Autumn Statement Resolutions

Robert Neill Excerpts

Monday 21st November 2022 Commons Chamber

[John Glen]

I cannot account for what is happening in Scotland, but there are £1.5 billion of Barnett consequentials from the autumn statement. I have been clear with the House that the workforce plan is designed to set out transparently where the gaps are, and obviously it will be for various Government Departments to respond to that.

[Sir Robert Neill (Bromley and Chislehurst) (Con)]

I welcome the pragmatic tone the Government have adopted in this autumn statement. On the NHS workforce strategy, will my right hon. Friend bear in mind not just those who provide hospital care but, as has been highlighted by the Stroke Association and others, those who provide therapy and care for people with strokes and other such afflictions after they have been discharged? Such therapy and care is how we will get many of these people back into productive work in the economy, thereby reducing costs and the human suffering caused by strokes and similar conditions.

[John Glen]

My hon. Friend makes a very wise point about the interaction between effective care and a vibrant NHS workforce. We know about the significant changes to the character of the workforce, and we know about the patients who are not fully engaged. We need to get into that so that many of these people get back into work.

The 1.6 million employees who work in the social care sector are working extremely hard. Local authorities have rightly expressed concerns about their capacity to deliver the Dilnot reforms immediately, so we will delay their implementation for two years, allocating the funding to allow local authorities to provide more care packages. Members will recognise that only by expanding the capacity of the social care system will we free up some of the 13,500 hospital beds that are occupied by those who could and should be at home.

The Growth Plan

Robert Neill Excerpts

Friday 23rd September 2022 Commons Chamber

[Kwasi Kwarteng]

We are backing the hon. Gentleman’s communities—by reducing taxes, by creating the potential for investment zones and through the energy intervention. There is a whole host of measures that are backing ordinary, hard-working people.

[Sir Robert Neill (Bromley and Chislehurst) (Con)]

I welcome much of the announcement, particularly the change to IR35. As the Chancellor will know, that has caused real distress and injustice to many honest, hard-working self-employed people. I also welcome the changes to stamp duty, but will he bear in mind—I am sure he does, as a Conservative—that we also believe in sound money and we must keep an eye on inflation? We do not want the benefit of the stamp duty cut to be eroded for many homeowners by increased mortgage costs.

[Kwasi Kwarteng]

Absolutely. My hon. Friend will understand that, historically, we have managed to get out of high periods of debt by growing our economy. That is why we have a renewed focus on growth. What we cannot do is simply tax our way to prosperity; that has never happened before.

Economy Update

Robert Neill Excerpts

Thursday 26th May 2022 Commons Chamber

[Rishi Sunak]

As I said, when it comes to all the direct payments through the welfare system, we will take legislative powers to deliver them directly in Northern Ireland, where we believe we have the operational capacity to do so. As for the support for energy bills in the autumn, we are open to exploring how best to deliver that support to those in Northern Ireland. Ordinarily it would be Barnetted—it is worth £165 million—because, as the hon. Gentleman will know, the energy market is separate to that in the rest of Great Britain, but if there is a way for us to deliver that support directly, we are open to doing so. We just need to see whether there is a mechanism to do so.

[Sir Robert Neill (Bromley and Chislehurst) (Con)]

The London Borough of Bromley has the highest percentage of pensioner households in the whole of Greater London, and my right hon. Friend’s well-targeted initiative will be very much welcomed by my constituents. Equally, of course, in the longer term, inflation is a threat to their pensions and fixed incomes. Will my right hon. Friend assure me that as well as dealing with the immediate pressures now, we will pursue a policy of non-inflationary growth? Above all, that must surely come from market and other reforms to improve our comparatively low level of productivity. Will he make that a priority going forward?

[Rishi Sunak]

My hon. Friend is absolutely right and I know that he is a champion for pensioners in his constituency. I hope that he will be pleased by today’s news that they will receive an extra £300 this winter to help get them through. His point about the long run is right. My belief is that if we can get businesses to invest more, train more and innovate more, spurred on by tax reductions and reforms this autumn, we will be able to drive up our growth and productivity.

Customs (Amendment) (EU Exit) Regulations 2022

Robert Neill Excerpts

Monday 14th March 2022 General Committees

[Sir Robert Neill (Bromley and Chislehurst) (Con)]

There are strong feelings about the protocol and the nature of the Brexit that we had. Today is not the day for those, frankly. This is a technical statutory instrument, which is there to achieve a specific purpose that, it seemed to me, the Minister set out well. Sensible points were made by the shadow Minister, which I am sure that the Minister will deal with, but we all agree that it is necessary to have the measure in place. At the end of the day, it is manifestly in the interests of business that goods should be able to be released from customs control and that there should be a means thereby of doing that through the receipt of a security. That is what the regulations do.

There may be broader concerns, and we might well have sympathy with them, but this is not a debate about that. I therefore submit that the sensible thing is to have those debates in the right place—that is not here—and to pass the regulations, which are necessary to ensure better business continuity and are to the advantage economically of people in Northern Ireland. The bigger picture is that that debate is not for now, on a technical statutory instrument.

Ordered, That the debate be now adjourned.—(Alan Mak.)

Public Service Pensions and Judicial Offices Bill [Lords]

Robert Neill Excerpts

2nd reading
Wednesday 5th January 2022 Commons Chamber

[Mr Clarke]

I thank my hon. Friend for his question; it is a good one. It is important to provide reassurance on this point. The McCloud remedy aims to ensure that where pension members are offered a different benefit to remedy the discrimination they have faced, they will be returned to the same financial position that they would have been in had they always been entitled to the benefits that they end up choosing. That reassurance should be clear. For the majority of individuals affected, there will be no change to the tax position. It is important to get on record that there will be no change for the vast majority, and that the Government will ensure that all the appropriate guidance is provided in good time so that people can make an informed choice and not worry about incurring any losses.

As well as giving our public servants fair treatment for the remedy period, the Bill will ensure that remains the case into the future. From 1 April this year, all the legacy schemes will be closed to future accrual. All eligible members will be placed in the 2015 reformed schemes or, in the case of the judiciary, moved to a new scheme. This guarantees that members within each scheme will be put on an equal footing. It also underlines the Government’s commitment to the 2015 reforms and the principles that underpin them. Those principles are greater fairness between lower and higher earners, fairness for the taxpayer, future sustainability and the affordability of public service pensions as a whole.

The Independent Public Service Pensions Commission also recommended that the new 2015 public service pension schemes should include a cost ceiling to protect the taxpayer from unforeseen cost increases. However, the Government have chosen to go a step further in establishing a symmetrical cost control mechanism. This will not only protect the taxpayer from unforeseen increases in pension scheme costs but protect the value of pension schemes for members when costs fall.

