Oral Answers to Questions

Toby Perkins Excerpts

Tuesday 20th November 2018 Commons Chamber

[Mr Speaker]

Last question in this section, very briefly. I call Toby Perkins.

[Toby Perkins (Chesterfield) (Lab)]

13. What estimate he has made of the number of pubs that closed in 2018; and what assessment he has made of the reasons for those pub closures.

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

Pubs make a major contribution to the economy and to community life. That is why the Government are supporting pubs through measures such as the beer duty freeze and the business rates retail discount announced in the Budget.

[Toby Perkins]

That does not really answer the question of why 7,000 pubs have closed since 2010, so I encourage the Minister to address that when she returns to the Dispatch Box. To be more positive, she will have seen that the all-party parliamentary group on pubs is bringing about a parliamentary pub of the year award, so I encourage her to nominate a pub in her constituency and to join us and the Under-Secretary of State for Housing, Communities and Local Government, the hon. Member for Rossendale and Darwen (Jake Berry), on 15 January to find out which is Britain’s greatest parliamentary pub.

[Kelly Tolhurst]

I recognise the hon. Gentleman’s concern and his work in this area over a long period of time. He is a champion for the sector. There are several reasons why there may be pub closures, which is why we are acting to freeze beer duty and address small business rate relief. We estimate that 75% of pubs will benefit from the reductions announced in the Budget. To answer his second point, I will happily attend the event on 15 January, if possible.

Oral Answers to Questions

Toby Perkins Excerpts

Tuesday 17th July 2018 Commons Chamber

[Greg Clark]

My hon. Friend knows that I am a great champion of devolution and decentralisation, and he makes an intriguing suggestion, which I would be very happy to take up in discussions with him.

[Toby Perkins (Chesterfield) (Lab)]

Many small care agencies face bankruptcy in the light of the Treasury advice on the way in which sleep-ins are paid, which has now been changed by the courts. The Minister for Energy and Clean Growth, the right hon. Member for Devizes (Claire Perry), did not seem to know too much about this, but may I urge her to avail herself of the facts urgently, because many small agencies will go bust if we do not get this right?

[Claire Perry]

I want to reassure the hon. Gentleman; he is absolutely right. I have had strong representations and visits about this issue in my own constituency. My reluctance to comment on it at the Dispatch Box is because it is legally incredibly complicated, as he knows, and we have just had the freshest possible news about the judgment. We need to take that away, and we will comment on it shortly. I would be very happy to work closely with him on this issue.

Oral Answers to Questions

Toby Perkins Excerpts

Tuesday 12th June 2018 Commons Chamber

[Andrew Griffiths]

As my hon. Friend will know, in April 2017, retailers saw a 6% reduction before inflation in their business rates, with £3.6 billion of transitional relief. We are doing what we can to support businesses. The Retail Sector Council will be looking at a range of issues, including business rates. The Government are determined to ensure that the taxation system is up to date and fit for purpose.

[Toby Perkins (Chesterfield) (Lab)]

One of the areas on the high street that is particularly struggling is that of our important pubs. I would be interested to hear the Minister’s view on the extent to which pub-owning businesses and tenants enjoy confidence in the Pubs Code Adjudicator—and if they do not, what steps the Government are taking to put that right.

[Andrew Griffiths]

As the hon. Gentleman will know, I take a particular interest in the health of public houses up and down the country. He will know that this Government set up the Pubs Code Adjudicator to ensure that landlords and tenants across the country got a fair deal. It is still early days, but the adjudicator is getting on and making decisions. I know that the Under-Secretary of State for Business, Energy and Industrial Strategy, my hon. Friend the Member for Watford (Richard Harrington), is in close discussions with the adjudicator to ensure that he is getting the job done.

Oral Answers to Questions

Toby Perkins Excerpts

Tuesday 1st May 2018 Commons Chamber

[Mr Gyimah]

I completely agree with my hon. Friend. We recognise the excellent contribution that Scotland’s Rural College and Harbro have made to developing agri-tech through partnering with the centres for agricultural innovation, where they are aiding the adoption of data-driven products. As I have said, we are investing £90 million in the transforming food production challenge, which will really help the UK to capture significant global challenge.

[Toby Perkins (Chesterfield) (Lab)]

The agri-tech sector has tremendous potential in this country, but if we are to get all the manufacturing jobs out of it, as well as the innovation, we need to do something about the most expensive corporate property tax in the entire EU. Will the Minister tell us whether the Government are still sticking to their manifesto commitment to have a wholesale review of the business rates system, so we can have a competitive system for the agri-tech sector?

[Mr Gyimah]

The hon. Gentleman will be aware that, in the Budget, the Chancellor announced that he will be bringing forward proposals on that manifesto commitment in due course.

Office for Students

Toby Perkins Excerpts

Tuesday 27th February 2018 Commons Chamber

[Mr Gyimah]

If the Government were interested in politicising the process in our favour, we would not have a former Labour parliamentary candidate as the chair of the Office for Students—he has advised Labour Prime Ministers and Conservative Ministers. All the candidates had to declare their political affiliation, which was subsequently published.

