GKN: Proposed Takeover by Melrose

Jim Cunningham Excerpts

Thursday 15th March 2018 Westminster Hall

[Mr Bailey]

The hon. Gentleman has put his finger on an issue that I will develop at some length during my speech. He is absolutely correct.

Perhaps I should state that, from a philosophical or ideological point of view, I am not anti-private sector. I am not anti-City. I recognise that globalisation is a potential force for good, even though it does throw up some considerable challenges and needs to be managed. I feel, however, that the role of Government must be to ensure that where vital national interests are at stake, the private sector is regulated in such a way that those interests prevail over what are often the short-term or illusory interests of the shareholders involved or the myriad City professionals and advisers that tend to make a lot of money from takeover bids. Some of the issues that arise from this proposed takeover bid are specific to GKN and Melrose, but others throw up broader, national issues.

GKN is a company of enormous strategic importance to the British economy. In 2015, it made sales of more than £16 billion worldwide and contributed £1.36 billion to our economy. It is one of the major—perhaps the major—tier 1 providers within the automotive and aerospace industries.

[Mr Jim Cunningham (Coventry South) (Lab)]

My hon. Friend has brought a timely debate. I have worked in defence industries. The Secretary of State has got to look at this in the context of the national interest, because the real danger is that the Americans will hive it off piece by piece. The hon. Member for Isle of Wight (Mr Seely) is right when he says that Melrose only keeps businesses for about five years, makes a profit for shareholders and is gone. This is probably one of the last bastions of Britain’s independent defence industries. More importantly, there are 6,000 jobs at stake. No doubt Melrose has its eye on the pension scheme as well—most of them do.

[Mr Bailey]

My hon. Friend anticipates some of the points in my speech. I agree with him completely.

GKN holds the position as one of the world’s greatest tier 1 providers in part because of the number of portfolios it holds worldwide with other joint venture companies, as well as with British companies, but also because of its research, development and technological advances, particularly in the automotive and aerospace industries. The UK aerospace sector is the largest in Europe, second globally to the USA. It supports more than 210,000 well-paid jobs in this country and delivers £29 billion in exports, generating £32 billion in turnover each year. GKN, as the only large tier 1 supplier, has a strategic role in the growth of the sector and, as I said earlier, it makes a total contribution to the UK economy of more than £1.3 billion.

GKN’s identity as a sector leader is largely based on the large amount it invests into research, development and technological advances. The distinctive focus on research has for decades been the cornerstone of the company. By its very nature, research and development involves long-term investment projects. The benefits of such programmes are often enjoyed only decades or even longer after the investment has started.

Typically, the motor industry has a product cycle of seven to 10 years, but at the moment major car manufacturers are looking for long-term partners to invest in future generations of electric vehicles. Because of its long-standing association with those companies, GKN is currently well placed to be a partner in such ventures. The aerospace sector has a product cycle of 20 to 40 years, again highlighting the importance of a company investing long term with the companies it serves. Since 2000 GKN has invested more than £561 million. That has created long-term, well-paid, highly skilled jobs that are of particular benefit to our regional as well as our national economies.

[Mr Bailey]

Absolutely. The hon. Lady puts her finger on a very important point. Productivity in the motor and aerospace industries is way ahead in manufacturing overall, and in other types of business as well. Anything that damages such industries will damage the level of productivity in our economy, which we all know is a matter of considerable concern.

GKN not only invests in research and development in its own companies, but partners universities up and down the country—Leeds, Manchester, Warwick, Nottingham and Sheffield, for instance—again helping to underpin regional economies, driving research excellence and giving students the level of skills that they need and an involvement in manufacturing that is absolutely crucial for developing our future skills base. As the hon. Member for Isle of Wight (Mr Seely) mentioned, the Melrose business model appears to be fundamentally incompatible with that approach.

I was chided by the Melrose chief executive for calling Melrose a hedge fund company. It says it is not; it says it is a turnaround company. In the Business, Innovation and Skills Committee it was called an asset-stripping company. Whatever we call it, it has a short-term strategy reminiscent of the way in which hedge funds work. It aims to buy and sell companies within a window of between three and five years. Despite protestations that it does keep companies for the longer term, one example that must be considered is that of Brush of Loughborough, a UK company that makes gas turbines. It was taken over by Melrose 10 years ago and is failing. Melrose has been unable to sell it on in its desired turnaround window because of the huge structural change in the sector owing to the move away from fossil fuels. Melrose has failed to invest in development to mitigate the changes and save employment within the company. It has already halved its workforce and has recently announced another 270 job cuts.

