Universal Credit (EAC Report)

Baroness Valentine Excerpts

Wednesday 23rd March 2022 Grand Committee

[Baroness Valentine (CB)]

I am grateful for this opportunity to discuss this important topic. I will focus on one particular aspect of universal credit: housing benefit. I should first say that I work part-time for Business in the Community on levelling up left-behind towns, in places such as Bradford, Rochdale and Sheffield. Each of these towns has their own unique strengths and challenges. In passing I should say that I am delighted that Bradford has just been shortlisted for City of Culture, which would give the city a tremendous boost.

The place on which I want to concentrate is Blackpool, which, according to Zoopla, provides a gross annual yield to buy-to-let investors of 8.6%, the second best in the country. So far so good, but now let us look at the living conditions in those buy-to-let houses. Blackpool has about 4,000 private rented units in the centre of town, the legacy of bed and breakfasts that did not keep up with the more modern hotel accommodation that is now available. Many of these B&Bs have been converted to houses in multiple occupation and those HMOs are located in eight of the 10 most deprived wards in England. Life expectancy in this area is the worst in England.

Some 80% of these tenants rely on housing benefit or universal credit. While tenants in social housing can rely on the decent homes standard, there is currently no quality assurance for a private landlord receiving housing benefit. Therefore, if you are motivated only by money, or indeed absent and unaware of local conditions, the incentive is to squeeze in as many people as possible, leading to those profitable yields that I mentioned. Not only are these people crammed in, but the conditions are appalling. It is estimated that one in three of these buildings has a category 1 hazard. This type of hazard is defined as

“the most serious harm outcome … for example, death, permanent paralysis, permanent loss of consciousness, loss of a limb or serious fractures”.

I am delighted to say that two Secretaries of State had the chance to see these dreadful living conditions for themselves last week, during the Conservative Party’s spring conference. The Government have now announced a package of interventions. These include beefing up the council’s inspection and enforcement team and investing through Homes England to create more liveable neighbourhoods.

I am truly delighted that the national Government have focused on Blackpool as an exemplar of how to level up. But the issue remains that tens of millions in housing benefit goes to these HMO landlords and, without any requirement for decent standards, there are plenty in Blackpool who will do everything in their power to avoid the expense and hassle of upgrading their properties. It is imperative that, as soon as possible, the Government bring in legislation which means that substandard landlords are not eligible for housing benefit payments, mirroring the decent homes standards that were introduced in the social housing sector in 2000.

The levelling up paper aims to reduce the number of “non-decent homes” by 50%,

“with the biggest improvements in the lowest performing areas.”

I would like to suggest an addendum: “and no non-decent homes will be funded by public funds provided through housing benefit or universal credit.”

Brexit: UK-EU Relationship

Baroness Valentine Excerpts

Thursday 1st December 2016 Lords Chamber

[Baroness Valentine (CB)]

I will limit my remarks today to the impact of our relationship with continental Europe on London’s talent mix. London is possibly the most successful and concentrated service-sector economy in the world, and given that it contributes nearly a third of the nation’s tax take, it is important that it continues to flourish.

There are roughly 1 million mainland Europeans in London, but only 19% of them would have the right to stay under existing visa rules without their EU rights. Two things worry me: first, our moral duty to these people, and secondly, the impossibility of running the economy in the absence of willing and able workers such as these. The official Vote Leave campaign proposed that there should be,

“no change for EU citizens already lawfully resident in the UK. These EU citizens will automatically be granted indefinite leave to remain in the UK”.

Polling from ICM for British Future found that 84% of the British public supports letting EU migrants stay, including three-quarters of leave voters.

I am concerned about the impact on the economy of removing European workers both now and post-Brexit. In some of London’s high-growth small businesses, particularly in technology, often one-third to one-half of staff come from all over Europe. Research from Oxford University’s Migration Observatory found that around two-thirds of European workers in the financial and professional services sector across the UK would not have the right to stay under existing visa rules.

My contention is that not only do we need to continue to welcome the global talent, including students, that supports London’s position as the most highly skilled city in the world, we also need for the foreseeable future to attract those with medium-level skills in cyclical industries such as construction, and in sectors where the majority of the labour force is currently foreign-born. Today we do not have enough people to build the houses we need, even with European workers. Furthermore, London attracts more international visitors than any other city, and global tourism is growing. However, EU citizens make up half the labour force.

In the long term, there is no doubt that we can train more locals—for example, now that we have the somewhat overdue but welcome decision on airport capacity, the noble Lord, Lord Blunkett, is leading a taskforce to develop talent from all around the country, and HS2 has its training college at Doncaster—but none of this can happen overnight. Business needs time to plan, invest and resolve challenges, and the education system needs to do better at providing people with the right skills. In the meantime we need transitional arrangements with Europe that recognise that there will be a continuing need for overseas workers with a range of skills while we seek to train sufficient willing and able people to meet our economic needs, and we urgently need to clarify the status of those continental Europeans already here.