In the case of Ruth Carlson, for example, there are no discernible political views, but she is very well qualified. She is a student ambassador at the University of Surrey. She was also her second-year course representative and a member of the scholarship committee. When we think of these representatives, we should not always default to the lobby organisations or to people we think fit the bill; we should cast the net wider to bring in the widest possible experience and fresh thinking.

[Toby Perkins (Chesterfield) (Lab)]

The Minister has the audacity to talk about casting the net wider when another old Etonian mate of his friends has been appointed through a process that was utterly corrupt. The report says that the key question is whether each candidate was treated fairly and impartially; the answer here is no.

The Government are in absolute disarray, and the Minister is making the situation worse. He says that he is willing to learn lessons. Will he at least confront the fact that this process is not fit for a modern nation like ours?

[Mr Gyimah]

I stopped listening when the hon. Gentleman said that Toby Young is an old Etonian—I do not believe he ever was.

Points of Order

Toby Perkins Excerpts

Tuesday 27th February 2018 Commons Chamber

[Robert Halfon (Harlow) (Con)]

rose—

[Toby Perkins (Chesterfield) (Lab)]

rose—

[Mr Speaker]

I will come to the hon. Member for Chesterfield (Toby Perkins)—we will save him for now. He can cook for a little longer.

--- Later in debate ---

[Mr Speaker]

I think I ought to take the hon. Member for Chesterfield first, so the hon. Member for Cardiff West (Kevin Brennan) can wait.

[Toby Perkins]

On a point of order, Mr Speaker. In my question, I described Toby Young as an old Etonian. I am sure he has been called worse, and I could have used many other phrases, but apparently he was not educated there and so that should not be added to his charge sheet. Will you therefore allow me the opportunity to correct the record?

[Mr Speaker]

Yes, the hon. Gentleman has corrected the record, and I am grateful to him for his courtesy in doing so.

Pubs Code 2016

Toby Perkins Excerpts

Wednesday 24th January 2018 Westminster Hall

[Mr Bailey]

Again, my hon. Friend makes an important point. The more we drill into this subject, the more comes out of it. Unfortunately, I am too constrained by time to go into every single issue that arises.

[Toby Perkins (Chesterfield) (Lab)]

I am keen to intervene before my hon. Friend moves on from that point. As I understand it, in the four cases in which the Chartered Institute of Arbitrators found that there was a conflict of interest, Mr Newby has continued to arbitrate. He has not accepted the verdict of the Chartered Institute of Arbitrators. An important question for the Minister is whether he thinks that if the Chartered Institute of Arbitrators believes that there is a conflict of interest, Mr Newby should respect that verdict.

[Mr Bailey]

My hon. Friend raises another significant point. By continuing to act on the case, Mr Newby is acting in breach of the code of conduct of the professional institute of which he is a member.

It is also significant that successful negotiations between the pub companies and tenants were rare. Eight times as many cases were referred to the PCA for arbitration, and four times as many went to independent agreement, as decided by bilateral negotiations between the tenants and the pub companies. It is not difficult to understand why. There is now overwhelming evidence that the pub companies’ historic antagonism, intimidation and bullying has continued, and the confrontational culture has prevailed, deterring tenants from taking, seeking or achieving market rent only options as a result of bilateral negotiations with the pub companies.

That is confirmed by the market rent only verification exercise of August 2017. The report states:

“Almost without exception, tenants and tenant advisers reported that while the POBs are abiding by the letter of the Pubs Code, to varying degrees they are not acting within the spirit of the Code; and that some are taking a legalistic approach to the Code.”

The second highest number of calls to the Pubs Code Adjudicator inquiry line related to the behaviour of pub companies, and they included accusations of intimidation, bullying and delay tactics. Those are not my words, but the words of the report.

I do not have time to examine every device used by the pub companies to frustrate negotiations but will pick out just a few. First, they include processes in their negotiations with tenants that are designed to push up costs, and include conditions not commonly found in tied tenancies or pre and non-code free-of-tie agreements.

Secondly, there is insistence by the pub companies for a brand new tenancy agreement, rather than a deed of variation to an existing tied tenancy. That enables pub companies to introduce new terms and requirements not historically found in a free-of-tie agreement, but that introduce substantial additional upfront costs.

Thirdly, deposits and advance rents are designed to make the market rent only option unaffordable. Lastly, there are unreasonable, unexpected and novel improvements of dilapidation requirements, including things such as a new roof, new pumps, resurfacing of car parks, cellar cladding, fire rules assessments and, I believe, patios as well. I would stress that those are only some of the strategies used by the pub companies to circumvent the spirit of the law.

Arising from a letter from my hon. Friend the Member for Leeds West (Rachel Reeves), the Chair of the Business, Energy and Industrial Strategy Committee, on 3 November 2017, the Pubs Code Adjudicator acknowledged

“that very few MRO notices served by tied pub tenants convert into MRO tenancies, and that bilateral negotiation and agreement between pub-owning businesses and tied pub tenants appear to be by exception.”

That is a formal confirmation from the Pubs Code Adjudicator that, in effect, it is not working. It is clear from the verification exercise that the pub companies are using their legal expertise and superior bargaining power to perpetuate the status quo and to thwart the intended objectives of the pubs code legislation.

