Brexit: Financial Settlement

Lord Davies of Oldham Excerpts

Monday 13th November 2017 Lords Chamber

[Lord Bates]

There is no doubt that the entire Cabinet signed off on the position of the Florence speech, and that remains the position David Davis is pursuing with vigour and ability in Brussels at present.

[Lord Davies of Oldham (Lab)]

My Lords, the temptation to follow the noble Lord, Lord Cormack, is almost overwhelming, but on this occasion I will resist, to return to the main issue of the Question. We in the Labour Party accept the referendum result, but we will seek to remove the concept of “no deal”, which wrecks confidence as far as British business is concerned. The Minister refers to the fact that other noble Lords have had experience at the Dispatch Box on Treasury matters, but they do not last very long, do they?

[Lord Bates]

I had the benefit of seeing the faces of the noble Lord’s colleagues behind him when he was asking that question, which reminds us that the negotiation is not necessarily easy for any of us, in any party. Where do the Opposition stand on free movement and the single market? The only thing they seem to agree on is that we ought to sign up to whatever is put in front of us. We are saying no—this is a negotiation and we have the right to say no.

Paradise Papers

Lord Davies of Oldham Excerpts

Monday 6th November 2017 Lords Chamber

[Lord Davies of Oldham (Lab)]

My Lords, that is a totally inadequate response given the sense of outrage in the country over what has been revealed in the paradise papers. The Government are trying to say that, after seven years of Conservative Chancellors of the Exchequer and Conservative government, condign action is now being taken against aspects of tax avoidance, which has clearly not happened over the preceding period. Therefore, I do not think that we should take these suggestions seriously. After all, only in the last few weeks the Government have rejected any mention of non-dom status in the Finance Bill and have rejected Labour’s demand that this issue be identified and dealt with in legislation.

The Conservative Party has a great deal to conceal. What is the tax status of the former non-domicile Lord Ashcroft? We noticed that for a short while he figured prominently in the newspapers during the election period but, of course, by then he had already paid half a million pounds into the Conservative election fund. Therefore, we cannot take this Statement at face value. The Government purport to say that they are interested in fair taxation. We have seen their record on that over the last seven years and know that many people in this country are being impoverished by them while they still treat the very rich advantageously.

There is nothing in the Statement about the great global companies and their taxation advantages; we do not get a single mention of any of them. What we do get, because the Paradise papers reveal this, is that there has been maladministration by the Government of the Duchy of Lancaster estates. The Chancellor of the Duchy of Lancaster is the elected Member responsible for those estates yet, following the revelations of the Paradise papers, the Queen herself has had her name dragged down by these assertions. The Government do not even think that they owe Her Majesty an apology, because there is no suggestion in the Statement that they recognise that the fault lies with poor government administration.

We seek a full public inquiry into tax avoidance. Nothing less will restore our nation’s confidence that the Government’s approach to this whole wretched issue is adequate.

[Lord Bates]

The noble Lord asked what we had done about tax over the past seven years. The Statement mentioned that we have collected £160 billion in compliance revenue since 2010, that the tax paid by the richest 1% is now 28% of the total, which is more than it was under the previous Labour Government, and that we have introduced initiatives such as a diverted profits tax to tackle just the sorts of corporate manoeuvring of tax, revenues and incomes that he talked about. We have introduced the Criminal Finances Act to make it a criminal offence for employees of organisations, be they professional services firms or others, to give advice on avoiding tax. We are at the forefront of the OECD tax initiatives. This Government included in the Finance Bill, which will come before this House on 15 November, a measure to make it no longer possible to have non-dom status in perpetuity—we are ending that position. Therefore, we have done a great deal but we are not complacent. We recognise that there is an issue to be addressed and fairness will be at the heart of all our actions.

European Investment Bank

Lord Davies of Oldham Excerpts

Tuesday 31st October 2017 Lords Chamber

[Lord Bates]

The Chancellor of the Exchequer would echo those words. He has made it clear that a continued relationship with the EIB may be possible and indeed desirable, but that is a matter to be negotiated because at present the EIB’s constitution and formation does not allow for it to happen. Changes will need to be made, but in the meantime it is important that we make clear that we believe that the full rights and obligations which come to the UK as a member of the EIB and its partner organisation, the European Investment Fund, should remain fully intact and that UK borrowers should have equal access with other members while we are exiting the European Union.

[Lord Davies of Oldham (Lab)]

My Lords, things are already happening. Is the Minister aware that a current project to provide support for businesses in the north-east is now on hold because the European Investment Bank is meant to provide half the resources towards it? Action is already being taken to the disadvantage of a section of the British people, even while the Government are involved in this situation.

