Code of Practice on Reasonable Steps to be taken by a Trade Union (Minimum Service Levels)

Lord Fox Excerpts

Wednesday 6th December 2023 Lords Chamber

Many thousands of people continued bravely to work for the freedom of those martyrs and the rights that they espoused in their absence, eventually winning the men’s freedom. They then won the right to withdraw their labour, thought now to be definitively established. That people should have hope is crucial—it matters—which is one more reason why I put down these fatal amendments. We know that there is significant, strong opposition to these regulations, and a determination to stand firm. If others will not ensure that there is parliamentary expression of that, let me say for the record in Hansard that the Green Party will step up to the plate.

[Lord Fox (LD)]

My Lords—

[The Deputy Speaker (Lord Geddes) (Con)]

I was so fascinated by the noble Baroness’s speech.

[Lord Fox (LD)]

I apologise to the Deputy Speaker for stepping up too soon.

I thank the Minister for describing the first on the menu of the four statutory instruments we will be tasting today. I think that he was yet the ascend the rickety stairs of ministerial responsibility when the noble Lord, Lord Collins, the noble Baroness, Lady Jones—when she was among us—and I were debating the substantive nature of this Bill, so we welcome him to this tiny corner of legislation. It is a shame that the noble Lord, Lord Callanan, has now left as I thought he was overseeing the realisation of his creature; of course, it was the noble Lord, Lord Callanan, with whom we debated. Actually, the Minister did not miss a lot of the substance of the legislation because, as the noble Lord, Lord Collins, pointed out, there was not a great deal of substance in the enabling Bill. It is these statutory instruments that we will see today that begin to put the soft tissue on to the skeleton of that Bill.

There are four instruments, but we are looking in particular at the one aimed at tying the unions up in procedural knots. It is laying legal traps by which they can be caught out, with potentially existential sanctions. None of us enjoys the effects of public sector strikes—the Minister described those effects today. Swathes of society are inconvenienced and, in the case of the health service, it is much worse than an inconvenience. It behoves any Government to create the conditions for ending strikes as soon as possible, but this legislation does not create those conditions. As we heard from the noble Lord, Lord Collins, it creates heat and friction and makes settlement less likely. For the benefit of this Minister, I will repeat what I said while we were debating the Bill: disputes end only when the relevant parties sit down, talk and negotiate. It is for Governments to act to maximise the opportunity of those negotiations, rather than turn one party on the other.

I will concentrate on the operational faults of this statutory instrument, because therein lie the traps for unions. It really begs the question of how reasonable the code’s “reasonable steps” are? Unions must ensure that their members comply with the employer’s work notices. A work notice, as we have heard, is essentially a list of names associated to tasks for that particular service. Its purpose is to seek to deliver an agreed level of service—a handed-down level of service from government to the employer to the union. To comply, the union must first filter out the non-union members from that list and then take “reasonable steps” to ensure that its members do not honour that strike—a strike that the union itself has legitimately and legally called. To do this, the unions are likely to have extremely tight deadlines—deliberately unreasonable deadlines, I suggest.

Employers have only to provide a work notice seven days before a strike commences. That notice—the list—can be further amended, leaving only three days for the union to contact its members. That is not three working days, just three days, so it could include Saturday and Sunday. We have seen the pro forma; this communication must encourage them to pass through the union’s picket lines and go to work. I remind your Lordships, including those of us who were at the debate, that picket lines and picketing were never mentioned in the original discussion.

To go back to the procedural difficulties, some disputes are small and involve few union members. But the nature of the industries covered by the Act means that disputes are likely to be countrywide and involve tens of thousands of employees, maybe more, so I ask the Minister: is it a reasonable step to ask a union to track down and contact 20,000 people in three days, perhaps over a weekend? How does he expect that contact to be made? Will it be by email? He may be surprised to know that not everybody has email, and further surprised to find out that not everybody hands over their email address to their union. Will it be put on a postcard? I suggest that the postal service may not get it there in time.

There are serious impediments to the taking of these reasonable steps—or possibly unreasonable steps—but let us say that the union succeeds in crossing these hurdles and navigating its way through the minefield set out in this statutory instrument. Can the Minister confirm that the union is therefore indemnified from prosecution if some or all of its members still choose to ignore its advice and honour the strike? What is the legal position of the union? The point raised by the noble Lord, Lord Collins, about how we prove that the steps were reasonable still remains but, in negotiating those reasonable steps, can the Minister confirm that the union is then indemnified?

One would expect the TUC to be critical of this legislation, as it is, but what about ACAS, the Advisory, Conciliation and Arbitration Service, which is the expert at putting people around a table and trying to solve these problems? It too expressed reservations and asked why—I have relayed this to the Minister—if the reasonable steps for unions are set out in detail, similar steps are not set out for employers. Why are similar steps not also set out for the Secretary of State in his or her dealings on these issues? For example, what is to stop the employers overstating the number of persons reasonably necessary to provide the minimum service level mandated by the Secretary of State? Those are not my questions but ACAS’s. At the moment, as far as I can see, there is nothing to stop them. How would the union challenge that, given the time available and the current state of the code?

Digital Markets, Competition and Consumers Bill

Lord Fox Excerpts

2nd reading
Tuesday 5th December 2023 Lords Chamber

[Lord Fox (LD)]

My Lords, it is a great pleasure to be working on this Bill—a Bill that we on these Benches broadly welcome. I hope we will be able to work constructively to improve it as it moves through your Lordships’ House. It is about time, as the noble Lord, Lord Bassam, noted. The Furman report was set up five or six years ago; we have been impatient for competition law in the digital space to be reformed and for the Digital Markets Unit to be empowered—so, at last.

As the noble Lord, Lord Bassam, also noted, this is a big Bill, and it acts in a number of different ways. I fear that many of the things I say will be similar to what was said by the noble Lord; in order to maintain novelty, I will probably say them in a different order.

I will start with consumer issues. Clearly, these issues have excited correspondence from a lot of people in the outside world. We should note and thank them for the work that they have done in sending through a load of briefings. There are some important issues here, and areas that should be tightened up and improved. These include: tackling online scams, dealing with product safety issues and strengthening trading standards; taking action on primary and secondary ticketing; impeding price drip and mid-contract price rises; addressing the pernicious nature of fake reviews, as we heard from the Minister; devising a sensible way of redesigning automatic subscription rollover—there is a danger of us taking a number of other areas down with the law we have, so we must be careful of unintended consequences of that move—and delivering a range of other consumer rights, such as the possibility of collective action for consumer claims. I am sure there will be plenty of grist to this mill as we work through that part of the Bill.

Moving on from consumers, the second big challenge is the need to tip the balance of power toward content providers—and here I should declare that I have several creators in my family. As a basic principle, all content creators should be properly paid for the work they do. UK law requires payment for the commercial use of another’s copyrighted work, yet commercial use is currently being made of content by global platforms without any permission being obtained or payment being made. The dominant platforms profit from the efforts of content creators, from songwriters and artists to publishers and broadcasters, and they do not get rewarded.

The News Media Association estimates that over 50% of searches are news-related, but Google keeps the value of repeated visits and the value of online footfall that is generated. As such, copyright law looks foolish, as the system is being gamed. Smaller players must try to sue their distributors to enforce their rights, but they cannot risk such a move or indeed afford to take them on. Indeed, the evidence suggests that it is difficult even for Governments to challenge these platforms. After almighty tussles, the Australian and Canadian Governments have won concessions. It remains to be fully appreciated how those will pan out but, as well as highlighting the global dominance of the big two, those fights highlighted an essential difference between Meta and Google when it comes to news content, which is of great interest.

