Ministerial Code
Lord True Excerpts(2 years, 11 months ago)
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Baroness Hayter of Kentish Town (Lab)
My Lords, there is a flaw in the Ministerial Code because, as the Statement says, the Prime Minister is the “ultimate judge” of the standards expected—but who judges the judges? Who will judge the Prime Minister as to whether he acts with the selflessness, integrity, honesty and openness demanded in the code? Only Parliament can judge. Will the Government provide all the information sought on lobbying and on the payments, including loans, for the No. 10 flat, so that we can end the innuendo and allow Parliament to judge on the basis of facts?
The Minister of State, Cabinet Office (Lord True) (Con)
My Lords, I assert again the importance of the Ministerial Code, which, as the noble Baroness said, is the responsibility of the Prime Minister of the day. The fact is that Ministers remain in office only for as long as they retain the confidence of the Prime Minister, whose constitutional role means that the management of ministerial appointments is his and is separate from the legislature. On the general running interest that there appears to be in the refurbishment of the Prime Minister’s flat, the costs of the wider refurbishment have been personally met by the Prime Minister. As has been said, the Government have been considering the merits of whether works on parts, or all, of the Downing Street estate could be funded by a trust, and this work is ongoing.
Lord Wallace of Saltaire (LD)
My Lords, the Statement refers to Britain as a “robust democracy”. We have done without a written constitution because we have rested on the honour and good conduct of our Ministers and, above all, our Prime Ministers. Can the Minister name any other constitutional democracy, or any other democracy in the world, in which the Prime Minister decides on the rules of ministerial conduct and appoints his own independent adviser without checks and balances from the justiciary or his legislature? Should we not now have to move towards an explicitly constitutional democracy, or risk drifting towards a people’s democracy?
Lord True (Con)
My Lords, I am rather old and to me “people’s democracy” conjures up the old eastern bloc. I am interested in high-quality, high-integrity government. The Ministerial Code is the foundation of that. But I must repeat to noble Lords, as I did to the noble Baroness opposite: the constitutional reality is that the appointment of Ministers is in the hands of the Prime Minister of the day. The Government are not considering a change to that position.
Baroness Browning (Con) [V]
Is my noble friend able to assure the House today that significant changes will be made to the Ministerial Code to ensure that there is independent enforcement and clear sanctions, unlike under the current arrangement?
Lord True (Con)
My Lords, as the noble Baroness opposite did, my noble friend raises an important point. The noble Lord, Lord Evans, the chair of the Committee on Standards in Public Life, has made a number of thoughtful recommendations about the role of the independent adviser. I know that the Prime Minister has asked the Cabinet Secretary, as part of the process of identifying a candidate, to look at how the remit might be amended. We will announce any changes alongside the appointment.
Baroness Deech (CB) [V]
Is the Minister as baffled as I am that the state does not pay more for the regular refurbishment of the residential parts of that most iconic building, 10 Downing Street? Vice-chancellors and trade union chiefs get far bigger sums spent on their official residences. The Guardian reported that £117,000 was spent on the house of the Speaker of the Commons within a few months of him taking up the post. Will the Minister press for the rules to be changed? Catering services ought to be offered, too.
Lord True (Con)
My Lords, many have expressed views similar to those of the noble Baroness. Other countries have slightly different practices on this, but, as I said in response to an earlier question, I am interested in practices in this country. Chequers and Dorneywood are operated in long-standing ways, reducing the need for subsidy from the public purse. These matters are complex, and policy development is ongoing. The Government did engage with the leader of the Opposition’s office on such proposals in July.
The Lord Bishop of Rochester
My Lords, I will not advise on internal decorations, but I observe that, by virtue of being here, we are all inhabitants of glass houses. We note the adage that being in a glass house makes us visible, so it is wise to behave in ways that do not disgrace this place or ourselves. We often hear words from or about Ministers and others in public office to the effect that he or she did not “break the rules”. Is that not to set the bar fairly low? Does the Minister agree that, while we are all fallible human beings, we, in public office, should aspire to the highest possible standards of probity and behaviour and not simply settle for keeping the rules? If we do not, public opinion will lead to ever tighter rules.
Lord True (Con)
I wholly agree with what the right reverend Prelate has said to the House.
Lord Foulkes of Cumnock (Lab Co-op)
My Lords, the noble Baroness, Lady Deech, has missed the point. Does the Minister not recall, as I do, that in the past Ministers, both Conservative and Labour, have resigned immediately when it has been clear that just one aspect of the Nolan principles, which include integrity, honesty—that is telling lies, by the way—and transparency, has been transgressed, particularly where Ministers have found advantage for themselves, their friends or their families? How many of these principles need to be transgressed these days before a Minister, and the Prime Minister in particular, will even consider resigning?
Lord True (Con)
My Lords, I believe the Prime Minister does and will conduct himself, as he has, in accordance with the principles of public life.
Baroness Noakes (Con)
My Lords, does my noble friend the Minister agree that while Westminster and the mainstream media are getting excited about things such as the decoration of the Prime Minister’s flat and who said what to whom in texts, away from the Westminster bubble, people are much more interested in getting their vaccinations, getting back together with their families and friends and getting the recovery of the economy under way?
Lord True (Con)
I do agree with my noble friend. The Prime Minister, in denying one of the more absurd allegations, made the same point. If I am allowed a personal comment: I have the privilege of having my second vaccination tomorrow thanks to a modern miracle of science. We should all be profoundly grateful for that and the way it has been carried through in this country.
Lord Tyler (LD) [V]
My Lords, Mr Johnson seems to suffer from severe memory loss when it comes to recalling what he has said or written, not least with regard to the commitments he gave in his introduction to the code, when he vowed Ministers would all avoid
“actual or perceived conflicts of interest.”
Given his cavalier approach, is it any wonder that Ministers appear to regard its obligations as entirely voluntary? Can the Minister assure us that he has never infringed the requirements of the code?
Lord True (Con)
I am not sure who the “he” is in that question. If the “he” is me: I have always sought to adhere to the Ministerial Code. If the “he” is the Prime Minister: I have said I believe the Prime Minister conducts himself in accordance with all the principles of public life.
Lord Herbert of South Downs (Con)
My Lords, we need proper rules, transparency and accountability, but does my noble friend agree that when the Civil Service faces such significant capability gaps—as we have seen, for instance, in the difficulties experienced by successive Governments in delivering major projects —we also need good people to be able to come into government and help? We must not make that excessively hard. After all, if that had not been the case for the vaccine rollout and delivery, we might not have procured those vaccines in the first place.
Lord True (Con)
My Lords, I certainly agree that we need a measure of objectivity on this, echoing the words of the right reverend Prelate. It is important that any malpractice should be dealt with. Transparency is important. As the noble Baroness asked, any reportable benefits will be recorded in the list of ministerial interests on the advice of the independent advisers. So far as broader Civil Service arrangements are concerned, my noble friend will know that Mr Boardman is looking into the matters in relation to Greensill. It is better to await the outcome of that inquiry. But, of course, I take note of what my noble friend said.
The Deputy Speaker (Baroness Henig) (Lab)
My Lords, the time allowed for this Question has elapsed.
Transparency of Lobbying, Non-Party Campaigning and Trade Union Administration Act 2014
Lord True Excerpts(2 years, 12 months ago)
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Lord Tyler
To ask Her Majesty’s Government what plans they have to review and update the Transparency of Lobbying, Non-Party Campaigning and Trade Union Administration Act 2014.
The Minister of State, Cabinet Office (Lord True) (Con)
My Lords, the Government are already conducting post-legislative scrutiny of Part 1 of the transparency of lobbying Act, which established the register. The post-legislative scrutiny was announced in 2020, and earlier this year Ministers met stakeholders to seek their views.
Lord Tyler (LD) [V]
My Lords, I recall that during the passage of the transparency Bill I quoted Mr Cameron as saying:
“Sunlight is the best disinfectant.”—[Official Report, 13/1/14; col. 29.]
Will the Government now implement the recommendations from the Public Relations and Communications Association to strengthen the Act? As the Minister will know, I and my colleagues secured a promise to include special advisers when the legislation had settled down and to examine the case for the inclusion of in-house lobbyists. Given the widespread public perception of Tory sleaze, will the Government now take action to ensure that the Act recognises the danger of privileged access for their prominent political supporters?
Lord True (Con)
My Lords, the noble Lord asks a wide range of questions there. In my contention, I believe that we have very high standards of integrity in public life in this country, and indeed in our Civil Service. But wherever there is the possibility of wrongdoing it should be investigated, and where it is uncovered it should be addressed. The Boardman review has been announced, and that work will be taken into account in any relevant post-legislative scrutiny work that is continuing.
Baroness Hayter of Kentish Town (Lab)
I am back. On 13 January 2014, an amendment from the noble and learned Lord, Lord Hardie, my noble friend Lady Royall and me would have extended the lobbying Bill to include in-house lobbyists and so cover, for example, David Cameron’s lobbying on behalf of Greensill. His then Government defeated that amendment by 185 to 218—two Not-Contents, of course, being from the noble Lords, Lord True and Lord Tyler. In the light of recent events, will the Minister now support a full register of all professional lobbyists? Will he take it from me that we will judge the forthcoming Queen’s Speech on whether it includes measures to outlaw the invidious, secret, back-channel lobbying that is so undermining of good governance?
Lord True (Con)
My Lords, I make a practice at this Dispatch Box of not throwing stones, and I think everyone in every party should be cautious about throwing stones. In response to what the noble Baroness said—I am sorry that she is in her place, but it is good to see her—on the question of in-house lobbyists, it is true that the Government did not pursue that in 2014. There are issues involved. It obviously will be considered currently. Such an approach would require thousands of businesses, charities, NGOs and trade bodies to pay a registration fee of £1,000 a year to write or speak to Ministers. That could be detrimental to the public interest, but I note what the noble Baroness says.
Lord Wallace of Saltaire (LD)
My Lords, I take my share of responsibility for the last Act. It is now clear that we have to extend further the coverage of lobbying activities. Will the Minister accept that these should include greater transparency for political think tanks, including full declaration of their sources of funding? As he will know, Conservative MPs are concerned about the Runnymede Trust. Others of us are concerned about the Institute of Economic Affairs and Policy Exchange, for example, which declare on their websites their access to Ministers and their influence over government policy.
Lord True (Con)
My Lords, the noble Lord makes a further suggestion. Since 2010, with the help of the party opposite, we have brought in a statutory registration of consultant lobbyists and a new routine of regular government transparency publications on spending, salaries, contracts and tenders. We are implementing the recommendations of the Boardman review on procurement. We have banned the practice under previous Governments of quangos hiring lobbyists to lobby the Government. We have made sure that taxpayer-funded government grants are not used for lobbying purposes and have provided for greater transparency on trade unions. We have done a number of things. That does not mean that more may not need to be done. I accept that work is ongoing to consider these matters.
Lord Grade of Yarmouth (Con) [V]
Does my noble friend the Minister agree that there is a much simpler solution to the lobbying problem than that being discussed? What is being discussed would require a written definition of what constitutes lobbying or who is or is not a lobbyist, which can lead only to endless arguments about interpretation. Is not the neatest and most effective solution to require all civil servants, serving Ministers and spads formally to log all and any lobbying approaches, however informal, and prescribe that they must respond by requiring the lobbyist to “put it in writing”? No one will ever stop people trying to lobby, so the onus should be on the recipient of any lobbying to respond in the correct manner.
Lord True (Con)
My Lords, I agree that transparency is important; that has been a standard across the House. Ministers’ and Permanent Secretaries’ appointments are published. Obviously, there is ongoing review of this work, not only by the Government but by a number of parliamentary committees. I am sure what my noble friend said will be noted.
