Grand Committee
Arrangement of Business
The Deputy Chairman of Committees (Baroness Garden of Frognal) (LD)
My Lords, if there is a Division in the Chamber while we are sitting, the Committee will adjourn as soon as the Division Bells are rung and resume after 10 minutes. I do not think that is very likely at the moment.
Data Protection and Digital Information Bill
Monday 22nd April 2024
(3 weeks, 5 days ago)
Grand CommitteeRead Full debate Data Protection and Digital Information Bill 2022-23 View all Data Protection and Digital Information Bill 2022-23 Debates Read Hansard Text Read Debate Ministerial Extracts Amendment Paper: HL Bill 30-VI Sixth marshalled list for Grand Committee - (18 Apr 2024)
Lord Lucas
Lord Lucas (Con)
My Lords, in moving Amendment 199, I will also speak to the other amendments in this group. In so doing, I declare an interest as the principal proprietor of the Good Schools Guide; we make a lot of use of cookies on our website.
I am completely in favour of what the Government are doing in this part of the Bill as an attempt to reduce cookie consent pollution. It is a tiresome system that we all go through at the moment. The fact that it is tiresome means that, most of the time, we just click on it automatically rather than going through to the details. In a way, it is self-defeating. What the Government are trying to do will very much improve the quality of people’s response to cookies and will make them more aware, in situations where they are asked for consent, that this is important.
However—this will be the request at the end of my speech—between Committee and Report, I would really like to sit down with any noble Lords who are interested and are representatives of the relevant industry to discuss how we should deal with cookies that relate to supporting advertisement delivery. A lot of the web relies on advertisements for the revenue to support itself. By and large, for a lot of sites that you are not asked to pay but from which you get a lot of value, that value is supported by advertising. As a website, if you are going to charge someone for delivering advertising, you have to be able to prove that the advertisement has been delivered and to tell them something about the person to whom you are delivering it. In this process, you are not interested in having individual information. What you want is collective information; you want to know that you have delivered 24,000 copies of this advertisement and know what the audience looks like. You absolutely do not want to end up with personal information.
Within that envelope—absolutely excluding the sorts of cookies that chase you around the internet saying, “Do you want a deckchair?”, just because you bought one two days ago—this is a vital part of the way the internet works at the moment. In Amendments 199 to 201, I suggest ways in which the clauses could be adapted to make sure that that use of cookies—as I say, it does not involve the sharing of personal information; it very much involves collective information—is allowed to continue uninterrupted.
The Deputy Chairman of Committees (Baroness Garden of Frognal) (LD)
My apologies to the noble Lord but his microphone does not seem to be working. I wonder whether he could speak more clearly.
The Deputy Chairman of Committees (Baroness Garden of Frognal) (LD)
It is but I do not think it is working. I do not know whether anybody else is having problems with it.
Lord Lucas (Con)
Okay. It does not quite reach me up here; I could sit down if that would be helpful.
The Deputy Chairman of Committees (Baroness Garden of Frognal) (LD)
No, carry on.
Lord Lucas (Con)
I will try to line up with it better. Amendments 202 to 205 flag concerns with proposed new Regulation 6B, which sets out to remove cookie banners automatically when the technology is available. The concerns very much relate to that last phrase: “when the technology is available”. How will this work? How is it to be managed? There is only a thin layer of controls on the Government in the way that they will use these new powers; it is also unclear how this will affect consumers and advertisers. There could be some far-reaching effects here. We just do not know.
I am looking for, and hope the Government will agree to, wide consultation because, on something such as this, it is never true that everybody knows everything. You want to put the consultation out to a lot of different people with a lot of different experiences of how to use the net to make sure that what you are doing will have the sort of effects that you want. I want to see proper, thoroughgoing impact assessments, including of the impact on competition and on the economic health of participants in the net. I would like to see a real analysis of the readiness of the technology, not just an assumption that, because somebody likes it, it will work, but a real, critical look at whether the technology is actually up to what it is hoped it will do, and proper testing, so that, in giving the Government the carte blanche that they have asked for with these clauses, we do not end up letting ourselves in for a disaster.
As I said, most of all, I am looking for a meeting between now and Report, so that I can go through these things in detail, and we can really understand the Government’s position on these matters and, if necessary, discuss them further on Report. I beg to move.
Viscount Chandos (Lab)
My Lords, I will speak briefly in support of the amendments in the name of the noble Lord, Lord Lucas, to which I am pleased to have added my name. I apologise for not being able to speak at Second Reading, but I understand from other Members of the Grand Committee that an occasional guest appearance and a different voice are welcome.
I declare an interest, as set out in the register, as a director of RSMB Ltd, a company specialising in the methodology of audience measurement, cross-media measurement and data integration. More fully, I am nominated and remunerated by the advertising group Havas, which owns the company jointly with Kantar Media.
As the noble Lord, Lord Lucas, so clearly set out in his introduction, these simple and uncontroversial amendments would bring greater clarity and certainty to the key measurement of users, readers and audiences of digital websites and platforms. By including the measurement of aggregate audiences online in the list of cookies that would not require specific consent, these amendments would protect and enhance the interests of both consumers and businesses: consumers because, as the noble Lord, Lord Lucas, said, with the maintenance of advertising revenue funding, websites that provide news, entertainment and a wealth of other services would otherwise cost those consumers much more in subscriptions; and businesses, as through the quality of anonymised, aggregated data, they can build better offers to consumers and advertisers, as well as increase their financial resilience.
The Minister brings profound knowledge and understanding of this field, so he well knows how important the digital advertising market is and how innovative and respected UK companies are in the global industry. That applies not only to the websites, platforms and advertisers but to the research, quality audit and measurement companies specialising in this area. These amendments would support this growing and productive high-tech data, research and measurement sector in reinforcing its world-leading position.
As in so many industries and sectors of the economy, long-term stability is vital to rapidly evolving digital markets. Including these amendments in the Bill, rather than relying on secondary legislation and regulation to flesh out details in the future, will enhance that stability.
Likewise, the amendments relating to the implementation of centralised opt-out controls are intended also to promote that long-term stability, as well bringing enhanced transparency and scrutiny. The interests of consumers and businesses are not in conflict with each other in relation to audience measurement and data quality. They are constructively interactive.
Lord Bassam of Brighton (Lab)
My Lords, Clause 109 makes changes to the regulations relating to the use of cookies, which, on the face of it, clarify and expand the PEC regulations. Some of the amendments seem benign enough, adding useful flexibility and much-needed clarity; others give the Secretary of State pretty wide-sweeping powers.
Taking a look at new Regulation 6A(1)(a), for example, a future Secretary of State will be able to add new exceptions to the cookie consent requirements. The regulation will also enable variations and omissions. All the Secretary of State would need to do is “consult” the commissioner and such other persons as the Secretary of State considers appropriate—so they will be left with some fairly wide powers and opportunities.
Before turning to Amendment 202 in the name of my noble friend Lady Jones of Whitchurch, I want to quickly respond to Amendments 199, 200 and 201, from the noble Lords, Lord Lucas and Lord Clement-Jones, and very ably supported by my noble friend Lord Chandos. These seek to introduce an additional exemption for cookies used for the purposes of non-intrusive audience measurement and ad performance, both of which are obviously very important to publishers, who need to understand how their websites are used and ensure that advertising is delivering revenue. It is famously hard to predict how successful advertising is; you are never quite sure whether the adverts are hitting home, but this sort of data is critical to that activity.
As noted by others, the Bill currently contains an exemption for cookies used solely for statistical purposes. It may be that the Minister is able to provide comfort to the publishing sector that audience measurement and ad performance are both areas that fall within this new exemption. If he cannot do that today, I hope he will be able to come back to interested colleagues in writing or, as the noble Lord, Lord Lucas, suggested, hold further discussions on this ahead of Report.
We had a number of significant debates during the passage of the Digital Markets, Competition and Consumers Bill regarding the fragility of the publishing sector. Newspapers, sectoral magazines and other sources fulfil a valuable role and we should seek to nurture that as far as is practical.
Amendment 202 in the name of my noble friend is another means of trying to support publishers by probing the potential consequences of the Government’s proposals around centralised cookie controls. Some users may happily accept cookies from the websites of trusted organisations, such as news sources that they use regularly, but generally decline cookies from other websites due to privacy concerns. I would like to know from the Minister how this nuance would be reflected if automatic preferencing is rolled out.
Organisations have also raised competition concerns. The number of mainstream internet browsers is incredibly small and they are operated by firms likely to be designated as having strategic market status under the digital markets Bill. If this legislation establishes a system that makes these browsers some kind of cookie gatekeeper, does that not risk amplifying existing competition barriers in digital markets, rather than bringing them down?
Our amendment would remove provisions around automatic cookie consent. Amendment 203 in the name of the noble Lord, Lord Lucas, proposes a different option, providing a straightforward means for users to override their general preference when using specific websites. That is an interesting alternative, and we need to listen carefully to the Minister’s reply because it gets to the heart of the issue. The noble Lord’s Amendment 204 would also be important, ensuring broader consultation before statutory instruments were brought forward under new Regulation 6B.
Lord Clement-Jones (LD)
My Lords, I do not know how unusual this is, but we are on the same page across both sides of the Committee.
First, having signed the amendments by the noble Lord, Lord Lucas, I express my support for the first batch, Amendments 199 to 201, which are strongly supported by the Advertising Association and the Interactive Advertising Bureau for obvious reasons. The noble Lords, Lord Lucas and Lord Bassam, and the noble Viscount, Lord Chandos, have expressed why they are fundamental to advertising on the internet. Audience measurement is an important function, for media owners in particular, to determine the consumption of content and to price advertising space for advertisers.
I understand that the department, DSIT, has conceded that most of the use cases for audience measurement fit within the term “statistical purposes”. It is this area of performance that is so important. As the noble Lord, Lord Bassam, seemed to indicate, we may be within touching distance of agreement on that, but the Minister needs to be explicit about it so that the industry understands what the intent behind that clause really is. As a number of noble Lords have said, this is a specific and targeted exemption for audience measurement and performance cookies that limits the consent exemption for those purposes and, as such, should definitely be supported. I very much hope that, if the Minister cannot give the necessary assurance now, then, as a number of noble Lords have said, he will engage in further discussions.
Amendments 203, which I have signed, and 205 are extremely important too. Amendment 203, picked up clearly by the noble Lord, Lord Bassam, is potentially important; it could save an awful lot of aggravation for users on the internet. It is potentially game-changing given that, when we approach the same site—even Google—we have to keep clicking the cookie. I very much hope the Minister will see the sense in that because, if we are changing the EC regulations, we need to do something sensible and useful like that. It might even give the Bill a good name.
As all noble Lords have rightly said, the Secretary of State needs to think about the implementation of the regulations and what they will affect. Amendment 202 is fundamental and badly needed. You need only look at the list of those who are absolutely concerned about the centralisation of cookies: the Internet Advertising Bureau, the Advertising Association, the Data & Marketing Association, the Market Research Society, the News Media Association, the Incorporated Society of British Advertisers, the Association of Online Publishers and the Professional Publishers Association. I hope that the Government are in listening mode and will listen to their concerns.
As the PPA says, centralising cookie consent with browsers could cause consumers far more harm than good. The Secretary of State’s powers would override cookie consent relationships between individuals and specialist publishers, which the noble Lord, Lord Bassam, talked about in particular. As the PPA says, in all likelihood a significant number of internet users would not consent to cookies from the browser but would consent to cookies on the websites of publishers that they know and trust. If the Secretary of State were to use this power to enforce cookie centralisation, many publishing businesses would be forced to present consumers with paywalls in order to be financially sustainable. As the PPA says, this would lead to consumers missing the opportunity to access high-quality publishing content without having to pay a fee.
The PPA has made an extremely good case. This would amplify existing barriers to competition in the digital market. There are provisions in the DMCC Bill that would give powers to the CMA to address any problems, such as enforced data sharing from platforms to publishers, but centralising cookie consent would completely undermine the objectives of that legislation. It is clear that this Bill should be amended to withdraw the provisions giving the Secretary of State the power to introduce these centralised cookie controls. I very much hope that the Minister will have second thoughts, given the weight of opinion and the impact that the Secretary of State’s powers would have.
Baroness Stowell of Beeston (Con)
My Lords, if the Committee will indulge me, I was a little late arriving for the introduction to this group of amendments by my noble friend Lord Lucas, but I heard most of what he said and I will speak briefly. I am quite sympathetic to the arguments about the exemption being too tightly drawn and the advantage that this is likely to give the likes of Google and Meta in the advertising ecology. As the noble Lord, Lord Clement-Jones, said, a range of different trade bodies have raised concerns about this, certainly with me.
From my perspective, the other point of interest that I want to flag is that the Communications and Digital Committee is currently doing an inquiry into the future of news. As part of the evidence that we have taken in that inquiry, one of our witnesses from the news industry raised their concerns about a lack of joined-up thinking, as they described it, within government when it comes to various different bits of legislation in which there are measures that are inadvertently detrimental to the news or publishing industry because there has been no proper understanding or recognition of how the digital news environment is now so interconnected. Something like this, on cookies, could have quite a profound effect on the news and publishing industry, which we know is reliant on advertising and is increasingly feeling the pinch because the value that it gets from digital advertising is being squeezed all the time. I just wanted to reinforce the point, for the benefit of my noble friend the Minister, that concern about this is widespread and real.
Lord Harlech (Con)
My Lords, it is a pleasure to make my first foray at the Dispatch Box on this Bill in what has been an interesting Committee stage thus far. I thank my noble friend Lord Lucas and the noble Baroness, Lady Jones of Whitchurch, for tabling these amendments and other noble Lords who have signed and spoken to them in support.
Many people are irritated by repetitive pop-ups that appear on websites seeking consent for cookies and other similar technologies. The current cookie rules apply to all organisations placing cookies on a person’s device. Rather than engaging with these banners, people will select “accept all” so that they can access the webpage as quickly as possible. We want users to be able to make more meaningful choices over their privacy. One way in which web users may be able to reduce the number of consent pop-up banners that they see is by using automated consent management technology.
New Regulation 6B, which Amendment 202 seeks to remove, is important as it will allow the Secretary of State to require relevant technologies to meet certain standards or specifications, thereby ensuring that individuals using this technology have effective control over their privacy when they are online. Amendment 203 seeks to amend Regulation 6B by making it clear that consents given on individual websites should override any prior choices made using automated technology. However, this could pre-empt the outcome of consultation with relevant sectors, civil society and regulators on the design of any new regulations. I fear that this amendment could have the effect of encouraging the continued use of consent banners, may not reduce the overall number of pop-up banners and could increase the risk of influencing consumers to give up more personal data than they intended.
We feel that Amendments 204 and 205 are unnecessary and duplicate existing requirements and standard practice. There is already a requirement in new Regulation 6B to consult. We have engaged extensively with stakeholders on this Bill and will continue to do so in the context of using any of the new regulation-making powers linked to these clauses. Our engagement so far has highlighted the complexity of the ecosystem and the range of impacts on different interest groups. We will continue to consider these impacts carefully when considering whether to use the new regulation-making powers. Impact assessments are generally required for all interventions of a regulatory nature that affect the private sector, civil society organisations and public services.
The Government have taken powers in the Bill to remove consent requirements for other purposes if the evidence supports it while recognising that this is a complex and technical market. The Government will therefore continue to engage fully with all players before introducing any new exemptions or deciding to set standards for the market.
The new power in Regulation 6B recognises that there is a range of different stakeholder interests that would need to be considered before making regulations. The Secretary of State must consult the Information Commissioner, the Competition and Markets Authority and any other person the Secretary of State considers appropriate. While browser-based or centralised consent options have been discussed as a possible solution, nothing in the Bill mandates them. The regulation-making power, which follows the affirmative resolution procedure, would allow the Secretary of State to set standards of design that will be key to ensuring that the regulations can move with technology.
Amendments 199 and 200 would permit the storage of information or accessing information stored on a person’s connected device, including the internet of things, to enable the organisation to generate audience measurement information. This proposed new exemption does not explain what data would need to be gathered to meet the objective of the amendment and is potentially broad in its application. For example, if it permitted activities such as tracking and profiling, it may not be appropriate to permit it without the consent of web users.
Lord Bassam of Brighton (Lab)
I am interested in the Minister’s point about the flexibility the Government see in this clause, but I am not sure who in the end has the responsibility to lead on that flexibility. Will it come from the commissioner or be driven by the Secretary of State’s considerations? The consultation duties seem very dependent on the commissioner’s view and I am not sure at what stage the Secretary of State would want to intervene to ensure that they have got this bit right. That is very important, because the balance is quite sophisticated.
Lord Clement-Jones (LD)
The Minister used the expression “when the evidence emerges”, as did the noble Viscount, Lord Camrose, in another context last week. I would have thought that these organisations know what they are about, and they have provided some pretty comprehensive evidence about the impact on their businesses. Is that not a pretty good reason for the Government to think that they might not have this set of provisions entirely right, quite apart from the other aspects of this group of amendments? If that evidence is not enough—I read out the list of organisations—the Government are more or less saying that they will not accept any evidence.
Lord Harlech (Con)
I thank both noble Lords for their interventions. On the point from the noble Lord, Lord Bassam, there is a trifecta of decision-making between the Secretary of State, the ICO and the organisations all working together. That is why there is a consultation requirement before using the power. On the point from the noble Lord, Lord Clement-Jones, it is a question of your point of view; we feel that we have done stakeholder engagement and believe that we have got the balance right between the needs of organisations—
Lord Clement-Jones (LD)
Will the Minister write and unpack exactly what the balance of opinion was? We are talking about pretty crucial stuff here. It is not always a question just of numbers; it is quite often a question of weighting the arguments. The Minister should write to us and tell us how they came to that conclusion, because the case was clearly being made during the consultation, but the Government have effectively ignored it.
Lord Bassam of Brighton (Lab)
In this tripartite geography that the noble Lord described, the power—
Lord Bassam of Brighton (Lab)
I am not a gambling man. It is an interesting term. The Minister is suggesting that power rests equally among those three elements but it does not. The Secretary of State is the all-powerful being and the commissioner is there to ensure that regulation works effectively. How will this operate in practice? There is no advisory body here; it is the Secretary of State having a discussion with the commissioner and then, on the balance of some of the consultation information that comes in, making a decision. That will not enable the sector, the market and those providers to be engaged.
Lord Harlech (Con)
I thank noble Lords for those further points requesting clarification. On how we have come to this decision, I am happy to write to all noble Lords in the Committee. The noble Lord went in an interesting direction because, in the context of the rest of the Bill, so many of the amendments have been about protecting private users, but the noble Lord seems to be swaying more in favour of the advertisers here.
Lord Clement-Jones (LD)
My Lords, it is all about the relative importance and the weighting. Maybe that is a good illustration of where the Government are not getting their weighting correct for the beginning and this part of the Bill.
Lord Harlech (Con)
I take the noble Lord’s point. We are working with industry and will continue to do so. For the benefit of the Committee, we are, as I said, happy to write and explain the points of view, including those from Data: A New Direction. In response to the noble Lord, Lord Bassam, power ultimately lies with Parliament via the affirmative resolution procedure for the Secretary of State power.
I will go back to the amendments we were discussing. This regulation applies to complex and technical markets. The very reason we have taken a delegated power is so that the new exemptions can be carefully created in consultation with all affected stakeholders. As I explained, the Bill includes a requirement to consult the Information Commissioner, the Competition and Markets Authority and any other relevant stakeholders, which would include trade associations and consumers or web users.
Amendment 201 would widen the application of the “strictly necessary” exemption. Currently, it applies only to those purposes essential to provide the service requested by the user. Amendment 201 would extend this exemption so that it applies to the purposes considered essential to the website owner. We do not think this would be desirable, as it would reduce a user’s control over their privacy in a way that they might not expect.
For the reasons I have set out—and once again reaffirming the commitment to write to noble Lords on how the weighting was worked out—I hope my noble friend and the noble Baroness will not press their amendments.
Lord Harlech (Con)
My Lords, my noble friend makes a good point. I can promise all Members that there will be thematic meetings between Committee and Report.
Lord Lucas (Con)
My Lords, I am grateful for that assurance from my noble friend.
On the first amendments, clearly, we are dealing with something that is quite tricky and technical. My noble friend sees these amendments in a different light to me. It is possible that my drafting may be imperfect; that has never happened before, of course, but there is always a first time. Therefore, I seek an opportunity to look at this issue in detail. It is absolutely not my objective to engage the objections; this is something where my noble friend’s objections are valid. My amendment is not intended in any way to allow tracking or profiling. If I am wording things imperfectly or imagining something that just cannot be achieved in practice, the best way to deal with these matters would be to hammer them out in a technical discussion, not in Committee. I would happily look to an opportunity to do that between Committee and Report.
When it comes to new Regulation 6B and its ramifications, as the debate has gone on, I have found myself favouring more and more the amendment in the name of the noble Baroness, Lady Jones of Whitchurch. This is an uncontrolled bit of power that we are looking to give the Government, with some serious implications. It should not be done. We should wait until the technology is available and then do something when we can really take our time to look at the options. Again, this is something that we will have a chance to talk through.
It is really important that, in doing what seems to be convenient—as my noble friend put it, it is about getting rid of an irritation and making the whole process of giving permission much more effective; I am absolutely with him on that—we make sure that we are not letting ourselves in for some greater dangers. I personally want to make sure of that. The oldies among us—most of us, I suspect—will remember when Google said, “Don’t be evil”. I wish that it had kept to that.
For now, I beg leave to withdraw my amendment.
Viscount Camrose
“(1A) In regulation 5C of the PEC Regulations (personal data breach: enforcement)—(a) in paragraph (4)(f), for “from the service of the notice of intent” substitute “beginning when the notice of intent is served”, and(b) in paragraph (5), for “21 days of receipt of the notice of intent” substitute “the period of 21 days beginning when the notice of intent is received”.”Member's explanatory statement
This amendment adjusts the language of regulation 5C of the Privacy and Electronic Communications (EC Directive) Regulations 2003 so it is consistent with language used in new provisions inserted into those Regulations by clause 116 of the Bill.
“(iii) after the third subparagraph insert—“This paragraph is to be interpreted in accordance with Article 3 of Regulation (EEC, Euratom) No. 1182/71 of the Council of 3 June 1971 determining the rules applicable to periods, dates and time limits.”, and” Member’s explanatory statement
This amendment provides for the rules of interpretation in Article 3 of Regulation No 1182/71 (rules of interpretation regarding periods of time etc) to apply to Article 2(2) of Regulation (EU) No 611/2013 on the measures applicable to the notification of personal data breaches.
Viscount Camrose
“Emergency alerts: interpretation of time periodsIn regulation 16A of the PEC Regulations (emergency alerts), in paragraph (6), for the words from “7 days” to “paragraph (3)(b)” substitute “the period of 7 days beginning with the day on which the time period specified by the relevant public authority pursuant to paragraph (3)(b) expires”.”Member’s explanatory statement
This amendment adjusts a description of a period of time in regulation 16A(6) of the Privacy and Electronic Communications (EC Directive) Regulations 2003 to clarify that the day on which the time period specified under regulation 26A(3)(b) expires (which triggers the 7 day period mentioned in regulation 16A) is included in the 7 days.
