House of Commons
Mr Speaker
Before we start today’s business, I welcome in the Gallery Her Excellency the President of the German Bundestag.
Oral Answers to Questions
(1 day, 5 hours ago)
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Dr Danny Chambers (Winchester) (LD)
Christine Jardine (Edinburgh West) (LD)
The Secretary of State for the Home Department (Shabana Mahmood)
Under the previous Government, net migration hit record highs after they lowered entry requirements and opened our borders. My definition of what is best for the UK economy is one where migration is controlled and where there is investment in skills and training for our home-grown workforce, not an overreliance on overseas recruitment.
Dr Chambers
I thank the Home Secretary for her response. We have 104 different nationalities working in Winchester hospital, throughout Hampshire over one third of the workers in the social care sector are born outside the EU, and we know statistically that we are more likely to be cared for or treated by an immigrant than we are to be waiting behind one for a GP appointment. Does the Home Secretary recognise that the current visa rules for healthcare workers are driving away many of the people who are keeping our NHS and social care services running?
Shabana Mahmood
No one disputes the tremendous contribution that international workers make to our NHS. The picture the hon. Gentleman describes is replicated in constituencies across the country, and we will always welcome that contribution. Overseas recruitment in the NHS is falling primarily because the NHS is leading by example and doing what we want all employers to do: look first at domestic recruitment to ensure that the skills and expertise of the health service are home-grown. I believe that those two systems can go hand in hand, but we have to make changes at the same time.
Christine Jardine
Hospitality, social care and the tech sector are all vital sources of employment and economic stability in my constituency. The companies in those sectors are telling me that, despite their efforts to recruit domestically first, the Home Secretary’s changes to indefinite leave to remain are making it very difficult for them to attract the skilled workforce from abroad that they need to keep the sector going. Will the Home Secretary reconsider the changes in the light of that impact and lighten the regulations to make it possible for these companies to survive?
Shabana Mahmood
We have to remember that currently in our country we have more than 1 million young people who are not in employment, education or training, and the hon. Lady and all Members should want us to turn that around and make sure that there are employment opportunities and a positive economic future in their own country for those young people in many of the sectors that she describes. We are the Government who have formalised that link between migration and skills reforms to make sure that companies are investing in the domestic workforce first and foremost before recruiting from abroad.
Dr Rupa Huq (Ealing Central and Acton) (Lab)
It is a fact to be proud of that four of the world’s 10 greatest universities in the global rankings are in the UK, including Imperial College London’s White City campus in my constituency. We punch way above our population weight and our universities are genuine engines of growth. However, evidence shows that the withdrawal of the post-study work visa coupled with the rumours about changes in indefinite leave to remain are driving some of those brightest brains who have produced such statistics to competitor countries. Will my right hon. Friend meet me, education Ministers and my two vice-chancellors to thrash out a solution? There are real problems, but we do not want to scare off genuine innovators and wealth creators.
Shabana Mahmood
This Government have increased routes at the very top end of the skills spectrum, such as through our global talent visa, to make sure that we are attracting talent from all over the world. We have a good track record in doing so and will continue that. There is work to do with our university sector to make sure that students recruited to this country are on good courses and making a contribution, and obviously we want to make sure that we use the best of that global talent in the future. The changes we are making are not about students—students do not come to attain indefinite leave to remain in our country—but for other parts of the migration system. I will make sure, however, that my hon. Friend gets a meeting with the migration Minister, my hon. Friend the Member for Dover and Deal (Mike Tapp) to discuss these matters in more detail.
Mr Jonathan Brash (Hartlepool) (Lab)
In Hartlepool we are reversing 30 years of globalisation and taking advantage of the unprecedented falls in immigration, thanks to this Home Secretary, and training our own, whether through our Health and Social Care Academy, our civil engineering academy, our centre of excellence for welding or our nuclear trades academy. Does the Secretary of State agree that rather than seeing it as an economic threat, falling immigration is an economic opportunity to train our own?
Shabana Mahmood
My hon. Friend is absolutely right. At a point when we have over a million young people not in employment, education or training, it is imperative that we make progress in this area. We would be letting our young people down if we did not take this opportunity to ensure that we are investing in our domestic skills workforce. That is a cross-Department priority and the Home Office is playing its full part.
Katie Lam (Weald of Kent) (Con)
The latest estimates indicate that 627,000 non-EU migrants, mostly from low-income countries, came to the UK between December 2024 and December 2025. Meanwhile, 61,000 Brits aged 16 to 24 left the UK, as did another 65,000 aged 25 to 34. In recent years, for every young Briton who has been employed, 27 young migrants from outside the EU have also joined the workforce. Does the Home Secretary accept that mass migration has wrecked economic opportunity for young people? How will that inform any changes that she makes to the immigration rules, given that almost two thirds of a million non-EU migrants came to this country last year?
Shabana Mahmood
The employment statistics that the hon. Lady has just used run from January 2020 to December 2025, so I congratulate her on exposing the track record of the Tory Government.
Douglas McAllister (West Dunbartonshire) (Lab)
The Minister for Policing and Crime (Sarah Jones)
There were several large-scale events in London on 16 May, the Unite the Kingdom rally being one of them. I had several briefings with the Met, who took a robust approach to the Unite the Kingdom rally, and I was in the control room on 16 May to see the operation for myself.
Douglas McAllister
What happens in our capital city has a knock-on effect across our entire country. My West Dunbartonshire constituent, Lindsey, contacted me to express her deep concern and shock at the abhorrent displays at the Unite the Kingdom rally. Participants openly incited racial hatred in inflammatory speeches but, more significantly, there were provocative Islamophobic stunts, involving mocking the religious dress of Muslim women. I understand those responsible were not arrested and I share my constituents’ disgust. Is the Minister satisfied with the Metropolitan police response? What future action will be considered to prevent a recurrence?
Sarah Jones
The Metropolitan Police Service maintained public order and kept Londoners safe on a day when there was an unprecedented number of large-scale events. Some 43 arrests were made at the Unite the Kingdom rally and the Nakba 78: March for Palestine. In advance, 11 foreign nationals were prevented from entering the UK to speak at the event and were prevented by the Met from broadcasting to the event. Of course I understand the concerns that my hon. Friend’s constituent raises, but the Metropolitan police, with their 4,000 officers on that day, did a very good job.
Shockat Adam (Leicester South) (Ind)
Many in the Muslim community are feeling bewildered, besieged and beleaguered. When they exercise their democratic right to vote and the results do not go a certain way, they are accused of sectarianism. When they take to the streets to protest peacefully against genocide, they are accused of going on hate marches, all the while witnessing not one but two Unite the Kingdom marches, where there were open calls for their expulsion from this country, which are met with apparent indifference. What steps is the Home Secretary taking to protect the Muslim community from further alienation and what message does she send to those who incite hatred against them?
Sarah Jones
This Government are committed to tackling all forms of hate crime, including anti-Muslim hostility. We are actively seeking to ensure the safety and protection of all individuals and communities. The UK has a proud tradition of racial and religious tolerance within the law, and this Government are absolutely committed to building the strong and integrated society that we all want to see.
Naushabah Khan (Gillingham and Rainham) (Lab)
Last week, I met one of my constituents who had faced horrible racist abuse on the train home from people who had been on the Unite the Kingdom rally. As someone of mixed white and middle eastern heritage, she told me that for the first time she felt scared in her own country. Does the Minister agree with me that we have a responsibility to tackle racial division across our country and not to ignite the situation, and that when the leader of Reform UK takes to the airwaves in the aftermath of heightened racial tensions to tell the public that they must react with “pure cold rage”, it is people such as my constituent who pay the price?
Sarah Jones
My hon. Friend’s story about her constituent will not be the only one we hear about. I notice that Reform UK is quick to slam into the television stations as soon as something occurs, but its Members do not then come to this place to debate it in the normal way. Members of this House and those beyond have a critical role to play in building the strong and integrated society that we all want to see, one that is not fuelled by hatred and division.
Lisa Smart (Hazel Grove) (LD)
I think the Minister speaks for the whole House in thanking the Metropolitan police for policing riots and protests that go beyond the realms of what is legally appropriate or acceptable, and that should happen to everybody, whatever the subject of their protest. Does the Minister agree that the rules on donations to fund these rallies—one of the organisers of the rallies, Stephen Yaxley-Lennon, who has thanked his donors, is a prominent member of a political party—should apply to the organisers as much as they do to anybody involved in politics, and that those donations should be declared with the transparency expected by this House and my constituents? Does the Minister agree that anybody receiving money from domestic or foreign sources should declare it?
Mr Speaker
Order. I am not quite sure that that question relates to the policing of rallies. It is a very good question, but it is not one for today.
Mr Luke Charters (York Outer) (Lab)
The Minister for Security (Dan Jarvis)
We have launched a new £250 million fraud strategy focused on preventing fraud, protecting victims and strengthening enforcement. We are working closely with the City of London police to establish referral routes so that identity fraud victims can access identity repair services, and we will continue to develop guidance, tools and partnerships to help victims to recover quickly and to reduce repeat harm.
Mr Charters
Several of my constituents have had their identity stolen, leading to devastating consequences. A serving member of our armed forces had his house purchase delayed after his credit file was marked as a risk. Too often, identity theft is bundled into other offences such as computer misuse and not pursued at all. Having been a counter-fraud specialist, I know how widespread this issue has become. Will my hon. Friend meet me and campaigners to discuss the case for identity fraud becoming a stand-alone offence?
Dan Jarvis
My hon. Friend speaks with real authority on these matters. He will know that the theft of personal information is already criminalised in legislation, including the Fraud Act 2006, the Computer Misuse Act 1990 and the Data Protection Act 2018. To ensure that those laws remain effective, we commissioned an independent review of disclosures and fraud offences. The review has submitted its final report to the Government and will be published shortly. We will consider its findings carefully and what further action may be needed to strengthen our response to identity fraud. I am sure that the noble Lord Hanson will happily meet my hon. Friend.
Gregory Stafford (Farnham and Bordon) (Con)
At my constituency surgery on Friday, Mr De Mesquita spoke to me about his concerns that Report Fraud was not passing on to local police forces information about victims of identity fraud. Given that those victims are often vulnerable and likely to be victims of other crimes, will the Minister let us know what he is doing to ensure that Report Fraud is passing on to local police forces the details of victims of such crimes?
Dan Jarvis
I am grateful to the hon. Gentleman for raising that important point, and I assure him that I will raise it with the noble Lord Hanson, who leads on matters relating to fraud. I hope the hon. Gentleman acknowledges that the Government have invested £250 million in working with a range of different organisations to bear down on the levels of fraud that we are seeing. That includes law enforcement, GCHQ, banks, telecommunications and tech partners, and civil society. We have also invested £31 million in a new online crime centre. I will look carefully at the points that he makes and refer them to Lord Hanson.
Laura Kyrke-Smith (Aylesbury) (Lab)
The Parliamentary Under-Secretary of State for the Home Department (Mike Tapp)
Our immigration system must operate in a way that attracts the best and the brightest. Earned settlement will reward those who integrate and contribute to this country, with shorter pathways for higher earners and those in public service roles among others. We are carefully considering responses to our public consultation before setting out the next steps.
Laura Kyrke-Smith
Last month I joined a very generous community event at Herali, a much-loved Sri Lankan restaurant in Aylesbury, which is dependent on staff who are here on skilled worker visas. The proposed changes to ILR put many of my local residents, including Sri Lankans and Indians, in a very uncertain and difficult position. When they arrived, the clear path to settlement was five years, but now they do not know what to plan or hope for. That is equally difficult for their employers, whether in the care sector, nurseries or hospitality businesses such as Herali. Will the Minister tell me what reassurance I can offer to these skilled legal migrants, who are such an important part of our communities?
Mike Tapp
That sounds like a fantastic restaurant. As the Home Secretary has already laid out, there are around 1 million young people currently out of education, employment or training. We are creating a system that is firm, protects the economy, protects welfare from rising further and avoids more pressure on our social housing demands, and also fair, so that it encourages and rewards genuine economic contribution and integration. We have consulted and had 200,000 responses, and we are working on a final solution, which will be announced in due course.
Ben Obese-Jecty (Huntingdon) (Con)
Last week, the Government voted against my amendment to the Armed Forces Bill, new clause 5, which would have waived visa fees for the spouses and children of armed forces personnel and veterans. That was, of course, a Labour manifesto pledge—as it was a Conservative manifesto pledge— to ensure that the families of those who have fought to defend this country are allowed to reside here without being charged £3,229 per person just to remain in the country following service. I understand that the reason the policy has not been pursued is a Home Office issue, rather than a Defence issue, so will the Minister explain why it has not been progressed in two years? Could he give an update on whether the policy will be amended when the changes come out later this year?
Mike Tapp
I thank the hon. Member for his question—as a veteran, it is an important question, and I respect it. I am working with colleagues in the Ministry of Defence at the moment to deliver that important manifesto commitment.
Martin Wrigley (Newton Abbot) (LD)
The Minister for Policing and Crime (Sarah Jones)
As with all new technology, decisions about procuring and using AI are a matter for operationally independent chief constables. The Home Office is supporting the police to adopt AI rapidly and responsibly, with £115 million of investment over the next three years. That includes investing in the national centre for AI, which will help the police make informed decisions.
Martin Wrigley
Palantir appears to have a habit of avoiding competitive tender and scrutiny by using free trials and locking up the contract specifications after getting a foot in the door. I congratulate the London Mayor on stopping the recent potential contract offered by the Met police without a competitive tender process. However, last week, the estimated £17 million contract for the National Firearms Licensing Management System was won by a bid from Palantir of just £7.5 million, just 44% of the expected price. That suggests either a massive error in estimation, or Palantir buying the job, giving it unfettered access to whisper in the ear of all 43 police forces. Will the Minister pause the signing of that contract, which is due this Thursday, so that appropriate scrutiny can take place to ensure that a competitive tendering process has been followed transparently?
Sarah Jones
I can assure the hon. Gentleman that Palantir is not buying the job. In the Home Office we have very robust processes, which were followed in full. The current licence management system is approaching the end of its life, and it is very important that we have a good one to maintain safety. There was an open and competitive process, run by the Police Digital Service and BlueLight Commercial, which do these things on behalf of policing. The hon. Gentleman is right that the contract is yet to be signed, but Palantir is the preferred supplier and all the right processes were followed.
Chris Vince (Harlow) (Lab/Co-op)
I welcome the new legal framework around facial recognition technology. We have seen successful trials of this in Harlow, but does the Minister agree it is essential that that technology is deployed lawfully, proportionately and with accountability, and that that is taken into account when any Government contract is granted?
Sarah Jones
I agree with my hon. Friend that live facial recognition is an extraordinarily innovative new technology that helps us catch really nasty criminals in my constituency and in other parts of the country, and we are investing in it through our police reform agenda. We are also legislating for it, because we totally recognise that there is some uncertainty about what it is used for and how it should be used. We want to put that right, be really clear about it, and put it on the face of legislation.
Jack Rankin (Windsor) (Con)
The Parliamentary Under-Secretary of State for the Home Department (Mike Tapp)
Living in this country permanently is a privilege, one that should be earned, not granted by default. We are currently analysing 200,000 consultation responses, and we expect to introduce major reforms in the autumn.
Jack Rankin
In January 2025, I urged the Government to act on indefinite leave to remain, to prevent the fiscal calamity of locking in the Boriswave. I thank the Ministers for their movement in that regard. It is important that we are transparent with the public about who is using visas as a route to a life on benefits, so can the Minister provide an estimate of the number and proportion of individuals holding ILR who are currently in receipt of universal credit?
Mike Tapp
As of January 2026, 222,000 people with ILR were actively claiming universal credit.
Jo Platt (Leigh and Atherton) (Lab/Co-op)
The Secretary of State for the Home Department (Shabana Mahmood)
Dodgy shops are blighting our high streets—we all see them in our constituencies—so this Government have announced a new high street organised crime taskforce, investing £30 million in law enforcement action. That will fund more officers and a nationwide unit based in the National Crime Agency, and will strengthen powers to tackle these criminals.
Jo Platt
We welcome the creation of the Government’s high street organised crime unit, and in particular its focus on strengthened partnership working between enforcement agencies. In Leigh and Atherton, communities can see that commitment, but they are asking when they will see action on dodgy shops operating in plain sight. Given the national campaign I have launched with colleagues, will the Minister set out when enforcement will begin locally, how partnerships will be delivered and how we will ensure that these criminal enterprises are shut down without delay?
Shabana Mahmood
First, I welcome my hon. Friend’s important work in this area. Greater Manchester is one of three hotspot areas selected for an enhanced operational crackdown in addition to the nationwide campaign. I cannot comment on specific dates due to operational sensitivities, but the public can expect to see the start of a major offensive against dodgy shops beginning this year.
Dame Karen Bradley (Staffordshire Moorlands) (Con)
The Home Secretary will be aware of the inquiry that the Committee is conducting on the role that organised criminality plays in the crime we see on our high streets. We heard compelling evidence recently about counterfeit goods, the role they play, and the role that forced labour plays throughout that supply chain. Can the Home Secretary explain what she is doing to combat forced labour? I look forward to putting more questions to her when she appears before my Committee before the summer recess.
Shabana Mahmood
It is always a pleasure to appear before the Home Affairs Committee, and I thank the right hon. Member and her Committee for their work on this important area. She will know that the money we announced recently will fund work by trading standards, His Majesty’s Revenue and Customs and immigration enforcement. If we pick up cases of forced labour, that will engage our modern slavery obligations. That money is part of a full-spectrum response to a complex issue. I saw some of the counterfeit goods when I joined the police on a raid at the end of last week. It is a real problem, and the Government are ensuring that we fund every aspect of how we fix it.
Damien Egan (Bristol North East) (Lab)
The Minister for Security (Dan Jarvis)
The Government are delivering a fundamental reset of how we counter extremism. That includes publishing an annual state of extremism report, which will arm frontline public sector workers with the information they need to tackle extremism in the UK.
Damien Egan
Extremism in the UK is growing at an unprecedented rate. Extreme left and extreme right ideologies, alongside growing Islamist extremism, are being fuelled by increasingly brazen interference from foreign states, and we need to be clear-eyed about those threats. At a recent summit hosted by Wilton Park, I heard how countries such as Norway now treat extremism as a national security priority, linking it more to defence. Will the Minister consider establishing a proper mechanism so that we can designate domestic extremist groups? Will the Government commit to recognising extremism and social cohesion as a first-tier national security priority?
Dan Jarvis
I am grateful to my hon. Friend for his attention to these important matters. As we set out in “Protecting What Matters”, the Government recognise countering extremism and enhancing social cohesion as a priority area, and we set out a range of commitments to achieve that. Although there is no explicit offence of extremism, the police have a range of tools and powers to counter the activities of extremists. We are fast-tracking the creation of a new state threats designation power, which will further clamp down on individuals and groups carrying out hostile activity for foreign states.
Sir Oliver Dowden (Hertsmere) (Con)
I am sure the Minister will have seen footage of a recent attack on Helen Mirren, where she was described—excuse my language, Mr Speaker—as a “Zionist bitch”. This is just another example of deliberate extremist intimidation aimed at frightening off anyone in public life from supporting the existence of the state of Israel or defending the Jewish community. While Helen Mirren decided not to press charges, does the Minister agree that the police should treat such assaults with the utmost seriousness, as they are attacks not just on the individual, but on our shared values in this place of freedom of speech and freedom of expression?
Dan Jarvis
The right hon. Gentleman has raised an important point. I have seen the footage. Like, I am sure, all other Members, I was shocked but not surprised by it. The police have an important job to do in cracking down on this kind of activity, but I can give the right hon. Gentleman an absolute assurance of the priority that this Government attach to antisemitism. We have seen a range of abhorrent antisemitic attacks in recent times, and we will do everything we can to stand against them.
Matt Vickers (Stockton West) (Con)
We have seen the devastating impact of extremism on our country, with the Jewish community experiencing disgraceful attacks. Does the Minister share my concern about the fact that in recent elections, candidates such as Kate Hollern were threatened with beheading? More recently, we have seen convicted terrorists standing for election. What will the Minister do to prevent that? Does he believe that individuals with terrorist convictions should be allowed to stand for election?
Dan Jarvis
The shadow Minister will know that the defending democracy taskforce, which I chair, is looking carefully at the issues that he has raised, which are indeed abhorrent. He has made a powerful point. The Government are considering whether further action is required, and I should be happy to work with him on it.
Jim Dickson (Dartford) (Lab)
The Minister for Policing and Crime (Sarah Jones)
Through our Crime and Policing Act 2026 we have new and enhanced powers to enable local agencies to tackle antisocial behaviour offenders, and our neighbourhood policing guarantee has ensured that every police force in England and Wales now has a dedicated antisocial behaviour lead and a local action plan to crack down on offenders who blight our communities.
Jim Dickson
Residents of Darenth and other parts of my constituency are facing persistent nuisance owing to the antisocial riding of motorbikes and quad bikes in local woodlands over the last few years. I know from my conversations with the new district commander for Dartford and Gravesham that the police are starting to use the powers in the Crime and Policing Act to seize and crush vehicles and issue community protection notices to offenders. Can the Minister tell Dartford residents how those new powers, and other Government measures, will finally tackle this antisocial behaviour at source?
Sarah Jones
I think we all share the hunger to tackle this awful crime, which blights communities. Through the Crime and Policing Act, we have strengthened police powers to swiftly seize vehicles that are used antisocially. We have stripped away the requirement to issue a warning, which enables officers to act immediately to take vehicles off the streets, and we are introducing new respect orders, which can tackle persistent offenders in this and other areas. We have just carried out a consultation, and will shortly be looking at what we can do to shorten the period for police dispersal so that these things can be crushed more quickly.
Jess Brown-Fuller (Chichester) (LD)
In my constituency and across the country we have seen a troubling rise in violence towards wildlife, often with the use of catapults. Wildlife crime is not an isolated incident; it is usually related to something else. Studies have shown that seven out of 10 victims of domestic violence who owned pets said that their domestic abusers were also threatening, harming or killing those pets. Will the Minister please look at Holly’s law, which would create an animal cruelty register to deter wildlife crime, which often leads to other violent crimes?
Sarah Jones
We will certainly look at any proposals to tackle wildlife crime. I know that the use of catapults is a particular issue. This week I shall be holding a roundtable with a number of interested parties, including people who will, I suspect, be saying the same thing as the hon. Lady. We fund the national rural crime unit and the national wildlife crime unit, which provides more resources for this purpose, but we will certainly keep all options on the table.
Jas Athwal (Ilford South) (Lab)
Mary Kelly Foy (City of Durham) (Lab)
The Secretary of State for the Home Department (Shabana Mahmood)
We have made the landmark commitment to halve violence against women and girls in a decade. The Government have already begun to implement domestic abuse protection orders, which have protected more than 1,000 victims, Raneem’s law, placing domestic abuse experts in 999 control rooms, and the provision of specialist rape and sexual offence teams in all police forces in England and Wales. Our ambition is clear, but there is much more work to be done.
Jas Athwal
Harshita Barela was just 24 years old when she was murdered and her body was dumped in a car boot in Ilford. Nearly two years on, her husband and alleged killer has still not been arrested, and is believed to be hiding in India. A few weeks ago I was humbled to meet Harshita’s parents, who had made the journey to trace her last steps. They deserve justice and closure. Does the Home Secretary share my horror at this vile murder, and will she meet me to discuss what further steps can be taken by those in this country, working with the Indian authorities, to bring her alleged killer to justice?
Shabana Mahmood
My deepest sympathies are with Harshita’s family for their unimaginable loss. No one should have to go through what she and her loved ones have endured. As the investigation is live, I cannot comment further. I hope my hon. Friend will understand that doing so could prejudice the investigation and the path to justice for Harshita and her family.
Mary Kelly Foy
At my recent market stall at Durham Pride, local Labour members and I spoke to many people about the Government’s VAWG strategy. The message we received was clear: it is strongly welcomed but long overdue. The clock is ticking, and there is still no published timetable. When will the Government action the plan and the necessary grassroots consultation? How will progress be publicly reported so that women and girls in Durham and beyond feel reassured that this Government take seriously the effort to stamp out violence against women and girls?
Shabana Mahmood
First and foremost, this Government’s commitment is evidenced by our landmark commitment to halve the levels of violence against women and girls over a decade. We have a deliberate 10-year vision to do that, because it is a wider societal change that we are seeking to enact. We are delivering that transformational change to keep more victims safe. Work has begun, but there is much more to be done. As my hon. Friend will know, these matters are discussed regularly in the House, and I will keep Members updated.
Jim Shannon (Strangford) (DUP)
I thank the Home Secretary for her responses. In the last two to three weeks in Northern Ireland, we have had two horrific murders of women and their unborn children; in both cases, heavy sentences have been handed out. Given her responses to the hon. Members for City of Durham (Mary Kelly Foy) and for Ilford South (Jas Athwal), it is important that we have similar rules in Northern Ireland for those who carry out vile, horrific killings of their partners and their unborn children. There must be a sentence that equals that.
Shabana Mahmood
Let me assure the hon. Gentleman that criminal law applies across the whole of the UK. Those are things that we track as a Government, and I will look at the substance to see if we need to change the law. We work very closely with our colleagues in Northern Ireland, and I will ensure that the ministerial team discuss these matters with their counterparts in Northern Ireland.
Alicia Kearns (Rutland and Stamford) (Con)
May I put on the record my sympathy for the family and colleagues of Sir Alex Younger? He was a true patriot.
Two years ago, this Government pledged to halve violence against women and girls within a decade, but the Minister responsible for delivering that promise has now resigned. In her resignation letter, the hon. Member for Birmingham Yardley (Jess Phillips) laid a damning charge: that Government progress came from the fear of embarrassment from
“threats made by me in light of catastrophic mistakes”,
and that it was only when the Prime Minister’s shameful decision to appoint paedophile apologist Lord Mandelson “bubbled up” that No. 10 would “kick into gear” and finally do anything about women and girls.
Two years in, we still do not know how this Government are going to measure violence against women and girls and whether it has halved, so my ask is simple and is something that the Government can do today: extradite Andrew and Tristan Tate to the UK to answer Crown Prosecution Service charges that were laid in 2024. It is a political decision. A year since I asked for them to be extradited, the Government should do what is right. If they are in Dubai or Hong Kong, they can be extradited. Why will the Government not extradite them?
Shabana Mahmood
The shadow Minister will know that we never comment on matters relating to extradition, or on any specific cases. I would never want to say anything at the Dispatch Box that prejudices any future action—she knows that well enough. She has made her point in relation to those two men, and I am sure that point has been heard.
Dave Robertson (Lichfield) (Lab)
The Parliamentary Under-Secretary of State for the Home Department (Natalie Fleet)
It was an honour to be by the side of the Prime Minister when he met Fayed victim-survivors last week. I was proud that one of my first acts in post was to help facilitate the first meeting of this kind with these brave women. No one is above the law, and those who perpetrate or facilitate abuse must be held to account. I will continue to engage with my hon. Friend’s all-party parliamentary group so that victim-survivors know that this Government are listening.
Dave Robertson
I welcome the new Minister to her place. I thank her for her work in facilitating the historic meeting last week, which was the first time a sitting Prime Minister has met a group of survivors in this space. It was a great meeting, but the survivors are understandably sceptical, because they have been let down severely by so many institutions for so long. Can she outline the steps she will take in the short and medium term to ensure those survivors start seeing the justice they have been denied for far too long?
Natalie Fleet
I thank my hon. Friend for the work he is doing with the APPG. As the Prime Minister made clear, the Government are committed to engaging with the Fayed victim-survivors and ensuring that their concerns are addressed. I will shortly be in contact with them to follow up on the meeting last week, and we will set out the form that that engagement we take. We will absolutely ensure that this is the start of a process, not the end. These women absolutely need to be heard.
Wendy Chamberlain (North East Fife) (LD)
Alongside the hon. Member for Lichfield (Dave Robertson), I was present at the meeting with the Prime Minister last week. I welcome the Minister to her place and thank her for her time at the meeting. We have heard consistently from survivors that they were trafficked in many locations by many different people. Given that that partly fits the category of organised crime, what consideration has the Minister given to getting the National Crime Agency involved with this investigation, which would help build survivors’ confidence and trust in the ongoing investigation?
Natalie Fleet
I thank the hon. Member for her work on the APPG and the vital work she is carrying out in supporting these women. Where there is evidence of criminal activity, it is the police’s duty to investigate, and it would not be appropriate for me to comment on the specifics. My job and the role of the Government are to support the police to ensure that justice is delivered as swiftly as possible, and I am absolutely committed to that.
Rachel Taylor (North Warwickshire and Bedworth) (Lab)
The Minister for Border Security and Asylum (Alex Norris)
This Government are taking decisive action to restore order and control at our borders. We have removed nearly 70,000 people who have no right to be here, we are overhauling our asylum system to reduce pull factors and we have funded more officers to disrupt organised immigration crime, with interventions at their highest rates and the number of linked arrests rising by over 55%.
Rachel Taylor
I thank the Minister for his answer and for visiting my constituency of North Warwickshire and Bedworth recently. My constituents will strongly welcome the most recent data showing that small boat arrivals are massively down this year, but can the Minister confirm that this important progress is just the beginning of restoring order and control at our borders?
Alex Norris
I am grateful to my hon. Friend for her question. When I visited her community, I heard in no uncertain terms on the doorstep how important this issue is to people, as it is for my community and the rest of the country. That is why we are stepping up the international action we have taken, including the important new deal with France. Domestically, we will be legislating through our immigration and asylum Bill to create the system that I know her constituents want, which is a fair but firm one.
Chris Philp (Croydon South) (Con)
Nigerian illegal immigrant Gift Oladele was recently jailed for the brutal rape of a teenage girl. He dragged her into isolated woods, leaving her terrified, and she now has recurrent nightmares. Oladele had committed previous violent sexual offences, and the Home Office rightly tried to deport him, yet an immigration judge allowed him to stay because of Oladele’s human rights, and he went on to violently rape the teenage girl. I believe the rights of women and girls to be protected are more important than the supposed human rights of foreign rapists to stay here. Is it not time to leave the European convention on human rights, so that all criminals such as Oladele can be deported?
Alex Norris
Let me start by saying that I agree that that is a truly awful case. It shows how important it is that we remove people who commit crimes, and we have removed nearly 8,000 foreign offenders since we came into office. But the right hon. Gentleman’s prescription does not match up to a solution: leaving the ECHR would undermine our returns agreements with countries around the world. Instead, our contention is that we can improve it. We have said that we will look at legislating to narrow the domestic interpretation that has sprawled around article 8, and he will have seen the progress we have made internationally on article 3. That is the sensible approach, rather than chasing a sugar high that he knows—because he did not do it when he could have done so—will not work.
Max Wilkinson (Cheltenham) (LD)
Brexit has seen off a number of Prime Ministers, but as we approach the 10th anniversary of the referendum this Prime Minister has apparently been given a period of indefinite leave to remain in No. 10. Ministers are clearly feeling unusually generous, but are they aware of a report by the Oxford Migration Observatory, which shows that Brexit is actually a pull factor for dangerous small boat crossings? It is now obvious that the Government’s one in, one out scheme with France is never going to work at the scale required, so will Ministers today re-state for the official record that Brexit is a large contributor to the small boats crisis, and will they commit to pursuing a new comprehensive asylum deal with the entirety of the EU?
Alex Norris
If we are talking anniversaries, I would like to take this opportunity to wish my fellow class of 2017 intake a happy ninth anniversary today. Our ninth anniversary has been full of Liberal Democrat spokespeople trying to pin every single thing on Brexit. I say to the hon. Gentleman that those conversations, designed just to create division in the country, do not serve the common aim of ensuring we have a robust asylum system. We can do that through ordinary collaboration with our neighbours on the continent. I do that frequently and my right hon. Friend the Home Secretary does that frequently. Look at the action that that has delivered with France alone. That is the better way forward.
Perran Moon (Camborne and Redruth) (Lab)
The Minister for Border Security and Asylum (Alex Norris)
The Government committed to new safe and legal routes in the “Restoring Order and Control” statement, and my right hon. Friend the Home Secretary announced that the student refugee route will open this autumn, with arrivals in autumn 2027. We are working with partners to design new routes to ensure they are safe and controlled, and we will provide an update to the House in due course.
Perran Moon
In recent years, families across Cornwall have been offering safe and welcoming homes to Syrian and Afghan refugees through the community sponsorship scheme. Without using the words “dreckly”, “mañana” or “in due course”, can the Minister specify when the community sponsorship scheme will be extended, as promised?
Alex Norris
And I thought the hon. Member was my hon. Friend, Mr Speaker! But what he says speaks to the innate goodness of the Cornish people—it is the same in my own community and across the country. Whether it has been the Syrian scheme, the Afghan scheme, Hong Kong British nationals overseas or Homes for Ukraine, the British people have leant in when schemes have been ordered and controlled. We are working with stakeholders on what that looks like, but getting this right is crucial to the programme’s success, which is why it takes a little bit longer—it will take us time to get it right. I make no apologies for that, but I will say that further details will be set out “in due course”.
Gideon Amos (Taunton and Wellington) (LD)
Dr Alasttal in my constituency is doing vital medical work. In normal circumstances, his wife would be allowed to visit him on the appropriate visa, but because she is in Gaza and would have to travel to Israel or to other cities to give biometric information, she cannot visit or join him here. Will the Government change the rules in the way they did for Chevening scholars, so that people in Gaza can give biometric details in other ways?
Alex Norris
I cannot speak to that individual case, but I recognise the challenges where no visa centres are open in areas of conflict. We have taken what I think is a quite pragmatic and flexible approach, not just with students but medical evacuations as well. If the hon. Gentleman is able to write me and the Minister for Migration and Citizenship, we will look at that case accordingly.
Dr Danny Chambers (Winchester) (LD)
The Secretary of State for the Home Department (Shabana Mahmood)
I believe that we in this House have a duty to protect the children of this nation, but there can be little doubt that collectively we have failed to keep pace with the changing threats they face. Nowhere is that more apparent than in the horror of online sexual exploitation and abuse, but we have begun to change the story.
Today, we laid down the gauntlet to tech firms. We have told them that they must block nudity on children’s phones. We know the tech is there; we know there is a way. The question is: do they have the will? The tech firms now have three months. The clock is ticking. If they do not introduce these controls, we will legislate and force them to do so. This is a landmark moment in the protection of children in this country, so if I may, I will end by paying tribute to the woman who has pushed for this harder than anyone else, my hon. Friend and former colleague in the Home Office, the Member for Birmingham Yardley (Jess Phillips). The children of this country will be safer as a result of her work.
Dr Chambers
I too pay tribute to the hon. Member for Birmingham Yardley for her immense campaigning and work in this area. Can the Secretary of State be more specific on what actions will be taken to prevent women and girls becoming victims of AI-generated sexual content, because it really can ruin lives?
Shabana Mahmood
The hon. Gentleman is right that it can ruin lives. The Government have already held different platforms to account, and the hon. Gentleman will know about our row with Grok and the action we forced as a result. We are alive to the online environment and what that means for deepfake images and nudification apps—areas where we have already taken action. The action today on device-level controls to block nudity for children is a game-changing moment because it will prevent children from becoming sex offenders before they even know what sex is, and from being victims of sextortion. It is the right way forward.
Laura Kyrke-Smith (Aylesbury) (Lab)
The Minister for Security (Dan Jarvis)
My hon. Friend may be aware that I recently met the hon. Member for Mid Buckinghamshire (Greg Smith) and the rabbi for south Buckinghamshire. She will know that the Jewish community protective security grant scheme, administered by the Community Security Trust, funds security measures such as CCTV, alarms and fencing, which require fixed sites to install and maintain. However, I fully recognise the fear and concerns raised by mobile Jewish congregations, and we are working closely with CST to understand what more support we can give.
Chris Philp (Croydon South) (Con)
The “Police Anti-Racism Commitment”, a copy of which I have here, published in March 2025 by the National Police Chiefs’ Council, asks police to reverse engineer the same arrest rates for different ethnic groups, even though offending rates are different. It expressly calls for different racial groups to be treated differently, saying that people should not treat “everyone ‘the same’” or be “colour blind”. This is a formal policy requirement for two-tier policing. I have been raising this issue for over a year, and I have never had an answer, including from the Home Secretary last Tuesday. Let me try again: does she agree that this racist and dangerous policy document should be immediately withdrawn—yes or no?
Shabana Mahmood
The right hon. Gentleman knows full well that the NPCC, which is independent of Government, is rightly reviewing the wording of the “Police Anti-Racism Commitment” to ensure that there is no ambiguity or suggestion of differential treatment. [Interruption.] The right hon. Gentleman speaks from a sedentary position, but I say to him that I have taken more action on preventing differential treatment in the criminal justice system than he or his party ever did.
Chris Philp
The Home Secretary still gives no clear answer. We have repeatedly raised serious concerns with the Government’s Islamophobia definition. South Wales police has now instructed staff to record anything that goes beyond “legitimate discussion of Islam”, even if there is no crime. That could then be disclosed on someone’s Disclosure and Barring Service check. Police officers in south Wales will now have to decide what is or is not legitimate discussion of Islam. No other religion is treated that way in south Wales. That is completely wrong. Parliament has rightly repealed blasphemy laws, and criticising religion is part of free speech, so does the Home Secretary agree that the guidance is wrong and should be scrapped immediately? Let’s try a simple yes or no.
Shabana Mahmood
Given that the right hon. Gentleman represents a party and former Government that did not take any action on dealing with hate crime, anti-Muslim hatred, or other forms of hatred, I am not going to take any lessons from him. Let me make clear from the Dispatch Box that the police, wherever they are—south Wales or anywhere else—must always police without fear or favour, and we all must always be equal before the law.
Liam Conlon (Beckenham and Penge) (Lab)
The Minister for Policing and Crime (Sarah Jones)
Around half of vehicle crime involves manipulation of signals from remote devices. Through the Crime and Policing Act 2026, we have criminalised the possession, importation, making, adapting and supplying of the electronic devices used to commit vehicle theft, which will make a real difference in my hon. Friend’s constituency.
Max Wilkinson (Cheltenham) (LD)
Last week we discussed the murder of Henry Nowak, which continues to shock the country. As we said last week, his father, Mark, asked politicians not to use the tragedy to stoke division and hatred. With that request in mind, and considering the need to maintain trust in policing, would the Home Secretary like to take this opportunity to urge Vice-President J. D. Vance and the US Department of Justice to butt out of our politics, leave British law enforcement to Britain and, just as importantly, show respect for British victims of crime?
Shabana Mahmood
I urge all commentators, would-be commentators and wannabes of every description to leave our criminal justice system to us. We have been going for a very long time, and we will carry on in that vein.
Sureena Brackenridge (Wolverhampton North East) (Lab)
The Parliamentary Under-Secretary of State for the Home Department (Natalie Fleet)
Women and girls must feel and be safe everywhere, which is why we have provided funding for police to trial and evaluate Project Vigilant, where plain-clothed officers are deployed within the night-time economy to identify and de-escalate behaviours known to precede sexual offending. We are providing £13.9 million to improve the policing response to violence against women and girls nationally. New legislation means that someone causing intentional harassment, alarm or distress because of a person’s sex can now face up to two years in prison.
Edward Morello (West Dorset) (LD)
Sarah Jones
The hon. Gentleman is a bit behind the times; we have already announced that we are reforming that formula.
Rachael Maskell (York Central) (Lab/Co-op)
Sarah Jones
I thank my hon. Friend for her question—[Interruption.] The right to peaceful protest and public assembly is one that we must protect, but it must be balanced with the need to maintain public order and keep the public safe. Perhaps she could write to me with further detail. If she wants to have a meeting to talk about it, I would be very happy to do that.
Mr Speaker
Order. I just want to help the hon. Member for York Outer (Mr Charters). The Minister was answering, and you walked straight across both of us—not that I should need to explain that.
John Lamont (Berwickshire, Roxburgh and Selkirk) (Con)
The Parliamentary Under-Secretary of State for the Home Department (Mike Tapp)
Under the previous Government, we saw 2.5 million people arrive in just four years—that is one in 30 people in the country at this time. This Government have brought migration down by 82% since its peak and by 41% in the past year.
Catherine Fookes (Monmouthshire) (Lab)
I welcome my hon. Friend the Minister to her place. Surviving Economic Abuse estimates that around 750,000 women are trapped in a joint mortgage with an abusive partner or ex-partner, with the only way out often being to let their home be repossessed, as abusers refuse to contribute their share of repayments or prevent the sale of the property. I welcome the fact that the Government want to explore solutions, including what could be done through the Financial Services and Markets Bill, but what steps will the Government take to stop joint mortgage abuse as part of their wider commitment to halving violence against women and girls?
Natalie Fleet
The VAWG strategy and the financial inclusion strategy set out ambitious commitments to tackle financial abuse. The Government are determined to embed the prevention of violence against women and girls across all Departments. Our VAWG strategy and the financial inclusion strategy are committed to exploring how we can make it harder for abusers to use joint financial products, including joint mortgages, as a tool of abuse, and how to better support victim survivors. Last week the Economic Secretary to the Treasury and I hosted a roundtable with 16 banks and financial service organisations to underscore Government priorities, share best practice in the financial services sector, and agree how we can work together to deliver commitments in the VAWG strategy and the financial inclusion strategy.
Helen Maguire (Epsom and Ewell) (LD)
Sarah Jones
I am working closely with the Department for Transport on the challenges with e-scooters and the use of e-bikes, which I know many Members across the House will have. Making sure that we have more neighbourhood police in our communities is the absolute core of the issue, and that is what the Government are delivering.
Jess Phillips (Birmingham Yardley) (Lab)
I would like to take this opportunity to pay tribute back to the Home Secretary, who has worked incredibly hard on the issues on which the Government made their announcement today. The BBC carries the headline that we will stop children sending and receiving images; can she say for the House that the change will also stop children ever taking naked images of themselves, and give us an assurance that her Department is working on robust legislation and a legislative vehicle to make sure that can happen?
Shabana Mahmood
I very much thank my hon. Friend for her question, and she is absolutely right. Let me clarify for the House that this involves the taking of those images. We will also follow through on the threat to legislate, and the Department is working at pace on the content of the legislation and the appropriate vehicle in the second Session.
Gareth Bacon (Orpington) (Con)
Sarah Jones
The murder rate is at its lowest level ever recorded in London. The police have more money and more resources to tackle crime, and we are working closely with them as they do that. I gently remind the hon. Gentleman that when his party’s Government recruited police officers, they put them behind desks. We are putting them on our streets, fighting crime.
Dame Nia Griffith (Llanelli) (Lab)
With the news that the Stradey Park hotel has now gone into receivership, what assurances can the Minister give my constituents in Llanelli that his Department has no plans to use the premises for asylum seeker accommodation?
The Minister for Border Security and Asylum (Alex Norris)
I assure my hon. Friend and colleagues across the House that we are closing hotels, not opening them.
Jerome Mayhew (Broadland and Fakenham) (Con)
My constituents hate seeing organised shoplifting taking place with apparent impunity. Norfolk police recognises this and has identified suspects in more than a third of all cases, but what is the point when the Government’s assumption is that any sentence shorter than 12 months will automatically be suspended? What are the Government going to do about it?
Sarah Jones
We are making some progress in this space. It may seem small, but there was a 1% fall in shop theft offences last year, and a 30% increase in the last year of the hon. Gentleman’s Government, so we are making progress. In particular, we are working hard on how we target prolific offenders more. We are using new technology and of course working with the private sector. Our Crime and Policing Act 2026 introduced new powers, so we are going to tackle shop theft in a way that the previous Government did not. We are also launching the centre for AI soon, which will give us new technology that we can use. We are bearing down on shop theft.
Sonia Kumar (Dudley) (Lab)
Sadly, last week Dudley town centre fell victim to vandalism again. The new central seating area was damaged, impacting local businesses and footfall. I welcome the Government’s efforts to restore neighbourhood policing and our new police station, but what further steps will the Minister take to tackle antisocial behaviour and to take criminals off our streets and allow businesses to operate safely?
Sarah Jones
We are working hard to introduce respect orders, which will be really important in this space. I am happy to visit my hon. Friend to see exactly what the problems are and what we can do, but we are introducing whatever powers we can to tackle “low-level” antisocial behaviour—that is what the previous Government called it—which actually blights our communities.
Dr Neil Shastri-Hurst (Solihull West and Shirley) (Con)
I listened carefully to the Minister’s response to my hon. Friend the Member for Broadland and Fakenham (Jerome Mayhew), but the reality is that every day shopkeepers are facing abuse and threats and being stolen from. A direct consequence of the presumption in the Sentencing Act 2026 that those with a sentence of 12 months or less will not face prison is that there is no deterrent. Can the Minister genuinely say that our streets are safer as a result?
Sarah Jones
First, we have introduced a new offence of assaulting a shop worker, which the previous Government failed to do. We are using every single tool in our armoury. Unfortunately, the previous Government did not provide the prison places they promised, so we have to deal with the situation as we find it.
Janet Daby (Lewisham East) (Lab)
The role of faith liaison officer is extremely important in Lewisham, but the post has been deleted. The officer is important with regard to preventing extremism and building community cohesion: they meet with faith leaders and have been integral to the inter-faith peace walk. I ask the Minister to look again at the role and see what more can be done. This is important not just for Lewisham but across the Met area and, indeed, across the country.
Sarah Jones
As my hon. Friend knows, that is a decision for the Met in terms of how it allocates its resources, but I hear what she said. In the light of the tensions we have faced in recent months, I am sure there is a role for policing in building relationships with our faith communities.
Pete Wishart (Perth and Kinross-shire) (SNP)
Every few weeks, assorted far-right activists descend on my peaceful city of Perth to holler abuse at asylum seekers placed in hotels by the Home Office. They come tanked up on misinformation and loathing, and the people of Perth are getting thoroughly sick of it. Some who attend have even been served with bans in their own communities, yet they roll up in Perth. What will the Home Secretary do about these individuals? Will she consider something like buffer zones between the protesters and the hotels?
Alex Norris
I am grateful to the hon. Gentleman for raising that important point. We know that those hotels across the country are providing a focal point for people to do things that they absolutely should not do, and we condemn that behaviour in the fullest terms. Our No. 1 goal is to shut the hotels—that is the priority—and I make that commitment to the community of Perth. Alongside that, we work with the local police to ensure that areas are supported and that all tools are used as effectively as possible. I can support the hon. Gentleman in that.
Tom Hayes (Bournemouth East) (Lab)
We are a patient people and a compassionate community in Bournemouth, but there is a feeling in town that, with our three asylum hotels, we are being asked to do more than our fair share. Will the Minister please set out for my constituents that Bournemouth is uppermost in his mind as he closes hotels and that Bournemouth’s asylum hotels are being prioritised for closure?
Alex Norris
My hon. Friend raises that issue with me very frequently indeed, and for good reason. I totally accept his characterisation. The people of Bournemouth have three such hotels, which is an extraordinary pressure not just on public services but on community tensions. I do not want those hotels open a minute longer than they have to be, so Bournemouth is absolutely uppermost in our minds.
Suella Braverman (Fareham and Waterlooville) (Reform)
Earlier this year, the race and faith network at Greater Manchester fire and rescue service wrote to its firefighters targeting anyone who might be representing Reform UK at the local elections in what can only be described as an attempt at intimidation. Firefighters can legitimately stand in local elections. Does the Minister agree that such politicisation and institutional bullying is wholly unacceptable? What will the defending democracy taskforce do to investigate that and stop it happening again?
Dan Jarvis
I listened carefully to what the right hon. and learned Lady said and will give it due consideration as chair of the defending democracy taskforce.
Euan Stainbank (Falkirk) (Lab)
The Government have cut the asylum backlog, reduced the number of people arriving illegally and shut more than half the hotels opened by Tory Ministers. Places in Scotland like Falkirk, Perth and Dundee must see further progress this year. When will we see the next phase of the hotel exit plan? How will Ministers ensure that it is equitable across the nations and regions of the United Kingdom?
Alex Norris
I am conscious of this issue, and think also of the Cladhan hotel in Falkirk and the impact on the local community, because my hon. Friend is rightly very dogged in raising this with me. I want to see that hotel closed. We are, of course, in the slightly better weather of the year, which puts pressure on services. Nevertheless, we want the hotels closed. We have made a commitment to do that within this Parliament, but I say to colleagues that they will not be open a minute longer than they have to be.
Lisa Smart (Hazel Grove) (LD)
Stephen Yaxley-Lennon has publicly thanked the donors who funded the recent Unite the Kingdom marches, which needed a significant police presence. We have heard mention several times this afternoon of equality before the law, so does the Home Secretary agree that the laws regarding the reporting of donations, both from the UK and from overseas, apply to members of all political parties equally?
Sarah Jones
Transparency underscores democracy, and we need to make sure we have that. Of course, we will talk to our colleagues at the Ministry of Housing, Communities and Local Government who run elections to make sure we are doing everything we should be doing.
Perran Moon (Camborne and Redruth) (Lab)
The horticultural sector in Cornwall is worth about £100 million a year, but it is reliant on the seasonal worker scheme. The scheme numbers are announced annually at the end of the year, but the daffodil season in Cornwall begins in January. Will Ministers meet me to discuss an earlier announcement and a two-year rolling scheme?
Mike Tapp
It is important that we continue our strategy to bring net migration down while also maintaining agricultural industries. I have met a number of people across the sector and of course I am happy to meet my hon. Friend after questions.
Sir Roger Gale (Herne Bay and Sandwich) (Con)
Further to the answer given to the hon. Member for Lichfield (Dave Robertson) earlier, Mohamed Fayed is beyond the reach of terrestrial justice, but many of the ladies he abused are still waiting for justice. The Metropolitan police has been conducting an inquiry into the activities of those who aided and abetted Fayed for many months. Will the Home Office ask the Met to expedite the inquiry so that those ladies can at last have justice?
Natalie Fleet
I can absolutely confirm how close this issue is to my heart. Within the boundaries of operational independence, the Home Office is regularly engaging, and rightly so, with the Metropolitan police. Those women absolutely deserve justice, and I will do everything within my power to make sure that they get it.
Dr Al Pinkerton (Surrey Heath) (LD)
My constituent, Richard, has been unable to work for four months because of Disclosure and Barring Service delays. Things are getting desperate at home, and he faces the prospect of defaulting on his mortgage this month. There has been a 10-month delay from the point of application to now. Will one of the Front-Bench team look at his case in particular, to help him out, but also try to take a hand of the DBS more generally?
Sarah Jones
I am certainly happy to look at that particular case. Perhaps the hon. Gentleman could write to me and I will look into it.
Greg Smith (Mid Buckinghamshire) (Con)
As if the Government’s announcement on watering down the provisions of the Equipment Theft (Prevention) Act 2023 were not disappointing enough, the secondary legislation to enact what is left of it still has not been tabled. Where is it?
Sarah Jones
It is a shame: the hon. Gentleman is much nicer when we meet personally than he is in the Chamber. He knows that we are working on that, and he knows that we will do it as soon as we can, but I am happy to have another conversation with him.
Edward Morello
On a point of order, Mr Speaker. In my topical question earlier, I asked the Minister whether the Department would reform the police funding formula to account for seasonality and rurality. The Minister said that that announcement had already been made; actually, only a review of the funding formula has been announced. Can you give me guidance, Mr Speaker, on how I can get information on what will be included?
Mr Speaker
You have put that on the record, and those on the Front Bench have heard it. I think it was an error rather than a complete misleading of the House, so I think we can leave it at that.
Alicia Kearns (Rutland and Stamford) (Con)
On a point of order, Mr Speaker. In March, I requested two briefings from the Home Office as a member of His Majesty’s loyal Opposition: one on Islamist terrorism and one on the security threat in Northern Ireland. After months of chasing, at the end of last month I received a reply from a private secretary informing me that
“we will need to decline the request of a briefing for Alicia Kearns on the security and threat picture in Northern Ireland and the Islamist terrorist threat”.
It is not unreasonable for the Opposition to request two briefings in six months. What advice and guidance can you kindly give, Mr Speaker, on how we can get the briefings we need so that we can hold the Government to account?
Mr Speaker
The Chair has no responsibility for that, but the Government have a responsibility to ensure that the Opposition are briefed. I am sure that point will have been noted.
Digital Safety: Children
(1 day, 5 hours ago)
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Urgent Questions are proposed each morning by backbench MPs, and up to two may be selected each day by the Speaker. Chosen Urgent Questions are announced 30 minutes before Parliament sits each day.
Each Urgent Question requires a Government Minister to give a response on the debate topic.
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Munira Wilson (Twickenham) (LD)
(Urgent Question): To ask the Secretary of State for Science, Innovation and Technology if she will make a statement on the Government’s new policy announcements regarding children’s online safety.
The Parliamentary Under-Secretary of State for Science, Innovation and Technology (Kanishka Narayan)
The Prime Minister has announced that this Government will take decisive action to strengthen children’s online safety, including new expectations on technology companies to introduce crucial safety measures on children’s phones. The Government are clear that children are facing unacceptable levels of sexual harm online, including grooming, sextortion and coercion into sharing intimate images. A single image can trap a child in a cycle of abuse—something I have personally heard about from young people, families and civil society. I hold them in my mind and heart as we take action to stop this harm at source.
To address this issue, we have set out expectations that technology companies introduce device-level protections for children. The protections will prevent children from taking, sharing or viewing nude imagery across all core device functionalities, including camera, messaging apps, search functions and file sharing. The protections are built directly into the operating system.
We recognise that companies have already developed and implemented nudity detection on devices, and we want to work collaboratively with industry to build solutions and call on companies to take action within three months. We have been clear that if industry does not meet our high expectations, we will not hesitate to legislate. Furthermore, the Government’s “Growing up in the online world” consultation closed on 26 May. The Government are reviewing the responses and will provide an update in the coming weeks.
Munira Wilson
Thank you for granting this urgent question, Mr Speaker. I thank the Minister for his response. Today and over the weekend, we have seen a Prime Minister who has spent months completely disengaged from the digital threats facing our young people suddenly experiencing an eleventh-hour damascene conversion. This sudden rush seems to be driven entirely by a looming ballot in Makerfield and a full-scale rebellion on his Back Benches.
We Liberal Democrats will not criticise someone for reaching the correct position, even if it has taken them some time, but unfortunately this Government’s approach remains profoundly weak. It is shameful that the Prime Minister has to beg big tech to stop the proliferation of child sexual abuse imagery. He could and should make these changes anyway, so I appeal to the Minister and, if he is watching, the Prime Minister: just bring forward the legislation. Why is the Prime Minister still asking big tech to co-operate with him when it has constantly shown a total disregard for our children and young people?
Broader proposals regarding a ban on harmful social media for teenagers were briefed to the newspapers over the weekend. The Liberal Democrats welcome these reports, and again urge Ministers to move quickly and decisively. Only through a smart film-style age-rating system can we protect children from harmful online content and algorithms. I am delighted that, in pursuit of a legacy, the Prime Minister seems to be borrowing more Liberal Democrat ideas wholesale—tiered age-rated access, ending infinite scrolling and tackling online gaming, not just social media—despite ordering his MPs and peers to vote repeatedly against many of those proposals during the passage of Children’s Wellbeing and Schools Act 2026.
However, today is not about who voted which way. I ask the Minister and, through him, the Prime Minister to remember the children who have lost their lives because of the harms they have encountered online, and those whose mental and physical health and education have been harmed by what they have been exposed to online. It is for those children that we must work together to bring about change. The Prime Minister must stop begging tech companies to protect our children and start acting himself—now.
Kanishka Narayan
It is astonishing to hear the Liberal Democrats mention a lack of action. On Grok, this Government stood up to the richest man in the world, stood him down and as a result secured protections for people in this country. We have acted on cyber-flashing and strangulation in pornography, banning nudification tools and criminalising nudification, and putting personal criminal liability on tech bosses if they do not act. I understand that the Liberal Democrats are seeking relevance by doing a strategy review, but their complaint is still too much.
Justin Madders (Ellesmere Port and Bromborough) (Lab)
I welcome this announcement, but is it not shocking that these companies have to be told what is unacceptable—that children should not be able to send and receive naked images? I ask the Minister: is this a tech problem or an issue of a lack of understanding and decency at the heart of these companies?
Kanishka Narayan
I thank my hon. Friend for a point well made. We have been consistently robust with tech companies on this question. I pay tribute to my hon. Friend the Member for Birmingham Yardley (Jess Phillips) for her leadership on this question. It is, to me, not a technology problem; we have the technology to act on this, and we will now deliver that in the real world.
Peter Fortune (Bromley and Biggin Hill) (Con)
I congratulate the hon. Member for Twickenham (Munira Wilson) on securing this important urgent question, and suggest that the Minister perhaps shows a touch more humility on this important issue.
His Majesty’s loyal Opposition would welcome measures to prevent under-16s from accessing harmful social media. After all, it has been our policy for some time, and we are glad that the Government are finally starting to catch up. This Government’s record of kicking the can down the road on children’s online safety contrasts starkly with the action taken by the Conservatives. The last Government brought in the Online Safety Act 2023, which is already cutting the number of children accessing porn. When it became obvious that more needed to be done, the Leader of the Opposition stood alongside parents and campaigners in calling for more. Only then did the Prime Minister leap swiftly into action—by announcing a four-month consultation on an issue so necessary and so blindingly obvious to the rest of us.
Let us not forget that just six months ago, the Prime Minister was personally opposed to a ban. Now, with nothing else to show for his time in office, he has performed yet another U-turn and discovered that protecting children was his priority all along. This is not leadership; it is legacy hunting, and thin gruel after so many missed opportunities: the safer phones Bill, the amendment to the Data (Use and Access) Act 2025, and my noble Friend Lord Nash’s amendment, which was opposed not once, not twice, but three times before the Government finally conceded. Labour constantly voted down the very protections it now says are required.
So why now? Is it a genuine epiphany or is it the by-elections, or is it the rather inconvenient fact that a rival from the north has already staked out this ground, leaving the Prime Minister with little choice but to follow? Time and again, this Government have to be forced to do the right thing, and do it only after they have exhausted every other option.
However, I do want this to work, so I ask the Secretary of State, via the Minister, three questions. Will these protections extend to existing devices or only to new handsets? If it is the latter, I am concerned that because 90% of 12-year-olds have hand-me-down phones, it will leave the most vulnerable children the least protected—
Mr Speaker
Order. I welcome the shadow Minister to the Dispatch Box, but he is supposed to have two minutes. He has now spoken for nearly three minutes, so I am sure that the Minister will have grasped what he had to say.
Kanishka Narayan
I first point out that in government, the Conservatives took seven years to pass a Bill and then found that law to be inadequate. That is why they are proposing all the things they are trying to do. This Government are listening to the people of Britain. I have been around listening to thousands of young people and families, and they say that they have a Government who are listening with humility and getting the action right on this central question. They say, on age assurance for adult content, that this Government have listened and acted robustly. They said so on Grok when the Opposition were missing in action. On the shadow Minister’s point about existing devices, I point out to him that a major provider has already applied age assurance at the device level for existing devices as well. We will learn the lessons and ensure that we are acting robustly in protecting young people.
Helen Hayes (Dulwich and West Norwood) (Lab)
I welcome the announcement today. The Education Committee recently took evidence from social media and gaming companies, which left every member of the Committee profoundly concerned. They downplayed the issues, denied the scale of harm and overplayed the magnitude and effectiveness of their own responses, so we have very little confidence that big tech knows what is required and has any motivation to do it. If, as seems likely, legislation is required after three months, can the Minister provide an assurance that the drafting of that legislation is already under way so that we do not lose any more time before our children are safe online?
Kanishka Narayan
My hon. Friend is absolutely right that time is of the essence, and I can confirm that we are working closely with the Home Secretary and the Home Office to make sure that we are ready to go if the companies do not act in the way they need to.
Dr Danny Chambers (Winchester) (LD)
Thank you, Mr Speaker, for granting my hon. Friend the Member for Twickenham (Munira Wilson) this urgent question. I am very disappointed that the Minister brought petty party politics into his response, because we have consistently proposed legislation that could have been implemented months ago. I speak on behalf of parents, teachers, carers and the children themselves in asking why the Prime Minister is pleading with tech companies about this. He is the Prime Minister; he should be leading the charge on blocking child sexual abuse material on smartphones. It is absolutely baffling that we have only reached this point now. We saw earlier this year the horrifying effects of Grok and other chatbots that are able to generate and share explicit content containing women and children at the request of online users. Children deserve far more than this dither and delay. The tech companies do not even deserve this three-month ultimatum. The Prime Minister should not be begging; he should be telling the big tech companies, “No to the proliferation of child sexual abuse imagery, and no to putting profit over the safety of children.”
Kanishka Narayan
Perhaps the hon. Member did not listen to the questioning about politics from his own party, but let me say two things. First, when I go around the country and speak to parents and young people, they say to me that the fact that 116,000 people have engaged with our consultation shows that this is a question on which the British public have strong views, but also that they have a British Government who are now putting those strong views directly into public policy action. On the question of pace, I simply point out to the hon. Member that we are moving at pace on this issue, and in particular that the Prime Minister has secured changes. When I went to Australia two weeks ago, they said to me, “Why was the UK the first place to secure changes on nudity blurring on operating systems for a major provider?” That is the result of the robust engagement we have had. The House is rightly questioning the pace of legislation. I am interested in the pace of outcome, and that is what we are delivering.
Fleur Anderson (Putney) (Lab)
Social media companies have been conducting a social experiment on our children for too long and parents have been left trying to bear the burden. I thank the Minister very much for many meetings over many months. Can he tell us the criteria for deciding which platforms are going to be deemed safe or unsafe when determining what young people should have access to and at what age? In particular, can he reassure the House that this will not be left to parents, as YouTube, for example, is still pushing for?
Kanishka Narayan
I thank my hon. Friend, who has been a remarkable champion for young people and families on this question, and I have deeply valued her input and expertise. On her question about definition, I will not pre-empt the decisions that will result from the consultation, but her representations on harmful functionalities are very much top of mind for me. I assure her that it will not be parents who will bear the burden of enforcement; we will ensure that it is very much the platforms who are responsible for enforcement and for acting.
Sir Edward Leigh (Gainsborough) (Con)
Rather than trading party political points, can we all agree that these huge companies are rotting our children’s minds with addictive algorithms? While we know that banning things seldom works because people circumvent it and it leads to criminality, will the Minister and the Prime Minister go to these companies and say that they are in the last chance saloon—either they take decisive action, which we know they can do, or we will ban children from going on social media?
Kanishka Narayan
In characteristic fashion, the Father of the House has given wise counsel, and I will very much take it to heart in the way that the Government act.
Clive Efford (Eltham and Chislehurst) (Lab)
It is clear that the sociopaths that run these platforms have no concern whatever for the welfare of anyone, but particularly our children, and that they will listen only if legislation is put before this House that makes them act and sends a clear message to them, so when are we going to do that?
Kanishka Narayan
I absolutely feel the weight of the point my hon. Friend makes about the inadequacy of what the tech companies have done so far. We are acting to make sure that young people in this country are secured from the harms they are experiencing. We have done that already by engaging robustly with the companies. As I said, we are already world-leading in that a major operating system has been reformed only in the United Kingdom to secure our children from harm. If that does not happen, we are working in parallel to make sure that the force of the law is felt as well.
Kit Malthouse (North West Hampshire) (Con)
It is a pity that the Minister has chosen attack as the best form of defence when so many Members across the Chamber have repeatedly raised their concerns about the issue over many years. Nevertheless, I will set aside his bombast in the hope that the implementation of these welcome changes is more thoughtful.
Will part of the planned guidance for parents about screen usage, particularly by very young children, address parents’ screen usage in the presence of their young children? There is growing evidence that what is now called technoference is having a strong impact on the attachments that parents form with their children in the early months and years of life, and that that is being felt, certainly in Andover and elsewhere in my constituency, in primary schools when those children arrive. It would be helpful for parents to understand the impact that screen usage is having on them and on their attachment to their children.
Kanishka Narayan
The right hon. Member makes an incredibly thoughtful point about something that I have heard in anecdote when engaging with young families. I am conscious that we are running a large-scale media literacy campaign to support parents in their understanding of social media and its impact on them and their relationships with their kids. I will take his comments and ensure that they are fed into the guidance that is prepared.
Becky Gittins (Clwyd East) (Lab)
The hon. Member for Twickenham (Munira Wilson) mentioned delay on this issue; perhaps she did not enjoy the same level of consultation that I and many of my Labour colleagues enjoyed with our constituents, which would be a shame. When I was in Ysgol Maes Garmon recently consulting with groups of parents, young people and students, I was surprised by how much commonality there was in what they asked for from this consultation, and it was my privilege to present what they said to the Minister last week. Does he agree with me, and indeed them, that it is the Government’s responsibility to call the tech companies to the table, so that there is an opportunity for parents, young people, Government and tech companies to all work together to protect our young people?
Kanishka Narayan
I thank my hon. Friend for her depth of engagement with young people and families in her constituency, which she has shown in her representations to me. I have heard consistently from young people, both here and abroad, that in the way that we have engaged on this question, we have made sure that we are doing politics differently: we are listening to the voices of young people and families and putting them at the heart of our decisions. She has done that in her community and we will do that across the country.
Caroline Voaden (South Devon) (LD)
It is funny how the thought of the Prime Minister’s legacy has suddenly spurred him on to take action to protect our children, when he has resisted for so long. That being said, it is welcome that the Government are listening to the Liberal Democrats’ proposal for a harms-based approach and are considering restricting different social media sites at different ages, rather than imposing a blanket ban that will have unintended consequences and be unworkable. Will the Minister confirm that the Government will include addictiveness as a factor when determining age restrictions for different sites, platforms, games and features?
Kanishka Narayan
In the spirit that has been recommended by the House, I will ignore the political attack in the first part of the hon. Member’s question. Her point about addiction being an important vector of harm is very much on our minds as we think about the appropriate action.
Rachel Taylor (North Warwickshire and Bedworth) (Lab)
Parents and teachers across North Warwickshire and Bedworth are worried sick that tech companies are wilfully allowing young people to share and access explicit content on their platforms and devices, and they are crying out for help. Does the Minister agree that it is high time the tech giants were held to account and forced into action to keep young people safe, and will the Government legislate without delay?
Kanishka Narayan
I wholeheartedly agree with my hon. Friend, who has been another remarkable champion: she has engaged with people in her community and represented those voices to me. We will ensure that those voices result in quick as well as deeply robust action.
Sir Jeremy Wright (Kenilworth and Southam) (Con)
The Minister is aware of my concern about the interaction between whatever the Government choose to ban and the workings of the Online Safety Act 2023 that we already have. I know the Minister recognises that that is an important interaction. Will he reassure me that the Government are fully aware that whether they ban access to social media entirely for children, or ban specific functionalities, we will need to ensure we do not undermine the duty of care that the OSA requires of social media platforms and others?
Kanishka Narayan
The right hon. and learned Member, with all his expertise and experience on this theme, makes an incredibly thoughtful point. He has made that point to me before, and I assure him it is on my mind to ensure that whatever we do, there is no levelling down of the force of the child safety duties under the Online Safety Act on the platforms—if anything, there is a levelling up.
Melanie Ward (Cowdenbeath and Kirkcaldy) (Lab)
To test Instagram’s claim that its teen accounts provide age-appropriate content, I set up a teen account as a 17-year-old boy called David. Without searching for anything, it took just 11 minutes of scrolling for David to be shown antisemitic conspiracy theories. Does the Minister agree that that is a disgrace? That is just one example of why it is time to stop asking social media companies to make their products safe and instead start requiring them to do so through regulation.
Kanishka Narayan
My hon. Friend makes an incredibly important contribution. I brought together Jewish leaders to ensure that they got time with the companies to tell them about the depth of prejudice they experience online, and I was horrified when I heard a very similar set of anecdotes. I agree with her, and the Government will continue to ensure that we bring the full weight of regulation and policy to bear against the tech companies.
Christine Jardine (Edinburgh West) (LD)
While we all welcome the fact that the Government are finally acting, I will point out to the Minister that not a single parent of the very many parents in Edinburgh West who have been in contact with me has requested that the Government ask the tech companies to behave differently. Every single one of them is concerned about their child—a child who is not the problem, but the victim of the tech companies. Is it not time to recognise that we made this mistake with the press? We left them to self-regulate over decades, and we ended up with Leveson and all sorts of problems, so why are we doing the same thing with the tech companies? We want change, so we should demand change and legislate for it, not let the people who created the problem decide when and how they will fix it.
Kanishka Narayan
I was visiting young people and families in Leith in Scotland just a few weeks ago. The thing I heard about more than anything else was the scale of harm that young people in those families were experiencing and a desire that we focus on doing the thing that stops that harm. That is why we will act robustly on the consultation we have done. In this instance, as I have mentioned before, we have already secured major changes; we will continue to do so and, in parallel, we will prepare legislation. I am interested in ensuring that young people in Edinburgh and across the country are protected from the horrific harms.
Matt Rodda (Reading Central) (Lab)
I welcome today’s decisive action. There have been the most appalling tragedies across the country, including in my constituency, where parents have lost children due to online harms. I know the Minister and the Prime Minister are working closely with parents, but may I urge the Minister to continue to do that, to carry out the type of engagement he has been carrying out, and to listen to the example from Australia? We look forward to hearing about more decisive action in the near future.
Kanishka Narayan
One of the big lessons of the Australian experience and beyond is that policy in this context is about not just short-term impact, but long-term norms. We will achieve that impact only if we bring parents and families with us. I pay tribute to my hon. Friend, who has been a remarkable champion, particularly for bereaved families in his constituency who have experienced the utmost tragedy and, through it, have shown the most remarkable resilience.
Sir John Whittingdale (Maldon) (Con)
While I welcome the Government’s belated intention to act in this area, does the Minister agree that there would be no need to wait for legislation if the social media companies actually started to enforce their existing age requirements for participating online? Many children under the age of 13 are able to create accounts and interact, despite the fact that that is completely against the terms of the platforms.
Kanishka Narayan
The right hon. Gentleman is totally right. Social media companies are already required to enforce the age assurance thresholds that they face under existing legislation. Where that is not happening, we continue to back Ofcom to ensure that it acts robustly and uses every single power it has. We will continue to review whether more is needed to ensure that that is robust action.
Ms Julie Minns (Carlisle) (Lab)
It has been more than 20 years since I was one of half a dozen people who co-wrote the world’s first code of practice to protect minors from age-inappropriate content. One of the biggest challenges we faced then was age verification. Will the Minister assure us that the technology and the devices are now there and in place so that under-18s can verify their age?
Kanishka Narayan
I have been very conscious of my hon. Friend’s expertise in this domain, but I am glad to hear of her pioneering experience on the question of age verification, too. We have taken this action because, through our engagement, we have made sure that the technology is now in a good place to robustly verify the age threshold of 18. That is why we want to see it extended, to make sure young people are secure online.
Suella Braverman (Fareham and Waterlooville) (Reform)
I have met victims of online sexual exploitation—it is an absolutely devastating crime that needs to be stopped. However, I fear that the Government’s plans are going to make things worse for everyone while taking little action to protect children online. The Australian model has not worked, and I fear that these Government plans will effectively open the door to state-mandated surveillance and digital ID for the entire population. We all want children to be safe online. Brilliant technology exists, such as parental control software and other excellent mechanisms; can we not use that technology more, rather than imposing an authoritarian ID database on the entire population?
Kanishka Narayan
That is a remarkable mischaracterisation of what the Government are looking to do, and I think the bulk of the House will feel the weight of what the right hon. and learned Member has just said. There is a straight choice here between backing parents and their families in a context where they are experiencing remarkable difficulties in keeping up with modern technology, and backing platforms. I am astonished that she has said that the Reform party is backing tech billionaires and platforms, not parents.
Naushabah Khan (Gillingham and Rainham) (Lab)
Unfortunately, I do not believe that the tech giants will do as they say and act in the right way on this issue. What consideration is the Minister giving to legislation, particularly to ensure that all platforms can meet the same standards, but also so that we can future-proof against new platforms?
Kanishka Narayan
I share my hon. Friend’s scepticism, so let me say two things. The first is that actions matter more than words, and we have already demonstrated that we can move in a pioneering way through the world-first action that we were able to take regarding a major operating system earlier this year—a move that has been praised by international partners. Turning to my hon. Friend’s point about law, as I mentioned at the outset, the Home Secretary, the Home Office and I are working closely together to prepare law in parallel, to ensure no stone is left unturned when it comes to securing our young people’s future.
Alicia Kearns (Rutland and Stamford) (Con)
I welcome the Government’s belated move on social media, but can the Minister clarify whether the technology prevents photos from being taken in the first place, or whether it scans people’s devices to prevent them sending photos? There are understandable privacy concerns. The Minister’s Department has also briefed the media that YouTube Kids will be excluded from any such action by the Government. Can he explain why?
Kanishka Narayan
On the hon. Member’s first question, while we will continue to look at the most effective ways of making this happen, the existing technology largely uses classifiers that ensure that, even at the point of taking the images, camera rendering can prevent those photos from being taken. On her second point, she will be aware that as a matter of course, I will not comment on briefings.
Laura Kyrke-Smith (Aylesbury) (Lab)
I have spoken to many young people in Aylesbury and the villages about this issue. One boy told me about the content he had seen, from terrorist beheadings to sexual abuse. He said to me, “Please don’t stop us communicating with our friends—we want to do that—but please stop us seeing this illegal and traumatising material, and please help us manage our addiction to these social media platforms.” Does the Minister agree that the tech companies cannot be trusted with our children’s safety or their futures, and that the Government have to step in now?
Kanishka Narayan
I agree entirely with my hon. Friend—she has also been a persistent campaigner on this question, and I have valued her input and the conversations I have had with her. Clearly, the experiment that we have allowed our young people to be a part of has not worked; we must bring it to an end, and we will do so robustly and imminently.
Vikki Slade (Mid Dorset and North Poole) (LD)
I welcome the proposals announced today, but I am concerned that they appear to be limited to nudity. Children who have been subjected to self-harm content or who have been encouraged to take their own lives, and those who have seen extreme violence, do not appear to be covered. My son George told me that without any attempt to find them, he was fed the images of Charlie Kirk’s murder pretty much as soon as it had happened, and I do not see anything in this change to prevent something like that from happening again. Can the Minister confirm that it will include measures on extreme violence, as well as on those awful sites that are causing children to hurt themselves?
Kanishka Narayan
It is valuable that the hon. Member has raised those particular harms. I assure her that extreme violence and self-harm content of the sort she has described are already significant and priority offences under the Online Safety Act. Platforms have liability for making sure that that sort of content is proactively rooted out, and where that is not happening, the regulator has the powers it needs to act against it and will continue to do so. The particular change we are considering is about a very specific classifier of nudity—it is much harder to build classifiers for particular types of violence. However, I will of course continue to work with the hon. Member, and any other Members who are interested, on what more we can do.
Tom Collins (Worcester) (Lab)
I welcome the Government’s position on this issue. We know that the technology is capable and present. I have spoken to those in the UK developing it, but it is being realised against headwinds, because there is no pull. For every other product area or technology, consumers rightly expect safety, and that is built into our product safety laws, but that is not the case with digital. There is no pull for this technology from the big tech companies. Does the Minister agree that we should move in a direction that creates this pull for innovation, for safety as a value and for technology that delivers safety? Such innovation could be enriching our economy as much as the technology at the moment is threatening people’s health.
Kanishka Narayan
Safety by design is an incredibly important principle. I valued its mention in the online safety legislation and in our engagement with companies. It is an attractive and tractable way of driving change, too. My hon. Friend has done extensive work on this issue, and I look forward to engaging with him in depth to make sure that his ideas feed into our decisions.
Sir Julian Lewis (New Forest East) (Con)
As long as children are given access to social media I very much doubt that it will be possible to prevent them from seeing harmful content. Given the strong assurances from the Minister that he will certainly be taking action to prevent them from seeing extreme content, can he explain to the House what sanctions will be available effectively to punish those social media companies that defy the legislation?
Kanishka Narayan
The existing legislation provides for significant fines. More than 100 investigations have been conducted, and millions of pounds of fines have been levied on companies for inaction, too. Under any prospective new regime, I will make sure that the enforcement levers are as robust as they can be. The clear lesson from elsewhere is that compliance is critical to reshaping norms, and I want the companies and the bosses to feel the weight of that.
Jim Dickson (Dartford) (Lab)
I thank the parents, teachers and young people in Dartford who came together with me at the end of last month to discuss how to take action against what social media companies are engaged in, which has been described as the great rewiring of our childhood. I was pleased to be able to provide a report to the Minister’s Department after that engagement. There was near consensus that we want to see age restriction on social media access, a digital age of consent on data access and more guidance for parents and families from trusted sources. Does the Minister agree that it is vital that we take steps in all those areas, as well as the welcome announcement today on smartphones?
Kanishka Narayan
I thank my hon. Friend for the engagement he has done and for sharing the lessons from it across the three areas that he talks about: age restrictions, the ability to wield appropriate consent, and guidance for parents. The central theme is that parents and young people feel a loss of agency, and that is exactly the fundamental focus that this Government have: to restore the agency of people over platforms.
Seamus Logan (Aberdeenshire North and Moray East) (SNP)
There remain serious concerns about the ability of children to use livestreaming on social media and the risks and harms that may arise. That issue has been raised by my hon. Friend the Member for Aberdeen North (Kirsty Blackman) in the past. In addition, Members will be well aware of the risks posed to children by strangers, who are in some cases adults with malevolent and illegal intent. Will the Minister confirm that livestreaming and the protection of children from these predators will fall under the scope of the forthcoming Government response?
Kanishka Narayan
The hon. Member raises important points about livestreaming and what is called stranger pairing, which is the ability for strangers to engage with young people online on a series of platforms. Livestreaming and stranger pairing together seem to me to be an important way in which international criminal networks have undertaken child sexual abuse. It is at the top of our minds as we think about regulating functionalities and features that are some of the most challenging aspects of what drives harm for young people.
Lola McEvoy (Darlington) (Lab)
I thank the Minister for answering this urgent question today, and urgent it is. While the tech companies are spending millions of pounds congratulating themselves on how they are going above and beyond, children in Darlington tell me that the parental controls are really easy to work around. Can the Minister outline how these new settings on devices will be safeguarded to make sure that children cannot toggle them on and off to regain access to functionality?
Kanishka Narayan
My hon. Friend has been extremely thoughtful before in relation to these issues, and I agree with what she has said. In my experience with young people and families, parental controls have not been easy to engage with, and nor have they been completely effective in driving down the harm in question. As for the effectiveness of what we have announced today, there is clear evidence that age assurance at device level has already been effective in some instances. The technology also appears to be pretty effective in understanding nudity and therefore blocking it. We are looking at that precisely, because we think it is radically more effective than age assurance just at the level of the application. I will continue to bear my hon. Friend’s lessons in mind.
Sir Gavin Williamson (Stone, Great Wyrley and Penkridge) (Con)
In my constituency, this issue is of real concern to parents as well as children. Some of the big tech companies seem to resemble the big tobacco companies of the 1960s. We have had a great deal of briefing from the Government, and we have had an announcement that was not made in the House. Will the Minister commit himself to coming to the House when the guidance is ready, to set out exactly and clearly the steps that the Government will continue to take to give real reassurance to the parents in my constituency who are so concerned about this matter?
Kanishka Narayan
The Government are already committed to a conversation as well as a vote in the House on the substantive question of the consultation. I will ensure that there is even fuller scope for engagement in the Chamber on the full set of questions that the right hon. Member has raised.
Jess Brown-Fuller (Chichester) (LD)
Many Members will have read “Careless People”, a book by Sarah Wynn-Williams. It is a whistleblowing account of her time working inside Facebook, now Meta. She was silenced by Meta, using lawfare, when she sounded the alarm. These companies do not care about the people who use the platforms. They care only about keeping people on their platforms, especially our children. What does the Minister know that we do not? Does he believe that asking them nicely, rather than legislating against them, will achieve the intended results,?
Kanishka Narayan
One of the things that I value most in this role is the ability to engage directly with whistleblowers from a range of companies, and to hear about their understanding of what is happening internally but, more than that, the strength of their prescription. I am not relying on any internal, privileged understanding; I am relying on action, not words. The fact that we have already been able to secure a world-leading change in respect of age assurance at device level, protecting millions of young people in this country, is the action on which I am relying, not false promises or privileged information.
Sarah Russell (Congleton) (Lab)
The tech companies are big, they are rich, they are clever, and they are playing a very long game. I do not doubt that in the next three months we shall see some degree of compliance or movement towards what the Government are asking for from those tech companies, but I fear that there will then be constant backsliding—that we shall see them endlessly rowing back on, or not quite meeting, what they have agreed to. How can we prevent that from happening by means of any steps short of legislation? Could legislation please be enforced by means of class actions for children who are damaged by this content? I think that that is the only thing that the tech companies might pay attention to.
Kanishka Narayan
My hon. Friend is right to say that the issue of concern is not whether there are some incremental changes but whether our children are safe online, and that is at the forefront of my mind. We are looking at the quickest way of achieving such an outcome. We are preparing legislative options alongside the engagement that we are already carrying out, and if we are not able to secure substantive change to deliver that outcome, we will not hesitate to legislate.
Leigh Ingham (Stafford) (Lab)
A little while ago I ran a consultation in my constituency with 60 young people and teachers, which the Minister kindly attended. While they would welcome the action taken today, they wanted to see significant regulation of tech companies, because a ban is easily avoided. What further steps are the Government considering to protect young people through regulation?
Kanishka Narayan
One of the firm lessons that I learned from my hon. Friend’s engagement—and such depth of engagement—with young people in Staffordshire was the need to ensure that the changes we make online also reflect better opportunities offline. I know that she provides extensive opportunities for young people in her constituency. We will make sure that when we are acting on this issue, we are looking at the full range of their experiences.
Greg Smith (Mid Buckinghamshire) (Con)
I am genuinely pleased that the Government have at least come to the table on preventing harms to children from social media and online content, but it strikes me that it is rather piecemeal. Listening to voices on the Conservative Benches, other parties in opposition and the Government’s own Back Benchers, it seems everything is pointing in the same direction: we need an outright ban on social media for under-16s. This House has proven in the past that when we want to act quickly, we can. Before any more children are harmed, will the Minister bring forward legislation?
Kanishka Narayan
With respect to the hon. Member, there are a range of questions, not least about how we make sure that we do not allow harms on gaming and messaging platforms. We need to look at the precise way in which age assurance can be robust enough, so that we do not get young people escaping any changes. There are a range of implementation questions. We want to get this right for our young people and families, not give in to political back and forth.
Sonia Kumar (Dudley) (Lab)
Health misinformation and disinformation on social media is not harmless; it is a growing and serious threat to public health. We have already seen cases in which harmful online trends have led to severe injury and, tragically, even to the deaths of children. What steps are the Government taking to hold technology companies to account, and to prevent online influencers from being able to spread harmful and misleading health content on their platforms, given the clear risks that they pose to young people?
Kanishka Narayan
My hon. Friend makes a really important point. One of the things that we have been clear about is that regulated health advice should be provided only by regulated individuals in appropriate ways. The platforms need to ensure that they comply with that, and we will work with the regulator to ensure that any such responsibilities are carried out.
Adrian Ramsay (Waveney Valley) (Green)
At a recent roundtable that I held at a high school in Waveney Valley, one young person said:
“Social media is dangerous for young people and the government needs to take more control over social media companies because of the harmful content”.
A senior teacher said:
“The majority of what we are dealing with as safeguarding leads is via social media.”
How will the Minister ensure that the out-of-control corporate tech giants are regulated effectively, so that only age-appropriate content can be accessed?
Kanishka Narayan
The central message that the hon. Member should take away is that this Government will make sure that we restore control to the hands of families, rather than tech bosses. That is the outcome that we will deliver imminently.
Jonathan Davies (Mid Derbyshire) (Lab)
Parents, teachers and young people in Mid Derbyshire have spoken to me extensively about the harm that young people are receiving from social media and smartphones, but it is worth noting that many young people get their legitimate news content online. They also have a lot of access to educational material on places such as YouTube, and we have to be careful not to push young people towards more harmful places on the internet through legislation. What steps will the Minister take to ensure that young people can still get their legitimate news online? They are not engaging with traditional broadcasters or buying newspapers, and they need to access their educational content. We do not want there to be any unintended consequences.
Kanishka Narayan
My hon. Friend makes an incredibly important point. On all my travels across the country, I have tried to be active on social media, but the only content that young people report having seen is on “Newsround”. Public broadcasts of appropriate, high-quality news and educational experiences can be delivered in innovative ways in schools, as well as online. This Government will make sure that young people are kept informed and are in receipt of educational experiences.
Mark Pritchard (The Wrekin) (Con)
This country is in danger of losing a generation of young people to the bad and malign influences of big tech. Big tech can be a force for good, but are this Government not completely embedded with big tech, as the last Government were? Big tech is often more powerful and has bigger budgets than many Governments, and some of the big tech owners do not believe in democracy; they believe that democracy is bust and want to undo it. There is an inherent conflict of interests between the Government’s position and big tech’s influence and embeddedness in all Government Departments. It is incumbent on all of us to take action, because parents feel powerless. They look to us as their Members of Parliament to reflect their views, and today I am reflecting my constituents’ views. As we have heard from Members across the House, guidance is not good enough. It has to be about legislation, class actions and big bucks—that is what these companies listen to.
Kanishka Narayan
The right hon. Member makes an incredibly important point. First, of course we will act, including in law, to make sure that we are focused on outcomes for young people and families. Secondly, and critically, the conversations I have had across the country reflect a deep understanding that we need robust action in the short term, but in the long term Britain will shape technology, rather than being shaped by it, if we build British capability. That is what we are focused on. In fact, just this morning we announced a £1 billion hardware plan to make sure that the next generation of fundamental technologies—AI chips in particular—are built here. We are reindustrialising ourselves but, at the heart of it, making sure that we have the discretion to engage with international firms in the way that we want.
Johanna Baxter (Paisley and Renfrewshire South) (Lab)
I thank my hon. Friend for his response to the urgent question. I am very grateful that the Government are taking action on this vital issue, but we all know that the pace of change in technology is terrifying. Will he set out how the discussions with technology companies and online safety experts have focused on ensuring that device-level controls are not only effective and easy for families to use, but adaptable to emerging online risks?
Kanishka Narayan
My hon. Friend makes the incredibly important point that the speed of technology needs to be reflected in the speed of democracy. That is why we have moved so fast in engaging the country, getting a set of actions ready and acting imminently. On device-level changes, although we were one of the first countries in the world to secure major changes to an operating system earlier this year, she is totally right that we must look not just at where the technology is now but at where the harms may go, and I will continue to bear that in mind.
Ann Davies (Caerfyrddin) (PC)
I welcome the Minister’s announcement about blocking explicit images on children’s phones, but this should really have come much sooner. I totally agree with the hon. Member for Twickenham (Munira Wilson) that action needs to be taken now, not in three months’ time. What exactly will be measured at the end of that period, and what counts as failure? Are we really relying on the good will of tech companies, bearing in mind their inactivity so far?
Kanishka Narayan
I thank the hon. Member for her question. Let me give a very clear sense of that outcome and how we will measure it. Currently, 91% of the images used in child sexual abuse interactions are self-generated. To me, that is the central focus for what this Government are doing. We have already made a significant difference, as I have said, in ensuring that our robust engagement delivered a pioneering change to a major operating system. If this change is not delivered within weeks, we will ensure that the full force of the law delivers such an outcome.
Chris Webb (Blackpool South) (Lab)
There is growing evidence of a link between smartphone overuse and symptoms of depression and anxiety and reduced student performance, and areas such as Blackpool are seeing double the national average of young people self-harming. What steps will my hon. Friend take to ensure that device-level controls are effective and easy to use for parents who may not be tech savvy?
Kanishka Narayan
A fundamental principle behind both the changes announced today and those we are considering as a result of the consultation is simplicity. Parents across the country tell me that they are working incredibly hard to try to keep up with the technology, but the technology continues to make it more difficult rather than easier for them to exercise control. That principle will motivate our actions, and we will ensure that this is easy and effective, and that the burden of liability falls on platforms, not parents.
Lincoln Jopp (Spelthorne) (Con)
Why is the Minister answering an urgent question rather than bringing forward a Government statement?
Kanishka Narayan
I understand that Home Office Ministers made a statement at oral questions. I am happy to answer any further questions from Members of the House.
Josh Dean (Hertford and Stortford) (Lab)
The vast majority of Members in this place had the benefit of growing up in a world without social media, and with social media, but today’s young people have not had that benefit. They have grown up with their lives intimately intertwined with the digital world, and in lockdown they were pushed even deeper online without being given a say. Whatever we do next, we must bring young people with us. Beyond the consultation, what will the Department do to meaningfully engage with young people in this area of policy, so that we can build a digital world that is safe for young people with young people?
Kanishka Narayan
My hon. Friend has been one of the most vocal Members on this question, particularly on engaging with young people. There are two things on my mind. First, there is the trust that I have felt in engaging with young people in every nation and region of our country on these questions. Whether over basketball, cricket, football or netball—and, indeed, toasting marshmallows with the Cumbria scouts—my trust has only been affirmed. Secondly, he is right to raise an important point about finding a community online, particularly for young people from LGBTQ groups and rural groups. We must bear that in mind and ensure that they have appropriate resources to feel supported in forming such communities.
Monica Harding (Esher and Walton) (LD)
At the G7 Digital Ministers meeting, it was reported that the US and the UK watered down stronger protections for children presented by France. My constituents, as evidenced by more than 2,000 emails I have received on online harms, want stronger protections. Will the Minister assure us that on online safety he and the Prime Minister have the interests of children in my constituency at heart, rather than the interests of the US and big tech? If so, why did the UK resist mandatory protection frameworks?
Kanishka Narayan
I will not be commenting on leaked briefings, but I will say two things. First, in my engagement, even in Australia, civil society has said that the United Kingdom has been the first country in the world to pioneer the changes to operating systems that are securing young people’s future. On children’s safety, the only thing that matters to this Government is ensuring that British children are kept safe. We will continue to make that the defining principle for all our actions.
Sureena Brackenridge (Wolverhampton North East) (Lab)
Tech giants have had the digital level controls capability to stop children taking, sharing or viewing naked images on their devices, but have failed to do so. I have very little confidence that they will suddenly have an epiphany and do the right thing without the necessary pressure, enforcement and consequences. How will the Minister ensure they comply, and if, or when, they fail, legislate with urgency?
Kanishka Narayan
I share my hon. Friend’s starting position of scepticism. Robust action will be achieved by ensuring that the outcome is a significant reduction in child sexual abuse material propagated through the mechanisms described. In the absence of that happening within weeks, we are preparing law in parallel to ensure that such action is not deferred.
Sammy Wilson (East Antrim) (DUP)
Regardless of what has provoked this change of heart, we can all welcome the Government now recognising the harms caused to children and families by social media. The evidence is very clear. I believe that most children will support the legislation. On Friday, I chaired a debate— a lively debate—at Roddensvale special school. All the points about disruption, distraction, bullying, peer pressure and so on were brought up. One thing I would ask of the Minister is that we need action now. He should not be put off by further promises from the big tech companies about self-regulation. If we are to have action, it should be enforceable and there should not be unintended consequences for free speech.
Kanishka Narayan
I thank the hon. Gentleman for his point. When I visited young people in Glengormley in Northern Ireland, they told me that it was the first time they had been engaged on this question so systematically; and yes, they wanted robust action, but action that worked in the real world—they use different apps as well as virtual private networks. On the broader question of social media, the Government are not just listening but acting robustly and in a way that is distinctive. On the specific question of device-level interventions, the fundamental focus will be what delivers the most robust action the quickest. If that is the law, we will pursue the law. If it is engagement and the way that we have already delivered significant changes, we will do that. The future of young people is the critical driver here.
Dr Scott Arthur (Edinburgh South West) (Lab)
I thank the Minister for his statement. It really does feel like change is coming and I know that parents in Edinburgh South West will welcome that. On the proposals to restrict social media access for young people, the Minister has rightly been listening to parents, but what work is he doing with campaigning charities such as the Lucy Faithfull Foundation, whose knowledge and expertise is extremely important in this domain? This also cannot be about a Government-led ban: we must engage our young people, schools, parents and charities in communicating the changes we plan. It would be good to hear more on that from the Minister. Lastly, if the industry does not proceed with a voluntary ban, how long does the Minister think it would take to implement a full ban on the ground?
Kanishka Narayan
I thank my hon. Friend for his incredibly important point. One reason we have ensured that we engage young people and families alongside civil society is that there is a depth of experience across the country. If we are to achieve change not just on devices but more broadly on social media norms, those who engage in places that matter with young people and families must be right at the heart of that. I will ensure that civil society charities across the country engage with us not just on the decision but on its communication.
Shockat Adam (Leicester South) (Ind)
I refer Members to my entry in the Register of Members’ Financial Interests as a practising optometrist. Myopia—shortsightedness—is nearing epidemic levels for UK children. It is a crisis that was sharply increased by covid, when screentime surged and outdoor activity collapsed. Research shows that nearly one in three of our UK children will now be short sighted, and the rate is still rising. Shortsightedness after a certain dioptre level can lead to retinal conditions and sight loss. When developing any digital policies, can consideration be given to the devastating impact of screentime on our children’s eye health?
Kanishka Narayan
The hon. Member raises an important point, and I will ensure that it is fully considered in the evidence that we include when making decisions on that question.
Chris Vince (Harlow) (Lab/Co-op)
I thank the Minister for his response to the urgent question; I have always been a big fan of his style. I echo the points made by the Father of the House on the importance of holding social media companies to account. The Minister will not be surprised to hear that I have done extensive consultation with parents, teachers and young people in my constituency of Harlow about the issue. I also echo the comments made by the Chair of the Education Committee, my hon. Friend the Member for Dulwich and West Norwood (Helen Hayes); I do not think that social media companies are taking their responsibilities seriously. Does the Minister agree that some sort of social media ban—which would be a good idea—will only be effective if we ensure that the technology does not allow people to circumvent the age-verification tools? That is very important.
Kanishka Narayan
Not even my mother has complimented me on my style, so I can confirm to my hon. Friend that a visit to Harlow is imminent. He is totally right, and one reason that we have taken time to ensure that we are engaging with families and young people is to understand exactly how age-verification technology works, as that is crucial to whether we look at a platform ban or features and functionalities limitations. We want to get it right and robust so that young people in this country are kept safe.
Lincoln Jopp
On a point of order, Madam Deputy Speaker. A few moments ago, I asked the Minister why he came to the Floor of the House to answer an urgent question rather than bringing forward a Government statement. I believe his answer was that he thought Home Office Ministers had made a statement earlier today. The Minister and I are both new to this House, but given that statements tend to follow oral questions— I sat through Home Office questions—and there has not been one, the Minister may have inadvertently misled the House. What opportunities are there for the record to be corrected?
Madam Deputy Speaker (Caroline Nokes)
I thank the hon. Gentleman for his point of order. The Minister will know that in the first instance statements should be made to the House. Today we have had an urgent question to address the issue. If there has been any inadvertent misleading of the House from the Minister’s use of language, I am sure that those on the Front Bench have heard that and will want to clarify the matter.
Kanishka Narayan
Further to that point of order, Madam Deputy Speaker. I heard the Home Secretary deliver a statement at the start of topicals. It may not have been the fullest format, but it was a clear statement of the policy. I am of course happy to keep answering questions for as long as the House likes.
Water Companies
(1 day, 5 hours ago)
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Clive Lewis (Norwich South) (Lab)
(Urgent Question): To ask the Secretary of State for the Environment if she will make a statement on the performance of the water sector.
The Parliamentary Under-Secretary of State for Environment, Food and Rural Affairs (Emma Hardy)
I welcome this opportunity to update the House on the progress the Government have made on this important issue. In these divisive times, there are few topics that unite all of us in this House—but water does. We all agree that the status quo cannot continue. Following 14 years of Conservative failure, this Labour Government are turning it around, but there is still lots more to do.
