Subsidy Control Bill (Fifth sitting)

Debate between Seema Malhotra and Robin Millar

Tuesday 2nd November 2021 Public Bill Committees

[Seema Malhotra]

I thank the Minister for his comments, but I must say that I do not feel that they have so far moved us forward in tackling the very serious issues that the debate has started to uncover. I also want to refer to his consultation as an illustration of how complex this is and how it requires further considered discussion, also in the light of the risks of things going wrong. A system works well when we plan for things to go wrong. When we do that, things will largely go better, because we have managed the risks and taken them seriously. As an example, page 45 of the consultation states:

“The consultation also asked for views on whether there should be a minimum threshold of £50,000 below which no subsidies have to be reported. 14% of respondents answered this question. Of those that responded, 64% agreed there should be a minimum threshold of £50,000.”

It goes on with differing views across differing areas. That comes back not just to how the regime will be used by those who use it in good faith but to where things can go wrong. We must ensure that there are measures, boundaries and transparency in place to prevent things going wrong and to protect the public purse. Value for money surely must be a consideration—more than it seems to be for the Government from the comments that we have heard so far. This requires a much more considered debate. We need to consider some of the evidence and the risks again.

[Robin Millar (Aberconwy) (Con)]

I think that it is important that we pay attention to those matters, so I am grateful for the discussion, which I am following with interest. However, I have some familiarity with grant schemes in local authorities. One of the first questions that we, as a subsidy-awarding body, were asked was, “Has anybody else given you money?” It seems sensible for any subsidy-awarding body to ask a potential recipient of a subsidy whether they have applied for or received a subsidy elsewhere. If they fail to declare it, that is a case of fraud.

[Seema Malhotra]

I thank the hon. Gentleman for his comment. If he thinks that there should be such a requirement or that that should be in the guidance, perhaps he might raise it with his own Front Bench. It is important to have some of those checks in place. However, where fraud might be taking place, or there is an impact of—perhaps genuine—cumulative subsidies, whose responsibility is it? If an enterprise has been in receipt of multiple subsidies and does not declare them, where are they declared? If feedback to the local authority or the public authority is incomplete, how do we find out, unless subsidies are on the database and it is then much easier to search and identify them?

There is a lot more to be taken away from this discussion in terms of inefficiency and higher risk of fraud—or, if not fraud, perhaps some forms of maladministration or error. A transparent and full database would reduce the risk of many of those issues arising, and would then reduce the cost of seeking pre-action information or judicial review. Why must we clog up our tribunals with matters that could have been avoided had we had better control systems in the first place? A transparent and full database would ensure the value for money not just of the subsidy but of what the system demands and who pays for checks and balances later in the process.

The complexity of some of those issues requires us to think them through in more detail. I will not be pushing amendment 35 today, but we certainly plan to return to it in later stages of the Bill.

Subsidy Control Bill (Second sitting)

Debate between Seema Malhotra and Robin Millar

Tuesday 26th October 2021 Public Bill Committees

[Seema Malhotra]

Q Thank you very much for those answers. As you will be aware, concerns have been raised that the role, voice and powers of the devolved Administrations within the regime may not be strong enough, particularly for a four-nations approach. It has been suggested that that should be addressed and the Bill strengthened. Are there specific areas that you would say need to be strengthened?

Ivan McKee: A four-nations approach clearly has to take recognition of areas of devolved responsibility, be that for agriculture, forestry, fisheries, environment, economic development and so on. A range of areas on which the Bill impinges are devolved under the settlement. So clearly that is a concern.

I suppose another concern about the Bill’s general operation is the lack of the option, or requirement, under the EU regime for pre-notification or advance approval. In advance of an award or a subsidy being made, that gave certainty that it was aligned with the rules in place. The absence of that in this Bill creates a great deal of uncertainty as to what is allowable and what is not in advance of any subsidy decisions being made.

[Robin Millar (Aberconwy) (Con)]

Q It is a pleasure to be here with you in the Chair, Ms Nokes.

Welcome to this Committee of the UK Government, Mr McKee. We are discussing a UK Government instrument and within that there are provisions made for the role of the devolved Administrations. Clause 10 gives the devolved Administrations scope to set their own scheme of subsidies. Is that your understanding? Do you feel that that provides the Scottish Government with the powers to do what they need to do?

Ivan McKee: No, because the Secretary of State has powers over devolved areas that Scottish Government Ministers do not have, and that impinges on the devolution settlement. That settlement is quite clear on areas that are reserved and devolved, and it is the Scottish Government and Scottish Ministers who have the power to act and operate in those devolved areas. The Bill gives those powers to the Secretary of State and the UK Government, but it does not give equivalent powers to Scottish Government Ministers to operate likewise in devolved areas.