Essential Services: Large-scale Technology

Lord Stevenson of Balmacara Excerpts

Tuesday 12th January 2021 Lords Chamber

[Lord True (Con)]

My Lords, at my level in Government I will not comment on the final part of the noble Lord’s question. He is right that malign cyber activity, including by states, is an ongoing concern. In the Cabinet Office and across Government we are maintaining our capability to respond to major cyber incidents, and the National Cyber Security Centre and law enforcement cyber specialists are active in supporting critical organisations in the UK, including outside government.

[Lord Stevenson of Balmacara (Lab) [V]]

My Lords, the Ipsos MORI research on understanding the full cost of cyber breaches, published by DCMS last year, points out that the current lack of accurate data makes it very difficult for SMEs in particular to get insurance for such events. Will the Government consider backing a cyber breach reinsurance scheme, based on the successful Pool Re and Flood Re reinsurance schemes, over this interim period?

[Lord True (Con)]

My Lords, once again this is slightly outside my area of responsibility, but the interests of SMEs are always of great concern to the Government and I will pass the noble Lord’s suggestion on to appropriate colleagues.

EU-UK Trade and Cooperation Agreement

Lord Stevenson of Balmacara Excerpts

Friday 8th January 2021 Lords Chamber

[Lord Stevenson of Balmacara (Lab) [V]]

My Lords, it seems a long time ago—indeed, it was a long time ago—but I thank the Minister for his original introduction, which was well balanced and got us off to a good start. This has been a rapid-fire debate and, like others, I hope we can find a better way of debating big issues in future, otherwise we will seriously diminish the reputation of our House. Having said that, I thank all speakers—not just for participating today and for their interesting points, but for sticking to the time limits, which was incredible. I join others in welcoming the noble Lord, Lord Wharton of Yarm. I also thank the Library for its very helpful briefing notes on the debate.

The TCA is a complex and extensive agreement and, as others have pointed out, it has a large overhang. Issues such as data adequacy and the urgently needed memorandum on financial services still need to be resolved. There will be ongoing discussions through a partnership council, a plethora of specialist committees and bodies on issues arising, including the Northern Ireland protocol, and a joint parliamentary committee. The TCA provides provisions for a review of the deal every five years.

Every senior politician knows that one of the keys to their success is the ability to shut down debate on issues likely to harm them later. I take it from this debate that the great majority of those who have participated accept the need to draw a line over the recent past and move on, but I wonder whether this will be possible in practice. I suspect that we will be dealing with the aftermath of this deal for some time to come.

The main topics that have been raised today have centred on a few issues, to which I am sure the Minister will respond. We have heard a lot about the problems that have already emerged in the tariff-free and quota-free trade in goods. I look forward to his response to the issues raised on rules of origin and the worrying lack of a deal on diagonal cumulation, which will have a huge impact on manufacturing value chains. We need to hear more from the Minister on why services have largely been ignored and particularly why UK service suppliers will no longer benefit from country of origin principles, mutual recognition or passporting. The noble Lord, Lord Teverson, deserves a full response to his devastating analysis of the fisheries agreement.

Several noble Lords, including former Home Secretaries such as my noble friends Lord Blunkett and Lord Reid, raised law enforcement co-operation and particularly that the UK will lose access to the Schengen Information System and not be a member of Europol. I look forward to the Minister’s response to that. Although it has not been given much attention today, the level playing field agreement includes certain provisions to prevent distortions to trade and investment—for example, through subsidies or reductions of labour or environmental standards. This is a live issue, as it features in amendments to the Trade Bill made this week. Can the Minister explain how this is going to operate in practice and if there will be a need to create new institutions? If so, will that require further changes to the Trade Bill?

It is interesting that the issues that were raised by noble Lords most often in this debate were the departure from the Erasmus+ programme and the inadequacies of the proposed Turing scheme; and, despite assurances given by Ministers, the failure to negotiate a procedure for our creative industry practitioners, particularly musicians and performers, and young entrepreneurs to travel easily in the EU and vice versa. Blaming the EU does not ring true here and I hope that the Minister can give us some real hope that these matters will be resolved.

Finally, I end on the opportunity that some, including the noble Lords, Lord Bridges, Lord Birt and Lord Greaves, and the noble Earl, Lord Caithness, suggested we now have to focus on the future. There may not be agreement on where exactly it might lead us, but we surely can agree that, post pandemic, there is an opportunity to sort out some of the long-standing and apparently intractable problems we face as a country. My list includes using a green recovery to ensure further strengthening of the union, improving productivity, investing heavily in 5G and gigabit-enabled internet for all, improving transport linkages, combining health and social care, modernising the core curriculum, having proper regard for apprenticeships, improving housing standards, and better balancing the immigration policy. This will deal with some of the issues raised during this debate. As was observed by the noble Lord, Lord Holmes of Richmond, we are clearly at a turning point. We should work together as a country to ensure that this is a truly transformative experience.

