Contingencies Fund (No. 2) Bill

Jim Shannon Excerpts

2nd reading
Thursday 11th March 2021 Commons Chamber

[Andrew Jones (Harrogate and Knaresborough) (Con)]

I will, of course, follow your advice as scrupulously as ever, Mr Deputy Speaker.

This Bill is about cash flow. It is not about all the stuff that we have just been hearing from the shadow Minister. All organisations have to manage their cash flow and meet their liabilities, and failure to do so is a significant reason for corporate collapses. It is, obviously, different in the public sector, but the rule about meeting liabilities remains as Government react to urgent situations. There are also clear mechanisms for making sure that in the event of a cash need, the cash will be there. That is what the Contingencies Fund is.

This Bill is about the Treasury’s capacity to make repayable advances to other Departments, so that they can react to events if needed. Parliament has long recognised that principle. The legislation governing it is 45 years old, but in fact the principle was established by Treasury minute in 1862, when the Contingencies Fund was created. For this financial year—and the next, if we pass this Bill—the threshold allowed in the legislation has been increased, and for obvious reasons. We are dealing with the greatest health crisis in 100 years.

[Jim Shannon (Strangford) (DUP)]

I spoke to the hon. Gentleman beforehand. Although I understand that this is specifically about cash flow, the whole House recognises that there is a real crisis in cancer treatment when it comes to diagnosis and surgical operations, and many people have died waiting for those to happen. Does he agree that covid-19 has increased the demand for cancer care, and therefore all requests that come from the NHS and the Department of Health and Social Care must be treated sympathetically and urgently?

[Andrew Jones]

The hon. Gentleman makes a very good point. There is no doubt at all that we have seen some health treatments delayed as a result of the crisis, and that is a real tragedy. He is right that cancer is one of those where we should be most concerned, and the requests that come in should be treated with urgency and compassion as we seek to catch up on the treatments that the people we represent urgently need. That was a wise point.

I go back to the core purpose of the Bill and why it has been introduced. The Government needed to respond quickly and at scale, and they have done so. The Bill before us is about renewing the increased capacity for the next financial year, and we are only three weeks away from the new financial year. We are being asked to approve a one-year increase in the limit from 2% to 12%. That is, of course, a big jump, which amounts to more than £100 billion. We should also perhaps remind ourselves that the House approved an increase in the limit to 50% for this financial year—truly exceptional in every way.

I support increasing the limit in the Bill. We are not through this pandemic, and it is not hard to imagine circumstances where the Government have to react urgently ahead of the regular voting provision under the normal supply procedure. One of the lessons of the past year has been that the course of the pandemic has not been linear. None of us can guarantee that the future will not require urgent action. In reality, we can probably all predict that it will.

As my right hon. Friend the Minister said, this is quite a dry Bill, but once a Treasury Minister, always a Treasury Minister. That does not mean, however, that we should not scrutinise; of course we should. But the Bill does not increase budgets, and it does not give the Government a blank cheque. These are cash advances, which are highlighted to Parliament through the normal estimates booklets and memoranda, and then we vote on them. There is transparency as funds are drawn upon by Departments. There is guidance agreed between the Treasury, the National Audit Office and Parliament. That means that written ministerial statements are published throughout the year and cash advances are included in the main or supplementary estimates. I hope we will not be facing a contingencies Bill for the 2022-23 financial year. The progress that we are making in tackling the virus is obviously fantastic, but the consequences will be felt for a long, long time.

It is too early to spend time on an inquiry on the lessons from the pandemic, but one thing I am sure we will consider in due course is how well and how quickly government—I am talking about the UK Government, devolved Administrations, local government and, above all, the NHS—have responded. They have been nimble and dynamic in their response. This Bill is simply about facilitating the cash flow to allow that quick response and that is why we should all support it.