Oral Answers to Questions

Lord Hanson of Flint Excerpts

Tuesday 22nd May 2018 Commons Chamber

[Elizabeth Truss]

The most important thing is that those young people are in jobs, and under Labour we saw unemployment rise to 20%. Youth unemployment has reduced by 40% since 2010. I recognise that we need to see those young people get better skills. That is why we are investing in IT training, that is why we are developing the maths premium so that more students study science, technology, engineering and maths, and that is why we have developed the apprenticeship levy to get more people into apprenticeships.

[David Hanson (Delyn) (Lab)]

14. What recent estimate the Government have made of the cost to the economy of money laundering and criminal finance in the UK.

[The Economic Secretary to the Treasury (John Glen)]

The social and economic costs of organised crime, of which money laundering is a key facilitator, total tens of billions of pounds a year. The Government are committed to tackling illicit finance in the UK and have implemented recent measures including the Criminal Finances Act 2017 and the updated money laundering regulations, both of which were brought into law in the past year.

[David Hanson]

The cross-party Foreign Affairs Committee said only yesterday that the Government should show stronger political leadership in tackling the importing of dirty money into the United Kingdom. Is it not time that the Government supported the Labour Front Bench’s proposals for an overseas register of interests?

[John Glen]

I acknowledge the report of the Select Committee. This Government stand by the rule of law. We do not do random confiscations but, alongside the work being undertaken, work is under way across Whitehall to examine what further steps are necessary. I am eager that we go as far as we can, and we must do so in ways that are consistent with our values.

Banking Misconduct and the FCA

Lord Hanson of Flint Excerpts

Thursday 10th May 2018 Commons Chamber

[Martin Whitfield]

Again, that is an excellent intervention. It is almost as if planned, because I am about to turn to the question of dispute resolution.

The FCA’s recent consultation into extending the Financial Ombudsman Service clearly sets out the complex landscape of commercial disputes, but it also identifies what it can and cannot do as a regulator to bridge this gap. The all-party group is very clear that it cannot possibly support the proposed extension of the Financial Ombudsman Service as a stand-alone solution to problems that have beset the business community for so long. Even with extended powers, it will not be sufficient to cover complex cases or those that sit outside the regulatory perimeters. The FCA’s consultation makes it very clear that it has limited powers and that a complete solution must include action by the Government and this Parliament. It is not an either/or; we need both.

[David Hanson (Delyn) (Lab)]

This is not a partisan point, but one about the current and previous Governments: schemes executed by the Government, such as the enterprise finance guarantee scheme, have been misused by RBS, but RBS has been retained under some element of public ownership, if not control, so will my hon. Friend call on the Government to look at the schemes they have operated and at their performance in helping to support colleagues and constituents such as mine?

[Martin Whitfield]

Again, I am grateful for that intervention. Clearly, at the end of the day, this goes to the question of a public examination of what has happened and where things have gone wrong. RBS is obviously still held by the public through the shares we bought when we bailed it out, but even without that, there is still a responsibility to make sure that the banking and financial sectors apply rules and laws equitably, fairly and transparently, and do not seek to put down small and medium-sized businesses to their own benefit.

Leaving the EU: UK Ports (Customs)

Lord Hanson of Flint Excerpts

Monday 19th March 2018 Commons Chamber

[Mel Stride]

As I have already said, we will make sure that those elements of infrastructure—the places where goods can be checked on an intelligence-led basis and the technology that is required to keep our customs borders moving—will be in place by the appropriate time.

[David Hanson (Delyn) (Lab)]

If a Dublin-based company imports goods from mainland Europe in the European Union, puts them on a lorry, drives them through the frictionless border to Belfast, puts them on a ferry from Belfast to Liverpool, near my constituency, at what point do checks, and indeed facilitations, take place?

[Mel Stride]

As the right hon. Gentleman will know, these matters are subject to negotiation at the present time, but what we will make absolutely certain of is that there is no hard border between Northern Ireland and the Republic of Ireland, that there is no customs border effectively within the Irish sea, that the Belfast agreement is respected, and that we have a relatively frictionless movement of goods across the Northern Ireland-Irish border.

Oral Answers to Questions

Lord Hanson of Flint Excerpts

Tuesday 27th February 2018 Commons Chamber

[Elizabeth Truss]

We have announced new policies on reporting the private sector pay gap. The pay gap has come down under this Government and we are now seeing a record number of women in work, and the reason is that we have taken the difficult economic decision to close the deficit and ensured that we have allowed the private sector to flourish.

[David Hanson (Delyn) (Lab)]

17. With inflation at 3% and Government cuts to council tax and police budgets forcing up precepts, why should low-paid workers, who are predominantly women, have an increase of only 1% next year, after four years of 1% already?