I have been grateful to meet with many passionate campaigners and Members of this House. Recently, that included an engaging meeting with my hon. Friends the Members for Norwich South (Clive Lewis) and for Shipley (Anna Dixon). Just last week I met with campaigners from Save Windermere and academics from the People’s Commission on the Water Sector.
People are right to be angry about the problems facing the water industry. Customers have been let down by rising bills, under-investment in creaking infrastructure, supply interruptions and unacceptable levels of pollution in our rivers, lakes and seas.
That is why this Government took action on day one by updating the water companies’ articles of association—the foundational legal documents that outline their internal rules and purpose—to put customers and the environment at their heart. We also established powerful consumer panels to give customers a voice. In week six of this Government, we introduced fundamental reforms through the Water (Special Measures) Act 2025, ringfencing customers’ money, banning unfair bonuses, introducing criminal liability for polluting water bosses and creating automatic penalties for wrongdoing. Within a year in office, this Government had changed the guaranteed standards of service, doubling compensation for customers when things go wrong. Following that, we gave the Environment Agency more money and more power to monitor water companies, enabling it to deliver a record 10,000 inspections. After that, we strengthened protections for vulnerable households by changing the reforms around WaterSure to ensure that vulnerable people did not face excessive bills.
No one solution is going to fix the whole water industry. Since I have had the honour and privilege of being in this position, my focus has been on finding the quickest and most effective way to deal with each of those structural challenges. That is exactly why this Government are delivering the once-in-a-generation reform through our clean water Bill to reset the water sector and end the cycle of decline. And because the Government believe in experts, we have also supported the chief medical officer in bringing together a wider expert panel through the public health water taskforce, providing independent and technical advice on risks, alongside the fantastic work done by the Department for Environment, Food and Rural Affairs’ own scientific adviser, creating the science advisory council to look at what we can do around water.
We will deliver on our promise to clean up our rivers, lakes and seas not just today, but for generations to come. These changes are designed to address the structural challenges in the sector and to deliver a cleaner, more resilient and more accountable water system for the future.
Clive Lewis
I thank the Minister both for her response and for putting up with me—I am a bit of a broken record on this issue. We are all well aware that water is essential to life itself—to food, industry, nature, housing, energy, and now even the data centres powering the supposed AI revolution—and yet we have handed a monopoly where no competition is possible to companies, many owned overseas, whose overriding priority is profit. The result is systemic failure, with not one major reservoir built and the old ones sold off. That is why we were back in the Chamber last week over South East Water and the drought outages, just weeks into the summer.
Raw sewage has poured into our rivers and seas—3.5 million hours of it in 2024 alone—fouling beaches where children swim. It is why eight-year-old Heather Preen died after contracting E. coli from raw sewage, and why thousands of our constituents are made sick every year. When public anger saw the Government ban bonuses, water execs raised their salaries and rebranded the payouts “retention payments” and that comes on top of the £78 billion to shareholders and £60 billion borrowed, our bills up 40%, and 30p in every pound we pay servicing water companies’ debts instead of fixing pipes.
This was never a market failure. Instead, it is the market working as designed—profits out, sewage in, cost of living up and security of supply decimated. Surely the Minister understands that we can no more regulate privatised water companies than regulate the tide. How many more failures, inquiries and deaths before the Government accept that these problems are systemic and give the public the option of taking their water back?
Emma Hardy
I thank my hon. Friend for his question. He is right that he has been passionate about this matter for a long time. We have known each other a very long time, and—I have said this to him before—I genuinely admire and respect his passion. I know what it means to him. In fact, he was the person responsible for bringing Julie, Heather’s mum, to meet me when they came to Parliament for a premiere of “Dirty Business”, which I found really moving.
My hon. Friend knows I am going to agree with him on reservoirs. It is shameful that we have not had one built. Our climate is changing: we are facing drought in the summer and we have too much rain in the winter, and yet we cannot seem to hold it. That is a fundamental failure.
He knows my thoughts on South East Water, too, as well as my feelings about competition, which is why I think we should be introducing more new appointments and variations. As I said last week, where a water company might want to transition to a new ownership model such as not for profit, we are committed to developing a transparent process to look at whether that request should go ahead—a process that has never existed before.
Dr Neil Hudson (Epping Forest) (Con)
Labour came into government promising major reform of England’s water sector, but progress so far has been slow. The Water (Special Measures) Act 2025 was largely a rebadging of many Conservative reforms. During its passage, we tabled many sensible amendments, including ones to ringfence funding from enforcement fines to a bespoke water restoration fund; to guarantee that companies fixed the environmental damage they caused locally; to require Ofwat to create rules on financial reporting in its remuneration and governance rules; to reduce consumer bills if companies were hit with enforcement fines; and to ensure that companies did not leverage too much debt. Sadly, the Government failed to support those amendments and missed the opportunity to increase accountability.
We on the Conservative Benches have been clear: no one wants to see water companies such as Thames Water collapse. Although water supply would continue, failure would expose taxpayers to billions of pounds of liabilities and drive customer water bills sharply upwards, without addressing the underlying issues. Yet we have seen the third party in this place lead legal action that could have pushed Thames Water to the brink, and both they and Reform appear relaxed about the consequences for consumers and the public purse. Government have to be prepared to step in if a company fails, but that should be a last resort, so can the Minister update the House on the current situation at Thames Water?
Last week, this House again debated further unacceptable water outages from South East Water. With further hot weather expected, what action are the Government taking to ensure that water supplies are not disrupted again and that people, businesses, schools, hospitals and livestock owners will have sufficient water? Turning to the wider systemic issues in the water sector, can the Minister update the House on progress towards delivering new reservoirs and other strategic water infrastructure? Finally, can the Minister explain how the Government are tracking investment commitments across the sector?
Emma Hardy
I think the shadow spokesperson managed to read his statement out without actually listening to the answer that I have given. But I am always keen to update everybody on the action we have already taken, so just in case he missed it, I am happy to say it again. We have passed the Water (Special Measures) Act 2025; ringfenced customers’ money so that it cannot be diverted away from investments; secured £104 billion of private investment to upgrade our infrastructure; given the EA more powers to monitor water companies; banned unfair bonuses; introduced criminal liability for water bosses; introduced automatic penalties; reduced the burden of proof for many offences so that regulators are on the front foot; introduced cost recovery to shift the cost of pollution on to those who pollute; banned the sale and supply of wet wipes; reformed our bathing water regulations; established the water delivery taskforce; more than doubled compensation for customers when things go wrong; and introduced strengthened protections for vulnerable households through reforms to the WaterSure scheme. In fact, I would say that we have done more in 20 months than the hon. Gentleman’s Government did in 14 years.
Madam Deputy Speaker (Caroline Nokes)
I call the Chair of the Environmental Audit Committee.
Mr Toby Perkins (Chesterfield) (Lab)
My hon. Friend the Minister is absolutely right to say that we are united by our anger about the systemic failures in the water industry, in terms of both financial and environmental regulation, and the under-investment in infrastructure over a long period—although the fact that Welsh Water, a not-for-profit water company, is also a poor performer when it comes to the environment shows that it is simplistic to say that profit is the only issue here.
The Government have rightly addressed one of the issues—the amount of investment going in—but we need to see results from higher bills, and we also need to see regulatory reform as soon as possible. Will the water Bill tackle the environmental failures and also put in place a regime that prevents the kind of appalling indebtedness that we saw with Thames Water, and the industry more generally, and the prioritisation of those debts ahead of delivering for customers?
Emma Hardy
I thank my hon. Friend for his work as Chair of the Environmental Audit Committee. He is right to highlight the under-investment in infrastructure. In fact, some of the problems around resilience are, quite frankly, due to the under-investment in infrastructure, which is why we need to set resilience standards. He is also right that we need to see action resulting from higher bills, which is why we formed the water delivery taskforce to hold the water companies to account for the promises they have made on delivering infrastructure.
On the point about having an integrated regulator, at the moment Ofwat looks at things financially, the Environment Agency looks at the environment and the Drinking Water Inspectorate looks at drinking water. By abolishing that and bringing the regulator into one, we will have an integrated regulator that places the environment, customers and—what has been missing for the last 14 years—public health at its heart, which is incredibly important. Finally, I agree with him about debt levels; that was one of the things in the Sir Jon Cunliffe commission.
Madam Deputy Speaker (Caroline Nokes)
I call the Liberal Democrat spokesperson.
Charlie Maynard (Witney) (LD)
Thames Water, which serves my constituency, embodies the systemic failures of the sector. The company is in breach of its licence conditions by not having held any investment grade credit ratings for nearly the last two years and by failing to inform Ofwat and the Government of the change of control at the company. The Government have stood by and let that happen. Now, their only plan is to hand the company over to the very same creditors who have pillaged, and continue to pillage, it. They must now change course, put Thames Water into special administration and bring it out as a business that is mutually owned and operated in the interests of its customers and the environment.
I find the shadow Minister’s words extraordinary—he comes across as a corporate shill. I have provided him with information from Thames Water’s own independent expert that demonstrates that the cost to the Government will be zero in the medium term, but he has not responded. Will the Government please now put the company into special administration?
Emma Hardy
I thank the hon. Member for his question, but I think it is a misrepresentation—I am sure it was an accident—to say that the Government are doing any kind of deals. The Government are working closely with Ofwat, which is evaluating the consortium’s proposals. Of course, the Government will always have the best interests of customers and the environment at heart. As I have said many times in the House, we stand ready for all eventualities, including applying for special administration if necessary.
Helena Dollimore (Hastings and Rye) (Lab/Co-op)
In Hastings, Rye and the villages we have had sewage dumped in our sea, two major water outages—lasting five and nine days—Hastings town centre flooded and, last year, as the Minister knows, 300 million plastic beads washed up on our beaches all thanks to Southern Water. Its failures are making people sick, damaging local businesses and tarnishing our livelihood as a seaside economy. That is why so many of the people I represent are fed up with Southern Water, while having to pay more in their bills. They welcome the action that the Labour Government are taking to ramp up regulation, ban bonuses and much more, but they want to know what more can be done. The water White Paper, which she has brought forward, talks about the importance of ownership and opens the door to the Government looking at not-for-profit structures. Could she say a bit more about that?
Emma Hardy
I thank my hon. Friend, who continues to be a formidable, incredibly impressive campaigner, as she was through her work on the Environment, Food and Rural Committee; honestly, she has been amazing. We have set out our White Paper, and a transparent process will look at whether a new model will go ahead. As the Secretary of State has also said, I have always been in favour of mutuals, and I do not have a problem with not-for-profits, but we need a clear look at the process to see whether that would be in the best interests of customers before any change goes ahead.
Sir Jeremy Hunt (Godalming and Ash) (Con)
Is not the root problem a profound failure of regulation over the last 25 years, for which Labour, the Conservatives and the Lib Dems all bear responsibility? We have regulated for lower prices and more investment, but we have not stopped companies from loading up their balance sheets with debt, which means higher prices and less investment. I am not a believer in nationalisation, because I know from having been Chancellor that the state will never find the £104 billion now promised by the private sector, but if we are to stick with private companies, do we not need to regulate differently so that we have lower prices and more investment?
Emma Hardy
I thank the right hon. Gentleman for his question—it still feels slightly odd to be on the opposite side of this, with him questioning me. I will gently say that, yes, I do accept the premise of his question—we need tougher and more effective regulation, because the regulation system has failed—but I would have thought that, as the second most powerful person in the previous Government, he might have had an opportunity to act himself.
Chris Hinchliff (North East Hertfordshire) (Lab)
We come to the Chamber almost weekly to highlight the failures of the water sector in our constituencies, but I want to highlight a wider point today. For years, economic policy in this country has been based on trying to achieve growth by unlocking private capital, often from abroad. In this essential sector, we are now seeing the end result: water bankruptcy, environmental devastation, non-existent infrastructure and the public left picking up the tab. What conversations is the Minister having with colleagues across Government, especially in the Treasury, about learning from this monumental failure?
Emma Hardy
I thank my hon. Friend for his passionate work on this issue. I know how much he cares about the damage that over-abstraction is doing to our environment and to nature. On the water delivery taskforce, we have Ministry of Housing, Communities and Local Government Ministers and Treasury representatives all looking at how we can make the fastest and most effective change to our water system. They look particularly at water infrastructure because, as has been highlighted already, one of the problems is that we have been unable to build the infrastructure we need, which is resulting in damage to the environment now.
Sir Roger Gale (Herne Bay and Sandwich) (Con)
Since Mr Speaker allowed me to ask an urgent question on Wednesday last week, to which the Minister helpfully responded, it will not surprise her to know that I have received quite a number of public comments concerning the performance of South East Water, most of which are not repeatable before the watershed.
Two issues clearly have come to light and struck a chord. First, it really is time that the water companies were allowed to act as consultees in planning applications, because we are building house after house after house without saying where the water is going to come from, and of course the water companies have a statutory duty to provide it. The second point that has come through loud and clear underscores something that the Minister said to me, which is that it really is time that every new house built had a grey water system, because we are pouring water that we cannot afford to waste literally down the drain.
Emma Hardy
I thank the right hon. Gentleman for this question, and for his question last week as well. As I mentioned last week, the water delivery taskforce looks at planning. It is looking jointly with MHCLG and the Department for Environment, Food and Rural Affairs at where we are building homes, whether we have the right water and what water infrastructure is needed. There has been some retrofitting of properties in Cambridge to make them more water efficient, but the right hon. Gentleman makes a powerful point about the use of grey water. That is definitely on my agenda.
Yuan Yang (Earley and Woodley) (Lab)
I thank the Minister for her statement. Tomorrow, I will be bringing Thames Water’s management into Parliament to answer a simple question: what improvements will my constituents get in return for the increases in their bills? My constituents do not feel they are being treated fairly by Thames Water, and that makes it even more important that Ofwat should reject the current deal proposed by Thames Water’s creditors to let it off the hook for polluting our rivers. Does my hon. Friend agree that fairness in the water sector means that the polluters and their investors have to be the ones who pay, not customers?
Emma Hardy
My hon. Friend is absolutely right to say that it should be a matter of fundamental respect to Members on both sides of the House that water companies inform Members of what improvements they are making and where. Each and every one of us will have had emails from our constituents about water bills and concerns about rising prices. The least those companies can do is inform customers where the money is going. I admit that some are, but Thames Water has so far failed to supply my hon. Friend with the information she has requested. I do not think it is unreasonable for her to request it, and I repeat my point to Thames Water that if bills are going up, the least customers should know is what they are going up to pay for.
David Chadwick (Brecon, Radnor and Cwm Tawe) (LD)
My constituents are disgusted by the sheer volume of sewage dumping that is happening across the River Tawe, the Usk and the Wye. Just two weeks ago, local children became ill after swimming in the Tawe, and the same happened last year in the Wye near Glasbury. Will the Minister listen to the Liberal Democrat calls to require water companies to publish the volume and concentration of sewage being discharged from emergency overflows?
Emma Hardy
This point came up repeatedly during the passage of the Water (Special Measures) Act 2025 and, fundamentally, my response remains the same, which is that the cost and time spent on installing monitors could be more effectively spent and used to prevent this from happening in the first place. That is why we want to focus on delivering the storm overflow reduction plan, which is looking to deliver £60 billion of investment across England by 2050 to reduce the number of overflows. Rather than trying to measure the problem, we are trying to tackle it.
Paula Barker (Liverpool Wavertree) (Lab)
Several barriers to taking water back into public ownership have been floated—pardon the pun—but the myth around the cost has been debunked and the impact on pensions has been dealt with by leading academics. What will it take for the Government to take water back into public ownership?
Emma Hardy
I know how much my hon. Friend cares about this issue, and she is right to highlight the concerns of some unions about changes. On nationalisation, as I have already mentioned, the White Paper contains a process by which different forms of ownership can be looked at, but—I do not wish to mislead my hon. Friend—that would involve looking at not-for-profits and mutuals rather than nationalisation.
Mims Davies (East Grinstead and Uckfield) (Con)
I know you have had your own issues with water, Madam Deputy Speaker. Given the dire ongoing issue with flies in Chailey, water outages due to heat, cold and storms, and a lack of confidence in infrastructure and drought planning, does the Minister think it is acceptable that Southern Water and South East Water remain separate? Would proper joint working and firmer accountability through partnership be the answer for my constituents, who are struggling with higher bills?
Emma Hardy
I have huge sympathy for the hon. Lady’s constituents; I remember our discussion of the previous situation, in December and January, and the impact on them all. She is right that the companies should be working more effectively together, and I am keen to support them in sorting out a proper legal agreement over the bulk supply of water from Southern Water to South East Water. Fundamentally, they have a duty under the Water Industry Act 1991 to ensure a supply of water; if they fail to comply with that duty, action will be taken.
Fleur Anderson (Putney) (Lab)
My constituents write to me constantly about the failings of Thames Water—bills going up, but pollution staying the same—and I am glad the Minister is taking a grip of the matter through the taskforce. It is World Oceans Day, and this morning I met several groups that are campaigning on and providing data about the impact of poor rivers on oceans. Can the Minister assure me that she is putting more effort into supporting the Environment Agency so that, as those organisations have suggested, it can better monitor the water and enforce the legislation we have passed?
Emma Hardy
Happy World Oceans Day, everybody—that is a good day to have. I pay tribute to my hon. Friend, because for years she led the campaign to ban the supply and sale of plastic-containing wet wipes, which were a huge cause of pollution, and we passed that ban partly because of her work. She is right that river pollution leads to problems with the oceans, and as Minister for water, flooding and the oceans, I have an interest in making all that work.
Monica Harding (Esher and Walton) (LD)
For more than a decade my constituent Holly, of Ferry Road in Thames Ditton, has watched Thames Water clean up raw sewage from her street, only to be told that the system is not fit for purpose, with nothing ever being fixed. In last week’s heavy rain, human waste flooded two homes and spread to the local primary school. Thames Water’s proposed solution is to wash it straight back into the river, which is unacceptable. This comes on the back of higher bills. Is it not time that the Government put Thames Water on a sustainable footing under special administration, so that it can at last invest in infrastructure, and Holly’s nightmare can end?
Emma Hardy
The hon. Lady raises a shocking and awful case, and I am more than happy to meet her and look into it. There is no excuse for sewage ending up in primary schools or floating down the street. I am happy to take that up.
Jas Athwal (Ilford South) (Lab)
Thames Water, which serves my constituency, has had a chequered history—it has gone from bad to worse—and there has been sewage on the streets of Ilford too frequently. When is enough enough? When will we take back control from Thames Water?
Emma Hardy
I thank my hon. Friend for his question, which provides yet another example of the current failure of the system. He is right to feel angry about it. As I have said, the Government are working closely with Ofwat in respect of Thames Water. We stand ready for every eventuality, including applying for special administration if necessary.
Sir Julian Lewis (New Forest East) (Con)
I would like to record my appreciation of the consistent campaign waged by the hon. and gallant Member for Norwich South (Clive Lewis), which included bringing the real-life activists on whom the “Dirty Business” docudrama series was based to the House of Commons where we could meet them. I noted what the Minister said in her reply to him about no new reservoirs being built. Does she think any new reservoirs could ever be built without direct Government intervention?
Emma Hardy
The right hon. Gentleman raises an incredibly important point. One of the things we have been doing through the water delivery taskforce is looking at all the potential barriers in the way of just getting stuff done. That is why it is so important that we have MHCLG on the taskforce alongside DEFRA, because it is about the question not just of financing but of planning. Everybody seems to want reservoirs, but lots of people do not seem to want them to be built—that part of it seems to be the difficulty.
The right hon. Gentleman is quite right. We have had to intervene more to look at where the blockages are, at the problems we come up against when we try to get something built, and at how we as the Government can remove some of them so that we can get on with it. We know the climate is changing—we know we are going to have wetter winters and drier summers—so this is becoming even more urgent.
Rebecca Long Bailey (Salford) (Lab)
The Minister knows that for decades shareholder returns have been prioritised over consumers, the environment and infrastructure investment, and when the companies ultimately fail, it is taxpayers who have to underwrite them. Given that all the empirical research shows that public ownership would lower financing costs and bills, improve accountability and pay for itself within seven years, why on earth are the Government still prepared to socialise the risks rather than bring water back into public ownership?
Emma Hardy
I thank my hon. Friend for the passion with which she speaks about this issue. I reiterate that my focus has always been on the quickest and most effective way I can deal with some of the problems in front of me. There are questions over how much nationalisation would cost—we have heard them before—and we know that the water companies have £82.7 billion of outstanding debt.
It is always difficult—again, this probably goes beyond my role and into that of the Treasury—to decide on priorities about what we spend money on, but that is not for one moment to give the impression that I am happy with the status quo or that I think the current situation is good, because I simply do not. It is about how we make the most effective change in the quickest way, which is why having set out in the White Paper a transparent process to look at not-for-profit mutuals and other different models is so important.
Adrian Ramsay (Waveney Valley) (Green)
The suppressed report from DEFRA civil servants on critical systems beyond 2030 concludes with high confidence that without “transformational change” Britain’s water and food systems face a realistic risk of “catastrophic failure”. The report highlights that significant parts of the UK already face water scarcity, while high levels of industry debt and woefully inadequate infrastructure investment have undermined system resilience. Can the Minister assure the House that the water Bill will require companies to build long-term climate resilience into reservoir supply networks and waste water systems, so that communities are protected from the climate and water security challenges expected in the coming years and decades?
Emma Hardy
The hon. Gentleman raises a really important point, and the short answer is yes. We need clear resilience standards and asset standards, because we do not have them, but, importantly, as he pointed out, those standards need to be fit for the future and not just for today. When we look at what the standards should be, we should think about what will happen to the climate in years to come in terms of overheating and flooding. The hon. Gentleman is quite right: work on that is going on, and he raised an important point.
Alex Sobel (Leeds Central and Headingley) (Lab/Co-op)
Minister, we know that our water company, Yorkshire Water, is a dirty business, flushing sewage into rivers such as the Wharfe and the Aire, with children and others getting ill from swimming in them. But is it not also a broken business, with debt more than four times its revenue, while still paying over £50 million to shareholders last year? What financial studies has the Minister done to look at Yorkshire Water’s viability? Is it not time that the people of Yorkshire have the same say over their water company as the people of Wales?
Emma Hardy
My hon. Friend is right that we share the same water company. Sir Jon Cunliffe’s commission addressed whether it would be appropriate for the Government to set a level of debt that companies cannot go beyond, because the gearing over the last decade or so has been completely unsustainable. It is making companies act in a way that I do not think is right. That is why the need to look at the debt levels for these companies was included in the White Paper. We need to look at what is a sensible and realistic level for them to hold, to ensure it does not undermine their sustainability or their ability to put customers and the environment first, which should be at the core of everything they do.
Katie Lam (Weald of Kent) (Con)
I know that the Minister is acutely aware of the terrible problems we have had with South East Water; we have discussed it recently. It cannot supply water in the winter because it is too cold. It cannot supply water in the summer because it is too hot. The chair and the chief executive have both stood down, but that is a necessary condition for the company to be transformed, not the transformation itself. Can the Minister give us any update she is aware of on how the recruitment process is going to appoint their successors and what role the regulator and the Department will play in that process?
Emma Hardy
The hon. Lady wrote to me about the specific difficulties her constituents have faced, and I have huge sympathy with them; that is not acceptable. The regulator will of course be taking a close interest because one issue that South East Water faces is that it is non-compliant with its licence because it was downgraded by Moody’s. Ofwat will be taking a very close interest in what happens with the company because it is not currently compliant. I, too, am very interested in what happens with this company. I have met the interim chair. She has been in post for only a few weeks and is trying to restore relations with Members of Parliament, so I am keen to know from them how that is going. Fundamentally, the hon. Lady is right and what she said was echoed in the Environment, Food and Rural Affairs Committee: we need not just a change in leadership, but a change in culture and a fundamental change in leadership for that company.
Clive Efford (Eltham and Chislehurst) (Lab)
Parents from my constituency who went to the south coast during the half-term week described how they would not let their children swim in the sea. These are not necessarily beaches that are deemed to be unsafe, but such is the loss of confidence in our water industry that they reacted in that way. There must come a time when we say that we cannot allow water companies to continue to perform in the way that they have consistently been performing, and there must be a way of separating off the debt from the responsibility for running the water companies so that we can take the responsibility of supplying water and leave those companies, who have done extremely well out of the industry, to pay off their own debts.
Emma Hardy
As summer comes, we all want to be enjoying our beaches, going for a swim, having a paddle and not having to think about checking an app to see whether they are polluted. My hon. Friend and his constituents are right to feel angry about the current situation. We have told companies that in delivering their storm overflow reduction plan, they must prioritise bathing waters and chalk streams to begin with so that we can make those as safe as possible. Our reforms to bathing waters will help clean them up more quickly, because we want everybody to go out and enjoy the great British seaside this summer.
Jess Brown-Fuller (Chichester) (LD)
I refer members to my registered interest as chair of the all-party parliamentary group for infant feeding and inequalities. With water scarcity prevalent across the south-east and poor management of water companies leading to outages across the south, will the Minister consult with her colleagues in the Department of Health and Social Care to find a route to put new mothers on to the priority services register automatically, because for formula-fed babies there is no option other than a clean water supply?
Emma Hardy
That is a hugely important issue. I have already begun to have some conversations, but those were about pregnant women, who obviously should be on the priority services register. There are concerns, as people can imagine, about data sharing and giving permission, but this is a really important point because pregnant women will fall in and out of being a priority, as will formula-fed babies. This is quite tricky because of the problems around sharing information, but it is on my agenda.
Emma Lewell (South Shields) (Lab)
For over a decade, I have worked with campaigners in South Shields to stop sewage dumping in our sea. We are still waiting for Northumbrian Water’s compliance plan that was promised to us last year. The industry is broken. Introducing regulations and penalties and blocking bonuses is clearly not working. Will the Minister explain why, despite acting on rail, energy and other industries, the Government are not acting on the strong expert evidence and calls from the public and campaigners to nationalise the water industry?
Emma Hardy
My hon. Friend and her constituents have had a terrible time dealing with sewage pollution. I know from the meetings that we have had together with her constituents that it is not good enough that the promised plan was not delivered, and I will urgently follow up to find out what has happened with it. As I have mentioned, in the White Paper we have a transparent process to look at various not-for-profit models.
Joe Robertson (Isle of Wight East) (Con)
Southern Water is preparing to dump sewage on a beach in Bembridge, on the Isle of Wight, in a new location. The Environment Agency says that that is okay because there is an old combined sewer overflow pipe there, notwithstanding the fact that it has not been used in decades. Does the Minister agree that that is unacceptable? If she does, what assistance can she and her Government provide to stop this from happening?
Emma Hardy
The hon. Gentleman raises an important point. I would be happy to look into it and get back to him. If he wants to have a meeting with me to discuss it further, we can make that arrangement.
Navendu Mishra (Stockport) (Lab)
I thank my good friend, my hon. Friend the Member for Norwich South (Clive Lewis), for all his work on this issue to protect the environment and customers. My local supplier is United Utilities and I receive vast amounts of correspondence about its poor performance. To provide a couple of stats, 50.6 litres of water are lost per day per person in the United Utilities network through water leaks, which is the second highest after Thames Water, and in the past five years the average annual water bill for United Utilities customers has gone up approximately 51.6%, while private shareholders in the water industry tend to be doing quite well for themselves. May I urge the Minister to support public ownership of the water industry?
Emma Hardy
My hon. Friend cares about this issue and has raised it with me before. He is right to be angry about the issue of leakage, because water that people are paying for is ending up leaking and in the wrong places. We are tracking that leakage target through the water delivery taskforce. When we look at how we ensure that we have the water that we need for houses, growth, the environment and everything else, tackling leakage is one of the core things on which we can take action, and it is something I am committed to doing.
Liz Saville Roberts (Dwyfor Meirionnydd) (PC)
Diolch yn fawr iawn, Dirprwy Lefarydd. Local people are appalled that there were nearly 95,000 hours of sewage pollution in Dwyfor Meirionnydd last year, to the point where there are dedicated local groups in the constituency. I must mention Forum Llyn Padarn who stepped in to monitor water quality in the magnificent glacial lake in Llanberis, home of the rare Torgoch char. However, we cannot rely on citizen scientists to fix the system in its entirety. What update can the Minister give me on the UK Government’s White Paper plans to devolve further water powers to Wales, so that we have the means to establish a separate independent economic regulator, and further prioritise sustainable water management over commercial interests?
Emma Hardy
The right hon. Lady raises an important point, and that lake sounds very beautiful. Conversations are ongoing with the new devolved Government. She knows that the UK Government support devolution wherever we can. The new Welsh Government have only recently been elected, but I assure her that conversations are happening right now about how we will set things up so that Wales will have a separate regulator from England.
Helen Hayes (Dulwich and West Norwood) (Lab)
My constituents have been profoundly failed by Thames Water for many years, with frequent leaks and bursts, inadequate investment in our infrastructure, clogged up roads and, to add insult to injury, skyrocketing bills. Thames Water is a failing organisation. Will the Minister confirm that the Government will not accept a proposal to exempt Thames Water from fines for four years? It should be held to the same standards of accountability as the rest of the industry and if it fails, the Government should step in to place it in special administration, with a view to bringing it back under public control.
Emma Hardy
Again, my hon. Friend is a formidable campaigner on this issue; she has raised it with me on many occasions both in public and in private, and she is absolutely right to do so. Yes, the rules apply to everybody. The previous Secretary of State stood at the Dispatch Box and made that commitment, and I will make it again. Rules apply to everybody, and that has never changed and will never change under this Government. We are prepared and ready for every eventuality if that is needed.
Ben Maguire (North Cornwall) (LD)
South West Water has pleaded guilty to illegal sewage dumping across my constituency, including at Bodmin and Harlyn. It will likely get yet another fine and a slap on the wrist—a cost of doing business. The Water Minister kindly met me recently, but she has confirmed in writing that vital sewerage upgrades will not take place until 2030. If the Government will not push South West Water to speed up its investment plan, will the Minister support my efforts to hold it to account through a group action legal claim?
Emma Hardy
I understand why the hon. Gentleman feels frustrated about this issue. Each company will set out through the price review exactly what it will deliver and when, and make priorities. As I have already mentioned in the House, we are prioritising bathing waters, chalk streams and various other areas at the moment, but he is well within his rights as a Member of Parliament to campaign for his area to be moved up and be given greater priority.
Sarah Russell (Congleton) (Lab)
Since 2003, my constituent has suffered multiple incidents every year of raw sewage flooding into his garden. United Utilities is disputing with him how the guaranteed standards scheme works, and he is not receiving adequate compensation. His golden wedding anniversary was completely ruined when he had family over and the garden was literally full of excrement. This situation could not be any worse—it is an absolute disgrace. Although we have strengthened the regulations, our current system is not sufficiently economically damaging to UU to force it to take actions that would solve the problem for my constituent. Will the Minister please meet with me and my constituent to talk to him about this issue?
Emma Hardy
I would, of course, be happy to meet with my hon. Friend.
David Reed (Exmouth and Exeter East) (Con)
The Minister will know from our conversations that sewage pollution is a regular problem in Exmouth and Exeter East. However, the Lib Dems on East Devon district council propose to build tens of thousands of new homes, and I do not have faith that South West Water will keep pace with all the new development. We have been bitten before: a new town was built in Cranbrook, and the corresponding sewage treatment network was never built. Will she work with me and the Housing Minister to ensure that we apply a magnifying glass to any plans and push back strongly if South West Water cannot keep pace with delivery?
Emma Hardy
The hon. Gentleman is quite right. Where we are building homes, we need to ensure that they have not only an adequate water supply, but an adequate waste water supply. We are looking at that in the water delivery taskforce, and I am happy to look at the exact example that he has given.
Richard Burgon (Leeds East) (Lab)
Greedy privatised water companies have caused huge harm by treating our rivers and seas like an open sewer. They have been ripping off the public while doing that and, at the same time, they have handed nearly £90 billion over to shareholders since privatisation. Does the Minister agree that, as is being done with the railways, the water companies need to be taken into public ownership so that they can serve the public good and be run for the public good, not for private profit?
Emma Hardy
My hon. Friend is right to passionately defend customers and to be angry about the fact that money has been diverted and not used in the most effective way, which it should be. As I have mentioned, we are looking to set up a transparent process to look at various ownership models for water, such as a not-for-profit model.
Caroline Voaden (South Devon) (LD)
Last week, South West Water was fined nearly £2 million after pleading guilty to supplying water unfit for human consumption in Brixham in my constituency in 2024. I do not believe that that fine does justice to the impact of the event; people became ill—some were hospitalised—and the economic impact was massive. Repeated fines, some of which are never paid, are not delivering the results that customers want to see. The Minister—a Minister in a Labour Government—says that the customer is the most important priority. Does she agree that it is time to change the ownership model of the water industry so that the customer is prioritised over profit made for overseas shareholders?
Emma Hardy
The hon. Lady is right to point out the record fine that was handed out for not having drinking water at an adequate standard, and I pay tribute to the Drinking Water Inspectorate and the work it has done—it does an incredible job of making sure our drinking water quality is among the best in the world. On ownership, the hon. Lady will have heard me say that we are looking at setting out a transparent process in the White Paper for water companies that wish to transition to a different model.
Lee Barron (Corby and East Northamptonshire) (Lab)
I commend the Minister for coming to the House today to outline the various measures that have been taken, but what this says to me is that the model is fundamentally broken. We need a new model, one that puts people before profits, because people should no longer accept that the public always pay the bills and the shareholder always takes the profit. The issue with water is that we have privatised the profit and nationalised the debt. Bearing that in mind, does the Minister agree that the change people want is a Government who take the right and radical approach and bring our water back into public ownership so that it serves the people, and to stop shareholders being paid a dividend for failure on what is a natural monopoly and a basic human right?
Emma Hardy
My hon. Friend is right to be angry at the service that many customers have faced for years, and at the broken model we have had for a very long time. We need a fundamental reset—we have already made a huge number of changes since coming into government, and we as the Labour party should be proud of all those changes. As I have mentioned, we are looking at a transparent process for whether requests to move to a new model should go ahead, but that is for models such as not-for-profit.
Greg Smith (Mid Buckinghamshire) (Con)
I have many criticisms of the operating practices of Thames Water, but further to the point made by my hon. Friend the Member for Exmouth and Exeter East (David Reed), I am very concerned about the total dysfunctionality in how the planning system interacts with water companies. This is a problem now, even before Buckinghamshire is wrongly asked by this Government to build 95,000 homes. We have seen a lot of development in recent years—in the village of Ickford, for example, the wagon to pump sewage out and take it away by road has already become the norm. Does the Minister agree that if the Government are determined to build all these homes, water companies should get statutory consultee status for all planning applications? Otherwise, they are going to be chasing their tails rather than fixing the problems we already have.
Emma Hardy
This Government are determined to build the homes that people need. I am sure that every Member has met enough people who are living in overcrowded homes and are desperate to move somewhere else—I know I have. In fact, just on Friday, I was talking to a constituent who lived with his wife, their six-year-old daughter and their two-year-old son in a one-bedroom flat because no other alternatives were available. When we talk about objections to building homes, we never ask people living in overcrowded accommodation how they feel about the number of homes we want to build.
However, on the fundamental point of the planning system and the water companies, the hon. Member is right, and we are looking at that through the water delivery taskforce. As I have mentioned, it is important to make sure we have the water and waste water capacity to build the homes this country needs.
Cat Eccles (Stourbridge) (Lab)
In 2025, there were over 300,000 sewage spills into our waterways up and down the country. In March this year, a section of the Stourbridge canal had to be closed due to raw sewage spilling into the water from a broken Severn Trent pipe, killing hundreds of fish. Does the Minister accept that the current model of privatised water companies is failing to protect our natural environment, and as sewage spillages continue, how will her Department measure success in that area? If there is no improvement, when do we say enough is enough?
Emma Hardy
My hon. Friend raises an important issue, and I remember hearing about that incident. That is why under this Government, the Environment Agency has carried out over 10,000 inspections of water companies; under the previous Government, the figure was only 4,000, so we have increased the number of inspections. We are also introducing MOT-style inspections so that when the Environment Agency goes into a water company, it can check all the infrastructure, see where the problems are and get the company to tackle them before another awful incident such as the one my hon. Friend has described occurs, where sewage ends up in the wrong place, causing damage to our environment.
James MacCleary (Lewes) (LD)
Villagers in Rodmell in my constituency have been without water or had low water pressure for weeks—including during the recent heatwave—with little or no communication from South East Water. Just up the road in Ringmer, residents are really concerned about large-scale house building plans, with little account being taken of the need for additional water infrastructure despite pre-existing problems. Can the Minister tell me what action she is taking to press water companies to communicate properly with customers during outages. May I also press her again on water companies being statutory consultees in the planning system?
Emma Hardy
The hon. Gentleman is right to say that South East Water’s communication with customers was frankly not good enough, and nor was its communication with Members of Parliament. One thing we are trying to do through DEFRA is to support the work with the local resilience forum to look at how we can improve that communication, so that everybody knows what is happening and when. That way, we can work as a coherent unit, rather than having miscommunication between the different parties involved.
To repeat an answer I have already given, through the water delivery taskforce, we are looking at planning, water supply and waste water supply together when ensuring we build the homes our country needs. I say “our country”, but it is about building the homes that our people—families, adults and children—need. When we talk about house building, we forget about the number of people living in overcrowded accommodation. I am yet to have a conversation with somebody living in overcrowded accommodation who says no when I ask, “Would you like to live in a home rather than the overcrowded one-bedroom flat you are currently in?” Let us remain focused on the families who desperately need the homes we are building. As a responsible Government, we will build them in a way that does not put extra pressure on our water system.
Emily Darlington (Milton Keynes Central) (Lab)
I will raise with the Minister something that I have already raised with her in a letter about the impact of Anglian Water, another failing water company. There was no water on the hottest day of the year for families in Woburn Sands and the Brickhills. That is a disgrace. Around the same time, there was a lack of water pressure, and the fire and rescue service in Milton Keynes had to bring in water to fight a fire. Does the Minister agree that each and every one of these companies has a story of failure, and it is time we held them to account? I urge her to resist calls to allow failing water companies to determine how many homes can be built in this country. Instead, we should make them do the job that they are there for, which is to give water to each and every one of us.
Emma Hardy
My hon. Friend is absolutely right, and I could not have put it better myself. She is right to be cross about problems with water pressure. Instead, we seem to be deflecting the problem by saying, “We should not build the homes we need”. We absolutely should build the homes we need, and we should ensure that the water companies deliver the water for them.
Richard Foord (Honiton and Sidmouth) (LD)
In 2023, South West Water was fined little more than £2 million for seven pollution incidents dating back seven years at South West Water facilities, including at Kilmington. Now we learn that it has been fined less than £2 million for supplying drinking water in south Devon that left 140 people sick and four people hospitalised. This company had revenue of nearly three quarters of a billion pounds last year. How is the Minister upholding the polluter pays principle when the polluter only has to set aside loose change?
Emma Hardy
That was a record fine for not delivering safe and clean drinking water, but the hon. Gentleman is right that what happened there is a serious issue. Issuing fines is a matter for the independent regulators. On making the polluter pay, through our changes to the Water (Special Measures) Act 2025 we can recoup the cost of investigation from the company, and we can carry out more investigations, so under this Government the polluter really does pay.
Josh Dean (Hertford and Stortford) (Lab)
The River Stort is one of our rare and precious local chalk streams, and my residents were rightly furious when they discovered that Thames Water has been pumping sewage into it for hundreds of hours. When I asked Thames Water what it intended to do to remedy the situation, it told me that it had an improvement plan in place and it would not be ready until 2028 at the earliest. That is not good enough. My residents will not stand for that, and neither will I. Can the Minister say a little more about what we can do to hold these water companies to account, to speed up the progress that they are making, and to ensure that we protect our rare chalk streams specifically?
Emma Hardy
My hon. Friend is right to point out how beautiful and rare our chalk streams are. In fact, they are often known as our rainforests, because England is one of the only places in the world where we find chalk streams. He is right to be angry about Thames Water polluting them. Under the rules that we have set under this Government, we have prioritised chalk streams and bathing waters as an issue of public safety and protecting the environment. If Thames Water is not doing that, I am keen for my hon. Friend to write to me with the specifics, and I will take it up with the company.
Clive Jones (Wokingham) (LD)
In my constituency, sewage was spilt from the Arborfield treatment works 28 times last year, and in the last few days sewage has poured into the Emm brook. Given the numerous repeated sewage spillages in Wokingham and across the country, will the Minister back the Liberal Democrat proposals for a mutually owned public benefit model for water companies, focusing investment on the environment, customers and replacing and repairing infrastructure rather than on lining the pockets of water company shareholders and senior managers?
Emma Hardy
The Government are, of course, determined to tackle the sewage scandal head-on and clean up our rivers, lakes and seas for good. We want to address the root cause of pollution. We are shifting the focus to a dual approach, driving water company action and pre-pipe solutions, tackling sewer misuse and pushing for better rainwater management. These changes are more sustainable, enabling growth, delivering more benefits, reducing flood risk and protecting biodiversity. We will hold companies to account for the promises made in respect of their storm overflows discharge reduction funds.
Cuba: Humanitarian Situation
(1 day, 5 hours ago)
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Jeremy Corbyn (Islington North) (Ind)
(Urgent Question): To ask the Secretary of State for Foreign, Commonwealth and Development Affairs if she will make a statement on the deteriorating humanitarian situation in Cuba, following the US naval and financial blockade of the island.
The Parliamentary Under-Secretary of State for Foreign, Commonwealth and Development Affairs (Chris Elmore)
I thank the right hon. Gentleman for his urgent question.
The United Kingdom is concerned about the deteriorating humanitarian situation in Cuba, particularly shortages of food, fuel and essential medicines, which are having a real impact on ordinary citizens. The United States’ long-standing embargo continues to place significant constraints on Cuba’s economy and its access to international finance. The United Kingdom has consistently opposed the embargo, for instance at the United Nations, for nearly 30 years. At the same time, domestic economic challenges within Cuba also play a role, and sustainable improvement will require economic reform and greater resilience.
We welcome confirmation from the Governments of both Cuba and the United States that talks are under way to permit an urgent improvement in the current circumstances, and we urge all parties to move swiftly to an agreement that can alleviate the suffering of the Cuban people. We also welcome and encourage confidence-building measures that can help to reach that goal, including the release of political prisoners and easing of restrictive measures. Our priority is the safety and welfare of British nationals in Cuba, alongside the resilience of the Cayman Islands and Turks and Caicos Islands, our two overseas territories in the region. We remain deeply concerned for the Cuban people, and will continue to support constructive engagement, monitor humanitarian needs, and work with international partners to encourage solutions that ease hardship and promote long-term stability.
Jeremy Corbyn
I thank the Minister for his answer, and I thank him for confirmation of Britain’s consistent opposition to the blockade of Cuba. My entry in the Register of Members’ Financial Interests will indicate my own interest in respect of my recent visit to Cuba with the hon. Member for Leeds East (Richard Burgon). During that visit we were able to deliver some medical aid, for instance during a visit to a cancer hospital. Forever seared in my memory is the sadness in the eyes of the hospital director as he tried to deal with the catastrophic loss of power and loss of medicines while dealing with people whose conditions meant that they were potentially terminally ill.
Owing to the fuel blockade, any fuel bought on the open market in the streets of Havana would cost at least £10 per litre, which means that for most people it is impossible to obtain. As a result, traffic simply does not flow. Bus services do not run, very few taxis run, and refuse collection—and so much else—is impossible. Moreover, because a fair amount of the electricity is generated by means of oil, there are power cut-offs lasting up to 20 hours a day. The health risks are enormous, the education risks are enormous, and Cuba is really up against it.
We had a fascinating meeting with the Government and others about converting the economy to a much greater extent through sustainable energy sources, and about the way in which they wish to take things forward. However, the US sanctions and blockade, the order from Donald Trump in January this year and the long-term effects of the Helms-Burton Act mean that the economy of the island is strangled. The loss of financial services, and of the use of international credit card facilities, means that the tourism industry has halted. There is no tourism industry at the moment, and there are no visitors to Cuba. At best, there are one or two flights a day at an airport that used to be quite busy.
None of this is necessary, and we should recognise and thank the Governments of Mexico, China, Canada, Japan and EU member states for the support they have given. Britain has recognised Cuba for 124 years. Can we please have some aid for Cuba, including oil?
Chris Elmore
I thank the right hon. Gentleman for his question. As I said in my opening remarks, this is the 30th year in which the UK Government have objected to the embargo, and we will continue to do so. We work through the United Nations on humanitarian aid relief to ensure that direct support reaches the Cuban people.
Alan Gemmell (Central Ayrshire) (Lab)
I thank the Minister for his response. The situation in Cuba is very worrying. Can he set out what the UK Government are doing to ensure that aid reaches those who need it?
Chris Elmore
My hon. Friend is right to raise the wider humanitarian concerns. I can reassure him that, through the World Food Programme and UNICEF, the UK Government continue to provide aid. We are a major contributor to the UN’s central emergency response fund, which ensures that the Cuban people are supported through disaster response efforts, as well as efforts in relation to the latest challenges.
Wendy Morton (Aldridge-Brownhills) (Con)
I am grateful to the right hon. Member for Islington North (Jeremy Corbyn) for securing the urgent question, and to the Minister for his response. The imposition of tariffs is a bilateral matter for the US and Cuba. We are appalled by Cuba’s record of abusing its civilians’ political, civil and human rights. The Cuban regime’s record is shameful, and we should be wary of narratives that seek to explain Cuba’s current difficulties solely through external factors. The reality is that the Cuban people have endured decades of economic stagnation, political repression and the denial of basic freedoms under a one-party communist system, and any assessment of the present situation must acknowledge the wider context.
I turn to the Minister’s response. Can he tell the House what recent discussions Ministers have had with the US Administration regarding developments in Cuba and the actions of the United States? Can he set out what engagement the Government have had with the Cuban authorities? In those discussions, have Ministers raised concerns about human rights, political prisoners and democratic freedoms, alongside the humanitarian issues?
Finally, are the Government considering a humanitarian response and, if so, how will they ensure that that assistance reaches the Cuban people directly and is not diverted for the benefit of a regime with such a poor record on human rights and civil liberties? The House would really benefit from a clearer statement of the Government’s overall policy towards Cuba at what is clearly a significant moment for the country and its people.
Chris Elmore
I thank the right hon. Lady for the constructive way in which she always engages in these conversations on the Floor of the House. I reassure her that I would echo, and expand on, her concerns about the Cuban Administration’s impact on human rights. To answer her question on engagement directly, I have met the Cuban ambassador since the beginning of this year, not only to discuss the challenges that the Cuban people are facing but to directly challenge the human rights conditions that they are facing. I can confirm that there is ongoing regular engagement between the British embassy in Washington and US State Department officials. More specifically, the Foreign Secretary, the Deputy Prime Minister and the former permanent under-secretary of state have had regular engagement with both Secretary Rubio and Deputy Secretary Landau to discuss the negotiations between the Cuban and US Administrations.
Paula Barker (Liverpool Wavertree) (Lab)
The UK-Cuba political dialogue and co-operation agreement—PDCA—was signed in Havana in 2023 and ratified by the Cuban National Assembly in 2024. In the UK, it remains under cross-Whitehall consultation, with no current timetable for parliamentary scrutiny. Will the Minister consider agreeing to a provisional implementation of the PDCA, as the EU did with its own agreement in 2017, to signal constructive engagement and deepen bilateral co-operation?
Chris Elmore
I know how much my hon. Friend cares about this issue, and I was pleased to meet her and other colleagues recently to discuss the challenges that the Cuban people are facing. On better bilateral relations, we are looking to extend our work on climate and wider environmental protections, and also on science and technology, so we are looking more towards our bilateral relationship. She is right to say that the political dialogue and co-operation agreement remains under review.
Monica Harding (Esher and Walton) (LD)
Trump’s reckless blockade is exacerbating the humanitarian crisis facing Cubans. It is the latest iteration of his “might is right” approach to global diplomacy, with devastating impacts. Four months in, Cubans are facing a backlog of 96,000 pending surgeries. There are 1 million people without reliable drinking water, empty petrol stations and a deadly summer heatwave. UN experts are formally condemning the blockade as “energy starvation”— a coercive tool that is being used against civilians.
With fresh sanctions imposed on Thursday, the situation will only get worse. Given that Raúl Castro is now indicted, the parallels with Venezuela, where Trump used an indictment as a precursor to forcible regime change, are impossible to ignore.
What conversations have the Government had with the US Administration about the blockade? Will the Minister provide an assessment of what will happen next, including of the possibility of military incursions? As Spain and Canada organise emergency aid shipments, will the Government review our aid contribution?
Chris Elmore
On engagement with the US Administration, as I set out in reply to the shadow Minister, the right hon. Member for Aldridge-Brownhills (Wendy Morton), there has been a continuous dialogue since the beginning of the year with me, the ambassador or the Foreign Secretary, including between the Deputy Prime Minister and Secretary Rubio as recently as April, so those conversations are ongoing. On aid, I can confirm that officials are working up options for how else the UK might support additional funding for the Cuban people, including through the United Nations.
Richard Burgon (Leeds East) (Lab)
I recently went on a three-day humanitarian visit to Cuba where, among other things, we delivered aid to a cancer hospital. When we were in Cuba, not a single drop of fuel had got into the country for three months because of Trump’s fuel restrictions, and I saw with my own eyes that Trump’s fuel blockade was having a devastating humanitarian effect on millions of ordinary Cubans.
I am very disturbed and concerned to see the threats emerging from the Trump Administration, but I welcome the fact that, as is our country’s long-standing position, the UK Government continue to vote against the blockade at the United Nations. Disputes between nations must be resolved through dialogue and with respect for international law, so will the Minister confirm that he will use his efforts and those of his office to ensure that diplomacy and dialogue are seen as the best way forward?
Mark Pritchard (The Wrekin) (Con)
I congratulate the right hon. Member for Islington North (Jeremy Corbyn) on bringing forward this urgent question. I certainly agree with him that the humanitarian situation in Cuba is bad and getting a lot worse, but we may disagree about the best way to bring relief to the Cuban people. In my view—and this is not a western construct, but I believe an international construct— freedom, democracy and the international rule of law may be a better way of opening up Cuba to humanitarian relief and political relief. It is of course a one-party, communist state, and a failed state.
Will the Minister again emphasise the importance of the Cuban Government releasing political prisoners, giving their people more freedom, and allowing people to grow their own food and grow their own businesses? On the humanitarian point, does he agree with the American Administration that it is best for humanitarian aid to go through the Catholic church, charities or faith-based organisations, not through the regime?
Chris Elmore
On the diplomatic point, which was mentioned by my hon. Friend the Member for Leeds East (Richard Burgon), I agree. We have had a bilateral relationship with the Cuban Government for more than 100 years, which means we have been able to have more of a frank dialogue. It is through dialogue in the multilateral and bilateral systems that we will bring more prosperity to the people of Cuba.
On the human rights issue, as I have mentioned in response to a number of Members across the House, I agree. We continue to have a dialogue about the release of political prisoners. More broadly, decisions on the future of Cuba should be for the Cuban people.
Torcuil Crichton (Na h-Eileanan an Iar) (Lab)
I thank the Minister for his statement and the right hon. Member for Islington North (Jeremy Corbyn) for bringing this urgent question to the House. Cuba is on its last breath after a brutal four-month siege that is as commercial as it is ideological in nature. We have seen Spanish hotel operators pull out of the country. We have seen Canadian companies such as Blue Diamond and Sherritt, the Canadian nickel company, thinking again because of the threat of secondary sanctions. It seems that the US President is attempting to sweep aside Canadian and Spanish interests to bring in US crony companies and reintroduce the spirit of colonialism that led to Castro’s revolution in the first place. What discussions have UK Ministers had with their Spanish and Canadian counterparts to make it clear to the US Government that this is not acceptable?
Chris Elmore
We have an ongoing dialogue. I have met Canadian and Spanish counterparts in recent months, and Cuba has been discussed. As my hon. Friend will know, US decisions about what is happening in Cuba are for that Administration, but we continue to call for dialogue. As I mentioned in my opening statement, we welcome the fact that both the Cuban and US Governments have confirmed that those negotiations are ongoing. We continue to work in the multilateral space to bring about a resolution that works best for the Cuban people.
Alicia Kearns (Rutland and Stamford) (Con)
I would hope that no one in this House had any sympathy for the Cuban regime. It is highly unlikely that President Trump will pursue military action in Cuba; it is far more likely that the US Government intend to use Venezuelan oil as leverage over Cuba to force changes in its behaviour. What is the Minister’s assessment of the legal basis on which Venezuela’s sovereign oil can be transferred and used as a bargaining chip by the US, and how would the UK sanctions regime respond to that?
Chris Elmore
The hon. Member will know, as a former Chair of the Foreign Affairs Committee, that we do not discuss sanctions on the Floor of the House, but I am more than happy to meet her to go through some of the wider challenges, particularly regarding the conditions in Venezuela and their impact on the wider region.
John McDonnell (Hayes and Harlington) (Lab)
I will just say that it is not for the US to determine the future of the Cuban people—that is for the Cuban people themselves—or to use such methods to try to influence the regime. The UN Secretary-General has made clear his view that Cuba is on the brink, and children are already dying as a result of what is happening in the hospitals. Some of the sanctions have affected the ability of the Cuban Administration and Cuban companies to access banking and, more recently, payment facilities. What discussions have the Government had about assisting the Cuban Administration to overcome these US Government activities, which are endangering the whole Cuban economy?
Chris Elmore
I agree with my right hon. Friend, and I hope he heard me say that decisions about the future of Cuba are for the Cuban people, not for any foreign country, including the United Kingdom. On additional assistance, as I have said in previous answers, conversations are ongoing about what more we can do in the multilateral system.
I can confirm to the House that we are doing a piece of work on the particular challenge of fuel shortages, which several Members have mentioned. The Foreign, Commonwealth and Development Office is now providing a fuel management specialist to the World Food Programme, which is unblocking some of the wider fuel challenges, and that will be critical for the effective delivery of aid. We are trying to work through this in a very practical sense, as I am sure my right hon. Friend would agree. On the wider point about banking, as I have said to him, we are working with multilateral partners to see what additional support we can provide and where we can work in a joined-up way to bring about a better future for the Cuban people.
Seamus Logan (Aberdeenshire North and Moray East) (SNP)
I thank the Speaker’s Office for granting this long-overdue urgent question, and I congratulate the right hon. Member for Islington North (Jeremy Corbyn) on securing it.
This is indeed an urgent matter for the Cuban people as they continue to endure a deepening man-made humanitarian crisis, with shortages of food, electricity, fuel and even vital lifesaving medical supplies, as has been said. It has been caused by the Trump Administration, who have unjustifiably described Cuba as a threat to US national security. Can the Minister confirm that the Foreign Office will inform President Trump that the UK will vigorously oppose any and all attempts by the United States to use military force against Cuba, and can he reconfirm that he is seeking to persuade the US Administration to ease the measures currently contributing to this impending disaster for the Cuban people?
Chris Elmore
On diplomatic efforts, I have said repeatedly—I am happy to reiterate it—that that work is ongoing. I have listed a number of meetings that have happened at the most senior level. In terms of the hon. Gentleman’s points on force, our dialogue is about peaceful resolutions through political dialogue, not through increasing any conditions. On the wider point around what is happening in Cuba, as I said in my opening response to the right hon. Member for Islington North, we have opposed the embargo for the past 30 years. I cannot predict the future, but that has been the position of Administrations from 1996 until today.
Rebecca Long Bailey (Salford) (Lab)
US secondary sanctions on Cuba arguably represent a clear breach of international law. What representations have the UK Government made to the US about that, in the same way they did with regard to Greenland?
Chris Elmore
We continue to have the dialogue I have mentioned in previous answers, and we continue to be of the very strong view that diplomatic courses of action are the best way forward. We also continue to respect the UN charter and the wider multilateral system, including the international rule of law. We would expect, as a member of the UN Security Council and the General Assembly, all countries to follow that position.
Sir Julian Lewis (New Forest East) (Con)
I entirely agree with the Minister when he says that the future of Cuba should be decided by the Cuban people. What assessment have the Government made of the likelihood of the Cuban Government ever allowing the Cuban people to take those decisions?
Chris Elmore
The right hon. Gentleman makes a fair point. Work goes on constantly to try to work through how there can be a move towards the decisions of Cuba being for the Cuban people. I would point out that our bilateral relationship has been in existence for more than 100 years. I say that not just for the sake of it; we have been able to have those frank and difficult conversations because we have kept the relationship open. We will continue to have those difficult conversations, whether with the ambassador or with Ministers in the Cuban system, because we want to do the very best we can for the Cuban people.
Brian Leishman (Alloa and Grangemouth) (Lab)
I thank the right hon. Member for Islington North for bringing forward this urgent question. I do not think that anyone can possibly dispute that energy shortages will prove fatal, as will the disease that will inevitably follow, and hyperinflation for essential items will price millions of Cubans out of buying goods. Do the UK Government recognise that the American blockades are a lethal method of economic terrorism? Why on earth do the UK Government not call out internationally our counterparts in the American Administration for that?
Chris Elmore
I do not know if my hon. Friend missed my previous answers, but we have very publicly spent the past 30 years voting against the very thing he is complaining about. We have not supported the embargo in the international space where these decisions are taken and that has been the position for successive Administrations.
Dr Andrew Murrison (South West Wiltshire) (Con)
In trying to understand what America has been doing in its own backyard, what assessment has the Minister made of Cuba as one of the largest foreign contributors to Russia’s illegal war in Ukraine? What are the Government doing to better understand the position of Cuba as a potential hub for hybrid warfare in the area, inspired by Russia and as Russia’s entry point for its malign activities in the wider Hispanic region?
Chris Elmore
The right hon. Gentleman is right to raise those issues. The work in this space continues. We work with the US Administration, as our closest ally, on defence and national security. We will continue to challenge in this space and work with Five Eyes and other security partners to ensure that that work does not move away from the fact that there are still those economic and wider social challenges for the Cuban people. National security remains an absolute priority for us, as it should for all Governments.
Steve Witherden (Montgomeryshire and Glyndŵr) (Lab)
As chair of the all-party parliamentary group on Cuba, I refer the House to the APPG register. In September in Machynlleth, the Cuban ambassador and a Cuban doctor working in Birmingham addressed my constituents in Montgomeryshire on the medical situation in Cuba. Since September, the situation has become worse, with nurses manually hand pumping ventilators so sick babies can breathe, and plastic carrier bags being used instead of colostomy bags. We have the aid needed here. Will we defy Trump’s monstrous blockade and get it into Cuba?
Chris Elmore
I thank my hon. Friend for his question and for the work he does as the chair of the APPG. I have been pleased to engage with him since he took on that role. Just to reassure him, as I did in our meeting, we are using the World Food Programme, UNICEF and the UN central emergency response fund to ensure that the funding is given to the correct agencies to support the Cuban people. That is the point: we are using agencies that are trusted in the region and then providing additional support through the WFP. We have fuel management specialists, so that aid can actually be delivered to the Cuban people. He is right to be deeply concerned, as we all should be, about the humanitarian conditions that the Cubans are living in. It is our job, as the UK Government, to find ways to ensure the aid goes directly in. That is what we are doing.
Richard Foord (Honiton and Sidmouth) (LD)
US sanctions on Cuba have been stepped up since Marco Rubio became US Secretary of State. Will the Minister talk about what representations the UK Government have made in Washington about the so-called Donroe doctrine as it relates to Cuba?
Chris Elmore
As I have said in previous answers, engagement remains at the highest levels, including at the British embassy in Washington with the US State Department, Secretary Rubio and deputy Secretary Landau, and between, again, Secretary Rubio and the Foreign Secretary, the former permanent under-secretary at the FCDO and the Deputy Prime Minister. That work goes on constantly in terms of engagement in relation to Cuba and many, many other issues relating to US-UK bilateral relationships.
Steel Industry (Nationalisation) Bill
(1 day, 5 hours ago)
Commons ChamberRead Full debate Read Hansard Text Read Debate Ministerial Extracts
20:11 - The Committee divided: - Ayes: 81 / Noes: 266 - Question accordingly negatived.
00:00 - The Committee divided: - Ayes: 65 / Noes: 257 - Question accordingly negatived.
20:40 - divided: - Ayes: 145 / Noes: 251 - Question accordingly negatived.
Dame Harriett Baldwin (West Worcestershire) (Con)
I beg to move amendment 21, page 1, line 6, leave out “of or including” and insert “predominantly of”.
This amendment would narrow the definition of a steel undertaking so that it had to be a business consisting predominantly of the manufacture or processing of steel, or iron for the purposes or in connection with the manufacture of steel.
The Second Deputy Chairman of Ways and Means (Caroline Nokes)
With this it will be convenient to discuss the following:
Clause stand part.
Amendment 14, in clause 2, page 1, line 14, leave out
“includes (but is not limited to)”
and insert “means”.
This amendment would limit the public interest test to the areas set out in subsections (a) to (c).
Amendment 23, page 1, line 20, at end insert—
“(d) preventing the closure of, or the loss of jobs at, a steel undertaking in Wales.”
This amendment includes the public interest in preventing the loss of jobs in Wales and the prevention of the closure of a steel undertaking in Wales in the meaning of public interest for the purposes of the Act.
Amendment 1, page 2, line 20, at end insert—
“(2A) The Secretary of State may not exercise a principal transfer power unless they have laid a statement before both Houses of Parliament explaining their reasons for concluding that it is necessary to exercise the power in the public interest.”
This amendment would require the Secretary of State to lay a statement before Parliament explaining their reasons for concluding that it is necessary to exercise a principal transfer power in the national interest, before exercising that power.
Amendment 15, page 2, line 20, at end insert—
“(2A) The Secretary of State may not exercise a principal transfer power unless he has commissioned an independent assessment of whether the exercise of the power is in the public interest, and that assessment has demonstrated that it is in the public interest.
(2B) The Secretary of State may appoint such independent person as he thinks fit to carry out an independent assessment under subsection (2A) above, and may pay remuneration and allowances to that person.”
This amendment would require an independent assessment of whether the public interest test had been met before the Secretary of State could exercise the principal transfer powers.
Amendment 16, page 2, line 20, at end insert—
“(2A) The exercise of a principal transfer power may only be considered to be in the public interest under subsection (1) if the Secretary of State has is satisfied that the exercise of the power would provide value for money for the taxpayer.”
This amendment would require the NAO to have concluded that the exercise of the principal transfer power was good value for money before the Secretary of State could consider it to be in the public interest.
Amendment 17, page 2, line 20, at end insert—
“(2A) The Secretary of State may not exercise a principal transfer power under subsection (1) unless they have laid a report before Parliament containing full details of the criteria used to assess whether the exercise of power would be in the public interest.”
This amendment would require the Secretary of State to publish full details of the criteria used to assess the public interest test before exercising the principal transfer power.
Clause 2 stand part.
Amendment 12, in clause 3, page 2, line 10, leave out subsections (3) to (5).
This amendment would prevent the Secretary of State extending the sunset of the principal transfer powers.
Clause 3 stand part.
Amendment 2, in clause 4, page 2, line 30, leave out “negative” and insert “affirmative”.
This amendment changes the procedure for share transfer regulations from the negative procedure to the affirmative procedure.
Clauses 4 to 14 stand part.
Amendment 3, in clause 15, page 8, line 21, leave out “negative” and insert “affirmative”.
This amendment changes the procedure for property transfer regulations from the negative procedure to the affirmative procedure.
Clauses 15 to 38 stand part.
Amendment 18, in clause 39, page 25, line 32, leave out “negative” and insert “affirmative”.
This amendment would require regulations relating to continuity obligations to be subject to the affirmative procedure.
Clauses 39 to 44 stand part.
Amendment 19, in clause 45, page 28, line 37, leave out “negative” and insert “affirmative”.
This amendment would require regulations related to enforcement to be subject to the affirmative procedure.
Clauses 45 to 51 stand part.
New clause 2—Stakeholder Advisory Committee—
“(1) The Secretary of State must establish a Stakeholder Advisory Committee to provide advice on the exercise of principal transfer powers under this Act (“the Committee”).
(2) The Secretary of State must ensure that the membership of the Committee includes representation from stakeholders, including but not limited to—
(a) industries that rely on the supply of steel, including the defence sector and critical national infrastructure,
(b) representatives of the workforce of the steel undertaking, and
(c) local authorities for the areas in which the steel undertaking operates.
(3) The Secretary of State must consult, and have regard to the advice of, the Committee before making a determination that the exercise of a principal transfer power is necessary in the public interest under section 2.”
This new clause requires the Secretary of State to establish a stakeholder advisory committee. The Secretary of State would be required to seek the committee's advice before making a determination that the exercise of a principal transfer power under the Act was in the public interest.
New clause 3—Jobs and industrial transition strategy—
“(1) Where the Secretary of State has exercised a principal transfer power in respect of a steel undertaking, the Secretary of State must prepare and publish a jobs and industrial transition strategy.
(2) A strategy under subsection (1) must explicitly set out how the Government's investment and transition plans for the specified steel undertaking will—
(a) protect skilled employment,
(b) provide and support reskilling and redeployment opportunities for the workforce, and
(c) deliver tangible economic renewal and support economic resilience in the local communities dependent on the steel undertaking.
(3) The strategy must be laid before Parliament within six months of the day on which the regulations exercising the principal transfer power take effect.”
This new clause requires that the Secretary of State publishes a report on jobs and industrial transition strategy where it exercises a principal transfer power.
New clause 5—Duty to report: 10-year strategy for nationalised steel undertakings—
“(1) Within three months of exercising a principal transfer power in relation to a steel undertaking under this Act, the Secretary of State must publish and lay before both Houses of Parliament a report containing a 10-year strategy for the steel undertaking.
(2) Any report published under subsection (1) must include—
(a) a strategy for the operation of any blast furnaces which form part of the steel undertaking,
(b) an investment plan for the steel undertaking,
(c) a vision for the future of the site of the steel undertaking, and
(d) consideration of the need for a steel procurement strategy which prioritises British steel to support the steel undertaking,
for the following 10 years.”
This new clause would require the Secretary of State to publish a 10-year strategy for any steel undertaking nationalised under this Act.
New clause 8—Contingent liabilities—
“(1) The Secretary of State may not exercise a principal transfer power in relation to a steel undertaking unless they have made a statement to Parliament on the value of contingent liabilities associated with the use of the power.
(2) The statement made under subsection (1) must include—
(a) the value of any contingent liabilities to be acquired; and,
(b) the steps the Secretary of State will take to seek to minimise taxpayer exposure to any contingent liabilities so acquired.”
This new clause would require the Secretary of State to make a statement to Parliament on contingent liabilities acquired before they exercise a principal transfer power under this Act.
Dame Harriett Baldwin
If I may, I would also like to speak to the other amendments in my name and those of my hon. Friends, and, before I do that, approach the Bill with the serious concern it deserves. Today’s amendments reflect some of the points the Opposition made on Second Reading: that the Bill is a chaotic, unplanned intervention that risks landing taxpayers with an open-ended and potentially unlimited bill. Without addressing those issues as we make this legislation, we need to really focus on the things that are currently making the domestic production of steel unprofitable, such as higher employment costs and policies in pursuit of net zero, such as carbon taxes and associated regulations and levies.
Before I turn to the amendments in detail, I put on record how much I respect the Under-Secretary of State for Business and Trade, the hon. Member for Stockton North (Chris McDonald), and his real-life expertise in the steel business. He is truly a rare example on the Government Benches of someone who has deep private-sector experience and really knows his subject—I salute that. My own private-sector expertise is as an investor, so most of the amendments in my name and those of my hon. Friends are trying to protect the taxpayer from some of the financial risks the Bill lands them with.
The fact is that nobody wanted to nationalise British Steel. The Government told us last year, when they brought in emergency legislation—and brought Members back on a Saturday for the first time since the Falklands war—that they did not want to nationalise British Steel. They may now claim to their Back Benchers and union backers that this is something to celebrate as true socialism, but the reality is that it is an outcome that the Government wanted to avoid.
The Government failed to negotiate a good outcome with the Chinese owners of British Steel. The Prime Minister and the Business Secretary went all the way to China and failed to get a deal. Whenever this Government negotiate, the taxpayer loses out. The Conservatives do not think that the Government should nationalise British Steel, because we do not think politicians should be running businesses. Since the Government intervened last year, it has cost taxpayers over £1.3 million every day.
The Bill is deeply flawed, and it is in a spirit of goodwill that I offer the Government the chance to adopt the Opposition’s amendments. I am sure that they will want to agree to them, as they are all sensible.
Richard Tice (Boston and Skegness) (Reform)
To correct the record, I have been calling for British Steel to be nationalised for seven years. I urged the previous Conservative Government not to sell British Steel to the Chinese, and if they had followed my excellent advice, we would not be in the pickle we are now in.
Mark Pritchard (The Wrekin) (Con)
It is interesting that the hon. Member for Boston and Skegness (Richard Tice) once again outflanks Labour on socialism, but there we are. As a fellow west midlands MP, I am sure my right hon. Friend will be as concerned about the Bill as I am. My constituent, Mr Peter Hughes of EverEdge, which is a west midlands steel manufacturing company, has suggested that:
“While these measures are positioned as protecting primary steel production (such as TATA Steel), they are inadvertently undermining the much larger UK steel-processing sector.”
Does my right hon. Friend share his concern, in particular, the fact that:
“While raw material costs are rising, there are no equivalent restrictions on imported finished products”?
That could be seen—inadvertently, I accept—as a tax on manufacturing. It will certainly damage UK, Shropshire, and west midlands steel manufacturing.
Dame Harriett Baldwin
As a west midlands MP, I absolutely recognise that. In fact, I was with a constituent in Worcester on Friday, Mr Michael Outwin of Industrial & Tractor Ltd, who is going to have to pay a 50% tariff. I tried to table some amendments on the tariff regime, but unfortunately, they were not orderly, so I will limit myself to agreeing with my right hon. Friend. There are many types of steel that will be affected by the tariffs that do not seem to be made in the UK. I would like the Minister to clarify how he expects people to continue manufacturing from the steel that they have been importing for some time, once the tariffs are in place.
On the Opposition amendments, I am sure that everyone in the Committee agrees that the Bill as it stands exposes the taxpayer to unlimited liability for an unlimited length of time. The Bill expropriates businesses, and that will deter inward investment into our country. You do not have to take my word for it, Dame Caroline, as it is also in the Government’s impact assessment that one of the Bill’s potential impacts is that it chills the investment environment in this sector. That is why we have tabled the amendments the Committee is considering today.
The Second Deputy Chairman of Ways and Means (Caroline Nokes)
Before I call the Minister, I will set the record straight: sadly, it is just plain old Ms Nokes in Committee of the whole House.
The Parliamentary Under-Secretary of State for Business and Trade (Chris McDonald)
I thank the shadow Minister, the hon. Member for West Worcestershire (Dame Harriett Baldwin), for her incredibly generous remarks at the start of the debate. I think we all try our best here with whatever expertise we have; of course, I recognise her expertise in finance, and will aim to address some of the serious issues she raised.
At the heart of the Bill and this debate is the future of our steel industry. The difference in opinion between the Government and the Opposition over the use of nationalisation as a tool of industrial strategy may be irreconcilable, but it is a useful tool—although not one to be used lightly. It is important that it is used in situations of market failure or some other private sector issue, which is certainly the case today. It was also the case when the previous Conservative Government briefly nationalised one of our steel companies, before that led to a failed private sector ownership.
Sir Edward Leigh (Gainsborough) (Con)
Yes, the Minister is right: Greg Clark nationalised it. As far as my constituents who work at Scunthorpe are concerned—and, I am sure, those of my hon. Friend the Member for Brigg and Immingham (Martin Vickers)—all we want is a viable Scunthorpe. We do not take an ideological line on nationalisation in this case. Given the problems we are now reading about in respect of electric arc technology in Port Talbot, can the Minister commit that the Government are fully committed to the blast furnaces in Scunthorpe?
Chris McDonald
Perhaps I can even give a slightly fuller answer than that. The particular issue with that previous nationalisation by the then Secretary of State was that it was effected merely to create a change of ownership, without actually improving the quality of the business or attracting additional investment into the business at the time. It is important to take this Bill in the full context of our steel trade measures and our steel strategy, which lays out a forward plan for the steel industry. Nationalisation is one of the tools that we can use.
The Government have been clear in our steel strategy that we see a transition to electric arc furnaces over time—there are good reasons for that, not least because they are the most productive and efficient technology available and are reliable and tried and tested—but our intervention in the Steel Industry (Special Measures) Act 2025 and our ongoing support of the British Steel business has been to ensure that we have blast furnace-produced primary steel available as part of that transition. The furnaces in Scunthorpe are the only two working blast furnaces in the UK, and they are currently our only source of primary steel.
The right hon. Member for Gainsborough (Sir Edward Leigh) also raised reports in the press about delays to the project in south Wales. Delays on such a large project are not unusual, but the specific issue in that case was around the groundworks—I would certainly be happy to expand on that more if it becomes part of the debate. I am, of course, in close contact with Tata Steel about that. In my experience of such projects, it is always difficult to understand what the duration of the project will be until it gets out of the ground, and ultimately there are issues with the groundworks there.
Let me move on to address amendment 21 and the issues raised by the shadow Minister. In terms of its structure, the Bill is very much modelled on the Banking Act 2009, which received incredibly broad support. The clauses in part 1 are vital to the operation of the Bill, and I urge the Committee to reject attempts to remove them.
While I understand the consideration that has gone into the preparation of the amendments, narrowing the scope of the definition of a steel undertaking would, in the Government’s view, introduce ambiguity rather than clarity. In practice, there are unlikely to be many undertakings operating at scale in both steelmaking and an unrelated business practice; if there were, the Government would look to exercise powers in a way that focused on what was necessary to operate the steelmaking business. The drafting of the Bill follows on from the text of the Steel Industry (Special Measures) Act. The Government are therefore of the view that amendment 21 is not necessary.
Jacob Collier (Burton and Uttoxeter) (Lab)
I fully support the need to buy British, but does the Minister recognise that JCB, based in my constituency, cannot source the grade and size of steel required for its machines entirely from the UK, and that a significant proportion of its steel comes from the EU? The proposed tariffs will apply to imported steel even when no UK alternative exists, so they are due to cost JCB millions. Will the Minister look into the matter urgently and meet me and JCB to discuss it?
Chris McDonald
My hon. Friend raises a specific point about JCB. I am reasonably familiar with its business, and I think its particular concern may be around the sourcing of plate steel. The steel trade measures—the tariffs and quotas that we announced—are designed to ensure that the UK is not subject to subsidised steel, which would damage our upstream industry, and will certainly help to support the upstream sector. Of course, we need a strong upstream sector in order to have a strong downstream sector. The issue with plate steel is that the Dalzell plate mill in Scotland, which is capable of making many of these steels, has not been operating for some time. I would be happy to meet my hon. Friend and JCB to discuss that in more detail.
Chris McDonald
I was just going to address the point the right hon. Gentleman made about the business in his constituency. I am not familiar with that business, but the general approach we have taken is to ensure that the groupings of steel under the trade measures are subject to the tariffs where those steels are or can be made in the UK, accepting that some of them are not but could be made in the UK, including at operations such as Dalzell. It is not always possible to separate all those steels out based on the groupings, so that is the purpose of the quota.
I am always interested to hear of specific examples. I had a meeting with a business last week for which this appeared to be a concern, but once we discussed the issue in detail we found that it was not an issue for the business, because of some of the arrangements that were in place. If the right hon. Gentleman would like to share further details about that case, I am keen to hear them.
Mark Pritchard
For clarity—perhaps I was not clear— a constituent of mine runs the company but the company itself is actually in another constituency, and it employs people throughout the west midlands. Could I write to the Minister about that particular case in order to seek more clarity?
Mark Pritchard
I am grateful for that. I want to make two brief points on tariffs, which the Minister mentioned. First, the Shropshire chamber of commerce has said:
“There is growing concern that tariffs may be applied to certain materials and products that are not currently available from UK manufacturers”.
I would be interested to hear the Minister’s view on that. Secondly, concerns have been raised about fabricated steel products that appear to fall outside the tariff regime. In practice, that could create an unintended incentive for steel-processing fabrication work to move overseas to avoid tariff costs. Will the Minister comment on that?
Chris McDonald
I am aware of that issue as well, and if the right hon. Gentleman would like to include all those issues in the letter, I will be happy to provide him with a response.
Gideon Amos (Taunton and Wellington) (LD)
I have been contacted by Coker Engineering in my constituency, which supplies Rolls-Royce, Leonardo and other defence companies. It can only use steels from certified electric arc mills of certain types and is worried about facing 50% tariffs after 1 July, once tariff-free goods have been used up. Will the Minister similarly look at its concerns and consider exemptions for steels that cannot be sourced in the UK?
Chris McDonald
The hon. Member might wish to let the business know that we have committed to a 12-month review of these tariffs, which, as I said, apply to steels that are made or could be made in the UK. I am aware that Speciality Steel UK is currently not operational as it is going through an administration process. Although the sort of high-quality aerospace steels that he mentioned may not be made there, I think it is probably the most likely location where they will be made, subject to those certifications, which are held by that business. The official receiver is currently in exclusive discussions with the business and a potential owner, so it is possible that the company he refers to may see a UK supplier soon, but if he shares the details with me, I will certainly be able to give him a fuller response.
Alex Ballinger (Halesowen) (Lab)
Interestingly, there is also a Coker facility in my constituency, and I have had several other businesses write to me on this subject. Only last week I visited the London Screw Company in Halesowen, which is really concerned that the 50% tariffs will increase the price of its products and make it uncompetitive. Although I am pleased that there will be a 12-month review, I wonder if that will come soon enough for such businesses in my constituency. Can the Minister provide any relief in the interim for those that may be on the verge of something more serious?
Chris McDonald
I thank my hon. Friend for raising the issue of the London Screw Company, and also for the discussion he had with me about that very company last week. It looks to me to produce an extraordinarily high-quality range of products, and certainly better than I normally find for my DIY projects, so it is my intention to patronise that company in future—we should all have more high-quality ironmongery, I believe. In a similar vein, if my hon. Friend writes to me with further details, I will ensure that my officials look at that matter, but in the first instance we would look to see whether those steels are made or could be made in the UK.
Unless there are any further questions about downstream steel producing, I will move on to address more of the shadow Minister’s comments. She talked about the public interest test in clause 2. Some of the amendments would limit the test exclusively to consideration of the three factors in clause 2, whereas amendment 23 seeks to expand them to include the prevention of closure or job losses in Wales. The inclusion of the three factors in the Bill offers some additional weight, and of course any assessment of an intervention will need to be considered against them. However, there may be a good rationale for an intervention that moved beyond that and did not sit squarely under those factors, so in our view it would be sensible not to bind the hands of the Government in that way.
The Chairman of Ways and Means (Ms Nusrat Ghani)
I call the Liberal Democrat spokesperson.
Sarah Olney (Richmond Park) (LD)
Steel provides vital materials for our national infrastructure, from defence to renewable energy, and creates thousands of jobs across the UK. The Liberal Democrats therefore welcome the action that the Government are taking to protect British Steel and ensure that the blast furnaces in Scunthorpe do not go cold, but we are clear that the nationalisation of British Steel must be a temporary step to rescue the business before it can be returned to the private sector. We believe in a thriving, privately run steel industry, supported and empowered by the Government through an effective steel strategy.
Although the Liberal Democrats support this step, the Government must provide more detail on the plan, including how they will find private co-investors who can help to modernise the sites and put the money in to help to create more jobs. They must also ensure that the key stakeholders, including industries that rely on steel such as defence, are properly engaged in and represented through the process. We cannot afford another collapse of British Steel in a few years’ time, and we must move on from interim short-term measures to create a robust long-term plan for the future of the plant and sustainable domestic steel production, with an emphasis on national security.
I wish to speak first in favour of amendment 1, which stands in my name. Fundamentally, it is about parliamentary accountability. If the Secretary of State is to exercise a significant transfer power, Parliament should, at the very least, be told why that action is necessary and in the public interest. The amendment would not prevent the Government from acting; it would simply require Ministers to explain their reasoning before exercising the power, providing far greater accountability and transparency. Requiring a statement to both Houses would help to ensure that the use of the powers is proportionate, justified and open to democratic oversight. The Government already argue that the powers will be used only where necessary. If that is the case, there should be no objection to setting out those reasons clearly before Parliament. Amendment 1 proposes a modest and reasonable safeguard. It does not create a veto or impose an onerous process; it merely asks Ministers to account for their decisions.
I wish to speak in favour of amendments 2 and 3, which seek to ensure that regulations relating to property transfers and share transfers are made subject to the affirmative procedure rather than the negative procedure. The transfer of property or shares by ministerial regulation is not a minor or purely technical matter. These provisions are the heart of the Bill and give the Government significant powers with substantial financial, operational and public consequences. Given the importance of such decisions, does the Minister not agree that it is entirely appropriate that Parliament should approve such regulations, rather than having to rely on the limited scrutiny afforded by the negative procedure? The affirmative procedure would guarantee a debate and a vote in both Houses, ensuring proper democratic oversight before the powers were exercised. At their core, amendments 2 and 3 are about reinforcing accountability, transparency and parliamentary sovereignty in the exercise of delegated powers, and I urge Members to support them.
New clause 2, which also stands in my name, would establish a stakeholder advisory committee to ensure that decisions made under the powers in the Bill included input from the relevant groups and those most affected. The exercise of principal transfer powers could have major implications not only for the steel undertaking itself, but for workers, local communities, supply chains and strategically important industries across the country. The proposed committee would bring together voices from industry, the workforce and local authorities, ensuring that decisions were grounded in practical expertise and real-world consequences. The inclusion of sectors such as defence and critical national infrastructure is particularly important, given the strategic significance of the steel supply to national resilience and economic security. A structured advisory mechanism would improve transparency, strengthen confidence in decision making and help to ensure that interventions are sustainable and effective. New clause 2 is about ensuring that the public interest is determined not behind closed doors, but with the benefit of broad expertise and stakeholder input.
I wish to speak in favour of new clause 3, which recognises that intervention in a steel undertaking cannot simply be about ownership or transfer powers in isolation. It must be about people, jobs and the long-term future of industrial communities. If the Government exercise these significant powers, they should be required to set out a clear strategy for protecting workers and supporting economic transition. Not only is the steel industry strategically important to the national economy; it is often central to the identity and prosperity of the local communities within which it is situated. Workers in these industries possess highly valuable and specialised skills. Any transition strategy should therefore prioritise the protection of skilled employment wherever possible. Where change is unavoidable, there must be a serious commitment to retraining, reskilling and redeployment opportunities so that workers are not left behind. New clause 3 would help to ensure that Government intervention was accompanied by a coherent industrial strategy, rather than being another short-term fix and crisis management.
Steelmaking is of vital strategic importance to the UK. It creates thousands of jobs across the country and is central to many communities, and we rely on it for essential parts of our national infrastructure, from defence and transport to clean energy generation and advanced manufacturing. Although the Liberal Democrats are supportive of the pace and urgency of the Government’s action to protect British Steel, nationalisation must be a temporary step, and the Government must ensure adequate transparency and accountability throughout the process. I therefore urge the Minister to support these amendments, to ensure that the legislation can deliver the necessary support to the steel industry, while balancing the needs of local communities and workers and ensuring that the necessary steps are taken to ensure thorough parliamentary accountability.
Sarah Champion (Rotherham) (Lab)
As you know, Madam Chair, I have been urging successive Governments for over a decade to back the British steel industry, so it is genuinely a pleasure to be here today as the Government do just that. I support this historic Bill.
Steel is essential for the UK’s economy. It supports thousands of well-paid, skilled jobs and plays a crucial role in ensuring Britain’s security, particularly in an ever more volatile and uncertain world. Yet for years the industry has been allowed to wither. Production has fallen and plants have been lost—and with them jobs, capability and capacity. We simply cannot afford to allow this precipitous decline to go on any longer.
Rotherham is a steel town. It has seen the consequences of past Governments’ neglect up close. Speciality Steel, which is based in Rotherham—and Stocksbridge—should be a crown jewel in our economy, but it has been allowed to lurch from crisis to crisis, choked of investment and left at the mercy of unscrupulous ownership, unfair competition and a lack of vision. The plants currently stand still, shuttered amid the fallout of Liberty’s collapse. The workers are furloughed and uncertain about what their futures hold. I would be grateful if the Minister could update the Committee on the current state of the sale, which is now in its final stages.
My concern is not limited to Speciality Steel. Steel in Rotherham is at the centre of our local economy, and the crisis has had a substantial impact up and down the supply chain. The Minister’s ambition for steel’s renaissance could also be a rebirth for local businesses and local communities, but that requires investment, foresight and commitment. The Government’s steel strategy sets out a strategic vision for the industry and, crucially, delivers real and profound change for the sector as a whole. With £2.5 billion of investment in the sector and an ambitious but achievable target of 50% of the steel used in Britain to be produced here, the strategy is a blueprint for a revitalised domestic steel industry; it is one that has been roundly welcomed by the sector.
Perhaps most importantly, the strategy sets out a new approach to steel imports. Time and again, I and other steel MPs in particular have warned that a failure to tackle cheap, often state-subsidised and heavily polluting imports would destroy any attempt to increase domestic production. Without a level playing field, British steel cannot hope to compete. It is therefore welcome that the Government have acted to protect UK steel producers from unfair competition through a range of new trade measures, quotas and tariffs. While that is good news for steel producers, we do need to get the details right. I thank hon. Members on both sides of the Committee for raising specific examples of that.
Alongside steel producers, Rotherham hosts a large number of steel stockholders and downstream businesses. I have raised with the Government a number of instances in which trade measures have been introduced on products not currently produced in the UK, or where UK production and capacity is far below demand. I urge Ministers to act to ensure that those businesses are not impacted unfairly and that trade measures conform to the realities of the UK market; to do otherwise risks inadvertently harming the very industries and communities that the Government seek to defend.
While the Bill will not have a direct impact on steel production in Rotherham, it does send an important signal. I am proud that the Government are taking resolute action to ensure that they have the necessary tools at their disposal to safeguard the future of British Steel in Scunthorpe. I hope that this will set a precedent as the situation with Speciality Steel develops and that they will take similarly decisive action there, should it prove necessary.
With the right support, British steel can—and should—play an ever greater role in our economy, in infrastructure projects and, crucially, in our national security. I know that steelworkers in Rotherham will be relieved to have a Government who are so clearly on their side—on the side of good jobs and a dynamic economy—and, most importantly, a Government who back British steel.
Sir Jeremy Wright (Kenilworth and Southam) (Con)
I will focus my remarks on clauses 1 to 3 of the Bill and the breadth of the powers that they give to the Secretary of State. I start with the meaning of a “steel undertaking” in clause 1, which is one
“that carries on a business consisting of or including…the manufacture or processing of steel, or…iron”.
As the Minister will know, I raised in an intervention on the Secretary of State on Second Reading—indeed my hon. Friend the Member for West Worcestershire (Dame Harriett Baldwin), who speaks from the Front Bench, also mentioned this earlier—that that wording could appear to include undertakings that have as little as 1% of their business in iron or steel.
Richard Tice
The very reason that the Government need the ability to extend the sunset clause is that if they listened to the amendments from the Conservative party, the delays from various items would be so great that they could go beyond the two years. Of course the Government need the ability to extend the sunset clause.
Sir Jeremy Wright
I recognise that the hon. Gentleman does not normally engage in the detail of legislation, but if he did, he would know that this is the Committee stage, where we look at the detail.
What the Government could perfectly properly do is pass the legislation, as amended by my hon. Friend the Member for West Worcestershire, and if they felt at the end of the sunset clause period that they needed further powers, they could come back to this House with further primary legislation and seek our consent to do that. The difficulty with what we have before us is that the Secretary of State has the power to extend the sunset clause indefinitely, by regulations, over and over again. That is what the wording of the Bill says, and that seems to me to be something we should not accept here. What we should do is reinstate the natural, ordinary meaning of a sunset clause, which is set out in clause (3)(1), by removing the rest of that clause. If, as the hon. Member for Boston and Skegness (Richard Tice) suggests, the Secretary of State wants to extend those powers, he should seek the authority to do so in primary, not secondary, legislation.
These deficiencies in the Bill are cumulative: the power to indefinitely extend the Secretary of State’s proposed powers is more pernicious because the powers are so broad, and the huge latitude that he would have to define the public interest matters more because the Bill may apply to many more companies than might have been thought when hearing the Government’s original intentions for the Bill. Plus, of course, the Secretary of State’s consequent powers, which are set out in the rest of the Bill—having decided to nationalise and make that initial transfer decision—are mostly constrained only by the scrutiny of secondary legislation, so the initial transfer decision is all the more important. It is my view that the Secretary of State’s powers, as defined in clauses 1, 2 and 3, are simply too wide and need to be constrained.
The Government make two substantive arguments in response to that view, and I want to address those arguments. The first, which the Minister put forward earlier, is that the Government are doing only what a previous Government did in the Banking Act 2009, and that the powers they seek to take here are no wider than those taken in that Act. I do not agree, for three reasons.
The first reason is that the powers in the Banking Act were premised on the existence of a special resolution regime, where the bank in question was already in financial trouble. As far as I can tell, this Bill does not require the relevant steel undertaking to be in any trouble at all for nationalisation to be an option. The second reason is that the Act provides for a temporary transfer to public ownership. This Bill does not use the word “temporary”, and again, I can find nothing in the Bill that prevents a nationalisation being permanent. The third reason is that the Banking Act requires the Treasury to consult before using its powers under that Act. There is no requirement in this Bill for the Secretary of State to consult anyone, so I am afraid it is just not like the Banking Act.
The Government’s second argument, which I discovered lurking in the memorandum from the Department for Business and Trade to the Delegated Powers and Regulatory Reform Committee—I am sure we have all read it— is that broad powers such as the right to define the public interest are
“buttressed by administrative law, including the need for interferences with property rights to be proportionate”.
Of course, that is so: the courts may intervene if the Secretary of State tries to use his powers irrationally or unreasonably, but Parliament should not be subcontracting our work to the courts.
If the legislative powers as drafted are too broad, it is up to the legislature—us—first and foremost to constrain them. The Secretary of State has consistently maintained, as has the Minister, that he wants only the powers needed to act where Government action is unavoidable, and only for the period needed, but the powers that he has in the Bill go well beyond that, and they could and should be restricted.
Lee Barron (Corby and East Northamptonshire) (Lab)
I want to start off by saying that I find it absolutely incredible when people turn around and say that our Government should not be intervening and running services, when they are happy to allow other countries’ Governments to run our services and utilities. To be honest, I get a bit tired of it, because it is essential that we do this if we are going to save industries, save sectors and save jobs. That is why we are right in doing this.
I want to speak on amendment 21, new clause 8 and new clause 5. It was a privilege to be recalled here on a Saturday last year to pass the emergency Steel Industry (Special Measures) Act 2025 to save the Scunthorpe works, and I am just as happy to be here today to see this Bill go through its first day of Committee. Since last year, it has become clear that public ownership is in the national interest. Corby is a town built on steel—steel that built this country. At one time, the Corby steelworks was the largest combined steelworks in Europe. I recognise that the Bill does not nationalise the steelworks in Corby, but it will make sure that the sector does well, and where that happens, that will ensure that the other aspects of steel do well.
In 1967, it was the Labour party that nationalised the steelworks and put British Steel in charge. It did so because it knew that home-made steel was essential for our national security, for our economy and for thousands of jobs. In 1980, a Government who failed to see those opportunities closed the steelworks, and with that, tens of thousands of jobs went and almost a third of people in my constituency became unemployed. That is why it is so important that British Steel should be allowed to continue.
This Bill marks a reversal in direction. It shows what can happen when we have a vision for our economy and the dedication to see that vision through. How could the last Government shape our economy and create jobs when they failed to even create an industrial strategy? This Government have a strategy. Their decade-long industrial strategy, and the steel strategy announced in March, show that.
The steel strategy provides £2.5 billion through the National Wealth Fund to help rebuild our steel sector so that we can move towards 50% of all British demand for steel being made in this country, ensuring our security in an unstable world with the capacity for our own virgin steel supply. That is what this Bill leads to, and that is what is going to happen as a result of it.
British steelworking powered the first industrial revolution, and it can do so again, building the renewables and technology for the future. We still have a steelworks in Corby, and we want to make sure that Corby and the towns like it across our country have a new and secure future. I believe that the passing of this Bill will ensure that that happens.
Richard Tice
It is a pleasure to stand up and support the Government and this Bill, because we all know that the ability to make primary steel is absolutely in the public interest, and it therefore automatically meets the public interest test. We cannot be the only G7 nation without the ability to make primary steel using a blast furnace, but that will be the consequence if this legislation does not go ahead.
The Conservatives’ line of thinking is to just rely on the private sector. Well, they tried that for some 14 years, but the reality is that the state of the blast furnaces means that they need investment for relining, renewing and rebuilding. The private sector has said that it is not there yet, but it could be, so we need a period of time when the industry has the commitment of the public sector to ensure that a thriving primary steelmaking capability can exist.
Sir Jeremy Wright
I understand the logic of the hon. Gentleman’s argument. He has referred several times to the series of proposals being made in Committee by the Conservative party, as outlined by my hon. Friend the Member for West Worcestershire (Dame Harriett Baldwin). They come to this: that no Government should be able to create for themselves a very wide definition of what a steel undertaking should be, that they should not be able to define for themselves without restriction what the public interest may be, and that they should not be able to extend indefinitely, without parliamentary authority, the effect of the Bill. Will the hon. Gentleman tell us what he objects to in those proposals?
Richard Tice
I will indeed. My objection is that the consequence of the Conservative party’s amendments would be to delay the investment that is required to get on with this. People have expressed concern about the current losses. The last thing we should do is create bureaucratic delays that prevent the investment that would turn the cash flow around from negative to positive.
Martin Vickers (Brigg and Immingham) (Con)
I have already made clear to my constituents that I do not oppose the Bill, but I support the Opposition Front Benchers in trying to constrain its cost. Will the hon. Gentleman give a specific figure, or is the Reform policy just to spend, spend, spend?
Richard Tice
Actually, the consequence of the Conservative party’s amendments would be to delay the vision and investment that is required, and therefore to increase the losses. That is why they should be ignored. If you are going to do a job, then for heaven’s sake, do it properly and get on with it. That is the difference here.
We need the blast furnaces to be refurbished and relined, and we need a plate mill. We need proper, committed investment. We need the Minister to have a pro-British steel procurement strategy at all levels of the public sector, from warships and the railways to even the planning conditions for a new Chinese embassy—let’s make it with British steel from Lincolnshire, not cheap Chinese steel from far away.
Graham Stuart (Beverley and Holderness) (Con)
I am trying to understand how constraining Government powers in the three areas of concern would in any way lead to a delay. I do not think that any constraints imposed would stand in the way of this undertaking. In what way would there be a delay? I may not have sufficiently understood the linkage between such constraints on Government powers in other undertakings and how on earth those would impact this particular one.
Richard Tice
It is my judgment that the Conservative party’s amendment would prevent the Government from getting on and setting out the vision, placing the investment that is required, and giving the confidence to everybody that there will be a steel-making capability for primary steel. Once we get that investment in the core asset in Scunthorpe—with a refurbished, renewed blast furnace that is ready for the next 50 years—then, with brilliant management from the private sector, we will start to attract private sector capital, which we all want to bring in. This is a moment that requires the proper seed investment, the commitment and the courage from this Government to get on with it, which was so lacking in the previous Administration.
Sir Edward Leigh
I agree with a lot of what the hon. Gentleman says. We can surely agree on this point: what is really killing Scunthorpe are the insane green energy policies and the fact that we have the highest energy costs in Europe. If we had a sane energy policy, we could start to make a profit at Scunthorpe.
Richard Tice
The Father of the House is absolutely spot on. The net-stupid-zero policies have been catastrophic across the piece, and I fear that those very policies are the reason why people are concerned about the possibility of opening an electric arc furnace. That puts even greater pressure on the need to have a renewed, brilliant, wonderful blast furnace capability for the next 50 years. If we achieve those things, we can bring in private sector capability with a pro-British procurement strategy. That will give confidence to all.
