Post Office Update

Paul Scully Excerpts

Wednesday 19th May 2021 Commons Chamber

[The Parliamentary Under-Secretary of State for Business, Energy and Industrial Strategy (Paul Scully)]

With permission, Madam Deputy Speaker, I would like to update the House on changes to the Post Office Horizon IT inquiry. Over a 20-year period, the Post Office Horizon computerised accounting system recorded shortfalls in cash, which were allegedly caused by sub-postmasters, leading to dismissals, recovery of losses and, in some instances, criminal prosecutions. I know that Members across the House are aware of the terrible impact that this has had on affected postmasters and their families. The life-altering implications of these accounting errors cannot be overstated.

The Post Office Horizon IT inquiry, led by Sir Wyn Williams, was launched in September 2020 as a major step towards righting the wrongs of the past. The inquiry was established on a non-statutory basis to enable the chair to work quickly to establish a clear account of the implementation and failings of the Horizon computer system over its lifetime.

On 27 April, I made an oral statement to the House following the decision by the Court of Appeal on 23 April to quash the convictions of 39 postmasters who had been convicted for Horizon-related shortfalls. As I said then, the Government recognise the gravity of the court’s judgment and the scale of the miscarriage of justice that it makes clear.

Sir Wyn and I are both of the view that the context for the inquiry has changed in the light of the judgment by the Court of Appeal and that now is the right moment to convert the inquiry to a statutory footing. Therefore, I can now inform the House that, with the agreement of the Prime Minister, I will convert the inquiry to a statutory footing on 1 June 2021. I have also agreed that Sir Wyn will now have more time to undertake his work. The inquiry is now expected to report in autumn 2022, rather than summer 2021.

Together, these changes will give Sir Wyn the powers and the time that he needs to conduct an in-depth analysis of the decision-making processes that led to the Horizon scandal. He will be able to compel organisations to provide documents and witnesses to give evidence, under oath if necessary. It is now for Sir Wyn to consider his next steps, and I expect that he will provide more information on his proposed approach soon. In the short term, the inquiry will complete its planned engagements through May, but public hearings that had been expected to take place in June will be delayed.

I have always said that the inquiry should proceed quickly to get the answers that postmasters and their families are seeking. Sir Wyn has gathered a lot of evidence from key parties and engaged with many affected postmasters; I have therefore asked that he provide a progress update to his original timeline of summer 2021, to make public the progress to date and any initial findings. I hope that still more affected postmasters will choose to engage with Sir Wyn as he continues his work on a statutory footing.

The inquiry’s overarching aims—to ensure that the right lessons have been learned and to establish what must change—will remain. However, there will be some changes to the terms of reference in the light of the Court of Appeal judgment. I have today notified the House of the updated terms of reference in a written ministerial statement.

I thank Sir Wyn for his quick progress on the inquiry to date and for taking the time with me in recent weeks to consider the next steps for it. I am pleased to confirm that he has agreed to remain as chair of the inquiry for the next phase.

Finally, I note that converting the inquiry to a statutory footing and proceeding over a longer period will, of course, have cost implications, but I assure colleagues across the House that they are being fully considered with my colleagues in HM Treasury.

The Horizon saga has wrecked lives and livelihoods. We cannot undo the damage that has been done, but we can establish what went wrong at the Post Office and ensure that nothing like it is ever allowed to happen again. The events surrounding the dispute have long been shrouded in darkness, and this Government are determined to bring them into the light. The landmark Court of Appeal judgment changed the context for the inquiry. Following it, the Government did not hesitate to act to give the inquiry more teeth and equip Sir Wyn with more powers. To affected postmasters and their families, my message is that we are listening and we will get to the bottom of this appalling affair. I commend this statement to the House.

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[Madam Deputy Speaker (Dame Eleanor Laing)]

I did not want to interrupt the hon. Lady, but Mr Speaker would be annoyed with me if I did not point out that she has taken a minute longer than she ought to have had, and that is a minute that will not be taken later today by some other Member who wishes to speak.

[Paul Scully]

I send my best wishes to the hon. Member for Newcastle upon Tyne Central (Chi Onwurah); I understand why she cannot be here. I appreciate the response from the hon. Member for Feltham and Heston (Seema Malhotra), and I will try to answer some of her questions.

The hon. Lady talked about Ministers’ role in this. Clearly, the role of our Department, Government and Ministers will be included in the inquiry. We do want to learn the lessons, and that will be the case, but as we have seen from the judgment, the Post Office consistently maintained that Horizon was robust and was misguided in its approach to the issue, leading to the decision to prosecute these postmasters. We pressed management on issues regarding complaints brought by postmasters about Horizon and received repeated assurances that the system was reliable. As I say, the inquiry will look into that.

In terms of the Government’s response, we clearly recognise the impact that convictions have had on individual postmasters and their families. That is why the Prime Minister and I met with a small group of them last month, to hear directly from them. They had some incredibly tragic and terrible stories, and I can understand why they find it difficult to trust anybody in this regard after many, many years of difficulty and the impossible situation that they and their families have been in.

On Horizon itself, the Post Office is looking into that. It cannot, unfortunately, just switch off a system and change midstream, but clearly it will be looking to work on the successor CRM—customer relationship management —system. Yes, the terms of reference and the statutory footing allow Sir Wyn to compel people to give evidence and documents, and there are sanctions on them if they should fail to do so, under the Inquiries Act 2005. One of the reasons for that, as we move to the second stage and, I hope, engage more sub-postmasters to give their stories, is that we want to give them the confidence that people will be giving their evidence. I must say that, to date still, everybody involved in this whom Sir Wyn has asked to do so has given their full undertaking and worked on it. Nobody has resiled from the inquiry, but it is important that we do this.

On the terms of reference in relation to compensation, an inquiry, whether statutory or not, cannot determine liability in itself—that still has to be done through the courts—but sub-postmasters clearly can raise, and I would fully expect them to raise, the issue of the losses and difficulties as they outline the difficulties they have had. On Fujitsu, as I have said, clearly the Post Office will be looking at what it does in further compensation, and that will include Fujitsu. There are criminal investigations going ahead, so that is outside the scope of the inquiry, but the GLO—group litigation order—settlement was a full and final settlement. The Government did not have a part in the litigation. It is not part of the inquiry itself, but none the less, this is one part—an important part, but one part—of making sure that we get to the bottom of this and get sufficient justice for the postmasters so badly affected.

[Lucy Allan (Telford) (Con)]

I warmly congratulate the Minister on his statement, and I think it is fantastic news for sub-postmasters. I would like to thank the Prime Minister for meeting sub-postmasters, including my constituent Tracy Felstead, and for understanding the terrible injustice that they have suffered for so long. Can the Minister assure me that compensation will be paid to all those affected, including those who were party to the horrendous struggle that was the group litigation? Does he agree that these sub-postmasters should not be penalised for shining a light on the conduct of the Post Office, and they should not be required to fund the pivotal judgment of Mr Justice Fraser, without which no convictions would have been overturned? Can he please agree with me that compensation must be fair to all sub-postmasters?

[Paul Scully]

I thank my hon. Friend, who has been really dogged in her championing of Tracy Felstead and many others who have been affected. I was pleased to meet Tracy—who gave such tragic testimony—alongside the Prime Minister. On compensation, the Post Office is engaging in the compensation process. I will, in my regular meetings with the Post Office, make sure that we keep on top of that, because we want to ensure justice and fair compensation for all who have been affected.

[Marion Fellows (Motherwell and Wishaw) (SNP)]

It is a real pleasure to follow the hon. Member for Telford (Lucy Allan), who is a member of the all-party parliamentary group on post offices. I thank the Minister for advance sight of his statement, and I welcome the statement that the inquiry into the Post Office’s Horizon scandal is to be put on a statutory footing—something for which MPs across the Chamber have been calling for months. However, if this is the case, it should have been set out properly by the UK Government in Parliament, not briefed beforehand to the press.

The Horizon scandal has been a serious miscarriage of justice, potentially carried out knowingly. It is a grave injustice that some, sadly, have taken their own lives and others have been imprisoned. The SNP has repeatedly called for a judge-led statutory inquiry, and the Minister and I have had discussions on this previously. Entire lives have been ruined, and it is critical—critical—that no stone is left unturned in securing real justice for those affected. The UK Government must agree to meet all costs as a result of any compensation due, so that the post office network is not impacted. We must not lose sight of that. We absolutely welcome the statutory inquiry, as I have said, but we must also make certain that those responsible are held to account. This is really important.

I want to thank the Justice for Subpostmasters Alliance, the Communication Workers Union and the long-standing members of the APPG, who have fought tirelessly for this outcome. I look forward to seeing the Minister next week in my capacity as chair of the APPG, when he comes to talk to us further.

[Paul Scully]

I always welcome meeting the hon. Lady, and I congratulate her on her work for the all-party group. I appreciate her support for this change and I absolutely agree with her that we have to make sure that in getting justice and righting the wrongs of the past we do not jeopardise the future of the Post Office, with the social value it gives, as well as the economic value, for so many people across this country. We must make sure that we restore confidence for not only future postmasters within the network but its customers, so that it is there for many years to come.

[Andrew Bridgen (North West Leicestershire) (Con) [V]]

I am delighted that the Minister has announced that we will get the full public inquiry that we have needed for so long, to finally draw a line under this tragic fiasco and get to the truth. Following his and the Prime Minister’s recent meeting with a few of the sub-postmasters caught up in this debacle, including my constituents Mr and Mrs Rudkin, does my hon. Friend agree that the sub-postmasters are ordinary, honest and credible people, who have been caught up in incredible events that were not of their making and not their responsibility, but which have had a massive detrimental effect on their lives and the lives of their families?

[Paul Scully]

Let me again thank my hon. Friend for his work in raising the case of Mr and Mrs Rudkin and other postmasters, and he is right. Mr Rudkin was one of the leading witnesses who blew a hole in the evidence and this led to success for those postmasters in various stages of the court case and, unfortunately, Mrs Rudkin was left to carry the can in her experience as postmaster. She is very typical of many postmasters who have been affected: ordinary people who are stalwarts of their villages, towns, communities. That is why we must redouble our efforts to seek justice and fair compensation for them.

[Darren Jones (Bristol North West) (Lab) [V]]

I thank the Minister for an advance copy of the statement. My Select Committee and I called for this inquiry to be on a statutory footing from the beginning and so we welcome the statement today. However, if I have understood it correctly, the terms of reference are still being decided by Ministers and not by the independent chair, Sir Wyn Williams —why?