United Kingdom Internal Market Bill

Lord Stevenson of Balmacara Excerpts

Consideration of Commons amendments
Monday 14th December 2020 Lords Chamber

Moved by

[Lord Stevenson of Balmacara]

At end insert “and do propose Amendment 8M as an amendment to the words restored to the Bill by non-insistence on Amendments 8L, 13 and 56—

8M: Schedule 1, page 48, line 47, at end insert—


“5A (1) The United Kingdom market access principles do not apply to, and sections 2(3) and 5(3) do not affect the operation of, any requirements which—


(a) make a contribution to the achievement of—


(i) environmental standards and protection, or


(ii) protection of public health,


(b) are a proportionate means of achieving that aim, and


(c) are not a disguised restriction on trade.


(2) For the purposes of subparagraph (1)(b), a requirement is considered disproportionate if the aim being pursued in the destination part of the United Kingdom is already achieved to the same or a higher extent by requirements in the originating part of the United Kingdom.””

[Lord Stevenson of Balmacara (Lab) [V]]

My Lords, in moving Motion B1 in my name, I thank the Minister for his full and comprehensive introduction and make it clear that we agree with his Amendment 15C, which we think is very helpful to the overall operation of the internal market Bill. In particular, it picks up points that we have been making in relation to market access. I have just one point of correction to what he said: the changes set out in my Amendment 8M remove the amendment completely from the main part of the Bill. He said Clause 1, but I think he meant Schedule 1; in other words, even more disguised and hidden than perhaps was the impression he gave when speaking.

In opening this debate, I do not want to spend a lot of time on this issue, which is quite narrow. Indeed, the arguments are very similar to those we have already heard from the noble and learned Lord, Lord Hope. The Minister’s defence of the current drafting in the Bill depended largely on the often-used threat by Ministers that those who are preparing amendments do not understand the unintended consequences that might flow from their drafting. I suggest to the Minister with some humility that we are not the experts on drafting. If there is an issue here that we should progress a little, we would certainly be happy to work with him and the team of draftspeople in his department to try to make sure that any egregious issues are removed. He drew particular attention to a concern about the phrase used in proposed paragraph 5A(1)(c), which those who wish to bring forward changes to market access would not be permitted to do so if they were disguised restrictions on trade. As I understand it, that comes from the existing WTO regulations and is therefore relatively well understood among those involved in the operation; these are trivial points, however, compared to the main points of principle that he raised.

I want to make three main points. The noble and learned Lord, Lord Hope, has already explained in his amendment that the common frameworks issues he talked about require a market access regime as well; the two are interrelated—almost two sides of the same coin. The devolution settlement has to be observed in both the spirit and the letter of the law. We think that the Bill can both honour and enhance the devolution settlement, provided, first, that we emphasise the common frameworks and the coherence that they can bring to the whole process of a devolved settlement and, secondly, that we do not make the market access principles, which operate automatically, too narrow and too prescriptive. That would fatally undermine the opportunities for devolved Administrations to diverge—if they wish and as agreed by all concerned—in a managed and coherent way.

We have a devolved system of government. That must necessarily imply divergence, so it has to be part of the system. In some way, the argument revolves around how it is possible to frame that managed divergence in legal terms. My Amendment 8M uses derogation powers that are already in the Bill to highlight areas of public good that could benefit consumers, workers and traders. The Minister said there was already coverage on these areas within the Bill, so, in a sense, he is making my point that areas such as public health and the ability of people to work in the environmental areas will be public goods if they can be brought forward. Any sensible Government would ensure that the system made it possible for those who wish to make changes that would raise standards —managed and with agreement—to do so.

The amendment therefore enhances efforts to improve environmental standards and public health; I cannot believe that the Government would want to be against that. It amends a schedule, and does not change any of the main clauses in the Bill. We are talking about trying to find a system for allowing divergence to happen in a proportionate way, which will not in any sense damage the ability of traders to trade but will benefit consumers and workers. It is a very small change. As the Minister rightly said, it has been slimmed down in the process of arriving at this point in the Bill’s discussions, and it is very much tied to the amendment that we have just accepted by a majority of over 100 in relation to the common frameworks. I beg to move.

[The Deputy Speaker (Baroness Henig) (Lab)]

The question is that Motion B1, as an amendment to Motion B, be agreed to. I have had no notice of anyone in the Chamber wishing to speak—in fact, I call the noble Baroness, Lady Bennett.

--- Later in debate ---

With that explanation, I hope that noble Lords will be able to support the Government’s approach—the noble and learned Lord, Lord Falconer, looks sceptical—to reinstate these original clauses on exclusions in the Bill.

[Lord Stevenson of Balmacara (Lab) [V]]

My Lords, this has been a very short debate, but, as the Minister has said, it has been quite interesting, and revelatory in some senses. I thank the noble Baroness, Lady Bennett, for speaking in support. I think that I thank the noble Lord, Lord Fox, for his suggestion that “yin and yang” are the words I was looking for in terms of my relationship with the noble and learned Lord, Lord Hope. We are certainly not yin and yang if you consider size or intellectual ability, but, even so, it is a nice thought.

