COP10: WHO Framework Convention on Tobacco Control

Debate between Andrea Leadsom and Christopher Chope

Thursday 18th January 2024 Westminster Hall

[The Parliamentary Under-Secretary of State for Health and Social Care (Dame Andrea Leadsom)]

It is a real pleasure to serve under your chairmanship today, Mr Vickers. I thank all colleagues who have taken part in this Backbench debate, especially my hon. Friend the Member for Northampton South (Andrew Lewer) for his leadership in organising it. It has been very interesting, and I can absolutely assure colleagues that I have learned some new things myself today.

To tackle the very first question, I do not intend to go to Panama for COP10. That is because I am preparing flat out for our smoke-free generation Bill, including the response to the consultation and the measures. I just do not think it would be a good use of my time to travel on 5 February. However, the Government will be represented by our excellent colleague from the civil service, Dr Jeanelle de Gruchy, who has done fantastic work representing the UK’s position.

I will give a rough overview of the UK’s position. There will be discussion about global progress on tobacco control. Of course, the UK is an outlier on the topic of vapes, and we will be putting forward our position that vapes are a very important tool for helping adults to quit. There will be some discussion on advertising and sponsorship. The UK has no plans to implement further restrictions on advertising and sponsorship, particularly in the COP’s desire to see further restrictions implemented. On novel and emerging tobacco products, different parties take different approaches. At the moment, the UK is still looking at issues around heated tobacco, so the UK delegation will be in listening mode. In terms of parties going further on tobacco control, certainly the UK Government would welcome other parties going further to protect people, but we will be monitoring the negotiations to ensure that nothing becomes mandatory. Finally, there will be discussions on whether there should be an increase in assessed contributions. The UK intends to press for contributions to stay where they are now. I am very happy to provide a statement to the House after COP10, giving feedback on exactly what happened. I think that covers a lot of the issues raised by colleagues. I hope that was clear, and I would like to again thank everyone for attending.

As has been pointed out, the framework convention on tobacco control was the first treaty negotiated through the World Health Organisation. However, as colleagues will appreciate, I am not one to get misty-eyed about international conventions, or indeed international regulatory frameworks. I am not terribly romantically attached to this, and I feel that the UK’s sovereignty is actually the most important aspect. My priority as the Minister will be to help us in the UK protect our citizens from harm. Is there not a song that goes, “I did it my way”? The UK has a world-leading approach to reducing harms from tobacco and nicotine, and we will continue to do that.

The conference of the parties has, however, been a helpful way of keeping strong tobacco controls at the top of the global health agenda. It is also, as I hope I have just illustrated, a very useful forum for sharing best practice. All papers are presented and all decisions made are published online via the dedicated COP10 website. The UK remains committed to the convention, because we are a world leader in tobacco control. Like many friends around the world, we want to see a tobacco- free future. Next month’s conference will be a fantastic opportunity for us to showcase the UK’s strength, being at the cutting edge of a smoke-free generation. As I have said, our deputy chief medical officer, Dr Jeanelle de Gruchy, is the chief delegate. I have every confidence that our team will encourage other countries to follow in our example.

Now, my hon. Friend the Member for Northampton South is a big fan of common sense, and so am I. I want to reassure everybody that our delegation will be bound by common sense, and not by conference decisions that run contrary to common sense, or indeed to decisions that run counter to our national interest. That includes the decisions we take in helping smokers to quit through quit aids such as vapes and nicotine replacement products. We are a sovereign nation, and it is not within the WHO’s remit to intervene in our internal affairs.

Last week, I was given a couple of opportunities to update the House on our progress towards a smoke-free generation. With permission, I would like to reiterate a few of the points I made then. Our new tobacco and vapes Bill will save lives. Unlike other consumer products, there is no safe level of smoking: it is a product that kills up to two thirds of its long-term users, causes 70% of lung cancer cases, and massively increases the risk of stillbirth. It causes asthma in children; dementia, stroke and heart failure in old age; disability and early death. Almost every minute of every day, someone is admitted to hospital because of smoking, and up to 75,000 GP appointments every month can be attributed to smoking. It takes a massive toll on both our health and our NHS.

Smoking also takes its toll on our economy. Detractors will say, “But what about the £10 billion a year the Treasury gets from taxes on tobacco—how will the Chancellor do without that?” But independent analysis shows that the overall cost of tobacco to society totals £17 billion a year, completely offsetting—and then some—whatever we receive in taxes. The cost of smoking is equivalent to the annual salaries of more than half a million nurses, almost 400,000 GPs, 400,000 police officers or 400 million GP appointments. Reducing smoking rates will bring down those costs and help our economy to become more productive. Our modelling suggests that the smoke-free generation policy we are looking to introduce will reduce smoking rates in England among 14 to 30-year-olds to close to zero by as early as 2040, and will provide cumulative productivity benefits of up to a staggering £85 billion over the next 50 years. That is why bold action is necessary. We are making history with this Bill.

I took up smoking at 14 and gave it up as my 21st birthday present to myself. It was not easy. To this day, I hate talking about smoking because I sometimes think, “I’d quite like a cigarette”, but I shall never be tempted. It is so hard to quit. To those hon. Members who mentioned that nicotine is not bad in itself—yes, it is; it is desperately addictive. When people try to give up nicotine, they suffer cravings and get irritable. It is really difficult to give up nicotine, no matter how it is consumed. Combustible tobacco certainly has all sorts of other horrendous health issues, but nicotine itself is not a harmless product by any means. There is no safe level of nicotine consumption.