Lord Sikka (Lab) [V]
My Lords, while it is right to constrain the power of lobbyists and former Ministers renting themselves out, the real cancer at the heart of our politics is corporate money and power, which fund political parties and legislators to gain unfair advantage in public policy-making. Is the Minister concerned? If so, what legislation will he propose?
Lord True (Con)
The noble Lord is the antithesis to capitalism. The remarkable success of private companies in procuring vaccines for the safety of our people is something for which I am profoundly grateful.
Baroness Barker (LD)
What changes will be made to the code about lobbying for government contracts directly via a Minister’s WhatsApp account and text?
Lord True (Con)
My Lords, all these matters are currently under review. I declare myself guilty occasionally of sending and receiving WhatsApp messages, in common with millions of other people in this country. I wonder which is the way to the guillotine.
Lord Norton of Louth (Con) [V]
My Lords, my question complements that of my noble friend Lord Grade. Given that the 2014 Act did not increase transparency and was focused not on lobbying but on lobbyists—the people, not the activity—will my noble friend commit to looking at ways to ensure that details of all representations made to government on Bills and ministerial policies are released at the same time that those Bills and policies are published?
Lord True (Con)
Again, my Lords, the noble Lord raises a specific point, as have a couple of other noble Lords who have spoken. I repeat that the Government have significantly increased transparency. There is post-legislative scrutiny of the Act and the Government will be going further to review and improve business appointment rules and increase transparency in procurement. We need to maintain high standards in public life—I agree with all noble Lords who have spoken.
Lord Dubs (Lab) [V]
My Lords, does the Minister agree that nobody should be a Member of either House of Parliament who is a paid advocate for a particular cause?
Lord True (Con)
My Lords, we have long had a paid-advocacy rule in your Lordships’ House, and it is a good rule.
Lord Lansley (Con)
My Lords, my noble friend will recall that I took charge in the Commons of the passage of the transparency of lobbying et cetera Act. In my view it was wrong then and is wrong now to include in-house lobbyists, because many thousands of people working in companies will have to register simply to speak on behalf of their own company.
My noble friends Lord Grade and Lord Norton of Louth have it right. There has never been a sufficient level of openness about who Ministers receive lobbying from, or indeed receive any communication from. That should be published. It was not sufficient then and it is not sufficient now.
Lord True (Con)
My noble friend puts his finger on a key issue that I alluded to in my reply to the noble Baroness opposite, in terms of the scale of the undertaking that would be required. I agree—government publishes data on meetings between Ministers, Permanent Secretaries and external interests. Regulation must balance the need for transparency on third-party lobbyists while not preventing engagement by the voluntary and private sector. These issues require and will receive very careful consideration. I can assure all noble Lords that the matter of integrity in public life is something that this Government take profoundly seriously.
The Lord Speaker (Lord Fowler)
My Lords, the time allowed for this Question has elapsed and it brings Question Time to an end.
Mobile Telephones: Public Emergency Alert System
Lord True Excerpts(3 years ago)
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Lord Harris of Haringey (Lab)
My Lords, I draw attention to my interests in the register and beg leave to ask the Question standing in my name on the Order Paper.
The Minister of State, Cabinet Office (Lord True) (Con)
My Lords, the Cabinet Office and the Department for Digital, Culture, Media and Sport are developing a cell broadcast alert system to enable people whose lives are at risk in an emergency to be rapidly contacted via their mobile phone. We are currently at the testing phase and, subject to successful progress, we hope to launch a service soon.
Lord Harris of Haringey (Lab)
My Lords, the Cabinet Office successfully tested the use of emergency text alerts in 2013. Last month, according to the Daily Telegraph, a cell broadcasting system was trialled in Reading, 12 years after the technology was adopted in Australia and subsequently by many other countries. Can the noble Lord tell us whether this long-awaited further trial, which surprisingly he did not mention, was regarded as a success? Progress in rolling out a cell broadcast system nationwide is welcome but is not flexible enough for every emergency. France is to have a hybrid system using locality-based SMS as well. This would, for example, have better protected residents of Grenfell Tower and told them that the evacuation advice had changed. The successful tenderer to roll out a nationwide service could provide a hybrid system. Is that under consideration?
Lord True (Con)
My Lords, I gave the noble Lord a brief response and will reiterate the point. The project is at the stage where plans for public trials are now being drawn up. We are ensuring that the timing is carefully aligned with the Covid-19 strategy, to avoid any confusion.
Lord Young of Cookham (Con)
My Lords, I commend the noble Lord, Lord Harris, for pursuing with such vigour the recommendations of his report published nearly five years ago. I recall some difficult times at the Dispatch Box trying to answer his questions. Since the report, we have had 4G, and now 5G, more people have mobile phones, the terrorist threat has not gone away, and the pandemic has identified new uses for this initiative. Can my noble friend give us a target date for when it will be rolled out in this country?
Lord True (Con)
My Lords, I cannot give a specific target date, for the reasons I have given. I said that we are ensuring the timing is carefully aligned with the Covid-19 strategy to avoid confusion. However, my noble friend is absolutely correct: technology advances. Our anticipation is that somewhere between 60% and 80% of phones may be contactable by this system when it comes in. As he and the noble Lord opposite said, we also have to be aware that anything which is broadcast is also able to be received by terrorists.
Lord Stevenson of Balmacara (Lab) [V]
My Lords, given the imminent obsolescence of the country’s analogue PSTN system, what assessment have the Government made of the impact their plans will have on the rollout of a voice over internet protocol technology and other communication systems, such as the red button alarm which is relied on by so many elderly people?
Lord True (Con)
My Lords, the system that is envisaged would be complementary to, and would not eliminate, other existing means of contacting people in danger and emergencies.
Lord Lancaster of Kimbolton (Con)
My Lords, of course a public emergency alert system is very important, but so too is a prompt response from the ground to any crisis. In the light of the pandemic, has the time come to update the national community resilience framework, which is, after all, just a framework, to a proper network, perhaps with the creation of a civilian reserve?
Lord True (Con)
My Lords, I again agree with those who have spoken that the ongoing response to Covid-19 demonstrates the value of a whole-community approach when responding to emergencies. As envisaged in the framework, to which my noble friend referred, we have seen how collaboration between local government and central government, statutory responders, businesses, volunteers and community networks have all been critical to the response. While there are no current plans to review the 2019 framework, we continue to learn lessons and evolve processes and guidance as appropriate.
Lord Foulkes of Cumnock (Lab Co-op)
But, my Lords, as we have heard, this has been going on for years. Meanwhile, the Government have been caught unaware by Russian poisoners, by floods and by the Grenfell disaster, not to mention the pandemic. What is causing the dithering and delay?
Lord True (Con)
My Lords, I do not acknowledge myself to be a ditherer or a delayer. So far as I am concerned, I am satisfied that progress is being made, since I am answering to your Lordships. I repeat what I have said: we hope to make an announcement on public trials very soon.
Lord Vaizey of Didcot (Con)
My Lords, I was the telecoms Minister when this issue was first raised, so I am delighted to see the Cabinet Office take all the blame for the dither and delay. I congratulate the noble Lord, Lord Harris, who has indeed campaigned on this issue for many years. I am delighted to hear that we are making progress. Does my noble friend agree that it is very important that we get the protocols right for when this system is used? It is a concern of the operators that it is not used with gay abandon, but assiduously and carefully.
Lord True (Con)
I agree with my noble friend and pay tribute to him, and all those who have spoken, for their interest in nudging—I guess that is the word—this forward. My noble friend is quite right to say that alerts must not scare or alarm people. The Government intend to launch a nationwide public information campaign to support the rollout of the service, to familiarise people with the look, sound and feel of the alert, and to inform them when it will be used and how it works.
Baroness Smith of Basildon (Lab)
It is great to have a public information system, but we do not know what it is for. This issue is so important because it is about managing risk. One of the problems at the moment is that it is not always clear where, in government, that responsibility lies. On 3 March, the Government said that they were actively
“reviewing where responsibility for biological security and the strategy sits within Government.”
The Minister said today that he understands the seriousness and urgency of these issues, and that he is satisfied with the progress, so can he update the House now, or write to me if he does not know, on whether a decision has been made and where that issue sits within the Government? If not, when can they tell us?
Lord True (Con)
I will have to write to the noble Baroness on biological security; I undertake to do so.
Lord Bhatia (Non-Afl) [V]
Will the Government provide free phones to those who cannot afford to buy them?
Lord True (Con)
The intention is for this to be a cell notice. There will be no charges for receipt of this service. The noble Lord makes a point about penetration and the capabilities of different telephones, and some people do not have or want a telephone at all. I assure him that the Government are taking all those matters into account.
Lord Flight (Con)
My Lords, in light of the recent record, can the Minister assure the House that the Government will now proceed with the implementation of a public alert system for mobile phones, which could have an important use in any pandemic and emergency, now that we have 4G and will soon have 5G technology?
Lord True (Con)
My Lords, I have given that assurance to the House. As I said in my Answer, the timing has to be carefully aligned with the Covid-19 strategy to avoid confusion. The proposition is for a cell message that drops down and does not collect any personal information from those who receive it. It is a specific approach.
Baroness McIntosh of Pickering (Con)
My Lords, it is extremely important, if we have a public emergency alert system, that it works in rural and upland areas, as well as elsewhere. I am excited that we can now piggyback mobile phones on to emergency services. Will my noble friend take this opportunity to ensure that mobile phone connectivity is improved by, for example, piggybacking on North Yorkshire Police and other emergency services, so that such a system of using emergency alerts works across the country, in rural as well as urban areas?
Lord True (Con)
My Lords, that is slightly wider than my responsibility, but the Government are committed to extending coverage as far and as fast as they possibly can. On the specific question, emergency alerts will be available for the whole United Kingdom. Telecoms is a reserved matter, but the Government intend to work with the DAs to enable them to use this new capability within their own jurisdictions to save lives in an emergency.
The Lord Speaker (Lord Fowler)
My Lords, all supplementary questions have been asked, so we now move to the second Oral Question.
Gender-balanced Parliament and Male Primogeniture
Lord True Excerpts(3 years ago)
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The Minister of State, Cabinet Office (Lord True) (Con)
My Lords, as the Prime Minister has made clear, we want to see more women in Parliament. That is a much wider issue than male primogeniture, but reform of the succession to hereditary peerages and baronetcies raises a variety of complex issues, and therefore any changes need careful consideration and wider engagement.
Lord Lucas (Con) [V]
My Lords, I am very grateful for my noble friend’s reply. Does he agree that small, symbolic issues matter in our gradual progress towards female equality? The monarchy having shown the way in the matter of the inheritance of titles, will Her Majesty’s Government take whatever opportunity next presents itself to engage in the detailed consideration to which my noble friend refers?
Lord True (Con)
My Lords, many proposals have been put forward, and many have failed to find support. I know that my noble friend put forward a Private Member’s Bill in 2013 for a voluntary approach, but the issues are, as I say, complex.
Baroness Gale (Lab) [V]
Is the Minister aware that, since 1958, only 326 life Peers created have been women, representing 21% of the total? Not one woman hereditary Peer sits in this House today, and that is why I fully agree with the views of the noble Lord, Lord Lucas. Does the Minister agree that in any other place this would be regarded as totally unacceptable and could be reported to the Equality and Human Rights Commission as blatant discrimination?
Lord True (Con)
My Lords, hereditary peerages are not currently created. There are life Peers in your Lordships’ House and the life peerage is gender-blind. There are 223 female Peers currently, 28% of the Members of the House of Lords. The Government’s aspiration is, of course, to see more.