I recognise that the Minister was not going all out to take down the arguments I was making, and I am grateful to him for that; he can sometimes be quite destructive when he does, and it is nice to have the sunny side of him on show today—he does have a sunny side.

I cannot understand why there is such a concern about divergence. For those of us who were born and brought up in Scotland, it is well known that building regulations there are substantially different for not unreasonable reasons: the weather up there is so different from that which one experiences further south. Those regulations were different in Scotland for many years before devolution took place, and have continued to be.

Of course, there are many other areas of difference, right across a range of activity in Scotland: a different legal system, a different religious environment as well as other factors. This has led to different ways in which people operate, trade is conducted, and people shop and carry out their business. The idea that divergence is not already present in the system and not respected as such seems very strange.

I know that the Minister stands by Schedule 1 because he referred to it at length, but those who have read it carefully—I suspect that not many people have read it right the way through because it is dry—will know that, basically, the only real reason for divergence is set out there very clearly. It says that there has to have been a threat to life caused by a “pest or disease”—that is a very wide-ranging thought and a way we can approach it. Nevertheless, that is really the only sure and certain basis under which divergence would be permitted, other than that which already exists.

In that sense, we are on the right track: there could be a better way of formulating that. The schedule contains many other ways of implementing curtailment and restriction that we could use if the wording currently in our amendment is not satisfactory. However, I do not think that the Minister has said anything that would negate our feeling that this amendment, in its essence, is the counterpart to the amendment that we already agreed in relation to common frameworks—and that it would play a necessary part in making sure that devolution continues. I recommend it, and I would like to test the opinion of the House.

[The Deputy Speaker (Baroness Henig) (Lab)]

Members taking part remotely have given their voices in support of this Motion, and I will take that into account.

--- Later in debate ---

[Lord Fox (LD)]

There is almost no one left in the Chamber who has not spoken. This has been an interesting debate and, no doubt, the Minister is carrying away lots of advice from some of the Benches. I thank the noble Lords, Lord Adonis and Lord Liddle, for their passion. If that passion is matched by votes in the event that the noble and learned Lord, Lord Thomas, decides to ignore the advice of the noble Baroness, Lady Noakes, and press this to a vote, I will have more excitement because otherwise, it is merely a rhetorical gesture.

The noble and learned Lord set out his view on devolution. It is quite clear, as was set out a number of occasions, that in the structural fund process, which this will herald the replacement for, the devolved authorities were in the driving seat of deciding where and on what the money was spent. It is not clear from anything the Minister said today, or in answer to questions last time, that the Government will not seek to impose things on the devolved authorities. The Minister said there would be governance structures; it would be interesting to hear how those governance structures will be introduced and what the Government envisage. In other words, do central Government have the veto in deciding what goes where? In the end, that is the difference between this being genuinely consultative and, as we have heard described around the House, a Westminster-knows-best process. Consultation is fine but only if it is adhered to.

My final point on the quantum of money and its distribution comes back to a question I asked earlier. I think the Minister said that the amount of money envisaged to go into the shared prosperity fund is equivalent to that which came through the structural fund. The Minister also indicated a much broader remit for spreading that money around than was the practical reality of the structural fund. How will the Government manage the process of certain areas that have been particularly well funded through the structural fund, such as Cornwall and Wales, getting less money if there is no increase in funds and they are spread more widely? Furthermore, the European Union distributed that money using classifications of need, so how will the UK Government develop those? Do the Government envisage that they will be different, and can they undertake that they are transparent?

In conclusion, if the noble and learned Lord, Lord Thomas, decides to call a vote, we on these Benches would support it, but there are a lot of questions we would be grateful if the Minister could answer.

[Lord Stevenson of Balmacara (Lab) [V]]

My Lords—[Inaudible]—on earlier discussions around this issue and the issue that will come up in the next group of amendments on state aid and spending as a result of moneys which may be available to support that. We should pause and take note of the fact that the noble and learned Lord, Lord Thomas, has engaged with this issue again despite the view taken in the other place that it is a financial privilege. The noble Baroness, Lady Noakes, is right in saying we are in a difficult area. I am not sure how the comments from the noble and learned Lord, Lord Thomas, will take him forward. He certainly has a point, but I do not think this is the right amendment or place to explore it. It needs a wider perspective. Many of these issues date from time immemorial; it is important to respect them and understand where they come from, but they should not block debate and discussion on key issues.

The issue the noble and learned Lord is raising, which has also been picked up the Minister, is how, in the future, possibly using statecraft—whatever that is—we will manage spending in the devolved areas, which are not reserved, when the funding mechanisms are different and have to be adapted to meet current arrangements. There are issues that will need to be addressed in the future, but we covered a lot of ground in earlier debates, and I thought the points made by the Minister on the shared prosperity fund were sufficient to ensure that we do not need to go back over this again. It is not our view, as Her Majesty’s loyal Opposition, that we need to divide the House on this issue again.

