Great British Energy: Nuclear Development
Earl Russell
To ask His Majesty’s Government what impact they anticipate reallocating £2.5 billion of Great British Energy’s planned budget for nuclear energy generation development will have on its ability to deliver on its planned objectives.
Lord in Waiting/Government Whip (Lord Wilson of Sedgefield) (Lab)
My Lords, Great British Energy’s mission is to drive clean energy deployment in order to create jobs, boost energy independence and ensure that UK taxpayers, bill payers and communities reap the benefits of clean, secure, homegrown energy. In the spending review, the Government pledged over £2.5 billion for the small modular reactor programme through Great British Energy-Nuclear. This programme will potentially power the equivalent of 3 million homes with clean, secure, homegrown energy. Together, Great British Energy and Great British Energy-Nuclear will invest £8.3 billion in our clean energy future.
Earl Russell (LD)
My Lords, I thank the Minister for his Answer. The Treasury cut one-third of Great British Energy’s budget and its investment powers, clipping its wings before it could fly. A renaming sleight of hand does not make Labour’s manifesto pledge add up. The promise to fully capitalise Great British Energy with £8.3 billion in this Parliament has clearly been broken. I ask the Minister either to confirm which third of GB Energy’s mission will be scrapped or to give a clear commitment to replace these essential funds, which have been taken away by the Treasury.
Lord Wilson of Sedgefield (Lab)
I thank the noble Earl for that question but I do not think that the Great British Energy budget has been cut. The £8.3 billion will be spent between the two allied companies. The small modular reactors programme, if we get a fleet of them, will generate enough energy for over 3 million homes and create thousands of jobs. In April, Great British Energy announced £3 million for offshore wind supply chains. In June, we announced another £700 million investment in clean energy supply chains. We are doing everything that we possibly can with this money, and it acts as a catalyst for future investment. All sides of the House welcome the money that we are putting into small modular reactors.
Lord Beamish (Lab)
My Lords, my noble friend mentioned small modular nuclear reactors, in which the UK clearly has an advantage in terms of technology. How can he ensure that jobs in the UK economy will be underpinned by that programme? Will it encourage young people to get into the nuclear field?
Lord Wilson of Sedgefield (Lab)
It is vital that we invest in nuclear. It will add to the baseload for electricity generation into the future. We want to see young people attracted into the industry, and growth in apprenticeships. We also want the supply chains to be focused not just in one area but around the country, in regions such as mine and my noble friend’s in the north-east of England.
Lord Ravensdale (CB)
My Lords, I declare my interest as a chief engineer working for AtkinsRéalis. I congratulate the Government on the Sizewell C announcement, which is fantastic news for the UK nuclear industry. But, alongside that, the Government need to consider enablers for nuclear, including a secure source of nuclear fuel. Can the Government say when they plan to bring forward the date for a ban on Russian imports of nuclear fuel into the UK, as the US has done, with all the benefits that would bring for forthcoming investments in the UK, international leadership in this area and our energy security?
Lord Wilson of Sedgefield (Lab)
The position of the Government is essentially that we want to see homegrown nuclear energy, as well as wind energy and hydrogen energy, so that we do not have to rely on foreign imports. I completely accept what the noble Lord said; I know it is something that the Government are looking at and want to address.
Viscount Trenchard (Con)
My Lords, could the Minister tell the House whether, following this development, it is intended that GBE should merge with what is now called GBE-N—formerly Great British Nuclear—in order to enable joined-up thinking and avoid separate decisions coming out of different silos?
Lord Wilson of Sedgefield (Lab)
I thank the noble Viscount for that question. The Government’s approach is that these two, Great British Energy and Great British Energy-Nuclear, are allied organisations that will probably work together to produce more clean energy into the future. The target for GBE-N is to focus on small modular reactors in the medium term to generate those jobs and to get a modular system, with technology that we can replicate around the country.
Lord Wigley (PC)
My Lords, I am a keen advocate of both the Trawsfynydd and Wylfa sites for nuclear development. Can the Minister give some indication of the likely timescale for SMR—not only announcements on it but when work will commence on those sites? The danger is that we are losing the race for SMR production against overseas competitors.
Lord Wilson of Sedgefield (Lab)
The preferred bidder is Rolls-Royce and I think we are ahead of the curve in all this. We are investing in the technology and we want to see it coming online in the medium to long term—some time in the 2030s. This technology will revolutionise nuclear power in the country, so that we can spread out nuclear technology around the country, build the supply chain and generate power for over 3 million homes. I think we are ahead of the curve: we know what we are doing on this and we are going to generate that energy in the future for the country.
Baroness Jones of Moulsecoomb (GP)
My Lords, the Minister said that everybody around the House supports nuclear. No, the Green Party does not support nuclear. It is a dinosaur technology and it is really very expensive, when you look at the planetary impact and the cost to the Exchequer. It is going to be a disaster and it will be overtaken by sea-level rises as well. Why do the Government not take some good advice on this instead of believing in nuclear all the time?
Lord Wilson of Sedgefield (Lab)
I appreciate that point of view, but I think it is a bit on the fringe of what this House and people in the industry think. We have to remember that once Sizewell C is geared up and producing energy, we expect it to make a saving. The noble Baroness can turn her nose up at this, but once it is online it is going to generate savings for the economy and consumers of £2 billion a year over 60 years. I think that is a good saving for the economy and for the British people. It is something that we need to continue to invest in.
Lord Alton of Liverpool (CB)
My Lords, given the announcement at the weekend that £200 million is going to be spent through Great British Energy to purchase solar panels from China, how can the Minister reconcile that with the amendment passed by your Lordships’ House that goods that may have been manufactured using slave labour in places such as Xinjiang would not be purchased by Great British Energy? Surely it would have been better to invest that money in British jobs and British production in making solar panels here.
Lord Wilson of Sedgefield (Lab)
We are talking to British producers and manufacturers of solar cells to see how we can invest in that and advance the technology on solar cells so that we do not have to rely on foreign imports. I get the noble Lord’s question on whether we are being as ethical as we possibly can be. We are building partnerships with key NGOs, including Anti-Slavery International, Rights Lab and Human Rights Watch, to ensure that civil society voices and expertise are embedded in policy design and enforcement. We need to make sure that we are not using slave labour to produce the solar cells that we will be using in this country.
Lord Offord of Garvel (Con)
The Government’s commitment to the SMR rollout is welcome, as indeed is today’s announcement on Sizewell C being given the green light. The Opposition believe that nuclear can be a significant contributor to a balanced scorecard alongside gas and renewables to give us a secure, affordable and clean energy system. Will the Government use the current Planning and Infrastructure Bill as an enabler for nuclear, to remove the often spurious and vexatious blockages of long-term planning?
Lord Wilson of Sedgefield (Lab)
I thank the noble Lord for that question. Obviously, we will do everything we can to expedite the planning process. We are very keen on infrastructure projects that are in the national interest. I want to refer to something that the noble Lord said yesterday about this Government’s approach to renewable energy. He said that it is
“anti-science, anti-jobs, anti-energy security and anti-future generation”.—[Official Report, 21/7/25; col. 92.]
As far as anti-science is concerned, I do not think that there are many eminent climate scientists who think that we are anti-science. There are 1 million jobs now reliant on green energy. Energy security is important, and that is what we want. We want more homegrown energy. That is why our investment in nuclear is important. On anti-future generation, I have three grandchildren, and if we do not do something now, they will never forgive us. It is for not just my grandchildren but everybody in this House’s grandchildren that we are doing this. We need to invest in it. We need to get the country around it. It is the patriotic thing to do.
Independent Commission on Adult Social Care
Lord Young of Cookham
To ask His Majesty’s Government what progress has been made by the Independent Commission into Adult Social Care.
Baroness in Waiting/Government Whip (Baroness Blake of Leeds) (Lab)
The independent commission has begun its work on how to build a social care system fit for the future and will first report in 2026. The noble Baroness, Lady Casey, is a trusted independent figure who will involve political parties and the public to build a national consensus around the future of social care. As the commission is independent, it is for the noble Baroness and her team to provide further updates on their progress in due course.
Lord Young of Cookham (Con)
My Lords, we have had the Sutherland report, the Wanless report and the Dilnot report; your Lordships’ House has produced three Select Committee reports on this subject in the past few years; the Health and Social Care Committee in another place has produced 10 reports in the past eight years; the Public Accounts Committee has produced four reports; not to mention reports from the Care Quality Commission, the Nuffield Trust, the King’s Fund and the National Audit Office. Frankly, asking the noble Baroness, Lady Casey, to produce another report by 2028 is a cop out. The noble Baroness can work at pace. She recently reported on grooming gangs, and the Home Secretary said she had produced
“a hugely wide-ranging assessment in just four months”.—[Official Report, Commons, 16/6/25; col. 26.]
Should she not be invited to produce a report outlining options by Christmas? That would free the noble Baroness, Lady Casey, to deal with some of the other challenges facing the Government.
Baroness Blake of Leeds (Lab)
My Lords, I think the answer is partly in the question. There have been so many reviews and inquiries, but none of them has come forward and got total ownership from across the House; that is part of the problem. All the work that has been done through those reports will be built on. I would never underestimate the noble Baroness, Lady Casey. It has been my great privilege to work with her for decades. She was responsible for introducing ASBOs for troubled families, as noble Lords may recall. This situation is complex. It needs to be tackled in depth. There are things that can been done quickly, which she will address, but it is critical that we let her do the work and use her skills to reach consensus, which, frankly, has been so plainly missing in all the work that has been attempted in the past.
Lord Laming (CB)
My Lords, the Minister will know that, as many more people are, thankfully, surviving longer despite having severe disabilities or illnesses, and as we are all ageing, there are more people living in the community than in hospitals who need continuing medical care and social support. The department is not just the Department of Health; it is the Department of Health and Social Care. In the light of what the noble Lord, Lord Young, just set out, can the Minister assure the House that, until the noble Baroness, Lady Casey, reports, health and social care will be given equal weight, and that social care will not be treated as a mere add-on to the health service?
Baroness Blake of Leeds (Lab)
The noble Baroness, Lady Casey, is working towards setting up a national care service that can work alongside the National Health Service. The noble Lord raises critical points. Given that so many people live with frailty and need in the community, it is essential that not only the NHS and social care but the voluntary sector and the wider community are involved. We have seen incredible benefits for our most vulnerable in areas that have managed this successfully. There is an enormous amount to do, as the noble Lord suggests, but we are up for the job.
Baroness Tyler of Enfield (LD)
My Lords, given that many unpaid carers are in effect propping up our social care system, often facing relentless financial hardship and strain to the detriment of their own health, can the Minister explain what specific measures the independent commission is taking to ensure that unpaid carers’ voices are feeding directly into its work and leading to real policy change for unpaid carers, not just warm words?
Baroness Blake of Leeds (Lab)
One of the real differences in the work that the noble Baroness, Lady Casey, is embarking on is that she is committed to working with unpaid carers. The noble Baroness, Lady Tyler, raises a critical point. We know how much this country relies on unpaid carers. I am pleased that we have raised the earnings limit by the highest amount since it was introduced, but the figures are staggering. The significant number of people who are carers has to be taken into account. I am delighted that the noble Baroness, Lady Casey, will work with vested interests, and unpaid carers come very high up that list.
Lord Sikka (Lab)
My Lords, between 2011 and 2023, 804 out of the 816 adult care homes that were forcibly closed by the Care Quality Commission in England were run for profit. Corporations running such homes have had profit margins of 35% to 40%, removing billions from front-line services, as is the case with many privatised essential services. Can the Minister say when the Government will end profiteering in the adult care sector?
Baroness Blake of Leeds (Lab)
My noble friend raises an important point. I would stretch that out to talk about the care market’s sustainability. The whole system is in real difficulty, not least because of the funding taken away from local authorities over the past 14 years. Local authorities have had difficulties in sustaining provision. Of course, the whole market needs to be looked at so that we can find the most cost-effective and efficient ways forward which benefit the most people from the most vulnerable cohort in our society.
Lord Forsyth of Drumlean (Con)
My Lords, the Minister is absolutely right about the problems for local authorities, which are spending some three-quarters of their budgets on social care, with the result that core services are being cut. She said that there is no consensus on this matter, but the House of Lords Economic Affairs Committee produced a report that was accepted throughout the House and was unanimous in its position, like so many other reports that have been produced.
Can the Minister admit that the problem is the Treasury and the cost, and the refusal to understand that money spent on social care will mean less cost to and take the burden off the health service? I am afraid that kicking this into touch for three years with the noble Baroness, Lady Casey, is yet another example of the Treasury playing for time and not being prepared to face up to the realities facing the most vulnerable and elderly people in our country.
Baroness Blake of Leeds (Lab)
The noble Lord raises the point about consensus. I did not mean to offend anyone in this House if the report came to consensus, but the fact is that there was a feeling, particularly in the other place, that the work could not be put on to the statute book. That is where we have the problem. We have to make sure we move forward, but I reassure noble Lords that we are not talking about putting everything on hold for three years. The noble Baroness’s interim report will look at things we can do now. In the next couple of years, we will look at the longer-term issues, particularly, as the noble Lord quite rightly said, around longer-term funding. I have faith that the noble Baroness, Lady Casey, will do a thorough job engaging with all parties and outside interests, and come up with a way forward.
Lord Kamall (Con)
To make it easy, I will resolve it.
My Lords, I take this opportunity to pay tribute to the late noble Lord, Lord Lipsey. He was on the Royal Commission on Long-Term Care of the Elderly in 1998. Many noble Lords may not know this but, before he passed away, we were working on a cross-party proposal to raise awareness of existing later-life insurance products offered by mutuals and private insurance, so that taxpayers fund only those without sufficient assets or those who lived beyond the coverage of the insurance—usually five years. Can the Minister assure us that, whatever the Casey commission proposes, given that we are looking at solutions in the short term, the Government will raise awareness of later-life insurance products currently offered by mutual and for-profit insurers, especially for those who cannot wait for the Casey commission to report?
Baroness Blake of Leeds (Lab)
I thank the noble Lord for making reference to the work of our noble friend Lord Lipsey, who will be greatly missed on all sides. I cannot pre-empt what the noble Baroness, Lady Casey, will say—I have made that point repeatedly; it is absolutely right. The noble Lord raised an interesting point of view. I am sure he will take every opportunity to feed that into the work that is ongoing.
Lord Macpherson of Earl’s Court (CB)
My Lords, one of the most sensible measures introduced by Mr Sunak when he was Chancellor of the Exchequer was a health and social care levy. Sadly, its abolition is the one measure which survived from the Kwasi Kwarteng Budget of 2022. The benefit of a health and social care levy is that it is possible to square it with the Labour Party’s manifesto. I therefore encourage the Minister to suggest that the noble Baroness, Lady Casey, also considers the funding of social care.
Baroness Blake of Leeds (Lab)
I have a feeling that the noble Lord will make sure that the noble Baroness, Lady Casey, is well aware of the issues he raises. I look forward to the outcome of those conversations.
Duchenne Muscular Dystrophy: Givinostat
Baroness Kramer
To ask His Majesty’s Government what progress has been made in making givinostat available to boys living with Duchenne muscular dystrophy to slow down degeneration, particularly becoming unable to walk.
Baroness in Waiting/Government Whip (Baroness Blake of Leeds) (Lab)
NICE is currently evaluating givinostat for the treatment of Duchenne muscular dystrophy to determine whether it should be funded by the NHS, based on the evidence of its costs and benefits. Its independent appraisal committee met on 10 July, and I understand that NICE will issue draft guidance shortly. I hope noble Lords will appreciate that it would not be appropriate for me to speculate on NICE’s draft guidance or to seek to influence the outcome.
Baroness Kramer (LD)
My Lords, boys M and H are friends aged 14 and 11, and both have Duchenne muscular dystrophy. Boy M is receiving givinostat, provided by his NHS trust, and expects to preserve his ability to walk and to be eligible for new drugs in the pipeline. Boy H’s NHS trust is not providing him with givinostat. His family fear he will lose his ability to walk before September, and he is unlikely to be eligible for future drugs. Givinostat is cost-free from the manufacturer under the early access programme, but delivery and monitoring costs fall on the NHS. What can the Minister say to boy H and the 400 other boys like him who are losing in the postcode lottery? Will she meet with some of the families?
Baroness Blake of Leeds (Lab)
The noble Baroness raises a very interesting point. The drug companies will provide the drugs for free, but it is down to individual trusts to pay the administrative costs. She highlights that one boy in one trust is being supported, while another boy is not. It is a difficult situation; I completely understand that, and my heart goes out to all the young people who suffer from this dreadful disease. It is critical that the trusts work together and look at other practice. It is not for the Government to intervene and force trusts to do as the noble Baroness proposes. However, if they choose to do so, companies can provide funding to enable the clinical administration of their products in advance of the NICE decision. Perhaps the noble Baroness could go back and recommend that as a course of action.
Lord Kamall (Con)
My Lords, we heard from the noble Baroness, Lady Kramer, that there is an early access programme for a new treatment of Duchenne muscular dystrophy in the UK. Can the Minister share any intermediate observations or results from the early access programme? As the noble Baroness, Lady Kramer, asked, are there any plans to extend or expand it?
Baroness Blake of Leeds (Lab)
I cannot comment on this case as the decision has not been made public yet; that would be completely inappropriate. If NICE does give its approval, the Secretary of State has committed to bringing it in. We are looking at ways in which we can get the medicines for rare diseases to which NICE gives its approval to where they are most needed as speedily as possible.
Lord Sharkey (LD)
My Lords, I declare an interest as a trustee of Muscular Dystrophy UK. Following the previous question, can the Minister say whether the early access programme really works? How many other drugs have been licensed under the programme, how many were eventually approved by NICE and how many were declined? If the application for NICE approval of givinostat is unsuccessful, what will happen to the patients currently undergoing treatment with the drug? Will that depend partly or entirely on the pharmaceutical company that makes the drug?
Baroness Blake of Leeds (Lab)
I cannot give the detailed answer on the numbers that the noble Lord is after, but I am very happy to write to him. We have this experience in a whole range of other medicines, but I appreciate the noble Lord’s particular interest in this. This is a very difficult area. It is for NICE to look at the best way forward on providing medicines that give the best results and value for money and achieve the right outcomes. This is an ongoing situation, and I am happy to write to the noble Lord on the detail.
Lord Evans of Rainow (Con)
My Lords, I witnessed a close family member suffer with this dreadful disease, and the Minister is right to say that she cannot comment on the actual drug and NICE’s decision. However, before this drug is administered, you require blood-clotting platelets so that the drug can have the best effect. However, there is a big shortage of platelet donors within the NHS, as the noble Baroness may be aware. Waiting for NICE’s decision may be part of the administration cost of administering this drug, but one thing it may use to say it cannot do it is a shortage of donors, so perhaps we can proactively ask the NHS to look into how we can get more donors for platelets.
Baroness Blake of Leeds (Lab)
The noble Lord touches on a very sensitive matter that could be replicated around a variety of issues. Looking for more people to come forward is a perpetual challenge, and I am sure that everything should be done to encourage people to do so. I am sure that many people do not know that this is an issue, and some promotion could be helpful.
Lord Kakkar (CB)
I draw the House’s attention to my registered interest as chairman of King’s Health Partners. The 10-year plan recently published by His Majesty’s Government, with regard to the future of the NHS, puts at its very centre the adoption of innovation at scale and pace to transform the health service and secure its sustainability. What arrangements are in place, and what assessment is being made of those mechanisms? In particular, do His Majesty’s Government have a view about advancing the opportunity for early adoption of innovation in such a way that the kinds of problems we have heard about in this short Question are not repeated on several occasions, and the ambition to transform the health service with innovation is not frustrated?
Baroness Blake of Leeds (Lab)
The noble Lord raises a crucial point: there is no point having all the work going into innovation if we cannot implement it. It is at the centre of the 10-year plan. A process is being worked up to look at how we can bring the best of our innovation and technological advancement into clinical practice. I am grateful for his input into this area, and I know that this will be taken very seriously as we move forward.
Baroness Blackwood of North Oxford (Con)
My Lords, I declare my interest as chair of Genomics England and Oxford University Innovation. This product is a classic example of one that should be eligible for the innovative medicines fund. However, concerns have been raised about the clarity of entry criteria, transparency and scale of ambition. What steps are being taken to tackle those challenges in order to address the concerns raised by the noble Lord, Lord Kakkar?
Baroness Blake of Leeds (Lab)
I am not sure that I can add a great deal more, other than to refer the noble Baroness to the 10-year plan, where innovation is absolutely at the core and the centre. We are where we are, and her point is about how we move from here to where we need to be. We need to make sure that there is a real focus on moving all that expertise into actual practice to bring benefit to as many patients as possible.
Baroness Burt of Solihull (LD)
My Lords, currently only 70 of the 500 children with Duchenne are accessing the trial of givinostat. We are hoping for a decision on 18 December from NICE, but my worry is about how long the rollout will take for sufferers and their parents. They want to know how long it will take for those who are not included in the fortunate 70 currently receiving givinostat, and for others in categories that may also be helped.
Baroness Blake of Leeds (Lab)
I recognise the noble Baroness’s concern and in-depth knowledge about this situation. I need to repeat at this point that it would be wrong of me to speculate on the outcome. I hope that the decision will be earlier than the date she mentioned. When the guidance is published, we will be in a much better position to assess next steps.
Illegal Migration: Pull Factors
(1 day, 6 hours ago)
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Lord Empey
To ask His Majesty’s Government what assessment they have made of the “pull factors” attracting migrants to enter the United Kingdom illegally.
The Minister of State, Home Office (Lord Hanson of Flint) (Lab)
The Government are committed to tackling illegal migration and the criminal networks behind it. We have launched campaigns directed at misinformation on pull factors and are taking a tougher action on illegal working in particular. There is no single universal pull factor independently driving irregular migration to the UK. In many cases, asylum seekers or illegal migrants are being directed or even coerced by organised criminal networks. The Government keep all these issues under review.
Lord Empey (UUP)
I thank the Minister for his response. The Minister is currently introducing some minor measures to make it more difficult for the traffickers facilitating small boat crossings, and I support those measures, but does he believe that it is sustainable for us as a nation to admit between 10,000 and 23,000 migrants per week, largely legally, meaning that we are increasing our population by at least 500,000 per year indefinitely? Will he confer with his colleagues in government with a view to convening all-party talks to try to reach a consensus on how migration is to be dealt with long term, and commence a national conversation with the objective of reducing the anxiety and toxicity around this issue?
Lord Hanson of Flint (Lab)
The noble Lord is absolutely right that we need to reduce the anxiety and toxicity around this issue. I reassure him that, first and foremost, the Government are committed to meeting their international obligations, which include asylum claims legitimately put before the United Kingdom. He may have noticed that an immigration White Paper was produced recently by the Government, which raises a number of issues. We need to look at pull factors, certainly, but the Government are also taking very strong action on cross-border, cross-channel issues, including the removal of people who have failed their asylum claims, the removal of foreign national criminals and the removal of individuals who are illegally working in the United Kingdom, as well increasing prosecutions. There is a range of measures, and we discuss this internally in government every day of the week.
Lord Clarke of Nottingham (Con)
Immigration is a global crisis, with every wealthy country in the world suffering social and political pressures from unsustainable levels of immigration from poorer countries. Do the Government therefore agree that there needs to be international co-operation involving the British Government before this can ever be solved? Are the Government engaging with the 15 or so European countries and the European Commission in the discussions that they are having about trying to close the southern European border? A policy on that subject would greatly reduce the number of people reaching the camps in Calais. Are the Government involved in that?
Lord Hanson of Flint (Lab)
The noble Lord is absolutely right. In April and May this year, the Government were involved, along with 50 nations across the European Union and elsewhere, in examining the drive factors—rather than the pull factors that the noble Lord, Lord Empey, mentioned—that are pushing people away from areas of conflict, hunger or starvation into the Mediterranean and beyond, into Europe. The Government are looking very strongly, with European partners, at how we can work internationally in Europe and in the United Kingdom to ensure that we tackle those drive factors as well. That is why we have had the Calais Group of Belgium, Holland, France and the United Kingdom, and the recent discussions with the Germans last week and with the President of France only a couple of weeks ago. That international action is absolutely essential.
Lord Dubs (Lab)
Will my noble friend confirm something that the young people in Calais told me when I was there—namely, that if they enter the EU in Greece or Italy they are pretty well obliged to be fingerprinted and indeed recorded as asylum claimants? Therefore, they cannot claim asylum in France, and tell me that there is then nowhere else to go except the UK. Will the recent agreements with France and other EU countries deal with that?
Lord Hanson of Flint (Lab)
I am grateful to my noble friend for his comments. Through the agreement with France we are trying to ensure that those who reach the United Kingdom illegally by crossing the channel have their biometrics taken and are returned to France as part of an exchange of legal asylum seekers who are being cleared by the French to claim asylum. That is a pilot scheme that is being looked at much more widely. When we have assessed it post the Summer Recess, we will look at whether it has been successful or not. It is quite clear that the taking of biometric information, in Europe and the United Kingdom, is key to identifying and processing individuals who are genuine asylum seekers and distinguishing them from individuals who are here by illegal means or who have been trafficked by people traffickers.
Lord German (LD)
My Lords, I draw attention to my interests and to the fact that I am supported by the RAMP organisation. We clearly need robust information and evidence about which factors are actually influencing these movements. Current knowledge is limited and sometimes incomplete and outdated. Will the Minister commit to commissioning and publishing more comprehensive data and research, so that future policy is guided by clear evidence rather than by assertion, assumption or anecdote?
Lord Hanson of Flint (Lab)
I cannot commit to that, I am afraid, simply because the Home Office currently undertakes significant research on those very factors. Self-evidently, the English language is a pull factor for people, because English is a very common and well-understood language throughout the world. The perception of the UK as a place where work can be gained is important, but that work tends to be illegal, which is why we have had a major push in the last 12 months on illegal working. There are other factors at play in relation to that movement. We are monitoring those at the Home Office. I am happy to look at other research that is done, but this is the daily business of the office that I represent in this House.
Lord Mountevans (CB)
My Lords, have the Government given consideration to the introduction of identity cards, together with the requirement that in order to get work people are required to have identity cards? Would this not make a profound difference to the employment prospects of those arriving illegally?
Lord Hanson of Flint (Lab)
We collect biometric data. I have said many times in this House that, when I was last a Home Office Minister, in 2009-10, we had identity cards and we planned to expand them further. They were scrapped by the then coalition Government. That is a decision that we may all wish to reflect on. Indeed, I know that some Members who voted for that now reflect with some passion that it was the wrong decision at the time. We need to focus on where we are now. It is not about building a wider identity card system but about gathering the identities of those who come here illegally, ensuring that those who claim asylum do so properly, processing them very quickly and returning those who are here illegally or who do not meet the asylum criteria.
