Public Finances: Borrowing Costs
Baroness Foster of Aghadrumsee Excerpts(1 week, 2 days ago)
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Lord Livermore (Lab)
I agree with a lot of what the noble Lord says. He and I are both strong supporters of an industrial strategy. The Government’s new modern industrial strategy is a core component of what the noble Lord is asking for. We are introducing a new industrial strategy that will give the private sector the guidance it requires about the sectors that we would like to see investment coming into. We are doing planning reform, which is one of the biggest reforms that we can possibly do to unlock new levels of private sector investment in the economy. We are doing pension reform, which the Chancellor set out in her Mansion House speech. We are doing skills reform—another key component of unlocking investment in our economy. All those things will significantly boost growth in our economy, but none of them is yet included in the OBR’s forecast.
Baroness Foster of Aghadrumsee (Non-Afl)
My Lords, how concerned are the Minister and His Majesty’s Treasury that £9.6 billion of cash was withdrawn last year from the London Stock Exchange—the highest amount on record?
Lord Livermore (Lab)
Clearly, ensuring that UK businesses have access to finance is crucial to this Government’s economic policy.
Small Farms and Family Businesses
Baroness Foster of Aghadrumsee Excerpts(1 month ago)
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Baroness Foster of Aghadrumsee (Non-Afl)
My Lords, I thank the noble Earl for bringing this debate to the House, as it is of fundamental importance that we discuss the impact of the recent Budget on the UK’s rural community. Obviously, it would have been preferable that the discussion on the impact of the Budget measures had been assessed before their announcement, but that was not what the Government chose on this occasion. It means that policy decisions have been made on flawed data.
We have heard much from the Government about how the changes to agricultural property relief will impact on only relatively few farming families, but the reality is somewhat different, certainly in Northern Ireland. This week the Department of Agriculture, Environment and Rural Affairs in Northern Ireland published an analysis of the impact of the budgetary measures. The figures are stark. The price of land in Northern Ireland is high, for a variety of reasons, and the latest government figures for 2026 projecting forward are that it will cost £21,000 per acre. That figure covers agriculture and business property on farms. This means that farms that own greater than 19.5 hectares of agricultural land will be caught by the new measures announced in the Budget. That is 50% of the farms in Northern Ireland. Those figures are not from farmers or their union, the UFU, but from the government department in Northern Ireland. Even more striking is that this covers 80% of total farmed land in Northern Ireland.
I think noble Lords will agree that those are devastating figures, which is why solutions will have to be found before 2026. Food security for the whole of the UK is at risk. Why do I say that? Noble Lords will say, “Surely Northern Ireland is only a small part of the equation”. It is true that we have a population of only 1.9 million, but our farmers produce enough food for 10 million people, and 6 million of them are here in Great Britain. As a former Economy Minister in Northern Ireland, I know the importance of the agri-food industry very well. It is simply the largest economic driver in Northern Ireland. That is why these new tax rules will have a disproportionate impact in Northern Ireland, on not just our rural communities but our economic well-being.
The next issue is that these tax rules, if implemented in full, will cut to the very heart of the fabric of rural Ulster. If farms have to be sold to pay tax bills, families will leave the rural way of life. That will bring hugely negative changes to our society. Schools, rural shops, churches, sporting organisations—life will fundamentally change if there are fewer rural dwellers. Of course, farmland is not just an asset; it is a legacy, a symbol of perseverance, and a promise to future generations. We have to allow that promise to be fulfilled.
The well-being of our rural dwellers is also of huge concern. We all know that farming is a solitary profession, and mental ill-health is often an undiagnosed issue. The implications of the tax burden have added to farmers’ worries, and that cannot be dismissed. I commend the National Farmers’ Union’s president on trying to explain the emotional stress yesterday to the Select Committee in the other place. Whether you are an elderly farmer worrying about estate planning or a young farmer wondering whether it is worth the worry taking on the debt that you would have to take on to keep the family farm going, it is a really worrying time. Yes, farmers are particularly bad at succession planning—I used to be a country solicitor before I entered politics, so I know it all too well—but they often work for very little just to have the hope of handing on the farm to the next generation. This policy threatens that hope and adds to the growing burden on farmers. They are already under pressure from government regulation and supermarket powers.
So solutions have to be found. Of course, I would prefer the tax to be scrapped but, if that does not find favour with the Treasury, please set the threshold much higher—so you are not attacking the rural way of life—or have a definition of an active farmer and exempt active farmers from the tax. That would deal with those who are buying up farmland for other purposes. That is what happens in Germany and the Republic of Ireland, so solutions are available. I really hope the Government take the time to listen to those solutions, because farmers are fair people and it is wrong to attack their way of life.