Although Melrose has invested £230 million in research and development in various companies over the past five years, the significant thing is that that is less than it paid its top 20 executives in the past year alone. That does not seem to be indicative of a company that is committed and wedded to long-term investment in research and development.

Many Members will have seen the announcement from Tom Williams of Airbus. The Financial Times has today published an interview with Tom Williams, the chief executive of Airbus, which is one of GKN’s biggest customers. He said it would be “practically impossible” to give new work to the engineering group if Melrose succeeded in its hostile bid. He cited the lack of “strategic vision” and the lack of long-term investment owing to the short-term ownership model. We could not detect a more telling intervention and substantiation of the point being made. We must remember that Airbus is only one customer of GKN, but Airbus’s public statement sends a signal to many other strategic customers of GKN.

Another cause for concern is the relative size of the companies. Last year alone GKN had revenue in excess of £10 billion, compared with just over £1 billion at Melrose, which proposes to finance its bid by borrowing £3.5 billion.

In addition, GKN employs 60,000 people across 30 countries, a level of personnel management that Melrose has no comparable experience of. As part of its takeover bid, Melrose has revealed plans to sack the entire board of GKN. Melrose as a company would double in size, but with no commitments to further capacity and an absence of the management expertise that has historically been part of GKN. Furthermore, Melrose has never taken over a company that specialises in aerospace manufacturing, which is perhaps one of the most concerning issues of all.

GKN’s prominence in the aerospace sector means it has a unique stake in the maintenance of our national security. As a leading world tier 1 supplier, it operates on a lot of UK defence platforms. As its order book with the Ministry of Defence is relatively small, Melrose has claimed that that issue is not significant. It ignores the fact that many of GKN’s customers are foreign companies that provide defence equipment that is subsequently procured by this country, so there is a much greater strategic involvement than the figures quoted by Melrose suggest.

GKN’s military aerospace involvement includes Lockheed Martin, Lightning, Raptor, Boeing, Eagle, Hornet, Harrier II, Eurofighter, Typhoon, Panavia, Tornado, Saab, Gripen and the new B-21 engine—a huge range of engines and vital components in a vast range of our defence components and needs for the future. Significantly, our own Defence Secretary felt the need to raise this issue with the Department as he no doubt responds to concerns that lie within the industry. I hope the Minister will refer to that when he sums up.

The US Government are highly likely to review any takeover via their Committee on Foreign Investment. The UK has a clear interest and should do the same. The public interest test applies under the national security element of section 58 of the Enterprise Act 2002, and the UK Government have the power to consider whether the takeover is in the public interest.

[Mr Cunningham]

Earlier, I mentioned the fact that GKN is one of the few companies that now gives Britain its independence in defence terms. It has been known for years—and if we think about it, it is a matter of the national interest—that, for example, Pratt & Whitney has always been after Rolls-Royce. That gives an indication of what is likely to happen at GKN if Melrose takes it over and asset-strips it. American companies will come in, and we will no longer have an independent role to play in manufacturing our own defence equipment.

[Mr Bailey]

My hon. Friend anticipates, with great foresight, some of the potential developments if the takeover were allowed to happen.

I believe that there are broader issues, however. The GKN takeover is a case that goes well beyond defence. It is relevant to our productivity, as the hon. Member for Redditch (Rachel Maclean) said, to our economy and research capabilities, and to the jobs and pensions of about 6,000 people in the UK. I am not here to argue that GKN is a perfect company and perfectly managed—that issue is widely acknowledged; but in view of the contribution that it makes to our industry as a whole, the highly paid and highly skilled jobs that it provides, its innovative research-led developments in key sectors of the economy and its commitment to maintaining a strong manufacturing industry in the UK, its future development needs to be carefully thought through, balancing the interests of shareholders with the vast number of other stakeholders involved.

Neither the takeover, nor a hastily contrived reorganisation in response to it, is the best way to deal with the problems. A solution centred on preserving shareholder value at the expense of all else would be disastrous for regions, such as the west midlands, that depend on manufacturing, and for productivity and the economy. The far-reaching implications of the proposed bid should prompt the Secretary of State to look at widening his powers of intervention on takeovers to include broader considerations of public interest. I appreciate that it was a Labour Government who withdrew that consideration, in the Enterprise Act 2002, but since then the global nature of the world economy has changed rapidly. Welcome adjustments were made to the takeover code relating to post-offer undertakings following the Kraft-Cadbury takeover. However, it is time to re-examine the situation, and to seek a more robust set of criteria that acknowledge the integrated investment and research-led nature of the 21st-century global economy, to ensure that the globalisation that benefits many areas does not decimate others. That could be done by broadening the criteria for defining the public interest, from the existing four, by increasing the percentage of shareholders who have to vote in favour of a takeover, or in other ways. It is time that the question was re-examined, to get a more robust set of criteria, which would preserve vital national interests.

