Post Office (Horizon System) Offences Bill
Kemi Badenoch ExcerptsWednesday 20th March 2024
(1 month, 1 week ago)
Commons ChamberRead Full debate Post Office (Horizon System) Offences Bill 2023-24 View all Post Office (Horizon System) Offences Bill 2023-24 Debates Read Hansard Text Watch Debate Read Debate Ministerial Extracts
The Secretary of State for Business and Trade (Kemi Badenoch)
I beg to move, That the Bill be now read a Second time.
I am pleased to present the Bill for its Second Reading. It will quash the convictions of those affected by the Post Office Horizon scandal in England and Wales—one of the greatest miscarriages of justice in our nation’s history. The legislation will clear the names of sub-postmasters whose lives were ruined because of the Horizon scandal: those wrongly convicted of or cautioned for offences of false accounting, theft and fraud, all because of a faulty IT system that the Post Office had implemented.
Instead of listening to whistleblowers such as Alan Bates when they raised concerns, the Post Office viciously pursued them for the shortfalls. Some were suspended or dismissed; hundreds were prosecuted, convicted and imprisoned; others were harried as thieves by their local communities. Several were driven to suicide. The Government cannot turn back the clock or undo the damage that has been done, but we will seek to right the wrongs of the past as best we can by restoring people’s good names and ensuring that those who have been subject to this tragic miscarriage of justice receive fair and full redress. The Bill represents a crucial step in delivering that.
Ian Paisley (North Antrim) (DUP)
The whole House appreciates the efforts that the Government are making to rectify this problem at last, but I appeal to them to listen to the cross-party representations made from both sides in this House and all sides in Northern Ireland, including by the First Minister, the Deputy First Minister and the Justice Minister for Northern Ireland, who have appealed for the fewer than 30 people in Northern Ireland who have been affected by the scandal to be included in the Bill.
Kemi Badenoch
We are working closely with the Northern Ireland Executive. We have carefully considered the territorial extent of each piece of legislation, and we are rigorous in our commitment to devolution. The hon. Gentleman should be assured of the amount of work that is taking place to ensure that we get the Bill done properly in a way that will not have unintended consequences. I thank him for that point.
This new legislation will quash all convictions that meet the clear and objective conditions laid out in it. We recognise that postmasters have suffered too much for far too long, which is why convictions will be quashed automatically when the Bill receives Royal Assent, removing the need for people to apply to have their conviction overturned.
Sir Jeremy Wright (Kenilworth and Southam) (Con)
I am extremely grateful to my right hon. Friend for giving way. I understand entirely why the Bill is necessary. She will agree that it is important that we do not, through the Bill, set any precedent for the interference of this House in individual convictions, unless there are exceptional circumstances such as these. That means that the Bill must be tightly drafted. At the moment, condition E—the last of the conditions that she has mentioned—is that
“at the time of the alleged offence, the Horizon system was being used for the purposes of the post office business.”
Why is that not phrased differently to say that Horizon-based evidence was presented in the case against the person convicted? There is a material difference between those two things. I just seek to understand why she has chosen that formulation rather than the alternative.
Kemi Badenoch
My right hon. and learned Friend makes a good point about the final condition in the Bill. That is something that we considered, but it would likely have required a case-by-case, file-by-file assessment of each prosecution. That would have added significant time and complexity, which is what our solution avoids. One thing that I have been keen to emphasise is that speed and pace are critical. This has taken far longer than I would have wanted, and I would not have gone for a solution that would have impeded this and created complications.
Liam Byrne (Birmingham, Hodge Hill) (Lab)
I put on the record my thanks to and commendations for the Under-Secretary of State for Business and Trade, the hon. Member for Thirsk and Malton (Kevin Hollinrake), for the way in which he has approached the groundwork for the Bill.
Among those excluded from the scope of the Bill are those who went to the Court of Appeal and lost their case, or were not given leave to appeal to the Court. What we now know would have been quite useful in many of those cases. Should we enlarge the scope of the Bill to include those who lost their case at the Court of Appeal or were not given leave to appeal in the first place, as many of them may well be truly innocent?
Kemi Badenoch
I thank the right hon. Gentleman for that point. That is also something that we considered carefully. It is part of the trade-off that we had to make in doing something unprecedented: Parliament overturning convictions. We respect the judgment of the Court of Appeal—it has gone to an appellate judge. We are willing to consider some of those cases individually just to ensure that nothing has been missed, but the Bill has been drafted in consultation with the Crown Prosecution Service and the judiciary. We want to ensure that we are bringing everyone with us. Concerns such as his have been raised, but this is more or less the consensus that we think will get the Bill done, and allow redress, as quickly as possible.
Sir David Davis (Haltemprice and Howden) (Con)
I will elaborate on this point further when I speak—hopefully, if I catch Mr Deputy Speaker’s eye—but there is already data about the cases that the right hon. Member for Birmingham, Hodge Hill (Liam Byrne) referred to, those that are outside the Horizon case itself but were attempting to get themselves exonerated on the basis of other data. As far as I can see, they failed precisely because they were not part of the Horizon case, so I ask the Secretary of State to return to this issue before Report and look at whether we can solve that problem.
Kemi Badenoch
I thank my right hon. Friend for that intervention. That is something we can look at again at further stages of the Bill. We understand the issue that hon. Members are trying to resolve, and agree with them that we need to make sure that everybody who deserves justice gets justice, but we also have to be careful to make sure that we are not exonerating people who we know for a fact have committed crimes.
Mary Robinson (Cheadle) (Con)
I am grateful to my right hon. Friend for giving way, and I commend her work and that of my hon. Friend the Member for Thirsk and Malton (Kevin Hollinrake), not only in recognising the plight of these people and putting in place compensation for their suffering, but in ensuring that these criminal convictions are expunged from their record. It is really important for these people that they regain their standing within their communities.
As my right hon. Friend has rightly said, so many of these whistleblowers were failed by the current law: the Public Interest Disclosure Act 1998. It is really vital that we not only put that right, but have a good look at the law again. I know that a framework review is going on, and have spoken to my right hon. Friend and my hon. Friend about what more can be done. I have tabled a whistleblowing Bill that will sort this problem out. It lands within the Department for Business and Trade—it is something that is within my right hon. Friend’s gift. Will she support my private Member’s Bill on Friday?
Kemi Badenoch
I thank my hon. Friend for all the work she does in chairing the all-party parliamentary group for whistleblowing. She is right that this issue needs consideration, and we are going to look again at the whistleblowing framework—it is something that comes up time and time again in many respects. I will not comment yet on her private Member’s Bill, because I have not seen it, but I thank her for all her work on this issue.
Mr Kevan Jones (North Durham) (Lab)
I welcome this Bill. I know that it is groundbreaking and possibly sets some nerves off with the judiciary, but I think the judiciary need to look at themselves and how they have dealt with some of these cases.
On the point that my right hon. Friend the Member for Birmingham, Hodge Hill (Liam Byrne) raised, a small number of cases are not within the scope of the Bill. I perfectly understand why, but we have to get those cases looked at again, because evidence has come out in the Sir Wyn Williams inquiry that was not available at the time. Will the Secretary of State commit to at least sit down with the judiciary to look at these cases and emphasise the fact that there is new information, and that responsibility for some of this injustice has got to lie with the justice system?
Kemi Badenoch
I thank the right hon. Gentleman for his intervention. The courts dealt very swiftly with the cases before them—perhaps a bit too swiftly. That is why the sub-postmasters suffered so many miscarriages of justice, and it is right that we make their exoneration as simple and quick as possible, so while my priority is passing this Bill for the bulk of the people who have suffered, that does not mean we will not be able to look at other scenarios later and see if we can find solutions where we genuinely believe that there has been a miscarriage of justice. That is not for me to do at the Dispatch Box—it will not be up to Ministers. There will be caseworkers who will carry out that work, but we have to be careful to make sure that we are exonerating the right cohort.
Mr Jones
I hear what the Secretary of State says, but I would just say to her that this is a small number of people and they have to be looked at. Can I ask that she shows the same zeal that her hon. Friend the Member for Thirsk and Malton (Kevin Hollinrake) has shown in his approach to this process? We need a commitment, not to get these cases sorted today—I accept that the Secretary of State cannot do that—but that the Department will look at them. I think that will send quite a strong message out to people.
Kemi Badenoch
The Department can always do that. This is something that we believe is so critical in order to make sure everybody gets the justice they deserve, and we need to make sure that we carry out the process in such a way that everyone has confidence in it. We can continue to look at cases and see if there are other solutions, but as the right hon. Gentleman has rightly said, that will be outside the scope of this Bill.
Sir Robert Neill (Bromley and Chislehurst) (Con)
I am very grateful to the Secretary of State for giving way, and I also pay tribute to the exceptional work of my hon. Friend the Member for Thirsk and Malton (Kevin Hollinrake) and the way in which he has engaged in what is a sensitive issue, not least constitutionally. Does my right hon. Friend accept that it is not ideal under any circumstance for this House to trespass upon the legitimate preserves of the independent courts? It should only do so under the most exceptional circumstances. There is a case that this is one of those instances, but while we can legitimately criticise failings in the criminal justice system—such as in disclosure, which is part of the system—it is important that we do not get into the territory of impugning the individual decisions of judges made in good faith on the evidence properly before them.
One thing we could do to emphasise the exceptional nature of the Bill would be to introduce a sunset clause, so that at an appropriate time when the Bill has served its purpose—perhaps some way in the future, once those who need to be found and contacted have been able to come forward and have their convictions quashed— it would no longer be the constitutional anomaly that it might otherwise be if it stayed on the statute book indefinitely.
Kemi Badenoch
I am very happy to consider a sunset clause. My hon. and learned Friend makes a very good point, and I really appreciate the fact that he can see the tightrope that we are walking: getting justice for postmasters while not interfering with judicial independence.
Sir Robert Buckland (South Swindon) (Con)
I think it is important that we emphasise the wholly exceptional nature of this legislation, but we are dealing with wholly exceptional circumstances—we hope. The point about disclosure is one that I cannot make strongly enough, and we have to look again at our presumptions about machines and what they produce when it comes to criminal litigation.
Can I press my right hon. Friend to reiterate the wholly exceptional nature of this legislation? I think we need to be careful when it comes to a sunset clause, because we do not want to end up frustrating the purpose of the Bill, which is to deal with the hundreds of people who have lost faith in the system and might be difficult to track down and identify. I am not particularly in favour of a sunset clause, but we do need to emphasise the exceptional nature of this legislation.
Kemi Badenoch
I am grateful to my right hon. and learned Friend for his intervention. I am very happy to emphasise that, and will do so again later in my speech. I do enjoy it when we have two lawyers who disagree on a particular point; I will be taking this as their application to join the Bill Committee.
The Bill includes a duty on the Government to take all reasonable steps to identify convictions that have been quashed. It also creates a duty to notify the original convicting court, so that records can be updated and people’s good names can be restored. Other records, such as police records, will be amended in response. The Bill makes provision for records of cautions for relevant offences relating to this scandal to be deleted. While the financial redress scheme will be open to applicants throughout the UK, the Bill’s measures to overturn convictions will apply to England and Wales only.
Mark Pawsey (Rugby) (Con)
We on the Business and Trade Select Committee heard absolutely harrowing accounts from postmasters of what they had gone through as a consequence of the Post Office’s actions, but many of those cases took place many years ago. Can the Secretary of State be confident that the audit process in an organisation such as the Post Office will in future identify what has happened at an earlier stage, and does she agree that legislation such as this should never come before this House again—that this should not happen?
Kemi Badenoch
I believe that the inquiry being led by Sir Wyn Williams is currently looking at that issue. It is important that audit processes work at the highest level, and that people are able to rely on and have confidence in them, so I thank my hon. Friend for raising that point.
On the question of territorial coverage, as I said earlier to the hon. Member for North Antrim (Ian Paisley), my Department will continue working closely with the Northern Ireland Executive and the Scottish Government to support their approaches to addressing this scandal, ensuring that every postmaster who has been affected receives the justice they deserve, irrespective of where in the United Kingdom they are. Indeed, my colleague and hon. Friend the Member for Thirsk and Malton (Kevin Hollinrake), the Minister for postal affairs, has already met Justice Ministers in the Scottish Government and the Northern Ireland Executive to offer our support.
Stephen Farry (North Down) (Alliance)
I accept that the Department is very keen to respect the devolved settlements in both Northern Ireland and Scotland, but can I stress to the Secretary of State that there is political consensus in Northern Ireland, and Ministers in the newly restored Executive would welcome Parliament acting in this particular area?
Due to the nature of devolution in Northern Ireland, we have to have a public consultation, so in the best-case scenario we are looking at well towards the end of this year before we can replicate legislation here in Westminster. As this was a national scandal, it does require a national solution to avoid a situation of inequity in which some postmasters in parts of the UK are exonerated while others are still waiting.
Kemi Badenoch
I take the point the hon. Member makes very seriously. We do understand, but we want to make sure that we do not create any possible unintended consequences by legislating on devolved issues, so we are working hand in glove with the Northern Ireland Executive to make sure this goes through as quickly as possible. We know that the numbers there are much smaller, and that the postmasters there have been identified. He is right to raise the point, but I want to reassure him that we have every confidence that we will be able to get this done at the same pace.
Liam Byrne
Could I put that question in a slightly different way? The Minister for postal affairs has set out an ambitious timetable for the passage of this law, the overturning of convictions and the dispensation of compensation, with it all possibly being done and dusted—with hope, and a following wind—by the end of July. Could the Secretary of State commit to a similar timetable when it comes to the cases that have been raised in Northern Ireland?
Kemi Badenoch
That is certainly something we can encourage the Executive to work to, but I cannot personally make that commitment because it would not solely be up to me. However, I just want to reassure the House that this is something we care about. We are not prioritising England and Wales because it is England and Wales; we are doing what we can as quickly as we possibly can to make sure that we do not create problems later by rushing and not doing things properly. I think that that is a good and ambitious target, but it would not be up to me to make such a commitment.
I am aware that the approach we are taking in this Bill is a novel one. With it, Parliament is taking a function usually reserved for the independent judiciary, as my right hon. and learned Friends the Members for Kenilworth and Southam (Sir Jeremy Wright) and for South Swindon (Sir Robert Buckland) and my hon. and learned Friend the Member for Bromley and Chislehurst (Sir Robert Neill) have said. However, I am equally aware that the postmasters’ long and punishing fight for justice must now be swiftly drawn to a close. The circumstances surrounding the scandal are wholly exceptional, and they demand an exceptional response from Government, so I would like to take this opportunity to reassure the House that the introduction of the Bill is in no way a reflection on the courts and the judiciary, which have dealt swiftly with the cases before them.
Katherine Fletcher (South Ribble) (Con)
I would like to commend both the Secretary of State and her team for bringing forward this Bill. The sub-postmasters have faced a miscarriage of justice that has taken many people’s breath away. I am aware that this is specific and focused legislation, but two South Ribble constituents came to see me who had been Royal Mail customers, and they described scenarios of prosecutorial practice very similar to what sub-postmasters were subject to. Would the Secretary of State consider expanding the scope of the legislation in future to other people who may have been subject to poor treatment?