Lord Tyler (LD) [V]
My Lords, do the Government accept that the simplest and quickest way to make progress in this direction, so far as this House is concerned, without complex legislation, would be to abolish the by-elections for hereditary Peers, since all the candidates are male? This temporary political fix of more than 20 years is well past its sell-by date. Will the Minister undertake to communicate to his colleagues the overwhelming view of this House that this should be included in the Government’s legislation for the coming Session?
Lord True (Con)
My Lords, it is not for me to comment on legislation in the forthcoming Session, but I would advise the noble Lord not to be a betting man.
The Earl of Shrewsbury (Con)
My Lords, my noble friend will be totally aware that I am a product of male primogeniture, and he will realise, no doubt, that I have an interest in the whole subject. What plans, if any, do Her Majesty’s Government have to amend male primogeniture in the hereditary peerage and baronetage?
Lord True (Con)
My Lords, a review is not currently under way. As I have explained, this is a complex issue and careful consideration will be needed.
Baroness Prashar (CB) [V]
While it is encouraging that the Prime Minister supports a 50:50 gender-balanced Parliament, it is very disappointing that progress has been so slow, and we still have a law that discriminates against women. What steps will be taken to ensure that women from minority communities are not left behind in whatever initiative is taken in this direction?
Lord True (Con)
The noble Baroness makes a very important point. Improving the diversity of Parliament is something to which I believe all political parties assent, and this Government no less than any other. Beyond your Lordships’ House, where we must sometimes look, there are now 220 female Members of Parliament; that is more women in the House of Commons than ever before. That is surely progress.
Baroness Smith of Basildon (Lab)
My Lords, the noble Lord, Lord Lucas, raises the issue of male primogeniture, which is clearly unfair, but I have to say that, of all the issues of gender equality where I would seek to make a difference, it is probably not top of my list. I bring the Minister back to the point made by the noble Lord, Lord Tyler. Hereditary by-elections have had their day; the legislation is outdated. If we want to address what is clearly an inequality, in that there are no female hereditary Peers in this House—the issue of peerages outside the House is a completely different one—surely the Government should support the Grocott Bill when it will undoubtedly come before your Lordships’ House again, and not let it be wrecked by a few. It is time for the Government to show some courage on this issue.
Lord True (Con)
My Lords, the Government assent to the rule of law, and I believe that the law as is should be applied in this respect.
Lord Addington (LD)
My Lords, I have to declare an interest as a hereditary Peer but one who has only a daughter. I suggest that the Government will lose nothing by bringing forward something that allows this to happen. As for hereditary by-elections, given that people who were conceived after the system was instituted are now voting adults, surely it has had its day and has not worked as a stimulus to further reform.
Lord True (Con)
My Lords, I think we have discussed the issue of hereditary by-elections. On the matter of succession to titles, any change would affect many families, many of whom have no claim to be Members of your Lordships’ House, and all those issues and interests would have to be considered.
Baroness Uddin (Non-Afl) [V]
My Lords, male primogeniture is indefensible and damages our striving for equality and justice. Ever-increasing numbers of Members are being appointed to this House and, continuing in the time-honoured tradition, men are favoured, leaving just 223 female Members in this Chamber, as the Minister indicated. I welcome the Minister’s assurance and the Prime Minister’s promise, but, given the perceptible resistance to recognising institutional gender and race discrimination, what plans are in place to remedy this?
Lord True (Con)
My Lords, until we have full reform of your Lordships’ House, if Parliament decides on that, recommendations for life peerages are in the hands of leaders of political parties. Of Peers appointed by the current Prime Minister, 32% have been women, as against 29% under Gordon Brown and 23% under Mr Blair. Again, I suggest that that represents progress.
The Earl of Caithness (Con) [V]
My Lords, I declare my interest as a hereditary Peer. My noble friend the Minister said that this requires careful consideration and is a complex matter: that is everyday meat for any Government. Will my noble friend encourage his right honourable friend the Secretary of State to undertake a review of this matter once and for all, so that the eldest child can inherit a title where that is applicable?
Lord True (Con)
My Lords, I am sure my friends and I will read the views of my noble friend, and indeed all others who have spoken, with due respect. However, I believe that, at the height of this pandemic, and given the need we have to recover, it may well be that some people in the country have other priorities.
Baroness Deech (CB) [V]
Whether or not hereditary peerages remain, it is time to get some sex equality into this House. The husbands of noble Baronesses get second-class treatment, and this is highly symbolic. Only a few days ago, the entire nation noted the essential support given by Prince Philip to his wife, but the support given by the husbands of noble Baronesses is ignored compared with the recognition, by the title “Lady”, of the wives of noble Lords. Does the Minister agree that our husbands should be given a title equivalent to that granted to the wives, or that the latter should lose theirs?
Lord True (Con)
My Lords, the noble Baroness touches on another issue which has its own sensitivities. Reform of courtesy titles in the honours system as well as the peerage system—this is not a matter of heredity—may not be straightforward, but there is a need to consider how to deal with existing entitlements.
Lord Foulkes of Cumnock (Lab Co-op)
My Lords, is the Minister aware that I was deputy to two women Secretaries of State—Clare Short and Helen Liddell, now my noble friend Lady Liddell of Coatdyke—who were both excellent Cabinet Ministers? Since Boris Johnson has only five women in his Cabinet, could the Minister use his undoubted influence and have a word with him to appoint more women instead of old Etonians and male clones?
Lord True (Con)
My Lords, I hope the noble Lord does not see in me a clone of the Prime Minister—my hair is a different colour, for a start. I would love to have the noble Lord as my deputy. I repeat that the aspiration of the Prime Minister, reflected in peerage creations and the number of MPs in the House of Commons, is to see more women in Parliament.
The Deputy Speaker (Baroness Henig) (Lab)
My Lords, all supplementary questions have been asked.
Financial Services Bill
Lord True ExcerptsWednesday 14th April 2021
(3 years ago)
Lords ChamberRead Full debate Financial Services Bill 2019-21 View all Financial Services Bill 2019-21 Debates Read Hansard Text Read Debate Ministerial Extracts Amendment Paper: HL Bill 162-R-III Third marshalled list for Report - (14 Apr 2021)
“Regulated activities and application of Consumer Credit Act 1974
(1) This section applies on or at any time after the making of an order under section 22 of the Financial Services and Markets Act 2000, after this section comes into force, which has the effect that a relevant credit activity becomes a regulated activity for the purposes of that Act.(2) Section 107(6) of the Financial Services Act 2012 (power to make provision about the application of the Consumer Credit Act 1974) has effect as if—(a) the reference to an order of the kind mentioned in subsection (1) of that section included an order of the kind mentioned in subsection (1) of this section, and(b) the references to a transferred activity included a relevant credit activity which is the subject of an order of the kind mentioned in subsection (1) of this section.(3) “Relevant credit activity” means the activity of—(a) entering into an agreement described in article 60F(2) or (3) of the Regulated Activities Order (certain borrower-lender-supplier agreements for fixed-sum credit or running-account credit) as lender, or(b) exercising, or having the right to exercise, the lender’s rights and duties under such an agreement,so far as the activity is not a transferred activity (as defined in section 107(1) of the Financial Services Act 2012).(4) “The Regulated Activities Order” means the Financial Services and Markets Act 2000 (Regulated Activities) Order 2001 (S.I. 2001/544) as it has effect on the passing of this Act.”Member’s explanatory statement
Section 107(6) of the Financial Services Act 2012 provides that the Treasury may disapply provisions of the Consumer Credit Act 1974 in relation to an activity previously licensed under the 1974 Act, or exempted under specified provisions of that Act, where the activity has become a regulated activity for the purposes of the Financial Services and Markets Act 2000. This amendment extends that power to certain other activities of lenders.
The Minister of State, Cabinet Office (Lord True) (Con)
My Lords, the Government have brought forward Amendment 14 to ensure that buy now, pay later products can be brought into scope of regulation in a way that is proportionate to the risks that they pose to consumers. As noble Lords will recall from previous debates, to which the Government listened carefully, on 2 February following the publication of the Woolard Review into the unsecured credit market, the Government announced their intention to regulate interest-free buy now, pay later products. Following that announcement, the Government have been working at pace to ensure that this can be done in a proportionate and timely manner. Amendment 14 is the next step in this process. Many noble Lords were keen to see progress on the issue, so I hope that they will welcome the amendment today.
The Government recognise the concerns that exist with these products as the market continues to grow in the United Kingdom. We are therefore acting decisively to address the risk of detriment to consumers. The Government intend to bring buy now, pay later products within the scope of the regulatory framework, which includes the application of the Consumer Credit Act 1974. However, as noble Lords have previously heard, it is important to note that those products are interest-free, and thus are inherently lower-risk than most other forms of borrowing. Used properly, they can provide a lower-cost alternative to mainstream or high-cost credit. The Government’s view is that they can therefore be a useful part of the toolkit for managing personal finances and tackling financial exclusion, a topic that I will return to later in the debate. It is therefore essential that when buy now, pay later products are brought into regulation, it is done in a way that provides robust consumer protection, while ensuring that it is viable for firms to continue to offer these products. Amendment 14 will ensure that that can be done.
Some of the provisions of the Consumer Credit Act could be disproportionate, given the short term, interest-free nature of buy now, pay later products. They could also materially impact the way in which consumers are able to access these products. As a result, this amendment seeks to provide the Government with the power to ensure that the provisions of the Consumer Credit Act 1974 that will apply to buy now, pay later products are proportionate to the risks that the products present. This will allow the Government to apply only the provisions of the Act that have been determined to be proportionate to the risks posed by buy now, pay later products.
The Government intend to publish a consultation later this spring where the views of consumers, buy now, pay later providers and the retailers that offer these products will be sought on this matter. We will carefully consider these views to inform our approach to creating a proportionate regime, including decisions on which provisions in the Consumer Credit Act should apply to buy now, pay later agreements. Following this, we will take forward the necessary secondary legislation to bring buy now, pay later agreements into regulation. That secondary legislation will be subject to the affirmative resolution procedure, meaning that noble Lords will have the opportunity to further scrutinise and comment on the Government’s proposals. I therefore ask that your Lordships support this amendment to ensure that the regulation of buy now, pay later can proceed both at pace and in a proportionate manner. I beg to move.
Lord Holmes of Richmond (Con)
My Lords, it is a pleasure to follow the Minister. In doing so, I declare my financial services interests as set out in the register. I would like to be the first to offer my support for Amendment 14 and what it seeks to achieve. I congratulate my noble friend on the decision to use the affirmative procedure to bring these powers into force.
I will now speak to Amendment 35 in my name. The thinking behind it is quite straightforward: financial exclusion has dogged our nation for decades, ruining individual lives and putting down potential. Solutions exist and thousands of people are working so hard in this area, but we need to do more and we need more innovation: hence the two elements in Amendment 35. It seeks to give the Bank of England—our central bank—a more significant role when it comes to financial exclusion. The Bank has an enviable brand, respected right across the UK and revered around the world. This brand could be well put towards solving the problem of financial exclusion.
The first part of Amendment 35 seeks to give the Financial Policy Committee of the Bank of England an objective to monitor financial exclusion. As noble Lords know, the FPC is responsible for financial stability in the UK. I believe there are 407 billion new reasons to take this opportunity to reconsider financial stability and include financial exclusion within the remit of the FPC.
The second limb of the amendment seeks to suggest the opportunity for the Bank to offer basic bank accounts to those who find themselves financially excluded. The take-up of bank accounts for those financially excluded is not just a measure of what is currently available from retail providers. The history of those individuals also plays a key part, so, again, the brand and the central place of the Bank could play a critical role here. If we considered some of those accounts potentially being digital accounts—perhaps central bank digital currency accounts or digital pound accounts—the Bank might play a critical role in addressing digital as well as financial exclusion.