Like so many smokers, I desperately wanted to give up this lethal addiction. We want to help more smokers than ever to quit through significant new funding and support. All smokers deserve our support to quit and lead a healthier, longer life, which is why we have announced we are doubling the funding to stop smoking services across England to a total of £138 million a year, to help around 360,000 people quit every year. We are also backing these efforts with substantial new money to support marketing campaigns. As my right hon. Friend the Member for Clwyd West (Mr Jones) and my hon. Friend the Member for Northampton South both pointed out, four in 10 smokers think vaping is as bad as, if not worse than, smoking cigarettes. With this substantial marketing support, the stop smoking campaigns will be common sense and easy to use, setting out the facts to help smokers to be able to quit. We will also provide vapes as a quit aid to those who want to stop smoking.

As colleagues will know, I am passionate about helping mums, mums-to-be and new families, which is why I have asked officials to redouble our efforts to tackle smoking in pregnancy. Women who smoke during pregnancy are two and a half times more likely to give birth prematurely. Smoking is also a significant driver of stillbirth. I want to do everything I can to spare parents the heartbreaking tragedy of losing a baby. One in 10 mothers smokes at the time of delivery; this figure rises to one in five in some parts of the country. Pregnant women who receive financial incentives are twice as likely to successfully quit in pregnancy as those who do not. We must also protect pregnant women and their babies from second-hand smoke. We are working to roll out a financial incentive scheme by the end of 2024 to help all pregnant smokers—and, crucially, their partners— to quit.

As I have said, vapes can be an effective tool to help smokers quit. That is why we have committed to providing 1 million vapes to smokers through our “swap to stop” programme. That is a different approach from that taken in the WHO proposals; we are proud to take it, because we know it works.

Along with millions of parents across the country, I am alarmed by the number of children using vapes, a device that should be used only by adult smokers who want to quit smoking. Youth vaping has tripled in the last three years, and one in five children has used a vape. We have a duty to protect children from under-age vaping while their lungs and brains are still developing, so we are taking decisive action to reduce the appeal and availability of vapes.

In our recent public consultation, we sought views on restricting flavours, point-of-sale displays and packaging, and on restrictions on disposable vapes. We will take tough new action to reduce the appeal and availability of vapes to children through the tobacco and vapes Bill.

I totally get the point that my hon. Friend the Member for Northampton South made about flavours. These are all areas that are being carefully looked at, but he will appreciate that Cherryade, Yazoo and bubble-gum flavours are not really designed for him and me. Packages that look like a little Coke bottle, or are brightly coloured, like a bubble-gum package, are marketed not at him, but at children. Of course we see the vape stand right next to the sweets stand, and vapes are sold, conveniently, at pocket-money price, so let us not be naive about this. A lot of the flavours and colours are specifically designed to appeal to children, and that has to stop. A strong approach to enforcement is a crucial part of making sure that it has a real-world effect.

Under-age and illicit sales of tobacco, and more recently vapes, are undermining the Government’s work to regulate the industry and protect public health. We are cracking down on this appalling illicit trade by backing enforcement agencies, including Border Force, His Majesty’s Revenue and Customs and trading standards, with £30 million extra per year. In the tobacco and vapes Bill, we will introduce powers to give on-the-spot fines, to tackle under-age sales.

[Sir Christopher Chope]

Will my right hon. Friend comment on the undue influence of China on the WHO, as exemplified in my remarks? China is trying to ensure that its policies are adopted by the WHO, and it seems to be funding the WHO and controlling it. Should we not be concerned about that?

[Dame Andrea Leadsom]

I will look into my hon. Friend’s concerns and respond to him in writing. That is probably the most helpful I can be, because that is not something that I have been briefed on. I am, as are all hon. colleagues across the House, concerned about the undue influence of China on public policy that finds its way into national policies. I am grateful to him for raising the issue.

Divorce, Dissolution and Separation Bill [Lords]

Debate between Andrea Leadsom and Christopher Chope

Committee stage & 3rd reading & 3rd reading: House of Commons & Committee: 1st sitting & Committee: 1st sitting: House of Commons
Wednesday 17th June 2020 Commons Chamber

[Andrea Leadsom]

Further to the statistic that up to 50% of people said they regretted divorcing, the reasons they gave were things like they felt they still loved their partner and that they missed their partner, so for all the huge number of comments that it is all financial, it is very genuinely emotions.

[Sir Christopher Chope]

This is a very emotional subject, and we ignore that at our peril.

The Bill and the lack of response by the Government to the criticisms that were made on Second Reading lead me to believe that the Government do not really accept the important role that family life has to play in maintaining social cohesion in this country, with the institution of marriage at its heart. The Government almost seem to be venturing down the same route as those who support cultural Marxism. Are the Government inadvertently collaborators with cultural Marxism in seeking to undermine nuclear families?

In the opening speech on Second Reading, the Lord Chancellor said that

“it is often too late to save a marriage, once the legal process of divorce has started.”—[Official Report, 8 June 2020; Vol. 677, c. 95.]

but he sought to avoid the concerns of the Member for Strangford (Jim Shannon) about access to free counselling for those with marriage difficulties, and he cited the Department for Work and Pensions programme of £39 million on reducing parental conflict as the solution.