On how the remedy in the Bill will interact with the cost control mechanism, it will give members a choice between two sets of benefits and allow them to choose which will be better for them. The result is an increase in the value of schemes to members, and, as is usual, this is managed through the cost control mechanism. Crucially, however, to ensure that no members’ benefits are cut as a result, the Bill includes a measure to waive any result from the 2016 valuations that would otherwise have led to benefit reductions. That goes to the point made by my hon. Friend the Member for Gloucester (Richard Graham). In addition, the Government have committed to honour any benefit increases that are due.

Hon. Members will be aware that, in the light of concerns that the cost control mechanism was not operating as originally intended, the Government Actuary was asked to conduct an independent review of this particular element. Following that review, and a public consultation last summer, the Government confirmed that three changes would be made to the mechanism. All three changes are recommendations from the Government Actuary.

The first change is to implement a reformed scheme only design. This means that the cost of legacy schemes will no longer be included in the mechanism. The second is to widen the margin of the cost corridor, which triggers a correction, from 2% to 3% of pensionable pay. The third change is to introduce what is called a symmetrical economic check. This economic check will ensure that any breach of the mechanism is implemented only if it would still have occurred had the impact of changes to long-term economic assumptions been considered. These reforms will make the mechanism more stable and ensure that it operates more in line with its objectives of protecting the taxpayer and providing stability and certainty on member benefits and contribution rates.

I therefore wish to notify the House of my intention to table amendments before the Committee stage, to set the framework for implementing a reformed scheme only design and the economic check. The wider 3% corridor will be implemented through secondary legislation in due course. This approach will ensure that the reforms are in place in time for the next scheme valuations. That is important to ensure that the mechanism is operating more in line with its objectives to protect both taxpayers and members the next time it is tested.

As I have explained, the Bill builds on the existing legislative framework for all public service pension schemes. Each scheme is complex, because each one is tailored to fit each workforce’s individual requirements. The Government intend the Bill to reflect those differences, many of which are found in the detail of scheme regulations. Additional detail will therefore come before Parliament in the form of statutory instruments for further scrutiny. To demonstrate the approach to secondary legislation, policy statements have been deposited in the Library of the House for further scrutiny.

Let me now turn to the next element in the Bill, the package of reforms to help to address the resourcing challenges facing the judiciary. Our justice system is world renowned for its excellence, objectivity and impartiality. That is due in no small part to the expertise of our court and tribunal judges, our coroners and our magistrates. However, as the demands on our courts and tribunals have changed, so too has the need to recruit and retain judicial office holders. While we have recruited about 1,000 judicial office holders a year since 2018, we have not been able to attract the full number needed across all courts and tribunals, which has inevitably put pressure on the system. Raising the mandatory retirement age to 75 will, our modelling suggests, retain about 400 judges and 2,000 magistrates per year at a time when we face challenges in resourcing and recruitment.

It is vital that we continue to attract and retain high-calibre judges. The Bill therefore lays the foundation of a new, reformed pension scheme for judges, increases the mandatory retirement age of judicial office holders to 75, and extends the potential for sitting in retirement to the fee-paid as well as the salaried judiciary. It puts judicial allowances on a firmer legal footing, including those for reserved and excepted posts in Scotland and Northern Ireland. I assure the House that the UK Government will engage with the respective devolved Administrations before the introduction of such allowances.

Taken together, these measures will ensure that a judicial career is more attractive, that more of our experienced judicial office holders are retained for longer, and that additional flexibilities are offered. It is vital that we enable our world-class judiciary to meet the demands of today and tomorrow.

[Sir Robert Neill (Bromley and Chislehurst) (Con)]

I entirely support what the Minister says about judicial pensions reform, but, since he wears another hat in his capacity as Chief Secretary to the Treasury, may I raise a further issue that is sometimes an impediment to recruitment, namely the operation of the lifetime cap on pensions earnings? In particular, many who have earned well at the Bar and who might otherwise seek appointment to the High Court bench still encounter a disincentive because of the operation of the overall lifetime cap. At one point a carve-out was arranged to reflect that. Although this does not feature in the Bill, may I ask the Minister to take it away and perhaps speak to the Chancellor about it? It is the final bit of the jigsaw that could be sensibly introduced to encourage the very best people to seek appointment to the bench.

[Mr Clarke]

As Chair of the Justice Committee, my hon. Friend brings a huge amount of expertise to bear on this issue. I can make an absolute commitment that we will look at this, and I will always discuss plausible options to ensure that the judicial pension scheme supports recruitment rather than being in any way an impediment to it. That is very important, and it underpins our wider work on the new scheme for the judiciary. It will move from being tax-registered to being tax-unregistered, and a variety of consequential benefits will arise from that.

--- Later in debate ---

[Sir Robert Buckland (South Swindon) (Con)]

Thank you, Madam Deputy Speaker, for calling me first in the debate. I am delighted to make a contribution to the Second Reading of a Bill that was very much part of the work that I undertook as Lord Chancellor. I was keen to make sure that we made progress with the Bill on several grounds, the first of which was the necessary reform to judicial pensions in light of the McCloud judgment and other legal developments since the previous set of reforms to judicial pensions. The second was the important and generational issue of retirement age for judges. The previous reform to that retirement age had been back in 1995, and it was not of immediate application but took many years to come into effect, bearing in mind its adherence to non-retrospectivity. I took a different view about the way in which we should approach reform this time. I felt very strongly that any change to retirement age should have immediate effect, and that it should benefit those currently in judicial office. I make no apology for that, because with welcome changes and elongations to lifespan, health and wellbeing, I thought that we were losing many talented men and women at the height of their career. I am not going to name names, but there are many people who served in the highest judicial office who left at the age of 70, but who I felt had much more to give. Some of them were able to carry on in retirement, sitting with special dispensation, but I felt that we needed to do something generational. I very much hope that the change that we are bringing about in the judicial retirement age will endure for many years, well into the middle part of this century. We are not saying that people have to sit at 75. We are not forcing people to sit beyond the time they wish to serve, but we are giving them an opportunity to do that.

Can I deal head-on with diversity, because I considered that matter very carefully indeed when I was Lord Chancellor? I have had the privilege of serving on the judicial diversity forum, which is a committee of the Judicial Appointments Commission, ably chaired by Lord Kakkar, and we take the issue of diversity very seriously indeed. In the other place, amendments were tabled to reduce the age of retirement to 72, on the basis that there were concerns about slowing the increase in diversity, but I believe that that worst-case scenario is based on a failure to act. In other words, it is incumbent on the Ministry of Justice, the Judicial Appointments Commission and others interested in and passionate about diversity to do more to attract people of diversity to the judiciary.

In particular, many women have had career breaks to bring up their family in their 30s and 40s. At the moment, they face quite a difficult decision to return to practice, and regard a 70 age limit as inhibiting their ability to take up part-time, then full-time, judicial office. Increasing the age limit to 75 will allow more women who have had career breaks actively to consider what is a career of up to 20 years if they are to enjoy the full benefits of the pension.

