Live Debate: Lords Chamber

Oral questions: Assessing the impact on bereaved families, confidence in pensions and future levels of pensioner poverty, of proposals to impose inheritance tax retrospectively on unused pensions and death benefits

Urgent Question Baroness Altmann. standing in my name on the Order Paper.

14:59

Baroness Altmann (Non-affiliated)

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My Lords.

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The government continues. To incentivise pension. Savings for their. Intended purpose of funding retirement, most unused pension

14:59

Lord Livermore, The Financial Secretary to the Treasury (Labour)

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retirement, most unused pension funds and death benefits payable from a pension will form part of a person's estate for inheritance tax purposes from the 6th of April, 2027. This removes distortions resulting from changes made over the last decade, which have led to pensions being openly used and marketed as a tax planning vehicle to transfer wealth rather than to fund retirement. fund retirement.

15:00

Baroness Altmann (Non-affiliated)

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I thank the noble Lord for his answer, but my question is whether the government has actually properly considered the real world impact of these unworkable proposals, with its aim to hit the minority of wealthy pension owners. This could actually damage millions of less well-off families, who will see a 40% cut in death benefits, especially if they are in a defined contribution scheme, much less so in defined benefit. A single parent with a house and children will lose out significantly.

And does the noble Lord recognise that this retrospective confiscation without transitional protection undermines confidence in long term planning, reduces long term investment and will lead to more people rushing to take money out of their pensions quickly, just in case they may face the inheritance tax, especially if they can take out thousands of pounds a year at just 20%, which will mean more pensioners in future in poverty. Despite the government's aim to get more people saving for a good pension.

saving for a good pension.

15:01

Lord Livermore, The Financial Secretary to the Treasury (Labour)

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I'm grateful to the noble Lady for her question. I think the short answer is no. Let's be very clear this is not a retrospective policy change. It takes effect for deaths on or after the 6th of April 2027. So that's in no way retrospective. And the examples that the noble Lady gives, I think it's important to be very clear that estates will continue to benefit from all the normal neural rate bands, reliefs and exemptions available so an estate can pass on up to £1 million with no inheritance tax, and spouses are fully exempt from inheritance tax.

So more than 90% of UK estates will continue to have no inheritance tax liability. Following these changes.

15:02

Lord Davies of Brixton (Labour)

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May I welcome my noble friend's clear statement that the purpose of a pension fund is to provide pensions, and not to assist the better off in estate planning. Does he agree with me, given the frequent press comment that inheritance tax is in many senses a voluntary tax, that it that anyone will be able to avoid paying a higher rate of tax with a modicum of planning. of planning.

15:02

Lord Livermore, The Financial Secretary to the Treasury (Labour)

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Well, I very much agree with my noble friends first part to his question, and I think it's very important to state that the intended purpose of pension savings is to fund retirement. The government continues to incentivise pension savings with tax reliefs on both contributions into pensions and on the growth of funds held within a pension scheme, and that these tax incentives are very significant, costing taxpayers £78 billion a year. And it is therefore right. As my noble friend rightly said, it's important to ensure these tax reliefs are being used for encouraging savings for retirement rather than ordinary taxpayers subsidising the wealthy

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to pass on their wealth free of inheritance tax. Rothman my Lord Wills does. Does the Minister agree that it

15:03

Lord Macpherson of Earl's Court (Crossbench)

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Does the Minister agree that it is an important principle of the tax system, that tax reliefs and tax system, that tax reliefs and therefore tax expenditures, should be tightly drawn? And does he also agree that the point of pension relief is to provide a pension in retirement, and therefore pension savers should draw down their pension rather than using it as a device to avoid inheritance tax and to improve the lot of their

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descendants rather than themselves. Yeah. I do agree with I think everything the noble Lord said. I

15:04

Lord Livermore, The Financial Secretary to the Treasury (Labour)

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everything the noble Lord said. I enjoyed discussing these matters with him when he was a Treasury official and I was a special adviser, and I probably learnt a lot of this from him, from him then. So I completely agree with what the noble Lord said. And just to repeat, the purpose of of pension savings is to fund retirement. If the taxpayers are spending £78 billion a year on that, it's very important that it's used for its intended purposes rather than estate planning, as the noble Lord says.

planning, as the noble Lord says.

15:04

Baroness Kramer (Liberal Democrat)

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Real life, that many people restricted their lifestyles and their spending and restricted their gifting in order to build a sufficient DC pension that could pay, if needed for years in a care home, not knowing how long they would live or their health conditions, and they didn't want to burden the state or their children, they now see that they were gullible for believing in assurances that anything unused could go to their loved ones free of inheritance tax, and that the government simply regards their sense of responsibility as rather stupid.

What would the Minister say to those people?

15:05

Lord Livermore, The Financial Secretary to the Treasury (Labour)

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Yeah. I'd say that the noble Lady is saying things that are completely misleading. As I've said already, estates will continue to benefit from all the normal nil rate bands, reliefs and exemptions available so an estate can pass on up to £1 million, £1 million with no inheritance tax and spouses are fully exempt from from inheritance tax. And I think it's just also important to say that we have equal treatment here. So there's equal treatment for inheritance tax purposes between pension and non pension assets.

And I think that is perfectly fair within the system.

15:05

Baroness Neville-Rolfe (Conservative)

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I speak as someone whose relatives have struggled for years rather than months in coping with the probate system, partly because the problems caused by the inefficiencies of the probate

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office executors will not be able to. Deal with. The extra complexity of adding

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The extra complexity of adding pensions to I, particularly those with lots of small pension pots. Now, my noble friend Baroness Now, my noble friend Baroness Altman, in her submission to our finance Bill Sub-Committee, has finance Bill Sub-Committee, has suggested a simpler mechanism for dealing with this and raising the

15:06

Lord Livermore, The Financial Secretary to the Treasury (Labour)

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necessary revenue. Would the government examine this sympathetically?

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I presume, and I will, lady is referring to the noble Lady's proposal for a flat tax, which I proposal for a flat tax, which I think is very interesting. Noble Lady raises this. Currently, fewer than 10% of estates will have an inheritance tax liability. If you put a flat tax on all pensions,

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put a flat tax on all pensions, then you are asking 90% of estates to pay more so that 10% of estates can pay less. I do not consider

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that to be fair. Yeah.

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Yeah. Interest charges for late payments of tax are charged at 8% payments of tax are charged at 8% per annum and apply to estates. After six months with the noble Lord, the Minister agree with me Lord, the Minister agree with me that given potential complications in finalising and executing wills, six months is rather short and that six months is rather short and that a longer period of grace period of at least one year should apply

15:07

Lord Livermore, The Financial Secretary to the Treasury (Labour)

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at least one year should apply before interest charges are levied. I do understand the point that

15:07

Lord Evans of Rainow (Conservative)

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I do understand the point that the noble Lord raises. As I understand it, six months is standard within the tax system.

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My Lords, the noble Lord. The Minister may recall this time last year I asked a question about pensioners who are coming up to the pensioners who are coming up to the time when their pensions are ready to be drawn down, and they're looking forward to the 25% tax free lump sum. Despite the noble Lords reassurances. Thousands of pensioners took their pension early. Can the noble Lord, the Minister, reassure those pensioners waiting to draw down their pension that there will be no changes to the 25% lump sum, tax free lump sum?

15:08

Lord Livermore, The Financial Secretary to the Treasury (Labour)

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I do remember the noble Lords question last year, as he knows I'm not going to speculate on the next budget now, and I'm not going to comment on individual tax measures ahead of time. My Lords, the noble.

15:08

Lord Forsyth of Drumlean (Conservative)

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Lord accept.

15:08

Lord Livermore, The Financial Secretary to the Treasury (Labour)

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Any kind.

