Royal Mail
Lord Hunt of Wirral Excerpts(5 days, 10 hours ago)
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Lord Stockwood (Lab)
As I said in my previous answer, this was highlighted as an issue to the new investor. The Royal Mail has introduced a barcode system to optimise the delivery of NHS letters at times of local and national disruption, but it is beholden on all NHS bodies and providers to use this system. I ask all Members of the House to encourage their local NHS, where they interact with senior leadership, to take up this service. It is a technological solution that can prioritise those urgent and critical letters from the NHS, and this should provide certainty that the delivery will get there and not be in jeopardy.
Lord Hunt of Wirral (Con)
I will start by congratulating the Minister on the hard work he has carried out in preparing for this Question, and in particular the discussions he has been having with Royal Mail. However, does he not accept that, by increasing national insurance contributions, which I reckon adds around £120 million to the costs of one of Britain’s largest and most labour-intensive employers, the Government have made it significantly harder for Royal Mail to restore service standards, maintain the universal service obligation and invest in those improvements that customers and businesses expect?
Lord Stockwood (Lab)
I appreciate the comment on my hard work—it is now noted. I cannot agree with the noble Lord on that particular point. It is unfair to think about an individual tax application on the investment in this specific case. There is £500 million of committed capital from the new investor, EP Group, and that is a non-trivial undertaking that has been committed on an £8 billion business. At the moment, we are proud, as a Labour Government, that we are shoring up the fiscal rules and the economic prospects of this country, so that we can invest in the public services that we rightly believe we need to.
Business Hiring
Lord Hunt of Wirral Excerpts(1 week, 5 days ago)
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Lord Hunt of Wirral
To ask His Majesty’s Government what assessment they have made of current business hiring intentions and their implications for the wider economy.
The Parliamentary Under-Secretary of State, Department for Business and Trade and Department for Science, Innovation and Technology (Baroness Lloyd of Effra) (Lab)
The UK labour market and economy remain resilient despite geopolitical uncertainties. The UK had the fastest growing-economy in the G7 in Q1 2026. On the labour market, ONS data shows that there are 416,000 more people in work than a year ago. Its business insights survey shows that over 80% of businesses intend to either maintain or increase their staff levels in June 2026.
Lord Hunt of Wirral (Con)
I greatly regret to tell the House that the latest figures from the Office for National Statistics show that the number of young people not in training, education or employment has exceeded 1 million. I believe we are heading to figures for 18 to 24 year-olds which have not been seen since 2008 when, under the previous Labour Government, the future looked very grim. Recent measures were introduced by the Government, including the business-busting Employment Rights Act, the national insurance contributions—the list is endless, and if noble Lords would like to read them all, they are in the report of the unemployment adviser, Mr Alan Milburn, or the essay published by the previous Prime Minister. Will the Minister wake up and do something about this?
Baroness Lloyd of Effra (Lab)
I do not accept the characterisation presented. We recognise there is a crisis of participation, and Alan Milburn’s interim report clearly laid out many of the contributing factors in health and education, which have been there for many years. Under the previous Government between 2021 and 2024, the number of young NEETs increased by 250,000. This is an issue that we are tackling. As I mentioned, in Q1 of 2026 the economy was one of the fastest-growing in the G7. We are taking actions on youth employment, supporting young people to get into work, supporting them with work experience, training and apprenticeships. This is exactly what we need to do in these circumstances.
Processed Russian Oil Products: Sanctions
Lord Hunt of Wirral Excerpts(3 weeks, 2 days ago)
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Lord Hunt of Wirral (Con)
My Lords, the Minister may not have been in the Chamber earlier, but I hope she has been made aware of the concerns expressed by the noble Lord, Lord Rooker, and my noble friend Lord Gove about the fact that the Government are now permitting the importation of Russian-derived oil products into the United Kingdom. I quoted the Ukraine sanctions commissioner directly. He said that, in his view, the Government’s action
“may still generate additional revenues for Russia’s war machine”.
It would be helpful to know what the Minister’s response is to that commissioner. Simultaneously, the Government are also blocking new North Sea oil and gas licences on our own doorstep. With thousands of skilled jobs, billions in tax revenues and our national security all hanging in the balance, will the Minister explain to this House why the Government’s energy policy is rendering this country more exposed, not less, to hostile foreign actors and volatile global markets?
