Winter Heating Initiatives

Lord Callanan Excerpts

Thursday 7th July 2022 Lords Chamber

[The Parliamentary Under-Secretary of State, Department for Business, Energy and Industrial Strategy (Lord Callanan) (Con)]

My Lords, the Government will continue to look at ways to work with energy companies to make homes more comfortable and cheaper to run. To help consumers with rising bills, we are doubling the value of the universal energy bill support scheme to £400 and scrapping the requirement to repay it over five years. Our simple energy advice service provides home owners with advice on decarbonising their homes; we plan to move the service to GOV.UK to improve the user experience.

[Baroness Worthington (CB)]

My Lords, I thank the Minister for his reply. I fear that this Government are somewhat distracted and about to expend considerable effort on picking an unproven loser; I am of course referring to the Energy Bill that was published yesterday and its heavy weighting towards carbon capture and storage and hydrogen. These are expensive and inefficient solutions, and thus will play only a minor role in the transition to a secure, affordable and clean energy system. Energy efficiency and electrifying everything are the clear winners, yet they get scarcely a mention in the 300-plus pages of the Bill. Can the Minister explain what is being done to get energy companies behind delivering these two proven solutions at a pace that will help home owners this winter?

[Lord Callanan (Con)]

Well, we could spend the whole of this Question Time debating those issues. The noble Baroness makes some good points. I am sure that we will have some extensive discussions on those issues during the passage of the Energy Bill. On energy efficiency, I agree with her, of course. It is no secret that I have been working with energy suppliers to try to put in place additional energy-efficiency measures. We will continue to take those forward.

[Lord Redesdale (LD)]

The simplest way of saving money on household bills is through insulation. Will the Government say whether they will redirect their successful efforts in insulating people’s roofs into draught-proofing people’s houses? Some 15% of the energy in a house is wasted through draughts, and a cost-effective method of dealing with that would be a national campaign to deal with draughts in people’s homes.

[Lord Callanan (Con)]

The House and I need no convincing of the value of energy efficiency. As I constantly remind the House, we are already spending considerable sums on energy-efficiency schemes, but I am sure that there is always more that can be done.

[Lord Howell of Guildford (Con)]

First, as well as the improvements that the noble Baroness, Lady Worthington, wisely suggested, has my noble friend noticed that international oil and gas prices are falling quite quickly? They are well away from their original peak. Should we not be ensuring that somehow these benefits get through to households before they are hit by an enormous energy bill increase in the future? Secondly, does my noble friend accept that if we took half the fuel duty revenue off consumers, that would be a huge hit on public revenues, but it would be an even larger saving in public expenditure from the public payments that have to be made linked to indexes? As a result of the fall in the CPI, that would be a win all round. Will he pass that on to the Treasury?

[Lord Callanan (Con)]

I will certainly pass my noble friend’s thoughts on to whoever occupies those great offices in the Treasury in the next few weeks. Regarding his first point, we want to ensure that any reductions in international energy prices are passed on to consumers as quickly as possible.

[Lord Whitty (Lab)]

Does the Minister accept that fuel-poor households will seriously suffer not just during the coming winter but, given the way that the energy market is going, in subsequent winters? Do the Government accept that, in order to deal with the problem of fuel poverty, they need to knock the heads of the energy companies together and introduce proper, targeted social tariffs, and to reintroduce a comprehensive insulation programme that does not depend solely on the rather haphazard procedures under the ECO scheme? That needs to be done as a matter of urgency, in line with the rest of the energy strategy.

[Lord Callanan (Con)]

I am sorry that the noble Lord is so down on the ECO scheme. It is a good programme and, as he is probably aware, we are expanding it to £1 billion a year. It is not the only energy-efficiency scheme we have: there is the home upgrade grant, the local authority delivery scheme and the social housing decarbonisation fund, which is about to launch bids for another £800 million of grants to local authorities and housing associations.

[Baroness Hayman (CB)]

The Minister has said the House needs no persuasion of the importance of energy efficiency, yet the Social Housing (Regulation) Bill currently in front of the House contains no mention of energy efficiency and makes no requirement to take it into account for social housing landlords. Will he have a word with his noble friend Lord Greenhalgh, who is in charge of that Bill, to see whether that can be remedied in Committee? The Energy Bill has 370 pages, and 10 lines alone for the Long Title, so, given that we are dealing with it in very short order, I wonder whether he can assure me that that Bill is fitter for purpose than the Schools Bill and the Procurement Bill have been?

[Lord Callanan (Con)]

There were a number of questions there. The noble Lord, Lord Whitty, mentioned the considerable sums that we will expend on the social housing decarbonisation fund; that funding will be matched by local authorities and housing associations, so we will get more bang for our buck. I am sure that we will have many debates on the Energy Bill. A considerable amount of work has gone into it. There will be some additions to the Bill to cover late policy changes, but I will outline those to the House at Second Reading.

[Lord Flight (Con)]

My Lords, is there any information about the extent to which domestic heating costs are benefiting from global warming?

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[Lord Callanan (Con)]

That is a complicated subject but, irrespective of the impact, we can all agree that energy efficiency is a good thing. Using less energy and spending less money on it is an all-round good societal benefit.

[Baroness Blake of Leeds (Lab)]

My Lords, the previous Chancellor—forgive me if I do not have the appropriate way of expressing that—introduced additional payments for the cost of living crisis and they were welcomed across both Houses, but I think we can all agree that they came far too late. At every step the Government have been playing catch-up, which is why an emergency package was needed. Many thousands of households are still struggling, and when winter comes round again energy prices in particular will hit hard, and that is before any mass rollout of energy-efficiency schemes—if they come along—can possibly be in place. Will the Government learn lessons and put support in place in time to avert even more misery next winter?

[Lord Callanan (Con)]

I am slightly confused by the noble Baroness’s question. Yes, of course, we are rolling out the energy bills support scheme, which is a £400 payment that will be delivered through energy bills directly to all consumers. There is a considerable package of support. I could list all the other measures if the noble Baroness had time but there is a £37 billion package of cost of living support across the economy.

[Lord Forsyth of Drumlean (Con)]

My Lords, could my noble friend help me? Surely the easiest way to help people faced with large energy bills is to remove the tax from them and cut the 5% rate of VAT?

[Lord Callanan (Con)]

Of course, the rate of VAT has already been reduced on some energy-efficiency measures, but my noble friend makes a good point and I will be sure to convey it to the Treasury.

[Baroness Blower (Lab)]

My Lords, I am sure the Minister recognises that the cost of energy is having a very bad effect on education budgets in schools. I hope he will be liaising with whomever ends up at the Department for Education to see what can be done to ensure that schools are properly heated, as cold children cannot learn and cold teachers cannot teach.

[Lord Callanan (Con)]

The noble Baroness makes a powerful point. I point to the public sector decarbonisation scheme, for which I am responsible, which has already rolled out billions of pounds’ worth of improvements to all our public buildings to help make them more energy efficient.

[Baroness Garden of Frognal (LD)]

My Lords, £400 to households is surely a profound waste of public money since a lot of it is going to people who really do not need it. Why can the Government not target the money more closely at people who truly need it?

[Lord Callanan (Con)]

I look forward to seeing the Liberal Democrats campaigning on taking away from people money that has been allocated. It is a universal payment but of course there are considerable extra funds that have been closely targeted. There are shortages and problems across the economy. That is one part of the package but there are many other parts of the package directed at those most in need.

[Baroness Foster of Oxton (Con)]

My Lords, for the first time this winter we in the United Kingdom imported shale gas from the USA. Could my noble friend the Minister please tell the House when the report will be published on shale gas extraction for the future?

[Lord Callanan (Con)]

My noble friend makes an important point. The Secretary of State has asked the British Geological Survey to have an additional look at the problems and evidence surrounding the whole issue of shale gas extraction. I would say that the environment in this country is very different from that of the US, but we will certainly respond to that as quickly as we can.

Horizon Europe

Lord Callanan Excerpts

Thursday 7th July 2022 Lords Chamber

[Viscount Stansgate]

To ask Her Majesty’s Government what alternative plans they have prepared in the event that the United Kingdom is no longer a part of the Horizon Europe research programme.

[The Parliamentary Under-Secretary of State, Department for Business, Energy and Industrial Strategy (Lord Callanan) (Con)]

My Lords, the Government remain committed to associating to Horizon Europe. We remain disappointed that the EU is politicising science co-operation by delaying association. If the UK is unable to associate soon, we are ready to introduce a comprehensive alternative programme that delivers many of the benefits of Horizon through international collaboration, end-to-end innovation and a strong and attractive offer to encourage talented researchers to build their careers here in the UK.

[Viscount Stansgate (Lab)]

My Lords, I thank the Minister for that Answer. This is the third time that I have asked that Question and it is always the same disappointing Answer. I forget—forgive me—whether or not the Secretary of State in the Minister’s department is still in post, but I am a great admirer of the current Minister for Science, who is doing a good job.

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[Lord Callanan (Con)]

The Minister the noble Lord refers to, one of my ex-colleagues, was doing an excellent job in putting together precisely the programme that the noble Lord asks for. We remain hopeful that the EU will change its position, live up to its obligations and agree to co-operate in science. That is the best way forward for both parties. If it does not, we have allocated £6.8 billion over the spending review period to put in place an alternative programme.

[Lord Purvis of Tweed (LD)]

My Lords,

“chaos in No10, breakdown of Cabinet collective responsibility and collapse of public confidence in government represents a constitutional crisis. It is also now seriously undermining our authority in key negotiations on the world stage at a time of urgent international crises”

and “destroying our credibility”. Every single word of that was from the ex-Minister George Freeman this morning. How on earth can we secure a good deal for our nation abroad when at home the Conservative Party is inflicting, in his words, “a constitutional crisis” on us?