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cash to pay it. Well, as I say, given that the or the given all the normal nil rate bands will continue to apply and the state can pass on up to £1

15:08

Baroness Altmann (Non-affiliated)

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and the state can pass on up to £1 million, as I say, with no inheritance tax. So I think if you're leaving £1 million, you probably have the cash to pay the

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tax. My Lords, I fully agree with the noble Lord that pensions should noble Lord that pensions should pension funds should be used to fund retirement. The point is, this is a retrospective tax because is a retrospective tax because people have already put the money in and made long term plans, of which now a significant proportion, which now a significant proportion, and sometimes the majority is being confiscated by HMRC if they are confiscated by HMRC if they are unlucky enough to die before they draw down.

The worry is about draw down. The worry is about people who are younger, not those who are deliberately avoiding who are deliberately avoiding taking their pensions. But people die unexpectedly young. Their families will lose out, their death families will lose out, their death benefits will be cut. And these are people who've made long term plans, people who've made long term plans, and I'm concerned about the impact on future pension savers who will on future pension savers who will think, well, the government might just come and take this money away from me.

I'm not going to invest it from me. I'm not going to invest it for the long run. Pensions is just not something I want to bother with. Even if they would not eventually Even if they would not eventually pay IHT. That is the problem. And why I was suggesting a flat rate levy which can recover some of the tax relief given on unused pensions, but still not impact the future. Confidence and pensions.

15:10

Lord Livermore, The Financial Secretary to the Treasury (Labour)

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Yeah.

15:10

Oral questions: Supporting an increase in the numbers training to be teachers of music, drama, art and design, and dance

Well, I think that all the points the noble Lady just raised have been covered in previous conversations. It's very clearly not a retrospective tax because it takes effect for deaths on or after the 6th of April, 2027. I've also dealt with the fact that a flat rate tax would mean that 90% pay more, so 10% can pay less. And I've also, I think, dealt with the fact that an estate can pass on up to £1 million with no inheritance tax due.

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Fourth oral. Question Baroness Keeley. My Lords, I beg leave to ask the

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My Lords, I beg leave to ask the question. Standing in my name on the Order Paper. My Lords, we're working with the sector to re-establish teaching as an attractive profession across all subjects, including the arts. This subjects, including the arts. This is why this government has increased teacher pay by almost 10% over two years, and is providing

15:10

Baroness Keeley (Labour)

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over two years, and is providing bursaries this year worth up to £10,000 for trainees in art, design and music. We are already seeing positive impact. The number of new trainees and teachers have trainees and teachers have increased significantly in arts and design and music over the past year. design and music over the past year.

15:11

Baroness Smith of Malvern, Minister of State (Education) (Labour)

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I thank my noble friend for that answer. The undervaluing of music in state schools by successive conservative led government since 2010 led to the loss of over 850 full time equivalent music teachers since 2011. High vacancy rates and poor retention rates of music teachers, with only two thirds of those who qualified five years ago still teaching now, and music teacher recruitment targets, which were missed 11 times in 12 years. So there's a great deal for the Labour government to do.

Sustained bursary funding for initial teacher training has been shown to show training has been shown to show more stable recruiting. So can my noble friend look at both reinvesting in the music teacher reinvesting in the music teacher training bursary and then sustaining it for a number of years, backed by Ministers, emphasising backed by Ministers, emphasising the central place of that music teacher bursary, not just science and maths. and maths. My noble friend is right that we are currently having to deal with the underinvestment in teachers of the last government and of course, as well the narrowing of the curriculum that limited students ability to be able to study music and art and design courses.

But we are making good progress. I'm pleased to say, on our pledge to deliver 6500 more teachers, the workforce has grown by over 2300, and we have a near record low number of pupils. Sorry, of teachers leaving the profession, but we do have to, when thinking about the additional funding that we provide in terms of bursaries, consider the current position with respect to recruitment. And I suppose the good news is that we've seen actually a 53% increase in people going into music teacher training, starting postgraduate teacher training in in the last year.

And for that reason, we have decided not to continue the bursary this year. But we are optimistic in figures that we've already seen and will publish in December that course acceptances indicate that this improved recruitment will be at least maintained. at least maintained.

15:13

Lord Berkeley of Knighton (Crossbench)

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As both the last government and this government have recognised the problem we have in getting teachers for music in particular, but also in the arts generally. So it is very disappointing that the bursary for music teachers, people wanting to train has been cut to zero in order for young people to follow on from people like the Beatles, all these people who brought a huge amount into the economy, we need to invest in the next generation, and that means teaching them to play instruments and to be able to become musicians of the future.

become musicians of the future.

15:14

Baroness Smith of Malvern, Minister of State (Education) (Labour)

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I, I completely agree with the noble Lord. That's why, as well as investing in all teachers and as I say, seeing results in terms of teachers coming into the profession, we're also making specific contributions through, for example, the funding of the over 40 music hubs that exist across the country to support the very best teaching of music, and of course, the Music Opportunities pilot, which will make sure that more young people, particularly those who are disadvantaged or who have special educational needs and disabilities, will be able to play an instrument or sing to a high standard.

15:14

Lord Mohammed of Tinsley (Liberal Democrat)

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Lib Dems.

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that in terms of creative. Subjects, that. There will no longer be. A privilege for the lucky few. So could.

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So could. I ask the Minister specifically. In relation to. Rural and smaller schools who

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Rural and smaller schools who often struggle to attract. Specialist teachers. In the creative subjects, how

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In the creative subjects, how they're going to actually deliver a full equality creative curriculum?

15:15

Baroness Smith of Malvern, Minister of State (Education) (Labour)

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Yeah. Yeah. Well, this is precisely why we

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Well, this is precisely why we need this 6500 new teachers into the profession in secondary and, and special schools that this government has committed to. And why not only committing, but investing is already delivering results in terms of the increased numbers of teachers that we're seeing. And it's why we also need to through the Music Hub programme, for example, that I talked about previously, make sure that. There is there are opportunities for teachers to understand the best way, in order both to teach music and to enable their students to have the joy that comes from understanding, enjoying music and playing instruments or singing.

instruments or singing.

15:16

The Earl of Clancarty (Crossbench)

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My Lords. schools where it all starts in, for example, music and art and design do not have specialist knowledge in those areas. So what importance does the government attach to having specialist art teachers in primary schools? And do they think gathering statistics on the numbers involved? These figures do not currently exist, would be helpful in getting to grips with this area? in getting to grips with this area?

15:16

Baroness Smith of Malvern, Minister of State (Education) (Labour)

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Well, as the noble Lord says in primary, quite often teachers will have a range of areas that they will that they will teach. So what's important there is that teachers have got access to the best understanding of how to teach music, supported through the music hubs. They've got understanding about the best quality, excellent arts teaching, which we will develop, for example, through the new centre for Arts and Music Education, and that they are being supported, for example, through the pay increases that we have put in place to actually enter the profession and stay in it.

15:17

Baroness Barran (Conservative)

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Lord Singh I'd like to follow on from the noble Earl, the Earl of Clancarty question. But before I do so, the noble Baroness, the Minister is very quick as ever to criticise the previous government and come out with various statistics. She did omit to mention, of course, that teacher numbers were at an all time high. When we left office. But in relation to specialist teachers, whether it be in art or music or drama or the other subjects that have been mentioned in this question, one way to get the kind of specialism to which the noble Earl refers would be to allow those without qualified teacher status to continue to deliver, those being able to bring their specialism in these areas.

And I wonder whether that's something she would reconsider in the context of the bill. Yeah. the context of the bill. Yeah.

15:18

Baroness Smith of Malvern, Minister of State (Education) (Labour)

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Well, I believe that good teachers bring a specialist knowledge and the particular skills that Titus brings alongside it, which is why I think pupils have an entitlement to ensure that those teaching them have both the specialism and the teaching specialism in order to give them the best possible opportunities. That's the reasoning behind this government's determination that all pupils should have the entitlement to a qualified teacher in the classroom in front of them, because, as we know, the quality of teaching is the single most important school.

