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Oral Answers to Questions
(2 months ago)
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Gerald Jones (Merthyr Tydfil and Rhymney) (Lab)
Feryal Clark (Enfield North) (Lab)
The Minister for Industry and Economic Security (Ms Nusrat Ghani)
My Department continues to help small and medium-sized enterprises to grow overseas and export to the world, especially this year—the year of the SME. Businesses can access a digital self-serve offer and a wide network of support, including trade advisers, export champions, the UK Export Academy, our international markets network and UK Export Finance. Last year, UK Export Finance provided £6.5 billion to exporters of all sizes, with SMEs comprising a record 84% of those supported directly with a product.
Gerald Jones
SMEs in Merthyr Tydfil and Rhymney tell me of their frustrations around exporting goods and now the Government have scrapped the trade show programme, which was set up to support British businesses to attend events and win overseas orders. Will the Minister tell the House and the thousands of businesses that rely on that vital support when there will be a replacement?
Ms Ghani
UK exports are increasing. Using current prices, they are up by £21 billion compared with 2023. The UK trade show was a pilot programme that did not yield the successes we thought it would, so we have other schemes in place, including the UK Export Academy, international trade advisers, Help to Grow and the export support service. Focusing on Wales, we will soon be appointing a new international trade adviser to help SMEs.
Feryal Clark
We are lucky that Enfield North has quite a lot of small and medium-sized businesses, but they are suffering because of the cost of spiralling bills and no Government support. Does the Minister think it is the lack of a Government industrial strategy or the lack of individual support for exporters that is most holding our businesses back?
Ms Ghani
That is an extraordinary statement, because in the hon. Lady’s constituency the greatest level of exports is from professional and business services, and those exports are increasing not only to the EU but to countries outside the EU. That is the reality on the ground, so our strategy is working. UK exports were £859 billion in 2023—a figure that has gone up, not down, by £21 billion. The UK is the second biggest services exporter in the world—she should be proud of that because many such businesses are in her constituency. Those exports have increased to 54% from 48%, so there is good news, but we are keen to do more.
Gareth Thomas (Harrow West) (Lab/Co-op)
The Office for Budget Responsibility said yesterday that exports, including from SMEs, will fall even more than expected this year; growth in exports will be less than 1% in each of the next three years; and other countries will not be hit the same way. There have been cuts in the funding to help businesses start exporting and there has been no deal with the United States, no Diwali deal with India, and no veterinary agreement with the EU to cut red tape and slash costs. What does the Minister think is the best explanation for the Government’s dismal performance on exports so far?
Ms Ghani
We can get the best explanation from looking at the data behind what the hon. Gentleman set out. He obviously omitted the international reality. In the same report, the OBR referenced the “sluggish growth” in “global economies” and mentioned that British goods and services will outperform, on average, G7 countries. Those are the facts on the ground. When it comes to exports, we are exporting not only into the EU but outside the EU. As I said earlier, professional and business services are increasing outside the EU by 19%. We have substantial programmes in place to help small and medium-sized enterprises. We are keen to learn and do as much work as we can. There will be far more work coming through as this is the year of the SME.
Richard Thomson (Gordon) (SNP)
The trade and co-operation agreement has hit small and medium-sized exporters the hardest, as most do not individually have the capacity to deal with the additional bureaucracy and paperwork created by that trade deal. Does the Minister recognise that the TCA has disproportionately damaged the competitiveness of SMEs? What support can the Government offer SMEs to recapture the market share they have lost in Europe since then?
Ms Ghani
There has not really been a loss in the market share. I have talked about what is happening internationally. We appreciate that small and medium-sized enterprises may not have the resources they need to export into new markets. That is why we have the UK Export Academy, international trade advisers, Help to Grow and the export support service. We are also looking at what trade barriers we can break down and bust to make it even easier for SMEs to access new markets through the trade deals secured by the Secretary of State.
Alex Cunningham (Stockton North) (Lab)
The Minister for Industry and Economic Security (Ms Nusrat Ghani)
Our commitment to the UK steel sector is clear. The Government are contributing up to £500 million in a joint investment with Tata Steel. We are in talks with British Steel following our generous offers of support. We have delivered more than £730 million in energy costs relief since 2013, and the British industry supercharger is coming soon. We updated our procurement policy note to ensure we are procuring more in the UK, and we are trying to do everything we can to continue to support the steel sector.
Alex Cunningham
We are all disappointed that the Government, having abandoned Teesside steel several years ago, are now ready to give up on primary steelmaking in the UK and to rely on recycled material utilising electric arc furnaces. I am pleased to hear that Teesside is pencilled in for one of them, but not so pleased that there have been attempts locally to circumvent proper procedures to secure planning consent. Will the Minister look into that? More importantly, will she confirm that the Government have a final copper-bottomed agreement with the industry that the furnace will definitely be built on Teesside?
Ms Ghani
A number of the issues that the hon. Gentleman raises are fundamentally locally. We work closely with Mayor Ben Houchen, who has done a remarkable amount of work for his part of the country. The reality is that the steel sector was placed in an area of uncertainty for some time. We were able to provide support for Tata, which has ensured that the steelworks continue at Port Talbot. We provided the largest grant ever made available to steel, and we are now in conversation with British Steel. That is what it means to have a long- term steel strategy to ensure that steelmaking continues here in the UK.
Craig Tracey (North Warwickshire) (Con)
The Parliamentary Under-Secretary of State for Business and Trade (Kevin Hollinrake)
On 1 February, the Government reaffirmed our commitment to all the UK’s 5.5 million small businesses with the creation of the new Small Business Council, which is looking at key areas, such as improving business support, access to finance, support and advice, and breaking down barriers, including barriers to female entrepreneurship.
Craig Tracey
As chair of the women and enterprise all-party parliamentary group, it has been fantastic to see the boom in female-led businesses over the past few years. We now want to see consideration of how some of them can grow. Can the Minister set out how the new Small Business Council can help them to do that?
Kevin Hollinrake
I thank my hon. Friend for his question and for all he does for women in entrepreneurship and on the APPG, on which he has worked for many years. The Small Business Council has excellent entrepreneurs on it, such as Emma Heal from Lucky Saint and Julianne Ponan from Creative Nature, who we rely on for expert advice. We also have the investing in women taskforce, which has helped to increase the number of female entrepreneur businesses from 56,000 in 2018 to 150,000 in 2022. The investing in women code has 240 signatories. We are keen to do more and to work alongside my hon. Friend to ensure that the world of entrepreneurship is as friendly as possible to female entrepreneurs.
Mr Barry Sheerman (Huddersfield) (Lab/Co-op)
Will the Minister ask the Small Business Council to wake up to the opportunities in the hydrogen sector, not only in terms of the engineering that supplies that sector, the coming replacement of batteries and all that transportation stuff, but in the infrastructure of our country? We have great engineering that is ready to go with a hydrogen future. When will he wake up to that opportunity?
Kevin Hollinrake
We already have woken up to that opportunity. As the hon. Gentleman knows, we have great opportunities in hydrogen in Teesside and in Yorkshire, with the Humber hydrogen cluster. It is something we are keen to support as a Government, and I would appreciate it if he offered his support, too.
Rushanara Ali (Bethnal Green and Bow) (Lab)
The perfect storm of rising borrowing, rent and labour costs is continuing to cripple businesses, and the UK small business index fell 78 points last December, according to Xero Small Business Insights, to the lowest reading since the middle of the pandemic in August 2020. The Government have had 14 years to tackle the barriers facing SMEs. What specifically will the Small Business Council do, and what will Ministers do to halt the alarming trend of more businesses closing than opening?
Kevin Hollinrake
I am sorry that the shadow Minister is so pessimistic about the world of business. We have spoken at events together many times, and she hears the mood in those audiences, which is far more positive than she sets out. We are active in many areas, as she knows. At the event we both spoke at this week, I talked about access to finance, support and advice, and removing barriers. Access to finance has been key, with £1 billion of Start Up loans having been made to 100,000 businesses. If she listened to the Budget yesterday, she will have heard about the rise in the VAT threshold and the growth guarantee scheme. There are many opportunities for small businesses. We will have 200,000 more workers coming back into the workplace, tackling another barrier for businesses. Get with the programme; it is much more exciting than she thinks.
Nicola Richards (West Bromwich East) (Con)
Bob Blackman (Harrow East) (Con)
The Secretary of State for Business and Trade (Kemi Badenoch)
Israel remains a part of the FTA programme, and negotiations continue. I had a productive meeting with Israel’s Minister of Economy, Nir Barkat, last week in Abu Dhabi, where we discussed our existing trading relationship as well as how Israel is managing the challenges of working on an FTA while fighting a war.
Nicola Richards
Israel is facing immense challenges in its war with Hamas, but it is known around the world as a start-up nation thanks to its extraordinary tech sector, which Brits benefit from every day. Given the enormous opportunities that a bespoke free trade agreement with Israel offers to the UK, will my right hon. Friend update the House on what steps she is taking to advance negotiations?
Kemi Badenoch
My hon. Friend will be pleased to know that we held a virtual negotiating round with Israel in February, focused primarily on services. That is one of the things that we are doing to move the FTA forward, and we will update Parliament shortly in the usual way via a written ministerial statement.
My hon. Friend is right to highlight Israel’s world-leading tech sector, which is a reason why we want to modernise and upgrade our relations with Israel. Our current FTA was signed in 1995—it is a roll-over from the one we had with the EU—and technical collaboration, which Israel specialises in, will be made easier through an enhanced FTA.
Mr Alistair Carmichael (Orkney and Shetland) (LD)
Can the Secretary of State give me some assurance that any free trade agreement with Israel will not allow the importation of goods produced in settlements on the west bank?
Kemi Badenoch
Yes, I can give the right hon. Member that assurance. We are clear under our existing UK-Israel trade and partnership agreement that Israeli goods originating from the State of Israel receive tariff preferences. We also have a separate interim agreement between the UK and the Palestinian Authority. I confirm that that will continue to be the case with an upgraded FTA with Israel. We will not compromise our long-standing positions on the middle east process throughout this negotiation, including with respect to settlements.
Andrew Rosindell (Romford) (Con)
The Minister for Trade Policy (Greg Hands)
The United Kingdom has trade deals with 33 Commonwealth countries, and our new developing countries trading scheme offers more generous tariffs, rules of origin and trading conditions to developing countries, including 19 Commonwealth countries. The UK-Australia FTA has seen sharp rises in many UK export sectors, including furniture tripling year on year and car exports doubling. Meanwhile, of the 11 parties to the comprehensive and progressive agreement for trans-Pacific partnership, six are Commonwealth countries, and that agreement gives us new or improved access to those important markets.
Andrew Rosindell
Mr Speaker, I know that you will be celebrating Commonwealth day on Monday with the raising of the Commonwealth flag. Will the Minister take this opportunity to expand our trading relations with the Commonwealth and look at the idea of an opt-in, opt-out WTO-style organisation involving all Commonwealth countries? Surely this is a great opportunity to expand our trade with some of the world’s emerging economic powerhouses.
Greg Hands
I thank my hon. Friend for that question and his commitment to the Commonwealth. As a constituency MP with a huge Commonwealth diaspora in Chelsea and Fulham, I totally understand his sympathies and look forward to celebrating Commonwealth day with him and others next week. He knows that the Commonwealth does not make trade rules, nor is it a trade agreement body like the Gulf Co-operation Council, the European Free Trade Association or the CPTPP. We think that the better course at present is to ratify our CPTPP membership and continue to have reduced tariffs under our developing countries trading scheme. However, we are always open to new ideas at the Department for Business and Trade and I am happy to meet my hon. Friend to discuss this further.
Jim Shannon (Strangford) (DUP)
I thank the Minister very much for a positive response. The Commonwealth is important for all of us. The value of UK exports to the Commonwealth increased by 23% in cash terms between 2021 and 2022, while the value of imports from the Commonwealth increased by some 30%. We can clearly benefit each other. How can we ensure that Northern Ireland companies benefit fully from this enhanced trading partnership?
Greg Hands
Of course, Northern Ireland benefits from all our free trade agreements. I very much look forward to putting the case for Northern Irish goods and services in the months ahead. We have economic partnership agreements with 27 Commonwealth countries. We also have the Commonwealth Heads of Government meeting in October to look forward to, where we can ensure that the export of Northern Irish goods and services, as well as those from the whole of the UK, takes centre stage.
Martin Vickers (Cleethorpes) (Con)
The Secretary of State for Business and Trade (Kemi Badenoch)
Since we left the EU, we have used our new freedoms to secure free trade deals with 73 countries, including EU partners, and that accounted for £1.1 trillion of UK trade in 2022. We have simplified import tariffs to lower costs for businesses and households. We plan to remove over 50% of inherited EU regulations by 2026. Our reforms to employment laws could save UK businesses up to £1 billion a year, ensuring that the UK is the best place in the world to start up and grow a business.
Martin Vickers
I thank my right hon. Friend for her reply. Measured by tonnage, the port of Immingham in my constituency is the largest port in the country, with almost 50 million tonnes of cargo each year. It is also a vital part of the renewable energy sector. Immingham is surely an example of the fact that not only EU trade but worldwide trade is important to the UK. If my right hon. Friend were able to visit at some time, she would be able to see that for herself.
Kemi Badenoch
As ever, my hon. Friend is a great advocate for his Cleethorpes constituency. He is right that Immingham is the No. 1 port in terms of tonnage and is vital to our trade with the EU and the rest of the world. If our diaries allow, I or one of my Ministers will be delighted to visit and see at first hand the vital role Immingham plays in the transition to renewable energy.
Kirsten Oswald (East Renfrewshire) (SNP)
In December, the British Chambers of Commerce found that a staggering 97% of surveyed businesses continued to face difficulties using the trade and co-operation agreement. Despite the TCA being introduced over three years ago, businesses are still struggling to deal with the added headache that the regulations have created. If 97% of businesses still face difficulties after three years, how many years is it anticipated that it will take for these issues to be resolved?
Kemi Badenoch
I thank the hon. Lady for her question. Many of the issues that businesses have been raising with us are specific not to the TCA but to member countries. That is why Ministers and I, along with officials, go to all these countries, and we have removed many of the market access barriers, which are not specific to the TCA. The hon. Lady will know that the TCA will be up for review. If she has specific things she would like us to take to EU Trade Commissioners, we are very happy to do so.
Mr Tanmanjeet Singh Dhesi (Slough) (Lab)
This week, the Financial Times reported the most significant decline in UK trade volumes since 1997. It is clearer than ever that this Government’s hard Brexit policy has exacerbated challenges for British businesses. With a 7.4% drop in trade since 2018 and exports down by 12.4%, we are starkly lagging behind our G7 peers. Can the Secretary of State explain how 14 years of Conservative rule have prepared British businesses for their despair around extra red tape and the chaos unleashed by this Tory hard Brexit policy?
Kemi Badenoch
I think the hon. Gentleman has just time-travelled from 2018 or 2019—it has been a long time since I have heard the phrase “hard Brexit”. He will of course know that we left the European Union with a deal, so he needs to catch up with what has actually happened. It is also interesting that he talked about an FT report from 1997; I should let him know that we have not been in government since 1997—we have been in government since 2010. Many of the things he is pointing out are things we have said will occur as trade flows move away from the European Union to the Indo-Pacific. That is why we have left; that is why we are trading with the rest of the world. The hon. Gentleman should also know that our economy is 80% services, so most of the things he is talking about will not impact on the vast majority of the economy. Services exports are booming, and we are doing well since leaving the EU.
Sir John Whittingdale (Maldon) (Con)
The Minister for Trade Policy (Greg Hands)
We have excellent relations with South Korea, as my right hon. Friend will know as the Prime Minister’s trade envoy there. Bilateral trade totalled £16 billion in the 12 months to September 2023. Negotiations to upgrade our FTA with South Korea were launched as part of President Yoon’s state visit in November. Round 1 of the talks has already taken place, and round 2 will take place later this month here in London.
Sir John Whittingdale
On Tuesday, in my capacity as trade envoy, I attended the Korean embassy for the signing of a memorandum of understanding on the joint development of a small modular nuclear reactor—just one area in which the business between our two countries is growing ever stronger. Will my right hon. Friend press ahead with the enhanced free trade agreement, which will offer huge opportunities to build on the existing £17 billion trade relationship?
Greg Hands
My right hon. Friend is absolutely right. In the UK, of course, we have our own, superb Rolls-Royce model of small modular reactor as well. He is right about the importance of our growing trading relationship with Korea. As a former Secretary of State for Culture, Media and Sport, he will also know that 71% of our services trade with Korea last year was delivered digitally. We need to upgrade the deal to make sure that it reflects modern, digital trade as well. Both countries are making good progress in the negotiations.
Mr Laurence Robertson (Tewkesbury) (Con)
The Minister for Trade Policy (Greg Hands)
The Government were pleased that my hon. Friend, who is the Prime Minister’s trade envoy to Angola, Zambia and Ethiopia, and members of the Westminster Africa Business Group visited Zimbabwe on the group’s inaugural trade mission. That is part of the Government’s work to promote opportunities for UK companies, particularly in critical minerals, renewable energy and sustainable agriculture.
Mr Robertson
I am grateful to the Minister for that response. On my visit to Zimbabwe in January, I met the President and a number of other Ministers. They made it very clear that they wanted to draw a line under the past, move forward and increase friendship—and, indeed, trade links—with this country. What more can the Government do to enlighten companies and businesses in the UK about the many opportunities in Zimbabwe?
Greg Hands
I thank my hon. Friend for his report and letter to me all about that. I am pleased with the high-level meetings he had on his recent visit and a lot of the media coverage. Our embassy is following up by preparing for the Zimbabwe international trade fair in April, and it is expecting a strong UK presence. My hon. Friend’s return visit in April will be a perfect chance to progress the deals that we have and boost British investment for this year and beyond.
Daniel Zeichner (Cambridge) (Lab)
The Minister for Trade Policy (Greg Hands)
The Government are committed to pursuing environmental provisions in our trade agreements and to using our multilateral trade policy, diplomatic efforts and trade promotion activity, all of which support our green objectives.
Daniel Zeichner
The Government boast about the trade deals they have done and the environmental protections they have secured, so presumably they have had the chance to analyse the impact. Will the Minister tell the House whether the deals secured so far have improved or degraded our environment? What lessons have been learned for negotiating future deals?
Greg Hands
The hon. Gentleman raises an interesting point. Many of the agreements have actually, for the first time, included environmental provisions. If I recall correctly, he did not like the Australia trade deal, but it is the first time Australia has committed in a trade agreement to the Paris agreement and so on. When it comes to the impact of our trading policy over the last 14 years, he will also find, for example, that 86% of UK imports of palm oil—a key interest for environmentalists—are certified as sustainable, up from 16% in 2010. Again, we are seeing real results of UK trade policy moving in a much more environmentally friendly direction.
Munira Wilson (Twickenham) (LD)
The Parliamentary Under-Secretary of State for Business and Trade (Kevin Hollinrake)
Some 130,000 children are in the care of close family members in England alone. We recognise the vital role that kinship carers play in looking after children who cannot live with their parents. Last year, the Government published the national kinship care strategy and announced a £20 million package of support for kinship carers in 2024-25.
Munira Wilson
The Minister just referenced the Government’s kinship strategy, which was published in December. Their own strategy has recognised that kinship carers in employment often report the need to give up work or reduce their hours to be able to care for the children they support; it cites a survey revealing that 45% of kinship carers give up work and a similar number have to reduce their hours permanently. Given the Minister’s desire to drive up employment and the fact that kinship carers stepping up overnight to look after children saves the taxpayer a huge amount of money in comparison with when children go into local authority care, why are the Government not making paid employment leave a statutory right and only publishing guidance?
Kevin Hollinrake
The hon. Lady raises a very important point. We call on local authorities to be considerate to people who are in employment when they take on a child to look after in a kinship care situation. We think that employers are the right people to make sure that any provision we provide is a floor, not a ceiling. Companies such as John Lewis take a very considerate approach to people in that situation. We urge them to do so, but we also encourage local authorities, which have budgets allocated to this particular issue, to provide support where they can.
Matt Western (Warwick and Leamington) (Lab)
Graham Stringer (Blackley and Broughton) (Lab)
The Minister for Industry and Economic Security (Ms Nusrat Ghani)
High-quality infrastructure is crucial for delivering economic growth. To quote a previous Prime Minister:
“You and I come by road and rail, but economists travel on infrastructure.”
We know how important investment is. The whole House will agree that the UK is the leading light when it comes to offshore wind farms, where we are already securing investment.
Let me point to a few examples of further investment: Nissan is investing £2 billion in new electric car models in the UK, Microsoft and Google have announced data centres worth over £3 billion, and my Secretary of State oversaw the global investment summit, unlocking £30 billion of investment. In fact, since 2010 we have secured more inward investment than any other country in Europe. Over the last few years, we have received the third highest amount in the world, after the United States and China. I could go on, Mr Speaker, but I might test your patience.
Matt Western
That is all very well, but the Government’s decision to defer the banning of petrol and diesel vehicles until 2035 has led to huge uncertainty among consumers and investors, as the Minister well knows. Compared with other countries, it seems that the Government lack ambition when it comes to investment in electric vehicle infrastructure. France, for example, will have something like 400,000 installations by 2030—50% more than the UK. What plans does the Minister have to ensure that the UK’s investment keeps up with our competitors and meets the growing demand for electric vehicles?
Ms Ghani
As the Minister for the auto sector, I am very keen to ensure that we are breaking bad memes around the electric vehicle sector. We are doing a huge amount of work in this space. At the moment, we have 53,600 public charge points. We have a rapid charging fund and a local electric vehicle infrastructure fund— I am sure that the hon. Gentleman’s local authority will want to tap into those. The Department for Transport is working with local authorities to ensure that they have charging strategies. We have a £381 million local EV infrastructure fund, which will deliver tens of thousands more charging points and support for on-street residential charge points, too. It is really important that local authorities are aware of the funds available, and I suggest that the hon. Gentleman get in touch with the DFT to support the installation of charging points in his constituency.
Graham Stringer
I do not think that any hon. or right hon. Member could disagree in general terms with the Minister’s reply. It would have been a more interesting reply if she had made an assessment of the reduction in investment since the cancellation of High Speed 2, because there is no doubt, as she said, that investment in rail infrastructure leads to business investment all along the route. We can see that in Birmingham and Manchester, and we can now see the lack of new investment because of the cancellation. Was it not a mistake to swap that investment, which would have led to many new high-technology jobs, for money to replace what has been taken from local government to fill potholes?
Ms Ghani
In my previous response, I wanted to expose the opportunities and grants that are available to ensure that charging points are criss-crossing the country. Often parliamentarians are not aware of all the great work we are doing.
On HS2, just last week we announced the extra support that will be made available for local transport plans, which cover everything including rail, road and even buses and, of course, potholes. Network Rail has received £36 billion from the Government to improve transport in every region of the UK. Just last week, we announced an extra £4.7 billion of additional funding for local transport authorities in the north and midlands. We want to make sure that decisions on transport are made locally and that the infrastructure is needed and wanted by local communities, which is why we are making sure that the funds from HS2 are being made available.
Christine Jardine (Edinburgh West) (LD)
The Parliamentary Under-Secretary of State for Business and Trade (Kevin Hollinrake)
We are hacking through the red tape, not least with our smarter regulation programme. We have announced reforms to employment law and the recording requirements of the working time directive, which will save UK businesses up to £1 billion, particularly benefiting SMEs.
Christine Jardine
I note that the Minister welcomed yesterday’s Budget as helping small businesses, particularly in the hospitality sector, which is very hard hit in my constituency. One of the problems that many businesses tell us about is the business rates system. More businesses have failed in the past two and a half years than have been established. In Scotland, we often find that while the downsides of this Government’s policy are happily passed on by the Scottish Government, any benefits are not. We would like to see complete reform of the rating system—not tinkering but reform. Can the Minister tell us whether widespread reform is planned? How would he plan to do it? How could businesses in Scotland also benefit?
Kevin Hollinrake
The hon. Lady is absolutely right to point to some of the difficulties in the hospitality sector. I speak to hospitality entrepreneurs in my constituency and across the country who are finding it difficult, which is why we stepped in with, first, a package of about £13 billion of business rates support, and there was £4.3 billion of business rates support last autumn. We passed the equivalent moneys on to the Scottish Government to pass on to their hospitality venues, but they passed on none of it.
A typical pub in Scotland is £15,000 worse off than a typical pub in England, and a typical guest house is £30,000 worse off. That is why Scotland has a 30% higher failure rate than England. Similarly, a typical pub in Labour-run Wales is £6,000 worse off and a typical guest house is £12,000 worse off, and there is a 19% higher failure rate. It is critical that the benefits are passed on to those businesses, and that we look for structural reform. Anyone who wants to scrap business rates needs to show where the £22.5 billion of income will come from, rather than simply saying that they will scrap them without announcing a replacement.
Christian Wakeford (Bury South) (Lab)
The Parliamentary Under-Secretary of State for Business and Trade (Kevin Hollinrake)
Since 2011, we have published 20 press releases and named around 3,200 employers that have, in total, repaid over £41 million in arrears to over 460,000 workers. We have recently had round 20 of the scheme.
Christian Wakeford
Naming and shaming serves as a deterrent, but should we not go further against persistent offenders? Paying the minimum wage is not an opt-out; it is a law that no company is above. Stronger penalties, including fines proportionate to the severity of the violation, to ensure that no employer can exploit its workers with impunity, would level the balance between employers and employees. Will the Minister commit to exploring these measures to safeguard the rights and the dignity of workers?
Kevin Hollinrake
The hon. Gentleman is right to point to this measure. We know that naming and shaming is a significant deterrent against underpayment of the national minimum wage, and we are very keen to ensure that naming continues. Alas, in the most recent naming and shaming round, 2,800 minimum wage investigations returned more than £16.3 million in arrears to over 120,000 workers. His Majesty’s Revenue and Customs issued businesses with nearly 700 fines, totalling £13.2 million. As the hon. Gentleman recognises, naming and shaming alone is a significant deterrent and we intend to continue doing it.
Justin Madders (Ellesmere Port and Neston) (Lab)
My hon. Friend the Member for Bury South (Christian Wakeford) is right that too many employers still think they can opt out of paying the minimum wage. Earlier this week, the Low Pay Commission published its 2023 report, which said that non-compliance “appears persistent” in the social care sector. I have heard a range of evidence citing problems with record keeping, exploitation of migrant workers, and workers routinely not being paid for travel time.
It is clear that the social care sector has a real issue with the minimum wage but, when browsing through the latest naming and shaming list published by the Department a couple of week ago, I found only 17 employers classed as being within the social care sector, which is less than 0.1% of the total number of employers in the sector. What will the Minister do to ensure that everyone working in the social care sector gets at least the minimum wage?
Kevin Hollinrake
The hon. Gentleman is right to raise this issue, on which we do much. For example, we make sure that people can anonymously report the underpayment of the national living wage through either His Majesty’s Revenue and Customs or ACAS. It is really important that we do that. We have labour market enforcement undertakings and orders, and we provide the tools for serious cases. As of April 2022, 40 employers were on labour market enforcement undertakings and 18 employers have been prosecuted. The message should be loud and clear to employers that if they do not comply with the law, we will take action.
John Penrose (Weston-super-Mare) (Con)
The Parliamentary Under-Secretary of State for Business and Trade (Kevin Hollinrake)
My officials are co-ordinating and leading on the drafting of the road map, which will set out the Government’s ambition for future smart data scheme development across seven different sectors. We will publish that very shortly.
John Penrose
I am delighted to hear that the road map is coming very shortly. My hon. Friend will recall that I asked this question just before Christmas and he said it would be out in January. We were then hoping it might be coming out in yesterday’s otherwise excellent Budget, but it did not. Other countries are coming up on the rails and trying to overtake us. The noise of the approaching herd is growing in our ears, so can we please move as fast as possible on this?
Kevin Hollinrake
My hon. Friend is right to hold our feet to the fire on this. We are pressing forward and we are determined to get it right, not just out quickly. He rightly said that I set the ambition to get it out in January, and that has put officials’ feet to the fire as well in getting it out. I signed off the road map yesterday, so it should be out very shortly. I do not agree that other nations are hot on our heels on this issue, as we are way ahead. There are billions of calls in open banking every month, and millions are using this every day without even knowing it. We are going to extend those opportunities to energy, telecoms and, crucially, small and medium-sized enterprise finance, making the journey for SMEs to get business finance far easier.
Grahame Morris (Easington) (Lab)
The Secretary of State for Business and Trade (Kemi Badenoch)
Last week, I travelled to Abu Dhabi for the 13th World Trade Organisation ministerial conference, where I met counterparts from many countries, including Australia, New Zealand, Canada and South Africa, along with trade representatives from the United States, European Union and the Gulf Co-operation Council. Alongside WTO members, we negotiated real outcomes for the UK and important agreements with our trading partners. We delivered for British business through the renewal of the e-commerce moratorium, a global agreement to avoid taxes on online transactions, from emails to movies and music. Building on the momentum from the 13th ministerial conference, we will continue to champion free, fair, open trade at every opportunity, recognising its potential to lower costs and increase prosperity, both here in the UK and around the world.
Grahame Morris
I thank the Minister for that statement.
We are no longer constrained by European competition law. The German Government are providing at least €6 billion in support for their steel industry. Given the very credible plan put forward by my union, Unite the union, to protect jobs and expand production at the steel plant at Port Talbot, why are the UK Government not investing more to create a viable future for our steel?
Kemi Badenoch
I am disappointed that the hon. Gentleman feels that we have not been investing as much as we should. What we have done in Port Talbot is the biggest investment that Government has ever made in steel. We are turning Port Talbot around; it is going to be regenerated. We are replacing high carbon emitting blast furnaces with electric arc furnaces to help reduce emissions, which his party and all of us across the House signed up to when we made the commitment to net zero. He may have specific things he thinks we can do on the transition, so I can tell him that we have a transition board to help those whose jobs are not going to be there with electric arc furnaces. However, we have done a significant amount for Port Talbot.
Sir John Whittingdale (Maldon) (Con)
The Minister for Industry and Economic Security (Ms Nusrat Ghani)
I am grateful to my right hon. Friend for highlighting the Policy Exchange report, and I agree that the UK should not enter a subsidy race with other industrial nations. We already have our advanced manufacturing plan, which, obviously, focuses on advanced manufacturing, and the Chancellor is also looking at green industries, life sciences, creative industries and digital technology. Those are all areas in which we know we can grow as well. I have spoken about the record levels of investment we get into the UK. Last autumn, when the Chancellor announced full expensing, more than 200 business leaders and the CBI said that that was a game changer and the single most transformative thing we could do to fire up the British economy. We will continue to be competitive and ensure that we continue to be the third country, after the USA and China, in securing inward investment—of course, beating our European counterparts.
Jonathan Reynolds (Stalybridge and Hyde) (Lab/Co-op)
Last month, the Secretary of State said at the Dispatch Box that she could state explicitly that trade talks with Canada had not broken down. However, the Canadian high commission has since contradicted that in writing, saying that neither negotiations nor technical discussions with respect to any of the outstanding issues have occurred since the UK unilaterally broke them off on 25 January. Mr Speaker, I just want to know who is telling the truth.
Kemi Badenoch
I am very happy to expand on what I said last time I was at the Dispatch Box on this topic. I repeat that our engagement with Canada on trade issues has been extensive across multiple Departments covering the free trade agreement, cheese quotas and rules of origin. On 25 January, the UK confirmed to Canada that we would pause FTA talks on the basis that cheese access had been removed and that Canada had signalled that rules of origin provisions would not be extended. That is how negotiations work.
I can tell the hon. Member that there was a meeting on 8 February between the Foreign Secretary and his Canadian counterpart where the cheese issue was discussed, and I raised cheese and rules of origin directly with the Canadians in Abu Dhabi last week. I must say to the hon. Member that chasing headlines based on things he has been told by the people with whom we are negotiating is not helpful to achieving the outcomes that our businesses, farmers and auto industry want to see.
Jonathan Reynolds
That was a lot of words for the Secretary of State to use to say that she believes the Canadian high commission was correct in the answer that it gave.
May I ask an important question about the proposed UK carbon border adjustment mechanism? Labour very much supports the introduction of a UK CBAM, but we are concerned that the Government will do so a year after the EU, resulting in the UK potentially being flooded with carbon-intensive products originally destined for Europe, including steel, cement and fertiliser. Do the Government recognise that danger? If they do, what is their plan?
Kemi Badenoch
Just on the first point, if the hon. Member still wants to believe Canada before the UK, that is his business, but we on the Conservative Benches know who we are working for, and we are working for British businesses.
On the hon. Member’s second point, carbon leakage is a global problem facing all countries that are ambitious in tackling climate change, and we are working with international partners on how we tackle it together. We are following developments on the EU CBAM closely, and we are engaging with the European Commission to discuss technical considerations relevant to UK manufacturers. We share its concerns on carbon leakage, but we need to make sure that the UK response, whatever it is, is tailored to what the UK needs, not just a copying and pasting of what others are doing.
Mr Philip Hollobone (Kettering) (Con)
Kemi Badenoch
I commend the Ball Corporation in Burton Latimer for all it is doing. I also thank my hon. Friend for what he is doing to promote inward investment, which supported more than 2,800 jobs across the east midlands in 2023. He has spoken to me before about the importance of the Ball Corporation to Kettering, and I am happy to confirm that either myself or one of my Ministers would be delighted to visit when diaries allow.
Richard Thomson (Gordon) (SNP)
While the UK Government struggle to support small and medium-sized enterprises exporting to Europe, they are providing a £600 million export guarantee to INEOS so that it can build the largest chemical plant in Europe for 30 years in Antwerp, Belgium. Why can the UK Government find £600 million to support that investment, but not match the £500 million that the Scottish Government are investing in domestic energy transition at home?
Kemi Badenoch
UK Export Finance does not give the money; it provides guarantees to loans that are being provided by banks. There is quite a significant distinction: we have not given that money; we have guaranteed a loan. The reason why we provide those guarantees is that they guarantee jobs to British businesses. There is a big difference between a loan guarantee and giving money. If he would like more of an explanation on that, we are happy to provide one to him.
Andrew Rosindell (Romford) (Con)
The Minister for Trade Policy (Greg Hands)
I thank my hon. Friend, who is a leading member of the British-Switzerland APPG, for his interest. Both the Secretary of State and I met the Swiss Trade Minister in Abu Dhabi last week. The trade talks are progressing well. We are seeking high-ambition outcomes in all areas, including services and investment, mobility, digital, and the environment, which are not covered by our existing FTA. In short, there are a large number of high-priority areas for us, building on the agreement that we did on financial services in Bern at the end of last year, to ensure that this UK-Switzerland FTA really takes forward the bilateral trade relationship. The fourth round of negotiations is taking place in Bern this week.
Marsha De Cordova (Battersea) (Lab)
Kemi Badenoch
The hon. Lady raises a significant issue around ensuring that disabled people are able to access employment and are paid properly. We have no plans to introduce mandatory disability pay gap reporting—no plans to introduce disability pay gap reporting at all. Unlike gender pay gap reporting, which is very simple, binary and easy to execute, disability pay gap reporting, like ethnicity pay gap reporting, is very complex. There are a range of disabilities that could not be easily monitored, so I would like to work with her on other areas where we can help to improve the lives of disabled people at work. We do not believe that disability pay gap reporting is the answer.
Greg Smith (Buckingham) (Con)
Kemi Badenoch
My hon. Friend is right. Israel’s current relationship with the UK is worth about £6.4 billion, but our FTA is a roll-over of the one that Israel signed in 1995 with the EU. It does not take into account services, digital, artificial intelligence or genome sequencing. There is a lot that we can do. That is why we are working on this FTA. It is a priority for us. As I said earlier, we face many challenges in carrying on negotiations with a country that is at war, but we are working to overcome them.
Munira Wilson (Twickenham) (LD)
The Parliamentary Under-Secretary of State for Business and Trade (Kevin Hollinrake)
The hon. Lady raises an important point. We do not shy away from the fact that things have been difficult for businesses, with the covid crisis, of course, followed by the cost of doing business crisis. That is why we stepped in to support businesses, with a £4.3 billion package for rates last autumn, which has helped many businesses to get through a difficult time. Unfortunately, that support has not been passed on in Scotland and Wales, but it certainly has in England. I am very happy to meet with her to discuss her particular business problem.
Mr Laurence Robertson (Tewkesbury) (Con)
Kemi Badenoch
My hon. Friend is right. I signed the enhanced trade and investment partnership in Nigeria, alongside my counterpart, Dr Doris Uzoka-Anite, on Tuesday 13 February this year. It was the first of its kind in terms of the UK’s trade commitments across the region. The partnership aims to remove market access barriers and promote technical co-operation in areas such as financial and professional services. The UK and Nigeria have co-created a partnership that tackles issues that businesses face, and this is the first step in a significant relationship and an already strong trading partnership worth a total of £6.7 billion in the 12 months to September.
Liz Twist (Blaydon) (Lab)
Kevin Hollinrake
We have always been clear that the £1 billion is not a cap. Clearly, the amount of compensation that needs to be paid for redress is to get people back to where they were before the scandal took place. At the moment, we are not nearing that £1 billion, but I think that over time we will be. As I say, it is not a cap; if we need to raise the amount, we will.
Bob Blackman (Harrow East) (Con)
I understand that another round of negotiations is about to start in India on our long-promised trade deal. The original proposal was to complete the trade deal by Diwali. This year, Diwali is on 1 November, so will the Secretary of State give us an update on negotiations and agree that we should conclude the deal by 1 November?
Greg Hands
I thank my hon. Friend for that question and for his continual interest in us getting a high-quality trade deal with India, for which he has long been a passionate advocate. Of course, the most important thing is what is in the deal, rather than the date that it is delivered. We remain in round 14 and we recently welcomed Government of India negotiators to London. The prize remains large—with tariffs as high as 150% for whisky and 125% for autos—and we want to ensure that we get our key service sectors able to export into a market of 1.4 billion people.
Liam Byrne (Birmingham, Hodge Hill) (Lab)
The Secretary of State will have seen the recommendations that our Committee set out this morning for ending the circus of the Post Office administration of the redress schemes for victims of the Horizon scandal. I know that she takes this incredibly seriously and so I know that she will study our cross-party recommendations for the new legislation that she is about to bring before the House. The question for today is this: if we put all the ongoing investigations to one side, on the basis of the facts as they are known today, does she still have full confidence in Nick Read as the chief executive of the Post Office to run the redress schemes currently under way?
Kevin Hollinrake
We thank the right hon. Gentleman for his work. I have taken a quick look at the report, although it was only issued this morning. All the recommendations he makes in that report we have either fixed or are fixing with the assistance of the Horizon compensation advisory board. We agree with him that we need to bring the compensation schemes in house. The GLO—group litigation order—scheme is already being delivered by the Department for Business and Trade. We believe that further compensation will flow from our overturning of convictions. We will be overturning hundreds of convictions through legislation in this House very shortly, as quickly as possible, and that will provide a flow of hundreds of millions of pounds in compensation for those individuals. That will be done by the Department for Business and Trade.
Martin Vickers (Cleethorpes) (Con)
As the trade envoy to the western Balkans, the issue of Government-to-Government agreements is raised with me frequently. There is no doubt that if they were available, more deals could be done with the Balkan countries. Will the Minister give an update on the Government’s position, please?
Greg Hands
I thank my hon. Friend, in particular for his brilliant work as a trade envoy. He covers more markets than any of our other trade envoys with great skill and dexterity. Back in 2017, this Department and I were pioneers in putting in place a G-to-G agreement with Peru for the UK to be the delivery partner for the 2019 Pan American games. A great deal of business with and in Peru has resulted since. We remain open to future G-to-G agreements on a case-by-case basis. I am happy to meet him to discuss what specific things he has in mind that would work in the western Balkans.
Stephen Kinnock (Aberavon) (Lab)
I have repeatedly asked Ministers whether any strings were attached to the £500 million of taxpayers’ money that was given to Tata Steel, particularly with regard to job guarantees. I have not had a straight answer, so I will try again today. Can the Secretary of State please confirm whether any conditionality was attached to the £500 million, or did the Government simply buy Tata Steel’s bluff about closure, and give it £500 million so that we could make 2,800 people redundant?
Ms Ghani
The hon. Gentleman attends the transition board meetings, so he knows that his question is not really relevant to what he is trying to get to the bottom of. We provided £500 million to ensure that steel making continues in Port Talbot. Tata made it clear that it was uneconomic and unsustainable to continue with steel making, so the support that we have given will ensure that north of 5,000 jobs will continue in Port Talbot, and it will support supply chains. On top of that, £100 million has been provided to the transition board, so that its members, including the hon. Gentleman, the unions and all the local representatives, can ensure that local people who need to go through transition get the support that they need. Without that support, there would not be any future steel making at Port Talbot.
Mr Barry Sheerman (Huddersfield) (Lab/Co-op)
When will the Secretary of State wake up to the huge potential of universities to tackle all the problems in society, including climate change? Will she come to Huddersfield, which has one of the best universities in the country? It is working with local businesses to make the future safe for our country.
Kemi Badenoch
If the hon. Gentleman sent a proposal to my office about what we could do on a visit to the University of Huddersfield, I would be very keen to take a look. We support our universities. If he has a specific business and trade angle in mind, we will see what we can do, if diaries allow.
Richard Foord (Tiverton and Honiton) (LD)
Mr Hussein from east Devon, whom I represent, has effectively been robbed of £100,000, given that £40,000 of sub-standard building work has to be levelled and destroyed. The Federation of Master Builders has campaigned for a compulsory licence scheme for construction companies. The Domestic Buildings Works (Consumer Protection) Bill would outlaw cowboy builders, provide compensation for consumers and ensure that reputable builders were not undercut by unlicensed rogues. Will the Minister take a fresh look at that Bill?
Kevin Hollinrake
The hon. Gentleman raises an important point. Some of the most frequent correspondence that I get from colleagues from across the House relates to rogue builders. We are determined to ensure that this does not happen to our constituents. We advise them to use builders registered with TrustMark, which is a trusted scheme, to ensure that work is done properly. I would be very happy to meet him to discuss that potential legislation.
Kirsten Oswald (East Renfrewshire) (SNP)
Goldman Sachs has found that Brexit Britain has significantly underperformed compared with other advanced economies; the result is that UK GDP is 5% lower than it would have been had we not left the European Union. Does the Secretary of State appreciate that best way to grow the economy, boost business confidence and reduce trade barriers is to rejoin to the EU?
Kemi Badenoch
I recommend to the hon. Lady the report produced by my Department on 31 January about the benefits of Brexit. It explains exactly what is happening with the UK economy. Claiming that GDP would have been 5% higher when we are outperforming our G7 partners is simply not credible. She wants to take us back to square one, but that is exactly the reason why people need to stick with the Conservative plan.
Jim Shannon (Strangford) (DUP)
I am very encouraged by the Secretary of State’s comments about the free trade deal with Israel. The UK is a friend of Israel, and Israel is a friend of the UK, so what more can we do to increase trade between us? More importantly—and very regionally —how can the Secretary of State ensure that Northern Ireland is very much part of that trade deal, so that companies in Strangford and across Northern Ireland also feel the benefit?
Kemi Badenoch
The hon. Gentleman will remember that we had the Northern Ireland investment summit, at which we talked about bringing more investment into Northern Ireland. He will know that around 500 Israeli firms operate in the United Kingdom. That investment from overseas is creating thousands of jobs in high-value sectors, and a free trade agreement will help to increase the investment. That will benefit businesses in Northern Ireland, too.
Business of the House
(2 months ago)
Commons ChamberRead Full debate Read Hansard Text Watch Debate Read Debate Ministerial Extracts
Lucy Powell (Manchester Central) (Lab/Co-op)
Will the Leader of the House give us the forthcoming business?
The Leader of the House of Commons (Penny Mordaunt)
The business for the week commencing 11 March will include:
Monday 11 March—Continuation of the Budget debate.
Tuesday 12 March—Conclusion of the Budget debate.
Wednesday 13 March—Consideration of an allocation of time motion, followed by all stages of the National Insurance Contributions (Reduction in Rates) (No. 2) Bill.
Thursday 14 March—Estimates day. There will be debates on estimates relating to the Department for Education, in so far as it relates to special educational needs and disabilities provision; and the Home Office, in so far as it relates to asylum and migration. At 5 pm, the House will be asked to agree all outstanding estimates.
Friday 15 March—Private Members’ Bills.
The provisional business for the week commencing 18 March includes:
Monday 18 March—Proceedings on the Supply and Appropriation (Anticipation and Adjustments) Bill, followed by consideration of Lords amendments to the Safety of Rwanda (Asylum and Immigration) Bill.
Tuesday 19 March—Remaining stages of the Trade (Comprehensive and Progressive Agreement for Trans-Pacific Partnership) Bill [Lords].
Further business will be announced in the usual way.
Lucy Powell
This week, the Secretary of State for Science, Innovation and Technology made a grovelling apology and retracted baseless allegations she made against a member of her own advisory body on her personal Twitter account—allegations that were based on a dodgy dossier produced by a Conservative think-tank. Remarkably, the damages paid out came from taxpayers’ money from her Department. This is a new low for ministerial standards, so perhaps the Leader of the House can clarify a few things. Was the £15,000 paid in damages the total cost borne by the Department for Science, Innovation and Technology? Apparently, the Secretary of State was given appropriate advice, but did she follow it, or were her accusations against the advice she received? If they were, surely she should personally pay the costs.
Will the Leader of the House urgently ensure that the Secretary of State is accountable to Parliament? The Government cannot have it both ways: if the money was paid by taxpayers because it related to the Secretary of State’s ministerial responsibilities, she must come to Parliament as a Minister and account for that. Other Ministers were told that their Twitter accounts were matters for them personally. Does the Secretary of State still have the confidence of the Leader of the House?
All we got from yesterday’s Budget was old news, briefed and leaked to the papers before it was given to Parliament. The next time that the Leader of the House cries crocodile tears for the rights of this place, she could reflect on the Government’s failure to stand by the parliamentary convention that Budgets are delivered in the Chamber first. I am sure that she was relieved that her marginal constituency did not get a namecheck, because her colleagues were all complaining that their namecheck was the kiss of death.
On the substance, the verdict is now in. The Office for Budget Responsibility forecasts that tax receipts as a proportion of GDP are set to rise to their highest level since the second world war. The Resolution Foundation says that the big picture has not changed: taxes are heading up, and this will be the first Parliament in modern history in which living standards fall to be lower at the end than they were at the start. The Institute for Fiscal Studies agrees that households are worse off since the last election, and no sooner had the Chancellor sat down than the Under-Secretary of State for Energy Security and Net Zero, the hon. Member for West Aberdeenshire and Kincardine (Andrew Bowie), criticised a key plank of the energy plans on Twitter.
The public’s verdict is also in. A snap poll revealed that three in five voters think that the Government’s plan is not working. The Sky News panel of 2019 Tory voters could not have been more damning: one voter said that the Budget was “absolutely farcical”. Another said that the Government have “no plans”, and thought that the Budget was “a great vote loser” and “A waste of time”;
“time for them to go”,
said a third. That is because on the big issues, this Budget changes nothing.
On taxes, for every 5p the Government are giving, they are taking 10p in tax rises. Millions more middle-income families are paying more and more tax on their earnings, as they are dragged over higher tax thresholds. Taxes are going up to their highest level in 70 years; the Government hate it, but that is the reality. That is the truth of this Conservative Government. On the public finances, borrowing has been revised upwards, with the Chancellor’s measures in the Budget adding £4 billion to borrowing, and debt as a share of GDP at its highest since the 1960s. Borrowing to fund tax cuts—how irresponsible.
On growth, after everything the Chancellor announced was taken into account, growth forecasts were revised down from November. Growth figures would have been even worse were it not for higher predictions of net migration. The Government hate that too, but is the truth. We are in a recession; the economy is smaller than when the Prime Minister entered Downing Street, there has been the biggest fall in living standards since records began, and real incomes are below what they were at the last election. That is the Conservatives’ record, and it has the Prime Minister’s name written all over it.
Finally, disgracefully, the Chancellor made no mention at all of infected blood compensation or Horizon scandal redress. The slowness in righting these wrongs is raised here most weeks. The Business and Trade Committee’s highly critical report, out this morning, calls for a legally binding timetable for delivering redress to sub-postmasters, and for that to be taken completely out of the hands of the Post Office. Does the Leader of the House agree? Given everything she has said on both these injustices, does she understand the anger that no new money was allocated, and no timetable was given, for those compensation schemes in yesterday’s Budget? Was not that omission just another short-term, cynical act that will store up problems for the next Government to sort out? As ever, it is party before country. These are the final acts of a desperate, dying Government.
Penny Mordaunt
I start by noting that tomorrow is International Women’s Day. I point out that on most Thursdays, the primary players in this session are three women, and sometimes there is a fourth in the Speaker’s Chair. It is sometimes noted that women are often the last to speak in meetings. That may be true, but we are often the first to set the right tone and approach. Politics needs more of us, and I hope that the spirit of tomorrow will carry into this important political year.
I turn to what the hon. Lady said about a female colleague of ours, the Secretary of State for Science, Innovation and Technology. The hon. Lady can no doubt obtain from the Department details of some of the issues that she raised. However, I remind the House, because the hon. Lady was really probing the character of the Secretary of State, that when the latter was entitled to a redundancy payment of £16,000 for having been a Secretary of State, she did not take it, but handed it back to the Department, because that was the right thing to do. That speaks volumes about my right hon. Friend’s character, and how much she values the fact that we are talking about taxpayers’ money.
I see that the hon. Lady is channelling Elmer Fudd this morning. Bugs may not have been in the Chancellor’s hat, but there was support for businesses large and small, help for households, tax cuts for working people, and help for single-earner families. Also, the price of fuel at the pump is being held down through another fuel duty freeze. We will ensure that the benefit of that is handed on to the consumer via Pumpwatch.
I will not take any lectures from the Labour party on stewardship of public services and getting growth into our economy. I will take no lectures on tax cutting from a Labour party that still has £28 billion of unfunded spending commitments, which can only be delivered through tax rises. It was the Labour party that left office with a £71 billion black hole in the defence budget and equipment programme. It was Labour that brought in the fuel duty escalator, and is clobbering the motorist in Wales and London. It is the Labour party in Wales that has cut the NHS budget, not once, but three times. That is in contrast to the increases that we have brought in, and the further £6 billion announced yesterday. Labour’s NHS budget cuts are one reason why a quarter of the population in Wales is on a waiting list.
I will not take any lectures from Labour on council tax, which rose by 104% under their Administration; again, in Wales, it has nearly tripled since Labour has been in power. We have reformed welfare to make work pay, doubled the personal allowance, cut national insurance and protected livelihoods and jobs through furlough, but Labour thinks it is a good use of taxpayers’ money to give asylum seekers £1,600 a month. I will not take any lectures on supporting those earning the least from a Labour party that brought in the 10p rate.
The hon. Lady’s rhetoric on growth and modernising our nation does not match her party’s agenda to unpick 40 years of trade union reform or tie businesses in red tape, and it does not sit well with its voting record on minimum service levels for the British public. I will not take any lectures from a party that did the square root of diddly squat for victims of infected blood and the Post Office. On that precise point, the hon. Lady clearly has not read the Red Book, which on page 24 commits us to paying full compensation to victims of the Horizon scandal. The estimates are in there, but it also says that amount will be increased if needed.
This is a tough shift, post-pandemic and mid-war. But thank God it is our shift. Our country has turned a corner and we will get back to our inflation target soon, as the new forecasts indicate. The plan is working and we will stay that course, as we must. Otherwise, we will end up back where Labour left us: compared with today, that is a million more workless households, 400,000 more children and 200,000 more pensioners in absolute poverty, 4 million fewer in work, youth unemployment at 45%, literacy rates trailing rather than leading the world, and a third less spending on the NHS. No thank you, shadow Leader of the House. We will stick with the Prime Minister. Further business will be announced in the usual way.
James Daly (Bury North) (Con)
The Mayor of Greater Manchester’s vanity project of a 493-square-mile clean air zone has cost the taxpayer nearly £100 million. It has been supported by all Labour councils in Greater Manchester and Bury. Will my right hon. Friend make time for a debate to ensure that the voices of Conservative MPs who have campaigned against this ridiculous project can be heard again, and that this tax on hard-working people never sees the light of day?
Penny Mordaunt
I congratulate my hon. Friend on leading the charge on this matter. There is a legal obligation to comply with emissions in the shortest possible time, but we are reviewing that. He will know that Greater Manchester authorities have changed their tune and are now proposing an entirely different approach, thanks to the campaign that he has run and the support that he has galvanised among his communities. I congratulate him and encourage him to hold them to account.
Richard Thomson (Gordon) (SNP)
Following the frankly appalling behaviour of the Labour party leadership to disrupt the SNP’s Opposition day debate on 21 February —[Interruption.] Obviously, they do not like the truth. The Leader of the House told the House that she was sympathetic to the idea not only of the SNP getting another Opposition day debate but of taking it from the allocation given to the Labour party. Could she update the House on how her thinking has developed on those points?
Further to that, on the issue of ministerial responsibility, yesterday it was revealed that neither the Conservatives’ branch manager in Holyrood nor their Energy Minister supports the Government’s energy policy. Will the Leader of the House confirm whether the principle of collective responsibility in government applies to junior Ministers? If so, what advice would she give to any Minister who is unable to support such a key plank of Government policy, either publicly or in any Budget votes ahead?
Finally, the Secretary of State for Science, Innovation and Technology has cost the taxpayer £15,000 after falsely accusing an academic of supporting Hamas. Could we have a debate on the limits of privilege, specifically whether it is now the Government’s policy that Ministers can say whatever they like outside Parliament and be financially indemnified from the consequences by the taxpayer? Does she consider it the taxpayer’s job to underwrite financially the Conservative party’s culture wars whenever its members overstep the mark?
Penny Mordaunt
I thank the hon. Gentleman for his questions. I have spoken to the leader of his party in Westminster regarding future Opposition day debates, and he knows that we will give more time to the SNP. I think SNP Members were badly treated and we will make that right. As I have explained, I also want to ensure that the Procedure Committee looks at what happened, because I do not want minority parties to receive more time on the Floor of this House and be in any doubt about how those debates will be conducted. I understand that Mr Speaker has written to the Procedure Committee to ask it to do a quick piece of work, and I will announce future Opposition-day debates for the SNP. I hope SNP Members will have confidence in what the Procedure Committee says.
The hon. Gentleman raised particular Budget measures. We have a balanced Budget—that is why the Chancellor made the decisions that he made. It is the Government’s Budget and the Government’s plan. It is rather cheeky of the hon. Gentleman to lecture us about use of public funds; I refer him to what I said earlier about the Secretary of State for Science, Innovation and Technology. The SNP is legendary in this respect. Indeed, I had wrongly assumed that the appalling Willy Wonka experience in Glasgow had been laid on by the SNP, given its high-cost poor return, and the fact that the police were called. However, the presence of a bouncy castle put paid to that theory, given that bouncy castles have been banned by SNP local authorities on health and safety grounds.
Dame Karen Bradley (Staffordshire Moorlands) (Con)
The lives of people across north Staffordshire have been blighted for far too long by the stench coming off Walleys Quarry landfill site in Newcastle-under-Lyme. There is delight that the Environment Agency has now issued a suspension notice, so will my right hon. Friend join me in paying tribute to our hon. Friend the Member for Newcastle-under-Lyme (Aaron Bell) for the work he has done on this incredibly important issue? Given that this issue affects communities up and down the country, including yours, Mr Speaker, will the Leader of the House find time for a debate on landfill sites?
Penny Mordaunt
I thank my right hon. Friend for raising that important point. It is unacceptable that residents in Newcastle-under-Lyme have, for far too long, had to put up with the appalling smells emanating from that quarry, and she is right to pay tribute to our hon. Friend the Member for Newcastle-under-Lyme. He has raised the issue many times in this House and has been fighting for his constituents. I think he secured two Westminster Hall debates on the issue, and it is in very great part down to his efforts that it is being resolved.
Ian Mearns (Gateshead) (Lab)
May I thank the Chair of the Procedure Committee for a timely and affirmative response to our request to examine the Westminster Hall Standing Orders? To that end, I have written to the Leader of the House this morning, and I hope she will give a similarly timely and affirmative response. The Backbench Business Committee welcomes applications from Members across the House, particularly for Westminster Hall debates, where they can probably be facilitated after the Easter recess as we are pretty booked up until then.
Penny Mordaunt
I again thank the hon. Gentleman for his helpful advert for his Committee. He knows that I very much agree both with his ask and with the advice of the Procedure Committee, so we will make that good innovation very swiftly.
Theresa Villiers (Chipping Barnet) (Con)
May we have a debate on defending the environment and quality of life in the London suburbs? Transport for London and its development partner Ballymore want to build 25 tower blocks in Edgware town centre, including a 29-storey skyscraper, which is completely unacceptable and inappropriate. We need a debate to make the point to the Mayor of London that he must demand that TfL withdraw from the project.
Penny Mordaunt
I thank my right hon. Friend for raising that issue. All communities want to ensure that new homes are built—that is very important—but we must ensure that they are the right type of homes and do not affect the character of an area, and that the needs of local people and their views are taken into account. I know my right hon. Friend has been campaigning hard on such matters, and that the development must be to a gentler density that is in keeping with the local character. I congratulate her and the Save Edgeware campaign, which is working flat out to ensure that the character of that community remains. I stand ready to assist her as she progresses that campaign.
Bell Ribeiro-Addy (Streatham) (Lab)
This week, on 9 March, it will be 10 years since the death of my dear friend, Adjuah Annan. She was just 28 years old. Adjuah had sickle cell anaemia, the UK’s fastest growing genetic condition, but her untimely death was the direct result of serious failings in her care. Her experience and those of many others are outlined in the landmark report by the Sickle Cell Society and the all-party parliamentary group on sickle cell and thalassaemia, “No One’s Listening”, published in 2021, but since then the Government have failed meaningfully to engage with its findings and recommendations. It cannot be right that 10 years after we lost Adjuah, those with sickle cell and thalassaemia continue to experience inequalities in treatment, substandard care and avoidable death. When can we expect the Government to finally listen and put forward policy that implements in full the recommendations of the “No One’s Listening” report?
Penny Mordaunt
I thank the hon. Lady for remembering her friend Adjuah, and allowing us to pause and pay tribute to her. I thank her also for raising the important work the APPG did on the matter. As the next Health questions will not be until late April, I will write on behalf of the hon. Lady to the Secretary of State for Health and Social Care and ask her to respond directly to her.
Mr Ian Liddell-Grainger (Bridgwater and West Somerset) (Con)
May we have a debate in Government time—it would be nice—to talk about Mid Devon District Council? I know I have talked about it before, but it has now gone beyond a joke. There are now no planning enforcement officers in Mid Devon District Council, as all the staff have gone. It is a free-for-all for developers. More importantly, the council have moved to waste collection every three weeks. That is not a problem, except the service has been taken over by a draconian “1984”-style group of councillors who are determined to make the lives of the people of Tiverton and mid-Devon impossible. The chair of scrutiny, who is incompetent and lazy, is doing nothing to scrutinise any of this. We cannot have local government being run by people who seem to be out to make the lives of local people miserable, so please may we have a debate on local government?
Penny Mordaunt
It is sometimes said that in response to questions I refer the hon. Member to the answer I gave some moments ago, but my hon. Friend could stand up every week and refer me to the question he asked the week before. He is assiduous in his campaigning to highlight the failures of his local authority, and I expect to see him doing exactly the same thing next week.
Wera Hobhouse (Bath) (LD)
Passengers must feel confident when making train journeys. In the last two weeks alone, there were major cancellations on South Western Railway, as well as mass delays on Southern and Thameslink. At the same time, rail fares rose by nearly 5% on Sunday. Everybody is paying more for less. Is it not high time we had a debate in Government time on how we can support our crumbling rail infrastructure?
Penny Mordaunt
The hon. Lady will know that the Department has made recent announcements on considerable uplifts to rail infrastructure. There have been particular issues with the service provided by South Western Railway and the quality of its rolling stock. The next Transport questions will not be for some time, so I will raise the hon. Lady’s concerns with the Secretary of State and ask that his officials get in touch with her.
Dr Matthew Offord (Hendon) (Con)
The Royal Air Force Museum in Colindale is one of London’s premier tourist attractions and many people use the tube to visit it. However, Transport for London and the Mayor of London have decided that the works to upgrade Colindale tube station necessitate a six-month closure. That is dire for commuters but also for visitors to the RAF Museum. Will a Minister come to the Dispatch Box to advise what assistance can be provided to mitigate yet more unintended consequences from decisions made by the disastrous Mayor?
Penny Mordaunt
I thank my hon. Friend for raising this important point. The Royal Air Force Museum is amazing; I was there recently at the RAF gallantry awards dinner. At most times, such work would be very unfortunate for one of our most impressive national museums, but anniversaries coming up this year will mean more people will want to visit the museum, particularly to see the reconnaissance aircraft. This matter is devolved to the Mayor of London, but I know my hon. Friend has done service by getting the concerns of many people on the record. I will ensure the relevant Department has heard his concerns, to see what pressure can be brought to bear on Transport for London and the Mayor of London.
Rushanara Ali (Bethnal Green and Bow) (Lab)
The Budget means net tax cuts of £9 billion taking effect in an election year, but that is dwarfed by the £27 billion of tax increases that took effect last year and the £19 billion of tax rises that will come into effect after the general election, because of the actions of her party. The Chancellor has given with one hand and taken with the other. Does the Leader of the House think that her party is fooling anyone?
Penny Mordaunt
I encourage the hon. Lady to re-read the Chancellor’s Budget speech to see what progress we are making on growth and inward investment into this country. This year, our investment summit had a record amount of money being put into this nation, with more than £30 billion garnered in just that week. She will know that yesterday we had revised forecasts on returning to our target for inflation. These are tough times, but the plan is working, and we are determined to see hard-working families through.
Bob Blackman (Harrow East) (Con)
Before the pandemic, Transport for London’s finances were in a complete mess, because the Labour Mayor of London refused to raise fares in line with inflation. Now, after receiving from the Government the final instalment of the £6.2 billion to cover the covid period, he freezes fares again, refuses to pay the police the money they need to reform and keep London safe, and raises the council tax precept by 8.7%. Will my right hon. Friend arrange time for a debate so that we can point out the errors of the London Mayor and put us on course for proper government in London?
Penny Mordaunt
I thank my hon. Friend for again raising the appalling maladministration of the Mayor of London. Londoners are paying more to prop up the Mayor’s budget, not just in the increased headline rates, but also in a whole series of stealth taxes and fines that are being levied. Even the most fundamental services in London, such as the police, have enormous black holes in their budgets. It is an absolute scandal, and I hope that Londoners will rectify that situation in the coming months.
Andy McDonald (Middlesbrough) (Ind)
The sorry saga of Teesworks continues, including the mysterious £20 million paid out to the joint venture partners over rubble. Putting to one side the bizarre hailing by the Secretary of State for Levelling Up, Housing and Communities of Lord Houchen as Teesside’s best champion since Sunderland won the FA cup in 1973—the Leader of the House might want to send him a map of the north- east—will she prevail upon him to come to the House and make a statement to explain how the £560 million of public money so far invested, which is providing eye-watering incomes for the joint venture partners without them putting in any money of their own, is in any way consistent with his claim that the remediation of the site was achieved by bringing in private investment? There has been no such private investment; the taxpayer has paid for the lot. Can she please ask the Secretary of State to come to the House and explain himself?
Penny Mordaunt
I dispute what the hon. Gentleman says, and I think it goes to the heart of his prejudices against private sector involvement. The proof of the pudding is in the eating, and the employment rate in Teesside is now 3% above the national average. I am sorry he does not welcome that success. We do, and we want it to continue.
Andrew Rosindell (Romford) (Con)
The Leader of the House will be fully aware that I welcome the Prime Minister’s remarks outside No. 10 Downing Street last week, when he said:
“It is not enough to live side-by-side, we must live together united by…a shared commitment to this country.”
He is right. Immigration is only successful when integration is successful. In the light of that, will the Leader of the House agree to a debate on the Floor of the House concerning a new proactive integration strategy, ensuring that those who come to Britain are encouraged to learn English, become part of UK communities and embrace British values? Does she agree that we need a coherent UK integration policy?
Penny Mordaunt
I thank my hon. Friend for raising that important point. The Home Office has done work in this area, and he will know that Departments have had initiatives, such as the Department for Levelling Up providing language classes and so forth. The Home Office has been focused on those who have leave to remain and choose to make their home here but are not citizens of this country, as well as looking at whether we need a more robust and proactive stance towards citizenship and all that it brings and means to us.
Ms Anum Qaisar (Airdrie and Shotts) (SNP)
My constituent John, despite having been born in North Lanarkshire and having lived in Scotland his whole life, had to apply to become a British citizen, pledge his allegiance to the King and pay £260 for the process to apply for a passport because he does not have access to his mother’s birth certificate. Will the Leader of the House make Government time available for MPs to raise and debate various passport issues? Is she aware of any recourse to allow my constituent to be reimbursed?
Penny Mordaunt
I am happy to facilitate a meeting between Home Office officials and the hon. Lady’s office —or indeed herself—to talk about that case and anything that the Department can learn from John’s experiences of going through that process. He will know that we have clear line-of-sight reporting on the costs charged for particular things, but if there has been some injustice, I am sure that meeting will help to rectify the situation.
Sir Robert Buckland (South Swindon) (Con)
Last week saw the launch of the independent report that I, together with the Department for Work and Pensions and the leading research charity Autistica, prepared as result of a 10-month review into autism and employment. There is still a huge gap in the number of people in work, with fewer than three in 10 adults who are autistic working, which is way below the disability average. I am grateful to the Backbench Business Committee for allocating time in April for a debate in this Chamber on the report and its findings. Will my right hon. Friend use her good offices to ensure that that time is preserved as much as possible, so that colleagues across the House can debate the report’s important recommendations?
Penny Mordaunt
I thank my right hon. and learned Friend for all the work he has done on the report and on many other areas of deep concern to people with autism and their families. It is a landmark report, and it is wonderful to hear that it will be debated on the Floor of the House. I will ensure that the time is protected and that nothing happens to it. I also congratulate my colleagues at the Department for Work and Pensions on the work they have done and the proactive way in which they commissioned these findings.
Dame Diana Johnson (Kingston upon Hull North) (Lab)
Yesterday, after the Budget, Kate Burt, the chief executive of the Haemophilia Society, said:
“Today, Chancellor Jeremy Hunt could have reassured those infected and affected by contaminated blood products that resources for long-overdue compensation would be made available. Instead, like so many Chancellors before him, he ignored this issue, deepening the anxiety, anger and frustration caused by his government’s failure to take responsibility for this long-running injustice. We deplore this cowardly and morally bankrupt attempt to kick the payment of compensation beyond the next general election.”
I know that the Leader of the House cares deeply about this issue and that she will be as disappointed as I am about the failure to put anything on it into the Budget.
Can we please have a statement from the Paymaster General about exactly what he is doing? He is not talking to those infected or affected, he is not taking soundings from any of the campaign groups, and he is appointing people to advise him but we are not allowed to know their names. It is time for a statement. It is time to know what the Government are actually doing.
Penny Mordaunt
I thank the right hon. Lady for raising that important point, and I am very happy to set the record straight. It is not the intention to kick the can down the road on this issue. The Paymaster General and I have a weekly update on it, and he is working very hard. The right hon. Lady will appreciate that, of all this process, this is the hardest bit—coming up with the scheme in short order and ensuring that it will deliver for those who are infected and affected. I do not think the House will have to wait long before it is updated by the Paymaster General. He is planning a tour across the UK to meet particular groups, and I hope he will be able to update the right hon. Lady on that very swiftly. This is a moral issue, and we have taken it seriously. That is why we did the inquiry. That is why we did the compensation review. The Paymaster General will have to balance the issues the right hon. Lady raises against being swift. He feels that very deeply, and he will deliver for the House and all the victims.
Sir Michael Ellis (Northampton North) (Con)
Tomorrow is International Women’s Day, and today marks five months since the barbaric Hamas attack on Israel. Of the 134 hostages still cruelly held by Hamas, 19 are women, and of those, five are teenage girls. Will my right hon. Friend join me in marking International Women’s Day by supporting the campaign called #BringBackOurGirls? Will she also take this opportunity to send a message to their families, who are enduring unimaginable pain and the living nightmare of these young women being in the hands of vicious rapist terrorists?
Penny Mordaunt
I thank my right hon. and learned Friend for affording the whole House the opportunity to send the message to all the hostage families that they are still very much in our thoughts. Of those women and girls still kept hostage, the youngest is 19 and the oldest is 70. We can only imagine the horrors they are facing. This week the UN published its report on the sexual violence suffered by Israeli women and girls on 7 October. It looked at over 5,000 photographs and over 50 hours of footage of those attacks, and it concluded that there was evidence at the Nova music festival of rape, gang rape and murder. It is the most appalling situation, and I am glad that the UN now has that evidence on record and has produced that report. We cannot let these poor women and girls suffer what they must be suffering a moment longer. We must bring them home, and I am sure that is the sentiment of everyone in the House.
Ashley Dalton (West Lancashire) (Lab)
Constituents in West Lancashire have this week been deeply concerned about the threatened closure of our dial-a-ride service. Yesterday, I learned that, unlike Conservative-led Lancashire County Council, Labour-led West Lancashire Borough Council has managed to find some additional funds for this year, and dial-a-ride has announced that it will be able to continue for the next financial year. Could we please have a debate about the impact of over a decade of cuts to local government on the valuable community and voluntary sector, which all our constituents rely on?
Penny Mordaunt
The voluntary and community sector is thriving, and 13 million Brits volunteer every single month. The services that the hon. Lady talks about are incredibly important. Different councils will be doing different things. Some have dial-a-ride services, and others have tokens for taxis, depending on whether they are urban or rural. This issue is incredibly important, and the hon. Lady will know that the Department for Culture, Media and Sport has put an enormous focus on supporting the community and voluntary sector through new initiatives such as the national citizenship programme. However, I will ensure that the relevant Department has heard her concerns.
Paul Howell (Sedgefield) (Con)
Further to the question from the right hon. Member for Kingston upon Hull North (Dame Diana Johnson), my constituent Dave Farry, from Ferryhill, is one of the many who have been impacted by the infected blood scandal. I understand that we are nearing the final compensation settlement for victims of this appalling scandal. Will the Leader of the House please advise me on how people can best engage with Ministers on this subject?
Penny Mordaunt
I thank my hon. Friend for raising this matter on behalf of his constituent. As I outlined earlier, the Paymaster General is keen not just to bring forward proposals in swift order, but to meet directly with those who have been infected and affected, in order to hear their views and get feedback on the scheme to ensure that it meets with their approval. My latest information is that there will be 25 meetings around the country. I know that the Paymaster General feels strongly that that is the right thing to do. I will make sure that he has heard my hon. Friend’s interest on behalf of his constituent and that my hon. Friend is updated as soon as those dates and venues can be announced.
Afzal Khan (Manchester, Gorton) (Lab)
Manchester has a proud history of welcoming those seeking sanctuary, but the Home Office is failing to provide support for the move-on process to those recently granted asylum. Since April 2023, there has been a 575% increase in the number of people who have presented to Manchester City Council as homeless because the Home Office has evicted them. The Government expect local authorities and the voluntary sector to fill the gap that they are leaving, but without providing the resources. Councillor Craig, the leader of Manchester City Council, has written to the Secretary of State to raise the issue. Can we have an urgent debate in Government time on the support offered to newly recognised refugees?
Penny Mordaunt
I would be very happy to raise this matter with the Home Office and ask for a meeting on behalf of the hon. Gentleman. Local authorities have a great deal of flexibility on who they take, under what circumstances and where they provide accommodation, so I am not quite sure what the underlying issue is. I would be very happy to facilitate a discussion between the hon. Gentleman and the Home Office.
Martin Vickers (Cleethorpes) (Con)
My right hon. Friend the Member for Gainsborough (Sir Edward Leigh), my hon. Friend the Member for Great Grimsby (Lia Nici) and I have a long-running campaign to restore the direct train service between Cleethorpes and King’s Cross, which would serve our three constituencies. We know that the Department for Transport has approved that. The Budget Red Book has a couple of sections that could include that service. Will the Leader of the House arrange for the Rail Minister to make a statement to clarify whether the Cleethorpes service is included?
Penny Mordaunt
I thank my hon. Friend for all his work on this important service for his constituents, which will bring massive benefits to the area. I can absolutely confirm that we are committed to ensuring that the service is stood up. I understand that work is still required to assess what infrastructure changes are needed at the stations involved and that further operational readiness activities need to take place before direct services can be introduced. I will ensure that the Rail Minister has heard what my hon. Friend has said today and that he contacts him to give him assurances.
Stephen Kinnock (Aberavon) (Lab)
It has been reported that taxpayers have had to pick up a £15,000 bill due to the actions of the right hon. Member for Chippenham (Michelle Donelan), who is rapidly becoming known as “the Member for Chipping In”. Could the Leader of the House confirm that amount of £15,000? Does she think it fair that taxpayers should be footing the bill for the disgracefully bad judgment and behaviour of her colleague?
Penny Mordaunt
As an experienced parliamentarian, the hon. Gentleman will know that each Department will have a permanent secretary and monitoring officer to ensure that any such payments are correct, proper and justified. The propriety and ethics team at the Cabinet Office also oversees such things. Not having been directly involved in the matter myself, I am pretty confident that what has happened is perfectly correct. What the hon. Gentleman is getting at is whether it is right. I point him to what that particular Secretary of State has done herself in other circumstances. She very much understands that taxpayers’ money is involved and has taken action in the past to turn down things that she was entitled to because she felt that it was morally wrong to take them.
Christine Jardine (Edinburgh West) (LD)
I hope the right hon. Lady knows that I am not a fan of the “go for the player rather than the ball” type of politics that is so popular with so many in this place, but following so many comments today, I have to say that, as public servants, we owe the public the right to question whatever we do. I fully respect what the right hon. Lady has said about the right hon. Member for Chippenham (Michelle Donelan) turning down payments, such as for her redundancy after two days as Education Secretary. However, the matter will not go away until the public have the right to ask questions.
There is also the issue of whether the ministerial code was breached in any of what has happened. The Prime Minister promised us a Government of transparency, so will the right hon. Lady please take back to him the suggestion that there should be a statement to the House to clarify the situation, if nothing else?
Penny Mordaunt
I completely understand the legitimate issues that the hon. Lady raises. She has a reputation for playing the ball and not the man or woman, and I take her question in the spirit in which I think it is intended. From what I know of the situation, and because of the oversight that is given to such matters, I believe that this issue has been dealt with in line with the rules. I refer her to what I have said about the character of the individual in question.
Marsha De Cordova (Battersea) (Lab)
Listening to the Chancellor’s Budget this week, people would think that everything is rosy, despite our country being in a recession. However, that narrative flies in the face of the daily reality of workers and businesses. Does the Leader of the House accept that the Government cannot escape from their dismal economic record over the last 14 years?
Penny Mordaunt
I would ask the hon. Lady to reflect on how she thinks the hard-working people of this country will cope with having to plug a £28 billion hole in Labour’s spending plans, which could only be raised—if the party is sticking to its fiscal rules—by raising taxes.
Patricia Gibson (North Ayrshire and Arran) (SNP)
Scotland’s baby box is delivered to every baby born in Scotland. It is packed full of baby essentials to be used from birth to six months, helping parents to give their child a positive start in life. Scotland also has the largest free book giveaway for children of any nation on Earth through the Bookbug book gifting programme, giving every child four free packs of books between birth and primary 1. We also have the Scottish child payment of £25 a week per child for our poorest families. None of those things is available anywhere else in the United Kingdom. Will the Leader of the House make a statement setting out her views on the importance of ensuring that every child has the best start in life, recognising that it is the Government’s job to address inequalities as much as they can, with the powers they have, to build a more cohesive and fairer society?
Penny Mordaunt
I have no quibble with any of the issues that the hon. Lady raises, but it is also the duty of Governments to ensure that people have public services they can rely on, that the police can attend burglaries and other such things, that people have access to the healthcare they need, and that their ambitions with regard to the growth of the economy and their local communities are supported. Unfortunately, her Government in Scotland are not doing those things.
Andrew Western (Stretford and Urmston) (Lab)
My constituent Michelle is a cancer survivor who has campaigned for years on access to NHS dentistry for cancer patients. I have made frequent attempts to secure a debate on this matter and will continue to do so, but will the Leader of the House allocate some Government time to discuss this important issue, given the traumatic impact chemotherapy can have on one’s dental health and the incredibly significant impact that has on the lives of those who are able to survive cancer?
Penny Mordaunt
I know that my right hon. Friend the Member for South Northamptonshire (Dame Andrea Leadsom), who is the Minister with responsibility for dentistry, has brought forward a new dental plan, which includes an uplift but also new things for the NHS in England, such as mobile dentistry vans. She is particularly focused on people who are disproportionately affected because of other issues, including cancer patients, looked-after children, and women who were pregnant during the pandemic and could not access free dental care at the time. We have new opportunities with the new dental plan to ensure that everyone in our nation is dentally fit, including through changes to how payments are made. I think that a debate on this matter would be very welcome, and I know that the hon. Gentleman knows how to apply for one.
Andrew Bridgen (North West Leicestershire) (Ind)
Public petition 648609 called for a debate on ending the UK’s membership of the World Health Organisation, but a debate was refused by the Petitions Committee despite the petition well exceeding the 100,000 signature threshold. Can we please have a statement on why this House is determined to give away sovereign powers to an unelected, unaccountable, non-tax paying, diplomatically immune organisation whose current director general was appointed only through an unholy alliance of Bill Gates and the Chinese Communist party? Can the Leader of the House say why the WHO has joined excess deaths and vaccine harms on the list of things that we just cannot talk about in this House?
Penny Mordaunt
I think there are enough health-related issues, and all sorts of other issues, to worry about, focus on and debate without inventing crisis and drama where there is none. The hon. Gentleman acknowledges that petitions are a matter for the Petitions Committee, which is a Committee of this House. I am not responsible for its decisions. I will facilitate and help him to secure debates and raise questions, and to do anything else he wants to do, on any topic on which he wishes to campaign.
The hon. Gentleman will know, because he has secured well-attended debates in the past, that this House is very open to discussing all sorts of issues, including the World Health Organisation and the treaty about which I know he is concerned. Let us focus on the real issues, the substance and the matters at hand, rather than pretending that this House, anyone in it or any of its Committees has a hidden agenda, because he knows that is not true.
Mr Barry Sheerman (Huddersfield) (Lab/Co-op)
Does the Leader of the House agree that this is probably the most perilous time for the world during my long time in the House of Commons? Does she also agree that this House needs to be up to date on what is happening in the world? Last week, I had to watch the Foreign Secretary appear before the House of Lords on television to be informed of our foreign policy and what he is doing. I understand that no Conservative Member of Parliament seemed fit to be Foreign Secretary and that we had to go to the House of Lords, but can we have more regular debates and statements? It is not right for the elected House of Commons to have no Secretary of State to answer questions during these perilous times.
Penny Mordaunt
I implore the hon. Gentleman to recognise the merits of the Minister of State, Foreign, Commonwealth and Development Office, my right hon. Friend the Member for Sutton Coldfield (Mr Mitchell), who has appeared at this Dispatch Box an enormous number of times, and to acknowledge that the Foreign Secretary, who obviously sits in the House of Lords, has made himself available to hon. Members on a raft of issues. He has particularly made himself available to those Members who have been affected by what is happening in Israel and Gaza.
The hon. Gentleman will know that the Procedure Committee has made further recommendations on how this House can scrutinise the Foreign Secretary, and I am sure the House of Lords will shortly take a decision on those recommendations.
Ruth Cadbury (Brentford and Isleworth) (Lab)
Despite yesterday’s short-term tax cuts, families across the country know that they are worse off than they were 14 years ago, so will the Leader of the House urge the Prime Minister to call an election and let the British people give their views on this Government?
Penny Mordaunt
I am afraid that what the hon. Lady says is not the case. We have got an enormous number of people into work, and the best way for people to lift themselves out of poverty is through work. Two million of those 4 million people are women, and 1 million are disabled people who would not have had the dignity of a pay packet without our welfare reforms to make work pay and to support people in work.
We have an enormous childcare package that the previous Labour Administration went nowhere near. The number of pensioners living in absolute poverty has reduced by 200,000, and the number of children living in absolute poverty has reduced by 400,000. By any measure, the country is doing better. It will have more opportunities in future because of what we have done in education. We are soaring up the international literacy tables, and we have reformed post-16 education to enable people to get a degree without getting into massive amounts of debt, as happened under the hon. Lady’s party. What she says is not true, which is why we need to stay the course and stick with this Government.
Kevin Brennan (Cardiff West) (Lab)
Last week, I talked about my constituent Sue Sparkes, whose husband died as a result of the infected blood scandal. I know that the Leader of the House has a copy of the Red Book with her, as she mentioned that earlier. Can she point to the line in it that shows where the Chancellor has set aside any resource to deal with the compensation that she and he know will have to be paid as a result of this scandal? Is this not a moral obligation on the Chancellor to this House, to my constituent and to all those affected by this scandal?
Penny Mordaunt
The hon. Gentleman will know that provision has been made for this, and the final scheme is being worked on. I can understand why people want to raise this issue; it is a moral issue and it stirs understandable passions. However, I just caution hon. Members to recognise—I believe they know this—that the scheme is about to be brought forward. I have already announced today that the Paymaster General will be going around the country to talk to people directly about that and the plans he is bringing forward. I care passionately about this issue, as I did when I gave evidence to the inquiry, and I do not want victims of this appalling scandal to worry about what is going to happen. I want us to be able to reassure them, so I hope I will be able to continue to do that every week. I ask hon. Members, who rightly want to know the detail of the scheme, to reflect that in the questions they ask both me and the Paymaster General.
Jim McMahon (Oldham West and Royton) (Lab/Co-op)
Will the Leader of the House join me in congratulating Oldham Athletic football club owner Frank Rothwell on his sterling achievement in rowing the 3,000 miles across the Atlantic, in aid of Alzheimer’s Research UK, in his 70s for the second time? He managed to raise more than £350,000 for that charity, adding to the £1 million he raised previously on the first row. Will she also allocate Government time for a debate on the real issue of the near 1 million people affected by Alzheimer’s in the UK, and the funding and early diagnosis that supports work in that area ?
Penny Mordaunt
As the hon. Gentleman asked that question and revealed the full extent of his constituent’s incredible achievement, there was an audible gasp, so I am sure the whole House will want to join him in congratulating his constituent on those amazing achievements. I am close to HMS Oardacious, the Royal Navy’s rowing team, which regularly rows the Atlantic, so I am very familiar with the incredible ordeal that that is. Doing it at 70 years old is utterly remarkable, and I congratulate Frank deeply. I also thank the hon. Gentleman for raising his concerns about provision and care for those suffering from Alzheimer’s. I shall make sure that the Health Secretary has heard what he has said.
Kirsten Oswald (East Renfrewshire) (SNP)
I welcomed the Chancellor’s announcement that he would be taxing vaping products, but I wonder why on earth this has to be left until 2026. It is disappointing that in the same week that Laura Young, also known as Less Waste Laura, was named as Scottish influencer of the year for her fantastic environmental campaigning, including on banning disposable vapes, this important tax measure has been so resoundingly kicked into the long grass. I am sure that the House would want to join me in congratulating Laura, but may we also have a debate in Government time on the imperative of moving with more speed on taxing vapes? Perhaps we will also be able to make time to discuss the wholly unacceptable practice of vaping companies sponsoring sports strips.
Penny Mordaunt
I thank the hon. Lady for getting her concerns on the record. I will raise that matter with both the Treasury and the Health Secretary. The hon. Lady will also know that we are also hoping to bring forward legislation shortly, which I am sure, given what she said, she would be happy to support.
Alex Cunningham (Stockton North) (Lab)
My hon. Friend the Member for Middlesbrough (Andy McDonald) referred earlier to the gaffe by the Secretary of State for Levelling Up, Housing and Communities, who demonstrated his ignorance while on a visit to Teesside, referring to the “heroes of Sunderland” who won the FA cup in 1973, when perhaps he should have been praising the 2004 League cup winners, Middlesbrough. Instead of ignoring the matter, can the Leader of the House arrange a humanities lesson for the Minister, so that he can better understand the history and geography of the north-east?
Penny Mordaunt
I take my responsibilities to all Members of this House very seriously. Immediately after this session I will go and raise with the Secretary of State, his special advisers and his officials what the hon. Gentleman has said. I think that we can take from that—given all the other issues that he might have raised in his question to me this morning—that he thinks the Government are doing a very good job.
Justin Madders (Ellesmere Port and Neston) (Lab)
Can we have debate on personal responsibility? If I say or tweet something defamatory, I would expect to be responsible for the consequences of that, not the taxpayer, and I think that is what the public would expect as well. The Leader of the House’s response to an earlier question suggested that, somehow, the right hon. Member for Chippenham (Michelle Donelan) had credit in the bank because she did not take the redundancy payment that was offered to her, or that these payments are within the rules. If that is the case, the rules are wrong, which is why we need a debate.
Penny Mordaunt
The hon. Gentleman has hit on it: if the rules have been followed and if we are not questioning the character of the individuals, it must be that the rules are wrong. I will raise this with the Department and the permanent secretary. However, I can reassure the House again that these matters have considerable oversight both from the monitoring officers in the Departments and from the propriety and ethics team.
Christian Wakeford (Bury South) (Lab)
This week, 4 March marked the one- year anniversary of Anu Abraham’s death. Anu was a young man with a bright future and he should still be here. After speaking to his family and seeing photos of him, I can say that he was one of the kindest individuals that anyone could know and that he had a smile that would light up a room. Anu tragically took his own life following bullying while working as a trainee police officer with West Yorkshire police. Can we have a debate in Government time on police recruitment, the training of police officers and the support packages that are available? Lessons must be learned, changes must be enacted and voices must be heard.
Penny Mordaunt
I thank the hon. Gentleman for allowing us to remember Anu and to get that on the record. Clearly, Anu was somebody who wanted to step up to public service and serve his community. His suicide is an absolute tragedy. I know that police services in general, and in particular those responsible for training and ensuring that the right safeguarding support is there for those going through training, review these matters. I know, too, that the Home Secretary takes these matters very seriously. I will tell him that the hon. Gentleman has raised this today and ask that he is updated on progress to help ensure that this tragedy never happens again.
Gerald Jones (Merthyr Tydfil and Rhymney) (Lab)
I have been trying to amend the Road Traffic Act 1988 following the tragic loss of a one-year-old child, Pearl Black, from Merthyr Tydfil. Working with Pearl’s parents, I have produced an amendment that seeks to close a loophole that caused them such huge distress. In November, the Prime Minister gave a commitment at Prime Minister’s questions to facilitate a meeting with the relevant Minister, possibly from Transport or Justice, for Pearl’s parents. Unfortunately, despite requests, that meeting still has not taken place. Can I ask the Leader of the House to please offer her assistance in securing a debate on how we can deliver the change and, crucially, how we can facilitate a meeting with Pearl’s parents?
Penny Mordaunt
I am sorry to hear that that meeting has not happened. I am sure that Transport Ministers would want to facilitate it, so, following this session, I will make sure that they have heard what the hon. Gentleman has said and see whether we can rectify that.
Matt Western (Warwick and Leamington) (Lab)
Tomorrow is International Women’s Day. It saddens me greatly that Warwickshire should have the worst conviction record for rape and serious sexual offences. Philip Seccombe, our police and crime commissioner, was one of the few to cut domestic abuse units and closed the rape and serious sexual offences unit in Warwickshire. Can we have a debate in Government time on the accountability and scrutiny of police and crime commissioners?
Penny Mordaunt
The hon. Gentleman raises some very serious matters. I refer him in particular to what the Prime Minister said at Prime Minister’s questions this week about the progress that has made on supporting victims of these heinous crimes in coming forward, and the increased conviction rate that we want to see, particularly for rape and sexual assault. I think a debate on these matters would be excellent, because there is considerable variation between areas, and in what police and crime commissioners are doing. I would welcome that scrutiny.
Alistair Strathern (Mid Bedfordshire) (Lab)
On Monday, I was out in Meppershall, where residents are fed up with the condition of the main road through the village. As is the case in many villages, residents have been told that the much-needed roadworks cannot take place until developments are finished. As reasonable as that may sound, developments drag on and on, and with no end to future developments in sight, surely enough is enough. Will the relevant Minister issue a statement on whether more guidance might be needed about the length of time it is reasonable for private developments to delay clearly needed public roadworks?
Penny Mordaunt
I will certainly ensure that the relevant Departments have heard the hon. Gentleman’s concerns. He will know that local authorities have been given a sizeable uplift in road maintenance grants, particularly for such things as potholes and resurfacing. On the 15th of this month, local authorities have to publish what they have done with that money. I encourage him to scrutinise whether that money has been spent, and spent on the right things.
Richard Foord (Tiverton and Honiton) (LD)
At the end of January, the Government launched the Pharmacy First scheme, which encourages patients to consult pharmacists rather than GPs, or at least to take pressure off GPs. While that is good in theory, the reality is that the community pharmacy workforce are on their knees, with levels of trained support staff having been cut by 20%. We are seeing the closure of pharmacies in rural and coastal towns such as Axminster and Sidmouth, with a constituent telling me yesterday that queues at the pharmacy in Axminster are out the door. Will the Government please make time for a debate on recognising the value of community pharmacies?
Penny Mordaunt
The Government do recognise the value of community pharmacies. There can be no Prime Minister better placed to recognise the importance of pharmacy. That is why we have not only enabled the Pharmacy First service to be stood up, but worked on it for a number of years. It is now available to all members of the public, but there were trailblazer programmes prior to that for people who were on benefits. Some 98% of pharmacies are now making use of the scheme, which also enables them to derive an income from it. That is progress to be supported and welcomed. I hope that the hon. Gentleman will promote the scheme in his constituency.
Point of Order
(2 months ago)
Commons ChamberRead Full debate Read Hansard Text Watch Debate
Lilian Greenwood (Nottingham South) (Lab)
On a point of order, Madam Deputy Speaker. It has been drawn to my attention that on Monday the hon. Member for Mansfield (Ben Bradley) publicised his meeting with the leader of the Nottingham Independents, which clearly took place in Old Market Square in my constituency. The hon. Member had not notified me that he would be visiting Nottingham South. We all make genuine mistakes; however, when I looked at his social media feed I became aware that this is the fourth public visit that he has undertaken in my constituency since the beginning of February, none of which he notified me of. I appreciate that he already has two jobs and is seeking a third, but I would be grateful for your advice on how he might be prevailed upon to follow the rules of behaviour and courtesies that apply to us in our jobs as Members of this House.
Madam Deputy Speaker (Dame Rosie Winterton)
I am grateful to the hon. Lady for her point of order and for giving me notice of it. I assume that she informed the hon. Member that she intended to raise this.
Madam Deputy Speaker
This is an incredibly serious matter. Mr Speaker reminded the House on 22 January that when a Member intends to visit another constituency other than in a private capacity, they should make every reasonable effort to inform the Member representing that constituency before they do so. That applies in particular to public events and meetings. In addition, hon. Members have a duty to look after the constituents who elected them to this place. Boundary changes do not take effect until the next election, and we must observe the convention of not involving ourselves in another Member’s constituency until that time. I have had similar experiences, and I know how annoying it is. It is also something that all parts of the House need to observe. We have the Leader of the House present—I know it is not strictly in her remit, but I am sure that she will take back the views expressed, as will the Whips. I emphasise: everyone has to stick to that, particularly this year, because things can get very fraught and difficult. I think we will leave it at that.
Bill presented
Ways and Means
Budget Resolutions
(2 months ago)
Commons ChamberRead Full debate Read Hansard Text Read Debate Ministerial Extracts
Madam Deputy Speaker (Dame Rosie Winterton)
I call the shadow Chancellor of the Exchequer.
Rachel Reeves (Leeds West) (Lab)
The stark reality of yesterday’s Budget is clear: taxes rising, living standards falling, growth stalling, and yet again the Tories making promises that they cannot deliver. They have failed on the economy, they are out of ideas and they are out of time.
