-operate, create change and enable hope.

[The Parliamentary Under-Secretary of State, Department for Environment, Food and Rural Affairs (Baroness Hayman of Ullock) (Lab)]

My Lords, I thank the noble Lord and the noble Earl for their interest in the Statement.

Going on some of the comments made by the noble Lord, Lord Offord, he seems to be a bit glass half-empty at the moment. I encourage him to work with the Government to become a little more positive in his outlook. First, he asked about the cost of net zero. We believe that growth and net zero go hand and hand. Net zero is the economic opportunity of the 21st century, and it can support the creation of hundreds of thousands of good jobs across the UK and protect our economy from future price shocks from reliance on fossil fuels alone. We also believe that this is the way forward to getting the UK better energy security and to deliver a range of social and health benefits. Last week, the OBR showed clearly in its latest report on risks to the government finances that the cost of cutting emissions to net zero is significantly smaller than the economic damages of failing to act, as the noble Earl, Lord Russell, just said.

Both noble Lords asked about bills. We are determined to cut bills for people. We appreciate that they have been high in recent years and the basis of our clean energy superpower mission is to look at how we can do exactly that. If we just carry on as we are, we are exposed to expensive, insecure fossil fuels, as we saw when Russia invaded Ukraine and prices went through the roof. We are driving forward with renewable power and with nuclear, because that is the way, in the long term, that we get to cut bills. We are also looking at how we cut the cost of electricity as part of that, so that, for example, if you put in a heat pump it makes financial sense. We have to look at it all along those lines.

Renewable infrastructure and the impact on nature were also mentioned by the noble Earl, Lord Russell. We believe that nature recovery and preserving our ecosystems are an essential part of the clean energy superpower mission. As we unblock barriers to the deployment of these clean power projects, we are committed to ensuring that, wherever possible, nature recovery is incorporated in development stages and that innovative techniques can be used to encourage nature recovery—the noble Earl mentioned the amendments that we are making to the Planning and Infrastructure Bill, for example—because we want to get that balance right.

The noble Lord, Lord Offord, also talked about jobs. We are working very hard to bring in a just transition that is fair and built on the principle of fairness, because we need to ensure energy security and protect prices, as I said, but also to ensure fairness for workers, because decarbonisation has to be seen as the route to reindustrialisation. Working towards net zero and adapting to climate change are essential if we are to prevent widening inequalities and to reduce inequality as it stands. We know that if we do not act, climate change impacts more severely the most vulnerable groups, so we have to move forward on this.

The oil and gas sector was mentioned. We know that oil and gas production in the North Sea is going to continue for decades to come. We want to manage its reduction in a way that ensures the just transition and that our offshore workers can continue to work in the industries of the future. We are publishing a response to the consultation on the North Sea energy future later this year. That will look at how we can address the transition of oil and gas workers into working in clean energy. On that point, Robert Gordon University notes that over 90% of the UK’s oil and gas workforce skills have a medium to high transferability to offshore renewables.

Last time, when we had coal and steel collapse and communities were left behind, that had a terrible impact, and we are determined that that will not be the case this time, so we are working in partnership with trade unions, businesses and local communities, investing in skills and running regional skills pilots in places such as Aberdeen and Pembrokeshire.

The question was asked: why should we bother when other countries are not pulling their weight? That is not exactly true: other countries are acting. Over the last decade, there has been a transformation in the extent to which countries are taking it seriously. At least three-quarters of global GDP is now covered by a country-level net-zero target. This rises to 80% when taking account of commitments made by subnational governments. India is often mentioned. It has a target of 500 gigawatts of non-fossil fuel capacity by 2030 and of reaching net zero by 2070. China is also committed to peaking its CO₂ emissions by 2030, with a target to reach net zero by 2060. I could go on.

Consumption and emissions were talked about, as well as offshoring emissions. There has been a substantial overlap between our carbon footprint and territorial emissions. This means that our ambitious carbon budget targets and commitment to making Britain a clean energy superpower will reduce our carbon footprint in the process of reducing our territorial emissions. The latest figures do not show that we are offshoring emissions from the UK to other countries. As the CCC states in its 2025 Progress in Reducing Emissions report:

“The reduction in territorial emissions since 1990 significantly outweighs the increase in emissions from imports over that period, reflecting the fact that emissions reductions in the UK have largely occurred without offshoring emissions”.


I thank the noble Earl, Lord Russell, for his support for the Statement, but also for his clear recognition of the huge challenges that we face in tackling climate change. I completely agree with him on the complexities that he was referring to. As he said, we absolutely need that balance between nature and development.

The noble Earl, Lord Russell, also talked about the global impacts. I assure him that we are committed to working internationally and to multilateral action. We are not going to address climate change and the nature crisis on our own. The UK is steadfast in its commitment to the three Rio conventions, which aim to protect the global environment, the landmark Paris Agreement and the Kunming-Montreal global biodiversity framework. We also have international milestones coming up such as the United Nations Framework Convention on Climate Change and the Convention on Biological Diversity. We will reaffirm our commitment to working with partners around the world to scale up integrated solutions that deliver for climate and nature. That will include demonstrating how our plans at home are working to make people in the UK safer, healthier and more prosperous.

20:10

[Baroness Blackstone (Lab)]

My Lords, can the Minister confirm that contrary to the dire predictions made by the noble Lord who speaks for the Opposition, the OBR’s analysis of the costs of reaching net zero suggests that, contrary to earlier estimates, they will be much lower because of the decline in the costs of clean technologies?

[Baroness Hayman of Ullock (Lab)]

I can be very brief in my response. I can confirm that, agree with the noble Baroness and thank her for bringing it up, because the costs of not acting are huge. We must do it and work with others right around the globe to achieve it. Our clean energy mission and moving into cleaner, greener jobs for this country will be a central part of that work.

[Lord Deben (Con)]

I congratulate the Government on this report and remind the Front-Bench spokesman that every previous Conservative Prime Minister, including Mrs Thatcher, would have understood that what the Government have said is right. The cheapest way to proceed is to go green. That is where the jobs will come from. If we hang behind, saying, “After you, Claude”, we will suffer, our industry will suffer and our businesses will suffer. It would be helpful if the Opposition consulted the Climate Change Committee or those who have spent their lives working on climate change instead of making statements which do not have a scientific basis. The science says quite clearly that what the Government are doing is right. I disagree with the Government on almost everything else that they are doing. They are dreadful on most things. On this, they are right and should be congratulated.

[Baroness Hayman of Ullock (Lab)]

I thank the noble Lord for his very kind comments. He talked about science. It is worth pointing out that the Met Office published, alongside the Statement, State of the UK Climate 2024. That clearly shows that the UK’s climate is getting hotter and wetter, with more extreme weather events. We have also published several reports around protected landscapes targets, the outcomes framework and how we can unlock benefits for people. A lot of work is going on. It needs to come together if we are successfully to tackle the impacts of climate change so that we do not suffer more devastation in the future than it looks like are doing at the moment.