Business of the House

Debate between Andrea Leadsom and Christopher Chope

Wednesday 13th March 2019 Commons Chamber

[Sir Christopher Chope (Christchurch) (Con)]

My right hon. Friend has said that we would need to have a clear purpose in order to extend article 50, particularly if that was for a short period of time. Can my right hon. Friend tell the House whether she believes that a change of chief negotiator will amount to such a clear purpose?

[Andrea Leadsom]

My hon. Friend gives me the opportunity to pay tribute to the excellent work of the civil service, who have spent the last two and a half years above and beyond the call of duty—so many of them focused on delivering on the referendum. That is something to be proud of.

Business of the House

Debate between Andrea Leadsom and Christopher Chope

Thursday 17th January 2019 Commons Chamber

[Andrea Leadsom]

I thank the hon. Gentleman for his insight and for his encouragement of electronic voting. I fear that there is no clear view on that and that it may even prove more controversial in this House than leaving the European Union, which is one of the extraordinary things about the Houses of Parliament. Nevertheless, I am always willing to talk to him about such things. Of course, when we decant from this place into temporary arrangements, it might be possible to trial different alternatives if the House wants to do so—[Hon. Members: “No!”] As the hon. Gentleman can hear, it is a controversial thought.

The hon. Gentleman asked whether no deal can be taken off the table, but he must surely appreciate that doing that and then stopping preparations for no deal would be a totally incompetent thing for a sensible Government to do. The Government must continue to prepare for all eventualities, including no deal. It is not possible to remove no deal from the table and still abide by the will of the people, as expressed in the referendum.

The hon. Gentleman asks about next week’s motion. I again confirm, as I thought I already had, that it is debatable, amendable and subject to agreement by this House, on a motion that will be tabled on Monday; the statement and motion will be tabled on Monday. I offer the hon. Gentleman a bit of advice from “Winnie-the-Pooh” that I have been dying to give him:

“You can’t stay in your corner of the Forest waiting for others to come to you. You have to go to them sometimes.”

[Sir Christopher Chope (Christchurch) (Con)]

May we have an early debate on collective Cabinet responsibility and what it means in the current circumstances? Will my right hon. Friend undertake to lead that debate, so that she can explain to the House the frustration that we all feel on her behalf at having the 2017 Conservative party manifesto, which she supported on the “Today” programme this week, undermined by treacherous comments from our own Cabinet colleagues?

[Andrea Leadsom]

My hon. Friend is really tempting me, but I shall resist. All my Cabinet colleagues are absolutely in agreement that we will deliver on the will of the people as expressed in the referendum of 2016. We will be leaving the European Union on 29 March. That remains Government policy and we will continue to prepare for all eventualities.

Business of the House

Debate between Andrea Leadsom and Christopher Chope

Thursday 5th July 2018 Commons Chamber

[Andrea Leadsom]

The hon. Gentleman is absolutely right to raise the issue of serious violence. It is a grave concern, particularly, as he points out, in urban areas. Our serious violence strategy is focused on steering young people away from crime and putting in place measures to tackle the root causes. He will be aware that, with our Offensive Weapons Bill, we are seeking to make it much harder for people to gain access to the dangerous weapons that fuel the problem with violence we are experiencing at the moment.

[Sir Christopher Chope (Christchurch) (Con)]

May we have a statement early next week from the Secretary of State for Housing, Communities and Local Government arising from his statement to the Local Government Association conference this week, where he said he had

“no intention of forcing reorganisation on local government where it isn’t wanted or needed”?

As you know, Mr Speaker, reorganisation is neither wanted nor needed in Christchurch, where 17,676 people voted against it in a local referendum. If the Secretary of State came to the House to make a statement, it would give him an opportunity to withdraw the opposition he continues to make in the High Court to Christchurch’s case against the Government. If the Government now withdraw their opposition to Christchurch, we could all live happily.

[Andrea Leadsom]

I am grateful to my hon. Friend for raising this constituency issue again. He will be aware that Housing, Communities and Local Government questions will take place on Monday 23 July, and that is obviously a question that is best directed straight to the Secretary of State.

Business of the House

Debate between Andrea Leadsom and Christopher Chope

Thursday 10th May 2018 Commons Chamber

[Andrea Leadsom]

I am grateful to the hon. Gentleman for his birthday wishes. As ever, I will of course seek to accommodate his requests.

[Sir Christopher Chope (Christchurch) (Con)]

Thank you, Mr Speaker, for so robustly defending the rights of Back Benchers on both sides of the House. Will my right hon. Friend postpone the sitting, scheduled for Monday, of the Delegated Legislation Committee at which the Government propose to abolish Christchurch Borough Council, against the will of the citizens of Christchurch? I ask my right hon. Friend to do so because Christchurch Borough Council, on the advice of leading counsel, has issued a letter before action against the Government, and the Government have asked for extra time in which to respond to that letter. It seems to me that it is reasonable for us to see the Government’s written response to the letter before action before Back Benchers are asked to vote on this issue, and I hope she will agree that that is a perfectly reasonable request. The Government cannot have it both ways: they cannot delay issuing a decision while at the same time asserting that what they are doing is absolutely right.

[Andrea Leadsom]

I do not know whether you have any particular constitutional view on this matter, Mr Speaker, but I am certainly unaware of the specifics. I will have to seek advice on it, and come back to my hon. Friend.

--- Later in debate ---

[Andrea Leadsom]

The hon. Lady is exactly right. Antisocial behaviour is a real blight on people’s lives and I am sure that we have all had constituency cases involving people who simply cannot cope with these levels of antisocial behaviour. A lot has been done to give the police more powers to tackle this, but I encourage her to seek an Adjournment debate or perhaps a Backbench business debate, so that all Members can share their views with Ministers.