In the same letter, the Pubs Code Adjudicator says that he is prepared to use his enforcement powers to ensure compliance if necessary. We have been operating with the code for 18 months, and there is overwhelming evidence that it is necessary and reasonable to ask why—given the evidence that has emerged in that period —he has not done it already. Instead, the adjudicator has published a compliance code for pub companies which, frankly, we would have expected to have been produced much earlier. Predictably, the pub companies have reacted with an antagonistic letter to him. I am afraid that, on the basis of earlier precedent, it is only the threat of legal action that will move the companies.

In the same letter, the adjudicator says that he will make recommendations to Ministers about business practices that he believes are unfair to tied pub tenants but are not breaches of the pubs code. Again, the evidence about that has been there for a long time, so why has he not done that before? I ask the Minister this question: if the recommendations from the adjudicator are forthcoming, or indeed even if they are not, will he make the appropriate changes to the legislation to ensure that it meets its objectives?

In his letter to my hon. Friend the Member for Leeds West, the Pubs Code Adjudicator asserts that his aim is to help to reshape the culture of the industry. To date, there has been absolutely no sign of that. The pub companies are intransigent and have enormous resources at their disposal. To change the prevailing culture, a much tougher approach is needed. The PCA is running out of time and it is time that the Government sought a replacement.

The Government need to make a couple of headline adjustments to the legislation or the code to ensure that the code is effective and the problems that I have outlined are overcome. Many such changes would do that, but there are two key ones. The first is to ensure that the definition of the market rent only option makes clear the right of a tenant to pay an independently assessed market rent, and only that rent, to the pub company. Secondly, the only changes to deeds of variation that should be allowed are the severing of tied terms and the rent being an independently assessed market rent. Those two alterations would go an enormous way to addressing some of the important grievances that have emerged so far, but many others could be made.

I will conclude by saying that, as I said earlier, I have been involved with this for a very long time—many Members from all parties in the House have been equally committed. I pay tribute to my predecessors as the Chair of the Business, Innovation and Skills Committee and its predecessor Committees, and the many campaigners in the many voluntary groups who have been so assiduous and dedicated to ensuring that we drag these companies kicking and screaming, by whatever legislation is necessary, to confront their responsibilities as operators of important community facilities that play an absolutely vital role in so many people’s lives, and in the lives of so many communities. I will not rest until that is done and I hope that other Members and the Government will work with me to ensure that we achieve that goal.

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[Toby Perkins (Chesterfield) (Lab)]

It is a pleasure, as always, to serve under your chairmanship, Mr Robertson. I congratulate my hon. Friend the Member for West Bromwich West (Mr Bailey), who has been an incredibly important contributor to us getting as far as we have towards justice for pub tenants and a fully functioning, fair market in our pubs industry. My hon. Friend made his case in a typically impressive fashion and laid out many of the issues that face all those who want the pubs code to work in the way that Parliament originally intended.

I do not propose to repeat all the history that my hon. Friend laid out, but it is important to remember that Parliament, and subsequently the Government, took the fairly unprecedented step of intervening in a market—and despite the rhetoric, that has not been the Government’s modus operandi over the last few years—because of historic market failure. There was recognition that pub companies had failed to get their house in order, despite numerous opportunities to do so, and that there was an unfair imbalance in the relationship between powerful pub companies and tenants, who were individual small business people.

For that reason, hon. Members in all parts of the House voted to support the introduction of a market rent only option in the pubs code as part of the Small Business, Enterprise and Employment Act 2015. The support of Conservative and Liberal Democrat Members meant that the Government were defeated, and the market rent only option was put in. It is important for us all that that works, and that we deliver on the principles intended by the 2010 to 2015 Parliament.

I would like the Minister to clarify that he is responsible for the pubs code. I was under the impression that the Under-Secretary of State for Business, Energy and Industrial Strategy, the hon. Member for Burton (Andrew Griffiths), had taken over the role.

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

I confirm that I have that portfolio. That has happened only in the last few days, but I am and will be responsible for pubs. I am listening eagerly to what the hon. Gentleman and other hon. Members are saying.

[Toby Perkins]

I thank the Minister. If that was not press released, he has just released it. I congratulate him on that important role. He may well know the history, but others may not.

One of the founding principles of the pubs code’s introduction, as laid out by the right hon. Member for Twickenham (Sir Vince Cable) when he was Secretary of State for Business, Innovation and Skills, was that there should be a rebalancing of the level of reward between pub companies and tenants. The Government’s intention was specifically that tenants should be better off as a result of the pubs code’s introduction.

My hon. Friend the Member for West Bromwich West referred to two key principles: that the market rent only option should be on a fair and reasonable basis, and that tenants who were tied should not be worse off than those who were free-of-tie. I will come back to that point.

Perverse and bizarre as it may sound, the introduction of the pubs code was simultaneously late to arrive and rushed. It had a short period of implementation and took a long time after the legislation was passed to be delivered. As a result, sufficient preparation was not done by Government, or by some companies, to get ready for its introduction.

