Income Tax (Charge)

Karen Buck Excerpts

Thursday 28th October 2021 Commons Chamber

[Kwasi Kwarteng]

I thank the hon. Lady for her congratulations. However, I am surprised that she should express concern about the increase in the national living wage. I never thought I would live to see a Labour MP denigrate and decry that. We want to see a higher-wage, higher-productivity-based economy, and we are working hard to ensure that.

[Ms Karen Buck (Westminster North) (Lab)]

Will the Secretary of State give way?

[Kwasi Kwarteng]

Let me make some progress. To intervene so soon after an intervention is unusual. I will come back to the hon. Member.

During the pandemic, people and businesses have demonstrated remarkable levels of resilience. I fully agree with the right hon. Member for Doncaster North when he says that business has been heroic and people have been heroic. I am also immensely proud of the work done by the British Business Bank, for which my Department is responsible. Its schemes supported people and our economy to the tune of £80 billion, with Government-backed finance for 1.7 million businesses. That comes to the point made by the hon. Member for Hornsey and Wood Green (Catherine West). When it comes to the fundamentals of the economy, the Government are securing our economy and getting Britain back to work.

Contrary to all the prophecies of doom and gloom that recently came from Opposition Members, the Office for Budget Responsibility now expects our recovery to be quicker and the economy to return to its pre-covid level at the turn of this coming year. As the OECD and the International Monetary Fund show, there is considerable expectation that the UK will rebound strongly. In that context, our task turns to ensuring that our people and our businesses have ability and opportunity. They will not simply look back and complain about the situation that we have come through. They are positive and forward-looking. They believe in their country—unlike many Opposition Members, dare I say. We will achieve a strong rebound not by splashing cash indiscriminately as a number of Labour Chancellors did, dare I say, but by spending taxpayers’ money wisely to foster an environment that encourages innovation and growth.

I turn to the net zero agenda. I fully appreciate that many years ago the right hon. Member for Doncaster North was Secretary of State for Energy and Climate Change—I do not think I was in the House at that time—and I know that he shares the view that net zero is absolutely one of the most important strategic objectives of any Government.

Recall of Tumble Dryers

Karen Buck Excerpts

Monday 17th June 2019 Commons Chamber

[Kelly Tolhurst]

I thank my hon. Friend for that question. I am sorry to hear about her father, particularly since this urgent question comes the day after Father’s Day. She is absolutely right. This action serves as a warning to manufacturers that if they put unsafe products on the market, this Government will act to make them comply with the law. The beauty of the OPSS, which this Government set up in January 2018, is not only that it is a national body that takes responsibility for national crises, but that it supports local enforcers on the ground with scientific and research-based knowledge. I assure my hon. Friend that we are taking the matter seriously, and this is a warning to manufacturers that we will enforce the law if we believe that they are not complying.

[Ms Karen Buck (Westminster North) (Lab)]

I congratulate my hon. Friend the Member for Hammersmith (Andy Slaughter) on his dogged pursuit of this consumer scandal. Is not too much onus being left on consumers to understand the potential risks to their machines? If half a million Whirlpool machines are still unmodified, how exactly are the Government tracking progress? If they proceed to recall, which they should, how will they ensure that Whirlpool is successful in getting the message through to the owners of all those machines?

[Kelly Tolhurst]

The hon. Lady raises an important point on how we reach consumers, and part of the review covered the adequacy of the outreach programme. Our review found that Whirlpool needs to do more in that space, which is exactly why we issued a notice for Whirlpool to tell us what it will do further on the intention to recall. Whirlpool had time to respond, and we asked for further information on how it will get that information out to consumers. That will be a key part of how we review anything that Whirlpool submits to us, and the process will be ongoing if the recall notice is served or if Whirlpool decides to undertake a recall itself.

University of London Bill [Lords]

Karen Buck Excerpts

2nd reading: House of Commons
Tuesday 16th October 2018 Commons Chamber

[Ms Karen Buck (Westminster North) (Lab)]

I beg to move, That the Bill be now read a Second time.