[Lord Callanan (Con)]

It is clearly a difficult political time at the moment but I have great faith in the institutions of this country. I am sure we will get through it and continue the excellent work that this Government have been doing on all those matters.

[Lord Patel (CB)]

My Lords, let us hope that we succeed with the remaining part of the Horizon Europe programme. I appreciate that the Government are committed to putting that same money back into research but can the noble Lord confirm that the money will go to research, which is where most of our Horizon Europe programme money goes, and not be earmarked for other purposes not regarded as research? While he is at it, can he update us on developments with ARIA?

[Lord Callanan (Con)]

I can indeed give the noble Lord that assurance. The money is a direct replacement and will go to research, but our preference remains to associate to Horizon Europe, if possible. With regard to ARIA, the noble Lord can expect some announcements on the chairman and chief executive fairly soon.

[Lord Reid of Cardowan (Lab)]

Does the Minister accept that this is not just a question of money? Scientific advance depends on international collaboration, networking, exchange of information and so on. Does he accept the gravity of the present situation? Universities are the seed funding of any solution to the productivity issue that is central to economic recovery. At the moment, however, we are cutting ourselves off from Europe, we are suspicious of China and we are introducing a range of legislation, not least the National Security and Investment Act, that will bring great concern and instability to our universities. What measures are the Government taking to address the gravity of that crisis and to assuage that instability, particularly in our institutions of higher education?

[Lord Callanan (Con)]

There were many different questions there. First, I agree with the noble Lord about the importance of international science collaboration. Secondly, we are not cutting ourselves off from the rest of the world. We remain keen to associate to Horizon Europe and co-operate with other scientific nations across the world. Thirdly, I do not agree with his point about the National Security and Investment Act causing problems for universities. The system is working extremely well and applications are being approved smoothly, as he will see if he looks at the recently produced annual report.

[The Earl of Kinnoull (CB)]

The sorry state of affairs is, of course, the result of the impasse over the Northern Ireland protocol. Can the noble Lord the Minister assure us on two fronts—first, that the plan B concepts will not be brought forward until absolutely the last moment when it is not possible practically to join this iteration of the seven-year Horizon programme, which would come not before the end of this year; and, secondly, that if a plan B comes forward, it would be structured in such a way that the future co-operative and collaborative matters that the noble Lord, Lord Reid, talked about can be taken advantage of because it would be possible to collaborate with a future Horizon programme?

[Lord Callanan (Con)]

Indeed, the Northern Ireland protocol is the excuse that the EU gives for refusing to live up to its commitment. These are separate agreements and issues. We would prefer them to be completely separate. We want to associate with Horizon Europe because it is in both our interests. There should be international science collaboration, as I said in response to previous questions, and we remain willing to sit down and implement the agreement that was entered into, just as soon as the EU is prepared to talk about it.

[Baroness Blake of Leeds (Lab)]

As we have heard, the Minister who floated the plan B to replace Horizon Europe is no longer in place. But even before the Government fell apart, neither the Cabinet nor the Treasury had signed it off, anyway. Can the Government now confirm whether these plans are dead in the water and explain how they will take responsibility to protect the British academic sector from further damage before the UK’s associate membership ends?

[Lord Callanan (Con)]

I do not know if the noble Baroness was listening to the replies that I gave but the Treasury is fully committed to the £6.8 billion announced in the spending review. The Government remain keen to get on with this and associate to Horizon Europe if we can, but we are putting in place alternatives that will be just as effective in terms of international co-operation. We will spend similar amounts of money.

[Baroness Garden of Frognal (LD)]

UK participation in Horizon Europe has been of immeasurable benefit to our researchers but, because of their calibre, it has also been of immeasurable benefit to our one-time EU partners. Producing our own scheme will not be the same. What efforts are the Government putting into negotiations to ensure that we can continue to participate in Horizon to our benefit and that of our Horizon partners, too?

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[Lord Callanan (Con)]

I agree with the noble Baroness that this co-operation has benefits for both sides and it is a shame that the EU continues to drag science into wider politics. Now, more than ever, we believe that we should be working closely together with like-minded partners, but it is difficult for us to negotiate if we have no one on the other side willing to talk about it.

[Baroness Foster of Oxton (Con)]

My Lords, there is no justifiable reason for the UK not to be part of the Horizon programme. Does my noble friend agree that this is due not to any reticence from the UK Government but to the EU dragging its feet and placing unnecessary obstacles in the way?

[Lord Callanan (Con)]

My noble friend is exactly correct.

[Lord Davies of Brixton (Lab)]

My Lords, the Minister referred to plan B, and the financial commitment is obviously to be welcomed. Does he agree that the most important issue here is not finance but the international networks established for research? I should like to quote Professor Dame Anne Johnson, president of the Academy of Medical Sciences, who said:

“Horizon Europe provides an important and established framework for the networks and relationships that underpin international health research and benefit patients’ health everywhere.”


Does the Minister accept that it is the international networks that are crucial?

[Lord Callanan (Con)]

Money is of course important but I agree that the international networks, both with the EU and wider partners, are also crucial. That I why we should like to associate with Horizon Europe if the EU is prepared to sit down and discuss these things with us and to live up to the commitments it made in the TCA. I am sorry that many Members of this House are prepared to make excuses for the EU on this. We agreed it and are prepared to live by the commitment. It is the EU that is refusing to honour what it signed up to.

Strikes: Cover by Agency Workers

Lord Callanan Excerpts

Tuesday 5th July 2022 Lords Chamber

[Lord Woodley]

To ask Her Majesty’s Government what discussions they have had with (1) employers, (2) employment agencies, and (3) trade unions, about their plans to remove regulation 7 of the Conduct Regulations 2003 to allow agency staff to cover for striking workers.

[The Parliamentary Under-Secretary of State, Department for Business, Energy and Industrial Strategy (Lord Callanan) (Con)]

My Lords, the removal of Regulation 7, which gets rid of an outdated blanket ban on employment businesses supplying agency staff to cover strikes, is about ensuring that the British public do not have to pay the price for disproportionate strike action. We consulted extensively on this in 2015 and have carefully considered the responses received when deciding to proceed. In our view, further consultation is unlikely to bring up fundamental issues not already raised.

[Lord Woodley (Lab)]

I thank the Minister for his response, but he will not be surprised to hear that it is just not good enough. He has not consulted trade unions or employment agencies and, with respect, he does not even want to consult Parliament. That is the simple truth of it. Just last week—and I am not sure whether this is government policy—he claimed that unions do not represent anybody. That is crazy stuff—tell it to the 6 million trade unionists in this country. Will he at least listen to the bosses of Hays, Adecco, Manpower and 10 other major UK recruitment firms when they warn him that these strike-breaking proposals are likely to inflame and prolong disputes, not solve them?

[Lord Callanan (Con)]

The noble Lord will not be surprised to know that I do not agree with him. We did consult the trade unions; in fact, the TUC submitted a petition of 25,000 names against the proposals, so they clearly had a chance to comment. We will of course consult Parliament when the regulations are debated.

[Lord Fox (LD)]

My Lords, there is a huge workforce crisis across the United Kingdom and a shortage of people. Does the Minister not believe that, rather than using agencies to cross picket lines, he should be working with agencies and other groups to try to plug the hole in Britain’s workforce?

[Lord Callanan (Con)]

I am not sure of the point the noble Lord is making. We want to work with all the appropriate agencies to, as the noble Lord says, plug the hole in the workforce.

[Lord Collins of Highbury (Lab)]

My Lords, what sort of importance do the Government place on international trading partners meeting their commitment to the ILO’s fundamental conventions? If the noble Lord thinks it is important, can he tell us what assessment the Government have made of the compatibility of these regulations with the Human Rights Act, the EU-UK Trade and Cooperation Agreement, and the UK’s commitment to the ILO’s fundamental conventions, including article 3 of convention 87?

[Lord Callanan (Con)]

We are confident that we are meeting all our international obligations. We are not interfering with the right to strike; workers still have the right to take strike action, provided they fulfil the legal tests required. We are confident in our legal advice on this.

[Lord Balfe (Con)]

My Lords, when these regulations are repealed, will the Government make sure that suitable points are put in place to safeguard worker and consumer safety? Some agencies have objected on the grounds that unqualified people might be drafted in to do these jobs. It is important that safety regulations are in place to look after consumers and workers, whether they are in trade unions or not.

[Lord Callanan (Con)]

I agree completely with my noble friend’s point. None of these regulations affects the existing safety provisions. Any staff who are drafted in will have to meet all the appropriate safety obligations that existing workers meet.

[Lord Watts (Lab)]

My Lords, why do the Government need the most restrictive measures in Europe? Why can they not follow the German model of working with working groups and trade unions to resolve disputes before they happen? What has changed between now and the P&O dispute, when the Government took a very hard line? They seem to be now doing exactly the same as P&O.

[Lord Callanan (Con)]

We are always happy to work with organisations that want to work with us. The P&O situation is entirely different; it seems clear that P&O acted unlawfully, although that is being investigated at the moment. We have a commitment to bring in legislation for minimum wage protection for seafarers.

[Lord Hendy (Lab)]

My Lords, prices have been rising at 9.1% per annum and wages are rising, on average, at 4%. This means that working people are looking at a cut in real wages of 5% per annum. Would not the Government be better off trying to cap prices, rather than undermining trade unions for defending the living standards of working people?

[Lord Callanan (Con)]

If the view of the modern Labour Party is that capping prices is effective in a modern industrialised market economy then I truly despair.