Lord Leong
“Prohibition on unsolicited calls regarding personal injury claims(1) The PEC Regulations are amended as follows.(2) In regulation 21 (calls for direct marketing purposes), in paragraph (6), leave out “or 21B” and insert “21B or 22A”.(3) In regulation 22 (use of electronic mail for direct marketing purposes), after paragraph (4) insert—“(5) Paragraph (1) does not apply to a case falling within regulation 22A.”(4) After regulation 22 insert—“22A Unsolicited calls and use of electronic mail by claims management companies for personal injury claims(1) A person must not—(a) use, nor instigate the use of, a public electronic communications service for the purpose of making unsolicited telephone calls for direct marketing, and(b) transmit, nor instigate the transmission of, unsolicited communications for the purpose of direct marketing by means of electronic mail or otherwise,if the conditions in subsection (2) are met.(2) The conditions are that—(a) the person making or instigating the call or transmitting or instigating the use of electronic mail—(i) is acting on behalf of a claims management service, or(ii) does so with a view to providing information to a claims management service, and(c) the purpose of the call or the electronic mail is to engage a consumer in commencing a claim for a personal injury. (3) In this regulation—“claims management service” has the meaning given by section 419A of the Financial Services and Markets Act 2000;“unsolicited” means an approach which has not been specifically requested, even if a person has consented to receive marketing information;“claim for a personal injury” means proceedings in which there is a claim for damages in respect of personal injuries to the claimant or any other person or in respect of a person’s death, and“personal injuries” includes any disease and any impairment of a person’s physical or mental condition.””Member's explanatory statement
This new Clause seeks to implement an outright ban on cold calling and spam texts from claims management companies for personal injury claims. Claims management companies would only be allowed to contact people about personal injury claims if they have specifically requested to be contacted about a potential claim.
Lord Leong (Lab)
My Lords, in moving this amendment, I will also speak to the other amendments in this group in the name of my noble friend Lady Jones of Whitchurch: Amendments 209 to 211 and 215.
It is estimated that a staggering 134 million personal injury compensation calls and texts have been made and sent in the UK in the past 12 months. YouGov research shows that more than 20 million people were contacted by companies touting for business through injury compensation claims. Personally, I have had more than my fair share, so I suppose I must declare an interest in this issue.
However, unsolicited calls are more than just a modern-day nuisance. If people have suffered an accident, they can be reminded of the trauma. People’s hopes of compensation can be raised cynically and unrealistically in order to encourage them to share personal financial information that can then be used to scam them out of their money. Research shows strong emotional responses to these calls. People are left feeling angry, anxious, disgusted and upset. That is hardly a surprise when they are being pestered in their own homes or on their own phones.
Lord Kirkhope of Harrogate (Con)
My Lords, I support Amendment 208A. I declare my interest as a solicitor but not one who has been directly involved with personal injury claims. This is an area of particular specialism that requires particular expertise and experience for it to be carried out to the best advantages of those who seek that help.
Looking back, I am concerned that this matter has been raised, in different fora, on a number of occasions. For instance, in 2016, the Telephone Preference Scheme opt-out was discussed when it was removed from the control of Ofcom to that of the ICO. At that point, there was a great opportunity for this matter to be dealt with. Indeed, a number of organisations, including personal injury lawyers, the Motor Accident Solicitors Society and others, said that it was vital to carry this out and that cold calling should be ended because of the pressures it placed on an awful lot of very vulnerable people.
Since 2016, things have got worse in one respect—although, perhaps, they are a little less bad in respect of telephone calling. It is a little while now since I was last told that I had just had a major accident in my car as I was sitting enjoying a glass of wine and not having such worries in my mind. Telephone cold calling seems to have diminished but pressures through social media contact, various scams and so on have increased dramatically. I have been told this by a number of my legal colleagues.
In 2023, the Government produced the UK’s Fraud Strategy. As I am sure noble Lords will know, when it was published, it specifically pursued the question of extending the ban on cold calling to personal injury cases; that was very important and included all servers. So, unless there is some relationship already in place—something where that is a defence, as it were, here—and a voluntary willingness on the part of those who suffer from personal injuries to be contacted by an organisation with which they already have a relationship, this is something that we should pursue very strongly indeed.
Although it is correct that the legal profession, and perhaps other professions, are banned from this procedure, on a regulatory or disciplinary basis, some of my colleagues in the profession are, in some cases, susceptible to financial and commercial challenges through these organisations, such that they would become—sometimes, almost inadvertently—part of the process. Therefore, I hope that, in passing such an amendment, we would give a clear sign to the Solicitors Regulation Authority and the Law Society that it underlines yet again that these practices are not acceptable to those members of the profession.
Lord Clement-Jones (LD)
My Lords, I support Amendment 208A. I am a recovering solicitor. Many moons ago, I gave public affairs advice to the Association of Personal Injury Lawyers, which is a fine organisation. I very much support its call and this amendment on that basis. I congratulate the noble Lord, Lord Leong, on his introduction to this amendment; he and the noble Lord, Lord Kirkhope, made a terrific case.
APIL took the trouble to commission research from YouGov, which showed that 38% of UK adults had received a cold call or text while 86% had a strong emotional response and were left feeling annoyed, angry, anxious, disgusted or upset. Therefore, the YouGov research reveals that almost all those who received a call supported a total ban on personal injury cold calls and text messages.
There is little for me to add but I am sorry that the noble Baroness, Lady Buscombe, is not with us—she has just exited the Room, which is unhappy timing because, in looking back at some of the discussions we have had in the House, I was about to quote her. During Report stage in the Lords on the Financial Guidance and Claims Bill, when she was a Minister, she told us:
“We know that cold calls continue and understand that more needs to be done truly to eradicate this problem. We have already committed to ban cold calls relating to pensions, and are minded to bring forward similar action in relation to the claims management industry. I have asked officials to consider the evidence for implementing a cold-calling ban in relation to claims management activities, and I am pleased to say that the Government are working through the detail of a ban on cold calling by claims management companies. There are complex issues to work through, including those relating, for example, to EU directives”;
of course, we do not have those any more. She went on to say:
“We would therefore like time to consider this important issue properly, and propose bringing forward a government amendment in the other place to meet the concerns of this House”.—[Official Report, 24/10/17; col. 861.]
How much time do the Government need? Talk about unfinished business. I know it is slightly unfair as you can unearth almost anything in Hansard but the fact is that this is bull’s eye. It is absolutely spot on on the part of APIL to have found this. I thought for one delirious minute that the noble Baroness, Lady Buscombe, was going to stand up and say, “Yes, I plead guilty. We never pursued this”.
Lord Evans of Rainow (Con)
I have texted the noble Baroness asking her to return as soon as possible so that she can listen to the noble Lord’s wise words.
Lord Clement-Jones (LD)
I am not going to carry on much longer. I know that that will be a grave disappointment but it makes the case, I think, that it is high time that the Government did something in this area. It is clearly hugely unpopular. We need to make sure that Amendment 208A is passed. If not now, when?
Lord Harlech (Con)
My Lords, I thank the noble Baroness, Lady Jones of Whitchurch, for tabling Amendment 208A and the noble Lord, Lord Leong, for moving it. This amendment would insert new Regulation 22A into the privacy and electronic communications regulations and would prohibit via email or text unsolicited approaches encouraging people to commence personal injury claims sent by, or on behalf of, claims management companies.
The Government agree that people should not receive unsolicited emails and texts from claims management companies encouraging them to make personal injury claims. I assure noble Lords that this is already unlawful under the existing regulations. Regulation 22(2) prohibits the sending of all unsolicited electronic communications direct marketing approaches—including, but not limited to, texts and emails—unless the recipient has previously consented to receiving the communication. Regulation 21A already bans live calling by claims management companies.
In the past year, the Information Commissioner has issued fines of more than £1.1 million to companies that have not adhered to the direct marketing rules. Clause 117 considerably increases the financial penalties that can be imposed for breaches of the rules, providing a further deterrent to rogue claims management and direct marketing organisations.
Amendments 211 and 215 relate to Clause 116 so I will address them together. Amendment 211 seeks to confirm that a provider of a public electronic communications service or network is not required to intercept or examine the content of any communication in order to comply with the new duty introduced by Clause 116. I assure the noble Baroness and the noble Lord that the duty is a duty to share information only. It merely requires providers to share any information that they already hold or gather through routine business activities and which may indicate suspicious unlawful direct marketing on their networks; it does not empower, authorise or compel a communications provider to intercept messages or listen to phone calls.
Should a communications provider become aware of information through its routine business activities that indicates that unlawful direct marketing activity may be taking place on its service or network, this duty simply requires it to share that information with the Information Commissioner. For example, a communications provider may receive complaints from its subscribers who have received numerous unsolicited direct marketing communications from a specific organisation. We know from the public consultation that people want action taken against nuisance calls and spam, and this duty will support that.
Lord Leong (Lab)
My Lords, I thank all noble Lords who have spoken, especially the noble Lords, Lord Kirkhope and Lord Clement-Jones, who have kindly supported this amendment.
I shall just make two points. The first is that “unlawful” is just not good enough. People are still carrying on making these cold calls. Sometimes we have to listen to experts. The Law Society says that they are banned from making cold calls, and the Association of Personal Injury Lawyers is asking for a ban. Sometimes, as politicians, we need to listen to people who perhaps know more than we do. If they are asking for it, it is basically because they need this clarified. I hope that the Minister will look at this again.
As for Amendments 211 and 215, perhaps the Minister could share with me the detail of the various points just made about the sharing data with various other stakeholders. If he could write to us or share it with us, that would satisfy our position.
On that basis, I beg leave to withdraw the amendment.
Member’s explanatory statement
This amendment would remove the introduction of soft opt-in for political parties and campaigners, whose activity is governed by other regulation.
Baroness Jones of Whitchurch (Lab)
My Lords, in moving Amendment 209, I will also speak to Amendment 210, and I thank the noble Lord, Lord Clement-Jones, for adding his support.
These amendments return to the major debate that we had on day 2 in Committee regarding direct marketing for the use of democratic engagement. It is fair to say that no-one was convinced by the Minister’s arguments about why that relaxation of the rules for political parties was necessary. We will no doubt return to that issue on Report, so I shall not repeat the arguments here. Meanwhile, Clause 113 leads into the democratic engagement provisions in the Bill and provides a soft opt-in for the use of electronic mail for direct marketing for charitable, political or other non-commercial activities when the data has been collected for other purposes.
As we made clear in the previous debate, we have not asked for these more relaxed rules about political electronic marketing. We believe that these provisions take us fundamentally in the wrong direction, acting against the interests of the electorate and risking damaging the already fragile level of trust between politicians and voters. However, we support extending the soft opt-in for charities and other non-commercial organisations. This is a measure that many charities have supported.
Of course, we want to encourage campaigning by charitable organisations to raise awareness of the critical issues of the day and encourage healthy debate, so extending their opportunities to use electronic marketing for this purpose could produce a healthy boost for civic engagement. This is what our amendments are hoping to achieve.
Therefore, our Amendments 209 and 210 would amend the wording of Clause 113 to remove the relaxation of the rules specifically for political parties and close the loophole by which some political parties may try to negate the provisions by describing themselves as non-commercial entities. We believe that this is the right way forward. Ideally, these amendments would be combined with the removal of the democratic engagement provisions in Clause 114 that we have already debated.
I hope noble Lords will see the sense of these proposals and that the Minister will agree to take these amendments away and rethink the whole proposition of Clauses 113 and 114. I beg to move.
Lord Clement-Jones (LD)
My Lords, tracking the provenance of Clause 113 has been a very interesting exercise. If we think that Clause 114 is pretty politically motivated, Clause 113 is likewise. These rules relating to the fact that political parties cannot avail themselves of the soft opt-in provision have been there since 2005. The Information Commissioner issued guidance on political campaigning, and it was brought within the rules. Subsequently, there has been a ruling in a tribunal case which confirmed that: the SNP was issued with an enforcement notice and the information tribunal dismissed the appeal.
The Conservative Party was fined in 2021 for sending emails to people who did not ask for them. Then, lo and behold, there was a Conservative Party submission to the House of Lords Democracy and Digital Technologies Committee in 2020, and that submission has been repeated on a number of occasions. I have been trying to track how many times the submission has been made by the Conservative Party. The submission makes it quite clear that there is frustration in the Conservative Party. I have the written evidence here. It says:
“We have a number of concerns about the Information Commissioner’s draft code”—
as it then was: it is now a full code—
“on the use of data for political campaigning. In the interests of transparency, I enclose a copy of the response that the Conservative Party sent to the consultation. I … particularly flag the potential chilling effect on long-standing practices of MPs and councillors from engaging with their local constituents”.
Now, exactly as the noble Baroness has said, I do not think there is any call from other political parties to change the rules. I have not seen any submissions from any other political party, so I would very much like to know why the Government have decided to favour the Conservative Party in these circumstances by changing the rules. It seems rather peculiar.
The guidance for personal data in political campaigning, which I read while preparing for this debate, seems to be admirably clear. It is quite long, but it is admirably clear, and I congratulate the ICO on tiptoeing through the tulips rather successfully. However, the fact is that we have very clear guidance and a very clear situation, and I entirely agree with the noble Baroness that we are wholly in favour of charities being able to avail themselves of the new provisions, but allowing political parties to do so is a bridge too far and, on that basis, I very much support the amendment.
The Parliamentary Under-Secretary of State, Department for Science, Innovation and Technology (Viscount Camrose) (Con)
My Lords, I thank the noble Baroness, Lady Jones, for Amendments 209 and 210, which would amend Clause 113 by removing electronic communications sent by political parties from the scope of the soft opt-in direct marketing rule. A similar rule to this already exists for commercial organisations so that they can message customers who have previously purchased goods or services about similar products without their express consent. However, the rule does not apply if a customer has opted out of receiving direct marketing material.
The Government consider that similar rules should apply to non-commercial organisations. Clause 113 therefore allows political parties, charities and other non-commercial organisations that have collected contact details from people who have expressed an interest in their objectives to send them direct marketing material without their express consent. If people do not want to receive political messaging, we have included several privacy safeguards around the soft opt-in measure that allow people to easily opt out of receiving further communications.
Support for a political party’s objectives could be demonstrated, for example, through a person’s attendance at a party conference or other event, or via a donation made to the party. In these circumstances, it seems perfectly reasonable for the party to reach out to that person again with direct marketing material, provided that the individual has not objected to receiving it. I reassure the Committee that no partisan advantage is intended via these measures.
Lord Clement-Jones (LD)
My Lords, perhaps the Minister could elucidate exactly what is meant by “supporting the party’s objectives”. For instance, if we had a high street petition, would that be sufficient to grab their email address and start communicating with them?
Viscount Camrose (Con)
I suppose it would depend on the petition and who was raising it. If it were a petition raised or an activity supported by a particular party, that would indicate grounds for a soft opt-in, but of course anyone choosing not to receive these things could opt out either at the time or later, on receipt of the first item of material.
Lord Clement-Jones (LD)
So what the Minister is saying is that the solicitor, if you like, who is asking you to sign this petition does not have to say, “Do you mind if I use your email address or if we communicate with you in future?” The person who is signing has to say, “By the way, I may support this local campaign or petition, but you’re not going to send me any emails”. People need to beware, do they not?
Viscount Camrose (Con)
Indeed. Many such petitions are of course initiated by charitable organisations or other not-for-profits and they would equally benefit from the soft opt-in rule, but anyone under any of those circumstances who wished not to receive those communications could opt out either at the time or on receipt of the first communication on becoming aware that they were due to receive these. For those reasons, I hope that the noble Baroness will not press her amendments in relation to these provisions.
Baroness Jones of Whitchurch (Lab)
My Lords, I thank the noble Lord, Lord Clement-Jones, for digging and delving into the background of all this. That is helpful because, all the way through our previous debate, we kept saying, “We don’t understand why these provisions are here”. When the Minister in the Commons was challenged, he said, “We have no intention of using this; it’s just a general power that might be there for anyone to use”, but the noble Lord has put the lie to all that. It is clear that only one party wants to pursue this issue: the Conservative Party.
The Minister said that there is no partisan objective or reason for this but, to be honest, I do not know how he can say that. If only one party wants it and no one else does, then only one party is going to implement it. Without going over the whole of the previous debate, I think a lot of people felt that we as political parties have a lot to do to improve our relationships with the electorate and be seen to represent them on an honest and authentic basis.
This goes in the opposite direction. It is almost collecting data for one purpose and using it for a different one. The noble Lord, Lord Clement-Jones, and the Minister discussed the example of collecting information on a street stall; we have all done that a bit, in that you can put very generalised questions on a questionnaire which could then be used for all sorts of purposes.
Viscount Camrose
Member's explanatory statement
The amendment in my name to insert a new clause after clause 108 will apply the rules of interpretation in Article 3 of Regulation No 1182/71 to the Privacy and Electronic Communications (EC Directive) Regulations 2003. This amendment adjusts the language of new regulation 26A(3) of those Regulations to ensure that Article 3 is able to apply.
Member's explanatory statement
The amendment in my name to insert a new clause after clause 108 will apply the rules of interpretation in Article 3 of Regulation No 1182/71 to the Privacy and Electronic Communications (EC Directive) Regulations 2003. This amendment adjusts the language of new regulation 26B(4) of the 2003 Regulations to ensure that Article 3 is able to apply.
Member's explanatory statement
This amendment adjusts the language of new regulation 26B(5) of the Privacy and Electronic Communications (EC Directive) Regulations 2003 to ensure that Article 3 of Regulation No 1182/71 is able to apply to it and also makes a small change to when the 21 day period starts.
Viscount Camrose
Member's explanatory statement
This amendment is consequential on the amendment in my name to insert a new clause after clause 124.
Viscount Camrose
“Time periods: the eIDAS Regulation and the EITSET Regulations(1) In Chapter 1 of the eIDAS Regulation (general provisions), after Article 3 insert—“Article 3APeriods of timeReferences in this Regulation to a period expressed in hours, days, months or years are to be interpreted in accordance with Article 3 of Regulation (EEC, Euratom) No. 1182/71 of the Council of 3 June 1971 determining the rules applicable to periods, dates and time limits.”(2) The Electronic Identification and Trust Services for Electronic Transactions Regulations 2016 (S.I. 2016/696) are amended as follows.(3) In regulation 2 (interpretation), at the end insert—“(3) References in these regulations to a period expressed in days or years are to be interpreted in accordance with Article 3 of Regulation (EEC, Euratom) No. 1182/71 of the Council of 3 June 1971 determining the rules applicable to periods, dates and time limits.”(4) In Schedule 1 (monetary penalties)—(a) in paragraph 4(f), for the words from “a period” to the end substitute “the period of 21 days beginning when the notice of intent is served”,(b) in paragraph 5, for the words from “a period” to the end substitute “the period of 21 days beginning when the notice of intent is received”, and(c) in paragraph 6, for the words from “a period” to the end substitute “the period of 21 days beginning when the notice of intent is served”.”Member's explanatory statement
This amendment provides for the rules of interpretation in Article 3 of Regulation No 1182/71 (rules of interpretation regarding periods of time etc) to apply to Regulation (EU) No. 910/2014 on electronic identification and trust services and to the Electronic Identification and Trust Services for Electronic Transactions Regulations 2016.
Baroness Kidron (CB)
My Lords, I also submit that Schedule 11 should not stand part of the Bill. I note the amendments from the noble Baroness, Lady Sherlock, which seek to temper the impact of these powers, but they do not go far enough. To have these clauses in a Bill labelled “data protection” contradicts its very title. I thank the noble Baroness, Lady Chakrabarti, and the noble Lords, Lord Clement-Jones and Lord Kamall, for their support. The noble Lord, Lord Anderson, is detained elsewhere but he asked that I raise a number of his concerns. I am grateful for his experience, as I am for the legal opinion provided by Dan Squires KC and Aidan Wills of Matrix Chambers.
The provisions create new powers for the DWP to obtain information about the bank accounts of people who receive benefit payments by requiring financial institutions to monitor customers’ accounts, to identify cases that merit further consideration and to establish whether the relevant benefits are being, or have been, paid in accordance with the law. Paragraph 2(1) of proposed new Schedule 3B makes it clear that the information that can be requested is very wide indeed, although it is not specified.
Schedule 11 also sets out provisions that would allow the DWP to issue account information notices; those AINs would apply to any account into which benefits will be, are being or have been paid within the past year, as well as to any account linked to such an account. The account holder may be a person who is entitled to the benefit or a person who receives the payment on their behalf, such as a parent, partner or carer. It may also include a joint account holder or, where housing benefit is paid direct, a landlord and all their related accounts.
All benefits, both those that are means tested and those that are not—child tax credit, the state pension, personal independence payments, the disability living allowance, working tax credit, universal credit and the employment and support allowance—are in scope. Counsel’s advice is that it is
“reasonable to assume that AINs will be issued on a rolling basis to most financial institutions which provide banking services and, in order to comply, financial institutions would need to subject most, if not all, of their account holders to algorithmic surveillance”.
Counsel also found that an AIN being issued to a particular financial institution would almost certainly be secret, to avoid tipping off account holders, and that the criteria triggering a search would also be kept confidential.
The Social Security Administration Act 1992 already contains powers for the Secretary of State to compel banks and others to provide information in order to ascertain whether a benefit is being paid correctly, as well as to prevent, detect and secure evidence of benefit fraud—that is to say, the DWP already has these powers if it has reasonable grounds to suspect that fraud is taking place. What is proposed is that the DWP no longer has to have a suspicion of wrongdoing but can survey vast swathes of the UK population without their knowledge in order proactively to surface cases that may or may not merit further consideration.
The legal opinion is also pretty damning on whether the powers contravene Article 8 on the possibility of extremely private information—such as on political allegiance and sexuality—being accessed, and it is equally damning on both the practicalities and the lack of oversight. If the noble Lord, Lord Anderson, had been with us, he would have made the following points. First, this is a power to collect highly sensitive personal information in bulk. Such powers exist under the Investigatory Powers Act but are attended by an array of statutory safeguards, ranging from authorisation of the original warrant, which must be approved by an independent judicial commissioner, and checks on the level of material requested to other issues such as record keeping, retention, dissemination and destruction, error reporting and a right to reply to the Investigatory Powers Tribunal. Few, if any, of these safeguards exist in the Schedule 11 power.
Secondly, the full extent and significance of the power will be apparent only once there is a code of practice. However, there is no draft code of practice and no commitment to produce one; there is merely a discretion. This is in sharp contrast to the Investigatory Powers Act, where key excerpts were made available in advance of Committee in both Houses. The impact of Schedule 11 on privacy is arguably much greater, yet we have seen no draft code of practice—indeed, we cannot be sure that a code of practice will be issued at all.
Finally, Schedule 11 contrasts with HMRC’s much more limited power to access information and documents for the purpose of checking a taxpayer’s tax position or collecting a tax debt. Under paragraph 4A of Schedule 36 to the Finance Act 2008, HMRC has been able to authorise a financial information notice on an individual, but not on a bulk basis. An FIN, unlike an AIN, must name the taxpayer to whom it relates. The most recent corporate report records that only 647 FINs were issued in the year to March 2023—an insignificant number in relation to the proposals in front of us. I hope that, when he responds, the Minister will be able to explain why investigating tax fraud is so carefully and narrowly constructed, whereas the DWP measures that will impact many more millions of people, a significant proportion of whom do not even receive benefits, are so broad.