Let me turn first to the most, and potentially only, remarkable bit of the Budget statement yesterday. After an hour and 10 minutes, the Chancellor of the Exchequer seemed to float an idea of getting rid of national insurance altogether. I was not quite sure what I had heard, but then Ministers started touring the TV and radio stations to say that that indeed was their intention. In what seems to have been a casual afterthought, the Chancellor has made a £46 billion unfunded commitment, leaving a gaping hole in the public finances, even bigger than the unfunded tax cuts announced in the Tory kamikaze mini-Budget just 18 months ago.
Let me ask the Secretary of State for Work and Pensions this: how does the Chancellor plan to pay for the £46 billion tax pledge made yesterday? To be more precise, what is the Chancellor’s assessment of the impact that £46 billion of tax cuts would have on borrowing, tax rises elsewhere or public spending, or has he simply managed to find the same magic money tree that his predecessor was so fond of? This is an omnishambles Budget from a desperate Tory party. Instead of recklessness, Labour will take a different approach: as Chancellor, I will never make a commitment without saying where the money will come from. That is the responsible approach.
Let us turn now to the other tax cuts that the Chancellor announced yesterday. Two years ago, when the current Prime Minister wanted to increase national insurance, we opposed it. Since then, I have consistently said that I want taxes on working people to be lower and so, just as we supported the last cut to national insurance, we support the measures announced in the Chamber yesterday to bring it down by a further 2p.
Let us be clear, however: the measures come in the context of a rising tax burden, the highest it has been in 70 years, and the tax burden is rising in each and every year of the forecast period. For every £10 that the Government are taking from families in higher tax under their plans, they are only giving £5 back. They are giving with one hand and taking twice as much with the other, and they expect people to be grateful.
Rushanara Ali (Bethnal Green and Bow) (Lab)
Does my right hon. Friend agree that the Prime Minister’s tax plans will leave households on average £870 worse off under the Conservatives?
Rachel Reeves
My hon. Friend has done the maths and is absolutely right. Taking into account the changes to the tax threshold, the announcements yesterday and in November, and council tax, by the end of the forecast period the average family will be £870 worse off.
As the Resolution Foundation highlighted just this morning, the 8 million tax-paying pensioners will see their taxes increase by an average of £1,000. That is a collective £8 billion tax grab from our nation’s pensioners. As Paul Johnson, the director of the Institute for Fiscal Studies, said yesterday:
“This remains a parliament of record tax rises.”
That is the legacy of this Conservative Government.
The Tory Government’s pickpocketing has meant higher taxes on working people, leaving them with less money at a time when their daily lives are getting more expensive. Yesterday, the Chancellor said that a person on average earnings is £900 better off, but let us take a look at that claim. He has ignored not only his own stealth tax rises, with the tax thresholds and council tax, but the rising costs of energy bills, food, mortgages and rent. In fact, rather than being better off, as he claimed, household disposable income is set to fall by £200 per person over the course of this Parliament.
Peter Grant (Glenrothes) (SNP)
I completely agree that deliberately leaving tax thresholds untouched at a time when pay and prices are increasing is a stealth tax. It is a stealth tax when this Chancellor does it, but it was also a stealth tax when Gordon Brown did it.
Rachel Reeves
It is interesting to have an intervention from the SNP, which is increasing taxes on ordinary working people—I would probably just stay on the Bench.
This is the only Parliament on record in which living standards are set to be lower at its end than at its beginning. The Chancellor chose to ignore all those realities, but the truth is that ordinary families cannot ignore them. As people up and down the country know, the definition of being better off is having more money. Under the Tories, people have less. People feel worse off because they are worse off.
Let us look at economic growth. Growth is critical for our success as a nation, for our living standards and for provide sustainable funding for public services, but the Tories have failed there, too. The context of yesterday’s Budget is a Prime Minister who pledged growth but has delivered recession. This economy is now smaller than when the Prime Minister took up office. Instead of bouncing back, the UK’s GDP is bumping along the bottom this year.
In his statement, the Chancellor rightly elevated the true measure of success:
“not just higher GDP, but higher GDP per head.”—[Official Report, 6 March 2024; Vol. 746, c. 837.]
I agree with him that that is the most important yardstick, so how are the Tories doing against that measure? The reality is that GDP per capita is set to shrink, not grow, this year, having shrunk and not grown last year, too. GDP per capita is now expected to be lower at the end of this year than it was at the start of this Parliament. Yesterday, we learned that forecast GDP-per-capita growth has been revised down for four of the next five years—hardly the success that the Chancellor was looking for.
The Chancellor said that it was important not to follow a path that relied on net migration to provide growth and GDP, and I agree. Has the Secretary of State for Work and Pensions seen the chart on page 29 of the Office for Budget Responsibility economic and fiscal outlook, which shows that net migration has been revised up by 350,000 over the next five years? That is the exact opposite of what the Chancellor spoke about.
Our country has gone through a difficult time over these past few years. The origins of many of the crises we have faced are global: pandemic, war, and the energy crisis. Other countries have also experienced those shocks, but each time crisis has hit, Britain has found itself acutely exposed because of the choices of successive Conservative Governments: austerity that choked off investment, then Brexit without a plan, and then the Tories crashed the economy with their kamikaze Budget.
This Tory record of economic failure has held our country back for far too long. If the UK economy had grown at the average of the OECD rate since 2010, when the Conservatives came to office, it would now be £140 billion bigger than it is today. That is equivalent to £5,000 per household every year, and would mean an additional £50 billion in tax revenues to invest in our public services. Growth matters, but the Tories are incapable of delivering it. [Interruption.] The hon. Member for Newcastle-under-Lyme (Aaron Bell) says from a sedentary position that we are doing better than the G7. There are only two G7 countries in recession today: us and Japan. That is the Conservatives’ record, and they should be ashamed of it.
This is the 12th Tory plan for growth in 14 years, and we are still in recession. Twelve plans from five Prime Ministers and seven Chancellors, with none of them succeeding. We are trapped in a Tory doom loop of low growth and high taxes, and it is working people who are paying the price.
Richard Graham (Gloucester) (Con)
I am struggling a bit with the right hon. Lady’s figures. My own calculations suggest that this year, pensioners will see an increase of £900 from an 8.2% increase in the state pension as a result of the triple lock. In all, I think, pensioners will be getting £3,700 more than they were in 2010. That is a huge increase in their income, alongside all the help with the cost of living and winter fuel, yet the right hon. Lady was saying earlier that pensioners are going to be worse off. I do not follow her maths; can she help?
Rachel Reeves
Those numbers about pensioners who pay tax are from the Resolution Foundation. They were published this morning, so the hon. Gentleman can also look at them, but it is a fact that because the tax thresholds have been frozen, pensioners who pay tax are paying more tax than they were before. That is the legacy of this Government. This is not just about lines on a graph. It is about our high streets, it is about whether businesses grow, and it is about whether we can create secure, well-paid jobs in all parts of the country, with more money in the pockets of working people, because if an economy does not work for working people, it does not work at all.
When the Tories are not pickpocketing the taxpayer, they are pickpocketing Labour policies. Having spent years defending the indefensible, the Tories have belatedly listened to Labour and recognised the importance of closing the non-dom tax loophole. I believe that if people make Britain their home, they should pay their taxes here too. The Office for Budget Responsibility says that the steady state amount of revenue raised by the non-dom policy is £3 billion per year. I first called for that loophole to be closed when it entered the public consciousness two years ago that some people were not paying their fair share of taxes, meaning that we have missed out of £6 billion in tax revenue—money that could have been invested in our public services.
If any further proof were needed that Labour is winning the battle of ideas, it is our time-limited windfall tax on the oil and gas producers. Having originally opposed the creation of such a tax, the Tories were dragged kicking and screaming by Labour to create an energy profits levy. Even after yesterday’s announcement of a one-year extension, the Tories are still leaving gaping loopholes, meaning that many energy giants will still pay less in tax. Meanwhile, the SNP opposes our proper windfall tax while, just three weeks ago, it put up taxes on working people in Scotland—on teachers, nurses, and plumbers.
Rachel Reeves
I will happily take another intervention, if the hon. Gentleman wants to defend higher taxes on working people. Bring it on!
Peter Grant
Does the shadow Chancellor not understand that the SNP’s position is that there should not be a single windfall tax that punishes only north-east Scotland? A windfall tax should be applied to every sector that has profiteered from war, covid and price increases. Does she not understand that the SNP’s income tax policy means that low-paid workers—the people the Labour party is supposed to protect—pay less income tax in Scotland than they would in England, and that nurses and care workers are paid more in Scotland than in England? That is true, is it not?
Rachel Reeves
All I would say to the hon. Gentleman is: put that on your leaflet! The fact is that nurses, teachers and plumbers are paying more tax in Scotland. At the same time, the energy giants that are making huge profits from the windfalls of war will pay less tax under the SNP. That is its record, and it should be ashamed of it.
Labour is committed to investing more in our schools and hospitals. That was a priority before the Budget, and it remains a priority, because public services are on their knees after 14 years of Conservative failure. Labour believes in aspiration for all our children, and we will not stand by while the roof falls in on state education under the Tories. History is repeating itself: children are again being taught in portacabins, as they were when I was at school under a Tory Government. When the Tories undervalue our young people, they are squandering their potential and undermining our whole country’s future. That is why the next Labour Government will close the tax loopholes enjoyed by private schools. The money raised from ending their exemption from business rates and VAT will instead go where it is needed—to help the 93% of children in our state schools.
I will always be clear that all the policies in our manifesto will be fully costed and fully funded. Now that the Tories have U-turned on their policy on non-doms, which we welcome, we will do the necessary work to show how our plans will be paid for. We will set that out in an orderly and responsible way. Our public services are in a mess under the Conservatives, but a Labour Government will begin to turn them around, give an immediate injection of cash to our schools and our hospitals, and tackle Tory waste, through a serious plan to grow our economy and provide the sustainable finance that our public services need.
It takes some nerve for the Chancellor to wag his finger at local councils this week, when the Tories and the Prime Minister have squandered billions of pounds of taxpayers’ hard-earned money. Who has used excessive numbers of management consultants in central Government? The Tories. Who signed the cheques and lost an additional £10 billion through dodgy personal protective equipment contracts? The Tories. Who left the vaults open, so that organised criminal gangs could help themselves to £7 billion of public money through covid fraud? The Tories. Who made a costly mess of HS2? The Tories. Who handed £500 million to the Rwanda Government, and has nothing to show for it? The Tories.
Chi Onwurah (Newcastle upon Tyne Central) (Lab)
Will my right hon. Friend give way?
Chi Onwurah
My right hon. Friend is absolutely right, because every area of Conservative spending has a dimension of waste or profligacy. Does she agree that the £15,000 of taxpayers’ money spent on settling the attack made by the Secretary of State for Science, Innovation and Technology on a British scientist—an entirely unfounded and defamatory attack—would have been so much better spent supporting British scientists to drive British economic growth?
Rachel Reeves
I think taxpayers will find it pretty grating to see their tax bill go up, when that money was spent so callously and casually. Meanwhile, the Chancellor failed to do the right thing yesterday, when he did not set out in the Budget compensation for those affected by the infected blood scandal or for wrongly accused sub-postmasters. That is an abdication of responsibility, and a betrayal of all those who have fought for justice for so many years, and it will not be forgiven.
I am under no illusion about the scale of the challenge that we may inherit, or the scale of the task of rebuilding our economy and country. Labour’s economic plan will take Britain from instability and short-termism to a mission-based Government, prioritising economic growth and security for families and our country—a Government built on the pillars of stability, investment and reform. Stability is brought about by iron discipline, guided by strong fiscal rules and robust economic institutions. Investment is brought about by working with the private sector, so that we can lead the industries of the future through a modern industrial strategy. A new national wealth fund will invest, alongside business, in our automotive sector, renewables-ready ports and the future of our steel industry. Reform starts with our planning system; we will take on vested interests to get Britain building again, support working people in developing the skills that they need to thrive in the changing world of work, and make work pay with a genuine living wage and a new deal for working people. Our economy needs change. Britain needs change.
The verdict on the Budget is in. There is no long-term plan for growth, and leading business organisations agree. The Institute of Directors said that the Budget
“fell short of delivering a comprehensive plan for sustainable growth.”
The British Retail Consortium said:
“the Chancellor has done little to promote growth and investment”.
The Trades Union Congress has highlighted that real pay is still below where it was in 2008. Whichever way we look at it, the Tories have failed on the economy. The damage is done. Nothing this week will compensate for the fact that people are worse off under the Tories. Taking £10 and handing back £5 is a swindle, not a giveaway. Working people pay more, pensioners pay more and homeowners continue to pay more. Reckless and desperate promises are repeated.
The lesson from the Budget is simple: the Conservatives cannot be trusted with the economy. The questions that people ask ahead of the next election are simple: are my family and I better off after 14 years of Conservative Government? Do our schools, hospitals, police and transport work better than when the Conservatives came to office 14 years ago? Frankly, does anything in our country work better than when the Conservatives came to power? The answer is a resounding no. If the Tories had any confidence in their plans and their record, they would name the date of the general election. It is time for the British people to give their verdict on 14 years of Tory failure. Only Labour can provide the change that our country so desperately needs.
Several hon. Members rose—
Madam Deputy Speaker (Dame Rosie Winterton)
Order. Before I call the Secretary of State, I remind Members that if they intervene on another Member, it is important to wait until the end of their speech before leaving the Chamber. It is discourteous to leave before the speech has finished. That is just a reminder. I am sure that everyone will follow that rule. I call the Secretary of State.
The Secretary of State for Work and Pensions (Mel Stride)
Thank you, Madam Deputy Speaker. The right hon. Lady commenced her remarks by saying much about where Labour is on tax. She criticised the aspiration that the Government rightly have to abolish national insurance at some point in the future. She rather disingenuously repositioned that as a firm commitment, rather than an aspiration, but let us set that to one side.
The right hon. Lady knows all about firm commitments, because we had a firm commitment from her to £28 billion- worth of spending every year over the forecast period. That did not survive contact with reality. Indeed, she has little to say that is original. When she writes about economics, she has to cut and paste from Wikipedia. When she trumpeted her ruinous £28 billion spending plan, she ultimately had to U-turn and run for the hills. For this shadow Chancellor, when it is not cut and paste, it is cut and run. [Interruption.] I thought the right hon. Lady would like that.
The right hon. Lady has also accepted our tax measures as set out in yesterday’s Budget, including the abolition of non-dom status and the windfall tax on oil and gas. She has hypothecated the money raised from those two measures many times over—for the NHS, dentistry, breakfast clubs and so on. Now that she has accepted all the tax measures in the Budget, I invite her to come back to the Dispatch Box; I will give way to her if she will let us know whether she will U-turn again on her spending commitments on the NHS and dentistry, or whether she will put up taxes and borrowing. I would be very happy to hear from her—all right, perhaps not.
Rushanara Ali
When the Secretary of State was Chair of the Treasury Committee, he was keen on Office for Budget Responsibility assessments and forecasts. Indeed, he argued for them, but his then Prime Minister and Chancellor failed to listen to him and crashed the economy. He and his Government want to pursue the aspiration, as he now calls it, of scrapping national insurance contributions altogether, which would cost £48 billion a year. Will he commit to seeking an OBR forecast and assessment of that, and showing how the Government would pay for that?
Mel Stride
Let me talk about the general point that the right hon. Member for Leeds West (Rachel Reeves) made about the tax burden. It is as if history has been erased from her mind. The fact is that the covid pandemic shrank the economy overnight by 10%, and this Government stepped in, supported jobs, and saved 10 million jobs as a result of the intervention that we came forward with. It is as if it has been erased from her memory that a war is going on between Russia and Ukraine, and that that has led to an increase in energy prices and inflation. This Government have stepped in to support the most vulnerable in society, including families, pensioners, and the disabled up and down this country. The Government provided £400 billion of support across that period, and in all candour, I do not believe that there was a single occasion on which she opposed any of our interventions. She was up for spending the money to support people, but not up for recognising that it has to be repaid. That is why the tax burden is indeed increasing.
To go back to the point about the OBR’s economic and fiscal outlook raised by the hon. Member for Bethnal Green and Bow (Rushanara Ali), the OBR makes it clear that the measures taken yesterday in the Budget mean that the tax burden will be lower than was forecast in the autumn, as a result of the management of the economy and the reduction in taxes that my right hon. Friend the Chancellor brought forward.
Lilian Greenwood (Nottingham South) (Lab)
The Secretary of State might not be surprised that Labour Members take it a little unkindly when he suggests that we are forgetting the past, when he seems to have forgotten the immediate past, and the state that the former Prime Minister left the British economy in just a year ago. How much extra debt interest will the Government pay as a result of the Chancellor’s unfunded commitment to abolish national insurance contributions, at a cost of £46 billion?
Mel Stride
It is an entirely disingenuous statement to say that there is any such unfunded commitment. The only unfunded commitment in recent times is the £28 billion that the Labour party came forward with; the Leader of the Opposition called it something along the lines of “absolutely critical”, only for the shadow Chancellor to U-turn on it not long afterwards.
Let me turn to the comments that the right hon. Member for Leeds West made about pensioners. She neglects to point out that we have stood by the triple lock. Since 2010, there have been 200,000 fewer pensioners in absolute poverty after housing costs. That is a result of this Government making the protection of our pensioners a key priority over many years. Among many things that have been erased from her memory, she has forgotten that on her watch, when Gordon Brown was Chancellor, there was the 75p increase in pensions.
Michael Shanks (Rutherglen and Hamilton West) (Lab)
This morning the Chancellor appeared to suggest that income tax and national insurance contributions will be merged as part of his commitment yesterday. As national insurance is not currently levied on some forms of income, will the Secretary of State confirm to the House how much extra tax pensioners will pay as a result of the Chancellor’s policy decisions?
Mel Stride
There is no immediate Government approach to merging income tax and national insurance, and I rather put that in the category of those comments about the apparent commitment of £46 billion, although I think the hon. Member for Bethnal Green and Bow nudged it up in a typical Labour way to £48 billion a moment ago.
Let me turn to the remarks that the right hon. Member for Leeds West made about growth. As she knows, we have had a technical recession of two quarters of negative growth—one of which was the princely amount of 0.1%—and most of the purchasing managers index data makes it clear that the economy is on a very different path. Indeed, to return to the comments of the hon. Member for Bethnal Green and Bow, the OBR makes it clear that over the period of the forecast, there will be reasonable and decent growth—greater than that of France, Italy and Germany. That is on the back of exactly the kind of growth record that this Government have had since 2010.
Sir Stephen Timms (East Ham) (Lab)
On growth, it was the former Prime Minister, when seeking election as leader of her party, who characterised the growth record since 2010 as lamentable. She was surely absolutely right about that particular point.
Mel Stride
My point is that the externalities that I referred to, such as covid and the war between Ukraine and Russia, have impacted economies around the world. Relative to other economies, and looking at the OBR’s forecast over the next five years, we will have a growth record that is up there and better than many of our major competitors, including countries such as Germany.
Matt Western (Warwick and Leamington) (Lab)
To clarify a point that perhaps I have misunderstood, what is the growth per capita record for the last seven quarters?
Mel Stride
My point clearly remains that growth is a function of both the size of the population and the level of productivity. As a consequence of all the elements that feed into growth, the OBR has confirmed that we will be growing a little faster at certain times than was anticipated at the time of the autumn statement, and our growth will compare favourably with countries such as Germany.
This debate is meant to be about making work pay, and the right hon. Member for Leeds West had very little —in fact, next to nothing—to say about that. [Interruption.] As she says from a sedentary position, she mentioned the national living wage—something the Conservative party is proud that it brought into being.
Mel Stride
You are thinking of the national minimum wage. The national living wage was a Conservative decision —[Interruption.] You did, but it is a pleasure to correct you on this occasion—[Interruption.]
Madam Deputy Speaker (Dame Rosie Winterton)
Order. This is the problem with conversations across the Dispatch Box. It is very difficult for the Hansard writers to follow if we veer off into private conversations. It should all come through the Chair.
Mel Stride
I am sorry Madam Deputy Speaker, and I am sorry for Hansard, but it was quite enjoyable. This debate is about making work pay, and the right hon. Member for Leeds West had precious little to say about that. I wonder why that might be. Might it be because unemployment has always gone up under Labour Governments? That is a simple fact for her to think about. It rose by 1 million under the last Labour Government. Youth unemployment rose by 45% under the last Labour Government, and the number of households in which no one had ever worked doubled during the last Labour Government. I find it particularly striking that under Labour 1.4 million people spent almost a decade on out-of-work benefits. Labour should be ashamed of that record of its time in office.
Jim McMahon (Oldham West and Royton) (Lab/Co-op)
The Minister mentions making work pay, but Unison has pointed out that a number of social care workers are being disadvantaged because HMRC mileage rates have not changed since 2010. Does the Treasury not believe that the cost of running a motor vehicle has changed in the last 14 years?
Mel Stride
One of the principal costs of running a motor vehicle is the fuel in the tank. Because of our stewardship of the economy, the Chancellor was able to announce yesterday that we are freezing fuel duty for the 14th year in succession, as well as beer duty, to help those supporting our vital pubs.
Yesterday’s Budget sets the course for a brighter future for our country. It is a Budget for long-term growth, with more investment, more jobs and an economy that is turning the corner. That has allowed us to cut taxes because this Government believe in rewarding aspiration and hard work.
Rushanara Ali
I am incredibly grateful to the Minister for giving way a second time. I remind him that the tax burden has gone up by £27 billion in the last year, and it will go up by £19 billion after the election because of decisions his party made. People who earn less than £19,000 will be worse off because of the Budget. Two decades of lost pay growth—that is the record of his Government over the last 14 years.
Mel Stride
I thought I had already covered this point, but the reality is that the tax burden has had to go up to pay for all the support we provided around covid, and because of the inflationary pressures created by a war on European soil. The hon. Lady cannot get away from the fact that through this fiscal event, and the previous one, 27 million hard-working people, employed in businesses up and down the country, will be better off to the extent of £900 per year. Some 2 million self-employed people will be £650 per year better off. She talks about those earning less than £19,000, but those many millions of people who earn above £19,000 will have a lower tax burden than before, when we take into account the interplay of the freezing of thresholds and the cuts in national insurance.
Stephen Kinnock (Aberavon) (Lab)
It has been widely reported that the taxpayer is having to pick up the tab for £15,000 of legal costs and damages incurred because of the actions of the Secretary of State for Science, Innovation and Technology, the right hon. Member for Chippenham (Michelle Donelan), who is rapidly becoming known as the hon. Member for “chipping in”. Will the Minister confirm that the figure of £15,000 is correct? Will he say whether he thinks it is morally right that the taxpayer should be picking up the bill for the outrageous lack of judgment and behaviour of one of his colleagues?
Mel Stride
What I think will be absolutely outrageous is the taxpayer having to pick up the bill for a future Labour Government. I have just explained the record of the hon. Gentleman’s party in government.
Sir Geoffrey Clifton-Brown (The Cotswolds) (Con)
My right hon. Friend is making a good case for yesterday’s announcements in the Budget. He has dealt very thoroughly with Labour’s record when in office, but will he turn his attention to its present proposals? If Labour will not reverse the tax on non-doms or the cuts to national insurance, does that not leave a whopping £6.5 billion in uncosted expenditure pledges?
Mel Stride
My hon. Friend is absolutely right. At the beginning of my speech, I invited the shadow Chancellor to explain to the House what she will do, given that the non-dom status will be abolished and windfall taxes on oil and gas will come forward. Will she once again U-turn and run for the hills, as she did with the £28 billion, or will she raise taxes or borrowing? Answer came there none.
Karin Smyth (Bristol South) (Lab)
When the Minister has time, he might want to read the shadow Chancellor’s speech in Hansard and help his colleagues who will be speaking later.
May I take him back to the subject of ordinary people? As a result of last year’s mini-Budget, people who remortgage are now paying £240 more—real money for them—than they were previously. If he does not accept that there is a £46 billion hole as a result of yesterday’s announcement, will he tell us what he thinks the figure is? Can he assure people who are remortgaging this year that they will not be further impacted by yesterday’s announcement and that there will not be a further scare on those markets?
Mel Stride
I can reassure all mortgage holders up and down the country that this Government are absolutely determined to see inflation return to its target. The OBR’s economic and fiscal outlook, published yesterday, makes it clear that we will meet the 2% target one year earlier than it forecast in the autumn. The significance of that for interest rates is obvious: interest rates will come down faster if inflation recedes quicker, and that is exactly what has happened.
Alex Cunningham (Stockton North) (Lab)
On that point, will the Minister give way?
Mel Stride
I have been very generous with my time, but how can I say no? I must then make some progress.
Alex Cunningham
The Minister is a decent man. The Government make much of getting value for money, but they have little to say about the handing over of Teesside’s greatest land asset to two private developers, who have since banked tens of millions of pounds in profits, leaving crumbs for the public. That is after the investment of £500 million of taxpayers’ money and no private investment. Is the Minister content with that, or does he believe, as his own Government’s inquiry into the Tees Mayor’s business dealings recommended, that the deal should be renegotiated?
Mel Stride
I will not get into the weeds of the issue that the hon. Gentleman is attempting to draw me into, other than to say that he made at least one comment that I agree with: I am indeed a decent man. I thank him very much for that.
Inflation is falling faster than expected. People’s wages are rising in real terms, and have done for the last seven months. Under this Government, our labour market has been strong and resilient, delivering opportunities despite the headwinds. We have put incentives at the heart of our welfare. We have grown faster than Germany, France or Italy. According to the OBR, we will continue to do so over the next five years. We are attracting the business investment that is key to growth, delivering high- quality jobs across the country—from Nissan to Google to AstraZeneca, which announced £650 million of investment only yesterday.
No matter how much the Labour party seeks to talk down Britain, the investment flowing into our economy is a huge vote of confidence in our country. It shows that our plan is working. By contrast, as has been laid all too bare this afternoon, the Labour party has no plan or credible record. I have already gone through the tale of woe about the level of unemployment that Labour has left us in the past. Those poor young people had a 45% increase in youth employment on the watch of the shadow Chancellor’s party, and over 1 million people were left on out-of-work benefits for almost a decade.
On the Government Benches, we believe that work, not welfare is key to improving living standards. That is why we are incentivising and rewarding work in this Budget. Making work pay and ensuring families are better off means tackling the global inflation that I have referred to, on which we are making significant progress. As inflation decreases, we recognise that there are still some people who need extra help. I was pleased to see the extension of the household support fund for a further six months from April, which was also pushed for by the Chair of the Work and Pensions Committee, the right hon. Member for East Ham (Sir Stephen Timms).
Sir Stephen Timms
The Minister is right that I warmly welcome that extension. Is there not a strong case for making the household support fund permanent, not just extending it for another six months?
Mel Stride
Six months is a meaningful period of time. Inflation is coming down. As the OBR says in its report, inflation is expected to hit target within the next few months, which will make a huge difference. It highlights some uncertainties around that, but £500 million of investment over six months, including Barnett consequentials, is a major move forward to support the most vulnerable.
The sustainable way to change lives is through work, and the evidence could not be clearer. It is good for the economy, communities and the individuals concerned. I want everyone who can work to have the opportunity to do so. One of the great labour market challenges is economic inactivity, and I want to put that into context. In the UK, inactivity has come down since its pandemic peak and remains lower than the average across the G7, the OECD and the European Union. Our progress has seen a significant fall in the number of people who are inactive because of caring responsibilities. We have the second lowest youth inactivity rate in the G7, and thousands of over-50s are returning to work.
However, the rise in the number of people out of work due to ill health and disability is stifling potential—potential that I am determined to realise. That is why, as we cut taxes for working people, our multibillion-pound back to work plan is providing substantial support to help the long-term sick return to work and keep people in the workforce. That includes doubling the number of placements on universal support, expanding access to mental health support, delivering Work Well, giving people earlier and better access to integrated work and health support, reforming fit notes and working with employers to improve occupational health. Through our next generation of welfare reforms, we are breaking down the barriers to work. Our chance to work guarantee will enable people on incapacity benefits to try work without fear of losing their benefits if a job does not work out. As the OBR has confirmed, our reforms to the work capability assessment will reduce the number of people on those benefits by 371,000. That is 371,000 more people getting the support they need to enter employment.
As part of our back to work plan, we are also tackling long-term unemployment, because the longer people stay in unemployment, the less likely they are to rejoin the workforce. That is why we are phasing in more rigorous requirements for fit and able jobseekers, with more time with work coaches, more intensive support and mandatory work placements. Ultimately, if a claimant does not engage with the support they are being offered, they will lose their benefits, underscoring our belief that we should always be there for those who need our support, but we must equally be fair to taxpayers.
By contrast, for all the protestations from the Opposition that they have changed, they are not fooling anybody. They are squeamish on conditionality, weak on sanctions and completely out of touch with the British public, who rightly expect a welfare system in which everyone meets their obligations.
Mel Stride
I am being asked to conclude, so I think I need to do that. [Interruption.] I have been pretty generous in giving way to just about everybody who has sought to catch my eye.
This is a Budget that rewards work and will grow the economy. It comes on the back of a once-in-a-century challenge that this Government have met. We have turned the corner, and this Budget takes us further still. It rewards work with lower taxes, it delivers growth, it makes work pay, and it ensures a brighter future for us all.
Peter Grant (Glenrothes) (SNP)
I thought it was interesting when the topics for these Budget debates were set, because those topics are what the Government want us to believe the Budget is all about. There is no mention of public services, the cost of living or climate change and net zero for any of the three days. We are talking about rewarding work, and I want to talk about rewarding not only those currently in work, but those who will be and have previously been in the workforce, because all three groups have been shamefully failed in this Budget.
For me, rewarding works means paying everybody a living wage—not a minimum wage. The Minister should be listening, but he does not particularly care about this. A wage that is not enough to live on is not a living wage—it is as simple as that. There is nothing in the Budget about banning exploitative zero-hours contacts. There is nothing, obviously, about repealing the shameful anti-strike legislation that the Government are imposing on a great number of public sector workers.
I wondered whether it was just that the topics chosen were not that good, and perhaps the Chancellor said more about those subjects in his speech. I had a look at the speech on the Treasury website—all 7,260-odd words of it. The word “poverty” is mentioned once, but “low pay” and “zero-hours” not at all. Net zero gets a mention, because the Chancellor mentioned his colleague, the Secretary of State for Energy Security and Net Zero, and zero emissions is mentioned once. Climate has not a single mention and Brexit—not surprisingly, as we are not allowed to talk about it any more—has no mention.
By necessity, some of my remarks have to be about what is not in the Budget, as much as what is. This Government are heading to become the worst Government in history for falling living standards. The Institute for Fiscal Studies has told us that it is unlikely that real household incomes will be any higher at the end of this Parliament than they were at the beginning. How can we call it economic growth when people in their real lives, in real houses with real jobs, do not notice any improvement in their standard of living over an entire five years?
Tax as a percentage of GDP will soon be the highest it has ever been. We have seen a £66 billion increase in the tax burden in this Parliament alone, and far too often it is people on lower incomes who pick up the biggest share. As has been mentioned, the six-year freeze on tax thresholds will cost taxpayers an extra £30 billion in stealth tax by 2027-28, even allowing for the impact of the 2p national insurance cut. The UK’s interest payments as a percentage of national income are about to become the highest for 70 years. If someone is an international banker, the rewards from work can be rich indeed, but they are not for someone trying to scrape a living in any kind of normal job.
This Chancellor’s time in office has seen the longest unbroken run of declining living standards since records began. The Government talk about rewarding work, but it is quite the opposite. Income inequalities in the United Kingdom are higher than in any other large European economy. What has the United Kingdom done that they did not, and what has everyone else done that the United Kingdom did not do? Germany, for example, had a covid pandemic, just as we did. Germany is impacted by the war in Ukraine just as much as we are—possibly more so, because it is physically closer to it. Middle-income earners in the United Kingdom are 20% poorer than their equivalents in Germany. I wonder what it could be that affected the economy and living standards in the United Kingdom that has not had the same impact on Germany, France, Italy and other EU member states? We are not allowed to say the B-word, so I will leave the Chancellor to work it out for himself.
As the Child Poverty Action Group has pointed out, child poverty is not inevitable, but a choice. It has said:
“With the right policy changes we can substantially reduce the extent and depth of child poverty across the country.”
Members do not have to take its word for what might happen if policies were changed; they need only look to what has happened in Scotland, despite the fact that the Scottish Government have substantially fewer fiscal, monetary and legislative powers than this place. Scotland now has the “game-changing” Scottish child payment—that is not our word, but that of the Child Poverty Action Group. We have the child winter heating payment, supporting the most vulnerable young people with disabilities to cope with their fuel bills. We have free school meals for everybody in primary 1 to 5 and for eligible children throughout their time in school.
Michael Shanks
The hon. Member mentioned the Child Poverty Action Group. After the Scottish Government’s Budget, it said that it was “bitterly” disappointed and that, as it stands, the Budget will at best stall progress, hampering progress towards reducing child poverty. Does the hon. Member think his own Government are reducing child poverty as much as they could be?
Peter Grant
I will come on to that in a minute. The Scottish Government are perhaps not reducing child poverty as much as they could, because nobody is ever perfect, but they are doing a blooming sight more than any Government down here ever will. As I said, we have free school meals for everybody in the first five years of primary school and for a great many children right up until they leave school. We have followed the example of our Scandinavian friends by welcoming every newborn baby in Scotland with a baby box containing the essentials for the first six months of their life. That is not just about practical physical help; it is also about the difference it makes to a new mum. It simply says to them, “We think your new baby is somebody special. Your baby is welcome as a new citizen of our country.” We have more than 1,140 hours a year of early learning and childcare for every three-year-old and four-year-old, and all eligible two-year-olds.
Karin Smyth
Just to correct an earlier point, when the hon. Member said that the Scottish Government would do more than any Government down here, I helpfully remind him that the last Labour Government lifted hundreds of thousands of children—I think up to 1 million —out of poverty, and we would seek to do that sort of work again. Who is in government here in Westminster does make a difference, does he not agree?
Peter Grant
I am not saying that a Government here cannot do it—in fact, I am saying that a Government here can do it. The problem is that the Government, which the hon. Member’s party said we could trust with the welfare system, are not doing that.
We have also introduced free bus travel throughout Scotland for 2 million people, including all young people up to the age of 21. That is important, because it not only significantly helps those people with the cost of their travel, and therefore the cost of living, but it encourages young people not to get into the habit of travelling by car. It encourages them to get into the habit of seeing public transport as a viable option.
In answer to the hon. Member for Rutherglen and Hamilton West (Michael Shanks), independent analysis has indicated that 100,000 children in Scotland will be kept out of child poverty this year because of actions by the Scottish Government. If the UK Government were willing simply to do what has already been done in Scotland, there could be 1 million fewer children living in poverty in the United Kingdom. Child poverty is not inevitable; it is a deliberate political choice. Scotland has chosen to say no to child poverty. The Budget has chosen to allow it to continue and to grow.
As well as the right support for children in low-earning families, the Government could have announced any number of things to help people in work to have better and secure pay. I have already mentioned the living wage, and they could have strengthened protection for workers instead of taking away the right to strike of those working in all sorts of public sector work.
Steve McCabe (Birmingham, Selly Oak) (Lab)
On strengthening protection, is it not true that the SNP hired people on zero-hours contracts to deliver literature during the Rutherglen by-election?
Peter Grant
It is in Private Eye and therefore it must be true. I do not know if that has been fact-checked. If the hon. Gentleman can provide me with evidence from something other than Private Eye, we will certainly look into it. I should say, incidentally, that the Labour party’s record of industrial relations in its own workforce is nothing to boast about. He might want to have a look in his own house first of all.
Among the other steps that the Government could take—I look forward to a likely incoming Labour Government committing to doing all this—they could outlaw despicable fire and rehire practices and support the Bill proposed by my hon. Friend the Member for Paisley and Renfrewshire North (Gavin Newlands). They could ban unpaid work trials, as was attempted by my hon. Friend the Member for Glasgow South (Stewart Malcolm McDonald) in his private Member’s Bill. They could give people the right to flexible working, rather than making it feel as if it is not really proper working. They could finally take action, seven years after the Taylor review. They could repeal the anti-strike legislation. Incidentally, the Scottish Government have undertaken not to use any of the anti-strike provisions included in that legislation. I look forward to an incoming Labour Government undertaking not to use them, as a precursor to repealing them altogether.
There are some changes in the Budget that we can mention, although they do not go far enough. Changes to the high-income child benefit charge are certainly welcome, but they do not go far enough to catch up with the downturn in income people have suffered over the years of that freeze. In the same way, the VAT charge threshold for small businesses, which increased by £10,000 a year, is welcome, but that is not enough even to make up for the deterioration in small business income after seven years of that ongoing stealth tax. Of course, we still have child maintenance liability for a non-resident parent based on assumptions about wage levels and cost of living levels that are years out of date. The Government say they do not have time in the legislative programme to bring forward primary legislation to change it. However, last week the House finished three hours early because we had nothing to talk about. Come on—if they were serious about it, they would have done something about it.
I mentioned net zero and climate change earlier, and I welcome the confirmation of up to £120 million more —although the words “up to” worry me—for the green industries growth accelerator, which is, to quote the Chancellor,
“to build supply chains for new technology, ranging from offshore wind to carbon capture and storage.”—[Official Report, 6 March 2024; Vol. 746, c. 844.]
Can we get an assurance that the Government will not make the same mistakes with that as they did with contracts for difference? The former BiFab yard in Methil in my constituency went into administration because although it could have made jackets for offshore wind turbines under contracts for difference, firms chose to import them from halfway around the world. While workers who could have done that work in my constituency were being laid off, we were paying to transport heavy-engineered goods from the other side of the world. Will the Government commit to reviewing the criteria for the GIGA to include the manufacture of those jackets? They make up about 40% of the total cost of a turbine and 40% of the supply chain but are currently excluded from that incentive scheme. If included, that could help to bolster the workforce in my constituency and a number of others across the UK.
I would like the Government to welcome again the contribution that green hydrogen can make to our net zero future. I am very pleased that Methil in my constituency is home to H100, the world’s biggest ever conversion of domestic gas supply to run on clean, renewable green hydrogen. It is the biggest example of that kind of green energy innovation anywhere on the planet. The next stage was even more ambitious: the Government promised to support what they called a hydrogen town pilot to extend the same technology and the same practices into tens of thousands of houses. I would love to see that happening in Methil and the surrounding areas, but I would rather see it happening anywhere than not happening at all.
The Government promised an announcement in March last year; that is now a year overdue. I, and many others with an interest in clean energy technology, are concerned that the Government are simply losing enthusiasm for this world-leading work. We threw away our world-leading position on other green energies during the Thatcher years. We cannot afford to do it again.
Briefly, I point out that if we are talking about rewarding work, we must also extend that to how we reward those who have finished their working careers and now rely on the state pension to get by. In spite of all the rhetoric, we still have one of the meanest state pensions in western Europe. There are still millions of WASPI women—women against state pension inequality —but the Government hope that if they just ignore those women, they will go away. They will not, so the Government had better stop ignoring them. We have seen more than £1 billion illegally underpaid to pensioners—that is utterly scandalous —and woefully inadequate protection from pension scams both for people building up their private pensions and, as some Members will be all too aware, for pension funds such as those of London Capital & Finance, British Steel and United Kingdom Atomic Energy Agency Technology, and dozens of others.
We have a Budget that chooses to leave hundreds of thousands of children in poverty, chooses to allow the scandal of low pay and exploitative work practices to continue, and chooses to continue inflicting stealth taxes that hit low-paid workers hardest. In answer to what the shadow Chancellor said earlier, I do not have a problem with debating a progressive tax regime that has lower taxation for the low paid and higher taxation for those who are better off. When we are talking about high rates of tax and low rates of tax, though, we should remember the entire tax burden and not just be selective about income tax, for example.
Let us look at council tax. I am the proud possessor of two council tax bills, with one for my house in Glenrothes and one that is paid by the taxpayer for the flat I use while I am down here. So I have the flat in London and, fortunately for me, a very nice detached house in Glenrothes. The flat in London already costs more in council tax than the house in Glenrothes, and this year the Labour-controlled council whose area I live in is likely to increase the council tax by 7%, while the council in Fife has accepted the Scottish Government’s funding to allow it to freeze council tax. The council tax on the flat in London will therefore be 15% higher than that on a very nice, spacious detached house in Glenrothes. When we are talking about the different tax burden on people between the two countries, let us consider the entire tax burden, not just the narrowly defined income tax burden. Of course, as I mentioned before, one reason why some people in Scotland pay higher taxes is that they are paid more than their colleagues doing the same jobs south of the border.
The Budget chooses not to support the children of working people. It chooses not to support working people. Then, when people’s working lives are over, it treats them far worse than people of a similar age and similar background are entitled to be treated in almost any other civilised economy. By contrast, the SNP has a vision for a country where every child and every parent is valued and supported, and knows that they are valued and supported; every worker is guaranteed a fair wage; every worker is protected from exploitation; every pensioner is entitled to a pension that is enough to live on without having to fall back on state benefits; and people get the care they need as they grow older and less able to look after themselves, valuing and fairly rewarding not only today’s workers but the next generation of workers and previous generations of workers, all of whom have been let down by this Budget.
I hold out no great enthusiasm that an incoming Labour Government will significantly change the situation. I would like to be proved wrong, but I cannot really see it happening. During the shadow Chancellor’s speech—it may have been an intervention—it was said that if the Tories had any confidence in their record, they should name the date for the general election. Absolutely. Can I suggest that if the incoming Labour Government had any confidence in the record of the Union, they would have no hesitation in naming a date on which to put it to a democratic test? We will wait and see whether the incoming Labour Government are a greater respecter of the will of the people of Scotland than the outgoing Conservative Government.
In his closing remarks, the Chancellor said that
“those with the broadest shoulders should pay their fair share”,
and I absolutely agree. He also said:
“An economy based on sound money does not pass its bills to the next generation.”—[Official Report, 6 March 2024; Vol. 746, c. 839-50.]
Oh, really? I agree with both those statements. For that reason, among others, I cannot support this Budget, and it does not deserve the support of anyone else in this Chamber.
Sir Christopher Chope (Christchurch) (Con)
It is a great privilege to follow the hon. Member for Glenrothes (Peter Grant), who speaks for the Scottish National party. What I did not really hear from him was the justification he and his party use for increasing taxes—something that is total anathema to almost everybody else speaking in the debate, who are complaining about the high level of taxes we already have.
I welcome the Government’s rethink on national insurance. As somebody who has regularly voted against increases in national insurance by previous Chancellors of the Exchequer, I am delighted by the change of heart.
I also welcome the rethink on the unfairness of the high income child benefit charge. When it was being legislated on, I put a lot of time and energy into asking questions about it and speaking and voting against it. However, I could not persuade anybody in the Conservative Government then that it was extremely unfair that a household with an income of £95,000 coming from one person was subject to this charge, while two earners were able to avoid it by each earning £45,000. That will now be put right; in my view, it is long overdue, but it is none the less welcome.
I would, however, be interested in asking the Minister a specific question arising from what was said about this issue: will the move to His Majesty’s Revenue and Customs using household-level information from 2026 enable the Government to introduce transferrable tax allowances and end the discrimination in the tax system against married couples? That would be an even bigger benefit of introducing household-level information and from taxing people on that basis. I hope that that will be one of the great spin-offs from this initiative, and I would be grateful if the Minister could respond to that point when he winds up.
I welcome the increase in the VAT threshold from £85,000 to £90,000. However, that is a pretty meagre 6% increase after seven years in which the threshold was frozen, and I would like to see it go even higher. I also welcome the Great British ISA, but why is it limited to £5,000?
Last night we had an amazing gathering in the Guildhall in London—I do not know whether any of my hon. Friends on the Front Bench were there. It was a celebration of the 50th anniversary of the Centre for Policy Studies, and it was a great occasion. It celebrated the work that Keith Joseph, Margaret Thatcher and Alfred Sherman did 50 years ago in setting up what has been the most successful Conservative think-tank of all time. I have to say, however, that there was universal disappointment in the audience that the overall tax burden has not peaked and that the Budget statement confirmed that it will rise even further in each of the next four years and beyond, despite the fact that we already have the highest tax burden ever. There seems to be no explanation as to why the Conservative Government are still pursuing that policy of increasing the tax burden.
As ever, the Prime Minister spoke eloquently, echoing the philosophy and founding principles of the Centre for Policy Studies. He spoke of the small state, the need for low taxes, and promoting enterprise and supply-side reforms. Indeed, his rhetoric chimed with the Chancellor’s own Budget statements, and I will quote three of them. The first was:
“Conservatives know that lower tax means higher growth.”—[Official Report, 6 March 2024; Vol. 746, c. 837.]
The second was:
“Keeping taxes down matters to Conservatives”.
The third was that
“lower-taxed economies have more energy, more dynamism and more innovation.”—[Official Report, 6 March 2024; Vol. 746, c. 848.]
I could not agree more. Yet we have a Budget that is actually increasing the overall burden of taxation and that seems to run counter to that rhetoric. My constituents are concerned about actions rather than words, and I hope that, in responding to the debate, my hon. Friend the Minister will explain why the Budget’s content does not fit with that rhetoric.
Where does that leave us? As we approach a general election—from my point of view, the sooner we have one, the better—I want to be able to tell my constituents that they have a choice between a Conservative Government who are really committed to the enterprise economy, following in the steps of the Centre for Policy Studies, Margaret Thatcher and Keith Joseph, and a Labour Government who are committed to ever higher taxes and burdens on individuals, with dire consequences for economic growth. At the moment, however, I am not sure that that is being spelled out with sufficient clarity to enable us to make the case as strongly as I would like when the general election comes.
Another issue raised in the Budget is that of low, if not declining, public sector productivity, which is a scandal of the highest order. Lip service was paid to addressing the problem of low productivity in the national health service, but low productivity has been endemic in the NHS for years. I was looking at a book produced by Lord Crisp—Nigel Crisp—when he worked for the NHS, and in it he refers to the low or declining productivity in the NHS between about 2000 and 2010. The latest figures also show a decline in productivity in the NHS. Two years ago, the Government committed themselves to productivity increases of 2% per annum in the NHS. I thought that that was already policy, but I see in the Budget statement that the head of the NHS, Amanda Pritchard, is saying, “Well, with the extra initiatives from the Government, we might even be able to get to a productivity increase of 1.9%.”
Jim McMahon
I will give the hon. Gentleman a second to take a breath. Does he accept that the NHS does not sit in isolation? It is part of a wider ecosystem of public services, and it reflects local communities. So many preventive early intervention services, such as those provided by local government, have been taken away, and that has an impact. Like me, the hon. Gentleman will be aware that we have seen 900,000 fewer workers in local government since 2010, but 900,000 more workers in central Government, and the civil service has grown too. That shift has definitely had an impact on productivity.
Sir Christopher Chope
I agree with the hon. Gentleman that, by expanding the public sector and the number of administrators, we are undermining our attempts to increase productivity. The OBR says that a 5% increase in productivity would give us a £20 billion dividend, so instead of fussing about £1 billion here, £100,000 there or whatever, why do the Government not concentrate on productivity?
One example of the lack of productivity is the increase in bed blocking. I have an example from my constituency, which I raised in a parliamentary question recently. On 31 January, 308 patients in acute hospitals in Dorset were there with “no criteria to reside”, which is how what used to be called bed blocking is described these days. If we take a ballpark figure and say that each of those beds costs about £1,000 a night, that is £300,000 a night. If we multiply that by the 365 days of the year, we get an enormous figure. Money is being wasted through the NHS’s inability to address that long-standing problem.
Despite the establishment of integrated care boards, the problem is getting worse, rather than better—the whole essence of integrated care boards was to try to link together all the players.
Matt Western
Does the hon. Gentleman agree that not enough appropriate sheltered housing has been built over the past 14 years? Given the ageing population, surely we should be making greater provision.
Sir Christopher Chope
My constituency has an enormous amount of sheltered housing and housing specifically for pensioners. A lot of it is vacant—it has been built, but it is not occupied at the moment. I am not giving a plug for Churchill or any of the other housing developers, but I do not think that issue is really the key. The key is knocking some heads together and getting them to realise that when somebody is ready to leave hospital, they do so and that there are significant penalties if they do not.
There are lots of other examples of where we have a productivity crisis. It is worth recalling that Sir Roy Griffiths, who was brought in by Margaret Thatcher in 1985 to try to introduce greater efficiency into the health service, said
“if Florence Nightingale were carrying her lamp through the corridors of the NHS today she would almost certainly be searching for the people in charge”.
One could bring that up to date now and say that today Florence Nightingale would almost certainly be looking for anyone willing to get to grips with low productivity in the NHS. I hope that the Government will get a lot more serious about the issue than they have been hitherto.
My final point is about the dynamism that comes to the economy if we reduce taxes and encourage growth through that means. In his speech, the Chancellor made passing reference to Arthur Laffer and his curve. Some of my hon. Friends may have been present at a previous dinner organised by the Centre for Policy Studies at which the speaker was Dr Laffer himself; I still treasure a napkin that has his handwritten curve on it. Why are we not applying the principles of his curve more widely?
In his aside about Laffer, in the context of reducing capital gains tax from 28% to 24%, the Chancellor was more or less saying, “Well, at last my officials are waking up to the importance of this.” But who is in charge? If the Chancellor of the Exchequer and the Prime Minister believe in the virtues of the Laffer curve and the dynamism that comes from a low tax, low regulation economy, surely they should be getting a grip on that rather than leaving it to anonymous officialdom.
I hope that we will be able to make more progress on these key issues and demonstrate to the public that there is indeed a big chasm between the two parties vying to form the next Government. We believe in the virtues of low taxes promoting enterprise and increasing productivity, particularly in the public sector. The other lot are beholden, particularly to the unions, which takes me back to where I started off in politics: when I was first elected to Wandsworth Borough Council, 50 years ago this week.
Holly Lynch (Halifax) (Lab)
In this Budget debate, I want to focus particularly on schools, children and young people, and the pressures facing headteachers and local authorities in struggling to balance their budgets. We get one chance at getting a child’s primary education right: they will not get those years back and we will not get that opportunity back. It is the one and only chance to set the foundations for their future, and every child is a building block on which our hopes and aspirations for the country rest.
In January this year, the local campaign group Calderdale Against School Cuts conducted an anonymous survey of all Calderdale primary headteachers about their budgets and how they were managing school funding. Some 65% of the schools contacted completed and returned the survey representing a broad cross-section of schools, from right across Calderdale’s communities.
The survey revealed that in this financial year half of all headteachers had made reductions to teaching staff, while 84% had not replaced staff who had left. Some 73% had reduced support staff and 47% of primary heads were planning to make staff redundant to balance the books. Some 80% of schools had been forced to cut back on maintenance and building repairs. Perhaps most worryingly, 100% of the heads who responded anticipated that their school would be struggling to cope in the near future, with concerns about balancing the school budget for the next three years.
An ever-increasing number of schools now face the prospect of deficit budgets, forcing them to make redundancies within both their support and teaching staff. The results show that because of financial constraints, the non-replacement of staff is no longer a choice but a necessity, which places even greater demand on the already stretched remaining staff. Headteachers were keen to stress that it has become increasingly difficult to recruit support staff to work in schools, given that they can earn more working in local supermarkets, for example.
In addition to the financial pressures facing all schools, there has been what we can only describe as an explosion in the numbers of children with emotional, behavioural or mental health difficulties, and schools are especially struggling with resources, funding and specialist support for that cohort of children. Calderdale Council has a predicted £5.9 million overspend on high-needs children. It also reports a 150% increase in the number of children with education, health and care plans since covid. When a school has a child with additional needs recognised by an EHCP, it has to find from its existing budget the first £6,000 to provide support for that child. In reality, the only way that is achievable is by diverting money away from the day-to-day provision of teaching and learning.
The Halifax Courier ran the survey results on its front page with a headline about how cuts were pushing schools to the edge. The article included this quote:
“Our survey confirms that cuts to funding, rising poverty and SEND are pushing schools to breaking point.”
Nationally, according to the Department for Education’s own figures, one in eight local authority maintained schools was in deficit in 2022-23—the highest number of schools in deficit on record. The Observer also ran the survey results, with a quote from a Yorkshire primary head teacher:
“We are approaching a time when it isn’t safe to open. There will be children who are being violent and there won’t be enough staff to manage.”
She said that she had not been able to justify replacing teachers and support staff who had resigned over the past year and that in September she will be forced to merge a year of children containing many who are vulnerable and have additional needs with the year above, because they are losing yet another teacher. She said:
“You have to do it to make your budget work, but what about the impact on the children?”
Mungo Sheppard, the truly outstanding headteacher at Ash Green Primary School, which serves the Mixenden area of Halifax in my constituency, told The Observer:
“Heads are forced to balance the books rather than saying ‘How many staff do we actually need for our children?’ It’s terrifying.”
He said that some local schools are having to cut pastoral roles as well as teaching jobs, and that many no longer have enough classroom support staff
“to cater for the ever-growing needs of children”.
He added that despite being over-subscribed, his school will have a “large” deficit by April next year and
“other local schools are already in perilous situations, running out of money”.
Ash Green serves one of the most deprived parts of my home town. Led by Mr Sheppard, the staff delivered food and vouchers during covid, just to make sure that children and their families had at least some food on the table. Just when staff were starting to get some respite from the soul-destroying challenges of covid, the school was hit by deliberate arson, which tore through several classrooms. The school runs a breakfast club because so many children were going without, and it has also set up a lending scheme for families and parents who have nowhere else to turn. The staff at Ash Green represent school staff up and down the country, who have to overcome so many challenges before they can start the school day. It is just not right that the staff and headteacher spend so much time worrying about how he will balance the books in order to cover the basics of paying the staff’s wages and keeping buildings and children safe.
Schools are increasingly picking up the pieces of our broken society. The Government have finally woken up to doing something about non-dom tax status, adopting our long-standing policy, and we are still 100% committed to funding breakfast clubs, additional teachers and mental health specialists in schools—pledges that we know are necessary and that we are incredibly proud of. There was nothing in yesterday’s Budget for councils, which have limited means of providing any additional support to schools.
The Labour leadership of Calderdale Council and some truly dedicated officers are working their socks off to balance its budget. They will find a way, but they are struggling financially and morally to do so. In the last financial quarter, Calderdale Council’s budget for children and young people had a £7.8 million overspend, which has increased by £1.7 million this financial year. The biggest driver of that overspend is the rising number of required placements for children in care, with the costs rising significantly. The lack of placement availability nationally and locally is a key factor, as it is everywhere.
The Chancellor had something to say on this issue yesterday, stating:
“Too many children in care end up being looked after by unregistered providers that are much more expensive”.—[Official Report, 6 March 2024; Vol. 746, c. 848.]
He announced some new investment, with the Government pledging to develop
“proposals on what more can be done to combat profiteering, bring down costs and create a more sustainable market for residential placements,”
which they will publish later this year. I really struggle with the use of the word “market” to describe placements for children in care—it reveals everything that is wrong with children’s social care—but the announcement comes two years after the Competition and Markets Authority concluded that the profits of the largest private children’s home and fostering providers are higher than would be expected in a well-functioning market, with average margins of 22.6% in residential care between 2016 and 2020. That begs the question of why it has taken so long to do anything about this issue. Why have the Government allowed the system to become so broken, to the detriment of both local councils and some of the most vulnerable children in our society?
With that in mind, why on earth are the Government not doing more to support kinship carers? In 2021, it was estimated that there are 130,000 children in kinship care, but this figure accounts for just 15% of children in the care system. I urge Ministers to look again at the Family Rights Group’s call to extend the financial allowances pathfinder to more local authorities, and to remove the perverse criterion that children must have previously been looked after to be eligible. The pilot scheme for a new kinship financial allowance is under way in only a small number of local authorities, with very narrow eligibility criteria. We know that it could be a way forward for councils, carers and, most importantly, vulnerable children, so will the Government please accelerate that work, make this issue a priority and roll out support for carers beyond the pilot scheme?
The OBR has confirmed that this will be the worst Parliament on record for living standards, and the only Parliament on record in which living standards have fallen. The BBC reports that Nottingham City Council, Birmingham City Council and Woking Borough Council all went bust in 2023, following Thurrock Council and Croydon Council—for the third time—in 2022. It is even more harrowing that half of all councils are warning that, without reform, they will be effectively bankrupt within five years. Do the Government think that this is some kind of phenomenon, or could it be a direct result of their decision making and their actions?
The Budget will come as no relief to schools or councils that are desperately trying to undertake their statutory duties to educate children and keep them safe. We need to be in a position to deliver Labour’s commitments. We need a general election.
Dame Jackie Doyle-Price (Thurrock) (Con)
It is a pleasure to follow the hon. Member for Halifax (Holly Lynch). She was doing so well until she mentioned Thurrock.
Perhaps I could give some clarity on why Thurrock Council got in such bad financial trouble. Over the last decade, as some Members will know, Thurrock was the subject of very aggressive three-way politics, with the UK Independence party holding the balance of power between a Labour minority administration and a Conservative minority administration. Frankly, it was impossible to get a balanced budget passed, because sensible decisions would not be taken to either increase council tax or reduce spending. That led council officers to pursue a risky borrowing strategy in order to plug the gap. The lesson we should learn is not so much about the Government’s overall strategy on local government, but about the need for all of us, wherever we are in public life, to take sensible decisions based on positive outcomes for those we serve.
I listened very carefully to what the hon. Lady said about special educational needs, and she is absolutely right: it is an issue that we really need to get to grips with. The Budget is great for providing plenty of knockabout between the Front Benchers, but her speech reminds us that we really need to think in a more granular way about whether we are delivering the outcomes that we want for a mature, advanced society, and particularly about whether we are delivering the best outcomes for those who are most vulnerable and perhaps least able to speak for themselves.
We are witnessing some very real challenges for children with statements in our schools, for a whole host of reasons. One of them is that, for a while, there was a fashionable view in the educational establishment that children with special needs ought to be educated in a mainstream setting. That will work for many of them, but we will fail others, including others in the school, if we continue with this model. Overall, it has led to under-investment in special provision, which has resulted in so many schools having to manage more and more children with special needs. I have seen that at first hand in my constituency. We have reports of a massive post-pandemic increase in children with statements, not all of which are related to having been out of school; some of these things are genetic. There has been a massive increase in children presenting as non-verbal, and we have not really got to grips with why that is.
We need to acknowledge that the explosion in special needs is being absorbed by our school sector. Let us pay tribute to those working in the sector, who are doing their best. I have seen at first hand the real efforts being made in some of my schools to manage this issue, and to give the best possible education to all pupils. I recently visited Tudor Court Primary School in my constituency, where I was told that 13% of the school’s intake now have a statement. I was also told that the figure is low compared with that for other schools, which strikes me as a significant indication that this issue ought to become a top priority.
I come back to the fact that we must, first and foremost, look after those who need our help the most, not those who shout loudest. I often say that this place works best for the pointy-elbowed middle classes. We really need to make sure that we focus on those who need our help the most.
Karin Smyth
The hon. Lady makes an excellent point about special needs provision in most authorities across the country, regardless of the politics of a place. The situation is really damaging for young people. Bristol City Council has become part of the Government’s safety valve initiative, along with neighbouring Conservative- run councils and others. Does she agree that we need to take a serious look at this issue across the country to understand both demand and the provision that already exists, and that we need to work together for the benefit of children coming through the system and their families, who are so desperate for support?
Dame Jackie Doyle-Price
I agree, and we should embrace this outbreak of consensus. The hon. Lady is absolutely right, because we cannot tackle this in a silo. Ultimately, it is for the local authority to ensure that a statement of special educational needs is given, but equally, local authority budgets are under pressure. I went to my local education authority a few years ago to talk about the need to progress a free school application for special provision, and I received a clear message: “We don’t want to encourage that, because people will move here, and we would have to look after them until they are 25.” We need to look at this at a high level to make sure that we deliver the provision that is needed across the board.
Turning to the substance of the Budget, I welcome the decision on national insurance, which is clearly no longer the contributory levy that it once was. The idea was that people bought credits towards their pension and out-of-work benefit entitlements, which have become much more universal, so national insurance makes no sense as a separate tax. That raises a philosophical debate about whether there ought to be a contributory principle for some services. In particular, we still await a long-term solution to funding social care.
Although I welcome the aspiration to remove national insurance, we still need to sort out social care funding. There is still uncertainty about how we fund social care, and local authorities are again left to pick up the pressure. It has been very convenient to give local authorities that responsibility, but we need to do our bit. Ultimately, everything has to be paid for. If we are to have mature and sensible long-term decisions at central Government level, we need to give local authorities the same space. While there is still uncertainty about how the cost of social care will be met, local authorities cannot make sensible decisions, and the disasters that the hon. Member for Halifax described will only become more common.
We need to look again at how to ensure that local authorities make mature and sensible decisions about their budgeting. The Audit Commission has been replaced by audit firms, and the frank advice that ought to be given has simply not been given. We used to have the surcharge, which was a very blunt instrument, to ensure that councillors made mature and sensible financial decisions, but now councillors have no stake.
We often say in this place that we have great champions for local communities, but we have to show leadership and maturity in making sensible decisions. When it comes to local councils, we have the same situation on speed. They have great local ward champions who view themselves as street-by-street spokespeople for every problem, but they perhaps do not properly recognise their corporate responsibility for making sensible judgments. Councils are multimillion-pound businesses that are there to deliver outcomes for the whole local authority area, not just individual wards.
As well as looking holistically, we need to make sure that, where local authorities get things wrong, there is an element of accountability outside the ballot box, especially because local election turnouts are so poor. That is all our fault. We are all politicians, and it is our job to motivate people to vote for us. I am often frustrated by the knockabout of political debate, which is a big turn off—it is sometimes a big turn off to sit here on a Wednesday lunch time. For people who are not engaged with politics, it is an even bigger turn off. The result is that, particularly in local politics, people zone out and switch off.
Even after the biggest failure in local government finance, the turnout in my local election in Thurrock was less than 20% in some wards. Is that not shocking? It tells us that the public are thinking, “Well, it doesn’t make any difference. It doesn’t matter who I vote for. Nothing will change.” We should all think about that as the general election approaches, because I detect the same mood out there.
Grahame Morris (Easington) (Lab)
The hon. Lady is never a turn off for me. She is making some excellent points, not least in respect of SEND children and kinship carers. The needs of those individuals and groups should be addressed.
On local government finance, my local authority is a coalition of Conservatives, independents and Lib Dems. Heaven knows I have criticised it an awful lot, quite justifiably, but we should recognise that all local authorities, including mine and Thurrock, have had to deal with huge cuts over the past 10 or 14 years. My local authority has had to cut £260 million from its revenue spend. I was looking at some figures, and would it not be more sensible to change council tax—
Madam Deputy Speaker (Dame Eleanor Laing)
Order. We have quite a lot of time this afternoon, but that is an incredibly long intervention. I am looking forward to the hon. Gentleman’s speech in due course.
Dame Jackie Doyle-Price
I acknowledge that there have been cuts to local authority budgets, but the root of this is that so much local authority funding comes from the centre. Where is the accountability? As far as local electors are concerned, the council can spend only what it is given. Given the cuts, it is incumbent on councils to make sensible decisions. They cannot have their cake and eat it. They have to live within their means.
Given the rainbow coalition that the hon. Member for Easington (Grahame Morris) has just described, I suspect that there is an awful lot of playing to the gallery. We expect our councillors to be more mature.
Sir Christopher Chope
Does my hon. Friend agree that one of the problems is that we gave local authorities a power of general competence, and that we should have concentrated their mind on the things that they really have to do?
Dame Jackie Doyle-Price
Yes, I agree. With hindsight, that was a big mistake. It was done with the best of intentions. Given that local authorities were in a new set of circumstances, there was a desire to give them freedom to be more relevant and to have fewer constraints, but it has given licence to risky behaviour. We will see further consequences of that in due course.
Clearly, we would all like to be in a much better place with regard to the strength and growth rate of our economy and the state of our public finances, but we need to reflect that the last 15 years have been challenging. We have had three significant shocks that have cumulatively made us poorer than we would like to be—that is just a fact. The 2008 financial crisis had to be managed, and we have had the consequences of the pandemic; one way or another, we locked down our economy for the best part of two years, which has clearly had a massive impact on growth. The billions that we spent on keeping people in their jobs still have to be paid for. There is also Ukraine. Not only do we need to support the people of Ukraine, but we need to address the consequences for energy prices.
Returning to the need for responsible leadership, we should level with the public about what these things mean. The public are not stupid, and they are not deceived by spin and rhetoric. They know that these shocks have consequences. If we do not treat people with the respect that they deserve by levelling with them, they will show us the same lack of respect. They understand that this all needs to be paid for. If we do not face up to that, we will end up compounding the challenges created by those political choices.
I return to the financial crisis. Clearly, there was a need for a massive intervention to prevent the whole banking system collapsing, but we got addicted to quantitative easing. The correction that should have taken place following that financial crisis never happened, because, guess what, we do not want middle-class people who vote to have a reduction in the value of their property. By sticking with that policy, we ended up with interest rates that were artificially low for a very long time, which completely distorted asset class prices. That meant that everyone put all their investments into property, which has contributed to massive inter- generational unfairness, because people cannot now afford to buy a house. Does that not just show the short-termism and the failure to get real, explain things to the public and make long-term financial decisions that will do the most to grow this country? We all bemoan the lack of growth in our economy but if we have generated a system where there is more profit to be made by investing in housing than in business and wealth creation, this is where we end up. We all need to make a determined effort to be more long-term in our decision making and not just pursue the retail benefits of going up a few percentage points in the opinion polls.
We spent billions during lockdown to keep people in their jobs, but, again, that has to be repaid by the taxpayer. People do understand that; they know that nothing can be made for free. We also need to address the wider consequences of what we did in lockdown, because there is a longer-term impact on our nation’s productivity. We were all psychologically damaged by being taken out of social circulation for two years, and we have ended up with work practices that are not always the most efficient. Worst of all, we have an expectation that the state will deal with every problem. Again, we need to get back to having the leadership that says, “We’ve all, collectively, got to fix this problem.” Fighting covid is the equivalent of fighting a war. After the second world war, everyone knew that there was going to be a massive effort to get our country back together again. We have pretended, never more so than on public services, that the situation is easier than it is.
I hear over and over again about underfunding, but what does that mean? If there is not enough money to deliver what people are expecting, we have to be honest about that and cut our cloth; we have to recognise that nothing can be delivered without being paid for, so we must either increase taxes or look at what we are delivering. We all want to get to a position where we are much richer and can pay for a lot more, but concessions will have to be made before we get to that place after the shock we have had to deal with.
We also need to have a much more honest debate about what we should be spending our money on. The situation in Ukraine clearly illustrates the need to spend more on defence. Since 1989, we have taken our eye off the ball, but we now face a more challenging and unstable world. To keep our energy prices low and stable, the best measure is to invest in defence at an increased rate.
The two biggest challenges that face us are perhaps not the focus of mature debate or leadership by this place. First, there is no doubt that the public think we have too much immigration, on which we have become dependent as a source of cheap labour. From 2006, the UK’s openness to immigration from eastern Europe had a very positive effect on growth, but it was “growth” as in the overall quantum. The impact on individual productivity, earnings and GDP per capita was poor, because earnings were depressed. Overall, the resentment towards immigration comes from a lot of those people who found their earnings diminished as a consequence. We think about the “Auf Wiedersehen, Pet” generation of builders and labourers who earned lots of money by going overseas. Post-2006, they found that their earnings were depleted because people here were choosing to employ Lithuanians and Poles, because that was cheaper labour. Naturally, they will have a clear view that immigration has reduced their earnings.
Peter Grant
The hon. Lady’s account is completely inaccurate. Often UK employers have employed workers from the European Union because the labour has not been available here. That is why, for example, we now have a crisis in recruitment to social care professions; we have stopped the Europeans coming in and there is nobody in the UK who is able to do the work.
Dame Jackie Doyle-Price
On social care, the hon. Gentleman has a fair point, but I do not think that what he says is true as regards HGV drivers, builders, labourers or anyone else in the construction industry. It is true that we have relied on cheap migrant labour to deliver social care, but that is largely because we have not valued social care as a profession. While we have had that abundance of cheap labour in the sector, we have also been able to kick the can down the road about how we fund social care and our later stage of life, so the impact has been not just on earnings but on allowing policymakers to be lazy about grappling with these difficult issues.
Danny Kruger (Devizes) (Con)
My hon. Friend is making an important speech, with the authentic voice of common-sense Conservatism, which we need to hear much more of. The point she makes about the depressive effect on wages of the high immigration so far this century is incredibly important and relevant to the debate we are having about the workforce. Does she agree that at least our party has a plan to reduce legal migration substantially in the years ahead, which is more than we hear from any Opposition party?
Dame Jackie Doyle-Price
I do agree that we have a plan, but I say to my hon. Friend that it has to be more than words—it has to be delivered on. I am sure he would agree on that. He will have heard, as many of us have, about how many industries have lobbied us to ensure that such and such a profession is added to the skilled workforce list. Those employers do not want to pay those higher wages and we, as politicians, need to be robust about that and say, “You know what, we genuinely want to deliver a high-wage, high-skilled economy. If you want to employ HGV drivers, you are going to have to pay them the money they deserve.”. That is how we will reward aspiration and hard work by the people of this country, and, overall, we will have better growth. It is not going to be painless getting there, because some employers will have to start paying higher wages and that will filter through to higher prices. But that is how we correct our economy and become the great world leader that we should be. We should be the powerhouse of the G7; given the skills and abilities within our country, we should be leading the world. We have allowed ourselves to become impoverished by quick fixes, to be brutally frank.
I come to my final issue. I have said for a long time that the biggest challenge facing this country is the lack of affordable housing and the failure to build enough new homes. I welcome the continued emphasis by the Government on this issue, but we are still failing to deliver. Yesterday, the Chancellor mentioned new investment to facilitate new housing in Barking and Canary Wharf. If we are to learn from what can go wrong, I encourage him to travel a few miles east to my constituency, to Purfleet. It sits on the River Thames and it has a railway station that can take people to Fenchurch Street in the City of London in 45 minutes. We have been talking about building 3,500 homes in Purfleet since 2008. If they were constructed on the River Thames, 45 minutes from central London, these homes would have sold themselves. Purfleet Centre Regeneration Limited, a public-private partnership, was developed to deliver these homes. It had £70 million-worth of public land gifted to it. It was granted £5 million in 2015 to kickstart the works, and it subsequently received £70 million in housing infrastructure funding. The first house was promised to be constructed by 2018. We are now in 2024, and we do not have a single new home after all that public money.
I want the Government to register that while it is great to see capital funding being made available, with all these wonderful brochures with nice plans for new homes, nothing is being delivered. I wonder whether there is something wrong with how we approach these things. From where I am sitting, I can see consultants who have managed to earn a pretty penny over the past eight years out of Purfleet, but we have achieved nothing except the disappointment of the public. The public have supported and got behind these proposals, but have found their hopes and ambitions dashed. They deserve better. They have been seriously misled by a number of people. It is not for me to apologise to the people of Purfleet—I have done my best to call out the fact that the emperor had no clothes for a very long time—but the public gets very disillusioned when promises given by politicians come to nothing. If we really are to deliver more new homes, then we need to look at why we have not realised the ambitions from such projects in the past.
Rushanara Ali (Bethnal Green and Bow) (Lab)
After 14 years, we needed a sober and serious plan to revive our economy, boost productivity, and encourage entrepreneurship and investment to power serious economic growth. We needed a Budget for growth. Instead, what did we get? We got reckless gimmicks and political trickery.
When the country is crying out for renewal and investment in public services, this Budget puts party before nation. After 14 years of Conservative rule, our economy has been wrecked and vandalised. Before yesterday’s tinkering around the edges, we knew that public debt as a share of national output was at its highest since the 1960s. Debt interest payments are at their highest level since the second world war. The economy is smaller per capita than when the Prime Minister took over after the mini Budget fiasco, when his predecessor and the then Chancellor crashed the economy. This will be the first ever Parliament in which living standards, as a measure of real household disposable income, have fallen.
The Conservatives now expect us to rejoice in their planned expenditure of £9 billion on tax cuts, which will be funded by increased borrowing. This will be dwarfed by the £27 billion of tax rises that came into effect last year, and the further £19 billion that is due to come into effect after the election, because of the choices and the decisions that they have made.
Let us look at the impact of these measures on different groups. Research by the Women’s Budget Group shows that single men will gain, on average, close to £500 more a year than lone mothers from the combined national insurance cuts in the autumn statement and spring Budget. The Institute for Public Policy Research estimates that half the tax cuts will go to the wealthiest households, and just 3% to the poorest.
We also heard the Chancellor boast yesterday of the Conservative party’s intentions to scrap national insurance altogether. Without any plans to fund this, we would see a £46 billion black hole in the country’s finances every year. That is deeply irresponsible. The Conservative party should have learned its lesson, having crashed the economy with the omnishambles of its mini Budget and its £45 billion of unfunded tax cuts, which came at a very high price, particularly in relation to costs and mortgage hikes. And people are still living through that crisis, while the former Prime Minister remains in denial, as she goes off and earns huge amounts of money, dining out on having crashed the economy. This is why my right hon. Friend, the shadow Chancellor, has committed to upholding and strengthening the role of the Office for Budget Responsibility. Only Labour can deliver the economic stability that this country desperately needs and put an end to the Conservative party’s fantasy of unfunded and unsustainable tax cuts.
Steve McCabe
I just wonder whether there is any scope for a special “crash the economy” tax, so that we can claw back some of the money that the former Prime Minister has earned from her speaking tour.
Rushanara Ali
For a start, the former Prime Minister could certainly donate her earnings to the millions of children now living in poverty—poverty that was worsened by her crashing the economy. The parents of children in my constituency are having to work even more to make ends meet, particularly to pay their mortgages, which in some cases have doubled. That is the consequence of the rot that she and her Chancellor caused by crashing the economy.
Matt Western
On a more serious note, reports allege that, ahead of that mini-Budget, the then Chancellor briefed certain hedge fund managers and they made significant financial gains off the back of it. Surely there should be some comeback on that
Rushanara Ali
My hon. Friend makes an important point. Those reports were well publicised at the time, and it is shocking that there has not been an investigation or an inquiry into what happened. Shockingly, the then Chancellor and Prime Minister continued to behave as if they had done nothing wrong, as if we should be grateful that they were in charge at the time. They continue to go on speaking circuits, gaslighting the British public, having crashed the economy and ruined their lives. We are still paying for that. The time cannot come soon enough for this episode to be over, for a fresh start with a new Labour Government.
Of the current Chancellor and his Budget, the former Treasury Minister David Gauke said in an article in the New Statesman that the Budget was a “work of fiction”. He said:
“He wants to be prudent and responsible, and he wants to cut taxes. The reality is that he cannot do both.”
I have a lot of time for the current Chancellor, who inherited an awful situation, but he has not faced up to the reality of needing to be responsible. His former colleague set that out in the article. It is not Labour that is attacking the decisions of the current Chancellor; it is his own former colleague, who was a respected Treasury Minister.
When it comes to growth, one does not need to be an economist to know that the Government’s economic policy is failing. Wages have fallen behind and, according to the Resolution Foundation, real wages will only return to 2008 levels by 2026. That is nearly two decades of lost pay growth, nearly two decades of people not seeing an improvement in their living standards, and nearly two decades of people having to face real-terms wage cuts. By contrast, real wage growth across the OECD as a whole has risen by almost 9%, on average, over the same period. This is costing British workers an average of £3,600 per year. It means that they have had less to spend and, on top of that, they have had to live through the mini-Budget crisis, made in Downing Street, and the cost of living crisis that came after that.
The House of Commons Library shows that UK food and alcoholic drink prices were nearly 7% higher in January 2024 than the previous year, based on the CPI measure of inflation. What does that mean in practice? In constituencies such as mine, and up and down the country, it means millions more children living in poverty during the last 14 years, children in this country going hungry because of the failures of this Government, and parents having to work more hours just to keep their head above water. That is the consequence of what the Conservatives have done to people’s lives in this country.
The Budget leaves those who earn £19,000 or less worse off. That cannot be right. The Office for Budget Responsibility’s forecasts show that GDP will grow by just 0.8% in 2024 and 1.8% in 2025. What about productivity? The Government have talked about the productivity puzzle for a very long time, but they have not managed to address it. In the last quarter of 2023, productivity was estimated to be 0.3% lower compared with the year before, according to the Office for National Statistics. What we have, and have had, is sluggish productivity, flatlining growth, stagnant wages and rising prices. No wonder our country is in recession.
As a consequence, the Government have presided over declining investment in our public services. We have seen the spectre of queues for dentist appointments; people stuck in hospitals because of the failure to invest in local government and social care; the police struggling to cope because of underfunding and cuts in police numbers; the criminal justice system facing massive cuts and, as a result, people not getting justice; major infrastructure projects cancelled, such as HS2, which means that investors have lost confidence; and so much more. I could go on, but I appreciate that others want to speak.
The question is whether people feel better off than they did in 2010 when the Conservative party came into government. The answer is no, because they are working longer hours and working harder. After austerity, which damaged our public services, and after the mini-Budget crisis, which crashed our economy and cost £60 billion to begin with, along with mortgage increases, food price hikes and much else, people are not better off. Of course, we have not mentioned partygate, the abuse of power, the billions wasted in personal protective equipment contracts, and the money wasted in fraud. The billions that we could have used to support people instead went to waste, and in particular cases went into corruption, which has not been addressed.
We have seen an endless queue of Chancellors and Prime Ministers, one after another, experimenting on our country and letting people down. Political and economic instability is causing huge distress to people in our country. What do they have to show for it? A cost of living crisis, often made in Downing Street, and a sticking- plaster Budget designed to help the Conservative party to remain in power. People can see right through it; they will not be fooled by what has been provided. We need a serious Budget for productivity and growth—no more wasting opportunities and people’s talent. We need a Government focused on national renewal, and an economic strategy for growth, which we did not get yesterday.
We could have had a sustainable programme for supporting the small and medium-sized businesses that power our economy—99% of our businesses are in that sector. They could be supported much more to grow our economy. We could have seen much more support for those in the homebuilding industry by reforming the planning system. We could have had more investment in green industries and generating green jobs; a new national wealth fund to unlock billions in private investment; a skills revolution in the form of setting up new technical excellence colleges; and investment in the younger generation, and their skills, education and early years. We could have seen a shift in making work pay, with a genuine living wage, banning zero-hours contract and ending fire and rehire.
Those are some of the things that the country desperately needs. We have seen none of that. We have seen no vision for the future—for renewing our economy and our society. Those are some of the things that we could, and would, deliver if we had the privilege of getting into Government. It is time for change. It is time to end the misery and destruction being caused by this Government. It is time for a change in Government.
Rachel Maclean (Redditch) (Con)
It is a privilege to follow the previous speakers, and the hon. Member for Bethnal Green and Bow (Rushanara Ali). Today’s theme is making work pay. I believe that this is one of the key challenges facing our country. Conservatives believe in conserving, but what is it that we seek to conserve? In a word, freedom. As Ronald Reagan said:
“Freedom is never more than one generation away from extinction. We didn’t pass it to our children in the bloodstream. It must be fought for, protected, and handed on for them to do the same”.
There is nothing more important to the cause of individual freedom for human beings than the opportunity to work. It is the only moral way to achieve financial security. It is the path to a better life. It is not the meaning of life, but there is no meaning in life without work. It is:
“The force that through the green fuse drives the flower”,
as Dylan Thomas said.
God put Adam and Eve on Earth to work. I believe that was a wise decision, because good, hard, challenging, stressful and important work, done well, makes people happy and purposeful. It is not just a means to an end for generating taxes; the true gifts of life are to be found in the struggle on the hard road. We Conservatives are not blind to the reality of human nature. We do not pretend that people are not motivated by financial incentives. It is not selfish to want to earn more for ourselves and to work hard for it. I believe that in the Budget that was set out yesterday by the Chancellor, Mrs Thatcher would have found much to be pleased with. In 1975, she said that
“the person who is prepared to work hardest should get the greatest rewards and keep them after tax…we should back the workers and not the shirkers…it is not only permissible but praiseworthy to want to benefit your own family by your own efforts”.
How right she was in 1975, and how right we are as Conservatives to do that now.
That is why I welcome the Budget measures, especially the cut in national insurance, which will save the average worker £900, and the average self-employed worker—we have a lot of them in Redditch—£650 per year. Combined with the changes to high-income child benefit and the childcare support that we have previously talked about, the reduction in inflation, and the economy starting to turn a corner after a very difficult time, I know that those measures will be welcomed by hard-pressed families in Redditch juggling work and home life.
Of course, the welfare state and benefits are necessary in today’s world. Our fellow citizens rely on us when they are sick, or struck down by life’s blows, or cannot sustain themselves, but the pandemic has had a worrying impact, and I have seen a loosening of the links of the social contract between all our citizens as a result. We cannot ask a shrinking pool of workers to pay out of their taxes for a growing cohort of people who cannot or will not work. Benefits must only ever be a last resort for those truly unable to work—never a lifestyle choice caused by faulty wiring in our system.
It is tempting to view the Budget as a single event. It happens over a day, and there are headlines in the media. We look at it through the obsessive lens of our 24-hour news cycle and social media feeds, but we should not judge it in that way, and nor should we look at the events happening in our country as unique. We are not an outlier. Every country around the world has suffered from the pandemic, and the energy crisis caused by the war in Ukraine. As my hon. Friend the Member for Thurrock (Dame Jackie Doyle-Price) rightly said, the public are not fooled—they definitely understand and can see what is going on. They can also see that, over the course of 14 years, it is the Conservatives who have made huge strides in reversing Labour’s “something for nothing” culture. We have ensured that welfare is truly targeted at the people who really need it, meaning that we can be more generous to really vulnerable citizens.
After all, Keith Joseph first articulated the concept of the cycle of deprivation, and he set about helping people to break out of it. A Conservative Government implemented the life-changing universal credit reforms so successfully being rolled out across our country. Those reforms were conceived and led by my right hon. Friend the Member for Chingford and Woodford Green (Sir Iain Duncan Smith). That was the true genesis of the value that work must always pay.
Every time we have made reforms to welfare, the Opposition parties have howled that we are cruel and heartless. It is totally fake outrage. The true moral failure is to let people languish on benefits and not expect any better from them. That is Labour’s legacy, and we saw record levels of unemployment in every age group when they last left office, in particular among young people and women. We were prepared to take the hard decisions about universal credit. I have the scars on my back from standing here to defend the Government’s decisions at the time. But guess what? The apocalypse did not arrive.
Instead, we now see record numbers of people in work, including record numbers of women and record numbers of women over 50. Government analysis has consistently shown that universal credit is having a positive impact on labour market participation for all groups, including single parents and other vulnerable groups who face the most barriers when returning to work.
Jim McMahon
Most people who experience the benefits system will understand and support the need for a more simplified one that works around working people. The hon. Lady must also accept, however, that that was not the design of universal credit that met such opposition. The five-week wait limit before entitlement was drawn, for example, meant that people were getting into debt unnecessarily when they were entitled to the benefit earlier. She must accept that even given the principle of a simplified system, the way it was done was not right.
Rachel Maclean
I do not accept that, and I do not wish to rerun all the previous debates. The Government have listened to a lot of the issues involved in the roll-out of an incredibly complicated system, and the evidence speaks for itself. Universal credit has helped more people get into work, and work is always the best route out of poverty.
Before I move on, I will make a few comments about mental health conditions. A category of people in our country are the economically inactive, which is sad to me and many of us, because those people are fundamentally not free—they are dependent on the state. My concern is that the number of working-age adults who are out of the labour market because of long-term sickness has been rising since 2019, from about 2.2 million people then to about 2.5 million in the summer of 2022. I understand that that started before the covid pandemic.
The biggest relative jump in economic inactivity due to long-term sickness is among the under-35s, whose main complaints are depression, bad nerves or anxiety. I have two psychology degrees, and I fully understand mental illness and mental ill health. I also believe in using words precisely. I am therefore alarmed to see the conflation of the terms depression and anxiety together with “bad nerves”. Bad nerves? Both anxiety and depression are clinically recognised conditions; bad nerves is not.
Government statistics, obtained following several questions that I posed to the Department, do not break down the number of people self-reporting under each condition, and there is no data or information on how that concept of bad nerves is defined, assessed, treated, understood or prevented as a separate condition from depression and anxiety. That is because there cannot be. Having “bad nerves” is a totally meaningless phrase. No one knows what it is, so how can people decide if they are unfit to work if they have it? I have bad nerves about standing to speak in this Chamber, and my constituents have bad nerves when they are navigating the day-to-day challenges of juggling work and family. The phrase sounds like something out of a good housewife manual in the 1950s.
I simply do not believe, frankly, that bad nerves is a reason to be on sickness benefits, and yet figures from the labour force survey indicate that 1.3 million people are economically inactive due to some combination of bad nerves, anxiety and depression. We do not know how many are off because of each condition or how many are off because of bad nerves. I think it would be a good idea for the Department and the Ministers I can see on the Front Bench to understand on a more granular level what conditions are preventing our constituents getting back into work, so that we can target more efficiently the taxes of our constituents who are working hard for long hours and paying into the system, so ultimately reducing the bill.
Alex Cunningham
Did the hon. Lady detect anywhere in the Chancellor’s statement or the Red Book where he actually says, “We will put more resources into dealing with mental health services”?
Rachel Maclean
Over my time as a Member of Parliament, I have detected many statements by many Ministers on the Treasury Bench about investing in mental health services and back to work services, nationally and in my constituency. Redditch has a brand-new local mental health hub, delivered by the Conservative Government, and the Conservative borough council led by the excellent Mr Matt Dormer.
It is worth observing that a total of 2.6 million people reporting those conditions are actually in work, and that is a credit to our mission to support people back into work, which ultimately is the best way to improve their mental health. I have a concern that following the pandemic, we have possibly seen a trend to over-medicalise some of the normal ups and downs of daily life. It is almost as though it were possible to live in a state of blissful utopia and that if there were any interruption to paradise, that is a condition requiring help. That is just not true.
The struggle of life defines us and builds our character. Taking away individuals’ opportunity and responsibility to face their fears by overprotecting them is the worst way to develop resilience, as any parent knows. The human condition is a state, mostly, of pain and fear. If we are fortunate, we will experience love and happiness in some small interludes, and we must appreciate those.
I want to be very clear, however, that I do not criticise anyone who is suffering from any mental health condition —I do not—including bad nerves, whatever that is. If we have a poorly designed system with poor labelling, it is not people’s fault if they respond to the structural incentives that we have designed, but we must not have bogus, badly defined phrases and cod psychology as a pathway to a lifetime on benefits. I really hope that the Minister will return to that in the summing up.
Danny Kruger
My hon. Friend is giving a very brave and eloquent speech. Does she agree that there is a real problem with overprescription in the NHS? Doctors of people who have mental health difficulties respond too quickly with a chemical response. In fact, what would often be best is to encourage them either to work or to take part in social activities, which the Government support through the social prescribing programme.
Rachel Maclean
I thank my hon. Friend for that observation. I hesitate to agree with him definitively, because I just do not have the evidence, but I strongly agree with the basic point that we should not reach straight for the chemical solution. We should look at other solutions that are clinically much better for people, including the social prescribing to which he refers.
I could highlight many issues in the Budget that I know would be welcomed in Redditch. I have campaigned long and hard for the Alex hospital and the Conservatives have delivered an £18.8 million operating complex, now open, ensuring that we are making progress in cutting the waiting lists. People can get operations closer to home and can get home quicker, and they can have more lifesaving surgery closer to their homes. I was glad to see the emphasis yesterday on productivity gains in the NHS, as well as pouring in money. Constituents know that healthcare is expensive and valuable. Staff time and public resources must be properly stewarded and not wasted.
Yesterday, there was an unexpected but welcome announcement—a delightful one—by the Chancellor: £5 million to spend in Redditch on cultural projects. That will be massively welcomed in our area, where the arts play a huge part in our local life. I will talk to local and community groups about how we can best use that. We have plenty of potential destinations, including the Palace theatre, Arts in Redditch, our new library complex—also boosted by Government levelling-up funding—and many more.
I am particularly proud of the record of my local council, which is led by Councillor Matt Dormer, who instigated a council house building programme that has delivered 19 council houses. I always appreciate the fact that we need to go further, but that is a significant move because they are the first true council houses built in Redditch for 29 years. For all the years that it was in control, Labour did not build a single council house, even though they are much needed.
Rachel Maclean
I am glad to hear the “Hear, hear” from behind me. We all know that those council houses are a route for local families to have a decent home, put down roots, build and raise their families and better themselves through work. It is a platform for the life that they can build for themselves—that is the Conservative way.
Ultimately, I observe that, as Roger Scruton reminded us:
“A free economy is an economy run by free beings. And free beings are responsible beings.”
Our plan for work is making our country a place for free and responsible people to realise their full potential. It sets out a pathway to freedom through work, and it will make work pay. I strongly welcome it and will back it in the voting Lobbies.
Karin Smyth (Bristol South) (Lab)
Families in my constituency have felt the consequences of the Government’s political chaos and economic incompetence. Five Prime Ministers, seven Chancellors and 11 plans for growth have all left them worse off than they were 14 years ago. The Budget will not change that, and, crucially, the Government know it.
If the Conservatives had grown the economy at average OECD rates, households would be an astonishing £5,000 better off each year. That sum would make a huge difference to families in my constituency. It could have provided some financial security to them, helping them to pay their bills, support their families, and maybe even have that holiday—but no. Instead, families in Bristol South are struggling to make ends meet. Food prices are still 25% higher than they were two years ago. Rents are up by 10%. We know that people are experiencing higher mortgages as a result of the mini-Budget. The tax burden remains the highest in a generation. Working people have paid the price for the 14 years of Tory chaos.
The Government’s failure to grow the economy has gone hand in hand with the cuts to local spending that we have heard all about today. People are paying more and getting less. They are being forced to make do with struggling public services. Parents know that schools have had their per capita funding cut. People know that there are fewer police on the street. they know that bus routes have been cut. Crucially, they know when they try to get local appointments that the health service is under increased pressure. Everyone knows that they have lost out. Everyone has seen that the Government have taken resources away. Young people, families, the vulnerable —all left without vital support and local facilities after the past 14 years.
Councils of all political stripes have declared bankruptcy because the Conservatives’ piecemeal funding has failed local government. As we heard earlier, the movement of resources from local government to national Government has devastated councils’ ability to run local services. Some 900,000 people who were working in local government have moved to national Government, as we heard from my hon. Friend the Member for Oldham West and Royton (Jim McMahon).
Bristol’s Labour-run council has managed to maintain some vital services despite—not because of—the Conservative Government. As my right hon. Friend the shadow Chancellor said earlier, it is a deep irony that the Government—having taken away all those resources and, crucially, given the scale of waste and the fraud that we have seen at national Government level—are now starting to tell Bristol and other local councils how to run our local services, It is absolutely astonishing. The idea that they can start telling local councils how to run services is for the birds.
The Budget has done nothing for people in Bristol, but the council is still able to maintain basic services. We have protected the most vulnerable. There are 12,500 more homes, 14,000 dwellings have planning permission, we are on track for more affordable housing, and we are accelerating the delivery of council-owned homes. If we had a Labour Government working with that Labour council, we could really transform lives. If we were in government, we would rebuild the foundations of local government, working in partnership with councils, not against them, through long-term funding settlements to develop stronger, more secure and prosperous local economies.
To kick-start growth across the country, we need to invest in the workforce. A decline in skills and training is holding Britain back. As my hon. Friend the Member for Leicester West (Liz Kendall) announced this week, that is why we are so focused on helping people—particularly young people—back into work, giving them the chance to have a good, healthy life with new skills, specialist employment support, new careers advice and work experience, proper early mental health support and real opportunities, particularly for disabled people coming back into work.