United Kingdom and China

Baroness Valentine Excerpts

Thursday 7th November 2013 Lords Chamber

[Baroness Valentine (CB)]

Our economic relationship with China is often presented in terms of imports and exports. However, as chief executive of London First—a business membership organisation that helped to create the UK China Visa Alliance—I know that this fails to capture the extent of the connection. Many UK organisations do business with China in less obvious ways. Arup is advising on construction projects, Prospects is helping Chinese entrepreneurs to set up English language schools, universities such as UCL, as we heard earlier, are opening Far Eastern campuses so that Chinese students can benefit from our world-class education and, of course, as the Minister well knows, Hong Kong is a thriving financial centre with strong links to the UK through our historic association. London is the lead location for Chinese investment, while in Manchester the £800 million cash injection into “Airport City” by a Beijing investor will make it one of the country’s biggest construction projects since the Olympic Park.

But there remain barriers to our economic relationship, and I follow the noble Lord, Lord Dobbs, by zeroing in on the issues of tourist visas and air links. Before I do so, I add my plea to those of previous speakers for the Government to remove students from the net migration target. The UK is unlikely to become a member of Schengen any time soon. The unwelcome consequence of remaining outside is that would-be visitors to Europe can visit 26 countries on one visa but have to apply for an additional visa to include the UK on their trip. On top of that, we require them to supply fingerprints, which can mean a round trip of up to 600 miles to one of our application centres. It is small wonder that five times as many Chinese hit the shops on the Champs-Élysées as empty their wallets in the West End. The problem is not that we turn down too many applications, but that not enough potential visitors apply in the first place. The growing Chinese middle class makes up the world’s most valuable and expanding tourist market. Chinese visitors spend more than 60% of their travel budget on shopping, and last year they overtook American shoppers as the world’s biggest purchasers of luxury goods, accounting for 25% of the world market.

To give them credit, the Government are moving in the right direction. Recently they announced a pilot scheme under which some visitors will have to fill in only one form for the two visas. Next year, we expect the Schengen countries to start demanding fingerprints as well, which levels the playing field in one respect, although it is probable that this will make it even less likely that the Chinese will want to go through the hassle twice. I encourage the Government to go further by extending the shared application process to all travellers, and ultimately to collocate visa centres with those of other Schengen countries so that the entire process can be as seamless as possible for our potential high-spending visitors. While on the subject of border enforcement, I also urge the Government to look at reducing immigration queue times at airports. After a long flight, a target queue time of three-quarters of an hour is hardly a welcome.

That leads me neatly on to my next subject. Armed with a visa we need, physically, to get the Chinese to Britain. I do not need to reiterate that the UK is falling behind European competitors in its air connectivity to emerging and high-growth economies. Despite being one of the busiest hub airports in the world, Heathrow is an especially weak link to China. In fact, China is one of the destinations that globally are most frequently accessed from a hub outside the UK. On the other hand, by 2015, China will have spent four years building 82 new airports. We in the UK will be awaiting recommendations that may or may not enable us to build just one new runway in 10 years’ time. How confident is the Minister that when those 82 airports have been built, all those potential flights to the UK will have somewhere to land?

Perhaps I may end by dedicating a limerick to the Secretary of State for Transport and the Home Secretary:

A man on a flight from Shanghai

Found himself wondering why

With just one Schengen visa

He’d see Paris and Pisa

But London, he’d have to pass by.

EU: UK Isolation

Baroness Valentine Excerpts

Monday 22nd April 2013 Grand Committee

[Baroness Valentine]

My Lords, it is difficult to follow that. The question of this debate takes as its premise that UK isolation is a bad thing, but is that the case? In my role as chief executive of London First, I talk to many business people who have given serious thought to how a UK that is not part of the EU might fare. Some point to our historic success factors—an open business culture, our time zone, English law and the English language—none of which comes from Europe. They question whether our membership really makes it easier to do business in Europe than with, say, Norway. Further, they argue that our focus should be on the emerging economies. Others challenge the assumption that leaving the EU would damage London’s role as a financial centre. Supposing the EU were, in effect, to shrink to the eurozone, a new European financial centre would almost certainly emerge, but with an inward-looking focus, and meanwhile the UK would expand its global financial role.

However, it seems to me that these views merely represent pragmatic ways of dealing with a situation that few would actually welcome. Certainly, business people complain about red tape and employment law emanating from Brussels, but of those multinational companies that I speak to, not one has advocated divergent regulation within Europe. Furthermore, they understand the logic of negotiating global free trade agreements from a base of 500 million people rather than 60 million. While the need to shore up the euro necessitates reviewing relationships in Europe, I have yet to meet a senior business figure who would actively have sought a referendum at this time.

Continental Europe remains a major trading partner for the UK. We must value and respect that relationship. Let us not forget that for many companies, whether British, Asian or American owned, London is the location of their European head office. Any suggestion that the host country is at odds with other countries in the region is clearly unhelpful.

In financial services, what Europe needs is a financial centre which is competitive with the Americas and Asia. What the UK needs is friends to make that point, rather than enemies who resent the Anglo-Saxon business model. This is about tactics in Europe as much as whether one is a Europhobe or a Europhile. Some countries may wish to see London lose its position but there are also European firms and member states that value having globally competitive capital markets within our time zone. Certainly, tactically, it is not clever for the Chancellor to be voted down 26 to 1 on bankers’ pay, whatever way you look at it.

Therefore, my plea to government is not to risk vital relationships with political posturing. The only way to improve the relationship with Europe is to put two feet firmly inside the tent, identify allies and commit wholeheartedly to making the Union work for everyone’s benefit.