I am very pleased to introduce the Bill. It is an important and, I hope, uncontroversial piece of proposed legislation. I do so partly as a constituency Member of Parliament whose constituency includes one of the prestigious member institutions of the University of London, the London Business School, and as a London MP who recognises the huge importance of the University of London overall to the economy and cultural life of our city and to our international standing.

The Bill’s primary purpose is to correct an historical anomaly and enable the various colleges and institutes that are currently members of the federal university to become universities in their own right, while also remaining a part of the University of London. The University of London was established by charter in 1836, although its history long predates that. It demonstrated an early commitment to diversity and to widening access by becoming the secular alternative to Oxford and Cambridge. The university’s present charter has been supplemented by a number of Acts of Parliament that prescribe its governance arrangements. The current arrangements are enshrined in the University of London Act 1994. I will be referring to the 1994 Act in the course of my comments.

The university was created as a federal institution in which colleges provided the teaching in accordance with the curriculum determined at the centre. For over 100 years, the university was directly funded as a single entity, distributing resources out to the colleges, all of which were originally also governed by centrally determined regulations on academic and other matters. Over the years, that position has wholly changed. The university remains a federal institution with 18 members, all of which are self-governing and autonomous, and most of which operate under separate royal charters.

[Henry Smith (Crawley) (Con)]

I graduated from University College London in 1991, when of course that institution was part of the federation of London University. I always thought it rather odd that, when UCL left and the federation continued because of the 1994 Act, the remaining colleges in the federation were restricted. Does the hon. Lady agree that the colleges being able to obtain university status, subject to this proposed legislation passing, will increase their global standing, which is even more important as this country leaves the European Union?

[Ms Buck]

I very much agree with the hon. Gentleman; that is absolutely at the heart of the Bill.

[John Howell (Henley) (Con)]

In my role as the Prime Minister’s trade envoy to Nigeria, we are trying to sell educational establishments in such countries. It is very difficult to sell the University of London, because people do not see it as a university; they see the colleges as having university status. Does the hon. Lady think that this will make my life easier?

--- Later in debate ---

[Ms Buck]

I believe that nothing is more important than to make the hon. Gentleman’s life easier, so I am pleased to broadly confirm—I hope—exactly what he is saying. There is a fundamental lack of clarity internationally. Many people in this country understand the importance of the University of London’s member institutes, which have fantastic reputations. However, particularly in the global marketplace for education, there is, as he describes, a lack of clarity about the overarching University of London structure and the institutes that are, in some cases, called colleges and schools. I went to the London School of Economics and some people will not understand the difference between that and a university, so the hon. Gentleman is completely right, as I will confirm even further as I work through my remarks.

The member institutes set their own academic criteria and in most cases have their own degree-awarding powers. In addition to the London Business School in my constituency, the colleges include University College London—called somewhat confusingly both a university and a college—King’s College, the London School of Economics, Birkbeck and the newest arrival, City University, which joined the federation only in 2016. Imperial College, on the other hand, left the federation in 2007, having no other option at the time for it to achieve university status.

The University of London provides a range of opt-in central services to its member institutions, including the university library at Senate House, in which I spent many happy hours, the careers service and collaboration with the university on its international academy programme, which provides distance learning to over 50,000 students worldwide. Members pay an annual subscription to the university and terms of federation membership are prescribed in the university’s statutes.

The key rationale for the Bill, as I said in response to interventions, is that it will facilitate the university’s member institutions becoming universities in their own right. The Higher Education and Research Act 2017 changed the regulatory landscape for the higher education sector. It opened it up to new providers and shortened the process for obtaining degree-awarding powers and, crucially, for obtaining university title.

