Protection from Redundancy (Pregnancy and Family Leave) Bill

Debate between Kevin Hollinrake and Bob Stewart

Wednesday 2nd November 2022 Public Bill Committees

[Kevin Hollinrake]

My hon. Friend is a doughty and persistent campaigner, which Members have to be to get across what they want—my seven years as a Back Bencher taught me that. I responded to a letter of hers on this matter very recently. Her campaign is holding a drop-in session from 11 am to 1 pm today, and I am sure that anybody who wants to take part is welcome.

As the hon. and gallant Member for Barnsley Central set out, these simple clauses give the Secretary of State a new power to make regulations on redundancy during pregnancy, and extend existing powers to make regulations during or after a relevant period of leave. The Maternity and Parental Leave etc. Regulations mean that before making an employee who is on maternity leave redundant, employers have an obligation to offer them—not just invite them to apply for—a suitable alternative vacancy when one is available. Our response to the 2019 consultation on pregnancy and maternity discrimination made it clear that we will use the new powers in the Bill to extend MAPLE protection into pregnancy and for a period after return to work.

[Bob Stewart (Beckenham) (Con)]

I intervene only to make a point I made on Second Reading, which was that perhaps we could insist in the Bill that employers outline to employees who have become pregnant their rights. They could give them a piece of paper that tells them what they should do. That would make it absolutely plain.

Sanctions

Debate between Kevin Hollinrake and Bob Stewart

Tuesday 22nd February 2022 Commons Chamber

[Kevin Hollinrake (Thirsk and Malton) (Con)]

It is clear that Putin is not afraid to weaponise his foreign policy through his armed forces, and through oil and gas supplies. It is therefore only right that we look to weaponise our foreign policy in this regard using the City of London. It may well be that, as the Minister said, we will go further quickly, but so far we have not gone far enough. Of course it might not be in our financial interests to do this. Some financial interests—some of our domestic financial organisations—might suffer, but their financial interests cannot supersede the national interest.

When we have looked at sanctions on Russia before, not least in 2015, following the invasion of Crimea, we did not go anywhere near far enough. We did not sanction Russia’s oil and gas supplies, which make up 70% of its exports. We sanctioned things such as exports of milk—clearly, that is never going to go far enough. While Russia has been reducing its dependency on our capital markets, because it saw something like this happening in the future, countries in the EU, in particular, have not being doing the same with their dependency on Russian oil and gas exports.

Lots of people have talked today about Nord Stream 2. Obviously, I welcome the fact that there will be a sanction on that, in terms of preventing it from ever—at this point in time—pumping gas. However, we should not forget that no gas is travelling down Nord Stream 2 now and that all the gas comes into Germany on Nord Stream 1. Again, those oil and gas exports will continue into Germany and other nations. Clearly, there is a huge economic need for that gas going into Germany, but it is incumbent on us and on every nation across Europe—every peace-loving nation—to reduce our dependency on Russia in every economic area.

Russia is not a large economy—its economy is smaller than that of Italy—so there are many things we can do to put further pressure on Russia through sanctions. These are things we have not done today—we have not discussed the potential for them today at all. People have talked about the SWIFT payment system. Clearly, Russia has other opportunities and can use other communications systems, but none the less addressing this would help. Preventing Russia from trading in sovereign debt has been mentioned, but what has not been mentioned is access to clearing banks. It would be catastrophic for Russia if we prevented its access to our clearing banks. Instead, we have sanctioned five very small banks. There may be good reason for that; there may be more provisions we need to put in place before we can apply further sanctions to the larger banks, and clearly there is interdependency between Russian banks and banks around the rest of the world.

The banks that we should be looking at are: VEB, which is the Russian development bank; the Russian Direct Investment Fund, which is the sovereign wealth fund; and, as a few Members have mentioned, Russia’s retail banks. SberBank has roughly 36% of SME—small and medium-sized enterprise—lending in Russia, with VTB having 20% of consumer loans. Clearly, we have to do this carefully and it may well be that we act in concert with other parties, not least the US, the EU and others. If we simply put sanctions on today, that could mean that Russian banks avoid having to settle debts to UK banks and banks in different parts of the world. Although we do not want to do anything that would cause systemic risk to UK financial markets, we are talking in the billions of dollars here rather than in the trillions, and there are other ways of shoring up our system to prevent that happening. However, what is important now is that there is no doubt that we need to go much, much further than we have done already.