15:19

Lord Wigley (Plaid Cymru)

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Does the noble Lady, the Minister, accept that the most important driver in this were if every single primary and secondary school should have access to a professional music teacher, be that full time, part time, peripatetic or distance learning. If that were to happen, that would create the demand for teachers and that would lead to the necessary supply. And in asking this question, I draw attention to my interest in my wife is a harp teacher. is a harp teacher.

15:19

Baroness Smith of Malvern, Minister of State (Education) (Labour)

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Well, I'm sure the noble Lord's wife is doing an enormously important job in developing an interest in art in in the pupils that she is teaching. Of course, we need to make sure that we have the qualified teachers with access to support for the specialism that, for example, the government's new National Centre for Arts and Music Education will be aimed at providing for them in order to ensure that all children, not just fortunate children, have the opportunity to benefit from arts and music.

And that's what this government is putting in place.

15:20

Baroness Bousted (Labour)

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This Lord Alderdice. Agree that the recruitment of qualified teachers is clearly essential, and the government has made great strides here in the picture. Recruitment looks much better this year than it has done in the past ten years. But would you also agree.

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That the. Retention of mid-career teachers is equally important? The report of the Teaching Commission, which I the Teaching Commission, which I chaired, Shaping the Future of Education, revealed that it now takes ten newly qualified teachers to replace every seven more experienced teachers who leave teaching before retirement. Does the Minister agree that this trend the Minister agree that this trend must be reversed? If we are able to maintain educational standards and

15:21

Baroness Smith of Malvern, Minister of State (Education) (Labour)

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a broad and balanced curriculum, including the arts? My noble friend is absolutely

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My noble friend is absolutely right. And, you know, I thank her for the the work that she has done to support teachers throughout her career and continues to do now with the work that she was alluding to. Not only do we need to get teachers into the classroom, but we need to keep them in the classroom, and I'm pleased that this government's investment in teachers through pay, yes, but also through broader support in the classroom, has not only brought more new teachers into teaching, but also reduced those leaving the profession to one of

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the lowest ever levels. My Lords, that concludes our questions for today and any member who wishes to leave the chamber now

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Lord Lord Lilley Lord Lilley now Lord Lilley now come Lord Lilley now come to Lord Lilley now come to an instrument previously debated in Grand Committee. Environmental Protection (Wet Wipes Containing Plastic) (England) Regulations 2025 Baroness Hayman of Ullock. Baroness Hayman of Ullock.

15:22

Business of the House

My Lords, I beg leave to move that the motion standing in my name

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on the Order Paper be approved. The question. Order.

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Order. The question is that this motion be agreed to. As many as are of that opinion will say content, the

15:23

Legislation: Border Security, Asylum and Immigration Bill - third reading

that opinion will say content, the contrary not content. The contents have it. Third Reading of the Border Security, Asylum and

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Border Security, Asylum and immigration Bill, the Lord Hanson of Flint. My Lords, I beg to move the bill. Be now read a third time.

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Be now read a third time. The question is that this bill be now read a third time. As many as are of that opinion will say

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as are of that opinion will say content the contrary, not content. The contents have it. My Lords, I beg to move that the

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My Lords, I beg to move that the bill do now pass. My Lords, before we conclude the Lords stages of the Bill, I just wish to express my

15:23

Lord Hanson of Flint, The Minister of State, Home Department (Labour)

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Bill, I just wish to express my deep sadness following the news last week of the passing of the noble Baroness Newlove. I want to, on behalf of the Home Office, praise her dedication and work for supporting victims from drawing on her personal experience as Victims' Commissioner. I'm sure the whole House will join me in sending condolences and thoughts to the noble Baroness, family and friends at this time. My Lords, before I just come on to the Bill itself, I just want to say that the bill has been subject to many hours of debate across this House, and I thank all peers for their contributions.

The bill was introduced in the House of Commons back in January of this year, and is part of a serious and credible plan to protect the UK border security that sees the government working very closely with our international partners and with the colleagues across this country to ensure that we ensure law enforcement and have the powers and tools that we need to identify, disrupt and dismantle organised crime. The bill is about protecting those who need it swiftly, removing those with no right to be here and cracking down on criminal gangs.

And it establishes landmark new offences which deliver on manifesto commitments on counter-terrorism powers that will give law enforcement the ability to tackle those involved in putting lives in danger and threatening border security. It also establishes the new border security commander, about which we've had much discussion during debate in this House. Also, the government has introduced a new offence to criminalise those who advertise illegal migration services online and through social media. And we've also listened to your Lordships' House and to the Constitution Committee and Joint Committee on Human Rights, and amended the new offences in the Bill where appropriate.

And these proposals, alongside the Asylum Policy Statement being announced today by my right hon. Friend the Home Secretary are important matters, and I just want to thank all noble Lords who've tabled and spoken amendments during the passage of this bill. I just want to also, if I may, just give thanks to the Ministers in the Northern Ireland, Scottish and Welsh governments who have seen and supported the relevant provisions in the Bill and have had legislative consent from each of the relevant parliaments and assemblies.

I also, if I may just wish to thank the Bill team genuinely without who this bill would not be possible and my officials in the private office, my Lords, the passage of this bill by this House is an important step to develop and strengthen the UK's border security, and I beg to move the bill. Do now pass.

15:26

Lord German (Liberal Democrat)

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The question is that this bill

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do now pass. And. My Lords, before I begin, can I echo the.

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echo the. Thanks that the noble Lord has made to his Bill team and also to thank him, because in the timing of this bill, the I can't recall the number of meetings which the number of meetings which the Minister has had with officials and members who have raised particular issues. Now, that doesn't mean to issues. Now, that doesn't mean to say that those meetings resulted in satisfaction for all those who are making the comments that they were and seeking them, but the fact that we were given those opportunities, we were given those opportunities, I think, is respected throughout this, throughout this House.

My Lords, it would be foolish to say that this bill marks a passing of an end point in in the immigration an end point in in the immigration and asylum seeking services of this country. We are told that we are country. We are told that we are about to have two statements, one today from the Home Secretary and one on Thursday, which will also one on Thursday, which will also deal with taking this matter further forward. It's rather like having the London bus coming along having the London bus coming along and then suddenly you've got more than one, and this is probably going to end up that we're going to going to end up that we're going to be in the in what is now becoming an annual event, which will be a new immigration bill.

And we we expect that to happen. And the question I have, first of all, to the Minister is, of course, you know, many of these issues that have been raised in the in the background to the statement, which is going to be made virtually at this time, I think, in a few minutes time in the other place have been made within the course of the debate on this bill. And so can I ask the noble Lord, the Minister, whether or not any amendments are going to be attached to this bill in order to give some speed to the Bill's passage of the questions which are being raised in the two statements that we're hearing today.

I would hope the answer to that is no, and that we actually don't for this bill properly, in a manner which is before us. I think we could say safely that what the bill has done, of course, is set out three distinct approaches from from the Labour government. It was a sort of pragmatic, law enforcement led control. The conservative opposition demands a policy of absolute deterrence based upon previous legislation, and we on these benches seek to balance necessary enforcement with safe, legal and humane routes, ensuring that international obligations are fully codified and respected.

In essence, a policy of control and compassion, which I think both go together. I think at the very outset of this bill, we laid out our concerns that it was dealing with only the really the supply side, which is the smugglers. These are the as long as the smugglers have have, have customers, then that is the problem which this side of the equation was being dealt with. But of course, our belief, and I hope that we will be proven that on Thursday's statement rather than today's statement, that the demand side needs also to be looked at appropriately.

And we are told that the proposals outlined today are that if you are more harsh on those making irregular routes, then this will stop people taking the dangerous journeys. And that's what this bill has been about, trying to reduce the and put a stop to the dangerous journeys which people are taking. That debate will now proceed because there are now the questions around the demand side issues which which the I understand the government is going to make. So in passing this bill, it seems to me appropriate that we've all had a learning experiences which are all going to be very useful for at least the next 12 months as we proceed to the next stage.