Lord Davies of Gower (Con)
My Lords, some 22,000 people have used small boat crossings to illegally breach our borders so far this year, which is some 57% up on the same period last year. The situation is quite obviously out of control and the pull factors are overwhelming any deterrent effect that the Government wish to create with their border security Bill. Will the Minister please update the House with the latest biographical information he has on those arriving in small boats—I realise that perhaps he does not have it to hand today? What is the average age of those arriving? What is their sex? Can he tell us the reason most commonly given by them as to why they have come to the UK illegally? As I say, if he does not have that information, perhaps he would write to me and put a copy in the Library.
Lord Hanson of Flint (Lab)
I cannot give the noble Lord chapter and verse on all that detail in the half a minute that I have to answer his question, but I can say that 35,000 failed asylum seekers who came on small boats were removed last year, which is 13% more than in the 12 months previous, when his Government were in charge. There has been a 51% increase in the number of people who have been arrested and prosecuted on illegal working visits. We are taking action on these difficulties. Although he says that the figure is high now, and it is, it is nowhere near the 43,000 people a year who were coming in 2018. In 2016, only 400 people crossed the channel, and I think he knows who was in charge when that rise occurred.
Baroness Ritchie of Downpatrick (Lab)
My Lords, could my noble friend the Minister indicate whether the Government considered working in the social care sector as one of the pull factors for illegal migrants entering the UK when they decided in their White Paper to remove the social care sector from the list of occupations that can recruit migrant workers? Did they take into consideration the need for adequate staffing in the sector and the reported high number of vacancies?
Lord Hanson of Flint (Lab)
I am grateful to my noble friend. She raises a sector where there are employment shortages. One of the tasks of the Government in the employment and immigration White Paper is to reskill and upskill individuals from the United Kingdom to fill those vacancies. With social care visas, there were significant issues regarding non-compliance and exploitation by unscrupulous employers. We have had to take steps to address those concerns and will continue to do so, but we also need to work with the Department of Health in England and with the devolved Administrations in Northern Ireland, Scotland and Wales to ensure that we look at how we fill those vacancies and what the needs are. We have a transition period until 2028, which will permit visa extensions and in-country switching for those already in the country, but we need to make sure that that system is not abused. Sadly, I have to report to my noble friend that it was, so this Government are taking action.
Enterprise Act 2002 (Mergers Involving Newspaper Enterprises and Foreign Powers) Regulations 2025
(1 day, 6 hours ago)
Lords ChamberRead Hansard Text Watch Debate Read Debate Ministerial Extracts
17:58 - Division on Lord Fox’s amendment. - Ayes: 155 / Noes: 267 - Lord Fox’s amendment disagreed.
Baroness Twycross
That the draft Regulations laid before the House on 15 May be approved.
Relevant document: 27th Report from the Secondary Legislation Scrutiny Committee (special attention drawn to the instrument)
The Parliamentary Under-Secretary of State, Department for Culture, Media and Sport (Baroness Twycross) (Lab)
My Lords, I shall also speak to the Enterprise Act 2002 (Amendment of Section 58 Considerations) Order 2025 and the Enterprise Act 2002 (Definition of Newspaper) Order 2025.
This set of regulations will broaden the scope of media merger regimes and strengthen the public interest protections, as well as setting the scope of exceptions that will apply to foreign state influence in UK newspapers. Taken together, these are the most significant changes to the media public interest regime since the Communications Act 2003. I know that many noble Lords have sincerely and strongly held views on the matters to be debated today and I am grateful to those across your Lordships’ House who have met me, the Secretary of State or officials to discuss them. It is good to see the noble Lord, Lord Fox, back in his place.
I will go back to first principles to place the new measures in their proper context. Fundamental to this is the need for us all to consider the very real risks to the survival of UK newspapers, including very high-profile names, and the wider news media. I understand and share noble Lords’ concerns about the growing threat of foreign state actors seeking to undermine our institutions and our democracy. There is a risk that this might translate into efforts to interfere with our media and freedom of the press. This is not the only risk, although it is a risk that these measures seek to manage.
The far greater risk is how UK news media, national and local, face significant, genuinely existential—I do not use that word lightly—challenges as their business models move away from print towards digital, and new technologies emerge. Publishers have sought to consolidate and make efficiencies in response, with three publishers accounting for over 80% of national print copy sales in the UK, and three accounting for about 70% of the local news market. There have been some notable successes for newspapers that have been able to develop and deliver a strong subscription offer, but others have fared less well. Some are struggling in an economy where good-quality news content does not always translate into the revenues that our news media needs to prosper and innovate.
The issue is seen most starkly in our local media, a particularly trusted news source that has consolidated to survive, and in many places local newspapers have had to reduce journalist numbers to a bare minimum. While it is vital that we support stronger protections for UK newspapers and other news media, we need to make sure that we do not inadvertently make it harder for newspaper groups to survive.
A UK-wide free press, which I know all noble Lords value—the type of press landscape we are rightly proud of in this country—also has to be sustainable. Let me be clear: the Government are unequivocal supporters of a free and plural news media, even when it does not agree with us. A free media is an essential safeguard that ensures accountability and effective government. The measures being debated strongly support this objective.
Lord Forsyth of Drumlean (Con)
Is the Minister seriously arguing that the survival of our newspapers, both national and local, depends on changing the law, as she is doing, to allow foreign Governments to have ownership of them?
Baroness Twycross (Lab)
It is important to distinguish between foreign Governments and state-owned investors. If the noble Lord will allow, this is covered in my opening remarks.
The first set of measures extend the scope of the media merger regime to online news publications. The Enterprise Act 2002 (Definition of Newspaper) Order 2025 will amend the definition of “newspaper” in the Enterprise Act 2002 to encompass both print and online newspapers and periodical news magazines. Crucially, this will enable the Secretary of State to intervene on public interest or foreign state influence grounds, subject to jurisdiction, in the acquisition of an online-only newspaper. Until now, she has not had the power to do so. The Enterprise Act 2002 (Amendment of Section 58 Considerations) Order 2025 creates the term “news media”, which captures newspapers, as newly defined, and news programmes that are broadcast. The order extends key public interest considerations in Section 58 of the Enterprise Act 2002 to all news media.
Noble Lords have long called for these changes, and Ofcom recommended them in its 2021 and 2024 media ownership rules reviews. The definition of newspaper order also ensures that the foreign state influence regime introduced in May last year will be extended such that foreign powers will now also be banned from acquiring control or influence over the policy of an online newspaper or an online news magazine enterprise.
Let me now turn now to the draft foreign state influence exception regulations, which are the subject of the fatal amendment in the name of the noble Lord, Lord Fox, and the regret amendment in the name of the noble Baroness, Lady Stowell of Beeston. The FSI regime, for which, as noble Lords will be aware, the previous Government legislated in May last year, bans foreign states from having any control or influence over the policy of UK newspapers or news periodicals. The legislation includes a wide definition of foreign power that includes sovereign wealth funds and public pension funds, among the largest investors globally, whose objectives are to seek long-term, stable investment opportunities in sectors requiring new capital for growth.
The previous Government also made clear before the election that they would put in place exceptions to encourage investment by sovereign wealth and other state-owned investors and issue a consultation. To clarify —in response to the point from the noble Lord, Lord Forsyth—this exception applies only to a very narrow group of public bodies: sovereign wealth funds and public pension schemes or similar. It does not apply to states themselves or other state bodies, so a foreign Government cannot buy and own a newspaper.
The responses received, including from News UK, said that the proposed thresholds were overly complex and drawn too tightly. We broadly agree with this assessment; we believe that a higher 15% threshold is appropriate and would meet their concerns. However, this would not weaken the regime. The 15% threshold would still be below the level that the CMA considers typically gives rise to material influence when assessing jurisdiction under the Enterprise Act 2002, meaning that the risk of influence would be low.
Noble Lords have raised questions about whether an investor with up to 15% of shares or voting rights can really be a passive investor. The regulations include a strict requirement that the state-owned investor must hold the investment passively. They must have no right or abilities to appoint or fire directors or other officers, and they must have no ability to direct, control or influence a newspaper’s policy or activities. These are continuing requirements that must be satisfied every day the shares are held. The exceptions should be seen as a privilege and not a right.
The legislation requires the Secretary of State to refer a merger to the CMA if she suspects that a state-owned investor is not entitled to the exception or is not complying with these requirements. If the CMA advises that the investment does not comply and concludes that a foreign state newspaper merger situation has arisen, the Secretary of State must take action to unwind the transaction or to block it. This is a very significant penalty and safeguard.
As noble Lords will be aware, the Government published a further draft SI for consultation last week to deal with two specific concerns that noble Lords raised about the draft regulations, which we laid on 15 May. First, the changes proposed by the draft SI would close off any risk of multiple state-owned investors acting on behalf of different states, each being able to hold up to 15%. This change would be applied retrospectively from 13 March 2024 to ensure that there is no regulatory gap.
Secondly, we have addressed concerns around the lack of a notification requirement on state-owned investors who plan to take significant shareholdings. This second draft SI proposes a new requirement for direct investments by state-owned investors of more than 5% to be notified to the Secretary of State as a condition of the exception. If the notification is not made, or made late, the investment would not comply with the exception and would be prohibited.
Following a consultation, which will run until 16 September, the Government will aim to lay, in draft, the second statutory instrument by the end of October. The new notification requirements will come into force after the second regulations are made. The changes proposed in the second draft SI, while important, are not fundamental to the operation of the exceptions and not so critical to the FSI regime that we should delay these regulations and leave newspapers—which are publicly calling for us to act—to a further period of uncertainty. I thank the noble Baroness, Lady Stowell, for her constructive engagement with the Secretary of State and DCMS officials on these issues. I hope that she and other noble Lords who have raised these concerns feel that this safeguard fully deals with the issue.
I will now address the constitutional questions that arise from the amendment to the Motion in the name of the noble Lord, Lord Fox. The second regulations to follow later this year will strengthen protections and put the issue of multiple-state ownership beyond doubt. As I explained earlier, the provisions on multiple-state ownership will be backdated to 13 March 2024 to ensure that there is no regulatory gap.
It is also important to recognise that existing sovereign wealth fund investments at any level made after March 2024 in a UK newspaper may trigger the Secretary of State’s requirement to intervene under the FSI regime. We are very concerned that a protracted delay in putting exceptions into place would prolong the uncertainty this creates for investors and the wider investment climate. I appreciate that the noble Lord’s amendment comes from concerns around the impact of the FSI regime on the British press. I have not come to the same conclusion that he has, and I will of course reflect very carefully on the points that he and other noble Lords make during this debate.
It is perfectly legitimate for your Lordships’ House to debate the fatal amendment before it today, but it is a very firm convention that the power to annul is not used. In this specific case, the FSI exception regulations have been expected since the passage of the digital markets Act last year. They have been subject to consultation and extensive parliamentary engagement and have now been approved in another place. This Government have come to a different conclusion to the previous Government on thresholds. Although the threshold is slightly higher, it is also simpler and supplemented by additional safeguards. I have set out our reasoned arguments for settling on 15%, including why we gave weight to the views of UK newspaper groups that are directly affected.
When noble Lords debate legislation, a small but significant phrase is sometimes heard: that Parliaments cannot bind their successors, and commitments made by one Government cannot bind any future Government. While the 5% and 10% split threshold was announced by the previous Government during the debate on the digital markets Bill as a possibility, and subsequently featured in the consultation, it was not a settled matter. It was left open at the time of the general election last year. It is both right and responsible for the Government to look at this afresh. However, we agreed that in some sensibly managed circumstances, an exception to the regime was reasonable. Our intention in doing so is to make a decision which protects press freedom from foreign state interference while not, in the words of one consultation respondent, creating a chilling effect on the investment the British press tells us it so badly needs.
To conclude, I urge Peers from all sides to look at these issues in the round. The Government believe these regulations provide the certainty that UK newspapers desperately need and have asked for. They will, in spite of suggestions to the contrary, guard against foreign state influence while allowing our news media to face the future with confidence. I hope noble Lords will accept the rationale I have presented to the House in support of this important package. I beg to move.
Amendment to the Motion
Lord Fox
To leave out from “that” and to insert “this House declines to approve the draft Enterprise Act 2002 (Mergers Involving Newspaper Enterprises and Foreign Powers) Regulations 2025, as the proposal to allow foreign states to own up to 15 per cent of UK newspapers constitutes a direct threat to the freedom of the British press; and is contrary to the policy intention of the Digital Markets, Competition and Consumers Act 2024.”
Lord Fox (LD)
My Lords, I thank the Minister for her kind words and the time that she gave to meet virtually.
Your Lordships will see that this is a fatal amendment. I know that this House is not in the habit of supporting such actions, but to do so is perfectly in order. The Joint Committee on Conventions 2006 report concluded that
“in exceptional circumstances, it may be appropriate”
for the House of Lords to reject statutory instruments.
“This is consistent with past practice and represents a convention recognised by opposition parties”.
I shall seek to demonstrate that this instrument is indeed an exceptional issue, that ownership of our press is a matter of great public policy importance and that we are fully entitled to defeat this statutory instrument.
I was encouraged by the fact that His Majesty’s loyal Opposition tabled and voted for a fatal Motion regarding the Chagos treaty on 30 June this year. Clearly, they also believe that some issues warrant fatal Motions. I am deeply grateful for the support and friendship of colleagues right across party lines, including Conservative, Labour, Cross-Bench and independent Peers. We all understand how serious it is for the Lords to take such an action. We cannot sit by and watch this happen before our eyes.
I remind fellow noble Lords that the Government’s planned secondary legislation deliberately reverses the explicit will of your Lordship’s House: to be specific, the then Digital Markets, Competition and Consumers Bill, debated in the House of Lords in March 2024. Hansard is clear regarding the intention of amendments made to the Bill. At Third Reading, your Lordships loudly welcomed a complete ban on foreign Governments having either ownership of or influence on our press. This was greatly motivated by Members’ concerns about the proposed acquisition of the Telegraph Media Group that included a stake from a company ultimately controlled by a member of the United Arab Emirates Government. Subsequently, the then Government said that they would use secondary legislation to introduce an exemption for shareholdings of up to 5%. This was introduced to avoid unintended consequences. Then there was the consultation, to which the Minister referred, run by the Department for Culture, Media and Sport—DCMS—on the threshold.
Your Lordships’ Secondary Legislation Scrutiny Committee singled out DCMS for its decision to treat information about the respondents to a public consultation confidentially. It was critical, and it noted that
“this is an unusual approach”.
Indeed, it is. It took freedom of information requests to ensure that the Government published the consultation responses just a few days ago, with redactions. It should not have been necessary to resort to FoI requests, especially given the weight the Government place on this consultation, but it is easy to see why DCMS was reluctant to publish the results, as there is a strong vested interest that runs through the responses. Three of the four responses—yes, there were just four—were from parts of the newspaper sector that are almost certainly seeking foreign investors.
The Government said that they have carefully considered the consultation responses and introduced this instrument as a result. DCMS explains that the
“new threshold responds to feedback received during consultation from newspaper groups affected by the new regime”.
This is hardly surprising, given the nature of the handful of respondents and their obvious hunger for investment.
The Deputy Speaker (Lord Geddes) (Con)
My Lords, I must inform the House that if the amendment in the name of the noble Lord, Lord Fox, is agreed to, I will not be able to call the amendment in the name of the noble Baroness, Lady Stowell of Beeston, for reasons of pre-emption. The Question I therefore have to put is that the amendment in the name of the noble Lord, Lord Fox, be agreed to.
Baroness Stowell of Beeston (Con)
My Lords, although I take a different position on this from the noble Lord, Lord Fox, I too would like to welcome him back to his place, and I am pleased to see that he is making a good recovery from his accident.
Last year, the House protected and guaranteed press freedom by forcing the Government to change the law and put beyond doubt the risk of a foreign Government owning, controlling or influencing a British newspaper. None the less, we accepted that it would be necessary to allow limited exemptions to state-owned investment funds to ensure the industry’s financial viability. So the principle of what we are debating today is not new. Although I do not endorse how the noble Lord, Lord Fox, depicted some of the differences, we certainly cannot deny that the regulations before us today present a different model from the one we were promised over a year ago. The cap is, as we have heard, 15%, not 5%, and instead of distinguishing between different states’ investment funds so that only some are permitted, all are included but limited to passive investment only.
The other thing we should not ignore is how badly the Government have handled this whole process and made arriving at a solution far more complicated than it needs to be. I will come back to that in a moment, as well as raising some questions for the Minister to address when she comes to wind up.
The question I have grappled with is whether a 15% cap, restricted to passive investment only, still supports the much bigger principle of press freedom that we fought hard to protect. I have concluded that, with some safeguards, it does, and in reaching my view, I have not just considered what is best for the future of the Telegraph, I have very much taken account of how we need to safeguard the future of the whole news industry. Because, while we all care about protecting a free press, upholding that principle will serve little purpose if our news industry cannot survive, and its economic conditions are worsening.
Last year, when I brought forward my amendment, the Communications and Digital Committee was conducting a major inquiry into the future of news. It was plain to see then that the news industry was in jeopardy and its business models threatened like never before. The Minister has already outlined how the pace of technological change, as well as fierce and unfair competition from the tech sector, has eaten away at advertising revenue for many years. But the situation has accelerated since last year. The sharp decline in traffic to news websites from AI-generated news summaries via search pages or models such as ChatGPT, never mind the ongoing uncertainty over copyright law, which the House has debated many times in the last few months, presents an existential threat—I repeat that phrase which the Minister used, because I genuinely think that is real.
By the way, it is also worth pointing out that the major foreign tech platforms, which curate news stories based on algorithms and provide these AI summaries, are far more powerful and potent in shaping public opinion than any British newspaper. They have access to all the investment capital they need, without any constraints as to where they source their funds.
The news industry needs to invest heavily to compete with the tech sector, yet its routes to readers and revenue streams are shrinking rapidly. Subscription is not a viable model for all organisations, with the mid-market red-tops and local news at gravest risk. But, even though market consolidation is likely and conditions are bad, we can be confident that our action last year dealt with the threat of several British newspapers or news organisations ending up in the hands of foreign powers. Now, we need to make sure that the UK news industry itself can respond to the challenges it faces.
Lord Forsyth of Drumlean (Con)
Before my noble friend leaves the point, would she just pick up on what the noble Lord, Lord Fox, said? She just described the plight of the Daily Telegraph and other newspapers, basically saying they are struggling to be viable. So why would a foreign Government pay a premium price to invest in them? Are we assuming that foreign Governments are profligate with their money and that they do not invest to get a return? The noble Lord’s point was that the reason why they are prepared to pay £500 million or whatever it is for the Daily Telegraph, when other people are prepared to pay only £300 million or whatever, is that they are buying influence.
Baroness Stowell of Beeston (Con)
As my noble friend knows and as I have already described, we are now in a different situation from that which we were facing in March of last year, when there was a real prospect that a foreign Government could be the owner of a British newspaper. That matter has been dealt with. What we are dealing with now is state investment funds and, as I am going to come on to talk about, the question is whether the safeguards in place are sufficient.
I am grateful to Lisa Nandy for meeting me on several occasions over the past few months and I am pleased that, because of pressure from me and other noble Lords, the intolerable prospect of multiple foreign powers each owning 15% of a newspaper will be ruled out in the supplementary regulations that the department published in draft last week. Let us be absolutely clear: the 15% must be an aggregate cap. But how on earth that loophole went unnoticed is hard to understand and, once it was pointed out to them, it is baffling, as well as hugely regrettable, that the Government took two months to find a way to close it and chose to do so via additional regulations, instead of immediately withdrawing the regulations before us today and relaying a comprehensive set, so that we could tie all this up in one go before the Summer Recess. I would be grateful if the Minister could tell us why they could not do that. I know she has told us that they plan to lay the supplementary regs by the end of October, but I would like to know why it was not possible to do what I advised them to do back in May.
This foot-dragging and apparent incompetence have given rise to legitimate questions about who or what has really influenced the Government’s approach to this incredibly important matter. If the Government were acting only in the interests of the press industry, we would have sorted all this and resolved the Telegraph’s ownership long before now.
Although I can accept a 15% aggregate cap for state-owned investment, it will require rigorous government oversight of the boundaries that passive investors must not extend, and Parliament will need to be better equipped and more active in holding Ministers to account. In my view, it was frankly unacceptable for the Government to stay silent for 11 months on the matter of the secondary regulations and on what they were doing to safeguard the Telegraph’s future ownership during that time.
Noble Lords may have seen, and indeed have heard already from the Minister, that the supplementary regulations that are to follow these include a new notification requirement, meaning that any state-owned investor that acquires more than 5% must notify the Secretary of State within 14 days of that acquisition to be eligible for the exemption status. In my view, as a follow-on to that, the Secretary of State should be required to notify Parliament twice yearly about any or nil such notifications, together with information about action taken by her as a result. In future, we are going to need more information. Can the Minister ensure that this additional requirement of accountability to Parliament be added to the supplementary regulations the Government are now consulting on?
Although parliamentarians must respond to any failings by Ministers, when it comes to upholding press freedom, the most important line of defence is the newspaper proprietors. They are who and what must provide a strong shield between newsrooms and illegitimate pressure or demands from investors and advertisers. They know that not doing so undermines public trust in journalism, and that would damage the value of their investment.
It is not for Parliament to dictate how proprietors should discharge their responsibility, but in a media world that includes the presence of state-owned investors, clarity and some transparency about what proprietors are doing to protect their newspapers’ independence and editorial freedom becomes important. This is particularly so where proprietors are new to the newspaper industry or are private equity funds. Can the Minister tell us, therefore, what such demands the Government will make of the new Telegraph owners if and when that transaction is completed? Can she confirm that the Telegraph deal, once finalised, will be subject to detailed scrutiny by the CMA before it is completed?
If the noble Lord, Lord Fox, pushes his amendment to a Division, I will vote against it. Of course, as a former Leader of your Lordships’ House, I have a general aversion to this Chamber seeking to block legislation. Indeed, it was me, as Leader, who was the last Minister at that Dispatch Box defeated by this House on a piece of secondary legislation. But I am not against this amendment for any kind of constitutional-like reasons of convention or tradition, important though they are. Believe me, if I thought that supporting this amendment was the right thing to do, I would. But I do not.
While I respect those who are framing this debate as a battle over the future of press freedom, actually, if it is a battle about anything, it is over the future of a financially viable press. We do not just need our newspapers to be editorially independent; we need them to survive.
When it comes to the Telegraph, of course I would have loved someone serious to have come along with a consortium that could offer investment and honour a cap of 5%. Indeed, I would have loved it if this sorry saga, which has been so destabilising to the editorial team at that newspaper and has gone on for more than two years, could have been avoided altogether. But, as I have already argued, this is not just about the Telegraph; it affects all newspaper titles.
The regulations before us set the cap at 15%. As long as the Government follow through with the supplementary regulations to close that loophole and are prepared to give the necessary undertakings to ensure that that cap will be enforced, I am willing to accept them. Everyone else gets to fight another day; let us make sure the same applies to the Telegraph Group and the wider UK press industry.
Of course, if the noble Lord, Lord Fox, withdraws his amendment and supports mine instead, noble Lords can express their regret and record their dissatisfaction with how the Government have handled this matter by supporting my amendment.
Baroness Boycott (CB)
My Lords, I rise to support the Government on this measure. I think that 15% passive ownership is perfectly okay. I very much support a lot of what the noble Baroness, Lady Stowell, said about the roles of proprietors. I have edited three national newspapers, so I know a lot about proprietors. Indeed, my last proprietor sold our newspaper to a man who had made his money out of Big Ones and Asian Babes. If that is considered a good way to pass things on, I would really question this.
A passive investment is perfectly okay and, as the noble Baroness, Lady Stowell, said, the power and influence of a newspaper is absolutely about the proprietor. The proprietor will appoint an editor who is more or less in line with them. If this investment is passive, the Government have done something valuable because we have a lot of problems in our press and with various things. For instance, the Independent is highly linked financially to Saudi Arabia. I declare an interest as Geordie Greig, the editor, is a friend of mine. We have discussed this endlessly. He says that you cannot find any influence of Saudi Arabia within his newspaper, and I agree. The fact that it does a Saudi Arabian issue is its business. I am not saying I like it, but it is making a newspaper, which many of us read, available free at the point of delivery, and all sorts of good things that are otherwise going to disappear.
Rupert Murdoch is a very complicated proprietor. A lot of the stuff to do with phone hacking is still not resolved. It is very rich of the noble Lord, Lord Fox, to say that everything is going to fall apart if we get some investment in the Telegraph. Proprietors have politics and they want things to be done their way. The Government have a right, indeed, a duty, not only to make sure that this passive investment is kept that way, but to look at the whole question of proprietors. Obviously, they are going to want influence, so it is very important that the Government carry on if this is going to be about general press and, indeed, media regulation, which looks also at online regulation. Heaven knows where the money for all of that is coming from.
We need to have very firm standards here. In the meantime, I thoroughly support what the Government are proposing today, and a fatal amendment against it would be a real mistake.
Lord Black of Brentwood (Con)
My Lords, it is a pleasure to follow the noble Baroness. She and I probably have not always agreed on everything, but I echo every word that she said today.
I have thought long and hard about whether to take part in this debate, but as it touches on two subjects very close to my heart—the sustainability of an independent free press and, in practical terms, the future of the Telegraph Media Group—I concluded that it would be irresponsible not to do so.
Let me declare my interests—and I mean that in the broadest possible sense. First, I hope that all noble Lords will recognise my unwavering commitment to press and media freedom, a cause that I have championed passionately for three decades. I have stood up consistently and robustly for it in this House, even when it has been deeply unpopular and unfashionable to do so, and I would never support anything that I believed would damage it. I stood almost alone in opposing the imposition of statutory controls in the Crime and Courts Act 2013, and what became Section 40. I campaigned for 11 years for its repeal, in the teeth of opposition from the Liberal Democrat Benches. I note with some irony, given that they have such a track record, that they are putting forward this fatal amendment today in the name of press freedom, and we should not fall for it.
Secondly, I have worked for the Telegraph Media Group for exactly 20 years this September, which is half my working life. I love the Telegraph, and the protection and promotion of its safety, security, editorial independence and freedom, and sustainability are etched into my DNA. I would never do anything to compromise that, and I declare my interest as its deputy chairman. It is for both those reasons, philosophical and practical, that I make these few remarks.
The news publishing industry in the UK does face— I will be the third person to say it—an existential crisis. We all know the reasons: the impact of digital and the voracious appetite of unaccountable, unregulated platforms have put enormous pressure on the revenues of all publishers. Tragically, many titles have closed, particularly in the local press, with thousands of reporters’ jobs lost. The future of many others hangs in the balance, and the analysis put forward by my noble friend Lady Stowell is absolutely spot on. The implications for our democracy are profound.