[Paul Scully]

No, that is incorrect; this is being done in collaboration with Sir Wyn. I spoke to Sir Wyn shortly after the Court of Appeal’s judgment and comments. He asked for more powers—not just statutory ones but to be able to look further back—and that is why we made changes. Although the inquiry would not explore matters of substantive criminal law, which of course should be decided by the criminal courts, he felt that he could look at this better, first, within the statutory footing and, secondly, with some of the changes to the terms of reference that we have expanded today. That was done in collaboration with Sir Wyn.

[Duncan Baker (North Norfolk) (Con)]

Just a few weeks ago, I asked about this at Prime Minister’s questions, so I thank the Government for listening and I welcome the statutory footing. Justice and peace of mind is one thing, but adequate compensation for the victims is another. Fujitsu must not be let off the hook. What assessment has the Minister made to ensure that Fujitsu contributes to the fund to ensure that people who are still hugely at loss are properly compensated?

[Paul Scully]

I thank my hon. Friend, a former postmaster himself, for that. He absolutely understands the situation and has been a dogged champion. We did say that if things should change, we would change. Things have clearly changed as a result of the Court of Appeal judgment. He raises a pertinent point about Fujitsu. It is for Post Office Ltd to work out the terms of compensation around this issue, but I am sure it will hear what he said and raise that incredibly pertinent point as redress is sought.

[Mr Kevan Jones (North Durham) (Lab)]

I thank the Minister for his statement. I also give him credit: in the 10-plus years that I, the hon. Member for North West Leicestershire (Andrew Bridgen) and Lord Arbuthnot have been campaigning on this issue, this is the first time that a Minister has admitted that when things go wrong he will change them.

It is right that we get full disclosure of the facts and justice for those who have been wronged. May I ask the Minister about disclosure? Will that include the ministerial submissions from the Post Office throughout this scandal and the role of the Government shareholder on the board of the Post Office? That is key to the reasons why things were not questioned. Also remember that in 2019 the Post Office spent £100 million of taxpayers’ money defending a civil case that was, frankly, completely indefensible.

I stress one last thing to the Minister. I know that Ministers like to hide behind the Post Office, saying that this is its fault. It is not: it is a wholly owned company of the Government. The Government have to take responsibility for some of this; they cannot just blame the Post Office.

[Paul Scully]

I thank the right hon. Gentleman, who has rightly been pushing on behalf of postmasters in general for a number of years.

Yes, nothing is off the table. We want to get justice and answers for people, and that clearly includes the role of the Government and shareholders. The fact is that, yes, we are the single shareholder through UK Government Investments, but that allows Post Office Ltd to work operationally independently of the Government —otherwise, there would be no point in splitting it that way. None the less, as I say, our representatives on the board have been asking that question. We were assured that Horizon was robust in all these areas. None the less, within the inquiry those questions will no doubt be asked and I expect them to be answered.

[Simon Fell (Barrow and Furness) (Con)]

I warmly welcome my hon. Friend’s statement and the work being undertaken by Sir Wyn in what is now a statutory inquiry. It is right that the inquiry should look at how on earth this was allowed to happen in the first place—most pertinently, why the Post Office and Fujitsu completely ignored the red flags being waved by trusted sub-postmasters across the network.

Compensation will be key. Sub-postmistress Isabella Wall from Barrow lost her home and business and was left with nothing. Can my hon. Friend guarantee that fair compensation for those who have been completely wronged through this process will be the focus of the Government?

[Paul Scully]

Through you, Madam Deputy Speaker, I pass my best wishes to Isabella Wall; I can only imagine what she and her family have been through. We will continue to talk about these issues over the next year, as the inquiry goes through.

Yes, the inquiry looks at what went wrong and goes back historically to give confidence to those affected and in the future network. But clearly we want to make sure that postmasters get fair compensation as well as justice.

[Karl Turner (Kingston upon Hull East) (Lab) [V]]

I thank the Minister for finally recognising the need to make this a statutory inquiry. As he knows full well, at every turn the Post Office has done everything it can possibly do to defend the indefensible. The inequality of arms in terms of legal representation has enabled these persecutions of innocent hard-working men and women. What discussions has he had with the Treasury for funds to be put aside to ensure that these innocent victims get fair and equal representation in this now statutory inquiry?

[Paul Scully]

I thank the hon. Gentleman, who has been persistent in standing up for postmasters.

The situation has been going on for 20 years—a long, long time—and it is so important that we get to the bottom of it. Clearly, we have already been speaking to the Treasury, which has supported the Post Office in a historical shortfall scheme, and we will continue to do so. It is so important that people get fair redress and compensation and that we put the Post Office on a good footing for the future. Although this issue has been going for 20 years, I should say that Post Office Ltd now, under chief executive Nick Read, is determined to look positively to the future while standing up and supporting us in getting the answers about those last two decades.

[Mark Pawsey (Rugby) (Con)]

I was a member of the Select Committee that in March last year heard really distressing accounts from Post Office staff, including constituents of my hon. Friends who were wrongly convicted of discrepancies, and we heard about the devastating effect on their lives. I am really pleased that the Minister, the Secretary of State and the Prime Minister have heard about that for themselves, and I really welcome today’s action. I also heard from Binley Wood’s sub-postmaster, Shailesh Patel, who tells me that he has increasing amounts of hours’ work for reducing commissions. What steps can Minister take to ensure that the Post Office properly looks after its staff who perform such a valuable role in our local communities?

[Paul Scully]

I absolutely agree with my hon. Friend about the role that post offices play in communities, which is all based on postmasters. I speak regularly to the chief executive and other people in Post Office Ltd and fair remuneration for postmasters is absolutely at the heart of our discussions to ensure that they keep adding social value.

[Mr Alistair Carmichael (Orkney and Shetland) (LD)]

You know, Madam Deputy Speaker, that I am not the sort of man to stand here and say, “I told you so,” but on 20 June last year I told the Minister that this was exactly what was going to happen. I hope that the work Sir Wyn Williams has done thus far will not be wasted and will not have to be repeated. The Minister also knows that of the £58 million settlement given to sub-postmasters by the Post Office, £46 million went in the payment of legal fees. Those legal fees were only necessary because the Post Office sought to defend a case that it should not have been defending. If the Minister really wants to reset the relationship between the Government, the Post Office and sub-postmasters, he could do no better than to give an undertaking today to give that money back to the postmasters.

[Paul Scully]

First, I can say that the work of Sir Wyn to date will not be wasted. That is exactly why we are converting the inquiry into a statutory inquiry rather than stopping and starting again—to allow him to continue his work until we get to phase two. On the group litigation settlement, I have talked about the fact that it was a full and final settlement, but I understand exactly where the right hon. Gentleman is coming from. That is not within the scope of the inquiry, but we will continue to look at what we can do to give a fair settlement of compensation for postmasters in the different tranches of the stages of the civil and criminal cases.

[Andrew Jones (Harrogate and Knaresborough) (Con)]

I thank my hon. Friend for his statement. I welcome the changes to the Horizon scandal inquiry, and I think it will help those seeking justice and compensation. I think it will also help boost trust in the inquiry. Trust is central to a thriving Post Office and trust is necessary for people to take on the role of sub-postmaster or sub-postmistress with any certainty or security. If people do not take on a Post Office licence, then post offices will disappear from our high streets and the critical role they play in our communities will be lost. How will my hon. Friend work with the Post Office to rebuild that trust to ensure our post office network serves our communities long into the future?

[Paul Scully]

My hon. Friend is absolutely right. My uncle was a postmaster. I remember him retiring and putting his savings into a post office in Leicestershire many years ago, pre-dating the knowledge of the Horizon situation. I wonder whether he would have done that again years later. That is why it is so important that we get these answers and get that settlement to give former postmasters justice. It is also really important—I know this is happening—that Post Office Ltd recalibrates its relationship with postmasters to ensure they feel a valued part of the company as well as the community, rather than distant stakeholders.

[Alison Thewliss (Glasgow Central) (SNP) [V]]

The last time the Minister came to the House, I asked him if full legal costs would be compensated. He said then that he would lean in on that and ensure everyone was adequately compensated. It may be that his idea of adequate may not be same as those affected, so I ask him again: will full legal costs be included in compensation packages?

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[Paul Scully]

As I say, compensation packages are a matter for Post Office Ltd and we will continue to work with it on that. Post Office Ltd is working with wronged postmasters to determine how that compensation package should look.

[Scott Benton (Blackpool South) (Con)]

I know my hon. Friend understands the financial and emotional suffering that this process has caused many postmasters and their families, including some of my constituents, and I welcome this statement today. Is he able to reassure the House that the Government will do everything within their power to encourage affected postmasters to come forward and engage with the inquiry so that their voices can be heard?

[Paul Scully]

Absolutely. It is incumbent on us all, and I really hope that we can give confidence to sub-postmasters—not just those who have had their convictions quashed, but wider members of the group litigation. All postmasters should feel some confidence that they can come forward, tell their stories and know that we hat we are determined to get them answers.

[Ian Byrne (Liverpool, West Derby) (Lab)]

The Post Office scandal is one of the gravest miscarriages of justice in this century. It destroyed many lives and families, and justice must be given to these families in full. While I welcome the premise of a statutory inquiry, will the Government address the limited remit of the inquiry, which does not cover compensation or the accountability of managers in this scandal?

[Paul Scully]

To be fair, the accountability of managers will absolutely be in the inquiry, because that is part of the expansion of it. Sir Wyn can now look right the way out to the settlement of the group litigation and ensure that it is not just about the wrongs of the 20 years, but the lead-up to that civil case as well. I have answered the question about compensation in as much as an inquiry, statutory or not, cannot determine liability in itself. That needs to go through the courts, but I dare say that postmasters giving evidence will share their experiences of their financial losses, as well as the emotional impact on them and their families.

[Mike Wood (Dudley South) (Con)]

The behaviour of the Post Office and the failures of Fujitsu have destroyed the lives of many hard-working and innocent postmasters. The Minister is clearly right to put this inquiry on a statutory footing, but what will he be able to do to ensure that, whatever the inquiry concludes, the Post Office acts on those recommendations and the report is not simply allowed to gather dust in a drawer?

