Holocaust Memorial Bill

Baroness Scott of Bybrook Excerpts

Committee stage
Tuesday 11th March 2025 Grand Committee

[Baroness Deech (CB)]

My Lords, I have visited the Berlin memorial more than once. It is widely regarded as inappropriate and ineffective. People picnic on it, they bicycle around it, they dance on top of it. They do not know what it is and, of course, what good has it done in Germany? Where is Germany heading now? Look at the rise of anti-Semitism across Europe. There is no relationship at all between the position of a memorial and the effect that it has.

As for the contents of the learning centre, there will be an amendment later. However, Answers to the many parliamentary Questions I have asked have always said that the memorial will contain references to other genocides. This genocide or that genocide—the Government do not seem to know which ones but have always referred to others. It is only very recently that someone has said, “Oh, but the genocide of the Jews is more important than the others and shouldn’t be compared”.

[Baroness Scott of Bybrook (Con)]

My Lords, I am going to stick to the Bill in front of us, particularly the amendments in this group that relate to the future management of the Victoria Tower Gardens. Many noble Lords use the gardens frequently. I used to do so twice a day. Many use it often—every day. It is an important green space in the heart of our capital city and noble Lords are right to raise questions about the future management of the gardens. I know we will be debating the protections for the existing installations and trees in the next group.

During my time as a Minister in DLUHC, now MHCLG, I worked on the delivery of the Holocaust Memorial. We support the delivery of the memorial as soon as possible. It is almost a national shame that we are 10 years down the road and it is 80 years since the release of many people from those terrible camps. As I said last week, however, it is vital that the memorial is delivered soon, so that some of our survivors can still be with us. I just cannot imagine the opening of this memorial after so long without some survivors still to be there.

I was interested in the amendment of my noble friend Lord Eccles and Amendment 33 in the name of my noble friend Lord Blencathra. They raise important questions for the Government about who will manage the learning centre and the memorial. I will listen with interest to the Minister’s reply, as this is an important area where we deserve some clarity from the Government on the future direction of their project. However, my noble friend Lord Pickles is absolutely right. We do not have even planning permission yet, let alone the future management structure of the memorial and learning centre. It will be important for the body responsible for the memorial and learning centre to work with local communities as well. I am sure the Minister is listening to that. As we move forward, the two groups will have to work together regularly on what is happening at the centre and how the park is protected.

I am inclined to support the right reverend Prelate the Bishop of St Albans in his Amendment 22 on closures of the gardens. It is important that the gardens are not closed to local people too often. That can be discussed with local people on an ongoing basis. That happens all over this country where parks are sometimes used for community use, whereby the community talks to the people responsible for the park. I am sure it happens with the Royal Parks as well. Many people enjoy Victoria Tower Gardens regularly; we must consider their interests as we work to deliver the memorial.

I see an argument for the gardens being closed to the public on only a small number of days, and Holocaust Memorial Day would be one example. But the underlying theme here is that we must balance the rights of the different groups who use the gardens, and the right reverend Prelate’s amendment may help achieve that balance. However, it is inappropriate for that to be in the Bill. That is not what the Bill is about. As with many of the amendments that we shall debate today, these are planning considerations. I look forward to the Minister’s response to the amendments in this group.

[Lord Blencathra (Con)]

My noble friend said that we have not yet had a planning application. Would she care to join the noble Baroness, Lady Deech, in pressing the Minister on this yes or no question: will there be a new, fresh planning application? Also, will she press the Minister in demanding a new planning application?

[Baroness Scott of Bybrook (Con)]

I will make that ask of the Minister in our debate on a subsequent group; if he does not answer now, I will repeat it.

[The Parliamentary Under-Secretary of State, Ministry of Housing, Communities and Local Government (Lord Khan of Burnley) (Lab)]

My Lords, this has been another passionate debate. I thank the noble Viscount, Lord Eccles, the right reverend Prelate the Bishop of St Albans and the noble Lord, Lord Blencathra, for their Amendments 5, 22 and 23. With this group of amendments, we are in essence considering the future of Victoria Tower Gardens as a place where all members of the public can enjoy free access to a green space in the very heart of Westminster.

From the beginning of the design process, the importance of maintaining access to Victoria Tower Gardens has been a high priority. The design that we are taking forward was selected from a long list of exciting and high-quality proposals partly because it showed a great deal of respect for the gardens, positioning the memorial at the southern end and leaving the great majority of open space to the public; I will not get into the debate on the size of the project because that will be discussed in our debate on the third group. Our proposals also include a high level of investment in the gardens themselves: we will improve the quality of the paths, the planting and the grass lawn; and we will provide new boardwalks, enabling better views of the Thames, with paths and seating made more easily accessible for all.

Amendment 22 in the name of the right reverend Prelate the Bishop of St Albans would impose a statutory limit on the number of closures of Victoria Tower Gardens for commemoration events related to the Holocaust. As I have said—I will say it again now—it has always been our intention that Victoria Tower Gardens should remain open to the public, with only a small area taken for the Holocaust memorial and learning centre when it is built. We are well aware of the value placed on the green open space by local residents, nearby office workers and visitors to Parliament, not to mention parliamentarians themselves; that is why the Bill ensures that the requirement to maintain Victoria Tower Gardens as a garden open to the public will remain.

Assurances were given to the Lords Select Committee on various points, including commitments relating to the management of Victoria Tower Gardens; these were mentioned by the right reverend Prelate. Ministers will continue to be held accountable for those public assurances by Parliament in the normal way.

Closures were discussed in some depth by the Lords Select Committee. The result was that the committee’s special report directed a recommendation to the Royal Parks—which manages the gardens on behalf of the Department for Digital, Culture, Media and Sport—to consider this matter going forward. A number of noble Lords, in particular the right reverend Prelate the Bishop of St Albans and the noble Baroness, Lady Deech, mentioned the closure of Victoria Tower Gardens for the Yom HaShoah event on Sunday 5 May. This was requested by the then Culture Secretary because the gardens’ location made them more accessible for frail Holocaust survivors than the usual venue in Hyde Park. Contrary to claims by petitioners at the hearing on 20 November, our understanding is that the partial closure was for one day only, with the playground remaining open until midday—not the three days that have been mentioned. No decisions have been taken on future closures of the entirety of Victoria Tower Gardens to facilitate Holocaust-related commemoration events once the Holocaust memorial and learning centre is built.

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[Lord Pickles (Con)]

My Lords, that would be a predetermination.

[Baroness Scott of Bybrook (Con)]

My Lords, I thank my noble friend for explaining so well the reasoning behind why we should wait for the planning system. I was going to say something very similar, but now I do not need to because of the timing. However, it would be helpful if the Minister could take the opportunity to give this Committee more detail about the process and the legalities, and about the reasons why we are doing what we are in this Bill, and where it should not then have anything to do with the planning system. That is an important thing to do and I ask that we have it in writing, to clarify this well in time for Report.

I was going to say something about all the other amendments in this group, but I feel that they would be much better discussed within the planning system and not within this Bill.

I will mention something about tea rooms. Interestingly, when I came in today, I was very much in support of not having them, but, having listened to the evidence and thought about it, it is actually not a bad thing to have that in a park that is used by all sorts of people for all sorts of different reasons. I certainly will not be supporting that proposal any longer. As far as I am concerned, all the other amendments should be dealt with in the planning system, so it is not worth my taking up any more of the Committee’s time.

[Lord Khan of Burnley (Lab)]

My Lords, I thank the noble Lords, Lord Strathcarron and Lord Blencathra, the noble Baronesses, Lady Walmsley and Lady Finlay, and the right reverend Prelate the Bishop of St Albans for bringing these amendments. This group covers a set of topics relating to the potential impact of the proposed development. As we consider these topics, it is necessary to keep in mind the relationship between this Bill and the process for seeking planning consent.

The Bill does not include provisions to grant planning consent. I am quite sure that noble Lords would have criticised the Government forcefully if we had tried to bypass the normal route for seeking planning consent by including any such provisions in our Bill, a point alluded to by the noble Lord, Lord Pickles. The planning process, put in place by Parliament and regulated through the courts, is the proper process for considering a development such as the national Holocaust memorial and learning centre.

Let me be clear in addressing the points of the noble Lord, Lord Sassoon, in relation to the planning process, which a number of noble Lords, including the noble Baroness, Lady Scott of Bybrook, alluded to. We, as the applicant, stand by the current planning application. We do not intend to withdraw it. It is for the designated Minister to decide how to deal with the current application. We understand that he has three broad options: to invite written representations and then decide; to hold a further planning inquiry; or to hold a round-table discussion. All options would mean opportunities for opposing views to be considered. It is for the designated Minister to decide the approach.

The arrangements are perfectly proper. When they were challenged in the court in 2020, that challenge did not succeed. In all called-in applications, it is for the designated Minister to decide the mode of considering the application. We have given an assurance to the Lords Select Committee that we will make sure that Peers and MPs are notified when the process of retaking the planning decision starts. There will therefore be opportunities for people to make their views known. It will be up to the designated Minister to decide how to deal with those views, including whether to have a new inquiry.

The planning process requires extensive consultation, detailed scrutiny by technical experts and consideration of an extensive range of statutory provisions, regulations and planning policies. The process enables a balancing exercise to be conducted, in which the benefits and impacts of any proposal can be properly assessed. With the greatest respect to noble Lords, and acknowledging the deep expertise that can be found across the Committee, I submit that we should be extremely wary of interfering in these processes. We are not sitting here as a planning committee. I suspect that few of us here will have read all 6,000-plus pages of evidence submitted with the planning application, or the many detailed responses from experts, supporters and opponents of the programme. I hope that noble Lords will forgive me for setting this point out in detail. I will now turn to the amendments in question.

Amendment 7, from the noble Lord, Lord Strathcarron, relating to other memorials in Victoria Tower Gardens, would have the effect of tying the hands of the planning decision-maker and stopping the current proposal. The amendment would give protection to those memorials above and beyond the protections they already enjoy as listed buildings. We all want to ensure that the memorials and monuments in Victoria Tower Gardens, and their setting, are respected. Our design is sensitive to the heritage and existing uses of Victoria Tower Gardens. It includes enhancements to the gardens that will help all visitors, including better pathways and improved access to existing memorials.

The planning inspector considered a great deal of evidence from all sides and looked in great detail at the impact on the gardens and on existing memorials before concluding that any harms to heritage assets were outweighed by the public benefits of the scheme. As drafted, the proposed change to Clause 2 is not necessary to ensure that memorials are given proper weight in the planning process. It would, however, act as a barrier to proceeding with the proposed Holocaust memorial and learning centre. I therefore respectfully ask the noble Lord to withdraw Amendment 7.

Plan for Neighbourhoods

Baroness Scott of Bybrook Excerpts

Monday 10th March 2025 Lords Chamber

[Baroness Scott of Bybrook (Con)]

My Lords, I begin by welcoming this Statement on the Government’s plans for neighbourhoods. While we echo the Government’s desire for the growth and renewal of our neighbourhoods and high streets, we must be clear that this builds on the work of and progress made by the previous Conservative Government. In fact, it seems apparent that this Statement is merely a rewrite of the scheme progressed under the previous Government. So does the Minister agree that on funding, allocation and time periods, this scheme is a rehash and an admission by the Government that levelling up was indeed working?

EU cohesion funds were subject to accountability to both the UK Government and local representatives. The previous Government’s levelling-up strategy aimed to address the very challenges highlighted in the Statement by mobilising a broad range of national resources. We understood that local leaders were seeking investment, and we acted on this by allocating a £2.6 billion fund to the regeneration of our communities, a £4.8 billion levelling-up fund to support vital assets like pubs and theatres, and a £1.5 billion long-term plan for tax reforms. That, if my maths is correct, is £8.9 billion, compared to the £1.5 billion over 10 years that this Government are suggesting.

We should acknowledge that the Government delivered this Statement while their own financial choices, made in the October Budget, are damaging local communities. This modest announcement is inconsequential when considered against the jobs tax, the increase in business rates in the hospitality and retail sectors, the changes to business property relief and the multi-million-pound funding gap that appeared in council budgets as a result of the October Budget. This is before we address the impact of the loss of the rural services grant and the community ownership fund, which sought to provide support to communities that need it most. Will the Minister confirm what assessment has been made of the impact of the Chancellor’s tax hikes on local economies, such as those His Majesty’s Government are about to fund?

We have reservations and concerns about the Statement made last week, so I look to the Minister to provide some clarity. First, I ask the Minister to confirm what measures will be in place to ensure appropriate oversight and accountability of the proposed neighbourhood boards. It is essential that the boards include democratically elected representatives of those communities. We are concerned about the role of trade union representation. Can the Minister confirm exactly what role those trade union representatives will play on these community boards? Local democracy is vital if these boards are to work effectively.

Next, what exactly is the purpose of these resources? Will these funds go primarily towards making up the shortcomings that the Budget created in other areas of government spending? Finally, I echo the worry expressed in the other place that the resources will not be allocated in a way that reflects the needs and particular circumstances of communities. By widening the criteria and choosing to use broad national statistics, the unique and local understanding of a community’s needs and risks are being overlooked. As the representatives of their areas, local authorities are in a unique position to be able to identify the specific requirements of their communities, and a bidding process allows them to present a plan to the Government. If the Government proceed with the process of allocation, as suggested, those who can do the most to regenerate our high streets and communities may lose out in favour of those who are able to meet the Government’s criteria. I look forward to receiving a clear but also a positive response from the Minister.

[Baroness Pinnock (LD)]

My Lords, I have relevant interests as a councillor in Kirklees, which includes Dewsbury, one of the towns on the list. I am also a vice-president of the Local Government Association.

I welcome investment in towns across the country that have higher than average levels of deprivation. I hope that the Minister will agree that the regeneration needed by so many towns reflects the many years of neglect by previous Governments in funding and supporting long-term regeneration programmes by local councils for their areas.