If the issue is common between us, we need to understand where we can get to in respect of comments made from the Dispatch Box. The noble and learned Lord, Lord Thomas, made a number of good points and asked a number of questions, and I am sure the Minister will respond to them. I do not think the points added by my noble friends Lord Adonis and Lord Liddle vitiate that approach; they made a good case that we will need more in this area in the future, but this is not the right amendment to take us down that route.

--- Later in debate ---

[Lord Stevenson of Balmacara (Lab) [V]]

My Lords, I agree with others who have spoken that this has been an interesting debate. It is clear that good discussions have taken place between Ministers and the movers of the amendments, which is a good sign and reflects changes.

The Government have made a concession and a commitment to extensive consultation prior to bringing forward proposals for their state aid regime. That is a major change compared to where we were at the start of this Bill, which we welcome.

Like the noble and learned Lord, Lord Thomas, we agree that control of state aid and the regime which underpins it must lie at the UK level, but, as we discussed when debating a recent regret amendment to the statutory instrument referred to by the Minister, we think that policy development in this area has been quite bizarre. How on earth Parliament is expected to opine on state aid rules without first knowing what those state aid rules might be—whether we are continuing where we were, whether we are changing to WTO or whether it is somewhere in between—is beyond me; it is not the way we normally do things, as we made clear in that debate. I imagine, and it has been said by others, that it is because this issue is still at the heart of the never-ending discussions in Brussels about the future of the EU free trade agreement. We may begin to see progress once that is resolved, but we are where we are, and we are moving to World Trade Organization rules—much discredited—on 1 January and have yet to consult on an appropriate state aid regime. This is not the way we should do things.

However, we on this side of the House accept that Ministers have given assurances at the Dispatch Box, and they have been repeated today, that spending on state aid, as opposed to the control of policy on it, is an issue that has to respect the devolution settlement. It needs to be done in a way which brings forward the consultation and the seeking of consent that have been discussed by just about everybody who has spoken today. However, a final assurance from the Dispatch Box is required to take the trick on this matter. If the Government repeat that they will make every effort to work consultatively and seek the consent of the devolved Administrations, I do not think that this is right amendment on which to divide the House on this issue or the right time to do it, so we would not support that.

The noble Baroness, Lady Bowles, on the other hand, is moving ahead of the game, looking to future changes and asking how they would be introduced. She is right that these are big decisions that need to be thought through very carefully. If they are to be slipped through in some form of secondary legislation, they will not achieve the scrutiny and debate that they should. She makes some good points about that, and about the gap that will emerge if there is no primary legislation, let alone the need for consultation and discussion with those who have to implement the legislation once it is brought in. Although I discussed it with the noble Baroness prior to this evening’s debate, I suspect that this amendment has been picked up too late to be included in the Bill at this time. As she said, however, it would be good to hear the Minister set out his plans at the Dispatch Box. Again, if he does so, I would not be prepared to divide the House on this issue.

[Lord Callanan (Con)]

My Lords, I have once again listened carefully to the points made in the debate today. It is always particularly entertaining to listen to the noble Lord, Lord Adonis, who has once again benefited us with his Brexit prejudices. I give some advice to the noble Lord: he just needs to accept that we had a referendum on this subject as well as a general election that was mainly devoted to it. He really needs to use his considerable talents in other areas and get on with his life. The issue is settled; we are leaving the European Union. I respect his ideas and opinions, but he lost. As a Conservative from the north-east, I know when I have lost an election, and there have been plenty of them in the past.

Regarding devolution, in my previous job I chaired the Joint Ministerial Committee with the devolved Administrations on ongoing EU business. I attended many meetings with both Scottish and Welsh Ministers. Of course, we did not always agree on the outcomes or the issues, but we certainly had a very good personal relationship. I listened to their concerns very closely, as indeed they listened to mine; as I said, we had a good working relationship.

I reiterate, first, that I welcome the shared consensus in this House to continuing the UK-wide approach to subsidy control and confirming this in law. While I am grateful for the time and the effort that has been devoted to scrutinising this provision as is right for your Lordships’ House—perhaps too much time and effort, but we are where we are—it is important to note that we have asked the other place, the elected Chamber, to think again on the relationship between subsidy control and common frameworks. It has been clear that subsidy control does not fall within the common frameworks programme, and that any undue delay is not something to be supported. I hope that noble Lords will be able to respect that decision. I recognise the concerns of the Welsh and Scottish Governments, but I reiterate that the noble Baroness’s amendment is not the best way forward. This amendment is inconsistent with the reservation clauses that both Houses have now agreed should remain in the Bill.

I also reiterate that state aid has always been reserved and, as such, has never been part of the common frameworks programme. This amendment seeks to reverse a decision which has already been made. We need to move forward on this issue as I have indicated, and this will be done through the forthcoming consultation.