Kemi Badenoch
I thank my hon. Friend for her intervention. I can look specifically at the cases she raises, but I think they may actually be covered by this Bill. I would be wary of expanding the scope too broadly. The consensus we have with the CPS, the judiciary and so on has been achieved by the legislation being very tightly scoped, but we do want to make sure that people who have been at the end of an injustice can have those wrongs righted. I am very happy to look at the specific cases of her constituents.
Andy Carter (Warrington South) (Con)
I am very clear that this Bill is about correcting convictions that were made in error. However, there are of course a number of employees—direct employees—of the Post Office who were never convicted, but had their good name ruined and their careers destroyed, and have found it very difficult to gain employment because they were unable to get references from their previous employer. Indeed, probably the worst thing that happened to them is that they were identified in their community as people who were perhaps stealing from pensioners or treating members of their community unfairly. This Bill will do nothing for them. Could the Secretary of State outline what the Post Office is doing to contact those individuals who were disciplined by the Post Office and dismissed, so that they too can have justice?
Kemi Badenoch
I thank my hon. Friend for that question. He is right that many people had their reputations traduced because of what happened with the Horizon scandal. Where shortfalls were falsely made by the Post Office and they had to pay, we have compensation schemes to address those sorts of wrongs. Because this Bill is specifically about overturning convictions, it cannot apply to them, but where they have suffered other damage, we have compensation schemes that we hope will apply in those circumstances.
We have not taken the decision to legislate in this way lightly. Given the factually exceptional circumstances of the Horizon scandal, the number of postmasters involved and the passage of time since the original convictions, it is right that the state now acts as quickly as possible. Any further delay would be adding further insult to injury for postmasters who have already endured what I believe is an arduous wait. Indeed, some have lost trust in the system, and want no further engagement. In many cases, the evidence they would need to clear their names no longer exists.
However, I must make two points clear to the House. First, the Government’s position is that it will be Parliament, not the Government, that is overturning the convictions, so there will be no intrusion by the Executive into the proper role of the judiciary. Secondly, this legislation does not set any kind of precedent for the future. It recognises that an extraordinary response has been necessitated by an extraordinary miscarriage of justice.
On this Bill receiving Royal Assent, no further action is required by the victims of this scandal to have their convictions quashed. The Government will take all reasonable steps to notify the relevant individuals and direct them to the route for applying for compensation. Further details of this process will be set out in due course.
Liam Byrne
The Secretary of State is being characteristically generous in giving way again. The evidence the Select Committee heard was that many people seeking compensation for the injustice they have suffered found it very complicated and very confusing to understand the range of case law required to put in particular kinds of claim—for example, for loss of reputation. When she triggers the notification provisions, would she reflect on something she could add, which is a tariff to help people put in claims for the right kind of compensation? What none of us would want to do, having overturned the convictions, is to let people get short-changed on the compensation. Providing a standardised tariff could cut through so much of the complexity and help people get what they are due.
Kemi Badenoch
I thank the right hon. Gentleman. I know that is a recommendation from his report, and it is something we are actively looking at and considering. As the Bill progresses through the House, there will be many suggestions that we will be able to look at to see whether it can be improved in any way. However, we must make sure that we do so in a way that does not jeopardise any of the objectives of the Bill—any of them at all.
As I was saying, further details will be set out in due course, and there will be a process for anyone to come forward where their convictions meet the criteria but we have been unable to identify them. The new primary legislation will be followed by a route to rapid financial redress on a basis similar to the overturned convictions scheme, which is currently administered by the Post Office, so we do not need provisions in the Bill to deliver that scheme. My Department, not the Post Office, will be responsible for the delivery of redress related to the quashing of these convictions. The Minister for postal affairs will return to the House at a later date to provide details on how we intend to deliver that redress.
Mr Kevan Jones
I welcome the changes that have been made in the compensation. Some of the proposals—for example, for fixed sums—are going to make a lot of cases easier to sort out. I do not feel comfortable having the Post Office anywhere near this, frankly, and neither do the sub-postmasters. Will the Secretary of State think about a system of compensation that in practice cuts out the Post Office? There is no trust there among the sub-postmasters. Do I personally have any faith in the Post Office? No, I do not.
Kemi Badenoch
I thank the right hon. Gentleman. That is one reason why my Department will be looking after the redress delivered by the scheme.
Sir David Davis
Let me reinforce the point made by the right hon. Member for North Durham (Mr Jones). There are people writing to me this week about the current handling of their cases by the Post Office and Post Office lawyers; frankly, it is barbaric. The Post Office needs to be taken out of it.
Kemi Badenoch
I reassure my right hon. Friend that this is something I am looking at in great detail. The Post Office has clearly been a dysfunctional organisation for a very long time, and that is one reason why I have been actively taking steps to look at the management and processes in place, which, as he rightly says, many of the sub-postmasters have lost faith in.
It goes without saying that work to offer prompt financial redress alongside the Bill continues. As of 1 March, 102 convictions have been overturned through the courts. Of those 102 cases, 45 people have claimed full and final redress, and of those 35 have reached settlement. The Post Office has paid out financial redress totalling £38 million to postmasters with overturned convictions. Under the Horizon shortfall scheme, as of 1 March, 2,864 eligible claims have been submitted, the vast majority of which have been settled by the Post Office, and £102 million has been paid out in financial redress, including full and final settlements and interim payments.
Finally, under the group litigation order scheme, working from the same date, 132 claims have been submitted, 110 have been settled by my Department, and £34 million has been paid out in financial redress, including full and final settlements and interim payments. Officials in my Department are working hard to get those cases settled quickly, and we have made offers within 40 working days in response to 87% of complete claims.
In summary, the Bill amounts to an exceptional response to a scandal that was wholly exceptional in nature, and has shaken the nation’s faith in the core principles of fairness that underpin our legal system. We recognise the constitutional sensitivity and unprecedented nature of the Bill, but I believe it is essential for us to rise to the scale of the challenge. The hundreds of postmasters caught up in this scandal deserve nothing less. Of course, no amount of legislation can fully restore what the Post Office so cruelly took from them, but I hope the Bill at least begins to offer the closure and justice that postmasters have so bravely campaigned for over many years, and that it affords them the ability to rebuild their lives. For that reason, I commend the Bill to the House.
Trade (Comprehensive and Progressive Agreement for Trans-Pacific Partnership) Bill [Lords]
Kemi Badenoch ExcerptsTuesday 19th March 2024
(1 month, 1 week ago)
Commons ChamberRead Full debate Trade (Comprehensive and Progressive Agreement for Trans-Pacific Partnership) Act 2024 View all Trade (Comprehensive and Progressive Agreement for Trans-Pacific Partnership) Act 2024 Debates Read Hansard Text Watch Debate Read Debate Ministerial Extracts Amendment Paper: Consideration of Bill Amendments as at 19 March 2024 - large print - (19 Mar 2024)
The Secretary of State for Business and Trade (Kemi Badenoch)
I beg to move, That the Bill be now read the Third time.
I would like to thank Members across the House and noble Lords in the other place for the interest they have shown in this legislation throughout its passage. The Bill may be narrow in scope, but the underlying agreement it relates to and the benefits it could bring for British business, the economy and the British people are wide-ranging. By acceding to the comprehensive and progressive agreement for trans-Pacific partnership, we will strengthen our ties with some of the world’s most dynamic economies and gain greater access to the Indo-Pacific region, which will account for the majority of global growth and around half of the world’s middle-class consumers in the decades to come.
Crucially, acceding to the CPTPP will mean improved market access for UK exporters in existing CPTPP parties, including Malaysia and Brunei—our very first free trade deal with these fast-growing economies. In turn, the partnership will simplify supply chains and cut costs for innovative firms based here in the UK, such as Wrightbus, a long-established family-owned Northern Ireland bus manufacturer, which will benefit from opportunities to import parts at lower tariffs from Malaysia. We have also agreed more liberal rules of origin with Malaysia, making it simpler for British brands such as Jaguar Land Rover to export British-designed, British-made vehicles to that market at lower tariffs.
However, our future accession will be good not just for British businesses selling their goods abroad but for consumers here at home. It could provide consumers with wider choice and cheaper prices at the supermarket checkout, on everything from Chilean and Peruvian fruit juices to honey and chocolate from Mexico. Inward investment in the UK by CPTPP parties will be encouraged when we accede, building on some £182 billion-worth of investment in job-creating projects in 2021 alone.
As hon. Members will know, the Bill affects the whole of the UK. Clause 3 and the parts of the schedule relating to Government procurement engage the Sewel convention, so we have sought legislative consent from the Scottish Parliament, the Senedd and the Northern Ireland Assembly. Let me reassure hon. Members that there has been regular engagement with the devolved Administrations before the Bill was introduced and throughout its passage at both Ministerial and official level. I thank the devolved Administrations’ Ministers and their teams for working so constructively with us. It is in part thanks to their efforts that the Scottish Parliament passed a legislative consent motion in February. The Welsh Government published a legislative consent motion on 5 March and recommended that consent be granted to clause 3 and relevant parts of the schedule. Due to a mis-step during the moving and consideration of the motion, that legislative consent was not granted. I understand there are plans for a further Senedd vote on legislative consent for clause 3 and relevant parts of the schedule. However, in the event that a further vote is not scheduled in the Senedd before Royal Assent, the UK Government will proceed with the Bill without consent from Wales.
Members will know that the Northern Ireland Assembly was suspended when the Bill was introduced last November, which prevented us from seeking legislative consent at that time. However, my Department has engaged with Northern Ireland officials throughout this period, providing them with updates as the Bill has progressed through Parliament.
Jim Shannon (Strangford) (DUP)
I thank the Secretary of State for her positive remarks about all the regions of the United Kingdom, which is good to hear. In her discussions with the Northern Ireland Assembly, has there been an opportunity to engage with the businesses in Northern Ireland that have been holding things together, and the Ulster Farmers’ Union? The Secretary of State is always energetic when it comes to pursuing those matters, but it is important to have that reassurance.
Kemi Badenoch
The hon. Gentleman raises a good point, and he is quite right. My right hon. Friend Minister for Trade Policy has engaged with them. In fact, upon the return of the Northern Ireland Assembly, he wrote to the Minister for Finance at the earliest opportunity to request legislative consent. I am grateful that the Minister agreed with the Bill’s devolution analysis and, in principle, to begin the legislative consent process. Nevertheless, we still face a challenging timeline and a pressing need for the Bill to complete its passage. That is vital to allow for secondary legislation to be made and for ratification of the UK’s accession protocol. As such, we cannot delay passage of the Bill to allow the Northern Ireland Executive and Assembly greater time to consider legislative consent. That would jeopardise all the current ratification timelines. I recognise that the legislative consent process is normally concluded before the last amending stage in the second House. Given the timing of the return of the Northern Ireland Assembly, that has been extremely challenging, but I believe it is still right that we allow the Northern Ireland Executive and Assembly as much time as we can to consider our request. In the event that legislative consent is not granted by the Northern Ireland Assembly before the deadline for Royal Assent, we will still have to proceed. Failing to do so would compromise the commitments we have made in our accession protocol.
On Second Reading, I outlined the wealth of benefits that will come with the UK’s accession to the CPTPP: the growth-spurring and business-boosting effect it will have on our economy. Since that time, we have had some spirited and worthwhile debates. I would particularly like to thank the hon. Members for Harrow West (Gareth Thomas) and for Gordon (Richard Thomson) for the constructive manner in which they scrutinised the legislation. I commend those Members who sat on the Public Bill Committee, including my hon. Friend the Member for Shipley (Philip Davies) and the hon. Member for Ealing Central and Acton (Rupa Huq), who showed their great expertise as Chairs. I also thank the Minister for Trade Policy, my right hon. Friend the Member for Chelsea and Fulham (Greg Hands) for expertly shepherding this legislation through the House with his consummate skill and good humour, and for delivering what appears to be a clean Bill. I will let Members review Hansard to see how many times my right hon. Friend reminded the hon. Member for Harrow West that he voted for CRaG. I think I heard that quite a lot throughout the debate.
It would be remiss of me not to mention a number of other Members by name for their valued input throughout the Bill’s passage, including my hon. Friend the Member for Totnes (Anthony Mangnall), whose Second Reading speech and interventions made an excellent case not just for UK accession to CPTPP, but for the benefits of free trade more generally. I am also grateful to him for highlighting the scrutiny provided by the recent Trade and Agriculture Commission report on the UK’s agreement to accede to the CPTPP—a report that stated that the CPTPP does not require the UK to change its levels of statutory protection in relation to animal or plant life, health, animal welfare or environmental protection.
On Second Reading, we also heard useful insights from several of the Prime Minister’s trade envoys, notably my hon. Friends the Members for Wyre Forest (Mark Garnier), for Gloucester (Richard Graham) and for Cleethorpes (Martin Vickers), as well as from the hon. Member for Liverpool, Walton (Dan Carden). The right hon. Member for Birmingham, Hodge Hill (Liam Byrne), as Chair of the Business and Trade Committee, brought a critical eye to bear on aspects of the underlying agreement, on which I hope he has now been reassured. My hon. Friend the Member for Penrith and The Border (Dr Hudson) rightly championed the UK’s high food and animal welfare standards that the Government will continue to protect, and my right hon. Friend the Member for Chingford and Woodford Green (Sir Iain Duncan Smith) demonstrated his well-honed ability to probe legislation with regards to the future potential accessions of economies to the CPTPP. The Business and Trade Committee more broadly has my thanks for its engagement with, and scrutiny of, this important Bill.
This legislation will help to ensure that the UK meets its international obligations upon accession to the CPTPP. When the Bill achieves Royal Assent, it will mean that we have put the UK at the heart of a dynamic group of countries in the Indo-Pacific, providing new opportunities for British companies to sell more of their high-quality goods and services to a market of over 500 million people and a combined GDP of £9 trillion. With that in mind, and in the hope that it will therefore garner support from all hon. and right hon. Members, I am pleased to commend the Bill to the House.
Turkey Trade Negotiations
Kemi Badenoch Excerpts(1 month, 2 weeks ago)
Written StatementsRead Full debate Read Hansard Text Read Debate Ministerial Extracts
The Secretary of State for Business and Trade (Kemi Badenoch)
On Thursday 14 March 2024, the Department for Business and Trade launched negotiations for a new, upgraded free trade agreement with Turkey.
In line with our commitments to scrutiny and transparency, the Department for Business and Trade has published, and placed in the Library of both Houses, more information on these negotiations. This includes:
The United Kingdom’s strategic case for a UK-Turkey free trade agreement.
Our objectives for the negotiations.
A summary of the United Kingdom’s public consultation on trade with Turkey.
Scoping analysis, providing a preliminary economic assessment of the impact of the agreement.
The United Kingdom’s negotiating objectives for the upgraded agreement, published today, were informed by our call for input, which requested views from consumers, businesses and other interested stakeholders across the United Kingdom on their priorities for enhancing our existing trading relationship with Turkey.
These negotiations follow our signing of the UK-Turkey trade continuity agreement on 29 December 2020.