I have a number of questions for the Minister. First, as the noble Baroness, Lady Scott, asked, can he confirm that this programme is a continuation of the long-term plan for towns fund, which was introduced by the previous Government? As far as I can tell, the list of towns is precisely the same. Secondly, can the Minister provide detail on the selection criteria, given that, as the Statement says, the towns in the list were all in the bottom 20% of the index of multiple deprivation? Of course, the list does not include them all—it is not an inclusive list—so which towns, under those deprivation criteria, have been rejected and why? If the Minister does not have an answer to that question, which I accept is quite detailed, I would be happy for him to give me a written response.

It is positive that the Government have extended the list of potential uses of the funding, compared with its previous iteration. However, each town is to get £2 million a year for the next 10 years. Does the Minister agree with me that making a sea change in a town will require more than that level of funding? That is not to decry the funding, which will be helpful, but simply to note that this will not make a strategic and long-term difference for those towns as a whole. There will be improvements, given the money available, but that level of funding is inadequate for a major uplift.

I will give the Minister an example. Dewsbury in Kirklees is included in this list. The swimming pool and sports centre that served the town, and which were run by the local council, had to be closed due to RAAC. The council said that it will not rebuild or further provide either a sports centre or a swimming pool, so there will be no other provision of those facilities in that town of, say, 80,000 people, which suffers from considerable deprivation. Replacing them would be a major investment in the health and future of young people, yet the funding provided in this plan for neighbourhoods will not go anywhere near meeting that.

Can the funding available be used as match funding, or provision towards capital spending or revenue spending, for such long-term investment? The funding available is split 75% capital and 25% revenue. Is there flexibility within that? Perhaps the first five years could be capital funding, with revenue at the back end of the scheme. It would be worth knowing from the Minister whether there could be some flexibility there.

Finally, it is good that each town has to create a town board to make funding decisions and that those who serve on that board are committed to the town’s future. However, can the Minister explain the reasoning for excluding local councillors elected to represent the town in making those decisions? Can he say what accountability mechanism there will be for all the funding? Will there be annual reports to the House on the progress being made? Overall, the plan is good, but there is more to do.

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[Lord Khan of Burnley (Lab)]

My Lords, the noble Baroness makes an interesting and good point about having diversity and inclusion from a cross-section of society. We will set out further guidance on this issue. I will say again that it is for local neighbourhood boards to come out with proposals that will benefit their area, and the best benefits are where everybody is included as part of the whole deliberation, discussion and finalisation of neighbourhood boards.

[Baroness Scott of Bybrook (Con)]

Can I get some clarification? Are the Government going to clarify in some guidance who should be on these boards, or will the composition of these boards be something that local councils decide? That is very important. I come back to the unions: in some areas of this country there may not be any union representatives who want to be on the board but there may be in others. Will that be something that the Government say has to happen, or will it be purely a local decision?

[Lord Khan of Burnley (Lab)]

My Lords, I said repeatedly in the Statement and say again that it is for the local neighbourhood boards of the 75 places to decide who is on their board, with the guidance of the local authority. Many of those 75 places have already created neighbourhood boards and regeneration plans and, again, it is for them to adapt those. We will be giving more framework guidance—in particular, clarification on the capacity funding.

My noble friend Lady Armstrong talked about the new deal for communities led by John Prescott. It has been clear from the evidence that on the year-zero plan, where local authorities can plan before the funding is distributed, in particular on paperwork and architectural designs for capital projects, there is a lot to learn from the evaluation of the new deal for communities. We are following that plan. We have been inspired by the new deal for communities and what it achieved for our country, and we will implement this plan for neighbourhoods to make sure we give more power back to regional and local areas in the 75 places. I reiterate that it is a local-led initiative—it is bottom-up, not top-down.

Holocaust Memorial Bill

Baroness Scott of Bybrook Excerpts

Committee stage
Tuesday 4th March 2025 Grand Committee

[Lord Griffiths of Burry Port (Lab)]

My Lords, I echo what has just been said. I have no problem with the British taxpayer paying up its share to realise this noble objective; I just wish there were a figure that would allow us to think of the scale, size and nature of the project so that anything above and beyond that would rest with others in the private sector. I do not care whether they are Jewish or not Jewish.

It seems to me that the bald statement on the face of the Bill—

“The Secretary of State may incur expenditure”—


pure and simple—is not helpful at all. If people do not agree with the figure in the amendment, let them come up with a better one, but it seems to me to be a responsible thing, at a time of great financial stricture, for us to be generous but to indicate the levels of our generosity by putting in the Bill the sort of figure that we would be happy to endorse in legislation coming from this Parliament.

[Baroness Scott of Bybrook (Con)]

My Lords, this has been a mostly good opening debate on this very important Bill. I want to begin by setting out His Majesty’s Official Opposition’s broader approach to this legislation before addressing the specific amendments in this group. As I said at Second Reading, my noble friend Lord Cameron of Chipping Norton made a solemn commitment to the survivors of the Holocaust, saying that

“the past will never die and your courage will never be forgotten”.

That was 11 years ago.

We have heard a great deal about solemn commitments already this week, but this is not a promise that we can break. In the 80th anniversary year of so many liberations of concentration camps, we have a duty to deliver a Holocaust memorial and learning centre right here in Westminster, at the heart of our democracy. We must do this so that survivors who are still with us can see it opened to the public, sure in the knowledge that we as a nation have renewed our commitment never to forget the horrors of the Holocaust. That is what is at stake with this Bill. I fear that if the Government do not succeed in securing this Bill in this Session, we may lose our chance to build the memorial that the survivors of the Holocaust and their families deserve in their lifetime.

--- Later in debate ---

[Lord Blencathra (Con)]

My Lords, I do not think I can recall this Committee Room being so packed out with colleagues, on all sides, for such an important and controversial debate. As the Minister would say, some passionate speeches are being made here today; I am grateful to all colleagues who have taken part.

I was particularly struck by the comments from the noble Lord, Lord Lisvane, who gave a powerful criticism of the Explanatory Notes. It is not just this Bill where I have found that the Explanatory Notes did not explain much; as a former chair of the Delegated Powers Committee, I found that in almost every Bill we got. The noble Lord is right to make the points that there could be substantial changes to Parliament’s visitors centre and that that has not been taken into account here.

The noble Lord, Lord Carlile, rightly praised the dedication of my noble friends Lord Pickles and Lord Finkelstein to a memorial. My noble friend Lord Pickles has for many years championed this cause; just because I think that it may be the wrong place and the wrong memorial does not take away from the fact that he has been an absolute hero. However, my noble friend said that this memorial would improve the park, but that is not what Adjaye, the architect, said. When people said that these fins are despicably ugly, he said:

“Disrupting the pleasure of being in a park is key to the thinking”


on the memorial. I thought that key to the thinking was finding a memorial that commemorated the 6 million exterminated Jews, not putting something ugly in the park. Of course, the Government never mention Adjaye now. In the press release announcing that his bid had been accepted, he was named 12 times as the greatest architect in history. Now, he is wiped out from the memory, and the name is given to the rest of his firm but not to Adjaye.

Moving on, the noble Lord, Lord Carlile, was so right to point out that people will come to a memorial if it is good enough, not because of where it is sited. That is a key point.

I am grateful to my noble friend Lord Sterling. His description of his family circumstances and the Holocaust match, if in a different way, the circumstances of my noble friend Lord Finkelstein. The noble Lord, Lord King is right: let us have a decent learning centre and a fitting memorial.

My noble friend Lord Inglewood said that building in inflation, which is going through the roof at the moment, will be absolutely essential. That tied into the point made by the noble Lord, Lord Griffiths, about the fact that we must have a cost ceiling. It may not be £138 million—indeed, it may be something else—but, unless there is a cost ceiling, the costs will go through the roof.

I am grateful to the noble Baroness, Lady Walmsley, for her comments and her personal statement. I appreciate that she was not speaking as a party spokesperson.

My noble friend Lord Inglewood said that he was not an accountant, but at least what he said added up and made sense to me in any case.

The shadow Minister, my noble friend Lady Scott of Needham Market, said that no one wants to break a solemn promise. I suspect that there is no one anywhere in this Room who wants to break the promise to build a memorial, but what we all want is a proper memorial and a big, proper learning centre, as the Holocaust Commission recommended.

I come to the Minister. I have always liked him, ever since he was a Whip. I used to be a Whip in the Conservative Party. Us Whips have to stick together, in a sort of camaraderie; someone should explain that to Simon Hart. I welcome the Minister to his position—he is a thoroughly decent man and a caring, nice Minister—but he has been under some pressure today and that is not his fault. We have the National Audit Office’s report, which is devastating against his department. We have the Infrastructure and Projects Authority’s report, which is also highly critical. That same department has had to give the Minister a brief. He has had to defend the indefensible today, but I give him credit for trying.

I want to conclude by asking the Minister something. Before Report, when I suspect that noble Lords—perhaps better noble Lords than I—will wish to put down a new amendment on costs, will the Minister produce a full, updated cost for the project? Will he give detailed answers before Report, as well as full answers to the NAO’s criticisms? I should say to him that I do not think the NAO criticised this project because we have not got the Bill through yet. It said that this project was undeliverable based not on that but on the fact that there was no schedule, no budget and no quality control. For a whole range of reasons, it found it grossly inadequate.

I think the Minister said that my ceiling of a 15% contingency was an arbitrary figure. Well, the Government have suddenly bunged in an extra £50 million with no justification, and I suggest that that is also an arbitrary figure.

I am grateful to everyone who has spoken. Obviously, I will not push it today, but we will need to get some detailed answers on the costing and control of this project before Report, or I suspect that we will have to come back to this then. In the meantime, I beg leave to withdraw the amendment.

[Baroness Scott of Bybrook (Con)]

Before the noble Lord sits down, I just point out for Hansard that I am Lady Scott of Bybrook, not of Needham Market.

[Lord Blencathra (Con)]

I offer my sincere apologies to my noble friend.

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[Lord Inglewood (Non-Afl)]

My Lords, as someone who is not Jewish, as I mentioned earlier, I have been very moved by the debate I have just heard about the learning centre. I subscribe to the perspective of the noble Baroness, Lady Deech, and the noble Lord, Lord Carlile. As I was sitting there, I thought to myself, “Actually, there’s something that has not been mentioned”. It is—speaking as a non-Jew—the fact that Victoria Tower Gardens is a remarkable park as it stands now; that is a relevant consideration in our consideration in this place of what the future should be.

I am reminded of a story that I was told about the time when T Dan Smith redeveloped Eldon Square in Newcastle. He called in, as one of his expert advisers, Arne Jacobsen, the famous Danish architect. After the competition for the redesign of Eldon Square had been completed, he turned to Jacobsen and said, “If you had been putting in for this competition, what would you have done?” Jacobsen replied, “I would have left it just as it was before”.

[Baroness Scott of Bybrook (Con)]

My Lords, that was an extremely interesting debate from both sides of what I will call a discussion, not an argument. I thank noble Lords for it; I have learned a lot.

This is a large group covering three themes that have been discussed throughout the years of work that have been done on the Holocaust memorial. First, Amendments 2, 3, 4, 6 and 13 relate to the design of the memorial and the learning centre, seeking to prevent it involving an underground element and to separate the learning centre from the memorial. These issues have been debated at length. I do not feel that this Bill is the right place for us to debate issues relating to the planning and design of the building. I am sure that the Minister will respond to the noble Baroness, Lady Blackstone, in detail. We urge him to listen to her concerns, but we cannot support her amendments.

Amendment 23, tabled by the right reverend Prelate the Lord Bishop of St Albans, is one I do support. I do not think he spoke to it, but it has been such a long debate that I have forgotten what happened at the beginning. At a time when we are seeing growing anti-Semitism while marking the 80th anniversary of the end of the Second World War, we need to recommit ourselves to the memory of the Holocaust, as I said earlier this year when we debated Holocaust Memorial Day. My noble friend Lord Blencathra, speaking on behalf of the right reverend Prelate, was right to highlight the need for proper Holocaust education as we work to counter anti-Semitism.

I take this opportunity, a bit cheekily, to ask the Minister to update me on what steps his department is taking to counter rising anti-Semitism in this country. I am very happy to have a letter. Also, can he confirm that the Government will, at the very least, maintain the level of support for Holocaust education provided by the previous Conservative Government? I thank my noble friend Lord Blencathra for all the evidence that he provided showing the need for this continued education.

Finally, Amendments 29, 30 and 31, tabled by my noble friend Lord Blencathra, all seek to re-open the question of an alternative site for the memorial or learning centre. While I understand the arguments made by many noble Lords on the question of where the memorial and learning centre should be located, I cannot agree that re-opening this issue, when in the past we have looked at more than 50 sites, would be a constructive step forward and would deliver that centre in anything like a timely manner.

I said in my opening remarks that it has been 11 years since my noble friend Lord Cameron made that solemn commitment to the survivors of the Holocaust. I feel very strongly that we should not take steps that will hinder the delivery of that commitment any longer.

[Baroness Deech (CB)]

I will just elucidate for the noble Baroness that 50 sites were not looked at. The foundation just plumped for Victoria Tower Gardens. The thing about haste is that we are not building for the handful of survivors who are left. They do not need a memorial. If we build, we are building for the future. There is not a hurry. Survivors have said to me that they would rather it was got right; that is more important than hurrying. Even if everything went smoothly now, which I hope that it will not, there is no chance of getting it up in the lifetime of people who are in their late 90s. You have to get it right for the future, not for the handful who are left.