In answer to a question on 7 February, the Prime Minister said at column 1494 that she would act in the “national interest”; and in August 2016 she launched her Cabinet Committee focusing on delivering one of her Government’s top three priorities—an economy that works for everyone, with a strong industrial strategy at its heart. The case of the GKN takeover provides the Prime Minister with a chance to prove the strength of her commitment to her self-defined mission to make Britain a country that works for all.

Oral Answers to Questions

Jim Cunningham Excerpts

Tuesday 13th March 2018 Commons Chamber

[Greg Clark]

I certainly will. The Jaguar and the London taxi are iconic images, and to see them leading the way into the future is a matter of great delight. I congratulate both companies on choosing to manufacture those vehicles in the UK.

[Mr Jim Cunningham (Coventry South) (Lab)]

What is the Secretary of State doing to help development in the transition from diesel to electric vehicles? In particular, how is he helping with infrastructure?

[Greg Clark]

We are working very closely with the industry to ensure that as it develops the new technologies of the future, it is able to plan a smooth transition to a world in which all vehicles will be compatible with our climate objectives.

Domestic Gas and Electricity (Tariff Cap) Bill

Jim Cunningham Excerpts

2nd reading: House of Commons
Tuesday 6th March 2018 Commons Chamber

[Rebecca Long Bailey]

The hon. Gentleman makes an interesting point. We would expect all stakeholders to be engaged in the process, because the Bill must suit the entire energy market and deal effectively with competition. As I set out earlier, the Bill, as drafted, does not provide sufficient clarity on what is meant by “effective competition”.

[Mr Jim Cunningham (Coventry South) (Lab)]

In answer to the question asked by the hon. Member for Fylde (Mark Menzies), the regulator is supposed to represent consumers, but it is not strong enough to do that. The sooner we have a proper inquiry into the energy market the better. I have been saying that for the past seven years.

[Rebecca Long Bailey]

My hon. Friend makes a fantastic point about the need for a fundamental root-and-branch look into how our energy market functions and what we will expect to see from it if it is to suit our needs.

The Opposition are pleased that the Government have caught up and finally brought forward legislation to ensure that a price cap is implemented, but the Bill is frankly too little, too late, for millions of people who will not feel benefit this winter and nor, it would seem, for half of next winter. This sticking plaster is only guaranteed to be in place until the end of 2020, so the Government need urgently to bring forward radical proposals for long-term reform of the energy market. We have already set out a clear plan, and it is time that this Government started to catch up.

Funding Higher Education

Jim Cunningham Excerpts

Wednesday 28th February 2018 Westminster Hall

[Paul Blomfield]

I thank my hon. Friend for that intervention. Clearly, we are at one on that issue.

[Mr Jim Cunningham (Coventry South) (Lab)]

I apologise for being late for the debate, Mr Hosie. My hon. Friends make an interesting and important point. In Coventry, universities make a major contribution to the local economy, for example. Very often, we find that students are also helpful to community organisations. Sometimes, someone who is doing a law course can give unofficial advice, which is helpful, given the situation we now face with cutbacks. The other point is that further education has taken a bit of a hit as well. In Coventry, there have been 27% cuts.

[Paul Blomfield]

I have visited the university that my hon. Friend represents. It does particularly innovative and good work in supporting small businesses and is a leader in the sector. He makes an important point. At a time when one of the issues we face as a country is the imbalance in the economy between London and the south-east and the rest of the country, universities offer a unique asset in ensuring that economic growth is distributed across the country. They are the one asset that we have in every part of the UK, in its regions and nations. The role that they play in driving economic growth is hugely important. My hon. Friend makes that point very well.

I have three additional points. First, will the Minister answer the question—which the Education Secretary was unable to in the statement the other day—relating to widening participation and fair access funds? There is a concern that one of the ways in which the sector will be squeezed in order to hit ambitions on fees is by reducing the amount of money allocated to widening participation and fair access. Investment in that area was one of the few good things that came out of the 2012 reforms, so I would be grateful if he could give a reassurance on that.