Public Sector Pay

Lord Hanson of Flint Excerpts

Monday 4th December 2017 Westminster Hall

[Several hon. Members rose—]

[David Hanson (in the Chair)]

Order. Some 22 right hon. and hon. Members have indicated that they wish to speak in the debate. The debate appears to have a long time to run, as it can continue until 7.30 pm, but my successor in the Chair will have to call the Front-Bench spokespeople at around 7 pm. Given that we have two hours and, at the moment, about 22 hon. Members who wish to speak, I suggest that Members stick to five or six minutes. I may have to impose a time limit later on, but I hope that we can manage that voluntarily. I call Gerald Jones.

--- Later in debate ---

[Several hon. Members rose—]

[David Hanson (in the Chair)]

Order. A number of Members have intervened, then left the Chamber. Mr Speaker takes it very seriously if people do not have the respect to stay for the rest of the debate if they have intervened. I hope that other Members who intervene will stay in the Chamber for the whole debate. It is extremely discourteous to all Members, particularly when we have 22 people wishing to speak.

--- Later in debate ---

[Jack Dromey]

Because of the pressure of time, I will not, so that more people can speak.

The reward of those public servants is rising demand, rising workload and falling living standards. That is the impact of not only pay restraint but major cuts to, for example, local government budgets, leading in turn to problems with increments, shift changes and fewer people being employed, so those left having to do more. In our constituencies we can all see the impact on them and their families, as they have to turn to debt advice, pawning household goods, taking out payday loans and food banks, such as the home carer I met in a food bank in my constituency—a proud woman with two kids who loved her job but could not make ends meet without going to the food bank.

If public servants are suffering, so too are public services, through the turnover of labour and the stress on staff—very often, staff complements are stretched to the maximum and those who work in public services are demoralised. There is an impact on local economies, because if public servants get a pay rise, they do not salt away their money into Cayman Islands bank accounts; they spend it in the local economy, creating wealth and jobs. There is a grotesque contrast between the way that public servants are treated and what has been revealed in the paradise papers. This is a Britain where we have a Conservative Government that stand back and allow tax dodgers to get away with it, and then the Prime Minister says during the general election campaign to a nurse that there is no such thing as a magic money tree. Yes, there is, and they grow on the Cayman Islands, Bermuda and Jersey, helping the wealthy to avoid their responsibility to society.

I am grieved because I am from a family of public servants: when my dad came off the roads he was a train driver on the London underground; my mum was a nurse; my Uncle Mick, who lived with us, was a street cleaner. They believed in public services, as the country believes now in public services and public servants, but public servants have been let down by a failing, uncaring Government. It is interesting that a monastic vow of silence has been taken by those opposite, who have been reluctant to get up and defend what their Government are doing. The unmistakable message from this debate is that they may stay quiet but we will not. Labour is on the side of public servants.

[David Hanson (in the Chair)]

A number of hon. Members have withdrawn from speaking, giving us a little more flexibility. Rather than a strict five-minute limit, hon. Members may speak for six or seven minutes.

--- Later in debate ---

[Mrs Gillan]

On a point of order, Mr Hanson. I need your advice. I was not able to put in to speak in this debate because I am not able to be here for the whole debate, but this matter was raised with me by two constituents and I came here to listen because I hoped that I would be educated. I have sat here and heard the Government being castigated. I wanted to intervene, and I was trying not to counteract your advice that we should not just intervene and leave the Chamber, but unfortunately the hon. Gentleman would not let me intervene. How do you think I can best make my point, other than through this point of order?

[David Hanson (in the Chair)]

I am grateful to the right hon. Lady for what was, in many ways, a non-point of order. She will know that the hon. Gentleman who has the floor is entitled to decide whether to give way. He has chosen not to give way. I did say that Members should not intervene and then leave, because I was concerned that some Members intervened and then walked straight out. If she wishes to intervene and a Member wishes to accept her intervention, that is fine. In order to progress the matter—we do have some extra time now because of Members withdrawing—Mr Yasin can continue.

[Mohammad Yasin]

Thank you, Mr Hanson. I have not finished yet. I am grateful for the patience of the right hon. Member for Chesham and Amersham (Mrs Gillan) and I am glad that a Government Member wants to speak, so I will take this opportunity to give her a chance to do so.

[Mohammad Yasin]

You should ask your Minister how he will deal with these issues. If you care for the people, you should not ignore the workers, and you should not ignore the nurses—

[David Hanson (in the Chair)]

Order. “You” is me.