The appointment of the Pubs Code Adjudicator was surrounded by controversy. My hon. Friend referenced the inordinate delays and some of the methods used to prevent landlords fulfilling their rights to go market rent only. It is important to remember that many tenants are in a perilous financial position when they seek to go free-of-tie. They are not in a position where inordinate delays, very substantial outlays of cash or huge legal costs are attainable.

If we want to deliver the opportunity—the right—for the tenant to assess an independent market rent and decide whether they want to have a landlord-tenant relationship, or whether they want to receive all the services from a pub company, it is important that the delays are not inordinate and that false additional charges are not put in to prevent them from being able to take up that right. That is one of the strategies that seem to be being used very deliberately.

Most tenants have a five-year contract period. If they come to the end of a contract and attempt to get a free-of-tie rent assessment, the clock is ticking on their next five-year contract. That delay is being put in there, but if they subsequently go free-of-tie or get an arbitration or adjudication award in their favour, there is no opportunity to backdate that to the start of their five years—all the more reason why the principle should be that the adjudicator carries out their role in the most timely fashion possible. Any tenant who manages to get an independent assessment and decides to take that up does not get that rent backdated. The code should be amended so that rent is backdated to the point of application. I ask the adjudicator to adjudicate on that and the Minister to clarify that in his remarks.

For many tenants, there is a narrow window in which they can take up the right to get an independent assessment. At the end of their contract, they have to let their pub company know. They are often waiting for a new assessment and under the impression that they are still part of a negotiation by the time that they realise that they have missed out on their opportunity to take advantage of it.

My hon. Friend referred to the conflict of interest that many people feel Mr Newby had when he took on this role. There are two important elements of that for tenants’ confidence in the process. We should be clear that many tenants would like the opportunity to take up their right, but have lost confidence in the process. They believe that if they try to take up that right, they will only take on additional cost, so they are not taking advantage of this. I am sure that that disturbs all hon. Members who wanted the legislation to be introduced.

There is a financial conflict. Mr Newby continues to hold shares and to be owed money by Fleurets, which has many leading pub companies as its customers. Whatever the questions about his history, it is absolutely wrong that he did not divest himself of that interest when he took on this role. We are talking about a relatively small sum—although significant for an individual —so given the importance of the industry and the legislation, it would have been far better for him to have divested himself of that.

The point about the Chartered Institute of Arbitrators ruling against the PCA’s arbitrating on four different cases is significant. The Chartered Institute of Arbitrators’ spokesman said that when a challenge was upheld, an arbitrator’s appointment in that dispute is “immediately terminated”, and they should not be involved in that case again. In response to that, a spokesperson on behalf of the Pubs Code Adjudicator said that because his responsibilities were established by an Act of Parliament, the PCA did

“not accept that the Chartered Institute of Arbitrators has any jurisdiction to appoint or remove an individual from the role of arbitrator in a pubs code arbitration.”

That is an important matter of law for the Government, and also a matter of direction.

I believe that as a matter of law, the PCA should have listened to the Chartered Institute of Arbitrators. Even if it is true that the institute does not have the power to remove him, a sensible arbitrator would say, “Given that an independent body says that I have a conflict of interest, it surely makes sense for me to stand down and appoint a truly independent arbitrator.” The question of the extent to which the Pubs Code Adjudicator is both an adjudicator and an arbitrator is significant, because arbitrations happen in private and adjudications happen in public.

What we have seen from the Pubs Code Adjudicator so far is that he is much more of an arbitrator than an adjudicator. Might the Government consider separating those roles? The role I envisage for the PCA as a spokesman for the code is undermined by the fact that so much of his dealings are done in private, so he has not taken on nearly enough of a forceful role, which is what I would like him to play. If he criticises some of the pub companies, as he does, that perhaps makes it more difficult for him to arbitrate in private with them, so there are real difficulties in all of that.

My hon. Friend the Member for West Bromwich West referred to the section 40 powers of the Small Business, Enterprise and Employment Act 2015, which impose a duty on the Pubs Code Adjudicator to notify the Secretary of State if he believes the code is being breached and not followed. It is clear from his public pronouncements that he believes the code is being breached, but I am under the impression that there has never been a section 40 notice given to the Secretary of State. If that is the case, will the Minister or the Secretary of State pursue that with the Pubs Code Adjudicator? If he is publicly saying that there is wrongdoing, why has he not written to the Secretary of State with suggestions about altering the code to clarify and strengthen his case, or made the report that he has a duty to make?

There are two or three key questions in the pubs code that it is important to clarify. One of them concerns market rent only. The right to market rent only is laid out in the Act, and that should not need any arbitration. It is a fact that if someone reaches one of the trigger points, they are entitled to ask for a market rent only option. The pub company has a right to make an offer, but if the tenant believes the offer is not fair, they have the right to go to an independent arbitrator. For some reason, the Pubs Code Adjudicator considers all the different applications to be arbitrations, but an independent assessment should not be a matter of arbitration. That is absolutely the principle of the clause in the Bill that we all approved.

On the market rent only option, the fact that someone would pay rent for the pub and not be tied on the drinks that are sold is absolutely accepted by the tenants and the pub companies. The question then arises: which of the other terms in the contract should also be a part of the contract? The pub companies would say a market rent only option means market rent only, and that is the basis of the entire relationship, whereas the tenants say that anything that is common in the industry that was part of the original contract should be part of the subsequent contract. Will the Minister clarify that?

