Terror Attacks: Government Financial Support

Debate between Afzal Khan and Steve Barclay

Wednesday 6th December 2017 Westminster Hall

[The Economic Secretary to the Treasury (Stephen Barclay)]

It is a pleasure, as always, to serve under your chairmanship, Mr Davies. I thank the hon. Member for Bermondsey and Old Southwark (Neil Coyle) for introducing this important debate. The House is united in our condemnation of the atrocity that was committed against his constituents and those of a number of other colleagues.

The hon. Gentleman expressed his understandable concern about the number of days taken in responding to the certification of terrorism, and what he perceived to be a delay by the Treasury. To clarify, the Treasury responded to the certificate within 48 hours of its receipt. Clearly the police were focusing on the investigation, and that may have played a part in the number of days that it took for the Treasury to receive that certificate, but the Treasury did respond within 48 hours of doing so.

I am very aware of the impact on businesses in the hon. Gentleman’s constituency following the attacks—indeed, he and I met to discuss it with a number of his affected constituents. As he set out, traders in Borough market have had a number of difficulties, particularly in accessing their insurance payments.

Accessible insurance is vital for businesses and individuals. It protects them financially from life-changing losses and gives firms extra security and confidence when going about their regular business. That is why, in 1993, when the insurance market stopped offering terrorism cover following the IRA attacks, the Government stepped in to establish Pool Re. That move was made to provide reinsurance cover, to stimulate the private market and to ensure that businesses could access protection again. Pool Re is now widely regarded as the global leader in the sector, shaping international standards for terrorism insurance cover. Since its launch, Pool Re has successfully reinvigorated the terrorism insurance market in the UK. Pool Re has also protected businesses, paying out more than £600 million, including for the recent attacks in Manchester, for example. The Government are committed to ensuring that Pool Re continues to protect businesses and enables effective terrorism insurance cover. We regularly monitor Pool Re in that context, and agree that in recent years a gap has appeared in its coverage. That is the legitimate point which sits at the core of the hon. Gentleman’s rationale for calling today’s debate.

The gap means that some businesses may not be insured for a loss of income in specific circumstances, where losses are incurred due to a terrorist attack but there is no physical damage. The lack of physical damage is particularly material in this instance. The Government recognise the need to address that, and I can therefore confirm that we are exploring options, including legislation, and aim to confirm our next steps early in the new year.

We have already shown that we are prepared to take action to modernise Pool Re and to support businesses in the UK. We recently finalised changes to the scheme, meaning that it will include cover for physical damage caused by a cyber trigger. That precautionary measure helps to future-proof Pool Re, and demonstrates our commitment to maintaining the UK’s position at the forefront of those nations reinforcing their economies against terrorism risks. In terms of Government funding in response to terrorism, we are ensuring, across Government, that affected communities have the right support in place to rebuild and recover from such attacks.

[Afzal Khan (Manchester, Gorton) (Lab)]

I thank the hon. Member for Bermondsey and Old Southwark (Neil Coyle) for securing the debate. I am the Member for Manchester, Gorton, and this year we experienced an attack in which 22 people were killed. Manchester then set up the “We Love Manchester” emergency fund in conjunction with the council, which raised millions of pounds. Communities and faith groups provide assistance after attacks, not just the Government and non-governmental organisations—something that will be highlighted in the all-party parliamentary group on British Muslims’ upcoming report on faith as an emergency service. What support is being given to those groups to continue their work, and what is the Minister doing to combat fake charities set up to raise funds after attacks or tragedies?

[Stephen Barclay]

The hon. Gentleman raises a legitimate point. None of us wants to see charities being set up to defraud by exploiting the good will of our constituents in response to such atrocities. He may be aware that the Prime Minister has established a Cabinet Office taskforce to co-ordinate the cross-Government response, to oversee progress and to expedite payments when necessary. She has recognised the issue and is engaged in addressing it.

I am also pleased to confirm that NHS England has made money available to the NHS north region to reimburse it for its efforts in respect of the Manchester attack. Unfortunately, some of the health effects will be long term, as I am sure the hon. Gentleman recognises. That is why another £1.6 million will be made available to provide mental health support for those affected. NHS England has also provided £1 million to the NHS London region for 2017-18 to assist the health system with meeting the costs of the additional mental health support required following the unprecedented level of major incidents that have occurred in London recently, including, of course, Grenfell—a further tragedy that we have debated in the House.

Although we must respond and have responded robustly to the immediate fallout of such atrocities, we must also focus on reducing the terror threat. Cross-Government spending on counter-terrorism is increasing by 30% in real terms from 2015 to 2020, and £700 million has been allocated to counter-terrorism policing this year. Furthermore, the Treasury has provided £24 million of additional funding to help meet costs arising from this year’s terror attacks that have affected police forces.

To conclude, I commend the hon. Member for introducing the debate, and for campaigning on behalf of the affected businesses in his constituency. The Government recognise the issue and are working closely with the relevant bodies to reach an appropriate solution. We always hope that we will never have to deal with yet another atrocity, but we must be prepared so that our communities, and the businesses and individuals who make them, do not unduly suffer from horrific attacks on our democracy.

Question put and agreed to.