[Mohammad Yasin]

I apologise. If the Government care for public sector workers, they should not ignore teachers and they should not ignore nurses. They should not ignore the 5.5 million workers in this country, and their families, who are struggling because of the cuts that the Government have made.

It is painful that only a handful of Government Members have turned up for this important debate. That shows that they do not care about our workers, who provide such a wonderful service to our country. As my hon. Friend the Member for North West Durham (Laura Pidcock) said, if those workers stopped work today, the country would collapse. The Government need to take care of these workers and listen to them, and they should stop cutting their livelihood.

Paradise Papers

Lord Hanson of Flint Excerpts

Monday 6th November 2017 Commons Chamber

[Mel Stride]

As the hon. Gentleman will know, those are not figures that I have at my fingertips. As he will also know, confidential arrangements are rightly in place in many of the structures to which he refers; indeed, he, and perhaps even the headquarters of his party, might even be held within one of those arrangements. Of necessity, that particular information is not fully available.

[David Hanson (Delyn) (Lab)]

Will the Minister clarify his understanding of the position in respect of non-doms donating to political parties in the UK? In the interests of transparency, will he arrange for all parties to publish lists of non-doms who have donated to their parties?

[Mel Stride]

As the right hon. Gentleman will know, there are requirements relating to transparency and donations to political parties, and the Government have put an end to permanent non-dom status.

Oral Answers to Questions

Lord Hanson of Flint Excerpts

Tuesday 24th October 2017 Commons Chamber

[Elizabeth Truss]

That is one of the reasons why we need to make sure that we are reducing our debt and reducing our deficit in order to reduce the interest payments that came as a result of the previous Labour Government leaving us with the highest deficit in history. We have an independent Bank of England, and it is very important that as a Government Minister I do not tell it what to do on interest rates.

[David Hanson (Delyn) (Lab)]

8. What recent assessment his Department has made of trends in the level of public sector pay since 2010.

[The Chief Secretary to the Treasury (Elizabeth Truss)]

In 2010, there was a significant gap between wages in the public and private sectors whereby public sector workers received an average of 5.76% higher pay. Today, wages are comparable, and when we take into account more generous pension benefits, there is an additional 10% pension premium in the public sector.

[David Hanson]

Last week, the rate of inflation was announced at 3%. Public sector pay rises are at 1%. Will the Chief Secretary confirm that that is a pay cut for millions of workers, and will she take this from me as a Budget representation: “Scrap the cap”?

[Elizabeth Truss]

It seems that the right hon. Gentleman cannot take yes for an answer. There is not a public sector pay cap. We have said that individual Secretaries of State will be responsible for making proposals on their workforces dependent on specific circumstances. We are facing very different issues in the NHS and in the armed forces. What is important is that we look at the evidence and make sure that we can recruit and retain the best possible workers in the public sector, but we also need to make sure that we do not price out of the market people working in the private sector.

Public Sector Pay Cap

Lord Hanson of Flint Excerpts

Wednesday 5th July 2017 Commons Chamber

[Elizabeth Truss]

I completely agree with my hon. Friend that doctors and other medical staff do a vital job and have faced real challenges. We are reducing the agency spend in the NHS over time. It is important that we look overall at the affordability for the public sector. That is the remit of the independent pay review bodies. They hear evidence from the experts on the frontline and make their recommendations. We accepted the recommendation for doctors that was put to us. We accepted the recommendation for nurses and other NHS workers as well. We respect that pay review body process.

[David Hanson (Delyn) (Lab)]

Put simply, does the Chief Secretary think it fair that the public sector workers who face a cap also face a rise of around 5% to 7% in energy prices when the chief executive of SSE this year had a 72% increase in his pay, taking it to £2.9 million?

[Elizabeth Truss]

The Government are taking action on energy costs. We are also making sure that public sector workers receive increments in addition to the 1% that the right hon. Gentleman mentioned. We are taking action as a Government to raise the tax threshold, so that people on the basic rate are now paying £1,000 less tax. He needs to take account of the whole package; I think that he is cherry-picking some bits.

Class 4 National Insurance Contributions

Lord Hanson of Flint Excerpts

Wednesday 15th March 2017 Commons Chamber

[Mr Hammond]

Yes. First we will respond to Matthew Taylor’s report, which looks more widely at employment rights in a rapidly changing economy. We will look at parental benefits, which are the principal area where there is still a discrepancy in what is available for the self-employed and the employed. There are other relatively minor areas, but we will look at all of them and seek to, as it were, audit the differences in treatment between the employed and self-employed. The House and people outside will then be able to see in the round the difference in access to benefits and entitlements and the difference in contributions, and form a judgment about how we should move forward.