Employers desperate for skills know that we are not training people in the skills of the future. The Tories failed apprenticeship levy has prevented employers from doing the best for young people in particular, as I saw at first hand at my jobs and apprenticeships fair last week. While £1 billion of funding from the levy goes unspent, the Budget has again failed to deliver the levy changes that are needed. Labour has listened to businesses that are concerned about the levy. Our reformed growth and skills levy will give employers greater flexibility to use their funding so that people can gain new skills and access better jobs. We need to match the skills needed in our local economy to young people in particular, but also to people who are retraining, so that we can get the growth that we need to drive better prosperity. By developing skills for the jobs of the future, we can unlock growth in the economy.
In our approach to growth, we want to grasp the green agenda. We will establish GB Energy. Clean power created right here in Britain will mean more jobs and lower bills for households. Our national wealth fund will invest in industry to fund green initiatives. People and businesses in Bristol are desperate to transform our economy and get new skills, particularly in the construction industry, to build environmentally sustainable houses, as well as in digital and cyber. Where the Tories have ignored the potential offered to us by growth in green industries and jobs, Labour will invest in our future.
Under the Conservatives, people’s living standards have fallen. Families, and young people in particular, cannot afford to get on the housing ladder. Prices in the shops have risen, and the tax burden is the highest in 70 years. Yet the Prime Minister and the Chancellor still came here yesterday full of smiles, laughing and saying, “Frankly, you’ve never had it so good.” My constituents know that that is completely false. No number of Tory Budgets can rewrite the past 14 years of economic failure and the damage that it has done to our society. People need fresh hope, a sustainable plan for growth and a Labour Government who will put Bristol and our country first.
Damian Collins (Folkestone and Hythe) (Con)
The Chancellor of the Exchequer made one announcement in the Budget statement that has not been referred to today but is relevant given the contributions made so far: the Government will sell the last of their remaining stake in NatWest bank, formerly the Royal Bank of Scotland Group. Of course, we all remember that the Royal Bank of Scotland Group, once the world’s largest bank, ran out of money and would have collapsed if not for a complete Government bail-out. It would have gone down and taken with it the livelihoods, jobs and mortgages of millions of people in this country, having an effect on the entire banking system. It has taken us nearly 16 years to get to a position in which the Government can sell their stake in the bank and return it to fully private ownership.
That is an important benchmark, because it is easy to pretend—as a number of hon. Members have tried to do—that 2010, when the Conservative party was elected, was a year zero and there were no issues from the past that we had to deal with. We came into government on the back of that banking crisis. Both parties acknowledged that the bail-out of the banks was necessary, inevitable and the right thing to do, but it came with a cost attached. It came with the recognition that the huge amount of increased Government debt required to take that stake in the banks would at some point have to be paid back, and that the massive shock to the global economy and our economy and the recession it created would lead to consolidations in public spending.
However, it was the Conservative party—working in coalition at the time—that had to put those plans in place. We inherited no detailed plan from the Labour party; no difficult political decisions were made about where spending would be cut or how debt would be repaid. That was entirely left to the Conservative party to do, and that is what we did. We fixed the roof when we had the chance to do so, and because we controlled debt and got it falling again, when the next shock came in the form of the covid pandemic—nothing anyone could have predicted or known about—we were in a position to respond. We could increase borrowing again to make the necessary decisions to protect people’s jobs and homes, create the furlough scheme and give the economy the support it needed. We could make those decisions because we had regained international trust in the British economy and in our Government, and we could borrow money to do so.
Damian Collins
I will in a moment.
Yes, borrowing has gone up, and taxes have gone up to pay for it. That is an inevitable consequence of those two massive global events that took place: one under the last Labour Government; and one under the Conservative Government in the shape of the covid pandemic. I do not remember the Labour party ever criticising the furlough scheme or the support that was put in place, or suggesting that it should not have been done.
Damian Collins
My hon. Friend is quite right: if anything, Labour wanted the lockdown to carry on longer, meaning that the debts would have been even higher. Had the Conservative party not put the public finances back in order, we would have started that pandemic with much higher levels of debt than we did. The necessary decisions were made to put the economy right.
The borrowing has gone on because of the need to pay for covid. It has been complicated by a war in Ukraine —again, I have not heard any Labour Members say that we should not have supported the Ukrainian people.
Jim McMahon
The hon. Gentleman’s speech is giving the impression—I understand why—that the world was rosy up until covid came and that the problems followed afterwards, but before covid, there were 2 million more people on the NHS waiting list than under the previous Labour Government. The NHS was in a fragile state, as was the national debt, which was over £1.5 trillion before covid hit. The hon. Gentleman cannot say that that is strong foundations.
Damian Collins
No, I did not say that at all. What I said was that we picked up the pieces of an international banking crisis, with no plan from the previous Government for how that would be paid for. It was entirely down to the Conservative party to find that money. The criticism was that the previous Labour Government were increasing borrowing before the banking crisis hit. They were already borrowing for political reasons—to sustain spending they could not afford—and then had to bail out the banks on top of that. If Members are going to criticise the past 14 years of Government, let us start where the problem started, which was before we came into power. We were required to pick up the pieces of the mess we inherited.
There are big things that happen, which require responsible Governments to take big, responsible decisions. That sometimes means that they have to put up taxes in order to pay for borrowing to get through a crisis. Let us not pretend that that is not the case, but the question is whether Governments have a serious, credible plan and whether they are prepared to be honest with the British people about what that plan entails. On the back of the pandemic, we have had to put up taxes and borrowing to pay for that. We have done that, and we are now at a decision point. As the economy recovers and the OBR projects that debt will fall, what can we do? What path should we go down? As the Chancellor has set out, the priority of this Government is to recognise that because taxes had to go up to pay for the pandemic, we want to reduce taxes when we can. We want to lift that burden from the British people and start to reduce taxes.
If any hon. Members want to come in at this point, I am happy to give way.
Matt Western
I will, because I was trying to intervene a few moments ago, as the hon. Gentleman will hopefully recall. My point was simply going to be that during the mid-2010s, there was a fantastic opportunity to invest in our infrastructure—repairing our schools and so on—when interest rates were at a record long-term low, and that opportunity was missed. Does the hon. Gentleman not regret that?
Damian Collins
I do not agree with that. Just looking at my own constituency, we have had two brand new secondary schools built, a big new special needs school, and primary schools as well. There has been investment in most school buildings, and we have seen a huge amount of investment in the infrastructure of this country. References have been made to the decision not to complete the northern leg of high speed 2. Of course, that money is not being taken out of infrastructure spending—it is just being spent on different things. That is a point that has not been made.
As the economy recovers and debt is predicted by the OBR to fall, we have a decision to make. The priority of the Government is to reduce taxes, and they have done so through the national insurance cuts made in the autumn statement and again in the Budget: a 4% cut in national insurance, and yes, a longer-term ambition that that tax may go altogether. That is not an unfunded commitment; it is saying, “That is the priority. That is the decision we would take—the direction we would go in.”
Damian Collins
In one moment. What we have heard in today’s debate—particularly from the shadow Chancellor, the right hon. Member for Leeds West (Rachel Reeves)—is that Labour would go down a different path. Labour would spend more; they call it investment, but basically, Labour would spend more. Labour’s priority is not to cut taxes. It is begrudgingly going along with the tax cuts we have announced because it does not want to oppose them, but there was certainly no statement made today that suggested Labour would seek to cut taxes.
Labour would seek to spend more, so that is the choice for the British people at the next election and moving forward: as the nation recovers from the shocks it has been through, and as the Chancellor has got the discretionary money to spend, do we give that money back to the British people? Do we let them keep more of what they have earned, or do we just spend it on their behalf? That is the classic separation between our parties, which has existed for generations. The belief to which the Labour party is still wedded is that growth is created—something that we both want to see—by the Government spending more. What has been demonstrated over the decades is that by backing the British people, and their ingenuity and hard work, we generate the growth we need. That is the separation that we see now.
The shadow Chancellor said at the beginning of her speech that she would not make unfunded commitments on spending or taxes, but she has done so today, because now that the money from the non-doms is no longer available to fund the things that Labour wanted to spend it on, there is no plan in place. On the radio this morning, she said that she would find the money; today at the Dispatch Box, she said that there would be a detailed piece of work to seek it out, but we still do not know what the plan is. The only thing the Labour party could point to today that would increase revenue is taxes on private schools, which will not pay for much at all, so we have an unfunded commitment to spend more—we do not know how; I imagine that it will be borrowing more, but it could be taxes going up—and some specific unfunded commitments. The Labour party will not say where the money will come from, but what it has said today, loud and clear, is that cutting taxes is not its priority. There has been no ambition today to say that we should cut taxes at all.
Jim McMahon
I thank the hon. Gentleman for giving way twice. He has mentioned a number of times the need to repay any debt and borrowing. He will know that part of the borrowing for HS2 was going to be serviced through the revenue from HS2 ticket sales, and through moving more freight off-road and on to rail, to be carried by the track that was freed up. Is he absolutely confident that the new transport projects, including on potholes, that will be funded by the spare capital that has been freed up will be serviced through revenue, or will that be a funding gap in the future?
Damian Collins
I am confident that the robust plan that the Government set out for spending that money on other transport projects will deliver.
What I would say about High Speed 2 in the north—based on my own constituency experience in Kent, where we have High Speed 1—is that Folkestone in my constituency has benefited enormously from high-speed rail. I believe that these big infrastructure projects deliver benefits in time that are sometimes intangible and difficult to predict at the beginning. However, for HS1, the train only goes at high speed on the high-speed line as far as Ashford. The same rolling stock then runs on the traditional railway to Folkestone, Dover, Canterbury, Ramsgate, and other places on the Kent coast. A high-speed rail service that runs at high speed on the high-speed line from Birmingham to London, but with those trains starting elsewhere in the north of England, will still deliver huge benefits in reduced journey times and attracting other investment. That has certainly been our experience in Kent, and that is why I have always supported high-speed rail for the north: I think it can deliver the same thing. I still think it will deliver big benefits for the north-west, even though the trains will only go on the high-speed line from Birmingham down into London.
In addition to the points I have made about the very clear difference between the two parties with regards to taxing and spending—whether we want to cut taxes, or put spending up—I will focus on one or two specific things. The Chancellor noted in his speech that Britain has become a global centre for television and film making. Sometimes, that is said as if it is a happy accident; that, despite the fact that people could have invested anywhere in the world, they decided through serendipity to invest in the UK. The reason that the UK now has this leadership position, which is not one that we had in 2010, is that we have invested in making it happen. We have recognised that in a highly global market, production tax credits mean that people will bring production investment to the UK, rather than taking it elsewhere in the world. That generates revenue for the Treasury—my hon. Friend the Member for Christchurch (Sir Christopher Chope) is not in his place, but that is another great example of Mr Laffer’s curve at work. When we reduce the tax burden, the investment goes up, and the revenue goes up with it.
That has had huge benefits for this country: the investment in our creative industries, the jobs that people have in studios and film production—jobs that simply did not exist before—and the fact that we remain a massive global centre for investment. We have introduced tax credits for high-end television production, animation, video games, orchestras and touring exhibitions. I was very pleased to see in the Budget yesterday that those tax credits will be extended to smaller-budget independent productions, which will massively open up opportunities for smaller film companies to attract investment.
However, the big thing we have seen is the investment in studio space. Britain rivals any place in the world for studio size, which makes it, after California, the global home of film and television. One of the barriers to further investment in studios—I am thinking of a very exciting and ambitious studio project just outside my constituency in Ashford, an investment that will benefit the whole of east Kent—is that if someone builds a film studio on derelict land, which studios are often on, the business rates cost would go up massively. Is that fair, given that the uplift was generated by massive external investment? If the Chancellor recognises that, and gives new studios a 40% reduction in business rate uplift for 10 years, it will unlock a further pipeline for investment, allow us to consolidate our global leadership, and be a huge boost for the creative sector in this country.
I want to mention nuclear technology and small modular reactors. I have a constituency interest in this: Dungeness nuclear power station is in my constituency, and it would be an ideal site for small modular reactors. The Government have launched a competition to design them, and the Chancellor is encouraging people get their tenders in. I hope that we will consider that the benefit is not just us producing the clean energy that we need for the future, but us backing British industry. A British-designed and built SMR manufacturing process in this country will meet our needs, but this could also be a fantastic export industry for Britain.
I urge the Government and the Chancellor to carry on backing this new nuclear technology, to support the design competition, and to back one of the bidders. Ideally, a British company such as Rolls-Royce would be great, but there are other excellent bidders. The Government should also support the roll-out of this technology. Through their civil nuclear road map, they have established how they intend to do that, and they acknowledge that they need more nuclear sites. As a result of the road map and the consultation on it, I hope that other sites, such as Dungeness in my constituency, will be identified where this technology can be deployed.
Huge investment in green energy and new nuclear has been delivered under this Government. In 2010, when we came into government, we still had not completed the national policy framework on nuclear energy, and there had not yet been any decision about where nuclear would go. The new fleet of power stations, and the investment —and there is a lot—has entirely taken place under this Government, which is something I whole- heartedly support.
In closing, a number of hon. Members have talked about housing, and a lot of important points were made about levelling up in the Budget, and in the statements released by Ministers alongside it. New house building is incredibly important for delivering economic growth, and growth of our communities. I was very pleased that Folkestone town centre was a beneficiary last year of a significant levelling-up investment. I encourage the Department for Levelling Up, Housing and Communities and Homes England to continue their discussions with Folkestone and Hythe District Council about backing the new garden town proposal in Otterpool Park in my constituency, which will not only deliver homes that people need, but create a great many new jobs in east Kent for the coming decades.
Matt Western (Warwick and Leamington) (Lab)
It is a pleasure to follow the hon. Member for Folkestone and Hythe (Damian Collins). I absolutely concur with his points about the creative sector; it is one of the absolute gems of the UK, and we need the concerted efforts of those not just in the Government but across the House, and the support of our universities and colleges, to ensure we have the stream of investment to deliver talent. I echo his points on nuclear development, and particularly on the work of Rolls-Royce.
If the public were listening yesterday to the last-chance Chancellor, they would be forgiven for assuming that they have never had it so good. The Chancellor conveniently forgot to mention the kamikaze Budget in September 2022, when the right hon. Members for South West Norfolk (Elizabeth Truss), and for Spelthorne (Kwasi Kwarteng), crashed the economy, forced up borrowing rates and caused mortgage market mayhem, leaving average mortgage payments £240 a month higher, and businesses struggling with higher rates of interest. The Chancellor now seems to think that we are seeing Lamontian “green shoots”, ignoring the economic wreckage wreaked by the Government’s own vain ideological vandalism after an economic experiment that cost the UK £30 billion. When I say “Lamontian”, I am of course recalling the damage of a previous Conservative Government in the early 1990s.
In his first Budget 16 months ago, the Chancellor promised a “Budget for growth”. Call me a stickler for detail, but what did we get? A recession. The Prime Minister may try to blame covid and Russia’s illegal invasion of Ukraine, but the truth is that our growth is the lowest in the G7, and there is absolutely no reason why the UK should be more affected than any of those nations. Meanwhile, Mayor Andy Street is presiding over the worst-performing region for growth in the United Kingdom. There is a pattern emerging.
I asked the Secretary of State for Work and Pensions about this earlier, and it seems that he confirmed that, nationally, we have had seven consecutive quarters of negative growth per capita—in other words, output per individual—which is further contributing to 14 years of failure, including a decade of decay. That is underlined by the fact that real incomes will be lower at the end of this Parliament than at the start. The Joseph Rowntree Foundation has found that households’ average earnings at the start of this year were £2,400 a year lower than at the start of 2021. In the 12 months to September, more people in England were made homeless than bought their first home, and the years of austerity have led to 4.2 million children living in relative poverty.
Yesterday, the Chancellor announced this year’s spring Budget, with a plan to “grow the economy”. Instead, we got a Budget of what I would view as deception, delusion and dithering. The Chancellor did not address any of the urgent issues facing the country right now. It was as though he was rearranging the deckchairs on the Titanic. There was nothing on reinforced autoclaved aerated concrete in schools, hospitals and our universities, nothing on dentistry, nothing on the contaminated blood scandal, and nothing on the Post Office Horizon scandal.
Yesterday’s Budget was more an act of smoke and mirrors. The Chancellor claimed that GDP had risen, that growth was on the up, and that taxes were falling, because he wants to set October 2022 as year zero. However, the public know differently, because they have seen 24 tax rises and are feeling the highest tax burden since world war two. The Resolution Foundation has found that tax rises of around £20 billion were introduced in the last year, and that the Government have a further £17 billion of tax rises set to come into effect immediately after the general election. Meanwhile, unprotected Departments such as the Home Office, the Ministry of Justice and DLUHC—local government—will, by 2028-29, face a real per capita spending cut of around 18%. Likewise, the Ministry of Defence will face major cuts.
The Government must be honest about their mistakes. They have to be realistic about the state our country is in, and they must address these issues with long-term solutions. Instead, what they presented us with yesterday was, to put it simply, weak. It was weak on energy prices, which continue to dominate household bills. The Chancellor’s extension of the windfall tax to 2029 fails to address the fact that 6.5 million households, including tens of thousands in my constituency, were living in fuel poverty in October 2023. Meanwhile, British Gas’s profits increased tenfold to £750 million last year. I am afraid that the Government are not doing enough.
The Budget was weak on the housing system, which is broken. The Chancellor offered nothing for those on low incomes in the shape of social rent properties, which are so needed in areas such as Warwick, Leamington, Whitnash and the villages in my constituency. The Government are yet to meet their target to build 300,000 new homes in England. Meanwhile, the Chancellor’s solution was to scrap tax breaks for owners of holiday let properties. I agree with that, but it is not enough. Despite the OBR forecasting that real household disposable income per head will fall by 1.5% in 2024, the Chancellor has offered an extension of just six months to the household support fund. That is not enough. The private rental sector is breaking, and people are broken.
The Government are weak on finding long-term solutions to these issues. Overnight we learned that the Chancellor has offered £46 billion of unfunded tax cuts. Once again, the Conservatives are gambling with the public finances and economic stability. They cannot make these promises lightly; we saw the impact of that 15 or 16 months ago.
The Government are weak on supporting the needs of motorists. A paltry £50 a year in potential saved fuel duty pales in comparison with the Government’s insurance premium tax take, based on the astronomic increases in insurance premiums. The insurance premium tax was another tax introduced by a Conservative Government. Meanwhile, 23,000 car drivers a year are making insurance claims for damage from Government potholes. More parochially, I was interested to hear that Warwickshire County Council will receive a devolution deal, though no detail was provided on what that means for the leadership of our area. That is of concern, because the county council is already unable to fulfil its obligations. I will follow that proposal closely.
Elsewhere in his speech, the Chancellor claimed that the Government are doing a great deal for small businesses, yet last year the Office for National Statistics reported that more than 27,000 more businesses closed than opened in the UK. The Federation of Small Businesses’ latest quarterly survey shows that a greater proportion of small businesses expect their performance to worsen over the coming year than expect it to improve. The Chancellor’s increase in the threshold at which small businesses have to register for VAT does not compensate for the seven years for which the threshold has been frozen. Again, it is not enough.
Business investment is faltering. Interest rates are sticky, at a base of 5.25%, although they are likely to fall, just marginally, later this year. That ensures that the UK’s already woeful productivity remains worse than that of all our major competitors. For years, successive Conservative Governments have rejected the need for an industrial strategy. Although I welcome the Chancellor’s investment in life sciences yesterday, the Government are failing to harness the extraordinary power and innovation of our higher education sector. Labour will do better.
Despite all that, the Conservatives still claim that they have done a good job. It concerns me that they may believe that. We have suffered 14 years of them putting their party first and our country second. We have suffered 24 tax rises, while ordinary people struggle to pay their mortgage, put food on the table, get GP appointments and register with non-existent NHS dentists. They are struggling in Rishi’s recession—a Prime Minister who floats loftily above us in his chopper, burning up taxpayers’ money, contactless with the people below. I am afraid that the public view this Government as out of touch, out of ideas and in denial about how they have let our economy go into recession, our schools, hospitals, universities and infrastructure crumble, and our people suffer. They do not feel the cost of that failure, but the rest of us do.
The people want change. They have lost confidence in the Conservatives and they look to Labour—a changed party—to bring stability, strategy and sense to the governance of this country. The country is scarred by 14 years of failure that have spawned a decade of decay. Labour will reduce NHS waiting times and introduce emergency dental appointments and free breakfast clubs. It will establish GB Energy for cheaper, cleaner renewable energy, an industrial strategy council and a national wealth fund, and it will close the energy windfall tax loopholes. That is what the country needs and the public want. They want to see their doctor. They want an NHS dentist in their community. They want their schools to be fully open, and they want their roads resurfaced.
The public will see through the Government’s attempt to steal Labour’s clothes; evidently, they do not quite fit the Prime Minister. First, they borrowed our suggestion for a furlough scheme. Then it was our NHS workforce plan, followed by a watered-down version of our windfall tax. Now, they are hijacking our non-dom tax. However, they remain silent on climate change and the need for a green new deal. We need a plan, a project and an ambition. Let us look to what Biden is doing in the US, and the growth that the US is enjoying of 5%; it is right up there with China and India. Where are we? Flatlining at 0%.
The Government have had more resets than my broadband router, and are even more unreliable. The public are disconnected and tuned out. They do not want to wait a minute longer. For the sake of the great British people, let us have a general election, and may it be on 2 May.
Sir Geoffrey Clifton-Brown (The Cotswolds) (Con)
I am delighted to have caught your eye in this important Budget debate, Madam Deputy Speaker. I am also pleased to follow the hon. Member for Warwick and Leamington (Matt Western), although I disagree with almost every word he said. That is the nature of this place —we are entitled to debate these matters.
I have listened to the speeches from Opposition Members today. Both they and most of the financial commentators who have criticised the Budget—I totally agree with my hon. Friend the Member for Folkestone and Hythe (Damian Collins) on this—have failed to mention that we have been through two catastrophic world shocks: namely, the pandemic and the unexpected war in Europe, in Ukraine. They have had catastrophic effects on our economy. I ask all the Opposition Members who have criticised the Budget this: would they not have spent the money on the furlough scheme or the business loan scheme? Would they not have helped people out with energy loans? Of course they would have, so they would be in exactly the same place as we are, grappling with today’s economic problems.
A number of measures in the Budget are to be warmly welcomed, and I will come to one or two of them. I am particularly pleased that inflation has come down from a high of 11.4% to 4% today, and it is forecast to be below the Bank of England’s target of 2% by the end of this year. That is the most important thing we can do for the cost of living of all our constituents, above all tax reductions or anything else. I warmly welcome that. I will turn to some of the individual measures in the Budget, before moving to public sector productivity measures. After that, as my hon. Friends on the Front Bench will not be surprised to learn, I will mention the tourist tax.
My constituents will welcome a number of measures set out in the Budget, particularly the cut in employee national insurance contributions. Taken with those of the autumn statement, they amount to £900 for the average working person in this country earning £35,000. I suggest to everybody across the House that that is a significant increase in the take-home money that our constituents will see in their pockets today. That, combined with the number of our constituents who are self-employed—a particularly important and growing sector—means £650 for someone earning £28,000, which is also warmly welcome. That will encourage our hard-working constituents to work longer hours and become more productive.
As my right hon. Friend the Chancellor said yesterday, national insurance is a double tax on working people. National insurance combined with income tax is an unfair tax arrangement for working people. If we are to start making tax cuts, which I hope we will, it must be right to try to drop one or other of them, and that is why I warmly welcome the cut in national insurance.
Sir Geoffrey Clifton-Brown
Let me make one important point, which I hope the hon. Gentleman will consider when he intervenes. Yesterday the Chancellor said that, through our tax cuts and by raising the personal allowance, the tax on ordinary working people today is at its lowest level since 1975, and possibly since the war, although we do not have records to prove that. It is lower than in America, France, Germany or any G7 country. The ordinary working person’s tax burden through national insurance and income tax is extremely low at the present time.
Stephen Kinnock
It is clear that the tax burden is actually the highest it has been in 70 years. The hon. Gentleman raised a point about national insurance contributions. I assume that he has seen the email that the Chancellor of the Exchequer sent to all Conservative party members, making it clear that the plan is to scrap NICs in the next Parliament. Does he accept that that is the Government’s plan, because it is in that email in black and white? Does he also accept that that would leave a £46 billion black hole in the public finances?
Sir Geoffrey Clifton-Brown
I think the hon. Gentleman is misrepresenting what my right hon. Friend the Chancellor said yesterday. I have Hansard here. I cannot look through it quickly enough to give the exact wording the Chancellor used, but he basically said that when the economy is in a fit state to so do, and when economic conditions allow, such a move is an ambition—that is not a promise or a commitment to anything at all; it is just, as my right hon. Friend said, a commitment to travel.
Sir Geoffrey Clifton-Brown
I will give way to the hon. Gentleman, but I hope he is not going to misrepresent what the Chancellor said. I will have to get it in Hansard, but I will give him one more chance.
Stephen Kinnock
As the hon. Gentleman will be aware, I am an avid reader of the Chancellor’s emails to Conservative party members. He states:
“We want a simpler, fairer tax system where you only pay tax once. If we stick with our plan that’s working, we’ll be able to make progress towards that goal in the next Parliament.”
If that is not a commitment to scrapping NICs in the next Parliament, leaving a £46 billion black hole—why do they not just own up to it, and then explain how they are going to fill that black hole?
Sir Geoffrey Clifton-Brown
I am grateful to the hon. Gentleman for intervening a second time, because I now have the exact words from Hansard. The Chancellor said:
“When it is responsible, when it can be achieved without increasing borrowing, and when it can be delivered without compromising high-quality public services, we will continue to cut national insurance as we have done today, so that we truly make work pay.”—[Official Report, 6 March 2024; Vol. 746, c. 852.]
I do not think it is as the hon. Gentleman is saying. I think he is misrepresenting the words of my right hon. Friend the Chancellor, and I hope he will not persist with that line of questioning.
Jim McMahon
I think we can all recognise a Conservative campaign headquarters rebuttal on its own Chancellor when we hear it. The substantive point was that the NICs cuts mean there is a lower tax burden, but we must be clear for the record that that is not correct. This is the highest tax burden since 1948. The hon. Gentleman must recognise that freezing the personal tax allowance has a significant impact on all taxpayers.
Sir Geoffrey Clifton-Brown
Again, I hope we will not have my right hon. Friend’s welcome ambition to reduce national insurance traduced in the way that it has been. I do not think we will get very far by continuing that argument. Indeed, you will probably reprimand me, Madam Deputy Speaker, if I go too far down that rabbit hole.
I was going on to say that it is not just workers, through the reduction in national insurance, who will benefit from this Budget, because of course pensioners will too. Pensioners will see a significant increase in their pension through the triple lock of a huge 8.5% this year. Together with the enormous rise in the personal income allowance that we have introduced over the years, from £8,500 to £12,500, that will affect not only those on the basic state pension but also those who earn a little bit of income on top. They will see that our measures have considerably benefited the amount that they receive in their pocket.
Moving on to our commitment to families, we recognise the importance of easing the financial strain, especially for parents. I have listened closely to those constituents in the Cotswolds who have contacted me about how they have had to tighten their purses since the covid pandemic, when so many found their work interrupted, as well as about the cost of food and energy price rises in the years following. People in rural areas will be particularly pleased to see another freeze on fuel duty, because they rely very much on having to use their cars.
I am pleased that the threshold for the high-income child benefit charge has risen from £50,000 to £60,000. It will directly impact nearly 500,000 families, providing an average boost of £1,300 per household, empowering families and ensuring that every child has the support they need to flourish. I welcome the British ISA, which allows for a £5,000 investment. It should have been more. I also welcome the incentivisation of nuclear investment assets. Rather than hitting savers, we bolster economic resilience and pave the way for a brighter future for generations to come. I welcome the disclosure moves for local government pensions that will encourage investment in UK infrastructure projects.
Our commitment to families and businesses remains unwavering, from child benefit to increasing VAT registration from £85,000 to £90,000. That should have been more, but it will help a number of businesses.
Stephen Hammond (Wimbledon) (Con)
One of the key measures yesterday, alongside what happened in the autumn statement, was the extension of full expensing relief to leased assets, which will drive up growth. Growth is now even tracked. As a percentage of GDP, business investment is now the highest it has been for many years, substantially higher than in the whole time Labour was in power.
Sir Geoffrey Clifton-Brown
My hon. Friend is entirely right. The Chancellor’s announcement in the autumn statement of £10 billion for full business expensing was one of the most important economic announcements of this entire Conservative Government. He is trying to address the problem of leasing that my hon. Friend just asked about. That is contained in the Red Book and the Chancellor is now looking at that important piece, so I welcome my hon. Friend’s intervention.
Before I turn to public sector productivity, let me put it in context. Paragraph 2.14 is one of the most important paragraphs in the Red Book. It says that over the next 25 years, growth will be at 1.7% but spending will be at 2.5%. That is unsustainable and every Government in the next 25 years will have to address that. When average growth is 1.7% and health spending in modern, civilised countries like ours is growing at 4%, that too is unsustainable. So we have to do something to address public sector productivity.
From my role as Deputy Chairman of the Public Accounts Committee, I know that one of the quickest and easiest ways to deal with that is to increase the use of digital methods, as the Committee found when we visited Denmark. The Danes have their health service properly digitalised and they are a long way ahead of the NHS. Everything from booking patient appointments, patient experience in hospitals, procurement of equipment and medicine, and everything to do with the health service is digitalised. It works incredibly efficiently. That is why I welcome the £3.4 billion for NHS digitalisation. Such investment in productivity can yield huge dividends in future outputs.
It is not just in the health service where digitalisation can have an impact. The Secretary of State for Levelling Up, Housing and Communities is currently consulting on a relatively small investment in the digitalisation of the planning system. Every business, everywhere, wanting to do anything, complains about the slowness of the planning system and that local authorities do not have enough planning officers. Digitalisation will cut some of the bureaucracy for planning officers, allowing them to take better and quicker decisions. It will help productivity enormously and have a huge knock-on effect for businesses.
As I promised the Minister, I will now turn to tax-free shopping—he would be disappointed if I did not mention this subject as there was disappointment that there was very little mention of it in the Budget. There is a small mention in the Red Book and the OBR has produced a separate report, which I will come to shortly. In the debate on the autumn statement, in response to an intervention I made, the Chancellor said:
“We changed policy on this issue a year ago because it cost around £2.5 billion a year and we did not think we could afford to continue it, but we are looking again at the numbers in the light of the most recent data and we can see what has happened to comparative shops in Paris and Milan. We will review this to see if it is still that expensive, and I hope that it is not.”—[Official Report, 22 November 2023; Vol. 741, c. 349.]
Yesterday’s OBR review was not a full review. All it did was review its very limited 2020 forecast and its own figures, with no reference to how badly the UK is performing relative to our continental competitors. The OBR made no mention of the costs and benefits to the Exchequer of extending the scheme to EU visitors, and the OBR has never been asked to look at that.
I give the Government credit where credit is due. We have a new doctrine in the OBR, and it starts to address some of the points that my hon. Friend the Member for Christchurch (Sir Christopher Chope) was making. The Chancellor said that
“if we reduced the higher 28% rate that exists for residential property, we would in fact increase revenues because there would be more transactions. For the first time in history, both the Treasury and the OBR have discovered their inner Laffer curve.”—[Official Report, 6 March 2024; Vol. 746, c. 849.]
If they can do it for the cut in capital gains tax, why can they not do it for the reintroduction of the tourist tax?
I will acquaint the House with one or two figures, because I have some figures for what is going on in the real-world economy. If the Minister will bear with me, I am not sure the Treasury is truly taking them into account. When he and the House hear the figures, they will begin to think we should be investing in this. First, let me refer to two independent reports. One is the well-respected and well-renowned forecasting by Oxford Economics, which predicted that restoring VAT RES—the VAT retail export scheme or, colloquially, the tourist tax—could increase GDP by £6 billion. Another report predicted £7 billion. We are dealing with huge stuff here, and a potential huge benefit, so I cannot see why the Government will not at least do a proper study.
We know from our figures that British businesses lost out by £1.5 billion in 2022 and by even more in 2023. The measure would benefit many of our big retailers, hospitality venues, airports and cultural destinations, particularly tourist destinations, such as the Cotswolds. The report also shows that Britain is losing out on a £10 billion EU market, and that the measure would give the Exchequer a net benefit of £500 million in VAT alone.
The figures on how we compare with our competitors are stark. In 2022, spending by American visitors to Britain was at 101% of the pre-covid level of 2019, but guess what? In France, it was 226%. In Spain, it was 206%. In Italy, it was 190% of pre-covid levels, as compared with our level pegging with the situation pre-covid. This is big stuff, and I cannot understand why the Treasury will not study it properly. In 2022, spending by visitors from the Gulf Co-operation Council states in Britain was only at 65% of 2019 levels, but it was 198% in France, 158% in Spain and 166% in Italy. Those are not my figures, but figures from real traders that have given the Association of International Retail their actual figures audited from their books. They are not made up. I gently suggest that the Chancellor and the industry—industry would fund it, if necessary—jointly commission a proper independent study into the full impact of tax- free shopping on British businesses, the economy and the Exchequer, so that we can have a real evidence-based decision on this huge and important area. Will the Chancellor meet me and industry representatives to discuss it further?
I am delighted that we have seen inflation fall from 11.1% to 4%. Wages are rising, mortgage rates are starting to fall and interest rates will hopefully fall towards the latter end of this year. It has been a tough few years. Pandemics and wars cause economic strains that few countries have managed to avoid. I was vocal last year on rising energy and food prices, which are a regressive cost hitting low earners the most. I am pleased now to see the cost of living easing.
The people of The Cotswolds want to see their hard work pay, the innovation of small and medium-sized businesses encouraged, and public services such as schools and the NHS well funded but operating efficiently. However, those services can improve only if our economy is strong and thriving and the UK is seen as the best place to do business. That is why I am so pleased that yesterday my right hon. Friend the Chancellor’s Budget covered so many world-leading sectors, including the creative economy, unicorns, artificial intelligence, and the financial and pharmaceutical sectors. We have much to be proud of in so many sectors, and the Chancellor did a lot yesterday to encourage every single one of those businesses, with their innovation and energy. I commend his Budget.
Several hon. Members rose—
Madam Deputy Speaker (Dame Eleanor Laing)
Order. Before we proceed, I hope that we can manage the rest of the day without having a formal time limit, but approximately 90 minutes is left for Back-Bench contributions, so I hope that Members will take about nine minutes each. That is quite a long time—it is not curtailing debate to take nine minutes or so each—and if we can do that, we will not need a formal time limit. If we cannot achieve that by simple courtesy and arithmetical calculation, I will impose a formal time limit.
Chi Onwurah (Newcastle upon Tyne Central) (Lab)
Thank you, Madam Deputy Speaker; I shall of course be guided by you.
It is now almost 14 years since I first had the immense honour and privilege of being elected to the best job in the world—Member of Parliament for Newcastle Central —but over those 14 years it has been heartbreaking and outrageous in equal measure to see the consequences for my constituents of Tory economic failure. First, we had austerity: the cruel gutting of communities, public services and jobs, which dampened growth instead of driving it. Tory austerity is why the Resolution Foundation tells us that the average wage will not return to its 2008 level until 2026.
We then had covid: a global pandemic, but one that disproportionately impacted the very communities—the poor, the black and minoritised, the unwell and infirm, and the disabled and disadvantaged—which austerity had undermined and weakened, while straining our NHS to breaking point, yet members of the Conservative Government saw it as an opportunity to help their mates get rich. My hon. Friends in the Opposition have destroyed the fake Tory fig leaf that everything was rosy before covid.
Then we had a cost of living crisis made in Downing Street, with energy and food prices, mortgages, rents and transport costs all soaring. The Budget was the Tories’ last chance to try to repair the damage they had done and stop the rot, and what did we get? More of the same failed economic policy that has plunged us into recession.
My constituents work incredibly hard to provide for themselves and their families, and local businesses are also working hard through the Tory economic gloom. We can see that in our fantastic start-ups, spin outs and scale-ups and Newcastle’s world-renowned hospitality sector, which offers so many from all over the world a great Geordie welcome as well as adding £361 million of gross value added each year to my constituency. I note that UKHospitality said that the Budget offered little for this sector with so much growth potential.
Labour Members believe that work should pay; the Tories’ broken economic model increasingly means that, too often, it does not. The average person in the north-east is £11,500 worse off since 2010 than if the economy had grown at the rate it did under Labour. Shamefully, child poverty across the north-east of England has climbed by more than a third since 2014-15 according to the End Child Poverty coalition. Increasingly, those children’s parents are in work. The North East Child Poverty Commission found that the proportion of north-east children in poverty who are from working families has risen from 56% to 67%—more than 10 percentage points—in under a decade. I put on record my gratitude to both those organisations and to other researchers for their work. I only wish that the Government would take their evidence as seriously as it demands.
Madam Deputy Speaker, I would like to wish you and all women, as well as our allies, a happy International Women’s Day for tomorrow. I also want to highlight the particular struggles of women in my region. Our economic troubles and the running down of public services have meant that many Geordie women face spiralling problems with debt, poverty and housing and are struggling to access mental and physical healthcare. In its recent report, Changing Lives, a charity working with vulnerable women in the north-east, found that
“women living in the North East are more likely to live shorter lives, to spend a larger proportion of time living in poor health, and to die prematurely from preventable diseases.”
At-risk women in the north-east are 1.7 times more likely to die early as a result of suicide, addiction or domestic murder, compared with the average for England and Wales.
That is just a disgrace—a Tory disgrace—and it perfectly demonstrates the human cost of bad government. If we had had Labour’s workforce plan in place, the NHS back on its feet and able to provide consistent, high-quality care and productivity improvements, Labour’s new deal for working people to give people security in work, and action on housing, poverty and bills, the difference that that would have made would have been life-changing and lifesaving.
I was disappointed to hear nothing in the Budget about the Government’s approach to the loan charge scandal. A constituent who retired after a lifetime of hard work is being bombarded with letters from HMRC threatening him with retrospective demands and a possible bill of £50,000—we can imagine how he is enjoying his retirement. The issue absolutely needs an independent review.
The Chancellor and the Government have failed my constituents, failed to make work pay and failed to get the economy growing. The tax burden is at a 70-year high, so I of course welcome the cut to national insurance contributions. However, Rishi’s tax double take means that households will be £870 worse off on average.
I also welcome the new devolution deal for the north-east, but my constituents would be much better off if the Conservatives got the basics right in our economy, providing the vital change we need in housing, energy, industrial strategy, transport and so on. The North East Mayor, who will be elected in May, will have a difficult job to fix the Tory’s mess. Fortunately, Kim McGuinness, our excellent Labour candidate, is determined to hand power to our communities and to create real opportunity for everyone who lives in the north-east, and a Labour Government would be the partner she needs.
This Budget has been determined by politics and by attempts to manage Tory divisions and to desperately save the skin of Tory Members, instead of doing the responsible thing. Look at the way the Government have adopted some of the Opposition’s proposals on non-dom tax regimes—not as part of a long-term plan, but because they have been bounced into it.
My constituents do not care about Tory infighting; they are sick of it. They want to see real action to kick-start our economy through stability, reform and investment. That is what Labour is offering. Our industrial strategy would bring together our excellent universities across the north-east, our skilled workforce and our deep capital markets to turbocharge growth in constituencies such as mine. In fact, we have a plan for the life sciences —“A Prescription for Growth”, which I highly recommend —to help grow the economy and get the NHS back on its feet.
Labour would support businesses in Newcastle through our plans on business rates, skills and the planning system and would get Britain building again. We would bring bills down by switching on Great British Energy, a new British company that will create new, high-paid jobs across the north, reduce bills and leave us less dependent on tyrants such as Putin.
This morning on Radio 4’s “Today” programme, the presenter interviewing the Chancellor set out just some of the facts and figures that demonstrate Tory economic failure. The Chancellor responded by saying that such a characterisation was unworthy of the BBC—well, he had just been called “the fiscal drag queen”, which clearly annoyed him, but that is no excuse for saying that facts, figures and evidence are unworthy of our national broadcaster. The Government would do better in reminding their Ministers—in particular the Secretary of State for Science, Innovation and Technology, whose libel bill the taxpayer has just paid—that facts matter.
Labour’s evidence-based, mission-driven Government would give the people of Newcastle upon Tyne Central our future back. Yet again, this Budget will only hold them back. We need a general election, and a change of Government.
Danny Kruger (Devizes) (Con)
I have enjoyed the debate, which has been useful; we have heard important contributions from both sides and I welcome the constructive tone. However, I do think that the comments just made by the hon. Member for Newcastle upon Tyne Central (Chi Onwurah) reflect a Labour party committed to ever-increasing public spending while simultaneously complaining about the high tax burden that the country labours under. That comes without any commitments to reduce taxes further than we are—in fact, the party just makes ever-increasing spending commitments.
Chi Onwurah
When did I ask for increased spending? Will he clarify that now, for the benefit of the House?
Danny Kruger
Well, we heard repeated complaints about the underfunding of services and the requirement for improvements. That is what the hon. Lady believes in. If she is happy to say that she does not believe in additional spending, I will be delighted to hear it.
Chi Onwurah
I thank the hon. Member for giving way again. As he knows, we have set out our spending commitments, and crumbling services are a consequence of the Tories’ absolute failure to give growth to our country and our fantastic businesses, which can drive economic growth across our country.
Danny Kruger
We have made repeated investments in public services, but I recognise that there are all sorts of problems across our country. On the subject of crumbling, there is also a major hole in the Labour party’s public finance plans following yesterday’s Budget. We look forward to seeing how it will plug the new hole in its plans.
I made the remarks because I think there is a common recognition across the House that improvements need to be made to our economy. There have been significant challenges to the UK in recent years. I was pleased to hear yesterday that significant improvements are now under way: inflation is falling, wages are rising, mortgage rates are starting to come down and debt is on track to fall. All that is welcome.
I also very much welcome the combination of the autumn statement and yesterday’s Budget, which together have seen cuts to national insurance totalling £20 billion, benefiting the average worker by over £900, and a tax cut of around £650 for the average self-employed person. I recognise the points about fiscal drag; we have to acknowledge the reality there. But given that the thresholds have not been raised, the tax reductions are welcome.
I particularly welcome the changes promised for the high-income child benefit charge by the raising of thresholds and halving of the rate at which child benefit is withdrawn. That important step will benefit some families by an average £1,260. That is welcome, as is the commitment to end the unfairness on single-earner families altogether by April 2026. I welcome those significant developments.
I particularly welcome the extension to the household support fund. I have been calling for that on behalf of Wiltshire Council, to which I pay tribute for its really good work in supporting households in need with essentials such as food and utilities. That extension is a really important development. The Chair of the Work and Pensions Committee, the right hon. Member for East Ham (Sir Stephen Timms), made the interesting suggestion that the household support fund should be made permanent. I recognise that there are voices on my side of the House who think that it is only a sticking plaster measure during these difficult times. I actually agree with the Chair of the Select Committee: it is important to ensure that local authorities have discretionary funding that they can use. They should be accountable to their local residents for how they use that money. I would like to see the money raised locally as well, but the principle of a discretionary fund for local government is important.
There are obviously still significant concerns about the state of the economy, and I am somewhat concerned by the obeisance and genuflection that the Chancellor feels obliged to make towards the Office for Budget Responsibility. I recognise that he would have liked to have done more in the Budget if the OBR had allowed him. It is the wrong way round to outsource responsibility for fiscal forecasting to an unaccountable body in this way. It is wrong that he regards the only measure of the Budget’s success to be whether the OBR gives it a green light. Fundamentally, we are restricting the reforms that we need to make in this country.
I come to a broader concern. I welcome the Budget, and all its measures are good and helpful, but there remain profound and powerful structural problems with the model of our economy, all of which started before we came into power. It is a cross-party responsibility. The Liberal Democrats, the Conservatives and Labour are all responsible for the structure of the economy under which we operate in this country, and I will describe it briefly in the following terms. We have had cheap money and decades of artificially low interest rates, followed by money printing from the Bank of England that went on too long, creating chronic asset inequality in our country. Essentially, there has been a transfer of wealth from poor to rich. We have had cheap labour, creating low wages, and we have pressure on housing, public services and community cohesion that has been caused by importing millions of people from abroad to work for low wages in our economy. We have an economy built on cheap imports: we burden our own producers with costs while we import cheap products from abroad that are made to lower standards. I regret all these conditions in our economy.
The result is huge geographic inequality, a long tail of unproductive businesses and, I am afraid, too low real-terms wage growth. I suggest that all this is endemic to the economy, which was made by Labour and the 2008 financial crisis, but which has not been sufficiently addressed over the last decade and a half by the Conservative Government. We fixed the damage that was done to the public finances under Labour—imagine what the party would have done if it had been in power after 2010—but we did not change the economic model.
I am glad the Budget indicates that the Government are committing to reforms in the right direction. I particularly welcome the recognition that debt will fall during the next Parliament if we are in charge—it is impossible to see how the Opposition will get debt falling without policies to drive growth and improve public sector output. That is a good commitment. I also welcome the commitment to improve public sector productivity, and my hon. Friend the Member for The Cotswolds (Sir Geoffrey Clifton-Brown) made some very important points about the way in which we need to improve output and efficiency in the NHS. I particularly welcome the Government’s focus on improving private saving and investment.
I want to quickly mention the Wiltshire economy. In my wonderfully beautiful, traditional and old-fashioned- looking county, we have some of the most hi-tech businesses in the UK producing really innovative products for the global economy. A highly positive story is developing in Wiltshire, led by the agritech sector. One of the great benefits of our new Brexit freedoms is that we can liberalise and enhance the opportunities for biotech and agritech, but we need more, and I will quickly run through what they are.
First, I welcome the minor uplift of £5,000 in the VAT threshold for businesses. I regret that we could not do more, and I particularly regret that the reason we could not do more is, as I understand it, due to the Windsor framework. We are effectively tied into the EU’s VAT regime, because we do not want to diverge from Northern Ireland in GB—quite rightly—but I regret that we could not raise the VAT threshold to significantly more than £90,000. We should find a way to make that possible.
Secondly—other hon. Members have made this point powerfully—we need to grow our rates of house building significantly. I would like to see more new towns being created. I would also like to see land reform to get the cost of land out of the price of housing, which seems to be the fundamental blocker, particularly on housing in rural areas. We should greatly enhance and expand community land trusts, which have such a useful role to play not just in urban settings but in rural settings, to create low-cost, affordable housing for local families.
We also need to reform the labour market. Today’s debate on enhancing the world of work is so timely and relevant to the reforms that the Government are trying to bring about. I welcome all that the Secretary of State for Work and Pensions, whom I met this week, is doing to get more people into work. We have a chronic problem with economic inactivity. Significantly, millions of people are not able to contribute to the economy and to their own prosperity. There are major disincentives to work and train, fuelled by our high-migration economy, which is simply a subsidy to employers at the expense of working people.
It is very good that the Government are focusing on GDP per capita, which is the fundamental measure, despite the poor record of GDP per capita in recent years, as Opposition Members have pointed out. There are many reasons for that poor record, but the primary reason is the high rate of migration. Low-paid workers have driven down contributions and income per capita. I welcome the work that the Government are doing to get people off benefits and into employment, particularly through the WorkWell programme.
I finish with a plea on behalf of Wiltshire and the whole country. More than anything, I regret the Budget’s slow and frankly insignificant uplift in defence spending. It is a good thing that more money is now going into the defence budget, and I welcome the commitments that have been made in recent Budgets, but the increase of less than 1% in the defence budget yesterday was disappointing, given the current global crisis and the historical underfunding of our armed forces under many Governments. I am proud to represent the British Army’s largest garrison, on Salisbury plain. It would be a great thing for the nation and for Wiltshire to see the significant investment in the Army that will be necessary for our security. It would also boost our economy.
Several hon. Members rose—
Madam Deputy Speaker (Dame Eleanor Laing)
We will try an eight-minute formal time limit, which does not prevent Members from taking interventions.
Steve McCabe (Birmingham, Selly Oak) (Lab)
Listening to parts of this debate, I wonder what universe some Conservative Members have been occupying for the last four years. In fact, I wonder whether someone has been slipping soma, or something, into their tea. The House will recall that soma is the magic potion that is fed to the characters in the Aldous Huxley novel “Brave New World” to quell their unhappiness and blind them to the realities of life around them. That is how it feels listening to parts of this debate.
Try as they might, this Government cannot escape responsibility for the state of our economy, the cost of living crisis and the damage they have done to family budgets and to the people they have plunged into debt. In my pre-Budget survey, Selly Oak constituents were clear: 93.3% wanted the Chancellor to prioritise the cost of living crisis—he has not; 70.7% wanted him to concentrate on growing the economy—he has not; and 67.7% were against apparent giveaways followed by public service cuts—that is exactly what he has done.
This is not a tax-cutting Budget because, as we have heard, tax is still going up. The Chancellor is presiding over the highest level of tax for 70 years, and he has the effrontery to prance around pretending to be a tax cutter. He is a bit like a Prime Minister who professes a love for equality while boasting of transferring funds from poor areas to rich areas.
People are not stupid. They know that the continuing freeze on allowances means that they are paying more. People like teachers and nurses are now paying higher rate tax and, since the Tories came to power, the average income tax paid by pensioners has risen, with 1 million more sucked into the tax system in the last year.
And, of course, there are the hidden costs. A prudent Chancellor would have put something aside for the contaminated blood scandal, the victims of the Post Office Horizon nightmare, the WASPI—Women Against State Pension Inequality Campaign—women debacle and the LGBT ex-service personnel. Those are all things that he should have sorted by now but has ignored, probably deliberately. Perhaps he is planning to leave those issues for someone else.
If the Chancellor wanted to grow the economy, he would have done more to help small business. For example, Attic Brew in my constituency is a popular little business that, having weathered covid, has created about 40 full-time and part-time jobs, but it struggles with high energy bills and taxes, which hit sales of locally produced beer. I acknowledge the alcohol duty freeze, but he did nothing about energy bills or reducing duty on draught beer and cider, which would have done far more to help small independent producers. That is how to reward work and enterprise.
Growing our economy is the only way to get enough money to pay for good public services. Where in the Budget was the support for skills investment, which is essential if we are to grow and provide jobs for the future? I heard Conservative Members laugh yesterday at the idea of GB Energy, just as they used to laugh at a non-dom tax. GB Energy will allow us to take control of our energy sector and protect us from hostile powers, and will help to wean us off fossil fuel. Labour knows the value of that, because we have done it before. When we created the British National Oil Corporation, we created a structure that could have rivalled the Norwegians for providing dividends and a sovereign wealth fund for our people, had not the Tories squandered the proceeds of North sea oil receipts. They understand the needs of oil giants, but they show little understanding of, or care for, the needs of ordinary people and small business.
Finally, we have seen the classic Tory deception. The Chancellor ended his Budget speech by planting a story about something that he will probably not do. He wants us to talk about the total abolition of national insurance, an unfunded proposal worth more than the tax bonanza from the right hon. Member for South West Norfolk (Elizabeth Truss), which almost wrecked our pension funds. Of course, that assumes that he is promising to scrap only employee NI. If he were also considering employer contributions, we would be talking about a black hole of not £46 billion, but £178 billion. We can see why we need clarity from these people about what they are actually promising.
Stephen Kinnock
My hon. Friend is making an excellent speech. Does he think that it is extraordinary, given what happened after the so-called mini-Budget, that the Conservative party seems to have learned nothing and is still making all sorts of unfunded commitments, which could wreak havoc on our economy, just as happened last time around?
Steve McCabe
This is extremely serious, and I am not surprised that the Conservatives are trying desperately to get away from it, because we can all see the risks that are posed.
This is a Budget based on the kind of fantasy reality that could well have come from an Aldous Huxley novel. We have a Chancellor with nowhere to go, representing a Government no one believes. It is time to let the people decide.
Sally-Ann Hart (Hastings and Rye) (Con)
Hastings and Rye is a vibrant and dynamic place that is home to amazing and resilient tourism, retail and hospitality businesses, hundreds of small and medium-sized enterprises, and a robust manufacturing sector specialising in vacuum and precision engineering. However, it has pockets of deprivation. That is why I welcome the measures taken by the Chancellor in yesterday’s Budget, which is bolder than it seems, reflects a dose of optimism and a good dollop of resilience, and builds on policies that have halved inflation, reduced debt and promoted a growing economy. I particularly welcome the measures taken to support hard-working families. The Budget addresses the cost of living burden by reducing employee national insurance contributions by another 2%; they have gone from 12% to 10%, and now to 8%. It is giving thousands of people in Hastings and Rye a tax cut—a cut of over £900 for the average worker.
Let me take this opportunity to correct the shadow Chancellor and dispel the nonsense being spouted by Opposition Members. The Chancellor did not promise to abolish national insurance contributions yesterday. He expressed an ambition to do so, without compromising public services, but said that it could not be achieved any time soon, and would require responsible fiscal management. Cutting class 4 national insurance contributions from 9% to 6% will help self-employed people in my constituency, and alongside the duty freezes on fuel and pub pints and the extension of the energy price guarantee, it will help put hundreds of pounds back into people’s pockets.
I also welcome the historic investment in early years and childcare, which will help hard-working families. The 2024 Budget builds on the significant strides made in 2023, when an unprecedented sum of more than £1 billion was allocated for early learning and childcare. The 8% increase in funding for early learning and childcare for 2024 will directly benefit our children, our hard-working families and the dedicated professionals who nurture our children’s growth.
The enhancement of teacher training will, I hope, help to ensure early intervention and prevention of problems for all children, including those with special educational needs, so that they receive the support that they need to reach their potential. Addressing the unfairness of the child benefit system will benefit thousands of families in Hastings and Rye, promote equity and social justice, and ensure that families receive support based on their needs.
I also welcome the measures taken to help the most disadvantaged in my communities, such as the increase in the repayment period from 12 to 24 months for those on universal credit who are forced to take out advanced budgeting loans, and the fact that the £90 charge to take out a debt relief order will be scrapped completely. The household support fund was set up temporarily to help the poorest through the cost of living crisis with a one-off payment of £500, depending on circumstances. Its continuation for another six months is vital for a number of reasons, not least because it provides immediate relief to vulnerable households facing financial hardship. Its extension means that particularly vulnerable families in Hastings and Rye can continue to receive essential support during challenging times and avoid debt. However, it is worth noting that the fund is a temporary fix, and the Government need to continue their focus on longer-term solutions to address poverty and prevent families sliding further into financial distress. Work is the only route out of poverty. That is why the Department for Work and Pensions back to work plan and our family hubs, which support families in so many ways, are vital policy measures.
It is really good news that, despite the challenges posed by the pandemic and the war in Ukraine, our economy is showing signs of recovery. The OBR’s revised growth forecasts for 2024 show a modest improvement from 0.7% to 0.8%. That may seem incremental, but it does signify progress.
Small and medium-sized enterprises are the backbone of our local economy. I welcome the £27 billion tax cut for businesses through the radical policy of full expensing, and through capital allowances reform. This move will drive investment, stimulate growth, empower our entrepreneurs, encourage innovation and create jobs in Hastings and Rye, but we need to encourage more local young people into science, technology, engineering and maths, further education and apprenticeships. University technical colleges and UTC sleeves will be a real step forward in providing skills for the future.
While tourism and hospitality have greatly benefited from generous Government support over recent years, including the extension of reliefs into 2024-25, I would have liked more of a boost for our tourism and hospitality businesses from the Chancellor; a clear pathway for reform of business rates in England up to 2026, including reliefs; and action on VAT. The British Retail Consortium said some time ago:
“We need a business rate tax that flexes with overall economic performance, is shared equitably across different industries and comes with positive incentives for business.”
I will briefly mention student loans. We all recognise the punitive rates of interest paid on student loans by our graduates, and it is not feasible to write off all the debt. Could the Chancellor please ensure that no graduate pays interest at a rate higher than the average available commercially? That will help millions of graduates who deserve a fairer rate of interest, allow our young professionals some financial stability, and give them the certainty to make sound life choices.
Let us embrace this Budget with optimism. The last few years have not been easy for the British economy, with the legacy of covid, and war in Ukraine and the middle east. It is only because our economy was in a better state as a result of the Government’s policies since 2010 that we could afford to protect people and businesses, and support Ukraine. Our economy is now turning a corner. We cannot allow the Labour party to play fast and loose with our economy again, and take us back to the economic tatters of 2010, after all we have been through in the past few years. This Budget is a road map to a bolder, brighter future for Britain—a future in which businesses flourish, our families thrive, and our communities can stand resilient.
Jim McMahon (Oldham West and Royton) (Lab/Co-op)
It is interesting to follow the hon. Member for Hastings and Rye (Sally-Ann Hart). I will leave it there.
The test of any Budget is simple, and we all know it, in politics and elsewhere in life: are working people better or worse off? The fact is that Britain is worse off. There are higher taxes, lower wages and a stagnant economy. The tax burden is at its highest for over 70 years, since 1948, and the national debt is at its highest since the 1960s. Average households will still be £870 worse off after all the Budget measures, and this will be the only Parliament on record in which living standards fell lower at the end of it than they were at the start.
The real cruelty is not that the Budget was a missed opportunity for the Conservative party to gain some ground; it is that working people do everything that is asked of them and more, but that work is not rewarded. Real pay has gone up by just £17 a week over 14 years of Conservative Government. Compare that with the last Labour Government, under which wages rose by £183 a week over 13 years. Even the national insurance reductions pale into insignificance when we consider that the personal tax allowance freezes will take £41 billion from working people. In the end, working people are worse off, and they know it.
Working people know that the communities where they live and work, and that they care about and are invested in, are feeling the strain, as are public services. People are waiting longer for NHS treatment than ever before. Even before the pandemic, which has been used a number of times as a reference point, 2 million more people were on waiting lists than when Labour was last in office. Today, waiting lists stand at 7.6 million, impacting more than 6 million patients. What of the nation’s productivity, when there is low life expectancy, which in some cases is going down, and when quality of life is compromised by pain, worry and stress? How can we talk about productivity in the economy when the nation is simply not well?
There is a firm poverty postcode lottery. The King’s Fund reported that people who lived in the most deprived areas of England were twice as likely to wait more than a year for treatment as those who lived in more affluent areas. It is a postcode lottery on health, and an inequality that is not right in the modern age. There is no healthy economy without a healthy society. That the Chancellor does not get it is one thing, but for a Chancellor who was previously Health Secretary not to get it beggars belief, frankly.
We all know that health and social care are interlinked, and that people’s wellness and the economy are interlinked. Labour will get the NHS back on its feet—we did it before and we will do it again—but we were disappointed not to see more interaction between health and social care yesterday. Like the Local Government Association, I was disappointed not to see a focus on adult social care.
Let me focus on Oldham, a borough of nearly a quarter of a million people—good, decent people who should have been front and centre of this Budget. There, like everywhere else, they know that good public services are the foundation of a good economy, not a burden placed on it. They know the cost when public services are overwhelmed by demand, staff are under immense pressure, and those they love do not get the care they need.
Many MPs will know this from our surgeries, but not that long ago, if people were having a struggle with housing, adult social care, SEND support or a range of other different public services, it would have been the exception and not the rule that they were found to be in a difficult position. Now, however, we all know that when people come to us to say that they have a housing crisis, we have to reply, “That’s the rule for many; it’s not the exception any more.” When people say that the person they love cannot get adult social care, we say, unfortunately, “That’s the rule now for too many; it’s not the exception any more.” When parents come and say that they are fearful for their children because they have not got the SEND assessment and support needed, we say too often, “That’s not the exception any more; it’s the rule for too many people.” The public service infrastructure for too many people has completely been eroded.
In many places the market has completely failed. We see that in adult social care and in children’s services, where the cost of placements is significantly impacting on local authority budgets. Then we come to temporary accommodation, which has to be mentioned. In Oldham, the cost of temporary accommodation has increased from £1.9 million to £6 million in just a few years. That is not the real story, of course; that is just financial pressure. The real story is that behind every figure is a family, a family in desperate need. In Oldham, 1,000 people are in temporary accommodation, including 500 children—500 boys and girls in temporary hotel accommodation, sharing a room, mixed gender, mixed age groups and often in mixed hotels, where the hotels are not even block booked to stop private clients being able to access the facility. That is not right, it is not safe and it reflects a broken market.
In the end, we need to rewrite the British contract, because it has failed too many working people. The idea that if people roll their sleeves up, work hard and make a contribution, they can get on in life and build something for themselves and their family, has been taken away from people. More than that, the generational progression that should be there has been denied. I look at my children growing up now and I see a housing market that is moving further and further away from them, not closer. People in my community see that the good, well-paid, skilled working-class jobs are something of the past and not the future. That fundamentally hits at the heart of the British contract, so we need a different way. As chair of the Co-operative party, I would say that we should be looking at many examples in the co-operative movement.
Ownership matters. We have seen a complete hollowing out of ownership in our communities. Look at our high streets and our town centres: we do not even know who owns the building that has been boarded up for 10, 15 or 20 years. Ownership matters.
On energy, we see that people are paying more and more for their gas and electricity to oligarchs and offshore interests, when here we are not building something that we can own together. That is where the Labour party is setting out a different path. With onshore and offshore renewables through Great British Energy, we can own something together, where we get to share its value, where we can take back control of our energy supply, our energy security and our energy bills.
In the end, this comes down to the Government deciding to choose a path and a course. I think that some of those issues should be beyond politics. Part of the problem with British politics is that things follow the parliamentary cycle far too much, when some are far more structural, such as adult social care and the future of health and social care. There should be a bigger response to that than whatever the Chancellor of the day thinks at a moment in time. Greater consideration should be given to the future world of work, and ensuring that work pays and gives people the opportunity to live a decent life. When we do not have that big politics and those big ideas, I am afraid we end up in the same situation that we found ourselves in yesterday: frankly, vacuous and without ideas.
Grahame Morris (Easington) (Lab)
It is a pleasure to follow my hon. Friend the Member for Oldham West and Royton (Jim McMahon). My constituents, like his in Oldham, have a sense of disappointment about the Budget’s failure to address many of the challenges that they and others in former coalfield and industrial areas face.
Taxes in the UK are unfairly distributed, penalising our poorest communities. Rather than supporting our fragile regional economies, Government policies and decision making take money and resources out of our communities. Data from the Office for Budget Responsibility show that, despite the headline cut to national insurance, the UK’s tax burden is the highest it has been in 70 years, and that it rises every year of the forecast period. It is true that anyone in my constituency living on the national minimum wage—earning around £20,000—will receive an extra £148.60 a year, or £12.38 per month, from the reduction in national insurance.
However, we need to look at the overall tax burden. Around 40% of that extra income will be lost to the increase in council tax. My council’s website, which gives some examples, says that those living in a band A properties will be charged £61 more next year. Of course, that figure will be much higher once we have added increases to parish police and fire precepts. The problem is compounded in areas that, like mine, have a small council tax base because the majority of properties are in bands A to C. Indeed, the additional money that councils raise will not even cover the rising costs, so we will have to pay more but see services cut.
Durham County Council will receive—I have checked this figure—£130 million less in revenue support in 2024 compared with 2010. Indeed, a survey by the County Councils Network found that 95% of local authorities are increasing council tax by the maximum permitted 5%. In east Durham, that means that our poorest communities are paying the most. Here is an interesting example: a band A property in Easington Colliery faces a council tax bill of £1,671, which is not far short of the Prime Minister’s £1,824 council tax bill for his band H flat in Downing Street. If the Prime Minister were paying council tax on a band H property in Horden in my constituency, his council tax would be £5,157.88. Despite our property prices being significantly below the national average, our poorest communities, and residents in my constituency, are facing council tax bills similar to that of the Prime Minister. Council tax is a new poll tax in all but name.
I often feel like a lone voice advocating for a proportional property tax, but I should not be, because it would benefit 77% of UK households. Proportional property tax is a flat tax—a charge of 0.48%—on a property’s current value. It would effectively be an annual economic stimulus to the regional economies worth £6.5 billion a year, increasing disposable incomes of households in the poorest communities, which do not enjoy the same levels of public and private investment as households in London and the south-east. Services that take up the largest part of Durham County Council’s budget are adult social care and looked-after children. Those are important services, but they should be funded nationally based on a needs assessment.
Those costs should not fall on local taxpayers, particularly as we have seen a rise in some councils and service providers effectively outsourcing those with complex needs by moving their people into our poorest communities. If the Minister is not aware of that issue and wants to understand how councils in the south are gaming the system at the expense of my constituents, I recommend that he reads an article by the Express journalist Zak Garner-Purkis—I do not normally recommend the Express, but he is an excellent journalist.
Far from giving our communities a chance, the Government’s policy, taxation and investment decisions are widening the economic divides in our country through higher taxes and a lack of public investment, which impact on the private sector’s willingness to invest in my constituency. Of course, there would be opportunities if we had the right investment and growth policies. We have large areas with derelict and run-down housing that would be ideal for redevelopment and the creation of decent family homes, but we have a tax and investment system that holds back our regional economies and deprives them of opportunity. We have a Government who refuse to take any steps to address widening economic disparities—I thought that was the whole purpose of levelling up.
There are other national issues that affect my constituency, including the NHS: there are long waits in A&E, and NHS dental provision is collapsing. We have over-subscribed schools, a lack of home-to-school transport, and schools in a poor state of repair—not only those affected by RAAC or asbestos, but some quite new schools built by disreputable construction companies that have fleeced the taxpayer.
The Conservative party has now had 14 years, either in government by itself or in coalition with the Lib Dems and others, to improve the opportunities for constituencies such as mine. However, 14 years on, the problems that our country faces today are just as deep-rooted and extensive as ever. The Chancellor and the Prime Minister say that they are proud of their record. Well, I think my constituents have reached the same conclusion as many others. They say it is time to put that confidence to the test. If this Government have a shred of integrity, we should be going to the polls on Thursday 2 May for a general election. The Chancellor’s Budget has lifted the lid on 14 years of Tory economic failure: taxes are still rising, prices are still going up for consumers, mortgages are going through the roof, and the Chancellor did nothing yesterday that is going to change that. We need a Government that can rebuild Britain. It is time for change. It is time for a general election.
Stephen Kinnock (Aberavon) (Lab)
It is a real pleasure to follow my hon. Friend the Member for Easington (Grahame Morris).
We on the Labour Benches talk a lot, and rightly so, about the Conservatives crashing our economy and sending mortgages up by almost £3,000, rent up by 10%, and food prices up by 25%. We talk a lot about the fact that the Prime Minister is utterly blinkered about the truth that he has gone from being a low-growth Chancellor to a no-growth Prime Minister, with the introduction of Rishi’s recession, and that working people are paying the price in this cost of living crisis. We talk a lot about Tory waste: the fact that the Prime Minister has blown £7 billion on covid loan fraud, and £500 million on a Rwanda plan that has flown three Home Secretaries to Kigali, but not a single asylum seeker. We know that the tax burden is at its highest level for 70 years, while debt has rocketed and is still going up.
However, we should probably talk more about the underpinning mismanagement of our economy and the broken economic model that has seen Tories under-investing, turning our country into a stagnation nation. We have a record high NHS waiting list of more than 7 million people; schools that are literally crumbling because the Prime Minister cut the school building budget when he was Chancellor; 90% of crimes going unsolved, with rape victims waiting three years for their day in court; and three times as many children living in poverty today as did six years ago. The reality is that the past 14 years have been an omnishambles. As a result, nothing in this country seems to work any more, yet the British people are being forced to pay more and more for less and less.
What ideas have the Conservatives put forward to fix this mess? None whatsoever. Instead, they resort to pilfering Labour’s policies like some sort of embarrassingly bad tribute act. When the cost of living crisis hit, we knew we needed to support households through it, so we proposed a windfall tax on the excess profits of oil and gas companies. The Conservative party eventually caved in and delivered that policy, but poorly and riddled with loopholes.
This week, the Government have made a feeble attempt to mimic our policy of ending the non-dom tax loophole. Just think: if they had acted when Labour first suggested ending this loophole two years ago, they would have generated £6 billion for the policy areas we suggested. They could have delivered 3.8 million extra operations, 1.3 million emergency dental appointments and free breakfast clubs for nearly 4.5 million children. The Conservatives are followers, not leaders. They are slogan-mongers, not servants of the people. They believe in government by gimmick rather than the hard graft of governing in the national interest.
Labour, meanwhile, is taking a long-term responsible approach to get our economy back on its feet and growing again, which is why we have our five core missions. We will get businesses growing and put demand back into the economy, starting with our new house building programme for 1.5 million homes over five years, creating new jobs and getting young people and families the housing they need. We will deliver clean energy by 2030 and switch on Great British Energy. Our transition to a modern economy will deliver half a million good jobs, lower household bills and make our energy supply secure from Putin. We will get the NHS back on its feet and fit for the future, and bring down waiting times with the biggest ever workforce expansion, including 17,000 more doctors and nurses and 2 million more available appointments. We will put 13,000 police back on the streets, and halve the number of incidents of violence against women and girls. We will spread opportunity for young people everywhere by shattering the class ceiling through better early years provision and improving technical education.
Instead of the Government’s hands-off, “Not my problem, guv,” approach to the economy, we can deliver an active industrial strategy, backing our businesses to make, buy and sell more in Britain. This includes Labour’s £3 billion steel renewal fund. With that, I am urging Tata Steel to step back from the cliff edge, which would cost 2,800 people their jobs in Aberavon and Wales, and not do anything that cannot be undone before the next general election. What a disgrace it is that the Conservative Government have given £500 million to Tata to make 2,800 people redundant. We will work with industry to secure a bridge to the new economy, so that steel companies can seize the opportunities of the future and Britain can maintain its sovereign capability to make its own steel from scratch. This is a vital security issue in the dangerous and turbulent world in which we live. If we want to get Putin’s boot off our throats, we have to sustain our vital steel industry.
We on these Benches are also committed to supporting small businesses. We will legislate to tackle late payments, unlocking £20 billion in unpaid invoices. We will scrap business rates, and replace them with a system that is fairer for bricks and mortar businesses. These are the kind of growth measures we need to get Aberavon, Wales and Britain firing on all cylinders.
Last year, the Prime Minister said, “We’ve turned the corner,” and promptly plunged Britain into a recession, with an economy smaller now than when he entered Downing Street, mortgages through the roof, house building fallen off a cliff, worklessness rising, homelessness never higher, crimes going unsolved and rape victims waiting years for their day in court. We have rivers full of sewage, which is the perfect metaphor for the stench of decay that is emanating from this clapped-out Government.
Households are £870 worse off on average under Sunak’s —the Prime Minister’s—tax plan. With just 5p given back for every 10p taken from our constituents, he is giving with one hand and taking twice as much away with the other. That is not a plan; that is a scam. It is a con from this Government, who have run out of ideas, run out of energy and run out of road. We need an election this spring, and we need a Labour Government who will rebuild our public services, re-energise our economy and get our country back on track.
Several hon. Members rose—
Mr Deputy Speaker (Mr Nigel Evans)
Order. Let me remind Members that we do not use the Christian names or surnames of current serving Members. I think the hon. Member for Aberavon (Stephen Kinnock) knows what I am referring to, but I did not want to stop him in his flow. All hon. Members are incredibly bright, and I am sure that they will think of another way of making their point.
Alex Cunningham (Stockton North) (Lab)
Fourteen years of Tory Government and they still cannot find a Chancellor who understands poverty, inequality and the need for public services. Despite the latest one being a former Health Secretary, he does not understand health and the role it plays in our society. I remind Government Members that they cancelled the new hospital for Stockton in 2010, and health inequalities in my area have since widened, despite the tremendous work of NHS workers and others.
Today I will try to help the Tories understand the consequences of their 14 years in power: over a decade of austerity and, now, “somebody’s” recession. At the weekend I was appalled to hear that life expectancy in the north-east compared with the rest of the UK will continue to fall for the next 50 years. A report by the Institute for Public Policy Research North’s stated that wealth, health, power, opportunity and systematic inequalities are just a few of the reasons why the north-east is set to see the north-south life expectancy divide endure for decades. It stated:
“The number of years you can expect to live in good health in the North and Midlands would be two-and-a-half years shorter than the South and three-and-a-half years shorter than in London.
Extending these overall trajectories, the gap in healthy life expectancy between the North and the all-England average would not close until 2056/57 while the gap between the North and South East would endure until 2079/80”.
After 14 years of Conservative Government, nothing has happened to close the gap, and national comparisons are widening further. It is even worse locally. People in the town centre ward in Stockton are expected to live 16 years fewer than those down the road in Ingleby Barwick.
That news comes after reports of a huge increase in child poverty, people being unable to see a GP for weeks on end, dental appointments that are simply not available, and waiting lists for operations stretching and stretching. Some appointments for operations that took just a few weeks in 2010 now take many months or, in some cases, over a year. I welcome the new diagnostics centre being built in Stockton, but it is only one small piece of a very large jigsaw of provision needed to do the best for our people. The author of the report and IPPR North research fellow Marcus Johns has confirmed that urgent action is needed to tackle the inequalities. He said:
“No one should be condemned to live a shorter, sicker, less fulfilling, or poorer life simply because of where they were born… It’s hard to avoid the conclusion we are headed in the wrong direction on inequality in health, wealth, power, and opportunity while local government finances languish in chaos.”
Let me turn to another report demonstrating regional inequality. The North East Child Poverty Commission’s February 2024 report highlighted that there has been no child poverty strategy for England or the UK as a whole since 2017. However, the proportion of north-east children in poverty from working families has risen from 56% to 67% in less than a decade. The report also found that the intensity of child poverty in the north-east is getting worse, with one in five children in our region now living below the deep poverty line, and more than one in 10 north-east children living in very deep poverty. Almost one in five north-east children is living in a food-insecure household, meaning that they do not have access to sufficient food to facilitate an active and healthy lifestyle.
Children in our region have been let down in a range of other childhood health measures, having either the highest or second highest rates in England of A&E attendance, emergency hospital admissions, and hospital admissions for asthma, diabetes and dental treatment. All of those are associated with higher levels of deprivation.
On children in care, the north-east has the highest proportion of looked-after children of any English region—113 per 10,000 children, compared with the England average of 74. In the Tees valley, all five local authorities are among the 20 areas with the highest rates of looked-after children in England. Indeed, the link between high rates of child poverty and social care interventions was flagged by the 12 north-east directors of children’s services, which made a joint submission to the independent review of children’s social care back in 2021. It said:
“Exceptional levels of poverty in the North East are driving dramatic rises in child protection intervention and the number of children in care. The cost of this cannot be afforded. Exacerbated by reductions in government funding, spending on early help has reduced at a time when it has been most needed. This vicious cycle can only be broken by different ways of working, backed up by adequate investment.”
Do we not want the best for every child, whether they grew up in the south-east or the north-east? We will not have it unless every child’s basic needs are met. It is deplorable that the Government, with their failure to act, have become complacent, with children in my region going to school hungry, unable to concentrate, unable to learn, and unable to have the future for which they have the potential. I am pleased that Labour is committed to ensuring that all primary school children have free breakfast clubs that set them up for the day, so that no child starts the day hungry and there is a safe space in which to be supported with friends.
There is another matter of great importance to Teesside. There is one area where there has been colossal amount of taxpayer investment in the north-east, but sadly, those same taxpayers are being robbed of the benefits of £0.5 billion invested at Teesworks. My advice to the Chancellor is to get the forensic accountants to pore through the books and reports, and they will find tens of millions of pounds that could have been reinvested in the people of Teesside, instead of being pocketed by two private sector businessmen, after the Teesworks Tory Mayor gifted them 90% of the asset.
Teesworks is probably one of the most important projects in the country, but private individuals will benefit most from the hundreds of millions in profits expected over the coming years—individuals who are yet to invest their own money. I have wondered how the tens of millions of pounds paid out in dividends to those two individuals could have been used on Teesside, where all our local authorities are being forced by the Government to cut services and hike council tax. If those local authorities had just £10 million each, they would not have to cut services and our social care could be given a major boost.
The Chancellor also needs to look at the 28 recommendations in his own Government’s inquiry into the appalling way the Tees Mayor has been running his business— 28 recommendations because of the lack of transparency, poor value for money, and a total disregard for proper process. Recently the Mayor landed us with a legal action bill in excess of £3 million against PD Ports. It leaves the legal fees of the Secretary of State for Science, Innovation and Technology looking like chicken feed. If the Chancellor is serious about value for money from taxpayers, he would show the guts that the Secretary of State for Levelling Up, Housing and Communities has failed to show, and order the National Audit Office to see exactly how the £0.5 billion of taxpayers cash has been used at Teesworks and who is deriving the benefit. I think he will discover that Teesworks is not working for our communities, and we have seen only a few hundred of the tens of thousands of jobs promised actually created.
In conclusion, we have had the years of austerity and we now have the Prime Minister’s recession. The ramifications have been immense: appalling regional inequality, poor health, and a cost of living crisis, but above all, poverty on a scale we should be ashamed of.
Michael Shanks (Rutherglen and Hamilton West) (Lab)
It is a pleasure to follow a fellow Scot, my hon. Friend the Member for Stockton North (Alex Cunningham). A decade ago George Osborne—remember him?—stood in this place to deliver the first Tory Budget. He spoke about a Budget that recognised
“the hard work…of the British people”
and set out a plan for Britain
“to keep moving us from a low wage, high tax…economy”.—[Official Report, 8 July 2015; Vol. 598, c. 321.]
A decade later, after 14 years of Conservative Government, where are we? In a recession, whether the Chancellor calls it “technical” or otherwise, and with taxes higher than at any point in the past 70 years. We have had 20 years of lost pay growth, with the Resolution Foundation confirming that the average wage will not regain its 2008 level until 2026. Shamefully, this is the first Parliament since records began to see living standards fall—the most significant year-on-year decline in living standards since the 1950s. That is the reality of yesterday’s Budget— a record of economic incompetence and squandered opportunity.
Will the public feel any change in their circumstances after their pockets have been raided by 25 tax increases, and with mortgages soaring, food bills continuing to go up and up, and wages stagnating? Who on earth will feel any better off in those circumstances? Given the lacklustre response from those on the Government Benches during the Budget yesterday and in today’s debate—I have enjoyed it enormously, but there have been more contributions criticising the Budget than supporting it—it seems that they are not particularly impressed by it either, and no wonder. Less than 24 hours after the Chancellor stood up, the chaos has continued. We had a floated promise of a £46 billion cut to national insurance without a single thought given to how it would be funded, although I now hear that has been downgraded to the Chancellor expressing an ambition, which apparently is different. It is perhaps how Liz Truss expressed an ambition to crash the economy not that long ago.
Mr Deputy Speaker (Mr Nigel Evans)
Order. I did say not to mention the name of current sitting Members.
Michael Shanks
I forgot she was a sitting Member, Mr Deputy Speaker; I apologise.
The Government are putting off any long-term spending plans to the next Government to avoid facing up to the reality that public services are crumbling. Shamefully, they are not putting aside a penny for the victims of the contaminated blood scandal or the victims of the Post Office scandal.
Minutes after the Chancellor sat down, we had the spectacle of the Under-Secretary of State for Energy Security and Net Zero, the hon. Member for West Aberdeenshire and Kincardine (Andrew Bowie) refusing to say whether he would back his own Government’s plan to expand the windfall tax on the oil and gas industry. I am not sure if he is still on resignation watch or whether his chat with the Chancellor has moved him back to a stronger position, but yesterday, the Tories in the Scottish Parliament had a debate denouncing expanding the windfall tax, and the leader of the Scottish Conservatives, the hon. Member for Moray (Douglas Ross) has said he will vote against it. This morning, the Chancellor said it would present a little local difficulty. This is utter chaos, less than a day after he delivered the Budget. With any other Government, at any other time, they would be the laughing stock of the country, but so low have our expectations fallen that it is not even getting the attention it should.
We should welcome the Government’s conversion to Labour’s economic plans, following where Labour has led on the non-dom tax loophole or expanding the windfall tax. Now it is only the SNP that is out on a limb, saying that it does not support increasing a tax on the £1 billion a week profits from oil and gas, while happily putting up taxes for those earning £29,000 a year. In SNP Scotland, teachers, plumbers, police officers and nurses pay more; oil and gas giants do not.
Peter Grant
The hon. Member mentions the specific case of nurses. His colleagues were reluctant to acknowledge the fact that nurses in Scotland start off with much higher pay than those in England. I did some checks while others were speaking. A newly qualified ward sister in Scotland on 2023-24 rates, even allowing for slightly higher income tax on part of their earnings, is taking home £31,884 a year. His or her equivalent in England is taking home £30,960. Why does the hon. Gentleman want nurses in Scotland to earn £900 less when moving to England?
Michael Shanks
I know I am in a different party to the hon. Member, but I am in the same country, so it concerns me how nurses in Scotland are treated, and they are paying more tax than their colleagues in England. That is the reality of the SNP’s budget.
The truth is that a lack of economic growth across the UK means less for public services, despite the Scottish Government receiving almost £300 million in consequentials, including £237 million from increased spending in the NHS. I hope that the Scottish Government use that to invest directly in public services, and especially in Scotland’s NHS, where statistics this week have shown a damning picture of the SNP’s 17 years in power. The list of in-patients waiting more than 12 weeks has gone up 125 times in a decade. Cancer treatment within 31 days is three times worse than a decade ago. All the while, taxes are going up in Scotland and wage growth is stagnating.
The House of Commons Library has carried out some research that shows that weekly real earnings are lower today than in 2007 when Labour left office in Scotland and the SNP first came to power. The analysis shows that real wages continued to rise until 2010, when the Labour Government left power in the UK, but under the Tories and the SNP, the average Scot earns less in real terms now than they did in 2007. EY this week found that average employment growth in Scotland between 2024 and 2027 is expected to be just 0.8%, lagging beyond all other parts of the UK.
There are some really tough long-term issues in Scotland’s labour market that we must wrestle with. Long-term sickness appears to be a particular factor in economic inactivity in Scotland, accounting for nearly 32% of inactivity compared with 27% across the UK. There are difficult demographic trends, too. These issues are not easily resolved, but they require a Government with a laser focus on the problem, not one from a hopelessly distracted party.
The Secretary of State spoke about levels of employment in the UK. Recent research by the Work Foundation and Lancaster University found that of those in employment, 21% are in extreme job insecurity—workers who experience involuntary part-time work, involuntary temporary forms of work and precarious work—and a further 33% suffer from low or moderate insecurity. In other words, more than half of people currently employed have a degree of insecurity in their work. The UK is becoming a less secure, precarious place for people to work, and part of the cause of low productivity and rising levels of in-work property is that problem. It is a challenge for us to wrestle with, but we must do so.
The Tories are the architects of this economic mess, ably assisted by the growing incompetence of the SNP. Neither can be the solution. Scots will rightly ask themselves after 14 years of the Tories and after 17 years of the SNP whether they feel any better off. The answer will come back: no. They will ask if public services and the NHS are better now in Scotland than they were 17 years ago, and the answer will be no.
The only way out of this doom loop of economic chaos, higher taxes and stagnant living standards is real change, with a Government focused on growing the economy, making work pay and turning the UK into a green energy superpower. That is the change that Scotland needs. That is the change that the UK needs. That is the change that Labour will deliver. We need a general election so that we can get on and do it.
Mr Deputy Speaker (Mr Nigel Evans)
Liz Twist will make the last Back-Bench contribution, so anyone who has taken part in the debate should make their way to the Chamber now.
Liz Twist (Blaydon) (Lab)
Listening to yesterday’s Budget, we could be forgiven for thinking that the Chancellor was living in a different universe from the rest of us. Wages are stagnating, taxes are rising, growth is stalling, and nothing the Chancellor announced yesterday has changed that. The OBR’s own figures tell us that this will be the worst Parliament on record for living standards. After 14 years of economic failure, his legacy is less money in people’s pockets and the highest tax burden since 1949.
The Chancellor tells us that absolute poverty has gone down and that growth can come only from a high-wage, high-skill economy, which we are supposed to believe his party is on the way to building. Let me tell him that that is not the reality that my constituents are dealing with.
The Chancellor may try to tell us that people are better off after cuts to national insurance contributions, but for every 5p that my constituents get back, they will be paying double that in extra tax according to his plans and the package. People are being squeezed further and further as prices continue to rise. Even a reduced inflation rate means that prices are going up and costing people hard. For those already on low pay, the benefit is even less. The cut is better for higher paid workers and comes at the cost of lower-paid workers, many of whom live in my constituency.
For generations, parents have hoped that their children would have it better than they did growing up. Of course, that has never been guaranteed, but for too many people today it is a far-off dream. There are 9 million young workers in this country who have never seen sustained average wage rises. This is the only Parliament on record where living standards have fallen. Consecutive Conservative Governments have seen inequality outstrip that seen in any other large European country, and our public services on their knees just as people need them more than ever.
Many of us in the House will recognise the stories behind these statistics in the constituents who come to our office doors in the most desperate of circumstances with nowhere else to turn. A report released in January by the Joseph Rowntree Foundation laid out the extent of rising poverty and destitution, which is hitting families with children and disabled members hardest. It said:
“This is a story of moral and fiscal irresponsibility”,
and it is one that affects constituents in Blaydon and across the north-east. In the north-east, the proportion of children in poverty who are from working families has risen from 56% to 67% in less than a decade. That is the impact of Tory Government decisions on real people’s lives day to day.
Times are really hard for people, and we know that there is a well-established link between socioeconomic factors, such as financial distress, and mental health problems, and vice versa. It was therefore disappointing to see nothing on offer in this year’s Budget to tackle our mental health crisis, and organisations such as the Samaritans, YoungMinds and the Mental Health Foundation have all commented on that. Despite uncertainty and anguish in the sector about the ringfenced funding for local suicide prevention plans, which is set to run out this financial year, we did not hear a word about those plans on Wednesday. Nor did we hear anything about specialist mental health support in schools, suggesting that the Government’s aspirations remain limited to covering just 50% of schools. The hon. Member for Redditch (Rachel Maclean), who is just walking into the Chamber, talked about people with mental health problems and bad nerves. Would it not be great if we could tackle NHS waiting lists for mental health services so that people could get the support and diagnosis they need and could improve their lives?
In the meantime, the picture on social care also remains bleak, with the Government’s ambition failing to meet the essential needs of older people, disabled people and their carers, and with local authorities struggling to balance their budgets. There is nothing to tackle that issue.
As a north-east MP, I noticed the Chancellor’s reference to a deeper devolution deal for the north-east. I am pleased to see the north-east getting more powers, and many more powers are needed regionally. However, our aspirations in the north-east are even higher than those in this deeper devo deal, and I have no doubt that we will continue to press for even more measures to reduce regional inequalities.
If one thing was clear from yesterday’s Budget, it was this: the Government are out of touch and out of ideas. Unable to face up to the crisis they have presided over, they are left spinning and scrabbling, trying to tell us that we are out of the woods, while our constituents feel the impact of the recession and tell us about it. The Government’s plan has failed. It is time for a new approach. It is time for a general election.
Mr Deputy Speaker (Mr Nigel Evans)
We come to the wind-ups. I call Liz Kendall.
Liz Kendall (Leicester West) (Lab)
Thank you, Mr Deputy Speaker. Yesterday, the Conservative Government’s seventh Chancellor gave his second Budget—thankfully, the last before the general election. Ministers have repeatedly claimed that the economy has turned a corner, but they have driven it into a dead end. Our economy is smaller now than when the Prime Minister entered Downing Street. Not only was GDP per person down in every quarter last year, but it will be lower at the end of this year and lower, too, in four of the next five years. In this Parliament, we have had the biggest hit to living standards on record, and we have the highest tax burden for 70 years.
But people in this country do not need statistics to tell them the dire state we are in or that they are paying more but getting less. They see it every day in the higher cost of the weekly shop and in their gas and electricity bills. They see it in higher mortgages and rents and in soaring childcare costs. They see it in their crumbling school buildings and in the 8 am scramble to see their GP.
The argument I want to make today is that one of the central reasons why the Government have failed on the economy is that they have failed on work. For all the claims made by Ministers, the OBR lays bare the scale of their failure and the appalling cost to the British people.
The official unemployment rate is low, but that is not because a record proportion of people are in work. We are the only country in the G7 whose employment rate has not returned to pre-pandemic levels. Yesterday, the Office for Budget Responsibility revealed that our employment rate will be lower by the end of this year than it forecast in November; that the rate will be lower in five years’ time; and that in 2028-29 it will still not be back to where we were before the pandemic. That is the truth of what another five years of the Conservatives will bring.
The reality is that increasing numbers of people are leaving the labour market and not even looking for work. Whatever the Secretary of State says—he repeated it today—the OBR says that economic inactivity is increasing, not declining. It says that economic inactivity is proving more persistent than it previously thought. It is no longer declining from the post-pandemic high and has instead rebounded to a total of 9.3 million people—the highest in over a decade.
Much of the problem is driven by poor health, an issue raised by many hon. Members in this debate. On the Labour side of the House, we know that a healthy nation is critical to a healthy economy and that the Government are failing on both. Some 2.8 million people are now not in work because of long-term sickness—an all-time high. Many of them are over 50: often women struggling with bad hips, knees and other joints, often caring for elderly parents at the same time.
There has been an extremely worrying increase in young people out of work due to mental health problems, with many lacking basic qualifications. As the Centre for Cities has shown, all those problems are far worse in northern towns and cities, which the Conservatives promised to level up, but which have once again borne the brunt of their economic failure. In places such as Blackpool, Blackburn, Middlesbrough and Hull, if we include the hidden unemployed in the figures, it takes the official unemployment rate from 5% to 20%. The Labour party thinks that unacceptable.
The waste of individual potential is appalling, as hundreds of thousands of people who want to work are written off and denied help to get back on their feet. This is a waste for British businesses, which are desperate to recruit and need the talents of everyone in our country to grow and succeed. It is an appalling waste of taxpayers’ money, too. Over the next five years, 600,000 more people will be on sickness and disability benefit, which will cost an extra £33 billion—more than our day-to-day expenditure on defence.
The impact on our economy is profound. Yesterday, the OBR said that
“higher and rising levels of inactivity”
are offsetting increases in the size and growth of our population, and will leave GDP in five years’ time
“unchanged…and the level of GDP per person…lower.”
There it is in black and white: the Conservatives’ failure on work is a drag on the economy, a drag on growth, and a drag on living standards and money for our vital public services. That is not good enough.
Mel Stride
I thank the hon. Lady. She is rightly not happy with the level of economic inactivity; that is why we are bearing down on it. Given that the level of economic inactivity was higher during every year of the last Labour Government, would she like to comment on their record on it?
Liz Kendall
I will not take any lessons from a Government who are overseeing economic inactivity at record levels. The number of people out of work due to sickness is at a record level, resulting in soaring costs for individuals and livelihoods. If I were the Secretary of State, I would put in place a proper plan for reform, not offer half-baked programmes, rehashed and re-announced schemes, and more of the same empty rhetoric on benefits.
Mel Stride
If our plans are half-baked and rehashed, why has the OBR confirmed that by the end of the forecast period, 371,000 fewer people will be receiving the long-term sickness and incapacity benefits to which the hon. Lady refers? If our plans are half-baked, why will 371,000 fewer people be on those benefits?
Liz Kendall
The OBR says that there will be 600,000 more people on those benefits, and the total cost will be £33 billion. The Secretary of State tries to deny that the schemes are rehashed. Well, let us look at the reform to fit notes announced in 2023. Back in 2017, what did the Chancellor, then Health Secretary, announce? Reform to fit notes, taking them beyond GPs. The Government recently announced that there will be mandatory work placements. In 2011, what did they announce? A mandatory work activity programme. In 2017, the current Chancellor, as Health Secretary, said:
“We will appoint an Expert Working Group on occupational health.”
They are the same policies with the same failure. It is absolutely time for a change.
We do not have to go down this road; we can choose a different path. Under a Labour Government, we will do so. Our back to work plan will tackle the root causes of worklessness by driving down waits for NHS treatment, and we will recruit 8,500 more mental health staff. We will ensure that employment support is tailored to individual and local needs, by overhauling jobcentres to end the tick-box culture, and devolving employment support to local areas. In every part of the country, we will create more good jobs in clean energy and through our modern industrial strategy. We will make work pay and improve the quality of work, by ensuring a genuine living wage, banning exploitative zero-hours contracts, and strengthening rights to flexible working. And we will do more.
