Northern Ireland Protocol Bill

Debate between Earl of Kinnoull and Lord Deben

Committee stage
Wednesday 2nd November 2022 Lords Chamber

[Lord Deben (Con)]

My Lords, in declaring an interest as chairman of the Climate Change Committee, I wish to follow on from what has just been said. As the Democratic Unionist Party knows, we have reached out to Northern Ireland particularly because of the difficulties the economics of that part of the United Kingdom have in meeting the climate change requirements. Indeed, I found myself in what my noble friends might well feel are the unusual circumstances of defending the Northern Irish Government against an assault by Sinn Féin and the Greens, demanding answers in Northern Ireland that were, in our view, not possible. The Climate Change Committee is clear that we do not ask of people things they cannot do. Therefore, Northern Ireland has a much more limited demand on it: to reach something like 85% of the 100% we want for net zero in 2050. That means that the rest of the United Kingdom must do better to make this possible.

I beg my noble friends the Ministers to recognise that, although they know that I am deeply opposed to this Bill in every aspect, I am asking for their help on this because the Bill presents a peculiar and particular difficulty: the single electricity market in Ireland is crucial to trying to meet the requirements that we place before it. First of all, it is crucial to keep the lights on Northern Ireland—I ask noble Lords to forget climate change for a moment because this is absolutely vital, and this is why it is set up in this way. I know this because I had to understand it to do the work that we did to help the DUP present its case to the Northern Ireland Assembly for not doing what most of us would love the Assembly to do: to reach the net-zero target that we have as a United Kingdom by 2050.

I beg the Minister to take this very seriously indeed, and to think of it differently from the way he wishes to think about the rest of the Bill. There will be issues if we interfere with the single electricity market; I cannot even see how we keep the lights on now. We must make enormous changes to meet the net-zero target, which the Prime Minister reaffirmed today as essential for our economic future as a United Kingdom. So if we are talking about the protection of the United Kingdom —the union—this is crucial to get right. This is not just about keeping the lights on; it is about ensuring that we can go on keeping the lights on without costing the earth. That is going to be very difficult for Northern Ireland to do—I recognise that. We have had extremely good conversations about how we might do it, but we will not be able to do it if we throw this bit of co-operation into debate or dispute, because Ireland as a whole—as an island—must meet this target together.

Indeed, one of the arguments properly put by the DUP when we were discussing all this was that the Republic of Ireland has not explained how it is going to meet its targets—we accepted that. We said that this does not excuse us from being detailed about meeting our targets. Instead, it means that we must recognise that those targets are not going to be met on a north of Ireland basis; they will have to be met by Northern Ireland within the context of the whole of Ireland meeting them.

The detailed examination of this, as put forward by the noble Lord, Lord Hain, is crucial in debating the Bill. In a sense, I wish that I liked the Bill, because that would enable my noble friend the Minister to see that I am being specific about this issue, wholly separately from the fact that I think the Bill gives the Government powers they should never have. The noble and learned Lord, Lord Judge, again pointed out that, every time we discuss any of these things, the big problem is that we are uncertain as to how these powers would be used. The problem here is not that, but rather, without excluding the single electricity market, we explicitly say that neither the European Court of Justice nor its previous decisions can be used in these circumstances. There is no way that the single electricity market can be run unless we maintain and protect the mechanisms which have in fact proven perfectly reasonable ever since they were put in place. Consequently, unless we maintain those mechanisms, there is no way we can keep the lights on because there is no way we can make that mechanism work.

Similarly, to those of us who are passionate about the serious issue we have so short a time to fight—climate change, the biggest physical threat to our society—I say that we are now throwing into doubt, maybe for years, the mechanisms without which we cannot do that job in Northern Ireland or Ireland as a whole. I plead with my noble friend the Minister to forget all the other arguments and recognise that there is something here that the Government must change in passing this Bill, whatever else happens. The Government know perfectly well that I hope the Bill will not pass and that I will do anything in my power to stop it passing, because it is a very bad Bill. However, this is so disruptive that it must be looked at, even by those who believe in the Bill.

If the Government want the co-operation they are hoping to get through this Bill, I hope the Democratic Unionist Party will explain to them why they must protect the electricity supplies. There is no way of doing that—or of ensuring that we fight climate change in Ireland—unless we accept that the electricity system be excluded from the operations of this Bill.