On the day I tabled my amendments, I received an email from a woman who cares for her adult son with complex needs. She has a bank account to receive his benefits, from which she pays for his care. Under the terms of the Government’s proposal, all her bank accounts would be connected to his payments and therefore open to monitoring. Caring for an adult child is a heavy burden for a parent. Many parents do it with a love-filled grace that is humbling to witness, but it is a task that is out of season with the life that most of us live and all of us expect, in which children grow up, leave home and, as our strength wanes, come to our aid. It is also a service that the Government—and, by extension, all the rest of us—rely on.
In 2023, the University of Sheffield and Carers UK estimated that unpaid care, largely from family members, saved UK plc a whopping £162 billion a year, dwarfing the £120 million the Government expect to retrieve by these measures. It is nothing less than cruel to make a claimant or carer anxious, let alone homeless. But, if I cannot appeal to the Government’s compassion, I hope they will consider this: some who have contacted me suggested that they would no longer be prepared to continue to hold accounts on behalf of others; others suggested that their landlords would not be prepared to let them rent; and one said that their mental health had already suffered at the prospect. How many families need to put caring responsibilities back on the state, how many landlords need to make people on benefits homeless and how many people need to seek support from mental health services before the advertised gains are eroded?
For the life of me, I cannot work out whether these measures are intended to hurt or whether a focus on the shiny prospect of AI to sort out the DWP’s problems led incrementally to this place. Whichever it is, the measures are cruel to a degree that should worry us all. In a later group of amendments, we will discuss the capacity for technological systems to malfunction. Horizon might be top of mind, but Nationwide, McDonald’s, Tesco, Sainsbury’s, Greggs, 999, air traffic control and public bodies, including the NHS and DWP, have all experienced technology failures where service provision suffered.
I am not against technology—we live in a world organised by technological systems—but introducing a system that may impact the finances of up to 40% of the UK’s population, including the most vulnerable, the poorest and the oldest, without checks and balances and, indeed, while downgrading the protections on automated decision-making, is dangerous.
Can the Minister can tell the Committee what plans the DWP has for when things go wrong, when people have benefits stopped and their children go hungry because the computer says no? Can he tell us how it will prevent a repeat of the hounding of so-called fraudulent payments, as is currently being reported in relation to the carer’s allowance, until people lose homes, jobs and mental health as a result of overpayments? In many cases, they were the department’s own fault and, in one case, involved as little as 30p a week. What has the department learned from a similar Australian scheme that, over 12 months, resulted in 1 million additional welfare payments being stopped, often without warning and notified by text with no human to complain to? That scheme dissipated as it became unworkable.
Baroness Chakrabarti (Lab)
My Lords, it is a pleasure and a privilege to support that tour de force from the noble Baroness, Lady Kidron. I do not need to repeat it but, to summarise, I completely agree with the opinion from Matrix Chambers that, in addition to its immorality, this provision is in contravention of Article 8 of the European Convention on Human Rights on respect for private and family life—relating to correspondence in particular. It is not necessary or proportionate, as we have heard. It is discriminatory and, for the purposes of the convention, is not in accordance with law. Once more, as we have heard, promising the possibility of guidance in future is no substitute for properly confining a power of this kind. Instead, the power is breathtaking in its scope and in its intrusive nature over the most sensitive financial and other personal information that could be gleaned this way.
It is an intrusion and an indignity as the breaches of privacy are not just for vulnerable people who are on benefits—not only non-means-tested benefits but means-tested benefits too. They are also an intrusion on the financial privacy of those who have linked accounts, whether they are a family member who is helping out by way of paying carers, landlords and so on or a family member who gives a small gift to a vulnerable person on benefits. Perhaps that is the Government’s intention—I do not know—but it is breathtaking in its sweep and in the number of citizens and people in this country who will be caught up in it. That is what makes it disproportionate and not in accordance with law relying on hypothetical guidance.
The discriminatory aspect cannot be emphasised enough. There are, broadly speaking, two categories of people for these purposes in these islands: those who earn, have inherited or otherwise have enough wealth to come within the scope of HMRC and who should pay tax and not avoid it—that is, not defraud other taxpayers and the country as a whole; and those who are on benefits, whether means-tested or universal. Neither category of humanity should be exempt from fraud but nor should there be a discriminatory approach to policing any potential fraud. Why is it that, as we heard from the noble Baroness, Lady Kidron, we have this breathtaking snooper’s charter for those on benefits but a much more targeted approach to those who should be paying taxes? That discrimination cannot be justified.
Baroness Buscombe (Con)
What is the difference between the trawl in looking at people who are seeking to avoid tax, which is not a crime, and in looking at those who are possibly mis-stating the extent of their assets? In the noble Baroness’s view, how is the surveillance different in terms of this Bill?
Baroness Chakrabarti (Lab)
I am grateful to the noble Baroness. It is not just my view. It was put very well by the noble Baroness, Lady Kidron, and, as I recall, is outlined in the legal opinion. HMRC’s powers are more targeted and have more safeguards.
Baroness Buscombe (Con)
When the noble Baroness says, “more targeted”, is what way are they more targeted? That is what I would like to know.
Baroness Kidron (CB)
They relate to individual people by name, not whole sweeps of people who have done nothing wrong but get a particular benefit.
Baroness Chakrabarti (Lab)
What I am advocating to the Committee is that, in terms of our approach in this country to everyone in either category—or to people who are sometimes in both categories because they are, for example, entitled to some universal benefits but none the less must pay tax on their earnings, inheritance or whatever—the appropriate approach is a targeted approach beginning with at least some reasonable suspicion that a person’s financial matters are a cause for concern. Once there is reasonable suspicion—not even hard proof—because of their activities, that should be the trigger for an intrusion into their affairs. We have had that approach to privacy in this country for a very long time; it is the approach that, broadly speaking, is entrenched in Article 8 of the convention. Even if one does not like human rights conventions, it is none the less a tradition that people in this country—not just lawyers—have long understood.
Further, and in reference to the remarks attributed to the noble Lord, Lord Anderson of Ipswich—who is not in his place, which is the reason why I am also risking being sensible—it is absolutely flabbergasting that there are greater checks and balances for investigating matters of national security than for investigating what could be minor benefit fraud. An example is the allegation that the person giving a Christmas present to their pensioner relative or their relative who is not able to work should trigger a response in the algorithm that this is somebody who should no longer be worthy of the benefit or who, worse still, should face criminality or even potential incarceration.
I cannot say how horrified I am that the Government should have proceeded with a measure of this kind even as we still learn about the extent of the injustice perpetrated on the postmasters. After what we are just beginning to understand about the postmasters, I cannot understand why the Government would allow this kind of discriminatory intrusion to be turbocharged by AI and inflict the potential for the same type of injustice—not just for a limited cohort of people who were unfortunate enough to be serving their communities by working as postmasters—on millions of people in the United Kingdom.
This is what Committee on a Bill is for. I will therefore calm myself in the knowledge and belief—and certainly the hope—that, in his response, the Minister will at least offer to meet with Members of the Committee who have put their names to the clause stand part notice from the noble Baroness, Lady Kidron, and with campaigners and experts to hear a little about the detail of the concerns and to compare this provision with the other provisions, as the noble Baroness, Lady Buscombe, suggested in relation to national security, or indeed for tax fraud. Nobody is suggesting that fraud should be perpetrated with impunity, but we must learn from the mistakes of injustices already perpetrated. They are perpetrated because of blanket trust in the authorities and AI and a lack of checks and balances. There were plenty of humans in the loop at the Post Office, but that is not enough. This is a sweeping power that will lead only to intrusion, discrimination and the worst kind of injustice. In the meantime, before that moment even comes, millions of people will live in fear.
Lord Sikka (Lab)
My Lords, I will address, first, the exclusion of Clause 128 and, secondly, Amendment 219 in my name.
I spoke at Second Reading to oppose Clause 128. I was a little too late to put my name to the clause stand part notice in the names of the noble Baronesses, Lady Kidron and Lady Chakrabarti, and the noble Lords, Lord Clement-Jones and Lord Anderson. I would therefore like to address a few things relating to that before I move on.
This clause creates two kinds of citizen: those who are entitled to financial privacy and others who are not entitled to any privacy, just because they happen to be poor, old, sick, disabled, infirm and unfortunate. Hopefully, the Minister can explain the rationale for creating this form of discrimination. This discrimination will particularly affect women, because a lot of women receive social security benefits, and people of colour, who are generally paid poorly and often have to rely upon universal credit and other benefits to make ends meet. Hopefully the Minister will also be able to tell us how this squares with the levelling-up agenda. Certainly this clause does not really provide any fairness at all.
I have received lots of emails and letters and met individuals who are very concerned, as earlier speakers articulated, that they will be made homeless because their landlords will not want their bank accounts to be put under surveillance. What assessment have the Government made of the impact that this clause may have on future homelessness?
Lord Kamall (Con)
My Lords, I will speak in favour of the amendment to which I have added my name, with other noble Lords here today, and also to some of the other amendments in the group. I find it interesting having to follow the noble Lord, Lord Sikka. Quite often we disagree on issues, and we are probably coming at this from different angles, but actually we have come to the same conclusion.
Noble Lords will know of my concerns raised at earlier stages about automated decision-making. We have to ensure that there is always human intervention but, even when there is human intervention, things can go seriously wrong. When I first saw this proposal for mass trawling of bank accounts, I have to say that the first thought that came into my mind was, “This is Big Brother”, so I was not surprised when I received an email and a briefing from Big Brother Watch. I thank Big Brother Watch for its point. I will quickly dip into some of the points made by Big Brother Watch. There are many more points.
People may find it interesting that the noble Lord, Lord Sikka, and I are speaking on this amendment from different angles. Let me be quite clear: I am a classical liberal. Some people call me a libertarian. I believe in a smaller state and government doing less, but there has to be a state to help those who cannot help themselves and people who have fallen on hard times. For some people, that is all they have. They have only the state benefit. There are no local community organisations or civil society organisations to help them, and therefore you have to accept that role for the state.
Those people are quite often the most vulnerable, the least represented and unable to speak up for themselves. I do not want to patronise them, but quite often you find that. When I saw this, I thought, “First of all, this is going to force third-party organisations to trawl”—I use the term advisedly—“customers’ accounts in search of matching accounts”. When we talk about those third-party organisations, we are talking about banks, landlords and a number of other organisations that have some financial relationship with those individuals. Some estimates put it at approximately 40% of the population who could be vulnerable to being trawled.
I am also worried about the precedent that this sets. I know that the noble Lord, Lord Sikka, talked about this in a different way. He would perhaps like this power to be extended. I do not want this power at all. I do not want it to be extended to others. I just do not want it at all.
I also worry about what this surveillance power does to the presumption of innocence. Are we just trawling everyone’s accounts in the hope that they will be found guilty? While I do not always agree with the Information Commissioner’s Office, we should note that it does not view these powers as proportionate.
One general concern that a number of noble Lords have is about AI and, in particular, the transparency of datasets and algorithms. We would want to know, even if we do not understand the algorithm itself, as the noble Lord, Lord Clement-Jones, and I discussed in a debate on earlier amendments, what these algorithms are supposed to be doing and what they are looking for in trawling people’s bank accounts.
There are some precedents to this. We see from financial institutions’ suspicious activity reports that they have a very high false hit rate. I have a friend who is a magistrate, who told me that she heard a case about a family who wanted to get back access to their bank account. She felt that they were under suspicion because of their ethnicity or faith, and said to the bank, “You have not made a clear case for why we should freeze this account. This family has suffered because they are not able to access their bank account”. Think about that mistake being repeated over and over with false positives from this data. The noble Baroness, Lady Kidron, was right to remind us that this is all against the background of the Horizon scandal. Even when people intervene, do they speak up enough to make sure that the victims are heard or does it need an ITV drama to raise these issues?
Baroness Lister of Burtersett (Lab)
My Lords, it is a great pleasure to follow the noble Lord, Lord Kamall. Although we probably come from very different positions on the role of the state, I agree with virtually everything that he said. I apologise for popping up at this late stage of proceedings on the Bill but, as someone with a long-standing concern about social security matters, I was shocked by the inclusion of these powers and want to add my support to those opposing them and, should this opposition prove unsuccessful, to the very sensible set of recommendations made by my noble friend Lady Sherlock.
The Child Poverty Action Group, of which I am honorary president, and Z2K warn that the stakes are high for claimants, as getting caught up in an error and fraud investigation can lead to the wrongful suspension and/or termination of their benefits. They give some horrendous examples of where this has happened. I will read just one: “A claimant with severe mental health problems whose main carer had recently passed away had his UC suspended in October 2023 by the UC case review when he was unable to obtain and upload bank statements on request. The suspension continued for four months and he was unable to pay for food, electricity or heating. When he was referred for benefits advice and his welfare rights adviser contacted the UC case review team, she was told that claims under review are randomly chosen and they are not targeted in any way”. This is someone with mental health problems left without any money; this could become the norm under this proposal.
The briefing from the CPAG and Z2K also cites the perspective of Changing Realities—families with experience in claiming low-income benefits. One warns that
“it will put folk off claiming altogether”.
I always remember, when I worked at the CPAG, getting a phone call from a woman who started by saying, “Please don’t think I’m a scrounger”. I am afraid that is still very much how people often feel about claiming benefits. Treating all social security recipients as potentially fraudulent can but increase the stigma associated with claiming. Amendment 219 in the name of my noble friend Lord Sikka is highly pertinent here. The point has already been made, but how would we feel if we knew that our bank accounts could well be scrutinised for potential tax evasion? I realise that I should declare an interest: as a pensioner, ultimately my bank account will be trawled, but that is down the line. Underlying this is a double standard that has operated year after year in social security and tax fraud.
The CPAG and Z2K also warn that some of the most marginalised people in our society could get caught up in these speculative searches. Given this, can the Minister explain why—I believe this is still the case—there is no equalities impact assessment for these provisions? Disabled people’s organisations are very worried about the likely implications for their members, such as in the case of disabled people who set up bank accounts to pay for their social care. They warn of the potential mental health impact as existing mental distress and trauma could be exacerbated by the knowledge that they are under surveillance—a point made by the noble Baroness, Lady Kidron.
The Government state that they
“are confident that the power is proportionate and would operate in a way that it only brings in data on DWP claimants, and specifically those claimants where there is a reasonable suspicion that something is wrong within their claim”.
Given the evidence of people already being wrongfully targeted for fraud and the strongly expressed view of organisations such as Justice, as well as the Information Commissioner, that the measures are disproportionate and therefore arguably unlawful, can the Minister say on what evidence that confidence is based? Given this confidence, I hope that the Government will accept without demur Amendments 220 to 222 in the next group from my noble friend Lady Sherlock.
Picking up what my noble friend Lord Sikka said, what is the breakdown between suspected fraud and error? It is not helpful that they are always talked about as though they are one and the same thing. The Government have argued that one reason the power is necessary is to provide the tools to enable the DWP to
“minimise the impact of genuine mistakes that can lead to debt”.
Try telling that to recipients of carer’s allowance who have been charged with fraud as a result of genuine mistakes relating to the earnings threshold. The fact that the DWP already has the information and power it needs to act to ensure that debts do not accrue in this situation, yet in countless cases has not used it until the point where very large sums may be owing, does not instil confidence, as mentioned by the noble Baroness, Lady Kidron.
On Amendment 303, which relates to Amendment 230, one of the criticisms of these provisions has been the lack of consultation. Has the Social Security Advisory Committee been consulted? If so, what was its response; if not, why not?
In conclusion, I support the opposition to Clause 128 and Schedule 11 standing part of the Bill, but so long as they do stand part, I hope very much that the Minister will take seriously the amendments in the name of my noble friend in this group and the next two.
Lord Vaux of Harrowden (CB)
My Lords, I was also too late to put my name to these stand part notices for Clause 128 and Schedule 11. There must have been a stampede towards the Public Bill Office, meaning that some of us failed to make it.
At Second Reading, I described Clause 128 as “draconian”. Having dug into the subject further, I think that was an understatement. Data protection is a rather dry subject and, as the debates throughout this Committee stage have shown, it does not generate a lot of excitement. We data protection enthusiasts are a fairly select group, but it is nice to see a few new faces here today.
The Bill runs to 289 pages and is called the Data Protection and Digital Information Bill. Nothing in that name suggests that around 20 pages of it relate, in effect, to giving the Government unlimited access to the bank accounts of large swathes of the population without suspicion of any wrongdoing—20 pages is larger than many Bills. I wonder what the reaction in this Committee and the other place might have been if those 20 pages had been introduced as a stand-alone Bill—called, perhaps, the government right to access bank account information Bill. I suspect that we might have had a few more people in this Room. It feels as if this draconian clause is being hidden in the depths of a Bill that the Government perhaps felt would not generate much interest. It is particularly concerning that it was dropped into the Bill at the last minute in the other place and has not, therefore, received scrutiny there either. This sort of draconian power deserves much more scrutiny than on day 6 in Committee in the Moses Room.
I hope that my desire to stamp out fraud is well known—indeed, I think I can probably describe myself as rather boring on the subject—so I have a lot of sympathy for the Government’s underlying intention here. However, a right to require banks to carry out suspicionless surveillance over the bank accounts of anybody who receives pretty much any kind of benefit, directly or indirectly, is a huge intrusion into privacy and feels completely disproportionate. Others have covered the detail eloquently, so I just want to ask a number of questions of the Minister—I see that we have had a viscount swap at this stage.
I have been trying to work out exactly which accounts could be covered by this requirement. Schedule 11 is not the easiest document to read. It seems clear that if, for example, I am a landlord receiving rent directly from the benefit system on behalf of a tenant, the account of mine that receives the money would be covered, as would any other account in my name. However, would it also catch, for example, a joint account with my wife? I think it would. Would it catch a business account or an account for a charity where I am a signatory, a director or a trustee? I am not sure from reading it, I am afraid. Can the noble Minister clarify that?
Once received, the information provided by the banks may be used
“for the purposes of, or for any purposes connected with, the exercise of departmental functions”.
That seems extremely broad, and I cannot find anything at all setting out for how long the information can be retained. Again, can the Minister clarify that?
As well as being a data protection enthusiast, I am also an impact assessment nerd. I have been trying to work out from the impact assessment that accompanies the Bill—without much success—how much money the Government anticipate recovering as a result of these proposed rights, as well as the cost to the banks, the department and any other parties in carrying out these orders. The impact assessment is rather impenetrable—I cannot find anything in it that covers these costs—so I would be grateful if the Minister could say what they are and on what assumptions those numbers are based.
The noble Lord, Lord Kamall, mentioned unintended consequences. I echo his points: this is really important. Putting additional onerous obligations on banks may make them decide that it is too difficult to provide accounts to those in receipt of benefits. Access to bank accounts for vulnerable people is already an issue, and any incentive to make that worse is a real problem. As the noble Lord pointed out, we have a good example of that with PEPs. All of us have, I suspect, experienced finding it at least difficult to open an account. Some of us have had accounts refused or even closed simply because we have made it difficult for the banks to act for us. The same risk applies to landlords. Why would a landlord want to receive money from housing benefits directly when it will mean that all of his bank accounts and linked accounts will be looked at? He will simply say no. We are therefore reducing the pool of potential accommodation available to housing benefit claimants.
Lord Davies of Brixton (Lab)
Most of what needed to be said has been said excellently and clearly by the other speakers. I have just three specific questions that I urge the Minister to answer. However, an important point of context needs to be made first on the opposition of the finance industry to these proposals. It is clear and unambiguous. It could be thought that the finance industry just does not want to bothered and does not care about fraud, but in fact it is making the point that the Government have failed to come up with an overall fraud strategy. This is just a one-off idea thrown up. Some bright spark thought, “Well, we could put this into the Bill. We’ve always wanted to have this sort of overweening power. Let’s shove it in here and hope no one notices”. We need a proper fraud strategy, as other speakers have said. We lose a lot of money to fraud, so none of us are against appropriate measures to deal with it, but this is a one-off, completely ill-timed and ill-thought-out addition to the state’s powers.
I turn to my three questions. First, I have no doubt that the Minister has a predisposition to oppose the state being able to interfere in our private information—I do not doubt that that is his starting point in these discussions. The problem with this proposal is that there is no way of ring-fencing the information required for the purposes of the DWP from all the other information that is disclosed by looking at someone’s bank account. Their whole life can be laid out in their bank account and other statements. You cannot ring-fence the necessary information. This is a widespread, total intrusion into people’s privacy. Does the Minister accept that there is no way of ring-fencing the information required for the purposes of the DWP from all the other information that is available from looking at someone’s bank account?
Secondly, I have several times heard the Minister discuss improving take-up of pension credit. Does he believe that this will encourage people to claim the pension credit to which they are entitled? It will clearly discourage them. Has this been properly assessed? We know that one big reason why people do not claim pension credit is the state’s intrusion into their private affairs. People do not like it. For some people, seeing an extension of the state’s ability to intrude into their private affairs will discourage them from applying. As I say, the Minister has rhetorically encouraged people to claim their pension credit; in practice, this proposal will discourage people. Does he accept that?
Thirdly, we have three debates on this issue and I think this question may arise more in the next group, but I will ask it now, so that I can come back and ask it again later. People have referred to claimants, but this also covers the state pension. It is possible to defraud the state pension, but it is nevertheless an income. Pension or income—whatever you call it; I do not think we should get too hung up on the vocabulary—it is paid as a right and people are entitled to these benefits.
One of the other theories about our state system is about identical benefits. Some people, like me, who have never been contracted out of the state scheme, have a full state pension, but a lot of people were contracted out into private schemes and personal pensions. Now, because I have that state pension, the state can intrude into my bank account. The state is paying me the pension; it can look at my bank account under these provisions.
However, if my pension were payable by Legal & General Assurance Society or the BP pension fund, they would not have the right to demand access to my bank accounts. I am just pointing out that we would react in horror if this Act gave power to the BP pension fund to trawl through my bank accounts. We would react in horror if we were giving power to Legal & General Assurance Society to go through my bank accounts, yet the Government believe that the state should have this overweening power. Does the Minister accept that and does he think that it is wrong?
Baroness Buscombe (Con)
My Lords, I speak as someone who was a Minister at the Department for Work and Pensions back in 2017. I well remember, when I was in charge of fraud and benefit, when we had a new addition to my team. I felt very strongly about this area because, when I first started as a Minister there, I was incredibly shocked by the level of fraud. Someone talked about having a fraud strategy, but this area is very complex. In the years since then, we have learned that the greatest incidence of fraud is people misstating their assets. Everybody in the Room will know that it is important that you must have only a certain amount of assets to claim benefits, whatever your situation, unless they are not means-tested or are disability benefits.
In 2017, the Treasury ran a controlled pilot. I do not know the details of how it was run, but I saw the results and they were extraordinary. The pilot was at one bank, using the powers they already had, for those who may be avoiding tax—which of course is not a crime—to see whether there was an issue with regard to benefit claimants misstating the extent of their assets when claiming. The extraordinary thing was that they found that between 25,000 and 30,000 at that one bank alone were misstating their assets.
So we know that there is a real problem here, and we know that fraud itself has gone up and up. We are unable to calculate all fraud in the system because, under the legacy system, we found it difficult to check the degree of housing benefit and so on. Maybe it is easier now under universal credit—I hope my noble friend the Minister will be able to tell us that it is—to check people in receipt of benefits who claim to be living alone when they are not.
This is a very nuanced area, but all I can say is that we knew we had a major problem with people misstating their assets. We had to deal with that, but we could not do so without working out how to do so with care, bearing in mind all the issues that noble Lords have raised today about doing it in a proportionate way, in a way that does not conflict with human rights in a way that does not become mass surveillance for everyone. We should bear in mind that since 2011 taxpayers, the people actually funding the benefits system, including some benefit claimants themselves, have had their bank accounts checked to make sure that they are not avoiding tax, which is not a crime—I am talking not about evasion but about avoiding—while fraud in the benefits system is a crime.