There are now 850,000 under-24s who are not in education, employment or training—one in eight of all our young people. That is a terrible waste for them and for our country as a whole. Given that half of all mental health problems start before people turn 14, we have to intervene earlier, so the first part of our offer to young people is about providing specialist mental health support in every school, and walk-in access in every community. That way, we will tackle one of the key drivers of worklessness before it takes hold. Secondly, we will deliver 1,000 new careers advisers, and good-quality work experience, so that young people leave school ready for work and ready for life.
Thirdly, we will overhaul skills by creating new technical excellence colleges and reforming the Tories’ failed apprenticeship levy, which has seen apprenticeship starts by young people fall by a third. Our new growth and skills levy will help young people to get the skills that they need, including by offering them a second chance at basic skills and pre-apprenticeship training if they did not get the right qualifications at school. Fourthly, we will provide new employment advisers for young people in our young futures hubs. They will offer joined-up specialist help and support, because the old, one-size-fits-all approach will not work when it comes to tackling this problem. Finally, we will overhaul access to work for young disabled people who want to work, so that they know what equipment, adaptations or personal support they will get before they start, giving them the confidence to take the plunge.
Our proposals are fully costed and funded, and will be paid for by scrapping tax breaks for private schools and closing the tax loopholes enjoyed by private equity fund managers. That is our offer to young people. This year, they and the rest of the British public face a choice: another five years of stagnation, low growth, high costs and worklessness under the Tories, or a long-term plan to get Britain building again, growing again and working again under Labour. The public know it is time for change. Let us have an election, and let us have the guts to have it now.
The Financial Secretary to the Treasury (Nigel Huddleston)
It is my pleasure to close the first full day of debate on this spring Budget, which my right hon. Friend the Chancellor of the Exchequer brought before the House yesterday. I thank everybody for their contributions today.
The past few years have been a sobering lesson in living through history. They have not been easy for the British economy or the British people, as we face the challenges and the legacy of covid, war in Ukraine and, now, war in the middle east. We all know that we are in an election year, but it is important that we focus on the policies as well as the politics, and on the facts, not just the spin, so let us have a look at some of the facts.
Inflation has fallen from 11% last year to 4% now. We knew that reduced inflation was the single most important thing for helping families, and it has happened. Real wages are now rising, and some mortgage rates are starting to come down. The economy has also performed better than forecast. It is projected to grow by 0.8% this year and by 1.9% next year, defying expectations that we would enter a long recession.
The International Monetary Fund forecasts that the UK will have the third-fastest cumulative growth in the G7 over the next five years, and will grow faster than Japan, Germany, France and Italy. We are on track to meet our fiscal rules, underlying debt is forecast to fall as a share of GDP in the fifth year of the forecast, and by the end of the forecast, borrowing will be at its lowest share of GDP since 2001.
Of course, it is only because we responsibly reduced the deficit by 80% between 2010 and 2019 that we were in a position to provide much-needed support, to the tune of £450 billion, during the pandemic and the recent cost of living challenges that followed the invasion of Ukraine. As has been repeated by many colleagues, we did not hear the Opposition complain about that support.
The support inevitably led to higher taxes, because public expenditure was higher. How on earth did the Opposition think all those interventions would be paid for? This reality has been forcefully emphasised today by my hon. Friends the Members for Folkestone and Hythe (Damian Collins), for The Cotswolds (Sir Geoffrey Clifton-Brown), for Devizes (Danny Kruger) and for Hastings and Rye (Sally-Ann Hart), all of whom made important contributions, but the job and the recovery are not yet done. Because of the progress we have made, though, the economy is turning a corner, and we have been able to afford tax cuts as part of our plan to reward work and grow the economy.
Karin Smyth
It is astonishing that on day two of the Budget, the Government still want to tell the country that it has never had it so good. Will the Minister address some of the points made by my hon. Friend the Member for Leicester West (Liz Kendall)? What does he say to those young people who cannot work because of disability or ill health? What does he say to women in their 50s who are not working? How does he propose to get those people back to work? We are the party of work, and we have heard a lot of myths today from Conservative Members. We believe in well-paid, good-quality work. The clue is in the name of our party. What will the Government do for those women, and for those young people with disabilities?
Nigel Huddleston
That is quite amazing. I opened my speech by saying, “Let’s focus on the facts.” Is Labour really claiming to be the party of employment? Every single Labour Government in history have left office with unemployment higher than they began with.
The Secretary of State for Work and Pensions outlined how we will help the very people whom the hon. Member for Bristol South (Karin Smyth) mentions. Far from saying that everything is fine and that people have never had it so good, we are being honest with the public by saying, “We know that you have been through an incredibly difficult time.” That is precisely why we intervened to such an extent, providing over £450 billion of support during the pandemic and since. It was out of necessity. That support was needed. It is important that we are honest with the British public that the money clearly needs to be paid back. We have higher taxes out of necessity, but as my hon. Friend the Member for Folkestone and Hythe said, we reduce taxes out of choice when we can. We increase them out of necessity, and we reduce them out of choice. The Opposition do not have that philosophy.
From April 2024, we are further reducing national insurance contributions, and employees across the UK will see their national insurance contribution rate cut from 10% to 8%. Alongside the cuts we already made to NICs at the autumn statement, this is a total annual tax cut of £900 for the average worker on £35,400 a year. Self-employed national insurance will be cut further too, to 6%; 2 million self-employed will also get a tax cut, worth, on average, £650 a year. Those measures will incentivise, encourage and support more people into work or to work longer hours. The OBR says that, when combined with the autumn reduction, our national insurance cuts will mean the equivalent of 200,000 more people in work, filling one in five vacancies and adding 0.4% to GDP, and 0.4% to GDP per head.
This latest cut to NICs is the latest step towards our long-term ambition to end the unfairness that means that if somebody gets their income for having a job, they pay two types of taxes—NICs and income tax—but if they get it from other sources, they pay only one. When it is responsible and when it can be achieved without compromising high-quality public services, we will continue to cut NICs, making work pay. I believe that my neighbour, my hon. Friend the Member for The Cotswolds, outlined the precise wording from the Chancellor yesterday on that.
Of course, this should be seen in the context of our overall record on jobs, which is impressive. Since 2010, more than 2.5 million more people are in work. That is equivalent to 800 jobs created every day of the Conservative- led Administrations.
Michael Shanks
Does the Minister agree, however, that many of those jobs are part of a low-wage economy? The OBR, which he cited, said that in the 13 years of the Conservative Government pay has gone up by just £17 a week, which contrasts with the 13 years of Labour when it went up by £183 a week. Does he agree that many of these jobs are low paid and precarious?
Nigel Huddleston
The hon. Gentleman was clearly not listening yesterday to the Chancellor, who had a key focus on jobs. That is precisely why we are lifting so many people out of poverty and why we have had a focus on increasing the national living wage over the years. Let us not forget that the tax-free allowance was about £6,500 under Labour, whereas it is more than £12,500 now. We have lifted so many people out of paying tax altogether, and that has been a key focus and strategy of this Government.
Jim McMahon
On low income tax payers, by the Government’s own assessment how many people have been brought into taxation because of the freeze on the personal tax allowance?
Nigel Huddleston
The hon. Gentleman is making an important point. I said earlier that, unfortunately, we have had taxes at a higher level than we want, but now we are in a position to reduce them. Reducing them and focusing on NICs is impactful for 29 million workers—anybody earning above £12,500. People now need to earn more than £1,000 a month before they pay any tax whatsoever.
As I said, when we came into power unemployment was near 8%, but it is now about 4%. We should not take full employment, or near full employment, for granted. We all know that every Labour Government have increased unemployment—that is not an impressive record but it is a consistent one.
I particularly want to reflect today on how our plan rewards hard-working families. The Government believe that people’s careers should support rather than undermine another important role: parenthood. That is why at last year’s Budget the Chancellor announced the biggest ever expansion of childcare from September 2025, extending the 30-hour free childcare offer to all children of working parents from nine months old. That will result in an extra 60,000 parents entering the workforce in the next four years. But to deliver on that we need to support the private sector to play its part too, so yesterday we confirmed that the Government are guaranteeing the hourly rate paid to childcare providers to deliver the free hours offer.
Stephen Kinnock
The Minister has not yet mentioned the Government’s damascene conversion on scrapping the loophole for non-doms, but there is a point here about what they could have generated. If they had listened to Labour and done that two years ago, it would have generated an extra £6 billion of revenue, which could have paid for free breakfast clubs for nearly 4.5 million children. So on the point of childcare, does he think that is relevant?
Nigel Huddleston
The hon. Gentleman gave quite a wish list earlier, which, by my calculations, could come out as being quite expensive. I do not know whether he has had conversations with the hon. Member for Leicester West, who is on his Front Bench.
On the hon. Gentleman’s point about non-doms, we will be scrapping the non-dom status, but we will be replacing the system with one that is residency based, including measures that will encourage and incentivise further investment into the UK, because we will be implementing transition measures. I did not hear the Opposition talk about them. Those transition measures are likely to encourage £15 billion of additional investment into the UK. Non-doms at the moment pay about £8.5 billion in taxes. We want to welcome people, but we recognise that those with the broadest shoulders must carry the greatest burden. None the less, we want to be internationally competitive, and the new system that we have proposed will be.
Returning to the childcare measures that I outlined earlier, this commitment would mean over £500 million of additional investment in childcare over the next two years. This will give childcare providers the confidence to invest in expanding at a crucial time, to deliver the free childcare expansion and help bridge the gap between parents’ career demands and their childcare needs.
This approach complements further changes that we are making to the tax system to incentivise parents to increase the hours they work. Yesterday, the Chancellor announced that from 6 April the high-income child benefit charge threshold will be raised to £60,000. In addition, the level at which child benefit is withdrawn completely will increase to £80,000. That was very much welcomed by many Members on the Conservative Benches, including my hon. Friends the Members for Devizes, for The Cotswolds and others. As a result, no one earning under £60,000 will now pay the charge. This will put pounds in parents’ pockets, saving nearly half a million families with children an average of £1,300 a year. According to the OBR, this change will also result in an increase in hours for those already working, which is equivalent to around 10,000 more people entering the workforce full time.
Peter Grant
I am grateful to the Minister for giving way. One of the remaining injustices with the high-income child benefit charge is that a single person earning £60,000 will have to pay the charge, but a couple earning £59,000 each will not, because it is assessed on a single earning. Do the Government have plans to amend that anomaly? If so, when can we expect to see that happen?
Nigel Huddleston
If the hon. Gentleman had not intervened and given me just one more second, I would have said that, going forward, we will also consult on moving the high-income child benefit charge to a household- based system, to be introduced by April 2026. That point was also raised by my hon. Friend the Member for Christchurch (Sir Christopher Chope), who pointed out the potential opportunities in other areas relating to household income. It is important, because our tax system is based on the principle of individual taxation, and there are many aspects of confidentiality and so on that are important in that as well. The Government will consult shortly on options to enable better targeting of economic support to households in times of crisis.
Danny Kruger
I, too, very much welcome that commitment to move towards a household basis for taxation. Does my hon. Friend recognise that most other countries, particularly European countries, operate on a household basis for taxation, because they recognise the obligations that families have to dependants.
Nigel Huddleston
Yes, I hear my hon. Friend but, as I have said, there are some challenges in moving to a household system. There will be a consultation and I am sure that he and others will participate in that, and we will have further discussion in the House.
Nigel Huddleston
I do need to make some progress and respond to comments, and my right hon. Friend the Secretary of State was extraordinarily generous in taking interventions earlier on.
Nigel Huddleston
I am afraid that I cannot take any more interventions, as I have to respond to other colleagues’ questions.
My hon. Friends the Members for Christchurch, for The Cotswolds and the right hon. Member for Leeds West (Rachel Reeves) and others talked a lot about the tax burden. It is important to point out that, taken together, this Budget package and the autumn statement will reduce the tax burden by 0.6% in 2028-29. The tax burden is forecast to be lower than expected in the autumn. The tax system is competitive, when compared with other European nations, such as Germany, France and Italy, which have much higher tax-to-GDP ratios.
The hon. Member for Glenrothes (Peter Grant) and others raised the point about green policies and green energy. Of course, the UK has halved its emissions since 1990, which is faster than any other G7 country. Since September alone, companies have announced plans for £30 billion of new energy investment, and the Budget delivers on the green industry support announcements in the autumn statement 2023, including an additional £120 million for the green industries growth accelerator and other measures.
My hon. Friend the Member for Redditch (Rachel Maclean), who is my constituency neighbour on the other side, not only proudly quoted Margaret Thatcher, which of course always goes down well among Conservative Members, but gave her considered insight into mental health and resilience. She also mentioned productivity, as did several other Members, which was a key theme of the Chancellor’s speech yesterday.
My hon. Friend the Member for Thurrock (Dame Jackie Doyle-Price) and others made important points about the role of local government and local government finance. On 24 January, the Government announced an additional £600 million for local authorities in England. Taking into account that additional funding, the final local government finance settlement for 2024-25 is a 7.5% increase in cash terms on 2023-24.
Several hon. Members mentioned the importance of house building, which of course is a priority for this Government and a central part of our plans for growth. We are on track to deliver 1 million new homes in this Parliament, and have already delivered more than 233,000 homes on average each year since 2019.
The hon. Member for Bristol South said that there is nothing in the Budget for the people of Bristol South. I respectfully suggest that the national insurance cuts that we announced in the Budget will impact thousands of her constituents. She may not appreciate or value that, but I assure her that her constituents will.
Karin Smyth
My point was about the changes that we do not yet really understand in the Budget, and their effect on women in particular. Will there be an equality impact assessment showing how these changes will affect women?
Nigel Huddleston
As the hon. Lady knows, there are always tax information and impact notes—impact assessments —as part of the budgetary process.
My hon. Friend the Member for Folkestone and Hythe, in his very strong contribution, reminded us of not only the context in which we took power in 2010, which was far from the golden legacy that the Opposition received in 1997 when they took power, but the challenges that we have faced in power over the last few years. He was also very enthusiastic, as I am, about the opportunities and progress of the creative industries. That is exactly why we have focused on them, and provided more support measures in the Budget, following on from several measures over the last few years. The creative industries are vital to our economy and future growth, growing on average at about double the normal pace of the economy.
I have to call out the comments of the hon. Member for Warwick and Leamington (Matt Western) regarding the West Midlands Mayor, Andy Street, who has done so much to grow and attract investment in the west midlands. I gently remind the hon. Gentleman that the Labour council is not without its problems in Birmingham.
Nigel Huddleston
I will happily follow up with the hon. Gentleman, but not now.
My hon. Friend the Member for The Cotswolds mentioned VAT RES, which I was absolutely expecting. He made some really important points in many areas. I will happily follow up with him regarding VAT RES. The Government are considering the OBR’s findings about VAT RES, in the context of the wider public finances, but the Chancellor has expressed that he is always happy to receive further representations.
The hon. Member for Halifax (Holly Lynch) mentioned several areas, including SEND, which other colleagues mentioned as well. We know that it is a really important part of the education system and our overall social provision. The Government are investing an initial £105 million over the next four years in building new special free schools, and 20 successful alternative provision free schools as well.
I am aware of the time, so I will conclude my comments. I genuinely thank all Members for their contributions. There have been some extremely interesting contributions today. The hon. Member for Leicester West (Liz Kendall) outlined her vision of a clear choice, which I think we might be hearing quite a lot over the coming months. I do believe that there is a clear choice this year: sustainable economic recovery, sound finances, lower taxes, more productive public services, support for businesses and households, optimism, confidence and opportunity for all with the Conservatives, or reckless spending, unfunded promises, higher taxes, pessimism and negativity from the Labour party, with no hope, no clue and no plan. We have a plan, it is working, and I encourage everyone to stick to the Conservatives, and not to risk a Labour Government.
Ordered, That the debate be now adjourned.— (Mr Mohindra.)
Debate to be resumed on Monday 11 March.
Pavement Parking
(2 months ago)
Commons ChamberRead Full debate Read Hansard Text Watch Debate Read Debate Ministerial Extracts
Liz Twist (Blaydon) (Lab)
I rarely have the chance of speaking two times on one day in quick succession.
I am glad to have secured this debate, but I am sad that we are having to revisit the topic. My first Adjournment debate in this House on 6 June 2018 was on pavement parking. I am sorry that nearly six years on, we are still only talking about preventing it. I am by no means the only person to have raised this subject, as the Minister knows. Since that debate, we have had promises to resolve the problem, a few Government announcements and even a consultation three years ago—but still no Government response, much less any action.
Guide Dogs set out well what has been happening. It pointed out that it has supported private Member’s Bills in the House of Commons in 2014 and 2015, which contributed to the Department for Transport decision to commission research on pavement parking. The Department subsequently held a consultation on managing pavement parking between 31 August and 22 November 2020, exploring three options: first, to improve the traffic regulation order process by which local authorities can already prohibit pavement parking; secondly, a legislative change to allow local authorities civil parking enforcement powers to enforce against unnecessary restriction of the pavement; and, thirdly, a legislative change to introduce a London-style pavement parking prohibition throughout England. Guide Dogs supported all three, but it strongly emphasises the third option, to introduce a law across the rest of England.
Afzal Khan (Manchester, Gorton) (Lab)
I thank my hon. Friend for securing this important debate. In Manchester, pavement parking continues to prevent people from participating in everyday life, especially vulnerable and disabled people. Back in May 2023, I petitioned Parliament to outlaw pavement parking across the country. That had huge support from my constituents and local authorities, but the Government have done nothing about it. Does she share my concern that the Government continue to show their contempt for the people of Britain by failing to enforce simple measures that would greatly benefit the public?
Liz Twist
I absolutely agree with my hon. Friend.
The argument for a pavement parking ban needs little restatement. All the organisations that have contacted me since I secured this debate are largely in agreement. They say that pavement parking puts pedestrians in danger, including disabled and older people, as well as parents with children, and that the Government must take action. Locally, I know, there are major issues with the school run for parents and children negotiating parked cars. From my constituents who raised this issue, I know it is clearly one that is deeply felt. I am sure that they are not alone in that in Blaydon. Residents regularly tell me about the problems pavement parking causes outside the little shops in Winlaton, along the high street in Birtley or even just up from my home along the main road in Ryton.
Guide Dogs UK has done a lot of work on this issue because pavement-parked vehicles pose a particular risk to people with sight loss, blocking their routes, creating trip hazards and forcing them to walk on to roads full of traffic which they cannot see. Research by Guide Dogs has found that virtually all people with sight loss have been forced to walk in the road due to pavement-parked vehicles. Some 80% of respondents said that pavement parking affects them weekly, while one in five said that they had been injured as a result of it. A third of people with sight loss said that they are less willing to go out alone just in case they come up against vehicles blocking their path. It is deeply unjust that people with sight loss should have their everyday lives disrupted because of this issue.
In my last Adjournment debate, I talked about my experience of meeting Margaret and Laurel, constituents of mine who are both visually impaired, and taking a walk with them blindfolded, or with restrictive glasses, on my local street. At the time, they told me that they had lost confidence in going out alone, and that their independence was at risk because of the number of vehicles parked on the path. I had the chance to catch up with Laurel ahead of this debate, and I am sad to say that little has changed for her in the past six years. She shared with me the following message:
“Where I live, all the houses are built in the 1950s and many don’t have their own drive. As a result, everyone parks their cars on the pavement. You can’t get past them, and often Tasha, my Guide Dog, and I have to walk in the road. It’s not just the one car we have to get past—I frequently have to go in the road to get past a few of them, which is so frightening as you can’t hear bikes or quieter cars. If I try to get past without going on the road, I find that I often hit my head on the wing mirrors, which is unnerving in itself.
I want to be independent and use the pavement without having to get help, but there are so many cars about that it’s getting harder all the time. I recently went to catch the bus but found there were cars parked each side of the bus stop pole, stopping me from waiting there, and preventing the bus from pulling up. I had to step out into the road to get to the door of the bus, which was nerve racking. You don’t know what might be coming towards you and you are putting yourself and your guide dog in danger. Because I’d had to step down into the road, the step onto the bus wasn’t at the height I’m used to, and I missed it and fell, really hurting myself. The driver didn’t help and just said he’d report the problem.
On another occasion when I was coming home, the bus got to my stop and struggled pulling into the curb because of the cars. The driver actually stopped right in front of the pole so that it was right in front of the doors when they opened. If I’d got out, I’d have walked straight into it but fortunately, my son was with me on that occasion, and he grabbed hold of me to stop me.
I feel really angry because people parking on the pavements just don’t realise what problems they cause Tasha and I when we’re out, and I want someone to stop this happening.”
The focus of my debate is the problems that we are having in my Blaydon constituency, which, as the Minister knows—it is next to his constituency—is in the north-east. I note that the north-east deeper devolution deal, which was published yesterday, contains a section that addresses pavement parking. The North East Mayoral Combined Authority’s stated intention to develop a consistent approach to enforcement is laudable, and I know that my local authority, Gateshead Council, has previously looked at what it can do to help with the problem, but identifying streets and issuing traffic regulation orders is a lengthy, impractical and costly process, and local authority civil enforcement officers have few powers where there are no lines or signs present. That is why so many organisations and local authorities have called for a system that allows for blanket prohibition, such as the one that currently operates in London, with the potential to allow for exceptions where local geographies or street designs make them necessary.
The national consultation was set up to consider what the Government could do to support councils to take action on this issue. I gently remind the Minister that that consultation took place in 2020, and it stated that a summary of responses would be published within three months of its closing. It has now been 1,285 days since the consultation closed, but we are without a substantive update. That is without considering the dawdling that took place prior to the consultation, which I understand the Government had initially planned for early 2017, or—to look even further back—the time that has elapsed since the hon. Member for North Dorset (Simon Hoare) introduced a private Member’s Bill on this issue in 2015.
In a debate in the House of Lords only a few weeks ago, the Under-Secretary of State, Lord Davies of Gower, told that House:
“Yes, it is time and I am hopeful that in the not-too-distant future we will come out with a report on this.”—[Official Report, House of Lords, 21 February 2024; Vol. 836, c. 607.]
I can understand that the 15,000 responses that I believe were submitted need to be looked at, and that considering them takes some time, but from hearing those words from Lord Davies, one could be forgiven for assuming that the Government were just running a tad over the deadline. We are now more than three years on, and it is disappointing that the Government cannot promise us anything better than vague hopes for a response.
Afzal Khan
I thank my hon. Friend for being generous in giving way. A recent Sustrans report found that 49% of people in Greater Manchester wish to walk or use their wheelchair more, and 40% want to cycle more. Does she agree that if the Government banned pavement parking nationally, that would improve the accessibility of our footways, make our streets safer, and encourage people to choose active travel alternatives to cars?
Liz Twist
My hon. Friend makes an important point. We are all looking to develop active transport policies, and making it easier for people to walk on pavements and use public transport safely is a real issue, so I very much welcome that report.
As I have said, 15,000 responses might be a lot of paperwork to get through, but they also suggest a high level of public engagement and interest in this issue. The Government owe it to disabled people, as well as the wider public, to ensure that they complete this process. As such, I ask the Minister whether the Department for Transport will commit today to urgently publish the response to the consultation on managing pavement parking, and to set out a timetable for introducing legislation.
Everyone should feel safe and confident when using pavements in their local area, but so many people, including many families walking to school, are suffering. People like my constituents Laurel and Margaret are suffering from social isolation and a loss of independence due to the lack of action on this issue. People with disabilities must not be an afterthought, so I hope that the Government will stop taking them for a ride, crack on and address their concerns.
The Parliamentary Under-Secretary of State for Transport (Guy Opperman)
I congratulate the hon. Member for Blaydon (Liz Twist), who is my constituency neighbour, on securing this Adjournment debate on what is genuinely a very important issue—I do not diminish it in any way whatsoever. I acknowledge that the hon. Member for Manchester, Gorton (Afzal Khan) has also previously raised this matter in the House. I have had my brief for about 100 days, and have taken the trouble to read transcripts of the previous debates.
I am also acutely conscious that a vast amount of evidence has been provided by a large number of organisations. Like the hon. Lady, I have met Guide Dogs UK, and I know that this is a very serious issue that affects individuals up and down the country in a genuine and serious way, including people who are disabled, those who have children, those with prams and buggies, those who are walking their dog and those who are engaging in active travel, for which I am also the Minister. We have increased the budget for encouraging active travel by 10, and we are trying to persuade people to get behind it, so I do not want to diminish the importance of this issue in any way. I acknowledge that it is very serious.
As the hon. Member for Blaydon knows and has previously outlined, there has been a total ban on pavement parking in London since 1974. However, to be fair, successive Governments of different political persuasions have decided since 1974 that there should not be a nationwide ban. That is partly because London is clearly a different environment from other parts of the country, particularly in terms of rurality. However, she will also be aware—I am repeating things that both she and the hon. Member for Manchester, Gorton know—that there are traffic regulation orders, as well as prescribed traffic signs and bay markings.
To give some context, the Transport Select Committee’s report in September 2019 was highly detailed and took huge amounts of evidence, and to a certain extent triggered the Government to respond. That Committee sought reform of the TRO process, a change in the legislation governing the enforceable offences of obstructive pavement parking—as I will deal with later, that legislation is not simple by any stretch of the imagination—and consideration of a nationwide ban in some shape or form.
As a result, and following consideration and, rightly, extensive debate in the House on an ongoing basis, there was the consultation. As the hon. Member for Blaydon says, 15,000 people responding to a Government consultation is probably more than any other that I am aware of—certainly in the transport space. When I was the Employment Minister, I was not aware of such detailed consultations. Clearly, there are some that do generate more than that, but this was not just on the three main points, because bear in mind that there were 15,000 responses on 15 different issues. That produced, as she rightly outlined, thousands of pieces of individual feedback, all of which need to be read and analysed. An awful lot of different Departments need to consider different matters, and local authorities are utterly key to that, as is the Department for Transport and the like.
I want to make the point that we understand the issues, and if we did not understand them before the consultation, we most definitely do now. There are obviously inherent dangers for all pedestrians, and the hon. Lady rightly identified the particular situations for her constituents, for whom I have genuine sympathy. However, it must be recognised that many towns and cities—as was clearly set out in the Transport Committee report and the consultation the Government undertook—are not designed to accommodate today’s traffic levels, and in some locations the pavement is the only place to park without obstructing the carriageway, not least because there needs to be a free flow of traffic for the emergency services, which is a factor that the Government have to consider.
Liz Twist
I understand that issue, and I understand that one of the proposals is to have a blanket ban, but allow opt-outs in particular circumstances. That is clearly necessary, and I do not think anyone is arguing that there are not circumstances in which that would be the case. However, this is sounding as though we are not getting to a conclusion and that we are not going to have a decision on this issue, because it is too difficult. Is that right?
Guy Opperman
No, I think that is a slightly unfair, with great respect. I endorse entirely the comments of my noble Friend Lord Davies of Gower, who responded to that specific point in the House of Lords very recently. He specifically said that the Government were coming to a conclusion very soon. I have unquestionably become aware of that since having taken up this post, and it will unquestionably be decided in the very near future. I do not want the hon. Lady to walk away from this debate thinking that this is not under consideration.
As the hon. Lady knows, existing legislation allows local authorities to introduce traffic regulation orders to manage traffic. Examples are one-way streets or banned turns, and the TROs also allow local authorities the freedom to decide if and how they wish to restrict pavement parking in their local area. However, we acknowledge—and the consultation clearly shows—that the process of making a TRO can be time-consuming and burdensome for local authorities, and it is clear that that requires reform. What reform looks like is not simple, but we unquestionably feel there is a capability to do that. There is also scope to reduce the cost of this process, because there is undoubtedly a lot bureaucracy and time that goes with it. If one could introduce a digitised, non-paper-based system, that would speed up applications and clearly make communication better. There is a clause to make that change in the Automated Vehicles Bill, which is going through the House and had its Second Reading earlier this week, and that will make it quicker and cheaper for local authorities to implement TROs.
The second recommendation was about unnecessary obstruction of the road. There are already some criminal offences in this space, and we are looking at how we amend the regulations to make unnecessary obstruction of the pavement enforceable by local authorities, while leaving obstruction of the carriageway, rightly, as a criminal matter. This would label civil enforcement officers to address instances of unnecessarily obstructive pavement parking, as and when they find it. The enforcement of these offences would be more targeted than for a general prohibition of pavement parking.
Afzal Khan
The Minister has accepted that we have laws in London but not in the rest of the country. Would it not be consistent to have the same law across the board? After all, London is not the only important city. Cities such as Manchester or Birmingham are also important.
Guy Opperman
This option has challenges. Parking offences currently subject to local authority civil enforcement are violations of clearly defined restrictions indicated by traffic signs and road markings. By contrast, unnecessary obstruction that could not be indicated by traffic signs or bay marking as an obstruction is a general offence, which may occur anywhere. That is difficult to define and will require case-by-case assessment. The Department will likely need to issue very specific guidance to steer local authorities on what might be deemed unnecessary obstruction in order to prevent inappropriate and inconsistent enforcement.
The third option is a national prohibition. That is being considered, but there was considerable pushback against it in certain circumstances. As the hon. Member for Blaydon outlined, one would have to assess how it would possible in circumstances where there are significant and large local authorities, particularly rural ones, which would struggle to make the specific decisions on exemptions. However, we are looking at that particular situation to make a decision on where pavement parking would be necessary. A local authority would have to limit the necessary exemptions, and install traffic signs and bay marking to indicate all the places where pavement parking was to be permitted. That would be extremely difficult, particularly in rural areas. However, it is not by any stretch impossible.
Consideration also needs to be given to whether a ban would be disproportionate. I mentioned the rurality issue, but I want to finish on one key point. One can talk about the relative merits or otherwise of local government, and whether the London approach is the panacea that we all seek to say it is, but this is ultimately about the personal responsibility of the vehicle owner. I really want to ram home the point that, as is set out in the gospel, “do unto others as you would have done to yourself.”
Guy Opperman
I will not take a further intervention. It is unquestionably the case that we need to send a strong message to the drivers of this country that it is incumbent upon them to park responsibly, to look after their neighbour, and to be conscious of the wider impacts of their decision to own a car, so that in their street and community, they are accommodating the people who are struggling.
Question put and agreed to.
Investigatory Powers (Amendment) Bill [ Lords ] (First sitting)
Thursday 7th March 2024
(2 months ago)
Public Bill CommitteesRead Full debate Investigatory Powers (Amendment) Act 2024 View all Investigatory Powers (Amendment) Act 2024 Debates Read Hansard Text Read Debate Ministerial Extracts Amendment Paper: Public Bill Committee Amendments as at 7 March 2024 - (7 Mar 2024)
The Chair
Before we begin line-by-line consideration, I have a couple of announcements. Hansard colleagues will be immensely grateful if Members email their speaking notes to hansardnotes@parliament.uk. Please switch off electronic devices or turn them to silent. Tea and coffee are not allowed during sittings. Today, we will first consider the programme motion on the amendment paper. We will then consider a motion to enable the reporting of written evidence for publication. I hope we can take these matters formally without debate. I call the Minister to move the programme motion standing in his name, which was discussed yesterday by the Programming Sub-Committee for this Bill.
Ordered,
That—
1. the Committee shall (in addition to its first meeting at 11.30 am on Thursday 7 March) meet—
(a) at 2.00 pm on Thursday 7 March;
(b) at 9.25 am and 2.00 pm on Tuesday 12 March;
2. the proceedings shall be taken in the following order: Clauses 1 to 14; the Schedule; Clauses 15 to 33; new Clauses; new Schedules; remaining proceedings on the Bill;
3. the proceedings shall (so far as not previously concluded) be brought to a conclusion at 5.00 pm on Tuesday 12 March.—(Tom Tugendhat.)
Resolved,
That, subject to the discretion of the Chair, any written evidence received by the Committee shall be reported to the House for publication.—(Tom Tugendhat.)
The Chair
Copies of written evidence received by the Committee will be made available in the Committee Room, and will be circulated to Members by email.
We now begin line-by-line consideration of the Bill. The selection list for today’s sitting is available in the room; this shows how the selected amendments have been grouped together for debate. Amendments grouped together are generally on the same or a similar issue. Please note that decisions on amendments do not take place in the order they are debated, but in the order they appear on the amendment paper. The selection and grouping list shows the order of debates. Decisions on each amendment are taken when they come to the clause to which the amendment relates. Decisions on new clauses will be taken once we have completed consideration of the existing clauses of that Bill. Members wishing to press a grouped amendment or new clause to a Division should indicate when speaking to it that they wish to do so.
Clause 1
Requirement for authorisation
Question proposed, That the clause stand part of the Bill.
The Minister for Security (Tom Tugendhat)
It is a pleasure to be here under your chairship, Mrs Cummins. The exceptional growth in volume and types of data across society globally since 2016 has affected the intelligence services’ ability to work and collaborate at the necessary operational pace. The existing bulk personal dataset safeguards do not account for the way that data and its availability have evolved since the Investigatory Powers Act 2016 was passed. This creates a negative impact on operational agility, while making it increasingly difficult for the intelligence services to develop the necessary capabilities.
Clauses 1 and 2 introduce an alternative regime for bulk personal datasets where there is low or no reasonable expectation of privacy—the so-called low/no regime. Clause 1 specifically provides a mechanism for the intelligence agencies to determine whether bulk personal datasets should be authorised under part 7 of the 2016 Act for sensitive datasets, or proposed new part 7A for low/no datasets.
Dan Jarvis (Barnsley Central) (Lab)
It is a pleasure to serve under your chairship, Mrs Cummins. I rise to speak very briefly to clause 1, and to thank the Minister for his opening remarks.
At the outset of our consideration, we should all take the opportunity to pay tribute to the exceptional men and women who have served in our law enforcement and security services. We owe them a deep debt of gratitude. Let me say that the Opposition support the Bill, which updates aspects of the Investigatory Powers Act 2016. It is imperative that legal frameworks are updated to ensure that our security and law enforcement services keep up with the challenges to communications technology in an increasingly challenging and complex landscape of threats to our safety and national security. None the less, the important provisions proposed in this Bill need to be scrutinised carefully. The shadow Home Secretary and I made it clear on Second Reading that we will work with the Government to improve it in places, following the example of the constructive cross-party work that was done in the other place.
Stuart C. McDonald (Cumbernauld, Kilsyth and Kirkintilloch East) (SNP)
It is good to see you in the Chair, Mrs Cummins.
I echo what the shadow Minister says. We are all here to assist the brave personnel in our security and intelligence services, but that does not mean that we will not closely scrutinise this legislation. We did not oppose the Bill on Second Reading. Some parts are good, but we have indicated our serious concerns about other parts because we think the powers go too far. They have not been shown to be necessary and proportionate; rather, they are more for the convenience of the security and intelligence services. How these powers are drafted also causes us concern, because they seem to allow behaviours beyond what we were told the powers were going to be used for. At other times, it is the nature of the oversight that is a concern, as the Bill introduces potentially intrusive powers.
I have one other brief point to make, which I indicated I would make at last night’s meeting of the Programming Sub-Committee. I had hoped that this morning we could perhaps have had some witnesses to guide us through this process. I think that would have been very helpful. It was very helpful in 2016, when we were looking at the original legislation, and I regret that we do not have such an opportunity this morning.
The provisions on bulk personal datasets and so-called low/no datasets are an area where we fear that the legislation is rather more a matter of inconvenience than something that has been shown to be a necessity. That will emerge in the debate about clause 2, which contains quite a lot of the detail about how the regime is supposed to work. Basically, we have been told that there will be a significant increase in the use of bulk personal datasets. We have been told that scrutiny is too slow, so we will either have to remove it or, perhaps more accurately, water it down in relation to these so-called low/no datasets. Fundamentally, I do not like that argument. The Minister will need to make a compelling case.
When we discuss clause 2, it would be useful if the Minister told us how many bulk datasets are retained and examined each year currently; how many datasets it is envisaged will be retained and examined after these powers come into force; what percentage of the datasets he thinks would be considered low/no datasets; how long authorisation processes take currently and why they take that length of time; and why cannot we improve or accelerate that process in some way, rather than having to water it down in the way that this Bill suggests. We will ask the Minister for that sort of evidence, because he is asking us to do away with parts of the oversight system that were put in place in 2016, and we want to understand how that oversight system is causing a problem at the moment. If he cannot explain that, we cannot support this new regime.
Mr Kevan Jones (North Durham) (Lab)
It is a pleasure to serve on this Committee with you in the Chair, Mrs Cummins.
My hon. Friend the Member for Barnsley Central said very clearly that there is general support for the Bill. The need for it is self-evident: things have moved on since the passage of the 2016 Act—indeed, they have moved on very quickly in terms of the amount of data there is, not only data that the security services have to deal with but data in general life.
Bringing the legislation up to date is important, but if we look at the Hansard reports of the debates in 2016, when the right hon. Member for South Holland and The Deepings took the original legislation through the House, we see that there was then, quite rightly, concern that the state acquiring bulk data was intrusive into people’s private lives.
Having read those Hansard reports a couple of days ago, I accept that some of the concerns expressed in 2016 were overblown, as are some of the concerns expressed about this Bill. Frankly, if the accusations regarding what our security services are able to do were true, they would be 10 times, if not 100 times bigger than the actual security services we have today. Nevertheless, it is important in a democracy to ensure that the security services act proportionately—I am confident that they do—and that there is the necessary oversight of their actions and how they deal with the data they have. It is not just parliamentarians who need reassurance in that regard, but the public. The public need reassurance about the data that the state is holding.
Examples have been given, but frankly, they are a bit silly, because things such as the electoral register, which you, Mrs Cummins, I and everybody else can access, fall under the existing regime. The expectation that the data will not be made public is ridiculous, and the same is true of some of the other examples that have been given. For instance, some datasets for machine learning are open on the internet for everybody to see. I do not have any problem with that and I do not think that anybody else does.
Oversight, which we will discuss later, is important. We are giving the security services the powers to determine what is low and what is no. Do I trust that they will have the protocols in place to ensure that that process is done fairly? Yes I do, but I have been on the Intelligence and Security Committee for the last seven years; I know exactly how the protocols work internally in those organisations. To reassure the general public, we need a definition of how this process will take place. I will not touch on that now, but later I will raise the question of how we will have independent oversight of that process.
Neither I nor anyone else is saying that we distrust how the security services will handle those datasets, but one thing the ISC has been very clear on is that if we are going to extend the security services’ powers, there needs to be a corresponding extension of oversight to balance that. I do not want to put in place oversight that prevents operational effectiveness; it would be silly to give the security services powers and then make it impossible or too onerous for them to operate in practice, but striking a balance is important in a democracy.
We broadly got that balance right in the 2016 Act. Looking at international comparisons, we are way ahead of many other democracies in how we deal with oversight of those potentially very delicate issues.
Sir John Hayes (South Holland and The Deepings) (Con)
I will not detain the Committee unduly, my Whip will be pleased to know. However, I feel it is important at this juncture—in part because, as the right hon. Member for North Durham says, I was responsible for taking the 2016 legislation through the House, and in part because of my current role on the ISC—to make some comment on the first part of this Bill, which deals with bulk powers. There are misassumptions about bulk powers. The Minister will be aware of how vital they are to the security and intelligence services and to the police. These powers are used in almost all investigations —95% of them—and they are critical if we are to deal with the changing character of the threat we face.
Contextually it is important to note that when the 2016 Act was passed, the nature of the threat was metamorphosising, and that is even more the case now. The scale and character of the threats are altering all the time, so the legal powers available to those we mission to keep us safe need to be fit for purpose and up to date. We knew that when we passed the 2016 Act; we knew that the legislation was dynamic and that it would be supplemented over time to take account of that metamorphosis, which takes two forms. First, the threat now is probably greater from state actors, and secondly, it is greater from those inspired to do harm via the internet in particular. That situation makes an implicit case for the kind of measures the Minister has brought before us today.
Furthermore, there is a paradoxical change in the methodology used by those who seek to do us harm. Because of the nature of technology, those people are now able to do things that they were not able to do when we debated the original Act that this Bill amends. I describe the change as paradoxical because those people have simultaneously learned that they can do immense harm with a vehicle and crude weapon; we know that from some tragic cases in recent years. Those inspired people do not need a sophisticated organisation with all kinds of capabilities; they simply need the perverse, indeed perverted, will to do damage. All of those factors legitimise the case for the measures in the Bill, which we will consider over the coming hours and days—but not weeks I am pleased to say, unless something goes badly wrong.
Tom Tugendhat
What can I say? We have got a little further on clause 1 than I anticipated. I am grateful to my right hon. Friend the Member for South Holland and The Deepings, the right hon. Member for North Durham and other hon. Members who have spoken. Bulk personal dataset authorisation is clearly an important change, as my shadow, the hon. Member for Barnsley Central, has set out; I was interested to hear the suggestion from my right hon. Friend the Member for South Holland and The Deepings that this was the shadow Minister’s first step on the path to greatness and to leading the Opposition. I am grateful for the points that hon. Members have made.
The type of data that may fall into part 7A is indeed covered—things like news articles, academic papers, public and official records, and the sort of bulk personal data that many people would have access to routinely. The changing nature of the need to hold data has meant that bulk personal data must be authorised in a different way than was previously thought. Paragraphs 4.14 and 4.20 of the draft code of practice set out further details of the datasets that would fall under the section 22A test, of which the hon. Member for Barnsley Central is no doubt aware.
The hon. Member for Cumbernauld, Kilsyth and Kirkintilloch East touched on various aspects of data that might fall within this approach. He will remember that Lord Anderson noted in his independent review that MI5 and MI6 estimate that roughly 20% of their bulk personal data holdings would fall into the category of “low and no”; for GCHQ, the figure would be nearer to 8%. Clearly, these things will evolve. To answer the point made by the right hon. Member for North Durham, the simple fact is that our world is producing incomparably greater volumes of data than ever before. The need to understand, handle and triage that data is therefore essential.
It is worth making the point, right at the beginning, that creating and storing huge volumes of data is to nobody’s advantage, and particularly not that of the intelligence services. The only purpose of having or examining data is to enable investigatory operations to get to targets of interest. It is not about anything other than ensuring that investigations can be properly targeted against those who threaten the interests of the British people, under various existing laws. This measure does not change those laws; it merely assists the targeting.
Question put and agreed to.
Clause 1 accordingly ordered to stand part of the Bill.
Clause 2
Low or no reasonable expectation of privacy
Dan Jarvis
I beg to move amendment 14, in clause 2, page 3, line 18, at end insert—
“(1A) This section does not apply to a bulk personal dataset unless it has been published in accordance with the Data Protection Act 2018.”
This amendment would ensure bulk personal datasets with low or no expectation of privacy have been published lawfully and in accordance with General Data Protection Regulation (GDPR) set out in the Data Protection Act 2018.
The Chair
With this it will be convenient to discuss amendment 21, in clause 2, page 3, line 34, at end insert—
“(4) By way of example, bulk datasets of images obtained by CCTV and bulk datasets of Facebook posts are not to be considered datasets where the individuals to whom the data relates could have no, or only a low, reasonable expectation of privacy.”
Probing amendment regarding the scope of “low or no reasonable expectation of privacy”.
Dan Jarvis
May I reflect on my gentle amusement at hearing the Minister’s remarks about a former shadow Security Minister and his onward passage to becoming Leader of the Opposition? I know that these are matters on which he speaks with great authority.
We have already had very helpful contributions from two senior Intelligence and Security Committee members. Questions about the meaning of “low or no reasonable expectation of privacy” in relation to BPDs have been raised throughout the Bill’s progress in the other place and on Second Reading in this House, including by members of this Committee. The amendment seeks to probe the meaning of the phrase, but I should be clear at the outset that I do not intend to divide the Committee on this or any other amendment on which I intend to speak.
I will set out two scenarios. It would be genuinely helpful if the Minister could clarify the limits to the factors relating to the Data Protection Act 2018. The first scenario is where the data can be attributed to a leak that, although unintentional, resulted in the unconsented publication of personal information in the public domain. Would a leak of the personal details and working patterns of the staff of Members of this House—a number of hon. Members will remember the one that happened in March 2017—be subject to a low or no reasonable expectation of privacy?
The second scenario is the deliberate and unlawful publication of personal information into the public domain. If there were a hack resulting in the unlawful publication of personal information into the public domain, would that information also be subject to a low or no reasonable expectation of privacy? Data breaches of that nature occur regularly: the personal information of more than 2 million Duolingo users was compromised last year. A user’s mastery of French verb conjugation is unlikely to be of interest to anyone, with the possible exception of our friends over the channel, but other personal information could be. The Duolingo data was put up for sale on the dark web, so it might be regarded as third party BPDs. It is important that the Minister clarifies the meaning of “low or no reasonable expectation of privacy” in relation to those two scenarios.
Labour Members are not opposed to the concept of “low or no reasonable expectation of privacy” in relation to BPDs. We want to ensure that the police and security services are not unnecessarily limited in their intelligence gathering, but there need to be parameters for what is considered fair game. There must be clarity on important definitions relating to personal data. I hope that the Minister will respond in the constructive spirit in which the amendment was intended.
Stuart C. McDonald
Clause 2 will remove the need for further judicial authorisation for personal dataset retention and examination if the datasets are deemed to fit into the low or no category, for which there is already authorisation, or if there is urgency. Many personal datasets can be contained within one warrant, so we have lots of questions about how proposed new part 7A will work. Amendment 14 demands an explanation of how the regime fits alongside data protection standards and how it applies to leaked and hacked datasets, as opposed to those that are lawfully obtained.
Our amendment 21 simply seeks to push the Minister to give examples of personal datasets that would be considered to have a low or no reasonable expectation of privacy. I refer hon. Members to a letter from the Chair of the Joint Committee on Human Rights, my hon. and learned Friend the Member for Edinburgh South West (Joanna Cherry), which has been shared with us all:
“There is perhaps some ambiguity or confusion as to what data is envisaged to be caught by these provisions. For example, is it merely online encyclopaedias, Companies House registers or news articles; or would it also cover, for example, quite extensive discussions over the internet or mass voice or face images, as has been mentioned in evidence?”
That is the question that we are getting at here.
The whole concept of a reasonable expectation of privacy seems to have been borrowed from the US, where it has been criticised for permitting fairly intrusive surveillance at quite a considerable scale. To my mind, it difficult to grasp the concept or even understand how the test to be applied. It is bad not just for citizens in general, but for people who are having to make these decisions who are not absolutely clear whether or not they can consider a set of data to have a low or no expectation of privacy.
Would bulk datasets of CCTV images or Facebook posts be no/low? How can someone assess whether a bulk personal dataset falls into the category if they do not know all the information within it because they cannot see it until they have a warrant? If the dataset contains information about many thousands or millions of people, with different types of information about different people, how can there be one single level of expectation? People with a low expectation of complete privacy might reasonably have a high expectation that their data will not be retained and processed by the intelligence services.
Why is the sensitivity of the data not expressly mentioned in the Bill? That should surely be pivotal, particularly if the Government want to operate within our human rights obligations. There is no clarity in the Bill to reassure us that sensitive information such as health data would absolutely not be captured by these provisions. Why could that not be on the face of the Bill? Why is publication the important factor instead? Publication in the context of small Facebook groups, for example, does not mean that there are no expectations that security services would not hold that information.
Mr Jones
My hon. Friend the Member for Barnsley Central has been trying to put a definition around this. That needs to happen. If it is not to be in the Bill, the Minister needs to put on the record exactly what his expectations are, because I can see this being challenged in court. Courts are very good at looking back at what is said and what is actually meant in Parliament, so it is quite important.
There are certain categories that no one has any problems with: open Companies House registers are available to anybody, for example, and so is the open electoral register. But how will the closed electoral register be dealt with? I would argue that people who want to be on the closed register would think that there was a reasonable expectation that that data would not be shared. We know that it is, but somebody might challenge that.
Likewise, there are telephone directories. I am not sure whether they are produced any more. Perhaps I am old-fashioned—I am showing my age now. [Interruption.] Well, I am sure they still exist in a digital format. Those who are old enough to remember will know that there was an ex-directory option for people who did not want their name published; someone could make a conscious decision that they did not want their private phone number to be in the public record. Now it must be all online, but how will that be dealt with? With a directory on which everyone’s number is publicly available, I would think that there was a reasonable expectation that that was public data; I think everyone would assume that. Where they are ex-directory, however, I think most people would reasonably expect their data not to be shared with anybody.
“No expectation of privacy” is very clear—it means things that are publicly available—but “no reasonable expectation” is a dance on the head of a pin. People’s interpretations of what is reasonable will be different. I am reassured that the agencies have protocols for dealing with that, and I am not suggesting for one minute that they will be on fishing expeditions, but we need some clarity on what it all means.
The hon. Member for Cumbernauld, Kilsyth and Kirkintilloch East made a point about Facebook and other types of social media. For those who are interested, my “North Durham morning” posts are on Instagram, Facebook and Twitter, or X. I have been doing them for many years.
Mr Jones
I have no reasonable expectation that those posts are private. I am not suggesting that the security services will want to look at North Durham mornings, but those posts are something that I have put in the public domain. That is fine, but it is different from what the hon. Member for Cumbernauld, Kilsyth and Kirkintilloch East was talking about. We might share a photograph or information on a small Facebook group, but do we expect everyone to have access to it? I am not sure that we do. Where does that fit into the definition of “reasonable expectation”? Would the individual think that it was available? That is the point.
Sir John Hayes
The right hon. Gentleman is making a persuasive argument about public expectations of what is reasonable versus what the Bill says and what the agencies do. He is right that there are good operational validations through the agencies’ protocols, but perhaps the best way of explaining the marriage between expectation and what is real would be by example. It would be helpful to hear some examples from the Minister of how the powers that are currently used, and those that will be used under the Bill, are necessary and proportionate; for all these things are about necessity and proportionality. By example, we can probably put this matter to bed.
Mr Jones
Yes. A point was also raised about leaked data. If something is leaked on the internet or any other portal and everyone has access to it, do we then assume that the security services think that it comes under “reasonable expectation”, even though the individual whose data it was perhaps did not want it out there?
I accept that under proposed new section 226B(4)(b),
“the authorisation is necessary for the purpose of the exercise of any function of the intelligence service”,
which is fine. I do not think that people will go on fishing expeditions—we will come on to that issue later— but I note that the phrase “economic well-being” appears later in the Bill, but not in this part. When I have raised the point before, the Government have argued that the phrase is used in other legislation and that they want to be consistent.
If nothing is to be changed in the Bill today or on Report, the Minister needs to put something on the record so that it when somebody challenges this provision in future, which they will, the Government’s intention is clear now and can be interpreted later.
Owen Thompson (Midlothian) (SNP)
I will be brief. I back up the comments of the right hon. Member for North Durham: much more needs to be done to define clearly what we mean by “low or no”. In many ways, separating the two out would make everything clearer. Everybody can tell what “no expectation of privacy” means. It is when we get to low expectation of privacy that we have debates: “Is it this or is it that?”
The factors considered in determining whether something qualifies as low or no include
“the extent to which…the data has been made public”.
If there is no expectation of privacy, that is obvious, so I do not understand why we cannot have more clarity and say, “This is what we mean by no expectation of privacy, and this is what we mean by low.” It might be fine for us in this room to have an understanding of what we mean, but there needs to be public understanding.
We all know that every time we go on any website, we are asked to click to accept the cookies, and sometimes we cannot progress any further unless we do. Data is being gathered left, right and centre. With the best will in the world, not everyone reads every single line of the terms and conditions. We need to be absolutely clear about exactly what we mean so that legal challenges do not occur down the line.
Tom Tugendhat
Before I address those points, I want to address the shadow Minister’s somewhat contentious argument that learning French is not a security issue —that was a bold innovation from him.
The points that have been raised are essential to understanding exactly why the Bill is so important. I will cover the “no” and “low” areas separately, for the reason that the hon. Member for Midlothian touched on. We all know what no expectation is; that has been largely covered, and the reality is that even the slightly more restricted version of the electoral register is shared with political parties, as the right hon. Member for North Durham knows.
Tom Tugendhat
That is what I was going to say. Although the register is not publicly available and therefore would not fit in this category, that is where we get to the line. The “no” is for publicly available data, and that is relatively clear.
The “low” comes in areas such as the idea of leaked papers, which somebody raised—forgive me, I cannot remember who. That is where the Bill sets out terms under which datasets should be considered, because of course it is impossible for me to give an answer that applies to every single dataset into the future. One example that came up recently, as right hon. and hon. Members will remember, is the Panama papers. One would not argue for a second that the people listed in those papers had an expectation of openness initially. However, after those papers had been published and republished over many years, at what stage do we really think the expectation of privacy is maintained?
That is where the dataset becomes low expectation. We have set out the oversight regime in another area of the Bill, but I will touch on it. The Investigatory Powers Commissioner has a range of responsibilities, the judicial commissioners have other responsibilities for approving warrants and IPCO has responsibility for overseeing the regime. That is where that is addressed—in slightly ways at each moment of influence and each moment of power, but everything is covered.
Kevin Foster (Torbay) (Con)
I am interested in the Minister’s example of the Panama papers. As he rightly says, when those papers were originally held by a bank or a financial institution, there would be an expectation of privacy. However, he is alluding to where they are sourced from. Those papers have been freely circulating on the open internet and anyone can download them, and it is at that point that the low or no expectation would come in. Rather than the nature of the document itself, it is the fact that it is easily available online that matters.
Tom Tugendhat
My hon. Friend is absolutely right. The reality is that once papers are effectively public, the argument for privacy somewhat falls away. That is exactly where we are getting to in this area, which is why we have looked at how to oversee it and the different elements within it. Part 7A explains the oversight regime clearly and section 226A really gets to the nub of it.
It is important that we focus there, where the argument comes back to the essential element: when considering whether intelligence services have applied the test correctly, the judicial commissioner will apply the same principles that a court would apply on application for judicial review. We therefore have an internal legal process overseeing this before it would even get to any legal challenge. That is why it is more robust than some voices have gently suggested, and covers many of those internal challenges.
Dan Jarvis
I beg to ask leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Stuart C. McDonald
I beg to move amendment 22, in clause 2, page 4, leave out lines 27 to 30.
This amendment is consequential on Amendment 23.
The Chair
With this it will be convenient to discuss the following:
Amendment 23, in clause 2, page 5, leave out lines 1 to 14.
This amendment would remove proposed new section 226BA, thereby removing the ability to grant “category authorisations”.
Amendment 24, in clause 2, page 5, line 17, leave out “or a category authorisation”.
This amendment is consequential on Amendment 23.
Amendment 25, in clause 2, page 5, leave out lines 23 to 25.
This amendment is consequential on Amendment 23.
Amendment 26, in clause 2, page 5, line 34, leave out “or a category authorisation”.
This amendment is consequential on Amendment 23.
Amendment 27, in clause 2, page 5, line 39, leave out “or a category authorisation”.
This amendment is consequential on Amendment 23.
Amendment 28, in clause 2, page 7, line 3, leave out “or a category authorisation”.
This amendment is consequential on Amendment 23.
Amendment 29, in clause 2, page 7, line 27, leave out “or a category authorisation”.
This amendment is consequential on Amendment 23.
Amendment 30, in clause 2, page 8, leave out lines 6 to 15.
This amendment is consequential on Amendment 23.
Amendment 31, in clause 2, page 8, leave out lines 19 to 23.
This amendment is consequential on Amendment 23.
Amendment 32, in clause 2, page 8, line 37, leave out “or a category authorisation”.
This amendment is consequential on Amendment 23.
Amendment 33, in clause 2, page 8, line 41, leave out from “authorisation” to “they” on page 9, line 1.
This amendment is consequential on Amendment 23.
Amendment 34, in clause 2, page 9, leave out lines 14 to 16.
This amendment is consequential on Amendment 23.
Amendment 35, in clause 2, page 9, leave out from the beginning of line 38 to the end of line 13 on page 10.
This amendment is consequential on Amendment 23.
Amendment 36, in clause 2, page 11, leave out lines 17 to 29.
This amendment is consequential on Amendment 23.
Amendment 37, in clause 2, page 11, leave out lines 32 and 33.
This amendment is consequential on Amendment 23.
Stuart C. McDonald
First, unless I was distracted, I do not think I got a specific answer on the types of data mentioned in the amendment—for example a Facebook post, CCTV footage or anything else.
Tom Tugendhat
Those are covered under sensitive data areas; they would not be covered under bulk personal data. The hon. Gentleman also mentioned health data, and he is absolutely right that I did not answer that. I should be absolutely clear: it is hard to envision a case in which health data would be considered “low or no”, unless it was of very ancient historical standing, or there were other exceptional reasons.
Stuart C. McDonald
I am grateful for that. Could the Minister perhaps follow up on that in writing? That is useful to have on the record.
This discussion is mainly about amendment 23; the other amendments are all consequential. Basically, the amendments would remove the concept of category authorisations from the Bill. Again, I take the same approach as the shadow Minister; I will not be pushing any of these amendments to a vote, but they are designed to probe and allow for debate on some of the important concepts in the Bill.
It is this clause, and the notion of category authorisations, that leads to the restricted judicial oversight of the “low or no” categories that are being retained. It would be useful for the Minister to give us an example here of what a category authorisation might look like. I am not on the ISC, so it is hard for me to understand exactly how broadly they might be drafted. I absolutely appreciate that there are operational reasons why the Government might have to be careful about the examples they give. However, to provide some reassurance, I am sure it would be possible to put on record what one of these authorisations might look like, just so we know how broadly they will be drafted, or indeed how focused they will be.
The Minister spoke a little about oversight at the end of his previous contribution, but it is the oversight of category authorisations that causes me some concern. The tests for a category authorisation set out in proposed new section 226BA of the Investigatory Powers Act 2016 are simply that it must be classed as “low or no” and that the decision has been approved by a judicial commissioner. There are none of the other tests that are set out for the individual authorisation, such as it being necessary for the
“exercise of any function of the intelligence service,”
that it
“is proportionate to what is sought to be achieved,”
or that there are various arrangements in place.
It seems to me that the degree of oversight at the stage of granting a category authorisation is far more restricted. That has a knock-on consequence: when the judicial commissioner comes to review the granting of a category authorisation, they are only then considering whether it applies to a “low or no” group of datasets. The judicial commissioner, even on the low-level judicial review criteria, does not look at whether the category authorisation will be necessary or proportionate, or any of the other tests for the other authorisation.
Sir John Hayes
I do not want to do the Minister’s job for him, because I am sure he will say this anyway, but when an application is made by an agency for the acquisition and retention of bulk personal datasets, a specific case needs to be made in the warrant application, and a particular case has to be made where that application applies to exceptional material. That case is considered through the double-lock mechanism by both the judicial commissioner and the Minister. That case needs to specify the reason that it is necessary for operational purposes.
Stuart C. McDonald
It is useful to have that explanation. I understand that is the existing process, as the 2016 Act applies just now. However, my simple question concerns the fact that that does not seem to be what is set out here.
Tom Tugendhat
I will just answer that directly, as the hon. Gentleman seems to be running away with this issue slightly. The test set out in proposed new section 226A still applies to all datasets. It is not removed; it goes through the whole thing.
Stuart C. McDonald
That is useful to know. I will pray in aid the fact that we did not have any witnesses; anything I say that is daft, and anywhere that I do not understand how the Bill operates, I will blame on the lack of witnesses.
That is useful to know. I will go away and look at that and make sure that that all makes sense to me. That just leaves me with my earlier request: can we have some examples of what a category authorisation looks like? I can imagine that they could be incredibly broadly drafted, but they could also be very narrow. It would be useful to get a better understanding of how they will operate.
My final point is that the Government’s case appears to centre quite largely on using the material for machine learning. We have heard about language, online encyclopaedias and whatever else. If nothing else, why not use this streamlined process on that category of information and keep the existing processes in place for everything else?
Tom Tugendhat
I welcome the spirit in which the hon. Gentleman approaches this issue. He is asking important questions, and I do not challenge at all the validity of the way he has approached the issue; in fact, I should put on record that I am grateful for the way the whole House, and this Committee in particular, have approached it. It is important that any questions that any Member has, particularly the questions honourably and reasonably raised by the hon. Gentleman, are addressed.
The hon. Gentleman’s question on category authorisation is important, because the individual authorisation authorises the retention or retention and examination of a bulk personal dataset, to which part 7A applies. In other words, for every individual dataset there will be an individual authorisation. The normal rule is that each individual authorisation must be approved in advance by a traditional commissioner, as my right hon. Friend the Member for South Holland and The Deepings quite rightly addressed.
A category authorisation does not itself authorise the retention or retention and examination of a dataset; rather, the category itself is the means by which the normal rule of prior judicial approval may be disapplied in respect of the individual authorisation of datasets that fall within the description approved by the category authorisation. As the hon. Member for Cumbernauld, Kilsyth and Kirkintilloch East knows, that allows for the internal authorisation of an individual dataset that falls within an existing category. By definition, those categories are narrow enough to be identifiable but large enough to be useful. The reality is that that must be done on a case-by-case basis, but under the watchful eye of not just the unit within the intelligence service that requests it, but a senior officer in that service and a judicial commissioner.
That oversight means that we have an effective way of ensuring that we are able to use bulk personal data as categorised in different areas in a speedy fashion to enable the detection and prevention of harm, but with the oversight regime that the hon. Gentleman quite rightly expects of any apparatus of the state. The intelligence services in particular, for reasons of operational necessity, operate in the shadows, and therefore require an extra guarantee of reliance.
Stuart C. McDonald
I will go away and consider what the Minister said. Our basic issue here is that a process is in place whereby every single individual dataset must be approved and have the approval and authorisation of a judicial commissioner. Under this scheme, if there is a category authorisation and then an individual authorisation under it, there will not necessarily be any involvement from a judicial commissioner. That is the bit that we have an issue with.
Tom Tugendhat
May I come back straightaway on that? To be clear, category authorisations are reviewed by IPCO at the very latest a year—12 months—after the authorisation, but they could actually be reviewed at any point. I am afraid the idea that a category authorisation stands forever just because it has been allowed is not accurate—I know that is not what the hon. Gentleman is suggesting. The judicial commissioner would have oversight of the wider category authorisation, and the IPCO review means that the whole thing is checked at the very latest every 12 months, and probably more frequently than that.
Stuart C. McDonald
Again, I get all that, and I do not think that we are really at cross-purposes. However, we are talking about 12 months of access to datasets without necessarily having them before a judicial commissioner.
I do not think that anyone disputes that this is a slightly weaker form of oversight, which is because the services want to access this material at scale and regard the existing oversight mechanisms as cumbersome, slow and whatever else. We still ask the question of whether there is another way to do that that would still involve judicial commissioners but happen much more randomly and at scale. However, we will go away and consider that. I repeat my request—I know it is not easy—for some examples to reassure members of the public on how exactly this will work. That would be useful. In the meantime, I do not intend to push the amendment to a vote. I beg to ask leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Dan Jarvis
I beg to move amendment 15, in clause 2, page 5, line 14, at end insert—
“(4) The head of an intelligence service, or a person acting on their behalf, must notify the Investigatory Powers Commissioner as soon as is reasonably practical after a decision has been taken to include a bulk personal dataset within a category authorisation in effect under this section.”
This amendment would require that the Investigatory Powers Commissioner is notified when a new bulk personal dataset is added by an intelligence agency to an existing category authorisation.
The Chair
With this it will be convenient to discuss amendment 38, in clause 2, page 11, line 21, at end insert—
“(1A) The report provided under subsection (1) must include an annex listing the bulk datasets retained or retained and examined under each category authorisation granted during the relevant period.”
This amendment would require information about the scale and nature of use of category authorisations to be provided to the Intelligence and Security Committee.
Dan Jarvis
The issue of closing the gap between adding a bulk personal dataset to an existing category authorisation was raised on Second Reading by my right hon. Friend the Member for North Durham, who has a long-standing interest in these matters. I agree with the argument he made on Second Reading and the simple solution he proposed to close the gap: a one-line email to the Investigatory Powers Commissioner as soon as reasonably practical.
Any such email would not be seeking real-time approval and would not necessarily be reviewed by the Investigatory Powers Commissioner in isolation, but rather as part of a wider trend of what is being added to existing category authorisations. Labour does not seek to create additional work for the men and women who serve in our police and security services. On the contrary, a simple arrangement —to send a single-line email—would enhance wider oversight arrangements, while keeping extra requirements for the police and security services to an absolute minimum. In response to my right hon. Friend on the matter on Second Reading, the Minister said the IPA 2016
“allows the collection… with prior authorisation”
and that
“This is intended to speed the process up.”—[Official Report, 19 February 2024; Vol. 745, c. 556.]
We do not intend to slow the process down through the amendment, as any such notification would be made after it had happened. I therefore ask the Minister whether the problem is the act of notifying the Investigatory Powers Commissioner as soon as reasonably practical, or the potential volume of notifications, that mean he deems it an unworkable arrangement. I would appreciate if he could be as open as possible in answering those questions. If the Government do not accept the amendment, perhaps a conversation could take place between my right hon. Friend the Member for North Durham, the Minister and myself to agree a practicable solution.
Mr Jones
As my hon. Friend the Member for Barnsley Central said, I raised the matter on Second Reading. In no way do I or other members of the ISC want to slow down the process or give more work to the hard-working men and women of our security services. However, as I understand it, the only reason put forward by the Government was that it would impair operational agility.
The amendment proposes, and what I proposed, is not for the security services to go through an authorisation, as my hon. Friend just said; it is literally an email saying, “This is what we are doing.” Members might ask why that is important. It is important because we are giving the security services new powers in the Bill and for IPCO to be informed in real time. I accept the retrospective look at them, but at least if there was a trend, we could see it.
The Government have also tried to argue that there is no need for more oversight because it is a low or no dataset, much lower than those governed by the existing section 7 of the IPA. We have just had the argument about the definition of “low” and “no”, but it means that we are giving the security services additional powers here. I am not for one minute suggesting that the internal protocols within those security services will lead to things that are just a free-for-all, as some might suggest, but it gives that assurance that there is oversight of what is happening in real time.
If we were asking for authorisation of each one, I would accept that it would be too burdensome and would slow down the process, but this is literally a one-line email so the IPCO knows what is needed. I do not understand why the Government are resisting that, except that—let us be honest, Minister—we have form on this. With the National Security Bill, there was an idea that it would be a weakness on the Government’s part to accept any amendments from the ISC. However, there was one slight change made with Lord West’s amendment, so there is possibly a change of attitude. I accept that the Minister respects the ISC—I am not sure it is the same for many people higher up in Government. But that should not be a reason not to accept this very simple amendment, which I think would give people reassurance that there is some real-time oversight of this. If an election was called in the next few weeks, this Bill—
Sir John Hayes
I endorse what the right hon. Gentleman said. It is a straightforward matter. The Government could give way on this—because they already have the power to ask for it under existing arrangements—by making it a routine, light-touch process. I take the point that we do not want to impair the alacrity that is necessary for the agency. However, I think a simple change would satisfy the right hon. Gentleman, me, and many others.
Mr Jones
I agree entirely with the right hon. Gentleman. If the amendment goes into the wash-up of the Bill, things like that will have to be included anyway. I do not understand why the Government are dying in a ditch on quite a small amendment that would make no practical difference at all to the operation of this Bill. There are certain people—not including the Minister, who is quite a reasonable individual—who want to make sure that the ISC cannot claim credit for doing anything, which I think is quite sad. If the Minister cannot agree to the amendment as drafted, I echo the suggestion of my hon. Friend the Member for Barnsley Central that we draft an amendment that the Government are happy with on Report that fulfils our ambitions on oversight, but that is also practically and technically correct. [Interruption.]
The Chair
I remind members of the public to please turn their electronic devices to silent as well.
Stuart C. McDonald
I will be very brief, because I fully support what the shadow Minister and the right hon. Member for North Durham have said. If we are going to go down the route of somewhat watering down the oversight of certain bulk personal datasets, we need greater transparency and accountability. Our amendment 38 has very similar motivations. It requires complete transparency with the ISC by listing all the bulk personal datasets that would be retained under a category authorisation in the report the Bill requires to be sent to the ISC. It answers the question of how we are supposed to know how these new powers will be and are being used unless we have one of these methods of transparency.
Tom Tugendhat
If I may, I will come to the last point first. The information going to the ISC on this basis would be, as far as possible, the same as that going to the Secretary of State. Obviously, the operational data may not be included, depending on the relevant operational case. I hope that will reassure this Committee and, indeed, the ISC that the intention is to make sure that the ISC is as fully informed as possible.
On the point made by the right hon. Member for North Durham, he will know that the Bill, in many ways, has been a joint project between the Government and the ISC. I have spent many hours with members of the ISC, including the Chair, my right hon. Friend the Member for New Forest East (Sir Julian Lewis), and with various members of the Committee. Their input has been exceptionally important to me and has been included in many areas of drafting on this.
Turning to amendment 15, the right hon. Member for North Durham and the hon. Member for Barnsley Central, in many ways, have both been the Occam’s razor of the Bill process, not just here, but in other areas. They have been rightly keen that we should not include powers or requirements that would otherwise constrain or block processes or confuse the law. I understand the argument that hon. Members are making about a one-line email, but the reason that I am not convinced—though I am very happy to have the conversation suggested—is that the reality is that it is possible for IPCO to investigate at any point, and it must investigate at 12 months. Therefore, if we ask for a legal requirement on the services, that would force an extra legal duty into the various elements and it will be an extra change.
Mr Jones
I disagree with the Minister. Yes, IPCO can look back and can go in at any time to look at things, but if it does not know where the needle in the haystack is, how is it going to actually find it in the first place? This is not an onerous proposal, and I do not understand why the Minister is resisting it, to be honest. This measure would just send another reassurance to the public that, again, the extra powers being given to the security services, which I fully support, at least have some oversight. We need to address the Bill in detail and in such a way that we cannot be accused of handing over powers without also providing very light-touch reassurance that there is outside oversight. I accept that, in most cases, IPCO would not actually look at any of these.
Tom Tugendhat
In the spirit with which the right hon. Gentleman has approached this, may I commit to meeting him and the hon. Member for Barnsley Central to discuss this?
Tom Tugendhat
Well, the right hon. Gentleman could make a virtue of a necessity if he wishes. I certainly will. I shall enjoy meeting him to discuss this, and I hope that he will take that commitment in the spirit with which it is made.
Dan Jarvis
I think that this has been a useful debate. There have been a number of sensible and constructive contributions from both sides of the Committee. The Minister has made a commitment to sit down and discuss this further, and I am grateful for that undertaking. As I have said, we do not intend to push this amendment to a vote.
Peter Dowd
This is as good a time as any to raise this point. If we are going to give the powers to the security services, which nobody objects to with the appropriate oversight, and ask them to do more assessments, more dataset investigations and so on, does my hon. Friend agree that the Minister should give us assurances on resources? Given that we are asking the services to take on additional tasks in one fashion or another, does he agree that we have to set aside the resources? Perhaps, during his meeting with the Minister, he could tease that out a little bit more, because I do not want these powers and responsibilities to be given to the services without them having the appropriate resources— financial and staffing—to do their job.
Dan Jarvis
I am grateful to my hon. Friend the Member for Bootle. I am happy to give way to the Minister if he wants to respond directly to that point.
Tom Tugendhat
The point about these powers is indeed to make better use of resources. One challenge is that many intelligence officers are tied up doing things that are no longer genuinely necessary for the protection of personal privacy, but they are following processes that, were they to be working for a private organisation —a company or whatever—would no longer be necessary because bulk personal data could simply be bought. Therefore, what we are actually looking at doing is using resources much more efficiently and therefore helping the protection of the British people, from a better financial position. However, the point made by the hon. Member for Bootle on resources is always one that I welcome.
Dan Jarvis
I have nothing further to add, other than to beg to ask leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 2 ordered to stand part of the Bill.
Clause 3
Duration of bulk personal dataset warrants
Question proposed, That the clause stand part of the Bill.
Sir John Hayes
We are making sufficient progress, which perhaps permits me to say a word about why, as we have now dealt with those publicly contentious matters around bulk powers, we can move to the next part of the Bill with greater confidence. The Minister has been crystal clear that he—like me, the right hon. Member for North Durham and other members of this Committee—understands fully the important role of oversight and checks and balances. Those checks and balances are multidimensional because of the role of both those elected to this House and the judiciary. I know he will want to expand on that a little as we come to the next part of the Bill.
Tom Tugendhat
I thank my right hon. Friend. Clause 3 amends the duration of bulk personal dataset warrants under section 213 of the IPA from six to 12 months. BPDs tend to be used to support long-term strategic intelligence activities, and a longer warrant duration will enable the value of the BPD to be better demonstrated, which will provide the relevant Secretary of State with a more accurate picture of the necessity and proportionality when an application for renewal is made. The existing part 7 safeguards will remain in place, including the double lock by the judicial commissioner.
Question put and agreed to.
Clause 3 accordingly ordered to stand part of the Bill.
Clause 4 ordered to stand part of the Bill.
Clause 5
Third party bulk personal datasets
Dan Jarvis
I beg to move amendment 16, in clause 5, page 14, line 34, at end insert—
“(4) A third party BPD warrant may not authorise the examination of a dataset consisting of the contents of the marked electoral register.”
This amendment would prevent a third-party bulk personal dataset consisting of the electoral register, which sets out whether people have voted, from being examined by the intelligence services.
Dan Jarvis
Amendment 16 relates to third-party BPDs, specifically the use of the marked electoral register, which is a copy of the electoral register usually arranged by a polling station area or ward with names crossed off to indicate who has voted. Copies are available for political parties to buy from local authorities and add to their records, which aid with canvassing and voter engagement on the basis that a person who has previously voted has a higher propensity to vote again, and for that purpose alone.
Compared with the electoral register, the marked electoral register contains a record of individuals who have exercised their democratic right at the ballot box. The Opposition understand entirely that it would be appropriate for copies of the marked electoral register to be examined in an investigation into electoral fraud. Any attempts to undermine our democratic process must be dealt with with the utmost seriousness. However, we do not believe that it is appropriate or proportionate for information relating to voting records, contained in such documents, to be authorised as a third-party BPD. That could establish links between individuals or better understand a subject of interest’s behaviour.
More widely, we have concerns about records of democratic activity, such as any relating to trade union membership, being examined as a third-party BPD. Does the Minister agree that copies of the marked electoral register should be used to defend and strengthen our democratic processes, and for those purposes alone, and that safeguards should be in place to protect other data relating to democratic activity from being examined as a third-party BPD?
Stuart C. McDonald
I fully understand the questions that have been proposed by the shadow Minister, and it will be interesting to hear the answers that he gets.
On clause 5, it makes sense to ensure that access to third-party bulk personal datasets is subject to the general Investigative Powers Act scheme and oversight regime, including the double lock. Of course, we had extensive debates back in 2016 on whether that double lock was strong enough. My party argued that the judicial review standard was not tough enough and that we should be asking judicial commissioners to look at the positions again on their merits. But we lost that battle, and we are where we are.
Some of these datasets will include hugely personal information on internet searches and shopping history. These profiles can build up a pretty intrusive picture of how we go about our lives, and sometimes not very accurately. We are also talking expressly about personal datasets, which could include health data. That is on the face of the Bill. Does the Minister envisage that such access will be used only to make inquiries on subjects of particular interest, or will it be used for broader trawls of information?
As set out in the letter from the Chair of the Joint Committee on Human Rights, there is also concern about how this provision will apply to datasets that have been obtained unlawfully. Should there be additional safeguards on the use of illegally obtained data? What is the Government’s thinking on that?
Tom Tugendhat
I thank hon. Members for their points. The examination of third-party bulk personal datasets by the intelligence services is vital to their role of protecting the national security and economic wellbeing of the United Kingdom and preventing and detecting serious crime.
Clause 5 places an explicit statutory regime around the intelligence services’ examination, in situ, of bulk datasets held by third parties. The regime would apply only to the intelligence services, in line with the wider part 7 BPD powers in the IPA. The clause puts in place robust oversight and safeguards. For example, third-part dataset warrants are to be subject to a double lock, and the decision to authorise the warrant will need to be approved by both the Secretary of State and an independent judicial commissioner. The Investigatory Powers Commissioner and his office will oversee the regime to ensure the intelligence services’ examination of third-party datasets is both necessary and proportionate. That relates to the point made by the hon. Member for Cumbernauld, Kilsyth and Kirkintilloch East about proportionality and need.
To answer the point made by the hon. Member for Barnsley Central, we do not consider it appropriate to exclude specific types of dataset from those for which a third-party dataset warrant can be sought. The reason is, as he knows, that we can begin to go down very tricky routes on this area, as the intelligence services have a requirement to keep safe not just our democracy but our wider nation. Therefore, limiting those different arguments can be problematic. What we are aiming to do is ensure the proportionality requirement is the test applied by both judicial commissioners and the Investigatory Powers Commissioner.
The Secretary of State may issue a warrant authorising the examination of a third-party dataset only where it is necessary and proportionate—that is going to be quite a high bar in some of the areas asked about—for the intelligence service to examine the dataset to which the warrant relates. That decision will be double-locked by an independent judicial commissioner who, among other things, is required expressly to review the Secretary of State’s conclusions in respect of necessity and proportionality when deciding whether to approve the decision to issue a warrant. That is already in the Bill. Each decision will be made on a case-by-case basis and will be subject to prior judicial approval.
Dan Jarvis
I am grateful for the Minister’s response. I have to say, I am struggling to think of a scenario in which it might be necessary and proportionate to examine the marked electoral register. This is something we will reflect on.
Sir John Hayes
I broadly support the Minister’s view of this, but the easiest way to establish the case for this is to be clear about its operational purposes. Clearly, one would not expect the Minister or the agencies to speak about the specifics of operations, but dealing with the operational purposes would help the shadow Minister and the Committee. I am sure the Minister would be happy to do that in broad terms, either now or in writing. It would be really helpful to go through the kinds of operational purposes associated with this inquiry. I do not know what the Minister and the shadow Minister think, but that is how I see it.
Dan Jarvis
That is a helpful and useful suggestion. I am happy to proceed on that basis, if the Minister is.
Dan Jarvis
On that basis, I beg to ask leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 5 ordered to stand part of the Bill.
Clause 6
Minor and consequential amendments
Question proposed, That the clause stand part of the Bill.
Tom Tugendhat
Clause 6 makes minor amendments to the 2016 Act to reflect the introduction of parts 7A and 7B, including making it clear that the Investigatory Powers Commissioner is responsible for oversight of the part 7B regime.
Question put and agreed to.
Clause 6 accordingly ordered to stand part of the Bill.
Ordered, That further consideration be now adjourned. —(Scott Mann.)
Investigatory Powers (Amendment) Bill [ Lords ] (Second sitting)
Thursday 7th March 2024
(2 months ago)
Public Bill CommitteesRead Full debate Investigatory Powers (Amendment) Act 2024 View all Investigatory Powers (Amendment) Act 2024 Debates Read Hansard Text Read Debate Ministerial Extracts Amendment Paper: Public Bill Committee Amendments as at 7 March 2024 - (7 Mar 2024)
The Minister for Security (Tom Tugendhat)
The Investigatory Powers Act 2016 contains world-leading oversight arrangements, which have strengthened the safeguards that apply to the use of investigatory powers. The clauses will enhance this oversight regime, including the role of the Investigatory Powers Commissioner, to ensure it is resilient and that the IPC can continue to effectively carry out their functions. This includes creating a statutory basis for appointing deputy IPCs to whom certain functions can be delegated and, in exceptional circumstances, the appointment of temporary judicial commissioners. The clauses also place certain existing oversight functions on a statutory footing and provide clarity to public authorities in their error reporting obligations. These are important and targeted amendments to ensure the oversight regime remains robust and the IPC can continue to carry out their role effectively.
Question put and agreed to.
Clause 7 accordingly ordered to stand part of the Bill.
Clauses 8 to 10 ordered to stand part of the Bill.
Clause 11
Personal data breaches
Tom Tugendhat
I beg to move amendment 1, in clause 11, page 31, line 36, leave out “a court or tribunal” and insert “the Investigatory Powers Tribunal”.
This amendment is consequential on amendment 2.
The Chair
With this it will be convenient to discuss the following:
Government amendment 2.
Clause stand part.
Tom Tugendhat
Clause 11 will ensure that there is clarity for telecommunications operators operating within the IPA framework about which regulatory body certain personal data breaches should be notified to. It also provides a statutory basis for the Investigatory Powers Commissioner being notified of such breaches. Without this change, there will be confusion about personal data reporting obligations and a regulatory gap in respect of certain personal data breaches by telecommunications operators not being dealt with by the appropriate regulatory body. The clause also ensures that an individual affected by a personal data breach can be notified of the breach by the Investigatory Powers Commissioner, if the IPC deems to it to be in the public interest to do so. This will enable them to seek remedy from the Investigatory Powers Tribunal.
Government amendments 1 and 2 build upon the provisions already contained in clause 11 by providing a clear route to redress for those affected by personal data breaches committed by telecommunications operators. They ensure that the Investigatory Powers Tribunal has the jurisdiction to consider and determine complaints about personal data breaches committed by TOs and grant a remedy. The IPT already has significant experience of considering complaints from individuals who believe they have been the victim of unlawful interference by public authorities. It is therefore the appropriate forum to consider complaints regarding certain personal data breaches.
Amendment 1 agreed to.
Amendment made: 2, in clause 11, page 32, line 19, at end insert—
‘(1A) In section 65 of the Regulation of Investigatory Powers Act 2000 (the Tribunal)—
(a) in subsection (2), after paragraph (b) insert—
“(ba) to consider and determine any complaints made to them which, in accordance with subsection (4AA), are complaints for which the Tribunal is the appropriate forum;”
(b) after subsection (4) insert—
“(4AA) The Tribunal is the appropriate forum for a complaint if it is a complaint by an individual about a relevant personal data breach.
(4AB) In subsection (4AA) “relevant personal data breach” means a personal data breach that the individual is informed of under section 235A(5) of the Investigatory Powers Act 2016 (serious personal data breaches).”
(1B) In section 67 of the Regulation of Investigatory Powers Act 2000 (exercise of the Tribunal’s jurisdiction)—
(a) in subsection (1)(b), after “65(2)(b)” insert “, (ba)”;
(b) in subsection (5)—
(i) the words from “section” to the end become paragraph (a), and
(ii) after that paragraph insert “, or
(b) section 65(2)(ba) if it is made more than one year after the personal data breach to which it relates.”
(c) in subsection (6), for “reference” substitute “complaint or reference has been”.
(1C) In section 68 of the Regulation of Investigatory Powers Act 2000 (Tribunal procedure), for subsection (8) substitute—
“(8) In this section “relevant Commissioner” means—
(a) the Investigatory Powers Commissioner or any other Judicial Commissioner,
(b) the Investigatory Powers Commissioner for Northern Ireland, or
(c) the Information Commissioner.”’—(Tom Tugendhat.)
This amendment provides for the Investigatory Powers Tribunal to be the appropriate forum for complaints by individuals about certain personal data breaches reported to the Investigatory Powers Commissioner under section 235A of the Investigatory Powers Act 2016 (personal data breaches).
Clause 11, as amended, ordered to stand part of the Bill.
Clause 12
Offence of unlawfully obtaining communications data
Stuart C. McDonald (Cumbernauld, Kilsyth and Kirkintilloch East) (SNP)
I beg to move amendment 39, clause 12, page 33, leave out lines 16 and 17.
This amendment would remove one of the examples cases where a relevant person has lawful authority to obtain communications data from a telecommunications operator or postal operator, being where the data has been “published”.
The Chair
With this it will be convenient to discuss the following:
Clause stand part.
Clauses 13 and 14 stand part.
The schedule.
Stuart C. McDonald
The clause relates to section 11 of the Investigatory Powers Act 2016, which created an offence where a relevant public authority knowingly or recklessly obtained communications data from a telecoms or postal operator without lawful authority. That is an extra protection against unlawful invasions of privacy by public authorities. Comms data can of course be vital to prevent serious crime or to assist in missing persons investigations, but it can also be seriously invasive if not monitored, as such data can reveal all sorts of details about our lives and the people that we are linked with. The clause makes changes to that offence.
It is said that there is a lack of clarity around the concept of lawful authority, so the clause includes some examples of what lawful authority is. Most are uncontroversial—for example, where there is a statutory basis for gathering the data, where there is a relevant court order or an authorisation, or where it is obtained to respond to a call to the emergency services. However, we contest the assertion that new subsection (3A)(e) is a proper example of lawful authority, referring to:
“where the communications data had been published before the relevant person obtained it”.
We are concerned that that is not a correct expression of the law as it stands.
The simple fact of data being published is not in and of itself lawful authority for it to be obtained and subject to surveillance. The fact that I publish a Facebook post at such and such a time in such and such a place does not give public authorities the right to seek it from Facebook. In fact, on a Zoom meeting about a controversial political campaign, it cannot be the case that Zoom can then be ordered by the police to obtain the relevant communications data simply because the data was published and available to those who attended the meeting.
We need a very careful explanation from the Minister about what precisely is intended by the example in paragraph (e) because as drafted—again, it depends on how we interpret these things—it seems to be open to an interpretation that anything even semi-publicly available can be obtained by public authorities without anything more.
Tom Tugendhat
I will speak more widely to clause 12 before addressing the amendment. The clause does not create new routes to obtain communications data outside the Investigatory Powers Act. Rather, it provides examples of existing routes to acquire communications data in order to put the existing position, as set out in the communications data code of practice, on to a statutory footing. This will provide clarity that acquiring communications data in this way will amount to lawful authority for the purposes of the offence in section 11 of the IPA. It makes it clear that sharing of communications data between public bodies is lawful. It is not the intention of section 11 to discourage public sector sharing of data when administering public services for purposes such as fraud prevention. Clause 12 puts that beyond doubt.
While discussing clause 12, I will take the opportunity to set out that a communications data authorisation can amount to lawful authority to require a telecommunications operator to carry out any necessary activity on their systems to enable or facilitate the obtaining of the relevant communications data. The list of examples of what will amount to lawful authority in clause 12 will provide additional clarity to the existing drafting of section 60A(5) in the Investigatory Powers Act, which sets out what can be authorised under part 3 for the purposes of acquiring communications data.
I would also like to address an inconsistency with paragraph 176 of the explanatory notes for the 2016 Act and the conduct that the Act permits. To be clear, a communications data authorisation may authorise interference with equipment by a person where that is done to enable or facilitate the acquisition of communications data for the purposes of identifying an entity as well as information about their previous or current location.
The Government do not support amendment 39, moved by the hon. Member for Cumbernauld, Kilsyth and Kirkintilloch East. Additional authority for published material should not be required for its disclosure by a telecommunications operator to a public authority when that data has been disclosed with the consent of that operator. The consent of the operator provides the lawful authority for the obtaining of the previously published communications data, which public authorities can rely on. It places the existing position, set out in paragraph 15.11 of the communications data code of practice, on a primary legislative footing. It does not create new acquisition routes.
Clause 13 amends the definition of communications data to include subscriber and account data, ensuring that this communications data is available to investigators with an IPA part 3, even if it is transmitted as the content of the message. That is not a broadening of the definition but a clarification of scope. “Subscriber data”, or “account data”, includes the details provided when someone completes an online registration form for a telecommunications service or system. This change overcomes the current uncertainty for investigators about the data types that will be “communications data” and therefore available to them.
Clause 14 restores the general information gathering powers to regulatory or supervisory bodies, which were repealed by section 12 of the 2016 Act. It will ensure that public authorities will be able to utilise their own pre-existing statutory powers to acquire communications data for civil purposes. These are existing statutory powers that have been conferred on public authorities by Parliament—for example, in the regulation of the financial markets to ensure market stability.
Since 2016, the data sought has increasingly moved online and is now being caught by the definition of “communications data” in the 2016 Act. For example, His Majesty’s Treasury is responsible for the civil enforcement of financial sanctions regulations. Some information that is essential in carrying out its civil enforcement functions, such as the timestamp of an online banking transaction, is now communications data, and His Majesty’s Treasury cannot currently use its powers to compel that information to be provided by a telecommunications operator. Communications data is available under the IPA only if the matter under investigation is a serious crime, and so is out of reach for public authorities exercising civil enforcement functions.
Stuart C. McDonald
I thank the Minister for his response and his explanation. We will of course take that away and give it consideration again. He has referred to codes of practice being put into statute, so we will go away and look at those codes of practice. Of course, codes of practice can sometimes be inconsistent with various laws as well, so this is not necessarily the end of the matter. It would be helpful if the Minister could perhaps—in writing, or perhaps we will have to revisit it on Report—look at the specific examples that I gave and just explain whether or not those amount to prior publications of comms data.
Stuart C. McDonald
I very much appreciate that, and that will hopefully help to clear things up before we get to the next stage of proceedings. I will withdraw the amendment.
Sir John Hayes (South Holland and The Deepings) (Con)
Before you move to the vote, Mrs Cummins—forgive me for not rising with greater speed—I just wanted to test the Minister on clause 14 in particular. Clause 14 deals with the other public authorities that will enjoy the powers that the Bill affords. That was debated at length when the 2016 Act, which this Bill amends, was considered, and the Minister will recall that I also raised it on Second Reading.
It is of course true that a number of public bodies have lawful powers to intervene in a regulatory function where a malicious activity could have dire consequences. The Minister will have many examples to hand, but I will take just one for the purpose of illustrating my argument. The Environment Agency could intervene in the case of a watercourse that had been poisoned intentionally; that would be a criminal act resulting in an investigation and prosecution. One can imagine a circumstance where it would be necessary for that body to obtain communications data to discover how that occurred.
To be clear—the Minister will no doubt tell us—this is not the “what” being communicated, but the who, the when and the where. That is what we mean when we speak of the powers in the 2016 Act and this new Bill. We are not talking about the “what”; we know the telecommunications operator will be obliged to make available the content of communications data. The endeavour that the agency concerned will be involved in is finding out why something has happened. The “why” will of course be closely associated with the investigation and the possible subsequent prosecution.
Tom Tugendhat
As always, my right hon. Friend asks a pertinent question. I hope he will forgive me for saying that I very much hope that the letter I asked to be sent arrived in his inbox this morning. He may not have seen it, which I completely understand, as there are many pressing issues on his time. I have also attached it into the packet for the Bill and indeed copied it to the ISC secretariat, which has done such an important job in ensuring that we are all as one on this. I hope very much that that will answer my right hon. Friend’s questions. If it does not, he knows where I am—I would be delighted to clarify it further. As my right hon. Friend has very kindly asked, I shall give that list now, for the record: HM Revenue and Customs, the Financial Conduct Authority, the Department for Work and Pensions, the Treasury, the National Crime Agency, the Department for Business and Trade, and the Competition and Markets Authority.
My right hon. Friend reminds me of that famous scene in “Yes, Prime Minister”—thank God defence is held at central authority, or we would not have to worry about the Russians; we would have a civil war in two weeks. His point about local authorities having intelligence powers is valid. They do not have the same intelligence powers as MI5—let us be absolutely clear about that. That is not what we are offering.
Sir John Hayes
It does the Minister great credit that he has made that list available during the course of our consideration. That is very important. What I had feared might happen was that we might not get it while we were in Committee. In fact, I have not actually seen it, but I am grateful to him for making it available, at least, during our consideration.
Mr Kevan Jones (North Durham) (Lab)
This is an area that concerns me. I am quite certain the security services have protocols on how to deal with such things, but it worries me that the DWP is on that list. Having been involved in work on the Horizon Post Office scandal for many years, I know the DWP did not cover itself in glory on some of those cases. Can the Minister reassure the Committee that there are protocols governing when and how it will use those powers? That, I think, would give the public some assurance that there is a standard for how they will be used.
Tom Tugendhat
The right hon. Gentleman tempts me towards an area that the Bill does not cover, so I hope he will forgive me for focusing on what it does cover, such as the safeguards. Clause 14 will limit communications data acquisition to the purpose of a body required to meet its civil functions and duties, such as a regulatory body providing oversight of financial markets, or indeed the DWP overseeing different elements of its responsibilities. Where disclosure is in support of a criminal prosecution and IPA part 3 authorisations for communications data must continue to be sought, using the existing safeguards and oversight provided for by the Investigatory Powers Commissioner’s office, the courts will oversee the use of those powers by public authorities in the same way as the acquisition of non-communications data under the existing powers. He has asked me specifically about a connected area, so—I hope he will forgive me—I will have a look at it and write to him very specifically about that.
Mr Jones
May I suggest that the Minister does write to the Committee? I accept the safeguards in place, but for organisations other than the security services, I want to know what internal mechanisms they have to ensure that use of those powers is proportionate in terms of investigations and so on, and what training and protocols they are using. If the Minister could write to us on that, that would be helpful.