The situation has been made worse by the decisions of this Parliament; in particular, the data Act, which we have, with some reluctance, just passed. While publishers are fighting hard to remodel their businesses and build new revenues, the exponential growth of AI, unrestrained by effective copyright law, threatens the very future of all news brands, as I have pointed out with perhaps monotonous repetition in this House.
Lord Clement-Jones (LD)
My Lords, I strongly support my noble friend Lord Fox’s fatal amendment. When this House welcomed a complete ban on foreign government ownership at the Third Reading of the Digital Markets, Competition and Consumers Bill last March, the then Government proposed a 5% exemption for passive sovereign wealth fund investment. The noble Baroness, Lady Stowell, and the noble Lords, Lord Forsyth, Lord Robertson and Lord Anderson, deserve huge credit for securing this change, alongside the then Minister, the noble Lord, Lord Parkinson.
Yet in a remarkable about-face, this Labour Government propose allowing foreign state-owned investors to hold up to 15% stakes, tripling the previously proposed threshold. As we have heard, 15% is not trivial. Even a 15% stake can provide extraordinary leverage, board representation, veto powers over key decisions and a very real influence over editorial policy.
The Competition and Markets Authority guidance on mergers’ jurisdiction and procedure makes it clear that there is no exhaustive list of relevant factors. Even one board seat may suffice, depending on circumstances. The regulations currently allow multiple foreign states each to acquire a 15% stake. Nothing would stop a consortium of foreign regimes stacking up a controlling interest in a British newspaper. The Government acknowledged this flaw in their letter of 21 July, admitting, as we have again heard, that this will need correcting in the autumn. But why proceed with these regulations when the Government admit that they are fundamentally flawed? The 15% threshold contrasts starkly with international best practice. Australia sets just 5% for media companies.
There has been some argument today, notably from the noble Lord, Lord Black, that our struggling newspaper industry needs foreign investment. Even the Minister talked about existential threats. But if conventional investors are reluctant, as the noble Lords, Lord Fox and Lord Forsyth, say, foreign state investors clearly seek a different return: influence. Should we mortgage editorial independence when the price is erosion of public trust?
The consultation process was deeply problematic, with only four responses, primarily from newspaper groups seeking foreign investors. This hardly justifies tripling the threshold. The Government claim they can intervene if passive investors become active, but how does one monitor passivity and detect influence? As the Secondary Legislation Scrutiny Committee noted, it is an impossible task to determine nuanced changes indicating influence. In matters of press freedom, we must err on the side of caution.
I see that the noble Lord, Lord Black of Brentwood, came out in yesterday’s Telegraph, and today, with all guns blazing. His attack on the Liberal Democrat position fundamentally mischaracterised what the Press Recognition Panel actually does. The PRP is not a statutory media regulator that controls editorial content. It is an independent body that recognises voluntary press regulators, such as Impress, while IPSO deliberately chooses not to seek recognition to avoid meeting proper independent standards. This system protects press freedom by ensuring that regulatory bodies themselves meet robust standards for independence and effectiveness.
The characterisation of this amendment by the noble Lord, Lord Black, as “onerous statutory controls” is the same misleading tactic used by media proprietors to avoid genuine accountability while maintaining maximum commercial freedom. The position of these Benches is entirely consistent: genuine press freedom requires protection from all forms of external influence, whether political interference, proprietorial control or foreign state investment. Our support for Leveson-compliant independent regulation and opposition to foreign state media investment both serve the same principle: to ensure editorial independence from external pressures.
The stakes could not be higher. As the noble Lord, Lord Black, has mentioned, this legislation is clearly drafted to facilitate deals such as the potential takeover of the Telegraph by RedBird Capital, whose Chinese connections are subject to concern. A 5% cap strikes the right balance, allowing for genuine commercial investment while preventing the accumulation of influence that will strangle press freedom. The British public deserve to know—
Lord Knight of Weymouth (Lab)
As ever, the noble Lord has made a good case. He made his point—as did the noble Lord, Lord Forsyth—around what a percentage stake might mean if the returns are not going to be great. What difference is there between 5% and 15% in respect of the argument he is making about influence? If someone wants to invest 5%, surely they are doing it on the same basis as 15%.
Lord Clement-Jones (LD)
Perhaps the noble Lord has never been on the board of a public limited company. There is a huge difference between a 5% and a 15% ownership stake.
Lord Knight of Weymouth (Lab)
There is a difference, but the argument the noble Lord is making is that people are seeking to get influence rather than a financial return. If you are taking 5%, you are doing so for a financial return. Why would investors not also be looking for a financial return on 15% in just the same way?
Lord Clement-Jones (LD)
If a company has a series of 5% ownership stakes it will have a plurality of shareholders and therefore a mix of influence, but if you own a 15% stake you have a much higher share in the company and are probably entitled to a single board member.
Lord Forsyth of Drumlean (Con)
Is it not that there is a difference between 5% being held by a foreign government and 5% being held by a national wealth fund or something of that kind?
Lord Clement-Jones (LD)
I entirely agree with the noble Lord. I do not understand why the noble Lord, Lord Knight, is raising what seems to be a pretty obvious issue.
The British public deserve to know that their morning newspaper delivers journalism guided by British values and editorial independence, not the preferences of foreign powers.
Briefly on this House’s conventions: the guidance issued in the 2006 report from the Joint Committee on Conventions—which was mentioned by noble friend Lord Fox—is still current, despite the 2015 Strathclyde review. It concluded:
“On the basis of the evidence, we conclude that the House of Lords should not regularly reject Statutory Instruments, but that in exceptional circumstances it may be appropriate for it to do so. This is consistent with past practice, and represents a convention recognised by the opposition parties”.
Subsequently in March 2007, with strong support from the then Archbishop of Canterbury I succeeded with a fatal amendment that prevented a super- casino being located in east Manchester. Since then, in January 2013, the noble Lord, Lord Bach, succeeded in defeating a legal aid order. I welcome what the noble Baroness, Lady Stowell, had to say about the existence of the convention.
Those were exceptional circumstances and so too are today’s. The ownership of our press is a matter of great public policy importance, and we are fully entitled to defeat these regulations. I urge noble Lords to support my noble friend Lord Fox’s fatal amendment. Let us send a clear message that the integrity of the British press is not negotiable: 5% is sufficient, but 15% is a doorway to influence that, once opened, may prove impossible to close. I commend the amendment to the House.
We on these Benches also oppose the draft Enterprise Act 2002 (Amendment of Section 58 Considerations) Order 2025 and the draft Enterprise Act 2002 (Definition of Newspaper) Order 2025, which have been tabled for approval today. These orders propose extending the ambit of the Enterprise Act to encompass digital media and broadening the definition of “news media” to explicitly include online news, websites and broadcasting. If we were at one on the question of media ownership then this would be a welcome extension. However, expansion at this time, while fundamental concerns regarding foreign ownership of traditional newspapers remain unresolved—or, indeed, are potentially being dangerously broadened—is illogical and dangerous, and we will not support these draft orders.
Lord Forsyth of Drumlean (Con)
My Lords, I always pay careful attention to the advice given to me by my Chief Whip. The advice—which I am not sure I am allowed to reveal—is that we should not support this amendment on the grounds that we do not vote for fatal Motions. I was very impressed by the speech by the noble Lord, Lord Fox. In fact, I agreed with every single word. That is a real first for me on something coming from the Liberal Benches.
Until quite recently, I told people that I have never voted for a fatal Motion, but in fact I discovered that I did some six weeks ago, as the noble Lord pointed out. We had a fatal Motion, and quite rightly so, because it was on a matter that we thought was in the national interest: the position of the Government on their treaty on the Chagos Islands. So both I and the noble Baroness, Lady Stowell, have voted for fatal Motions in very recent history, so I am a bit confused by the suggestion that we should deal with this matter on the basis of some kind of procedure. We have heard the nature and seriousness of the arguments. If this House now feels that it cannot vote on a matter of this seriousness because of some mythology about fatal Motions, what is the point of us being here at all? What is our purpose? This is a central issue.
The other reason why I am a little confused is that, when we amended the legislation last year under the previous Government, my noble friend Lord Parkinson mentioned an amendment being made at Third Reading and said:
“We will amend the media merger regime explicitly to rule out newspaper and periodical news magazine mergers involving ownership, influence or control by foreign states”.—[Official Report, 13/3/24; col. 2042.]
I emphasise “foreign states”. He said:
“Direct investment in newspapers of any size will be banned … We will therefore introduce an exemption for investments where the stake is below 5% of the total … This would apply to passive investments by … sovereign wealth funds, pension funds or similar”,
not by foreign states. That was primary legislation passed by this House. There was no vote because there was unanimity across the whole House about the importance of banning foreign Governments from owning parts of newspapers.
There was also consensus across the House for extending that to other media services, which the other instruments refer to. The noble Lord, Lord Clement-Jones, quite rightly points out that they would, I think, be supported by the House were it not for the fact that they change the ownership rules to allow foreign Governments to be involved not just in our newspapers but in other news media organisations.
My noble friend Lord Parkinson also said that the Government recognised the
“risks that foreign state ownership of … the UK’s newspapers and news magazines could pose to democracy and to free speech”,
allowing them to
“over time corrode trust in our media as a whole”.—[Official Report, 26/3/24; cols. 584-85.]
What has changed in the past 12 months about those principles? The Government have changed, but that is not a reason to change one’s principles on this side of the House. This Government have sought to take secondary legislation and use it to change not just the intention but the effect of primary legislation. Now they are the Government—we lost the election.
Viscount Hailsham (Con)
On that point of the use of statutory instruments, does my noble friend agree that many of the problems he has identified arise from the fact that statutory instruments cannot be amended? Is it not bizarre that in the autumn we are going to have a remedial statutory instrument, the terms of which could be incorporated into the present statutory instrument if we were able to amend it?
Lord Forsyth of Drumlean (Con)
As always, my noble friend makes an excellent point, but it takes me slightly off the subject. I am kind of arguing that these procedural arguments are trounced by the fact that what is being done here is that primary legislation is in effect being amended by secondary legislation—to which, as he says, we cannot make an amendment. That is completely wrong. If we allow this to go forward, there will be other examples. This is the Executive thumbing their nose at the Parliament. This is the Executive taking power.
I believe that these regulations abandon an important principle. In her introduction, the Minister deftly avoided and elided the suggestion that investment was needed from foreign Governments. I have no objection to national wealth funds. Indeed, we amended the legislation, and the 5% had nothing to do with foreign Governments. As I recall, it was introduced to allow the Norwegian pension fund to be able to continue its existence. That was an exception to the rule, necessary because of the nature of those funds. Now we have regulations that allow 15% to be held by foreign states; that is what is at stake here.
Notwithstanding the powerful advocacy from my noble friend Lord Black for the Daily Telegraph, this has nothing to do with the Daily Telegraph. This is about a general principle that foreign Governments could take a stake in our newspapers and other media assets. When I say that it is nothing to do with the Daily Telegraph, I am slightly suspicious, just to take my noble friend’s point, that we are being asked to do this at such speed, in such a hurry. It is nothing to do with the Daily Telegraph bid, I am sure. Why did the Government not just withdraw the amendments and table new ones, which we could discuss at length in the autumn? Could it be to do with some other business going on with the Daily Telegraph? I may be cynical, and perhaps I am being unfair, but it feels like that.
I took the liberty of sending to colleagues—I promise not to do it very often—an article written by Fraser Nelson, whom I hold in the highest regard as a political journalist. I have circulated it to a number of colleagues. It tells the inside story from his ringside seat of what has been going on with the purchase of the Daily Telegraph. I commend it to noble Lords because, if they read that article, they will certainly vote for the amendment in the name of the noble Lord, Lord Fox. It is completely unacceptable that our parliamentary procedure should be overwritten and that we should create an open door for foreign Governments to get into our media services to meet a particular bid.
The remarkable thing is that when you ask the Ministers why they are making this change, they say that it is nothing to do with the Daily Telegraph—it is because they had a consultation exercise. As the noble Lord pointed out, they had all of four people responding to this consultation exercise, which made them change their minds. Who were the people who responded to the consultation? They actually said that they were not going to tell us—it was going to be kept secret, because it was so embarrassing to discover that it was the newspaper owners themselves.
Of course, it is always very dangerous to cross newspaper owners, especially if you are in politics, which is why Fraser Nelson is to be commended on his excellent article today. If we have foreign Governments owning newspapers, as opposed to foreign investors, there will be a conflict of interest between our journalists and their proprietors, because our journalists might want to write unpleasant things about some regimes that may or may not be allowed to own the newspapers. For this House, if it is a choice or conflict, which are we going to support, the freedom of the journalists or the financial interests of the proprietors? There can be only one answer: we have to support the freedom of the journalists, even if they do not always reciprocate in respect of this House.
There is one further point I would like to make, and it is about RedBird. I do not have a clue where RedBird’s money is coming from; it is not disclosed. How can we possibly feel comfortable with that? I know that the noble Lord, Lord Alton, who has been so spectacularly successful in arguing in this House for freedom, not just in this country but all over the world, has grave concerns about the relationship between RedBird and the Chinese Government at the highest level. I know nothing about RedBird, and therefore I feel even more despairing that the Government should be bringing forward these regulations, instead of the Secretary of State having by now instituted for the MMC to carry out an inquiry into precisely those matters.
It is with great pride and pleasure that I shall support the Liberal amendment, not because it has been made by the Liberals, although I have huge respect for the noble Lord, Lord Fox, but because I believe that he is speaking for the whole House as it was before the election, when almost unanimously, without a vote, we upheld the principle, which these regulations seek to undermine, that foreign states should not be allowed to own newspaper assets in this country.
Lord Robertson of Port Ellen (Lab)
My Lords, last year I went to the Department for Culture, Media and Sport with the noble Baroness, Lady Stowell, in a small delegation to make representations about the lack of any regulation at that time to prevent foreign Governments buying stakes in British newspapers. In the subsequent debate I certainly supported her view, and I liked very much what she has said today. The consultation may well have produced only four newspaper contingents giving their views, but a lot of other people have given a lot of thought to it in the meantime, as I have.
The question for the House today is whether we accept the compromise of 15%, higher than 5% but lower than the 25% that would have given the statutory controls, or go for a fatal amendment, getting close to what would be regarded as the edges of the constitution. I think that the Government have given a fair account, and I have discussed it and debated it at the same time. I have changed my mind. I think the safeguards that are available and the 15% are reasonable, and I believe we should therefore vote against the fatal amendment.
Lord Alton of Liverpool (CB)
My Lords, I hope to be able to persuade the noble Lord, Lord Robertson, who knows that I have enormous respect for him, that the safeguards are not good enough and that he should reconsider before we get to a vote on this amendment. The noble Lord, Lord Forsyth, at the end of his remarks, commented about Fraser Nelson’s article this morning. It is a long article, but I will just read a sentence from it:
“But the Emiratis and others are using their state investment vehicles as levers of political power”.
That is the democratic threat. It is one that Parliament has protected us from, but that protection is now compromised.
That is why we are here today. None of us speaking in this debate wants eagerly to support a fatal amendment. I, the noble Lord, Lord Forsyth, and others have not supported fatal amendments on any kind of regular basis, but this is an extraordinary set of regulations that we are being asked to approve and these are extraordinary times. I agree with the noble Lords, Lord Forsyth, Lord Fox and Lord Clement-Jones, and others who have expressed opinions outside your Lordships’ Chamber, including the noble Baroness, Lady Kennedy of The Shaws, and the noble Lord, Lord Blencathra, and I have arrived at the same conclusion, albeit reluctantly.
Lord Lansley (Con)
I will make brief points about each of the regulations, not only those relating to newspaper mergers. On that, I very much agree with my noble friend Lady Stowell. We are in the unhappy position of being presented by the Government with regulations that do not adhere to the policy intention. A number of noble Lords made it perfectly clear that the statute prohibits foreign powers having any stake in our newspapers, but it allows the Government to make exceptions. It was clear that the policy intention, outlined by my noble friend Lord Parkinson of Whitley Bay, was to bring in such exceptions by reference to a shareholding of 5% for this purpose.
However, the 15% figure, as the noble Lord, Lord Alton, has just explained, is not the only condition. Schedule 6B presents other conditions that need to be met. Indeed, condition 4 makes it very clear that if there is control or influence over the newspaper that is not related to the shareholding, it can be the basis on which a foreign state influence intervention notice is presented. Although we appear to be debating only the shareholding, it is in fact only one of a number of potential issues, as the noble Lord, Lord Alton, set out.
For my part, I agree with my noble friend Lady Stowell that we cannot vote for the fatal amendment—not for constitutional reasons, but simply because we would arrive at a position where we would not be giving effect to the policy intention because we would not be making any exceptions, even for investments that are not exercising any control or influence. I share my noble friend’s view on this subject.
I turn to the other regulations, which I welcome; I do not object to them, as the noble Lord, Lord Clement- Jones, did. They take the definition of “newspaper” in our public interest media merger regime to where it ought to be; that is, publications that concern news-related material, both in hard copy and online.
However, I put it to the Government—I have discussed it with Ministers; I know that it is for further consideration in future—that because the definition of “newspaper” includes
“news-related material which is subject to editorial control”
and “editorial control”, among other criteria, includes that it should be first published by that publication, it excludes online news aggregators. I will give noble Lords a very simple example. I am sure that many of us use Google News or Apple News—I use the latter—which are news aggregators. I do not think that we should, for a minute, accept that they do not exercise control of our media. They have editorial teams to determine the most important stories that we should see each day. As many here will know, setting the agenda is an essential part of a political process. If we have news aggregators setting the agenda online for millions of people, for whom that source is one of the most trusted online sources, the control of that online news aggregator is an extremely important issue.
News aggregators are currently excluded from our public interest media merger regime because they do not first publish the material that they put online and present to their millions of subscribers. I put it to the Government—I hope that they will take this on board—that the definition should be amended to identify that kind of online news aggregator and include it under the public interest media merger regime.
Lord Shinkwin (Con)
My Lords, I listened carefully to the remarks made, and I thank my noble friend Lord Forsyth of Drumlean and the noble Lord, Lord Fox, for making such a compelling case.
If only this were about the survival of specific newspapers; however, as we have heard so clearly today, it is about the survival of the fundamental freedom of our media from Governments, as Fraser Nelson has argued so persuasively. It is the insidious nature of the threat contained in this statutory instrument that alarms me and that should, I believe, alarm us all. That is why I urge all Members of your Lordships’ House to support this fatal amendment.
Lord Cromwell (CB)
My Lords, two practical things are puzzling me. First, if we swallow the ideas that 15% does not bring influence and that it can be checked, monitored and proved—both of which are quite big mouthfuls to swallow—what action will actually be taken? What penalty will be imposed that will not damage the very publication that we are talking about?
Secondly, we are asked to allow this investment because there is, in essence, an existential threat. That feels to me like a bailout. What will happen if that cash runs out and more is needed? Will there be pressure for, perhaps, a further 5% to be added? Alternatively, will we have another discussion about what an acceptable level of shareholding will be to bail out that newspaper again? I do not have complex conspiracy theories in mind, but that seems an obvious trap. If you give money to a struggling business, it is likely to ask you for more later, which will give you more control.
Lord Udny-Lister (Con)
My Lords, I oppose the Motion from the noble Lord, Lord Fox. In so doing, I have a non-pecuniary declaration I must make: I am the co-chairman of the UAE-UK Business Council, so I am fully aware of the situation there.
The Government’s proposal would allow a minority, non-controlling stake of up to 15%. I cannot see any issue with this, for this is not a majority control nor is it a back-door granting of our press to be editorially censored by foreign state actors. We are simply discussing the ability for our national newspapers to seek investments needed to survive in this interconnected world in which we now operate.
Lord Forsyth of Drumlean (Con)
I do not think any of us are concerned about sovereign wealth funds; we are concerned about Governments. As far as I know, the United States Government do not have any interest—hopefully—in any of the social media organisations the noble Lord is referring to.
Baroness Fleet (Con)
My Lords, it is an honour to follow the noble Lord, Lord Udny-Lister, who is an old friend and old colleague. I declare my interest as former editor of the Evening Standard¸ deputy editor of the Telegraph and the Daily Mail and independent director of Times Newspapers.
As an editor, I met many newspaper proprietors, and I know that the very rich who want to invest in newspapers do so primarily because they want to have influence. I have the highest regard for my noble friends Lady Stowell and Lord Black of Brentwood, and I commend their contributions to this debate.
However, while I know that, sometimes, there is need for pragmatism and compromise at times of political and financial crisis, when it comes to freedom of the press, there can be no compromise. There is a principle to fight for.
Several noble Lords have reminded us that in March last year this House came to the conclusion that foreign states should not own newspapers. State control undermines free speech. We have heard the splendid speech from the noble Lord, Lord Alton, who is one of the great masters of this subject. On that basis, the then Government compromised and agreed that arm’s-length sovereign wealth funds could indeed own a maximum stake of 5%. We are now offered a variation whereby a foreign state can own a maximum of 15% of a newspaper.
However, in the statutory instrument, there is no limit on the number of states that can each own 15%—we have heard the argument. In other words, a coalition of states could each own 15%, thus having a majority ownership and the ability to exercise control. Once the Secretary of State was alerted to this possibility of multiple 15% ownership over six weeks ago, the Government could have been fleet of foot and pushed through a second SI to ensure the spirit of the first SI was not abused. But no, we waited and waited. Only last week was a second SI brought forward closing the loophole—but not immediately or as part of the first SI, but with a possible date in the autumn.
Therefore, the SI has a giant loophole, and this is what we are debating today. Would any savvy business sign a deal with a giant loophole only with a promise to close that loophole sometime in the future? No, of course they would not. Either we want to protect our freedom of speech and freedom from foreign state control, or we do not. That is the principle.
What is the justification to vary the 5% ownership other than that a foreign state wants more control or to save face? We have not been told.
Arguing against the fatal amendment on the grounds that the Telegraph urgently needs the deal to be agreed is an unacceptable compromise. This House is not here to consider transactions. This House is here to consider a point of principle. Will the Telegraph fold if a foreign state is not legally allowed to own 15%? I do not know. None of us knows, but that is not the point. I do not accept that we should rely on the Government’s promise of a second statutory instrument—which we have heard it might actually not even be possible to introduce after the legislation—to close the loophole sometime in the autumn. There is no legal or parliamentary reason why the Government could not have pushed through the second SI by today, so I have grave doubts about this promise.
If we agree to today’s regret amendment, there is in theory and in practice nothing to stop, say, four foreign states buying 15% each, making the Government’s promise for the autumn irrelevant. The Government will say that we can rely on the regulator—the CMA, perhaps, or Ofcom. We have all seen the failure of regulators—just think of the water regulator or the City regulator. When it comes to freedom of the press, only the law protects, not regulators. To protect newspapers from any foreign state influence, I will support the fatal amendment.
Lord Vaux of Harrowden (CB)
I want to ask a very quick question of the Minister. Why 15%? A number of noble Lords have said very clearly that 15% does not give influence, but they are missing a very important legal right that cuts in at 10%. That is because when acquiring a company, if you are able to get 90%, you can compulsorily acquire the remaining 10%—it is called the squeeze-out procedure. For that reason, in any takeover situation, typically you put in a condition that says that you will not acquire the company unless you reach 90% or more. If you hold 10%, you can block a takeover, so why was 15% chosen, not less than 10%?
Baroness Bennett of Manor Castle (GP)
My Lords, very briefly, I offer the Green group’s support for the fatal amendment of the noble Lord, Lord Fox—and I welcome him back.
I will make three brief points, one of which is drawing on my experience. I declare my position as a former editor of the Guardian Weekly newspaper, the international edition of the Guardian. Before I worked for the Guardian, I worked for the Rupert Murdoch-owned Times newspaper, and I was the page 1 sub-editor for a period in the early 2000s. There was a lot of interest at the time in what influence Rupert Murdoch had on what the Times did. That was something of interest to me, and I watched it very closely. There was only one specific case where it was widely known that Rupert Murdoch had explicitly intervened in the Times’ coverage. What I saw regularly, evening after evening, was senior editors agonising, asking: “Would Rupert like this?” or “Would Rupert not like that?” This was the point made by the noble Lord, Lord Clement-Jones, about the provision here whereby the Minister can intervene if they see influence. How are you going to see influence such as that? It is not a visible action—nothing is even said.
My second point is that my support for the fatal amendment is in no way support for our current media ownership arrangements. The Green Party has long worked with the Media Reform Coalition, focusing on the extreme concentration of our media in a handful of right-wing media tycoons. What is being proposed here is not going to improve that situation.
Thirdly, reflecting on what the noble Lord, Lord Alton, said about Chinese influence, I draw the House’s attention to a ruling this morning in the European Court of Human Rights on a case brought by three former MPs, one of whom is former Green MP, Caroline Lucas. They did not win their case over the Brexit referendum in 2016, but the court in Strasbourg did find that there were shortcomings in the UK’s initial responses to allegations of Russian interference in the Brexit referendum campaign. As Caroline Lucas said afterwards:
“It’s hugely significant that the court has found in favour of our case that foreign interference is a threat to our right to free and fair elections”.
I would add that it is a threat to free and fair democratic debate.
Baroness Wheatcroft (CB)
My Lords, I will be brief. I am sure that noble Lords feel that they have heard enough from newspaper editors already. As another former newspaper editor, I was going to sit quietly, but I must take issue with the comment from the noble Baroness opposite that Rupert Murdoch was always an unseen influence on what senior editors wrote. As a former senior editor there who disagreed vehemently with Rupert Murdoch over very many things, I can say that that was not at all a consideration in what we wrote. I have no doubt that he told those at the Sun every evening what to write, and that they wrote it. It shows that newspapers are influenced by their proprietors if they wish to be, and if their audience is happy with that.
Listening to this debate, we seem to have lost the idea of what has happened to newspaper audiences. They are no longer what they were. The noble Lord, Lord Clement-Jones, talks about people having their newspapers delivered to their homes and those newspapers upholding British values. Maybe he has been reading the Daily Telegraph recently, but my reading of the Daily Telegraph is that it does not tally with my British values, and it may not tally with the British values of everybody here.
Newspapers have a role. It is no longer the role that it used to be. They are fulfilling it to the best of their ability, but competing with numerous other sources and not always succeeding. As others have mentioned, the web in various guises, particularly social media, provides the news for the majority of young people in this country. I contend that that is far more dangerous than any influence on a major national newspaper. If some major national newspapers were to influence the debate at all in this country, I do not think that Keir Starmer would be the Prime Minister today—it could still be Liz Truss. Newspapers do not have that much influence any more.