[Lord Sharma (Con)]

My Lords, I also welcome this Statement from the Government, particularly the commitment to deliver it annually. However, we need to see more engagement with the public. The Climate Change Committee, in its report The Seventh Carbon Budget, stated very clearly that we need to see more public information campaigns, so that people can understand the benefits of climate action and the climate actions available to them. Can the Minister update the House on what the Government’s climate engagement strategy is when it comes to the public?

[Baroness Hayman of Ullock (Lab)]

The noble Lord asks an excellent question, and I thank him for all his work in this sphere. It has been really important that we have had cross-party work on this over a number of years. Part of the reason for laying the Statement is that the Government believe that we have a duty to inform the British people about the scale of the climate and nature crises and the actions that government is taking in response. That is the start of a broader public discussion around this. If we are to move into a very different way of working in respect of energy—for example, moving away from fossil fuels and expecting people to make decisions about their heating, the cars that they drive and the costs of bills, as has been discussed—it is extremely important that we bring the public with us.

[Lord Teverson (LD)]

My Lords, I have not heard many Front-Bench Statements from the Opposition as sad, inaccurate and negative as the one that we have heard this evening. I find it incredible. I hear no solutions whatever. It is a symptom of a party that has completely lost its way and feels under threat from another party, further to the right, which voters will vote for rather than this one if this is their issue. I make that warning. It suits us as Liberal Democrats—if they want to lose another 50 seats from middle England, they can go ahead and we will accept them.

Moving to nature, I too welcome this report and that it will be annual. I want to ask about 30 by 30. It is important that we are not negative about this situation. We must be optimistic but realistic that we can meet our targets. The paper issued by Defra last October defined the types of land that can be included in 30 by 30. At the moment, only 7% of that land can be included. Could the—

[Lord Lucas (Con)]

Question.

[Lord Teverson (LD)]

I am going to ask the question. Can we find a way to define 30 by 30 land that includes ELMS, for instance, that makes that target attainable? At the moment, I believe it is impossible.

[Baroness Hayman of Ullock (Lab)]

The noble Lord asks a really important question. To meet the target, which we want to and believe that we can, we must be sure of the best way to achieve that. The land identified will be critical for that—and whether it is land or sea. A number of recent announcements will help us to work towards that—for example, the land use framework will be part of it. Banning bottom trawling in the marine protected areas will also help in the blue areas.

We are working through identifying the land that will make a difference. In the past, land that has been included—all SSSIs, for example—has not necessarily been in good enough condition to be taken into account. Taking that out has set the target back, but that is an honest approach. However, if we are being honest like that, we must be very careful about how we will achieve it and what land we are identifying. All I can say to the noble Lord is that these are really important points that we in Defra are looking at really hard to work on. We are looking at ELMS and the next batch of SFI, and what we should include in that to make the biggest difference.

[Lord Hunt of Kings Heath (Lab)]

My Lords, I refer back to the point raised by the noble Earl, Lord Russell, when he referred to growth in the green economy. This refers back to a CBI report published in February, which showed that the green economy was growing by about 10%. Does the Minister share my surprise at the antagonism of the noble Lord, Lord Offord, towards these policies, given that not only is the green economy a remarkable record of success over the last few years but that in Scotland it contributes £9.1 billion to the Scottish economy and supports 100,700 jobs? The CBI report shows that much of this huge investment in the green economy is happening not just in London and the south-east but in places such as the West Midlands and Scotland.

[Baroness Hayman of Ullock (Lab)]

My noble friend is absolutely right. It is why Great British Energy has been set up in Aberdeen, for example; it is to look at the areas that need the finance. I know that other areas, in the Midlands and the north-west, that have suffered in the past for lack of investment are now going to have huge opportunities through green finance and green infrastructure being built.

He is absolutely right. It was a little disappointing, to be honest, to hear the Opposition’s response. I remember at one time when the Conservatives were talking about being the greenest Government ever.

[Lord Inglewood (CB)]

My Lords, I am sure the Minister will agree that talking about climate change does not really do very much about mitigating the problems we all face. What we need to see happen is what my children call “stuff”. Of course, that entails regulatory frameworks and available finance. The noble Earl, Lord Russell, commented favourably—and rightly, in my view—on the recent changes proposed to the Planning and Infrastructure Bill. Can we take it from the Minister that this is a precedent that will stand when similar problems are faced in trying to bring about the mitigation of the climate problems that we are looking for, and that this is the attitude that the Government will adopt towards these problems?

[Baroness Hayman of Ullock (Lab)]

The Government are absolutely serious about tackling climate change. I really hope that that has come across both in the Statement and the answers I have given. We are also absolutely determined to ensure that nature and development can work together, that one does not have to be at the expense of the other, which is the challenge we have in the Planning and Infrastructure Bill, and why, following the discussions in the other place, we have brought forward amendments to try to acknowledge some of the concerns that have been raised also by the OEP and certain NGOs. The important thing for me is that, whatever proposals and Bills we put forward in the future, we have to look at the impact on climate change as we go forward. We have to look at the impact on biodiversity and nature, and that is what the Government are working to do.

[Lord Grayling (Con)]

My Lords, I do not doubt the Minister’s personal commitment, on biodiversity in particular, but, given that there are still serious misgivings about elements of Part 3 of the Planning and Infrastructure Bill, notwithstanding the amendments last week, given the fact that there is still a serious question mark over the future of biodiversity net gain, how can we be confident that the Government are actually going to pursue properly, and in a committed way, that 2030 target? It is there in law and is fundamentally important.

[Baroness Hayman of Ullock (Lab)]

All I can say is that we are absolutely determined to do so, and I look forward to debating it with him during Part 3 of the Bill.

[Baroness Young of Old Scone (Lab)]

My Lords, the Government’s priority is growth, but the Office for Budget Responsibility’s recent fiscal risks report said that climate change impacts could cut GDP in the UK by 8% by the early 2070s. The Government inherited a pretty naff, if I can pun, national adaptation programme, which was formerly known as NAP3. But a naff NAP3 was pretty inadequate; it had not been implemented effectively and is not joined up with other resilience work that is going across both government departments and local authorities.

I would have thought from the way the noble Lord, Lord Offord, was speaking that, since he was unconfident that we would reach climate change carbon reduction targets in time, he might have been upping the ante on the adaptation programme, since obviously we are going to have more floods, heatwaves, reductions in biodiversity and more general gloom. But I ask the Minister simply, in the face of the fact that the national adaptation programme is currently not adequate, will the Government radically get a grip on the real challenge of adapting to the impacts of climate change in this country and protect the Government’s growth strategies through that action?

[Baroness Hayman of Ullock (Lab)]

I am very pleased that my noble friend has asked about adaptation, because in my opinion it does not get talked about enough. It is going to be absolutely critical and really important that we look at how we develop infrastructure and housing. It is all going to have to take adaptation into account over the coming years.