The noble Baroness, Lady Finlay, asked me for an assurance that we will make every effort to get devolved Administrations’ support. Amendment 51B demonstrates that the Government are committed to maintaining a constructive, collaborative relationship with the devolved Administrations, as it is in all our interests to ensure that a new regime works for the whole of the United Kingdom. We hope that this amendment will enable us to discuss and resolve any such issues before the publication of any consultation response, and we will commit to listen very carefully to the devolved Administrations’ concerns.

We all agree that the UK Government and devolved Administrations should work constructively and co- operatively in this policy area. That is why, as I have said, the UK Government have set out an amendment that commits to consulting them. The amendment ensures that, before publishing any relevant report relating to the outcome of the UK subsidy control consultation, the Secretary of State will provide a draft of the proposed response to the devolved Administrations, inviting them to make representations. The Secretary of State will then consider any representations and determine whether to alter the report in light of that consideration. If after all that we decide to legislate, it will, of course, come to this House.

This process will ensure that the devolved Administrations’ voices are heard, but it avoids creating the unnecessary delays and confusion that a legislative requirement to try to agree a common framework would introduce. Potentially waiting 18 months for a UK-wide system to be agreed would create uncertainty for UK businesses and damage our efforts to promote the UK’s economic recovery. For these reasons, I respectfully suggest that the approach put forward in the amendment from the noble Baroness, Lady Finlay, is not appropriate at this time.

EU: Non-financial Services

Lord Stevenson of Balmacara Excerpts

Wednesday 2nd September 2020 Lords Chamber

[Lord True (Con)]

My Lords, the people of the United Kingdom voted to leave the single market. The Government have tabled proposals in a number of the areas that the noble Baroness referred to, and I have commented on the reasons for some of the current difficulties in making progress.

[Lord Stevenson of Balmacara (Lab) [V]]

My Lords, further to the question from my noble friend Lord Whitty, what assessment have the Government made of the concerns raised by the chair of the DCMS Select Committee about the impact on any adequacy agreement on personal data if the mooted free trade agreement with the US includes Section 230 of the US Communications Decency Act?

[Lord True (Con)]

My Lords, in the interests of time, I will write, if I may, to the noble Lord with a detailed response on that point.

Covid-19: Debt Collection

Lord Stevenson of Balmacara Excerpts

Thursday 23rd July 2020 Lords Chamber

[Lord True]

My Lords, again, I hear what the noble Lord says. I find myself in the position of answering on behalf of a department that manages the group in relation to government debt. Obviously I will pass on to my colleagues in MHCLG the points that he and noble Lords are making. I repeat that they had announced last year that they would update guidance to councils on collection and enforcement.

[Lord Stevenson of Balmacara (Lab) [V]]

My Lords, I declare an interest as a former chair of StepChange, the debt charity. I thank the Minister for his very full replies to these questions today. To follow up my noble friend Lord Wood’s question, recommendation 3 of this excellent report states:

“Council tax debt is the only form of civil debt for which people can be sent to prison in England.”


Will the Government consider repealing Regulation 47 of what he called the “Neanderthal” 1992 council tax regulations, as recommended?

[Lord True]

I fear that I referred to “Neanderthal” to mean the age-old days when I was young but, certainly, part of the call for evidence and part of the appropriate and proper management of debt would be reflection on experience since that time. I can only repeat that my colleagues in MHCLG have said that they will update their guidance to councils on collection and enforcement.

Covid-19: Economy

Lord Stevenson of Balmacara Excerpts

Thursday 4th June 2020 Lords Chamber

[Lord Stevenson of Balmacara (Lab)]

My Lords, I congratulate my noble friend Lord Eatwell on securing this debate and delivering a masterful speech. I thank all those who have contributed. Two minutes is a ridiculously short time in which to express a fully rounded argument, but taken in the round we have covered a lot of ground and we anticipate a proper response from the Minister, perhaps backed up with letters if they are required.

My noble friend Lord Chandos said that it might be too early to draw lessons from this pandemic, but we already have a long list of issues that we need to address. Local government is starved of funds and responsibilities. Our NHS is brilliant, but not funded sustainability. Our social care system is neglected, fragmented and underfunded. The benefits system cannot cope when incomes drop unexpectedly, particularly for those in the gig economy or who are self-employed. Inequality is hard-wired into our society. In pursuit of a false goal of freedom from red tape, we have winnowed away the good regulatory base that is the foundation of all strong societies. Wages in our lower-income deciles are too low. We need to do something about the living wage. Our tax system is not fair. Productivity has stuck again and that is not capable of being resolved. Housing seems out of sync with needs, and we need to improve the treatment of those who face unmanageable personal debt. So we have a long list of starting points, not all of which we have covered in this debate, but which give us food for thought.

Yet ironically, as my noble friend Lord Darling reminded us, the crisis has also revealed the true power of the state. Joseph Stiglitz said recently:

“when we face a crisis like an epidemic or a hurricane, we turn to government, because we know that such events demand collective action”.