And perhaps a noble Lord, the Minister, say, are we going to have one in the year after as well? But I hope, I hope that given the strengths that he he has demonstrated, the amount of time that he's put in, the amount of time he's having to put into another bill, at least I hope he will have some respite over Christmas. But in so giving, so can I also thank those on my side who have been helpful to us in making sure this bill is being debated fully.

My colleagues Baroness Brinton, Baroness Hamwee and Baroness Ludford and Lord Oates, and also to Elizabeth Plummer in our office and here in Parliament. But I with that I thank the noble Lord, the Minister and and the his team behind him for their helpful way they've dealt with this bill.

15:31

Lord Cameron of Lochiel (Conservative)

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My Lords, it has been a long time since this bill was introduced in the other place, and since then much has happened. The government has brought forward the Immigration White Paper detailing changes to the immigration rules. They have established a one in, one out agreement with France, which has so far returned just over 100 migrants. Meanwhile, since that deal was announced on the 10th of July, almost 18,000 people have crossed the channel in small boats. We know the government is now bringing forward new measures relating to the asylum system.

We will have the opportunity to debate those once the Home Secretary has announced the full details today in the other place, but many of the plans have been trailed already, and it is evident that new legislation will be required to implement a number of those changes. The point is, my Lord, that events have moved at such a pace that this bill feels out of date before it has even become law. The Prime Minister has smashed the gang's pledge, has fallen flat so much that the government appears to have ditched the slogan.

But as we have consistently said, simply going after the gangs will not work. What is required is a credible deterrent. But unfortunately, as we know, this bill repeals the Illegal Migration Act 2023 and the Safety of Rwanda Act 2024. We put our plan to the House, and it is a shame that the government and the Liberal Democrats appear to us unwilling to take the action necessary to put an end to the small boats crisis. That being said, I am pleased that we were able to amend the bill in a positive manner.

My noble friend Lord Jackson of Peterborough, who sadly is not in his place today, has been pushing for the Home Office to release data on overseas students for a long time now. His successful amendment to the bill requiring the publication of those statistics is very welcome, and I hope the government will finally listen and agree to publish that data. It's also welcome that the government agreed with me that the new offences, in clauses 13 and 14 contained gaps as originally drafted, they didn't cover possession with intent to supply an article for use in immigration, crime nor handling by third parties.

And I'm very pleased the government took this on board and brought their own amendments forward. Finally, can I thank the noble Lord, the Minister? Well, I do not share his enthusiasm for this bill. I do know how hard he has worked to steer it through your Lordships' House. His willingness to meet members of this House privately, and can I extend my thanks to the Bill team and all noble Lords who contributed, particularly my noble friends, Lords Harper, Lord Murray of Blidworth, Baroness Lawlor, Viscount Goschen and Baroness Maclean of Redditch.

And I'm also grateful to all noble Lords who supported our amendments both at committee and report, particularly the noble Lord Lord Fox and noble Baroness, Lady Fox of Buckley. To conclude, my Lords, the government did have the opportunity, in our view, to take serious steps to fix the crisis in the asylum system. With this bill, they could have banned illegal migrants from getting asylum. They could have committed to detaining and removing anyone who enters illegally, and they could have committed to supporting all foreign criminals.

Unfortunately, they have not. And we will have to wait and see what new ideas the government brings forward and whether they will have any real impact. Because the Home Secretary was right when she said illegal migration is tearing this country apart. It is well past the time to take the comprehensive action necessary to protect this country's borders.

15:34

Lord Hanson of Flint, The Minister of State, Home Department (Labour)

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I'm grateful to both His Majesty's opposition and to the Liberal Democrats for their contributions in this debate. We've had some differences, but I think they will both accept that the government has a plan which is trying to deliver on its manifesto commitments, and where there are additional proposals being discussed, which are now being outlined very shortly in another place, they will form in answer to the noble Lord German proposals, not part of this legislation, but I will be outlining further the government's approach once my right hon.

Friend has made her statement during the course of today, I want to thank both noble Lords from the front benches for their contributions. They've helped generate discussion on this bill. And may I just say finally, that as well as the Bill team and my private office and my two colleagues on the government bench today from the whips Office have provided stalwart support, and I want to also place on record my thanks to the Chief Whip for ensuring that in this bill, only one defeat took place from the government, which I think is on an issue as contentious as immigration is, is a matter of of some joy for the government and some frustration, undoubtedly for the opposition.

But

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I do now commend this bill to the House and urge that this bill do now pass. Question is that this bill do

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Question is that this bill do now pass. As many as are of that opinion will say content. Yes, the contrary not content, but contents contrary not content, but contents have it consideration of Commons amendments and reasons on the

15:36

Legislation: Employment Rights Bill – consideration of Commons amendments and/or reasons (day two)

Employment Rights Bill, the Baroness Lloyd of Effra.

15:36

Baroness Lloyd of Effra, Parliamentary Under Secretary of State (Department for Science, Innovation and Technology) (Labour)

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My Lords, I beg to move motion A that this House do not insist on its amendment one b to which the Commons have disagreed. For that reason 1CI will also speak to motion C and c one. In this group we will be debating the amendments relating to zero hour contracts and seasonal work. I will first spoke to motion A relating to amendment one B, which was tabled by the noble Lord Lord Foulkes. The amendment would require employers to write to workers at the end of each reference period, explaining the workers right to receive the guaranteed hours offer and giving them the option to accept or decline.

I would like to take this opportunity to once again thank the noble Lord Lord Fox for his contribution throughout the Bill. We agree on many of the fundamentals relating to the security of work, and we have commonality in wanting to protect workers from precarious employment. I recognise the intent and sentiment behind the amendment is to ensure a balanced and practical approach, and I share the noble Lords desire for this bill to work for businesses and workers alike. I look forward to further conversations with the noble Lord on this matter and beyond, when we will continue our programme of consultation to ensure the Bill's measures are delivered effectively and proportionately for business.

The amendment is drafted, however, would alter fundamental aspects of the bill. We are building an economy based on fair competition between businesses, greater productivity in the workplace, job security for workers and fair reward for hard work. We need to tackle exploitative zero hours contracts that leave some staff unable to plan their working lives or manage their family finances. The provisions in this bill do that. We appreciate that some groups value the flexibility that zero hour contracts can provide.

These workers will be able to decline a guaranteed hours offer and remain on their existing arrangements, if that works best for them. My Lords, I hope you agree that ending exploitative zero hours contracts and providing security for the workers who need it most is imperative. Now, my Lords, I will speak on motion C relating to amendment 48 B, which was tabled by the noble Lord Lord Sharpe of Epsom. The government is fully aware that work in certain sectors fluctuates throughout the year, and we recognise the importance of these sectors.

That is why consideration of seasonal work is built into the right to guaranteed hours. Provisions. There are several ways in which an employer could approach seasonal demand. One approach would be to use would be to using annualised hours contracts, which allow employers to vary the number of hours worked at different times of the year. Some businesses already use these contracts, ensuring they can account for fluctuating demands in work when planning, while enabling workers to plan for household budgeting.

Additionally, the bill has already drafted allows guaranteed hours offers to take the form of limited term contracts where reasonable. The bill also provides powers to address seasonal work through regulations, ensuring flexibility as needs evolve. We will consult with employers, trade unions and stakeholders before making regulations. It is paramount that stakeholders are engaged with before we make these necessary decisions. Through the introduction of the new right to guaranteed hours, work will become more secure and predictable. It will leave workers in some of the most deprived areas less exposed to the hidden costs of insecure work, which can add up to as much as £50 a month for some, while strengthening the foundations that underpin a

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modern economy. I beg to move. The noble Baroness is enthusiasm got the better of her because I got the better of her because I hadn't actually put the question that the amendments and reasons be now considered. I hope the House will take it that we did so do, will take it that we did so do, even though we didn't say it. The question is that motion A be agreed

15:40

Lord Fox (Liberal Democrat)

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to? Motion A one Lord Fox. I thank the Deputy Chair for his

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I thank the Deputy Chair for his guidance, expert guidance. My Lords, I beg to move motion A1 as an I beg to move motion A1 as an amendment to motion A leave out from House to end and insert do insist on its amendment one be my Lords. Your lordships could be excused for a sense of deja vu, perhaps because we're back in your Lordships' House with the same issues we discussed on the 28th of October. They remain unresolved, indeed not addressed in any meaningful way.