[Mr David Hanson (Delyn) (Lab)]

Just so that I do not have to wait 30 years to read the minutes of the Cabinet meeting, will the Chancellor confirm that the decision last week was the unanimous decision of the Cabinet? As he is seeking savings to fill the £2 billion hole, will he start with the £320 million towards free schools that he announced last week?

[Mr Hammond]

I am sorry to disappoint the right hon. Gentleman, but he will have to wait 30 years. I am not about to tell him what happened in the Cabinet, but he will know that all decisions are the unanimous decisions of the Cabinet.

Commercial Financial Dispute Resolution Platform

Lord Hanson of Flint Excerpts

Thursday 15th December 2016 Commons Chamber

[Mr David Hanson (Delyn) (Lab)]

It is a pleasure to follow the hon. Member for Henley (John Howell), a fellow member of the Justice Committee and chair of the all-party group on alternative dispute resolution, of which I am a member. I welcome his contribution, and the motion in the name of the hon. Member for East Lothian (George Kerevan), to which I was pleased to add my name, as a Labour MP; I support its objectives on a cross-party basis.

The issue is of great importance, and the Minister has a duty to the House to respond in a positive way to the very straightforward demand made by Members today—a demand that we establish a universal mechanism that allows businesses and others in non-regulated sectors an appeals mechanism, so that they can have an independent review of their situation. The motion is important, and I support it. The demands are clear, and have not come out of the blue. The motion clearly refers to the statement made by Andrew Bailey of the Financial Conduct Authority to the Treasury Committee on 20 July 2016. He said that we needed to look at the fact that

“the ad hoc creation of a compensation scheme within the FCA”

had not worked, and that there was no mechanism in place for many businesses—Members will no doubt mention them today—to find a resolution. Remember, these are small businesses facing big banks that have the time, money, expertise and often patience to try to see out the complaints being made. The motion, which calls for an effective, sustainable platform for resolving commercial financial disputes, is therefore absolutely right and timely.

Although many financial firms may be regulated, business and commercial banking remains an unregulated activity in the UK. Businesses do not have the same level of protection as consumers; they have to rely on internal complaints procedures and on the Financial Ombudsman Service, which may not be well equipped to deal with some of these cases. Businesses have to consider the potential for expensive, protracted activity through the courts. All of this effectively militates against fairness when opportunities have been denied or wrongs done.

I am particularly concerned about the Royal Bank of Scotland, which remains in public ownership. We taxpayers still endorse and act on behalf of the bank. The Minister has to look at not just the complaints procedure proposed by the hon. Member for East Lothian on behalf of the all-party group on fair business banking, but the Government’s responsibility, on behalf of every taxpayer, for the services provided by, and the attitudes and responses of, a bank that remains owned by me, my hon. Friend the Member for Bootle (Peter Dowd) on the Front Bench and every Member of this House.

This matters because over 12,000 companies were pushed into RBS’s controversial turnaround division, called the Global Restructuring Group. We are talking about real pressures and real actions affecting real businesses, and the bank having acted unfairly. Indeed, it has now recognised that it acted unfairly and has provided a compensation scheme of its own, but there is no independent scrutiny of it, and not necessarily any independent endorsement of it yet, because as the hon. Member for East Lothian said, this has not yet been finalised. RBS has a major commitment to those 12,000 businesses.

This also matters because of cases such as that of my constituent Clive May of Mold in Flintshire, north Wales. With his permission, I will detail his case. He experienced at first hand the actions of RBS in relation to the Government-sponsored enterprise finance guarantee scheme. Mr May was the owner of a successful business employing 100 people in north Wales. It was a construction company, building houses and factories. The company had banked with RBS for many years when Mr May was approached by RBS and asked to take up the EFG scheme, which was designed by the Labour Government to support the growth—not the closing down—of businesses through the difficult times of the recession between 2008 and 2010.

Mr May believed that the enterprise finance guarantee scheme would support the expansion of his business. He was informed that his overdraft, for which he had always met his responsibilities, and which was not excessive, as he could meet the liabilities, was to be taken over by the EFG scheme, and that his business’s cash flow would therefore be protected and developed. That was a falsehood on the part of RBS, because the moment he took up the EFG scheme, RBS placed the company in its distressed department and cut his overdraft.

[Norman Lamb]

It has been a pleasure to work with the right hon. Gentleman on what I regard as a scandal. Surely he is making the incredibly serious allegation that not only was an individual destroyed, but there was misuse of public money.