However, there is no doubt that the procedure that has brought us to this position has been flawed. I think the Minister accepts that the Government have not made the best job of this. If she can give the House some indication that the potential loophole between now and the autumn will be fully bridged, then we should support the amendment tabled by the noble Baroness, Lady Stowell, because there is sufficient regret over how this has been done. We should not pass a fatal amendment that looks to a history that no longer exists.
Baroness Fox of Buckley (Non-Afl)
My Lords, this is not a media studies debate on proprietors and their influence over the press. This is about state ownership, which is what we voted on. It is not about whether Rupert Murdoch has an undue influence. The noble Lord, Lord Robertson of Port Ellen, explained the process through which he concluded that he had changed his mind, but he has not changed anyone else’s—nobody even asked whether we had changed our minds.
This is about subverting the primary law, that we all voted on, behind our backs. A decision that we made has deliberately been reversed. Everybody might have changed their minds, but that is not the point. If you are thinking about the constitution, it must be brought back as a debate. If it was not for the amendments, we would not be having this debate.
The final thing is the context. Everyone who has spoken has stood up and said, “We believe in press freedom”. In this country, press freedom is ultimate: each party declares that it is for press freedom. I will remind noble Lords of the context. I am still in shock at the revelations about the super super-injunction brought out by leading members of both parties—or brought out by one party and then supported by the other—that has completely slapped press freedom across the face in relation to the Afghan leak. The reason I mention that is that when people say, “Can you just trust us? We all believe in press freedom—this is not going to undermine press freedom”, press freedom is already under pressure. We have seen that, behind the scenes, the press can be denied the right to information that they should have had in relation to that Afghan scandal.
As far as I am concerned, in this instance I will be supporting the fatal amendment put forward by the noble Lord, Lord Fox, not necessarily for all the reasons that have been indicated by all the speakers from the Liberal Democrat Benches, but because we have to show that press freedom and parliamentary procedures cannot be subverted behind our backs.
Lord Inglewood (CB)
My Lords, I have been listening quietly to the debate, and I think I am the first person to rise who has actually chaired a newspaper company, albeit a small regional company, in this country.
It is my view that, where someone has 15% control, they have a presence in the boardroom; it depends on other circumstances exactly how that presence may work out. But nobody, with the possible exception of the noble Lord, Lord Lansley, has really addressed what is a very serious point, which is that people who own things—and everything has to be owned by somebody —can change their minds. There is an underlying assumption behind much of what we have heard this afternoon, that if you are a foreign state, you can say, “I won’t use my ownership to exercise influence”, or you might be one that thinks, “I want to promote my own country in the receiving country”.
Of course, the problem we face is that the investment market for media is international and most media, particularly some of the papers we have been discussing this afternoon, are essentially nationally focused. There is a disjunction between the regulatory regime and the realities of the capital markets that lie behind a lot of these projects. All I would say is that it behoves us to be very cautious. As the Queen said before the Scottish referendum, “Be careful”.
Lord Newby (LD)
My Lords, I never in my wildest dreams thought my last speech as leader of the Liberal Democrats in your Lordships’ House would be to express my concern about the future of the Daily Telegraph. Politics is a funny business.
The arguments that we have been hearing this afternoon fall under two broad headings: the substance and the procedure. On the substance, there is no need to rehearse the argument about why foreign influence on our media is thought to be a bad thing. There is agreement about that. The logical way in which we stop there being foreign influence is to make sure that there is no foreign ownership. But we have heard this afternoon, first from the Government and then from others, that it is better to have some foreign ownership than for the press to face an existential threat.
This argument, one would have thought, was not entirely new. Yet, when the digital markets Bill was being debated in your Lordships’ House, amazingly, our media did not face an existential threat—nobody argued that. So, in the course of a year, we have gone from a point where a 5% stake by a non-state foreign actor was thought to be acceptable to where we now find that our newspapers face an existential threat unless foreign Governments are allowed to own 15%. As the noble Lord, Lord Cromwell, asked—although he did not put it quite like this—if the stake has gone from 0% to 15% in a year, where are we going to be next year, given that we are told that the traditional media are on a slippery slope? I find that a very curious and uncompelling argument.
The question, though, is whether to accept the assurance that a 15% foreign-government stake will not influence or be allowed to influence the editorial stance of a newspaper. The first argument is that this 15% stake is merely passive: you are buying 15% in a newspaper in the same way that you might buy 15% in an oil company or conglomerate. However, given that we are told equally by the same people that these newspapers are facing an existential threat, is it likely that a hard-headed Government will decide that the best use of their funds is to buy a newspaper or part of a newspaper on a passive basis? Having looked all around the world, is that the best return that they will find for their funds? The answer is palpably “No, it is not”.
The next argument in defence of what is proposed is that there is a backstop and that the DCMS will be able to intervene when there is undue influence. However, as the Minister said only last week that, in those circumstances,
“it is likely she”—
the Secretary of State—
“could intervene”.—[Official Report, 16/7/25; col. 1827.]
I emphasise “likely” and “could”.
Suppose that the influence was being exercised in a manner to which the Government were sympathetic; would a Secretary of State intervene in those circumstances? If they did not, what pressure from whom would cause a Secretary of State to intervene? We know that influence over the way a paper presents itself is a subtle thing. In circumstances where you have a Government who are sympathetic to that influence, my contention is that those exercising the influence would get away with it. They amount to the substantial arguments against the proposition before us.
The question about procedure relates to how this has been undertaken. There was a consultation to which there were four responses. Normally, if a consultation receives four responses, you start again, because clearly more than four entities have a view. But, blow me, the four entities all have a similar and partial view, because they potentially stand to gain from this change, and the Government accept that as a reason to change their mind. This is extraordinary to me. I can think of no other consultation where four entities peddling their own argument would get a Government to change their mind. This is an extraordinary consultation, if we can think of it as consultation at all.
The next thing, as has been pointed out, is that this SI is amending primary legislation. I think everybody agrees that this question of press freedom is quite important, so what happened when this SI was debated in the House of Commons? Did they spend this sort of time on it? Did they have impassioned argument with people changing their mind? They spent 18 minutes on it, the vast bulk of which was the Minister at the start and the end. There were literally a couple of speakers in the entire debate. Either the House of Commons is not interested in the issue or it did not realise what was going on, because it is an SI and, as we know, MPs regard being put on an SI committee as a bit like being sent to Siberia for a month. So, in reality, this issue has not been debated at all in the House of Commons, which is extraordinary. If most MPs had realised what they had agreed to, without actually agreeing to it themselves, they would have opposed it.
The whole thing seems to be potentially very damaging and shows parliamentary scrutiny to be non-existent, except in your Lordships’ House in this case. For it to proceed would be bad for freedom of the press and for the way we deal with these things. When, on 3 June, the noble Earl, Lord Minto, urged people to vote for a fatal Motion on the Chagos Islands, he said that it was his
“duty to bring this fatal Motion to the House”.—[Official Report, 3/6/25; col. 614.]
We think that it is our duty to bring this fatal amendment to the House, and we urge noble Lords to support it.
Lord Parkinson of Whitley Bay (Con)
My Lords, it feels like a long time since I stood at the Dispatch Box opposite, taking part in similar debates on what became the Media Act 2024 and the Digital Markets, Competition and Consumers Act 2024, but I have been genuinely heartened to know, from the contributions from across the House today, that the concerns raised in the passage of those Acts remain strongly at the forefront of noble Lords’ minds. As I said then, and as noble Lords have rightly said today, our free and independent press in this country is an absolute cornerstone of our democracy and a vital part of public discourse. It is right that we should devote so much time to making sure that it remains healthy, robust and independent.
Like other noble Lords, I am very glad to see the noble Lord, Lord Fox, back in his place and on fighting form. I wish the noble Lord, Lord Newby, well in his retirement as he vacates the leadership of his Benches. There is a slightly unfair characterisation of the Daily Telegraph as having a letters page that attracts contributions from the retired, fulminating against things. I look forward to the noble Lord’s green-ink letters. I wish him a happy retirement and thank him for his many contributions. I particularly enjoyed the closing words of his speech, which seemed to me to make the case against elected Houses and in favour of the power and independence of appointed ones. I shall leave that for further debates.
I start with what some have called the constitutional position, because it is important that we understand the unusual amendment that is before us. It is within the rights of your Lordships’ House to table, divide on and even, if it wishes, on rare occasion, to support fatal Motions, but those are serious steps, and the last of them, in particular, should be taken very sparingly and in exceptional circumstances. I am not convinced that the circumstances here warrant an action of that gravity.
I say that as somebody who has some skin in the game here. As noble Lords have reminded the House, I was in the position of outlining the beginning of the policy that the Minister is continuing today. I find myself in the position of seeing the Minister tearing up the words I uttered at that Dispatch Box, or at least signalling an intent to depart from them. She is entitled to do that because, shortly after I made those comments, there was a general election that ushered my party from power and brought hers in with a landslide result. She has been admirably candid about that. I tried to scribble down what she said in her opening remarks: “This Government have come to a different conclusion to the previous Government about the appropriate threshold”. They are entitled to do that, and your Lordships’ House is, of course, entitled to probe how and why they have reached that conclusion.
However, the new Government cannot ignore what Parliament has agreed to put on the statute book, unless they convince us to change the law. The last Conservative Government, I am proud to say, strengthened the powers available to Governments and to Parliament to protect this country and key sectors of our economy and society against malign foreign interference. We passed the National Security and Investment Act in 2021, the National Security Act in 2023, and, in our final weeks in power, following campaigning by noble Lords, particularly my noble friends Lady Stowell of Beeston and Lord Forsyth of Drumlean, amendments to the Enterprise Act regime, delivered through Schedule 7 to the digital markets Act. I pay tribute to my noble friends and all the other noble Lords, including the noble Lords, Lord Robertson of Port Ellen and Lord Anderson of Ipswich, who persuaded us to do that.
I am also grateful to my noble friend Lord Lansley for pointing out the other statutory provisions that are on the statute book compelling the Secretary of State to take action to protect our independent and free media. This is not just a debate about the difference between a 5% and a 15% shareholding threshold, important though that is for us to explore—as we have done. The question is, is the will of Parliament being ignored here? The change that I had the privilege of making to the statute book towards the end of the previous Parliament was delivered at Third Reading of a Bill after much debate. It was done in great sincerity, but also in the recognition that further work needed to be carried out and that secondary legislation would be brought before your Lordships’ House to implement it.
Baroness Twycross (Lab)
I thank all noble Lords who have participated for their contributions. In particular, I thank the noble Lord, Lord Parkinson, for his closing remarks and for his graciousness and support. I have appreciated the conversations we have had. Like him, I pay tribute to the noble Lord, Lord Newby. I know this is the noble Lord’s last speech as leader of the Liberal Democrat group, but his incredible contribution to your Lordships’ House will continue.
I am going to start, perhaps unusually, by accepting the criticism from the noble Baroness, Lady Stowell of Beeston, which was echoed by others, including the noble Lord, Lord Parkinson, about how long it has taken us to bring this matter before your Lordships’ House. I think it was right to consider the matter carefully, but I appreciate that the criticism is fair. We have the chance to enact this now, however, and I believe your Lordships should support the Government’s effort to act on this point. There is, no doubt, disagreement on how we achieve our aim, but the underlying theme throughout this debate has been the fundamental importance that noble Lords attach to media freedom and the sustainability of our free press. I know this is key to all noble Lords’ responses to this matter. We need to make sure that our news media has a vibrant future and not just a proud past that we can look at in the bookcases outside the House of Lords Library. It is essential to our democracy.
As many noble Lords will be aware, the media public interest regime we have now came from the work by my noble friend Lord Puttnam, now retired from this place, and other noble Lords in 2003 to persuade the then Government that there needed to be an effective public interest regime covering cross-media mergers. It is that regime that we are strengthening today.
I am slightly surprised that noble Lords appear to think that it is inappropriate for the Government to take on board the views of newspapers or the views of those such as the noble Baronesses, Lady Boycott and Lady Wheatcroft, or the noble Lord, Lord Black, who have huge track records in journalism; we take their positions and points seriously. I appreciate, however, that the noble Baroness, Lady Fleet, has taken a different view; I respect that as well.
At the heart of the debate today are the three statutory instruments before us, which, taken together, represent the most significant resetting of the media mergers regime since the Communications Act 2003. The regulations will broaden the scope of our media merger regimes, strengthen the public interest protections and, crucially, bring into effect a strong and practical regime to regulate against undue foreign state influence in UK newspapers.
The noble Baroness, Lady Stowell, and the noble Lord, Lord Alton, made specific reference to the Telegraph sale and foreign influence in that regard. The Government are committed to seeing the Telegraph thrive and want to see a sale that aligns with public interest considerations and the FSI regime. Thorough due diligence will be conducted on any advance bid to purchase the Telegraph. Should the Secretary of State have reasonable grounds to suspect that either the public interest or foreign state regimes are engaged, she would intervene.
The noble Lord, Lord Clement-Jones, suggested that legislation is designed to facilitate RedBird’s ambition. The legislation banning foreign state control or influence over UK newspapers seeks to preserve the freedom of the press. This is not about any particular country. Just as the press is independent from the UK state, we do not want any foreign state owning or influencing our newspapers or news magazines.
The noble Lord, Lord Alton, also raised concerns about China and set out his views about the transactions. I cannot comment on the circumstances of any particular case. That is for the Secretary of State. It is why I was not able to provide the noble Lord, Lord Alton, with answers to the specific questions that he asked about a quasi-judicial matter before the Secretary of State.
The suggestions made contradict the clear steer given by the House during previous Oral Questions that this is an important matter and that the Government should put the exception in place at the earliest opportunity. Without exceptions in place, there cannot be investment from any investment organisation with any foreign sovereign wealth shareholding.
A large number of points have been made during the debate. I will briefly address those made specifically on the slightly less controversial regulations regarding expansion of the media mergers regime and online news. These did not get a huge amount of coverage but are, in our view, very significant.
The noble Lord, Lord Lansley, raised the exclusion of online intermediaries. At present, the Government are focusing on the reforms to the media ownership rules suggested in Ofcom’s 2021 review, which did not recommend that online intermediaries, including social media platforms such as Facebook or X, should fall within the scope of this regime. At this point, it is important to note that Secretary of State does have powers to intervene. However, if an online intermediary buys a media enterprise, the Secretary of State does not have powers to intervene if it is an online intermediary that is being bought; so that is a distinction. Ofcom has to date not recommended that online intermediaries be brought into scope of the media mergers regime but continues to keep it under consideration. We will continue to monitor developments and respond to recommendations from Ofcom and others in this area. I think the noble Lord is correct in relation to where people are increasingly getting their news from.
The noble Baroness, Lady Fleet, and others asked why the new SI for multiple states is being introduced. Our policy intention has always been to prevent any foreign state influence over the affairs, activities and policies of UK newspapers and news periodicals. In theory, these could all be passive investors with no ability, at least on paper, to influence a newspaper’s policy but they could still collectively own the majority of the enterprise. Although the provisions prevent states acting in concert to secure control, the new SI will put matters beyond doubt.
The second draft SI also proposes a new requirement for direct state-owned investor investments of more than 5% to be notified to the Secretary of State as a condition of the exception. If the notification is not made, or is made late, the investment will be prohibited.
I will cover a number of other points made about the foreign state influence exception regulations now, as well as the fatal amendment in the name—
Baroness Stowell of Beeston (Con)
If the Minister is going to come back to it, I will happily sit down, but I asked her a question about those new notification requirements in the draft regulations yet to be made, and whether the Government would consider my recommendation that the Secretary of State be required to notify Parliament on a twice-yearly basis if she receives any such notifications, and about the actions that she has taken as a result. Is she able to give me a response to that?
Baroness Twycross (Lab)
That is not in my speech, but I have an answer for the noble Baroness. We think that it is a reasonable suggestion. We need to work out how we can do that. There was a suggestion, for example, that it might require primary legislation. Obviously, that feels a little bit heavy-handed in terms of where we would want to get to. If the noble Baroness is content, I will come back to that. We think that it is a good point and it is worth doing, but I am not able to commit until we have clearer legal advice on how we could achieve that.
Going back to the other points, we have listened carefully to the concerns raised by noble Lords. I thank many noble Lords for the time that they have taken to meet me and the Secretary of State as well as officials. On the new regulations that we put out for consultation on 16 July, we have committed to change the legislation to eliminate entirely the risk that was identified by the noble Baroness, Lady Stowell, and others, and to backdate this change to 13 March last year, which is the date on which the foreign state influence regime came into effect. I give noble Lords an absolute commitment that we will lay regulations in the autumn. I am not allowed to say that we will do it by the end of October; I am allowed to say that we will aim to do so by the end of October.
Some noble Lords queried the difference between sovereign wealth and government control. I want to be explicitly clear: for the avoidance of doubt, this is not state ownership. It is not about Governments owning or influencing our media. We do not want that to happen either. The term “state-owned investors” refers to a narrow group of organisations that will need to be different and distinct from the Government who sponsor them. Foreign Governments will not be allowed to hold a direct stake. Key is the requirement that they make or manage investments, including international investments, as their principal activity. I agree with the point made by the noble Lord, Lord Udny-Lister, that this is not necessarily about influence. I give way—
Lord Forsyth of Drumlean (Con)
The Minister has just made an absolute commitment that “Foreign Governments will not be allowed”. That is what I understood her to say, so why does she not incorporate that in the regulations?
Baroness Twycross (Lab)
My understanding is that that is what the regulations would mean in effect. The noble Lord shakes his head, but I want to be explicitly clear that this is not going to allow foreign Governments to buy newspapers. This is about state-owned investors, which, as I made clear in my opening remarks, is a different matter.
Lord Forsyth of Drumlean (Con)
If that is what she thinks the regulations already say, she will not have a problem with making it explicit.
Baroness Twycross (Lab)
We have the regulations before us. I cannot be more explicit than I have already been.
To continue, investment by single or multiple state-owned investors will be capped at 15%. The regulations that we aim to bring in by the end of October will require a state-owned investor taking a direct holding of shares or voting rights of more than 5% to notify the Secretary of State of the transaction. This will enable her to quickly review any cases where there are suspicions that the shareholding may be more than a passive investment and to refer appropriate cases to the CMA for advice on whether a foreign state merger situation has emerged. This will be a condition of the state-owned investor exception. A failure to make this notification or making it late will mean that the investment in question is prohibited.
The noble Lord, Lord Fox, asked about the redactions in the consultation responses and why they were not published earlier. I have already outlined my acceptance of the criticism from the noble Baroness, Lady Stowell. DCMS has now published the responses. One organisation asked for its views not to be attributed and for some information to be redacted on the grounds of commercial confidentiality. The original consultation by the previous Government specified that responses would not be published and respondents would not be named. This Government’s current consultation makes it clear that they will be.
The noble Lord, Lord Newby, asked about the Secretary of State’s role. The legislation requires that the Secretary of State must refer a merger to the CMA if she suspects a state-owned investor is not entitled to the exception or is not complying with this requirement. This should provide protection in the interim, and was why we did not think the original SI defective. The one in draft was published in response to concerns, not, in our view, to correct an error, although it puts everything beyond reasonable doubt and was a reasonable request.
The noble Lord, Lord Fox, asked about the protections we have against hostile states trying to acquire influence or control. The FSI regime strengthens the Secretary of State’s powers and sits alongside her powers to intervene in a relevant merger situation on the basis of public interest concerns. These powers can be applicable in acquisitions involving state-owned investors within the threshold set by the draft regulation. Taken together, the existing legislation, draft regulations and second statutory instrument would allow the Government to act to guard against the kind of malign interference with UK democracy and press freedom about which noble Lords are concerned.
Additionally, the National Security and Investment Act 2021 can enable the Government to call in and, if necessary and proportionate, block, unwind or impose conditions on acquisitions of control over UK newspapers, including acquisitions that may give rise to national security concerns.
Lord Fox (LD)
I thank the noble Baroness for giving way. As I recall from debates on that Bill, there was a huge annexe that listed all the things within the remit of the National Security and Investment Act, but I did not notice newspapers. Will the Government be bringing forward an amendment to that Act to include newspapers, as she has just suggested?
Baroness Twycross (Lab)
My understanding is that they already can, on the basis of the Act. I do not have the detail that the noble Lord has asked for, but I have been told definitively that that is an existing power within that Act. I can only commit to write to the noble Lord explaining where in the Act that comes.
The noble Lord, Lord Clement-Jones, suggested—the previous Government put this out for consultation—that the FSI threshold should be lower. We believe that the 15% cap we have arrived at is a more straightforward approach than the one consulted on. It strikes a careful balance, enabling newspapers and news magazines to receive investment from a wide range of sources, while ensuring that foreign states are not able to acquire control or influence over editorial and other decision-making through that investment.
The noble Lord, Lord Clement-Jones, asked how things could be truly passive. The legislation would not permit state-owned investors to acquire rights to directly or indirectly appoint or remove directors or other officers of the company. Nor would it permit a state-owned investor acting on behalf of a foreign power to hold the right or ability to direct, control or influence, to any extent, the policy or activities of UK newspapers. Interference in a newspaper’s editorial policy or personnel decisions about senior staff or feature writers is not permitted. Even if a state-owned investor has 15% of the voting rights, it cannot actively use those voting rights in a way that influences the company’s policy or activities, such as editorial direction. The investment must be truly passive to be permitted.
The noble Lord, Lord Newby, asked about the limited use of FSI. It is important to remember that this regime sits alongside the existing media public regime. This works in parallel so that the Secretary of State, as well as having to refer any case with reasonable grounds, can look at whether the transaction raises wider public interest concerns.
I repeat that it is important to give UK media and potential investors greater certainty about the overall regime. I appreciate that it has taken quite a long time to get here. Newspapers have been calling for this, and it will help end uncertainty and support the overall sustainability of the UK newspaper industry at a time when accurate news and public-interest journalism are more important than ever. I do not think it an exaggeration to say that there is an existential problem; I agree with the noble Lord, Lord Black of Brentwood, when he says that, effectively, it is five minutes to midnight.
The power to make exceptions is included in the Enterprise Act 2002, following the amendments made in the Digital Markets, Competition and Consumers Act 2024. We looked at the issue of thresholds and came to a different conclusion from the previous Government. It is different, but arguably not radically different, given that their upper limit for diversified businesses was 10%. I know that is arguable, and I am not sure I will convince all noble Lords. I have, however, set out our arguments as to why we settled on 15% and why—in my view, reasonably—we gave weight to the views of UK newspaper groups, which are directly affected by the FSI regime.
The issue of the exception threshold was left open by the general election last year. It is both right and responsible for the Government to look at this afresh; indeed, I am sure we would have been criticised by some noble Lords had we simply ignored the consultation. Our intention in coming to a final view on the 15% threshold is to balance the need to protect press freedom from foreign state influence with not setting the threshold so tightly that it deters investment in newspapers.
The ongoing dialogue with noble Lords has demonstrated commitment across all parts of the House to guarding against malign influence on UK democracy and press freedom, an aim this Government share. However, while it is entirely appropriate for the House to discuss the fatal amendment today and to raise the concerns noble Lords have expressed, there is a strong convention against exercising the power to annul. We feel that, when we were in opposition, we respected this.
Noble Lords will not be surprised that I agree with the noble Lord, Lord Lansley, and the noble Baroness, Lady Stowell, that it is also the wrong thing to do in terms of policy. We have listened and we have agreed to make changes to put the issues noble Lords have raised beyond doubt. Above all, we will have a robust, effective and operable regime that limits foreign state involvement in UK newspapers while providing the sector with the certainty it needs as it plans for the future.
Lord Fox (LD)
My Lords, I thank those noble Lords who made kind comments. It is good to be back and to participate in such an important and serious debate.
Just when I thought I was beginning to get to grips with what the Government are intending, the Minister introduced a whole new layer of ambiguity that is completely opaque. What is and is not permitted is not clear. Reading the SI and listening to the Minister, they are at odds, and this underlines why we should not be approving this measure.
This has thrown up many procedural arguments, which the Government confess to, and worrying aspects regarding the outcome of this measure. These problems and worries render a regret amendment, in my view, inadequate. That is why I wish to test the opinion of the House.
Baroness Stowell of Beeston
At end to insert “but that this House regrets that the draft Regulations do not distinguish between state investment funds that are directly or indirectly controlled by a foreign power; that the Secretary of State must be relied upon to intervene if a state investment fund does not act in accordance with the Regulations; and calls upon the Government to withdraw the draft Regulations and replace them before 15 September with Regulations which cap foreign state investment to a total of 15 per cent of the ownership of any newspaper, as opposed to 15 per cent per foreign power.”
Baroness Stowell of Beeston (Con)
My Lords, I do not have an awful lot to add to what I said during the debate. I think I covered all the important points. As I said, I have accepted that an aggregate cap of 15% for state-owned investment funds is necessary to ensure the financial viability of the news industry, but with some safeguards. I am grateful to the Minister for her gracious acceptance of the criticisms that I and others have levelled about the Government’s handling of this. It was good of her to do that, and I appreciate it.
I take the Minister at her word about bringing back the supplementary regulations to deal with the loophole. I am disappointed that she is unable to give us a guarantee that it will be before the end of October, but I hear that she says that that is the Government’s intention. As I say that back to the Front Bench, I am looking at the business managers there: the Government Chief Whip and the Leader of the House. They will know from listening to this debate—although I know they were not in the Chamber—the strength of feeling among all noble Lords that the loophole that currently exists in these regulations must be closed.
The Minister acknowledged my requirement that the new notification requirements that will be reflected in the supplementary regulations should also include a requirement on the Secretary of State to report to Parliament. I know that she was not able to give me a guarantee that they will be reflected in the regulations, but I hope very much that they can be. I find it surprising that the Government think that might require primary legislation—I am a bit baffled by that—but I am grateful for her commitment to explore that requirement. I hope that, between now and the Government laying those regulations, we can discuss that further and get it properly nailed down.
I will not detain the House any further by pushing this regret amendment to a Division, because the noble Lord, Lord Fox, has already made it clear that the Liberal Democrats would not feel it necessary to support it—even though they have been so roundly defeated—but I am grateful to all noble Lords who spoke. Some important speeches were made, even those by colleagues who supported the fatal amendment. I think we all recognise that, as I said earlier, this is a very important matter. If there is one thing we all share, it is our commitment to a free press. Today is about ensuring that it can survive.
Enterprise Act 2002 (Amendment of Section 58 Considerations) Order 2025
(1 day, 6 hours ago)
Lords ChamberRead Hansard Text Read Debate Ministerial Extracts
Baroness Twycross
That the Order laid before the House on 26 June be approved.
Relevant document: 31st Report from the Secondary Legislation Scrutiny Committee
Enterprise Act 2002 (Definition of Newspaper) Order 2025
(1 day, 6 hours ago)
Lords ChamberRead Hansard Text Read Debate Ministerial Extracts
Baroness Twycross
That the draft Order laid before the House on 26 June be approved.