A new and enhanced trade agreement with Turkey is a key part of the United Kingdom’s strategy to secure advanced modern agreements with new international partners, and upgrade existing continuity agreements to better suit the UK economy.
The UK and Turkey are long-term strategic partners with deep economic links. Total trade in goods and services between the UK and Turkey was worth around £26 billion in 2022. Turkey is a dynamic economy with one of the fastest GDP growth rates among OECD members. An upgraded FTA with Turkey will aim to reduce and remove barriers in sectors of strategic importance to the UK such as services and digital trade, positioning British businesses advantageously for the opportunities of the future.
Our existing agreement, which forms the basis of our current trading relationship, is outdated and not designed for a digital age. While the existing agreement provides tariff-free access for 98.8% of UK goods exports by value to Turkey—based on 2021 figures—it contains only limited provision for the United Kingdom’s thriving services sector. We intend to change this by putting services at the heart of any new agreement, to benefit the UK economy. Upgrading our trade deal with Turkey will help to unlock a stronger, more advanced partnership. The new deal will play to our strengths, reflecting the realities of trading in the 21st century and allowing us to take advantage of future innovations.
Around 8,000 businesses from all parts of the United Kingdom exported goods to Turkey in 2022. Of those, 6,800 were small and medium-sized enterprises. The United Kingdom’s SMEs could be key winners from a new agreement with Turkey, as we seek to make it easier to do business and focus on trade barriers that may have deterred them from previously entering this exciting marketplace.
The Government are determined that any agreement must work for consumers, producers, investors and businesses alike. We remain committed to upholding our high environmental, labour, public health, food safety and animal welfare standards, alongside protecting the national health service. We will not negotiate a deal that undermines the UK’s points-based immigration system.
The Government will continue to update and engage with key stakeholders, including Parliament, the devolved Administrations and the Crown dependencies throughout our negotiations with Turkey.
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Oral Answers to Questions
Kemi Badenoch Excerpts(1 month, 3 weeks ago)
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Bob Blackman (Harrow East) (Con)
The Secretary of State for Business and Trade (Kemi Badenoch)
Israel remains a part of the FTA programme, and negotiations continue. I had a productive meeting with Israel’s Minister of Economy, Nir Barkat, last week in Abu Dhabi, where we discussed our existing trading relationship as well as how Israel is managing the challenges of working on an FTA while fighting a war.
Nicola Richards
Israel is facing immense challenges in its war with Hamas, but it is known around the world as a start-up nation thanks to its extraordinary tech sector, which Brits benefit from every day. Given the enormous opportunities that a bespoke free trade agreement with Israel offers to the UK, will my right hon. Friend update the House on what steps she is taking to advance negotiations?
Kemi Badenoch
My hon. Friend will be pleased to know that we held a virtual negotiating round with Israel in February, focused primarily on services. That is one of the things that we are doing to move the FTA forward, and we will update Parliament shortly in the usual way via a written ministerial statement.
My hon. Friend is right to highlight Israel’s world-leading tech sector, which is a reason why we want to modernise and upgrade our relations with Israel. Our current FTA was signed in 1995—it is a roll-over from the one we had with the EU—and technical collaboration, which Israel specialises in, will be made easier through an enhanced FTA.
Mr Alistair Carmichael (Orkney and Shetland) (LD)
Can the Secretary of State give me some assurance that any free trade agreement with Israel will not allow the importation of goods produced in settlements on the west bank?
Kemi Badenoch
Yes, I can give the right hon. Member that assurance. We are clear under our existing UK-Israel trade and partnership agreement that Israeli goods originating from the State of Israel receive tariff preferences. We also have a separate interim agreement between the UK and the Palestinian Authority. I confirm that that will continue to be the case with an upgraded FTA with Israel. We will not compromise our long-standing positions on the middle east process throughout this negotiation, including with respect to settlements.
Martin Vickers (Cleethorpes) (Con)
The Secretary of State for Business and Trade (Kemi Badenoch)
Since we left the EU, we have used our new freedoms to secure free trade deals with 73 countries, including EU partners, and that accounted for £1.1 trillion of UK trade in 2022. We have simplified import tariffs to lower costs for businesses and households. We plan to remove over 50% of inherited EU regulations by 2026. Our reforms to employment laws could save UK businesses up to £1 billion a year, ensuring that the UK is the best place in the world to start up and grow a business.
Martin Vickers
I thank my right hon. Friend for her reply. Measured by tonnage, the port of Immingham in my constituency is the largest port in the country, with almost 50 million tonnes of cargo each year. It is also a vital part of the renewable energy sector. Immingham is surely an example of the fact that not only EU trade but worldwide trade is important to the UK. If my right hon. Friend were able to visit at some time, she would be able to see that for herself.
Kemi Badenoch
As ever, my hon. Friend is a great advocate for his Cleethorpes constituency. He is right that Immingham is the No. 1 port in terms of tonnage and is vital to our trade with the EU and the rest of the world. If our diaries allow, I or one of my Ministers will be delighted to visit and see at first hand the vital role Immingham plays in the transition to renewable energy.
Kirsten Oswald (East Renfrewshire) (SNP)
In December, the British Chambers of Commerce found that a staggering 97% of surveyed businesses continued to face difficulties using the trade and co-operation agreement. Despite the TCA being introduced over three years ago, businesses are still struggling to deal with the added headache that the regulations have created. If 97% of businesses still face difficulties after three years, how many years is it anticipated that it will take for these issues to be resolved?
Kemi Badenoch
I thank the hon. Lady for her question. Many of the issues that businesses have been raising with us are specific not to the TCA but to member countries. That is why Ministers and I, along with officials, go to all these countries, and we have removed many of the market access barriers, which are not specific to the TCA. The hon. Lady will know that the TCA will be up for review. If she has specific things she would like us to take to EU Trade Commissioners, we are very happy to do so.
Mr Tanmanjeet Singh Dhesi (Slough) (Lab)
This week, the Financial Times reported the most significant decline in UK trade volumes since 1997. It is clearer than ever that this Government’s hard Brexit policy has exacerbated challenges for British businesses. With a 7.4% drop in trade since 2018 and exports down by 12.4%, we are starkly lagging behind our G7 peers. Can the Secretary of State explain how 14 years of Conservative rule have prepared British businesses for their despair around extra red tape and the chaos unleashed by this Tory hard Brexit policy?
Kemi Badenoch
I think the hon. Gentleman has just time-travelled from 2018 or 2019—it has been a long time since I have heard the phrase “hard Brexit”. He will of course know that we left the European Union with a deal, so he needs to catch up with what has actually happened. It is also interesting that he talked about an FT report from 1997; I should let him know that we have not been in government since 1997—we have been in government since 2010. Many of the things he is pointing out are things we have said will occur as trade flows move away from the European Union to the Indo-Pacific. That is why we have left; that is why we are trading with the rest of the world. The hon. Gentleman should also know that our economy is 80% services, so most of the things he is talking about will not impact on the vast majority of the economy. Services exports are booming, and we are doing well since leaving the EU.
Sir John Whittingdale (Maldon) (Con)
Grahame Morris (Easington) (Lab)
The Secretary of State for Business and Trade (Kemi Badenoch)
Last week, I travelled to Abu Dhabi for the 13th World Trade Organisation ministerial conference, where I met counterparts from many countries, including Australia, New Zealand, Canada and South Africa, along with trade representatives from the United States, European Union and the Gulf Co-operation Council. Alongside WTO members, we negotiated real outcomes for the UK and important agreements with our trading partners. We delivered for British business through the renewal of the e-commerce moratorium, a global agreement to avoid taxes on online transactions, from emails to movies and music. Building on the momentum from the 13th ministerial conference, we will continue to champion free, fair, open trade at every opportunity, recognising its potential to lower costs and increase prosperity, both here in the UK and around the world.
Grahame Morris
I thank the Minister for that statement.
We are no longer constrained by European competition law. The German Government are providing at least €6 billion in support for their steel industry. Given the very credible plan put forward by my union, Unite the union, to protect jobs and expand production at the steel plant at Port Talbot, why are the UK Government not investing more to create a viable future for our steel?
Kemi Badenoch
I am disappointed that the hon. Gentleman feels that we have not been investing as much as we should. What we have done in Port Talbot is the biggest investment that Government has ever made in steel. We are turning Port Talbot around; it is going to be regenerated. We are replacing high carbon emitting blast furnaces with electric arc furnaces to help reduce emissions, which his party and all of us across the House signed up to when we made the commitment to net zero. He may have specific things he thinks we can do on the transition, so I can tell him that we have a transition board to help those whose jobs are not going to be there with electric arc furnaces. However, we have done a significant amount for Port Talbot.
Sir John Whittingdale (Maldon) (Con)
Jonathan Reynolds (Stalybridge and Hyde) (Lab/Co-op)
Last month, the Secretary of State said at the Dispatch Box that she could state explicitly that trade talks with Canada had not broken down. However, the Canadian high commission has since contradicted that in writing, saying that neither negotiations nor technical discussions with respect to any of the outstanding issues have occurred since the UK unilaterally broke them off on 25 January. Mr Speaker, I just want to know who is telling the truth.
Kemi Badenoch
I am very happy to expand on what I said last time I was at the Dispatch Box on this topic. I repeat that our engagement with Canada on trade issues has been extensive across multiple Departments covering the free trade agreement, cheese quotas and rules of origin. On 25 January, the UK confirmed to Canada that we would pause FTA talks on the basis that cheese access had been removed and that Canada had signalled that rules of origin provisions would not be extended. That is how negotiations work.
I can tell the hon. Member that there was a meeting on 8 February between the Foreign Secretary and his Canadian counterpart where the cheese issue was discussed, and I raised cheese and rules of origin directly with the Canadians in Abu Dhabi last week. I must say to the hon. Member that chasing headlines based on things he has been told by the people with whom we are negotiating is not helpful to achieving the outcomes that our businesses, farmers and auto industry want to see.
Jonathan Reynolds
That was a lot of words for the Secretary of State to use to say that she believes the Canadian high commission was correct in the answer that it gave.
May I ask an important question about the proposed UK carbon border adjustment mechanism? Labour very much supports the introduction of a UK CBAM, but we are concerned that the Government will do so a year after the EU, resulting in the UK potentially being flooded with carbon-intensive products originally destined for Europe, including steel, cement and fertiliser. Do the Government recognise that danger? If they do, what is their plan?
Kemi Badenoch
Just on the first point, if the hon. Member still wants to believe Canada before the UK, that is his business, but we on the Conservative Benches know who we are working for, and we are working for British businesses.
On the hon. Member’s second point, carbon leakage is a global problem facing all countries that are ambitious in tackling climate change, and we are working with international partners on how we tackle it together. We are following developments on the EU CBAM closely, and we are engaging with the European Commission to discuss technical considerations relevant to UK manufacturers. We share its concerns on carbon leakage, but we need to make sure that the UK response, whatever it is, is tailored to what the UK needs, not just a copying and pasting of what others are doing.
Mr Philip Hollobone (Kettering) (Con)
Kemi Badenoch
I commend the Ball Corporation in Burton Latimer for all it is doing. I also thank my hon. Friend for what he is doing to promote inward investment, which supported more than 2,800 jobs across the east midlands in 2023. He has spoken to me before about the importance of the Ball Corporation to Kettering, and I am happy to confirm that either myself or one of my Ministers would be delighted to visit when diaries allow.
Richard Thomson (Gordon) (SNP)
While the UK Government struggle to support small and medium-sized enterprises exporting to Europe, they are providing a £600 million export guarantee to INEOS so that it can build the largest chemical plant in Europe for 30 years in Antwerp, Belgium. Why can the UK Government find £600 million to support that investment, but not match the £500 million that the Scottish Government are investing in domestic energy transition at home?
Kemi Badenoch
UK Export Finance does not give the money; it provides guarantees to loans that are being provided by banks. There is quite a significant distinction: we have not given that money; we have guaranteed a loan. The reason why we provide those guarantees is that they guarantee jobs to British businesses. There is a big difference between a loan guarantee and giving money. If he would like more of an explanation on that, we are happy to provide one to him.
Andrew Rosindell (Romford) (Con)
Marsha De Cordova (Battersea) (Lab)
Kemi Badenoch
The hon. Lady raises a significant issue around ensuring that disabled people are able to access employment and are paid properly. We have no plans to introduce mandatory disability pay gap reporting—no plans to introduce disability pay gap reporting at all. Unlike gender pay gap reporting, which is very simple, binary and easy to execute, disability pay gap reporting, like ethnicity pay gap reporting, is very complex. There are a range of disabilities that could not be easily monitored, so I would like to work with her on other areas where we can help to improve the lives of disabled people at work. We do not believe that disability pay gap reporting is the answer.
Greg Smith (Buckingham) (Con)
Kemi Badenoch
My hon. Friend is right. Israel’s current relationship with the UK is worth about £6.4 billion, but our FTA is a roll-over of the one that Israel signed in 1995 with the EU. It does not take into account services, digital, artificial intelligence or genome sequencing. There is a lot that we can do. That is why we are working on this FTA. It is a priority for us. As I said earlier, we face many challenges in carrying on negotiations with a country that is at war, but we are working to overcome them.
Munira Wilson (Twickenham) (LD)
Mr Laurence Robertson (Tewkesbury) (Con)
Kemi Badenoch
My hon. Friend is right. I signed the enhanced trade and investment partnership in Nigeria, alongside my counterpart, Dr Doris Uzoka-Anite, on Tuesday 13 February this year. It was the first of its kind in terms of the UK’s trade commitments across the region. The partnership aims to remove market access barriers and promote technical co-operation in areas such as financial and professional services. The UK and Nigeria have co-created a partnership that tackles issues that businesses face, and this is the first step in a significant relationship and an already strong trading partnership worth a total of £6.7 billion in the 12 months to September.
Liz Twist (Blaydon) (Lab)
Mr Barry Sheerman (Huddersfield) (Lab/Co-op)
When will the Secretary of State wake up to the huge potential of universities to tackle all the problems in society, including climate change? Will she come to Huddersfield, which has one of the best universities in the country? It is working with local businesses to make the future safe for our country.
Kemi Badenoch
If the hon. Gentleman sent a proposal to my office about what we could do on a visit to the University of Huddersfield, I would be very keen to take a look. We support our universities. If he has a specific business and trade angle in mind, we will see what we can do, if diaries allow.
Richard Foord (Tiverton and Honiton) (LD)
Mr Hussein from east Devon, whom I represent, has effectively been robbed of £100,000, given that £40,000 of sub-standard building work has to be levelled and destroyed. The Federation of Master Builders has campaigned for a compulsory licence scheme for construction companies. The Domestic Buildings Works (Consumer Protection) Bill would outlaw cowboy builders, provide compensation for consumers and ensure that reputable builders were not undercut by unlicensed rogues. Will the Minister take a fresh look at that Bill?
Kirsten Oswald (East Renfrewshire) (SNP)
Goldman Sachs has found that Brexit Britain has significantly underperformed compared with other advanced economies; the result is that UK GDP is 5% lower than it would have been had we not left the European Union. Does the Secretary of State appreciate that best way to grow the economy, boost business confidence and reduce trade barriers is to rejoin to the EU?