It has been mentioned that the Bill would somehow prevent other investment from the private sector. The discussions that I have had with overseas pension funds and overseas sovereign wealth funds suggest exactly the opposite. They suggest that, with this sense of commitment—what I like to call a joint venture with the core asset, under public ownership—we will attract more international investment, because people will know that there is a long-term commitment as opposed to the wibbly-wobbly, flip-flop approach of previous regimes. That is the reason that we need to get on with this. We need to ignore any delaying amendments.
Let us have the vision. New clause 5 would require the Government within three months to set out that 10-year vision and 10-year commitment to the blast furnaces and others in the steel undertaking, to ensure that we have a vibrant and, ultimately, viable primary steel-making capability in the United Kingdom.
Alan Strickland (Newton Aycliffe and Spennymoor) (Lab)
I am pleased to speak in support of the Bill and comment on a number of the amendments. I do so as a Member of this House who represents a proud manufacturing constituency, which includes a number of industries that rely on steel in a variety of ways, from the rail industry and advanced manufacturing to the cluster of innovative defence and space-related companies at NETPark—North East Technology Park—in Sedgefield. Steel is not only used by some of those companies, but extensively used in their supply chain. It underpins manufacturing not just in my seat, but across the north-east and many other constituencies in the country, as we have heard. I have also campaigned successfully to protect sovereign supply of key materials in my constituency and the wider economy. Given the importance of steel to our national security and national critical infrastructure, it is crucial that we get our approach to steel right.
So what does this mean? First, as hon. Members across the House have said, we need to ensure that the Government can act quickly and with agility. That is why I have concerns about several amendments, which, as other colleagues have raised, could slow down the Government’s ability to act decisively. That appears in a number of amendments but, for example, amendments 2, 3, 18 and 19 and new clause 2 seek to impose additional requirements on Ministers before they can act using the provisions of the Bill. Others have gone into some of the specifics, but my concern is that when considered in the round, these proposed changes would have the cumulative effect of hampering the Government’s ability to act and to act swiftly. It is critical that Ministers can act because that is the key purpose of the Bill; that is why we are here debating it today.
Why is it important that Ministers can act quickly, and why might some of the amendments be a challenge? Because, as we are discussing, when a steel plant faces significant challenges and the Government are minded to intervene, Ministers need to achieve three things. First, they need to be able to provide certainty about the future of the business, which helps sustain the workforce and gives certainty to its supply chain and reassurance to its contractors. We have heard Members talk from their private sector experience—I myself worked in regeneration and housing previously—that when there is doubt about the future of an industry or a particular business, or there is a particular commercial concern, we know that when business confidence starts to fall, if action is not taken quickly, the lack of confidence in the supply chain and the contractor chain can do serious damage.
The second priority for Ministers must be to minimise risk. We know not just in this process, but in other similar processes undertaken by the public and commercial sectors that the longer the process, the higher the commercial and legal risk and the more likely it is that we will not get the outcome we desire. It was that desire to act swiftly and show significant national leadership that, as hon. Members mentioned, is why we were all recalled last year on a Saturday, to intervene quickly in the steel sector.
Thirdly, and crucially, the reason that speed is important is if this is agreed, it is important that Ministers have the powers they need to enact the will of Parliament quickly. Quicker intervention in circumstances like this, given the factors we have discussed, is likely to be more successful, particularly in complex cases as we see at British Steel in Scunthorpe.
Graham Stuart
The hon. Gentleman makes the point about the need for speed in these circumstances, but perhaps he could explain to the House why the endless resetting of a sunset clause, contradicting the whole purpose of a sunset clause, plays into the need for urgent action right now? Or does he agree that it is something that should be looked at again and does not need to delay any of the effective action for which he is calling?
Alan Strickland
Ministers will speak for themselves, but I think they are seeking the flexibility to act in the national interest and to do so appropriately. My concern is more with some of the clauses that add lots of prerequisites to what needs to happen before Ministers can act. My view is that in the limited, and hopefully rare, circumstances where Ministers do feel the need to exercise these significant powers, they need to be able to act quickly, and that is what we are discussing today.
Several of the amendments relate to concerns around value for money, which of course is an incredibly important consideration. It is important for all of us to remember that one of the key reasons we are here today is precisely because Ministers have said that they want to do more to ensure value for money for taxpayers delivered in the Government’s potential intervention in British Steel Scunthorpe. That is why my hon. Friend the Minister for Industry was clear in May that the Government intended to bring this legislation forward precisely because Ministers were unable to agree suitable terms with the current owner of British Steel that represented a
“responsible use of public money,”
so value for money has been a key driver of ministerial action on this matter and the reason we are debating it in the Chamber today.
I turn to new clause 5, which the hon. Member for Boston and Skegness (Richard Tice) was just describing. I am sort of slightly astonished that Reform, a party with no plan for steel, has put an amendment demanding a plan for steel. I am pleased to tell Reform Members who are here that we already have one. The Labour Government, as the Minister mentioned, published the UK steel strategy in March. It clearly addresses a number of the important points that the hon. Member rightly mentioned earlier, including specifically the need for the public sector to buy more steel. A year ago in June 2025, the Cabinet Office published guidance—procurement policy note 22—that required public bodies nationally and locally, and their executive agencies, to ensure that UK-produced steel is routinely considered in public procurement and that this is done at an early stage in the process, so the mention of public procurement around steel in that amendment is redundant. Ministers have already issued clear guidance on that some time ago.
Ann Davies (Caerfyrddin) (PC)
I rise to speak to amendment 23, tabled in my name, which seeks to strengthen the public interest test that decides when Governments may nationalise steel sites under the Bill. Specifically, it would ensure that nationalisation can and should be used to prevent the loss of jobs in Wales and to prevent the closure of 16 sites in Wales.
Why is this change needed? Currently, the public interest test notes three specific factors for when nationalisation powers may be used, two of which are
“the construction, maintenance and operation of critical infrastructure in the United Kingdom”
and to support
“the economy of the United Kingdom or any part of the United Kingdom.”
While those provisions could allow the Government to intervene to protect Welsh steel sites, they offer no guarantee that they will.
Welsh steel communities know all too well what happens when Governments choose not to act. We have experienced this before. Port Talbot stands as the most painful example, where the blast furnaces were allowed to close in 2024, resulting in thousands of job losses and devastating a community that had a proud history of making steel for over 100 years. Before the closures Wales had the largest steel workforce in the UK, with 9,300 people employed in the sector. The Labour party had several years in opposition prior to entering government; the Government could have developed a plan to nationalise Port Talbot to safeguard jobs, as they have done for British Steel in Scunthorpe. They could have acted, but chose not to. Port Talbot deserved equal treatment. Wales deserves equal treatment. The Welsh economy cannot afford a repeat of the calamity of Port Talbot.
The need for certainty is not theoretical. Only recently, last Thursday night, a major fire at Port Talbot caused significant disruption. We are so grateful to the emergency services for acting so quickly, evacuating the area so there were no casualties, but significant damage was caused to the steelworks. We have also learned that the installation of a new electric arc furnace at Port Talbot may be delayed for months because of an electrical connection issue. I believe that is a planning issue with the local authority. These events have not helped the precarious situation at Port Talbot. To safeguard the site and jobs, the Government should make it clear that they will step in to prevent closure or job losses, as a measure of last resort—a position Plaid Cymru has consistently called for.
Steel jobs in Wales are not just jobs: they are strategic assets. They are essential for the future of our economy, for major infrastructure projects and for the development of offshore wind in the Celtic sea. They are also the backbone of our communities from one end of Wales to the other. Alongside Port Talbot, Wales is home to the Trostre works in Carmarthenshire, 7 Steel in Cardiff, Tata in Llanwern and the steelworks at Shotton in the north-east of Wales. Each of these sites deserves the same level of protection that is being offered to sites in England. All deserve equality.
Graham Stuart
Does the hon. Lady share my concern that the funds put in place by Government—£2.5 billion for the steel plan—are completely inadequate to match the enthusiasm of Members across the House for nationalisations? The National Audit Office suggests there would be £1.5 billion in losses from running the Scunthorpe plant alone, without any investment and without any compensation for Jingye, so the £2.5 billion would be rapidly gone. The truth is that this House and this Government are unable to put in place the sums of money that would allow Scunthorpe sensibly to be supported and invested in, let alone the long string of 16 sites in Wales that the hon. Lady so bravely speaks up for today.
Ann Davies
I thank the right hon. Gentleman for his intervention. Some £500 million has been ringfenced for Port Talbot; that money is rapidly gone, with no benefit to the local community, but that is another issue that I will not talk about now.
We want an end to the double standard. Welsh steel must be given the same guarantees as English or Scottish steel. What we want is equality for all the sites across the UK; we want the same security and the same commitment to preventing closures and safeguarding jobs.
Luke Myer (Middlesbrough South and East Cleveland) (Lab)
I am delighted to welcome the Bill, and will speak to a couple of the new clauses and amendments. I declare my role as chair of the all-party parliamentary group on steel and metals-related industries, through which it is a pleasure to work cross-party in the interests of the industry.
Just outside Middlesbrough, wedged between the gas pipes and the railway, is an old path. Someone walking there 200 years ago would have found sailors trudging through salt marsh hamlets, and 100 years ago they would have found steelworkers—hundreds of them—walking home on the tired commute. The cinders underfoot gave the path its name: “the black path.”
If someone walks that path today, they will see the remnants of a bygone age for Teesside iron and steel. They will see a former railway station, now disused, which was used for industry. They will see a lost ironworkers’ village and the red wild flowers that thrive on former slag pile soil. And, of course, they will arrive at one of the largest brownfield sites in Europe: the former Redcar steelworks, which once stood as a great shadow on our skyline, the heart of the region, pumping out steel across the world.
The phrase on Teesside goes, “We built the world.” Everything from the Sydney harbour bridge to the Churchill War Rooms were made with Teesside steel. It can never be forgotten that, in 2015, the then Conservative Government’s laissez-faire approach to Chinese steel dumping denied us the intervention that we needed on Teesside. The closure of Redcar steelworks tore a hole through our region and cost thousands of jobs. I pay tribute to my constituency neighbour, my right hon. Friend the Member for Redcar (Anna Turley), who at that point was a newly elected MP and fought tirelessly for the workers of Teesside, but we can never allow a situation like that to happen again.
We cannot change the past, but steel is not our past, as the workers at British Steel Special Profiles at Skinningrove in my constituency will tell us, or the workers at Teesside beam mill at Lackenby, along with the many supply chain SMEs on Teesside. Having run a Teesside steel company for many years, the Minister for Industry knows that landscape well. I commend the decisions that the Government have taken, particularly on British Steel, that have protected and safeguarded jobs in my constituency and my region.
Graham Stuart
The hon. Gentleman is giving a powerful speech and showing great expertise. Is he confident, as so many critics of the steel plan were not, that the £2.5 billion that has been found by the Treasury is sufficient to allow the interventions that he so enthusiastically supports? If it is not, is there not a danger that we will not invest in things, but just bleed out public cash on facilities that continue to be uncompetitive and do not get renewed? If we do not put the right resource in, as France and other countries have arguably done, we will be losing out and not winning.
Luke Myer
As a Back Bencher, I will always fight for more funding to modernise our steel industry. What I do know is that the current owners of British Steel are not responsible owners. We saw last year the crisis that was created when they failed to provide sufficient supply to keep the blast furnaces running. We cannot allow the current situation to continue if we are to protect our domestic industry. This Bill is about having the powers to nationalise and ensure that the national interest is served. Whether there is sufficient funding is a question on which I will continue to push the Government.
We are not focusing today on clause 58, but the freedom to make the necessary fiscal decisions to support operational stability and competitiveness is fundamental to the sunset clause we are discussing, as well as the potential for ongoing considerations on other critical assets that the Bill might be used for. It would be helpful to hear more about the Government’s intentions on issues like energy and procurement, as my hon. Friend the Member for Newton Aycliffe and Spennymoor (Alan Strickland) said. We had a positive intervention from the Cabinet Office last year and the ambition to increase domestic steel market share back towards 50% is right, but the test will be in the delivery.
For too long, we have had industrial strategies while approving publicly backed projects that import vast quantities of overseas steel. Taxpayers rightly expect public investment to strengthen British industry and British jobs. Mechanisms like contracts for difference and other subsidy schemes must align much more closely with procurement objectives, so that public money genuinely supports UK supply chains. The forthcoming defence investment plan is a major opportunity to ensure that we are using UK steel across the country in industrial communities to support national security. At the end of the day, economic security is national security. Britain cannot become dangerously dependent on overseas steel for critical infrastructure or defence capability.
While I support the shift to electric arc furnaces and the increased focus on how we use domestic scrap, which is welcome, Britain should seek to retain some primary iron capability. Other countries are investing heavily in technologies like direct reduced iron. We need only look at Luleå in northern Sweden, for example, where an operational hydrogen-powered DRI facility is already producing steel. That has not held the region back in any way. Economically, it has had the opposite effect of attracting inward investment in new industries, from data centres to clean power. I would like to hear a little from the Minister about DRI and whether we will be looking seriously at that, but I do not wish to stray too far out of the scope of the Bill.
The legislation was brought forward in the context of British Steel, but we should not pretend that British Steel is the only critical asset that may ever require Government action. There may be other sites, capabilities and parts of the supply chain where future intervention is needed to protect jobs, sovereign capability and the national interest, so my concern with amendment 12 is that it would make these powers too easy to lose. A future Government may not share the same commitment to active industrial strategy and may not be as willing to renew the tools needed to protect the sector, so we should not remove the extension mechanism now because we may leave workers and industry more exposed later on.
Opposition Members made the point that politicians should not run businesses, although of course the Minister for Industry did run a steel business for many years and did so very effectively. They may mean that politicians from this country should not run businesses. The Bill is before us because of the approach that Jingye has taken. The Chinese steel industry has long benefited from huge state subsidies, and cheap state-directed finance, energy support and overcapacity policies. Beijing did not leave it to the market; it used state power aggressively to expand industrial capacity, which is worth bearing in mind.
I will finish on this point. While the Government cannot say which assets they wish to use these powers for, it is evident that British Steel cannot remain in Chinese hands. I do not know what the long-term ownership structure will look like—perhaps it will be modernised and sold to a new buyer, or perhaps it will be taken into public hands and remain there, with steelworkers having some stake in the company that they built—but I do know this. When a Labour Government intervened to create the nationalised British Steel Corporation in 1967, Teesside enjoyed such high employment and high wages that it was classified as one of the best places to live anywhere in the UK. It brought stability to tens of thousands of families and built the second largest blast furnace in Europe.
In 1979, a very different Government took office with a very different theory of Britain—a small state and a blind faith in the global free market. In just five years, our region had the highest registered unemployment rate anywhere in Great Britain. By the end of Thatcher’s premiership, almost 250,000 jobs in our region had gone. They took a British industrial economy and turned it into a globalised service sector economy.
Today the Thatcherites are back, with a new logo and a new face. They will talk a big game on steel, but we have been here before. It is my belief that only a social democratic Government can truly protect our steel communities and equip them to face the future, because a social democratic Government recognise something that a foreign private owner cannot: the value of protecting sovereign industry, even when the going gets tough.
This issue is about our jobs, but it is also about our security. Will we be left exposed in a volatile world, or will we build for the future again? I hope that this Labour Government have the courage and ambition to do so.
The Chairman of Ways and Means (Ms Nusrat Ghani)
Minister McDonald, I believe you wish to contribute again.
Chris McDonald
There is so much so say, and so little time until the rise of the House. Members who are standing may wish to take a seat, because we might be here for a little while.
Chris McDonald
Indeed, Madam Chair—I was banking on 10 o’clock.
I thank all Members, including the shadow Minister, the hon. Member for West Worcestershire (Dame Harriett Baldwin); the Liberal Democrat Front-Bench spokesman, the hon. Member for Richmond Park (Sarah Olney); and the former leader of Reform, the hon. Member for Boston and Skegness (Richard Tice), for the extremely constructive and civil way in which this debate has been conducted. I know that that comes from a real enthusiasm among all Members in the Committee for having a successful steel industry.
In fact, there were many points of agreement in the debate. In debating the amendments to the first part of the Bill, the importance of the steel industry came through extremely strongly, as did the importance and reliability of the use of public money. We all share that view across this Committee, and we also want there to be extreme care in the use of the powers in the Bill. I know that Members who moved amendments in that regard are concerned about that, and the Government are too. I will address some of those points, and I will endeavour to address some of the points raised by Members during the debate. I will start by addressing a recurring theme in the debate: what nationalisation is.
Jim Shannon (Strangford) (DUP)
I am thrilled that the Minister has until 10 o’clock to speak—if you are agreeable, Madam Chair, we will have lots of interventions. The issue is not whether people agree with the nationalisation of the steel sector, so we can set that aside; the issue is whether we will have a steel manufacturing sector that can produce steel for all the United Kingdom of Great Britain and Northern Ireland. We in Northern Ireland need the steel from here, and we need it for our defence sector, which is really important. Just before Christmas, my pastor in my church told me, “There are 69 wars in the world.” We have to be prepared for the world wars we are going to have to fight. We need a steel sector to do that, and what the Minister has put forward is a justification for it.
Chris McDonald
The hon. Gentleman is quite right. The steel sector is vital for our national security and our infrastructure and construction industries throughout the whole of the United Kingdom, including in Northern Ireland. He speaks very well about that.
Nationalisation or national ownership is not an objective in and of itself; it is simply a pragmatic tool of industrial strategy that can be deployed with care in order to achieve legitimate aims of Government. If we think about some of the nationalisations of the past, it may be that some of those were driven by the pragmatic use of industrial strategy, and it may be that some were driven by ideology. In general, the way that the nationalisation of a business works is that the Government intervene when a business is in distress or is no longer viable but is important. Those businesses are returned to the private sector only once they are successful.
Contrary to the narrative that is often peddled about public ownership, the purpose of public ownership is to pick up businesses when there is a market failure or where a private sector operator is unable to continue. We have seen that in other instances, such as in the railway industry. I see nationalisation simply as a useful and pragmatic tool of industrial strategy.
Sarah Champion
Does the Minister share my concern and confusion about the comments made by the right hon. Member for Beverley and Holderness (Graham Stuart)? I was not sure if he was supporting the nationalisation of British Steel but thought that there was not enough money or that there was too much money. However, he seemed to support the fact that in Europe, the Government subsidise electricity, and I felt that he wanted that to happen here. For all the reasons that Members have said, I just want a really strong and secure steel industry in this country.
Chris McDonald
I think the right hon. Member for Beverley and Holderness (Graham Stuart) also wants a strong steel industry, but he has been quite clear that he does not see nationalisation as a tool for delivering that—I think that is fair. He is also concerned about the use of public money, which I think is fair as well. I shall address both of those points as I continue.
I am very pleased that my hon. Friend the Member for Rotherham (Sarah Champion) raised those issues. This is an opportune time to mention that in her earlier comments, she asked for an update on the current status of the Speciality Steel UK business, which I know affects her constituency and that of my hon. Friend the Member for Penistone and Stocksbridge (Dr Tidball). That business shows the power of a productive Government intervention, working carefully with industry, because the Government have underwritten the costs of the official receiver to allow a proper sale of the business. The official receiver is in exclusive discussions with a potential buyer, and there was a high level of interest in the business from the market.
As we look forward to the potential sale of the business, we can see the vital role that the Government have played in recognising that steel undertakings are complex, that it can be difficult and can take time to assess them, and that they require high levels of working capital. That contrasts significantly with Governments in the past, who allowed steel companies to close simply by not allowing that process to continue.
Chris McDonald
I will take an intervention from the right hon. Member for Beverley and Holderness. Given that he was referenced, it would be helpful to give him the right to reply.
Graham Stuart
To help the hon. Member for Rotherham (Sarah Champion), I do not think I said anything about subsidising. What I am looking for, and what I think all of us across this Committee would like to see, is the continuation of steel, especially in a dangerous world. I was questioning whether we have a coherent strategy and sufficient funding to take the steel industry—the specific site in Scunthorpe and others—on the journey that the Minister set out, which requires intervention to take it back to being a thriving industry. I worry that there is not such a pathway or sufficient resource, so we could be in the worst of all possible worlds, where we just bleed public money without it leading to the restitution of a healthy steel industry in this country. That is what I am looking for an answer to.
Chris McDonald
Let me address that point. It is helpful for us to think about the potential options. There is agreement across the Committee that we want a successful and thriving steel industry, and the Government have made some serious financial commitments. We have committed £500 million to support the transformation of the plant in Port Talbot, which has attracted another £500 million of private sector investment. We have committed £2.5 billion through our steel strategy and an additional £400 million to support the Forgemasters operation, which is successfully under public ownership.
We have to think about the potential options. Given that the Government have put that money on the table and are seeking private sector partners to work with for all our steel plants, the alternative would be the closure and the loss of those facilities. This comes down to a judgment as to whether we think the UK is capable of having a successful, profitable and investable private sector industry.
It is the Government’s view that it is possible for the UK to have that, not least when we compare ourselves with similar advanced economies in Europe—we are not necessarily comparing ourselves with low-cost economies around the world—but it is a matter of ensuring that we have the right business environment to enable that to happen, and it is clearly incumbent on Government to arrange policy in that way. I think our steel strategy, in particular, and our trade measures provide that response, which is what gives us confidence that we have the resources to do that.
Chris McDonald
If the hon. Gentleman does not mind, I will take the second intervention from my hon. Friend the Member for Rotherham, and then I will give way to him.
Sarah Champion
The Minister is being very generous with his time. I want to take him back to the issue of Speciality Steel, because this is not just about the business itself—it is also about the supply chain. For example, the steel that is made in my constituency goes into Formula 1 cars and almost every plane in the sky. I think many hon. Members need to understand the consequential impact of saving not only British Steel, but all of our steel industry, on our whole economy and on global industries.
Chris McDonald
The supply chain is incredibly important. My hon. Friend is right about the jobs and the economic value in the supply chain; my hon. Friend the Member for Newton Aycliffe and Spennymoor (Alan Strickland) also referenced the supply chain, and particularly how its needs relate to the measures in the Bill.
A number of the proposed amendments to the Bill would ultimately slow down the ability of the Secretary of State to make decisions—that point was also made by the hon. Member for Boston and Skegness. If the Secretary of State cannot act swiftly, there is a risk of greater uncertainty among employees and commercial partners in the supply chain, as my hon. Friend the Member for Newton Aycliffe and Spennymoor rightly said. That can have real-world consequences for businesses that rely on trade finance or other forms of working capital support, as a lack of confidence can rapidly turn into business closures. While some of those amendments are well-meaning—I am speaking particularly about amendments 2, 3, 18 and 19—they would fundamentally interfere with the speed and operational ability of the Secretary of State under the legislation and reduce legal certainty.
Sir Ashley Fox
Does the Minister believe that the Government’s current energy strategy is consistent with a successful British steel industry, or does he envisage that energy strategy having to change in order to lower industrial electricity prices?
Chris McDonald
I am pleased that the hon. Gentleman has raised that question, because it was mentioned by a number of Members during the debate. To go back to the point about having a business environment that creates a profitable and investable steel industry, energy is clearly part of that. Some of the changes that the Government have already made—increasing the rebate on the supercharger from 60% to 90%, or the British industrial competitiveness scheme, which will support some of the downstream industry—will be particularly helpful in supporting not only the steel industry but other parts of heavy industry between now and 2030, which is when the Government’s clean power mission will come fully online. We anticipate that at that point, we will have not only clean energy, but secure and lower-cost energy.
If we consider the timescale of some of the investments in steel companies that we are talking about—not only multiple-year investments in order to commission, but multiple-decade investments beyond that—we can see that we have a pathway on energy that will enable us to get from now to 2030 and beyond. The Father of the House, the right hon. Member for Gainsborough (Sir Edward Leigh), who is not currently in his place, was concerned about this issue as well. He was also concerned that the UK has the highest energy prices in Europe, but we do not currently, and it is certainly our plan to ensure that our energy prices for industry are competitive with Europe in future.
Returning to the amendments that have been tabled, there was quite a lot of discussion about the sunset clause in the Bill. There were a number of objections to it, but the case for its continuation was made extremely well by my hon. Friend the Member for Middlesbrough South and East Cleveland (Luke Myer). As it stands today, the Government have no intention of extending the sunset period, but we recognise that we are living through particularly volatile times. There is geopolitical and economic uncertainty, which is likely to have a bearing on the steel sector in ways that it is difficult for us to see at the moment. As such, our view is that it is simply pragmatic to include this level of flexibility in the Bill, and of course, regulations made under that clause would be subject to the affirmative procedure.
It is important that I address some of the concerns of the hon. Member for Caerfyrddin (Ann Davies), who spoke with great passion and commitment about the importance of the steel industry throughout the whole of Wales. There is often considerable discussion of Port Talbot in this House, but as she rightly set out, there are also steelworks in Llanwern, Cardiff, Newport, Trostre and Shotton—I hope I have remembered all of them—that deserve recognition and investment.
I could not disagree more, however, that this Government have treated the Welsh steel industry unfairly, or not in an equitable way, compared with the steel industry elsewhere in the UK. The steel industry in Wales is the only part of the industry that has a ringfenced fund—£500 million for Port Talbot. The hon. Lady said that that has been spent with no benefit to the local community, but I frankly cannot agree with that. That £500 million has enabled Port Talbot to invest an additional £500 million in a transformation of that steelworks that will secure steel production at that site and the future of the south Wales steel industry for decades to come. It is a significant investment in the local community.
I know that the hon. Lady, like me, would have preferred for that transition in south Wales to have happened without the hard stop between the closure of the blast furnaces and the restart of the electric arc furnace, and I support Tata Steel’s view on the installation of its electric arc furnace. However, the decision to close was taken before the general election, and my right hon. Friend the Member for Stalybridge and Hyde (Jonathan Reynolds)—the former Secretary of State, who is now Chief Whip—was able to intervene at that point and get a much better deal for the workers at Port Talbot and the community there than the previous Government did. I share the hon. Lady’s frustration and concern, but we need to be clear about where the indifference to the blast furnace closures in Port Talbot was. It was not with this Government; it was with the then Conservative Government.
Richard Tice
As we are talking about the new electric arc furnace in Port Talbot, can the Minister guarantee with certainty his confidence that, when built, it will open?
Chris McDonald
I am really glad that the hon. Gentleman has asked me that question—I know he has great experience in the property industry, and certainly with construction projects. As I mentioned earlier in the debate and as he will know very well, in any construction project you only really have certainty on the timeline when you have got out of the ground, and this project is still very much in the ground.
The hon. Gentleman’s question gives me the opportunity to clear up some issues. I know that the delay as reported by Tata Steel—this is Tata Steel’s project, not the Government’s—related to an electrical connection, and specifically the soil condition as it relates to building a substation. At the outset, quite rightly, assumptions were made about the soil condition based on engineering assessments. Right hon. and hon. Members must be aware, though, that there have been steelmaking activities on that site in Port Talbot for well over 100 years. Not all of those operations had been fully documented, and the ground conditions were considerably worse than had been anticipated. That is now being dealt with, and as soon as the project gets out of the ground, we will have great certainty about when the electric arc furnace can turn on. Until that happens, as a project manager, I would hesitate to give a cast-iron guarantee, because you need to get out of the ground first.
What I am looking forward to, though, is the delivery of the electric arc furnace in Port Talbot, because that is the point when the project will feel real—when the workforce will be able to see the furnace itself. I have been around the shop and seen the space that has been created for the installation of the furnace, but once it arrives on the dock of Port Talbot, we will all feel a greater degree of certainty about that. That will be a big boost to the workforce when it does happen. I am absolutely confident that it will happen, but to say when—to pin it down to an individual week or month—is more difficult.
There was one more point I wanted to make about the contribution of the hon. Member for Caerfyrddin. She essentially called for public ownership of Port Talbot, and I am really sorry, but that is another point on which we disagree.
The Government’s view is that where a steel undertaking is running adequately under private ownership, that ultimately should be allowed to continue, because the Government believe in private involvement in the steel sector. It goes back to the point about investment that I think the shadow Minister made earlier. She described her concern about a potential chilling effect on investment.
Mr Alex Barros-Curtis (Cardiff West) (Lab)
I am grateful to the Minister for putting on the record this Labour Government’s record on Welsh steel, because it contrasts with the 14 years of ruin under the Tory Government. Their failure to have an industrial strategy caused decisions to be taken in Port Talbot before this Government came into power. The Tories do not like to be reminded of that, but we will remind them about it every time. It is something that Plaid Cymru—I have great respect for the hon. Member for Caerfyrddin (Ann Davies)—and Reform would do well to remember when they turn up for their photo op outside Port Talbot.
I want to touch on something that my constituents are grateful for, which is this Government’s steel strategy. As the Minister rightly says, that resulted in a £100 million investment by Sev.en in 7 Steel in Cardiff. Does he agree that that is not only a sign of the importance of the steel strategy, but will mean that at least half of future UK steelmaking will be Welsh steel? All Members in the House should welcome that.
Chris McDonald
I thank my hon. Friend for making that point. He is right that we should welcome that 50% of UK steel will be made in Wales. We talk about Port Talbot specifically, but 7 Steel’s plant has operated incredibly well for so long, making the rebar steels that are essential for our construction industry in the United Kingdom, as well as in Ireland, which 7 Steel supplies, too. Long may that continue. I am sure that the investment will help with that.
The right hon. and learned Member for Kenilworth and Southam (Sir Jeremy Wright) raised a number of concerns, such as the operation of the Bill, its powers, public money and so on. He made a comparison with the Banking Act 2009, and he is right that I have made great play about the similarity between this Bill and that Act. I reassure Members that, having passed the Banking Act to great acclaim, this Bill is following its path, and we made a positive decision to do that.
The right hon. and learned Gentleman mentioned the requirement in the Banking Act for the Chancellor of the Exchequer, I believe, to consult with the Prudential Regulatory Authority, the Financial Conduct Authority and the Bank of England, and how a consultation requirement is not in the Bill. He is right to point that out, but these are different industries. The banking industry is highly regulated, and there are statutory bodies that require consultation. There is no opportunity to replicate that in the steel sector, because there are no such statutory bodies. He rightly made the point that it is important that we engage on the detail in Committee, and I thank him for raising that point and giving me the opportunity to respond.
Jim Shannon
The Minister quickly and helpfully responded to my earlier intervention, and he will be well aware of the economic position of Northern Ireland due to the Windsor framework. Should the Bill go forward, the Government must provide a cast-iron guarantee that the nationalisation and supply chain structures outlined in this Bill will operate seamlessly. Can he give us a guarantee that that will happen and that Northern Ireland will not be disadvantaged by any new tariffs or tariffs that are already in place?
Chris McDonald
From the Government’s perspective, there is certainly no intention to disadvantage Northern Ireland. The unique position that Northern Ireland holds is enabling it to attract additional investment above and beyond. In fact, the economic growth rate in Northern Ireland is incredibly impressive, and I look forward to seeing that when I visit in two or three weeks’ time.
Having addressed the amendments, I will move on to some of the new clauses. First, I acknowledge the incredibly constructive dialogue I have had with the hon. Member for Richmond Park (Sarah Olney) in preparing for the Bill and the tabling of her amendments. New clause 2 would place a requirement on the Secretary of State to consult an advisory committee as part of his decision-making process. The Government agree with the sentiment—we have had wide consultation with stakeholders—but there is a practical reality and in particular a commercial consideration for the exercise of the Bill’s powers. It is therefore not possible for us to accept that new clause.
New clause 3 relates to the detail of a jobs and industrial transition strategy, which my hon. Friend the Member for Newton Aycliffe and Spennymoor asked a specific question about. I reassure Parliament that from a skills perspective, the Government will assess any impacts of a transfer on jobs, skills and local communities. In fact, that is an incredibly important part of why we would seek to intervene at all. Following an acquisition, the company’s objectives will be published as part of the shareholder framework document.
Finally, I will move on to new clause 5. Again, this issue was mentioned by my hon. Friend the Member for Newton Aycliffe and Spennymoor, and it also comes back to where I started the discussion about the nature of a nationalisation. While the Government in this situation would own a steel undertaking, and as the main shareholder in the business would have the opportunity to set the direction and appropriate strategic objectives, it is not the Government’s aim that the steel companies would then become an extension of the civil service, as amazing as my civil servants are. Instead, steel undertakings should be run by those who are knowledgeable and skilled in the industry, as we have seen at Sheffield Forgemasters and, as we heard, at the semiconductor factory at Octric.
Having covered the amendments and the new clauses, and perhaps tried the patience of the Committee to a great extent, it would be wise to conclude. I point out to hon. and right hon. Members that there is an additional day of debate on the Floor of the House on this Bill tomorrow. Rather than me standing here and talking to myself for six hours, they would be most welcome to come back then. If I have addressed their points sufficiently, perhaps some of those who have tabled amendments may see fit not to press them to Divisions, but otherwise, I feel I have addressed the points sufficiently for now.
The Chairman of Ways and Means (Ms Nusrat Ghani)
I call the shadow Minister.
Dame Harriett Baldwin
It is wonderful to see so many people interested in following this debate until 10 pm, which when our scrutiny of the Bill ends today. I will make just a few remarks, if I may. Despite the fact that we still have another day tomorrow, there were a few things in today’s debate that I have not heard sufficiently answered.
First, I pay tribute to the wise remarks from my right hon. and learned Friend the Member for Kenilworth and Southam (Sir Jeremy Wright). I encourage the Minister to take on board his points about the wide scope of the powers the Minister is taking in this legislation. My right hon. and learned Friend is a former Attorney General, so his remarks should be heeded with a great deal of seriousness. I reiterate the questions from my right hon. Friend the Member for Gainsborough (Sir Edward Leigh) and my hon. Friend the Member for Brigg and Immingham (Martin Vickers), who sought assurances that the blast furnaces will continue. I am not sure we heard that on the record. When the Minister next gets to the Dispatch Box in these days of debate, will he clarify his intentions as far as that is concerned?
Will the Minister provide clarity on the public interest test? Sensible remarks were made about the Regulatory Reform Committee and how the public interest test is too broadly defined. How can it ever be reversed once it has been invoked? I did not hear anything about limiting the contingent liabilities or the sunset clause, or the possible impact—mentioned in the impact report itself—on investor confidence in this country.
The Minister mentioned that he was willing to meet Members who have concerns about the steel tariffs, which are a separate issue. May I urge him, over the next 24 hours, to try to find some time in his diary so that they can raise specific examples with him?
Charlie Maynard (Witney) (LD)
On 21 May, the Business and Trade Committee met representatives of more than 20 steel fabrication companies who were deeply worried about the potential loss of hundreds, or thousands, of jobs. I second that, in respect of the urgency, because 1 July is around the corner, and this represents a major risk to the sector.
Dame Harriett Baldwin
Indeed; and, as we have heard, one of the suppliers is still in administration. I think that the Minister needs to rethink that deadline, and I hope he will find time in his diary, perhaps as early as tomorrow, to meet Members on both sides of the House to discuss the issue.
With no more ado, Ms Ghani, I will now attempt to press as many of the amendments as you will allow, and we will test the view of the Committee. However, I beg to ask leave to withdraw amendment 21.
Amendment, by leave, withdrawn.
Clauses 1 and 2 ordered to stand part of the Bill.
Clause 3
Sunset for exercise of principal transfer powers
Amendment proposed: 12, in clause 3, page 2, line 10, leave out subsections (3) to (5).—(Dame Harriett Baldwin.)
This amendment would prevent the Secretary of State extending the sunset of the principal transfer powers.
Question put, That the amendment be made.
The First Deputy Chairman of Ways and Means (Judith Cummins)
It has been drawn to my attention by the Tellers that the numbers were incorrectly reported for the Division on the Question that amendment 12 be made. The correct numbers were 81 for the Ayes and 266 for the Noes. I will direct that the numbers be corrected in the Journal.
The occupant of the Chair left the Chair (Programme Order, 21 May).
The Deputy Speaker resumed the Chair.
Progress reported; Committee to sit again tomorrow.
Business without Debate
Maternity Nurses, Nannies and the Infant Sleep Industry
(1 day, 5 hours ago)
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Mr Connor Rand (Altrincham and Sale West) (Lab)
Being a parent is the one of the greatest joys we can have in life, but let me be clear, it is also one of the hardest things we ever do. I remember the first year of my son’s life and the happiness those precious early moments brought me and my partner, but I also remember the less precious moments, with the daily battle every new parent has with their own anxieties as they ask themselves, “Why are they crying? Why are not they sleeping? Am I doing something wrong?” Those questions swirl around our heads at a time when we are sleep deprived, emotionally drained and totally unsure of ourselves—in other words, we are vulnerable.
What do we do in that situation? We seek out help, expertise and people we think we can trust. In the majority of circumstances, that is absolutely the right thing to do—health visitors and the vast majority of nannies who provide responsible care give parents vital support that helps them get by—but what if, when we turned for help, the person who responded was not someone we could trust? What if they were not the expert they claimed or seemed to be? What if they had no qualifications, no training and no accountability? When that happens, we run the risk of unimaginable tragedy.
Jim Shannon (Strangford) (DUP)
I commend the hon. Gentleman for bringing forward this really good debate; I spoke to him about it last week. He will be aware that, as it stands today across the United Kingdom of Great Britain and Northern Ireland, anyone can buy a website domain, call themselves an infant sleep expert or a maternity nurse and charge vulnerable, sleep-deprived parents hundreds of pounds for unregulated, untested and potentially unsafe advice. Does he agree that sleep-deprived and vulnerable parents need to have security that the advice they are taking comes from a solid foundation, and that qualifications—or lack of qualifications—must be clear when advice is offered?
Mr Rand
I thank the hon. Member. The vulnerability that parents feel in that moment is one of the reasons why it is so important that we ensure adequate regulation in this area. At the moment, we run the risk of unimaginable tragedies day after day, and it is happening more and more as the support we used to provide for new parents has shrunk. In the gaps that has created, the infant sleep industry has boomed. The industry is currently a wild west where, as the hon. Member said, anyone can pose as an expert and give parents advice that puts their child’s life at risk. Sometimes, these people call themselves maternity nurses, practitioners or consultants. Sometimes they call themselves sleep trainers or specialists. Sometimes they provide care in the home. Sometimes they share their advice to vast and growing audiences on social media. In all cases, there is no requirement for them to have any medical training or qualifications to justify their title. In addition, there is also no legal accountability for advice provided and no recognised standard for support provided.
Chris Vince (Harlow) (Lab/Co-op)
As a new parent, this is hugely concerning to me and not something I was particularly aware of. Does my hon. Friend have any advice for new parents looking for support about what questions they should ask to ensure they are talking to experts and not so-called experts who, as the hon. Member for Strangford (Jim Shannon) said, are people without any qualifications at all?
Mr Rand
Yes, I will come to some of that. Whether parents are following advice or performing these duties themselves, it is important that they think about safe sleeping extremely seriously—that is what any parent should be doing. It is very important indeed to understand the qualifications and medical expertise of those providing advice.
In May, the BBC used undercover filming to expose two prominent figures in the infant sleep industry who were openly giving parents advice on safe sleep that could result in the death of their children. That is not just my opinion; the NHS clinicians who observed the BBC’s footage said that it was “horrifying”.
Mr Morrison
I thank the hon. Member very much for getting this debate on the Floor. He references the BBC investigation, and the things that were put out on that were absolutely horrifying. Talking of experts, the Lullaby Trust is a huge leader, particularly around safer sleeping. I was horrified by the lack of regulation—the wild west, as he describes it—so would he agree that we need a proper, legal, regulatory framework to make sure that these charlatans who are putting this bogus safe sleep advice out there on social media and other channels are held to account, and to ensure that parents and their children are protected from these groups of people?
Mr Rand
Yes, I completely agree. I know that the hon. Member has worked with the Lullaby Trust, and I am grateful to have met its representatives myself and to have had their input into my campaign on regulation in this area. Of course, the Government have already begun to set out—quite rightly, after his campaigning work—the approach we need to take forward in early years settings, but it is critical that the whole sector, including advice provided in the home, should have a sustainable legal framework.
The figures who were exposed by the BBC in their undercover filming have thousands of followers online and have published widely bought books. To any parent, they would ostensibly look like an expert. That such unqualified people can operate in that way without any oversight at all is terrifying. How can it be right that an industry dedicated to the care of babies is totally unregulated? We know the answer to that. It is not right and it must change, because without change, more children will die. I do not say that lightly; I say it because of what happened in my constituency.
Two years ago, a four-month-old baby from Trafford died after being placed in an unsafe sleeping position on the advice of a maternity nurse who had no medical qualifications at all. There was no legal accountability for this death because no laws had been broken, but a family had been broken. I cannot begin to imagine what the parents of that child have been through. There are no words to describe it, and I will not try to do so, but what I will try to do is ensure that change is the legacy of their tragedy. It is not just me that is calling for change. The senior coroner who worked on the case issued a prevention of future deaths order to the Secretary of State and, in doing so, called on infant sleep services to be urgently regulated.
What does this change look like? I have three main asks of the Government and the Minister today. First, will the Minister explore the introduction of mandatory minimum safeguarding training and qualification standards in the baby sleep industry and the nanny industry, as has been called for by the National Nanny Association, the Lullaby Trust and other organisations. I am sure that we can all agree on the reason to do this—namely, that people looking after children should have basic medical and early years training, including on safe sleep. This change could introduce standards and safeguards to an industry badly lacking in both.
This change would support the majority of people who provide responsible, home-based care for children while cracking down on the dangerous minority who do not. It would give parents peace of mind and minimum legal standards to hold providers against, and the introduction of mandatory training and standards could lead to the development of a national regulated framework or register for all those providing home-based childcare. With a register, we would strengthen safeguarding, give parents clarity and professionalise the sector.
My second ask is that we need stronger legal protections for the title of “nurse”, and in response to the tragedy in my constituency, the Government announced that they would protect the title of “nurse” so that it could be used only by someone with appropriate medical qualifications. That is a really important step forward that I very much welcome. However, people in the infant sleep industry are also calling themselves “practitioners” and “consultants”, so I urge the Government to explore legal protections for those titles too, because, like “nurse”, they imply a level of expertise that is often not there and that parents might rely on. When announcing that the Government would protect the title of nurse, the then Secretary of State committed to seeking wide input on the proposals to get them right. I appreciate that there have been changes since, but can the Minister update me on that work and set out a timeline for when we can expect action?
My third and final ask relates to the context in which the infant sleep industry has boomed. As I mentioned earlier, this is a sector to which parents are increasingly turning as the support that used to be provided by the state has been stripped back. The number of health visitors has almost halved in the last decade, and home visits are not happening consistently across the country, as overstretched staff battle caseloads of up to 1,000 families. That is the vacuum that causes parents to walk into the wild west of dangers. I would appreciate the Minister setting out the Government’s plan to invest in health visitors and infant care, so that we can protect children and their parents with the highest-quality support possible in our national health service.
Robbie Moore (Keighley and Ilkley) (Con)
I commend the hon. Gentleman’s excellent speech, particularly the three points that he has just made, with which I absolutely agree. I put on record my thanks to Maria Culley from the National Nanny Association, who has been working tirelessly on this issue, and who is a constituent of mine. I have met Children and Families Ministers under this Administration and previous Administrations and not managed to get too much traction, so I absolutely back everything that the hon. Gentleman is asking for.
Does the hon. Gentleman agree that it is not only sleeping tutors and maternity nurses but nannies who are completely unregulated? We need Disclosure and Barring Service checks, a compulsory national register for nannies, and the minimum training standards that he is calling for. Finally, I would be over the moon to work with him to ensure that we can get those asks on the statute book.
Mr Rand
I appreciate the hon. Member’s support. We owe it to people who are working in the industry and behaving responsibly to ensure that those standards are in place right across the industry.
This Government are already doing vital work on safe sleeping. Safe sleep guidance in nurseries is set to become statutory, and Ofsted will now assess safe sleep practices during its inspections of early years settings. I pay tribute to the Campaign for Gigi, the Lullaby Trust and the hon. Member for Cheadle (Mr Morrison) for their role in securing these truly transformative steps. The Government must build on that progress. If we accept the urgent need for safe-sleep protections in early years settings, why would we not apply the same standards to care that is provided in people’s homes? This is about safety, accountability and support for every parent.
Of all the contributions that I have made in this place so far, this is the one I feel most strongly about. I know from experience the difficulty of being a new parent, and how vulnerable we are in that time of stress, fear and confusion. It is truly chilling that this vulnerability, combined with the desire we all have to do the best for our children, can lead us to seek support from those not fit to give it. But that is what is happening, and we have a responsibility to do something about that.
I hope that today can be the start of that journey. I look forward to meeting and working with Minister, the charities working on this issue, and all those across the House who want to see real progress to develop the solutions we need to protect children and their parents from unimaginable tragedy.
The Minister for Secondary Care (Karin Smyth)
I thank my hon. Friend the Member for Altrincham and Sale West (Mr Rand) for securing this debate and acknowledging the concern that has been raised recently in the field and by the media. We are all deeply saddened to see the impact of those giving poor advice on infant sleeping. Public safety is and has to remain the top priority.
As my hon. Friend said, being a new parent is a difficult time; I certainly recognise that helping an infant settle into a regular sleep pattern can be difficult for new parents and carers. It is a worrying and stressful time, as he said. Rogue advice from so-called experts can have a devastating effect on those who seek reputable advice and guidance.
Before I talk about regulation of the infant sleep industry, I want to clarify that the Department for Education is responsible for the regulation of nannies and childcare services, which my hon. Friend mentioned. The early years foundation stage statutory framework sets the standards and requirements that early years providers must meet to ensure that children have the best start in life and are kept healthy and safe. All early years providers are already required to meet the safer sleep requirements set out in the statutory framework, which currently links to the NHS safer sleep guidance. The Department for Education plans to update the wording in the early years foundation stage statutory framework so that the requirements are set out directly in the framework itself. That is due to come into effect from September 2026, subject to the usual parliamentary and legislative processes. The Department for Education has already written to providers informing them of the proposed new wording and to remind them that they must meet the current requirements.
The “Best Start in Life” campaign provides parents and carers with NHS safer sleep advice through a range of communication channels, including social media, the website and an email programme. Recently, we have collaborated with experts such as Rosey Davidson, a paediatric sleep consultant, to support the promotion of safer-sleep guidance, reaching approximately 40,000 parents through one post alone. The healthy babies programme supports new parents and families by offering integrated, preventive and universal support, including for perinatal mental health, parent-infant relationships and infant feeding, in the 1,001 days from pregnancy to age two. By delivering those services through a physical and digital Best Start family hubs network, we are ensuring that parents and carers have access to joined-up, family-centred advice and support that is delivered in communities where there are high levels of need.
In January, NHS England published a post-natal toolkit to improve the post-natal care experience for women and their families. The toolkit supports integrated care boards, their place-based partners, and health and care providers to work together with service users and professionals to improve the post-natal care experience and both short-term and long-term maternal and infant health outcomes. Additionally, NHS England has published guidance for GPs on the post-natal appointment that women should be offered six weeks to eight weeks after giving birth. That provides an important opportunity for GPs to listen to women in a discreet, supportive environment.
Qualified health visitors and their teams also have an important role, as my hon. Friend said, in supporting infant health, wellbeing and parenting confidence. They promote safe sleeping for babies and provide safe advice to parents. Services such as health visiting are being strengthened by providing over £13.4 billion of public health funding for local government over the three years from 2026/27 through a consolidated ringfenced public health grant.
“Maternity nurse”, “night nurse”, “baby sleep consultant” or other terms for these roles are not regulated professions. Often, those working in a sleep industry role will refer to themselves as a “nurse” to indicate that they are suitably qualified to advise. That can mislead the public by providing an impression that such individuals are qualified and professionally registered to provide a particular level of care, advice or care intervention that they do not hold, which puts the public and babies at risk.
In May 2025, the Government announced our intention to protect the professional title “nurse” within this Parliament. Protecting the title “nurse” will make it a criminal offence for someone to call themselves a nurse unless they are registered as a nurse with the Nursing and Midwifery Council, or part of one of a number of exempt professions, such as dental nurses and veterinary nurses. These new protections will also apply to longer professional titles that include the word “nurse”, such as “maternity nurse” and “night nurse”. To ensure that we get these changes right, we will shortly be publishing a call for evidence on the protection of the title of “nurse”.
I invite everyone present and those interested in this debate to share their views, which will inform the future legislation underpinning the Nursing and Midwifery Council that will implement this change. We want to hear from those working in healthcare, but also those in other fields such as childcare and care for animals as well as the general public, to understand what exemptions should apply and to ensure that those who may be affected by this change can feed in their concerns. We are also seeking views on protecting other titles such as “nursing” and “health visitor”.
However, ultimately this is about patient and public safety. When someone seeks treatment, support or advice from a “nurse”, there is a legitimate expectation that the individual is suitably qualified and professionally registered. Our proposed changes will make it a criminal offence for someone who does not hold such qualifications and professional registration to claim to be a nurse.
This is an important subject and I am grateful to my hon. Friend for raising it, and I know there is further interest across the House. I hope people will respond to the call for evidence, and we will of course continue to work with colleagues to make sure this is a safe place for parents.
Question put and agreed to.
Draft REACH (Amendment) (No. 2) Regulations 2026
(1 day, 5 hours ago)
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The Chair
Good afternoon, ladies and gentlemen. Hon. Members may remove their jackets, if they are brave enough to do so.
The Parliamentary Under-Secretary of State for Environment, Food and Rural Affairs (Emma Hardy)
I beg to move,
That the Committee has considered the draft REACH (Amendment) (No. 2) Regulations 2026.
I am delighted to serve under your chairmanship, Sir Roger, and I welcome all hon. Members to the Committee. The draft regulations were laid before this House on 24 March. I will go through them in detail, but in short, all they will do is move six dates to enable us to finish the alternative transitional registration model; amend UK REACH, which is a central part of the framework governing the safe use of chemicals in Great Britain; and amend the dates by which businesses must submit information to the Health and Safety Executive on chemicals that they manufacture and place on the market.
UK REACH retains the core principles of the EU system, including its fundamental aim of ensuring a high level of protection for human health and the environment. I want to be clear from the outset that nothing in these draft regulations will change its aims or reduce its protections; they will just move six dates and make two key changes.
The first change will extend the deadline from article 127P by which registrants—that is, manufacturers and importers—must submit information on their chemicals to the HSE. Our EU exit transitional arrangements were put in place to support a smooth and orderly move to the UK regime, including later deadlines to submit complete registration data. Under the current system, the deadlines fall on 27 October 2026, 27 October 2028 and 27 October 2030. The most hazardous and highest-tonnage substances come first. The draft regulations will extend those deadlines to 27 October 2029, 27 October 2030 and 27 October 2031 respectively. These provisions apply to all substances that were already on the EU market at the time of EU exit.
I recognise that these deadlines have previously been extended, so let me address directly why we need to extend them further. In 2023, the then Government extended the deadlines because of transitional challenges, especially the considerable cost to the industry of acquiring the information required, usually from former EU partners. This allowed for the exploration of an alternative transitional registration model. The aim was a fair and workable system for all stakeholders. Since the election, this Government have reassessed our broader chemicals policy while we have completed exploration of the ATRm. This reflects our improved relationship with the European Union, but clearly the ATRm cannot be implemented in time for the first transitional registration deadline of 27 October 2026. As a result, it is necessary to extend the deadlines once more to ensure a robust and effective policy framework. This extension will avoid imposing significant and unnecessary costs on industry while we complete the development of a more proportionate and effective transitional model.
Following a consultation in 2024, we published our approach to the ATRm on 30 March 2026, providing long-awaited clarity for industry. It will reduce the data that businesses must submit for UK REACH registration. The ATRm aims to cut by about 70% the one-off industry costs of transitional registration, but it also maintains the important protections that UK REACH provides. It recognises that companies that place chemicals on the GB market are responsible for managing the risks to human health and the environment, including harmful effects arising from their hazardous properties or how they are used in this country. Registration therefore remains key to ensuring that businesses understand and properly manage those risks in Great Britain.
The extension of the deadline is to give us the extra time needed to finalise and implement the ATRm in a proportionate and workable way in the GB market. It will also give businesses the certainty that they need to plan for compliance, and will maintain continuity in important supply chains.
We are acting decisively by bringing forward ATRm legislation so that the industry knows what it needs to do in good time for the new deadlines. Without the extension, businesses would have to meet the existing deadlines and submit the full registration requirements currently in UK REACH. The industry would face the full estimated £2 billion costs, when we have made clear this Government’s intention to remove them. I believe that that would be as unacceptable to this Committee as it is to the Government.
The second change in the draft regulations is to the deadlines by which HSE must complete compliance checks on 20% of registration dossiers. The compliance check deadlines will thereby remain aligned with the revised registration submission deadlines; otherwise, HSE will have to complete checks before the relevant data is even submitted. Under the draft regulations, the deadlines for compliance checks will move to 27 October 2030, 27 October 2032 and 27 October 2036—I should have asked why 27 October, shouldn’t I? That will remain a mystery, but the time between the registration deadline and the related compliance checks deadline will remain unchanged.
As with the previous amendment to UK REACH, made using a power in the Environment Act 2021, we have followed the safeguards set out in schedule 21 to that Act. We have worked closely with the devolved Governments in Scotland and Wales, who have given their consent for this instrument. We have consulted publicly to ensure that stakeholders have had the opportunity to provide views and evidence.
We have published a statement confirming that the amendments are consistent with the overarching aims of UK REACH. We have also published an impact assessment, which demonstrates that extending the deadline will reduce unnecessary costs to businesses while maintaining an effective regulatory framework; it builds on the options assessment published in March 2026, which the Regulatory Policy Committee rated as fit for purpose.
The territorial extent of the draft regulations is the United Kingdom. The devolved Governments are engaged in their development and are content. The Joint Committee on Statutory Instruments has formally considered them without comment.
The draft regulations will ensure that UK REACH continues to operate effectively during the transition to a more proportionate registration model. They will maintain high standards of protection for human health and the environment while giving industry the time and certainty to comply in a way that avoids unnecessary cost and disruption.
Robbie Moore (Keighley and Ilkley) (Con)
The draft regulations will extend the current legislative deadlines for registration to submit information to the Health and Safety Executive under UK REACH. They will also extend the period during which downstream users and distributors who were importing from the EU before the end of the EU exit implementation period can continue to import chemicals from the EU without submitting a full registration. The official Opposition support this measure, because ultimately it seeks to serve businesses and save them money by extending deadlines.
The deadlines have already been extended twice, both times by the previous Administration: first in 2020, then in 2023. The Opposition agree that extending the deadlines further via the draft regulations will provide sufficient time for the Government to develop and introduce a new transitional registration model to cover registrations of substances that were already on the EU market at the time of EU exit. This approach aims to reduce industry costs significantly.
We welcome the findings of the impact assessment, which concludes:
“This policy is not expected to negatively affect businesses of any size.”
It also notes that the cost savings from discounted terms could benefit small and micro businesses “less proportionately” than larger businesses, and that this is
“due to shorter extensions linked to later deadlines for smaller tonnages.”
Of the 3,195 registered businesses in the chemical sector, 3,125—some 98%—are small, medium-sized and micro businesses, as the impact assessment outlines.
Although we support the draft regulations, I acknowledge that there has been some third-party concern about the impact of the proposed changes and the risk of divergence from the EU in this policy area, as noted by Wildlife and Countryside Link, which stated its concerns in a formal submission to the House of Lords Secondary Legislation Scrutiny Committee. I hope that the Minister can assure those organisations that have concerns that divergence from EU regulations will occur only when there is a convincing and compelling case for it, and not simply for its own sake. We will support this delegated legislation.
Andrew Cooper (Mid Cheshire) (Lab)
It is a pleasure to serve under your chairmanship, Sir Roger. I will endeavour not to detain hon. Members longer than is necessary.
I thank the Minister for her opening remarks and for clearly making the case for extending the submission deadline for chemicals registered for EU REACH. I agree that allowing more time for Government and industry to get this right strikes the right balance, particularly given that the vast majority of substances were previously registered under EU REACH and have established and well-understood risk management measures in place.
As the Minister will undoubtedly be aware, Mid Cheshire is arguably the birthplace of the UK chemicals industry. Brunner, Mond and Company was established in Northwich in 1873 and was one of the four main companies that merged to create ICI. It was in Northwich that polyethylene was discovered, and the chemicals we produce today at Lostock works are critical to maintaining our clean water supply.
The chemicals industry has welcomed the recent support from the Chancellor in the form of the £350 million critical chemicals resilience fund. Nevertheless, a £2.5 billion regulatory burden was created by the previous Government’s chaotic departure from the European Union and consequently from the EU REACH scheme. That needs to be addressed. My constituents voted to leave the EU, but I sincerely doubt that a single one of them did so because they yearned to be free of the yoke of European chemical hazard registration requirements. Turning to her husband on 24 June 2016, Mrs Trellis of Winsford did not say, “Finally, Brian, our great country can now diverge from the EU on registration and management of the risk of hazardous chemicals.” But leave we did, and that decision has had consequences for companies in my constituency.
Last year, I visited Indaver, a company with a site in Middlewich that specialises in the recycling of chemicals. A key issue that it has raised involves the registration requirements for chemicals after they have been recycled. Prior to Brexit, when a chemical or molecule was registered under REACH in the EU, recycling processes would not trigger the need for re-registration. This assumed that the chemical’s identity and structure remained unchanged during recycling, allowing the same registration to be used for both the original and the recycled material. Post Brexit, even if the molecular structure of recycled chemicals remains unchanged, UK companies are required to re-register those chemicals with the EU REACH scheme before they can sell or distribute them within the EU market.
In contrast, EU-based companies continue to operate under the previous system, under which re-registration of recycled chemicals is not required. The clear regulatory disparity that has been created is not only time-consuming, but costly, as it involves new testing, documentation and potentially lengthy approval timelines. For Indaver, this means that recycled chemicals must undergo the same rigorous procedures as new chemicals, despite no changes having been made to their chemical composition. These added costs and administrative burdens place UK businesses at a significant competitive disadvantage, especially in comparison with their EU counterparts that can bypass the process.
I know that the Minister’s Department continues to work to develop UK REACH, and I recognise that this is the situation that she has inherited and that she has a responsibility to make the system work. However, I ask her to consider whether, given the importance of regulatory alignment between EU REACH and UK REACH, mutual recognition of these schemes can be made a priority as part of future negotiations over our relationship with the EU. Ensuring consistency and mutual recognition of registrations would not only support local businesses, but foster fair competition and facilitate smoother trade between the UK and the EU.
Tessa Munt (Wells and Mendip Hills) (LD)
The Liberal Democrats support the principle of reducing unnecessary bureaucracy and avoiding costly duplication for businesses in the UK REACH regime. We recognise the challenges that businesses face in complying with post-Brexit chemicals regulations, and we understand the need to develop a more proportionate and workable registration system.
The draft regulations will provide businesses with additional time to compile and submit complex chemical safety information while the Government develop their alternative transitional registration model. Given the significant costs and administrative burdens that the current system can impose on businesses, we support measures that avoid unnecessary regulatory burdens while maintaining existing environmental and public health protections. We will therefore support the draft regulations, but we urge the Government to move more quickly to deliver their replacement registration model and provide long-term certainty for businesses, regulators and consumers.
The Chair
I do apologise; I was under the impression that the hon. Lady was speaking from the Back Bench, but I take it from her opening remark that she was speaking for the Liberal Democrats.
The Chair
Had I known, I would have done the hon. Lady the courtesy of calling her to speak as a Front Bencher.
Emma Hardy
I thank all Committee members for their support and their contributions. UK REACH is a complex but important framework that underpins how we regulate chemicals to protect human health and the environment while supporting industry and trade.
My hon. Friend the Member for Mid Cheshire made an important point about the chemicals industry. Recent events have highlighted the importance of the chemicals industry and how essential it is to everything in the United Kingdom, including water. That is why I was so keen to work with the industry to make things as easy for them as possible.
My hon. Friend is absolutely right that the situation that he describes is an inevitable result of leaving the EU in the way we did. My constituency also voted to leave, but at none of the doors that I knocked on did anyone say that that was because they did not like the transitional arrangement for chemicals regulation, either, although maybe somebody somewhere did. Under UK REACH, recovered substances do not need to be registered if they meet certain conditions, one of which is that recovery must take place within the EU, so my hon. Friend is completely right.
Let me quickly set out where we are trying to go. We have published a document on the new approach to ensure that regulators and regulation support the growth action plan, and in the environment improvement plan we want to make greater use of regulatory decisions made by like-minded jurisdictions, particularly the EU. To support that, we are looking to reform UK REACH so that we can apply protections that address chemical pollution more quickly and efficiently and in a way that is more aligned with our closest trading partners, especially the EU, by December 2028. We will take regulatory decisions in accordance with that reform unless there is a compelling reason to diverge—and it would have to be compelling. We will assess and, where appropriate, add substances to the authorisation list and will update the candidate list. Drawing from regulatory decision making in other jurisdictions does not change the importance of registration by GB companies, but it is a sensible way to conduct trade with our nearest and closest neighbours.
In response to the Opposition spokesperson, the hon. Member for Keighley and Ilkley, we are committed to closer alignment with EU REACH and we will ensure that divergence occurs only when it is compelling. We are currently defining the specific circumstances under which exemptions from EU alignment may be considered for UK REACH. We will publicly consult on those proposals, so I urge everybody to submit their thoughts.
The changes that we are introducing under the draft regulations are simply an amendment to the deadlines to enable that work and that public consultation to take place. They will not reduce our high levels of protection for human health, but they will make things easier for businesses. I thank everyone for their support, and I commend the draft regulations to the Committee.
Question put and agreed to.
Draft Combined Authorities (Mayoral Elections) (Amendment) Order 2026
(1 day, 5 hours ago)
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The Committee divided: - Ayes: 10 / Noes: 4 - Question accordingly agreed to.
The Parliamentary Under-Secretary of State for Housing, Communities and Local Government (Samantha Dixon)
I beg to move,
That the Committee has considered the draft Combined Authorities (Mayoral Elections) (Amendment) Order 2026.
It is a pleasure to serve under you in the Chair, Sir Desmond. The draft order was laid before the House on 21 May 2026.
Over the course of the past year, Parliament has debated, agreed and decided—through the English Devolution and Community Empowerment Act 2026, which received Royal Assent in April—that the voting system for mayors and police and crime commissioners should be changed to use the supplementary vote system. The SV system was used when the positions of elected mayor and police and crime commissioner were first established, decades ago, and the Government believe that it is the most appropriate voting system for single executive offices, where it is essential that an individual has a broad mandate from their electorate.
The English Devolution and Community Empowerment Act contains the main measures required to change the voting system used for those types of elections, and they will be commenced in due course. However, a number of other changes must be made to the election conduct rules via secondary legislation to fully enable the use of SV—for example, updating the images of ballot papers to allow a voter to select multiple preferences, and updating guidance to electors and the procedures used at the count should there be a second round of counting. We stated during passage of the English Devolution and Community Empowerment Bill that the Government’s intention was to implement the change to SV for any mayoral or PCC election taking place after the scheduled May elections this year.
The order has been drafted to be concise and so will make only the necessary additional amendments to enable SV to be used for both combined authority and combined county authority mayors, including those who exercise police and crime commissioner powers. Therefore, the order will not make amendments with regard to elections for local authority mayors, the Mayor of London or police and crime commissioners. Further legislation will be brought forward for those in due course.
The draft order will make the change to SV for any combined authority or combined county authority mayoral election for which notice is given on or after the date that the order comes into force. As this is a reversion to the original voting system used for mayoral elections, the SV process will be familiar to administrators and electors, so implementing the changes will be straightforward and we are confident that returning officers will be able to make the necessary changes.
The conduct rules for elections of combined authority and combined county authority mayors are set out in the Combined Authorities (Mayoral Elections) Order 2017. The draft order will make a number of amendments to the 2017 order. As I have said, the SV system was used when combined authority mayors were first established, so the changes will largely revert the 2017 order to its original drafting. The Electoral Commission has been formally consulted on the changes and has raised no objections.
Articles 3 to 5 of the draft order will amend schedules 1 to 3 to the 2017 order, respectively, which set out the conduct rules for these mayoral elections, both when the poll is a stand-alone poll and when the poll at a mayoral election is combined with the poll at another type of election or referendum. The amendments will update the guidance given to voters in polling stations to reflect the fact that they now have the option to select a second preference. They will also update the various processes involved in counting the votes to reflect that a second round of counting may be required. They will also make a number of consequential amendments throughout the conduct rules to ensure that references to votes refer to first and/or second preference votes as appropriate.
Schedules 1 and 2 to the draft order contain updated statutory electoral forms. Schedule 1 sets out the forms in respect of a stand-alone mayoral election, and schedule 2 sets out the forms where a mayoral election is combined with another type of election or referendum. Two types of forms require updating to enable SV. The first is the ballot paper. A new ballot paper image is provided in the draft order to allow voters to select both a first and a second preference of candidates. The draft order also contains the ballot paper to be used when there are only two candidates running, because in that scenario voters will not be given the choice to select a second preference and the poll will revert to a simple majority voting system. The second form is the postal voting statement. Such statements contain guidance to postal voters, and the draft order provides new postal voting statement forms, which will inform the voter that they may select both a first and a second preference where three or more candidates are running.
These are straightforward changes necessary to implement a change set out in primary legislation, the English Devolution and Community Empowerment Act, and I hope that the Committee will join me in supporting the draft order. I look forward to answering any questions Members may have.
David Simmonds (Ruislip, Northwood and Pinner) (Con)
It is a pleasure to serve under your chairmanship, Sir Desmond.
There are many arguments of principle and technical detail regarding the merits or otherwise of the change to the voting system proposed by the Government under this draft legislation, but the Committee is not the place to debate those; they have been considered in Committee previously. I will be clear that the Opposition remain opposed to the change, which reverses a change that we made in government. We remain committed to the elegance and simplicity of first past the post as a means of carrying out elections, rather than any of the other many complex systems that are available around the world. For that reason, we will seek a Division, but I have no questions to put to the Minister.
Zöe Franklin (Guildford) (LD)
It is a pleasure to serve under your chairmanship, Sir Desmond.
We Liberal Democrats are pleased by the reversion to SV and are grateful to the Government for it. We would have liked them to go further and introduce the alternative vote system, but, as the hon. Member for Ruislip, Northwood and Pinner mentioned, such discussions have already been had in full.
Before I end by saying that we will support the Government, let me ask the Minister whether the Government will make an order about police and crime commissioner elections in time to ensure that the surprise such election in Norfolk—because there has been a recent resignation—can take place under the SV system. The Government have established that that is a much fairer system so, given that we are making this shift, it seems wrong for that unexpected PCC election to take place under the old system, potentially wasting £2 million of expenses for an election under a system that the Government have admitted is unfair.
The Liberal Democrats will support the draft order. In future, however, we would like to see change go further, and we will continue to press for that.
Samantha Dixon
I thank hon. Members for their contributions. I note the comments of the hon. Member for Ruislip, Northwood and Pinner. He is quite right: the arguments for and against this particular move have been rehearsed elsewhere in this House. I note, too, his intention to press for a Division.
With regard to the potential PCC election in Norfolk, the Government’s view is that it would not be appropriate to change a voting system when a ballot has already been triggered. Therefore, while we will move forward at pace with the changes to the systems for PCCs and other mayoral elections, we do not feel it is appropriate to do so at this stage.
The draft order is necessary to allow the SV system to be implemented for combined authority and combined county authority mayoral elections to ensure that those elected to those positions have a broad base of support from their electorates. We believe that to be of particular importance for single executive officers.
Question put.
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Lewis Atkinson (Sunderland Central) (Lab)
I beg to move,
That this House has considered e-petition 752673 relating to the timely progress of bills through Parliament.
It is a pleasure to serve with you in the Chair, Sir Edward, and to open this important debate as a member of the Petitions Committee. I want to start by being clear about what this petition, and therefore this debate, is about. Although the petition was prompted by the parliamentary consideration of assisted dying, it is not about assisted dying; it is about British parliamentary democracy and how—or, indeed, whether—it can work.
The petition poses what I would suggest is an existential question for us here: does our constitutional settlement allow changes that have been backed by the public and their representatives to pass into law? I desperately want the answer to that question to be yes. That is not because I want a specific piece of legislation to be passed; it is because if, as a country, we cannot resolve different views through Parliament—developing legislative proposals and scrutinising them, but ultimately reaching a decision on them—we are in a very troubling place.
Bambos Charalambous (Southgate and Wood Green) (Lab)
My hon. Friend has made an excellent start to his speech. Does he agree that if the other place has the ability to block private Members’ Bills, that totally undermines the concept of such Bills going forward?
Lewis Atkinson
I agree that private Members’ Bills provide an important avenue for democratically elected Members of the Commons to seek important legislative change. For decades, they have been a long-established precedent in how this country introduces social change—whether that is the decriminalisation of homosexuality and abortion, or the abolition of the death penalty. Fundamentally, I do not believe that the unelected Lords should be able to block such key social change, but I will come on to some of the issues that my hon. Friend raised.
Lewis Atkinson
I will introduce the petitioners first, because they ultimately prompted the debate; I will then be happy to take further interventions.
The petition was initially proposed by Nathaniel Dye, a man who felt the urgency for change and looked at his Parliament to deliver it. Nat was a music teacher, and after being diagnosed with stage 4 bowel cancer in his mid-30s, he campaigned for cancer awareness and support, being recognised with an MBE for his incredible efforts.
Nathaniel knew he was going to die, and he believed that Parliament should engage seriously with the issues that affected him and many others with terminal illness. He campaigned strongly in favour of the Terminally Ill Adults (End of Life) Bill, which was introduced by my hon. Friend the Member for Spen Valley (Kim Leadbeater) in the last Session. As a member of that Bill Committee, I had the privilege of meeting Nat on a number of occasions. He was a remarkable man.
In his final months, Nat became frustrated—angry, it is fair to say—at how the Lords were dealing with their consideration of the Bill. True to form, he decided to do something about it, starting the petition that we are here to debate today. Nat died in January this year. I pay tribute to him and his family, who have continued to support his efforts following his death. I am grateful to Rebecca Scott, his sister, for meeting me as part of the engagement process for this debate.
After Nathaniel’s death, his friend Sophie Blake became the petition’s sponsor, and it is a pleasure to see her in the Gallery today, as it was to speak with her in preparation for this debate, alongside a campaigner from Dignity in Dying. Sophie has incurable stage 4 secondary breast cancer, first diagnosed in 2020. She is allergic to opioids, which form an important part of the palliative care pain relief toolkit, and unfortunately her family have experienced what she describes as “bad cancer deaths”. She does not want her daughter, Maya—also in the Public Gallery—to run the risk of being left with those memories. She wants the option of an assisted death if she feels that that is required.
The key demand of Nathaniel, Sophie and the 114,000 petitioners is that Bills supported by MPs and the public must be able to complete all stages of the parliamentary process and to become law; and that the unelected House of Lords should be able to scrutinise, yes, but not block legislation backed by the elected Commons. Sophie and Nathaniel were both determined that the voices of terminally ill people should be at the centre of parliamentary consideration of the Bill. They closely monitored its various stages. They were in the Public Gallery of the House of Commons on Second Reading and of Committee Room 11 for some of the 100 hours of Bill Committee proceedings, where we made more than 100 amendments, including 30 proposed by MPs who had opposed the Bill on Second Reading.
Kerry McCarthy (Bristol East) (Lab)
In 2009 and 2010, I used to be the Whip in charge of Friday sittings, but even now I would struggle to explain just how things work with some of the Back-Bench Bills, given some of the shenanigans that go on. Does my hon. Friend agree that it destroys our constituents’ faith in parliamentary democracy when they feel that we are all playing games—filibustering and resorting to tactics to talk a Bill out, rather than debating things on their merits and moving to a vote to determine the will of the House?
Lewis Atkinson
I agree entirely. I absolutely respect the fact that others, including opponents of the Bill, reach different judgments on this difficult issue. Ultimately, as I said, in our parliamentary democracy that is for Parliament to resolve, on the balance of judgment of its constituent-elected MPs. That is explainable to our constituents. If something that constituents wish for is decided on by Parliament, that can be explained; what struggles to be explained is when tactics and filibustering are used to not reach a decision at all. I will come on to talk a little about that.
At this stage, it is important to say that I spoke to groups opposed to assisted dying as part of my preparation for the debate—again, not to discuss the substance of assisted dying itself, but, as part of balance, to get their view about the process. It is fair to say that their position includes the assertion that the Lords were justified in not reaching a decision on the Bill because Commons consideration in Committee was flawed. I personally disagree; having sat in Committee for more than 100 hours—way in excess of nearly any other Bill—I might be expected to say that. Those exact same arguments, however, were available to Members before Third Reading.
Daniel Francis (Bexleyheath and Crayford) (Lab)
As my hon. Friend knows, we both sat long and hard on that Bill Committee. But if we sent the Bill to the other place in good shape, why did the sponsor there table 77 amendments to it? Is my hon. Friend able to outline why that happened?
Lewis Atkinson
I am not here to speak for the sponsor of anything; I am here to speak for parliamentary democracy. Fundamentally, on Third Reading, MPs clearly backed the Bill. That was the final chance for MPs to have their say. In all those debates, my hon. Friend made his points well and ably, as I made mine, in Committee and beyond. I entirely respect his perspective, but I am bringing us back to the issue of parliamentary democracy.
It is entirely appropriate, and no one is disputing—the petitioners are not disputing—that the Lords should scrutinise and indeed amend legislation passed to them from the Commons; what the petitioners find outrageous, frankly, is the failure to consider it. I will come on to that.
Vikki Slade (Mid Dorset and North Poole) (LD)
That is the key. Both the sponsor of the Bill in the House of Lords and others tabled amendments that might well, had they returned to the House of Commons, have had the opportunity to improve the Bill. Would the hon. Gentleman agree that the denial of that opportunity to improve the Bill is an absolute travesty?
Lewis Atkinson
Yes, I agree. I will come on to talk about future consideration of the legislation.
The arguments against the process—that the consideration was somehow flawed—were widely debated before Third Reading, and the Commons reached a conclusion on that. All MPs had to make a judgment, independent of the Whips, on whether they wanted to pass the legislation.
Sophie and Nathaniel were in the Commons Gallery on the day of Third Reading. They, like people across the country, thought a clear decision had been made: that assisted dying reform would become law, with significant safeguards, subject to some further iteration in the Lords, if required, including an extended implementation period of up to five years to allow any other considerations to be worked through. It was the approach of the House of Lords, specifically a small number of peers, that outraged Nathaniel, Sophie and the other petitioners.
Jim Shannon (Strangford) (DUP)
It may only have been a small number of peers who tabled amendments, but many others wished to put their names to them. Does the hon. Gentleman not recognise the will of the House of Lords? I think 170 peers had real concerns about the legislation. The role of the House of Lords is to ensure that those concerns are looked at, and it is fully entitled to do so. On this occasion, it was not able to improve the legislation in the timescale provided. Does the hon. Gentleman not accept that?
Lewis Atkinson
It is always a pleasure to receive an intervention from the hon. Gentleman; he is much more experienced in this place than I am. However, over 16 days of debate in the House of Lords, the will of the Lords was not tested once. There were no Divisions. If the will of the peers was so overwhelmingly against the Bill, the Lords could have divided on Second Reading if the House had wished; it chose not to.
The opponents of the Bill in the Lords went out of their way, it is suggested, to avoid Divisions. Some amendments may have passed, but a great number of others would probably have been defeated. With more than 1,200 amendments tabled, and 1% of peers tabling 60% of them, that small number of peers took up more than a third of the total speaking time.
Several hon. Members rose—
Lewis Atkinson
I will just finish this point. As my hon. Friend the Member for Bexleyheath and Crayford (Daniel Francis) mentioned, Lord Falconer—the Bill’s sponsor in the Lords—made clear that he would sit down and discuss amendments with peers: indeed, he accepted and supported amendments that responded to genuine concerns with the Bill. But there was no opportunity for the Lords to reach a conclusion on amendments, because of the tactics involved.
Mark D’Arcy, a BBC parliamentary correspondent for more than two decades, characterised the Lords’ treatment as this:
“This is a filibuster. If it walks like a duck, quacks like a duck, and tastes good in orange sauce, it’s a duck. If they’re going this slowly over this piece of legislation, I’m afraid it’s a filibuster. There is no other way to describe what’s going on here. It may be in order. It may be within the rules of the House, but what’s happening here is that a relatively small number of peers are putting down lots and lots of amendments and debating them very, very slowly.”
Andrew George (St Ives) (LD)
The hon. Gentleman is making an excellent speech. He will be aware of early-day motion 2709, which I tabled in January. It is about the role of the House of Lords in scrutinising legislation, and the importance of ensuring that they are there purely to scrutinise and provide sober second thought on legislation. It had strong cross-party support. On 12 February, the Leader of the House responded to a question to say that if there were delays,
“I will find time to see how we can progress it. This is a timely warning to their lordships”. —[Official Report, 12 February 2026; Vol. 780, c. 957.]
This was a fundamental attempt—a successful attempt—to block the Bill; it was nothing other than that.
Lewis Atkinson
I thank the hon. Gentleman for his intervention. I agree with him—as does Rod Liddle, a journalist who did not support changing the law and was an opponent of the Bill. He said:
“The truth, I am ashamed to say, is that in the case of the assisted dying Bill, my side won by cheating…What was not right was for opponents of the Bill, no matter how strongly they felt, to use machinery rather than honest debate to get the Bill booted out.”
Dr Marie Tidball (Penistone and Stocksbridge) (Lab)
My hon. Friend the Member for Spen Valley (Kim Leadbeater), who introduced the assisted dying Bill as a private Member’s Bill, cannot be with us today. Does my hon. Friend agree that the filibustering in the Lords and the inability of the Lords to deal with the assisted dying Bill within reasonable time fetters us as Back Benchers, and has a chilling effect on introducing a range of issues of conscience as private Members’ Bills?
Lewis Atkinson
My hon. Friend is right, as is my hon. Friend the Member for Spen Valley (Kim Leadbeater). I have heard it said that it was inappropriate for this issue to be brought as a private Member’s Bill, but equally we know that it would have been inappropriate for it to be included in any party’s manifesto. I see opponents of the Bill, as well as proponents of it, nodding in assent. Clearly, both public opinion and parliamentarians’ opinions on this issue are not split across party lines. The Prime Minister was clear in advance of the general election that he favoured a free vote to decide this issue—not on what the outcome of the issue should be—and that a private Member’s Bill was an entirely appropriate mechanism to achieve that.
I hear some opponents saying, on the one hand, that a private Member’s Bill was never appropriate to do this but, on the other hand, that it would not have been appropriate to include this issue in a manifesto. Therefore, one is left to conclude that those opponents think there is no viable vehicle for social change in this country.
Dame Meg Hillier (Hackney South and Shoreditch) (Lab/Co-op)
The challenge was that this Bill was launched very fast in the House of Commons, without pre-legislative scrutiny, whereas other private Members’ Bills have often been knocked around for a long while and discussed in detail, so that their flaws were recognised, adjusted and amended at different times. This Bill came very fast and there was a lot that was missing that had never been debated in the Commons, because of the way that the system works—not just for private Members’ Bills but generally. We need to legislate better in this country— I think we would all agree with that—and the Lords were doing their job.
Lewis Atkinson
I thank my right hon. Friend for her intervention, and I respect her significant experience and expertise in this place. Again, though, I gently say that that very argument was well rehearsed; in fact, I think she made it on Third Reading. And the judgment collectively of MPs was that it did not carry.
Lewis Atkinson
Apologies—my right hon. Friend may not have spoken, but many other Members certainly made that argument, and it was a key argument for voting against the Bill on Third Reading.
We either believe in parliamentary democracy and in the primacy of the House of Commons where each of us independently reaches our judgment—I accept that it is a judgment; I am not an absolutist on this issue—or we do not. We cannot believe in parliamentary democracy when it suits us and not believe in it when it does not suit us.
Nevertheless, I agree with my right hon. Friend on the need to legislate better and I believe that the Hansard Society has put forward some recommendations about how the approach to private Members’ Bills in general could be improved. I absolutely agree that some improvements could be made.
Several hon. Members rose—
Lewis Atkinson
I will finish my point. Fundamentally, the question is whether we can achieve social change in this country through parliamentary means, or not.
I will just go back to how Sophie, the key petitioner, felt. She summed it up in the following way:
“I’m living with incurable cancer and I know how precious time becomes when you’re facing the end of life. Watching Parliament waste that time because of the actions of a tiny number of unelected politicians is heartbreaking”.
It is not that the House of Lords was improving the Bill. It may have been in some cases, but the fact that the House of Lords, in 16 days, did not divide once and decide on one amendment—
Michael Payne (Gedling) (Lab)
My hon. Friend is making an excellent speech. Does he agree that wherever people stand on assisted dying, the country is reasonably entitled to expect that after 16 days—more than 75 hours—of debate, the House of Lords should have come to a decision on one of the most profound issues that has been debated in this parliamentary Session?
Lewis Atkinson
You want me to make progress, Sir Edward, so I will.
The question then turns to what happens now. What does this mean for assisted dying, yes, but also for the British constitutional settlement? As part of my preparation for this debate, I spoke to Tom Brake, CEO of Unlock Democracy, which campaigns for constitutional reform, including of the House of Lords, to address the democratic deficit. He believes that the case for Lords reform has been significantly strengthened by the behaviour of peers in this episode.
In contrast, the Hansard Society’s director, Dr Ruth Fox, to whom I also spoke in preparation for today, reminded me that the Lords is a self-regulating Chamber. It is not subject to the timetable or expectations of the Commons or anyone else and, she believes, nor should it be. But she is also clear that in the current circumstance the British constitutional settlement provides a clear and appropriate response that the Commons could use to assert its primacy—the Parliament Act 1911. That Act was explicitly designed to be applicable to private Members’ Bills. Indeed, when the Parliament Bill was debated back in the 1910s, an amendment to confine it to Government Bills was defeated. The Parliament Act has been used before on issues of conscience—for example, equalisation of the homosexual age of consent in 2000 or the Hunting Bill in 2004, when the Lords refused to accept the decision of the Commons.
The petitioners believe that it is now necessary to use the Parliament Act for assisted dying legislation also. They point out that if the legislation is reintroduced and passed by the Commons a second time, the Lords will again have a chance to do its job properly—to consider the types of amendments that a number of hon. Members have suggested that they believe the Lords want to see. The Lords may pass amendments for Commons consideration, but under the Parliament Act it would be unable to block progress entirely.
I believe that the Parliament Act gives us a way to answer the question whether parliamentary democracy is still fit to tackle the key issues of our time. I am grateful that my right hon. Friend the Leader of the House is here and I look forward to his assessment of the situation in response to this debate. I hope that he will specifically touch on the Government’s assessment of whether the Parliament Act would be applicable should the Bill be reintroduced and, crucially, whether the Government would make appropriate time available for necessary procedures to take place to allow its use.
Mary Glindon (Newcastle upon Tyne East and Wallsend) (Lab)
I thank my hon. Friend for giving way while making such an important speech on such an important, but also contentious, subject. We know that the Parliament Act has only ever been used seven times and never for a private Member’s Bill, and in recent weeks leading figures have opposed use of the Parliament Act in this way. Does my hon. Friend think that something so contentious that is a private Member’s Bill should override the present constitution?
Lewis Atkinson
I thank my hon. Friend and regional colleague for her intervention. The Parliament Act was explicitly designed to include provision for private Members’ Bills and it has been used on issues of conscience before. I also question the idea of contention. There is no doubt that assisted dying is a really serious matter, but the view of the British public on it is remarkably stable, which makes the resolution through parliamentary means absolutely clear.
As part of my preparation for this debate, I spoke to Sophie Stowers from the polling and insight company More in Common, whose work on this topic, I stress, has been independent and not funded by campaigns on any side. She told me that polling on the introduction of assisted dying has been remarkably consistent from the time of the Bill’s introduction to now, with support levels among the British public of 60%, compared with opposition in the teens. That finding is consistent with work carried out by others, including the Nuffield Council on Bioethics, which ran a citizen’s jury on this topic, exposing all the participants to lengthy discussions on arguments for and against a change in this place.
When I speak to constituents, they still think assisted dying is coming into force because people do not understand—perhaps they cannot understand—how in 2026, elected representatives of their country can vote for something and yet it can still be blocked by a small number of Lords who have no accountability to the public. In its insight work, More in Common reports that people do not understand why the Bill fell, they are puzzled about the suggestion that it ran out of time, and they do not believe that it should be the end of the process. In its polling in January, when it was becoming clear that there was a risk of the Bill running out of time in the Lords, more than four in five citizens said that the assisted dying bill should be introduced again in the Session of Parliament that we are now in.
Mr Angus MacDonald (Inverness, Skye and West Ross-shire) (LD)
In my constituency, I am getting a substantial amount of mail in my inbox from people who are glad that the Bill has been turned away. What they really wanted to see was investment in hospices, and there has been remarkably little to move that forward. I suspect if this Government made a major investment in hospices and the Bill came back in a few years’ time, it would make a big difference.
Lewis Atkinson
I note that the Scottish Parliament democratically came to a judgment on the devolved issue of hospice funding that the hon. Gentleman mentioned. The arguments he made were aired extensively before Third Reading and the Commons made its judgment clear.
I will turn to my conclusions, as I know a lot of Members wish to speak. The public expects Parliament to work. More widely than on assisted dying, we can all sense a general public mood of impatience that change cannot be delivered in this country. Many on the Government Benches felt some of that impatience when it took 18 months from our election to pass the Employment Rights Act 2025, partly due to the ponderously slow process of the Lords. We rightly asserted the primacy of the Commons at that stage.
Parliamentary democracy is not a pick-and-mix affair.
Lewis Atkinson
No, I am going to finish now. More in Common reports a shift from frustration to anger among the general public—not on this issue specifically but because it is too difficult to get things done in this country. There is a sense that our institutions are broken and that action is blocked at every turn. That cannot be healthy for anyone, least of all for people who are dying and have a limited number of days left.
For people like Nathaniel and Sophie, parliamentary delay and inaction are not abstract concepts. Delay takes time that they do not have and it prolongs a status quo that MPs clearly voted to change. I would not serve here if I did not believe in British parliamentary democracy. The petitioners believe that we must act to demonstrate that parliamentary democracy remains fit to deal with the issues of the day, including life or death. I pay tribute to them. This issue is not going away, and I look forward to this debate.
Several hon. Members rose—
Sir Edward Leigh (in the Chair)
Order. A large number of colleagues wish to take part. I want this to be an orderly debate, in which everybody has their say, so I shall institute an immediate six-minute limit on speeches. If everybody sticks to that, everybody should get in. Just in case colleagues are tempted to give way to others and therefore prolong their speech, I should say that nobody will be given extra time if they give way to another colleague. That is to ensure that everybody gets in.
In terms of parliamentary courtesy, this is a debate; it is not an opportunity to come in, make a short intervention and then leave. Therefore, if you make an intervention, you are expected to stay for some significant time and to return for the winding-up speeches. I hope that is agreeable to colleagues.
Siân Berry (Brighton Pavilion) (Green)
Many thanks, Sir Edward, for your firm chairing today, which I now look forward to. I sincerely thank the petitioners, and particularly Sophie Blake for all the work she does and for a very well put petition. I also thank Nathaniel Dye, and I had the genuine honour of meeting him and seeing his work before his death.
I want to add a cross-party voice to the debate. The Greens were not whipped on the issue of assisted dying—we do not whip our Members in any debates—but all four Green MPs voted for this issue of conscience. However, that is not what we are here to debate today; we are here to talk about the process. I was so impressed with it and with the seriousness with which my colleagues and colleagues across the House took this issue. We made our decisions after so much debate and engagement with the Bill text and the amendments, and debates in our offices and with our staff. In our constituencies, we all spoke with constituents from a wide range of different groups. I spoke with young people, disabled people, faith groups, several terminally ill people and people caring for those who were terminally ill. This was serious work.
I was a very new MP when the Bill went through its Second Reading, and I found it so inspiring. It is a sad topic, but I found the debate extraordinary. After all the debate in the House of Commons, which was unwhipped—by any party—and conducted with such seriousness on an issue of conscience, all that work led to a majority for the Bill. We all know what happened next: a refusal by the House of Lords to come to any kind of decision, and the effective blocking of any further consideration of this issue, into which we had all put so much work.
Tom Rutland (East Worthing and Shoreham) (Lab)
I thank my constituency neighbour for giving way. Many of my constituents have been deeply upset by the way a small number of peers blocked the passage of the assisted dying Bill, despite the broad support from the public and from a majority of MPs every time it was voted on. Does she agree that debate on the Bill, about which there are strongly held, principled views on both sides, is very welcome, but that intentionally filibustering to prevent its passage is unworthy of this Parliament?
Siân Berry
I quite agree. It was courageous of the House to take on this issue, consider it and then vote. We put our names to positions that we came to with some courage, I think, because we all knew there were people who felt very strongly the opposite way, whichever way we voted.
On the principle—on this and any other issue where a similar process takes place and the House of Commons has the courage to come to a decision—I agree that it is not for the House of Lords to stop that using these kinds of methods. I agree with the petition writers, who want the Government
“to ensure that when bills are supported by MPs & the public, they have the time to complete all their stages in Parliament.”
That is 114,000-plus signatories, alongside the 69% of people polled this year who believe that the debate on assisted dying should have continued until Parliament reached a conclusion.
I look forward to hearing from the Leader of the House about what can be done so that we can make the important private Members’ Bill process viable again in the future and restore the public’s faith in the health of democracy—I will not beat around the bush—and in the ability of this Parliament to make decisions on issues of such importance to so many of our constituents.
Lizzi Collinge (Morecambe and Lunesdale) (Lab)
It is a pleasure to serve under your chairship, Sir Edward. I want to speak about the process of the Terminally Ill Adults (End of Life) Bill, which was prevented from completing its parliamentary journey by a small number of unelected peers who showed through their actions that they had no respect for the constitutional settlement of this country, no respect for the House of Commons, no respect for their own role as scrutineers and no respect for the British public.
Lizzi Collinge
I am sorry; I will not give way, as I want to finish this speech.
The House of Lords at its best provides detailed scrutiny of legislation, proposing amendments to make it more workable and addressing criticisms of it. But this was not the House of Lords at its best; this was the House of Lords that I remember from my early adulthood: the Lords who kept blocking the equalisation of the age of consent for gay men and who delayed the repeal of section 28. What august company for these modern-day peers to be in! In each of those cases, the primacy of the Commons was asserted, and I really hope that once again the primacy of the Commons and the will of the British people prevail.
Opponents of the Terminally Ill Adults (End of Life) Bill will say that the actions of those few peers were the Lords providing the scrutiny that the Commons did not. I say: what utter nonsense. We have already heard that over 1,200 amendments were proposed, including a pregnancy test for all applicants, regardless of their sex or fertility status. Is that scrutiny, or is it filibustering? I think we know the answer.
In the Commons, the Bill had more scrutiny in terms of debate on the Floor and hours in Committee than any Government Bill of recent times. I remember those debates in the Commons; for the most part, they were nuanced, thoughtful and well intentioned. I remind Members that the issue of assisted dying has been debated for over 100 years in this country. I have also sat on multiple Bill Committees, including some of the longer and more contentious ones in this Parliament, and they did not last as long or see as many amendments debated as the Terminally Ill Adults (End of Life) Bill did in the Commons. If a process that went above and beyond the process for any Government Bill is not sufficient to pass a law, what is?
The debate in this place and the subsequent amendments to the Bill addressed matters of substance that were raised because of often understandable concerns. They were supported by many of us who support the right of someone to choose the timing and manner of their own death in principle, but who would not support a Bill that exposed people to the risk of not making that choice freely or that did not have strong guardrails. My conclusion, and the conclusion of the Commons debate, was that this was about how a Bill would operate in practice. What we saw in the Lords was not that. The majority of Lords were first prevented from voting on any aspect of the Bill whatever, and the clogging of the debate with unserious amendments prevented a proper debate on matters of substance.
Where does that leave us? It leaves us in a dangerous status quo where terminally ill adults, with the means to do so, go abroad to die, often too early. It leaves us with a legal situation where the manner of someone’s death and the intention of the people who were with them are determined after someone is dead and cannot make their views known. It leaves hundreds of terminally ill adults taking their lives every year, often in very upsetting circumstances. Most people will die a perfectly ordinary death, managed well by palliative care, but palliative care cannot help everyone, no matter how good it is. Anyone who says otherwise is unfortunately not telling the truth. That has been demonstrated, unfortunately, by too many difficult deaths and by the pain of too many families who are left behind.
The debate today is about something even bigger than those tragedies; it is about the constitutional settlement of the United Kingdom. It is about the reasons why we have decided that those with no democratic mandate should not be able to block the will of the elected Chamber. It is about trust in Parliament—trust that we will act with dignity and respect for the proper way of doing things, and know our constitutional places and the limits placed on our power, which are there for a very good reason. It is about the ability of the Lords to behave in a way that allows us to have flexibility in our constitutional settlement, to move with the times and not to be bound by a single, rigid written document. I see great value in having flexibility in our constitutional mechanisms. However, that relies on individuals and groups of individuals operating with honour—something that, unfortunately, this episode did not demonstrate. I worry that if that is repeated, we risk having to move to a more rigid system to enable the primacy of the Commons.
The British people expect high standards of scrutiny from parliamentarians, in both this place and the other place. In the case of the Terminally Ill Adults (End of Life) Bill, the House of Commons did its job very well. In the other place, the Lords were prevented from doing their job properly by the actions of a minority. Not only for the memory of Nat—our friend and fellow campaigner—but for every person in this country, that cannot be allowed to stand.
John Cooper (Dumfries and Galloway) (Con)
It is a pleasure to serve under the iron grip of your chairmanship, Sir Edward.
We are here not to relitigate the substance of the assisted dying Bill, but to consider a profound change to the way we in this place carry out our duties as legislators. The petitioners seek, in short, for a failed Bill to be smashed through, as though it had not been subject to proper procedure, and for us to accept that it fell through procedural malfeasance. It is not so: this Bill failed because a gamble was taken to proceed down the private Member’s Bill route. It is well known that such Bills can run out of road due to time constraints.
The emotive nature of the subject of the Bill is obvious, but just as the Commons debate was dominated by deeply moving yet ultimately anecdotal accounts of painful deaths, we cannot decide here on emotion. Bad cases do not make good laws. We must decide on cold, hard facts. It is a fact that this Bill carried a major flaw at its heart, in that it was not part of the Labour manifesto on which this Government were elected.
It is also a fact that the Lords’ scrutiny role is designed to prevent the passage of poor legislation. This was flawed legislation, replete with issues unresolved at Committee, and passed to the Lords in a situation that Cabinet Office guidance warned would “likely kill the Bill”. I have seen all too often the result of a paucity of scrutiny when legislation has passed through the Scottish Parliament. Holyrood lacks a revising Chamber entirely, with its Committees expected to do the hard work of line-by-line consideration.
This petition is couched in terms of fairness and democracy, but it is neither fair nor democratic to usurp our system for reasons of dogma. No matter the subject of a Bill, if it lacks a manifesto heritage, staggers through Committee amidst a welter of chops and changes, and ultimately fails on contact with the Lords, we have no place attempting to resurrect it because we admire its aims or because it is popular.
Jonathan Davies (Mid Derbyshire) (Lab)
It continues to be the case that the royal medical colleges and many of the organisations representing disabled people take issue with the Bill as it stands. Does the hon. Gentleman agree that, while many among the general public would like to see assisted dying, or assisted suicide, introduced in principle, the detail of the legislation matters, and therefore the House of Lords was doing its job in providing that scrutiny?
John Cooper
I completely agree with the hon. Gentleman that this Bill has huge difficulties, and its popularity does not capture those. The Salisbury-Addison convention that the Lords will not seek to prevent the Government from implementing manifesto pledges simply does not apply. In this case, it has not been breached. The Government made repeated declarations that they were neutral on the Bill—that it was a private Member’s Bill—and so the convention does not arise. We cannot let the emotional baggage of the assisted dying Bill override proper parliamentary procedure.
