Reporting on Payment Practices and Performance (Amendment) (No. 2) Regulations 2024

Lord Aberdare Excerpts

Monday 13th January 2025 Grand Committee

[Lord Aberdare (CB)]

My Lords, I am delighted that this second set of amendments to these important reporting requirements—I am trying to prevent my teeth from chattering in the cold—focuses on the damaging issue of cash retentions in the construction sector, which was not covered by the first set of amendments that we debated on 26 February last year. Could the Minister, whom I welcome to her post, confirm that that first set of amendments has now come into effect from 1 January this year? I am delighted that the new amendments will take effect from St David’s Day, 1 March. I also welcome the fact that the reporting will take place via an online service so that the information will be available to suppliers on the website as soon as business is publishing.

As we have heard from the Minister, resolving issues such as late payment and cash retentions is vital for smaller construction firms, particularly as the Government are seeking to build 150,000 homes a year while insolvencies among construction businesses continue to be higher than in most or all other sectors. The failure of major players such as ISG can have a devastating impact on small businesses in their supply chains.

The Government’s commitment to support SMEs, including through the reporting measures such as those that we are considering today, as well as the new Fair Payment Code and the promise of a small business strategy to be published this year, is much needed and very welcome. The regulations will provide transparent data about the practice of retentions and the level of late payment for this aspect of construction contracts. Having consistent comparative data concerning retentions will represent significant progress towards increasing the accountability of larger construction companies that subcontract work to smaller firms in the sector. Those subcontractors will be able to gain an understanding of the payment practices of larger companies to help them decide whether or not to do business with them.

I will not comment on the detail of the requirements which the Minister has outlined but I welcome the requirement for a named director to confirm approval of the figures reported, so that it is clear where the responsibility lies. However, that raises the question of the enforcement of these regulations. Will the Minister say something about how robust the data provided will be, given that the requirement is for self-reporting, and whether there will be any process for fact checking the data reported? What mechanisms might be put in place to ensure that the reporting requirements are met and what penalties might there be for not reporting as required or misreporting? Most importantly, can she say anything about what plans there may be in her department to end the damage caused by retentions altogether, either by banning them outright or by ensuring that funds withheld are ring-fenced in a way that protects small firms from never receiving the sums owed to them at all—or receiving a reduced amount or late amounts?

These regulations are a welcome step forward but I hope to hear more from the Minister about what further steps the Government will take to tackle the obstacles preventing small construction firms from contributing as fully as they could and should to the Government’s construction and house-building goals, and especially whether, how and when they might finally take action to bring to an end the pernicious practice of retentions.

[Baroness Neville-Rolfe (Con)]

My Lords, I rise to speak from the Back Benches and welcome the Minister to her seat. I was also once a Business Minister and, in my second coming, a Cabinet Office Minister, and I was very much involved in trying to get rid of the curse of late payment. That included the changes to the Procurement Act requiring public sector suppliers to pay their own suppliers on time. That was meant to complement the timely payment by government procurers, which was one of the few positive legacies of Covid. The Government are pretty good at paying on time, although you have to keep departments up to scratch. I am disappointed only that the Government chose to delay the implementation of the Procurement Act and to downplay in the draft guidance note the role of small business, which noble Lords will know that I championed from the Back Benches and later when, surprisingly, I returned to the Front Bench as a Minister.

I rise today to support the noble Lord, Lord Aberdare, on cash retentions—an issue that he has campaigned on for many years. I associate myself with his good questions on transparency, enforcement and, perhaps more importantly, the Government’s intentions on the broader issue of cash retentions. That has been an abiding problem in the sector for many years. I remember that I promised a review, but I left government too soon to be able to carry through the consequentials. I hope the Minister will take his comments seriously.

School Fees: VAT

Lord Aberdare Excerpts

Thursday 10th October 2024 Lords Chamber

[Lord Livermore (Lab)]

I do not accept that in any way, shape or form. The whole point is that you should have access to high-quality education whether or not you have the money in the first place.

[Lord Aberdare (CB)]

My Lords, further to the question from my noble friend Lady Bull, the Government’s dance and drama award scheme enables a small number of specialist providers to offer higher-level qualifications, at levels 5 and 6, to some of the country’s most talented performing arts students, many of whom might otherwise be unable to access such training. What reassurance can the Minister give that these providers will not be affected by the proposed VAT imposition, which might force some of them to swithdraw completely from the scheme? What progress has been made in the discussions on this issue, including with the Treasury, mentioned by the noble Baroness, Lady Smith of Malvern, in the debate on 5 September?

[Lord Livermore (Lab)]

As I said earlier, we will monitor closely any impact of these policies on the scheme mentioned by the noble Lord. The right time to consider changes to the scheme is at the forthcoming spending review.

