Digital Markets, Competition and Consumers Act 2024 (Alternative Dispute Resolution) (Conferral of Functions) Regulations 2026

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Wednesday 25th February 2026 Grand Committee

[Lord Stevenson of Balmacara (Lab)]

My Lords, I am grateful to my noble friend for introducing the statutory instruments. This is not a very complicated issue and I do not have much to say about it, but I do have one or two questions.

First, this emerged from the digital markets Bill, which I was happy to play a part in. I was a bit surprised to see, on the duty to provide reports, that the reports have to be provided to the Secretary of State in writing on a “durable medium”. I wonder why the Government’s choice of words on this appears to rule out the possibility that we might go digital on these as well as many other things. Will my noble friend reflect on that when he replies?

Secondly, my more serious point is about costs and cost recovery. Clearly, an operation such as this under the CTSI must be paid for, but the way it is framed in the instruments before us means that these fees will come only from consumers. If the ADR is to work effectively, it really should be a benefit to both sides: it should be a benefit to the companies that are being queried about by consumers as well as to the consumers. I understand the point about the consumers being charged only a fair fee—this is well laid out in Schedule 1. Can the Minister say why we are not expecting costs to be recovered from those who also benefit from the system—the companies concerned? Obviously, the last thing we want is to find that this is a huge extra burden on already-burdened consumers, who have to pay through the nose both for their own case but also for the case being answered by the other side.

My third point is more general. There does not seem to be much in the documents before us about reviewing these arrangements. This is quite a big change; it is a measure that will set up quite a complex structure. It will be to the benefit of consumers, and I welcome it, but there is a question about whether it will be reviewed and looked at. Can the Minister reflect on that when he responds?

[Lord Fox (LD)]

My Lords, I am grateful to the Minister for his introduction, which was very clear, and to the noble Lord, Lord Stevenson, who asked some of the questions I was going to ask, which is good. I too worked on the Digital Markets, Competition and Consumers Act 2024. It seems longer ago than 2024, and it took a bit of dredging up to come back to this.

In general, we welcome the idea of strengthening the ADR process and how that might then get more people to use it, rather than go into more lengthy disputes —we can talk about that at the end. In the past, as we hear, there was a voluntary registration system, and it would be interesting to hear about the number of practitioners—it would be useful to know the scale—who will need to be registered. Of those, how many were already registered? Do the ones who are currently registered, having volunteered to register, have to reregister themselves and go through another process? What is the scale of the number of dispute resolution operations that will have to be registered? What is the actual process of registration? Is it, “Fill in this online form and you get your registration certificate over the internet”, or are there four-day visits from 15 inspectors—or is it somewhere between that and Ofsted? There is no sense of the scale of what getting registered will mean or indeed of what the cost of getting registered will be.

We need some sense of the scale of the task that the CTSI will have to undertake, which then raises the question: does the CTSI have the capacity to pick this job up? There will be a big fat bulge of people needing to be dealt with at the front end of this. What happens in the meantime? If I were a currently registered or unregistered practitioner and I put my application into the CTSI, would I not then be able to trade until such time as I had my registration, or is there a grace period through which I could continue to operate until the CTSI had sufficient resources to deal with my case? How does the conveyor belt work and will the CTSI have sufficient capacity to handle what will be a really heavy workload at the front, which will obviously then tail off?

The Minister talked about monitoring, which is an interesting concept. What is the CTSI? It is a group of people. How will they monitor these cases? What data will they use? How will they monitor the process? Will they require certain documentation from their registrants on a regular basis? Will a reregistration process be required after five years, three years or whatever? The monitoring is an important element, but it is not clear to me whether the CTSI has experience in any of this kind of process. It is not an organisation that I know and I do not wish to cast aspersions on it—I am not—but I wonder about it, because it is being thrust into a whole new set of operations.

Will there be a process that can be led, which puts together a register of what these businesses are and promotes that register so that people who are in dispute have somewhere to go? Frankly, if I was in dispute, I would not know off the top of my head that there was an ADR process or where to go to get sufficient help with it. Who has accountability for promoting the process and getting people to use it? Obviously, it is preferable to clogging up the courts with endless cases. As is often the case, in principle this is great but the practice is still a bit mysterious, so I would welcome some answers to those questions.

[Lord Sharpe of Epsom (Con)]

My Lords, I was not involved in the 2024 Act, so—to no doubt universal relief—I shall be very brief. As the Minister explained, the statutory instruments implement Chapter 4 of the Digital Markets, Competition and Consumers Act 2024, by replacing the voluntary accreditation system for alternative dispute resolution providers with a mandatory framework. It grants the Chartered Trading Standards Institute the powers necessary to accredit, monitor and, where necessary, sanction ADR providers and it introduces reporting requirements to ensure transparency and accountability.

I am interested in the answers that I am sure the Minister has ready for the noble Lord, Lord Fox, who raised some interesting practical points. I am also extremely interested to hear what a “durable medium” is.

[Lord Fox (LD)]

It is carved in stone.

[Lord Sharpe of Epsom (Con)]

Paper is not that durable in fire or water, so are we talking stone tablets, or vellum, perhaps? I am very curious to know the answer to the question from the noble Lord, Lord Stevenson.

Obviously, alternative dispute resolution plays an important role in enabling consumers to resolve disputes quickly and without recourse to the courts, so a clear and enforceable accreditation framework should strengthen confidence in that system. On that basis, His Majesty’s loyal Opposition are happy to support these instruments.

[Lord Stockwood (Lab)]

I thank noble Lords for their contributions to the debate. As I stated in opening, the purpose of these instruments is to place the UK’s ADR framework on a stronger footing and to provide a more effective service for consumers and businesses alike. This feeds into the broader work of the DMCCA to bring greater fairness to digital markets and to bolster consumer protections.

I will try to respond to the questions raised by noble Lords today. The most important question, raised by the noble Lords, Lord Stevenson and Lord Sharpe, was about durable mediums. I am reliably informed that this includes digital. We do not have to go as far as stone tablets, as the noble Lord, Lord Fox, suggested. The digital medium is included in that, so that is the acceptable format.

The noble Lord, Lord Stevenson, raised an important question around extra burdens on consumers. Accredited ADR providers can charge a fee only if provisions for doing so are agreed by the CTSI and published. The purpose is to limit fees that consumers may be charged, thereby incentivising the use of ADR. At the same time, this is intended to discourage frivolous claims. Those fees should be up front and should be clear. There is a balance to be struck between ensuring that consumers have adequate access to ADR and that the core costs of the service are covered. We hope that this addresses that balance.

The noble Lord, Lord Stevenson, also mentioned reviewing the regulations. The Government have no specific plans to conduct a post-implementation review of this instrument or the reforms to which it relates, but we will continue to monitor and evaluate the operation of the system of ADR accreditation under the 2024 Act and the provision of the quality of ADR carried out in the UK through the quarterly and annual reports that this instrument requires the CTSI to provide.

The noble Lord, Lord Fox, asked about the capacity of the CTSI, the number of practitioners, how many will have to reregister, the processes and the costs. Those currently registered will go through a light-touch process to transfer their original registration across to the new system. We recognise that this transition period will place some burden on the ADR providers and aim to minimise this. The transition period will be in the region of six months, when ADR providers can continue to operate without the accreditation. In part, this will ensure that current providers and cases can continue without disruption. It will also give the CTSI time to manage the transition. We recognise that this will cause some extra elements of burden, but this seems like the lightest-touch way of transitioning to the improved system.

The noble Lord, Lord Fox, also asked about the CTSI register and about promoting the process. The CTSI currently hosts a list of accredited providers on its website. This will be maintained under the new regime so will remain in place. On the question about how the CTSI is monitored, it is required to provide reports to the DBT SoS on a quarterly and an annual basis. We hope that will be sufficient, but we will be happy to review that if it proves not to be an adequate way of keeping an eye on how things are going.

To conclude, I am grateful for the Committee’s support for this instrument. I beg to move.

[Lord Fox (LD)]

Before the Minister sits down, perhaps he could take this away: simply putting something up on the website—the “If we build it, they will come” approach—is probably not the best way for consumers to know that they have this service. You have to know it exists before you can find it. I suggest that the Minister takes away and discusses with the CTSI and others whether there is some sort of consumer marketing process that can follow once the capacity for ADR is there, so that people actually know it exists. I suspect that nobody knows the organisation exists—or very few people do—and certainly very few people know that ADR is a service on which they can call.