John Cooper
I will finish.
Of course, the legislation approving abortion in this country came through the private Member’s Bill route, but that was backed by the then Labour Government, who appointed a medical advisory committee that also supported its passage. That was a gold standard, against which this Bill is mere base metal. It fell—and fallen it should remain.
Dr Simon Opher (Stroud) (Lab)
I thank the 326 signatories from Stroud who helped to make this debate possible, as well as the many petitioners who are in the Public Gallery. I also thank my hon. Friend the Member for Sunderland Central (Lewis Atkinson) for what I thought was an absolutely excellent speech.
Even before taking up my role as an MP, I cannot say that I was a massive fan of the other place. There are undoubtedly many wonderful peers whose expertise and scrutiny make a valuable contribution to our legislative process. However, the idea that individuals should by virtue of their religious office or, until very recently, the lottery of life—or, indeed, because of political donations or cronyism—have a role in shaping, and blocking, our laws is impossible to justify in a democracy.
My views on the issue were cemented by my experience with the Terminally Ill Adults Bill. I had the privilege of serving on the Bill Committee, which sat for more than 100 hours, considered hundreds of pieces of written evidence, heard three full days of oral evidence from experts and accepted more than 150 amendments. I also explored my constituents’ views on this during many surgeries. I take issue with the idea that the Bill is not a good piece of legislation. I have worked in palliative care for many years, and this is an excellent piece of legislation. Saying that it is weak is simply a tactic used by those who do not agree with assisted dying.
Through abuse of parliamentary procedure, a handful of peers were able to impede the progress of the Bill, despite it being endorsed by the Commons and the public. According to polling, only 14% of people believe that the House of Lords should be able to prevent the Bill. Just 1% of peers took up more than a third of the speaking time on the Bill, tabling 60% of the amendments. As we have heard, although many of those amendments were tabled in good faith, others, which I will not go into, were absolutely ridiculous. The obstruction we saw with the assisted dying Bill can never be allowed to happen again. I am grateful that we have and can use the Parliament Act, but it is increasingly clear that we must look at other mechanisms. We need to completely change, and possibly even get rid of, the House of Lords.
Peers continue to frustrate the timely progress of Bills that were passed by the democratically elected Commons. There was not just the assisted dying Bill, but the Employment Rights Act 2025, when Opposition peers refused to put down their bats in the game of ping-pong. That is why I, with others, set up the all-party parliamentary group on House of Lords reform to examine the options for reform.
Comprehensive reform may take time, but there are practical changes that could be implemented in the shorter term. The self-governance of the House of Lords is fiercely guarded by many peers; however, without underpinning rules, those gentlemen’s agreements are open to abuse, as we saw over the course of the previous parliamentary Session. I had the pleasure of speaking to Baroness Smith, the Leader of the House of Lords, and although she managed to deliver all the Government business in a difficult Parliament, the ability of a small number of peers to disrupt, due to the lack of authority of the House of Lords Speaker, was abundantly clear.
For private Members’ Bills, it was open season, as in those circumstances the Speaker has no powers of curtailment or to insist on the grouping of amendments, nor can the party leaders in the Lords impose any discipline. There are, in fact, no rules, which allows a small number of peers to block legislation based on their own particular views. It is time that the other place adopts rules about conduct and the primacy of the Speaker. In the longer term, we need to abolish the House of Lords Chamber and replace it with something that is fit for purpose.
The public expect Parliament to debate, scrutinise and improve legislation, and not allow a small, unelected minority to prevent the will of the elected House from being carried into law. I hope that the Government will work with hon. Members to ensure that what happened to the assisted dying Bill will never happen again, and that the will of the Commons on that point is made in law.
Andrew George (St Ives) (LD)
It is a pleasure to serve under your chairmanship, Sir Edward. I warmly congratulate the hon. Member for Sunderland Central (Lewis Atkinson) on the way in which he introduced the debate and the strong case he made about not only the Bill and its treatment, but the recommendations for reform of the House of Lords. As he said, we do not want to rehash the debate on the Terminally Ill Adults Bill, but as we have seen, people on both sides of the debate were disgusted by the way in which a small minority of their lordships were able to abuse the powers available to them, not to scrutinise but to block the Bill. Indeed, a strong opponent of the Bill, Rod Liddle, described his side winning “by cheating”, which is exactly what happened.
Their lordships on many occasions in a rather condescending way told the democratically elected Chamber of the House of Commons that the Bill it passed on Third Reading was not fit for purpose. The fact is that if we all designed a private Member’s Bill, there would be 650 different versions. The concept of a perfect Bill can no doubt be debated by everyone that looks at it, and they would say, “I would prefer it to be amended in this manner” or “in that manner”. The fact is that the way in which the hon. Member for Spen Valley (Kim Leadbeater) proceeded, accepting very sensible amendments, meant that we ended up with a stronger and very effective Bill.
Daniel Francis
Is the hon. Member aware that I fought long and hard on the learning disability issue in the Bill Committee? The sponsor in the House of Lords had amendments that would have undone some of those commitments. If the Bill had passed in the Lords, we could have then been stuck in a ping-pong situation with the amendments that had been passed in the Commons being undone by the Lords.
Andrew George
The hon. Member makes a very strong point. There were more than 100 hours of debate and scrutiny in Committee and in the Chamber. I am sure that we all in this Chamber engaged in thousands of hours of discussion with specialist bodies and had private meetings and investigations on the matter. I am on the Health and Social Care Committee and therefore take these issues very seriously.
I have mentioned the early-day motion that I tabled at the end of January, which castigated the House of Lords and proposed that if it continued with its filibuster, we needed to accelerate reform of the House of Lords. It has certainly precipitated a justification for that from the House of Commons and the Government, and I hope the Leader of the House will follow that accelerated reform through in the light of what has happened, which I think is quite disgraceful.
Olly Glover (Didcot and Wantage) (LD)
My hon. Friend is making a very good speech, so I say this with some trepidation, given how well he has done in the private Member’s Bill ballot this time round. Something that could unite people with differing views in this Chamber would be significant House of Lords reform and meaningful reform of the private Member’s Bill process.
Andrew George
My hon. Friend makes a strong point. I was No. 4 this time round. Having been No. 1 in 2014, I know what it is like to go through the process. On that point, I find it unacceptable that I am under significant pressure to take this Bill through again, which denies me the opportunity to take through the many other options that I should be entitled to take forward. I leave the House awaiting my announcement on the 17th.
As I mentioned earlier, the Leader of the House said in his answer to me on 12 February that
“I will find time to see how we can progress it. This is a timely warning to their lordships”.—[Official Report, 12 February 2026; Vol. 780, c. 957.]
It should not now be down to a private Member to take the matter through. It should be down to the Government. If the will of the House has been decided, the Government need to find time to use the Parliament Acts to ensure that democratic principles are upheld.
If we are looking at reforming the House of Lords, we need to start by asking what we want a second Chamber for and, indeed, if we want a second Chamber. We need scrutiny and a sober second thought. Others might mention a democratic deficit. In my view, the best thing is to abolish the place. I would rather see it replaced with a citizens’ assembly and an appointments commission bringing the brightest and best from all walks of life into the Chamber. What we do not want is a second Chamber in competition with the House of Commons. I look forward to the concluding remarks from the Leader of the House, and I hope that he will think hard about his words to me and will find us time to take this Bill through.
Andy Slaughter (Hammersmith and Chiswick) (Lab)
It is a pleasure to serve under your chairmanship, Sir Edward. I thank my hon. Friend the Member for Sunderland Central (Lewis Atkinson) for his excellent opening speech.
In the 21 years that I have been entering the private Members’ Bill ballot, my name has been drawn out once, in 2018. My Freedom of Information (Extension) Bill—a very fine piece of legislation that I will have to tell hon. Members about another time—was talked out by a Conservative Back Bencher who tried to console me afterwards by saying that he supported my Bill, but wanted to make sure that the Bill after mine was talked out properly. It is therefore right to say that private Members’ Bills are fragile things, are often subject to headwinds, most commonly because the Government do not want the Bill to proceed, and are susceptible to sabotage.
But I do not believe that that is or should be the case with the Terminally Ill Adults (End of Life) Bill. It is an exception because it received the endorsement of the House of Commons on Second and Third Reading because of successive polls of the public. We are all doubtful about the veracity of polls, but when one has a very substantial majority of people over many years, we are wrong to ignore the will of public in that way. The Government are allowing passage of the Bill, so it is only the filibuster in the Lords, by a small number of peers, that has harpooned this piece of legislation thus far. Frankly, I would respect the Bill’s opponents if they were clear and up front that they were using procedural means to talk out the Bill because of their position on it, rather than pretending that the amendments tabled are serious.
Mr Jonathan Brash (Hartlepool) (Lab)
My hon. Friend used a word that has been used several times today: filibuster. In essence, that means “stop at all costs”. Given that that has been the behaviour of the House of Lords, has it not given up its rights as a revising Chamber if the intention is to stop this at all costs?
Andy Slaughter
I am coming to that. I will not take up all my time, because I suspect that we all know each other’s minds on this matter and are unlikely to change them. We need another vote so that the Bill can progress, and there is a mechanism in the Parliament Act for that to happen, which is a perfectly legitimate and logical next step.
I think that there is arrogance in the way the Bill has been opposed, because it restricts the agency of the individual and seeks to take control of their lives. I am quite surprised that some Members, particularly those who come from more individualistic traditions than I do, are prepared to see that. It also increases the suffering of our fellow citizens. I think those are moral and constitutional issues; I do not believe that state actors should be able to constrain the freedom of the individual. There have been legitimate concerns about safeguarding in the Bill. They have been debated and provided for, and I do not believe that a sufficient alternative has been provided.
In conclusion, there is a credibility problem here for Parliament. Our constituents will look at us and say, “We have asked you to do something and you have failed to deliver it, despite the fact that you have the ability, the will and the mechanisms to do it.” Let us just get on with it now, and let us use the Parliament Act as it is intended to be used.
Sir Andrew Mitchell (Sutton Coldfield) (Con)
Thank you very much for calling me, Sir Edward.
I congratulate the hon. Member for Sunderland Central (Lewis Atkinson), in part of whose constituency I fought an election more than 40 years ago, on his excellent speech. He has focused us all on the fact that we are discussing not the issue itself, but the way in which Parliament has handled it. I have enormous respect for those who are against the assisted dying Bill. I was against all that when I came into the House of Commons, but I have changed my mind over the years for many reasons. I am particularly grateful to the Leader of the House for giving up his time to respond to this debate, underlining that it is for Parliament to sort out how we handle this issue. We have a considerable problem: if we get the Bill through the Commons again without invoking the Parliament Act, those few Lords will filibuster it all over again. What the highly respected BBC journalist Mark D’Arcy said, which the hon. Member for Sunderland Central quoted, is absolutely right.
A large number of our constituents want the Bill to go through, but we must remember the background. Judges, lawyers and the Crown Prosecution Service have made decisions that encroach on the area. The Lords had made the decision before, in relation to Lord Falconer’s Assisted Dying for Terminally Ill Adults Bill. Everyone said, “No, this is for the elected House of Commons to decide.” It is for us—the elected Members—to decide and give our judgment, and that is what the Commons did during that memorable Second Reading debate—one of the best debates I have seen in nearly 40 years in the House.
Now, for whatever reason, Parliament has not delivered what the public expect it to deliver, and that has had a belittling effect on Parliament. Individually, Members of Parliament may not be the subjects of great respect, but Parliament itself is. If Parliament can find time for technical transport, fisheries and regulatory measures, it can surely find Government time for a major question of life, death and personal choice—that is my submission this afternoon. Respect for Parliament will erode, and our many constituents will be deeply dismayed, unless we deliver the Bill. That is the wish of Parliament.
The Abortion Act 1967 was a private Member’s Bill, but the Government recognised it as a major issue of conscience and public policy, and ensured that sufficient parliamentary time was available. Without that, the Bill would not have got through. We should remember that, as I think has been alluded to, other landmark reforms of the ’60s, including the abolition of the death penalty and the decriminalisation of homosexuality, relied on Government support for additional parliamentary time despite being private Members’ Bills. I say to the Leader of the House that assisted dying falls in the best traditions of those decisions. I hope that he and his colleagues will feel able to make the same sort of decisions that our forebears did back in the ’60s.
Unless we have Government time, this will not work. It will gravely damage the reputation of Parliament, which will not have opined either way on this vital issue of conscience for reasons of procedure. Our constituents will feel that we are not coming to a conclusion either way, and we will have let them down. The answer is Government time.
Dame Meg Hillier (Hackney South and Shoreditch) (Lab/Co-op)
It is a pleasure to speak under your chairmanship, Sir Edward. Before I go on to make some other comments, I want to nail a few myths that have been brought up.
There has been some talk of how Government Bill Committees that Members have sat on have been shorter than the private Member’s Bill on assisted dying. That is because Government Bills are timetabled. Guillotines are put in because the usual channels get in touch to limit the debate, and there is always an in-built Government majority on those Committees. It is not unusual for more time to be spent on a Bill that does not have those constraints. It is also worth noting that the Terminally Ill Adults (End of Life) Bill Committee had a majority built in by the sponsor, so there was very little chance of any change in that. A lot of people voted on Second Reading for change and discussion in Committee, but few changes were made—most of the amendments were made by the sponsor. Bills relating to hunting and equal marriage were supported by Government, whereas assisted dying is not explicitly supported by this Labour Government. If they were to support it, I think there would be a major crisis in the party, as that policy was not in the manifesto and was not discussed in any of our normal policy procedures.
It is important to correct what my hon. Friend the Member for Sunderland Central (Lewis Atkinson) kept saying in his opening speech about there being no votes or opportunities to divide in the Lords. That is because Committee stage in the Lords is not an amending stage and there is no opportunity to vote—the votes happen at a later time. That is just the way that the House of Lords works, and it is really important not to criticise the Lords for following their normal procedures. There was not anything special or different in their approach to the Bill.
Dame Meg Hillier
I need to make progress, but I will give way in a moment.
Most of the Lords speeches on the Bill were very short. Filibustering, which many hon. Members in this Chamber will have done or seen, is when Members stand up to speak for prolonged periods. Sometimes the Whips ask Members to do so, perhaps because someone is off site and they need to prolong a debate—those things happen. Yet most of the speeches in the Lords were around five minutes or less.
The pregnancy amendment, which has been discussed, was often ridiculed, but when the Bill went to the Lords, there had been no discussion in the House of Commons about what would happen if someone who was pregnant wanted an assisted death. In some jurisdictions, such a person must have a termination before they can have an assisted death, while in others, they must have given birth.
Dame Meg Hillier
No.
The point is that the Lords had a discussion about what to do in those circumstances, for which there was no policy. Such things are important to nail down and resolve, yet that issue is still not resolved.
There is public support in principle for the Bill but that is not carte blanche. There is massive concern about the detail, but I do not have time to go into all of it. We know that most of the royal colleges are concerned about the Bill. It is important to remember that we are legislators: we make law that must be deliverable and unambiguous. The Commons is not simply a debating Chamber. Members debate, and this Chamber is a debating Chamber—we are not voting on law in this debate—but it is important that we legislate for the real world.
There is a role for a revising Chamber, because, frankly, we do not do that well in the Commons. We often have very little scrutiny, alongside in-built Government majorities. In recent times, perhaps because of the nature of a large majority, business has run short in the Chamber. We are unable to make changes in secondary legislation because of the in-built Government majority on delegated legislation Committees. The assisted dying Bill had an awful lot of Henry VIII powers: 42 delegated powers for any future Government—who may be mad, bad or dangerous, and of any existing party or one yet to be thought of—to make these decisions. That is what we would be giving away if the Bill were to pass. That is why we have a revising Chamber to discuss such matters. As I mentioned in an intervention on my hon. Friend the Member for Sunderland Central, there was no real pre-legislative scrutiny of the Bill and little time for MPs to engage with it. The Bill Committee sat for a long time but it had an in-built majority.
It is important that we discuss how we legislate, but let us not demonise the House of Lords. We in the Commons need to do a better job. That is not just about standing up and reading out pre-prepared speeches; it is also engaging and having discussions. In my 21 years in this House, I have had the privilege of engaging on issues with people with whom I disagree. Sometimes we find points of agreement, but we challenge each other in the House on such issues. We are not doing that well enough in this place. We need the Lords to do it.
Dame Meg Hillier
I have very little time left and I need to make a couple of other points. [Interruption.] Well, we have had strict instructions on time. I will, as I said at the beginning of my speech, take an intervention from my hon. Friend the Member for Sunderland Central in a moment.
The Bill that was introduced did not benefit from Government drafting, from policy development or from the whole weight of the machinery of Government and Whitehall, which includes interaction between Departments, such as on how money is spent.
Lewis Atkinson
Like others, I sat with officials from the Department of Health and Social Care after Second Reading, so there absolutely was DHSC involvement, including in many of the amendments that Lord Falconer introduced. Going back to the principle of parliamentary democracy, I respect the point that my hon. Friend makes, but all the issues she has highlighted were aired before Third Reading. She says that we are not a debating Chamber but a decision Chamber, so why—
Lewis Atkinson
We reached a decision. Does my hon. Friend not agree that it should be respected?
Dame Meg Hillier
The whole point of the process is that we have a revising Chamber. If the Bill were to be reintroduced under the Parliament Act, we would be in dangerous territory. We are mischaracterising the Lords. We need to be careful about that, and very careful about using a parliamentary mechanism such as the Parliament Act to set a precedent for any mad, bad or dangerous Government to take things that were never in their manifesto and ram them through Parliament via a private Member’s Bill. That may appeal to many people in this Chamber in relation to the assisted dying Bill, but we must also look at the long-term precedent. In considering how we legislate in this place, let us not demonise the Lords for doing their job in the current system.
Luke Taylor (Sutton and Cheam) (LD)
It is, as always, a pleasure to serve under your chairship, Sir Edward. I thank the hon. Member for Sunderland Central (Lewis Atkinson) for introducing the debate so capably, as well as the petitioners, who are the reason we are having this debate.
The petition is incredibly simple. It asks to apply the very basic principle that when Bills are supported by MPs and the public, they have time to complete all their parliamentary stages. We have heard a couple of extraordinary arguments against that in this debate—that is a surprise. I no longer have to read, “We won’t hear a credible argument against that principle”, although I think that is still true. It is entirely possible to support the need for a reviewing upper Chamber while believing that, if there is significant popular will in favour of a piece of legislation, and valid evidence in favour of its implementation, the Commons’ view that a Bill should at least be considered should ultimately prevail. Unfortunately, we are here because that principle has not been applied to the Terminally Ill Adults (End of Life) Bill.
Let us quickly remember the Bill was given its Second Reading by 330 votes to 275. It was given its Third Reading by 314 votes to 291. As we have heard, in May 2025, after being told about the specific eligibility criteria and key provisions of the Bill that had passed its Third Reading, 73% of the public backed it. Even its opponents must accept that the Bill was supported by MPs and the public.
When the petition was launched in February, there was hope that it would not be necessary—that the Lords would complete their scrutiny of the Bill and a stronger, improved Bill would come back for debate in the Commons. Unfortunately, that was not to be. As the Government’s response to the petition on 26 February made clear, the Parliament Acts of 1911 and 1949 established the primacy of the House of Commons as a cornerstone of democratic process.
Ashley Dalton (West Lancashire) (Lab)
I wonder whether the hon. Member might clarify something. He stated that the Bill could have come back to be debated in the Commons. A Bill does not come back to the Commons to be debated after it has been to the House of Lords. All the Commons can do is consider Lords amendments. It cannot debate the Bill again. Would he like to correct that?
Luke Taylor
We could have considered it, but we never got the chance because it was filibustered—it was spoken out.
As with so much of our unwritten constitution, that principle’s ability to prevail, including for private Members’ Bills that enjoy significant support, relies on the good chaps and chapesses theory of government. Peter Hennessy described that theory as an unwarranted faith that
“those who rise to high office will be ‘good chaps’”
and chapesses who know “the unwritten rules” and want to
“adhere to them, even if doing so might frustrate the attainment of their policy objectives”.
When we examine the amendments and speeches in the Lords, it is clear that, in this instance, that theory has spectacularly failed.
When the Bill fell, 1,280 amendments had been tabled. Seven of the most vocal opponents put forward nearly 700 amendments between them. It is worth looking at a couple of those who are most responsible for blocking the Bill. Baroness Finlay of Llandaff tabled 169 amendments and Baroness Grey-Thompson tabled 131, including amendment 458, which proposed, as we have heard, that every applicant, including men, people over 75 and those who are infertile, must supply a negative pregnancy test.
Lord Carlile of Berriew tabled 72 amendments, as did Baroness Coffey, whose amendment 15 sought to exclude anyone who had left the UK in the previous 12 months, which would have meant anyone who had been on holiday or received a terminally ill prognosis of six months while abroad. Lord Sandhurst tabled 68 amendments, Lord Goodman of Wycombe 59 and Lord Moylan 46, including amendment 236, which would have forbidden the patient’s co-ordinating doctor from ever being employed in any way by the NHS at the same time that the process was being followed.
None of those amendments was about making the Bill better, improving safeguards or refining the Bill. They were meant entirely to frustrate the will of MPs and the will of the public. In the same way that Boris Johnson obliterated the good chaps theory in the Commons, those seven Members of the House of Lords have been most directly responsible for finally obliterating the good chaps theory in the Lords.
As we have heard, constitutional expert Mark D’arcy said that the process was clearly a “filibuster”. We have heard Rod Liddle, who was opposed to the Bill, say that his “side won by cheating”, and that opponents of the Bill had used
“the machinery of government, rather than honest debate, to get it booted out”.
Lord Moylan, who tabled 46 amendments, openly posted on Twitter that,
“Peers are justified in blocking assisted dying bill”.
He also shared an editorial from The Times saying that,
“Peers who want to continue blocking this bill and prevent it from ever becoming law are justified in doing so.”
Clearly, that is a reference to the use of amendments and speeches to block the Bill.
Thus far, I have focused on the process, but it is important to mention the real human costs of those who are faced with one of the most heartbreaking decisions possible at their most vulnerable time. As with so many other private Members’ Bills in our long and proud history, the human story that hides behind the constitutional fray that we have been arguing about can get lost. Once it reaches the statute book, the net gain and the quality of life of those that it affects shine through.
It was the same for the right to an abortion, and for someone’s rights to love and marry who they love. Now, it is the right to the most fundamental exercise of individual will and liberty imaginable. This debate is about hope, choice and taking control of the end of life. That hope and choice has been taken away by a tiny number of unelected legislators who have wilfully tested the good chap theory to destruction. We must take every opportunity to ensure that this is not allowed to go unchecked, that the lessons do not go unlearned and, most crucially, that the alleviation of suffering offered by the Bill is not lost for another generation.
Daniel Zeichner (Cambridge) (Lab)
It is a pleasure to serve with you in the Chair, Sir Edward. I congratulate my hon. Friend the Member for Sunderland Central (Lewis Atkinson) on the thoughtful and intelligent way he introduced the debate. As in every constituency, there are strongly held views on this issue in Cambridge. My constituents continue to write to me frequently. Most want the assisted dying Bill to proceed, as do the wider public.
I supported the Bill at every stage, as I supported similar proposals a decade ago when they were introduced with great dignity by Rob Marris. I will continue to support such proposals. Although I appreciate the need to guard against vulnerable people being subjected to pressure, I do not believe that should stop rational, responsible people having agency over their lives.
This debate is not about that; it is about the ability of the upper House to frustrate the will of the Commons. That, too, is a delicate issue in a country without a written constitution. I should declare a long-held interest, as I was once the organiser of the campaign for a democratic upper house. It was a small group, dedicated to achieving change within the Labour party. I pay tribute to my friend Damien Welfare for his tireless efforts over many years, which bore fruit in achieving promises in various Labour manifestos, but change comes slowly.
Liz Saville Roberts (Dwyfor Meirionnydd) (PC)
We all know the amount of public concern following what happened in the House of Lords. The hon. Gentleman touched on how the Labour manifesto said there would be considerable modernisation. I wonder whether he would be interested in the private Member’s Bill of my colleague, Baroness Smith of Llanfaes. Her House of Lords (Alternative Second Chamber) Bill calls on the Secretary of State to run a public consultation, and I think the public should have a say in how the House of Lords operates. I imagine that many of the public feel very strongly about the legislation we are discussing today.
Daniel Zeichner
I can assure the right hon. Lady that there are many people in Cambridge who follow these things very closely, so I do not disagree.
I also pay tribute to my friend Meg Russell from the constitution unit, who has become something of a go-to person on Lords reform. I credit her with persuading me of the merits of a serious revising Chamber, because those of us who put ourselves forward for election have an in-built bias in favour of elections. Frankly, it can be pretty hard to get here—it took me 20 years and five attempts—so I find myself wondering why an appointed Chamber should have the power to frustrate.
I will not go through the well-rehearsed arguments, but suffice it to say that, from experience, I am aware that an elected Chamber does not always get things right first time. I have great respect for the experience and seriousness of many colleagues in the Lords, but—and there is a but—the delicate relationship is based on an understanding that the elected Chamber has primacy, and that is where this petition has force. I do not doubt the sincerity of those who have chosen to filibuster the Bill, and that practice has a long tradition in many jurisdictions, but here there has long been an understanding that the Lords may delay but not destroy.
On this issue, the will of the elected Chamber is clear, and it reflects the will of the people. Those in the Lords using these procedures to thwart that will should think hard about what they have done. They have put the relationship between the Lords and the Commons under scrutiny, and if this cannot be resolved, I am afraid it is clear what must come next: the relationship must change. I doubt that is what they want, but if this Parliament cannot find a way forward, much less sympathetic successors almost certainly will. I have long been in favour of a democratically elected second Chamber, reflecting the regions and nations of our country—a revising Chamber, yes, but one with democratic legitimacy. I hope this debate and this petition help to bring that a step closer.
Tom Tugendhat (Tonbridge) (Con)
It is always a pleasure to serve with you in the Chair, Sir Edward. The challenge this case brings up has been seen over and again in this place. It is not just about the legitimacy of the Commons. The hon. Member for Sunderland Central (Lewis Atkinson) said this is about not just parliamentary democracy, but constitutional reform. That is a perfectly acceptable position to hold, but it is not a matter specifically related to the assisted dying Bill.
What the hon. Member is suggesting, and it is a perfectly legitimate point to make, is that, actually, our parliamentary system is completely broken, that no revision is possible from the second Chamber, and that the second Chamber should not have a voice on how those amendments are made. Again, that is a perfectly acceptable point to make, because if we are to have the system that we currently have, and if we are to use it in the way that we currently do, I am afraid the position that the Lords have taken is completely legitimate. What they have done—totally within their own rules and totally in the way that House works—is that they have listened to outside voices; they have heard from other sources, as well as from those that were heard in Committee or in the debate in our own Chamber; they have tabled some amendments, some of which have been accepted and others rejected by various people in the Lords; and they have come to a position.
Tom Tugendhat
I will not be giving way on that. If the hon. Member for Sunderland Central does not like that position, or the way in which the Lords run their business, that, again, is a perfectly legitimate thing to say, but then he is asking for very fundamental constitutional reform. Again, that is completely okay, but to do it on the basis of a petition of 140,000 names strikes me as a somewhat ambitious reading of the settled will of the British people. We have somewhere between 60 million and 70 million people—I am not quite sure where the figure sits today—and 140,000 does not sit very high against that number; it sits pretty low, frankly.
Lewis Atkinson
I think the right hon. Member is rather mischaracterising what I said. As I said, and as the Hansard Society says, I think there is a clear constitutional response within our existing settlement. It is not about fundamental Lords reform, though I may be in favour of that; it is about use of the Parliament Act. Does he agree that, if the Commons agrees to this again, using the Parliament Act is entirely appropriate?
Tom Tugendhat
On the contrary, I think what the hon. Gentleman is arguing, although he may not think he is arguing it, and he is perfectly entitled to ignore what he is arguing—it happens all the time in this place, it is absolutely standard, for Members on our Benches to make one argument and mean another—[Laughter.] Members on all of our Benches. Come on! Let’s not have the hypocrisy; we all know it is true.
It is absolutely true that we hear, on every side of the House, people making one argument and meaning another all the time. Today, the hon. Gentleman is making the argument for constitutional reform, but he actually means he is in favour of assisted dying. Again, that is a completely acceptable position, but it is not frank; it is not being straight with the House and it is not being straight with people.
All I ask on this is that, when we look down at the questions that have been raised and when we hear, for example, the voices of the disability groups, the various different medical groups and all the royal colleges, all of which rejected this Bill, and we say to them, “Look, we really must legislate at speed because there is a pressing need to do so,”—the hon. Member is really making the Mark Zuckerberg argument. He is making the “move fast and break things” argument.
Tom Tugendhat
I will not be giving way again. That is a perfectly acceptable argument for those who can afford to fail, but the problem is that the hon. Member is not dealing with the investment of a few people, which may or may not start a business or software company that fails or succeeds; he is playing with the lives of thousands, tens of thousands or hundreds of thousands of people.
Tom Tugendhat
I will not be giving way again. The hon. Member for Sunderland Central is instead saying that the role of democracy is to behave like the private interest group of a small cabal. I do not believe that is the case. I believe that the role of democracy is to measure, to weigh and to take matters slowly. If, on a matter of life and death, that is not the case, when are we supposed to be measured and take time?
Before people say that we had a long time in Committee, they should never forget that we start working on Government Bills years before—not weeks, not months, but years. Any of us who have introduced a Bill in this place know exactly what I mean. A Bill starts as an idea. It takes two years, normally, before it even gets to the Leader of the House and his various Bill committees, where we test, adjust and play with the Bill with the different Ministers, and the write-round process. The argument that that period of expertise, from Government, civil servants, lawyers, medical experts and all the others, can be replaced with a brief hearing in Committee is, I am afraid, simply not true.
Tom Tugendhat
The hon. Member may think it is long, but she really has no idea of time if that is her perception. The reality is that Government Bills take time because they have to be got right. This Bill is wrong. The only thing that stopped it was the Lords. If the hon. Member for Sunderland Central wants to abolish the Lords, that is fine, but if he could make that argument, I think we would all be a lot happier.
Daniel Francis (Bexleyheath and Crayford) (Lab)
It is a pleasure to serve under your chairship, Sir Edward. I thank my hon. Friend the Member for Sunderland Central (Lewis Atkinson) for his opening remarks. I am one of five Members in the room who were members of the Bill Committee, and I think I am the only one of those who voted against the assisted dying Bill on both Second Reading and Third Reading.
As Members know, I support the principles of the Bill, but I continue to have concerns about the issues of mental capacity and learning disability. I want to talk about the Bill that we sent to the other place. It should be remembered that the Bill we passed on Second Reading was not open to people with cancer, HIV or multiple sclerosis. It was not open to people under the definition of disability in the Equality Act 2010, which includes those three conditions. We had to put that right in Committee, because the original Bill was not open to people with cancer.
[Pete Wishart in the Chair]
In Committee we took evidence, and we accepted evidence from somebody who said, “Move to a panel situation.” However, that person also said to us, “Look at the law in Spain and how it treats the families of people with learning disabilities.” As a Committee, we decided to accept that person’s evidence on having a panel but disregard their evidence on the role of the families of people with learning disabilities.
It was clear that there was a cross-party whipping operation in place. Very early in the process, we saw that anyone from an opposition position, like me, had their amendments rejected. For example, my early amendments on learning disability were rejected. The Minister would stand up and say, “The Government advice is to reject these amendments,” and they would be rejected. However, as the public criticism grew, with my later amendments on learning disability, the same Minister would get up and say, “The Government’s position is to reject them,” and then vote in favour of them with the majority of the Committee. We ended up, against Government advice, accepting some amendments on learning disability but rejecting others, and that was the Bill that went to the Floor of the House.
I also note the comments from my hon. Friend the Member for Sunderland Central that he had advice from DHSC officials, because that advice was not given for my 26 amendments. It appears that advice was given to supporters of the Bill, but not to those who were against it. Those issues continue to concern me about the Bill that we sent to the other place.
We have heard a list of Members of the other place who tabled amendments, but we have not heard that the person who tabled the fourth highest number of amendments was the Bill’s sponsor in the other place. They tabled 6% of the amendments, 77 of them, to make the Bill stronger. The Bill that we said was the strongest possible Bill when we sent it to the other place had 77 amendments tabled by its sponsor.
Dr Opher
I thank my hon. Friend for giving way. He is making a very powerful speech. These types of debate are slightly triggering for some of us who were on the Committee. I have absolutely no problem with the House of Lords amending the legislation. In fact, that is its job. What it cannot do is simply block the legislation. I wonder what my hon. Friend thinks of that.
Daniel Francis
My view is that some Members most probably tabled too many amendments, but the Bill’s sponsor tabled 77.
Amendments 548A and 549A, which were not reached, would have undone the very measures that other Members and I sought for the learning disabled community. If they had come back to the Floor of the House, I can assure Members that I would have fought tooth and nail during the ping-pong process to ensure that they were not introduced. It is all well and good saying, “They talked it out,” but there were measures to undo what was accepted in Committee and on the Floor of the House to protect people with learning disabilities. I will continue to oppose those.
I would also say that the House of Lords Committee took evidence from a great number of royal colleges and disabled groups that we had not heard in Committee in the Commons, and it was that evidence that led to a number of Lords amendments.
Do I believe that the House of Lords needs reform? Yes, most probably it does, but we need a good, long, hard look, folks, at how we scrutinise in both Houses. There were 310 days between the Bill being sent to the House of Lords and Prorogation. Well, it took 327 days to deal with the Children’s Wellbeing and Schools Act 2026, and 347 days to deal with the Tobacco and Vapes Act 2026, so the situation is not unique to this Bill. It applies to Government Bills as well.
I will be very careful as the Leader of the House is here—I serve with him on the Modernisation Committee—but there is also an issue about how much time we spend scrutinising Bills in the Commons. In 2007-08, we spent 12.4 hours scrutinising Government Bills; we now spend less than eight hours before we send a Bill to the other place. We now spend 26% of our time on the Floor of the House scrutinising Government Bills.
There is a question for ourselves, folks. Is our priority having clips for social media or sending Bills to the other place in a proper manner? That is the question we should ask ourselves. I support the principles of the Bill, but I continue to believe it had issues that were not corrected. If it had come back during the ping-pong process, I would have opposed it, but there is a question we need to ask ourselves about reforming the other place and our own House.
Kit Malthouse (North West Hampshire) (Con)
I congratulate the hon. Member for Sunderland Central (Lewis Atkinson) on supporting this debate and pay my own tribute to Nat Dye and Sophie Blake, the sponsors of the petition. Over the last 10 years or so of campaigning on this issue and talking extensively about it, I have always been amazed at the number of dying people who give their final days, weeks and months to this campaign, determined that no one else should go through what they are going through. I watched with horror as peers tabled their 1,200th amendment, knowing that the clock for Nat, and indeed for Sophie, was ticking very loudly in their ears.
I am a Conservative, as I hope everybody knows, so I have a natural tendency to support our institutions and to understand the value of tradition. Hitherto, I had bought into the argument that the Lords was an eccentric but essential part of our democracy, that it brought an aspect to our legislative process that other countries lacked, and that the expertise it injected into our laws was valuable enough for us to tolerate its status within the constitution. However, the passage of the assisted dying Bill shocked me in a number of ways, to the extent that it has tugged in a profound way on a piece of wool in the constitutional jumper, as my right hon. Friend the Member for Tonbridge (Tom Tugendhat) said.
The Bill’s passage shocked me in three ways. I sat in on a lot of the debates and I watched even more on television. One of the things that really shocked me was the pretence at scrutiny. I am surprised that the Chair of the Treasury Committee and others have collaborated in the pretence that somehow a filibuster was not taking place. There were the repetitive speeches and endless amendments. We know that opponents were going around the House of Lords encouraging peers to table amendments to spread the air of suspicion. It was not just the odd one: there was the mandatory appearance in court and the increase in the number of doctors to five, alongside the pregnancy test and the travel ban. There were endless amendments that were specious and often openly cruel.
The second thing that really shocked me about the process was the disconnection of Members of the House of Lords from the wider population, and indeed from the number of our fellow citizens who find themselves in extremis and seeking relief from their pain. It was clear from what I am afraid was the casual cruelty in many of the speeches and amendments that those Members had just not sat down and talked with people, or spent time to understand the awful circumstances that so many of our citizens find themselves in.
The third thing that really shocked me—I profess to being ashamed at my ignorance; I had not realised this—was that the House of Lords has no rules. There is no orderly way in which it can be described as an orderly House; they basically make it up as they go along. As the hon. Member for Sutton and Cheam (Luke Taylor) said, we have operated on a rather gendered “good chap” model of trusting that they would do their job. However, it seems to me that the gentlemen’s agreement has run very short of gentlemen.
I saw the same thing again and again, Friday after Friday—let us not forget: in the demand for this scrutiny, the number of Fridays was increased very significantly, so that the Lords could do the job. A small cadre of peers were determined to block the Bill by any means—or by cheating, as Rod Liddle said. My right hon. Friend the Member for Tonbridge, and he is my friend, says that the House of Lords came to a position, but the point is that it was prevented from doing so. I would have accepted it if the House of Lords had voted against the Bill, and if Parliament had come to a decision and finished the task that it had been set by the British people. However, it did not. A small number of peers, some of whom had been specifically rejected by the electorate just a few weeks earlier, decided to block the Bill for God knows what reason.
I have three questions for the Leader of the House, who I am very pleased to see here. One of his duties, alongside liaising between the Government and the House of Commons, is the defence of this House, particularly our rights as Back Benchers to consider the question of mandate and conscience. First, if the Bill is reintroduced, will time be given for it to complete all its stages in this House during this Session? Secondly, can he confirm that the Parliament Act will remain the settled safety net that it has been in the past? That safety net exists not to force a result but to ensure that a question asked of the House of Lords has to be answered, rather than just being refused.
Thirdly, given that this wool has been tugged, will the Government commit to some public examination, such as through a royal commission, of our constitutional settlement? It has become clear that this issue, which seems to some people like a small abuse of the rules, is actually a domino undermining trust in our entire parliamentary structure. It has called into question whether a bicameral system with an unelected Chamber filled with appointees, pretty much all of whom are subject to the patronage of one Prime Minister or another, is really appropriate for our democracy.
Alison Bennett (Mid Sussex) (LD)
It is a pleasure to serve under your chairship, Mr Wishart. I really just want to make a single observation. I supported the assisted dying Bill. In looking at the motion for the e-petition today, I tried to imagine what would happen if the boot was on the other foot or if a future Parliament had a Government who were, as the hon. Member for Hackney South and Shoreditch (Dame Meg Hillier) said, “mad, bad or dangerous”.
To be frank, that reality may not be many years ahead of us and that Parliament might have a very different outlook on conscience issues from that of the current House of Commons. There might be a private Member’s Bill on a conscience issue that I profoundly opposed, but would I want the Lords to filibuster that Bill as they did just before Prorogation? If I am perfectly honest with myself, I suspect that I might if it were a conscience issue that I felt deeply opposed to.
However, Members should consider what the reaction would be to the filibustering of a conscience Bill that somebody like me might oppose. Remember that the Lords did not get to pass judgment on the assisted dying Bill. Imagine what would happen if such a future conscience Bill were filibustered and talked out, so that there was no vote on it in the House of Lords. Imagine the public reaction to that. Imagine what some political actors who are currently doing quite well in the national polls would do if that was what the House of Lords did.
Public trust in this place is already low, and public trust in politicians is through the floor. If we believe in democracy and in the primacy of the Commons, we cannot accept this situation for a Bill that I might support in the future, or one that I might profoundly oppose.
Mr Peter Bedford (Mid Leicestershire) (Con)
It is a pleasure to serve under your chairmanship, Mr Wishart, and I thank the hon. Member for Sunderland Central (Lewis Atkinson) for the impassioned way in which he opened this debate.
Last week, an article in The Spectator wrongly suggested that a co-sponsor of the Terminally Ill Adults (End of Life) Bill had softened his stance on getting assisted dying over the line. To my surprise, I was that very co-sponsor. Let me be absolutely clear to The Spectator and any journalists seeking to play games and misrepresent this sensitive issue that I continue to support the principle of a compassionate society helping those at the end of their lives to slip away peacefully and on their own terms.
I do so in part because of my own lived experience, having witnessed at first hand the cruelty that a terminal diagnosis can bring. I think back to the Christmas of 2019 at the dinner table with my late nan, who was unable to eat and in considerable pain. She turned to me and said simply that she was “ready to go”. Those words have never left me. They have forced me to confront some deeply uncomfortable truths: as a society, we too often shy away from death and in doing so we allow those whom we love the most to suffer for perhaps too long.
However, I am a pragmatist and a realist about parliamentary realities. I have concerns that if a similar private Member’s Bill were introduced in future, it would face the same filibustering in the House of Lords, even if a clear and absolute majority in the Commons voted for it on Third Reading.
As a Conservative, I value tradition, respect procedure and recognise that the conventions of this House—and indeed of the other place—are central to making our Parliament one of the finest democratic institutions in the world. However, as has been well established, Britain’s unwritten constitution provides the agility to modernise our procedures for the world we now live in, rather than our merely sticking by some of the more arcane procedures of times gone by. It was therefore disheartening to see the ability of a small number of peers to table quite literally hundreds of amendments to frustrate the democratic will of an absolute majority in the Commons.
I am well aware of “Erskine May” and I understand the historical precedents that allow for such tactics, but we must ask ourselves: do they show Parliament at its best? This place is at its best when real debates take place, and when arguments are made, tested and challenged. Even when I disagree about something, I recognise the quality of debate.
I listened carefully to the hon. Member for East Wiltshire (Danny Kruger) in the main Chamber; although I do not agree with his conclusions, I respect the clarity and conviction with which he made his case. In the other place, Baroness May set out her opposition in a similarly considered and coherent manner. On my own side of the argument, colleagues such as the hon. Member for Spen Valley (Kim Leadbeater) and my right hon. Friend the Member for North West Hampshire (Kit Malthouse) spoke with equal seriousness and compassion when they made their speeches. That is Parliament at its best.
Parliament is not at its best when Bills such as the assisted dying Bill are simply spoken out; it is not at its best when process replaces principles; and it is certainly not at its best when debate is prevented. The Bill, whatever one’s position on it, certainly did not lack scrutiny. It passed through the House with numerous amendments; each one was debated and voted on. It was considered for more than 100 hours in the Commons alone. That is longer than for most pieces of legislation, which often receive just a few hours of debate at the fag-end of a plethora of urgent questions or ministerial statements. And it was right that it received that attention.
Mr Bedford
No, I will carry on, because of time.
In the other place, 13 of the 14 allocated private Members’ Bills days were dedicated to the assisted dying Bill, so that amendments to it could be discussed fully and in a proper way. Yet despite all that, a select few Lords were able not simply to oppose the Bill but to shut down debate altogether. That should concern all of us.
Whatever side of the debate hon. Members are on, if we want our constituents to have confidence in our parliamentary democracy, we must ensure that the right to debate—the right to make considered decisions—is not lost to procedural dark arts. That is what the public expect of us, and it is what will ensure that this place continues to be one of the most respected democratic institutions in the world.
Liam Conlon (Beckenham and Penge) (Lab)
It is a pleasure to serve under your chairship, Mr Wishart.
I thank my hon. Friend the Member for Sunderland Central (Lewis Atkinson) for the way he opened this debate, recognising, as we all do, the different perspectives that are held. I also thank the petitioners.
When I first wrote to my constituents about the reasons why I voted against the Bill, I said that the debate was not one in which there were two sides, but rather multiple perspectives. Members and our constituents may have one view about the principle of assisted dying and another about the specific Bill that was put before us. Eighteen months on, they may have another view about whether Members in the other place were within their rights to scrutinise it as robustly as they did.
It is clear that everybody who engaged in the process has been motivated by a desire to reduce suffering. That was the driving force behind every vote, speech and amendment in both Houses during the time the Bill was before us, and the petition we are now discussing is no exception to that. The primacy of the House of Commons as the elected House is not in doubt, and it is right that there are robust constitutional conventions in place to protect it. But that does not mean that the work of the revising Chamber should be dismissed as illegitimate. To view its role as being little more than a rubber-stamping exercise would be to fail to recognise the value of challenge in our democracy.
The overwhelming public interest is not in Parliament doing its work as quickly as possible or without disagreement; it is in ensuring there is strong and workable legislation. The scrutiny of the Bill in both Houses was important and highlighted a number of significant concerns that have still not been resolved.
Lizzi Collinge
My hon. Friend is making some excellent points about the need for challenge, debate and quality in this place and the other place. Does he agree that it is a shame that the Lords did not have an opportunity to express their view on the Bill because we never got to the end of business?
Liam Conlon
It was a shame that it was timed out, but the amendments that were accepted through the scrutiny process were important and demonstrated the inadequacies of the Bill as it stood and the need for the process to continue.
It remains the case that no disability organisation or charity supported the Bill and none was confident that the safeguards would have adequately protected vulnerable people from being coerced or socially pressured into choosing a premature death.
From speaking to constituents, I know the importance of palliative care. I welcome the Government’s announcement last week and the extensive consultation with hospices into the future of palliative care. It is vital that the commitments we have made on palliative care are in no way derailed. I remain as concerned as ever that that would be the inevitable result of introducing assisted dying into our NHS without it being fully costed.
A number of issues were raised throughout the Committee process, and against that background, it would have been surprising if the Lords had not asked questions or tabled amendments. As all Members know, that is how answers are secured from the Bill’s sponsors and the Government, especially when the consequences of getting legislation wrong would be unimaginably devastating.
I will finish on the question raised by some Members, including from my own party, on what comes next and whether the Bill should be reintroduced. Two years ago, the British people elected a Labour Government because they wanted change. After years of economic stagnation, failing public services and declining trust in politics, they voted for a Government focused on raising living standards, rebuilding the NHS, delivering safer streets, expanding opportunity and driving economic growth. That is the promise on which I and others sought a mandate, and it is a promise that we must unite around and deliver.
Lewis Atkinson
My hon. Friend is making a considered speech, but he did point out that part of the issue is declining trust in politics. Whatever our individual views on this matter, does he not see that for the House of Commons—the elected Chamber—to reach a conclusion that is then blocked by the Lords risks further significantly undermining trust in politics and democratic institutions in this country?
Liam Conlon
It is fair to say that the point I made in response to an intervention earlier stands: there were amendments being tabled and accepted that demonstrated the inadequacies in the Bill, and that process should have been allowed to continue. I am supportive of reform to the House of Lords, but not of cutting short the scrutiny of a Bill that has such significant consequences on the matter of life and death.
Jim Shannon (Strangford) (DUP)
It is a real pleasure to serve under your chairship, Mr Wishart. I refer hon. Members to the 2019 report produced by the Constitution Committee, “The Legislative Process: The Passage of Bills Through Parliament”, which summarises well the roles each House of Parliament plays. It is instructive when considering this petition. I quote:
“The House of Commons usually addresses the policy and politics of bills, while the House of Lords tends to focus more of its scrutiny on the details and technicalities. This characterisation is not universal, but the complementarity of the broad approach of the two Houses is beneficial to the legislative scrutiny process.”
Similarly, “Erskine May” part 2, chapter 11, paragraph 11.4, concerning the rights and functions of the House of Lords, says:
“The House of Lords, as the unelected Chamber, recognises the primacy of the House of Commons. It does, however, retain substantial powers, particularly over legislation (see Part 4). The House uses its powers to legislate and to scrutinise primary and secondary legislation, to hold the Government to account, to investigate matters of public policy”.
My concern is that the petition emphasises the primacy of the Commons—which I wholly agree with—but neglects the function of the House of Lords in scrutinising legislation. Fundamentally, I am deeply troubled by the proposition that any Bill that passes this House, irrespective of its subject matter, should become law regardless of its flaws or the risk it may pose to the vulnerable. This is particularly so in the case of the assisted suicide Bill, which was not a manifesto commitment.
The House of Lords is constitutionally entitled to subject proposals to sustained scrutiny, arguably especially on a morally significant subject such as assisted suicide. The assisted suicide Bill was introduced as a private Member’s Bill, but it did not have the rigorous pre-legislative testing that Government Bills benefit from.
Jim Shannon
No.
That scrutiny cannot simply be a rubber stamp. If it is conceived of as a rubber stamp, that is a false understanding of what scrutiny entails. The Hansard Society has stated clearly during the previous Session that
“The House of Lords has the authority to reject, delay, or otherwise block the assisted dying bill.”
That myth needs dispelling.
The second myth that needs to be dispelled is the absurd accusation of the blocking or filibustering the assisted dying Bill by just a small handful of Lords. Amendments were tabled or co-signed by more than 90 peers, and some 140 peers with a range of views on the principle of assisted suicide expressed opposition to the Bill in the Lords, in the form of amendments, speaking in debates or Parliamentary questions. Some have pointed out that hundreds of amendments were tabled by a small number of peers, but it is important to note that dozens of other peers would have tabled the same amendments. It is a total fiction to suggest that opposition came from only a few—there were multiple peers involved.
I will tell hon. Members who those prominent peers were. They were lead signatories on these amendments because of their expertise. They included Baroness Grey-Thompson, who tabled amendments relating to disability—who has better knowledge than that lady? Baroness Finlay, a leading palliative care professor, tabled amendments on medical issues—again, her knowledge is significant. Lord Carlile KC, tabled amendments related to legal concerns. Had they not put their names to those amendments, countless others would have done so. They led on those amendments, and the fact that others did not add their names does not mean that they would not have done so in turn.
It is also important to understand that, having been sent to the Lords by this House, the Bill was scrutinised by three separate Committees: the House of Lords Constitution Committee, the Delegated Powers and Regulatory Reform Committee, and a Lords Select Committee. The Delegated Powers Committee was scathing about the skeletal nature of the Bill’s provisions, which included handing more than 40 sweeping, unspecified and unjustified powers to future Ministers to determine what assisted suicide under the Bill would actually look like.
The final myth, on which the petition partially rests, is that Lords scrutiny of a Bill should be rendered null due to public support for this particular proposal. That is an exceptionally flimsy argument and does not stand up to scrutiny. Putting aside the veracity of claims of 70% public support for the Bill, a recent multi-level regression and post-stratification poll found that, across the country, just 8% of the public would support pushing a non-manifesto commitment into law without approval and full scrutiny of both Houses of Parliament. The same poll found only 7% ranked it among their top three priorities for their MPs to focus on.
We should listen to our constituents. I always listen to my constituents, in Strangford. I suggest that others may need to do the same.
Dr Ellie Chowns (North Herefordshire) (Green)
Will the hon. Member give way?
Jim Shannon
No.
I understand the desire of those who support the Bill to see it enacted and perhaps even their disappointment and frustration that the Bill fell at the conclusion of the previous Session. However, to consider use of the Parliament Act to force through this specific, uncorrected, flawed version of the Bill would be foolhardy. A law that is bludgeoned on to the statute book is not one in which we could or should have confidence. I urge right hon. and hon. Members to consider this. I have a different opinion from some in this House, but I have a right to express my opinion on behalf of my constituents. I am doing that. The Leader of the House knows that I do it regularly in the House. I respect others and always have done, but I know one thing for certain—in this case, the procedures have been used correctly.
Andrew Ranger (Wrexham) (Lab)
It is a pleasure to serve under your chairmanship, Mr Wishart. I congratulate my hon. Friend the Member for Sunderland Central (Lewis Atkinson) on his opening speech and thank the petitioners for the hard work that they have done on this issue.
When I first came to this place, just short of two years ago, I came with a real zeal for reform of the second Chamber. Having said that, I believe—and it is important to say—that the House of Lords in its current form offers great value to our democracy. As has been said, unlike the way in which debates sometimes function in the Commons, the Lords has the capacity to discuss, scrutinise and add meaningful substance to the way in which our laws and legislation are made. Unfortunately, over the last parliamentary term, as we have been discussing today, a minority of peers conducted themselves in a way that has let down the Lords, undermined the way in which it functions and raised serious questions about the role that it should hold in the future, as well as public trust in the parliamentary process. As you can tell from that, Mr Wishart, my reforming zeal is still in place.
We need only look back through history to find examples of the Lords blocking progress. They range from, way back in 1909, Lloyd George’s people’s Budget, which looked at old age pensions and national insurance, to the equalisation of the age of consent in 2000 and the Hunting Act 2004, among others. In all those cases, the Lords sought to frustrate the will of the elected Chamber. Scrutiny is important—indeed, vital—to our Parliament. I do not think anyone on either side of the debate about the Terminally Ill Adults (End of Life) Bill would dispute that. But it became abundantly clear during the Lords process that to describe some of the contributions as scrutiny would be, at the very least, generous. There were speeches that were near identical in content and added nothing new to the debate, amendments tabled for the sake of amendments, and the use of egregious statements. One peer was quoted in The Times as saying that there were
“plenty of black arts that could be used to kill the bill off”,
and it is clear that that approach was pursued.
It is therefore not only ironic but factually untrue when we hear some opponents claim that the Bill received limited scrutiny. The facts do not support that. The Bill faced significant scrutiny—more than any private Member’s Bill in history and more than many other Bills—and that scrutiny began long before it reached the Lords. The Health and Social Care Committee inquiry had 68,000 responses from the public, more than 300 submissions of written evidence, two closed-door roundtable discussions and five oral evidence sessions, and reported in 2024. The Commons Bill Committee received evidence from 50 witnesses and 444 pieces of written evidence, and spent more than 100 hours scrutinising the Bill in 2025, as we heard. The House of Lords Committee, although weighted against assisted dying, with more opponents than supporters of the change, heard evidence from 43 witnesses.
The scrutiny was there. It happened. Ultimately, the fall of the Bill represents the frustration of a decision made by the democratic Chamber of this country. The elected House voted for the legislation. The public, when asked consistently over many years, have supported it. I have been clear that I will support, in whatever way I can, the effort to ensure that the Bill is given its rightful passage through both Houses of Parliament and becomes law, as is the will of the elected Chamber and the will of the majority of the public. That is vital to restore badly needed trust in our political process. I hope that my right hon. Friend the Leader of the House will be able to expand on how that can progress.
Claire Young (Thornbury and Yate) (LD)
It is a pleasure to serve under your chairship, Mr Wishart. I thank the petitioners who provoked the debate.
I agree with the hon. Member for Hackney South and Shoreditch (Dame Meg Hillier) on one important point: there are benefits of having a revising Chamber. However, I believe that the proper duty of the Lords is to scrutinise, improve and revise, not to block or frustrate. That distinction matters most of all in the case of private Members’ Bills, which proceed with limited time allocated to them and, for conscience issues, without a whipped vote.
When our constituents send us to this place, they trust that we will apply our judgment to serious matters carefully and thoughtfully, and while taking their views into account. I certainly tried to take that approach when I voted on the assisted dying Bill, as, I believe, did Members on both sides of the House, regardless of the view that they took. When we consider the time spent scrutinising the Bill, which a number of Members have mentioned, we should not overlook the time that individual MPs committed to learning, researching and listening. I suspect that it was far more than is typical for a Bill that emanates from a manifesto.
The questions on the Terminally Ill Adults (End of Life) Bill were among the most difficult and personal to come before us in Parliament, yet in debates on the Bill, I saw the House at its very best. There was careful argument, deep feeling and genuine respect among Members who profoundly disagreed. What followed did not reflect the same spirit. In the other place, the Bill fell not because peers had weighed it up and rejected it, but because its passage was run down by delay, by more than 1,000 amendments and by a refusal to let the elected House reach its conclusion. The clock was allowed to defeat what a vote could not. I cannot accept that an unelected Chamber should be able to set aside the settled will of the elected Chamber simply by running down the time.
It is precisely because of such episodes that I support a wholly elected second Chamber, as I have for many years—I, for one, am not relying on this specific petition to decide my view. An unelected House should not hold the power to block a Bill that commands a majority in the elected House. The Government’s removal of hereditary peers was a welcome step but, as I have said before, they too often tinker at the edges when our constitution needs fundamental reform. That reform will never be completed if an unelected Chamber can override the wishes of the people whom the public chose. In plain terms, that is undemocratic.
The petition, which was signed by more than 114,000 of our fellow citizens, is just the latest evidence that the public will no longer accept an unelected few standing in the way of the elected many. I commend the petitioners and urge the Government to introduce the reform that this moment so clearly demands.
Ashley Dalton (West Lancashire) (Lab)
It is a pleasure to serve under your chairmanship, Mr Wishart. I thank the petitioners for giving us the opportunity to have this debate.
I know that we are all mindful of the sincere and strongly held views that led to the submission of the petition. The previous Session’s debates on the Terminally Ill Adults (End of Life) Bill were, in both Houses, consistently heartfelt and moving, with people on both sides of the argument often speaking from real, difficult experience. The debates also provided many people outside Parliament with a chance to talk—in many cases, for the first time—about the reality of death and dying, and what compassionate and respectful care should look like as people move towards the end of their lives.
As some hon. Members will know, I have actual, first-hand experience of being given a terminal diagnosis. I have stage 4, incurable breast cancer myself, so this is not an abstract debate for me either. Like all of us, I am going to die. However, my diagnosis means that I know what is most likely to kill me, and without the intervention of medical science, it would be killing me a damn sight sooner than it currently is. That does not necessarily give me any more wisdom, but it perhaps gives me a certain clarity on the issue of end-of-life care.
One thing that I am very pleased has emerged from the debate is that the state of palliative care is now firmly at the heart of the political agenda. Whatever our different views on the Bill, I hope that the passion of both sides will serve as a clear, united call for better, more accessible care for everyone. I do not think there is similar consensus on the proposal we are debating today. Proper parliamentary scrutiny of the laws before us is one of the most important safeguards—perhaps the most important safeguard—in our constitution.
Our democracy is not a matter of ensuring that legislation reaches the statute book as quickly as possible. That was not why we or our colleagues in the other place were given the privilege of serving in Parliament. It is not why every single one of us takes so much care over our decisions, speeches and the causes we champion, or why we sit late into the night to ensure that every voice is heard. As time-consuming and as uncomfortable as it can sometimes be, our legislative process was deliberately designed to allow opportunities for challenge, scrutiny and improvement. They are a feature, not a bug.
The petition argues that if MPs vote for a Bill and opinion polls suggest public support for its principle, the Government should use their powers to ensure that the Bill progresses. I disagree. Parliament’s role is to pass the best possible legislation, not to vote on a principle and let the detail work itself out later. Sometimes our work begins with campaigning but, ultimately, we are legislators dealing with detail and specifics. MPs, peers and Ministers share a responsibility to uphold the integrity of Parliament not as a matter of dry academic principle, but because bad legislation has truly terrible consequences.
Ashley Dalton
I will not; there is not enough time.
Once we begin asking Governments to override democratic protocols or decide that the revising Chamber’s scrutiny should be optional, we create a precedent. Constitutional principles must apply consistently. We have our constitutional arrangements because it is our responsibility to consider not only the outcomes we want today, but the outcomes we might not want tomorrow.
The petition is specifically about the role of the House of Lords. In my time as a Minister, it was a great honour to work alongside Members from the red Benches as well as the green. Peers are our colleagues, not our enemies or rivals. The Lords, as an institution, has made a vast contribution to the work and reputation of our Parliament. There is no doubt whatsoever about the primacy of the elected House, which is why peers do not vote against legislation that secured a mandate from the public because it was in a Government’s manifesto. In fact, they rarely vote against legislation at all—as we have heard, they did not vote against the Bill. Still, however, the House of Commons is not sovereign—our Parliament is. Our Parliament is a trinity of the Commons, the Lords and the Crown, and each has a distinct and critical role to play.
We cannot believe that a piece of legislation is serious and important, but also demand a weaker and worse process for passing it. I am also cautious about relying too heavily on opinion polls as a justification for altering parliamentary processes. Public opinion matters enormously, of course, but polls can be crude instruments. Governing involves more than simply measuring public sentiment at a particular moment in time. If supporters of a Bill are confident in its merits, they should welcome scrutiny. Good legislation survives challenge. Strong arguments withstand examination. Many laws emerge better because difficult questions were asked during their passage through Parliament, including by the experts in the revising Chamber.
Ultimately, this debate is not about whether one supports or opposes a particular Bill; it is about what kind of parliamentary system we want. Do we want a Parliament that carefully examines legislation, especially that dealing with matters of profound social change, or do we want one in which surface popularity becomes a reason to accelerate the legislative process and reduce opportunities for scrutiny? I believe that we do not.
Pippa Heylings (South Cambridgeshire) (LD)
It is a pleasure to serve under your chairship, Mr Wishart. I congratulate the petitioners on their resilience not just this evening, but over time. I also congratulate the hon. Member for Sunderland Central (Lewis Atkinson) on the excellent way in which he put across the central tenets of the petition and our debate, which I think has been misrepresented by several Members, unfortunately.
I am grateful to the hundreds of constituents who wrote to me over the course of the debates on the Terminally Ill Adults (End of Life) Bill to share their views and perspectives. I pay tribute to all those who provided compelling, powerful and emotive evidence on, and personal testimony to, what they thought should be the choice available to people with a terminal diagnosis in their dying days.
This is also personal to me. I have long held with the principle of assisted dying, but I have had long, deep conversations with my husband over the last couple of years about the choices he would like available to him if and when his leukaemia eventually becomes terminal. I know which choices he would want to be available.
The Bill had well over 175 hours of scrutiny in both Houses, and that followed the Health and Social Care Committee hearing evidence and expert testimony on assisted dying and assisted suicide—18 months-worth in 2023-24, before the private Member’s Bill was introduced—to determine how such a Bill could be acceptable to the legislature and the public, so there was plenty of evidence, testimony and analysis before the private Member’s Bill came forward. After all that, a principle is clear to me and many constituents: legislation should succeed or fail because our elected body in Parliament has reached a decision on it—it has primacy.
The House of Lords does indeed have a role in scrutinising Bills that come before Parliament, but it works through conventions, such as self-regulation. Earlier, the Chair set a strict speaking time for today’s debate so that every single one of us could have the chance to make our points, and also to ensure that we had a timely discussion and a conclusion to the debate. That does not happen in the House of Lords because of self-regulation. The Lord Speaker also does not group amendments to make sure that there is timely progression of the proceedings. That, ultimately—because the process was abused—failed both Houses, democracy itself and faith in democracy, because the House of Lords did not allow the Bill to be returned to the Commons in time for further decision.
No matter one’s view of the Bill, I believe, like many constituents and the petitioners, that Parliament should determine the fate of any Bill. I therefore ask the Leader of the House if he will seriously consider the reform that is now needed of the procedures for the timely passage of Bills through Parliament, and his view of the relationship between both Houses and the fact that we can no longer have an unelected House of Lords that frustrates the will of the House of Commons.
Jim Allister (North Antrim) (TUV)
When the hon. Member for Sunderland Central (Lewis Atkinson) introduced the debate, he said that it was not about the assisted dying Bill; he proceeded for the next 25 minutes to talk about little else. It is quite clear that many of that Bill’s supporters, out of a sense of churlish resentment of the House of Lords daring to do its job, have come today to give vent to that view. Of course, for some of them, it dovetails with their aversion to the very existence of the House of Lords in the first place.
In the most compelling and effective speech that we have heard, the hon. Member for West Lancashire (Ashley Dalton) pointed out that when we talk about parliamentary democracy, we do not have the luxury of just talking about the House of Commons. Ours is a bicameral situation—we have an elected House of Commons and a House of Lords, and both have an essential and irrefutable function in passing the laws of our land. That is a fundamental component of our parliamentary democracy. It might cause some to resent the existence of the other House, but it is the reality. Just as we, as Members of this House, are entitled to have our say and to vote as we please, Members of the House of Lords, so long as they exist, have the same right to express themselves, and to move, speak to, and ultimately, if they ever get to the end of the process, vote on amendments. That is how that place works, for better or for worse.
I suspect that if we had a Reform or a Conservative Government in two or three years’ time who decided to extract the United Kingdom from the European convention on human rights, the very people complaining the loudest today about the functioning of the House of Lords would be cheering it on as it attempted to filibuster that. We need to dissect their argument and discover that it is not quite as altruistic as some would have us believe; there is a lot more self-interest at play. The complaint amounts to a desire to have an unsafe Bill forced into law—that is the real complaint. Of course, it is the function of the House of Lords to apply rigour and scrutiny. I salute the Lords for the rigour that it supplies, and the many notable peers with expertise on these issues far beyond that of anyone in this Chamber. [Interruption.]
Jim Allister
Was it not so obvious that not a single royal society of experts supported this Bill, just as not a single Member of this House was elected on a manifesto to support it? Yet we have this cry that it should be railroaded through—where is the democracy in that?
We hear this audacious demand to use the Parliament Act, which has never been used for a private Member’s Bill and is only ever used for Government Bills, to ram the Bill through. If we take scrutiny seriously, we must not bring Parliament into disrepute. Passing a flawed Bill that allows the state and doctors to end vulnerable lives would most certainly bring Parliament into disrepute. This was a Bill riddled with flaws—my goodness, look at what the Delegated Powers and Regulatory Reform Committee said—[Interruption.]
Pete Wishart (in the Chair)
Order. This has been a very good-natured debate and we have allowed everybody to be heard. Mr Allister expects the same courtesy.
Jim Allister
Thank you for your protection, Mr Wishart. I was not certain that I needed it, but I am very glad to have it none the less.
This was a Bill so eminently flawed that the Delegated Powers and Regulatory Reform Committee eviscerated it, saying that it relied so much on delegated legislation that proper scrutiny was difficult. It was a shell of a Bill to give future Ministers the right to make all sorts of life-and-death decisions on this most critical issue—supposedly one of conscience. It was an appallingly flawed piece of legislation, demonstrated by the number of amendments that had to be moved by its own supporters and the number that then had to be counteracted by its supporters in the House of Lords. The thing was a farce, and the House of Lords did it a great service by putting it out of its misery.
Lisa Smart (Hazel Grove) (LD)
It is a pleasure to serve with you in the Chair, Mr Wishart.
We have heard compelling and passionate arguments from across the Chamber about the Terminally Ill Adults (End of Life) Bill and its progress—or lack of progress—through Parliament. This is a really important topic. It generates strong feelings and absolute clarity of thought from some, but it really should require nuance and understanding from us all. We should be able to agree that the other place has a vital role to play in the scrutiny of legislation, but also that when elected MPs vote for a Bill and the public back it, it should be able to become law.
The petition we are debating was signed by more than 114,000 people across the country, including 214 of my constituents in Hazel Grove. Hundreds of my constituents, on both sides of the assisted dying debate, wrote to me, and I am grateful to each of them for the time they took to do that. Their participation, whether by signing parliamentary petitions or writing to their MP, matters. It highlights that so many people are paying attention. I particularly welcome the petitioners in the Public Gallery this evening.
The fact that so many people signed the petition, many of them from constituencies whose MPs hold very different views on the legislation that prompted it, shows that this is not only about one Bill; it is about something bigger. When a Bill is prevented from passing through Parliament by the House of Lords, it is not just scrutiny. The lack of progress for the Terminally Ill Adults (End of Life) Bill highlighted once again the many issues with the other place. From the Peter Mandelson scandal to the reports in The Guardian of 15 peers having claimed over £500,000 in expenses while not speaking in a single Lords debate, it is clear that we should be implementing meaningful reforms. As Tom Brake, a former Member of this House and now the director of Unlock Democracy, was quoted by the hon. Member for Sunderland Central (Lewis Atkinson) as saying, the case for reform of the other place has been strengthened by this debate.
The Modernisation Committee was established to examine how this House uses its time and how our procedures can better serve democracy. Directly relevant to this debate, it has already opened inquiries into how Backbench Business Committee and Petitions Committee debates are conducted. The Liberal Democrats would welcome an evaluation of the constitutional relationship between the two Houses, and of whether a Chamber that is not elected should be able to override one that is. The Liberal Democrats have argued for decades that the House of Lords needs to be replaced with a fully elected second Chamber with a proper democratic mandate, elected by proportional representation, so that every region, nation and community has a genuine voice. I welcome some of the new travellers on the path to that cause who have outed themselves this afternoon. Those who make the law should be accountable to those who must live by it.
We on the Lib Dem Benches welcome the House of Lords (Hereditary Peers) Act 2026, which removed the remaining hereditary peers. Although it is pretty timid and tightly written, it was long overdue. However, removing those peers from being legislators for life is not enough and cannot be called truly meaningful Lords reform. Having a Chamber that remained unelected, still shaped by prime ministerial patronage and capable of blocking the will of this House, felt wholly unsatisfactory in the last century, never mind this one.
I agree strongly with the hon. Members for Stroud (Dr Opher) and for Hammersmith and Chiswick (Andy Slaughter), my hon. Friend the Member for Thornbury and Yate (Claire Young) and the right hon. Member for Sutton Coldfield (Sir Andrew Mitchell), but the speech of the afternoon was made by my hon. Friend the Member for Mid Sussex (Alison Bennett). She gave a belter of a speech about the importance of trust in politics and the role we all have to play in maintaining that for our constituents.
The Government have announced a removal of peerages Bill, which I welcome as a step in the right direction, albeit another tiny and timid step that fails to rise sufficiently to the moment. There remains an untaken opportunity to deliver long overdue reform of the other place. My Liberal Democrat colleagues and I stand ready to play our part, and we urge the Government to show the same resolve.
John Lamont (Berwickshire, Roxburgh and Selkirk) (Con)
It is a pleasure to serve with you in the Chair, Mr Wishart.
I begin by congratulating the hon. Member for Sunderland Central (Lewis Atkinson), my colleague on the Petitions Committee, for introducing the debate on behalf of the Committee and the petitioner. I thank the more than 100,000 people who signed the e-petition. Whatever view Members take on the arguments advanced in the petition, the number of signatures demonstrates the strength of feeling on this issue and the importance of Parliament’s engaging seriously with those concerns. I also thank all Members who have contributed to the debate. We have heard thoughtful and strongly held views from across the House, reflecting both the significance of the legislation that prompted the petition and the wider constitutional questions now before us.
It is important to recognise that the petition arose from concerns about the progress of the Terminally Ill Adults (End of Life) Bill, a private member’s Bill. However, today’s debate ultimately is not about the merits of assisted dying; it is about parliamentary process. Specifically, it is about whether Parliament should change the way that it approaches legislation where a private Member’s Bill has secured support from MPs. The petition argues, in essence, that where a private Member’s Bill has support from MPs and the public, the Government should do everything within their power to ensure that it has sufficient time to complete all its parliamentary stages.
It is sometimes overlooked that that is not simply a request for more parliamentary time. It is effectively a request for a new constitutional principle: that where the concepts underlying a private Member’s Bill have secured sufficient public support and a Commons majority, the Government should take active steps to ensure the Bill’s passage despite significant unresolved issues. That would represent a significant departure from our existing constitutional arrangements, under which scrutiny, amendment and even failure remain possible outcomes of the legislative process. I do not believe that public support, however significant—particularly as measured by polls, rather than at the ballot box—can be a substitute for proper parliamentary scrutiny. Parliament’s role is not simply to facilitate legislation but to examine it, challenge it and improve it before it becomes law.
The petition also raises questions about the role of the House of Lords. It is important that we approach those questions accurately. Some have suggested that the Lords somehow acted improperly by failing to return the Bill Terminally Ill Adults (End of Life) Bill to the Commons. That assertion is not supported by the constitutional authorities.
Sir John Hayes (South Holland and The Deepings) (Con)
I have not participated in the debate because I was not able to be here at the beginning, but I heard many of the speeches. In a number of them, it was suggested that the Bill received unusual levels of consideration. That is simply not so. Many of us have been in this House for a very long time and have seen legislation that has had pre-legislative scrutiny in both Houses, and independent reports commissioned on it, long before Second Reading. This Bill had none of that.
John Lamont
I am grateful for my right hon. Friend’s insight from his many years of experience in this place. We are not a unicameral system. As the hon. Member for West Lancashire (Ashley Dalton) stated in her powerful speech, Parliament consists of three separate parts: the House of Commons, the House of Lords and the Crown. The House of Lords is independent and shares the task of making and shaping laws. The House of Lords Constitution Committee made it clear that it was constitutionally appropriate for the Lords to scrutinise, amend or reject the Bill, and the Hansard Society similarly confirmed that the Lords
“has the authority to reject, delay, or otherwise block”
legislation of its kind.
Dr Chowns
Does the hon. Member not recognise the fundamental problem that the House of Lords has not had the chance to approve or reject this piece of legislation because it has never come to a vote? The House of Lords has therefore not fulfilled its constitutional responsibility to fully scrutinise the legislation. Would it not be appropriate for this House to send the Bill back to the House of Lords until it does fulfil its constitutional responsibility to complete scrutiny with a vote?
John Lamont
I am grateful for that point but, as other hon. Members have made clear in this debate, the House of Lords did not vote because that is part of its process of scrutinising. The Lords was performing the role that it is constitutionally required to perform.
The Bill in question was not a Government Bill and not a manifesto commitment. A deliberate choice was made by the Prime Minister to take an approach that did not put the policy, or even the promise of a free vote, before the electorate. As we heard from my hon. Friend the Member for Dumfries and Galloway (John Cooper), the Salisbury-Addison convention reflects the principle that the House of Lords should not frustrate legislation that gives effect to commitments on which the electorate have conferred a democratic mandate. As Viscount Cranborne spelled out at the time,
“it would be constitutionally wrong, when the country has so recently expressed its view, for this House to oppose proposals which have been definitely put before the electorate.”—[Official Report, House of Lords, 16 August 1945; Vol. 137, c. 47.]
Kit Malthouse
I am slightly intrigued by my hon. Friend’s approach. In the election, I stood on a personal pledge that I would support assisted dying, having voted for it before, in 2015. In my hon. Friend’s view, what importance should we attach to an absolute majority of the House of Commons? The assisted dying Bill passed with an absolute majority of all eligible Members, not counting Speakers and others, who could vote. What he is essentially saying is that that is just an ordinary part of the process, rather than what it should be in a democracy, which is decisive.
John Lamont
The House of Commons expressed its view. The Bill then went to the House of Lords for further consideration. I know from conversations with a number of MP colleagues that they supported the principle of the Bill to allow it to progress, so that the House of Lords could look at it further and in the hope that improvements would be made. I reflect on what happened in the Scottish Parliament, where a similar Bill achieved the support of MSPs at the first stage. After it received further scrutiny and further amendments, it went back to the Scottish Parliament, and it was rejected—[Interruption.]
John Lamont
That was because amendments could not be secured to satisfy people's concerns.
This was a private Member’s Bill. In such circumstances, there was no constitutional obligation on the Lords—as I stated earlier in relation to the Salisbury convention—to ensure that it completed its passage through Parliament. Indeed, it is worth remembering that the vast majority of private Member’s Bills do not become law. That is not a constitutional failure; it is a long-standing feature of our parliamentary system.
Similarly, scrutiny should not be confused with obstruction. One reason why many peers believed that further scrutiny was necessary was that significant issues remained unresolved after the Bill left the House of Commons. More than 500 amendments had been tabled during Public Bill Committee, but only a small proportion not supported by the sponsor were accepted. On Report, 88 amendments were deemed in order, but only seven were selected for debate and decision by the House as a whole. That was the wrong approach to take.
The breadth of concerns, underpinned by expert testimony, should have prompted deep reflection on what more needed to be amended. The Cabinet Office’s guide to making legislation is very clear: if a private Member’s Bill is to make it on to the statute books,
“As far as possible, amendments should be made at Committee Stage in the first House.”
It is therefore hardly surprising that many peers concluded that further scrutiny was required. Indeed, several Members indicated during proceedings in the Commons that they expected the Lords to undertake detailed scrutiny and improve the legislation where necessary. The Lords therefore performed precisely the role that many MPs expected it to perform.
It is also important to recognise that the nature of the concerns that were raised. This was not simply a handful of peers attempting to delay legislation; more than 140 peers expressed opposition to, or serious concerns about, the Bill. Those concerns came from individuals with substantial expertise, including former leaders of the medical profession, senior NHS figures, specialists in psychiatry and palliative care, legal experts and representatives of vulnerable groups. Whether one agreed with their conclusions or not, those concerns deserved careful consideration. That is exactly what parliamentary scrutiny is intended to achieve.
Some supporters of the petition have pointed to opinion polling as evidence that Parliament should ensure legislation progresses. Public opinion is, of course, important, and Members of this House are elected to represent the people who send us here, but our constitutional system has never operated on the basis that polling alone determines whether legislation becomes law. Parliament is a representative democracy, not a system of government by opinion survey. Members of both Houses are expected to exercise judgment, consider evidence, scrutinise proposals and weigh consequences. If legislation were to acquire a special constitutional status simply because it polled well, we would fundamentally alter the balance between public opinion and parliamentary scrutiny. That would be a profound constitutional change, and it should not be undertaken lightly.
John Lamont
I am short on time, so I will not take any more interventions.
I thank again those who signed the petition and all those who have contributed to today’s debate. Although there will undoubtedly remain differences of opinion on the specific legislation that gave rise to this petition, I hope there can be broad agreement on one fundamental point: democratic legitimacy and parliamentary scrutiny are not competing principles—they are complementary principles. Public support and votes in Parliament matter, but scrutiny matters too. The lesson we should draw from this debate is not that scrutiny prevented democracy from working, but that scrutiny is democracy working.
The House of Lords acted within its constitutional role. The concerns of experts were heard, amendments were tested and evidence was examined. Whether one supported or opposed the legislation itself, that is exactly how Parliament is supposed to function. Parliament best serves the public not when it rushes legislation through, but when it takes seriously its duty to examine, improve and—where necessary—challenge legislation before it becomes law. That is how we protect the integrity of our legislative process, preserve public confidence in Parliament, and ultimately make better laws for the people who we are elected to serve.
The Leader of the House of Commons (Sir Alan Campbell)
It is a pleasure to serve under your chairmanship, Mr Wishart, and I thank the Father of the House, the right hon. Member for Gainsborough (Sir Edward Leigh), for chairing the debate earlier.
I thank the petitioners for their hard work and the Petitions Committee for scheduling this debate, and I thank all the Members who have taken part. This has been a well-attended debate and it makes the case, dare I say it, for petitions to be heard in the main Chamber. However, that is another discussion.
Let me say at the outset that I understand the strength of feeling on this issue and appreciate some of the frustration that has come across this afternoon. I thank my hon. Friend the Member for Sunderland Central (Lewis Atkinson) for the way in which he introduced the debate on behalf of the Petitions Committee. I am also grateful to the right hon. Member for Sutton Coldfield (Sir Andrew Mitchell) for reminding me of my duties and responsibilities in this place. I make no apology for saying that those are absolutely what I endeavour to carry out on any issue at any time. I am genuinely grateful for the opportunity to listen to the debate and to respond, but given the role I play, I make no apology if I say some unpalatable things. The problem, with an issue of such importance and such division, is that what I have to say will probably end up being unpalatable to both sides, not just one.
There are two interrelated elements to this petition and, subsequently, to this debate: first, the principles surrounding the role of each House and, secondly, the passage of the Terminally Ill Adults (End of Life) Bill. I will begin by dealing with the first, which is the primacy of the Commons. The primacy of the elected chamber, the House of Commons, and the way in which it has primacy over the House of Lords, is absolutely fundamental to our constitution. It is reflected in the legislation and the conventions that govern how Parliament works. For instance, the Parliament Acts 1911 and 1949 reduced and then further reduced the ability of the House of Lords to delay legislation against the will of the Commons. Since its passage, the Parliament Act 1949 has limited the ability of the Lords to delay the will of the Commons to just one year, and I can confirm that that applies to all Public Bills, including private Members’ Bills, as my hon. Friend the Member for Sunderland Central said.
The Government’s democratic mandate and the primacy of the Commons are also reflected in the Salisbury-Addison convention that the House of Lords should not reject on Second Reading any Government legislation that carries out a manifesto commitment and that such legislation will not be subject to “wrecking amendments” in its passage. However, the key fact is that the Terminally Ill Adults (End of Life) Bill was a private Member’s Bill and therefore, unlike the Parliament Act 1949, the Salisbury-Addison convention did not apply.
The will of the Commons is given precedence over the will of the Lords. However, I want to place on record the Government’s view that we greatly value the work of the House of Lords in scrutinising and improving legislation. There have been many occasions where the Members of the other place have drawn on their experience and expertise in their field—whether that is law, science, public service, military matters or indeed medicine—to bring a depth of scrutiny to legislation that sometimes the Commons is unable to.
A great deal of legislation is significantly improved because of the patient, rigorous work done in the Lords, and the Government do not have any plans to further curtail the ability of the Lords to scrutinise legislation passed on by the Commons. It seems to me that it is for the Lords to decide what their rules are, and even if the Government set about trying to change the rules, they do not have a majority in the House of Lords. We need to bear that in mind.
But—it is a very big “but”—there clearly needs to be a balance between how scrutiny takes place and how rules and conventions are respected. History shows that where the House of Lords overrides the expressed will of the elected House and is considered to be preventing legislation from completing its stages, pressure builds to revisit those rules and conventions—that is one of the first and last times I think I will ever have agreed with Tom Brake. [Laughter.]
I want to turn to the Terminally Ill Adults (End of Life) Bill. I will not rerun the Bill, its progress and who was right or wrong, but it remains an issue of profound ethical and personal importance to many. As is the convention for matters of conscience, the Government maintained a neutral position throughout the passage of the Bill, except to ensure that, should it have passed, they would assist to make it workable. That position has not changed. All MPs and peers, including Government Ministers, will have had their own personal views, and it is right that, as MPs, we had a free vote on the Bill. On two occasions—on Second Reading, by a majority of 55, and on Third Reading, by a majority of 23—the Commons, including myself, supported the legislation.
In the Commons, the Bill received over 500 amendments and, as we have heard, was in Committee for something like 100 hours. Many of those amendments were agreed to. In the Lords, there were more than 1,200 amendments. There are some key differences, of course, in the way the two Houses can deal with those hundreds of amendments, but I suggest that some Members of the Lords who spent their time putting down amendment after amendment and urging that they be debated genuinely believed that the Bill that left the Commons was not of merit and was flawed. They have a right to scrutinise legislation, and they used that right. I heard some of the examples that were given of some of the amendments, which quite frankly ran the risk of making the process rather farcical, but there were many others that were genuine and sincere attempts to make the Bill right.
Behind all this is an issue that is central to private Members’ Bills: the question of time. Unless rules on private Members’ Bills change, any private Member’s Bill—whether in the House of Commons or the House of Lords—can be timed out because it is simply talked out. The right hon. Member for North West Hampshire (Kit Malthouse) said, in retrospect, shouldn’t the House of Commons and the Government have made time for this? I remind him that there was time in the House of Commons—the Bill passed there. It was not in the House of Commons that we had the problem; it was in the House of Lords.
However, it is a matter for the Lords themselves, where the Bill had 90 hours and 45 minutes of debate. As a private Member’s Bill both in the Commons and the Lords, it is to a large extent the Bill’s sponsors who decide how that time should be used. As in the Commons stage, that time was allocated and used in such a way in the Lords. It took a very long time in Committee in the House of Commons, and it took quite a long time on Report in the House of Commons. That was time that might otherwise have created some space later in the process, which the Lords might have been able to make better use. However, I suspect that I am being slightly optimistic when I say that.
Daniel Francis
I have sat on a Committee for a private Member’s Bill that took 45 minutes, and I sat on the Terminally Ill Adults (End of Life) Bill Committee, which took 100 hours. With an issue like this, we need to look at how the private Members’ Bill process works. As Committee members, we were expected to receive 242 pieces of written evidence and 159 pieces of written correspondence the day before line-by-line scrutiny commenced. We also had no equality impact assessment, human rights assessment or delegated powers memorandum throughout the entire Committee process. All I would ask is that, for these larger, more contentious Bills, we go away and look at how the private Members’ Bill process works.
Sir Alan Campbell
I certainly will go away and reflect on that, but as my hon. Friend knows, because he is a very distinguished member of the Modernisation Committee, we are looking at how the House of Commons should best use its time. Part of that discussion will relate to when private Members’ Bills are debated and how long they are debated for. He will know that a number of Commons Committees have looked at this question over a period of time—not least the Procedure Committee, which, if memory serves, is looking at it again.
However, limited time is available for private Members’ Bills. There might be a clear decision at the end of a debate—on a time-limited Second Reading, for example, although that would be novel, given that the aim is often to get to 2.30 pm having talked out a Bill, and sometimes the Government of the day help in that process [Interruption.] They do; that is part of how private Members’ Bills are dealt with. The more I look at the issue, the less I am sure whether they are necessarily fit for purpose.
However, if we were to get to that point, that would not address the issue raised by my hon. Friend the Member for Bexleyheath and Crayford (Daniel Francis) about how long the House should take to consider these matters. This House rose to the occasion on Second Reading—recall the great fear that there would be a great row, which would show the House at its worst. The House rose to that occasion, but we had at least five hours of debate on Second Reading, so I worry slightly about what would happen if the process were curtailed.
At the heart of the issue, although I am not commenting on the Bill in this context, is the fact that Members need to reflect on whether a private Member’s Bill is the route for certain legislation, particularly when it concerns a big issue and there is a question of conscience.
Kit Malthouse
I understand the point that the Leader of the House is making. However, if the House of Commons is determined that even a private Member’s Bill should go through, even in the face of a Government-attempted filibuster, does he agree that it has tools at its disposal to allow it to do so? As he will remember, even in the assisted dying debate, we had to move that the Question now be put. If the House of Commons, in convocation, has the majority to override the Government, it can do so, even in those circumstances. What we have found is that in the Lords that is not the case.
Sir Alan Campbell
That is the case in the Commons. I am trying to recall Second Reading, but I assume that is what happened. If there is a majority in favour of a Bill and a motion to bring the debate to an end, that motion will succeed—it does not matter what the Government of the day say. I was talking about other Bills that the Government might dispute, rather than distinctly private Members’ Bills where there is a matter of conscience and a free vote.
The right hon. Member for North West Hampshire is drawing out the contrast, and there is a wider debate about how the House of Lords conducts its business. As I have said before, at the end of the day if the House of Lords to carry out independent scrutiny, it is not for the Government of the day to set those rules. It might be for them to look at an issue in the context of the Parliament Act, for example, but it is not for them to set the day-to-day rules. Unless the Government had a majority in the House of Lords, they would not be able to do that.
Tom Tugendhat
The right hon. Gentleman is making the entirely valid point that democracy is not just what happens in either Chamber, whether it is the Lords or the Commons, and democracy cannot be reduced to a number, whether it is an electoral number at a general election or a number in the Chamber. Democracy is what we do between times.
I keep hearing that we Conservatives had 14 years in government—I do not deny that, and I recognise many of the errors that we made. But is it not also true that there were 10 years between the first and second votes on this campaign? Much of the democratic process could have been done in those 10 years through public debate, engagement and lobbying, instead of its being reduced to the actions that happened in the Chamber? Frankly, that is reducing democracy to a game of mathematics.
Sir Alan Campbell
This is cold comfort to people who want to see the Bill pass, and pass soon, but I would say to the right hon. Gentleman that this has all been part of that process. I do not want to play with hypothetical situations, but let us imagine that this legislation was taken forward. I have no evidence to suggest this will happen, other than the fact that it could, but if one of the MPs near the top of this year’s private Members’ Bills ballot decided to pick up the assisted dying Bill and run with it, there would be lessons to be learned. There would be lessons about how we use time, and about how wide the scope of the Bill should be because of the amendments that would be tabled. There would be a lesson about how the Lords should deal with the situation, even though it would be deeply uncomfortable for them.
I gently say to the proponents and opponents of the Bill that, if someone picks it up and runs with it, and prays in aid the Parliament Act—as I have said, our view is that it falls within the scope of that Act—there would be rules around that, too. Lessons need to be learned on top of what the right hon. Member for Tonbridge is getting at, which is about how we take public opinion with us and build consensus, which, as we have heard, takes time.
Andrew George
The Leader of the House said earlier that he felt that a private Member’s Bill was not necessarily the most suitable vehicle for legislation of this nature and gravity; as someone who has come out fairly high in this year’s ballot, I am interested in his remarks in that regard.
Leaving that aside, does the right hon. Gentleman not feel that, even if a private Member’s Bill is not the most suitable vehicle, it is now incumbent on the Government to find the time and the means through which the legislation can now be delivered, given that the Bill has the overwhelming support of the House of Commons?
Sir Alan Campbell
No, I do not, although who is to say whether in future the Government—or a Government—will decide to make the issue part of their manifesto, bring it forward and deal with it differently in that way? It is rather unfair for the hon. Member for St Ives (Andrew George) to expect this Government to pick up this Bill—or his Bill, if he picked it up and it failed. The hon. Gentleman has been through this before: he had a private Member’s Bill, which had quite a lot of public support. It got through its Second Reading and to Committee, and he got through clause 1. The reason why it did not get any further was that the Government of whom he was part—the coalition Government—stopped it. I have to say, in this well-tempered debate, that it is a bit rich for him to talk about Governments picking up Bills and running with them when he knows full well that it is much more complicated than that.
Dr Chowns
Would the Leader of the House agree that there may be a way to respect both the principle of the primacy of the Commons and the importance of parliamentary scrutiny, including full scrutiny in the Lords, by coming to the point of a vote? That would not be the Government taking forward the Bill, but him, in his role as Leader of the House—the role of representing the Commons to the Government—reintroducing this Bill in the Commons so that it could be sent directly to the Lords to complete the process of parliamentary scrutiny: to the point of a vote in the Lords. That would fulfil the fundamental democratic principles that have been argued for on both sides of the debate today.
Sir Alan Campbell
The hon. Lady makes an interesting point, but it is not for me, or for the Government, to tell the Lords how to conduct their affairs. It is not the Government’s job to pick up this Bill, after it has been through this first, stalled, failed, stage—
Sir Alan Campbell
Hang on. As we have already said, we have just been through the private Members’ Bill ballot again. We will have to wait and see. With respect, the hon. Lady does not know whether somebody is going to pick up the Bill and run with it in future.
Sir Alan Campbell
Hang on. I would want to see what happened here. We talk about private Members’ Bills changing the law on matters of profound conscience and social policy, such as, for example, abortion or capital punishment; I was not around at the time, but I doubt that those got through at the first go. I do understand that many people rightly regard this issue as a matter of life and death, but there were many people at the time who regarded abortion or capital punishment as matters of life and death. We have to be slightly patient and see what progress any future private Member’s Bill, if that is the route taken, might make.
Dr Chowns
I thank the Leader of the House for allowing me to clarify my point. My point is not about the specific content of the Bill; it is about the constitutional crisis caused its blockage. Is it really okay that the only way out of that is to wait for another private Member’s Bill? Is there a role in ensuring that it comes through the Commons?
Sir Alan Campbell
Thank you, Mr Wishart.
I am sorry if it was not explicit, but implicit in what I said was that I think the Lords need to reflect on what they have done. [Interruption.] Hang on. The stakes are quite high and we need to be careful that the conventions and rules in place are being used properly, so that the trust that we want to see is engendered in our political system. I want to address something else: the constant theme that, despite however many hundreds of Lords there are, there was a cabal—a handful of people—in the House of Lords who somehow managed to hijack this process and stop it all.
Sir Alan Campbell
The hon. Gentleman says that that is exactly what happened. There have been five private Members’ Bills and one amendment on this matter in the House of Lords. They did not go anywhere. That was not because the person proposing them at the time did not believe that they had merit. That person did not push them because they did not think there was support in the House of Lords.
We can pick whichever side we want on this issue. We have talked all afternoon about how the issue was never tested. My hon. Friend the Member for Hackney South and Shoreditch (Dame Meg Hillier) explained why it was never tested. Members can say, “Oh, it was never tested. We do not know.” If I wanted to, I could argue that it was never tested and we do not know either. We do not know whether there was a majority in the House of Lords for the Bill. Let us just be careful before we go out chasing those arguments.
I will conclude because I want to leave my hon. Friend the Member for Sunderland Central some time. Business managers made it clear that had the Bill returned from the Lords before the end of the Session, the Government would have sought to provide time to consider changes. As I have already said, the Lords play an important role in scrutinising legislation, but it is clear that people do not view the Commons and the Lords as being in isolation from each other. The actions of each House directly impact on the perceptions of this place more broadly. It is about what my hon. Friend the Member for Sunderland Central described as a question of trust. I am sure that Members of both Houses will wish to reflect on that and ensure that the actions of one House do not detrimentally affect the other.
I am sure that this debate will continue. I welcome that because at its heart is a Bill of profound importance to many of us, whatever side we sit on. It is also a debate of profound importance when it comes to the relationship between the elected House and the upper House. I am sure the debate will continue.
Pete Wishart (in the Chair)
Mr Atkinson, as you can see you have two and a half minutes.
Lewis Atkinson
All that remains is for me to thank Members for their many contributions today and the spirit in which they were made—the same spirit in which we participated in the Second and Third Reading debates. Those, including the contributions from opponents of the Bill, such as my hon. Friend the Member for Bexleyheath and Crayford, improved the Bill.
I agreed with my hon. Friend the Member for Hackney South and Shoreditch when she said that we are not here as a debating Chamber, but as legislators. To be clear, the petitioners do not believe that the Lords or anyone should unquestionably take up what has been done, but they do question how social change is possible in a democratic society, which is what we profess to be in our constitutional settlement. As the Leader of the House ably set out, that constitutional settlement has been evolving over time, including through the Parliament Act.
The Hansard Society is absolutely clear that the Lords were within their rights to do as they did under the current constitutional settlement. It is also clear that the Bill therefore passes back to the Commons, should it be reintroduced, and that the Parliament Act would be an entirely appropriate means to do that. Let me be clear, because there has been some suggestion that that would force the Bill through without amendment. Should the Bill be reintroduced, there would again be opportunity for the Lords to consider and pass amendments to it. But there would not be an opportunity for the Lords to not reach a conclusion.
I am far from being a constitutional radical. The right hon. Member for Tonbridge did a good job of painting me as some radical saying that I wanted to abolish the Lords. Maybe his AI suggested that I wanted to do those things because he certainly did not listen to my speech. Perhaps we can have a cuppa to discuss it.
The petitioners want to see that change is possible within our constitutional settlement. These are issues of life and death; they are not abstract concepts for the petitioners. I again thank Nathaniel and Sophie for their work in introducing the petition and thank everyone who signed it.
Question put and agreed to.
Resolved,
That this House has considered e-petition 752673 relating to the timely progress of bills through Parliament.
Written Correction
Other Correction
Layla Moran
Health Bill
The following extract is from the Second Reading of the Health Bill on 1 June 2026.
Layla Moran
Recently in my surgery, I spoke to a woman called Freya-Rose, who described how repeatedly recounting traumatic experiences compounded her own suffering… Above all, the Bill will be judged not by us, but by Chris and Freya-Rose, the very patients who deserve to be put at the heart of this legislation moving forward.
[Official Report, 1 June 2026; Vol. 786, c. 916.]
Written correction submitted by the hon. Member for Oxford West and Abingdon (Layla Moran):
Layla Moran
Recently in my surgery, I spoke to a woman called Kiera, who described how repeatedly recounting traumatic experiences compounded her own suffering and that of her child, Freya-Rose… Above all, the Bill will be judged not by us, but by Kiera and Freya-Rose, the very patients who deserve to be put at the heart of this legislation moving forward.
Written Statements
Fusion Energy Generation
(1 day, 5 hours ago)
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The Minister for Energy (Michael Shanks)
My hon. Friend Lord Vallance of Balham, Minister of State for Science, Research and Innovation has today made the following statement:
The Department for Energy Security and Net Zero is today publishing a draft national policy statement—NPS—for fusion energy generation (EN-8).
Fusion energy has the potential to play a key role in the UK future energy system, supporting long-term energy security, delivering an abundant source of zero-carbon energy and with the potential to export the technology globally. In the shorter term, it is helping to drive growth across the country, delivering high-skilled jobs, inward investment and supply chain development. As fusion technologies continue to advance and private investment accelerates globally, a clear and proportionate planning framework is essential to ensure the UK remains competitive and able to capitalise on the long-term economic opportunities that fusion energy presents.