Since the last very similar session of ping pong, I had a very engaging meeting with the Lords, Ministers and their officials, and I thank them for that meeting. The prospect of that meeting set a gave me a sense of anticipation. I expected some sort of legislative rabbit to be pulled out of the government's hat at this point. But no, there was nothing. And at first, my Lords, I thought there was something substantive being concealed for tactical reasons, perhaps ready to be flourished in some dramatic prestige at the moment that pleased the Ministers.

But it's become increasingly clear that not only is there no rabbit in the care of the benches opposite, there is actually no hat. If there is a hat, it exists elsewhere. And for that I have some sympathy for the minister's opposite, because they sit bareheaded at the moment with nothing to offer. Time has passed, however, and if the government's position hasn't changed, what has? Well, my Lords, the business environment has got worse. September saw negative growth in GDP.

Per capita productivity fell in the past quarter, and unemployment rose to 5% as recruitment cooled. And yet this ping pong represents a doubling down. But for what, my Lords, the government's manifesto vowed to make work pay. And we agree with that. None of these amendments can confound this. My amendment A1 does not in any way dent the worker's right to convert zero hours to guaranteed hours. What it does do is streamline the administration of that right. I explained last time. A1 merely avoids unnecessary work helping SMEs who have limited administrative capacity get on with the focus of growing their business and hopefully creating more jobs.

But in the absence of an amendment in lieu today, I will insist on this. Moving on to the noble Lord Sharpe amendment motion C1, we have consistently raised concerns about seasonal work, and I welcome the Minister's very careful description of the issues within the current legislation. The problem being, of course, there is outstanding consultation and outstanding details which make it difficult. My Lords, we are not 100% happy with the noble Lords drafting, but we feel it is a starting point for further conversations of the nature that the Minister just brought up were the we will support motions C1 if it is voted.

My Lords, the way to sort the impasse on these motions and those in subsequent groups requires political gumption. And in the end, I suppose it will be up to number ten. And I understand they might be preoccupied with other issues at the moment. I close with just one last statistic, this time from the Work Foundation at Lancaster University. There are now 1.79 million people out of work and looking for a job. With the economic inactivity stable at a staggering 21%, the number out of work appears to be rising, not due to increasing inflow, but rather due to limited outflow caused by difficulties in finding work.

1.79 million people, my Lords, my Lord, the government did not address the arguments we put two weeks ago and therefore it deserves the same response as last time. I beg to move A1.

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The original question was that

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The original question was that motion A be agreed to? Since when? Motion A. Order, order Lord Oates.

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Order, order Lord Oates. Since when motion A1 has been moved as an amendment to motion A moved as an amendment to motion A leave out from house to end and insert to insist on its amendment insert to insist on its amendment one be. The question, therefore, is

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that motion A one be agreed to? As Lord Fox.

15:45

Lord Leigh of Hurley (Conservative)

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15:50

Lord Hunt of Wirral (Conservative)

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15:55

Baroness Lloyd of Effra, Parliamentary Under Secretary of State (Department for Business and Trade) (Labour)

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focus sessions with SMEs specifically to look at the practical implementation, to understand any challenges and make understand any challenges and make sure we give the right guidance. I'd also like to just reflect on the point about business regulation the point about business regulation and the 25% target that we have. We have now established a baseline for have now established a baseline for the administrative burden, and the 25% target is about ensuring that regulation is proportionate, regulation is proportionate, efficient and works for business.

It's not about blocking regulation that is needed to deliver the that is needed to deliver the government's priorities. So we want to implement the this employment rights bill in a way that delivers rights bill in a way that delivers the intent, but in an efficient way as possible. For example, the Fair Work Agency is going to be consolidating the functions of the Gangmasters and Labour Abuse Authority, the Employment Agency Authority, the Employment Agency Standards Inspectorate and the director of the Labour Market Enforcement into a single body.

So Enforcement into a single body. So we are we are reforming as we go ahead with, with all of these, ahead with, with all of these, these measures. And we do believe that fundamentally this is about that fundamentally this is about balance. The noble Lord, Lord hunt, raised the issues of seasonality. Let me reassure the noble Lords that the government is fully conscious of the need to take account of the fluctuations in seasonal demand, while ensuring that workers are not the ones left holding all the risk.

And under the bill, there are several ways that an employer could approach seasonal demand while upholding the new rights, depending on circumstances. And I set out some of those in my my opening speech at the beginning. But they could be limited term contracts or guaranteed hours in various ways, such as an annualised hour contract. But we do think it is important to continue to consult on this on this issue of seasonality. Let me also just mention the point about about growth.

We have seen a huge amount of progress in terms of foreign direct investment, in terms of trade agreements. We are very we are very keen to continue to promote the economic prospects of the country. And we think this is fundamental to improving the productivity of the labour market. So with conclusion, I thank the noble Lords for their contributions today, and I look forward to further discussions on these on

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these issues. She. She says she's had

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She. She says she's had consultations with representative bodies of industry and commerce, by which I assume she means the FSB, which I assume she means the FSB, the IOD, the CBI. Would she like to give us a flavour of those conversations and in particular, conversations and in particular, identify any organisation which has given wholehearted support to this bill? CAID.

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Yeah. I mean, we of course, have had

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I mean, we of course, have had many discussions and have been amendments, amendments in the bill during the passage of it as a during the passage of it as a result of some of the consultations with with all social partners as we've gone through. So we have made amendments to the bill at Report stage. We've made them in respect stage. We've made them in respect of fire and rehire, in respect of the school sport negotiating body. the school sport negotiating body.

All sorts of of changes have been made. All kind of amendments have been made through the consultation been made through the consultation process. So and I would just say that in terms of the implementation, that in terms of the implementation, we have also set out a very, very clear plan for implementation so that it is very clear each that it is very clear each milestone is there. There's a consultation before that so that all businesses, large and small,

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can have the right amount of time to prepare and to get the guidance they need to implement these measures. Yeah.

15:58

Baroness Lane-Fox of Soho (Crossbench)

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Yeah. My Lords, I thank the the noble Minister for her response. I think I very welcome the objective that she set out of reducing red tape. I would remind her that this bill contains 170 Statutory Instruments, in my experience, as the Statutory Instrument leads to at least one regulation. So perhaps when when regulation. So perhaps when when next the Baroness is standing up, she can commit to retiring at least she can commit to retiring at least one, if not two, regulations for each one.

The Statutory Instruments each one. The Statutory Instruments bring in on on the tail of this bill, if indeed it ever becomes an bill, if indeed it ever becomes an act. My Lords, the the the noble Lady also talked about moral duty on the subject of zero hours, and I on the subject of zero hours, and I share that moral duty and nothing in amendment A1 resiles from that in amendment A1 resiles from that moral duty. And on that basis I would like to test the will of the House.

15:59

Lord Fox (Liberal Democrat)

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Yeah.

15:59

Division: A1

16:11

Amendment:B Lord Collins of Highbury (Labour)

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Lord Oates. I beg to move motion B that this house do not insist on its amendments. 23 and 106 to 120 to which the Commons have disagreed and do agree with the Commons in and do agree with the Commons in their amendments. 120 C, 120 D and their amendments. 120 C, 120 D and 120 E in lieu of Lords Amendments 23 and 106 to 120. I will also 23 and 106 to 120. I will also speak on motions E, E, one F and F1.