[Lord Stockwood (Lab)]

The noble Lord makes a really important point. Let me take that away and consult with the team and I will come back to him with a response on that.

US Tariffs

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Monday 23rd February 2026 Lords Chamber

[Lord Stockwood (Lab)]

As a Minister only six months into the job, I have uncertainty in my own mind sometimes; I am certainly not going to comment on the US President. What I can say is that we remain the only country that has secured a 10% tariff on auto, securing hundreds of thousands of jobs; we are the only country in the world with a 0% tariff on pharmaceuticals; and we are the only country in the world to benefit from a 25% tariff on steel, aluminium and other derivatives. We believe that we will retain those competitive positions, but our position is to control the controllables that we have today and negotiate to retain those benefits for UK businesses.

[Lord Fox (LD)]

My Lords, I am sure that industry is grateful for the sympathy the Minister has expressed from the Dispatch Box, and we are all encouraged by the hopes that the Government have expressed. But we all know that the opinions of trade officials often differ from those of the President. The uncertainty that is now surrounding all of British manufacturing is huge. What advice are the Government now giving to manufacturing businesses? What conversations have been had with the manufacturers, and how should they behave in the light of this huge uncertainty?

[Lord Stockwood (Lab)]

The question of certainty, raised by the noble Lords, Lord Lamont and Lord Fox, is critical to business. We live in a world that is changing rapidly and evolving minute by minute—I just checked my BBC feed on my way into the Chamber this afternoon. What I can say is that this Government have a plan: for the first time since the 1960s, we have an industrial strategy that focuses on our competitive advantage in automotive, technology and pharmaceuticals. It remains important to have clarity on our comparative advantage, and we remain in negotiation with all those key sectors; indeed, the pharmaceutical sector has the most preferential deal globally. I was due to have a meeting at 3 pm today with the pharmaceutical sector, and this has overridden that. These are fast-moving events. We remain cool-headed, trying to negotiate on behalf of UK businesses, and we are confident that our preferential relationship with the US will bear dividends as things develop this week.

Land Covenants: Supermarket Chains

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Wednesday 4th February 2026 Lords Chamber

[Lord Stockwood (Lab)]

I am assuming from the noble Lord’s question that he does not have Aldi and Lidl advantage cards as well. Just to acknowledge, the CMA is currently doing its work, including on a consultation to get feedback on how Aldi and Lidl should be treated. We acknowledge that the argument for exemption does distort the market, but the independence of the CMA must be respected. I share the noble Lord’s views that it seems right on face value that Aldi and Lidl should be brought into that same regime.

[Lord Fox (LD)]

My Lords, as well as the issue of Aldi and Lidl, there is also the issue of almost complete non-compliance with the 2010 order system. The CMA has identified multiple repeated breaches across all of the seven majors, as mentioned by the noble Lord. So, in addition to having this system, it is entirely unenforceable because the CMA has no legal powers to fine on this issue. The whole thing is being brought into disrepute by the absence of any real enforcement. Can the Minister confirm that the digital markets Act gives powers that could be taken by the CMA to fine on this issue, and will that be one of the issues that the CMA will be reviewing?

[Lord Stockwood (Lab)]

The CMA has a broad primary and competition regulatory framework. It is equipped with the powers to investigate and to act against anti-competitive conduct. On the specific question about the digital Bill, I will have to consult with colleagues and come back to the noble Lord; I am not familiar with it.

UK Start-up Companies

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Wednesday 28th January 2026 Lords Chamber

[Baroness Lloyd of Effra (Lab)]

The UK has an extremely strong track record as a vibrant ecosystem for start-ups and scale-ups, and that is something the Government are committed to building on—hence, as I mentioned, the entrepreneurship package. Specifically on regulation, we are not sitting still on that either. We have announced, as part of our regulation action plan, a commitment to reduce the administrative burden on all businesses by 25%. We have already announced several specific measures to ease the regulatory burden for smaller companies. For example, we announced in October 2025 that we would exempt tens of thousands of companies from producing strategic and directors’ reports. We are looking carefully across all departments at how we can optimise regulation. In addition, through the Regulatory Innovation Office, we are looking at how to regulate new technologies that perhaps do not fit within the existing regulatory purview, such as drones or novel foods.

[Lord Fox (LD)]

My Lords, I am pleased to hear that the Government are going out and looking for evidence. I want to add another sector that has not really been mentioned here. From my meetings with businesses, there is a whole section of businesses—a large lump—with perhaps 100 employees, which are successful and are doing well, and are often family owned or privately owned, but they find it difficult to get the capital they need, not to turn themselves into unicorns but perhaps to double in size or get half the size again. Can the Minister take on board that sector? Can she discuss with colleagues how those firms can get access to the finance they need? That incremental growth would make a big difference to our economy.

[Baroness Lloyd of Effra (Lab)]

As noble Lords may know, we are supporting our public finance institutions. We are increasing the capitalisation of the British Business Bank, which can play a role in this area, complemented by the National Wealth Fund’s new mandate, which includes a focus on other sectors such as digital and technology. As the noble Lord is aware, we are also acting over the longer term, which may take a little longer, to increase the amount of capital that domestic pension funds can allocate to private assets, including through the Mansion House Accord and the Sterling 20 group, in order to continue to support businesses getting access to finance in the UK.

Hospitality Businesses

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Tuesday 27th January 2026 Lords Chamber

[Lord Stockwood (Lab)]

Business rate reform has been on the agenda for the last number of Parliaments and this Government have taken it on. Since I came into government six months ago, I have been proud that our overall objectives have been about stability in our economy, bringing down inflation—it is on target for next year—and making sure that consumers have more money that they can spend in the hospitality industry. Alongside that, the review of overall business rates and the commitment of £4.3 billion mean that over a third of businesses will pay no business rates, over half of ratepayers will see no increases and 23% will see their bills going down. This is funded by targeting those with higher rateable values. Overall, while the main thing is bringing stability to the economy and bringing inflation down to make sure that consumers are spending, reform of revaluation is increasingly important as well.

[Lord Fox (LD)]

My Lords, while, of course, there is a need for holistic reform of business rates—the Liberal Democrats have long proposed a commercial land- owner levy—in the short term, just as the noble Lord, Lord Sharpe, suggested, reducing the retail, hospitality and leisure multiplier by 20p, as opposed to the Government’s 5p, would make a big difference. The whole retail and high street sector has been hit by this—not just pubs or hospitality—so does the Minister recognise that the current proposals, while welcome, are too small and narrow to help our high streets?

[Lord Stockwood (Lab)]

I clearly acknowledge that there are challenges in the economy that are not of the making of the last 18 months alone. Changing consumer behaviours post Covid are a challenge for our overall economy. However, to restate what I said before, we need to get the economy back on track overall and ensure that we have fiscal responsibility. This package alone will cost us £4.3 billion. The additional announcements today on pubs and live music venues take that even further. On average, that relief will be more than £1,600 per pub. We have to do all that while balancing the overall needs of the economy with fiscal responsibility, which the Government set out as major proposals.

Employment Rights Bill

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Consideration of Commons amendments and / or reasons
Tuesday 16th December 2025 Lords Chamber

[Lord Vaux of Harrowden (CB)]

My Lords, at Second Reading in March—nine months ago, although it feels longer ago—I said that

“the Bill will damage growth and, most importantly, the employment opportunities of the most vulnerable people”.—[Official Report, 27/3/25; col. 1907.]

After nine months of debate and scrutiny, it is less damaging, but I still believe it is not a good Bill. It still piles cost and regulation on businesses and on the public sector at a time when we should be doing exactly the opposite.

But this House has done its job well and responsibly. We have pointed out the unintended consequences that the Bill may have, the potential damage to the employment prospects of the young and others, and the disproportionate impact on the backbone of our economy—smaller businesses. We have given the other place several opportunities to think again and, to be fair, it has done so in a number of areas. In particular, the Government have compromised on what I believe was the most damaging aspect, day-one dismissal rights.

We have also quite rightly registered our constitutional disapproval of the introduction of a material change at the very last minute—the abolition of the cap on unfair dismissal, which is the subject of Motion A. The Minister stated last week that the amendments were “context- and Bill-specific”. I take this and her reference to

“discussions with the Leader of the House on how she and other Members would like to conduct business more regularly”—[Official Report, 10/12/25; col. 276.]

as confirmation that the Government accept that this should never be seen as a precedent. This House would be right to reject it if it were ever used as a precedent in the future.