Today a draft national policy statement for fusion energy infrastructure, EN-8, was laid before Parliament. This delivers on the Government’s commitments within both the UK’s modern industrial strategy and the UK fusion strategy to develop a fusion-specific NPS and publish a draft by summer 2026. Publishing this draft marks an important milestone in creating the conditions for fusion to move from research to commercial deployment in the UK. It will help to ensure that the planning system in England and Wales is ready to support future fusion energy projects. This will support the growth of the UK fusion industry, enable innovation and skills, and reinforce the UK’s position as a leading destination for fusion investment.
The draft EN-8 does not identify specific sites for fusion energy infrastructure and is technology-agnostic (it will apply to the different types of fusion energy technology, e.g. magnetic and inertial confinement), ensuring flexibility for developers and responsiveness to innovation in fusion design. This is consistent with the Government’s July 2025 response to a consultation on a new NPS for fusion energy. That Government response also set out 19 fusion-specific considerations, grouped into environmental, safety & security, operational and developmental themes. Draft EN-8 provides the detailed requirements for developers and the Planning Inspectorate in these areas, in addition to those that already exist in the overarching national policy statement for energy (EN-1). EN-8 has a scope different from EN-7, which is the national policy statement for nuclear (fission) energy generation.
Today marks the start of the formal parliamentary process to designate EN-8 and bring it into force under the Planning Act 2008. From today until 30 November, Parliament will have the opportunity to scrutinise the draft, raise questions and make recommendations. A public consultation on EN-8 will run alongside this stage of the parliamentary process, and officials will provide a summary of consultation responses to the relevant parliamentary Committees once all responses have been received.
Following consultation, EN-8 will be laid in Parliament in its final form for approval by resolution by the House of Commons, or by deemed consent by the House of Commons following a 21-sitting-day consideration period.
[HCWS92]
Participation in Democracy
(1 day, 5 hours ago)
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The Parliamentary Under-Secretary of State for Housing, Communities and Local Government (Samantha Dixon)
Healthy participation is fundamental to a strong and resilient democracy. Yet engagement in democratic life cannot be taken for granted, and too many people and communities continue to face barriers that leave them feeling disconnected from it.
The Government are committed to encouraging broader and more inclusive participation in our democracy. To support that ambition, I am today announcing the launch of the democratic engagement fund, a new Government grant to support civil society organisations to design, test and deliver place-based interventions aimed at helping to widen participation in democratic life.
The fund will focus in particular on groups and communities that have historically experienced lower levels of turnout and participation. Evidence indicates that barriers to engagement, including capability, opportunity and motivation, can disproportionately affect groups such as young people, frequent movers, ethnic minorities, people from lower socioeconomic backgrounds, disabled people and those experiencing homelessness. There remains, however, limited evidence on which interventions are most effective in reducing or overcoming these barriers. By testing and evaluating a range of approaches in different local contexts, the fund will help to build a stronger evidence base on what works to enhance democratic engagement.
The fund also aims to provide early insight on engaging young people in our democracy, which can then be built upon ahead of the expansion of the franchise to 16- and 17-year-olds. This will support the successful delivery of the Government’s commitment to encouraging the participation of young people in our democracy.
Backed by a total of 2.5 million, the democratic engagement fund will provide grants of £1,000 to £50,000, with most awards expected to be around £25,000. The fund will support practical, locally led approaches that can build trust, remove barriers to participation and deepen people s connection to democratic life. At a time when confidence in democratic participation must be actively renewed, this investment will support action in communities across England while strengthening understanding of how different interventions can address barriers to engagement. Applications to the fund will open on 22 June 2026 and close on 31 August 2026, with projects taking place in 2027.
Further details of the fund, including its objectives and eligibility criteria, are set out in the prospectus published today on www.gov.uk. Through the democratic engagement fund, the Government are taking practical action to support innovation, deepen understanding of what works, and help to ensure that more people, in more communities, can participate meaningfully in our democratic life.
[HCWS93]
Grand Committee
Arrangement of Business
The Deputy Chairman of Committees (Lord Young of Cookham) (Con)
My Lords, if there is a Division in the Chamber while we are sitting, the Committee will adjourn as soon as the Division Bells are rung and resume after 10 minutes. Sadly, the broadcasting is not working at the moment, so I will ask the Committee to adjourn for a few minutes while we sort that out.
Reforming the Child Maintenance Service (Public Services Committee Report)
(1 day, 5 hours ago)
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Baroness Morris of Yardley
That the Grand Committee takes note of the Report from the Public Services Committee Reforming the Child Maintenance Service (3rd Report, HL Paper 181, Session 2024–26).
Baroness Morris of Yardley (Lab)
My Lords, I am very pleased to speak to the report from the Public Services Committee, Reforming the Child Maintenance Service. In doing so, I thank everybody whose work has helped us to produce it. First and foremost, I thank those who gave us evidence, either in person in the round tables we had or through written contributions, talking about their own circumstances. It was very difficult, but they did so in an honest and open way, hoping that we would be able to bring about change that would make life for them and the people who use the service more effective than it is now. I also thank our team: Dan Hepworth, our committee clerk, Tom Burke, Claire Coast-Smith and Clayton Gurney. I thank all members of the committee as well. Some of them, like me, have since left the committee, so I offer a very special thanks for their work not only on this report but over the three years for which they served.
This is an important and unusual topic. It is one of a relatively narrow range of areas where we all agree that the state should intervene in family life for the sake of children. That is how important it is. Four million children in our country now live in separated families. Most parents resolve the financial issues around that separation between themselves—parents who can come together in their interests and those of the families and children, to make sure that children do not suffer any more than need be.
However, many, for lots of very understandable reasons, are not able to do that. It is that group who turn to the state and the use of the Child Maintenance Service. The number of cases considered by the CMS over the last decade has grown—and, one suspects, might grow further. The number of cases has gone up sevenfold and the amount of money paid by one parent to the other eightfold over a decade. For the 760,000 children whose parents use the CMS to resolve the financial consequences of a relationship breakdown, it is a vital service. We know the consequences of children growing up in poverty, with the conflict of parents unable to live together and disagreeing about the economic future of the family.
The noble Baroness, Lady Sherlock, summed it up very well in her appearance before our committee. She gave a rather long and convoluted Minister-style description of what the CMS does and then said simply at the end,
“our job is to get money to kids”.
For all the grand words, that is, in essence, what this is about: making sure that, in these circumstances, money gets to kids so that their lives are better.
It does work sometimes. The CMS can claim that it has kept 40,000 children out of absolute poverty, because it was able to resolve the problems as far as those families were concerned. Inevitably, the people who contacted us were those for whom the system had not worked—we know and understand that—but, looking at the evidence and the numbers, it is difficult not to conclude that the system does not work for too many families, parents and children. It is not an easy role for government; it is a last resort. It is for people whose relationship has failed to the extent that they are not able to resolve the difficulties. For the bureaucracy of the state to come into a relationship that is not thriving is difficult, but that is the task of the CMS, and it needs to do it well.
The CMS has only two aims in making sure that money gets to kids: to support children to stay out of poverty and to make sure that parents pay what they should. It is simple; if you get those two things right and make it work, you have solved the problem. It does not work at the moment for too many families, but for each of those families it fails 100%. Some public services can say, “We’re a success. We deliver 90% of our target”, or “We’re a success. We deliver 85% of our target”. But with the CMS, for every family for which it fails to deliver success, that is a 100% failure, and the consequences of that on children and the family are pretty dire.
Our recommendations are all designed to try to help the Government improve this service. I think the DWP wants it to do better; we felt no resistance. No official came to us and said, “Everything is brilliant. We don’t know what you’re talking about”. There is a general agreement that, for too many families, this does not work. As I said, our recommendations are built around our contribution to trying to make that better.
The central pillar of this must be how we decide what a child needs and how much a parent should pay. Unless you get those two things right, nothing else follows. What money does the child need so that they can thrive? What money should the parent pay given their financial circumstances? That is wound up in what the DWP calls the “calculation”. If that is robust, sound and agreed to by everyone, we stand a chance of the CMS being a successful organisation, but if it is not, it is built on false foundations—it is built on sand and will crumble. We did not meet anybody—not the Minister, the officials or the people who are meant to be using the system—who felt that that pillar of how the calculation is made is fit for purpose. It is not fit for purpose.
We are working on legislation that was passed in 2000, so it cannot be fit for purpose, because economic, work and family patterns have changed so much since that date. We are relying on a calculation—an algorithm—that works as life was in 2000. It simply takes as its basis HMRC data from the last year for which tax is available for any individual. We all do tax returns, so we know that it is dealing with data from a tax return that could be two years old. During that time, our economic lives, jobs and employment patterns might have changed—we may have changed jobs, have fewer or more hours, or our work may be insecure. All those things change, but the formula does not change with it; it still goes on what your tax return said, definitely one year ago and potentially even two.
It also takes as its second source of data the information that was electronically available in 2008. The year 2000 was 25 years ago—a quarter of a century—and 2008 is not much less time ago. Yet the only data it will deal with is what could be gathered electronically in 2008. If a paying parent gets income from a rental house or anything like that, none of it is taken into consideration because, in 2008, HMRC could not collect that data in an electronic form.
I am reminded of—I made this comparison in my own head—what is asked of families who claim the carer’s allowance. When you claim the carer’s allowance, if your income is not the same for five or six weeks, you are expected to tell the DWP straightaway so that it can immediately adjust the formula so that it does not end up paying more. However, the Child Maintenance Service does not do that. It does not ask for that information. If you give it that information, it cannot cope with it and, if it attempts to cope with it, it takes so long to deliver that the formula just does not work for the families.
The only proviso to try to bring this up to date is the 25% variance, where, if your income varies by 25%, the service is prepared to look at the formula within the year. However, you could lose 20% of your income and still be expected to pay the same amount of maintenance money as before. Equally, your income could go up by 24% but your child will not benefit from that increase until you do your next tax return. So that main pillar on which everything else is built does not work; it needs to be brought up to date.
When we listened to the evidence from the DWP and the Minister, we were very pleased to hear that they took this on board and were carrying out work to make sure that we had an up-to-date, relevant model on which we could build the rest of the system. I must admit, though, that they said it would be done by the end of the calendar year, but it has not been announced as yet. My first question is to seek an assurance from the Minister that, very late though it is, this work is in hand and will be announced soon.
I was grateful for the document that was sent to me last Thursday by the DWP, which concerned a consultation—that word worried me to begin with—on reform of the calculation. I was even more concerned when I read the opening sentence, which talked about the work that was taking place because the DWP was considering revising the formula. I seek an assurance that that phrase—“considering revising the formula”—should not be taken how it reads and that, in actual fact, we are not just considering it but are actually going to do it.
My second point on that is about family patterns. The formula is based on the income of the paying parent and does not take into account the income of the receiving parent. We no longer live a family life where one parent works and one parent cares, but the formula does not really take that into account. In some cases, it has an inbuilt incentive for parents with caring responsibilities not to let their child stay overnight with the paying parent for too many nights out of fear that the calculation will change again and the caring parent will not have enough money to bring up their child. That is the first pillar of the formula at which the committee looked and on which it made recommendations.
Secondly, even if the formula is out of date, it does need to be enforced. The second pillar is built on enforcing the calculation when the person does not pay. Again, the basis of enforcement has to be, “What is the definition of non-compliance? When does the system yank itself up to get going?”. Lots of things can go wrong, but when does the system actually say, “Hang on, this needs enforcing because somebody isn’t paying what they’re meant to pay”? It is as simple as that: what is the trigger for letting that happen? The trigger is that somebody has paid nothing in any given quarter in a calendar year. Think about that: they have paid nothing.
What happens as far as that is concerned is that you can pay something in the quarter, but not a lot, and the enforcement mechanism does not kick in. Some 46% of compliant parents pay over 90%. Some 23% pay less. But, in that first figure, only 46% of compliant parents paid something within a quarter. Less than half of compliant parents pay over 90%: not 100%, but over 90%. That means that you can pay very little and you do not fall into the category where enforcement measures will be put in place. If you do fall into the category where enforcement measures take place, it takes so long to use the system that receiving parents rarely feel that justice has been done. Some 2% of cases go to court, and that is not because 98% of enforcement cases get dealt with successfully and do not need to go to court. It is because the length of time that takes and the bureaucracy surrounding it militate against it happening.
There is another question I want to make sure the Minister answers in her response. We were given an undertaking that administrative liability orders, which have been on the books for a long time, would be in place by the end of the last calendar year but, to the best of my knowledge, we are still waiting for that to happen. We should be clear about what that means. The department can go to court to collect a given amount of arrears but if, by the time the case has got to court, the arrears are higher, the department does not get permission to claim the higher amount; it gets permission to claim only what it went to court for in the first place. That just does not make sense.
Our third pillar on this was communication. Communication with this group of people is vital. The portal that the DWP has set up works well. A lot of people said that they found it helpful because they could access it 24 hours a day and it worked for them. That was not true for everyone, but it worked for a lot of people. But lots of people still use the phone or want face-to-face contact, and it was that group for whom the communications system just did not work.
We should think of the pillars needed to offer the firm foundations for a child maintenance system that does the job. That would be an effective way of calculating what money needs to transfer from the parent who pays to the parent who cares. The second pillar would be a quick and robust way of enforcing things when that does not happen, and the third would be good and proper shared communication between the department and those people who use the service. On all those things, the system does not work as effectively as it needs to.
The people who use this service are very vulnerable. If they are not vulnerable people, they are people at a vulnerable time of their life. Many of the comments we heard were stronger from people who suffered domestic abuse or were in other kinds of relationships that were tough to begin with, without the system not working for them. Of course, the people who did not give us evidence and did not write to us, and whom we did not listen to, were the children. They do not have a voice because it is not their job to have a voice. But it really behoves us to remember that they are at the core of this. They are the reason we need a better child maintenance service than we have at the moment. I beg to move.
Baroness Coffey (Con)
My Lords, it was a pleasure to be on the committee formulating this report. We were led ably by our chair, the noble Baroness, Lady Morris of Yardley, and it was a pleasure to work with the other members of the committee. I should pay tribute to my noble friend Lady Stedman-Scott. She was on the committee but had to come off it because of her Front-Bench role. She had initially encouraged the committee to look into this, and I am glad that we did.
I will not pretend otherwise; I used to be Secretary of State for Work and Pensions. I was there for three years. Aspects of the Child Maintenance Service were a key part, for me, of how we reduce poverty. I think in that I am united, not only with the committee but the Government, in seeing this as a way to try to reduce child poverty.
However, I am concerned that, in the response to very well-thought through recommendations and challenges to the Government, there were a series of missed opportunities. There are missed opportunities by the Government to do exactly what they say they want to do. It is “Mañana, mañana”, when we have not got some of the legislation we need. For example, I understand that, with an administrative liability order, there is probably still a problem with Scotland. But why do the Government not just get on and deal with the appropriate legislation for England and Wales while they tackle the issue in Scotland? There is no difficulty or constraint on trying to do one set of regulations tackling England and Wales and one for Scotland.
The issue about domestic abuse continues, with the commencement of another piece of legislation. I say to noble Lords that I have learned from that in a different way. For every Private Member’s Bill that I have been involved in or advised others on, I have always advised them to put an automatic commencement date in, because these Acts of Parliament were not put into effect. Again, I am concerned by the Government’s response. I recognise the work they are trying to do in tackling violence against women and girls, and the strategy there. But it feels as though they are saying, “This is too difficult” or “No, we can’t really do this”, despite it coming from a government Bill handed to a Back-Bencher in the previous Parliament.
Elsewhere in the responses we have seen that DWP civil servants are actively trained on domestic abuse and therefore can address it in a particular way, or, as I will come to shortly, removing every claim to collect and pay will solve this problem. We have not seen any legislation for that yet. I do not know whether the Government intend to bring that forward in this parliamentary Session. It certainly was not in the King’s Speech, but we know that it can happen regardless. It is worth tackling now, as indeed are some of the other measures, where the opportunity is there to act rather than wait, with—dare I say—the perfect being the enemy of the good, particularly when it comes to the children to whom my noble friends referred.
Going back to some of the issues that we have, one thing surprised me. When I was Secretary of State, I asked for a focus on people who are not working and to make them a priority for targeting by work coaches—to help these young people get into work. The reason that matters is that if you are on benefits, in essence, you will either pay nothing or you will pay £7 per week, deducted from your benefits. That is all. With collect and pay, 38% of the people on it end up with a deduction from benefits. You would like to think we would even get £7 per week through that, yet we know that the number of children catered for through direct pay is about 60%. About 40% are through collect and pay. Yet 220,000 children get zilch—not a single penny—through the collect and pay approach. That is based on the figures for the end of 2024, because that is what was available when we were formulating the report. I have not been able to do the same analysis to that extent. I appreciate that when I tabled a Question to the Government, it was considered too much to do that bit of analysis. I accept that some of these things will come out in statistics in due course.
Still, let us think about that: 220,000 children did not get a single penny. I am just reinforcing what my noble friend Lady Morris of Yardley was saying—I call her “my noble friend”, because we were friends on the committee, being cross-party in that regard—that that is what we are dealing with. I suggest to the Minister that she should reflect on that and go back and look at prioritising employment support. We know that unemployment is going up. If this is a way of helping young children to get on in life, it is imperative that we help those who are not working at the moment to get into work, if for nothing else than for their children.
There was another missed opportunity with the research that the Government were due to publish last Monday. They were going to release the information that they had and then it came out on Friday. I have only had a chance to skim-read the 117-page document, but I was surprised by the questions that were asked. There is nothing surprising about the tensions between two parents. It was no surprise to me or, I expect, to members of the committee or indeed other noble Lords that the wealthiest people are the ones who seem to resent handing over quite a lot of their money. Meanwhile, those on the lowest incomes would have been quite happy to see more but did not necessarily expect people to be able to pay more because they knew the circumstances of the father—it is usually the father, I think 86% of the time—or mother of their child.
I was surprised that we did not get into other bits of research about changing the formula or the calculation. Indeed, I was disappointed by the rejection of the court approach of trying to work out a formula. The key thing about our recommendation about the court approach was that everything is put on the table. The big arguments that happen between parents are about the other person lying: “They’re hiding stuff”, “They’re hiding money”, “I know he’s got these things”, or even, “I know he’s increased his pension contributions deliberately to reduce his income so he doesn’t have to hand over money”. It is normally about the argument between the parents, while the child is the one who suffers.
I thought that the beauty of the court approach was that basically people have to put their assets on the table. You would like to think that there could be much more use of, as my noble friend referred to, a lot more of the HMRC data that we have today. Indeed, I hope that we will start to be able to use some of the powers that are there to try to understand where people are simply doing whatever they can because their—let us put it this way—loathing of the other parent is causing detriment. In that regard, my understanding is that the Government are not going to change the formula at all, although they may well move the variation where, if your income changes by more than 25%, the calculation is redone and will reduce that to 15%. Okay, that is fine, but it is another missed opportunity for comprehensive research and to look afresh at some of the key issues that cause division.
That brings me to the whole policy that the Government are continuing to press on with. We have not seen the legislation but it is about switching off direct pay. This is where the Government basically help with the calculation of what should be exchanged between two parents, as opposed to collect and pay, where money comes into DWP and then gets handed out with a difference in charge. I am sure that the Minister has looked at the recent survey of separated parents, which shows that a pretty high proportion of parents had arrangements—probably higher than shown in the statistics or in other assessments that the Government have done, particularly in the analysis of what the benefit would be from reducing the number of children in poverty as a consequence of these changes, which, frankly, is very low, given the big hurrah that has accompanied this.
It is worth looking at that in more detail, recognising that there are higher figures for what gets paid over than the Government may think from some of their other surveys. We should also recognise, in other research that the Government have published very recently, how the majority of parents believe that having this formula, or the approach of being able to use the Child Maintenance Service, is important to get some kind of enforcement without the need for all the other things that we are referring to, whether that is removing passports or going to prison, both of which happen exceptionally rarely.
One of the reasons given by the Government for moving away from direct pay is that it was a failure of direct pay that the numbers on direct pay have gone up, and the whole point of direct pay was that at some point people would come off the need for it. That does not seem very logical to me. In the results at the end of December 2019, there were about half a million families in this arrangement overall, both CP and DP, and there are about 780,000 in the latest statistics. It shows there is a clear appetite for wanting to use this process in order to try to make sure there is a clear way to get money to a child. I found it odd that, while the Government accept the recommendation that we should advertise this more, the very fact that parents use it was seen as a policy failure, because they were on direct pay and had not decided on a different sort of arrangement that did not involve the Child Maintenance Service.
I feel strongly about this, and I know the Minister knows that, because it comes down to money—it comes down to how much money is going to the child. We continue to see in the amount of debt that is left over that a considerably higher percentage of what was due to be collected is happening through the collect and pay service. We are seeing the compliance rates much higher on direct pay, even on the survey that was done a few years ago, where 60% was full compliance—full compliance, not over 90% of the 46%, but full compliance—through direct pay. I remember my argument with the officials at the time, and my noble friends were in the room. I am pointing to my noble friend Lady Shawcross-Wolfson, who was a non-executive director of DWP at the time, and my noble friend Lady Stedman-Scott. My argument was, where we had something like 300,000 children who are getting all the money that they are supposed to have, why would you kill off that process just to get them into a system where somebody has to hand over money to the Government to then pass it back?
I come to my final point, because I appreciate that the Minister and I will not necessarily agree on that, but I hope that she looks at this again genuinely for the sake of the children. In terms of some of the other recommendations, I think that it would be useful to see more on the family hubs. It was good to see from the MoJ that the use of the £500 mediation voucher has significantly increased. That is encouraging because, ultimately, we want to try to reduce conflict. In terms of thinking through some of the digital communication, I was slightly surprised that there did not seem to be a simple way to have a more proactive IT system. I am conscious that changing IT is always challenging. I was thinking in particular of paragraph 32 in the list of recommendations and conclusions.
Ahead of any legislation, I hope that the Government will accept the recommendation to publish an evaluation of the impact of moving all cases on to collect and pay. I am afraid that I just do not accept the comment that it will not cost any more money. It is physically impossible to see how that could be the case, or illogical, from my perspective. As I say, there will be missed opportunities for many children in this country. I know that that is not the outcome that the Government are seeking, but I hope that the Minister looks again at some of the recommendations from our committee and really makes a difference to the opportunities for children who, quite frankly, are some of the most deprived in our country.
Lord Shipley (LD)
My Lords, I too thank the noble Baroness, Lady Morris of Yardley, for her leadership in what was an important and complex inquiry. I also thank her for what she said just now, which I found a forensic analysis of the operation of the Child Maintenance Service. I thank all the staff for their support to the committee. I thank the noble Baroness, Lady Stedman-Scott, too, for her suggestion—for it was her suggestion—that we should undertake this inquiry when she was a member of the Public Services Committee.
I also thank the noble Baroness, Lady Coffey, for bringing her experience as a Minister to the Select Committee’s work, and for her important suggestions to improve outcomes for children. As she just said, it is about how much money is getting to the child. Getting money to kids who need it is a means to alleviate some child poverty.
I thank the staff of the Child Maintenance Service for the information that they provided and the explanation, from their perspective, of issues that we raised. I particularly thank them for their welcome when we visited the service in Hastings.
My conclusion, in view of the Minister’s response letter that we were sent in March, is that this committee’s work is not complete. I hope that, when we hear from her later, she will reassure us that progress will be made on our recommendations.
I agree with all the conclusions from the noble Baroness, Lady Morris. As she said, it is very difficult to avoid the conclusion that the system does not work well for many people. For some families, the system is a 100% failure, as she said. I was surprised to find how slow and inadequate enforcement is; it is simply not strong enough. As the noble Baroness, Lady Coffey, just reminded us, too many children—220,000—are not getting a single penny. The Government run this service with 3,500 staff; as 220,000 children do not get a single penny, it seems a failure. As the noble Baroness, Lady Morris, also reminded us, there is a big issue with communications—particularly, from my perspective, communications with those trying to use the system.
The inquiry sat for several months and reported in October last year. About half way through, I recall beginning to think about who was actually in charge of the Child Maintenance Service—the Minister, the department more broadly or the Child Maintenance Service itself. Indeed, I have now begun to wonder whether decisions are now being made elsewhere in Whitehall and not by the Minister and her department at all. I think this matters, but I cannot interpret what I have just said because the Minister’s letter of 6 March accepts that changes are needed but gives no indication of what the Government are going to do or when they are going to do it.
Primary legislation will be needed to remove direct pay and transfer those cases to collect and pay. That is the Government’s intention, but I cannot see—as the noble Baroness, Lady Coffey, just pointed out—how such a transfer can be achieved at no cost, but that is what we have been told. I think the case has been made that direct pay should be retained for those who prefer it. Apparently, administrative liability orders will be legislated for as soon as possible. Of course they should, but that was true months ago. What is the plan for when the orders will be legislated for? The Minister may make a set of announcements when she speaks later.
As we took evidence, I grew more concerned by the performance of telephony services. We said in paragraph 24 of our conclusions and recommendations:
“It is unacceptable that parents still face an average 18-minute waiting time to speak to the CMS on the phone, with tens of thousands of callers waiting over an hour and over 500,000 calls being abandoned in the last year alone”.
I am reaching the conclusion that the CMS wants to run a digital service and reduce telephony, even though telephony enables a problem to be ironed out immediately through synchronous discussion. I hope the Minister will reassure us that the telephony systems will be improved, because they can be more efficient.
I also concluded that the service is very slow to change in both reaching decisions and then implementing them. The consultation on the child maintenance calculation, about which we heard further earlier this afternoon, needs to be very clear as to what its objective is. We also need a much stronger definition of non-compliance in collect and pay, as the noble Baroness, Lady Morris of Yardley, said.
I found the Minister’s response on key performance indicators, in her letter at the beginning of March, disappointing. The response to question 7, which asked why the DWP would not publish the number or proportion of calls facing excessive wait times despite holding the data, said that all developments to official statistics are progressed through the statistical work programme. When are performance indicators official statistics? If the information on key performance indicators is there, it should be made publicly available. They exist but they are, I regret to say, hidden from public gaze; I do not understand why that should be.
When Select Committees take evidence, one of the most valuable things they can do is listen to the recipients of a service. It is not enough to listen only to those providing the service. We held two engagement events, one with receiving parents and another with paying parents. Let me read out the key words in our report on bias:
“Almost all receiving parents believed the system was biased towards paying parents, allowing them to reduce their payments or evade altogether due to the lack, and timeliness, of enforcement and the loopholes in calculations”.
However, when I listened to paying parents, they said the opposite. As the report states:
“Almost all parents believed that the Child Maintenance system, its processes and the underlying legislation was biased against the paying parent, and in favour of the receiving parent”.
There are two ways of looking at those two different facts. One is to say, “If both the receiving and paying parents are unhappy, that probably means the Government have got it just about right”. However, the opposite is what I believe to be true: both the receiving and paying parents are right, and what they are talking about is their own personal experience of the operation of the service.
I hope that the Minister has read the summary notes in our report on our engagement events with both paying and receiving parents—I am sure she has—because I found them very instructive. One thing that was asked for was a shared narrative. Receiving parents were fed up with having to re-explain the circumstances of their case each time they rang up because a different person was receiving their call. That person would then get some information on a screen, but it would not be available to the person who had made the call. One thing I hope the Government will look at is creating a shared narrative on a screen that both participants in a call can read. I understand the difficulties around this being private information held by the Child Maintenance Service but, equally, it is very important that the receiving parent who wishes to raise an issue can be confident that the information they are talking about is available to the person with whom they are speaking.
In conclusion, it is true that in many cases the Child Maintenance Service works well, in particular in straightforward cases. Reforming the calculation formula has become a very urgent matter, and so has speeding up enforcement. I have the highest regard for the CMS’s 3,500 highly committed staff. They are in the front line of reducing child poverty, and over 1 million children depend on the system working to keep them out of poverty. Yet 100,000 children miss out on maintenance payments every quarter, and around one-third of separated families have no child maintenance arrangement at all. So I conclude that this is work in progress. I just wish that action to effect change could be speedier.
Baroness Deech (CB)
My Lords, it is a heartrending statistic that 4 million of the UK’s 14 million children live in separated families. That is a higher proportion than in many European countries. The drawbacks of that situation are well known. Children from one-parent families show lower average educational attainment, reduced social mobility and a higher likelihood of becoming young parents themselves. Almost all these patterns are driven by poverty—44% are living in poverty and instability, with reduced social capital—rather than by single parenthood as such. I add in parentheses that I hope this Government do not plan on any legislation that will cause more cohabiting parents to split, for that is what is likely if financial claims by one cohabitant against the other are enabled after three years, as has been suggested, because the parents will separate before those three years are up.
It behoves us to do all we can to make sure that absent parents, usually fathers, pay their fair share of support for the children they have left behind. The figures in the Public Services Committee report show otherwise. Some 31% of liable parents in the collect and pay scheme paid nothing. Some £28.1 million was due in one quarter. Enforcement is slow. The process and the calculations breed distrust between parents, and many of the families involved have suffered domestic abuse.
It is a matter of regret that the Government have rejected some of the committee’s recommendations, especially those at the heart of the system relating to the retention of direct pay and the treatment of victims of domestic abuse. The CMS is a vast service, employing over 5,000 people, and it suffers from what we are used to with national government services: lengthy waits on the phone and poor communication. That is why it seems to me that we have a troubling dissonance between the principle of child maintenance and the reality.
In family law, the interests of children are paramount. This principle permeates our legislation, court determinations and public debate. But, when we look at the practicalities of our system for securing support for those children left behind by one parent, there is little reflection of that principle in reality. The report of the Public Services Committee on reforming the CMS exposes that breach. It describes a system where, despite the paramountcy of the child’s interest, the delivery of support is complex, enforcement is weak and too many children are not getting what they need and deserve.
Child maintenance is not discretionary. It is a moral and legal obligation. Parents are under a continuing legal duty to maintain their children. Under the CMS, maintenance is due to children usually only until they are 16, or 20 if they are still in certain types of education, oddly excluding university education. Again, I add in parentheses that the Financial Provision Bill I have introduced in this House on several occasions would make maintenance mandatory to age 21 as the default position. The duty of parents to support is regardless of whether they were married, and the CMS is the infrastructure for where court or family payments are not working.
There is a striking contrast between the flimsy support for child maintenance and the vast legal structure of payments to divorced spouses, something lawyers are heavily focused on. Payments to divorced wives occupy large amounts of court time and chalk up disproportionately expensive costs going to the lawyers who represent them. Spousal maintenance is based on need, compensation and the ending of a partnership. It involves significant calculation and disclosure of all assets and income. Amazingly, however, assets and property, unearned income and overseas income are not taken into account in calculating child maintenance. On paper, children’s claims are paramount, while spouses’ claims are contingent. But children’s maintenance is compulsory and spousal maintenance is conditional in law. The way the system works shows something very different in the order of priorities.
The Public Services Committee’s report shows that non-payment of child maintenance is widespread. Much has been said about that by speakers already. If custody is shared, there is a reduction in the amount paid to the person who, in common sense, is the caring parent. Claims for more custody may serve to reduce the amount that the largely absent father pays. Even when attempts are made to enforce the payment, compliance is only partial. Too many children are left in poverty, which this Government want to end. So often we have heard that this Government are lifting children out of poverty. Are they? I would go so far as to call the system a national disgrace, in part because taxpayers are left to fill the gap that absent fathers have left.
This has come about because child maintenance is often, unusually, not a matter for the courts. Even in divorce cases, the amount paid to children is often an afterthought, tacked on to the end of a judgment which is all about the needs of the ex-wife and the ex-husband’s ability to pay. For others not in the court system, as we know, the CMS operates. But the courts focus on individual cases, while the CMS has to deal with hundreds of thousands of cases, so the CMS relies on formulaic processes and standard arrangements. One can see that AI will take over this process one day, and it might well be a much better outcome.
In the direct pay system, the payer and payee are left to deal with each other once a calculation has been made, so there is little evidence as to whether it is really working. Enforcement is slow and reportedly not vigorous enough. This is such a contrast to the way divorced wives are treated. For them, there is individual scrutiny. The entirety of the couple’s finances is set out. If payment is not made, one can go back to court. There is professional representation on both sides. I am not saying that all children’s support orders can be handled like that, because there are, sadly, so many. But it is a bad contrast of the two systems. Divorce maintenance can be an expensive protracted struggle, and it too is having to face up to new emphasis on domestic abuse. But divorce gets the level of judicial scrutiny, comprehensive treatment and enforceability that children do not get. A single parent might be better advised to claim maintenance through Schedule 1 to the Children Act 1989, which applies to them in court.
The committee’s report would improve matters for children. It is a matter of regret that the Government have disagreed with some of its central proposals, and I hope we will hear why. The Government have agreed to stronger enforcement tools and faster appeals. They have agreed to improved staff training, especially relating to domestic abuse cases, and to improve communications. The Government have accepted that the calculation of maintenance should be reviewed, but there is no detail. This needs improved income assessment and stronger investigation of the ability to pay. In contrast to the committee’s report, the Government want to move to a single system of collect and pay, replacing direct pay. This may protect payees whose relationship is troubled, but it may at the same time increase hostility and disturb arrangements that were working.
Before 1991, child maintenance was largely a matter for the magistrates’ courts. After all these years of a state child maintenance service in different guises, one wonders whether it was right to remove it from the supervision of the courts. Has the pendulum swung too far to an administrative, impersonal system at the expense of trust, openness and enforceability? Perhaps more oversight by magistrates would help. In the meantime, we are letting down children, and the consequences of this will carry on down the generations. Studies have shown that the effects of poverty on a child continue through their life and pass on, in turn, to their own children.
I ask the Minister: will the Government get on and reform those limited parts of the system that they have agreed to reform? They have said that they want to end child poverty. Here is an opportunity for them which they must seize immediately; there can be no reason why they should not. I conclude by thanking the noble Baroness, Lady Morris, for the wonderful work that she and the rest of the committee have done on this neglected, complicated but vital system.
Lord Farmer (Con)
My Lords, I, too, thank the noble Baroness, Lady Morris of Yardley, her committee and its support team for this report, which covered much ground and recommended far-reaching reforms that stand a good chance of improving outcomes. They address long-running problems with the service and its precursors.
To declare my interests, my parliamentary adviser, Dr Samantha Callan, is the Government’s independent reviewer of the Child Maintenance Service’s response to domestic abuse, which is frequently mentioned in the committee’s report. She is also the director of the Family Hubs Network, which she and I co-founded in 2019 to show government the potential for family hubs to be a game-changer for families. Thanks to this Government, building on what the Conservatives achieved, they are now in every local authority in England. This is relevant because the Select Committee’s report envisaged a clear role for early intervention and support for separating parents that is easily available, community-based and delivered particularly in family hubs. Finally, I also took the Child Support Collection (Domestic Abuse) Act through the Lords.
This public service comes under attack every day, often for good reasons. However, after Dr Callan went under the bonnet of the CMS, she said in her January 2023 report that she found it to be a “reform-minded” organisation. It has the almost impossible task of helping separated parents, some of whom have never lived together, come to a durable arrangement for financially supporting children they were both responsible for bringing into the world.
We are a country that cares about child poverty. This service can be unreservedly concerned with its alleviation, because all maintenance payments are now disregarded for tax and benefit purposes. That said, we need to communicate more effectively to all parents, not just those who are separating, that it is parents who have the primary responsibility to provide for their children, not state agencies. Separated parents also have a responsibility to be single-mindedly child-focused in their dealings with each other, to avoid further harm to their children than that caused by the split itself or by being born to a home where one biological parent has always been non-resident. The Minister acknowledged this to the committee when she outlined the CMS’s role to facilitate payments between separated parents
“without causing any further harm”.
That harm must be mitigated, not least by the CMS working quickly and efficiently.
However, we need to acknowledge that the seeming intractability of problems facing this public service stems from our culture of hyperindividualism and family breakdown. Undoubtedly, some relationships must end, but we now take for granted the very high numbers of UK children not living with both their parents—around 44%, according to the IFS. It also highlights the fragility and complexity of so many UK families compared with other countries. Any reforms should learn lessons from abroad, but the character and prevalence of fractured families here set us apart, and what works elsewhere may falter here. I am not counselling despair or hand-wringing: quite the opposite. This policy area is another where the Government must grasp the nettle and be willing to make tough choices, and it is not true that the past 14 years were squandered in this regard.
The coalition implemented the Henshaw review commissioned by the previous Labour Government and legislated in a very tough environment to deliver the 2012 system. It has proven to be far from perfect but, fast-forwarding to 2023, the Conservatives also began to implement the Callan review, including by introducing two small but important Private Members’ Bills that would have improved enforcement and the service received by customers reporting domestic abuse.
However, the Select Committee’s report highlights that the secondary legislation required to bring these into force has not been forthcoming. I am particularly troubled by parents trying to obtain child maintenance when abuse from ex-partners is ongoing. Under Direct Pay, a paying parent cannot be stopped from putting money into their ex-partner’s bank account under the reference “for prostitution services”—if they put money in at all. Receiving parents can perpetrate emotional and psychological abuse by falsely telling the CMS that payments have not been made, so their ex becomes unjustly entangled in protracted and highly distressing enforcement proceedings. DWP research found that 71% of receiving parents and 51% of paying parents in Direct Pay report domestic abuse from the other parent. The CMS itself said that Direct Pay is
“not fit for purpose for victims of domestic abuse”,
given that it is
“difficult to pick out victims … comprehensively and reliably”.
So abuse is rife within the CMS customer base—not just male on female and not just paying parent on receiving parent. It is often insidious, subtle and very difficult to prove, so I have some sympathy with this Government’s plans to abolish Direct Pay altogether. However, I await the Minister’s later response to the Select Committee’s robust challenge concerning the likely efficacy of this reform and its supporting data.
I am also concerned that the legislation will simply never be brought forward because, while the organisation may be reform minded, nothing will happen unless the Government are of the same stamp. CMS reform is a can that has been kicked down the legislative road on many occasions, despite the severely outdated primary legislation that underpins many of its key operations.
The Select Committee report also mentions “lack of transparency” in calculations, about which we have heard a lot today. It helps explain why so many parents—paying and receiving—are deeply unhappy with the CMS service. A DWP survey of customers in contact with the CMS found that overall customer satisfaction was 39%, with only 47% of receiving parents and 31% of paying parents saying that they were satisfied. The committee cited important affordability and fairness issues being repeatedly raised in many reviews stretching back to 2014, and referred extensively to the planned calculation review. However, I understand that a letter to stakeholders from the Minister at the end of last week said that this planned public consultation on rates, thresholds and calculations will not now go ahead. The Minister cited a single study programme of quantitative and qualitative research with paying and receiving parents that was considered to undermine irredeemably the case for any further consultation, let alone reform.
I believe that this Government are in danger of putting too much weight and responsibility on study respondents, albeit those with so-called “lived experience”, to avoid making difficult reforms. These parents’ views are of course important, but they must be balanced against the considerable body of other evidence, including that provided by the Social Security Advisory Committee in 2019, which demonstrates considerable unfairness and anachronism in the system.
The Select Committee said:
“It is unacceptable that successive governments have failed to update the child maintenance calculation ... This has ultimately led to children receiving less money. Similarly, it is disappointing that no Government has sought to update the legislative framework set down in 1991 and amended in 2000”.
If this Government exonerate themselves from addressing these concerns, the CMS will be yet another area of public service the public has no confidence in. The Select Committee found the proportion of families using the CMS was lower than in 2012, and the proportion of families with no arrangement was higher. If they are abandoning their plans to review calculations, and the Direct Pay reforms are years away, what will the Government do to increase public confidence in the CMS? Also, while the proportion of families in family-based arrangements has risen from 29% in 2012 to 43% in 2024, how will they encourage more, and more durable, family-based arrangements so it is needed by even fewer parents?
Both receiving and paying parents say that support for separated parents to help them maintain family-based arrangements is “unhelpful” and “inadequate”. Many receiving parents are unaware of its existence. The committee concluded that far more support for separated parents was needed, and the Domestic Abuse Commissioner proposed better integration of the CMS with family hubs. Again, support for families early in what is typically a very difficult and confusing separation and child maintenance journey would likely reduce conflict; 30% of parents from one study said that could encourage good working arrangements.
Currently, the CMS does not operate within the family hubs network. The Government’s January 2026 response to the Select Committee report said that where support for separating parents seeking advice on the CMS was not available through a family hub, staff should signpost to other relevant services in the area. Could the Minister give us some examples of the support this is referring to? Apart from programmes such as Reducing Parental Conflict, I am not aware of any new services that have been funded or have sprung up in this area. The Callan review suggested, for example, that courses mandated by family courts for warring couples should be accessible to parents before they get that far.
The Select Committee also recommended siting mediation in family hubs as that can greatly help parents reach durable family-based arrangements. But access to mediation in and through family hubs will not happen just by saying it should. What cross-government work are the DWP, MoJ and DfE doing so that families get this and other help with child maintenance that has simply not existed in the past? How will family hubs enable the child maintenance system to work with other organisations? The April 2026 guidance for family hubs shows many signs of a better government-wide approach, so I am hopeful that the Minister will have good news to share, and I will gladly work with her, through the family hubs network, to make it a reality.
I will end where I began, with the reality that the CMS is grappling primarily with problems not with money but with relationships. The recent DWP research on child maintenance calculations says that
“relational, as well as financial factors are key in understanding non-compliance. For example, there may be a complex two-way relationship between conflict and non-compliance”.
Preventing high levels of non-compliance has never been successfully achieved by any iteration of the UK child maintenance agency. We need to take a different approach, with a much greater emphasis on helping parents avoid entrenched conflict and relationship breakdown in the first place.
Australia and the Nordic countries have family relationship centres all over the country with these specific aims. Australia is looking at our family hubs to learn how to integrate relational support with debt, housing and other services including, crucially, those delivered by the voluntary sector. Are this Government willing to learn from them how we can systematically and comprehensively support families in their relationships before, during and after separation?
Baroness Pidgeon (LD)
My Lords, I wish to speak about the Public Services Committee’s report, Reforming the Child Maintenance Service. This was the first Select Committee of which I have been a part since I joined the House. I have to say, in the end, I came away frustrated: frustrated for the children who are living in poverty because this support system is simply failing them; frustrated for both groups of parents, whose genuine concerns on both sides we heard; frustrated at the limited response from the department; and frustrated that, although we have shone a light on this area and made some constructive recommendations, it will clearly remain in the “too hard to fix” pile and little will change at the pace that is needed. However, I thank the noble Baroness, Lady Morris of Yardley, for her excellent chairmanship and leadership throughout this investigation. I also thank noble Lords for their excellent contributions today; we have heard detailed analysis of many of the issues that we explored and grappled with in this complex area.
Child maintenance is not an abstract administrative matter. It is about whether children receive the financial support to which they are entitled. The system must reflect modern-day living and the complexity of today’s family arrangements; it must be up to date. As the noble Baroness, Lady Deech, pointed out, child maintenance is not optional but a moral and legal responsibility.
The committee’s central message is clear: the current system is not working well enough for too many families. Too many parents do not engage with the service at all. Too many arrangements break down. Too many cases enter the system only after problems have already become entrenched and, at times, the experience of using the service is confusing, slow and a hindrance rather than a help.
The committee’s recommendations focus on making the system fairer and more workable by, for example, reviewing how a child’s costs are split between both parents; calling for real-time data-sharing with HMRC so that calculations are based on current income and assets, rather than on something from the distant past; considering the receiving parent’s income and assets; examining whether the current formula may discourage work; and reconsidering changes to direct pay. We made 41 straightforward recommendations that could make a real difference with accurate, timely and simple communications throughout. My noble friend Lord Shipley’s analysis of the telephone service’s poor performance highlights a simple, basic problem with the service that could easily be improved.
Too often, policy in this area is presented as though there was a simple choice between supporting the receiving parent and protecting the paying parent. However, having taken part in round tables with both sets of parents, it is clear to me that, in reality, the system must do both. Children need support, but parents also need arrangements that are realistic, enforceable and trusted. A system that ignores affordability is never going to secure compliance. I found both the round tables that were hosted by some of our staff really emotional. We heard real-life examples of where people had even considered taking their own life because of the financial pressures they were under as they tried to put food on the table and provide for their children. It was heartbreaking. No service is in a good position when you see that as a reality.
A key recommendation is our call for better support for families. As we have heard today, we called for an increase in access to mediation for separating parents—only where appropriate and with the right safeguards, of course—which could increase the effectiveness of child maintenance arrangements. We also recommended improving access to early interventions relating to child maintenance, including information and support; and that these should be part of, or delivered through, services such as family hubs, to which the noble Lord, Lord Farmer, referred.
As the noble Baroness, Lady Coffey, highlighted, the Government’s response is a missed opportunity. It appears to accept that some reform is necessary, but little is going to change quickly. In my opinion, that does not fit with this Government’s absolutely right aspiration to keep children out of poverty. Families are living with the consequences of this system every day. As I say, this issue is not abstract. It is about rent. It is about food. It is about school uniforms. It is about basic home life.
As we stated in our report, over 100,000 children are missing out on maintenance payments every quarter. Just under half of children in families in the collect and pay arrangements, where the Government can take enforcement action, receive no maintenance. Something has to change. This cannot stay in the too-difficult pile any longer or be kicked down the road further, to build on the words of the noble Lord, Lord Farmer. I hope the Minister will take on board the strength of concern in our report, and from Members across the House today, and grasp this issue. I know she cares about it, because she was very passionate when she came before the committee. Children and families cannot be left in this situation any longer. I look forward to the Minister’s response.
Baroness Stedman-Scott (Con)
My Lords, I first declare an interest, in that I was a member of the Public Services Committee. I loved being on that committee—and you will not hear that about many committees, I can tell you—and found it to be a really stimulating experience, so I applaud the chairmanship of the noble Baroness, Lady Morris of Yardley.
Along with my noble friend Lady Coffey, I had responsibility for the Child Maintenance Service when I was at the DWP, and we worked well together on that. I was horrified, and at times incandescent with rage, at the lengths to which people went to avoid paying their child maintenance. If I had the time, I would keep noble Lords here with some of the stories; they would make your hair curl.
When we are talking about child maintenance, it is easy to make the discussion about parents: who owes whom what, whether they are paying on time or the correct amount and, often, how the split occurred in the first place and who is to blame. These conversations and questions are important but also largely tangential. The person at the centre of this is the child. Being a child with parents who split up is not easy. Research shows that children with split parents are more likely to face lower academic achievement, more behavioural or emotional difficulties, a higher risk of economic disadvantage and a strain on relationships later in life. Children from these backgrounds often have to grow up fast to act as mediators between adults who do not have a stable or amicable relationship with one another, and they often feel adrift. Other children go back to their house, but these children go back to mum’s house or dad’s house, never to a place that they can call their home. Children with parents who have not split amicably can suffer even more, and they often face this alone. Being a child in this situation, which they did not choose, can be lonely, upsetting and confusing, and all too often these children can feel like extras in a drama being played out between their parents.
Child maintenance is therefore more than just a payment between adults; it is a mechanism designed to go some way towards addressing the disadvantages that children from broken homes face early in their lives, one of which is a reduced household income if living with a single parent. Ensuring that the child maintenance system works well is therefore fundamentally important and must be an absolute priority for all of us in this Room today.
Given the importance of getting this right, the committee’s report makes deeply concerning reading. It tells us, as others have said, that around 4 million out of 14 million children in the UK live in separated families. That is millions of children whose security and stability may depend, at least in part, on the Child Maintenance System working properly. The report also raises serious concerns about the way that payments are calculated. The formula is now more than 20 years old and is based largely on the income of the paying parent. The committee finds that the system lacks transparency, does not properly reflect the variety of modern family circumstances and may leave room for income to be underreported.
As I understand it, tax evasion is unlawful. Child maintenance evasion should be treated exactly the same. The Government’s own recently published research on child maintenance calculations reinforces many of the committee’s concerns. It found that parents on both sides of the system frequently regard existing arrangements as unfair and that compliance is influenced not only by affordability but by conflict between parents and wider family relationships. That should remind us that confidence in the system depends not only on effective enforcement but on transparency, fairness and the ability of parents to understand how decisions are reached.
I also note the Government’s proposal to reduce the income tolerance threshold from 25% to 15%, as the noble Baroness, Lady Morris, so ably described, so that changes in parents’ earnings are reflected more quickly in maintenance calculations. In principle, that appears to be a sensible attempt to make the system more responsive to real-world income changes. However, it also underlines the broader point made by the committee that the current framework relies heavily on historical data and assumptions that can quickly drift away from a family’s actual circumstances.
It is worth noting that concerns about the calculation framework are not new. Successive reviews have identified questions around fairness, transparency and affordability, and Governments of different political colours have sought to address them. The challenge now is to ensure that this long-running programme of reform is carried forward rather than allowed to drift.
I come to enforcement. My first ever visit as a Minister was to the Child Maintenance Service in Plymouth. It was a massive place with lots of staff, and I talked to them at length about enforcement. The team at the Child Maintenance Service responsible for enforcement in my time was outstanding. Its members deserved all the credit they could get. They never flinched from dealing with situations: it was just that they had too many situations to deal with. If my friend the Minister can do one thing, it should be to get more people into enforcement to get more money for children. If we spent more—here is a Tory talking about spending more—and we calculated the potential return on investment, we could make life better for these young people.
Ultimately, this all comes back to the child. That is why I particularly welcome the committee’s recommendation that the child should be placed at the centre of the calculation formula, with their welfare and future made the paramount consideration. We should remind ourselves that these children did not cause this situation. They did not choose it and did not ask for it, yet they are the ones most profoundly affected by it.
Other recommendations from the report also seem sensible and would allow the system to deliver for children. Improving enforcement, redefining what counts as non-compliance, and giving parents clear and timely updates would all help ensure that more maintenance payments are actually made. It is simply unacceptable that, under the current system, too many parents are able to avoid making payments owed to their children. The evidence shows that this is most often fathers, who on average earn more than mothers, leaving the mothers to carry the financial burden alone.
The committee also pays special attention to vulnerable parents and those who are at risk of financial and domestic abuse, which is most welcome. When someone becomes the receiving parent, they face serious financial costs and are particularly open to the risk of financial abuse. If someone has suffered a difficult separation from a partner, this is heightened even further. Proposals such as allowing direct access to collect and pay for abuse victims are worth consideration by the Government.
There is one further aspect of the committee’s report that deserves particular attention. While child maintenance is often discussed in financial terms, the evidence presented to the committee reminds us that the underlying challenges are frequently relational as much as economic. My noble friend Lord Farmer outlined this eloquently and in a way that we should all be able to understand. That is why I welcome the committee’s emphasis on early intervention and support for separated parents. Helping parents access advice, mediation and practical support at an earlier stage may not only reduce conflict but increase the likelihood of durable arrangements that work in the best interests of children.
Family hubs, which have grown under this Government, have a great impact and effect. Making them the centre, and a place where child maintenance can be discussed and managed, is a no-brainer. I am sure the Minister will take this away and try to make it happen. I hope she does; if not, we will all be on to her.
Ultimately, if we are serious about improving outcomes for children, we must do more than administer payments efficiently; we must also support parents to manage separation in a way that minimises conflict, fulfils parental responsibilities and places the welfare of children above all else. It is important to recognise that many of the issues identified by the committee have been the subject of reform efforts over a number of years. The introduction of the 2012 system under the coalition Government, subsequent work to strengthen enforcement and more recent measures aimed at improving protections for victims of domestic violence or abuse all reflect a recognition that the status quo was and is not good enough. While those reforms have not resolved every problem, they provide a foundation on which further improvements can and should be built.
The report produced by the committee gives the Government some serious food for thought. As a number of noble Lords have observed, lasting reform will require us not only to improve the mechanics of the system but to support families earlier, reduce conflict where possible and help parents make arrangements that put children first. Whether or not children should be properly supported, the fulfilment of parental duties encouraged and vulnerable people recognised are not matters of partisan difference; I know that there is a great deal of sympathy across the House for meaningful change to make sure that these are upheld.
The question for the Government is therefore not whether reform is needed, but whether they will now complete and implement the reforms that have already been identified. Families who depend upon the Child Maintenance Service cannot afford for necessary changes to remain indefinitely under review. I will be listening carefully to the response from the Minister on the concerns that have been raised by everybody who has spoken in this debate and that in the Chamber today.
I thank the committee again for its work—I am sorry that I was not with your Lordships—and for enabling us to have this debate. There is much in the report to command our attention but, my goodness, there is more to do. As the noble Lord, Lord Shipley, said, the work is not complete.
The Minister of State, Department for Work and Pensions (Baroness Sherlock) (Lab)
My Lords, I am grateful to all noble Lords who have spoken and to the Public Services Committee, especially the former chair, my noble friend Lady Morris of Yardley, for her serious work on this. I am also grateful for the detailed and constructive report and express my thanks to the clerks who worked on it and the witnesses who informed it.
The Government share the committee’s focus on two priorities: helping children in separated families to avoid poverty and ensuring that both parents contribute their fair share. As was observed by various noble Lords, children do not choose for their parents to break up, and partners may leave each other, but they do not leave their children. The CMS plays a vital role in improving outcomes for children in separated families.
My noble friend Lady Morris said that I summarised at the end of my appearance—I apologise for what was clearly a long waffle beforehand—that the CMS’s job is
“to get money to kids”.
That is absolutely its job, and it does it: through both family-based arrangements and those made by the CMS, an estimated £2.9 billion is transferred each year to children in separated families, keeping around 120,000 children out of poverty. For clarity, “poverty” here means relative low income after housing costs. As has been pointed out, tackling child poverty is at the heart of this Government’s mission to break down barriers to opportunity. We estimate that the child poverty strategy that has been brought out will lift 550,000 children out of poverty in the final year of this Parliament.
But the committee is right: too many children still do not receive the support that they are due. So this Government have set out ambitions for the CMS to help change this. We want to deliver a fair and trustworthy service that is more accessible to parents, particularly those who are vulnerable, and we want to tackle non-compliance head on by moving to a single, streamlined service, where we can quickly identify and tackle missed payments.
I will try to cover the very range of things I have done in 20 minutes. When I fail, I will write to pick up those questions that I do not manage to answer. Even at the speed I speak, I do not think I will get through them all, but I will try to slow down so that Hansard can pick it up—if not passing dogs.
I say at the start that we all need to be realistic about this. I was struck by the fact that eight of us have spoken, of whom three either are or have been Ministers with responsibility for the Child Maintenance Service, either directly or from a more exalted standpoint. Successive Governments have brought in reforms of different kinds, yet we keep hearing about problems. Our job is to recognise that, when we are dealing with something as challenging as a service that faces parents at probably the worst point in their lives—when their lives have fallen apart and things are incredibly tense—the state needs to step in, as my noble friend Lady Morris said. But we must also recognise that the state cannot solve that problem, so it has to do all it can to encourage and enable parents to support their kids. We will keep pursuing continuous improvement, but I do not want to raise the idea that there is a single silver bullet. If there was, previous Governments would have found it, and the Ministers around this table would certainly have fired it—I have no doubt about that. I will do my best.
Let us talk about the removal of Direct Pay. It absolutely remains our complete and firm intention to legislate to remove Direct Pay, which we estimate could result in around 20,000 fewer children living in poverty. Moving to a single service, where the CMS monitors and transfers payments, will address the long-standing issues highlighted by our research into Direct Pay, including hidden non-compliance and the burden on parents having to chase payments themselves. It will also reduce unwanted contact between parents.
I realise that I have failed completely to persuade the noble Baroness, Lady Coffey, of the case for doing this. I will have a brief go, but I listened carefully to her comments. At the heart of this is the fact that, under the current Direct Pay model, the CMS cannot routinely monitor payments. That means that non-compliance can go undetected unless a parent reports an issue. Our research on this is interesting. It suggests clearly that only 60% of receiving parents report receiving the full amount due and that only 40% get it on time. Direct Pay is not performing brilliantly, and there are problems in Collect and Pay. We now know that Direct Pay is hiding significant amounts of non-compliance, so moving into a single service will enable routine monitoring, allowing earlier identification of missed payments and intervention.
Let us face it: Collect and Pay is made up of previously ineffective Direct Pay cases. Under the previous reforms, you can get into Collect and Pay only if you fail in Direct Pay, so Collect and Pay involves the people who did not manage to make it work in Direct Pay. Collect and Pay shows that, when payment behaviour is visible and enforceable, just over half of parents are fully compliant and a further quarter are partially compliant. Given that those are the difficult cases, that is something we need to hold on to.
Under those reforms, well-functioning Direct Pay cases should carry on. If things are working, there is no reason to assume that they cannot continue in a family-based arrangement, as long as we provide support with the calculation. If they are not working, they come into the main system. That will help compliance, and it will benefit victims and survivors of domestic abuse by removing the need for parents to chase missed payments or engage with each other. We will work closely with domestic abuse organisations to ensure that communications and support are safe, targeted and effective. The reality is that, when Direct Pay is removed, the level of non-compliance we anticipate being revealed could indeed put a bump in the statistics on non-compliant cases. But all that would be doing is surfacing hidden non-compliance in Direct Pay, not creating new levels of non-compliance.
Noble Lords are understandably keen to find out about the timing. As I have said, our firm intention is to remove Direct Pay, but we will have to wait to get primary legislation to do so. I want to make the changes as soon as possible, but the Committee will understand that the Government have a crowded legislative agenda and we have to take our place in that alongside the many other vital reforms that departments are pursuing. We are continuing to develop legislation on a range of matters related to welfare reform and I remain determined to legislate on this and other important matters as soon as parliamentary time allows. In the meantime, we are taking action to make it easier for parents to switch to the Collect and Pay service through our improvements to the change to service type process and being clear in our communication about what support is available for victims and survivors of domestic abuse.
On the additional workload—I have totally failed to persuade the noble Baroness, Lady Coffey, on this, too; my track record is not excellent here, but let me try again—I reassure the Committee that compliant Direct Pay cases require the same amount of work and caseworker resource as compliant cases in Collect and Pay. The main extra cost to DWP as a result of these reforms will be administering previously unidentified non-compliant cases. If the workload goes up, it will get in money from cases that at the moment are simply hidden.
There are also benefits in two other areas. First, some compliant cases will move to family-based arrangements and will not require the CMS to intervene at all. Secondly, the removal of the process of changing them from one to the other accounts for around 1,000 cases a month, and the resources released by ending that burden will be redirected where they are most needed, supporting the increased volume of cases that need support from the CMS.
The noble Lord, Lord Farmer, and others raised domestic abuse. The CMS has substantially strengthened its processes, due in no small part to the work of his supporter, Samantha Callan. I am very grateful for that work, which the department has read and benefited greatly from. We have certainly improved caseworker training and signposting resources, with a dedicated domestic abuse plan for caseworkers to follow in supporting victims. I think the noble Baroness, Lady Coffey, mentioned the Domestic Abuse Act. We know from our research that most victims and survivors of domestic abuse are unlikely to have enough evidence to pass the tests we would have to apply were we to introduce the provisions of that Act. The Act requires the Secretary of State to set out evidence requirements for domestic abuse in regulations. My latest and best advice from officials looking at this in detail is that that evidence would have to be court-based. That is because it would need to be verifiable and, when it is provided, could not be disputed by the other party because it has already been litigated. Someone could try to JR it, but if it has been through the courts that gets more difficult.
For victims and survivors who have enough evidence, we know it can be traumatic for them to relive the abuse by having to produce it and go through it again. We want to avoid that wherever possible. Our priority has to be making the CMS more effective at supporting all victims and survivors engaging directly with the service. However, I want to reassure the Committee that we are not closing the door on this; we will continue to explore evidence-based ways that could allow us to commence the Act in future, should it be needed as part of a broader package.
I turn to the calculation, which my noble friend Lady Morris and many others commented on. We looked carefully at the committee’s recommendations. We recognise that, to secure voluntary compliance, parents need to have faith that the amounts are fair and understand how they are calculated. That is why we conducted a review of the child maintenance calculation, focusing on ensuring that it strikes the right balance between both parents to encourage compliance and secure money for kids.
For the record, I will say what we will and will not be doing on this. Following the review, I am pleased to advise the Committee that we plan to reduce the income tolerance from 25% to 15% so that changes to income are captured more quickly and assessments remain fair to both parents. I hope that makes my noble friend Lady Morris happier. She spoke about things such as rental income; we will include unearned income within the standard calculation, which will ensure that liabilities more accurately reflect parents’ full financial circumstances. Those reforms will help ensure that the system better reflects how families earn and receive income today, helping deliver more consistent support for children.
We looked carefully at the committee’s recommendations on how child maintenance is calculated. While we agree with the spirit of many of them, we will not be adopting them, which I know will be disappointing. For example, we know from the experience of before the child support system was introduced that the family court approach added complexity, created delays and reduced the number of children able to benefit from maintenance. We are determined to avoid that. I take the points made by the noble Baroness, Lady Deech, whose expertise obviously far exceeds mine in this area. However, having looked at the problems created—this was the reason the administrative system was introduced in the first place—we do not feel that that is the way forward.
I will say that there are ways in which the court can do things. Parents are not obliged to use the CMS. They can, if they both choose, make their own arrangements or seek an order through the courts if they agree. Once a court order for child maintenance is in place, after 12 months someone can choose to come to the CMS. The courts also play a role where receiving parents want top-up above the threshold for the Commons, but we think that, fundamentally, for the bulk of parents an administrative system is the way forward.
We looked at whether more significant changes to the calculation, including changes to the rates and thresholds, would deliver the improvements in fairness and compliance that we wanted. As part of this, we undertook extensive research with users of the service, which has now been published, to understand how parents’ behaviours may be impacted by potential changes. Having carefully considered that research and other evidence through the review, it is clear that the case for proceeding with such large-scale change is currently not sufficiently strong. We will therefore not be moving to reform rates and thresholds at this time.
We are confident that the current approach, which uses HMRC income information to assess liabilities, provides stability and certainty for parents, subject to the changes that I have mentioned about the sensitivity threshold and types of unearned income. It gives us the flexibility to reflect a parent’s current income in the calculation where appropriate, which we can verify using real-time information for PAYE-paying parents. Alongside that, the variation process plays a crucial role; it allows parents to ask us to consider income or expenses falling outside the standard calculation, so that works better.
I am conscious of time, but I shall say another word on that. The judgment was in the end that the sharp end of the calculation is essentially a zero-sum game. If the amount of money due for one parent goes up, that received by the other parent goes down. That means that any reform affects the whole case load in extraordinarily different ways, and makes it very difficult to target any changes that would reliably ease affordability for the right parents without substantially reducing liability for many parents who are only just managing to support their children at existing levels.
The evidence that we have found does not demonstrate that the reform of rates of thresholds would deliver a meaningful improvement in the amount of maintenance paid. For example, we looked at making a change in the form of a hypothetical increase to the flat rate. Both receiving and paying parents felt that the change would have limited impact: receiving parents genuinely viewed modest increases as not enough to make a meaningful difference; paying parents felt that even a small increase would add to financial strain and be difficult to manage. In the end, we felt that this was not the time to do it. Changing liabilities during a period of continued cost of living pressures could inadvertently risk destabilising existing arrangements and result in lower compliance. I recognise that that is a disappointment to the Committee, but I wanted to be clear about opposition on that.
I turn to another favourite subject, implementing administrative liability orders. Work is still under way to implement ALOs. As the Committee knows, while child maintenance is reserved, enforcement in Scotland has to be carried out through the Scottish judicial system, which is devolved. We are working very closely with His Majesty’s Courts and Tribunals Service and the Scottish Government to get ALOs operating across Great Britain, and we will introduce the necessary legislation as soon as possible.
Just to be clear, it is the Scottish judicial system through which we would have to implement this, but there are complexities there. It turns out that uncoupling the liability order from the rather complex Scottish judicial process while retaining the ability to exercise the full range of enforcement measures through Scottish courts has proven significantly more challenging than I assume was envisaged when work began on commencing the powers in the 2023 Act by the noble Baroness, Lady Coffey. My department is working closely with the Office of the Advocate General and other key powers in the Scottish judicial system to find a solution that works that for everyone. I have personally spoken with the Advocate-General to make sure that we have her full support.
In response to the noble Baroness, Lady Coffey, I looked at commencing the powers in different parts of the UK at different times but, as it turns out, that simply creates different legal problems and operational challenges, as well as meaning that not everyone benefits. Nobody wants this to be implemented quickly more than I do; as soon as it possibly can be, it will be.
I want to clarify one thing on enforcement. The idea that there is no enforcement if you pay anything at all is simply not true. Stats are collected on those who pay anything to show compliance. There are technical reasons for not using stats showing 100% compliance or not, which I think we explained to the committee at times—but essentially I can write and explain that in detail, if it is helpful. There are technical reasons why parents who are in fact paying what we tell them may not show as paying 100% compliance, which both my predecessors as Ministers will understand. I should be happy to write if it was helpful to pursue that.
Also on enforcement, I am absolutely with the noble Baroness, Lady Stedman-Scott: I, too, have been shocked by the extent to which some people will go to avoid paying for their children. Having said that, I want to say that most parents want to do the right thing: they want to pay for their children and pay up, and our job is to help them to do it—but where they do not, it is right to go after them. Like the noble Baroness, I have been so impressed by the colleagues that I have met. I have visited child maintenance offices and our enforcement colleagues are doing everything that they can: they are brilliant, and I am grateful to the noble Baroness for saying that. The CMS has lots of fantastic staff and brilliant leadership, determined to keep driving for improvement, and it is really nice to hear that said, because otherwise they hear all the criticisms, as if we do not know the really good work that they do and how hard they work. There is not much more that I can say on that in the short term.
Let me try to rattle through things in my remaining four minutes. The noble Lord, Lord Farmer, and the noble Baronesses, Lady Pidgeon and Lady Stedman-Scott, asked some excellent questions about supporting parents. Noble Lords may be interested to know that we are looking at a range of new tools and guidance to support separated families, to help them make informed financial decisions and to help them choose the best option for them. These include enhancing the online calculator, by aligning it more closely with the statutory application to strengthen confidence in the estimates, and providing better ongoing support for family-based arrangements. When the reforms to abolish Direct Pay go ahead, parents will be given information to help them judge the suitability of a family-based operation, as well as on how to go ahead with the CMS if that is the way that they want to go. We are also working across government with the Ministry of Justice to look at how it is developing digital tools for post-separation contact and to make sure that it can align with what the CMS is doing, in order to support parents in making safe and sustainable family-based arrangements.
The noble Baroness, Lady Pidgeon, and the noble Lord, Lord Farmer, mentioned family hubs. The family hub presence should offer universal materials and information about how to book on to services for separated families, including signposting parents to the Child Maintenance Service. The hubs are deliberately designed to be a gateway to the full range of support that families need, so every hub will connect families to debt advice, welfare support, housing support and support with the cost of living. Child maintenance officials are working really closely with DfE colleagues to identify all the opportunities to share information about the CMS through the family hubs, so that they can do that. This is a really great opportunity. Obviously, because it is for everybody, we hope that it will also reach those parents; we are really working on that.
The noble Lord, Lord Farmer, also asked what we are doing to increase confidence in the CMS. There are two things here. First, despite what we have heard here today, we need to be clear that, although there are hard cases that test the service, overall, the service is much better than it used to be and most people’s cases run reasonably smoothly. People are still applying in large numbers. In fact, there has been an increase: as of last December, we are at almost 800,000 cases, up from 640,000 just three years earlier. So large numbers of people are coming and using the service and, within that, compliance has been going up.
We are not complacent, but I do work really hard to reach out. I run surgeries for MPs. We engage with stakeholder organisations. We go out there and talk. We are doing a lot. The CMS’s modernisation programme is also doing a lot to communicate with parents and to make it easier for them to find information. It is running targeted social media campaigns, including signposting people to tools and trying to move things along. We need to get the word out there: “The CMS is there for you, and it works”.
I may have to write on the mediation voucher but, again, I am really pleased with how it is going; I am grateful to the noble Lord for acknowledging that. The scheme is working well and has been heavily promoted.
I have only 15 seconds left. The noble Baroness, Lady Coffey, mentioned back-to-work employment. The Government are committed to supporting people into work; I will not go through all of that, but we are doing a huge amount there. However, survey evidence and CMS calculations suggest that the majority of paying parents are in work, so our job is to support them in this.
I am running out of time; I have only 10 seconds left. Let me simply say how grateful I am to the committee for its work and how determined I am to make this service work. The noble Baroness, Lady Morris, started by saying that I care about this issue; I am grateful to the noble Baroness, Lady Pidgeon, for acknowledging that. I absolutely do care, and I know that my whole department and the leadership of the CMS do too. We are determined to make this service the best it possibly can be; children and parents need it, and we will make it work.
Baroness Morris of Yardley (Lab)
My Lords, in responding briefly to the debate, I would first like to thank everybody who contributed. There is a wealth of knowledge and experience in this Room today. We made the same point about wishing to reform the system and make it better for children and parents. With that kind of background, we should be able to make progress; I hope that we might see some in years to come.
The Minister’s response was as full, open and honest as ever. I can only speak personally but I am always grateful that it is the noble Baroness, Lady Sherlock, who has this job. This is such an important area, and I trust no one more than I trust her to try to get it right; that is the background and the amount of trust that I have in the noble Baroness’s leadership role.
Having said that, this is a really tough issue. As the noble Baroness, Lady Deech, pointed out—the committee also felt this—if you have the money and the wherewithal to go to court and have your system looked at individually, you will not suffer a lot of the things that we have been complaining about today. If you have to use the state-run system, it cannot treat you as an individual; it treats you using a formula. That is the problem that we have.
Given that those are the circumstances, all I will say is that of all the services this system needs to be the best that the state can offer, but I do not think it is. My worry about the Minister’s response is that they need to bite the bullet on this issue and go for big change. That is my gut feeling, having been a chair of this inquiry for a couple of months. I will have to reflect on whether what the Minister said—about having limited changes to the calculation and the formula, limited changes to enforcement and no movement yet on administrative liability orders—amounts to the radical change that needs to happen.
I say this from my own experience as a Minister: you can never have radical change without hurting someone. If you are going to hang around till you have an answer where no one is a loser, you will never change anything. My one word of warning is that my judgment, and I think that of the committee, is that radical change is needed. It will not be done without pain to someone, but that will be less pain than we have in the system at the moment. Having said that, I am very grateful. I wish the Minister and her team well and hope that, collectively, we can pursue this in another forum.
The Building Safety Regulator: Building a Better Regulator (Industry and Regulators Committee Report)
(1 day, 5 hours ago)
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Baroness Taylor of Bolton
That the Grand Committee takes note of the Report from the Industry and Regulators Committee The Building Safety Regulator: Building a Better Regulator (2nd Report, HL Paper 225, Session 2024–26).
Baroness Taylor of Bolton (Lab)
My Lords, I am pleased to introduce this debate on the report The Building Safety Regulator: Building a Better Regulator, which was published by the Industry and Regulators Committee in early December. As is often the case, we have to wait some time for these debates, but the issues that we raised are still very relevant.
I place on record my thanks to members of the committee and our whole team for the work that they have done. I particularly mention the noble Lord, Lord Best, who was the first person to alert us to the problems that we should be looking into as a committee. I also thank Dominic Cooper, our researcher, for the sterling work that he put in.
There is a wealth of experience in this Room. My noble friend Lord Roe will give us the insider’s view, my noble friend Lady Warwick will talk about social housing, and there is a wealth of experience from local government and elsewhere. However, we should start off this debate by remembering the 72 people who died in the Grenfell Tower fire. This coming Sunday will be the ninth anniversary of that tragedy and, as the Minister told us, remembering that is at the heart of everything we do. We have to remember the 72 people who lost their lives and those who were bereaved and who survived them. It was a very significant event.
The inquiry that followed that tragedy found that the regulatory arrangements for the construction industry were too complex and fragmented. In many cases, they allowed the industry to choose its regulator, creating a commercial incentive not to regulate too strongly. As part of efforts to ensure that such an event could not happen again, Dame Judith Hackitt’s independent review recommended the establishment of a new regulatory framework to oversee building safety in higher risk buildings. Consequently, Parliament legislated, with all-party support, to create this new framework in the Building Safety Act 2022, which gave this responsibility to the Building Safety Regulator set up within the Health and Safety Executive.
The Act gave the BSR responsibility for approving safe construction of new higher risk buildings and construction work within existing higher risk buildings. This was to ensure that compliance with building regulations would be assessed by an independent regulator rather than by the complex framework that existed with local authorities or private sector building control approvers. The establishment of the Building Safety Regulator and its regulatory framework was necessary and it was welcomed quite significantly. The committee heard some evidence that the BSR was improving safety by requiring greater consideration of safe design and management by the housing industry. However, the overwhelming impression the committee got was that the BSR’s current impact is that it has caused widespread delays to both the delivery of new housing and the improvement of existing higher rise buildings, including the remuneration of dangerous cladding.
The BSR’s statutory timeframe for making building control decisions for existing buildings is eight weeks, and for new build it is 12 weeks. Its own data shows that it takes, on average, much longer than the statutory timelines, and we have heard that many applicants were waiting up to a year for very significant decisions. This has threatened the viability of new housebuilding in cities and left residents in unsafe buildings for longer than necessary. It does not make anyone safer if we fail to deliver new housing in overcrowded cities or leave residents waiting longer for remediation of their unsafe buildings. We heard from one leaseholder, Pamela Street, that residents in her building
“have quite simply had enough”,
after their application was delayed when the building was identified as needing work in 2019. Many others have had to live with uncertainty and seemingly open-ended financial commitments for work that might have to be done.
There are reasons for these delays but, whatever they are, this level of performance is entirely unacceptable. During our inquiries, the Government and the Building Safety Regulator recognised these problems and began to make practical improvements, which I will mention. The committee welcomed this. However, the BSR admitted that, even after these changes, it may fall short of meeting its statutory timeframes. This will not banish the anxiety or frustration that residents and companies are already experiencing, so I ask the Minister to update the Committee on when the Government expect the Building Safety Regulator to meet its statutory timeframes for making decisions.
We heard several reasons for these delays. Initially, the Building Safety Regulator seconded in members of multidisciplinary teams to make building control decisions, leading to delays in setting up those teams in the first place. The BSR is now increasing its in-house capacity following government investment, which is a significant and positive move. However, this sits within the broader shortage of building and fire inspectors to staff the BSR and other related organisations, such as local building control authorities and fire and rescue services. The Government have made £70 million of additional funding available to address these shortages in building safety personnel, which must be welcomed. The planned construction action plan is also welcome, but it needs to have the long-term funding necessary to increase this capacity. I hope the Minister will be willing to update the House on a regular basis about progress that can be made in this respect.
Another key issue was that the construction industry did not understand what information it needed to provide for the BSR to approve its projects. That was compounded by the Building Safety Regulator, certainly in the early days, not communicating clearly with applicants about their projects. It is unreasonable to expect applicants to meet a standard when it is not clear how it is assessed or what a successful application would look like. We heard that progress had been made during our inquiry, with the BSR beginning to provide greater guidance and increasing communication with applicants. How confident are the Government that the BSR has now given sufficient guidance to make its requirements clear?
However, not all the problems are on one side. The Building Safety Regulator has expressed concerns about the capability of the construction industry to meet its requirements, arguing that the requirements of the building regulations have not changed, only the way in which they are assessed. The BSR gave examples of the reasons why it has rejected applications, including an inability to show how buildings had been designed to avoid collapse, which sounds very basic to me, and a common issue whereby applicants’ own computer modelling showed that smoke would be pumped into fire exits rather than extracted. While the BSR must improve its own performance and provide clear guidance, it does not reflect well on the construction industry that many applications are rejected or delayed due to basic errors and an inability to evidence information on central elements of fire and structural safety. The Government have since consulted on their strategy for the built environment professions, and I hope the Minister can tell us when they will announce reforms to ensure that industry can play its full part in improving the safety of buildings.
So we have a situation where the BSR’s own processes contributed to delays and where industry complained that a significant amount of design information was required up front before construction could begin. This was a necessary change from the previous situation, where developers could decide and change critical features after construction had commenced. However, we felt that the BSR overcorrected for this problem and we welcome that it is planning to take a more staged approach to approvals, allowing construction to begin without requiring the full design of non-safety critical features. The balance has to be carefully assessed, because both factors are important.
Of course, our report is not just about new build. We heard significant frustration from leaseholders that smaller, less safety-critical works to their properties, including domestic renovations, required approval from the BSR, and that could often lead to significant delays and a significant increase in the costs of projects. It also tied up in-demand safety professionals on more minor works. So we called upon the Government to remove less safety-critical works from the BSR approval process or to provide a more streamlined approach to them. The Government are consulting on taking a more proportionate approach to works inside individual flats and small-scale works in communal areas, such as the replacement of fire doors, but keeping them within the BSR framework. That would be welcome, and we are hoping that the Government can move swiftly to implement those proposals.
I turn to the products involved. The use of combustible cladding and insulation at Grenfell Tower shows that the quality of construction products is critical to the safety of a building, but the regulation of construction products is patchy and fragmented. The Government have consulted on their initial proposals for improving construction product regulation. We were pleased at that and support it, particularly the introduction of a generalised safety requirement to ensure that all products are covered by at least some regulation. It is urgent that people can trust the materials that their buildings are made of. Again, I hope the Minister can update us on when the Government will take these plans forward.
The Government have taken action, changing the leadership of the BSR, including by installing my noble friend Lord Roe, and we welcome that. The Government have also provided additional investment in BSR staffing and removed it from the Health and Safety Executive to set it up as a stand-alone agency, which are steps in the right direction. This is a move toward introducing a single construction regulator, as recommended by the Grenfell Tower Inquiry. We welcome this as it will provide greater clarity and consistency in the regulation of the industry, but there is still a lot to do. The Sunday Times said yesterday that there are still over 400,000 people living in flats with fire risk and that only 21% to 26% of buildings known or estimated to have unsafe cladding have actually been fixed. So a start has been made but further action has to be taken, and it is planned in a number of the areas that we have raised. We welcome that but we think there is still a long way to go to avoid another tragedy happening.
Moreover, and this point is very important, without further action from the Government and indeed from the BSR, there is little chance that the Government will be able to meet their target to build new homes and to remove dangerous cladding, and a failure to meet either of those challenges will leave people living in unsafe conditions for longer. I know that the Minister is engaged and aware of these problems, and we welcome the fact that some action has already been taken during the time since our report was published, but we have to keep on top of this issue because it is still a serious problem that many people are facing. I beg to move that the report be considered.
Baroness Harding of Winscombe (Con)
My Lords, it is an honour to follow our erstwhile chair of the Industry and Regulators Committee. I begin by declaring my interest as a member of that committee.
I thank the noble Baroness, Lady Taylor of Bolton, for her excellent chairing of both the committee as a whole and this inquiry; I have to be careful about how much I say we miss her because her successor, who is also doing an excellent job, is sitting just beside her. I shall try very hard not to repeat the noble Baroness’s excellent, clear and comprehensive introduction, which really set out the content of the committee’s report, with which I wholeheartedly agree. I also thank the clerk and the staff who worked so hard on producing this report and who continue to support the committee so well.
As the noble Baroness, Lady Taylor, just said, the Building Safety Regulator was created as a direct result of the tragedy of Grenfell Tower nine years ago. It was a clearly necessary and welcome step, and it demonstrated a clear regulatory gap that had absolutely tragic consequences. However, this time last year, when we as a committee started to investigate the performance of the Building Safety Regulator, it was also clear that the recommendations from the Grenfell Tower Inquiry had not been implemented very well at all.
That was causing material harm in and of itself. Remediation was nowhere near on track. Unsafe buildings remained unsafe—and, sadly, still remain so today. Tenants are stuck, unable to move on with their lives, and unable to do basic DIY. Frankly, they are still scared, too. So it is a thoroughly unsatisfactory situation in terms of remediation, as well as a real handbrake on development in a country that desperately needs new housing. That is something with which all of us on all sides agree, as does everyone else in the country—except, sadly, when it actually involves each of our local areas, but that is a different issue.
We had a regulator that was set up with the best possible intent and with genuine cross-party support but was simply failing in its job. In our political process, when we debate Select Committee reports, even though it takes quite a long time to get here, as the noble Baroness said, my experience is that, often, nothing much has changed. Even though it might be a year since it came out, we can pick up the report and carry on the debate as we have done. This is an unusual instance where that is not the case and where I need to congratulate the Government on acting. I wait, as I suspect others do, to hear from the noble Lord, Lord Roe, for a proper, up-to-the-minute update on the performance of the regulator, but, based on a basic measure of the number of emails I have received from organisations lobbying in this space, as compared to the number of emails I received this time last year when we initiated the inquiry, I have to conclude that an awful lot of the noise has died down, which suggests that there is real movement and improvement. That is something we should mark.
I will try hard in the rest of my speech not to go back over what the noble Baroness has just set out but to look forward. First, it is clear that a beginning has been made. It is hugely tempting—just as when the regulator was first set up—to assume that, once you have said it, it exists. An awful lot of good things have started, but they need to finish. I echo the noble Baroness’s question on when the Building Safety Regulator will meet its operational KPIs. It is definitely improving, but when it meet them? When will the Government bring forward the necessary changes in legislation to enable some of the high-volume, low-risk work to be moved out of the scope of the BSR so that it can focus on where it will really make a difference? When will we know what the path to create a single construction regulator will look like? That is where I would really like to focus: on the lessons learned. The Government undoubtedly embarked on creating a new, bigger regulator, because this is a tale of creating a regulator not going very well at all.
I have tried to pull out the big lessons that I would like us to learn. The first is that it was clear that culture change was, and still is, needed in this industry. However, the approach taken was to assume that that culture change can be created without the regulator engaging directly with the industry at all: “The industry can’t be trusted, so we’re not going to engage with it”. That does not create culture change. Culture change is created by grown-up, adult discussions with a regulator that retains its independence but has the courage and capability to talk to the industry; I believe that that is what the noble Lord, Lord Roe, and his team have started but, my goodness, we must not forget that. After you have seen the sort of regulatory failures that were in the construction industry, it is very easy to assume that the same mistakes will be repeated, but you need active engagement between the regulator and the industry to create change.
Secondly, the operational performance of the regulator really does matter. The moment in the inquiry that depressed me most was when we took evidence from the then leaders of the Building Safety Regulator. They told us not only that they were missing their operational KPIs by a very long way but that, even with their best endeavours, in several months’ time, they might get to missing them by only a few weeks. That is just not good enough. If we want regulators to perform, we in Parliament and the Government need to hold them to account for delivering their operational performance. This means that we need to think very carefully about what those KPIs are because, if they get so accustomed to missing them that it is okay to say in Parliament, “Never mind, we’ll get better but we won’t actually get there”, we have a real problem.
My third learning is that, if you are going to create a new regulator, you must resource it properly. The unintended consequences of great intentions that are poorly resourced are worse than not doing anything at all. If we are going to set up a single construction regulator, we have to do it properly and set targets with a line of sight to the resources so that we are capable of meeting them. I talk about a line of sight to the resources. It requires us to think about not just the money but the skills. One of the biggest problems that the BSR faced was the lack of a supply chain of people with the required skills to join its multidisciplinary teams. There is a role for the Government in thinking through the end-to-end supply chain of talent and capability to meet these standards.
Finally, there are unintended consequences of regulation. I am certain that, four or five years ago, when they were setting up the BSR, officials tried to work this through in advance, but, no matter how hard they tried, it quickly became obvious that the BSR was not fit for purpose. This means that you need a very rapid review after you have started the journey of building a new regulator. If we as a country are about to embark on setting up a single construction regulator, will the Government commit to a review within 12 months of it being set up?
I would like to think that the committee of which I am a proud member did an outstanding job in writing this report, but I do not think that it was actually that difficult: it was pretty obvious what was wrong, and most people already knew that. We could have got to grips with those changes earlier if we had had a government-led review within 12 months of the BSR beginning. Everyone would have said the same things, and we would have had a head start on trying to fix the problems. By definition, I do not know what the unintended consequences of setting up a single construction regulator will be, but I am sure that there will be some, so I urge the Government to set up that rapid review process so that they can catch things before they do too much harm.
I have nearly come to the end; I promised that I would not speak for too long. This might feel like minutiae but we are living in a world where getting the balance between enabling the market to solve some of our fundamental problems and protecting our citizens from dreadful harms, of which this is a great example, shows that the minutiae of setting up a regulator properly can make or break some big things in this country. Sadly, when the BSR was set up, we did not get that right. We must learn from those mistakes.
Lord Best (CB)
My Lords, I too was delighted to be a member of the Industry and Regulators Committee that produced this report. I also thank the clerk and the team who looked after us. They did an absolutely brilliant job. What we discovered six months ago has been brilliantly explained by our esteemed then chair, the noble Baroness, Lady Taylor of Bolton. I would just like to summarise our findings.
First, the ghastly Grenfell Tower tragedy revealed the long-overdue need for expert, decisive regulation for building safety. Secondly, the Government’s response in establishing the Building Safety Regulator had floundered and the BSR urgently needed to improve its performance. Thirdly, the Government were seized of the urgency of this situation and, not least with the appointment of the noble Lord, Lord Roe of West Wickham, as the new BSR chair—I am delighted to see him here—there were important signs of real progress in clearing the backlog and achieving faster and more effective regulation. I am sure we will hear more of this progress tonight.
This story is not one of a need for deregulation. No one would wish us to return to a system that allowed dangerous practices across the construction industry. Rather, it is about speedy and effective regulation. The BSR in its initial form was opaque in its requirements and irresponsibly slow in its decision-making. The new-look BSR is not about deregulation but about better regulation, as I am sure this debate will make clear.
I would like to raise the related issue of regulation of construction products, which the noble Baroness, Lady Taylor of Bolton, has touched on. The BSR is not directly responsible for this. The task falls to the Office for Product Safety and Standards, the OPSS, located within the Department for Business and Trade, which has the duty of protecting
“people and places from product-related harm”.
Dame Judith Hackitt’s 2017 review had found the process for testing and certifying products for use in construction is
“disjointed, confusing, unhelpful, and lacks any sort of transparency”.
It is clearly impossible for the BSR to make buildings safe if the products being used are unsafe. In one of our debates on the Grenfell disaster, the noble Lord, Lord Porter of Spalding, told us how the tiles for cladding were used as the best fuel for bonfires on construction sites, with those working in construction entirely familiar with just how inflammable—and therefore dangerous—these products could be. Yet there they were on the face of the tallest buildings, which were the least likely to cope with a serious fire.
The Grenfell Tower Inquiry’s phase 2 report, published last September, argued that there was systemic dishonesty on the part of those who made and sold the cladding panels and insulation products as used on the building. The phase 2 report suggested enhanced arrangements for regulating construction products. Samantha Dixon, the Minister for Building Safety, told our committee that the plans to establish a single construction regulator would include greater regulation of construction products. Could the Minister update us on progress in achieving a new regime for regulating construction products?
There was good news last summer in the extension of government support to cover the remediation costs of social rented homes in buildings over 11 metres. The cost is being largely covered by the original builders that are still in business and by the building safety levy. Are there now plans to go further and compensate occupiers for safety measures in buildings that are less than 11 metres high but which have life-critical safety defects, as certified by qualified fire engineers? Can we expect support for the unfortunate shared owners and leaseholders, some still facing truly ruinous bills, in these less tall but just as unsafe homes? An update from the Minister would be much appreciated.
Lord Roe of West Wickham (Lab)
My Lords, I thank the noble Baroness, Lady Taylor of Bolton, for the opportunity to speak in this debate and for the invaluable work of the committee when she was its chair. I say that on behalf of the regulator; I declare an interest as its chair. The report was enormously important and a very useful lever to drive forward what has been a fundamental process of change. Since sitting in front of the committee—perhaps I would say this—we as a regulator have undergone a fundamental process of change in just about every area of operation, including culture. I will speak to that to provide some reassurance on these well-placed questions and concerns.
I acknowledge that the problems that the noble Baroness spoke to in opening were entirely real. I do not intend to debate that. Last July, I was given a job to do because of those problems and because the Government had recognised that there was certainly a job to be done to improve the regulator. When I took over the regulator, which was still within the HSE at that point, there was a backlog of around 33,000 homes stuck in the application pipeline. I think it is fair to say that there had been a disproportionate impact on housing starts in London. Those two things are undeniable and inexcusable in the context of a regulator that should perhaps have paid more due regard to proportionality and the duties of a regulator to understand its economic impact.
I am in violent agreement with the position stated by all previous speakers that, basically, not having a home does not make you safer. We have to be an enabling regulator because there is a dire need for housing in this country. As someone who, in a previous life, ran one of the largest emergency services in the world, I can tell the Committee that poor access to housing creates as great a danger as living in dangerous housing. I do not say that hypothetically: it is there in the statistics. People very often die, sadly, in crowded and inappropriately converted accommodation. I agree with all of that.
In that spirit, I draw the Committee’s attention to some of the data which shows that there has been a sustained change at the regulator, particularly concerning new builds. The committee provided us with some very well-made challenges. The first was that there was a lack of transparency. We now publish data monthly which shows both the trajectory of change and the remaining challenges. I will come to some of those. We do that openly and in good faith, and we provide a detailed narrative alongside it. If noble Lords go on to the BSR or MHCLG web pages, they will see how things have been improving, month by month.
When I sat in front of the committee, there was a 30% approval rate for applications, which spoke to the lack of available guidance and the confusion that surrounded the regulations. It probably said something about the relationship between the industry and the regulator—a lack of communication, mutual respect and understanding that, in the end, the construction sector will deliver the homes and it is our job to hold it to account, enable it and pull standards up. The average approval rate across all parts of the BSR system is now sitting at more than 75%. I do not believe that that is because we have gone soft; it is because we have helped drive standards upwards. That is above 75% across every single part of the system.
I turn to the innovation unit, as it is termed—it is actually just the centralised model, which previous speakers talked about—where we have taken control of our own MDTs and are directing them more assertively. In the past month, 90% of all decisions delivered by the innovation unit were approvals, whereas previously we were invalidating applications, sometimes at the six-month point, because they were missing documents or there was something not quite right in the way the application was put in. It was completely inappropriate to leave people delayed in that way. We are now making determinations within a week for invalid—that is, missing—parts of an application process.
In London last month, 100% of all applications across 19 case decisions were approvals. In remediation, the approval rate is up to 79% on average, and we are motoring through them now. Across all categories, as I have said, we are up to 75%. More than 10,000 housing units were approved in the past 12 weeks. When I sat in front of the committee, the median for a determination was 43 weeks nationally and 48 in London. Obviously, that speaks to even greater delays at the wrong end of that—people who had put in entirely valid applications but had been waiting and waiting. The median approval time is now down to 22 weeks.
I would like to talk about the KPIs at some point within the next nine minutes. There is a principal point here about how those KPIs were first come to and whether, in the opinion of both the industry and the regulator, they would ever be achievable. If you were to sit with some of the CEOs of the major constructors in this country, they would tell you that they do not need me, along with my colleagues, to rush to those 12 weeks. I suggest that it might force some illogical, cliff-edge-style regulatory decisions. I will come back to that.
We are down to a 22-week median approval time now. It could be lower, I think around 15 to 18 weeks, depending on the complexity of an application. Do not forget that our regulatory remit is everything from a single 12-storey tower block right through to the Shard. As one could imagine, it is highly unlikely that you would reach a decision on the Shard in 12 weeks. We have schemes of very significant complexity and scale—multi-tower schemes or those of more than a thousand housing units—alongside those single blocks. For single blocks, we could probably get close to 12 weeks, but I would argue that we would not be doing anyone any favours to rush towards 12 weeks for the larger and more complex schemes, and that is why the median time is at 22 weeks: there is a balance between approval, rejection and the amount of time.
The reason that it is 22 now is that we are working with developers on a weekly basis to guide them, to help pull up the standards of design and to challenge where necessary. We are doing that in a transparent and recorded way, but in an environment of positive communication. I would like to see the time come down, but I would be a bit cautious about suggesting a blind rush to a KPI that was designed by people who perhaps had not fully understood how hard it is to design something of that scale and complexity in advance. Noble Lords do not have to take just my word for that; the industry would probably say the same thing. It really wants regulatory certainty, and that is what we have given it, because that 22-week median has held solid for months now. I would like to see it come down further. We need to come back to some stuff around engineering design decisions, which I will describe in a minute, because they will help us get it down, particularly for complex case applications.
Noble Lords were absolutely right about guidance. We are bang to rights. If people are not told what to bring, how on earth could they be expected to make a good application? The guidance out there now is significant, considerable and, more importantly, co-authored with the industry. To go back to the principle, the noble Baroness, Lady Harding, is absolutely right: we want people who are experts in building buildings, who are in the industry—whatever story might have been told in public—to improve it. My experience is that the Construction Leadership Council led by Mark Reynolds is owed a great deal of thanks for helping us to improve as a regulator. Working with the CLC and the industry to produce industry-relevant guidance based on best engineering practice has helped to drive that approval rate up, because people are now coming into the application process understanding what we need and what best practice looks like. That has been from a joint effort with industry, and the results speak for themselves.
There was an absence of good guidance in the remediation space, where there are some complexities, particularly around facade engineering and the level of expertise available in the country. That has radically shifted again and we have a 79% approval rate now because—again, to its credit—the industry has worked hard with the regulator to produce guidance and videos. There will be more on that by 22 June, as we start to ramp up our remediation programme.
Just for information, I shall talk about things that have worked. One is centralising teams—getting control of MDTs. I talked about picking a football team where you did not know what pitch you were playing on or who was on your team. That was the old model, and that has gone. We do not do any of the franchise MDT work anymore in any part of our systems. Either it is delivered through a centralised team process where we control it—that is, we have direct control of fire engineers, structural engineers, geospatial and building control specialists—or we have private sector contracts with the big engineering companies where we batch out applications under very strict regulatory oversight, so we control what goes in, and we have oversight of the information that those engineering concerns are taking in and making determinations on. At the end of the day, the legal decision has to lie with the regulator. Our experience is that that has provided great contingency and additional capacity that, again, brings times down.
Obviously the biggest improvement has been in the new-build space, and what we have done there has to be repeated in remediation. We are beginning to see that now but, frankly, it took us up until just after Christmas to clear the backlog in new build, and then we turned our gaze to remediation, but we are now starting to see that accelerate. That is good because, with credit to the Minister and the department, we are now seeing real pressure being brought to bear, both through the grant system and in the relationship with developers through the developer contract, to speed up applications into the process. We are seeing a considerable uptick in the number of applications coming into the remediation process. We have to keep pace with that, and my assurance to the Committee is that we will.
We have been recruiting at pace and are building new contracts at pace with big engineering firms to focus specifically on remediation. We now have a full-time centralised team fully established inside the remediation space for applications. They have their first 50 applications now as a new unit and are working their way through. So, even in the context of some of the problems that previous speakers have described, we had started improving anyway just by improving communication, relationships, guidance process and general grip. Now that we are resourcing up, I think that again we will continue to see an improving trajectory.
On problems within categories A and B, we will come back to the principles around refurbishment in those categories. I apologise—I am conscious that I am running out of time, so I will wrap up as quickly as possible.
I have a dedicated NHS team. It was inexcusable to me that we were holding up hospital refurbishment and improvements. We have broadly dealt with that by just establishing a dedicated NHS team, which is probably worth knowing about. Probably, like my colleague the Minister, I am measuring the success of that by the far more limited emails that I now get in my inbox directly from the CEOs of NHS trusts.
If the Committee might indulge me going a minute over my time, I would like to talk about the remaining challenges, because it is worth being honest with noble Lords. On the remaining challenges, we are now doing what we should do as a regulator, because we have dealt with the bureaucratic failures. We are not refusing to reply to emails; now we are meeting developers weekly. We have a dedicated account management function that will be meeting all the big developers and the majority of SMEs on a weekly and monthly basis to problem-solve. That is all great, but we have realised that we need better industry-wide benchmarks, commonly understood with the regulator, about engineering principles. As much as I love lawyers and engineers, if you put the two in a room, they will have a different opinion, whether on our side, on the applicant’s side or even within either entity. That is what we are finding, and it is extending determination times, so we are doing something about it. We have appointed independent chairs of the statutory committees, and we have set up internal panels to allow for third-party challenge.