--- Later in debate ---

[Paul Blomfield]

I thank the Minister for that intervention. As we said earlier, fairness of opportunity and the choices available depending on where a person lives are issues in the current system. The widening participation and fair access programmes are hugely important, and I am grateful for the Minister’s assurance that not one penny will be taken from those areas of funding.

I endorse the point that the hon. Member for South West Devon made about nursing, midwifery and allied health courses. When we had a debate on the Government’s proposals in this Chamber previously, some of us challenged the Government and said that taking away bursaries and introducing fees for those courses would lead to a drop in applications. The then Minister, who is no longer a Member of the House, assured us that what the Government were trying to do—you couldn’t make it up, Mr Hosie—was share the benefits of the funding system for other undergraduates with nursing and midwifery courses. Share the benefits! Some of us questioned whether a £50,000 debt was a benefit, and warned of the sort of drop in applications that we are now seeing. I hope the Minister will tell us that the decision about the funding arrangements for nursing, midwifery and allied health courses will be reconsidered as part of the funding review, and that the Government will put on hold the current proposals to extend those arrangements to other health courses that are not currently subject to fees and loans. The Minister is obviously aware of those areas. The Opposition have tabled prayers seeking a halt to those proposals.

As the hon. Member for Glasgow North West (Carol Monaghan) said, a number of things are coming together and will cause an enormous crisis in the NHS, but that is not the only issue. Nursing, midwifery and allied health courses are one of the few areas for second-chance education. They are dominated significantly by mature students, who see them as a route into a professional career and personal advancement, which is not available through the 2012 funding system. Since the 2012 funding system was introduced, there has been a significant drop in the number of mature students.

[Mr Jim Cunningham]

We have raised the issue of education maintenance grants many times in this place. Women often have an ambition to go into nursing when their children grow up, and they are affected because they cannot get education maintenance grants. This is a very important issue, and once again women are carrying the can.

[Paul Blomfield]

Again, my hon. Friend is absolutely right. From the point of view of the needs of the NHS and the opportunities for mature students, and just for the sake of justice, we need to look again at nursing, midwifery and allied health courses.

I will make my third point very briefly, because this is a much bigger topic. I raise this issue as co-chair of the all-party group on international students. Universities’ financial stability is partly based on this country’s enormous success in attracting international students to come and study here. Those numbers are flatlining as a result of measures taken by the Home Office and the inclusion of international students in the net migration numbers, which inevitably leads to policy decisions that discourage international students. The Minister will say that the numbers are holding roughly up, but holding roughly up is not good enough in a growing market, because it means a relative decline.

There is a huge risk as we leave the European Union, because some 125,000 of our 450,000 international students come from the EU, and most universities are modelling on the basis that we will lose about 80% of them. One third of non-EU students said before the referendum that if we chose to leave the European Union, they would find the UK a less attractive place to come to. The Government need to put in place measures within the framework of the strategy to actively encourage more international students. They can start by removing them from the net migration targets.

Fireworks

Jim Cunningham Excerpts

Monday 29th January 2018 Westminster Hall

[Bill Grant (Ayr, Carrick and Cumnock) (Con)]

Thank you, Mr Walker; it is a pleasure to serve under your stewardship. I apologise to my colleague the hon. Member for Poplar and Limehouse (Jim Fitzpatrick), whom I know well, and I thank the hon. Member for Clwyd South (Susan Elan Jones) for introducing the debate.

I have a background of some 31 years in the Strathclyde fire and rescue service. Way back in 1974—44 years ago —bonfire night was inevitably busier than any other night of the year, and that remains the case. It is indeed important to “Remember, remember, the fifth of November”, because it stretches the resources of all emergency services, not just the fire and rescue service. Colleagues in the ambulance service treat people injured by flying embers or by fireworks, and regrettably, police officers often have to accompany other emergency services workers to ensure their safety from attacks.

We must bear in mind that the greatest costs are the human costs—the costs of burns that may scar or disfigure someone for life, of loss of sight and, as we heard, of the triggering of PTSD, which often happens to members of the armed forces who have served this country well. Albeit that fireworks often provide a colourful spectacle at small private displays and large public events, many humans and animals find them very distressing, particularly given their noise, even if they do not inflict physical injury.