Tom Tugendhat
Forgive me, but the right hon. Gentleman is asking for a very large piece of work there. I am setting out the legal authority under which those organisations can act. Their internal processes may be different in different circumstances and be answerable to different Ministers.
Mr Jones
I am sorry, but I do not agree with the Minister. He is giving those other public bodies additional powers, and I think it is quite reasonable for this Committee and the public to be assured of how those powers are actually going to be used. As I say, I have no problem with the security services, because I am well aware that they have very clear, strong protocols and safeguards governing the use of their powers internally, with authorisations and so on. I think he just needs to ask those other Departments how they are going to do this, and what the internal mechanisms are.
Tom Tugendhat
I am very happy to ask them; I am just stating clearly that they are not under the responsibility that I have as a Minister. The legal powers that they are given are not additional powers; they are repetitions of the IPA 2016, so they are not additional powers—[Interruption.] Forgive me, but they are not additional powers. Their existing codes of practice under the different organisations have their own responsibilities within them.
Mr Jones
I beg to differ. In the next clause, we will come on to the breadth and depth of the new powers, but that is a different argument—I will save that until then. However, he is the Minister and, in my experience, the Minister leads the Bill. I would have thought it would be quite simple to ask those other Departments what those protocols are. If he does not ask, he does not get.
Tom Tugendhat
I will happily ask. The right hon. Gentleman is asking for internal management structures, though.
Sir John Hayes
I am grateful to the Minister for offering me a second bite of the cherry. Perhaps I can offer a Hegelian synthesis between him and the right hon. Member for North Durham. We talked earlier about operational purposes, but we have to be careful about that: in the case of the agents of the police, one cannot publish purposes in fine detail, because that would be unhelpful. However, in broad terms, perhaps the way forward on this is to illustrate the kind of purposes that the bodies the Minister described might employ, within the legal constraints that he just set out. Perhaps that is the way forward; it would certainly satisfy me, and I cannot think that would not help to satisfy the right hon. Member for North Durham, who is a reasonable man—not my right hon. Friend, but a right hon. Gentleman and a personal friend, which is better than being a right hon. Friend.
Tom Tugendhat
As always, I welcome my right hon. Friend’s contribution. That is covered in many areas in the letter I wrote to him.
Dan Jarvis (Barnsley Central) (Lab)
In an earlier response to comments by the right hon. Member for South Holland and The Deepings, the Minister helpfully mentioned the letter that I think has been sent to the right hon. Member and possibly other members of the Committee. Can the Minister confirm that that letter will also be sent to the Opposition?
Tom Tugendhat
To be absolutely clear, the letter was in response to my right hon. Friend the Member for South Holland and The Deepings, so it was sent to him, it was copied to the secretariat of the ISC and it is in the Bill pack. The hon. Member for Barnsley Central therefore has access to it.
Mr Jones
May I ask the Minister to look at his internal process again? We also had this problem with the National Security Bill. I do not know whether he should change the pigeon post he is using to ensure people have it. May I also point out that the ISC is not constantly in session? Therefore, if he has to send it to the ISC, we do not automatically get it until our next meeting or when we do the next reading.
Tom Tugendhat
I am delighted to clarify that the letter was emailed to my right hon. Friend the Member for South Holland and The Deepings. He is a traditionalist in many ways, but I believe he has entered the electronic age.
Stuart C. McDonald
I beg to ask leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 12 ordered to stand part of the Bill.
Clauses 13 and 14 ordered to stand part of the Bill.
Schedule agreed to.
Clause 15
Internet connection records
Question proposed, That the clause stand part of the Bill.
Tom Tugendhat
The changes made by clause 15 should transform the intelligence services and the National Crime Agency’s ability to detect serious criminals and those seeking to undermine national security. Current internet connection record conditions only enable identification of individuals involved in known events. That means an investigator must know the date, time and service being used, preventing identification of offenders where they cannot be linked to a specific time of access. For example, where analysis of a seized device identifies a site serving images of child sexual exploitation, it would not currently be possible to search ICRs for subjects accessing that site beyond a specific known event. New condition D would help to identify other subjects accessing those sites. This will not be a fishing exercise. As with all investigatory powers, the case for requesting ICR data must be necessary, proportionate and intelligence-led. As Committee members will have heard this week, the benefit to the agencies is in being more, not less, specific.
The new condition will be subject to robust safeguards, including limiting the statutory purposes available, stringent necessity and proportionality requirements and independent oversight, including regular inspections by the Investigatory Powers Commissioner’s Office. Where internal authorisation takes place for urgent and national security-related applications, authorising officers must be independent of the operation and not in the line management chain of the applicant. If an investigator knowingly or recklessly obtained ICRs—for example, if the request was clearly not proportionate—they would be at risk of having committed a section 11 offence of unlawfully obtaining communications data, which can result in a fine or imprisonment.
Stuart C. McDonald
We are now looking at internet connection records. Whether we are for or against the provisions, the requirement in 2016 for companies to generate and provide internet connection records was a radical departure and makes the UK something of an outlier: as I understand it, there is no other European or Five Eyes country that allows the same sort of requirements to be made, certainly in relation to its own citizens.
As the Minister explained, there are various conditions on who can access the records. At present, the investigating bodies need to know which personal device they are looking for ICRs in relation to or know a specific time when a website was accessed to identify who was responsible for the events of interest to them. There is some judicial oversight, but not always. We are being asked to move a little further from that already fairly radical starting point and remove the need for a particular time to be identified, so as to have a general look at who uses certain internet sites and services over broader grades of time. That risks moving us step by step away from suspicion-based surveillance towards broader mass surveillance. People become targets of surveillance because of websites they have visited that are not only of questionable ethics, but potentially in breach of article 18 of the European convention on human rights. Various examples of how that might work are given in the explanatory notes, particularly in paragraph 120.
The Minister also gave some examples in relation to access to sites that are clearly illegal. I was quite surprised to learn that there are not already other powers that can be used to investigate who is engaging with such sites. If that is not the case, why not confine the power to sites that are clearly illegal in and of themselves, rather than enabling a trawling of data in relation to other sites that are not? I am not a tech geek, as will become more and more apparent the more that we debate the Bill, but the explanatory notes themselves confirm that there is a danger of and huge susceptibility to error here. Paragraph 123 says:
“Whilst clearly having the potential to provide significant operational utility it is recognised that such queries are highly susceptible to imprecise construction. As a result, additional safeguards are proposed in this Bill with the intention of managing access to this new Condition and mitigating public concerns.”
I am not absolutely convinced by the additional safeguards that follow in paragraph 124, which seem to revolve around training and various other requirements.
At the very least, I would prefer to see us go for independent judicial oversight in all cases, including authorisations under condition D2. As I understand it, under condition D1 a judicial commissioner would need to authorise what has been sought, but under condition D2 it could be internal. If the Minister wants us to expand the powers without the need for judicial authorisation in all cases, he needs to explain how often he expects the powers to be used and why judicial commissioner involvement in all such cases would not be realistic. Are there not other ways in which we can make this work while still retaining judicial oversight in all cases under the new provisions? I understand what the goals are here, but this is an example where it could be framed more narrowly and oversight could be strengthened.
Mr Jones
I agree with the hon. Member for Cumbernauld, Kilsyth and Kirkintilloch East, and the ISC feels strongly on this issue. We are clearly speaking English and the Minister is speaking Japanese, because this is about understanding what is actually being given to the agencies without any judicial oversight, which is being dismissed as if these powers are no greater or more intrusive.
As the Committee will know, under the IPA an internet connection record is a form of communications data. It contains data on who has accessed something: it does not actually provide the content of what they have seen or been in contact with. However, under the IPA information can be sought to develop knowledge of who is speaking to who. I think the ISC see the value of this for not only security services but issues around child protection and organised crime, as has already been argued. We are giving the security services and agencies a degree of authorisation here, which I would argue they have not had up until now.
We then come to the argument made by the Minister and the Government that these regulations are not any more intrusive than what we have at the moment. I would argue differently because the power is broad. Previously, targeted discovery condition A, under section 62 of the IPA, required that the agency and officer know the service and precise time of use to discover the identity of an individual, so that they actually know what they are targeting. The Minister used the words “fishing expedition”—this regulation will be a fishing expedition. By default, it will bring in a broader range of individuals who have nothing to do with the target the agencies are looking at the time and connection records for, and are of no interest to the agencies or anybody else.
The Government are arguing that this regulation is no more intrusive—but it is, if we are dragging in a large number of people in that way. Actually, by not having any judicial oversight, they are allowing the agencies to agree that internally. Although the intrusion is not deeper, it is certainly a lot broader than what we have at the moment. The Bill says that the new powers can only be used for “national security” and the catch-all phrase
“economic well-being of the United Kingdom”.
I am still yet to be convinced of that terminology, but I understand that the Minister and the civil service like consistency across Bills, and that is why it is in this Bill.
Under sections 60A and 61 of the IPA, requests to obtain an ICR are like requests to obtain other communication data: they have to be “necessary and proportionate”, which runs through all of this. Again, the Government are allowing the agencies to decide what is necessary and proportionate. I am not suggesting for one minute that they are going to go on a fishing expedition, but again there is a problem with the Government’s approach to the Bill, and certainly with the agencies’ approach. They want these powers, and I do not personally have an objection, but we have to look at how other people, who are not drowned in the detail of this Bill, will perceive them. Some opponents would say, “Why should I be dragged into this?” It is really about giving public confidence; as the right hon. Member for South Holland and The Deepings said this morning, when the IPA was passed, it was about trying to reassure people.
It would be very simple to ensure that this regulation has independent judicial oversight, as the hon. Member for Cumbernauld, Kilsyth and Kirkintilloch East has just said. I know the catch-all phrase that the Minister will come back with, because I am a quick learner: he will say, “The IPC has the ability to look back at anything.” Again, that is the haystack—where is the needle? It would be better and more reassuring if they were to have some judicial approval in advance. I will give the Committee one example. Let us suppose that we are looking at train records and patterns of behaviour on WhatsApp or a train-ticketing website. There is possibly a valid reason to do that—to see someone’s patterns of travel, and so on—but it will scoop up a lot of innocent internet users. The assurance here is that they will not be of interest and therefore they will not be part of it, but their information is being dragged into the system. Then a decision has to be made as to which ones people are interested in and which ones they are not.
That is a big change. I accept that it would not be the exact content that somebody accessed, but the connections would be there. It does not sit comfortably with me to leave such a big change to the security services. Knowing them as well as I do, I do not suspect that they will use the provision illegally or for alternative motives, but we have to reassure the public, and I do not think this does that. Would that be onerous? I am not sure that it would be. This comes back to the point that we have made about the ISC all the way through. If we are giving the security services extra powers, we need the counterbalance of a safeguard.
As the right hon. Member for South Holland and The Deepings said this morning, that was exactly how the IPA was approached. Clearly, he was a very good Minister, because he accepted amendments and suggestions, whereas only one has been accepted for this Bill so far. The Minister spoke this morning about working with the ISC. The Minister speaks to us, but he does not necessarily listen to what we say or take a great deal of interest in what we propose. This is an important point. It comes back to the fundamental point that if extra powers are going to be given, it is only right that they come with responsibilities and safeguards.
New condition D removes the existing requirement for the exact service and the precise time of use to be known. Basically, it will now be possible to do a sweep, which will mean dragging people in. Therefore, I cannot see the problem in having some oversight of these powers. I would like to know why the Minister thinks that condition D is not more intrusive. It is more intrusive, because a lot more people will be affected by it. I think the Government are hiding behind the idea that because it is not possible to identify what the individuals have actually seen, it is not really interesting. If that is the case, why have it in the first place? I know the reason for that, but it would be interesting to know what thought has gone into this and how many people will be dragged in. It obviously depends on how the provision would be used in practice. If we went down the street and said to people that we are giving these powers without any judicial oversight—the Minister will say that IPCO can always look at it, and I understand all that—I think that most people would be quite worried. We would give reassurance by providing that important oversight.
This provision certainly needs to be looked at. Is it of benefit and am I convinced that this is a new power that the agencies need? I am, and I think it is right, but coming back to the previous point, we have to ensure that we do not do anything that undermines what is done or that gives ammunition to those people who want to cast aspersions on what is actually done.
I think I know the arguments that the Minister will put forward. We will no doubt come back to this matter on Report, when there will, I think, be amendments from members of the Committee; and if we have an election wash-up, this is one proposal that I think will be pressed by the Opposition.
Sir John Hayes
To supplement what the right hon. Gentleman has said, this was part of the original legislation and it is and always has been a controversial aspect of it. There are two things that I would emphasise here. First, it is really important to understand that the kinds of inquiries that would necessitate the use of this power are exceptional. When we considered the original Bill in Committee, one of the arguments was around a criminal threshold: in what circumstances would the public bodies that we are talking about need to avail themselves of the powers? I am on the record as saying at that time that I entirely agreed with the then shadow Minister’s argument that it should not be permitted for minor crimes. In other words, the bodies that the Minister listed earlier would not be using the powers on a routine, daily basis for all kinds of things that they are lawfully entitled to do; they would take advantage of the powers in exceptional cases in which very serious matters were at hand. That would be a helpful way of assuaging some of the doubts raised by the right hon. Member for North Durham.
Mr Jones
Or we could have what was suggested earlier: when the power is used, that is reported to the Investigatory Powers Commissioner, so that it is aware of what is going on and can do something if it has concerns. At the moment, it is presented with a haystack and has to look for the needle.
Sir John Hayes
Exactly. That point was made when we debated the original Act, and I think that I committed at the time to those kinds of things being detailed in the annual report. To clarify a point that was made earlier, David Anderson was clear at the time, and has been since, that we cannot detail the operational purposes of the agencies if doing so would compromise them. The techniques and approaches that they necessarily use in the performance of their duties could be compromised if we were to talk in detailed terms about the character of their operational activities. However, we can speak in broader terms about the kinds of circumstances in which powers might be used—and all the more so for the other public bodies, in a sense, because even if a serious criminal investigation is taking place, those investigations are not typically as secret as they might necessarily be in respect of the security and intelligence community.
Perhaps those two grounds—greater sight of the processes in those bodies and clarity about the circumstances in which the powers can be used; in other words, exceptionally and for very serious matters—would be helpful ways of dealing with some of the points raised by my colleague on the ISC, the right hon. Member for North Durham.
Tom Tugendhat
As usual, right hon. and hon. Members have raised some excellent points. Let me be clear: it is not true to say that there is no judicial oversight. To say that there is no judicial oversight would be correct if the IPC were not in place. I know what the right hon. Member for North Durham is going to say, but that is a form of judicial oversight.
As to the way in which the authorisations work, I hope that I have been clear—I will repeat it to ensure that I am—that an investigating officer would have to make an application to use the powers. That would have to go to a senior officer in their service who is not in their chain of command: someone who is not overseeing the operation or in their management chain—a separate element. Any abuse of that system could mean that that individual, or those individuals, are in violation of section 11. I know that the right hon. Member for North Durham takes his responsibilities on the ISC exceptionally seriously and is fully aware that sometimes there can be a pressing need for operational action at pace. That is what this is also designed to help. It is important that officers have the ability to act under a regulatory framework that means that abuses are, at worst, extremely limited due to various constraints.
Mr Jones
I accept that and I have confidence in the internal protocols—do not get me wrong on that—but the Minister does not have to convince me or members of this Committee; it is about the public perception. What is the problem? If we are not going to have judicial oversight in terms of judicial authorisation, what is to stop us having another system whereby, when it is used, the IPC is informed? We could send a simple email so that it would at least have ongoing oversight when these powers are being used.
Tom Tugendhat
The right hon. Gentleman is creating his own haystack here. Although I hope as ever that this power will be used only exceptionally rarely, sadly the nature of serious and organised crime and terror in this country means that it will be used more often. There is a slight misunderstanding as to how this will be used. Targeting a train website or a single authority would not be proportionate or meet the necessity provisions within the Bill. It would be neither necessary nor proportionate. In fact, it would be unnecessary and would be vastly disproportionate, because it would be a mass collection exercise that would neither be targeted in a way that would satisfy the proportionality requirement, and nor would it give a useful answer—it would give such bulk data as to be useless—and therefore it would not be necessary.
The whole point of this is that it sets out a series of conditions in which these powers could be used—perhaps against a certain website, that is true—but on the basis of intelligence. It would have to have a particular cause and a particular time. This is not a Venn diagram with a single circle, but a Venn diagram with four or five circles; it must be in the centre of those for it to be necessary and proportionate.
Stuart C. McDonald
I would be reassured if there was independent advanced judicial oversight. The Minister has said a couple of times that the powers will be used “exceptionally”. What is the difficulty in making sure that there is an exception for urgent cases of advanced judicial authorisation for use of these powers?
Tom Tugendhat
“Exceptional” does not mean that there is necessarily huge amounts of time to act; exceptional means that the seriousness of the offence is extremely grave. These powers are for things such as child sexual exploitation. I wish it were not so, but even in this country, the police very often have to act extremely speedily to prevent harm to a child and sometimes, very sadly, multiple children. They have also to act extremely speedily to prevent terrorist plots or other forms of very serious organised violence or criminal activity.
That is why “exceptional” does not necessarily mean that it can be dealt with in a procedural way over a number of weeks; exceptional may mean absolutely pressing as well, and that is what this is designed for. The right hon. Member for North Durham may have been aware from briefings that I believe he has received that, in some circumstances, this Bill will reduce the time taken to interrupt serious abuse of children, from months and occasionally years down to days and weeks. That is surely an absolutely essential thing to do, but that will not work unless these powers are used according to the Act, with the important words being “proportionate” and “necessary”. The reason I repeat those words is that were the intelligence services to go on some sort of fishing expedition—and I know that the right hon. Gentleman is not suggesting that they would—that would not be legally permissible under this Act and nor would it achieve the required results, because it would turn up so much data that it would simply be an unusable, vast collection of fluff. Effectively, instead of targeting the needle, they would have merely collected another haystack.
Mr Jones
It is not about a fishing expedition, but they will get into a fishing expedition anyway. He says that train lines would not be affected, but they would. If someone wants to see an individual’s travel pattern, that is what they may do. Therefore, a lot of people’s data will be dragged in, not because it has been looked for but because it will come in anyway.
The problem is that if the argument is about speed—which I do not necessarily think is the case in some cases—the Minister has to do two things to reassure people that the powers are going to be used in the right way. First, he must provide pre-authorisation judicial oversight, and secondly, the IPC should be told, perhaps via a simple email, when the powers are used. That would at least allow it to look at the trends and uncover any concerns. I accept the protocols in place and am 100% sure that they are being followed, but it is possible that some people will not follow them and that is what we have to guard against.
Tom Tugendhat
This is a somewhat odd argument, because the right hon. Gentleman and I are slightly together but also arguing at cross purposes. Both of us have a very high regard for the intelligence services and are confident in their integrity, but we are slightly at cross purposes because he believes that we are not satisfying the oversight element, but I believe we are.
Let me be clear. I am not being a stick in the mud about this for any political reason. I actually happen to believe that this is the right way to approach this. There is a constant balance in all forms of oversight between the ability to act quickly and the ability to be controlled from outside. I believe that this sets in place a very significant, burdensome requirement on those who are taking these responsibilities to act according to certain principles. To repeat, the principles are necessity and proportionality. I do not think anybody in here would argue against those. What this requires them to do is make sure that the principles are met by effectively targeting in advance.
The right hon. Gentleman’s comment about train line use would, I am afraid, not satisfy that proportional need. The individual would have to be specifically identified in advance. The pattern of use of the website from the single point and to the point of contact—from a phone to an internet server or whatever it might happen to be—would have to be clarified. These ICRs are Venn diagram circles that are getting narrower and narrower. The idea that this would end up with some sort of week-long or month-long trawl of a train line website is, I am afraid, not permissible under the 2016 Act. Were any intelligence officers to do it—though I do not believe that they would—they would fall foul of section 11 and would not be acting necessarily and proportionately. Therefore, it would not be permissible.
It is pretty clear that existing conditions B and C already enable public authorities to make an application for a known individual’s internet connections. New condition D only enables a request for details to identify individuals who have used one or more specified internet services in a specified time.
Owen Thompson (Midlothian) (SNP)
I think that is the point. I do not think anyone is arguing against the fact that there will sometimes be exceptional circumstances that require haste. Everybody accepts that, but the issue with condition D is that it is explicit in removing the targeted nature of the other conditions. It is where they do not know the time or person and do not have the data available that they are using condition D. There is nothing in the Bill to make clear that it can only be used in exceptional circumstances. How can we square that circle? I do not think that anyone would disagree with the fact that there needs to be an ability to move at pace at times, but there is nothing here that says that power could only be used in those sorts of circumstances. Condition D creates a situation where we are going to hoover up data on a huge number of people, but there is nothing to say how long we are going to hold on to that data for, or what would be done with it.
Tom Tugendhat
To answer the last part of the question first, the holding on to data and what is to be done with it is the same as under the IPA generally. Information can be held or not held according to those provisions. This Bill does not change any of that, which is why that is not covered here, and I know the hon. Gentleman would not expect it to be.
It is worth pointing out that condition D is not only no more intrusive than conditions A, B or C, in terms of data—
Tom Tugendhat
Let me just finish the point; I know the hon. Member will come back to me.
Condition D is no more intrusive, and it does require the serious crime threshold, which does add an extra layer before it can be used. I hear the hon. Member’s point; the condition still requires proportionality and necessity, so it could not be simply anybody who is using Facebook, because clearly that is not proportionate. It still requires that targeting; it still requires those Venn diagrams, if he likes, to close over a target; and, even then, it requires the serious crime threshold.
Sir John Hayes
The key thing to understand here is that the agencies have always had the ability to intercept communications data. Communications data is one’s letters. Communications data is one’s phone calls. We speak about communications data now, mindful of the way that people communicate now, and we think of the internet and telephones, but the process of intercepting communications has been a core part of the work of the agencies since the agencies began, so we need to put this in context.
The difference here is the nature of how people communicate. It is right to say that—I rise to be helpful to the Minister—the character of encryption, in particular, is making it harder, even in the kind of serious cases that have been described, for those who are missioned to keep us safe to do so by accessing the information they need. So it is right that the law needs to be updated. The critical thing for me, therefore, is this matter of the threshold, which was debated when we debated the original Act.
As far as I understand, this Bill does not change the threshold; it reinforces the threshold. If that is the case and, as has been said, exceptionality is a measure of significance and not complexity—some cases will be complicated, but it is about significance—then the only outstanding difference, as the Minister has said, is oversight. I think the reporting in the annual report matters—the right hon. Member for North Durham made that point—and that would be a small concession to make, if I can describe it as such. I take the point about alacrity, too. What we cannot do is slow down the process by making it bureaucratic.
I think there is an easy way out of this. Being very clear about thresholds, as the Minister very helpfully has been today, is perhaps the way out of it. To clarify that in writing might be helpful.
Mr Jones
I do not think anyone could describe the right hon. Member for South Holland and The Deepings or myself as woolly liberals, but I do have a concern with this. Where we are giving an extra power—which is what this is, although the Minister disagrees about the breadth—I want to ensure somehow that, in a democracy, we have oversight of it. I do not want to make it difficult for the agencies to implement their powers, but there are simple ways of doing so. That could mean telling the IPC when it occurs.
I have faith in the internal mechanisms that the Minister refers to, but I was also on the Intelligence and Security Committee in 2017, when we did our rendition and detention inquiry. All the safeguards were in there then, and they were ignored. That led to some fundamental changes, including the Fulford principles. There are occasions when the best things in legislation are not followed through, and that can lead to some very serious consequences.
Tom Tugendhat
I take the right hon. Gentleman’s point and the spirit in which it was made. I reiterate that requests for communications data must be approved by the Investigatory Powers Commissioner’s Office, as he knows, unless they are urgent or for the purposes of national security. That is where this is being focused. Condition D, which we have spoken about, will be restricted to only the intelligence services and the National Crime Agency when it is pursuing a national security element within its remit—that is a separate area, as he knows. Those organisations have the necessary expertise to raise compliant and proportionate restrictions.
Again and again, the principle in the Bill is that the least intrusive power must be used. The oversight starts internally, but very rapidly goes externally, whether it is to IPCO or a judicial commissioner. The ability to review is always there, and the penalties under section 11 of the 2016 Act, which we all hope will never be needed or used, are pretty onerous on anybody who abuses their power or in any way exploits their ability in order to conduct themselves in a way that we would all agree is unsatisfactory in a democracy. It is really important to say that.
Going back to the question raised by the hon. Member for Midlothian, the reality is that condition D applications will limit collateral intrusion as much as is reasonably practical. The returned data may only provide an indication of involvement in an investigation, and further analysis will likely be necessary to allow fuller determination. That is the nature of handling intelligence data and then conducting an analysis on the back of it. In all cases, that activity will have to be justified, and will be no more than is necessary to achieve the desired outcome.
To be absolutely clear, that has to be targeted. This is a series of circles in a Venn diagram to target as narrowly as possible. Were others to be captured in that narrowest possible target, that data could not be held, or a separate application would have to be made in order to hold it. For example, one can imagine a circumstance in which an intelligence agency is targeting a paedophile on a particular street. Using different forms of communication technique, it narrows it down from a handset to an operator, a particular website, a particular time, and so on, so the Venn diagram narrows—it is very focused. If it turns out that there is another paedophile operating in exactly the same area at that time, that would require a separate application, because it is a separate target. The data could not just be held. Nor would it be ignored—I am sure the hon. Gentleman would not suggest it should be. But the judicial oversight needs to be gone through and the application needs to be made. It is a separate warrant, and so on.
Mr Jones
In the example the Minister gives, at the same time the agency targets that individual, it will have a lot of other people who communicated with that individual. How long will that information be kept? That is the concern people have. It is not the depth, but this is broad. Most of those people would be completely innocent of anything. There is then the issue of how long that information is kept and who makes the decision about how long to keep it.
Tom Tugendhat
Forgive me, but I disagree with the right hon. Member on this. It is unlikely that there would be a large number of people at a specific geographic location, using a specific cell site, from a specific handset, viewing a specific website at a specific time. Once it is narrowed down like that, the numbers are very small. That does not mean that any intrusion that is not legally authorised is acceptable—that is absolutely not what I am saying. But we are getting down to very small numbers of people, and quite deliberately so, in order to achieve an intelligence outcome.
Stuart C. McDonald
As I understand it, the Minister is describing the powers that already exist under the 2016 Act. If we are down to that level of knowledge of where, when and who, then what in the Bill goes beyond that? I do not follow.
Tom Tugendhat
In the existing Act, one would have to be entirely specific about a particular time. It could not be 5.30 pm to 6.30 pm; an internet connection record could be done only at 5.30 pm exactly. The Bill extends that a bit, but it still has to be very targeted. This is a proportionate change in the law to allow the intelligence services to collect information that would enable the targeting of serious and organised crime.
Mr Jones
Let me go back to the Trainline example. Suppose it is not child exploitation—the Minister is possibly right that it is specific, and hopefully there are not many people in one street—and someone is trying to look for a person’s travel plans, so they want to know how many people in an area have contacted Trainline. It will be more than one person, so there will be a lot of other people they are not looking for in there. That is the problem, and that is all that the ISC, the hon. Members for Midlothian and for Glasgow South and the Labour Front Benchers are saying.
Earlier the Minister used the words “control from outside”. I am sorry if he sees oversight as control, but I certainly do not. It is about giving confidence to the public that there is independent oversight over these powers, whether that is informing the IPCO when they are used or having pre-authorisation, as was suggested earlier. I do not see the problem with keeping people informed. The Minister is hiding behind IPCO, but it was introduced in the first place to give the public confidence.
Tom Tugendhat
I suspect we are not going to come to an agreement on this, so I will probably leave it after this point. The IPCO oversight means that IPCO can look at a request at any point. The maximum period it can go without looking at it is 12 months, but it can look at any point. We have said that requests for communications data must be approved by the Investigatory Powers Commissioner’s Office
“except where they are urgent or are for the purpose of national security”.
That interaction, which the right hon. Gentleman rightly supports, is already there, so I do not accept it is lacking.
On the question of proportionality, the amount of information that one may need to investigate a paedophile network, for example, may mean being slightly vaguer about the specific time, whereas following a known individual may require different forms of flexibility and proportionality. I am afraid I am going to be very cautious about setting out what each one means, because these principles will have to adapt and be applied as appropriate.
Sir John Hayes
We are going to have to close this down and move on because we have other things to do. Perhaps the way through is, as was suggested a few moments ago, that this be reviewed over time. If in the annual report we have a really thorough examination of how the measure has been applied and in what circumstances—in broad terms, of course, because we do not need the details of the crimes—that would give us the assurance we need. Our Committee has made that point emphatically. That would be a terribly good way out of this and it would not be a huge step. If the Minister agrees to that, I would certainly be satisfied.
Tom Tugendhat
It is not for me to tell the ISC what it should look into, but I would be surprised if it did not want to look into this in great depth.
Sir John Hayes
I think the Minister might have misunderstood. Forgive me; I did not mean that. I meant that this could be reviewed in the IPCO annual report. That would obviously be considered by the ISC in the way he describes. I think we need a summary of how this will work in practice and a commitment that we do that now. He sort of talked about a retrospective review. Rather than debate this further now, that would be a very good way forward.
Tom Tugendhat
I am entirely supportive of the idea that IPCO should update the ISC and the Secretary of State about how it is working and provide information so that a proper view can be taken. I think that is entirely appropriate.
Mr Jones
Well, that would be fine if the Government did not redact things in IPCO reports and try to stop us getting access to—[Interruption.] I am sorry, but the Government are doing that. They have done it over the past few years. That is the problem. The Government are paying lip service to the ISC. We are not trying to thwart the work of our security services; we are an important part of the democratic oversight of them. That is why we were set up under the Justice and Security Act 2013. I am sorry to say that the Government are trying to drive a coach and horses through it, including by preventing information from IPCO from being given to us.
Tom Tugendhat
I think we have covered the area, and I have said all I am going to about the matter.
Question put and agreed to.
Clause 15 accordingly ordered to stand part of the Bill.
Clause 16
Powers to require retention of certain data
Question proposed, That the clause stand part of the Bill.
Tom Tugendhat
Section 87(4) of the IPA provides that a data retention notice cannot require the operator to retain so-called “third party data”. There is no intention to revisit the principle of this important provision, but technological advancements have highlighted some discrete and unintended consequences. For example, the Secretary of State is prevented from placing communications data retention obligations on a UK telecommunications operator in relation to data associated with users of a foreign SIM card within the UK.
Clause 16 addresses those unintended consequences and makes an exception for that data within Section 87(4), so that data in relation to roamers using a foreign SIM in the UK would be treated in an equivalent way to the data that could be retained in relation to users of UK SIM cards. Clause 16 also clarifies that communication data required for an internet connection record can be subject to a data retention notice. All existing safeguards will continue to apply.
Continuing to clause 17, the IPA already has extraterritorial effect. Data retention notices—or DRNs—and interception technical capability notices—or TCNs—can be given to a person overseas where there is an operational requirement, and it is necessary and proportionate to do so. However, only TCNs are currently enforceable in relation to a person overseas.
Clause 17 amends section 95 and 97 of the IPA to allow extraterritorial enforcement of DRNs, if required, for UK security purposes when addressing emerging technology and the increasing volume of data being held overseas, bringing them in line with interception TCNs. It is vital to have this further legal lever, if needed, to maintain the capabilities that the intelligence and law enforcement agencies need to access the communications data that they need to in the interests of national security and to tackle serious crime.
Stuart C. McDonald
I have some comments to make about extraterritoriality, but I will do so in the next debate.
Question put and agreed to.
Clause 16 accordingly ordered to stand part of the Bill.
Clause 17 ordered to stand part of the Bill.
Clause 18
Review of notices by the Secretary of State
Question proposed, That the clause stand part of the Bill.
Tom Tugendhat
The notice review mechanism is an important safeguard. If operators are dissatisfied with a notice that they are given, or with any part of it, they have a statutory right to refer it to the Secretary of State for a review. Clause 18 is essential to ensure that operators do not make any technical changes during the review period that would have a negative impact on existing lawful access capabilities.
Operators will not be required to make changes to specifically comply with the notice. However, they will be required to maintain the status quo. If there was lawful access at the point at which a notice was given, access to data must be maintained by the operator while the notice is being comprehensively reviewed. This will ensure that law enforcement and intelligence agencies continue to have access to vital data during that period in order to keep people safe.
To be clear, companies can continue to make technical changes or roll out new services during the review period, so long as lawful access remains unaffected. The status quo will apply only to services or systems specified within the notice; anything outside the scope of the notice will be unaffected. If, at the conclusion of a review, the Secretary of State confirms the effect or varies the notice, maintaining the status quo will be vital to ensure that law enforcement and intelligence communities do not lose access to data during the review period that they would otherwise have been able lawfully to obtain. In the Lords, the Government amended the Bill to introduce a timeline for the review of a notice.
Dan Jarvis
I will be very brief. I am grateful for the Minister’s remarks, but I want to raise the concerns of some telecommunications operators and of organisations representing the sector about clauses 18 and 19. These include a view that the role of the proposed new notices regime would hinder and even veto product development.
I know that the Minister and his Department have engaged with stakeholders about those concerns, as have Labour Members. I would be grateful if the Minister briefly set out whether recent engagement has taken place with stakeholders with regard to these matters, and whether he has any further plans to address the concerns that they have expressed about clauses 18 and 19.
Stuart C. McDonald
I want to make a similar case. We are now getting into territory where I struggle to understand exactly what is going on, because I am not a tech geek. We are speeding past this measure almost as if it were inconsequential, but the language in some of the briefings that we have received about it is pretty dramatic.
The bundle that was emailed to Committee members this morning includes evidence from Apple that I think needs to be addressed:
“At present, the SoS must navigate important oversight mechanisms before they can block the offering of a new product or service they believe will impact…ability to access private user data.”
Apple summarises the suite of clauses that the Committee is considering, including the requirement in clause 18 to maintain the status quo during the review process, as allowing the Secretary of State
“to block, in secret, the release of a product or service even before the legality of a Technical Capability Notice can be reviewed by independent oversight bodies. The effect of this amendment will be to, extraordinarily, hand the SoS the power to block new products or services prior to their legality being ascertained. This result upends the balance of authority and independent oversight Parliament struck in the IPA.”
Given the new definition of “telecommunications operator” in clause 19, Apple has also warned that there will be serious implications for conflicts with other laws, including the EU GDPR and with US legislation.
As well as Apple, we have heard from various other organisations. TechUK has highlighted problems with broadening the definition of “telecommunications provider” before control of provision of a telecoms service, including to UK users, is established overseas. It also highlights the potential conflict of laws. What if the domestic law in the country in which a company is based does not allow for compliance with the notice that the Home Secretary has delivered? That company might not even be able to raise the issue of a conflict of laws, because it would be sworn to secrecy under the Bill.
According to TechUK, the proposed changes mark a departure in the way that the UK approaches the extraterritorial reach of the UK or UK laws and the consequential conflicts of laws. That was all recognised in the 2016 Act, in which a partial solution was found in the form of a UK-US agreement. Currently, however, the Government have not set out any plans to work towards equivalent solutions.
In relation to clause 21, I will raise similar concerns from other experts, but it is clear that some very serious companies and organisations have significant concerns about what the combination of these notices may end up delivering. Those concerns need addressed.
Tom Tugendhat
I thank hon. Members for the spirit in which they have engaged. To be clear, it is absolutely right that we listen to representations from companies around the world, as I am absolutely sure all Members across the House would expect. We are still engaged in conversations: the Home Secretary was on the west coast of the United States only last week, I think, and I maintain regular communication with many different companies, including many of the same companies to which the hon. Member for Cumbernauld, Kilsyth and Kirkintilloch East referred.
Let me be quite clear about one aspect. There is a real challenge here, and it is absolutely worth getting to the heart of it. The way in which communications data has evolved means that there are now jurisdictions in which the UK cannot protect its citizens without the co-operation of certain companies overseas. That was always bound to happen to a certain degree, but it is now very much the case: I do not know whether the hon. Gentleman has children, but he will know that many children use tablets and internet-connected devices in their bedroom.
The reach of these companies into the personal life of children in our country has to be a matter of concern to the British Government—it just has to be. The question is who governs these spaces. Are they governed by the association agreements and terms and conditions of the companies, or are they governed by the laws of the United Kingdom passed by Members of this House, of whichever party? That is the fundamental question.
The jurisdiction of this House must be sovereign. If sovereignty is to mean anything, it must mean the ability to protect our children from serious harm. That is basic. Under the IPA and previous legislation going back to the 1980s, this House has always exercised a certain element of influence. Yes, the Bill is extraterritorial, but so are many other Bills that this House passes in relation to the protection of our citizens and our interests. We can have operational reach further than the UK border in order to protect our citizens. That is what we are doing here, and that is what makes it proportional.
It is true that there are conflicts of interest that we have to resolve. I must be honest with the hon. Gentleman: this has come up before. It has even come up in my time. It is something that we have to look at in order to ensure that we address those conflicts and see where the balance of proportionality lies.
It is our very good fortune that many of the conflicts arise between jurisdictions with which we are extremely close. The United States, for example, is an extremely close ally. We regularly—in fact, I regularly—have conversations with the US Justice Department and others to make sure that we manage those conflicts of interest in the best interests of all our citizens. It is unusual for us not to find a resolution, but there are means of dispute resolution when we do not. Although I take the hon. Gentleman’s point, it is not exceptional for companies rightly and understandably to defend their interests where they feel that they have a commercial advantage. That is, of course, reasonable.
The reality is that we are not stopping companies doing anything; we are asking them not to change our ability to protect our citizens, until we have found a fix. If they want to introduce a new product or service or change the way they operate, that is fine: it is nothing to do with us. All we ask is that they maintain our ability to protect our citizens during that translation and into the future.
Stuart C. McDonald
I will come on later to another line of argument that relates to the unintended consequences of these permissions, but for now I have a specific question. The Minister has spoken about how conflicts of law can be resolved. Is there not an added complication? If we put a notification notice—if we are calling it that—on a company, it cannot share the fact of that notification with anybody at all. Does that not make it well-nigh impossible to resolve the issue with conflicts of law?
Tom Tugendhat
Without going into details that it would be inappropriate to share: no, it does not. I can assure the hon. Member that this is a long-standing practice that has been tested, and it does operate.
On clause 19, I wish to put one further point on the record. The clause will amend the definition of a telecommunications operator, out of an abundance of caution, to ensure that the IPA continues to apply to those to whom it was intended to apply, building on the work that my right hon. Friend the Member for South Holland and The Deepings has laid out. There are circumstances in which a telecommunications system that is used to provide a telecommunications service to persons in the United Kingdom is not itself controlled from the United Kingdom; we have talked about some of those services. The clause will ensure that multinational companies are covered in their totality in the context of the IPA, rather than just specific entities.
Clause 19 does not seek to bring additional companies within the scope of the definition, nor does it seek to constrain how a company structures itself. It is a clarificatory amendment that will improve the effectiveness and efficiency of the regime and the process of giving notices.
Question put and agreed to.
Clause 18 accordingly ordered to stand part of the Bill.
Clause 19 ordered to stand part of the Bill.
Clause 20
Renewal of notices
Question proposed, That the clause stand part of the Bill.
Tom Tugendhat
Currently, a notice must be kept under regular review by the Secretary of State, but it does not cease to have effect unless the Secretary of State revokes it. The clause will introduce a notices renewal process such that if two years have passed since a notice was given, varied or renewed, it must go through the double lock process to obtain the approval of a judicial commissioner, in addition to a full necessity and proportionality assessment by the Secretary of State. This change will provide reassurance to operators that their notice remains necessary and proportionate.
Question put and agreed to.
Clause 20 accordingly ordered to stand part of the Bill.
Clause 21
Notification of proposed changes to telecommunications services etc
Tom Tugendhat
I beg to move amendment 6, in clause 21, page 45, line 7, leave out first “person” and insert “relevant operator”.
This amendment and amendments 7, 8, 10, 11, 12 and 13 provide that the expression “relevant operator” is used consistently in inserted sections 258A and 258B of the Investigatory Powers Act 2016.
The Chair
With this it will be convenient to discuss the following:
Government amendments 7 to 13.
Clause stand part.
Tom Tugendhat
Clause 21 is required to safeguard lawful access to critical data, which is needed by law enforcement and intelligence agencies to keep the public safe from serious threats such as terrorism and child sexual exploitation.
Technology has advanced rapidly since 2016, presenting a risk to lawful access capabilities. Notification notices have been introduced in response to technological advancements and will require relevant operators who provide, or are expected to provide, lawful access to data of significant operational value to inform the Secretary of State of any technical changes that they intend to make that will have an impact on existing lawful access capabilities.
The requirement will apply only to relevant services or systems specified within the notice, which will be agreed in consultation with the operator, prior to the notice being given, and will not necessarily apply to all elements of their business. It should be noted that technical capability notices already contain a notification requirement; this is not a new concept to the IPA. The clause replicates the power as a standalone obligation within notification notices.
To be clear, there is no ability within the notification process for the Secretary of State to delay, prevent or alter the roll-out of the operator’s intended change. The requirement is needed to provide the Secretary of State—and, by extension, operational partners—with time to identify and evaluate any potential impact that the change may have on lawful access capabilities. It will also be important in giving operational partners time to adjust their ways of working to ensure that lawful access is maintained. The primary objective of the obligation is to create an opportunity for collaborative working between operators and Government to protect the crucial capabilities required to keep people safe.
Amendments 6 to 13 are minor and technical amendments to ensure consistency of language throughout the clause and the IPA.
Stuart C. McDonald
I want to pursue another line of argument that has been put to members of the Committee. I spoke earlier about the principles of the notification regime; I now want to probe the Government on the extent to which they have considered the possible unintended consequences of setting it up.
The evidence circulated this morning includes a letter from academics and experts from the United Kingdom and across North America, who express considerable concern about the outcome of the proposal. During the last debate, the Minister explained that the justification is that companies from across the world have a reach into children’s homes in the United Kingdom, and it is the duty of this Parliament and legislators to keep them safe. I do not think anyone would dispute that at all.
The experts argue that an unintended consequence of being as radical as the proposal in the Bill is that citizens in the United Kingdom could be less safe. Although the Government are trying to restrict the scope of the regime to what happens in the United Kingdom, in reality it will mean that certain updates and security features will not be rolled out to the United Kingdom. In fact, certain organisations may think twice about developing products for the UK market at all.
I am way outside my comfort zone, so I will go straight to what the experts argue in their evidence:
“If enacted, these proposals would have disastrous consequences for the security of users of services operating in the UK, by introducing bureaucratic hurdles that slow the development and deployment of security updates. They would orchestrate a situation in which the UK Government effectively directs how technology is built and maintained, significantly undermining user trust in the safety and security of services and products.”
They argue that this contains a significant risk of increased cyber-crime, as well as of endangering the encryption of important services. They conclude that
“these proposals are anathema to the best interests of UK citizens and businesses and internet users everywhere, and contradict universally accepted security best practices.”
I want to probe the Government on the extent to which they have considered the possible unintended consequences of how these companies may react to their proposals.
Tom Tugendhat
I thank the hon. Member for Cumbernauld, Kilsyth and Kirkintilloch East for the way in which he has approached the issue, and I am grateful to him for raising it, but I simply disagree. I disagree on the basis of advice that I have received from intelligence services, from UK-based companies, from the National Cyber Security Centre and indeed from many others.
Let us be quite clear. A notification notice does not create any conflicts of law, prevent any updates or prevent the application of any security patches. The only thing that it does is ask a company to keep the UK Government informed if it is going to change the way the UK Government will be able to protect British people. That has led to somewhat more caution in the reading than is necessary in reality; I have had many conversations with companies about that.
Stuart C. McDonald
This is a difficult area, but as I understand it, the argument is not that the notification notices themselves have that issue, but that the combination of notices, together with the technical capability notice, the new provisions in relation to review and the status quo, could give the Government that sort of power. That is the argument.
Tom Tugendhat
I hear the hon. Gentleman’s point. I will just say that many of these powers have been in place for a significant period. The situation that he describes is not one that we have found or noticed in any way at all. I believe that this is a case of people gilding a lily to turn it into lead.
Amendment 6 agreed to.
Amendments made: 7, in clause 21, page 45, line 8, leave out “person’s” and insert “relevant operator’s”.
See amendment 6.
Amendment 8, in clause 21, page 45, line 29, at end insert—
“‘relevant operator’ has the same meaning as in that section.”
See amendment 6.
Amendment 9, in clause 21, page 45, line 35, leave out “notice, as varied,” and insert “variation”.
This amendment provides that references to the variation of a notice are used consistently in Chapter 1 of Part 9 of the Investigatory Powers Act 2016.
Amendment 10, in clause 21, page 46, line 2, leave out first “person” and insert “relevant operator”.
See amendment 6.
Amendment 11, in clause 21, page 46, line 2, leave out second “person” and insert “relevant operator”.
See amendment 6.
Amendment 12, in clause 21, page 46, line 5, leave out “person” and insert “relevant operator”.
See amendment 6.
Amendment 13, in clause 21, page 46, line 6, leave out “person” and insert “relevant operator”—(Tom Tugendhat.)
See amendment 6.
Clause 21, as amended, ordered to stand part of the Bill.
Clause 22
Interception and examination of communications: Members of Parliament etc
Tom Tugendhat
I beg to move amendment 3, in clause 22, page 47, line 17, leave out from “and” to end of line 19 and insert—
“(b) has the necessary operational awareness to decide whether to give approvals under subsection (2).”
This amendment replaces the reference to an individual being required in their routine duties to issue warrants under the Investigatory Powers Act 2016 with a reference to an individual being required to have the necessary operational awareness to decide whether to give approvals under section 26 of that Act.
Tom Tugendhat
Government amendments 3 and 4 require that any Secretary of State to be designated by the Prime Minister as an alternative approver must have the necessary operational awareness of the warrantry process to undertake the role. This change will replace the current drafting inserted in the House of Lords relating to “routine duties”, which is over-restrictive and will undermine the resilience of the triple-lock process that the clauses seek to safeguard.
Requiring relevant operational awareness will ensure the necessary flexibility and resilience while maintaining a proportionate scope for delegation. It will allow scope to include those who may be new to their role and do not yet carry out such duties routinely, or who no longer carry them out routinely due to machinery-of-government changes but have valuable pre-existing knowledge that makes them a suitable alternative approver.
Sir John Hayes
I am grateful to the Minister for the fact that his amendment goes some way to dealing with the issues that I and others raised in relation to the change from existing practice. At the moment, the Prime Minister provides the element of what has been described as the triple lock. The Government proposal is that other Secretaries of State should perform the role when the Prime Minister is unable to for a number of reasons. My anxiety, reflected by the Intelligence and Security Committee, is that those Secretaries of State who act for the Prime Minister in such circumstances should be people with operational experience. Typically, that would mean people with warranting powers—people accustomed to the business of issuing warrants, with all that that suggests.
The Government amendment speaks of operational awareness. I think “operational experience” is a better turn of phrase, although I accept the Government’s point that if there was a new Secretary of State—a new Home Secretary would be a good example—they would not necessarily have experience. By definition, they would be new in the job, whether that was the Home Secretary or Foreign Secretary and so on. It might be possible to speak of experience and responsibilities, so it could be either responsibilities or experience. Of course, the Government rightly say that a former Home Secretary, Foreign Secretary or Northern Ireland Secretary who was then doing a different job in Government could be one of the people designated, so I take that point.
The issue here is ensuring that the people who perform the role are competent to do so, and I know that is something on which we agree. It is really a matter of the semantics, but semantics are not always insignificant. I am aware of bolshevism and liberalism, but I would not want anything to do with either of them. I am aware of the separatist case on the United Kingdom, but awareness is as far as I want to go with that—I say that without contention or, indeed, acrimony of any kind. I am not sure that “awareness” is quite the right word, and I simply offer that semantic but not insignificant point to the Minister for his consideration.
Dan Jarvis
I rise to speak briefly to Government amendments 3 and 4, which Labour welcomes. The principle of the appropriate Secretary of State giving approvals under section 26 of the Act was raised in the amendments proposed by Lord Coaker and Lord West in Committee in the other place. The amendments are an important further clarification regarding which Secretaries of States are eligible to be delegated the prime ministerial authority on investigatory powers relating to members. Necessary operational awareness demonstrated by the right people is, of course, crucial to ensure that the right decisions are made on what are, after all, very sensitive matters. I am mindful of the remarks made by the right hon. Member for South Holland and The Deepings, so it would perhaps be helpful if the Minister could say something about how recent—mindful of the debate about whether “recent” is the right word—this operational awareness should be.
Mr Jones
I think so, because the original wording talked about being able to nominate basically anybody. It was then defined, but the amendment widens it again. It says, “necessary operational awareness”; is that, for example, that any Secretary of State is aware that it is a voluntary process? For example, the Foreign Secretary and the Home Secretary sign warrants, and another Secretary of State could say, “Yes, I’m aware of that.” As the right hon. Member for South Holland and The Deepings said, “operational experience” would be better wording, because “necessary operational awareness” is too broad. What does it actually mean in practice? For example, must they have any experience of having signed a warrant before? Or do they just need to know that the warrantry system exists?
Tom Tugendhat
First, I place on the record my gratitude to the ISC, to which I have listened extremely carefully on this matter; indeed, the Bill has been changed because of it. Let me be clear that although many people are aware of things, to be operationally aware is not the same as to be just aware. Many people were aware of the conflict in Helmand, but I argue that only the hon. Member for Barnsley Central and I were operationally aware of the conflict in Helmand. It is rather a different requirement. It does not mean that one knows about the operation; it means one is aware in an operational sense of it. It is not just an observation of the challenge.
Mr Jones
I have to say that from my experience as a former Minister in the Ministry of Defence—I said I was never a Secretary of State—I was not only aware of what was going on but operationally aware. Could an Under-Secretary of State at the Ministry of Defence therefore be designated as one of these people? On Tuesday mornings every week, I was very operationally aware of what was going on in Helmand, for example.
Tom Tugendhat
First, this goes alongside the code of practice, which challenges the right hon. Gentleman’s point. It would need to be people who were briefed into the warrantry process. It needs to be somebody who understands what a warrant is, so it is not somebody who is merely observing it, such as a Secretary of State for Culture, Media and Sport.
On the point that my right hon. Friend the Member for South Holland and The Deepings made about experience, I understand the debate. There is a possibility—I know that he and I will do everything we can to prevent it—that there will be a change of Government soon. In that case, there will be an awful lot of people who have absolutely no experience at all of these matters. It would therefore be wise not to set up a provision that would immediately require amendment. Disappointed though we would be at that outcome, my right hon. Friend would agree that he would not want a law to be amended in its first year, if we could possibly avoid it.
To be clear, the Government view the four alternative approvers as being likely to be the Home Secretary, the Foreign Secretary, the Defence Secretary and the Northern Ireland Secretary. Only three would be able to act as the triple-locking Secretaries of State, because of course we would have already used up two of them to do the first two functions. That is why the numbers are required, and why I am incredibly grateful to the ISC for pointing it out and being very cautious on it.
Mr Jones
If what the Minister has just said is the case, why do the Government push back on a suggestion that I think they actually made earlier on? The Minister is now pushing back on it. Although I understand the need for the code of practice, if there was a change in it—because there might be sometime—would that come back to Parliament to be approved? We are dancing on the head of a pin here. I do not know why, but that is quite common with the Home Office. The Minister says that it will be mainly four people, but I would love to know what he means by “necessary operational awareness”, which is clunky language.
Tom Tugendhat
Codes of practice will be brought forward through regulations in the usual way, as the right hon. Gentleman is aware, and the House will scrutinise them in the usual way. This is a very legalistic process, as I recognise from the inside as much as he does from the outside. It is true that if, for example, the Northern Ireland Secretary became the Education Secretary, they could then be included. The idea is to ensure that it is somebody who is appropriate to the task, which is why the measure is worded as it is. I always listen to right hon. and hon. Members across the House. I believe that the amendment is the best version that we have come to so far. I will continue to listen to the right hon. Gentleman, as always.
Sir John Hayes
Given what the Minister said about a change in Government—I do not expect one, but I suppose it is a remote possibility—perhaps the words “operational responsibility or experience” would cover the point made and be slightly tighter than “awareness”. Also, there is the matter of notifying the PM. The Committee made the good suggestion that the PM should be notified as soon as practicable, which may be something with which the Minister agrees. If the Prime Minister were indisposed because of illness or whatever, they would be notified as soon as is practicable that a warrant had been issued.
Tom Tugendhat
On the second point, I am sure that, like me, my right hon. Friend finds it absolutely inconceivable that that PM would not be notified. I am not convinced that that must be in primary legislation. I find it genuinely inconceivable that the Prime Minister would not be notified at the earliest opportunity. Obviously, if they could be notified immediately, the provision would not be required.
Mr Jones
But, Minister, let us be honest: a lot of things that we would have taken for granted were ignored in Downing Street over the last few years. Until Boris Johnson became Prime Minister, it had been a great part of our constitution that convention was followed. Surely it would therefore be better to have the point about notification in the Bill; otherwise, we are leaving it to the free will of convention. I would have trusted convention, but we have had Boris Johnson as Prime Minister.
Sir John Hayes
I want to help the Minister, because I do not necessarily agree with the right hon. Member for North Durham; occasionally, he and I do disagree, despite the impression that we have created in this Committee. Notification could be covered in a piece of statutory guidance that supports the Bill. It could state that the Prime Minister should be notified as soon as reasonable practicable, exactly in the terms just described. How’s that?
Tom Tugendhat
As is so often the case, I absolutely agree with my right hon. Friend.
Tom Tugendhat
I will look at putting it in the guidance, as suggested by the right hon. Member.
Tom Tugendhat
I have said what I am going to say on the matter.
Amendment 3 agreed to.
Dan Jarvis
I beg to move amendment 17, in clause 22, page 47, line 26, at end insert—
“(2G) If a warrant is issued by an individual designated by the Prime Minister, the Prime Minister must be informed of that decision as soon as it is reasonably practical to do so.”
This amendment would require the Prime Minister to be notified of a decision of a designated Secretary of State to authorise the interception of certain elected representatives’ communications as soon as is reasonably practicable.
The Chair
With this it will be convenient to discuss amendment 18, in clause 23, page 48, line 21, at end insert—
“(7F) If a warrant is issued by an individual designated by the Prime Minister, the Prime Minister must be informed of that decision as soon as it is reasonably practical to do so.”
This amendment would require the Prime Minister to be notified of a decision of a designated Secretary of State to authorise a targeted equipment interference warrant relating to one of certain elected representatives as soon as is reasonably practicable.
Dan Jarvis
I am conscious of the debate that has just taken place, so I anticipate what the Minister may say in response. Let us give him another go anyway.
Amendments 17 and 18 relate to the decision of a designated Secretary of State to authorise the interception of elected representatives’ communications and interference with equipment relating to elected representatives. As the Minister will know, two similar amendments were proposed by Lord West in Committee in the other place. The reason for tabling the amendments in Committee in the Commons is that the Opposition believe that the Prime Minister’s overall involvement in the warrants must be retained, even if, in designated cases, it could be retrospective. As I said, I am mindful of the debate that has just taken place.
In the other place, Lord Sharpe rejected Lord West’s amendment on the basis that the oversight arrangements for warrant decisions taken by a designated Secretary of State, which include review by the judicial commissioner, are sufficient scrutiny. I understand that argument, but I wonder why it should not be the case that a Prime Minister is at least notified about decisions to issue warrants that they have had to delegate due to their being unable to do so. Furthermore, would a Prime Minister not being notified of a decision unnecessarily diminish their operational awareness in making future decisions to issue warrants?
My amendment would require the Prime Minister to be informed of a decision taken by a designated Secretary of State on their behalf as soon as the circumstances that have prevented the Prime Minister from approving a warrant in the first place have passed. I hope the Minister and the Committee will understand the emphasis on the important nuance in the difference between review and notification. Mindful of the earlier debate, I hope that the Minister will consider accepting the amendments.
Tom Tugendhat
For want of repeating myself, I will probably leave that to stand.
Mr Tobias Ellwood (Bournemouth East) (Con)
We are speaking about elected representatives who are then appointed into Government and make decisions, and we have rightly had an important debate, to which the Minister has responded. If possible, it would be helpful if he could confirm who from the agencies would also be involved in the decision making. That would add some faith as to the robustness of the decision making that takes place when such actions are taken.
Tom Tugendhat
I am cautious about answering that question, for the simple reason that it depends on where and how the information was gathered, whether it was gathered deliberately or accidentally as part of an existing operation, and whether it was tangential. It is absolutely inconceivable that the chief of whichever agency it was would not be aware and therefore not part of that conversation.
Dan Jarvis
I suspect that we may return to this matter on Report. On the basis of the remarks made by the Minister, I beg to ask leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Question proposed, That the clause stand part of the Bill.
The Chair
With this it will be convenient to discuss the following:
Clause stand part.
Clause 23 stand part.
New clause 1—Requirement for the Prime Minister to appear before the Intelligence and Security Committee—
“After section 26 of the Investigatory Powers Act 2016, insert—
‘26A Requirement for the Prime Minister to appear before the Intelligence and Security Committee
(1) The Prime Minister must appear before the Intelligence and Security Committee of Parliament to provide oral evidence on the matter set out in subsection (2).
(2) The matter is decisions made by the Prime Minister or an individual designated under section 26 to—
(a) give approval to issue warrants to intercept and examine communications of Members of Parliament;
(b) interfere with equipment belonging to Members of Parliament;
(c) other relevant decisions relating to Members of Parliament in the interests of national security
(3) The duty in subsection (1) applies once every session of Parliament.
(4) Subsection (1) does not apply if the Intelligence and Security Committee does not require the Prime Minister to attend.’”
This new clause would require the Prime Minister to appear before the Intelligence and Security Committee to provide oral evidence on decisions made to approve warrants to intercept and examine communications of MPs or to interfere with equipment belonging to MPs, and other relevant decisions relating to MPs.
New clause 4—Interception notification for Members of Parliament etc.—
“After section 26 of the Investigatory Powers Act 2016 (Members of Parliament etc.) insert—
‘26A Interception notification for Members of Parliament etc.
(1) Upon completion of conduct authorised by a warrant under section 26, or the cancellation of a warrant issued under that section, a Judicial Commissioner must notify the subject of the warrant, in writing, of—
(a) the conduct that has taken place, and
(b) the provisions under which the conduct has taken place.
(2) The notification under subsection (1) must be sent within thirty days of the completion of the conduct or cancellation of the warrant.
(3) A Judicial Commissioner may postpone the notification under subsection (1) beyond the time limit under subsection (2) if the Judicial Commissioner assesses that notification may defeat the purposes of an ongoing serious crime or national security investigation relating to the subject of the warrant.
(4) A Judicial Commissioner must consult the person who applied for the warrant in order to fulfil an assessment under subsection (3).’”
This new clause would require members of a relevant legislation who are targets of interception to be notified after the fact, as long as it does not compromise any ongoing investigation.
Tom Tugendhat
Clauses 22 and 23 will increase the resilience and flexibility of the warrant system. They will ensure the effective processing of warrants that authorise the interception of, or the use of equipment interference to obtain, the communications of a Member of a relevant legislature when the Prime Minister cannot fulfil their duties due to medical incapacitation or a lack of access to secure communications. The changes will enable the authorisation process to function in an agile manner, thereby enabling the important work of the intelligence agencies to continue while maintaining a high bar for the authorisation of some of the most sensitive warrants.
Dan Jarvis
I rise to speak to new clause 1, which relates to oversight by the Intelligence and Security Committee of warrants to intersect and examine the communications of Members or the interference with equipment relating to Members. The context of the new clause will be clear to those who followed the debates in the other place about the role of the ISC. To be absolutely clear, I am not seeking to debate the Wilson doctrine—I know that Members will be relieved to hear that.
The purpose of the new clause is to probe and seek further safeguards for the ISC to provide essential oversight of this extremely sensitive matter, codified by the 2016 Act as part of a wider context of decisions made by the Prime Minister in the interests of national security. Members of this Bill Committee who also serve on the ISC will know that successive Prime Ministers have, unfortunately, not appeared in front of that Committee since, I believe, 2014. As a result, there has been no opportunity for direct accountability over prime ministerial decision making on warrants to intercept and examine Members’ communications, or on interference with equipment relating to Members.
Stuart C. McDonald
I shall speak to new clause 4. We are discussing our very important role as legislators—people who have to scrutinise the Government to represent our constituents. Any interference with that role, and any surveillance of us, is a matter of great significance and some controversy, so there should be as much oversight and transparency as possible. I am not a member of the ISC, and I do not know whether this is something the Minister will be able to tell us, but I would be interested to know how often powers have been used to institute surveillance on MPs in each and every of the past few years.
New clause 4 allows us to debate the possibility of post-surveillance notification. That proposal was debated in the House of Lords, but I think it is something that MPs should be alive to as well. Post-surveillance notification would give judicial commissioners a mandatory duty to notify parliamentarians subject to surveillance once a particular operation or investigation had ended. That would typically introduce a further safeguard to protect democracy and our role as legislators, and would ensure the Government are complying with their obligations under article 8 of the European convention on human rights.
Various objections were made to that line of argument in the House of Lords. For example, it was argued that notification would risk revealing sources or methods. That does not have to be the case; post-surveillance notification can inform an individual of the fact of past surveillance without having to disclose such information. Such a post-surveillance notification regime works in Germany, for example.
In particular, there would be no risk—this was alleged by the Government in the House of Lords—of affording judicial commissioners any operational decision-making power. That is because notification would occur only when a surveillance operation was no longer active and, secondly, any such notification regime could allow the judicial commissioner to consult whomever applied for the warrant in the first place. I am absolutely open to a discussion with the Government about the safeguards that would needed to allow such a measure to be implemented.
The other line of argument pursued by the Government in the House of Lords was that redress is already available to parliamentarians thorough the Investigatory Powers Tribunal. As we all know, however, if someone does not know that they have been subject to surveillance, they have no reason to go to the tribunal in the first place.
This proposal is not without some difficultly, but it is worthy of discussion. The Government’s resistance to it has not always stacked up so far, so I look forward with interest to hearing what the Minister will say.
Tom Tugendhat
On the point about notification: forgive me, but it is inconceivable that it should be required in law to inform somebody that they have been subject to an investigation by the intelligence services in such a way. I would be delighted to discuss with the hon. Member for Cumbernauld, Kilsyth and Kirkintilloch East in a more secure environment why, for a whole series of reasons, that may not be such a good idea. On the question of the Prime Minister appearing before the ISC, my friend the hon. Member for Barnsley Central knows my views—I have expressed them on many occasions—but that is way above my pay grade.
Dan Jarvis
For now!
Question put and agreed to.
Clause 22 accordingly ordered to stand part of the Bill.
Clause 23
Equipment interference: Members of Parliament etc
Amendment made: 4, in clause 23, page 48, line 15, leave out from “and” to end of line 17 and insert—
“(b) has the necessary operational awareness to decide whether to give approvals under subsection (3) or (6).”—(Tom Tugendhat.)
This amendment replaces the reference to an individual being required in their routine duties to issue warrants under the Investigatory Powers Act 2016 with a reference to an individual being required to have the necessary operational awareness to decide whether to give approvals under section 111 of that Act.
Clause 23, as amended, ordered to stand part of the Bill.
Clause 24
Issue of equipment interference warrants
Question proposed, That the clause stand part of the Bill.
Tom Tugendhat
The Bill makes minor changes to the equipment interference regime, specifically in relation to the warrantry processes associated with its authorisation. The purposes behind those changes are to correct minor drafting errors in the IPA to provide greater clarity, and to improve the efficiency of the warrantry process for equipment interference.
Question put and agreed to.
Clause 24 accordingly ordered to stand part of the Bill.
Clauses 25 and 26 ordered to stand part of the Bill.
Clause 27
Bulk equipment interference: safeguards for confidential journalistic material etc
Dan Jarvis
I beg to move amendment 19, in clause 27, page 50, line 9, at end insert—
“(2A) Where a senior official acts on behalf of the Secretary of State under subsection (2), they must inform the Investigatory Powers Commissioner of the selection for examination of BEI material as soon as reasonably practicable.”
This amendment would require a senior official acting on behalf of the Secretary of State who has selected BEI material for examination when there has been an urgent need to do so to inform the Investigatory Powers Commissioner as soon as reasonably practicable.
Dan Jarvis
Amendment 19 would require a senior official acting on behalf of the Secretary of State who has selected bulk equipment interference material for examination, when there has been an urgent need to do so, to inform the Investigatory Powers Commissioner as soon as is reasonably practical. It would ensure that every reasonable oversight arrangement was in place concerning the Bill’s investigatory powers provisions.
The amendment does not suggest that the Investigatory Powers Commissioner retrospectively reviews the approval, but instead proposes that they be informed to ensure that there are the most comprehensive and effective oversight arrangements on investigatory powers. We intend not to burden the police and the security services with additional duties, but to ensure that there is the maximum possible oversight with the minimum possible additional work. I hope that the Minister will at least agree with the intentions of the amendment and consider its merits in further strengthening the Bill’s oversight arrangements.
Tom Tugendhat
I welcome the amendment, and not only do I agree with it, but I feel that we have already done it. My understanding is that the provision duplicates what already occurs in practice under the current regime, as well as the changes made by clause 27. Currently, the Investigatory Powers Commissioner is already effectively notified when a senior official acting on behalf of the Secretary of State, in urgent circumstances, approves the selection for examination of journalistic material derived from bulk equipment interference. Clause 27 already inserts into the IPA new section 195A(2), which will ensure that the Investigatory Powers Commissioner is notified as soon as is reasonably practical by the Secretary of State when a senior official approves the use of criteria to select for examination journalistic material in reliance on an urgent approval. Effectively, the senior official is informing on behalf of the Secretary of State, or indeed the Secretary of State is informing on behalf of the senior official. We all very much hope it is the former of the two.
Clause 27 enhances the safeguards already afforded to journalistic material within the IPA, and the Government recognise the importance of journalistic freedom within free and democratic societies, which is why we are introducing this measure. Under the current regime, the Investigatory Powers Commissioner must be informed when a communication that contains confidential journalistic material or sources of journalistic material is retained following its examination for purposes other than its destruction. The clause introduces a requirement for prior independent approval by the IPC before any search criteria are used to select such material. Prior independent approval is also required before it is removed.
Dan Jarvis
I am grateful to the Minister for that clarification. On that basis, I beg to ask leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 27 ordered to stand part of the Bill.
Clause 28
Exclusion of matters from legal proceedings etc: exceptions
Question proposed, That the clause stand part of the Bill.
Tom Tugendhat
Clause 28 will amend schedule 3 to the Investigatory Powers Act 2016 to provide exceptions for disclosures of intercepted materials to inquiries or inquests in Northern Ireland or Scotland into a person’s death. The clause will create parity with existing provisions for coroners in England and Wales. It also adds an exception to enable panel members of the Parole Board in England and Wales to access intercepted materials when considering parole applications and any subsequent appeals. It will also enable relevant coroners in Northern Ireland and sheriffs investigating deaths in Scotland to access intercepted material in connection with their inquiry or inquest.
Question put and agreed to.
Clause 28 accordingly ordered to stand part of the Bill.
Clause 29
Freedom of information: bodies dealing with security matters
Question proposed, That the clause stand part of the Bill.
Tom Tugendhat
Under the Freedom of Information Act 2000, the Investigatory Powers Commissioner’s Office is not, and never has been, a public authority within the scope of the Act. The lack of control over the onward disclosure of information related to the functions of the judicial commissioners raises security concerns and has the potential to compromise the IPC’s inspections, which are often, by their very nature, intrinsically sensitive. The clause would prevent sensitive intelligence being further disclosed under the FOIA once such information is supplied by IPCO to a public body.
Question put and agreed to.
Clause 29 accordingly ordered to stand part of the Bill.
Clause 30
Power to make consequential provision
Question proposed, That the clause stand part of the Bill.
The Chair
With this it will be convenient to discuss the following:
Clauses 31 and 32 stand part.
Government amendment 5.
Clause 33 stand part.
Tom Tugendhat
Clauses 30 to 33 are typical clauses that are included in the vast majority of legislation. Clause 30 allows the Secretary of State, by regulations made by statutory instrument, to make provision that is consequential on this Act. Clause 31 details the extent of the Bill. The Bill extends and applies to the whole of the United Kingdom, with the exception of measures contained in clause 28, in which subsection (2) applies to England and Wales only and subsection (3) applies to Northern Ireland and Scotland only.
As national security is a reserved matter, a legislative consent motion is required from Scotland only in relation to a small number of clauses in part 2—the oversight aspect—of the Bill. I am pleased that the Scottish Government have recommended that legislative consent be given.
Clause 32 details when the Bill commences. Part 6 comes into force on the day on which the Bill is passed; the other provisions come into force on such day as is appointed by regulations made by the Secretary of State.
Question put and agreed to.
Clause 30 accordingly ordered to stand part of the Bill.
Clauses 31 and 32 ordered to stand part of the Bill.
Clause 33
Short title
Amendment made: 5, in clause 33, page 56, line 1, leave out subsection (2).—(Tom Tugendhat.)
This amendment removes the privilege amendment inserted by the Lords.
Clause 33, as amended, ordered to stand part of the Bill.
New Clause 2
Report on the Prime Minister’s engagement with the Intelligence and Security Committee
“After section 240 of the Investigatory Powers Act 2016 insert—
“240A Report on the Prime Minister’s engagement with the Intelligence and Security Committee
(1) The Secretary of State must publish a report about the Prime Minister’s engagement with the Intelligence and Security Committee in relation to the investigatory powers regime and lay the report before Parliament.
(2) The report must be published within six months of the passage of the Investigatory Powers (Amendment) Act 2024, and annually thereafter.””—(Dan Jarvis.)
This new clause would ensure the Secretary of State publishes a report on the engagement, including any meeting held, between the Prime Minister and the Intelligence and Security Committee in relation to the investigatory powers regime.
Brought up.
Dan Jarvis
I recognise that we have already had an extensive debate on this matter. I do not intend to detain the Committee any longer, and there is therefore nothing further I wish to say about new clause 2, so I do not wish to move it.
New Clause 3
Impact of Act on EU data adequacy decisions
“Within six months of the passage of this Act, the Secretary of State must publish a report assessing the potential impact of this Act on EU data adequacy decisions relating to the United Kingdom.”—(Dan Jarvis.)
This new clause would require the Secretary of State to publish a report on potential impact of the provisions within this Bill on the requirements necessary to maintain a data adequacy decision by the EU.
Brought up, and read the First time.
Dan Jarvis
I beg to move, That the clause be read a Second time.
New clause 3 relates to the impact of the Act on EU data adequacy decisions. When a similar measure to this new clause was proposed by my noble Friend Lord Coaker during the Bill’s passage through the other place, the response from the Minister, Lord Sharpe, confirmed the UK Government’s regular contact with the European Commission about the Bill to ensure that any changes are understood. We welcome that but, as I hope the Minister will understand, such engagement is a continuous process, not a single event or even a series of events. As part of this continuous process, we believe that the Secretary of State should publish a report assessing the potential impact of the Act on EU adequacy decisions.
As Lord Coaker said in the other place:
“The adequacy agreement is dependent on the overall landscape of UK data protections”.—[Official Report, House of Lords, 23 January 2024; Vol. 835, c. 688.]
That is even though the UK protections require some further work. However, given the time pressures, Mrs Cummins, that is all I will say about new clause 3.
Tom Tugendhat
First, I welcome the interactions we have had on this point, as well as the work of Lord Coaker and Lord Sharpe to ensure that this is widely understood. The work that has been done is important. We face the challenge that although we obviously commit to fulfilling our side of the TCA and the various agreements we have struck, this is really a matter for the European Commission to determine, so it is not one that we can pass into UK law. It is really a matter for them.
Dan Jarvis
I have nothing further to add. I beg to ask leave to withdraw the motion.
Clause, by leave, withdrawn.
Tom Tugendhat
On a point of order, Mrs Cummins. I would like to express my extreme personal thanks to Tom Ball and the Bill team, Phoebe, the Lucys, and the many others who have contributed brilliantly to ensure that this Bill has proceeded with speed and professionalism. I thank not only the members of the Committee, but all Members of many parties, and particularly the ISC, which has contributed so much to this Bill, despite what the right hon. Member for North Durham claims. May I say a particular thanks to my very good friend and shadow, the hon. Member for Barnsley Central? It is an enormous pleasure to think that we have gone from fighting the Queen’s enemies to passing the King’s laws together.
Dan Jarvis
Further to that point of order, Mrs Cummins. I join the Minister in warmly extending my thanks on behalf of Labour to all members of the Public Bill Committee and all the officials, both in the Department and in the House, who have done a sterling job in getting us to this point. I am grateful to the Minister for his collegiate approach, which I very much hope we will be able to maintain during the further passage of the Bill. Thank you, Mrs Cummins.
Peter Dowd
Further to that point of order, Mrs Cummins. May I say a particular thanks to you for chairing this Committee today in such a fantastic and eloquent way?
Sir John Hayes
Further to that point of order, Mrs Cummins. Since we are having further points of order, I want to say to the Minister, and the shadow Minister, how grateful I think most of the Committee are for the way this Bill has been conducted. This is a really good example of how a measure can be considered in Committee in a way that is not nakedly partisan or, worse, spiteful. I simply say to the Minister that I do regard the original Act as my child, and I see him as its foster parent, so he had better do a good job.
Bill, as amended, to be reported to the House.
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backbench business
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LGBT History Month
(2 months ago)
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Elliot Colburn (Carshalton and Wallington) (Con)
I beg to move,
That this House has considered LGBT History Month.
It is a pleasure to serve under your chairmanship, Mr Stringer. LGBT History Month was in February, and as co-chair of the all-party parliamentary group on global LGBT+ rights, which I am delighted to co-chair with the hon. Member for Wallasey (Dame Angela Eagle), I thank the Backbench Business Committee for allowing time for us to discuss the topic. It has become something of an annual debate, so I do not want to repeat too much of what we have said before. However, having looked through Hansard at some of our previous debates on the topic, it is a shame that we have to repeat a lot of what has been said on what we need to do in the UK and around the world to further advance the rights of LGBT+ people.
I want to stress a point that we as colleagues in this place have made on a number of occasions. LGBT+ people have always existed; we did not just pop out of the ground in the 1960s and 1970s and start marching through the streets of London and other cities. I worry about that idea sometimes, particularly with the rhetoric around trans people that has developed over the last few years. During the debate on the Conversion Practices (Prohibition) Bill last Friday, one colleague justified not supporting taking that Bill to Committee by saying, “Well, you know, we just never saw anything about trans people when we were younger.” Of course not—they were not allowed to be public. As LGBT+ people, we were legislated to stay in the closet. The law did not allow us to be open and free, so of course we did not have the ability to be open and free as we are today. That is a bit of a ridiculous argument.
I will begin by talking about some of the positive steps that have been taken around the world since we last held the debate. The International Lesbian, Gay, Bisexual, Trans and Intersex Association maintains a database of laws around the world, which includes dashboards showing which countries criminalise same-sex acts, and a chart showing decriminalisation year by year. When we were here last year, we celebrated the fact that Antigua and Barbuda, Barbados and Saint Kitts and Nevis decriminalised same-sex acts. I am delighted to report that in 2023 the Cook Islands, Mauritius and Singapore joined their ranks.
Same-sex marriage was legalised in the last 12 months in Andorra, Slovenia and Estonia. Same-sex civil unions have been proposed or passed in Latvia, Poland, Czechia, Hong Kong and parts of Japan. Conversion therapy bans have been proposed or passed in Portugal, Norway, Tasmania in Australia, Switzerland and the Netherlands. Other laws to improve the lives of LGBT+ people, such as adoption rights, anti-discrimination laws, advances in the rights of trans people to gender recognition and others, have been passed in places such as New Zealand, Colombia, Australia, Mexico, Cuba, Taiwan, Paraguay, Thailand, Iceland, Georgia, Italy, Cyprus, Germany, South Korea, Pakistan and more.
There is much to be positive about and we welcome that progress around that world. However, a point that has been made by colleagues in other debates is worth repeating: we cannot take progress for granted. We cannot assume that the hard-fought rights and freedoms that we have managed to achieve, in not only the countries I mentioned but the UK, are set in stone and that there is no chance of them ever being reversed. In this House we have spoken about some of the disgraceful measures taken around the world to row back on the rights of LGBT+ people, such as Uganda’s Anti-Homosexuality Act, with other African nations such as Ghana looking worryingly close to doing the same.
In fact, anti-LGBT+ laws have been passed or proposed in countries such as Bulgaria, Bahrain, Russia, Belarus, Niger, Nigeria, Puerto Rico, Kenya, Hungary, Iraq, Lebanon, Malaysia, Oman, Jordan and Burkina Faso. There have also been worrying developments in countries where we would assume that things were only heading forward, particularly in Italy and Spain, and a huge swathe of state-level anti-LGBT laws in the USA.
LGBT+ rights have become increasingly politicised, and we can see that happening in the UK as well. Of course, we have made incredible progress and I always want to champion that. In the last decade alone, we can talk about the successes of same-sex marriage, becoming a leading country in eradicating new HIV transmissions, LGBT content in relationships, sex and health education, and more. There is still a lot to do, however, and I am afraid my right hon. Friend the Minister will not be surprised to hear me speak mainly about the need to make progress with banning conversion therapy.
I was incredibly disappointed that last week we did not manage to persuade the Government or the House to allow a very compromised Bill—so well compromised, in fact, that it was not necessarily universally welcomed by the LGBT+ community. Yet the fact that it was not even allowed to go to Committee stage so we could thrash out some of the challenges and finally make progress towards banning such abhorrent practices was disappointing indeed.
Olivia Blake (Sheffield, Hallam) (Lab)
Does the hon. Gentleman agree with me that it is disappointing that the UK did not feature on any of the lists he mentioned, apart from the last one, obviously? Would it not be good, since we have a whole history month, for the Government to come back to the table quickly with a conversion therapy Bill?
Elliot Colburn
I could not agree more with the hon. Lady. The Bill we were debating last week was the product of extensive hard work and compromise, including meeting people who were both sceptical and incredibly pro banning the practices. The Bill attracted criticism from those in favour of a ban because, unlike in other countries such as Norway, it does not carry a jail sentence. None the less, it was an attempt to try and bring everyone together, take the heat out of the debate and allow us to finally make some progress. That did not happen; the Government were not keen to support it and it was talked out.
Dame Angela Eagle (Wallasey) (Lab)
The hon. Gentleman and I both attended the debate last Friday. Was he as disappointed as I was that, despite how modest the Bill was and how reasonable it attempted to be, some of the arguments against it were so unreasonable?
Elliot Colburn
I agree with the hon. Lady and my co-chair of the APPG. She is absolutely right and I think it demonstrates that, sadly, no matter how much engagement and how much compromise is made, there will be those who are not interested in banning such practices. They do not see a ban as necessary; in fact, they are against it because they believe it will infringe on certain rights. I do not believe that argument for one minute. The only thing that banning conversion practices achieves is to stop people being subjected to harm—harm that is still legal here in the United Kingdom. That is why we have to continue with progress towards a ban.
There have been so many promises since the proposal was first made by the LGBT action plan in 2018 and yet, we have still not had sight of a Bill. We are often told it is complicated. No one is saying it is not, but we delivered Brexit faster than this and I argue that that was slightly more complex. Also, we are not working from a blank slate; there are many other examples from around the world where this kind of legislation has been successfully enacted and has not had the chilling effect that we are often warned about in terms of infringements on the freedom of speech and the rights of women, for example. That just simply has not happened in any example that I have looked at globally where such a ban has already been passed.
We have had ample time to bring forward a Bill. It has been promised in two Queen’s Speeches and at the Dispatch Box and yet there always seems to be a new reason to delay. The latest is that we are now waiting for the outcome of Dr Cass’s review into child and adolescent healthcare when it comes to treating people who are trans. However, Dr Cass has explicitly stated that her work should not be used as an excuse to delay passing a ban, and I argue that we must not delay any longer. We cannot go into an election without passing such a ban because it would represent a huge breach of trust. I feel slightly unfair targeting the Minister with this, because I know how supportive he is on this issue, but I sincerely hope he can pass the message back to those who might be less so to urge them to get on with it.
I worry that this issue has become part of a wider targeting of the LGBT+ community, particularly the trans community, on which there is an increasing focus, alongside the erosion of protections in law. I worry that this is not just the beginning; I am very concerned, as I am sure many of us are, that the targeting of LGBT+ people and the attempt to erode their rights is the first step on a journey to erode many of our hard-fought rights, not just for LGBT+ people, but for many people across the UK. We are seen as a convenient battering ram at the moment.
I hope that we can come together to continue to fight the erosion of our rights. It is a fight that LGBT+ people did not ask for, and we want no part in. I hope that, in this election year, parties can commit to not using these issues as wedge issues, and that they can instead focus on the issues that actually matter to people. Otherwise, I fear that once the election has come and gone, we will be back here again asking for the same thing. As much as I love seeing the Minister and spending time with him, maybe we can cross out this date in our diary for next year. I would like us to make some progress so that we do not need to bother him again, and repeat ourselves.
I end on a happy note: I hope that everyone had a happy LGBT+ History Month.
Graham Stringer (in the Chair)
Hon. Members who wish to speak should stand to indicate that wish, in the usual manner. I call Dame Angela Eagle.
Dame Angela Eagle (Wallasey) (Lab)
It is a pleasure to serve under your chairmanship, Mr Stringer, in a room that is, for once, warmer than it is outside. Clearly, something is working better than it used to.
Today’s debate comes after LGBT History Month, due to, I think, logjams in Back-Bench business. It is an opportunity to celebrate the many events that have happened in the last month, in schools, libraries, pubs, clubs and across our country. LGBT History Month is a huge, ongoing event that has many different facets across the country.
It is also a time for us to remember our past, when we were, as my co-chair of the APPG on global LGBT+ rights, the hon. Member for Carshalton and Wallington (Elliot Colburn), has said, more hidden than we are now; to celebrate the present and the progress that we have made; and for us to be clear-eyed about some of the potential problems we may face in the future.
Marsha De Cordova (Battersea) (Lab)
As my hon. Friend highlights, LGBT History Month was last month. Its theme was paying tribute to contributions in the field of medicine and healthcare. She may be aware that the Mayor of London recently named one of the overground lines that goes through my Battersea constituency Mildmay, after the hospital that played a pivotal role in healthcare for those suffering in the HIV and AIDs epidemic, which in fact became Europe’s first hospice for caring for people with AIDs-related illnesses. Does she agree with me that it is right to recognise our history and the progress being made, but also highlight the fight for equality and justice going forward?
Graham Stringer (in the Chair)
Order. I remind hon. Members that we are not pushed for time this afternoon. Interventions should be short and to the point.
Dame Angela Eagle
It is a great luxury not to be pushed for time these days in the House and, Mr Stringer, you tempt me; but let us see how we get on.
I particularly welcomed the Mayor of London’s announcement about the renaming of the overland train lines after what I think are progressive causes, one of which my hon. Friend the Member for Battersea (Marsha De Cordova) just mentioned, and a pretty fantastic football team—even if they have to keep proving themselves over and over again.
As I was saying, this is a time to remember the past but also to be clear-eyed about some of the potential problems that face us, as a global LGBT community as well as a community in this country. This debate gives us a chance to do that. LGBT+ History Month 2024 celebrated the community contributions to medicine and healthcare, as my hon. Friend said in her intervention. It also highlighted the community’s blighted history in getting access to healthcare, as well as the ignorance, prejudice and inequality that came about as the AIDS pandemic—which is a pandemic and has killed millions of people—raged around the world. All that we got was prejudice and ignorance, and the only thing that helped to make any progress in those grim times was the self- help that the community came together to provide in very many inspirational ways.
Hopefully, we are in more enlightened times now, although I have to say that I have heard similar arguments about the threat that LGBT people present resurfacing again in political discourse. It happens more abroad than here, but it rears its ugly head on occasion here, too. That is an alarm bell that we should all be listening to. We should all be ready to fight because, as my hon. Friend said, a battle for equal rights and equality in the law or for equal access to goods and services, and being able to live a life that is not blighted by prejudice, ignorance or the fact that one is a particular thing—be it black, Asian and minority ethnic, be it a member of a particular faith, or be it LGBT—is all really important. When we fight together to improve the prospects of everyone who might be subjected to discrimination, we create a better, fairer and more equal society in which people’s human rights are properly recognised and prejudice is pushed to the sides.
LGBT History Month is really all about remembering. It is also, I think, about teaching some of the younger members of our community, who breeze through life, never had to be in the closet and have never been subjected to the quite extraordinary vitriol that used to be a regular feature of the media in the 1980s. They do not really understand how far we have come and what gains had to be fought for and made. They take it all for granted, which is fantastic—I hope that they can continue to take it for granted—but I always think that if we do not know our history, there is an increased chance that we will have to repeat it.
It is, then, an important time to reflect on the huge legislative progress that we have made in campaigning for our rights and against prejudice—the kind of progress that I thought was probably unimaginable when I was marching against section 28 in the 1980s. Some of us are old enough to remember Margaret Thatcher’s conference speech in 1987. I used to watch all the conferences, including the TUC’s—they were all televised, constantly, at the time. I was a bit of a junkie when it came to seeing what was happening, and I remember watching the speech in which she declaimed that children were being
“cheated of a sound start in life”
due to the fact that they were
“taught that they have an inalienable right to be gay.”
It is not about a right to be gay; it is about being what you are and being able to live a life that is authentic to what you are, not having to hide away or be berated for who you are, and not being frightened to walk the streets.
Some of us who are old enough do remember the prejudice-laden tabloid coverage and the bullying that that involved, as well as the weaponisation of prejudice for electoral purposes that led to the enactment of section 28, which made the lives of LGBT+ pupils and teachers in schools a misery for generations. Gradually, though, in the face of often open media hostility, the last Labour Government changed all that in a series of landmark changes to the legal statutes that created circumstances in which, largely, LGBT+ people got their equal rights in law.
Many of those changes were hard fought for, including the Sexual Offences (Amendment) Act 2000, which reduced the age of consent for gay and bisexual men to 16. We had to put that legislation through Parliament three times and use the Parliament Act to get it on to the statute book, because the Lords simply would not pass it. Because we persisted with it, we were then accused on the front pages of the tabloids of being obsessed with buggery. Everything is created to make it look like you are the obsessive—the one who is trying always to go on about these things. There is no understanding that, actually, this is just a basic equality requirement that has to be there in law, otherwise that person will be discriminated against, regarded differently and treated differently. The world has not come to an end since we equalised the age of consent, despite some of the warnings, but it really had to be pushed.
Similarly, many here will remember the 2003 repeal of section 28, which talked about “pretended” family relationships and ridiculed LGBT people and their relationships and commitments to each other at a time when people could not get married or do any of the legal things that are available now. That legislation took us three years of persistence to finally repeal because the Lords would not pass it. Every time we were nearly losing our local government Bills, which had increasingly important things in them, we had to keep leaving the change out and putting it in again. It took three years to get that sorted out.
The landmark Gender Recognition Act 2004 enabled transgender adults to achieve legal recognition in their acquired gender. That was because of important international court judgments that basically said they had a right to that. I suspect that the fact that the Gender Recognition Act has been on the statute book for 20 years has passed by quite a lot of people who have suddenly discovered that they are worried by transgender people. The fact is that transgender people were not really visible at all until after the Act was passed. It is an example of how our society gets kinder and more equal if people feel that they can present as they really are. That is what transgender people have been doing since then, until, for various reasons, that has become problematised in the last few years.
As well as that Act being put on the statute book, we had the Civil Partnership Act 2004, which established a new legal relationship for same-sex couples. Some people say that that was then upgraded, but I do not because I still have a civil partnership. I have not got married yet, partially because the Catholic Church does not recognise same-sex marriages and my partner will not do it anywhere else. It is important that we have recognised that civil partnerships can also apply to heterosexual people, because many worry about the baggage that comes with the chattelisation of women in a marriage. I know many feminists who felt that way, and are more than happy to have a civil partnership rather than a marriage in that sense. We are creating circumstances in society in which people’s loving relationships can be recognised, validated and made sound in law so that there is not a problem if somebody dies, is ill or needs to have an official connection as next of kin. That is really important.
The Equality Act 2010 included sexual orientation and gender reassignment as two of the nine protected characteristics. I think it is a pretty good Act. I know that various people have problems with it at the moment, but I think it is a well-balanced piece of legislation that does not need change. The Marriage (Same Sex Couples) Act 2013 legalised same-sex marriages at a time when the party of the hon. Member for Carshalton and Wallington realised that it had got a bit left behind and that it ought to come into the modern world. The vast majority of them are still there, but not all of them, it seems, as we saw last Friday.
All that change was thanks to having a progressive majority Labour Government in the 1997 to 2010 period. We passed progressive legislation that made people’s lives easier and demonstrated that their relationships, their loves and what they did in their lives was properly respected. However, the progress has not been linear—progress very rarely is—and the community faces threats now that are reminiscent of what I hoped we had left behind in the 1980s. For four consecutive years, between 2015 and 2019, Britain was ranked the best place to be LGBTQ+ in Europe, in the Rainbow Europe index, but we are now 17th. There has been a cocktail of anti-LGBT hate crime on the streets, and anti-LGBT diatribes have featured increasingly in the media and some political discourse. Some members of the Government are trying to use that for their own purposes, when it comes to modernising and reform. I am not pointing the finger at anyone in this Chamber, because I know we are among friends, but there are some issues.
Police-recorded hate crime on the basis of sexual orientation is up 112% in the past five years, and against trans people it is up 186%. In Merseyside, where my constituency of Wallasey is, reported hate crime based on sexual orientation is up 162%, and against trans people it is up 1,033%. So let nobody say that the problematising of LGBT people, particularly trans people, does not have consequences on the street, because it does and they are often very brutal.
We need to try to marginalise the people who think that a divisive war on woke is the way they can win the next election, shore up the blue wall or do any of the things they think they are doing by problematising trans people in particular and painting them as a threat. They think what happens on social media is real, and that those provocations are anything other than that—they are often generated by bots and agents provocateurs outside our country in order to divide us. It is called hybrid war, and it is not something we should indulge in.
I am disappointed—I hope the Minister might be able to cheer me up—that the Conservative Government dropped their LGBT+ action plan and dismissed their LGBT+ advisory board. Having such voices at the centre of where policy is made is always very important. The Minister for Women and Equalities, the right hon. Member for Saffron Walden (Kemi Badenoch), has not seen any LGBT+ organisations except those that are gender critical in any of the meetings she has had when she has been formulating Government policy. That is, to say the least, regrettable.
The problems around modernising the Gender Recognition Act and the manifesto promise to ban the abusive practices of conversion therapy need not have happened, but we are where we are and we have to find a way through. There has been an authoritarian far-right backlash evident across the world, encompassing President Putin all the way to Steve Bannon, Trump’s guru, and a lot in between. We need to see what is going on globally and connect it to how the trans issue has been used as a wedge issue in order to take the “T” out of LGBT and destroy progress in this area.
Just last week hon. Members were lining up to stop a very mild private Member’s Bill. It was so mild that I wanted it to be toughened up considerably, were it ever to reach Committee stage. But we could not even get it there, nor would the Government even allow opinions on it, despite the sponsor bending over backwards to try to create a situation where the Bill could get to Committee. We have had Members of Parliament talk about LGB people, erasing the “T”, and equating conversion practices with families having a normal conversation about their children growing up and exploring ideas about themselves and their identity. That is not what conversion practice is. It is easy to recognise torture and abuse when we see it. Torture and abuse is definitely not a conversation.
This year, whether the Prime Minister likes it or not, there will be a general election. Labour will offer the country the chance to pick up on legislating to protect the LBGT community with a comprehensive, trans-inclusive ban on conversion therapy. I would have liked to get it done sooner, but it will happen. We just have to make progress. It is very sad that, as the hon. Member for Carshalton and Wallington said, it has taken longer than the Brexit negotiations. That should make us stop and think about what has been going on. We will also strengthen the law so that anti-LGBT+ hate crimes are treated as aggravated offences, and there will be a much-needed modernisation of gender recognition processes, which are humiliating and overlong.