We should not forget that in 1995, one of my predecessors, Lord Mackay, not only reduced the pension age but increased the time that people had to serve to take their full judicial pension from 15 to 20 years. That combined decision had quite an effect on the career opportunities presented to lawyers when considering whether the bench was for them. In other words, people really had to make up their mind in their 40s if they were serious about reaching the bench. There are plenty of exceptions—some people who have done very well in their profession could go to the bench later and perhaps take a smaller pension—but many people felt that they could not take full advantage of a judicial career because of that time restriction.

That changes with a retirement age of 75. People can come to the bench in their mid-50s and serve the full 20 years. That is a huge opportunity, not just for women but for people who come to the legal profession slightly later in their career, mainly because the financial burdens are so onerous in their younger years that they do not feel able to join it in the first place. Contrary to suggestions in the other place and elsewhere, the measure could be a spur to the Government and the Judicial Appointments Commission to do even more to attract women, people from an ethnic minority, and people who join the profession late to a judicial career.

[Sir Robert Neill]

Can I perhaps reinforce my right hon. and learned Friend’s point? He may have noted from the statistics released by the Judicial Appointments Commission that there has been a particular shortfall in appointments to the district bench and the circuit bench in recent rounds. Those are precisely the people for whom the ability to access a full pension is important. As my right hon. and learned Friend said, the high-earning silk who goes into the High Court may be able to deal with a lesser amount of pension, but the people I am talking about, who are the workforce, particularly in the criminal and family courts—the senior juniors, the senior solicitors—will be under the most pressure if they are not able to get the 20 years’ full pension. That will be most difficult for them.

[Sir Robert Buckland]

My hon. Friend makes a really powerful point. There is no doubt that the district bench is under huge pressure at the moment. We are not getting the recruits and the applications that we need in order to have a full district bench. The work is some of the most difficult and challenging in the judiciary; it is unglamorous work, but it is vital because it is the bulk, for example, of the civil and family work that goes on in our courts day after day. We have increasing numbers of recruitment competitions seeking to attract more talented people to the bench, but often the vacancies cannot be filled, because there are not enough applications. That, frankly, is a problem. That is why not only the extended retirement age but the changes to the pension will really send a signal to practitioners that the Government value the judiciary and understand the vital importance of having the quality, independent and high-morale cadre of people we need. Without them, we really do suffer as a country.

I should have declared an interest at the beginning, in that I am the recipient, potentially, of a judicial pension because of my service as a recorder of the Crown court, which finished, of course, on my appointment as Lord Chancellor. That is another story, which I will not regale the House with today, but I did have to resign from the judiciary on my appointment as Lord Chancellor. That was not always the case prior to the Constitutional Reform Act 2005, and I think hon. Members know my strong views about the baleful effects of that piece of legislation. I am sure that, with leadership in the Ministry of Justice, we can come back to those issues, and that was certainly my intention when I was in office. However, I parenthesise.

Let me come back to the germane issue of the retirement age. I note the concerns that the senior judiciary and immediately retired judges in the other place had about the 75-year mark. However, I would respectfully but firmly disagree with them. Some 67% of respondents to the consultation agreed with my ultimate decision, which was to raise the retirement age to 75. The bulk of circuit judges, sheriffs in Scotland and other judges considered that the position absolutely pointed in the direction of 75. With the greatest respect to senior judges, many in the senior judiciary have already made their plans and their provision clear, and I do not expect that all of them will wish to serve until 75, bearing in mind the expectation prior to the expected change in the law. Therefore, I am not so persuaded that the logjam that some fear will take place, and I see no reason why there should not be a rise in the retirement age to 75, despite the concerns expressed in the other place.

I am particularly pleased that there was unanimity across the three jurisdictions that 75 was indeed the appropriate retirement age. I took a lot of time and trouble to make sure that colleagues in Northern Ireland and Scotland were consulted. I was extremely grateful to the then Lord Chief Justice of Northern Ireland, Sir Declan Morgan, for his careful consideration of the matter and for all the consultations I undertook with him, and indeed to the President of the Court of Session, Lord Carloway, who himself undertook extensive consultations with the Scottish judiciary. I was very grateful to colleagues in the Scottish Government for agreeing with the position that I sought to take with regard to the retirement age, because I thought that a cross-jurisdictional, pan-United Kingdom retirement age was highly desirable, bearing in mind the fact that atop it all sits the United Kingdom Supreme Court, with the members of that court therefore able to enjoy the same retirement age limitations irrespective of jurisdiction. That was a very important consideration that I am extremely grateful to colleagues in the other jurisdictions for agreeing to.

We have reached a position where we have come to an elegant solution: one that allows professionals to make decisions that suit themselves within that outer limit of 75 and acknowledges the reality that we see now, where the Lord Chancellor is constantly asked to allow judges to sit in retirement post 70—up to 72, in any event. It acknowledges the fact that, thanks to modern science and medicine, we have an increasingly agile and able cadre of people in their early 70s who are willing to serve. In the light of other societal changes—in the light of the fact that, thankfully, we are able to do more things at a greater age than perhaps we were a generation or so ago—I warmly commend the increase in the retirement age, in particular to the age of 75, to this House.

When it comes to the magistracy, we have suffered quite a decline in numbers in recent years. It was not so long ago that we had 30,000 volunteer magistrates—let us not forget, these are volunteers—sitting and serving in our courts. That number has declined alarmingly, and therefore it seems to me a matter of very good housekeeping for us to make sure that we can retain as many magistrates as possible while encouraging the excellent recruitment exercises that the Ministry of Justice is undertaking at the moment. The MOJ is to be commended on the vigour and focus of the exercises it is currently conducting, but without that additional help, my worry is that we are going to reach a critical position with regard to the number of justices of the peace that would undermine the viability of the system. That, frankly, would be a real problem, particularly in the family proceedings courts, where the lived experience, good judgment and common sense of magistrates is brought to bear on a variety of very difficult and complex family situations every day of the week.

This Bill was something I wanted to see even more urgently. I am glad that it is getting its Second Reading in early January: if I had had my wish, it would have received Royal Assent by now, but I understand that my ministerial colleagues in Government have to work to timetables, and that they themselves have different and conflicting priorities. However, it is an important signal that we are sending to the judiciary and to other public servants: not only that the Government take the judgments of the courts very seriously but, I hope, to make the point that any perception that this Government are somehow at war with the judiciary—that they somehow see the judiciary as enemies of the people, or think of them as an inconvenient encumbrance—is thoroughly dispelled by measures such as these.

Without a world-class, independent judiciary of quality, this country is no longer a civilised place. Without the important input of robust judicial independence, none of the jurisdictions for which we sit could call themselves world leading. It is vital that in this world of conflicting and competing calls for international investment, we have the brightest and the best from our legal profession serving in judicial office, because that is the most eloquent way in which we can express to the world the fact that Britain and the three jurisdictions are safe and secure places in which to invest, safe places in which to live, and free and fair places in which we can all be equal under the law. I can perhaps be accused of labouring the point, but I think that this sort of measure, detailed and technical though it is, embodies our commitment to that essential quality. That is why I am delighted to endorse the Bill on Second Reading and look forward to seeing it make a swift passage through the House.