[Bob Stewart]

Mr Putin may well have won, because we have not reacted hard enough. Small banks have been sanctioned, but we have not put in place real sanctions. So he will be sitting in Moscow tonight thinking, “I’ve just got to sit this one out and I will be able to play up the gains we have got extremely well to the Russian people.” We are really on dangerous ground by our weakness.

[Kevin Hollinrake]

That is certainly how it looks to me at this point in time, so it is important that we now move very quickly to take the further measures we have discussed today on the Floor of the House.

There is, of course, a wider context around this debate. Many Members on the Government and Opposition Benches have been calling for an economic crime Bill and talking about the failure to prevent economic crime. It is vital to make sure that measures such as sanctions are not subverted—that our banks follow the rules, basically. That would apply a lot of pressure on banks to make sure that sanctions are properly imposed. I have previously mentioned whistleblowers, the proper resourcing of our crime agencies, and the need to change the rules on unexplained wealth orders so that we can take wealth very quickly from people we identify.

I have outlined some more long-term measures that it will take some time to implement, but we could move very quickly with a register of overseas entities. We have previously had draft legislation—Members have mentioned being on the scrutiny Committees—so we could move really quickly. As has been mentioned, £1.5 billion-worth of property in the UK is owned by Russians who are connected to crime and corruption. Some 50% of that is registered in overseas territories and Crown dependencies, the public registers of which are not supposed to go live until 2023. The reform of Companies House would serve as a check and balance, and the move from register to regulator would mean we could properly establish the identities of directors and shareholders.

All those things I have mentioned could and should be done very quickly. That would have a meaningful effect on people connected to the Russian state. We need to act very quickly—we need action this day.

Finance Bill

Debate between Kevin Hollinrake and Bob Stewart

Report stage & Report stage: House of Commons & Report: 1st sitting & Report: 1st sitting: House of Commons
Wednesday 1st July 2020 Commons Chamber

[Kevin Hollinrake]

I absolutely agree. Any businessperson starts off on the premise that they have responsibilities not just to their shareholders, but to their customers and other stakeholders.

Due to the scale of the problem and the lack of country-by-country reporting, it is difficult to establish exactly what some of these companies are making in the UK, but let us look at Google as an example. In 2018, Google turned over $137 billion and had net revenues— so a profit—of $31 billion. The whole organisation internationally works on a profit margin of about 22%. The company turned over around $10 billion in the UK in the same year, and makes about $2.2 billion of profit from UK activities each year. If we applied 19% corporation tax to that amount, we would come up with a figure of £420 million in corporation tax that Google should have paid. It actually paid £67 million that year. This is happening on a huge scale and is multiplied by many other companies.

[Bob Stewart (Beckenham) (Con)]

I thank my good and hon. Friend for allowing me to speak. This confuses me. I would have thought that very clever tax inspectors could visit these international companies. Surely these companies cannot disguise the money that they are sending out of the country. Surely we have methods of checking that, and, from that, we can devise a way of actually taxing them. It seems to me, from what I can gather from this debate, that these companies seem able to spirit money away with magic dust or something, and I am sure that that cannot be so.

Lloyds, HBOS and the Cranston Review

Debate between Kevin Hollinrake and Bob Stewart

Tuesday 4th February 2020 Westminster Hall

[Kevin Hollinrake]

The hon. Gentleman makes an interesting point, although that is not a model I am familiar with. Class actions are definitely opportunities that are not well exploited the UK because of our legal system. I would be keen to talk to him further about that approach.