As a member of a pet-owning and pet-loving family, I am acutely aware of the stress that fireworks cause many domestic pets. There are products on the market—CDs and garments with pressure pads, for example—that claim to afford pets relief and desensitise them, but it is impossible to assist livestock in fields. The light and noise from fireworks may spook sheep and cause them to crowd in the corners of fields and risk suffocation, and cattle may bolt from their field and become distressed, or worse. We heard horrific figures about the deaths of horses resulting from the irresponsible use of fireworks, and we must never forget assistance dogs, such as guide dogs, hearing dogs and companion dogs, which may be unnecessarily distracted from their important duties.

Of course, many domestic pets are simply unnecessarily petrified by the noise of fireworks, which is often not simply a bang but a screech or a whine. Their hearing is distinctly different from ours. Given the more frequent use of fireworks, we inflict that experience on man’s best friend more than just one day a year. Those pets, who are much loved, including by many in the Chamber, are simply inconsolable.

I appreciate that quieter fireworks are available on the market, but, according to a recent report commissioned by the City of Edinburgh Council, they lack the propellants that give the height and burst of colour for those viewing at a distance. In other words, they are second-rate fireworks and not particularly acceptable.

There is a raft of UK-wide and Scottish-specific categorisations and legislative controls for fireworks, including on their production, storage, sale and use, ranging from the Explosives Act 1875—slightly before my time—to the Fireworks (Scotland) Regulations 2004 and, more recently, the Pyrotechnic Articles (Safety) Regulations 2010. However, the question, which has been asked before, is whether they are fully understood by those enforcing them, such as trading standards and the police, and by the public, who indiscriminately activate them.

[Mr Jim Cunningham (Coventry South) (Lab)]

I certainly would not comment on what happens in Scotland, but in England one of the big problems, as mentioned earlier, is policing. In the west midlands we have a particular shortage of police and a shortage of trading standards officers, and that—I am trying not to be too political—is because of local government cuts. Over the past 26 years I have listened to debates about fireworks like nobody’s business, but nothing positive happens. This time round we should have a commission to take a good look at it.

[Bill Grant]

The hon. Gentleman is partly correct. We should have a good look at this issue and get the statistics. I do not know whether there is an association with cuts, because when we were in the land of plenty I do not think the laws were well understood or policed. I do not link cuts to the tragedies that occur.

In my view, such categorisations and controls alone are not sufficient. It is important to minimise potential physical injuries and psychological distress further to both humans and animals.

I will take a wee look at statistics. The website of the Royal Society for the Prevention of Accidents tells us that in 2014-15—this an unbelievable figure—4,506 people visited accident and emergency departments in England having suffered a firework injury. On that one night, 114 were admitted to hospital, of whom 44 were under 18 years of age. That includes 11 admissions involving children under five. For the benefit of fun and gratification from fireworks, should we be doing that to our children? Should we have that risk, or should we mitigate it? I think we should mitigate it.

In Scotland in 2017, 5 November resulted in 330 bonfire incidents, and on 11 occasions crews faced missiles and fireworks not for entertainment but fired towards them. They needed police assistance each time. Is that ignition of fireworks necessary on a bonfire night for the gratification of the public? In addition, 800 calls were received during that night.

I fully acknowledge that the Government have highlighted themselves and through other agencies the dangers of fireworks and taken steps to promote safety advice and guidance. However, even one life-changing incident is one too many. For that reason, and because of the distress, injury and deaths caused to animals we heard about earlier, I advocate a ban on the sale of fireworks to individual members of the public. I believe firmly that the sale of fireworks should be restricted to professionals with health and safety training and qualifications who have permission to undertake an organised display for specific commemorative events at pre-arranged dates and times. Fireworks should not be used just at someone’s whim, whenever they want to frighten the life out of a neighbour’s cats and dogs, or when someone in a remote cottage wants to frighten the life out of nearby horses or farm animals.

Some may be fearful about potential job losses in the United Kingdom from such a ban. However, as I understand it few people are employed here in the manufacture of fireworks—no more than double figures —as most fireworks are imported. As an inadvertent consequence of banning the sale of fireworks, we might reduce our trade deficit with some of the countries from whom we import them.

I am not an advocate of state intervention. However, look at the success of seatbelt and crash helmet legislation and the long-term success of the smoking ban. Let us not ban organised events but end the retail sale of fireworks, and make that a success, too. As colleagues have said, we need to gather evidence from all corners of the United Kingdom, and I think the evidence will show that such a ban would be good for our children and future generations. On that night, I am sure they do not know what they are celebrating.