The Parliamentary Under-Secretary of State, Department for Business and Trade and Department for Science, Innovation and Technology (Baroness Lloyd of Effra) (Lab)
My Lords, I want to make it clear that our sanctions regime against Russia is tougher today than it was last week. It is categorically not the case that we are waiving or easing sanctions. On 19 May the Foreign, Commonwealth and Development Office laid the Russia (Sanctions) (EU Exit) (Amendment) Regulations to legislate for several key measures to continue to tighten our pressure on Putin’s regime. These regulations include a new maritime services ban on Russian liquefied natural gas, which will restrict Russia’s access to the UK’s world-leading shipping and insurance services, disrupting its ability to transport Russian LNG. It further includes export prohibitions against Russia, as well as new import prohibitions to restrict the transfer of any refined oil products derived from Russian crude oil and of the import of Russian uranium. As has regularly been the case for sanctions on Russia for several years, targeted short-term licences have been introduced for our LNG maritime services ban and the refined oil import ban in order to support flexibility in UK supply in global markets.
We have made it clear here, and the Minister for Trade made it clear in the House yesterday, that these licences are temporary, will be reviewed regularly and are not intended to protect Russian interests. The sanctions regime today is tougher than it was last week. In respect of the lessons of this crisis for energy security and for the UK’s reliance on foreign fossil fuels, the lesson that we are taking is that we need more homegrown renewable and nuclear energy. We need to continue the decarbonisation so that, for example, with the transition to electric vehicles, we are less reliant on overseas imports of energy.
Self-employed: Paternity Leave
Lord Hunt of Wirral Excerpts(3 weeks, 3 days ago)
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Baroness Lloyd of Effra (Lab)
The costs of all the schemes that are being suggested and the potential expansions of rights, whether for self-employed fathers or mothers, will be considered. We have taken into account the costings that have been put to us by some of the groups that are advocating for these measures, and we are assessing the full costs of these as part of the review.
Lord Hunt of Wirral (Con)
Does the Minister not accept that the real problem is that employment costs are rising to such an extent that it is now much more difficult for businesses to offer enhanced paternity leave and other support for working parents? Will she consult with her colleagues and bring forward a clear strategy to reduce business costs, so that more employers and self-employed parents have the flexibility to support families when a new child arrives?
Baroness Lloyd of Effra (Lab)
I am pleased to take this opportunity to say that the UK had the highest growth in the G7 in the last quarter. I am also pleased to highlight the measures we are taking to reduce costs on business—for example, ending mandatory strategic reports. I am also pleased to talk about the measures we are now taking to support families with the cost of living, be it energy costs or expanding free school meals.
Steel Sector
Lord Hunt of Wirral Excerpts(1 month, 3 weeks ago)
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Lord Stockwood (Lab)
I thank my noble friend for her question. The issue of grid connections partly sits in my department; the House might be interested to know that we have 800 gigawatts of demand in new projects to 60 gigawatts of supply. Grid connections and making sure that the grid is fit for the future will be a massive part of what we do. We also have a prioritisation process that helps prioritise the highest value projects, not just economically but socially. I would be happy to update the House on that.
As to the “Save our Steel” campaign, it is worth stating that the steel factory in Scunthorpe is close to where I grew up and I have many friends who work in the industry. I commend that organisation and the work that it does in ensuring that we do not lose sight of the fact this is not just an economic story for the UK but about real lives and communities. The work it has done has been excellent.
Lord Hunt of Wirral (Con)
My Lords, the Government’s steel strategy and procurement guidance require all government departments to consult UK Steel’s digital catalogue and consider whether the national security exemption in Schedule 2 to the Procurement Act 2023 applies. However, at the same time, the Government are asking the Ministry of Defence to find £3.5 billion in savings, even as our Armed Forces are being asked to prepare for a far more dangerous world. In the circumstances, does the Minister agree that this is a wholly perverse bureaucratic requirement to place on the MoD? If the Government truly accept that national security must now come first, will they exempt the MoD from these domestic steel procurement requirements so that it can source steel rapidly?
Lord Stockwood (Lab)
The noble Lord raises a critical question around how we balance the national resilience of our steel industry with security concerns; that balance is paramount. We remain in conversation with the MoD about making sure that this does not have a prohibitive impact on its procurement and access to products. Equally, it is really important that we utilise the UK Government’s procurement processes to ensure that we are prioritising UK products and services to meet the demand of all our government departments. There are a number of initiatives working on procurement, but I agree that we need to make sure that that perverse incentive does not drive the wrong behaviours.
