United Kingdom Internal Market Bill

Debate between Richard Fuller and Drew Hendry

Tuesday 15th September 2020 Commons Chamber

[Drew Hendry]

This is the argument that Government Members try to propagate all the time—that if these powers came to Scotland, they would immediately be transferred to unelected people in the EU. Two things are wrong with that. First, nobody in the EU is actually unelected when they make decisions; they are all elected by either the Parliament or the people who go there. The second and most fundamental point is that, under these proposals, the UK Government are simply taking all control and overriding the ability of Members of the Scottish Parliament to do their job by representing the people who voted for them and their choices.

[Richard Fuller (North East Bedfordshire) (Con)]

rose—

[Drew Hendry]

I will make some progress.

The UK Government say that they want to

“guarantee the continued right of all UK companies to trade unhindered in every part of the UK.”

Under this proposal, businesses simply have to have deep enough pockets to challenge the democratic decisions of the Scottish Parliament and the Members elected by the people of Scotland to represent and make decisions further for them. For some, it will be “Sale of the Century” or “Bargain Hunt” as they go looking for these things. For those who set their sights on Scottish domestic choices, it does not stretch the imagination much to picture private health companies or private water companies operating in England looking at our publicly owned organisations and seeking to claim that, under the UK Government’s auspices, they have a guaranteed right to trade in Scotland. That is the first big flashing red light here.

[Drew Hendry]

Exactly; my hon. Friend makes a telling point. To say that the protections are opaque would be an exaggeration, because they are nowhere near as good as that.

[Richard Fuller]

I am keen, as I mentioned yesterday, to learn more about some of the points of view that the hon. Gentleman is expressing. In the absence of a common frameworks agreement, if it were not possible to get reconciliation between the constituent nations of the country on what the regulations should be, what would be the implications for business?

[Drew Hendry]

The problem with that question is that there is already, as I mentioned at the start of my remarks, a process for dealing with that—the common frameworks. I am saying that the UK Government do not have to take this hammer and smash devolution in order to organise things so that business can co-operate and work across the different nations of the UK, taking cognisance of the choices made by those nations’ individual Parliaments.

I turn to the composition of the Office for the Internal Market, and I would be grateful if the Minister intervened and gave me some answers to these questions. Who are these people? Who will sit down in judgment over the democratically made decisions of the Scottish Parliament? Do we know yet? Do we have any idea? These words from the Prime Minister—he was talking about the EU, of course—are coming back on him, as so many of his outpourings do:

“They may decide that now is the time—even though electorates are already feeling alienated from the political process—to hand sensitive decisions…to unelected bureaucrats.”

But that is what he has decided to do. He has decided to hand these decisions to unelected bureaucrats.

What grace-and-favour appointments will there be to this body? Will any of them have links to the many vested interests that apparently find it so easy to pick up contracts from this Government? The fact that that is something we can only guess at underlines how dangerous this proposal is for Scottish people and communities. We reject the idea of this body of unelected, unknown bureaucrats having power over the Scottish Parliament and the Scottish people.

The SNP has tabled amendments 28, 29 and 30, which are in my name and those of my hon. Friends. Amendment 28 would exempt from the operation of part 4, which deals with independent advice on and monitoring of the UK market, regulatory provisions applying in Scotland that did not apply to the whole of the UK. Via this amendment, the SNP wants Scotland to be removed from part 4 of the Bill, because it undermines devolution.

Decisions made by our elected representatives must be upheld, and this proposal to overrule the Scottish Parliament is a democratic outrage. Let us be clear that we cannot and will not accept this legislation in any form. Under the unelected Dominic Cummings, the Prime Minister is forcing this power grab through, despite overwhelming opposition from Scotland’s Parliament and MPs. It proves that Scotland will never, ever be accepted as an equal partner in the UK. It attacks the foundations of devolution and gives Westminster and an unelected quango a free hand to overrule the Scottish Parliament in devolved areas, threatening our NHS, our food and our environmental standards. It fires the starting pistol on a race to the bottom.

--- Later in debate ---

[Richard Fuller (North East Bedfordshire) (Con)]

Thank you very much, Dame Rosie—that was unexpected. It is a great pleasure to serve under your chairmanship, and to have the opportunity to raise some general points and specific questions relating to the clauses under consideration today.

Overall, I am very supportive of the Bill, but, as with any substantial change, caution, checking and prudence should be part of the Government’s process. When I look at regulations and regulatory frameworks—which perhaps I do a little too often—uppermost in my mind is the quality of the regulations or framework, their effectiveness, their relevance, and whether we have the correct allocation of decision authorities given the different parts of the United Kingdom or different groups for which the regulations are being made.