We need to be quite careful. Some of the things that have been said today conflating this issue with Horizon are wrong. I have been reading the so-called facts that some of these lobbyists have written about how the clause is disproportionate and unfair and goes too far in terms of people’s privacy. The Department for Work and Pensions works tirelessly to try to do the right thing in the right way. This has not been thrown into the Bill at the last minute as if we have just dreamed it up. That discovery was seven years ago. The noble Lord, Lord Sikka, may laugh, but I do not see the relevance of an awful lot of what he was saying—about the noble Baroness, Lady Mone, and so on—to what we are discussing now.
The reality is that benefit fraud is a serious offence, depriving those who need it most of vital support. A lot of people have come up with cases of very difficult situations that people have to live through. Those are the people we want to support but, frankly, the bill at DWP for this one year is £290 billion. When I was there in 2019, it was £190 billion. We cannot afford to put up with benefit fraud, so we have developed this carefully constructed measure, which needs to be thought through with care. I am sure my noble friend will be able to answer a lot of the questions that have quite rightly been asked today in Committee.
Baroness Lister of Burtersett (Lab)
The noble Baroness mentioned lobby groups that say the clause is disproportionate. The Information Commissioner has questioned the proportionality of this measure. Does she consider the Information Commissioner a lobby group?
Baroness Buscombe (Con)
No. With respect, I am talking about Justice, which I think referenced 40 organisations. There was no list of what those organisations are in the information it sent me. There is also Big Brother Watch and many others.
I just think that everyone needs to take, if I may use the word, a proportionate approach to this. We are talking about tackling a really serious offence. I think all noble Lords agree that we have to tackle fraud but I am sure, and hope, that my noble friend can reassure everybody. The current powers that the DWP has to ensure benefit correctness are mostly over 20 years old. Over that time, fraud has evolved and become increasingly sophisticated. The system currently relies on self-verification for many factors, and that is one of the issues. I know it would sound so much better if people could find another way to check whether someone is being honest about their assets, but the problem is that a lot of this is to do with self-verification.
Lord Davies of Brixton (Lab)
The suggestion was made that this was carefully thought out and part of a long-term plan. Can the noble Baroness therefore explain why it was introduced into the Bill at such a late stage in going through the Commons, such that it did not receive any worthwhile consideration at all there?
Baroness Buscombe (Con)
I am sure my noble friend the Minister can talk about the particular timing of why it went into this Bill. Certainly in my time at DWP, the difficulty we had was finding the right Bill that we could add it to. This is one of the things that is really hard about being a Minister: you cannot just say, “This is something we have to do”. You have to find a route—like finding a route to market—to include a measure in a Bill that is relevant. This Bill is entirely relevant in terms of where we are now on data collection. The Minister and his team were right to choose this particular Bill.
I could go on.
Baroness Buscombe (Con)
I am sorry; I have spent a lot of time listening to others, and a lot of it has been slightly interesting to listen to, I have to say.
The measure will not enable the DWP to access any accounts, and the DWP will not be able to use this measure to check what claimants are spending. The DWP can request information only where there is a link between the DWP, the third party and the benefit claimant or recipient of a payment, and will receive only minimum information on those cases where potential fraud and error are signalled. Once received, the DWP will look at each case individually through its business-as-usual processes and by using existing powers. That work will carefully be undertaken by a human and no automated decisions will be made. That is a really interesting and important point in terms of this measure. I now turn to my noble friend.
Lord Vaux of Harrowden (CB)
I am grateful to the noble Baroness, but could she point out where those restrictions actually are in the Bill? It says that an account information notice can include
“the names of the holders … other specified information relating to the holders … and … such further information in connection with those accounts as may be specified”.
It basically allows the DWP to ask for any information relating to those accounts. I do not see the restrictions that she has just spoken about.
Baroness Buscombe (Con)
It is important that my noble friend answers that question. The point is that if we find—I am sorry, I still speak as if I am involved with it, which I am not, but I promise noble Lords that I have spent so much time in this area. If the DWP finds that there is a link that needs pursuing then that obviously has to be opened up to some degree to find what is going on. Remember, the most important thing about this is that the right people get the right benefits. That is what the Government are trying to achieve.
Lord Clement-Jones (LD)
My Lords, I note that the DWP has been passed a parcel by the Department for Science, Innovation and Technology—and I am not at all surprised. I am sure it will be extremely grateful to have the noble Baroness, Lady Buscombe, riding to its defence today as well. Also, attendance at this debate demonstrates the sheer importance of this clause.
We on these Benches have made no secret that this is a bad Bill—but this is the worst clause in it, and that is saying something. It has caused civil society organisations and disability and welfare charities to rise as one against it, including organisations as disparate as UK Finance, mentioned by the noble Lord, Lord Davies, and the ICO itself. They have gone into print to say that, for this measure to be deemed a necessary and proportionate interference in people’s private lives, to be in accordance with the law and to satisfy relevant data protection requirements, legislative measures must be drafted sufficiently tightly—et cetera. They have issued a number of warnings about this. For a regulator to go into print is extremely unusual.
Of course, we also have Big Brother Watch and the Child Poverty Action Group—I pay tribute to the noble Baroness, Lady Lister—the National Survivor User Network, Disability Rights UK, the Greater Manchester Coalition of Disabled People and the Equality and Human Rights Commission. We have all received a huge number of briefings on this. This demonstrates the strong feelings, and the speeches today have demonstrated the strong feelings on this subject as well.
There have been a number of memorable phrases that noble Lords have used during their speeches. The noble Baroness, Lady Kidron, referred to a “government fishing expedition”. The noble Baroness, Lady Chakrabarti, called it “breathtaking in its scope”. I particularly appreciated the speech of the noble Lord, Lord Kamall, who said, “What happened to innocence?” In answer to the noble Baroness, Lady Buscombe, this is not “nuanced”: this is “Do you require suspicion or do you not?” That seems to me to be the essence of this.
I was in two minds about what the noble Lord, Lord Sikka, said. I absolutely agree with him that we need to attack the fat cats as much as we attack those who are much less advantaged. He said, more or less, “What is sauce for the goose is sauce for the gander”. The trouble is that I do not like the sauce. That was the problem with that particular argument. The noble Baroness, Lady Lister, talked about stigma. I absolutely agree. The noble Lord, Lord Vaux, more or less apologised for using the word “draconian” at Second Reading, but I thought the word “overreach” was extremely appropriate.
We have heard some powerful speeches against Clause 128. It is absolutely clear that it was slipped into the Bill alongside 239 other amendments on Report in the Commons. I apologise to the Committee, but clearly I need to add a number of points as well, simply to put on record what these Benches feel about this particular clause. It would introduce new powers, as we have heard, to force banks to monitor all bank accounts to find welfare recipients and people linked to those payments. We have heard that that potentially includes landlords and anyone who triggers potential fraud indicators, such as frequent travel or savings over a certain amount. We have seen that the impact assessment indicates that the Government’s intention is to “initially”—that is a weasel word—use the power in relation to universal credit, pension credit and employment support allowance. We have also heard that it could be applied to a much wider range of benefits, including pensions. The Government’s stated intent is to use the power in relation to bank accounts in the first instance, but the drafting is not limited to those organisations.
Of course, everyone shares the intent to make sure that fraudulent uses of public money are dealt with, but the point made throughout this debate is that the Government already have power to review the bank statements of welfare fraud suspects. Under current rules, the DWP is able to request bank account holders’ bank transaction details on a case-by-case basis if there are reasonable grounds to suspect fraud. That is the whole point. There are already multiple powers for this purpose, but I will not go through them because they were mentioned by other noble Lords.
This power would obviously amend the Social Security Administration Act to allow the DWP to access the personal data of welfare recipients by requiring the third party served with a notice, such as a bank or building society, to conduct mass monitoring without suspicion of fraudulent activity, as noble Lords have pointed out. Once issued, an account information notice requires the receiver to give the Secretary of State the names of the holders of the accounts. In order to do this, the bank would have to process the data of all bank account holders and run automated surveillance scanning for benefit recipients, as we have heard.
New paragraph 2(1)(b) states that an account information notice requires,
“other specified information relating to the holders of those accounts”,
and new paragraph 2(1)(c) refers to other connected information, “as may be specified”. This vague definition would allow an incredibly broad scope of information to be requested. The point is that the Government already have the power to investigate where there is suspicion of fraud. Indeed, the recently trumpeted prosecution of a number of individuals in respect of fraud amounting to £53.9 million demonstrates that. The headlines are in the Government’s own press release:
“Fraudsters behind £53.9 million benefits scam brought to justice in country’s largest benefit fraud case”.
So what is the DWP doing? It is not saying, “We’ve got the powers. We’ve found this amount of fraud”. No, it is saying, “We need far more power”. Why? There is absolutely no justification for that. No explanation is provided for how these new surveillance powers will be able to differentiate between different kinds of intentional fraud and accidental error.
We have heard about the possibility and probability of automated decision-making being needed here. I do not know what the Minister will say about that, but, if there will not be automated decision-making—that is concerning enough—if the DWP chooses to make these decisions through human intervention the scale of the operation will require a team so large that this will be an incredibly expensive endeavour, defeating the money-saving mandate underpinning this proposed new power, although, as a number of noble Lords have pointed out, we do not know from any impact assessment what the Government expect to gain from this power.
It is wholly inappropriate for the Government to order private banks, building societies and other societies and financial services to conduct mass algorithmic suspicionless surveillance and reporting of their account holders on behalf of the state in pursuit of these policy aims. It would be dangerous for everyone if the Government reversed the presumption of innocence. This level of financial intrusion and monitoring affecting millions of people is highly likely to result in serious mistakes and sets an incredibly dangerous precedent.
This level of auditing and insight into people’s private lives is a frightening level of government overreach, in the words of the noble Lord, Lord Vaux, more so for some of the most marginalised in society. This will allow disproportionate and intrusive surveillance of people in the welfare system. In its impact statement, the DWP says it will ensure that data will be
“transferred, received and stored safely”.
That is in contrast to the department’s track record of data security, particularly considering that it was recently reprimanded by the ICO for data leaks so serious that they were reported to risk the lives of survivors of domestic abuse. With no limitations set around the type of data the DWP can access, the impact could be even more obscure.
We have heard about the legal advice obtained by Big Brother Watch. It is clear that, on the basis that,
“the purpose of the new proposed powers is to carry out monitoring of bank accounts”
and that an account information notice can be issued
“where there are no ‘reasonable grounds’ for believing a particular individual has engaged in benefit fraud or has made any mistake in claiming benefits”,
this clause is defective. It also says that
“financial institutions would need to subject most if not all of their accountholders to algorithmic surveillance”;
that this measure
“will be used not just in relation to detection of fraud but also error”;
and that this measure
“would not be anchored in or constrained by anything like the same legal and regulatory framework”
as the Investigatory Powers Act. It concludes:
“The exercise of the financial surveillance/monitoring powers contained in the DPDIB, as currently envisaged, is likely to breach the Article 8 rights of the holders of bank accounts subject to such monitoring”
in order to comply. It is clear that we should scrap this clause in its entirety.
Baroness Sherlock (Lab)
My Lords, I thank the noble Baroness, Lady Kidron, and my noble friend Lord Sikka for introducing their amendments. I also thank all noble Lords who have spoken. I will speak to Amendments 223, 299, 302 and 303 in my name. I should probably say at this point that I am late to this party but, unlike the noble Lord, Lord Vaux, I am not a data protection specialist, I am afraid. However, I am a social security nerd, so I am here for this bit right now.
Since this is the first part of the Bill on DWP powers to tackle fraud, I need to add my little statement on the “fraud is bad” move. Fraud is a problem and has been getting worse across this Government. There have been scandals in procurement, of which the infamous PPE contracts are just one example. There is tax due that goes unpaid at scale and, in social security, the percentage of benefit expenditure lost to fraud has been rising under this Government. However, as my honourable friends made clear in the Commons, a Labour Government would take fraud seriously and pursue all those who seek to take money fraudulently or illegally from the state. They would also focus on helping people to avoid inadvertent overpayments rather than just waiting for them to make mistakes then coming down hard on them at that point. This should not need saying but, in some of the discussions on this Bill elsewhere, there has been a tendency to frame the debates rather along the lines of a classical fallacy: “Fraud is really bad. This will tackle fraud. Therefore, this must be really good”. I know that we are fortunate that in the Minister we have someone who is able to have a much more nuanced debate. I look forward to having exchanges in a way that recognises the important role of this House in scrutinising the powers that the Executive want to take unto themselves, which is exactly what Committees in the House of Lords do so well.
Scrutiny particularly matters here because, as the noble Lord, Lord Vaux, and my noble friend Lord Davies pointed out, all these amendments—more than 200 amendments, 38 new clauses and two new schedules—were introduced on Report in the Commons. My honourable friend Chris Bryant tried to recommit the Bill so that the Commons could discuss it, but the Government refused. The interesting thing is that in their anti-fraud plan back in May 2022, the Government announced that they planned to boost the DWP’s powers to get information from third parties when parliamentary time allowed. The noble Baroness, Lady Buscombe, made a fair point that departments have to wait for the right Bill to come along in order to use it, but the Government have known about this since 2022. They have had two years to draft the amendments, so although they might have had to wait for the Bill to come along, that does not seem a good enough reason for them to have waited until Report in the Commons to deposit them into the process. I hope the Minister will be able to explain the reasons for that.
My noble friend Lady Chakrabarti and others have asked some important questions about the scale on which these powers will be used; I am going to come back to that in our debate on the next group. It is hard to know the scale from the information we have so far, but DWP clearly does know, or has a sense of it, because paragraph 85 of the impact assessment states:
“Using our model to estimate volumes of hits for this measure, over the 10-year appraisal period, internal analysis has estimated that in total there will be an additional 74,000 prosecution cases, 2,500 custodial sentences and 23,000 applications for legal aid”.
It has modelled the volume of matching hits that would require investigation. Can the Minister tell the Committee what that number is? Also, what assurance can he give us that DWP has the resources to investigate that number of hits in a timely manner?
Paragraph 2 of new Schedule 3B says that the account information notices can only cover data going back a year and that they must be done in the week before they are given to DWP. Is there any time limit on how long DWP has to act on the results that have been handed over to it?
I turn now to the amendments in my name. Some of them are quite detailed because these powers are astonishingly wide and it is not at all clear how they could be used. I have deliberately tabled a series of amendments—in three groups in order to make sure that we have a chance to go into detail—to try to get information out of the Government and find out what this is about.
Amendment 223 is a minor probing amendment that would delete paragraph 3(1) of new Schedule 3B, which Schedule 11 to the Bill would insert into the 1992 Act. I will not rehearse it here but can the Minister explain what that provision is for and what its limits are? Neither I nor the people I have spoken to in financial services can understand why it is needed.
The noble Baroness, Lady Kidron, and others mentioned the fact that the Information Commissioner said he could not provide to Parliament his assurance that this measure is proportionate. My other amendments in this group are therefore designed to try to understand the impacts better. Amendment 302 would prevent these new powers coming into force automatically, while Amendment 303 would require the Secretary of State to fulfil several requirements before laying regulations to commence the powers. Amendment 299 is a minor consequential amendment. The effect of this is that the Secretary of State would have to issue a call for evidence, to inform the creation of the first code of practice, and consult relevant bodies. They would also have to lay before Parliament statements on key issues, of which I will highlight two.
The first would say whether and how AI will be used in exercising these powers, as well as how those proposals will take account of protected characteristics; this was touched on by my noble friend Lady Lister and others. That benefits often engage protected characteristics is in the nature of social security. Sickness and disability benefits engage disability, obviously; pensions engage age; benefits relating to children may engage age and also indirectly engage sex; and so on. The National Audit Office has warned that machine learning risks bias towards certain vulnerable groups and people with protected characteristics. So, what external governance or oversight is there to ensure that, once data are collected on the scale envisaged here, we do not end up with a mass breach of equality law?
The second issue I want to highlight concerns the provision that will be made to ensure that individuals subject to investigation do not experience hardship during it or lasting detriment afterwards. Given the comments of my noble friend Lady Lister about the cases from CPAG, can the Minister say whether a claimant’s benefits will be kept in payment while they are investigated following the data that are surfaced as a result of these trawls?
I am concerned that, given the potential scale of hits, a claimant who had, say, inadvertently breached the capital limit but then found themselves at the back of a long queue to be investigated could find themselves ending up paying back really large sums. The Minister will be aware of the recent media coverage, which others have mentioned, of how the DWP is treating people who were overpaid the carer’s allowance, a benefit that gives £81.90 a week to people providing at least 35 hours a week of unpaid care. It is a cliff-edge benefit—if your net earnings are under £150 a week, you get the lot; if they are over it, you get nothing—so a small rise in the minimum wage or a change in tax thresholds or rates can be enough to make someone entirely ineligible overnight, even if nothing changes in their circumstances.
As my noble friend Lady Lister said, apparently, DWP’s IT systems can flag when a carer’s income breaches the threshold but it does not necessarily do that, allowing them then to rack up potentially thousands of pounds’ worth of overpayments. The Guardian has investigated this issue; I shall mention two cases that it offered. First, an unpaid carer with a part-time charity job unknowingly breached the threshold by an average of £4.40 a week—£58 in total—caused by the automatic uprating of the national minimum wage. Because that left her not eligible for anything, she ended up being told to repay £1,715, including a civil penalty.
In the second example, a woman caring for her husband with dementia and Parkinson’s was told to repay nearly £4,000 for inadvertently exceeding the earnings threshold by calculating earnings from her zero-hours job on a monthly basis, as she thought the rules required, rather than a four-weekly basis, which they actually do; the rules around allowable costs and earnings are quite complicated. Crucially, according to the Guardian, she was told that, if she appealed, it could cost her even more. The Guardian quotes from a DWP letter telling her that, if she challenged the repayment order,
“the entire claim from the date it started will be looked at, which could potentially result in the overpayment increasing”.
Is that standard practice? Is DWP currently acting on all the alerts it receives of overpayments? If these powers are switched on, what safeguards will there be when that happens to protect millions of people from ending up paying back years of overpayments that DWP could have prevented?
Before embarking on investigations on this scale, we need to understand more about how this measure will work. We have had some excellent questions in Committee from the noble Lord, Lord Vaux, and others; I look forward to the Minister’s reply.
The Parliamentary Under-Secretary of State, Department for Work and Pensions (Viscount Younger of Leckie) (Con)
My Lords, I thank all those who have spoken today. I have been made well aware of the strong views expressed about this measure in Committee. I thank the noble Baroness, Lady Sherlock, for her kind remarks. She is right: I take all these matters extremely seriously. I have listened carefully to all the speeches, although I might not agree with them. Many questions have been asked. I will attempt to cover them all, of course; I doubt that I will be able to but I assure noble Lords that it is likely that a long letter will be required after this. Obviously, I will reflect on all the speeches made in Committee today.
I start by talking about the timing of the introduction of this measure. The noble Baroness, Lady Sherlock, said that the measure was introduced, in her words, “on the late side”. As she alluded to, the DWP published the Fraud Plan in May 2022, where it outlined a number of new powers that it would seek to secure when parliamentary time allowed. In answer to her question and others, in the parliamentary time available, the DWP has prioritised our key third-party data-gathering measure, which will help it tackle one of the largest causes of fraud and error in the welfare system. We will not sit back and ignore an opportunity to bring down these unacceptable losses and better protect taxpayers’ money. I will expand on all of that later in my remarks.
Before attending to the themes raised and addressing the amendments, it is important to set out the context for the power for which we are legislating. Fraud is a serious and damaging UK-wide issue, accounting for more than 40% of all crime. To be fair, many speeches alluded to that. The welfare system is also a target for fraudsters, and we are seeing increasingly sophisticated attacks occur on a scale that we have not seen in the past. We all have our own experiences at home of fraudsters who try completely different methods, not linked to the benefits system at all, to try to gain money through ill-gotten uses and methods.
In 2022-23, the DWP paid out more than £230 billion in benefits and payments to people across Great Britain. I very much took note of the figure that my noble friend Lady Buscombe raised. I say to the Committee that this figure is forecast to rise to nearly £300 billion by 2024-25, in quite short order, so this is a really serious issue to address. However, more than £8 billion has been overpaid in each of the past three years because of deliberate fraud against the state or because genuine errors have been made.
To assist the noble Baroness, Lady Lister, to whose speech I listened carefully, fraud, not error, is the biggest cause of welfare overpayments, totalling £6.4 billion of the £8.3 billion overpaid last year. The noble Lord, Lord Vaux, also asked about the figures. These losses are largely because people are intentionally and knowingly taking money that they are not entitled to. This is not organised fraud either; the vast majority comes from individuals who are not entitled to the money. We cannot underestimate the lengths to which some will go in order to take money they are not entitled to or promote ways to defraud us to a wider audience. This new legislation is not just about protecting the taxpayer; it will help those who make genuine mistakes in their claim, and our swift action will avoid them building up large overpayments.
Some people have said that the department has the powers that it needs to fight fraud and error—I think that was alluded to even today. However, some of the current powers that we have to ensure benefit correctness are over 20 years old—a point that I think my noble friend Lady Buscombe made. In this time, fraud has evolved and become increasingly sophisticated and we must keep pace with the fraudsters. It is for this reason that the Government are bringing these new third-party data powers, as set out, as said earlier, in the fraud plan.
Lord Vaux of Harrowden (CB)
I apologise for interrupting, but can the Minister show us in the Bill where those restrictions on the information that can be requested reside? As I read it, as I mentioned to the noble Baroness, Lady Buscombe, paragraph 2(1) of new Schedule 3B, as inserted by Schedule 11 of the Bill, is pretty wide when it refers to
“names of holders … other specified information relating to the holders … and … such further information in connection with those accounts as may be specified”.
So it appears that the DWP can ask for whatever it wants, rather than what the Minister just described.
Viscount Younger of Leckie (Con)
That is a fair challenge and I will certainly be coming on to that. I have in my speech some remarks and a much more limited reassurance for the noble Lord.
It is only when there is a signal of potential fraud or error that the DWP may undertake a further review, using our business-as-usual processes and existing powers—an important point. DWP will not share any personal information with third parties under this power, and only very limited data on accounts that indicate a potential risk of fraud or error will be shared with DWP in order to identify a claimant on our system. As I said earlier, I will say more about the limited aspects of this later in my remarks.
Lord Clement-Jones (LD)
I am sorry to interrupt the Minister, but will he be coming on to explain what these signals are? He is almost coming to a mid-point between innocence and suspicion called “signals”—is this a new concept in law? What are we talking about and where in all of Schedule 11 is the word “signal”?
Viscount Younger of Leckie (Con)
If the noble Lord will allow me, I would like to make some progress and I hope that this will come out in terms of what we may be seeking on a limited basis.
The first third parties that we will designate will be banks and other financial institutions, as the Committee is aware. We know that they hold existing data that will help to independently verify key eligibility factors for benefits.
This clause does not give DWP access to any bank accounts—a very important point—nor will it allow DWP to monitor how people spend their money or to receive sensitive information, such as medical records or data on opinions or beliefs.