[Lord Whitty (Lab)]

My Lords, do the Government actually believe that there is a right to strike? In the railways dispute and in the potential disputes for airline staff, the votes were overwhelmingly in support of strike action and these strikes are absolutely legal, yet the Government seek to use secondary legislation to completely undermine the trade unions. Has Jacob Rees-Mogg convinced the Tory party that we should go back to the 18th century Combination Acts?

[Lord Callanan (Con)]

The answer to the noble Lord’s question is yes.

[Noble Lords]

Oh!

[Lord Callanan (Con)]

I meant yes in terms of believing in the right to strike; let me clarify that for the benefit of the House. Nothing in these regulations inhibits the right of workers to go on strike. It is worth pointing out that employers can currently employ people directly to take the place of striking workers. All these regulations would do would be to allow for them to bring in agency workers—although, of course, they still have to meet all the appropriate safety provisions my noble friend mentioned earlier.

[Lord Snape (Lab)]

My Lords, is it any coincidence that these proposals are being made during the course of a dispute in the railway industry? Is the country supposed to believe that there are agencies out there that can recruit signallers, train drivers or booking clerks to take over the jobs of those who are on strike? Is this not yet another example of an overpromoted Secretary of State seeking a newspaper headline?

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[Lord Callanan (Con)]

This is not specifically targeted at the current rail strikes. The regulations will apply to all sectors of the economy, not just the rail sector.

[Lord Fox (LD)]

My Lords, the noble Lord, Lord Woodley, mentioned the letter that the heads of the major agencies wrote to the Secretary of State. In that letter they said:

“we can only see these proposals inflaming strikes—not ending them.”

Will the Government take the advice of these experts in employment and back down from this measure?

[Lord Callanan (Con)]

If agencies do not wish to take part in the freedoms offered by these regulations then it is entirely their right not to do so.

[Baroness Chakrabarti (Lab)]

My Lords, this is hardly St Francis of Assisi, is it? As this is not specifically about the rail workers, are the Government confident that they will find these armies of agency junior doctors and junior barristers down the track?

[Lord Callanan (Con)]

As I said, this applies in all sectors of the economy. Agencies already supply a considerable number of personnel in the fields that the noble Baroness mentioned.

[Lord Sikka (Lab)]

My Lords, even the Prime Minister condemned P&O’s violation of employment laws, and now the Government are going ahead with implementing those despicable practices in UK law. Could the Minister tell us what other bad practices they are ready to implement?

[Lord Callanan (Con)]

I answered that question earlier. This is an entirely different situation from the P&O dispute, as it was at the time. We were committed to taking action to prevent abuses such as that, and we are still committed to that. This is an entirely different situation.

[Lord Wallace of Saltaire (LD)]

My Lords, agencies might be able to help with one or two spare government appointments at present: independent adviser to the Prime Minister, chairman of the Conservative Party, et cetera. Have the Government considered approaching the agencies on that?

[Lord Callanan (Con)]

The noble Lord pursues an innovative line of questioning that I did not consider in all the preparation I did for this. It is clearly something that I will want to bear in mind.

Post Office: Horizon Compensation

Lord Callanan Excerpts

Thursday 30th June 2022 Lords Chamber

[The Parliamentary Under-Secretary of State, Department for Business, Energy and Industrial Strategy (Lord Callanan) (Con)]

My Lords, with the leave of the House, I will now repeat a Statement made by my honourable friend Minister Scully in another place:

“With permission, I will make a Statement on the latest steps that the Government are taking to ensure that swift and fair compensation is made available to postmasters impacted by the Horizon IT scandal.

This House is well aware of the terrible impact felt by the many postmasters affected by issues with the Post Office’s Horizon IT system, which began over 20 years ago. These distressing consequences have been widely documented both in the courts, in the 2019 group litigation order judgments, and in the more recent Court of Appeal judgments, as well as in the media. I would like to pay tribute to colleagues on both sides of the House who have supported postmasters in their efforts to expose the truth and see justice done.

Today, I would like to take the opportunity to update the House on the latest steps that the Government are taking to ensure that fair compensation is paid to people impacted by the Horizon IT scandal. As you all know, the members of the GLO performed a great public service by bringing the case in 2019 which exposed the scandal. That is why I was pleased that the Chancellor announced in March this year that further funding is being made available to ensure that they receive similar levels of compensation to that which is available to their non-GLO peers.

Today, I can update the House that the Government intend to make an interim payment of compensation to eligible members of the GLO who are not already covered by other compensation support, totalling £19.5 million. Together with the share of the December 2019 settlement that we understand was distributed to the GLO postmasters, this brings the total of compensation to about £30 million. Postmasters will be contacted in the coming weeks to submit an application, after which we aim to distribute the funds within a few weeks of receiving their application. I hope this will go some way in helping many postmasters who have, and still are, facing hardships.

In parallel, we are continuing to work at pace on delivering the final compensation scheme for the GLO. I can confirm that we will be appointing Freeths to access the data and methodology it developed in relation to the distribution of the 2019 settlement. Freeths represented the GLO claimants and has vital knowledge and expertise based on its involvement in the case. This will allow us to work at pace on the design of a scheme with the JFSA and Freeths to give those in the GLO similar compensation to their non-GLO peers.

As promised in March, we will informally consult with members of the GLO about the proposed scheme’s operations. I am also pleased to announce that members of the GLO group will be able to claim reasonable legal fees as part of participating in the compensation scheme. I hope this will allay any concerns that they might have about meeting the costs of seeking legal advice and support when applying to the scheme.

Turning now to progress on compensation for overturned criminal convictions, I am pleased to report to the House that interim payments are progressing well. As of 27 June, there have been 75 overturned convictions, with the most recent convictions being overturned in recent weeks. The Post Office has received 73 applications for interim payments, including several new applications in recent weeks. Sixty-seven offers have been accepted by claimants, with 66 payments totalling nearly £7 million paid out in compensation so far. This marks significant progress, with nine additional interim payments made to postmasters since I updated the BEIS Select Committee on 11 January 2022.

I am pleased that these interim payments have helped to deliver an early down payment on the compensation due to affected postmasters in advance of full and final compensation packages being agreed. For those postmasters with an overturned conviction who have already submitted quantified claims, I can share that we are working with the Post Office to agree part-payments of agreed elements of claims, such as loss of earnings, wherever possible and will continue to do so with additional claims which are submitted.

Taking this step should enable us to avoid undue delays by awarding partial compensation while outstanding matters are resolved. I acknowledge that one area where it has been challenging to agree compensation is non-pecuniary damages, some of which reflect the wider impact on postmasters’ lives that these wrongful convictions have had. These include compensation for the loss of their liberty or impacts on their mental health. A number of the postmasters have agreed to refer this issue to the process of early neutral evaluation, to be conducted by former Supreme Court judge Lord Dyson. It is hoped that this evaluation will facilitate the resolution of these issues. Government stand ready to support the delivery of the early neutral evaluation process and are keen to ensure that the outcomes of this process enable swift compensation. I urge all postmasters with a Horizon-related conviction to continue to come forward to seek to have these overturned. They are being contacted individually by the CCRC and other relevant bodies to encourage them to do so.

In addition to the progress on compensation for those with overturned criminal convictions, good progress has been made on delivering compensation for those in the historical shortfall scheme. As of 23 June, 65% of eligible claimants have now received an offer, meaning £29 million has now been offered and that 444 further postmasters have been offered compensation since my last update to the House. I would like to thank the independent panels for their diligent work in progressing these cases. As I have said previously, I have set the Post Office the ambition to make 100% of HSS offers by the end of the calendar year, and the Government are working closely with the Post Office to achieve this.

As I have said before, it is important—in addition to providing compensation—that we learn lessons so that something similar can never happen again. That is why the Government have set up the Post Office Horizon IT inquiry and put it on a statutory footing to ensure that it has all the powers it needs to investigate what happened, establish the facts and make recommendations for the future. We are co-operating fully with the inquiry to ensure that the facts of what happened are established and lessons learned.”

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[Baroness Randerson (LD)]

My Lords, I thank the Minister for his commitment on this issue and for his Statement today. As he knows, when I was first involved in this, as a Member of the Welsh Assembly in the early 2000s, even then it was obvious that there was something very seriously wrong. In a crowded room in a pub, with so many people, and their families, who had been regarded as pillars of the community—the sort of people who went to look for pensioners who had not come to collect their pension to check that they were all right—I was being asked by the Post Office to believe that those people had taken its money. That definitely jarred with me at the time.

The big questions are these. How has this been allowed to take so long? How was it covered up for so long? What will happen to those people within the Post Office and Fujitsu who knew that they were covering up problems? I realise that there will have been people who were doing so without realising that they were involved in a cover-up, but there were many who knew. We must also consider the impact on the Post Office as an institution, which had previously been one of the most trusted British institutions.

The Minister has already addressed some of my questions, but I have a few questions on today’s Statement. First, I welcome the interim payments that are announced, but the amount of money sounds relatively modest given the time it has taken to get to this place. They are interim payments, but can the Minister tell us how many people the £19.5 million will be going to, so that we can get some measure of how much they will receive in the interim? The Statement refers to postmasters being contacted in the coming weeks and so on. Can the Minister give us a target date by which he hopes the interim payments will be made? We have had so much delay here. Finally, because I realise that time is short, 75 convictions have been overturned. Are there more in the process at the moment? Does the Minister expect there to be other overturned convictions?

What will the Government do about payments for those who have already died? As this process has taken more than two decades, many of the people involved in this process are now very elderly, and some of those who have died did so as a result of suicide because of the situation in which they were placed. What plans do the Government have to compensate the families of those who died and the families that stumped up large amounts of money to avoid their relatives going bankrupt as a result of misplaced allegations?