Finally, to be positive, the appointment of the Deputy Pubs Code Adjudicator is welcome. We have seen a real difference since she was appointed. I would like to see her take an ever greater role. Some tenants are getting a better tied deal as a result of the threat of going free of tie. However, the question of deeds of variation is important. Will the Minister set out his view on that?

In conclusion, how many times, if at all, has the Pubs Code Adjudicator written to the Secretary of State to report failure to adhere to the spirit of the code? What is the Government’s view on whether terms that were in a previous tied contract should remain in free-of-tie contracts? Do the Government agree that Mr Newby should accept the verdict of the Chartered Institute of Arbitrators, and do they believe that the Chartered Institute of Arbitrators has a right to a view on those questions? It is important. The pubs code is a vital opportunity for the industry. It is important that we all make it work.

--- Later in debate ---

[Jim Shannon (Strangford) (DUP)]

I congratulate the hon. Member for West Bromwich West (Mr Bailey) on bringing the matter forward today. The hon. Member for Berwickshire, Roxburgh and Selkirk (John Lamont) said that it does not directly affect his constituency, and neither does it directly affect Northern Ireland, but that does not lessen our interest in the issue. I have spoken on it, and asked questions about it, before. I want to speak about the principle of the matter, although it is only England and Wales that are affected.

I have long held the view that we need to consider who audits the auditors and who holds to account those who hold the rest of us to account. I have been dismayed at times, when, trying to represent my constituents, I have requested information from accountability bodies. It would appear that the matter before us presents another example of the need for more accountability, as the hon. Member for West Bromwich West suggested.

I want to give credit to someone who is no longer in this House, and whom the hon. Member for West Bromwich West will well recall—Greg Mulholland, who represented Leeds North West. He fought the case in the Chamber whenever he had the opportunity. I was betwixt the two—the hon. Member for West Bromwich West, who sat behind me, and Greg Mulholland in front of me.

[Toby Perkins]

I am grateful to the hon. Gentleman for saying that. I wrote down the same point in my speech but failed to read it out, so I am grateful that he took the opportunity. He is right to say that Greg Mulholland was a principal actor in getting the measure into the draft.

[Jim Shannon]

I thank the hon. Gentleman for that intervention.

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

It is a pleasure to serve under your chairmanship, Mr Robertson. I congratulate the hon. Member for West Bromwich West (Mr Bailey) on bringing to the Chamber an important debate that affects many people’s lives.

Having managed bars during my career, I want to say a few words for the people who work in pubs and the hospitality industry. It can be a difficult and demanding job, but also very rewarding. All those people put in a shift and a half on many occasions, and do us proud, regardless of which nation of the UK they work in.

The hon. Member for West Bromwich West talked about difficulties with the adjudicator in England and Wales. He went into welcome detail about the challenges for operators—unfair expenses and difficulties in getting market rent. There were many things for the Minister to respond to. The impartiality of the operation is also an important factor to take on. The hon. Gentleman mentioned the onerous conditions placed on publicans, which I think will ring true for people who have been in such a difficult position.

The hon. Member for Chesterfield (Toby Perkins) said that the imbalance between powerful pub companies and people who are trying to run pubs is an historic market failure, which it is.

[Toby Perkins]

Obviously, we have introduced the code of practice—the hon. Gentleman has heard about some of the issues with its implementation, which hopefully Scotland can learn from. He will be aware that in the 2010 to 2015 Parliament, Scottish National party MPs voted for that code, because even though it was England-only legislation, they hoped that a similar provision might be introduced in Scotland. Will the SNP support the private Member’s Bill when it reaches the Scottish Parliament?

[Drew Hendry]

I intend to cover that point, and will answer it fully in a moment or two.

I congratulate the new Minister for pubs on his remit. If he listens today and is able to make the required changes, I am sure many people will raise a glass to toast his appointment. It is pleasing to be able to agree for a change with the hon. Member for Berwickshire, Roxburgh and Selkirk (John Lamont). It is a rare occurrence. He mentioned a private Member’s Bill in Scotland—I will return to that—and rightly said that the pub landscape in Scotland is different from that in England and Wales. He mentioned the importance of pubs in the community, and again I agree. In areas where pubs are successful, they make a vibrant offering to the economy. He also mentioned Burns. As he will be aware

“gude ale comes and gude ale goes”—

wise words indeed. The hon. Member for Strangford (Jim Shannon) made an important point about who audits the auditors, which the Minister should address. He also made a point about community.

On the private Member’s Bill, there is cross-party support in Scotland for looking into a statutory code, and to back that up the Scottish Government commissioned a study to look at various pub models. Work on that is ongoing, but it is looking at whether pubs in the tied sector are more unfairly treated than those in other sectors. The conclusion of the initial investigation was that, as I said earlier, it is difficult to compare the market in England and Wales with that in Scotland, because they are so different due to Scotland’s independent free trade model. The Scottish Government are currently looking into whether such legislation is required, and I understand that discussions have been continuing right up to the minute about how to take that forward.