As the noble Baroness, Lady Sherlock, mentioned—I want to try to answer one of her questions—this power cannot be used to suspend someone’s benefit. Cases that are flagged must be reviewed under existing processes and powers—business as usual, which I mentioned earlier—to determine whether incorrect payments are being made.
Our approach is not new. HMRC has long been using powers to request data at scale from banks on all taxpayers under Schedule 23 to the Finance Act 2011. Our approach carries similar safeguards. Tax fraud is no different from welfare fraud and should be treated similarly. This was a key point that the Prime Minister made only on Friday when he committed to bring DWP’s fraud and error powers more in line with those of HMRC. This is one clear area where we are seeking to do this.
This allows me to go on to very important points about safeguards. Not all the cases found through this power will be fraud. Some will be errors which the power will help to correct, preventing overpayment debt building up. Some cases may also have legitimate reasons for seemingly not meeting eligibility requirements, for example where claimants have certain compensation payments that are disregarded for benefit eligibility rules. In those cases, no further action will be taken. Our robust business-as-usual processes will ensure that all cases are dealt with appropriately.
Another question raised by the noble Lord, Lord Vaux, on safeguards was to do with the legislation. A key safeguard is that we cannot approach any third party either; there must be a three-way relationship with the department, the claimant and the third party. This safeguard will narrow the use of this power substantially and ensure that it is used proportionately, as these three-way relationships are limited, meaning that data cannot be gathered at scale from just any source for any purpose. Any third party we will want to get data from will need to be designated in affirmative regulations that noble Lords will have an opportunity to scrutinise. These regulations will be accompanied by a code of practice. We will be bringing that forward, and we will consult on the code before presenting it to Parliament—which answers a question raised by, I think, the noble Baroness, Lady Kidron.
The power also ensures that we can request only very limited data on benefit recipients. I think this addresses a point raised by the noble Lord, Lord Vaux. We must work with key third parties to define what is shared, but our expectation is that this would be a name and date of birth or a unique payment number, along with the eligibility criteria someone has matched against: for example, a benefit claimant who has more savings than the benefit rules would normally allow.
Outside controls will apply here, too. DWP already handles vast amounts of data, including personal data, and must adhere to the UK GDPR and the Data Protection Act 2018.
On the point, which again was raised during this debate, about the remarks made by the Information Commissioner’s Office and its updated report on this measure, published as Committee started and which the Committee may be aware of, I was pleased to see that the commissioner now acknowledges that the third-party data measure is in pursuit of a legitimate aim, stating:
“I understand and recognise the scale of the problem with benefit fraud and error that government is seeking to address and accept that the measure is in pursuit of a legitimate aim. I am not aware of any alternative, less intrusive, means of achieving the government’s stated policy intent based on their analysis”.
I think that is a significant point to make, and it is a point with which I very strongly agree.
Lord Clement-Jones (LD)
It is also worth pointing out that the paragraph I quoted follows immediately on that. That is the qualification that I quoted.
Viscount Younger of Leckie (Con)
Yes, I am aware of that. I think the noble Lord was alluding to the point about proportionality. I listened carefully and took note of that, but do not entirely agree with it. I hope that I can provide further reassurances, if not now then in the coming days and weeks. The point is that there is no other reasonable way to independently verify claimants’ eligibility for the payment that they are receiving.
I turn to the amendments raised, starting with the stand part notice from the noble Baronesses, Lady Kidron and Lady Chakrabarti, the noble Lord, Lord Anderson of Ipswich, who is not in his place, and the noble Lord, Lord Clement-Jones. They and my noble friend Lord Kamall, who is not in his place, interestingly, all made their case for removing the clause, of which I am well aware. However, for the reasons that I just set out, this clause should stand part of the Bill.
In raising her questions, the noble Baroness, Lady Kidron, made some comparisons with HMRC. There are appropriate safeguards in place for this data-gathering power, which will be included in the code of practice. The safeguards for this measure will be equivalent to those in place for the similar HMRC power which Parliament approved in the Finance Act 2011.
Lord Vaux of Harrowden (CB)
When might we see the code of practice? It would be extremely helpful to see it before Report, as that might short-cut some of these discussions.
Viscount Younger of Leckie (Con)
I will need to get back to the noble Lord on that, but perhaps can reassure him that it is already being worked on. You can imagine that, because of the sensitivity of these powers, we are working very carefully on this and making sure that it will be fit for purpose.
Lord Bassam of Brighton (Lab)
Can we see the draft code of practice before Report?
Viscount Younger of Leckie (Con)
That is part of the answer that I gave to the noble Lord, Lord Vaux, which I think is a fair point.
The noble Baroness, Lady Kidron, asked about the code of practice and what steps my department will take to ensure transparency and accountability in the exercise of these powers if they are implemented. In the primary legislation, we will make provision to publish the code of practice, which will set out general guidance on how the third-party data power will work, as I have mentioned. We will develop the code of practice with relevant third parties and it will be consulted on publicly before being laid in Parliament. We will explain what the expectation is for data holders and ensure full compliance for the DWP. This will provide assurance that we will operate transparently and mirror the approach that we have taken with other DWP powers. Any changes to the code of practice, other than minor changes, will also be done in consultation with stakeholders.
The noble Baroness, Lady Kidron, stated that the power was too broad and the gist of one of her questions was that there is no need for all these benefits to be in scope. As the noble Baroness has demonstrated, there is a wide range of benefits and therefore potential avenues for fraudsters to seek to exploit or for error to creep in. That is why it is important that the power enables the department to respond proactively, as new fraud risks emerge.
That said, as the noble Baroness knows, the power will not be exercisable in all the benefits that she listed, such as child benefit, because the legislation is drafted in such a way that it could reasonably be exercised only in relation to benefits for which the Secretary of State is responsible. I reassure the Committee that using Section 121DA of the Social Security Administration Act 1992 is a consistent approach that we take to defining benefits in this way to safeguard all existing legislation and account for a benefit being, for example, renamed or amended. It should be stressed that the listing of a benefit does not mean that this power can or will be exercised upon it. The conditions in the third-party data legislation must still apply, and therefore not all benefits will be subject to this measure. That is a very important point.
Lord Sikka (Lab)
I would be convinced about the Government’s intentions, and would not press this amendment at the next stage, if the Minister can name just one big accounting firm which since 2010, as a result of a court judgment that said it was selling unlawful tax avoidance schemes, has been investigated, fined or prosecuted. If he can give me such an example then I will be convinced that the Government are seriously tackling tax fraud and its enablers.
Viscount Younger of Leckie (Con)
The noble Lord has set me quite a challenge at the Dispatch Box. It is out of scope of today’s session but, having said that, I will reflect on his question afterwards.
I am aware that time is marching on. My noble friend Lord Kamall asked about burdens on banks. We believe that the burdens on banks will be relatively low.
The noble Baroness, Lady Sherlock, made a number of points; I may have to write to her to expand on what I am about to say. Removing the requirement for third parties to provide legible copies of information means that DWP could receive the information but there is a risk that the information is not usable; that is my answer to her points. This could limit the data that DWP receives and prevent us utilising the power in full, which could in turn impact the savings due to be realised from this important measure.
I turn to the final amendments in this group, which were raised by the noble Baroness. They would place requirements on the Secretary of State to issue statements in the House and consult on the code of practice. We will talk more about the code of practice later on in this debate, and I have already made clear my firm opinions on it: we will take it forward and are already working on it. There will be a consultation that will, of course, allow anybody with an interest in this to give their views.
I turn to the number of statements that must be made in the House regarding the practical use of the measures before powers can commence, such as the role that artificial intelligence will play or assurances on any outsourcing of subsequent investigations. This is an important point to make and was raised by other Peers. I want to make it clear that this measure will be rolled out carefully and slowly through a “test and learn” approach from 2025, in conjunction with key third parties. To make these statements in the House would pre-empt the crucial “test and learn” period. I say again that discussions with the third parties are deep and detailed and we are already making progress; this point was made by the noble Lord, Lord Clement-Jones, on the link with banks and third parties.
Importantly, I assure the noble Baroness, Lady Sherlock, that we will not make any automated decisions off the back of this power; this was also raised by the noble Baroness, Lady Kidron. The final decision must and will always involve a human being—a human agent in these cases—and any signals of potential fraud or error will be looked at comprehensively. I am grateful for the remarks of my noble friend Lady Buscombe on this matter.
I know that I have not answered a number of questions. Perhaps I can do so in our debate on another group; otherwise, I certainly wish to answer them fully in a letter. I hope that I have explained clearly, from our perspective, why this power is so important; why it is the right power to take; and how we have carefully designed it, and continue to design it, with the key safeguards in mind. I strongly value the input from all those who have contributed today but I remain unconvinced that the proposed amendments are necessary and strengthen the power beyond the clear safeguards I have set out. With that, I hope that the noble Baroness will not press her opposition to Clause 128.
Lord Clement-Jones (LD)
I may have missed something, but can I just check that the Minister will deal with the matter of signals, which he mentioned at the beginning of his response? Will he deal with where that phrase comes from, what they are, whether they will be in the code, et cetera? There are a lot of questions around that. Does it amount to actual suspicion?
Viscount Younger of Leckie (Con)
Absolutely; I am keen to make sure that I answer on that. It may be possible to do so in the next group but, if not, I will certainly do so in the form of a precise letter—added to the larger letter that I suspect is coming the noble Lord’s way.
Lord Sikka (Lab)
A number of pensioner groups are watching these proceedings. I have received some messages. They are asking, “When is the Minister going to answer the questions asked about the operation of the surveillance of recipients of the state pension, especially those who have foreign accounts?” I assume that the Minister will clarify that in any subsequent letter to me.
Viscount Younger of Leckie (Con)
Absolutely; the noble Lord will know that I have not managed to answer all the questions. I have tried to bring in everybody on this important and serious debate. The answers will be forthcoming.
Baroness Buscombe (Con)
I thank my noble friend very much for all the explanation that he has given thus far. I just want to add a word that has not been mentioned: deterrent. One of the reasons why the Government have sought to introduce this in the Bill, I believe, is that it is hugely important that we are much more thoughtful about what will stop people doing the wrong thing. It has become an old-fashioned word but, from a legal, practical and moral standpoint, does my noble friend agree that this is a practical deterrent to make sure that people do the right thing?
Baroness Lister of Burtersett (Lab)
Is it not one of the dangers that this is a deterrent to people claiming these benefits?
Viscount Younger of Leckie (Con)
I have a response to the question from the noble Lord, Lord Clement-Jones, about signals. The signal is where the criteria or rules for benefit eligibility appear not to be met, and Parliament will have agreed those rules.
Baroness Kidron (CB)
My Lords, the Committee will be grateful to hear, I hope, that I will not try to capture such a rich conversation. I thank the Minister for his careful listening and consideration. I will read carefully what was said at the Dispatch Box and what is about to be said during our discussion on the next two groupings because, without seeing all that in the round, I cannot truthfully say whether the questions asked by noble Lords have been answered.
I share a little of the concern that I can see agitating the noble Lord, Lord Clement-Jones, about the words “signals”, “criteria” and “codes”, which are not promised in the Bill but are suddenly appearing. Indeed, the Minister will remember that, in a private meeting, we talked about how those criteria might be gamed and, therefore, how detailed they could possibly be. There may still be some differences of opinion, and possibly differences of practice, that need to be worked out.
Of course, for now, I will not press my opposition to Clause 128 standing part. I welcome further conversation between now and Report but, I have to say, I lost count of the number of times noble Lords have said “proportionate” in this debate and how many times the issues of scope, sweeping powers and so on were stated by some very expert people—both in and outside of this Room, not simply noble Lords.
The noble Baroness, Lady Buscombe, mentioned a pilot but I seem to remember that some of the outcomes on equality in that pilot got lost in translation. Perhaps it would be good to find out exactly what the pilot did and did not reveal—that is, not just the things that the department would like to reveal but some of the things that were not tested.
I do not doubt the personal integrity of the Minister in the slightest but I am unsure about the idea that the “test and learn” approach has no boundaries around it in the Bill. It is like saying, “Trust us. We test and learn, and all those powers exist”. With that, I will withdraw my stand part notice on Clause 128, but we have quite a lot of questions still to answer in our discussions on the next group of amendments and beyond.
Baroness Sherlock
Member's explanatory statement
This amendment, alongside others to paragraph 1 of Schedule 11 in the name of Baroness Sherlock, would reframe the Secretary of State’s power to give account information notices, making clear that the power should only be used in cases where there is suspicion that benefits are not being paid in accordance with enactments and rules of law relating to those benefits.
Baroness Sherlock (Lab)
My Lords, I will also speak to the other amendments in my name, which are designed to dig further into exactly what the Government plan to do with these powers. Amendments 220 to 222 are probing amendments which seek to establish what would happen if the powers to give account information notices were used only where there is suspicion that benefits are not being paid as the law intends. I will try to use this to find out exactly what will happen with the signal that the noble Lord, Lord Clement-Jones, has been referring to.
Baroness Lister of Burtersett (Lab)
My Lords, I intervene very briefly. I thank my noble friend who, with her usual forensic clarity, identified some really important points. The last one in particular is very worrying. I have a question. It may be that I misheard what the Minister said in response to the last set of amendments. I thought I heard him say that child benefit would not be included, but it appears to have been on the list that was given to my noble friend. Of course, the point is partly that it is administered by HMRC, but it has replaced child tax allowances, so it should be treated in the same way as a tax allowance when it comes to this purpose—so I hope that I heard the Minister correctly and that child benefit will not be included.
Baroness Kidron (CB)
My Lords, in relation to the excellent speech of the noble Baroness, she mentioned “personal” accounts. I would like to double-check that business accounts, charitable accounts and other accounts that have one’s name or one’s partner’s name on, or are connected, do not go on ad infinitum.
Lord Davies of Brixton (Lab)
Because of the way the amendments are grouped, I have the opportunity to repeat my questions. The first one is relatively straightforward. Does the Minister accept that introducing these provisions—obviously we are talking about Amendment 234 on pensions—will discourage people from claiming pension credit? Despite all the efforts of the Government to encourage people to claim pension credit, clearly this will discourage them. Have the Government made any effort to estimate what impact this will have? Obviously, it is a very difficult task, but have they thought about it and does the Minister accept that it will have a deterrent effect.
My second question relates to the issue I have already raised. The state pension or state pension equivalent is paid by the state, by a pension fund or by a personal pension provider. Does the Minister think it odd that there is a difference in treatment? Everyone is receiving their pension from the state, but with a person who receives their pension from a private pension scheme or personal pension provider there is not the same right to look at their bank accounts in relation to those benefits. Now I am not advocating that as a solution. The question is: does this not indicate the illogicality and extent of the Government’s powers over some people’s incomes that they do not have over other types of income? To me, particularly when it comes to the payment of a pension—a benefit paid as of right—this discontinuity points to the extent of the Government’s overreach.
Baroness Bennett of Manor Castle (GP)
My Lords, I must begin by joining the general applause for the characteristic tour de force from the noble Baroness, Lady Sherlock. I was having a flashback because it was the noble Baroness in debate on what is now the Pension Schemes Act 2021 who taught me how to cope with Committee stage very kindly a long time ago —and we are very used to that. I rise briefly to address this group, but I start by saying in relation to the last group that I entirely agree with the proposition that Clause 128 should not stand part: the spying clause should not be part of the Bill.
I have a couple of points to make on the amendments in this group, one of which was raised by the noble Lord, Lord Clement-Jones, on the last group and is about protecting the Government from themselves. The amendments put down by the noble Baroness, Lady Sherlock, are probing. However, if we were to restrict the Government’s use of these powers, they might end up at a vaguely manageable scale. It is worth raising that point when we look at these groups.
Lord Vaux of Harrowden (CB)
My Lords, I was not intending to speak on this group, but another question occurs to me. We have been assuming throughout this that we are talking about requests of information to banks, but the Bill actually says that:
“The Secretary of State may give an account information notice to a person of a prescribed description”.
Could the Minister explain what that is?
Lord Clement-Jones (LD)
My Lords, I would of course much prefer Clause 128 not to stand part, but we were just privileged by a master class from the noble Baroness, Lady Sherlock. She talked about these being probing amendments, but I do not think that I have seen a schedule so expertly sliced and diced before. If those are probing, they are pretty lethal. I agree with so many of those elements. If we are to have provisions, those are the kinds of additions that we would want and the questions that we would want to ask about them. I very much hope that the Minister has lots of answers, especially for the noble Baroness, Lady Sherlock, but also for the other noble lords who have spoken.
Viscount Younger of Leckie (Con)
My Lords, the debate on this group has focused largely on the amendments from the noble Baroness, Lady Sherlock, regarding using powers only where there is a suspicion of fraud, making provisions so that information collected can be used only for the narrow purpose of determining overpayment, removing pension-age benefits from the scope of the powers and requiring approval from Parliament before the power can be used on specific working-age benefits.
I was going to go over the reason behind these measures once again, but I will not delay the Committee on why we are bringing them forward. I believe I did that at some length in the previous group, so I am going to turn to the amendments raised.
Narrowing these powers as suggested by the noble Baroness, with Amendments 220, 221, 222 and 222A, will leave us exposed to those who are deliberately aiming to defraud the welfare system and undermine the policy intent of this measure. In fact, taken together, these amendments would render the power unworkable and ineffective.
To restrict the power to cases where DWP already has a suspicion of fraud, as suggested by the noble Baroness, would defeat the purpose of this measure. The intent is to enable us to use data from third parties to independently check that benefit eligibility rules are being complied with. We use data from other sources to do this already. For example, we use data from HMRC to verify earnings in UC and check that the benefit eligibility rules are being complied with. Parliament has determined that, to be eligible for a benefit, certain rules and requirements must be met, and the Government have a responsibility to ensure that taxpayers’ money is spent responsibly. Therefore, the DWP should be able to utilise information from third parties to discharge that duty. This is an appropriate and proportionate response to a significant fraud and error challenge.
The noble Baroness, Lady Sherlock, also proposed that the power should be restricted such that it would not apply to persons who hold an account into which a benefit is paid on behalf of someone who cannot manage their own financial affairs—such persons are referred to as “appointees”. An appointee is a person who may be appointed by the Secretary of State to act on behalf of the benefit customer. Usually, the appointee becomes legally responsible for acting on the customer’s behalf in all matters related to the claim. It is also made clear to the appointee, in the documents that they sign, that we may get information about them or the person they are acting for from other parties, or for any other purposes that the law allows, to check the information they provide.
Under our proposed legislation, it is right to say that there may be some people who are not themselves benefit claimants but who have given a person permission to pay benefits into their bank account, who may be picked up in the data returned by third parties. Under the noble Baroness’s amendment, we would not be able to gather data on appointees, which would make the power unworkable, because third parties would not be able to distinguish between an individual managing their own benefit and an appointee. It also assumes that no fraud or error can occur in these cases, which is definitely wrong. I assure the noble Baroness that we handle such cases regularly and have robust existing processes for identifying appointees on our own database and for carefully handling cases of this nature.
The noble Baroness would also like to see the power—
Baroness Sherlock (Lab)
Rather than asking all my questions at the end—I only have four—I will try to get answers as we go. On the appointees, I think that the Minister has just said that the reason the Government need these powers is that some appointees will have their benefit money paid into their own account, not into a separate second account, so that therefore needs to be the case. I am very happy to reword this amendment to make that clear. I was talking specifically about the linking arrangements; the amendment does not talk about excluding appointee accounts. It specifically says that accounts that are linked to an account into which the benefit is paid are not there. I am happy to reframe that in a way that defines it—I am sure we can find a way around this—but does the Minister accept the principle behind this: that, if there is a separate account that, say, I hold for a child who is there, this should not give a reason to look into my own accounts? Or is he saying that the Government want to look into my own accounts, or business accounts, or family accounts as well? Which is it?
Viscount Younger of Leckie (Con)
The Government do wish to have that power. I should make it clear that an appointee could be a claimant as well, so there is a dual issue. It is important that we retain that power, to be sure that we cover the whole ground. But I will reflect on the noble Baroness’s point.
Baroness Kidron (CB)
There were a number of questions on the other group that related specifically to people’s willingness to take these roles on and what the unintended consequence of putting appointees and carers in this position might be for the DWP, with people saying, “Actually, not me, then”.
Viscount Younger of Leckie (Con)
The noble Baroness makes a very good point. I may be able to give her further reassurances in a letter because, on the one hand, we do want the power to be able to cover the ground. On the other hand, there are necessary protections that we must put in place. So further reassurances probably need to be given. There is that balance to be struck, but I hope I can continue to do that.
Baroness Jones of Whitchurch (Lab)
If I may pursue this, I am not sure I heard the Minister’s answer to the question of the noble Baroness, Lady Kidron—or maybe I did. If it was a charitable bank account, a business account or anything else, I think the Minister said that it would be subject to that scrutiny as well. Once someone acts for a carer, all of their bank accounts could be scrutinised—surely that is ridiculously unfair.
Viscount Younger of Leckie (Con)
I am not sure I agree with that. I hope I can reassure the noble Baroness, as I tried to on the previous group. Using our test and learn process, which is already under way working closely with the banks, bringing them along with us and them bringing us along with them—there is a good relationship there—we are working through these important matters.
The point made by the noble Baroness, Lady Kidron, is important, as is that of the noble Baroness, Lady Jones. Again, it is important to give those reassurances. They will be forthcoming, and that is all part of our test and learn process, which I hope provides some reassurance.
Lord Vaux of Harrowden (CB)
I want to be absolutely clear on this point, because I am still not totally sure I am—I raised this the first time around on the last group. If I, as a landlord, have been paid rent as housing benefit directly, my accounts are caught. If I am a trustee of a charity and a cosignatory on a bank account, is the Minister saying that that charity’s account will be caught or not? I want to be absolutely crystal clear on that.
Viscount Younger of Leckie (Con)
This is part of the filtering discussions that are already taking place at the moment.
Lord Vaux of Harrowden (CB)
Under the terms of the Bill, would this allow that to be caught?
Viscount Younger of Leckie (Con)
Yes it would. Landlords are in scope. We will filter this through in terms of the business as usual. If we receive any information—
Baroness Lister of Burtersett (Lab)
Given that, has the department done an assessment of the likely impact on landlords being willing to take people on housing benefit? It is already an issue that landlords are reluctant to take housing benefit recipients, but, with this, I could see the market completely freezing for people on benefit.
Viscount Younger of Leckie (Con)
I clearly cannot go far enough today, but, because this is important and we are in Committee, I need to give some further reassurances on where we are in the process in terms of filtering. If I may conclude my remarks, I will finish this particular point. This is all part of the test and learn, and I give some reassurance that we are working through these important issues in relation to appointees and landlords.
Lord Clement-Jones (LD)
It is precisely as the noble Baroness, Lady Kidron, said on the last group—this is a massive net. It feels as though this is so experimental that there is no certainty about how it will operate, and the powers are so broad that anything could be subject to it. It sounds extremely dangerous, and it is no wonder that everybody is so concerned.
Viscount Younger of Leckie (Con)
I do not agree with that. We have done quite a lot of business together across the Chamber. That is a slightly sweeping issue, because I have given some reassurance that we are already working with the third parties to make sure that we have robust processes in place. For instance, when we are talking about landlords, while it is possible that a landlord’s account may be matched under the measure, only minimum information will be provided by the third parties to enable my department to identify an individual within our own database. With all the data received, we will make further inquiries only where appropriate and where the information is relevant to the benefit claim. This is already part of our business-as-usual processes.