[Lord Callanan (Con)]

I thank the noble Lord, Lord McNicol, and the noble Baroness, Lady Randerson, for their statements and questions. The noble Lord already knows that I totally share his frustration. His statement about stressful uncertainty for the postmasters sums up the issue very well, and I totally agree with him. I am also very happy to join him in paying tribute to my noble friend Lord Arbuthnot and Kevan Jones; I know that a number of other parliamentarians, on all sides of the House, have also been involved in this. They are truly a tribute to parliamentarians, who get criticised for a lot of things, but when there are scandals such as this, it shows the role that Members of both Houses can play in bringing the public’s attention, and indeed the Government’s attention, to them.

On the questions the noble Lord and the noble Baroness asked about the overall timescale, the ambition is that all offers will have been made by the end of the year. The GLO interim payments will be made within weeks. The noble Lord asked for an assurance that the core funding of the Post Office is unaffected, and I can give him that assurance. He also raised the issue of the directors of the Post Office: they can be held to account by the inquiry, as indeed can Ministers and officials involved in this. We are determined that there will be no hiding place for those who contributed to this scandal. He also asked about further private prosecutions. Right at the start of this scandal, when I spoke to the chief executive of the Post Office, he assured me that it had no plans to bring any more private prosecutions. I would be very surprised if it went back on that, given the trouble that this has got it into. The noble Lord also referred to Post Office complacency. That may have been the case in the past, but I think the new leadership under Nick Read is really producing a change in the culture and some real improvements in the service the Post Office is offering.

The noble Baroness, Lady Randerson, referred to cover-ups; there probably were, but that is of course a matter for the inquiry to establish. She asked how many people will receive compensation. The £19.5 million in interim payments goes to all members of the GLO scheme, of whom there are about 500. I can also confirm for the noble Baroness that in cases where some of those members have sadly died, we are engaging with their next of kin and their estates on seeking appropriate levels of compensation.

[Lord Arbuthnot of Edrom (Con)]

My Lords, again, my noble friend comes before this House with good news, and I am truly grateful for that. We look forward to the day when the compensation scheme can be completed, and we hope it happens early so that sub-postmasters can have truly substantial payments.

As the public inquiry considers the responsibility of Fujitsu, Post Office directors and others, can my noble friend the Minister assure your Lordships that the inevitable delay arising from the public inquiry will not cause to be legally time-barred any redress that might need to be taken in relation to those who are at fault?

[Lord Callanan (Con)]

I can give my noble friend a very quick answer to that: yes, I can give him that assurance. Once again, I pay tribute to the work he has done in exposing this scandal.

[Viscount Stansgate (Lab)]

My Lords, I thank the Minister for repeating the Statement and apologise for briefly having left the Chamber while he was making it. I pay tribute to the noble Lord, Lord Arbuthnot, and others for the work they have done in bringing this scandal to public attention. My question arises in the light of the previous one, and it is about the public inquiry. Can the Minister tell the House how long it might take, for the obvious reason that the sooner it is completed, whatever its outcome, the sooner we can be reassured that a scandal of this kind can never happen again?

--- Later in debate ---

[Lord Callanan (Con)]

I cannot give the noble Lord a timescale. Obviously, we want it to conclude as quickly as possible, but it needs to be thorough and to go into all the facts. Of course, it is in the hands of the chairman of the inquiry to determine exactly how long it should take.

[Lord Cormack (Con)]

My Lords, we are all very grateful to my noble friend the Minister, and to my noble friend Lord Arbuthnot. He and Minister Scully have pursued this with vigour and deserve our thanks. These people, who have gone through hell, are being compensated but no compensation can be truly adequate. An idea has occurred to me which I commend to the Minister: could these people, who have been exonerated and compensated, be issued with a medal for meritorious service to the Post Office?

[Lord Callanan (Con)]

That is an interesting idea that I will take back and discuss with officials.

[Lord Macpherson of Earl’s Court (CB)]

My Lords, I very much welcome the Minister’s Statement, particularly the announcement of the public inquiry. But however speedy these are intended to be, they have an uncanny knack of going on for several years, so can the Minister confirm that both the Post Office and its sponsoring department have conducted internal inquiries, albeit on an interim basis, the better to learn the lessons now?

[Lord Callanan (Con)]

Officials and, I am sure, Ministers are keen to learn the lessons, but the inquiry is the best place to fully go into all these matters, which took place over decades, as I said. It will get to the bottom of this and the appropriate individuals will be held responsible.

[Lord Forsyth of Drumlean (Con)]

My Lords, I congratulate my noble friend on the brilliant job he has done on this, but can he help me on the question of Fujitsu? We do not need a public inquiry to tell us that the software was deficient; we have reports of whistleblowers saying that they knew it was. So why is the taxpayer having to pick up the bill for this, and why is Fujitsu not being forced to pay up? If it is not prepared to do so, why on earth are we allowing it to do any work for any Government or anyone else with whom we have influence?

[Lord Callanan (Con)]

As my noble friend knows, I have considerable sympathy with his points, which, on the face of it, seem obvious. But we need to wait for the inquiry to positively establish the facts and lay them out in stark detail before considering what further steps to take.

[Lord Polak (Con)]

My Lords, I had the honour of entering this House at the same time as my noble friend Lord Arbuthnot. We have been friends for many years, and I too congratulate him on his tenacity and effectiveness; it has been outstanding, and many people around the country are grateful to him. I was intrigued by what the noble Baroness, Lady Randerson, said about the Welsh pub. I have consistently tried to personalise this by mentioning my friend Rita Threlfall on every occasion, because this is about individuals and their families; it is not about the figure of 555, which almost means nothing. I entirely agree that no amount of money can restore their dignity. I also entirely agree that my noble friend and Minister Scully have done their best, but it is not enough. I was going to finish by saying what has just been said: I do not understand why Fujitsu is not paying for this. Can the Minister explain why it is not financially responsible for this and why the taxpayer is paying, as was said?

[Lord Callanan (Con)]

Again, I have considerable sympathy for the points that my noble friend makes, but, so far, Fujitsu has not been found guilty of any fraud or other crime related to this matter. It is co-operating in full with the inquiry, as we would expect of it. I realise that this is uncomfortable for the House, but we should wait for the results of the inquiry to set out in stark detail exactly where the failings were.

[Baroness Altmann (Con)]

My Lords, I associate myself with the tributes paid to my noble friend Lord Arbuthnot and Paul Scully in the other place, and with the congratulations offered to the Government on bringing forward payments at last, at least in many cases. The Statement talks about reimbursing “reasonable” costs of legal action. I understand that going forward, because we have to guard against egregious costs being imposed, but for those who have already had to take legal action, can my noble friend assure the House that there will be full recompense for all the legal expenses that they have had to go to, in addition to which there will be compensation for the suffering that they have clearly been through?

[Lord Callanan (Con)]

If my noble friend is talking about the GLO legal action, of course the costs of that were funded and the lawyers were not paid by the litigants; a lot of the compensation went to pay the legal fees, which is part of the problem with the GLO scheme.

[Viscount Stansgate (Lab)]

I hope the House will allow me the flexibility to take advantage of the fact that we have a few moments left in this exchange. Will the terms of reference of the inquiry—forgive me for not knowing the detail of them—encompass the role of the judiciary, which after all succeeded in sentencing an enormous number of postmasters to prison? Will it be a feature of the inquiry when it is held to investigate how that was possible?

[Lord Callanan (Con)]

The inquiry can cover all relevant matters. Of course, the role of the judiciary is being examined in the cases proceeding through the courts at the moment and in the convictions being overturned. I am sure that all those members of the judiciary still in their posts will pay close attention to those cases. To be fair, they can adjudge a case only on the evidence that is presented to them, but I am sure that they will want to take careful account of any technical evidence that was given in the various cases and perhaps treat it with a bit more scepticism in future.

[Lord Cormack (Con)]

I am grateful to my noble friend for his reception of my suggestion. It occurs to me that if we could have a public ceremony in, let us say, Westminster Hall, where these people were publicly recognised and given a medal, it really would do something for their morale.

[Lord Callanan (Con)]

As I said, it is an interesting proposition, and we will certainly have a look at it.

Trades Union Congress: Levelling Up

Lord Callanan Excerpts

Wednesday 29th June 2022 Lords Chamber

[Lord Balfe]

To ask Her Majesty’s Government when the Prime Minister last met with representatives of the Trades Union Congress to discuss how trade unionists can work with the Government to level up the economy and build back better.

[The Parliamentary Under-Secretary of State, Department for Business, Energy and Industrial Strategy (Lord Callanan) (Con)]

My Lords, the Prime Minister last had a meeting with the Trades Union Congress last December. The Department for Business, Energy and Industrial Strategy works with trade unions, and positive relationships are essential to developing and delivering our policies. During the pandemic, engaging with the unions was important to our work supporting jobs and keeping workers safe. Continued engagement will support the Government’s ambitious levelling-up agenda.

[Lord Balfe (Con)]

I thank the Minister for his reply. As he will know, of the 6 million-plus trade unionists, a third vote for the Conservative Party. Indeed, the Labour Party has recently told its members not to go near picket lines, so it has made its position pretty clear. Can the Minister say whether he would consider—since the basic values of many trade unionists are at least small “c” conservative—that it is now opportune for us to make a pitch to them to show that this Government represent many of their core values? We should encourage them to work with us, because we occasionally will go on a picket line.

[Lord Callanan (Con)]

I will take that as a statement from my noble friend himself rather than the Front Bench. The Labour Party may indeed have told its members not to sit on picket lines, but it did not make any difference at the end of the day. My noble friend makes a serious point of course. Our policies, with record low levels of unemployment and the highest ever minimum wage, are good for workers and we should be proud to say so.