[Paul Scully]

Part of the inquiry is to measure whether the Post Office has put into place the things that it has promised to do as a result of the civil litigation and the many, many pages of evidence and comment by Mr Justice Fraser. There are many areas there that should put the Post Office on a firm footing for the future relationship with its postmasters. This part of the inquiry is testing whether they have done so already.

[Jonathan Edwards (Carmarthen East and Dinefwr) (Ind)]

Last week, we received news that Barclays was closing its last branch in Ammanford, the main town in my constituency, leaving only one remaining bank—a fate shared by all the market towns in my constituency, some of which have been left with none. That leaves the Post Office the last remaining financial provider of everyday vital services for our communities. That fate is, I would imagine, shared across the whole of Wales and the rest of the UK. Is it not time to give sub-postmasters the option of being recognised as employed workers, as opposed to independent contractors, so that they are remunerated properly for the vital role they play in our communities and as a means of righting the wrongs served upon them by the Horizon scandal?

[Paul Scully]

The Post Office speaks regularly to the unions and to postmasters in general. Two postmasters have been elected to serve on the board, but the hon. Gentleman is absolutely right to talk about access to cash. The Post Office has good plans to pilot new ways of access to cash to replace the last bank in town, an issue that he rightly articulates.

[Richard Graham (Gloucester) (Con)]

As a former chair of the all-party group on post offices, I welcome the Minister’s announcement that this inquiry into the absolute disaster of the Post Office-Horizon IT issue will be put on a statutory footing. This issue has already damaged the lives of many people and shaken confidence not just in our ability to have effective public sector software contracts, but indirectly in our justice system which, because of wrong information, delivered wrong verdicts. The opportunity to provide redress for many of those involved is surely vital for us all. Will the Minister confirm that all possible technical advice will be provided to the inquiry so that some of the technical issues, such as the data library and so on, will be exposed—and, above all, who knew what? Will he also confirm that the role of the National Federation of SubPostmasters will be looked at closely to see what alarm bells it sounded and what communication there was between it and Post Office Ltd?

[Paul Scully]

My hon. Friend is absolutely right. Sir Wyn will look at both those things—he will look at those alarm bells—because that is so important to learn those lessons. We cannot learn them any other way, so he is right to do that. Clearly, with this being a computer software issue over two decades, Sir Wyn is getting the technical advice that he needs, and he will always have that support from us. We will make sure that he gets whatever he is asking for in terms of technical support.

[Maria Eagle (Garston and Halewood) (Lab) [V]]

Serious concerns have been expressed about the conduct of many of the private prosecutions that led up to the 900 or so wrongful convictions of innocent sub-postmasters, including some of my constituents, so why have the Government declined to accept the Justice Committee’s recommendation to introduce a binding and enforceable code of standards for private prosecutors and an inspection regime that would have identified these abuses at a much earlier stage? Will the Minister now accept that recommendation?

[Paul Scully]

The private prosecutions themselves, and the use of private prosecutions, are not within the scope of the inquiry, but clearly the way that the Post Office investigated this absolutely is. The Post Office has not used a private prosecution since, I think, 2013 and has pledged not to use them, but we will always look into the systems of prosecutions. As I said in my last statement, there are clearly wider lessons to be learned for the justice system in general.

[Virginia Crosbie (Ynys Môn) (Con)]

I thank the Minister for his statement. On behalf of my constituents on Anglesey, I welcome the news that those wrongly accused will not face prosecution. I have many happy memories of spending time as a child at my great-grandfather’s post office, and I have seen at first hand how vital the role is that postmasters play in the community. Will the Minister confirm that the recommendations from the inquiry will be used to be ensure that this travesty, which has torn apart lives, including those of people such as Margery Williams and Noel Thomas, both of Ynys Môn, will never happen again?

[Paul Scully]

Yes, I assure my hon. Friend, regarding Noel Thomas and Margery Williams, that we must right the wrongs for these people and for many, many others. I just want to correct her on one thing because, yes, the Post Office will not be prosecuting any more, but we clearly have to get through the judicial process for the many, many people who have been prosecuted and to see exactly how many of them have been prosecuted with Horizon being a significant factor in the prosecution. The Court of Appeal has a lot of work to do following this statement.

[Chris Elmore (Ogmore) (Lab)]

I welcome the Minister’s change of heart. It will provide much-needed reassurance, as he mentioned, to sub-postmasters, including my constituent, John Bowman, whom I mentioned to the Minister previously. What will happen now for the sub-postmasters who have lost everything so that they have the financial confidence to get evidence to Sir Wyn’s inquiry? If they cannot afford to give that evidence, if they require legal support, what work is the Minister doing with the Treasury to ensure that those postmasters who have lost everything, including, in some cases, their homes, have the funding available to take part in this now statutory inquiry?

[Paul Scully]

We absolutely want sub-postmasters to give evidence. There is obviously a cost implication in extending the inquiry and making it statutory. I am working through that process with my colleagues in the Treasury, and we want to make sure that everybody and anybody who has been affected can come forward to give that evidence with confidence, no matter what their financial situation is.

[Theresa Villiers (Chipping Barnet) (Con)]

My sympathy goes to everyone affected by this appalling scandal. Looking to the future, does the Minister agree that one of the best ways that we can support sub-postmasters and the post office network, which means so much to our constituents, is by using it to deliver more Government services? Up to now that been made difficult by EU procurement rules, which we can now change?

[Paul Scully]

Those are exactly the things that each Government Department that has traditionally used the Post Office will continue to explore. None the less, the Post Office does not necessarily just need to be limited to Government services. There are plenty more things that it can do to modernise and ensure that it better reflects customer demand. I push the chief executive Nick Read on this point, although he does not need pushing on it because he is very front-footed on the situation himself.

[Liz Twist (Blaydon) (Lab)]

I welcome the move to a statutory inquiry, but also note the extension of the timescale for the inquiry; it has been extended, I think, by some nine months or so. John and Pat Moir had a post office in Winlaton Mill in my constituency and were caught up in the Horizon scandal. They are now constituents of my hon. Friend the Member for Newcastle upon Tyne North (Catherine McKinnell), who had hoped to ask a question herself. Mr and Mrs Moir have spent more than a decade fighting this case and fighting to clear their name. Clearly they welcome this inquiry, but what assurances can they have that it will work to the timescales, so that they and others can see the outcome before more time passes?

[Paul Scully]

The hon. Lady is absolutely right to ask that question. One of the key reasons why I originally set it up as a non-statutory inquiry was to ensure that we were not overly burdened with bureaucracy and the need to “lawyer up”, which tends to extend statutory inquiries to three years and beyond. I have said to Sir Wyn that I do want an interim report to the original timescale, so that we can show the public progress, but we are going to have an extra year to ensure that extra evidence is considered. We will hold him to time as best we can, but we do want to ensure that we get the answers.

[Christian Wakeford (Bury South) (Con)]

The importance of the Post Office has increased in every community across this country, especially as high street banks continue to close, as is the case in Radcliffe in my constituency, where there are now no banks. Does my hon. Friend agree that postmasters truly are the backbone of the Post Office, that it is those postmasters who have delivered such vital services up and down the country, particularly in towns such as Radcliffe, Whitefield and Prestwich, and that we need to strengthen that relationship? Does he therefore share my concern about the way in which many have been treated by the Post Office through this scandal?

[Paul Scully]

My hon. Friend is absolutely right, and that is what is so galling for the postmasters who had those roles in the past. They were the stalwarts and the backbone of their community; the stigma of being accused of false accounting or fraud must have been so unbearable, as we know from the incredibly tragic testament that we have heard. As well as getting answers on that, we want to reset the relationship with postmasters so that they can go back to being the centre of their community, adding such social value, and bringing and keeping communities together.

[Alexander Stafford (Rother Valley) (Con)]

I am sure that the whole House will join me in welcoming the fantastic news that the sub-postmasters wrongly accused across the UK will no longer face prosecution, meaning that this hugely difficult time for them is finally at an end. I shall always stand by Rother Valley’s hard-working sub-postmasters and postmasters. It is incredibly important that full and timely justice is served. Will my hon. Friend therefore commit to holding the Post Office’s feet to the fire, ensuring that it studies carefully whatever recommendations may arise from the inquiry to ensure that this can never ever happen again?

[Paul Scully]

This is the end of the beginning. Clearly, there is a long way to go to ensure that we get the answers, but in holding the Post Office’s feet to the fire, I do not want to add stigma to the Post Office moving forward; for the reasons that we have heard today, post offices are right at the heart of all our communities, so it is important that we have that day zero to reset the Post Office’s future relationship with postmasters and its communities while getting answers, justice and fair compensation for those who have been wronged over the last two decades.

[Gavin Newlands (Paisley and Renfrewshire North) (SNP)]

I do welcome the statement, but it has taken far too long for it to happen. My constituent was held responsible for missing funds, charged, convicted and sentenced to 13 months in prison. It cost her not only her home, which she had to sell to meet these debts, but her marriage. She was left penniless and had to move out of the area, and is understandably concerned that nearly 40% of the compensation awarded is just swallowed up by legal costs. As others have said, that has to be addressed. My constituent has lost everything. What does appropriate compensation look like for people like her?

[Paul Scully]

I hope that the hon. Gentleman’s constituent will feel confident in coming forward and outlining her case and those financial losses, exactly as he has described, so that Sir Wyn can take a holistic view. On compensation, as I say, the Post Office now needs to ensure that it works with the postmasters and addresses issues such as Fujitsu, which my hon. Friend the Member for North Norfolk (Duncan Baker) talked about earlier, and that it compensates all these wronged postmasters in a fair way.

[Bob Blackman (Harrow East) (Con) [V]]

My hon. Friend will be well aware that the overwhelming majority of men and women who run our post offices are small business owners who work extremely long hours and have to deal with extremely complex and different sets not only of accounts but of transactions. Given the circumstances that have arisen under the Horizon scandal, what actions will he take to ensure that the position is rebalanced between those small business owners and the vast monolith of the Post Office, so that we get justice for everyone running these businesses?

[Paul Scully]

My hon. Friend is absolutely right. That process is already taking place under the leadership of Nick Read, who comes from an independent supermarket background, where he managed to grow a culture very similar to the relationship that he describes wanting to see in the Post Office. That is why I am confident that, if we can get these answers and get recompense, justice and fair compensation for those who have been wronged, we can recalibrate the relationship between Post Office Ltd and the sub-postmasters—those small business people in their communities that my hon. Friend mentions.