She mentioned the third national adaptation programme, NAP3. But, alongside the delivery of that, we know that we have to drive further action. We know that we have to develop robust delivery plans ahead of the fourth national adaptation programme, which will come in 2028. We believe that we should have stronger objectives, because they are going to be crucial if we are going to have an ambitious and impactful fourth national adaptation programme. We are absolutely committed to increasing and improving the resilience of our communities as we accelerate our progress towards net zero.

My noble friend is absolutely right; it is completely critical, and vital, that adaptation is undertaken now to ensure that risks are managed efficiently and at the least cost to people.

[Baroness Bennett of Manor Castle (GP)]

My Lords, the Statement refers to the legal duty on the Government to halt species decline by 2030—except that is not happening. To take the example of birds, including the starlings, turtle doves and grey partridges the Statement refers to, overall, bird species have declined in the UK by 2% and in England by 7% in the five years since 2018. One of the significant contributory factors is factory farming. Globally, farmed chickens account for 57% of bird species by mass, wild birds only 29%. The arable land growing their feed is generally terrible for wild species, plus their waste causes widespread air and water pollution.

We have just seen that the absolutely awful Cranswick plc proposal in East Anglia for an existing site to rear 870,000 chickens and 14,000 pigs at one time was refused and 42,000 people signed a petition against it. What are the Government going to do to protect nature and human health and well-being against further expansion of the disastrous practice of factory farming, rather than forcing local councils to bear the weight of dealing with these applications and the legal risk of turning them down? I should perhaps declare that I am a vice-president of the Local Government Association.

[Baroness Hayman of Ullock (Lab)]

As I am sure the noble Baroness is aware, we do a lot of work on farming in Defra through the pathway to better welfare conditions for farmed animals. Clearly, the important thing is animal welfare, the conditions and a farm doing the best job it can in the best conditions. I do think the emissions implications for huge farms are something that we need to address and we are looking at that extremely closely. I hope she will be interested in the animal welfare strategy when we publish it later this autumn, because that will have a section on how we are going to improve farmed animal welfare, which will have a knock-on effect on exactly the kinds of situations that she is talking about.

[Lord Elliott of Ballinamallard (UUP)]

My Lords, I am surprised at some Members holding up Scotland as a bastion of good practice. I understand that Scotland has had to reduce, or at least review, some aspects of its climate targets, so I am a wee bit surprised. But my main question is on China. Imports from China to the UK were worth almost £70 billion last year, but I am not impressed to hear that China’s fossil fuel production will peak by 2030. Will we continue to buy products from China or is there a process or mechanism to force, or at least attempt to force, China to get into line? If it is allowed to peak by 2030, goodness knows where the level will be at that stage.

[Baroness Hayman of Ullock (Lab)]

The question of China is important, because if we are to tackle climate change globally and meet net zero, we have to look at those countries that have high emissions. Until very recently, China was very dependent on fossil fuels, but we also know that it is making moves away from that. It has been investing a lot in nuclear, for example. It is important to get this into perspective, because a huge country cannot change overnight. However, this country can provide global leadership in working with other countries as they move to the change they need to move to. I welcome that China is looking to invest in non-fossil fuels and move forwards and that it has set targets. That is very important, because it was not the case a few years ago. We need to have it within the global bubble if we are to continue to make progress.

[Baroness Alexander of Cleveden (Lab)]

My Lords, the debate we have had on the Statement illustrates the value of maintaining the cross-party consensus that we have had on this subject to date. I was going to ask my noble friend the question that the Opposition have asked about maintaining public engagement in this debate, so I invite her to go one step further and ensure that, in that public engagement towards a just transition, we make clear what the science says about the implications and costs of us failing to act in the way that we have heard about from the Front Bench.

[Baroness Hayman of Ullock (Lab)]

My noble friend makes an extremely good point. As I said earlier, if we are going to move forward in the most efficient and effective way, we will have to take the public with us, because they will have to make big changes and, in many circumstances, choose to make those changes—the more information people have, the more the Government can support the changes that need to be made, but it must be done in a way that demonstrates the real science behind it. Too much science around climate change is not proven, so it is really important that we have proper scientific evidence and advice when we are talking to people.

Employment Rights Bill

Report stage
Monday 21st July 2025 Lords Chamber

Report (3rd Day) (Continued)

20:31

Amendment 127 not moved.

Amendment 127A

Moved by

[Baroness Bennett of Manor Castle]

127A: After Clause 54, insert the following new Clause—
“Review of the extent and impact of pay inequality(1) The Secretary of State must conduct a review of the extent and impact of pay inequality, with particular regard to the highest level of pay in comparison with the median and lowest pay in an enterprise, in large enterprises.(2) The review must be carried out no later than 12 months after the day on which this Act is passed.(3) The Secretary of State must publish the findings of the review within three months of its completion.(4) Large enterprises are those exceeding the medium-sized companies threshold under the Companies Act 2006.”Member's explanatory statement
This new clause requires the Secretary of State to conduct and publish a review of the impact of pay inequality in large enterprises.

[Baroness Bennett of Manor Castle (GP)]

My Lords, Amendment 127A in my name is a milder attempt to deal with the pressing issue of pay inequality and soaring executive pay in our society than the amendment I tabled in Committee, which was to provide for a 10:1 maximum pay ratio for enterprises. I hope this one has a slightly less inflationary impact on the blood pressure of the noble Lord, Lord Hunt of Wirral, while dealing with the excessive boardroom remuneration referred to by the noble Lord, Lord Monks, two groups ago.

The amendment simply seeks to put in the Bill a review of the impact of pay inequality in large enterprises, as defined by the Companies Act 2006—those with net turnover of more than £54 million, assets of £27 million and more than 250 employees. I hope that the Government will seriously consider this approach. It is not my intention to put this to a vote, but I want to be helpful to the Government here and offer them some constructive ways forward.

The noble Lord, Lord Katz, in part made the argument for this amendment for me in Committee when he said that:

“It is right that companies should be sensitive to wider workforce pay when setting pay for those in the boardroom and other senior leadership positions”.—[Official Report, 24/6/25; col. 201.]


However, suggesting that companies be sensitive is not really going to do it. That seems to be the Government’s position. I noted that the Water Minister, Emma Hardy, on LBC this morning, urged water company bosses to “read the room” and refuse huge wage hikes. Well, the room has been sending a very clear message about water company bosses’ pay for a long time and the voluntary approach has simply not worked.

We are talking here about the right of lower-paid workers not to be disrespected—insulted—by the soaring pay in the boardroom while they struggle to meet their basic needs, pay their bills and put food on the table. This is action that clearly needs to be taken, not just words of gentle encouragement.

As I said in Committee, the security and catering company Mitie, with a 575:1 ratio between its top-paid employee and the median employee, and a large number of low-paid workers, tops the High Pay Centre’s FTSE 350 companies hall of shame. I note that this month, the Labour Party postponed a London drinks reception for north-west MPs sponsored by Mitie after a backlash over the company’s employment practices. Unison had planned to picket the event. You have to question why it was ever planned in the first place.