The Old Lady of Threadneedle Street could be not just lender of last resort but potentially, through Amendment 35, provider of first support for those individuals en route to financial inclusion. Provider of first support is certainly worth a thought. Does the Minister agree?
Lord True (Con)
My Lords, nearly 190 years ago, the great Duke of Wellington came into a new House and famously commented, “I never saw so many shocking bad hats in my life.” Looking round today, I have to say that I never saw so many magnificent new haircuts in my life—and I look forward to seeing many more in the next days and weeks.
I thank all those who have contributed to the debate, on a subject that I assure noble Lords we shall continue to consider very carefully, as the noble Lord, Lord Tunnicliffe, asked. I am grateful for the general support that has been given, and the generous remarks made by the noble Lord. I am sure I speak for my noble friends the noble Earl and Lady Penn when I say how much we have appreciated the constructive engagement of Peers on all sides with this legislation. I assure the noble Lord that, through the consultation and leading forward to the affirmative instrument we have promised, we will continue to give the most careful consideration to all ideas.
For my noble friend Lord Naseby, I can again confirm that there will be a full public consultation as soon as possible after Royal Assent. That will allow input from all interested parties, as my noble friend asked.
I thank the noble Baroness, Lady Kramer, for her broad support. She criticised the product, albeit that it is a lower risk than some other types of credit. We certainly agree that a proportionate approach to regulation is the right goal, and that is what I set out. The Government are engaging with stakeholders and will, as I say, consult in the spring to ensure that regulation provides the appropriate degree of consumer protection. I assure the noble Baroness that the Government are not complacent. Indeed, that is why we are taking action and are open to continuing consideration and discussion on this matter. All in all, I am very grateful for the response from your Lordships to government Amendment 14.
I will now address the second amendment in the group, Amendment 35, from my noble friend Lord Holmes of Richmond. I join others in paying tribute to his indefatigable work in this regard, which we all so much admire. His amendment similarly deals with products that aim at increasing financial inclusion.
Amendment 35 would make the Financial Policy Committee of the Bank of England responsible for monitoring financial exclusion and reporting on progress on offering basic bank accounts to financially excluded individuals. The Financial Policy Committee has responsibility for addressing systemic risks and protecting and enhancing the resilience of the UK financial system. As my noble friend Lady Noakes has argued, I am afraid the Government do not believe it is an appropriate body for this task. By the way, I hope no one listening to our debates will draw from the fact that the Bank took away my noble friend’s cheque book any conclusion about her creditworthiness, nor indeed start a run on the Bank of England. It is a question of principle, and we do not believe the body is appropriate.
However, I reiterate that reducing financial exclusion remains a key priority for the Government and one we continue to drive forward. I think we in this debate are all agreed on that, albeit with due caution, as expressed by my noble friend Lady Neville-Rolfe and others. We are committed to ensuring that everyone can have access to useful and affordable financial products and services. This has also been a particularly important part of our work during the pandemic.
Noble Lords asked for examples. One way we are doing this is through the biannual Financial Inclusion Policy Forum, of which the Economic Secretary is co-chair. Just a few months ago, in November, the Treasury published its latest annual Financial Inclusion Report for 2019-20. It sets out all the recent work on financial inclusion. Not only this, but the Treasury’s Basic Bank Accounts report came out in January this year.
Access to a bank account is the first step on the path to financial inclusion and capability. Basic bank accounts are an important product and allow those who are financially excluded in the United Kingdom to access mainstream banking services, providing people with a way to receive their income and manage their money securely and confidently. To my noble friend Lady McIntosh, I can say that this includes those with low credit scores.
In 2014 the Government negotiated a voluntary agreement with the banking industry on the establishment of basic bank accounts, in which industry agreed to the publication of basic bank account data. Indeed, since 2016 the Treasury has published data on basic bank accounts annually, including data on firms’ basic bank account market shares. We have made progress on this issue. The most recent report shows that, as of June 2020, there were 7.2 million basic bank accounts open in the United Kingdom.
I do not in any way underestimate the importance of the points put forward by my noble friend Lord Holmes of Richmond, but the Government are confident that Amendment 35 as drafted would not do more than what the Government are already doing to tackle financial exclusion or to monitor financial inclusion and report progress on basic bank accounts. Though we admire its intent, it bears a significant risk of duplication of effort, and the Government therefore cannot accept it. Having listened carefully and undertaken to continue to listen carefully to my noble friend, I ask him not to press his amendment.
Lord True (Con)
My Lords, I am grateful to all those who have spoken in this short debate. As has been said, Amendment 15 seeks to require the Government to make regulations to facilitate the availability of sharia-compliant financial services in the UK, including a sharia-compliant student finance product, within six months of the passing of the Bill.
Institutions across the United Kingdom have been providing sharia-compliant financial services for nearly 40 years, and the United Kingdom is the leading western centre for Islamic finance. I do not believe that anyone would dispute that the United Kingdom is a world leader in this area. This Government continue to promote the growth of this sector, supporting domestic financial inclusion and our connections with key markets abroad. With respect, I think that, in this context, the charges from the noble Lord, Lord Sharkey, of “casual contempt” for the Muslim community and of discrimination were a little misplaced.
Student finance is not regulated by the FCA. I did, however, listen very carefully and respectfully to the noble Baroness, Lady Sheehan, who spoke from a position of personal commitment. I can assure the noble Baroness and the noble Lords that the Government wish to extend the reach of the student finance system so that everyone with the ability to benefit from higher education can do so. That is why we have legislated to make a system of alternative payments that is compatible with Islamic finance principles possible.
As I said in my remarks in Committee, a range of complex policy, legal and systemic issues need to be resolved before a Sharia-compatible product can be launched. Despite these challenges, the Department for Education has been working with specialist advisers to establish an appropriate product specification that meets the requirements of Islamic finance.
I also heard the concerns raised in Committee, and by the noble Lord, Lord Sharkey, again today, that it is not clear enough when the Government will take the next step. Since Committee, when I was concerned to hear those criticisms, I have discussed the matter with the relevant Minister in the Department for Education. Based on this, I can report that this matter is being considered as part of the wider review of post-18 education and funding.
I hope, therefore, that noble Lords will appreciate that it is not the right time to act until the wider strategy on post-18 education has been settled. I appreciate that some noble Lords, including those who have spoken, would like to see faster progress here—the question of when was put. I am able to reassure the House that there will be an update on this work as part of the review of post-18 education and funding when it is published, which will be at the next multi-year spending review. The Government will conduct the next spending review later this year. Further details on the nature of that spending review will be set out in due course.
On that basis, and with the commitment to progress as part of the review, I hope that the noble Lord will accept the assurance that the Government are committed to making progress on this very important issue and feel able to withdraw his amendment.
Lord Sharkey (LD) [V]
I thank all noble Lords who have spoken in this brief debate and I thank the Minister for his response. I point out, however, that we legislated to take powers to do this four years ago. Nothing has happened since. I remind the Minister, too, that the Help to Buy system was up and running within five or six months—and that was Islamic finance.
I also note that references to the post-18 education review seem to me—and have always seemed to me, as I said in my letter to the Minister, to which I did not get a response—completely irrelevant. We want students, Muslim or not, to be treated equally. If there is a change, after the post-18 Augar review, to the way that student finance happens, it should apply to Muslim and non-Muslim students equally: there should be no need to wait to establish the principle that Muslim and non-Muslim students should have equal access to finance. There is no need to wait.
I note, finally, that the promise of an update is not a promise to do anything at all, and does not even come close to setting a date by which these cohorts of Muslim students can gain access to finance and go on to university. In the Minister’s response there was no promise and no clarity, just talk of commitment. But after 13 years of this promise, talk of commitment is not enough, and I wish to test the opinion of the House.
Lord Tunnicliffe (Lab) [V]
My Lords, the issues covered by this group are wide-ranging in nature but all important. Amendments 16 and 25 return to issues that we explored in Grand Committee, while the right reverend Prelate the Bishop of St Albans and the noble Lord, Lord Young of Cookham, have found interesting ways to bring important issues to our attention.
The noble Baroness, Lady Meacher, made a convincing case for the need to reform how bailiff activity is regulated. One interesting thing about the Covid-19 pandemic has been its ability to make us look at long-standing issues in a new light, and issues of personal debt are no exception to that. It is promising that both sides of the argument—bailiffs themselves and charities providing advice to those with problem debt—seem to agree on the need for change. This is not a common occurrence, and it provides an opportunity that I hope the Government will seize in the weeks and months ahead.
I know that my noble friend Lord Stevenson, working alongside the noble Baroness, Lady Meacher, has been pushing on this in the background in the hope that the Ministry of Justice can provide a more meaningful response than we had in Grand Committee. What we really need is for the department to identify an appropriate legislative vehicle for this matter. We very much hope that this will be signposted in the document promised for later this year.
Amendment 26 seeks to broaden the scope of the Financial Ombudsman Service to allow potential customers to submit complaints against financial services firms. This is a fair question to ask: clearly the noble Lord, Lord Leigh, is not satisfied with the previous answer to it. On day 1 of Report, we passed an amendment that would enable the FCA to impose on regulated financial services entities a statutory duty of care towards customers. We hope that, despite their misgivings, the Government take this forward, as we believe that new consumer-centric working practices could negate the need for a proportion of complaints to the ombudsman.
Amendment 27, tabled by the right reverend Prelate the Bishop of St Albans, is not only an impressive interpretation of scope, but raises important questions in relation to the tools available to those experiencing issues with problem gambling. Labour has previously been critical of the Government’s lack of urgency in launching reviews and introducing legislation and regulation. That process is now under way—indeed, I believe that the initial call for evidence has now closed. It is clear to all colleagues that the current regulatory regime has serious shortcomings. Without seeking to pre-empt the outcomes of the DCMS-led review, I hope that the Minister can demonstrate that the Government will take the right reverend Prelate’s suggestions on board.
Finally, Amendment 37C raises what looks to be an important issue in relation to certain payments made from child trust funds or junior ISAs on behalf of children with learning difficulties. I do not believe that we have touched on this issue previously, so I hope that the Minister will commit to a future discussion with the noble Lord, Lord Young of Cookham, and my noble friend Lord Blunkett.
Lord True (Con)
My Lords, this has been a long and important debate, which I found to be of great interest. As many will know, I am not responsible for the grouping of amendments. That is not a matter for the Executive; it is a matter for the House. However, following on from the noble Lord, Lord Addington, I feel a little like the “MasterChef” hopeful who presents his dish to the judges and is told that there are too many things on the plate. There are different issues conjoined here: the important issue of the behaviour of bailiffs—as, being an old boy, I still call them—credit card applications, gambling protection and child trust funds in the case of incapacity. It is a diverse group of amendments, but they all relate to the protection and fair treatment of consumers and, as we have heard today, of the most vulnerable people in society. I will try to respond to each of them, but I am not certain that I will be able to satisfy every hope of everyone who has spoken. I hope, however, because I am confident from the discussions that I have had with colleagues in different departments—I come as an outsider to this—that I can assure your Lordships that my perception is that the Government are positively engaged on all these fronts and are listening, have listened and will listen.
Amendment 16, from the noble Baroness, Lady Meacher, and others, would commit the Government to making the activities of enforcement agents—also known as bailiffs—in relation to taking control of goods a regulated activity under the Financial Services and Markets Act 2000. The Government understand the importance of debts being enforced in a fair and proportionate manner. Since Committee, I have had the great advantage of speaking directly to the noble Baroness and others, including the noble Baroness, Lady Morgan, and the noble Lord, Lord Stevenson of Balmacara, along with my colleague, my noble friend Lord Wolfson from the Ministry of Justice, which is the department with responsibility for the regulation of enforcement agents. I know that my noble friend Lord Wolfson and the Minister of Justice have heard the arguments of noble Lords. I can reassure the House that the Ministry of Justice is currently reviewing the case for strengthening the regulation of the enforcement sector. As we have heard, that would be widely welcomed, as representatives from the enforcement and debt advice sectors have united to form a working group, led by the Centre for Social Justice, to consider how an independent oversight body could raise standards in the sector. The Government welcome this.