Post Office Update

Paul Scully Excerpts

Wednesday 19th May 2021 Written Statements

[The Parliamentary Under-Secretary of State for Business, Energy and Industrial Strategy (Paul Scully)]

Following the Prime Minister’s commitment on 26 February 2020 and the ministerial statements of 10 June 2020 and 30 September 2020, the Post Office Horizon IT inquiry was established as a non-statutory inquiry. In accordance with the terms of section 15 of the Inquiries Act, the Government have now given notice to convert the inquiry into a statutory inquiry under the Inquiries Act 2005 on 1 June 2021 and at the same time amend the inquiry’s terms of reference, as set out below.

Scope of the inquiry

Government want to be fully assured that through the inquiry there is a public summary of the failings associated with Post Office Ltd’s Horizon IT system. The inquiry will draw on the findings made by Mr Justice Fraser from the Bates and others v. Post Office Limited Group litigation, in particular judgment (No. 3) “Common issues” and judgment (No. 6) “Horizon issues”, the judgments of the Court of Appeal (Criminal Division) in R v. Hamilton and others, and other judgments in which convictions have been quashed. It will consider all other relevant evidence, listen to those that have been affected, understand what went wrong, and assess whether lessons have been learned and whether concrete changes have taken place, or are under way, at Post Office Ltd.

The inquiry shall:

A: Understand and acknowledge what went wrong in relation to Horizon, leading to the civil proceedings in Bates and others v. Post Office Ltd and the quashing of criminal convictions, by drawing from the judgments of Mr Justice Fraser in Bates and others, the judgments of the Court of Appeal (Criminal Division) in R v. Hamilton and others, other judgments in which convictions have been quashed, affected postmasters’ experiences and any other relevant evidence in order to identify what key lessons must be learned for the future.

B: Build upon the findings of Mr Justice Fraser and the judgments of the criminal courts specified in A above by obtaining all available relevant evidence from Post Office Ltd, Fujitsu, BEIS and UKGI to establish a clear account of 1) the implementation and failings of Horizon over its lifecycle and 2) Post Office Ltd’s use of information from Horizon when taking action against persons alleged to be responsible for shortfalls.

C: Assess whether Post Office Ltd has learned the lessons from the criticisms made by Mr Justice Fraser in his judgments following the “Common issues” and “Horizon issues” trials and those identified by affected postmasters and has delivered or made good progress on the organisational and cultural changes necessary to ensure a similar case does not happen in the future.

D: Assess whether the commitments made by Post Office Ltd within the mediation settlement—including the historical shortfall scheme—have been properly delivered.

E: Assess whether the processes and information provided by Post Office Ltd to postmasters are sufficient:

i. to enable both parties to meet their contractual obligations

ii. to enable postmasters to run their businesses. This includes assessing whether Post Office Ltd’s related processes such as recording and resolving postmaster queries, dispute handling, suspension and termination are fit for purpose. In addition, determine whether the quality of the service offer for postmasters and their relationship with Post Office Ltd has materially improved since the conclusions reached by Mr Justice Fraser.

F: Examine the historic and current governance and whistleblowing controls in place at Post Office Ltd, identify any relevant failings, and establish whether current controls are now sufficient to ensure that failings leading to the issues covered by this inquiry do not happen again.

The inquiry will consider only those matters set out in the preceding sections A-F. The inquiry will not consider any issue which is outside the scope of the powers conferred upon the inquiry by the Inquiries Act 2005. The Horizon group damages settlement (albeit the inquiry may examine the events leading to the settlement), and/or the engagement or findings of any other supervisory or complaints mechanisms, including in the public sector, are outside the inquiry’s scope.

Governance

The inquiry will be led by Sir Wyn Williams FLSW, as the chair of the inquiry. There will be an inquiry secretariat and Sir Wyn will be supported by up to four assessors. These assessors will support Sir Wyn Williams by providing advice on the sources, content and interpretation of evidence received as appropriate. They may also provide independent scrutiny and challenge in relation to emerging findings and recommendations.

Publication report date

The inquiry should make any recommendations it sees fit, including actions that may, in its view, be appropriate as a result of its findings. The inquiry will aim to submit its findings to the Secretary of State for Business, Energy and Industrial Strategy in autumn 2022. The final report will be published by the Secretary of State and the Government will respond in due course.

[HCWS40]

Contingencies Fund Advance

Paul Scully Excerpts

Monday 17th May 2021 Written Statements

[The Parliamentary Under-Secretary of State for Business, Energy and Industrial Strategy (Paul Scully)]

I hereby give notice of the Department for Business, Energy and Industrial Strategy having drawn an advance from the Contingencies Fund totalling £3,380,663,000 to enable expenditure on covid-19 support packages for business to be spent ahead of the passage of the Supply and Appropriation Act.



The funding is required for the Restart Grant scheme.



Parliamentary approval for additional resources of £3,380,663,000 will be sought in a main estimate for the Department for Business, Energy and Industrial Strategy. Pending that approval, urgent expenditure estimated at £3,380,663,000 has been met by repayable cash advances from the Contingencies Fund.



The cash advance will be repaid upon receiving the Supply and Appropriation Act.

[HCWS29]

Covid-19: Use of Industrial Development Act 1982

Paul Scully Excerpts

Monday 17th May 2021 Written Statements

[The Parliamentary Under-Secretary of State for Business, Energy and Industrial Strategy (Paul Scully)]

I am tabling this statement for the benefit of hon. Members to bring to their attention spend under the Industrial Development Act 1982. In addition to the obligation to report on spend under the Industrial Development Act annually, the Coronavirus Act 2020 created a new quarterly reporting requirement for spend which has been designated as coronavirus-related under the Coronavirus Act. This statement fulfils that purpose.

The statement also includes a report of the movement in contingent liability during the quarter. Hon. Members will wish to note that measures such as local authority grants, the coronavirus job retention scheme and self-employment income support scheme, and tax measures such as the suspension of business rates are not provided under the Industrial Development Act 1982 and hence are not included below.

This report covers the fourth quarter of 2020, from 1 October to 31 December 2020, in accordance with the Coronavirus Act. It also covers, for the first time, coronavirus-related spending of the Department for Environment, Food and Rural Affairs.

The written ministerial statement covering the third quarter of 2020 was published on 9 March 2021.

Spend under the Coronavirus Act2020

Under the Coronavirus Act 2020, there is a requirement to lay before Parliament details of the amount of assistance designated as coronavirus-related provided in each relevant quarter. In the period from 1 October to 31 December 2020, the following expenditures were incurred:

Insolvency

Paul Scully Excerpts

Wednesday 28th April 2021 Commons Chamber

[The Parliamentary Under-Secretary of State for Business, Energy and Industrial Strategy (Paul Scully)]

I beg to move,

That the Corporate Insolvency and Governance Act 2020 (Coronavirus) (Extension of the Relevant Period) Regulations 2021 (S.I., 2021, No. 375), dated 22 March 2021, a copy of which was laid before this House on 24 March, be approved.

It is a pleasure to serve under your chairmanship, Madam Deputy Speaker, as we discuss this important extension on the Floor of the House. It is now more than a year since the emergence of covid-19, and the Government have consistently taken the swift action needed to save lives and mitigate damage to the economy. The Government’s successful roll-out of the vaccine programme and the implementation of the Government’s four-step road map out of lockdown are both reasons for cautious optimism that we will soon enjoy a return to normality. To date, in excess of 33 million people have had a vaccination, and the British public have risen to the challenge of suppressing the spread of the virus by sticking to the rules, getting tested when necessary and following the guidance on hands, face, space and letting fresh air in.

We are not out of the woods yet, however, and the emergence of new strains of the virus means that this is not the time to become complacent. Social distancing measures introduced to limit the spread of the virus and help to save lives continue to have an effect on business, and the Government recognise that. Although most businesses have been able to reopen, many continue to face uncertainty and financial difficulties. Therefore, an extension is needed to the duration of the temporary insolvency measures currently in place for the protection they provide.

These regulations extend until 30 June the suspension of serving statutory demands and the restriction of filing petitions to wind up companies; the small supplier exemption and termination clause provisions; and the suspension of wrongful trading liability. In addition, the modifications to the moratorium provisions and the temporary moratorium rules are extended until 30 September 2021.

I hope the House will agree that these regulations are necessary, but I assure Members that we will keep them under constant review. I commend these regulations to the House.

--- Later in debate ---

[Paul Scully]

I thank Members for their valuable contributions to this debate—and, indeed, to the other, general debate I seem to have been hearing about coronavirus support beyond the regulations. Members have highlighted the importance of the measures that the regulations extend and the necessity of extending them so that businesses can continue to benefit from them.

I welcome the return to working with the hon. Member for Manchester Central (Lucy Powell). We are in a grander setting than usual, but the conversation remains. I understand her concern about the fact that we have come back to extend these regulations, but it is important to remember that they contain some important powers on things such as wrongful trading and the moratorium, and that we are holding a lot of things in stasis. It is right that we get the balance right between giving businesses the certainty that she rightly asks for and using Government interventions in these matters sparingly and continuing to scrutinise them in this place. I would rather that we come back and do our work regularly than overstep in respect of these powers and intervene too much in the economy. It is important to keep an eye on these things.

The hon. Lady raised the issue of those businesses that have been excluded, or that have been coming back with requests for more support, including the travel sector, the wedding sector and the visitor economy as well. They are all hugely important businesses and sectors that are vital for our recovery. We are working on all those areas. We have the global travel taskforce. My colleagues in the Department for Transport are working on international travel. I am working with colleagues on weddings. The Under-Secretary of State for Digital, Culture, Media and Sport, my hon. Friend the Member for Mid Worcestershire (Nigel Huddleston), is working on events and domestic tourism. All of these areas will be hugely important not just for the economy as a whole, but to get our towns and cities back open again. As Minister for London, that is something that I feel and see on a day-to-day basis.

The hon. Lady talked about Greensill and Liberty. Clearly, there are concerns here that need to be addressed, but, obviously, speculation about Liberty Steel and other businesses can in itself cause uncertainty to investors, employees, and people seeking to work with those companies. We are monitoring the situation. We are engaging with Liberty Steel, and we are engaging with the unions. I know that the owners of Liberty Steel are seeking a market solution, but we will continue to monitor that situation. We are also engaging with the sector, with trade unions and with the devolved Administrations to make sure that we can develop a long-term, sustainable future for the UK steel industry, because it clearly has an incredibly important role in the UK.