I have a lot of sympathy with the Motion proposed by the noble Lord, Lord Sharpe, but I am afraid I will not support it at this stage. We are in danger of over- egging the impact of the removal of the cap. I do not support it, but the water bosses, for example, will be remunerated if they are fired for contractual reasons, which is unlimited anyway. It is not going to be under the unfair dismissal rules. I am not convinced that it makes an enormous difference, but the noble Lord is quite right that we do not have an impact assessment yet.

Despite our giving it the opportunity to think again on many aspects, the other place has disagreed with our changes and decided that it wants to go ahead. That now also includes the cap on unfair dismissal claims. The time has come for us in this House to respect the will of the elected Chamber and let the Bill pass, regardless of any remaining concerns that I and many others still have. I will vote against the amendment for that reason.

I end with a final plea to the Minister. She will be aware of the latest employment figures and the worsening trend. She will also be aware that what the ONS described as this “subdued labour market” is disproportionately affecting young people. We should all be very concerned about that. The Resolution Foundation is also clear on this:

“As is typical in economic downturns, young people have been hit hardest. With unemployment expected to stay elevated, Government should be cautious about any further increases in labour costs”.


Much of the implementation of this Bill will be by regulation, which will follow over the coming years. I urge the Minister to ensure that the concerns that have been raised in this House and elsewhere are kept front and centre, and that the unintended consequences that may arise, especially for young people, are thought through very carefully while the regulations are being created.

It was encouraging that the Government listened to business organisations in the later stages of the Bill, especially around the unfair dismissal question. I urge the Minister to ensure that the Government continue to listen constructively to the concerns of those who will create the growth and jobs that will drive the economy, and especially that they make a much greater effort to hear the concerns of smaller businesses which are feeling rather ignored and concerned at the moment. That said, it is time to let the Bill pass.

[Lord Fox (LD)]

My Lords, this time last week I said that much had happened in the preceding interval. Today, the opposite is true. We are now down to one issue, but the arguments on that issue remain as they were last week. For that reason, unlike last week, this speech will be short.

There remain concerns about the removal of the cap on compensation, as we have heard. As he did last week, the noble Lord, Lord Sharpe, has taken those concerns and amplified them, to the seeming exclusion of the wider strategic position of what we are discussing. I understand the motives, and those motives became ever clearer just now. If the noble Lord would like to have a face-off on the water industry, I would be very happy to discuss with him the hundreds of thousands of tonnes of sewage that went into the rivers under the Conservative Government and the compensation terms that he very helpfully enumerated, which happened on his watch. However, this is not the arena for that argument, and I will pass without comment. My critique of the noble Lord’s amendment to the Motion is unchanged. We believe there are better ways of dealing with the cap than derailing the package that got the key concession with which we are all very pleased.

As set out last week, reiterated in the Minister’s letter and by the Minister just now, the Government will publish an enactment impact assessment for the Bill. They will do so prior to commencement regulations which would put in place the dismissal package. That was what we on these Benches were asking for and we were pleased to receive that assurance. Further, the impact assessment will be publicly available, and I was pleased to hear the Minister say that we will be engaging the community of business in the process of developing that impact assessment.

Many UK business associations and organisations share the feeling that there is nothing to be gained from the opposition amendment today. They are asking the opposite. As the Minister set out, six of the major organisations have sent a letter. It is a longish letter, as the noble Lord, Lord Sharpe, demonstrated by selectively picking elements out of it. But as the noble Lord, Lord Pannick, pointed out, the conclusion is clear and actually unambiguous, in saying,

“we believe that the best way forward is to keep working with the government and trade unions to find balanced solutions through secondary legislation. To avoid losing the 6 months qualifying period, we therefore believe that now is the time for Parliament to pass the Bill”.

I said that last week, and it is truer this week.

I also pointed out last week that, as the business organisations said, the key to enacting the Bill will be through secondary legislation. If His Majesty’s loyal Opposition care about how the Bill is brought into life, it is on those statutory instruments that they should focus their attention. Their critical actions must extend to include the possibility of fatal Motions to vote down secondary legislation and keep the Government focused on the needs of British business. That is the real arena that we should be working in.

If the amendment from the noble Lord, Lord Sharpe, is put to a vote and he seeks to extend ping-pong to yet another round, that will clearly be against the advice of the business groups which have been cited. I urge your Lordships to heed the advice of those organisations, and the advice of the noble Lords that we have heard opposite, and pass the Bill now.

[Baroness Lloyd of Effra (Lab)]

My Lords, I again thank your Lordships’ House for its attentive scrutiny throughout the passage of the Bill. There can be no doubt, as the noble Lord, Lord Vaux, mentioned, that this House has discharged its duties as a revising Chamber. Your Lordships’ House asked the Government to look again, and we have worked collaboratively with noble Lords to reach this agreement. I thank the noble Lords, Lord Fox, Lord Pannick and Lord Vaux, for their speeches in favour of the compromise proposed by the Government.

I turn to a number of the issues raised, in particular by the noble Lord, Lord Sharpe. I remind noble Lords that negotiations are successful only where there is compromise, as was so eloquently put in the previous debate by my noble friend Lord Barber of Ainsdale, the former chair of ACAS. The Government and worker representatives moved considerably during negotiations to agree to retaining a six-month qualifying period. Without similar compromise from business representatives on the removal, this deal would have been one-sided and undeliverable.

On the question of the impact of the cap, I do not think I can do better than the noble Lord, Lord Pannick, who said last week that

“the concerns that have been expressed about the impact of the removal of the cap are perhaps … exaggerated”.—[Official Report, 10/12/25; col. 276.]

Just now, he mentioned that he does not believe it will lead to the chaos that the noble Lord outlined earlier. It is not our view, but, in any case, as I mentioned, we will publish the enactment impact assessment as soon as the Bill achieves Royal Assent. It will be public and transparent, and will include an assessment of the impact of removing the compensation cap.

I remind noble Lords of our commitment to convene meetings with shareholders so that those from the City, law practitioners and others can feed into that. Those findings will be taken into account by the dispute resolution task force that we are setting up—it will have all that information to hand. We are obviously very keen to improve the functioning of the dispute resolution system. We inherited something that was not in a good state. We are providing ACAS with over £65 million in resource funding, which is a significant increase. We are working actively to make this a system that works extremely well.

I hope that this afternoon will mark the end of the Bill’s journey through Parliament. I reiterate the Government’s commitment, mentioned by other noble Lords who spoke today, to continue talking to and genuinely engaging with interested parties in the way we have recently about the full range of issues discussed today. The Bill will deliver a generational shift in employment rights. It will do so by working with businesses and trade unions in a collaborative manner. These changes to the qualifying period and the compensation cap are proportional and practical. For those who are concerned about business impact, the joint letter should provide noble Lords with reassurances that businesses support this workable agreement. As they have stated,

“now is the time for Parliament to pass the Bill”.

I hope noble Lords will recognise the progress made over the past nine months, oppose the amendment tabled by the Opposition Front Bench, and, in doing so, support the package to deliver certainty for businesses and fair rights for workers. It is indeed time for Parliament to pass the Bill. I commend it to the House.

Employment Rights Bill

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Consideration of Commons amendments and / or reasons
Wednesday 10th December 2025 Lords Chamber

Moved by

[Lord Fox]

Leave out from “disagreement;” to end and insert “do disagree with the Commons in their Amendments 1E and 1F in lieu of Lords Amendment 1B; and do propose Amendments 1G and 1H in lieu of Commons Amendments 1E and 1F—

1G: Clause 1, page 3, line 24, at end insert “and that period must be not less than 26 weeks”

1H: Schedule 1, page 153, line 13, at end insert “and that period must be not less than 26 weeks””

[Lord Fox (LD)]

My Lords, similarly to the Minister, I beg the House’s indulgence because, if this speech is longer than a speech would normally be for round three of ping-pong, it is because, as she pointed out, there have been developments since we last debated the Bill.

My Motion A1 addresses a major issue that has caused us concern. As I have said repeatedly, we support the principle that workers should have a right to guaranteed hours after completing a period of zero-hours work. Our concern has always lain in the cumbersome administration of that right. After several attempts to make what I think were meaningful improvements without undermining that principle, I must admit I have felt quite frustrated on this issue.

However, as we heard just now from the Minister, it is reassuring that the Government have taken these concerns on board. As she partially explained, the reference period is crucial in setting how often the employer must make a new offer of guaranteed hours to an employee. I point out that the employee does not necessarily have to want that offer; there is merely an obligation on the employer to make it. Clearly, if this offer has to be made every month, it is much more burdensome than if it has to be made once or twice a year. That is the nature of the amendment that I have tabled.