Within our system we have the Financial Ombudsman Service, which does not necessarily have the best reputation, although I know the hon. Gentleman is talking about something different. It is a problem that whoever is overseeing cases has to be competent and have the right understanding, because there are complex cases that take into account issues around complicated banking products. We have to ensure that the calibre of arbitration or adjudication is at the right level—I will say more about that shortly. We certainly need reform. Moving forward, we think we have a good solution, but we need to continue to improve on that.

This is not just about Lloyds. There are a number of other redress schemes for banking malpractice and mistreatment that have already been conducted by relevant banks. Banks were the principal arbiters of deciding how much compensation people were allowed to have relating to the interest rate swaps schemes and interest rate hedging products, many of which had a devastating effect on businesses. The debates that we have had about the Royal Bank of Scotland, over the past months and years, have raised similar problems about the mistreatment of small businesses. There are problems with their review process and with others, as other hon. Members have said.

I will describe cases that put that into perspective. The first person to write to me about a business banking dispute was Jon Welsby from Filey, when I first became a Member of Parliament. He showed me a huge file of evidence about his business, but the dispute came down to quite a simple problem. He had been sold a swap by Lloyds bank—they were sold by many different banks—that had had a devastating effect on the interest rates he had to pay. The amount he had to pay rose from about £5,000 a month to £17,000—perversely, as interest rates fell, as that was the way swaps worked. He was given direct losses, but he was not assessed as being due any consequential losses by the bank-led review. He was able to gather together the resources to take his claim to court. It was a £10 million claim, although I am not clear exactly how much he received, as he settled out of court. He was able to settle the claim, whereas most people cannot get the money together to take their claim to court. He had had his claim assessed by the bank and was not happy with it, but because he had the money to get to court, it was settled for a much higher figure. It cannot be right that the only people accessing justice are those with the wherewithal to get to court. Given that imbalance of power, people would need millions of pounds to take a bank to court. It is simply unfair.

The constituent of my hon. Friend the Member for Beckenham (Bob Stewart), Dean D’Eye, came to us about the RBS Global Restructuring Group scheme. He had a property development business and loans to the value of around 60%. He never missed a payment to RBS. He was sold a swap, which damaged his business, but the key moment came when money from a property sale he had made, to add cash flow to his current account, was taken away by the bank and used to reduce debt. According to Mr D’Eye, that broke the agreement and had a devastating impact on his business.

[Bob Stewart (Beckenham) (Con)]

It did not just affect Dean D’Eye but it deeply affected his father, who was almost bankrupted and lost his home.

[Kevin Hollinrake]

Absolutely, and we see that time and time again. It is not just about businesses or jobs—although clearly businesses and jobs are lost—but about the effect on people’s lives. I understand that as a business person myself. My business has been my life. If somebody had taken my business away from me in those circumstances, I do not know how I would have coped.

The Minister may say that many cases are not proven or that the banks may write with various reasons why claims are wrong. That is why we do not put the APPG forward as an arbiter of whether the customer or the bank is right in such cases. We do not think the APPG, the victims or the banks should play that role; it must be somebody entirely independent. As I have said before, we recommended a tribunal approach to solving this imbalance of power. What my hon. Friend the Minister has managed to bring about is something new, called the Business Banking Resolution Service, which we think is a great step forward. We in the APPG have been working with the BBRS for the past year. It will mean that we can look at historical cases and at cases going forward, and at larger businesses too. It is absolutely the right thing, and we believe that the method of adjudication is good.

Our concern is, of course, as I have discussed with the Minister on many occasions, that that approach excludes people who have been through other independent bank-led reviews, which we think is wrong. We think the banks should look at such cases again where there is material evidence that something has not been settled fairly, but with the BBRS as a fallback. We think that is fair, and that should go for all victims of all bank-led remediation schemes who feel there is still a case to answer.

We also think there are other issues that need to be dealt with within the Lloyds Bank Review, certainly on eligibility. The review had very tight restrictions on eligibility: the victim had to have dealt directly with one of the two people convicted of the direct fraud, Lynden Scourfield or Mark Dobson. We think that is an unfair restriction. Lloyds has made ex gratia payments—I think £65,000 in total—that are only allocated to certain people who have been through that scheme or are assessed as being appropriate to go through that scheme, which, again, we think is unfair. Lloyds should look again at that.