[The Earl of Kinnoull (CB)]

My Lords, I continue to be worried by the interrelationship between the trade and co-operation agreement and the withdrawal agreement. I mentioned this before in Committee on Monday, but I did not develop the point at all. The trade and co-operation agreement is 1,246 pages long. If you get to Part 7, “Final Provisions”, on page 402, you find a provision called “Relationship with other agreements”. I will just read it out because I think it is critical; we have been talking about Rumsfeld problems, but I think this is a kryptonite problem. It says:

“This Agreement and any supplementing agreement apply without prejudice to any earlier bilateral agreement between the United Kingdom of the one part and the Union and the European Atomic Energy Community of the other part. The Parties reaffirm their obligations to implement any such Agreement.”


This provision has been the topic of quite a debate around the place in articles, conferences and things, but it is an interlinking provision between the critical trade and co-operation agreement and the withdrawal agreement. As an interlinking provision, it means that, if something happens to the withdrawal agreement, that in turn—so goes the argument—could come back and torpedo part of, in some way, the trade and co-operation agreement, which, as I have said, is such a critical piece of our trade with our largest trading partner.

I feel that it is very important to consider that. First, I would like to ask the Minister—I am not sure who is answering this section; I now know it is the noble Lord, Lord Ahmad—whether he accepts that this an extremely important thing to consider. If by doing something to the Northern Ireland protocol and the withdrawal agreement you are causing damage to the trade and co-operation agreement, that could be very serious. Certainly, as you sought to make a change to the protocol, you would need to come back to a parliamentary process. You would need to stop and think very carefully about what would happen. That is why, when I look at Clause 13(4), naturally I agree with everything that the noble and learned Lord the Convenor said earlier about this, but I have an additional worry that any old Minister of the Crown could rush into making some regulations and not remember page 402 of the trade and co-operation agreement.

Financial Guidance and Claims Bill [HL]

Debate between Earl of Kinnoull and Lord Deben

Report: 2nd sitting (Hansard): House of Lords
Tuesday 31st October 2017 Lords Chamber

[The Earl of Kinnoull (CB)]

My Lords, my name has also been added to this amendment, and I agree with every word the noble Lord, Lord Sharkey, and the noble Baroness, Lady Altmann, said. I declare my interests as set out in the register of the House, in particular those which relate to the insurance industry.

It has long been the case that for homes and mortgages considerable protections exist for consumers to prevent them from doing something in a hot-headed fashion. Indeed, this House has helped to shape those protections over many years—I remember studying the Law of Property Act 1922 at Bar school. Those protections have continued to build and generally are considered to work.

The pension asset has in recent times become just as significant. I say that off the back of an Office for National Statistics report, which it produced in December 2015, one chapter of which is called “Private Pension Wealth, Wealth in Great Britain, 2012 to 2014”. It reports that 59% of our fellow citizens now have a private pension and that the median value of the pension pots at June 2014 was £57,000. Obviously, those pots are growing through time. The median value for people between the age of 55 and 64—to the unscrupulous, the target people—was £145,000. To put that in perspective, the last house price index in this country—in June—listed the average value of a house at £220,000 or so, and Savills has helpfully estimated that the average loan-to-value ratio is about 48%. I do not want to prove anything in particular with that spray of statistics, but I want to demonstrate that the pension asset is now as valuable to our fellow citizens as the house asset across the board. Accordingly, in my mind and in logic, it too should enjoy similar protections to try to stop bad things happening.

The problem has been coming up on us and has been exacerbated by two things in recent times: first, the Osborne pension reforms; and, secondly, the very rapid rate of growth of pensions in general. To give my last statistic, the same ONS report said that in the two years to June 2014 private pension pots had grown by a median of 22%. My concern is not the big pot holder—I think that there will be sophisticated people who can look after themselves—but the large number of small pot holders who, to the unscrupulous, must look like very tempting targets.

The amendment serves to protect particularly the vulnerable and it goes some way towards making the pension asset safer, just as the legislation I referred to earlier has done for homes and mortgages. Pension asset security would be improved, without great effort on the part of government or, indeed, cost for someone who is trying legitimately to access or restructure their pension arrangements. Accordingly, I feel that this is a very sensible amendment and I very much hope to hear shortly from the Minister that the Government can do something in this area.

[Lord Deben (Con)]

My Lords, I refer the House to my declaration of interests, particularly as chairman of the Personal Investment Management & Financial Advice Association.