A review such as the one proposed in the amendment could be a start towards the Labour Government generating policies such as those recommended by the High Pay Centre in its useful list of proposals—I recommend it to Ministers as a crib sheet, since the current Government were elected with so few policies of their own in place—such as all-employee profit-sharing or share ownership schemes. As the centre notes:

“One of the reasons why … the pay ratios between workers and CEOs are so wide is that CEOs receive large share-based payments in addition to their regular salary while workers do not … In France all companies are required to share an element of profits exceeding a set amount calculated using factors including taxable profits, net equity, wages and added value with their workforce”.


This has actually reduced inequality.

Another timely proposal from the centre, which again a review might throw up, is a cap on CEO-to-worker pay gaps for public service providers, such as water companies—here we have another way forward—or social care providers. The claim made by the noble Lord, Lord Katz, in Committee, that high pay means

“companies can compete for the best business talent in the UK and globally”,—[Official Report, 24/6/25; col. 202.]

certainly does not stack up in the water sector, if one looks at its outcomes. Fat cat pay has delivered only underinvestment, pollution and ill health for those unfortunate enough to have to rely on the services of the privatised companies.

Finally, I note that, responding to the call for even higher executive pay from the UK capital markets task force—drawn from the City of London and big business—a letter written by 20 leading academics specialising in executive pay, corporate governance and economic inequality made a number of points, including that there is a very “questionable” link between

“higher executive pay and better business performance”,

that any claim that there is a

“shortage of capable candidates for executive roles should … prompt scrutiny of companies’ leadership training and development processes”,

and that the “opportunity costs” of high top pay have impacts

“in terms of … pay for low and middle income workers or investment in the business”.

It is interesting that polling by the High Pay Centre suggests that the overwhelming majority of the public think that CEOs should not be paid more than 20 times more than their typical employee. If the Government want to consider the politics of this, I point to the conclusions in the report, The Spirit Level at 15, by Professors Kate Pickett and Richard Wilkinson, which articulates many of the ways in which inequality strengthens far-right politics. Executive pay is only part of that story, but it is a very visible part. This amendment offers the Government a way forward to start to tackle that political problem, as well as the economic and social issues. I beg to move.

[Lord in Waiting/Government Whip (Lord Leong) (Lab)]

My Lords, I thank the noble Baroness, Lady Bennett of Manor Castle, for tabling Amendment 127A. Although it rightly raises the important issue of pay inequality, it effectively duplicates a review process that we are already undertaking.

It is undeniable that average salaries have stagnated. In fact, they have barely increased from where they were 15 years ago. Had wages continued to grow at the rate seen prior to the 2008 financial crisis, the average worker would now be over 40% better off. This is not just about stagnant wages; it is about persistent and deep-rooted inequalities.

The UK’s income inequality remains above both the OECD and G7 averages. In the financial year 2022-23, the richest 20% of the population received 44% of the UK’s gross income, while the poorest 20% received just 7%. The OECD has noted that higher inequality can lead to underinvestment in human capital and slower adoption of new technologies. It estimates that rising inequality between 1990 and 2010 resulted in UK output being nearly nine percentage points lower than it might otherwise have been.

As I said on day 2 on Report, in one of the world’s wealthiest nations, workers are still turning to food banks. Many cannot afford rent, let alone a mortgage. Morale is at rock bottom and motivation is vanishing. The noble Baroness is right: executive pay keeps climbing. In 2023 the average FTSE 100 CEO earned 118 times more than the median UK worker, up from 50 times in the late 1990s. This is not sustainable or fair.

The UK exhibits greater regional disparities in productivity, pay, educational attainment and health than many other developed nations. This Bill, by benefiting lower-paid employees most, will help reduce these disparities, not only in terms of income but in the quality of work experienced. Supporting this, analysis published in 2019 by the World Bank found that employment protections can play a significant role in reducing income inequality.

As I have previously outlined, we already have robust monitoring and evaluation mechanisms in place. By reinforcing the framework that supports our workforce, we are making work more secure and predictable. We are also putting more money into the pockets of working people by making wages fairer. I therefore respectfully ask the noble Baroness, Lady Bennett of Manor Castle, to withdraw Amendment 127A.

[Baroness Bennett of Manor Castle (GP)]

My Lords, I thank the Minister for his answer, although I have to express disappointment that none of the other Front Benches wanted to engage with the issue of high pay. The Minister very much acknowledged the issues around low pay and talked about robust monitoring and evaluation of high pay, but he did not speak about any action on it nor even about any plans for action on it. We have a real problem with the inequality that has seen those executives’ salaries—those fat cat salaries—rise and rise. As I said in my introductory remarks, there is an opportunity cost where those resources are going to that, as well as, of course, the sense in society that there is a deep unfairness and the Government are not doing anything about it.

I remain disappointed. This is certainly an issue that I and the Green Party will continue to work on but, in the meantime, I beg leave to withdraw the amendment.

Amendment 127A withdrawn.

Clause 55: Right to statement of trade union rights

Amendment 128

Moved by

[Lord Hunt of Wirral]

128: Clause 55, page 75, line 23, at end insert—
“(8) The provisions inserted by this section do not apply to small businesses.(9) For the purposes of subsection (8), a “small business” means an undertaking which employs fewer than 50 employees.”

[Lord Hunt of Wirral (Con)]

My Lords, in moving this amendment, I will also speak to Amendments 129, 131 to 134 and 145 in my name and that of my noble friend Lord Sharpe of Epsom. What we are talking about here is the extent to which the Government’s sweeping changes to trade union access rights, including the unprecedented extension of digital access, should apply to small businesses. These changes were introduced without any proper explanation on Report and they have generated serious concern, particularly for our small and medium-sized enterprises, which may suddenly find themselves subject to obligations they neither anticipated nor are equipped to manage.

These amendments have been directly endorsed by the Federation of Small Businesses, the principal organisation representing the voice of small employers right across the country. I quote from it directly:

“New growth and jobs in local communities rests squarely on our SMEs, which make up over 99 per cent of all UK businesses and employ around 16 million people—disproportionately recruiting those furthest from work.


The Federation of Small Businesses (FSB) supports this amendment, which recognises the distinct nature and limited resources that small employers face when it comes to managing industrial relations in what in many cases are more like family units or teams, than big corporates.


They simply do not have the HR infrastructure or legal teams that big firms rely on to navigate complex union access procedures and negotiations. This amendment provides a necessary and vital safeguard by ensuring that SMEs are not automatically subject to trade union access requests or changes to recognition thresholds.


Our recent research found that 92% of small business employers are deeply concerned about the measures proposed in the Employment Rights Bill, with 72% specifically worried about the increased cost of compliance, such as the need for specialist HR or legal support. These figures further demonstrate the importance of maintaining proportionate, practical and measured safeguards, such as those contained within this amendment.


We hope that Conservatives and Liberal Democrats will back the amendment to delay these measures, and that the Labour Government will agree to it, to guarantee proper consultation, and assessment of the practical impacts on SMEs, and that Parliament considers these before Ministers turn on these provisions”.


I beg to move.