[Sir Christopher Chope]

On a point of order, Mr Speaker. This arises directly from business questions, during which we made reference to the Delegated Legislation Committee that is due to sit on Monday afternoon to discuss the abolition of Christchurch Borough Council. Because this hybrid instrument affects Christchurch exclusively, I applied to serve on the Committee that will consider it—I made my application to the Selection Committee. I hoped that I would then be able to raise in Committee the criticism that has been made from the House of Lords Secondary Legislation Scrutiny Committee, as well as issues relating to the instrument being a retrospective measure, which, as I said, is the subject of potential legal proceedings. What can be done to reverse the Selection Committee’s decision that I should not be allowed to be a full member of the Delegated Legislation Committee? It is surely right that minority interests, particularly when one constituency is uniquely affected, should be able to be fully represented on a Committee. Obviously, I can attend the Committee, but I cannot participate fully in it. Is there any remedy available through which I can try to get myself on to that Committee?

Private Members’ Bills: Money Resolutions

Debate between Andrea Leadsom and Christopher Chope

Thursday 10th May 2018 Commons Chamber

[Andrea Leadsom]

As I have said, a number of private Members’ Bills are currently making their way through Parliament. We continue to look at providing money resolutions for those Bills that require them in the usual way, which is on a case-by-case basis. The financial initiative of the Crown is a basic constitutional principle, which means that it is for the Government of the day to initiate financial resolutions. This is a long-standing constitutional principle that is set out in “Erskine May”. The Government will keep the hon. Gentleman’s private Member’s Bill under review, but it is right that we allow the Boundary Commission to report its recommendations before carefully considering how to proceed.

[Sir Christopher Chope (Christchurch) (Con)]

I have to say I agree absolutely with the points made by the hon. Member for Manchester, Gorton (Afzal Khan). I think the Government’s behaviour is undemocratic and certainly is in breach of the undertakings they gave to the Procedure Committee, which were that, if a Bill got a Second Reading, as night follows day, it would then get a money resolution and the Government would not abuse their power as they are seeking to do now.

[Andrea Leadsom]

I point out to my hon. Friend that a number of private Members’ Bill are going through and a significant number have had a Second Reading. Those are awaiting Committee. They include the Parliamentary Constituencies (Amendment) Bill, the Health and Social Care (National Data Guardian) Bill, the Homes (Fitness for Human Habitation and Liability for Housing Standards) Bill, the Stalking Protection Bill, the Civil Partnerships, Marriages and Deaths (Registration Etc.) Bill, the Parking (Code of Practice) Bill, the Organ Donation (Deemed Consent) Bill, the Overseas Electors Bill, the Refugees (Family Reunion) (No. 2) Bill and others. It is very important that the Government use their good offices to bring forward money resolutions on a case-by-case basis in line with the long-held constitutional principle that it is for the Government to bring forward money resolutions.

Business of the House

Debate between Andrea Leadsom and Christopher Chope

Thursday 19th April 2018 Commons Chamber

[Andrea Leadsom]

I join the hon. Lady in wishing the Chairman of the Backbench Business Committee and Her Majesty very happy birthdays for Saturday. I take it that the hon. Gentleman is slightly younger than Her Majesty, but I am sure he would not venture to suggest by how much.

The hon. Lady has raised a number of important points. I am glad she is glad that we have debates on the higher education statutory instrument, the money resolution and Opposition motions scheduled for next week. We are, in fact, extraordinarily busy, and I would like to remind her of some of the achievements so far. We have introduced 27 Bills in this Session so far, including the seminal European Union (Withdrawal) Bill and other very important legislation that she mentioned, such as that on the general data protection regulation—I assure her that we are very aware of the impending deadline, and proceedings will be brought forward very soon.

We have had 11 Bills sent for Royal Assent already, including the Space Industry Bill—a fantastic opportunity to build the new skilled jobs of the future. We have six Brexit Bills before Parliament at the moment—the withdrawal Bill and Bills on nuclear safeguards, customs, trade, sanctions and road haulage. Of course, hundreds of statutory instruments have also been passed by each House. In addition, we have seven draft Bills published in this Session, and I will not detain the House any longer by naming them all.

However, I want to make the point to the hon. Lady that, in fact, we are achieving a lot, and I am delighted that that is the case. I am also delighted that the House is taking such an active part in not only the legislative programme, but some of the vital debates we have had just this week—that is incredibly important.

On the Windrush generation, which the hon. Lady raised, I can only again apologise. These individuals are British; they have absolutely every right to be here. What has happened is incredibly regrettable. My right hon. Friends the Prime Minister and the Home Secretary have apologised without reservation, and I do so again today. The Home Office is determined to put this right in short order, and that is what it is absolutely focused on doing.

The hon. Lady raised the issue of a fee, which I am sorry to say I am not aware of. If I may, I will investigate and come back to her. She asked when the EU withdrawal Bill will come back. As she knows, there are no programme motions, so their lordships will send it back to us in due course. Of course, we will consider all attempts to improve legislation, as we always do, and we will respond in due course to amendments that have been passed in the other place.

The hon. Lady also raised the issue of the restoration and renewal of the Palace. I am sorry if she thinks there was some sort of statement. In fact, the article in The House magazine was merely an attempt to keep Members’ interest in the subject. I am, of course, delighted to talk to her about progress at any time. As soon as there is substantive progress—for example, once we have recruited the internal and external members for the shadow sponsor body—there will be the opportunity to debate that in this place.