Since the Minister for pubs is here, I wish to underline that pubs need support. In Scotland, the SNP Government are working closely with public bodies and the industry to support jobs, infrastructure and the hospitality sector. Interestingly, the introduction of minimum unit pricing, which targets very cheap alcohol, could help the pub economy in Scotland because it will prevent people from buying cheap drinks in supermarkets, and allow them to spend more time in the controlled environment of a pub. The alcohol minimum pricing is set at 50p a unit. The chief executive officer of the Scottish Licensed Trade Association, Paul Waterson, has said:

“Cheap priced alcohol has turned Scotland into a nation of stay-at-home drinkers. Some 72% of total alcohol sales in Scotland are off-sales; 80% of this total, is sold by supermarkets. When people drink in uncontrolled environments, alcohol-related problems increase significantly.”

The brewing and pub industry in my constituency has had considerable success. Cairngorm brewery is nearby, as is the Black Isle brewery. The oldest bar in Inverness is Gellions, which was formed in 1841, and the Best Bar None awards have just declared through their best bar scheme that 22 venues in Inverness have won awards for outstanding efforts in helping to create a safer environment for the public. Will the Minister look into the small business bonus that has operated successfully in Scotland? Two out of five pubs now pay zero or reduced rates thanks to that bonus, which helps their viability.

Office for Students: Appointment

Toby Perkins Excerpts

Monday 8th January 2018 Commons Chamber

[Toby Perkins (Chesterfield) (Lab)]

The Minister has really diminished himself over the course of the past 45 minutes, and Toby Young is really not worth ruining his own career for. Mr Young is someone who has contempt for women, contempt for disabled people, and contempt for people from deprived communities who have the effrontery to try to get into Oxford. Will the Minister do the decent thing and disown Mr Young, and see his own reputation much enhanced for doing so?

[Joseph Johnson]

We are going over much the same ground as in previous questions. The tweets, remarks and comments that Mr Young has made were clearly wrong. He is absolutely right to have apologised for them. Since making many of those remarks, he has continued to do good work in our educational system: he is delivering good outcomes for disadvantaged pupils at his schools in west London; and he is working hard on the Fulbright Commission. We have every expectation that he will make a valuable contribution to the work of the Office for Students.

Draft Small Business Commissioner (Scope and Scheme) regulations 2017

Toby Perkins Excerpts

Tuesday 21st November 2017 General Committees

[Margot James]

I thank my hon. Friend for that observation; he has considerable experience in these matters, and I would not be a bit surprised if what he says were the case. I will ask the commissioner to consider that practice and other known dodges—for want of a better word—in the course of his work.

The 2016 Act sets out the broad framework for the Small Business Commissioner. The regulations define “small business” for the purpose of qualification for the commissioner’s services, including the complaints scheme; they also provide further detail about the scheme.

[Toby Perkins (Chesterfield) (Lab)]

Further to the point made by the hon. Member for Hertford and Stortford, a major issue faced by small businesses is that if they challenge late payments, their customers may simply cease trading with them. Small businesses therefore have to decide between waiting 90 or 120 days to be paid or getting no business at all. Changing the culture so that businesses can make complaints without customers knowing who they are will be crucial to solving this problem, which we have wrestled with for many years.

[Margot James]

I agree that confidentiality is often a requirement and that the lack thereof is a disincentive for small businesses to challenge the late payment practices that have been a part of business culture. There is provision for the commissioner to respect the confidentiality of complainants and, indeed, it is his duty to do so unless the complainant gives permission for his or her name, or the company name, to be disclosed. We can discuss that further later in the debate because it is important. I am well aware that in a system that provides for confidentiality, there are occasions when it is impossible to conceal the true identity of the complainant company in reality. The hon. Gentleman raises a difficult issue.

The regulations set out: that a business must have a headcount of fewer than 50 staff on one of the assessment dates or during one of the assessment periods to qualify to use the commissioner’s services; the requirements that must be met before presenting a complaint; the requirements for the form and content of the complaint; the time limit for presenting a complaint; the power for the commissioner to fix and extend time limits and to dismiss complaints; the matters that the commissioner must take into consideration when determining whether an act or omission complained about was fair and reasonable; and factors to be taken into account when deciding whether to identify a respondent in any report of any complaint. They apply to the whole of the United Kingdom.

We consulted between 13 October and 7 December 2016 on how the Small Business Commissioner would handle complaints. We published draft regulations in February and interested parties were invited to comment on them between 24 February and 9 March. The key message from respondents to that consultation was that the regulations should be simple so that the Small Business Commissioner’s services would be as efficient and effective as possible. The regulations will enable the Small Business Commissioner to accept complaints on payment matters from small business suppliers about their larger clients. That is an important part of the Small Business Commissioner’s role in supporting small businesses.

Although the debate is limited to the regulations, I take the opportunity to welcome Mr Paul Uppal to his post as the UK’s first Small Business Commissioner. He competed against many other well-qualified candidates to secure the role. I thank all those who applied for the role and who engaged with the consultations and policy development inside and outside the House.