Progress on LGBT rights around the world was summed up very well by the hon. Member for Carshalton and Wallington. There are still 67 countries that criminalise homosexuality, 51 that restrict freedom of sexual and gender expression and 11 that apply the death penalty for same-sex offences. Uganda and Ghana have passed the two most recent pieces of anti-LGBT legislation that feature capital punishment. Just last week, Ghana passed its Promotion of Proper Human Sexual Rights and Ghanaian Family Values Bill unanimously. Even thinking about the title, there are a whole load of assumptions in there that are interesting to say the least.
That Bill criminalises being gay, prohibits adoption for gay people and forcibly disbands all LGBT associations. For same-sex intercourse, one is likely to be jailed for up to three years. For producing, procuring or distributing material deemed to be promoting LBGT activities, it is six to 10 years. For teaching children about LGBT activities, it is also six to 10 years. Just yesterday, on Ghana’s independence day, LGBT+ protestors demonstrated in solidarity outside Ghana’s high commission against this appalling Bill.
Uganda’s Anti-Homosexuality Act passed last year. It includes the death penalty for the offence of “aggravated homosexuality”—whatever that is—life imprisonment for the offence of homosexuality and up to 20 years in jail for promoting homosexuality. A report was compiled late last year by the Strategic Response Team, which is a coalition of Ugandan LGBT+ rights organisations, which have been criminalised for even existing in their own country and have to operate in very difficult circumstances. They found that between May, when the Act became law, and September there had been 180 cases of evictions, 176 cases of torture, abuse and degrading treatment, and 159 incidents of discrimination.
All of those were against both real and perceived LGBT+ people. We have to remember that just because something is anti-LGBT+ legislation, it does not mean the people caught by it are necessarily LGBT+. They are marginalised or focused on for whatever reason the authorities feel that they wish to focus on them. We have heard that the first person arrested who faces capital punishment under the law was not even gay. They were homeless, and they were arrested for being shirtless, which was because they were poor, and they were charged under the legislation. The Ugandan authorities are using the law to brutally criminalise the LGBT+ community, but also to go for any marginalised groups they want to attack. It is one of those catch-all things that they can put people in jail for. As is often the case, an attack on one minority is only ever the beginning of attacks on many others.
On our own European shores, over a fifth of countries lack broad protections for LGBT+ people—again, mentioned by my friend the hon. Member for Carshalton and Wallington. Discussions in schools on LGBT+ issues are outlawed in Russia, as is being LGBT+, and in Hungary, Lithuania and Latvia. In Poland, nearly 100 municipalities have self-declared as LGBT-free zones. I hope that President Tusk, who—thank goodness—has just been elected in Poland, can start to undo some of the damage done in this area by the previous long-standing regime.
Across the Atlantic, the American Civil Liberties Union is tracking 474 anti-LGBTQ Bills in state legislatures across the country. That was the number as of yesterday, but it is probably out of date already because several get promulgated every day. Florida’s so-called “Don’t say gay” law bans discussion on sexual orientation or gender identity in schools for children under 10—that is their very own section 28. That is being exported by American Christian groups, which ploughed more than $280 million into campaigning against LGBT+ rights and abortion rights worldwide between 2007 and 2020, targeting communities and Parliaments around the world with their well-funded and co-ordinated doctrine of hate.
The legislation in Uganda and Ghana is peculiarly similar because it was drafted in that context. That does not arise spontaneously; it is well organised, and it has to be fought. Britain, as a country that respects international human rights and has better standards on that, ought to be financing some of the battles to prevent the spread of that pernicious and damaging ideology.
Britain has to get back on the international stage to advance LGBT rights across the globe and has to support those campaigning to change those unacceptable laws at home. I know that the international development Minister, the right hon. Member for Sutton Coldfield (Mr Mitchell), is very aware of that, and we as an APPG have been to see him about it. It would be interesting if the Minister said a bit about whether there is funding to help to support a battle against those worrying developments on the African continent.
We have made progress, stalled and progressed again, and are going forwards and backwards in a non-linear way. There are challenges ahead, but we have to redouble our efforts not only to be proud of who we are and proud of our communities, but to try to create a circumstance where once more Britain leads the world in LGBT+ rights.
Stephen Doughty (Cardiff South and Penarth) (Lab/Co-op)
It is a pleasure to serve under your chairpersonship, Mr Stringer, and to follow two excellent speeches by the hon. Member for Carshalton and Wallington (Elliot Colburn) and my hon. Friend the Member for Wallasey (Dame Angela Eagle). They have said many things that I agree with. I will touch on a few of those things but will also cover some other areas.
I join everybody else in belatedly wishing everyone a happy LGBT+ History Month. It is important, and I want particularly to thank the individuals who set this up many years ago. It allows us to reflect on where we were, where we are, and where we have to go. It also enables us to look at aspects of the LGBT+ history of this country and the globe. I declare my interest as a member of the all-party parliamentary group on global LGBT+ rights and as co-chair of the LGBT+ parliamentary Labour party group with my hon. Friend the Member for Wallasey, who is sitting next to me.
It is worth reflecting on the hard evidence of how far we have come in a positive direction. The latest British Social Attitudes Survey report came out in September last year, and it details many of the positive changes in attitudes of the last 40 years. In 1983, only 17% of people believed that same-sex relations were “not wrong at all”; that is 67% today. The proportion of those who said that same-sex relations were “always wrong” has fallen from 50%—half of the population—to just 9% today. That is still far too high and amounts to nearly one in 10 people, but it shows the progress we have made as a result of campaigners, activism, Governments taking leadership and decisions on these issues, and change within organisations that have previously been extraordinarily conservative themselves, including in parts of many faith communities. I say that as a Christian. There has been huge changes within the Church—again, it still does not go far enough for my liking, but there has certainly been a lot of progress. We have many more inclusive places of worship and places of faith across this country than we did in the 1980s, for example.
However, it is also important to reflect on the negatives and where we are actually going backwards. That same survey showed that, since 2019, the proportion of people who described themselves as
“not at all prejudiced against transgender people”
has fallen from 82% to 64%. That is just since 2019—in the last five years. That is quite a rapid decline in support for, and awareness and acceptance of, those with transgender and non-binary identities. It should be a wake-up call and a worrying call to us all to see such positive changes in some aspects of rights but such backsliding on others in just a few years. The reasons why that has happened in this country, but not in all countries across Europe or the globe, have already been accurately reflected on. These changes are happening for a reason. Many of us have touched on it in debates in this place before. It is deeply concerning and worrying, not least when it is combined with hate crime statistics and the very sharp, violent and in some cases tragically life-ending circumstances that we have heard debated in this place in recent weeks.
I do not say this as any reflection on the two Conservative Members present, the hon. Member for Carshalton and Wallington and the right hon. Member for Pudsey (Stuart Andrew), because I know that they are very strong advocates and have spoken out bravely against challenges in their own party over recent years, but I will always look back. I have a poster on my phone that somebody once sent to me. It was issued by Conservative central office in Smith Square in the 1980s. At the top, it says, “Labour Camp”, and it depicts people holding up banners in the street, reading “Gay Sports Day” and “Gay Lib”, followed by:
“Do you want to live in it? Think about it. Conservative.”
It was published privately by central office—the headquarters of the party, not by some activist or individual—in the 1980s. I know that is not the party as it is today, and I sincerely hope that it would never publish that sort of material in the future. It certainly would not be approved by the Members in this room from the party, but I worry about the language and divisive rhetoric of those who are perhaps auditioning to be a future Conservative leader or seeking to take their party in a very different direction.
One of the hallmarks of the work of the APPG on global LGBT+ rights and of many of the forums in this place and in our parties is our unity on basic principles of human rights, equality, and inclusion, regardless of huge divisions on other matters relating to the running of the country. There is unity on the fact that we should not have that kind of division, language and problematisation of minority populations in this country. I know that the two Conservatives here do not take that approach. They believe in an inclusive and open party, but it is a big problem to hear senior figures saying some of the things they have done in recent weeks. In our party, we know all too well that when things are being done and said that are completely unacceptable, it takes bravery and courage to speak up and stand up and be counted when it matters—even when that is on somebody’s own side. I certainly hope we will see a pushback against that kind of language. We do not want to go back to those days when Conservative party headquarters was putting out material like that.
I would like to reflect a little on my own constituency and some of the fantastic organisations and groups, not only in Cardiff South and Penarth, but across Cardiff and the Vale of Glamorgan. They are testament to our current vibrant LGBT+-inclusive communities and have been key to shifts and changes in social attitudes and behaviours in recent years. I think particularly of Pride Cymru, which organises our annual Pride parade in Cardiff, and our local Prides. Over the last few years, I have been able to attend a number of local Prides in Wales. They simply would not have happened when I was a young person growing up, completely repressed and closeted in south Wales. Llantwit Major, where I went to school—a town in the neighbouring constituency of Vale of Glamorgan—held its own Pride a little while ago. There was even an LGBT flag flying from the church. I literally could not have believed that as a child growing up in that town.
I was also proud to march alongside many others at Barry Pride. I went along to Newport Pride; again, that would have been unthinkable a few decades ago. And we all come together for the national celebration in Cardiff. I really pay tribute to all the volunteers and organisers who do such incredible work with Pride Cymru. It draws on the history from the early days of the Mardi Gras in Cardiff, right through to what we see today, which is vibrant, inclusive to all people, all ethnicities, all races, all religions, all ages—it is a festival of inclusivity. It is a lot of fun, with great music—a great day out for all. Those festivals and coming togethers have been key and are indicative of the progress that has been made.
I also want to pay tribute to the key figures of the LGBT+ community, some of whom have great historical knowledge and perspective. There are two I want to mention today. The first is my very good friend and neighbour— I declare an interest, because she sometimes feeds my cat—the wonderful Lisa Power, who was one of the original founders of Stonewall, an original operator on the LGBT+ Switchboard and a former director of policy at the Terrence Higgins Trust. She is also a historian of the LGBT rights movement in the UK and has written some fantastic books and articles. She has been part of a team researching LGBT+ history and lost venues and locations in Cardiff and Wales. It is fantastic to be able to see how that heritage has developed over time.
Russell T. Davies is also a key figure on the scene, not only for his work on “Doctor Who” and other leading series, but, critically, his work on the series “It’s a Sin”, which showed very powerfully a few years ago the remarkable struggles of those who were involved in HIV campaigning and wider LGBT+ campaigning, which was so critical in the 1980s, and the tragic circumstances that many went through. It is by getting those stories to the screen and reminding people what happened that we can achieve progress going forward. Those are just two key people I wanted to mention from our local community.
Today, we see Cardiff and Vale of Glamorgan as a hub of excellent TV and film production, including queer and LGBT-inclusive TV and film production. I think particularly of “Doctor Who”—filmed in my own constituency, with BBC Studios, Bad Wolf and now Disney+ —which has always had an inclusive approach to LGBT+ characters. In recent times, it was a real pleasure to join Ncuti Gatwa at the premiere with the BBC just before Christmas—many MPs went along to that fantastic event. There is also the famous series “Sex Education” on Netflix, which is filmed largely in my constituency. It is a hugely popular worldwide hit and is rooted in Cardiff and the Vale of Glamorgan; some of it is also filmed in Newport.
I want to pay tribute to some of our incredible local venues. I mentioned the lost venues, but we are very lucky to have so many vibrant venues in Cardiff, with new ones opening up. Recently, we had a new venue open, the Dock Feeder, just down from the new canal in Cardiff, which is an uncovering of the old Dock Feeder canal. We are trying to do something similar to Manchester, although not quite on that scale. It is really positive to see. There are venues like the Golden Cross—I declare an interest as a regular visitor; there is Mary’s, Pulse and so many others. These venues are the lifeblood of our LGBT+ communities. It is important that we recognise the role that venues have played in providing safe spaces and places not only for expression but for bringing together LGBT+ communities, particularly in the past when being a member of those communities could have landed someone in a lot of trouble, or worse. Those venues still play a crucial role and it is important that we protect and recognise them as safe and welcoming spaces for the LGBT+ community.
I think of places such as the Queer Emporium in the centre of Cardiff, which provides an awful lot of material and clothing and which is, again, a safe place for people to meet. Also, we have the wonderful LGBT+ societies at our universities in Cardiff, organisations such as Glitter Cymru, those that work with black and minority ethnic communities in particular and the work done by specific organisations on issues not only affecting the LGBT+ community but more broadly, such as Fast Track Cymru, which is doing work to end HIV transmissions and wider work around sexual health in south Wales. I wanted to touch on some of those because it is important we recognise and celebrate not only what all those organisations have done in the past but what they are doing today.
I will now come to some of the issues already covered by my hon. Friends. On conversion therapy, I share the sadness, concern and disappointment at the failure of the very reasonable Bill put forward by my hon. Friend the Member for Brighton, Kemptown (Lloyd Russell-Moyle) to progress through the House and some of the quite divisive and unhelpful speeches heard during the debate. Conversion therapy is abuse, and it is a vile and abhorrent practice. I have met survivors of conversion therapy and know what damage it has done to them. I do not want to name individuals, but there have been really harmful mental health impacts, such as self-harm and suicidal thoughts, and the lifelong impact of forcing someone to try and deny who they are.
The practice needs to be stamped out. It is hugely disappointing that the Government have not moved on the matter and I hope the Minister can say a little bit on that when he gets up. It was deeply disappointing that the House did not allow that reasonable Bill to make progress. However, I am pleased that if a Labour Government were elected, we have made clear that we would implement a fully inclusive ban on conversion therapy in all its forms. It is crucial we do that sooner rather than later and I am astonished that the practice still goes on in this country in 2024. It needs to be ended.
We have already talked a little about hate crime. I led a debate in this place just a few months ago on the subject and we have heard some of the statistics. It was deeply disappointing that the Minister at the time used the word “hysterical” in referring to some of the comments made in the debate. Hon. Members from all parties had spoken up against hate crime in a non-partisan way, telling real stories that had affected their constituents and other people up and down the country, and the statistics bear that out. To then have that slightly dismissive response from a Minister was deeply disappointing—it was not the Minister who is here today. I hope he can reassure us that that is not the position of the Government and that they take hate crime seriously.
As has been reported, we have seen a 11% increase in hate crimes against trans people in just a year, a 186% increase in the last five years and although there was a slight fall in crimes against people on the basis of their sexuality last year, that is masked by a 112% increase in hate crimes in the last five years. Again, I am sorry to have to declare an interest, but I too have been victim of an aspect of homophobic assault in my constituency. I have also experienced online and other abuse, as I am sure many other hon. Members have. It is a sad fact that these days, particularly for those of us in public life or in the public eye more generally—I think of people in all lines of work, such as journalists, public officials and others—if someone is a woman, if they are black, if they are brown, if they are Jewish, if they are Muslim, if they are gay, if they are trans, if they are lesbian, the reality is that they will face a substantially higher level of abuse and, I am afraid to say, risk as a result of their work. That has to end; it has to stop. Frankly, social media companies and others need to do a lot more to crack down on the matter, but unfortunately, it is being fuelled by the divisive rhetoric and language being used by some in senior public positions. That has a real-world effect on the ground.
We also know from the Government’s own reporting that they believe there is significant under-reporting and fewer than one in 10 people who are victims of hate crime in that way are actually reporting it. I know that my own police force in south Wales takes these matters very seriously, and I commend it on its work in this area. It does not get everything right, but it has certainly been active and proactive on the issues. However, that is not the case in all parts of the UK. Trust levels in the police in some parts of the country are not what they should be, not least in the Metropolitan police. After some of the incidents in the past, we all know why that might be.
I do not want to go into this too much, because of my shadow Front-Bench role, but the global statistics on LGBT+ issues are of grave concern, not only in relation to the UK, which, as has been said, has fallen from first to 17th in the Rainbow ranking since 2015, but because of what we see in a number of countries across Europe, Africa and globally. That is before we mention places such as Russia, China and so on.
I share the great alarm at some of the recent developments that we have seen, particularly in countries in Africa. There are real questions to be asked, if those worst fears are realised in due course, about the terrifying impact that that will have on citizens in those countries. People will also ask serious questions about trade and investment. Businesses will be asking questions about where they choose to trade with, the sorts of relationships that they choose to have and the safety and security of staff, tourists, others and even Members of this House; I have travelled to one of those countries as part of a delegation. I would certainly think carefully about my involvement in such a visit in the future if I thought that I would be penalised for being who I am, at risk of jail or worse.
There are serious questions that need to be considered. I certainly hope that those things do not come to pass in the way that they have been travelling at the moment and that those countries will think again. However, our primary concern must be for those who, just like in this country, exist and have always existed; they should not be criminalised or subject to the types of abuse and punishment that they face. We need to ensure that we always listen to those activists about the best ways in which we can work with, assist and empower them to go forward and have their circumstances heard.
As I said, there are deep concerns in a number of countries across Europe as well. I engage regularly in these matters. Indeed, we have seen many of our UK overseas territories move forward in areas of inclusion and equality over the years. However, there are some discrepancies, particularly with regard to equal marriage, civil partnerships and other rights for LGBT+ individuals. I believe firmly in the autonomy of, and devolution of responsibility to, our overseas territories, but being part of the British family comes with responsibilities, which include the upholding of basic human rights and equalities.
I will end by saying, as others have, that we see worrying backsliding. Progress clearly cannot be taken for granted. We have only to look at the powerful book written by my hon. Friend the Member for Rhondda (Sir Chris Bryant) about the experiences of secretly gay Members of this House in the relatively—for the time—permissive environment of Berlin in the 1930s, which changed subsequently and dramatically. That ended with LGBT people alongside 6 million Jews, Roma, Gypsies and others being taken to concentration camps. I am not suggesting that we are suddenly on the brink of that in this country, but we must all learn from those terrible examples in history where progress, open-mindedness and inclusivity seemed to be on the way, but were closed down suddenly and rapidly. We have seen that happen in a number of other countries.
We still have far too much to do in this country and, indeed, even in this place. I am pretty sure that if I asked to be married in a same-sex wedding in the Chapel of St Mary Undercroft, I would not be permitted to do so, because it is an Anglican church. I might be lucky and be able to get a blessing now, but that is direct discrimination in this building against Members of this House. I took the young son of a friend on a tour recently. I took them into the beautiful Chapel of St Mary Undercroft and explained that, and the child said, “The Church is mean”. I said, “I am afraid it is on this”—I say that as a member of the Church. The reality is that unless we see progress in all our institutions and all parts of society to fully respect and include every member of society, regardless of their sexuality, gender identity or other protected characteristics, then we still have a very long way to go.
I am very proud that our party has set out a number of key commitments were we to form the next Government. We saw a radical reforming Labour Government in 1997 in this area that made huge changes, whether that was on section 28, civil partnerships or the GRA. I am pleased by what my colleagues have set out regarding GRA modernisation, a ban on conversion therapy, and aggravated offences on hate crime. I am pleased by what my Labour colleagues in Wales have done on an inclusive curriculum, an LGBT+ action plan, and clear commitments to all of the community. That is the sort of society that we need to build—a society where everybody can be who they want, and one where we can all be who we want to be in this House too. That is why moments like LGBT History Month are so important.
Olivia Blake (Sheffield, Hallam) (Lab)
I thank my glass ceiling-smashing hon. Friend the Member for Wallasey (Dame Angela Eagle) and the hon. Member for Carshalton and Wallington (Elliot Colburn) for calling this important debate, and for being visible and an inspiration to young LGBT+ people across the UK. I was happy to support it when it was proposed as a Backbench Business debate, and I thank the Committee for allowing us time to discuss this important issue. It is important that we continue to make LGBTQ+ people and the issues that affect us visible, and that we continue trying to build a world where we are not only tolerated but celebrated for who we are. That seems truer now than it has in a long time.
I am married to a Roman historian, so I could bore everyone senseless on the LGBTQ+ history going back to Roman times and much further, but I will not. Instead, I will focus on my short life instead. I was born in March 1990, three years after the parliamentary debate on section 28. In the decade before I was born, attitudes to LGBT+ people had shifted dramatically. In 1983, as my hon. Friend the Member for Cardiff South and Penarth (Stephen Doughty) mentioned, 50% of those questioned by the British social attitudes survey believed that sexual relations between two adults of the same sex were always wrong. However, by 1987, that proportion had risen to 64%.
The horrifying truth is that, in the years immediately before I was born, society became less tolerant of LGBTQ+ people. That is frightening, because it shows that attitudes do not automatically become more progressive over time. The shift in opinion did not fall out of the sky; it was driven by the debate on section 28 and a Prime Minister who, as my hon. Friend the Member for Wallasey already mentioned, said that no one had an “inalienable right to be gay”.
In the years that followed my entry into the world, things began to change. While I attended secondary school, when I was 13, section 28 was repealed, and new rights for trans people had been enshrined in law, as has been mentioned. As I grew up in the decade that followed that, I saw a wave of legislation affirming the rights of LGBTQ+ people. I am so proud to be a Member of Parliament for the party that brought in so much of that legislation. It is the accumulation of those things that led me to the firm belief that we absolutely do have an inalienable right to be gay. I am not alone. Where once, 64% of people thought that same-sex relationships were always wrong, now 67% of people believe that they are never wrong.
That is why now is a frightening time for people like me. I grew up under progress, and now for the first time since I have been alive that progress is not only stalling but feels like it is going backwards—and backwards quickly. It was only in 2018 that the then Minister for Women and Equalities, the right hon. Member for Portsmouth North (Penny Mordaunt) told the House that,
“trans women are women and trans men are men.”—[Official Report, 3 July 2018; Vol. 644, c. 184.]
Obviously, things have changed since then, and not for the better. Now we are more likely to hear a joke at the expense of trans people from the Dispatch Box than an affirmation of their identity. Despite the lessons we should have learned from section 28 and the damage that it did, we are still haunted by the premise that some people do not have the inalienable right to be who they are.
That has consequences. As has been mentioned, hate crimes against trans people went up by 11% last year, nearly double those committed in 2010-11. It also has consequences for the wider community. In the previous year, we have seen far-right and fascist pickets outside LGBTQ+ events, and while there has been a reduction in hate crime directed at LGBTQ+ people in the last year, I think that probably has more to do with reporting. If we look back over the past two years, there has been an overall increase of 37.5%, and anecdotally, I know that people are feeling much less safe.
Britain is part of a pattern. Across the United States, we have seen shootings at LGBTQ+ venues, alongside legislative attacks on queer culture and performance spaces. In Poland, anti-LGBTQ+ zones that ban symbols like pride progress flags, which show that a place is safe for queer people, have now been banned, making it harder for people to live freely and in supportive spaces. In Hungary, section 28-style laws that ban the depiction of LGBTQ+ people in culture are causing havoc. In Australia, fascists are marching to strip trans people of their rights. In Italy, Giorgia Meloni’s post-fascist party has banned municipal authorities from registering the children of same-sex couples. How have we got here? Our steps towards progress, both domestically and internationally, are faltering, and we are being pushed backwards.
I also have hope. Three years before I was born, more people than not thought that being gay was morally wrong. Now attitudes have changed. To turn the tide, we must learn the lessons: to support and celebrate people, not force them into the closet; to treat people with dignity and respect, not as objects of fear or ridicule; and, whatever anyone may say, to insist on their inalienable right to be gay, lesbian, bisexual, trans, queer, or every other identity represented by the pride progress flag.
Kirsten Oswald (East Renfrewshire) (SNP)
It is a pleasure to serve under your chairship, Mr Stringer, and I am grateful to the hon. Members for Carshalton and Wallington (Elliot Colburn) and for Wallasey (Dame Angela Eagle) for their leadership in the debate today. It is a pleasure to speak in the annual LGBT+ History Month debate, and to reflect on the journey that has been made and also on where change still needs to come. I welcome the opportunity to speak about the positive progress that we see in a whole range of areas, but as the hon. Member for Carshalton and Wallington pointed out, there is no inevitability about progressive change. We can all see this playing out. We can see the statistics showing hate crimes against LGBT+ people rising, and we need to be prepared here to speak out and to speak up for their rights.
It is quite extraordinary to think that it was only 10 years ago that same-sex couples were allowed to marry, and that only came 10 years after civil partnerships were introduced, which same-sex couple could enter into. It is almost inconceivable that those changes, which I think are so overwhelmingly accepted as part and parcel of partnership and marriage, were made so very recently. I think the hon. Member for Sheffield, Hallam (Olivia Blake) put it very well when she called for us not just to tolerate but to celebrate LGBT+ communities. It is true that we have come a long way in relatively recent times, but we have obviously been playing catch-up because change was well overdue. It is beyond time for further change, such as a ban on conversion practices, which we have heard so much about today. The SNP Scottish Government are very clear on the need to act to end conversion practices and to ensure that everyone, regardless of their identity, is protected from them. That is progress that we need to see all across these islands.
I am very sorry that I was unable to join the hon. Member for Brighton, Kemptown (Lloyd Russell-Moyle) last week in the debate on his private Member’s Bill—the Conversion Therapy (Prohibition) Bill—but I saw enough to think that unfortunately this place did not come away looking particularly good. We need to be able to discuss and listen to others without some of the heat that seems to be inevitable at the moment. Unfortunately, that heat is ramped up to some extent by the U-turning, stopping and starting, and obfuscating on this topic from this Government—not this Minister—and by the desire in some quarters to polarise, demonise or to problematise, as the hon. Member for Wallasey described. It is a clearly a direction of travel that is mirrored and influenced by increasing populism and division across the globe. But we do not need to do those things, and we do not need to accept that direction of travel as inevitable. Nobody benefits from it, and it causes such significant worry and harm to LGBT communities.
That worry exists with good reason when we look at the statistics. Hate crimes based on sexual orientation are reportedly up 112% from five years ago, and hate crimes against trans people are up 186% over that same period. I was struck by what the Law Commission’s hate crime report said about how members of Governments and legislatures across the UK should not engage in “culture war” targeting of the trans community, or use their positions to stir up fear and hostility towards trans people, and that all Governments across the UK should commit to addressing the causes of rising LGBT+ hate crimes. Surely it is difficult to argue with that.
Amidst all this, it is really important that we do our best in this conversation to make sure that young people are provided with constructive and conclusive education. I am always really proud to stand up in this place and talk about the exceptional work that the Time for Inclusive Education campaign has done to deliver that inclusive education in Scottish schools. That is important and welcome to me as a mum, and I know that my views are shared by the vast majority of parents—a recent survey found that 70% of parents support the national LGBT+ inclusive education programme.
I have said before that the current situation is a far cry from my school days, and it was interesting to hear the hon. Member for Cardiff South and Penarth (Stephen Doughty) reflect on his school days. It was admittedly not yesterday that I was at school, but it was really clear to me when I was that no child in my school was LGBT+. I went to a perfectly nice school, but I was at school in the 1980s, when section 28 was big news.
The hon. Member for Wallasey spoke powerfully about the hugely difficult times in the 1980s and the terrible impact they had on people. I, too, looked back to what was being said at that time, and it is very easy to see why people felt that they should keep their identities hidden. Margaret Thatcher said in her 1986 Conservative party conference speech that
“children are being cheated of a sound start in life”
due to
“being taught that they have an inalienable right to be gay.”
It is quite hard to read and say that now. Of course gay people have an inalienable right to be gay—because they are gay. In my school, the truth of course was that many pupils were gay. There were LGBT+ pupils in the school, but they felt they needed to keep that to themselves and move on in their lives, and move on in time, before making that known. We cannot go backwards, to a time when being LGBT+ was some kind of taboo—how can it be taboo to be yourself? I think the attitudes of young people will be instrumental in making sure that that rowing back, which some people would unfortunately like to see, will not happen.
I want to mention someone who is a real inspiration to young people, and to some of us who are a bit older as well—someone who is a change maker and very much to be admired. In September 2022, Zander Murray became the first senior Scottish footballer to come out as gay. He currently plays for Bonnyrigg Rose, a professional club in Scottish League Two, and he is a bit of a goal-scoring machine. He is now the first openly gay player in Scottish football since Justin Fashanu.
Since he has come out, Zander has been really passionate about and committed to being a role model to the sporting community, and to empowering young people—particularly footballers—to be their true authentic selves. That is incredibly powerful and important. To quote Zander:
“Whilst growing up, unfortunately I felt my life in football and my sexuality could not coexist. I felt that I needed to keep it hidden and fight against it for years which resulted in numerous missed opportunities and internal struggle. Fortunately, I am now at peace with myself and more importantly I have found an amazing community that I want to stand up for and be an active ally for. It is now really important that I play my part to ensure no one experiences what I did and that all young LGBT+ people know that football and any other sport is a place where they can thrive.”
That is surely a sentiment that all of us would agree with.
Zander is clearly making a huge difference. He is retiring at the end of this season, and I have no doubt that he will continue to make a positive difference and be a really important voice in this conversation. We all need to engage in that conversation a great deal more—not just the people in this Chamber, who I know do so with good will and enthusiasm at all times. We need a much broader conversation that people such as Zander will be able to inspire others to take part in.
Ashley Dalton (West Lancashire) (Lab)
It is a pleasure to serve under your chairpersonship, Mr Stringer. I congratulate the hon. Member for Carshalton and Wallington (Elliot Colburn) and my right hon. Friend the Member for Wallasey (Dame Angela Eagle) on securing this important debate, and thank them both for their efforts in doing so. [Interruption.] Have I done something wrong?
Ashley Dalton
Oh, I assumed you were! Apologies.
LGBT History Month is an opportunity for us to look back and remember what we have achieved. My hon. Friend the Member for Wallasey highlighted the fact that it is an opportunity to know our history so that we might be less likely to repeat its mistakes, and pointed out that the Government’s LGBT action plan and advisory panel are now things of LGBT history—perhaps not the kind of history we would want. As the hon. Member for Carshalton and Wallington pointed out, LGBT people have been around since time immemorial. We are not new. But we are still debating LGBT rights on at least an annual basis, and we must be ever vigilant about how fragile the rights we do have can be.
LGBT History Month is also an opportunity to reflect on the current state of LGBT+ rights both at home and overseas, and there is much to celebrate. I am delighted that same-sex couples can finally receive at least a blessing from the Church of England. Religion and religious expression is as intrinsic to the identity of some people as sexuality. The fact that same-sex relationships can now be recognised by the Church of England is a long-awaited milestone for the LGBT+ community, and one we all hope will be followed by more progress in this area in the years to come.
I was also pleased that the Government decided last summer to expand the scheme to pardon people who served in the military and were convicted of homosexual activity, including allowing female veterans to wipe their offences from the record. Sexuality is not a crime, as the last Labour Government recognised when they first lifted the ban on LGBT+ people serving in the armed forces in 2000. I am glad that the Government issued an apology to all LGBT+ personnel impacted by the ban. It is a step in the right direction, but we are still waiting for news on the progress of financial reparations and other recommendations in the independent review. Will the Minister provide an update on that today?
In Europe there have been several advancements in LGBT+ rights that are worth highlighting. Greece became the first Orthodox Christian country to legalise same-sex marriage in February, and Latvia will join its neighbour Estonia in legalising same-sex marriage this year. Several European states, including Norway, Portugal, Cyprus, Ireland and Belgium, have achieved what this country has so far failed to do by passing bans on so-called conversion therapy across their nations. It is with much disappointment that I mark LGBT History Month in this House today with no ban on conversion practices on our statute book.
However, the international picture on LGBT+ rights is far more mixed. Across the globe, LGBT+ individuals remain criminalised, persecuted and at risk of death. Last month, Russia began enforcing new legislation criminalising the display of “extremist symbols” such as the pride flag. In Saint Vincent and the Grenadines last month, courts upheld laws criminalising gay sex, while in Uganda, as has been noted, merely identifying as LGBT was criminalised in 2023.
In some nations where the legal system may not directly persecute or diminish the rights of LGBT+ people, societal attitudes may do so. In South Africa, which remains the only nation in Africa where same-sex marriage is legal, 59% of South Africans still oppose same-sex marriage. Similarly, a minority of the Greek public supported gay marriage when polled late last year. Those figures are a stark reminder that although legal progress may have been made, the LGBT+ community continues to face the same or similar attitudes to the ones that once legally prohibited the free expression of our sexuality.
My hon. Friend the Member for Battersea (Marsha De Cordova), who is no longer in her place, raised the recent recognition of Mildmay Mission Hospital in the renaming of London underground lines, and its deep connection with the LGBT community through its provision of services to those affected by HIV and AIDS, particularly at a time when prejudice was rife, even in our NHS.
Last summer marked a decade since same-sex marriage was introduced in this country—a significant moment for the LGBT+ community—but many LGBT+ people will not feel able to celebrate that anniversary, because although it is welcome that anti-LGBT+ hate crimes have fallen 5% over the past year, hate crimes motivated by transphobia have increased by 11% over the same time, and the rate of violent hate crimes targeting all groups has not fallen.
My hon. Friend the Member for Cardiff South and Penarth (Stephen Doughty) mentioned the importance of venues in providing safe places for LGBT people to meet, congregate, socialise, network and build a community. The hon. Member for East Renfrewshire (Kirsten Oswald) highlighted the importance of role models, particularly in sport and popular culture, for young people who are LGBT—and, I would argue, also for those who are not. Too many members of the LGBT+ community still do not feel able to be who they are in public, and hide their identity or sexuality. The statistics on anti-LGBT hate crime do not tell even half the story, because the Government’s own figures acknowledge that 90% of anti-LGBT hate crime goes unreported.
It is the responsibility of us all in this place to make our country a safer place for LGBT+ people. Last week, we had an opportunity in Parliament to start the ball rolling on an inclusive ban on conversion practices. I am glad to see the Minister here for this debate. I know that he has personally been very supportive of a ban, so it was a shame that he could not be in the Chamber last Friday.
My hon. Friend the Member for Cardiff South and Penarth also told us about the large and rapid decrease in people saying they are not prejudiced against trans people. We have to consider how the language and leadership, or lack of it, shown on the Government Benches might contribute to that. My hon. Friend the Member for Sheffield, Hallam (Olivia Blake) reminded us that the shift in public opinion in the late 1980s away from general support to more negative views of LGBT people and same-sex relationships came in the context of the section 28 debate. That is a reminder that progress is not inevitable and that we can go backwards as well as forwards.
It appears that the Government have no immediate plans to bring a ban on conversion practices to the House. Will the Minister tell us whether he supported the Bill last Friday? The Government may choose to sit on their draft conversion therapy Bill for fear of unleashing a Back-Bench rebellion that could bring down the Prime Minister, but Labour has a proud record of leading the way on LGBT+ rights. It was Labour that repealed the appalling section 28; introduced civil partnerships, which paved the way to equal marriage; ended the ban on LGBT+ people serving in our armed forces; equalised the age of consent; gave LGBT+ couples the right to adopt; introduced the Equality Act; made homophobia a hate crime; and brought forward the Gender Recognition Act. That record made our country a safer and more hospitable place for LGBT+ people to grow up, work, love and thrive. The next Labour Government will continue that work.
It is Labour that will legislate to give longer sentences to criminals found guilty of LGBT+-motivated hate crimes, deliver a new deal for workers that tackles the workplace harassment of LGBT+ people, and put a full loophole-free trans-inclusive ban on conversion practices on the statute books. It is Labour that will always treat LGBT+ people fairly and with dignity, respect and, crucially, equality.
The Parliamentary Under-Secretary of State for Culture, Media and Sport (Stuart Andrew)
It is a pleasure to serve under your chairmanship, Mr Stringer. I, too, thank my hon. Friend the Member for Carshalton and Wallington (Elliot Colburn) and the hon. Member for Wallasey (Dame Angela Eagle) for securing the debate, which is an important one for so many reasons. For too long, the history of LGBT people’s lives, their stories and their love were hidden. The achievements of people, including the advancements and breakthroughs that they made, were recorded but never acknowledged or celebrated, simply because they were LGBT.
We have had some really thoughtful contributions this afternoon. In opening the debate, my hon. Friend the Member for Carshalton and Wallington rightly talked about the international changes that have happened —some good; some really very worrying indeed—and how we cannot take progress for granted. The hon. Member for Wallasey agreed, reminding us that we need to be mindful of the risks that exist and that by fighting together we can make sure that progress continues to be made.
The hon. Member for Cardiff South and Penarth (Stephen Doughty) talked about Pride events in Wales and how things are different today, including in villages. As someone who grew up on the Isle of Anglesey back in the 1970s and 1980s, I remember that if you wanted to go to a gay club, you had to travel miles into Llandudno on the first Monday of the month. It really has been interesting to listen to the debate, although one of the most shocking things I heard was that the hon. Member for Sheffield, Hallam (Olivia Blake) was born in 1990, which makes me feel incredibly old.
As the hon. Member for Wallasey said, it is important for us as LGBT people to remember our past and understand it, to celebrate our present and to create our future. Those are the principles of LGBT History Month, and they are the principles that I and many people here in Parliament are proud to stand up for today, in a House that has more LGBT people than ever before.
We have rightly remembered many of the battles for rights and the fact that persistence was often the way to ensure things happened. Whether it be in respect of section 28, the gender recognition certificate, the age of consent or equal marriage, the remark by the hon. Member for Wallasey about the sky not falling in was very true indeed. In fact, I remember that after the equal marriage debate people were very quickly boasting that they had been to a gay wedding, and celebrating that fact.
The theme for LGBT History Month this year is the celebration of the contributions made by LGBT people in the fields of medicine and healthcare. We are asked to look “under the scope” and recognise the invaluable contributions of LGBT people across the medical and healthcare sectors—including in our world-renowned NHS—which have often been overlooked, so for a moment I will reflect on that.
The UK has long been known for trailblazing healthcare professionals, and I am proud that this debate gives me a chance to pay tribute to some of those trailblazers who were LGBT. Dr Sophia Jex-Blake was a 19th-century Scottish physician who was most widely known as Scotland’s first ever practising female doctor, and for her pivotal role as a member of the Edinburgh Seven. Sophia devoted her life to the advancement of women’s rights in the field of medicine and helped to lead the campaign to secure women’s access to university education. After qualifying as a doctor, she helped to found two medical schools for women, in London and Edinburgh, at a time when medical schools were training only men.
Sophia retired to Sussex in 1899, where she moved in with Dr Margaret Todd, a fellow physician who many believe was her partner. Sophia was never openly a lesbian, but upon her death Margaret published Sophia’s private musings, many of which confessed her love for women.
Another extraordinary and hidden story is the life of Sir Ewan Forbes. On the surface, his life might appear to be one of genericity. Born into an aristocratic family in Aberdeenshire, Ewan graduated as a doctor in his early 30s and began practising as a local GP. Not long afterwards, he married Isabella Mitchell. From a young age, Ewan was open about his transgender identity, at a time when being trans was not understood and certainly was not socially acceptable. Although registered female at birth, Ewan recognised that his legal sex was not his true self and, with the support of his family, was believed to have undergone pioneering gender-affirming care.
Upon marrying his wife, Ewan sought to make the marriage legal by seeking legal gender recognition in 1952. Although a taboo topic at the time, it was relatively smoothly awarded upon that request. However, Ewan’s legal recognition was later questioned when his older brother died and he was set to inherit the fortune and become a baron. At the time, this was seen as scandalous, as many did not accept the legal gender recognition. Ewan took the case to the Scottish Court of Session and won. Despite the case being conducted in secrecy, it marked a pivotal moment in transgender rights. The fascinating details of Ewan’s life were recently recorded in a book, “The Hidden Case of Ewan Forbes”, which is a much-recommended read.
As others have said today, we should think not just about the past, but the future, and the present day. That gives me an opportunity to pay tribute to my colleague, Dr Michael Brady. Michael is a sexual health and HIV consultant at King’s College Hospital, as well as NHS England’s first ever national adviser for LGBT health, where he leads work to tackle health inequalities faced by the LGBT community.
Michael has long worked for better healthcare for LGBT people. Alongside his role as national LGBT health adviser, Michael spent 15 years as the medical director at the Terrence Higgins Trust. He played a huge role in advocating for the national roll-out of pre-exposure prophylaxis—PrEP—the HIV prevention drug. He consistently strives to improve healthcare provision and outcomes for LGBT people in his everyday role. I pay tribute to all the others we could mention under the theme of LGBT History Month.
I come on to some of the other points raised today, including the international picture. I absolutely recognise the great strides that many countries have made—colleagues have raised many important points—but, clearly, there are some awful things still happening. As many have mentioned, the laws in Uganda, Ghana, Hungary and Russia are extremely concerning.
I assure hon. Members that, as a Government, we continue to raise these issues whenever we have the opportunity. The Foreign, Commonwealth and Development Office has a new five-year, £40 million LGBT rights programme. That programme will hopefully transform the lives of millions of LGBT people around the world, by reducing the violence and discrimination that they experience, and by offering support to those who campaign, sometimes very bravely in hostile environments.
Kirsten Oswald
I am interested in the Minister’s point about the situation in different countries overseas. What are his reflections on the situation for LGBT+ people in Rwanda? Is he able to tell us his thoughts in relation to his Government’s plans there?
Stuart Andrew
My view is very clear. Wherever there are challenges for LGBT people, we have a duty to raise them at every point. That is not just in Rwanda. There are lots of other countries in which we have lots of different agreements. It is important to raise the issues, even with good friends of ours, when we think that they are making decisions that are not in the best interests of the community that we all want to support.
Elliot Colburn
I pay tribute to the FCDO’s work in this area. I was invited by the British embassy in Prague to go and speak with our sister party and parliamentarians in Czechia last year, to persuade them that the sky would not fall in if they passed legislation for equal marriage. I pay tribute to the work that our officials are doing internationally in this area.
Stuart Andrew
I absolutely agree with my hon. Friend. That is exactly the opportunity presented by the work of our colleagues in the FCDO in helping us to share our experiences. There are challenges bringing through these pieces of legislation and these reforms. I remember all those emails coming in when we were having the equal marriage debate, but the next day, as the hon. Member for Wallasey said, the sky had not fallen in, and most people cannot even believe that 10 years ago LGBT people could not get married. That is what we need to do to spread the gospel, as it were.
The hon. Lady also mentioned how far we have come on HIV and AIDS. Given the topic of this year’s history month, it is important to talk about that. She rightly said we are all aware of the scars that the HIV and AIDS crisis left on so many in the LGBT community and on their friends and family, and sadly we lost far too many. Thanks to the advancement of medicine, HIV is a preventable and treatable condition that is no longer seen as the death sentence it once was. Instead, it is easily manageable, and people can live long, happy lives post diagnosis. That is why I am pleased that we have committed to investing more than £4.5 million in our national prevention programme and to ending new HIV transmissions and AIDS and HIV-related deaths in England by 2030. It is an ambitious target, but we are on course for it.
Great progress has already been made through our national HIV action plan. NHS England has committed £20 million to expand opt-out HIV testing in emergency departments in local areas with the highest prevalence of HIV levels. That has helped identify more than 1,000 people with untreated or undiagnosed HIV in the first 21 months, which is truly fantastic. The message still needs to be that people need to keep testing, because the sooner someone is diagnosed, the sooner they can get treatment and live that happy and normal life.
I will move on to the issue of conversion practices—my favourite part. Hon. Members will know my personal views on the matter, and I am pleased to say there is a consensus among the vast majority that no one in this country should be harmed or harassed for who they are, and that extends to the threat of conversion practices. I want to make it clear that attempts at so-called conversion therapy are abhorrent. To stand up for LGBT people, it is key that we end any practice that falsely claims to cure or change a person’s identity. We are clear on our stance that such practices are harmful and simply do not work. That is why we are still committed to publishing a draft Bill on this topic for pre-legislative scrutiny soon. That will include targeting efforts to change someone from or to being transgender. It is a sensitive area and one of great debate. I have always wanted to do this, but even I have recognised that there are challenges, and I have to be honest about that.
I pay tribute to the hon. Member for Brighton, Kemptown (Lloyd Russell-Moyle) for the considered way he presented his Bill. I am sorry that I was not there; I was at a ministerial meeting in Glasgow. As I say, I recognise the considerable effort he took in drafting the Bill and know that he did that with criticism from both sides of the argument. The Government still want to introduce their own Bill, and that is why there was that decision to oppose it. The Government have rightly taken time to carefully consider the issues and ensure that our Bill is as robust as possible. Moreover, it is right and proper that the Government present it for pre-legislative scrutiny, so that we can have a further safeguard, ensuring that it does what we expect it to do.
In the meantime, I am keen to remind the House that the Government fund a victims support service, run by the anti-violence charity Galop. That enables those at risk of or undergoing conversion practices to report their situation and access tailored support and guidance. I keep repeating that because I want people to know that there is somewhere they can go to get help should they need it.
Dame Angela Eagle
I know how difficult it is for a Minister to get the entire Government to agree to do what they want them to do, when they want them to do it. However, that formulation of words has been used many times and we are coming to the end of the Parliament now. Can the Minister give us even a hint of whether this Bill will appear at all, or will we have to wait until after the general election?
Stuart Andrew
As I said, it is our intention to publish a draft Bill, but I cannot give a specific date. The hon. Lady helpfully outlined some of the challenges she faced as a Minister. I assure her that it is our intention to publish a draft for scrutiny. Equally, I have heard the message from my hon. Friend the Member for Carshalton and Wallington and others, and I will certainly relay that.
All Members have mentioned the issue of violence and hate crime, which is incredibly important. We are aware that, sadly, many LGBT people in the UK and across the world still experience violence and discrimination just because of who they are. The sentencing following the horrific murder of Brianna Ghey recognised that her death was caused in part by hostility towards her transgender identity. Once again, I send my condolences to her family, and I hope that no other families have to endure what they have had to go through.
We expect the police to prosecute the perpetrators of violence and the courts to consider the aggravating factors when determining sentences, in line with our hate crime legislation. We have been doing more to tackle hate crime head on. We have made hate crime a priority offence in the Online Safety Act 2023, and under new legal duties of care, technology companies must prevent, identify and remove illegal content and activity online. That means that illegal content, including content that incites hate on the grounds of race, religion or sexual orientation, will be removed quickly when it appears. However, I recognise that this is still a worrying time. Since the many attacks last summer, I have made it a priority to meet the Metropolitan police and others to understand what they are doing to make people feel supported during the process of reporting crimes, and not like they are the ones being grilled.
I will end by sharing how proud I am to stand in this House, to represent my constituency and to hold my ministerial positions as an openly gay man. We must remind ourselves how far we have come in progressing LGBT rights, but we must remember that we have some way to go. The hon. Member for East Renfrewshire (Kirsten Oswald) referred to the footballer Zander Murray. As the Sports Minister, I am acutely aware that for many in the LGBT community, sport can sometimes feel intimidating. That is why making it more inclusive and welcoming as part of our strategy is a personal priority.
I hope that we can all take away the importance of remembering all those who came before us—all the LGBT people who made great contributions to the world around them, but were sadly forced to hide who they truly were, were never accepted or even persecuted for their true identity. Looking ahead, I look forward to the invaluable contributions of LGBT people that we are yet to see. If this year’s theme of LGBT History Month shows us anything, it is that LGBT people can make changes that better the lives of all of us.
Elliot Colburn
It is a pleasure to serve under your chairmanship at the end of this debate, Mr Robertson. I thank all participants, but particularly the co-chair of my APPG, the hon. Member for Wallasey (Dame Angela Eagle): I just assumed that she must be right hon. I am incredibly grateful for her friendship and diligent work in this area as we co-chair the APPG. I have been very lucky to share that privilege with her. It has been great for us to bring this issue to the House again today.
I do not want to make the Minister feel even older, but I want to end on the point hon. Member for Wallasey made, that younger LGBT+ people have perhaps taken their rights for granted. As someone who was born in 1992—apologies to the hon. Member for Sheffield, Hallam (Olivia Blake)—I think that can sometimes be true. I am glad to say that I was very lucky. My school was very progressive in that sense, and I had a great childhood. I did not necessarily come up against some of the barriers that those who came before us did.
It is important for us to remember that we should continue to fight together. If we allow them to remove the trans from the rest of the LGB community, they will come after us next. If we allow them to come after us next, they will surely go after women’s reproductive rights and other human rights. We know that these things are intertwined. It is all heading in the same direction: the eradication of certain hard-fought and hard-won rights. I am grateful to the Minister for his considered response. I know that in him we have a friend, as the Government’s chief gay, as it were. I appreciate him taking the time to respond to this debate today.
Question put and agreed to.
Resolved,
That this House has considered LGBT History Month.
Written Statements
Security and Intelligence Agencies: Contingencies Fund Advance
(2 months ago)
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The Parliamentary Secretary, Cabinet Office (Alex Burghart)
The Minister of State, Baroness Neville-Rolfe DBE CMG, has today made the following statement:
The security and intelligence agencies have presented a supplementary estimate for approval to Parliament in the central Government supply estimates booklet (HC 500, published on 27 February). Full details can be found on www.gov.uk. As it will be some time before the associated legislation receives Royal Assent, the agencies are seeking an advance from the Contingencies Fund in order to meet contractual commitments.
Parliamentary approval for additional resource of £5,295,000, capital of £96,261,000 and cash movement of £66,444,000 has been sought in a supplementary estimate for the security and intelligence agencies. Pending that approval, urgent expenditure estimated at £168,000,000 will be met by repayable cash advances from the Contingencies Fund.
As the security and intelligence agencies are non-ministerial Departments, I am making this statement on behalf of their accounting officer to ensure that Parliament is informed of this advance from the Contingencies Fund.
[HCWS316]
Sunnica Energy Farm: Development Consent Application
(2 months ago)
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The Secretary of State for Energy Security and Net Zero (Claire Coutinho)
This statement concerns an application for development consent made under the Planning Act 2008 by Sunnica Energy Farm for the construction and operation of a solar photovoltaic electricity generating station, situated across West Suffolk and East Cambridgeshire.
Under section 107(1) of the Planning Act 2008, the Secretary of State must make a decision on an application within three months of the receipt of the examining authority’s report unless exercising the power under section 107(3) of the Act to set a new deadline. Where a new deadline is set, the Secretary of State must make a statement to Parliament to announce it.
The current statutory deadline for the decision on the Sunnica Energy Farm application is 7 March 2024.
I have decided to set a new deadline of no later than 11 April 2024 for deciding this application.
The decision to set the new deadline for this application is without prejudice to the decision on whether to grant or refuse development consent.
[HCWS322]
Westminster Foundation for Democracy Review
(2 months ago)
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The Minister of State, Foreign, Commonwealth and Development Office (Mr Andrew Mitchell)
My noble Friend the Minister for the Middle East, North Africa, South Asia, United Nations and the Commonwealth, Lord Ahmad of Wimbledon, has today made the following statement:
I wish to inform the House that the Government have today published the independent public body review of Westminster Foundation for Democracy (WFD), an executive non-departmental public body of the Foreign, Commonwealth and Development Office (FCDO).
The Government launched this review in autumn 2023, and it concluded in December. The review was independent and formed part of the public bodies review programme, which delivers against the commitments made in the declaration on Government reform to increase the effectiveness of organisations to ensure they are set up in the best possible way to deliver.
The Government set out in the 2021 integrated review of security, defence, development and foreign policy our approach to shaping the international order organised around open societies and economies. The integrated review noted the role of WFD in helping us deliver the ambition to support strong, transparent and accountable political processes and institutions overseas, including parliaments and political parties.
The 2023 integrated review refresh reaffirmed our commitment to sharpening the UK’s posture; shaping, balancing, cooperating and competing wherever we are active internationally to create the conditions, structures and incentives necessary for an open and stable international order.
The 2023 White Paper “International development in a contested world: ending extreme poverty and tackling climate change” stated our intention to harness the best of the UK’s capability, including WFD, to create fairer, more inclusive, and accountable democratic systems around the world. It also suggested that increased funding could be made available to WFD, subject to the outcomes of the public bodies review.
The review reaffirms WFD’s relevance and effectiveness. It also makes a number of recommendations for improvements with regards to the relationship between WFD and the FCDO; and WFD’s governance, risk management, and efficiency. The Government accept all these recommendations, and will work with WFD to implement them.
We would also like to extend our thanks to the lead reviewer and the review team for dedicating much time and consideration to this review.
The publication will be placed in the Libraries of both Houses.
[HCWS320]
Clinical Indemnities Reform
(2 months ago)
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The Parliamentary Under-Secretary of State for Health and Social Care (Maria Caulfield)
In December 2022, I reported on the steps we are taking to respond to the findings of the inquiry into the issues raised by disgraced surgeon, Ian Paterson. Today, I am reporting further progress on recommendation 10 of the inquiry report, which identified shortcomings in the clinical negligence cover system.
Clinical negligence cover is the system that enables patients to receive compensation if they are harmed during treatment through the cover held by regulated healthcare professionals such as doctors, nurses and dentists. The inquiry highlighted that Paterson’s private patients were unable to access compensation for the harm caused by his actions due to gaps in clinical negligence cover in the independent sector. These gaps do not occur in the NHS where cover is via a state scheme.
The Government’s implementation update on the inquiry’s recommendations included proposed policy options for recommendation 10. One of the policy options was to make the system more transparent through safeguards, such as the introduction of a code of practice for medical defence organisations which provide a particular type of clinical negligence cover called discretionary indemnity that many healthcare professionals purchase. Unlike regulated insurance, where terms and conditions are set out contractually, discretionary indemnity allows for discretion to be applied to accept or refuse claims.
Following engagement with patients and the wider sector last year, I am pleased that medical defence organisations propose to implement a sector-led code of practice by end of 2024. The aim of this code is to provide greater transparency around this system of discretionary indemnity.
For example, there will be more information on how decisions are made to assist healthcare professionals to pay patients compensation. The code will include an escalation procedure with an independent review of disputed claims assistance decisions. Importantly, the code will now offer healthcare professionals information on the basis of any decisions to decline claims.
We welcome the code as a meaningful step forward. The Department of Health and Social Care will evaluate its implementation, including the long-term impact on patients and healthcare professionals, to determine whether further intervention is required. I will provide an update on further steps to reform the clinical negligence cover system, such as addressing cover for criminal acts or when a healthcare professional has otherwise worked outside the terms of their cover, in due course.
Alongside this update, the report on a survey that the Government commissioned IFF Research to carry out into healthcare professionals’ clinical indemnity arrangements will also be published. A copy of the report will be placed in the Library of both Houses.
[HCWS318]
Dental Patient Charges Uplift 2024-25
(2 months ago)
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The Parliamentary Under-Secretary of State for Health and Social Care (Dame Andrea Leadsom)
The Department recently published our plan to recover and reform NHS dentistry, which will make dental services faster, simpler and fairer to patients and will fund around 2.5 million additional appointments (or more than 1.5 million additional courses of dental treatment). The plan sets out a number of actions that will improve access for patients, by helping the sector to recover activity more quickly, addressing underlying issues and setting out the action needed for longer-term reform of the system. Band Description From April 2024 (proposed) 1 This band includes examination, diagnosis (including radiographs), advice on how to prevent future problems, scale and polish if clinically needed, and preventative care (e.g. applications of fluoride varnish or fissure sealant). £26.80 2 This band covers everything listed in band 1, plus any further treatment such as fillings, root canal work or extractions. £73.50 3 This band covers everything in bands 1 and 2, plus course of treatment including crowns, dentures, bridges and other laboratory work. £319.10 Urgent This band covers urgent assessment and specified urgent treatments such as pain relief or a temporary filling or dental appliance repair. £26.80
The National Health Service (Dental Charges) (Amendment) Regulations 2024 (“the Amendment Regulations”) were laid in Parliament on 1 March 2024 to increase national health service dental patient charges in England from 1 April 2024.
NHS dental patient charges provide an important revenue source for NHS dentistry and are typically uplifted on 1 April each financial year. In April 2023, the Department of Health and Social Care implemented the first dental patient charge uplift since December 2020. The economic climate at the time, along with an extended period between uplifts and increasing costs of delivering NHS dental care, meant that a higher than usual uplift of 8.5% came into force in April 2023. This allows a smaller uplift for 2024-25 without adversely affecting NHS budgets. It is important that current and future work to improve NHS dentistry is not undermined by the risk of reduced funding because of lower NHS dental patient charge revenue.
Therefore, from 1 April 2024, dental patient charges in England will increase by 4%. This means that a dental charge payable for a band 1 course of treatment will rise by £1, from £25.80 to £26.80. For a band 2 course of treatment, there will be an increase of £2.80 from £70.70 to £73.50. A band 3 course of treatment will increase by £12.30, from £306.80 to £319.10.
Details of the revised charges for 2023-24 can be found in the table below:
We will continue to provide financial support to those who need it most by offering exemptions to the dental patient charges for a range of circumstances. Patients will continue to be entitled to free NHS dental care if they are under 18, or under 19 and in full-time education; pregnant or have had a baby in the previous 12 months; are being treated in an NHS hospital and have their treatment carried out by the hospital dentist (patients may have to pay for dentures or bridges); receiving low-income benefits; or are under 20 and a dependant of someone receiving low-income benefits. Support is also available through the NHS low income scheme for those patients who are not eligible for exemption or full remission.
Whilst we recognise that this uplift follows a higher than usual uplift of 8.5% in April 2023, we consider that this is proportionate, as the cost of delivering NHS dental care continues to increase and dental patient charges have typically been uplifted by 5% each year, which is above the rate of inflation. The 4% proposed uplift creates a real terms increase of 2% since April 2023. Dental patients will benefit from the continued provision that this important revenue supports.
In addition, the Department is seeking an amendment to a previous change made to the National Health Service (General Dental Services Contracts) Regulations 2005 and the National Health Service (Personal Dental Services Agreements) Regulations 2005 in June 2023. This amendment seeks to clarify that the powers regarding unilateral rebasing of underperforming NHS dental contracts applies on a prospective only basis, in line with the views of the Joint Commission on Statutory Instruments.
By providing clarity in this previous amendment, NHS dental commissioners will be able to prospectively rebase persistently underperforming contracts and improve access to NHS dental care for patients.
These measures are in addition to the reforms announced in July 2022—the first changes to the dentistry contract since 2006. We are also working on further reforms to the 2006 contract and we expect to develop options for consultation with the dental profession in advance of a further announcement later this year. Any changes would be phased in from 2025 onwards.
[HCWS317]
Local Authority Interventions: Sandwell, Liverpool, Thurrock and Tees Valley
(2 months ago)
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The Parliamentary Under-Secretary of State for Levelling Up, Housing and Communities (Simon Hoare)
All hon. Members will recognise the critical role local authorities play in providing services to their residents and being accountable to the communities they serve. I would like to update the House on actions the Government have taken in relation to four local authorities, which demonstrate the importance with which this Government see our role in ensuring the high standards that we set for local government are met. I am updating the House on the developments in the statutory interventions in Sandwell, Liverpool and Thurrock councils and on the Tees Valley Mayor’s initial response to the independent review published on 29 January.
Sandwell Metropolitan Borough Council
Following evidence provided by a governance review from its external auditor, Grant Thornton, Sandwell Council has been under statutory intervention since March 2022. The review included statutory recommendations to the council and detailed years of governance issues, leadership instability, and a breakdown in trust, respect and confidence between members and officers. These led to some significant failures. The review led the Secretary of State to decide that the council was failing to comply with its best value duty and consequently directions were issued and commissioners appointed.
Given Grant Thornton’s observation that “green shoots” of improvement had started to show at Sandwell, the intervention package was shorter and narrower than other interventions. I wish to update the House on the fourth and final report from the commissioners and the end of the intervention.
The commissioners’ fourth report
Since the beginning of the intervention, the commissioners have been clear about the aim of the intervention, setting out in their first report their “12 proxies for success”, as the House was updated on in the statement of 1 December 2022. These proxies brought together all the recommendations of the Local Government Association (LGA), CIPFA and Grant Thornton reviews, and commissioners reported against these proxies in each report.
On 20 December commissioners submitted their fourth report, setting out that the council is
“a far cry from the organisation first encountered”
in March 2022, and noting the considerable progress even since their third report. They observe
“the scrutiny and accountability systems, including performance and risk management, are robust and being upheld rigorously. The improvement work which was once seen as a standalone priority has now been interwoven with the “business as usual” strategic planning of the council.”
They also praise the staff at the council,
“who were eager to...work hard to improve”
from the outset. They conclude that the council is now an organisation that is “resilient and agile enough to provide its services to residents whilst withstanding adversity, and one with the plans, aspiration and people to strive for excellence independently”.
The commissioners conclude that
“the council is now meeting its best value duty and is capable of taking forward its improvement independently”,
recommending that the directions be permitted to expire as planned on 22 March and that they too leave their roles at the council on that date. Having considered carefully the evidence, including triangulation with the council’s own assessment of its progress and the follow up review from the external auditor, Grant Thornton, I am happy to update the House that the Secretary of State and I are satisfied that the council is now meeting its best value duty. Consequently, when the directions expire on 22 March 2024 the intervention will end.
The commissioners’ fourth report and my response to them and to the leader of the council will be published on www.gov.uk today.
It is right that, as the commissioners acknowledge, improvement “is never finished”: Sandwell is not perfect. However, the draft statutory guidance on best value standards and intervention, which we intend to finalise shortly following the consultation last summer, is clear that
“local authorities are not expected to be perfect before an intervention ends”
and that an intervention should
“resolve incidents of failure to the point where the authority can demonstrate that it now has the capacity and capability to sustain its own journey of continuous improvement without the need for further external involvement.”
It will take continued, concerted effort for the council to sustain the rate of improvement, build further resilience and ultimately continue to improve outcomes for residents. The commissioners note that part of that striving for excellence will include the continued development of the council’s partnership working with its neighbours, the wider local government sector and supporting its staff and elected members.
Next steps
To that end, I am pleased to note that the LGA will be working to support Sandwell over the next 12-18 months, to ensure a steady path out of intervention. As I said in the Chamber in the Adjournment debate on 18 January on the governance at Sandwell, “falling back into the old ways...will not be tolerated.” We will keep a weather eye on Sandwell, and continue to be there to support, advise and encourage.
Liverpool City Council
On 13 December 2023, I announced that the Secretary of State was minded to change the scope of the intervention at Liverpool by returning certain functions to the council by March 2024, together with updating the directions as part of a planned and phased transition towards the end of the intervention. Today I am confirming that these proposals will be implemented.
The intervention started on 10 June 2021 following a best value inspection. Since then, the scope of intervention has changed, and there are five commissioners who can exercise functions relating to regeneration, highways, finance, and property and their associated governance.
When I announced to the House that I was publishing the commissioners’ fourth report, together with the Government’s response that the Secretary of State was minded to change the intervention, I invited representations on the proposals by 2 January 2024. Having considered carefully the two representations received (one from the council and one from a member of the public), and other relevant information, the Secretary of State has decided to implement those proposals.
Accordingly, the Secretary of State has returned certain functions to the council, recognising the progress made and as part of a planned and phased transition towards the end of the intervention. The commissioners will no longer exercise the following functions:
all executive functions associated with highways, from 31 March 2024;
the requirement from section 151 of the Local Government Act 1972, to make arrangements for the proper administration of the authority’s financial affairs, and all functions associated with the strategic financial management of the authority, from 31 March 2024, to include:
the power to amend budgets where commissioners consider that those budgets constitute a risk to the authority’s ability to fulfil its best value duty; and
providing advice and challenge to the authority in the setting of annual budget and a robust medium term financial strategy (MTFS) for the authority.
all functions in relation to the appointment, organisation and performance of persons to positions the holders of which are not designated as statutory officers, and the designation of those persons for tiers 1 to 3 from today.
In addition, directions issued to the council today direct the council to undertake a range of actions to the satisfaction of commissioners, including to:
allow commissioners to provide advice and challenge to the authority on strategic decisions related to its finance function, including the setting of annual budgets and medium term financial strategy;
continue to build on improvements to rebuild trust with residents, in particular to improve FOI performance, report writing and systems to record delegated decisions;
complete a review of the strategic risk management and implement a strengthened mechanism based on its recommendations;
significantly progress the implementation of the corporate landlord model, commence the stock condition surveys to understand better the asset base, develop comprehensive asset management plans and produce a revised structure for the property directorate; and
continue to establish and implement a cultural change programme which embeds a customer focus, performance management culture, systems and reporting across the organisation.
The Secretary of State has removed directions to the authority that commissioners have confirmed have been met and revoked the directions issued on 10 June 2021 and 8 November 2022. Outstanding actions have been retained in the new directions issued today, and commissioners will continue to exercise functions relating to governance, regeneration, property management and appointments (for directors of property, human resources/organisational development and statutory officers).
I also wish to put on record our thanks to Joanna Killian who will be leaving the commissioner team on 17 March when she becomes the chief executive to the Local Government Association.
The new directions, accompanying explanatory memorandum, representation from the council, and my response to the commissioners will be published today on www.gov.uk.
The next commissioners’ report, due in March 2024, will provide a full assessment by commissioners of the intervention and will be vital to support our decision on how to proceed. I will update the House at that time.
Thurrock Council
Thurrock has been in intervention, with commissioners appointed, since 2 September 2022, after grave concerns were raised about the scale and commercial risk facing the council. On 1 March 2023 the intervention was expanded.
On 22 January 2024, commissioners submitted their third report on the progress of the intervention. This describes continued progress, with the council “owning its recovery” and demonstrating it is able to take difficult decisions. I am pleased to see the strengthening of member officer relationships and that all councillors agreed to adopt and commit to the enhanced improvement and recovery plan in October; it is important that there continues to be a whole-council approach to Thurrock’s recovery.
While the progress to date is to be commended, there is still much to do, including addressing ongoing governance requirements and ensuring the council has underpinning plans to implement its recovery, including a corporate plan and operating model. The financial situation should not be underestimated, with commissioners making clear that the challenge remains substantial.
There has undoubtedly been good progress at Thurrock, and it is imperative focus is maintained in the months ahead on the long-term priorities, to continue to build upon and drive the necessary improvements. The commissioners’ report and my response will be published today on www.gov.uk.
Tees Valley Combined Authority
On 29 January my hon. Friend the Minister for Housing, Planning and Building Safety made a statement to this House alongside the publication of the report of the independent panel investigating the Tees Valley Combined Authority’s oversight of the South Tees Development Corporation and Teesworks joint venture.
The review was commenced in June 2023 following very serious allegations made in the House regarding potential corruption and illegality. As my hon. Friend confirmed, the independent panel found no evidence of corruption or illegality and the panel made several useful and important recommendations on governance and oversight.
Upon publication of the report the Secretary of State wrote to the Mayor and asked for an initial response to the report and its recommendations by 8 March: this was received on 28 February and also published by Tees Valley Combined Authority. The Mayor has accepted, in principle, all the recommendations for the combined authority and development corporation. His response proposed actions for each of the 26 recommendations for the combined authority, development corporation, and partners, as well as outlining actions he has already taken, including establishing a combined authority working group to take this forward. I welcome the independent support the Mayor is seeking from the LGA and the Centre for Governance and Scrutiny and have encouraged him to make full use of independent peer challenge and support.
I am encouraged by the progress within the first month and keen to give time now for the Mayor to develop his plans further and implement the changes required. These will enhance the successes of the Teesworks regeneration by ensuring governance arrangements and accountability are strong and transparent, and supported by robust scrutiny. Given the issues raised in the report, it is important that rapid progress is made that engages comprehensively with the substance of the report’s findings to implement lasting change. To that end, I look forward to receiving further updates from the Mayor, which I have asked for initially after six months.
I am confident that the Mayor and his cabinet will implement successfully their plans and continue their important work regenerating and bringing new jobs to the Tees Valley. The Mayor’s response to the review and the Secretary of State’s reply will be published today on www.gov.uk.
Conclusion
I want to acknowledge the work of the dedicated staff who deliver the important services of local authorities, on which local residents depend. I also want to thank the commissioners in Sandwell, Liverpool, Thurrock, and other councils in statutory intervention, for all they do. I will deposit in the House Library copies of the reports and associated materials.
[HCWS319]
Nationally Significant Infrastructure Projects
(2 months ago)
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The Minister for Housing, Planning and Building Safety (Lee Rowley)
Building the next generation of road, rail and energy projects will be the cornerstone of the United Kingdom’s future success. New infrastructure transforms communities, cuts congestion, and improves the resilience of our country for the long-term.
Over a decade ago, the Government turbocharged the delivery of new infrastructure by introducing nationally significant infrastructure projects consenting process for projects in England and Wales, and in some limited circumstances, Scotland. This has served Great Britain well for more than a decade and created a planning and consenting process that acknowledged the unique importance of a number of key projects across energy, transport and water. Since then, over 120 projects, from major offshore wind projects like Hornsea 2 to vital nuclear power generation such as Hinkley Point C, have successfully been approved, with many others constructed and operational, such as the East Northants Resource Management Facility and the Heysham to M6 Link Road —all for the benefit of Great Britain.
Building on the “National Infrastructure Strategy” of November 2020, and in recognition of changing circumstances, we launched a major programme of reform and improvement to our NSIP processes. While much is still being built successfully, the speed at which decisions are made has slowed and demands on the system are intensifying. Change is needed if we are to meet the growing demands on our country’s infrastructure.
Last year we acted by publishing an action plan, setting out our plans to reform the way in which our major infrastructure is consented and we promised consultation on key elements of those reforms before implementation, following feedback from industry and interested parties.
Today, following the conclusion of that consultation, I am pleased to confirm the following major improvements to our nationally significant infrastructure projects consenting process in the future:
A major increase to the capacity within the planning system by better resourcing public bodies through costs recovery for the advice and services they give to applicants – with additional resources in place already and cost recovery being introduced from 1 April;
New secondary legislation to make vital changes to the legislative framework under which the system operates covering the way in which examinations are conducted – to support faster and more proportionate examinations for all projects – in force by the end of April;
Improvements to and strengthening of national infrastructure planning guidance to provide clarity for applicants and ensure that all users of the system are provided with the guidance they need to maximise the benefits of the system changes, and to help navigate applications more efficiently – live by the end of April.
A new pre-application process, designed to allow applicants to work with the Planning Inspectorate to speed up decision making and ensure that consultation is effective and proportionate, which will be available for any project which requests it from this Autumn, on a cost recovery basis;
A new fast-track route to consent, to enable projects which meet a quality standard to progress through the process in one year—available from autumn;
We have provided £3.5 million of taxpayer funds to support innovation and capacity in local authorities that are working, right now.
As we have said, clear policy is the foundation of a successful consenting system. We are close to fulfilling our commitment to updating our key national policy statements, with five revised energy NPSs now designated and an NPS for national networks published and laid before Parliament yesterday for intended designation next month. This is in addition to the new water resources NPS designated last year.
A copy of the consultation response on operational reforms to the nationally significant infrastructure projects consenting process will be deposited in the Libraries of both Houses.
[HCWS321]
Space Industrial Plan
(2 months ago)
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The Minister for Science, Research and Innovation (Andrew Griffith)
The Department for Science, Innovation and Technology recently passed the one-year milestone since its creation—a year in which we have firmly embedded our mission and delivered against it, driving innovation that will improve public services, create new well-paid jobs, and grow the economy.
The UK is already ranked by the World Bank as the best place to do business among large European nations. Combined with the City of London and the research strengths of our universities, our space sector is poised to support our growth ambitions.
Our commitment to innovation and enterprise, backed by a globally competitive tax regime and smart regulation, uniquely positions us at the forefront of technological advancement and economic growth in space.
For the UK space sector, our “National Space Strategy” encapsulates not just my Department’s mission, but the whole of Government’s ambition to develop one of the world’s most innovative and attractive space economies. As part of that journey, we published “The National Space Strategy in Action” in July 2023, setting out our key next steps on the road to achieving that ambition.
Today we take another a significant step towards unlocking growth and developing resilience in the UK space sector, with the publication of Government’s space industrial plan.
Building on the foundations of our national and defence space strategies, the space industrial plan is a joint civil and defence publication that sets out our new way of working with the commercial space sector, modernising our approach, and giving the sector greater confidence to invest. We set out clear, timed missions and actions deliverable through a shared endeavour with the sector to address the long-term problems facing the nation: improving economic security and opportunity for everyone.
This plan sends a strong demand signal to, and provides clarity for, UK space companies and investors, giving them the confidence to invest long term in the sector. We have been decisive in sequencing the first five national space capability goals where we want the UK to excel, agreed by the National Space Council. These capabilities will support UK Government in fulfilling their commitments and legal obligations, target the specific needs of the citizen, and drive our future ambitions to unlock new markets. These capabilities are underpinned by a set of intervention areas, describing how we will utilise our main Government levers to shape the business environment in pursuit of our ambitions.
We have heard and understood the challenges facing UK space companies, and we want the world’s space entrepreneurs and innovators to come to the UK because it offers the best possible place to make their visions happen.
We are committed to making the UK the most attractive country for space industry investment, driving prosperity and security across the nation.
I will be placing copies of this publication in the Libraries of both Houses, and it will also be made available on gov.uk.
[HCWS315]
House of Lords
Military National Service
(2 months ago)
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Lord Naseby
To ask His Majesty’s Government what consideration they have given to implementing a form of military national service.
Lord Naseby (Con)
My Lords, in begging leave to ask the Question standing in my name on the Order Paper, I declare an interest in that 67 years ago this month I was awarded RAF Wings to fly jets in defence of my country.
The Minister of State, Ministry of Defence (The Earl of Minto) (Con)
My Lords, the Government have no plans to reintroduce national service or any form of conscription. Since 1963 it has been the policy of successive Governments that the best way of providing for the defence of our country is by maintaining professional Armed Forces staffed by volunteers. The demanding nature of defence today is such that we require highly trained, professional men and women in our regular and reserve Armed Forces who are fully committed to giving their best in defending our country and its allies.
Lord Naseby (Con)
I am grateful to my noble friend for his clear Answer, but many of us feel that at this point in time the warning signals are flashing red. In my conversations with our young people, particularly my grandchildren, there is a willingness to consider some form of training, either of a military reserve nature or possibly even of a national service nature. I took my oath in the other place 50 years ago today to serve the country. I believe our young people want to serve our country. Is my noble friend aware that as far as NATO is concerned, we are one of only two countries that have nothing in the way of training our young people in the challenges that arise in today’s world?
The Earl of Minto (Con)
My Lords, my noble friend makes some very good points, a number of which we can all relate to. The Armed Forces continue to meet all their current commitments, keeping the country and its interests safe. The Government remain committed to ensuring that this country has the world-class Armed Forces that it needs, deserves and has held in high reputation across the globe. We can rightly be very proud of our forces.
Lord Tunnicliffe (Lab)
My Lords, I really hope that the Minister’s Answer is not accurate. We know that there is a serious risk—not a probable risk but a serious risk—of a ground war breaking out in Europe, and we may become involved in it. This is being said by serious people such as generals, Mr Shapps and so on. Surely the military would be derelict in its duties if it was not considering that risk. Ukraine has shown that modern warfare, once again, is people-intense. The numbers in our Armed Forces are something like half what they were at the end of the Cold War. Surely the military is developing multiple scenarios, almost certainly short of conscription, to make sure that a rapid increase in resources can be achieved.
The Earl of Minto (Con)
My Lords, the noble Lord makes some very good points but, as I have said before, increasingly it is about capability rather than pure numbers. We are facing some widely known recruitment issues that are not peculiar to the forces or to the country and that are giving us a bit of a challenge, but while we have smaller forces than previously we are applying all sorts of issues to attract and retain forces across all three services.
Lord Fowler (CB)
My Lords, the noble Lord asks for consideration of
“a form of military national service”.
As one of the last national servicemen in the 1950s, I think he is wise to put it that way. I have no personal complaints, but I observe that not everyone had happy memories of this period. Otherwise, you would not have had conscripts keeping lists of days and hours left to do, and the most popular recording on British forces radio in Germany for those nearing discharge would not have been “Happy Days Are Here Again”. I agree with the noble Lord that there is a strong case for looking at this again, but if we do I hope we will find something better than the 1950s model.
The Earl of Minto (Con)
I cannot disagree with the noble Lord, but we have to rely on the fact that all three forces have a global reputation and are professional, highly trained and the envy of many. To dilute them with unwilling recruits, to a certain degree, can lead only to a slight dilution of that reputation.
Baroness Smith of Newnham (LD)
My Lords, on these Benches I will not call for military service to be reintroduced, but we are hearing from across the Chamber that this country and His Majesty’s Government need to prepare for a different security context from the one we have enjoyed for the last 30 years. Can the Minister tell the House what plans His Majesty’s Government are making to reinforce the services, including increasing the numbers of reserves and making sure our that recruitment deficit is overcome?
The Earl of Minto (Con)
My Lords, the way we address the threat is a constantly changing situation. Whether through procurement or through individual members of the forces, there is a constant ratio of training, retraining and readdressing the threat. I really believe that we have the right quality of forces in place. We know that we do not have as many as we had planned, and there are some prevalent recruitment issues. Encouragingly, applications have been well up in the last few months. We had more than 10,000 applications for regular soldiers in January; there were 53,000 applications in the period from June 2021 to 2022 and just shy of 70,000 from June 2022 to 2023.
Lord Howell of Guildford (Con)
On those words, professional, regular and reserve, my understanding is that for some years now we have been vigorously building up our whole reserve—what used to be called the territorials—including a number of combat units trained to semi-professional standards and readiness. Is that process increasing? Is it reinforcing the number of troops we really have available? Are we following some of the patterns that the noble Baroness, Lady Smith, and the noble Lord, Lord Fowler, hinted at?
The Earl of Minto (Con)
My Lords, we are. The current mix that we have in the Army is about 70,000 ground troops and about 30,000 reserves. The 100,000 target is where we are focused at the moment. The full size of the forces, currently at about 131,000, is an issue. The outflow is also an issue, as everybody is aware, and we are taking action to improve retention.
Lord Stirrup (CB)
My Lords, I agree entirely with the Minister’s remarks about conscription. One area where the Government could do more is in support for the cadet organisations. Although it is certainly not a recruiting arm of the military, the Air Cadet organisation already offers challenge, excitement, adventure and a sense of service to more than 43,000 young people from all backgrounds and communities across the UK. Can the Government ensure that they not only support this organisation in its current work but do their best to expand it?
The Earl of Minto (Con)
My Lords, I entirely agree. In a past life, I had something to do with cadets and I also trained Junior Leaders soldiers. There is no doubt that the success of those particular intakes into the Armed Forces pays dividends time and again.
Lord Snape (Lab)
My Lords although I cannot possibly match the glamorous nature of the questioner’s service, when I joined the British Army 60 years ago in the hope of being able to drive steam locomotives on the Longmoor Military Railway, the recruiting sergeant in my hometown of Stockport offered to swear me in that same afternoon and send me on my way to the Royal Engineers depot the following morning. As I understand it, these matters of recruitment are now dealt with by a company called Capita, and I read that it takes nine to 12 months for each individual to join a regiment. Does the Minister agree that, by the time we had recruited a whole regiment of these reluctant conscripts, most of them would be too old to serve?
The Earl of Minto (Con)
My Lords, the Government are doing all they can to speed up the process. The situation is improving, but the point is very well made. The sooner we can get enthusiastic men and women into the forces, the better.
Old Palace Yard
(2 months ago)
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Lord Berkeley
To ask the Senior Deputy Speaker what discussions he has had in the past year on plans to remove through-traffic from Old Palace Yard to improve safety and the environment.
The Senior Deputy Speaker (Lord Gardiner of Kimble)
My Lords, I have not been involved directly in discussions to remove through traffic from Old Palace Yard, but I am aware that parliamentary authorities are working with Westminster City Council, Transport for London and the Mayor of London’s office on the development of a scheme for the Parliament Square area. The scheme looks to improve safety and the environment, and includes assessing the possibility of removing vehicular through traffic from Old Palace Yard to Parliament Square.
Lord Berkeley (Lab)
I am very grateful to the Senior Deputy Speaker for his Answer. Would he not agree that the existing traffic through Old Palace Yard and the confusing pedestrian crossings are unsafe and not very attractive from an environmental point of view? Will he add his weight to and participate in these ongoing discussions to pedestrianise Old Palace Yard and move those barriers a bit further away—obviously, we need security—so that everybody can enjoy Old Palace Yard without fear of being run over?
The Senior Deputy Speaker (Lord Gardiner of Kimble)
My Lords, I recognise what the noble Lord has said. I should say that the political oversight group comprises Mr Speaker and the Lord Speaker, so we already have substantial weight on the parliamentary side. The initial concept design work is being undertaken by a consortium of engineers and architects, and we hope it will be finished by the end of the year. It will then need to go out for consultation to the statutory authorities and local residents, and implementation would be drawn up thereafter.
Lord Collins of Highbury (Lab)
My Lords, if my memory serves me correctly, I first saw the plans for this that the noble Lord mentioned when I was on the Finance Committee, five years ago. These plans have been thought about for five years, mainly because of the huge security risk at the front of this building, which is still not being addressed. What is the noble Lord’s estimate for the timetable for this work being undertaken? Last time I asked, I was told that it was down to Westminster City Council; well, at least we have a Labour council now, so maybe progress will be made.
The Senior Deputy Speaker (Lord Gardiner of Kimble)
My Lords, Westminster City Council and Parliament are equal partners in this, alongside the Mayor of London’s Walking and Cycling Commissioner and the Deputy Mayor for Transport. This particular scheme has been under development since 2021, although I know there have been previous ones, and the commissions of both Houses approved us finding a way forward with it.
Baroness Randerson (LD)
My Lords, my issue is rather more modest. It concerns the road safety of pedestrians using the light-controlled crossing immediately outside Peers’ Entrance. The time delay on that crossing is so long that the vast majority of pedestrians who are new to the area think that it is not working. As a result, they go out and basically play in the traffic, dodging cars. Can the noble Lord please use his good offices to put on some pressure—this could be done really quickly—to deal with the time delay on that crossing and make it safer and more effective?
The Senior Deputy Speaker (Lord Gardiner of Kimble)
My Lords, I will take back what the noble Baroness has said. I do know that safety and access concerns have been expressed by Members, including at pedestrian crossings, and parliamentary authorities have already raised this during discussions with Westminster City Council—but I will take back that point.
Lord Ranger of Northwood (Con)
My Lords, I declare my interest as the former director of transport policy for the Mayor of London. I therefore have some acute insight into this issue around traffic management, pedestrian safety and pedestrianisation. In fact, there was a scheme in 2008 to pedestrianise part of Parliament Square but, when it was looked at extensively, there was an issue post the pedestrianisation of Trafalgar Square; what would happen to traffic flow if there were any incidents in the area? It was considered that we would have gridlock within 10 minutes if we also pedestrianised Parliament Square. Taking that information into account, I urge my noble friend the Minister to please be cautious about any further pedestrianisation. There is a delicate balance between traffic flow and pedestrian safety, which has to be managed with the huge increase in cycling that we all welcome. I hope that all these things will be taken into consideration in any future scheme.
The Senior Deputy Speaker (Lord Gardiner of Kimble)
My Lords, I can confirm to the noble Lord that traffic modelling is very much part of the design work that is being undertaken, in part for the reasons described. There are clear safety advantages to this proposal, but all these things will be looked at in the balance.
Lord Touhig (Lab)
My Lords, I support the point made by the noble Baroness, Lady Randerson, about that crossing. It is extremely dangerous, it takes a long time and I am sorry to say to the noble Lord who spoke previously that cyclists seem to pay no attention whatever to a red light. I crossed there a little while ago and a cyclist bore down on me; he did not have a bell but he did shout “ding-ding”.
The Senior Deputy Speaker (Lord Gardiner of Kimble)
My Lords, clearly all users of the public highway must adhere to the law. Cyclists should be adhering to the law. I will take back the particular point about pedestrian crossings, but, as I said, there has already been a discussion on those points.
Environment Agency
(2 months ago)
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Baroness Jones of Moulsecoomb
To ask His Majesty’s Government what assessment they have made of the work of the Environment Agency in protecting public health and the environment.
The Parliamentary Under-Secretary of State, Department for Environment, Food and Rural Affairs (Lord Douglas-Miller) (Con)
My Lords, I declare my interests as set out in the register. Protecting public health and the environment is a priority for the Government. The Environment Agency, as a regulator, operator of flood defences, technical adviser on the environment and category 1 responder, is up to the challenge. Defra works closely with the Environment Agency to ensure that it is equipped to carry out its functions effectively and to deliver for the public. Since 2015, the Environment Agency’s budget has been increased by more than £700 million to £1.96 billion in this past year.
Baroness Jones of Moulsecoomb (GP)
I thank the Minister for his Answer. A fuller Answer might be that the Environment Agency is dysfunctional because of government cuts, but let me be more positive and move on to the future. From 1 January 2028, which is quite a long way in the future, the Environment Agency will be able to rescind, revoke or change any licences of water companies which are damaging chalk streams, which, as the Minister knows, are a precious resource. Globally, we have most of them here. Is a list already being drawn up? Some 77% of this country’s chalk streams are already failing to reach good ecological status, so the list needs to be written today if it is to be enacted on 1 January 2028.
Lord Douglas-Miller (Con)
The noble Baroness makes an insightful point about these precious and irreplaceable water bodies—chalk streams. Indeed, 2028 is a key date for changing the current system. Specifically, 95 licences have been revoked in chalk stream catchments since 2008. In addition to reducing the burden of abstraction pressures, the Government are protecting chalk streams and have identified them as a priority site in our storm overflows discharge reduction plan. We are also delivering restoration projects amounting to 400 kilometres in chalk stream areas, increasing investment into restoring chalk stream catchments and looking at further options as part of the environmental land management plan. Defra is also working closely with colleagues in Natural England and the Environment Agency on the chalk streams recovery package, which is intended to set out the broader approach to protecting and recovering chalk streams.
Baroness McIntosh of Pickering (Con)
My Lords, part of the problem with Environment Agency funding is the arbitrary definition of what constitutes capital spending and operational expenditure. Will my noble friend look very carefully at this in considering a total budget, or at least at getting rid of some of the arbitrary definitions that are in place?
Lord Douglas-Miller (Con)
I thank my noble friend. She is absolutely right that there are issues around this. However, there is a degree of flexibility within the capital and revenue budgets. Money is allocated each year to maintain and look after flood defences, and money is allocated for capital expenditure to make future improvements. Only last year, during the very stormy weather in the autumn, the Secretary of State reallocated capital expenditure funding to revenue for this very purpose.
Lord Addington (LD)
My Lords, will the Minister consider making sure that the Environment Agency and the Office for Environmental Protection consult other bodies? The huge benefits to mental and physical health from being active in the countryside, or even outside, in a non-formal way are documented. Is there, for instance, regular contact between the Department of Health and the Environment Agency or are we just waiting for this to happen by magic?
Lord Douglas-Miller (Con)
I am not entirely sure what the key question was. If it was about linking up across government, I assure the noble Lord that it takes place across all departments.
The Duke of Wellington (CB)
My Lords, I declare my interests relevant to this matter. In the past, the Environment Agency did not give sufficient priority to the discharge of sewage into our rivers. The Minister just explained how its budget has been increased, but the most important thing is to make the discharge of sewage and cleaning up our rivers a sufficient priority within the management of the Environment Agency. Is the Minister convinced that that is now the case and that what happened in the past will not recur, and we will have more effort from the Environment Agency in cleaning up rivers?
Lord Douglas-Miller (Con)
The noble Duke is absolutely right. Just in the last year, the Government published the Plan for Water, which marks a step change in how we manage our water. We plan to deliver clean and plentiful water for people, businesses and nature. We are delivering this with tighter regulation, tougher enforcement and more investment. The Government are committed in the 25-year environment plan to restoring three-quarters of our water bodies to be close to their natural state, and this plan will help us achieve that.
The Archbishop of York
My Lords, during Covid, we all became aware of how important it is to have access to outside space. Yet we know that many people do not have access to outside space, let alone green space, and we know the health benefits of having that space, particularly for mental health. In my work, I often visit communities, particularly in Hull and Middlesbrough, where so many people simply do not have this kind of access, and I see the consequences. I am wondering what steps the Government are taking to try to improve the situation. It is estimated that 10 million people in this country may not have ready access to green space. What steps are being taken to address this?
Lord Douglas-Miller (Con)
The most reverend Primate makes a very good point about public access. The Government are committed to everybody being within a 15-minute walk of a green or blue space. On the water environment, the designations for our bathing sites have never been in better condition. Just last week, we consulted on creating 27 new water designation bathing sites.
Baroness Hayman of Ullock (Lab)
My Lords, I would like to ask the Minister about air quality. The European Environment Agency has estimated the number of attributable deaths that could be avoided if extra air quality measures were implemented. It has also attempted to quantify the health burden associated with specific diseases caused or exacerbated by air pollution. Does UK equivalence exist in this? For example, what work is our Environment Agency doing with international equivalents to share ideas and best practice on how to tackle public health?
Lord Douglas-Miller (Con)
The noble Baroness raises a really good point on air quality. It is the single biggest pollution problem that we have. Per the Environmental Permitting (England and Wales) Regulations 2016, the Environment Agency regulates larger industrial installations, medium combustion plants and a range of other industrial areas. I am not aware specifically of the consultation we do with our European colleagues, but perhaps I can write to her on that in due course.
Baroness Eaton (Con)
My Lords, I am sure that the Environment Agency would accept that councils play an important part in the management of flood risk and coastal erosion. Despite this, councils report anecdotally that the process of securing grant-in-aid funding is becoming more and more bureaucratic and competitive. Will my noble friend the Minister update the House on what is being done to place fewer burdens on councils so that they are not forced to use taxpayers’ money to compete against other councils for grant funding?
Lord Douglas-Miller (Con)
My noble friend is right: local authorities play an absolutely crucial role in protecting the public from flooding. There is a bidding process for funding from the Environment Agency, which looks to assess where funding is most needed to protect and repair the most property and individual life. I appreciate that this is not a perfect system, and I will take this point back to the department.
Lord Trees (CB)
My Lords, what is the Environment Agency doing to improve the detection and, more importantly, reduction of the levels of antibiotic-resistant bacteria in our aqueous environments?
Lord Douglas-Miller (Con)
The noble Lord raises a very topical point. In the wider context, reducing antimicrobial resistance is one of Defra’s key objectives. I am pleased to say that, in the farming community, we have reduced the use of antibiotics by over 50% as part of the antimicrobial plan. I mention this because one of the main causes of antibiotic-resistant bacteria in our waterways comes from the agricultural sector. The Environment Agency continues to use the latest scientific tools to monitor and trial interventions against antibiotic resistance in our rivers, bathing sites and coastal waters. In October last year, the Environment Agency published a review of methods used to better survey and understand antimicrobial resistance. These are being fed into the second five-year antimicrobial resistance action plan.
Zimbabwe: Sanctions
(2 months ago)
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Lord Bellingham
To ask His Majesty’s Government whether they plan to revise the Zimbabwe sanctions regime in the light of the recent announcement by the government of the United States that it will adjust and tighten its sanctions.
The Minister of State, Foreign, Commonwealth and Development Office (Lord Ahmad of Wimbledon) (Con)
My Lords, our Zimbabwe sanctions hold to account four individuals and one entity responsible for serious human rights abuses. They do not target the people or economy of Zimbabwe. We note the US’s recent steps and continue to engage closely with our US partners. We continue to keep all sanctions, designations and regimes under review and do not comment on any future sanctions plans.
Lord Bellingham (Con)
My Lords, I am grateful to the Minister for that reply. He will be aware that the war in Ukraine and recent events in Gaza have taken the world’s attention away from some of the various crises in Africa, including the dreadful situation in Zimbabwe. Indeed, having stolen last year’s election, Emmerson Mnangagwa and ZANU-PF have harassed, threatened and imprisoned opposition figures, including the very brave Job Sikhala, closed down civil society, and undermined the rule of law. Obviously, there is no appetite in this House for economic sanctions, which would really bear down on the people of Zimbabwe, but surely we should now look at tighter and wider smart sanctions, targeted at the ZANU-PF Cabinet, their wives and their cronies. Surely the people of Zimbabwe, which was originally a net exporter of food, deserve better and a brighter future. Would the Minister agree?
Lord Ahmad of Wimbledon (Con)
My Lords, my noble friend is right. We have been deeply seized by and concerned about the targeting of civil liberties. We engaged with the Government on the PVO amendment Bill before the 2023 elections, and we have seen the so-called patriot Bill, which has limited freedom of expression. My noble friend will also be aware that the introduction of the global human rights sanctions regime in 2019 allows us to do exactly that: we can specifically target the people who commit egregious abuses of human rights rather than citizens or, indeed, a country.