I say to my right hon. Friend the Member for South Northamptonshire (Andrea Leadsom), erstwhile Secretary of State for Business, Energy and Industrial Strategy, that we want to make sure that, within our Department, we are building on her excellent work in the areas of audit reform and corporate governance. She rightly pointed out some significant failures, including BHS and Carillion to name just two, and we want to make sure that we can work on that within our audit reform work. We have already published a consultation to enhance the UK’s audit control and regulation, and we will make sure that we have full debates in this place as we bring those proposals forward for scrutiny in Parliament and in terms of legislation.

Let me turn now to the hon. Member for Aberdeen North (Kirsty Blackman). I would like to pass on my thanks to others who noted her comments on depression in a previous debate. It is so, so important to speak out. I really welcome her personalised appeal to people, making sure that they know that it is okay not to be okay. They were wise words, and words that we must all take on board. There has been a mental health aspect to the lockdown. Obviously, business uncertainty plays a part. There are lots of businesses, small and large, that I see and hear from on a day-to-day basis, which are incredibly stressed and incredibly worried. I valued her words.

The hon. Lady talked about companies struggling to get back on their feet. Clearly, that is the case. I do not want to get into a wider debate about coronavirus support, but we realise that, with many of these measures, there is the risk of cliff edges, and we will continue to work through those and to flex to make sure that we can support businesses. She talked about smaller organisations as well, especially around tech and IP. Yes, we must make sure that we are working on those, too.

Over the past year, businesses have faced an exceptionally challenging time, with many unable to trade, or their ability to trade at full capacity restricted owing to social distancing measures. These regulations will provide the much needed support for businesses as we continue with the Government’s four-step road map out of lockdown, allowing them to concentrate their best efforts on reopening or continuing to trade and building on the foundations for economic recovery in the UK. We want to get to that economic recovery.

Finally, let me answer the hon. Member for Sefton Central (Bill Esterson). When he was looking to throw this open to a wider debate, I think he missed the strengthening of our prompt payment code, which was done in consultation with the signatories to the payment code, and indeed the fact that we have got more to sign up to that as well. When he was looking for a wider debate about coronavirus, he also missed the plan for growth, which does exactly what it says on the tin. It looks beyond these measures. It is a plan and, funnily enough, it is a plan for growth, which goes beyond 30 June. Careful consideration has been given to extending these temporary measures, and the Government will continue to monitor the situation closely.

I thank hon. Members for their valuable contributions to the debate. I commend the regulations to the House.

Question put and agreed to.

Ordered,

That the Corporate Insolvency and Governance Act 2020 (Coronavirus) (Extension of the Relevant Period) Regulations 2021 (S.I., 2021, No. 375), dated 22 March 2021, a copy of which was laid before this House on 24 March, be approved.

[Lucy Powell (Manchester Central) (Lab/Co-op)]

On a point of order, Madam Deputy Speaker. During Prime Minister’s questions today, the Prime Minister claimed that

“last night our friends in the European Union voted to approve our Brexit deal, which he opposed.”

That is totally incorrect. You will remember, Madam Deputy Speaker, that in an extraordinary sitting of this House of Commons on 30 December 2020, the Leader of the Opposition and the whole Labour party voted for the Brexit deal agreed by the Government and the EU. As limited as it was, we backed it and avoided a no-deal scenario. Do you agree, Madam Deputy Speaker, that it is vital that the Prime Minister returns to the House today to swiftly correct the record?

National Minimum Wage Enforcement

Paul Scully Excerpts

Wednesday 28th April 2021 Commons Chamber

[The Parliamentary Under-Secretary of State for Business, Energy and Industrial Strategy (Paul Scully)]

I congratulate my hon. Friend the Member for South West Bedfordshire (Andrew Selous) on securing today’s important debate and, indeed, his tenacity in supporting and representing his constituent. I am proud to serve as the Minister responsible for the national minimum wage, the national living wage and workers’ rights, among my other responsibilities. I very much value his generous words on the benefits of the national minimum wage to make sure that we can encourage people, as he rightly says, and ensure that work pays. We must protect people on the lowest pay grades, but make sure that they stay in work and have a fruitful career.

The Government are committed to building an economy that works for everyone. Through the national minimum wage and the national living wage, we continue to ensure that the lowest paid in society are rewarded fairly for their contribution to the economy. In April, we increased the national living wage by 2.2% to £8.91, which is the highest ever UK minimum wage. A full-time worker on the national living wage will see their annual earnings rise by over £345. That amounts to a total increase of more than £4,000 since the national living wage was announced in 2015.

We have lowered the age threshold for the national living wage to 23 and, as a result, 23-year-olds and 24-year-olds will get a 71p increase. We have increased the time for which employers must keep minimum wage records from three to six years. That means that workers will get more of the historical arrears that they are owed. The Government are committed to cracking down on employers who fail to pay the national minimum or national living wage.

[Jim Shannon (Strangford) (DUP)]

I thank hon. Member for South West Bedfordshire (Andrew Selous) for introducing the debate. I am always encouraged by what the Minister says, and it is encouraging to hear the things that have been done. However, there are loopholes that allow the hours of casual workers not to be recorded and an appropriate minimum wage is not enforced, so does he not agree that they must be closed? Do his Government intend to ensure that employers will begin doing the right thing instead of being able to avoid it, as they can at the moment?

[Paul Scully]

The hon. Gentleman makes an important, twofold point. First, on anomalies, ignorance is no defence when it comes to paying the national minimum wage, and secondly, that is where enforcement comes in. I shall expand on that in a second. He is absolutely right to raise these issues, to make sure, as I have said, that companies are not balancing their books on the poorest paid in their workforce and in society.

We relaunched the minimum wage naming scheme on 31 December, naming and shaming 139 employers, including some of the UK’s biggest household names, for failing to pay the minimum wage. We have also more than doubled the budget for minimum wage enforcement and compliance since 2015. There are now over 400 officers in Her Majesty’s Revenue and Customs dedicated to ensuring compliance with the minimum wage.

I should like briefly to share the results of HMRC’s work in the 2020-21 financial year. As we have heard, it was a really challenging year for the whole country. Many of HMRC’s investigations are carried out face to face. Its officers can arrive unannounced at business premises to check minimum wage records or to interview employers and workers. Those face-to-face visits clearly had to be limited in line with covid restrictions, and with many businesses closing their doors. Nevertheless, the Government believe that the pandemic is no excuse for failing to pay staff correctly, especially in sectors such as social care and retail, which have provided invaluable services over the past year. I am pleased that HMRC continued its enforcement and compliance work, prioritising desk work where possible and expanding its educational work with employers and workers.

Despite the pandemic, in 2020-21 HMRC closed over 2,700 cases, securing more than £16.7 million in arrears for more than 155,000 workers. It issued 575 penalties worth over £14 million. HMRC also contacted more than 770,000 employers and workers to improve awareness of the minimum wage. As part of this, it sent over 400,000 texts to apprentices regarding the risks of underpayment from unpaid training time. It wrote to nearly 200,000 employers and workers. HRMC produced a variety of webinars and educational videos that accumulated nearly 20,000 views. One of those webinars is aimed specifically at the social care sector, covering travel time, waiting time and breaks. About 12,000 letters are being sent to Care Quality Commission-registered providers of home care service to highlight that webinar.

The Government acknowledge the particular challenges in enforcing the minimum wage in the care sector. We estimate that approximately 27,000 social care workers were underpaid the national living wage or national minimum wage in 2020. That represents just over 3% of all workers in the sector and is in line with previous years. All workers deserve the wage they are legally entitled to, but particularly key workers in the current context of the coronavirus pandemic. The Government therefore asked HRMC to focus on the sector in its targeted enforcement activity. We have also recently published comprehensive revised minimum wage guidance for all employers. That includes guidance on the recent Supreme Court judgment on sleep-in shifts, where we now have clarity after years of revolving court judgments.

But I am well aware of my hon. Friend’s concerns about social care workers. We met late last year, as he outlined, to discuss the issue of care workers providing care to individuals with direct payment arrangements, also known as personal budget holders. I appreciate that the situation with personal budget holders is particularly tricky as they are vulnerable individuals, but in minimum wage terms they are often the employers of their carers. That means, under minimum wage legislation, that any enforcement action by HMRC for underpayment of their care workers can only be taken against these individuals. I would like to give some assurances on how enforcement works in practice in such cases. Where complaints are received, HMRC works with all parties to ensure that personal budget holders receive the necessary help and support while also continuing to protect the rights of workers. As my hon. Friend said, local authorities have a duty of care under the Care Act 2014 to give personal budget holders clear advice about their responsibilities as an employer. Local authorities must also be satisfied that a personal budget holder is capable of managing direct payments, and should put in place an effective monitoring process related to those direct payments. Crucially, this involves checking to ensure that the individual is fulfilling their responsibilities as an employer. I understand that there are examples of local authorities stepping up to financially assist personal budget holders where minimum wage cases are brought against them. I strongly encourage this, and it is in line with the local authority’s Care Act duties, but ultimately HMRC needs to protect the rights of any underpaid worker.

Where arrears have been repaid to the worker, HMRC has discretion on whether to issue a formal notice of underpayment. HMRC rightly makes limited use of its discretion in practice, but cases brought against personal budget holders are instances where I would expect it to consider using that discretion. I therefore urge workers who care for personal budget holders and who believe them to have been underpaid, such as my hon. Friend’s constituent, to complain to HMRC or contact ACAS for advice. I understand, having spoken to my hon. Friend, that this is clearly an issue—although I cannot comment on his individual case in detail—that is a good few years old. As I say, I admire his tenacity in working with the council as well, pushing the council to do more and also speaking to my predecessor as well as to me. I know that my hon. Friend is calling for HMRC to be able to enforce directly against local authorities in such cases, but HMRC can enforce only against the employer—that is laid out in primary legislation.

It is right that there is a clear line so that employers are always clear about their responsibilities and workers are always clear about their rights. Any change could call into question the other scenarios in which multiple parties are involved in employment, such as in respect of agency workers, umbrella companies or contractors. That could lead to protracted court cases to determine who is responsible for paying the minimum wage, which would only delay workers getting the pay to which they are legally entitled. We therefore have no plans to change the minimum wage legislation.