The Bill must make it clear that platforms need to pay properly and fairly, on benchmarked terms and with reference to value for end users. Additional clarification is needed on how a final offer mechanism would work in practice, and we will be seeking that, but really a bigger change is needed. That change should require those using and distributing content to obtain the owners’ permission before they use it, and we will be pushing for that.

I remind noble Lords that that we are discussing the Digital Markets, Competition and Consumer Bill—so competition is a central part of it and we have already heard elements of that. But, in the market that we are looking at, competition is weak—if not frail, to perhaps overstate it. In our view, the pro-competition interventions are one of the Bill’s most powerful features and a big step forward. We must use the Bill process to ensure that the powers are sufficient and Ministers must articulate government support for the ambition that the CMA and its DMU will need in order to start to take on the competition challenge, because that will require a big shift in emphasis from the CMA.

At present the CMA deals with a lot of mergers— 50 to 70 detailed investigations a year—while enforcement typically attracts fewer than 10 cases per annum and there are hundreds of complaints for it to deal with. When looking at competition matters, including acquisitions and mergers, the world’s competition authorities have focused on efficiency and short-term consumer benefit, but, as we have been reminded recently by the Court of Appeal when it found against Apple, the overriding objective of the CMA, as set out in the 2013 Act, is to promote competition in the interests of consumers.

“Promoting competition” does not mean just assessing the efficiency of a monopolist; in digital markets, this approach has delivered global oligopoly. So, while Web 1.0 was an open access—albeit read-only—platform, Web 2.0 has been captured, intermediated and monetised by a very small number of profitable concerns. That has been achieved largely through acquisitions that have been waved through by the authorities. Looking at the publicly disclosed acquisitions between 2008 and 2018, we see that Google has acquired 168 companies, Facebook 71 and Amazon 60. Now, thanks to this and other things, they control the core software in web browsers and device operating systems, and through that control they determine what we see, what we find, what we search on the web and how we pay for stuff.

The Bill is, in many respects, seeking to close the gaping doors of empty stables that this approach has delivered and, to do so, short-term consumer welfare cannot be the sole—or sometimes even the primary—consideration. Promoting competition means taking into account market structure and the ability of players to innovate. When looking at mergers, regard has to be taken of the effect of allowing large companies to buy innovative ones so that they can assimilate or retire their ideas and technology. In that context, we very much welcome the CMA’s approach to the Microsoft acquisition of Activision Blizzard and Ofcom’s decision to refer the hyperscalers in cloud services for an investigation by the CMA. This demonstrates that the CMA is up for a global challenge in this strategic way and that it can play a leadership role.

Looking forward, as well as mitigating the competitive and consumer issues thrown up by the centralised Web 2.0, the Bill should empower the CMA to help usher in a genuinely decentralised Web 3.0. As Professor Furman reminded us in evidence in Committee in the Commons, intervention interoperability is a vital remedy—and we say that interfering with interoperability in all its forms should be policed by the DMU. That means embarking on investigations and actions with the aim of distributing the power and control over Web 3.0, creating a network that spans a large base of independent actors. This speaks to the technology on which the network is based and the standards that are set to deliver that network.

It seems clear that the DMU should be proactive with respect to promoting international standards and aiming to create that interoperability: for a start, by focusing on open access and operational transparency, working for standards that allow unrestricted participation and favouring the technologies and protocols that prevent a single person or group amending or reversing transactions executed and recorded. It would be good to hear from the Minister, when he sums up, on the role that the Government feel the DMU and the CMA should be playing on the standards authorities—the IETF and the W3C. How do we see engaging further and more thoroughly with those standards bodies, because that is where the first fight starts in these technology issues?

So there is a lot resting on this Bill. The architecture of the web is currently threatened by those who would create and preserve their own walled gardens of content that is provided by others, privatise a public resource for their own ends and monopolise all content offered to the public via the internet for their own profit. This is not an abstract need; additional danger is already with us. Big tech is busy wrapping its tentacles around AI, including by co-opting start-ups for investments and partnerships. It is critical that the CMA uses these new powers to keep that technology open before it, too, is intermediated.

To deliver on this, however, there are many issues to be addressed. Your Lordships will no doubt come up with many others; we have already heard a list from the noble Lord, Lord Bassam, who will be pleased to know that there are many coincident issues. I will give a short list before I end of the issues that we will be keeping an eye on: ensuring that the Bill no longer gifts to strategic market status players the opportunity to challenge DMU decisions on the basis of lack of evidence, which means looking at the five-year view that is required; securing the role of judicial review and making sure it is not eroded; strengthening the leveraging principle that denies third-party developers revenue; understanding the Government’s position on data and information-sharing; clarifying how the final-offer mechanism would work in practice; probing the proportionality tests brought in via the latest amendments; challenging the changes to the definition of “counter- vailing benefit”, which also came through the amendments; enabling those with content to be paid properly; and allowing smaller businesses a voice and an ability to bring claims and, where possible, be awarded exemplary damages.

This Bill is a weighty tome, but it has a vital role in shaping the architecture and landscape in which the future digital economy will be built. It will help establish how the value of this economy is created and distributed. It will influence how easy or hard it is for challengers and disrupters to enter the market. Our job, therefore, will be to ensure that the CMA and DMU have the powers they need, but, more than that, our job is to articulate the cross-party ambition we have for this direction of travel and to launch the DMU with our overwhelming support to maximise its success.

--- Later in debate ---

[The Parliamentary Under-Secretary of State, Department for Science, Innovation and Technology (Viscount Camrose) (Con)]

My Lords, I thank all today’s speakers for their eloquent, clear and powerful contributions to what has been a fascinating debate of the very highest quality. In particular, a number of speakers referred back to the Online Safety Act debates and variants of the warm glow. I am delighted to participate in any such approach to the Bill, as is my noble friend Lord Offord. I welcome very much the support shown across the House for this legislation, with the caveats gone into by many speakers. As my noble friend said in his opening speech, this is an important Bill which will drive innovation, grow the economy and deliver better outcomes for consumers. The debate we have engaged in is demonstrative of noble Lords’ desire to ensure that digital markets are competitive and work well, and that consumers are protected from the potential harms posed by anti-competitive and unscrupulous practices.

I will respond to the questions raised, cutting across a number of issues and speakers as I go. First, my noble friend Lady Stowell and the noble Lords, Lord Bassam and Lord Clement-Jones, asked, quite rightly, whether we are watering down the Bill. Let me categorically say that that is absolutely not the intention. The amendments at Commons Report brought further clarity, and they will ensure that the DMU’s interventions are proportionate and drive the best possible outcome for consumers. I look forward to discussing this further during the Bill’s passage.

I turn to the appeals standard in the digital markets regime, which was raised by noble Lords across the House, including my noble friends Lord Vaizey, Lord Kamall, Lady Stowell, Lady Harding, Lord Black and Lord Lansley, the noble Lords, Lord Bassam and Lord Clement-Jones, and the noble Baronesses, Lady Kidron, Lady Ritchie and Lady Jones. We have considered strong and differing views about appeals from a range of stakeholders. Judicial review remains the appropriate standard for the majority of decisions in the regime, and we have maintained that for appeals of regulatory decisions, with additional clarification on the need for the Digital Markets Unit to act proportionately. Firms would already have been able to challenge decisions to impose interventions on the basis that there were disproportionate interferences with their rights under the European Convention on Human Rights. This amendment allows that challenge to happen under usual JR principles. Moving appeals on penalties to full merits brings the regime into line with the Enterprise Act 2002. It will mean that, once a breach has been found, a firm could argue that the imposition of a penalty was not appropriate, the level of it was not suitable, or the date by which it should be paid needs to be changed.