Lord St John of Bletso (CB)
My Lords, does the Minister agree that the existing sanctions in Zimbabwe have not curbed President Mnangagwa’s repressive regime and left a vacuum for the Chinese and the Russians, who are occupied in mining strategic minerals? Is it not time to convene an all-party parliamentary conference in Zimbabwe to help pave the way for the incumbent Government to be more inclusive and address the reduction of poverty for millions of long-suffering Zimbabweans?
Lord Ahmad of Wimbledon (Con)
My Lords, I assure the noble Lord that part of our approach on sanctions is one element of that: using the levers that we have, in working with key partners, to ensure that the current Government adopt that inclusive approach. The noble Lord is correct: looking at what Africa and particularly Zimbabwe provide, their critical mineral resources are a major opportunity. Zimbabwe is the biggest provider of lithium, along with the DRC. There are opportunities ahead, but it needs a Government who are inclusive and protect the rights not just of those coming in but of their citizens.
Lord Oates (LD)
My Lords, the Minister will be aware that ZANU-PF has used the cover of the Zimbabwe-specific sanctions regime as a propaganda tool to excuse its economic mismanagement and corruption, which caused the economic crisis in Zimbabwe. Will the Government consider ending the specific geographic sanctions regime and focusing on the global human rights and corruption sanctions regimes? Will the UK make efforts to step up communications, particularly in the SADC region, to make clear the message that the Minister just gave: that we want to see prosperity for the people of Zimbabwe and that our sanctions are aimed not at them but at the corrupt and the human rights abusers of the ZANU-PF regime?
Lord Ahmad of Wimbledon (Con)
I pay tribute to the noble Lord for his work on the APPG. I agree that Zimbabwe has great opportunities, from looking at the people-to-people links with the United Kingdom. Again, it is demonstrable that the sanctions that we and other partners apply are not aimed at either the people or the economy. For example, our trade was £539 million in 2022-23, which is a direct challenge to what is sometimes said—that the sanctions have impacted the economy. What is needed is openness, transparency and accountability. I agree with the noble Lord; we will continue to look at our sanctions regimes. That is why I alluded to the global human rights sanctions regime, which allows us the very targeted sanctions, not just in countries such as Zimbabwe but across the world.
Lord Collins of Highbury (Lab)
My Lords, I welcome what the Minister says about targeted sanctions. They are important, but what are we doing to investigate the electoral commission, particularly after the irregularities in the election last year? What are we doing about the security leaders, who have been targeting opposition activists? The other thing I will raise again—I know the Minister will expect me to raise it—is the importance of civil society, particularly representation of workers in Zimbabwe, because international trade unions have been concerned about that. If we work with them as well, instead of it being just a British Government voice, we will have a better response in Zimbabwe.
Lord Ahmad of Wimbledon (Con)
My Lords, the noble Lord knows I agree with his last point, not just in Zimbabwe but everywhere. Countries—indeed, Governments—can learn and progress much faster and more inclusively with the engagement of civil society. In that sense, the British Government and others are sometimes accused of interference in domestic politics. That is not our intention. Our politics is to ensure that the rights of people and communities are protected. That is the approach we take.
The noble Lord is right to raise the elections. He will be aware that several election observers were there, including from the Commonwealth. The Commonwealth’s report is still awaited, but some of the other points that were made—the EU report, for example, concluded that the elections were
“marked by a curtailment of rights and freedoms”—
really lay out the current challenges. Of course we will work with partners on how we can strengthen things. SADC has been raised, but Zimbabwe also has aspirations for the Commonwealth. That provides an opportunity to raise human rights as a key component.
Lord Hannan of Kingsclere (Con)
My Lords, I was impressed by my noble friend the Minister’s response to the noble Lord, Lord Oates. Sanctions must be a scalpel, not than a sledgehammer, but I wonder whether he has made any assessment of the attitude of the Government of South Africa. Any sanctions regime in Zimbabwe depends on the collaboration of that Commonwealth state, and so far the ANC Government have been conspicuous in their opposition to any sanctions, even against the worst kleptocrats in ZANU-PF. Is this just regional solidarity, or is there a danger that they would like to do something similar at home if they thought they could get away with it?
Lord Ahmad of Wimbledon (Con)
My Lords, I often say about sanctions that I will not speculate about what we are going to do; I will not speculate on the intention of another Government. We have a strong relationship. We do not agree with South Africa on everything we do or it does, but I recently met with the Foreign Minister of South Africa and we had a very productive and candid exchange.
Lord Alton of Liverpool (CB)
My Lords, I thank the Minister for what he said about the importance of targeted rather than indiscriminate sanctions, and support what the noble Lord, Lord Bellingham, said to him. I will ask the Minister two things. First, is it not important that when we place sanctions on individuals, we do so with our allies? Given what the United States did on Monday in the context of Zimbabwe, and the identification of things such as diamonds and gold, how satisfied are we that they are not flowing through British markets and sources? Secondly, will he look again at the opaque way in which Magnitsky sanctions are imposed? Parliament has no oversight of that process. Does he not think that there should be some ability by parliamentarians, at least in camera in the Intelligence and Security Committee, to understand why some people are sanctioned and others are not, and why some countries are in the headlights and others are not?
Lord Ahmad of Wimbledon (Con)
My Lords, on the noble Lord’s final point, as I said, the global human rights sanctions regime was introduced in 2019. It allows for regular reviews. We debate particular sanctions as they are imposed on individuals or entities. I will certainly reflect on what he suggests; it is a practical suggestion. On working with partners, I have said consistently that the best sanctions come when we work together and are aligned. We continue to review what we may do next in the light of what others are doing.
Lord Howell of Guildford (Con)
My Lords, I think the State Department described its latest move in relation to sanctions as fine-tuning, aimed at easing the situation for the majority of the Zimbabwean people but hitting harder at the corrupt leaders. On this occasion, did it engage in talks with us on these measures? Everyone agrees that Zimbabwe is a long way from trying to join the Commonwealth again, although, as the Minister knows, it has been pressing very hard. Will he generally accept that the desire of a number of countries in Africa to join the Commonwealth—two did recently, and three more are on the list—is good for Africa in the future, for our influence, and for the general development of greater peace and development on the African continent?
Lord Ahmad of Wimbledon (Con)
My Lords, on my noble friend’s first point, I assure him that we are finely tuned and attuned with our colleagues across the pond. They shared their intent in advance. On his second point, only this morning I had an early-morning phone call with the Prime Minister and Foreign Minister of Samoa, and the Foreign Minister of Rwanda—the current chair; the former chair, the United Kingdom; and, of course, the host of CHOGM. That shows the importance of the Commonwealth family. When countries join the Commonwealth it is a great testament as to how they aspire to the future. This is not a legacy or colonial issue; it is about the future of how countries work together. My noble friend knows my view that we need to strengthen the Commonwealth advantage in the years ahead.
Justice and Home Affairs Committee
The Senior Deputy Speaker
Higher Education
(2 months ago)
Lords ChamberRead Full debate Read Hansard Text Watch Debate Read Debate Ministerial Extracts
Lord Blunkett
That this House takes note of the contribution of higher education to national growth, productivity and levelling-up.
Lord Blunkett (Lab)
My Lords, I draw attention to my registered interests. I am very pleased indeed to be able to lead this debate, and thank all those who are about to contribute. Across different political complexions and none, we should be able to find the kind of agreement that I hope will carry us forward for the future.
We have a choice: we can either wallow in nostalgia, meddle, or really look to a future that will be very different—a future of rapid change, where artificial intelligence and robotics will replace so many of the current employment opportunities, but will open up new opportunities for people who have the skills and adaptability to be able to take advantage of the future.
We used to talk about the knowledge economy; I do not hear it mentioned very often these days. There seems to be a view that we have too many students at universities, and too many universities putting on courses that are irrelevant. I am afraid that this view is completely outdated, and totally, utterly wrong.
This morning, the Chancellor of the Exchequer was parading his commitment, quite rightly, to the idea of productivity and growth, but the scientists, the high-level technicians, the research for the future are possible only if we have investment in our higher education system and we value and hold it dear. Innovation, knowledge transfer and the entrepreneurial skills of the future will come from people having their minds opened and their aspirations met. I am a living example of it. I went to evening class and day release to experience the value of further education, which I continue to value dearly. Being able to go to university immediately post the 1963 report of Lord Lionel Robbins transformed the life chances of literally millions of people. That understanding came on the back of what Harold Wilson used to call the “white heat of technology”—whatever happened to that?—and has been crucial to the well-being of the United Kingdom.
There are problems and challenges for our higher education system. It is going to have to adapt to changes in artificial intelligence and in the way we teach and learn, and to a very difficult financial climate. University income has dropped by around a fifth over the past five or six years. Fee levels have not increased, Brexit has affected income from European partnership arrangements, which thankfully are now being restored under Horizon—I will come to the way in which people see the contribution of overseas students in a moment—and it is a much more arid prospect for the future.
However, in Careers Week and on World Book Day, it is important to take a look at what is happening to the young people of today and to reflect on the young people of my era. According to the Labour Force Survey published two weeks ago, 850,000 young people between the ages of 16 and 25 are not in education, training or employment. In other words, they are either working in the sub-economy or doing absolutely nothing. Some 200,000 of them are alleged to be unable to work because of ill health, including mental ill health. Finding a holistic approach to giving opportunity to the young people of the future becomes even more imperative if they are not simply to languish and deteriorate in every possible way.
I remind the House and perhaps the world outside which might be listening that there are not vast numbers of young people going to university who should be doing something else. It is Careers Week, and people should get the right information, advice and guidance on what is best for them. For some, it will be to go straight from college or school into the world of work. For some, it will be taking a BTEC national diploma or a T-level and moving into work. For others, it will be an apprenticeship, if they can get through the hoops that are put in their way, particularly for those with low-level qualifications at the age of 16. However, for many, it will be exploring their future by going into higher education. Many of those 850,000 young people should be encouraged to raise their aspirations and expectations to be able to take on that challenge. Nothing is more galling than people who benefited from higher education and expect their children to go to university telling other people that it is not for them. We have to renew our commitment to the aspiration that drove me on. I have no idea now how because the careers advice I received was zilch. The report I got from the school for the blind I left was appalling, and the expectation of the world around me was that I was going to be a lathe operator or a piano tuner, both of which are very highly rated and important tasks, although lathe operation has suffered over the years from numerical control. The world moves on, and we should move with it.
Some 750,000 jobs are created through higher education in this country. Many of them are crucial to the levelling-up process, as it is now called, in terms of giving youngsters in the most deprived areas of the country the belief that they can do something different from their parents and grandparents. It is about breaking intergenerational disadvantage, which is why I commend my noble friend Lady Armstrong on drawing attention in her debate later today to the fact that areas of the country that previously benefited from traditional industries now suffer from the worst-quality education in the country and the worst expectation of what people there will do. It is not surprising that more people go to Oxford and Cambridge from London and the south-east because the education system in London and the south-east is, sadly, still much better than it is in the Midlands and the north. It is not surprising that when we tell people that university education might be too much for them or inappropriate for them, they might believe us.
We need a menu that enables young people to make the right choice, but that allows people who may have experienced the world of work and decided that change is an imperative driver for them to come back into higher education through lifelong learning, to re-educate themselves and be able to take on new challenges. Lifelong learning should be at the root of what we are doing, saying and investing in in relation to education.
I want to address a negative before coming to the positives. The negative has been the suggestion that somehow attracting overseas students to universities in this country is squeezing out domestic applications. Applications through UCAS from English students dropped this year by 1%. That is not surprising when people are told, despite the fact that they might face unemployment, that university is not for them. The noble Baroness, Lady Falkner, who chairs the Equalities and Human Rights Commission, raised a Question in this House about inequalities arising from overseas students coming to this country in large numbers. The Minister was honest, as she always is, and brave enough to say that there is no evidence whatever of that happening—and, of course, it is not. The number of overseas students, who now include EU students, has actually dropped, marginally. As university income has fallen and the challenges of research funding have grown, it is not surprising that universities have sought to attract overseas students to allow cross-subsidisation into crucial research, which we applaud all the time, such as into better vaccines and engineering for the future things that will transform our country, including on net zero. Yet in the next breath we condemn the idea of going out there and attracting students.
The Chancellor of the Exchequer said yesterday:
“Outside the US, we have the most respected universities”—[Official Report, Commons, 6/3/24; col. 843.]
in the world. They are respected by the rest of the world but not enough by people in this country. It is bizarre to hear the Chancellor applauding our universities and then hear his colleagues going around rubbishing them. It is absurd that you can put out through the Sunday Times, a highly respected historic investigatory newspaper, the notion that students from abroad were squeezing out domestic students and their applications, and for a presenter on GB News, Katherine Forster, to say that it made her blood boil. She is a really good example of why we need more people in higher education—they might actually be able to evaluate facts and make a critical thinking exercise on what they read or, in the case of GB News, what they see in their own programmes. They might, seriously, be able to lift their horizons of what we need to do for the future.
At my own university is the University of Sheffield Advanced Manufacturing Research Centre and its work on small modular reactors and the energy needs of the future. It has not just pure science and engineering but the social science and humanities which we will need for the creative economy of the future, which so many universities are applying themselves to. Universities bring a massive input to local economies, as anchor institutions and the real levelling up, with £272 million going into Sheffield Central alone. Why? It is because we have two universities. The average across each constituency in the UK is £58 million, which is still an enormous contribution to the well-being of local people and our future.
What do we need to do? Universities need to be rigorous in their quality and aspiration. Linking up further education and higher education is a no-brainer. Ensuring that we take overseas students out of the migration statistics is a no-brainer, as it would stop silly arguments. We should ensure that we can reshape our longitudinal studies to get a real understanding of what students from higher education are actually doing in local communities, whether they are part-time or self-employed. Let us have a commission on the funding of higher education for the future—that has lost its way at the moment. Above all, we should ensure that quality research, world-class teaching and the importance of valuing our universities are put front and centre. Stop knocking what is such a valuable asset to our country; let us invest in a world of tomorrow.
Lord Patten (Con)
My Lords, of the three key words in the very thought-provoking Motion before us, and following the provoking and thought-provoking speech we have just heard from the noble Lord, I intend to home in on productivity linked to how degree apprenticeships can fit into getting us a more productive country. It is one of the great mysteries of the age, at least to me, why in productivity we are such laggards. We all know the unsatisfactory trends that we have, but answers there are relatively few, despite an avalanche of words from multiple think tanks. Heaven only knows, we have enough think tanks in this country now, yet we still seek an answer as to why our productivity lags.
The ingredients in all this must include a bit more than just a lack of private and public capital invested and skills developed to explain away the faltering footprint of our national productivity. For sure, many universities do a good bit towards helping productivity; we even have the British Academy weighing in now with its thoughts. But even if some do not seem to be at the peak of productivity, quite a few universities do not seem to be good at managing their own affairs; hence we have at the moment a growing number of universities, unfortunately and sadly, reporting gravity-defying deficits and growing redundancies, sometimes with the closure of valuable units. Something is not quite right in the way that universities are running themselves.
Degree apprenticeships could do very much to help. They are making good progress. They were a great idea when first mooted, but they are not in the numbers necessary to correct the balance between traditional universities and higher education. There is of course that vocational tinge to it all. I do not say that everyone goes to university to follow a particular career or develop a vocation, but it is important that young people are taught to think. None the less, why has there been such slow development of degree apprenticeships?
Some people think that the very term “apprenticeship” is off-putting—that it gives the wrong image or perception. Maybe cultural conservatism is also there in our universities. Certainly, some schools do not think that an apprenticeship is quite what their brightest and best should be doing. I think that is wrong. Families also sometimes think the same for their own: that the brightest and best should not be going to apprenticeships. Maybe there is a poor selling of that concept, yet degree apprenticeships can be deeply satisfying for individuals and can greatly help productivity.
One example to illustrate this is of a young friend who started off in a school which was in measures and got into a sixth form later on. She came from a home that had never sent anyone to university before and where they are very proud of her. She told me that, despite getting the grades predicted and a place thereby in that excellent university, the University of Nottingham, she had decided that she was going to reject it. I asked why, slightly surprised, because the school had wanted her to do this. She said, “I don’t want to do that freshers week and have all that piling up of debt. I want to do something, so I want to go into a degree apprenticeship”. She has done that and gone into a big corporation, where she is very well treated and monitored. She is moving around its departments and, in the meantime, doing an excellent course of study with the partner university to that corporation.
That is certainly a choice which more people should be encouraged to take and are not being encouraged to take at the moment. We need more action on that front. Not only that, but this girl is now earning north of £20,000 per year. She has no debt whatever and is paying no fees. She can have a nice time and, by living at home, can make a contribution to the bank of mum and dad from the money that she is earning, rather than asking mum and dad for money. That might be a particular case, but I was very impressed with what she said and how she said it.
I hope very much that my noble friend—perhaps in her closing remarks, or if not then in a letter later—will explain what more the Government think they can do to promote degree apprenticeships.
Baroness Blackstone (Lab)
My Lords, as my noble friend Lord Blunkett said in his excellent speech, higher education has been one of the UK’s most successful sectors and we must do all we can to sustain this success. Our universities have a well-earned international reputation, which we must not sacrifice because of underfunding. Our target must be nothing short of excellence, so that the great contribution they make to our national economy and to their local communities continues.
In the last decade, we have witnessed so many aspects of public life in this country threatened by lack of resources and failures in government policy, so I say to the Minister: please do not let this happen to higher education. I include in HE not just universities but FE colleges, which are so often neglected but provide much needed vocational and technical degrees and diplomas close to their students’ homes and workplaces. I hope that the Minister will not forget them when she responds to this debate.
I start with funding. I do not think the fees charged to undergraduates can be ratcheted up again to reflect inflation, because the debt that graduates face is already high and some will take a lifetime to pay it off. While high fees have not been a disincentive so far for most students, they have for some, notably part-time mature students. Instead, government grants to universities to support their teaching and various innovations in their economic contribution should be restored.
It was a mistake to move entirely to a fee-based system of financial support. UUK is right to ask for direct support from government and for strategic funding. The Government need to have the means to incentivise activities in universities which will support economic development in the regions where they are located. This will provide additional funding for knowledge exchange schemes, bringing together HE, businesses and non-commercial partners. More grant aid where possible, and matching funding from commerce and industry for start-ups and spin-offs, would be welcome.
There also needs to be a more strategic approach to lifelong learning, with government funding to support part-time short courses, backed by public and private sector employers, as a route to bedding in improved contributions to greater productivity by universities. There is a need, in a rapidly changing economic climate, including with the spread of AI, for graduates to update their skills and knowledge throughout their working lives. There is good evidence that having a degree helps graduates to be more productive, but there is still more to be done to enhance lifelong improvements in their productivity.
Universities can make a substantial difference to the well-being of their local and regional communities. Again, this can be enhanced by kick-start funding from government to tackle low levels of innovation and applied research in the local economy. Do the Government accept the UUK recommendation that university enterprise zones in specific geographical areas, working to increase growth and innovation locally, should be expanded to all universities? If they do, what are they doing about it? I ask the same question about enterprise and opportunity hubs, which UUK also advocates on a national basis so that all universities and colleges can reach out to places which have been left behind.
These examples are ways of enhancing the fundamental role of universities in national growth and productivity. Many of them also relate indirectly to levelling up by helping reduce the divide between prosperous and disadvantaged communities. There will be many young people and adults in the poorest areas of the UK with the potential to benefit from higher education who never make it. The disastrous decision to close all schools for such a long time during the Covid epidemic will increase these numbers. It is incumbent on higher education to reach out to schools and FE colleges to promote more access to university courses. There should also be government funding allocated to universities, for example, for running remedial courses for new entrants needing such help. If levelling up is to become a reality, the number of mature students who missed out as school leavers must be restored.
I end by asking the Government not to neglect the humanities and social sciences by attaching too much priority to STEM subjects. Teaching and research in the humanities and social sciences is also vital in a knowledge economy.
Baroness Garden of Frognal (LD)
My Lords, I thank the noble Lord, Lord Blunkett, for initiating this debate and for his wise and challenging words. I cannot think of a time or an issue on education where I disagreed with him. I am delighted to highlight the contribution of higher education to our national well-being and our national pride.
Higher education plays a critical part in the economy as well as in education. The media sadly seems to prefer tales of dissent—impoverished and bullied students, and overworked and underpaid staff—to tales of success and new thinking. We must never allow negative messages to shout down the immense success of the sector in which we all have confidence. Of course, we regret the issues highlighted by the noble Lord, Lord Patten.
Our universities continue to feature among the best in the world. For a small island, that is no mean achievement. It is in part because we have had very many centuries of encouraging and supporting education. We have historically valued higher education and need to continue to do so. In many towns and cities, universities and further and higher education colleges—as the noble Baroness, Lady Blackstone, said, we must never forget the colleges—are major employers. They generate millions of pounds in research and knowledge exchange and their community engagement involves staff and students volunteering in support of local projects. At Edinburgh University, for instance, its community grants scheme gives £618,000 worth of support to more than 220 community projects and its 9,200 academics generated a massive £3.2 billion impact from research and knowledge exchange activities. Many other universities can boast of similar activities and benefits to their local communities.
The Civic University Commission, led by the wonderful Lord Kerslake, claimed that when the first civic universities were set up at the end of the 19th century it was clear that, as well as aiming to rival the two ancient universities in the depth and quality of their learning, they also had specifically local concerns. They had a sense of the places in which they were located, as well as limitless intellectual ambition. That must not be lost in red tape and administrative bureaucracy.
Universities and colleges up and down the country offer opportunities for learning and working. Those in disadvantaged parts of the UK are prime sources of levelling up. Universities such as Lincoln and Lancaster have vastly increased the status of parts of the country not well served by wealth.
We know that the creative industries make a major contribution to our finances. Creativity is vital to society. The University of the Arts London, with its six component colleges, for instance, has over 22,000 students from 130 countries. It is not only a source of world-beating research, but a place where true international relations flourish. Another such place is Goodenough College in London, an educational charity that provides residential accommodation for talented British and international postgraduates and their families studying in London. It runs a programme of intellectual, cultural and social activities that aims to provide students with an international network and a global outlook—a true example of global Britain.
Adult learning in wonderful institutions such as Birkbeck and the Open University support lifelong learning, which is particularly vital for those who have never found inspiration at school but have the intellect and motivation to study for their own benefit and the benefit of society. We know that adult education is beset by lack of funding. Part-time learning misses out on grants and even loans. The lifelong learning entitlement may go some way to remedying this, but it is by no means certain that adults will wish to take on debt in order to study. Can the Minister say whether there is any evidence that adults are being enticed back into study by the entitlement?
There has been a sharp decline in part-time higher education in recent years. This is exacerbated by regional disparities. Numbers have fallen much faster in the north-east than in London, for instance. There should be much better incentives for those in low-participation areas. The Universities UK report Jobs of the Future found that more than 11 million extra graduates will be needed in the future to fill jobs in computing, engineering, teaching and health. Universities are evolving to meet such a challenging demand, but it is a challenge.
However, we must not assume that university is right for everyone. Students whose talents and interests lie in practical achievements should not be pressured by schools and parents into university when apprenticeships and vocational and professional qualifications may suit them better. Schools still do not brief their pupils on non-university routes. This is partly because they are still measured on GCSEs, A-levels and university entrance. But talented young people can feel adrift at university if that is not where their motivation lies.
As the noble Lord, Lord Blunkett, said, we must never suggest that universities are only for certain people. It takes courage to be the first in your family to go to university and we should be proud of the young people from disadvantaged backgrounds who choose university as a route out of underachievement and into opportunities for studying, socialising and learning, which will lead them to good jobs. Universities do so much to raise the status of their towns and cities, and to bring investment, enterprise and employment. We must take note of all they do and support their endeavours.
Baroness Wolf of Dulwich (CB)
My Lords, I congratulate the noble Lord, Lord Blunkett, on securing this important debate, at a time when the university sector is under enormous pressure. He has rightly drawn our attention to the role of universities in growth, productivity and levelling up. This reflects the increasing tendency, at all levels of education, to discuss what we do in terms of the economy.
Universities have always been about training people for jobs, long before growth was seen as a central concern of Governments. Universities are indeed central to growth, productivity and levelling up. Without them, we would not have the levels of innovation and wealth that we do, or the genuinely improved opportunities—although they are not as great as they might be—for our young people.
I will use my short time in this debate to utter some words of warning and concern about our enthusiastic embrace of universities as engines of growth. There is a real danger, not just in this country but throughout the world, that a simplified understanding of this relationship and of what it means for government policy is a genuine threat to university excellence. It leads Governments down a path which does not deliver what they hope it will and leads to some reactions that we might wish to avoid.
Especially once the wonderful years straight after the Second World War came to an end and productivity suddenly started to be problematic—rather than something that just seemed to be happening and growing right, left and centre—Governments, intellectuals, academics and politicians cast around for some way of turbocharging growth. All over the world, they came to the conclusion that education was the answer—the more people we educated for longer and the more graduates we had, the more the economy would grow. It is true, I repeat, that without a highly qualified and well-educated population you cannot have a modern and innovative economy. But what has also happened is that we have all been rather disappointed: all over the world, there has been a huge increase and expansion in graduate numbers, but somehow growth has remained anaemic and productivity is not going in the directions we want.
All over the world, as the university sector gets larger and larger, resource per student tends to go down, and there are also some really concerning results: degrees become barriers to entry and you cannot get a job that you used to be able to get without a degree unless you have one. We should be very aware of this danger because it is starting to have a real impact on the way that Governments deal with the university sector in ways that threaten its ability to deliver the innovation and the type of education that we all value.
Australia, for example, having failed with one set of very complicated differential fees, is now about to introduce another set, which will apparently be based on the future contributions to the economy of different degrees—so this is not just a British disease. It has been true here, in the United States and elsewhere that we have focused more and more on whether individuals earn a lot from a particular degree. This is being hard-baked into our regulatory and accountability regime. We should take a deep breath and ask whether this is sensible, any more than it was sensible to believe that you would guarantee an uptick in economic growth simply by increasing the number of students.
Individual salaries depend on a very large number of things. They depend, for example, on whether you go into an occupation like nursing, where your wage is set not by a market but by a Government. They depend on which institution you went to and on the sort of occupation you go into. They also depend—this comes to levelling up—on where you are. You will not earn as much if you study in the north-east and stay there as if you study in the south-east and stay there—although actually you might be as well off, given house prices. But as a tool for steering, regulating and changing the higher education system, the way we have doubled down on the idea that we must look at whether a degree delivers growth—and that, if it does, it will deliver salaries—is very concerning. As well as celebrating the role of universities, I hope we will pay careful attention to some of the unfortunate consequences of focusing too much on growth.
Lord Howarth of Newport (Lab) [V]
My Lords, Britain’s universities remain a jewel in our crown. It is enormously to the credit of academics that it is so, considering the headwinds against which they are struggling. They have been casualties of the Government’s chronic mismanagement of the economy, as well as their peculiar unwillingness to invest in education. When you have such precious assets as 25 universities in the world’s top 200, you should treasure them. When your universities are essential for imparting the intellectual skills needed in the workforce of the future, you should invest in them without being paralysed by arbitrary fiscal rules.
Improving skills is one of the Government’s levelling-up missions, yet higher education is only a shadowy presence in the policy. That is bizarre. Universities are major economic presences in their communities and regions. They are important sources of employment. They are partners for business in teaching, research and innovation. They are routes for social mobility and cultural beacons. Without their existence, the plight of post-industrial areas would have been even worse. We cannot claim that universities are the solution to Britain’s productivity problem—productivity remains stubbornly poor—but the productivity challenge is multifaceted, and improving skills is only one part of what is needed.
The Government think they can get away with making students shoulder too much of the cost of the university system. They shifted the weighting of funding substantially from taxpayer-funded grants provided by funding bodies to tuition fees to be repaid by students via the loan system. Then, in 2017, they froze tuition fees for domestic students, which accounted for half the funding of universities, at £9,250. They are still frozen at that level, albeit that since then universities have faced large rises in energy costs, borrowing costs and general inflation. In 2022 the NAO found that the proportion of HE providers with an in-year deficit had increased from 5% in 2015-16 to 32% in 2019-20. The IFS has reported that spending on teaching resources per student was 18% lower in 2022-23 than in 2012-13. We are in an unsustainable situation whereby the level of fees is insufficient to fund tuition in many disciplines, yet it is seen as a poor and even unaffordable deal for many home students.
The unpredictability of the student loan system is a worry for students and for observers of the national finances alike. We know that a significant proportion of loans will not be repaid. Meanwhile, many graduates are experiencing hardship, having subsidised courses other than their own and now, with the interest rate as high as 7%, effectively paying high marginal tax rates over longer periods. I hear increasingly of clever young people who ought to have a university education saying to themselves that the financial implications mean it is not worth while. If the Government are looking for a reasonable concession to the junior doctors and a way to recruit more nurses, they could consider a scheme of loan forgiveness.
The frantic recruitment of international students has been the consequence of freezing tuition fees for domestic students. Although there is great merit in our universities attracting outstanding students from around the world, it is a different matter when they are driven by fiscal pressure to resort to flogging degrees to foreign students, charging shamelessly high fees and, in some instances, debasing academic standards through dubious agency and franchising arrangements. With the changes to the visa rules for dependants this January, the Home Office has made it harder for them to attract international students, and numbers are already tumbling.
Not all the woes of our universities have been visited on them by the Government; some are self-inflicted. Most worrying is the tendency to suppress freedom of speech, and the witch hunts against academics who hold views on, for example, gender issues or the history of empire that are considered by other academics to be heretical. Such attitudes and behaviours are contrary to the proper idea of a university, and feeble academic leadership should not allow them to prevail. Universities should rise higher than the street fascists. If a university is not a place where students and scholars are confident to explore and put forward ideas that may be unfashionable or unpopular, it is not only liberal education that is at risk but liberal society and liberal politics. It also weakens the willingness of the taxpayer to invest in such institutions and the economic and social benefits that they can confer.
Lord Willetts (Con)
My Lords, I congratulate the noble Lord, Lord Blunkett, on initiating this debate. Finding myself standing opposite him in the Chamber responding to a debate that he has initiated reminds me of when I was his shadow in another place years ago. It reminds me in particular of an incident when, as I spoke, I could see the then Secretary of State looking increasingly uncomfortable and challenged. I thought, “My points must be getting through”—until I realised that what had actually happened was that his guide dog had been sick on the Floor of the Chamber of the House of Commons, which he kindly pointed out was the guide dog’s assessment of the points I was making as shadow Secretary of State. So I hope to manage a little better this time.
It was an excellent intervention with which the noble Lord began. He was bringing all of us, from all sides of the House, to recognise the qualities and strengths of our higher education system. It is not perfect, it faces real challenges and there are areas where it is underperforming, but the system as a whole is a good one. I am a bit uncomfortable when it is always praised in terms of “four of the top 10 universities” or “25 in the top 200”. That way of assessing the quality of our higher education system does not reflect the truth that it is a very diverse system. There is no one way of being a good university. Of course, those globally respected, research-leading universities at the top of the league tables are excellent, but there are other ways of being excellent. You can be an excellent vocational university, focusing on skills requirements in your area. You can be a university that is excellent in teaching, focusing on teaching rather than research, as the tech initiative of my successor, the noble Lord, Lord Johnson, brought out. We must celebrate the strengths of a range of universities doing different things, and I hope that the Minister in her remarks at the end will make that point.
The system also needs greater diversity, and we have already heard about degree apprenticeships, which are a very welcome addition to the range of higher education provision. My noble friend Lord Patten asked about their growth. The truth is that they are funded—nothing comes for free—to the tune of almost £30,000 out of the apprenticeship levy. They are reported to be taking approximately 20% of the apprenticeship levy and, in turn, Ministers report that the apprenticeship levy is 99% spent. It would be very interesting to hear from the Minister, if degree apprenticeships are to expand, how this growth will be funded and whether it will mean, if it remains a charge on the apprenticeship levy, that other forms of apprenticeship, often more focused on young people, suffer by comparison. While they are an excellent initiative, there is some uncomfortable evidence that, for any given discipline and compared with conventional university courses, degree apprenticeships appear to be more socially selective, less likely to take people from deprived backgrounds and less likely to take young people—more than half of those on degree apprenticeships are over 30. What more we can do to extend access to degree apprenticeships is something on which I think we would like to hear more from the Minister.
Finally, as time is tight, I will just comment on the—as always—interesting observations from the noble Baroness, Lady Wolf. There is not simply a utilitarian defence of higher education. Again, it was the noble Lord, Lord Blunkett, as Secretary of State, who commissioned an excellent research exercise on the wider benefits of learning that is still yielding findings and results to this day. When we at the Resolution Foundation—one of those think tanks—recently did work on mental ill-health among young people and economic inactivity, we found that young people who had been to university were still quite likely to suffer mental ill-health. However, it looked as if having been to university made them more resilient. They were more likely still to be in work even while suffering episodes of mental ill-health than people who had not had that opportunity. So there are wider benefits of higher education that extend beyond those that are subject to immediate economic calculation and this debate is an opportunity to repeat the point.
Lord Londesborough (CB)
My Lords, it is a pleasure to follow the noble Lord, Lord Willetts, and two former Secretaries of State for Education. For my part, as an employer, I will focus on higher education and productivity, which of course is a two-way street.
It is no coincidence that the UK’s flatlining productivity since 2008 comes at a time when we have seen the education budget fall in real terms per pupil over the past 15 years. Low economic growth reduces our ability to invest in the education and training of our future workforce. This vicious cycle has brought us to the point where we now spend more annually on debt interest payments than on our entire education budget. Strangely, the Chancellor did not flag this up in yesterday’s Budget Statement.
I speak today from the perspective of an entrepreneur rather than an educator or Minister. I was an employer for 30 years, and many of our best long-term hires came from graduate trainee schemes, both here in the UK as well as in Asia and the US. I now back and advise early-stage businesses and, for many, the biggest single hurdle to growth is the supply of talent in this country, particularly graduates. This is not so much about the calibre of graduates as about the supply of work-ready graduates with relevant degrees, as there is a damaging mismatch between skills and vacancies.
We have large swathes of graduates in jobs not requiring a degree. The IFS reports that, outside London, this number has risen to 42%, up from 31% back in 1993. That is a red flag for productivity. Graduate vacancies are now falling, as is the wage premium, as students rack up a cumulative debt of £200 billion, the majority of which the Government admit will never be repaid.
For the two-thirds of graduates across the UK who go on to high-skilled employment, their median salary is reported to be £11,000 higher than that of non-graduates—but that average is much lower due to the skewing effect of very highly paid professions. To achieve that differential, graduates will have devoted three to four years to further education on little or no pay and racked up an average debt of £45,000 each—as will the other third who, despite graduating, never secure high-skilled jobs.
These numbers are symptomatic of an economy failing to keep pace with the major and, some would say, unsustainable expansion in the number of graduates over the past 30 years. Put bluntly, we do not create enough high-skilled jobs. Given this context, universities should focus much more on preparing their students for the workplace and not just on graduation. Too many graduates leave university with no clear idea of what they want to do, with the result that many stray into a series of short-term jobs that fit poorly with their skills and character.
So what can be done to address this fundamental mismatch? I have just three quickfire observations on which I would welcome the Minister’s response. First, I advocate that one-third of an undergraduate’s curriculum should be devoted to their future employment prospects, developing life skills that apply to the workplace, receiving comprehensive careers advice and gaining hands-on, relevant work experience.
Secondly, we need radically to reduce the number of students taking degree courses with poor outcomes, lack of academic rigour, high dropout rates and poor employment prospects. We need to be more discriminating.
Finally—this is a problem of both supply and demand—we need much greater involvement from employers, both public sector and private sector, in helping educate students about professional life as well as scaling up graduate traineeships and internships.
This country has an extraordinary array of young talent, but it needs much more specific advice, training and guidance if we are to turn our students into engaged, happy, well-paid and, above all, productive workers.
Viscount Chandos (Lab)
My Lords, I thank my noble friend Lord Blunkett for securing this debate and for his compelling introduction. I am tempted to say, “The prosecution rests, m’lud”, and sit down, but your Lordships will be disappointed that I shall try to add a few points to those made by my noble friend.
The array of former Education Ministers, vice-chancellors and other higher education experts speaking today reminds me, in making my declarations of interest, of my status as an enthusiastic amateur in a field of professionals. I am a trustee of the drama school, LAMDA; chair of an apprenticeship provider, the Credit Services Association; and an external member of the investment committee of Worcester College, Oxford, of which I am an alumnus. I am also a member of the Industry and Regulators Committee of your Lordships’ House, which published its report on the OfS and the challenges for the HE sector last summer. I look forward to debating that when the usual channels have agreed a date.
I shall try to avoid repeating the data and arguments already set out compellingly by other speakers. Higher education is vital to growth, productivity and levelling up, as well as to non-economic benefits, such as health, life expectancy, crime reduction and the general strengthening of civil society, as cogently argued by the noble Lord, Lord Willetts, in the Economy 2030 Inquiry and touched on in his speech a moment ago.
The impact of universities
“on human and intangible capital is self-evident”,
as Jonathan Grant and Andy Westwood wrote for the Bennett Institute for Public Policy—self-evident, but perhaps hard to measure. That may be one reason why too much of the debate about higher education policy in recent years has focused on the more measurable economic benefits, nationally and locally, to the communities and regions in which universities are located. These are important and hugely welcome consequences of investing in HE, but does the Minister agree that there should be absolute clarity that the mission of universities and other HE institutions to provide UK students with the highest-quality higher education should be first, second and third at the heart of government policy?
Excellence in teaching and research costs money. We seem to have reached a position, as my noble friend Lord Howarth has already said, where student fees and living costs are becoming higher than many young people can take on responsibly, while UK undergraduate fees are increasingly inadequate to fund the universities’ provision for teaching these degrees—a circle that will need somehow to be squared by future Governments.
In the meantime, I will end by briefly raising the disparity of wealth and endowments among UK universities. The US system is different, but it is worth remembering that, among the private universities—Harvard, Yale and Stanford—there are endowments of $40 billion to $50 billion, generating a return of $2 billion to $2.5 billion a year for those universities. But even among the public universities in the US, there are 50 with endowments of over £1 billion. In the UK, Oxford and Cambridge each has endowments that are 16 times greater than those of the next best-endowed university, Edinburgh. I do not for a moment want to discourage donations to either Oxford or Cambridge—to my former college, Lindsay Owen-Jones has been a recent, enormously generous benefactor—but we need to level up and find ways in which to assist the many other excellent universities to boost current and capital fundraising through match funding and other initiatives.
Lord Storey (LD)
My Lords, first, I thank the noble Lord, Lord Blunkett, for securing this debate and for his thoughtful comments.
I look back with affection to those heady days of the 1980s and 1990s when the higher education sector in general and the university sector in particular were going through a period of transition and growth—the establishment of new universities and the evolution of polytechnics to university status—although before that the Wilson Government had formed the Open University, which was a pioneering world first. It gave students of any age, background or, indeed, geographical location the chance to study for a degree. Its partnership with the BBC was quite unique.
We saw in the late 1990s how universities released their validating powers and other institutions became stand-alone colleges and/or universities. The higher education sector blossomed and flourished. In my own city, the University of Liverpool was joined by Liverpool John Moores University, and then Hope, Europe’s first and only ecumenical university, was established—joining together two former Roman Catholic colleges and an Anglican teacher training college. More recently, the Liverpool Institute for Performing Arts, Paul McCartney’s and John Lennon’s former grammar school, has become a performing arts higher education college.
The universities complement each other, as they have worked together on many collaborative projects. The old notion of town and gown is very much still alive in Liverpool; for example, in working together with Liverpool City Council on a science park.
Britain is home to 137 Nobel Prize winners, second only to the United States, a fact that should be of great pride to us all. We are a land of academic progress and innovation. Our physicists pioneered atomic and nuclear physics and our economists designed the liberal world that we live in. Today our universities keep producing world-class, ground-breaking research that shapes our country and our world. Research briefings and research papers of our doctors and professors have inspired policy at the United Nations, the White House and the European Commission, as well as leading innovation in some of the largest global corporations, in the fields of engineering, information technology, artificial intelligence, medicine and much more. But the impact of research carried out in our universities is not limited to the grandest history-shaping excellences. For every history-shaping innovation, there will be millions of attempts by dedicated students and individuals contributing each day to moving the frontier of knowledge one step ahead. These are the students and people we need to support as, without them, there would be no innovation.
But what now? Student fees have not gone up in eight years, and costs have doubled. Student numbers are down, and some universities are facing recruitment problems, as we have heard. Universities are facing severe financial difficulties. Staff salaries have declined, and the brightest and the best are regularly poached from overseas, particularly by universities in the USA. Many staff are now appointed only on fixed-term contracts—try getting a mortgage when you are on a fixed-term contract. Like all of us, universities have been harshly hit by the pandemic and the recent higher costs of living crisis. Universities reporting year-on-year deficits jumped by 5% from 2015-16 to 32% in 2019-20, according to Universities UK.
We need to financially support our universities to keep producing the high-level research that we pride ourselves on and to keep leading in the world of innovation. The plummeting value of domestic tuition fees is forcing universities to rely more and more on overseas students—that is a good thing, as we heard from the noble Lord, Lord Blunkett, but they are increasingly hard to recruit. We need to recognise that foreign universities have increased competitiveness and are gaining in popularity. Europeans were once charged domestic fees in UK universities. Now, facing triple the yearly tuition fees, most of them are diverting to new destinations, with the Netherlands scoring highest. Others are finding US universities better value for money, as fees in American colleges have almost come to match tuition fees in the UK.
All this is not to say that our universities are perfect. They always need to support and value the best staff, and the staff always need to put the best interests of the students first. As a society, we need more than ever to have high-level skills, to support our higher education sector and to see a new renaissance in learning and research.
Lord Johnson of Marylebone (Con)
My Lords, the Chancellor may not have used his Budget speech to tackle the funding crisis but, as the noble Lord, Lord Blunkett, said in his excellent speech, at least he mustered some praise for our universities. That was a welcome change of tone at a time of often scepticism, bordering on hostility, towards higher education.
There is of course nothing new in the criticism that too many go to university—we have heard it again today—or that too much public money is wasted on low-value courses. Such attacks have been a constant in the history of the expansion of higher education and everybody is well used to it. I do not want to fall into the trap of complacency, and I certainly agree with the noble Lord, Lord Londesborough, that there is a case for cracking down hard on pockets of poor provision in the sector, which affect a minority of students on a minority of courses. We want to ensure that value for money is produced by this system.
However, I do not think that we should succumb to a general cynicism about higher education; nor do I think that we should return to a system of rationing higher education and limiting access to the number of students who progress from level 3 to levels 4, 5 and, particularly, degree level 6. Why do I say this? I say it because there is a very well-established skills bias in knowledge economies. Job creation takes place overwhelmingly in roles requiring graduate skills and, in the UK, this is happening at a time when we are already suffering from marked skills shortage, where we do not have enough highly skilled individuals to fill many vacancies. Our real problem as an economy is skills shortages. This really matters if we care about levelling up. Unless we continue to develop the pipeline of highly skilled human capital, we will see increasing inequality as wages rise more rapidly for those whose skills will be in stronger demand. We must not lose sight of how imbalanced our economy is. The FT recently calculated that, if you strip London out of our GDP per capita figures, the average Briton is worse off than the average resident of Mississippi, the poorest state in the United States.
The second reason is that we are living in an era of unprecedented technological disruption. As the noble Lord, Lord Blunkett, said, there are massive changes ripping through our economy due to two big waves of innovation; the first is a digital innovation wave, built on AI, supercomputing and automation; the second is a deep-science innovation wave based on biotechnologies and nanotechnologies. Our ability to surf those waves depends on the absorptive capacity of our firms and the adaptability of our people.
We are already seeing massive labour market disruption. As the noble Lord, Lord Blunkett, said, these powerful technologies, a number of which are converging at the same time—not just AI, but big data, cloud computing, the internet of things, virtual reality and blockchain—are driving change in all aspects of our lives. As the World Economic Forum’s Future of Jobs report found in its survey of employers, 44% of workers’ skills are likely to be disrupted over the course of the next five years. It is only the quality of our education system that will determine whether the UK will benefit from these innovations and whether it will be able to join the ranks of countries developing the next technologies. The most highly innovative knowledge economies around the world—look at South Korea, Israel, Japan and Canada—have boosted tertiary participation rates to well above ours, to the order of 60%, 70% or even more. Our ambition should be to join this vanguard of knowledge economies, not to give in to the dismal voices calling for student number controls that will hold back our productivity, widen inequality and throw sand into the engines of social mobility.
Lord Bilimoria (CB)
My Lords, last year, as chancellor of the University of Birmingham, I spoke at the QS world university rankings conference in India. I spoke with pride as, with less than 1% of the world’s population, the UK has four of the top 10 universities in the world. The latest QS rankings show Cambridge and Oxford second and third. I declare my interests as an honorary fellow at Sidney Sussex College, Cambridge; an ambassador for the Cambridge Judge Business School, where I am conducting research as we speak; and a Bynum Tudor fellow at Kellogg College of the University of Oxford. His Majesty the King is a Bynum Tudor fellow, as was Archbishop Desmond Tutu. I am also a visiting fellow at the Centre for Corporate Reputation at Saïd Business School in Oxford.
The QS rankings go further: 17 of the top 100 universities in the world—including the University of Birmingham, where I am proud to be chancellor—are British. This is fantastic, yet this Government have frozen fees at £9,250 for many years, so the real value of those fees is about £6,000. Inflation has meant that costs have gone up, but we are still meant to produce the best universities in the world with our hands tied behind our backs.
I thank the noble Lord, Lord Blunkett, for his brilliant opening speech and for initiating this debate. Universities UK states very clearly that:
“The higher education sector creates enormous economic impact across the country… contributing over £130 billion”,
that universities “support more than … 768,000” jobs, and that
“UK higher education providers … educated approximately 2.9 million students”.
This is a really important part of our economy. In October 2023, there was a report written as part of the Economy 2030 inquiry by the Resolution Foundation and Nuffield Foundation—the noble Lord, Lord Willetts, was also involved. It set out how higher education can improve productivity and drive economic growth, with four groups of benefits that higher education can offer individuals and society, including longer life expectancy, better health, higher earnings, less likelihood to be unemployed, lower crime rate, being more likely to volunteer and vote, more tax receipts and increased exporting. This is music to my ears.
Some 24% of students enrolling in higher education institutions in 2021-22 were non-UK. We now have over 600,000 international students—which I will come back to. Business and management is the popular subject, with 19% of all students studying it. I am patron of the Small Business Charter—I took over from the noble Lord, Lord Young—and we accredit business schools around the country with the Chartered Association of Business Schools to be able to teach SMEs. I am also on the council of the Help to Grow management scheme, which provides mini MBAs for businesses where they pay only £750. This is the value of our business schools.
The British Academy, in a report, said in relation to higher education entrepreneurship that many higher education institutions are incubating future economic disruptors across all disciplines. I came up with the idea for Cobra Beer when I was studying law at Cambridge University. The innovation mindset is foundational to UK higher education. Some 80% of UK higher education research is assessed as world-leading and internationally excellent. The return on investment for public and private R&D is estimated at 20%; the sector was responsible for 25% of UK R&D. This is amazing, yet we as a country spend only 1.7% of GDP on R&D and innovation, versus America’s 3.2%—just imagine if we spent more.
Just a week ago, Bhaskar Vira, the pro-vice-chancellor for education at the University of Cambridge, showed me the brilliant report The Economic Impact of the University of Cambridge, which sets out how the university contributes nearly £30 billion to the UK economy and supports more than 86,000 jobs across the economy.
Before I conclude, as co-chair of the All-Party Parliamentary Group on International Students, president of the UK Council for International Student Affairs—UKCISA—and a former international student myself, I must touch on international students. HEPI pointed out last year that international students bring in £42 billion to our economy. I remember fighting in this House in 2007 to bring in the two-year post-graduation work visa. It was brought in in 2008 by a Labour Government, taken away in 2012 by Theresa May as Home Secretary, and brought back in by Boris Johnson in 2021. Just look at how the number of international students has rocketed; yet this Government seem to have an anti-international student attitude—an anti-immigration attitude. We need to take international students out of the net migration figures. It would almost halve that figure.
This is the strongest element of soft power that we have in this country: 25% of world leaders have been educated at UK universities, 25% at US universities, and the other 50% across all the other countries in the world put together. Let us celebrate international students and celebrate our universities. Our universities are the jewel in this nation’s crown.
Baroness Chapman of Darlington (Lab)
My Lords, it is a pleasure to follow my friend the noble Lord, Lord Bilimoria, who speaks with such insight, enthusiasm and, I have to say, speed on this important topic.
Before I move on to the speech I had prepared, I want to say something in response to the contribution of the noble Lord, Lord Londesborough, which was very interesting and made points that we often hear. I was reflecting on my experience. I was the first person in my family to go to university—not just my immediate family, but my entire extended family. I took 20 years to pay back the debt I accrued. I have never had a job that would show up in an employment survey as a graduate job, but I learned things that have stayed with me and supported me throughout my life: how to read, how to analyse, how to understand a set of data, how to be sceptical, and how to appreciate how much knowledge there is out there in the world that I do not know. I learned so many things that will serve me throughout my life. I only wish that my own two children would go to university and have the same experience, but I am having no luck in persuading them just yet.
I am very grateful to the noble Lord, Lord Blunkett, for securing this debate. It really could not be more timely. He described a more arid future, as he put it, and the wasteful negativity that we have too often heard, I am afraid even from Ministers in the party opposite. As the need to grow our economy becomes ever more urgent, our universities are playing a crucial role. Universities could add even more value if they had a Government committed to working with them, not, as sometimes feels the case, against them. We have had a string of Bills, Ministers and appointments determined to involve universities in and, as I see it, co-opt them into culture wars. We have had the freedom of speech Act, the economic activity of public bodies Bill, the attitude to overseas students that we have heard referred to in this debate, and now the Science Minister using UK taxpayer money to settle legal battles after calling academics “extremists”. None of this helps harness the power of our higher education sector, which can do so much to help the UK move forward. Sadly, there has been no coherent strategy for this for years now.
I declare an interest as Chancellor of Teesside University, which is a northern powerhouse all on its own. It is global university based in Middlesbrough. It contributes just short of £148 million in GVA to the region each year, has over 2,000 apprentices on courses designed to fill regional skills gaps, and over 200 successful business start-ups, employing almost 800 people, have grown out of our Launchpad programme: we are doing our bit. Teesside University is not just a powerful engine of social mobility for individuals, which it absolutely is; it is an anchor institution for the region. Its mission is to transform lives and economies. It innovates, bringing new degrees that should be valued by anyone who claims to understand the modern UK economy, in areas such as games design. It is agile enough to try something new and stable enough to stick with it while it grows into one of the fastest, most exciting industries in the world—great jobs, global opportunities and a £7 billion a year industry. It is not just Teesside, although obviously we are the best at this; the same can be said for many other institutions up and down the country that are future-facing, innovative, entrepreneurial and delivering the 11 million extra graduates we will need to fill jobs in the UK by 2035.
When I was very much younger—about 25—I was at an event in Trimdon Labour Club where Tony Blair spoke. I am not going to do a Blair impression, though I can. He was talking about higher education, China and the UK as a global competitor. He said, “Look, the thing we all need to understand is that they are educating their population. They are no longer poor people riding around on bikes. The UK needs to lift its sights and invest in education if we are to compete on the world stage”. Those words are as true now as they were then, and have stuck with me ever since. We have a huge advantage in our long-established, high-quality higher education sector. What we need is a Government who recognise this strength and work with the sector to support and grow it. It is a sector that, like Teesside University, transforms lives and economies, harnesses the knowledge to tackle the world’s challenges, and will work in partnership with a Government who value it as the asset that it is.
Baroness Prashar (CB)
My Lords, I too thank the noble Lord, Lord Blunkett, for securing this important debate and for his very thoughtful and pertinent remarks, particularly about the role of education in opening minds and meeting aspirations. I was glad that the noble Lord, Lord Willetts, amplified that too.
I will focus on the university sector in all its diversity, and two interrelated issues affecting the sector: funding and international students. Our universities are a success story and one of our major assets. They are essential not only for education for education’s sake but as the bedrock of our science, research, innovation, creative output and much more. At present, universities face many challenges and unrealistic expectations. Some of them have been mentioned in the course of the debate. Of course these need to be responded to, but without making what I call inconsistent compromises. Otherwise, we are in danger of frittering away our comparative advantage and damaging our major asset. The comments of the noble Baroness, Lady Wolf, were pertinent in that context.
As we have heard, domestic undergraduate tuition fees, which are the main source of funding, have been frozen for the past decade. Meanwhile, inflation has driven up universities’ operating costs. To make ends meet, universities have become reliant on attracting international students. The recent negative and ill-informed rhetoric around immigration, and linking it to international students, has had the effect of reduced demand from international students, as shown by figures produced by Universities UK. Work by PwC shows that this could put four-fifths of universities in deficit. We have had what has been called a yo-yo approach to international students. We closed the post-study work route in 2011, reversed that in 2019, and now we are applying the brakes again, making it impossible for universities to plan ahead. This is the consequence of continuing to count international students as part of the immigration figures, thus creating a perception that they are a burden, which we all know is far from the truth.
Blaming international students, and not taking positive steps to present accurate information about the benefits they bring to this country, is disingenuous and not in our national interest. This is a policy failure for which we are making international students scapegoats and, in the process, hurting our universities and, in effect, shooting ourselves in the foot. Unless the funding issue is addressed, it will lead to cutbacks in research and affect salaries, learning and facilities. It also risks the potential for innovation and will blunt our competitiveness. Easing academic entry requirements for international students is not the answer; it will actually compound the problem.
In a very thoughtful paper published recently, Professor Shitij Kapur, the vice-chancellor of King’s College, argued that universities are trapped in a “triangle of sadness” between students burdened with debt, a stretched Government who have allowed tuition fees to fall far behind inflation and beleaguered staff who feel caught in the middle. He says that the fate of our universities cannot be left to the vagaries of the decisions of overseas students. He argues for inflation-related uplifts in student fees, as planned under the Theresa May Government, linked to quality, and he questions whether a single funding framework is suitable for all needs.
I am not suggesting that that is the only solution. We have had reference to the funding model; indeed, the noble Lord, Lord Blunkett, talked about a possible commission to look at funding. My fundamental point is that we need to address the question of funding if we are to reap the benefit of this national asset we keep talking about. If we want universities to continue to make a significant contribution, we need to address the question of funding universities and their sustainability. Therefore, I ask the Minister whether there are plans to settle the uncertainty around our policy with regard to international students and take them out of the immigration figures. Has any consideration been given to setting up a commission to look at funding?
Lord Norton of Louth (Con)
My Lords, I congratulate the noble Lord, Lord Blunkett, on securing this debate. I declare an interest as an academic at the University of Hull, mention of which gives me an opportunity to pay tribute to one of our alumni, the late noble Lord, Lord Cormack. I knew him for almost 60 years and his is a great loss to this House, to which he was dedicated.
It is difficult to train graduates for future jobs when we do not know what those future jobs will be. In the time available, I want to focus on just two contributions made by higher education. The first is the contribution made beyond the economic. As we have heard, higher education makes a massive contribution to the UK economy. Indeed, we rely on our universities to generate the research that will ensure we remain competitive in a global market. That economic contribution is essential to the nation’s well-being, but so too is the social contribution. Our universities are turning out not just economic units but well-rounded members of society. Higher education is crucial to personal development, something that benefits not just the individual but society. That is especially important at a time of social and economic stress, not least as a consequence of the pandemic, economic uncertainty and international conflict. For our citizens, higher education is a good in itself as well as a fundamental contributor to economic development. The Government tend to focus almost exclusively on the latter. Educating young people who are the first in their family to go into higher education is part of levelling up, but my point goes more widely than that. Spending on higher education is an investment for the nation’s future, not just the economy but the social health of society.
My second point relates to the value to the United Kingdom of the export of higher education. As the noble Lords, Lord Blunkett and Lord Bilimoria, have said, we benefit enormously from recruiting overseas students. Overseas students are beneficial in terms of what they contribute to the local economy while they study here—many local businesses are dependent on student trade—as well as the research undertaken at universities, especially at postgraduate level. Crucially, overseas students come to study here and then they go home. Returning home is often beneficial to their home country, especially in the case of developing nations. Indeed, we would make a greater contribution to developing nations by investing in bringing students here to study than by giving money directly to the governing regime. Their returning home also benefits the United Kingdom, both economically and politically. Foreign nationals who have been educated in the United Kingdom are more likely to trade with the UK than those educated elsewhere. That is the economic benefit. The political benefit, as the noble Lord, Lord Bilimoria, said, is in terms of soft power. We produce students who are well disposed towards the United Kingdom as a result of studying here. Many go on to hold major public positions in their home nations. At a time when our capacity to exercise hard power is decreasing, the capacity to exert soft power becomes even more crucial.
We therefore need to look at the benefits deriving from overseas students. Conveying the impression that they are not welcome is a massive exercise in self-harm, especially when we are in a highly competitive market. There are other nations, such as Australia, that invest heavily in recruiting overseas students. It will be a great help if my noble friend Lady Barran acknowledges this benefit and outlines what the Government are doing to maintain our share of the market. Without it, not only will our universities suffer but so too will the economy and the global clout of the United Kingdom.
Viscount Hanworth (Lab)
My Lords, it is a familiar aspersion that the scientific and technological innovations that occur in our universities are too slow in giving rise to practical industrial applications that might sustain our economic growth and prosperity. It has been suggested that much of the fault lies with the universities: the academics appear unwilling to become engaged in promoting the fruits of their research, which is a much less attractive activity than pursuing the research. I contend that much of the fault lies elsewhere. Britain’s industrial sector is so attenuated that it is hardly in a position to benefit from the fruits of applied research. Those fruits are gathered mainly by other nations.
There are abundant examples of this. It applies, in particular, in the cases of inventions that are capable of contributing to what is optimistically described as the green revolution. A tragic example concerns the battery technology on which electric vehicles depend. The lithium-ion battery was the invention of a British scientist, but the dominant manufacturers of batteries are in the Far East. There is an optimistic notion that, although we are severely behind in establishing British manufacturers of batteries, we are nevertheless in a good position to exploit future technical developments in this area. We are sponsoring academic research to this purpose. However, the support from the Government is pitiful. It is provided in research grants, which are small sums of money available for only three years at a time.
There is also a failure on the part of civil servants and others to recognise that much of any research effort is bound to run to waste. This accounts for the very stinting provision of financial support and the alacrity with which scientific and technological projects are cancelled. Often, they are cancelled at the very point when they reach fruition. An example concerns the British advanced gas-cooled reactor. It suffered a long and expensive process of development, but when the technology had been perfected it was abandoned in favour of an American pressurised water reactor, which is the Sizewell B reactor. We may be in the act of perpetrating the same folly by abandoning the small modular British reactor in favour of an American reactor for which we shall not have to bear the costs of development.
In Britain there has traditionally been an uncomfortable distinction between the arts and humanities on the one hand and science and technology on the other. This has been sustained by a distinction between a gentlemanly university education and a technical education deemed to be more appropriate to the working masses. This was reflected in the distinction between universities and colleges of technology.
The 1956 White Paper on technical education proposed the creation of 10 colleges of advanced technology, albeit that the number had originally been 25. This reflected the anxiety that universities were not adequately fulfilling the role of technical education. In the Robbins report of 1963, it was proposed that these colleges, which had been under the control of local authorities, should become chartered universities. The proposal was greatly welcomed by the Labour Party, which had decried the seeming class distinction between a university education and a technical education.
Of course, I applaud the removal of any such distinction. However, the change has been to the detriment of technical education. The erstwhile colleges of advanced technology and the polytechnics, which became universities in 1966, have abandoned much of their original mission. This is partly because they have been catering to consumer demand, but it is also for financial reasons. A course in the arts and the social sciences or a course that teaches commercial skills is much cheaper to run than a fully fledged technical or scientific course.
Our universities are suffering from perilous ill health. They are understaffed by academics who are severely overworked. The academics have lost a large proportion of their real income, and their pension rights have been severely affected by the disastrous investments of the universities superannuation fund. It has been raided on successive occasions to finance the early retirement of staff, in consequence of successive rounds of cuts.
Recently, a large proportion of the university staff were European nationals. Since Brexit, they have ceased to come in such large numbers. The temporary employment contracts, to which the majority of new university staff are subject, are not attractive to them. The income from overseas students is now set to decline. The exceptions are liable to be in departments of engineering and computer science, which continue to attract large numbers of foreign students. They will carry their skills back to their native countries, with which we may no longer be able to compete in economic terms.
All told, these circumstances evince a profound sense of pessimism.
Lord Mountevans (CB)
My Lords, I thank the noble Lord, Lord Blunkett, for this debate and congratulate him on his excellent introductory speech. In seeking to avoid what has already been said, I will focus on the important role the UK’s higher education sector plays in enhancing the UK’s business credibility and attractiveness to foreign businesses and investors, which is so very important. Like the noble Baroness, Lady Chapman, I intend to base myself on an area I know very well, so I am taking the City of London as a case study.
A recent City of London Corporation report shows that London and the UK ranks highest amongst international financial services centres in the access to talent and skills provided for companies. However, this should not be seen solely in terms of business, law or economics graduates. The wider contribution provided by the higher education sector is essential to maintaining the UK’s status as a place to do business.
The square mile, the heart of the UK’s largest business sector, financial and professional business services, is perhaps not well known as a location for higher education, unlike other parts of London such as Bloomsbury. However, in the wider area there are 70 universities and 130 research institutes. Many of these are business skills focused, such as City, University of London’s Bayes Business School, which is, inter alia, home to the Costas Grammenos Centre for Shipping, Trade and Finance. It offers, if I may mention a slightly specific personal involvement for a moment, in my view the world’s best master’s in shipping, trade and finance, and an excellent master’s in energy, trade and finance. The courses are heavily subscribed by the brightest and best internationally, but sadly with few UK students taking advantage.
The City is blessed with a world class conservatoire, in the form of the Guildhall School of Music and Drama, as well as the first institute of higher education in London, Gresham College. Gresham College is arguably one of the first iterations in Britain of levelling up, providing free public education across the arts and sciences since 1597. Gresham’s executors founded the college to bring the “new learning” to Londoners in English rather than Latin, the language of universities over most of Europe at that time. It was the first institute of higher education in London. The college adds immeasurably to the intellectual life of the square mile, enhancing it as a place to do business. Gresham was a trailblazer in promoting public education, being one of the first higher education establishments outside the ancient universities of Cambridge and Oxford. The college continues to trailblaze: since 2001, all Gresham College lectures have been made available online, and since 2007 they have been uploaded to YouTube, once again increasing public access to education and pre-empting the Covid development of online streaming of events. Lectures are free and open to all.
Similarly, the Guildhall School of Music and Drama enhances wider London’s attractiveness as a business destination. As well as providing world-famous actors and musicians, its production arts department provides the West End and the world with experts in theatre crafts such a prop making, set design and stage lighting, which feeds our creative industries. The school is ranked number one in arts, drama and music by the Complete University Guide 2024, and as one of the top 10 performing arts institutions in the world in the QS World University Rankings 2023.
For international companies thinking about where to base their European office, London’s cultural offer is an important consideration. However, as we have heard, the sector faces challenges. The graduate visa route is an important draw for international students to the UK; however, removal of this route could imperil the attractiveness of courses such as the Guildhall’s music therapy MA. Graduates looking to use their skills in hospitals, SEN schools and care homes would struggle to secure a skilled-worker visa due to their work being based on multiple part-time contracts, making it extremely difficult for them to meet the financial threshold.
The current Lord Mayor of London, Alderman Professor Michael Mainelli, has sought to show the links between business and higher education through his theme of “Connect to Prosper” and the appointment of the first Lord Mayor’s Fellow at City University, where he is rector. I would encourage the Minister and business community to give greater recognition to the core role that the higher education sector plays in making the UK an attractive business destination.
In conclusion, I have a few words on professional qualifications and training—we have not spoken very much about this, other than in terms of apprenticeships. There are many chartered institutes, such as chartered accountants, ship brokers, et cetera, setting courses and examinations for specialists in London, across the UK and indeed around the globe. These professional bodies contribute immeasurably to professionalism and, importantly, business ethics.
The current Lord Mayor has collaborated with CISI on the 695th Lord Mayor’s ethical AI initiative, introducing a certificate in artificial intelligence. This has been taken up phenomenally across the world. It is hoped that other professional bodies will introduce related certificate courses.
Lord Parekh (Lab)
My Lords, I begin by thanking the noble Lord, Lord Blunkett, for securing this debate and congratulate him on introducing it with such wisdom and insight.
We have been talking about universities; they are funny institutions that keep evolving over time. They began with Aristotle’s and Plato’s academies; in the Middle Ages we had the theology-based institutions; in the 19th century, with the rise of capitalism, they underwent further changes and now, under the impact of modern technology, they are undergoing even further changes, with the result that it becomes rather difficult to talk about “the university”. I am fairly confident that the university will continue to respond to contemporary technological changes, and one of the things I expect it to do over time—in fact, it is already doing it—is to make sure that lectures, for example, which it has concentrated on delivering, are taken over by one or two places in the world and the contents are then broadcast to other parts of the world. So I do not have to go to Harvard to listen to lectures on philosophy from a professor there; I can listen to them on tape in my own study, or my fellow students can listen to them in the University of Bombay or Delhi. In which case, why do you need a lecturer in the university? Why do you want a person to be engaged in lecturing, taking up time that could be freed up for other activities? This means that universities 10 years from now will be very different institutions.
However different the institutions are, there will be some roles they will have to continue to play and cannot avoid playing—in fact, more so than before. We have been talking about universities’ contribution to the economy. That is only one small role that they play. As the noble Lord, Lord Norton, pointed out, they are also custodians of civilisation. University is a place where people think about the world around them and comment on the values that inspire people and the way in which their society is declining, which they cry out against. Universities are unique places where individuals are paid to withdraw themselves from the world around them and comment on that world.
So universities play multiple roles, one of which is to become centres of international excellence. International students come to our universities because our universities were born 500 years ago and have developed in a manner suited to the modern age, which has not happened in India or China, or elsewhere—their universities are growing slowly and are not fully developed. In some cases, they are rather poor and corrupt, hence their students come to us. Rather than resenting their presence and talking about them in a very dismissive way, we should welcome them.
This obviously raises problems, because the whole world wants to come to our universities—not because we are a great people but because we had the historical opportunity to start much earlier than them. Given this, what do we do? Naturally, we want to be able to open our doors to them, but, at the same time, we cannot throw them open completely, because what happens to our people? Given the asymmetry between the two different streams of students coming in, we need to find ways of coping with it. There are various ways and that is what we should concentrate on, not lambasting international students who are paying enormous sums of money to come here. Rather, we should talk about reserving a minimum number of places for our own students, or other ways in which this can be done. This is what is being done in France, Germany and the United States.
The other point I want to make, which I am sure the noble Lord, Lord Blunkett, wanted us to explore, is about levelling up, which I think has been ignored. Levelling up is a concept which has become quite famous since 2019, but I am not very comfortable with levelling up. It is like meritocracy: you pick up people and bring them up to a certain level, and that is what you are supposed to do, but who fixes what level they should be brought up to? If you can level up, you can also level down, and so students become objects of manipulation.
I suggest instead that we should create a system where students are able to realise their full potential and do whatever they want to do, be that through a university degree, acquiring higher skills in a polytechnic, or through other ways. I therefore suggest that we continue to talk about our students in a very respectful way, making sure that they leave university as well-rounded citizens.
Lord Shipley (LD)
My Lords, I thank the noble Lord, Lord Blunkett, for enabling us to have this extremely important debate. As someone whose main career was with the Open University, and then as a council leader, working closely with local universities in the north-east, I recognise the huge contribution that they make to their local economies. As Universities UK said in its Jobs of the Future report, more than 11 million extra graduates will be needed to fill jobs in the UK by 2035, in industries such as computing and engineering, teaching and education, and health. The latest developments in AI mean that there will be a 10% net increase in jobs that require a degree over the next 20 years. This comes at a time when the UK economy is stagnating.
However, the UK’s net zero economy grew by 9% in 2023, according to a report by the Energy and Climate Intelligence Unit and the CBI. This tells us that growth can be achieved if research and investment lead it. Universities, as so many speakers have said, are central in doing that. Some 90% of universities embed entrepreneurship in their degree programmes, and 80% of university research is categorised as world leading or internationally excellent. It must be built on.
In 2021, according to Universities UK, 21,000 spin-out companies were in existence, together with start-ups and social enterprises. We must build on that too. However, two weeks ago, on 21 February, there was a two-page advertisement funded by the UK Government in my regional morning paper, the Journal. The headline read: “Levelling up is happening here in the north-east”. That is good, and I welcome it, but the word “universities” never appeared, and it should have done. Indeed, a report by the Bennett Institute for Public Policy, based at Cambridge University, argued that the role of universities was not adequately recognised in the levelling up White Paper. I hope that the relevant departments across Whitehall will recognise that situation.
When I led Newcastle City Council a number of years ago, we developed very close working relationships with the two universities in the city and the regional development agency, One NorthEast. Our investment policies were aligned to buy the huge Newcastle breweries’ vacant site in the city centre. The council assembled the land and dealt with the planning side. One NorthEast provided capital and development support, and Newcastle University aligned its research and spin-out ambitions on the site. Multimillion pound cutting-edge investments have followed. We need more of that, and it is done through partnership work.
A lot has been said about overseas students. I agree entirely with what the noble Lord, Lord Blunkett, said: they are crucially important. They pay high fees and enable fees for UK students to be lower than they otherwise would be. They generate resource in our university cities and towns, particularly supporting the retail sector. We know that many overseas students are entrepreneurs and will set up businesses generating jobs. Overseas students have been vital for growth. The OBR has just reported that half of our projected growth will rely on immigration. I agree with the noble Lord, Lord Bilimoria, that we should leave overseas students out of ONS figures, to be counted in immigration figures only if they stay.
In conclusion, I am absolutely convinced that universities are central to growth and productivity gain. I support the remarks made by a number of noble Lords, including my noble friends Lady Garden of Frognal and Lord Storey, about the importance of part-time higher education to the economy. A report by London Economics found that the Open University has a total economic impact of £2.8 billion across the UK, a benefit-to-cost ratio of £6 for every £1 spent. We should never forget the importance of part-time higher education and lifetime learning. We need to invest in our universities.
Lord Vaizey of Didcot (Con)
My Lords, it is a pleasure to take part in this debate. I congratulate the noble Lord, Lord Blunkett, on calling it. I agreed with every word he said, and it took me back to when the noble Lord, Lord Bragg, initiated the arts debate. We rely on our elder statesmen on the Benches opposite to remind us, again and again, of what is valuable and good in our country.
It is a great pleasure to follow the noble Lord, Lord Shipley, not least because I spent some time in the north-east recently, working on a project with Newcastle University and four other universities called Creative Fuse, bringing together technology companies and creative companies. In fact, I think I am getting an honorary degree from Newcastle University—I am not sure if I am allowed to say that in public. I spent some time as Culture Minister understanding the incredible work that Newcastle and Gateshead have done on culture, turning Newcastle and Gateshead into a tourism site. I am sure that the noble Lord, Lord Shipley, played an absolutely vital role in that.
That leads me to universities. I could make a whole speech on the incredibly important role that our universities now play in culture. They were the saviours of culture as I set about slashing the culture budget. They supported many museums and performing arts institutions. The university of my friend, the noble Lord, Lord Bilimoria, is supporting the archive of the British Museum, and universities all over the country do that.
I could do a challenging speech on higher education. There is a part of me—probably based entirely on huge ignorance—that regrets that the university marketplace is not more competitive, with a variety of lengths of degrees and a variety of levels of tuition fees. However, I am sure I would be put right if I dared to venture into that territory.
I am now a stuck record, having followed the brilliant speeches of the noble Lords, Lord Shipley and Lord Bilimoria, as well as the remarks of the noble Lord, Lord Blunkett. In fact, the noble Lord, Lord Bilimoria, came on my yet to be award-winning Times Radio show to defend overseas students. He broke off from a lunch in Paris, and was incredibly articulate at a moment’s notice, to defend overseas students. I want to follow him, and the noble Lords, Lord Blunkett and Lord Shipley, in doing the same.
We have around 600,000 overseas students in the UK at the moment. That is pretty much the number that we predicted in 2013. There is not suddenly a surge in overseas students, and we have been through Covid and Theresa May to get to the figure that was predicted. However, there is no real policy on overseas students and no established consensus on how many overseas students the UK should host. If we had the same proportion of overseas students as Australia, we would have a million studying in the UK. We should be proud of the fact that, alongside Canada, Australia and the United States, we are the leading nation in the world for higher education for overseas students.
The number of potential eligible students around the world is growing by about 4% a year. If this was a business, you would be salivating at the prospect of increasing your customer base every single year, and thinking, “How do we attract more?” It is a myth that international students displace domestic students. In fact, the number of domestic students at our universities—84%—is the highest level it has ever been.
However, we need to update the data on how we measure overseas students because students are changing their behaviour and becoming more sophisticated. If you want to study for a master’s degree overseas, you apply for three or four different visas in different countries to ensure that you can move seamlessly into the one that accepts you, which could be in one of three or four countries where you have made an application. We tend to measure overseas students on the basis of those to whom we have granted visas rather than those who have come into the country to study. One of the reasons why we are popular is that we offer a shorter master’s degree than most of our competitors.
We need to think carefully about which countries are sending overseas students. A few tend to dominate at the moment—India, China and Nigeria. We might need a broader range of countries to hedge our bets in the future. However, we cannot be complacent. We might find it very easy to be rude about overseas students and put forward these silly arguments about how it is immigration by other means or how they are being attracted only because they are cash cows, but we should remember that many other countries are dying to have our kind of higher education market. For example, Turkey is emerging as a key player in the higher education market.
I wanted to take part in this excellent debate simply to make the point that overseas students are a massive asset for our country, a massive part of our economy and, as the noble Lord, Lord Bilimoria, said so eloquently in his brilliant speech, a massive part of our soft power.
Lord Watson of Invergowrie (Lab)
My Lords, my noble friend Lord Blunkett has done your Lordships’ House a service by introducing this important debate. I thank him for that.
Levelling up is a term that is almost incapable of meaningful definition. However, it was a key pledge made by the Government at the last general election to reduce regional inequality in England and it is fair to ask what has happened since then. The £3.6 billion towns fund was the main initiative, yet the Government have had to admit that less than a fifth of the projects approved to improve towns across England have been completed. Last year we learned that councils were having to scale back or freeze levelling-up projects because of soaring costs and that the Department for Levelling Up, Housing and Communities was returning almost £2 billion of housing money to the Treasury, unable to find projects to spend it on.
Of course, inflation and interest rates have made it difficult for some projects to make progress, but the Government have failed to respond, instead asking local authorities to reduce their ambition. Surely, the very last thing required in the pursuit of increased growth, productivity and levelling up is less ambition. However, yesterday’s Budget provided evidence that the Government have redefined levelling up to their own advantage. The Chancellor highlighted future investments in Buckinghamshire, Cambridge and Surrey—all of which happen to include battleground seats for the upcoming election. Even that well-known deprived area of Canary Wharf is to be the recipient of government support.
The economic impact of higher education institutions was graphically illustrated by my noble friend Lord Blunkett in his powerful opening speech. Research by London Economics found that the estimated total benefit to the UK economy from 2021-22 first-year international students over the duration of their studies was more than £40 billion, while the estimated total costs were around £4 billion, meaning a benefit-to-cost ratio of 10:1. You would think that an economic impact of that level would be hard to ignore, yet the Government are making a determined attempt to do just that: as my noble friend Lord Howarth said, visa rules were changed at the start of the year so that international students could no longer bring dependants to the UK unless they were studying a postgraduate research course or a course with a government-funded scholarship.
This will hit many universities hard, given their reliance on international student fees to offset the fact that domestic student fees have not risen for a decade. Ironically, in their levelling-up strategy of 2022, the Government highlighted the importance of higher education institutions and their role in boosting local economies, but it seems that this crucial role has been trumped by the need to appease the right wing of the Conservative Party.
I want to highlight a part of the higher education sector which has a unique, vital and too-often undervalued role in levelling up—the Open University, to which the noble Lord, Lord Storey, referred. Flexible lifelong learning through part-time higher education is crucial to improving the UK’s economic growth rate. Supporting and encouraging adults who are already in work to reskill and upskill will be critical to increasing productivity and filling skills shortages in growth areas of the economy. Flexibility is essential in allowing people to access higher-level skills in the area where they live by enabling them to fit their studies around the demands of work and family. The sharp decline in part-time higher education over the last 15 years has led to a big decrease in the number of adults aged 21 and over accessing higher education and therefore caused regional disparities in higher education participation to widen.
The higher education participation rate of working-age adults aged 21 and over in England is now 30% lower than it is in the rest of the UK, largely due to the ending of the maintenance allowance and other support that is available to full-time students. Part-time distance learning is critical to widening access, supporting social justice and levelling up by allowing disadvantaged adults and those from higher education cold spots to access higher-level qualifications in their local area. That is evidenced by the Open University. More than half of its students begin their studies without the traditional entry qualifications demanded by other universities and more than a quarter come from the most disadvantaged areas in the UK.
The lifelong learning entitlement will offer a real opportunity to tackle many of the barriers to people studying flexibly in England. It will not be introduced until next year, but the removal of some of the restrictions on how additional funding entitlements for reskilling later in life are used will significantly improve flexibility. The positive impact of the lifelong learning entitlement could be enhanced by extending maintenance support to all part-time students, including distance learners, either through an extension of maintenance loans or the introduction of targeted maintenance bursaries. This has had a transformative impact in supporting flexible learning in Wales and those lessons need to be learned in England, if not by this Government then certainly by the one that will follow them.
Lord Freyberg (CB)
My Lords, as the last speaker before the Front-Bench speakers, I also congratulate the noble Lord, Lord Blunkett, on initiating this important debate.
In the brief time allotted, I will focus on how design and technology education contributes to national growth and productivity. In an era when innovation is the driving force behind progress, the role of art and design in shaping our educational landscape cannot be overstated. According to research from the Design Council, the design economy increased by 73% between 2010 and 2019, which is twice as fast as the UK GDP. It has 1.97 million workers and a gross value added of £97.4 billion, more than two-thirds that of the financial services sector in the UK. The design economy encompasses industries such as product and industrial design, advertising, graphics, fashion, digital design, architecture and urban planning, as well as designers working in finance and marketing. Design skills are also used by non-designers in jobs such as civil engineering. Its multidisciplinary approach benefits all sectors of society, especially those addressing larger challenges such as achieving net zero carbon emissions, where 80% of a product’s environmental impact is established at the design stage.
It is therefore hugely worrying that the pipeline of designers to industry risks running dry in the wake of the collapse in design and technology GCSE numbers. Over the past decade, the number of students pursuing a GCSE in design and technology, which the majority of designers have, has decreased by 68%, raising concerns about a potential shortage of talent in the profession. This trend was noted by the House of Lords Education for 11-16 Year Olds Committee, chaired ably by the noble Lord, Lord Johnson, which looked at secondary education more broadly. Its report observes that
“creativity is increasingly valued by employers across all sectors of the economy”,
and that
“the creative industries contributed £116 billion to the UK economy gross value added and grew faster than the economy as a whole”
prior to the pandemic. However, it goes on to note that there has been a
“general decline in opportunities to develop creativity across secondary education”,
as well as
“some academies … using the flexibility they have over their curricula to drop national curriculum arts subjects, such as art and design”.
According to several witnesses, school accountability policies that promote traditional academic study over more creative learning are mostly to blame for the drop in possibilities for students to study creative and artistic topics throughout the 11 to 16 phase. The committee’s recommendations include lessening the focus on the Government’s “knowledge-rich” approach, which it claims has led to
“an overburdened curriculum that necessitates narrow teaching methods such as rote learning and ‘cramming’ subject knowledge”,
and moving away from an excessive emphasis on “traditionally academic study” at the expense of creative learning.
A study in 2022 by the Education Policy Institute on the state of design and technology highlights many factors that have corresponded with the significant decrease in uptake. Between 2011 and 2020, the number of DT teachers plummeted by half, from 14,800 to 7,300, as the Government failed to reach their recruitment targets. The All-Party Parliamentary Group for Art, Craft and Design in Education found in its Art Now inquiry report that:
“Sixty-seven per cent of art and design teachers … surveyed reported that they were thinking about leaving the profession … Four out of five art and design teacher respondents reported that wellbeing and workload were … the two biggest disincentives to stay in teaching and that these had worsened since the pandemic”.
Equally alarmingly, students and parents often prioritise fields of study that are perceived to offer better job prospects and financial stability. The perception that design and technology may not lead to lucrative or stable career paths can discourage enrolment in such programmes. Because design and technology has proven to be a critically important GCSE subject for students to study at the 16 to 19 level, if we are not careful there will not be a talent pool ready to be developed at higher education level. This trend is underscored by the fact that fewer than 2% of people who did not study DT for their GCSEs went on to study the subject later in their education. For this reason, calls to update the curriculum to make it more engaging and relevant are to be encouraged. Children who lack the desire or opportunity to begin studying DT early in life are far less likely to pursue the subject at a higher educational level. Neglecting to nurture this significant talent could seriously threaten its future. As Minnie Moll, the CEO of the Design Council, says:
“We need to re-design nearly every aspect of how we live our lives to tackle the climate emergency”,
and therefore it is critical that we engage with this issue now.
Lord Wallace of Saltaire (LD)
My Lords, this has been a very interesting debate from which I have learned a lot. We thank the noble Lord, Lord Blunkett, for introducing it; I am sorry that he did not say more about the quality of Sheffield’s own universities. I have visited both the University of Sheffield and Sheffield Hallam University; they have some really superb scientific laboratories, and they are acting as a motor for the regeneration of industry in that region. Sheffield also has one of the best politics departments in this country—dare I say it, possibly even better than Hull’s. We need to persuade people that Oxbridge is not the only place to go; they should get out there and go to the other excellent universities that we have around the regions.
There is still an overconcentration on Oxford and Cambridge. I note that a Liberal Democrat councillor in Cambridge has pointed out that Cambridge cannot expand much further because there simply is not enough water to support the larger activities it wishes to have. I note that the Government seem to give a high priority to a direct Oxford-Cambridge railway line, but a vital link across the Pennines would bring together Manchester, Leeds, Hull and others across the north. If levelling up is important, our regional universities have a key role to play in that, and we need the infrastructure as well. My children both work in research-intensive universities. My son stayed with us last night on his way from Edinburgh to San Francisco for a life sciences conference. If you are in that sort of world, you have to travel and you need good communications. If you say to someone, “You really should come and visit Leeds or Hull, but it will take an awfully long time to get there, even if you fly to Manchester Airport”, that is not going to help that university compete with Oxford, Cambridge and the south-eastern golden triangle.
We have superb universities in the north, the south-west and Scotland. The teaching-intensive universities are also very important to regional regeneration. As your Lordships know, Saltaire is part of the Bradford metropolitan area. The University of Bradford plays a key role in bringing back what was, at one point in the 19th century, one of our richest cities but has now become one of our poorest.
Partnerships with further education colleges are also important. It happens that one of Bradford’s further education colleges is based in Saltaire and I watch its teachers struggling with poor resources and poor salaries. I recognise that, if our universities are to flourish, they need not only enough well-qualified staff but technicians. We have a gross shortage of lab technicians across the United Kingdom at present, so this is one of the categories in which people must be attracted from overseas. Therefore, continuing education and bringing people back to work that they have missed is another very important part of what our universities do. I am proud to say that one of the best researchers at my son’s current lab came back from five years of child-rearing, on a charity’s fund helping women to return to university life. That is the sort of thing on which we need to focus if we are to reskill the whole of our workforce.
The noble Lord, Lord Blunkett, talked about the underlying anti-university tone that one hears from some parts of our right. It is part of the infiltration of the right wing in Britain by the radical right in the United States. I recall reading an op-ed in the Telegraph some months ago, which said that our universities are systemically left-wing and indoctrinate their students. That is nonsense and I am sure the Minister agrees. Apart from anything else, a large number of our university staff are not even British, so are not involved in that sort of left-wing indoctrination.
It is deeply unfortunate that this tone is coming back into British politics. It works through the Government. The Higher Education (Freedom of Speech) Act, which we passed last year, imposed a number of restrictions on freedom of speech within universities. The Economic Activity of Public Bodies (Overseas Matters) Bill, now before the House, makes a number of further incursions on university autonomy. We will be examining this in Committee in a week or two. The dismissal of experts, and of reasoned argument and evidence, is to be resisted at all costs, including by people who work for systemically left-wing foundations, such as the Resolution Foundation. I am sure this is part of the deep state that Liz Truss warned us against.
Research and innovation are extremely important. It is extremely important that we do not keep narrowing what is allowable to research to that which has an immediate and obvious pay-off. I am just reading Katalin Karikó’s book on her work, for which she has now been given the Nobel Prize. In her early years at the University of Pennsylvania, she was regarded as the “mad transferable RNA lady”.
I also remember a dinner with a professor of nanotechnology at Oxford, who was a few years older than me—we had sung together as boys—at which he assured me that nanotechnology had no possible commercial application whatever. Three years later, his son-in-law discovered a way to make injections without piercing the skin and the entire family became extraordinarily well off. We need to maintain research in the sciences, even if we are not quite sure where they are presently going. That is the path for the future.
As a number of noble Lords have said, we also need to talk about reskilling in a world in which whatever we learned between the ages of 10 and 23 will be out of date and irrelevant by the time we are 50. Since our children will have to go on working until they are 70, they will need to go back to university, with universities providing executive education, evening education and part-time courses.
If I am allowed to include the social sciences, I was asked at a dinner at an Oxford college last week whether I could justify the teaching of politics and international relations in universities on an academic scale—I should say that this was by a leading scientist. I could say only that I have trained a number of members of the British Diplomatic Service, people who work in the City on international issues, and students from abroad, and that it seems that teaching them about how to think, and how to understand that others do not necessarily think the same way as them, is a necessary part. I have a vivid memory of being asked by Boeing whether the LSE would give it an executive training course for some senior managers. We discovered that it had no idea that the rest of the world did not think like people who were born in Kansas. That is a justification for social science, in passing.
Financial crisis has been mentioned several times. We all have to recognise that, as the noble Lord, Lord Howarth, remarked, the long-term prospect for universities is of financial unsustainability and that, unless we get away from a model that depends on fees which no longer pay for the courses, and more and more overseas students, some of our universities will be in great difficulty. Those who say that tax cuts are the most important thing have to take this on board when thinking about the future of the country. That includes uncompetitive salaries, since our universities are in a global competition in which academics move from one country to another. I now note that some of the academics I know are moving from Britain to Germany, the Netherlands, Scandinavian countries or, of course, the United States.
Above all, we should never take the continuing success of our universities for granted. The noble Baroness, Lady Wolf, commented that they have always been training people but, in the 19th century, it was for the Church and the law, while German universities were training people for the sciences and engineering. Look at what happened to the British economy compared with the German, given the higher quality of German universities then. We could find ourselves in a similar position in the next 15 years if we are not careful. That is why we have to nourish our universities and ensure that they play their part in national economic growth and regional levelling up.
Baroness Wilcox of Newport (Lab)
My Lords, I am delighted that my noble friend has brought this debate to our Chamber today. I commend him for the decades of work he has dedicated to the pursuit of better educational opportunities for all. I have the distinction of having been a serving teacher under his stewardship of the portfolio: prior to devolution of education to the Welsh Government in 1999, I had two years of working for the dynamic Secretary of State, now my noble friend Lord Blunkett, who was determined to ensure higher standards in literacy and numeracy and the introduction of the inspirational Sure Start programme, bringing together early education, childcare, health and family support. Unfortunately, this model was disbanded in England in 2011, but I am pleased to say that we kept it in Wales, under the banner of Flying Start. It is still running today, helping the most disadvantaged children and supporting their parents.
I cannot cover all the excellent points made by my noble friend, but some of his most salient are about an holistic approach to the young people of the future, getting them into the right place and giving encouragement. Higher education is indeed for them. It is about breaking the cycle of disadvantage, and lifelong learning is indeed at the root of this.
Many noble Lords have already commented on how higher education institutions play a critical role in driving innovation, producing a skilled workforce and facilitating regional development across the nations and regions. By operating sensitively and in close connection with the places and communities in which they are situated, universities have a distinct role to play in intraregional equality. They can serve as crucial social and cultural infrastructure, offering spaces, services and structures that foster community cohesion and strengthen social and cultural ties, as noted by my noble friend Lady Blackstone, and humanities are indeed a vital area of study.
When I taught for many years at Hawthorn High School in Pontypridd we gained the status, through a series of collaborations, of a university school. For many of our pupils, although the University of Glamorgan—later the University of South Wales—was physically situated in their community, it was as alien a structure to them as any other building in the town. Through various joint schemes and use of the campus facilities, including a wonderful radio studio, it gradually dawned on our pupils that the university was a place to continue their studies after leaving school, and that they could—in most cases, and as I was—be the first family member to go to university.
Universities provide a strong return on investment. We have an uncertain future ahead for our economy and labour market, and high-skilled jobs will be essential to guarantee the United Kingdom’s success. Demand is growing for individuals to be equipped with higher-level skills, as discussed by my noble friend Lord Howarth of Newport and the noble Lord, Lord Johnson of Marylebone.
London Economics estimated, based on the 2021-22 academic year, that the economic footprint of higher education providers contributed 768,000 full-time jobs, £71 billion of gross value added, and £116 billion of general economic output. This does not take into account the wider economic benefit of higher education on productivity, innovation from world-class research, increased wages and so forth. I am sure that my noble friend Lady Chapman demonstrated the value of her university education with so many erudite and insightful comments; I have no doubt that her sons will eventually be persuaded by her to attend university.
The Government report in July 2023 on higher education set out certain reforms, such as improving access to level 4 and 5 courses, and reducing fees for foundation courses which are classroom-based. Some issues that resulted from the report were that, in terms of limiting recruitment to certain courses, academics argued that these courses are accessible for disadvantaged students and important for social mobility and supporting the local economy. Labour argued that basing the outcome of courses on earning potential was limiting, and would restrict opportunities for disadvantaged students.
Many commentators have highlighted the lack of reference to universities in this Government’s levelling-up agenda. It has been reported that building a university in a town is the
“best way to level up a locality”.
There is a pool of graduates, many jobs, and a large influx of spending.
Education is at the heart of Labour’s mission to spread and expand opportunity. From our earliest years, through to learning or retraining as adults, gaining knowledge, skills and qualifications and exploring our interests and abilities enables us to build the lives that we want and the society we share. There was an excellent reminder by my noble friend Lord Watson of Invergowrie of the depth, breadth and success of the Open University in lifelong learning.
Today, the best education that our country has to offer is not available to every young person. The opportunity to learn and train as an adult is limited and available to too few. Our mission to spread opportunity means both enabling everyone to access the opportunities that excellent education brings and giving everyone opportunities throughout our education system.
Our world-leading universities and the research they undertake should be a source of pride and are one of Britain’s great strengths. The 2021 Research Excellence Framework found that the vast majority of UK university research was either “world-leading” or “internationally excellent”. University spin-outs, which commercialise this innovation, can directly drive up economic growth. However, we lag behind countries such as the United States in generating and scaling spin-outs. A Labour Government will track spin-outs from universities with a dashboard to identify what is working and where there are barriers. As recommended by Labour’s start-up review, we will work with universities to ensure that there are a “range of options” on founder-track agreements, helping boost spin-outs and economic growth.
Universities are anchor institutions and, at their best, are civic actors working with partners across local and regional communities to respond to the needs of that place. We welcome the work of the Civic University Network to establish peer review learning to support and expand the work of universities in responding to the needs of their local communities.