20:45

[Lord Londesborough (CB)]

My Lords, I support all the amendments in this group but will speak specifically to Amendments 129, 131 and 145 tabled by the noble Lords, Lord Sharpe of Epsom and Lord Hunt of Wirral, to which I have put my name.

Increasing the right of trade union access, as well as lowering the membership thresholds and the required percentages for action, is, as we know, applying right across the board, whatever the size of the business or organisation. It is Part 4 of the Bill, as the noble Lord, Lord Hunt, just highlighted, that is causing considerable alarm and nervousness among SMEs, particularly small, micro and family business owners. I know this through multiple meetings with business owners and the steady flow of emails into my inbox.

At this point I remind the House of my interests as a chair of, adviser to and investor in a range of small start-ups and scale-ups. One of the key issues that keeps being raised by entrepreneurs and business owners is workforce culture, performance and collaboration within teams, which are so vital to achieving productive, profitable and ultimately sustainable businesses.

These employers are not simply against any sort of unionisation of their workforce. In many cases they can see the merits, but they are very concerned about the enhanced provisions of access in the Bill and the potential impact on owner/employee relations, teamwork and, indeed, the increased time that will need to be devoted to changing induction paperwork, negotiating with staff and their unions, facilitating meetings and possibly having to work with the Central Arbitration Committee and the fair work agency, which will have the right of entry to their businesses and, indeed, to their records.

In an era when we as a nation desperately need to see real economic growth, especially per capita growth and productivity advances, this part of the Bill threatens to dampen those prospects and distract owners and management from this core mission. Among small businesses, there is also the danger of creating divisions unnecessarily between owner and workforce and, indeed, between members of the workforce itself. I know this is not the Government’s intention, but we run the risk of damaging these unique cultures that we see in start-ups and family businesses.

In short, whatever the Government’s rather confusing claims on consultation, the SME community—which, as we have heard, accounts for nearly 17 million jobs and £2.8 trillion turnover per annum—clearly does not feel that it is being heard, let alone consulted. Amendments 129 and 131, in particular, seek to address this, in what I believe is a considered and structured way.

First, we need to see structured and representative consultations across micro, small and medium-sized businesses, across the key sectors, and involving start-ups, scale-ups and family businesses, from those employing two to three staff to those employing 20, 50 or 150 staff. These are very different enterprises, not just in size but in stages of development.

Secondly, we need to see coherent impact assessments for each of these groups, not the one-size-fits-all approach that dominates so much of this Bill, and not just by size but by sector. From agriculture to technology and telecoms, they will be impacted in very different ways. As we have heard, SMEs will need time and fair notice—certainly not before April 2028—to be ready to deal with the potential consequences of these clauses.

None of this is unreasonable in my view. These amendments would help the Government to avoid damaging the SME ecosphere at a time when we need to proceed with care and caution, and especially if we want SMEs to be the engine of real economic growth.

[Lord Moynihan of Chelsea (Con)]

My Lords, I will speak to Amendment 130 in my name. It is purely an amendment to rectify a small perceived mistake in the legislation, whereby a trade union can, in theory, put in a demand to meet its members in a company immediately, without any delay or warning. This means that a company’s management must always be in fear of a sudden disruption to the company’s ongoing work.

I am sure that the Government did not intend to torment companies with this possibility. I have put forward this amendment with a view to giving the Government an opportunity to agree that some kind of advance notice—I am suggesting a delay between request and meeting of at least two days—is a good idea, and that the length of that advance notice should be put in the Bill.

We all agree that business is the engine of economic growth and the ultimate creator of jobs. Therefore, we all in this House must be agreed that helping business accomplish its ends is important. The Government want the economy and jobs to grow—they have told us so repeatedly. They do not want companies worrying unnecessarily about sudden disruptive swoops from the union. We can see at once that there are many circumstances where a request to meet immediately just would not work. Imagine, for example, the air traffic controllers having to suddenly down tools. Imagine a complex, just-in-time process of many interlocking parts suddenly being interrupted, with an appalling domino cascade of interruptions and failures as a result. Imagine a complicated safety audit being disrupted.

I am sure that the Government have no intention of this and I imagine that the Minister will tell us that it is not at all the intention. However, while it might not be the intention, the opportunity is there in the Bill for the trade unions to act in this way. Therefore, why not, in the Bill, prevent that opportunity?

We all agree that untrammelled regulation is a “boot on the neck” of business—we were assured that that was the case just last week by the Chancellor of the Exchequer herself—yet here in Clause 50 we have yet another regulator, not the first one that we have discussed that has been created for the Bill, with fining powers. Last week, in the same Bill, it was the FWA; now, we have the Orwellian-sounding central arbitration committee, again with fining powers.

[Noble Lords]

Oh!

[Lord Moynihan of Chelsea (Con)]

Noble Lords should read the Bill. Payments will be made if the Central Arbitration Committee decides that a request to meet was unfairly refused. I checked it all this afternoon. I did not really expect noble Lords to challenge me on it.

[Lord Davies of Brixton (Lab)]

I think the reaction from noble Lords was to the use of the word “Orwellian”. No one is questioning the facts; it is the suggestion that a central arbitration commission is Orwellian.

[Lord Moynihan of Chelsea (Con)]

My Lords, a central arbitration commission might not be Orwellian but I feel that a Central Arbitration “Committee” is. We can agree to disagree on that, but the word “committee” is in the actual name.

Imagine how all this will be taken by the neck on which this regulatory boot is going to be placed by the Bill. All my amendment does is suggest some small limit to when a trade union might announce the date on which it wishes to meet its members. That would provide a proper, proportionate and fair way of giving both sides, company and union, what they need. Indeed, the delay would actually help the union, by allowing it to find a time when more staff were present for the mooted meeting.

The Bill gives the union three months in which to complain if management refuse the proposed time to meet. Surely if three months can be given to the union, two days is not too much to ask for the employer to consider any such request.

[Baroness Lawlor (Con)]

My Lords, I support my noble friend’s amendments. There are good reasons to exempt small businesses, which make up the backbone of our productive economy, from the measures in Clauses 55 and 56, both for the statement of trade union rights and for trade union access.

We know, as we discussed in Committee, how rapidly trade union membership is falling, and that it has fallen particularly in the private sector. We know that, although it has gone up in the public sector, it still represents a much smaller proportion of trade union members than in 1995, when statistics began. Small and medium-sized businesses account for 99.8% of our productive economy. If we impose additional compliance costs on 1.16 million micro businesses of up to 10 employees and on 4 million sole traders, we are saddling them with the kind of compliance costs to which noble Lords have already referred.

I wholeheartedly support my noble friend’s amendments to exempt the majority of small, tiny and medium-sized enterprises from the compliance costs of furnishing a letter and the costs—indirect, perhaps—of access arrangements for trade unions, when there may be no trade unionists in the workforce of these small, entrepreneurial businesses.