My Lords in this group were debating amendments relating to unfair dismissal, trade union industrial action ballots and political funds. These are areas clearly linked to our manifesto commitments, which the government has an electoral mandate to deliver, and I would like to thank all members of the House for their engagement on these areas throughout the passage of the bill, and we have listened carefully to the concerns raised and in response,

16:12

Government Spokes. Lord Collins of Highbury (Labour)

wherever possible, we are offering amendments in lieu that we believe strike a fair and workable compromise to the amendments made to the Bill. It may not be the rabbit that the noble Lord Lord Fox expected, but we are and we are. I would like to make it absolutely clear to the House none of the amendments tabled by the government will compromise the fundamental principles of the Bill, nor is it its intended impact which, as I would repeat, a commitment made in our manifesto.

Can I first start in relation to motion B, amendments 120 C, 120 D and 120 E tabled by the government? In the other place, we absolutely remain committed to delivering unfair to delivering unfair dismissal protections, ensuring that around 9 million employees who have worked for their employer for less than two years are protected from being arbitrarily fired. That's the principle we're addressing here now. The government has listened to

16:13

Government Spokes. Amendment:B Lord Collins of Highbury (Labour)

stakeholders, and it's tabled an amendment in lieu in the other place, which ensures that the government consult on key aspects of the framework. This will ensure that there is a direct input from both employers and employees, enabling businesses to shape the legislation and ensuring that it is practical and proportional. And I would like to reiterate what was said in the other place. Day one protection from unfair dismissal will not remove the ability of businesses to dismiss people who cannot do their job or pass a probation period, but it will tackle cases of unfair dismissal where hard working employees are sacked without good reason.

That's what this bill is about a six month qualifying period threshold still leaves employees exposed to arbitrarily being fired during the early months of their new job. As we have said from the start, the implementation of day one unfair dismissal rights will be done with a light touch. There is a power in the bill to modify the test when employers can fairly dismiss employees during the statutory probationary period for specific reasons related to performance and suitability, the government will consult on our approach to ensure it has maximum flexibility so that the new framework works effectively for employers and employees.

The cost of its implementation and operation. Now, can I turn to motion F and amendment 62 C, tabled by the government in the other place relating to the 50% turnout threshold for industrial action ballots, as the period of disruption between 2022 and 2024 has shown, unnecessary red tape on union activity works against the core negotiation and dispute resolution that we all seek. Bureaucratic hurdles do not prevent strike action, only make it harder for unions to engage in the bargaining.

That settles dispute. And that is actually what our commitment to do in this bill in terms of ensuring the promotion of growth, the repeal of the 50% turnout threshold, also aligns union democracy with other democratic processes. And we should not forget that, such as parliamentary votes and local elections. But we do recognise concerns on turnout, and I'm grateful for the conversations I've had with the noble Lords opposite, including, of course, my noble brother. But I think it's absolutely right that we address those concerns, and that's why we tabled an amendment in lieu in the other place, which will require the Secretary of State to have regard to any effects of the introduction of non postal balloting, such as electronic balloting, on the proportion of those entitled to vote in industrial action ballots who actually do so.

That will be the test of removing that 50% threshold, and I hope the noble Lord opposite will understand our commitment. Our commitment is to ensure that there is effective turnout. My Lords, I now want to speak to motion E and amendment 72 C, tabled by the government. In the other place which relates to political funds. And I will also speak to motion E1 relating to the noble Lord Lord Burns amendment in lieu. And can I start by thanking the noble Lord for his engagement with me on this area, particularly ensuring that we both understand our respective positions? But I think I made it clear to him we cannot accept his latest amendment in lieu.

They effectively retain something similar to the arrangements in the 2016 act, as members will only be deemed to be a contributor to the political Fund if they opt in making these contributions, forcing members to make a choice to either opt out or opt in or opt out on the application forms, otherwise preventing them from joining a union if they do not do so. And that's an additional burden on unions. What we are doing in this bill is simply returning to the situation as it was prior to the Trade Union Act of 2016.

The noble Lords Amendment would also block the the government's delivering on that commitment to repeal that act. Now, we are, we are reinstating the long standing practice that existed for 70 years before the passage of the 2016 act, including that operated during the Thatcher and Major administrations. And I want to absolutely reiterate, as we have in previous debates, we are not removing choice. New members are opted in on the basis that they are actively joining a voluntary organisation, an organisation that has structures to determine policy, determine actions.

That's what they're doing. And a political fund that has already been established via a Democratic ballot of its members. Once part of the union, these members have control how the political fund is used through the same democratic structures, including on questions of union affiliation or financial support to political parties. That is absolutely clear. But what we have been very clear about, too, we have been careful to draft the bill to ensure that at the point of joining, every new member will be clearly informed on their application form that they have the right to opt out of that political fund, contributing to that political fund.

They can do this when joining or at any time afterwards. The same form will make it plain that opting out has no negative bearing whatsoever on any aspect of their union membership. These requirements for application forms must be set out in the rules of the Union, the operator, political fund and union rules are subject to for, from for approval from the certification Officer. Exercising the right to opt out will not be onerous. The bill specifies the union members are able to provide an opt out notice in various forms, including by post email, completion of an electronic form, all the modern ways CPD ways of communication that we now expect.

Today's and these options for opting out must also be included in the rules of the Union. The government has also tabled an amendment in lieu in the other place, which takes into account how opt out notices would take effect to ensure that unions can process these opt out notices as quickly as possible. Under amendment 72, opt out notices will now have the effect on either January the 1st or the following year after it's been provided, or on a day specified or determined in the rules of the Union.

Whichever these dates comes first, and this provides unions with flexibility under the legislation to act more quickly and process a member's request to opt out without having to wait until the subsequent 1st of January to do so. We are committing to engage with unions directly to continue to make clear our expectation that opt out notices will be honoured as swiftly as practical as possible. My Lords, I beg to move the motions in the name of my noble friend Baroness Lloyd.

16:22

Lord Sharpe of Epsom (Conservative)

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The question is that motion be be agreed to motion B one Lord

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Sharpe of Epsom. My Lords, I beg to move motion B-1 as as an amendment to motion B, B-1 as as an amendment to motion B, leave out from house to end and insert to insist on its amendments

16:22

Amendment:B1 Lord Sharpe of Epsom (Conservative)

insert to insist on its amendments 23 and 106 to 120. And do disagree with the Commons in their amendments. 120 C, 120 D and 120 E. My Lords, I'm very grateful to the Minister for outlining the government amendments and also for the noble Lords Opposite's willingness to meet. But, my Lords, to say that the amendments that have been offered are inadequate would be something of an understatement. In essence, it obliges the Secretary of State before making regulations, and, I quote, to consult such persons as the Secretary of State considers appropriate.

My Lords, who might those persons be? And that really is the extent of the amendment. We already know that so far, government consultations with business on this bill have been desultory at best. My Lords, I don't believe that amendment even qualifies as a bunny. Never mind a rabbit, my Lords, the chorus of disapproval for this proposed legislation has now been joined by Labour's most successful ever Prime Minister, Sir Tony Blair. As my noble friend Lord Leigh of Hurley pointed out, and to expend on my expand on my noble friend's remarks in their report, his foundation said, and I quote, at present, employees gain protection from unfair dismissal after only only after two years.

One of the longest qualifying periods in the OECD, the bill would move to the opposite extreme, granting such rights immediately. This would raise employment costs by increasing the legal and procedural risks attached to every new hire, and discourage firms from recruiting, a concern already raised by some of the UK's largest business groups, which have urged the government to amend the bill. End quote, addressing the government's intention to introduce regulations allowing an initial probationary period during which an employee could be dismissed under a light touch process, the institute said and I quote again, uncertainty over what rights apply during probation will do little to reassure employers nervous about taking on staff.

Introducing a six month qualifying period for unfair dismissal protection, which is more typical amongst advanced economies, including across much of northern Europe and Australia, is more likely to balance fairness. Fairness with flexibility. Meanwhile, my Lords billionaire Labour backer John Caldwell put it rather more succinctly. He said this will make Britain and I quote, less investable. And he continued it's not good for Britain, it's not good for workers. Spot on. So to summarise, my Lords, we have multiple business groups against this and perhaps we should recap who they are.