Smart Meters Bill

Toby Perkins Excerpts

2nd reading: House of Commons & Money resolution: House of Commons & Programme motion: House of Commons & Ways and Means resolution: House of Commons
Tuesday 24th October 2017 Commons Chamber

[Rebecca Long Bailey]

My hon. Friend makes a fantastic point. Perhaps the Minister can confirm how the Government plan to expand public awareness about this. Beyond the availability and the benefits of smart meters, it is imperative to explain the benefits of the data they collect, as well as how consumers can access and use those data to bring their energy bills down.

We have already heard comments about data. I draw to the Minister’s attention the fact that Smart Consumer Alliance has highlighted to me that its research shows that

“several consumers in the UK have contacted their energy suppliers to securely interface to the data provided by the home area network functionality of their smart meter, but…in all cases this has been unsuccessful because energy suppliers often block connection to the meters, quoting technical difficulties and other issues”.

Those consumer requests were professionally assisted by academics and technology innovators in the UK with devices that are certified under the UK smart metering standard. As the Minister and the Secretary of State are aware, this data is very useful for research, enabling market competition through accurate tariff and supplier switching, intelligent heating systems, and consumer education and guidance in energy efficiency, as well as many future innovations in home energy management. However, despite the fact that consumers are struggling to access their own data, it is thought that these devices are being routinely used by the energy companies for their own data collection purposes.

On the design of the smart metering regulation and standards, as well as the justification for the cost of smart meters, the House is aware that consumer benefit was at the fore in discussions before implementing the roll-out. Indeed, at condition 49.4 of the energy supplier licence, there is the obligation to support, free of charge, requests for data. The amount of data collected by smart meters is enormous, and has a significant value for customers and those with whom they choose to share the data. It would therefore be encouraging to hear from the Minster what plans he has, in the light of the concerns I have raised, to ensure that consumers have unimpeded access to the data to which they are entitled.

I turn now to the second part of the Bill, on the special administration regime. Given the centrality of the DCC to the successful working of the smart meter system, it is clear that we need a plan in the event of its insolvency. I am therefore concerned by clause 7. As the explanatory notes summarise, the clause includes provision

“requiring the holder of the licence to raise the charges imposed on its customers or users so as to raise such amounts as may be determined by the Secretary of State and to pay the amounts raised to specified persons for the purpose of making good a shortfall in the property of a smart meter communication licensee available to meet the expenses of smart meter communication licensee administration.”

They go on to state:

“This will allow the costs of smart meter communication licensee administration to be recouped via the licence mechanism from the industry.”

The DCC is a wholly owned subsidiary of Capita plc, to which the task of providing all the communications and infrastructure for the operation of smart meters has been outsourced. However, it is not clear from the Bill or the explanatory notes why, in the event of this wholly owned subsidiary of Capita going into administration, customers and users, per se, should foot the bill, especially when they have already suffered the cost of the smart meter roll-out in their energy bills.

The Select Committee on Science and Technology estimated that the total consumer benefits of smart meters amount to more than £5 billion from energy saving and microgeneration. However, the benefits for suppliers, which include the big six energy companies and others, total £8 billion. Despite that, as my hon. Friend the Member for Southampton, Test (Dr Whitehead) has said to the Government, customers are estimated to pay somewhere between £130 and £200 on their bills to enable suppliers to recover the installation cost of a smart meter. In fact, when two of the big six energy companies announced price rises in February, they stated that a substantial element of the 10% increase resulted from the smart meter policy. The Government responded that they would monitor the extent to which costs were passed on to customers and intervene to make sure that customers saw the benefits.

When he sums up, will the Minister confirm what recent assessment he has made of the costs that consumers face for smart meter installation? Can he still provide evidence of a clear long-term average energy bill saving for smart meter consumers, despite the sum for installation cost recovery? What assessment has the Minister made of the possible costs involved in making good any shortfall in the property of a smart meter communication licensee that is available to meet the expenses of such a licencee’s administration? I appreciate that that is a hypothetical question and the answer is difficult to quantify, but if he has not assessed that or attempted to do so, will he confirm whether he has considered setting a limit on the cost that can be passed on to consumers? What safeguards will he put in place to protect consumers against an unfair increase in their energy bills as a result of administration expenses? Why do the costs seem to be borne by customers or users alone? Has he considered levying the recovery of such costs on any other entities that might benefit from smart meter data collection? If not, what is his rationale for not looking at those other entities?

The Minister will no doubt realise that there is invariably a risk that consumers who have smart meters installed could face an increase, rather than a reduction, in their energy bills. It would be helpful if he could provide clear assurances on that matter. Although an insolvency situation is extremely unlikely, if smart meter consumers have hanging over them the possibility that they will have to write a blank cheque for administration costs, many people will be deterred from participating in a smart roll-out.

[Toby Perkins (Chesterfield) (Lab)]

I congratulate my hon. Friend on her support for the Bill and the points that she has raised. A concern that has been raised with me is that a huge number of old-style meters are ending up in landfill. There is no need for that, because they still have value in many export markets. An enterprising company in my constituency, Meter Provida, has taken on the role of getting the old-style meters checked out and sold as exports. May I encourage my hon. Friend to put pressure on the Government during the passage of the Bill to consider enforcing compliance with the waste electrical and electronic equipment directives by companies that have old-style meters to ensure that more of them are reused?