[Lord Leigh of Hurley (Con)]

My Lords, I rise briefly to mark that this is the moment—21 July, at 8.59 pm—when the Labour Government are going to put such unreasonable demands on small businesses that they will all come together and say, “This Government are not our friend. This Government are distracting us from growth, from employing more people and from productivity”. Just as small businesses are getting over Making Tax Digital, Covid and tariffs, this legislation will do irreparable harm. I wanted to make that point because I assure noble Lords that there will be future reference to this very moment.

[Baroness O'Grady of Upper Holloway (Lab)]

My Lords, I too will be brief. I thought it might be helpful to inject a bit of balance into the debate. Noble Lords might recall that in Committee I spoke of how often there are positive voluntary agreements between employers and unions about access, because everybody recognises that in a modern, civilised society, workers should have the right to speak to a trade union. It is their choice whether to join, but it ought to be seen as a basic right to be able to meet a union at the workplace. In my experience, very often you go in and have a cup of tea and you get a chance to meet the workers, who will make up their own minds about whether they want to join.

21:00

I remind noble Lords that I also spoke about some pretty appalling situations, where we know that workers are being exploited badly. We have been forced to stand on roundabouts in the rain, out of the view of CCTV cameras, because workers are terrified of being seen talking to a union. I hope most noble Lords would agree that that is just not right in a civilised society and that workers should not experience that fear. They should have the right to meet a union at their own workplace.

It is important to see this as a right for workers. It is very much built on the premise of agreement between an employer and a union about what is reasonable. It is not about turning up out of the blue and busting your way into a workplace; it is about coming to an agreement. I am sure that those noble Lords who talk so often about their business responsibilities will understand the importance of agreement when it comes to industrial relations.

Finally, there are 6 million workers working for small and medium-sized enterprises; I think it is around a third of the private sector workforce. The idea that they would be denied that right just because they happen to be employed by a small employer seems wrong to me. I remind noble Lords one final time that this is about the rights of workers to speak to unions in their workplaces and doing so with agreement. The CAC becomes involved only if you cannot come to an agreement between the union and the employer. I am afraid I very much oppose these amendments and support the Bill as it stands.

[Lord Hannan of Kingsclere (Con)]

My Lords, last week the chairman of the junior doctors—or, now, resident doctors—committee of the BMA put out a tweet saying, “You do not have to tell your employer if you are striking”. I thought of that as I listened to the noble Baroness, Lady O’Grady, talking about how reasonable, collaborative and useful this union participation was. There is a difference between people wanting to work together and people seeking to inflict maximum disruption, as is plainly the case in the doctors’ strike. I have to say, by the way, that the Secretary of State for Health in another place has made the same point that I have: he thinks it is extremely disruptive and has said all the right things about it. But can we really blame the BMA or any other union for walking through a door that is being so ostentatiously unbolted with the passage of this legislation?

I do not want to get into a Second Reading speech, but I agree with my noble friend Lord Leigh of Hurley: we have done extremely well with low unemployment, unlike almost every other country in Europe. With the financial crisis and Covid, we have had structurally low unemployment because of a flexible labour market. That is beyond this amendment, but I do not see how anyone could reasonably oppose the amendment just put forward by my noble friend Lord Moynihan of Chelsea. If we are in a world of wanting to be collaborative, it seems to me that informing an employer before coming and organising in that company is a matter of minimal courtesy. It seems to be an oversight in the legislation, and I hope that Ministers will at least be able to concede that point.

[Lord Goddard of Stockport (LD)]

My Lords, I have to say that this is probably the most difficult summing up from our group of all the amendments throughout Committee and Report, because I can see the merits of both sides of this argument.

On the one hand, the noble Lord, Lord Hunt, is quite right. We are naturally suspicious of any new amendments on Report, as they have not had consultation or examination. Having said that, as a group, we have to be consistent, and our approach is that SMEs need the most support. They are the people who are the most insecure and who email me more than anyone else, and so you might think that I would be minded to support these amendments.

However, on the other hand, these amendments, in our view, would create the two-tier employment situation which we have consistently opposed throughout the legislation. I have stood here night after night saying that I cannot agree with amendments because we want one set of legislation for the entire SME sector. A two-tier arrangement would throw more upheaval and uncertainty on small SME businesses, leading them to wonder whether or not they qualify and whether they are in or out.

On balance, and probably for the first and only time in this Chamber, if this issue is pushed to a vote, our group will, unusually, abstain. That does not mean that I am not supportive of the thought behind the amendments, but we feel very strongly that there could be unintended consequences. The legislation should be clear, concise and uniform. This would cloud it a little, as it is looking for a two-tier arrangement. On balance, we are unable to give this group of amendments our full support tonight.

[Lord Leong (Lab)]

My Lords, I am grateful to all noble Lords who have spoken. I may not agree with some of the sentiments of some noble Lords, but I have listened to all the arguments in the last few years, such as when minimum wage was debated. The scaremongering that businesses will go bust does not hold water with me.

We are not anti-business; you cannot find someone more pro-business than me. I have started businesses and been a small business person myself. I strongly believe that this Bill works for workers and for business.

Before I address the amendments in the names of the noble Lord, Lord Sharpe and Lord Moynihan of Chelsea, let me say this: the Government are committed to supporting SMEs. We accept that they have been subject to a challenging operating environment and global uncertainty. That is why the Government have set up the new business growth service, to streamline access to support, and why the new strategy will span key areas, including access to finance, market expansion, business capability development, entrepreneurship, and the creation of a strong and stable business environment. In combination with our industrial strategy, trade strategy and, I hope, our SME strategy, which will be published shortly, it is a key part of this Government’s plan for change to encourage growth and put more money in people’s pockets.

Let me turn first to Amendments 132, 133, and 134. We introduced a streamlined route through the Central Arbitration Committee, which was established in 1975. It is a decision-making process for model access proposals to ensure that genuine and reasonable requests for access are not subject to unnecessary delay, while maintaining appropriate safeguards where complexity or dispute remains.

Regarding Amendments 129, 131 and 145, we believe that strong trade unions are central to tackling issues of insecurity, inequality, discrimination, enforcement and low pay across the economy. Right of access is key to this. The access framework allows for flexibility for SMEs. Unions and employers can negotiate an access agreement and employers may challenge proposals they consider unsuitable. Where an access agreement cannot be agreed, the CAC determines whether access should be granted, and this decision will be guided by matters prescribed by the Secretary of State.

On Amendment 128, the intention behind this measure is to ensure that all workers are informed of their legal rights at work without imposing undue burden on employers. Making it a requirement for employers to inform workers of their right to join a trade union is about fundamental fairness and transparency. Too many people, especially in low-paid or insecure jobs, do not know that they have this right. We are not telling anyone to join a union; we are simply making sure that they know it is an option. Just as employers are expected to inform staff about health and safety rules or their right to paid leave, they should also be clear about the right to union representation.

[Baroness Lawlor (Con)]

Will the Minister agree that it is a bit heavy-handed to require an employer to furnish a new employee, at the same time as giving them the agreed terms and conditions of employment letter, with a statement on their right to join a trade union? I cannot see that that is proportionate.