The Federation of Small Business, the CBI, the Institute of Directors, make UK, the aerospace Defence and Security Group, the British Retail Consortium, Care England, the Chartered Institute of Personnel and Development, Family Business UK, the Recruitment and Employment Confederation, UK hospitality and the British Chambers of Commerce contacted me after the last debate to explain they would have signed the letter but were too late. My Lords, academia has added its voice to the chorus of disapproval. Professor Jonathan Haskell of Imperial College and a former member of the Bank of England's Monetary Policy Committee, said and I quote, using the OECD Index of Employment Regulation, there's a negative relationship, which is that more employment regulation means less intangible investment.

My best prediction is that the employment Rights bill is for the Employment Rights Bill is a rise in uncertainty for firms, and the reason is that these employment rights are set out in broad outline in the bill, but will then end up being interpreted by the courts, end quote. So they're all joined by the government's favourite think tank. As we discussed last time, the Resolution Foundation. And lest we forget, their former chief executive now sits in the Treasury. And I have to say, looking at the the benches opposite, they're also joined by quite a lot of Labour peers whose facial expressions the noble Lord, the Minister, cannot see.

My Lords, the government will, of course, say that business would say that, wouldn't they? But that is to miss the point. These are the people who make hiring decisions, who decide whether to offshore because it's cheaper and causes them fewer HR headaches, who decide whether to downside and who decide whether to just close down completely, as we just heard so powerfully in the last group from my noble friend Lord Leigh of Hurley and his correspondent, I think it was Mr. Dunham. Remember, my Lords, the impact assessment says that the measure is likely to have a disproportionate impact on small and micro businesses.

Additionally, following the decision by the government to double the Conciliating period to 12 weeks for Acas to resolve disputes, the Employment Lawyers Association have said we are apolitical, but the fact is that Parliament can pass all the reforming legislation it wants. But unless those laws can be enforced with cases heard within a reasonable time, its laws are placed over the horizon, de facto out of sight to both workers and employers alike. My Lords, these are the people who might be expected to benefit from the 10,500 increase in claims forecast to go before Acas in the government's own impact assessment.

Instead, they were expressing despair at the broken employment tribunal system. My Lords, as we saw last week, unemployment is rising and stands at almost 2 million. And it was reported yesterday half of the 170,000 jobs shed since Labour came to power from the under 25. Everyone who knows anything at all about wealth creation, about private sector hiring and about employment, Soar law says this bill will make it worse. Now, my Lords, I need to refer back to the Tony Blair Institute because they were very explicit about discouraging from hiring.

And I noticed that noble Lord, the Minister, did not engage with that particular point in his introduction because, my Lords, this debate is about the people, the party opposite claim to want to help. It's about the young person trying to find a job. It's about a long term unemployed person trying to rejoin the workforce. It's about a woman wanting to return to work after having children, and it's about somebody recovering from a long term health issue, getting back on their feet. This bill should be about helping them.

It is doing the complete opposite. The last time we debated this, the noble Lord, the Minister, constructed a tortuous analogy and said that I and my party were on some sort of journey. Well, if we are my Lords, our destination is common sense, and the government needs to listen to the wise voices on its on its own side and to join us. Turning to motion F1, all I'm going to do is quote what the Health Secretary said last week, quote, to be out on strike, setting back the NHS because you don't think we're going fast enough, and because the leadership of your union are not honest enough that some of this change takes time, is extremely irresponsible.

It is extremely unnecessary. It. The BMA is no longer a professional association and it is engaged in cartel like behaviour. The BMA leadership appear more interested in grandstanding and causing pain to patients than improving the lives of frontline resident doctors. Those are fairly damning words, my Lords, and according to the government's own analysis, the full time basic pay of resident doctors is expected to reach £54,300. Now, my Lords, this is where the farce becomes almost theatrical, because recently we heard that the Treasury considers any anyone earning above £45,000 a year is not a working person.

So it appears, my Lords, that the government has achieved something truly novel. They're actively creating a category, a category of so-called non-working people. Not my phrase, but the Chancellor's own definition. And then showering them with no strings attached pay rises. Meanwhile, the BMA, emboldened by these spineless handouts, continues to abuse its influence, holding our NHS hostage while the government waves through concessions without so much as a performance requirement or reform condition attached. So again, my Lords, the 50% threshold is not sort of some sort of draconian barrier.

It's a bare minimum, a line of defence against precisely this kind of chaos. Removing it will only accelerate the downward spiral that the government has set in motion with its desperate, unconditional giveaways. And they've now entirely predictable. The union bosses have now entirely predictably turned on them the moment it suited their agenda. My

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Lords, I beg to move. The original question was that

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The original question was that motion be agreed to? Since when a motion be one has been moved as an amendment to motion be leave out amendment to motion be leave out from house to end and insert? Do from house to end and insert? Do insist on its amendment 23 and 106 to 120, and do disagree with the to 120, and do disagree with the Commons in their amendments. 120 C 120 D and 120 E. The question,

16:31

Lord Burns (Crossbench)

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120 D and 120 E. The question, therefore, is that motion B1 be

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agreed to. My Lords, I speak in favour of

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My Lords, I speak in favour of motion E-1 as the noble Lord, the Minister set out. The government wishes to go back to an arrangement where all new members automatically where all new members automatically pay the contribution to the union's political fund, unless they take political fund, unless they take the initiative of opting out. My own view is that it should be equally easy for a person to choose to contribute, or not to contribute to the political fund at the point of applying to join a union.

And of applying to join a union. And that is what my amendment seeks to do. The alternative approach, supported by the government, is to have arrangements designed to minimise the number of new members who will exercise their legal right who will exercise their legal right not to contribute to the political funds. They want to do this by requiring action to opt out, but requiring action to opt out, but not requiring any action to opt in. But surely an equal choice can properly only be said is by respecting people's personal preference.

Clearly, the government preference. Clearly, the government wish to reduce the number of people exercising their right not to contribute. As one Labour member in contribute. As one Labour member in the House of Commons stated when opposing my amendment, they aim to avoid a reduction in the ability of avoid a reduction in the ability of working people to speak with a collective voice. Now, to me, this is a wonderful euphemism for putting barriers in the way of people exercising their true preference.

I accept that opting out arrangements have been the dominant arrangement for political funds since 1945. However, as I said last time, the rest of the world has moved on. Technology and widespread use of online applications and communications have made it much easier and less burdensome for members of an organisation to make a clear and convenient choice. Additionally, the standards that are now accepted for dealing fairly with people exercising their choice have changed significantly. Active, explicit consent has become the accepted standard.

I've examined the existing application forms for five unions, which have political funds, and whose application forms are easy to access without having to initiate the online application process myself, which I thought was a rather risky thing to do. Now two forms stand out the version of the unison form, which I have seen already provides a clear choice. There are two parts of the fund, one for the benefit of the Labour Party and another for general campaigning, and applicants are asked to tick their preference between the campaign funds, Labour link or no thank you.

The GMB form, which I've also seen, offers a clear choice to the question do you want to opt in for the political fund? There are two boxes and applicants are asked to select the yes or no box. The other three application forms simply ask if new members wish to contribute to the political fund. However, all of them, and this is an important point. All of them have clearly decided that it is in their own interests to ask applicants to opt in at the point that they apply to be members.

I'll come back to this in a moment. My goal remains to find a solution that provides genuine freedom of choice, avoiding the need for repeated arguments with each change of government. My amendment requires all unions to adopt the approach taken by the GMB and Unison unions. Under the present law. This amendment would give members a clear and transparent choice when joining a union gets away with it, gets away from a focus on opt in or opt out. And under this amendment, all applicants to join a union with the political fund will be required to answer a simple question do they wish to contribute to the political fund, or do they not? An equal choice with no bias? And that question will be on the application form.

