Dormant Assets Bill [ Lords ] (First sitting)

Diana Johnson Excerpts

Committee stage
Tuesday 11th January 2022 Public Bill Committees

[Jeff Smith]

I thank the Minister for his comments. We are disappointed that the Government are proposing to remove the subsections relating to community wealth funds. The amendments made in the Lords that allow the Secretary of State to include community wealth funds as recipients of funding had cross-party support and have generally been welcomed by the sector.

The provisions specify that money from the dormant assets scheme can go toward a community wealth fund to

“support the provision of social infrastructure to further the wellbeing of communities suffering from high levels of deprivation”.

I am surprised that the Government want to remove a measure that empowers communities and surely goes to the heart of the alleged levelling-up agenda. There are Members on both sides of the Committee who represent areas that will benefit from this kind of initiative. The most deprived areas often have the weakest third-sector capacity and infrastructure, which adds to a cycle of disadvantage. Community wealth funds aim to halt that cycle. They are aligned with the aims of the levelling-up agenda and have the potential to transform communities and lives.

Community wealth funds give real power to local people to support local priorities and capacity building. The noble Lord Bassam, who moved the amendment, said that

“the proposal could act as a powerful tool in boosting deprived areas, putting small sums of money in communities’ hands so that they can invest in the facilities or services that would have the most local benefit—perhaps subsidising a community hall, running adult learning classes, supporting skills and training hubs and sports facilities, and improving digital connectivity.”—[Official Report, House of Lords, 16 November 2021; Vol. 816, c. 168.]

We see the amendment as part of the levelling-up agenda and a way of empowering communities, as well as an opportunity to trial new and innovative ways of funding.

I note that the amendment itself was a compromise. It simply allows the Secretary of State to include community wealth funds. In Committee in the Lords, there was a more substantial proposal to include local trusts. Because the Government said there was still work to do on the proposals, the amendment was passed, and it is essentially permissive. The decision on when to move forward is with the Secretary of State, which makes it all the more disappointing that the Government want to block what I think is quite a modest and sensible measure.

I thank the Minister for his comments on the consultation. I am grateful for his commitment that the community wealth fund will be an option to consider in that first consultation; that is good news. However, we believe that this is an important measure, and we would like to see the principle of it written into primary legislation. As my hon. Friend the Member for Pontypridd said, the principles of this Bill and the 2008 Act are generally too broad to guarantee that the community wealth fund is included; the principle must be framed in primary legislation. I therefore urge Members to reject the Government’s amendment, notwithstanding the welcome comments from the Minister on the consultation.

They always say that the first rule of politics is to learn to count. I appreciate that the Opposition might not defeat the Government on this one, so as a greater compromise, I also urge Members to support the cross-party amendment, which I think the Minister has effectively accepted as the right way forward. I leave it to my right hon. Friend the Member for Kingston upon Hull North to speak to her amendment.

[Dame Diana Johnson (Kingston upon Hull North) (Lab)]

It is a pleasure to serve under your chairmanship, Ms Ghani. I rise to oppose Government amendment 1 and commend amendment 3.

As we know, Government amendment 1 removes the provisions to create a community wealth fund as a means of tackling deprivation and building social infrastructure in left-behind communities. The Bill was amended in the other place to include those specific provisions. As we know, that amendment enjoyed significant cross-party support, including from Lord Hodgson from the Conservatives, Lord Bassam and Baroness Lister from Labour, Baronesses Kramer and Barker from the Liberal Democrats, Baroness Bennett from the Greens, and the Lord Bishop of Ely.

I oppose Government amendment 1 for two reasons. First, the Bill, as a piece of primary legislation, is an excellent opportunity to set out clearly not only the mechanism for the acquisition of dormant assets, but some of the priorities for their distribution. It is worth noting, as my hon. Friend the Member for Manchester, Withington just set out, that the clauses inserted by the other place are permissive, allowing the Minister and the Government if they so wish to enable the creation of funds to be established for community wealth funds.

That helps to set out the current thinking of this Parliament—that we recognise the importance of community wealth funds, and that we would like to see Government investment in that area. If the distribution of dormant assets is not identified with clear markers at this stage in proceedings, after so many years of discussion and debate, that would be a missed opportunity.