Finally, I pay tribute to the hon. Lady’s constituent, Janine Webber. It sounds as if that was harrowing testimony, and I am sure all of us in the House absolutely support the hon. Lady’s view that we should consider each other for who we are, not for where we come from or what we believe in.

[Sir Christopher Chope (Christchurch) (Con)]

May I ask my right hon. Friend about two statutory instruments that were laid just before Easter, which are designed to abolish Christchurch Borough Council against its will? Will she assure me that neither of those instruments will be brought forward for debate until there has been a report from the Joint Committee on Statutory Instruments, to which I have written pointing out that one of those statutory instruments seeks to change primary legislation and to do so retrospectively, with hybrid effect and in breach of Government undertakings to Parliament?

Business of the House

Debate between Andrea Leadsom and Christopher Chope

Thursday 20th July 2017 Commons Chamber

[Andrea Leadsom]

I do not for the life of me see why the hon. Gentleman thinks that earlier improvements for passengers with less disruption can possibly be a slap in the face. The Department for Transport is acknowledging that technology is enabling it to deliver less disruption and earlier improvements for passengers.

[Mr Christopher Chope (Christchurch) (Con)]

Growing public anger at the BBC is made worse by the fact that the public know that the BBC is funded by a highly regressive television tax. May we have an early debate not just on the accountability of the BBC but on its funding, with a view to getting rid of the television tax, which at the moment results in 10% of all cases in the magistrates courts and particularly impacts on women? Some 70% of the victims of that tax are women.

[Andrea Leadsom]

My hon. Friend is absolutely right that as a public service broadcaster funded by the licence fee the BBC has a responsibility to set an example for others and lead the way in promoting equality in the workplace. He might well wish to have a further debate on how the licence fee is working, and he will be aware that the recent debates on the BBC charter took up that very issue. If he wants to seek further discussion, he can do so in Westminster Hall or through an Adjournment debate.

Equitable Life

Debate between Andrea Leadsom and Christopher Chope

Thursday 26th February 2015 Commons Chamber

[The Economic Secretary to the Treasury (Andrea Leadsom)]

I add my congratulations to my hon. Friend the Member for Harrow East (Bob Blackman) and the hon. Members for Leeds North East (Fabian Hamilton) and for Eastbourne (Stephen Lloyd) on securing the debate. Their tireless work on this important issue is greatly appreciated by our constituents. Prior to my ministerial appointment, I was a member of the all-party group on Equitable Life policyholders and a number of my constituents have been badly affected, so I am deeply sympathetic to policyholders’ losses in this sorry tale. I shall explain what the Government have done to resolve the long-standing issue of Equitable Life and set the record straight on some of the history.

This situation has been a key priority for the Government. While Equitable remained solvent and continued to pay premiums to its members, its problems caused a great many of its policyholders to suffer significant emotional and financial distress. When we came to office, we made a commitment to implement the ombudsman’s recommendation that the Government should make fair and swift payments to Equitable Life policyholders in recognition of the part that the Government played in Equitable’s problems. Those payments were swift, in that within six months of taking office, we introduced the Bill that became the Equitable Life (Payments) Act 2010, and payments started to be made to policyholders in June 2011, which was within six months of Royal Assent. They were also fair because the scheme’s rules are based on the Government’s full acceptance of the parliamentary ombudsman’s findings of maladministration and, importantly, on the assumption that all policyholders would have decided to invest elsewhere had the maladministration regarding regulatory returns not occurred. Of course, that is a conservative assumption.

The ombudsman did not quantify the relative loss, which is the difference between the amount received by Equitable Life policyholders and what they would have received if they had invested in the same way in a similar company, but this Government assessed the total as £4.1 billion. That was significantly more than the final figure of £340 million that was arrived at under Sir John Chadwick’s methodology, which was based on the previous Government’s limited acceptance of the ombudsman’s findings. In the 2010 spending review, after taking account of the need to be fair to all taxpayers, we announced that up to £1.5 billion would be made available for payment to eligible policyholders.

[Mr Christopher Chope (Christchurch) (Con)]

Is my hon. Friend going to address the part of the motion that calls on the Government to pay full compensation in the next Parliament? The right hon. Member for East Ham (Stephen Timms) did not deal with that point, but our constituents want it to be addressed.

[Andrea Leadsom]

Yes, I am.

In line with representations received, out of that £1.5 billion, we covered the relative losses of the with-profits or trapped annuitants in full. Those annuitants were unable to move their funds elsewhere or to mitigate the impact of their losses by seeking employment. They were also generally the oldest policyholders. The remaining available funding, on the advice of the independent commission, was distributed pro rata to other policyholders, representing 22.4% of their relative loss. I know that that was deeply disappointing to many. These difficult decisions were taken in the light of the position of the public finances and in the interests of overall fairness to all taxpayers.

The motion notes that

“the Parliamentary Ombudsman recommended that policyholders should be put back in the position they would have been in had maladministration not occurred”.

However, the ombudsman went on to say that the impact on the public purse should also be taken into account when considering payment. She also stated that she was acutely conscious of the potential scale of what was recommended. She has subsequently written to the all-party group to say that the Government’s decisions on affordability and eligibility cannot be said to be incompatible with her report.