Relevant document: 31st Report from the Secondary Legislation Scrutiny Committee
Universal Credit Bill
(1 day, 6 hours ago)
Lords ChamberRead Hansard Text Watch Debate Read Debate Ministerial Extracts
21:03 - Division on Baroness Bennett of Manor Castle’s amendment - Ayes: 17 / Noes: 120 - Baroness Bennett of Manor Castle’s amendment disagreed.
Baroness Sherlock
That the Bill be now read a second time.
Northern Ireland legislative consent sought.
The Minister of State, Department for Work and Pensions (Baroness Sherlock) (Lab)
My Lords, on top of the usual joys of a debate such as this, we are blessed today by the unusual combination of a maiden and a valedictory. I look forward very much to the maiden speech of the noble Baroness, Lady Shawcross-Wolfson, but I am very much touched with sadness that we will hear the valedictory speech of my noble friend Lady Bryan of Partick. This is an important debate for such important occasions.
This Universal Credit Bill forms part of the Government’s reforms to our social security system. Our welfare state sits alongside the NHS as a key pillar of our society. Both represent the principle that, when our people need help, they should get it. This Government’s commitment to both these pillars is absolute, but that commitment cannot mean, in either case, that reform is never possible.
I do not think that many noble Lords would disagree that some reform is needed. We have a lower rate of employment today than we had before the pandemic, and progress in closing the disability employment gap has stalled. One in eight of all our young people is not in education, employment or training. Some 2.8 million people are now out of work for long-term sickness. The number of people claiming health-related benefits with no requirement to work has increased since 2019-20 by 800,000—that is 45%. This is not just about worsening health. Claims for these benefits have been rising far faster than the overall prevalence of self-declared health conditions. So things have to change.
One problem is the structure of our current system. At present, everyone presenting for out-of-work support is put in one of two categories: they are classed as “can work” or “can’t work”. Having created this divide, the system reinforces it financially. Someone labelled as “can work” is expected and supported to find a job, and given £92 a week to live on in the meantime—less if they are aged under 25. Someone classed as “can’t work” is given more than twice as much money but little or no help to take any steps towards work.
This is an unhelpful binary when we know there are hundreds of thousands of people claiming health and disability benefits who are ready for work now, if the right job or support were available. The system is failing them and failing taxpayers. This Bill addresses the problem by rebalancing universal credit, while protecting those we do not ever expect to work from reassessment. We will underpin this by investing record amounts in employment support for sick and disabled people.
These changes are based on three rules: if you can work, you should; if you need help to get into work, the Government should give it to you; and if you cannot work, you should be supported to live with dignity. Crucially, this Bill is part of a wider package of reforms that includes that record investment in employment support for sick and disabled people, totalling £3.8 billion over this Parliament. We have published draft regulations on our right to try guarantee, so that work, in and of itself, will never lead to a benefits reassessment, to give people the confidence to try out work. We are delivering the biggest reforms to employment support in a generation, overhauling jobcentres to create a new jobs and careers service, delivering our youth guarantee, and joining up work, health and skills support at a local level. This is on top of investing billions in the NHS and moving to create more good jobs across the country, plus reforming Access to Work so it is fit for the future and working with businesses on the role that they can play in creating healthy, inclusive workplaces. We want everyone who could work to have that opportunity, not least because work is the best route out of poverty.
I am aware that the amendment tabled by the noble Baroness, Lady Bennett of Manor Castle, refers to the impacts of the Bill. I look forward to hearing her contribution, and I will try to address her concerns in my closing speech. However, it is worth noting here that, after the recent changes, we estimate that the package of benefits changes announced at the Spring Statement, revised to account for the changes to the Bill, will lift 50,000 people out of poverty in 2029-30, something that I hope the whole House will welcome. These estimates do not include any impact that our record investment in employment support for sick and disabled people may have on poverty levels.
I turn to the specific measures in this Bill. Previous freezes to the universal credit standard allowance, and below-inflation increases, have built disincentives to work into the system. The Bill starts to address this by rebalancing payments in universal credit, including through the first ever sustained, above-inflation rise to the standard allowance, which the Bill introduces through Clause 1. This will be the largest permanent real-terms increase in the headline rate of an out of work benefit in decades. It will mean that a single person aged 25 or over will receive an income boost worth around £725 a year by 2029-30. This is balanced by a reduction in the health top-up of universal credit for most new claims, with the new rate set out in Clause 2. This clause, together with Schedule 1, also sets out to whom this lower rate will and will not apply.
Existing claimants, as well as those with severe, lifelong conditions whom we never expect to be able to work, and those nearing the end of life, will continue to receive the current, higher rate of top-up. For these groups, we will ensure, through the calculation in Clause 4, that the combined rate of their standard allowance and their health top-up in any tax year will rise at least in line with inflation between 2026-27 and 2029-30. That means that the income from these benefits will be protected, in real terms, for every year of this Parliament. Clause 3 makes it possible to offer this protection and to freeze the new lower health top-up rate by removing the relevant rates from the Secretary of State’s uprating review.
Clause 5 of the Bill mirrors the changes that we are making in universal credit through Clauses 1 to 4 in employment support allowance, while Clause 6, along with Schedule 2, makes the corresponding provisions for Northern Ireland. We believe that these changes strike the right and fair balance. They allow us to build a more proactive, pro-work system for the future, giving people the right incentives and support to build a better life. They also protect existing claimants who are already familiar with a certain level of support and who might find it particularly difficult to readjust if that were to change. They protect the most vulnerable, regardless of whether they are already claiming the top-up or will do in the years to come. We will always protect the most vulnerable, which is why Schedule 1 will ensure that people with severe, lifelong health conditions will never be reassessed, preventing unnecessary anxiety and giving them the dignity and security they deserve.
As I have said before, welfare reform is not easy and it never has been, but it is really important that we get it right. That is why we always said that we would listen to disabled people, their organisations and others as we deliver our reforms. The House will be well aware that this Bill originally set out to reform the personal independence payment, PIP, as well as universal credit. However, having listened carefully to a full range of opinions in the Commons and beyond, the Government have removed from the Bill the clauses relating to PIP. We will now look at PIP in the round, within the wider Timms review. We have already published the terms of reference for this review, and we expect it to conclude by autumn next year. It will be led by my honourable friend Sir Stephen Timms, my fellow Minister, and will be co-produced with disabled people and other stakeholders as we work to make PIP fit and fair for the future.
This Bill is an important part of our wider reforms to give disabled people and people with health conditions the same rights, chances and choices to work as everybody else. It rebalances universal credit to remove work disincentives, and it gives existing claimants the security and certainty they need, while providing new protections against unnecessary benefit reassessments for the most vulnerable. There is more work to be done, and much of that is already under way, but this Bill, to become the Universal Credit Act 2025, will take us another significant step closer to fulfilling our vision of giving everybody who can work a pathway to work. I beg to move.
Viscount Younger of Leckie (Con)
My Lords, I thank the Minister for outlining the details of the Bill with her usual clarity. It is regrettable that we have only a Second Reading of this Bill, with no further stages, as there is so much up for debate and so much progress which it is imperative to make, and which is simply now not being made, in the important area of welfare and on health and disability-related benefits. The Minister has given the House what sounds on the surface like a considered approach to the strategy on welfare, but the House will not be fooled. The truth is that this is a case of much fiddling while Rome burns.
I start by presenting the economic context with the facts. We are on course to spend £1 in every £4 of income tax on sickness benefits alone, more than we spend on our entire national defence. By the end of this decade, the cost will exceed £100 billion from a current £60 billion. This trajectory is unsustainable, and it puts at risk the long-term viability of the system itself.
The word “unsustainable” comes not from me but from the right honourable Alan Milburn, as a senior adviser in the DWP and an ex-Labour Secretary of State, following the cave-in by the Government to their Back-Benchers against the proposed £5 billion reduction to the welfare bill. He has cautioned against “running away” from reform—and, of course, he is right. On Friday, on “Any Questions?”, the Minister’s own DWP colleague, Minister Alison McGovern, said that progress “must be made” on welfare. However, following the removal of Clause 5, the Secretary of State Liz Kendall said in the other place that PIP is not about making savings but about making sure that this benefit is “fair and fit” for the future. That is a rapid and catastrophic moving of the goalposts. I presume that the Secretary of State has put in a call to the OBR to stand it down from scoring on any savings. I wonder what the Chancellor thinks about this.
As the Resolution Foundation has stated, the body from whence came Torsten Bell, our Pensions Minister, the Government have
“basically eradicated all of the savings they had hoped to make this decade”.
It is extraordinary that the report of the Timms review, to be co-produced by the disability groups, as the Minister said, will not be ready until Autumn 2026 —two years and three months after the general election and into the next Parliament. The Government will surely need to respond. By then, more than 3,000 people a day will have continued to sign on to PIP.
Will the government response at least be published at the same time as the review? Why is the review going to take so long? It is very likely that legislation will then be required. How long will this take? How long will it all take? These delays are a major issue for the Government; they are very damaging and very expensive.
As Kemi Badenoch said recently:
“28 million people in Britain are now working to pay the wages and benefits of 28 million others”.
She went on to say that this country is a welfare state supporting an economy. As a leader in the Times highlighted last week, this is one of the most serious issues stifling growth—the key driver for this Government, as we have been hearing. The noble Baroness the Minister, in her reply, will produce a riposte, I am sure, concerning the last 14 years. I hope she does, because it is a positive story.
The last Government made the hard choice to reform universal credit, replacing six benefits with one, leading to a system that proved 100% robust under the severe pressures of Covid in 2020-21, where the old system would undoubtedly have failed. We also generated an extra 4 million jobs between 2010 and 2024, and this should not be forgotten. This is a huge contrast to the current deteriorating macroeconomic backdrop, stemming directly from this Government’s decisions, and I will name a few: inflation remains above target, at 3.6%; payroll employment is down 0.6% compared to this time last year; vacancies are down by over 63,000 year on year; slack in the economy is widening; and debt now stands at 94% of GDP.
Behind the economics lies a deeper moral case for reform, and my noble friend Lady Stedman-Scott may expand upon this later. We commenced our PIP consultation in 2023. Why was this pulled by the Government in favour of their own, causing years—and I do mean years—of delays to change? This was surely ideologically driven and, in retrospect, another big error made by the Government.
Let me state an important point. On these Benches, we have consistently said and continue to emphasise, and it is also my personal viewpoint, that for those who genuinely need help, notably with a severe mental or physical condition or illness, the state—and by “the state”, I mean the taxpayer—should provide support. After all, we are a developed and civilised nation. But radical reform is needed, which the last Government started on the back of the Covid period. A measure of the current urgency is highlighted by the Centre for Social Justice, which states that a recipient of the highest level of sickness benefits earns £2,500 a year more than someone on the national living wage. We continue to believe that individual help is needed to aid those on sickness-related benefits into work, which is essential and urgent for a range of different benefit cohorts. What we need is not just money but targeted investment that works. Higher welfare spending is not always compassionate. It can trap people, stripping them of agency, of purpose and of independence. A life on benefits is not a life of dignity. Aspiration, work and opportunity confer meaning; dependency corrodes.
Let us speak plainly: the UK cannot sustain a situation any longer in which one in four people self-identifies as disabled. That is not compassion; it is category or descriptor creep. We risk draining the term of its meaning and its moral force. The welfare state must be focused, it must be functional and it must be fair. Trevor Phillips made an interesting recent observation in the Times. He said:
“In 1995, the Disability Discrimination Act marked a transition from what used to be called the ‘medical’ model of disability to the ‘social’ model”,
meaning that a disability was deemed to have become a “manifestation of human diversity”. The number of people who come under the description of disabled—and this is a very important point—has rocketed from one in 50 to one in four: that is 16 million inactive people. The cohort for benefit eligibility has ballooned from 600,000 in 1990 to 7.2 million today, and this partly explains why 47% of those who successfully self-declare disability between the ages of 16 and 65 do so for mental health or musculoskeletal reasons. This is why welfare reform is no longer a matter of political choice, and the Government know it: it is a matter of urgent national necessity.
Now, as alluded to by the Minister, we are told that £1 billion, plus a bit more from the last spending review, has been allocated to support people back into work, but is this serious structural reform or just surface-level spending? What is the breakdown of that allocation? How far will it go? Who will make the decisions? How much of it will reach front-line, human-facing interventions? Will the noble Baroness, in her winding up, give us more information on this? Will she at least say when the “right to try” SI will be debated? When is it likely to commence and be rolled out on the ground?
At last, I turn briefly to the Bill itself, which makes a damp squib look like the top-of-the-range firecracker. The easy decision for the Government, their decision, is the increase in UC rates. Then we have the severely watered-down LCWRA restrictions for new claimants from April 2026. And that is basically it. The Bill before us today, what remains of it, fails to take the bold, essential steps required to reduce dependency, bring down the welfare bill, empower PIP claimants and reform eligibility criteria. The Bill offers no credible strategy to reduce long-term demand on the system. What in the Bill helps to address the rise in the sick-note culture, the increasing ease with which people are signed off work with a fit note? Where is the reform to clinical accountability or the incentives to keep people engaged in the labour market? Perhaps the noble Baroness could address these points in her winding up.
I believe that the political fault-lines are now clear. Labour entered office decrying a fiscal hole, then reached for tax rises, not reform. Higher taxes were not inevitable. They were a choice, a preference, not a necessity. This Government, facing their own internal rebellion, as we have seen, have now retreated from reform altogether. However, the electorate sees through this paralysis. They know the real questions which remain unanswered. These are, briefly: who truly needs state support? How do we reduce dependency without punishing the vulnerable? And how do we ensure that systems designed to protect do not entrench disempowerment? These are the questions that the Bill fails to answer.
Nowhere is the gap clearer than in the Government’s abandonment of the PIP review and Clause 5. It was a crucial opportunity to reset eligibility, rebuild public confidence and ensure that the system is reaching the right people. Why was it quietly cancelled? We need structural reform now, reform that reduces dependency, narrows eligibility where appropriate and ensures that those in genuine need are protected and supported. Ministers appear unwilling to confront the hard trade-offs or to engage seriously with what rising dependency and spiralling costs mean for the future of the welfare state and the state of the national finances. I conclude with another sobering statistic. Benefit claimants in most member states in the OECD have fallen below pre-Covid levels. In the UK, they have increased, so welfare dependency is, unfortunately, a British disease.
I conclude on a more conciliatory note. I look forward to the valedictory speech of the noble Baroness, Lady Bryan, and to the maiden speech of my noble friend Lady Shawcross-Wolfson, who I suspect may highlight issues relating to work, welfare and the family, not least from her influential and authoritative period spent in No. 10.
Baroness Tyler of Enfield (LD)
My Lords, to say that this Bill, in its various incarnations, has had a bumpy ride would be something of an understatement. The Bill is now being rushed through Parliament at what feels like an indecent pace and now, having been assigned as a money Bill, it means that this Chamber cannot undertake its normal scrutiny. In short, the Bill has had neither proper consultation nor in-depth scrutiny. To be blunt, the whole parliamentary process has been shambolic, and I fear that this has seriously damaged trust with disabled people, including those with mental health problems, who have needlessly gone through turmoil.
I totally understand that the current welfare bill is unsustainably high and that reform is needed, but if the Government are serious about cutting welfare spending at source, they would also get serious about fixing health and social care without delay so as to tackle chronic ill health at its root, rather than start by trying to cut funding for carers and some of the most vulnerable.
Having made those general points, I will focus on two issues which give me real cause for concern. The first is mental health. The initial plans in the Bill when it was introduced would have had a devastating impact on people with mental health problems. Although I welcome the announcement of the Timms review of the PIP assessment, to which I will return, there remain fundamental flaws with the Government’s plans. The cut to the health element of universal credit, which remains, will mean that about 750,000 disabled people will miss out on about £3,000 a year by the end of the decade. This will include many people with mental health problems who find themselves too unwell to work.
These cuts to universal credit are supposed to be safeguarded by the new severe conditions criteria, which apply to people who meet a set of requirements including having a lifelong condition and being likely to satisfy the relevant criteria for the rest of their life. This will mean two things: first, that at least one of the descriptors of people’s conditions applies to them “constantly”; secondly, that they will have been given an official diagnosis by an NHS practitioner. I share the concern of many in the sector about the requirement for a descriptor to apply constantly because, for many mental health problems, even severe ones such as schizophrenia, people’s mental health can fluctuate. This sort of fluctuating condition also applies to people with severe conditions such as MS and Parkinson’s.
I am also concerned about the new NHS diagnostic requirement, as we know that many people with mental health problems can wait years to receive a diagnosis and many feel forced to receive or seek treatment outside the NHS because of very long waiting lists or inaccessible services. It just does not feel fair to penalise people who seek private diagnosis and treatment due to the inadequacies of the current NHS.
I share the concern expressed by some about the extent to which the Timms review into personal independence payments will be a genuinely co-produced endeavour. Despite welcome promises to work closely with disabled people on changes to the system, the way this Bill has been handled so far—and, frankly, the way it fell apart—demonstrates a clear lack of consultation with the people most affected. It is also unclear what obligations the Government will have to implement the review’s recommendations and whether they will need to be bound by the current spending envelope of the cuts we have already seen. Can the Minister give me an assurance that there will be proper parliamentary scrutiny, including full debates in both Chambers, following the publication of the Timms review?
I return to the Bill’s impact on unpaid carers. Given that PIP is a crucial gateway for carer’s allowance and other carer benefits and that 150,000 disabled carers receive PIP, it is vital that the Government provide a firm commitment that unpaid carers and organisations that represent them will be consulted and fully engaged with throughout the Timms review. This time, we really need to take the time to get it right.
What assurances can the Government give that the outcome of the Timms review will not lead to significant numbers of unpaid carers being put at risk of losing their own benefits entitlement? It is worth reminding ourselves that the original Bill would have resulted in 150,000 carers losing entitlement to carer’s allowance. I quote one carer: “The extra costs we faced as carers will not disappear if the health element is cut. For those of us like myself who are carers and disabled, this will be a double whammy”.
Baroness Bennett of Manor Castle
At end to insert “but regrets the impact of the Bill, particularly with regard to age discrimination, the impact on people with high levels of need and mental health conditions, and the overall impact on rates and severity of poverty among people with disabilities, and notes the human rights concerns expressed by the United Nations Committee on the Rights of Persons with Disabilities.”
Baroness Bennett of Manor Castle (GP)
My Lords, it is a great pleasure to follow the noble Baroness, Lady Tyler. I echo her concerns about the way in which this is being rushed through procedurally and how its being declared a money Bill denies us the broader debate that we might otherwise be having. I thank the Minister for introducing the Bill, welcome the noble Baroness, Lady Shawcross-Wolfson, and express my sadness at the departure of the noble Baroness, Lady Bryan of Partick.
I begin, perhaps surprisingly, by agreeing with the Minister and the noble Viscount, Lord Younger, that we have a problem with ill health—but it is not a problem with providing benefits for ill health. The noble Baroness, Lady Tyler, referred to the delays and problems with NHS treatment and social care. I add that we are a deeply unhealthy society; we have food systems and housing of terrible quality, and problems with air quality, nature and the environment, low pay, and insecure work. All these things make people ill. We very much need to tackle those issues, but if we deny people enough money to live on and to be able to afford healthy food, that will not make them healthier. That is the basic reason for my regret amendment.
I have spent more time explaining what a regret amendment is in the past couple of days than I might have expected. I know that a lot of people are listening tonight, so it is worth stressing that the House of Lords has no power to stop or amend this Bill. A regret amendment is the strongest thing that I am able to do. Its practical effect is absolutely nothing, but I intend— I have tried to make sure everyone is aware of this—to put it to a vote, because it is really important that people out there who will be affected by this Bill have the chance to know that there are people supporting then. In the other place, 47 Labour MPs and many others indicated at Third Reading that they did not want this Bill to proceed.
The regret amendment notes the effects of the Bill on
“age discrimination, the impact on people with high levels of need and mental health conditions, and the overall impact on rates and severity of poverty among people with disabilities, and notes the human rights concerns expressed by the United Nations Committee on the Rights of Persons with Disabilities”.
That reflects the perspective of the Disability Rights UK briefing on the Bill, which I have widely circulated:
“Debt and poverty are already a fact of life for existing Disabled claimants of UC, with many unable to afford essentials such as food, energy and housing or the additional costs of disability. The cuts will exacerbate this grave situation even further, pushing people into deep poverty”.
I and many other noble Lords, I am sure, have received a flood of briefings from organisations representing disabled people, including Scope, Sense, the Cystic Fibrosis Trust, Parkinson’s UK, the Mental Health Foundation and Amnesty International. The last of those clearly identifies, as the UN did, that this is a human rights issue, as the regret amendment points out. The latest letter from the UN committee points out that this is going backwards, when it had already identified that there was a problem. Looking at what that means, recent research from the Trussell Trust and YouGov found that one in five people receiving universal credit and disability benefits now has been forced to use a food bank in the past month. What will that do to people’s health? How will that equip them to find work, if that is even a possibility?
There is a further joint briefing involving many of those organisations, as well as the Disability Benefits Consortium, the Trussell Trust, Citizens Advice, the Joseph Rowntree Foundation, the Child Poverty Action Group, the New Economics Foundation, Z2K, Turn2us, the MS Society and Carers UK. It highlights how the Bill as it stands means that the existing recipients of the health element of universal credit will not see their payments frozen but will also not feel most of the benefit of the £250 per year increase in the standard allowance, which the Minister and the Government have made much of. About 50,000 more disabled people and people in households with disabled people are predicted to be in poverty by 2030 as a result.
Perhaps the most pernicious part of this is the key Clause 2, which cuts the limited capability for work and work-related activity, or LCWRA, element of universal credit—generally known as the health element—and will affect more than 750,000 disabled people by £3,000 a year, an effect that will only continue to grow unless we get a future Government who are concerned about the rights of disabled people and basic humanity. That means effective age discrimination, since younger people are far more likely to be affected.
As Sense points out, if the people with complex needs whom it represents received £47 less in support each week, a quarter would be pushed into debt—often further debt—and one in five say they would be forced to go without essential support to basically live their lives. The Government claim, and the Minister said, that some people with terminal illness and lifelong conditions will be protected, but the impact assessment confirms that fewer than 10% of new claims would be saved by this. The Cystic Fibrosis Trust says that few of the adults it represents are likely to meet the severe conditions criteria,
“despite the fact that a typical person with cystic fibrosis on the health element of universal credit is someone who cannot walk 200 metres within a reasonable timescale, the majority of the time is at risk of voiding their bowels and/or bladder, and would spend a significant portion of their day performing their daily treatments”.
Those are the people the Bill explicitly targets for benefit cuts. If the Minister can tell me that they are going to be protected, I am interested to have that on the record, but that is not what charities that are experts in this area believe. Parkinson’s UK notes that it has legal opinions from two different experts concluding that the severe conditions criteria are likely to effectively prevent people with Parkinson’s getting the higher-rate health element.
I came into your Lordships’ House promising to share the voice of the voiceless. As I am sure many others have, I have received hundreds of emails from individual disabled people and their carers, setting out their situations. I am going to use just one, with permission, although I will not name the person to protect their and their family’s privacy. This woman is a former elected Labour councillor and former NHS professional. She is a carer for her young adult autistic son and a parent with multiple sclerosis. She says, “I am currently advocating for my son, who has applied for universal credit and is now undergoing the LCWRA assessment. Without me helping him, my son could not negotiate this system. Cutting the health element for these young people is wicked. This is how they end up on the streets when there is no family to support them. This generation has been shafted by the SEND system. Most did not achieve their potential due to unmet needs and lack of support in school. They are at higher risk of mental health issues; they are less likely to gain employment”. She notes that the first requirement of most job ads is excellent communication skills. She says, “My son is selectively mute. He is at an immediate disadvantage”. Can the noble Baroness, Lady Stedman-Scott, responding for the Official Opposition, confirm that, having listened to the speech by the noble Viscount, Lord Leckie, she agrees that this family needs the strongest possible support? I hope the noble Baroness can confirm that.
I conclude with remarks from this former Labour councillor, who said, “I am shocked and appalled at this proposal. It really will destroy lives”. I am sorry that I will not be able to respond individually to everyone who has emailed me; the volume is just too great. It is a collective testament to the fact that disabled people in our society are not feeling how Sir Keir Starmer told the Liaison Committee yesterday that he wants them to feel. They are not feeling secure and supported; they are feeling the opposite. I beg to move.
Baroness Grey-Thompson (CB)
My Lords, I declare my interests as president of the Local Government Association and a recipient of personal independence payment.
Like others, I have received many emails from people worried about the proposed changes and I am extremely concerned about how this narrative has played out in the media. Disabled people are being portrayed as benefit scroungers and a drain on society. Like others, I am disappointed that this has been made a money Bill. I recognise that the Bill is different from what His Majesty’s Government originally intended, due to a number of concessions. I am frustrated that Members in another place, when talking about PIP specifically, seem to have become confused, called it a not-in-work benefit and conflated it with the Pathways to Work Green Paper. It is not a benefit that is linked to whether you work. These fundamental inaccuracies do not help a reasoned debate about proposed changes.
I will briefly cover personal independence payment because it is integral to disabled people’s lives. It exists because society is inaccessible. Successive Governments have been slow to bring about the necessary changes to make society more inclusive, and disabled people face discrimination in all areas of their lives, whether that be in public transport, healthcare, education or employment, to name a few. People should be working, and I agree that the system is not sustainable in its current format. However, the extra costs of being disabled have not gone away. Scope has published a disability price tag and, even after taking PIP into account, the average household that includes at least one disabled adult or child faces extra costs of £975 per month. This figure is updated yearly.
Also of concern is the article in the i paper yesterday that reported errors in the way that PIP has been awarded that could cost the Department for Work and Pensions another £260 million. Ultimately, I believe we are missing a fundamental opportunity to look at the whole system, and I hope that Access to Work can be part of a wider review. What we are doing at the moment feels slightly too piecemeal.
The current Bill could develop a two-tier system. I repeat the quote from Disability Rights UK given by the noble Baroness, Lady Bennett of Manor Castle:
“Debt and poverty are already a fact of life for existing Disabled claimants of UC, with many unable to afford essentials such as food, energy and housing or the additional costs of disability. The cuts will exacerbate this grave situation even further, pushing people into deep poverty”.
There are some more positives with the Bill: the proposed increase to the standard allowance means that 2.3 million disabled people currently receiving universal credit will see the total amount they receive protected, but dramatic cuts to universal credit remain in the Bill, such as the restricted eligibility gateway of the severe conditions criteria. The Institute for Fiscal Studies and the Resolution Foundation think the latest concessions could mean the Government make no net savings by 2029-30.