[Lord Woodley (Lab)]

My Lords, it seems to me that the premise at the heart of this Question is the wrong way round. The Government should be supporting those 6 million trade unionists in this country who are really struggling to survive the cost of living crisis that is before us. They should not be undermining them by allowing bad bosses to break strikes with agency workers while, at the same time, the shareholders and directors are cleaning up. Does the Minister understand that the best way to build back better is to empower workers and trade unions so that they can hold unscrupulous employers to account?

[Lord Callanan (Con)]

I am sorry to tell the noble Lord that I just do not share this outdated methodology that, on the one hand, you have workers and, on the other, you have bosses. We are all working together for the good of the country. The thing about the trade unions in this country is that they are now a minority profession: only 13% of workers in the private sector and only half of those in the public sector are in trade unions. The reality is that they do not represent anybody.

[The Lord Speaker (Lord McFall of Alcluith)]

My Lords, the noble Lord, Lord Jones of Cheltenham, will make a virtual contribution.

[Lord Jones of Cheltenham (LD) [V]]

[Inaudible]—responsibility for good industrial relations, which are of course vital for a successful economy. On the subject of levelling up, would the Minister have a word with the boss of Sainsbury’s, whose annual salary has trebled to £3.9 million while he denies a living wage to many of his hard-working employees?

[Lord Callanan (Con)]

Believe it or not, the pay levels in Sainsbury’s are nothing to do with the Government—it is a private sector company. If people like the service provided by Sainsbury’s, they will go to that supermarket; if they do not, they will go to others.

[Lord Lennie (Lab)]

My Lords, in 2019, across the UK as a whole, one in five jobs were paid less than the real living wage. This figure excludes the self-employed, half of whom earn significantly less than the living wage. For levelling up to have meaning, the TUC has set out recommendations in a report snappily called Levelling Up at Work. Does the Minister agree that it is time that the Government stop fighting the trade unions and work with them to secure jobs across the UK, have decent pay levels and help families overcome the cost of living crisis in this fifth-largest economy in the world?

[Lord Callanan (Con)]

Of course we want to work with all employee representatives who are prepared to be constructive and who want to see a positive way forward for the country that does not hold the travelling public to ransom. No doubt the noble Lord will also be delighted to know that we raised the minimum wage again in April and put another £1,000 in the pocket of the lowest-paid workers.

[The Lord Bishop of St Albans]

My Lords, the Government are to be congratulated on raising the minimum wage and I thank them for what they have done. There is, however, a really serious point here. As we are facing a serious range of strikes across many industries, the worry is that those people in positions of leadership and authority are not necessarily giving a lead. The question is: how can politicians and business leaders show that they are sharing in the big challenges, the financial challenges, that are coming up? Importantly, although modest rises among those in leadership will not make a huge difference to the overall financial package, it will send out a really strong signal that we are all in this together.

[Lord Callanan (Con)]

I am grateful that the right reverend Prelate recognises the increase in the minimum wage, which is good for so many of the lowest paid workers. It is important for those at the top of businesses to take a lead: they want to take their employees with them and to provide a good service to their customers, and all employers should bear that in mind.

[Lord Tugendhat (Con)]

My Lords, the Minister is of course quite right when he says that the trade unions are not as powerful as they were during the last period of inflation, but they are still a very important element in the economy, and if the Government are to be seen to be tackling the cost of living crisis effectively, they really need to be able to show that they are seeking the opinions, advice and support of all sections of the community, and that includes the trade unions.

[Lord Callanan (Con)]

My ministerial colleague, the Minister for Small Business, regularly meets with the trade unions. Another meeting is planned, I believe, in the next few weeks. So yes, of course it is important to gauge the opinion of trade unions, but I did not use the word “powerful”; I said they were a minority interest. I repeat: only 13% of workers in the private sector, the most productive sector of the economy, are now in trade unions.

[Viscount Stansgate (Lab)]

My Lords, since the Minister says that relations between the Government and the TUC are positive, why does the Prime Minister not direct the Transport Secretary to convene a meeting between the rail unions and the rail employers in order to bring about a settlement to the railway dispute?

[Lord Callanan (Con)]

Because the responsibility for sitting down belongs to the employers—in this case, Network Rail and the train operating companies—and the trade unions. My understanding from listening to Network Rail is that it has set out a very positive agenda. At the end of the day, the taxpayer supported the railways to the tune of £16 billion over the last few years: that is £160,000 for every rail employee in this country. The taxpayer has been very generous; it is about time the unions reciprocated.

[Lord Sikka (Lab)]

My Lords, last week the Chancellor met with oil and gas company directors to hear their concerns about energy policy. With that in mind, will the Minister explain why the Transport Secretary has not met the RMT? Which law prevents him doing so?

--- Later in debate ---

[Lord Callanan (Con)]

If the RMT were prepared to seek a more constructive relationship and to provide a service to the travelling public, maybe the Transport Secretary would be prepared to meet it.

[Lord Wallace of Saltaire (LD)]

My Lords, the Government are currently adding a large number of amendments to the procurement Bill already before this House. Have they thought that in the large number of procurement contracts they sign with private business, they could perhaps add, under the definition of “public benefit”, that companies that pay their chief executives vastly more than the average for their workers could have a black mark against gaining contracts from the Government? I am thinking in particular of some of the consultancies and auditing companies that have quite excessive salaries at the top.

[Lord Callanan (Con)]

I fear that I am not familiar with the provisions in the procurement Bill. It is not a Bill that I am responsible for, but I will certainly have a look at the point the noble Lord makes.

[Lord Monks (Lab)]

My Lords, I think the noble Lord, Lord Balfe, might find that his voting figures are a bit shaky after last week’s by-election results. Why are the Government messing around with more antiunion legislation at a time when they are also lifting the cap on bonuses, doing absolutely nothing about inflation in boardrooms and in some parts of financial services, and ignoring their own experience of working closely with unions on the furlough scheme, which worked very well and was very successful? That experience should provide a blueprint for tackling the cost of living crisis, so will the Government make an effort, a proper effort, to find common ground in the current very difficult circumstances, instead of stoking conflict with the unions?

[Lord Callanan (Con)]

Nobody is stoking conflict with the unions. I do not know what antiunion legislation the noble Lord is referring to, but if he means the minimum strike guarantee, that was a manifesto commitment. I would have thought he would be in favour of a service being provided to the travelling public to enable other ordinary men and women to go to work when they want to do so.

Small Modular Nuclear Reactors

Lord Callanan Excerpts

Tuesday 28th June 2022 Lords Chamber

[Viscount Hanworth]

To ask Her Majesty’s Government when, and under what circumstances, they will place orders for small modular nuclear reactors.

[The Parliamentary Under-Secretary of State, Department for Business, Energy and Industrial Strategy (Lord Callanan) (Con)]

My Lords, the energy and security strategy sets out our intention to take one nuclear project to final investment decision in this Parliament and two projects to final investment decision in the next, including SMRs. As with any government decision, this will be subject to value for money, relevant approvals and technological readiness and maturity.

[Viscount Hanworth (Lab)]

I am not reassured by the Answer the Minister has given. To await the completion of a generic design assessment of a proven technology is to impose an unnecessary delay. There is an international market awaiting small modular reactors. Unless the Government provide full and immediate support for the SMR of Rolls-Royce, foreign producers will capture the market and we may have to depend on them for the reactors we will need to install in the UK. Does the Minister regard that prospect, and the prospect of losing overseas markets, with equanimity?

[Lord Callanan (Con)]

We are providing immediate support to Rolls-Royce to develop the SMR; we provided it with £210 million to do exactly that. However, it is important that we go through all the relevant design approvals to make sure that SMRs are safe and easy to deploy. That is an important step to go through and which is legislated for in this country, and we should make sure that we follow it.

[Lord Bilimoria (CB)]

My Lords, building a large nuclear reactor takes well over a decade but, once built, it can power 7% of this country’s electricity. However, I am reliably informed that these small modular nuclear reactors can be put up within four to five years. Why are the Government waiting? These reactors can power a city the size of Sheffield. Why not do it now in order to have cleaner energy and to be more energy self-reliant?

[Lord Callanan (Con)]

The noble Lord might want to ask the people of Sheffield whether they want an SMR beforehand. As a serious point, this is very important; indeed, it is a matter of legislation that reactors are proved to be safe. I agree that it is a shrunken design of existing reactors; these are on a much smaller scale and designed in a modular way. It is important that we go through all the relevant approval processes. The design is not yet complete, and they have not even been submitted yet for GDA.

[Lord Cunningham of Felling (Lab)]

My Lords, can the Minister remind the House of when Britain built a civil nuclear reactor on time and within budget? I ask this not to cast any doubt on the Minister’s commitment, but to say that we know that there are numerous opponents of civil nuclear power and every time we build a reactor we give them more and more excuses over delays and cost overruns to attack the idea of civil nuclear power. It is a terrible error for which both Governments have been responsible; I am not just blaming the present Government. We give them open goals to shoot at. Should the Government not look at the whole process and come up with a new scheme or ideas to ensure that this error is eliminated?

[Lord Callanan (Con)]

We are always open to new ideas for how we can speed the process up. We want to see both existing nuclear technology and the SMR process brought forward as quickly as possible, but it is important that we go through all the relevant design approval phases to make sure the technology is safe. Many communities are willing to accept SMRs, particularly those that already have nuclear reactors in their area, so it is not the case that everybody is opposed to them. Nevertheless, it is important that we go through the proper processes.