Non-Domestic Rating (Multipliers and Private Schools) Bill

Baroness Scott of Bybrook Excerpts

Committee stage
Thursday 27th February 2025 Grand Committee

Moved by

[Baroness Scott of Bybrook]

46: After Clause 4, insert the following new Clause—
“Review of impact on businesses, high streets and economic growth(1) The Secretary of State must review the impact of sections 1 to 4 of this Act on—(a) businesses,(b) high streets, and(c) economic growth.(2) The review must consider—(a) the impact on different types of business, including small businesses;(b) the impact on businesses operating mainly or solely on high streets;(c) whether the provisions have had a measurable impact on economic growth, and if so what that impact has been.(3) The Secretary of State must lay a report of the review before Parliament within six months of the day on which those sections take effect.”Member’s explanatory statement
This amendment would require the Secretary of State to review the impact of sections 1 to 4 of this Act within six months.

[Baroness Scott of Bybrook (Con)]

My Lords, in moving Amendment 46 I will also speak to my Amendments 53 and 54, which are all borne from the lack of detail in the Bill and the failure to publish an impact assessment for its first four clauses. The Government are asking us to agree to a Bill without clarity on the substance and the financial impact, and one which will make a real problem for businesses on the high street. They are asking us to support the Bill despite not providing any assessment of how it will impact on the high street and, while they promise to reduce business rates, the only thing that we know is certainly being reduced at this stage is the relief we offer to retail, leisure and hospitality businesses.

My Amendment 46 calls for a review of the impact of Clauses 1 to 4 on businesses, high streets and economic growth. There is no impact assessment published alongside the Bill that covers its first four clauses and no commitment to publish one when the multipliers have been decided. This is entirely unacceptable; it seems unlikely that the Government would pursue a Bill without clarity as to what impact it will have. In order to have an informed debate, we need to know what the Government think the material impact will be. If they are so certain that they are reducing the amount of tax that businesses pay through business rates, it would make sense to publish an impact assessment detailing how such an objective will be achieved.

My Amendment 53 is borne from the same concerns about the lack of information and asks for an annual report as to how much money is raised through the provisions in Clauses 1 to 4. Again, there is no detailed information to accompany the Bill and we are being asked to agree to a measure despite not knowing how it will impact on the very businesses it taxes. Amendment 54 seeks to include an annual report that breaks down the revenue from business rates by type of business, so that it is possible to evaluate how successful this arbitrary threshold is at placing further burdens on online giants, rather than on small and larger independent shops and pop-up businesses.

The Government have changed their tone in regard to business rates after an initial promise that they would reform the whole system to balance the scales between the high street businesses and online giants—the Bill does not deliver on that. I would be interested to see which businesses end up with a larger tax burden as a result of the Bill. I urge the Government to seriously consider these amendments.

[Lord Fox (LD)]

My Lords, as we have heard from the noble Baroness, Lady Scott, this group is about understanding the impact of the Bill. To help us focus on why this is important, my noble friend Lady Pinnock and I have produced our own notional one-dimensional impact assessment.

If a property had a rateable value of £100,000, before Covid it was paying close to £50,000 in rates. Then, when the pandemic came, if—and only if—it qualified for relief, that £50,000 would benefit from a 75% reduction. In this case, the business owner would have been paying only £12,500. Rolling forward, what do we find when the Covid relief is completely lifted? The rateable value has not changed; it is still £100,000. So, by our calculation, if—and only if—the full multiplier reduction is applied, that business will be paying £30,000 in non-domestic rates.

I am sure the Minister can spot where we are heading on this. Yes, the business will nominally have a reduction in its rates, but those are the rates it was paying before the Covid relief. In reality, it will have gone from paying £12,500 to £30,000; that is what will be hitting the business. I have two questions for the Minister. First, allowing for our slight approximations to make the maths easy, is this broadly correct and, if not, what is the actual analysis? Secondly, how on earth will this bring benefits and investment to the high street?

As the noble Baroness points out, it is right to talk about the impact assessment, both before the implementation of the Bill and once it has been implemented. The accelerated timeline for the Bill’s implementation has left insufficient time for stakeholder consultation, particularly regarding measures affecting distribution warehouses and out-of-town retail premises, as the noble Baroness just mentioned. Therefore, my noble friend Lady Pinnock and I have tabled a number of amendments to help probe different aspects of the impact the Bill will have. When we get to Report, we will hope to refine this—that is, if the Government have not put forward their own amendments, which I expect they will because this makes so much sense and is so important to the Bill.

Amendment 48 would require the Secretary of State to publish an impact assessment on Clauses 1 to 4 before they come into force—very similar to what we have just heard. Amendment 49 proposes a new clause that would require the Secretary of State to examine the effect of the introduction of the new multipliers on the amount of business rates paid by businesses occupying a single site, compared with those occupying multiple sites. This is because the relief system had a cap on it. That cap goes. The question is: does the multiplier applied across multiple sites mean that some large multisite organisations will bust the cap and benefit substantially at the expense of single-site retailers or not? Because there is no impact assessment, we have no idea. This will, essentially, help us to differentiate the effect between the size and scale of businesses.

Amendment 50 is intended to assess the cumulative impact on businesses of the changes in the Bill with the expected removal of the retail, hospitality and leisure relief—coming to the point I was just talking about. Amendment 52 proposes a new clause that would require the Secretary of State to examine the effect of the introduction of the leisure multipliers on the amount of business rates paid by businesses in different council areas. In other words, how will this affect the regional distribution? The Minister, as someone who comes from the north, will understand that there are significant differences between what happens in the north and the south-east of England. Coming from Herefordshire, I would say that there is exactly the same sort of difference there, if not even greater. Amendment 73 is consequential.

These, taken with the amendment from the noble Baroness, Lady Scott, are all about how we know what the Bill will actually do. The Government have made bold claims about the effect they assert it will cause on Britain’s high streets. On these Benches, it seems there is absolutely no way of supporting those claims because there is absolutely no data.

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[Lord Khan of Burnley (Lab)]

My Lords, I say directly again that the 2026 revaluation has not yet been completed but, obviously, the Treasury is working on it. It is having conversations with all stakeholders, of course. In fact, it is probably also looking at forward planning on the whole future of business rates. As I said on our first day in Committee, this is the start of a huge strategic focus looking at business rates; this is the first part of it. I assure colleagues that, as soon as the multipliers are announced at the Budget, noble Lords will have an analysis—not an assessment, but an analysis.

[Baroness Scott of Bybrook (Con)]

My Lords, I thank the noble Lords, Lord Fox and Lord Thurlow, for their support on what I think is a really important part of the Bill. It is not about us knowing; it is about businesses knowing. We heard very strongly from the noble Lord, Lord Thurlow, about businesses, particularly those that are around the £500,000 and do not know now whether they are or are not, and the multipliers. They are trying to plan their businesses, hopefully for growth, if we hear what His Majesty’s Government want for them, but how can they do it when they do not know what the third-biggest chunk of their expenditure will be? We are trying to get the Minister to understand how very important that is to this sector.

I thank the Minister for his response but I still think, as can be heard from the questions, that we have a lot of concerns over the lack of clarity on this and, particularly, the full impact assessments. I am more than happy to work with the Minister and the Government to find a way around this, so that we can feel comfortable—not for us, as I have said, but so that businesses can fully assess the impact as soon as possible. For now, I beg leave to withdraw my amendment.

Amendment 46 withdrawn.

Grenfell Tower Inquiry: Phase 2 Report

Baroness Scott of Bybrook Excerpts

Thursday 27th February 2025 Lords Chamber

[Baroness Scott of Bybrook (Con)]

My Lords, I thank the Minister for bringing this Statement repeat to your Lordships’ House. Sir Martin Moore-Bick and his team are to be congratulated on the work they did on the Grenfell Tower inquiry and the Government are right to have accepted the report’s recommendations. The Deputy Prime Minister, speaking in the other place, rightly recognised the suffering of the victims, the bereaved families, the survivors and those in the immediate Grenfell community.

When I was a Minister in government, I worked closely with the Grenfell community and my heart goes out to them. Their bravery and determination in campaigning for change so that this never happens again have been exemplary and, as always, I pay tribute to them all. As my honourable friend the shadow Secretary of State for Housing, Communities and Local Government said yesterday,

“The tragedy of Grenfell, which claimed 72 innocent lives—54 adults and 18 children—will always remain a scar on our national conscience”.—[Official Report, Commons, 26/2/25; col. 779.]


We on these Benches offer our sincere apologies to the bereaved, the survivors and the Grenfell community for the failures that led to that horrific night in June 2017.

Sir Martin Moore-Bick’s findings are damning, revealing decades of systemic failure, dishonesty and negligence. They are a damning indictment of successive Governments, regulators and the industry. I welcome the Government’s decision to accept 58 of the recommendations and it is right that Ministers have committed to act on them.

We support the creation of a single construction regulator, the appointment of a chief construction adviser and the consolidation of fire safety functions under one department. These reforms are long overdue. We also support steps to professionalise fire engineers and to reform the construction products sector. The systematic dishonesty from firms such as Arconic, Kingspan and Celotex revealed by the inquiry is appalling, and government must respond robustly.

The Government’s response is promising, but they must deliver proper accountability. Unlimited fines and prison sentences for rogue executives and, where appropriate, government officials cannot remain mere rhetoric. We need action urgently, and the Official Opposition will be following this closely to ensure Ministers act in a timely way.

Can the Minister explain why the Government have not accepted the inquiry’s recommendation for a single regulator to oversee the testing and certification of construction products, leaving that instead with the existing assessment bodies? We know that the Building Research Establishment was criticised strongly by the inquiry, so what steps are the Government taking to address the concerns?

We also welcome the remediation acceleration plan, but we know that the targets rely on voluntary engagement from developers. Can the Minister explain what options are available to Ministers where developers fail to comply, and will Ministers work to deliver solutions for non-qualifying leaseholders and those at risk as a consequence of other fire safety defects? No resident should be left behind.

We have concerns about the phased approach to implementation stretching beyond 2028—the Grenfell community has waited long enough for change. Can the Minister explain the reason for the delay of another parliamentary term for full delivery?

Finally, we fully support the Metropolitan Police investigation, but this must be delivered more quickly. Those who profited from cutting corners or were criminally negligent must face consequences, whether through fines or criminal sanctions. Can the Minister confirm whether the Government have reviewed existing legislation to ensure we have the appropriate laws in place to prosecute similar criminal negligence in the future?

The tragedy of Grenfell must be a turning point, and we support the Government in seeking to deliver a legacy of safety, transparency and respect for every resident. We are committed to working with this Government on a cross-party basis to meet that promise. As always, my thoughts and prayers are with Grenfell and their community.

[Baroness Pinnock (LD)]

My Lords, 72 people died in the Grenfell Tower fire seven years ago in the most horrifying of circumstances. This phase 2 report on the Grenfell Tower inquiry from Martin Moore-Bick is an excellent analysis and provides a strong challenge to the Government for the decisions they need to make.

It is therefore disappointing that the Secretary of State’s Statement fails to be absolutely clear that the recommendation from the inquiry will be implemented in full. Instead, the words used are that the Government

“accept the findings … and will take forward … the recommendations”.

That is simply unacceptable.

The inquiry exposed a culture of greed and indifference, which must be rooted out of all the organisations associated with this wholly avoidable tragedy—I emphasise that it was wholly avoidable. The Government have a duty to ensure that all buildings with flammable cladding, and where the constructors deliberately omitted fire safety features, are fully remediated, and that the cost is borne entirely by those responsible for those failings.

Leaseholders must not be required to pay anything. Living in a building that is not safe is itself a cause of immense anxiety. Added to that is the scandal of huge rises in insurance costs and service charges, when leaseholders should not be paying anything.

The ministry’s figures show that 9,000 to 12,000 buildings of above 11 metres will need remediation, yet only 4,771 have so far been identified—of which less than half have had work started. The National Audit Office has called for the costs of this work, over and above that funded by the taxpayer, to be placed on developers. That is absolutely right. Can the Minister explain how the costs of this essential work are to be met? For information, the estimate is around £7 billion.

I turn to the 58 recommendations in the report. It recommended a single construction adviser, which the Government have accepted and will appoint. I fully support that. However, Dame Judith Hackitt’s report of 2018, made immediately following the Grenfell Tower fire, also recommended that there be a formal log of every element during construction work, including building improvements which may follow. The report recommended that that log should be signed off by the person responsible for the work. This seems to be the fundamental change that is needed. Can the Minister advise whether this particular change is to be implemented?

One of the other key changes proposed by the Hackitt report was that the overall responsibility for building control should return to the local authority for independent oversight. Can the Minister explain why the Statement simply refers to a “review” of building control? Currently, constructors can appoint their own building inspector. The failure of that system is seen in the fire safety corner-cutting in Grenfell Tower and in many other buildings. Does the Minister agree that an independent building inspector is a key change that has to be made?

The failure of the regulatory system that enabled flammable cladding to be added to the walls of many high-rise blocks is at the heart of this scandal, yet the Statement has little to encourage us to believe that essential reform is coming. The Government have published a construction products Green Paper, which is positive but long overdue. The safety of construction products partly depends on the testing regime, which was exposed in the report as being deficient. What are the Government’s intentions for the future of the Building Research Establishment?

Finally, the report refers to “higher-risk buildings”. It states that

“to define a building as ‘higher risk’ by reference only to its height is … arbitrary”,

and recommends that the use of the building is vitally important. Are the Government intending to review the definition as a matter of urgency, as required by the recommendations in the report?

What is needed now is a sense of urgency and purpose. It is more than seven years since that dreadful fire. Survivors need to see that radical change is being made. The tragedy of 72 lives cruelly ended must not have been in vain.

Non-Domestic Rating (Multipliers and Private Schools) Bill

Baroness Scott of Bybrook Excerpts

Committee stage
Monday 24th February 2025 Grand Committee

[Lord Thurlow (CB)]

My apologies.