I do not believe that the Minister is correct in claiming that secondary legislation is the most appropriate mechanism for deciding on the distribution. We all understand that there is limited opportunity for debate on secondary legislation, and there is, of course, no opportunity to amend it. That means Parliament’s role will be limited to rubber-stamping the Government’s proposals.

With the expanded scheme expected to generate close to £1 billion of new funds for good causes, decisions about those causes are important and should be subject to proper debate and scrutiny in Parliament, rather than just introduced in secondary legislation. I know that Members across the House will want an opportunity to make the case for funding for their own constituencies and for many other good causes—of course they will; of course we all will.

I would argue that the creation of a community wealth fund is a matter of some importance to the Government themselves, with their levelling-up agenda for the most disadvantaged and left-behind areas. We hear so much about that from the Government, and it is really in their interest to have that on the face of the Bill.

There is, of course, a precedent here. It should be noted that the first causes to benefit in England—social investment, financial capability and projects for young people—were all written into the original 2008 Act. I therefore believe that it would be beneficial to keep provisions relating to the community wealth funds in this Bill to make clear what the money will be used for, and that it is the clear will of Parliament. I know the Government do not want dormant assets to be used to supplement their day-to-day spending, but without direction and clarity in the Bill, that could be one unintended side effect. We need a very clear direction of travel, which clause 29 currently provides.

The second reason I oppose the Government’s amendment to remove the provisions for a community wealth fund is that any consultation process on how assets should be distributed could take some time. In his opening remarks, the Minister referred to the summer and talked about a 12-week consultation period, so it seems likely that the rest of 2022 will be gone before we get to the point of any secondary legislation being brought to Parliament.

If the Government really are serious about their levelling-up agenda, keeping the provision for community wealth funds in the Bill is an opportunity that helps the Government. The community wealth fund commands broad support. Polling research shows that the proposal would have support among senior leaders in the financial services industry, whose endorsement the Government have said is key. Were the fund to remain written into the Bill, the Community Wealth Fund Alliance could start the process of securing match funding and planning to get money into the most left-behind communities as soon as possible after Royal Assent.

I ask the Minister to reconsider on the basis of those arguments. I genuinely believe that this measure would assist the Government with one of their flagship policies.

I move on to amendment 3, in the name of my hon. Friend the Member for Sedgefield (Paul Howell), my co-chair of the all-party parliamentary group for “left behind” neighbourhoods. If amendment 1 is passed, amendment 3 offers an alternative approach, as it would require the Government to

“specifically consult on the merits of establishing a community wealth fund”.

As drafted, the Bill was silent on the purposes that the cash from this next wave of dormant assets would be spent on. As we know, the Government estimate it could be as much as £900 million. As I just set out, that lack of clarity contrasts very clearly with the original legislation, the Dormant Bank and Building Society Accounts Act 2008. The causes that would be supported—social investment, financial inclusion and projects for young people—were very clear in that legislation, so it makes sense to me, given the amount of money at stake and the enormous contribution that the dormant assets scheme will make to good causes, that the matter of where the money is spent should be debated in and ultimately determined by Parliament.

In response to efforts to assist the Government by putting in the Bill powers to establish pilot community wealth funds, the Minister is arguing that the Bill should not cover the specifics and set out the purposes that the funding should be directed to, and that such important detail should be left to the secondary legislation, albeit informed by public consultation. I note what the Minister has committed to do. He said that the community wealth fund would be a part of the first round of consultation, but I would like to push him a little further. Will he meet me and the others who are advocating the establishment of a community wealth fund halfway? Amendment 3 is probing at this stage. I am not going to force the issue to a vote today, but I want to test the Minister further on whether he might be minded to include the community wealth fund as a named and clearly identified object category in that first consultation by putting it in the Bill, if not at this stage, perhaps on Report.

The noble Lord Parkinson, the Under-Secretary of State for the Department for Digital, Culture, Media And Sport in the other place, said

“the Government will consider including community wealth funds in the first consultation launched under Clause 29.”—[Official Report, House of Lords, 16 November 2021; Vol. 816, c. 192.]