--- Later in debate ---

[Sir Robert Neill (Bromley and Chislehurst) (Con)]

It is a pleasure to follow the right hon. Member for Hayes and Harlington (John McDonnell). He brings detailed knowledge of these matters to the debate, and although we do not always agree, it is always interesting to listen to the careful arguments that he deploys on pensions matters. I remember that from my time as the junior Minister responsible for the local government pension scheme.

I note the points raised by my right hon. Friend the Member for Newark (Robert Jenrick) about the potential conflict between a boycott, divestment and sanctions approach involved in taking a political attitude to pension schemes and the fiduciary duty of the trustees of those schemes to their members. That is something that we will return to, but with no disrespect to other Members, I want to concentrate on the elements of the Bill that concern judicial pensions and the retirement age, which obviously engage my interests as the Chair of the Justice Committee.

I will not repeat much of what has been said with great eloquence by my right hon. and learned Friend the Member for South Swindon (Sir Robert Buckland), who made the case very clearly. I welcome what the Government have done, as it was clearly right to respond to the McCloud judgment, and I am glad about the way in which they have done so. It is also good news that the Bill brings an even-handed approach to fee-paid judicial office holders—recorders and deputy district judges, for example—so that they are on a much more equitable basis with the full-time judiciary. That is a sensible approach.

By and large, the changes are welcome and necessary, but I hope that the Minister will take away the point about the interaction of the annual cap and the lifetime cap, which is particularly important to those who tend to be appointed to the High Court bench. Generally, those people are drawn from high-earning, highly experienced Queen’s Counsel and senior partners in solicitors firms. The reality is that we have to make it worth their while to undertake what is a public service in the latter stages of their career. Having been successful in practice, almost inevitably they take an income cut to go on the bench. There should not then be a tax penalty on top. If we want the very best on the bench, especially in the commercial court and other specialist jurisdictions, which have a reputational and financial value for the United Kingdom because our judicial system is a centre of excellence and venue of choice for high-value litigation, we have to make sure that we always get the very best to sit in those jurisdictions.

I want to deal with the issue of the retirement age, particularly the impact that that has elsewhere in the system. The Justice Committee considered the legitimate point that has been made and referred to about the impact on diversity of increasing the retirement age to 75. It is a fair point to make. There is no doubt that 70 is too low. The world has changed massively since the time when, as has been observed, Lord Denning was sitting into his 80s. Happily, many active 70-year-olds are well able to continue to contribute in many areas, and the judiciary should reflect that, as much as this House and anywhere else. My right hon. and learned Friend the Member for South Swindon rightly, prompted by others and by me, some time ago increased the age at which jurors can sit to 75. The burdens on people serving on a jury, even in a long case, are nothing like those for a full-time judge, but it is significant that we accepted—and the House accepted—that decision makers, in fact, could continue perfectly reasonably until 75. There is no reason, for example, why that should not be the case for the magistracy as well. I can think of many able magistrates whom we have needlessly lost at an artificial cut-off age of 75.

The same applies to the bench. One can think of a number of distinguished former members of the High Court and the Supreme Court who have had to retire at 70, with many years of service still to give, and still do so, often sitting as arbitrators in important areas of commercial litigation and mediation. I am glad that they can do so, as they perform a great service, but many of them would be happy to continue in public service as justices in the High Court and the Court of Appeal. We are therefore right to reflect societal and medical changes that have taken place.

The concern about opening up vacancies was debated at some length in the other place. As I say, it engaged members of the Select Committee, and a majority expressed concerns about it. I speak for myself in this regard, as I think that 75 is the right age in the circumstances. I am persuaded by the majority of respondents. I am conscious that a number of those in the senior judiciary would have gone to the age of 72, but it is currently possible to make a business case on an individual basis for members of the judiciary to sit until they are 72, so I do not think the difference is great.

The impact assessment indicates that the potential diminution in diversity opportunities is minor in reality. As has already been observed, there is a great gain in particular for women practitioners who have taken a career break and have therefore not necessarily had the opportunity to gain sufficient seniority within the professions to qualify for appointment, but who will be able to serve for the full 20 years required to qualify for the full judicial pension.

As my right hon. and learned Friend the Member for South Swindon observed, in essence we had a reduction of the age to 70 and an uplift in the number of years that had to be served from 15 to 20—in other words, if someone was not on the bench by the time they were 50, they would not get their full pension. As I observed in my intervention, those at the very high-earning end of the Bar and the solicitors’ profession may well have made other provision in that regard during their earnings in practice, but it is of particular value for the people who are—I hope they will not regard my use of this phrase as in any way disrespectful—the real workhorses of the system, who sit in the Crown court and the county court, to have the full judicial pension. Those on the circuit bench and the district bench take on the vast volume of judicial work and generally—certainly in crime and family work—will have largely done publicly funded work so will not have been in the position to put by great provision for the future while they were in practice but will none the less have undertaken important, critical work in the latter stages of their career and have a reasonable expectation of being able to serve the full 20 years to get their pension and to bring their expertise to bear.

It is significant that in the latest recruitment round there has been a shortfall of around 49 in respect of recruitment to the district bench. The vacancy rate in the latest round was 106, and 57 appointees were recommended for appointment to the district bench, and in the circuit bench there were 63 vacancies and 53 were recommended. Despite the excellent work done by the Judicial Appointments Commission, there is a shortfall—the Lord Chief Justice indicated recently in evidence to the Justice Committee that it is a continuing shortfall—in those key areas that deal with the vast volume of serious work: crime, family and civil. It is important to give people the opportunity to serve that much longer in terms both of judicial people power, if I can put it that way, and of making the career prospects attractive.

We do need to make the judiciary more diverse and more representative, but the way to do that is not to keep down the retirement age to such a low level that able people are needlessly lost to judicial service. We must redouble our efforts to attract people from diverse backgrounds and particularly from some ethnic minorities. The truth is that it varies, because it is not a homogeneous issue: the Select Committee heard compelling evidence that some minority groups are much more willing than others to consider a career in the law and in the judiciary. Let us do more to reach out right across the board to engage other groups and let us reach out to get more women to return. There has already been improvement on that, particularly in the magistracy and elsewhere, but there is more to be done.

We must of course encourage people to advance up the judicial ladder and to recognise that to advance from, for example, the district bench to the circuit bench and then into the High Court is something that is open and to be encouraged for all. I commend the work of the noble Lord Kakkar and his colleagues on the Judicial Appointments Commission in that regard. They recognise that we can always do more, and we as a House would recognise that, as would the Minister and his colleagues. We should not accept that the commitment to diversity that we all share, and our equal commitment to excellence and to having the very best people available to serve on cases which, after all, at almost every level change people’s lives to a greater or lesser degree, mean there must be an either/or trade. It is perfectly plausible and viable to have both, and that must be our objective. I therefore think that, on balance, we have the right position. I am conscious that I differ from some Members of the other House, who, as lawyers, I greatly respect. Equally, however, other highly experienced lawyers in the other place came to a different view. I am persuaded on this occasion, not for the first time, by the noble Lord Mackay of Clashfern, who reduced the age to begin with. If James Mackay is prepared to do a John Maynard Keynes and say, “The facts have changed; I have changed my opinion”, that is probably good enough for the rest of us and it certainly is for me.

