Autumn Budget 2024

Lord Berkeley of Knighton Excerpts

Monday 11th November 2024 Lords Chamber

[Lord Berkeley of Knighton (CB)]

My Lords, I start with a few notes of welcome to the noble Lord, Lord Booth-Smith.

On the Budget, I was very pleased that the Government have put aside money for the compensation of victims of those outrageous goings-on at the Post Office and to do with infected blood. In fact, to be honest, I felt ashamed to be part of, if you like, the establishment—an establishment that failed to pick up these bills while these poor people suffered so appallingly. I am very pleased that this will be put right.

I am pleased that there will be more teachers, and I hope that will be very much in the arts and music. I am delighted that the Prime Minister plays the flute. But—here is the first but—VAT on specialist schools is going to be a real problem. I ask the Government to look at that particular part of education again. If we have the teachers to create aspirations in things such as the arts, then we need to look to small venues and museums, which at the moment are about to fall by the wayside if they are outside London.

I agree with the Labour Party that the wealthy must do their bit to help those who are less fortunate, but sometimes I think there is a misunderstanding. I could not agree more with my noble friend the Duke of Wellington, who so pointedly showed how the Treasury has a fundamental misunderstanding about the economics of small and medium-sized agriculture. I declare an interest, as I have built up over 40 years, field by field, a farm with a local family, all of whom have to go out and do contract work to make ends meet.

Farms of the kind of size that my noble friend the Duke of Wellington mentioned do not make much money; they hardly make any. What I think has not been understood is that, if you have to sell something like 30 to 50 acres to pay the inheritance tax on a farm of 250 or 300 acres, you are making that farm less viable. It is impossible to make a living off, for example, 100 or 150 acres. You need these bigger farms. Therefore, my noble friend the Duke of Wellington is quite right to ask the Minister to think about raising that cap, because otherwise he will be punishing precisely those he wants to help—those who have less.

We have heard the Opposition Benches agreeing with the Government that it is people that create growth. If we want to help people to create growth, we must not cut the ground from under them. What could happen with this tax, unless this is changed, is that it could kick-start a vicious circle where, in order to pay inheritance tax, part of the farm is sold; the farm then becomes unviable and therefore bigger landowners will snap it up if they can. One farmer said to me, “How much is this going to raise?” I said, “On the Government’s figures, £500 million”. He said, “Well, why don’t they put a penny or two on petrol?” That would solve the problem, without completely ruining a whole level of farming in this country, which is vital.

I can understand why the Government would want to stop people putting millions into land to save inheritance tax. Like my noble friend the Duke of Wellington, I agree that you want to stop that. But surely, as with the winter fuel allowance, the Treasury must be able to come up with formulas that actually mean that the top strata pay but the lower strata do not. I cannot believe it is beyond the wit of man, or woman, in the Treasury to come up with a formula which would tax those who were seeking just to avoid inheritance tax, without punishing those who are working hard every day on the land to provide food for this country. Do we dare risk that?

Crown Estate Bill [HL]

Lord Berkeley of Knighton Excerpts

Report stage
Tuesday 5th November 2024 Lords Chamber

[Lord Morgan (Lab)]

My Lords, I will not take up much time, but very much agree, in general and in detail, with the remarks of the noble Lord, Lord Wigley, and many other noble Lords who have spoken. There is a detailed matter and a more general principle which justifies this form of devolution to Wales. The environment in Wales is exceptionally important and the estates referred to are central to the economic and social life of Wales. More generally—I echo what we have just heard—the whole history of devolution in Wales has been a very slow process and the battle goes on. In the mid-19th century, it took the form of political demands from the Liberal Party in Wales. The Labour Party provided devolution and other parties have taken up the baton in that way.

The history of devolution in Wales has for a long time been a sluggish process. It has not arisen with the buoyancy that we have had, perhaps not always happily so, in Scotland and Ireland. The Barnett formula indicates how Wales has been treated—in an indirect and offhand way—and this is a valuable addition to it. Given the happy congruence of government in Wales, the United Kingdom and Northern Ireland, we would like a full embrace of this, bracketing the Welsh Government and the devolutionary process emerging from Westminster. Wales has suffered for a long period from a kind of half-colonial attitude towards the nation. This is an excellent example of a way in which that could be reversed.

[Lord Berkeley of Knighton (CB)]

My Lords, as someone who lives and farms in mid-Wales as well as writing music, I support this amendment. Living among people there, to me it seems that the comments we have just heard are very apposite. There is a feeling that we are slightly out on a limb and that, if devolution is to mean anything, this is a perfect example of where some empowerment could take place and, as the noble Lord, Lord Wigley, said, we could see a certain amount of money returned to Wales to help with the preservation of all those things that people value there, not least the coast and countryside. We are threatened with all kinds of things—possible massive pylon building and massive problems with the Wye, which has been coming up today in various amendments. To be able to decide for ourselves, or for the Welsh Government to be able to decide on our behalf, seems an extremely important point in this debate. Therefore, I very much support the amendment.

[Lord Livermore (Lab)]

My Lords, I am very grateful to all noble Lords who have spoken in this debate in response to the amendments from my noble friend Lord Hain and the noble Baroness, Lady Humphreys.