We are dealing with some of the big issues—for example, around structural engineering calculations and design ideologies—that are really bothering the industry at the moment. We need to have a reset in the back regime. I would be happy to come back to the Committee or to report in future debates on what we are doing there, but that is imminent, because that system still is not functioning as we would want it and we want to turn it to a risk-based inspection programme, to put it broadly, rather than calling them all in, which is what we do at the moment and places an undue burden.
I am grateful to the Minister and the department for supporting us in rationalising the category A and B refurbishment regime, and we are a long way down that road now. I expect to see the results of that coming through consultation, and therefore a change to our operations. I am sorry for the rush through; I probably could have said more about change, but I hope it has given the Committee a sense of what we have been doing that is evidenced in the numbers, rather than just empty promises. I would welcome the opportunity to speak again as we drive further change forward.
Lord Fuller (Con)
My Lords, it is an honour to follow the noble Lord, Lord Roe of West Wickham, whom we know has unparalleled expertise of not just the regulator but the service, in defence of safety and security in London. I declare that I am a member of the Industry and Regulators Committee, but I joined after this report was published. Nevertheless, I manage a residential block of flats in Norwich.
Self-evidently, a building should be sufficiently safe for not just residents and occupiers but visitors, tenants and everybody else. We have all seen the consequences when things go wrong. When I was a member of the fire service pension scheme, we had a meeting on the morning of the Grenfell fire in the headquarters of the London Fire Brigade. None of us really knew the gravity of what was unfurling before us; those horrors came later. The noble Baroness, Lady Taylor, has given us the chronology, so I will not detain the Committee with it.
I have no wish to criticise the regulator or anybody who works within it. They have had to get going under the glare of publicity. There was the move from the HSE to Marsham Street; the regulations had to be revised; delays were inevitable and staffing changed. Let us not rehearse all the difficulties. Our challenge is to look forward and get these issues fixed in a proportionate manner so that we can get Britain building again.
Back in about 2019, I sat in the office of the then Secretary of State when the Building Safety Act 2022 was being mooted. He made a powerful observation that stuck with me: some felt that the Act, if implemented, could in some way prevent fire. That misdirection by some was a delusion, because fires will happen. The first purpose of the Building Safety Act should be to enable people to get out quickly. Clearly, there are ways to prevent fire, slow its spread, compartmentalise and raise the alarm in the event of a conflagration. Nobody wants to see a building burn, but too often the regulations that have flowed from the Act have placed too great a focus on the purist approach to preserving a building’s fabric rather than saving lives. We must restate the balance between protecting the building and getting people out more quickly.
The regulations have spawned a huge amount of work. Approaches have inevitably created a bureaucratic monster, especially for older buildings. I think it is fair to say that, historically, there have been unrealistic assessments of risk—blind to cost and burdened by process delays—which have stymied desirable works while making homes worthless in the meantime. Counterintuitively, in some cases they have reduced safety, with refurbishments abandoned, increased risks to residents and the open-ended costs of waking watches and unsellable homes. Success was never meant to be like this.
Obviously we need to focus on the highest-risk buildings—those that are hardest to get out of—but this bureaucratic mission creep has blighted otherwise safe buildings. The fault is not necessarily with the regulator, the builders, the landlords or whoever is directly involved with a premises. Other actors have contributed to the misdirection that has blighted buildings and stalled lives. The mission creep has led to many cases of 11-metre buildings, for example, which are much safer and easier to get out of—and in which, if fires occur, they are much easier to fight—being needlessly tainted. A practical example of this misdirection sees uninformed conveyancers, egged on by mortgage providers, estate agents, valuation surveyors and insurers, demanding unnecessary EWS1 inspections at a specimen cost of £25,000 each, because inevitably intrusive investigations—with scaffolding and making good—will be required. Legally unnecessary, these EWS1s then need to be repeated every five years. It is pointless and counterproductive, and diverts from the risks of addressing the needs of the really high-rise, high-risk buildings.
I am not making the case to ignore unsafe buildings, but excessive delays over specification and costs are keeping people in unimproved buildings that could be made safe for longer, so that they cannot move; it takes too long to buy a home and sales fall through. Housebuilding itself has collapsed in London and, because what happens in London—where there is a disproportionate number of high-rise buildings—follows elsewhere, we are just gumming up the national market. That is why it is important to get this right and to get a grip, not least because we will see perverse consequences if we make it all too difficult for freeholders to do the right thing, especially if the regulatory costs exceed the costs of doing the work. They will just collapse their firms, leaving the leaseholders—those least likely and able to afford it—holding the baby.
Molior reports that new starts in London developments have fallen from a peak of 33,774 in 2015 to just 5,547 in the first quarter of 2026. Getting this wrong in a city that houses 10 million people is never going to grow the economy at the rate we need to.
How do we improve? I am grateful to Berkeley Homes for telling me that, within the regulator, we need to streamline the move from gateway 2 to gateway 3 as an application moves from idea to reality, and we need case officers to be passported through on the same application. Sometimes—we have heard the reasons why—case officers change, with their different views, interpretations or prejudices, which adds to delays, risks and costs. It would be helpful if we fixed the reinvention of the wheel, where lessons learned from one application cannot be passported to another similar development of a common design.
We should celebrate innovation, but we must turn against the notion that anything new is intrinsically high risk and is tipped into the lottery of the bucket of most complex cases. Such Ludditism will never get roofs over our heads. We need to recognise that the building levy, which is £90 per square metre in Fulham, is killing building for little purpose save to sustain the bureaucracy. It is not entirely clear how, in the case of Fulham, which is a high-value area, that figure was calculated in the first place. Elsewhere, the surveyors, mortgage providers, conveyancers and the rest need to stop demanding legally unnecessary tickets with impossible burdens of proof that are collapsing sales and trapping people in their own homes.
It would be churlish if we did not recognise the enormous strides that have been taken with the move from the Health and Safety Executive to Marsham Street, but we need to recognise that we have to get better—from the 22 weeks we have heard about down to the 12-week deadline, and so forth. I am grateful that the noble Lord, Lord Roe, explained that, in order to increase confidence, which is really important, regular data releases are needed to show progress. It is important to show that trajectory; it will get developers off the pot and starting building, which will in turn get the economy moving. Something as simple as that is so welcome.
My main point is to restate the purpose of the regulator and the regulations, which is to ensure that, if a fire happens, we get people out quickly. Creating a counsel of perfection, where every single minor detail is fettled to the nth degree regardless of cost, is not helping either the system for new builds or, more particularly, older buildings that are crying out for refurbishment. Unless we get this balance right, especially in our capital city, we will not build new homes and people will not be able to get on with their lives.
Baroness Warwick of Undercliffe (Lab)
My Lords, I congratulate my noble friend Lady Taylor of Bolton on her comprehensive and forensic introduction to this report. I wanted to speak in this debate because the role of the regulator is crucial in delivering the Government’s aim of urgently building more homes and in resolving one of the most intractable social problems that the country faces: the lack of safe, healthy, affordable homes for everyone.
Of course, it is not just new homes that we should be concerned about. The Grenfell Tower tragedy put into stark relief the problems we face with existing stock. It is worth reminding ourselves that most housing stock is already ageing. Indeed, the majority of our homes are already more than 60 years old. It is a problem that has exercised all parties when in government. The previous Government set up the BSR following the Grenfell fire to improve the regulation of building safety standards. Grenfell Tower was built 50 years ago, and it was its refurbishment, and the materials and products used, that came under close scrutiny.
The Select Committee’s report is a timely review of whether the BSR has delivered on its intentions. Its findings make for sombre reading; it was very helpful to hear about the salutary other side of the argument, if you like, in my noble friend Lord Roe’s much more upbeat report on the progress made so far. The committee found that the BSR took far too long to make decisions on construction projects; that is still a problem, I think. There were also issues around staffing and skills, poor communication, a lack of high standards in some parts of the building industry and inefficient BSR processes.
My emphasis is on social homes, the majority of which are built by housing associations. The Select Committee heard from housing associations about how the BSR’s delays and a lack of clarity and communication are holding up vital safety work. I know that housing associations have been keenly focused on the safety of their residents and are doing everything they can to meet the deadlines in the Joint Plan to Accelerate Remediation of Social Housing, so it has been very frustrating that the BSR’s regulatory framework is having such a direct impact on enabling safer homes and on the delivery of new homes. The Government’s own data shows that the social housing sector has been completing works at around twice the rate of the private sector, so it is vital that these delays are resolved. I want to add here, though, that the collaborative approach from government—as well as the engagement work of the National Housing Federation to ensure that housing associations were able to feed into the joint plan’s development in order to secure agreed timelines—is an excellent example of the strong partnerships that we need to make buildings safe.
The report makes some powerful recommendations to resolve these issues. Its recommendations were welcomed by the Government, who have already put in train changes that have produced clear improvements in the BSR’s performance; my noble friend Lord Roe echoed that. There is no doubt that recent progress has been made. Since my noble friend Lord Roe and Charlie Pugsley took over the leadership of the regulator, implementing new innovation units for both types of applications and recruiting more staff to review cases, there have been significant improvements in decision-making times. These welcome changes will ensure that housing associations can remediate and build at a faster pace, securing safer homes and the new social and affordable homes that we desperately need. Even more progress will be made following the publication of the guidance for applicants on good submissions to the regulator, which should give further clarity and reduce rejections. I hope that the Minister will be able to provide some detail on when this will be published.
Collaboration between the BSR and housing associations is only growing stronger through these new initiatives. I know that the social housing sector is committed to continuing to work with the regulator on not only delivering remediation but resolving other safety risks, including transfer slabs and large-panel system buildings, to ensure that every single one of their residents feels safe in their own home.
I welcome this report. It is vital that we have a robust and proportional regulator to ensure that everyone in the country lives in a safe home. The report sets out very clear and practical recommendations on how to achieve this. The Government have welcomed them and have already taken action to improve the performance of the BSR. I hope that, in her response, the Minister can give us greater detail on any further initiatives that may follow.
There are two areas about which I remain concerned. One is leaseholders in high-rise buildings—the noble Baroness, Lady Harding, referred to this in her remarks—in terms of the remediation of dangerous cladding and other safety issues, in addition to financial uncertainty. All of these issues are compounded by the fact that leaseholders are already facing significant regulatory costs to examine and resolve safety issues for which they bear little or no responsibility. In his role as chair, my noble friend Lord Roe again gave us a much more reassuring picture, but I hope that the Minister will be able to give us an update on where precisely we are on high-rise buildings.
As I said earlier, one of the main causes of the Grenfell fire was its cladding, which is of course a building product. The committee questioned the BSR about the product testing regime and the fact that enforcement of the regulations has been almost non-existent. The noble Lord, Lord Best, also made this point. That was a very low bar indeed for the BSR to improve on. In reading the evidence, I was concerned that the BSR seemed to rely on a “nudge” approach, which it hoped would raise awareness and “ripple out”. I did not find that very convincing, and the level of enforcement action that is taking place was not clear from the report. I hope that the Minister can tell us what progress has been made in developing a rather more rigorous approach.
Lord John of Southwark (Lab)
My Lords, I declare my interest as chair of H4Life and as a partner in Quoin Partners, which represents the building development industry. I very much welcome this report; it is really an excellent piece of work. I also welcome the Government’s initial response to the report. I welcome, too, the work that my noble friend Lord Roe has done since he took up his role as chair of the Building Safety Regulator. He has clearly had a significant impact in that new position.
I do not have the knowledge that some have, having not followed this report all the way through the committee, but I wanted to talk a little about my own journey to the Building Safety Regulator, which started on 3 July 2009, when six people died in a fire at Lakanal House in Camberwell. I was the leader of the opposition group in Southwark at that time. It was a dreadful evening, and a dreadful period in Southwark’s history. Lakanal was a 14-story council-owned block, which had recently undergone major repairs. What happened at Lakanal was that a fire broke out in a television set and spread through the exterior cladding panels. It also went through voids that should have been protecting residents in the block, but which had been compromised during recent works, with holes being drilled and new pipes being inserted. The stay-put policy of the London Fire Brigade at that time, which was followed that night in Lakanal, was found to be wanting, because people were not safe—they did not have the 45-minute or hour-long protection that they should have had in their homes on that night. It is appalling to think of the six residents who died because they stayed put in their flats.
That was an incident that scarred Southwark. The 2013 inquest made recommendations. The coroner sent a rule 43 letter to the Secretary of State, the noble Lord, Lord Pickles, as he now is. But while Southwark embarked on a significant number of fire safety works, spending £70 million on our blocks in the aftermath of Lakanal, that was not the story nationwide. What breaks my heart is that some of the lessons from Lakanal were clearly not learned by the time of Grenfell. If lessons had been learned about exterior cladding, the compromising of the integrity of the building by those works and about the stay-put policy, about which my noble friend Lord Roe, has spoken so eloquently in the past, maybe the result would have been different.
However, with such a severe loss of life, the reaction from government and society to the Grenfell Tower fire was significant, unlike with Lakanal. We have talked about Dame Judith Hackitt’s inquiry from May 2018, which made so many important recommendations and brought about the introduction of the Building Safety Regulator. I remember going to a presentation that Dame Judith gave about the impact of her report and thinking that it would have quite an impact on the skyline of London if it was followed through. Suddenly, we were talking about having a different regime for buildings of 18 metres and below and for those above that height. I do not think that that was a point that the industry necessarily picked up on at that time, in 2018 and 2019; it did not recognise that this was going to mean a very different approach.
On my next contact with the Building Safety Regulator, I was particularly impressed by the contribution of the noble Baroness, Lady Harding; she perfectly captured the problems that we saw with the creation of that regulator. I saw that, alarmingly, during a presentation at the Local Government Association conference in July 2023. This was before the Building Safety Regulator had done a thing—it was being created. I went along and heard some description, and I suppose we knew that these descriptions were going to come about post Hackitt, but they started talking about “higher risk buildings” in new-build terms. Who wants to go and live in a higher risk building? I thought, “This is going to have an impact”, and indeed some of the terminology we have used has had an impact on people’s desire to live in new builds that are described as high risk, which has had a knock on effect on the mortgage market.
The most alarming thing in that presentation at the LGA conference was representatives from the Building Safety Regulator saying, “Well, we’ve got a target of 13 weeks”—I thought it was 13 weeks but actually it might be 12—“but I can tell you now that we’re not going to meet it”. I thought, “This is odd. How can you be a regulator that hasn’t even started work yet but you’re telling the world that you’re not going to meet the targets that you have set?” The only interpretation that I could put on it was that if they were saying they were not going to meet 13 weeks then it was going to be 26 weeks or even longer, and that is how reality has played out. That comes about from the points that my noble friend Lady Taylor and the noble Baroness, Lady Harding, talked about: not properly resourcing the Building Safety Regulator at the start set it up to fail. As the noble Baroness said, that is a lesson that must be learned and taken away from this experience.
I would say that no builder or developer I have ever met wants to build an unsafe building; I think we can accept that. They want to be cost effective but they do not want to build an unsafe building. However, with the BSR we have created an overly bureaucratic regime. It is costly and has been time consuming. I have talked about the anticipated missed deadlines; they have come true, and we know that it has taken a year, if not longer, for some applications to pass through the BSR process.
There have also been some incredibly perverse results. I learned about a building of 100 new apartments in London that was complete and which waited for at least a year to be signed off by the Building Safety Regulator. Even though people had paid for the apartments because they were now complete, they had not been signed off so they could not be occupied. This is a crazy dystopian world that we have entered, where the BSR is, essentially preventing people from moving into completed buildings.
As everyone has observed, the BSR has contributed to a significant reduction in house building in London at a time when we need to be building more, not less. Someone said we need to ensure that it is not complex and confusing. I think the BSR is complex and confusing in the way that it operates at the moment.
I welcome what my noble friend Lord Roe has talked about today. I hear what he says about speed, and it will help the industry if the BSR regularly publishes its performance tables, because that will begin to send out a message about the regulator’s effectiveness. However, consistency is as important, and there is a massive complaint at the moment that I hear about consistency of decision-making. The point has been made already: if you have one building that goes through the BSR process and an identical building is then proposed next door or nearby, that one still has to go through the entire process. There does not seem to be any way of short-circuiting that, although maybe my noble friend will correct me afterwards. Surely, if one building has been signed off for safety, something that is identical could also be. Then there is the issue of fire doors that are accepted as safe by one part of the BSR but not accepted as safe by another, so a stand-off takes place between the developer and the BSR about whether those fire doors are safe or not. Consistency seems to me to be hugely important in how the BSR performs.
I want to talk about how I became interested in this issue and the lessons from Lakanal House. We need to achieve something speedy, effective and consistent from the Building Safety Regulator, so I ask the Minister for her observations on how we can ensure that it is delivering that speed, effectiveness and consistency. I would hugely welcome her comments on that.
We know that the performance of the BSR has had an adverse impact on the building industry. I have talked about the impact of people being afraid to get involved in higher-risk buildings. It has undoubtedly had an impact, because of the uncertainty of timing, on investment into London: investors cannot just put money forward without knowing when a building might be signed off; they need to know that there is a realistic prospect of deadlines being met. I take heart from what the noble Lord, Lord Roe, said, but there are still issues to be addressed.
There are undoubtedly some things about the state of the building industry in London and across the country that are outside our control, such as world events and other financial considerations, but the performance of the Building Safety Regulator is within our control. It is certainly within the control of the noble Lord, Lord Roe, more than it is of most of us. This is something on which we should bear down so that, as others have talked about, we can give confidence to the industry and to housebuilders to get the new homes built that we so desperately need.
Lord Jamieson (Con)
My Lords, I declare my interest as a councillor in central Bedfordshire. It is a delight to follow so many excellent speakers, such as not only the noble Lord, Lord Roe, but the noble Lord, Lord John, given his experience of Southwark. I also give my thanks to the committee and to the noble Baroness, Lady Taylor of Bolton, for their excellent work and this very helpful and useful report before us.
This is a subject of real importance; it goes to the heart of two of the most pressing challenges that we face: ensuring that buildings are safe for those who live in them and ensuring that we can actually build the buildings that we need for our communities and people. There was a very interesting comment from the noble Lord, Lord Roe, that one of his big concerns is not just the safety of buildings but having safe buildings available for fire staff in London.
The establishment of the Building Safety Regulator was one of the most significant reforms introduced under the Building Safety Act 2022, by the previous Conservative Government, in response to the Grenfell Tower tragedy. That Act was necessary and it was a serious attempt to restore confidence in the system of building control to strengthen accountability across the construction sector and to ensure that the failures that led to Grenfell could never be repeated.
We should be clear about why reform was needed: the Grenfell Tower fire, now almost nine years ago, led to the loss of 72 lives. Beneath that was the exposure of profound, long-standing failures in regulation, oversight and professional competence, as others have mentioned. That subsequent inquiry identified that the regulatory system had not kept pace with risk, a culture in parts of the industry where fire safety was not given sufficient weight and deeply concerning misconduct by some manufacturers of construction products.
In that context, the direction of travel set by the Building Safety Act was right: stronger regulation of higher-risk buildings, clearer responsibilities and a more robust system of oversight were all necessary reforms. However, as the committee’s report makes clear, the effectiveness of the system now depends on its operation in practice. It is one thing to design a regulatory framework; it is an entirely different thing to make sure that it operates well in practice. As the committee suggests, in its early operation, the Building Safety Regulator faced a number of challenges in its performance. I am delighted to hear in the update from the noble Lord, Lord Roe of West Wickham, that its performance is improving substantially and that a number of the recommendations that are in the report are, in effect, being taken forward and acted upon, but there is more to do. I will concentrate on some of that, but I recognise that the regulator is part of the way along that journey.
Importantly, there have been delays in decision-making, uncertainty among applicants about what information is required at different stages, inconsistent communication, and a shortage of suitably qualified inspectors and fire safety professionals. Building safety is a shared responsibility: a regulator cannot succeed without a competent and responsive industry and, equally, the industry cannot succeed without a regulator that is clear, proportionate and efficient in its decision-making. I am pleased that other noble Lords have mentioned the importance of culture and of working with the industry and not being entirely separate.
As leader of Central Bedfordshire, I saw directly the challenges of delivering housing, regeneration and infrastructure within an increasingly complex regulatory environment. Local authorities sit at the intersection of these systems. We work with the developers, housing associations, utilities and regulators. What matters most in practice is not simply the existence of regulation but that it is clear, predictable and capable of being navigated without unnecessary delay. Where that clarity exists, delivery can proceed at pace. Where it does not, even well-intentioned policy can become a barrier to progress.
If we are to build the homes this country needs, we cannot look at building safety regulation in isolation. We must consider how it interacts with practical realities. How can we ensure those high standards ensure the use of safe materials but deliver decisions in a timely and predictable way? I do not think many noble Lords mentioned risk in terms of development. If you ask developers, the things that they are interested in are speed, certainty of decision-making and risk. This is a particular issue in places such as London, where you have huge upfront costs—buying the land, the development process and so forth. If you are building a large block of flats, you cannot sell them until you have completed the whole building. For those of us in rural areas, if you have 10 acres and are building detached houses, you can build them a house at a time and your upfront costs are so much less. Ensuring that you have a safe process is absolutely the first thing, but how can we also give people certainty that they will get through the process and know what the requirements are? That is how we will be able to get more buildings done.
The figures in the report illustrate the scale of the issues. The target is 12 weeks. In May this year, it was 35 weeks. I am really impressed that it is now 22 weeks, which is an improvement. We acknowledge that, but there is more progress to be done in the process. Delays inevitably have consequences, not just for new buildings but in existing buildings where remediation needs to happen. It means leaseholders remain in buildings with unresolved safety issues for longer than they need to. Remediation schemes are extended. Development pipelines are slowed and councils, particularly those engaged in regeneration, face uncertainty that can affect viability, funding and sequencing.
The committee is also right to highlight skills. It seems that everything in the development world revolves around a shortage of skills—whether of planners, plasterers, brickies or electricians. This is a critical area of safety, and I am really pleased that the Building Safety Regulator has been able to get more people with the skills they need. The one question I will ask is about an experience we have had with planners. When there is a downturn for developers—clearly, they are not bringing forward as many projects as they have in the past; their demand has gone down—we find that there are more people available on the regulator and planning side. I would like an assurance from the Minister that we recognise the need for a skills pipeline but are not overoptimistic, as we could be in a situation where, because of a slowdown in the number of developers bringing forward projects, the demand on their side is reduced and availability for the regulator is increased. I think that is something we need to look at.
One particularly important recommendation that the noble Baroness, Lady Taylor of Bolton, brought forward was around the well-judged balance in determining what needs to be approved and when. That is very important for looking at category A and category B and the timing. Getting everything done up front is great, but when you are dealing with something with very high costs involved, if you are able in a safe way—as the committee suggests—to do it over a period of time and bring forward things at the appropriate time rather than up front, that has significant benefits. Equally, as we have been saying, with category A and category B works, it is about ensuring that you have the right specialist expertise operating on the most demanding aspects and the appropriate levels at some of the other maybe less demanding categories, such as category B.
We have talked about clarity of communication. I would also mention—I am very pleased that the noble Lord, Lord Roe, raised this—that building safety is not a static discipline. As the noble Lords, Lord Roe and Lord Best, said, we need to ensure that there are safe materials and that they are tested suitably. That is not necessarily within the remit of the Building Safety Regulator at the moment but, as we get a better understanding of what safe materials and safe design are and how fire operates in a building, with that greater knowledge and experience, the Building Safety Regulator should look at how regulation can evolve to ensure that we enhance building safety and have a responsive regulator. I am very keen that those lessons are brought forward and that we can evolve our approach to regulation to ensure that we improve our safety.
In conclusion, we are dealing with two parallel national priorities: the remediation of unsafe buildings in the wake of Grenfell and the need to increase housing supply across the country and to ensure that buildings are safe. These priorities should not be in conflict and they do not need to be. A system that restores confidence in building safety will support investment and delivery, but a system that is slow and unpredictable risks undermining both. That is why the report is so important. It does not question the principle of strong regulation or seek to dilute the lessons of Grenfell; rather, it focuses on how we can ensure that the system introduced by the Building Safety Act 2022 works as effectively as Parliament intended and as is needed. I hope the Government will give the committee’s recommendations careful consideration. They are practical, measured and focused on improving outcomes, rather than on the process for its own sake. I commend the report to the Committee.
The Parliamentary Under-Secretary of State, Ministry of Housing, Communities and Local Government (Baroness Taylor of Stevenage) (Lab)
My Lords, I am very grateful to my noble friend Lady Taylor of Bolton, not just for forwarding my mail when we get sent each other’s mail but for securing such an important debate and for what my noble friend Lady Warwick described as a comprehensive and forensic introduction. I am also grateful to the members of the Industry and Regulators Committee. This is a detailed and thoughtful report on the performance of the Building Safety Regulator. I add my thanks to my noble friend Lord Roe, to Charlie Pugsley and the team at the Building Safety Regulator and to Mark Reynolds and the Construction Leadership Council. All have played a fundamental part in moving this issue forward significantly, partly as the committee was doing its work but also since the report was published.
I recognise much of what has been said today. I thank all noble Lords for their constructive contributions, as well as their recognition that progress is being made now. Of course, the 72 victims of Grenfell and the survivors sit at the heart of this issue. My noble friend Lord John rightly reminded us of the fire at Lakanal House in Southwark, where six people were killed and 20 were injured. We must always keep the lessons learned from those dreadful incidents, as well as how to take this issue forward in future, right at the heart of the issue.
The committee’s inquiry forms an important part of Parliament’s wider scrutiny of regulators. Its report is a timely and valuable assessment of whether the Building Safety Regulator has the capacity, the capability and the right approach needed to deliver the statutory functions effectively; as the noble Lord, Lord Jamieson, said, they were set out in the Building Safety Act. It has rightly examined how the regulator is operating in practice, how it is responding to early challenges and how it can continue to build confidence as the new regime matures. Since its establishment under the Building Safety Act, the BSR has been central to delivering post-Grenfell reforms and to restoring confidence in the safety of our built environment. There cannot be anything more distressing than not feeling that you are safe in your own home. At the heart of this work are the residents themselves, who rightly expect a regulatory regime that is rigorous in its standards but also clear, proportionate and effective in how it operates in practice. As my noble friend Lady Taylor and the noble Baroness, Lady Harding, reminded us, this has also been a handbrake on the development that we need in this country.
Taken together, these points underline the scale of the task that the regulator was asked to take on and the importance of ensuring that it is properly supported to mature, adapt and improve over time. I am grateful to my noble friend Lord Roe for giving such a valuable insight into the role of the regulator, the situation as it was and the data emerging as improvement is made. This is vital in order to build public confidence and that of the industry.
The regulator now operates as a stand-alone organisation sponsored by the department, marking an important step towards reducing the fragmentation that was identified in the system in both the Hackitt review and the Grenfell reports. That has given the BSR, as a new organisation, greater operational flexibility and clearer accountability, while allowing it to focus on its core regulatory functions.
My noble friend Lady Taylor reminds us that public trust in the regime depends not just on its intent but on how clearly, consistently and efficiently it operates on the ground. That is why the department and the Building Safety Regulator have worked closely together to implement a substantial programme of operational reforms. I accept that the reforms took longer than anticipated to get going, but they are beginning now to deliver tangible improvements. Over the past 12 weeks, close to 10,000 homes have been approved, including more than 2,000 in London. Performance has improved markedly, with new-build approval rates rising to 90%, up from 33% in February. In April, the BSR also introduced an external remediation improvement plan, supported by updated guidance for existing higher-risk buildings, to accelerate the pace of remediation. Approval rates for remediation cases—I think my noble friend Lord Roe quoted this—rose to 79% in May, exceeding the 65% target.
It is also important to consider how improvements in regulatory performance sit alongside our wider objectives on housing delivery. Building safety and growth are not competing objectives; they are two sides of the same coin. Proportionate and effective regulation is essential both to ensuring that homes are built and remediated safely and to supporting housing delivery by reducing the risk of people remaining in unsafe ageing buildings or in temporary accommodation.
Against that backdrop, the Government welcome the committee’s recommendation and the challenge that it has provided in this area. We published our formal response in February this year, and we remain committed to continuing to improve the operation of the Building Safety Regulator. That includes listening carefully to feedback from residents, industry stakeholders, developers and Members of this House to ensure that the regime continues to evolve in a way that delivers safety, confidence and homes that people can trust.
I turn to some of the specific issues raised today, and I will set out how the Government are responding to some of those issues. My noble friend Lady Taylor and other noble Lords raised issues around the gateway 2 delays that we saw back in the day. As the committee highlighted, timely decision-making is critical, which is why we have focused on improving throughput at gateway 2. My noble friend is quite right: clarity of expectation for the industry is vital. The legacy gateway 2 new-build backlog has now been cleared, down from 103 cases in September 2025. New-build applications are being approved within 22 weeks on average by the innovation unit, compared with 37 weeks in July 2025. As set out by my noble friend Lord Roe, that balance is being achieved by working with developers.
Early expectations on BSR approval timelines were set before operational capacity and system maturity were fully established. It is key to say that things have moved on since then, and the BSR strategic plan now sets a clear and deliverable trajectory towards 18-week determinations. The focus now is on embedding these improvements so that stronger performance at gateway 2 is sustained. The noble Lord, Lord Jamieson, mentioned risk in development. He is right that we must try to get through the process of assessing and dealing with risk as quickly as possible.
The noble Lord, Lord Fuller, also mentioned gateway 3 approvals. Gateway 3 is still relatively new and only a small number of projects have reached that stage, but it is a critical final check before the occupation of higher-risk buildings. The Building Safety Regulator is ensuring that regulatory scrutiny is front-loaded at gateway 2, but the learning is helping developers and the Building Safety Regulator refine the gateway 3 process, improving consistency and efficiency while maintaining a firm focus on resident safety. The peril here is that I am looking at the chair of the Building Safety Regulator to make sure of what I am saying. He is nodding.
A number of noble Lords mentioned the review of the higher-risk regime, including the noble Baroness, Lady Taylor, and the noble Lords, Lord Fuller and Lord John. We have acted on the committee’s recommendation to review the higher risk building control regime to make sure that it is proportionate for lower risk and routine works. We consulted on how building work to existing buildings should be categorised under the higher-risk regime, ensuring that the information submitted to the regulator is proportionate to the scale and nature of the work while maintaining safety standards. That included proposals to reduce documentation requirements for building work within individual flats and for small-scale works in communal areas of existing higher-risk buildings. The consultation has now closed and we are carefully considering its responses. I hope it will enable a more proportionate response.
A number of noble Lords, including the noble Baronesses, Lady Taylor and Lady Warwick, and the noble Lord, Lord Jamieson, referred to the building professions, trades and occupations. Having the skills to do this work is vital. To support this, on 26 March the Government announced a £70 million investment to address shortages in building inspectors and fire engineers—the largest investment in these vital safety professions for generations. This sits alongside the wider construction skills package, to which the Government committed £625 million to improve training quality and to recruit an additional 60,000 skilled construction workers by 2028. We are committed to working with the sector to publish a new long-term strategy for building professions, which will carry out a system-wide review of regulation competence and culture, including the creation of a new central oversight function. On 20 May, we launched a call for evidence on this. I encourage all those interested to respond by the deadline of 12 August.
I was pleased to hear the noble Lord, Lord Roe, talk about the engagement that has taken place with the industry, because I know this came out clearly in the committee’s report. The noble Baroness, Lady Taylor, spoke about the quality of applications, and the noble Baroness, Lady Harding, and the noble Lord, Lord Jamieson, referred to this. We have worked very closely with industry, including through the Construction Leadership Council, to improve the quality of applications and strengthen that two-way engagement. As noble Lords have rightly said, this is a two-way process. Alongside this, the BSR has published a comprehensive suite of guidance, both directly and with industry partners, covering building control approvals, application requirements and key stages such as completion. This has been supported by wider resources including webinars and practical materials to help duty holders understand and meet their obligations. We think this is now driving significant improvement in the quality of remediation and new-build applications.
The noble Baroness, Lady Taylor, spoke powerfully about the phasing of decision-making around less high-risk buildings and the noble Lord, Lord John, spoke about consistency in decision-making. The BSR is now taking a more structured and consistent approach to decision-making, including through that clearer guidance, stronger quality assurance and greater engagement with industry. This is improving the predictability of gateway decisions, which will be critical, and maintaining a robust and proportionate safety regime with a shared expectation that applications will meet the required standard.
On reporting transparency, the noble Baronesses, Lady Harding and Lady Taylor, raised issues about the BSR reaching its KPIs. The noble Lord, Lord John, referred to the BSR saying that it felt that it could not comply, in the early days. I hope we have moved on from that now.
Transparency and regular reporting are critical so that Parliament and the industry can track performance and understand how the regime is operating in practice. For this reason, as the noble Lord, Lord Roe, said, the Building Safety Regulator now publishes monthly data on building control approval applications, covering both new-build and remediation activity. That regular publication helps provide visibility of volumes, progress and trends, and supports scrutiny of improvements over time. The Building Safety Regulator is under a statutory duty to publish a strategic plan setting out its priorities, and, as a new arm’s-length body, it will also publish an annual report and accounts to provide transparent reporting on its performance.
A number of key issues were raised around construction products—an issue about which I personally feel extremely strongly. The noble Baroness, Lady Taylor of Bolton, and the noble Lords, Lord Best and Lord Jamieson, all raised this issue. The committee was clear that long-standing weaknesses in the construction products regime must be addressed to close the regulatory gaps and restore confidence that the products we see on the market are safe. For that reason, we published a construction products White Paper in February this year, outlining proposals for ambitious, system-wide reform of the construction products regulatory regime.
The systemic dishonesty in continuing to market the dangerous products we all know about now, when their failings were well known throughout the industry, was disgraceful. Confidence must now be restored. That cannot wait any longer; we have to tackle this product-related harm. The White Paper delivers: a path to implementing a new general safety requirement to bring unregulated products into scope more quickly; a step change in product information, testing standards, certification oversight and digitisation so that those installing and using products can rely on clear and trustworthy information; a coherent regulatory framework; and a system that incentivises safety while supporting innovation, enabling the industry to grow with confidence. The White Paper and general safety requirement consultations have now closed, and our reform proposals will help build renewed confidence and trust in the construction product sector for residents—and the industry, because working with unsafe products affects not just residents but the people who work in the industry.
The noble Lords, Lord Fuller and Lord Best, raised issues around under 11-metre buildings. Buildings that have fewer than five storeys or are below 11 metres are not within scope of the leaseholder protections introduced by the Building Safety Act, but we recognise the concerns raised by leaseholders who fall outside these protections. The Government are actively considering how we can go further to support those affected. In line with the remediation acceleration plan, we are committed to providing targeted funding in limited circumstances through a small fund for the remediation of cladding in buildings under 11 metres. Further details of the scheme design and how it will operate will be set out in July ahead of the Summer Recess.
I welcome the comments from the noble Lady, Baroness Taylor of Bolton, and others about the steps that have already been taken towards the single construction regulator. In December, we published the prospectus and the consultation. We are now analysing the responses to that consultation and will publish a response this summer. The Building Safety Regulator’s functions will form a key foundation of a single construction regulator, with changes carefully phased to avoid disruption. Primary legislation is required to implement several proposals; we will bring forward that necessary legislation as soon as parliamentary time allows.
The noble Baroness, Lady Harding, rightly raised the issue of the regulator’s costs. Detailed costs will be set out in due course as we finalise the design and funding model for the regulator. Our priority will be to ensure that it has the resources to be effective while keeping costs proportionate. The noble Baroness also raised the issue of a review of the new regulator to make sure that we do not end up with something that is not working being allowed to carry on. We are considering the responses to the consultation. We expect the regulator to be introduced on a phased basis, but I assure the Committee that we are aware of the need for an early assessment of how it is working; that will be put in place.
A number of noble Lords mentioned the pace of remediation and the delays in implementation. The noble Baroness, Lady Warwick, rightly raised the issues around how this is taking effect in the social housing sector. Back in December 2024, we launched our remediation acceleration plan, and, in July 2025, we set out further steps, including the intention to bring forward primary legislation and more than £1 billion in new investment to speed up the remediation of social housing, giving social landlords equal access to government funding schemes with immediate effect. We are working with the BSR to establish a new remediation enforcement unit focused on buildings with unsafe cladding that are 18 metres and above. The noble Baronesses, Lady Harding and Lady Warwick, reminded us of the impact on leaseholders, which is certainly part of the Government’s considerations.
Since April 2024, we have also invested £39 million to strengthen regulatory capacity across local authorities, fire and rescue services and metro mayors, supporting the Building Safety Regulator to hold those responsible for remediation to account. Nearly nine years on from Grenfell, there is no justification for any building to remain unsafe. We will shortly bring forward the remediation of unsafe cladding Bill, which will drive forward cladding remediation and ensure that those responsible for the cladding safety crisis pay towards fixing the problem they caused. We will introduce a new legal duty to remediate, requiring those responsible to assess their buildings and promptly fix unsafe cladding, or face criminal prosecution. When they do not, a new remediation backstop will allow a third party to step in and carry out the work. Every building made safe means fewer families left waiting and real progress towards helping people move on with their lives.
The noble Lord, Lord Fuller, raised the cost of the building regime—an important issue that I will cover briefly. The committee raised concerns about the cost impacts of the building safety regime and the importance of ensuring that fees are fair, transparent and linked to improve performance. The Building Safety Regulator’s fees and charges are set in line with His Majesty’s Treasury’s Managing Public Money guidance and operate on a cost-recovery basis. Any changes to fees would need to be considered carefully, alongside wider efforts to improve system capacity, efficiency and the consistency of decision-making. Should future changes be made, the Government will take into account the committee’s recommendations as part of their wider assessment of what the options might be.
I hope that I have covered the points made by noble Lords. In conclusion, the Government remain firmly committed to a building safety regime that is both robust and proportionate and which protects residents, maintains confidence and supports the delivery of safe homes. The committee’s recommendations have provided a valuable challenge and clear focus on what matters most: safety, consistency, transparency and delivery in practice. As I have set out today, we have already taken significant steps to strengthen the operation of the higher risk regime, and we will continue to refine it where necessary to make sure that it works effectively for residents and the sector.
I am very grateful to the noble Baroness, Lady Taylor of Bolton, for securing this debate, and to all noble Lords who have contributed, and I thank the committee for its very careful and constructive work. I look forward to continuing the dialogue as we work collectively to make sure that the building safety system delivers for residents and the wider sector for the long term.
Baroness Taylor of Bolton (Lab)
My Lords, I said at the beginning that there was a wealth of experience in this Room; the speeches that we have heard this afternoon prove that. Every individual person has added their own insight into the nature of the problems that we are talking about, which has been extremely useful.
The starting point that we all had was that the idea of a Building Safety Regulator was something that everyone agreed was necessary. It was born out of those tragic circumstances that we must all have at the back of our minds, and it is a great shame that it got off to such a difficult start. In many respects, it was understandable that the pressures to emphasise, “This must never happen again” perhaps froze some people’s outlook in terms of what could be done and how it should operate. We all agreed that the initial period of the Building Safety Regulator resulted in delays, bottlenecks, a lack of transparency, and bureaucracy that was not necessary and could have been avoided, but unfortunately that is where we are.
It was a suggestion of the noble Lord, Lord Best, that we look at this issue, because of some of the delays that he had heard about. The more we looked into this, the more concerned we became. It was the intention of the committee to raise awareness of this issue, to highlight the difficulties that were being faced that were causing delays and difficulties for people who needed new housing—because, as my noble friend Lord Roe and others pointed out, not having a decent home is in itself a danger. We hoped that the establishment of the committee would highlight these issues and focus on the need for change.
I was really pleased when my noble friend Lord Roe said that the committee was actually a useful lever to drive forward the change. It was part of our intention to highlight the problems that could happen. Perhaps things happened more quickly than we anticipated, because we got the sense while we were taking evidence and coming up with ideas that we were having an impact, and that was extremely helpful.
So we are seeing some improvements that have been outlined by my noble friend Lord Roe and the Minister. Perhaps even more important than some of the technical improvements, although they are massively important—getting teams working together—are the beginnings of the cultural change that was being talked about. As the noble Baroness, Lady Harding, mentioned, you cannot legislate for cultural change, but when you have a regulator and an industry working together to try to improve things, you have the best way forward, and that is what we have been hearing about this evening.
The Minister outlined what she and her department are doing. Her approach is very much along the lines that the committee was hoping for. So I welcome what she has said on a whole range of issues.
I end by saying that we hope that the Minister will keep pressure on my noble friend Lord Roe, keep holding him to account and keep reporting back to Parliament, because that is the best way of giving us assurances about what is happening, and the best way of individuals being able to raise problems that perhaps do not come immediately to those who are at the coalface, so to speak. So I hope that the Minister will keep us posted.
There are still some outstanding issues. The Minister mentioned some of them. Consulting on the proportionate approach is very important. I noted that she did not give a specific date. Perhaps that was wise, because these things can drift from time to time. Making progress on products I think is extremely important. The noble Lord, Lord Best, said that we must all be able to trust that the materials in our buildings are safe. There is an urgency about that need and I think it is one that the Minister will have to continue to look at.
The progress towards a single construction regulator will have to be considered and people will have to be kept in touch and consulted about the best way forward, because we do not want to recreate new problems in the future.
The one issue I will mention that still concerns me is the question of skills. The Minister outlined the very significant investment that the Government are making. I wrote down the figure that she mentioned. Wanting 60,000 by 2028, we have a very deep problem in terms of skills shortages in this country. The Government’s targets are extremely ambitious. It really is a priority of the Government to concentrate on this, for everybody’s sake, not just in construction but across the board—but particularly in construction, especially when we look at the age profile of many of those involved.
I am very glad that we can see tangible improvements. I am very glad that we can see some development of cultural change. I thank everybody who has contributed to this. I assure the Minister and my noble friend Lord Roe that people will be keeping an eye on this issue and I am very pleased that everybody has been able to participate in this debate.
House of Lords
Oaths and Affirmations
Health-related Benefits Assessments
(1 day, 5 hours ago)
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Baroness Maclean of Redditch
To ask His Majesty’s Government what assessment they have made of the value of mandating that (1) all, or (2) more, health-related benefits assessments be conducted in person.
The Minister of State, Department for Work and Pensions (Baroness Sherlock) (Lab)
My Lords, face-to-face assessments are an important part of our multichannel approach. For some individuals, they are the best way for us to understand the impacts of their health condition or disability, and they can help boost public confidence in the health assessment system. This Government are committed to increasing the number of face-to-face assessments while acknowledging that remote assessments also have a role.
Baroness Maclean of Redditch (Con)
I thank the Minister for her Answer. She will know that the number of young people on health-related benefits has risen by more than 50% over the last five years and that four out of five of them are claiming for mental health or neurodiversity conditions. Yet these assessments, I understand, are largely carried out over the phone, when surely people would need to be seen face to face to assess what is wrong with them. Why is the Government’s ambition, as set out in the Timms review, to raise the assessments to 30% so low? Why not make it 100%?
Baroness Sherlock (Lab)
My Lords, I agree with the noble Baroness about the challenge that we face with the number of young people not in employment, education or training. That is why the Government commissioned the Milburn review, and why we welcome that report, and that is why we have action clearly going on in this space. The Government are committed to increasing the number of assessments. There is a range of reasons why it is taking time. The noble Baroness may not be aware that, for example, before Covid, assessments were pretty much all done face to face. They collapsed in Covid and the numbers have barely come back up since. In 2023, about a year before the general election, the previous Government signed long-term contracts, making sure that most assessors could work from home. I understand why that would be attractive—because they can be anywhere in the country—and so it is a bit of a challenge trying to get face-to-face assessments in the right parts of the country. We are working with contractors and driving up face-to-face assessments. We will do the right thing and we are attacking this problem.
Lord Palmer of Childs Hill (LD)
My Lords, can the department cope with more face-to-face assessments? How long will it take to put that into effect? Has the department come up with any other suggestions of how assessments can be made, particularly for people suffering from health issues which may make face-to-face assessments quite difficult?
Baroness Sherlock (Lab)
The noble Lord raises an important point and I am grateful to him. There have traditionally been different ways of doing assessments: some are face to face, some are on the telephone and some are video assessments. The starting point is that the health professional must look at and assess all the written evidence—from the GP and the hospital, and evidence provided by the claimant—and then make a decision. There are some cases where, clearly, face to face is right, for reasons of identity verification, wanting to get details they cannot easily get online, where there is a physical examination and so on. There are other cases where people may have a particular reasonable adjustment that they need—it may be difficult for them to get to a centre—and for them a face-to-face assessment is not appropriate. We want to maintain all those things but drive up the proportion of face-to-face assessments to get the right results for individuals and for the taxpayer.
Lord Watts (Lab)
My Lords, I want to be clear that this is a policy that was introduced by the last Government, who had no policies whatever to address the problem. It has been left to this Government to come forward with policies that will address the problem. Is that correct?
Baroness Sherlock (Lab)
That is so often correct, I have to say to my noble friend. In this case, we are in a situation where we are doing all we can to drive up face-to-face assessments. The most important question is that we get everyone into work who possibly can work. The biggest crisis of our time is in relation to young people. That is where the Secretary of State has put his focus; he has prioritised addressing the million young people we have not in employment, education or training. That is why we are investing in the youth guarantee, in support for employers, in subsidies for wages and in making sure we go out there to find the challenges and get people into work. This Government are doing something about that problem.
Baroness Finlay of Llandaff (CB)
How many long-term claimants with severe long-term disabilities, who will never have a life devoid of dependence on disability benefits, has it been agreed will not be recalled to assessment—assessments which proved to be futile and quite damaging to their whole persona as they feel they are not being believed? These are often people who have got severe brain damage or ongoing congenital abnormalities and genetic difficulties.
Baroness Sherlock (Lab)
I am grateful to the noble Baroness for raising such an important point and for her work and expertise in this area. Our job is to make sure that we assess the right people at the right time. There is always a danger when debating this that we forget the significant number of people who are absolutely dependent on sickness and disability benefits; frankly, most of them would give anything to not be dependent on those benefits and to not have had the condition, injury or accident that transformed their lives for ever.
Our job is to make sure that those who need our support get it. We have been looking at the way we review things, so that we are reviewing the right people to make sure they get the right level of award. If it gives the noble Baroness some reassurance, there will be cases where the health assessor can clearly make a judgment based on the medical evidence alone. In those cases, they will not necessarily need to see somebody face to face or call them to an assessment. Where there is any doubt, however, we need to make sure that people get the right support if they are entitled to it and give confidence to the public that we are doing those assessments in the right way.
Lord Hayward (Con)
My Lords, I was interested by the answer the Minister gave to my noble friend in relation to the signed contracts for work being undertaken virtually. Could she clarify whether there is an expiration date, or a time limit in some form or another, for these contracts in order that you can bring people back to a face-to-face arrangement quickly?
Baroness Sherlock (Lab)
These were long-term contracts and were signed only in late 2023 and took effect shortly after, but we are not simply taking that as meaning that we cannot do anything. We are in close negotiations with all the contractors to look at how we can drive up the proportion of face-to-face assessments. It will take time because, having started with so many being home-based, we have to make sure we can get the numbers back up in time. There are limited numbers and assessors have to be either a registered doctor, a nurse, an occupational therapist or a physiotherapist; they have to be trained in disability assessment medicine; and they have to engage in continuous professional development. We need to make sure they are properly qualified to make those assessments, but we are working to get the numbers up as fast as we can.
Baroness Nargund (Lab)
My Lords, I thank the Minister for reassuring us that face-to-face appointments will be increased with trained professionals. I welcome the DWP initiative to reform the fit note system. There are millions of women who are absent from work due to women’s health problems and nearly 60,000 women are leaving work every year due to menopausal symptoms. What conversations has my noble friend the Minister had to ensure workplace adjustments will be made to get these women back to work or into new employment?
Baroness Sherlock (Lab)
My noble friend raises a very important point—and one that I suspect at least maybe half of the House could empathise with in some way. I reassure my noble friend that the Government take menopause support seriously. We have been doing work specifically on this, having appointed a menopause champion, and are looking at women who are experiencing severe menopausal and perimenopausal symptoms and how that impacts their work.
This ties in with our reform of fit notes—we are piloting new ways to make the fit note system work better—and, crucially, the work we are doing with employers. We know that employers want to support their staff to keep them in work. We do not want women falling out of work unnecessarily when they hit the menopause for either lack of preparation or support on their part or from their doctors, or because employers do not understand and cannot make appropriate adjustments. I am really grateful to my noble friend for raising this.
Baroness Stedman-Scott (Con)
My Lords, between July 2024 and July 2025, 1.1 million assessments were carried out remotely. Three-quarters of those were conducted by telephone and just 3% were conducted by video link. Notwithstanding the answers the Minister has given us already, how can a DWP assessor properly judge whether someone has significant difficulty with daily living or mobility as a result of their condition when the assessment is conducted by telephone and the assessor can hear but cannot see the person concerned?
Baroness Sherlock (Lab)
I will not dwell on the point that the challenge we are facing is the challenge the previous Government faced, and we did not invent telephone assessments.
The noble Baroness raises an important point. The truth is that it depends on the case. The job of the health professional is to begin by looking at all the written evidence. As I said previously, sometimes that will mean that a case can be absolutely ruled in, or indeed ruled out, but there may be circumstances in which more information is needed. Video assessments can be effective in that, so can face-to-face assessments, but it depends on the nature of the question. There are questions that can be addressed in a telephone assessment. The same core assessment process is used across the piece to gather evidence and ask the right questions, so the health professional can justify their decision. At any point, if they need a different kind of assessment, then it is their job to request it. We want to make sure we have more face-to-face appointments available, but we want to make sure we get people into the most appropriate assessment, so we can get through assessments as fast as possible, get people who need help the right help, and get people who should not be getting help into work.
Affordable Housing: Young People
(1 day, 5 hours ago)
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Baroness Thornhill
To ask His Majesty’s Government what steps they are taking to increase the amount of affordable housing for young people.
The Parliamentary Under-Secretary of State, Ministry of Housing, Communities and Local Government (Baroness Taylor of Stevenage) (Lab)
My Lords, the Government have committed to delivering the biggest boost to social and affordable housing in a generation, and young people will benefit from this. The £39 billion social and affordable homes programme aims to deliver around 300,000 new social and affordable homes, including at least 60% for social rent. For young people renting, the Renters’ Rights Act has capped rent in advance and ended unfair bidding wars and no-fault evictions. I am also working with the sector to simplify the buying and selling process and make that more accessible.
Baroness Thornhill (LD)
I thank the Minister for her positive response, but—and it is a big but—how does the £39 billion pot actually help if, on the one hand, as charities tell us, her departmental bidding processes and rules exclude, in effect, the smaller youth charities from actually applying for grants and building vital transitional and move-on accommodation for young people, but, on the other hand, the Government’s own planning guidance lacks the strength and clarity to allow planners to give permission for what is becoming known as the stepping-stone accommodation model, to enable the building of such accommodation? Please could the Minister look into both these obstacles, currently mentioned by the charities, to ensure that these smaller providers can actually deliver the affordable homes that young people need and can afford?
Baroness Taylor of Stevenage (Lab)
I recognise the noble Baroness’s concerns, and I welcomed the opportunity to speak to her on this matter during the passage of the Planning and Infrastructure Act; I subsequently went to visit one of the schemes she had mentioned to me. The nationally described space standard sets minimum standards for internal floor space of new dwellings and is suitable for application across all tenures, but that standard is not mandatory, and it is at the discretion of local planning authorities to adopt it locally by reference to the standard in their local plan policies. As part of our consultation on updates to the National Planning Policy Framework, we have sought views on whether changes are needed to make sure that affordable fixed-term accommodation, such as stepping-stone accommodation, is better supported, with particular reference to space standards. We are in the process of analysing the responses to that and we will be confirming our response in due course.
The Lord Speaker (Lord Forsyth of Drumlean)
My Lords, the noble Lord, Lord Campbell-Savours, is taking part remotely; I invite the noble Lord to speak.
Lord Campbell-Savours (Lab) [V]
My Lords, with land plots for housing often exceeding the cost of home construction, does that factor alone not act as a real disincentive to the development of housing for sale at realistic, affordable prices? Why do we not establish a study into the relationship between land pricing and housing development costs? The study could consider proposals for building on land acquired at agricultural prices and sold under new forms of housing registration and land title arrangements, but which, at the same time, with other measures, could protect investment in existing freehold.
Baroness Taylor of Stevenage (Lab)
I thank my noble friend. We continually look at issues around the viability of building and are working very closely, with both the development sector and our local authorities, to make sure that land pricing and other issues around viability are taken into account. The £39 billion we have put into social and affordable housing will make sure that we can give some support to those who are trying desperately to get some social housing built in the country; we continue to work with them on that. The bold planning reforms we have introduced will also assist with that process.
Lord Young of Cookham (Con)
My Lords, young people are paying more in rent than they are on a mortgage, and so they would not need to join the queue for affordable housing if they had some help with a deposit. I put again to the Minister the question I posed to her in April, when she conceded that there was more work to be done. What progress has she been able to make in discussions with the developers, the financial institutions and the Treasury to bring forward a successor to the Help to Buy scheme, on which the then Government made a profit of £1.4 billion last time?
Baroness Taylor of Stevenage (Lab)
A detailed analysis has been done of the Help to Buy scheme, and we will learn lessons from it. We will not reintroduce it as it was, but I agree with the noble Lord that, for many young people renting property, their rent is higher than a mortgage payment would be. Since I gave him my previous answer, I have been working with the sector. A wide variety of mortgage products are available in the UK, including a range of products available at a high loan-to-value ratio, such as 95% and even 100%. I met the Building Societies Association last week, and it is very keen to offer more innovative products that can help first-time buyers, including some that take account of a track record of paying rent, as they deal with a mortgage application. These are innovative systems. We know that many first-time buyers are not aware of the mortgage products that may help them, so we are working on a communications campaign. The Building Societies Association is doing its own, and the Government will also do something to make people aware of the steps they can take to get on to the housing ladder.
Lord Best (CB)
My Lords, does the Minister agree that there is now a brilliant new way of helping young people get the accommodation they need: intergenerational housing? Pioneered by the Phoenix Community Housing association in Lewisham, in schemes involving apartments for older people, a proportion are allocated to young people, who, in return for an affordable rent, provide social amenities, services and help with IT for the older people in the same scheme. Will she encourage Homes England to do more of these fantastic schemes that help both young and old together?
Baroness Taylor of Stevenage (Lab)
I agree with the noble Lord that such intergenerational schemes work exceptionally well, and I thank him for sharing the information on the initiative in Lewisham. The Government have committed to delivering this biggest boost to social and affordable housing, to make sure that everyone, including younger people, have access to safe, decent and affordable homes. To achieve that ambition, we will rely on both housing associations and councils across the country delivering the kind of ambition and innovation that the noble Lord discussed. I look forward to hearing about more schemes such as Phoenix Community Housing; it is great to have generations working together on their housing.
The Lord Bishop of Manchester
My Lords, young people under 35 who require support for their housing get only the shared accommodation rate of benefits, yet they are often disproportionately the people who have mental health concerns or other issues. Does the Minister agree that this needs looking into to ensure that the most vulnerable young people are not the ones who are pushed to the bottom of the housing situation?
Baroness Taylor of Stevenage (Lab)
The allocation of funding for the DWP is a bit out of my housing remit, but I know that my noble friend who just answered the first Oral Question will have that in the forefront of her mind. As we deal with the situation around vulnerable young people, adequate housing is an absolutely fundamental building block of making sure that we set young people off on the right road from the very start. We will be working with colleagues in the DWP to make sure that we tackle the issues that prove to be barriers to young people entering housing.
Lord Jamieson (Con)
My Lords, where proceeds of right to buy are used to build a new social home, the council housing waiting list reduces and a family has the opportunity to have their own affordable social home. Does the Minister agree that the Government should support and encourage strategies that provide more homes and reduce council housing waiting lists?
Baroness Taylor of Stevenage (Lab)
It was right-to-buy policies over the last 14 years which diminished the stock of social housing. So, while I agree with the noble Lord, I do not think that the right solution was brought forward. The Social Housing Bill that is currently before the House will change the right-to-buy scheme so that we enable more of the funding for right to buy to go back into the properties. We have now allocated 100%, so that local authorities can have 100% of the funding, and we will reform the whole right-to-buy scheme to deliver a fairer, better-value and more sustainable scheme. We want a scheme that will help long-standing tenants to buy their own homes, but we also need to protect much-need social housing stock and ensure that more homes are built than lost. That is what we are doing with the Bill. We will make sure that when a local authority builds a new house, it is exempted from right to buy for 35 years, so that councils have the confidence to invest for the future.
Baroness Jones of Moulsecoomb (GP)
My Lords, speaking of innovation, Green Party-led Bristol City Council has had some success in creating housing for younger people by using ownership co-operatives and co-housing schemes. Is that something that the Government are looking into and perhaps encouraging in Labour-led councils?
Baroness Taylor of Stevenage (Lab)
There are a number of successful co-operative housing schemes across the country. The commonhold and leasehold Bill, which we will bring forward later this year, will have steps in it to ensure that we make it easier for these kinds of innovative housing approaches to take place.
Royal Mail
(1 day, 5 hours ago)
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Lord Sikka
To ask His Majesty’s Government in which years since its privatisation Royal Mail has fully met its first class and second class letter delivery targets; and what assessment they have made of its performance in this period.
The Minister of State, Department for Business and Trade and HM Treasury (Lord Stockwood) (Lab)
My Lords, Ofcom sets and monitors the Royal Mail’s quality of service targets and publishes annual performance data. Following its privatisation in 2013, Royal Mail fully met its first-class and second-class delivery targets in 2013-14, 2014-15, 2016-17 and 2019-20. Royal Mail met its second-class target, but not its first-class target, in 2015-16, 2017-18 and 2018-19. Royal Mail failed to meet both targets in all years from 2021-22 to 2025-26. The Government’s assessment is that performance has been unacceptable and must improve, and we will continue to engage with Ofcom and Royal Mail accordingly.
Lord Sikka (Lab)
My Lords, Royal Mail is another disastrous privatisation. Since privatisation, the price of a first-class letter has increased by 200% and second-class by 89%. As the Minister just said, Royal Mail has not met its delivery targets for years, and Ofcom continues to lower the targets; second-class mail is now to be delivered only every other day and not at all on Saturdays. Ofcom has clearly failed. It seems that the Government have two options: either to restructure Ofcom or to bring Royal Mail into common ownership. Which option will the Government exercise?
Lord Stockwood (Lab)
In preparation for this Question, I spoke to both the CEO of Royal Mail and directors of Ofcom. For context, it is worth stating that letter volumes have halved in the last 10 years, while the number of addresses has increased significantly. While I agree with my noble friend that performance has not been where it needs to be, there is a quality of service plan that has been negotiated between Ofcom and Royal Mail, and indeed, this year, Royal Mail is above the targets that it set for itself to meet those aggressive performance targets by March of next year. Some £500 million of additional investment has been committed, and there was an agreement with the CWU to ensure that the employment practices are sustainable for the commitments to improvements and services. So, while I agree with my noble friend that the current performance is not where it could be, the CEO of Royal Mail made commitments early last week that he is confident that it will meet the targets by April of next year.
Lord Pack (LD)
My Lords, one of the significant problems faced by Royal Mail staff in trying to reach those targets is the very large number of physical attacks by dogs on postal staff—over 2,000 incidents every year. This problem is, unfortunately, made worse by the very poor design of many letterboxes, which means that you cannot safely deliver a letter without putting your fingers at risk from an angry dog’s teeth. What work are the Government doing with the relevant interested parties to ensure that the standard of letterboxes is improved and that postal staff can do their work in safety in future?
Lord Stockwood (Lab)
I will have to refer this back to the Ofcom regulators. I had not prepared for a question on letterboxes, unfortunately, but I will write to the noble Lord giving him an update.
Lord Redwood (Con)
Is not the financial performance of Royal Mail so much better than that of the nationalised Post Office, with Royal Mail requiring no subsidy from taxpayers and the Post Office sending colossal bills for big losses and for damaging treatment of staff who require compensation?
Lord Stockwood (Lab)
These are early stages in the privatisation of Royal Mail. The new owner, EP Group, shows an encouraging commitment to improving the services and conditions of work for all employees, but it is too early to say. The Question was about performance of second-class and first-class mail, and that we can commit to. The investors are committed to an improvement programme to get us to where we need to be.
Baroness Prosser (Lab)
My Lords, I declare an interest as a former member of the board of Royal Mail. I understand people’s frustration and anger, but this is a global problem. Every developed country is suffering from a reduction in the number of pieces of mail being delivered and sent through the post while still requiring the infrastructure to deal with that smaller number and that smaller income. Do the Government have any plans to bring together Royal Mail and its foreign equivalents in other developed countries to see what answers can be found to this global problem?
Lord Stockwood (Lab)
Currently, we are focused on improving the performance of Royal Mail in the UK through Ofcom and through direct conversations with Royal Mail. My colleague, Minister McDougall, meets with his counterparts in Royal Mail and Ofcom on a regular basis. However, I take my noble friend’s question seriously. It is important that we encourage the provider to speak to its foreign counterparts to ensure that there is a solution that is met. We are currently engaging with the EU on a number of issues, but this is something that we should get to in short order as well.
Lord Kirkhope of Harrogate (Con)
My Lords, while there are delays in post being received, a considerable number of people are concerned at the amount of post that appears to be mislaid or lost or never even arrives at its destination. Has the Minister got any statistics on that which he can give us any information about?
Lord Stockwood (Lab)
There is regular analysis of overall delivery rates, including for mail that is waylaid. There are some innovative solutions within the universal service offering. For example, one of the questions that came up was about NHS letters, which are critical and must be delivered on time. There has been a technological solution involving barcodes that can ensure that those letters get prioritised when there is high demand and pressure on the service. I believe that the investor and Royal Mail are looking at innovative solutions to ensure that they meet their targets across the whole system.
Lord Woodley (Lab)
My Lords, I know from personal experience that urgent letters, particularly those associated with hospital appointments, are not getting through in time. Have the Government made any assessment of the devastating effect that this is having on healthcare in our country?
Lord Stockwood (Lab)
As I said in my previous answer, this was highlighted as an issue to the new investor. The Royal Mail has introduced a barcode system to optimise the delivery of NHS letters at times of local and national disruption, but it is beholden on all NHS bodies and providers to use this system. I ask all Members of the House to encourage their local NHS, where they interact with senior leadership, to take up this service. It is a technological solution that can prioritise those urgent and critical letters from the NHS, and this should provide certainty that the delivery will get there and not be in jeopardy.
Lord Hunt of Wirral (Con)
I will start by congratulating the Minister on the hard work he has carried out in preparing for this Question, and in particular the discussions he has been having with Royal Mail. However, does he not accept that, by increasing national insurance contributions, which I reckon adds around £120 million to the costs of one of Britain’s largest and most labour-intensive employers, the Government have made it significantly harder for Royal Mail to restore service standards, maintain the universal service obligation and invest in those improvements that customers and businesses expect?
Lord Stockwood (Lab)
I appreciate the comment on my hard work—it is now noted. I cannot agree with the noble Lord on that particular point. It is unfair to think about an individual tax application on the investment in this specific case. There is £500 million of committed capital from the new investor, EP Group, and that is a non-trivial undertaking that has been committed on an £8 billion business. At the moment, we are proud, as a Labour Government, that we are shoring up the fiscal rules and the economic prospects of this country, so that we can invest in the public services that we rightly believe we need to.
Earl Russell (LD)
My Lords, I want to ask the Minister about future access to Post Office counter services now contained in TGJones stores. What steps are the Government taking to ensure that those counters are not closed, particularly in deprived urban areas and rural areas, and are the Government considering requiring minimum coverage standards?
Lord Stockwood (Lab)
It is really important not to conflate Royal Mail delivery and the Post Office, but Ofcom is committed to the universal post offering and the targets, so I will have to write to the noble Lord on this particular question, because this was the extent of what I researched for this particular Answer.
Baroness McIntosh of Pickering (Con)
Does the noble Lord share my concern that perhaps the postal service and the Royal Mail are focusing too much on parcel delivery and not enough on a universal letters service that plays to elderly populations in rural areas? If we go fully digitalised and if we lose the postal service, it would be a very retrograde step for that group of people.
Lord Stockwood (Lab)
The noble Baroness raises a really important point about making sure the universal service offering is not to the detriment of people who are remote or not digital. Its CEO has confirmed that Royal Mail is focused on improving all aspects of its service across postage and parcels. The Government will be putting pressure on Ofcom to ensure that Royal Mail improves all its services without detriment to any particular user group.
School Admissions: Selective Inclusion
(1 day, 5 hours ago)
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Lord Watson of Invergowrie
To ask His Majesty’s Government what assessment they have made of the report by the Sutton Trust Selective Inclusion, published on 24 March, which found that the top 500 secondary schools admit a lower proportion of pupils eligible for both free school meals and special educational needs support than live in their catchment area.
The Minister of State, Department for Education and Department for Work and Pensions (Baroness Smith of Malvern) (Lab)
My Lords, as set out in our White Paper, Every Child Achieving and Thriving, all children should have access to high-performing schools. However, more could be done to reduce barriers in the system, particularly for children from disadvantaged backgrounds and children with SEND. We will ensure that all mainstream settings are welcoming to children with SEND by investing £1.6 billion over three years to support early years settings, schools and colleges to become inclusive by design. We will also develop new resources to support and encourage schools to use existing provisions within the code, such as the ability to prioritise children eligible for the pupil premium, to adopt more inclusive admission arrangements.
Lord Watson of Invergowrie (Lab)
I thank my noble friend for that response. She mentioned the existing requirements on school admissions, but as the Sutton Trust report revealed, 36% fewer pupils with SEND from disadvantaged backgrounds are accepted in the higher-performing schools. The current rules are simply not doing the job that they are intended to do. That is often a double disadvantage for these children, because the Sutton Trust figures show that it is often children with SEND eligible for free school meals, rather than SEND pupils as a whole. As we await a consultation on a new School Admissions Code, does my noble friend agree that the rules need to be strengthened if the Government are to be able to achieve their aim of more SEND pupils being educated in mainstream schools?
Baroness Smith of Malvern (Lab)
I think we need to make sure that all schools achieve the levels of inclusive education necessary to support children with special educational needs and disabilities. That is the reason for the investment we are putting in place, the emphasis we are placing on inclusion—for example, through our RISE teams across the country—and the new emphasis that Ofsted will have, when inspecting schools, on the inclusive nature of what is being offered within them.
Lord Young of Acton (Con)
My Lords, I declare an interest as a member of the Knowledge Schools Trust. In light of this Sutton Trust report, does the Minister share my misgivings about the Government’s decision to impose VAT on independent school fees? The 30,000 pupils who have now left the independent sector will be beating a path to the doors of these 500 high-performing comprehensives, which will mean even fewer places for children from disadvantaged backgrounds.
Baroness Smith of Malvern (Lab)
No, not least because, if we are to put the investment into our state schools that the 94% of children who use them need, we need to ensure that that is properly funded. On concerns about independent school closures, which I understand, I am sure noble Lords will be reassured that in 2025 more private schools opened than closed. There are 41 more independent schools in 2026 compared with 2025 and, in fact, the overall fall in private school pupil numbers reflects demographic change across the whole school system.
Lord Addington (LD)
My Lords, will the Minister enlighten us on exactly how the Government will make sure that there is an aggressive approach under this new SEN system to identify and support students and that this is reflected widely in things such as Ofsted reports? What is measured gets done, and at the moment it is quite clear that many schools are not taking that aggressive approach to make sure the right help gets to the pupils who need it.
Baroness Smith of Malvern (Lab)
I am not sure I would characterise it as an aggressive approach, but it is certainly a key element of the Government’s SEND reform that we ensure children get the right support, whether in their early years setting, their school or their college. That is why we are investing in new training for all staff, better buildings and equipment, and will make sure that every setting has access to expert professional support when it is needed. An inclusive education system for all children and young people requires a strong universal offer, built on high-quality adaptive teaching and early effective support. We will equip and empower mainstream settings to become inclusive by design and to remove commonly occurring barriers to learning. We will invest £4 billion more over the next three years to ensure that happens.
Baroness Cash (Con)
My Lords, the OECD PISA survey looks at whether the school that children attended makes a difference to their attainment. Contrary to some of the assumptions underlying the Sutton Trust report, it makes less difference which school you attend here in the UK than in many other countries; we are below average, and that is a good thing. Does the Minister therefore acknowledge that forcing every school to fit one profile risks further constraining parent choice, with very little benefit to the children?
Baroness Smith of Malvern (Lab)
I welcome the noble Baroness to her new role, and I am looking forward to working with her. The answer to ensuring that parents have the choice they want and deserve is to enable all schools to be the type of good schools that any of us who have or have had children would want our children to go to. That means ensuring that we have more teachers in our schools, which we are focused on; ensuring that all schools follow a revised national curriculum; and investing properly in them. These are all things that this Government have focused on, and we will continue to do so to ensure that every parent has the choice of a good school for their child.
Lord Isaac (Lab)
My Lords, it is excellent to hear the Minister identify that there will be more resources to reduce the barriers for children with SEND. But in the Sutton Trust report there were specific recommendations to increase the number of teaching assistants and to promote a fair access review. Will she give us some reassurance that that is part of what the Government are considering?
Baroness Smith of Malvern (Lab)
As well as the investment we are putting in, particularly for children with special educational needs and disabilities, we will consult on changes to the School Admissions Code to support fairness for all families, particularly the most disadvantaged. That will include improvements to how fair access protocols are managed by local authorities, requiring schools to give parents more information about decisions on in-year admission and, where they operate, making the operation of banding arrangements clear. Certainly, the first two of those will be very important for supporting parents in thinking about children with special educational needs and disabilities, and enabling them to get into the good schools that they would choose for them.
Baroness Barran (Con)
My Lords, I too welcome my noble friend to her place on the Front Bench. Does the Minister agree that we should congratulate and celebrate the 500 schools in this country that have added most value to the pupils attending them, rather than trying to pick holes in their performance?
Baroness Smith of Malvern (Lab)
I am not quite sure what the noble Baroness is referring to. I am always more than happy to celebrate the work of teachers and others in schools across this country that achieve enormously important progress for children every day. What is more, as a Government we have a responsibility to ensure that is available in as widespread a way as possible.
Lord Foulkes of Cumnock (Lab Co-op)
Will my noble friend spread the news to all pupils in England that they are lucky they do not live in Scotland, where there is a declining education system under the failing SNP Government?
Baroness Smith of Malvern (Lab)
I always try my best to spread the news about the excellent work that teachers in England are doing and, of course, the excellent work that this Government are doing to support them.
Baroness McIntosh of Hudnall (Lab)
My Lords, does my noble friend or her department have any information about the number of teachers currently working in our schools who have themselves at some time in the past needed special educational provision? To what extent are those teachers able to contribute to the way in which we provide for young people with special educational needs now?
Baroness Smith of Malvern (Lab)
That is a very interesting question. Although I have to admit that I do not have that information at my fingertips, I have no doubt that having had some of those experiences yourself would probably support you, as a teacher, to recognise the needs of the children you were teaching. But we cannot depend on that, which is why the Government have invested £200 million to ensure that all teachers, from early years through to post-16, have the opportunity for the necessary professional development to enable them to recognise and support children with special educational needs and disabilities.
UK Defence Capability
(1 day, 5 hours ago)
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Lord West of Spithead
To ask His Majesty’s Government what assessment they have made of the concerns raised by the Chief of Defence Staff in comments to the BBC regarding (1) the threat posed by Russia to the United Kingdom, and (2) the United Kingdom’s defence capability.
The Minister of State, Ministry of Defence (Lord Coaker) (Lab)
My Lords, Russia remains a significant and persistent threat to the UK and to Euro-Atlantic security through its war in Ukraine, hostile cyber activity, disinformation and sabotage against the UK and many other NATO allies. The Government have increased transparency around these threats, as seen through the recent exposure of covert Russian operators near UK waters. The MoD rigorously assesses the risks to the UK and to Euro-Atlantic security and takes action with our allies accordingly.
Lord West of Spithead (Lab)
My Lords, our Armed Forces and our defence industries are, I believe, teetering on the brink of disaster due to lack of investment over certainly the past 15 years but actually even longer and lack of decisions recently about spending the money that apparently is being released for defence. There is no doubt that they are in a very parlous state.
As an aside, I must say to the Minister how proud I was to see him honouring a relative, who I think had exactly his name, who was lost in the fighting in Normandy. One has to say that things such as fighting in Normandy happen when you do not have sufficient defence forces and deterrence has failed. That is the position we have got ourselves into.
In 1982, Margaret Thatcher released £2.5 billion at 1982 prices when the Argentinians invaded the Falklands. Where she found that money I do not know because economically things were not good. What are we doing to identify where the money can be found quickly to cover what needs to be spent now? I know he is very loyal, but there is no doubt that he is scarred by the shambles of the defence investment plan. What are we doing about finding that money and getting going? Otherwise, we have a real problem.
Lord Coaker (Lab)
It would be wrong of me not to say that I appreciate my noble friend’s remarks on Normandy. A number of us were there on Saturday; the relative of the noble Lord, Lord Evans, was the day after. My uncle, who I am named after, was killed on D-Day, soon after landing on Sword Beach. I really appreciate my noble friend’s comments.
On the current situation, he will know that the defence investment plan is due to be published and the Prime Minister has made clear that it will be before the Ankara summit on 7 July. We are in discussions about the money. He will have seen that well reported. I cannot tell him exactly what the outcome of all of that will be, but there will be additional investment. My noble friend is right to point out the need for us to increase our capability, and we are doing that. In terms of countering the Russian threat as it stands at the moment, we are not standing still, we are taking action with RAF Typhoons and are with working with our NATO allies in the North Atlantic and the High North. With his naval experience, he will know that the carrier HMS “Prince of Wales”, following a bit of maintenance in Norway, is now out ready for Operation Firecrest and that a number of operations such as Nordic Warden and Arctic Sentry are taking place to protect our interests, take action to counter the Russian threat and protect things such as underwater cables. Of course, there is a need for more investment, more readiness and more capability, but we are taking action with the resources we have now to defend our country as well and as much as we can.
Baroness Goldie (Con)
My Lords, wounds imposed by one’s friends are always more painful to bear than those imposed by one’s adversaries, so I shall try not to compound the Minister’s agony. The Chief of the Defence Staff has laid bare profound concerns about our capability. The noble Lord, Lord West, has encapsulated the problem succinctly, and I shall not repeat that, but at the heart of the chaos we find ourselves in is a fundamental difference of opinion between defence experts who get it and, arguably, a political leadership who do not. Can the Minister clarify precisely how and when this impasse will be resolved? We do not need talk about the defence investment plan; we need it now. We need to see the detail. It may or may not resolve the problem, but dither, delay and inertia are now completely unacceptable.
Lord Coaker (Lab)
I welcome challenge on these issues from His Majesty’s Opposition, my noble friend Lord West and my noble friends because it is important the Government are challenged on all these issues. They relate to the defence and security of our country and the defence and security of our continent and beyond so it is quite right to hold the Government and the Ministers who speak for the Government to account on this. The noble Baroness quite rightly asked me about the defence investment plan. I cannot do any more than say to her that the Prime Minister has said that the defence investment plan will be published before 7 July, which is the Ankara summit, the next NATO summit. That is all I can say to her. We hope to be able to publish it well before that, but all I can say to her is that work is ongoing. It will lay out the investments for the future as well as the type of capability that we need. All I was saying to my noble friend Lord West and I say to others is that we have already increased the amount of defence spending and are already increasing available capabilities and taking action where a threat is made against us to defend our country, our people and the alliances to which we belong.
Lord Lee of Trafford (LD)
My Lords, we still may sing “Rule Brittania”, but the reality is that our navy at present is, frankly, a national embarrassment. Obviously, we are glad that the “Prince of Wales” is now back in action, but will the Minister comment on newspaper reports that all our non-ballistic submarines are in dock and not available for current operations?
Lord Coaker (Lab)
It has been well reported. I have said from this Dispatch Box, and the First Sea Lord has said it as well, that the availability of submarines is not where the Government would want it to be. That is why we are investing, for example, £4.5 billion in the dockyards in Plymouth. The dockyards in Plymouth need investment, the dockyards in Scotland need investment, and we are looking at that. We are also looking at original ways of seeing whether we can provide docking facilities to increase the availability of submarines by looking at various provisions that do not require building or rebuilding a whole new dock. The noble Lord is quite right to point out that we need to do better on the availability of submarines. Of course we do. We will not comment on exactly how, and the noble Lord would not expect me to, but of course availability needs to improve and we are looking at how we can do that.
Lord Stirrup (CB)
My Lords, the focus has been on the defence investment plan, which is, of course, crucial, but does the Minister agree that capability is not just about capital investment? Resources expenditure, which is treated differently, is crucial. It pays for the fuel and spares that our people need to conduct training that is fundamental to their operational capability and it pays their salaries and for the standard of their accommodation. Does he agree that any plan that the Ministry of Defence brings forward that does not fund resource adequately will just continue the hollowing out of our Armed Forces that has taken place over the past two decades?
Lord Coaker (Lab)
I thank the noble and gallant Lord for the question. In any investment plan going forward, obviously the emphasis tends to be on capital as the noble and gallant Lord says—how many planes will we have, what we will do with munitions, and those sorts of things. However, he is quite right to point out the resource element of the budget—the day-to-day expenditure that pays for wages, training and all those things—is equally important, otherwise we run into trouble, particularly mid-year if there is a need to rebalance and look how to resource the particulars. The noble and gallant Lord often points out that if we do not get the resource allocation right, it impacts on the morale of the very people who serve our country. He is quite right to point that out. Discussions about the correct split between CDEL and RDEL is also going on.
Lord Harper (Con)
My Lords, the Minister drew attention to recent reports in the media about funding the defence investment plan. Given that we are only a few weeks away from its publication, assuming it does hit the pre-NATO summit deadline, does he think that what can only be described as a Cabinet whip-round to pay for the defence investment plan sends the right message to the adversaries that the Chief of the Defence Staff highlighted?
Lord Coaker (Lab)
The Government are looking at how they can increase defence spending, which we all want to see, and how we increase the defence budget. There is a variety of ways of doing that. He will know from experience that Governments often set budgets and then reorder priorities within them as circumstances change. That is a perfectly legitimate, perfectly reasonable thing for any Government to do. I say to the noble Lord that if the Government were not looking at how they are raising the money, if they were not looking at how to reorder priorities to find the money the noble Lord expects—as I do—he would not have asked that question. He would have reversed it and asked why the Government are not reordering priorities to meet the demands of the country and to fund the defence plan properly. Let me answer him: we are doing that and we will do it.
Lord Hunt of Kings Heath (Lab)
My Lords, on this issue of reprioritisation, given the fiscal restraints we are operating in, it is pretty clear that some resources will have to be found from other expenditures in government. Does he think the Government are doing enough to get across to the public why this is so important at the moment?
Lord Coaker (Lab)
The answer to that is that we need to do more on the national conversation. We are looking at how we do that. I have been made responsible for the national conversation. Should we have done more already? We probably should have done, but we will now. We need to persuade people and talk to them about the threats we face and what we need to do to tackle them. We have to bring people along with us. I think that one of the things that the Government need to do—working with others because it is a national effort—is to say to people: “These are the threats that we face, and these are the things we need to do”. It does require some reordering of priorities to do that. At the end of the day, the defence of the realm is really important, but that case needs to be made to the people of this country. We should not just assume that they will accept it.
Lord Wallace of Saltaire (LD)
My Lords, the SDR made it clear that the Russian threat is now not simply a threat from abroad in eastern Europe and the North Sea but is also a homeland threat. It suggested a number of measures for mobilising our domestic population and improving homeland defence and public awareness of it. Is that an MoD responsibility or one that other departments will deal with, and what priority does it have?
Lord Coaker (Lab)
The overall lead for homeland defence is with the Cabinet Office but, clearly, the Ministry of Defence has a role with respect to readiness and—in answer to my noble friend’s question—in talking to the public about how we fund this and prioritise spending within all that. Homeland defence across all aspects of our country is a Cabinet Office responsibility but, clearly, the MoD has an important role within it.
Baroness Boycott (CB)
My Lords, given that the threats are often cyber threats, which have not been mentioned so far, what investment is going into that? Is it in the Minister’s department or someone else’s, and how joined up is the thinking on all that?
Lord Coaker (Lab)
There is a Cabinet committee that looks at cyber defence and the MoD has just reorganised its cyber command to deal with the very threat that the noble Baroness mentions. The really important point is that warfare is changing. In the past, the military was always thought of as being tanks, airplanes and troops—all those sorts of things—whereas the warfare that we face now is cyber, disinformation and threats to underwater cables. You have to address all of that when asking what capability you need. Cyber is certainly one of them, and there has been some reorganisation within the MoD and across government to deal with that threat as well.
Lord Sterling of Plaistow (Con)
My Lords, we have talked about resources. We have talked about money and everything. When it really comes down to it, I say to the Minister—who I know has, over many years, had deep feelings for the defence of this country, without question—that it comes back to people. Given that we are in danger now, not necessarily in five or 10 years’ time, does he think that we have the right sort of people to be trained to be prepared to live, work, defend and, if necessary, die for this country?
Lord Coaker (Lab)
Yes, I really do. If people feel that their country, their livelihood, their families and way of life are threatened, and they understand that, I think people will. I am sure there will be a small minority who will not, including some conscientious objectors and others who may not have that view, but I take the view that the context is everything. If people feel threatened, I believe passionately that the British people, as they always have done, will defend their democracy, their homes and their family.
Baroness Antrobus (Lab)
My Lords, following on from my noble friend’s point about the national conversation, only last week I was briefed on research showing that senior military leaders and the heads of the security services have a particularly significant impact with the public when they talk in the media about the threats that we face. Does my noble friend agree that it would be beneficial for the national conversation that he is now responsible for, and which we need to have, if we could hear more from the Chief of the Defence Staff and the other service chiefs?
Lord Coaker (Lab)
I have always been of the view that in many situations—my noble friend has served, so she will know this—a military uniform gives a legitimacy to things that are said. That is quite right because, over many centuries, people have felt that those in military uniform have earned the right to be heard, and they believe that those people speak with integrity. In direct answer to my noble friend’s question, using all military personnel—not just senior personnel but military personnel of every rank, in their local communities and areas, including the reserves, and even cadets talking to other young people—in terms of a national conversation would be an immensely powerful thing to do. I shall make sure that we do that.
Rights of Boat Dwellers [HL]
Creative Education Access Bill [HL]
Constitution Committee
The Senior Deputy Speaker
South East Water: Disruption of Supply
(1 day, 5 hours ago)
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The Earl of Effingham (Con)
My Lords, climate experts are predicting that a super El Niño this autumn could lead to 2027 being the hottest year on record. We know this today, so what exactly are the Government doing now to prepare the country in advance and avoid the disruption to water supplies as seen last spring? There can be no excuses next year that the Government did not know it was coming.
The Parliamentary Under-Secretary of State, Department for Environment, Food and Rural Affairs (Baroness Hayman of Ullock) (Lab)
The Government established the Water Delivery Taskforce last spring to ensure that we have sufficient water supplies and wastewater capacity to support the Government’s ambitions and the country as a whole. Having sufficient water supply is absolutely critical for the country, and is something that we are taking very seriously. I am sure the noble Earl will be interested in looking at how the proposals in the water Bill, which is coming later this year, will also help to support the long-term security of our water industry.
Baroness Grender (LD)
At what critical point of failure are the Government willing to act in the interests of customers in the South East Water area, who have been failed time and again? Will the Government now urgently consider a different model from the previous Government—one which rejects shareholder profit being placed above investment in more resilient systems—and change to something like a mutually owned public-benefit model, or will we continue to see care homes struggling and businesses closing because they are failed by a service that is so fundamental? When exactly will we get a water Bill to fix this?
Baroness Hayman of Ullock (Lab)
I do not think there is anybody in this House who would disagree that the water industry needs a serious shake-up. That is one reason why we brought in, as a priority, the Water (Special Measures) Bill when we came into power in the previous Session, and it is why a priority for this Session is the water Bill that will come later this year. Clearly, proper support for customers is critical. We cannot have a situation where customers cannot rely on their water service. We will be bringing in reforms in that Bill that should lead to greater control in order that we do not continually end up in the situation that we have ended up in recently.
Lord Deben (Con)
My Lords, working as the chairman of a small water company means that one does know a bit about it. I just want to ask the Minister: when are we going to stop pouring fresh water into the sea during the winter in the east of England and then being so short of water in the east of England that the Essex & Suffolk Water company has announced that it cannot provide water for any new business or extension of an old business until 2036? The Government’s water Statement does not cover this fundamental nonsense. We should be collecting the water and having it so that people can get on with their jobs.
Baroness Hayman of Ullock (Lab)
The noble Lord makes good points. One problem that we clearly have is that there are parts of the country that have plenty of water and parts that have very little water. Unfortunately, the parts that have very little water tend to be the ones with the highest populations. We have to look at how we are going to manage that long term, because clearly what we are doing at the moment simply is not working and is not the right approach. Again, that is why we want to reform the water industry and shake it up properly. It is critical that the points the noble Lord makes are taken into consideration, because we have to get this right.
Lord Cromwell (CB)
The Minister knows that she has my full support in shaking up the water industry, as we have discussed on quite a number of occasions. While it is all very well for us to tell her to hurry up and supply more water, can she tell the House how long it takes to build a reservoir?
Baroness Hayman of Ullock (Lab)
That is a very good question. Obviously, we have not built a new reservoir for more than 30 years. That is one reason why we have reduced domestic capacity, as the noble Lord knows. We need to just get on with this as best we can. We are trying to get a co-ordinated system-wide approach to it. Havant Thicket is the first new reservoir, so we are using that as a live learning opportunity for the Government, regulators and the water companies, because we all need to work together if we are going to do this. A reservoir senior sponsorship group was established by the Water Delivery Taskforce, designed to both identify and resolve any barriers that we have in delivering a new reservoir. There has been talk of reservoirs for years, so we need to work out why it is not happening so that we can crack on and make it happen.
Lord Bassam of Brighton (Lab)
The South East Water company is something of a joke. If I lived in Tunbridge Wells, I would be “Angry of Tunbridge Wells”. The failures in supply in parts of Kent over the last two or three years have been quite profound. What measures can we take to make sure that the company improves its performance? Is there a case for it being taken into some form of control by the state?
Baroness Hayman of Ullock (Lab)
I am sure the noble Lord is aware that the chair and CEO of South East Water have resigned following calls from Defra Ministers. My colleague Minister Hardy met the company twice at the end of last month and wanted to understand better what it was doing about compensation plans, but also a proper action plan for this summer. South East Water has also been held to account through the Water Delivery Taskforce to scrutinise its infrastructure delivery. Obviously, we are also aware that Ofwat has fined it, but there is no point fining water companies if it does not fundamentally change their behaviour, so we need to go further.
Ofwat is looking at what to do about that. A licence investigation from Ofwat is going on because of South East Water’s repeated supply failures, and the Drinking Water Inspectorate is investigating the company. Ofwat has also opened enforcement action because South East Water is no longer complying with its investment-grade rating, as Moody’s obviously downgraded it. A lot is happening here but, fundamentally, we need to totally reform the water system so that this does not keep happening in the future.
Baroness Bennett of Manor Castle (GP)
My Lords, 84% of proposed UK data centres are in areas already in water stress or projected to be so by 2040, and water bills for households are expected to rise because of the construction of data centres. Does the Minister agree that we should not be building data centres where there is not enough water and that households should not be paying for this construction by tech companies?
Baroness Hayman of Ullock (Lab)
It is quite a challenge, is it not? How do we get that balance right? It is really challenging: we know in this country that we need more infrastructure, but how do we balance the needs of infrastructure with the water requirements that go along with that? The noble Baroness talked about data companies, but you could say the same for housing and other industries that use a lot of water, because we all do. We are looking at data companies in particular because we need to ensure that we have sufficient water supply without impacting on other areas.
Lord Berkeley (Lab)
My Lords, will my noble friend resist the temptation to build more desalination plants in areas of this country that are pretty wet already? In Cornwall, South West Water is trying to build a desal plant when it could perfectly well look at more reservoirs, rather than wasting power—which is in short supply around there—on pumping water up the hill.
Baroness Hayman of Ullock (Lab)
I do not know the detail of the proposals in Cornwall but, as I said, we need to get the balance right. It is really important. As I said in answer to the question from the noble Lord, Lord Deben, we have a problem with populations often being in the driest part of the country, so we need to get a proper overview of this.
Baroness McIntosh of Pickering (Con)
My Lords, a lot of the regulation relating to water still comes from the European Union. Will the Government look at that in isolation or as part of the water Bill when it is before the House this autumn?
Baroness Hayman of Ullock (Lab)
We need to look at it in the round. As the noble Baroness is aware, we are having a lot of discussions with the European Union at the moment, and it is important to learn from other countries and from what works in different places. Some countries are better at saving water than we are in this country, for example. I do not know the detail of where we will end up—negotiations are still ongoing—but we certainly need to take into account the way the European Union approaches water and the legislation that is likely to be with us.
Lebanon: Israel Defense Forces Operations
Lord Callanan (Con)
Over the weekend since the original Statement, Iran has launched ballistic missiles at Israel. Israel has since responded with retaliatory strikes against Iran. Of course, we all want to see peace in the Middle East, and the Prime Minister is right to call for a return to a ceasefire, but can the Minister please reassure the House that His Majesty’s Government will always recognise Israel’s right to self-defence? Secondly, over the course of the passage of the Crime and Policing Act 2026 last Session, your Lordships’ House voted three times to proscribe the IRGC. The EU has proscribed the IRGC, as has Australia. Can the Minister tell us why this country has not?
The Minister of State, Foreign, Commonwealth and Development Office (Baroness Chapman of Darlington) (Lab)
My Lords, of course I can assure noble Lords that Israel has the right to defend itself. We have said so consistently. We are extremely disturbed—noble Lords will have noticed this in the language we have used in recent days—about the actions taken in Lebanon. We completely understand the need to deal with Hezbollah, and we think that that is best done through the Government of Lebanon. It is really difficult to understand how the actions in recent days would bring about an end to Hezbollah. The noble Lord’s Government were in place for 14 years and had the opportunity to legislate to deal with the issue of the IRGC. This Government have committed to doing so, and we will as soon as we can.
Lord Purvis of Tweed (LD)
My Lords, I remind the House of my frequent visits to Lebanon over the last number of years, delivering a project supporting women to stand for municipal and parliamentary elections in the very areas where they have been under threat from Hezbollah over many years, so I have no sympathy with Hezbollah whatever. But one of the consequences of these yellow lines, if they are enforced, is the risk that Hezbollah will become active in areas of Lebanon other than where they are at the moment. My question to the Minister specifically concerns the areas being depopulated. The UK has over the last number of years has spent more than £117 million supporting the Lebanese armed forces’ capacity in the very areas the IDF now considers to be yellow zones. What is the current UK support for the Lebanese armed forces, and will we have any ongoing relationship in these areas?
Baroness Chapman of Darlington (Lab)
First, I commend the noble Lord’s work with women and girls in Lebanon. It is vital that we continue this work, and two weeks ago I was able to meet the Lebanese Minister for social affairs, who is an outstanding woman leader in Lebanon. Our support for the Lebanese army continues, and it is the right way to support Lebanon in defeating Hezbollah, a proscribed organisation. We support the aim of getting rid of Hezbollah, but it has to be done by strengthening the state and the Government of Lebanon.
Lord Pannick (CB)
My Lords, does the Minister have any sympathy for the people of northern Israel, who have been under constant bombardment from Hezbollah? Given that Hezbollah has made it absolutely clear that it has no interest in a peace settlement, is not the reality that unless Israel deals with Hezbollah, nobody will?
Baroness Chapman of Darlington (Lab)
I want to be absolutely clear about this: I have complete sympathy with the people who have been displaced and harmed and who are living in the fear the noble Lord talks about—of course I do, as does everybody else in this Government. It is important and essential that we rid Lebanon of Hezbollah. How we do that is not by razing whole villages to the ground and by killing 3,500 civilians and over 100 health workers. I do not see how the aims Israel says it has—aims that we all share, of ridding the world of Hezbollah—are met through that action.
Baroness Blackstone (Lab)
My Lords, I too condemn Hezbollah’s actions in northern Israel, but I am very grateful to my noble friend the Minister for what she has said about how this problem should be dealt with. Some 20% of the population of Lebanon has been displaced—well over a million people—and thousands have been injured and hundreds killed. This kind of aggressive action by the IDF and the Israeli Government cannot be the best way of securing a long-term solution to the problems Lebanon, its Government and many of its civilians are facing. Will the Minister therefore also say a bit more about what policies the Government are now following to try to get disengagement on both sides—Iran as well as Israel—so that a long-term solution can be found to the terrible problems the Lebanese are suffering?
Baroness Chapman of Darlington (Lab)
The first thing we need, as has been agreed previously but needs to be restated, is cessation of the violence we currently see. Where we have a role in that, we play it, as do others, including the United States. As far as our policies go, we are continuing to provide additional humanitarian support to the now one million-plus displaced people, and we have just had to allocate an additional £30 million to this effort because of the ongoing conflict. But I repeat that the right way to deal with Hezbollah—the only way, in the end, that is going to be a sustainable solution to this—is to strengthen the Government of Lebanon and the armed forces there to enable them to do this in a way that lasts.
Lord Howell of Guildford (Con)
My Lords, is it not an idea to offer some rather candid advice to our Israeli friends about the inner nature of Lebanon and the vast distinction between the Hezbollah structure—which is like a poisonous spider, poisoning every aspect of Lebanese affairs, including its politics—and the good people of Lebanon, who are friendly, have fought difficult wars in the past, have many different religions and are very supportive of our values and of this nation? Israel has some techniques which it has used for undermining the Hezbollah position very effectively, but its approach, which is to drop more bombs on everybody, including southern Beirut, is not the way forward. Dare we say that, in polite terms, because some of us know Lebanon very well, and Israel is doing it wrong?
Baroness Chapman of Darlington (Lab)
I think that we are making many of the points that the noble Lord outlines, directly and publicly, and noble Lords will have seen the moves we have made at the Security Council recently as well. In essence, I completely agree with the noble Lord, and the people of Lebanon themselves are the ones who have really borne the brunt of having to suffer living alongside Hezbollah for so long.
Lord Hannay of Chiswick (CB)
Can the Minister tell us what, if any, explanation the Government have had of the killing of a general officer of the Lebanese armed forces, another officer and a soldier by the Israel Defense Forces? Presumably, that does not come in the category of strengthening the Lebanese armed forces.
Baroness Chapman of Darlington (Lab)
It is difficult to see how that and the suffering of civilians and the deaths of civilians could ever be described in that way.
Baroness Hussein-Ece (LD)
My Lords, can the Minister outline the Government’s position on what appears to be the occupation of southern Lebanon, which seems to be a systematic plan to impose long-term military control and a new geographic reality? Is this not a clear breach of international law, and how on earth will it make anyone in the region safe, including Israel, if this kind of behaviour continues? What message is being sent out to other countries: that somehow, international law applies to only some people and some countries, and not others?
Baroness Chapman of Darlington (Lab)
International law applies to everyone, and territorial integrity matters everywhere. We are about to discuss a UQ on Ukraine, and I think the same applies. Things such as the raising of the flag at Beaufort Castle do not help; they raise tensions and weaken the Government of Lebanon. It is that Government we need to be strengthened in order to deal with this situation.
Lord Leigh of Hurley (Con)
The noble Baroness says that the only answer is to finance the Lebanese Government and the Lebanese army. This has been tried for years and has not been successful. The only successful way of dealing with, in effect, Iran in Lebanon through Hezbollah, is through military action. At what point do the British Government stop spending British taxpayers’ money helping the Lebanese Government, and, instead, allow the IDF to finish the job?