We are extremely proud of all our health and social care staff and recognise their extraordinary commitment, especially during the covid pandemic. The 1.5 million people who make up the paid social care workforce provide an invaluable service to the nation, especially during the pandemic. Putting social care on a sustainable footing where everybody is treated with dignity and respect is one of the biggest challenges our society faces. There are complex questions to address and we want to give them our full consideration in the light of current circumstances, which is why the Government are committed to the sustainable improvement of the adult social care system. The Department for Health and Social Care will bring forward plans for workforce reform later this year.

We are providing an extra £341 million for adult social care, to pay for infection, prevention and control measures and to support rapid testing to the end of June 2021. That will bring specific funding for adult social care during the pandemic to almost £1.8 billion. We are also providing councils with access to more than £1 billion of additional funding for social care in 2021-22, on top of the significant support provided over the past year to support the sector in dealing with covid-19.

My hon. Friend talked about the single enforcement body, which is indeed something we are consulting on and working through, not least as we move towards the introduction of an employment Bill. We are taking the time to reflect on the lessons that we have learned from the covid-19 situation—the baked-in behaviour changes to work practices in the wider sense of the employment Bill—and the single enforcement body will be a really important part of that. I look forward to my hon. Friend’s contributions to the debate when we introduce forward legislation to bring that new body into existence.

My hon. Friend made some important points and I am really pleased to have had the opportunity to respond. The Government are committed to ensuring that all workers are paid at least the minimum wage, which is their legal entitlement. We also recognise that personal budget holders and individuals who arrange their own care are often among the most vulnerable in society. When complaints are received, HMRC will work with all parties to ensure that individuals receive the help and support that they need, while continuing to protect the rights of workers. I look forward to continuing to work with ministerial colleagues to ensure that all care workers are paid appropriately under the National Minimum Wage Act.

Finally, Mr Deputy Speaker, may I associate myself with your words and wish you a very good Prorogation—or whatever the term is? Members, staff and your team have played an amazing role in allowing us to continue the scrutiny of the Government’s work and our work as a fully functioning democracy.

[Mr Deputy Speaker (Mr Nigel Evans)]

Thank you, Minister; that is much appreciated and I will ensure that that message gets passed on to the Speaker and the others in the team.

Question put and agreed to.

Redundancy Protection: Women and New Parents

Paul Scully Excerpts

Wednesday 28th April 2021 Westminster Hall

[The Parliamentary Under-Secretary of State for Business, Energy and Industrial Strategy (Paul Scully)]

It is a pleasure to serve under your chairmanship, Dame Angela. I congratulate the hon. Member for East Renfrewshire (Kirsten Oswald) on securing today’s important debate on extending redundancy protections for women and new parents. I can assure her that simply going back to how things were, as she talks about, will not be the case, as I will outline. As we get through to the Employment Bill and further consultation and discussions with businesses and other groups, including Pregnant Then Screwed, I hope we will end up in a far better place to ensure that we can tackle some of those issues.

From the correspondence I receive as a constituency MP and as a Minister, I know what a crucial issue this is, and the pernicious effect that discrimination can have on both the immediate and the longer-term prospects of women in work. More generally, there is the drag that that can put on equality and productivity. Last month, the hon. Member for Glasgow Central (Alison Thewliss) brought a number of representative organisations to talk to me about the challenges that pregnant women and new mothers are facing as a result of covid, so I am aware of the many issues that some women face.

I will start by being crystal clear about two things. First, there can be absolutely no excuse for discrimination against pregnant women or women on maternity leave. There is no excuse for any form of discrimination; it is unlawful. It can have absolutely no place as we start to build back better after the pandemic. We cannot effectively level up if we continue to allow some groups to be treated poorly simply because of who or what they are.

Secondly, I will not hide from the fact that there is a real issue here. The research that we jointly funded with EHRC has been cited and makes for uncomfortable reading. It is worth reminding ourselves of some of the key findings. Around one in nine mothers reported that they were dismissed, made compulsorily redundant when others in their workplace were not, or treated so poorly that they felt that they had to leave their jobs.

[Jim Shannon (Strangford) (DUP)]

I thank the hon. Member for East Renfrewshire (Kirsten Oswald) for setting the scene so well. From his comments, I understand the Minister is sympathetic to this issue. Overall, three in four mothers, 77%, said they had a negative or possibly discriminatory experience during pregnancy, maternity leave and/or return from maternity leave. They have an issue that needs to be addressed. I understand that the Government will respond in a positive way but even though the Government are indicating welcome measures, such as extension of time protection on return from maternity leave, there are wider aspects that need to be addressed, such as shared parental leave, and the stigma that still attaches to a father taking that essential leave. When the Minister makes his good points, will he also address that?

[Paul Scully]

The hon. Gentleman is absolutely right. There are plenty of wider issues to be considered, including the right to request flexible working that we have heard about. Making that a default option is something we have talked about significantly and want to ensure is at the heart of the Employment Bill, when parliamentary time allows that to come forward.

We still need to do plenty of work with shared parental leave. We have collected a lot of data through the consultation as part of the formal evaluation of the shared parental leave and pay scheme. That will give us a fuller picture of how well the current system of parental leave and pay overall is working for parents and employers. Some of the examples that we hear time and again in the Chamber and Westminster Hall indicate that it is not working, so there is plenty more that we can do.

To return to the findings I was talking about before the hon. Gentleman’s intervention, if they are scaled up to the general population, it could mean as many as 54,000 mothers a year are losing their jobs, in many cases simply because they have had a child. Furthermore, our research found that one in five mothers said they had experienced harassment or negative comments related to pregnancy or flexible working from their employer or colleagues. If scaled up, again, to the general population, that could mean as many as 100,000 mothers having similar negative experiences. That can never be right.

The case for Government action is as clear as day. That is why we consulted on measures to improve redundancy protection for pregnant women and new parents. Following that consultation, the Government’s formal response said that we will: ensure the redundancy protection period applies from the point the employee informs the employer that she is pregnant; extend the redundancy protection period for six months once a new mother has returned to work; extend redundancy protection into a period of return to work for those taking adoption leave, following the same approach as the extended protection provided for those returning from maternity leave; and extend redundancy protection into a period of return to work for those taking shared parental leave. We have been clear that we will introduce these measures as soon as parliamentary time allows.

The ten-minute rule Bill from my right hon. Friend the Member for Basingstoke (Mrs Miller) was raised. I am aware of calls for us to do things differently. Indeed, I met my right hon. Friend and other colleagues to discuss her proposal, which follows aspects of the German approach, and my predecessors held similar meetings. It is not the objective that we disagree on but the means of achieving it, and even then we share a lot of common ground. The key difference is that the Government’s preferred approach retains and extends the current position of giving the pregnant woman or new parent preferential treatment so that, in effect, they are first in the queue for suitable remaining jobs in a redundancy situation. Others suggest removing the current framework and replacing it with a comprehensive redundancy band with some very limited exceptions so that, in effect, that a pregnant woman or new mother could only be made redundant when a business is closing down. The Government have not yet been convinced by that argument.

At its simplest, taking that approach could require employers to continue to employ people even when there is no work for them to do if the business continued to exist. That burden would fall particularly heavily on small businesses. That is why we continue to believe that extending the existing framework remains the right approach. We believe that we are more likely to promote the culture change we seek by placing a slightly more flexible requirement on employers for an extended period. The six-month extension of additional redundancy protection into a return-to-work period will provide a period of up to 27 months when pregnant women and new mothers will be first in the queue for suitable remaining jobs in a redundancy situation. I believe that will represent a considerable and significant step forward in redundancy protection for pregnant women and new mothers.

I have heard the arguments that there ought to be a role for state enforcement in redundancies involving a pregnant woman or new mother. We need to tread carefully when looking at state roles within those sort of areas. All redundancies should be fair, and it would not be rational to treat one group within the workplace any differently from another by giving them a different arbiter in the redundancy process. I appreciate the pressure and strain that the employment tribunal system is under and will be under owing to the covid pandemic, but none the less it has considerable strengths. For instance, it allows for careful consideration of employment disputes, which are often complex or may not be clear-cut, by those with appropriate expertise. Case law from employment tribunals allows our laws to evolve and develop to reflect changing working practices.

However, I am only too aware that improving redundancy protection only goes so far. The majority of employers report that it is in their interest to support pregnant women and those on maternity leave, with the main reasons being to increase staff retention and to create better morale among employees, but we know that many employers feel that women should declare up front during recruitment whether they are pregnant. EHRC and Department for Business, Innovation and Skills research back in 2016 put a figure of 70% on this. Further, the same research found that a quarter of employers felt that it was reasonable during recruitment to ask women about their plans to have children, so clearly there is some way to go.

Tackling the challenge of pregnancy and maternity discrimination will require action on many fronts. That is why we committed to set up an employer and family representative group, which I want to make recommendations on what improvements can be made to the information available to employers and families on pregnancy and maternity discrimination. Rather than focusing on the end of the process, redundancy, I want the group to look at earlier stages of the employment lifecycle, because we need to shift the whole focus of the debate on pregnancy and maternity discrimination so that employers get it right in the first place, rather than focusing only on what happens when things go wrong. I want the group to develop an action plan on the steps organisations can take to make it easier for pregnant women and new mothers to stay in work and for them to progress throughout their careers.

We are having final discussions with business and family representative groups. Indeed, only the week before last, Maternity Action wrote to the Secretary of State for Business, Energy and Industrial Strategy on behalf of a number of trade unions and family groups to set out views on areas that might usefully be covered. This discussion is therefore very much a live one, and I hope to be able to announce the group’s membership and first meeting date soon.

I congratulate once again the hon. Member for East Renfrewshire on securing this important debate and for keeping this issue in the public eye. I started off by talking about how most employers realise the value of investing in their workforce and supporting them throughout their career. There are clearly actions that we need to take and issues we must address, as she and the hon. Member for Strangford (Jim Shannon) outlined eloquently. I look forward to working with the taskforce, seeing what it has to offer, listening to further debates both in this place and in responding to it and tackling many of these issues, as parliamentary time allows.

Question put and agreed to.

Draft Employment Rights Act 1996 (Protection from Detriment in Health and Safety Cases) (Amendment) Order 2021

Paul Scully Excerpts

Wednesday 28th April 2021 General Committees

[The Chair]

Before we begin, I remind Members to observe social distancing and to sit only in places that are clearly marked. I also remind Members that Mr Speaker has stated that masks should be worn in Committee. Hansard colleagues would be most grateful if Members could send their speaking notes to [e-mail].