Britain’s Battery Future Report
Lord Hunt of Wirral Excerpts(2 months ago)
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Baroness Lloyd of Effra (Lab)
The noble Lord is right to highlight the importance of the EU as the largest market for UK-manufactured cars. The EU remains the UK automotive sector’s largest trading partner. We are talking closely with the EU on all aspects of regulatory developments in respect of EU battery rules, the EU digital battery passport and the “Made in Europe” content rules, because we want to continue to press the EU to avoid any detrimental impact on the UK and EU’s automotive sectors, given the integrated UK-EU supply chains.
Lord Hunt of Wirral (Con)
My Lords, according to the Society of Motor Manufacturers and Traders, the Government’s EV mandates imposed an industry-crushing £6 billion-worth of costs on manufacturers in 2024 alone. This is putting the 183,000 jobs which this sector supports at considerable risk. If the Government want the EV transition to endure, surely, they must proceed at a pace that industry can bear. Is it not now time to reverse these mandates, as the Official Opposition, I am happy to confirm, are committed to doing? Can we not now bring industrial policy back in line with economic reality?
Baroness Lloyd of Effra (Lab)
We are monitoring the performance and efficacy of the ZEV mandate and last year we introduced additional flexibilities, providing manufacturers with more tools to decarbonise in a way that protects jobs and boosts investment. We have a large range of measures to support people to transition to zero-emission vehicles, including salary sacrifice schemes, generous company car tax rates for electric vehicles and the new electric car grant, as well as support for local EV infrastructure to support the transition.
Companies: Online AGMs
Lord Hunt of Wirral Excerpts(2 months, 3 weeks ago)
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Baroness Lloyd of Effra (Lab)
All noble Lords and the noble Baroness have raised the importance of AGMs. They are incredibly important. They are important for engaging shareholders, large and small, but particularly, as has been mentioned, those who perhaps do not have an institutional voice. We are engaging with investors and the shareholder representative organisations on what the shareholder safeguards should be, so that will be taken into account in the consultation.
Lord Hunt of Wirral (Con)
My Lords, one of this country’s greatest strengths is our financial services sector and yet many of our firms face unnecessary regulatory and administrative burdens that make it so much harder to focus on their primary duty, which is to shareholders. In the light of the Government’s commitment to cut regulation by 25%, and given those additional pressures that businesses already face from higher employment costs and growing compliance demands, will the Government now set out what specific steps they will take to reduce the regulatory burden on financial services so that this vital and growing sector can deliver better value for shareholders, attracting investment and economic growth?
Baroness Lloyd of Effra (Lab)
As the noble Lord mentioned, getting the right regulation and reducing the administrative costs is a priority for the Government and in many areas we have already taken action to do that; for example, we no longer require certain companies to produce a strategic report. We will continue to work through the sectors and across all companies on reducing those administrative costs.
Foreign Direct Investment
Lord Hunt of Wirral Excerpts(3 months ago)
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Lord Hunt of Wirral
To ask His Majesty’s Government what steps they are taking to incentivise foreign direct investment into the United Kingdom.
The Minister of State, Department for Business and Trade and HM Treasury (Lord Stockwood) (Lab)
My Lords, this Government are firmly committed to ensuring that the UK remains a leading destination for foreign direct investment. We are strengthening stability and certainty for investors, advancing planning reforms to unlock growth and championing our globally competitive sectors. Working closely with partners across the nations and regions, we are developing a clear, investable opportunity, so that inward investment supports productivity, high-quality jobs and long-term sustainable economic growth throughout the United Kingdom.
Lord Hunt of Wirral (Con)
My Lords, we all want to see more inward investment, yet the figures on the Minister’s departmental website show a fall of about 12% over the last year. We hear from those businesses that are thinking about investing in the UK that they are very concerned about the £1 billion in additional costs that were imposed on business under the Employment Rights Act. There is now talk of the trade unions pressing for another employment rights Act, which would impose even more burdens on business. What is the Minister going to do about this?
Lord Stockwood (Lab)
The reason I have come into government is to try to balance the need to grow our economy with making sure that our economy works for all sectors and parts of our country. Creating an economy that delivers for businesses and for working people requires some changes. To put these into perspective, total annual employment costs in the UK were £1.4 trillion in 2024, and the costs associated with the Act that the noble Lord mentioned are equivalent to an increase of less than 0.1% of that. Those reforms are not about burdening businesses for the sake of it; many employers already offer good terms and conditions that go well beyond what the law requires, and will consequently be less impacted by this package. The Act is designed simply to help level the playing field, so that responsible businesses and employers cannot be undercut.