Baroness Chapman of Darlington (Lab)
With respect, I fundamentally disagree with the noble Lord. I wonder what he means by “finish the job”, given what we are seeing and the numbers of civilians who have been killed. Over three and a half thousand civilians, including children, have been killed indiscriminately. I could, perhaps, understand a targeted action. There would be questions about that too, but what we are seeing now is wrong.
Russian Attacks on Civilian Infrastructure
Lord Callanan (Con)
My Lords, Britain has stood resolutely against Russia’s illegal invasion of Ukraine, and we continue to support the Government in their opposition to Putin’s war. Britain has a role to play in weakening the Russian war machine through effective sanctions, working in close concert with our US and European partners. Can the Minister please explain why the Government have appeared to weaken their oil sanctions on Russia?
We welcome the Statement the Prime Minister made in March. The British Armed Forces are now able to board sanctioned vessels that are passing through our waters, and the Defence Secretary said something similar. To date, how many sanctioned vessels have been seized?
The Minister of State, Foreign, Commonwealth and Development Office (Baroness Chapman of Darlington) (Lab)
I think even the noble Lord knows when he says “appeared to weaken” that the story that was reported was not exactly accurate. We have new sanctions that we are introducing, although they will not be introduced perhaps as quickly as some noble Lords would like, and we can discuss them when they come before the House. But the idea that we have weakened existing sanctions is simply not correct.
Lord Purvis of Tweed (LD)
My Lords, we have seen in the conflicts in the Middle East we have just been discussing in the House, in Sudan and now in Ukraine, that there has been a systematic targeting of civilian infrastructure, which is a clear breach of Article 8 of the Rome statute and Article 52 of the Geneva convention. There seems to be impunity for combatants targeting essential civilian infrastructure. Will the Government make it very clear that both those perpetuating the targeting of civilian infrastructure and any country that is supporting, facilitating or providing any munitions that assist in the targeting of civilian infrastructure will be sanctioned by the United Kingdom, there will investigations into their breaches of international humanitarian law, and we will prosecute them through any means we have as a member of international judicial resolve?
Baroness Chapman of Darlington (Lab)
I do share, as I think the noble Lord knows, his deep concerns around the changing nature of warfare and what seems to be happening in many places, as he said, with the deliberate targeting of civilians and infrastructure. We do not comment about future sanctions, as he knows, but we will take robust action. We have been leaders in calling for accountability and for enabling some of the mechanisms by which that is achieved to be put into place around the world, and we will continue to do that. It is important that the UK maintains its reputation for standing up for the rule of law, and we will be champions for this whenever we need to be and using whatever mechanisms we need.
Lord Hannay of Chiswick (CB)
My Lords, will the Minister comment on the attack yesterday on the Chernobyl civil nuclear power facilities by Russian drones? Is it the Government’s intention, with other like-minded countries—such as France, Germany and, I hope, even the United States—to raise this matter to the governing board of the International Atomic Energy Agency and bring to its attention that this is completely contrary to all the rules of war?
Baroness Chapman of Darlington (Lab)
The noble Lord is absolutely right, and we will of course be raising this in every forum we can. I commend the work that our friends and partners in France have led on the safety of Chernobyl; it is disturbing to see these most recent events.
Lord Watts (Lab)
My Lords, does the Minister agree with me that what has gone on in Palestine weakens the international ability to criticise Russia, and that those people who do not make that case actually make it more likely that we will see more civilian attacks, as we have seen in recent weeks?
Baroness Chapman of Darlington (Lab)
I am not sure about that. It is possible and important, and it is our responsibility to call out what Russia is doing in Ukraine: abducting children, targeting infrastructure and carrying out relentless drone attacks on cities. This must be condemned, whatever someone’s views may be on Israel, Palestine and Lebanon. We have discussed this and it is very clear what the Government’s position is on that; it is consistent with the position we take on international humanitarian law in Ukraine and everywhere else. I do not think there is anything that could excuse what is happening in Ukraine and the behaviour of the Russians towards the people of Ukraine. The UK Government will continue to be steadfast in that view.
Lord Bellingham (Con)
My Lords, the recent Russian drone attack on the flats in Galați in Romania represents a major escalation indeed and is incredibly worrying. Is the UK going to lead a specific initiative in the UN Security Council on this, and what other action can the UK take alongside our partners?
Baroness Chapman of Darlington (Lab)
That is a good suggestion; I will take that back. We need to use all the mechanisms we have. Our work multilaterally is important, not only at the UN but through the coalition of the willing and the conversations here in London in recent days. I will take back the noble Lord’s suggestion, because we should be using every avenue we have.
Baroness Morgan of Cotes (Non-Afl)
My Lords, during the recent Recess, thanks to the Armed Forces Parliamentary Scheme, I, along with parliamentary colleagues from both Houses, was privileged to visit RAF personnel operating and supporting the enhanced air policing mission led by NATO. I was also going to mention the subsequent attack in Galați, Romania, which was very much pre-empted by the Romanian Ministers we saw. They were very keen to thank the United Kingdom for the support it has given, but I echo the calls: is there more that we can do? This is about Russia testing NATO up and down borders and across the Black Sea. It is very important that we, the United Kingdom, stand with others in pushing back as hard as we can against these Russian incursions.
Baroness Chapman of Darlington (Lab)
I could not agree more with the noble Baroness; the incursions we have seen into Romania are exactly as she describes. I pay tribute to her and all others involved in the Armed Forces Parliamentary Scheme. I took part, with the Royal Navy, and it is immensely helpful—it is one of the best things you can do as a parliamentarian who wishes to understand better how our foreign policy and defence work together.
Lord Howell of Guildford (Con)
My Lords, given the completely new structure and formation of the modern battlefield and the way war is being conducted, which is changing very quickly indeed, does the Minister or her colleague, the noble Lord, Lord Coaker, who was answering questions earlier—excellently—on defence and warfare, think that we have the right departmental structure of our own Government to meet the totally changed condition of war and its holistic nature, where every aspect of public policy needs attending to, and is our present ministerial committee system really good enough to meet this completely new challenge? I do not think so.
Baroness Chapman of Darlington (Lab)
I hesitate to be too definitive in response to this, because it is a really interesting question about how government works. Sometimes it works very well, but the noble Lord points to changing demands upon government that we do need to give more thought to in how we interact. Where it works well, it is brilliant. It is seen when we go into crisis, such as in response to the hurricane in Jamaica. At the moment, I am working very closely with colleagues in the Department of Health on Ebola. It can work very well. Whether those moments of working so effectively can become the daily norm is something the Cabinet Secretary will be bending her mind to as we speak.
The Earl of Clancarty (CB)
My Lords, further to what the noble Lord, Lord Purvis, said about infrastructure, Russia is a signatory to the 1954 convention on the protection of culture in time of war, and its recent attacks have been absolutely appalling and need to be called out very strongly.
Baroness Chapman of Darlington (Lab)
Clearly, Russia pays no regard to the commitments it has made previously on the protection of culture in times of war, or on anything else. The noble Earl is right that we should be condemning its actions on this, just as we do in so many other areas.
Children’s Social Care: Enduring Relationships Strategy
(1 day, 5 hours ago)
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Baroness Cash (Con)
My Lords, I thank the Minister for bringing this Statement to the House and for her kind words to me earlier. I look forward to working constructively with her in the coming months, in the interests of all children and young people.
We on the Conservative Benches welcome this Statement. Indeed, it was the previous Conservative Government who commissioned the review by Josh MacAlister on which this Government’s social care strategy is based. Children who enter care have often experienced circumstances too horrible for us to imagine. As they enter adulthood, as the report reminds us, they report much higher levels of loneliness and isolation, often lacking a single loving or supportive relationship. It is now well established by the evidence that higher numbers of adverse childhood experiences correlate with poorer life and health outcomes, so we will support, where possible, reforms to improve the care system.
I have some questions today. I particularly welcome the Minister’s focus on kinship care, but I wish to raise some points about the target of 10,000 new foster places—a laudable and necessary target. Surely some proportion of this is more easily achieved through the family. Currently, the proportion of fostering households through kinship care is just 20%, but finding foster carers among a child’s kin could be the surest and most efficient way of getting children into a placement in which they already feel a sense of safety and belonging. The biggest barrier is qualifying as foster carers, even though there are significant advantages to a child which might justify a less than perfect score. This would of course have to be done without compromising safeguarding, but it must merit further exploration. Will the Minister commit to revisiting this in this Session?
We recommend the expansion of regional care co-operatives, particularly to encompass children currently on, or at risk of, a deprivation of liberty order. However, I am concerned about the funding of these RCCs. The two RCC pathfinders in Greater Manchester and the south-east received £3.46 million in programme funding and £5 million in capital funding between them. The Government’s paper cites over £10 million to support the expansion of the six new RCCs. Unless I have misunderstood, that is a large discrepancy in per-RCC terms. Can the Minister tell the House whether she believes that this funding will be enough for all the new co-operatives or whether she expects more to be announced in the future?
We welcome the Minister’s resolution to secure the best possible outcome for care leavers, who too often, as I have said, have not a single enduring relationship in their lives. But there are some unanswered questions about how the new enduring relationship metric will be applied, and I would be very grateful for more information from the Minister. Will support for those who score lower be increased? What form will that support take? Will it allow for early intervention before those identified vulnerable individuals have left care? More information on all this would be very welcome. I look forward to hearing the Minister’s response.
Lord Mohammed of Tinsley (LD)
My Lords, I also welcome the Statement. It is important that we in this House send a strong message to young people in care that we are on their side. I know that on many occasions my noble friend Lord Purvis, who has just left his place here, has referred to those young people as having the richest parents—the corporate parents of the state—but often the state, particularly at the local level, has not been there to support them, so we welcome this enduring relationships strategy for children in social care. We have long believed that every child, no matter where they are and what their circumstances are, deserves the best start in life. That is what we want for our children. We the state, at both a national level and a local level, are the corporate parents, and if that is good enough for our own children, it should be good enough for the children under our responsibility.
We have long advocated for children in care because they have often been the ones who are overlooked, particularly those who reach adulthood but clearly still have issues. This overlaps with the debate that I am sure we will have following the Milburn review on NEETs, because those who have been in care are often overrepresented as NEETs. I am sure I will come back to that topic at a later date.
For too long, we have talked about the fact that some young people live in broken relationships. I pay tribute to my noble friend Lady Tyler, who wanted to be here but could not, because she has long campaigned for children. Often, one sibling is in care and the other is not. Maintaining that relationship is something for which she has campaigned for many years. I thank the Minister for her efforts to support the efforts of my noble friend, so that we were able to get that into the Children’s Wellbeing and Schools Act in the last Session of Parliament. That was an important change in the law and guaranteed that children in care are supported to stay in contact with their brothers and sisters. We want to make that upbringing closely mirrored to the ones that we all had and that, for example, my children are having.
Kinship care has a vital role in society. So often, that support is something that holds families together, and we have long called for the Government to support it financially. While they are there to support foster carers, we feel that kinship carers should also be better financially supported. Although we support the Government’s intentions, we must remind them that kinship carers still lack financial support. We tried to fix that during the passage of the Children’s Wellbeing and Schools Act, but on that occasion we did not succeed.
I have a couple of questions for the Minister. The Government mention a new financial allowance pilot for kinship carers. Will the Minister explain why the Government did not support the kinship care amendment to the Bill in the last Session? Similarly, the Government state that their goal is to shift children’s social care towards stronger families and stable homes, and that is welcome. But when a relative or close family friend willing to take on a child is located, they often face immense financial barriers. When will the Government guarantee financial support for kinship carers on a par with that for foster carers?
The Minister of State, Department for Education and Department for Work and Pensions (Baroness Smith of Malvern) (Lab)
I thank the noble Lords opposite for their welcome of the Government’s proposals around enduring relationships. The noble Baroness, Lady Cash, is right that the independent review of children’s social care was commissioned by the last Government and led by my honourable friend Josh MacAlister, the Minister for Children and Families. In that, he called for a relentless focus on enabling care-experienced children to build lifelong relationships, creating a tribe around them as they grow up. That is the basis of the enduring relationships strategy that we have published. It is framed around our central ambition to allow every child in care to maintain the loving, supportive and trusting relationships that they need to thrive. It builds on our recent work to legislate for social care reform, to reset how the system operates and to give our partners clarity on delivery.
In November 2024, the Government published Keeping Children Safe, Helping Families Thrive, which laid the foundations for reform. We followed through with the Children’s Wellbeing and Schools Act 2026, which many of us spent many happy long hours discussing as it wended its way through this House—I am sure we will have a suitably chunky Bill for the noble Baroness to enjoy in this Session. This has enabled the most significant overhaul of children’s social care in a generation, and these changes are supported by over £3 billion in funding across programmes, capital investment and implementation. Most recently, on 21 May, we published our implementation plan to support local partners to deliver these reforms. This work has laid the foundations.
Now, as noble Lords have recognised, we must move to the full implementation phase to bring about a real and tangible difference to children’s outcomes. A key focus of our reforms, as identified by Josh MacAlister in his review, is to help care-experienced children build long-lasting and loving relationships. Every young person needs relationships like these to form a strong sense of identity and to reach adulthood with confidence. The evidence is clear, as the noble Baroness identified, that just one stable, trusted and loving relationship can transform a child’s life. It can improve their resilience, health, education and long-term outcomes. Yet too often, the system does the opposite of facilitating the permanency that allows these relationships to grow.
In our strategy, we are setting out a new focus for children’s social care. We know that many social workers, carers and professionals work extremely hard to support young people to build and sustain trusted relationships, but often this depends on individual commitment rather than reliable structures. Therefore, to deliver this, our reforms will be aligned to four key outcomes. First, children’s social work must prioritise relationships, not just as an add-on but as the core purpose of practice—the lens through which every professional judgment is made. This is at the heart of the families first partnership programme, where mandatory family group decision-making will bring children’s families and wider networks into their care decisions at an earlier stage.
The noble Baroness, Lady Cash, and the noble Lord, Lord Mohammed, quite rightly raised the issue of kinship care. We are strengthening kinship care. Every local authority will be required to publish a local kinship offer, giving families the clarity and support they need. We have committed £126 million to pilot seven kinship zones, including family network support packages, which will tackle the barriers that can prevent families stepping in to support their kin. That work and investment will give us the basis on which to develop, as noble Lords have said, this important provision for young people. We have also strengthened local authorities’ duties to promote sibling contact for children in care, and the noble Lord is right about that. The noble Baroness, Lady Tyler, made a strong case for this during the passage of the Children’s Wellbeing and Schools Bill. At every point in proceedings, we must ask not only whether a child is safe but who matters to this child and how we can enable and nourish those relationships.
Secondly, we must create stable homes for children in care that support long-term relationships. That is why we are investing £88 million and working in partnership with fostering hubs and the sector to reform fostering and recruit 10,000 new foster carers. That will, in response to the noble Baroness’s question, involve reviewing standards, ensuring national consistency so that the rules in place support a child’s safety rather than limit the ability of foster carers to come into the system. Far fewer children should be in residential care and only when it is the best place to meet their current needs. Creating a route back to family life should be the focus of children’s care. Too often, the right residential care is not available, leading to child placement according to what is available rather than what is needed. That is why, to improve the planning and commissioning of residential care places, we are rolling out regional care co-operatives. We will have more to say about where those co-operatives will be and what support will be available for them in the near future.
Thirdly, we must support children’s transition to adulthood through supporting their long-term relationships. We are strengthening support for care-experienced young people so that they can move to independent living, supported by strong, trusted relationships. Through Staying Put and Staying Close, we are ensuring continuity of care and connection. Through strengthened corporate parenting, we are ensuring that public services step forward to support young people who have left care. Many children currently in care have already lost their most important relationships. That is why we are launching a national sprint to roll out family finding services in every local authority.
Finally, as noble Lords have said, we must embed the primacy of children’s long-term relationships through accountability and inspection. Care must be judged not on placement numbers or types but on children’s experience of them. We will have more to say soon about the measures that we will use for recognising success here. We are already working with local authorities and with Foundations, the What Works Centre for children’s social care, to determine how we will measure success here. We will announce more about that soon. Long-term relationships must be the standard by which the system judges success, so we will introduce an enduring relationships measure to gauge improvement and provide accountability. That also means that we will work with Ofsted to build enduring relationships into inspection criteria.
I welcome the support of noble Lords for these measures today. I look forward to working with noble Lords across the House as we make this fundamental difference to ensuring that all care-experienced children have not just the care and the safety that they need but the ability to keep, or rebuild, the enduring relationships that will be so important for their success in future life.
Lord Carlile of Berriew (CB)
My Lords, most children who appear before the criminal courts display evidence of serious educational needs and an alarming number of those children show signs of florid psychiatric illness. In the sunshine of very welcome reform, can the Minister assure us that we will not lose sight of the great clouds presented by those issues?
Baroness Smith of Malvern (Lab)
The noble Lord knows from his experience about the range of traumas that young people, even those who have not been in care, may well be reflecting. As he says, severe mental health needs may be one of them. That is why we are introducing mental health support into schools at an earlier stage. It is why, through the Department of Health, there is investment in 8,000 new mental health professionals and the development of a mental health strategy to ensure that children and young people in particular are getting support with mental health challenges at an earlier and more effective stage.
Baroness Armstrong of Hill Top (Lab)
My Lords, I welcome the Statement from the Government. It is uplifting to see the shift from being just the corporate parent to it being our responsibility—all our responsibilities—to ensure that for those children who enter the care system, for reasons we may not like and they may not like, we understand that the important thing for them is enduring relationships. I want to ask my noble friend about one aspect of the Statement in particular: long-lasting relationships. I have done work with Family Rights Group for many years now. It did the initial work on this, which has been followed up by Foundations, the What Works Centre, asking how you establish for young people in the last couple of years before they leave care a lifelong relationship.
All your children will have aunts, uncles, cousins and friends they can go to, even when they have fallen out with their mum and dad. These children have no one. I know from talking with them that, when they re-establish a relationship with a long-distance schoolteacher they had a good relationship with, or with somebody from their nursery or another area of their life, or they find a long-distance relative they did not know about, it makes an enormous difference. I know we are going to make sure that Ofsted is covering these things. Can my noble friend assure me that the slimmed-down Ofsted will have the resources to make sure these changes have the real effect that they are meant to?
Baroness Smith of Malvern (Lab)
On the last point that my noble friend made, it is precisely because of the importance of accountability that we will work with Ofsted to ensure that the measurement of enduring relationships and the development of enduring relationships are at the heart of the inspection process.
My noble friend also makes a very important point that, particularly for those young people who are in care but have already lost their most important relationships, it is not enough to simply say that is there nothing we can do to help them rebuild those. That is the reason for the announcement in the Statement about what is described as the
“national sprint to roll out family finding services”.
Those services do exactly what my noble friend has said: they sit down with young people, talk to them about who is now or was an important link and support in their lives, and then help them to remake those links to those people, who will support them while they are young but, as my noble friend says, will also be the people alongside them as they go into adulthood.
The Lord Bishop of Manchester
My Lords, from these Benches, I also warmly welcome what is in the strategy. Enabling children in care to sustain or make long-lasting relationships is absolutely crucial. When it comes to the lifelong relationship ceremonies, we on these Benches are certainly very interested in looking at what can be done to effect that. My question has come out of the work I did on my Private Member’s Bill for care leavers in the last Session. So many care leavers need to move from one local authority area to another, perhaps to maintain those relationships or to rebuild a relationship with a sibling, yet what traditionally happens is that the authority they have left washes its hands of them and the authority they land in considers it has no responsibility because they were never in care in that authority. What will the Government do to ensure that, where young people move from one authority area to another after they have just left care, they do not fall through the net any longer?
Baroness Smith of Malvern (Lab)
The right reverend Prelate makes a very important point. It is, of course, the objective of the Staying Close programme to enable young people, once they have left care, particularly if they were in residential care, to be able to continue to receive support. I will certainly go back and talk to my honourable friend the Minister for Children and Families about this point. I think that that is partly covered in the requirement for all authorities to have a support package for those who have left care, but the point about how we maintain the relationships that are at the heart of this strategy is a really important one that I will take up with him.
Lord Bates (Con)
My Lords, in welcoming the Statement, I also welcome my noble friend Lady Cash to the Front Bench. She brings great knowledge and understanding and, most importantly in this role, compassion, and we look forward to her further contributions. It is a tragedy in modern Britain that care leavers can emerge from care with no one they feel is there for them and no one they feel they can trust. For many of us, the source of those enduring relationships outside the family would be found in faith communities and sports clubs. Specifically, uniformed youth groups such as the Scouts, Guides and cadets built great relationships and instilled young people with essential self-discipline, self-worth and mutual respect. Does she agree that these are precisely the qualities that could benefit not only care leavers but all young people? If so, will she undertake to engage specifically with the uniformed youth groups to see how they can support this welcome initiative?
Baroness Smith of Malvern (Lab)
The noble Lord makes a really important point—notwithstanding the fact that my relationship with the Guides lasted about three weeks so could hardly be described as enduring. However, for many people, faith groups and youth groups of the sort that he has identified could well be the types of environments that could provide that support, that external help and some of those long-lasting links. I will certainly take that point back to my honourable friend as well.
Lord Addington (LD)
My Lords, it is quite clear that the Government are taking an important step forward here to support those from the care system and that everybody has recognised the lack of parental support going on into the early years of adulthood, which is incredibly important. Could the Government go a little further in how they are trying to bring these bits together? We have heard about the voluntary sector, schools and possibly even kinship care, but what will be the point at which we identify the hub that will connect these bits?
Baroness Smith of Malvern (Lab)
First of all, there is the structure being put in place through the implementation plans that the Government are producing, through the national framework, which has been relatively recently reviewed, and through the structures being proposed as part of the strategy. The best way to think about this is that what brings all these things together is the child or young person. If we change practice so that, at every point in thinking about decisions that are being made about children who have come into the care system, we ask ourselves, “What is the best way to enable relationships for this young person to be enduring or developed?”, that is the way in which we bring together the range of policy and investment that the Government are putting into this.
Baroness Bennett of Manor Castle (GP)
My Lords, I am sure that we will not hear any objection from your Lordships’ House to the strategy’s aim of putting enduring relationships at the heart of the children’s care system, but there is no mention in the Statement or strategy of the substantial barriers to that. They do not talk about the impact of for-profit companies, particularly those owned by hedge funds and other financial companies, on the provision of extremely expensive, often poor-quality care provided by lowly paid, frequently changing staff. We discussed this in the Children’s Wellbeing and Schools Bill and heard very little defence from any corner about this kind of provision. What are the Government’s plans to end this exploitation of some of our most vulnerable children? Have the Government set targets to reduce the provision of care by these deeply disturbing companies?
Baroness Smith of Malvern (Lab)
The reason why we discussed that in the proceedings on the Children’s Wellbeing and Schools Bill was precisely because we were taking action in that legislation to tackle this problem. We are empowering local authorities to secure the best placements for looked-after children at a price that is fair to the taxpayer. We know that local authorities cannot do this alone, so we are also taking action at national level to reshape the market through our package of measures, including those set out in the Act. We are rebalancing the market and improving competition, regulation and the commissioning of placements through the regional care co-operatives I have already talked about, and we will shine a light on the level of profit being made and bring greater visibility to the prices that local authorities are paying. In that legislation, we also took provision to introduce a profit cap if necessary.
Lord Wills (Lab)
My Lords, like all the other speakers, I very much welcome what the Government have done in this area and the emphasis they have placed on the importance of enduring relationships. I am very pleased to see that they have in many ways taken up the cause that my noble friend Lady Armstrong has championed for many years. How will the Government integrate these enduring relationships, whether with grandparents, aunts and uncles, former teachers or sports coaches, into the care process right from the outset, so that it is not an add-on but something that is fundamentally integral to the process?
Baroness Smith of Malvern (Lab)
That is a very important point. One of the important things we legislated for in the Children’s Wellbeing and Schools Act is the requirement for the use of family group decision-making in precisely that way, when thinking about children coming into the care system, by engaging their families and those who might have the capacity to support them at that point. That is a really important statement at the very beginning of the process about the need to think about kinship care and the support that families can provide.
Lord Bellingham (Con)
My Lords, I had the pleasure of working with the Minister in Committee on the Bill on the regional care co-operatives, and I am very grateful to her for agreeing to many of the things the Opposition were keen to have in the Bill. The successful expansion of the RCCs will depend to a large extent on good will and co-operation with local authorities in its implementation. Can she say something about how this will be achieved in the context of local government reform, which will mean many existing local authorities will be turned into unitaries and there will be a lot of changes across a number of counties and other areas?
Baroness Smith of Malvern (Lab)
The noble Lord is right that this is a period of local government reorganisation. It is also a time when local government finances are under considerable pressure, not least from having to find placements in an unplanned way, which is likely to lead to unexpected and very high costs. The very fact that local authorities can group together to use the planning and spending power of a regional care co-operative is beneficial to them at a point at which local government reorganisation is going on. Even more importantly, it is beneficial for the children who are more likely to have a placement that works for them, rather than simply one scrambled together on a Friday afternoon.
Lord Bailey of Paddington (Con)
My Lords, can the Minister give us some indication of what is being done to address the culture to make sure that these enduring relationships last? Is anything being done differently in the way the professionals involved are being trained? Is anything being done about the information given to the families in the first place? I was a youth worker for more than 35 years, and the most powerful relationships were where the family knew their rights and were pursuing them and could meet the professionals halfway. Are the Government doing any work to change the way in which the professionals now do their duties because of the new priorities of the Government?
Baroness Smith of Malvern (Lab)
The noble Lord makes an important point. To come back to the point I made earlier, we have changed things in the law such as the requirement for family group decision-making at an earlier stage. In this strategy we spell out clearly the need to change practice to focus on relationships at all stages of a child’s experience of coming into and being in care. I agree with the noble Lord that there needs to be a change in culture, and we are providing support for kinship care pilots and other initiatives such as the recruitment of 10,000 more foster carers. The central message here, as I suggested earlier, is that at every stage in a child’s journey social workers will be asking themselves: what do we need to do at this point to enable this young person to maintain or re-find the enduring relationships that will set them up for and support them for the rest of their lives?
Baroness Bennett of Manor Castle (GP)
My Lords, since there is time, my question relates to the ongoing monitoring of progress underneath this strategy, particularly whether the Government will be setting up a regular programme of listening to children in the care system and those emerging from it to see how fast progress is being made, what is being done better and what could still be strengthened. Will they be really listening to the children regularly as this strategy goes forward?
Baroness Smith of Malvern (Lab)
The noble Baroness makes an important point, and we talked about this at various points during the passage of the Bill. I assure her that in all the action that we take, particularly in children’s social care, we will want to centre children’s voices in the action being taken at a local level and listen to them in the development of policy.
Financial Services and Markets Bill [HL]
(1 day, 5 hours ago)
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Lord Stockwood
That the Bill be now read a second time.
Northern Ireland and Scottish legislative consent sought.
The Minister of State, Department for Business and Trade and HM Treasury (Lord Stockwood) (Lab)
My Lords, the financial services sector is one of the UK’s greatest economic success stories: we are the world’s largest net exporter of financial services, and it makes up around 20% of UK exports. The sector made 8% of UK GVA in 2025, totalling £224 billion. It plays a vital role in our economy, underpinning services that households and businesses rely on every day. It provides high-quality jobs throughout the country. It was in recognition of this that the Chancellor announced a significant set of reforms in her speech to the sector in Leeds.
I am very happy to take this Bill because I worked in the sector in the past. I was the CEO of an insurance technology firm offering protections to small businesses, and I have been on several boards of businesses in the financial services sector. While I no longer hold these roles, perhaps this is the right moment to declare my interests as set out in the ministerial register, in particular, a number of my investments in funds that are managed by FCA-regulated firms. In my role as Investment Minister, I see and hear first-hand just how far our financial services sector reaches and the extent to which our institutions, regulation and rule of law are respected overseas.
The Financial Services and Markets Bill will modernise how the sector is regulated, enable it to grow and lend more to businesses and make consumer protections fit for the digital age. It will achieve these objectives while maintaining high standards of regulation and oversight, ensuring that consumers and businesses continue to engage with the sector with confidence and that it will meet their needs. I am pleased that the Bill has been welcomed by a range of stakeholders operating across and alongside the sector. There is general recognition, as there was in an All-Peers meeting that I hosted last week, that it is a question of the balance we are trying to achieve.
As noble Lords would expect, this is a large, technical Bill, so I will briefly set out its purposes and why the Government have adopted the measures they have, and why we believe they strike that balance of promoting innovation and growth while managing and mitigating risk and, of course, protecting consumers.
Turning first to consumer protections and redress arrangements, Clause 1 and Schedule 1 repeal large parts of the remaining provisions of the Consumer Credit Act 1974 so that many of them can be recast into the rulebook of the Financial Conduct Authority, known as the FCA, continuing the changes introduced as part of the Financial Services Act 2012. The Consumer Credit Act was designed for the pre-digital age where everything was done on paper forms. It predates the smartphone by more than 30 years. Research shows that parts of the Consumer Credit Act can be harmful to potentially vulnerable customers, as lenders are often required to send complex communications that result in individuals feeling disempowered, confused and reluctant to seek help. This shows how bad regulation can harm consumers. The FCA is already responsible for making rules that protect consumers and has already made rules to replace some parts of the Consumer Credit Act. It has the expertise needed to perform this role and the powers needed appropriately to police compliance within the rules. Repealing more provisions of the Consumer Credit Act will ensure that it can make rules fit for the digital age.
Moving on, Clauses 4 to 12 reform the operation of the Financial Ombudsman Service, known as the FOS, to improve the consistency and predictability of its decision-making. At the moment, in a small but significant minority of cases, the FOS is acting as a quasi-regulator, by which I mean that rather than simply resolving individual complaints between consumers and firms as intended, its decisions have the effect of setting minimum standards for firms. This can lead to uncertain and inconsistent expectations and outcomes for consumers and firms, which undermines confidence. The Bill is reforming the “fair and reasonable” test as well, which guides FOS decision-making, introducing a mechanism to ensure greater coherence between the FOS and the FCA, and makes a number of other reforms to allow the FOS to successfully fulfil its original role as a quick and informal dispute resolution service.
Clauses 23 to 28 improve protections for consumers who purchase financial products through an “appointed representative”, for example, when purchasing insurance from a retailer acting on behalf of an authorised firm. The Bill will require the FCA to check that an authorised firm is up to the job of ensuring that its appointed representatives operate with high standards of conduct. When something goes wrong, the Bill will ensure that consumers of appointed representatives will be able to bring a complaint to the FOS, which is not always the case at the moment.
Now let me turn to the regulatory framework. I thank all Members of the House of Lords Financial Services Regulation Committee for their Growing Pains report that I read over the weekend. There is a strong alignment between the committee’s conclusions in the report and the Government’s perspective and actions. The Bill will consolidate the regulatory framework to deliver stronger co-ordination and clearer responsibilities.
Clause 13 and Schedule 2 will abolish the Payment Systems Regulator, known as the PSR, and consolidate its functions within the FCA. The PSR has been effective in driving competition and innovation among payments firms, but the current framework is too fragmented. The Bill will reduce the number of regulators that firms need to engage with.
The Bill also makes a number of reforms to support effective operation of the two largest financial services regulators, the Prudential Regulation Authority—PRA—and the FCA. The actions of the FCA and the PRA are absolutely critical to ensure that the UK has the right regulatory environment, as a key part of the Government’s financial services growth and competitiveness strategy. Clause 21 speeds up the regulators’ decision-making by reducing the statutory deadlines for determining a number of key applications, including authorising new firms. Clauses 29 and 30 create a new provisional licence regime, which will support innovative new firms by allowing them to begin operations on a temporary and limited basis while they apply for full authorisation.
The Bill also makes a number of changes to the internal operations of the regulators, to ensure that they are focused on their activities in the right places, and to support effective oversight and scrutiny of their work. The Government have looked at the wide variety of requirements currently applying to firms—some overlapping, some obscure and some simply of low value. Clause 16 requires the regulators to develop and publish long-term strategies. Clause 17 requires them to consider their existing eight regulatory principles when preparing or revising their long-term strategies, while removing the requirement to consider them every time they exercise one of their functions. Clause 18 removes a number of requirements on the regulators that are duplicative or impose a burden on them that is disproportionate to any transparency benefits that they bring.
Collectively, these changes are designed to ensure that government and Parliament can give clear direction to the regulators at a strategic level and support scrutiny of their broader approach in a way that is meaningful and impactful, rather than focusing on the minutiae or clogging up the regulators with process that adds no value. The Bill also supports the international competitiveness of our world-leading financial services sector, including through Clause 37, which enables the Treasury to create overseas recognition regimes to make business across borders easier without compromising consumer or financial protections.
I turn to the section relating to administrative burdens on firms. I have said the Bill ensures that the administrative burden that regulation puts on firms is proportionate, without compromising on core consumer, prudential and market protections. At the core of this objective are reforms to the senior managers and certification regime in Clauses 31 to 36. This regime holds senior leaders in financial services firms personally accountable for their actions. It is a vital regime that was introduced after the failures of the financial crisis, following the report of the 2012 Parliamentary Commission on Banking Standards. Many Members of the House were on that commission, including the noble Baroness, Lady Kramer, who I look forward to hearing from today. This regime has vastly improved the standards of governance and conduct across the financial services sector, and we have the noble Baroness and others to thank for that.
However, the way that the regime operates in 2026 results in significant regulatory burdens, costs and operational inflexibility. Following careful consideration, the Bill will reduce those burdens while retaining the core guardrails that the regime introduced. The Bill gives the FCA and PRA flexibility in how senior manager appointments are overseen and removes the certification regime which applies to roles below senior manager level. In its place, regulators will be able to make appropriate rules in their rulebooks.
Last week, I met many noble Lords, including the noble Lord, Lord Sharkey, the noble Baroness, Lady Bowles of Berkhamsted, and my noble friends Lord Davies of Brixton and Lord Pitt-Watson. They asked me for assurances that the Bill does not weaken the core protections of this regime. I am happy to give those reassurances. Firms will remain responsible for ensuring that those they appoint are fit and proper, and individuals will remain individually accountable for their decisions. This is not about deregulation but about ensuring that the rules operate in a more proportionate and targeted way.
I will now speak to the opportunities for credit unions. The Bill will enable credit unions to serve more people and communities, something I know will be strongly welcomed by many in this House. The Government are committed to supporting the growth of the mutual and co-operative sector, recognising the important role that credit unions play in promoting financial inclusion and providing affordable credit.
Clause 2 expands the common bond requirements for credit unions. It enables credit unions to reflect modern arrangements in our living conditions, allowing them to admit relatives of existing members who live outside the same household and members of the same household who are not relatives. It enables credit unions to permit retirees to remain as fully qualifying members, and to join after retirement. It also enables credit unions to admit students as eligible members under the locality bond, even where they do not live or work in the same place as they study. This delivers on a long-standing ask of the credit union movement, which the Chancellor is proud to be able to deliver, and is part of the Government’s ambition to double the size of the co-operative sector.
On lending and investment, Clauses 39 and 40 update the statutory framework underpinning the ring-fencing regime. This regime requires major banks to separate their UK retail services from riskier investment banking activities. I pay tribute to the Parliamentary Commission on Banking Standards, whose work was instrumental in establishing this regime. I want to be clear: ring-fencing has played a central role in strengthening the resilience of the UK retail banking sector since the financial crisis, but it is also true that the wider prudential and resolution regime has developed significantly since then. In particular, the UK now has extensive resolution powers to protect depositors and taxpayers in the event of future failure. The UK is therefore now in a much stronger position to respond to banking failure than during the global financial crisis.
The 2022 independent Skeoch review concluded that ring-fencing should be retained but identified areas of rigidity and recommended better alignment with the resolution framework. At Mansion House last year, the Chancellor announced a further review of the ring-fencing regime, and last month the Government set out a package of reforms designed to support growth while maintaining financial stability. The Bill makes changes to deliver the outcomes. It clarifies that the regulator need not duplicate rules where protections are delivered elsewhere, and it updates the statutory purposes to reflect how banks could fail today. Overall, these changes create a more coherent and adaptable regime that supports a more efficient environment for banks to lend and invest in the UK economy, while upholding financial stability and protecting depositors.
The Bill will also enable the Treasury to update existing legislation to help small and medium-sized enterprises, known as SMEs, to access lending through a wider range of lenders. Legislation already requires certain banks designated by HM Treasury to share credit information about their SME customers—subject to consent—with designated credit reference agencies to encourage greater lending. Since that regime was introduced, the probability of SMEs establishing new borrowing relationships has increased by over 25%.
However, almost 70% of new lending to SMEs now comes from outside those core designated banks, including from newer challenger banks and fintechs. Clauses 41 to 43 allow the Treasury to expand the scheme to a wider variety of lenders. For the first time, the Government are also extending the scheme to support the provision of credit to the charity sector.
Clause 44 advances the Government’s ambition to make the UK the location of choice for specialist and complex insurance by enabling the PRA to set more appropriate funding requirements for specialist insurance undertakings, known as transformer vehicles. Clause 45 advances the Government’s ambition to establish a new, globally competitive captive insurance framework.
I turn to anti-money laundering. I have spoken about the importance of maintaining the UK’s pre-eminent global position as a global financial centre. However, being a financial hub means that we now face heightened vulnerability to illicit finance. Money laundering firms harm legitimate businesses by distorting competition, increasing costs and enabling organised crime. The UK has a robust set of anti-money laundering rules, but the supervision of those rules is not consistent. So, in October 2025, the Government announced their intention to reform the supervision framework, with the FCA becoming the supervisor of compliance with anti-money laundering and counterterrorism financing rules for professional service firms. The detailed implementation will be through secondary legislation.
Clause 14 will allow the FCA to take responsibility for supervising anti-money laundering and counterterrorism financing among these professions. This will mean more consistent and effective supervision and improved collaboration with law enforcement. Financial crime increasingly takes place via crypto assets, which are increasingly held outside the UK. Several pieces of legislation enable the Government to seize illicit crypto assets with a connection to the UK. However, these powers have not been working effectively. The Bill enables the Government to ensure that they work as intended and can be modified as criminal practices evolve.
Finally, Clause 3 gives the Government the power to act on access to banking services. The way people access banking services in the UK has changed significantly over recent years. More and more of us are banking online and banks are closing branches in response. The Government are committed to ensuring that those customers who need it retain sufficient access to essential banking services in person. Banking hubs play a critical role in this ambition, and we remain committed to supporting the financial services industry’s rollout of 350 banking hubs by the end of this Parliament.
Last month the Government launched an independent review into access to banking services led by Richard Lloyd, former Which? director and former board member of the FCA. This review is to better understand the impact of the current trajectory, including the scale of any detriment to consumers, particularly vulnerable groups. The Bill contains a power to take action on access to banking services, including implementing the outcomes of the review should the evidence demonstrate that this is necessary.
I have been able to touch only briefly on what is clearly a wide-ranging Bill; I look forward to discussing it all in more detail. This Bill will help the financial services sector to grow and lend more to businesses, and importantly, it will make consumer protections fit for the digital age. When I began my speech, I said that the Bill is a matter of balance. I hope noble Lords will agree that it achieves its modernising objectives while maintaining the UK’s high standards of regulation and oversight. I beg to move.
Baroness Neville-Rolfe (Con)
My Lords, it is a pleasure to follow the Minister as we begin our deliberations on the Financial Services and Markets Bill. Like him, we believe that the financial services sector is one of Britain’s great success stories. It accounts for around 12% of GDP, supports 2.5 million jobs and contributes roughly £110 billion in tax each year. It is not simply a sector to be regulated; it is a national asset to be championed. We need the sector to grow because that will benefit us all.
Turning to the economy overall, we have unfortunately had a lengthy period of low growth following the financial crisis of 2007-08, and there is no sign of imminent recovery. Expectations are now for low UK growth in 2026. This continuing trend must be reversed. The Government’s rhetoric on the importance of growth must now be matched by serious action. Too often, warm words have been followed by policies that pull in the opposite direction. The Bill comes after a tidal wave of anti-growth measures, of which the Employment Rights Act is only the latest example.
It is our view that a major factor in our low rate of growth is overregulation, and that this is especially true of the financial services sector. Our Financial Services Regulation Committee agrees, and it is good to see the chair, my noble friend Lady Noakes, here today. Its excellent report, Growing pains: clarity and culture change required, which the Minister has already referenced, warned that
“the regulatory pendulum has swung too far towards elimination of all risk”.
That matters because an economy that seeks to eliminate all risk will, in the end, eliminate growth as well.
The consequences are already being felt. International firms are looking elsewhere. Businesses already operating here face costs that make the UK less attractive and less competitive. The CEO of Marsh McLennan told the committee that, from a regulatory perspective, the UK is at least six times more expensive than our next most expensive country. That is an extraordinary warning, and one the Government should take seriously. The question is whether this Bill measures up to what is required to meet the concerns of the committee and the wider needs of growth. I fear that, once implemented, the Bill will not lead to the step change required. As we take it through the House, a major perspective from which we will be judging it is its likely effect on growth.
However, in several respects the Bill is moving in the right direction. There is a broad consensus that reform is needed. The Treasury itself has acknowledged that the United Kingdom has been left with an overly complex system, and the National Audit Office has pointed to delays between problems being identified and regulatory action being taken. Industry has been saying the same thing. UK Finance has made it clear that the Consumer Credit Act 2006 is outdated and no longer reflects the protections needed in a modern digital market, and TheCityUK has called for a more coherent, streamlined post-Brexit framework.
We therefore welcome in principle the proposed changes to credit unions and the proposed transfer of the Payment Systems Regulator into the FCA. The changes outlined to the Financial Ombudsman Service are also positive, and we expect that this will bring some further clarity to its role and the regulatory landscape more widely. We also welcome measures designed to reduce approval timelines and to reform the senior managers and certification regimes.
Accordingly, the greatest problem with this Bill is not what is in it but what is missing from it. For example, it contains nothing on financial education—so key to improving our savings and investment culture and performance. More importantly, while this legislation removes significant amounts of old regulations, it hands extensive powers to the Treasury and to the regulators to design what comes next. Yet Parliament is being asked to approve that transfer of power without seeing in sufficient detail the regulatory framework that will replace what is being repealed. The incredibly broad powers in Clause 3, on in-person banking, are a good example. The repeal of a large volume of consumer credit architecture, with the expectation that much of what is removed from statute will later be recast into FCA rules, transfers responsibility for policy-making from Parliament to the FCA—that is another example, We believe that this is unwise.
Moreover, the obscure provisions in Clause 14 on anti-money laundering appear to give the FCA and PRA new powers to extend regulations and impose burdens on a number of professions not currently so regulated.
We are told by some that this is a deregulatory Bill, which is welcome, but deregulation ought not to mean removing rules from primary legislation and recreating them elsewhere, beyond proper parliamentary scrutiny. The test is not just whether the statute book looks thinner but whether the burden facing firms is actually reduced.
I am sure the Minister will point to the regulators’ growth and competitiveness objective, but the Financial Services Regulation Committee was clear that this objective has not yet translated sufficiently into policy or practice. Recent history does not give us confidence that a culture of risk aversion, delay and excessive caution will correct itself without stronger statutory direction, clearer accountability and more effective parliamentary oversight.
There is also a wider question about whether the regulatory framework being created will be fit for the future—the Minister touched on this. Financial services are changing at extraordinary speed, led by remodelling overseas, especially in the US. Digital assets are becoming more sophisticated and more integrated into mainstream finance. We are now discussing sovereign bonds on blockchains, digital settlement systems, tokenised assets and new payment technologies capable of transforming everyday transactions.
Yet industry is warning that the Government still lack a clear strategy for digital assets. As a result, firms face uncertainty, innovation is delayed and businesses connected to digital asset activity risk being debanked. I fear that other countries are moving faster in this area. The United Kingdom should be leading in this space; we have the legal system, the financial expertise, the history, the capital markets and the international reputation to do so.
We also need to have regard to the competitive interest of our UK firms. One very senior banker has warned me that the last-minute proposals on ring-fencing would be welcomed by his overseas competitors, since it would reduce his competitiveness. There is also concern from our huge insurance industry, where the UK is a true world leader, with 69% of income coming from overseas. It fears that downgrading the proportionality duty and confining its application to long-term strategies rather than regulatory decisions will make the UK a less attractive place to do business.
Before I close, I will ask some questions of the Minister. First, are present Ministers determined that the regulations made under this Bill will prove less onerous in practice than the architecture they replace? Secondly, what assessment have the Government made of the FCA’s operational readiness to take on the additional responsibilities conferred by the Bill? Thirdly, is the Minister confident that the measures in the Bill will materially reduce delays in authorisations and approvals, particularly for smaller firms, challengers and new entrants? The ability to stop the clock without an independent arbitrator undermines the targets. Fourthly, is the Minister confident that, following the adoption of the Bill, regulator behaviour will become more growth-focused?
There is a missed opportunity at the heart of the Bill. It contains measures that we welcome, as I have said. It moves in the right direction. It recognises, at least in part, that the current system is too complex, too slow and too burdensome. For that reason, we will approach the Bill constructively, and I look forward to working with the Minister on many of the details, not least given his background in the sector that we are discussing. I hope and believe that there are medium-scale issues on which we can reach agreement in this House, but there are two broad problems, as I see it.
The first is that this is a Bill that begins the process of reform but does not, on its own, meet the scale of the challenge. The test for the Bill is not simply whether it makes technical changes to the financial services framework, but whether it helps make the United Kingdom once again the most dynamic, competitive, innovative and attractive financial centre in the world. The second is that we are being asked to take a lot on trust, because of the remarkable degree of delegation in the Bill. We are required to trust that the regulators will deliver in a timely and effective way, that the Treasury will deliver the necessary framework and that Treasury Ministers will oversee the step change that we need. Looking to the past and to the volatility of current politics, can we really put so much trust in the proposals before us?
Lord Sharkey (LD)
My Lords, I welcome this Bill and the growth in competitive objectives that inform it. I thank the many organisations that have provided us with briefings, especially the APPG on Investment Fraud and Fairer Financial Services. Its 70-page analysis deals with each part of the Bill in depth and reaches an important overall conclusion, which is that the case for protecting consumers within any reform of financial services is not merely a moral case, although the moral case is strong, it is an economic case, grounded in a clear-eyed analysis of how trust works, how it is destroyed and what happens to markets when it is lost. The report also notes that the Bill should not simply make complaint handling faster or more predictable for institutions; it should ensure that ordinary people can get the real issue investigated, decided, escalated where necessary and put right. It is not at all clear that the Bill does this or does this sufficiently.
A look at Part 2 illustrates the problem. It contains a number of significant reforms: Clause 5, for example, which concerns the appointment of the chair of the FOS scheme operator. Under this clause, the chair is appointed directly by the Treasury. This is a major structural shift that was not included in the original consultation. The clause also states that the terms of appointment must secure the chair’s independence from both HMT and the FCA. The ombudsman scheme occupies a unique position within our regulatory architecture. It must command the confidence of consumers while maintaining credibility with the industry. Independence is therefore essential: it is not merely a matter of statutory wording; it is also a matter of perception. Where appointments are made directly by the Government, questions inevitably arise about whether sufficient distance exists between Ministers and those exercising important quasi-judicial functions.
Clause 6 also contains significant reform proposals. It addresses time limits for complaints under the compulsory jurisdiction. It introduces a long-stop period of 10 years from the relevant act or omission, while preserving the possibility of alternative limits set through rules and allowing exceptions in specified circumstances. This is a process which, though critical, allows no meaningful parliamentary scrutiny. It is of course true that there is a strong case for providing greater certainty. Financial firms should not face indefinite exposure to complaints relating to events that occurred decades earlier. It is also true that financial misconduct can sometimes take years to emerge. Consumers may not discover that they have suffered detriment until long after the original transaction occurred. The challenge is one of balance. Parliamentary involvement will be helpful.
Still in Part 2, Clause 7 introduces one of the most consequential innovations in the Bill: the referral of matters from the FOS to the FCA. The ombudsman may also seek the FCA’s opinion of FCA rules where ambiguity exists. This proposed reform reflects the concern that individual complaints can sometimes raise wider questions affecting thousands of consumers and firms. The proposed reform also reflects long-standing industry criticism that the ombudsman has occasionally interpreted regulatory requirements differently from the regulator. In reality, however, it is hard to see this as a well-founded or convincing criticism of the current set-up.
The FOS resolves over 200,000 cases each year, upholding about 30%. We are told that the FOS is acting inconsistently and that it has strayed into becoming a quasi-regulator. If that were true—if this were really a systemic problem—the Government should be able to produce a substantial body of evidence. If it were true, there should be hundreds or even thousands of FOS decisions demonstrating this pattern. If such a list exists, HMT and the FCA have not published it—it is certainly not in the impact assessment. If such a list does not exist, the case for much of the reforms to the FOS rests on assertion rather than evidence. I invite the Minister to point us towards the specific FOS cases that justify the proposed sweeping reforms.
As things stand, the Government appear to be jumping to conclusions that will reduce access to the FOS, reducing access to free and impartial redress; introduce extra bureaucracy and costs; and, ultimately, damage confidence and trust in the financial services industry. We must guard against any risk that the ombudsman becomes subordinate to the regulator or loses the independence that has been central to its legitimacy. There is a strong case for removing Clause 7.
Clause 8 reforms the test used when determining complaints under the compulsory jurisdiction. This may well be the most controversial provision in Part 2. Historically, the ombudsman has determined complaints according to what is fair and reasonable in the circumstances. Critics have argued that this has sometimes allowed decisions to diverge from the regulatory rule book, creating uncertainty for firms that believed that they had complied with the FCA requirements.
We should ask ourselves whether strict alignment with regulatory rules could weaken consumer protection in cases where the rules themselves are incomplete, outdated or silent on emerging risks. The strength of the ombudsman system has been its ability to look beyond technical compliance and to consider fairness in a broader sense. If that flexibility is narrowed too far, some consumers may find that conduct that was plainly unfair nevertheless escapes effective remedy.
There are already voices, such as the Centre for Responsible Credit, calling for the removal of Clause 8. StepChange has said:
“The ‘fair and reasonable’ test was carefully designed by Parliament”,
requiring FOS to consider
“all the circumstances of the case”.
In contrast,
“FCA rules are often high level and permissive”.
StepChange believes that:
“The scope and flexibility of the test is essential for FOS to decide cases in a manner that is … fair”.
Shifting this to be based on compliance with FCA rules risks creating a tick-box exercise and weakening consumer protection. Martin Lewis has warned that:
“Restricting … access to free and fair redress is not a recipe for economic growth. Once consumers are warned about the erosion of their rights, it’s possible it will lead to disengagement from … financial services … and diminishing trust”.
On this issue, as on others in the Bill, Parliament must ensure that in pursuing regulatory certainty, we do not sacrifice fairness; that in pursuing efficiency, we do not diminish accountability; and that in strengthening regulatory co-ordination, we do not weaken the independence of the ombudsman. The UK’s financial services sector thrives not merely because it is competitive but because it is trusted. To be trusted, consumers must have confidence that when things go wrong, there is an independent, accessible and effective route to redress.
The Bill may not expressly repeal consumer protections or statutory rights; the concern is more subtle. Rights created by Parliament may be diminished in practice if access to redress depends on FCA rule compliance, FCA intent, FCA interpretation or Treasury-made conditions rather than independent interpretation of the underlying legal issue.
I close by quoting Which?:
“The proposed reforms to the FOS and the FCA appear to come at the expense of consumer protections. Any benefits arising from weaker consumer safeguards are likely to be temporary while longer term costs could be significant, particularly for vulnerable who rely most on access to redress and effective regulatory protections”.
I agree with that.
Lord in Waiting/Government Whip (Lord Wilson of Sedgefield) (Lab)
My Lords, before we move on to the Back Benches, I remind noble Lords that the advisory time limit is eight minutes. If we all stick within that, we can get everybody in, it is fair to everybody else and we will be able to finish at a reasonable time.
Lord Burns (CB)
My Lords, this Bill is another example, I am afraid, of my past catching up with me. It is 27 years ago that I was asked to chair a Joint Select Committee of both Houses to scrutinise the draft Financial Services and Markets Bill that was introduced back then. The committee met for three months and published two reports. I believe the noble Lord, Lord Eatwell, is the only other member of the committee still in this House. That became the Financial Services and Markets Act 2000, and all the subsequent changes that have taken place, including in 2012, have been amendments to that Act. I also note my interests in this legislation as outlined in the register. I own shares in Banco Santander and Flagstone Group. Furthermore, I was chairman of Abbey National and then Santander UK from early 2002 until 2015.
It is worth recalling some of the factors that lay behind the need for the Bill back in 2000. The first, of course, was the decision by Chancellor Gordon Brown to remove banking supervision and regulation from the Bank of England and to transfer those responsibilities to the proposed Financial Services Authority. Secondly, this provided the opportunity to consolidate various financial regulatory bodies that had previously operated independently, including—and this is just the beginning of the list—the Building Societies Commission, the Securities and Investments Board, several self-regulating bodies and various ombudsman schemes. In fact, it is really quite astonishing to think back at how complicated and complex the arrangement was before the 2000 Act. Thirdly, there had been—as there always seem to be—problems with a number of financial institutions during the time I was Permanent Secretary, including the closure of BCCI, the collapse of Barings and some difficulties with smaller banks; before that, there had been the collapse of Barlow Clowes. So there were quite a lot of lessons to be learned, and the Bill aimed to put those into a comprehensive framework.
The committee agreed with the Government, and one of the significant issues that came up was that the appropriate approach to this legislation was that it should be principles based rather than rules based. Even then, the financial services industry was growing rapidly. The building societies were in the process of becoming banks, the banks were getting involved in the mortgage market, and a principles-based approach was seen as the most practical way to ensure that the regulatory process remained fresh and relevant as these changes progressed.
As explained in the Explanatory Notes, this approach involves a three-stage process, and it can make it look very complicated. Some of the issues we have already heard from the noble Baroness, Lady Neville-Rolfe, are the product of the way in which this was designed. It remains the case that Parliament sets the overall regulatory framework in primary legislation, including the regulator’s objectives. The second step is that the Treasury then sets the regulatory perimeter through secondary legislation, including specifying which activities are regulated and in what circumstances. The third step is that the PRA and the FCA operate as independent statutory bodies responsible for setting and enforcing the detailed rules for firms engaged in regulated activities.
Some of these issues about when and what should come to Parliament, what should be in delegated responsibilities and how far the regulators are allowed to set the rules are always going to overlap each other, and people will worry about them at various stages. But it is important to recognise, through the discussion and debates that will take place, that from the beginning this three-stage process has been in mind.
I believe the principles-based legislation has been effective for this fast-moving industry. However, achieving the right regulatory balance, as we have heard this afternoon already, is very challenging at any time. Sometimes, regulation becomes overly burdensome and the economy suffers. At other times, insufficient regulation can lead to consumer harm, detriment or the failure of firms. Lots of factors influence this balance, including external development, product innovation, the expectation of customers and the level of effective competition. Therefore, it is important to periodically review these various components of the principles-based approach, to assess their effectiveness and to determine whether any rebalancing is necessary.
I regard many of the changes proposed here as very sensible rebalancing of the factors involved. In the past, of course, rebalancing has happened on several occasions. Following the financial crisis, it became clear that banks’ capital requirements had been insufficient during the run-up to the crisis. It was demonstrated clearly in a subsequent FSA report into RBS. Banks had held too little capital against the complex products that they were dealing with, and many banks were overly reliant on the interbank market for funds, with lending overconcentrated in the real estate market. Subsequently, the FSA and the FCA rightly raised capital and liquidity requirements. The question is: did they change them by the right amount? Was it sufficient or was it excessive? At the time, of course, it was understandable—we had been through this very painful process—but the later evidence suggested to me that the response had been excessive. It contributed to a sharp reduction in bank lending to the private sector, particularly to SMEs. This in turn has had some substantial knock-on effects. Given the subsequent evidence, my view is that some rebalancing of the capital requirements is appropriate. The ring-fence banks should also be looked at to adjust the size of the ring fence around which they operate.
It is also important to recognise that the rapid growth of new products also led to underregulation of some products at times, leading to consumer detriment. Product details were not always clearly communicated to customers, as we would expect today, but this has to be seen against the huge success of the introduction of internet banking. It is also important to ensure that senior people working in the financial industry are fit and proper, but again the question is of balancing bureaucracy against—the question has been raised—a less onerous approach.
This is a dynamic system; getting the level of regulation right has to evolve over time, but it is never going to be a straightforward task. I regard this Bill as an important part of trying to move forward that rebalancing.
The Lord Bishop of Manchester
My Lords, I declare my interests as set out in the register. As with all my colleagues on these Benches—not that there seem to be many of them here today—my stipend, pension contributions, housing and working costs are provided by the Church Commissioners for England. As an issuer of bonds, something we started when I was chairing, it is a regulated body.
I welcome the intention behind the Bill to modernise our financial services and to support economic growth. However, our aim must be to enable economic opportunity for all communities. Amid what is still a cost of living crisis, we must measure economic success not only by the growth of the economy itself but by how it promotes the dignity of those most in need and protects individuals at times when the system fails. It is a large Bill, so I will focus on just a few main aspects: access to credit, credit unions, consumer protection, and access to wider banking services. These are probably the issues that are most appropriate for one who is a bishop, not a banker.
Access to fair and affordable credit is not simply a financial issue but a matter of dignity, equal opportunity and participation in community life. Deepening poverty across the UK is making it more difficult for people to break free from debt. Almost everybody needs to borrow money at some point in their life, yet too often it is those with the least who end up paying the most. They face a poverty premium; they have fewer options. Christians Against Poverty, a wonderful charity, has found that its clients are now borrowing money simply to pay for food, clothing, rent and utility bills. For many, credit has ceased to be a tool for flexibility; it has become a necessity for meeting basic needs, and that drives them deeper into debt.
Debt fosters feelings of shame, fear and hopelessness, which often prevent families from then reaching out for support. Christians Against Poverty states that 46% of clients it surveyed had gone as far as considering ending their own life because of debt-related pressures. We cannot overlook the emotional toll of financial insecurity on real lives. The inaccessibility of credit for underserved communities creates a significant gap in financial policy, where these effects could be alleviated. As such, I strongly welcome measures in the Bill aimed at addressing the problem. These efforts must be sustained and targeted, and we must ensure that those facing the greatest barriers are not left behind.
I was first involved in setting up a credit union almost 40 years ago. It astonished me just how small the sector was in England. It has grown a bit since then: 2.16 million people in Great Britain are now members of a credit union, and we have a credit union for Church of England and other clergy. But Britain still compares poorly with other similar economies in what is, across many nations, a network of trusted, community-based saving and borrowing solutions, particularly for those communities least well served by conventional banking. Hence, I strongly welcome the measures in the Bill to promote the expansion of credit unions, including, critically, the broadening of common bonds to increase the number of people able to access this kind of credit.
This measure is particularly important for serving those in more deprived areas, where they may not previously have had access to banks or similar opportunities. While expanding credit unions will go a long way towards improving access for many customers, it remains the case that certain communities, such as migrants or individuals with less financial literacy, remain excluded from the credit opportunities offered by the mainstream banks. What might the Government consider doing further to improve transparency and accountability among mainstream lenders in how they serve marginalised groups alongside an expanded credit union sector?
I turn to financial protections. Increasing credit availability is an important step forward, but it must be met with adequate protections to prevent mis-selling or overborrowing and to ensure proper redress when things go wrong. While I understand that the proposed changes to the Financial Ombudsman Service are designed to streamline the process, I am concerned that stricter criteria there may make the whole process more inaccessible and less robust. Some proposals, such as stricter time limits on making complaints, may present barriers to certain consumers making claims in the first place, particularly when they discover the issue only after many years.
I also echo concerns expressed by the noble Lord, Lord Sharkey, on the proposed reforms to the Consumer Credit Act. While modernisation is clearly needed, the shift away from detailed legal protections towards regulator-led rules may, as others have said, reduce parliamentary scrutiny and weaken established routes to redress. It may also reduce certainty for consumers, making it less clear when they are entitled to redress and how they can secure it. Again, that is likely to have the greatest impact on those who are less financially literate and who may struggle to navigate complex financial systems alone.
Furthermore, existing protections, such as those offered by the consumer duty, do not provide protection to communities which are excluded from credit access in the first place. Without real efforts from mainstream providers to incorporate underserved groups in credit opportunities, those most in need of support will continue to fall through the cracks. Therefore, it is essential that protections evolve alongside access, ensuring that increased participation in financial services does not come at the expense of security. I will follow with interest the debate about how much ought to be in the Bill and how much can safely be left for later regulation. I welcome the Government’s proposed scheme to improve financial literacy in schools by 2028, but that is no replacement for adequate routes to redress, democratic accountability, and fair and equal access to credit for everyone who needs it.
Finally, while I suspect that, nowadays, many of us in your Lordships’ House access all our banking services electronically—I cannot remember when I last went into a bank or even rang one up—there are those in our communities who need access to in-person banking services beyond mere cash. Financial exclusion fosters real-world isolation. Many of the communities that the Church supports, such as elderly and disabled populations, face greater barriers to financial independence in an increasingly digital age. I am not sure that we are doing quite as much as we should in the Bill to ensure that in-person services, beyond cash, are available in both urban and rural settings.
The Bill presents an important opportunity, not only to modernise our financial system but to ensure that it serves the common good. We must reflect not only on how the Bill will enable growth but on how it might promote justice, equality of opportunity, and dignity for the communities that are the most in need. I look forward to engaging with its progress through your Lordships’ House.
Baroness Hodge of Barking (Lab)
My Lords, I thank the Minister for his excellent introduction to what is a complex and technical Bill. I will focus, as the Prime Minister’s Anti-Corruption Champion, on a part that may not be at the top of everyone’s agenda—it was not in the Minister’s top half. For those of us engaged in efforts to tackle the challenge of dirty money, it comprises an important and welcome proposal set out in Clause 14.
Tragically, over recent decades, Britain has become the destination of choice for too many wanting to hide or launder their dirty money. The National Crime Agency estimates that £100 billion is laundered into the UK annually. Academics estimate that, if you add this to the money lost through fraud, the cost of economic crime to the UK rises to £350 billion. That is more than five times what we spend on schools in England, or nearly six times the amount Britain currently spends on defence. It is huge and a loss that harms our economy, undermines trust in the integrity of the financial services sector, threatens our security and damages our public services.
However, the guilty criminals responsible for these crimes do not invent the schemes used to hide or launder their ill-gotten gains. They depend on the advice of professional enablers—accountants, lawyers, banks and company service providers—who devise the schemes and then enable, facilitate or collude with the economic crime. Most professionals work in both a lawful and an ethical manner but, sadly, there are some bad apples in the professions, who must be rooted out and punished. At present, the professionals are not adequately supervised and identified, and, too often, they are left free to pursue their highly profitable but immoral and, in some cases, unlawful practices.
Introducing a robust, efficient and effective supervisory scheme for vigilantly vetting the professionals should have a dramatic impact on the incidence of economic crime. Punish and get rid of the bad apples, and wrongdoers will lose their access to advice and support on how to hide or launder money. At present, 22 separate organisations supervise accountants and lawyers. Many of these bodies also act as advocates for their members and do not have effective systems in place separating their regulatory and advocacy functions.
There are a further three government bodies that supervise other relevant professionals. OPBAS, the body tasked with supervising the supervisors, recognises that the current system is inadequate. In its March 2026 report, it states that the supervisory bodies
“continue to perform poorly in their enforcement approach”,
and that some are not
“undertaking consistent, proportionate and sufficiently dissuasive disciplinary measures in circumstances where it would be warranted and justifiable”.
Statistics confirm this judgment. The Chartered Institute of Taxation found that 31% of firms it visited were not compliant with anti-money laundering regulation, yet only four were disciplined: three were fined and one was suspended. The Council for Licensed Conveyancers imposed no fines at all, despite finding that 62% of firms that it supervised were non-compliant. The Solicitors Regulation Authority cancelled the membership of just one professional body in 2023-24, and the fine imposed on Mishcon de Reya in 2022 for multiple breaches of the AML regulations was £232,500; it would have been £5.4 million had it been calculated by the rules used by the FCA. So, I strongly support the Government’s proposal to merge the supervisory bodies into one body that will operate within the FCA. This will create a simpler and more consistent framework that will be better placed to work with law enforcement agencies and will have access to data, allowing a joined-up approach across the professional disciplines.
However, I seek some assurances from the Minister to strengthen the effectiveness of the proposed change. To ensure that the FCA properly prioritises this work, will the Government ring-fence the funding the FCA will receive in fees from legal, accountancy and company service provider firms and ensure that those resources are used to fund its supervisory and enforcement duties on money laundering? Will the FCA maintain a register of supervised entities, as it does for financial institutions, so that companies providing unlawful services that are not registered can be identified? Will the Government ensure that data collected as part of the supervisory process can be shared with law enforcement agencies and that those agencies share their information with the supervisory arm of the FCA? Will the Government ensure that the FCA can access legally privileged documents from law firms, where that is required for regulatory purposes? Will the Government ensure that the FCA uses the enforcement powers in relation to professional services firms that it currently employs in relation to financial services firms? The threat of robust enforcement is always an effective deterrent to bad behaviour.
Finally, I am concerned that this excellent proposal will take time to implement, and I am worried about how effective supervision will be maintained during this period of transition. Will the Minister say what he proposes to do to ensure that the supervision of professionals is as robust as possible? I suggest that he gives OPBAS the power of public censure, so that it can name and shame those companies that deliberately fail to abide by the AML regulations, and the power to levy fines against supervisory bodies that fail to fulfil their obligations to remove supervisory responsibilities from those who fail to fulfil their duties. Will he consider creating a duty to ensure that the existing bodies co-operate with the FCA during the transition?
I welcome the proposal. I look forward to working with the Government to strengthen its effectiveness and to protect the supervision of professionals during the transition to the new scheme.
Lord Eatwell (Lab)
My Lords, I begin by drawing attention to my interests listed in the register. The financial crisis of 2007 to 2009 left lasting scars on the UK financial system. The costs of that crisis have reverberated in the form of embedded risk aversion, particularly among financial services regulators.
Yet, risk aversion has its uses. Since the 2009 crisis, the financial services industry has been battered by further successive crises: Brexit, Covid and the wars in Ukraine and the Middle East. It is to the credit of the Bank of England and the financial services regulators that the industry has displayed a remarkable level of financial stability throughout these storms.
Yet there remains a persistent dissatisfaction with the performance of the regulators. The costs of compliance are excessive. A PwC study puts the sector’s annual compliance bill at nearly £35 billion—roughly 13% of total operating costs. Regulators are said to take excessive time over crucial decisions, such as authorisations. There is no consistent cost-benefit analysis of regulatory measures, despite the fact that the 2023 FSMA required the FCA and the PRA to establish cost-benefit panels. Regulatory decisions often create uncertainty, stifling innovation and discouraging investment.
The fact that the Bill addresses some of these concerns is certainly to be welcomed. The simplification of the senior managers regime and other administrative requirements should reduce costs. The new provisional licences should speed up effective authorisation. The changes to the relationship between the FOS and the FCA will perhaps reduce regulatory uncertainty, although it may have other effects, as the noble Lord, Lord Sharkey, suggested. Moreover, the increased flexibility provided to the FCA and the PRA in several sections of the Bill must be used with care, lest flexibility generates uncertainty.
While I welcome these measures, I am concerned by the changes to ring-fencing. The claim in the Explanatory Notes that,
“updating the statutory framework underpinning the ring-fencing regime as part of a wider programme of ring-fencing reforms”,
sets alarm bells ringing. Updating may well be the origin of increased systemic risk. The protection of activities within the ring-fence must be a primary objective. Weakening the ring-fence in the name of financial innovation would be unacceptable.
Moreover, the claim that:
“These reforms will unlock more finance for the UK economy”,
sets alarm bells ringing even louder. When he sums up, could the Minister enlighten us about the content of the,
“wider programme of ring-fencing reforms”?
What exactly do the Government have in mind?
The Explanatory Notes claim that Bill,
“modernises how the financial services sector is regulated, supporting it to grow and to lend more to businesses”,
but overall, the Bill gives the impression of tidying up, rather than embedding greater financial commitment to investment and growth. Of course, the emphasis on investment and growth is surely correct. It is necessary for the economic well-being of the people of this country. In this vital respect, for many years the financial services industry has failed, and it is continuing to fail.
Since 2000, the share of financial services in GDP has grown by 50% from 6% to 9% of GDP. Over the same period, the share of investment in GDP has not grown at all and, indeed, has tended to decline and has been persistently lower than in other major industrial countries.
We have to reflect on the fact that the prosperity of the UK’s financial services sector is not solely a success of private enterprise; it is a success of a particular institutional framework in which public authorities and the market are deeply intertwined. The prosperity of the City of London depends upon the global prestige of English law and the public institutions that enforce it. Similarly, financial services depend on the public provision of a stable monetary framework and a respected code of financial regulation, ranging from the role of the Bank of England as lender of last resort and guardian of systemic stability to consumer protection and the prevention of financial crime.
Public provision defines the environment within which financial services prosper. In return, financial services should work in a way that serves society by funding the investment in innovation, productive capacity, research and skills that the country needs. That is the settlement between the public realm and financial services.
That settlement is not working. A new settlement is required but what might that look like? It should begin with a framework of financial institutions that are committed to the needed investment. I do not mean greater flows of funds into stocks, shares and bonds in secondary markets. Britain needs financial institutions that fund real investment, new research, new products and services, new infrastructure, new homes, new international competitive industries. The Government have made an attempt at this by creating the National Wealth Fund. However, that fund will invest only if a firm that seeks funds from it has already acquired private sector funding. In other words, an institution that exists because private markets have failed defers to those failing markets to guide its own investment decisions. That is just not good enough. The new settlement must not rely solely on government, regulators or even politicians. The financial services industry itself must play its part, building on current initiatives such as the Capital Markets Industry Taskforce, convened by the London Stock Exchange.
The Bill before us is not part of this new settlement to which I refer. It is worth while and sensible, but the task of building a financial services industry that truly serves our society needs to go a lot further.
Baroness Noakes (Con)
My Lords, I declare my interests in that I hold shares in a number of listed financial services companies. It is a pleasure to follow the noble Lord, Lord Eatwell, who is one of the select group of noble Lords who regularly take part in the scrutiny of financial services legislation. I welcome the Minister to our club.
There is much in this Bill which is good. I welcome clauses dealing with the SMCR regime, how the FOS works and the transformer and insurance vehicles. In addition, the changes to ring-fencing are positive, but they do not go far enough to roll back this burdensome regime which cost billions to implement and run and is so flawed that not a single other country has adopted it.
There are, however, several areas of the Bill which I shall be looking to improve in Committee. I will focus my remarks today on just one area: Clause 17. Currently, the PRA and the FCA must have regard to the regulatory principles in Section 3B of FSMA in everything that they do. Clause 17 downgrades this, so that the principles are rendered impotent. If Clause 17 becomes law, the regulators will merely have to talk about the principles in the new five-year strategies that are required by Clause 16.
The regulatory principles were certainly due an overhaul. However, neutering them is a shockingly bad decision by the Government. It is not surprising that many in the financial services sector have criticised it. I will frame my remarks around the regulatory principle of proportionality, though what I say also applies to other elements of the principles. Proportionality requires burdens imposed to be proportionate to the benefits that are expected to result. This manifestly should be uppermost in the mind of the FCA and the PRA when they are designing new regulatory burdens or updating existing ones. The lack of proportionality in how the regulators currently operate is one of the key criticisms made by financial services firms. I do not doubt that the proportionality principle is relevant when the regulators develop their long-term strategies. Strategies, however, tend to be high-level abstractions; they are not blueprints for how regulation works in practice. It is the detail of the rules and guidance, rather than strategic statements, that determines how regulation impacts the financial services sector.
The effect of Clause 17 is that the regulators no longer must consider how the detailed rules and guidance work in practice for the various firms that they regulate from a proportionality perspective. The regulators will be entitled to ignore representations about proportionality made during consultations. This downgrading not only directly affects how firms can engage with the regulators when rules or guidance are developed but impacts the accountability of the regulators, which is already problematic.
The regulators like to say that they are accountable both to the Treasury and Parliament. I have not yet found an example of how the Treasury has held the regulators to account. Focusing on strategic plans will not be enough. The regulators are masters of the art of wordsmithing documents to make them attack-proof. Parliamentary Select Committees try to grapple with holding the regulators to account, but it is an uphill battle—and this Bill makes that battle harder. The root of the problem is the FSMA model. As the noble Lord, Lord Burns, explained, under this model Parliament decides the principles of regulation and the regulators are left to get on with the detail of regulation. That worked well while we were in the EU. The quasi-democratic processes of the EU Parliament—in which the noble Baroness, Lady Bowles of Berkhamsted, played such a central role—meant that there was significant oversight of new directives and regulations.
Post Brexit, the previous Government decided to continue with the FSMA model when the huge body of retained EU law was repealed and replaced, so massive areas are now wholly delegated to the regulators. That is what the Financial Services and Markets Act 2023 enabled. It exposed a large accountability deficit. In partial mitigation, the 2023 Act ensured that the regulators’ consultations had to be sent to the Select Committees of each House of Parliament. That Act also paved the way for the creation of the Financial Services Regulation Committee in your Lordships’ House, which I currently chair.
Clause 17 not only excuses the regulators from having regard to the regulatory principles but repeals the need for the regulators to explain to the parliamentary committees how the regulatory principles apply to their draft regulations. This is a naked attempt to neutralise the work of the Select Committees of Parliament in holding the regulators to account. The FSMA model is a bureaucrats’ and politicians’ dream come true. The Treasury can always point to the regulators if something goes wrong—and the regulators are largely unaccountable. We must use this Bill to make the accountability of the regulators stronger and not, as it currently is, weaker. There will be much to discuss in Committee.
Baroness Bi (Lab)
My Lords, it is a pleasure to take part in this debate and to follow the remarks of the noble Baroness, Lady Noakes. I declare my interest as chair of Norton Rose Fulbright, a law firm.
I thank my noble friend the Minister for his comprehensive introduction to this Bill. The Bill contains an important balance of protections for consumers, from widening the scope of the common bond for credit unions to ensuring access to in-person banking services, while responding to the needs of the financial services industry. As your Lordships know, the financial services sector is important to the nation, domestically and globally. It provides well-paid jobs across the country and supports our international standing, since the UK is the largest net exporter of financial services. It is therefore important that we have a regulatory regime that is agile and proportionate. Many of us believe that the current burden of regulation is too high, with delays in costs affecting growth and competitiveness.
The Bill implements measures that the financial services industry has been calling for. I particularly welcome the changes to the senior managers and certification regime, as these will reduce administrative burdens on business and allow it to operate more efficiently. I am very glad to see the repeal of the conduct rules as proposed in Clause 35, as they are heavy-handed and do not reflect the approach adopted by many of our competitive markets.
The changes to the senior managers regime will, I hope, address the absurd situation I have seen of senior people who are running their firms in EU capitals moving to London and having to wait for many months before they are able to perform the same role in London pending FCA approval. Similarly, the temporary permission regime under Part 4A of FSMA is a welcome and pragmatic regulatory innovation that allows start-up and early-stage businesses to conduct regulated activities while they meet the threshold conditions.
It has been nearly two decades since the global financial crisis, and it is right that the Bill is updating the statutory framework underpinning ring-fencing to reflect the reality that banks are much better capitalised now compared with 2008 and we also have the resolution framework. Today, there are greater concerns about the systemic risk created by the growth of private credit and the valuations underlying it than concerns about retail banks. An indication of how much the broader financial marketplace has changed since 2008 and where consumers may be exposed is suggested by the FCA’s research in 2024, which found that 7 million UK adults, 12% of the population, owned crypto assets compared with just 9.3 million—17%—who owned a stocks and shares ISA. We cannot keep looking back when the world before us is so radically different.
There is much else in the Bill that is to be applauded, including the Financial Ombudsman Service reforms and the abolition of the Payment Systems Regulator with the transfer of its functions to the FCA. That has been welcomed by the PSR itself as,
“a pragmatic next step in simplifying and clarifying payments regulations”,
and is a rare example of reducing the number of regulators rather than merely increasing them.
However, I would like to indicate three areas where I suggest enhanced scrutiny as the Bill is considered in more detail. First, I really hesitate to disagree with my noble friend Lady Hodge of Barking, who highlights the scourge of economic crime, but I am not at all persuaded that Clause 14 will have the desired effect that she is looking for by giving the FCA supervisory responsibilities for anti-money laundering and counterterrorist financing for professional services. I can see why the Treasury thinks it would be tidier for the FCA to be the single supervisor in the place of 22 professional supervisory bodies, but if I apply this to law firms, which are currently supervised by the Solicitors Regulation Authority, which is a regulator and not an advocacy body, the outcome will be that we will simply have another regulator to answer to, in addition to the 15 we currently have, and one that has no experience of supervising professional services firms, let alone law firms.
I can assure your Lordships that solicitors are not currently an underregulated profession, and it is not a lack of regulation that contributes to financial crime. I suggest that where crimes are being committed, the law is enforced, and where schemes exist that are not currently illegal, they are made so. The fact that the FCA has no experience of professional services firms and will need to develop its expertise is reflected in Clause 48, which provides for additional funding for the FCA, exceeding £2.7 million a year for more than two years to,
“cover costs incurred as a result of the preparatory work for the expansion of the FCA’s AML/CTF supervisory responsibilities”.
May I suggest that we use this money to support legal aid instead, which is sorely needed?
Professional services firms are part of the ecosystem which makes the City so successful, and the likely lack of clarity, which may persist for some time as the FCA takes responsibility for a sector it is unfamiliar with, is likely to add to increased compliance costs and delay, which the Bill is seeking to diminish. I know the Law Society is extremely concerned about this proposal and has raised important issues about how legal professional privilege, client confidentiality and duties to the court will be protected, which will need to be addressed if Clause 14 is to apply to law firms.
Secondly, I am concerned about the extent to which Henry VIII powers are relied on in the Bill generally and suggest that we look carefully at the extent to which this is necessary in each case. One of the biggest concerns of business will be uncertainty while we wait for clarity about what new provisions will be introduced. There are, of course, broader concerns about parliamentary oversight with which I have sympathy. I understand that regulation needs to be agile in a fast-changing world and see the necessity, for example, in Clauses 46 and 47, of introducing a broad power allowing the seizure and forfeiture regime to evolve as technology and language develop to prevent criminals using crypto assets for illicit purposes, but I query whether this approach is needed in every case in which it has been proposed.
Finally, I believe there will also be concerns about whether the FCA has the capacity to take on all these additional roles and responsibilities at a time when it is under pressure to respond to the second competitiveness objective. I note that the FCA is receiving extra funding for taking on AML/CTF responsibilities for professional services firms, but I have not seen additional funding for the many other duties that the Bill will transfer to it.
As we have seen from a number of reports, not least from the Growing pains: Clarity and Culture Change Required report produced by the Financial Services Regulation Committee that has already been referred to, and the No Time to Lose: Reasserting UK Leadership in Financial and Related Professional Services report produced by PwC, there is a strong sense in our professional and services sector that it is currently overregulated and subject to compliance costs and delays that negatively impact its competitiveness. This Bill makes a start in addressing those concerns, so I welcome it, and I look forward to engaging constructively in the debate as it progresses through your Lordships’ House.
Baroness Hayman (CB)
My Lords, unlike many noble Lords who will contribute to today’s debate, I have no direct experience of working in the financial services sector, although I suspect I might even apply for associate membership of the club of Members of your Lordships’ House who take part in this legislation that was mentioned by the noble Baroness, Lady Noakes. Like pretty well everyone in the country, I have had experience, not always happy experience, of being a customer of the financial services industry, sometimes because of my status as a politically exposed person, which seems to bleed into my daughters-in-law and all sorts of people, and sometimes simply wrestling with the challenges of communication and relationships with banks, insurers and others.
However, I have experience as a regulator, not in this area but in relation to health. Initially—this was decades ago—in the approval of clinical trials and then in the setting up of the Human Tissue Authority, which I chaired. I also sat on the Human Fertilisation and Embryology Authority and was for six years a member of the General Medical Council. Those experiences have made me a firm believer that clear, effective and proportionate regulation can not only protect patients and consumers but protect those who deliver those services and who are committed to their growth and their success.
The Bill gives us the opportunity to take stock of whether the current frameworks are protecting consumers and properly supporting the smooth functioning of our financial services industry, ensuring that it will remain attractive and able to continue growing and contributing positively well into the future. So, it will be a matter of finding the correct balance, as it so often is on so many issues in your Lordships’ House.
The area that I want to explore today is the sector’s ability to prepare for and respond to the systemic impacts of climate change and nature loss. We took a similar approach in the previous Financial Services and Markets Act 2023, which introduced important regulatory principles that aligned governance of the UK financial services sector with the UK’s climate and environmental goals. The challenges those provisions sought to address do not follow national borders, and the threats they pose are no longer distant or hypothetical concerns but are impacting actors within the financial system now.
The Climate Change Committee and the Bank of England both warn that these types of risks can have tipping points, which could have serious implications for the UK’s financial stability, our ability to avoid or manage sudden shocks to the market, and long-term economic resilience. Some aspects of the financial ecosystem are particularly vulnerable. For instance, we are already seeing the effects on the insurance markets of drought, flooding, coastal erosion from sea level rises and extreme weather. We have seen the problems that arise from that for mortgage lending, affordability for homeowners, and infrastructure and supply chains in the UK and globally. According to the Swiss Re Institute, the global “protection gap” between insured and uninsured losses from natural catastrophes rose to an estimated $424 billion in 2025, up $29 billion from 2024, with wildfires and flooding accounting for more than 50% of the increase.
However, there is anxiety that, within the Bill’s objectives to drive growth and increase competition and innovation for financial services, the proposed new system does not account for the risks faced right now, and that the solutions to adapt to them, which are then not put in place, have the potential to undermine the Government’s goals.
One area where progress is urgently needed is on the Government’s stated intention to deliver their manifesto pledge to mandate UK-related financial institutions, including banks, pension funds, insurers and FTSE 100 companies, in order to develop and implement transition plans in line with the Paris Agreement. There was a consultation last summer, but we have not seen any plans and can ill afford further delay. The Taskforce on Nature-related Financial Disclosures—a global voluntary framework designed to help businesses and financial institutions assess, report and act on their nature dependencies and impacts—also remains only voluntary, in contrast to the requirements for some funds under the Task Force on Climate-related Financial Disclosures, so it would be helpful to understand what steps the Government are taking to expand coverage and adoption of the TNFD.
Then, of course, there is the concern raised by the noble Baroness, Lady Noakes: that it appears that the FCA and PRA will no longer be required to have regard to some of their regulatory principles, including climate and environment obligations, in their day-to-day functioning and will instead be asked to set out how they are adhering to them in strategy documents. There is a concern that this could water down a useful and necessary steer, at a point where we need to be asking regulators to do all they can to safeguard financial services’ preparedness to deal with and adapt to climate change. I look forward to debating Clause 17 in some detail.
Finally, I and many others were encouraged by the Government’s previous commitment to bring forward statutory guidance that will offer pension schemes clarity on how they consider investments for savers in relation to systemic risks such as climate change. I would be grateful if the Minister reassured me that schemes will not have to wait too long to see the detail on when and how these plans will be brought forward. I close by stressing that the Bill is about making sure that the financial sector can capitalise on all the economic and investment opportunities at hand. That includes adapting to the impacts of climate change, which are already being felt.
Lord Pitt-Watson (Lab)
My Lords, my professional background before I joined the House was as a finance practitioner. I still work pro bono with consumer organisations, including some who have a view on the Bill. Most relevant to what I will say is that I am a fellow at Cambridge, where I teach a course focused on how we create a purposeful finance industry that, like all good market institutions, prospers when it serves the outside world.
To help build such a purposeful industry should be the goal of this legislation. It is a profoundly important goal, partly because, as the noble Baroness, Lady Neville-Rolfe, said, this is the jewel in the UK’s economic crown. But it is more than that: we need a successful finance industry if we are going to solve the critical problems of the country and the world: growth, prosperity, looking after people in old age and, as the noble Baroness, Lady Hayman, was saying, addressing the growing climate challenge.
There is no successful finance industry without effective regulation. However, as the House of Lords Financial Services Regulation Committee noted, we do not have a blueprint for what the best regulation looks like, and we have made big mistakes in the past. The global financial crisis took place despite the then existing regulation; some might even argue that, in some ways, it happened because of the nature of that regulation.
I wonder whether the whole House might agree on a starting point: that we are trying to get a finance industry that will fulfil its purpose well in serving the outside world. That means keeping our money safe, helping us transact, allowing us to share risk, and, critically, allowing us to take our money from point A, where it is, to point B, where it is needed and can create growth and prosperity. But for that to happen, we need an industry that is trustworthy and trusted to carry out these purposes. Otherwise, people will not save or borrow.
That all seems pretty straightforward, but there is a problem which we should recognise. People do not express trust in the finance industry. According to FCA surveys, in 2024 only 36% of people felt that
“most financial firms are honest and transparent in the way they treat them”;
27% felt the opposite. Some years ago, the Bank of England asked British people to find one word to describe the finance industry. Do noble Lords know which word they chose? It was “corrupt”. The finance industry accounts for about 9% of GDP—the figure from the Minister was 8%, and 12% from the opposition Benches—and it is responsible for 42% of corporate fines that have been issued. The Local Government Ombudsman gets 22,000 complaints a year; the Financial Ombudsman gets 216,000. I could go on and on. This issue needs to be resolved.
Malfeasance is not the most concerning issue; it is productivity. On the best academic evidence we have, there is little evidence that the cost of getting money from point A to point B has fallen by very much, even over 100 years. No other major industry has such a poor productivity record over such a period. At the same time, 1.3 million British people do not have a bank account. According to the FT a couple of weeks ago, British bank lending to SMEs is the lowest percentage of GDP it has been this century. There are big gaps in our finance system.
These problems occur despite, or maybe even because of, the great amount of regulation we have. Robin Ellison was a pensions partner in one of the big law firms and has now retired. He reckoned that, in 1990, we had 3,000 pages of pensions regulation; a couple of years back, it had risen to 165,000.
We must be sure that we are not encouraging a world where finance practitioners spend their time thinking about how to get around the regulation. It is euphemistically called regulatory arbitrage, and it creates a game of whack-a-mole: there is a rule, and someone finds their way around it; we whack that, and they find their way around it again—and we end up with a burdensome and expanding rule book. As the noble Lord, Lord Eatwell, said, we need a new settlement.
But in that settlement, regulation is just one piece of the ecosystem. There are also institutions, markets, incentives, ethics, professionalism and technologies, all of which are changing rapidly day to day. Getting the regulation right means that it needs to fit into this much larger system. I would have that as a background—a background on which I hope we might agree—and I think that has implications.
I applaud many parts of the Bill—for example, the encouragement of credit unions and thinking about how we can get credit to the people who need it fairly—but one concern, which it might be helpful to clarify, is that as we change the rules by which the Financial Ombudsman Service adjudicates, we need, as the noble Lord, Lord Burns said, to keep them principles based. Why is that? Because these are dynamic markets and we are trying to minimise regulatory arbitrage. Maybe it could be made clear from the outset that, when reference is made to the Financial Ombudsman Service adjudicating only on breaches of the FCA rules, those rules include the principles of business and the code of conduct.
There are many other comments that one might make, but I think they are best addressed in Committee. For now, my key point is that in any effective market economy, success should be contingent on serving customers well. There is a deficit of trust in the financial services industry. Regulation should align consumer, producer and society. My broader point for this House is that, in debating the Bill, it might be helpful to express a consensus, shared with industry and with consumer groups, that we want a finance industry that is there effectively to fulfil its proper purposes to the world. I look forward to our coming discussions.
Baroness Bowles of Berkhamsted (LD)
My Lords, I declare my interests as a director of Valloop Impact Captive.
The Bill is a chunky addition to the impenetrable forest of financial services legislation, relocating key issues into the even larger forest of regulator rules. Who is it for? It cannot be only for business; it must also be for people, and that is how I will interrogate it. How are people affected when primary legislation is repealed and their rights are transferred to regulators? How will they feel when their MP says, “It’s out of the hands of Parliament, in fact it is often out of the hands of the Treasury and out of the hands of the courts”. That is what Clauses 1 and 17 do.
Fair for people means anchored in law, not left to discretion, not left to drift and not left to five-year strategies. Which? warns that the Bill removes vital protections without clarity on how or whether they will be replaced. Uncertainty for people is also uncertainty for business. While I understand well the pressures on firms and regulators to achieve more certainty over long-tail risks, that cannot justify Parliament removing statutory rights before we know what will replace them.
I share the aim for growth, investment and competitiveness, but growth cannot be built on taking advantage of people. Stripping primary legislation of fundamental protections—both rights and remedies—replacing them with yet-to-be-seen secondary legislation and removing Parliament from its past and future influence is not the route to stable, responsible growth. Three areas illustrate this: consumer credit; access to banking; and the removal of the “have regard” principles.
On consumer credit, the unfair relationship provisions, Section 75, unenforceability rules and protections for vulnerable borrowers are core statutory rights and remedies, not conveniences. The FCA’s conflicting provisions on motor finance, where it originally said there was no need to disclose commission arrangements unless asked, shows that the legislative line set by Parliament was not followed. The FCA did not get that right—will it get it right in future? Before the Consumer Credit Act is hollowed out, will the Government define in the Bill a core of statutory protections—the rights and the associated remedies that make those rights effective—that will remain in primary legislation?
Clause 3, on access to banking, raises a fundamental question about the balance between consultation, ministerial discretion and parliamentary scrutiny. The Government want to consult on access to banking services and then implement the outcome through regulations that amend primary legislation, including with FCA rules as they change over time. Parliament’s role becomes a take-it-or-leave-it vote on an unamendable instrument. Clause 3 could be more tightly framed—for example, linking it expressly to matters already consulted on or by avoiding automatic changes to the law when FCA rules are updated. Access to banking is vital. Members of the other place will not want to tell their constituents, “We have no influence”.
The consistent pattern is that this Government want to do without Parliament in future and eradicate its past. The next eradication of Parliament’s voice is the removal of the “have regard” principles that anchor regulators to law, proportionality and Parliament’s intent. In practice, regulators trivialised them. Then, in their consultation response, they said that these duties were burdensome. The Government did their bidding, removing them from operational decision-making and, fundamentally, the basis on which courts can test that delivery.
Administrative inconvenience is not a constitutional principle. If the issue is frequent or laboured reasoning, that can be solved without removing the duties. British Steel pensions showed why the “have regard” principles must stay. The FCA had full perimeter responsibility, yet the principles—vulnerability, transparency and proportionality—were treated as a box-ticking exercise. Parliament had to drag the issue into the open before the regulator acted. The answer is not to remove the principles on which we were able to drag but to insist that they are applied properly.
Dame Elizabeth Gloster’s report into LCF found the same pattern. The FCA failed to apply the statutory principles that Parliament had set, treated them as peripheral and did not understand the framework in which they were meant to operate. Its response was mechanistic “have regard” tables, which was defensive paperwork, not culture change. If anything, that shows why these duties must remain in law, be effective and not be removed at the regulator’s request.
Before anybody says that the consumer duty does it all, it does not. It does not replace statutory duties or bind the regulator in any way that Parliament can, and it certainly does not give courts the tools they need to test regulatory decisions. It is an FCA rule, changeable by the FCA, not a fair substitute for a statutory duty.
Proportionality, transparency and respect for the size and nature of firms must apply to regulators’ rule-making and operational decisions, not be pushed to high-level strategy with no legal bite. The same is very much true for addressing climate change.
This is not just the view of consumer groups. TheCityUK warns that Clauses 16 to 18 weaken Parliament’s ability to hold regulators to account. The London Market Group is equally clear that downgrading proportionality is a step backwards. When consumer groups, industry and parliamentarians all say the same thing, the Government should listen. I do not know how the Treasury has been suckered into suggesting that this is merely administrative, but I am not buying it. These are protections for people—the fiduciary bargain.
To conclude, this Bill has ambition but it removes safeguards, hands too much to regulators, disfranchises Parliament and leaves people without rights and without the remedies that make those rights enforceable and effective, grounded in law. That same uncertainty hurts responsible business, and I will submit amendments on which I hope we can work together.
Lord Davies of Brixton (Lab)
There is a thought experiment, a century old, that I think should be made compulsory for every financial regulator, every market reformer and, frankly, every politician who has uttered the word “modernisation”. It comes from GK Chesterton, writing in 1929. He is writing about why he was a Catholic, but he makes a critical point that applies more generally. Imagine you come across a fence in the road and cannot immediately see why it is there. The modern, progressive, efficient temptation is to conclude that because you cannot see the purpose, there is no purpose, and to tear it down. Chesterton’s counterpoint is simple and devastating: do not touch it until you understand why it was put there, because someone at some point thought hard enough about this road to put a fence on it. Only when you know why are you entitled to remove it. This is Chesterton’s fence and I hope people will understand its relevance to this Bill.
The timeline of financial markets is littered with wreckage where it was decided that a fence was no longer required. We have experienced a cycle of financial disaster, followed by stronger regulation, followed by the growth of complacency, followed by demands to remove restrictions on markets, followed by injudicious deregulation, followed by yet another disaster. We are seeing this playing out in real time with, appropriately enough, ring-fencing. After 2008, the Vickers commission recommended that retail banking be ring-fenced from investment banking, rebuilding in modified form something close to the fence that had existed back before big bang in 1986. But within a decade, within living memory, pressure has built to weaken the rule. The fence looks costly and complicated. The arguments are familiar: the fence is inefficient and other jurisdictions do not have it, affecting our competitive position and putting London at a disadvantage.
These are precisely the arguments that preceded the events of 2008. The fence was built because we had just watched what happens without it. Now we have this Bill, and I am pleased to see that the Government are not unaware of the need to maintain consumer protection. The Explanatory Notes state the need to make changes
“without compromising on core consumer, prudential and market protections”.
They also state the aim of
“ensuring that consumers continue to have access to effective redress”.
I thank my noble friend the Minister for his clear statement in introducing this Bill, in reply to questions asked by me and other Members, that consumer rights will be protected. Nevertheless, while I trust my noble friend, our aim during the passage of the Bill will be to verify that these aims are achieved.
We must all be concerned, therefore, that not everything in this Bill has been welcomed by organisations representing consumers, not least the Consumers’ Association itself. Given its record of defending consumer rights, it is worth highlighting some of its concerns.
First, there are the changes to the Financial Ombudsman Service that will restrict consumers’ access to timely redress. To my mind, the proposals too closely mirror what the industry has proposed without providing the adequate supporting evidence to move in that direction. The Treasury’s own assessment of the FOS is that it functions well in the majority of cases. This is a poor basis for such a fundamental reform. Secondly, the Consumers’ Association has concerns that the Bill removes enforcement sanctions under the Consumer Credit Act 1974 without introducing equivalent replacements and shifts other protections from statute into Financial Conduct Authority rules, which have not yet received any consultation. A third problem is the new 10-year time limit on FOS complaints. It is totally unsuited to financial products, a large proportion of which are long term, typical of mortgages, life insurance and pensions. The concerns of the Consumers’ Association are far from trivial and will have to be addressed in Committee. I look forward to the debates.
The Government have been clear that the legislation is driven by an economic argument to foster growth in our world-leading financial sector, but there is also a compelling case, made clearly by my noble friend Lord Pitt-Watson, that effective consumer protection has an economic rationale as well. It is a sector that requires consumer confidence and trust. Financial services are unlike other markets: products are complex, time horizons are long, and the information gap between the provider and the consumer is substantial. In those circumstances, consumer protection is not an impediment to a well-functioning market but a key to that market functioning properly. Remove the fence without checking why it is there, and the likely result is not greater efficiency but the familiar cycle of mis-selling, scandal and declining consumer engagement with the very products that are supposed to serve their financial interests. A reform agenda framed around growth should therefore be cautious about weakening conditions that make sustainable growth in financial services possible.
