UK-US Trade and Tariffs

Lord Bishop of Southwark Excerpts

Thursday 3rd April 2025 Lords Chamber

[Baroness Gustafsson (Lab)]

My Lords, it is a joy to be here with the noble Lord again, and I thank him for his question. Why do we not work with all sides and not just the US? My role is Minister for Investment, and I love trade and investment—and I do not see that this is a matter of decisions. I want to have a strong and vibrant trading relationship with the US, I want to have a strong and vibrant relationship with Europe, and I want to have a strong and vibrant trading relationship with many of the emerging economies. This is something that we can navigate; it is not a situation where we need to pick one at the cost of the other, and I am really excited about seeing how we build and develop on all those trading relationships all around the world.

On growth, I share the noble Lord’s passion. I believe that the digital trade that we have is a huge opportunity. Already there is a lot that we do in the services piece that is worthy of celebration. Stitching that together alongside the digital surely has to be the future of the growth-driving economies that we see coming out of the UK. If I can promise noble Lords one thing, it is that I will be an advocate and ambassador as we champion the growth that we can drive through digital trade.

[The Lord Bishop of Southwark]

My Lords, I am grateful to the Secretary of State for his cautionary words in the other place, repeated here, about eschewing simplistic solutions and “loud voices”, following the imposition of these arbitrary and unwarranted tariffs, and to the shadow Secretary of State for advocating cool heads. That is vital.

Does the Minister agree that, if the impact of this very regrettable development is to depress economic activity—which is all too likely, sadly—there needs to be a priority assigned to protect the most vulnerable in this country from its effects? Will she further comment on any co-ordinated action with other countries to mitigate the effects on those territories, particularly in the Commonwealth, whose economic resilience is far less than our own?

[Baroness Gustafsson (Lab)]

I share the right reverend Prelate’s passion for making sure that we are supporting not just businesses and consumers but communities and people—the people who live in the communities that are affected. A fulsome response is one that is felt by all. At this point, we are still hypothesising; we are still understanding what the implication could be, whether a trade agreement could be arranged and whether reciprocal tariffs could be made. We are still at a point where we need to understand and turn that theory into understanding the real impact on our economy, what it may look like and who would be the hardest hit. But absolutely—if this is something where we are going to see communities damaged, we will be looking to think about how we can support them through that.

National Insurance Contributions (Secondary Class 1 Contributions) Bill

Lord Bishop of Southwark Excerpts

2nd reading
Monday 6th January 2025 Lords Chamber

[The Lord Bishop of Southwark]

My Lords, I wish to make three quick points on this, the largest and probably most consequential, measure announced by the Chancellor in the Budget. My first point is very tentative, as it relates to the promises on taxation made by major parties prior to general elections. We are an unelected House, and I am deeply conscious of the peculiar pressures that political parties navigate to put across a message and compete with their opponents, but I think, wishfully perhaps, that greater restraint by parties on what they promise in the area of taxation would be appropriate since the House of Commons should have maximum freedom to pass a Finance Bill in our overall interests. I cannot be alone in thinking that placing such a burden on employer national insurance because of prior commitments ruling out other possible options is less than optimal and is already seemingly restraining economic growth.

My second point is that the Church of England agreed in 1976 to forgo the pre-existing arrangements whereby ministers of religion were treated as self-employed and embrace employer national insurance. The increases mandated by this Bill affect us as they affect others. The impact nationally for a full year, including clergy, is around £10 million, excluding large numbers of staff directly employed by parishes. For my diocese, the amount is around £390,000. Our principal income source for paying all stipend-related costs comes from voluntary parish giving, which is restricted, and we have still not heard from the Treasury whether it will extend the listed places of worship grant scheme which gives VAT refunds for listed church repairs.

Our parishes and dioceses sustain extensive social outreach as well as support for other charities. Do His Majesty’s Government appreciate the risk of staff and clergy reductions and the closure of buildings as a consequence of these measures in the worst-case scenario? This is mirrored, as I am sure the Minister has been advised and as we have already heard from other Members, by the impact on hospice care—much of which originated in Christian foundations—where the additional government help will not address the shortfall, despite the urgent need highlighted in the debate in another place on the assisted dying Bill.

However, my principal point has been raised in the briefing sent to a number of your Lordships. It is the impact of the proposed increases on the transport sector that is devoted specifically to serving children with special educational needs. As I understand it, local councils will be covered by proposed grants and compensation for the increases in this Bill where they directly employ staff in school transport. However, this does not extend to private industry, which employs some 100,000 people in this sector as drivers and passenger assistants. Many are part-time, whose employment will be caught by the provisions of this Bill for the first time. All are trained in serving special needs children and many are over 50 years of age. If contracts become unviable as a result of these measures and companies return them to local authorities, it will introduce a degree of turmoil into the lives of children, many of whom are on the autistic spectrum and for whom consistency is vital. Failure to maintain their education because of gaps in SEND transport will have serious consequences. I hope that the Minister will note this. It will further increase unemployment among the over-50s, whom we want to keep from the ranks of the economically inactive. Therefore, will the Minister consider two measures to ameliorate this situation? First, will he consider an emergency grant to local authorities for the fiscal year 2025-26 to address immediate and unplanned shortfalls arising from the increased costs to the SEND transport sector? Secondly, will he submit long-term funding provision for SEND transport services to phase 2 of the comprehensive spending review in order to extend support through to at least March 2028?

I do not intend to vote for the amendment in the name of the noble Baroness, Lady Kramer, but I am grateful for the opportunity afforded at this Second Reading to express my concerns to the House about the impact of the Bill.