The Ministry of Justice recognises the important momentum of this development and looks forward to continuing to engage with the working group on its proposals for an enforcement conduct authority. The Ministry of Justice has also assured me that it would want to work closely with the working group to monitor the operation of the enforcement conduct authority and will review its operation within two years. At that point, it will consider whether there is a case for legislation to provide statutory underpinning to the body if necessary, as some noble Lords have argued. I stress that the Ministry of Justice will look to work with the enforcement authority as soon as it is established to assess what can be done to improve standards on the ground. It does not see the two years as a target: it would be willing to review the authority operation and consider legislation before the two years if necessary. I hope that that has reassured noble Lords that the Government take this offer from industry very seriously.
On the amendment itself, it would by default require the FCA to act as the regulator of enforcement agents unless its functions were delegated to another body within two years following the passage of this Bill. As I set out in Committee and in the valued exchanges that I have had with noble Lords involved, I think that there is now agreement—indeed, that has been expressed by the noble Baroness, Lady Meacher, and others—that the FCA would not be the right body for such a function. I must underline that the Government’s view on this will not change between now and Third Reading. We do not believe this Bill to be the right legislative vehicle for any changes to the regulation of enforcement agents. I hope that, having heard the assurances that I and my noble friend Lord Wolfson have given, noble Lords will withdraw the amendment and continue to engage with the Government as we go forward.
My noble friend Lord Trenchard asked about the use of the Corporate Insolvency and Governance Act moratorium to give UK companies a formal breathing place in which to pursue a restructuring plan in case of indebtedness. The power is working as intended. A handful of firms have already successfully applied to use the moratorium under the Act. As government support and regulatory easements come to an end, we expect the number of firms using the moratorium to increase. The new restructuring plan is also being used to good effect with Virgin Atlantic and other large firms using the new tool to recapitalise balance sheets.
Amendment 26 from my noble friend Lord Leigh of Hurley seeks to expand the jurisdiction of the Financial Ombudsman Service to include potential customers. I am grateful to my noble friend for his characteristic persistence on this important issue and I know that he is keen to make sure that the regulatory system ensures that others are not faced with the same potential risk of fraud that he experienced. As I sought to reassure noble Lords in Committee, it is already the case that both customers and potential customers of a firm can seek redress through the FOS scheme under the FCA’s existing rules, notably rules in the FCA dispute resolution handbook.
If we have understood the specific case correctly, my noble friend was the unfortunate victim of attempted fraud and did not intend to be a customer of the firm. He was therefore not a potential customer as defined by the relevant rules that cover people seeking to be a customer. As I said in Committee, I assure the House that had this incident led to financial loss or to my noble friend being pursued for a debt that was not his, he would have had recourse to the FOS and been supported by the current regulatory framework.
Lord Young of Cookham (Con)
My Lords, I thank my noble friend for stretching the constraints that we understand are forced on him as far as we could reasonably expect. I ask him, without trampling on the independence of the judiciary, to convey to the Court of Protection before the next meeting the strength of feeling on all sides of the House about the need to streamline, accelerate and simplify the process.
In not ruling out legislation, does he understand that, in the next Session, if I, and others who have been good enough to speak, believe that progress has not been sufficiently speedy, we will be back with the first possible legislative vehicle to press the issue again, having taken on board some of the reservations expressed during the course of this debate?
Lord True (Con)
My Lords, I am confident that your Lordships’ Official Report is breakfast-time reading for every member of the Court of Protection, as indeed for every other citizen in this kingdom. I assure my noble friend that we will make sure that all those interested are made aware of the arguments that he and others have put before the upcoming meetings that have been referred to.
On going forward, I assure my noble friend that the Government will be happy to provide updates on progress on this matter to Parliament. We are very happy to continue the conversation with him, particularly on the issues that he has just raised.
Baroness Meacher (CB)
My Lords, I thank the many noble Lords who spoke so powerfully in support of Amendment 16. I also note the powerful speeches in support of the other significant amendments in this group, as has been pointed out. I reassure the noble Viscount, Lord Trenchard, that, in fact, we are very clear that the Financial Services Authority is not the right vehicle to become the regulator for the enforcement industry—we made that very clear to Ministers in our meeting, as the Minister knows, and I tried to make that clear in my speech. I am also very grateful for his response to Amendment 16 and the other amendments in the group.
Of course, the Minister will not be surprised that the many people involved in Amendment 16 will continue to work with the noble Lord, Lord Wolfson, and others to try to achieve statutory underpinning for the enforcement regulator from the start because the industry regards this as absolutely essential. We will look to the PCSC Bill as a possible vehicle for that. On that basis, I beg leave to withdraw my amendment.
Lord Tunnicliffe (Lab) [V]
My Lords, I shall be brief in responding to the amendment, which was ably introduced by my noble friend Lord Stevenson of Balmacara. We are grateful to the Minister and officials for their time discussing this and other consumer issues during the passage of the Bill. Those meetings have been useful, particularly for better understanding the numbers of people affected by financial agreements enabled by the antiquated bills of sale Acts referenced in the amendment. We understand that the Government cannot simply accept the amendment, because of the complexity of the issue and the scope for unintended consequences. Normally we would roll our eyes on hearing that phrase, but, as my noble friend noted, this amendment was tabled as a means of starting a conversation. We hope the Minister can give a strong commitment from the Dispatch Box that the Treasury will undertake a proper review of this part of the credit market, and will have regard to the earlier Law Commission recommendations when deciding on a policy response.
Lord True (Con)
My Lords, again I thank all those who have spoken in this slightly shorter debate. I thank the noble Lord, Lord Stevenson of Balmacara, very much for his continued engagement with all aspects of the Bill and with the underlying issues of credit—on which he has long been such a distinguished advocate—and for his interest in this issue. I hope I will be able to give him an assurance that he will find satisfactory.
First, however, I must respond to my noble friends Lady McIntosh of Pickering and Lord Holmes, who asked about the Law Commission report. The noble Baroness, Lady Kramer, also alluded to it. I set out in Committee the reasoning behind the Government’s decision not to take forward their proposed goods mortgages Bill, which had followed from the Law Commission report, in 2018. That Bill would have repealed the bills of sale Acts and replaced them with a new goods mortgages Act, and it was the result of the Law Commission’s report on bills of sale, to which my noble friends referred.
However, when the Government consulted on the proposed goods mortgages Bill, the consultation responses—not all of them, I confess, but the serious responses—showed that while there was broad support for the proposed approach set out in the Bill, some stakeholders raised significant concerns about the degree of consumer protection afforded by the proposed regime. Furthermore, there was a risk that a more modernised, streamlined regime for consumers could lead to more consumers using goods that they already owned as security for a loan, which is inherently a higher-risk form of borrowing. Given the concerns raised in the consultation and the shrinking size of the market, the Government decided not to take forward the goods mortgages Bill. Still, I highlight again that the use of logbook loans has fallen substantially and continues to decline: the number of bills of sale registered at the High Court has fallen from 52,000 in 2014 to just 3,758 in 2020—and a little higher the previous year. Obviously, we will watch this figure.
A number of other points were also raised in Committee. The noble Lord, Lord Stevenson, raised the cost of logbook loans. It has been suggested that some of these loans have very high interest rates. There is already a power for the FCA to cap the cost of all forms of credit, including logbook loans. It will use that power where it thinks it is necessary to protect consumers. Most recently, it capped the cost of rent-to-own products in March 2019.
My noble friend Lady McIntosh questioned in Committee why a model that used hire purchase could not be used for logbook loans. Hire purchase is a financing option that allows borrowers to hire a car and then gives them the option to buy it by the end of the contract. This model would be inappropriate for borrowers who already own their vehicle, as ownership of a vehicle should automatically revert to the borrower when they have repaid their loan.
I turn to the amendment itself. As I explained in Committee, it is likely to have unintended consequences that could lead to a greater risk of detriment, particularly to borrowers. The repeal of the bills of sale Acts would not necessarily prevent this type of credit being offered. Rather, it would remove the statutory framework that governs this type of credit, which could inadvertently lead to a greater use of such lending through the removal of some of the frictions to which some who have spoken have alluded—“frictions” is a polite Treasury word—that the bills of sale Acts impose. Given that, the Government do not believe that repealing the bills of sale Acts would be an effective way of increasing protection for borrowers. Furthermore, the Government do not believe that it would be proportionate to introduce new legislation to specifically implement a replacement for the bills of sale Acts, given the continued decline in their use.
However, I recognise the strength of the feelings of the noble Lord, Lord Stevenson, on the subject of logbook loans, and I have heard the echoes that his resounding voice has provoked. I understand that he wants to know what plans the Government have to review the regulatory treatment of logbook loans. I have had the opportunity to discuss this issue with the noble Lord. As we look beyond the Covid-19 crisis, the Government are keen that work should progress to consider reform of the broader consumer credit regulatory framework to ensure that it remains fit for purpose. That is a substantial piece of work. As part of it, I can give the noble Lord the specific assurance that he asked for: the Government will consider the extent to which that regulatory framework can provide robust protections for logbook-loan borrowers and third parties who may unknowingly buy a car subject to a logbook loan. On that basis, I hope the noble Lord will feel able to withdraw his amendment. I have every confidence that, even if he does, he will continue to knock at the Government’s door.
Lord Stevenson of Balmacara (Lab) [V]
My Lords, I thank all those who have spoken on this amendment and those who spoke in Committee on this issue. It must be obvious that I think the case for reform here is unanswerable and that we need to move forward as soon as we can. The Minister made a kind reference to my assiduous pursuance of this over the last four years; I can assure him I have only just warmed up. I have plenty more capacity now that I have stepped back from the Front Bench and this remains one of my main targets—so I will be calling again in the near future.
I was slightly struck by the rather defensive notes in the early part of his speech, because I do not honestly think there is much you can say about bills of sale other than that, ironically, when they were first introduced—although not in Scotland—they were in essence an early form of consumer protection. What has gone wrong, of course, as he mentioned, is that the considerable collateral damage to subsequent purchasers of goods subject to bills of sale has been devastating for many people. Yes, it is true that the numbers are down, but I do not buy the argument that it is okay to let this egregious behaviour carry on simply because there are not very many. Every single person affected by this is affected in a most extraordinary way, and it should not happen.
Lord True (Con)
My Lords, I thank those who have spoken. I have to say to many of them that, with great respect, I will disagree that these amendments are appropriate or effective. I must make absolutely clear that there is no prospect of the Government changing their position between now and Third Reading.
I want to start by emphasising, however, that the Government take this issue extremely seriously. I believed that that was understood in the private conversations that I felt privileged to have with Peers from all around the House and that the earnestness of Ministers in this area was understood and respected. I hope that that is the case, even if we disagree today.
We have a great deal of sympathy for mortgage borrowers who are unable to switch to new deals, which is why we and the FCA have carried out so much work and analysis in this area. The FCA has determined that there are around 250,000 people whose mortgages are currently held by inactive firms. That figure has been used by the noble Lord, Lord Sharkey, and others. The noble Lord, Lord Stevenson of Balmacara, said that I might detail different categories of people within that number and implied that that would not change the position. However, as my noble friend Lady Noakes observed, Parliament must surely legislate on the basis of actual numbers and evidence of the reality of the problem overall. While that figure is the total number of customers whose mortgages are held by inactive firms, not all those people are “prisoners”. Half of them, 125,000 mortgage holders, could switch to an active lender if they chose to. They could do so right now, without any action or intervention from government at all.