I congratulate all Members who contributed to the debate. It is clear that they have been assiduous in representing their constituents and have done an excellent job. My hon. Friend the Member for Southend West (Sir David Amess) talked about Ernst and Young as the auditors of Equitable, so he might be interested to note that in 2010, for its part in Equitable Life, it was fined £500,000, plus costs of £2.4 million, and received a reprimand by the accountants’ joint disciplinary scheme.

The hon. Member for Airdrie and Shotts (Pamela Nash) asked for a regional breakdown of amounts paid. No breakdown by region has yet been compiled, although we could produce a basic one if that would be particularly helpful. However, I assure her that regionality does not influence the scheme’s operation in any way.

My hon. Friend the Member for Harrow East, as well as the hon. Member for Coventry North West (Mr Robinson) and my hon. Friend the Member for Southend West, talked about the situation for the pre-1992 annuitants and the fact that they are elderly and financially vulnerable. The first regulatory return from Equitable Life that would have been different had there been no maladministration was that of 1991. This was available on request from Equitable Life from mid-1992 and could not, therefore, have been expected to influence investor decisions before late 1992. Therefore no relative loss was suffered by this group. However, as hon. Members have recognised, the Government agreed that this group of pre-1992 annuitants, although they are not affected by maladministration, have suffered significantly from a loss of income that they would have expected. For this reason the Government made an exceptional ex gratia payment of £5,000 to this group, with a further £5,000 to those on pension credit, in December 2013.

The hon. Member for Leeds North East and the right hon. Member for Knowsley (Mr Howarth) raised the question of compensation for the Icelandic bank savers in Icesave and why Equitable Life savers are being treated differently. The ex gratia payments to UK depositors in Icelandic banks were made as a result of a decision by the previous Government to guarantee all qualifying retail deposits specifically to protect the financial stability of the UK. The financial compensation scheme was simply the agent for these payments and we expect to recover all those sums from the Icelandic banks and are continuing to do so.

Specifically in the case of failed banks and why they receive compensation, the Financial Services Compensation Scheme is funded by a levy on financial services firms, so again those compensations do not come from the public purse.

In answer to the hon. Members for Moray (Angus Robertson) and for Airdrie and Shotts who asked when the scheme stops tracing people, all policyholders are either written to at their last known address or put through electronic tracing methods, such as looking them up against the electoral roll. Attempts are made through the Department for Work and Pensions to trace those owed more than £250. I should tell hon. Members that about 50% of the remaining policyholders are due less than £100.

My hon. Friend the Member for Poole (Mr Syms) asked whether we could re-allocate the remaining £500 million. That remaining £500 million is to make ongoing payments to annuitants for the duration of their annuity. Finally, the hon. Member for Stretford and Urmston (Kate Green) and my hon. Friends the Members for Bromley and Chislehurst (Robert Neill) and for Southend West asked what we had done to ensure that people were not put off the idea of saving for their retirement. As hon. Members know, the Government have undertaken a fundamental reform of the regulatory system, and put in place the Financial Services Act 2012 to establish a new system of specialised and focused financial services regulators. They abolished the FSA and set up new regulators within the Bank of England and the independent conduct of business regulator, the Financial Conduct Authority. These reforms are designed to ensure that the conduct of firms, and with it the interests of consumers and participants in our financial markets, are at the heart of the regulatory system and are given the priority that they deserve.

The recent news on the improvements that this economy has made since 2010 is to be welcomed and shows that this Government’s long-term economic plan is working, but we have a long way to go to restore the public finances, and the public purse remains very constrained. It is right that we have taken action on the Equitable issue, but we must balance this with the need to continue to address the difficult position of the public finances and the impact on fairness to all taxpayers. That is why this Government have no plans to change the funding available to the payment scheme. Our focus is rather to complete the small number of remaining payments. We have continued to make excellent progress with the scheme itself. Only this week I was pleased to report that over £1 billion has been paid to nearly 900,000 eligible policyholders.

In conclusion, I genuinely have deep sympathy with those who carefully saved for retirement and are not receiving the income they expected. Resolving the Equitable Life issue, and doing so swiftly and in a way that was fair to all taxpayers, has been a priority for the Government.

Insurance Bill [Lords]

Debate between Andrea Leadsom and Christopher Chope

Tuesday 3rd February 2015 Commons Chamber

[Cathy Jamieson (Kilmarnock and Loudoun) (Lab/Co-op)]

As the Minister has outlined, this is a non-controversial Bill overall, and we did indeed debate and discuss it last week. I have no issue with clause 1 and think that it is important to get on to the other areas of the Bill on which the Minister might wish to answer some questions.

Question put and agreed to.

Clause 1 accordingly ordered to stand part of the Bill.

Clause 2

Application and interpretation

Question proposed, That the clause stand part of the Bill.

[The Temporary Chair (Mr Christopher Chope)]

With this it will be convenient to discuss the following:

Clauses 3 to 8 stand part.

That schedule 1 be the First schedule to the Bill.

[Andrea Leadsom]

As I explained to the Second Reading Committee, part 2 concerns the duty on prospective policyholders to disclose information to the insurer, which allows the insurer to assess and price the risk accurately. However, the existing law can be difficult to understand and even more difficult to comply with fully. A failure to provide all material information allows the insurer to refuse all claims under the contract.

Under the Bill, policyholders still have a duty to disclose information, and they should make an active search for relevant information, but insurers might need to ask the policyholder questions if they require further clarification. If a policyholder fails to make a fair presentation of the risk, there is a new system of proportionate remedies for the insurer, under schedule 1 to the Bill, based on what the insurer would have done had the failure not occurred.