The urgency with which the Government have acted so far demonstrates how their response to an emergency can be swift, decisive and at scale—for example, the furlough scheme, which now supports nearly 9 million people—but more is required as we move to the recovery stage. This has led some, such as the right reverend Prelate the Bishop of Chelmsford, to suggest that an entirely new approach may be necessary, perhaps something as radical and far-seeing as the Beveridge report of the 1940s, with its call for a country to unite in the aftermath of war and to legislate for all to employ gainful employment, adequate housing, access to educational opportunity, free healthcare and an adequate income. The language used nearly 80 years ago may be archaic but Beveridge’s aims remain appropriate, albeit that today we would need to add a sixth aim: to provide a cleaner, more sustainable economy.

We are fast approaching the point where the focus of the Treasury’s efforts has to change from ameliorating supply shock to boosting demand. As the pandemic eases, and assuming we do not suffer a second or subsequent waves, how will we persuade people to spend more than they do at present on goods and services? To do that, people have to trust the Government and believe that they are not just winging it. They have to feel secure about their income and employment, and certain that spending on immediate necessities today is not going to tip them into unmanageable debt tomorrow. Consumer confidence is vital for the economy, as well as for its own sake. According to Which?, in normal circumstances consumers spend more than £110 billion per month, which is around 60% of total GDP. We do not want to turn this great pause into a great depression.

At heart it seems simple enough: the Government need to consult widely and come up with a comprehensive rescue plan to drive up demand and reduce business uncertainty for the long term—a strategy which focuses on sustainable, high-quality job creation and long-term growth significantly above recent trend levels. They also have to secure the confidence of consumers and avoid any hint of austerity, which can only make things worse.

There are important choices to be made here. For example, writing recently in the Times, the most reverend Primate the Archbishop of Canterbury said:

“There must not be a short-term fix and then simply a return to normal. We need a vision for the psychological, emotional, social and financial consequences. We must see the hope of a new way of living together.”


The Countryside Alliance says that while we must support those communities and services worst impacted —several noble Lords highlighted the problems of the creative industries, the hospitality sector and tourism—we must ensure that no part of the UK is left behind, especially seaside and rural areas. One of the persistent failures of Governments so far is to deliver on plans to provide gigabit-capable broadband to rural businesses and residents by 2025, as promised in the last general election manifesto. Can the Minister confirm that that is still the Government’s aim?

Recent polling suggests that the public also want something else. They do not want the economy simply to return us to where we were pre-pandemic; they want a new deal, with growing support for a green new deal. Voices are growing on all sides for the Government’s economic recovery plan to reflect the UK’s climate goals. Earlier this week, almost 200 chief executives from companies including HSBC, National Grid and BP signed a letter to the Prime Minister which said that

“Efforts to rescue and repair the economy in response to the current crisis can and should be aligned with the UK’s legislated target of net zero emissions by 2050 at the latest.”


Can the Minister confirm that the recovery package is in planning and that it will look beyond shovel-ready projects and be focused on long-term investment in green industries to secure the recovery? Can we look forward to an army of workers planting trees, rewilding our countryside, insulating our existing housing stock and office buildings and working on green technologies? What about a scrappage scheme focused on switching private and public transport to electric vehicles? Such a package, taken together, could provide people—particularly in rural areas and those entering the labour force this year—with much-needed job security after this period of turmoil, and benefit everyone’s financial security through lower energy bills.

The current public investment in our economy is unprecedented, but does the Minister agree that such investments should be used to return benefit to the public good? Will we follow the lead given by other countries and ensure that any government support to private companies should be in the form of equity or grants? If it is equity, does he accept that there is a case for such support to be contingent on legally enforceable commitments for companies to reduce energy-intensive activity and achieve stretching zero-carbon targets?

Finally, as my noble friend Lord Eatwell said, the pandemic has exposed severe weaknesses in global production and trade. Countries are turning in on themselves, and we know that cannot be a good thing. Twelve years ago, major international efforts led by Gordon Brown stabilised international financial markets. Now we need a resilient, co-operative, international trading system, lest Britain becomes marooned alone in a hostile post-Brexit world.

Coronavirus has cruelly exposed global inequality, so different priorities for trade need to reflect a reoriented world. A sustainable trade policy could focus on securing opportunities for all sizes of businesses, human and employment rights, consumer interests and climate protection for the long term. How does the Minister see this playing out in the UK?

We need to use this opportunity to commission a Beveridge moment, and thinking on that should start soon, but we also need an immediate demand stimulus and a longer-term plan, under which the Government will work with all parts of society to secure the recovery based on a green new deal which shares the benefits of cleaner inputs and more sustainable outputs for the benefit of us all.

Income Equality and Sustainability

Lord Stevenson of Balmacara Excerpts

Wednesday 6th May 2020 Lords Chamber

[Lord Stevenson of Balmacara (Lab)]

My Lords, I join with others in thanking the most reverend Primate for his service to the House and to the country. His excellent speech caps a career spent campaigning for greater equality in income, notably the living wage. His time has surely come. I declare an interest as a former chair of StepChange, a debt charity, and I would like to make two points.