[Lord Bates]

That is a fair point. The North East Finance application by seven local authorities was put forward. Following the triggering of Article 50, the EIB took the view that it wanted to undertake an additional level of due diligence to make sure that the UK would stand by its obligations after exiting the European Union. We believe we have confirmed that position by producing our position paper on privileges and immunities. We were delighted to see that the EIB, at its September meeting, had started to approve loans again for after that period. We wish North East Finance well in that.

Consumer and Personal Debt

Lord Davies of Oldham Excerpts

Monday 23rd October 2017 Lords Chamber

[Lord Bates]

There is no need for people to engage in any of those kinds of activities. Help is there, including in the shape of the advance, which over 50% of people now take advantage of, and which can be based on that element. We need to remember that universal credit was brought in with cross-party support, with the very purpose that it would stop the perverse incentives which meant that, under the previous benefit system, people could work more hours and be worse off, and move them to a system where people would always be better off if they worked. We now need to address the details, which my right honourable friend the Secretary of State is doing.

[Lord Davies of Oldham (Lab)]

My Lords, the crisis is upon us, and it is evident that it is. Will the Minister recognise that the Government have an opportunity tomorrow to accept an amendment tabled by the Opposition for a breathing space for debtors? During the general election, of course, the Conservative Party was in favour of this proposal. Can he not see that the urgency of the situation demands that the Government act positively tomorrow?

[Lord Bates]

The Bill is about improving the quality of debt advice to those in need of it and has been broadly welcomed. My noble friend Lady Buscombe has tabled a number of amendments which will be discussed on Report. As I have already said, we remain committed to the concept of a breathing space and will bring forward details on that very shortly indeed.

South Africa: Money Laundering

Lord Davies of Oldham Excerpts

Thursday 19th October 2017 Lords Chamber

[Lord Bates]

I do not accept that we are behind the curve on this. In many ways, the UK is leading the world: at the G20, in the Financial Action Task Force, and with the regulations that we have put in place and the reform of the Financial Conduct Authority. That is why this year the Financial Conduct Authority handed out one of the toughest fines ever levied—£163 million—to Deutsche Bank for failing to comply with up-to-date money laundering regulations. We are very tough on this, but we realise that you have to be vigilant all the time. Therefore, when issues are drawn to our attention, we respond to them quickly and appropriately.

[Lord Davies of Oldham (Lab)]

My Lords, this is a very big issue in South Africa, and it will not do for the Government to suggest that they have their eye firmly on the ball. At last we are getting some response, but it is quite clear that a number of British banks have got very significant interests in South Africa. It is important that action is taken now to make sure that these banks are clear of this corruption and, if they are not, that action is taken against them. I urge the Minister to reinforce what he has said today elsewhere. It will not do Britain’s reputation any good at all for us to be tardy on this very significant issue.

[Lord Bates]

I totally agree with the latter part of the noble Lord’s point. That is exactly why we have taken action in referring this matter to the Financial Conduct Authority. That is why we passed the Criminal Finances Act in April this year and introduced the tough new anti-money laundering regulations in July this year. That is why we introduced, just yesterday in your Lordships’ House, the Sanctions and Anti-Money Laundering Bill, which my noble friend Lord Ahmad will take through the House. We are taking this very seriously because we realise the consequences of not doing so for the reputation of the City of London and the UK.

Sterling: Euro Exchange Rate

Lord Davies of Oldham Excerpts

Monday 9th October 2017 Lords Chamber

[Lord Bates]

We can certainly say that a number of those elements are, rightly, matters that are independent of government. The Bank of England has been given the UK macroeconomic mechanisms to make those judgments on interest rates. Interest rates are at an historically low level. Exchange rates can have a negative effect on imports but a positive effect on exports. It is important that we emphasise that the fundamentals of the British economy remain strong. Employment is at record levels and we continue to grow and expand, and we want to see that continue. That is very much the positive outcome we want from this complex negotiation.

[Lord Davies of Oldham (Lab)]

My Lords, if the economy is so strong, why was our credit rating reduced recently? Sometimes Governments preside over the depreciation of their currency in order to improve their balance of payments and trading position. Why is that clearly not working under this Government?

[Lord Bates]

Since 2010, the economy has grown by 15.3%. That is 1.5 times the level of France. I do not necessarily want to remind the noble Lord, who was standing on this side of the Dispatch Box during 2008-09, that the economy contracted by 6.3% during that period. The fact that we have record levels of employment and are seeing sustained growth should be welcomed and built upon.

Mental and Physical Health: Insurance

Lord Davies of Oldham Excerpts

Tuesday 12th September 2017 Lords Chamber

[Lord Bates]

While we recognise the great service and the demands placed on GPs and their practices in this regard, most people who seek support, particularly for mental health issues, are not necessarily going through private healthcare providers but seeking it through the NHS and through GPs themselves. That is why it is important to put on record that the funding going into mental health services within the NHS is at record levels—it is now at £11.6 billion—and we have the Five Year Forward View for Mental Health, under which that figure will grow year on year. That is not to be at all complacent; we are very mindful and cognisant of those important strains and how they are responded to.