--- Later in debate ---

[The Temporary Chair (Mr Christopher Chope)]

With this it will be convenient to discuss clauses 10 and 11 stand part.

[Andrea Leadsom]

Part 3 deals with insurance warranties and similar terms. An insurance warranty is typically a promise by the policyholder to do something that mitigates the risk. Under the current law, any breach of warranty completely discharges the insurer from liability from the point of breach. That is so even if the breach is remedied before any loss is suffered and if the breached term had nothing to do with the loss. The insurer’s remedy therefore often seems unsuitable and too punitive. The Bill provides that an insurer will be liable for insured losses arising after a breach of warranty has been remedied. It also prevents an insurer from refusing payment on the basis of a breached term that could have had no bearing on the risk of the loss that actually occurred, such as where a warranty concerning a fire alarm is breached and the insured then suffers a flood in the insured property. The Bill also abolishes “basis of the contract” clauses. These clauses convert every statement made by a policyholder on a proposal form into a warranty.

[Cathy Jamieson]

Again, it has been helpful to hear the Minister’s comments. We have no difficulty with these clauses.

On clause 9, under the current law, an insurer may add a declaration to a non- consumer insurance proposal form or policy, stating that the insured warrants the accuracy of all the answers given or that such answers form the “basis of the contract”. That has the legal effect of converting representations into warranties. The insurer is discharged from liability for claims if the insured made any misrepresentation, even if it was immaterial and did not induce the insurer to enter into the contract. The Law Commission gave the example of a claim for flooding being refused, as the Minister suggested, because the insured had failed to install the right model of burglar alarm. The clause seeks to put an end to this practice by abolishing “basis of the contract” clauses in non-consumer insurance. Clause 10 replaces the existing remedy for breach of a warranty in an insurance contract.

Clause 11 was initially not included in the Bill. That gave rise to the introduction in the other place of a new clause that replicated a similar clause originally included by the Law Commission pertaining to situations in which an insured had breached a term of contract but could show that

“its breach of the term could not have increased the risk of the loss which actually occurred in the circumstances in which it occurred.”

In the Lords Committee, some expressed the view that this omission was an error. The Minister, Lord Newby, explained that the clause as originally drafted was

“too controversial to go through the special procedure for uncontroversial Law Commission Bills.”

He did, however, admit that it was

“difficult to argue against the policy and to say that insurers should be entitled to refuse liability for a loss that is of a completely different nature from that contemplated by the breached term.”

At the Government’s prompting, the Law Commission submitted a new draft, which became the current clause 11 and which was

“intended to minimise the uncertainty inherent in the first formulation”.

The clause acts to rectify the situation prior to the Bill when the actual nature of a breach of term was irrelevant. This has been a helpful process to ensure that that piece of tidying up was done. On that basis, we have no problem with these clauses.

Question put and agreed to.

Clause 9 accordingly ordered to stand part of the Bill.

Clauses 10 and 11 ordered to stand part of the Bill.

Clause 12

Remedies for fraudulent claims

Question proposed, That the clause stand part of the Bill.

[The Temporary Chair (Mr Christopher Chope)]

With this it will be convenient to discuss clause 13 stand part.

[Andrea Leadsom]

Fraud is a serious and expensive problem for insurers and innocent policyholders alike. According to industry statistics, policyholders currently pay an additional £50 on every insurance policy because of the cost of fraud to insurers. The Bill therefore strengthens and clarifies the civil law aspect of the Government’s drive to combat fraudulent claims by policyholders. The Bill sets out clear statutory remedies for the insurer where the policyholder has made a fraudulent claim. It affirms the common law position that the policyholder forfeits the fraudulent claim. The insurer has no liability to pay any element of it and can reclaim anything it paid before it knew about the fraud.

The Bill also clarifies an area of uncertainty, in that the insurer may choose to refuse any claim arising after the fraudulent act. However, previous valid claims should be paid in full. Finally, the Bill gives the insurer the equivalent remedies against a fraudulent member of a group insurance policy.

[Cathy Jamieson]

The Minister has again clearly outlined what the clauses do. As she said, clause 12 sets out the insurer’s remedies where the insured makes a fraudulent claim. It puts the common law rule of forfeiture on a statutory footing. Where the insured commits a fraud against the insurer, the insurer is not liable to pay the insurance claim to which the fraud relates. Where the insurer has already paid out insurance moneys on the claim and later discovers the fraud, the insurer may recover those moneys from the insured. As we have heard, that provides the insurer with a further remedy giving it an option to treat the contract as if it had been terminated at the time of the “fraudulent act”. That does not apply where a third party commits a fraud against the insurer or the insured, such as where a fraudulent claim is made against an insured party who seeks recovery from its insurer under a liability policy.

Clause 13 gives the insurer the remedies where there is fraud by one member of a group scheme. Again, we have no difficulty with these clauses standing part of the Bill.

Question put and agreed to.

Clause 12 accordingly ordered to stand part of the Bill.

Clause 13 ordered to stand part of the Bill.

Clause 14

Good Faith

Question proposed, That the clause stand part of the Bill.

[The Temporary Chair (Mr Christopher Chope)]

With this it will convenient to discuss clauses 15 to 18 stand part.

[Andrea Leadsom]

Part 5 deals with two separate matters: the principle of good faith and the ability of parties to contract out of the provisions of the Bill.