Without this Bill, relatively unknown higher education providers will be able to obtain university status while institutions such as the LSE, UCL and King’s will not. The Bill therefore ensures that such institutions are not placed at a disadvantage in the increasingly competitive market for students and teachers. Branding can matter, even for institutions with reputations as high as those I have mentioned, and some of the member institutions have found that their status as a college can cause confusion. The term “college” can suggest that the institutions are subsidiary bodies of the University of London, when they are in fact self-governing, setting their own entrance criteria and, in the majority of cases, having degree-awarding powers. They are therefore universities in all but name.

The process for institutions applying for university status is governed by the Higher Education and Research Act. Any member institution seeking to become a university in its own right will need to apply to the Office for Students for permission. How does the Bill facilitate that process? The 1994 Act described the University of London member institutions as colleges, and as I have explained, that is increasingly unhelpful, so clause 2 would define membership of the federation as including any University of London institution that has the “status of a university”. Not all member institutions will want or be able to become universities. Not all award their own degrees, for example, and that is a necessary condition of becoming a university. The definition of a member institution maintains the reference to an institution that has the status of a college under the University of London statutes. Whether a university in its own right or a college under statutes, all member institutions will enjoy an equal status within the University of London federation.

Twelve out of the 18 member institutions now wish to seek university status and are presently applying for such permission. As all 12 are long-established and high-quality providers of higher education, it is anticipated that the Office for Students will recommend to the Privy Council that the change of status be approved. The Government have insisted that Privy Council approval is dependent on the Bill obtaining Royal Assent, so to be clear: no member institution will be permitted to become a university in its own right unless the Bill is enacted.

I turn now to the provisions on the making of University of London statutes. These statutes set the objects and powers of the university and establish and define the powers of the university’s institutions. To explain the procedure for making statutes is immediately to identify why reform is needed. The prescribed procedure involves two defunct bodies and a procedure requiring the active engagement of the college governing bodies, which have made it clear that they do not regard such a process as appropriate to the modern federal relationship.

The power to make statutes is conferred on the council of the university—a body that no longer exists. The drafter of the 1994 Act anticipated changes in university governance, and the term used in the Act to refer to the council also applies to

“such other body as the statutes may from time to time designate as the governing and executive body of the University”.

Since 2003, the governing body has been known as the board of trustees, and so, in accordance with the flexible definition of “the council” in the 1994 Act, statutes may be made by the board. That is not clear, however, from the 1994 Act. Furthermore, under section 3 of the Act, the text of any proposed statutes must be sent to the University of London convocation, as the association of graduates of the university, but it ceased to exist in 2003. The Bill will ensure that the terms used in legislation reflect the actual terms now used to describe the various University of London bodies.

The 1994 Act allows statutory consultees a very generous period of four months in which to make representations on proposals. If the governing body then wishes to proceed to make the statutes, it must pass two separate resolutions, with an interval of not less than one and not more than six months, and the statutes only have effect following approval of Her Majesty in Council. That is how University of London statute is made. Whatever the virtues of the system, swiftness is not one. The university regards the process as cumbersome and unnecessarily protracted, and the college governing bodies do not wish to continue with a process that once made sense but which is no longer appropriate.

[Sir Christopher Chope (Christchurch) (Con)]

Is it right to say that the view of the university is that the other encumbrances in the process are what cause the delay, not the Privy Council stage, which is a very quick stage?

[Ms Buck]

Absolutely. The cause of the difficulty is the combination of the length of the consultation and the notional involvement of bodies that no longer exist.

Quite simply, the ever-evolving relationship with 18 member institutions and the need to keep in line with the regular changes to higher education regulation mean the university needs to be able to refresh its statutes from time to time in a more dynamic way.

I want to be clear on one matter before I turn to the proposals for streamlining the statute-making powers. The university does not see the revision of the statute-making powers as an excuse to downgrade its obligations to consult. It is committed to undertaking effective consultation and understands this to be vital to the formation of statutes that command support and confidence. The Bill envisages that the initiative for making statutes will come from the board of trustees as the governing body of the university. Clause 3, however, also enables the collegiate council, which advises the board on all matters concerning the university, to submit its own proposals for consideration.