I worry that this amendment, as it's set down in the Order Paper, may seem rather lengthy and complicated, but the essence lies in amendment 72. The remaining amendments are all subsidiary to the key provision of 72 D. In rejecting my previous amendment, the Minister in the House of Commons stated, and we've heard this from the Minister also again this afternoon, reinstating automatic contributions to the political fund unless members choose to opt out, would restore balance and fairness in union operations. But what could be more balanced and fairer than the present unison and GMB forms, where applicants have a clear choice which they exercise at the time that they apply to join? The Minister further claimed in the other House that the current opt in opt in system did not improve transparency or strengthen members choice.

But how can that possibly be true of the amendment I put forward today? What could be more transparent or strengthened choice than presenting two options side by side? Along with the case for having a political fund and allowing members to choose between them. Now the Minister and the House of Commons and the Minister this afternoon has emphasised that under the proposed arrangements in this Bill, members will be informed on the application form of their right to opt out of contributing to the political fund, and that opting out will have no impact on other aspects of their membership.

However, I noticed there has been no commitment to be able to exercise a choice to opt out by ticking a box on the application form. Perhaps the Minister could explain why this simple option wasn't mentioned, and apparently it won't be required even under the opt out system proposed by the government, it would improve transparency and strengthen choice if members could exercise their choice not to contribute on the application form if they are required to apply. Subsequently for an opt out form to complete.

Does this improve transparency? Does this strengthen choice? Of course not. I've had very helpful conversations with the with the Minister, and I must say, I'm very sorry to find myself in dispute with the government on this. I have no political interest in this debate, but continue to press the issue, because this is not the way we expect organisations to operate today. It's a step backwards from the hard fought cross-party compromise of 2016, and it's a stark reversal of everything we've learned in recent years about making choice more transparent and ensuring decisions better reflect people's true preferences.

people's true preferences.

16:37

Lord Vaux of Harrowden (Crossbench)

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Rather than really good.

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Speak to motion B1. I think, like many Labour Lords, start to become a bit uncomfortable when we have multiple rounds of ping pong have multiple rounds of ping pong and I generally hesitate to vote against the government in more than one round, but I'm expecting to one round, but I'm expecting to make an exception in this case for main reasons. Firstly, I firmly believe that introducing day one believe that introducing day one unfair dismissal rights will cause real and permanent harm to young real and permanent harm to young people and others who are seen as higher risk hires, such as those who have been on benefits for a long period.

Ex-Offenders people who've had long career breaks, perhaps because of parental or other caring obligations. And when other caring obligations. And when I say permanent, I mean that if you are unemployed for a year, it becomes considerably more difficult to get onto that ladder and to make to get onto that ladder and to make a success of your career. This is really important, my Lords. I'm really important, my Lords. I'm supported in that belief by every business group. The noble Lord Lord Sharpe has listed out many.

I'd add another, the Institute of Chartered Accountants in England and Wales, of which I'm a member, the Resolution Foundation, the Tony Resolution Foundation, the Tony Blair Institute and perhaps most importantly, the government's own impact assessment, which is very impact assessment, which is very clear on this. I'd love to hear the Minister's views on his own impact assessment. He's never actually assessment. He's never actually addressed that point. None of the several Ministers in this place or the other place has made any coherent argument to the contrary.

So can I put the question very simply to the noble Lord? The Minister will restricting the reasons that may be used to dismiss someone during a probation period, and thereby opening up the risk of an employment tribunal from day one, make it more or less likely that an employer, especially a smaller employer, will take a risk on give a chance to a young person with no experience, more or less likely. It's very simple. I think most of us know the answer to that.

Is he going to argue that his own impact assessment is wrong? Secondly, this directly contradicts other government policy. The government's youth guarantee is something I'm strongly in favour of. Will offer every eligible young person who's been on Universal Credit for 18 months, guaranteed paid work. To do that, you need employers who are willing to give them a job to take that risk. Why would an employer do that if they can be taken to the employment tribunal from day one? If the employment doesn't work out, it doesn't make sense, my Lord.

Third, despite frankly the clear harm, the government hasn't provided any evidence at all that the change will create any material, tangible benefits for workers. No evidence has been provided to show that the qualifying period is being abused or is causing actual harm. There's no evidence provided in the impact assessment. There is evidence that the doing this will cause harm, but there's no evidence of the harm that we're trying to solve. None has been provided in this or the other place. The the Resolution Foundation is also very clear on that.

If we're going to harm the life chances of young people, which is what the government confirms in its impact assessment, we must have real evidence that there's a genuine greater benefit, not just the usual statement that it can't be right, that someone can ever be dismissed for no reason. Finally, I want to look more closely at the claim that this is a manifesto commitment. It is in the manifesto, but it's part of a wider commitment that includes the explicit commitment. And I quote, we will consult fully with businesses, workers and civil society on how to put our plans into practice before legislation is passed.

Well, we've heard, my Lord, several times today that the government is going to consult afterwards. Now, they might argue that that is because the actual rules for the probationary period are going to be in the Statutory Instrument. But let's unpick this light touch probationary period they're talking about. The problem is that the bill expressly and specifically sets out the reasons why someone can be dismissed from day one during that probationary period. My Lords, that means it's not genuinely a probationary period, and the bill means that it cannot become a light touch probation period.

It's simply impossible the way the bill is currently drafted. I would love to understand more because it's talked about a lot this light touch probationary period. I'd love to understand what the government is actually talking about here, because we've not had any detail at all about what this really means, but what it cannot mean is that the employer can't. The employer is obligated by the bill, by the act. Should that come to pass to give specific reasons which are limited by this bill cannot be light touch, my Lords.

So I'd really like to understand better what he means by that. There is a possible way forward in that, however, which is where I start to perhaps part company a little bit with the noble Lords and the opposite benches. It is precisely the fact that in the Bill it sets out that there have to be specific reasons for the dismissal. That is the problem. That is what allows the employment tribunal to get involved during a probation period and all the rest of it.

I wonder, and I'm thinking aloud here, is there a solution to this problem by taking that element out? But anyway, for those reasons, I am inclined to support the opposition and its motion. B1 I urge the noble Lord, the Minister, to take this seriously as the as the Resolution Foundation put it. Very well. Let's not needlessly put employers off hiring.

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A good. These. We've had three very good

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We've had three very good speeches, and I don't intend to repeat what they have to say for very good speeches, because we heard the Minister and listened heard the Minister and listened very carefully to what the Minister had to say. And unusually, I will read what he said in Hansard rather read what he said in Hansard rather than just say I will. And because I think there's some interesting

16:44

Lord Fox (Liberal Democrat)

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think there's some interesting stuff there, phrases I picked out was we will not compromise on the fundamental principles of the bill. And I think it would help, perhaps, if those could be set out because they are what they are in the eye of the beholder at the moment. The the Minister also picked out the the notion that someone who had worked just less than two years shouldn't be unfairly dismissed. And I think even the noble Lord Sharpe amendment recognises that point very fundamentally.

But there are 730 days between day one and two years. You don't have to go from 730 to 1. There are there are, there are stages. So perhaps we just disagree there. The noble Lord pulled out something that I was going to to to speak on the the issue around light touch rules and the criteria for fair dismissal within, within the the nature of the bill. I have a problem, some problems with the noble Lord, those suggestion. Because if it isn't in the bill, in primary legislation, it will come as secondary legislation.

And we all know that His Majesty's loyal opposition never kill secondary legislation. I'm looking at you and we would like to from time to time, because it should happen and there should be a sense of jeopardy in secondary legislation, which there is not at the moment, my Lords. And without that sense of jeopardy, I'm not happy with taking things out. However, if it is in primary legislation, then the consultation is not worth anything because it's already there, so we might as well forget about that.

So, my Lord, as drafted as we know, the bill would abolish a qualifying period altogether. And I think the the rationale behind that is clear. And we will support the noble Lord in

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