Nuclear Safeguards Bill

Jim Cunningham Excerpts

3rd reading: House of Commons & Report stage: House of Commons
Tuesday 23rd January 2018 Commons Chamber

[Ben Bradley]

I am sure the Minister will agree that we need to support the industry and that we need to do what the industry asks. My point is nothing other than that. My point is that we cannot make that decision in this Bill. It is for the negotiation to decide at a later date.

New clause 1 neglects to recognise that an implementation period is subject to negotiation and must be agreed directly with the EU—we cannot do it unilaterally. The idea of implementation before withdrawal also does not fit with broader plans and discussions that have been mooted for transition out of the EU after withdrawal in March 2019. It simply does not fit. The Government clearly cannot include in a Bill the outcome of a discussion that has not happened.

We need to decide the basic framework now and act accordingly.

[Mr Jim Cunningham (Coventry South) (Lab)]

We understand that there are certain things the Government cannot say about the negotiations, but ultimately we want to know the outcome of those negotiations before withdrawal so that Parliament can have a view on it, rather than the Government operating a Henry VIII clause.

[Ben Bradley]

I do not know the hon. Gentleman’s background, but I guess, by the sounds of it, it probably is not business.

We cannot fix the plan for withdrawal and implementation in stone now. The Labour party wants to build into the Bill a clause saying that the Bill is contingency only. Our relationship with Euratom is subject to negotiation. No one has written anything off. We want a positive relationship, but we might have to develop and rely on our own framework, and the work to put it in place needs to happen now. An amendment to say that the Bill is merely a contingency would achieve the opposite of its intention by reducing impetus and leading to delays in the process of getting our safeguards in place, which is only bad for the industry and for all the things the hon. Member for Southampton, Test (Dr Whitehead) tried to raise.

That is why I oppose new clause 1, and I hope to speak later about my support for the Bill more broadly.

Budget Resolutions

Jim Cunningham Excerpts

1st reading: House of Commons
Tuesday 28th November 2017 Commons Chamber

[Mr Jim Cunningham (Coventry South) (Lab)]

This is a Budget from a Government who have run out of ideas and are lacking in imagination. They heralded it as a Budget that will help everyone, but nothing in this Budget will help ordinary working people. In seven years under this Government, we have seen wages fall, and they are now lower than they were in 2010. Personal debt levels are rising, and with interest rates starting to rise we are heading for a massive problem. There has not been nearly enough progress in closing the gender, race and disability pay gaps—that is simply unacceptable. Britain is meant to be the sixth largest economy, yet public and business investment is among some of the lowest in advanced countries. We are also seeing low productivity.

On Brexit, there is uncertainty in all sections of society because of the shambolic negotiations that we have seen so far. The OBR’s downgrading of economic growth and productivity make for bleak reading, and we seem to have a Government who have refused to learn from their mistakes. They cannot even hit targets they set for themselves; they promised to eradicate the deficit by 2015, 2016 and 2017, and now they have pushed it back to 2020 and probably beyond.

Coventry and the west midlands stand to lose out hundreds of millions of pounds in EU structural funding after Brexit. This Government’s policies and, in particular, this Budget do not do enough to stimulate investment and growth and to help replace the funding that will be lost. The Government are not building a strong economy and they certainly are not leading the way for Britain to remain a major world player.

The Budget does nothing to help ordinary people who are struggling up and down the country. The national living wage has been revised down, so it will not reach £9 by 2020, as previously promised, and the Government are persisting with the horrendous roll-out of universal credit, instead of pausing the roll-out to allow the system to be improved. The Chancellor’s offer of help will not help people enough, as it is only a fraction of the £3 billion a year cuts they have made to this scheme. Only £1 of every £10 cut has been put back, and that just is not enough to help vulnerable people. More than 100,000 people in Coventry have used a food bank in the past few years—that is unacceptable in 2017. These changes are made worse because they are being implemented alongside jobcentre closures, and the services on offer are also being privatised. The Government are removing jobs and services from parts of the country that need them the most, including Coventry. That will have long-lasting repercussions

The housing crisis has not been addressed either. Last year, fewer than 6,000 social houses were built, and that is simply unsustainably low. The Government pledged to build 300,000 homes by the mid-2020s, but houses are needed now—not just any houses, but affordable houses that help first-time buyers. The OBR said that the stamp duty cut would actually end up raising house prices, so this is yet another policy that has not been thought out.