Lord Clement-Jones (LD)
My Lords, I am sorry to interrupt the Minister but, throughout these two groups, he has, in a sense, introduced wholly new concepts. We have “test and learn”, “filtering”—which sounds extraordinary—and “signals” but none seem to be in the black letter of the schedule, nor in the rest of the Bill. We have a set of intentions and we are meant to trust what the DWP is doing with these powers. Does the Minister not recognise that the Committee is clearly concerned about this? It needs tying down, whether we need to start from scratch and get rid of the clause or take on board the amendments put forward by the noble Baroness, Lady Sherlock. The uncertainty around this is massive.
Lord Sikka (Lab)
My Lords, I ask the Minister for clarification. The noble Baroness, Lady Sherlock, asked about the number of individuals; I guess it may be 24 million or 25 million. However, from what the Minister has said, the number of bank accounts subject to surveillance would be far greater than that. For example, I receive a state pension and am also a trustee of a small not-for-profit organisation; from what the Minister said, I would be caught, as would that organisation. Landlords and many others could possibly be added. It seems that the number of bank accounts would be far greater than the number of individuals. When he provides the data, can the Minister estimate how many bank accounts and transactions there might be?
Baroness Bennett of Manor Castle (GP)
I will add to that the issue of overseas bank accounts. I cannot see how the British Government can apply this measure to them. Will this not push people to go to overseas bank accounts? Or will the Government try to pursue them through challenger banks—including multiple accounts from one person who may have one original, normal current account here?
Baroness Kidron (CB)
How many accounts of “signalling” already exist in the current backlog in the business-as-usual version? What kind of investment will it take when you supercharge these powers and get many more tens of thousands of signals?
Lord Vaux of Harrowden (CB)
I will add to the Minister’s grief. He has talked a number of times about the limited information that will be provided to the DWP, but that is not what the Bill says. The Bill refers to
“such further information in connection with those accounts as may be specified”.
There is no limitation in the Bill to the information that the DWP can request from the bank—assuming that it is a bank, after my previous question. I am struggling to understand how we get from that to “limited”.
Viscount Younger of Leckie (Con)
Right. A number of questions have been asked. I am not sure that I can give too much more clarity—only that I will go back to what I said on the first group in terms of the limited nature of what we are trying to do. I was very clear about its limited nature, I think.
This leads on to the numbers that noble Lords are asking me about. Of course, I cannot give that figure, as we do not honestly know it. Until we move forward on bringing the measure in, we will not know it. What is certain is that we need this power to be able to gain the limited data that we need. When we receive the data, it may be the case that we need to follow up. I am sure that we will not need to follow up in the vast majority of cases but we must have this power.
To the noble Lord, Lord Vaux, I say this: this measure is for UK accounts only. I hope that that is also helpful to the noble Baroness, Lady Bennett.
Lord Vaux of Harrowden (CB)
This is the problem. We have been talking about limited information, a limited nature and the limited things that we will look at, but that is not what the Bill says. We need to think seriously about how we should limit the rights in the Bill to match the requirements of the DWP. At the moment, there seems to be a huge gap.
Viscount Younger of Leckie (Con)
That point is very much noted. I will certainly take it back. Clearly, we need to provide greater reassurance on the limits and scope, as well as on what we are trying to do. I regret that I am not able to give those answers in full to the Committee now but I hope that, today, I have already taken us further forward than we were before we started. That is quite an important point to make.
I shall touch on the benefits that are in scope of this measure, a point that was raised by the noble Baroness, Lady Sherlock. I think the noble Baroness wishes to restrict the power to working-age benefits, but pension-age benefits are not immune to fraud and error—I wanted to address that—and it is our duty to ensure that these benefits are paid correctly and in line with the benefit eligibility rules that Parliament has previously agreed. Every payment that the DWP makes has eligibility criteria to it. Parliament has considered these criteria in the passage of the relevant social security legislation, and the Government have a responsibility to check that payments are being made in line with those rules so that taxpayers’ money is spent responsibly.
Lord Davies of Brixton (Lab)
Pension benefits other than pension credit have eligibility criteria attached, but I do not know any eligibility criteria applying to pensions that you could discover from someone’s bank account.
Viscount Younger of Leckie (Con)
The example that the noble Lord will be aware of links to what the noble Lord, Lord Sikka, was saying about some pensioners who have moved abroad but, for whatever reason, have not told us that they have done so and continue to receive the uprating. The figure for the fraud aspect—or it could be error—linked to state pensions is £100 million.
Lord Davies of Brixton (Lab)
Presumably the DWP already knows the address of the bank account to which an overseas pension is being paid. Why does it need to know any more?
Viscount Younger of Leckie (Con)
My understanding is that it needs to have these powers to be able to cover the ground properly. I say again that these powers are limited, and whatever comes from the data that is requested from the third parties will end up being, we hope, limited. Even then, it may not be used by us because there is no need to do so.
The power covers all relevant benefits, grants and other payments set out in paragraph 16 of new Schedule 3B to the Social Security Administration Act 1992, as inserted by Schedule 11 to the Bill. To remove pension-age payments from the scope of the power would significantly undermine our power to tackle fraud and error where it occurs. Pension-age payments are not immune to fraud and error, as I have mentioned. I will give an example of that. The noble Baroness, Lady Sherlock, asked whether people would be notified of their bank accounts being accessed.
Baroness Lister of Burtersett (Lab)
Before the Minister moves on, I asked specifically about child benefit. Could he please answer that?
Viscount Younger of Leckie (Con)
I know that I said earlier that child benefit was not included. I will clarify that child benefit is not a benefit for which the DWP is responsible or has any functionality for. This measure will be exercised by the DWP Secretary of State, and we cannot use this power for that benefit.
I was in the middle of answering a question from the noble Baroness, Lady Sherlock.
Viscount Younger of Leckie (Con)
I will finish this answer, if I may. The DWP personal information charter lists banks and financial institutions, and other parties, among the parties with which DWP may share data and from which we may receive data. It also lists checking accuracy and preventing and detecting fraud among the purposes for which we may share or receive information.
A claimant will not be notified if their account details have been returned to DWP by a third party as that could alert fraudsters to the criteria, enabling them to evade detection—I think that is a valid point—but they will be notified if a DWP agent determines that a review is required as a result of the information provided by the third party. That notification will be done through the business-as-usual processes.
Moving on to defining working-age payments in legislation, which relates to the final amendment in this group, Amendment 235, which was tabled by the noble Baroness, Lady Sherlock, it would require the Government to specify in regulations the working-age benefits with which this power could be used. As she demonstrated, there is a wide range of benefits and therefore potential avenues for fraudsters to seek or exploit or for error to creep in. That is why it is important that the power enables the department to respond proactively as new fraud risks emerge.
That said, as the noble Baroness knows, the power will not be exercisable in all the benefits she listed—I took note of her long list—such as child benefit, which we have just mentioned, because the legislation is drafted in such a way that it could reasonably be exercised in relation to benefits for which the Secretary of State is responsible. I reassure the noble Baroness, Lady Sherlock, and the Committee that in the first instance, we plan to use this with universal credit, employment and support allowance—ESA, pension credit and housing benefit. That is the way forward.
There may be a number of questions that I have not addressed, but I hope that I have continued to make the case for why this measure is so important and our aim to tackle fraud and error. I continue to make the case that it is proportionate and that proportionate safeguards are in place. With that, I hope the noble Baroness will agree to withdraw her amendment.
Baroness Kidron (CB)
Will people with power of attorney over the account of someone who receives a benefit also be caught up in all this? That is another vulnerable group, so this could be extensive and quite worrying. Secondly, I am concerned by the Minister’s answers on this group. They have made me feel somewhat more strongly than I did when giving my response on the previous group, so I feel I should put that on the record.
Viscount Younger of Leckie (Con)
That is understood. I know that I need to provide further reassurances. Attorneys are included for the reasons that I set out for appointees.
Baroness Sherlock (Lab)
My Lords, I thank the Minister for taking the time to try to answer the questions. I know that we have given him a hard time, but I thank him for responding so graciously.
He did not take the opportunity to explain the process simply to the Committee. It may be that it is too difficult to explain simply or that, in fact, he can explain what they intend to do, but the powers allow them to do something much wider than that. It would be helpful if he could reflect before he writes as to how best to frame this. I think I heard him trying to say to the Committee that people think that more information is being handed over than will in fact be handed over. If that is the case, it would be helpful if he could spell that out because that would at least begin to help people understand better what is going on.
Secondly, in responding to me, the Minister focused, understandably, on the content of the amendments. I was trying to explain that the reason they are probing is that it is quite hard to get a handle on this. It is a big, sprawly thing, and I am trying to find a way of nailing some jelly to the table; I am trying to find ways of containing it. I still do not know which benefits the Government can use the powers over and which ones they intend to. It is a great step forward to know where they are going to start; that is really helpful. I am also grateful for the clarity, whether people are happy or not, that the Government intend to use the powers on the state pension and make that clear because that was not the impression given in the House of Commons when the matter was debated there. That is a helpful piece of clarity for the Committee and the wider community.
I know this is hard; fraud is difficult. A case was mentioned where an organised fraud gang stole more than £50 million in social security benefits. I know it is hard, and I know it is hard for the DWP to understand precisely where these things will lead when you begin to go there. I understand that if it is too boxed in, it makes it difficult to be able to follow where the fraudsters go, who are often one step ahead of the Government. I get all of that, but there is a risk that when it has spread so widely, the level of concern gets to the point that it will not be as publicly acceptable as the Minister thinks it is. I ask him to take the opportunity, when he goes back to the department, to talk to colleagues and think about what kind of assurances the Government could try to find a way of giving to people, either staging processes or government oversight. I ask him to think about that because the kinds of concerns he has heard here will only increase as the powers start to unfold.
In the next group of amendments, which I think will now be discussed on Wednesday, I want to dig further into the question of who the data and account notice can be given to and what criteria will be used. That will be another chance to flush out some things, so I give notice now that I would like the Minister to look into those areas next. I am grateful for his efforts and to all Members of the Committee who have explored this matter. I beg leave to withdraw my amendment.
House of Lords
Deaths of Members
The Senior Deputy Speaker (Lord Gardiner of Kimble)
My Lords, I regret to inform the House of the deaths of the noble Baroness, Lady Gardner of Parkes, on Sunday 14 April and the noble Baroness, Lady Massey of Darwen, on Saturday 20 April. On behalf of the House, I extend our condolences to the noble Baronesses’ families and friends.
Medical Student Places
(3 weeks, 5 days ago)
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Baroness Merron
To ask His Majesty’s Government what progress has been made on plans to increase the number of medical student places in England.
Lord Evans of Rainow (Con)
My Lords, we are on track to meet the NHS Long Term Workforce Plan and aim to double the number of medical school places in England from 7,500 to 15,000 places a year by 2031-32. We have allocated 205 additional medical school places and provisionally allocated 350 more for the 2024-25 and 2025-26 academic years respectively. In 2020, the Government completed an expansion in the number of medical school places in England from 7,500 per year, a 25% increase.
Baroness Merron (Lab)
My Lords, may I start by saying on behalf of these Benches that we wish to express our deep condolences on the sad passing of Baroness Gardner of Parkes and our colleague Baroness Massey? May their memories be for a blessing.
Ministers recently advised the Office for Students that only 350 additional places for trainee doctors would be funded in 2025-26. On the basis that, at this rate, it will take over 21 years to meet the Government’s promise to double the number of medical training places, what assessment has been made of the effect this will have on medical schools, which had in fact been told to plan for considerably greater numbers? Where does this leave the Government’s promise to double medical places by 2031?
Lord Evans of Rainow (Con)
My Lords, I would like to follow the noble Baroness’s tribute to Baroness Gardner of Parkes and Baroness Massey. I also pay tribute to the late Doug Hoyle, an outstanding north-west MP and an outstanding public servant.
We remain committed to the long-term workforce plan’s target to double the number of medical school places by 2031 and are in fact ahead of schedule. The planned expansion is not uniform in each year; it increases substantially in later years. The timeline allows for new and existing medical schools to build the physical and teaching capacity needed, and to develop curricula and receive General Medical Council approvals where needed.
Baroness McIntosh of Pickering (Con)
My Lords, may I add my condolences to those who have spoken on the loss of Baroness Massey and, in particular, Baroness Gardner, who shared an office with us in this building? She will be greatly missed. Long may their memories live, and may they rest in peace.
I declare my interest with the Dispensing Doctors’ Association. While the increased number of places at medical schools is welcome, does this take account of the large number of people who are expected to retire in the next five to 10 years—especially GPs—and are currently only in their 50s?
Lord Evans of Rainow (Con)
I thank my noble friend for that question. She is right to point out that certain GPs in their 50s retire, but the Government are committed to increasing the number of GPs. As I indicated in my Answer, there is a substantial number of younger new GPs in the pipeline.
Lord Allan of Hallam (LD)
My Lords, I associate these Benches with the condolences to the families of the noble Baronesses, Lady Gardner and Lady Massey. The Government, in their response to a Guardian article that queried the student numbers, said that numbers will be increasing “exponentially until 2031”. Exponentially is an impressive adverb that is sometimes used to mean something that is fast and getting faster. It also has a more precise meaning, and there is a formula. Will the Minister share the formula being used between now and 2031, so that we can see how many places will be allocated each year?
Lord Evans of Rainow (Con)
I thank the noble Lord for that question. I do not have a formula in my briefing pack, but I will ask that question and refer the answer back to the noble Lord. I would also point out not to believe everything that you read in the Guardian.
Lord Naseby (Con)
Is my noble friend aware that, out of every three sixth formers who wish to become a doctor, only one will find a medical school place? Is that not a tragic loss, at a time when we are really short of doctors? At the other end of the spectrum, we also know that the number of doctors who work in the NHS once qualified is going down. Against that background, surely, we should have another look at our forecasts and the provision we make for more medical school places.
Lord Evans of Rainow (Con)
In my initial Answer, I pointed out that the Government are increasing the number of medical school places, but he raises an important point. If he has any specific cases of students not getting a place and lets me know about them, I will look into them.
Lord Watts (Lab)
My Lords, the Minister is not responsible for the crisis we are facing in the health service, but we have had 13 years of cuts in training for doctors. Does he not accept that it was a major mistake not to recruit more doctors and make available more places in universities to train the number of doctors we need?
Lord Evans of Rainow (Con)
The noble Lord raises an important point about the number of doctors, but I fear I am repeating myself. The Government have laid out in their long-term NHS workforce plan that we will have a significant increase in the number of doctors—from 7,500 each year, in five new medical schools. So that may have been the case in the past, but it will not be in the future through to 2030-31.
Lord Patel (CB)
My Lords, the training of doctors requires expansion of resources in pre-clinical years and particularly clinical years. It also requires expansion of foundation year one and the useless foundation year two, which are clinical years in which they train in hospitals and GP practices. What are the Government doing to finance both the clinical years and the foundations years?
Lord Evans of Rainow (Con)
One of the reasons why we cannot accelerate the training of doctors in GP practices, for example, is capacity. That is why the Government have funded five new training hospitals. The noble Lord is absolutely right, but it is about capacity and that is why we are ramping it up, and it will increase in time as outlined in my initial Answer.
Baroness Kingsmill (Lab)
We need to keep the doctors we already have, not just the ones we are training for the future. Does the Minister know how many doctors are leaving the country and going to places such as Australia?
Lord Evans of Rainow (Con)
Every year, approximately 4% of all doctors registered with the General Medical Council—roughly 300,000 doctors on the register—relinquish their licence to practise. The vast majority go on to work in the NHS after completing their foundation programme training. GMC analysis shows that 93% of doctors enter speciality or GP training and are working as a doctor in the UK within three years of completing the foundation programme. The noble Baroness refers to Australia specifically. It is my understanding that for a newly qualified doctor who has spent several years working hard to qualify, it is quite an attractive place to practise as a doctor, but they do come back to the United Kingdom.
Lord Sandhurst (Con)
My Lords, last year it was reported that 25% of doctors drop out after two years’ foundation training. After five years, the drop-out rate in total is 40%. So increasing the number of students is not the answer, or any part of it. Is not the crucial thing to ensure that young doctors are encouraged to remain in training? That may mean more care in selecting them in the first place, but it also means making it better for them while they are training.
Lord Evans of Rainow (Con)
Student drop-out is not unique to the medical sector. My noble friend is absolutely right: it is very important that, before students decide to take on a lengthy medical course, they decide whether it is right for them.
Baroness Bloomfield of Hinton Waldrist (Con)
My Lords, despite the myriad problems faced by the Betsi Cadwaladr health department in north-west Wales, perhaps my noble friend would join me in congratulating Bangor University on opening a new medical school. The first cohort of students will start in September this year.
Lord Evans of Rainow (Con)
My noble friend is an advocate for everything Wales. Of course, I will do exactly that: congratulations all round.
Lord Grocott (Lab)
My Lords, we have heard about trained medical staff going to work overseas. We are also very familiar, of course, with the other end of the discussion. Many trained medical staff come from overseas to work in our country, to the great benefit of the health service. Surely, the answer to both those challenges has to be for us to train and retain medical staff in this country, neither exporting them somewhere else nor being entirely dependent on imports from somewhere else.
Lord Evans of Rainow (Con)
I agree with the noble Lord. That is why the long-term workforce plan commits to improving retention by improving the culture and leadership to ensure that up to 130,000 fewer staff will leave the NHS over the next 15 years. But the noble Lord is absolutely right: doctors from overseas, trained in third-world countries and elsewhere, come to our country and, as the noble Baroness said earlier, also go to attractive places such as Australia. As I say, young people like to experiment with other countries but do come back. It is also a testament to the NHS that so many foreign-trained doctors decide to practise here.
Fur: Import and Sale
(3 weeks, 5 days ago)
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Baroness Jones of Moulsecoomb
To ask His Majesty’s Government whether they are taking steps to ban the import and sale of fur.
The Parliamentary Under-Secretary of State, Department for Environment, Food and Rural Affairs (Lord Douglas-Miller) (Con)
My Lords, I declare my interest as set out in the register. Fur farming is banned in the UK, and there are already import restrictions, which means that some skin and fur products may not be legally imported. In Our Action Plan for Animal Welfare, Defra committed to explore further potential action in relation to the import of fur from abroad, but we have continued to build our evidence base, including commissioning a report from our Animal Welfare Committee.
Baroness Jones of Moulsecoomb (GP)
The action plan to which the Minister refers was produced in June 2021, nearly three years ago. Knowing that we are a nation of animal lovers and that the number of animals killed for fur is estimated worldwide at 130 million, most of them kept in appalling conditions and suffering mental and physical distress, why on earth cannot the Government bring a popular Bill, for a change, to this House, so that it can vote for something happily—instead of the Rwanda Bill, for example?
Lord Douglas-Miller (Con)
My Lords, there is a good news story on this, because the volume of fur that is imported and exported has fallen by 50% in the past five years. In the action plan for animal welfare, Defra committed to explore potential action in relation to the import of fur from abroad. The call for evidence that Defra published in 2021 was a key step in delivering that commitment. A summary of the replies received should be published in due course; in the meantime, we are continuing to build our evidence base on the fur sector, which will be used to inform any future action on the fur trade. We have also commissioned a report from our expert Animal Welfare Committee, which I mentioned earlier, on what constitutes responsible sourcing in the fur industry. This report will support our understanding of the fur industry and help to inform our next steps.
Baroness Bakewell of Hardington Mandeville (LD)
My Lords, the import of fur is unnecessary. The killing of Canadian bears for their pelts is still used to make bearskin headgear for the Grenadier Guards at Buckingham Palace. These come at a minimum cost of £650 each. The MoD orders between 50 and 100 bearskins each year. In 2020, the MoD stated that the quality of alternative material did not match natural fur. Surely, the Minister would agree that it is time for this unnecessary practice to be discontinued without delay.
Lord Douglas-Miller (Con)
My Lords, the wearing of bearskins by the Guards division is a matter for the Ministry of Defence. We are continuing to build our evidence base on the fur sector, which will be used to inform the future of the fur trade, and we will continue to share this evidence with other government departments, including the Ministry of Defence.
Baroness Fookes (Con)
My Lords, what has happened to joined-up government? Is not this a matter for environmental and welfare considerations, and are they and the Ministry of Defence to be completely separated? I would suggest not. On the wider question, I am delighted by the progress that is being made, but could my noble friend speed it up a bit? I want to be alive when something really happens.
Lord Douglas-Miller (Con)
My noble friend is in very robust form, and I can see will be for many years ahead. I commit to providing a response to the consultation and the wider other brief as soon as I can.
Baroness Hayman of Ullock (Lab)
My Lords, surely the Minister would agree that, in light of the new legislation that is coming in on the banning of the import of shark-fins and the progress of the Government-backed Private Member’s Bill on banning cruel puppy imports, the trade measures, such as a total ban on the import of fur and foie gras, which also safeguard animal welfare standards, should have equal priority. That is clearly not the case at the moment.
Lord Douglas-Miller (Con)
The Government made it clear in their manifesto commitment that in all our trade negotiations we will not compromise on our high environmental protection, animal welfare and food standards. The UK is rightly proud of the animal welfare standards that underpin our high-quality produce. Imports into the UK must comply with our existing import requirements, such as meeting the United Kingdom’s slaughter standards.
Baroness Redfern (Con)
My Lords, what assessment has my noble friend the Minister made of the UK’s role in the global fur trade and of the volume of the import and export trade in animal fur and fur products over the past five years?
Lord Douglas-Miller (Con)
I thank my noble friend for her question. Between 2017 and 2019, the UK imported around £61 million-worth of fur or fur-based products and we exported around £35 million of fur and fur-based goods. The majority of these were for apparel and clothing. In the period since then—the latest report was in 2023—the volume and the numbers have exactly halved.
Baroness Owen of Alderley Edge (Con)
My Lords, the RSPCA has stated that one-quarter of children aged 10 to 18 have witnessed animal abuse videos online. What action are the Government taking to tackle the increase in this content? What education are we providing to children on the importance of animal welfare?
Lord Douglas-Miller (Con)
I thank my noble friend. I was not aware of those statistics from the RSPCA, but they sound very concerning and it is a matter that the Government will be taking very seriously. As for the content, I will refer my noble friend to the Home Office, because it sounds highly inappropriate for children to be watching that. I will take the issue of education back to my department.
Baroness Bennett of Manor Castle (GP)
My Lords, last week in the Grand Committee, the noble Lord and I were agreeing about the importance of biosecurity and the threat presented to human and animal health—indeed, One Health. During Covid 19, we saw huge numbers slaughtered on mink farms because of the risk of transmission. Does the Minister agree that the fur farms that keep animals in such dreadful conditions as my noble friend referred to present a threat to the security of all of us, in terms of the transmission of zoonoses? If we were to ban the imports, we would actually be making the world safer for all of us by helping to discourage those farms from continuing and presenting the biosecurity threat that they do.
Lord Douglas-Miller (Con)
The noble Baroness raises a very good point. We have been in discussions with our colleagues in Europe about these issues over the period. I can assure the House that there is no current risk, or the risk is assessed as extremely low, in terms of any transfer of diseases across from Europe. I know that where they do get outbreaks, they go to a policy of cull straightaway.
Baroness Hussein-Ece (LD)
My Lords, a year ago the Government staged a U-turn on the promise to ban fur imports. We do not know the reason for that, but we do know that, as we have heard mentioned, in April 2021 there was a call for evidence and the Government received 30,000 replies. Since then, we have heard nothing, so will the Minister say when that evidence, the 30,000 responses to the call for evidence, will be released?