Wales: Public Services
Baroness Foster of Aghadrumsee Excerpts(2 months, 1 week ago)
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Lord Livermore (Lab)
As always, my noble friend says it far better than I could. I nearly always agree with him, and I do so on this point in particular.
Baroness Foster of Aghadrumsee (Non-Afl)
My Lords, the Barnett formula was introduced for Scotland by a Labour Government in 1978; then it was applied to Wales and then to Northern Ireland. That is nearly 50 years ago. Surely it is time to look at a new mechanism that will reflect the modern devolved Administrations.
Lord Livermore (Lab)
I give the noble Baroness the same answer that I have given already: I do not think the Government have any such plans. The Northern Ireland Executive settlement for 2025-26 is the largest in real terms of any Northern Ireland Executive settlement since devolution. The Northern Ireland Executive will receive £18.2 billion in 2025-26.
Independent School Fees: VAT
Baroness Foster of Aghadrumsee Excerpts(2 months, 4 weeks ago)
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Lord Kennedy of Southwark (Lab Co-op)
Can we hear from the noble Baroness, Lady Foster?
Baroness Foster of Aghadrumsee (Non-Afl)
My Lords, I am grateful to the noble Lord. Is the Minister aware of the disproportionate impact that this tax will have on Christian schools in Northern Ireland given the structure of the education system there? Given that, will a specific impact assessment be carried out?
Lord Livermore (Lab)
The impact assessment will cover the full range of expected impacts.
NatWest: Account Terminations and Branch Closures
Baroness Foster of Aghadrumsee Excerpts(1 year ago)
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Baroness Vere of Norbiton (Con)
If I may, I will focus on the second part of the noble Lord’s question around account termination. It is an issue that the Government take incredibly seriously. For absolute clarity, the Government are clear that payment account providers must not discriminate on the basis of political belief or, indeed, any other opinion. Therefore, following events over the summer, the Government issued a policy statement on 21 July which very clearly set out that 90 days’ notification must be given to any customer whose account is to be closed. Also, the bank must give a reason for that closure. That will come into legislation in due course. We are working at pace to draft the secondary instrument and it will be laid in your Lordships’ House soon.
Baroness Foster of Aghadrumsee (Non-Afl)
My Lords, the Minister may recall that, towards the end of last year, I asked about the establishment of a banking hub for my home town, Lisnaskea, after the Ulster Bank, which is part of the NatWest group, decided to close the last remaining bank in that rural town. I mention rurality as I was surprised when I met the representatives of LINK, which has set up banking hubs, who told me that they do not take into account the rural nature of the area when they are deciding on banking hubs. I understand that there is a consultation ongoing: when changes are being made, will the Minister consider the needs of rural dwellers?
Baroness Vere of Norbiton (Con)
I am grateful for that intervention, because that is precisely what we intend to do. We are placing the existing voluntary arrangements set up by the banking sector on a statutory footing. There is a consultation out at the moment by the FCA, part of which is asking what factors and criteria should go into any assessment—the number of people in the area, the number of SMEs affected, the impact on the vulnerable and what other cash access services there are. Of course, rurality will impact on all those factors, so it will be taken into account.
Banking Hubs
Baroness Foster of Aghadrumsee Excerpts(1 year, 1 month ago)
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Baroness Vere of Norbiton (Con)
There were many questions there and perhaps I will focus on the last one, which is where the FCA consultation comes to the fore. The proposals set out by the FCA are very detailed and potentially go much further than the voluntary initiatives of banking hubs that have so far been undertaken by the sector. Obviously, that consultation remains open until 8 February, and we will be looking for not only banks to respond but representatives of the vulnerable groups the noble Baroness describes, so that we can get a full view of what the proposals should be.
Baroness Foster of Aghadrumsee (Non-Afl)
My Lords, I commend the establishment of banking hubs across the United Kingdom as an alternative to the closure of mainstream banks. Can the Minister set out the criteria for such banking hubs being initiated? Just one has been established in Northern Ireland. Recently, the Ulster Bank decided to close a range of banks across Northern Ireland, leaving many rural areas without physical banking facilities. What are the criteria for the establishment of banking hubs, because there is a need for one in Lisnaskea, south-east Fermanagh?
Baroness Vere of Norbiton (Con)
I recognise what the noble Baroness is saying. The criteria currently used to assess whether a community needs a banking hub are set out in consultation with the financial services sector; that is part of the current voluntary arrangement. I point the noble Baroness to the FCA consultation, because the criteria to be set out going forward are far more detailed and focus on the needs of not only local communities but SMEs. The consultation will also look at seasonal fluctuations in the need for cash access and the ability of SMEs to get coins and notes. The FCA is going further than the current voluntary arrangements.