[Lord Leong (Lab)]

It is just like any other right that employees expect, such as health and safety, annual leave and all that. The right to join a union does not mean that they have to join a union; it is still their choice. It is a small step that empowers workers and supports a fairer and more balanced workplace.

The statement of trade union rights will be provided at the start of employment, alongside an existing written statement of particulars already required under Section 1 of the Employment Rights Act 1996 and at other prescribed times. Given that it builds on an established process, we believe that this measure places minimal burden on employers, including many small businesses. We will consult on the practical details of Clause 55 before this is set out in secondary legislation.

On Amendment 130, the right to access is a complex policy and will involve detailed practical consideration. We will therefore provide for the operational details of a responsible and regulated access framework in secondary legislation. Ahead of doing so, we will publicly consult on the operational details this autumn, including on model access terms that the CAC must consider reasonable for both employers and unions to comply with, and the appropriate amount of notice a union must give before access takes place. Consulting before setting out these operational details will ensure that we cater for a variety of scenarios and workplaces and will ensure that these measures are fair and workable in practice. We believe that providing for this operational detail now, ahead of consultation, would be premature. I therefore respectfully ask the noble Lord, Lord Hunt, to withdraw Amendment 128.

[Lord Hunt of Wirral (Con)]

My Lords, I say with great regret that the response we have received today is totally unconvincing. At no point throughout the progress of the Bill have Ministers offered a satisfactory explanation as to why sweeping changes to trade union access rights, including digital access, were introduced on Report in the other place, with no consultation, no impact assessment and no regard for the realities facing small and medium-sized businesses. There has been no clarity whatever regarding how these measures will work in practice.

How right the noble Lord, Lord Londesborough, is to stress that there has been no recognition of the burden they will place on the thousands of small and medium-sized employers across the country. There has been no proper answer to my noble friend Lord Moynihan of Chelsea, who was supported by my noble friends Lady Lawlor and Lord Leigh of Hurley. I have no need to reply to the noble Baroness, Lady O’Grady of Upper Holloway, as she was shot out of the water by my noble friend Lord Hannan of Kingsclere. All I will say is that there has equally been no proper consideration of the broader impact these changes could have on the labour market, particularly on hiring, retention and business confidence, at a time of economic uncertainty.

I regard the noble Lord, Lord Goddard of Stockport, as consistent, but I disagree with him fundamentally. I hope he will issue a detailed explanation to the Federation of Small Businesses as to why he has felt unable to follow its guidance that there has to be a recognition of the special needs of small and medium-sized enterprises. I can well understand that the arguments that the noble Lord, Lord Londesborough, introduced in support of Amendment 129, together with Amendments 131 and 145, provide a simple and proportionate safeguard. Given the seriousness of these issues and the complete lack of justification for how this has been handled, I shall seek to test the opinion of the House on Amendment 129, but, in the meantime, I beg leave to withdraw Amendment 128.

Amendment 128 withdrawn.

Clause 56: Right of trade unions to access workplaces

Amendment 129

Moved by

[Lord Hunt of Wirral]

129: Clause 56, page 76, line 35, at end insert—
“(c) may not be made if the employer in question is a small or medium-sized enterprise.”Member's explanatory statement
This amendment and others in the name of Lord Sharpe of Epsom provide that a trade union cannot give an access request if the employer is a small or medium-sized business, unless the Secretary of State has provided for this in regulations. Such regulations (where they affect small or medium-sized businesses) may not be made before 6 April 2028, and without prior consultation and publication of an impact assessment. They also provide that the Secretary of State must consult and publish an impact assessment prior to making regulations to vary the required percentage.

21:15

Division 3

Ayes: 106

Noes: 140

21:25

Amendments 130 to 134 not moved.

Schedule 6: Trade union recognition

Amendment 135

Moved by

[Lord Sharpe of Epsom]

135: Schedule 6, page 227, line 12, leave out sub-paragraphs (3) and (4)
Member’s explanatory statement
This amendment and others in the name of Lord Sharpe maintain the existing 10% membership threshold for union recognition applications by removing provisions that would have allowed this threshold to be modified through secondary legislation.

[Lord Sharpe of Epsom (Con)]

My Lords, I rise to speak to Amendments 135 to 143, all in my name and that of my noble friend Lord Hunt of Wirral. When this power first appeared in the Bill, the Minister in the other place, Mr Justin Madders, admitted that the Government had not even decided whether they were intending to use it. First, they said there would be no consultation, then they changed their minds. That is not a serious way to make laws; it is confused and confusing, especially for, as ever, SMEs, which are, as we have discussed many times during the passage of the Bill, in a state of uncertainty about the basic rules governing their own workplace.

If the membership threshold was reduced to 2%, as the Government appear to envisage, in a company that employs 250 employees, it would require only five members in the bargaining unit to request a ballot. That would mean that a union could gain bargaining authority over workplace conditions, pay and leave arrangements for the entire bargaining unit based on the explicit support of a tiny number of employees. This raises questions about whether such an arrangement adequately reflects workforce preferences, particularly for employees who may value direct engagement. That potentially creates a situation in which unions may submit many speculative requests for recognition, with little depth of membership in a proposed bargaining unit. The process comes at a cost to the employer of both managing and arranging access and facilities, and to the Central Arbitration Committee for supervising these potentially speculative ballots.

I really think this speaks for itself; there is not a huge amount to say in addition, although I would note that the noble Lord, Lord Hendy, talked earlier about workplace democracy. Whatever it is, it is not this, so I beg to move.

[Lord Lucas (Con)]

My Lords, I have Amendment 144 in this group. We discussed the same amendment in Committee. If we do not have a number, it means that, essentially, one employee could trigger union recognition. Surely that is not something we should impose on small businesses.

[Baroness Lawlor (Con)]

My Lords, this set of amendments is a proportionate response to the Bill’s Schedule 6 to ensure that we have clarity in the Bill for all parties about the threshold to be met in respect of a union seeking recognition to conduct collective bargaining on behalf of a group of workers making a request for recognition. As matters stand, employers, unions and employees know that the threshold for recognition is 10%. This is established under Schedule A1 of the Trade Union and Labour Relations (Consolidation) Act 1992, on trade union recognition for the union or unions seeking recognition to be entitled to conduct the collective bargaining on behalf of a group of workers.

The 10% threshold is set out in paragraph 36 and reinforced throughout Schedule A1 in the subsequent paragraphs that my noble friend’s amendments seek to reinstate. That includes paragraphs 45 and 51 on competing applications, paragraphs 86 to 88, and paragraph 14 on applications. As your Lordships know, this Bill substitutes the words “the required percentage”, including for paragraph 45 on the validity of applications. We know that the required percentage may be 2%, but it has become almost a euphemism for whatever a Minister may decide post consultation and impose via statutory instrument in whatever circumstances we may imagine. It may be that the union masterminding the Birmingham bin chaos, which finds its members fleeing to another union, wants the Government to get a 1% or 0.5% figure in the instrument—or else it would withhold its support from the Labour Party.