[Rebecca Long Bailey]

My hon. Friend makes a valid point, and that is certainly something that the Opposition will take forward. It would be interesting if the Minister elaborated on the Secretary of State’s comments about the updating of SMETS 1. What will it entail, and when will it occur?

The Opposition have been clear about our concern that customers are paying for the roll-out. I fear that without adequate safeguards in the Bill, consumers may end up footing the bill for any mismanagement of the data collection regime resulting from insolvency. If that is the case, the Minister must understand the risk that this will be another example of consumer interests being shunted to one side in favour of others.

Only recently, the Government promised to knock £100 off the bills of 17 million households, but that promise is yet to be delivered on. Admittedly, following pressure, the Secretary of State came back with a legislative proposal a couple of weeks ago, but I am extremely concerned about media reports that surfaced at the weekend in which internal Government sources indicated that they might not implement the draft Bill at all. Indeed, we learned that the Government have allegedly already told energy investors that the Prime Minister’s draft Bill would be ditched if they felt that the big six power firms were doing enough to tackle high bills, and this approach has now also been confirmed by civil servants.

For the avoidance of doubt, will the Minister confirm in his summing up whether these assertions are true? If they are not, will he assure the House that no matter what pressure he, or indeed the Secretary of State, faces to shelve the energy price cap, the draft Domestic Gas and Electricity (Tariff Cap) Bill will be brought before this House and passed as urgently as possible?

--- Later in debate ---

[Patricia Gibson (North Ayrshire and Arran) (SNP)]

We in the Scottish National party support the roll-out of smart meters, but it is essential that maximising consumer and environmental protections lies at the heart of any strategy to do so.

It is empowering for consumers to have near real-time information on their energy consumption to help them to control and manage their energy use, and in turn save money and reduce emissions. If roll-out is effective and well managed, there are obvious benefits to consumers. Nearly eight in 10 people with a smart meter would recommend one to others, and the same number with a smart meter say they have taken steps to reduce their energy consumption. Those with an in-home display model in particular feel they have a much better idea of what they are spending on energy and check it regularly. If having new technology in their homes helps consumers feel that they can exercise better control over energy consumption and be better informed about their energy use, with greater control over their bills, then of course that must be welcomed.

In previous speeches, we have heard about switching suppliers. I would like to say, right at the outset, that switching suppliers has a limited effect. Research shows that people who switch tend to be those who are better off. They switch and they save money. However, there is not a sufficient impact on the lowest income households, which are in most danger of fuel poverty. They find it much more difficult to switch suppliers.

We often hear that smart meters are free to consumers. They are not. They are paid for through energy bills. Every household will, ultimately, pay for the new meter roll-out via their bills. It is important that consumers understand that having a smart meter is a choice. Trading Standards has expressed concern that data from citizens advice bureaux suggest that consumers are not being told that they can refuse a smart meter, if they so choose.

[Toby Perkins]

There is a really important point here about consumers from the lowest income households. Given that companies have different tariffs, why do the Government or the companies themselves not say, “We’ll stop you having the responsibility of deciding the best tariff for you. We have all the data. At the end of every quarter, we’ll look at your bill, tell you what would have been the best tariff and put you on it, so you always save the money without having to do all the work yourself”? Companies should have the information to be able to do that.

[Patricia Gibson]

What the hon. Gentleman says sounds eminently sensible. The problem is that the better off and most well-informed people are switching and saving. That is being subsidised by the people who are unable to switch and save because they do not feel up to the task. The poorest households are actually subsidising the most affluent households, which have the ability and the expertise to switch and save. That is a real issue that has to be addressed. Similarly, as mentioned before, those on prepayment meters—the poorest households in our communities—must have access to smart meters if they want them.

It is important, as part of this process, that the Government’s regulatory framework clearly establishes the rights and obligations of all aspects of smart metering design, development, installation and operation, as well as monitoring and reporting. Customers must be reassured, and continue to be reassured, that their data and security are robustly protected in the course of the smart meter roll-out. There is concerning evidence, however, that smart meters are being installed before the programme’s requirements as an internet-connected energy system have been fully determined. The UK Government must do everything in their power to protect consumers during the roll-out. There were disturbing reports last March in the Financial Times of GCHQ intervening in smart meter security, claiming to have discovered glaring loopholes in meter design, and causing some alarm. Such concerns must be fully addressed.

The plan to install smart meters in every home by 2020 must not leave consumers out of pocket. It must be asked whether the cost of the roll-out will be borne by all energy consumers. The successful operation of smart meters can also be a postcode lottery. In areas with a poor mobile signal, there is a real chance that smart meters will not work. If we are applauding the merits of smart meters, this has to be borne in mind, because digital inclusion matters.

Almost 100,000 fewer households were in fuel poverty in 2015 than in the previous year in Scotland, but there is still much more to be done. The Scottish Government have commissioned a review, due to be completed next year, of the definition of fuel poverty in order to inform a new fuel poverty strategy that will be followed up by a warm homes Bill. There has to be a focus on those in most need of help to heat their homes.