The Minister has reiterated that commitment today, but I would like a bit more reassurance from him. I hope we might be able to persuade him to go one small step further and to confirm that it would be written into the Bill, which would be really helpful. That would give those of us in the House who have advocated for this proposal a great deal of comfort, and I think it would be a really popular measure for the Government. It is clearly established as a principle that dormant assets should be used for good causes—in other words, for voluntary and community action, independent of the state—and the voluntary and community sector has already signalled its support for the community wealth fund.

Dormant Assets Bill [Lords]

Diana Johnson Excerpts

Report stage
Monday 31st January 2022 Commons Chamber

[Claire Coutinho (East Surrey) (Con)]

I support the Government’s proposal for a public consultation on distributions to a new community wealth fund. We talk often and rightly in this House about levelling up, particularly on the Government side of the House. It is right that this a priority for the Government, but too often we talk as if the work of levelling up were a job for Government alone. I firmly believe that the best decisions for communities are rarely made for them rather than by them. That is why we should treat communities across the country as the legitimate decision makers that they are. We all know that strong community leaders can transform a local community We will all have seen that on our patches. I could name many from East Surrey, including Janine Battersby in Woldingham, and Kay Hammond and the Calvers in Smallfield. With their dedication, charisma and get-up-and-go, they forge friendships, support those who need extra help, and put the local needs of their communities in front of those who might be able to meet them.

Let me give the House a brief example of this in action. I recently visited the residents group Ambition Lawrence Weston. On the edge of Bristol, Lawrence Weston had for too long had been used as a dumping ground for social housing tenants with complex needs. They were trapped in a negative cycle. Low housing costs made it attractive for the council to use it to temporarily house people, often with complex needs. That created disruption and fracturing within the community, which in turn drove low housing costs—and so the cycle went on.

However, with the support of the Local Trust’s Big Local community fund programme, the residents decided that they had had enough of things being done to them instead of for them. With some initial capital support from the community fund, they have transformed the area by building a new community centre, bringing in a new supermarket, introducing a local lettings policy, and bidding directly for Government funds themselves. They have a solar farm and even a wind turbine to tackle fuel poverty. I am in awe of that team. I have seen similar developments on my own patch: we have a community fund, Your Fund Surrey, and I am working with some brilliant people in Whiteley, Dino, Sarah and Marcus, who are pushing to set up their own community centre and are doing it brilliantly.

It was a relatively small amount of funding that made these developments possible, but that funding unleashed the really important thing: the leadership, ambition and energy of a group of remarkable, community-minded individuals, which has made such a difference. Without these funds, that would have been wasted. I believe that the community wealth fund can unlock that level of ambition and energy from individuals up and down the country, and I am pleased to support amendment 2.

[Dame Diana Johnson (Kingston upon Hull North) (Lab)]

I welcome amendment 2 to clause 29. Those who have followed the passage of this Bill from its introduction in the other place to its Report stage today will know that along with other members of the all-party parliamentary group for “left behind” neighbourhoods, including my excellent co-chair, the hon. Member for Sedgefield (Paul Howell), I have long been advocating the establishment of a community wealth fund as part of the extended dormant assets scheme. The Government’s amendment proposes that a national consultation on the distribution of dormant assets should include consultation on the distribution of these moneys to a community wealth fund through including them on the existing list of beneficiaries set out in the original legislation on dormant assets. Such a fund would be aimed at developing social infrastructure in the most left-behind neighbourhoods of the country—neighbourhoods such as Bransholme and Orchard Park in my constituency of Hull North. They are communities that not only suffer from extreme levels of disadvantage and deprivation, but experience significant deficits in their local community fabric. As research from the all-party group has found, residents of these communities experience well-below average outcomes across a whole range of indicators. For example, our recent report on health inequalities found that people living in left-behind neighbourhoods have among the worst health outcomes in England, with growing disparities between them and the rest of the country, including the most shocking statistic that a person from one of those neighbourhoods was 46% more likely to die during the covid pandemic.