Kemi Badenoch
I recommend to the hon. Lady the report produced by my Department on 31 January about the benefits of Brexit. It explains exactly what is happening with the UK economy. Claiming that GDP would have been 5% higher when we are outperforming our G7 partners is simply not credible. She wants to take us back to square one, but that is exactly the reason why people need to stick with the Conservative plan.
Jim Shannon (Strangford) (DUP)
I am very encouraged by the Secretary of State’s comments about the free trade deal with Israel. The UK is a friend of Israel, and Israel is a friend of the UK, so what more can we do to increase trade between us? More importantly—and very regionally —how can the Secretary of State ensure that Northern Ireland is very much part of that trade deal, so that companies in Strangford and across Northern Ireland also feel the benefit?
Kemi Badenoch
The hon. Gentleman will remember that we had the Northern Ireland investment summit, at which we talked about bringing more investment into Northern Ireland. He will know that around 500 Israeli firms operate in the United Kingdom. That investment from overseas is creating thousands of jobs in high-value sectors, and a free trade agreement will help to increase the investment. That will benefit businesses in Northern Ireland, too.
World Trade Organisation Ministerial Conference
Kemi Badenoch Excerpts(1 month, 3 weeks ago)
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The Secretary of State for Business and Trade (Kemi Badenoch)
Last week, I attended the World Trade Organisation’s 13th ministerial conference MC13—in Abu Dhabi with the Minister of State for Trade Policy, my right hon. Friend, the Member for Chelsea and Fulham (Greg Hands).
MC13 saw the world’s Trade Ministers come together to discuss the most pressing challenges facing global trade and agree a way forward.
The WTO members agreed several outcomes, including:
extending the moratorium on customs duties on electronic transmissions, which protects tariff-free digital trade, thereby maintaining lower costs and predictability for business engaging in digital trade;
re-committing to find a solution to restore the dispute settlement impasse, which is necessary to uphold global rules of free, fair and open trade and to ensure that every member of the WTO has access to a system to protect their trading interests against the unfair practices of other members;
extending the moratorium on TRIPS—trade-related aspects of intellectual property rights—non-violation and situation complaints;
a small package of outcomes on development, including easing the transition for countries graduating from “least developed country” to “developed country”, such as Angola and Bangladesh;
the Abu Dhabi ministerial declaration, which emphasises the importance of work on a range of important areas, including WTO reform, women’s economic empowerment, services trade and supporting micro, small, and medium enterprises.
MC13 also celebrated the accession of two new members to the WTO—Comoros and Timor-Leste—which will bring the total number of WTO members to 166 and help developing countries reap the benefits of free trade.
At the conference, we celebrated the entry into force of new disciplines under the Services Domestic Regulation Joint Initiative, which could lead to global savings of £99 billion through facilitating trade in services.
The UK is also pleased to have completed the investment facilitation for development agreement, which commits its 127 signatories to practical steps to make it easier to invest in developing countries. This means UK investors should benefit from reduced transaction costs in low-income countries under this agreement, which could increase stocks of outward UK FDI by £2.5 billion in participating members. The agreement will also cut red tape, providing a one-stop shop for investors to communicate with Government, and the creation of a single website that investors can go to for information.
The UK remains committed to the rules-based multilateral trading system as vital to the economic prosperity and trading stability of all the WTO’s 166 members. MC13 did not deliver on all of the UK’s objectives and was a stark reminder of the challenge of agreeing change on the consensus basis of the WTO. However, the WTO remains a critical, albeit imperfect, part of the global trading system that helps deliver global economic growth.
MC13 was also a great opportunity to meet with my international counterparts, including the Gulf Co-operation Council, the United States Trade Representative and the EU Executive Vice-President to progress MC13 negotiations, the New Zealand and Australian Trade Ministers to discuss implementation of the UK’s free trade agreements, and the Canadian Trade Minister to discuss bilateral trade relations, including rules of origin.
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Post Office Governance and Horizon Compensation Schemes
Kemi Badenoch Excerpts(2 months, 1 week ago)
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The Secretary of State for Business and Trade (Kemi Badenoch)
With permission, Mr Speaker, I shall make a statement about Post Office governance and the Horizon compensation schemes.
Over the weekend, several serious allegations were made against the Government, my Department and its officials by Henry Staunton, the former chair of the Post Office. The allegations are completely false, and I would like to make a statement to the House so that hon. Members and the British public know the truth about exactly what has happened. I would like to address three specific claims that Mr Staunton made in his Sunday Times interview—claims that are patently untrue.
First, Mr Staunton alleges that I refused to apologise to him after he learned of his dismissal from Sky News. That was not the case. In the call he referenced, I made it abundantly clear that I disapproved of the media breaking any aspect of the story. Out of respect for Henry Staunton’s reputation, I went to great pains to make my concerns about his conduct private. In fact, in my interviews with the press, I repeatedly said that I refuse to carry out HR in public. That is why it is so disappointing that he has chosen to spread a series of falsehoods, provide made-up anecdotes to journalists and leak discussions held in confidence. All that merely confirms in my mind that I made the correct decision in dismissing him.
Secondly, Mr Staunton claims that I told him that “someone’s got to take the rap” for the Horizon scandal, and that was the reason for his dismissal. That was not the reason at all. I dismissed him because there were serious concerns about his behaviour as chair, including those raised by other directors on the board. My Department found significant governance issues. For example, a public appointment process was under way for a new senior independent director to the Post Office board, but Mr Staunton apparently wanted to bypass it and appoint someone from the board without due process. He failed to properly consult the Post Office board on the proposal; he failed to hold the required nominations committee; and, most importantly, he failed to consult the Government, as a shareholder, which the company was required to do. I know that hon. Members will agree with me that such a cavalier approach to governance was the last thing we needed in the Post Office, given its historical failings.
I should also inform the House that while Mr Staunton was in post, a formal investigation was launched into allegations made regarding his conduct, including serious matters such as bullying. Concerns were brought to my Department’s attention about Mr Staunton’s willingness to co-operate with that investigation.
It is right that the British public should know the facts behind the case, and what was said in the phone call in which I dismissed Mr Staunton. Officials from my Department were on the line; the call was minuted, and a read-out was sent after it took place. Today, I am depositing a copy of that read-out in both Libraries of the House, so that hon. Members and the public can see the truth. In those minutes, personal information relating to other Post Office employees has been redacted. For all those reasons, an interim chair will be appointed shortly, and I will, of course, update the House when we have further details.
Finally, Mr Staunton claims that when he was first appointed as chair of the Post Office, he was told by a senior civil servant to stall on paying compensation. There is no evidence whatsoever that that is true. In fact, on becoming Post Office chair, Mr Staunton received a letter from the permanent secretary of the Department for Business, Energy and Industrial Strategy, Sarah Munby, on 9 December 2022, welcoming him to his role and making it crystal clear that successfully reaching settlements with victims of the Post Office scandal should be one of his highest priorities. That letter is in the public domain. The words are there in black and white, and copies of the correspondence will be placed in the Libraries of both Houses.
The reality is that my Department has done everything it can to speed up compensation payments for victims. We have already made payments totalling £160 million across all three compensation schemes. That includes our announcement last autumn of the optional £600,000 fixed-sum award for those who had been wrongfully convicted. It is the strongest refutation of those in this House who would claim that we acted only after the ITV drama, “Mr Bates vs The Post Office”, was shown. British people should know that a dedicated team of Ministers and civil servants have been working around the clock for many months to hasten the pursuit of justice, and bring swift, fair redress to all those affected.
To that end, I am pleased that all 2,417 postmasters who claimed through the original Horizon shortfall scheme have now had offers of compensation. The Post Office is dealing promptly with late applications and cases where the initial offer has not been accepted. My Department has also established the Horizon compensation unit to ensure that money gets to the right people without a moment’s delay. Last autumn, we announced an additional £150 million to the Post Office, specifically to help it meet the costs of participating in the Post Office-Horizon inquiry and delivering compensation to postmasters. In all, we have committed around £1 billion to ensure that wronged postmasters can be fully and fairly compensated, and through forthcoming legislation, we are taking unprecedented steps to quash the convictions of postmasters affected by the Horizon scandal.
In short, we are putting our money where our mouth is, and our shoulders to the wheel to ensure that justice is done. It is not fair on the victims of this scandal, which has already ruined so many lives and livelihoods, to claim, as Mr Staunton has done, that things are being dragged out a second longer than they ought to be. For Henry Staunton to suggest otherwise, for whatever personal motives, is a disgrace, and it risks damaging confidence in the compensation schemes that Ministers and civil servants are working so hard to deliver. I would hope that most people reading the interview in yesterday’s Sunday Times would see it for what it was: a blatant attempt to seek revenge following dismissal.
I must say that I regret the way in which these events have unfolded. We did everything that we could to manage this dismissal in a dignified way for Mr Staunton and others. However, I will not hesitate to defend myself and, more importantly, my officials, who cannot respond directly to these baseless attacks. Right now, the Post Office’s No. 1 priority must be delivering compensation to postmasters who have not already been compensated. There were those who fell victim to a faulty IT system that the Post Office implemented, and that it turned a blind eye to when brave whistleblowers such as Alan Bates sounded the alarm. We said that the Government would leave no stone unturned in uncovering the truth behind the Horizon scandal, and in pursuing justice for the victims and their families. We are delivering on that promise, while looking for any further possible steps that we can take to ensure the full and final settlement of claims as quickly as possible.
It is right that we reflect, too, on the cultural practices at the Post Office that allowed the Horizon scandal to happen in the first place. It was a culture that let those in the highest ranks of the organisation arbitrarily dismiss the very real concerns of the sub-postmasters who are the lifeblood of their business and pillars of the local community. Although the Post Office may have failed to stand by its postmasters in the past, we are ensuring that it does everything that it can to champion them today, and to foster an environment that respects their employees and their customers. That is how we will rebuild trust and ensure that the British public can have confidence in our Post Office, now and in the future. I commend this statement to the House.
Jonathan Reynolds (Stalybridge and Hyde) (Lab/Co-op)
I firmly agree that the revelations in The Sunday Times at the weekend could not be more serious. In particular, if true, the claim that the Post Office was instructed to deliberately go slow on compensation payments to sub-postmasters in order to push the financial liability into the next Parliament would be a further outrageous insult in a scandal that has already rocked faith in the fairness of the British state. If that is the case, it cannot be allowed to stand, and if it is not, it must be shown to be false in no uncertain terms. We have two completely contrasting accounts: one from the former chair of the Post Office, and one from the Secretary of State. Only one of them can be the truth. I hope that we are all in agreement that Parliament is the correct place for these matters to be raised and clarified. What we need now is transparency and scrutiny.
Will the Secretary of State categorically state that the Post Office was at no point told to delay compensation payments by either an official or a Minister from any Government Department, and that at no point was it suggested that a delay would be of benefit to the Treasury? Will there be a Cabinet Office investigation to ensure that no such instruction or inference was given at any point? Crucially, is the £1 billion figure for compensation, which the Secretary of State helpfully just repeated, already allocated, and sat in the accounts of the Department for Business and Trade, ready to be paid? If it is not, will compensation payments be specifically itemised in the upcoming Budget?
The Secretary of State will also understand that following the story at the weekend, victims of other scandals—especially of the contaminated blood scandal—feel that they need to ask whether they have been the victims of deliberate inaction. Will the Government provide assurances that no such obstruction has been placed on any payments of this kind? If so, can they explain what the delay is in some cases? In the full interests of transparency, and to fully ascertain the veracity of any allegations for sub-postmasters and the general public, will she publish all relevant correspondence, and minutes of meetings between the Department, the Treasury, UK Government Investments and the Post Office during this time? Finally, when can we expect the legislation on exoneration that was promised by the Prime Minister?
I cannot stress enough that the last thing that was needed in this scandal was any further allegation of cover-up or obfuscation at the very top of Government. People’s faith in Government, already damaged by scandals such as Hillsborough, Bloody Sunday and Windrush, is hanging by a thread. This miscarriage of justice has shown the devastation that can occur when institutions are allowed to operate without oversight or are shrouded in secrecy. We should all agree that that secrecy must end, and that the full sunlight of public scrutiny should be brought to bear. If everything the Secretary of State has told us today is correct, surely there will be no objection to that happening fully.
Kemi Badenoch
I welcome the tone that the shadow Front-Bench spokesman has taken. There is often a tendency for political point scoring, but I think we both agree that this is very much about the postmasters. That is why I ensured that I was at the Dispatch Box: so that people would know the truth. That is what builds trust.
The shadow Minister asked whether I would categorically state that no instruction was given to delay payments. Yes, I can. We have no evidence whatever that any official said that. If such a thing was said, it is for Mr Staunton to bring the evidence. It is very hard to refute a negative. People making wild, baseless accusations and then demanding proof that they did not happen are making mischief, in my view. As far as I have seen, all the evidence points to the fact that no one gave that instruction.
It is also important to look at whether it would even make sense to do so. There would be no benefit whatever to our delaying the compensation, which has no significant impact on revenues. It would be a mad thing even to suggest. The compensation scheme, which Mr Staunton oversaw, has been completed. My understanding is that 100% of payments have been made, so clearly no such instruction was given. The hon. Gentleman mentioned the infected blood inquiry. This is a good example of how people lose faith in the system because of misinformation. That is why I am here to correct the record.
The hon. Gentleman asked about the £1 billion allocation. We give monthly reports that show exactly what payments are being made. He also asked whether we will publish correspondence. No, we will not publish in full all correspondence between Departments, UKGI and the Post Office. That is because we set up the statutory inquiry, which will examine the important issues related to the Horizon scandal, as well as current governance arrangements. We are fully co-operating with the inquiry, but the inquiry was set up by Parliament specifically to look at that. In addition to the read-out of the true content of my telephone call with Mr Staunton, we will consider publishing correspondence between Departments and Mr Staunton in accordance with freedom of information rules, so that people will know exactly what happened, contrary to his account. The hon. Gentleman asked about legislation. That is something that we are actively working on. I expect that we will be able to deliver on that imminently.
Paul Scully (Sutton and Cheam) (Con)
When I was the postal affairs Minister, the officials in my team not only shared my drive to get the money out of the door—life-changing money for postmasters—but were energised and empowered to do so. I cannot believe for a minute that just a few months later they would be doing and thinking the polar opposite. Clearly, they cannot defend themselves in public, so will my right hon. Friend confirm that conversations about colluding to slow down the compensation did not happen? It is important that we double down and get more money out of the door as soon as possible.
Kemi Badenoch
I pay tribute to my hon. Friend for all his fantastic work as the postal affairs Minister, and I can confirm that. My officials have looked through all the correspondence, and all the minutes of the conversations that Mr Staunton had with the Department. They found absolutely nothing, and he did not raise the matter in his call with me. If it were something that officials had said to him, surely he would have mentioned it to Ministers—either myself or the postal affairs Minister, my hon. Friend the Member for Thirsk and Malton (Kevin Hollinrake). The fact that Mr Staunton did not do so shows that it is quite likely something that he is making up.
Marion Fellows (Motherwell and Wishaw) (SNP)
I am at a loss today: another Monday, another Post Office scandal. I have tried very hard to pull together my thoughts on the statement, what was said in The Sunday Times, and what was said in this place less than two weeks ago when I led a Backbench Business debate on the culture of Post Office management.