On that last point, I want to pick up on some of the issues that animated the hon. Member for Inverness, Nairn, Badenoch and Strathspey (Drew Hendry) and perhaps others in their questions about the choice of a common approach compared with a common framework. I should perhaps know more about this area, but it is alluded to in paragraph 8 on page 5 of the explanatory notes to the Bill, which states:

“As part of its vision for the UK internal market, the Government is also engaging in a process to agree a common approach to regulatory alignment with the devolved administrations. The Common Frameworks Programme aims to protect the UK internal market by providing high levels of regulatory coherence in specific policy areas through close collaboration with devolved administrations.”

Where is that in the Bill or today’s considerations? What is the Government’s current thinking around engaging in a process to agree a common approach as part of their vision, as the explanatory notes state?

I did not get an answer from the hon. Member for Inverness, Nairn, Badenoch and Strathspey to my question about how disputes would be resolved in a common frameworks approach, which seems like a fundamental issue.

[Drew Hendry]

I thank the hon. Gentleman for allowing me to make good my deficit in not answering his question fully. I am happy to try to do so now. I understand that before the Bill was introduced, the Joint Ministerial Committee, with Ministers on both sides, was working on a programme, with some success, I understand, by which all these issues could have been ironed out in a collaborative and consultative way with each of the Governments of the devolved nations, but that has now been torn asunder. I look forward to the answer to the question about how this collaboration will work in the future, given that the Bill simply overlays that with an unelected quango and the ability for the BEIS Secretary and this Parliament to make the ultimate decision.

[Richard Fuller]

I think I have the answer—it might not be the one he thinks he is conveying—which is, there is none. There is no answer to how disputes will be resolved because it does not appear that that has actually been achieved.

Corporate Insolvency and Governance Bill

Debate between Richard Fuller and Drew Hendry

Consideration of Lords amendments & Ping Pong & Ping Pong: House of Commons
Thursday 25th June 2020 Commons Chamber

[Richard Fuller (North East Bedfordshire) (Con)]

I draw the House’s attention to my entry in the Register of Members’ Financial Interests and in particular to my roles as a director of companies.

Like the Opposition, I welcome the changes that the Government are accepting in the Bill today. I have listened to a couple of interventions from the Opposition Benches, with their strong support for Government measures to support the economy, and that is emblematic of how successful they have been. However, I would just gently warn my hon. Friend the Minister that we have made great progress so far, but there are issues, as we emerge, about how those programmes are helping certain people, while other people are not receiving that support. We need to get the economy going back to normal business principles as quickly as possible, not seek to extend Government intervention unnecessarily or for too long.

This Bill is a very timely Bill and it is a good Bill. As the shadow Minister said, there is a mixture of short and long-term issues here, but getting this on the books is really rather important for the market. May I ask the Minister, building on some other comments about the changes in the role of the Pensions Regulator and the PPF, whether he sees this as part of a longer-term view of the Government about the role of pensions regulators in insolvency, and whether this is an indication of something that may outlast and be outwith any short-term changes? I would be interested in his perspectives on that.

I am not sure if the Bill continues to relate to the primacy of HMRC as a creditor in insolvencies, but I would be interested if the Minister has any observations on that. I know that, for many businesses when they are trying to seek resolution in insolvency, HMRC can prove to be one of the most difficult creditors to deal with—and that is putting it perhaps a little lightly. So do the Government have the intention of providing, or does the Treasury have any intention of providing, any guidance on how HMRC may be treating its obligations during this particular period? For many companies, that would be a welcome piece of information as they go through what may otherwise be very difficult periods.

May I ask the Minister about the extension to 30 September? That seems to be a very sensible change, but may I ask him about what happens in the event that there is a repeat lockdown that is a national lockdown? He has talked a bit about an affirmative decision here. That, it seems to me, is perhaps a bit more focused than that. Perhaps more tellingly, what happens in the instance where there is a localised lockdown in a particular county or a particular region that affects businesses there and they go insolvent? What happens to those particular businesses? I would be interested to see if the Minister has some thoughts on that.

My final observation, Mr Deputy Speaker—and you, with your great experience, may know this too—is that frequently measures that come into this House that are seen as short-term measures have a habit of sticking around on the statute book. So could I have, on the sunny-side view of the recovery of the economy, an absolute assurance from the Government that it is their intention, as these things sit, as the economy recovers, that they will implement the sunset clause, and they will come forward so that we can enable businesses to go back to the longer-term framework, some of which is in this Bill, for managing corporate insolvency?