Ultimately, however, the board can reject the council’s initiative, reflecting the fact that it is the supreme decision-making body of the university. Statutes cannot be made unless the board has consulted the council—assuming they did not originate from the council—a recognised trade union and other bodies that the university considers appropriate. The explicit requirement to consult the trade unions was passed as an amendment in the other place and reflects the university’s commitment to ensuring proper consultation with all stakeholders.

I should emphasise again that all the member institutions were consulted on the Bill and have unanimously endorsed the proposal to legislate. As under the 1994 Act, the board does not have the final say. Reflecting existing arrangements, the Bill provides that the statutes will not be effective until approved by the Privy Council. The Privy Council’s remit over the approval of university constitutional arrangements was restricted under the Higher Education and Research Act 2017. Once section 56 of that Act comes into force, English universities established other than by royal charter—those limited by guarantee—will no longer be required to seek Privy Council approval for amendments to their governing documentation. If the requirement for such approval to amendments of statutes of chartered universities is also ended, clause 4(2) of the Bill allows for the alignment of that.

That, in essence, is the main reason for the streamlining of statutes and the ability of member institutions to call themselves universities in their own right. I hope very much that the House will support this important but, as I have said, hopefully uncontroversial legislation.

BHS

Karen Buck Excerpts

Thursday 20th October 2016 Commons Chamber

[Ms Karen Buck (Westminster North) (Lab)]

I am proud to be a member of a Select Committee that was part of the joint Select Committee process that led to the reports that have brought us here today. I congratulate both Select Committee Chairs on their leadership over recent months, and on their excellent speeches today. I also commend the superb speeches that Conservative Members have made today. Ably assisted by our excellent staff, the Select Committees have conducted a robust, indeed truly forensic, inquiry into the BHS scandal, and I think that that has been good for the reputation of the House.

I do not have a cynical bone in my body, but even I am slightly taken aback by the fact that it was today’s debate on the Committees’ report that brought Sir Philip Green into the public eye again in the last week or two, most recently when he indicated that he was closer to making a settlement for BHS pensioners. I welcome that, but it does show that a report, and the business of the House of Commons, can have a direct impact on affairs such as those that we are considering.

I do not always agree with the new Prime Minister. However, when she was asked in a recent television interview, “What makes you angry?”, she was absolutely right to reply,

“the powerful abusing their position.”

As we have heard from Members today, that should make us all angry. The sorry tale of British Home Stores is an exemplar: it is a tale of someone who accrued staggering personal wealth but then failed to meet his wider obligations to the company that had enriched him; a tale that ended with 11,000 jobs lost and 20,000 people—including my constituents and those of many other Members who are present—facing cuts amounting to, in extreme cases, up to three quarters of their pensions.

Some of those people were approaching pension age, and, in the last years of their working lives, were unable to take action to remedy the shortfall in their income. They still do not know how much money they will be able to draw on in order to pay their mortgages or rents and live out the rest of their lives. That is absolutely shocking. People deserve security in their retirement, and when they are let down we should be very concerned. As our report makes clear—this is something that I think gets lost—the pension contributions that companies make are not charitable donations; they are the means by which employers meet their deferred pay obligations, and it is those that have been breached.

I know that Sir Philip Green feels much maligned by the Committees’ investigation of the BHS sale, because he made that extremely clear when he was in front of us, but until and unless he provides proper redress for the pensioners, he has absolutely no right to do so. We have heard from many Members today about the scale of the enrichment and the extent to which the company was milked for dividends during its profitable years in the early part of the last decade. It is not for me to talk about how the company’s assets proved to be less robust than had been expected, or how profits taken in the good years left the company more exposed to the subsequent tougher climate, because that has been well done by others. What concerns me is what happened to the pension scheme after it moved from the surplus that it was in when the company was bought in 2000 to a deficit of £345 million in 2015 and £571 million by the time of its collapse.