Employment Rights Act 2025 (Investigatory Powers) (Consequential Amendments) Regulations 2026
Lord Hunt of Wirral Excerpts(3 months ago)
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The Parliamentary Under-Secretary of State, Department for Business and Trade and Department for Science, Innovation and Technology (Baroness Lloyd of Effra) (Lab)
My Lords, this instrument makes consequential amendments to the Investigatory Powers Act 2016 following Parliament’s decision in the Employment Rights Act 2025 to create the Fair Work Agency, and brings together the functions of the Gangmasters and Labour Abuse Authority, the Employment Agency Standards Inspectorate and HMRC’s national minimum wage enforcement teams. It ensures that officers performing the same GLAA-derived criminal enforcement functions will continue to have access to the same investigatory tools under the same statutory thresholds and safeguards once they sit within the new agency.
Where the GLAA is currently named in the Investigatory Powers Act, these regulations update that reference so that the Department for Business and Trade, in so far as it relates to the Fair Work Agency, is listed instead. All of the underlying safeguards in the IPA, including the statutory requiring purpose, the minimum 12-month sentence threshold and the requirement for necessity and proportionality, remain exactly as Parliament originally set them.
I fully appreciate that the powers to acquire communications data are intrusive and must be used only when necessary and proportionate. These powers concern the who, when and where of a communication—that is, subscriber details, timings and location data—but not the content of any call, message or email. They do not reveal what a person said or wrote. They remain significantly less intrusive than interception, yet they are vital tools in tackling the most serious forms of labour exploitation, where victims are often too frightened, too isolated or too controlled to come forward with evidence.
It may help the Committee if I explain the scope of these powers. Under the Investigatory Powers Act, communications data authorisations will be able to be given to the FWA only for the purpose of preventing or detecting serious crime. This is defined in primary legislation, and one of the key elements is that the offence must carry a sentence of at least 12 months’ imprisonment; that statutory threshold remains unchanged. We need to ensure that the Fair Work Agency can continue to investigate the same serious exploitation offences, including unlicensed gangmastering and modern slavery, that the GLAA handles today. Those offences already meet the existing statutory definition of serious crime, and therefore fall within the same communications data authorisation framework, applying the same necessity and proportionality tests and the same independent scrutiny as before. The threshold, authorisation process and full oversight of the Investigatory Powers Commissioner remain exactly the same.
In transferring these functions to the Fair Work Agency, we have ensured that the safeguards that apply under the Investigatory Powers Act will continue in full. Communications data applications will remain subject to independent scrutiny by the Investigatory Powers Commissioner’s Office, including routine inspections and case sampling. The established single-point-of-contact system will continue to play its gatekeeping role, with an accredited specialist assessing every request to ensure that it meets the statutory crime purpose and satisfies the stringent tests of necessity and proportionality. Requests will still require authorisation by a designated senior officer at the appropriate grade and will continue to be submitted for approval by the Investigatory Powers Commissioner’s Office, with only limited provision for urgent internal authorisation.
The Fair Work Agency will operate in full compliance with the communications data code of practice, ensuring that standards of record-keeping, error reporting and handling of sensitive material remain exactly as they are today. In short, the framework of safeguards that Parliament has already put in place remains completely unchanged. The change made by this statutory instrument is the updating of the public authority’s name, ensuring continuity of capability following Parliament’s decision to transfer the GLAA’s enforcement functions to the Fair Work Agency.
The GLAA has always used these powers sparingly. Historically, the number of communications data applications has been modest and focused on a small number of the most serious investigations, often concerning organised criminal exploitation, threats of harm or potential trafficking. That discipline of “last resort” use and that culture of necessity and proportionality will continue in the Fair Work Agency.
On implementation, the Fair Work Agency will bring together three regulators into a single recognisable body, making the system easier for workers to navigate and clearer for responsible businesses. This consolidation will not dilute expertise. Existing GLAA specialists will continue to carry out GLAA-derived criminal enforcement with the same training, oversight and legal powers. Early operational arrangements, including access controls and internal governance structures, will ensure that only appropriate officers can apply for or authorise investigatory activity.