Lord Douglas-Miller (Con)
The noble Baroness is absolutely right about the numbers there. As I said earlier, I do not have an exact date for that response, but I am pressing for it to come out as soon as possible.
Lord Watts (Lab)
My Lords, what are the arguments for not banning fur products coming into the country? It does not seem to me that there is any important reason why we should not ban them. I think the vast majority of the public would support that move. What arguments are the Government putting forward for not banning them?
Lord Douglas-Miller (Con)
I thank the noble Lord for his question. I am not in a position to go into that level of detail right now, so I will write to him.
Lord Kamall (Con)
Can my noble friend the Minister tell us whether his department has done any analysis of the source of fur from animals? What I mean by that is when animals are killed for fur, what percentage are killed specifically for fur; what percentage are killed for something else, such as meat, and the fur is a by-product; and what percentage are killed to control an animal population?
Lord Douglas-Miller (Con)
I am not aware of any analysis on that, but I will look into it and take it back to the department.
Baroness Jones of Moulsecoomb (GP)
My Lords, I asked this specific Question three years ago. I have not had an answer in those three years and I do not like the Answer today. Is it any wonder that I get so annoyed with this Government? Please, bring us back a proper answer on this.
Lord Douglas-Miller (Con)
I am distressed that we are causing the noble Baroness so much discomfort—that is certainly not the intention of the Government nor, indeed, my department at Defra. As I stated, I do take a personal interest in this; I have attended a number of meetings on it over the last month or so and I am endeavouring to get a response shortly, which I hope will satisfy the noble Baroness.
International Mother Earth Day
(3 weeks, 5 days ago)
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Baroness Anelay of St Johns
To ask His Majesty’s Government what plans they have to mark International Mother Earth Day, and to fulfil the United Kingdom’s commitments set out in their White Paper on International Development, published in November 2023 (CP 975).
The Minister of State, Department for Environment, Food and Rural Affairs, and Foreign, Commonwealth and Development Office (Lord Benyon) (Con)
My Lords, the UK has previously attended UN events to mark International Mother Earth Day, recognising that development, nature and climate are interconnected. We are progressing our White Paper commitments, helping to end extreme poverty and address climate change and biodiversity loss. The UK ensured that nature remained central to the international agenda at COP 28, announcing £576 million to halt forest loss and protect nature. Our £11.6 billion international climate finance commitment includes £3 billion to protect, restore and sustainably manage nature.
Baroness Anelay of St Johns (Con)
My Lords, on International Mother Earth Day, which falls today, I welcome the Government’s White Paper commitment to protect forests, land and natural resources. Can my noble friend please give a couple of significant practical examples of where the Government will assist those countries in sub-Saharan Africa that are facing substantial desertification and illegal practices on mineral extraction?
Lord Benyon (Con)
Protecting natural resources in sub-Saharan Africa continues to be a focus for the United Kingdom. Our support includes the Investments in Forest and Sustainable Land Use program. This is mobilising private investment into forest protection, restoration and sustainable land use. Its highly successful first phase, which ran from 2017 to 2024, operated in eastern, west and central Africa. Our Biodiverse Landscapes Fund aims to reduce poverty and protect and restore biodiversity in environmentally critical landscapes, including the Kavango-Zambezi Transfrontier Conservation Area and areas in Madagascar and the western Congo Basin. There are many other examples but those are two, to answer my noble friend’s point.
Baroness Blackstone (Lab)
My Lords, given the importance of deforestation as far as climate is concerned, can the Minister celebrate Earth Day by publishing this week the Schedule 17 forest risk due diligence regulations? He assured the House before Easter that they would be published shortly, so why not this week?
Lord Benyon (Con)
This forest risk commodities regulation is a good news story and the UK has been pushing for it. The publication of the statutory instrument is imminent and the House will be able to debate it. The UK will be one of the countries at the forefront of introducing sensible, well consulted regulations that will protect forests by making sure that supply chains are rigorously enforced.
Lord Purvis of Tweed (LD)
My Lords, given the decision last week in Scotland, where I live, for Green Party Ministers to ditch their target on climate change, and the concerns raised by the head of the Climate Change Committee that the UK is less ambitious on climate than it had been, does the Minister agree that emerging economies need the UK to be reliable and dependable in planning for climate alleviation policies? It is why I asked the Minister in a debate in January whether the climate finance that he announced and referred to was new money. Subsequently, independent analysis has suggested £2 billion pounds of that has been recycled. What is the point of making announcements when they are reneged on, or indeed when the funding given is recycled?
Lord Benyon (Con)
I am sorry but I cannot take that. The £11.6 billion, one of the largest commitments by a country, is absolutely solid. If the noble Lord wants me to be completely frank, I suspect that our spending on climate finances is probably nearer to £15 billion or £16 billion if I take into account other things that other countries calculate as international climate finance. The noble Lord really cannot say that we are somehow reneging on this. The Prime Minister and the Government are absolutely committed to this, and we should be proud that we are a country that has halved our greenhouse gas emissions and that we are the fastest reducer of greenhouse gas emissions of any country in the G7.
Lord Collins of Highbury (Lab)
My Lords, the noble Baroness mentioned the extractive industries. The UN 2021 report recognised that extractive industries have the potential to drive growth and reduce poverty in developing countries, yet it also recognised that most of those developing countries are locked into patterns of primary product exportation specialisation. That constitutes a barrier to long-term economic growth. One of the UN’s calls for action was to systematically include civil society and vulnerable groups affected by the green transition—including women and indigenous populations—in the design, implementation and monitoring of all extractive operations. What are this Government doing to ensure that this call for action applies, and that we involve those people who are most directly affected?
Lord Benyon (Con)
I entirely agree with the noble Lord. At recent COPs, particularly the CBD in Montreal 14 months ago, we spent a lot of time talking to representatives of local communities and indigenous peoples, to make sure that we are making this relevant to them. If the noble Lord wants one example, I will mention digital sequence information, which is potentially a £100 billion a year new nature fund, where the money will go direct to local communities and indigenous people. It is an example of the priority we are making them, to make sure that they are part of the conversation.
Baroness Hayman (CB)
My Lords, I declare my interests as set out in the register. The scale of the cost of servicing debt for emerging economies was highlighted at the World Economic Forum last week. Are His Majesty’s Government open to pursuing debt swaps as a way of allowing climate-vulnerable countries to implement the very necessary adaptation to combat the damaging effects of climate change that are all too obvious?
Lord Benyon (Con)
The noble Baroness is absolutely right that debt holds back countries in a completely unfair way, particularly those which are most vulnerable, and we are committed to improving the international debt system. We are pushing for improvements to the G20 common framework, and we use our position in official creditor committees to help to return countries to debt sustainability. One example I would give her is that we in the UK pioneered the climate resilient debt clauses, which pause debt repayments when a developing country is hit by a disaster. I am delighted that France and three other countries have followed suit, and that this is now becoming an established form of debt alleviation.
Lord Howell of Guildford (Con)
My Lords, in the White Paper we are talking about, there is a short but quite good section on working with the Commonwealth. Given that security goes with development—there is no development, let alone green development, without reasonable security and political stability—would the Minister remind the authors of this aspect, particularly as the Chinese are now actively undermining the security of numerous Commonwealth countries? The Solomon Islands is a good example of the latest one, but there are many others. Should we not have this aspect of the whole development question rather higher in the agenda than we seem to have it now?
Lord Benyon (Con)
My noble friend raises a really important issue in the run up to CHOGM, where we want to show that we are using the Commonwealth in an effective way, in supporting small island developing states in particular to manage the adaptation to climate change. It is being held in Samoa, so his point is absolutely right. On Friday of last week, I was in Cyprus at the Commonwealth Ocean Ministers Meeting. You cannot sit and listen to the representative from Tuvalu without understanding the importance of this to them. It is an existential threat, and the work we are doing on SIDS this year in the run up to CHOGM, and in the future, shows that it is an absolute priority, and the Commonwealth is an excellent way of supporting so many of them.
The Earl of Devon (CB)
The Minister recognises the importance of indigenous land management for environmental benefit. Can he comment on why upland farmers in the UK are so mistreated by the SFI as it is currently set out?
Lord Benyon (Con)
That is quite a leap from the Pacific but I will try to answer the noble Earl. He should look at the amendments that have been made to the SFI recently, which have been broadly welcomed by upland farmers. Where there was an actual or perceived discrepancy between lowland and upland farming, that has been addressed. It is vital that we maintain a vibrant upland farming community, which is absolutely the Government’s intention. Our grant schemes—the sustainable farming incentive, Countryside Stewardship and the farming in protected landscapes fund—show that these are people who matter to us, our landscape and the future of farming in this country.
Paying Polluters: UN Report
(3 weeks, 5 days ago)
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Lord Browne of Ladyton
To ask His Majesty’s Government what assessment they have made of the United Nations Special Rapporteur report on Paying polluters: the catastrophic consequences of investor-State dispute settlement for climate and environment action and human rights, published on 13 July 2023.
The Parliamentary Under-Secretary of State, Department for Energy Security and Net Zero (Lord Callanan) (Con)
My Lords, investor-state dispute settlement mechanisms offer investors an independent means of legal redress to seek compensation following a breach of international investment agreements. The report notes that, outside the UK, investors have brought ISDS claims against climate change measures; however, the UK has not faced a successful ISDS claim. On 22 February we announced withdrawal from the energy charter treaty, to avoid remaining in a treaty not aligned with our energy security and net-zero ambitions.
Lord Browne of Ladyton (Lab)
My Lords, on 7 December we had a debate on a Motion moved by the noble Baroness, Lady Hooper, on Latin America. In the context of our trade deal with Colombia, my friend, the noble Baroness, Lady Coussins, raised the issue of the inherent manifold injustices of the ISDS. The Minister responding to the debate, the noble Lord, Lord Ahmad, wrote in response:
“ISDS is an effective means of resolving … disputes”,
and the Government are
“content with the standard of protection”
provided. So it is surprising that none of the free trade deals concluded since Brexit contains an ISDS—and the absence of one is an explicit goal of our negotiations for a UK-Canada deal. What is the Government’s view of an ISDS as a means of resolving disputes? If they have shifted their view, what are they doing to ensure that their new approach is reflected in trade with Colombia?
Lord Callanan (Con)
This is a complicated area. Of course, these treaties are bilateral, and they also help to protect the investments of UK companies investing in other overseas territories. However, the UK’s investment policy is designed to protect the UK’s right to regulate in the public interest, and so far we have been successful in that, in that we have not seen any successful claims against us.
Baroness Coussins (CB)
My Lords, the UN Working Group on Business and Human Rights has said that the ISDS mechanism incentivises investor irresponsibility. Currently there is a case of a UK-listed company using the ISDS in Colombia in a way that undermines the fundamental interests and rights of the Wayuu indigenous people. As penholder at the UN for the Colombia peace process, what are His Majesty’s Government doing to discourage such activity?
Lord Callanan (Con)
I thank the noble Baroness for her question. I cannot comment on cases that are currently ongoing, but we will certainly bear her comments in mind when we consider our policy on this matter.
Earl Russell (LD)
My Lords, with fossil fuel and mining industries already having won more than $100 billion in awards and at least 175 treaty-based ISDS cases closed or pending that are directly related to environmental measures, does the Minister agree that foreign investors are using the dispute settlement process to seek exorbitant compensation from states that seek to strengthen their environmental protection? What actions are the Government taking with partners and allies on the international stage to try to find solutions to these problems?
Lord Callanan (Con)
As the noble Earl is probably aware, there are discussions in the OECD at the moment about the use of these clauses. As I said, we are responsible for the ones that we have signed, recognised and arbitrated against, and we very carefully ensure that these clauses protect our right to regulate in these circumstances on energy and climate change matters. The success of that has meant that we have seen no successful claims against the UK.
Baroness Blake of Leeds (Lab)
My Lords, while we will of course hear a lot about the importance of investor confidence, it is as important to ensure that Governments, particularly of less affluent and more vulnerable nations, are able to fulfil their climate commitments. It is estimated that those Governments fulfilling their commitments under the Paris Agreement might be liable to pay up to $340 billion in future cases under this system. Can the Minister tell us the Government’s assessment of what the impact of this system will be on limiting the increase in global temperatures to 1.5 degrees centigrade above pre-industrial levels?
Lord Callanan (Con)
The noble Baroness is using the generality to refer to the specific. ISDS clauses are very useful in a whole range of different areas. I accept her point that there is some evidence of their misuse in the case of energy and climate change policies, and we will work with international partners to see how this can be mitigated. We are very careful to make sure that the ones to which we agree preserve our right to regulate. Other countries take their own decisions, of course.
Lord Sikka (Lab)
My Lords, many developing countries are handicapped by clauses in foreign direct investment agreements—sometimes called stabilisation clauses—that forbid the hearing of disputes in local courts. As a result, local courts’ lawyers are unable to develop the expertise or necessary institutional structure to combat corporate power. What steps are the Government taking to ban the inclusion of such clauses in FDI agreements, at least for UK companies?
Lord Callanan (Con)
All such agreements are different. Many rely on international arbitration panels that are appointed by the complainant company and the defendant company with an independent chairman. We are very careful in how we regulate these matters and which clauses we agree to. As I said earlier, we will work with other countries to look at their particular disputes as well.
Lord Purvis of Tweed (LD)
Is the Minister aware that one of the concerns around ISDS is that it is a secret process, as opposed to a multilateral judicial process that is more transparent? Given the fact that ISDS can be used against small emerging economies and deliberately facilitated by legal funds based in the UK, what discussions have the Government had with our legal community to ensure that ISDS is not just about protecting UK interests and that the legal community in the UK is not using it strategically against emerging economies that do not have the capacity and secret processes to defend themselves?
Lord Callanan (Con)
As I said, ISDS clauses work both ways. They also seek to protect the interests of UK companies investing in other overseas economies. Any state that wishes to regulate against the interest has to prove that it is being transparent and fair, not discriminating against foreign investors, et cetera. All these criteria are used to make judgments about whether cases will proceed.
Lord Davies of Brixton (Lab)
We discussed ISDS arrangements in the context of the CPTPP Bill recently, and a number of noble Members expressed concern about the impact on environmental standards. The response from the Government Front Bench was, “Not to worry; it won’t be used in this way”. That is clearly not the case with Colombia. It has faced at least 21 cases under the ISDS process, mainly for mining companies and mainly questioning the effect on the country’s environmental standards. Given the pressure that Colombia is under in its transition to full democracy and peace, would the money that it inevitably has to spend on defending these cases, and in some instances paying damages, be better spent on maintaining the peace process?
Lord Callanan (Con)
I am sure it would, but we are responsible for what clauses we agree to in the UK. We always protect our right to regulate, and we seek not to take actions that are arbitrary or discriminatory against foreign companies. Ultimately, it is a question of what clauses Colombia agrees to, what criteria it uses and how it will be arbitrated, so it is a difficult question to answer.
Lord Kamall (Con)
My noble friend will be aware that when we were both in the European Parliament we used to debate the issue of ISDS, and that one of the reasons that ISDS was asked for by investors was to ensure they had confidence, particularly when there was no confidence in the local legal system. The other side of that is that big companies were perceived to get preferential treatment in being able to go to the ISDS process, rather than through the legal system. We have to look at the trade-offs, and maybe one of the things that my noble friend’s department could look at is the impact of not including ISDS agreements and how much that would affect outward or inward investment in these countries.
Lord Callanan (Con)
My noble friend makes a powerful point; of course, it works both ways. We want to protect the interests of UK companies, which sometimes operate in very hostile, non-democratic countries with unclear or murky legal systems. By the same token, we need billions of pounds of investment into the UK—we are the top European destination for inward investment—to help us in our energy and climate change transition, so it is important as well that we demonstrate that we are liberal and open to companies investing here in the UK. These clauses help to deliver that, but they need to be structured in the right manner, transparent and liberal.
Arrangement of Business
Baroness Williams of Trafford (Con)
My Lords, it may be helpful for me to explain to the House how we expect business to run today. As noble Lords will know, we are expecting a further message from the Commons on the safety of Rwanda Bill this afternoon. We will interrupt business before the House to consider that message.
Before setting out the process for today, I acknowledge the frustration that noble Lords have felt—I have been at the brunt of that as well—that there was less-than-adequate notice of this and that it is scheduled to take place on the first day of Passover. I can assure noble Lords that this was very carefully considered, and as the Government Chief Whip, I take my duties to this House as a whole, and to the usual channels in particular, extremely seriously. I can also assure the House that it remains my intention to facilitate government business collaboratively, with the agreement of the usual channels.
With regard to how business will run today, ultimately we were also at the mercy of scheduling in the other House. The plan remains to start Committee on the leasehold Bill after Oral Questions, and we will then pause proceedings on that Bill once we are ready to commence consideration of the Commons message on Rwanda. Once the message has been received, we will place a message on the annunciator signalling the beginning of a 30-minute window to table amendments on Motions. Once that closes, we will start debate on that Bill as soon as all the relevant paperwork is ready. The usual channels have agreed that this will not be before 6 pm, and my best guess is that it will be around 7 pm, but that depends on many factors and it could be earlier or later. If we are ready to start proceedings on Rwanda before 7.30 pm, we will consider the Commons message before debate on the QSD in the name of the noble Lord, Lord Farmer. If it is not ready until later, we will take the QSD before considering the Rwanda Bill. If there is time, we will resume Committee on the leasehold Bill until the usual rising time of about 10 pm. If further rounds of ping-pong are required on the Rwanda Bill, we will sit to take them this evening, and those could well take place after 10 pm.
I thank all noble Lords in advance for their patience. We will ensure that we place details of the first round and any subsequent rounds that are needed on the annunciator as soon as possible. The Government Whips’ Office would be happy to assist further with any questions. I also thank the administration and particularly the catering staff, who have already made swift provision for services beyond 10 pm should noble Lords and staff need them.
Pet Abduction Bill
Monday 22nd April 2024
(3 weeks, 5 days ago)
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Building Societies Act 1986 (Amendment) Bill
Monday 22nd April 2024
(3 weeks, 5 days ago)
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Zoological Society of London (Leases) Bill
Monday 22nd April 2024
(3 weeks, 5 days ago)
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Litigation Funding Agreements (Enforceability) Bill [HL]
(3 weeks, 5 days ago)
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Official Controls (Fees and Charges) (Amendment) Regulations 2024
(3 weeks, 5 days ago)
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Lord Douglas-Miller
That the draft Regulations laid before the House on 26 February and 4 March be approved.
Relevant document: 18th Report from the Secondary Legislation Scrutiny Committee (special attention drawn to the first two instruments). Considered in Grand Committee on 18 April.
Employment and Trade Union Rights (Dismissal and Re-engagement) Bill [HL]
Monday 22nd April 2024
(3 weeks, 5 days ago)
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Lord Woodley (Lab)
My Lords, I understand that no amendments have been set down to the Bill and that no noble Lords have indicated a wish to move a manuscript amendment or to speak in Committee. Therefore, unless any noble Lord objects, I beg to move that the order of commitment be discharged.
Leasehold and Freehold Reform Bill
Monday 22nd April 2024
(3 weeks, 5 days ago)
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Baroness Taylor of Stevenage (Lab)
My Lords, I am pleased to start Committee stage of this long-awaited Bill. I understand that it is not correct protocol to reiterate Second Reading speeches in Committee, so I shall not do that, but I believe that there are some long-standing unanswered questions relating to the Bill. Though we will probe some of them through our amendments, it is disappointing and unhelpful to reach this stage without some of those issues being clarified. If the Minister can comment, either in her early responses in Committee, or as the Bill proceeds, it would be helpful.
I hope we do not have to reach Report before we know, for example, the outcome of the consultation on ground rent; whether the Government have given up on their proposals to scrap leasehold as a tenure for flats; how the Government propose to help freehold homeowners who find themselves trapped in what have become known as fleecehold charges for estate management, an issue raised powerfully by the Law Commission again in its recent briefing; whether the Government intend to use the Bill to put right some of the building safety issues around qualifying and non-qualifying leases, including those relating to buildings under 11 metres in height, which undoubtedly would have been better addressed by the Building Safety Act but were excluded; and why proposals for a regulator of property agents—supported across this House, and discussed again just last week—continue to be resisted. We would be grateful for clarification from the Minister on the commencement date of the provisions in the Bill, as she has indicated in a written response to my noble friend Lord Kennedy that it will not be until 2026.
It is worth opening this group by talking about the news reports over the weekend. We learned from the Times that the costly regime of ground rent will continue for a further 20 years. Although those ground rents may be capped at £250, we have not had any official announcement on that yet.
The amendments in this group relate directly to the ban that was introduced on Report in the Commons; it was added in late so it was not able to be properly scrutinised there. So our main question is: when exactly will the Government do what was reported over the weekend? Will they amend the Bill at an even later stage, with even less opportunity to scrutinise?
Lord Young of Cookham (Con)
I want to raise a slightly different point from the one raised by the noble Baroness, who is worried that there are loopholes in the schedule. My concern is slightly different, in that the schedule currently bans a form of lease that is actually beneficial. I refer to an arrangement called Home for Life, which has been operating for some time and is based on somebody who is over 60 selling their home. Homewise, which operates Home for Life, then buys the property to which the person moves and grants them a lifetime lease. That enables them to vacate a large family home, gives them the security of the home they move to and, in many cases, releases a sum of money that enables them to expand their income.
There are a number of exemptions under the schedule; this scheme is not one of them. This is, in fact, contrary to what the Government said when they consulted on this a few years ago, when they made it absolutely clear that they would exempt these leases. I quote from paragraph 252 of the Government’s response to a consultation document, Implementing Reforms to the Leasehold System in England:
“It is not the intention of the policy to affect lease-based financial products (home reversion plans—equity release, home purchase plans—lifetime leases and Islamic/Sharia compliant finance), so long as they do not provide a loophole from which to evade the ban. For both home reversion and home purchase plans the provider acquires the freehold and the consumer has a non-assignable lifetime lease. Because these leases are not assignable to another party there is no risk of such leasehold houses coming onto the open market”.
They concluded:
“We will provide an exemption from the ban for these financial products”.
The product I have just mentioned falls squarely within the terms of the exemption that I just read out, but I am afraid it is caught by the Bill as it now stands. I hope my noble friend the Minister will be able to say that this is an unintentional capture of a worthwhile type of lease and that the Government will provide the necessary amendment downstream so that Home for Life can continue to provide a worthwhile service, which I do not think is a loophole of the kind described by the noble Baroness, Lady Taylor.
Baroness Pinnock (LD)
My Lords, this Bill is really very important. It has been a long time since Second Reading, so I think it is worth reiterating some of the fundamentals that we hope it will achieve.
The first is that this is obviously a huge opportunity to reform the leasehold/freehold property rights and relationships. That is certainly one of the key aspects that we on these Benches will pursue with vigour. It is also an opportunity to tackle the huge omissions in the Building Safety Act to provide remedies for those leaseholders and tenants living in blocks of flats that are under 11 metres or five storeys. As we have all through the debates and discussions on the Fire Safety Act, the Building Safety Act and the levelling-up Act, we on these Benches will continue to pursue the safety of leaseholders and tenants in those blocks of flats, because that is the right thing to do.