First, we are seeing a welcome attempt by the Government to mitigate the supply shock being caused by Covid-19. Keeping sufficient liquidity in the economy to ensure that companies can survive and hold jobs open is crucial. But as the IPPR reported today, once the immediate crisis is over, the economy will be scarred and we will need a broad-based stimulus to drive up demand, reduce risk and support the creation of high quality jobs—particularly, as other noble Lords have said, for young people about to enter the job market. Can the Minister confirm that plans for this are under way?

Secondly, the figures show that the Government need most urgently to support the debt charities that are working with those who are suffering because of unmanageable debt. ONS figures show that 8.6 million people have experienced reduced income as a result of the coronavirus crisis, while Citizens Advice has reported that over 13 million people have already been unable to pay or expect to miss at least one bill, and there has been an 81% increase in the use of food banks.

The Government should lead by example by taking measures to reduce the impact on households which are falling behind on bills. These could include bringing forward the statutory breathing space, temporarily suspending the rule that people become liable for their full council tax bill if they miss one payment, temporarily halting all bailiff activity and agreeing with the proposal from Citizens Advice for better protection for renters.

[The Deputy Speaker (Baroness Pitkeathley) (Lab)]

With apologies for the difficulty in hearing the noble Lord, Lord Stevenson, I now call the noble Baroness, Lady Janke.

Budget Statement

Lord Stevenson of Balmacara Excerpts

Wednesday 18th March 2020 Lords Chamber

[Lord Stevenson of Balmacara (Lab)]

My Lords, I thank all noble Lords who have contributed to this very good debate, and the Library for its briefing, which was very informative and useful. As a result, this has been a very high-quality debate held against a fast-moving scenario. The noble Baroness, Lady Kramer, just mentioned the noble Lord, Lord Bates. He encouraged us to be optimistic about everything, so I will try to thread optimism in, although sometimes when I have been reading some of the detail, I have been rather depressed by it all.

My noble friend Lord Tunnicliffe said that the timing of this debate is normally such that we reflect on the Budget and on the reaction to it. That is what has made this debate so interesting, as the many excellent contributions today have benefited from such a rich picture.

We have also benefited from having seen how the Government have responded in real time to the economic aspects of the coronavirus pandemic, and many contributions today focused on that. Indeed, the contributions of the most reverend Primate the Archbishop of Canterbury, the noble Lords, Lord O’Neill, Lord Lamont and Lord Skidelsky, my noble friend Lord Adonis and several other noble Lords have broken new ground, which I hope the Minister will take back to his department and prosecute with some vigour.

The main challenge facing the Chancellor, on which I think he was largely successful, was how to make sense of the Conservative Party’s new clothes and, in particular, how the end of austerity U-turn was going to be achieved without destroying the Conservative Party’s alleged reputation for managing the public finances. What we got, as the noble Lord, Lord Skidelsky, reminded us was a reaffirmation of Keynesian economics. The Chancellor tried to persuade us that his party now has a large appetite for increasing public spending combined with far less appetite to raise taxes and a growth in public sector debt unseen in modern times. Timing is all, apparently. As the Resolution Foundation commented:

“The result is a Conservative Chancellor now planning a bigger state than was seen under Tony Blair, financed through higher borrowing than Gordon Brown ever saw as Chancellor”.


The Office for Budget Responsibility described it as the “largest sustained financial loosening” since 1992. So this new Conservative economic policy approach may be a third way in its imitation of some of the tropes of new Labour, but it is certainly not fiscally conservative. Time will tell, and there are enough uncertainties out there to blow even the best-laid plans off course but, as my noble friend Lord Tunnicliffe, said, we support much of what has been proposed.

As my noble friend Lord Livermore said, the most recent OBR forecasts were completed long before the widespread domestic impact of coronavirus was clear, but even so they make grim reading. The OECD forecast suggests that the UK economy will grow at 0.8% for the next two years, which will bring the UK’s annual growth outlook down to an average of just 1.2%, the worst average annual growth forecast on record. When he comes to respond, will the Minister comment on those figures?

This Budget reflects the Government’s goal to be seen to turn the corner on the austerity over the decade of the 2010s. Successive Chancellors have been increasing capital spending since 2016-17. Bringing austerity to a close on current spending is new, and very welcome, but the sober truth is that in less than five years the Government’s ambitions have gone from shrinking the state in order to run an absolute budget surplus to growing public spending to almost 41% of GDP and actively aiming to borrow around £60 billion each year. This is the new reality. The good news is that the spending review later this year will therefore be able to apportion day-to-day spending growing by an average of 2.8% a year, well above the rates of the past decade, but it is less than was promised in September last year by the previous Chancellor—4.1% was his figure—and is below the growth rates prevailing in most of the years after 2000, but it is an increase and we welcome it.