[Mr Hanson]

Absolutely, and I make that allegation here today. RBS has acted appallingly in its treatment of my constituent. Before Mr May took up the EFG, his business was making new contracts, had excellent cash flow, and never once went over its agreed overdraft limit. The moment Mr May took part in the EFG scheme, RBS took from the Government the money underpinning that overdraft, closed down his overdraft and ruined his business. That is important because Mr May exemplifies the small business facing the big bank. He and his wife Kerry have spent four years arguing this case—along with me as their Member of Parliament—having meetings with RBS, and looking at court cases, and now at criminal activity, which has been reported to North Wales police, because there are allegations of fraud. That is also being looked at by the Crown Prosecution Service, which is reviewing the case. All of that is because of concerns about how RBS has acted, but there is no mechanism to drag this case forward apart from Mr May’s personal determination and will to hold RBS to account. The Financial Services Authority cannot do that; he has to have the will himself, with the support of his family and his MP. That is not acceptable.

That is why I support the proposal of the hon. Member for East Lothian. Mr May’s business and similar businesses need this mechanism to ensure that they get fairness when they face banks such as RBS, which is in public ownership, that treat them with disdain.

--- Later in debate ---

[The Economic Secretary to the Treasury (Simon Kirby)]

I thank the hon. Member for East Lothian (George Kerevan) for securing this debate and, to be fair, for his very thoughtful and measured speech. We certainly acknowledge the importance of the issues that have been raised today.

As a former businessman, I have a great deal of sympathy with all the businesses that have been mentioned and, indeed, all the other businesses that have been treated unfairly. As has been clearly shown by the speeches today, we all care about the businesses that form the backbone of our economy. We should never forget that businesses are more than just numbers; they are people, families, employees, customers and local communities.

This Government have a very strong record of supporting large and small companies, including through our competitive tax regime and our investment in skills, research and infrastructure. Clearly, one way that businesses are able to grow and develop is through having access to finance, so we all want financial services providers to lend to our businesses and to act in the strictest accordance with the FCA’s rules. Wherever that is not the case, any affected business should be compensated appropriately.

We have already heard about the avenues that exist for SMEs in dealing with their banks—from the Financial Ombudsman Service to the FCA’s powers to require firms to establish redress schemes—but it is right to look at the interactions of small businesses with financial services providers to ensure that their dealings are fair and effective. The FCA is already doing that. It launched a discussion paper on SMEs as users of financial services in November 2015. Among other things, that looks at the remit of the FOS in providing fast and inexpensive redress for consumers and our smallest businesses. The FCA is currently analysing the responses to the discussion paper, but when its findings are published, we will consider them very closely. Let me make it clear that if they include the need to review the support for businesses in resolving financial disputes, we will look at that.

It is important for me to reflect on the specific comments made today. There have been quite a few, but I shall do my very best to cover most of them. The hon. Member for East Lothian asked about reforming insolvency law. He may be pleased to hear that the Government keep insolvency law under regular review, and we are currently considering the responses to our recent review of the corporate insolvency framework.

The hon. Gentleman mentioned Andrew Bailey. As Andrew Bailey made clear in his letter to the hon. Gentleman yesterday, the FCA is considering the treatment of small and medium-sized enterprises as users of financial services. It has yet to publish the findings from that work, but, again, if they include the need to review the support for businesses in resolving financial disputes, we will look at that.

I fully recognise the hon. Gentleman’s views about RBS, the Global Restructuring Group and its treatment of small business. I share those concerns and am keen to discuss with RBS the detail of the redress scheme it announced recently for former customers of GRG.

I thank my hon. Friend the Member for Henley (John Howell) for his support for alternative dispute resolution. We welcome businesses using alternative methods to resolve disputes.

The right hon. Member for Delyn (Mr Hanson) raised concerns about the quality of the IRHP review. The Treasury Committee has recommended that the FCA should learn lessons and the FCA has confirmed that it will do so once legal proceedings are at an end. He also mentioned access to the Financial Ombudsman Service. The FCA estimates that 97% of small businesses have access to the FOS and the Government believe the FOS plays a crucial role for small businesses.

The right hon. Gentleman asked an important question about the British Business Bank’s enterprise finance guarantee scheme. At the instigation of the British Business Bank, RBS conducted an in-depth internal investigation of its administration of the EFG. RBS put in place a plan to rectify the issues identified and has concluded remediation action with affected customers.

[Mr Hanson]

Will the Minister give way?

[Simon Kirby]

I will not give way, but perhaps we might speak afterwards. I have an awful lot of things I have to address.

My hon. Friend the Member for Wycombe (Mr Baker) asked about incentives to discourage misconduct. The Government and regulators have acted to embed personal responsibility in banking through the senior managers and certification regime. He also stated that small businesses should be treated as consumers.