Clause 14 retains the statutory and common law principle that a contract of insurance is one predicated on good faith. However, the clause abolishes avoidance of the contract as the remedy for breach, recognising that avoidance is capable of operating very harshly against policyholders.

The provisions are a default regime for business insurance contracts. They are expected to be appropriate for the majority of insurance contracts, but there may be circumstances when parties prefer to set out their own bespoke arrangements. However, if an insurer wishes to rely on a term that will operate more harshly against the policyholder than the Bill otherwise provides, clauses 16 and 17 require it to act transparently when the contract is made, by ensuring that the meaning of the alternative provision is clear, and by drawing the attention of the policyholder to it. In so far as the Bill applies to consumers rather than businesses, it is a mandatory regime. Insurers are not entitled to contract out of its provisions to the detriment of consumers.

[Cathy Jamieson]

Under the Marine Insurance Act 1906, insurance contracts are ones of “utmost good faith”. Clause 14 removes avoidance of the contract as a remedy for breach of that duty of good faith, both from the 1906 Act and at common law. The intention of clause 14 is that good faith will remain an interpretative principle, with section 17 of the 1906 Act and the common law continuing to provide that insurance contracts are contracts of good faith.

Clauses 15 and 16 prohibit insurers from inserting in an insurance contract terms that would leave the insured—be they a consumer or a non-consumer—in a worse position than that required by the Bill.

Clause 16 defines transparency in respect of what an insurer must do to draw the insured’s attention to the disadvantageous terms of the contract. Clause 17 sets out the transparency requirements. For example, the insurer should take sufficient steps to draw disadvantageous terms to the insured’s attention within a reasonable time frame prior to their entering into the contract, but when an insured has knowledge of the term, they may not claim that the insurer has not brought it to their attention. Clause 18 deals with the insurer’s remedies where a member of a group insurance contract makes a fraudulent claim. Again, we do not think that these clauses are controversial and we are content for them to stand part of the Bill.

Question put and agreed to.

Clause 14 accordingly ordered to stand part of the Bill.

Clauses 15 to 18 ordered to stand part of the Bill.

Clause 19

Power to change meaning of “relevant person” for purposes of 2010 Act

Question proposed, That the clause stand part of the Bill.

[The Temporary Chair (Mr Christopher Chope)]

With this it will be convenient to consider clause 20 and schedule 2 stand part.

[Andrea Leadsom]

Part 6 covers a topic that is distinct from insurance contract law. It amends the Third Parties (Rights against Insurers) Act 2010 and will assist injured parties who have claims against parties that are now defunct where insurance was in place to cover such claims. As I said in the Second Reading Committee, part 6 will make it easier for mesothelioma sufferers to obtain compensation due from insolvent employers.

The Bill allows the Secretary of State, by regulations, to add or remove circumstances in which a person will fall within the provisions of the 2010 Act. The intention in the first instance is to use this power to add insolvency and other similar events to the 2010 Act. Draft regulations are being prepared by the Ministry of Justice. Once the first set of regulations are made, the 2010 Act can be commenced. The Government are committed to bringing the 2010 Act into force as soon as practicable.

--- Later in debate ---

[Andrea Leadsom]

My right hon. Friend will appreciate that this part of the Bill is designed to assist those who have insurance claims against parties that are now defunct, where insurance was originally in place to cover such claims. In theory, that could cover a motor insurance claim, but it is certainly not designed specifically to that end. Likewise, the cost of motor insurance will be determined by claims by the insurance companies themselves, so it is not envisaged that this will affect the cost of motor insurance.

I entirely agree with my right hon. Friend that the Law Commission has done an excellent job. Essentially, the Bill makes the insurance market more effective and fairer.

Question put and agreed to.

Clause 19 accordingly ordered to stand part of the Bill.

Clause 20 ordered to stand part of the Bill.

Clause 21

Provision consequential on Part 2

Question proposed, That the clause stand part of the Bill.

[The Temporary Chair]

With this it will be convenient to discuss clauses 22 and 23 stand part.

[Andrea Leadsom]

Part 7 deals with technical matters such as commencement, territorial extent and consequential amendments to existing legislation. The Bill repeals or amends various sections of the Marine Insurance Act 1906, which are superseded by provisions in parts 2 and 3. Clause 23 provides that the Bill extends to the whole of the United Kingdom, and that the provisions on insurance contract law will come into force 18 months after Royal Assent.

From a practical perspective, the new provisions will not apply to existing insurance contracts, but rather to new contracts and variations agreed after the Bill comes into effect. The regulation-making power on the Third Parties (Rights against Insurers) Act 2010 will come into force two months after Royal Assent.

Oral Answers to Questions

Debate between Andrea Leadsom and Christopher Chope

Monday 20th May 2013 Commons Chamber

[Andrea Leadsom (South Northamptonshire) (Con)]

8. What steps he plans to take to restrict access to benefits for new migrants from other EU member states.

[Mr Christopher Chope (Christchurch) (Con)]

14. What steps he is taking to reduce the eligibility to UK benefits of nationals of other EU member states.

[The Minister of State, Department for Work and Pensions (Mr Mark Hoban)]

We are taking steps to tighten further the rules relating to all migrants, not just new migrants. We are strengthening the habitual residence test; the Home Office is creating a statutory presumption that European economic area jobseekers and workers who are involuntarily unemployed will not have a right to reside here after six months unless they can demonstrate they are actively seeking work and have a genuine chance of finding a job; and we will prevent those with no entitlement to work in the UK from claiming contributory benefits.