Despite being a key issue during the recent general election, and despite it being a sector in desperate need of investment, there was, shockingly, absolutely no mention of social care in the Budget. Local government services in Coventry continue to have funding slashed, and there is no additional money for the police or fire services, making provision of vital services more and more impossible.

The NHS has again—[Interruption.]

[Madam Deputy Speaker (Mrs Eleanor Laing)]

Order. I was going to let the hon. Gentleman finish his sentence.

[Mr Cunningham]

I will finish there, Madam Deputy Speaker.

Smart Meters Bill

Jim Cunningham Excerpts

2nd reading: House of Commons & Money resolution: House of Commons & Programme motion: House of Commons & Ways and Means resolution: House of Commons
Tuesday 24th October 2017 Commons Chamber

[Greg Clark]

Yes, I have. Again, I am grateful to the right hon. Gentleman for asking that question. It is essential that the upgrade is available so that the smart meters that are installed under the SMETS 1 standard will be operable under the SMETS 2 standard. That has been a key part of the development and testing for exactly the reason he mentioned.

Smart metering upgrades the interactivity of the energy system in general. One big advantage of it is that if the system is fully interactive, less unneeded generating capacity needs to be invested in, with consequent savings to consumers. Even in the initial operation, it is estimated that by 2020 consumers can make net savings on their household bills to the tune of £300 million. In addition to the bill savings, smart metering will deliver benefits to the energy industry and to the economy more widely. It seems to me to be essential that if we want to plan a prosperous future, building on our strengths, this country should be the place in the world that can best integrate renewable energy and battery storage—not least in electric vehicles—with the consumer. Smart metering is an important element of that.

[Mr Jim Cunningham (Coventry South) (Lab)]

Has the Secretary of State considered people in the poorer sections of society who might have difficulty paying?

[Greg Clark]

Yes, and it is important that all consumer groups should be able to access the benefits, including lower bills. That has been an important requirement, and the Bill addresses it by extending the necessary powers to ensure that we have the regulatory ability to insist that the roll-out goes to all consumers and is not restricted to the more affluent.

Nuclear Safeguards Bill

Jim Cunningham Excerpts

2nd reading: House of Commons
Monday 16th October 2017 Commons Chamber

[Chris Green]

There will be an ongoing consultation on the relationship the university and scientific sector in the United Kingdom wants on the successor programme. As I am sure the hon. Gentleman will know, Horizon 2020 really focuses on top-end research—the things that we often do very well in the United Kingdom—which is why this country has a disproportionately large share of the Horizon 2020 money. On the successor programme, however, the moneys may be directed towards capacity building, which would favour other regions of the European Union more and the United Kingdom less. We must look into that and watch the direction of travel in the European Union. This is not set in stone, and we should not think that the successor programme to Horizon 2020 will merely “cut and paste” what we have today.

My big concern about where we go from here, post-Brexit, is the migration to the United Kingdom of European Union citizens and people from across the world who want to take up jobs in the nuclear industry. There is a huge opportunity in this, post-Brexit, for trained and qualified staff who currently work in Euratom to come across and work in the United Kingdom or for us to recruit and bring in people from across the world. Once we leave the European Union, we will have an opportunity to set the skill requirements we need in this country.

[Mr Jim Cunningham (Coventry South) (Lab)]

The hon. Gentleman is making some interesting points. I have consulted the powers that be in my constituency, where I have two universities, and there is concern about the consequences for science of ending the free movement of labour, certainly in relation to the specialists who come in to help train people. Experts very often come from Europe to teach science and technology, and there is concern because if we do not get this right, those people may well not be available for those universities.

[Chris Green]

That is a fair point, and why we have to ensure that we have as close a relationship as possible, consistent with having left, with the European Union post Brexit. Universities will be one of the prime sectors that the Government look to to ensure that we have that co-operation. It is such an important sector for the UK.

When thinking about who we need in the UK, people often focus on the highly qualified—professors, lecturers and so on—and the technicians that universities need can be overlooked. They are often paid significantly less, but we need them to come over, too.

Finally, will the Minister comment in the winding-up speech about arrangements for co-operation with countries outside the EU, such as the United States and Canada?

Higher Education and Research Bill

Jim Cunningham Excerpts

Wednesday 26th April 2017 Commons Chamber

[Carol Monaghan]

Absolutely. The UK is becoming an increasingly hostile environment for international students and they are being enticed to competitor countries with the promise of a more attractive route to post-study work options.