I will ask the Secretary of State a few questions. Will she place on the record whether Nick Read wrote to the Justice Secretary last month defending the convictions, saying that some postmasters were guilty? That is a serious allegation, and I would really like to have an answer.
There has been talk all morning about damaging confidence in the compensation schemes. If there is confidence in them, can the Secretary of State explain why so many leading sub-postmasters affected by the scandal were given such derisory offers, months and months late? That is just not on. The Secretary of State cannot say that Henry Staunton damaged the compensation schemes; it was down to the Government and Post Office Ltd.
Is the Secretary of State aware that Post Office Ltd still employs 40 investigators who secured convictions? I agree with what the hon. Member for Stalybridge and Hyde (Jonathan Reynolds) said: exoneration must be hurried up and compensation must be paid sooner rather than later. I have said that every month for the last nine months.
Kemi Badenoch
The hon. Lady asks multiple questions. The first is about a letter written by Nick Read, Post Office’s chief executive, to the Justice Secretary. What I can say is that UKGI and Post Office Ltd have both vehemently denied that Nick Read was put under any pressure to write the letter she refers to.
On the risks of making a decision on blanket exoneration, the postal affairs Minister, my hon. Friend the Member for Thirsk and Malton (Kevin Hollinrake), has said repeatedly that we have been faced with a dilemma: either to accept the present problem of many people carrying the unjustified slur of conviction, or to accept that an unknown number of people who have genuinely stolen from their post offices will be exonerated and perhaps even compensated. That is the case, and it is certainly what the Government believe. What she says about people being put under pressure to write a letter is something that UKGI and Post Office Ltd have both vehemently denied.
The hon. Lady repeats Mr Staunton’s allegations, but I have already given a statement saying that they are completely false. She asks about individual cases of people who have been paid. I cannot comment on individual cases, but I would like to clarify that the main scheme in place under Henry Staunton’s watch was the Horizon shortfall scheme. Some 2,417 people were made offers within the original deadline. One hundred per cent have received offers, but 84% have accepted offers. I just wanted to clarify my previous comments.
On the 40 prosecutors still working for Post Office, I have had multiple people giving different bits of information. The inquiry is looking at that and will get to the bottom of it.
John Redwood (Wokingham) (Con)
Will the Secretary of State review the governance of UKGI? How did it manage to preside over the Post Office with its dreadful treatment of sub-postmasters? How did UKGI allow senior Post Office managers to rack up and accumulate losses of £1,390 million, effectively bankrupting the Post Office so that it can now trade only if it has the reassurance of massive cash infusions from the Treasury on a continuing basis? Surely this body has done very badly, and we need a better answer.
Kemi Badenoch
That is one of the reasons why we have been making personnel changes in this area. It goes back to the point I was making in the statement: Post Office needs an effective chair. Until the day I had the conversation dismissing him, I never had any correspondence from Mr Staunton about difficulties that he was having with UKGI. If he was having difficulties, he should have told me, rather than give an interview to The Sunday Times effectively stating that he had no control over the organisation that he had been appointed to run.
Mr Kevan Jones (North Durham) (Lab)
The Secretary of State says we have to accept that Henry Staunton’s accusations are completely false. The letter that Nick Read wrote to the Lord Chancellor about overturning convictions mentioned that about 300 people are possibly going to be “guilty”. She has just told the House that the investment body did not instruct him to do that. Henry Staunton said he did not tell Post Office to write the letter, and the board did not know about it, so who did? For the sake of openness and transparency, she should produce all correspondence between UKGI and Post Office. The Secretary of State has accused Henry Staunton of lying in public. The only way we can judge whether she is telling the truth is if we have all the information out there.
Can I just say to the Secretary of State, in relation to her obsession with tweeting, that although she says that people are jumping “on the bandwagon”, some of us have been involved in this for many years on a cross-party basis, including through work with her colleague the Under-Secretary of State for Business and Trade, the hon. Member for Thirsk and Malton (Kevin Hollinrake), so that is quite insulting. What message will the Secretary of State’s tone today send to sub-postmasters? I will tell her: more cover-up and obfuscation. Get the information out there and explain what is going on. Otherwise, she will not have their trust. It will just be more of the same that we have seen over many, many years.
Kemi Badenoch
I completely reject the right hon. Gentleman’s assertions. This is the political point scoring that I talked about earlier, which we just need to stop. Rather than focusing on the issue, he is talking about my tweeting. Maybe he should get off Twitter and actually listen to what I am saying at the Dispatch Box. He is talking about a letter that UKGI says it did not ask Nick Read to write. The only possible answer is that Nick Read himself decided to write that letter. I did not ask him to write it, the Post Office says that it did not, and UKGI did not. These are the sorts of things I am talking about—continuing to make aspersions about Ministers. We have made the Post Office an independent body, we have an independent inquiry, and the information will come out in due course.
Sir Conor Burns (Bournemouth West) (Con)
There is no doubt that there was a bad culture in the Post Office for a very long time. It misled a significant number of Ministers, who, to put it gently, could have been more inquiring over the years. Has my right hon. Friend had time to reflect on the words of the non-executive members of the board representing the postmasters, who say that only days before she sacked the chairman, there was still a culture in which they were viewed as guilty and on the take? If that sacking has brought compensation to those people, who were traumatised and misled by the Post Office, and who had their lives destroyed, her decision will go down as a very welcome one.
Kemi Badenoch
I agree with my right hon. Friend. The comments by the members of the board who are former postmasters are very interesting. They are saying exactly what I am saying: that Henry Staunton was not doing a good job as Post Office chair. That leads me back to the point made by the right hon. Member for North Durham (Mr Jones), who is more interested in attacking the Government than in looking at what even the members of the board are saying. It is important that we continue to give confidence to people that those organisations are run properly. That was the reason for the dismissal.
Mr Alistair Carmichael (Orkney and Shetland) (LD)
Having supported constituents in negotiations in relation to the historical shortfall scheme, I can tell the Secretary of State that, whatever the reason for it, the conduct of the Post Office and its agents was characterised by delay and obstruction. That, in turn, led to the view taking hold among sub-postmasters that there was no point in making claims. Since the ITV drama aired, I have heard of several constituents making belated claims. What more are the Government doing to ensure that everybody out there who may have a claim is able to receive compensation?
Kemi Badenoch
The right hon. Gentleman’s question is a good one. The fixed-sum awards show that we are taking the matter very seriously. I became Business Secretary in February last year, and my one priority was to ensure that people got their compensation as quickly as possible. I did everything that I possibly could, with the Minister with responsibility for the Post Office, my hon. Friend the Member for Thirsk and Malton (Kevin Hollinrake), whom I thank for his tireless efforts. He had been looking at the portfolio before I got the job as Business Secretary, and I knew that the work was in safe hands. We have worked together as a team, fought cross-departmentally to ensure that people got the compensation that they deserved, and brought in legislation just before December—well before the ITV drama. The cases that the right hon. Gentleman raises are important, as they show that there is still a lot of work to do, and we will continue doing it.
Duncan Baker (North Norfolk) (Con)
Given the Post Office’s track record with accuracy, I am very glad that we have heard from the Secretary of State—I would rather take her assurances at the Dispatch Box than anything from a disgruntled, sacked former employee of the Post Office. Even during last week’s recess, I still had constituents coming to me saying that they were affected by the Horizon scandal, so can the Secretary of State assure the people watching that the process is very quick and simple? People who still feel that they lost money during that horrendous period need to keep coming forward, because there is an easy process: they can fill in a form to make sure their voice is heard and that they get compensation.
Kemi Badenoch
My hon. Friend is quite right. I thank him for raising this issue, and also for the work he has done—as a former postmaster, he knows quite a lot about what has been going on. I reassure all of the people who have been affected by this scandal that it is something we take very seriously. When I became Business Secretary, I was absolutely horrified by the sheer scale of trauma that people had been going through. We want people to continue coming forwards; where they are not happy with the process, we will look at it again, but there is a formal process in place to ensure that all postmasters can be treated fairly, equally and equitably.
Dame Diana Johnson (Kingston upon Hull North) (Lab)
The allegations of limping towards the general election in relation to delaying compensation payments to postmasters mirror the Government’s behaviour towards the infected blood scandal. They have had the final recommendations for that compensation since April 2023, with no action having been taken, so it seems to me that there is a pattern of behaviour: the Government act only when they are forced or shamed into doing so. With the infected blood scandal, we have been told repeatedly by Ministers that the Government are working at pace. What that really means is that they are limping at pace, are they not?
Kemi Badenoch
No, no, and no. It is a shame that the right hon. Lady stands up in the Chamber and says that the Government acted only when we were forced to do so, because she knows that we brought legislation to this House well before the ITV drama. She knows about the Horizon shortfall scheme, the group litigation order payments and the overturned convictions. She is trying to mix this issue up with the infected blood inquiry, knowing that I have just proved that the allegations made by Mr Staunton are completely false. I have said that minutes will be put on the record showing that this is not an issue that Labour wants to look at beyond political point scoring. I will not stand at this Dispatch Box and allow that to happen.
Miss Sarah Dines (Derbyshire Dales) (Con)
At the weekend, leaks to newspapers appeared to show really poor embedded practices at the Post Office board, using language about our postmasters being “on the take” or “guilty”. What is my right hon. Friend doing to clean up the act?
Kemi Badenoch
My hon. Friend makes a very good point. That is why we need effective leadership at the Post Office; and it is why I took the decision to dismiss Mr Staunton, among the other issues I have covered in this statement. We need people who care, and one of the things that worries me is that because Mr Staunton has decided to have revenge in the papers, it is going to be even harder for us to find people who will come in and do this very difficult job. I hope they will not be put off by the misinformation that has been in the papers.
Andrew Bridgen (North West Leicestershire) (Ind)
I thank the Secretary of State for her prompt statement, and for laying out her version of events about the dismissal of Mr Staunton, the Post Office chairman. We have to accept her statements from the Dispatch Box, but I take exception to one point she made. She said that there was no evidence of stalling on compensation, but that evidence comes from the experience of my own constituents, Mr and Mrs Rudkin—their evidence to me was fundamental in unravelling this whole Post Office Horizon scandal. Susan Rudkin’s criminal conviction was overturned in December 2020—she was one of the first nine. When I spoke to Mr and Mrs Rudkin only a few weeks ago, over three years after that conviction was overturned, they still had not received their compensation. If that is not evidence of stalling, what is?
Kemi Badenoch
I cannot comment on that specific case, because I do not have the details, but a fixed sum award is available should Mr and Mrs Rudkin wish to take it. There is a process and we will move as quickly as we can. I cannot speak specifically about why there has been that delay, but we are doing everything we can to get the money out to the postmasters as quickly as possible.
Richard Drax (South Dorset) (Con)
I have a once-proud former postmaster in my constituency, who ran the post office in Swanage. He fell foul of this scandal and was sacked, not prosecuted. His life was utterly ruined and he repaid the money that was owed. That was many years ago, but his wife is now very ill and he has still not had compensation. May I make two points? First, his lawyer tells me that the compensation scheme is taking too long. Secondly, may I ask the Secretary of State for an assurance that he will not be brushed off financially simply because he was not prosecuted? The lives of this man and his wife have been utterly ruined.
Kemi Badenoch
I know exactly the sort of people my hon. Friend is talking about, and it is really awful to hear about everything they have been through. I have a constituent who has talked to me about how this scandal has ruined her life. We owe it to them to do everything we can to ensure that they are fully compensated, and I can assure him that Ministers and officials are working on this every day. I know it is not always as quick as people would like, but we want to ensure that it is done properly and that there are no issues following that. I do not have the specific details of that case, but they can apply to the Horizon shortfall scheme, and if my hon. Friend brings it to the attention of the postal affairs Minister, we will look at it specifically.
Kate Osborne (Jarrow) (Lab)
Ministers have promised that the Government will bring in a new law to swiftly exonerate and compensate victims, so can the Secretary of State tell me why my constituent Chris Head has been offered only 13% of his compensation claim? How can sub-postmasters trust the Government or the Post Office to deliver full and fair compensation when they are still facing so much pushback on their compensation claims and receiving offers that go nowhere near financial restoration, let alone compensation for the injustice? Can I quickly add that the Secretary of State’s suggestion that the Government would have acted in the same way had the ITV drama not been shown is thought to be completely unbelievable by most, and none more so than by the sub-postmasters themselves?
Kemi Badenoch
The fact is that when we took the legislation through the House in December, the Opposition Benches were empty. Opposition Members are the ones who decided to take a more keen interest after the drama; we have been working flat out. I do not have the specific details of her constituent’s case, as she knows, but I will continue to repeat what I have said, which is that where people have not received compensation, we can look at that. There is a process, and there is also an independent panel they can appeal to, but the vast majority of people who have been getting offers are taking them.
Brendan Clarke-Smith (Bassetlaw) (Con)
Too often, quango bosses are rewarded for failure and can walk away with big payouts, and it would be a disgrace for the man who has done so little to get compensation for postmasters to get any himself. Can the Secretary of State confirm that she will block any such payments?
Sammy Wilson (East Antrim) (DUP)
I think the public squabble at the weekend further undermines people’s confidence in what is going to happen and in the Government’s assurances about compensating the people affected by the Post Office scandal. I tend to believe the view of the Secretary of State, simply because the record of Post Office officials trying to cover up, pass the buck and cause confusion is on the record, and we know what they are doing. However, the fact remains that there are still people who have not had any offer of compensation, there is still £1 billion that has not been spent in compensation, and there are still people whose cases have not even been considered. Is not the best way of answering Henry Staunton for the Government to get on with the job and ensure that compensation is paid quickly, and for people to get the compensation they deserve?
Kemi Badenoch
The right hon. Gentleman is quite right. As I said earlier, 64% of people have received compensation, and we want to get that to 100% as quickly as possible. However, we want to ensure that people get the right amount and are compensated fairly, and that is why we have the process, including a point of appeal if they are unhappy with the offer.
The point the right hon. Gentleman made right at the beginning of his question is correct. The points made in the newspapers do undermine the work that we are doing. It was very disappointing to read those statements. It was also disappointing because I had done everything I could to try and keep this out of the news and do it behind closed doors, properly. I made sure when I gave public statements that I said I would not do HR in public. When I found out that it had been leaked to Sky News, I even called Sky News and asked—one of my assistants asked—for that not to be put out in the public domain before I had had a chance to speak to Henry Staunton. I did the same with the Daily Mail, which thankfully did listen. We also need the media to help us in this and not publish false allegations.
Lee Anderson (Ashfield) (Con)
I am absolutely staggered that the Labour party now seems to be coming out in support of the disgraced Post Office management team—the same management team that oversaw the wrongful imprisonment of postmasters across the country, with hundreds of convictions. Does my right hon. Friend agree that, when push comes to shove, that lot over there would take the side of the grifters, not the grafters?