What we know is that BHS and Sir Philip Green refused to make the employer contributions that were necessary to secure the sustainability of the pension scheme over the year, which caused concern to the board of trustees. Dr Margaret Downes told us that she was sufficiently worried about the declining state of the scheme during the second part of the last decade to seek assurances from the company about its long-term commitment to the scheme, including payment of the requisite contributions. The assurances were not given, and the contributions were not made.

In the summer, Sir Philip Green told our Committees that he had no involvement in the discussions about the pension scheme before 2012. He claimed to be unaware of the problem, and basically blamed the trustees. He suggested that they had made “stupid, stupid, idiotic mistakes”, and had been “asleep at the wheel” of the pension scheme. He indicated that he would have been willing to make much larger contributions had he only been aware of the growing deficit. Our Committees were deeply sceptical about those comments.

During the now infamous summer evidence session—I believe that it was later to become a surprise YouTube hit—we were asked to believe that someone who had a reputation for the micromanagement of BHS had known nothing whatsoever about the state of the pension fund. When he did find out, of course, he became actively involved in trying to do something about it, and at one stage, as we have heard, that led to a proposal for an unprecedented 23-year recovery programme based on a contribution that BHS saw fit to make rather than one driven by the needs of the trustees. That ended in the sale of BHS and its subsequent collapse, and it constituted a lack of due diligence that even those with absolutely no understanding of business will know to be truly shocking.

[Martin Docherty-Hughes (West Dunbartonshire) (SNP)]

The hon. Lady mentions due diligence. When I attended the Committee sessions, it seemed as though the blind were leading the blind. This was bigger than just Green; the trustees’ lack of governance was extraordinary.

[Ms Buck]

The entire process of the lead-up to the sale to Retail Acquisitions Ltd, which involved a range of participants, was truly stunning in its lack of robust inquiry and checks. I hope that the lesson will be learned by all the agencies concerned, by Government, and by business. These are issues of judgment and personal responsibility as well as issues of law, all of which were sorely missing from that process.

It is little wonder, then, that Simon Walker, director general of the Institute of Directors, which is normally an assiduous defender of the free market, said that the circumstances of the collapse of BHS were

“a blight on the reputation of British business”.

British business has much to be proud of. As we have already heard, we want to have an environment in which business flourishes and risks can be taken. I completely endorse that. Sometimes, there will be failures. Indeed, pension funds have gone into deficit in many cases —BHS was not alone in that regard—but British business needs to ensure, and be part of a process whereby, its reputation as a whole is not sullied by the shocking and cavalier behaviour of some of the outliers, whether in respect of employment law or the handling of pensions.

In the past few years, and particularly since the 2008 financial crash, we have seen shockwaves of anger and alienation throughout our political system. That has been the case in much of the developed world. There is a sense that the game is rigged and that the wealthy and powerful have their own rules and are not held to account, whether for incompetence, greed or, sometimes, worse. The 2008 crisis highlighted that sense, but it did not begin there and it did not end there. There must be consequences for this sort of behaviour, for the sake of the reputation of good business. There must be consequences, otherwise Government cannot look themselves in the face. They cannot be held in high regard if they do not hold people to account. Those consequences must be proportionate and achieved through due process, but they must be there. That has been excellently set out by my colleagues on the Select Committees. They have set out the changes that are necessary in the law, in corporate governance and in the process by which dividends are paid out when pension funds are in deficit.

The House must scrutinise all those measures and consider introducing them. However, there must be individual accountability. What I want to see more than anything—more than further damage to Sir Philip Green’s reputation, more than his humiliation, more than the removal of his knighthood—is the money. I want the damage that has been done to his reputation in the Select Committee process and in this debate finally to bring him to the table to do the right thing, so that he can hold his head up high, the pensioners can get the deal that they deserve, and all of us who have been engaged in the scrutiny of the sorry tale of BHS will know that that work has been vindicated.