[Lord Howell of Guildford (Con)]

My Lords, I declare an interest both past and present in this area. I welcome the support the Government have so far given to SMR development in this country. Of course, it is going on in many other countries as well. How does this play out in relation to the plan at Sizewell C, where the idea is to build another large-scale reactor as a replica—I repeat, replica—of Hinkley Point C? Hinkley Point C has had its own problems; it is over time, over budget and has component difficulties. Do we really want to think in terms of a large-scale replica there or in other sites, when the SMR option is coming on fast? We are at the edge of new technology in nuclear power; should the Government not think very carefully before deciding between SMRs and another large-scale reactor with all its problems, as already indicated?

[Lord Callanan (Con)]

My noble friend makes an important point, and we will take into account all these factors, including value for money, when we make decisions in the next Parliament on whether to proceed in these cases.

[Lord Wigley (PC)]

My Lords, may I break the habit of a lifetime and welcome the statement made by the Prime Minister in his speech in Newtown last month, when he announced an SMR for Trawsfynydd? Can the Minister confirm that the five-year timescale announced by Cwmni Egino, which will be taking this forward, is within the framework of what he has just described and that this project will go ahead for 2027?

[Lord Callanan (Con)]

I cannot confirm any individual projects, but I have said that we are proceeding with making final investment decisions in the next Parliament on two further nuclear reactors.

[Lord Ravensdale (CB)]

My Lords, I work in the nuclear industry and one of the biggest issues I am currently seeing is a lack of available skills to undertake the work. We are doing our best to recruit, but we simply cannot find the skilled engineers to meet the demand we are seeing. Does the Minister agree that a sector-wide skills strategy is needed to demonstrate how we will deliver the more than 100,000 new jobs in the industry that will be needed by 2030?

[Lord Callanan (Con)]

The noble Lord makes an important point. There are a lot of very skilled engineering jobs. We have made some errors in the past on our nuclear strategy, which resulted in a lot of very skilled employees leaving the country and the industry effectively closing down. We are resurrecting the industry now and it will be a longer-term process to build up the skills base, but the noble Lord is right.

[Baroness Blake of Leeds (Lab)]

My Lords, although we on these Benches welcome an increased rollout of small modular nuclear reactors, given that they offer savings in cost and construction time and more flexibility related to energy demand, it will likely take until 2024 for the first project to reach a final investment decision. Furthermore, Rolls-Royce does not expect to turn on its first SMR until 2029. This is a positive long-term strategy but it does not address the short-term and immediate need for action. Can the Minister inform us of what solutions the energy security Bill offers to reduce our dependency on oil, coal and gas in the short term?

[Lord Callanan (Con)]

The noble Baroness makes an important point; these are long-term decisions. Most energy policy decisions are longer term, as it takes many years to bring on stream new energy infrastructure projects in whatever field we are looking at. In the short term, however, the answer to the noble Baroness’s question relies principally on renewables: we are advancing the hydrogen strategy and accelerating the rollout of offshore wind, which has proved immensely successful. In this country, we have the second-largest offshore wind capacity in the world and it is a world-beating industry.

[Lord Stoneham of Droxford (LD)]

Could the Minister confirm whether the Government consider regulated asset base—RAB—funding appropriate for something as experimental as these small reactors?

[Lord Callanan (Con)]

We have not made a decision on the relevant business case model—it could be either the RAB or the CfD model—but we will consult on this shortly.

[Lord Naseby (Con)]

My Lords, my noble friend knows as well as anyone that we have suffered an energy crisis and continue to have one. Against that background and the vacillation over the North Sea, which is not my noble friend’s fault, does he not think that, given Rolls-Royce’s history and what it did during the war—twice as quickly as anyone forecast—it is a major company that can really get a grip on this, if Her Majesty’s Government push the button for it to do so?

[Lord Callanan (Con)]

I agree with my noble friend’s point: Rolls-Royce is indeed an excellent company, which is why we are funding it to do this work.

[Baroness Jones of Moulsecoomb (GP)]

My Lords, I am so glad that the Minister mentioned safety because a recent study from Stanford University says that, overall, small modular designs are “inferior” to conventional reactors—

[Baroness Jones of Moulsecoomb (GP)]

It is not my work; it is from a university. The study says that they are inferior with respect to radioactive waste generation, management requirements and disposable options. The researchers make the point that they should not be doing this research; the vendors should. Will the Government make sure that such research is done by vendors?

[Lord Callanan (Con)]

Of course they are doing that research. A vital part of the work and the financing model will be to make sure that all decommissioning costs are taken into account, which is one of the advantages of the SMR process: SMRs will, we hope, be easier and cheaper to decommission. But this is all part of the design process that we are going through, and it will be subject to the proper regulatory approvals. I obviously do not agree with the noble Baroness’s anti-nuclear stance, but it is nevertheless important fully to take into account the safety approvals process.

Warm Home Discount (England and Wales) Regulations 2022

Lord Callanan Excerpts

Monday 27th June 2022 Lords Chamber

Moved by

[Lord Callanan]

That the draft Regulations laid before the House on 12 May be approved.

Relevant document: 2nd Report from the Secondary Legislation Scrutiny Committee. Considered in Grand Committee on 20 June.

Motion agreed.

Warm Home Discount (England and Wales) Regulations 2022

Lord Callanan Excerpts

Monday 20th June 2022 Grand Committee

Moved by

[Lord Callanan]

That the Grand Committee do consider the Warm Home Discount (England and Wales) Regulations 2022.

Relevant document: 2nd Report from the Secondary Legislation Scrutiny Committee

[The Parliamentary Under-Secretary of State, Department for Business, Energy and Industrial Strategy (Lord Callanan) (Con)]

My Lords, these regulations were laid before the House on 12 May.

For 11 years, the warm home discount scheme has ensured much-needed support to millions of households. Since it began, it has provided more than £3.3 billion in direct assistance to households. Primarily, this support has taken the form of direct rebates off household energy bills.

The Government committed in the 2020 energy White Paper to extend and expand the scheme and to reform it better to target households in fuel poverty. These regulations provide for that expanded and reformed warm home discount scheme in England and Wales. Under the regulations, the scheme is set to last until 2026. The regulations succeed the previous warm home discount regulations in England and Wales. The Government will lay separate regulations for an expanded warm home discount scheme in Scotland, which will be debated separately.

The regulations have six main provisions. First, the expanded annual spending envelope is set in the regulations. For winter 2022-23, the spending envelope is £474 million, rising each year thereafter. Secondly, participating energy suppliers will be obligated to provide rebates directly off the energy bills of fuel-poor households. The value of the rebates for households is set at £150—an increase of £10. This means that around 2.8 million households will receive a rebate every winter. Thirdly, the scheme will continue to provide rebates to pensioners on the lowest incomes—those in receipt of the guarantee credit element of pension credit. This “core group 1” of eligible pensioners, as it is known, has been a key feature of the scheme throughout its existence.

Fourthly, there will no longer be a “broader group” of other low-income and vulnerable households. Under the former scheme, this group was required to apply to their supplier every year for a rebate. Even if eligible, these households were not guaranteed to receive a rebate, and the criteria varied by supplier. The Government are therefore creating a “core group 2” of households on the lowest incomes and with the highest energy costs. Eligible households will be those in receipt of one of the qualifying means-tested benefits or tax credits and meeting a high energy cost threshold. These households will be identified through data matching using benefits data, property characteristics data and energy supplier customer data. The Government intend to publish a statement setting out the exact details of the eligibility, including the high-cost threshold.

Fifthly, these regulations make it mandatory for suppliers to contribute to Industry Initiatives. Industry Initiatives allow suppliers to fund other financial and energy-related measures such as financial assistance payments, debt write-off, benefit entitlement checks, energy advice and energy efficiency measures. Industry Initiatives will be set at £40 million for this winter and rise each year thereafter. The regulations also set minimum obligations and caps regarding financial assistance. This recognises the value that they provide, while ensuring that other high-value Industry Initiatives measures still receive funding.

In addition, the Government are maintaining aggregate and household-level caps on debt write-off to avoid this measure being misused to reduce bad debt. The last Industry Initiatives restriction is to limit the number of mains gas-powered boilers and central heating systems that can be installed. These will still be permitted to support particularly vulnerable customers during emergencies but will be restricted to align with the heat and buildings strategy.

Sixthly, and finally, the regulations set the thresholds for suppliers participating in the scheme. The Government are lowering the thresholds so that more suppliers participate, and to reduce the barriers to customers switching suppliers. In 2022-23, the threshold will be set at 50,000 domestic customer accounts; from 2023-24, it will be set at 1,000 accounts. This means that 99.9% of the market is covered.

The Government are expanding the scheme to provide rebates to 750,000 more households. Thanks to these reforms, the vast majority of eligible households will receive their rebates automatically, without having to apply. A small minority will be contacted and required to contact a helpline to confirm their details.

The Government’s analysis shows that, by focusing support on households on the lowest incomes, the fuel poverty targeting rate will increase to 47% overall and 560,000 more fuel-poor households will receive a rebate compared with an unreformed scheme.

The Government held a consultation on these reforms last summer and we published our response in April. The consultation responses supported extending and expanding the scheme as well as proposals for reform. The Government are proceeding with the main proposals; however, we decided to make a number of changes in light of the consultation responses. We have added housing benefit to the list of qualifying benefits, and tax credits in the eligibility criteria for core group 2. Energy suppliers will be required to provide estimates of the value and proportion of spending under industry initiatives in relation to households where a person has a disability or a health condition. This will enable the Government to monitor the level of support provided to disabled customers. The Government have removed the proposed mid-year adjustment to the Industry Initiatives budget. This risked creating significant uncertainty and delivery risks. Lastly, the Government are keeping the overall debt write-off cap under Industry Initiatives at £6 million per year.