[Drew Hendry (Inverness, Nairn, Badenoch and Strathspey) (SNP)]

Can I also thank the Minister for the collaborative and refreshing way, given his Government’s record, of engaging across the Benches to take this legislation through? I will come to my constructive criticisms in due course.

The areas I want to expand on are, basically, that we accept the Lords amendments and, within that, seek assurances from the Minister, his Secretary of State and his Government that they will work with the trade unions to ensure that workers are adequately protected, acknowledging that, while the Bill is a welcome step, the help it will give firms to get through the covid-19 crisis is going to be a drop in the ocean of the challenges they face. If this Tory Government are serious about reducing insolvency, they need to do much more. They should then support the Scottish National party’s amendments to the Finance Bill to prevent HMRC’s vulture powers from taking effect.

We welcome the technical changes made through the Lords amendments, not least the fact that the Scottish Parliament can play its full role in matters relating to clause 43. That is extremely welcome. It is also welcome to see the Government make concessions to Lord Stephen to ensure that directors will have responsibility for informing employees about moratorium arrangements and reassuring them about their conditions in the future. The Minister and the Government must provide assurances that they will continue to engage with trade unions and give an unequivocal guarantee that workers’ rights will not diminish as a result of the Bill.

The hon. Member for Newcastle upon Tyne Central (Chi Onwurah) was very kind in her criticisms. I am going to be a bit more direct. The swathes of Government amendments required in the Lords are indicative of the Government’s ongoing failure to grasp the details of the measures they propose—that is notwithstanding the very good engagement I have already referred to by the Minister here today. It is not the way to take such important matters forward.

As I said earlier, we welcome the measures, especially the provision of a short business rescue moratorium to protect companies from creditor action while options are considered; the new court-based restructuring tool; and new rules to prevent suppliers from cancelling contracts with businesses in an insolvency procedure. They are all helpful to business, as is the temporary suspension of the wrongful trading provisions to give company directors greater confidence to use their best endeavours as they continue to trade during this pandemic emergency, without the threat of personal liability should the company ultimately fall into insolvency. Importantly, we are keeping the existing laws for fraudulent trading and potential director disqualification to deter director misconduct—so far, so good.

The main and most pressing issue, however, is that these measures do not address the mountain of corporate debt that will prevent firms from investing to rebuild the economy. With reports that less than half the bounce-back loans will not be repaid, it is high time that recipients of the bounce-back loan scheme and coronavirus business interruption loan scheme debt were offered the chance of that debt being turned into equity instead. It is simply unrealistic to expect economic growth while numbing investment, crushing productivity and adding to corporate debt.

To be serious about avoiding insolvency, much more attention will need to be paid to the breadth of effects. Even businesses that survive will face a much longer road to recovery, especially in sectors such as tourism, hospitality and the arts. Without meaningful action, jobs will be lost and communities scarred, probably for decades. The effect on those sectors and others means that the brunt will be borne by thousands of people in the gig economy and on zero-hours contracts—and disproportionately by young people.

The Minister said that he wanted to make a commitment to supporting local economies. It is important that he takes that message back to the Chancellor because, when redundancies come, businesses will focus on those who will cost them the least to release: the low paid; those with no contract; and, as I have said, younger people. I have to declare an interest here as a father who still has two teenagers in the house, and, of course, as a newly-surprised grandparent of my new grandson Cameron Hendry. I want to ensure that all young people have a future to look forward to that is not going to be hampered by decades of retrenchment. [Interruption.] Indeed, Cameron Hendry. It is a fine name, isn’t it?

To get back to the serious point, although the hospitality sector is hopeful of some meagre income in the dying embers of the season, it has effectively faced a three winter situation. It may get 15% to 20% of that which July would normally bring, and maybe a bit more in August, if it is lucky. I have been engaging with and listening to the industry’s concerns, which are similar in tourist areas across the nations of the UK.

Current hotel occupancy rates seem to be below 10%. In my own constituency, the owner of the Kingsmills Hotel Group, Tony Story, told me that his company will have to bear the cost of an additional 15% to 20% per room for electrostatic spraying and hospital-grade cleaning in his hotels. That experience has been reflected by other smaller hotel owners across the sector.



They need the Minister, his Secretary of State and his Government to implore the Chancellor to extend furlough support in the sector beyond this year. As it stands, because of the changes—because of the contribution they will have to pay towards furlough—they will lose more money opening their businesses than when they were closed. It makes no sense to punish them in that way. The furlough scheme has been of great help; we have mentioned that many times and supported it. That is why it is important that it continues in order to avoid insolvencies that may come out of this.