Carers in England
Debate between Baroness Penn and Lord Haskel(1 year, 8 months ago)
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Lord Haskel
To ask His Majesty’s Government what steps they are taking to recognise the role of carers in England and their contribution to the economy.
The Parliamentary Secretary, HM Treasury (Baroness Penn) (Con)
Carers play a vital role in our communities and we owe them all a debt of gratitude. The adult social care sector employs 1.5 million people, with Skills for Care estimating that paid carers contribute around £50 billion to the English economy. In 2016, the ONS also estimated that the gross value added of unpaid care in the UK was £59.5 billion. The Government recognise the value of unpaid carers and provide financial recognition, primarily through the carer’s allowance.
Lord Haskel (Lab)
Yes, the Government are at last starting to recognise the value of carers. In spite of the excellent work of front-line carers, the paid-for system remains inadequate, even with the adult social care Bill—a Private Member’s Bill. We know that it is inadequate because millions of men and women, and even children, have to step in as part-time carers, limiting their time in work, education or training, at great cost to the economy. When are the Government going to introduce the social and economic reforms to the social care system that would enable these voluntary part-time carers to fully participate in and contribute to the economy?
Baroness Penn (Con)
The Government have set out our long-term plan for the reform of adult social care. In the autumn, we announced that we were making additional funding of up to £2.8 billion available in 2023-24, and £4.7 billion in the following year. Those decisions also involved a delay to rolling out some of the reforms that we had set out, so we will be updating our plan to implement that vision this spring, setting out the path forward.
Economic Downturn
Debate between Baroness Penn and Lord Haskel
Lord Haskel
To ask Her Majesty’s Government what assessment they have made of forecasts of an economic downturn later this year, and what steps they are taking in response.
Baroness Penn (Con)
Her Majesty’s Government do not prepare forecasts for the UK economy. In March, the independent Office for Budget Responsibility forecast growth of 0.3% and 0.2% for the third and fourth quarters. Recognising that the economic outlook has become more challenging since the OBR produced its forecast, in May the Government pledged a further £15 billion of support to help maintain consumer spending and head off the risk of an economic downturn.
Lord Haskel (Lab)
The Minister has not mentioned rising inflation, rising hardship and inequality, low growth and productivity, strikes, a fuel crisis and, especially today, climate change. All tell us that the outlook is dire. What are we going to do about it? Judging by the Tory leadership hustings, we are going to cut taxes and cut public spending, either now or later. No wonder the Conservative-dominated House of Commons Treasury Committee accused Ministers of a
“lack of long-term thinking in economic strategy”.
Those whom we rely on to invest and grow the economy do not make decisions based on headline tax rates and soundbites. Even though we only have a caretaker Government, will the Minister urge her colleagues to start thinking through a proper strategy to deal with this economic crisis, or simply adopt Labour’s strategy?
Baroness Penn (Con)
My Lords, there was quite a lot in that question. I am not sure that the noble Lord listened to my initial Answer, where I referenced the support that the Government are providing to help people with the cost of living. That was extended by £15 billion in May, but of course previous support was announced, which takes that to £37 billion. He mentioned a long-term plan for economic growth, which is exactly what the Government have. At spending review 2020-21, we made a landmark investment in capital projects and we are increasing public investment in R&D to £20 billion a year by 2024-25. Those are just two of the measures that we are taking to support our economy.
Cryptocurrencies
Debate between Baroness Penn and Lord Haskel
Lord Haskel
To ask Her Majesty’s Government what steps they are taking to regulate and supervise the use of cryptocurrencies.
Baroness Penn (Con)
Her Majesty’s Treasury and UK authorities have taken a series of actions to support innovation while mitigating risks to stability and market integrity. These include launching a new anti-money laundering and counterterrorist financing regime for crypto assets in 2020, and consulting on a proposal to ensure that crypto assets, known as stablecoins, meet the same high standards expected of other payment methods. The Government will issue our response to this consultation shortly. In January, the Government announced our intention to legislate to bring certain crypto assets into the scope of financial promotions regulation, requiring them to be fair, clear and not misleading.
Lord Haskel (Lab)
I thank the Minister for her response, which certainly deals with the marketing and promotion of crypto but does not deal with its actual use. For example, as reported in today’s Financial Times, crypto is being used as a way round the financial sanctions against Russia and can be used to get round the controls of the proposed economic crime Bill. Does the Minister agree with the Financial Stability Board that this poses a risk to the stability of traditional currencies and public security? Will the Government listen to these concerns and apply strong, prudential controls? Most importantly, will they give agencies the resources and powers to enforce controls, and, for example, call on the G20 to co-ordinate international regulation and supervision?
Baroness Penn (Con)
In my original Answer I did not only talk about the financial promotion of crypto assets; I also talked about the regulation of stablecoin. In response to the noble Lord’s point about the anti-money laundering regulations and counterterrorist financing regulations which apply to crypto assets, I would like to reassure noble Lords that the regulations imposing sanctions on Russia apply to crypto assets. Legislation being introduced this week in the economic crime Bill will give the Office of Financial Sanctions Implementation the powers it needs to enforce financial sanctions.
NHS Test and Trace
Debate between Baroness Penn and Lord Haskel
Baroness Penn (Con)
My Lords, we are continually working with local authorities to understand, for example, the uptake of the support payments available to those on low incomes who need to self-isolate. One of the challenges we have found is low awareness of the support available. We are working with local authorities, particularly in hotspots, to see what we can do to improve the communication of that available support—not just financial support but social support for those who may then need to isolate.
The Deputy Speaker (Lord Haskel) (Lab)
My Lords, all supplementary questions have been asked.