[Baroness Scott of Bybrook (Con)]

My Lords, I will speak to Amendment 1 and to my notice opposing the Question that Clause 1 stand part of the Bill. I was pleased and interested to see that the Liberal Democrats had tabled a purpose clause, given that they have criticised purpose clauses tabled by my Conservative colleagues on other Bills. On the purpose clause tabled by my noble friend Lord Davies of Gower—

[Lord Fox (LD)]

As a point of information, I have proposed purpose clauses for at least six Bills in the last three years.

[Baroness Scott of Bybrook (Con)]

I will continue. When my noble friend Lord Davies of Gower tabled a purpose clause on the Terrorism (Protection of Premises) Bill, the noble Baroness, Lady Suttie, argued that it was unnecessary because it restated some of the language in the Long Title of the Bill. In contrast to the amendment that we are debating today, my noble friend Lord Davies’s amendment included a legal duty on the Secretary of State, as well as establishing a purpose clause giving it legal effect. This is all water under the bridges, though, and we hope that our friends on the Benches to my left will not criticise our use of purpose clauses when scrutinising future Bills. As I say, we on these Benches are very comfortable with purpose clauses which seek to probe the intentions of the Bills that this Government are bringing forward, so I welcome the noble Lord’s amendment.

As the noble Lord, Lord Fox, says in his explanatory statement, there is a real question mark over the Bill’s impact on the Government’s plan to deliver on their stated aims of protecting our high streets and encouraging investment. Later in this Committee, I will seek to probe the impact of the Bill on larger anchor stores, which are often the key drivers of the footfall on our high streets and keep smaller businesses alive. I will also seek to understand more fully the impact that the Bill will have on the retail and major food shops, including supermarkets, which people across the UK rely on.

We know that the Government’s original intention was to hit international businesses that have large, warehouse-style business premises, such as Amazon and other international tech giants, but it is not clear that the Bill achieves that goal effectively. There is a risk that the increased costs of multipliers will be passed on to consumers in very unexpected ways. The higher multipliers that the Bill will introduce are a tax on business. We need to understand better what impacts this business tax will have on jobs, growth and prices. The impact assessment that the Government have published to date is utterly inadequate. Although I am really very grateful to the Minister for his engagement on the Bill so far, I feel that we will need to hear much more detail from the Dispatch Box on the real-world impact of the Bill if we are to proceed with it.

I turn to my stand-part notice, which seeks to question whether Clause 1 should stand part of the Bill. Clause 1 sets out the Government’s intention to create a system whereby hereditaments over the value of £500,000 pay at a higher multiplier. What they have failed to include in any part of the Bill, or indeed in the Explanatory Notes, is an explanation of why £500,000 was chosen as the threshold for the higher multiplier. Indeed, £500,000 seems entirely arbitrary, and the Government have not explained why that is the number.

As was mentioned by several noble Lords from across the House at Second Reading, the Bill raises more questions than it has answers, and there is a complete lack of clarity. Not only do we not know why the threshold is set at £500,000, but we also do not know what the actual multipliers will be. The Government’s choice of setting the threshold in this way means that many businesses on our high streets will be forced to pay this higher multiplier.

I agree that the business rates system needs reform, but I do not for a second think that this Bill achieves the reforms that our high streets need. There is an understanding across the board that businesses that operate online and occupy out-of-town warehouses should pay a larger amount of business rates, and such reforms have been nicknamed an “Amazon tax”. But the Bill does not achieve that on its own terms. We know that thousands of large shops will be caught by this threshold, and we cannot support a Bill that risks a decimation of our already struggling high streets across the country simply because the Government have failed to do their homework and have got their numbers wrong.

We will be probing the Government’s proposed threshold as the Bill progresses. It is the job of Ministers to get this right, and we will be listening carefully to the Government’s responses to this challenge. The Labour manifesto committed to reforming the business rates system and to

“level the playing field between the high street and the online giants”,

so why does the Bill not do that? The arbitrary threshold set by the Bill will damage many high-street businesses and, coupled with the reduction of retail, hospitality and leisure relief, will not fulfil the Government’s claims that they intend to reduce how much in business rates these businesses actually pay.

Again, the Explanatory Notes reference the higher multiplier as applying to

“distribution warehouses … used by online giants”,

but simply including a cut-off of £500,000, while it will tax online giants, will not protect other businesses. Although the majority of the businesses with a rateable value over £500,000 may be warehouses, not all of them are. Through a failure to target the policy effectively, the Bill is likely to have unintended consequences that will have a ripple effect on other businesses on our high streets.

It is important to look at this Bill in the context of the wider decisions that this Government have made that force businesses to have higher costs. The Government have increased the minimum wage, which we support, and they have increased the employer national insurance contributions—a hidden tax, a job tax, that will hit the retail sector with a bill of £2.3 billion a year. Although this Bill alone may not cripple businesses, when considered with the other taxes that the Government have imposed on businesses, it very well could be the thing that forces businesses to close on high streets up and down the country.

I thank the noble Lord, Lord Fox, who has provided a good contribution to this debate, and I hope that the Minister will consider the concerns that we have both raised.

[The Parliamentary Under-Secretary of State, Ministry of Housing, Communities and Local Government (Lord Khan of Burnley) (Lab)]

My Lords, let me start by expressing my gratitude for the kind words from the noble Lord, Lord Fox, in relation to my not being present for the Second Reading because of the tragic loss of my mother, and I extend my gratitude to everyone in the House. I had a good look at the Second Reading, and I appreciate all the tributes that were made during this difficult time of my life.

It has been a lively start to this afternoon’s proceedings, but I thank the noble Lord, Lord Fox, and the noble Baroness, Lady Pinnock, for tabling Amendment 1. It will be appropriate alongside this amendment to consider whether Clause 1 should stand part of the Bill. I understand that there is concern that the Bill before us does not deliver on the Government’s stated intentions. I am grateful for the contributions of the noble Lord, Lord Fox, and the noble Baroness, Lady Scott, but I must disagree with their position.

The Bill delivers on the Government’s commitment, as announced at the Autumn Budget, to introduce from 2026-27 permanently lower tax rates for retail, hospitality and leisure properties and, as also announced at the Autumn Budget, the introduction of a higher tax rate on the most valuable properties—those with a rateable value of £500,000 and above—to fund that permanent tax cut sustainably. Clauses 1 to 4 of the Bill enable this.

--- Later in debate ---

[Lord Fox (LD)]

The noble Earl alluded to a balloon being squeezed; we should remind ourselves that this is an expanding balloon. The costs faced by local authorities, of which a huge proportion—well over 50% and approaching 80% in some areas—is adult social care, are a rapidly expanding balloon that we are seeking to get our hands around and fill. This has enormous ramifications for not just high streets but the other services that local authorities are required and able to deliver on the budgets they get from rates and central government.

[Baroness Scott of Bybrook (Con)]

My Lords, I will speak to all the amendments in the name of the noble Lord, Lord Thurlow. I understand that he may be concerned by the lack of transparency surrounding the higher multipliers. We share this concern. We need to hear more detail from the Government. They are wrong to seek legislative powers to implement the higher multipliers without giving Parliament—and, more importantly, businesses—any clarity on what they are likely to be. We do not have an estimate of the revenue from the new multipliers. This is clearly not a satisfactory situation.

In principle, we are open to and understand the big concerns surrounding online giants, but more details are needed on this Bill, which we do not believe meets the policy aims. The principle of higher multipliers for certain ratepayers is a sensible idea when done well, so I cannot support the noble Lord’s Amendments 2 and 4. This Bill does not do it well with its arbitrary £500,000 threshold, but the principle of a higher multiplier for businesses that tend to pay less of other taxes can benefit small independent shops.

I cannot support the noble Lord’s Amendment 45—although I understand the sentiment—because, in the way the Bill is structured, high street businesses will be supporting other high street businesses through the higher multiplier. This is not sufficient reform. If we are to engage with the Bill on its own terms and seek to make it effective, the threshold will need changing the most. If the online giants were to pay a larger proportion of tax to enable a tax reduction for high street businesses, I would be inclined to support the Bill.

Before I finish, I thank both the noble Lord, Lord Thurlow, and the noble Earl, Lord Lytton, because, when you hear them talking, you will understand this sector of our economy. They understand what businesses know and think. The noble Lord, Lord Thurlow, is right to say that there should have been a much more in-depth consultation with all types of businesses, but it is difficult to do that when you do not know the effects on those businesses then or cannot give any indication whatever of that.

I also thank the noble Baroness, Lady Pinnock, because I have heard her stories of online giants in Yorkshire. I was pleased when I saw this coming, as perhaps the Government were going to deal with that issue for her. Sadly, I think they are dealing with part of it while, at the same time, putting our high streets in danger.

I am sorry that I disagree with the noble Lord that the Treasury should fund this reduction, but these are important points that the Government should consider carefully and answer fully. I hope the Minister will respond with much more clarity than so far.

[Lord Khan of Burnley (Lab)]

My Lords, I will address Amendments 2, 4 and 45 from the noble Lord, Lord Thurlow, which concern provisions relating to the new higher multiplier and the funding of the new lower multipliers.

At the Autumn Budget 2024, the Chancellor set out a Budget to fix the foundations—a Budget that took the difficult but necessary decisions on tax, spending and welfare to repair public finances, to increase investment in public services and the economy, to rebuild Britain and to unlock long-term growth. Part of that agenda included transformation of the non-domestic rating or business rates system, including delivering on the Government’s manifesto pledge to support the high street.

Support for the high street is an area on which I know that the noble Lord, Lord Thurlow, and others in this House have spoken passionately in prior debates on business rates legislation. I appreciate the depth of knowledge and experience that both he and the noble Earl, Lord Lytton, bring to these debates.

The Government have made clear that supporting the high streets is a priority. They are a focal point of economic activity and a point of local pride, and they can often reflect the unique character of a community. Yet, as they are property-intensive sectors, the Government are aware that they shoulder a significant business rates burden. Since the Covid-19 pandemic, a one-year relief has been repeatedly rolled over for retail, hospitality and leisure properties as a temporary stopgap. However, this has meant uncertainty for businesses about their business rates bills from one year to the next, and it has created a significant fiscal pressure for the Government.

The Bill will enable the Government to provide a permanent tax cut for qualifying retail, hospitality and leisure properties and, in doing so, better ensure the ongoing vibrancy of high streets up and down the country. However, against the challenging fiscal position that the Government inherited, we have been clear that we must take difficult choices to ensure that this support is delivered in a sustainable way. I repeat: the system should work in a sustainable way.

Specifically, this is why, at the Autumn Budget 2024, the Government announced our intention to introduce a higher tax rate on the most valuable properties. The amendments proposed by the noble Lord, Lord Thurlow, go to the heart of this element of the Bill. They serve to prevent the Government funding the support that the noble Lord would agree is critical for the high street from within the business rates system.

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[The Deputy Chairman of Committees (Lord Geddes) (Con)]

Amendment 3 leads a substantive group. I suggest that the Opposition might want to move it.

[Baroness Scott of Bybrook (Con)]

It is not me.

[Lord Jamieson (Con)]

May I deputise? Before I do, I declare my interest as a councillor in Central Bedfordshire. In moving Amendment 3, I shall speak to Amendments 18, 37 and 43 in the name of my noble friend Lady Scott, and in favour of Amendment 32 in the name of the noble Lord, Lord Thurlow.

Amendment 3 seeks to introduce discretion for billing authorities in the application of the higher multiplier. The other amendments in the name of my noble friend Lady Scott—Amendments 18, 37 and 43—question whether the Treasury is the right authority to define these hereditaments. The purpose of these amendments is to seek the Government’s reaction to the proposal that local authorities should have a role in deciding which businesses pay the newer, higher multiplier. Local authorities are in a unique position to comprehensively understand the challenges and circumstances faced by their local businesses, which a centralised body certainly is not.

For all its strengths, we know that His Majesty’s Treasury does not have the local knowledge and in-depth understanding of the needs of individual high streets to make informed decisions on business rates that work in the best interests of the local areas. Local authorities are on the ground and are intimately familiar with the economic, social and cultural landscape of their high streets and areas. From my own experience in Central Bedfordshire, I know the positive impact that a well-run local authority can deliver for its high streets. We are interested to hear how the Government seek to empower councils in these areas. We have heard a great deal from the party opposite about the value of devolution; this is a good example of where the Government should put these sentiments into action. The amendments in the name of my noble friend Lady Scott look to empower local authorities to tailor policy to best suit their local area’s specific needs.

Fundamentally, policy is about not only implementing rules but creating a framework that works in practice. Therefore, it is essential, even if the Government are unable to accept the amendments in this group, that local authorities are consulted properly before the Bill is passed. Can the Minister set out the consultation process undertaken to date and confirm for the Committee the further steps that his department will take to consult local authority leaders on these changes? Can he also update the Committee on how this change to our business rates system will interact with the Government’s wider plans to reorganise local authorities? We know that the environments in which businesses operate vary dramatically throughout the UK. However, this issue is neglected in the drafting of this legislation.

It is concerning that the broad applications of the definitions of hereditaments, which will be determined by the Treasury, will not address these regional disparities and enable a focus on what works locally. When created by the Treasury, definitions are designed with an overarching and national perspective and may risk creating unintended consequences for local businesses. They do not account for the nuances of local businesses, which are well understood by local authorities, so we must be cautious about adopting a one-size-fits-all approach when introducing legislation that will undoubtedly have significant implications for local businesses. The Government risk implementing blanket definitions that are disconnected from the realities faced locally.

Finally, I turn to Amendment 32 in the name of the noble Lord, Lord Thurlow, which seeks to remove the power of the Treasury to define a retail, hospitality and leisure property; this addresses the fact that it is local authorities who decide what constitutes a retail, hospitality and leisure relief property, in line with the government guidance. In tabling this amendment, the noble Lord appears to have many of the same concerns as those expressed in my noble friend Lady Scott’s amendments. I look forward to hearing his speech. We did not discuss this matter before Committee so I was pleased to see on the Marshalled List that I have a friend on this issue on the Cross Benches; I thank and offer my support to the noble Lord, Lord Thurlow, and hope that we can work together constructively after Committee.