It is very important to take this amendment seriously because of the reforms brought in by George Osborne. There are two halves to giving people freedom: one is giving the freedom and the other is making sure that they have access to the best information in order to make the best choices. I fear that sometimes people find the first easier than the second.

I sat for some time as the representative of financial advisers on a committee of the then regulator looking into the financial understanding of people throughout the country. It was a very salutary experience, not least because many of the leaders of the providers were totally unable to explain what they were providing in language that I—being somewhat of a professional—could understand, let alone anyone else. My concern is that this is an industry that, even with the very best of intentions, is not very good at explaining the details. There are two reasons for that: one is that a special language is spoken by the experts and the second is that these things are very complicated. That is why, in many companies, people who are perfectly capable of being chairman or chief executive soon find somebody else to look after the pensions. It is a very complicated matter.

My concern is that the Bill needs constantly to look at the moments when people are most able and willing to receive advice. If that is also the point at which they most need the advice, it becomes particularly valuable. My noble friend might take note of one of the biggest changes to have happened in a quite different area. We were busy trying to get people to understand how important energy efficiency was. Many of the steps that we took seemed to have very little effect until we started to tell people, when they bought a new appliance under the European Union scheme, how energy efficient the appliance was. From one year to the next, we got rid of most of the GH levels and arrived at a situation where we were talking about A, A+ and A++. This was because we chose the moment when it was best to advise people. That is precisely what the amendment means. Not having it is not having the other half of the reforms.

Financial Guidance and Claims Bill [HL]

Debate between Earl of Kinnoull and Lord Deben

Committee: 3rd sitting (Hansard): House of Lords
Monday 11th September 2017 Lords Chamber

[Lord Deben (Con)]

My Lords, I point the House to my declaration of interests. I want to underline something that the noble Lord has just said about the danger of having conflicting areas of advice.

I am sure that my noble friend will be able to explain this, but it is already true in the financial services industry, and elsewhere, that often there are serious conflicts between the decisions being handed down, for example by the Financial Services Authority, the way that such decisions are interpreted by the ombudsman and the way that things come together. That is now a major incubus on the best companies in the field; therefore it is crucial for us to know in advance that what is being done here will not be yet another different series of things that people have to bring together. That is not to defend anybody who is doing wrong or to excuse people who have not bothered, but merely to say that the better the firm, the more important it is for it to be clear what governance it should be concerned with, what guidance means, and ensure that the opportunities for contradictions are eliminated before we start.

[The Earl of Kinnoull (CB)]

My Lords, I rise briefly to speak to Amendment 56, which is in my name. I note that the clause on setting standards, which is only 11 lines long, has eight amendments. That underlines its importance.

The origins of Amendment 56 are my concerns with the behaviour of the Financial Conduct Authority; I have been regulated by it and its predecessors for the whole of my commercial career. I realise that the single financial guidance body will only be a client organisation of it, but I am concerned about FCA ethos leaking down to the SFGB.

Perhaps I should explain further. When a regulated client rings up the FCA with a specific question, asking for help in the interpretation of its rules, the FCA, in my direct experience, simply says, “We can’t give you any help in interpreting those rules”. That is quite unlike regulators in other jurisdictions in other places—I originally wrote down “competitor regulators”. That is very unhelpful, but while it is unhelpful in the financial services world, firms are usually big enough to afford advice from big firms of solicitors. Here we are often dealing with very small charities that do not have access to £1,000 per hour for Allen & Overy, so it is important that the SFGB offers that advice.

It has been said to me that there is a big problem concerning resourcing. I think that that is quite a difficult position to maintain. First, other similar regulators in other jurisdictions do not perceive those resourcing problems. In fact, most of the questions that come up, such as on a drafting issue, do so repeatedly and the same question will be asked by many of those being regulated. Secondly, just thinking about one particular bit of FCA regulation because I know about it—the regulation of insurance brokers—the FCA and those that are being regulated bear the cost of that regulation, which is more than twice as expensive as Ireland, Bermuda and Hong Kong. That multiple is far bigger than for France and Germany. I do not therefore think that good regulation has to be expensive.

The amendment is aimed at trying to ensure that that sort of behaviour is not replicated and that the SFGB remains friendly and helpful in interpreting the regulations that it will impose on those that it regulates.