[The Parliamentary Under-Secretary of State for Business, Energy and Industrial Strategy (Paul Scully)]

I beg to move,

That the Committee has considered the draft Employment Rights Act 1996 (Protection from Detriment in Health and Safety Cases) (Amendment) Order 2021.

It is a pleasure to serve under your chairmanship, Mr Davies. I will begin with some important background to the draft order, which was laid before the House on 17 March 2021. The UK is unique in having three employment statuses for employment rights—self-employed, limb (b) worker, and employee—when most other countries, including within the EU, have just the self-employed and employee categories.

Limb (b) workers have a more casual employment relationship than employees and are entitled to a basic set of rights, such as minimum wage and holiday pay. Limb (b) status allows for much needed flexibility in the labour market. Sections 44(1)(d) and 44(1)(e) of the Employment Rights Act 1996, which implements the EU health and safety directive into domestic law, give employees the right not to be subject to detriment by their employer for leaving or refusing to return to their workplace and the right not to be subject to detriment for taking steps to protect themselves or others in circumstances of danger which they reasonably believe to be serious and imminent.

In May 2020, the Independent Workers Union of Great Britain brought a judicial review against the Secretaries of State for Work and Pensions and for Business, Energy and Industrial Strategy. Following comprehensive proceedings, the High Court found in November 2020 that the UK had not fully implemented the EU health and safety framework directive into section 44 of the 1996 Act and that some protections applied only to employees, while the Court held that they should also extend to limb (b) workers.

The claim succeeded only in part, and the Court accepted that the UK was not required to extend unfair dismissal to limb (b) workers and had properly implemented the general obligations of the health and safety framework directive. The Government accepted the judgment and therefore proposes this draft order, which will extend the protection from detriment in health and safety cases to all workers, not just employees, as has previously been the case.

The Court also held that the Personal Protective Equipment at Work Regulations 1992 should also be extended to limb (b) workers, and I am assured by officials at the Health and Safety Executive that work is under way to consult on the regulations and to extend them to all workers through an additional statutory instrument due to be laid later in the year.

These important protections have proved even more essential for employees who have continued to work through the pandemic and for those returning to work as businesses emerge from the lockdown. They ensure that employees have the legal protection they need to act to ensure their own safety and the safety of others without fear of suffering detriment for doing the right thing. That includes protecting them against being denied promotion or training opportunities.

Having considered the Court judgment, we agree that limb (b) workers should also benefit from the protections. That does not represent a major change as limb (b) workers represent a small share of the workforce. However, it does not make it any less important, as such workers undoubtedly have a significant role to play in our economic recovery from the covid-19 pandemic. That is why the Government want to clarify the UK’s understanding of the health and safety framework directive by amending section 44 of the 1996 Act. We are committed to protecting workers’ rights and supporting workers through the challenges created by the pandemic, ensuring that the UK remains the best place in the world to work. Clarifying our interpretation of the directive in the light of the High Court judgment will mean that more people are protected by the provisions.

Turning to the scope of the SI, the changes made to section 44 of the 1996 Act will apply in England, Scotland and Wales, because employment law is devolved in Northern Ireland. We have, however, discussed this SI with the Northern Ireland Administration, who have laid legislation to the same effect, which will come into operation in parallel subject to the Northern Ireland Assembly’s procedure.

Given that the limb (b) workers represent a small share of the workforce, the direct cost to business of the change is expected to be very low. We also do not expect the amendment to have a significant and disproportionate cost or impact in any region across England, Scotland and Wales.

This is a necessary change in order to clarify the Government’s interpretation of the health and safety framework directive. It will ensure that all workers are covered by the protections and that we build back better from the pandemic by maintaining the highest standards when it comes to workers’ rights in the UK labour market.

--- Later in debate ---

[Paul Scully]

I appreciate the spirit in which this debate has taken place and the agreement on the reason for the court case. It is right that the courts were able to consider all the details of the case before coming to a clear conclusion. As I said, the claim succeeded only in part, with the High Court accepting that the UK was not required to extend unfair dismissal, for example, to limb (b) workers and had properly implemented the general obligations of the health and safety framework directive, and we chose not to appeal that judgment. It is important that the Court can do its work on interpretation to build up the case law. As I mentioned before, officials at the Health and Safety Executive assure me that work is much under way to extend protections under the personal protective equipment directive to limb (b) workers as well. To align with the Court ruling, there is no reason for further delay.

As for the employment Bill, I look forward to debating it with the hon. Gentleman and to working through the Bill when parliamentary time allows. We will see when that discussion happens. I do not have the Queen on speed dial, so we will have to see what happens on 11 May.

In conclusion, I underline once more that the draft order will help workers across the country during the coronavirus pandemic and beyond, providing all limb (b) workers and employees with the right not to be subjected to detriment in health and safety cases. I commend the statutory instrument to the Committee.

Question put and agreed to.

National Security and Investment Bill

Paul Scully Excerpts

Wednesday 28th April 2021 Commons Chamber

[The Parliamentary Under-Secretary of State for Business, Energy and Industrial Strategy (Paul Scully)]

I beg to move,

That this House disagrees with Lords amendments 11B and 11C.

The amendments made in the other place concern what is in effect a reporting requirement to the Intelligence and Security Committee in respect of the national security and investment regime. They incorporate the text of Lords amendments 11 and 15, which were considered in this House on 26 April. In addition, they would end the reporting requirements on the Secretary of State for Business, Energy and Industrial Strategy provided for by Lords amendments 11 and 15 should the memorandum of understanding that governs the remit of the Intelligence and Security Committee be amended to bring the Secretary of State’s activities under clause 26 into the scope of ISC scrutiny.

This House has already offered a view on the substance of amendments. It is disappointing that the other place has not heeded the clear and carefully considered message from this Chamber that the amendment to provide for a reporting requirement to the ISC is neither necessary nor appropriate. I welcome the Lords’ continuing attempts to find compromise, but I respectfully disagree with them. The Secretary of State has written to confirm plans for scrutiny with the Chair of the Business, Energy and Industrial Strategy Committee, the hon. Member for Bristol North West (Darren Jones), and the Chair of the Science and Technology Committee, my right hon. Friend the Member for Tunbridge Wells (Greg Clark). The ISC remains able to scrutinise the work of the intelligence services where it falls within the memorandum of understanding and in accordance with the Justice and Security Act 2013.

As we rapidly approach the end of this Session, it is essential that this vital Bill on the UK’s national security does not fall as a result of our failure to agree that the BEIS Committee will continue to scrutinise the work of the Department for Business, Energy and Industrial Strategy. I therefore urge the House to reject amendments 11B an 11C from the other place and reiterate its message about the will of this democratically elected House, to help ensure that the Bill becomes law without delay.

[Chi Onwurah (Newcastle upon Tyne Central) (Lab) [V]]

I again thank colleagues in the other place who have worked tirelessly to improve the Bill.

Labour is the party of national security and has long called for a new regime to deal with the evolving national security threat arising from mergers and acquisitions, as the Bill seeks to do. The Bill was much improved in Committee, as the Minister acknowledged in Monday’s debate; however, as Members from all parties highlighted then, it still lacks an appropriate level of oversight for critical national security decisions. Labour believes that Intelligence and Security Committee scrutiny is essential to provide the robust and sensitive oversight and accountability that matters of national security require. The Bill gives significant new powers to BEIS, a Department traditionally lacking in national security experience.

On Monday, as the Minister indicated, the Government rejected Lords amendments 11 and 15, stating that

“it is appropriate and sufficient for oversight and scrutiny of decisions made by the Secretary of State for BEIS to be conducted by their departmental select committee”—

that is, the BEIS Committee. The Lords have responded with amendments 11B and 11C, which would allow the Government to add the Investment Security Unit into the Government and ISC memorandum of understanding, thereby removing the obligation to provide the ISC with a confidential annexe.

We maintain our position: that the BEIS Committee does not have the security clearance necessary to provide scrutiny. In Monday’s debate, the Chair of the Committee, my hon. Friend the Member for Bristol North West (Darren Jones), said clearly that the Committee

“does not have the access to the intelligence information that it would need in order to adequately scrutinise the Investment Security Unit in the BEIS Department.”—[Official Report, 26 April 2021; Vol. 693, c. 164.]

As the Minister indicated, the Secretary of State has said that classified information could be shared with the BEIS Committee on a case-by-case basis, but the retaining, recording, discussing or reporting of that information after the fact would constitute a security breach, somewhat limiting the Committee’s actions.

In this afternoon’s debate in the other place, the Government said that they will “carefully consider” ways in which classified information could be provided so that the Committee can do its job. Why do we need careful consideration when we have, through the Intelligence and Security Committee, an existing and functioning mechanism for parliamentary scrutiny on issues of national security? Earlier this afternoon, the Government were again defeated in the other place, this time by an even greater margin, showing that, despite the Minister’s efforts, support for Intelligence and Security Committee oversight is growing. I feel that it is becoming an issue of intransigence and stubbornness—or, as former Conservative Health Secretary Lord Lansley put it today, “arrogance”—by a Government refusing to prioritise national security in the National Security and Investment Bill, and determined to overturn common sense for reasons that are unclear to us all.

It is clear to us that there is a need for Intelligence and Security Committee oversight. Indeed the Chair of the ISC, the right hon. Member for New Forest East (Dr Lewis), said:

“The setting up of the new Investment Security Unit in BEIS”—

a function of this Bill—

“is…precisely the situation that the Government assured the House”—[Official Report, 26 April 2021; Vol. 693, c. 157.]

would mean that there was ISC oversight, under the memorandum of understanding between the Government and the ISC. Today’s amendment provides for ISC scrutiny until an amended MOU resolves the confusion that appears to exist—on the Government’s part, at least.

If the Government are serious about protecting the UK’s national security through this Bill, they will not force through legislation with such a significant blind spot. Labour, the Chair of the Intelligence and Security Committee, the Chair of the Business, Energy and Industrial Strategy Committee, many Government Back Benchers and cross-party consensus in the other place all agree that the ISC is best placed to provide national security oversight. Why are the Government determined to stand alone in risking our national security in this case?