On balance, I think the Government have got this right. I am sure that we will return to it on Report but, overall, this is a good measure. I hope that it is a part of package that we must have to make a judicial career attractive. I say to the Minister—this is strictly outside the scope of the Bill, but I hope you will indulge me, Mr Deputy Speaker—that it is not just the pensions that matter, but the tax treatment, as I mentioned, and, as the Minister is responsible for the courts, the working conditions, including the maintenance of the courts, the support that judges get from court staff, some of the lowest-paid in the public sector, and making sure that there are not leaks in the corridor and that the heating does not break down, as he and I know happens in some Crown courts. It is also about ensuring that there is general public respect, which we can all have for the judiciary at every level. All of us, whether we agree with any individual decision, should treat the judiciary at every level with the utmost respect because they are fundamental to the maintenance of our democracy just as much as this House is.

I hope that the House will pass the Bill swiftly and send it forward to an early Royal Assent.

Financial Services: UK Economy

Robert Neill Excerpts

Thursday 9th December 2021 Commons Chamber

[Anthony Browne]

I very much agree. I was coming to this point. If we can get those elements into trade agreements, we should aspire to do that. However, often, regulatory agreements between regulators are more appropriate.

[Sir Robert Neill (Bromley and Chislehurst) (Con)]

Does my hon. Friend agree that in addition to the importance of financial services in trade deals, it is important that we are aware of supporting other professional services that go with them, such as law and accountancy? The legal underpinning and enforceability of our financial services deals is critical going forward.

[Anthony Browne]

I fully agree with my hon. Friend. I have been focusing obviously on financial services, but there is the wider concept of financial and related professional services, including legal services. As he knows far better than me, London and the UK are a global centre for legal services. That is a huge export industry in its own right and we should do what we can to promote that internationally.

I was just talking about the importance of the relationship between the UK and Switzerland. We have a lot to gain by working more closely together. That is why I am delighted that the Government are working towards an outcomes-based mutual recognition agreement with Switzerland. I emphasise that it is outcomes-based because it is pragmatic and we share that pragmatism. Similarly, we can have an ambitious agreement with Singapore and other jurisdictions, such as Japan and South Korea.

I am pleased that the Government are working closely with the United States to remove barriers to financial services trade between us. We have some agreements and we could have more. The Government are doing the same with Australia, Canada and New Zealand. Coming to the point about trade agreements that my hon. Friend the Member for Bromley and Chislehurst (Sir Robert Neill) raised, I welcome the agreement in principle on the UK-New Zealand free trade deal, which facilitates cross-border data transfer and recognises the importance of allowing firms to offshore back-office functions. Those are both important for financial services.

We can promote financial services through trade agreements and mutual recognition agreements between regulators to the benefit of both sides. The Government must continue to work closely with our partners through the G7, the G20 and the Financial Stability Board to ensure consistent international standards. As the most globalised of all international financial centres, we are more impacted by global inconsistencies on standards than other jurisdictions.

[Sir Robert Neill]

My hon. Friend makes an important point about co-operation between regulators and agreements between regulators. Does he agree that that is particularly important in the context of dealing with the United States, where much of the regulation takes place at the state, rather than federal level? Therefore, it is not easily embraced in a straightforward, normal type of free trade agreement.

[Anthony Browne]

My hon. Friend makes an incredibly valid point. I know that the UK Treasury has spent a lot of time wrestling with the relationships with the United States, which is in many ways almost unmanageable, because it has 50 different state regulators, and the federal regulators answer to Congress, rather than to the Government, so agreements between Governments may not have an impact on the regulators themselves.

In conclusion, we are at a turning point for Britain’s financial services industry. In the past decade, we have faced the major challenges of the global financial crisis and Brexit, and we took the steps necessary to forge through both of those. We can now look forward to a new era of financial services, with new opportunities. We need to make sure that the UK is the undisputed leading international financial centre, both globally competitive and serving communities and consumers across our country, and exporting more, creating more jobs, funding more businesses and paying more tax. That is something we should all welcome.

--- Later in debate ---

[Dame Angela Eagle]

I can see the Minister is nodding, possibly because he recognises some of those tensions, which always existed when we were in the EU.

When we were in the EU, because of the size of the influence of the UK financial services industry as part of that bloc, we had a very good and effective way of pulling at least a lot of the regulation that went on more towards our way of doing things. One of the worries I have post Brexit, which I suppose is a philosophical and practical worry, is that the EU will now go off and do a lot more of the things that we were able to persuade it not to do when we were a member. The divergence between how EU regulation works and how we may wish our future regulation of financial services to work is likely to grow larger.

It has not been a very friendly divorce to date, and there may well be implications to that, too, in terms of competition for business. We have seen some of that in the wholesale markets for euros and we will doubtless see more of it. The outcome of our way of leaving the EU will challenge some of the agreements that we came to and the influence we were able to have when we were inside the Council chambers, the European Parliament and the European Commission, rather than the situation we find ourselves in now. As the hon. Member for South Cambridgeshire said, that can be an advantage, but it can also be a disadvantage. It is an opportunity, but there are also threats and issues that we have to deal with. We have a sharp disjunction with the recent past, after 40 years of that kind of influence, that we will have to deal with in the coming period. We have the inadequacies of the non-existent deal on financial services, which was part of the EU-UK so-called trade agreement, and those are already having an effect.

The hon. Gentleman was right to say that we are in a period of rapid regulatory change, which would have been the case regardless of whether we left the European Union. The fact that we have, and the fact that we have onshored all this regulatory machinery, means that we now have to start looking at how we wish to change all of it.

Even thinking about the sheer weight of work and oversight that will have to be done by the Treasury Committee is quite overwhelming, as the hon. Gentleman acknowledged in the exchange we had during his speech. The Minister must go weak at the knees when he thinks of the detailed work that he will have to put in to deal with the onshoring in the aftermath of Brexit, and whether we want to move quickly or slowly to adapt the laws and regulations that we have imported.

Members of the Treasury Committee have also gone weak at the knees thinking about how they might have some oversight, because of the highly technical nature of much of that regulation. We certainly need to be significantly more tooled up than we have been if we are to have proper oversight of what the regulators are tasked with doing, what philosophical direction the Government wish to go in, and what the practical aspects of that method will mean for our financial services industry and, of course—they have not been mentioned much—for consumers in the UK and for financial stability.