Self-employment: A1 Forms

Lord Aberdare Excerpts

Monday 12th February 2024 Lords Chamber

[Baroness Vere of Norbiton (Con)]

I know that obviously the DCMS and colleagues across government are working very closely with the EU and indeed with individual member states to support musicians, and 23 out of 27 member states have clarified their arrangements or introduced easements to allow visa or work-permit-free routes for short-term touring. France, Germany and the Netherlands have all stepped up early on in the process, and Spain recently changed its requirements after intervention from His Majesty’s Government. Obviously, we will continue to address challenges where we see them.

[Lord Aberdare (CB)]

My Lords, 20% of orchestras’ earned income comes from touring, mostly to countries in the European Economic Area. The Government’s plan to remove orchestra tax relief completely from performances in the EEA will have a hugely damaging effect on the viability of such touring, making it hard and, for some orchestras, even impossible to continue to tour in Europe. Will the Minister and her colleagues look again at this proposal and, if it cannot be scrapped, what support might the Government offer to orchestras to help offset the income they will lose and to enable them to continue to tour in Europe?

[Baroness Vere of Norbiton (Con)]

It is not entirely right that costs incurred in the EEA should be offset against UK tax; that would seem slightly odd. However, I reassure the noble Lord that of course some of the costs will be tax deductible: for example, if a group were to hire a conductor from the US and use that conductor for performances in the UK. Obviously, we have to make choices in this area. We are content with where we are headed in terms of removing EEA activity from the orchestra tax.

Queen’s Speech

Lord Aberdare Excerpts

Thursday 4th June 2015 Lords Chamber

[Lord Aberdare (CB)]

My Lords, I shall speak about two topics that were less prominent in the gracious Speech than I hope they will be in the Government’s overall programme for business and the economy: namely, apprenticeships and digital skills. Both are vital to tackling the challenge of improving UK competitiveness and productivity, which was so rightly emphasised by the noble Lord, Lord O’Neill, in his fine speech and by several other noble Lords.

I welcome the Government’s target of 3 million new apprenticeships and the commitment, via the full employment and welfare benefits Bill, to report annually on progress towards its achievement. However, I have some questions about how it can be achieved and how the Government will ensure that quantity is matched by increased quality. Reaching the 3 million target will require significant growth in the number of apprenticeships on offer, particularly from small and medium-sized enterprises. Many SMEs, and, indeed, larger employers, have been distinctly wary about offering apprenticeships. They worry about the costs involved, the bureaucratic and management burdens, and their ability to provide continuing work for an apprentice over the length of time involved.

A real effort is needed to persuade more firms, especially SMEs, to offer apprenticeships. Possible initiatives might include a sustained, high-profile marketing campaign to sell the benefits of apprenticeships, including powerful case studies; an enhanced system of incentives, including for approved independent bodies helping to broker apprenticeships, such as chambers of commerce or local enterprise partnerships; and specific support and encouragement for mechanisms designed to make apprenticeships easier for small employers, such as employer-led apprenticeship training agencies which undertake the tasks of recruiting and managing apprentices on behalf of a consortium of small employers, either on a geographic or a sectoral basis.

Apprenticeships need also to be of high quality. We need more higher-level, longer-term apprenticeships, as the Government have recognised, and, above all, apprenticeships need to lead on to actual, sustainable jobs. Like the noble Lord, Lord German, I find it startling that there seem to be no clearly defined ladders of progression through the various levels of training: for example, from traineeships on to apprenticeships and then into full-time jobs. Surely there should be some sort of account management for young people entering work experience, so that on completion of each stage they receive guidance on possible progression routes that they might follow at the next stage. This links to the need for a much better system of careers advice and guidance than currently exists. I hope that the plan included in the same Bill to provide Jobcentre Plus adviser support in schools across England will help address this.

Another concern is the challenge of proliferating apprenticeship standards. According to the Federation for Industry Sector Skills & Standards, which is the single certifying authority for all apprenticeships in England, there are currently 200 standards under development by 96 so-called trailblazer groups. It is estimated that ultimately some 1,500 standards may be needed, with at least 150 development groups. We need clearly defined processes for managing this complexity and avoiding unnecessary duplication, and for maintaining all the standards after their development groups have disbanded. I therefore hope that the Minister will be able to tell us something about how the Government plan to persuade more employers, especially SMEs, to offer apprenticeships and to ensure that the overall quality and sustainability of apprenticeships is raised.

Digital skills are equally important to productivity and competitiveness. I had the privilege last year of serving on your Lordships’ Select Committee on Digital Skills, along with the noble Lord, Lord Haskel, who has already spoken, and the noble Lord, Lord Macdonald of Tradeston, who is about to speak. The committee published its report in February with recommendations specifically aimed at this new Government. The copious evidence we received made it absolutely plain that the need for digital skills is not confined to what might be called technical sectors, let alone the information technology sector itself, nor only to people wishing to become technologists.