Bank Recovery and Resolution (Amendment) (EU Exit) Regulations 2020
Debate between Baroness Penn and Lord Haskel
Baroness Penn (Con)
My Lords, the second bank recovery and resolution directive updates the EU’s bank resolution regime, which provides financial authorities with the powers to manage the failure of financial institutions in an orderly way. This protects depositors and maintains financial stability while limiting risks to public funds. Under the terms of the withdrawal agreement, the UK has a legal obligation to transpose the directive by 28 December 2020. This instrument fulfils that obligation.
In transposing the directive, the Government have been guided by the commitment to maintain prudential soundness, alongside other important regulatory outcomes such as consumer protection and proportionality, when leaving the EU. We have also considered concerns raised by industry on elements of the directive that could pose risks to financial stability and to consumers, to tailor the approach for the UK market. As a result, we are not transposing the provisions in the directive that do not need to be complied with by firms until after the end of the transition period—in particular, an article that revises the framework for a minimum requirement for own funds and eligible liabilities, referred to hereafter as MREL, across the EU. The UK already has in place an MREL framework in line with international standards.
We are also sunsetting certain provisions so that they cease to have effect in the UK after the end of the transition period, as well as including provisions to ensure that the elements that remain in effect after the end of the transition period continue to operate effectively. The sunsetted provisions will cease to have effect in the UK from 11 pm on 31 December. In doing so, we have taken an approach that meets our legal obligations but also ensures that the UK’s resolution regime remains robust and is in line with international standards. We have engaged with industry and stakeholders to help explain exactly what this means for them.
I turn to the draft Securities Financing Transactions, Securitisation and Miscellaneous Amendments (EU Exit) Regulations 2020. This instrument, along with the approximately 60 other financial services instruments that the Treasury has introduced under the European Union (Withdrawal) Act 2018, is vital in ensuring that the UK has a fully effective legal and regulatory financial services regime at the end of the transition period. It achieves this by amending and revoking aspects of retained EU law and related UK domestic law, making a small number of necessary clarifications and a minor correction to earlier financial services EU exit instruments, and providing sufficient supervisory powers for the financial services regulators to effectively supervise firms during and after the end of the transition period.
I turn to the draft Financial Holding Companies (Approval etc.) and Capital Requirements (Capital Buffers and Macro-prudential Measures) (Amendment) (EU Exit) Regulations 2020. The fifth capital requirements directive, known as CRD5, continues the EU’s implementation of the internationally agreed Basel standards. These standards strengthen and develop international prudential regulation, which helps ensure the safety and soundness of financial institutions. This SI will transpose that directive into UK law, as required under the terms of the withdrawal agreement. It will also ensure that the legislation transposing it continues to operate effectively in the UK after the end of the transition period.
As with previous capital requirements directives, the Government will delegate most of the responsibility for implementation to the independent Prudential Regulation Authority—the PRA—which has the requisite technical knowledge and skills to ensure effective and proportionate implementation. This instrument includes only provisions legislatively necessary to ensure that the PRA can implement CRD5. This instrument is in line with requirements of article 21a of CRD5 for holding companies in scope to apply for supervisory approval. The framework and scope of the approvals regime will be administered by the PRA, and the instrument gives the regulator appropriate tools to ensure compliance with it.
The instrument also makes changes to the macro- prudential toolkit, preserving the current level of macroprudential flexibility. The most important of these is enabling the PRA to apply an other systemically important institutions buffer and a systemic risk buffer to certain institutions to address particular financial stability risks.
Although the capital requirements directives were created with banks in mind, they also apply to investment firms. However, the risks faced by investment firms are different from those faced by banks. Therefore, this instrument excludes non-systemic investment firms from the scope of CRD5. Investment firms will remain subject to the existing prudential framework until the Financial Conduct Authority introduces the prudential regime for investment firms, following Royal Assent of the Financial Services Bill.
Finally, I turn to the Bearer Certificates (Collective Investment Schemes) Regulations 2020. The UK has been at the forefront of international changes that are transforming tax authorities’ ability to work across borders to tackle emergency international tax risks. Bearer shares or certificates are anonymous, infinitely transferable and an easy means of facilitating illicit activity such as tax evasion or money laundering. This is why UK companies have been prohibited from issuing them since 2015. The OECD’s global forum noted in its 2018 peer review report that, although the UK had “mostly addressed” its 2013 recommendations concerning the prohibition of bearer shares,
“a small cohort of entities and arrangements … are still able to issue bearer shares or equivalent instruments.”
The report went on to recommend that the UK abolish bearer shares. This instrument implements that recommendation and prohibits the remaining entities capable of issuing bearer shares or certificates—which include certain types of collective investment schemes—from doing so. It also makes arrangements for the conversion or cancellation of any existing bearer shares. This brings those remaining collective investment schemes, including open-ended investment companies formed before 26 June 2017 and all unit trusts not authorised by the Financial Conduct Authority, in line with companies formed under the Companies Act 2006, which are prohibited from issuing bearer shares by the Small Business, Enterprise and Employment Act 2015. Complying with the global forum’s recommendation will help make sure the UK maintains its position at the forefront of the international community, continuing to set standards that help improve offshore tax compliance and fund our vital public services.
In summary, the Government believe that these instruments are necessary and vital for the UK’s financial services regulatory architecture, and I hope noble Lords will join me in supporting the regulations. I beg to move.
The Deputy Speaker (Lord Haskel) (Lab)
My Lords, the noble Baroness, Lady Bowles, has withdrawn, so I call the noble Lord, Lord Mann.