We should not lose sight of those two basic reasons why we have to get regulation right. Consumer protection is a huge issue in financial services, as the hon. Gentleman touched on when he said that financial services are not always the most popular sector of our economy. Perhaps some of those who supply and form part of the industry ought to stop and think about why that is they case and do some self-reflection about it.

Clearly, financial stability is also crucial in an era when markets are becoming more rapid and more global. In the context of highly rapid technical change, financial stability becomes even more important, because innovation outruns the capacity of many regulators to keep up with what on earth is going on in some markets. Those two important issues have to underpin all regulation; the future of the entire financial services industry rests on them.

Regulatory change in a rapidly evolving situation with a lot of flux is inevitably difficult for those who participate in the market and for those who wish to regulate it. It is also difficult for those such as the Minister who want to see how it can be properly harnessed and allowed to be beneficial to our economy while being safe. It is a period of big uncertainty and flex. New technology has the capacity to change things and lead to innovation, some of which might be fantastic and some of which might be awful. That structural issue has hit us greatly through the innovations of digital currencies.

The systems that control financial services have to deal with the practical and philosophical issues that arise, such as whether digital coins are ever stable, what central banks ought to be doing to deal with that, and whether the wild west of Bitcoin and the rest should be left as a gambling thing on the side. Those markets can be volatile—the wild west—but the capacity of software such as open registers and blockchain, and their potential for transparency and in-time and open trading of all sorts of things, could be harnessed for good purposes as well as for the more nefarious ones that feature on the darker edges of the net. On top of that, the demands of climate change will cause a systemic change in the way that things are valued, priced and assessed for value.

That structural change will completely change the context in which the financial services industry has to exist. In the UK, which is one of the most open economies in the world and always has been, we know how important the financial services sector is, and not only to London as a global centre. In 2020, it was worth £164 billion to the UK economy, which is the third-largest sector by size in the OECD. That is 8.6% of economic output, half of which is generated in London but half of which is generated across our regions. Of the 1.1 million jobs, 91,000 are in my region of the north-west. As the hon. Member for South Cambridgeshire pointed out, it is one of the few sectors where we have a healthy trade surplus—£46 billion in 2020. It is the fifth-largest economic sector in our economy, and all the more important for that.

As the hon. Gentleman also pointed out, the sector is important for taxation, with £28.8 billion in tax taken from it. According to PwC, it makes up £75.6 billion, or 10% of the total receipts. In the face of such change—technological, structural or the disjunction of Brexit—any Government would want to see how they could remake the environment in which the financial sector can operate and flourish to benefit and protect the sector so that it can benefit and protect our economy. We certainly all have a stake in ensuring that that is the case.

In that area of flux, we have to remember that the regulators, although they could be powerful, are struggling with an increasingly complex and fast-moving environment that they are not always geared up to deal with in detail or to keep on top of. We have seen the travails of the Financial Conduct Authority and how it manages the perimeter, and philosophically the view of caveat emptor—that the buyer should beware in all circumstances. When things go wrong, the reputation of the entire financial services sector is at stake, so it is a difficult balance.

The Financial Conduct Authority gave evidence to the Treasury Committee yesterday, some of which reflected how difficult it is to try to remake a regulator after scandals such as London Capital & Finance, at the same time as operating within all the extra complexity and uncertainty. It has a formidable task. I suspect that being chair of the FCA is one of those jobs where people are told that, if they do a stint, they will get the diplomatic equivalent of the Washington embassy as a reward. The current Governor of the Bank of England is one example of that.

The FCA needs to be strengthened. We as policy makers, and the Minister in particular, have to think about how it can practically do the job. The job cannot be so big and complex that it is undoable. Sometimes, the way that the FCA has to cope means it is difficult for it to achieve a balance and be given a job that it can sensibly do. We know there is a big turnover of staff at the FCA at the moment, and that there is workplace stress and unrest. We know that the head of the FCA is trying to transform that organisation into what he calls a lean organisation that can respond very quickly to what is going on in the market and in the areas it has to regulate. I am not convinced that it has that balance right yet, and I am not even convinced that that job can sensibly be done without more support.

I want to deal with a couple of areas that the hon. Member for South Cambridgeshire did not touch on. These are what I would call threats to the reputation of the financial services industry in this country. First, I want to talk about economic crime, which I think poses a threat to the entire sector and its integrity if it is allowed to get out of hand. We know that there are rising levels of economic crime, fraud and scams that have been turbocharged during the lockdown. The sector itself has survived covid and the lockdown pretty well so far, because it could manage remotely—it does a lot of its work remotely in the first place—but one of the things we have all seen, unfortunately, is the rise in fraud and scams. We have also seen, and perhaps it is inevitable when it is one of the biggest global centres of financial services, that London has attracted the attention of international criminals and fraudsters who wish to launder their money through cities like London. We know that, as a major financial centre, it is a target for all of these kinds of people.

The Intelligence and Security Committee, in its Russia report, which was suppressed for far too long and was finally published after the 2019 general election, said that London is considered the “laundromat” for corrupt money. We have seen that kind of magnet effect, which is extremely disturbing, and I do not think that we have yet really got a handle on it. There are regulatory failings, there are legislative failings with the structures we have to try to deal with this, and there are certainly enforcement failings of the laws that we do have.

[Sir Robert Neill]

The hon. Lady makes some very important points, particularly that last one. Does she agree that now we have left the EU and therefore, regrettably, left some of the justice co-operation measures we had, it is all the more important that we seek, bilaterally and in a broader sphere, to improve and strengthen international judicial and legal co-operation on the admissibility of evidence, rendering of suspects and, above all, dealing with digital evidence being obtained in other jurisdictions and then made available to prosecutors and the courts in the United Kingdom?

[Dame Angela Eagle]

I could not agree more with the hon. Gentleman, who is a distinguished Chair of the Select Committee on Justice. He is also a practitioner himself, so he knows about the practicalities of these issues. It is hard, in contemplating the extra work that has to be done because of Brexit, to know quite where one starts, but if we do not get it right and if we do not get on with it, this terrible reputation of London having become a laundromat for dirty money will only persist and perhaps get stronger, which will do us untold damage. I urge the Minister responding to this debate to give us some words of comfort that he is getting on with the economic crime strategy. We have an economic crime strategy—

--- Later in debate ---

[Sir Robert Neill (Bromley and Chislehurst) (Con)]

This has been a really valuable debate, and I hope that it gets as much publicity as it ought to get. I hope, too, that the sector gets as much publicity—and as much credit—as it ought to get.

The sector is massively important to my constituents in Bromley and Chislehurst, as it is in much of outer London. In my constituency, financial and professional services together account for over 36% of the workforce. The sector is by far the largest driver of jobs and of prosperity overall in our area. Of course, we must consider not just the jobs in the City or elsewhere in London, but the other jobs that the income from that work supports elsewhere in the employment chain, and the growth of other businesses in the area. The sector is critical.