Digital skills are universally required by every sector—from robotics to fashion design—by every worker and increasingly by every citizen. The Tech Partnership, recognised by government as the industrial partnership for the digital industries—and so a key player in meeting the digital skills challenge—now comprises more than 500 employers from every industry sector across the UK economy. There are huge and growing opportunities in the digital economy, and the UK is in many respects well-positioned to grasp them, but at the same time the risks to our competitiveness of not stepping up to the challenges in this area are drastic. The Tech Partnership estimates that 134,000 new tech specialist workers are needed in the UK workforce every year, but employers are finding it hard to recruit for these jobs. A further alarming constraint is that only 17% of entrants into the sector are women.

The committee’s report identified the need for an overarching and ambitious digital agenda for the UK, co-ordinated by government acting as “conductor of the orchestra” of all the different interests involved, particularly in business and education, and with a Cabinet-level Minister having overall responsibility. Key elements of such an agenda would include recognition of high-speed broadband access as a utility service, so that everyone, whether in a remote rural area or one of the so-called urban “not-spots” where broadband coverage is currently poor, should be able to use the internet freely and effectively. Digital literacy should be seen as a third critical skills dimension, along with literacy and numeracy. Digital skills should be embedded within every level of education and training in schools, colleges and universities, as well as in all apprenticeships.

Now is not the time to rehearse all the recommendations of the committee’s report. The only other one I will mention is the recommendation that:

“Regional and sub-regional strengths are recognised and encouraged”.


In that context I welcome the Government’s commitment to the concept of the northern powerhouse. There are already good examples of effective regional technology clusters in the north, such as Sunderland Software City, a private sector, publicly backed organisation whose aim is,

“to generate a sustainable software industry in the region and drive the development of world class software businesses”.

The title of the committee’s report is Make or Break: The UK’s Digital Future and I believe that that phrase in no way exaggerates the importance of this issue. I hope that the Minister will be able to say how the Government plan to address it, across all departments, with urgency, vigour and commitment, and in partnership with other key players in business, education and the regions, as a central part of their efforts to enhance UK productivity.

Education: English Baccalaureate Certificate

Lord Aberdare Excerpts

Monday 14th January 2013 Lords Chamber

[Lord Aberdare]

My Lords,

“Music is both an art and a science; to comprehend it fully requires long, hard study; to feel the emotions it can produce, you need a cultivated mind and a practised sense of hearing; and to judge the merit of musical works, you must also possess a well-stocked memory so as to be able to make comparisons—indeed you must know all sorts of things which inevitably you can get to know only by learning them”.

That is a quote from Hector Berlioz, my personal musical idol. It seems pertinent to this debate, on which I congratulate my noble friend Lord Clancarty.

I only really began to appreciate classical music at university. I do not, however, believe that would have happened if I had not been lucky enough to go to a school where I was made to sing, to learn the rudiments of music theory and history, and to attend concerts—as well as briefly taking piano lessons. Without that foundation, I might never have discovered Berlioz, nor would music—and the arts in general—have played such a key part in my quality and enjoyment of life.

That is just what I have gained as an amateur arts-lover. What about all those professionals working in the field of music, in a vast variety of roles and in every different form of music, who have been so successful on the world stage and who, as we have heard, help the UK to earn almost £4 billion a year in gross value added—a figure that rises to over £36 billion if all the creative industries are included? Surely they and their successors need the same sort of grounding at school if this invaluable source of UK competitive advantage is not to dry up.

The Olympics and Paralympics opening and closing ceremonies last year made plain how great a role music plays in our national perception of ourselves and of what we have to offer the world. Nothing could demonstrate more clearly that the arts and creative subjects are every bit as important as the five pillars of the EBacc. In my view, the EBacc has much to be said for it—and I particularly welcome the inclusion of Latin, Greek and ancient history among the languages and humanities options. However, the omission of a sixth pillar for arts and cultural studies could seriously compromise its benefits. It would be disastrous if access to understanding and knowledge of the arts and creative subjects became increasingly confined to those young people lucky enough to go to schools which decide voluntarily to retain them—especially if these are predominantly independent schools. The number of schools already withdrawing arts subjects from the curriculum, and the falling numbers of students taking music at GCSE—mentioned by my noble friend—are deeply worrying.

According to the IBM Institute of Business Value, chief executives identify creativity as the most important leadership competency for the successful enterprise of the future. Many of the nations with which we need to compete are putting substantial resources into educating their young people in the creative disciplines. I hope the Minister will be able to tell us how she plans to ensure that creative subjects, including music, do not become some sort of second-tier option with limited availability following the introduction of the EBacc, with resulting damage to the UK's creative economy.