I understand that this is subject to consultation, and I am reassured by the description of the consultation that the Minister has just given. My choice of 26 weeks was, first of all, in a sense, to emphasise the point between a month, 26 weeks or 12 months, but also to spark the sort of response that I have just had from the Minister. In that respect, I am satisfied.

A joint press release issued after the negotiations by the business organisations noted:

“We remain committed to working with government and unions to dealing with this in the necessary secondary legislation to implement the Bill. We must ensure that it supports opportunity for workers while avoiding damage to economic growth”.


We subscribe to that view, and I think the Minister gave her support to the nature of the consultation that will follow.

I will now move on to the unfair dismissal issue. As we heard, the government amendment in lieu creates a six-month qualifying period for workers’ rights. It also, crucially, removes the section that would have enabled secondary legislation to alter that qualifying period. That was good news. It will therefore come as no surprise that we welcome this compromise. It represents success for the tripartite discussions that led to its breakthrough, and all three parties should be commended for the good faith that they brought to that meeting.

The Bill’s previous position on day-one rights would have significantly held back the employment prospects of anyone who would have represented the slightest risk to an employer. This avoids that risk. As the British Chambers of Commerce, the Chartered Institute of Personnel and Development, the Confederation of British Industry, the Federation of Small Businesses, the Recruitment & Employment Confederation and Small Business Britain put it in their press release that heralded this deal:

“This agreement keeps a qualifying period that is simple, meaningful, and understood within existing legislation. It is crucial for business confidence to hire and to support employment, at the same time as protecting workers”.


That is a strong endorsement from the employment side for this part of the deal.

I feel sure that one factor that helped concentrate minds during negotiations was the need to meet a deadline. If the Bill does not gain Royal Assent by the end of the year, key benefits that we have discussed, and that many of us support, to be created by the Bill will not be enacted for workers across the country for a further year. I feel proud of those on our Benches who helped create the pressure and who held firm while that decision was in the making. I thank my Liberal Democrat colleagues for turning up, every time, to help the Government, alongside the other two parties, come to the compromise that we now have. It is a credit to this side of the House and the rest of the House.

I move to Motion B1, in the name of the noble Lord, Lord Sharpe. As well as containing good news on day-one rights, the government amendment in lieu contained a surprise, or a surprise to us. It is clear that removing the compensation cap for unfair dismissal has generated unease since the amendment was tabled. This is not something your Lordships have discussed. As we heard, it was discussed during the tripartite negotiations, but there has been some confusion. I suggest that the ambiguity of the word “lift” has contributed to this in no small measure: “lift” can mean both remove and increase, and I suspect there may have been some confusion.

Some employers, while welcoming the shift from day-one rights to a six-month qualifying period, have expressed concern about the possible implications of potentially unlimited financial exposure. Your Lordships should note that, as the Minister said, the average unfair dismissal award for the year 2023-24 was under £7,000, with a ceiling of more than £118,000. Clearly, the cap did not influence the awards being made. I asked the Minister to confirm—and she has—that the criteria that are used to set the award are not changed by the contents of this Bill. This being the case, it seems that the main beneficiaries of this change will be those who earn considerably more than the average wage in this country. It will be those who are paid more, but, in my anecdotal experience, the very highest paid rarely use employment tribunals; their deals are set in boardrooms, usually with NDAs. I genuinely do not believe that SMEs will be disadvantaged by this. However, I think we can all agree that the process was poor.

In my discussions with the Government, I pressed for a meaningful impact assessment. We have just heard the Minister confirm that there will be consultation and a meaningful impact assessment that will be published. This will be completed and published before the clause that lifts the cap is enacted, so if something really bad comes out of that IA then there will be time to act on it. After that, as the Minister noted, ongoing monitoring of the effects of these changes will be essential, and corrective action should and must be taken if negative trends emerge. In any case, I remain unconvinced that Motion B1 would provide the analytic value that we would get from a proper impact assessment. Even in the event that I was supporting the noble Lord, I do not think the route that he seeks to take is one that would be of benefit. It seems more symbolic than meaningful.

--- Later in debate ---

[Baroness Lloyd of Effra (Lab)]

I emphasise again that the Government’s convening of recent discussions and our willingness to compromise on the issue of unfair dismissal should signal to parliamentarians and stakeholders that we want to get this right. I emphasise that the Government’s work on this agenda is far from over. There will be opportunities for further debate and scrutiny, and I look forward to these discussions. I therefore hope that noble Lords will join business representatives and trade unions in supporting the position reached in recent discussions and backing the Government’s Motions today.

[Lord Fox (LD)]

My Lords, there was a moment when I was engulfed in shame that I had misunderstood the difference between median and average. Fortunately, the noble Lord, Lord Hendy, distracted your Lordships quite quickly, so I have recovered.

Nobody in this House is pretending that this is perfect. We are at a point of pragmatism and, I remind your Lordships, at the third round of ping-pong. The noble Lord, Lord Vaux, has made some important points. All of us go into this. If it was perfect, I would press Motion A1 and I would want to keep on iterating. I know that now is the time for this Bill to pass. Therefore, I beg leave to withdraw Motion A1.

Motion A1 (as an amendment to Motion A) withdrawn.

ExxonMobil: Mossmorran

Lord Fox Excerpts

Monday 24th November 2025 Lords Chamber

[Lord Sharpe of Epsom (Con)]

My Lords, His Majesty’s Official Opposition’s thoughts are with the 450 workers at Exxon Mobil’s Fife plant, who now face losing their livelihoods. That plant had been a cornerstone of chemical production in the United Kingdom for 40 years. These are skilled people—proud people—and whole communities are now wondering what comes next. They deserve our sympathy, of course, but sympathy will not keep an industry alive. This closure was not unavoidable; it is happening because of this Government’s policies.

The chief executive of the Society of Chemical Industry, Sharon Todd, put it starkly:

“Without further government action to address high energy costs for industry, and a greater consideration of the importance of fossil carbon for material feedstocks, industrial resilience in the UK is undermined and further closures are increasingly likely”.


What a verdict—and it is one that the Government cannot pretend they have not heard. We on these Benches have warned Ministers repeatedly. Industry has warned them repeatedly. Everyone who actually makes things in this country has warned them repeatedly.

But the Government simply will not listen, and the price of this stubbornness is being paid by workers, manufacturers and communities up and down the country. ExxonMobil is not alone; we are seeing exactly the same story in steel. Everywhere you look, energy-intensive industries are struggling with the same crushing energy costs, and the pattern is not subtle. The Government’s energy policy is pulling in the opposite direction to its supposed number one priority of growth. You cannot claim to have a plan for growth while presiding over some of the highest electricity prices in Europe. It just does not add up.

Only a few weeks ago, the US ambassador to the UK, Warren Stephens, warned Ministers that high electricity prices are deterring investment from the world’s strongest economy and our closest ally historically. Then we have ExxonMobil’s UK chairman, Paul Greenwood, who said that the company had spent months warning the Government about the risks to the plant, only to be ignored. He said that

“these are deliberate Government policies that are undermining us”.

When global companies start talking like that, something is seriously wrong.

This closure lands at the same moment that Make UK published a report warning that surging energy costs and cumulative taxes are threatening the future of Britain’s industrial base. Ministers have no excuses left. These are the results of decisions made in Whitehall: a slow-motion sustained act of industrial self-harm. Even Unite and GMB—hardly allies of these Benches—warned Ministers that their ban on new oil and gas development would devastate supply chains and destroy skilled jobs. When both employers and unions are saying the same thing, it seems that only this Government could fail to hear it.

And what exactly has this achieved for the environment? Nothing, because now we simply import more oil and gas instead of producing it ourselves. Meanwhile, the Minister in the other place, the Secretary of State for Net Zero, posts on X claiming that bills remain high due to fossil fuel dependence, yet Ofgem has confirmed that policy costs are the major driver.

Minister can no longer hide from the consequences of their own decisions. We have major international investors describing the UK as “mismanaged” and “uninvestable”. South Africa’s richest woman called Britain a “scary country”, saying that she

“wouldn’t touch it with a barge pole”.

When global investors are talking about the UK in those terms, something has gone profoundly wrong.