To conclude, I hope that all noble Lords will listen carefully to the concerns raised in this group of amendments. I look to the Minister to engage proactively with the issues addressed in this amendment. I beg to move.

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[Baroness Pinnock (LD)]

My Lords, I have tabled Amendments 7 and 24 in this group and have added my name to Amendments 14, 31 and 41 in the name of my noble friend Lord Fox. I have also added my name in support of Amendments 5 and 22 in the name of the noble Earl, Lord Lytton, to which he has just spoken. This is an important group of amendments because it seeks to expose the problem that the Government have in applying a higher multiplier to some businesses without targeting them, as we heard on an earlier group this afternoon.

Searching through the Valuation Office Agency’s information reveals, for instance, that about 60 civic centres or town halls, and 80 police headquarters or very large city centre police stations, are included in this higher rate. If the top end of the higher multiplier is applied to these properties, that will add 20% to the business rates bills of those local authorities or police authorities, at a time when both have severe problems with their finances and are struggling to make ends meet.

It is not just police headquarters, police stations and town halls: 80 courts, from the Supreme Court at one end to large magistrates’ courts at the other, are included in the rateable values assessed as being above £500,000—this is in the information that the Minister shared with us at the weekend—as, indeed, are 80 prisons. I am not quite sure why the Government are including town halls, civic centres, police HQs, courts, prisons and 630 schools in the higher multiplier. Why would any Government want to impose 20% higher costs, potentially, for business rates on those publicly funded essential institutions? I am sure the Minister will have a reply; whether it is one I will accept is a different matter. It gets worse: 300 further education colleges are included in this.

We just had a skills Bill passed through this House, which purported to increase the advantages of a skills agenda for young people. Most of us know that FE colleges have been consistently undervalued and underfinanced over the last 10 to 14 years—or even more. Adding this to the list of their problems will not help the skills agenda, nor will 360 state schools. Why on earth would you include state schools in this catch-all of the higher multiplier? Within the budgets and funding for state schools there is an element to cover their non-domestic rates costs. Whether that will be increased for those who are caught up in this higher valuation remains to be seen. I am just quoting from the information that the noble Lord shared.

On top of that, 310 universities are caught up. As I declared earlier, I am a vice-chair of the University of Huddersfield. I know how hard the changes that the previous Government made have hit university funding. Across the country, universities are having to close departments—often those that are vital for the future growth agenda that the Government are following. I need to hear from the Minister how the Government will address this non-targeted way of having the higher multiplier. Will all those state-funded institutions that I listed—local government, police, prisons, courts, schools and FE colleges—be compensated for the potential higher rate multiplier and therefore the 20% increase in their business rates? Universities function as businesses now and have very little income that comes directly from government, but they are facing very challenging financial futures, which is absolutely contrary to what the Government want to achieve from their emphasis on R&D. That cannot happen if universities struggle to make ends meet.

The challenge the Government have is to ensure that the changes result in the same income from NDR as previously. Between 30% and 40% of local government funding now comes from business rate income. As well as my earlier questions, can the Minister assure this Committee that local government will have the same total funding pot from business rates as it does now and—because of the way the system works—that no local authority will suffer a loss in income from business rates as a result of these changes? I will not go into the way it works for local government. The Minister will understand that assuring the total funding pot of business rates does not necessarily mean that each local authority will continue to have the same level of funding.

The question is whether the Minister can assure us that schools, colleges and so on—all those publicly funded institutions that may have to pay considerably higher costs in business rates—will have compensatory funding from the Treasury to meet those additional costs. Otherwise, they are giving with one hand and taking away with the other.

I am going to leave my noble friend to talk about the importance of music venues. The noble Earl, Lord Lytton, knows that I support both the amendments he has tabled, to which I have added my name, and I do not wish to add anything further to what he said. I am looking forward to the Minister’s answers to my questions .

[Baroness Scott of Bybrook (Con)]

My Lords, I rise to speak to my Amendments 12, 15, 29 and 33 and, in doing so, I apologise to the Committee that I omitted to declare my interest as a vice-president of the LGA. I keep forgetting it. My amendments seek to exempt manufacturing businesses from the higher multiplier.

The manufacturing industry is exceptionally important to the British economy, and to place an additional financial burden on this sector is unsatisfactory. In 2023, the total value of UK manufacturers’ product sales was £456 billion, which demonstrates the value of the sector to the UK economy. The sector accounts for 8.1% of UK employment and, in July to September 2024, accounted for 8.8% of the total UK economic output. Ministers never tire of telling us that growth is this Government’s number one mission, so can the Minister give the Committee a cast-iron guarantee that the Bill will not have a negative impact on the growth of our UK manufacturing sector?

Recently, the global political situation demonstrated the importance of being self-reliant with the rise in energy prices we have seen in the wake of Putin’s illegal war in Ukraine. My amendments seek to protect this vital sector, which has an important role to play in growing the UK economy, by allowing manufacturing hereditaments to qualify for the lower multiplier. This Bill, despite promising business rates reform, will put an arbitrary threshold in place and many businesses will be adversely affected. We will listen carefully to the Minister’s response to this group. Given that the manufacturing sector is likely to be included in this bracket, I would be grateful if the Minister would take this opportunity to outline exactly what impact his department expects the changes to business rates will have on the UK manufacturing sector.

This sector is already facing higher costs due to the increase in the cost of labour, and the Government are hitting it with a triple whammy of increasing costs with the increase in the minimum wage, which of course we support, and the increase in employer national insurance contributions, which is a damaging jobs tax. The House will have the opportunity to debate the national insurance measures tomorrow, and we will be speaking up for the number of sectors that will be devastated by this government policy. But why would these businesses invest to increase the value of their business and risk it going over £500,000? Labour-intensive sectors are already paying the cost of a Labour Government, and if businesses are forced to pay the higher multiplier suggested in this Bill that will only worsen their predicament.

Amendments 5 and 22, in the name of the noble Earl, Lord Lytton, seek to exempt retail, hospitality and leisure businesses from the higher multiplier. They are sensible amendments, and several of my amendments touch on very similar issues. I have referred in my amendments to specific types of stores on our high street, which are yet to be debated, but the sentiment of the noble Earl’s amendments is certainly one that I support.

Amendments 14, 31 and 41 are in the name of the noble Baroness, Lady Fox, who I do not see in her seat.

[Lord Fox (LD)]

They are not from the noble Baroness, Lady Fox. They are in my name.

[Baroness Scott of Bybrook (Con)]

Once again today, I apologise to the noble Lord.

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[Lord Fox (LD)]

For the Committee’s information, there is a misprint. It should have read “grassroots music venues and larger venues”. If I had spoken before the noble Baroness, I would have explained. The Royal Albert Hall is clearly not a grass-roots venue.

[Baroness Scott of Bybrook (Con)]

That confused me, but I thank the noble Lord.

Amendments 7, 13, 19, 24, 30 and 38 all seek a similar thing: to allow the Treasury the power to exempt other hereditaments from the higher multiplier as it sees fit. While I understand the desire to introduce flexibility into a Bill that does not seem to have been fully thought through, it is important that we empower local authorities rather than afford the Treasury further powers. I look forward to the Minister’s response.

[Lord Fox (LD)]

I will speak for myself rather than the noble Baroness. What we have seen in the various themes in this group is the malign effect of a blunt instrument. My noble friend Lady Pinnock raised the important issue of public sector buildings that fall into the trap of high value and therefore the higher multiplier. Clearly, we need to understand the overall financial effects on those organisations. The noble Baroness, Lady Scott, spoke well about manufacturing. We tabled the same amendments in the Commons, where one of the implications of what the Government said was that manufacturing does not have to be in a town centre, on the basis that there is somehow an ability to up sticks and go without huge capital implications and lots of other things.

If we are talking about a mixed economy in town centres, things such as light engineering and printers, as well as other businesses such as accountants, design agencies and all sorts of things, add to their plurality and success. When you remove from a town centre the people who work or live there, you remove a huge proportion of the trade that the sector that the Government are seeking to boost relies on. Not everybody has to come in a car to buy a sandwich from a shop. They might work or live there. That is an important part of trade that this Bill seems to ignore.

I turn to my Amendments 14, 31 and 41. I was going to clarify at the beginning that the explanatory statement should have read that they are to probe the impact of the higher multiplier on large venues and, for other elements of the Bill, on grass-roots venues. There were two issues, and I somehow managed to conflate them into a mess.

I spoke earlier about unintended consequences. This Bill has lots of potential unintended consequences. The Music Venue Trust calculates that just the move from 75% to 40% business tax relief from April 2025 will create a demand for £70 million more in additional premises tax from the GMV sector, as I am going to call grass-roots music venues, that in 2024 returned an entire gross profit across all 810 venues of just £25 million. In other words, the sector will be asked for well over twice—nearly three times, in fact—what it made in profit last year. Some 43% of grass-roots music venues in the UK made a loss in 2024 and, in 2025, they continue to operate an overall profit margin of just 0.5%. This is a very marginal activity. I believe that, given the tone of the Budget and the commitment to consider the culture area of our economy in the spending review, this must have been an unintended consequence or an omission of protection, rather than an intended tax rise. I look to the Minister to confirm this.

As an aside, GMVs have specific space issues in their business characteristics that are not recognised properly in the general rateable value process. That is a separate issue with which a review would, I hope, deal.

I return to the consequences of this Bill. There are two areas. The first is an option for the Government to create multipliers that are designed specifically to encourage activity we wish to see. This goes back to the flexibility point that other noble Lords mentioned. For example, specific multipliers for cultural spaces would go a long way to support creative growth and the regeneration of our high streets, both of which are key elements in the Government’s wider agency, but there is an immediate, separate issue facing cultural spaces that operate in properties over the rateable value threshold of £500,000.

Just like schools and universities, there are big venues around the country, such as the Royal Albert Hall, the Underworld, the Roundhouse and the Royal Festival Hall—there are others, I am sure, but not a huge number—that fall above the £500,000 threshold. For those businesses, there needs to be some differentiation according to their activity. I come back to what my noble friend said about universities. Why are we including them in this measure? Why are we including police stations? Also, why are we including large-scale cultural icons? The idea of flexibility will help with other issues, about which the noble Baroness, Lady Scott, and my noble friend will talk in our debate on a future group of amendments. Without that flexibility, what we have is a blunt instrument, as I have said before.

I come back to music venues: we believe that these venues will be penalised unless something is done. Can the Minister respond to either this debate or some consultation with experts so that we can make sure that that does not happen? Grass-roots music venues are the R&D of our music industry. They are where almost every band starts. Bands start in their bedrooms, they then move to the streets, and then get to a grass-roots music venue. They may end up in the Royal Albert Hall, on television or whatever, but GMVs are where our music industry comes from. That ecosystem also supports wider nightlife and hospitality businesses in the UK, including pubs, food businesses, takeaways, taxis and nightclubs, all of which have physical premises in the community.

There are two issues here. One is the removal or reduction of relief for grass-roots music venues across the country, which will, on average, put them out of profit and into loss. The second is the application of the higher multiple on particularly large venues around this country. I do not think that the Government intended to deliver either of these outcomes for our music industry, but they must intend to improve and change the system in order for these catastrophic issues not to happen. So I hope that the Minister, either now or with consultation, can come back with two different solutions for these two sides of a very important industry.

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[Lord Fox (LD)]

I apologise.

[Baroness Scott of Bybrook (Con)]

Will the extra burdens on local authority budgets that might come be funded by the new burdens policy?

[Lord Khan of Burnley (Lab)]

Yes, that is right.

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Moved by

[Baroness Scott of Bybrook]

8: Clause 3, page 3, line 27, after “more,” insert “and is not a retail premises which is open to customers for more than 18 hours a day,”
Member's explanatory statement
This amendment, along with another in the name of Baroness Scott of Bybrook, seeks to exempt businesses that open for longer than 18 hours a day because they are often the only retailer in the local area.

[Baroness Scott of Bybrook (Con)]

My Lords, in moving Amendment 8 I will also speak to the rest of the amendments in this group. They focus on protecting the essential services that are provided up and down the high street.

Amendments 8 and 25 in my name seek to exempt community shops that are open for more than 18 hours a day. Within local communities, there is often a shop that is open for longer hours than general retail premises. Often, this can be a garage forecourt which is open 24 hours and has essential things for people working in the night-time economy, who may be on a different clock to us. These shops provide essential services for those living in that surrounding community. Without them, there may be fewer customers on that high street, which we believe would begin to damage the surrounding shops and businesses. People often rely on these stores with longer opening hours, so exempting them from the higher multiplier would ensure that they can continue to provide a vital service to local people.

My Amendments 9 and 26 seek to exempt hereditaments that have a post office on the premises from qualifying for the higher multiplier. A post office does not make the same level of profit as the shop, but it provides essential services that many people rely on. Does the Minister agree that it would be unacceptable for shops providing these services to close because they are inappropriately hit by the higher multiplier?

Amendments 10, 17, 27 and 35 seek to exempt premises shared with banking hubs. Less than two weeks ago, many in this House discussed the importance of banking hubs in a debate on bank closures and the particular impact on rural communities. The shift to online banking inevitably brings to light issues of accessibility. While digital banking services are convenient for many, they are inaccessible to others, particularly those living in rural areas. The elderly and the disabled are often significantly impacted by the lack of physical banking services. Age UK has found that over 4 million over-65s in the United Kingdom with a bank account did not manage their money online, placing them at a high risk of financial exclusion. Bank closures have also been found to negatively affect those with disabilities, with a Which? survey concluding that 50% of respondents would be negatively impacted by not having access to a physical service.