I turn to the countervailing benefits exemption, which was raised by a number of noble Lords, including my noble friends Lady Harding, Lord Vaizey, Lord Lansley, Lord Kamall, Lord Black, Lady Stowell, the noble Lords, Lord Bassam, Lord Clement-Jones and Lord Fox, the noble Viscount, Lord Colville, and the noble Baronesses, Lady Ritchie and Lady Kidron—I see the point about themes. I reassure all noble Lords that this is a further safeguard in the legislation to ensure that consumer benefits which might have been unknown when conduct requirements were first introduced can be recognised. The noble Lord, Lord Bassam, asked for an example of how this could work in practice. If an SMS firm bans an application on its platform, it might breach a conduct requirement not to apply discriminatory terms. The firm could claim that the ban was to protect user security and privacy. Thanks to the exemption’s high bar, the DMU would close its investigation only if the SMS firm provided sufficient evidence, such as an independent report from security experts. Firms will not be able to use the exemption to delay enforcement. Assessment of whether the exemption applies will take place during the enforcement investigation, which has a deadline of six months.

The noble Lords, Lord Fox and Lord Bassam, and my noble friends Lord Vaizey, Lady Harding and Lord Kamall asked about the change to the indispensability wording. The change of the language is to clarify the exemption; it maintains the same high threshold and makes sure that consumers get the best outcomes possible, whether through the benefits provided or through more competitive markets.

I thank the noble Lord, Lord Tyrie, for his detailed analysis of the work of the CMA and his continued support for the legislation. He raised the matter of proper scrutiny of the CMA. I very much agree with him on the importance of this and look forward to continuing that conversation.

The noble Viscount, Lord Colville, the noble Lord, Lord Clement-Jones, and my noble friends Lady Stowell and Lord Kamall sought reassurance that requiring the Secretary of State to approve guidance would not cause delays. The Government are committed to ensuring that approval is given in good time, in order for the regime to be in place as soon as possible. Introducing a statutory timeline for this process would limit the Government’s ability to work collaboratively with the CMA.

My noble friend Lord Holmes and the noble Lord, Lord Vaux, raised the importance of the independence of the regulator, and the noble Baroness, Lady Kidron, spoke about the risk of regulatory capture. I agree that this is an absolutely vital issue. The noble Lord, Lord Bassam, and my noble friend Lord Holmes asked about the resourcing and tools of the DMU. I reassure them that the Government have full confidence in the DMU’s resourcing. There are currently around 70 people working in DMU roles, and we expect the DMU to be around 200 people in steady state.

A number of noble Lords, including my noble friend Lord Black, the noble Viscount, Lord Colville, the noble Lord, Lord Clement-Jones, and the noble Baronesses, Lady Kidron, Lady Bennett, Lady Jones and Lady Ritchie, raised the importance of support for the press sector, with which I agree. The digital markets regime aims to address the far-reaching power of the biggest tech firms and help rebalance the relationship between those platforms and other businesses, including publishers. This will make an important contribution to the sustainability of the press, which is so important in all aspects of our lives.

The noble Viscount, Lord Colville, the noble Lord, Lord Fox, my noble friend Lord Black and the noble Baroness, Lady Ritchie, asked about the final offer mechanism and how this will work. The final offer mechanism is a backstop measure to help resolve sustained breaches of conduct requirements relating exclusively to fair and reasonable payment terms, where other DMU tools are unlikely to resolve the breach in a reasonable timeframe. Unlike the Australian and Canadian models, the final offer mechanism is not a standalone tool to force negotiations. It forms just one part of the DMU’s holistic toolkit for promoting competition in digital markets. The DMU will be able to impose conduct requirements on the firm from day one of its designation, including requirements to ensure fair and reasonable terms. However, we recognise that some stakeholders may be concerned about SMS firms frustrating the process. Here, the CMA can seek to accelerate the stages before the final offer mechanism, making use of urgent deadlines on enforcement orders and significant financial penalties, where appropriate.

The noble Lord, Lord Knight, and the noble Baronesses, Lady Bennett, Lady Jones and Lady Uddin, asked if the regulator will have sufficient power to deal with imbalances in access to data. The answer is yes. These are exactly the kinds of issues that the DMU will be able to address.

The noble Viscount, Lord Colville, and the noble Baroness, Lady Uddin, asked how the digital markets regime will address the rise of artificial intelligence. The regime has been designed to be tech-neutral, future-proof and flexible enough to adapt to changing digital markets.

I now turn to questions raised today on the competition part of the Bill. I note the interest from my noble friend Lord Sandhurst in the recent Supreme Court judgment on the status of litigation funding agreements—LFAs—and its potential impact on the ability to bring collective actions on behalf of consumers across the legal system. The Government have urgently addressed the potential implications of the judgment on claims under competition law, and we feel this has provided some much-needed certainty to funders and claimants. I also note the interest from my noble friend and others across the House in extending this to all parts of the civil legal system. While I am advised that this Bill is not the appropriate vehicle to deliver this aim, I can assure noble Lords that the Ministry of Justice is actively considering options for a wider response.

I now turn to the consumer part of the Bill. Several noble Lords, including my noble friend Lord Black, the noble Lords, Lord Vaux, Lord Clement-Jones and Lord Bassam, and the noble Baroness, Lady Jones, posed questions about the approach taken in the Bill on subscription traps. The measures being taken forward are the ones which are necessary and proportionate to ensure that consumers are treated fairly and understand what they are signing up to, while balancing further costs and regulatory burdens on businesses.

A number of noble Lords—I hope noble Lords will forgive me if I do not read out the full list, because there are far too many of them and it might test everyone’s patience—raised concerns about potential unintended consequences for charities in relation to the new subscription rules, in particular their ability to claim gift aid. Donations to charities where nothing is received in return are not subject to the subscription rules. Generally, charities will only be in scope if they provide auto-renewing contracts to consumers for products and services in return for payment. This is consistent with other consumer protection laws. I reassure the House that it is not the Bill’s intention to undermine access to gift aid; we are examining this issue closely and will provide a further update in Committee.

Many noble Lords, including the noble Lords, Lord Bassam and Lord Fox, raised other consumer harms such as drip pricing and fake reviews. The Government have recently consulted on proposals to address these and other practices, and our upcoming consultation response will set out next steps. The noble Baroness, Lady Bennett, also mentioned misleading green claims. This is indeed an important issue, which we hope is already covered by existing regulations.

I agree with the noble Baroness, Lady Hayman, and my noble friend Lord Holmes that the right to repair is important. The right-to-repair regulations which came into force on 1 July 2021 address some of the issues she raised. My noble friend Lord Offord, as the responsible Minister, would be happy to meet her to discuss this further.

My noble friend Lord Holmes raised concerns about Henry VIII powers. Where the powers to amend primary legislation would permit major changes to the legislation concerned, they are subject to the draft affirmative procedure.

I hope that in wrapping up I have responded to at least most of the points raised by noble Lords today. I note that there were other issues raised which I have not addressed, such as alternative dispute resolution and secondary ticketing. I look forward to discussing those items and others during the Bill’s passage. Let me once again thank all noble Lords for their contributions and engagement, not just today but in the lead-up to it. My noble friend Lord Offord and I look forward to further and more detailed debates on these matters and many more besides in Committee.