I am concerned that the tone of the debate has generated quite a lot of victim blaming for disabled people. This is never more apparent than in the debate around Motability cars. I do not have a Motability car, but when I was learning to drive it was the only way I could afford to do so; public transport was even less accessible than it is now. The cost of insurance when you drive on hand controls is high—even more so if you are young. In the media it is being portrayed as a free car, which it is not, and we should remember that over the years it has considerably helped the car industry. There is a website, which was taken down over the weekend with promises to put it back up, to help people detect if “an annoying neighbour” is seen driving a new car. This is terrifying for a number of disabled people. It has been reported to the police; it feels like it crosses a line to incitement. Over the weekend, the replies on the website were despicable. This does not feel like a collaborative environment in which to have sensible debate.
The reality that is the system we have is too complicated and many disabled people find themselves unable to navigate the complex and lengthy processes. We do not have time today to consider it, but I would prefer a system that is better able to assess people’s needs, one that wastes less money with overturned appeals. I welcome the Minister’s comments, but now it is time to rebuild trust and have a genuine consultation. Can she give more information about how we can properly co-produce with disabled people? We have to find a better solution for everybody.
Baroness Andrews (Lab)
My Lords, I am grateful to my noble friend the Minister for introducing the debate with such clarity. I also look forward with great anticipation to the maiden speech of the noble Baroness, Lady Shawcross-Wolfson. I look forward in a slightly different sense—with great regret—to the valedictory speech of my noble friend Lady Bryan of Partick. We will miss her, and I am sorry that she is leaving the House.
I support the Bill because it has found, in a difficult time and in a contested situation, an honourable way through these very difficult issues. It has also started to correct the distortion that has developed between the standard provision and the health-related elements of universal credit. It has begun to nudge towards what we all want to see: a more effective way of supporting people into work. That is the great prize.
I also welcome the fact that the reference to PIP has been removed and that it will now be in the guardianship of Sir Stephen Timms. There could not be a better person to look at PIP; he is a man of huge integrity and respect. He is very likely to listen closely to the people he will involve, and he has already begun to involve disabled people. The tragedy, of course, could have been avoided—the past few weeks have been agonising for disabled people and their carers—if the decision had been taken earlier to do what Sir Stephen intends to do now: to bring them into the dialogue, so that they will help co-produce and co-own their future. It will be a more sustainable future because of their input.
The scale of the challenge has already been set out, not just by my noble friend the Minister but by the noble Viscount, Lord Younger. Between 2019 and March 2025, the number of working-age adults claiming disability rose from 3 million to 4 million—or, from one in 13 to one in 10—a phenomenal increase. Within that, there is of course a disproportionate increase in the number of people claiming for mental health. This has been compounded by years of poor health and disability, rising poverty and deepening inequalities, all of which has been measured and recorded.
Those factors have been years in the making. I say to the noble Viscount that all parties have to own that failure and legacy. That includes the failure to plan for an ageing population, which we knew decades ago would require us to rethink the relationship between health, housing and care; the failure to anticipate the impact of the rising retirement age on the numbers of chronically sick and disabled in work; and the failure to care about the inevitable impact that a decade or more of austerity and the loss of essential services would have on physical and mental health in younger and older life. That was all left in the “too difficult” box—which has now been opened by this Government, who have a particular responsibility to act.
Most recently, Covid changed patterns not just of physical and mental health but of behaviour, which we still do not fully understand. There are some explanations, but there is no one conclusive explanation. On our watch, we have an inescapable duty—one we have to share—to make not just PIP but a new social contract for a welfare state fit for the future. We need to meet the needs for work as well as for support. If nothing changes for the 1 million young people out of work, employment and education, they will be condemned by design to further unemployment and poverty.
I welcome the Timms review, and I think it is welcome too for people with disabilities. When I had the privilege of chairing the Adult Social Care Select Committee, we heard, over a considerable length of time, from disabled people and carers about how the system is not working for them. Because of the precarious nature of this and the sense of anxiety every time there is a review, they know that the greatest danger is to do nothing and therefore introduce the risk that social security will be even worse, maybe to the point of collapse, in the next 10 years.
I particularly welcome the emphasis on co-production, using the experts by experience, who can really inform Ministers on what does and does not work. I want to send a particular message to Sir Stephen via my noble friend the Minister. As was already mentioned by the noble Baroness, Lady Tyler, it is absolutely necessary that unpaid carers be involved in the review and in leadership roles. Sir Stephen has said in the other place that it will be a consideration. Can we please have some information to reassure carers that their voices will be heard in the review? As we showed in our report two years ago, the tragedy of the unpaid carer is that they feel and are invisible. If they are left out of this review, it will be another egregious indication that they really do not matter. Whatever changes for them, they will have to go on caring, and whatever happens to PIP will have an immediate and direct impact on them. I trust my noble friend the Minister to take that message to the other place.
The Lord Bishop of Newcastle
My Lords, I begin by offering my congratulations to the noble Baroness, Lady Shawcross-Wolfson; I look forward to her maiden speech, and acknowledge the valedictory speech of the noble Baroness, Lady Bryan. I also thank Ministers for listening to concerns about the Bill when it was initially brought forward.
A functional social security system tackles poverty and supports people to live full lives. With that, the system needs to retain public confidence, expressing the best of our values. It must also strike a balance between supporting people who are able to work and ensuring that people who cannot work are protected and cherished for who they are. We need economic growth—that is not disputed; this is, after all, a money Bill—but I am concerned for those who are left behind or who do not fit the model of financial productivity at the rate that seems to be desired.
There is a granularity to this debate about the complexity of people’s lives, which do not always fit into neat economic models. I therefore note the point made by the noble Baroness, Lady Bennett, in her amendment to the Motion about the rates of poverty among disabled people, who are already disproportionately likely to be living in poverty. This can have an impact on children, making their start in life all the more challenging and deepening systemic injustices.
This landscape of poverty and economic inactivity is acute in the area covered by my diocese in the north-east. There are opportunities to make a difference in local communities—through devolved authority mayors, councillors, community leaders and citizens—but turning the tide on poverty still requires decisive leadership and vision from central government. One of dozens of emails I have received in recent days came from a father in the north-east, who told me about his son who has complex disabilities. He would like to work one day but is struggling to navigate what feels like a punitive approach in the changes to universal credit. His capacity to enter the workforce faces barriers even before he can contemplate exploring opportunities. Our values should hold us to account for how we raise up the most weak and vulnerable.
What do we need? I suggest some joined-up thinking. I understand the Government’s desire to reform the system. It is becoming more expensive to administer, but even if it were not, proportionate actions should be taken to help people make the most of their gifts and skills, whether in the labour market or through volunteering in their community. As other noble Lords have pointed out, the fact that social security spending is rising, and more people receive health benefits, points to shortcomings elsewhere.
On PIP, we should not shy away from the difficult questions that the Timms review needs to ask and answer about the assessment process, the treatment of physical and mental health, and a reasonable eligibility threshold. None of that can happen without tackling some of the causes of ill health: the under- investment in social security and social housing in recent decades; the shortage of mental health provision; the effects of insecure, demoralising work; and the many other areas that noble Lords have already spoken to. I am glad that the Government are addressing some of these challenges, but I hope they will not be considered in isolation, that the Government will monitor the impact of this Bill closely and that the lives of all our citizens can be improved so we may all flourish together, each according to their capacity and need.
Lord Rook (Lab)
My Lords, I am grateful to my noble friend the Minister for her introduction and to noble Lords for what has already been a broad discussion. I look forward to hearing the maiden speech of the noble Baroness, Lady Shawcross-Wolfson, and to her contribution to your Lordships’ House in the days to come. I also look forward to the valedictory speech of the noble Baroness, Lady Bryan, and wish her all the best for the future.
A long time ago, in a land not so far away, I worked for the Salvation Army as a youth worker. In those distant times, there was a new and unhappy category of young person emerging in our communities. While not entirely the stuff of fantasy or fiction, the prospect of sustainable employment for those young people, who we called NEETs, was not that great. Where working life was concerned, those young adults who were not in education, employment or training needed their Government and communities to help them on their way.
As was the case in 2009, we now have almost 1 million 16 to 24 year-olds who are not in education, employment or training. I welcome the efforts in the Bill to reduce those numbers by increasing the incentive and support provided. This will help to reduce long-term benefit dependency, motivate young people to find their place in the workplace and enable those who currently feel left out to seek a way back in.
In 2009, my honourable friend, the right honourable Sir Stephen Timms, now Minister of State for DWP in the other place, was the architect of the future jobs fund. As a youth worker, I saw first-hand how this programme provided the aspiration and activation that so many young adults needed to step up on to the first rung of the career ladder. The Bill provides young people with similar prospects for support, training and opportunity.
As with other legislation, I am keen that we prioritise young people. After all, this generation has been disproportionately affected by the Covid pandemic and other societal challenges. While the current economic outlook clearly restricts the resources available to the Government, the department’s investment of £2.2 billion over the next four years to increase work, health and skills support for all those struggling to find suitable employment is more than welcome.
Once a youth worker, always a youth worker. While my youth work skills are certainly less in demand here in your Lordships’ House, my heart still goes out to those young people struggling to make their way in our country today.
Of all the challenges we face, the current mental health epidemic among young people is among the most significant and urgently demands the attention of government as a whole. For a significant number of those not in education, employment or training, anxiety, depression and other complex conditions can provide a seemingly insurmountable barrier to employment.
With this in mind, I am particularly heartened by the right to try guarantee. This will make it easier for those who are out of work to make a go of things in the workplace. Where support for young adults is concerned, I hope that today’s legislation will be a good start and not the whole story. There is much that needs to be done, for their sake and ours. I am grateful for the tireless work of my noble friend the Minister, Lady Sherlock, and stand to support the Bill today. Given his previous success in this area, I am thankful that Sir Stephen Timms has been tasked with bringing his unique expertise to the upcoming Timms review. I hope that there will be more creative and impactful policy to come and remain keen to see other institutions take the Government’s lead and invest in our young adults.
At the Salvation Army, I saw how a large employer could grasp a government policy such as the future jobs fund to give disadvantaged young people a much-needed hand up and thus reduce the requirements for future handouts. As the Government seek to quicken the path of young adults into future jobs through the Bill, I hope that other institutions will redouble their efforts to give youth a chance and provide future generations with a brighter future.
Baroness Browning (Con)
My Lords, it is a great pleasure to follow the noble Lord, Lord Rook, and I am also looking forward to the maiden speech of my noble friend Lady Shawcross-Wolfson and to hearing the valedictory speech of the noble Baroness, Lady Bryan, later in the debate. I declare my interest as a vice-president of the National Autistic Society and note that I am a vice-chair of the APPG for both autism and for Parkinson’s. I am not going to talk about PIP. We will almost certainly return to that after the Timms report.
The Bill proposes that people with disabilities applying for universal credit in 2026-27 will receive a reduced amount of benefit, from £97 a week to £47 a week. It is a little early to know what the Equality Act will make of that—two people with the same needs and the same disability. When the Minister sums up, it would be very helpful to hear what the appeal procedure is going to be, because I suggest it will be put to a lot of use.
According to the Bill, young disabled people with limited capacity for work-related activity will not be able to claim until they are 22. At the moment, under the age of 22, younger teenagers and those who are above 18 can claim. Here, we are talking about children most likely to have grown up with a lifelong disability, and now they must wait until they are 22. If there is anything one can do to help children with lifelong disabilities, it is to give them a sense of purpose. The idea that there is going to be a stopgap in that procedure concerns me greatly.
Under the Bill, disabled people will be required to provide an NHS diagnosis to comply with the severe conditions criteria. The criteria are narrow and could reduce, as we have heard, the annual amount by 3,000 a year by 2028. Could the Minister explain whether, if a person has a private diagnosis from a registered doctor or psychologist, that will be accepted?
The Government call these changes “adjustments” and “balancing”. I understand the Government’s problem and I know it is growing exponentially. I agree with the comments we have heard from the noble Baroness, Lady Bennett of Manor Castle, about the impact on the sickness of the nation, for various reasons, that has affected general health, in terms of environmental issues. I also agree with the comments from the noble Baroness, Lady Andrews, who raised the issue of the outcome of experiencing Covid as a nation. I still do not think we fully understand the impact that Covid has had, not only on those families who lost people but on those people who worked on the front line. I believe that has had an impact far greater than we fully understand.
In today’s Times, William Hague writes—and I am going to mention another Labour Secretary of State for the second time in this debate—that the former Labour Secretary State Alan Milburn says that the Government should reform to a 10-year horizon, not a single Parliament. I agree with that, because I believe that the single-Parliament approach—or the cliff edge, as it is—sorts people into those who receive benefits and those who do not. I would go further. The employment opportunities for disabled people and the benefits they qualify for should not be based on a one-size-fits-all.
We have heard from many charities. I too have heard from most of the charities mentioned, which all have grave concerns for their members about the impact. They need to be reassured, as of course do the people with disabilities.
People with disabilities who do not receive an out of work benefit or a workplace benefit will end up in the second division of priority and will be affected. There is no doubt about it, they will be affected. The results will become obvious in time. The Government hope that a new approach to employment, training and opportunities for disabled people will bridge that damage. I know that this Minister in particular will do her best to see that that happens, but it would have been far better if there was a 10-year transition, with the job changes preceding the change in benefits.
Lord Hendy (Lab)
My Lords, it is an honour to follow the noble Baroness, Lady Browning. The retirement of the noble Baroness, Lady Bryan of Partick, is a loss to the House and a loss to me personally. On behalf of her adopted home in Scotland, she has made a significant contribution to devolution and constitutional affairs more generally, in spite of the fact that she is really a cockney sparrow. She has many friends here and I shall particularly miss her friendship and solidarity. I join with other Peers to welcome the noble Baroness, Lady Shawcross-Wolfson, and I look forward to her maiden speech, which will follow in a few minutes.
The Bill was introduced, of course, to cut government spending on welfare; that was the justification originally. That was and is not necessary. In the sixth-richest country in the world, there are many more ways of balancing the Government’s books than by cutting payments to the disabled. My noble friend the Minister says that these changes will encourage those who will lose benefit into work, and that work is the way out of poverty. I understand the sentiment, of course, but two factors must be borne in mind. First, there are not 750,000 vacant jobs waiting for disabled or partially disabled people to fill. Secondly, the jobs that may be available will not necessarily lift them out of poverty. The fact is that 31% of those on universal credit are in work, so low are the wages at the bottom end of the labour market. The proposed changes, as has been mentioned, cut the health element of universal credit for those claiming after April 2026 from £97 a week to £50 a week. That cut does not reflect diminished need but is irrespective of need. It is solely to save the Government money. That, I find unacceptable.
The proposed changes also appear to conflict with the United Kingdom’s obligations under the International Covenant on Economic, Social and Cultural Rights and the United Nations Convention on the Rights of Persons with Disabilities. The International Covenant on Economic, Social and Cultural Rights is supervised by a committee with that name, and it has said this:
“In its general comment No. 5 … on persons with disabilities, the Committee emphasized the importance of providing adequate income support to persons with disabilities who, owing to disability or disability-related factors, have temporarily lost, or received a reduction in, their income, have been denied employment opportunities or have a permanent disability … Benefits, whether in cash or in kind, must be adequate in amount and duration in order that everyone may realize his or her rights to family protection and assistance, an adequate standard of living and adequate access to health care, as contained in articles 10, 11 and 12 of the Covenant”.
Under the United Nations declaration, Article 28 provides:
“States Parties recognize the right of persons with disabilities to an adequate standard of living for themselves and their families, including adequate food, clothing and housing, and to the continuous improvement of living conditions, and shall take appropriate steps to safeguard and promote the realization of this right without discrimination on the basis of disability”.
I will not read further for reasons of time. It seems to me that there is a significant risk here that the United Kingdom is or will become in breach of its international obligations.
In addition, eight out of nine new claimants who would currently qualify for full limited capability for work and work-related activity payments will not receive them because of the new fourfold, severe conditions criteria. I will leave others to develop the injustices of those. The Joseph Rowntree Foundation and the New Economics Foundation estimate that the effect of the Bill will be to put 50,000 more people into poverty, and those are people who are disabled and their families.
The removal of benefits from those who would otherwise be entitled to it is something that I cannot support. I know that my noble friend the Minister is not responsible for the proposal, but I hope that the Timms review will cause the Government to think again.
Baroness Shawcross-Wolfson (Con) (Maiden Speech)
My Lords, it is a huge honour to make my maiden speech here in your Lordships’ House, and I am grateful for all the warm wishes that I have received. I want to thank those who have helped me since my introduction, first and foremost Mr Ingram and the doorkeepers, who have been unfailingly kind, along with Black Rod and the rest of the staff of the House. I must also thank my supporters, the noble Lord, Lord Butler, and my noble friend Lady Jenkin. In different ways, they have both inspired me across the years.
Like all of us, I am the product of my family, and, like many of us, my family's story is one of immigration and integration. My father’s father, Hartley Shawcross, came from Lancashire stock. He was a barrister, an MP, Clement Attlee’s Attorney-General and Britain’s chief prosecutor at the Nuremberg trials. In 1959, he was among the first life Peers to be introduced into your Lordships’ House and sat as a Cross-Bencher. My mother’s mother, Leah Katzeff, was born in Lithuania, but her parents, fearing persecution and poverty, emigrated to South Africa when she was an infant. The family who stayed behind were all murdered in Lithuania as the Nazis advanced in the summer of 1941.
My grandparents led vastly different lives. My childhood memories are of clotted cream in Cornwall and chopped liver in Camden. But they shared a love of this country, a commitment to liberty, and a belief in the rule of law. My English grandfather helped to try those ultimately responsible for the murder of my Lithuanian grandmother’s family. My Lithuanian grandmother spent the second half of her life here in England campaigning for human rights and ending her career as director of Justice, a charity my grandfather co-founded decades earlier. Their stories, and the stories of my parents, shaped my sense of purpose.
After starting a career in management consultancy, a desire to be more useful and, I confess, youthful optimism, led me into politics. My grandfather and father both started on the left of the political spectrum and moved right over their careers. I thought I would save myself the trouble and start squarely in the centre-right. After nearly 20 years in Westminster, I have worked with wonderful politicians and civil servants: too many to thank individually. I particularly thank George Osborne, who took a chance in 2007 that a spreadsheet-literate consultant might be useful on his team. George was a wonderful boss—such a good boss, in fact, that he introduced me to my husband, my noble kinsman Lord Wolfson of Aspley Guise. The career I began with George ultimately led me to No. 10 Downing Street, where I ran the Policy Unit for Rishi Sunak. It was the honour of a lifetime. Rishi believes in public service to his core, and I hope to follow the example he sets in public life: unstinting hard work, steadfast integrity and personal kindness.
If the first duty of government is defence of the realm and the second the rule of law, the third, I would argue, is to help the vulnerable. I was fortunate to spend time at the Department for Work and Pensions, most recently as a non-executive director, when the noble Baroness, Lady Coffey, was Secretary of State. As our population ages and demand grows, this country has to grapple with how to run an effective, fair and sustainable healthcare and welfare system. I am grateful for the opportunity to speak in this debate on the universal credit Bill, and I offer two reflections today.
First, we must always live within our means, so every spending decision is a trade-off. Here, I must acknowledge the influence of the noble Lord, Lord Macpherson, and six years working at HM Treasury. Borrowing more is not a solution. I agree totally with the Chancellor when she said that there is nothing progressive about a Government who simply spend more and more each year on debt interest. Instead, we must choose. Reasonable people can and do disagree on what those choices should be, as we can see here today. This debate makes for better decisions, but trade- offs are unavoidable, and we cannot pretend otherwise.
Secondly, policy is always about people. The numbers must add up, but every pound taxed, every pound spent, every incentive created, every disincentive introduced, makes a difference to people’s lives. The Government’s job—and I really know from first-hand how difficult this is—is to see it all: the big-picture cost, the systemic incentives and the individuals at the heart of it.
Twenty years in politics—or perhaps it is just middle age—have tempered my youthful optimism but not my belief in progress. I know that there will be difficult decisions ahead, but I am greatly encouraged by the wisdom, determination and civility that I have witnessed in this Chamber. I will do my best to follow the example that you have all set, and I look forward to making whatever contribution I can to your Lordships’ House.
Lord Elliott of Mickle Fell (Con)
My Lords, it is a huge honour and privilege to be the first to congratulate my noble friend Lady Shawcross-Wolfson on her superb and very moving maiden speech. I am particularly pleased that my noble friend chose a debate on welfare policy to make her debut. Having served in the Department for Work and Pensions as both the chief of staff and a non-executive director, she brings great expertise to this debate. As she reminded us, it is our duty, in our position of privilege, to look out for those less fortunate than ourselves, an obligation expressed beautifully in the speech that we just heard.
My noble friend also brings with her six years’ experience of working in His Majesty’s Treasury. This too is crucial—to policy generally and to welfare policy specifically—because without a growing economy we cannot pay for welfare spending and without a conducive business environment, we cannot create the good jobs that are needed to help people on their journey from welfare to work.
I should also mention my noble friend’s two years as head of the No. 10 Policy Unit. In this capacity, she joins many distinguished Members of your Lordships’ House, including—I am hoping that Wikipedia has not let me down here—the noble Lords, Lord Donoughue and Lord Adonis, the noble Baroness, Lady Hogg, my noble friends Lord Griffiths, Lord Blackwell, Lord O’Shaughnessy and Lord Johnson of Marylebone and, last but certainly not least, the noble Baroness, Lady Cavendish of Little Venice. If the No. 10 Policy Unit alumni do not already have a dining club, I hope that they consider setting one up. We are all lucky to have the pre-eminent brains trust of the country in our midst, including their newest member, my noble friend Lady Shawcross-Wolfson. I offer her many congratulations on a superb maiden speech and our collective thanks in advance for her contributions to this House in the years to come.
Turning to today’s debate, I very much welcome the Government’s aim with this Bill—to get people into work. I was heartened when the Prime Minister said in December, at the launch of the Get Britain Working White Paper:
“Getting Britain back to work is at the heart of my mission to grow the economy”.
This objective is to be applauded. The Government’s Pathways to Work Green Paper in March outlined their plan for getting people into work. This Bill is a key element of that plan in its desire to shift from the current system, which incentivises applicants to maximise health-related benefits.
However, having followed closely the debate on the Bill in the other place, I was disappointed that very few commented on the positive and important role that the business community has to play in getting people from welfare into work. The debate today rightly has delved into a lot of detail about the workings of the benefit system, but the other element of getting people from welfare to work must be the availability of good jobs with appropriate training. The role of the business community as the primary creator and provider of jobs in our economy is therefore paramount. I realise that this point goes slightly beyond the narrow focus of this Bill, but for its overall objective to be achieved it requires the carrot of decent jobs for people to transition to, as the Government’s overall plan recognises.
I will use my remaining time to plant the seed of an idea for a cost-free measure to ensure that there is a carrot of good jobs for people to go to and a carrot for employers to provide these jobs. The proposal is as follows. Noble Lords will be aware there is currently a scheme to incentivise employers to hire veterans, which was introduced by Rishi Sunak in 2020 when he was Chancellor of the Exchequer and extended earlier this year by the Government to run until at least 2026. The scheme is simple. Employers who hire ex-Armed Forces personnel do not have to pay employers’ national insurance contributions during their first year of employment. This is facilitated through a zero rate of employers’ NI on salaries below £50,270 a year. A separate national insurance category is used when submitting payroll reports to HMRC. Similarly, employers hiring those under 21 do not have to pay class 1 national insurance contributions up to the lower earnings limit for these workers. In its submission ahead of the Autumn Budget, I hope that the Department for Work and Pensions might propose extending this scheme or replicating it for those who are moving from welfare into work.
I declare an interest: the proposal was recently suggested by the Jobs Foundation charity, of which I am president, as declared in the register. It was also advocated recently by the Good Growth Foundation, which was founded by and is directed by Praful Nargund, who stood as the Labour candidate for Islington North in the 2024 general election. The Good Growth Foundation is chaired by Tim Allan—who I understand from the Sunday newspapers might soon be joining the Civil Service as a Permanent Secretary—and has on its advisory council the noble Lord, Lord Liddle, whom I see in his place. I hope that he supports the proposal as well. I say this to emphasise and doubly underline that this is not a party-political suggestion but a common-sense suggestion. Even better, it will not cost the Treasury anything. The Good Growth Foundation estimates that the policy would save the Exchequer up to £1.1 billion every year. I am not expecting a commitment from the Minister tonight, but perhaps she might give us her initial thoughts on the proposal at the end of the debate and commit to asking her officials to look into it further.
Returning to where I began, if there is a dining club of former heads of the No. 10 Policy Unit, I hope that they discuss this at their next gathering. It seems to be an eminently sensible suggestion, and anything that encourages employers to help people on welfare into work and saves taxpayers money is surely worth serious consideration by the Treasury to help deliver on the very worthy aims of this Bill.
Baroness Lister of Burtersett (Lab)
My Lords, I pay tribute to the many disabled people and disability and anti-poverty organisations, as well as colleagues in the Commons who listened to them, for winning concessions and shrinking this Bill to exclude PIP. Nevertheless, there remain serious concerns. Although, thankfully, for the most part existing claimants are protected, the shrunken Bill will still cause real damage. Yet the rushed process does not allow for proper scrutiny—a criticism voiced by the many disabled people who have emailed us. We should not underestimate the degree of anxiety, stress and mistrust that this episode has caused them.
The joint civil society briefing, for which I am grateful, warns that by 2030 the cuts to the health element of universal credit will mean a loss of £3,000 a year for 750,000 disabled people, with the impact increasing in future years. They will also have a damaging knock-on effect on carers, some of whom are themselves disabled. A major point of concern is the drafting of the severe conditions criteria, which will protect a small number of future health element claimants with a terminal illness or lifelong condition, and in particular the “constantly” requirement, which applies a more stringent standard than now, to the detriment of people with severe conditions that fluctuate day to day, including MS and Parkinson’s. The Minister in the Commons tried to address this at Third Reading, but the civil society briefing warns that
“there is a gap between the stated intention to exactly reflect the existing severe conditions, and the test which is written into … the legislation”.
Given the lack of time to look at this properly now, will my noble friend consider withdrawing paragraph 6 of Schedule 1, which simply amends existing regulations, so that this can be sorted out through secondary legislation? What the Minister said so helpfully in the Commons needs to be written clearly into legislation. Can my noble friend explain why it is not?
As noted, the Joseph Rowntree Foundation and the New Economics Foundation estimate that the net effect of the Bill’s measures will be an increase of around 50,000 in the numbers of those in poverty by 2029-30. Yet disabled people are already at disproportionate risk of poverty, as demonstrated by a recent report from the APPG on Poverty and Inequality, which I co-chair. Disabled women are particularly at risk—one of the human rights concerns raised by the UN—but the revised impact assessment offers only a superficial high-level equalities analysis rather than a proper equalities impact assessment.