As we said during the steel debate a few weeks ago, high energy costs and new unemployment burdens looming from the Employment Rights Bill, plus scatter-brained and ideological policies coming out of DESNZ, are all squeezing the life out of British industry. Will the Government reverse their ban on North Sea oil and gas? Will they stop pouring unaffordable subsidies into wind and solar while heavy industry collapses under the weight of energy costs, or are they determined to preside over a full-scale de-industrialisation? British workers, British industries and British communities deserve a lot better than this; they deserve a Government who listen, support industry and understand growth, and the Government are failing on all three counts.

[Lord Fox (LD)]

My Lords, this is quite clearly a blow for the area of Fife, and especially for the direct and indirect workers of the plant. Just as the noble Lord, Lord Sharpe, said, our thoughts go to them and their families as they seek to find ways of coming to terms with the blow.

The closure will see many highly qualified and specialised workers laid off at a time of severe cost of living pressures. The company has talked about supporting its employers and possible relocation available for some, but what about contractors and the wider supply chain? As far as I am aware, no task force has yet been set up to manage this, so can the Minister please update your Lordships’ House on how the wider workforce will be helped as this crisis bites? It is reported that only around 50 staff are being offered jobs, and nearly 500 miles away in Hampshire. Can the Minister confirm how many have actually agreed to relocate? What are the Government doing to protect and create highly skilled, high-quality jobs located for those who cannot move far from their homes, their communities and their wider family? More generally, much is made of the transition to net zero, which we wholeheartedly support, but there is a danger of the old jobs disappearing more quickly than the new ones are being created, and this mismatch will make growth very difficult, if not impossible.

There has, not unexpectedly, been some finger-pointing—indeed, we just saw some—trying to work out who is to blame for this. But we should understand that this plant has been in trouble and making a loss for five years. If economic and trading environments are causing the closure, both this Government and the last Government are culpable. But I also point to Brexit. All the products made at Mossmorran are exported to the EU. Can the Minister outline how much Brexit contributed to the plant’s demise? Given that there will no longer be these exports from the plant, what is the effect on our balance of trade?

This is, of course, a further blow for the Scottish economy and UK-wide manufacturing, and it comes fast on the heels of other company closures. The common denominator seems to be a combination of long-standing depressed demand alongside the policy environment—and the overwhelming issue, as noted by the noble Lord, Lord Sharpe, is the cost of energy. Energy was a problem when the noble Lord was in government and it remains a problem now. This is not to downplay today’s news confirming the £420 million a year committed to reduce electricity costs for the UK’s most energy-intensive industries—but that is jam tomorrow; it does not start until 2027.

There is a desperate need for further and more rapid intervention, as many UK chemicals operations face risk of closure before the British industrial competitiveness scheme, as it is called, comes into effect the year after next. There also remains considerable uncertainty about which businesses will benefit from this new support. Can the Minister fill us in on what the process will be for deciding which businesses and sectors qualify for this subsidy? What specific steps are the Government taking for the here and now? We understand what is happening in 2027, and we have seen the long look into the future that is called the industrial strategy, but what is happening now? We need to find a way of making sure that there is long-term investment in our manufacturing and chemicals industry.

The Scottish Government have a responsibility for the economy and jobs in Scotland, so why is there no meaningful mention of them in the Statement? Will the Minister outline what conversations were being had with the Scottish Government and when, and how the Minister sees the role of the Scottish Government going forward?

To conclude, energy-intensive industries are in decline across the UK. Every chemical business across the UK is paying more for its energy than competitors elsewhere, as was the case under the noble Lord, Lord Sharpe, as much as 400% higher than in America. Closures at Grangemouth, Prax Lindsey and now Mossmorran risk forcing downstream operators to import resources at higher cost. Britain’s once dominant chemical industry is continuing to suffer. The UK’s chemical output has reached its lowest level for a decade. The latest business survey of members of the Chemical Industries Association shows that 60% of chemical businesses report falling sales with a further 20% seeing no growth. More worryingly, many report strategic reviews.

Closures reduce our already dwindling industrial capacity and reduce our ability to deliver essential materials for our country’s critical national infrastructure, be it health, energy, food or defence. If the Government want to continue to have a chemical industry, then we need much more action to address these unsustainable costs.

[The Parliamentary Under-Secretary of State, Department for Business and Trade and Department for Science, Information and Technology (Baroness Lloyd of Effra) (Lab)]

I thank the noble Lords for their statements today, and I entirely agree that our thoughts are with the workers and the families of those affected by the closure.

While this Government inherited a precarious economic position from the previous Administration, it is imperative that we continue to move forward and pursue the right pro-innovation, pro-business policies which generate growth. We were disappointed to learn of Exxon’s announcement of the closure of its Fife ethylene plant. This follows months of engagement with the company and a commitment to explore all the opportunities to retain the site’s operations. However, it is my understanding that there was no credible buyer for the plant. Of course, if there are potential purchasers who wish to explore what is possible, the Government would be happy to work with them. We would be happy to find a solution, whether that is the ongoing operation of the plant or repurposing the site for new uses.

As noble Lords will know, the Government and ExxonMobil have been discussing the operating environment around the plant since April, and officials endeavoured to meet Exxon every week since August. Last weekend, Ministers from across government were in contact with the company to discuss this decision, and I expect there will be further conversations over the coming months. The Minister for Industry was clear that the Government are prepared to step in and support industry where it is feasible to do so, as we did with Harland & Wolff, Tata Steel and most recently British Steel. Sadly, in this instance, the Government are not able to provide support without a fundamentally sound business proposition. No intervention would represent value for money without one.

We know that it is a concerning time for those affected, which is why our focus is now on supporting the workforce. The Minister for Industry met Unite to explore options for supporting the affected employees, and Exxon is taking steps to mitigate the impact of its closure decision, as any responsible company would, with some employees being retained to support the decommissioning of the site and others being offered relocation and training packages to Exxon’s other assets at Fawley and Southampton. Discussions about the precise allocation of those roles are ongoing and I cannot confirm at this time exactly how many people have decided to make the transition to other sites. Regrettably, this falls short of supporting the entire workforce in finding new employment, which is why the Department for Work and Pensions is engaged in supporting those impacted. Officials in the department are also in contact with representatives from Fife Council and the Scottish Government and are working together on a task force to provide further support. Today, my right honourable friend the Secretary of State for Scotland met the Scottish Government and the Fife local authority to convene the first of those discussions and will continue with that task force over the coming months.

I stress that this closure is not representative of UK industry as a whole. Through our modern industrial strategy, we are channelling support to the eight growth sectors of the economy, including clean energy, defence and advanced manufacturing—all areas in which Scotland is incredibly strong. Far from being uninvestable, since July, we have seen more than £250 billion of investment committed into the UK, alongside 450,000 jobs. Only recently, we have seen further investment into AI growth zones and small modular reactors.

Both noble Lords talked about energy costs. Your Lordships know that bringing down energy costs for British businesses is a key part of our industrial strategy. Although it is important to note that electricity costs were not a major factor behind this site’s closure, we are pressing ahead with unprecedented support for our energy-intensive industries so that they can properly compete and win in the global economy. Last month, we pledged to increase the discount on electricity network charges from 60% to 90% for businesses in sectors such as steel, cement, glass and chemicals; this discount will slash costs for a whole host of businesses not just in England but across the UK. We know that around 550 of our most energy-intensive businesses will save up to £420 million a year on their electricity bills from next April thanks to this one change.

To that end, our new British industrial competitiveness scheme, announced for consultation today, will reduce electricity costs for more than 7,000 eligible manufacturing businesses. We want to save them up to £40 per megawatt hour, or up to 25%, from April 2027; that will cover the foundational and frontier areas, as defined in the industrial strategy. This will be subject to further consultation, as set out in the papers today.

On the point about engaging and working with the devolved Governments, the Scottish Government have been heavily involved in the ExxonMobil discussions, with meetings at the highest level. I thank my colleagues, both there and in the UK Government, who have been engaging on this issue for such a long time and trying to find a way forward. We will continue to work constructively together both to support the hard-working employees of the Fife plant and to ensure that they are fully supported over the coming weeks and months.

--- Later in debate ---

[Baroness Lloyd of Effra (Lab)]

Yes, I am quite happy to write as a follow-up. I think I said £250 billion, and I originally meant to say 45,000 jobs. I apologise; that was my error—but I can follow up on that point.

[Lord Fox (LD)]

Just to prolong the agony for slightly longer, when the Minister was answering the noble Lord’s question on oil and gas, she came up with a long list of very creditable investments and changes that are going on. When I was asking my question, I referred to the relative speed of creating jobs versus losing them. Does she accept that it is much easier and quicker to lose jobs than to create them? It is very important that this creative process keeps pace with the destruction process, otherwise we will lose even more skills than we are already.