[Lord Fox (LD)]

Before the Minister sits down, I should say that I mentioned the central role that standards and the setting of future standards have. The Minister need not answer the question now, but could he write to me about the strategy, in a sense, and the involvement that the DMU might have, or should have, in future standards-setting for the technology?

[Viscount Camrose (Con)]

I apologise to the noble Lord for not addressing that. Absolutely I will write.

Northern Ireland Investment Summit

Lord Fox Excerpts

Thursday 23rd November 2023 Lords Chamber

[Lord Johnson of Lainston (Con)]

I am grateful to my noble friend for that prompt. The Northern Ireland Investment Summit was itself ultimately funded by an initiative led by our current Prime Minister when he was Chancellor of the Exchequer. I am determined to ensure that we follow up, which is why, this week, we hosted a round table at No. 10 with venture capitalists, to encourage investment in Northern Ireland. We supported Joe Kennedy’s mission and we have many more projects and plans to come. However, I note my noble friend’s recommendation for a further summit. It is something I would certainly celebrate, but we have to ensure that we can pay for it and that it would deliver strong value for money for the taxpayer.

[Lord Fox (LD)]

My Lords, there appears to be rare harmony between the noble Baroness, Lady Hoey, and the Minister and myself. This was clearly a very successful event. Does the Minister put a strong measure of that success down to the fact that Northern Ireland has a unique opportunity, with access to both the EU and the UK markets? Is the Minister pushing that key selling point?

[Lord Johnson of Lainston (Con)]

I must say that I am delighted that my friend the noble Lord, Lord Fox, from the Liberal Democrat Benches is rejoicing and celebrating the benefits of Brexit, because that is exactly what the Windsor Framework delivers. It puts Northern Ireland in a unique place to benefit precisely from the regulatory environments and frameworks that we have in this nation, while at the same accessing the goods and markets in the European Union.

Workers’ Rights

Lord Fox Excerpts

Thursday 23rd November 2023 Lords Chamber

[Lord Johnson of Lainston (Con)]

I rejoice that the electronic ballot results have produced the leader of my own party. I recommend that trade unions look at ways to modernise—not just the way they ballot but the way they look at the economy. Ending the concept of labour flexibility in this country would be devastating, particularly to the sorts of investment I work on daily, including the celebration of over £20 billion of new capital committed to this country two days ago by a number of Korean companies. They are coming here because of our economic growth prospects and the flexibility of our labour markets, among other things. Trade unionists and all my colleagues opposite should remember that.

[Lord Fox (LD)]

My Lords, the Minister is no stranger to hyperbole, but his description of the CPTPP issues around intellectual property contains several misapprehensions. Could he undertake to read, carefully, the debate in Hansard that accompanied that Bill’s Second Reading? There are serious concerns from the creative industries about the clauses on intellectual property.

[Lord Johnson of Lainston (Con)]

I will read Hansard on that debate. I seem to remember being there myself; I delegated the opening to one of our newest Members. We promised, during that debate, to have a full consultation on how artists’ rights are treated. It is extremely important that we get the balance right. Ultimately, it is about fairness and equity, and we stand four-square behind that, as I am sure the noble Lord will agree is right.

British Steel

Lord Fox Excerpts

Wednesday 8th November 2023 Lords Chamber

[The Earl of Minto (Con)]

My Lords, obviously the loss of any jobs, particularly in a sector as important as steel, is to be deplored. However, there are commercial necessities that we are all fully aware of. The activity that the Government took in Port Talbot shows very clearly the commitment that we have to supporting the transition from historic steel-making to something more modern. As far as the production of virgin steel is concerned, the noble Lord is absolutely right that it will be affected by the closure of the smelting plants, but we will still be able to import limited amounts of iron ore pellets, which can be put towards the other steel that we have already within this country to produce what is required.

[Lord Fox (LD)]

My Lords, I welcome the Opposition spokesperson back to his Front Bench and thank the Minister for his answer. However, I do not think that he is grasping the point. Steel is vital to the economy, as the Answer said, but it is also vital to our strategic interest. At a time when we are talking about the need for secure supply chains, does the Minister recognise that this weakens the supply chain for our defence, aerospace and automotive industries?

[The Earl of Minto (Con)]

I completely understand the position of the noble Lord. During this transition period there is bound to be some effect. However, once the new systems are in place, there should be no change.

Post Office Compensation

Lord Fox Excerpts

Tuesday 19th September 2023 Lords Chamber

[Baroness Blake of Leeds (Lab)]

I thank the noble Earl for attending today to discuss yesterday’s important Statement in the other place concerning compensation for victims of the Post Office’s Horizon IT system failings.

What took place after the installation of Horizon accounting software started in the late 1990s has been referred to as one of the greatest scandals of modern times. The installation of the accounting software led to recorded shortfalls in cash at many branches. The truth is that, instead of questioning whether the software was working accurately, the Post Office instead believed that the shortfalls were caused by postmasters themselves, leading to dismissals, recovery of losses from the individuals concerned and, of course, in some cases criminal prosecutions.

The lives of decent, honest postmasters were ripped apart, with some cases resulting in prison sentences but, for all, a long and difficult wait for years to get justice. The consequences for some of those victims are just too awful to contemplate. The wait for resolution of compensation claims has only added to the intolerable burden so many have had to face.

We can all be grateful for the work done by Ministers and civil servants to make progress on this important matter, and I acknowledge the commitment and dedication of Members in both Houses continuing to work with victims through the Justice for Subpostmasters Alliance to sort this mess out.

We agree that there is logic in the proposals for compensation outlined in the Statement and welcome the clarification given in yesterday’s Statement by the Minister, Kevin Hollinrake. He acknowledged that 86 convictions have been overturned and that over £21 million has been paid out in compensation. However, due to the complexity of some claims, especially for personal damages, progress on full and final settlements has been slow. The proposal outlined is to offer a fixed sum of £600,00 for those who received an overturned conviction. Can the noble Earl tell us what specific methodology was used to arrive at this figure? Will he commit to publishing it for the sake of transparency?

I also seek clarification on a few factors. First, how many people does the noble Earl anticipate will take up this offer? What assurances can he give that the compensation being offered to those 86 individuals whose convictions have been overturned will be made up to a sufficient level? What can he say in response to the point that, if people go through the full scheme, the compensation will be much higher? I would be grateful if he addressed what he thinks the balance is between the figure of £600,000 and what others might expect to get. Importantly, what is the estimated timescale for compensation completion for those he considers eligible and not yet fully compensated? Finally, can the noble Earl explain why it has taken so long for evidence from key stakeholders—the Post Office, the Government and Fujitsu—to be presented to the public inquiry?

The Post Office is a national institution, but its reputation has been severely damaged by this scandal. I finally ask: what steps are being taken to ensure that this can never happen again?

[Lord Fox (LD)]

My Lords, I too thank the noble Earl for repeating this Statement. I recognise the good faith that the Under-Secretary of State in the Commons and the noble Earl have in trying to move this forward. As the noble Baroness, Lady Blake, said, this scandal is deeply shameful—one of the most deeply shameful incidents in public life, certainly in our lifetimes. It has involved lying, cover-up and deceit on an industrial scale and, to date, only the innocent have been punished.

Nevertheless, as I said, this announcement is a sincere attempt to inject some forward movement. As media reports have indicated, and as the noble Baroness set out, since the announcement, some of the victims will be freed from the need for an extensive claims assessment process through this offer. Others, some of the most egregiously harmed by this scandal, will rightly decline in anticipation of more appropriate compensation via a full assessment and, clearly, the Government have recognised this right, which is the right thing to do.