Kemi Badenoch
As my hon. Friend says, the Post Office leadership oversaw wrongful convictions. That is one of the reasons why we have had multiple changes, and this is just the latest to ensure that we get the right leadership in place. [Interruption.] I know that some Opposition Members are dealing with this properly, but we can see from the heckling that many of them came here thinking that they could score political points, and I am not allowing that to happen.
Sir Chris Bryant (Rhondda) (Lab)
Many Members are of course angry and impatient about trying to get compensation and exoneration for all of the postmasters as soon as possible. If we are all honest, we as a whole Parliament should have been much more impatient much earlier. There are some rare exceptions to that, including my right hon. Friend the Member for North Durham (Mr Jones), who spoke earlier, and obviously Members on the Government side of the House as well. May I just clarify something about the process of Mr Staunton’s dismissal? As I understand it, he found out about it from Sky News. I think the Secretary of State just added a piece of information, which is that she then rang Sky News, before ringing him I think, to try and get them to stop running it. So she knew that this had already been leaked to Sky News, presumably from somebody in her Department. What investigation did she go through to find out who leaked it, and is that person still in post, because otherwise one might just worry that it might have been she herself who leaked it?
Kemi Badenoch
I knew that someone would ask that question. I in fact have evidence to show that I asked Sky News not to run the story. Of course I did not leak it—because if I had, that would have created legal risk if Mr Staunton had found out on the news before I had had a chance to speak to him. We have no idea how Sky News found out the information—several thousand people work in the Department for Business and Trade, and many more work at the Post Office and UK Government Investments. [Interruption.] The hon. Member for Rhondda (Sir Chris Bryant) is heckling, but the point I am making is that leaks are incredibly damaging and harmful; they create legal risk for the Department. I did not do so; I made multiple efforts with at least two media outlets to make sure that they did not create problems for Mr Staunton, and it is one of the reasons why it was very disappointing to see what he did in The Sunday Times at the weekend.
Debbie Abrahams (Oldham East and Saddleworth) (Lab)
To be honest, I am afraid I do not think that the Business Secretary and her statement have helped us to get closer to the truth in this situation; it is a question of the Secretary of State’s version of events and the former chairman’s version of events. For clarity, and to try to draw a line under this and get to the truth, is the Secretary of State willing to refer herself to the ethics adviser?
Kemi Badenoch
I think that is a ridiculous assertion, and from someone who clearly did not listen to the statement. The difference between what I am saying and what Mr Staunton is saying is that I have officials who will back me up, I have members of the Post Office board who will back me up, and I have newspaper and media outlets that know that I tried to stop the story. The fact is that the hon. Lady just wants to believe Mr Staunton’s allegations because that helps Labour politically, but they are not true. They need to listen to the truth and stop hoping for lies; that is not what our job is in this House.
Clive Efford (Eltham) (Lab)
If Henry Staunton is guilty of what the Secretary of State has accused him, it beggars belief that he was appointed only two years ago by this Government. May I ask her about Post Office investigations? I have yet another constituent who has come forward who was forced to sign a non-disclosure agreement by the Post Office and who has not been fully compensated for what they lost when they lost their business. Is it acceptable for the Post Office still to be involved with investigations, given how discredited those are? How can the victims of this scandal have any confidence whatever in the process that the Post Office is involved with?
Kemi Badenoch
The way we have been dealing with this issue at the Dispatch Box, the work that the inquiry has carried out and our commitment to look at individual cases and ensure that the process is working out properly is how the postmasters will have confidence in the system.
Ben Lake (Ceredigion) (PC)
In recent weeks, I have met with a number of constituents who are former sub-postmasters and who have explained the terrible impact that this scandal has had on their lives. Although they were not convicted by the Post Office, they had to pay large sums of money for shortfalls that frankly did not exist. Can the Secretary of State confirm that the Government’s expectation is that those people will be compensated not only for the money they paid, but the financial and personal harm that this scandal caused in their lives?
Kemi Badenoch
That is definitely what we are trying to do. No one should be in a worse position than they were in before the scandal happened. Where we can provide additional compensation, we will be able to do so, and that is what the process is set up to do.
Stella Creasy (Walthamstow) (Lab/Co-op)
Many of us will be concerned about the Department that oversees employment rights being one where thousands of people know that somebody is about to be sacked before they do. We would agree with the Secretary of State that the process is about giving the public confidence that when wrongs come to light, they will be righted. The challenge she faces is that the track record of recent decades is not good. It is not just about the Horizon scandal, but the nuclear veterans, Windrush, the Women Against State Pension Inequality Campaign, the infected blood scandal and Grenfell. Time and again, it is the compensation schemes that become the story and a source of injustice. Rather than taking to Twitter, would it not be the right rejoinder for her to become the first Secretary of State to say, “We should put the management of compensation schemes involving Government out to an independent body so that everyone can have confidence”? I am sure she would find support from Opposition Members for that.
Kemi Badenoch
First, I have not said that thousands of people knew that Henry Staunton was being sacked; I said that there are thousands of people who work in the Department, and it could have been anybody who put that out there. It is important that we stick to what has been said on the record. The hon. Lady mentions that these scandals go over decades, and I remind her that the Horizon scandal started under a Labour Government; it is this Government who are beginning to fix it.
Barbara Keeley (Worsley and Eccles South) (Lab)
On the shortcomings of the Horizon scheme, I raise with the Secretary of State the case of my constituent Mr Pennington, a sub-postmaster for 20 years, who went through 10 years of financial distress paying back shortfall amounts generated by errors in the Horizon system. The poorly designed Horizon scheme has paid back only part of the shortfalls of possibly £100,000—and only a paltry £1,500 for 10 years of financial stress and worry. I wrote to the postal affairs Minister four weeks ago and have not had a response. When will the shortcomings of the Horizon scheme be reviewed, so that sub-postmasters such as Mr Pennington receive full—not part—compensation for all those years of distress?
Kemi Badenoch
The hon. Lady is right to raise that matter. We are aware of the problem. We are working with the advisory board to see how we can fix it and ensure that people get proper compensation. I have just been told by the postal affairs Minister that the letter she is expecting should be with her shortly.
Florence Eshalomi (Vauxhall) (Lab/Co-op)
I thank the Secretary of State for her statement. She will be aware that many post office branches have closed in recent years, including the Clapham Common post office in my constituency, which is due to close on 6 March. In her statement, she said:
“Right now, the Post Office’s No. 1 priority must be delivering compensation to postmasters”.
Does she agree that millions of pounds spent on the Post Office trying to pay innocent sub-postmasters would have been better spent on ensuring that we keep our vital post offices up and down the country?
Kemi Badenoch
I thank the hon. Lady for her tireless work campaigning to save Clapham post office; I know she has had many meetings with the postal affairs Minister. We should be able both to keep post offices open and to compensate.
Stephen Farry (North Down) (Alliance)
As this is a genuine national scandal, the exoneration of sub-postmasters with criminal convictions requires that they be treated equally, with a shared speedy and common approach, across the UK. Both I and the recently reappointed Justice Minister in Northern Ireland have written to Ministers asking for Northern Ireland to be included in the forthcoming legislation. However, I understand that the Government are currently not minded to do that with the devolved Administrations. Will the Secretary of State confirm that Northern Ireland will be part of that legislation, which I hope will be brought forward soon?
Kemi Badenoch
The hon. Gentleman will know that Stormont is now up and running, and that we will be having conversations with devolved Governments on the best way to resolve this. We do not have an answer now, but we are aware of the issue and are working on it.
Gerald Jones (Merthyr Tydfil and Rhymney) (Lab)
The reports on the weekend were extremely alarming, given how sub-postmasters have been treated in recent years. On the obvious question, can the Secretary of State give any assurance or guarantee that the compensation will be paid and taken forward before the general election is called? That surely is what sub-postmasters would ask for, and it is the least that they deserve.
Kemi Badenoch
That is absolutely the right thing to do. I thank the hon. Gentleman for his question, because it gives me another opportunity to restate that the very idea that compensation would be delayed until after the election is complete nonsense. It does not even make political sense. We want to ensure that people get their money as quickly as possible.
Jim Shannon (Strangford) (DUP)
I thank the Secretary of State for her positive answers. Across the United Kingdom of Great Britain and Northern Ireland, hundreds of postmasters and postmistresses are still awaiting compensation for these wrongdoings. While it is understood that this is a sensitive subject for many, will she provide an update on the expected timescale for compensation of everyone who is entitled across the United Kingdom of Great Britain and Northern Ireland? The fact of the matter is, some people have waited two years, three years and longer, and it really cannot go on.
Kemi Badenoch
The hon. Gentleman is right: it cannot go on. I want to see everyone get their money as quickly as possible. By the end of this year, everybody should have received it. That is certainly what I am working towards.
Brexit: Fourth Anniversary
Kemi Badenoch Excerpts(2 months, 3 weeks ago)
Written StatementsRead Full debate Read Hansard Text Read Debate Ministerial Extracts
The Secretary of State for Business and Trade (Kemi Badenoch)
Today, the Department for Business and Trade will be publishing an update detailing the wealth of Brexit benefits the Government have seized since the UK left the European Union on 31 January 2020.
Since the UK’s departure from the EU, this Government have cut burdensome red tape for business. We have built dozens of trading relationships with new friends and old allies. And we have taken back control of our laws, borders, and tariffs. This new-found agility was crucial in helping us get through the pandemic with the fastest vaccine roll-out in Europe—which in turn allowed us to reopen our economy even sooner.
Where some predicted decline for Britain’s economy after Brexit, the UK has shown expansion.
Since the referendum in 2016, the UK has grown faster than Germany, Italy, and Japan and at a similar rate to France. Our services exports are at a record high of £472 billion and the IMF predicts that between 2024 and 2028 the UK will see the third fastest growth in the G7—stronger than France, Germany, Italy and Japan.
Through Brexit, the UK is capitalising on its economic might, while the Government deliver real, tangible benefits not just for British business but for the British people, too.
We have simplified import tariffs on almost 6,000 goods. Our UK global tariff is lowering costs for both businesses and households. And we have made it easier and cheaper for developing countries to sell to the UK—lifting people out of poverty abroad and lowering prices at home without compromising on quality.
The UK now has a little under 50% of products that are tariff-free compared to the EU’s 27%.
We have also knocked down approximately 500 trade barriers since 2020, including in the US—our single largest trade partner. We have signed memorandums of understanding with seven US states while agreeing quotas for British steel and aluminium—boosting exports and supporting 80,000 jobs across the UK supply chain.
No longer bound by EU state aid rules, we are driving growth in our coastal communities through our freeports programme. In Teesside—the UK’s biggest and first operational port—our tax reliefs, business rates retention policies and investment are helping to generate millions for the local economy while creating thousands of new jobs.
The Government are leveraging our post-Brexit freedoms to make the UK the best place in the world to start and grow a business.
We have already revoked or reformed over 2,000 pieces of EU law with a clear road map to go further.
At the same time we are making it easier for small and medium-sized enterprises—which account for over 99% of UK businesses—to raise finance while simplifying annual leave and holiday pay, and reducing onerous record-keeping requirements under the working time regulations.
Brexit has allowed us to undertake one of the largest shake-ups to procurement rules in this country’s history. Our new procurement regime means a simpler, more effective system, helping SMEs secure a greater share of approximately £300 billion of expenditure every year.
The update we are publishing today also shows that, in addition to delivering for British business and the British people at home, we are delivering for them abroad, too.
The Department for Business and Trade has negotiated free trade agreements with 73 countries from Mexico to Malaysia. We have secured the most comprehensive deal that the EU has ever agreed to in its history. These countries accounted for £1.1 trillion of our trade in 2022 alone.
Our trade deals with Australia and New Zealand—the first to be negotiated from scratch after Brexit—are helping home-grown companies break into new markets on the other side of the world, with the potential to bring in billions of pounds of new investment for the UK.
Our digital agreements with Singapore and Ukraine—regarded as blueprints by other nations striking similar deals—will boost our trading relationships in the digital economy and services sectors by extending market reach and ensuring the secure, tariff-free flow of digital content.
The UK will also shortly be joining the comprehensive and progressive agreement for trans-Pacific partnership. It will make over 99% of UK goods eligible for zero tariffs in the Asia-Pacific’s most dynamic economies.
This year, the Department for Business and Trade is seeking further deals with more fast-growing economies including the Gulf Co-operation Council and India.
We will cement global Britain’s status as an outward-looking, international trading powerhouse, redrawing the rules so businesses can thrive, markets are competitive and consumers are protected.
We will drive further investment from British and international businesses into our economy while strengthening our advice and support for home-grown companies looking to grow and export.
Over the coming year, we will continue to open up new markets for business, promoting free trade, economic security, and resilient supply chains as core pillars of the UK’s trade policy.
We are sticking to our plan to deliver the long-term change our country needs and build a brighter future for the United Kingdom, seizing the many opportunities and benefits Brexit has afforded the British people.
[HCWS231]
Trade (Comprehensive and Progressive Agreement for Trans-Pacific Partnership) Bill [Lords]
Kemi Badenoch ExcerptsMonday 29th January 2024
(2 months, 4 weeks ago)
Commons ChamberRead Full debate Trade (Comprehensive and Progressive Agreement for Trans-Pacific Partnership) Act 2024 View all Trade (Comprehensive and Progressive Agreement for Trans-Pacific Partnership) Act 2024 Debates Read Hansard Text Watch Debate Read Debate Ministerial Extracts Amendment Paper: HL Bill 4-R-I Marshalled list for Report - (12 Jan 2024)
The Secretary of State for Business and Trade (Kemi Badenoch)
I beg to move, That the Bill be now read a Second time.
This Government are proud to champion free trade at every opportunity. We recognise the power and potential of free and fair trade to ease the cost of living, lower prices and extend consumer choice, all of which drives growth across all four nations of our United Kingdom. As exemplified by the free trade agreements that we recently brought into force with Australia and New Zealand, it is UK businesses and UK consumers who benefit when burdensome red tape is cut, greater market access is secured, and trade flows more freely. The UK’s accession to the comprehensive and progressive agreement for trans-Pacific partnership will help us to realise these benefits with 11 countries spanning the Americas and Asia.
As Members will know, this partnership covers a vast area of the globe—500 million people—which already accounts for well over £100 billion-worth in UK trade. Our accession will boost this flow of goods and services even further, leaving more than 99% of UK products eligible for zero tariffs. This matters, because we sell more to CPTPP countries than we do to France and Italy combined. As we join, the partnership will have a combined GDP of roughly £12 trillion in 2022 figures, equivalent to nearly 15% of the world’s total. It will also provide a gateway to the wider Indo-Pacific region, which is set to account for the majority of global economic growth by 2050.
Mr Ranil Jayawardena (North East Hampshire) (Con)
Does my right hon. Friend agree that our leaving the European Union has made it possible to secure these deeper economic and diplomatic ties with some of the fastest growing economies in the world, and that it is only because of the decisions made by this Government that we are now getting on with that job?
Kemi Badenoch
My right hon. Friend is correct. We would not have been able to sign this agreement had we not left the European Union, but we are now able to enjoy the benefits of this free trade agreement as well as the one that we have with the European Union.