On transparency, the Investigatory Powers Commissioner will continue to report annually on the use of these powers, providing Parliament with a clear overview of how these powers are exercised. In addition, I can confirm to the Committee today that the Fair Work Agency will report on its use of the Investigatory Powers Act powers in its annual report. This will allow Parliament to see clearly that use continues to be confined to GLAA-derived criminal investigations, just as today. We will reflect this commitment in the Fair Work Agency’s framework agreement and in its enforcement policy statement, in line with good practice.
This statutory instrument is essential housekeeping. It prevents an unintended and undesirable drop in capability during a period of organisational transition and ensures continuity in tackling serious labour exploitation while keeping all of the guardrails that Parliament put in place firmly intact.
Lord Hunt of Wirral (Con)
My Lords, the instrument before us is, on the face of it, a technical one. As the Minister explained, it ensures that enforcement officers of the new Fair Work Agency inherit the same communications data powers, under the Investigatory Powers Act 2016, that officers of the Gangmasters and Labour Abuse Authority held before them. However, the creation of the Fair Work Agency is the moment at which this Committee confers covert investigatory powers on a body whose structure, resourcing and operating principles remain, to a troubling degree, undefined.
I turn first to what I regard as the most fundamental concern: the departure from the settled policy of targeted, sector-specific enforcement. The GLAA was created for a reason. It was designed to address the specific and acute vulnerabilities of workers in agriculture, food processing, shellfish gathering and related sectors—industries where the risk of exploitation and labour abuse was demonstrably high and where ordinary enforcement mechanisms were plainly insufficient.
The Fair Work Agency sweeps that away. It appears that it will have a broad mandate to inspect any business in any sector at any time. That is a significant departure; we were given no adequate explanation for it during Committee or Report on the Employment Rights Act 2025. On what evidential basis have the Government decided that the enforcement problems, which were previously confined to high-risk sectors, now require a body with universal reach? What assessment has been made of the risk that this broader mandate will dilute the quality and focus of enforcement, rather than improving it? The Minister just mentioned a framework agreement, but am I not right in saying that this Committee has not yet seen even a draft of it? Perhaps the Minister will clarify that aspect.
This matters acutely for small and medium-sized enterprises, which are already facing more than £600 million in costs flowing from the Employment Rights Act—costs that are, in large part, administrative in nature, such as in record-keeping, compliance processes and reporting obligations. These activities will now fall within the Fair Work Agency’s line of sight. These businesses, many of which are without dedicated human resources functions or legal support, will be exposed to an agency that is armed with powers of entry, powers to seize documents and electronic records, and now, through this instrument, powers to obtain communications data covertly. What guidance will be issued to ensure that enforcement action against small businesses is proportionate? What safeguards exist to distinguish a genuine, minor administrative error from deliberate wrongdoing? Will businesses that make honest mistakes face the prospect of document seizure, substantial financial penalties and the full weight of this agency’s investigatory apparatus?
Businesses have said that they want any action taken against them to be proportionate, and that the Fair Work Agency should function primarily as a compliance partner, not as a punitive instrument. The Minister has said that she shares that aspiration, and I invite her to say how that aspiration will be given legal and operational effect.
British Business Bank
Lord Hunt of Wirral Excerpts(3 months ago)
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Baroness Lloyd of Effra (Lab)
The Government’s statement of strategic priorities had as its first objective to support our most promising businesses in the industrial strategy priority sectors, and the digital and technologies sector is among the industrial sectors identified. When the next annual report comes out in a year, we will be able to tell exactly how successful that has been. However, we have seen, in the light of some of the direct investments made, that the British Business Bank has taken seriously the mandate to invest directly and is pursuing that pathway.
Lord Hunt of Wirral (Con)
My Lords, does the Minister agree with me how grateful we are to the noble Baroness, Lady Jones of Whitchurch, for introducing the subject of the British Business Bank, particularly at such a key time? Does she agree that, rather than setting demographic targets for investment, we and the British Business Bank should be focusing on backing the most investable opportunities in order to maximise productivity growth and returns for the taxpayer?
Baroness Lloyd of Effra (Lab)
I could not agree more with the noble Lord’s first point: my noble friend has given us a good opportunity to talk about this important institution. The new mission set by the British Business Bank is to drive economic growth by helping smaller businesses to get the finance they need to start, scale and stay in the UK. That is how we will grow a more productive economy here in the United Kingdom.