[Lord Davies of Oldham (Lab)]

My Lords, I am just back from Bhutan, a constitutional monarchy that has been in existence for only nine years and needs some help with the development of democracy. However, the noble Lord, Lord Layard, went there a few years ago after his book Happiness and the king welcomed him on the basis that this was part of the constitution of Bhutan—one of their key issues is increasing support in the area of mental health. I hope that the Minister will convince us all that the Government give similar priority to mental health in this advanced country.

[Lord Bates]

First, welcome back. It is good to see the noble Lord in his place. I do not know how long he was away in Bhutan, but there has been quite a bit of movement in this area in recent years. The Health and Social Care Act, led through this House by the noble Earl, Lord Howe, played an important role. It introduced parity and this was a significant advance. The serious discussion in the media now about mental health issues—particularly among young people—and how we respond to them, and the resources which are moving into this, bode well. As to whether we will match the constitution of Bhutan, I can say that parity of esteem is now in the constitution of the NHS.

Charities (Pre-consolidation Amendments) Order 2011

Lord Davies of Oldham Excerpts

Wednesday 27th April 2011 Grand Committee

[Lord Phillips of Sudbury]

My Lords, I thank my noble friend the Minister for the way in which she gave a tour d’horizon of this statutory instrument. As she rightly says, this is a prelude to the consolidation Bill, which starts in this House next Thursday, although I do not think that anyone will be there—I notice that the Commons is not sitting on that day.

A very important aspect of the debates on the Charities Bill that led to the Charities Act 2006 was that we were to have a consolidation measure. I was, I think, foremost in urging that and in getting the Government to put it into the Bill so that we could be quite sure that it would happen. As my noble friend again so rightly says, the danger with our efforts here is that, while they might be just about comprehensible to the specialist lawyer, the Charity Commission, the parliamentary draftsmen and the civil servants involved, they are a closed book to everyone else. Given that 95 per cent of our charities have no paid staff, and that all trustees are volunteers, it is a very serious predicament. Although the consolidation measure is more than 300 pages, it will go some little way to making life a tad easier for those who are doing the job on the ground.

I should like to refer to two aspects of this statutory instrument. Noble Lords may agree that there can be few pieces of legislation more sleep inducing than the Charities (Pre-consolidation Amendments) Order 2011. Indeed, so arcane is most of the language that you have to be a bit of an egg-head to plunge into its depths.

[Lord Davies of Oldham]

Oh!

[Lord Phillips of Sudbury]

I beg the noble Lord’s pardon. I thought that the noble Lord, Lord Davies, had uttered a witticism.

[Lord Davies of Oldham]

My Lords, I was merely expressing approval of the fact that it is the noble Lord who is displaying his egg-head qualities.

[Lord Phillips of Sudbury]

I should like the Minister to give a little explanation of paragraph 10 of the schedule to the order, and I have given her notice of that. The paragraph goes to the heart of the relationship between this order, the consolidation Bill and the Houses of Parliament. To be frank, try as I did, I could not perfectly understand where things were left by paragraph 10. My understanding is that, if in Section 17(2) of the 2006 Act the Minister is given the power to make an order, it is superfluous then to go on to say,

“and a draft of the order shall be laid before Parliament”.

That follows. However, I became a little lost with the omissions and additions later in paragraph 10, and if the Minister is able to cast enlightenment on that I shall be most grateful.

My only other point is more substantial and concerns paragraph 24 of the schedule to the order, which relates to Section 79(2) of the 1993 Act. This is an important provision in the Act. At the start, paragraph 24 says that in Section 79(2) the word “ratepayers” is to be omitted. This provision is designed to ensure that parochial charities have a governing body or a group of trustees that is fit for purpose in the 21st century. Section 79(2) of the 1993 Act, as amended by the 2006 Act, says that the Charity Commission may allow the appointment of trustees to parochial charities in the circumstances described in Section 79(2). Paragraph 24(1) says that “ratepayers” shall be deleted from the description of those persons who shall have power in future to appoint trustees, or at least it does not eliminate their powers to appoint but it affects the right of the commission to make an order appointing additional charity trustees. My problem with paragraph 24—and I read it many times—is that sub-paragraph (2) seems to be wholly superfluous. It says:

“Nothing in sub-paragraph (1) affects any appointment of a charity trustee made before the commencement of that sub-paragraph”—

that is, before the consolidation Act comes into effect. As I said, that is wholly superfluous because one cannot make retrospective legislation other than in rare circumstances and with the greatest possible clarity and want of ambiguity. That is my first point.