Liam Byrne (Birmingham, Hodge Hill) (Lab)
Many of the figures that are sometimes cited about the future size and scope of the Indo-Pacific market include the size and growth of China. Has the Secretary of State reflected further on the evidence that she gave to the Select Committee last week, and can she tell the House whether, if China decides to try to join the CPTPP and meets the technical standards, the UK will block that or welcome it?
Kemi Badenoch
The right hon. Gentleman knows what I said to the Committee. It is important to stress the principle that these are not decisions that the UK makes in isolation, but he will hear more about the arguments relating to accession later in my speech.
One of the major benefits of our accession is the fact that for the first time we will have a trade deal with Malaysia and Brunei—economies worth over £340 billion in GDP. What does that mean for British business? It means, for example, that tariffs on British-made cars exported to Malaysia will be cut from 30% to zero, and that our whisky exporters will see tariffs cut from 80% to zero, a move that has been widely welcomed by members of the Scotch Whisky Association.
Mark Pawsey (Rugby) (Con)
The Secretary of State has spoken about the size of this deal, and she has mentioned the major players in our markets, the automotive and whisky industries, which are of course very big exporters. Will she say a little about the opportunities that may exist for small and medium-sized enterprises, and the work that is being done to open up those opportunities to them?
Kemi Badenoch
There will be a multiplicity of benefits for small businesses—for instance, the tariffs to which I have referred—but the agreement also contains a chapter that was specifically intended to help SMEs to take advantage of it.
Stella Creasy (Walthamstow) (Lab/Co-op)
The Secretary of State mentioned car exports to Malaysia. That, of course, will not make up for the millions of pounds that we now risk losing because of the suspension of the deal with Canada for the automotive industry. The Bill will do nothing to tackle that, because it is based on the accumulation of EU content that we need. Will the Secretary of State tell us what on earth she will do to fight for British car makers, given that we shall now have the worst of all worlds, and we are not even part of a “Canada-style deal” with Canada?
Kemi Badenoch
First, Canada is part of the CPTPP. Secondly, the rules of origin, to which the hon. Lady was referring, have still not been fully decided; that will come in March. We are working with our counterparts in Canada. I think the hon. Lady was confusing the discussions on rules of origin with discussions on cheese, which is an entirely different issue.
UK companies will enjoy greater market access in some of the nine countries with which we already have bilateral agreements. Let us take Mexico. Under our current bilateral agreement, chocolate producers must pay a tariff of about 25%, but on accession that will drop to zero. We also said at the outset of our negotiations that we would like our businesses to benefit from the key trade quotas that this agreement offers. I am pleased to tell the House that we have secured access to those quotas as part of our negotiations. That means, among other things, that we have secured better access for UK dairy producers selling to Canada, Japan and Mexico, and it probably explains why Minette Batters, the president of the National Farmers Union, has said that the agreement could provide
“good opportunities to get more fantastic British food on plates overseas.”
I am sure that all Members here today would warmly welcome such an outcome.
Dr Neil Hudson (Penrith and The Border) (Con)
I commend the Secretary of State and the Government for the stance that they have taken with our friends and allies in Canada, namely that the UK will not permit the import of hormone-treated beef. It is important that we can be a beacon to the rest of the world in that regard. Can the Secretary of State reaffirm to the House and the country that we will stand firm in continuing to prohibit the import of not only hormone-treated beef, but ractopamine-treated pork and chlorine-washed poultry? It is vital that we uphold animal health and welfare standards, as well as helping to protect public health.
Kemi Badenoch
I am happy to confirm that that is the case. We are now in a position to make our own decisions on what we do with trade agreements. We have said that we will never compromise on animal welfare or environmental standards, and we continue to regulate. The difference between this deal and the kind of deal that we had previously with the EU is that we did not then have complete freedom to regulate.
Another notable benefit concerns rules of origin. Joining this partnership will mean that content from any CPTPP country can be counted as qualifying when goods are exported within the trading bloc, and that has the potential to benefit our innovative British-based manufacturers, including our car industry. In the automotive sector we have an exceptionally competitive global market, especially as we make the transition to electric vehicles. Critical minerals are needed for their production, and those are inevitably difficult to source in a global supply chain. It is therefore essential to the success of our industry that more countries recognise where a component is made and accept it as part of one supply chain.
For example, say one of our big automotive manufacturers in the west midlands ships a part to Mexico for additional assembly, and that part is then sent on to another CPTPP country, such as Japan, for final manufacturing. Post accession, the parts made in the west midlands will meet the agreement’s rules of origin. That is a real incentive for CPTPP countries to purchase more British-designed, British-made products, and it is part of the reason why our future accession to this partnership has been so warmly welcomed by the sector. Mike Hawes, chief executive officer of the Society of Motor Manufacturers and Traders, has said that the agreement makes “eminent sense” and has the potential to deliver opportunities for the automotive industry.
Matt Western (Warwick and Leamington) (Lab)
It is good to hear from Mike Hawes and to learn what he thinks, but can the Secretary of State give the House some indication of what contribution the CPTPP will make to our GDP?
Kemi Badenoch
According to the models and estimates, it will be £2 billion a year, but it all depends on which countries choose to accede and how many businesses in the UK choose to take advantage of the agreement. A free trade agreement utilisation programme will therefore be critical to our gaining the greatest possible benefits from the CPTPP.
Mark Garnier (Wyre Forest) (Con)
There is a great deal of argument about where the opportunity for UK exporters is. Does my right hon. Friend agree with the prediction that the 10 nations of the Association of Southeast Asian Nations will create a bigger trading bloc and a bigger economic unit than the European Union by 2050, and does she agree that the CPTPP offers the opportunity for countries such as the Kingdom of Thailand, which is not a member, to join in the future? Surely the CPTPP is not about what it is now, but what it will be in the future.
Kemi Badenoch
My hon. Friend is absolutely right. This deal is thinking about the future. Of course we have a close trading relationship with the European Union, but the fact is that, as a share of global growth, Europe is shrinking and other parts of the world are growing. This is our opportunity to get in early and help shape the rules for this trading bloc.
Richard Graham (Gloucester) (Con)
The Business Secretary is making a powerful case on why accession to the CPTPP will be transformative for our country in so many ways. She alluded to the importance of business with Malaysia. This is not just about trade; it is also about investment. The importance of Malaysian investment over here is symbolised by Brabazon on the edge of Bristol, and by Battersea power station. Does she agree that all those investments will be much more secure under the umbrella of the first ever trade and investment agreement with Malaysia?
Kemi Badenoch
I agree with that statement. I would just like to highlight the significant contribution that our trade envoys, including my hon. Friends the Members for Wyre Forest (Mark Garnier), and for Gloucester (Richard Graham), are making to our debate on trade. They are getting out there, bringing business to the United Kingdom, selling all that is great about our country, and making a valuable contribution to trade policy in the UK, and I want to take this opportunity to thank them for all the work they are doing, travelling around the world and banging the drum for British trade.
Liam Byrne
Before the Secretary of State moves off the subject of cars, I want to make an intervention about our trade with Canada, which involves more than £745 million-worth of exports. We currently benefit from tariff-free trade because of the extended accumulation of origin rules. That tariff break will end at the end of March, and because talks have broken down, we face a situation where our car exports are about to be hit by tariffs. Can she tell the House a bit more about how she plans to avoid a tariff war hitting UK car exports at the end of March?
Kemi Badenoch
This is a good opportunity for me to state explicitly that the talks have not broken down. We are having multiple discussions with Canada on cheese, in which we have not come to an agreement. However, the quota that we have under CPTPP with Canada is 16.5 kilotonnes, which is more than the 2 kilotonnes we are selling to Canada at the moment, so we are not particularly concerned about that, although it is disappointing. We have an ongoing rules of origin discussion, and we have an FTA discussion, which I have paused, for reasons that the right hon. Gentleman will know—
Kemi Badenoch
Well, he should know them, because I believe I referred to them in the Select Committee; I hope he was listening. The point I am making to the Chair of the Select Committee is that trade is dynamic. On some issues that we are negotiating and discussing with our partners, we have differences of opinion; and others are going swimmingly. This is not a reason for us to cast aspersions on our trade relationships with the countries in question.
Joining this partnership will deliver for our manufacturers, but crucially it will also deliver for our globally renowned services sector. The UK is already the world’s second largest exporter of services, behind only the US, and services exports are at record levels. CPTPP, with its modern and ambitious rules on services and digital trade, plays to the UK’s strengths, given that almost 80% of our economy is services-based. It will reduce market access barriers, such as data localisation requirements; British businesses will not have to set up costly servers or data centres in each member country, and that will save them significant time, money and other resources. This agreement will help flagship British businesses such as Standard Chartered and BT to gain smoother access to markets in Singapore, Vietnam and Malaysia, strengthening our trade with those nations for years to come.
We also have a ratchet mechanism for the first time with Malaysia, Chile, Mexico, Peru, Singapore, Brunei and Vietnam, meaning that if those countries relax rules for a particular service, restrictions cannot then be reintroduced in future. That is another clear example of how this agreement will unlock smoother, simpler trade. The director general of the Institute of Export and International Trade, Marco Forgione, has rightly said:
“This is all good news for UK businesses, giving them greater access to one of the fastest growing regions in the world”.
The issue is not just the benefits that joining this partnership will bring over the short term. This is a growing agreement, designed to expand and bring in more markets and more opportunities for UK businesses in the long run. As the first acceding country, we will be ideally placed to take advantage of that future growth.
Martin Vickers (Cleethorpes) (Con)
I welcome our accession to CPTPP, which I think will be of great national benefit, but understandably Members across the House will look to businesses in their constituency. The Secretary of State is well aware that many businesses in my constituency in the Humber region are focused on the energy sector, particularly renewable energy. Does she see any great advantages for them?
Kemi Badenoch
There are multiple advantages that will accrue to my hon. Friend’s constituency. I do not specifically have figures for the energy sector, but I do have good news relating to Yorkshire and the Humber: 465 businesses are already exporting to Malaysia from Yorkshire and the Humber, and CPTPP will help to boost that region’s economy by around £210 million in the long run. In 2022, Yorkshire and the Humber exported £1.3 billion-worth of goods to CPTPP. Within five years, tariffs of up to 30% will be eliminated on UK exports of machinery to Malaysia, cutting costs for businesses in Yorkshire and the Humber. We will reduce tariffs and non-tariff barriers, which could mean many more companies—such as the jukebox manufacturer Sound Leisure, which already exports to five CPTPP countries—being able to enter more dynamic markets.
The Chair of the Select Committee, the right hon. Member for Birmingham, Hodge Hill (Liam Byrne), raised questions about China, and I promised to address them. On China’s application to accede to the agreement, which I know many hon. Members are interested in, let me first say that there are six economies with applications to join the group—China, Taiwan, Ecuador, Costa Rica, Uruguay and Ukraine—and more may apply. Members have not yet made any decisions on which economies will accede in future.
Every applicant must fulfil three essential criteria, called the Auckland principles, to join the group. First, they must be able to meet the high standards of the agreement. Secondly, they must have a track record of compliance with existing trade commitments. Thirdly, and crucially, they must command a consensus of the whole group. These are strong criteria, and they make it clear that working as a bloc is vital. The purpose of this partnership is to be a growing trade bloc, and we share that ambition. We want this agreement to grow, but our accession has set a clear precedent for those that follow. The robust process that the UK has been through has only reinforced the high standards that the partnership seeks to promote, and it has proved that the bar is not easy to meet.
Mr Jayawardena
Does that not prove that by being positive and seeking to engage with partners around the world, we can shape this trade area in line with our geostrategic and trade interests?
Kemi Badenoch
Yes, it absolutely does. That is one of the ways that we are able to increase UK influence across the world, not just in Europe or near neighbouring countries. My right hon. Friend is absolutely right on that.
Chi Onwurah (Newcastle upon Tyne Central) (Lab)
The Secretary of State talks about free and fair trade and about high standards, but there is nothing on labour rights in this CPTPP deal. Is that because she does not care about labour rights? Does she not think it matters whether UK businesses and workers have to compete with those producing products and services in circumstances where there are no trade union rights and no health and safety rights, for example? Is it because she does not care about labour rights, or because she was unable to negotiate anything?
Kemi Badenoch
I think the hon. Lady might be confusing the contents of the Bill with the text of the agreement. The text of the agreement is on gov.uk, and she will find a chapter there that covers labour rights.
I turn briefly to the Bill. It is technical in nature, but in enabling us to comply with the provisions of the deal, it is crucial to unlocking the benefits I have described. First, the Bill will ensure that the UK’s domestic procurement regime is compliant with the partnership’s rules, and it will give effect to the UK’s market access commitments to CPTPP suppliers. This small change will deliver big benefits for British businesses, allowing them to compete for contracts in Canada, Japan and Peru that go beyond our existing agreements. It will also mark the UK’s first ever trade agreement with Malaysia and Brunei that contains Government procurement provisions, and will create entirely new access opportunities for UK businesses. The Bill will also allow conformity assessment bodies established in parties’ territories to apply for approval in the UK. This will mirror the treatment that UK conformity assessment bodies will receive from CPTPP parties, which would reduce costs for UK businesses.
The Bill will amend domestic law so that, in relation to agrifoods only, an application to register a geographical indicator can be opposed on the ground that it is likely to cause confusion with a pre-existing trademark or application for a trademark. The Bill will also introduce the ability to cancel a registered agrifood GI on the ground that, at the time the GI was applied for, it was likely to cause confusion with a pre-existing trademark or application for a trademark, or because it is a generic term.
Finally, the Bill brings our approach to copyright in line with the CPTPP by amending the basis on which foreign performers, such as musicians, can qualify for rights in the UK.
In sum, the implementation of the Bill is essential for the UK to meet its obligations upon accession to the comprehensive and progressive agreement for trans-Pacific partnership. The agreement offers significant benefits to UK businesses and consumers, by lowering tariffs, driving up trade and giving us access to the markets that will be front and centre of the global economy for the next quarter century. It is right that we seize the many opportunities that the partnership will bring, which is why I commend this Bill to the House.
Gareth Thomas
As the hon. Gentleman knows, other evidence was given to the Select Committee that underlined the likely loss to farmers and the agriculture sector in general. I will be happy to send him the note from that Select Committee.
There are questions about the intellectual property section of the Bill. There are wider concerns that Britain has been forced to be a rule-taker on the use of secret courts, that there are poor environmental and labour rights provisions and, crucially, that Ministers have no plan to help British business capitalise on this deal. Given the Government’s woeful performance on economic growth, the recent huge increases in barriers to trade and the cuts in support for exporters, we are pleased about any measures that help our exporters even a fraction.
The Secretary of State did not own up to it but, for the foreseeable future, this trade deal will have, at best, a minor impact on our terms of trade. There are trade benefits to membership, notably in the rules of origin provisions and in trade with Malaysia and Brunei, and there is longer-term potential if CPTPP becomes a deeper or more extensive trade bloc. In geopolitical terms, the closer ties with allies in the Indo-Pacific that CPTPP ushers in are welcome in these increasingly uncertain times.