We see a lot of people now putting their cases forward for the Business Banking Resolution Services. Our constituents who have these kinds of problem can put their cases forward, and we urge them to do so, but when they do, while their cases are being assessed, we think the bank should declare a moratorium or a stay of proceedings on any cases going through that process.

To conclude, we see this as a crucial opportunity, not only for Lloyds to get this right now, but for the wider business-banking relationship. We are very grateful to the Minister for the steps he has taken, both in appointing Sir Ross Cranston and on the Business Banking Resolution Service. We very much thank Sir Ross Cranston for his excellent work. We see this as a crucial opportunity to restore confidence in the free market system, to ensure that individual victims have access to justice and compensation and to improve the appetite for SMEs to borrow, start businesses and grow them, thereby giving a timely boost to UK plc. Let us ensure that we do not waste the opportunity.

Mortgage Prisoners

Debate between Kevin Hollinrake and Bob Stewart

Thursday 6th June 2019 Commons Chamber

[Bob Stewart]

Mr Deputy Speaker is such a great man. I thought I was being told off earlier.

My comments will be short because I have spoken about this matter and the associated problems many times in the nine years for which I have been a Member of Parliament. Colleagues on both sides of the House are nodding. Why the heck has this matter not been sorted out? We are meant to sort these matters out—we are meant to be the people who legislate to get such injustices sorted and done. We have failed collectively to do that.

In particular, I want to raise the matter of the injustice done to my constituents—to the D’Eye family. Dean, my friend, is somewhere around, but I am not allowed to point him out. An injustice was done to him and his family by these banks. I am referring to Dunbar Bank, part of the Zurich group, and also the Royal Bank of Scotland’s Global Restructuring Group. I just cannot understand it. Decent people run these associations and they are actually—dare I use the word—screwing people utterly and completely, and it is immoral.

[Kevin Hollinrake]

indicated assent.

Business Banking Fraud

Debate between Kevin Hollinrake and Bob Stewart

Tuesday 9th October 2018 Westminster Hall

[Kevin Hollinrake (Thirsk and Malton) (Con)]

It is a pleasure to serve under your chairmanship, Mr Robertson. I, too, congratulate my hon. Friend the Member for Hazel Grove (Mr Wragg) on securing the debate. He is a great advocate on behalf of victims.

I will start with a few words in support of banks and bankers. I have been in business for 25 years, and I could not have achieved anywhere near as much as I achieved without the support of bankers, the vast majority of whom do a good job of supporting the UK economy by offering vital support to businesses. I am sure that most people in the banking world are as shocked as we are by some of the scandals of the last 10 years.

It is critical for us all to play on a level playing field—that is the free-market economy principle. We need to adhere to some basic rules, which must be the same whether someone is a businessperson or a banker. As my hon. Friend the Member for Hazel Grove said, the key principles that we must all adhere to are that justice is blind, no one is above the law, and justice must be done and be seen to be done. Where we are is a mile away from that, because there is so much evidence not just of malpractice and mistreatment, but of fraud throughout the banking sector, particularly in RBS and in Lloyds and HBOS.

For a while, the accusation was that the people who were bringing forward these claims, such as the Turners, were conspiracy theorists—they had failed businesses that could not survive anyway, so it was something that we did not need to look into properly. Then along came the section 166 report into RBS, which clearly identified that RBS had mistreated thousands of businesses. Of course, that report nearly never came out, but when it did it was a critical moment.

It is the same with Lloyds and HBOS: but for the persistence of one or two individuals, the case would never have come to trial and those people would never have been convicted. They are not isolated cases; there was widespread abuse.

[Bob Stewart (Beckenham) (Con)]

I am quite concerned, because I have looked through the banking code of conduct and it seems to mention only banks. Is there any personal responsibility in it, so that the people who make the decisions can be brought to account for them?