The one mitigating provision in the Bill is the very welcome real increase in the UC standard allowance, which contributes to the aimed-for rebalancing of it and the health element. However, the rebalancing is not exactly balanced as, between the cuts to the health element and the improvements in the basic UC rate, even by the end of the decade we are talking about a real increase of only around £5 a week. Of course, even £5 matters to someone on a very low income, but it is hardly enough to provide the dignity and security that is promised in the impact assessment—which acknowledges that this only starts to improve basic adequacy. As the Resolution Foundation warns, it will still leave benefit income being far from adequate. Moreover, the impact assessment acknowledges that a “fairly small number” will not gain from the increase, because of the benefit cap. Can my noble friend indicate how many this “fairly small number” will be, considering that anyone who loses entitlement to the health element could then be subject to the cap?
I welcome the commitment to coproduction of the Timms review, and the assurances he has given. I hope these will allay the totally understandable fears of disabled people and carers, given the lack even of genuine consultation hitherto. But while, like him, I hope the review group will be able to achieve a consensus, if it does not, then what? Can my noble friend say whether, in such a scenario, those who disagreed with the outcome would be able to publish their views as part of the official report?
When recently I asked my noble friend whether the DWP would consider extending the principle of coproduction to the UC review, she tried to reassure me with reference to forthcoming focus groups with Changing Realities. I am a great supporter of Changing Realities, which brings the expertise of lived experience into the policy domain, but a few focus groups do not amount to coproduction. In an unanswered letter to Minister Timms, the APPG on Poverty and Inequality made the case for establishing a formal mechanism for coproduction and meaningful consultation with those who have experience of claiming UC, so as to avoid the shortcomings of the current scheme.
Finally, I hope the omnishambles of the past few weeks will stand as a lesson for how not to carry out social security reform. Yes, there is general agreement that we need reform. Indeed, I have been arguing for it for years, all the more urgently after a decade or so of cuts amounting to £50 billion a year—the very opposite of the scare stories about ballooning expenditure. Charities, think tanks and academics all make the case for investment in social security as a force for good rather than treating it as a dead weight. It is time we put the security back into social security.
Baroness Brinton (LD)
My Lords, I declare my interest as a vice-president of the Local Government Association. It is a pleasure to follow the noble Baroness, Lady Lister of Burtersett. I thank the many disabled people and organisations who have written to us all. I congratulate the noble Baroness, Lady Shawcross-Wolfson, on her maiden speech and look forward to hearing her future contributions. Along with other noble Lords, I look forward to hearing the valedictory speech from the noble Baroness, Lady Bryan, and I wish her well. We will miss her.
Other speakers have outlined the changes in the Bill following the outrage from disabled people, and the major Labour rebellion in the Commons, but there are still concerns about this reduced Bill, as well as the Timms review looking at personal independence payments. The Secretary of State’s tone in her speeches was very worrying right from the start. The premise that all that disabled people and those with serious health problems need is support to get a job was, to disabled people, quite extraordinary. Worse, there was an implication that many of them were workshy. That is not the problem. I entirely agreed with the noble Lord, Lord Elliott, when he set out that more needs to be done to encourage business to offer proper jobs and support disabled people in them.
In referring to changes to PIP, the Secretary of State repeatedly implied that PIP was an in-work benefit—it is not. It is there to help disabled people manage the extra costs of life, as the noble Baroness, Lady Grey-Thompson, outlined. At the Work and Pensions Select Committee last week, my honourable friend, Steve Darling MP, who is visually impaired, had repeatedly to challenge the Secretary of State’s assertion that cutting PIP would help people get into work. Kemi Badenoch MP, the leader of the Opposition, said last week that it was possible to claim PIP by self-certification, as well as suggesting that every disabled person in the country claims disability benefits. She also asserted that it was possible for someone with a food intolerance to get a Motability vehicle. Not one of those statements is true. It is alarming that senior people in the two main parties in the Commons appear to be demonising disabled people, but it is really good that the Minister and the noble Baroness, Lady Stedman-Scott, do not use this approach and this tone.
The definition of a disabled person is someone with a condition or illness that lasts 12 months or more, which limits their ability to carry out day-to-day activities. The one in four statistic includes the elderly: 40% of the elderly fall into the disabled bracket. Perhaps demography is also increasing the number of disabled people.
I turn to what remains of the Bill. On the changes to universal credit, principally the limited capability for work-related activity—the health element—the proposals will create a two-tier benefit system, as others have said, and may breach the Equality Act. It is extraordinary that the Government believe it is acceptable to halve and then freeze the UC element. People with disabilities and health conditions will find their costs far harder to manage, despite having to live with severe conditions. This may mean that they have to resort to the NHS or social care, with increased costs to those public budgets. What assessments have the Government made of the additional costs that are likely to be transferred to the DHSC, other departments and local authorities? The impact assessment on the UC element says on page 5:
“Nearly three million people are not working or looking for work due to ill health, a significant increase of nearly 800,000 since early 2019”.
The noble Baronesses, Lady Andrews and Lady Browning, both mentioned Covid. As the health spokesperson for the Lib Dems during that time, I am interested in the statistics. The ONS data published last year showed that the number of people in England and Scotland with long Covid had increased by 2 million and, of that number, around 381,000 had serious life-limiting Covid. Worse, many doctors are now reporting significant increases in certain serious chronic diseases, such as Parkinson’s, multiple sclerosis and rheumatoid arthritis—caused, it is thought, by triggering the immune system following Covid. Have the long-term direct and indirect consequences of the pandemic been taken into account in these increased numbers? Has advice been sought from the Chief Medical Officer and the NHS?
Finally, will Ministers please truly consult and work with disabled people? Decades ago, disability campaigners created the phrase “nothing about us without us”, but the publication and announcements for this Bill have destroyed whatever tiny amount of hope the disabled community had that this new Government understood disabled people and their lives. There is much rebuilding of trust to do.
Lord Sikka (Lab)
My Lords, I congratulate the noble Baroness, Lady Shawcross-Wolfson, on her excellent speech and welcome her to the House. I also look forward to my noble friend Lady Bryan of Partick’s valedictory speech. I thank her for her compassion and mentoring. When I first arrived in this House, she said, “You must faithfully follow all the signs and instructions”. The first sign I saw said “Keep left”, so I have been following that ever since.
The Bill before us is cruel. It started life as the Universal Credit and Personal Independence Payment Bill and morphed into the Universal Credit Bill. Without providing any evidence, Ministers said publicly that without cutting benefits to the disabled, the welfare system would actually collapse. Strange: no such argument is ever made when vast sums are handed out in corporate welfare. Billions of pounds have been handed out in subsidies and uncosted tax reliefs to banks, auto, steel, shipbuilding, oil, gas, biomass, water, rail, the internet and many other industries. No equity stake is acquired in return and no cost-benefit analysis is ever produced.
The Government said on 23 April 2025 that spending on welfare would be 10.6% of GDP this year, which is considerably below the OECD average. The National Institute of Economic and Social Research said earlier this year that the UK has some of the least generous welfare across OECD countries, yet here we are inflicting more harm.
The Bill still targets the disabled. There has been no assessment of its impact on the NHS, public services, local economies, families, people, and human dignity. The assumed financial savings are unlikely to materialise. I welcome the proposed £1 billion investment in employment support and a right to try but, after changes in the Commons, the cuts are still there to the amount of around £2 billion. This is a large amount and will devastate the lives of around 1.6 million disabled people by slashing the health element from £97 a week to £50 a week for those applying for universal credit after April 2026. That is a cut of £2,444 a year and will plunge millions of people into poverty. It violates any notion of equality by creating a two-tier society. Pre-April 2026 claimants will not really be safe, as their circumstances can change and they may well be classified as new claimants and lose what they are getting now.
No evidence has been provided to show that the government policy will deliver the assumed objectives, jobs and savings. The OBR will not publish its analysis until later this year. The Timms review will not begin until autumn, and we still do not have the full wording of the new eligibility criteria, and Parliament will not really be able to amend it, though it may be able to discuss it. Consultations were needed before proceeding with the Bill, but that has not been the case.
There is no shortage of money. For example, around £15 billion a year can be raised by taxing capital gains and dividends at the same rate as wages. Another £14.5 billion can be raised by standardising tax relief on all pension contributions at the basic rate of income tax, but the Government are choosing not to do that. We are all one serious illness or accident away from becoming disabled and needing benefits. None of us could live on the new level of reduced support for future claimants. The Bill removes hope and support for those who desperately need it. I regret that I cannot support the Government on this Bill.
Baroness Bryan of Partick (Lab) (Valedictory Speech)
My Lords, it is always daunting to follow my noble friend Lord Sikka. His depth of knowledge and of figures always amazes me. I congratulate the noble Baroness, Lady Shawcross-Wolfson, not only on her great pedigree in coming here but on her maiden speech. We are doing our bit for the numbers here, on the basis of one in, one out.
I thank your Lordships so much for all the very kind comments. I blush when I hear them, because I feel a fraud, giving a valedictory speech after only seven years in the House. That is just the blink of an eye compared with many Peers. Despite my short stay, I would like to put on record my thanks to those who have given me support while I have been here, many of whom are in the Chamber today. The doorkeepers have always been tremendous and, from my first day, given me their kind support. Some old friends among them have retired, while other stalwarts remain, and I have seen the professionalism of the newer doorkeepers. I thank them all.
I was honoured to be introduced by my noble friends Lady Chakrabarti and Lady Hayter of Kentish Town—two formidable women from whom I have learned a lot. It has been a particular honour to support my noble friend Lady Chakrabarti in her many attempts to protect human rights during the last Parliament. The most important person who helped me settle in and find my way around, both procedurally and geographically, was my noble friend Lady Gale. She was my unofficial mentor and remains, I hope, a good friend. I also remember that my first Whip was my noble friend the Minister, who was as gentle and supportive as any Whip can be.
However, I have never been reconciled to the unelected nature of the House of Lords. While I wish good speed to the Bill to abolish hereditary Peers, it will not change the fundamental problem of the imbalance in representation in this House. During my time on the Opposition Benches, I saw how difficult it was to pass amendments just to ask the Government to think again. Currently, the main opposition party can defeat the Government simply because, at times in the past, the Conservative Party has used its patronage to create more life Peers than Labour has. I believe that a second Chamber must be a check on the powers of the Executive, particularly when Members of the other place are unable to perform that role. But the basis for a second Chamber should be rooted in democratic accountability. The House has many Members who represent the great and the good, but it is not representative of or answerable to the people who are affected by the legislation it considers, including the Bill we are discussing. So I leave still committed to an elected senate of the nations and regions, and I will continue to write and campaign on that cause.
I turn now to the Universal Credit Bill. I thank campaigning groups for their briefing papers and the many individuals who shared their lived experience, which undermines the false idea that anyone can self-identify as disabled. I put on record my admiration for the many disabled campaigners who were successful in persuading the Government to accept that their first Bill was deeply flawed. I am proud to stand with the MPs who campaigned against both Bills, in particular the four Scottish Labour MPs who stood by their constituents and principles and voted against this Bill.
Despite the decision to consider the future of PIP in the Timms review, the Bill will have a devastating impact on those who need to claim the health element of universal credit. Last week, we saw levels of unemployment rise to a four-year high. Finding skilled, well-paid jobs is challenging for everyone; the slogan “those who can work, should work” is meaningless if employers are even less interested in making the adjustments needed to bring disabled workers into the workplace. Surely that is where the emphasis needs to be. Employers should have an obligation to make space in their workplaces for disabled people.
I hope the Minister recognises that the Bill was perhaps drafted in undue haste. In a debate in 2020, she said the very wise words:
“Occasionally, all of us in politics need to reflect that when we legislate in haste, we may repent at leisure”.—[Official Report, 3/9/20; col. GC 69.]
I hope that the Bill can wait for the publication of the impact assessments and supporting information, including the analysis of the Office for Budget Responsibility on the expected number of people moving into work as a result of these changes. It is likely that that analysis will show that many of the people affected will not be able to move into work; instead, they will be moved into greater poverty.
I look forward to hearing from my noble friend Lady Ritchie, who has been such a valuable Member of this House.
Baroness Ritchie of Downpatrick (Lab)
My Lords, it is an absolute pleasure to follow my roommate and noble friend Lady Bryan of Partick as she makes her valedictory speech today and says farewell to the Chamber. As my roommate in Room 14 on the 2nd Floor, West Front, along with our mentor and boss, my noble friend Lady Gale, and my noble friend Lady Chakrabarti, she formed a very good friendship with all of us. She is a good colleague and a hard-working campaigner for social justice, fairness and equality for all, and in particular for all the residents of Scotland. I hope that, outside this Chamber, she continues that work in whatever guise she decides.
I welcome the maiden speech of the noble Baroness, Lady Shawcross-Wolfson. She is very welcome in your Lordships’ House.
Moving on to the Bill, I welcome the Government’s decision to make concessions in relation to the original Bill with regard to PIPs and disabilities, as well as, on a separate basis, the winter fuel payment. As a former Minister with responsibility for welfare in Northern Ireland—under the principle of parity, the Bill will apply in Northern Ireland—I recognise that welfare is a very challenging issue and requires to be reformed, and that the financial bandwidth has been lessened due to the actions of the previous Government over 14 years and the existential threats posed by Brexit.
None the less, the concessions show a listening Government. But there is a little more that needs to be addressed, as has been referred to in this debate, in the many letters we have received via email and in the various submissions from disability organisations. I hope the Government will be able to lead, listen to the needs of the disabled and provide a solution with particular reference to the health element of universal credit for new claimants. I hope that those measures, which bring benefit to disabled people, will emerge from the Timms review, which will be co-produced with disabled people through listening to and working with them.
Many people have said to me that there is a fear in the wider community of a possible return to austerity. I would like assurances from my noble friend the Minister that that will not be the case and that the most vulnerable, who have faced disproportionate costs for heating and food over many years, will be protected by benefits uprated in line with inflation.
People still find themselves disproportionately affected by rising inflation and the ongoing cost of living crisis. The latest consumer prices index has spiked to 3.6% for June 2025, with the Bank of England predicting possible further rises due to higher food and energy prices. In such circumstances and in the context of the Bill, will my noble friend the Minister commit the Government to social security benefits uprating in line with inflation for those out of work and those in low-paid work? She provided me with some comfort some weeks ago in answer to my question when she stated
“the Bill says that we are guaranteeing an above-inflation increase to the UC standard allowance in each of the next four years”.—[Official Report, 2/7/25; col. 807.]
I hope that that will be the case, notwithstanding the challenges faced by the Treasury and the Government, and taking on board the increase in price inflation figures released some days ago. That is the issue for Advice NI in Northern Ireland, which represents many people in receipt of disability benefits.
I have a further question for the Minister. What if the move to universal credit takes longer to complete than by March 2026? Will anyone who moves from ESA to universal credit after March 2026 be treated as a new universal credit claimant and so be subject to the health element, which would mean a 50% reduction for new claimants? I am looking for some assurances. Therefore, can my noble friend the Minister indicate what the situation will be? None of us want to see people ploughed into endless poverty, disadvantage and financial loss while enduring their disability.
The Cystic Fibrosis Trust and the disability charity Scope, while welcoming the Government’s concessions, are concerned about the fluctuating nature of health conditions for new claimants. Therefore, can my noble friend the Minister outline what further measures could be provided to assuage the concerns around the health element of those potential new claimants for universal credit? Many disability conditions do not disappear with changes in social security regulations or legislation.
Baroness Scott of Needham Market (LD)
My Lords, I have a long-standing interest in ME—chronic fatigue syndrome—having seen at first hand its awful impacts on people’s lives. It is good to be able to say something this evening, because today we saw the publication of the long-awaited delivery plan on ME. It is very welcome to see that. The Ministerial foreword says that we need
“a better understanding of the condition”.
I think patients with ME would certainly agree.
For context, an estimated 400,000 people in the UK are living with ME, and around a quarter of those are disabled to the extent that they spend most of their lives in bed. The remainder have symptoms on a very wide spectrum. As we heard from the noble Baroness, Lady Brinton, it is estimated that around 381,000 people have serious post-viral symptoms that have lasted for more than two years as a result of long Covid. Long Covid is not the same as ME, but there are some similarities.
The sad truth is that for many people ME is a lifelong condition. Its severity and impact vary enormously, not just between individuals but for the same individual, both over the long term and as part of a pattern of symptoms in the short term. Flare-ups are common, relapses occur, and it is entirely unpredictable.
For claimants, that means tasks that can be completed on some days cannot be completed on others, or simply cannot be sustained. I had a look at the training module for assessors, which says, “This training will take you approximately 30 minutes to complete”. The training is not bad, but I suggest to the Minister that 30 minutes is wholly inadequate to train an assessor in determining the condition of someone who is presenting such a complex set of conditions.
The delivery plan, which I referred to, says that we need
“to ensure that … the right decisions are made the first time”.
Amen to that, but the briefing from Scope tells us that around 49% of universal credit decisions reaching appeal are overturned. I cannot help but wonder whether that is related to the level of training on the part of the assessors. It would be very good if the Minister could say a word or two about that.
From April next year, new claimants will get a reduced limited capability for work rate, even if they have the most severe form of ME. Although it is lifelong and often seriously disabling, because it fluctuates and has an uncertain prognosis, many people will simply fail the “severe, lifelong condition” criteria. Many will not reach the strict “no improvement expected” test and thus will be locked out of the enhanced support.
Current regulations refer to
“the majority of the occasions on which the claimant … attempts to undertake the activity”.
The new regulations refer to “all occasions”. That is highly problematic for anyone with a fluctuating condition. I am talking this evening about ME, but we have heard from many other organisations and from individuals who have fluctuating conditions.
Freezing for four years means that disability support will not rise with inflation while other basic costs such as food and energy keep rising. It is a fact that many ME patients carry on working—life is tough, but they do it—and there are many others who aspire to work. They want to recover enough to one day go back to work, but it is complex and unpredictable. Their general health and well-being are key if they are to get back to work. Being pushed into poverty by measures in the Bill and by other measures will simply further disadvantage people with this condition.
Although not in the Bill, there is consultation on removing the health element of universal credit for under-22s. That is causing widespread concern, particularly among families and carers of young people with ME. The median onset age for ME is 15.
I agree with the comments made by Steve Darling, my colleague in the House of Commons, that the key to achieving the Government’s aspirations for welfare reform is genuine engagement with the people affected. I say to the Minister that, from reading the briefings from the organisations, it is very clear there is a huge gulf between the picture that she has painted today and the understanding of the organisations, and, perhaps even more importantly, the testimony from many hundreds of people who are now desperately worried about what the future holds for them. We need collectively to do much better to offer them not just a financial leg-up but some reassurance that we have their back.
Lord Liddle (Lab)
First, in her absence, I congratulate the noble Baroness, Lady Shawcross-Wolfson, on a very graceful maiden speech. I say to the noble Lord, Lord Elliott, that if he goes ahead with the idea of having meetings of former heads of the No. 10 policy unit, I hope that I, as a mere humble member, might occasionally be invited. Secondly, I would like to say how much I will miss my noble friend Lady Bryan of Partick. We come from opposite ends of the Labour spectrum, but one thing we have in common is a great love of Keir Hardie, who is one of my great heroes. In the context of this debate, I remind noble Lords that his great campaign was for the right to work, not the right to benefits.
The Conservatives left us with a pretty dire situation on social security in 2024. We are going to talk today not about the triple lock, but benefits. We were spending £64.7 billion on incapacity and disability benefits in 2023-24, which was an increase of 40% in real terms since 2013—an increase, not a cut—and it has been forecast that this amount will go up to £107 billion through this Parliament. This is a massive £36 billion increase in five years.
One of the reasons for this is that the number of people receiving the health element of universal credit soared from 2.5 million to 3.7 million under the previous Government, a 1.2 million increase. As my honourable friend in the other place, Alison McGovern, said, it is obvious that the current system is not financially sustainable. The Economic Affairs Select Committee, of which I am a member, did a report on why this has come about. It could discover no adequate health explanation for the rise in the number of people on benefits. What was clear was that the DWP had stopped vetting people properly to receive this benefit. Whereas before the pandemic, seven out of 10 people were given a proper interview, that virtually stopped. The cost of that failure of the system is huge, and I do not think we can go on as we are.
There is another issue that I know is very difficult, but we have created a situation where people out of work on disability benefits are significantly better off than people who work—who flog their guts out on the minimum wage and receive universal credit. We have got the incentives for work all wrong, and this is politically unsustainable. I have spent much of my life campaigning for the Labour Party on council estates, going around the country representing people on three local authorities, all in areas with deprived estates. A situation where people are going out to work full time and seeing people on the opposite side of the street with a considerably higher income is not sustainable.
I support the central proposition of this Bill, which is to equalise universal credit, but it has to be combined with a very strong welfare-to-work programme. There is nothing social democratic or socialist in enabling a young person with mental health difficulties to go on to a lifetime of benefits. We have to move away from that. We have to have welfare-to-work programmes, as we did in the Blair and Brown Governments. That is the key to the future.
Finally, the other reason why we have to tackle the cost of disability benefits is that otherwise, we are not going to be able to tackle child poverty, which, for me, is a much bigger cause: it can lift families out of desperate poverty and enable them to have many more opportunities in life. This is the great cause to which a Labour Government should address themselves, and unless we deal with the problem of working-age disability benefits, we will never be able to afford it.
Baroness Smith of Llanfaes (PC)
My Lords, I will speak in the gap, if I may. I would like to congratulate the noble Baroness, Lady Shawcross-Wolfson, on her maiden speech. I look forward to her future contributions, particularly with her policy background. I also want to thank the noble Baroness, Lady Bryan, for her service to this House.
I support the regret amendment in the name of the noble Baroness, Lady Bennett, and I have key three key points to add to this evening’s Second Reading of the Universal Credit Bill. First, on Wales, the Joseph Rowntree Foundation calculates that there are almost 900,000 disabled people in Wales—around 30% of the population—with 26% of working-age adults self-reporting as being disabled. The DWP’s own Green Paper evidence pack shows that Wales will be disproportionately affected by any changes to welfare. It shows that 14.7% of the working-age population are on disability and incapacity benefits, the highest in the UK, while 20.4% of working-age people and 26.9% of working-age households in Wales receive universal credit. The Bill has also been highlighted by the First Minister of Wales as having a disproportionate effect on Wales. Will the Minister share with us what specific attention the UK Government have given to these disproportionate effects, and what discussions His Majesty’s Government will be having with the Welsh Government on the effect of this Bill?
My second point is that we already have a two-tier benefit system, and this Bill, as so eloquently pressed by other speakers, will worsen that. What I mean by that is that the two tiers already in existence are in relation to age. I will illustrate this briefly. Universal credit rates are 20% less if you are under 25, and the housing cost elements can be 45% less for those under 35 in some areas. There is a presumption here that all young people have parents or family members to support them, which is not the case. Practically speaking, the cost of food and bills is not, shockingly, cheaper for those who are, say, 24 years old compared to someone over 25. I ask the Minister: are those age rates something that will be addressed in the future? The noble Baroness, Lady Browning, also raised real concerns in relation to the gap in the welfare system for those with lifelong disabilities who are under the age of 22.
Finally, as a former unpaid carer, I would just like to add my voice to the calls for further clarity for unpaid carers under this new system.
Lord Davies of Brixton (Lab)
If I may, I will speak briefly in the gap, principally just to—
Baroness Anderson of Stoke-on-Trent (Lab)
My noble friend has not given notice.
Lord Davies of Brixton (Lab)
Okay. I just wanted to say thank you to my noble friend Lady Bryan.
Lord Palmer of Childs Hill (LD)
I thank the noble Lord. With speakers in the gap, you never know quite where you are.
My Lords, first of all, it is a great pleasure to welcome the noble Baroness, Lady Shawcross-Wolfson, and to compliment her on her maiden speech, as well as to compliment the noble Baroness, Lady Bryan, on her valedictory speech. The noble Baronesses enshrine the principle we have often noted in your Lordships’ House of “one in, one out”. This is a good example.
The Minister gave, as usual, a very good summary of the Government’s position, including the reasons for the removal of the PIP provisions from the Bill. A comment was made that she has been gentle and supportive, and I would comment from the Opposition Benches that I always find her gentle and supportive.
The noble Viscount, Lord Younger, made some interesting comments, including that the House will not be fooled. I thought that was very pertinent. He also said that the Government are running away from real reform.
My noble friend Lady Tyler drew great attention to the reduction of support for those with mental health problems, and to the involvement of carers, which has not been emphasised too much during this debate.
The noble Baroness, Lady Bennett, has her regret amendment, to which she spoke eloquently. If she moves to a vote, the Liberal Democrats will be supporting that. It is a welcome relief in a money Bill to have an opportunity to vote for anything—and this is not just anything but something worth voting for.
The noble Lord, Lord Elliott, made some points about decent jobs and giving a carrot to employers. That is an interesting aspect, which has not been discussed in the Bill. He also raised something that I did not know about ex-servicemen’s relief, which is something to be borne in mind.
My noble friend Lady Brinton gave a good clarification on PIP during her comments.
There needs to be reform of the welfare system, but this Bill is not the way to do it. On its way to this Chamber, the Bill has been described by others, including my noble friend Lady Tyler, as shambolic. There is not enough linkage between the NHS and the care system. There are still people stuck on universal credit because they are stuck in an unresponsive NHS.
From April 2026, the health element for new universal credit claimants will be cut, from £97 to £50 a week. As was drawn attention to by the noble Lord, Lord Sikka, that means a loss of £2,444 per year. This will push hundreds of thousands into deep poverty, stripping away legal protections and forcing people to choose between food and essential medication.
The consequences are clear: spiralling hunger, mental health crises and suicide. These changes will destroy lives. Only one in nine claimants who would currently receive the full limited capability for work and work-related activity support will qualify under the proposed severe conditions criteria; that is, just 200,000 people.
The SCC introduces four new harsh eligibility hurdles. First, there is the finding of unfitness for work and work-related activity. Secondly, it specifies an NHS-only diagnosis, excluding private specialists, which is a trip into the old world. People are not using only the NHS, so why exclude private specialist diagnoses? Perhaps the Minister could explain that. Thirdly, there is the hurdle of a lifelong condition. Fourthly, symptoms must meet Schedule 7 descriptors constantly and not episodically.
These requirements structurally exclude and discriminate against people with fluctuating conditions, such as multiple sclerosis, schizophrenia and Parkinson’s. They punish those stuck on NHS diagnostic wait lists, some for more than a decade. My noble friend Lady Scott drew attention to ME as a long-standing symptom, but it is one of many.