The previous Conservative Government recognised the detrimental impact of bank closures on groups in our society and collaborated with the banking industry to establish shared banking hubs. Operated by both the Post Office and banks, these hubs offer essential banking services, including cash withdrawals, deposits and in-person consultations. We must continue to look to mitigate cases of financial exclusion, and I draw noble Lords’ attention to my Amendment 26.

This group of amendments deals with a matter of utmost importance for millions of people across the UK who rely on these essential services. I therefore encourage the Minister to listen carefully to the concerns raised in the debate.

[Lord Fox (LD)]

My Lords, this is another example of the blunt instrument in operation. We have talked about increasing tax on public services, some of which have the ability to recover the money via new burdens, while some do not. But these services are offered by private sector organisations, and we know for a fact that they will not get recompense from the Government for this, which will increase their costs, reduce their profit and may eliminate their viability altogether. When post offices and Crown offices are retreating from the high street, this is not a good time for those businesses.

In a moment we will talk about flagship operations. I put it to noble Lords that banks and post offices are flagship operations. People travel to towns to visit a post office and banks, and then they spend their money on other things, so by denuding or putting in peril those sorts of operations, we are removing the attraction of town centres. We are making sure that they do worse rather than better. That is the first point.

Secondly, I have a relative who owns a shop in a country town—I do not have an interest in that shop—and one of their biggest difficulties is banking their money. They have to drive 20 miles twice a week to take bags of money to bank it because there is no longer a bank. The removal of a banking hub would make that even harder. It also drives shops to go fully digital, which means that people who do not want to use digital and want to keep using cash are no longer facilitated by those businesses. I have seen businesses that can no longer handle cash simply because they no longer have the necessary banking facilities.

Once again, we are looking at the RHL sector, but these businesses serve the RHL sector and make their lives operational. I am happy to support the various amendments in this group in the name of the noble Baroness, Lady Scott, and I look forward to the Minister explaining how taxing post offices and banking hubs will help the RHL sector in our town centres and high streets.

[Lord Khan of Burnley (Lab)]

My Lords, in her contribution, the noble Baroness, Lady Scott, said that she hoped the Minister listens very carefully. Just to reassure her, I always listen very carefully and with great interest to everything that the noble Baroness says, as is the case for all noble Lords in this debate.

Six of these eight amendments seek to change the Bill to remove certain high street services from the higher multiplier. In the previous debates on the amendments in groups 4 and 5, I explained why the Government have taken a sector-agnostic approach to the higher multiplier and have not excluded any sector or type of property. The same considerations apply here and I will not repeat them.

As regard detail, it is worth being clear what type of retail properties on the current rating list would be caught in the higher multiplier. The Valuation Office Agency’s published data shows that, of the subsector of shops that are at or above the £500,000 threshold, 72% are supermarkets, large food stores or retail warehouses. That leaves only 900 other shops at or above £500,000 across England, and of these 630 are in London and the south-east. For most regions, the number of shops affected, excluding supermarkets, large food stores and retail warehouses is fewer than 50. These numbers are rounded to the nearest 10.

In particular, the noble Baroness, Lady Scott, mentioned petrol stations, and amendments would support petrol stations but, in reality, from the Valuation Office Agency’s data, the number of petrol stations above the higher multiplier threshold of £500,000 is fewer than five.

The danger with these carve-outs from the higher multiplier is that the benefit could, in part, flow to large businesses in thriving and valuable locations, reducing the ability for us to support smaller businesses and less valuable locations through the lower multiplier. We understand the importance of facilities such as post offices or banking hubs for local communities. The average post office has a rateable value of only £16,000, so we do not anticipate that the higher multiplier will apply to very many premises used by post offices, and post offices are eligible for the existing retail, hospitality and leisure relief.

We understand that Amendments 17 and 35 seek to add to the lower multiplier hereditaments that host banking hubs. In the debate we have just had on group 4, I explained why we feel it necessary to target the lower multiplier on RHL. These amendments could easily widen the lower multiplier to other settings and introduce a loophole to the Bill. I assure the Committee that the Government will continue to work closely with high street banks to ensure that communities and local businesses have access to the banking services they need. I hope the Committee is assured that the Government remain committed to banking hubs. With these facts and assurances, I hope that the noble Baroness, Lady Scott of Bybrook, will withdraw her amendment.

[Baroness Scott of Bybrook (Con)]

My Lords, I thank all noble Lords who have supported these amendments. This group has dealt with high street services, in particular, post offices and banking hubs. While it goes unnoticed, a post office remains an essential street service, as we heard from the noble Lord, Lord Thurlow. Its use extends well beyond a mail service, and for many, particularly those without internet access, it plays a critical role in ensuring that individuals can pay their bills, collect their pension or access other financial services that a bank would traditionally offer. Indeed, they are the backbone of many of our British high streets, notably those in rural areas. As we enter a digital age, physical banking services offered by bank branches are incredibly hard to come by. When branches close, the impact extends far beyond just customers. It impacts on the whole local economy, as we heard from the noble Lord, Lord Fox, and the noble Baroness, Lady Pinnock.

Many small retailers—farmers and other independent traders—continue to rely on cash transactions. When a bank closes, cash withdrawals become harder, credit becomes less accessible and many face greater financial insecurity. In fact, bank closures may be yet another a blow to small businesses, with the Federation of Small Businesses warning that they could result in reduced

“ability to manage cash flow and productivity”.

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Moved by

[Baroness Scott of Bybrook]

11: Clause 3, page 3, line 27, after “more,” insert “and is not an “anchor store”,”
Member's explanatory statement
This amendment, along with others in the name of Baroness Scott of Bybrook, seeks to exempt anchor stores because they drive business on the high street.

[Baroness Scott of Bybrook (Con)]

My Lords, I rise to speak to Amendments 11, 28 and 36 in my name, which seek to exempt anchor stores from the scope of the proposed changes in the Bill. These amendments are crucial for safeguarding the health and vitality of our high streets particularly in the context of the ongoing challenges facing retailers and small businesses. I thank all noble Lords who, throughout this debate, have acknowledged the importance of these businesses.

As we are aware, anchor stores play a vital role in the commercial ecosystem of any high street. They act as a significant draw for foot traffic, attracting customers not only to their own establishments but to the surrounding smaller retailers and businesses. It is no exaggeration to say that, without anchor stores, many high streets would be devastated. They are the backbone that supports the smaller independent shops that contribute to the unique character of our local economies.

However, while the higher threshold for non-domestic rates is a well-intentioned measure to ensure that out-of-town warehouses and large-scale online retailers contribute their fair share, we must pause and consider the unintended consequences of this approach. The so-called Amazon tax may be designed with online giants in mind, but the current proposals would also capture larger businesses operating on our high streets—businesses that, in many cases, are anchor stores.

It is a very real concern that these stores become subject to increased rates. They may choose to relocate to out-of-town retail parks where rates are more favourable. This would exacerbate the very problem we are seeking to address—the decline of our high streets and the hollowing out of our town centres. We must ask ourselves what the impact would be on our communities if these anchor stores, which currently act as magnets for footfall, were to disappear from our high streets. Would we see a chain reaction where smaller businesses, already struggling under the pressure of rising costs and changing consumer habits, are left without customers and forced to close? How many small businesses would be driven to the brink if the larger retailers that currently support them were to move away, taking their foot traffic with them? These questions are not just theoretical; they are deeply practical and must be considered carefully if we are to protect the future of our high streets.

Amendments 11, 28 and 36 seek to exempt anchor stores from the broader measures in the Bill and offer a way forward that ensures that we do not punish those businesses that are essential for the economic vibrancies of our town centres. They are about striking the right balance. We must ensure that we support businesses that are critical to the future of our high streets and town centres. Exempting anchor stores from this measure would help to achieve this balance. I ask the Minister to consider whether the current proposals risk harming the very high streets that we all seek to protect. We cannot afford unintentionally to undermine the businesses that are central to our local economies. Exempting anchor stores is a sensible, practical step to ensure the long-term health of our high streets, and I urge the Government truly to reflect on this before moving forward. I beg to move.

[Baroness Pinnock (LD)]

My Lords, I thank the noble Baroness, Lady Scott of Bybrook, for this group of amendments which seeks to exempt so-called anchor stores from high streets.

We could do with a definition of an anchor store and, indeed, of a high street, but we will come to that in a later group. High streets vary enormously from small town high streets and market town high streets to larger town centres and city centres. When there is a new retail development in a town or city centre, the phrase “anchor store” often comes into play. It is very clear in the business sector that retail works better if there is one major store, which is a sun around which the satellites of smaller shops and businesses operate. This is the description that the noble Baroness, Lady Scott, provided. However, that is just for a group of retail businesses, often in a new situation—such as an out-of-town retail park, a new retail development within a larger town centre or an existing large business in a town centre, for example a Marks & Spencer or a John Lewis store that has a multitude of operations within it. That enables other businesses to exist and thrive from the footfall that the big name store attracts.

I agree with the noble Baroness, Lady Scott, about the importance of these so-called anchor stores, although I would like to see whether the Government have a definition that can be applied. I agree with her argument that smaller businesses develop and thrive as a result of the draw of a so-called anchor store and, equally, the argument that she makes that, because anchor stores are critical to the business environment for the totality of large, medium and small businesses—retail, leisure, hospitality or otherwise, within the sector—it is important to think about whether those often large retail businesses are exempt from the higher multiplier.

I am thinking of a local town high street where the Marks & Spencer closed and moved out some years ago. It was absolutely clear that that was the focus of shoppers going to that town. Once it went, it caused the closure of a whole section of shops in that town and very difficult situation for the businesses that were left. The town will require government money for regeneration to get back on its feet. That is what happens.

So it is important that the Government, in thinking about the Bill and the impact it will have on businesses, think about the consequences of what they are doing. In a previous group, I raised the consequences for public sector-funded businesses, but this is as important for the future health of our town centres. If you take out the key store around which others, like satellites, are drawn because its business sums no longer add up, the whole area will be on a downward spiral.

I will give the Committee an example from some figures that I remember, so they may be wrong. Take John Lewis, which is a big store. It knows that much of its business will move online. I think its business plan expects 60% of its business to move online. If we put an additional cost, as would happen under the large multiplier, on the remaining 40% of its business, I expect that one of the consequences would be that a greater proportion would move out of the high street to online to reduce those costs. That is not what this Government want to happen. They have argued for the importance of the health of our town centres for all sorts of reasons, not just to support small businesses but to support the community which goes there to meet and so on.

It is important that the Government think about the unintended consequences of this rough and ready Bill because it will potentially have very rough consequences on our high streets, particularly those which depend on a big store as the holder of the rest of the businesses around it. I look forward to what the Minister says, but I hope that he does not use “tough choices” and “fair and sustainable”.

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[Lord Khan of Burnley (Lab)]

My Lords, these amendments seek to change the Bill to remove anchor stores from the higher multiplier. I apologise for being repetitive, but as I explained in the debates on the previous three groups of amendments, we have taken a sector-agnostic approach to the higher multiplier and not excluded any sector or type of property. This is the fairest option.

We have also ensured that the Valuation Office Agency has published data on those properties currently falling within the threshold for the higher multiplier. This shows that the impact on high street shops is very limited. I will not repeat those numbers at this time but encourage noble Lords to look at that information.

Alongside noble Lords, we of course appreciate the role anchor stores can play in the high street, but it should be acknowledged that anchor stores are often part of large retail chains that will also have a number of properties with a rateable value of below £500,000. Where retail properties’ rateable value is below £500,000, they will benefit from the lower tax rates for qualifying retail, hospitality and leisure from April 2026.

The amendment would also be difficult to operationalise and would require the Government to define the meaning of an anchor store. It would be very difficult to define these stores in the way that the noble Baroness is thinking. There are anchor stores in almost every out-of-town shopping centre and retail park, and what is an anchor store beyond a large shop?

While I understand the concerns of the noble Baroness, I do not think it follows that we should exempt anchor stores from the higher multiplier, nor do I think that this can easily be done without, in effect, removing all shops. Some very difficult decisions have been made, and we need to ensure that the system is long-standing and continues in a fair manner. I hope, therefore, that the noble Baroness, Lady Scott of Bybrook, will withdraw the amendment.

[Baroness Scott of Bybrook (Con)]

My Lords, I thank the noble Baroness, Lady Pinnock, the noble Lord, Lord Thurlow, and all others who have mentioned this issue throughout the afternoon. There is an important role for anchor stores. To the definition, with the greatest respect to the noble Lord, I suggest that they should ask communities and their residents what would be an anchor store in their local town centre and ask the sector to discuss that as well. As a former leader of a council for many years, and knowing many council leaders, as I do, I know that they know exactly what an anchor store at any one time would be for the size and type of the high street they are trying not only to protect but to keep being a high street for any length of time. Many leaders of councils across this country have spent many hours working with the sector to get exactly that in order to make sure that they have a good thriving and surviving high street for their local communities.

As we have said, we all agree that these stores play a crucial role in the vitality of high streets and town centres. We know that they drive footfall, support local businesses and contribute significantly to the economic and social fabric of our communities. That is why it is important that we find a definition and a way through this. Without them, many of our high streets will struggle to survive, let alone thrive. I have spoken to the sector, and these businesses will leave the high street and go out of town where it is cheaper. Not only that, but they may even go out of business and, as we are seeing, go permanently online. That will not help our high streets.

As I have said, the changes in the Bill could inadvertently harm these vital businesses and place an undue burden on them, pushing them out of our high streets. The Bill follows several other damaging decisions that businesses are having to fund. This one at the end of it could be the straw that breaks the camel’s back. Not only will it likely leave anchor stores paying higher business rates; they will also be paying increased staff costs, as we talked about earlier.