I sense and understand the Government’s frustration that only 86 out of an estimated 600 people who were damned by Horizon evidence have so far come through the process. Perhaps this new announcement will attract some people out, but I ask the Minister: what is plan B and what else are the Government going to do to try to inject further forward motion in this awful scandal? The process is grindingly slow and presents imposing challenges to people who have already been burned by their contact with the courts and the authorities. These are people who have been psychologically harmed by the system and now have to re-enter it to get recompense. Some element of psychological understanding has to go into coaxing these people to cross that line.

In the Commons, my honourable friend the Member for Tiverton and Honiton asked a very pertinent question regarding subpostmasters who were dismissed but not prosecuted. In his thoughtful answer, Kevin Hollinrake MP highlighted the complexity and difficulty of processing claims. This is the nub of the problem and why things are grindingly slow. It is complex and difficult, and things are taking so long. Already, people have died and more will die before they find justice. I understand that this announcement is driven by a desire to move things forward, but can the Minister please undertake to carry back to his department your Lordships’ frustration and plea for greater urgency and more energy to make this move forward?

I have a question, which perhaps the Minister can explain now or write to us. Do the victims in this process, which is complex, have to prove themselves innocent, or is the assessment the other way around? It seems to me much harder to prove innocence than to refute guilt. Perhaps one way of moving this forward is to change the bar that people have to clear in the assessment process, and make it clear to them that it has been lowered and made easier. Perhaps we are applying too rigorous a standard for people who were so unrigorously prosecuted in the first place.

The elephants in the room in this inquiry are the roles played by the Post Office and Fujitsu, as the noble Baroness, Lady Blake, said. Here, I think the Government have been found wanting. The Government moved on the issue of senior employee bonuses, for which they deserve some praise, but, seemingly unchastened by this overall story, the Post Office is still taking an obfuscatory stance with respect to providing evidence to the inquiry and moving things forward, and it continues to be allowed to do so. Secondly, can the Minister confirm that Fujitsu remains commercially untouched by this and continues to bid and win government contracts—and can he tell us why?

This is a welcome announcement, but it is one step and there is a long way to go, so please can the Minister, who I know is working with us in good faith, work with his colleagues to find new ways to speed it up and find resolution and at least some end to this sorry story?

[The Minister of State, Department for Business and Trade (The Earl of Minto) (Con)]

My Lords, I thank both noble Lords for their speeches, which were both very powerful and raised some extremely salient points on what I think everybody must agree is one of the most atrocious commercial situations that this country has experienced. Both the noble Baroness and the noble Lord are quite right: this is an extremely complicated situation and of course it goes back over a very long time now. Memories are fading and some of the financial data, which is critical to sorting out some of the issues, is not as fresh as it was and, of course, we have the terrible situation of individuals being not only prosecuted but jailed—and unfortunately some have even taken their own life, which is just beyond belief.

This is one of the very worst incidents in commercial history. When it comes to trying to support the victims wherever one possibly can, the Government are increasingly taking steps to not only get an appropriate amount of compensation into their hands but to encourage people to come forward, which seems to be one of the hardest things to do. For one reason or another, people who have been so badly affected by this situation are unwilling to come forward. The noble Lord, Lord Fox, made the extremely interesting point that it could be that proof of innocence is harder than proof of guilt, which of course is completely the wrong way round. I will certainly ask what the Government can do in relation to that, but this is an increasingly difficult situation to get to the bottom of.

Having said that, the offer of £600,000, free of any tax and with legal support if so required, for the individuals involved where their conviction has been overturned is a genuine attempt to make things much simpler and easier for those who find the whole process of going through the established claims procedure too challenging. This is an offer that is not conditional upon anything. My honourable friend Minister Hollinrake said “no ifs, no buts”—it is £600,000 tax free, and of course it is a full and final settlement. The clarity of it is absolutely simple. I hope that will appeal to certain people who may want to bring financial closure where possible. There is no doubt that it will not appeal to everybody. I am sure we have all read in the press this morning a number of stories of people who are talking about numbers which are considerably higher than this. It is right and proper that they should continue to press their case through the compensation channels that they have.

I will address some of the issues raised. I am afraid I cannot give a clear answer to every single one of them; some of them are extremely subjective and probably need a little more thought. I will certainly write where I have not addressed the issue.

The question of personal damages is a tricky one. The Government have already made interim payments of £21 million to 86 postmasters who have had their convictions overturned.

On how the £600,000 figure was reached, I am not absolutely clear. It is a huge step forward from what was available previously, but I will follow that up. From the point of view of the pecuniary amount, it is a significant amount of money. The offer that anybody who has already settled and who got less than £600,000 through the existing channels will be made good up to that figure is an honourable way of going about it. It is extremely important—I quite agree.

As to how many people will take it up, that again is a very difficult question to answer. As I am sure the noble Baroness knows, there are a number of these unfortunate individuals who have already employed lawyers and who are already into the process. I guess they have to be confident that the legal advice they receive will either allow them to pursue what they have started or take this offer. I am not certain that it is the Government’s role to get involved in that; I do not think that is the case. As far as the total amount goes, if everybody were to take it up, obviously that would be £600,000 per claimant, but my suspicion is that it will end up being a bit more than that.

As for the timescale, this offer is to make it simple and fast, for all sorts of reasons. As the noble Baroness said, this has been going on for an unacceptably long time. The attempt to make it transparent and simple is a genuine attempt to bring closure for as many people as possible.

The point about the Post Office, the Government and Fujitsu is very well made, and I will address that later, if I may.

Finally, on the point about it never, ever happening again, I do not think anybody would put their hand on their heart and say that something like this could never happen again, but one of the collateral benefits of a situation such as this is that it raises awareness. One has to go back a long time, but, as noble Lords may know, I was a retailer in my commercial life and the level of faith that one put in electronic point-of-sale equipment and the systems behind those front-facing things was, in the early days, at times ill-founded. One would think now that there are enough checks and balances within any form of automated stock control and management system that anything that does not look right would be flagged up—that is certainly my experience. I do not think that something as specific as what we have had to face through the Horizon scandal is likely nowadays with the advances in technology.

I will refer quickly to the comments of the noble Lord, Lord Fox. I am entirely with the noble Lord; this is a deeply shameful situation. I have stood here before and talked about the way that the Post Office runs itself; I do not think anybody can be in any doubt as to what I think some of its commercial failings have been. We have to look only at the extraordinary situation around the bonus payment, which has now been fully repaid; the chief executive has paid back more than he had to—slightly too little, too late, in my view, but at least it is an acceptance of failure. The Government are acutely aware of those issues.

As for damages through the courts, that is really a question for the courts. As I understand it, the legal advice that you get when you make a claim through the court—I referred to this earlier—is such that it is always an estimate. I imagine that, for some, it is absolutely obvious that they will continue to go through the courts, whereas for others that is not the case. The fact that the Government will make up the difference is certainly an honourable way to address that.

The question of those dismissed but not prosecuted is something that we need to address. I am again surprised, as I imagine are a lot of people, by the amount of people who have not applied and put their names forward. However, on the group litigation order, as of 15 September, 461 registration forms had been received and 32 full claims. Seven offers had been made and accepted. It shows that all these different opportunities are starting to gain some traction. It would be nice if we could get through them as quickly as possible.

I think that is probably it, apart from the elephants in the room—Fujitsu and the Post Office. The Government are keen to get this out the way and settled, before we see where we stand with Fujitsu. It is a core participant in the inquiry. It must now know what went wrong; well, it certainly did before we knew. Once the independent inquiry is complete, I am sure there will be a robust conversation with Fujitsu and, no doubt, its insurers.