[Kevin Hollinrake]

My hon. Friend makes a good point, which I will come to. Interestingly, our campaign, which is supported by so many of the hon. Members present, is also supported by some interesting people. Gordon Brown, the former Prime Minister, has said that he fears another crash because the bankers have no fear of imprisonment—the personal accountability that my hon. Friend referred to. Andrew Bailey of the Financial Conduct Authority expressed real concern in a recent newspaper article that no one

“has been banned as a consequence of the financial crisis.”

My hon. Friend is absolutely right, because the problem goes beyond mistreatment. We have seen evidence of forged signatures, manipulated valuations, manufactured covenant defaults, asset acquisition opportunities being sought out, and conflicts of interest almost everywhere we look. That includes the case of Julia Davey, who is present today.

Julia Davey is one of the most successful businesspeople in the UK, but Lloyds and KPMG forced her into the business support unit. David Crawshaw of KPMG was the independent reviewer of the business, the consultant advising the business and the administrator to the business. How can that be right? That multimillion-pound business was taken down by a £100,000 utility bill, when there were ample moneys in the bank. That money was used to pay the advisers, not the debt. It is outrageous.

The banks’ default position has been denial all the way. When Lawrence Tomlinson first established that there was abuse, they tried to withdraw the funding for his business to keep him quiet, which is a disgrace. Throughout the section 166 report, there is clear evidence of malpractice that goes beyond simple mistreatment and into fraud. The same is true for Lloyds and HBOS. The regulators’ attention was drawn to the fact that the abuse was going on thousands of times, but there has still been no action.

The FCA still says that the banks must be trusted to run their own internal redress schemes for the abuses. At Lloyds, the Griggs review is an internal scheme with no independent verification of the settlement that is made. At RBS, the situation with Sir William Blackburne’s review is similar. I do not dispute the fact that they are honourable people, but how can justice be seen to be done if these matters are decided internally? It cannot be right. What if those people, who are working internally for those banks, find evidence of fraud in their investigations? Would they put it in the shredder or would they hand it to the police? I will leave that for those in the Chamber to decide.

We need action. We need regional fraud squads and a twin-track approach, so that the Serious Fraud Office works with the Financial Conduct Authority, as happens in the US. There has to be criminal liability for the failure to prevent economic crime, as we have for the failure to prevent bribery and tax evasion. We need to introduce conduct of business rules to SME banking, so that regulators have a basis on which to judge a claim. We need our financial services tribunal and a public inquiry. There are 12 separate inquiries and counting into various parts of the banking system—a piecemeal approach to a systemic problem. We need cultural change. We need to restore faith in the system. Justice must be blind. No one is above the law. Justice must be done, and justice must be seen to be done.

--- Later in debate ---

[Bob Stewart (Beckenham) (Con)]

I think I have spoken in all four debates on this subject, and I am beginning to feel like my colleagues: we are voices crying in the blooming wilderness. We have asked for something to happen, and nothing is happening. It is wrong. It is scandalous that decent people have been so incredibly robbed by banks. I cannot understand why we have not been able to get a grip on this matter and sort it out. It is wrong, and we are meant to be the people who sort these sorts of problems out.

One part of National Westminster is particularly to blame. One of my constituents, Dean D’Eye, started an association with that bank’s Romford lending branch in 2000. For eight years, it was all great. That association worked well, and both the bank and the business were profiting, but just after the banking crisis 10 years ago, the destruction of Mr D’Eye’s investment and property development business began. At that time, his company was worth about £11 million and had a debt of about £5.8 million. All his interest payments for debts were on time, and he had a gearing ratio of 60%, which was pretty good.

However, in September 2008, Mr D’Eye began to be inundated with requests for information, which took up a great deal of his team’s time and stopped them doing business. Then, in December, the National Westminster bank suddenly robbed £139,000 from the company’s business accounts, without any reference to Mr D’Eye and despite letters from the bank saying that money could be used by the company. In early 2009, the demands for more information continued, and Mr D’Eye’s group was placed under the watch of that wonderful organisation called the Global Restructuring Group. The situation then grew rapidly worse: suddenly, in April 2009, the bank appointed administrators, who appeared to investigate the business. On 28 May 2009, NatWest formally cancelled Dean D’Eye’s overdraft. Considering the size of the businesses, that overdraft was pretty small, at £40,000.