According to press reports, overall real-terms, day-to-day public spending per capita will return to 2009-10 levels by 2024-25. However, the figure is more nuanced. As we have heard from others, austerity will continue for many departments, with spending increases being sufficient only to reverse around a quarter of the real cuts per capita in the departments which have not been protected since 2010; that is, those other than health, defence and international development.

The real picture is that the Budget does almost nothing to offset the considerable welfare cuts put in place by George Osborne in 2015. As my noble friend Lady Lister and the right reverend Prelate the Bishop of Rochester said, these factors mean that not only will the incomes of the poorest families fall over the next period, but there is a significant risk that, despite the extra spending, child poverty may reach record levels by the time of the 2024 election.

Perhaps the Chancellor did not have time in his speech, but he did not mention international competitiveness and how the Government intend to address the increasing productivity gap between UK workers and those in the largest EU economies. The announcement of £600 million for new infrastructure investment is good news, albeit that the figure represents only a small increase on the Government’s existing plans, while some of the money is a reversal of cuts in previous decades. Nevertheless, it will bring public investment up to around 3% of GDP, and we await further details. Can the Minister say when we will finally see the national infrastructure strategy?

The proposed changes to how the Treasury calculates the benefit of infrastructure projects may also benefit lagging regions rather than focusing solely on public projects that are most likely to generate higher returns, which tend to favour those in London. It is hoped that the new proposals will place more weight on projects across the country. But there is no easy fix when it comes to reviving the regions that are lagging. New money for infrastructure projects will go only so far given that renewal also requires investment in better skills, support for business and knowledge networks, strong local public services and local government. When will we see those proposals?

The Chancellor announced an increase in public spending on research and development, more than doubling the current budget. This is good, but the Budget was quieter about using innovation to tackle other societal problems such as adapting to an ageing society and research around the creative industries, perhaps building on the Creative Industries Clusters programme. Can the Minister confirm that there is more to do in these areas?

Small businesses took centre stage as part of the Chancellor’s £30 billion Budget package to deal with the coronavirus outbreak. Increasing resilience in SMEs is crucial to help them overcome major economic shocks and requires bold and decisive action. As research shows, the uncertainty caused by Brexit and the global financial crisis is deeply harmful to UK SMEs. While on paper the Chancellor’s new lending measures seem appropriate in scale, they are very supply-side focused and assume that there will be uptake and demand from SMEs but, as we know from the global financial crisis, uncertainty typically leads to reduced demand. Given that, what about doing more? If these measures prove insufficient, do the Government have other plans such as a reduction in VAT for SMEs? As the noble Baroness, Lady Kramer, suggested, what about speeding up payments to SMEs and giving more powers to the Small Business Commissioner?

I turn now to the coronavirus announcement. A number of noble Lords have said that we have to work together as a country to overcome this threat, so we on this side make it clear that we pay tribute to the work of experts in the NHS and to the Government for their work so far, and we join the Chancellor in saying that we should do what needs to be done to get this sorted. However, as several noble Lords have argued, if we are facing an unprecedented demand and supply shortage shock, are we doing enough? People are being laid off today and thus losing their incomes. Gig economy workers and the self-employed are not getting the support they require. The general sense of today’s debate is that something along the lines of the people’s quantitative easing proposal made by the noble Lord, Lord O’Neill, may be required to ensure that the economy itself is not damaged beyond repair.

I was struck by the suggestion made earlier in the debate by the right reverend Primate the Archbishop of Canterbury and picked up by others that we may lack more of a moral dimension to some of the issues we face. One concern mentioned in the other place was the impact that all this will have on the charitable sector, which faces a bleak future if funding dries up. Have we thought through how we would function as a society if the third sector were not able to function after the end of the crisis? Let us take the recommendation to practise social exclusion. Why is the language being used so vague that those affected—hotels, restaurants, pubs, theatres, galleries and arts organisations—are not eligible to claim on the insurance cover that they have paid for?

As a result, as we have heard, premises are closing, jobs are being lost and the very fabric of our society is being destroyed before our eyes. It is morally reprehensible, but it is also economically illiterate. Take the early announcement to safeguard mortgage payers; no parallel announcement has emerged about those who rent. Housing is vital to survival, whichever choice of tenure you take. Surely, that is morally reprehensible as well as economically illiterate. Chasing loans for SMEs, which will be hard and slow to administer, may also encourage bad effects in a nation which already suffers from a personal debt problem. Is that fair or moral?

I could go on, but I will make just one further point, as made earlier in the debate, about the school closures which we now know are happening. I gather that the Minister has some expertise on this issue. Can he ensure that the wide impacts of this change—particularly as grandparents are apparently being asked not to help out with childcare—are taken properly into account? Free school meals have already been mentioned, but this is also about careers and future employment for older cohorts, as much as it is about learning social skills and growing up in our society for younger cohorts. How will that all be dealt with and by whom? Will it be sustainable and fair to all concerned? This has been a very interesting and somewhat inspiring debate, and I look forward to the Minister’s response.