The warm home discount remains a source of critical support for many low-income households. The regulations extend this scheme, expand the support to more households and focus that support on those most in need. I therefore commend these regulations to the Committee.

[Baroness McIntosh of Pickering (Con)]

My Lords, I congratulate and thank my noble friend for presenting the regulations before us, which I warmly welcome. I set out my interest on the register, as president of National Energy Action, and raise some of its concerns about these regulations—or rather, what is not in the regulations—with my noble friend and ask for his positive response.

First, I point out that the regulations were drafted at a time when the scheme was very successful, prior to the Covid crisis. I will come on to that in a moment. My first concern is that the way of selecting core group 2, to which my noble friend referred, is potentially unfair. While National Energy Action supports the guiding principle that the Government should help the worst first, the proposed methodology creates a significant risk that some households that are currently eligible for support and live on the lowest incomes could miss out on rebates, if they are falsely estimated to have lower energy costs. The new core group 2 methodology also means that you cannot access a rebate without receiving a means-tested benefit. What happens to the 50% of fuel-poor households that do not currently receive such a benefit? Have the Government considered what will happen in those circumstances?

If a household is not selected as part of core group 2 but should have been, it seems very difficult to contest the decision. The customer journey is not particularly user-friendly. How does my noble friend expect to resolve issues arising from that circumstance? National Energy Action is not convinced that the funding available through Industry Initiatives is sufficient to meet the expected demand. The way that funding has been allocated for Industry Initiatives means there is significant uncertainty about the total available pot each year. The first year of the scheme could see a reduction in funding compared to 2021-22, which does not seem sensible given the energy crisis and is surely not what the Government envisage happening.

The department has still not made amendments to the scheme to ensure that, if and when there is a supplier failure, the supplier of last resort takes on the full obligation of the failed supplier. This means that there is a risk that some obligation can be lost through the process, so that the overall number of rebates is reduced and projects that have been committed to go through industry initiatives actually go unfunded. Then, there is the significant issue that I raised earlier: the scheme was designed for good times and against that background; it was not put together with an energy crisis in mind. Although it is too late to go back to the drawing board now on the warm home discount, could not the Government look at what additional protections are necessary? Given that the Treasury has agreed one-off payments this winter, and that the crisis will outlast that support, something extra might be necessary against that background.

National Energy Action would therefore like to propose a number of things that it believes the Government could do to overcome this. One is to investigate deeper price protection or a new social tariff, which I have raised with my noble friend before. This would make energy more affordable for a discrete and well-defined set of low-income energy customers. Such a tariff must be additional to existing schemes, mandatory for all suppliers, targeted at those most in need, reduce the costs of eligible households and use auto-enrolment. It might need primary or secondary legislation so that it could sit alongside the price cap.

Secondly, will the Government consider accelerating the repayment of utility debts across the UK? This would provide financial support for households that have a debt repayment plan with their energy supplier, with government matching every pound paid by the customer with £1 of Treasury funding. This would help every indebted household, but it would cost £500 million per year.

A further proposal is accelerating the improvement of energy efficiency through three possible methods, the first of which is prioritising parliamentary time for the passage of ECO4 legislation. The second is committing the remainder of the funding promised in the Conservative Party manifesto for upgrading fuel-poor homes. Apparently, the Government have committed only £1.1 billion of the promised £2.5 billion for the home upgrade grant scheme. Committing the remainder would help more than 100,000 households to save more than £750 a year on their energy bills. The third method is setting regulatory minimum energy efficiency standards for rented properties. This would help those in the private rented sector, which has some of the leakiest housing in the UK. Despite winter temperatures being as low as they are, we probably have some of the most poorly insulated housing in the whole of northern Europe.

Finally, I would like to raise the issue of the role of the regulator, which has probably not costed in, in general, the failures of existing energy companies over this past year. Will the department consider a number of measures, such as reducing the standing charge for pre-payment users by recovering SOLR costs on a volumetric basis, and better identifying and acting on the financial vulnerability of energy consumers? Will they ensure that the costs of failed suppliers are spread over a longer period, to reduce the immediate burden on consumers? Will they reduce the wider burden of energy debt on consumers by enforcing licence obligations? Finally, will they work to ensure that all prepayment users can receive a smart meter as a priority, and perhaps have a more general debate on what the role of the regulator in this market should be?

With those specific comments, which I hope my noble friend will look on favourably, I give a warm welcome to the regulations before us.

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[Lord Lennie (Lab)]

My Lords, I thank the Minister for bringing these proposals, which are an improvement on the previous scheme. I also thank noble Lords for their contributions, in particular the noble Baroness, Lady McIntosh, who represented the NEA’s concerns about the core group 2 and how some of them will miss out, on the way that the scheme is set up, on the funding sufficiency—or insufficiency—and on the prepayment customer concerns, which the noble Lord, Lord Teverson, also raised. The noble Lord, Lord Best, is an expert on the private rented sector. We share his concerns about that; I will come on to that in what I have to say. The overall theme of the noble Lord, Lord Teverson, is that it represents a failure in public policy that we have to have this scheme in any place, but here we are: we have to have it and this is, as I have said, an improvement.

The Government have said that they intend to bring forward a new set of reconciliation regulations “later this year”, which is better than “when Parliament has time” or “in due course”, but can the Minister be a little more precise about when “later this year” means?

On the criteria and the algorithm used to estimate energy costs, how satisfied is the Minister that the algorithms used will not lead to an education-type embarrassment for the Government and, therefore, a failure in terms of there being lots of customers who potentially would benefit from this scheme but may then miss out? Have the Government included all eligible households, including persons with a disability, in their revised six criteria for the new scheme?

The scheme has an impact on energy suppliers, the authority and the Government. The energy suppliers are likely to recover their costs from their customers, which is estimated to be £19—a £5 increase on the former scheme. The authority and the Government are likely to incur costs of approximately £22 million for their work in issuing notices and identifying customers eligible for core group rebates. The Secretary of State will conduct a review or partial review of the scheme, and the authority will review participation of suppliers in the scheme and publish an annual report. This is welcome.

However, Labour would introduce legislation to uplift the warm home discount for 9 million working families and pensioners during the present inflationary crisis. As the noble Lord, Lord Teverson, and the noble Baroness, Lady McIntosh, pointed out, this is an extraordinary time for energy costs. I am not saying that it could have been predicted but Ukraine is upon us and, therefore, more may well need to be done in the lifecycle of this scheme.

Core group 2, which has replaced the broader group, will not now have to apply for inclusion in the scheme, which is welcome. However, there will be households beyond that group who remain in fuel poverty, such as those in rented accommodation. They may be on low incomes and with disputed levels of energy use, particularly when they have no access to what proportion of the payment they make to their landlords is for energy supply. They may not be receiving benefits, which would usually give them automatic inclusion. It may be impossible for them to contest their exclusion. The Minister’s observations on this would be very welcome.

If an energy company goes into administration or disappears entirely, will the supplier of last resort take on the full obligation of the failed supplier or are there now no small-enough energy suppliers left—that is, those with 50,000 customers—that can go bust? Have they all gone bust already? The recovery of the scheme from customers will mean that, in some cases, energy companies will be recovering money from those who have received the warm home discount, thus giving with the one hand and taking away with the other. Would Minister like to comment on that?

The overall scheme is likely to add to the rise in the socialisation of the expenses of suppliers of last resort, resulting in a probable £100 contribution to the increased price cap. Have the Government considered whether the scheme should be covered by Exchequer funding or by a wider group of people contributing, not just individual customer payers?

In welcoming the progress the Government have made with these changes to the scheme, there are a number of observations on which I would welcome the Minister’s response.

[Lord Callanan (Con)]

I thank all noble Lords who have contributed to this debate. The context is that, this year, as we all know, we have witnessed an extraordinary increase in the cost of energy. The Government recognise that millions of households across the UK may need further support with the cost of living, in particular energy bills. That is why the Government have so far announced additional support this year worth more than £37 billion, including targeted support for many of those in the groupings we are talking about today—those on the lowest incomes.

All domestic electricity customers in Great Britain will receive £400 off their bills from October through the energy bills support scheme. Meanwhile, more than 8 million households across the UK in receipt of means-tested benefits will also receive £650 as a cost of living payment. Further payments will be made to pensioners and disabled people. The Government remain committed to helping low-income and vulnerable households heat their homes over the coming winter. Although energy efficiency measures provide long-term assistance in reducing energy bills, as the noble Lord, Lord Teverson, reminded us, there is a clear need for direct financial support now. In this context, the warm home discount remains a key part of our overall approach to tackling fuel poverty.

This is the largest expansion of the scheme since it began. In 2021-22, the energy envelope was worth £354 million across Great Britain; in 2022-23, it is rising to £523 million. This scheme will ensure that 2.8 million households in England and Wales receive a rebate off their energy bills each winter right through to 2026. That means that around a third more households than previously will receive a rebate each year. In addition, most will receive their rebates automatically. This means that households will have much more certainty about receiving the payments when they need them most. A large part of my postbag has been people writing to their MPs and then on to me if they have not been selected as part of the core group 2 element; people do not understand how the scheme works.

The Government have recognised the need for certainty about the support to households in Scotland. We recently consulted on an extension and expansion of a separate warm home discount scheme in Scotland. That was as a result of the Scottish Government not being able to make their minds up about whether they wanted to be part of this scheme, not because of any delays on our part. The Government will publish the response shortly and lay the regulations for the scheme in Scotland as soon as possible.

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[Lord Teverson (LD)]

That is a very useful explanation, but will the department look at how accurate it was in retrospect? Will it take a sample of properties and see whether the scheme reflected how things were on the ground to check the effectiveness of the algorithm?