Within a week, on 1 June, all Dean D’Eye’s loans were called in. By 10.17 am on 5 June, administrators had full control of his companies and were effectively running those businesses from his offices. That decision meant the group lost its cash flow, which in turn created a default with the Dunbar bank, owned by the Zurich insurance group. Dunbar bank has a pretty bad reputation, and is often more ruthless than anyone else.

My constituents, the D’Eye family, have lost their family home, and Mr D’Eye has lost his father’s house as well. Mr D’Eye continues to hope that he can get litigation funding to take NatWest to court for the way it has ruined his business. Who can blame him? A generation ago, banks usually encouraged and supported their customers, giving them a fair shake. How tragic is it that that is no longer the case for so many people?

[Kevin Hollinrake]

My hon. Friend is making an excellent speech. He said earlier in his remarks that Mr D’Eye was not behind on his payments when the bank first took action. My hon. Friend may be aware that Australia has brought forward a royal commission because of similar abuses there, and one of the changes that has come out of that process is that a bank cannot take action against a business if that business is not behind on its payments. Does that not underline the need for a full public inquiry?

[Bob Stewart]

I thank my hon. Friend for that very good point. Of course it does. We need to get on and sort this matter out.

In the 18th century, highwaymen used to stop coaches, get people outside them and say, “Stand and deliver. Your money or your life.” Those guys had a choice. Now, the 21st century equivalent of highwaymen—some in the banks—shout, “Your money or your lifestyles”, and they take both. Thank you, Mr Robertson.

Parental Bereavement (Leave and Pay) Bill

Debate between Kevin Hollinrake and Bob Stewart

2nd reading: House of Commons
Friday 20th October 2017 Commons Chamber

[Kevin Hollinrake]

My hon. Friend is absolutely right. Of course, most employers do the right thing, working with the people affected so that they get whatever support and time off they need, and maintaining their levels of pay through that period of time.

During our consultations on the Bill, our excellent parliamentary digital engagement team facilitated a Facebook debate, in which I took part. Some charities and the campaign organisation, 38 Degrees, also provided us with a number of examples of employers and line managers who offered inappropriate levels of support. For instance, a parent told us that their employer— an NHS body—offered them only five days’ leave following the sudden passing of their youngest daughter, with any additional time having to be taken as annual leave. Brendan from Newcastle told us that he did not get any paid leave and was sacked nine months later. Gillian from Milton Keynes did not receive the appropriate support when she lost her daughter 13 years ago. She told us that the measures proposed in the Bill would have meant that she and her partner could have grieved together, and provided help and support for their other children.

No employee should even have to think about being at work when they desperately need some time away to grieve for a lost child. Yet according to a Rainbow Trust survey, around 9% of parents said that their employer was not at all supportive. I ask those employers to consider their position. What is the point of having a parent in the workplace who has had no time off to grieve? What effect do those employers think it has on the bereaved parents’ attitude to their workplace and, indeed, on other people in the workplace? I strongly recommend that all employers and managers read the excellent ACAS guidelines on bereavement, which clearly detail best practice for financial and emotional support.

I will now set out the detail of the Bill. The Bill will provide two weeks’ leave for all employees who lose a child below the age of 18. This will be a day-one right. Those key points are established on the face of the Bill, which deliberately leaves some other details to regulations. This leave will be protected and a person should suffer no form of detriment in the event that they find themselves having to take the leave. Crucially, the Bill will give parents an important choice, allowing them to make a decision on what is best for their needs, when they might otherwise be reliant on the good will of their employer.

[Bob Stewart (Beckenham) (Con)]

I am very, very happy to say that it has never happened to me, and I grieve for all those to whom it has happened. I have heard of other cases where young men and women have been killed, and sometimes the parents do not want to stop working. They do not have to stop working if they feel that continuing may be better in helping them to get over the loss.