The Government have sought to make it as straightforward as possible for customers with inactive firms to switch. Whenever we have sold loans back to the private sector, we have included protections to ensure that customers’ ability to remortgage is unaffected. For example, the customer protections in previous sales of Bradford & Bingley and NRAM loans have included restrictions on the ability of lenders to impose financial barriers to remortgaging such as early repayment charges.
This means that there are around 125,000 borrowers with inactive firms who cannot switch, and the Government fully accept that that remains a significant number. Within that number, every household is a household of people. However, around 70,000 of those borrowers are currently in arrears. The Government do not underestimate how stressful it can be to be in arrears, but it is important to note that borrowers in arrears with inactive firms are in a similar situation to borrowers in arrears with active lenders. In both cases, it is not possible to move to a new fixed rate deal and it is not possible to switch lender. Customers in arrears with either inactive firms or active lenders have the same protection under the FCA’s conduct rules, whereby firms are required to make all reasonable efforts to explore arrangements to resolve the situation.
Around 55,000 customers are up to date with their payments but are also unable to switch. These consumers are constrained from switching because they do not meet the risk appetite of lenders in the active market. This is not to blame or accuse people in this position—of course, the Government do not do that, and I repudiate any such implication—but it is a simple point of fact that these borrowers have risk characteristics meaning they are unable switch to the active market. However, FCA analysis has found that, despite this, on average the 55,000 borrowers with inactive firms who have characteristics that would make it difficult for them to switch but are up to date with payments are paying around 0.4 percentage points more than similar borrowers with active lenders who are now on a reversion rate, which will normally be their lender’s standard variable rate.
There has been considerable scrutiny of this figure, and the noble Lord, Lord Sharkey, simply claimed it was wrong, so I will take a moment to explain the analysis that underpins it. The FCA used its regulatory data returns, information from the third-party administrators who service these mortgages, and credit reference agencies to compare the interest rates paid by borrowers with inactive lenders to borrowers with similar characteristics in the active market. As my noble friend Lady Noakes stated, consumers with these kinds of risk characteristics would not be able to easily access new fixed rate deals in the active market. It is not the case that borrowers with similar high credit risk characteristics can access the lowest rates in the active market. Where they can access new fixed rate deals with active lenders, these will tend to be specialist lenders who will charge much higher rates than the major lenders.
My noble friend Lord Holmes of Richmond reasonably asked what the Government are seeking to do. Importantly, the Government, working with the FCA, have created additional options for some of these 55,000 borrowers who are with inactive firms but are not in arrears. This involves a new process, for which I believe time should be allowed, that permits active mortgage lenders to waive the normal affordability checks for borrowers with inactive lenders who meet certain criteria, for example not being in arrears and not wishing to borrow more. This is called the modified affordability assessment.
Inactive firms have been contacting borrowers who have been struggling to switch, setting out that new options may be available for them in the active market. I am pleased to tell the House that a number of lenders, including major lenders like Halifax, NatWest and Santander, have also come forward with options specifically for these borrowers. I encourage all borrowers with inactive firms to consider whether they may be able to take advantage of this new switching process. While this may not be a silver bullet for all borrowers with inactive firms, it represents a significant change for borrowers with inactive firms who may previously not have been able to switch.
The Government have taken other action in the period of Covid to help and support borrowers. In October, the FCA confirmed additional options to support borrowers, including guidance to allow borrowers who are up to date with their payments with a recently matured or soon-to-mature interest-only or part and part mortgage to delay repaying the capital on their mortgage while continuing to make interest payments. This guidance is in place until October 2021. The FCA also confirmed, as I have explained, that it is making intra-group switching easier for borrowers with an inactive firm; that is, the same lending group as an active lender. Furthermore, in September the Money and Pensions Service launched online information and a dedicated phone service for borrowers.
We have also considered the regulation of customers with inactive firms. It is important to be clear that all borrowers with regulated mortgages must always have their mortgages administered by a regulated firm—this is the case for both inactive firms and active lenders. Some inactive firms, such as Landmark Mortgages and Heliodor Mortgages, are also regulated by the FCA already.
As the Economic Secretary to the Treasury and we have explained, the Government are always open-minded about whether further regulation would deliver greater protection, but we are yet to see evidence to suggest that there are borrowers who are currently being harmed by the current regulatory regime in relation to borrowers in the active market, and who would therefore be helped by extending the FCA’s remit.
Amendments 21 and 37B seek to provide additional protections for borrowers with inactive firms through direct price intervention by the FCA and the Treasury. Amendment 21 seeks to cap standard variable interest rates for borrowers with inactive firms. My noble friend Lady Noakes spoke powerfully on the implications of this policy. As I have discussed, borrowers with similar characteristics in the active market are unlikely to be able to secure new fixed-rate deals in the active market. As my noble friend argued, a cap for borrowers in the inactive market would be deeply unfair to higher-risk borrowers or those in arrears with active lenders, who would continue to pay normal reversion rates, which would be higher than the cap proposed.
Capping SVRs on mortgages with inactive firms would also have an impact on their financial stability because it would restrict lenders’ ability to vary rates in line with the market conditions. I know that some in the House found my noble friend’s speech uncongenial, but this is a fact. This concern was supported by the London School of Economics’ recent report on mortgage prisoners, which stated:
“Capping SVRs at a level close to the best rate for new loans could create harm in other parts of the market, and we do not recommend it.”
Both Amendments 21 and 37B would also require inactive firms and unregulated entities to offer new fixed-rate deals. On Amendment 21, it is not clear how the FCA should take account of the range of features and characteristics that inform interest rates in the active market—for example, product fees or borrower characteristics. Amendment 37B seeks to require the Treasury to implement regulations that provide fixed-rate deals to customers with inactive firms that are in line with deals available to borrowers in the active market with broadly similar creditworthiness characteristics.
As I have noted already, FCA analysis has made clear that borrowers with inactive firms who are up to date with their payments but unable to switch on average pay just 0.4 percentage points more than customers in the active market with similar characteristics who are now on the reversion rate. Therefore, it is not clear that this amendment would lead to materially lower rates for most consumers with inactive firms.
Being with an inactive firm does not stop a consumer from applying for mortgages in the active market. Consumers in the inactive and active market applying for new credit are assessed in the same way. Consumers in the inactive market are already able to access mortgage products available to consumers in the active market with broadly similar creditworthy characteristics.
Finally, both Amendments 21 and 37B would require firms that do not currently have the expertise, systems or regulatory permissions necessary to offer new mortgage products to do so.
I reiterate that the Government do not underestimate the stress that being unable to switch your mortgage can cause. I also reiterate that the Economic Secretary has stated the Government’s concern and interest in seeking ongoing solutions to this problem. However, in making policy we must be guided by the evidence, which demonstrates that consumers with inactive firms are not in fact significantly disadvantaged versus their peers in the active market, and we must be fair to those borrowers—to all borrowers—in any steps we take. In view of this and the proportionate range of interventions that the FCA has already taken, some of which I set out in the earlier part of my speech, I ask that the amendment be withdrawn.
People with Disabilities Standing for Elected Office
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Baroness Jolly
To ask Her Majesty’s Government what support they intend to provide to assist people with disabilities with the additional financial costs associated with standing for elected office.
The Minister of State, Cabinet Office (Lord True) (Con)
My Lords, it is the Government’s ambition to see more disabled people in public office. The Government have been clear that the responsibility for supporting disabled candidates sits with political parties and that the EnAble Fund was an interim measure to give parties time to put their own support in place. Ministers wrote to the main parties twice in 2019 to ask them how they intend to support their candidates on a long-term basis.
Baroness Jolly (LD) [V]
My Lords, I am grateful to the Minister for his response. I am sure he would agree that it is important that people with a disability are represented in Parliament. Can he tell the House how many MP’s have a disability, and, in the last election where financial support was given to candidates with a disability, how many candidates were supported?
Lord True (Con)
My Lords, I do not have all those specific figures. In relation to the EnAble Fund, 41 applicants were awarded funding and 19 were elected. Some 33 disabled candidates for the 2019 local elections received financial support through the fund, and of these 15 were elected. I will write to the noble Baroness on her other question.
Lord Dodds of Duncairn (DUP) [V]
My Lords, as the Government prepare their national strategy for disabled people, does the Minister accept that more must be done to facilitate disabled people, who face enormous challenges in seeking elected office? Will this issue be included in the strategy? Is it not time to consider reinstating some kind of financial support, given the staggeringly low number, proportionately, of disabled people in elected office in this country?
Lord True (Con)
My noble friend makes an important point on which all parties would, I hope, unite. The reality is that the law regarding electoral expenses, permissible donors and grant-making is complex, and therefore the funding model has always been to contract with other organisations to deliver funding to political candidates. But I note what my noble friend says.
Lord Holmes of Richmond (Con)
My Lords, does my noble friend agree that the Government may be able to perform a useful convening role with political parties, to gain more traction on this issue? In 2018, I was commissioned to produce a report on increasing access to public appointments for disabled people. Unfortunately, many of its recommendations remain unaddressed. Could I gently ask my noble friend whether the Cabinet Office could help get some more traction on this and on working together to get more disabled people into public life and public appointments, which play such an important part in our society?
Lord True (Con)
I certainly agree with my noble friend about public appointments. I am sorry to hear what he said about his report. Certainly, it is the Government’s wish to encourage more disabled people into public appointments. We wrote twice to political parties in 2019; at that time, there were not responses.
Baroness Campbell of Surbiton (CB) [V]
My Lords, it is well understood that there are multiple barriers faced by disabled people pursuing elected office that can be addressed only by providing adequate financial assistance. Would it therefore be helpful if the Government were to consider establishing an Access to Work model to assess the needs of disabled candidates and provide funding for reasonable adjustments? Such a tried and tested system would address many of the additional costs of standing for political office. It is work, and Access to Work is for work.
Lord True (Con)
My Lords, I will ensure that the important suggestions put forward by the noble Baroness are taken into account as we go forward. I reiterate the Government’s desire to see more disabled candidates for all parties.
Baroness Pitkeathley (Lab) [V]
My Lords, does the Minister agree that in the process of managing their disability, or the disability of someone they care for, people learn many skills, both practical and organisational, that are useful in public life and elected office? As the Government are rightly—[Inaudible]—will he also agree that it makes sound economic, as well as moral, good sense to give financial support to ensure that these much-needed skills are not lost?
Lord True (Con)
My Lords, I agree with the noble Baroness’s point about skills. I do not wish to repeat the point I made about the difficulty of direct funding. After the 2019 election, we put out an invitation to tender, seeking an independent scheme administrator to help retrospectively, but unfortunately we did not receive a response.
Lord Tyler (LD) [V]
My Lords, we all appreciate the efforts that the electoral administrators are making currently to assist disabled voters in the circumstances that we face. Since the Minister has acknowledged that the risk of fraud from large-scale postal voting is much greater than from cheating in polling stations, is he confident that all necessary precautions are in place for May’s elections? In particular, with the return of postal vote applications to the authorities, will he do everything possible to prevent political-party interference, as apparently happened with the Conservative association in Mr Gove’s constituency?
Lord True (Con)
My Lords, I will not pursue the noble Lord’s political allegations. This Government have a desire, which I hope all parties share, to avoid all fraud in elections. In the Covid situation, we need to take action, including late emergency proxies to enable all to cast their vote.
Baroness Gardner of Parkes (Con) [V]
My Lords, what steps are the Government taking to monitor the number of disabled candidates in the forthcoming elections? How will they use that information to inform government strategy to ensure that more disabled people stand for election?