Lord Kamall (Con)
My Lords, I thank the Minister for his recent letter and the meeting he convened last week, but also for clearly laying out the ambitions for this financial services Bill. For many years, I sat on the Committee on Economic and Monetary Affairs of the European Parliament and worked closely with the noble Baroness, Lady Bowles. I also see the noble Baroness, Lady Gill. We worked on money market funds together. On that committee, we scrutinised a slew of regulation following the 2007 to 2008 financial crisis.
In each case, I asked four questions. First, do we need this legislation, given how much regulation we already have? What problem are we trying to solve? Are we just regulating to be seen to be doing something? Secondly, if a bank or other financial institution failed tomorrow, how do we make sure it would not be bailed out with taxpayers’ money? Thirdly, who takes responsibility for failure? We debated the merits of director liability and whether this would encourage directors to take more interest in what is on their banks’ balance sheets. Fourthly, how do we make sure, when it comes to complex financial instruments on balance sheets, that while banks might be willing to book the income up front, they make sufficient provision for potential losses, just as we saw with financial instruments such as CDOs and CDSs in the run-up to the financial crisis?
As others have said, it is nearly 20 years since the last crisis, but we should remember that, after each crisis, there is a temptation to regulate for the previous one. Then, after a while, there are calls to loosen rules, to increase liquidity or access to credit, which in turn raises concerns about whether this could contribute to the next crisis. With this Bill, I welcome the ambition to reduce complexity and inflexibility, to simplify what has become a complicated consumer credit regime, and to streamline regulations and reduce the number of overlapping regulators. Like my noble friend Lady Noakes, however, I remain concerned about regulator accountability. Although I generally support less regulation, I recognise that when things go wrong, quite often the public expect politicians to do something—just do something. We should remember why measures such as ring-fencing were introduced or, some would argue, reintroduced.
The Explanatory Notes to the Bill say that the benefits of ring-fencing vary across areas and can
“give rise to unintended consequences in practice”.
There is also some concern about the impact on the bank resolution regime. Can the Minister explain what those unintended consequences were and the impact of the reforms on the bank resolution regime?
On the overseas recognition regime, I welcome the Government’s intention to take a different approach to the EU. During my time in the European Parliament, much of the equivalence was driven more by protectionism than resilience, often limiting choice for investors and consumers. On accountability, I welcome reform to the senior managers and certification regime to approve accountability of appointed representatives, but I will also be looking to understand how proportionate or burdensome this requirement would be.
I now come to the area of financial services where I maintain a strong interest: that is, how do we increase access for those who many describe as financially excluded? Both the UK and then the EU brought in legislation to force banks to offer basic bank accounts. That may sound reasonable but, in reality, this was forcing banks to offer accounts to customers who they did not particularly want to serve—I wonder what that means in terms of customer service. An unintended consequence is that this squeezes out potential competition from non-banks, such as credit unions, which would welcome the ability to serve these customers and grow. I welcome the Government’s intention to increase the number of mutuals and co-operatives, and to wider the common bond requirement, but I wonder whether they could go further. Being slightly radical, I ask the Minister: have the Government looked at the feasibility of abolishing the common bond altogether? If so, what concerns were raised? Also, as we see more banking in hubs in response to high street bank branch closures, could we perhaps create a win-win situation where credit unions or CDFIs, which I will discuss later, run those banking hubs? Not only can they serve their customers, but they can earn additional revenue facilitating payments into, or withdrawals from, accounts held with banks.
I am disappointed not to see an explicit reference to microfinance, which in the UK we call community development financial institutions, or CDFIs—non-profit, community-based organisations that offer financial support and credit to individuals and financially excluded entrepreneurs who otherwise might turn to payday lenders. One of the most amazing CDFIs—one that I try to help where I can—is Purple Shoots. It was founded by Karen Davies who, when she worked in financial services in London, realised that entrepreneurs from poorer backgrounds were often being turned down not because of a poor business case, but because of their credit status. She therefore set up Purple Shoots to offer mentoring and loans between £500 and £3000. When it turns down a loan but thinks the idea has merit, it provides wraparound care to get the entrepreneur’s business case into a position where it merits a loan.
The impact has been amazing. When I hosted a parliamentary event for Purple Shoots, we heard from Trevor Palmer who turned up in a complicated electric wheelchair. Partly because of this, he had been written off by mainstream finance. Thanks to advice and a loan from Purple Shoots, he was able to start his enterprise, take himself off benefits and later employ others and take them off benefits. Organisations such as Purple Shoots are driven by both a belief in the spirit of enterprise and a real social purpose.
As Sam Rex-Edwards and Kay Polley from the Finance Innovation Lab said to me, talent, ambition and entrepreneurial potential are spread across the country; access to finance is not. While many larger organisations can access lottery funding, which in turn means they can offer much larger loans, Purple Shoots cannot access these funds to offer much smaller loans, often with a higher social impact. When it applied for lottery funding, it was told to raise their interest rates and, in effect, to lend to fewer entrepreneurs. While anyone who is unable to pay back on time is, quite rightly, counted as a default, and understandably so for mainstream banks, Purple Shoots instead prefers to give them a little more time to repay. For these reasons, it does not tick the right boxes for lottery funding. Although I understand that lottery funding is dealt with by another government department, DCMS, I ask the Minister: given that the Bill does not specifically mention CDFIs, what is the thinking in both departments on how to create the space for CDFIs such as Purple Shoots to grow, for others to enter the market, and to increase access to credit and advice for entrepreneurs from all communities, not only those who have easy access to credit?
Time is limited, so I end by saying that this Bill deserves support where it reduces needless regulations but does not reduce the accountability of regulators, where it strengthens financial resilience but does not reduce proportionality, and where it widens financial inclusion but does not reduce consumer rights.
Baroness MacLeod of Camusdarach (Lab)
My Lords, it is truly humbling to hear from so many noble Lords today with such expertise. As many have said, there is much to commend in this legislation. Any measure that strengthens the financial services in this country is welcome. As was laid out in the Leeds reforms last year, every encouragement should be given to banks or individuals who want to invest in the United Kingdom.
The ambitions of the Scottish financial services industry, a hugely important employer in Scotland—in fact, the biggest—chimes with the Government’s ambitions. It is incredibly important and it hopes that the new legislation will shake up the planning system and reduce red tape for investors. In this legislation, among other measures, emphasis is put on the Government’s support for lending and investment. We hope that the reforms will unlock more finance for UK businesses, and that improved competition in small and medium-sized enterprise lending will help small businesses to access finance.
I will not talk about regulation; I will leave it to the experts among noble Lords. Investment in SMEs, particularly in Scotland, is what I want to talk about today. Basically, it is not happening as it should and I am not exactly sure where this Bill will make the difference that is needed. This is a cri de coeur to the Minister. There are entrepreneurial, far-sighted men and women wanting to start a business, to contribute to their communities, to employ people in the communities, all the time contributing to the UK economy, but there are many obstacles in their way, not least accessing the financial support they often need to confidently take the first steps to create a business. Many areas of Scotland are struggling. Not only are they stranded where Scotland’s ferry system does not function but there is not enough housing and there are too few jobs. There will be even fewer jobs unless SMEs are able to access investment. Throughout Scotland, businesses are struggling to get investment. One of the reasons given is that it is too remote. Perhaps it is time that people in London or Edinburgh think of themselves as remote, rather than those who live beyond a metropolis.
We know that bank lending to British businesses has fallen to its lowest level for many years. Perhaps the banks and other lenders did not read the memo from Leeds but, until they change their behaviour, there will be little chance of stronger economic growth. It may be timely to remind the banks that they owe us: hardly one of them would be standing if it were not for the Labour Government’s Herculean support during the financial crisis of 2008. When bank lending fails, SMEs are disproportionately affected, and banks have pivoted away from SME lending because it can be riskier and less profitable. Banks do not want to invest in start-ups; they only want to help when business is established and any risk has been minimised. Surely it is not unreasonable to suggest that banks could take more responsibility to invest in the country’s most enterprising and entrepreneurial sector. Banks tell you that there is no lack of lending capacity but little demand. It seems that many SMEs are less like likely to apply for credit for fear of rejection, so it becomes a self-reinforcing loop. One senior figure at a UK bank, quoted in the Financial Times recently, said there was no lack of lending capacity:
“All the banks are issuing bold lending targets, but if there is no demand as no one wants to borrow there isn’t a lot we can do”.
I would suggest to that senior banker that they find out what more they can do to get money out the door.
Levels of investment in Scotland are typically lower than in the best-performing countries in the OECD. In areas such as research and development, investment has been chronically low in comparison with the OECD and below the UK average, yet Scottish universities’ contribution to R&D is among the best in the OECD countries.
SMEs form the backbone of the Scottish economy. There are 350,000 of these important companies, employing over 1.3 million people. They are hugely important in farming, retail and hospitality, and increasingly in life sciences and space technology. There is great innovation in AI, digital assets and tokenisation in Scotland, but these modern-day pioneers need investment. According to the business sector, they are underserved and, if they are ever to scale up and contribute meaningfully to our economy and the funding of public services, that needs to change.
Too often, start-ups have had to leave Scotland to seek investment since investment banks, venture capital and private equity no longer have offices in Scotland. The investment community is very heavily centred in London. That is a pity, and a blow to the Scottish economy, as it is to other parts of the UK outside the south-east of England. It is important that Scottish firms connect with London-based investors and that those investors visit Scotland to properly understand its vast potential—and there are huge opportunities, if only they knew about them. Nobody wants to undermine London’s economy, but it is a waste of potential if investment horizons in the UK remain so limited.
There is confusion about the responsibilities of the UK and Scottish Governments. There is a suspicion that too many UK civil servants think that Scotland’s machinery is completely separate from the UK’s, and that needs to be cleared up. The City of London joined forces with No. 11 to set up a single investment portal for the UK, which allows all potential investors to see what opportunities there are. Unfortunately, there has been little take-up in Scotland and it may be that politics are getting in the way, while business north of the border thinks Scottish civil servants may be too many sceptical about anything that comes from London. So I appeal to both Governments to work more closely together to take advantage of any facility that might help.
In conclusion, I have four specific asks for the UK Government, which I hope they can consider, in this legislation. Please set out a clear vision and structure for accessing funds to grow businesses. Please fly the flag for the whole of the UK when talking to overseas investors. Please encourage banks to be more courageous and take risks. Lastly, please tell investors to think beyond London and go to other places from time to time, as they will find opportunities. If the Government can embrace these asks, I am sure that this Bill will feel ever more relevant.
Lord Carlile of Berriew (CB)
My Lords, it is a privilege to speak in a debate with those who have such deep understanding of financial services and markets, including a Minister with transformational business experience, which we all respect. My own experience as a lawyer has been limited in this area largely to providing unwelcome and pessimistic advice in relation to large frauds, some of which have enriched the egregious fraudster to an extent that he—and it is usually a he—has gone on to lead a very successful financial life. This is not good for the reputation of the financial services industry.
In that context I remind your Lordships of something that my profession, the legal profession, does rather successfully and in an increasing amount as part of the informal part of financial regulation. That is the increase in private prosecutions which are used to bring fraudsters to justice. I remind your Lordships who are interested in this rather narrow subject of the successful prosecution in 2018 in what is called the Allseas case, in which the Director of Public Prosecutions at the time had twice refused to prosecute, but that private prosecution was successful.
To turn to the generality of this interesting Bill, I say that financial markets are living instruments, in the most literal meaning of that phrase. When we legislate, there is an imperative to provide flexibility to meet need, rather than waiting for reactive new legislation when something has to be done because it has gone wrong. This is a very important legislative opportunity, in which we have a duty to enact the new law with due anticipation of potential unpredictability—a difficult but important task.
Intrinsic to the Bill is the relationship between Parliament, regulators and the citizen. Over recent decades, we have witnessed a significant shift in the way that financial services are regulated. Increasingly, Parliament has established broad frameworks while regulators are entrusted with responsibility for detailed implementation. There are understandable reasons for this, and in this area, although I am rather against having regulations rather than a main Act provision, I think there is room for quite a lot of regulation so that that living instrument can survive, for technological innovation proceeds at extraordinary speed. Parliament can enable; the regulators are there to provide expertise and experience, which use the statutory foundation to enable proportionate reaction to whatever future challenges may arise.
I turn to three specifics. First, Clause 7 in Part 2 reforms the Financial Ombudsman Service. I support those changes in the round, but I urge the Government to give thought to enhancing them so that entities themselves have the ability to request a referral to the Financial Conduct Authority for advice on rule interpretation, rather than leaving it to the Financial Ombudsman Service on a case-by-case basis. Important principles can arise and it should not take so long to resolve them.
Secondly, I urge that additional attention be paid to authorised push payment fraud. This is a major and egregious fraud for consumers, costing about £450 million in losses annually, mostly to unsophisticated people. I hope that the Bill can be amended to strengthen safeguards to prevent that kind of fraud at source, specifically by requiring online marketplaces to apply know your customer checks to sellers and to have on-platform, traceable payment methods to defeat the cruelty of fraudsters.
Thirdly, there is the important issue of collective actions. Collective actions are funded by litigation funders, who are now part of financial services and recognised as such. I have played some part in collective actions and still do. Sometimes they may involve a dozen claimants; sometimes they involve 10,000 claimants. These are collective actions that give the opportunity for ordinary people to recover damages for frauds committed upon them—some by the financial sector, I am afraid—that they would not otherwise be able to recover from.
Litigation funding has been very damaged, inadvertently, by a Supreme Court case called the PACCAR case. Legislation was introduced in the previous Parliament, with the agreement of all three main parties, to push it through quickly, but the election came and that was not done. I and other noble Lords are happy to discuss with the Minister the PACCAR situation in the hope that it could be dealt with in this Bill, in which I believe it is in scope.
I return to more general matters. Parliament should never lose sight of the distinction between creating rights and administering those rights. The House must therefore carefully examine any provisions that may have the effect of transferring important questions of consumer protection from primary statute into a wood which we cannot see through for the trees. I illustrate this concern through the issue of consumer redress. One of the recurring themes in modern financial services regulation has been the recognition that consumers require effective mechanisms through which to enforce their rights. I have been waiting years to say this, but a right without an effective remedy qualifies as what the eminent jurist Hohfeld strikingly described as a no-right. The Bill should avoid no-rights.
Baroness Morgan of Cotes (Non-Afl)
My Lords, it is a great pleasure to follow such a thoughtful speech from the noble Lord, Lord Carlile, who picked up on a couple of points that I was going to mention. First, I draw the House’s attention to my interests as a non-executive director at Santander UK, a non-executive director at the Financial Services Compensation Scheme, which oversees consumer redress, and as chair of the Advertising Standards Authority, which is a regulator. Because of those interests, I do not normally talk about financial services in this House, but because this is a more general debate at the start of the legislation, I want to assist, I hope, with a couple of factual points and pick up two areas of policy on which the Bill is currently silent—the noble Lord, Lord Carlile, has just picked up one of them. I do not intend to take part in further stages but, depending on the Minister’s answer to the final policy issue I will raise, I may return.
I will start with ring-fencing reform. We have already heard from a number of noble Lords about why reforms were introduced. To keep this on a factual basis, and to give examples of the unintended consequences mentioned by the noble Lord, Lord Kamall, I have two examples of why ring-fencing can be unhelpful to consumers and economic growth. The first example is a travel company offering package trips that wants to mitigate its exposure to increased fuel and foreign exchange costs. It wants to take options on forward fuel or FX costs, but those cannot be offered within the ring-fenced bank that it banks with. Those options can be obtained from another financial institution, but that obviously means extra costs and takes longer, and consumers will ultimately pay those costs.
The second example is a UK energy company looking for investment. The ring-fence rules, as currently drafted, mean that lending to the holding company is not permitted, so lending must go to a subsidiary on a strict reading of the rules. Is that really what was intended? Are we serious about bringing down the cost of doing business in the energy sector, a sector that has very real resonance for households, as well as a link to national energy security?
Moving on to reform of the Financial Ombudsman Service, we have heard in the speeches from two noble Lords the significant strength of feeling on these proposed reforms among consumer groups. I will just say two things here. First, predictability of law and regulation is an important principle of doing business in the United Kingdom and is something that businesses want to see. Secondly, in the speeches I have heard so far about reform of the Financial Ombudsman Service, I have not heard anything about the actions taken or the way that certain claims management companies’ business models are based on bringing cases to the ombudsman. The Financial Ombudsman Service performs an incredibly important role, and financial institutions should be held accountable when they get it wrong for customers, but we should not lose sight of claims management companies making money from customers who do not need to use their services when they are looking for financial redress.
I now turn to one area—the noble Lord, Lord Carlile, mentioned it—about which the ombudsman has received, and rightly upheld, many complaints: fraud. In November 2022, I had the privilege of overseeing the publication of a House of Lords inquiry report entitled Fighting Fraud: Breaking the Chain, in which we said:
“80% of reported frauds are cyber-enabled”.
According to the Crime Survey for England and Wales, in the year ending June 2025, there were an estimated 4.1 million fraud incidents, a 14% increase compared with the figures for 2024. Out of those 4.1 million incidents, around 3 million involved a loss, and in 2.2 million cases, victims said they were fully reimbursed.
The reason I mention fraud is because the Bill does not contain anything about it affecting the financial services sector. I hope that the Treasury is not leaving it to the Home Office to lead on this. Fraud is not a victimless crime. As we have already heard, the role of online platforms and marketplaces is very important, and romance fraud is hugely costly to victims, both financially and personally. We heard earlier about the changes to the senior managers and certification regime. While I understand them in the context of this Bill, frankly, I would extend the senior managers and certification regime to the bosses of the tech companies to make them accountable for what is happening on their platforms. Since 2022, the world has moved on, and there is now the issue of deepfakes in relation to fraud. Today, I heard about ChatGPT recommending fake websites, which are costing their victims huge amounts of money. I am sorry that the Bill is silent on such an important issue for financial services.
I move on to the final policy area that I hope the Minister might say something about: economic abuse. This is a devastating form of domestic abuse used by abusive partners or ex-partners to control a victim survivor’s money and economic resources. It includes the routine misuse of financial products and services, such as a bank account, a mortgage or credit. Some 4.2 million UK women experienced economic abuse in the past year alone, leaving them carrying debts coerced in their name and trapped with abusers in joint financial products long after separation, while their credit scores are tarnished by the abuse, leading to immediate and long-term financial exclusion. A staggering 750,000 UK women experience economic abuse through the joint mortgage they share with an abusive partner or ex-partner. Perpetrators will routinely use these ties to coerce and control survivors long after separation, leaving their victim survivors facing arrears, repossession, credit destruction and even homelessness.
Financial services firms’ contractual obligations to both parties, through the concept of joint and several liability, limit the steps those institutions can take to prevent these harms through joint mortgages. It is clear that urgent legislative reform is necessary to address this. I welcome the Government’s financial inclusion and violence against women and girls strategies. Both make significant commitments to tackle economic abuse and ensure consistent responses from financial services to support victim survivors.
How will the Government ensure that the Bill’s implementation effectively supports good outcomes for economic abuse victim survivors as vulnerable customers? Will the Minister’s department use this Bill to remove the legislative barriers that still prevent financial services institutions safeguarding victim survivors against the harms caused through joint mortgage abuse? I fully agree with the comment that the Minister made at the beginning of this debate that this whole Bill is a question of balance. I look forward to hearing in the forthcoming debates how that balance is resolved.
Baroness Gill (Lab)
My Lords, as many have already highlighted, the financial services sector remains an absolute engine of the British economy. It contributes roughly £290 billion, or roughly 11% of the total UK economic output, with productivity at 2.6 times the national average. To maintain this competitive edge, our regulatory framework must prioritise nimble execution while reinforcing structural accountability. The Financial Services and Markets Bill is therefore a necessary modernisation of our economic architecture.
Like my noble friend Lady Hodge, I welcome this legislation directly addressing critical pressure points in economic crime and market efficiency. First, it combats financial crime. The expansion of FCA oversight across the legal and accountancy sectors tackles a severe risk channel. Financial institutions currently spend an estimated £38.3 billion annually on financial crime compliance. Unifying oversight directly addresses the structural fragmentation noted by His Majesty’s Treasury, where 25 separate supervisors have historically led to inconsistent enforcement across sectors.
Secondly, the Bill protects the infrastructure. Statutory protection for cash access secures vital banking functions for millions of people who depend on cash and face-to-face banking. Thirdly, it streamlines regulations. Merging the Payment Systems Regulator into the FCA eliminates costly institutional overlap and accelerates decision-making.
I particularly welcome that the Bill is empowering credit unions by reforming the historic “common bond” members’ requirement. This Bill allows credit unions to sustainably scale up and expand their services. Under the old 1979 limits, these rules became a restrictive postcode lottery. For example, a credit union was banned from growing if the population in its geographic area exceeded 3 million—that is most of London. Relatives who did not live under the exact same roof were also barred from joining. By reforming this historic constraint, the Bill drags these rules into the 21st century by raising the membership cap from 3 million to 10 million, by allowing credit unions to expand, merge and scale up, by adding students to the local criteria so younger people can access affordable community borrowing, and by updating family rules so relatives can join, even if they live in different households. As the Government state, the Bill provides a major boost to affordable community finance and directly supports the national goal to double the size of the mutual and co-operative sector.
We have already heard that the Bill also modernises the Financial Ombudsman Service, and I believe that disputes will be resolved faster with much greater operational certainty.
Again, as we have heard from various Members of your Lordships’ House, the proposals will unlock billions of potential lending to small businesses across the country through raising the primary deposit threshold from £25 billion to £35 billion, which would free retail-focused banking groups from overly restrictive ring-fencing rules.
The majority of financial organisations have welcomed this Bill, but there are some concerns. I have been contacted, like others, by UK Finance and TheCityUK, and Parliament’s own Treasury Committee has highlighted that Clauses 16, 17 and 18 are of concern as the balance of power shifts away from necessary democratic checks. It is good to see my friend the noble Lord, Lord Kamall, in his place because he and I, as he alluded to, served on the European Parliament’s Economic and Monetary Affairs Committee together. During the major post-crisis reforms, particularly when we were building the single rulebook, ECON faced these exact structural pressures. We learned the hard way that, when you delegate sweeping powers to independent regulators, you need to hardwire accountability into their operations. We had to fight to ensure that principles like proportionality were not pushed into vague, multi-year strategies but were applied to everyday policy-making. It is that specific, practical experience of balancing regulatory independence with democratic scrutiny that has informed my analysis today.
Referring to some of the clauses, I note that Clause 16 introduces a statutory requirement for the FCA and PRA to introduce long-term strategies at least once every five years. I accept that a long-term road map is incredibly useful for business planning, but markets move fast. A five-year plan can easily become outdated if there is not a required check-in point to adjust the strategy to new economic realities. Can my noble friend the Minister clarify how the Government will guarantee that the regulators formally consult with consumer, business and commercial panels during the development phase? Would a review at the three-year mark overcome this and prevent these road maps from stagnating if no new remit letters are issued?
Clause 17 removes the operational requirement for regulators to consider core statutory principles such as proportionality, transparency and risk-based regulation in their day-to-day functions, moving them exclusively into the five-year strategic loop. However, in March 2025 the Regulation Action Plan explicitly committed to introducing a streamlined, consolidated list of “have regards” via secondary legislation. Can the Minister confirm that the Government will use secondary legislation to establish a rationalised, daily checklist for regulators, ensuring that day-to-day policy-making remains structurally bounded by proportionality?
Finally, Clause 18 removes the obligation for regulators to consult on guidance and minor rule changes, while lifting the requirement to explain routine standard setting of their core objectives. In the financial sector, regulatory guidance serves as de facto rules. Firms alter compliance frameworks and deploy significant capital based on it. Without a statutory duty to consult on guidance, what mechanisms will protect market participants from unvetted, sudden shifts in regulatory expectations?
Lord Howard of Rising (Con)
My Lords, I declare an interest as a holder of listed shares and a director of a listed investment trust.
There is much to be commended in this proposed legislation. Any reduction in regulation and the consequential benefit on the wealth of the nation is to be applauded. I am, however, concerned about the proposed power which will enable new regulations to be introduced without scrutiny. Although introduced with the best intentions, regulations can do more harm than good—partly recognised by having the Bill in front of us today. It is not always possible to foresee the full consequences of regulation. Generally speaking, the more markets are left to themselves, the better off we all are.
An example of regulations having a negative effect is the Basel II agreement. This ruled that personal mortgages were safer than other types of lending and therefore banks would need a lower capital requirement for lending for house purchases. I will not waste your Lordships’ time with the full story—caravans in trailer parks being classed as houses and so on—but this was ultimately a major contributor to the 2008 financial crisis, brought about by a change in regulations. Because of the crisis, regulation in Great Britain was made for pension funds to invest a higher proportion of their funds into safer gilt-edged securities. The gilts gave a lower return than other types of investment. To compensate, pension funds used their gilt-edged securities as collateral to buy more gilt-edged securities to give an overall larger return—little risk as both instruments were Government-backed. Unfortunately, it slipped their minds that interest rates can go up as well as down and rising interest rates would result in losses. Interest rates did go up. Even the Bank of England’s own pension fund was caught out, as interest rates rose and its pension fund faced large losses.
With one regulation on top of another, it is not always possible to see the knock-on effect of regulations. I urge your Lordships, when taking this Bill forward, to have clearly in mind the inability of anyone to fully know what benefits or what collateral damage may result from new regulations. While flexibility may be desirable, it is very important not to delegate too much power without the ability for rule-making bodies to be questioned independently and firmly. It will not do everything, but it may put a brake on rules which impede or hamper the development and success of our financial services industry and reduce risk.
Baroness Hyde of Bemerton (Lab)
My Lords, I thank my noble friend the Minister for bringing this Bill and for its many important clauses. We have had some excellent contributions, but I particularly thank the right reverend Prelate the Bishop of Manchester for his powerful intervention on the nature of debt and its particularly devastating consequences, and the noble Baroness, Lady Morgan of Cotes, for raising the important issue of financial abuse and how this Bill may legislate to be firmly on the side of victims/survivors.
I wanted to contribute to this debate not because I am an expert in financial services, as many eminent speakers across your Lordships’ House today are, but because I care about fairness and the accessibility of financial services to all in our society, so that everyone in the country is able to access ethical and affordable finance. I welcome the measures in this Bill and particularly the clauses on credit unions and measures to protect face-to-face banking. As a member of the sister party to the Labour Party, the Co-operative Party, I declare an interest, and I was delighted to see the Labour manifesto commitment in 2024 to double the size of the UK’s co-operative and mutuals sector. This Bill puts legislative meat on the manifesto bones of how we might do that.
A financial system should serve the economy, and the economy should serve society. As last year’s Triodos Bank report noted, finance has too often become
“an end in itself, a self-referential network of balance sheets and algorithms, more focused on extracting value than creating it”.
This Labour Government are committed to growth, but not growth at any cost—not extractive slash-and-burn economics but growth that offers people in every part of the UK the opportunity to flourish.
Before I come to the proposed changes in the Bill, I will outline why these measures to increase the use of credit unions are so crucial. As other noble Lords have said, the UK has an affordable credit problem. Between 16 million and 20 million people, depending on the source you use, are underserved by the credit market. That is up to 20 million people in the UK who typically have a credit history that falls outside mainstream underwriting criteria. This is a large, non-standard population with a growing need for credit. They broadly fall into three groups. The first is those known as “thin file”: people with low or no credit history. The second is the credit impaired: those with a poor credit rating, which often may be linked to disruptive life events that are usually temporary, such as moving house repeatedly, divorce or loss of a job, which might lead to missed repayments. The third group is those who are highly indebted: people who have taken on too much debt and cannot afford to repay it. These households are facing material economic headwinds, and access to affordable credit is crucial to ensure the near-term economic well-being of those people, their families and communities, and to ensure that the near-term economic conditions do not become entrenched, affecting the long-term viability of these households and communities as credible borrowers.
Outside the realm of personal finance, SMEs and social enterprises also face a multi-billion pound finance gap, particularly those based outside London and the south-east. According to figures from the Federation of Small Businesses, over half of small businesses rate the overall availability and affordability of new credit as poor.
Those are some of the reasons why I am passionate about credit unions and their increased use. As has been said before in this debate, they are member-owned co-operatives with deep ties to local communities, and they are accountable to their members rather than to shareholders. They provide access to credit for people who may be excluded from high street banks, and they offer a more relationship-based model of lending—an essential quality of a financial system that works for everyone in society.
To illustrate this, I have picked a few thumbnail testimonials from Salford Credit Union. One example is the unemployed parent who was offered a free college course to train as a hairdresser. They could not afford the £200 needed to provide the equipment to undertake that course. Salford Credit Union stepped in and loaned them £200, and they were able to buy the kit, retrain and then pay that loan back when employed as a hairdresser. Another example is the person with two children made homeless due to domestic abuse. They were rehoused by a housing association—quite right too—but that property had no furniture. So they applied for and received a loan of £700 to buy furniture, which they were able to pay back at the reasonable rate of £15 per week.
Take the man who was living in a hostel and whose only income came from selling the Big Issue. He was desperate to move out of that hostel because of the difficult living conditions and the abuse he suffered. Over a number of months, the credit union helped him slowly save enough for his own deposit to rent a flat in the private rented sector. He would not have been able to do that without the assistance of Salford Credit Union. I could go on and on—credit unions are brilliant—but, crucially, the proposed reforms to the common bond will enable the credit unions to serve that wider membership. This is an overdue reform, and another reminder of how this Labour Government are working hard every day to improve things for all citizens nationwide.
To support even greater sustainable growth and use of credit unions, I ask my noble friend the Minister to consider capital reforms to credit unions—for example, enabling access to new forms of investment through them. There is also currently no overarching mechanism to assess how effectively banks are meeting the credit needs of underserved communities, and there is no mandate for the FCA to drive that change. So, again, I ask my noble friend the Minister whether the Bill could address this by requiring greater transparency and accountability from mainstream lenders, including formalising a referral pathway to credit unions or community development finance institutions where customers have been declined by them.
Credit unions and community development finance institutions are often best placed to support people and businesses excluded from mainstream finance. In 2025 alone, community development finance institutions lent over £389 million to small businesses, start-ups and individuals. That launched 5,741 businesses, created over 7,000 jobs and safeguarded over 6,500 jobs. Some 88% of those business customers had been previously declined by another lender. With CDFIs lending disproportionately to ethnic minority-led businesses, women-led businesses and businesses based in areas of high deprivation—demonstrating their growing contribution to inclusive economic growth and local resilience—I ask my noble friend the Minister to look again at these and how they might be used more.
Credit unions are a growing and increasingly important part of the UK’s community finance infrastructure, providing affordable lending, savings and financial resilience to millions of people. So let us noble Lords make the most of the opportunity presented by this legislation to turbocharge the potential of credit unions. Finance is not an abstract mechanism; it is a social relationship built on trust, shared expectations and collective institutions—a common bond indeed, at a time when the need is ever greater to spread more widely vehicles for all types of common bond, not just the kind found in credit unions, and to use them wherever possible.
Baroness Young of Old Scone (Lab)
My Lords, I declare my environmental interests as listed in the register, and I thank the Minister for his engaging introduction. He obviously knows something about this, and I look forward to discussing amendments with him in Committee.
I want to draw the Minister’s and the House’s attention not to the specific things in the Bill but to the specific things that are not. The Minister very adequately outlined how important the UK is as a financial centre. It is home to the biggest share of international bank lending and borrowing, it is big in insurance, it is big in pensions, and it has developed a reputation for being big in sustainable finance. UK financial services have major further potential to accelerate the transition to a climate-positive and nature-positive economy and to unlock green growth. I will focus on that today. It is disappointing that the Bill does not move that agenda forward, and the Short Title gives a bit of wriggle room to get some good stuff in.
One of the Government’s stated goals is to make the UK the green finance capital of the world, so I do not think I am trying to press for something that has not already been endorsed by the Government. I am simply lending a helping hand to get us on the road and to make sure that the Bill is not a missed opportunity. Let me give two brief examples and one more substantial one of the issues that the Bill could have tackled. First, the 2024 manifesto and the financial services growth strategy said that the Government intended
“mandating UK-regulated financial institutions—including banks … pension funds, and insurers—and FTSE 100 companies to develop and implement … transition plans that align with the 1.5°C goal of the Paris Agreement”.
These plans would state how each of these institutions would reduce emissions, reshape investments and business activities and manage climate-related risks. The Government consulted in 2025 on taking forward these requirements, but since then there has been silence. The Bill could have introduced legislative action on mandation, and I would like to press for that.
The second example is that the Bill could have made progress on mandating nature-related disclosures. The Institute and Faculty of Actuaries warns that too many financial institutions insufficiently account for climate and nature-related risks in their decision-making and risk management. I think that the insurance industry is very rapidly waking up to those impacts. Reporting on climate-related financial disclosures, TCFD, is mandated for the 1,300 largest UK-registered companies, but TNFD, the nature-related financial disclosures, is not, though these are mandated in the rest of the European Union. Sorry—I should not say “the rest of the European Union”, since we are not in the European Union any more, but you know what I mean. If we do not get some movement in the Bill, can the Minister tell us when and how the Government intend to bring forward nature-related financial disclosures in any way other than voluntarily?
The missed opportunity I really want to focus on most today is the action that we need to tackle the financing of international deforestation. I declare an interest as chair of the Forestry Commission. Deforestation and nature loss pose material risks to financial systems, as nature-related risks could reduce UK GDP by 6% over the next decade, according to the Green Finance Institute. The World Economic Forum ranks biodiversity loss as the second-greatest long-term risk globally. In the Environment Act 2021, we committed to bringing into force secondary regulations, under Schedule 17, to prevent businesses using illegally produced forest goods and to require them to exercise due diligence systems and introduce reporting. Ministers, if pressed, continue to state that an approach on this will be set “in due course”—I love that phrase. This is strange, because at COP 26 the UK positively led and brokered a deal to end and reverse deforestation by 2030. It was a real piece of global leadership.
Since then, we have had the Government’s own security assessment that deforestation-driven biodiversity loss and ecosystem collapse are high-level threats to the UK’s national security. If noble Lords have not read the security report Global Biodiversity Loss, Ecosystem Collapse and National Security, do read it. It is short but devastating, and I would have a stiff gin by your side while you read it. It is an official UK Government security assessment, so it is not just us greenies being alarmist.
The Financial Services and Markets Act 2023 requires that the Treasury
“carry out a review to assess the extent to which regulation of the UK financial system is adequate for the purpose of eliminating the financing of the use of prohibited forest risk commodities”—
a commitment to make sure that we deal with the issue of forest products. I ask the Minister whether the review committed to in that Act is happening and, if not, why not and when it will be undertaken, because its results could have been in this Bill by now. I urge the Minister, at the very least, to persuade his colleagues in other government departments to lay the regulation under Schedule 17 to the Environment Act, which would make it illegal to use commodities in the UK that have been produced on illegally deforested land. This would at least be a step in the right direction.
I do not know about you, but if noble Lords read the Government’s security report, which talks about terrorism, state threats, pandemic risk, economic insecurity and everything else including fallen arches, I think they would be pretty scared by it. I certainly am. Let us not miss the opportunity of the Bill to deliver on the Government’s environmental commitments.
Lord Sikka (Lab)
My Lords, this is primarily an enabling Bill and much of the substance will follow later, through the FCA and PRA rule-making and secondary legislation. Parliament will not have a proper opportunity to amend whatever the FCA agrees with the industry lobby. Consumer protection and confidence in the finance industry will be the biggest casualties. There is much to agree with and support in the Bill, but alas, it also omits crucial issues. There is no reform of short-termism in the City of London, even though for nearly 30 years the UK has languished near or at the bottom of the G7 and the OECD’s investment league. The investment gap cannot be addressed without reform of corporate governance, accounting and executive pay, a law on dividends and the empowerment of stakeholders. I hope the Minister will tell us why these issues are not being addressed.
Shadow banking is now bigger than retail banking, but there is no plan to regulate that either, even though shadow banking is likely to be the epicentre of the next financial crash. In this vacuum, the Bill continues with a deregulatory agenda while more of the post-2008 crash reforms are being dismantled. The weakening of the senior managers and certification regime and accountability is one such example. Currently, complaints can be brought to the ombudsman indefinitely, provided they are brought within three years of the date when the complainant became aware of, or should have reasonably become aware of, the event being complained about. The 10-year limit proposed by Clause 6 is a regressive step. How exactly are people supposed to become aware of the trigger events when Governments and regulators seek to bury them? The Bank of Credit and Commerce International was closed in July 1991 and, to date, there has been no investigation, so how does the 10-year period affect the victims of that scandal?
On numerous occasions in this House, I have referred to the plight of the victims of HBOS frauds, which go back to 2002 and 2007. The senior bank managers fleeced SMEs of around £1 billion. The regulators did little, and the SFO, the FSA and the police passed the buck. In 2017, the Thames Valley Police and Crime Commissioner secured six criminal convictions. Still, the FCA, the SFO and the police did not fully investigate. The Government of the day left it to Lloyds Bank, which owns HBOS, which then appointed Dame Linda Dobbs in 2017 to investigate and issue a report in 2018. To date, there has been no report and victims are still awaiting compensation. Without an investigation and a report, victims of bank frauds cannot approach the ombudsman. Taking HBOS frauds as an example, can the Minister explain when this 10-year window might commence under the clause in the Bill? Clause 6, in my view, harms customer rights and allows banks to escape liability, and that is unacceptable.
I am also concerned about restructuring the Financial Ombudsman Service. It was created in 2001 by Gordon Brown to adjudicate on financial services relationships that are inherently unequal. You have lay persons on one side and giant corporations with billions at their disposal on the other.
Clause 8 severely narrows the right to seek redress by requiring the ombudsman to prioritise whether firms technically complied with FCA rules, rather than whether their actions were “fair and reasonable” in the circumstances. The ombudsman here is being asked to find in favour of the firms if they ticked the right boxes, not according to whether they took fair and reasonable action.
Clause 8 also adds the concept of “consumer responsibility” when things go wrong. So, even when a breach of rules has occurred and the firm has acted unfairly, the ombudsman would be required to consider the general principle that
“consumers should take responsibility for their decisions”.
There are many kinds of consumers: individual versus corporate, amateur versus professional, those with or without expert advice, and diversified or non-diversified. I do not know what kind of consumers this clause seeks to address. The entire clause needs to be deleted; it is unacceptable that, in this day and age, consumer protection is being diminished.
I welcome the absorption of the Payment Systems Regulator into the FCA. I also welcome Clause 14 and the transfer of the regulatory powers of 22 trade associations to the FCA. This will eliminate duplication, buck-passing and ineffectiveness. It was a huge mistake by the previous Government to make accountancy, law and other trade associations AML regulators. In its 2018 report, the Office for Professional Body Anti-Money Laundering Supervision, OPBAS, said:
“the accountancy sector and many smaller professional bodies focus more on representing their members rather than robustly supervising standards. Partly because they don’t believe – or don’t want to believe – that there is any money laundering in their sector. Partly because they believe that their memberships will walk if they come under scrutiny”.
In its follow-up report in 2024, OPBAS said that it
“has not seen any material improvement”
in its professional body supervisors. That is bad. This consolidation is totally justified and I will support it. I hope that Ministers extend this to the regulation of insolvency and auditing as well. I look forward to the Minister’s reply.
Baroness Lawlor (Con)
My Lords, it is a pleasure to follow the noble Lord, Lord Sikka; I always learn from his speeches. The Bill is laudable in its aim to promote growth by cutting regulatory barriers, compliance, duplication and fragmentation, and, in doing so, to reduce the burdens and costs for businesses and support innovation. It aims to achieve these objectives by giving the FCA new powers, as we have heard today. I thank the Minister for his lucid explanation of the powers of the Payment Systems Regulator, which regulates credit card transfers, faster credit and BACS transfers, and which is to be abolished. Other new powers include the Financial Ombudsman Service’s regulatory powers for alternative dispute resolution under FSMA 2000, and the anti-money laundering and counterterrorism duties of the existing 22 professional bodies. The FCA will also have, as we have heard, duties transferred from legislation such as the Consumer Credit Act.
But the transfer of so many powers and functions to the FCA will not be a magic solution, nor indeed a solution at all, unless there is reform to how this regulator operates and how greater accountability can be achieved. The Bill will therefore need some amendments if the FCA is to promote growth and cut regulatory barriers effectively, with better arrangements than those it replaces, since there are many queries about how the FCA operates.
In 2025, the Lords Financial Services Regulation Committee, in its very good report—which has already been mentioned—found that the failings of the two main regulators, the PRA and the FCA, include:
“The deeply entrenched culture of risk aversion … getting in the way of doing what these firms do best … competing, innovating and growing”.
One question here is whether, given such doubts, the changes proposed in the Bill to how the FCA itself works, particularly in Clauses 16 to 22, will lead to the regulator working to promote growth and competition, and whether there is, at the same time, sufficient accountability, predictability and transparency, as well as the checks and balances we need.
I comment on this in respect to the principles, which have had a good airing today so far—I hope that noble Lords will forgive me. The noble Lord, Lord Burns, for instance, referred to the background to the 2000 Act and how and why this solution was arrived at. The principles seem sensible enough. Firms are obliged, among other things, to conduct their business with integrity, skill, care and diligence, to take reasonable care with management and control, and to and pay due regard to the interests of its customers and treat them fairly—all of which seem sensible. But how they have been interpreted has often been a matter of subjective judgment. Smaller businesses especially have found aspects of the regulation baffling, lacking transparency, and unpredictable. They therefore play safe and avoid risk, often at the expense of growth. My noble friend Lady Noakes and the noble Baroness, Lady Bowles, referred to one of the proposals, which is to take out having regard to such principles. The noble Baroness, Lady Bowles, added that the problem is that they need to be applied properly.
I will say a few words about the application. The financial services lawyer Barnabas Reynolds has explained that the principles used, as applied by the regulators, can lead to considerable uncertainty, given the “subjective”, often idiosyncratic, judgments of the regulators. They are applied to
“pin blame on firms and senior personnel regardless of whether relevant rules or guidance existed when the event occurred”,
since the principles are not
“used in the manner of normal common law … to inform the interpretation of specific rules.”
As a result,
“the industry is unable to determine in advance whether many specific actions are permitted or not”.
This is a problem of application.
Indeed, the evidence given to the Select Committee bore this out. Take Principle 12, on the consumer duty, the intended outcome of which was for
“consumers to have confidence in retail financial services markets, with healthy competition based on high standards and … good customer outcomes”.
Witnesses explained to the committee that the implementation had generated uncertainty, saying that
“the FCA has provided insufficient clarity around how it expected firms to comply with the Duty, and that it had created duplication and complexity within the framework”.
They said that
“implementing the Consumer Duty has been difficult due to … ‘the ambiguity of the rules’ and the lack of clarity provided by the FCA”.
This is in respect of the application of these rules, about which the noble Baroness, Lady Bowles, has spoken as well.
The Bill’s accountability mechanisms should be strengthened, which could help deal with this problem of application. As we have heard, noble Lords have objected to removing them altogether and have spoken about the danger of nobody knowing what on earth they will be judged by. I will consider how we can insert clear obligations under law which can be judged in the courts—obligations for predictability, fairness, objectivity and transparency under law.
These could be further promoted by obliging regulators by statute to supervise and enforce predictably, in accordance with their rules, ensuring that their decisions are consistent between firms which operate businesses of the same size and scope. They should be obliged to publish examples of predictable rulings for firms and how they were reached. In this way, there would be greater transparency, predictability would be enforced and firms, as a result, would be encouraged not to be risk averse and would be certain in the knowledge that what the rules say they mean can be established and, if not predictably enforced, can be challenged in court under law.
Baroness Northover (LD)
My Lords, my focus here will be on climate change and, in particular, whether the climate risk to the financial system is adequately addressed—or addressed at all—in the new arrangements the Government are putting forward in the Bill. With the potential consequences of that, it is worth standing back on this.
We all know that, at the least, the complacency about the subprime market in the US resulted in the 2007-08 financial crash—something few were paying attention to. That crash had global effects. The City of London, and therefore the UK economy, were particularly badly affected. I recall the panic of ordinary people who feared their savings would be lost and queued to draw them out, with widespread retail bank failures on the cards. Strenuous and expensive efforts were made to prop up the banks to protect customers. The UK Treasury injected almost £140 billion into failing banks at the peak of the 2008 financial crisis. The Government provided a further £1 trillion in financial guarantees and liquidity backstops to stabilise the financial system. We need to remember that, and we especially need to remember the consequences: austerity for years, living standards frozen and people feeling left behind.
Many have argued that this contributed to Brexit as people thought that coming out of the EU would improve their financial position. As was predicted at the time, and has now been borne out, far from improving things, this actually led to major damage in the UK economy. Then came the expenditure on the pandemic, and the cost to the UK economy grew. People’s living standards have not improved for two decades. It is therefore not surprising that we now see moves to the populist right and left for simple and immediate answers. Economic challenges have their social and political effects, as we have seen before. Therefore, this Bill matters.
The Government are right to seek growth in the economy, and the financial sector is rightly identified as a potential source of growth. Clearly, where regulation is serving no purpose and is obstructing that growth or is out of date, it makes sense to reform it. However, we need to be acutely aware of the huge economic, political and social costs that have resulted from lax regulation and regulators not properly focused on real threats. That is what we need to guard against, and the noble Baroness, Lady Noakes, has decimated the proposals to reduce parliamentary engagement and the removal of regulations into various strategies.
Let me come to my focus here. Just as we have a new landscape in crypto, for example, we need to be aware of climate change as a current and future risk to the financial sector, over both the short and the long term. Clause 17 removes whole swathes of protection, to be replaced by as yet undefined strategies. The FCA has been given huge new responsibilities when we know that regulators have a poor track record in monitoring areas already under their responsibility, let alone horizon-scanning for new risks.
The deletions in the Bill take out regard for climate change, the need to focus on sustainable growth and the need to be compliant with the Climate Change Act, as the noble Baroness, Lady Hayman, mentioned. Yet, as the noble Baroness, Lady Young, said, the UK remains well positioned to capitalise on its reputation as a hub for sustainable finance. I would go further, however: we need now to be acutely aware of climate risk; therefore, we should be strengthening, not weakening, the rules here.
I hope that everyone has read, at the very least, the summary of the recent report produced by the Adaptation Committee of the Climate Change Committee, chaired by our colleague, the noble Baroness, Lady Brown of Cambridge. The world is currently on a path to be around 2 degrees above pre-industrial levels by 2050. We will not return to pre-industrial levels. Our aim has to be to stop further escalation in global heating, but also to seek to adapt to what is already our new climate. There will be parts of the world where this is far more acute than in the UK, but the financial sector is global, with implications going back to our own economy, society and politics. It is a global threat even beyond subprime markets.
The priority risks in the UK alone are intensifying heat, a growing flood risk, rising droughts and wildfire risk. The risk to the insurance industry is obvious. The Adaptation Committee report points out that flood-related insurance claims are rising; home insurers have paid out more in claims than they received in premiums for the five years to 2024. They conclude that by 2050, under 2 degrees centigrade of global warming, many homes and businesses may not be able to access insurance at all. This threatens the viability of the property market, the economy and the sustainability of communities. As the report states:
“A large insurance protection gap means many homes and businesses cannot access insurance due to lack of coverage or high premiums. It also puts stress on the financial sector, as banks face higher default rates on mortgages and business loans, and on public finances through disaster support needs”.
The 2039 end date for the Flood Re reinsurance scheme is also creating uncertainty in the property insurance market, which is having an effect on the housing market—as happened with subprime mortgages. As the report states, actions by financial institutions
“are needed to ensure that physical climate risks don’t disrupt the financial system. The actions will support the maintenance of essential financial services across the economy”.
The UK is home to the biggest share of international bank lending and borrowing. It is the largest market for international debt issuance and the world’s largest specialty insurance market, as well as the fourth-largest insurance market overall. One can see parallels with what happened leading up to the 2008 financial crash. The current risk to the housing market and to the insurance industry is clear. Therefore, it is vital that climate risk is included in the Bill, rather than excluded even from regulation. This is one challenge which, unfortunately, we can be absolutely sure will persist for many years to come—way beyond the life of this legislation—and therefore must be enshrined within this Bill.
Baroness Bennett of Manor Castle (GP)
My Lords, it is a great pleasure to follow the noble Baroness, Lady Northover, and to agree with her warning. I add the phrase “carbon bubble” as a further financial risk. I also must cross-reference her contribution to the words in the Minister’s opening speech about increasing the insurance business in London. This seems like a very bad idea indeed in view of the risks we face in the climate emergency and nature crisis. I note that, at this moment, we are facing the risk of an extreme El Niño, with impacts we should well understand.
But here we are again: I join a small but merry band of financial services Bill veterans—this is my third—and I welcome the Minister to our group and look forward to our deliberations. I say “look forward” genuinely, because this is the most positive start to such a debate that I have heard. There was a great deal in the speeches thus far that I agree with, and more determination than I have heard previously in your Lordships’ House to at least start to tackle what economist Ann Pettifor has termed the “global casino” of which the UK financial sector is a significant part. We did not hear those powerful words just from the noble Lord, Lord Sikka—always welcome as they are—and that makes a welcome change.
When I first took part in the debates on what became the Financial Services Act 2021, I was new enough to be shocked at the narrowness of the debate, with a Conservative Government reducing regulation and controls, while the Labour Front Bench just nodded along. Amendment after amendment in Committee and on Report came from those who wanted the Government to go further and faster in deregulating, in letting the financial sector rip, even though it was little more than a decade since we had seen the cost of that in 2007 and 2008.
Today, though, we have heard from the right reverend Prelate the Bishop of Manchester powerful words not just about the financial sector’s failure to meet the needs of many parts of our society but also about the damage the sector does to many of the vulnerable. I have not yet persuaded the House’s champion against child poverty, the noble Baroness, Lady Lister, to take part in one of these debates, but I hope one day she and others will, because finance is far too important—and damaging—to be left to the bankers.
Today, the noble Lord, Lord Sharkey, was speaking up for the interests of consumers of financial products, so often the victims of predatory practices not just by the fringes of the sector but by the highly profitable giant organisations at its heart. I associate myself and the Green Party with those remarks, while declaring my membership of the APPG on Investment Fraud and Fairer Financial Services.
We heard from the noble Baroness, Lady Hodge of Barking, well known for her championing of action against corruption, about the need to tackle the rampant corruption and fraud. However, I do not agree with the noble Baroness’s conclusion that we are talking about a few “rotten apples” rather than structurally embedded corruption, with roots going back centuries.
After all, the City of London, and with Crown dependencies—so disturbingly highlighted last week in an exhibition in Portcullis House that, unsurprisingly, attracted a great deal of negative attention—is, as the then deputy Foreign Secretary Andrew Mitchell said in 2024, a conduit for nearly 40% of the world’s dirty money. As the noble Lord, Lord Evans of Weardale, said in 2022, in a debate on corruption secured by my noble friend Lady Jones,
“we have clearly, as a matter of policy, turned a blind eye to the perpetrators of corruption overseas using London for business or leisure purposes”.—[Official Report, 13/10/22; col. GC 156.]
That of course is being helped by those enablers to which the noble Baroness, Lady Hodge, referred.
Looking back to 2020, if fellow noble Lords had expected me to take part at all in the debate, they probably would have predicted I would make comments resembling those powerfully made today by the noble Baronesses, Lady Hayman and Lady Northover, work on which Peers for the Planet has been so prominent, in pointing out there is no financial sector on a dead planet, and that the economy is a complete subset of the environment.
However, the House was in for a shock in 2020—perhaps not for the last time. When I spoke then about corruption and the City of London’s place at the heart of it, I got more than the odd gasp, and fervent head shaking and opposition. This was when, for the Government, the noble Lord, Lord Agnew of Oulton, said:
“The UK is internationally recognised as having some of the strongest controls worldwide for tackling money laundering and terrorist financing”.—[Official Report, 28/1/21; col. 1880.]
Well, on these subjects, we have come a long way, as indeed the noble Lord, Lord Agnew, has in his views. The debate has shifted far closer to where the Green Party has always been, saying, as the noble Lord, Lord Eatwell, said, in the relationship between society and the financial sector, the settlement is not working. The financial sector is not providing the appropriate support to the real economy and is extracting excessive profits from its traditional sectors and from parts of our society in which it should have no place, such as children’s social care, aged care, water companies and many other public services. Excessive pay is also being extracted, as the High Pay Centre has been so prominent in highlighting, and the sheer size and risk-taking threatens the security of us all. We have too much finance, so the Bill should not be seeking to grow more—as well as of course, too much corruption and fraud. There is another way, as the Global Justice Report by Thomas Piketty’s World Inequality Lab demonstrated this week.
There is also an issue not yet raised by others: the cost of the speculation in the prices we all pay for the basics of life, for food and for fuel, and the impact of the financial sector’s bulking up of lending on house prices. Food security, as the Green Party is trying to get the Government to understand, is a huge and present issue in the UK, and the financial sector is a significant part of the problem.
The noble Lord, Lord Eatwell, said risk aversion has its uses—I can only agree. He questioned, however, the cost to the sector of regulation, but the cost to all of us in getting it wrong is of course enormous and possibly existential. We must not forget how close we got in October 2008 to total collapse.
It is customary at Second Reading to mention issues that one wishes to raise in Committee, and I have pointed to my areas of interest: making the financial sector work for the real economy; tackling corruption and fraud; protecting consumers; of course, nature and climate; and tackling the cost of speculation to us all. But I will raise one final issue, which I will be tackling within the Bill if I can find a way. It is an issue that politicians around the global North have been facing for a long time. I go back to US President Roosevelt in 1936:
“Business and financial monopoly, speculation, reckless banking ... had begun to consider the Government of the United States as a mere appendage to their own affairs. We know now that Government by organized money is just as dangerous as Government by organized mob”.
We have, just down the road from us, the City of London and the City of London Corporation, which have a unique, archaic and dangerous place outside the rules that apply to the rest of society—rules about democracy and rules about transparency. This is a place where organised money rules. I mentioned the APPG on Investment Fraud and Fairer Financial Services, which I am working with now on a survey, asking for views on whether the corporation should be maintained as it is, reformed, or abolished, as a royal commission recommended in 1894.
We have come a long way in our understanding of the issues in the financial sector. We will have to see how far we can go, because we need to grasp, as I respectfully say to the Minister, that the City is not one of our greatest economic success stories but an entity that needs far tighter, stronger controls from the Government for the security of us all.
Lord Mann (Lab)
If we had green technology in households and businesses everywhere, then we would be less reliant on Russia, China and Iran. So, why is there no financial product that the householder can get hold of to put, say, solar panels on their roof, so they and the country benefit? Why is there not a product for schools to do the same thing or a product for an NHS trust to do the same thing? If the technology works and is sufficiently profitable, then a good financial product would make common sense. But I see none for schools or for NHS trusts, and those for householders and small businesses in particular are rather limited. I would be interested in the Minister’s observations, because it seems to me that is relevant to the Bill far more than it is relevant to the Energy Secretary.
Secondly, the Minister was very bullish about how mutuals and co-operatives are going to double. We are two years into five years of a Labour Government. I would be interested to know whether we are 40% towards that doubling now, and if not, which are the sectors that are going to lead the way in the next three years, and how. I would also be interested, perhaps in writing, to understand that, in the case of one small sector, county cricket clubs, whether it is the Government’s expectation that in the next three years, they will be as mutualised as they are now, or significantly less so.
My third and most substantial point is on financial mis-selling. I have previously raised the V11 group of working-class footballers who were done out of their investments by fraud. Exactly what happened to them is very similar to what happened to the coal miners—a separate case; it was not financial fraud but lawyers who were ripping them off and taking their money. There, the ombudsman did a special report in 2008. I managed to get 43 firms of solicitors disciplined and fined; I got 12 removed from practice.
Let us take the financial sector and what has happened to those former footballers, as well as to many other groups in society who have been mis-sold products. I do not see the same system. As vice-chair of the Treasury Select Committee in another House, I had to deal with the Financial Ombudsman Service for four years, and I found it lacking in purpose and losing skills and experience all the time. I did not see the level of leadership needed to take hold of things. How is that going to change—I hope it will—with a shift of power to the Financial Conduct Authority?
Looking at the V11 case as an example, the fraud was palmed off to the Serious Fraud Office and the City of London Police. Why? Why did it go to one specific police force? I had dealings with the SFO. When it came to the coal miners and the legal scandals, which were mega, I got money—millions of pounds—back for more than 2,000 of my then constituents. Why is that not being handled more effectively at the beginning? In this case, we are talking about financial mis-selling, which is a conduct issue, as well as fraud, which is a policing issue—and there is a mishmash in the middle. I want to be convinced that the Financial Conduct Authority will cut through that.
If working-class sports stars and musicians come into money and find others taking their money away from them—by mis-selling or, worse, by fraud and mis-selling—why would others invest in those products in the first place? In the case of the footballers and Kingsbridge Asset Management, that idea was brought forward by the Government and the then Chancellor Gordon Brown as a way to develop the UK film industry and as the right thing to do. If working-class people do the right thing and get some money and invest it, who is going to protect that? People are not surrounded by good accountants, if any, or by good lawyers, if any, when they first come into money.
If we look at the financial fraud cases, we see case after case where people are getting done over by people who appear to be cleverer than them, giving them advice and mis-selling—and the system is not helping them out. That is fundamental. That is the bit that I want to see more of in the Bill. If we are appealing to the country by saying, “Do the right thing and invest in the future”—whatever kind of investment—there have to be guarantees. The system has to be robust enough so that, when there is wrongdoing, somebody is going to sort it out. The mishmash of the SFO and the City of London Police is not a system; it is just a hope—and it has proven to be a failed hope.
I ask the Minister, if the FCA is taking that responsibility, what precisely will the Government say to the FCA on the systems, the skills and the reporting back, including to Parliament, that it is going to give, to show that it is up to the mark in being able to handle the mis-selling and the fraudsters? Has it got the powers it needs to prosecute? That seems to me to be fundamental. The separation of prosecution and those looking at financial mis-selling is one of the lessons from the V11 group, the loan charges and the other, multiple scandals that we have seen in the past two decades. People need to be confident in the system around financial services, and we need to make sure they are. I look forward to hearing from the Minister precisely what he is going to say to the FCA, should this Bill be passed and the FCA be given more power.
Lord Holmes of Richmond (Con)
My Lords, it is a pleasure to take part in this Second Reading debate, and, in doing so, I declare my technology interests as adviser variously to the Crown Estate, Endava plc and Simmons & Simmons LLP. I congratulate the Minister on the clear and cogent way he introduced the provisions in the Bill. I will concentrate largely on what is not in the Bill now but what I hope may be included by the time we get to Third Reading.
First, AI is across our society, our economy and our financial services—be that in fraud detection, credit decisioning or algo trading—yet, currently, the Bill is strangely silent on it. The regulator is having to use existing powers that were never designed for these new technologies.
To that effect, what does the Minister believe is the right approach to AI in the Bill, given that the Government have stated that they will take a domain-specific approach, leaving it to the individual regulators? If one takes that approach, how can a consumer or customer of a financial services product be guaranteed clarity, consistency and a coherent approach when they avail themselves of financial services, not least because there are two regulators in this sector? A business may well have dual regulatory responsibilities, so how would not having horizontal and cross-sector AI regulation work?
There is no effective framework for cyber resilience in the Bill. In contrast to AI, the Government have decided that, on cyber, you can have a cross-economy and cross-society approach. I ask the Minister: what is different about cyber? Why can it be seen to be cross-sector, but AI cannot?
On financial inclusion, I welcome the provisions around access to banking and in-person services. Although, as other noble Lords have mentioned, the devil is largely in the detail as to what precisely is meant by the services, there is almost no point whatever in having a branch open if, when you go into that branch, you are told that there is machine or a screen in the corner that you can go and use. How is that financial inclusion or digital inclusion? When financial exclusion and digital exclusion all too often walk hand in hand, we need greater clarity in the Bill when it comes to these financial inclusion and access requirements.
We should consider what the third-largest economy in the world is. The United States is first, and China is second. In third place is fraud and economic, cyber and financial crime—it amounts to $10.5 trillion, which could affect hospitals, schools, teachers, nurses, doctors, defence or any element of state spending. One can be sure that the UK is losing its share of billions in financial crime and fraud. Yet where is the modern framework in the Bill to address these new fraud vectors, not least AI-enabled fraud? Why is there not more in the Bill that looks to address how AI can be deployed as a sword and shield against the nefarious use of AI?
There are a few nods and winks in the Bill to financial education, but we need to see much more on this. If there is to be less asymmetry between customer and firm, financial education is critical. How can the Government, the Financial Inclusion Committee, the Money and Pensions Service, which does such great work, and firms themselves can be brought together to have a far greater, coherent and consistent approach to financial education for all? How will this tailor with what is currently proposed, with the excellent Francis review of the curriculum? What will financial education look like in that?
There are many positive provisions in the Bill, but it is marked by errors and omissions excepted. There is so much that is not in the Bill that needs to be in it. It is a significant Financial Services and Markets Bill, yet it is silent on AI and cyber and it is quiet, if not completely silent, on financial inclusion, fraud and financial education. If this continues unamended and these issues unaddressed, individuals, our communities and our country will be the worse for it. They will be under-enabled and under-empowered and, as a consequence, there will be more than suboptimal economic activity. We have the Bill. We do not need to make it bigger, but we can make it better.
Lord Sahota (Lab)
My Lords, I welcome the opportunity to contribute to the debate on the Financial Services and Markets Bill, in particular to consider the implications for local authorities, local communities and the people who we are here to serve. At a time when high streets continue to face significant challenges, there are aspects of the Bill that deserve recognition and support.
One of the most important is the effort to preserve access to essential banking services. For many people, particularly older residents, small businesses and those who are less confident using digital services, access to physical bank branches remains vital. The closure of bank branches over the years has had a profound impact on communities across our country. A local bank is not merely a place to deposit money or seek financial advice, but often an anchor institution that helps sustain footfall, support local businesses and contribute to the vitality of the high street. In many of the communities that I have visited, the loss of local bank branches has been felt just as keenly as the loss of local post offices. Measures that seek to maintain access to cash and banking facilities therefore have benefits that extend far beyond the financial sector itself. They help to keep our town centres active, accessible and economically resilient.
The Bill also contains provisions aimed at strengthening consumer protection and promoting a more competitive financial services sector. If implemented effectively, these measures could improve access to affordable financial products, encourage innovation and help to ensure that customers receive fair treatment. Such outcomes would be welcomed by households facing continued cost of living pressures and by small businesses seeking access to finance and investment.
However, while there is much to commend in this Bill, there are also important questions that deserve careful consideration. Local authorities have long played a crucial role in supporting vulnerable residents, promoting financial inclusion and responding to local economic needs. They possess local, detailed knowledge of the challenges faced by their communities and are frequently the first to identify emerging problems. Will the Minister clarify how local authorities will be consulted as new regulatory frameworks and powers are implemented? What mechanism will exist to ensure that local knowledge will be used in decision-making? How will the council be able to raise concerns when changes in banking provision, financial services or regulatory practice have unintended consequences for local residents?
I would also welcome clarification of how the Government intend to measure the impact of these reforms on financial exclusion. What assessment has been made of the effects on rural communities, deprived urban areas and those who continue to rely heavily on face-to-face services? Furthermore, what safeguards will be put in place to ensure that the transition towards digital financial services does not leave behind those who are least able to access them? Finally, can the Minister explain how the Government will balance this regulatory efficiency with the equally important need for local accountability and community engagement?
The success of this Bill should ultimately be judged not on its effect on markets and institutions but on its impact on ordinary people. If it helps to maintain a vibrant high street, protect access to essential services and strengthen financial inclusion, it will make a valuable contribution. However, we must also ensure that local authorities retain a meaningful voice in shaping the outcome for the communities that they know best.
Lord Thomas of Cwmgiedd (CB)
My Lords, I, too, welcome this Bill as an important step in strengthening the position of London in the world’s financial markets. However, I also pay tribute to the regulators, particularly the FCA, who have had to cope with markets that have changed enormously over the years that the FCA has been in existence. However, the fact that one extends praise to them does not mean that things do not need putting right.
There are two areas that I wish to address. The first is the problem of climate change, which has been so ably addressed by the noble Baronesses, Lady Hayman and Lady Northover. I agree completely with what they said. I want to underline the effect that this is having. There is litigation in almost every country in the world about the risks of climate change. Central banks and regulators worldwide are concerned about its impact. We must therefore ensure that this Bill is fit to deal with this problem and that regulation of the financial markets, because of what is involved for the longer term, deals properly with this area.
The second area is the control—I use that word deliberately—that Parliament should exercise over regulators and their accountability. In doing so, I declare my interest as chairman of the Financial Markets Law Committee, though I speak in an entirely personal capacity. One symptom of the current problem can be taken simply from the volume of litigation. We all suffer in this House from, and complain about, the thickness of the Bills and statutory instruments that we have to look at. Perhaps the problem of our age is being unable to express ourselves concisely enough. However, it is an extremely serious problem in the financial markets. Last year, the FCA produced 1,918 pages of regulatory instruments. The fact that so much legislation is being produced—the noble Lord, Lord Pitt-Watson, gave an illustration earlier of the change—shows that someone needs to hold the regulators accountable and ask why we need it all.
There are five points I would like to make. First, there is a serious problem with Clause 17 because of the weakening effect it has on transparency and proportionality and, as the noble Baroness, Lady Noakes, so clearly demonstrated, the more insidious impact it will have on the ability of this House to scrutinise Bills. We must increase scrutiny and outside control, because fundamental to any body that makes laws or, as in the case of the FCA, also enforces them, is accountability, and I think there is a plain lack of accountability.
Secondly, I accept, as the Treasury rightly points out, that expertise is required to draft the regulations. These transactions, when I look at them, are of immense complexity, and you really need to understand the market to draft them, but that does not mean that you do not need someone looking over your shoulder to see whether you are getting it right. It is very easy to see just trees and forget the wood. What I cannot understand is why the regulator is not happy for someone to look over what it is doing, because if things go wrong, it is a mighty source of comfort. There is no doubt we shall have another financial crisis in a way none of us can anticipate.
Thirdly, there is a wider issue as to the form of rules. We have got to a stage now where we produce very detailed rules, and we have to ask ourselves: is this the right approach? Compliance departments like detailed rules, because if you have detailed rules, all you have to do is go through them all—tick, tick, tick, tick—and you have complied with your obligations. But that should not be the test. The test should be: “Have you complied with the principles?” We are in danger of transferring to the regulator the risk that market participants should have in complying with the underlying principles and not merely with the tick-box exercises of dealing with rules. I pointed this out when, with a co-inspector in the system of inspections we used to have many years ago, we said that one of the problems with the whole Maxwell case was a tick-box mentality, and we must always remember that.
It is also necessary to point out that, if you have very clever people, and one of the regulator’s difficulties is that the people he supervises pay so much money, you can always use rules to justify what is done. It is worth turning up what happened in Enron. Time does not permit me to explain, but Enron is a classic case of applying rules to produce a result that was completely contrary to the underlying principles.
Fourthly, there is cost. The point is, very shortly made, long and complex rules are very expensive. Fifthly, there is consultation. It is very important that we look very carefully at the provisions in the Bill relating to consultations with the market. When drafting, it is very easy, as long experience has taught me, to overlook the obvious. We have to be very careful in what we permit the regulators to do without consultation with the market.
For those reasons, therefore, I very much hope we will scrutinise these two areas of the Bill in particular, and again I pay tribute to the noble Baroness, Lady Noakes, for the extraordinarily lucid explanation she gave of the problems with Part 3, Clause 17 in particular.
Lord Tunnicliffe (Lab)
My Lords, for 14 years, I was the most junior opposition Treasury spokesman. A slight problem with that is I was occasionally—in fact, more than occasionally—the most senior opposition Treasury spokesman, largely because there was only one of me. Settling into being a Back-Bencher, I glanced at what was coming ahead and decided I had a duty to participate in this debate and learn. I have looked at the Bill and concluded it is what I am going to call “motherhood”. That is not to belittle it, but part by part by part, it attacks individual problems and proposes solutions. We will be very good at that; we will work at it; and we will, I hope, get a good result.
The only bits that hit my eyes were Clauses 39 and 40 on ring-fencing. The global financial crisis in 2008-09 was right at the beginning of my career as an ill-informed Front-Bencher. I have been through virtually all the Bills—I think only the noble Baroness and I have been there so consistently, although there was of course also the noble Baroness, Lady Kramer. We had the global financial crisis in 2008-09, and we really must remember that. It has been mentioned that there will be another one; we do not know what it is, but we should think about how we are prepared for it. I could not agree more with that.
In the 2008-09 financial crisis, the world teetered on the edge of financial chaos. It was solved by a lot of people, but I am particularly proud of Alistair Darling and Gordon Brown for what they did in those weeks when we really did not know what would happen next. After the crisis, we created the Independent Commission on Banking, the Vickers commission, which reported in September 2011 and proposed ring-fencing. I must say that the consensus view on our side was of a good report, a good commission and great people, and the output produced general approval, including from me.
In anticipation of this debate, and looking at ring-fencing as the most significant point that it would touch on, I decided to read a few reports. I read the Ring-fencing and Proprietary Trading Independent Review by Keith Skeoch. It is a fascinating document, which was published in March 2022. The Treasury produced A Smarter Ring-fencing Regime in November 2024 and Safeguarding Stability, Enabling Growth in May 2026. I am afraid I concluded that the ring-fencing regime was doing little good and, in many parts, harm. It has been overtaken in the area of protection by The Bank of England’s Approach to Resolution, of October 2017.
I became fascinated by this resolution stuff—funny things happen to you in old age—and managed to get somebody in the Bank of England, the official who is in charge of resolution, to give me a series of seminars on the telephone. He was a bit suspicious, so he said he had to have his solicitor with him throughout the conversation. I feel I understood it, and I think the claim made in some of these reports is this: all the good that ring-fencing produces is covered by the resolution regime, but the resolution regime, at the end of the day, takes years in preparation, as various banks are persuaded to take particular actions to make them more robust in a crisis. But it actually happens in about 60 hours over a weekend. It is a very elegant process, and they have enormous powers.
I feel that there is a strong case for a relook at ring-fencing, recognising that the resolution regime gives all the protection. We must not lose sight of what we were trying to do. We were trying to avoid the “too large to fail” dilemma. The resolution regime does that. It does not do it for just ring-fenced banks; it does it for all banks. It achieves almost certainly the minimum cost to the public purse—normally, no cost to the public purse. It prevents systemic impacts.
The reason I am making this so short is because the only Bill that goes into the details last about 40 minutes and I did not think this was the time of night to start on it. I simply say that I hope I will be able to find a way, I hope even some support, to produce amendments to the Bill so that we have a proper discussion that looks at whether ring-fencing is still fit for purpose and the extent to which the resolution regime can take over much of its work. The rest of its work, if any, can be distributed within the regime. We can take away the detailed problems that are all over the place in its application, which is a negative to the system, and remove the fact that there are two regulators, which is always a bad thing, especially when one is going to take over at the last minute, as the Bank of England has the power to do in the resolution regime.
Baroness Kramer (LD)
My Lords, as the first of the winding speakers, I thank the Minister for his willingness to meet. I suspect that after listening to what has been an extraordinary, exceptional debate with everything a powerful contribution, he now knows that this is not a small, technical Bill that will slide easily through this House.
We have agreed generally that the financial services sector contributes something like 10% of the UK’s economic output, and, consequently, that innovation and growth in this sector matters. However, I want to pick up the point, which others have made, that it is important that we do not repeat the mistakes of the past. This sector brought the UK economy to its knees. My noble friend Lady Northover, the noble Lord, Lord Davies of Brixton, and to some extent the noble Lord, Lord Tunnicliffe, gave us a feel of how damaging it was at the time. To say the world teetered was probably the right phrase, but the consequences have dragged on way beyond that and still have deep impacts today on ordinary people dealing with their cost of living.
Following that crisis, the revised regulation put into the books was based on precautionary principles. I never have objections to streamlining, efficiency and limiting duplication, and I agree that some measures went too far or were too broad, but this Bill fundamentally changes that precautionary approach and replaces the principle with assurances of enforcement action in relation to poor or corrupt behaviour, and with bank failures, as the noble Lord, Lord Tunnicliffe, described, resolution schemes come to the rescue. I question whether the Bill adequately structures the capacity to make the shift.
In the case of enforcement, I have asked the Minister directly to demonstrate to me that enforcement has teeth. I talked to the City again this morning and, frankly, it laughed. It is one of the reasons why, if we cannot have certification and precautionary principles around “fit and proper”, enforcement is critical. I want to hear much more from the Government on that issue, and that is just one example.
Picking up on the point made by the noble Lord, Lord Tunnicliffe—I disagree with him completely—that in the case of resolution, we do not need ring-fencing because we have a resolution regime in place or we can weaken the one because the other exists. Will the Minister be able to look me in the eye and say that he would activate a bail-in bond scheme if a big bank failed? The consequence would be huge financial instability among those who held those bail-in bonds—I am talking about the insurance companies and pension funds. Many would be on the verge of collapse if we ever exercised bailing in those bonds. That is one of the reasons why, in the financial crises that have happened, no Government have ever taken that step.
That is a minor issue around ring-fencing, though. There are lots of issues there. I will want to pick up the one on intrabank group services—I am just giving notice to the Government—because the removal of the ring-fence there allows services to be brought in from overseas bodies that are not regulated by any UK authority. We heard from the noble Lord, Lord Eatwell, who I know is very concerned about MREL and whether bail-in bonds could ever be used, the noble Lord, Lord Davies of Brixton, and others on these issues.
I join my noble friend Lord Sharkey in his utter frustration at the undermining of the FOS, the Financial Ombudsman Service, and the narrowing of protection, the narrowing of free and fair redress. We are going to take that on in this Bill. I also join the noble Baroness, Lady Noakes, in her brilliant speech. My noble friends Lady Bowles and Lady Northover spoke on the same issue, as did the noble and learned Lord, Lord Thomas, in some ways. The noble Baroness, Lady Noakes, used the word “shock” in relation to the regulatory principles applied by both regulators, which currently sit in primary legislation—proportionality, fairness, responsibility, transparency and, yes, regard to climate change—being removed from primary legislation by this Bill and reduced to elements in a five-year strategy document. Those regulatory principles are Parliament’s instructions to the regulators, but will now have no legal standing. If the regulator does not pursue them, there can be no action in court and no charge of judicial review. It is entirely up to the regulator whether those principles are observed.
I note that it is very clear in the Bill that the strategy document on which we will now depend can be revised at any time with no consultation; the regulators are merely required to note in their annual reports whether they have bothered to have any regard to the principles. The main purpose of this change—we have seen this pressure before from the regulator—is to cut Parliament out of any control over the principles of the regulator and make sure that there is no additional recourse when they are abandoned. This change has to go, and I suspect that will be the verdict of most of this House.
That brings me not just to the commissions in this Bill but to its omissions. I am really grateful to the noble Lord, Lord Holmes, who raised AI and cyber issues about which I am, frankly, not sufficiently informed, but I am sure he is right that they need to be addressed in this Bill. The omission that exercises my party most is around access to financial services for both small businesses and disadvantaged individuals who are very poorly served at present. These issues were eloquently addressed by the noble Baronesses, Lady MacLeod and Lady Hyde, the right reverend Prelate the Bishop of Manchester, and the noble Lords, Lord Kamall and Lord Sahota, in really powerful discussions.
This Bill takes some necessary steps on credit unions, credit data sharing, and permits action on the anticipated Lloyd review of in-person banking, but it could go so much further and bolster—I am so glad that the noble Lord, Lord Kamall, and others have mentioned this—community development financial institutions, including credit unions. With thanks to the fair banking movement, I will propose a rating system to show where there are shortfalls in lending and other financial services. I will then go beyond that to propose remedies, including mechanisms to provide investment into CDFIs for those banks that do not wish to change their lending practices. A revival of local banking, which has largely been discarded in the business models of the big banks, would drive up growth, jobs and living standards in all our communities.
The US tech sector is brilliant at not paying its way at the expense of British competitors. Online platforms facilitating fraud should have reimbursement liability; it should not just be for banks. We hope we can find a way to bring in that change. We also insist that across all recognised payment systems, including big-tech, participants—not just the banks—must be subject to the levy to support financial inclusion. Again, I hope we can bring in language for that.
We should also use this Bill to face up to the expected risks in financial stability. A key concern is the burgeoning private asset market—now $18 trillion strong—and the private credit market discussed by the noble Baroness, Lady Bi. It is interconnected throughout lending, investing and derivatives throughout the regulated financial sector. That private market is opaque; it is an intermingling of excellent credit and complete garbage, and it easily becomes illiquid. I want it to be a clear responsibility of the Bank of England and the PRA to assess the risks of a broad-based credit crunch in private markets. I am also concerned that the regulatory perimeter that excludes small businesses from most FCA protections, may become a serious issue in a private credit crunch. So I will seek to add to the regulators’ principles consideration of the risk arising from these issues.
Digital payments and finance are coming at us fast—we cannot be King Canute but, frankly, we have had enough of scams and money laundering. The noble Baroness, Lady Bi, and, very extensively, the noble Baroness, Lady Hodge, talked about the importance of taking action to deal with enablers, but I think this Bill should also be an opportunity to get the right guardrails in place for crypto. I am very much behind putting requirements on the tech sector, and requiring the stablecoin exchanges to act against fraud, sanctions busting and money laundering. But I am not sure this should be done through Henry VIII powers, and I will give you a reason. I am concerned, for example, that in exchange for putting these requirements on stablecoin exchanges, the Bank of England is proposing to step in as a backstop if they have liquidity problems—they have made that statement publicly. Even in the US and the EU, no Government will touch that offer of a liquidity backstop with a barge pole. It is such a big issue that this is an area where Parliament should be making the decision and not the regulator.
History tells us that those who cannot remember the past are condemned to repeat it. If we repeat 2007, we lose all our chances to seize the opportunities for the future. So, my colleagues and I will try to make sure that Parliament’s voice remains, the guardrails are in place for the financial sector and even for crypto, and with the tech companies paying their share, and we will see game-changing improvements that achieve access to finance for all communities, individuals and small businesses. Fair and sustainable growth is more than possible and it is what the public expects of us.
Lord Altrincham (Con)
I thank the Minister for hosting this debate with such courtesy and speaking so well at the start. I declare my interest as a director of South Molton Street Capital and also as former director of the Co-operative Bank. I follow the words of my noble friend Lady Neville-Rolfe in saying that we welcome this Bill. It addresses a widespread sense that financial regulation has become a little too complex. We have heard that this evening in debate, but that sense also seems to be held by the Treasury, the National Audit Office and, clearly, by the Government. The Government have generated multiple reviews and inquiries that underpin the clauses in the Bill.
To look at just a few of them, Clause 26 follows the committee on banking standards. This is the clause that looks at the senior management regime, where there is a huge need for reform and a reduction in bureaucracy. The Government have asked for a 50% reduction in bureaucracy, which we would welcome. The senior management regime itself is really quite a complex thing, and it probably does not quite do what Members of your Lordships’ House would expect—partly because some of the people who participate in it do not fully understand the regime themselves or what their obligations are.
Clauses 16 and 17 are the two quite controversial clauses that were spoken about today. One is on the five-year plan—the unsupervised five-year plan at the FCA—and the other is on weakening the link to the regulatory principles. Noble Lords have spoken today about the importance of oversight and of keeping an eye on what the FCA is up to. But going right back to the beginning of how the regulator was set up—the noble Lord, Lord Eatwell, reminded us of his participation in that, along with the noble Lord, Lord Burns—when the Financial Services and Markets Act 2000 set it up, it established that there would be a cost-benefit analysis that would essentially hold the regulators to account to be honest in how they develop regulation.
The FCA is running a review at the moment of cost-benefit analysis with Dr Felix Martin. We might, at the very least, hold the regulators to that part of their own obligation: proper cost-benefit analysis, and proper supervision of that analysis. That is even before we get to proper supervision in Parliament, which we have only just managed to put into the last Bill, as your Lordships know.
Clause 39 is on the ring-fence. It was interesting to hear the noble Lord, Lord Tunnicliffe, on that. The ring-fence clause also sits on a variety of reviews, in particular the Keith Skeoch review of 2022. It is worth remembering that his review in 2022 said that it supported the ring-fence but was very explicit on a few other points, one of which was that it is very expensive. There is an economic burden to running this ring-fence regime, in the order of £1.5 billion a year. But Skeoch also said that the benefits of the ring-fence regime would be diminishing, for the reasons we have just heard: because of the strength of the regulatory regime elsewhere, in particular the resolution regime. Then he added that the ring-fence might lead to ossification—quite a strong word—in retail bank services.
We might hope that that has not quite happened, but we know that there have been closures of hundreds of bank branches, so we might expect that all those closures would suggest at least a moderate reduction in retail bank services. That is before we even get to the provisions in Clause 3, which themselves are underpinned by a review into what is happening in retail banking at the moment. We might take quite a hard look at that, because it touches on the issues raised by my noble friend Lord Kamall—access to banking services for more vulnerable people—and by the noble Baroness, Lady Morgan: financial abuse and what is happening in the retail bank market. It just underpins the fact that so many of these clauses sit on quite careful inquiry.
This pattern, whereby there is a review and a recommendation, and it winds up in consequential legislation, means that the FCA acquires more powers every single time. Then we come back to why the FCA has all these powers, what it is doing with them and what we can do in Parliament about it, which is why in debating the last financial services Bill we spent so much time on oversight and accountability, so I will start there.
Oversight in Parliament for financial regulation has been improved with the previous Financial Services and Markets Act and, to the credit of Parliament and the Government, there have been quite important changes with the increase in the MREL threshold in September and the deposit threshold for the leverage ratio in November, and a reduction—for the first time since the financial crisis—in the Tier 1 capital ratio by the Bank of England in December. Oversight in Parliament was at least part of the reason for the change but, as a number of noble Lords have said, this Bill removes significant parts of the existing regulatory architecture. That was specifically of concern to my noble friend Lord Howard and mentioned by the noble Baroness, Lady Bowles.
In doing so, the Bill transfers considerable power to the Treasury, the FCA and the PRA to design and implement the new regime. Clause 3 adds Henry VIII powers that might create quite unintended consequences. Clauses 16 to 18 specifically tend to weaken supervision. We understand the argument the Minister is likely to make, which is that placing more of the framework outside primary legislation can allow for greater flexibility, speed and responsiveness. But flexibility must not come at the expense of accountability, and simplification must not become a means of transferring major policy choices away from Parliament and into the hands of regulators without proper oversight.
The FCA and the PRA rightly enjoy statutory independence from the Chancellor, but that independence makes parliamentary accountability even more important. Their principal democratic accountability is not to Ministers but to Parliament, and in practice that accountability is exercised largely through committees in both Houses.
I turn to regulatory proportionality. The second key concern I have is proportionality, which was discussed extremely clearly by my noble friend Lady Noakes and also by my noble friend Lady Lawlor. My noble friend Lady Noakes is right to say that proportionality needs to be uppermost in the minds of the regulators. It is the detail of rules, guidance and decisions that matter, not the broad-base strategies. Of course, lack of proportionality can arise for lots of reasons, perhaps starting with legislation itself, but it suggests a lack of regulatory judgment, which is rather unlucky.
Anti-money laundering rules have reached the furthest corners of English life. Alas, as we guard against wickedness in very small financial transactions in this country, there is a degree of quite significant capital flight out of the country going on. The timing of the Bill suggests that it may be the last chance for Parliament to set clear guidelines on proportionality before the next Government. Only Parliament can do this, because financial regulation will default to maximum caution in most instances, with consequences very clearly identified by noble Lords in the debate.
Clause 14 on AML, Clause 39 on ring-fencing, Clauses 16 and 17 on the five-year plans, and Clause 26 on changes to the senior management regime are all about proportionality. The Government’s own 2025 action plan recognises:
“Regulation can be too complex and duplicative”,
and that the cumulative effects of individually rational rules can impose significant burdens on business, smaller banks, challenger firms, wholesale firms and those caught by overlapping conduct and redress frameworks.
Your Lordships’ Financial Services Regulation Committee has also raised important concerns about whether aspects of the PRA’s capital approach may limit
“the commercial incentives and capital available to provide finance for growth”.
Overcalibration can reduce lending, particularly for SMEs, and productive investment, especially where requirements bear down on smaller, growth-oriented lenders.
The Bill touches on some of these issues of proportionality: reform of the Financial Ombudsman Service; simplification of the senior managers regime; faster application deadlines; and the consolidation of the Payment Systems Regulator into the FCA. Those are welcome steps.
We welcome the Bill. We hope that, through our deliberations in this House, we can help shape a Bill that restores confidence, competitiveness and momentum in our financial services industry for the wider benefit of our economy and our country.
Lord Stockwood (Lab)
My Lords, I thank everyone who has spoken in the debate for their valuable contribution. It has been an incredibly well-informed and courteous debate that, overall, recognised the balance that needs to be found to ensure that consumers are protected and risks are appropriately managed while avoiding an ever-increasing burden of regulation. Noble Lords have a range of views on where exactly that balance might be. In the time that I have, I will try to respond to as many of the points raised as possible. I will not be able to do justice to all the points raised today, but I have meetings scheduled with many people who have spoken. I reiterate that I am happy to meet anyone who would find it helpful to discuss any of the issues ahead of Committee.
As I have said, the Financial Services and Markets Bill will modernise how the sector is regulated. It will help the sector grow and lend more to businesses, and it will make consumer protections fit for the digital age. It will achieve these objectives while maintaining high standards of regulation and oversight. I remind noble Lords that this is why, as I mentioned when I opened the debate, the financial services sector contributes 8% of total UK GVA—although I have been corrected that TheCityUK estimates that, when related to professional services, this rises to 11%. We can all agree it is a substantial part of the UK economy.
The industry is a direct source of jobs and tax revenue, but it is, of course, much more than that. It is a key enabler of growth in other sectors, and it is the provider of payments, credit, insurance and investment services to households and businesses across the UK. A successful financial services sector is one that meets the needs of the broader economy and society at large, and that is what the Bill aims to deliver.
Before I turn to some specifics, I will set out the Government’s position on some of the broader points raised in the debate. A number of Peers, including the noble Baronesses, Lady Neville-Rolfe and Lady Noakes, asked whether it was appropriate to pass more responsibility to the regulators. FSMA 2000 gives the financial services regulators responsibility for making the detailed rules that apply to firms. The regulators operate within this regime set by the Government and Parliament, including a set of statutory objectives that they need to advance. As the noble Lord, Lord Burns, reminded us, this is a long-established approach and the Government believe that the regulators remain the most appropriate entities to make rules for the sector. Both the IMF and the OECD support the principle of regulators making rules independently from government. The delegation in this Bill is entirely in line with the approach that Parliament has repeatedly affirmed. The Government are in full agreement with the noble Lord, Lord Eatwell, when he notes that the success of the UK’s financial sectors depends in part on a highly respected system of regulation and strong, effective regulators.
The noble Baronesses, Lady Neville-Rolfe and Lady Bowles, also asked about the Government’s use of delegated powers, especially the power related to the banking services in Clause 3. The Treasury has submitted to the DPRRC a full delegated powers memorandum, which sets out the justification for each power. On Clause 3 in particular, the Government are taking this power now to ensure that we can respond swiftly to the independent review of access to banking services once it concludes. The Government are committed to keeping all aspects of the power under review as the Bill progresses through Parliament and as the independent review completes its work. We expect to narrow this power once the review is concluded.
On the matter of regulatory complexity, the Chancellor has been clear that the UK needs to regulate for growth and that regulation must be proportionate while adequately protecting consumers and ensuring we maintain the high standards we are known for around the world. This Bill targets unnecessary, burdensome regulation while maintaining those high standards, and we are focused on speeding up regulator decision-making and removing administrative burdens. The Government are committed to creating a regulatory environment that is proportionate and effective and supports growth. Good regulation also supports consumers. For example, the reform of the Consumer Credit Act is designed to ensure that consumers receive clearer and more useful information from lenders, empowering them to make better-informed choices on their finances.
The government framework is prescriptive and outdated. The literacy trust has found that one in seven adults has literacy skills at or below the level expected of nine to 11 year-olds, yet Fairer Finance has found that the reading age required for credit card providers’ materials is that of 11 to 20 year-olds. It is obvious that a simpler, more flexible regime, one focused on outcomes rather than rigid prescription, will enable firms to produce clearer, more accessible financial information, better meeting the needs of the significant proportion of consumers with lower levels of literacy or numeracy. The FSA has the experience to design the system to deliver this and the powers it needs to enforce compliance.
I have listened carefully to the concerns of the noble Baronesses, Lady Neville-Rolfe, Lady Noakes and Lady Gill, and others about changing the application of the regulators’ “have regards”, applying them to the long-term strategy rather than the day-to-day functions. It is vital that the regulators are subject to effective oversight and scrutiny so that Parliament can have confidence they are acting with the appropriate measures and achieving the outcomes required. Much like other areas of regulation that apply to firms, the reporting requirements on the regulator have developed over time and have sometimes laid on top of each other. What results is a detailed set of information, but there are also areas of overlap and duplication. To use a metaphor also used by the noble and learned Lord, Lord Thomas, at times it can be difficult to see the wood for the trees.
The changes will require the regulator to set out the regulation and supervision clearly, making it easier for Parliament and stakeholders to understand, engage with and challenge them. The “have regards” will remain in legislation. This will support the work of the Government and Parliament to hold the regulators to account, cutting out dense piecemeal reporting to focus on the bigger picture. The reforms will reduce unnecessary and duplicative burdens on the regulators, allowing them to speed up and focus on what is important while maintaining the important information needed for meaningful scrutiny. For example, the Bill will require the FCA and the PRA to continue to report annually on how they are advancing their competitiveness and growth strategies. This will support the Treasury’s biannual performance reviews held with the CEOs and the regulators, introduced as part of the Government’s wider regulation action plan.
I turn to reforms of the Financial Ombudsman Service—FOS. The Government are in full agreement with the noble Lord, Lord Sharkey, and my noble friend Lord Pitt-Watson about the importance of trust. It is essential that our regulatory system supports trust in the financial services sector and that people have confidence that they will be supported when things go wrong.
I can give my noble friend Lord Pitt-Watson the reassurance he asked for: when the FOS considers whether the firms have met their obligations under FCA rules, this will include principle-based rules, including the consumer duty. The new arrangements introduced by the Bill will bring in greater co-ordination between the FCA and the FOS and will mean that widespread issues can be spotted and addressed more quickly and effectively. For example, if the FCA spots that large numbers of firms are letting down their customers in a certain way, it can make the regulatory intervention to nip that issue in the bud, rather than waiting until consumers lose out.
I understand that some noble Lords have concerns about limiting claims to the FOS at 10 years. Concerns about potential long-term liabilities that are difficult to assess can hold back investment, making firms unwilling to invest or to serve certain consumer groups. However, historic complaints also pose significant practical challenges when we look at the lack of availability of relevant evidence on which to base a decision. The Government conducted a comprehensive cost-benefit analysis when designing this policy. Looking at recent history, only 11% of cases that are older than 10 years result in redress been paid, much lower than the overall rate. In order to assess these claims, the FOS has charged firms £18.1 million per year in case administration fees, while awarding only £600,000 to consumers, so the case fees are 30 times higher than the redress awarded.
However, I appreciate the point that some financial products are long-term by design, such as life insurance. Issues with these products may not come to light within the 10-year cut-off. so I am happy to assure my noble friends Lord Pitt-Watson and Lord Davies of Brixton that Clause 6 enables the FCA to make exceptions to time limit these types of products. This is aimed exactly at ensuring that holders of long-term products continue to be protected.
The noble Baroness, Lady Kramer, raised concerns that the Government are weakening the senior managers and certification regime. I assure noble Lords that this is not the case. These reforms are about improving how the regime operates in practice by removing unnecessary complexity to help increase efficiency and effectiveness while preserving the regime’s core focus on maintaining strong accountability standards. Firms will remain responsible for assessing the fitness and propriety of senior managers, and pre-approval by the regulators will still be required where regulators determine it necessary to advance their statutory objectives, targeting the regulators’ attention where it matters most. The regulators will continue to hold all senior individuals to account where standards fall short.
Where there is any tension between reducing the regulatory burden and maintaining high standards of senior-level individual accountability, regulators will be expected to prioritise the latter in accordance with their statutory objectives. Senior managers will remain responsible and accountable for the areas of their business that they oversee, including where they fail to take responsible steps to prevent regulatory breaches, regardless of whether they are approved or appointed.
My noble friends Lord Pitt-Watson and Lord Eatwell asked for assurances on the reforms to the ring-fencing regime. As I set out when I opened this debate, the independent review led by Sir Keith Skeoch in 2022 concluded that ring-fencing should be retained but recommended better alignment with the resolution framework. The Bill enables that alignment, meaning that the PRA will not need to duplicate efforts where protections are already delivered elsewhere, especially through the resolution regime. This fundamental safeguard—the separation of retail banking from riskier investment banking activities—is unchanged.
The Government will set out the wider reform programme in the ring-fence review, which will be published and will go beyond the measures in the Bill today. It focuses in particular on enabling ring-fenced banks to support growth, including consulting on a new growth allowance and expanding the range of products and services that they can provide to support UK businesses and the real economy.
My noble friend Lady Hodge asked a number of questions about the FCA’s new responsibilities for anti-money laundering, and I will try to answer them briefly. The Government are working closely with the FCA to ensure that it is ready and able to take on new responsibilities. On registration and legal privilege, the Treasury will shortly publish a response to the consultation on anti-money laundering supervision. This covers the FCA maintaining a register of supervised firms, access to legally privileged material and powers to ensure robust supervision during the transition period.
A duty of co-operation between anti-money laundering supervisors already exists in the money laundering regulations. OPBAS also has a censure power and can recommend that the Treasury strips PBSs of their supervisory role. The Bill provides authority to HMT to make payments to the FCA for proprietary work, therefore the FCA’s AML-CTF supervisory activities will be fully funded by fees paid by the supervised population. This funding for start-up costs will be fully ring-fenced for these purposes, and the Government intend for the FCA’s AML-CTF supervisory activities to be funded on a cost-recovery basis through its fee charges to supervised firms, consistent with the existing funding model. I expect the FCA to consult separately on the detailed structure and operating of these fees.
The noble Baronesses, Lady Young and Lady Hayman, and others raised sustainable finance. As they noted, the Government have clearly set out our ambition to position the UK as the leading hub for sustainable investment, leveraging our sustainable finance expertise to support transition and drive growth. The Government are working closely with the regulators to drive forward this ambition through work including the FCA’s recent consultation on aligning listed companies, sustainability disclosures with international standards, the launch of the Transition Finance Council and work to regulate ESG ratings. To answer the specific question of the noble Baroness, Lady Young, the Government consulted last year on how to implement our manifesto commitment to require financial services firms and listed companies to develop and implement credible transition plans. The Government are considering next steps and will respond to the consultation in due course.
I make the general point that noble Lords should not conclude that if something does not appear in the Bill, that means that the Government are not doing anything about it. The Government have a much broader programme of financial services work sitting alongside the measures in this primary legislation. I acknowledge the thoughtful questions from the noble Lord, Lord Kamall, the noble Baronesses, Lady Young of Old Scone, and my noble friend Lady MacLeod about business and community finance. In the interests of time, I will write to them following the debate. I will be happy to meet the noble Lord, Lord Holmes, to discuss the issues he raised related to technology and innovation. Finally, the noble Baroness, Lady Morgan, raised the important issue of economic abuse. Tackling economic abuse is a priority for the Government and a key theme of the financial inclusion strategy. Ministers will be happy to write to the noble Baroness with details of how we are working with industry, regulators and specialist organisations to tackle economic abuse and help victim survivors to regain financial independence.
I have rather breathlessly tried to answer as many questions as I can. I look forward to revisiting all these points in detail in Committee, and I beg to move.
Lord Stockwood
That the bill be committed to a Grand Committee, and that it be an instruction to the Grand Committee that they consider the bill in the following order:
Clause 1, Schedule 1, Clauses 2 to 13, Schedule 2, Clauses 14 to 31, Schedule 3, Clauses 32 to 53, Title.