Turning first to Amendment 11, tabled by my noble friend Lord Hain with my noble friend Lord Murphy speaking on his behalf, I thank my noble friend Lord Hain for his constructive engagement on this topic and thank other noble Lords across the House who have spoken in favour of this amendment, which the Government support. The amendment requires that the board of Crown Estate commissioners must include a commissioner who is knowledgeable about Wales and that such a commissioner, alongside their existing responsibilities, must be responsible for giving advice about Wales to the board. It also requires equivalent positions for Northern Ireland and England and grants Welsh Ministers and the Executive Office in Northern Ireland the right to be consulted about the Welsh and Northern Irish appointments. These legislative requirements will ensure that the board of commissioners continue working in the best interests of Wales and Northern Ireland alongside their existing duties as commissioners. To answer the noble Baroness, Lady Humphreys, I say that I do not believe that the amendment in any way deliberately excludes the seabed.

I reassure the noble Lord, Lord Wigley, that the Crown Estate absolutely welcomes the opportunity presented by the increase in the number of commissioners from eight to 12, to bring knowledge of the devolved nations even more directly to the board table. It is an enthusiastic supporter of this amendment. This will supplement the expertise of its director for the devolved nations, who is based in the Crown Estate’s recently opened Cardiff office and whose knowledge and extensive local engagement over the last two years is evidence of the importance to which it attaches understanding local conditions in Wales.

The commissioner responsible for giving advice to the board on Northern Ireland will provide valuable insight as the Crown Estate’s engagement and activities in Northern Ireland continue to evolve. For example, the Crown Estate’s chief executive was in Belfast last month meeting officials and Ministers from the Department of Agriculture, Environment and Rural Affairs and the Department for the Economy. That form of engagement will move from strength to strength with the knowledge that such commissioners will offer to the board. These commissioners will certainly strengthen the Crown Estate’s ability and mission to deliver benefit for the whole UK at a time when devolution of the estate would significantly risk fragmenting the energy market, which would undermine international investor confidence and delay the progress towards net zero by an estimated 10 to 20 years, to the detriment of the whole UK.

Amendment 6, tabled by the noble Baroness, Lady Humphreys, would require the Treasury to complete a transfer of the responsibility for the management of the Crown Estate in Wales to the Welsh Government. As I have set out previously, the Government’s position is that there is greater benefit for the people of Wales and the wider United Kingdom in retaining the Crown Estate’s current form. As I set out in detail in Committee, the Crown Estate Act 1961 requires the Crown Estate commissioners to manage the Crown Estate as a commercial enterprise and with due regard to the requirements of good management. While the Crown Estate has goals which, under its own strategy, align with wider national policy objectives, the 1961 Act provides the Crown Estate with independence and autonomy to set and achieve its goals. It has shown itself over the last 60 years to be a trusted and successful organisation with a proven track record in effective management.

The Crown Estate is required to place profits into the UK Consolidated Fund each year, worth more than £4 billion over the past decade. This enables those revenues to fund UK government spending in reserved areas in Wales and Northern Ireland and supports the funding provided through the block grant. Those revenues are then allocated to public service priorities by the Government, subject to the usual parliamentary controls. As I have noted previously, that is a valuable outcome which we must be careful not to undermine. Devolving the Crown Estate to Wales would, as I have explained, most likely require the creation of a new entity to take on the role of the Crown Estate in Wales. As I have previously set out, this entity would not benefit from the Crown Estate’s current substantial capability or capital and system abilities, nor benefit from the Crown Estate’s marine investments currently being made on a portfolio-wide basis across England and Wales. To devolve to Wales would disrupt these existing investments, since they would need to be restructured to accommodate a Welsh- specific entity.

I will not repeat the examples that I gave in Committee, but it remains the point that to devolve at this time would risk jeopardising the existing pipeline of offshore wind development in the Celtic Sea, planned into the 2030s, and the vital investment and jobs that this would bring across south Wales. As I noted in Committee, in addition to energy, the extensive jobs and supply chain requirements of the round 5 offshore wind opportunity in the Celtic Sea would also likely deliver significant benefits for Wales and the wider UK. As I mentioned in Committee, an advisory firm to the Crown Estate estimated that manufacturing, transporting and assembling the wind farms could create around 5,300 jobs and a £1.4 billion boost for the UK economy.

Devolution would also delay UK-wide grid connectivity reform. For Wales, the Crown Estate is working in partnership with the energy system operator to ensure that its current pipeline of Welsh projects, the biggest of which is round 5—which is expected to contribute enough energy capacity to power 4 million homes across the United Kingdom—can benefit from this co-ordinated approach to grid connectivity up front. Introducing a new entity, which would have control of assets only within Wales, into this complex operating environment where partnerships have already been formed, would not make commercial sense. A devolved entity would be starting from scratch midway through a multi-million-pound commercial tendering process when the Crown Estate is undertaking critical investment in the UK’s path towards net zero. I therefore respectfully ask the noble Baroness, Lady Humphreys, to withdraw her amendment.