The Bill also scraps ESA Regulation 35(2), a vital safety net that protects people from being forced into unsafe work where there is substantial risk of harm or suicide. The safeguard is applied only when clinicians provide serious evidence of the danger, and its removal is reckless. Coroners’ prevention of future death reports have repeatedly warned of tragic outcomes with such protections missing.
No one has really talked about whether the Bill will now save money. I quote Helen Miller, the deputy director of the IFS:
“The government’s original reform was set to save £5.5 billion in the short run … and double that in the long run when fully rolled out. Without reform to Personal Independence Payment, the watered down bill is expected to deliver essentially no savings over the next four years. This is because over this period the forecast savings from reducing the Universal Credit (UC) health element for new claimants … will be roughly offset by the cost of increasing the UC standard allowance”.
This is typical of the Government and just like the winter fuel allowance. We understand why the winter fuel allowance was cut but, with people claiming additional benefits, the monetary benefit of removing it was not there. History is repeating itself.
This is a money Bill and our formal powers are limited, so I put it in simple terms to the Government—four very simple points. First, they should recognise that the exclusion of fluctuating conditions is unfair. Can the Minister answer that? Secondly, the change to require NHS-only diagnosis and treatment is also unfair. Thirdly, we should defend the protections of those at substantial risk. Fourthly, where is the engagement with carers’ organisations, as referred to by other Peers?
From these Benches we call for revision to the severe conditions criteria and the restoration of essential safeguards, which will help future legal challenges and put disabled people’s voices and lived realities on the record. This is a faulty Bill, and it should not even be here.
Baroness Stedman-Scott (Con)
My Lords, I thank the Minister for her introduction to the Bill and for the ability to speak openly to her in the lead-up to today. I completely agree with the Minister that benefits should be easy to access for those who are in genuine need and difficult—even impossible—to access for those who are not in need.
I warmly welcome my noble friend Lady Shawcross-Wolfson to your Lordships’ House and congratulate her on her maiden speech. I have no doubt that my noble friend will make a significant contribution to the work of this House. The strength of that contribution was clearly understood today. My noble friend and I spent many interesting times in the DWP debating the merits of changes to the Child Maintenance Service with our own other noble friend Lady Coffey.
I wish the noble Baroness, Lady Bryan of Partick, well as she leaves your Lordships’ House. I thank her for her service and can confirm 100% that the noble Baroness is no fraud.
I want to focus your Lordships’ minds on the realities facing millions in this country and on the striking absence of ambition in this Bill. I will summarise the issues I believe the Government should address and attempt to solve, and where they ought to have begun before embarking on this legislation. I have always tried to be balanced and measured in my approach to this subject matter, and today will be no exception. I want to discuss the facts, which are important. We should be straightforward about them because, in discussing and debating them, we might get some solutions that benefit the people we exist to serve.
First, I was surprised that there is nothing in the Bill that addresses the deep-rooted challenge of long-term benefit reliance. People have always depended on the state when they see no other path forward. I was delighted that my heart was beating in concert with that of the noble Lord, Lord Liddell, when he talked about it being outrageous that people should get more on benefits than they would if they went to work. There are people who say, “Why should I work when I can get this?” The other day I was with somebody who works goodness knows how many hours a week. He told me that his friend, who is on benefits, was on Brighton beach. I suppose that is legit. When she went for a benefit assessment with her doctor, she used to put thick mascara around her eyes and Vicks underneath to make herself cry. Well, it worked. We should not have those sorts of things.
There is nothing in the Bill for those who have tried and failed; for whom interventions and standardised work programmes have never worked. Some people have been on every government programme that has ever been devised and delivered, but, to our shame, they still remain out of work. In one area of the country, they call these people their “beached population”, because they are completely held out of work by various conditions, or simply a lack of opportunity.
The right reverend Prelate the Bishop of Newcastle made a very good point that we cannot standardise things. One size does not fit all, and having flexibility in the service we offer people is going to be really important. I note the points made by the Minister on PIP assessments. I congratulate her on the commitment to do them face to face. The only reason that face-to-face assessments were stopped was Covid, and I am glad that they are coming back.
We must do better, especially for those living with disabilities and battling severe conditions every day. I recognise the Government’s progress on the Conservative principle of the right to try and welcome recent investments in skills, but without real, personalised, wraparound support, these efforts will continue to fall short for some people who need them. I have had loads of emails, as I am sure other noble Lords have, from people concerned about the impact on disabled people. I completely agree with the noble Baroness, Lady Grey-Thompson, that the media have not helped one little bit in the way that they have frightened people into believing that certain things will happen, when maybe they will not.
Why can we not offer real choices and a sense of purpose to those who have never truly had one—a point well made by my noble friend Lady Browning. Where is the choice for the choiceless? I thought that the noble Baroness, Lady Bennett, had pinched my speech, because we were sharing those words, so we are at one on that. I am very happy to confirm that the family the noble Baroness told us about should get the help that they really do deserve.
Secondly, our labour market is faltering. The most recent figures show that payrolled employees have fallen by 0.6% on the year, vacancies are down by 63,000 in the last quarter and the universal credit claimant count rose again in June to 1.743 million—up on both the month and the year. Yet this Bill offers no road map or plan to reverse the trend.
The West Midlands and London, two of the most populous and diverse economic regions, have experienced some of the weakest labour market recoveries. The constituencies with the highest universal credit claimant rates dominate the top of the list. This is no coincidence. The data reveals a stark truth: high claimant rates correlate directly with underperforming local labour markets. Jobs created are either out of reach or out of sync with the people who need them most. Nothing in the Bill seeks to address this reality. Where is the effort to connect talent to opportunity? Where is the connection for the unconnected?
We also know that adult education and skills training are the key to unlocking potential but, for too many, those doors remain shut. Whether it is basic maths and English or technical qualifications, acquiring skills later in life is profoundly difficult. Even when the financial support is there, awareness is lacking. Claimants are struggling to find tailored practical pathways that fit around the daily grind. Nothing in the Bill seeks to address this reality. Where are the accessible education opportunities for those who need them most? Where are the education opportunities for the forgotten?
In my 32 years of helping people into work, I—like all noble Lords—have seen the battles people face, the demons behind closed doors and the slow grinding effort required to turn lives around. Although the Government can do a lot, they cannot do it alone, and neither should they. Civil society must meet the challenge with urgency, and very often they are the best people to engage with the people we are talking about and trying to help this evening. What we need is not another scheme; we need belief and commitment. We need to support people who walk life’s tightrope every day, to keep them in work—not just for their finances but for their sense of purpose. Nothing in the Bill seeks to address this reality. Where is the direction for those who need it most? Where is the hope for the hopeless?
Nowhere is this more critical than with our young people, especially those who are NEET. This is a group that I and others in this House have worked with very closely, and I am sure we all care deeply about it. Today, over 800,000 young people in the UK fall into this category, and that should be a shock to us all. It should stir us into action—a point well made by the noble Lord, Lord Rook, who mentioned one of my favourite organisations: the Salvation Army. It was William Booth who set up the first labour exchange; the Government nicked the idea, and today we have Jobcentre Plus. Behind that number are real lives—real young people who were told to work hard, go to school and go to university. They did, but they now find that promise broken. How will the Government stop young people becoming NEET in the first place?
Graduate jobs are also vanishing as AI and automation reshape the economy. Up to one-third of traditional graduate roles are expected to disappear. These young people are not lacking in ambition; they are simply not being met with opportunity. The consequences are severe: studies show that time spent NEET leads to worse mental and physical health and a greater likelihood of unemployment or poor-quality work for years to come.
Consider the broader economic picture regarding inactivity. The UK inactivity rate for working-age adults is now 21%. Some 37,000 working days were lost to labour disputes in May alone. We face a softening labour market, falling payroll numbers and growing economic disengagement. At the moment, the Bill does nothing to respond to this. My noble friend Lord Elliott made the point that it is only employers who create jobs. Nobody else does that. You cannot buy jobs; it is only employers who create them. We need to work with employers to make sure that those jobs are created. Even I cannot offer the Minister the offer that my noble friend made, so if I were her I would grab it quickly. Meanwhile, we are told that the Bill delivers value, but the Institute for Fiscal Studies has shown that there are no net savings—yet we still plan to spend £2.2 billion immediately. Where is the fiscal prudence in that?
Hanging over all of this, our welfare bill is forecast to exceed £100 billion by the end of this Parliament. Our national debt, enormous in size, is even more concerning in composition—much of it inflation linked, meaning that prices rise directly and raise the cost of our repayments. This is a dangerous fiscal position. As my noble friend Lady Shawcross-Wolfson said, we cannot borrow, and we cannot borrow our way to opportunity. We need growth and reform and, above everything else, people in work. We will not reduce the bill until we reduce the dependency; that is the fundamental truth at the heart of this debate. We must win the argument that an ever-expanding welfare budget is not an act of kindness—it is a form of cruelty. It traps people, robs them of dignity and hollows out society’s productivity.
The Government, through the NICs Act—I know that it is a sore subject—have taxed work at the expense of people and of what employers are able, or now not able, to do. We need a new vision, one rooted in belief, backed by action and committed to the conviction that everyone deserves the chance to thrive through work. Many may ask, “What does that matter to me?” The answer lies in the long-term health and balance of our economy and of the people impacted. We risk drifting towards a situation where the welfare state outpaces the economy that sustains it—a point made by the noble Lord, Lord Palmer of Childs Hill. A fair and sustainable system depends on a strong workforce and a thriving labour market.
Britain needs people like us who will speak plainly about the scale of the challenge, and many in this Chamber are doing that. Your Lordships’ House knows me well, and I will continue to speak for the voiceless, the choiceless, the hopeless and the workless, and I know that noble Lords will all join me in that. I will continue to challenge the silence in this Bill and continue to fight with noble Lords for a future where work is not only possible but purposeful.
Baroness Sherlock (Lab)
My Lords, I thank all noble Lords for their contributions this evening. It has been a really interesting debate. I particularly thank the noble Baroness, Lady Shawcross-Wolfson. What an astonishing story and what an incredible heritage. I can only think that her forebears must be so very proud of her. It is a real joy to have her here with us today.
I thank my noble friend Lady Bryan. It was a privilege to be her Whip. I cannot say that I was always successful in persuading her of my point of view, but it was an absolute delight to work with her and we will miss her very much. I know that retirement for her will not mean walking away from the cause of social justice; indeed, she may be the first person to leave the House of Lords to spend more time in politics. We thank her for her contribution and we hope that she stays in touch.
Before I turn to the specific points raised, I say from the outset that this Bill is simply one part of the Government’s wider programme to reform our social security system so that it is sustainable and helps people to build a better life. That is what it is there to do, but it is part of a much wider programme. Let us bear that in mind as we go through.
Let us look at the specifics. I will try to talk on as many points as possible, but in 20 minutes I will not get to them all and I will not name everybody. I apologise in advance.
On the comments from the noble Baroness, Lady Bennett, the right reverend Prelate the Bishop of Newcastle, and others that the Bill pushes people into poverty, let me be clear that nobody will find themselves pushed into poverty as a result of the changes in the Bill. People who are claiming benefits are not going to be subject to these changes. As I said at the start, we estimate that the benefits changes announced at the Spring Statement, revised to account for changes in the Bill, will now lift 50,000 people out of poverty in 2029-30. That is without any impacts of our record £3.8 billion investment in employment support. It is absolutely the case that those who qualify in future will get a higher standard allowance in universal credit and will still get a health top-up in universal credit, albeit at a lower level than now, as a result of the rebalancing. They will also get much more support in their journey towards work.
As for those with the highest needs, we recognise that some people will never be able to work. That is why those with the most severe, lifelong conditions whom we do not ever expect to be able to work, and those nearing the end of their lives, will receive the current higher rate of health top-up when they apply, and we will not be calling people in for pointless assessments.
My noble friend Lord Rook and the noble Baroness, Lady Stedman-Scott, focused particularly on young people. We have a special responsibility to make sure that nobody is written off before their adult life even begins. That is the basis of our new youth guarantee, to ensure that all 18 to 21 year-olds can access quality training opportunities, an apprenticeship or help to find a job. That will include targeted support for, for example, young people with learning disabilities. Our youth guarantee trailblazers are already doing brilliant work, testing and delivering new ways to help young people. We are working in partnership with all kinds of organisations, including the Premier League, Channel 4 and the Royal Shakespeare Company, to engage and inspire young people on their journey towards work. Perhaps the Salvation Army needs to be added to that list now—I can take a hint from both Benches.
My noble friend mentioned mental health. I reassure him that we are expanding mental health support teams, so that more schools can offer early, specialist help. All pupils will have access to mental health support in school by the end of the decade. Through the youth guarantee, we are improving access to mental health services for 18 to 21 year-olds.
A number of noble Lords mentioned the proposal we consulted on in the Green Paper, which is not part of this Bill, as to whether we should delay access to the health top-up of universal credit until someone is 22. I make no apology that we have to explore every option to make sure that young people are making the best possible start to their adult lives. However, there was a consultation. No decision has been taken, nor will it be taken until we have had the opportunity to review responses to the consultation. I reassure the House that, if we decide to go ahead with that, the savings will be reinvested in training and work opportunities for that age group and we will consider carefully what special provisions are needed for those young people for whom the youth guarantee will never be a realistic option.
I heard the comments of my noble friend Lord Hendy and others about the questions raised by the UNCRPD. I say to the House that we take our international obligations seriously. We have had a letter, we are considering the issues raised and we will respond in due course.
The noble Baroness, Lady Grey-Thompson, made some very important points about the way we debate these questions. I share her concern that the narrative can become regrettable and focused in ways that are just not helpful to the debate, never mind to the individuals. I reassure the noble Baroness, Lady Brinton, that my honourable friend the Secretary of State—I know this because I know her well—does not believe that disabled people are work-shy and wants to give them opportunities to move into work. I want to see a much better debate all round. We have to find a way, as a country, to be able to discuss reform of social security without running into problems where either we are not able to discuss it or we are doing it in ways that cause fear and anxiety, which do not need to be there. I hope we can all work together to find ways to do that.
I was shocked to hear of the website described by the noble Baroness, Lady Grey-Thompson, identifying Motability users. We have checked and the Motability Foundation has confirmed that no data was provided to the developers and any information returned is not accurate. I am glad that the website has been taken down, but the bottom line is that that should not be happening. That is not what this is about. It is shocking.
I agree with the noble Baroness that we need to make sure that we regain trust among those who use our services. A couple of noble Lords made points on this. We made clear in our Green Paper that this is our mission. We announced that we are reviewing our entire safeguarding processes and strengthening our clinical governance. I say to the noble Baroness, Lady Scott of Needham Market, that that includes the training of assessors, because we want to make sure that we get this right. A lot of time and effort is being invested in this and we have some really good people from the clinical side who are working with us internally in doing that. I am glad that the noble Baroness found the training helpful, even if it was not as long as she would want it to be. We are moving to bring back face-to-face assessments and will record them as standard. We think that those things taken together will help make a difference to the way the assessments happen and are perceived.
The noble Lord, Lord Elliott of Mickle Fell, touched on the challenge of making sure that the right jobs are there in the first place, and he is absolutely right. We are creating good jobs across the country, including using our modern industrial strategy and investing in such things as clean energy. However, our local Get Britain Working plans are based on the recognition that we do not have a single labour market in this country but a number of different labour markets that depend on local conditions.
I say to the noble Baroness, Lady Stedman-Scott, that this Bill does what this Bill does. If she wants to find hope and opportunity, she should go out there and look at Get Britain Working, the inactivity pilots, our youth guarantee pilots, and the independent review that we have commissioned from Sir Charlie Mayfield, former boss of John Lewis, into what employers can do to create inclusive workplaces where people can stay in work and not fall out of it when they hit health problems. There is a huge amount going on beyond this.
I take the point from the noble Lord, Lord Elliott of Mickle Fell; he is not the first person to make it to me. I will share it where it can best be used. We want to find ways of making sure that there are jobs there for people who want to get into them and that we can support them to do it.
Fluctuating conditions were mentioned a lot. This is an area where there has clearly been some confusion. Let me clarify for noble Lords who are not familiar with this that the work capability assessment is not specific to a condition; it is based on the impacts of a condition rather than the condition itself. Some conditions will have different impacts on different people or at different stages of a person’s life. The assessment includes provisions to ensure consideration of how someone’s condition might fluctuate, hence the use of the terms “reliably” and “repeatedly” in some of the descriptors. This Bill does not change that. The idea that we have somehow changed that through using the word “constantly” is not the case. In some of the descriptors embedded in legislation, the concept of fluctuation in a condition is explicit within the use of those terms “reliably” and “repeatedly”. The bottom line is that, if a person cannot repeat an activity within a reasonable time, they should be considered unable to complete the task at all. I hope that is reassuring.
The severe conditions criteria are existing criteria which we are now going to use to determine who gets the higher, protected amount of health top-up. The wording in the Bill reflects how the functional tests are applied at present, and those tests take account of fluctuations. The healthcare professional has to look at how someone can undertake a task; if they cannot do it reliably and repeatedly, they should be assumed to be unable to complete it at all. I hope that provides reassurance.
NHS diagnosis came up a couple of times, so I would like to take the opportunity to clarify this. To meet the severe conditions criteria, the condition needs to be recorded somewhere in the NHS, following a proper clinical investigation and a formal medical diagnosis in line with NHS best practice. That does not mean the initial diagnosis has to be done by the NHS, but it has to be recorded somewhere in the NHS system. For a person who has a severe, lifelong health condition, their diagnosis will be in their GP record, even if it was made privately. I hope that helps reassure noble Lords.
A number of noble Lords raised the issue of unpaid carers. I once again put on record how much the Government appreciate their work and contribution. The increase to the UC standard allowance will benefit around a million unpaid carers. For any carers currently getting the universal credit health top-up, this Bill will not change that. My noble friend Lady Andrews and the noble Baroness, Lady Tyler, gave me a strong challenge on the review of PIP being co-produced with disabled people and other stakeholders. I reassure them that that will include carers’ organisations, so the voices of unpaid carers will be heard in that process.
On the two-tier system—I hate this phrase anyway, for all kinds of reasons that will be obvious—it is really common in social security when you make a significant change that some people on an existing system will stay on the old terms. Take the example of the limited capability for work premium in universal credit, which the last Government changed in 2017: people who were getting it then are still getting it today and will carry on doing so. There are only two ways to do this: either you change it overnight for everybody or you allow those already getting something to carry on getting it for a time while you change it. We cannot have both no two-tier system and no cliff edge. All this is doing is allowing people who have already got used to this to carry on with it, and adjusting it, which is the right thing to do.
The noble Viscount, Lord Younger, asked for details on exactly what the employment support will be. I do not have time to go into this now, but I reassure him that we are scaling up fast, with £600 million in 2026-27. The support we are delivering includes Connect to Work, WorkWell, nine inactivity trailblazers and access to 1,000 pathways to work advisers. I assure him that anyone affected by the reduction of the UC health top-up will be offered work, health and skills support through an adviser.
A number of noble Lords talked about the challenges we are facing in the system. It is true that making our social security system sustainable is a real objective for this Government, as it must be for every Government. That needs action on various fronts. It needs action to reduce the drivers of ill health, as the right reverend Prelate the Bishop of Newcastle said. It needs action, which we are doing, through our record levels of investment in and reform of the NHS. It needs investment in jobs in poor areas and in employment support, all of which we are doing at scale. It also needs reform of the benefits system, which we are committed to doing.
In response to the noble Viscount, who wants everything to have happened yesterday—even though I am not sure that characterised his Government’s period in office—for reforms of this scale, we need as far as possible to take people with us. I want these reforms to last for generations to come, because I want the welfare state to last for generations to come. Let us try to get this right, work together and be sensible about change. The real prize here is long-term reform and that is what we are shooting for.
A couple of noble Lords asked whether we are still saving money. Obviously, the removal of the PIP measure from this Bill will come with a cost, but the updated impact assessment shows that the Bill will still deliver some savings by 2029-30. However, the OBR will certify these as part of its next economic and fiscal outlook.
My noble friend Lady Ritchie asked what would happen to people on ESA. Existing claimants and anyone declaring a health condition before 6 April next year, and who become entitled to LCWRA because of that declaration, will get the higher rate. That includes claimants who currently receive income-related ESA and migrate to universal credit with no break in their claim. I hope that reassures her on that point.
The noble Viscount, Lord Younger, asked about fit note reform. It is not working, so through interventions such as WorkWell, we are testing different approaches to the role it can play as part of a joined-up work, health and skills system. He also asked about the right to try regulations; we aim to have those in place before April 2026. I hope that reassures him.
The noble Baroness, Lady Smith, asked about the position in Wales. Obviously, we published impact assessments that looked at Britain as a whole, because UC is reserved in Scotland and Wales, so the policies are not specific to a country—but I take her point. The Department for Communities in Northern Ireland has published detailed impact assessments as well. In response to her comments, we want to make sure that the positive changes in the Bill make a difference as far and wide as possible, but I stress again this Bill is only about the changes I have described so far. Some of our wider programmes are devolved and some are reserved, and we are absolutely committed to engaging closely with the devolved Governments to make sure we join those up, so that the benefits will spread across Wales as well as other parts of the United Kingdom.
I hope I have addressed as far as I can the points made about the impacts. On process, I know noble Lords do not like it being money Bill. I am sure noble Lords know that this was not the Government’s decision. It was a decision made by the Speaker of the House of Commons, on the advice of the authorities. I can only say to noble Lords that if Governments chose to make Bills money Bills, I suspect in all cases we would see an awful lot more of them. But this was not the decision of this Government at all.
I cannot pick up all the points that were raised. Let me say that we have published impact assessments; we are confident that the Bill complies with the Equality Act 2010; and we have engaged, and will continue to engage, with disabled people and their organisations. To be clear about the process on the Timms review, we expect it to conclude by autumn of next year and we are absolutely committed that it will be co-produced with disabled people and others to ensure that a wide range of views and voices are heard. We have already started, and will engage widely over the summer, on the details of the process and co-production. The review is reporting to the Secretary of State, but she has committed to reporting its findings to Parliament, so they will be coming here.
I hope I have addressed as many of the points as I can in the limited amount of time. I want to say a couple of things. One is that I am not ashamed to be part of a Government who listen, even if people have to shout quite loudly. Sometimes, we have to find ways of listening as carefully as we can. One of my noble friends suggested that you legislate at haste and repent a leisure. Well, we have had plenty of time to reflect on how we shape this Bill in the first place and I am really happy with it.
However, I want to stress the Bill has two parts. The PIP discussions will carry on, in the context of the Timms review, but this half of the Bill is about reforming universal credit, and that is absolutely worth doing. It is a prize worth having and we have to carry on with it. I am really proud that we have been able to push ahead and look at these details. The real difference is going to be made in the lives of people on the ground, in their engagement with our work coaches, the various services we can provide and the programmes we refer them to. We are trying to invest in getting people’s lives to be better.
In the end, we have to hope. We acknowledge that there will be some people who will never be able to work, and they should be supported. But there are plenty of other people who could have the opportunity to work if we could give them the right support and make sure they had the confidence to try a job; if we can get employers to listen and to take them seriously, and to want to bring on people with a history; if we can provide them with the skills or health support they need. We are setting out to join up all those things. For far too long, they have been separate. We have to join up health with skills, education and social security. If we can do that, the prize is enormous.
I do not want to write off people at 18. I do not want to write off people who have been given benefits for 20 years but nobody comes near them to offer help—that is not how I want it to be. I have heard the concerns around the House from different quarters and from all directions, and I understand that people worry about this. I very much hope that when not only this Bill but the Government’s programme of reforms get under way, people will begin to see that we really can make a difference—and that is a prize worth having.
Baroness Bennett of Manor Castle (GP)
My Lords, I thank the Minister for her typically comprehensive response within the limits of the time available. I thank everyone who has contributed to this extremely rich debate.
Your Lordships’ House has done what we can within the limits of the procedure allowed us, and I particularly note the highlights of the maiden speech and the valedictory speech. However, this debate has inevitably left many questions unanswered. The noble Baroness, Lady Lister, noted that what we heard from the Minister today and what we heard in the other place do not square with what is actually in the Bill on constant and continuing. Had we had further stages of the Bill here, we would have been able to explore that at depths that we simply have been unable to do today.
I note the equality points about age, raised by the noble Baroness, Lady Browning; about gender, raised by the noble Baroness, Lady Brinton; and about nations, especially Wales, raised by the noble Baroness, Lady Smith—and we did not even get into the regions of England. A particular highlight was the strong and powerful contributions of the noble Baronesses, Lady Grey-Thompson and Lady Brinton, in which they attacked some of the disgraceful stigmatisation and victim blaming that this debate has almost been free from, with a couple of exceptions. We have seen far too much of that in the public debate and in the other place.
The issue of finances is still hanging. The noble Lord, Lord Hendy, rightly pointed out that the justification for the Bill, when we started, was to cut government spending. The noble Lord, Lord Sikka, highlighted that we really have no idea what impact the Bill will have on raised costs for the NHS, social care, local councils and lots of other people. I should declare that I am a vice-president of the Local Government Association.
On jobs, the noble Lord, Lord Elliott, said that we need to do more to encourage employers. I am afraid that I am with the noble Baroness, Lady Bryan, in thinking that employers should provide jobs, ensure that those jobs are open to disabled people and make appropriate accommodations.
The right reverend Prelate said a very powerful phrase: we have to embrace those who do not fit the model of financial productivity. People can contribute to our society in many ways. The noble Baroness, Lady Stedman-Scott—I am sure that she did not mean to say this—spoke about a sense of purpose coming from paid work. I am sure she will acknowledge, as all sides of this House have acknowledged, that there are people who will never be able to take paid work, but those people’s lives can still have a sense of purpose. They can still contribute to communities—through caring and through volunteering—if they get the appropriate support.
The tone of this debate has very much been one of regret. The people listening to this debate need to hear as much support as they possibly can, so I beg leave to test the opinion of the House.
Baroness Sherlock (Lab)
My Lords, social security is transferred in Northern Ireland, but there is a long-standing principle of parity between the social security systems of the Northern Ireland Executive and the UK Government. We want to ensure that Northern Ireland will also benefit from these important changes, and have included provision for Northern Ireland, engaging with the Department for Communities in the usual way regarding legislative consent.
The Northern Ireland Minister for Communities has been clear that, although the Northern Ireland Executive disagree with these reforms and therefore did not put forward a Legislative Consent Motion, it is not feasible or affordable for the NIE to diverge from the UK Government. Reluctantly, the UK Government have therefore decided that there was little choice but to proceed without consent from the Northern Ireland Assembly. This is not a decision that the UK Government have taken lightly, nor does it indicate a general change in our commitment to the Sewel convention. We will continue to engage closely with the devolved Governments as we move forward, including on the Timms review.