Lord True (Con)
My Lords, my noble friend raises an important point. The Government are reviewing evidence on the best ways to encourage more disabled people to run for elected office. An empirical understanding of how many have tried and how many have succeeded is important. I gave some of the figures earlier, and I will provide more in my response to the noble Baroness, Lady Jolly.
Baroness Wilcox of Newport (Lab) [V]
After scrapping the EnAble fund, apparently the Government are considering options for future support for disabled election candidates in connection with the national strategy. But disabled people deserve more than a consideration of options. Does the Minister agree that disabled people seeking elected office need a permanent fund to assist in removing the barriers that they face?
Lord True (Con)
My Lords, not repeating the Government’s view that we believe responsibility for supporting disabled candidates sits primarily with the political parties, and that the EnAble fund was a temporary interim, I agree that disabled people seeking elected office face a broad range of barriers; that is true, and not all are financial. The forthcoming evaluation of EnAble will help the Government understand all those aspects.
Baroness Falkner of Margravine (CB)
My Lords, I declare an interest as chair of the Equality and Human Rights Commission. I hear what the Minister is saying about the responsibilities of political parties. I agree, but does he also accept that Article 29 of the UN Convention on the Rights of Persons with Disabilities sets out obligations on the state to guarantee disabled people’s political rights, including the opportunity to be elected on an equal basis with others?
Lord True (Con)
My Lords, the Government’s desire is to facilitate participation. I think the House is unified behind that. The question is how we best overcome the barriers, both financial and non-financial, and that is what we are all working on.
Baroness Bakewell of Hardington Mandeville (LD) [V]
My Lords, I hear what the Minister says about the responsibility resting with political parties. However, enormous costs can fall on those who have additional needs. What plans do the Government have in conjunction with political parties to encourage the disabled to stand in this coming May election, which is only around the corner?
Lord True (Con)
My Lords, I commend what political parties are doing to seek to involve disabled candidates. We have evaluated the central fund’s run; the access to elected office fund was expensive to administer, and the evaluation published in 2018 found that its impact on increasing participation by disabled people had been negligible. Going forward, we have to consider all these factors but keep the central objective of more disabled people in Parliament and council chambers in sight.
Representation of the People (Proxy Vote Applications) (Coronavirus) Regulations 2021
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Representation of the People (Proxy Vote Applications) (Coronavirus) Regulations 2021
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The Minister of State, Cabinet Office (Lord True) (Con)
My Lords, across all parties and none, we are all resolved that democracy should not be cancelled because of Covid. The Government have confirmed that the election scheduled for May will go ahead and are providing a package of measures to support the statutorily independent returning officers to deliver these elections successfully and with the right precautions in place. Those measures were set out in a delivery plan published by the Government on 5 February.
These draft regulations would temporarily change the eligibility criteria for emergency proxy applications, so that electors who are self-isolating due to coronavirus on election day have an additional option to vote remotely. The provisions in this SI would also allow those with an existing proxy to change the person acting as their proxy if their original proxy were affected by coronavirus.
The last opportunity for a routine proxy application is at 5 pm six working days before election day. After this deadline, the only other option to create a new absent voting arrangement is to apply for an emergency proxy vote. Emergency proxy applications on medical grounds are usually required to be attested by a medical professional. Not everyone will be able to seek such attestation—for example, those who become symptomatic with Covid too late to take a test. The statutory instrument would remove this requirement for those affected by Covid. Removing attestation will also avoid adding more pressure on already busy medical professionals.
Furthermore, if an elector was informed that a member of their household tested positive for coronavirus but they were unable to evidence that they also had the virus, under current regulations the elector would be ineligible to apply for an emergency proxy vote even though they ought to remain at home. This statutory instrument will remove these limitations for those affected by Covid-19 and provide a more flexible approach for those who ought to remain at home on election day.
The changes proposed would mean that, if an elector believed that their particular circumstances would lead to an increased risk of transmission of the coronavirus to themselves or others in a range of circumstances, they would be eligible to apply for an emergency proxy vote. For example, an elector who has been made aware they may have been exposed to the virus at home or work in the days leading up to the election can apply for an emergency proxy vote even if they are not yet showing symptoms.
Beyond removing attestation, the usual security measures for absent voting applications—such as the signature requirement, providing date of birth, and the requirement that electors declare that they understand that all the information provided is true and that providing false information to an ERO is illegal—remain in place.
Electors who are granted emergency proxies will be included in the absent voting lists, which are available to candidates and agents on request, for the express purpose of ensuring scrutiny and integrity.
These temporary changes are both necessary and proportionate to ensure that those affected by coronavirus can still exercise their right to vote. This SI does not affect the regulations regarding any other route for emergency proxy applications. Almost all provisions in it will expire at the end of February next year, so will not apply to any regularly scheduled elections, such as those in May 2022.
The only permanent provisions in this SI simply clarify and add certainty to the existing position that electors with long-term proxy arrangements, such as those with a disability, can replace the person acting as a proxy without having to go through the entire application process again. Going through the full application process would require an elector to prove their eligibility for a long-term proxy vote again, simply to change the person who was their proxy; that should not be necessary.
The statutory instrument has been considered by both the JCSI and the SLSC, neither of which has drawn the attention of the House to it. For the avoidance of doubt, I should state that we have consulted the Electoral Commission, which is supportive of the proposed changes. We also shared a draft of the SI with the Association of Electoral Administrators, SOLACE and officials in the Welsh Government.
There is broad support among stakeholders for the proposed changes in the instrument. Both the Welsh and Scottish Governments have put similar measures in place for the polls on 6 May for which they are responsible. It is important that we are able to offer voters consistency of approach wherever possible, and I am pleased that all three Governments are working to support voters in this way. I hope that noble Lords will welcome these proposals. I beg to move.
Lord True (Con)
My Lords, I am grateful to all those who have spoken and acknowledge their great experience in electoral matters. I am not going to exchange election stories with my noble friend Lord Naseby, but I can assure him that the first majority I ever had was a lot smaller than his—not normally what people boast about, but that was the case.
Important points were raised and I shall try briefly to address them. My noble friend Lord Naseby said two things. The first was that he was concerned about fraud. We are all concerned about fraud. There is always a balance to be reached in these things. The noble Lord, Lord Rennard, implied that it is also important to ensure that people are enabled to vote, and that is ultimately what this statutory instrument is about. In the difficult circumstances we face now, with coronavirus, people who are affected by coronavirus at a late stage before the election must be enabled to vote. This is an exceptional circumstance and our judgment is that, whatever the risks my noble friend may fear, it is a reasonable stance that we are taking.
I repeat what I said in opening: it is an offence to provide false information. Electors granted emergency proxies will be included in the absent voting lists, which will be available on request to candidates and agents for scrutiny. We believe that the Government have reached a reasonable balance on that.
The other point my noble friend made was, in a sense, logically not quite on par. Like the noble Lord, Lord Kennedy of Southwark, he asked why this provision is just for a brief period. If I were concerned about fraud, I would not necessarily want to make it a permanent arrangement. I think there is a slight logical inconsistency in the questions, but I understand that my noble friend was coming at it from two different directions.
It is our belief and hope that conditions will have returned to normal by next year and that we should return to the broad established arrangements for elections. Obviously, if the worst happened—and we all pray that it will not—the Government would review it at the time. We believe that it is reasonable to place in the regulations a sunset clause and, indeed, we are often asked in other aspects of coronavirus debates to impose sunset clauses. I hope that answers also the point made by the noble Lord, Lord Kennedy of Southwark. I appreciate his support for the proposed SI, and that of his party, and equally the support put forward by the noble Lord, Lord Rennard.
The noble Lord, Lord Rennard, raised a point about a specific local authority. In my position responding to the Committee, I shall not highlight—or lowlight—any particular local authority. I made the position clear in response to a Question, as he was kind enough to say. Postal or proxy voters must by law supply their date of birth and signature at application, and again when they return their postal ballots at an election or referendum. The legal position is clearly set out in this statutory instrument and elsewhere in electoral law. I am sure that electoral registration officers, who are responsible for processing applications for postal or proxy votes and applying the legislative requirements, have a mind to the law. The points raised are properly for the electoral registration office of Woking Borough Council to respond to, but I take note of what he said. Good practice is good practice and the best practice in line with the law. That is as far as I will go on that matter.
I return to my gratitude to all noble Lords who have spoken, who raised germane and important points to which I have tried to respond. I, and I think they, believe that the instrument makes sensible change to support the effective administration of elections. It gives an option to those electors who must remain at home on election day to cast their vote remotely if they are affected by coronavirus, or to replace a proxy affected by coronavirus if they have already made arrangements to vote remotely.
I did not answer my noble friend Lord Naseby’s question on long-term proxy. Those with long-term proxies often have particular reasons and conditions for having them. In a free society, where a proxy vote is a perfectly legitimate way to vote, people have a choice. They can vote by proxy, in person—although such people cannot often do that—or by post. That is a choice for each elector.
I thank noble Lords most sincerely for their support for the statutory instrument and commend it to the Committee.
Taskforce on Innovation, Growth and Regulatory Reform
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Lord Hendy
To ask Her Majesty’s Government whether the terms of reference of the Taskforce on Innovation, Growth and Regulatory Reform include (1) reviewing existing employment rights, and (2) making recommendations for reform; whether trade unions will be consulted as part of any such review; and when they expect the review (1) to be completed, and (2) to be published.
The Minister of State, Cabinet Office (Lord True) (Con)
My Lords, the terms of reference for the task force have been published on GOV.UK. The task force has been commissioned by the Prime Minister to consider opportunities for regulatory reform independently, and to report to him in April. It is a matter for the task force to decide its focus within its terms of reference, and a matter for the Prime Minister as to whether the report will be published.
Lord Hendy (Lab) [V]
My Lords, I thank the Minister for his Answer. On 19 January, BEIS confirmed that a post-Brexit review of workers’ rights was under way; on 25 January, it was confirmed that the plan had been scrapped; on 2 February the task force was announced with a remit to
“scope out … how the UK can take advantage of our newfound regulatory freedoms”.
The chronology provokes nervousness but, for the moment, I do not pursue the reduction of workers’ rights. Instead, I ask: who outside government is being consulted and when will we see the Government’s employment Bill?
Lord True (Con)
My Lords, as to the employment Bill, I am not the Minister responsible but I will answer on the matter before the House. I draw the noble Lord’s attention to the third part of the terms of reference, which mentions
“maintaining the Government’s commitment to high environmental standards and worker protections”.
I hope that allays his fears.
Lord Holmes of Richmond (Con)
My Lords, the Covid pandemic has affected young people particularly hard in their education and when beginning their careers. To this end, and in terms of “Build back better” and this task force, will the Government put an end to the pernicious practice of unpaid internships? The Prime Minister and the public are in favour of a prohibition. Does my noble friend agree that this would be a clear illustration of levelling up and a labour market that works for everyone?
Lord True (Con)
Again, my noble friend asks me a question which goes well beyond my remit in the Cabinet Office. I note and respect what he says. The Government’s position is that, for some internships, early years in the labour market can help in securing work and gaining experience. However, he raises important issues. As for the task force issue, that is an independent matter for the task force.
Lord Bilimoria (CB) [V]
The UK has a hard-won reputation, internationally,
“as a great place to set up and scale a business due to its stable and predictable regulatory environment, competitive product and labour markets and dynamic financial sector”.
Regarding the Taskforce on Innovation, Growth and Regulatory Reform, does the Minister agree that we should beware of opportunism at the expense of a more strategic approach and that regulation must be in the service of building a competitive, dynamic and future-focused economy, including net zero, digital, R&D and innovation, and life sciences, for example? Does he also agree that with the UK’s leadership of the G7 and COP 26, we have a chance to reinforce our commitment to international co-operation on equity standards and burnish our credentials as a leading innovator across international regulatory reforms?