Unfortunately, rational debate about these opportunities and trade-offs has been hampered by some of the more extravagant and exaggerated claims made by Conservative Members for the benefits of CPTPP membership. It was set to offer “unparalleled opportunities” for the UK. It was going to be a “glittering post-Brexit prize”. The Secretary of State has even done her own bit for such boosterism, with her Department claiming last year that all that is needed is for the US and half the rest of the world to join, and then there would be an extra £21 billion for the UK. I enjoyed “Wonka”, but I did not expect to find that level of fantasy preparing for this debate.
According to the Government’s own figures, this trade treaty was only ever going to deliver a 0.08% increase in economic growth over 10 years. It is nice to have, particularly given the mess that the Government are making of the economy, but now even the limited trade benefits they promised us have been cut in half.
Kemi Badenoch
The hon. Gentleman references my Department’s trade figures. These are modelling forecasts based on old figures that did not count the dynamic effects of trade agreements. They are completely out of date. They were done well before the agreement had even been negotiated, so they should not be used as a basis for deciding how this agreement will do.
Gareth Thomas
One set of figures the Secretary of State’s Department definitely did not put together were those that the Office for Budget Responsibility produced. It now expects only a 0.04% increase in our economic growth, after a decade, from joining CPTPP. As we already have free trade agreements in place with nine of the other 11 CPTPP members, formally joining CPTPP feels rather thin compensation for Ministers’ many other failures on trade.
Oral Answers to Questions
Kemi Badenoch Excerpts(3 months ago)
Commons ChamberRead Full debate Read Hansard Text Watch Debate Read Debate Ministerial Extracts
Jamie Stone (Caithness, Sutherland and Easter Ross) (LD)
The Secretary of State for Business and Trade (Kemi Badenoch)
The Government provide extensive business support for all businesses, including those in rural areas. As a Member of Parliament for a rural constituency, I am keenly aware of the difficulties that apply specifically to rural businesses because of their location. With other Departments, we focus on access to energy, and we work with the Department for Education on apprenticeships. We also have the British Business Bank’s recovery loan scheme, and the Start Up Loans company, which improves access to finance to help businesses to invest and grow. I believe that that package helps rural businesses.
Jamie Stone
The Secretary of State will be aware that the Sutherland spaceport could be a fantastic boost for local businesses. Equally, floating offshore wind in the North sea presents opportunities for the Wick and Scrabster harbours. To underpin that, we need the transport infrastructure. The public service obligation for Wick airport runs out in March this year, with no word from the Scottish Government on whether it will be continued—it would be a fatal blow if not—and then there is the abject failure to invest in the A9. Promise after promise after promise has been broken. What advice does she have for me?
Kemi Badenoch
I would ask the hon. Gentleman to speak to the SNP-led Scottish Government, who are responsible for much of that investment. It is a real shame that the SNP Government do not care about rural businesses or small businesses in Scotland. Office for National Statistics figures show that Scotland lost more than 20,000 businesses last year, and they were mainly the smallest businesses employing up to 50 people. However, I take his point about infrastructure. We have to look at that on a UK-wide basis, and I am prepared to look in a little more detail at what my Department can do to support him.
Dr Thérèse Coffey (Suffolk Coastal) (Con)
I think that my right hon. Friend is doing a great job for rural businesses. However, the Met Office, which is under her stewardship, is responsible for providing wind forecasts, which are particularly important given that the Orwell bridge was closed recently. I would like there to be more transparency and, specifically, for the Met Office to publish the wind speed on its app so that there is transparency for all businesses and the bridge is not closed unnecessarily.
Kemi Badenoch
That sounds like a significant issue. However, I am pleased to say that the Met Office is the responsibility not of my Department but of the Department for Science, Innovation and Technology. We can raise the matter with DSIT colleagues to ensure that they look at it as quicky possible.
Mr Rob Roberts (Delyn) (Ind)
The Secretary of State for Business and Trade (Kemi Badenoch)
The Department for Business and Trade has done a lot to bring foreign direct investment into the UK. Just last November, we raised £30 billion at our global investment summit. Specifically for north Northamptonshire, my hon. Friend will be pleased to know that his constituents can take advantage of the DBT national and regional investment teams, which work with local partners to provide support for foreign investors who wish to invest and set up in the region.
Mr Hollobone
Recent inward investment into the Kettering constituency includes the Ball Corporation from the US building Europe’s largest and most modern aluminium drinks can manufacturing plant in Burton Latimer, creating 200 new jobs. Will my right hon. Friend congratulate and thank Ball for its confidence and investment in north Northamptonshire’s manufacturing economy, and encourage others to see Kettering—with its superb connectivity and motivated workforce—as an ideal location for further investment?
Kemi Badenoch
I am extremely pleased to be able to do so. I congratulate and thank Ball Corporation for placing its investment in Kettering. That is exactly the sort of investment that we want to see all around the UK: it is the levelling-up agenda writ large. I also thank all the officials in my Department, but especially my Ministers, who travel all around the world—including to the US—to promote the UK. We never talk this country down; we let people know that this is a great place to do business, and we are seeing the benefits of that strategy.
Jeff Smith (Manchester, Withington) (Lab)
Greg Smith (Buckingham) (Con)
The Secretary of State for Business and Trade (Kemi Badenoch)
At the autumn statement, we announced the decision to extend the growth duty to Ofgem, Ofwat and Ofcom, alongside a series of reforms to the duty to hold regulators to account for delivering growth in the sectors they regulate. We are also currently consulting on proposals to strengthen the economic regulation of the energy, water and telecoms sectors.
Greg Smith
I am grateful to the Secretary of State for that answer, but on retained EU law reform, in the June to December 2023 reporting period there were only two regulatory reforms of note, which were on wine marketing and working time calculations; the rest were technical corrections. What steps is she taking to speed up reform of retained EU law to ensure that regulation works for business and enables growth?
Kemi Badenoch
I am glad that my hon. Friend read the report that I sent out this week on what we have been doing. However, I disagree that only two reforms of note have been delivered. We have repealed or reformed more than 2,000 measures. The Port Services Regulations 2019, which were not designed with UK ports in mind, are an example. We have also passed the Financial Services and Markets Act 2023 and the Procurement Act 2023. I remind him that that list is what we are using the schedule for, and there are many other mechanisms in the retained EU law programme to deliver on that road map so that we improve our economy and make it more competitive by making sure that our laws are tailored to our economy.
Richard Foord (Tiverton and Honiton) (LD)
In support of economic growth, the right hon. Member for South West Norfolk (Elizabeth Truss) cut £235 million from Environment Agency budgets when she was at the Department for Environment, Food and Rural Affairs. Rather than bringing economic growth, that served to bring sewage growth: sewage discharge doubled between 2016 and 2021. I was delighted to hear yesterday that the Government will adopt my Water Quality Monitoring Bill, but will they also restore some of the cut Environment Agency funding to bring back powers as well as duties?
Kemi Badenoch
A spending review, where we can look at these things, will be coming up shortly, but I really have to challenge much of what the hon. Gentleman said. It is a misrepresentation to say that the issues going on with sewage are to do with the actions of my right hon. Friend the Member for South West Norfolk (Elizabeth Truss). This Government have been taking reforms through the Environment Act 2021 to improve the situation throughout multiple Governments, including the one in which his party, the Liberal Democrats, participated during the coalition. So it is very wrong to make that case.
Mr Alistair Carmichael (Orkney and Shetland) (LD)
The Secretary of State for Business and Trade (Kemi Badenoch)
As Secretary of State for Business and Trade, I am committed to ensuring the resilience of the UK’s critical supply chains. Last week, the Government published the “Critical Imports and Supply Chains Strategy” to help UK businesses build secure and reliable supply chains. Our 18-point action plan will help businesses to deal better with global supply chain issues from overcoming bureaucratic barriers to dealing with severe shocks caused by events such as the pandemic, Russia’s war in Ukraine and the attacks on the Red sea that have threatened a key route for global trade. DBT led the development of the strategy, which was shaped by the experiences of UK businesses. I was delighted that representatives of industry as well as key international partners joined us at the strategy’s launch at Heathrow airport, which is, of course, the UK’s largest import hub by value.
Mr Carmichael
Mr Speaker, I wish you and the rest of the House a happy Burns night for this evening. Is it not a scandal that the only way to get the great chieftain o’ the puddin-race exported to the United States is by sending the vegetarian version? [Hon. Members: “Oh!”] Could not the Secretary of State put that into her 18-point action plan and get on and do something, or does she want to risk forever being known as a cowran, tim’rous beastie? [Laughter.]
Kemi Badenoch
I thank the right hon. Gentleman for his esoteric question. We are continually removing barriers to US-UK trade, and we are trading with the US more than ever before. If he has a specific example that I can help with so that he can enjoy his Burns night, I would appreciate it if he wrote to me, and we will look at the matter in detail.
Duncan Baker (North Norfolk) (Con)
Theresa Villiers (Chipping Barnet) (Con)
Kemi Badenoch
I cannot comment on the ongoing Northern Ireland political process, to which I am not a participant. However, it is clear that we retain the ability to diverge. I agree with my right hon. Friend that if we are to seize the benefits of Brexit, we need to find that comparative advantage over the EU in our regulations, otherwise there would be no point. I remind her that I was the Business Secretary who made sure that there was transparency, rather than an invisible bonfire, in what we were doing on EU regulations. I ended the jurisdiction of the European Court of Justice on 1 January. We have a comprehensive deregulation programme, which I am pushing. I understand her concerns, and I will speak to colleagues across Departments to ensure that they are raised at the highest level.
Christine Jardine (Edinburgh West) (LD)
Kemi Badenoch
It is really important for us to not misrepresent what is happening on steel. Our steel industry is not disappearing; our steel industry is evolving. We will continue to have significant steelmaking capability in the UK, including producing materials for the industries the hon. Lady talks about. But we should also remember that the changes to Port Talbot are part of the decarbonisation that all Opposition Members have been asking for. This is the biggest single emitter of carbon in the UK and this House voted to reach net zero by 2050. Everything we are doing is to ensure that we do that in a sustainable and sensible way.
Martin Vickers (Cleethorpes) (Con)
Following on from the question by my hon. Friend the Member for Scunthorpe (Holly Mumby-Croft), for the sake of clarity, can the Secretary of State confirm that it remains the Government’s position to ensure that the UK has the capacity to produce virgin steel here in the UK?
Kemi Badenoch
The Government maintain that we want to ensure that we keep steelmaking capability in the UK. At the moment, we import ore to make steel. When we talk about virgin steel many people assume there are no imports in the supply chain, but there still are, even now, and whatever changes we make will require some imports. However, we are making sure that our steel industry is more resilient than ever before, at a time when it faces oversupply from China and India. That is the real problem faced by the steel industry in all of western Europe. We do a lot with tariff measures, such as steel safeguards—
Mr Speaker
Please, do not do that. I called the next Member, so I expect you to sit down. It is topical questions, not free statements.
Mr Speaker
Order. The Secretary of State took advantage; I do not want the hon. Lady to do exactly the same.
Kemi Badenoch
I believe that this might be an issue for the Department for Culture, Media and Sport, but if the hon. Lady will write to me, we can look at that specific case.
Jo Gideon (Stoke-on-Trent Central) (Con)
I am grateful to the Minister for working with me on the issue of button battery safety, and grateful for the ongoing commitment of the five working groups that were set up in 2022 following the tragic death of one of my constituents, Harper-Lee Fanthorpe, and the campaign for Harper-Lee’s law. Will the Minister meet me to discuss progress, and, in particular, how the guidelines drawn up by the Office for Product Safety and Standards can be made compulsory so that more deaths and injuries from button battery ingestion can be prevented?
Alistair Strathern (Mid Bedfordshire) (Lab)
I am sure that the Secretary of State shares my desire to revitalise our fantastic local high streets. Flitwick Town Council plans to do exactly that, but it needs support from the community ownership fund. May I urge the Secretary of State to look favourably on its forthcoming application?
Kemi Badenoch
It is good to see the hon. Gentleman working so hard for his community. The community ownership fund sits with the Department for Levelling Up, Housing and Communities, but I am sure that if he makes representations to those in the Department, they will be able to give him a more substantive answer.
Mr Barry Sheerman (Huddersfield) (Lab/Co-op)
Will the Secretary of State look at the impact assessments of universities? The traditional universities are failing to meet the standards of sustainable development research, and Manchester, Huddersfield and Newcastle Universities are doing much better. Will the Secretary of State look into that, and push the other universities to do better?
Kemi Badenoch
This is a matter that sits with the Department for Education, but of course my Department takes an interest in all the innovation research that is going on, because it will help to boost the UK economy. I am sure that officials in my Department have been looking at those assessments, and will be able to provide details if the hon. Gentleman has a more specific question.
Electric Vehicle Rules of Origin: Extension
Kemi Badenoch Excerpts(3 months, 2 weeks ago)
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The Secretary of State for Business and Trade (Kemi Badenoch)
On 21 December, the United Kingdom and the European Union jointly agreed an extension to the UK-EU trade and co-operation agreement’s rules of origin for electric vehicles and their batteries, until 31 December 2026.
To access zero tariffs under the TCA, businesses must prove that their products include a minimum level of EU or UK-manufactured content. These requirements are known as rules of origin and help determine where products originate rather than where they are shipped from, to ensure lower tariffs are correctly applied to eligible products and to support market competition. The TCA included a staged approach for electric vehicles and batteries, which required phased increases in these rules of origin requirements. The first increase was due to take effect on 1 January 2024, before a final increase from 1 January 2027. The agreement with the EU cancelled the 2024 changes, meaning the existing rules of origin will last until the end of 2026.
This extension of the rule set for these commodities has also been replicated in the UK-Turkey preferential trade agreement. This agreement has been amended by Joint Committee Decision to ensure consistency between the preferential trade agreement and the EU-Turkey customs union.
The agreement avoided a cliff edge which could have seen consumers and manufacturers in the UK and EU hit with £2 billion to £4 billion-worth of tariffs—on average over £3,000 per car—and it safeguards the position of UK manufactures as they transition to net zero, protecting thousands of British jobs. This is a pragmatic change which will help economic growth, UK consumers, and the environment; it recognises the disruption caused by the covid-19 pandemic, global supply chain pinchpoints and Russia’s illegal invasion of Ukraine.
This Government are determined to ensure the UK remains one of the best locations in the world to build zero-emission vehicles, and we have taken action accordingly. At the autumn statement, as part of the advanced manufacturing plan, we announced over £2 billion in capital and R&D investment for the automotive sector to support the manufacturing and development of zero-emission vehicles, batteries and supply chain—building on existing support.
The UK and EU remain determined to develop domestic electric vehicle battery capacity, so we have also agreed to remove our ability to amend further these rules of origin again until 2032. In November we published the UK’s first ever battery strategy, outlining our plan to attract investment and achieve a globally competitive battery supply chain by 2030.
The UK’s approach has already attracted landmark investments in gigafactories and electric vehicle manufacturing. This includes the recent announcement of a £2 billion Nissan-led investment to produce two new electric vehicles in Sunderland; Tata’s investment of over £4 billion in a new 40 GWh gigafactory; BMW’s investment of £600 million to build next-generation Mini electric vehicles in Oxford; Ford’s investment of £380 million in Halewood to make electric drive units; and Stellantis’s £100 million investment in Ellesmere Port for electric vehicle van production.
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