It is also worth stressing, yet again, the diversity of the sector. We talked in particular about its overall contribution. As my hon. Friend the Member for Wimbledon (Stephen Hammond) said, we often think of the sector in terms of banking. Distinctions are rightly made, which I know the Minister is well seized of, between wholesale and retail, but other sectors in financial services such as insurance contribute something like £30 billion to the economy on their own. The London insurance market is massive, and has a very high reputation in both insurance itself and in reinsurance. It is vital that we include access to insurance products in any free trade deals, and keep regulation appropriate and proportionate.

London’s other great strength is the nexus of the financial services sector with other supporting professions, including the law. I declare an interest here and refer the House to my entry in the Register of Members’ Financial Interests. Legal services are themselves worth some £60 billion to the UK economy and are a net contributor to the UK’s balance of trade. So many of our financial services instruments, from derivatives right the way through to other types of contracts down to trading mechanisms, are underpinned by legal services and by the reputation of the United Kingdom as a jurisdiction of choice, because of its reliability, legal certainty and the expertise of its legal community. That is backed up by the accountancy sector, too.

As we go forward looking at free trade arrangements and regulatory deals, which I think we will have to have for the reasons that have been well set out, it is important that we do not lose sight of the fact that the whole basket comes together and contributes overall to that cluster of excellence and critical mass, which so far has given us a great competitive edge. We cannot take that for granted, and that is why some of us were troubled at the lack of reference to financial and professional services generally in the trade and co-operation agreement. We have to build on what we now have and this is a very good example of that.

Reference was made to regulatory reform. The opportunity, for example, that the insurance industry suggested for two specific reforms to solvency II would be of considerable benefit. I hope the Minister will be able to update us on progress on that. Perhaps, too, we can have an update on where we are with the actual implementation of the outcomes of the Kalifa and Hill reviews, and where we are, for example, on the movements that are freeing up and easing listing, to which I know the Government are already committed, and where we might be on variable classes of shares to encourage different types of listing on London markets.

The other point I want to make on legal services and future co-operation echoes the point made by the hon. Member for Wallasey (Dame Angela Eagle). In maintaining London’s reputation as a reliable and honest jurisdiction, it is important that we bear down on the risk of economic crime. That cannot be done in isolation. Sovereignty takes us only so far when it comes to fighting international organised crime, so it is absolutely critical that, having regrettably lost access to some of the European Union justice and policing mechanisms, we find ways to replicate them either bilaterally or perhaps through future agreements as we, I hope, develop a more constructive relationship with our European partners than is perhaps the case at the moment. It is in nobody’s interest that we have a permanent state of tension between two such significant markets on the world stage. Including legal co-operation is massively important, certainly on the justice side and stretching that out into other jurisdictions, too.

As the Minister has heard me say many times, it is regrettable that the European Union is taking a needlessly obstructive approach to the United Kingdom’s application to join the Lugano convention on the enforcement of civil judgments. It wrongly argues that it is a single market mechanism. I think the Government are right in saying that it is not a single market mechanism. It is entirely separate and this is a regrettable product of the tensions we have had. I hope the Government will not give up on that and will also look at workarounds with other, non-EU countries to maintain high levels of recognition. The enforceability of any contract, including a contract for financial services, is absolutely critical to our remaining the jurisdiction of choice.

My final point is on the contribution the City of London Corporation makes in areas such as green finance. A huge amount is being done. The City Corporation, with the Government, provided the seed funding for the first three years of the Green Finance Institute. That, of course, has been involved in building coalitions of private finance actors. The most obvious of those is the Coalition for the Energy Efficiency of Buildings. The work of the City Corporation in such areas, and in bringing forward and helping to promote and organise a bespoke platform, the Green horizons summit at COP26, shows the innovation of the financial services sector and the City as its great champion.

It was a pleasure to welcome the current Lord Mayor and the Remembrancer of the City to this place only last week at the inaugural reception of the all-party parliamentary group for London as a global city. That co-operation is as important as the way the City has sought to champion the bringing together of professional expertise. The Minister will know, and I hope will never cease to value, the work of organisations such as the Financial Markets Law Committee. It probably has more legal and financial expertise brought together in one room than we will find anywhere else in any developed economy and perhaps anywhere on the globe. Its reports are of the highest quality. It is chaired, as we know, by a former Lord Chief Justice and has a range of high-ranking professionals. I hope that the Government will continue to listen carefully to their suggestions on how to keep regulation proportionate and deal with a system that gives us good access to markets across the globe, while at the same time dealing with the necessary prudential measures from the point of view of the UK economy.

On that note, I hope we can recognise the financial services, and their allied and supporting professions, as the jewel in the crown of the British economy and emphasise that repeatedly whenever we get the chance to promote the UK abroad. We should also promote them to our own constituents and fellow citizens because they do not always get the credit that they should.

Brexit: Opportunities

Robert Neill Excerpts

Thursday 16th September 2021 Commons Chamber

[Michael Ellis]

Of course, the whole area of AI will open up myriad issues such as the one that the hon. Lady referred to. The Government are alive to those points and will take all those issues into careful consideration.

[Sir Robert Neill (Bromley and Chislehurst) (Con)]

I welcome my right hon. and learned Friend to his place and, as Chair of the Justice Committee, thank him for and pay tribute to the admirable way in which he exercised his duties as a Law Officer of the Crown, which he did impeccably. He will know from those previous posts, better than most, the level of complexity that surrounds retained EU law and that removing it will be no less complex. We need to ensure that we do so in a way that does not create legal uncertainty or disadvantage the United Kingdom financial markets, for example, in relation to ongoing, long-term contractual arrangements or financial instruments. Will he make sure that we do this with great care, perhaps working with experts such as TheCityUK and the Financial Markets Law Committee, and that we structure that in such a way that enables financial and legal services to benefit from access to new markets that we may be able to open up as a result of free trade agreements?

[Michael Ellis]

I thank my hon. Friend for his comments and for his kind remarks earlier in the House. He is right about legal—as well as financial—services, and this is an opportunity. The legal community that I and he both know in this country is a world leader. We have first-class people who support our legal prowess around the world based right here. We want to do everything we can to further build on that and he is absolutely right to emphasise the importance of that sector. It is important economically, morally and in our leadership around the world, and we will continue to work to support it.

Oral Answers to Questions

Robert Neill Excerpts

Tuesday 22nd June 2021 Commons Chamber

[John Glen]

The hon. Gentleman makes a very sensible and worthwhile point on this matter. We are looking closely at the Financial Conduct Authority’s “Financial Lives” survey, which indicates the degree of liquidity that exists. I work closely with the lenders on affordability assessments for the self-employed. I am happy to commit to continue to keep this matter under review and to receive further representations from him.

[Sir Robert Neill (Bromley and Chislehurst) (Con)]

What assessment he has made of the adequacy of the support provided to the culture and arts sector during the covid-19 outbreak.

[The Chief Secretary to the Treasury (Steve Barclay)]

In March 2021, the Chancellor announced a further £300 million to build on the existing £1.57 billion of culture recovery fund support to protect our cultural sector. To date, more than £1.2 billion in grants has been paid.