Lord True (Con)
I fear I was not able to catch all the matters to which the noble Lord referred. While I do not favour opportunism, I agree that there is great opportunity out there, which flows from the kind of innovation that he describes. Britain certainly intends to be a world leader.
Lord Stevenson of Balmacara (Lab) [V]
My Lords, given the recent Supreme Court decision in the Uber case, does the Minister agree that it is time to unscramble the unnecessary and divisive distinctions still made in statute between workers and employees, and to remove the taxation differences that affect both groups?
Lord True (Con)
My Lords, I note the noble Lord’s comments and will obviously refer them to the Ministers responsible.
Lord Fox (LD)
My Lords, in the terms of reference to which the Minister referred, the aim of TIGRR is to “reduce administrative barriers”. Since January, hundreds of thousands of businesses have started to encounter extreme administrative barriers doing things that had previously been seamless. Because of their poor negotiating, the Government have left these businesses—from fishing to cosmetics, advanced manufacturing and food—with miles of new red tape. Does he agree that it is a bit absurd to set up this task force when they have dumped literally container-loads of red tape on British business?
Lord True (Con)
Absolutely not, my Lords. Again, the noble Lord does not show the respect due for the decision of the British people to leave the European Union. The reality is that this task force is asked to look at reducing barriers in whatever context, and I draw his attention to great steps forward. For example, there is the trade agreement with Japan.
Baroness Smith of Basildon (Lab)
My Lords, in response to three questions today, the Minister has said that he cannot answer because it is not his department. He is no novice at the Dispatch Box. Can I gently remind him that at the Dispatch Box he answers on behalf of the Government, not just one government department? My specific question is around the task force that he refers to; none of the questions on it should be a surprise to him at all. I have read the terms of reference. They are about business, environmental standards and workers’ protection, but the only members of this task force are three Conservative MPs. Does he think it has any credibility when there are no representatives of employers or employees on the task force? Would it not have been better set up as a Conservative Party task force, to report to the leader of the Conservative Party, rather than being able to get Civil Service support when it is clearly just a Conservative Party body?
Lord True (Con)
My Lords, I disagree. As to the first part, of course I acknowledge that I answer on behalf of government, but the competence of a Minister to answer on specific questions outside his departmental responsibility is not always the same as that of the Minister responsible. I refer comments on, as I said in another answer. Concerning the second part of the noble Baroness’s question, it is entirely reasonable for any Prime Minister to seek blue-sky thinking, and ideas outside and in parallel to the Government. Mr Blair, for example, did exactly that when calling in the noble Lord, Lord Birt.
Baroness McIntosh of Pickering (Con) [V]
My Lords, will my noble friend confirm whether the remit covers the plight of part-time working women, particularly those who work, for example, in supermarkets on zero-hour contracts and who have no rights to paid holidays, sick pay or pensions? What is the value of what would be a worthwhile exercise in having the task force if the results are not to be published?
Lord True (Con)
My Lords, I did not say that the results were not going to be published, but that it would be a matter for the Prime Minister whether they will be. That will happen after the report is presented, at the end of April. On the specific issues concerned, as I have said before, I will draw my noble friend’s points to the attention to those responsible. I am sure that within the terms of reference it would be open to them to look at some of the issues she describes.
Baroness Wheatcroft (CB) [V]
On 31 January, Sir Iain Duncan Smith wrote in the Daily Telegraph that
“Despite what the naysayers have said, their worst predictions have not come to pass—goods continue to flow”.
In fact, the ONS reports that exports to the EU were down 40% in January, in part due to the increased regulation brought about by Brexit. Does the Minister believe that Sir Iain Duncan Smith will bring a suitably realistic approach to chairing the task force, rather than the sort of blue-sky thinking in that Telegraph article?
Lord True (Con)
My Lords, my right honourable friend Sir Iain Duncan Smith has an extraordinarily distinguished record in government in working on behalf of underprivileged people and the poor. I am sure that he will bring a very open mind to this task.
Baroness Clark of Kilwinning (Lab) [V]
I declare an interest in that I am a member of the GMB trade union, which has spent the last five years fighting legal battles on behalf of Uber drivers. The Supreme Court ruled last month that Uber drivers were indeed workers, which means that they are entitled to holiday pay, the minimum wage and all the other benefits of being classified as workers. Does the Minister welcome the Supreme Court’s decision and undertake that the Government will bring forward emergency legislation to clarify the position of gig economy workers and address the problem of bogus self-employment?
Lord True (Con)
My Lords, again, that goes beyond my specific remit but I will draw my colleagues’ attention to what the noble Baroness says. Of course the Government consider with respect any judgment made in the courts. I assure her that among those organisations which I understand the task force has reached out to are trade unions.
The Senior Deputy Speaker (Lord McFall of Alcluith)
My Lords, the time allowed for this Question has elapsed.
COVID-19 Vaccine Certification
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Lord Harris of Haringey
To ask Her Majesty’s Government, further to the statement by the Prime Minister on 23 February (HC Deb, col 627), when they will provide further details of their review of the potential role of COVID-19 vaccine certification; and what organisations will be involved in that review.
The Minister of State, Cabinet Office (Lord True) (Con)
My Lords, as set out in the Covid-19 response document published last week, the Government will review whether Covid status certification could play a role in reopening our economy, reducing restrictions on social contact and improving safety. My right honourable friend the Chancellor of the Duchy of Lancaster will lead the review, and he is currently considering the approach to its conduct.
Lord Harris of Haringey (Lab) [V]
Covid passports would make things easier for travellers, care homes, venues and businesses, but there are also concerns about confidentiality and straying into making vaccines compulsory. Proper consent for any system of certification is vital, and the Government need to consult on this quickly and widely. How will that be done? There are also other issues, such as the risks of forgery and of people borrowing other people’s certification. How will those inspecting a Covid passport know, in the absence of a proper ID card or identity assurance system, whether the person presenting it is who they say they are and whether the certification applies to that person?
Lord True
My Lords, the noble Lord rightly sets out a number of issues that will have to be considered as the review goes forward. As the Prime Minister has said, there are deep and complex issues that we need to explore. We shall certainly draw on outside advice and opinion as we go forward.
The Lord Speaker (Lord Fowler)
I call the noble Lord, Lord Triesman. He is not here, so I call the noble Lord, Lord Scriven.
Lord Scriven (LD) [V]
My Lords, how will the Government mitigate the risk that introducing vaccine certificates will move toward a system of individual risk-scoring that could undermine public health by treating a collective problem as an individual one and reduce compliance with vital individual public health measures?
Lord True
My Lords, again, the noble Lord raises important considerations. As I have said, my right honourable friend is currently scoping areas for the review, and many issues will come up on both sides of the question, which will have to be carefully weighed. I can assure the noble Lord and others that Covid status certificates would not be a form of national identity card.
Lord O’Shaughnessy (Con) [V]
My Lords, last month the Ada Lovelace Institute published a report on the potential of vaccine passports. Among other recommendations, it called for the Government to engage with the public on this topic in order to build trust and legitimacy and also to understand what trade-offs the public are willing to make. What plans do the Government, and the review in particular, have to engage with the public so that we can build trust, not distrust, around status certificates?
Lord True
Again, there are obviously two strands here. There is the strand of international discussion about enabling international travel, which is subject to a review being conducted by my right honourable friend Mr Shapps, and there is the current review addressing the issues that noble Lords have been speaking about. As I have said, these are very early days—the review was announced only last week—but, as the Prime Minister said, we will seek the best scientific, moral, philosophical and ethical viewpoints on the way forward. Obviously, public opinion will be part of that.
Lord Loomba (CB) [V]
My Lords, a Covid variant first identified in Brazil has been found in the UK. Some variants, like this one, appear to be more contagious, and there are concerns that current vaccines may not work as well against them. The UK Government have already announced a deal with the biopharmaceutical company CureVac to develop vaccines against future variants, with a pre-order of 50 million doses. Can the Minister tell us what steps the Government will take to ensure that no vaccine will be approved unless the expected high standards of safety, quality and effectiveness are met as those new vaccines will be developed in as short a time as possible?
Lord True
My Lords, obviously I am not the lead Minister on vaccines, but what I do know, and I think the public know, is that our standards in this country in terms of assessing vaccines are among the highest in the world, if not the highest. The Government would never in any circumstances do anything that would jeopardise the safety of the public.
Baroness Thornton (Lab)
On Monday the European Union announced plans for a digital green pass that will provide proof that a person has been vaccinated against Covid-19, as well as details of tests, and will “facilitate Europeans’ lives”. Are Her Majesty’s Government in discussion with the Commission about this—about working together—and will it be part of the proposed consultation?
Lord True
My Lords, as I say, there is a parallel strand here. The review that was announced is of the potential domestic application of Covid certification; the review of international travel is a separate strand. I can repeat what I have said before at this Dispatch Box: the Government are talking to all partners internationally about the work of trying to facilitate international travel when it is safe to do so. Obviously, we have to respond to the fact that other countries may decide that people need to show vaccinated status as a requirement for entry, but the Government are not currently looking to make it a requirement to have a vaccination certificate to come into this country.
Baroness Walmsley (LD) [V]
My Lords, in considering whether to introduce vaccine certification, will the Government consult organisations representing patients who have been advised by their clinician that it would not be in their interest to take the vaccine? How would such patients be able to navigate a world in which vaccine certification was widely used?
Lord True (Con)
My Lords, the noble Baroness, as ever, raises a very important and sensitive point. The Prime Minister has said that we cannot discriminate against people who, for whatever reason, cannot have the vaccine. I assure her that the review will certainly take that aspect into account.
Baroness Stuart of Edgbaston (Non-Afl) [V]
My Lords, I draw attention to my interests in the register. I want to return to the vaccination certificate on a domestic issue, following on from the noble Baroness, Lady Walmsley. Can the Minister ensure that, whatever system we end up with, it is very narrowly and clearly defined and has the consent of those who are excluded from its benefits as well as those who would derive benefits from having such a certificate?
Lord True (Con)
The noble Baroness makes an important point. As I have tried to indicate in this series of answers—I said at the outset that my right honourable friend is currently scoping the approach—your Lordships’ advice through all this will be very much valued and a range of opinions, including those just expressed, will have to be considered. As the Prime Minister has said, deep and complex issues are involved.
Lord Pickles (Con) [V]
My Lords, in those various discussions, will my noble friend consider the plight of a family travelling together where the adults are vaccinated and have a certificate but the children, including adolescents, are not? Is there a concern that a modern Morton’s fork is created, so that the efficiency and effectiveness of any certificate is undermined identically whether the accompanying children have a Covid-19 test or not? Has my noble friend noted that this dilemma in countries which use a vaccine certificate domestically has resulted in the certificate having only a marginal impact?
Lord True (Con)
My Lords, again, my noble friend brings forward an issue—the situation of a family with children, whether in a pub or travelling—which will have to be considered and addressed. I assure him that his point will be taken into account.
Baroness Bull (CB)
Will the Minister ensure that the review considers the impact of introducing vaccine certificates on the cultural and entertainment sectors, and both the commercial and the ethical implications for them? Any form of passporting will likely impact disproportionately on those communities already excluded, and the integration of health data into cultural participation is a worrying shift from the social to the medical model of disability. Can the Minister confirm the review will include a full equality impact assessment?
Lord True (Con)
My Lords, as I have said, my right honourable friend is currently scoping the approach to the review. On the point made by the noble Baroness, I repeat what the Prime Minister said: we will reach out to get the best moral, philosophical and ethical viewpoints on this issue. That will include all the points raised in this House today.
The Lord Speaker (Lord Fowler)
My Lords, the time allowed for this Question has elapsed. That brings Question Time to an end.