I might finish on that. This has been a horrifying experience for a large number of people—well over 2,500—and the Government continue to do what we can.

--- Later in debate ---

[Lord Kennedy of Southwark (Lab Co-op)]

I want to pursue that point. The noble Earl said that people have been contacted. How have they been contacted? Is it a letter? Is it a phone call? Have you knocked on the door? Have you gone back again? We need to know what that contact is, because if people are not coming forward from that contact, then it has failed. People need to know that we accept that a great injustice has been done to them and we want to sort it out. The noble Earl may not be able to answer the point now, so will he write to me and to other noble Lords in the House to say what the method of contact is and what they are going to do when they have not got a response?

[Lord Fox (LD)]

Before the Minister answers that, it is important to bring home and build on the point made by the noble Baroness, Lady Falkner. A strategy to communicate with certain communities is different from a strategy to communicate with the mainstream community. It involves community leaders, different media and different things. Do the Government have a proper media communication strategy of the sort that was just mentioned that involves using community leaders as intermediaries for those people to give them the confidence to step forward?

I talked about the Post Office being obfuscatory. Among the things it was obfuscatory about were appalling racial slurs that were used to characterise those people. At the heart of this is a racial element, and we should not forget that. Many of the people who were punished may well have been singled out because of their classification within that process. I think the Government owe it to them to double down on this communication.

[The Earl of Minto (Con)]

I entirely agree. The Government really do owe it to them to double down on it and I will find out exactly what the situation is. I know that telephone calls, letters, victim meetings and all sorts of things are going on, and it is extremely important that we get to the bottom of it. I will write to noble Lords with the details and let them know exactly how we are proceeding.

Tata Steel: Port Talbot

Lord Fox Excerpts

Tuesday 19th September 2023 Lords Chamber

[Baroness Chapman of Darlington (Lab)]

Noble Lords will understand that there is deep concern about the loss of as many as 3,000 jobs in south Wales. It is important to remember that, for many communities, this is not happening for the first time. The areas of the country where steel making is still a significant industry are scarred by decisions made in the 1980s in the name of progress by Conservative politicians without any thought to the economic devastation or the need for alternative investment, and no understanding of the damage to community pride, sense of place and even long-term health of the people affected. Doing deals over the heads of local people and then presenting as a success an outcome that costs £0.5 billion of taxpayers’ money and 3,000 jobs, leaving us with only one blast furnace site in the UK and diminished capacity to make virgin steel, shows how arrogant, out of touch, lacking in strategy and blasé this Government have become.

There are some serious questions that the Government have so far failed to answer. First, why was this deal done behind the backs of the workforce and their representatives? Secondly, the electric arc furnace uses scrap steel, but this will not work for Trostre and Llanwern, so where will that steel come from in future? Will it come from India or Turkey? Thirdly, when will a grid connection for the arc furnace be provided? Fourthly, what specifically is the intention for the site? Fifthly, what is going to be done to support the workforce?

Green steel is something that we all support, including workers and trades unions, so the Government need to do much better in planning for transition because, if this mass job loss model becomes the norm, workforce and wider public support will vanish. Transition requires trust, detail, openness and the involvement of all interested parties, and the Government have failed Port Talbot. The most important question that the Government need to answer is simply this: do they accept that the ability to make virgin steel for our national security is strategically important and must be sustained? Will they guarantee that the UK will retain its ability to make virgin steel in future?

[Lord Fox (LD)]

My Lords, I thank the Minister for allowing us to debate this Statement. The noble Baroness from His Majesty’s loyal Opposition made some important points, and I associate myself with her remarks. I have some additional questions.

The agreement to fund the installation of new arc furnaces for steel making will have a positive effect on emissions, and that is good news. However, as the noble Baroness said, the package could mean as many as 3,000 job losses in the UK, and in one area of the UK. That is a terrible outcome.

Tata is reported as warning that there would be a

“transition period including potential deep restructuring”

at the plant. I am not sure that I understand what that means. Can the Minister please translate it for your Lordships’ House in real terms and real lives? Those jobs are being shed. What plans do the Government have to support those people and that local economy when the jobs go? What are the plans for retraining, for example? What are the realistic expectations for a concentration of new and different jobs in that area?

As we also heard, the electric arc furnaces deliver different grades and qualities of steel compared to what we get from a blast furnace site. What is the Government’s assessment as to how the new capacity in this country as a result of that will affect the profile of steel we need to import? To add to the point that the noble Baroness made, what is the assessment on resilience in this country as a result of this change?

The new coal mine in Whitehaven that was last year partially waved through by Michael Gove is also a factor here. West Cumbria Mining said that the coking coal that it would produce would be used for steel making in the UK and Europe. As the Minister knows, electric arcs do not use coke. Yesterday’s announcement removes at a stroke a large proportion of the domestic market for that mine, meaning that the mine will be almost solely for export only, which even further removes the legitimacy of that venture.

The Statement mentions that the British industry supercharger, aimed at assisting electricity prices and helping to make them competitive for energy-intensive industries, will be applied here. His Majesty’s Government responded to the consultation on this only on 5 September, so I suspect that this is its first outing. I really do not understand what it is, but it is cited in reports. Can the Minister please write to us outlining what it is and what it means? I saw the consultation on the British industry supercharger and the response to it, and it is cited as being applied here. How is it applied? What are the terms of that application and what does it mean in energy terms for this business? What other businesses are now in line to benefit from it—not least Scunthorpe, where the Chinese owners cited energy costs as the reason for their shutting down of its coking ovens?

I have a couple of other points. Tata expects to release land at Port Talbot for transfer or sale following the closure of the blast furnaces. This land presumably hosted high industrial activity for decades, so who will be responsible for the not inconsiderable costs of decontaminating and remediating this land before it becomes useful and valuable for anything else? Who will be stumping up these costs?

In conclusion, we have seen a number of government interventions, including the also Tata-owned Jaguar Land Rover, Nissan, BMW and perhaps, going forward, British Steel. It has been said by some that these are foreign investors who are masters at extracting subsidies. We understand that there is an international subsidy competition going on here, but how does the Minister respond to that charge? The Chancellor has said that he was not prepared to go toe to toe with the US and EU in the subsidy bidding war, but this looks like the Government reacting to things when they settle in their in-tray. A patchwork of deals is a poor substitute for a coherent industrial strategy. Where is His Majesty’s Government’s plan? What are the Government seeking to cause to happen, or should we expect further examples of sticking plaster activity?

[Lord Anderson of Swansea (Lab)]

My Lords—

[The Minister of State, Department for Business and Trade (Lord Johnson of Lainston) (Con)]

Apologies, my Lord. I think I have the opportunity now to respond to the two opening speeches and then I will answer questions one at a time, if I have the order correct.

I greatly appreciate the debate we have had so far over what I believe is a pretty sensational recovery of an extremely difficult situation. Noble Lords will be aware that these conversations around Port Talbot have been going on for many years—some say even more than a decade. Certainly, from my own experience in the private sector, I regarded the situation with a great degree of pessimism, to be frank, and I am surprised that the tone of the debate is not more positive. That does not negate the realities of saving the situation and the transformation that will result in the locality.

I will go through the points raised by the noble Baroness, Lady Chapman. I am happy to answer them one by one because we have a strong and coherent policy response to each of the very important points raised. This is a very serious issue. We are not playing politics here; we are dealing with people’s lives and the important commitment of, I believe, all of us in this House to maintain steel production in Port Talbot and to guarantee a future for those communities. What we have ended up with is a powerful opportunity for this country to reshape its industrial base in terms of producing steel and reducing emissions. Noble Lords will be aware of the astonishing level of emissions that Port Talbot alone produces; I think it is 1% of our entire national output. If we are serious—and I think, collectively, we are—about reducing carbon emissions, to reduce one site that produces 1% of the emissions by 80%, which is what this outcome will produce, is significant for the collective challenge we are presented with.