In Scotland, international students make an important contribution to the economy. The UK Government have focused their migration policy on control, rather than having effective policies that allow for flexibility and support in the area of migration. The loss of the post-study work visa is a blow to many students, but also to our local economy, which is missing out on those skilled people.

[Mr Jim Cunningham (Coventry South) (Lab)]

I thank the hon. Lady for giving way and apologise for coming in during her speech. International students are worth something like £7 billion to the economy. We have two very successful universities in Coventry and Warwick.

[Carol Monaghan]

In Scotland, the value is estimated to be £1 billion annually, so it is very significant. That is something we need to consider. There are not only benefits to our economy, but benefits to our community, such as the diversity that international students bring.

We call on the UK Government to take international students out of the net migration target. We look forward to seeing that in the next Queen’s speech. As the UK leaves the EU, I assume that EU students will be classified as international students. The effects of Brexit on Scotland’s world-class universities and research institutes cannot be ignored. If we do not get the immigration policy right, long-term damage will be done to our vital HE sector and the wider economy. As was pointed out earlier by my friend the hon. Member for South Down (Ms Ritchie), we need guarantees for EU nationals, both those working in higher education and prospective students at our universities.

Our problem in Scotland has always been emigration, not immigration. It is time for the Government to face the facts and take international students out of the net migration target. We need skilled people, and I hope very much that the Government will take a serious look at Scotland’s needs when considering future immigration policies. It is great to see that the Minister for Immigration is present; I hope that he has listened to some of the points that have been made today by Members on both sides of the House.

I understand that Lords amendments 229 to 240, which relate to schedule 9, have not been selected for debate, but I hope that the Minister for Universities, Science, Research and Innovation, if he is re-elected—or, indeed, the Department for Education—will clarify the role of UK Research and Innovation’s executive committee and its impact on research priorities. We will seek assurances that the committee will not prove detrimental to Scottish institutions by removing funding streams or allowing a large number of research priorities—and, therefore, funding—to stay in England.

SNP Members tabled a number of amendments in Committee and on Report. In particular, we wanted the devolved nations to be represented on the board of the UKRI to ensure that consideration would be given to research priorities throughout the United Kingdom. When we return, we will seek clarification on the composition of the board and assurances about the impartiality of board members.

Higher education is at a crossroads, and the United Kingdom is at a crossroads. I hope the path that we choose to take, both today and in the weeks, months and years to come, will protect this vital sector of the Scottish and the UK economies. It is important to all our futures that we get it right.

[Richard Fuller]

It is a pleasure to follow the hon. Member for Glasgow North West (Carol Monaghan). She made a number of points of principle with which I have a great deal of sympathy, especially about the long-term indications for our getting immigration policy right for our institutes of higher education.

Let me take this opportunity to praise my hon. Friend the Minister for Universities, Science, Research and Innovation. In the best of circumstances, this Bill would have required deft handling, compassion, understanding and compromise to resolve the issues in not just this House but the other place. Moreover, given the truncated procedure that has become necessary, the fact that we have reached this point is, I think, due to my hon. Friend’s significant abilities and dexterity in the management of different interests.

It is also a great pleasure to see that my hon. Friend the Minister for Immigration is in the Chamber—I can be nicer to him today. I will say of him that he is a true man of Yorkshire. I know that the principles of securing our borders and ensuring that the systems work effectively is at the core of everything that he has done as Immigration Minister, and those two great points of view have come together in amendments (a) to (c) in lieu of Lords amendment 156.

I support the Government amendments, because although I personally believe, like the hon. Member for Glasgow North West, that the long-term goal should be to exclude student numbers from the immigration statistics, I also think that we need precision first. The truth is that many of our immigration statistics are represented on sample sets. Information about immigration may be available to the Home Office in very specific circumstances, but out there in the great blue yonder—trust me, it is a great blue yonder—there will be a lot of misunderstanding about what immigration really is.

People have a very sensitive understanding of different types of immigration. We should not treat immigration as a single clump, because that is not how the population think of it. People understand that it can be good for the country, particularly when it comes to the transfer of skills and the transfer of people who will contribute in the long term to the economic vitality of our country. In that context, I think that the Government’s proposal is worthy of support, because it will establish a structure within which we can secure precision and that will be understood not only by the Government, but by the institutes of higher education. I think that that would provide a firmer basis for the future direction of the control of student immigration numbers that we seek.

[Mr Jim Cunningham]

I agree with most of what the hon. Gentleman has said, but including student numbers in the statistics totally distorts the true immigration figures. People therefore get the wrong impression about immigration, and that causes confusion.