[Baroness Lloyd of Effra (Lab)]

It is indeed very important that we continue to create jobs in highly productive, well-paid sectors, and that we provide the skills and training to a broad base of young and older people to take advantage of that. Whether that is through large, single-site companies or through the plethora of SMEs that can create jobs, it is important that we continue to focus on the productivity of our economy, so I agree with that point.

Employment Rights Bill

Lord Fox Excerpts

Consideration of Commons amendments and / or reasons
Monday 17th November 2025 Lords Chamber

Moved by

[Lord Fox]

Leave out from “House” to end and insert “do insist on its Amendment 1B.”

[Lord Fox (LD)]

I thank the Deputy Speaker for his expert guidance. Your Lordships could be excused for a sense of déjà vu, perhaps because we are back in your Lordships’ House with the same issues we discussed on 28 October. They remain unresolved and, indeed, not addressed in any meaningful way.

Since the last very similar session of ping-pong, I have had an engaging meeting with the Lords Ministers and their officials, and I thank them for that meeting. The prospect of that meeting gave me a sense of anticipation. I expected some sort of legislative rabbit to be pulled out of the Government’s hat at that point, but no—there was nothing. At first, I thought something substantive was being concealed for tactical reasons, perhaps ready to be flourished in some dramatic prestige at the moment that pleased the Ministers. But it has become increasingly clear that not only is there no rabbit in the care of the Benches opposite but there is actually no hat. If there is a hat, it exists elsewhere, and for that I have some sympathy for the Ministers opposite, because they sit bare-headed at the moment, with nothing to offer.

Time has passed, however, and, if the Government’s position has not changed, what has? Well, the business environment has got worse. September saw negative growth in GDP, per capita productivity fell in the last quarter and unemployment rose to 5% as recruitment cooled. Yet this ping-pong represents a doubling down—but for what? The Government’s manifesto vowed to “make work pay”, and we agree with that. None of these amendments confound this. My Motion A1 does not in any way dent the worker’s right to convert zero hours to guaranteed hours. What it does is streamline the administration of that right. I explained last time that Motion A1 merely avoids unnecessary work, helping SMEs that have limited administrative capacity to get on with focusing on growing their business and, hopefully, creating more jobs. But, in the absence of an amendment in lieu today, I will insist on this.

Moving on to the amendment of the noble Lord, Lord Sharpe—Motion C1—we have consistently raised concerns about seasonal work. I welcome the Minister’s careful description of the issues in the current legislation—the problem being, of course, that there is outstanding consultation and outstanding details that make it difficult. We are not 100% happy with the noble Lord’s drafting, but we feel that it is a starting point for further conversations of the nature the Minister just brought up. We will support Motion C1 if it is voted on. Sorting the impasse on these Motions and those in subsequent groups requires political gumption. In the end, I suppose it will be up to No. 10—I understand that it might be preoccupied with other issues at the moment.

I close with one last statistic, this time from the Work Foundation at Lancaster University. There are now 1.79 million people out of work and looking for a job. With economic inactivity stable at a staggering 21%, the number out of work appears to be rising not due to increasing inflow but rather due to limited outflow caused by difficulties in finding work. That is 1.79 million people. The Government did not address the arguments we put two weeks ago, and therefore they deserve the same response as last time. I beg to move Motion A1.

[Lord Leigh of Hurley (Con)]

My Lords, as the noble Lord, Lord Fox, said, here we are, back again.

In the ping-pong debate last time, the noble Baroness, Lady Lloyd of Effra, stated:

“The Government have engaged extensively with stakeholders on their make work pay reform since August 2024. A major part of this engagement has been to seek the varied views of SMEs. As of 15 October, we had engaged directly with more than 250 stakeholders. This included 139 businesses, of which 75 were SMEs. This approach to engagement will remain throughout the various consultations”.—[Official Report, 28/10/25; col. 1246.]

--- Later in debate ---

[Baroness Lloyd of Effra (Lab)]

Of course, we have had many discussions and there have been amendments during the passage of the Bill as a result of some of the consultation we have had with all social partners. We made amendments to the Bill on Report in respect of fire and rehire and the school support staff negotiating body—all sorts of changes or amendments have been made through the consultation process. We have also set out a clear plan for implementation, so that each milestone is there and there is a consultation before that, so that all businesses, large and small, can have the right amount of time to prepare and to get the guidance they need to implement these measures.

[Lord Fox (LD)]

My Lords, I thank the Minister for her response. I very much welcome the objective that she set out of reducing red tape. I remind her that the Bill contains 170 statutory instruments. In my experience, every statutory instrument leads to at least one regulation, so perhaps when next she stands up, she can commit to retiring at least one regulation, if not two, for each one that the statutory instruments bring in on the tail of the Bill, if indeed it ever becomes an Act.

The Minister also talked about a moral duty in respect of zero hours. I share that moral duty. Nothing in Motion A1 resiles from that moral duty, and on that basis, I would like to test the will of the House.

--- Later in debate ---

[Lord Vaux of Harrowden (CB)]

My Lords, I want to speak to Motion B1. Like, I think, many noble Lords, I start to become a bit uncomfortable when we have multiple rounds of ping-pong; and I generally hesitate to vote against the Government in more than one round, but I am expecting to make an exception in this case, for four main reasons.

First, I firmly believe that introducing day-one unfair dismissal rights will cause real and permanent harm to young people and others who are seen as higher-risk hires, such as those who have been on benefits for a long period, ex-offenders and people who have had long career breaks, perhaps because of parental or other caring obligations. When I say permanent, I mean that; if you are unemployed for a year, it becomes considerably more difficult to get on to that ladder and to make a success of your career. This is really important.

I am supported in that belief by every business group. The noble Lord, Lord Sharpe, has listed many such groups; I would add another: the Institute of Chartered Accountants in England and Wales, of which I am a member. There is the Resolution Foundation, the Tony Blair Institute, and perhaps most importantly, the Government’s own impact assessment, which is very clear on this. I would love to hear the Minister’s views on his own impact assessment—he has never actually addressed that point. None of the several Ministers in this place or the other place has made any coherent argument to the contrary. So I put the question very simply to the Minister: will restricting the reasons that may be used to dismiss someone during a probation period, and thereby opening up the risk of an employment tribunal from day one, make it more or less likely that an employer, especially a smaller employer, will take a risk on, or give a chance to, a young person with no experience? Is it more or less likely? It is very simple. I think most of us know the answer to that. Is he going to argue that his own impact assessment is wrong?

Secondly, this measure directly contradicts other government policy. The Government’s youth guarantee, something I am strongly in favour of, will offer every eligible young person who has been on universal credit for 18 months guaranteed paid work. To do that, you need employers who are willing to give them a job and to take that risk. Why would an employer do that if they can be taken to the employment tribunal from day one if the employment does not work out? It does not make sense.

Thirdly, despite, frankly, the clear harm that this will do, the Government have not provided any evidence that the change will create any material tangible benefits for workers. No evidence has been provided to show that the qualifying period is being abused or is causing actual harm. There is no evidence provided in the impact assessment; there is evidence that doing this will cause harm, but none about the harm we are trying to solve. No evidence has been provided in this or the other place.

The Resolution Foundation is also very clear: if we are going to harm the life chances of young people, which is what the Government confirm in their impact assessment, we must have real evidence that there is a genuine greater benefit, not just the usual statement that it cannot be right that someone can ever be dismissed for no reason.

Fourthly and finally, I want to look more closely at the claim that this is a manifesto commitment. It is in the manifesto, but it is part of a wider commitment that includes the explicit commitment:

“We will consult fully with businesses, workers, and civil society on how to put our plans into practice before legislation is passed”.


We have heard several times today that the Government will consult afterwards. They might argue that that is because the rules for the probationary period will be in a statutory instrument.

Let us unpick this light-touch probationary period the Government are talking about. The problem is that the Bill expressly and specifically sets out the reasons why someone can be dismissed from day one during that probationary period, meaning that it is not genuinely a probationary period. Under the Bill, it cannot become a light-touch probationary period; that is simply impossible, given the way the Bill is drafted. I would love to understand more about the light-touch probationary period because we have had no detail about what it really means. However, the employer is obligated by the Bill—the Act, should that come to pass—to give specific reasons which are limited by the Bill. It cannot be light-touch, so I would like to understand better what the Government mean by that.