[Lord Callanan (Con)]

Yes, of course we will conduct a process of constant improvement. As more data become available, as universal credit is rolled out, and as EPCs are increasingly rolled out and more properties have one, it will make targeting easier. We will modify the scheme as we go forward, using new and improved targeting data.

I thank noble Lords for the useful points they made. I am pleased that virtually everyone who spoke was in broad agreement that the scheme should continue at this time because it has been very successful at providing householders on the lowest incomes with critical support.

[Baroness McIntosh of Pickering (Con)]

Before my noble friend takes his seat, there seems to be a discrepancy in the figures. My noble friend said that 69% of the fuel poor are in receipt of means testing, which means that 31% are not. The NEA said 50%. I would be interested to know, however many there are, how those who are not in receipt of the means-tested benefit under core group 2 will qualify. Is it the Government’s intention to commit all the funds that were highlighted in our manifesto at the last election?

[Lord Callanan (Con)]

My noble friend has asked me a number of difficult questions. Yes, we want to ensure that as much of the funding as possible is committed to this scheme, perhaps all of it will be. I am not sure what my noble friend is referring to by the funds we promised in our manifesto. Is she referring to energy efficiency? In that case, the majority have already been allocated.

On the targeting of those in fuel poverty, I default to the information that I have been given as opposed to the NEA figures, but if there is a mistake in those numbers, I will write to my noble friend.

Motion agreed.

Contracts for Difference (Allocation) and Electricity Market Reform (General) (Amendment) Regulations 2022

Lord Callanan Excerpts

Wednesday 15th June 2022 Lords Chamber

Moved by

[Lord Callanan]

That the draft Regulations laid before the House on 11 May be approved. Considered in Grand Committee on 13 June.

Motion agreed.

Fire and Rehire

Lord Callanan Excerpts

Wednesday 15th June 2022 Lords Chamber

[The Parliamentary Under-Secretary of State, Department for Business, Energy and Industrial Strategy (Lord Callanan) (Con)]

My Lords, the Government asked ACAS to investigate fire and rehire, and it published guidance in November. The Government have announced their intention to publish a statutory code on fire and rehire in March, and the draft is due to be published for consultation this summer. The code will set out good practice, helping parties to reach a negotiated agreement. In cases of dispute, the code will be admissible in relevant legal proceedings and may result in increased compensation.

[Lord Woodley (Lab)]

My Lords, I welcome the Minister’s response. Codes and consultations are helpful but, with respect, they do not go far enough. Ministers, including the Prime Minister, are paying lip service to condemning fire and rehire as an unacceptable practice. However, talk is cheap; we need legislation to stop the many abuses by numerous big-name companies and others. Today I will introduce a Bill banning fire and rehire, except in the most extreme circumstances—the same Bill that the Government so cynically squashed in another place. Therefore, my question to the Minister is simple: will he do the right thing and back my Bill —yes or no?

[Lord Callanan (Con)]

My Lords, we always do the right thing. I realise that it is an easy soundbite for the noble Lord to say “ban fire and rehire”, but even he would accept that you cannot ban redundancies, for instance if a company is going bust. You would end up banning the rehiring part of the equation.

[Lord Whitty (Lab)]

My Lords, legislation is useful, and I hope the Minister pursues that course, but in the meantime will the Government look very carefully at giving any new contracts to a firm which engages in such atrocious behaviour?

[Lord Callanan (Con)]

We want to see all companies engaging in responsible employment practice. The UK has an employment record to be proud of. We have one of the lowest unemployment rates in the western world, one of our lowest post-war records—down again yesterday. If you contrast that to many countries in the EU or on the continent, with much less flexible labour markets, the best employment right of all is a job.

[The Lord Speaker]

My Lords, the noble Lord, Lord Jones of Cheltenham, is making a virtual contribution.

[Lord Jones of Cheltenham (LD) [V]]

My Lords, I draw attention to my registered interests. Sometimes employment contracts need updating to reflect new legislation. Under current law, if agreement cannot be reached between employer and employee, notice can be given and new contracts offered. Then employees can opt for a tribunal claiming unfair dismissal, but tribunals are taking up to 18 months to determine. What are the Government doing to speed up tribunals?

[Lord Callanan (Con)]

There has been a delay from the pandemic, as in many parts of the public service, but we are doing all we can to make sure that cases are expedited as quickly as possible.

[Lord Brooke of Alverthorpe (Lab)]

The Government promised in their manifesto that there would be an employment Bill. When is it coming?

[Lord Callanan (Con)]

We have said that we will deliver when parliamentary time allows, but there are many other ways of delivering what were manifesto commitments than a formal government employment Bill.

[Lord Hamilton of Epsom (Con)]

My noble friend has pointed out that unemployment levels are at an all-time low, but is he not worried about the rising number of those who are not seeking work?

[Lord Callanan (Con)]

That will depend on the individual circumstances of many people. The pandemic resulted in a number of people reassessing their life choices and if they have decided not to go back into the labour market, I am not sure that is something we can implicitly control. But as I said, we have 600,000 more people in work than before the pandemic and one of the lowest unemployment rates in the western world.

[Lord Monks (Lab)]

My Lords, the Government were right in their condemnation of the disreputable behaviour of P&O Ferries recently, but I also read a lot in the papers about the Government considering introducing a Bill which will make it lawful to replace striking workers with agency workers. I am puzzled about what the difference is between what P&O has done and the kind of thoughts that are obviously alive in Government at present. What is the difference?

[Lord Callanan (Con)]

The difference is very clear. What P&O did is potentially illegal. Investigations into both criminal and civil wrongdoings are ongoing, so I cannot comment on those particular investigations, but if trade unions are considering holding the travelling public to ransom, as many of them are, then it is right that we should look at all available options, and we will do so.

[Lord Lennie (Lab)]

My Lords, British Airways, Accenture, and the DP World-owned P&O Ferries—significant players in the UK economy—have all used fire and rehire to replace their workforce. They have faced down government criticism and the public’s disdain. For this to change, legislation is required to outlaw this practice. Will the Government take a lead by bringing forward a definitive code of practice that bans fire and rehire? Further, will the Government commit now to ensuring that companies found to have been using fire and rehire will neither be awarded contracts for any public body nor be allowed to take over provision of public services?

[Lord Callanan (Con)]

I said that we are committed to bringing forward a code and we will consult on it shortly, but as I said in response to the noble Lord, Lord Woodley, it is a complicated area of industrial relations and employment law. I assume that even the Labour Party would accept that we cannot ban redundancy if a company is going bankrupt. Therefore, by banning fire and rehire we would end up banning the rehiring part of it, which I am sure nobody wants to see.

[Lord Hendy (Lab)]

My Lords, I take the point that banning fire and rehire would be extremely difficult, but what is the objection to regulating it by law?

[Lord Callanan (Con)]

I am grateful to the noble Lord for accepting the point that I am making: it is a complicated area and an outright ban would not be appropriate. Therefore, I assume that he will not support the Bill from his noble friend. However, we are prepared to regulate in this sector, which is why we are talking about introducing a code. That code will have a positive effect and will be able to be taken into account in any industrial tribunal proceedings, potentially resulting in an increase in compensation awarded.

[Lord Watts (Lab)]

My Lords, the Government take credit for the high employment in the UK and compare it with our neighbours in Europe, but if we compare poverty wages in the UK with the EU we find a different situation. Are the Government going to do anything about the poverty wages that exist in this country but are not allowed in other countries in Europe?

[Lord Callanan (Con)]

I am absolutely taking credit, on behalf of the Government, for the record low levels of unemployment. I assume the noble Lord would be arguing something different if the opposite were the case. The minimum wage in the UK was increased by 6.6% to £9.50 an hour earlier this year. We also now have one of the highest minimum wages in western Europe, something else I thought the Labour Party would recognise.

[Lord McLoughlin (Con)]

My Lords, I draw attention to my interest in the register as chairman of Transport for the North. Will the Government, in ensuring that employees get a fair deal, also look at the position of the travelling public getting a fair deal when they are being held to ransom by strikes that are deliberately protracted over a week, which will therefore bring disruption to the travelling network for more than a week, in spite of the fact that the strike days will be only three days and no more?

[Lord Callanan (Con)]

My noble friend makes a very important point. He has long experience of industrial relations. It is almost as if these strikes were specifically designed to make life as inconvenient as possible at some of the worst times of the year for the travelling public. That is unacceptable. They should think again, and I hope the Labour Party will join us in urging the trade unions to think again.

[Baroness Blower (Lab)]

My Lords, clearly the strikes are designed to make sure that those workers who worked extremely hard during the pandemic, and work very hard all the time, achieve decent wages and conditions, but does the Minister agree that, by failing to outlaw fire and rehire as a negotiating tactic, the Government are giving the green light to bad bosses to exploit workers?

--- Later in debate ---

[Lord Callanan (Con)]

I am sorry the noble Baroness does not want to join us in condemning the potential strike action on the railways and elsewhere. As I said, we want to see good labour relations and employer-employee relations conducted in a meaningful and contented spirit, which is why we will try to introduce a code that will regulate these matters.

[Lord Wigley (PC)]

My Lords, does the Minister recall an action 20 years ago in the Friction Dynamics factory in Caernarvon—the former Ferodo factory—where the employer had locked out the employees and hired a new workforce? It was taken to an industrial tribunal. The employees and the union won, but they were unable to get any compensation whatever. Can he assure the House that any forthcoming legislation will safeguard against such circumstances?

[Lord Callanan (Con)]

I am not familiar with that particular case; I will certainly look at it. I would be interested to know why they were unable to enforce the order that was made. Perhaps it was because the company went bankrupt, but I do not know; I would have to look at the particular case.