21:30

I strongly support this set of amendments because they make it clear to all the parties concerned what the threshold will be. They will encourage trade unions to meet that threshold in the workplace and not to put their recognition bids through the backdoor of a statutory instrument. They should play fair with the workers, the employers and the country about the 10% threshold.

[Lord Fuller (Con)]

My Lords, I will speak to all the amendments in this group. I approach it from the perspective that democracy is always about cherishing minority views and making reasonable allowances, with the proviso that the minority do not hold the majority over the barrel. If you allow the minority a veto or special qualification to enforce their narrow view of the world, it encourages extreme views and intransigence. If you give somebody a veto, do not be surprised if they use it. The effect of the Bill is perhaps to give minorities significantly lower than the 10% threshold a perverse incentive to exercise that veto. That is not good for the individual or the employer, and I believe that it is not even good for the unions, because it potentially weakens their members’ mandate.

I speak from the perspective of somebody who has negotiated the local government pay deal for many years as part of the national joint committee, alongside the noble Baroness, Lady Taylor. My experience is coloured by the knowledge that in local government there are three different unions involved—UNISON, Unite and GMB—and it is a complicated negotiating environment. It is hard enough to get consensus with three unions in the mix, still less with 10—but that is where the Bill is taking us.

If we do not accept these amendments, it will place the employers in the invidious position of choosing between various unions. The lower the threshold, the greater the incentive to fragment the union landscape—the Judean People’s Front phenomenon—and, in so doing, weaken the benefits of sensible recognition and union power. I cannot understand why the brothers are so keen to reduce the 10% threshold. Why should the employer be placed in an impossible position to arbitrate between warring unions, jostling for position and preference by allowing each to assert rights that they should be agreeing among themselves?

These amendments will not weaken the thrust of what the Government are trying to achieve, but they would provide the certainty of a materiality threshold that would otherwise allow the unintended consequences of negotiation chaos—too many cooks being allowed to spoil the broth. That would disadvantage the employee by reducing the negotiating power of the majority; disadvantage the employer by making it hard to negotiate with unions with sufficient critical mass; and, for the union movement, value fragmentation and the pursuance of special interests over building consensus.

Once more, we have an opportunity to ask the Government to support sensible and measured amendments that will help them achieve their purpose. To resist would risk delivering the opposite, and not for the first time.

[Lord Goddard of Stockport (LD)]

My Lords, in Committee we tabled several amendments resisting this reduction from 10%, and the reason for doing that was that we think that is the existing and fair threshold. To go to 2% is not being done for the reason that the noble Lord, Lord Fuller, says, which is about competing unions and getting the one with the lowest threshold, but for a different reason.

When we have had these arguments, in Committee and tonight, the fall-back position of the Ministers and other speakers is, “Well, they don’t have to join a union—they don’t have to be in a union”. I was in the GMB—I do wish people would not list Unite and the other one, and put the GMB third; please put the GMB a bit further up the pecking order next time. But the point of the story that I am trying to tell noble Lords is that although the Minister says that you do not have to join a union, by reducing this to 2% from 10% you are effectively stacking the deck. You are setting them up there. If you believe that trade unions are free to join or not, and there is a threshold and it is 10%, that is your principle, and that has stood for years. Why, then, in employment law do you need to move that down to 2%? What brings you to that number? There is an obvious reason for that number, is there not?

On the unintended consequences again—it becomes a mantra, but I will say it very quickly—in small and medium-sized businesses employing 10, 15 or 20 people, they need only two, three or four people to say, “We want to join a union” for it to become complicated, with HR and all the other unintended consequences. So 10% is a reasonable threshold. The Government have given us no reason why they want to change it from 10% to 2%. They should leave it at 10%; leave the status quo. If the noble Lord, Lord Sharpe, decides to press his amendment tonight, my depleted troops will be supporting him in the Lobby.

[Lord in Waiting/Government Whip (Lord Katz) (Lab)]

I thank all noble Lords for the short but focused debate we have had on this set of amendments, moved and spoken to by the noble Lord, Lord Sharpe of Epsom. I particularly pay tribute to my fellow GMB member, the noble Lord, Lord Goddard of Stockport.

As I set out in Committee, we believe that current thresholds pose too high a hurdle in modern workplaces, which are, as we know, increasingly fragmented. We want therefore to be able to consider whether the 10% membership threshold on application should be reduced in future. The reason why a range of 2% to 10% has been chosen is that, in 2020, the previous Government reduced the threshold that triggers information and consultation arrangements from 10% to 2% in the workplace, so what the Bill proposes aligns with that. But, to be absolutely clear, we want to consult before making any decisions on whether we should bring forward secondary legislation and by how much the threshold should be varied, if at all. We will consult businesses—including, of course, small and medium-sized businesses—as part of that consultation process.

Should we decide to bring forward secondary legislation in the future, that legislation will be subject to full debate in both your Lordships’ House and the other place. We will carry out an impact assessment at that time that will consider impacts on businesses, including, as before, small and medium-sized businesses.

I want to reassure all noble Lords, and the noble Lord, Lord Sharpe, in particular, that, whatever the application percentage in the bargaining unit is or may be, the fact remains that unions would still need to obtain a majority of a bargaining unit in a trade union recognition ballot. That point is fundamental to the misconception that is coming from the Benches opposite about what this part of the Bill does or does not do. To be clear, this is not, to address the point of the noble Lord, Lord Fuller, the “tyranny of the minority”; in fact, it is absolutely contrary to that point. This is ultimately about a trade union having to win a majority.

Experience has shown that this is not easy to achieve. The union will have to make a good case to persuade the majority in the bargaining unit to vote for recognition in a recognition ballot overseen by an independent, qualified person. It is in the trade union’s interest to be confident that it can win a majority in the ballot, otherwise it would still be prevented, as is currently the case, from applying for another statutory recognition ballot in the same bargaining unit for three years. That is why it is highly unlikely that a union will apply for statutory recognition when there is only one worker who is a member of that union. Indeed, if experience tells us anything, it is that it is highly likely that trade unions will continue to focus their efforts on larger workplaces where there is greater bang for the organising buck.

The union recognition process is generally consensual, and that is a good thing. In the nine years from 2017 to 2025, only 375 recognition applications have gone to the CAC. Close to half of the 1,476 recognition applications received since 1999 were withdrawn by unions at various stages of the recognition processes, in many cases because the parties have reached a voluntary agreement for recognition. The confrontation that has been set up by some speakers from the Benches opposite is a chimera; this is not the reality of organised workplaces. Given that, I ask the noble Lord, Lord Sharpe of Epsom, to withdraw Amendment 135.

[Lord Sharpe of Epsom (Con)]

I am grateful to the Minister for setting out the context in a bit more detail, but I am afraid I am not entirely persuaded. I would like to test the opinion of the House.

21:40

Division 4

Ayes: 92

Noes: 130

21:50

Amendments 136 to 145 not moved.

Clause 59: Requirement to contribute to political fund

Amendment 146 had been withdrawn from the Marshalled List.

Consideration on Report adjourned.

House adjourned at 9.51 pm.