I also find, if I may say so to noble Lords in this House and to the noble Baroness, Lady Chapman, and the noble Lord, Lord Fox, that there is an opportunity to shift. This is a business case—so it is subjective and perfectly reasonable to raise it—for virgin steel, whereby we import the ore, at great cost to emissions and national resilience, and recycle the nine or 10 million-plus tonnes of scrap. This presents an opportunity to us, to Port Talbot, to the people of Wales and to the whole country to realign our steelmaking industry—to rightly make the most of this scrap steel, which otherwise is being exported to Turkey or the US to be recycled. We were losing out on an enormous opportunity to be part of the circular economy.

Let us look at the prima facie business case for what the Government have done, to work in partnership with Tata. I put on record my personal thanks to the leadership of Tata for the extraordinarily good tone of the negotiations that I know it engaged in. From my first meeting with the chairman of Tata a year ago—although I was not involved in these specific negotiations —there was a very clear signal that Tata felt it was important that it reflected its family ownership in terms of commitment to the community of Port Talbot and the United Kingdom. I hope all noble Lords will join me in expressing thanks for the intense amount of good will demonstrated.

The Government have been extremely brave and forward-footed in bringing forward a proposal that will enable us to transform this site, reduce our emissions and, through the transformation to the Celtic freeport projects and the work we shall do—the noble Lord, Lord Fox, rightly raised this—in releasing land that is currently either potentially contaminated or has risk around it, create up to 16,000 new jobs. The noble Baroness, Lady Chapman, is right to call back some of the policy decisions taken in the 1980s, when there probably was not enough sensitivity paid to the transformation process, which affects people but ultimately makes us safer. That is why the Government have been extremely aware of and sensitive to this crucial point that affects people’s lives. Working with Tata—again, a private enterprise—we have created, or are in the process of establishing, a £100 million fund specifically to look after the communities and the people affected. I am aware that specific task forces are being set up to ensure that the process can be properly handled.

There is a reasonable case to be made by noble Lords, although I do necessarily agree with it, about the process by which this announcement was made, but I am sure all noble Lords who have been involved in sensitive and complex commercial negotiations will be aware that the specific terms cannot be entirely public. It was quite right that we got to a good decision, rather than one jeopardised by too much general community discussion. However, as the noble Baroness, Lady Chapman, will know well, as will her colleagues on the Front Bench, these discussions have been going on for a very long time. Indeed, the announcement of electric arc furnaces at Port Talbot really should have brought great relief to many people, because the worry in the air was that a far more jeopardous decision would be made.

This gives us an enormous opportunity to restructure our industry and reduce our emissions, which is a core commitment of all sides of this House and this Government. It gives us an opportunity to reinvent a huge site with great potential, creating tens of thousands of jobs. I have tried to take a much more positive view of what is a wonderful partnership between the Government, private enterprise and the community that will safeguard thousands of jobs, when the risk of losing those jobs was so significant.

I am aware that both the noble Baroness, Lady Chapman, and the noble Lord, Lord Fox, asked me specific questions, which I am sure other noble Lords would like answers to. If the noble Baroness will allow me, I will just cover those points I did not cover in my main speech. There is an issue over virgin steel. The noble Lord, Lord Fox, suggested that we guarantee always to have a capacity for virgin steel.

[Lord Fox (LD)]

I did not say that; I just asked what the assessment was.

[Lord Johnson of Lainston (Con)]

I apologise. The noble Baroness, Lady Chapman, asked whether we would guarantee to make virgin steel strategically important. It is not my place at this Dispatch Box to make such industrial guarantees. However—again, I am happy to take advice from experts—the arc furnaces being installed at Port Talbot are far more sophisticated, I am told, than current arc furnaces in scale, sophistication and the quality of the steel they can produce. They will produce, even on the current plans, steel very close to the quality that we require for all our steel needs.

Think of the automotive sector. Port Talbot provides half of all sheet metal for the automotive sector in the UK. That can still be provided. Think of railway track. That, I am told, can still be provided using these processes. We will be importing the necessary steel to produce cans and other specific steel that requires virgin steel, but we believe that over time—this is where the technical debate comes into play—we can produce the same quality of steel that is hoped for to enable us to ensure that we have resilience in that area.

I was asked about the supply of green energy. I assume that linked to that is a question about connectivity and pace of change. We are in discussions with National Grid, Tata and other agencies to ensure that can be done as soon as practically possible. The process that has led up to this very celebratory announcement has been going on for some time and there has been a great deal of planning. I do not have a specific date but the assumption is that everything will go on track in terms of the supply of green energy, grid connectivity, the decommissioning of the blast furnaces and the introduction of the electric arc furnaces.

I believe there was a question about support for the workforce, which I hope I have covered. In his comments the noble Lord, Lord Fox, raised the situation of the Whitehaven mine. There was never an indication by Tata that it was going to use the coking product from that mine, so I cannot answer further than to say that that was never in the expected plan, whatever the outcome was. I am happy to look further into the export possibilities of the mine, but I do not think that is necessarily relevant today.

The British industry supercharger is a follow-on policy to support energy-intensive industries and make sure that they can compete. I am happy to write to the noble Lord on the specific number of companies that qualify. It is not a huge number; it is quite a specific number of heavy energy users that we are supporting to make sure that they can compete on an international scale. I think all noble Lords would agree that it is very important that we continue to provide that type of support.

I have two final points. I have covered the decontamination point briefly; one of the very important elements of the decision-making around this process was why we could not simply sell the site to a third party. I asked that question myself. The reality is that there are so many complexities around the site, including decontamination and the liabilities that the Government would have had to undertake, that this is genuinely the most effective way to retain as efficient a support level from the Government as possible—not to oversubsidise or oversupport—while at the same time ensuring that the company is viable and can be successful. I mean this in a heartfelt and sincere way. We can deal with the significant issues that those sites present, and at the same time it will have the knock-on effect of using the land for the amazing regenerative opportunities of the Celtic port plan.

On my last point, I thank the noble Lord, Lord Fox, for raising some of the great successes over the last few months. I have been proud to be part of the department that has delivered these successes, such as the announcement a few months ago of the Tata gigafactory, one of the largest buildings ever to be built in the history of this country, maybe even the largest, and one of the biggest investments ever in the car industry; the announcement that Stellantis are going to build Fiats, Peugeots and Citroëns in Ellesmere Port after significant consideration of whether or not it wanted to base their production facilities in the UK; and the announcement last week that BMW is going to—again, after significant consideration—build its electric Minis in this country. Further announcements from companies such as Nissan on its capacity to build cars will ensure that this country has a strong industrial base.

I am very proud of what we have managed to achieve. They are true public/private partnerships. We are asked whether we have a strategy. The strategy is: we want a strong industrial base in this country and, if I may say so, we are delivering it.

Employers: Fire and Rehire Tactics

Lord Fox Excerpts

Thursday 14th September 2023 Lords Chamber

[Lord Offord of Garvel (Con)]

Throughout the course of this Parliament, commitments have been made around the manifesto commitments on employment given by the party on this side of the House. Over the last Parliament, six Private Members’ Bills have been brought through to enhance and protect workers’ rights. As I said, we are trying to strike the balance between workers’ protection and employers’ flexibility.