[Owen Thompson (Midlothian) (SNP)]

I will be very brief. Earlier this week, my hon. Friend the Member for Aberdeen South (Stephen Flynn) made the case very clearly that we broadly support the principles of the Bill, but still have concerns over the levels of scrutiny, as we have heard from other Members. We have attempted to be constructive at all stages, and have tried to support the Government to find a balance between the needs of business and national security, particularly in relation to small and medium-sized enterprises.

Many amendments have been accepted, which will help to achieve this; we welcome the Government’s steps in that regard. However, the scrutiny process remains vital and we are not yet satisfied that it has been taken fully into consideration. The comments made by the Chair of the ISC earlier this week certainly highlighted that. I urge the Government to heed those words and those of my hon. Friend the Member for Aberdeen South.

[Paul Scully]

I am grateful to hon. and right hon. Members for their contributions and considerations in this debate and others. I will make a couple of brief points in response.

The nub of the remarks made by the hon. Member for Newcastle upon Tyne Central (Chi Onwurah) was the question of whether the BEIS Committee will have access to top secret information. We will make sure that the Committee has the information it needs to fulfil its remit and scrutinise the work of the ISU under the NSI regime. Much of the information is unlikely to be highly classified, but where the Committee’s questioning touches on areas of high classification, it is likely that relevant information could be given in a way that does not require as high a level of classification, and that this could be provided to the Committee on a confidential basis. If, however, the Committee does require access to highly classified information, we will carefully consider how best to provide this while maintaining information security in close collaboration with the Committee’s Chair.

The Government’s main powers to scrutinise and intervene in mergers and acquisitions for national security reasons comes from the Enterprise Act 2002. The powers under the Act sit with the Secretaries of State for BEIS and for Digital, Culture, Media and Sport, not with the Cabinet Office. The BEIS Committee’s oversight of the new NSI regime is entirely in keeping with this and does not represent a reduction in the ISC’s remit, so there is no barrier to the Committee handling top secret or other sensitive material, subject to the agreement of the Department and the Chair of the Committee on appropriate handling.

This House should continue its excellent work of speeding this Bill towards becoming law for the benefit of the UK’s world-leading investment environment, as well as of protecting the nation’s security. I therefore urge the House to disagree with the Lords in their amendments 11B and 11C.

Question put, That this House disagrees with Lords amendments 11B and 11C.

Fire and Rehire

Paul Scully Excerpts

Tuesday 27th April 2021 Westminster Hall

[The Parliamentary Under-Secretary of State for Business, Energy and Industrial Strategy (Paul Scully)]

It is a pleasure to serve under your chairmanship, Mrs Murray.

I congratulate the hon. Member for Jarrow (Kate Osborne) on securing the debate, her first here in Westminster Hall, on fire and rehire. We have heard a lot of powerful and passionate speeches, but before I start on mine, I note that many of my colleagues have been glancing at the annunciator screens around us. Important issues have been debated in the main Chamber. I have seen colleagues on the Government Benches speaking about fire safety and veterans—a lot of issues. Many colleagues have spoken about this subject and will continue to do so.

We heard from the Opposition spokesman, the hon. Member for Bradford East (Imran Hussain), about the Government giving warm words, about consultation and about people being worse off. On the warm words, however, we agree on many things to do with the “bully-boy tactics” we have heard about today. That also demonstrates the difference when talking about businesses, because with changes to workers’ rights and anything to do with employment, whether for workers or businesses, it is important that we get it right. We have to consult and ensure that legislation is made with careful consideration and debate, and that it is made with people—companies and workers—and not done to them.

Clearly, the flexibility of our jobs market means that the hon. Member for Bradford East was right to say that people and their families are worse off if they get reduced terms. They would also be worse off, however, if their jobs were lost as a result of a different type of restructuring. Again, that is why we need to get the balance right.

We had some international comparisons. Many European countries clearly have more rigid labour markets. Often, in places such as Germany and France, more onerous requirements must be met when considering individual or collective redundancy. In some countries, permission must be sought even to go down that line. So our flexible hiring practice is important to ensuring that our economy is rounded but flexible.

Having said that, however, importantly, we are all constituency MPs and we have heard many examples today. From correspondence I have received—like many Members present—we know that, for those affected, the threat of redundancy or dismissal is always distressing. We expect employers to treat their staff with respect and compassion. That is even more important now, when people feel particularly vulnerable or anxious about the future. I speak to businesses every day and know that the vast majority of employers want to do the right thing by their employees. For most employers, the choice to let someone go is not something to be taken lightly. It usually comes at a time of great financial uncertainty for the business.

I pay tribute to all the businesses and workers that have kept the economy moving throughout an extraordinarily difficult time. In the face of those challenges, businesses have shown a remarkable ability to adapt and innovate. Through the pandemic, our priority as a Government has always been to protect jobs. Through the job retention scheme we have supported 11.4 million unique jobs to date. As we build back better from coronavirus, we will continue to support workers and work with employers to protect and create jobs. In the past year we have helped millions of people to continue to provide for their families as part of our plan for jobs, to protect, support and create employment. As we build back better we will work with employers to protect existing jobs and create new ones.

The Government are always on the side of working people, including those on the lowest wages. Earlier this month, about 2 million of the UK’s lowest-paid workers benefited from an increase in the national living wage and the national minimum wage, including a 2.2% increase in the national living wage, to £8.91—the equivalent of more than £345 a year for someone working full time.

[Gavin Newlands]

I hear yet more warm words, and I hear about the Government’s support for workers, the furlough scheme, and what have you. Let us concede the furlough scheme. However, what does the Minister say to workers who have taken redundancy when faced with fire and rehire threats, or who have been forced out of a business, or to the British Gas engineers sacked without any redundancy payment?

[Paul Scully]

I will come to fire and rehire. In individual company disputes, in the first instance it should always be ensured that the company and employers can have conversations and dialogues with the unions, should there be a union supporting the workers.

The debate has explored a lot of issues related to fire and rehire, where employers dismiss or threaten to dismiss employees, only to hire them again on less favourable terms and conditions. However, the UK already has a robust legal framework to ensure that employees are treated fairly. Employers are clearly free to offer the terms and conditions of employment that best suit their business needs, but they must always act fairly and not discriminate unlawfully, such as on grounds of race, sex or disability. Redundancy law requires that any redundancy process be fair and reasonable, with appropriate equalities considerations. Those rules include giving a notice period and consulting staff before a final decision is reached. We have clear laws on unfair dismissal, covering such things as the application of unfair selection criteria or failure to consider the possibility of transfer to other work.

However, it is not just a matter of what the law requires; it is in businesses’ own interests to have committed, motivated staff who are properly engaged in decisions about their future. As I have said, in the vast majority of cases businesses want to do the right thing by their employees, and I am determined to help them with that, to make sure that we find the best approach for employers and employees. However, we should tread carefully when considering Government intervention in commercial contractual matters between employers and employees. We must and do protect workers from unfair practices, especially when they put unnecessary stress on people who fear for their livelihoods, but we must also allow businesses to take the sometimes difficult decisions that are necessary to preserve their commercial viability.

Some Members have called this afternoon for the Government to legislate for a ban on fire and rehire. The Government have always been clear that we do not accept the inappropriate use by some employers of fire and rehire as a negotiation tactic. I have met Members and trade unions to discuss the issue, and in those discussions it has been made plain to me what anxiety and distress such tactics cause, particularly when individuals feel that they have no real option to say no and negotiate better terms. We have heard examples of that today. However, it is right and proper to consider the evidence, to avoid any course of action that would run the risk of doing more harm than good.

For example, it would be counterproductive if measures that prevented businesses from rehiring staff on different terms and conditions meant that a business could no longer survive, so that its staff found themselves out of work entirely. That would be the worst possible outcome for both businesses and the people they employ, so we need robust evidence to make robust policy decisions. That is why my Department asked ACAS to conduct an evidence-gathering exercise to learn more about the use of fire and rehire. Some Members of the House have continued to call upon my Department to publish this evidence, including during this debate. Let me clarify: we asked ACAS for its help in developing the evidence base on this complex and sensitive issue. We are carefully considering the different issues and viewpoints raised, which is vital for good policy making, and we will set out our steps in due course.

As mentioned today, unfortunately, due to the impacts of covid, some employers may be considering making redundancies. We urge employers to consider all options and alternatives before making redundancies, but we recognise that it is not going to be possible to save every business and every job. Collective redundancy legislation requires employers proposing to make 20 or more employees redundant from one establishment in a 90-day period to consult employees or their representatives, and that must include a consultation on ways to avoid redundancies, reduce their number, or mitigate their impact. Within the same timescales, the employer must notify the Secretary of State for Business, Energy and Industrial Strategy of the proposed collective redundancies. Failure to notify is an offence. Employees and/or their representatives may make a claim to an employment tribunal if they consider the employers not compliant with the consultation for collective redundancies. If the tribunal agrees, it may make a protective award of up to 90 days’ remuneration per employee. If a protective award is made against a company in liquidation, the Insolvency Service can pay the protective award, within certain limits.

In spite of the unprecedented support made available by the Government, many people have had to make really difficult decisions about their livelihoods since last March. This includes employers who have spent years investing in and growing their businesses, and workers who have shown loyalty and dedication to a particular profession or service. This debate has highlighted the challenges that everyone is having to face, and the enormous impact that losing a job or the threat of losing a job has on individuals and their families.

[Gavin Newlands]

I have heard all of that, and I have heard the Minister’s justification for not publishing the ACAS report thus far, but can he guarantee that at some point after the Queen’s Speech—in the next Session—the Government will publish the report in full, and what the Government intend to do about it?

[Paul Scully]

What I will say at the moment is that we are fully considering that, and we will continue discussion and debate on it, because it is important that that evidence base forms part of those policy-making criteria. Employers need to make sure that they can take the decisions they need to maintain their commercial viability during all of this, and as I have said, most businesses are doing the right thing. I have been an employer myself for the best part of 25 years before being elected, and I know what it is like to be responsible for someone else’s livelihood. It is deeply unfortunate, however, that the actions of some unscrupulous employers are tarring others with the same brush. Even at a time when businesses face acute challenges, fire and rehire should only ever be used as an option of last resort. As I have made clear repeatedly, it is completely unacceptable to use threats of fire and rehire simply as a negotiation tactic.

Once again, I thank all hon. Members, and especially the hon. Member for Jarrow, for their personal contributions to this debate.