Will the Minister say whether limiting recruitment on certain courses reduces the accessibility of university education for disadvantaged young people? As I said earlier, universities are central to breaking down barriers to opportunities for young people, by exposing them to new communities, new people and new experiences, as I saw with my pupils when they engaged with university life. It is therefore, as many noble Lords have mentioned, a shame that the levelling-up agenda gives little recognition to the effect that universities and colleges have on local areas. Why do the Government neglect due recognition for the levelling-up qualities of universities and not want to incentivise more young people to take part in higher education? It is a wasted opportunity, and one which we will hope to redress. Our desire is to build on the legacy of the previous Labour Government’s target for 50% of young people to go to university to reverse the trend of declining numbers of adults participating in education and training. We will press on and ensure that the ambition of any young person to pursue higher education regardless of background or geography is realised.
The Parliamentary Under-Secretary of State, Department for Education (Baroness Barran) (Con)
My Lords, I join noble Lords in congratulating the noble Lord, Lord Blunkett, on securing this very important debate and thank him for the way he introduced it. I underline how both personally and on behalf of the Government I absolutely share his aspiration that there should be equal opportunity for every young person to access the benefits of higher education. I am not sure whether I am meant to declare this, but I am the slightly bemused recipient of an honorary degree from the University of Bath.
I thank all noble Lords for their contributions to this important debate. Our world-leading higher education sector plays a pivotal role in driving economic prosperity, creating employment opportunities and supporting the local communities that are the foundation of our levelling-up agenda. To reassure my noble friend Lord Willetts, I say that the Government accept that there are definitely different models of higher education. Indeed, we are investing in a number to encourage this diversity. We had a great example from the noble Baroness, Lady Chapman, regarding Teesside University and some others. I also absolutely agree with my noble friend Lord Norton of Louth that there is a wider social good that universities bring to their students and more widely to their communities.
As we have heard from noble Lords this afternoon, England’s higher education system already stands at the forefront globally, and it is imperative that we sustain this position. We should be proud that more than 40% of UK adults have achieved level 6 qualifications equivalent to a bachelor’s degree or above, surpassing other G7 nations and exceeding the OECD and EU averages, although I hear my noble friend Lord Johnson’s aspirations to go further. We continue to invest in our higher education system. Our latest reforms are introducing stringent controls to ensure that higher education courses deliver positive outcomes for all students and for taxpayers.
The noble Lord, Lord Blunkett, and the noble Viscount, Lord Chandos, talked about the importance of the quality of courses and I think a number of noble Lords, including the noble Baroness, Lady Chapman of Darlington, criticised the Government for some of the language used about the range in their quality. I would say from talking to universities that they share our view that it is incredibly important that we maintain quality in our higher education sector. That is hard to do—I absolutely recognise the pushback from noble Lords—but if we were to have evidence of poor-quality courses, that would risk besmirching the reputation of all our universities, as well as impacting on international students and the soft power to which noble Lords alluded.
Reference was made to the report in the Times. I suppose that the nuanced version of the balance of our great institutions and where we are focusing to ensure that quality is maintained does not make such good headlines.
We also recognise the central importance of technical and further education in delivering the key skills needed for economic growth. The Government’s reform agenda, outlined in the Skills for Jobs White Paper and subsequent legislation, aims to strengthen this sector by putting employers at the heart of post-16 skills through an integrated offer that includes T-levels, higher technical qualifications, apprenticeships—including, of course, degree apprenticeships—and improved support and guidance. The noble Lord, Lord Londesborough, referred to a number of those points in his remarks about the importance of links with employers. We have really tried to weave that through all our skills reforms.
I hope that the noble Lord, Lord Freyberg, is reassured a little by a number of the T-levels, which directly address some of the points that he raised. We will introduce T-levels in craft and design, and media broadcast and production, from September this year. There is, of course, a digital production design and development T-level as well.
My noble friend Lord Patten made the case strongly for degree apprenticeships. My right honourable friend the Secretary of State would certainly agree with him vehemently, given her experience as a degree apprentice. I will come in a moment to respond to my noble friend Lord Willetts’s points about the funding of degree apprenticeships going forward.
Our comprehensive reforms are supported by a substantial investment of £3.8 billion over the course of this Parliament. Specifically, £185 million in 2023-24 and £285 million in 2024-25 will address recruitment and retention challenges faced by colleges offering high-value technical, vocational and academic programmes—something which the noble Viscount, Lord Hanworth, was concerned about. This investment ensures that higher and further education training aligns with employer needs and empowers individuals to enter the workforce, progress and develop new skills continually through their lives. This skills development is imperative, because we know that one-third of labour productivity growth can be directly attributed to skill level improvements. Enhancing our workforce’s competence will help drive economic growth right across the country.
The noble Baroness, Lady Blackstone, asked about progress with the university enterprise zones. She will know that in October 2023, the Government invested £60 million in the regional innovation fund, which is obviously about aspiring to similar outcomes in driving regional business engagement and growth through knowledge exchange. But we have a number of pilot university enterprise zones: 24 of them were set up between 2015 and 2019 and are currently being evaluated for their impact.
Turning to research and development, higher education providers contribute significantly to the UK’s current R&D efforts by delivering a massive proportion of the UK’s current research and development expenditure. Our universities deliver 77.5% of the UK’s non-business R&D and innovation activities, which is significantly more than in other comparable countries. For example, in France the figure is 59.8%, in Germany it is 55.2%, and in the United States it is 46.5%.
The noble Lord, Lord Wallace of Saltaire, made the very wise point that R&D should not be seen only in terms of its immediate pay-off. One of the things that university R&D does is stimulate private investment. This is incredibly important for growth. Public spending on R&D is at its highest-ever level, and we are fulfilling our commitment to spend £20 billion per annum by 2024-25, in the knowledge that every £1 of public expenditure leverages double the amount of private investment in the long run.
This record wider investment is a key part of how the Government are delivering the long-term change to ensure that our country has the brightest possible future, growing the economy and improving opportunity for all. This most recent investment builds on the £137 billion we have invested in R&D across all parts of the UK in the last decade.
As noble Lords have illustrated, we are home to a world-class research community. We have thriving technology and life sciences sectors, excellent green skills and a fantastic creative sector. Those sectors help us lead Europe in terms of investment, particularly in relation to science and technology. We are focused on ensuring that we have the right skills for the future, the right conditions for start-ups and scale-ups, and the right regulatory environment that supports innovation and long-term business confidence.
We know that we have ground to make up compared with France, Germany and the US on productivity. Although the global financial crisis triggered an international productivity slowdown, the UK suffered a greater slowdown than some of those nations. Our investment in research and development, our reforms to higher technical education and our drive to increase participation in degree apprenticeships will all drive the change needed to fill this missing middle in our skills landscape and improve our productivity. My noble friend Lord Johnson of Marylebone referred to this.
Employers are demanding level 4 and level 5 skills to fill vacancies, yet only 4% of people have a level 4 or level 5 qualification as their highest qualification by the age of 25. Higher technical qualifications, approved to provide the skills employers need, will help to improve the prestige, profile and uptake of these valuable skills.
On funding growth in degree apprenticeships, which my noble friend Lord Willetts asked about, we are providing an additional £40 million in the next two financial years to support providers to expand their offer and improve access for young people and disadvantaged groups to these valuable programmes. Overall, investment in the apprenticeship system in England will increase to £2.7 billion by 2024-25. As I know my noble friend knows, 65% of all apprenticeship starts so far this year have been at level 2 and level 3, with level 3 remaining the most popular level, accounting for 43% of all apprenticeship starts.
The noble Baroness, Lady Garden, asked about evidence of encouraging adults back into education. Of course, it is too early to see the impact of the lifelong learning entitlement, but we can see tens of thousands of people taking our skills bootcamps, particularly in future-facing skills such as digital and data.
Levelling up was the focus of the noble Baroness, Lady Wilcox of Newport, and the noble Lord, Lord Watson of Invergowrie. Despite the noble Lord’s remarks, levelling up remains at the heart of the agenda to build back better after the pandemic and to deliver better productivity for every part of the UK. As noble Lords know very well, ability is evenly spread in education but opportunity is not. The department’s focus on levelling up differences in the quantity and quality of human capital between different parts of the country is essential; we know that this is the single most important factor in driving differences in productivity over time.
The noble Lord, Storey, spoke eloquently about the importance of skills, and he is right. To help improve people’s lives and boost the economy, the Government’s skills mission sets out an ambition for 200,000 more people to complete high-quality training in England each year by 2030. This includes 80,000 more people completing courses in areas of England with the lowest skills level. We want to make sure we are raising skills levels in the places they are needed most, so that more people have the skills that they need to get good jobs.
As the noble Lord, Lord Shipley, articulated, the higher education sector is one of the major partners in delivering the research and development levelling-up mission through hubs of research and innovation. The Department for Science, Innovation and Technology is leading delivery of the research and development levelling-up mission—a cross-government commitment to increase domestic public investment in R&D outside the greater south-east by at least 40% by 2030 and, over the spending review period, by at least one-third.
We are supporting this through ambitious programmes such as the innovation accelerators, investing £100 million to support Glasgow, Greater Manchester and the West Midlands to become major centres for research and innovation, bringing together higher education with local government and business leaders. The programme is pioneering a new model of research and development decision-making that empowers local leaders to harness innovation in support of regional economic growth. Strengthening innovation clusters is a top priority for driving growth across the UK. As many noble Lords said, universities, as anchor institutions, play a crucial role in this, creating a pipeline of skilled graduates, attracting talent and investment, spinning out innovative firms, and catalysing collaboration across the local ecosystem.
The noble Baroness, Lady Wilcox, was critical of the Government’s record on spin-outs and university commercialisation. This surprises me, because, looking at the data, we see that the number and value of equity investments secured by academic spin-outs has increased from just over £1 billion in 2014-15 to comfortably over £5 billion in 2021-22. If you consider the research resource, UK universities generate more income from intellectual property, and only slightly fewer spin-outs, than US universities.
A number of noble Lords, including the noble Lords, Lord Bilimoria and Lord Parekh, my noble friend Lord Vaizey and the noble Baroness, Lady Prashar, talked about international students. My noble friend Lord Norton of Louth asked me to confirm our commitment to our extraordinarily successful international education strategy—that remains firm.
The noble Lord, Lord Blunkett, was generous enough to say that I had already said this, but I shall say it one more time: international undergraduate student numbers have grown in recent years, but not at the expense of domestic undergraduate numbers. Most international entrants to the UK higher education system are at postgraduate level.
The noble Baroness, Lady Prashar, asked about taking international students out of the migration statistics. Net migration is a demographic measure, and it can always be derived even if we were to take students out, but that is ultimately a decision for the Office for National Statistics.
In closing, I want to mention the speech of the noble Baroness, Lady Wolf, who put in a far more sophisticated way than I am about to do some of the wider reflections on the role of higher education as we look forward in a rapidly changing world. Historically—when I was lucky enough to be at university—models of higher education facilitated, in effect, a smaller number of more privileged students to achieve university places and go on to very well-paid and high-status careers. The inequalities of those models have rightly been challenged, including by the reforms of the Blair Government, with that focus on widening participation.
Of course, higher education is a vital part of social mobility. However, as we continue to support, we must also challenge the higher education sector as participation widens to make sure that we do not lose that focus on quality, on employability and on good outcomes for all its learners. The noble Baroness, Lady Wolf, raised wider questions, but while higher education plays a critical role in growth and productivity both nationally and regionally, it needs to be part, and is part, of a wider growth strategy that addresses the worsening trends in inactivity in the working-age population, the levels of investment across the economy, and the education and careers that our children and young people deserve. That is where this Government are focusing.
Lord Blunkett (Lab)
My Lords, it is a very wise tradition that those who have moved take-note Motions do not make another speech at the end, but I shall just take one minute, if your Lordships do not mind, to thank the noble Baroness for, as ever, a thoughtful and comprehensive response to what has been an excellent debate. I thank everyone who has taken part for their generosity and for their wisdom, including those with whom I disagreed. The great thing about a seminar of this sort is that the spirit of Socrates still shines through. I say this to the noble Lord, Lord Wallace of Saltaire: when the scientist challenged the idea of social sciences having a value, did he not wonder what he might have said to his colleagues who were teaching classics?
I was really pleased that the Minister got an honorary degree from Bath. “Don’t throw the baby out” is the message that we crave this afternoon.
The noble Lord, Lord Norton, and I were contemporaries at the University of Sheffield politics department. I spent too much of my time, perhaps, marching against apartheid, while he spent far too much of his time in the library.
To conclude, I want to reassure the noble Lord, Lord Willetts, that the dog has kept his breakfast in on this occasion. I think that was a measure of the quality of the debate. The quality of education is crucial to all of us. If there are problems, we can fix them, but, above all, we should tell the rest of the world, as the Chancellor endeavoured to do yesterday, that the higher education sector in Britain is open for business, is the best in the world and will give a very warm welcome to any student who wants to come here.
Defence Acquisition Reform
(2 months ago)
Lords ChamberRead Full debate Read Hansard Text Read Debate Ministerial Extracts
Lord Coaker (Lab)
My Lords, I thank the noble Earl for coming to the House to respond to these questions and the necessary scrutiny, on a repeat of the Statement from another place. It is welcome that the Government are finally beginning to acknowledge what we on these Benches and many others, including the National Audit Office, the Public Accounts Committee and the Defence Committee, have been saying for a long time—that defence procurement is not working.
The Statement referred to the narrative of the acquisition system being dogged by major programmes and, while certain programmes have indeed been over budget and over time, the issues go much wider. Some 46 of 52 major projects have been either late or over budget under this Government. It is a systemic problem. In the past 14 years, £15 billion of taxpayers’ money has gone to waste, £5 billion in this Parliament. Report after report from the NAO and the committees that I have mentioned have been critical.
This is not just about the wasted money, as important as that is. Continuous failure in MoD procurement sends a message to the world, to both our allies and our adversaries. Good defence procurement can strengthen our sovereignty; make our country more secure; provide economic growth by creating and supporting jobs; and ensure that our troops can fulfil their roles and fight, while allowing us to fulfil the obligations that we have to our NATO allies. As we would all agree, it is therefore a top priority.
The changes are right and welcome and we agree with the reasons for the reforms set out by the Minister. Indeed, there is not too much in the Statement that you can disagree with, but the real concerns with the Government’s approach stem from the lack of action to tackle the bigger issues, which is a disappointment and a missed opportunity.
The Government’s policy for acquisition reform, as set out in the Command Paper refresh and the Statement, do not address the waste and poor value for money that have plagued the Government’s mismanagement. Without addressing the waste of taxpayer money at the scale that I have set out, it is difficult to see how the reform as set out by the Government will fix the problem. How will the Government ensure that these reforms offer value for money and stop the waste that we have seen? What steps are they taking to address the underlying systemic issues that have contributed to the delays and mismanagement that the Minister has acknowledged in the Statement, which have led to these projects being late and over budget? It certainly does not appear that they would have prevented the issues with some of the major programmes mentioned in the Statement, such as Ajax or Morpheus, or others that were not mentioned, such as the E-7 Wedgetails. Is that analysis wrong and, if so, why?
We are under no illusions that the problems can always be eliminated entirely—as the Statement says, these are incredibly complex programmes and procurements—but they should not be on the scale that we have seen. Does that not mean that there is real scope to improve in this situation? How will these reforms ensure proper accountability to prevent further delays and mismanagement of these vital defence contracts, those that we have now and those we will have in future? A fundamental question that the Government need to answer is how the report will make the difference that we all want, and why it will be successful when so many other reports have failed.
We believe that we should create a new strategic leadership in procurement. If we form the next Government, we will establish a fully fledged national armaments director, responsible to the strategic centre for ensuring that we have the capabilities needed to execute the defence plans and operations demanded by the new era. We envisage core delivery tasks that currently do not seem to be vested properly anywhere in the system; they should have sufficient authority or accountability to carry these out effectively. This leadership includes alignment of defence procurement across all five domains to cut waste and duplication, securing NATO standardisation, collaboration with allies, driving export campaigns and delivering a new industrial strategy. What is the Government’s view of a new director such as this to drive the change that we all want? Which of the things that I have said does the noble Earl disagree with? They are a sensible plan for driving forward change.
We have to do better. Report after report promises action on the problems in defence procurement and promises that there will be improvement as we move forward. Yet our procurement process is dogged with failure and delay, which means that our troops and Armed Forces do not have the equipment that they rightly should. The fundamental question that the noble Earl needs to answer is this: why will this report be different from the reports that have gone before it?
Baroness Smith of Newnham (LD)
My Lords, “over-complex, over-budget and over-time” is how major programmes of defence procurement have been characterised not just by the opposition, our enemies or even our allies but by the Minister for Defence Procurement in giving this Statement in the other place. Defence procurement has, over years, been riddled with problems, as the noble Lord, Lord Coaker, pointed out. While this Statement is very welcome, there is a question about whether it goes far enough or thinks about the wider pattern of defence procurement.
I read the Statement as it was produced and put into the Printed Paper Office last week. It said, “Check against delivery”. I read it, and there were various points where I thought, “Surely no Minister actually said this”. I went back and looked at Hansard to see what the Minister for Defence Procurement said in the other place and, indeed, some of the slightly strange comments were made in the House of Commons. I will therefore ask a few very specific questions.
What we have as the fifth aspect of the new approach to procurement is:
“Fifthly, we will pursue spiral development by default”.
Other noble Lords might know what spiral development is, but I am afraid that I do not. The Statement did not give me much clarity on it, nor does the document that was produced to go alongside it, so I hope the Minister can explain a little more what spiral development means.
Even more, however, I would like to know what is meant by the next line:
“seeking 60% to 80% of the possible, rather than striving for perfection”.
I realise that there have been concerns about the fact that we have looked for exquisite solutions and platforms that are so highly specified that they become ever more complicated, with the timeline for procurement shifting ever further to the right. However, “60% of the possible” raises a lot of questions. Does it mean that only 60% of our ammunition is going to work, or that only 60% of our trials of Trident will work? Given that we seem to have had a couple of problems with Trident recently, I very much hope that the Minister can explain what this means. There is nothing in the Statement or the document that explains clearly that we do not want to spend so long over-specifying things that we never deliver the platforms or equipment that our Armed Forces need. Do we think that we need to specify less? What do the Government mean?
The Statement talks about learning the lessons of experience, which is clearly very welcome. We do not want another Ajax. Learning from that experience is highly welcome and I am sure the Minister would be very grateful not to have to face the situation that his predecessor, the noble Baroness, Lady Goldie, did, of repeatedly coming to your Lordships’ House and having to answer questions about Ajax for which, frankly, there were not any good answers.
Do the Government think that just learning the lessons of the recent past is enough? Will that deliver, at pace, as we say we need, the defence equipment that the United Kingdom needs in an era of unprecedented challenges? Will the noble Earl, in his response, tell the House how far this procurement model will really help us deliver beyond what we have been seeing and help ensure that, if we are sticking at 2% of GDP on defence expenditure, which seems to be the case from the Budget, that we are actually going to be equipped at the level we need to be to face the challenges that we and our allies are facing, and send the messages that we need to be sending to Russia, China, Iran and other countries, some of which we certainly would not think of even as collaborators in international relations?
The Minister of State, Ministry of Defence (The Earl of Minto) (Con)
My Lords I thank the noble Lord, Lord Coaker, and the noble Baroness, Lady Smith, for their questions and their very well-made points. The whole point of this paper is to look forward, not to the past. I think there is a full acceptance on all sides of the House that we can agree on the need to reform our acquisition processes, because they are rooted in the past, not in the current; and of course they ought to be rooted in the future.
As mentioned by my honourable friend the Minister for Defence Procurement in the other place,
“the long-standing weaknesses … are well known”.—[Official Report, Commons, 28/2/24; col. 354.]
They include highly exquisite requirements—“exquisite” is his word—constrained export opportunities, vulnerable supply chains, personnel wary of speaking up when problems emerge, not to mention the overprogramming and unintended competitiveness between different parts of the organisation for finite funding. All these have to be addressed if we are going to move forwards.
I draw all noble Lords’ attention, if they have not already been made aware of it, to the publication placed in the Libraries of both Houses last week, Integrated Procurement Model: Driving Pace in the Delivery of Military Capability. Within that document, noble Lords will find the five core principles through which we will deliver acquisition reform. For the benefit of the House, these are as follows—some have already been mentioned.
A coherent, joined-up approach across the defence portfolio to break down the silo nature of procurement.
New checks and balances to challenge assumptions. Taking expert advice from the outset of projects, not half way through, when it is either too late or no longer appropriate.
Prioritising exportability. Far too much of what we have done has been tailor-made. We work in a global market now, where there are skills and abilities outside our shores, sitting with our allies, where we should not only take advantage of their industrial capability but also the sales opportunity that it presents to us.
Empowering industrial innovation through greater transparency and common endeavour. Transparency is so important in this ability to be honest about the situation as things progress. We need to be able to have the honesty to challenge each other the whole way through the process, to make certain that we do not disappear down blind alleys and that things are produced to time and to budget, when they ought to be, and that everybody feels open enough and relaxed enough to be able to challenge some of these issues.
Then there is the whole question of continuous improvement, or spiral development. Spiral development is a new term for me as well. I come from the private sector, where it is called “test and refine”. The principle is very simple. There is a point when you know that what you are doing is capable of achieving the aim. It is not perfect, but you test it, you use it, you learn and you refine it. You can also refine it for other customers as well: you have the base model, it works well, you can test it and then start to develop it in various different directions, to do various different things that you might want, but also what any potential customer might want. It does make perfect sense, I must admit.
Before turning to the questions quite rightly raised, and some of the challenges, I will look at the way procurement has been taking place. Let us be in no doubt, these are extremely complex pieces of technology and equipment, and they do take a long time to bring to fruition—particularly some of the larger ships and aircraft, as I am sure noble Lords are fully aware. It is a long gestation process, where checks and balances need to be inserted at the right place. But it appears to me, looking from the outside, that the process is well overdue an update, and that it needs to be much nimbler, quicker, more open, more collaborative, more informed, more technologically advanced, more digitally enhanced—you name it. There is such opportunity here.
Will it work? Well, it has certainly made a good start. I will mention just a few things about where we have got to. We already have some initiatives under way, and they are starting to improve things. We are starting to drive pace; risk and complexity are being looked at; senior responsible owners and their teams are much more focused; the strategic alignment is getting better; and the capacity and capability of the professionals involved and the SROs is improving. Psychological safety—this idea of being open and honest with each other and having a non-blame culture, which I do not think we have had in the past—pan-defence category management and financial savings: all these things come down to capability having to be holistic. To have an effective operation and delivery across organisational boundaries, you have to have a holistic view.
I will now address some of the questions. The question of value for money, as raised by the noble Lord, Lord Coaker, which I am sure everybody is aware of, is a question of budgeting and taking a sensible approach, being up front about the budget and making certain that the opportunities and contingencies within the budget are transparent. That is very much the case.
On the question of underlying mismanagement, there are various plans in place within the organisations to ensure greater accountability, less project management and more specific accountability for specific parts of work, which makes the whole ownership that much easier and more driven on a private sector opportunity basis.
I think I have addressed the questions of analysis and accountability in speaking on the empowering of individuals. Will this work? Like everything, it is never going to work from day one, but it is a real move in the right direction. It is the current way that large industrial organisations work now, and the ability to insert SMEs in the process the whole way along is absolutely critical. If one thinks about technology and digital in particular, it is often SMEs that come up with the good ideas. They need to be inserted within the business and supported right the way through so that—I hardly dare say this—the primes do not gobble them up and sometimes destroy their nimbleness. So, this is the right thing to do. The question of co-operation with NATO and other allies is, equally, extremely well made.
The noble Baroness mentioned spiral development. It is a strange concept to be described like that, but I completely understand that it is “test and refine”. You get to a certain level, which is 60% to 80% of where you want to end up; you feel confident enough that you can actually put it out into the live environment, in the clear knowledge that you are going to get it back to make it better once it has been used and other people have seen its breadth of opportunity.
On the question of overcomplication, it is a difficult matter. We are dealing with very complicated machinery and skills, and everything we have learned in the past couple of years suggests that things do not need to be overcomplicated; they just need to work, and we need to be able to produce them at pace and in volume.
On Ajax, the Sheldon review has addressed this, I hope. Without making silly jokes about it being back on the road, the lessons really have been learned on Ajax—luckily, it is a thing from the past. We do learn from the lessons of the past, and procurement, if it is properly addressed, is about learning from experience, or enhancing and living with the concept of change. I hope that the challenges that we have seen have been addressed by what I think is a an extremely sensible and practical way forward for the very complicated and broad-ranging challenge of military procurement for a nation state. We could not take it more seriously; I certainly undertake to keep noble Lords fully up to date with all progress as we start to introduce some of the main milestones that will come up within the next two to three years.
Lord West of Spithead (Lab)
My Lords, war is raging in Europe, the Levant, the southern Red Sea and Sudan. We are in the most dangerous and hostile world we have been in for many years and, amazingly, the Government have not increased or provided any extra spending for defence in yesterday’s Budget. State-on-state warfare is back. Does the Minister agree that, in terms of procurement, we must look much longer-term? For example, the carriers had £1.5 billion added to their cost because, to get the funding line straight in MoD, they stopped work on them for two years—a ridiculous thing to do. Equally, we are now desperately trying to get enough frigates into our Navy because we took too long ordering them. The SMEs have a real problem. We need to have a drumbeat of orders looking to the future, which we should commit to, because we now know that we are in a world where there is state-on-state warfare. More importantly, does the noble Earl agree that that will provide some resilience, so that, for example, when we start giving ammunition stocks or whatever to people, the firms involved have built into their whole organisation a structure that enables them to be replaced?
The Earl of Minto (Con)
I agree with almost everything that the noble Lord said. Certainly, the immediacy of the situation has already introduced into the procurement cycle within the Ministry of Defence a much more nimble way of acquiring the needed munitions, both for gifting and for our own stockpiles. We have started to invest substantial sums of money in the industrial base. If you think about this way of proceeding, it is very much a joint relationship with the industrial manufacturers that will deliver exactly what we want here, as far as both the primes and the SMEs are concerned. It is being driven by the current situation and the rate of technological advance.
Lord Arbuthnot of Edrom (Con)
My Lords, I declare my interests as set out in the register. It is nearly 30 years since I became the Minister for Defence Procurement, so ably succeeded by the noble Lord, Lord Bach, who I see in his place—and the questions do not change. New threats arise as old threats remain, and sometimes get worse. Our dependence on technology is greater now than it ever has been; therefore, our vulnerability is greater now than it ever has been. I welcome what my noble friend says about a more joined-up approach across the defence sector, but does he not agree that it has to be married with a more joined-up approach across the infrastructure sector as a whole, because of that very vulnerability?
The Earl of Minto (Con)
My Lords, I agree. The Americans have a very good expression: “soup to nuts”. It is a very simple way of describing any project from one end right to the other. I believe that is precisely what my friend in the other place is trying to achieve here, in coming up with a considerably more flexible and nimble approach to the threats that we currently face.
Lord Deben (Con)
Could my noble friend go back to number two of his five principles? It seems to me that in the private sector, we have a very large number of these problems as far as procurement is concerned. There are many places where great strides have been made. It has always been thought that the forces are not always willing to accept, with a degree of openness, advice from the private sector—not just in the single programme, but overall. Can my noble friend reassure the House that this is really going to change, and that people understand that there are aspects of procurement which are not just about how you do this very difficult technical kind of procurement, but which really can be learned from other people?
The Earl of Minto (Con)
My Lords, I entirely agree with my noble friend. There is no doubt that the private sector and the Ministry of Defence need to work much more closely together to ensure that the absolutely current technology is not only available but able to be developed, and that the working practices and checks and balances on some of the assumptions that have been made are tested properly within the wider concept, not just within the forces network. This is incredibly important. If there is to be a joined-up approach and a proper pan-defence affordability exercise at the outset, it almost demands engagement across a much wider base than previously.
Local Regeneration: Industrial Areas
(2 months ago)
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Baroness Armstrong of Hill Top
That this House takes note of the case for local regeneration of former industrial areas across the whole United Kingdom, and the challenges constraining such regeneration, including in relation to local government.
Baroness Armstrong of Hill Top (Lab)
My Lords, it is a great privilege and pleasure to introduce this debate, partly, of course, because it gives me the chance to talk about the north-east again, the contribution that previous generations from that region have made to the prosperity of this country, and what we can do now—in the region and nationally—to give this generation and future generations real opportunity.
I grew up with coal mining, shipbuilding and steelmaking dominating community life. My early working life saw those industries in decline, and I worked with people in communities whose lives were totally changed because of the decline of those industries. I am not necessarily saying I regret the loss of all of them, because people like me—women—were not exactly important in the industry. We were important in terms of looking after the men when they came off their shift, but that was not the sort of life I wanted.
I became Member of Parliament for North West Durham in 1987 and by then all the pits in the constituencies had closed, although we had a lot of open cast mining and the Consett steelworks had closed in 1984. Consett was the largest town in the constituency, built to accommodate the workers at the steel mill. It was seen as the most efficient steel mill in the country at the time of its closure, but accessibility was never as easy and straightforward there as it was for the port in Teesside, so it was closed to keep Redcar steel mills open. Some of the workforce from Consett, particularly from management, was transferred there, as were some of the fittings.
The work to remove the infrastructure in Consett took place very quickly. A lot of the funding from that came from the EU to clear the contaminated land. Steel production delivers very contaminated land. Things were not very sophisticated in those days. Essentially the top soil was buried, meaning that the Environment Agency had to monitor levels of contamination on a regular basis, alongside strict warnings to any local farmer who thought that it might be a good idea to graze his cattle that if he did so there would be no ability to use the milk or the meat from it because of the level of cadmium poisoning that there would be.
We dealt with so many of those aspects. We also dealt with a totally changed population, with more women working than ever before and more women working than men. I and my neighbour and good friend Giles Radice, who subsequently came to this House and died last year—I miss him enormously—worked with the local council on regeneration projects, with new industrial estates being built around Consett and on other land that was not contaminated. We also worked on long-term plans for the main site. Project Genesis is still going. It is a public/private partnership and, yes, it has taken a long time to redevelop that site.
Therefore, noble Lords will understand our disappointment when British Steel decided to close Redcar. When I was Local Government Minister in the 1997 to 2001 Parliament, I knew of the importance of the private sector in local government services and in regeneration projects. I introduced the concept that has been forgotten about, best value—how did we ensure that the public got the best out of partnerships and contracts with the private sector? We legislated on it and so on but, unfortunately, in too many regards it has been forgotten. From the recent report on the Teesworks project—it is on the old steelworks site in Redcar that my folk gave up their jobs for, as they saw it—it is clear that best value has not happened. I regret this enormously and am anxious that the Government address what has gone wrong with governance, the nature of contracts and procurement in what are essentially public/private partnerships, and in transparency of regeneration projects that are as complex as this—and they are complex.
Teesworks was initially, in 2020, a 50:50 joint venture partnership. There were two private sector businessmen who had acquired an option on part of the land at Redcar Bulk Terminal, and they then used that as leverage in the compulsory purchase of the wider set of land. The following month, they became formal joint venture partners with the South Tees Development Corporation; there was no tendering and no procurement process—certainly nobody was told that there were procurement processes, and I am sure they would have been after the complaints.
To cut a long story short, without any public announcement, the joint venture was changed in Companies House in November 2021 to a 90:10 deal in favour of the private businesses rather than the public sector. Difficult stories then circulated about the price of land, the complexity of the deals, the lack of transparency, the apparent substantial profit made without any private investment on a site of such public importance, the size of the public investment with no return at this stage to the public, and the lack of transparency to evidence value for money. The Secretary of State for Levelling Up set up an inquiry that made 28 recommendations, which raised significant questions. I will sum it up with a quotation:
“Based on the evidence from the review the governance and financial management arrangements are not of themselves sufficiently robust or transparent to evidence value for money”.
The mayor has responded to the concerns about governance, but there are, unfortunately, significant gaps in the response, and we now wait for the Secretary of State’s response.
I am devastated that this programme has ended up with so many questions and that there is not a better story to tell. I want the project to succeed; we desperately need regeneration and activity that can tackle the deep problems that the de-industrialisation of our region has caused for so many families. I made a speech here two weeks ago when I talked about the latest report on child poverty from the region that I am involved with. We see the activities of the North East Mayor and the Tees Valley Mayor as critical, in future, to a regional response to the mission of enabling every child to have opportunities to develop to their full potential. The previous debate from my noble friend Lord Blunkett emphasised that it is precisely in these areas that attainment is worst and that the gap between those who do well and those who do badly is biggest. Deindustrialisation has real consequences; in Middlesbrough, which is part of Tees Valley, 41% of children since 2014 are now in child poverty. I am really keen to work with the Mayor of Tees Valley—the noble Lord, Lord Houchen—on tackling these issues, which are partly a consequence of this deindustrialisation. The report must be taken seriously, and the Government need to address some of the ways that systems have failed.
I am sure the Minister will say that she cannot answer my questions until the Secretary of State has replied, but it is really important that if she cannot answer today, she writes to me—she will gather by the end of the questions when I want her to write to me about the answers.
First, will the Government ensure that the terms of their current joint venture partnership with Teesworks are renegotiated, as recommended by the report? Will they also ensure that any future contracts for work are properly procured, with best value for the taxpayer assured? Will the Government consider audit and scrutiny proposals for all combined authorities that secure best value for the public purse? Will they also enable the National Audit Office to further review the activities of the Tees Valley Combined Authority? I hope that the Minister will press on the Secretary of State that we need his response before purdah for the May elections.
Regeneration of difficult, contaminated, former industrial sites is not easy. It takes time and, I am afraid, considerable investment. In regions such as the north-east, however, this is still a major issue years after major industrial works have closed. I understand that democracy demands a level of openness and transparency that some in the private sector find inhibiting; it takes time, because people have to be consulted. However, I genuinely believe that, with proper public oversight, accountability and transparency, we can get economic regeneration that is sustainable.
The effect of deindustrialisation is devastating for the whole community and, if not effectively tackled, can blight future generations. Local, regional and national government all have responsibilities, but we have to work together to meet them. I look for that commitment from the Government today.
Lord Mawson (CB)
My Lords, I thank the noble Baroness, Lady Armstrong, for initiating the debate. I know she cares a great deal about these issues and the local communities they affect, many of which are in very challenged circumstances.
I start with a telling story that encapsulates what happened in one of our former industrial areas. My mother died in Bradford, at 104 years of age, last June. She lived most of her life there, my hometown. Her father ran an ice cream shop in Oak Lane, just below the 27-acre site of what was then Lister Mills. It was originally a sweet shop, but my grandfather was so skilled at making brilliant ice cream, which he sold literally in bucketloads to thousands of workers at the mill, that the sweets and chocolates went the way of the world; he focused on what sold.
Some 150 people, mainly old Bradfordians, turned up at my mother’s 100th birthday party in 2018. She was still well networked from her armchair, through the use of her trusted telephone. The day before the party, I picked up an old brochure in Haworth, Brontë land, about the Bradford festival in 1931. Both my mother and father attended this amazing event in the city when they were at school, but they did not know each other at that time. Everyone was there—the mayor, the council, businesspeople and all the schools. My mother still remembered the excitement of it all.
In the brochure you got a real sense of the dynamic economy in Bradford at that time and a landscape defined by woollen mills and a culture of entrepreneurship. Bradford was described as the second most successful city outside London. I was told that, in 1931, Lister Mills had recently won the order for the velvet curtains for the White House—not bad. In my mother’s lifetime, this former industrial city, largely run by woollen entrepreneurs and successful businesspeople, fell to the position it holds today. What happened in one lifetime?
My colleagues and I have been working in Bradford over the last six years—I declare my interests—and I have returned to have a good look under the carpet. The first thing that strikes you is that there are still some amazing entrepreneurial people in Bradford. Pull back the carpet and you will find the Pakistani-owned cake business, in a back street, which has supplied more than 1 billion fairy cakes to Tesco. This baker then spent more than £1 million trying to restore and maintain a grade 2 listed mill complex of 400,000 square feet—impressive.
Six years ago, I was invited by the dean of Bradford Cathedral to speak at an evening event about our work in the East End of London and the Olympic legacy project, which was focused on the derelict rail and industrial lands in Stratford which I had been involved in from day one for 19 years. I described how in Bromley-by-Bow we had fostered an entrepreneurial culture against the odds in what was originally a failing group of housing estates, opposite what is now the Olympic park. The cathedral was packed. I then invited the massively impressive Bradford architect and business entrepreneur Amir Hussain to join me on stage. Amir had some really inspiring plans for some empty mills in the city, some of them still amazing industrial buildings but derelict. When I had finished my bit, Amir took us all through the list of Bradford’s former lord mayors, an amazing list of successful woollen entrepreneurs who were focused on building high-quality buildings, growing an industry that now had relationships across the world, and making theirs the best city in the country. They were practical Yorkshire people who invested in education, the arts and culture, and improved people’s lives and health. When Titus Salt, the former mayor, died, thousands of Bradfordians turned out for his funeral—again, not bad.
Amir then took us through the list of successful entrepreneurs in the city today, many of them women, many Asian and most of them young. How many of these practical, impressive people who were building and running businesses in the city were on the council today? The answer is none. Amir tells me that they were too busy running their businesses and being practical—very Yorkshire. These are serious questions. Who are we looking to if we want to rebuild our industrial sites and grapple with the broken machinery of the state? It is not the talkers; it has to be the doers. They are committed, practical people and the only ones who understand the real issues, precisely because they have done it. In my experience these people are everywhere, in plain sight, but our systems and processes often do not recognise them and have little understanding of their significance for a city. We need to find them, back them based on their track record and certainly resource them. We need to get interested in people again, not endless processes.
Those who are real doers are often slightly disruptive and, yes, difficult people who ask difficult questions. As a result, they tend not to be the people who are influencing the policies and details of national, regional or local government. As a result, we do not harness those with real skills, innovation and entrepreneurial flair. Therefore, unsurprisingly, government continues to underperform. It is all about people, not structures and policy. It is about those who act.
Amir Hussain, who I mentioned, runs a dynamic and innovative data technology company as one of several businesses in the city. He reflects on Lister Mills today, where an ambitious and incomplete apartment development has done little to stimulate regeneration. Not one new café, office or business can be attributed to the development, and the apartment values have slumped to less than half the original selling price despite many millions of pounds of government grant funding. Yet within this magnificent industrial complex reside sophisticated businesses such as Haddow, run by James Nimmo, producing textile designs for some of the biggest names in the world. Amir relates his shock at finding that there were more than 100 trendy young designers, as he called them, beavering away deep inside the old weaving sheds, in a scene reminiscent of Willy Wonka’s chocolate factory, but no one had noticed.
Compounding this, he told me, is the fact that our approach to data is inadvertently undermining places such as Bradford. During a collaborative meeting with the credit reference agency Experian, Amir had it analyse his own neighbourhood, just a mile away from Lister Mills. The findings were shocking. According to Experian, no one had any money, all were financially stretched and they predominantly shopped at discount stores, and therefore this area should be avoided by brands such as Nando’s, Costa, PureGym, et cetera. It was obvious to the practitioner Amir that something was very wrong, not least because there were people on his street owning brand-new Rolls-Royces. The fact that the area is 70% Pakistani Muslim had gone unnoticed. The data did not recognise that this demographic has different financial habits such as a greater use of cash, buying second and third houses, and building house extensions. In this community, the prevalence of gold shops and dessert parlours would be a far better indicator of financial capacity than credit card use.
Bradford is a success story because these people are there—I have met them, and they care about the future of their city—but I am afraid that the siloed systems and processes of the state are not fit for purpose. This city is not attracting serious, experienced and talented leadership, and when they come, they do not stay long. Who was the last Cabinet Secretary to visit Bradford who got under the carpet and took a look and an interest in these entrepreneurial people and the implementation issues they are facing as they attempt to make their businesses and their city a success? It is all about people and not process; it is about the quality of people such as Alan Bates, who cared for 20 years and got stuck in. There are people like Alan in Bradford, hiding in plain sight.
This all throws up difficult questions for all our political parties about the calibre and experience of the people they are selecting who claim to represent our cities and communities such as this one. What have many of them built? What have they done? What have they achieved in practice? Are they asking the right questions?
These questions also apply, of course, to your Lordships’ House. It has been suggested by the noble Lord, Lord Norton of Louth, that a Peer of the realm should be chosen on “conspicuous merit”—not a bad measure, and a challenge to us all and to our political parties. Is this the benchmark we need for those who would claim to represent us at all levels?
I will finish by taking noble Lords to Fox Valley, in Stocksbridge, on the edge of Sheffield, where the paragon umbrella frame was invented. There, a local family who cared about where they lived—Mark Dransfield and his late wife, Deborah Holmes—took the risk of taking hold of a former derelict steelworks site, put their hard-earned money in, and grappled with the often very unhelpful machinery and infrastructure of the state. Hundreds of new jobs have been created there and many new businesses, new retail space and offices, and 115 new homes, with a thousand more planned. The centre is like a piece of theatre; so many community events happen there. I encourage noble Lords to go and have a look for themselves on the internet at the quality of this development. Go and visit and taste the quality of the food at Ponti’s restaurant—the first outside London. It is a great day out. My mother went, and she loved it.
Someone cared enough, someone took the long view, and someone took risks. It was Mark and Deborah. Joanna Lumley, who opened Fox Valley in 2016, said that she had never seen anything quite like it anywhere in the south of England: the attention to detail; a development that transformed a former steel town; a meeting place where work and leisure engage with high-quality public realm and architecture. Land that had laid derelict for 10 years, deepening the spiralling decline of the town, had become the catalyst for transformation—all down to two practical people who cared about where they lived.
In closing, I ask the Minister: what percentage of levelling-up funding has not actually been spent since its launch in 2020? Why might this be?
Baroness Bennett of Manor Castle (GP)
My Lords, it is a pleasure to follow the brave and challenging speech of the noble Lord, Lord Mawson. He led me to reflect on the impact of the first past the post electoral system in creating one-party states in local government, with some of the outcomes that he outlined. He also inspired me with his wander through the tastes of Yorkshire. I have to mention the wonderful Razan Alsous, a Syrian refugee who came to Yorkshire in 2012 and missed what she describes as her “squeaky cheese”—traditional halloumi cheese that she ate in Damascus. She now has an award-winning company making that cheese in Yorkshire.
I thank the noble Baroness, Lady Armstrong of Hill Top, for securing this debate, particularly for the way she worded the topic—the word “local” in “local regeneration of former industrial areas” is so important here. I thank her also for highlighting the challenges constraining this, particularly local government. I thirdly thank her for her timing, since my visits last weekend to Newcastle and North Tyneside means that I will have the same regional focus as the noble Baroness brought to this debate.
My visit was differently directed towards the Byker Wall estate, a 1970s social housing project with grade 2 listed status that has tried to maintain its existing community from the pre-development streets. There were many issues then and since in making that work. What I saw in my visit to Byker was a real struggle to deal with the problems of litter and isolation and loneliness, but it is also notable that community groups, such as Byker Mutual Aid, Byker Village Tenants and Residents Association, and St Peter’s Neighbourhood Association, have sprung up to try to fill the gaps that have been left by more than a decade of austerity in public services. Byker was the site of the incinerator ash scandal in the 1990s. The incinerator was finally closed due to the action of campaigners at the turn of the century.
Picking up on points that the noble Baroness made, we need to think about the clean-up of industrial and post-industrial areas and to focus on public health. Clean air, clean water and soil are the crucial foundations for a healthy community. We know that, across the UK, we have a major problem with disability and chronic illnesses. Of course individuals need support with that, but what we really need to do is build healthier communities so that people do not get ill in the first place. Figures from the Office for Health Improvement and Disparities show that in the most deprived neighbourhoods in England, which are many of the areas we are talking about, people develop multiple long-term health conditions 10 to 15 years earlier than in the least deprived communities, they spend many more years in ill health and they die sooner.
Another thing we need to focus on in many of these areas around health is warm, comfortable, affordable-to-heat homes. This is a particular issue in Byker, where the cost of heating with a district heating system is considerably higher than in other areas. In so many of these post-industrial areas, the housing stock is poor, yet that is a potential opportunity. The insulation of homes can create a field for many small, independent businesses, provided that they have the certainty of long-term government investment and not the boom and bust that has been induced by see-sawing government policies. I am afraid that the largest current opposition party has see-sawed in its home energy efficiency policies even before it has got into government.
Last month, the New Economics Foundation looked at the data on the Government’s home energy efficiency schemes and showed that, in a single year, rollout had fallen by 40%. The total number of households upgraded by the home upgrade grant—HUG—and local authority delivery schemes has fallen by 40% in the past year. Similarly, the number of households upgraded under ECO, the largest and longest running scheme, has fallen by 55% in the past year. The social housing decarbonisation fund has existed for less than two years, but if we look at the figures quarter on quarter, we find that it is down 41% as well. This is key to Britain reaching its net-zero targets, but it is also crucial to cutting the £2 billion costs for the NHS that come from the poor quality of our housing stock.
Money that has to be spent on heating cannot be spent with local businesses and suppliers. It goes into big multinational pockets. Had the Government brought in community energy schemes, which your Lordships’ House tried to push very hard through the Energy Bill, the money could be returning into communities.
On the importance of local activity, local energy and local decision-making, I want to focus on some good news stories. One of the places I want to highlight is the Valley Project in Holme Wood, Bradford. There was an adventure playground project there, and money was parachuted in from London—the whole plan was parachuted in. Some big high-tech equipment was installed. It lasted a couple of years and then fell apart. Then, a couple of local people, ironically made unemployed by austerity, started small, working with the community. It is now a wonderfully lively, successful project using mostly recycled and donated materials that the children work with to design their own spaces. As a little advert for it, if anyone knows a local source, it is currently looking for some large wooden cable reels for the children to use in their secret garden as tables and chairs. That gives a sense of the kind of project that is working to lift up that community.
I have not yet focused on industrial policy, as I am sure many noble Lords to follow in this debate may well do. To return to Byker, the area has a proud history of glassworks and community artists, a tradition that continues with Mushroom Works, Testhouse 5 and Lime Street. The estate was built with hobby rooms: spaces for people to do activities. The one that I visited used to house a darkroom for the development of photography skills, but they are often not widely used today. We need to see that the resources are there to be put in to work with local people to develop such facilities for modern-day uses. The key has to be to build on what is already there in local communities and focus on their skills, knowledge and capacities, rather than bringing in highly paid outside consultants and grand plans drawn up by them.
Here, I want to draw a real contrast. The noble Baroness, Lady Armstrong, caused me to cross out a significant part of my speech that covered the Teesworks area, so I want to look at the alternative, 180-degrees opposed model. The Preston model of public sector working and community wealth building is focused on the procurement policies of the local authority and other anchor institutions, such as its university and housing providers, to support local businesses, develop new enterprises, encourage better working conditions such as through the real living wage, and increase the socially productive use of wealth and assets, such as local government pension funds. The focus is on genuine prosperity and the creation of wealth in that community, rather than some, often all too artificial, bottom line.
I go back to a figure that I have cited before in your Lordships’ House: 10% of the entire land area of Britain has been sold out of public ownership in the past four decades. That 10% of the entire country was 50% of what used to be public land holdings. We need to see a building up or restoration of public assets, not further privatisation and loss to the public. For example, among the co-operatives in Preston there is the Brookfield retrofit co-operative, led by a community organisation, and a housing co-operative for—and run by—the Traveller community.
What is not the way forward, as the noble Baroness, Lady Armstrong, set out so clearly, are the freeports. That model encourages corruption, tax evasion and criminal activity. Freeports suck businesses and jobs out of other areas; indeed, the evidence from around the world is that it is a model built mostly on relocating existing businesses, not generating anything new.
I conclude with the words of Ruth Hannan, the former director of the People’s Powerhouse in Preston. She told an event last year that the need for local government is to be as flexible as possible, so that it can improve people’s lives. Ms Hannan said:
“Most of the time, we have to fit into the system, rather than the system adapting to us”.
I suggest that that is also a lesson for Westminster. Westminster needs to get out of the road. It needs to stop providing directions and being a backseat driver, to ensure that local communities have the power and resources that they need to make decisions for their own future, not with direction from what is often far, far away Westminster.
Baroness Chapman of Darlington (Lab)
It is a pleasure to follow the noble Baroness, Lady Bennett of Manor Castle. I did not agree with absolutely everything she said but I welcome the fact that she has recently visited the north-east. I am glad that she gets the positive impression of the place that she has rightly conveyed to the Chamber this afternoon.
I congratulate my noble friend Lady Armstrong of Hill Top. She was possibly the first woman politician who I ever heard speak in real life and it is a privilege to join her debate today. I remember that one of the things she talked about—I hesitate to say that she repeated herself today and, rather than talking about men in the steel industry, she was talking about politicians—was how, as a young woman growing up, it was the men who did the standing up and talking and the woman who made the tea. That stuck with me and probably acted as a bit of a spur—and I do not make the tea, as my husband will tell you.
Like my noble friend, my family worked in steel at ICI on Teesside. My great uncle Ken sold veg door to door in South Bank. I have lived in what we now call the Tees Valley for 43 years. My dad was born in Pym Street in South Bank. The noble Baroness, Lady Bennett, spoke about health, and as well she might because our health indicators in this part of the world have not been great over the years.
However, I reject the noble Baroness’s swipe at the previous Labour Government over this. My dad died aged 48 of a heart condition in 1994. Had he lived for maybe another five years to see the election of the Labour Government, when investment and reforms were put into the health service, there was a very good chance he would have lived. There were people dying on waiting lists in 1994, waiting for more than a year and a half for heart treatment. That stopped with the Labour Government. I am very proud of what we delivered, not just in health, but in education and in joining up public services, and in our regional development agency in the north-east during our period in government.
My children were born in Darlington, which is part of what we are now calling Tees Valley. My nana thought that moving to Darlington was the ultimate in going up in the world. That was only until she moved into sheltered accommodation in Marske, because then she had really made it. It is a great place to be from, with a globally significant contribution to the industries of the past and the potential to be the same again today.
Our devolution settlement and the election of the first Tees Valley Mayor was an opportunity to grow our local economy and invest in our people in a joined-up way. Some good things have happened. Our airport is secure, for the time being at least, and our university is thriving. But many are wondering, after six years, where the money has gone and when they and their families will begin to feel the benefit. After decades of industrial decline, unemployment rates on Teesside are among the highest in the country at 4.2%, compared with the national average of 3.7%. Child poverty is at 36%, compared with the national average of 29%. The case for regeneration of this former industrial heartland is overwhelming.
I will not go over everything my noble friend Lady Armstrong said, but we now find that we have a mayoralty—and sadly, by extension, on the world stage, the Tees Valley—that is mired in controversy. At the heart of the accusations lies the deal which saw the creation of an entity called Teesworks in July 2020. It was nominally a 50/50 joint venture partnership. You can argue about whether 50/50 was fair or right at the time the joint venture was established, but you can certainly ask questions about what happened subsequently.
This controversy will never hit our pride in our area—no political shenanigans could do that—but it harms the potential for future investment. That is why I, my noble friend, and others around this House have been repeatedly trying to get answers from Ministers about what has gone on and what the Government intend to do about it.
As my noble friend explained, the 50/50 stake in the joint venture became a 90/10 stake in favour of the businessmen investors. The Government seemed to accept that there was a case worth investigating and Michael Gove commissioned a report. It had some quite worrying findings. It found that it was clear that the Tees Valley Combined Authority had “no sight” of decisions around the joint venture,
“other than specific deals where they may act to provide financial covenants or instruments”.
According to Private Eye, the arrangement for Teesworks to buy land was also changed, and the land purchase cost was reduced by £1 per acre from the previous market value. Why did this happen? There followed a land purchasing at £1 per acre for the freehold at South Bank Quay, and preparation for this land was financed by the public, with a £107 million loan from the UK Infrastructure Bank. Other land was purchased by the developers for less—£100, with complex lease and sale arrangements. Given the complexity of all these deals, the lack of transparency, the apparent advantage shown to a handful of preferred developers and the substantial profits made, without any investment in a site of such public importance, it is absolutely right that the concerns were raised and the inquiry was called.
We find ourselves at the end of that inquiry and reading the report, with so many questions left outstanding. We are concerned about a lack of transparency, inadequate governance and financial mismanagement, as found by the report—not a good deal for the taxpayer, in my opinion. We must make sure that we get to the bottom of all this. It is only fair for the reputation of Tees Valley and for the need for taxpayers locally and nationally to get the best value for their investment. That is why we continue to call for a comprehensive and independent investigation by the National Audit Office to restore public trust and confidence in the project.
I appreciate that some of our questions are a bit technical and detailed. We may have asked them of this Minister; we have certainly asked other Ministers. My noble friend has asked to have a response in a letter, and I add to that a request for a meeting with officials so that we can understand the Government’s reluctance to allow the NAO to investigate. My understanding is that that could be done incredibly quickly—in a matter of days, not weeks or months. It is necessary to have that investigation and a clean bill of health from the NAO so that investors can have the confidence that they need. They will be looking at reputational risk, and they need to know that their investments will be sound.
Tees Valley is a treasured home to us and a place of invention and innovation. Yes we have our challenges, but if our brightest days are to lie ahead we need to lift the lid on this. We need to find out what has happened, remove any stain of suspicion of impropriety and allow ourselves to move forward as the strong community that we are.
Baroness Donaghy (Lab)
I thank my noble friend Lady Armstrong for initiating this debate and for her powerful and moving introduction. My noble friend Lady Chapman referred to listening to her when she was a younger woman and being influenced by her. At the risk of turning this into a sketch by John Cleese, I will say that I canvassed for my noble friend Lady Armstrong’s father, Ernie Armstrong MP, so it is an area that I love very much and am very familiar with. As we are having to establish our regional credentials, I say that my mother’s family comes from Barnsley, and I spent the first 21 years of my life having Christmas there, so it is a town I am extremely fond of—end of John Cleese sketch.
When I think of the wasted years we have lived through—with an absence of government industrial strategy, underinvestment in our transport network and the reduction of local government to virtual serfdom—I could weep. To be fair, one version of this Conservative Government, led by Theresa May and in this House for BEIS by the noble Lord, Lord Henley, did have an industrial strategy. There was support from all sides of the House. However, we woke up one morning and it had been disappeared. Although it was somewhat limited in its scope, it acknowledged the need for co-ordination in support for business, education and skills and local involvement, but it came to nothing.
Indeed, we have witnessed years of so-called levelling up, where a complex maze of funds was created, many with overlapping purposes, and where local and regional authorities were invited to bid for limited amounts and in competition with one another. The Minister, the noble Baroness, Lady Scott, was very frank at the Dispatch Box recently in saying that there was not enough money to support all local authorities, so we endured a giant bingo game, with Michael Gove the chief bingo caller handing out the cash to the lucky winners. Then my imagination started to run away with me, and I was thinking of things like “Clickety-click: new theatre in Clwyd”; “Legs eleven”—well, I will leave the rest to your imagination.
It is calculated that 23 million people live in older industrial areas in Britain—that is one-third of the population. This does not include seaside towns, many of which have similar problems, as outlined in my noble friend Lord Bassam’s excellent committee report on that subject. People suffer multiple forms of disadvantage in those areas, apart from being older on average, lower paid and disabled. The Government take pride in the number of jobs available at the moment, and it is a matter of pride, although I doubt that they had very much to do with it. However, between 2012 and 2019, job growth in older industrial towns was around one-third of the equivalent rate in London—there were 66 jobs for every 100 adults. Commuting to larger towns for work is the norm and sometimes commuting by public transport is not possible. The possession of a car provided access to 28 times more jobs within a 30-minute journey compared with three times in London.
I am a strong supporter of local government, and it is not a perfect system. There will always be a need to moderate between wealthy areas and poor areas to ensure some kind of fairness. Let us be honest: it is how that distribution has been made by successive Governments which determines how really fair the deal might be. We need a return to strong local government, but that requires a step change in funding. It also requires a period of capacity building, given the dire state of affairs in many parts of the country.
The Resolution Foundation and the Centre for Economic Performance produced a report in June 2022 entitled All Over the Place: Perspectives on Local Economic Prosperity. They ran four focus groups in Yorkshire and Humber. The people were from all walks of life, and they talked about their lives in Leeds, Hull, Barnsley and Scarborough. They cared very much about their area but felt strongly that things should get better. In every region of England, more than three-quarters of the population think their area has either trodden water or deteriorated in recent years. The focus groups were aware that their local areas had different routes to prosperity and were alive to the tensions and trade-offs that growth could bring.
All the groups were upset about the degradation of their places and public services—empty shops, unsafe public spaces and weak policing were cited. Although work was readily available, job quality was a pressing concern—low-paid jobs, casual employment, zero-hours contracts, a lack of training and progression, and the sometimes unlawful behaviour of employers.
There is a generation of young people in those areas who do not go into higher education and whose work experience would depress the strongest heart. In the levelling up debates, the Government recognised the criticisms by local government of lack of co-ordination, inefficiencies, complexity of decision-making and reporting burdens. It talked about empowering local decision-makers, local satisfaction and engagement, and a needs-based approach. That is all very good, but it is some time in the future and yet to be delivered. Now the Government are offering a long-term plan for towns. Local government will still need to put in bids and set up town boards, including the local MP, and central government will set up a new towns task force, offering capacity support to town boards. This just sound like the same centralising bidding process—it is just a bigger bingo game.
Yesterday’s Budget covered investment zones, freeports, trailblazer devolution deals and a levelling up fund—even the renovation of local village halls. That is all well and good, but there was no co-ordination to ensure appropriate infrastructure and transport links. It is still a system of handing out the sweeties, along with namechecks for the class favourites—no genuine empowerment.
Finally, the Government have made a big thing about the so-called freeports, to which the noble Baroness from the Green Party referred. A lot more announcements have been made about freeports than actual freeports. I share the scepticism of some commentators about freeports’ potential impact, and I agree with the comment that they are more likely to encourage displacement of economic activity from surrounding areas, rather than increase overall growth. There is no proof that freeports generate high-skilled jobs.
The Office for Budget Responsibility has said that any additional economic activity generated by a freeport would
“probably be difficult to discern even in retrospect”.
It stated that enterprise zone reliefs act more as a reward than an incentive, and that existing infrastructure and transport links are stronger determinants of levels of activity.
In conclusion, the contrast between those with the most opportunities and those with the least opportunities in the UK is shocking and unacceptable. For the Government to start saying some of the right things does not make up for 13 years of not listening, and it is no substitute for a strong and vibrant local government.
The Lord Bishop of Norwich
My Lords, the place that shaped me most as a priest in the Church of England was the parish of Holy Trinity North Ormesby in Middlesbrough at the turn of the millennium, so it was a simple delight and joy to hear the noble Baroness, Lady Chapman, speak about so many places that I know, from South Bank to Maske.
North Ormesby is set among derelict land, chemical plants and the distant smoke, sound and smell of the coke and steel furnaces. It is a place that taught me so much about resilience and survival, as well as about the strength of community, even when the stuffing had been knocked out of it. The people there taught me about acceptance and that each day was filled with little blessings. But I also learned about poverty and the impact of damp houses, as well as about health inequalities that meant that, if you lived six miles away, on average you lived another decade.
In all the indices, that community still comes out as being among the poorest, most ill, most unemployed and most unskilled, as well as having the lowest educational attainment and the worst air quality of wards in this nation. But the people I lived alongside in that community have warm and large hearts, despite the challenging context. The church was at the centre of its long-term regeneration, successfully building the Trinity Centre—a place for support, learning, faith and fun, it said. It was funded by the single regeneration budget and the neighbourhood renewal fund, but also, crucially, by many small grant-making trusts—and a local couple who one day knocked on the vicarage door with £1,000 of their savings because they believed in what we were doing. We gave confidence to the local authority and a housing association to invest in that community when others simply walked away.
What else did I learn in that former industrial community and its regeneration? I learned the need to be with people rather than doing things to people; the need to listen to stories of place, of loss and of hope; the need to recognise that local people are often the experts, as the noble Lord, Lord Mawson, has reminded us; and the need to raise up community leaders of broad consensus, not extreme voices that propagate hatred, division and scapegoating. I learned that there would be setbacks along the way; that generosity wins hearts and minds, as does adding beauty to the built environment; that patience is often in short supply, but you need to have it for the long haul; and that regeneration takes time, over multiple changes in government policy, not five years. As the noble Baroness, Lady Armstrong, said in her excellent opening speech, regeneration is complex.
However, none of that is a substitute for investment—for money—which both signals our priorities as a society and makes up for chronic underinvestment over time. We see that money can be found for some parts of the country, but often not for the north, the south-west, the coastal towns that I serve in Norfolk or our poorest communities. Levelling up is about valuing the flourishing of all people, made in the image of God, valued in God’s sight and created for a purpose.
I saw that on a recent visit to Dumfries House, an incredible place that His Majesty the King has championed. It has been the engine for regeneration and new opportunities in that part of Ayrshire, marked by its mining past. Heritage projects can also play a part in the regeneration of former industrial areas, but, again, it has taken patience, local engagement and money. The extension of the long-term plan for towns in yesterday’s Budget is a welcome and important signal of the Government’s intent, as is the funding for community regeneration around heritage. Yet the scale and speed of delivery is just as important as the aspiration behind the policy. The latter has perhaps been more successful than the former thus far.
As the Chancellor of the Exchequer announced yesterday, more investment in historically underinvested areas is important, and I would be intrigued to know from the Minister what His Majesty’s Government learned from listening to those former industrial communities in shaping their policies. How much of yesterday’s announcement is new money?
In Middlesbrough we were, in a sense, living out the recommendations of the 1985 Faith in the City report, commissioned by Archbishop Robert Runcie and famously described by one Cabinet Minister at the time as “pure Marxist theology”—which was some way off the mark but simply made more people take note and read it. That report concluded:
“Chapter after chapter … tells the same story: that a growing number of people are excluded by poverty or powerlessness from sharing in the common life of our nation”.
If that was true in 1985, it is an indictment that it is still true today in so many former industrial areas. Indeed, the Archbishops’ Commission on Families and Households published a report last year that could have been written 40 years before. It said:
“Increasing interconnected inequalities and discrimination prevent many people from living flourishing lives”.
I would argue that the decades-long failure to invest in our former industrial communities is a form of discrimination that we must commit to putting right together, across government and this House.
Back in 1985, Faith in the City called for
“a deeper commitment to create a society in which benefits and burdens are shared in a more equitable way”.
One of the final lines in the report will resonate with many of us clergy who have lived and worked in former industrial communities and who minister in those communities today:
“to stand more closely alongside the risen Christ with those who are poor and powerless”.
Alongside churches of different traditions, and different faith communities, the Church seeks to do this in every community in this country. We must be a living and breathing Church of and with the poor, not simply an institution for the poor. I ask the Minister what role the Government see for themselves in this context, standing alongside the poor and powerless in these former industrial areas.
Finally, I stress the importance of the household support fund, which has become a lifeline for local authorities to run essential services since it was introduced in September 2021. In Norfolk, the fund is used wisely to give direct support to low-income families, to give grants to libraries to deliver period poverty and hygiene grab-and-go bags, to provide debt and financial advice, and, through a major grant to the Norfolk Community Foundation, to reach often excluded communities—I declare an interest as a patron. The fund is a lifeline for many residents. While I welcome the temporary extension of the household support fund announced in yesterday’s Budget, I ask the Minister to set out the Government’s plans to put local government funding on a sustainable footing. While welcome, these short-term, short-notice extensions provide little time for local councils to plan effectively, as we would all wish and expect them to do.
We owe it to our former industrial areas to champion them, so that all people might flourish and find life in all its fullness. I am grateful to the noble Baronesses, Lady Armstrong and Lady Swinburne, for their advocacy and expertise on these issues and for bringing this debate to our consideration today.
Lord Shipley (LD)
My Lords, I thank the noble Baroness, Lady Armstrong, for enabling us to have this important debate. I remind the House that I am a vice-president of the Local Government Association. It has been a helpful and thought-provoking debate. Some very important points have been made and some very interesting reminiscences shared. The noble Baroness said three words in her speech which struck me as being at the heart of what we are debating: “Deindustrialisation has consequences”. It does have consequences. Things change. Parts of the industrial revolution and our extraction industries have come to an end, but there has to be a plan for coping with that, and the record of the past 50 years has not been entirely good in that respect.
The noble Baroness raised the question of best value. Having been a councillor at that time, I praise her for what she did, because best value is a very good way of operating; the more of it, the better. We also heard quite a bit about the issues in Tees Valley. I hope the Minister will be able to answer the very specific questions that were raised. I have twice spoken on the Tees Valley issue—once when the first press publicity came out and then in a statutory instrument debate on the east Midlands, on whether the scrutiny, audit and risk structures inside combined authorities were fit for purpose or not. That was a general point I was raising about them, and I shall raise it again when we come to the next combined authority statutory instrument.
I hope the Minister will be in a position to respond to that, because, as the noble Baroness, Lady Chapman, said, this needs to be in writing, it needs to be very clear, and it needs to be quick. I think there needs to be an investigation by the National Audit Office. If the Secretary of State is not minded to do that, there needs to be a clear explanation why so that we can debate it on the Floor of the House.
There are some significant examples of success in brownfield regeneration, such as with a number of railway stations. A number of colleagues will be aware of the proposed major development to the west of York station and it was announced only a little while ago that there will be over 1,000 new homes to the west of Newcastle Central station, underpinned by the work of Homes England. According to the press announcement from 15 February, Peter Denton, chief executive of Homes England, said:
“It’s hard to overstate the importance of this acquisition. Not only will the site deliver around 1,100 quality, sustainable new homes, but bringing Quayside West into public sector ownership will act as a catalyst for the wider regeneration of Forth Yards, a key regeneration area for the city that has been stalled for more than 20 years. It’s a complex, challenging brownfield site that could have a transformational impact in the city, but it needs up-front public sector intervention to unlock its full potential … Newcastle City Council and North of Tyne Combined Authority have a clear vision for Forth Yards, and we’re working with them and Network Rail to take a holistic approach and ensure that it delivers for the people of Newcastle. This will include, if necessary, using our statutory powers to make this happen”.
I welcome that, because that is public intervention which will input public cash to deliver that outcome. By the way, it also meets the brownfield presumption recently announced by the Secretary of State and demonstrates that it can be done. It is really good that, of the 18 key performance indicators that Homes England has, the very first is the amount of brownfield land reclaimed. That is a measure we will all be able to see.
As the noble Baroness, Lady Donaghy, said, 23 million people live in older industrial Britain, many with lower-than-average earnings, a higher-than-average amount in manual jobs and many with a lower proportion of degrees and lower jobs growth in their areas. Many of the newer jobs in those areas are in the service sector—retail, warehouse fulfilment, call centres; they do not pay big salaries and they are not high-productivity jobs. As we have heard—and I agree entirely—the Government should encourage local leadership, end competitive funding and put in place single-pot funding. It needs money of the kind we used to have when we had regional development agencies. When I look around the north-east of England at what has happened in, say, the automotive industry, pharmaceuticals and renewable energy, that sectoral approach has worked well.
We will now have the combined authorities and combined counties. I wish them every success. I think they have a capacity problem and do not have enough planners or planning officers. We lack an industrial strategy, which the noble Baroness, Lady Donaghy, mentioned. There needs to be one. We also need pension funds to increase their investment in the UK. I give due credit to Legal & General, which has invested in northern cities in recent years.
Let me move briefly to the impact of HS2. One of my great fears about HS2 was that if the track did not reach the north of England, private sector development money would follow the track. On 20 February, I opened my copy of the Guardian to read the executive chairman of HS2, Jon Thompson, say that:
“For too long the debate on the wider economic benefits of high-speed rail in the UK has relied on anecdotal evidence. This report gives definitive proof that investor appetite, regeneration activity and investment close to HS2’s regional assets has surged”.
It has become clear that there is significant investment into the West Midlands as a consequence of HS2. Of course, the track is now to stop at Birmingham. It is reasonable for anybody in the rest of the United Kingdom to ask: what is the impact on our areas? Are we actually losing investment in the rest of the country as a consequence of what is happening in the West Midlands? Good luck to the West Midlands, but we do not wish to see investment sucked out of the north of England.
This issue is finally about gap funding, and I thank the Library for its brief on this. The brownfield presumption will work only with money to help with infrastructure such as roads, schools, trains and buses, yet the lack of money is plain to see. We saw how much gap funding was needed for urban development corporations. The APPG on Coalfield Communities described this as a Catch-22 situation whereby the private sector will not invest on the speculative basis because the local economy is too weak, but the shortage of good-quality premises constrains local business growth. Stakeholders suggest that gap funding would encourage private sector investment in brownfield sites, new workspaces and historic assets. I hope the next Government will read the report of this debate and then act on it.
Baroness Taylor of Stevenage (Lab)
My Lords, I congratulate my noble friend Lady Armstrong on securing this important debate. I first met her back in 1997, after the general election; she was incredibly kind to me then and has inspired me ever since, so I thank her for that. I thank the noble Lord, Lord Mawson, for the memory of a sweet-shop; my great-great-grandparents had a sweet-shop in the East End of London, which is also a happy memory.
This afternoon, we have heard about Teesside, Barnsley, Newcastle, Bradford, Dumfries, the East End of London, Sheffield, and seaside towns, and I am going to talk about new towns. The debate has demonstrated yet again, as did yesterday’s sticking-plaster Budget, a Government who have no clear plan for the economy or a cogent and comprehensive industrial strategy, or effective national devolution, and will simply fail in their vital task of ensuring that our country achieves its full and very considerable potential. Meanwhile, the so-called levelling-up mission runs into the sand, with cancelled projects, piecemeal funding bids, Ministers who cave in too easily to their Back-Benchers, failure to deliver the skills that business needs, and a devastating failure to deliver infrastructure, which means, for example, developers waiting longer to get a grid connection for one development—in some cases, eight years—than it took to build the whole core of our motorway network in the 1950s and 1960s.
Regeneration is needed across our country, a case clearly set out by my noble friend Lady Donaghy. Many areas are plagued by the sort of inequalities that the right reverend Prelate referred to so powerfully.
Although I do not come from one of the former industrial parts of the country, I can speak about regeneration from first-hand experience. Our new towns—a marvellous innovation of the post-war Labour Government—designed to provide the right conditions for the technological revolution that was taking place, and to provide good-quality, affordable housing for the skilled workforce that would be needed, were delivered over a relatively short timespan. Of course, if you build an entire city or town over a period of little more than a decade, some 50 years later it will need extensive renewal and regeneration all at the same time. I always think of it like putting new light bulbs in your house when you move in; then they all go at the same time.
We also had to create the right conditions to allow the town’s industrial base to move from the heavy manufacturing and engineering in the defence industry, which had provided the employment of the early decades, to developing the life sciences cluster—now the largest in the world outside the USA—and an established space, defence and communications cluster. In case noble Lords did not know, one in three of the satellites up in space, processing our phone and data signals and guiding our GPS and satnavs, is made in Stevenage in Hertfordshire.
We have not dragged our heels on housebuilding either, because we understand the co-dependency between housing and the economy which is deep in our new-town roots. That co-dependency was mentioned by the noble Baroness, Lady Bennett. Our new-town pioneers got their homes and their jobs together, enabling them to truly have a vision of a good life for them and their families.
We have also seen the decline and hollowing out of our town centre. This is the same problem faced across so many of our towns and cities in the UK, but exacerbated for us by the fact that when the development corporation was wound up in the 1980s—and in spite of determined local action to try and prevent it happening—all the property in our town centre was handed over to investment houses and pension funds. We ended up with a complex web of over 60 large landholders, with the council retaining only the expense of the public realm maintenance.
Nevertheless, in spite of one false start which crashed with the rest of the economy in 2008, we put our minds and very considerable efforts to the task of comprehensive regeneration. Helped by the noble Lord, Lord Heseltine, our community, our local enterprise partnership and an amazing collaboration between local leaders across public, private and community sectors, as well as party-political boundaries—there was no one-party state here, as the noble Baroness, Lady Bennett, talked about—we are now in the midst of a successful £1 billion regeneration which is transforming the heart of our town.
We are using town centre development to build a considerable number of the homes we need, which helps us with the constraints of tight town boundaries. We have optimised the opportunities that our east coast fast rail links bring by co-locating a new bus station, and both benefit from being linked into our 45 kilometres of cycleways. We are bringing the success of our cell and gene therapy cluster into the heart of the town, with lab space above the retail area. We set the conditions which enabled us to secure the £65 million European headquarters for Autolus, an American cell and gene research and development company. That scheme was taken from concept, through planning and a land deal, and on to site in eight months, so do not tell me that councils cannot move fast enough when they need to.
However, in the last 14 years it has felt too often that keeping the pace of this regeneration going from local government has been a battle and has been in spite of the conditions set by government, not because of them. The Centre for Cities has identified some of the barriers that areas face, and I recognise many of these. First, on risk, the private sector will lead where it is certain of a clear financial return, but often in the areas in most need of regeneration the risk for the private sector is too great on its own, so some level of public intervention will be needed. Too many government pump-priming funding pots—even where they are available—require sums of local match funding that are just unrealistic, and we do not have a system of local/regional investment funding in this country, as there is elsewhere in Europe, that could help.
Secondly, it must be recognised that social return—jobs, skills, local infrastructure and affordable housing—will need to be realised as well as private return, and that this is likely to need support. Andy Haldane, commenting on yesterday’s Budget, said that until we resolve the issues around millions of our workforce in this country not having the skills needed in our economy, we will not resolve our productivity and growth issues.
Planning and policy uncertainty are a real barrier for the private sector, as is access to essential infrastructure such as grid connections, water and high-speed data. The lack of a proper industrial strategy means that these are a real barrier to growth, and they are a barrier now. I have spoken before in this Chamber of my personal pain at having our local growth plans stalled, as our local plan was held for over a year on a holding direction by the Secretary of State. These kind of interventions really have to stop.
The Centre for Cities put it very clearly when it said that
“public-private cooperation can best maximise the private and social returns from a project”.
This is vital so that the people of the local area benefit, as well as those who have invested for profit. My noble friends Lady Armstrong and Lady Chapman, and the right reverend Prelate, have already mentioned, when they spoke about Teesworks, what happens when this balance gets tilted the wrong way. At the heart of that issue are the people of Teesside and the public assets formerly owned by them that should have been regenerated for their benefit to generate jobs, employment and industry. They should also be receiving sufficient return for their investment of land and the other value of the site. The governance of the project should have ensured an appropriate sharing of the risk taken by private sector partners to justify the returns that they have already accrued, as mentioned in the recent review.
The report’s scathing assessment and its 28 recommendations highlight the need for reviews of financial regulations and the make-up of the board, better oversight and scrutiny, reporting to the board, and for the public interest test being foremost in terms of transparency. The report also highlighted that not enough attention is paid to conflicts of interest, including those of the mayor. Seriously, the report highlights procurement issues, including the decision mentioned by my noble friend Lady Armstrong to change the balance of ownership in favour of the private owners to a 90/10 split, and the balance of risk between the public and the private sector, when to date the public sector seems to have taken the bulk of the risk and been responsible for the costs invested while the private sector has had the benefit of the profits.
There are very serious questions to answer about whether it has all been in the best interests of the people of Teesside. Have they had value for money for their public investment? As my noble friend Lady Armstrong indicated, the report asks more questions than it answers, questions that the people of the north-east deserve and have a right to have answered. As the noble Lord, Lord Shipley, said, why will the Government not accept the offer of the National Audit Office for a forensic financial assessment of what went on?
It is time for a reset on regeneration to ensure that it delivers for people in so many areas across our country who genuinely feel that they have been left behind—because they have been left behind. I hope that the Minister agrees with me on what is needed, a programme that the Labour Party have set out very clearly. We need a stable industrial strategy to create the conditions that businesses need in order to invest. We need to move away from insecure, low-paid jobs and strengthen our programme of apprenticeships, skills and training, and employment rights, to make sure that work pays. We need a national wealth fund to generate the private investment that we need. We need to get to work on building the affordable housing that we know we need as a matter of urgency. We need to speed up our critical infrastructure projects to get Britain moving again. There needs to be a complete reform of the planning system, so that it works for the builders not the bureaucrats, and investment in clean British power for cheaper bills and energy security.
We are all hoping on this side that the general election will come soon so that the British people can decide whether they want more of the decline of the last 14 years or a Britain where growth comes from the grass roots, where growth serves both people and businesses—a Britain with its future back.
The Parliamentary Under-Secretary of State, Department for Levelling Up, Housing & Communities (Baroness Swinburne) (Con)
I thank the noble Baroness, Lady Armstrong of Hill Top, for tabling this important debate on local regeneration of former industrial areas across the whole of the United Kingdom. We have visited a very large swathe of the United Kingdom in today’s debate, also talking about the challenges constraining such regeneration. I thank all noble Lords for their considered and insightful contributions today, some of which I agree with—not all, but I am sure that we can work our way through them.
I too grew up in a former industrial area, in south-west Wales. I went to school during the miners’ strike as the granddaughter of a miner. I spent a large number of my years as an MEP supporting Welsh economic developments through the EU’s convergence funds, looking at how you regenerate some of those industrial areas. Therefore, I have some first-hand experience, share your Lordships’ aspirations for these areas and support their redevelopment.
However, as we all know, over the last 50 years the UK has seen fast and extensive deindustrialisation, with a lasting impact in many areas, including, as we have heard, the north, Yorkshire and the Humber, my own country of Wales and certainly the Midlands. That is to name but a few. We have heard today even more examples of where this has happened.
Although London and much of the UK have flourished under the new economic trends, former industrial centres that were once the beating heart of the Industrial Revolution have struggled, and continue to do so. I agree with the noble Baroness, Lady Donaghy, and all sorts of other noble Lords here, that this is not right. According to the Institute for Fiscal Studies, average wages in London in 2019 were 60% higher than those in Scarborough and Grimsby, with the top 10% of earners in London earning nearly twice as much per hour. Half of working-age adults in London and Brighton have university degrees, compared with less than one-fifth in places such as Doncaster or Mansfield. We are under no illusions about the scale of the challenge to regenerate these former industrial areas, and that is precisely why we have made it central to this Government’s levelling-up agenda.
I know that the noble Lords will have heard this before, but it bears repeating: for this Government, levelling up means ensuring that your life chances are not determined by where you grow up. It means addressing entrenched regional disparities to unlock economic growth everywhere and ensuring that people benefit from these rises in living standards and well-being. Nowhere is this more important than in our post-industrial heartlands—places where once, a location meant a life path. Now, while celebrating the cultural history and heritage of these places, we are committed to unlocking their full and wide-ranging potential.
Before turning to specific issues that noble Lords have raised in the debate, I will talk through some of what the Government are doing to try to make this happen. We are rolling out gigabit broadband across the UK; introducing education investment areas; opening freeports; increasing the national living wage; launching the long-term plan for towns and the anti-social behaviour action plan, while recruiting more police officers; and, importantly, delivering through our extensive local growth funds, including the levelling up fund and the UK shared prosperity fund. Through the third round of the levelling up fund, we are investing a further £1 billion in 55 projects across the length and breadth of the UK.
As many noble Lords have mentioned, we are using the levelling-up needs metrics to target funding at the places that need it the most, ensuring that every part of the country benefits. Multiple projects in former industrial areas are benefiting, such as the £20 million South Shields riverside transformation project, the £19.5 million River Tyne regeneration infrastructure project and, as the noble Lord, Lord Mawson, will appreciate, the £19.8 million project in Bradford to support and enhance Keighley’s engineering, manufacturing and economic role in the region, to name but a few. We have granted town deals exceeding £20 million to a number of other former industrial areas. As well as Barnsley, Doncaster and Wakefield, we are including 12 more that were announced yesterday by the Chancellor. They will receive £20 million each to invest in community regeneration over the next decade; it will be led by local people in order to be determined by local need.
Beyond our funds, post-industrial areas in the Midlands, such as Stoke-on-Trent and Mansfield, are being supported by bespoke and intensive levelling up partnerships. Levelling up requires a multifaceted approach, as many noble Lords have said today, from catalysing industrial clusters in the sectors that will drive the future economy to supercharging our city regions, to supporting our struggling towns and local areas.
We know that the challenge is large and recognise that it is not a simple task. It will not be achieved through quick wins. As the right reverend Prelate the Bishop of Norwich said, restoring pride in place across all areas of the UK, including those with a strong historic cultural identity, will take time. The current economic context makes this even harder, but even more essential, and so this is why structural and systemic change is so important, not least the empowerment of local leaders. I agree with many noble Lords who have spoken today that local decision-making is best. To this end, we have set ourselves a clear mission that, by 2030, every part of England that wants one will have a devolution deal, with powers at, or approaching, the highest level of devolution, with a simplified, long-term funding settlement.
Since 2022, we have announced nine new devolution deals, many of which are for post-industrial areas. These include, as many noble Lords know, a new mayoral combined authority deal for York and North Yorkshire, as well as Hull and East Yorkshire, the first ever mayoral combined county authority deal in the east Midlands and a second mayoral combined county authority deal announced with Greater Lincolnshire.
This May, the north-east will become the first region to be entirely covered by a mayoral devolution. A new north-east mayoral combined authority will be established, which will mean that every person in the north-east will have their own authority and elected leader, making decisions in their best interests. English devolution currently covers about 14.2 million people, taking the proportion now covered by a devolution deal to greater than 64%—up from 40% just a few years ago.
I turn to some of the other issues that were raised. We also recognise the challenges facing the local government sector and have committed to reducing the complexity of local government funding. I note the comments from many noble Lords. We have listened to local partners. In July 2023, we published our plan to simplify the funding landscape. Through this, we are delivering a more transparent, simple and accountable approach to funding and we are beginning to put this into action. For example, we have adopted a new approach to the third and final round of the levelling up fund, which has moved away from competition and made use of the large number of high-quality bids submitted in round 2. This was designed to reduce burdens on applicants and maximise efficiency.
Similarly, the UK shared prosperity fund provides local authorities more flexibility with a three-year allocation that they can choose how to spend on local priorities or projects. The most recent local government finance settlement for 2024-25 makes some £64.7 billion available to councils across the country—an increase in core spending power on 2023-24 of up to £4.5 billion or 7.5% in cash terms. We appreciate that they have more work to do and are therefore trying to fund them appropriately.
Baroness Taylor of Stevenage (Lab)
The Secretary of State made an outrageous statement this week about local authorities using consultants. They are used mostly to put together the very bids that the noble Baroness just set out. Can she please take back to the Secretary of State that it is absolutely wrong to criticise local government, which is starved of resources anyway for the reasons we all know about and is desperately trying to get hold of some of the funding to which she referred? The only way that local government can do this is by bringing in consultants to put its bids together; it does not have the resources otherwise. I ask the noble Baroness to take that back to the department and get it to think about this again.
Baroness Swinburne (Con)
I give the noble Baroness that assurance: I will take that back to the department. It is my first week in the department, so I do not have an answer for her now, but I will speak to the civil servants and my Secretary of State.
I will continue. The settlement includes additional measures for local authorities in England, announced on 24 January, which will be worth an additional £600 million. We are trying to provide local authorities with as much bespoke support as possible, knowing that they have more jobs to do to deliver some of these programmes.
The work that we have done to create a climate for investment through the development of our freeports and investment zones programmes will drive up living standards and regenerate selected areas. Unlike the noble Baroness, Lady Bennett, and some others, I think that the freeport initiative will be a source of jobs and investment. So far, we have created 12 freeports, eight of which are in former industrial areas—including in Teesside, the east Midlands, the Humber, Plymouth and the Solent—two are green freeports in Scotland and two are in Wales. All are now open for business and creating jobs.
Freeports are all about securing economic futures, and that of the UK as a whole, by reorienting regional economies towards innovative, low-carbon sectors such as renewables and advanced manufacturing. I believe that we are already seeing some movement here, with 6,000 jobs expected to be created and £2.9 billion of investment promised. They are also creating high-quality jobs across the UK, right in the communities where they are needed most.
Meanwhile, our investment zones programme recognises that the UK has underperformed in leveraging the success of key industries and certain research strengths, so they will be established in places with significant unmet productivity potential, many of which have a rich industrial history. For example, the zones in South Yorkshire, Greater Manchester and the north-east of England are focusing on clusters associated with advanced manufacturing, nodding to their industrial heritage while investing further in high-potential industries of the present and the future.
The Government recognise the crucial role played by the private sector in the levelling-up agenda through schemes such as investment zones and freeports. We aim to enable and empower the private sector to increase investment, jobs and growth at a local level. Good quality, self-sustaining growth will be delivered through capitalising on the growing industries of the future. That includes manufacturing, where our funding is targeted to ensure that UK industry copes with the fundamental changes to remain at the forefront of the global transition to net zero. We are committed to growing the economy and ensuring that funding does not focus solely on the most successful sectors today but looks ahead as we keep pace internationally and build the UK’s expertise for the industries of the future.
In acknowledging many noble Lords’ close ties to the north-east region, I am delighted to draw attention to the recent announcement of a £40 million funding package to accelerate Teesside regeneration. Middlesbrough, alongside Redcar and Cleveland, will receive £20 million each—a total of £40 million—to help ramp up improvements, with targeted projects planned to revitalise high streets, healthcare, transport and education, and to create more affordable housing.
Finally, in County Durham, where I understand that the noble Baroness, Lady Armstrong, served as Member of Parliament, the market town of Bishop Auckland, which expanded to serve the coal industry, has been awarded £53 million from the Government’s future high streets fund and towns fund to support its development as a visitor destination of national significance. I look forward to visiting, given that my grandparents come from there. This investment will help diversify and enhance the town centre, improve transport connectivity and provide new skills and enterprise opportunities for young people. I hope noble Lords will acknowledge that that is a fitting response to celebrate the town’s proud industrial heritage.
I have a very large number of questions that I will try to zip through. My handwriting is appalling, so please forgive me if I stumble. I really empathise with the pride that the noble Baroness, Lady Chapman, has in her home area. It certainly made me think about my upbringing in my area. To date, approximately £1.4 billion in levelling-up funding has been allocated to projects in the north-east and Tees Valley. This funding covers a range of regeneration priorities, including addressing the local skills gap and developing emerging sectors in former industrial areas. Across all three rounds of the levelling up fund, the north-east has received more per capita than any other English region, alongside wider programmes including devolution deals, levelling-up partnerships and our long-term plan for towns. This shows our commitment to level up the region.
I turn to some of the remarks that many noble Baronesses and noble Lords made with respect to the Teesworks controversy. Following the concerns raised about Teesworks and the actions of the Tees Valley Combined Authority, we commissioned an independent external review, which was published on Monday 29 January. This found no evidence of corruption or illegality but made a series of constructive recommendations regarding the governance and transparency of the project. For the two recommendations relevant to central government, we will carefully consider how to support the continued success of the mayoral development corporation across the country and the recommendations regarding the landfill tax. The Secretary of State made a written request to the Tees Valley mayor, asking him to set out how he intends to respond to the panel’s recommendations by 8 March. This has already been done, and we hope to publish all this in a very short time.
I have been asked why the National Audit Office should not examine this. I have a note here to tell me that the NAO’s role is not to audit or examine individual local authorities, and its powers would not normally be used for that purpose. It would therefore be inappropriate to expand its role so significantly by asking it to lead this inquiry.
The panel that did this investigation was made up of individuals with significant experience in assurance and local government. The panel spent months investigating thoroughly, and found no evidence of corruption or fraud. Its report has been published; I am sure noble Lords have all read it, as they have alluded to. It was published a week after we received it. We welcome the constructive recommendations and are actively considering the way in which these relate to central government.
Baroness Chapman of Darlington (Lab)
I in no way wish to besmirch those on the panel that conducted the report—they did what they were asked to do—but the report has raised more questions than it has answered and leaves an awful lot still in doubt. It says that
“the governance and financial management arrangements are not of themselves sufficiently robust or transparent to evidence value for money”.
I completely accept what the Minister says about corruption—I have never made an allegation of corruption—but we deserve better in Teesside than, “At least it’s not corrupt”. We wanted an NAO investigation; my understanding is that the NAO has offered to conduct such a review, so I am slightly confused about what the Minister just said, which she has obviously been advised to say. Can she confirm that she will write to us with detailed responses to the questions we have raised? Can we please have a meeting with her or an appropriate Minister and officials?
Baroness Swinburne (Con)
I will certainly commit to making sure we follow up on this in detail to the noble Baroness. Given that publication is imminent, I hope we can follow up as and when that happens.
Baroness Swinburne (Con)
I literally have only a minute and a half to finish, and I have about seven responses.
Lord Shipley (LD)
I will happily wait a bit longer if that helps. As part of that letter, because the Minister has said that it is not the job of the NAO to audit this body, will she tell the House whose responsibility audit is?
Baroness Swinburne (Con)
As I have just agreed, I will come back to noble Lords with a response on this, and we can follow up in detail.
I will try to flip through a few points; I will not be able to do them justice, given that we have 45 seconds. The reality here is that there are lots of things going on. On the funding allocation through the towns fund, the noble Lord, Lord Mawson, asked how much has been spent. The towns fund, one of our flagship local growth funds, is on track to be spent by 2026, and the rates at which the projects are being completed is consistent with the delivery timelines we have already set out. We are aware that major regeneration projects take time to deliver, and it is expected that all the funds not spent at this point will be on track to be delivered.
The noble Baroness, Lady Donaghy, referred to the long-term plan for towns. Its key features include an allocative rather than a competitive process over a 10-year period, giving local authorities the flexibility to invest in interventions based on evolving local needs and priorities. I hope that helps with that. There were also various comments on transport. With regard to working with others in the community—the right reverend Prelate raised this—we have all sorts of answers we can give noble Lords. I will follow up in writing to many noble Lords.
I will conclude by saying that we recognise the scale of the challenge to regenerate former industrial areas. We believe wholeheartedly in their potential to thrive, not least because of the pride, spirit and resilience that these communities continue to show. I agree with all noble Lords that this is about people. We need to work hand in glove with local communities to make sure we deliver the regeneration they need. I look forward to continuing discussions and working with all noble Lords to deliver for these communities.
Lord Mawson (CB)
Can I just make a correction? I asked about not the towns fund but the levelling up fund. Maybe the Minister can write to us and just tell us what percentage of money has actually been spent, and what that might tell us about the machinery of the state and its ability to deliver on any of this.
Baroness Swinburne (Con)
As a Minister in the department, I want to know that answer, so I will do that.
Baroness Armstrong of Hill Top (Lab)
My Lords, I thank everyone for the debate. It is probably presumptuous of me to say so, but it was refreshing to be in a debate with so many people who found their allegiance to the north-east region. It is unusual in this House so I welcome it, but I also welcome the comments from other parts of the country.
I am really pleased that the Minister has now got this brief and is, I hope, determined to get stuck into it. There is so much to do. I am pleased that she will go to Bishop Auckland. I know it very well, as many of my family live there and were brought up there. She will find that there is a remarkable local benefactor, Jonathan Ruffer, who bought the bishop’s castle and the artwork. I think he says he spends about £10,000 a day. He has done so for the past decade and continues to do so. I know he is pleased about the levelling-up money, but he also thinks that it is not before time. Indeed, at a public meeting he threatened to cease putting any money in unless the Government got serious about the consultation with local people and what goes on with the levelling-up money.
We had some fascinating insights into things that work, but also into things that do not. My good friend—I am sure he does not mind me calling him that—the noble Lord, Lord Mawson, has done some remarkable work on rebuilding communities. I do not agree with everything because I think that if systems do not work, like they are not working in Tees Valley, people suffer. We need systems and processes that recognise who people are, where they are from, what they can do and what they can contribute. That is what I call for and what I am keen to see.
Regeneration in post-industrial sites is complex and difficult. The noble Lord, Lord Shipley, gave an interesting and important example from Newcastle city centre of just what it takes to redevelop a brownfield site, but we have to get on with it and find ways to have public sector investment and understanding of how to make sure that these things are accountable, in a way that local people understand alongside private investment that they can benefit from. That has got unbalanced in Tees Valley. I think Tees Valley is part of the north-east, which is why I was a bit confused when told that we are going to have a new mayor for the whole of the north-east. We are actually having a mayor for the bit of the north-east that is not Tees Valley, but Tees Valley is still technically part of the region.
I hope that the Minister will go away, think about these things and come back to us with real ways in which we can move forward together so that people around the country get the benefit they need. I will send her a copy of our child poverty report because, unless the Government address that, they will not get good regeneration.
Motion agreed.