[Lord Fox (LD)]

My Lords, in answer to my noble friend’s question about P&O Ferries, the Minister rightly characterised its behaviour as an illegal act. However, P&O Ferries is now economically active and out there, doing what it always did. Will the Minister undertake to do an analysis of the turnover and profit of P&O Ferries now versus the sanctions it received? If those sanctions prove to have been insufficient, as I believe they will, will the Minister undertake to increase them to prevent a repeat of that disgraceful activity?

[Lord Offord of Garvel (Con)]

My understanding is that the P&O case is still under consideration with the insolvency authorities, so I cannot comment further on it. Further consultation is going on, taking account of this case and specifically the difference between dismissal and redundancy. That will also be in the code of practice. P&O has received censure. It continues to operate within the laws of the United Kingdom and should be allowed to continue to do so.

Small and Medium-sized Enterprises: Interest Rates

Lord Fox Excerpts

Wednesday 13th September 2023 Lords Chamber

[The Earl of Minto (Con)]

I entirely agree with my noble friend about the very good news about the economy. The EIS and SEIS schemes, along with VCT, have been enormously popular and successful, with over £40 billion being invested since their inception in 1994. We are assured by the Chancellor that the Government are committed to their renewal. We absolutely recognise the need for investors and companies, so that investment continues without interruption going forward. My noble friend will understand that I cannot give exact timings today, but the details will be provided by His Majesty’s Treasury ahead of the renewal date. On the European clauses, I ask your Lordships to understand that the Chancellor will have in mind that any renewal is for UK business only and no longer for the wider European audience.

[Lord Fox (LD)]

My Lords, on 17 July the Financial Times reported that the Prime Minister was convening a new business advisory council, bringing together senior bosses to shape government policy. The paper lists

“AstraZeneca, NatWest, BAE Systems, SSE, Google DeepMind, J Sainsbury, Vodafone, GSK, Aviva, Shell, Sage, Taylor Wimpey, Diageo and Barclays”.

That does not leave much room for the SMEs to get their message across, but it does typify the big business approach taken by this Government. Will the Minister confirm who is on this council, whether it has met yet, and how he expects small and medium-sized businesses to be able to catch the Prime Minister’s ear in such company?

[The Earl of Minto (Con)]

The noble Lord makes a very good point. Those are some of the largest international companies in the world, and I am sure that they will provide the Prime Minister with some extremely helpful advice. Having said that, as we all know, in this country the vast majority of businesses are small and medium-sized enterprises. In my role, I communicate with them almost constantly, both individuals and representative bodies. The value they have to add to these sorts of fora should not be underestimated. They are an extremely valuable and successful part of our economy.

Economic Crime and Corporate Transparency Bill

Lord Fox Excerpts

Consideration of Commons amendments
Monday 11th September 2023 Lords Chamber

[Lord Garnier (Con)]

My Lords, I had the privilege of being a member of the noble Lord’s committee. I agreed with what he had to say then, and I agree with what he has just said now.

[Lord Fox (LD)]

My Lords, in his opening dispatch the Minister praised those involved for the way in which the Bill has been modified and changed. The noble Lord, Lord Agnew, needs to take a lot of credit for how that modification has gone ahead, and the work that he has done and will have to continue to do in his role overseeing the Government’s response to this. I will not repeat anything that has already been said, other than to say that I agree.

The reason we are concerned about this issue is that the Government will rightfully say that they know who the names are in these trusts, but the issue we are talking about is the publication. It has been the role of civil society and journalists to uncover problems, and that has been very important in issues around this. If the Government can demonstrate that their commitment to enforcement, getting behind these trusts and exposing people who are using them to avoid issues is fully funded and fully backed by them, our relying on civil society—which we have had to do to date—would be less of an issue. That is why we support the quest by the noble Lord, Lord Agnew, on this, and will support him as he seeks to make sure that further steps are appropriate and that enforcement is at the heart of what we seek to achieve here.

[Baroness Blake of Leeds (Lab)]

My Lords, I start by thanking the Minister for the broader tidying up of the amendments in this group and by reflecting on the time, over several months, that we have been discussing these important issues. We must keep our eye on the scale of the issues that we are dealing with; they are immense, and they cost this country billions of pounds. We have a great deal to do to repair the UK’s reputation in the world, and I hope that we involved in this debate will all have our eyes on that prize.

I am pleased to say that we have seen some positive changes achieved through the passage of this Bill and a genuine appetite for change, as we experienced with our conversation with Companies House. We are going through an immense cultural change in the management of these affairs. As we know, it is the biggest shake-up for 170 years. I also pay tribute to everyone in the Chamber, and those who are not here today, for their diligence in the work that they have done, and to my colleagues in the other place, Dame Margaret Hodge and Seema Malhotra in particular. Months and months of work have gone into getting us to this place.

I am very grateful for the explanation that the noble Lord, Lord Vaux, gave. There is real recognition that there will be an ongoing need to scrutinise. I think we all accept the commitments in good faith, but we need to make it clear to Ministers and their officials that the interest is very live and that there will be close scrutiny as these matters roll up. Compromise has been reached on this—I accept that that is the reason we will not be taking the amendment to a vote—but we add our support to the ongoing scrutiny that will need to take place.

I also pay tribute to the noble Lord, Lord Agnew, for his persistence in this and his unique position having had experience in government, which has informed the approach he has taken and the concern that I think many would agree he has rightly raised. We are where we are—he has decided to accept the reassurances—but we also have an insight into those elephant traps that he referred to. I also reference the comments of my noble friend Lord Eatwell on the explicit need for vigilance.

With those comments, and thanking everyone for the spirit of compromise, I reassure everyone that we will look closely at this, and we very much hope that the measures being brought in today will be sufficient. We will look to those delegated powers that have been built in to make sure that, if change is necessary, it will indeed be made.

--- Later in debate ---

[Lord Hope of Craighead (CB)]

My Lords, I am greatly assisted by the correction made by the noble Lord, Lord Faulks; I had great difficulty in understanding the amendment on first reading. Now that he has corrected it, I would like to say from the point of view of a Scots lawyer that there is nothing startling in the proposition that is made. We in Scotland are quite used to the normal routine that law enforcement agencies are not liable in costs for the proceedings that have been taken, probably for the reasons that the noble Lord has clearly expressed.

[Lord Fox (LD)]

My Lords, we have benefited from two extremely detailed and learned speeches proposing Motions E1 and H1. On Motion E1, I am exercised by the idea that there is an opportunity cost in checking whether you are preventing or causing fraud. That seems to be a strange discussion. The analogy made by the noble and learned Lord, Lord Garnier, with HSE and health and safety, is a good one: yes, it is a cost to make sure that you are doing something safely but it is a much wider benefit. The notion that 95% to 98% of the business community should be allowed not to consider their impact on fraud because that would get in the way of their growth is strange, because that growth would then be predicated on very shaky circumstances. I am not persuaded by the counterarguments, but I have been persuaded strongly by the noble and learned Lord.

Similarly, on the Motion from the noble Lord, Lord Faulks, causing agencies to be too tentative and restricted in how they go about prosecuting people is an important issue. It is clear from what we have heard from the outside world that this gets in the way of prosecutions. It also causes the prosecuting authorities to go for low-hanging fruit—that is, easier propositions—and avoid harder and often more severe prosecutions. That is a chilling effect which we should be worrying about when we look at this issue.

These two important amendments have been trimmed in the light of the rejection of the last set by the House of Commons. Noble Lords and Baronesses on these Benches will be happy to support them, if and when they are moved to a vote.