[Sir Robert Neill]

The Minister is right, of course, to point out the unprecedented sums that have been given to the arts sector, and that is very welcome, but does he recognise that, particularly for the performing arts, the further four-week delay is crippling their future plans? As all the leading producers both in the west end and throughout the country point out, it takes months to get a show going, and uncertainty cripples that planning. Will he at least consider the calls from throughout the industry for a Government-backed insurance scheme to deal with cancellations if there is further uncertainty? There is a precedent in film and TV production that could readily be adapted. This is about getting them back working, which is actually want they want, rather than simply being subject to grants all the time. They want to get back on stage.

[Steve Barclay]

My hon. Friend is right to draw attention to the success of the film insurance scheme, which has protected over 45,000 jobs and £1.6 billion of spend. On the specific issue he raises, that is exactly why my right hon Friend the Chancellor announced the additional £300 million of support at the Budget. He anticipated the fact, in going long with that support, that there would be the risk of further delays to the covid row-back, so that was part of the announcement of an additional £300 million that he set out at the Budget.

Financial Services Bill

Robert Neill Excerpts

Report stage & 3rd reading & 3rd reading: House of Commons & Report stage: House of Commons
Wednesday 13th January 2021 Commons Chamber

I hope the Minister will examine those proposals urgently, because to be frank, if the Government do not set out radical policy options on how to tackle the tsunami of debt, we can wave goodbye to a recovery, and many people across Salford will have their lives destroyed. If these proposals were good enough to bail out the banks in 2008—and they were—they are good enough to bail out the people.

[Sir Robert Neill (Bromley and Chislehurst) (Con) [V]]

There are a lot of good things in the Bill that I welcome, and I refer to my entry in the Register of Members’ Financial Interests. I welcome the assistance given to financial services in Gibraltar, and I welcome a number of the technical changes to the operation of retained European law in relation to markets. I particularly welcome new clause 6, on FinTech, which is a really important growth sector for this country. Added to the listing regime changes in the Bill, this gives us the opportunity to encourage the bringing forward of initial public offerings of FinTech companies in the UK and to build a critical mass.

I have sympathy for new clause 4, but I do not want to pre-empt the work of the Law Commission. That said, the Government do have to act more swiftly and with more urgency in relation to reform of corporate criminal liability. It has been kicking around for a long time. The Justice Committee has heard compelling evidence on the need for reform. I do not accept the contention that there is a balance on this. The balance of evidence is clearly in favour of reform. Both the current and former directors of the Serious Fraud Office have highlighted the deficiency in criminal liability in this field, as have at least two former Attorneys General. I hope that as soon as the Law Commission reports, we will move swiftly to enact this reform, because we lag behind other jurisdictions in this regard.

The other area where I do not think it is necessary to legislate is progress on equivalence. Although we may not need to legislate, it is really important that the Government address this with urgency. Of course, as we build our way forward outside the EU it will not always be appropriate to follow everything by way of regulatory equivalence, but there are many instances in which it will be very much in the interest of the City and the broader financial services sector to do so.

In the immediate term, is important that we acquire further equivalence agreements with our EU partners; that is in the interests of both sides. Currently, we have a commitment to a memorandum of understanding by the end of March, but the EU says that it has no immediate plans for further equivalence discussions. That needs to be resolved. Although it does not require legislation, we need from Ministers greater commitment to resolving the issue. There has sometimes been a feeling that financial services are being taken for granted in the Brexit negotiations; that needs to be put to bed. Financial services are the jewel in the economic crown of this country and need to be front and centre of our ongoing economic policy.

[Florence Eshalomi (Vauxhall) (Lab/Co-op) [V]]

I wish to focus my remarks on amendments 1 and 2, tabled in the name of the Leader of the Opposition. As my right hon. Friend the Member for Wolverhampton South East (Mr McFadden) said, the amendments are desperately needed now to ensure that regulators must take into account the Government’s target of achieving net zero carbon emissions by 2050. I was therefore disappointed to hear from the Minister that the Government will not support the amendments but might “consider” the matter “in the future”. We cannot afford to wait. Climate emissions are cumulative, and a large part of the carbon that we produce today will stay in the atmosphere for hundreds, if not thousands, of years.

If we are serious about tackling the climate emergency and reaching our 2050 target, we must reduce our emissions as quickly as possible. The sensible and least-destructive way to do that is to start to adapt our economy now; the irresponsible thing would be to leave it too late, thereby making the inevitable economic adjustment more painful for everyone. Regulation is one of the most powerful tools in our box of options and will ensure that the whole financial sector is unified in its actions towards this really important goal and, most crucially, acts within a timeframe that reflects the climate emergency we face.

I do not want my two young children to ask me one day why I missed the opportunity to fight for a better, more sustainable future for them. That is why I will support amendments 1 and 2, and I urge all Members in the House to join me.

Future Relationship with the EU

Robert Neill Excerpts

Thursday 10th December 2020 Commons Chamber

[Penny Mordaunt]

I thank the hon. Gentleman for the kind remarks that he makes about our negotiating team. They have done an incredible job. It is an incredibly technical job, with many details to work through, and their respective teams have done an incredible job. We owe them an immense debt of gratitude, whatever the outcome of these negotiations.

The hon. Gentleman is absolutely right: it is the job of Members of Parliament to hold the Government to account. We will always be here, whether it is on an urgent question or other matters. Again, I should plug that I am available at 10 am every day to take calls from Members of Parliament on any issue, whether it is Brexit or covid-related. But I would just say to him: please do not misinterpret the Prime Minister’s determination on sticking to these fundamental principles as somehow a negative in these negotiations. The only way we are going to get any arrangement that will enable our country to thrive is if he sticks to his guns, and he is going to stick to his guns.

[Sir Robert Neill (Bromley and Chislehurst) (Con)]

A free trade agreement is manifestly, overwhelmingly to the advantage of both sides, and it should be pressed for to the very last opportunity. However, does my right hon. Friend also recognise that security issues are critical to the welfare of this country, and so is civil justice co-operation? Those do not depend on a free trade agreement as such. The data adequacy agreement would certainly be of great advantage in sharing intelligence information. Now that the Chancellor of the Duchy of Lancaster has reached an agreement in relation to the Joint Committee and it is not necessary for us to deal with certain potentially controversial clauses in the United Kingdom Internal Market Bill, it would be greatly to the advantage of both sides if the EU Commission were to withdraw its objection to the UK joining the Lugano convention on civil justice co-operation in its own right. That would benefit both sides too, regardless of whatever else is decided.

[Penny Mordaunt]

My hon. Friend is absolutely right. There are many things that we could agree to and could do that would be beneficial to both parties. Of course, what lies behind the politics and the negotiations are decades of relationships between law enforcement and all the agencies, services and forces that work together and will continue to work together in the interests of all our citizens.