These decisions will have a cost, and if the Government continue to make them, we are worried that there will be no businesses left in the high street to tax. I urge the Minister to carefully consider the concerns raised by many noble Lords today. We just want a fair and equitable business rates system—

[Baroness Pinnock (LD)]

“Fair and sustainable”.

[Baroness Scott of Bybrook (Con)]

And equitable. We must not overlook the specific need, as we have all said—across parties—to protect our high streets for our communities for the future. We believe that exempting anchor stores from these changes is a measured and practical way of safeguarding the future of our town centres. I hope to have further discussions with the Minister on this before Report but, at this point, I beg leave to withdraw my amendment.

Amendment 11 withdrawn.

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Moved by

[Baroness Scott of Bybrook]

21: Clause 3, page 3, line 37, at end insert—
“(9D) In sub-paragraph (9B) the £500,000 threshold must be increased on 1 April each year by at least the CPI.(9E) The CPI is the Consumer Price Index percentage recorded by the Office for National Statistics for September of the financial year preceding the relevant year concerned.”Member’s explanatory statement
This amendment, along with others in the name of Baroness Scott of Bybrook, seeks to increase the £500,000 threshold with inflation to ensure businesses don’t get drawn into the higher rate.

[Baroness Scott of Bybrook (Con)]

My Lords, Amendments 21, 40 and 44 in this group seek to introduce a statutory index-linked uplift in the threshold for the higher multiplier in line with inflation. These specific amendments relate to the level of the threshold in future years, so I am grateful for this opportunity to have a brief and specific debate on the threshold.

We have already probed the Government over their arbitrary threshold of £500,000, but I hope that, in response to this group, the Minister will be able to explain the Government’s current plans for uprating the threshold in future. There are no measures in the Bill to prevent more businesses being caught by this threshold over time. We are told that it is not the Government’s intention for smaller high street businesses to be hit by the higher multiplier, but inflation and a fixed threshold mean that that will be an inevitable result of this policy. I remind the Committee at this point that, thanks to the Government’s Budget measures, inflation rose by 3% in the 12 months to January 2025, up from 2.5% in the 12 months to December 2024. As the hereditament valuations rise over time, more and more businesses will be paying higher business rates.

If the Minister feels that the CPI is not the correct index to tie this threshold to, we are open to discussions about that. Our goal here is to probe the Government’s willingness to explore increases in the thresholds going forward to protect small businesses that should never have been caught by the higher multiplier threshold from facing higher taxes by the back door. Can the Minister confirm that it is not the Government’s intention for smaller businesses to be hit by these higher taxes? If the Government do not intend to hit smaller businesses with higher taxes, can the Minister give us an undertaking to look at the threshold and consider including in this Bill a measure that would deliver either an index-linked uprating of the threshold or, as a minimum, a power for Ministers to uprate the threshold without having to bring primary legislation before the House again? We are generally cautious of new regulatory powers but, provided that a power was limited to uprating and excluded the possibility of lowering the threshold, that might be a way forward. I beg to move.

[Lord Fox (LD)]

My Lords, I think this might be the last group today; I would say that we have done very well to get this far. I shall speak to these four amendments. The first three make an assumption that the £500,000 threshold was right in the first place. Of course, that is really addressed by the fourth amendment, so I am going to speak to it. It is right that there should be some form of uprating, but I am more intrigued about how the figure of £500,000 was alighted on in the first place.

If we were looking at something that was broadly financially neutral, I do not know how we would know, because we do not know how the flexible upper rate will be applied, so we do not know how much money that will raise. We therefore do not know whether £500,000 was the right number to make it financially neutral. Was it chosen for a business reason? Are businesses of that size particular sorts of business that we need to factor in, in a different way, or was there some other sociological plan involved in choosing £500,000? My big question for the Minister is who chose the number. Was it DHCLG or the Treasury?

--- Later in debate ---

[Lord Khan of Burnley (Lab)]

My Lords, Amendments 21, 40 and 44 concern the rateable value threshold above which the higher multiplier may apply. This is set in the Bill at no less than £500,000, as we have heard repeatedly in contributions by noble Lords. The Bill allows the Government to set a higher threshold through regulations if they wish, but the amendments would require this threshold to be increased annually in line with CPI.

Alongside the amendments, the noble Baroness, Lady Scott of Bybrook, has given notice of her intention to oppose Clause 3 standing part of the Bill. It would therefore be appropriate at this point if I set out why Clause 3 should stand part.

The noble Baroness, Lady Scott of Bybrook, raises a reasonable question as to whether, and if so how, the £500,000 threshold should change over time and other noble Lords have also raised this point. Of course, we would expect that, over time, the value of properties and therefore their rateable values will increase as the economy grows. As these rateable values grow, the current threshold in the Bill of £500,000 will, relatively speaking, be smaller and more properties may be drawn into that category. That is the issue that the noble Baroness is probing with these amendments.

However, I do not think these amendments are the answer to that issue. First, and perhaps most importantly, rateable values will not increase annually in line with inflation or with any other measure of property value or the economy. Rateable values are set every three years at revaluations, and between those revaluations will not change other than for matters such as physical changes to the property.

The Government have set out that our intention for the 2026 rating lists is for the threshold for the higher multiplier to be set at a £500,000 rateable value. The Government consider that this will best ensure that sufficient revenue is raised to provide for a meaningful level of support for retail, hospitality and leisure properties, and will do so in an objectively equitable way.

The 2026 rating list will last for three years, and those rateable values will not increase over that period, other than if, as I have said before, the property is expanded or improved, for example. By extension, the 2029 revaluation will be the next logical moment to consider whether the £500,000 threshold remains the appropriate minimum for the new higher multiplier.

In approaching these considerations, the Government will need to examine how rateable values have changed at the revaluation but also what support is to be provided to retail, hospitality and leisure properties and, consequently, how much revenue is needed to be raised from the higher multiplier.

I hope the noble Baroness will appreciate that there are several factors the Government will need to consider and balance, beyond just the changes in rateable value. More broadly, as the noble Baroness will be aware, the Government keep all taxes under review, including rates and thresholds. As such, I can assure the Committee that in relation to the proposed amendment, the Government will, as a matter of course, actively consider whether the £500,000 threshold in the relevant regulations should be amended at the 2029 revaluation, as they approach that revaluation.

The noble Lord, Lord Fox, asked whether MHCLG or the Treasury decided. It was the Government who decided. As much as I love darts, it definitely was not a dart-throwing exercise.

I will now expand further on Clause 3 so that, I hope, noble Lords can agree that it should stand part of the Bill. We have discussed several amendments in relation to Clause 3 today, so I shall try to keep my remarks to the point and not go over previously covered ground too much.

Clause 3 is concerned with how we will determine to which hereditaments those multipliers should apply. It is split into three main parts, concerning occupied hereditaments in Clause 3(2), unoccupied hereditaments in Clause 3(3), and hereditaments on the central rating list in Clause 3(4). Properties on the central list are typically utility networks spanning many local authority areas, such as the gas, electricity and water networks. Each of these parts of Clause 3 are essentially identical, so to save the Committee from repetition, I will explain the provisions on occupied hereditaments in Clause 3(2) only.

The most important part of Clause 3(2) is the small amendment made by Clause 3(2)(a) to existing powers in the Local Government Finance Act 1988. Under those existing powers, the Treasury already has the ability to determine in regulations which multiplier applies to which property. Those powers, in respect of occupied properties, are in paragraph 10(9) and 10(10) of Schedule 4ZA to the 1988 Act. Clause 3(2)(a) amends that part of the 1988 Act to extend those powers to cover also the new additional multipliers. This means that the Treasury will be able to determine by regulations which properties pay on which multiplier.

As with Clause 1, we have included in Clause 3 safeguards as to how the Treasury may use these powers. These limit the higher multipliers to hereditaments with a rateable value of £500,000 or more and limit the lower multipliers to only qualifying retail, hospitality and leisure hereditaments.

Finally on Clause 3, the existing powers for determining the application of the multiplier allow the Treasury to do that by reference to a list of factors found in paragraph 10(10) of Schedule 4ZA to the 1988 Act. This is a non-exhaustive list that includes factors such as its rateable value, location or use. Clause 3(2)(c) expressly gives the Treasury the scope also to determine the application of the multipliers by reference to the description which the Valuation Office Agency puts in the rating list.

I hope that this further information provides the reassurance and clarity needed for the noble Baroness to withdraw her amendment and agree that Clause 3 should stand part of the Bill.

[Baroness Scott of Bybrook (Con)]

My Lords, I thank the noble Lord for speaking in this debate. He actually brought today’s debate right back to the beginning: where did the £500,000 figure come from? If we could get that from the Minister, it would be very useful for our debates as we enter Report.

The answer to whether there will be any further uplifts, is, I understand, the revaluation, which is in three years, but three years could go on. I go back to the difficulty that this makes for businesses to plan when they know they are going to hit that cliff edge of £500,000 and that their business rates are going to go up considerably. I go back to the example of my noble friend Lord Jamieson, who gave the example of the health centre that wants to build an extension, which could possibly move it across; the health centre would need to think very seriously about doing that extension, and this will happen across all investment in different types of businesses, which I think is worrying.

This is something that we could resolve together by a relatively straightforward amendment to the Bill, and I hope that the Government will do the right thing in protecting these smaller businesses from being hit with higher business rates inappropriately in the future. But, at this point, I beg leave to withdraw my amendment.

Amendment 21 withdrawn.

Holocaust Memorial Day

Baroness Scott of Bybrook Excerpts

Thursday 13th February 2025 Lords Chamber

[Baroness Scott of Bybrook (Con)]

My Lords, I thank the Minister for bringing this important debate to your Lordships’ House today. It has been my solemn duty to bring this debate to the House in previous years, and I congratulate him on his speech. I too am looking forward to hearing the maiden speeches of the noble Lords, Lord Evans of Sealand and Lord Katz, and the noble Baroness, Lady Levitt. I know the whole House will join me in welcoming them.

On Holocaust Memorial Day every year, we remember the unspeakable crimes of the Nazi regime against the Jewish people. We remember also the many political prisoners, Soviet prisoners of war, Polish, Roma, Sinti, lesbian and gay victims of the Holocaust.

It is on Holocaust Memorial Day that we remember the unique evil of the Holocaust: the killing of Jews because they were Jews, as part of the Nazis’ plan to wipe out the entire Jewish people. The history of the Holocaust is a bitter truth, and we must never shy away from repeating that truth. Auschwitz, Dachau, Bergen-Belsen, Majdanek and Treblinka are just some of the haunting names of the places where Jews were imprisoned, beaten, worked to death, tortured and exterminated—murdered because they were Jews.

Not all the names of the Nazi camps are so familiar to us. Auschwitz and Bergen-Belsen were just two of over 1,000 concentration camps operated by the Nazi regime for the mass persecution and murder of Jews and its other victims. Eighty years ago today, on 13 February 1945, Soviet forces liberated Gross-Rosen concentration camp. By 1945, there were no Jews left at Gross-Rosen because, on 2 December 1941, the head of the camp, Anton Thumann, gave the order that

“no Jew is to remain alive by Christmas”.

On 12 October 1942, the last 37 living Jewish prisoners were sent to Auschwitz.

Isaak Egon Ochshorn, a Jew who was in Gross-Rosen from June 1941 to October 1942, before being transferred to Auschwitz, gave evidence after the liberation of the camps that showed the appalling treatment of Jews at Gross-Rosen. He said:

“The sport of Commandant [Thumann], favoured in winter, was to have many Jews daily thrown alive into a pit and to have them covered with snow until they were suffocated”.


We must never forget.

In this the 80th year following so many liberations, we must also remember that liberation was not the end of the story for the victims and survivors of the Holocaust. Many Jews died early because of the harm the Nazis did to them during the Holocaust. The wounds of families that were broken by the Holocaust were felt for many years and are still felt today.

Holocaust Memorial Day was intended to be a reminder of the suffering of the Jewish people in the past, but we sadly know that Jewish people are still not free from persecution. As we heard from the Minister, since 2023 we have seen a shocking rise in anti-Jewish racism on our streets, online, and in our schools. In 2024, the Community Security Trust recorded 3,528 anti-Semitic incidents in the United Kingdom, the second-highest total ever reported to the CST in a single year, second only to the 4,296 recorded in 2023.

Anti-Semitism in this country is growing, and it is shaming that the spike in anti-Semitism we have seen over the past year has directly followed the worst massacre of Jews since the fall of the Nazi regime. When I moved this debate last year, just months after the pogrom of 7 October, I recounted the story of 91 year-old Moshe Ridler, a Holocaust survivor murdered in Kibbutz Holit, just over 1 mile from the border with Gaza. His home was hit by a rocket-propelled grenade and then by a hand grenade. To his 18 children and great-grandchildren, may his memory be a blessing.

The deaths of the 1,200 people who were murdered in the 7 October pogrom, as well as the ongoing suffering of the hostages and their loved ones, remind us that the work of organisations such as the Holocaust Memorial Day Trust and the Holocaust Educational Trust has never been more important. I put on record my thanks to the CEO of the Holocaust Educational Trust, Karen Pollock CBE, who does so much important work to ensure that our children and grandchildren are taught about the horrors of the Holocaust. I also thank the Holocaust Memorial Day Trust, its CEO, Olivia Marks-Woldman OBE, and her team, which delivers the annual Holocaust Memorial Day ceremony and thousands of local activities across the country.

Eighty years on and still the Jews across the world experience persecution, discrimination and, at worst, fear for their lives. That is the imperative of our commemoration: we must not merely ensure that the Holocaust is never forgotten; we must remember, actively reflect on and learn about the unique suffering of the Jewish people in the Holocaust. We must teach it to our children and remind our neighbours of the insidious threat of anti-Semitism. We must never forget—and we must hold to the promise, “Never again”. Only by keeping our covenant to remember may we hope to end anti-Semitism for good.