There is a possible way forward, however, which is where I start, perhaps, to part company with the Opposition. It is because the Bill sets out that there have to be specific reasons for dismissal that is the problem—that is what allows the employment tribunal to get involved during a probationary period and all the rest of it. I wonder—I am thinking aloud—whether there is a solution to the problem by taking that element out.

For those reasons, I am inclined to support the Opposition on Motion B1. I urge the Minister to take this seriously. As the Resolution Foundation put it so well, let us not

“needlessly put employers off hiring”.

[Lord Fox (LD)]

My Lords, we have heard four very good speeches, and I do not intend to repeat them. I listened very carefully to the Minister and, unusually, I will read what he said in Hansard rather than just saying I will, because there was some interesting stuff there. I picked out the phrase, “We will not compromise on the fundamental principles of the Bill”. It would help if those could be set out because they are currently in the eye of the beholder.

The Minister also raised the notion that someone who had worked just less than two years should not be unfairly dismissed. The amendment of the noble Lord, Lord Sharpe, recognises that point fundamentally but there are 730 days between day one and two years. We do not have to go from 730 to one; there are stages. We may disagree on that.

The noble Lord, Lord Vaux, pulled out the issue of light-touch rules and the criteria for fair dismissal in the Bill. I have some problems with the noble Lord’s suggestion, because if it is not in primary legislation, it will come as secondary legislation. We all know that His Majesty’s loyal Opposition never kill secondary legislation—I am looking at them. We would like to from time to time because it should happen; there should be a sense of jeopardy in secondary legislation, which currently there is not. Without that sense of jeopardy, I am not happy with taking things out. However, if it is in primary legislation, the consultation is not worth anything because it is already there, so we might as well forget about that.

Trade Act 2021 (Power to Implement International Trade Agreements) (Extension to Expiry) Regulations 2025

Lord Fox Excerpts

Monday 10th November 2025 Grand Committee

I therefore have two questions to put to the Minister. First, what are the Government’s plans to undo some of the damage done to our phytosanitary standards and to farmers by the Australian trade deal? Secondly, what plans do the Government have to improve the level of democratic scrutiny over trade deals in the future?

[Lord Fox (LD)]

My Lords, on the point made by the noble Baroness, Lady Bennett, about not being obtuse, it is compulsory to be obtuse on this subject.

I again welcome the Minister to the Dispatch Box, with him having made a very accomplished maiden speech on the previous occasion which I boldly attempted to interrupt. This job may not have taken much selling to him by the Government, but I hope they told him, as I said to his predecessor, “What you’re really going to have to do is statutory instruments with a group of people who contracted Stockholm syndrome having been in the same room with the Conservative Front Bench literally for weeks”. I congratulate him and welcome him to his first statutory instrument on this.

As we have heard, the purpose here is to continue to extend the powers of the Trade Act 2021 beyond the end of the year. Why would you let a power lapse when you could keep it going? The answer I would infer is “just in case”. I am sure that no government would accidentally let go of powers, so that is perhaps the motivation. However, it is with these powers that the Executive partially exercise the royal prerogative which they use to maintain control over trade deals—what we sign, what they contain and how they are implemented.

Having happily spotted that the noble Lord, Lord Lansley, would speak, I did not prepare a whole bunch of detailed questions on this statutory instrument. I did, however, prepare a broader critique of the scrutiny process that exists for trade deals and their like.

As the noble and learned Lord, Lord Goldsmith KC, who chairs the International Agreements Committee, remarked in the front piece of a recent report on trade scrutiny,

“Treaties have the potential to raise matters of very great public importance”,


including trade agreements, but also other treaties such as the Rwanda treaty and the Chagos Islands agreement. He went on:

“Government has the power to negotiate and conclude treaties but it is important that Parliament can hold it to account effectively for its actions”.


That is where I am going to focus my speech; I am not going to challenge the validity of this statutory instrument, but I want to look at the scrutiny gap a little more, because it is a way of welcoming the Trade Minister to a really important matter. I hope that he will see the need for helping to improve Parliament’s grasp on what is happening.

When this statutory instrument was debated in the Commons, my friend the MP for Richmond Park—that is the Richmond in Surrey—Sarah Olney, gave the process a clinical demolition. She noted up front:

“The Liberal Democrats strongly opposed the Trade Act 2021, as it failed to provide sufficient parliamentary scrutiny of future trade agreements and risked weakening the UK’s high standards on health, food, labour and the environment”,—[Official Report, Commons, Second Delegated Legislation Committee, 4/11/25; col. 5.]


and we heard a little of that just now.

The then Bill passed through the House of Commons in 2020 without amendment, despite cross-party efforts to introduce greater transparency and accountability. I tabled quite a few amendments in the Lords, as did others, but Sarah tabled amendments requiring transparent investment courts for investor disputes. This was to ensure human rights considerations in trade negotiations and to mandate assessment of trade agreements. Those, along with other opposition amendments—such as protections for the NHS and food standards—were voted down by the then Government.

We believe that trade deals have been weaker without these imperatives. We warned that the omission could lead to deals that lower standards or allow foreign influence over our public services. Now, as then, we believe that the 2021 Act grants excessive powers to Ministers, excluding MPs and your Lordships from meaningful involvement. It also provides no guarantee that UK standards, public services or democratic accountability will be protected.

The Lib Dems are not unique in calling for greater scrutiny. The most recent report from your Lordships’ International Agreements Committee—the one on which the noble and learned Lord, Lord Goldsmith, commented —is entitled Treaty Scrutiny in Westminster: Addressing the Accountability Gap. The news release for the report states that it

“concludes that the current statutory process for parliamentary scrutiny of treaties under Part 2 of the Constitutional Reform and Governance Act 2010”—

or CRaG, as it is affectionately known by its devotees—

“is a weak and insufficient mechanism for securing meaningful accountability. The process has not changed significantly since the 1920s”.

Indeed, the Grimstone undertaking is about the most significant change that has happened since 1920. That is not hyperbole; it is a fact. Of course, in the 1920s, treaties had rather less impact on domestic affairs—they did not reach into public services or domestic standards in the way they do now—so we believe that too much discretion is given to the Government to act in ways that enable them to evade detailed scrutiny.

The news release further states that the report

“acknowledges that there is a balance to be struck between the flexibility the Government needs to negotiate and conclude treaties in the national interest and the transparency and scrutiny which the public interest requires. However, while the treaty scrutiny procedure codified in the 2010 Act”—

that is, CRaG—

“places some limits on the autonomy which the Government enjoys in international relations, the legislation tilts the balance too far in the Government’s favour. The report finds that the UK scrutiny process is weak in comparison with most other countries … The report concludes there is a powerful case for legislative reform and calls on the Government to engage seriously in a dialogue with Parliament … about this. Recognizing that legislative reform will take time, however, the report also recommends steps to make scrutiny under the current framework more effective provided the Government shows sufficient … will”.

I commend the report to the Minister; he should have a look at it because it is, obviously, very important to the portfolio that he now holds.

We Liberal Democrats will not vote against this draft statutory instrument, of course, but we will continue to call for reforms to ensure transparency and fairness in, and public scrutiny of, future trade policy. I look forward to the Minister’s reflections, as a newcomer, on trade policy and its scrutiny.

[Lord Hunt of Wirral (Con)]

My Lords, I join noble Lords in welcoming the Minister. I too participated in the debate on the steel industry, mentioned by the noble Lord, Lord Fox, where we had the benefit of two maiden speeches from the two new Ministers, the noble Baroness, Lady Lloyd, and the noble Lord, Lord Stockwood. Looking back, that was a really good, wide-ranging debate. I thought this would be a very narrow, rather simple statutory instrument to deal with, having looked at it—until my noble friend Lord Lansley got up. It may be that it applies only to continuity agreements, but thanks to the noble Baroness, Lady Bennett of Manor Castle, and the noble Lord, Lord Fox, we have entered a much wider debate. If I were the Minister, I would welcome that, because it gives him an opportunity to set the framework in the ways that my colleagues have outlined.

Having said all that, this instrument merely seeks to extend for a further five years the power under the Trade Act 2021. This power enables Ministers, including those in devolved Governments, to make regulations to implement the non-tariff provisions of continuity trade agreements with so-called partner countries—those that had agreements with the European Union before the UK’s exit. This instrument does not change the substance of the policy; it merely extends the time within which that power may be used from December 2025 to December 2030.

The rationale is that it will bring legal certainty and flexibility to implement existing and future agreements. I understood that it is particularly directed to those agreements under discussion with Switzerland and Turkey. I hope the Minister will be able to explain the context and answer the questions posed by my noble friend Lord Lansley. I would also like to know what has happened concerning the agreement under discussion with the Republic of Korea; the Minister may well be able to explain why he omitted to mention it.

Continuity and predictability in our trading relationships are indeed important for British businesses and exporters, particularly small and medium-sized operations. It is also sensible that the devolved Administrations can continue to use this power where matters fall within their competence. From paragraph 6.6 of the Explanatory Memorandum, on the legislative and legal context, I understood that the devolved Governments had been asked and were consulted on the power in Section 2(1). What happened in those consultations and what responses were received from the devolved Governments?

Then we have the whole question of parliamentary scrutiny of trade agreements, which has been raised in this debate. It would be very helpful if the Minister could give us some outline of what his approach will be and the approach of his department. I would also like to press him on several points of oversight and accountability.

First, the powers granted under Section 2(1) must always be exercised within the statutory protections set out in the Trade Act. I instance employment rights; environmental standards, already referred to; animal welfare; data protection; and the integrity of our publicly funded healthcare services. It would be really helpful if the Minister could give us assurances on those points. Secondly, I would like him to give us a little more context about how this five-year period has been calculated. It must be used wisely. The power was always intended to be a transitional mechanism following EU exit. From looking back at those debates, already referred to, it was never seen as a permanent feature of trade policy. We therefore expect the Department for Business and Trade to report in due course on how frequently the power has been used and whether a further extension beyond 2030 will genuinely be necessary.

--- Later in debate ---

[Lord Stockwood (Lab)]

I am very grateful to noble Lords for their generous welcome and continued acknowledgement of my novice status in quite a technical debate, alongside the comments and questions they have put to the Government. To reiterate, these regulations are crucial to the Government’s trade agenda. We anticipate that we will be required to domestically implement deals currently under negotiation that will greatly benefit UK consumers and businesses.

I turn to answer the questions raised in the debate, starting with the noble Lord, Lord Lansley, who asked about the necessity of the Trade Act powers in today’s legislative context, with regard to live negotiations. The question was whether the powers in the Trade Act are still necessary. The answer is that negotiations with partner countries are ongoing, and I would not like to pre-empt any future talks that may take place. The powers in Section 2 have been used for statutory instruments relating to procurement, but also for free trade agreement implementation—for example, the mutual recognition agreements—as well as for the Trade (Mobile Roaming) Regulations and the Chemicals (Health and Safety) Trade and Miscellaneous Amendments Regulations. We therefore believe that the ongoing management of our trade agreements justifies extending the power.

I should have said upfront, by the way, that if I do not go into enough detail I am happy to write rather beyond the narrow range of this debate. I look forward to having broader conversations outside the Room as well.

The second question was from the noble Baroness, Lady Bennett, about protections for phytosanitary standards in future trade agreements. During the passage of the Trade Act, my party worked hard to ensure the inclusion of robust safeguards in Section 2. These guardrails require that any regulations made under Section 2 must uphold existing UK statutory protections in key areas, including environmental protection. A full list of these guardrails can be found in Section 2(5) and 2(7). Preserving our world-class standards is a priority and we will not compromise on any of them for our trade policy.

A number of noble Lords raised a secondary question about future plans for democratic scrutiny of trade deals. We believe that the current statutory and non-statutory commitments governing the scrutiny of free trade agreements are robust and fitting for a country with our constitutional make-up. Our scrutiny arrangements are similar to and, in some areas, better than other Westminster-style systems, such as Australia, New Zealand and Canada, but our non-statutory commitments include, for new FTA negotiations, that the Government will undertake a public consultation or a call for input. Should a relevant Select Committee publish a report on these objectives and, should it request one, we will facilitate a debate, subject to parliamentary time.

Furthermore, during negotiations, the Government will publish regular updates and provide regular open briefings for all MPs and Peers. Post signature, the Government will—

[Lord Fox (LD)]

I am sorry—I can at least intervene at this point. The point that the Minister has made on a couple of occasions is not exactly right. The report that the International Agreements Committee put forward says that the idea that the way in which our democratic process is organised somehow means that countries that are like ours are the same as us is fundamentally not true. The evidence is laid out in the report that I mentioned in my speech. I ask the Minister to go and read it, and perhaps discuss it with his department.

On the subject of parliamentary time, without getting into too much detail on CRaG, the only way in which a trade deal can be delayed is by the Commons having a parliamentary debate, and the only way in which the Commons can have a parliamentary debate is by the Government granting them one. The evidence suggests that that does not happen, so it is a deeply flawed relief valve in the system and something that would, again, merit reconsideration.

[Lord Stockwood (Lab)]

I thank the noble Lord for his follow-up question. This Government are trying to go beyond the statutory requirements.

The noble Lord, Lord Fox, asked this question earlier: is CRaG inadequate in the modern context? I will go away and read the report so that I have a further written answer for him, but I come back to the idea that CRaG provides an effective and robust framework for the scrutiny of treaties that require ratification, including free trade agreements. Although it was formally legislated for in 2010 under the previous Labour Government, its origins date back more than 100 years. Under CRaG, the Government must lay relevant treaties before Parliament for 21 sitting days before it can ratify them. Parliament has the power to prevent ratification; in the case of the House of Commons, it can do so indefinitely.

In line with the Government’s commitment to transparency, we have gone well beyond the statutory requirements for CRaG and provided comprehensive information to Parliament to support its scrutiny of our trade policy approach. In addition, no trade agreement can in itself alter our domestic legislation, and any changes to our UK legislation that are required for trade agreements will need to be scrutinised and passed by Parliament in the usual way. However, I take the noble Lord’s comments on board; we will come back with a fuller answer.

On the noble Lord’s other points, which were about protections in trade agreements for human rights, animal welfare and the NHS, as I have said, preserving our world-class standards is a priority. We will not compromise them in our trade policy. Regulations 2, 5 and 7 contain safeguards in the areas mentioned by the noble Lord, Lord Fox; we will ensure that they are upheld. None of our FTAs, which are not covered by this power, has undermined our NHS or domestic standards. Parliament has debated this matter at length in its debates on the Australian FTA, the New Zealand FTA and our ascension to the CPTPP. Both required primary legislation.

The noble Lord, Lord Hunt, asked a question about devolution. DBT Ministers wrote to their counterparts in the devolved Governments on 11 August 2025 to inform them of our intention to lay this SI before Parliament. In keeping with our commitment to transparency, we also shared a draft version of the SI for comment. In addition, we committed to maintaining the safeguards around the Section 21 power, as laid down in the Trade Act 2021.

On the question about the use of this SI’s power, before laying the SI, the Government reviewed whether the circumstances were such that the power in Section 2(1) ought to be extended; this provided an opportunity for the power in Section 2(1) to be reviewed. It was HMG’s conclusion that an extension to the power would be necessary. It is possible that the power in Section 2(1) may be relied on to enable the effective domestic implementation of major forthcoming trade agreements with key partners, such as Switzerland and Turkey, but also for the ongoing maintenance of existing agreements.

[Lord Lansley (Con)]

The Minister has again referenced Switzerland and Turkey. Let us leave Switzerland to one side because there is a pretty comprehensive continuity agreement between the European Union and Switzerland, which we have replicated.

Where Turkey is concerned, I want to stick with the question of mutual recognition agreement on conformity assessments. As I understand it, the European Union’s agreement with Turkey does not include a mutual recognition agreement on conformity assessment, although the negotiations between the United Kingdom and Turkey around an extension of a free trade agreement in future might include such a thing; we do not have to decide whether it would or would not. If such an agreement were entered into with Turkey, that would create an agreement with Turkey beyond the scope of the agreement that constituted the continuity agreement because it would include something that was not in the original continuity agreement with the European Union. My question is, therefore, very simple. The Minister does not have to answer it now; he can take it away and have a think about it. If we were to agree with Turkey something that was not in the European Union-Turkey agreement and, hence, not in the continuity agreement that we signed way back in 2021, could it be implemented under the Trade Act 2021 or would that require additional primary legislation?

[Lord Fox (LD)]

We could extend the same question to the situation with Korea, where my understanding is that the current continuity agreement is being rolled over again prior to the negotiation of a new deal. Were a new Korea deal to be negotiated, the question would be the same as the one put by the noble Lord, Lord Lansley.

[Lord Stockwood (Lab)]

I thank noble Lords for those follow-up questions. I am reliably informed that both of those negotiations are under way at the moment, so I will come back with a full answer in writing, if that is okay. I am grateful for the support across the Committee for these draft regulations.