I look forward to hearing the reflections of noble Lords across the House. My thoughts and prayers are, as always, with the victims and survivors of the Holocaust and their families.

English Devolution and Local Government

Baroness Scott of Bybrook Excerpts

Wednesday 12th February 2025 Lords Chamber

[Baroness Scott of Bybrook (Con)]

My Lords, the Government’s announcement on local government restructuring is a hugely significant upheaval for local democracy. We support the principles of devolution, but we do not support the Government’s method of achieving it. No council should be bullied or blackmailed into top-down restructuring. This was not in the Labour Party manifesto, and the Labour Government have massively rushed this whole exercise.

The Conservative Party has a proud record of supporting devolution. While we were in government, we empowered residents and their councils. We gave councils more control over local planning, improved accountability through elected mayors and police and crime commissioners, and decentralised power to the people by letting parents create free schools and giving residents power over neighbourhood planning.

In December 2024 we set out five tests for the Government that we believed any form of devolution should satisfy. Is this a genuine choice for local councils? In two-tier areas, do both district and county councils agree with restructuring? Will local government be more accountable to local residents? Will the overall changes help keep council tax down? Finally, will restructuring avoid disruption of social care?

We already know that the Government have failed each of these tests. Restructuring is compulsory. There has been no attempt to gather consensus within two-tier areas. Residents have not been consulted, and there has been no time for proper communication with local people about the plans that local councils are putting in place. The Government are incentivising council tax rises across the board—no, worse: punishing councils that keep council tax down. I have not been reassured by the Government that they understand the needs of adult and children’s social care, and the impact that this could have on it, compounded by Labour’s national insurance hikes. Nevertheless, I would be grateful if the Minister could address these five points in turn, and explain what consideration the Government have given each of them.

The shadow Secretary of State in the other place, Kevin Hollinrake, asked a number of questions of the Secretary of State, Angela Rayner, that went unanswered. Now the Government have had more time to consider these serious and reasonable questions, I ask the Minister to answer some of them, but this time with substance and not politics.

First, how exactly will this restructuring put more money into people’s pockets? How is it compatible with Labour’s changes to the local government funding formula that punish councils that keep their council tax low? Do the Government accept that these changes, which will mean that every single council employee in two-tier areas has to reapply for their job, will have an impact on local services, including planning delays? How will this impact on the Government’s plans to deliver 1.5 million homes in this Parliament? Finally, what support will the Government give to authorities—such as Woking and Thurrock—facing significant levels of debt? Will this debt be written off or passed on to the new unitary authorities?

We support stronger local accountability, but there are different ways to do this, and there should have been proper, full and open consultation. Local government must remain local and accountable to its residents. The whole process should be considered more slowly, to ensure that the people understand their future representation and have their say on it.

[Baroness Pinnock (LD)]

I remind the House that I have relevant interests as a councillor and as a vice- president of the Local Government Association. This is a wide-ranging Statement about the future of local government. There are three different elements within the Statement, and I want to address each separately.

First, I want to think about the creation of the so-called strategic authorities. The Government, in the headline to their Statement, described it as “devolution”. It is not devolution; it is delegation of powers from the centre in Westminster. True devolution will occur only when funding is raised locally and decisions are made locally, without the iron grip of Whitehall being exerted. This is a bit of a challenge for the Minister: if they are to have devolution, can she describe the route to the place where there is freedom for local government to make and fund its decisions, without the diktat from above?

The next challenge I have for the Minister—I am sorry, there are one or two here—is that of the democratic deficit that is being deliberately created. We are, apparently, going to have mayors for these so-called strategic authorities. If the evidence from the past in the election of mayors is to continue, mayors are elected—when they are stand-alone elections—by less than 20% of the electorate, which is hardly a resounding vote of confidence in that system. Those of us who care about local democracy are rightly concerned about increasing powers. For example, the mayors of the strategic authorities will have the power to create policy on housing and on strategic planning, which really affect the lives of residents. How will those decisions be respected when the mayors have been elected by such a low number of electors?

One small step that the Government could take to help reverse this democratic deficit is to return to the voting system that prevailed in the election of mayors until the previous Government, in their last throes, decided to remove the additional vote system and return to first past the post. I guess they thought it would help their cause; it did not. At least having an additional vote—albeit that is not what would I want—means that more people help to support the person who is elected.

The next element of the Statement is the abolition of district councils. I serve on a metropolitan council, so district councils are not anything I have experienced, but we know that they are very efficient in running very local services and are very close to the residents they serve. Systems always need reform, so if there is going to be reform of this two-tier system, why do we not think of change rather than abolition? Is it because the county councils are running out of money, and they need the district council reserves to prop them up?

In the new era of unitary authorities, the Government are talking about the average size of these unitary authorities being a population of 500,000. That is very much like the metropolitan area that I serve in. I can tell the House that this means that the wards that councillors will be elected to serve in will be large, and in rural areas they will be geographically large. I suspect that the Government are considering a ratio of councillor to electors of about 1:5,000. That is a very large number of people, and it would take local democracy away from people.

The last item I want to raise is the cancelling of elections. I do not think that, in a democracy, we should ever cancel elections. I know that the previous Government cancelled elections, so there is a bit of a precedent, but I do not think that it is one that should be repeated. People have a right to have their say in electing people to represent them. The difficulty that cancelling these elections creates is that the existing councillors who were elected four years ago will be the ones who determine the set-up for the new unitary councils in their area. If you do that you need the electoral mandate to do it, which they will not have.

I am very disappointed that the Government have decided that democracy is not worthy of the name, and that we are moving local government further and further away from local people. I hope that the Minister will be able to answer my questions and put some life back in local democracy.

Local Government: Electoral Quotas

Baroness Scott of Bybrook Excerpts

Tuesday 11th February 2025 Lords Chamber

[Baroness Taylor of Stevenage (Lab)]

I have heard this view from the Liberal Democrats for many years in local government. The first past the post system means that the electorate decide who is in charge of our local councils. That is up to them. It is a straightforward system which is widely appreciated by the people who engage with it. That is not to say that we cannot do more to encourage involvement in local elections. We will continue to do so.

[Baroness Scott of Bybrook (Con)]

My Lords, if His Majesty’s Government do not have any plans to restructure London councils or any other metropolitan areas such as Manchester or Birmingham, can the Minister explain why the Government believe that those living in more rural parts of our country deserve less representation than those living in our cities?

[Baroness Taylor of Stevenage (Lab)]

We believe that everybody should have proper representation. While we are undergoing the devolution programme in the rest of England, we will not be looking at those metropolitan areas, but that is not to say that it will never happen.

Renters’ Rights Bill

Baroness Scott of Bybrook Excerpts

Tuesday 4th February 2025 Lords Chamber

[Baroness Scott of Bybrook (Con)]

My Lords, I declare my interest as set out in the register as vice-president of the Local Government Association. I very much look forward to the maiden speeches of the noble Baroness, Lady Brown of Silvertown, and the noble Lord, Lord Wilson of Sedgefield, and welcome them to the House.

The Renters’ Rights Bill is counterproductive. While the Government may have good intentions, they will drive landlords from the market—reducing choice and putting up rent for the tenants they seek to protect. While we discuss this Bill, it is important to remind ourselves who landlords are: around 45% own one rental property, with another 40% owning two to four. In many, if not most, cases these are not professional landlords; they may have gained an extra property when a family member has died or through marriage later in life, or perhaps they invested in a property or two to use as a pension. To expect them to be able to cope with all the costs and burdens placed on them by this Bill is at best naive. Many decent landlords and safe, quality homes will leave the rental market as a result.

We must absolutely deal with bad landlords, but in most circumstances there is no reason a good landlord would want to lose a good tenant. It is in their interest to keep a steady income from a reliable tenant who respects their property. Having an empty property is expensive, and there are significant fees and paperwork involved with finding a new tenant. While trying to protect and improve living conditions for renters, the Government should be very careful not to do the opposite and make it worse for them.

The last Conservative Government introduced our own version of this Bill, the Renters (Reform) Bill. It was first introduced to the House of Commons in May 2023 and eventually had its Second Reading in your Lordships’ House in May 2024, but was not taken any further before the general election. The Bill did not make quick progress because we wanted to take our time to get this right. We listened to representations from the sector and carefully considered the impact of our policies. We made changes during the Bill’s passage through the House of Commons, most notably on the readiness of the courts, and further changes were planned for the House of Lords, most notably to carve out student lets.

We recognise that some reform to our rental market was necessary to protect tenants from the abuse at the hands of rogue landlords, but it was always important to us that we balance the rights of tenants to live safely and peacefully in the homes they were renting with the rights of landlords, particularly with respect to their property rights.

The Government were trying to balance the see-saw, and I know we did not get everything right. Many felt that the measures introduced by the Bill went too far in favour of tenants and too far against the landlords in a way that would work to the detriment of the rental market, and I have sympathy with that. However, we listened to the concerns that were raised and we were making changes to the Bill as it progressed.

If the Renters (Reform) Bill did not quite balance the see-saw, the Renters Rights’ Bill tips it over. This is not the same Bill that the last Conservative Government introduced, and the Government are rushing it through without any care for the repercussions that will reverberate throughout the sector. Labour has abandoned our commitment to improvements in His Majesty’s Courts & Tribunals Service before abolishing Section 21 for existing tenancies, as well as our six-month implementation period before abolishing Section 21 for new tenancies. This means that our courts will not be resourced as they need to be. Labour has also abandoned our requirement for the Lord Chancellor to assess the courts’ possession processes before abolishing Section 21 for existing tenancies, which would have ensured that they were ready for the changes first.

Labour has abandoned our plans that would have stopped tenants being able to give notice during the first six months, to give landlords some predictability and protect them against tenants seeking to exploit these new arrangements for rolling tenancies such as holiday lets. Labour has abandoned our plans to make it easier to remove anti-social tenants, which we were changing from “likely” to cause a nuisance or annoyance to “capable” of doing so, making it much harder to evict those who deserve to be evicted. Labour has also abandoned our commitment to sufficiently carve out student accommodation, where it is essential that both landlords and tenants have the certainty of fixed-term contracts to plan for subsequent years.

Not only have the Government removed many of the safeguards and improvements for landlords that we put in the Bill but they have added many concerning measures of their own. They are increasing the mandatory eviction threshold for rent arrears from two months to three months, significantly increasing the loss incurred by landlords when a tenant is not paying for the property they are occupying. They are shortening the time limit for landlords to consider a pet, which we know to be a significant issue. They are rushing, in our opinion, the implementation for the private sector of Awaab’s law—a law that was designed for the social housing sector and that could have significant implications for smaller landlords if not implemented very carefully.

If that was not enough, Labour took the Bill even further, through the amendments it made in the House of Commons. It introduced amendments to include restricting the payment of rent in advance, which will hit most severely self-employed renters and those with bad credit ratings, where a landlord is now even less likely to want to take the risk on them. It introduced amendments requiring landlords to pay compensation to tenants when they possess their properties, burdening landlords with even more unfair costs, even if they have no choice but to take their property back and may have already spent a lot of money to do so.

Much has changed since the original Bill was introduced, and we must acknowledge the broader context that the Bill and the sector find themselves in. Landlords are leaving the rental sector at a higher rate than ever, with many citing rental reforms as their reason for leaving. Rightmove has estimated that 18% of homes up for sale were previously rented, compared with 8% in 2010. In London, where we know the problem in the rental market can be most acute, the situation is even worse: 29% of homes for sale in our capital city were previously rented out.

On top of this inflated package of rental reforms, landlords now have the minimum energy-efficiency standards to contend with. Ed Miliband, the Secretary of State for Energy Security and Net Zero, is requiring all private and social rented homes to meet EPC C by 2030. The industry estimates that this could cost the sector £25 billion—an average of £5,400 per home. This is a cost that many landlords, particularly those with only one or two properties, just cannot take.

Of course, this is set against a backdrop of ever-increasing taxation from a Government who do not understand how our economy works. All these issues compound to make our country an unattractive, burdensome and expensive place to be a landlord, however fair and decent one might be to their tenants.

There is always a balance to be found with legislation, and in this case respect for property rights is essential for investment and stability. I would expect the risk of legal challenge on this Bill to be very high. There will certainly be a few interested parties queuing up to challenge the Government over the rights to their own property. If the Government are not careful, and continue with such an aggressive pursuit of landlords, there is a good chance that their Bill will get stuck in the courts and not be able to benefit anyone.

In Scotland, similar legislation has resulted in the highest rent increases in the United Kingdom because of demand far outstripping supply. The Nationwide Foundation found that 70% of landlords and letting agents lack confidence in the future of the sector. This has led to a significant reduction in rental stock, which has made it much more difficult and expensive for tenants, especially those on low incomes, to find a home. We must learn from Scotland’s mistakes.

There will always be people who want, or need, to rent rather than buy their home. We must ensure that there is a stable rental market for them, and we will do all we can to convince the Government to think carefully about how they proceed. We intend to table amendments to address some of the most pressing concerns, including: the capacity and operation of the courts; student landlords, who need certainty of length of tenure and other mutually agreeable fixed-term contracts; some exemptions for smaller landlords, who are less able to weather these changes; the availability of insurance for damage caused by pets; consideration of the property rights of landlords; and the impact on the housing market. We will pursue these amendments for the benefit of landlords and tenants alike, because we know what will happen if we do not.

The Government’s own impact assessment acknowledges that tenants will see increased costs as a result of their policies, saying

“it is likely that landlords will pass through some costs of new policies to tenants in the form of higher rents—to offset those costs and maintain a degree of profit”.

Surely the Government cannot want this, and I hope that they will listen to the concerns being raised by the sector and by many noble Lords across this House before it is too late.