On these amendments, we on these Benches acknowledge that there will, of course, be areas in the leasehold/freehold arrangement where the abolition of leasehold impinges on other important rights, so we accept that there will be examples where an exception is justifiably made. However, the noble Baroness, Lady Taylor of Stevenage, is absolutely right to probe the reasons for these exceptions, in this group and in the following group, and has drawn attention to them individually. For example, the noble Baroness drew attention to a situation where the developer has a head lease and has yet to build out to the development. She asked the pertinent question of what happens if leasehold is going to be abolished for houses. Where does that fit in with a development that is ongoing that will be developed under the terms of a leasehold? That is not explained either in the Bill or in the Explanatory Notes.
We on these Benches understand the importance of this for historic estates that are now owned by the National Trust in England, Wales and Scotland. The purpose of the leases in those instances ought to be protected, because the overwhelming responsibility is the protection of our national heritage. That makes good sense. However, although the schedule provides details of which properties are eligible for what was described as “permitted leases” under the tribunal certification, what is not clear in either the clauses or the schedule, or in the Explanatory Notes, is what criteria the Government are using to enable some leaseholds to be described as permitted. Can the Minister provide the reasons for the choices made by the Government in determining permitted leases in Schedule 1? This is important because the legislation will be challenged in the future. It is therefore vital that, before we get to Report, we understand the reasons, as well as the purpose, behind the tribunal certification. Perhaps the Minister can provide the details of the regulations that are to be provided to the tribunal for making those decisions.
The two examples used by the noble Baroness, Lady Taylor of Stevenage, and the noble Lord, Lord Young of Cookham, relating to retirement housing and homes for life, strike me as being very important in our discussions. Those of us who have been involved in leasehold, and in the debate about leasehold and some of the criticisms of the way in which leasehold is implemented in practice, have been astonished by the way in which some retirement housing service charges have risen exponentially, without, it seems, any recourse to an explanation or a reduction. It is important to understand, for both homes for life and retirement housing—one of which is referred to in the schedule and the other which is not, as the noble Lord, Lord Young of Cookham has said—how protections will be provided for these very important areas of housing in order to provide protection for the leaseholders in these arrangements.
We support the probing amendments of the noble Baroness, Lady Taylor of Stevenage, and look forward to the detailed response, I hope, from the Minister.
The Parliamentary Under-Secretary of State, Department for Levelling Up, Housing & Communities (Baroness Scott of Bybrook) (Con)
My Lords, it gives me great pleasure to open Committee on the Leasehold and Freehold Reform Bill. Before turning to the debate on the amendments that have been tabled, it would be remiss of me if I did not take this opportunity to thank those Peers who have engaged with the Bill and those who have long championed the rights of leaseholders. I also thank colleagues from the Law Commission, without whose advice much of this vital legislation may not have been possible.
Lord Young of Cookham (Con)
I am most grateful to my noble friend for that undertaking, but I remind her that the Government said:
“We will provide an exemption”,
for these types of scheme.
Baroness Scott of Bybrook (Con)
I have noted that.
The noble Baronesses, Lady Pinnock and Lady Taylor, and the noble Lord, Lord Young of Cookham, also brought up the issue of the exempting of retirement houses. Retirement houses do not stand alone; they are usually part of a wider scheme with extensive communal facilities and packages of support care and hospitality services. A lease can help to organise the relationship between the two parties, with the home owner and provider managing the development in properties such as these. We think this justifies an exemption from the ban.
The noble Baroness, Lady Taylor Stevenage, also brought up the commencement day for this Bill. The letter that we wrote to the noble Lord, Lord Kennedy, explained that it is a complex Bill, and there will be complexities as we roll out the Bill after Royal Assent. However, I think we did put in that that commencement is likely to be 2025-26, not 2026.
I want to reassure noble Lords that there is a power in the Bill, should evidence of any abuse emerge, to tighten definitions further or remove exemptions entirely if there is evidence that a stricter approach is necessary. With these assurances in mind, I hope that the noble Baroness will agree not to press her amendment at this stage. In this group—
Baroness Pinnock (LD)
Before the Minister sits down, she referenced in the early part of her response the number of houses that were likely to be developed under circumstances where a lease had already been granted before the commencement of this Bill. Is she able to give the Committee a ballpark figure of the number of houses that would be caught up in this situation?
Baroness Scott of Bybrook (Con)
I am not prepared to give any ballpark figures from the Dispatch Box, but I will look into it and let the noble Baroness know. I apologise that I do not have that figure with me today.
Before I finish on this group, I have government Amendment 8, which makes minor clarificatory changes to the definition of shared ownership leases permitted under the leasehold house ban to clarify its intent. The amendment adds a further condition to permitted shared ownership leases, confirming that where a shared ownership leaseholder has acquired 100% of the equity in the house, they will then be transferred the freehold of the house at no extra cost. This brings the definition into line with government funding programmes and definitions elsewhere in the Bill. I look forward to hearing—
The Earl of Devon (CB)
Just to return to the National Trust exemption, are the Government satisfied that there are no other institutions similar to the National Trust that have similar obligations of heritage maintenance, will be impacted by these provisions and should also possibly be exempted? If there are, how would they be able to grant long leases on property that needs to be maintained for heritage purposes?
Baroness Scott of Bybrook (Con)
We have been working with the stakeholders for many months, if not years, on this. If the noble Earl looks in the schedule of exemptions, I think he will find everybody that wanted to be there. We have agreed to put them there, but if he has any particular group in mind, I would like to hear about it, please.
Government Amendment 8 is also relevant to the following group of amendments, so perhaps we could take that into consideration on the next group. In the meantime, I look forward to hearing from noble Lords about how they think these measures can be improved as we move through the Bill. I ask that the clause stand part and that the amendments are not moved.
Lord Khan of Burnley
Member's explanatory statement
This amendment, and other similar amendments in my name, probe each of the categories of “permitted leases”.
Lord Khan of Burnley (Lab)
My Lords, I will speak to these probing amendments in the name of my noble friend Lady Taylor of Stevenage. This group of amendments further relates to different parts of Schedule 1, which provides details of permitted lease categories where self-certification applies in relation to the Clause 1 ban on new leases of houses, which the Government added to the Bill on Report in the Commons. The purported ban on new leasehold houses does not actually ban all new leasehold houses—a point that my noble friend eloquently made during the opening group. It is imperative that, through the probing amendments in this group, we emphasise that this ban appears to be a weak ban.
Each of the amendments in this group refers to a different type of exemption or permitted lease: Amendment 5 relates to leases agreed before commencement; Amendment 6 refers to shared ownership leases; Amendment 9 relates to home finance plan leases; Amendment 10 refers to extended leases; Amendment 11 looks into agricultural leases—paragraph 9 of Schedule 1 details the permitted lease definition for agricultural leases as
“a lease where the house is comprised in … (a) an agricultural holding within the meaning of the Agricultural Holdings Act 1986 which is held under a tenancy to which that Act applies, or … (b) a farm business tenancy within the meaning of the Agricultural Tenancies Act”.
Without wishing to lengthen the debate on this issue, since many points were picked up by my noble friend, can I ask the Minister opposite to let the Committee know how many current leases fit these categories of permitted leases? Do the Government expect it to stay the same going forward, especially for shared ownership? How many permitted leases do the Minister and the Government envisage over the next 10 years, for example, to which these categories will apply?
Lord Young of Cookham (Con)
My Lords, I will speak to Amendment 7 in my name, which deals with shared ownership—one of the issues touched on by the noble Lord, Lord Khan. Shared ownership was developed in the 1980s and I claim some paternal responsibility for it. It was a route into affordable homes, and there are now some 200,000 shared owners.
There is a risk that shared owners will fall between the cracks between conventional leaseholders and those who rent. The Government are doing a lot for the conventional leaseholder. Under the Renters (Reform) Bill, they plan to do a lot for the conventional renter, and as I said, there is a risk of shared owners falling between the cracks. If one looks, for example, at the New Homes Ombudsman Service, which I greatly welcome, and the new homes quality code under it, the protection does not extend to affordable homes—namely, those sold under a shared-ownership scheme.
The reason for this amendment is a report, which I am sure my noble friend has seen, from the Select Committee in another place published on 26 March entitled Shared Ownership. The crucial thing to remember about this is that it was published after the Bill left the other place. Therefore, these are comments on the Bill as we see it today. I will briefly quote from three relevant paragraphs from that report.
Paragraph 80 states:
“When we asked Baroness Penn about this issue”—
shared ownership—
“she told us that the provisions of the Leasehold and Freehold Reform Bill are intended to make it easier for those on the old form of the lease to extend when needed. However, Shared Ownership Resources have said that shared owners will not benefit from the leasehold enfranchisement reforms included in the Bill, as, as assured tenants, they do not have statutory rights to leasehold enfranchisement”.
I hope my noble friend can assure me that shared owners do have the right referred to in that statement—the right to enfranchise—and that the fact they are technically assured tenants does not mean they are precluded from the rights in the Bill. Paragraph 92 reaffirms that point:
“We also believe that it is unacceptable that shared owners do not have the same statutory right to leasehold extension as other leaseholders”.
My final quote is from paragraph 94:
“Finally, the Government should ensure that any legislation passing through Parliament which has provisions to reduce the cost of, and simplify, the process of leasehold extension (for example, as in the Leasehold and Freehold Reform Bill) also applies to leaseholders in shared ownership properties, so that shared owners have the same statutory right to leasehold extensions as all other leaseholders”.
It is clear from those quotes from the recent report that the Select Committee holds serious doubts about the entitlement of shared owners to some of the rights in the Bill.
Shared-ownership leases are often complex. Leases on flats, for example, with multiple sub-lessees with different rights and responsibilities, can add further complexity. It is worth mentioning that shared owners are liable for all legal and other administrative costs of superior leaseholders and freeholders, although they only own, for example, 50% of the property. As a result, they can be paying more in service charges than other people in the block, simply because they have that extra relationship with the registered provider as well as the freeholder.
When a shared-ownership owner, for example, extends the lease and the property is valued, they pay 100% of the legal costs, although they only own 50% of the property. The explanatory notes to the Bill state, on page 8, paragraph 20:
“The Bill also gives shared ownership leaseholders the right to a lease extension for 990 years”.
However, the registered provider—the shared ownership’s immediate landlord—may have only a short-term interest in the lease as a head lessee or a sublessee. So, what happens when the shared-ownership leaseholder exercises the right, but the registered holder says, “I’m very sorry but I don’t have 990 years available; I only have a short lease”? Is there an obligation in the Bill for that registered provider to get a long lease, which, in turn, is passed on to the shared owner?
Turning to Condition C in the Bill, which my probing amendment addresses, I wonder whether this precludes certain shared owners from the right to a lease extension. Paragraph 6(6), on page 136, states:
“Condition C: the lease allows for the tenant’s share in the house to reach 100%”.
However, some shared-ownership leases have caps. They have caps at 80% in a designated protected area, and a cap of 75% in older persons shared ownership. So, are these groups excluded, or does paragraph 6(2) come into play, which says that the Secretary of State can exclude Condition C if the lease is of a description he has specified? Again, I would be grateful for an assurance on this.
My final point, which was also raised by the Select Committee, is that there is a broader risk of a two-tier market in shared-ownership leases following the changes in lease terms as part of the affordable homes programme.
My noble friend the Minister may want to reply to this in a letter, but shared owners want an assurance that their entitlements have been properly take on board during the Bill’s drafting, particularly against the background of the Select Committee report that I have just referred to, which makes it clear that there are anxieties that the interests of shared owners are not adequately reflected in the Bill.
Baroness Pinnock (LD)
My Lords, there are two elements of this category of permitted leases that are worthy of further exploration. One—on which the noble Lord, Lord Young of Cookham, has gone into great detail, questioning how it will work—relates to shared ownership. The second is to do with agricultural leases.
I would like the Minister to explain, first, why agricultural leases cannot be subject to tribunal certification, rather than the current self-certification process. There does not seem to be a reason why that does not occur under the first element of permitted leases.
There are other issues, such as shared ownership and self-certification, that are not necessarily covered in the details the noble Lord, Lord Young of Cookham, went into, but which are very important. I would like to understand how self-certification will be subject to challenge, what the process is and how such situations can be resolved. Will it be a costly process? If so, granting permitted leases for shared ownership, and agricultural leases, becomes an expensive legal minefield for those caught up in it.
So, I would like to understand why agricultural leases are not in the first set of certifications for permitted leases, and how challenges can be resolved. I look forward to what the Minister has to say.
Baroness Scott of Bybrook (Con)
My Lords, I thank the noble Baroness, Lady Taylor of Stevenage, for Amendments 5, 6, 9, 10 and 11. I thank the noble Lord, Lord Khan, for speaking to those amendments to Part 2 of Schedule 1. These amendments would remove exemptions to the ban on the grant of new leases on houses.
As I stated when addressing Amendments 1 to 4, the Government are aware that certain housing or financial products which support home ownership rely on granting a lease. We have therefore consulted extensively on scenarios where this may be justified. For example, shared ownership, a vital home-ownership product, relies on the use of a lease. We cannot surely be saying that the thousands of new shared ownership houses built each year should not be sold any longer. Equally, we cannot say that the use of home purchase plans—including, for example, through use of Islamic finance, a vital option for the purchase of houses for those who cannot, for faith-based reasons, apply for an interest-charging mortgage—should not be allowed, or that owners of existing leasehold houses cannot extend their leases.
For any of the exceptions in Part 2 of the schedule, including shared ownership, home finance plans, lease extensions, agricultural tenancies, or contracts on leases agreed pre commencement, it should be clear and unambiguous to consumers buying these that they are getting a lease on a house, and why that lease is needed. Because of this, the Government will not require these types of leases to obtain tribunal certification. However, again, we have taken powers in the Bill to adjust the definition if there is evidence of abuse, or to move permitted leases into Part 1 of the schedule, should there be a need for tribunal involvement. The Government will continue to monitor market behaviour and act accordingly.
The noble Lord, Lord Khan, asked for some more details of these groups of homes or products. On exempting shared ownership, I should say that shared ownership is one of the Government’s key affordable housing products, which helps consumers to get on to the property ladder. Consumers purchase shares in the property over time through the payment of rent to a provider, and a lease facilitates this arrangement between the two parties. The Bill therefore permits the grant of new shared ownership leases on houses.
When we go to financial products, the Bill includes an exemption to the ban on new leasehold houses for lease-based financial products, as I said, which can help people to buy a home or release equity from it. Here a lease is required because a third-party provider acquires a freehold on the consumer’s behalf as part of the financing of the purchase. Ownership is required by two parties and is best facilitated via a lease.
The noble Baroness, Lady Pinnock, and the noble Lord, Lord Khan, asked about agricultural tenancies. Farm businesses and agricultural landlords negotiate the length of a tenure to suit their business needs, and it is intended that this should continue, as longer-term leases can help to ensure that farmers have security to invest in their businesses over time. The Bill makes it clear that agricultural tenancies will be the permitted lease for the purposes of the ban on new leases of houses, and explicit exemption is provided in the Bill for tenancies that fall under the Agricultural Holdings Act 1986 or the Agricultural Tenancies Act 1995.
We are exempting lease extensions when a home owner extends their lease; often the original lease is surrendered and a new one granted in its place. While this is technically a new lease, the homeowner remains the leaseholder of the same property. Therefore, we believe that this should be treated as an existing rather than new lease, and warrants an exemption. In practice, we envisage that most leaseholders will purchase their freehold, where they are able to do so.
We are exempting agreements for lease. These AFLs are a contract between the prospective leaseholder and landlord to enter into a lease in the future. Where an AFL was agreed prior to commencement of the Bill, it is right that this contract should be honoured, and the lease granted. For this reason, an AFL entered into prior to the commencement of the ban will be treated as a permitted lease, as both parties have agreed on the terms of the lease and are aware that they will be entering into a lease. A tribunal certificate and a warning notice are not therefore required, we believe.
Lord Young of Cookham (Con)
I am enormously grateful for the assurances that my noble friend has given. Will the Government respond to the Select Committee report on shared ownership before Report? It raises some important issues which I touched on and it would be nice to have the Government’s response before Report.
Baroness Scott of Bybrook (Con)
I am not aware of the timescale for that, but I will make some inquiries and come back to my noble friend.
Lord Khan of Burnley (Lab)
My Lords, I thank the Minister for her response to what was a very interesting debate. I always appreciate the breadth and depth of expert knowledge from the noble Lord, Lord Young of Cookham, in particular. He talked about the rights of shareholders and what they are entitled to, and it is important that he finished by talking about the response to the Select Committee report on shared ownership. I appreciate also the probing of the noble Baroness, Lady Pinnock, alongside myself, on the definition of agricultural leases but, for the time being, I beg leave to withdraw my amendment.
Baroness Scott of Bybrook
(a) allows for the tenant to acquire the freehold of the house (if the landlord has the freehold), or(b) provides that the terms of the lease which make the lease a shared ownership lease cease to have effect (if the landlord does not have the freehold),without the payment of further consideration.”Member’s explanatory statement
This amendment amends the definition of a shared ownership lease so that it includes the case where a tenant has the right to acquire the freehold. This is in line with the definition being inserted into the LRA 1967 by paragraph 13 of Schedule 8 to the Bill.
“Report on providing leaseholders in flats with a share of the freehold(1) The Secretary of State must publish a report outlining legislative options to ensure that all qualifying tenants in newly-constructed residential properties containing two or more flats have a proportionate share of the freehold of their property.(2) The report must be laid before Parliament within three months of the commencement of this Act.”Member’s explanatory statement
This new Clause would require the Secretary of State to publish a report outlining legislative options to provide leaseholders in flats with a share of the freehold.
Baroness Taylor of Stevenage (Lab)
My Lords, just before I move my amendment, I should say that I omitted to thank the Minister for her collaborative approach to the Bill in advance of it coming before the Committee. I now do so and rectify that omission. I also thank the Law Commission, as she did, and the many groups that have a leasehold interest and met us in recent weeks. I hope the Committee will forgive me for not mentioning that earlier on.
Amendment 12 requires the Secretary of State to publish a report outlining legislative options to provide leaseholders in flats with a share of the freehold. I shall resist the temptation to go over the ground again of why the Government did not include flats in their ban on new leases, although it would be helpful to know from the Minister what level of consideration was given to enacting the recommendations of the Law Commission in full in regard to this matter, particularly as it was the stated intention of the Secretary of State—that is what he wanted to do. There has been a commitment to this ban on leasehold at least since 2017. One would think that there has been plenty of time to get the work done. Indeed, the Law Commission has done much of the heavy lifting on what would be needed.
Our later amendments seek to determine the Government’s appetite to move in due course to a more widespread system of commonhold as the default tenure. The successful adoption and implementation of this in other jurisdictions has been well debated and discussed in your Lordships’ House. It is certainly the clear intent of my party to move as quickly as possible to that tenure. However, that would be a policy decision, as distinct from the implementation of the Law Commission’s recommendations, and would necessarily have to follow the legal scheme that those recommendations would introduce. As that is not proposed in the Bill but follows the Secretary of State’s intent to do away with the archaic system of leasehold altogether, there is a strong case to make a start with a transitional regime.
The introduction of a mandatory share of freehold in all new blocks of flats, as proposed in our amendment and that of the noble Lord, Lord Bailey of Paddington, alongside the requirement to establish and operate an RMC—a right to manage company—with each leaseholder given a share, would be a sensible staging post on a path towards a commonhold future. It would make conversion to commonhold at a later date a far simpler process. We urge the Government to accept these amendments as they would ensure that we have started on the path to confining leasehold to the dustbin of history, which is where we believe it belongs, and would make it clear that the Bill is not ruling in one set of homes and home owners to the ban and ruling out another. That other is affecting by far the greatest number of leaseholders, with 70% of leaseholders occupying flats. To be clear, this is not an alternative to leasehold. If such a measure were brought into force, any leaseholder resident in a new block of flats would own both the lease and a share of the freehold. It would ensure, in effect, that all new blocks of flats were collectively enfranchised by default, without the need for leaseholders in them to go through the process of acquiring the freehold.
The advantage of having a default share in the freehold is that it would give the leaseholder a direct say on what happens in their building, as is the case with those who have already been collectively enfranchised. It would also provide additional valuable rights, such as the right to a long lease extension on the basis of a peppercorn rent; in other words, the rights that will be accorded to existing leaseholders but without the cost of paying a premium to the freeholder that is still required to exercise that modified right.
We know that flat owners having a share of the freehold can cause tensions; for example, in agreeing how to proceed on crucial decisions, such as whether to cover the cost of major works through service charges. That is why it is essential that proper management arrangements are in place as a matter of course, to reduce the likelihood of damaging disputes between neighbours. That is why we propose mandatory RMCs on new blocks of flats as a corollary to the new clause.
Labour is unequivocal about the fact that commonhold is a preferable tenure to leasehold, in that it gives the benefits of freehold ownership to the owners of flats without the burdensome shortcomings of leasehold ownership. As we have heard, the Law Commission made 121 recommendations on commonhold, designed to provide a legal scheme that would enable commonhold to work more flexibly, and in all contexts. It is vital that if commonhold is to be the default tenure, it is enacted fully and properly, with full account of the Law Commission recommendations.
We have not sought to persuade the Government to incorporate any subset of the Law Commission commonhold recommendations into the Bill, but we need to reform the legal regime for commonhold in one go. Labour is committed to doing so if the British people give us the opportunity to serve after the next general election. In the meantime, it would be good to give current leaseholders a share in the management of their properties. I beg to move.
Lord Bailey of Paddington (Con)
My Lords, it is a pleasure to follow the noble Baroness, Lady Taylor of Stevenage. I do not want to rehearse the reasons why I think that a mandatory share of the freehold is necessary, in the way that the noble Baroness laid out. I want to speak more to the contact that I have had with so many different groups and individuals who feel that they are trapped in their leasehold.
The number one thing that comes up is, of course, service charge abuse. Which? did a study in 2011 which suggested that 700 million service charges had been overcharged. The market for that has grown now to 6.7 billion, so we can only assume that this overcharging has grown along with it.
The challenge becomes: how do we make this market fair? How do we make sure that these abuses are washed away? That is to give the people paying the bills control, and not to lock them into the monopoly that leaseholders are currently locked into. Ultimately, the answer would be commonhold, but while commonhold is not on the table, we need to look at a share of the freehold. It should be mandatory, and it should happen straightaway. The noble Baroness laid out very eloquently the benefits that this would give to leaseholders.
We must understand that leaseholders do not want a landlord; that is why they have left the private rented sector—to avoid landlords. These amendments should stand. They really give leaseholders what they want. I have tabled an amendment which asks the Government to retain the power to bring forward a share of the freehold on new flats. That is the most important thing going on here.
Baroness Pinnock (LD)
My Lords, we on these Benches far prefer a move to commonhold. The journey towards commonhold is a solution to the leasehold/freehold issue.
I understand why the noble Baroness, Lady Taylor of Stevenage, and the noble Lord, Lord Bailey, have proposed a share of freehold as a route towards commonhold as being the ideal solution, as recommended by the detailed report from the Law Commission in 2020. However, it is only a small step, and it is an option that is already being exercised by some flat owners.
It seems to me that the disadvantage of share of freehold is that, in practice, it will be possible only for blocks of flats with a small number of units. Where there is a large number of units in a single block, it would be very difficult to have a share of freehold for some but not others. It will be interesting to hear what the Minister and the noble Baroness, Lady Taylor of Stevenage, think.
Baroness Scott of Bybrook (Con)
My Lords, I thank the noble Baroness, Lady Taylor of Stevenage, and my noble friend Lord Bailey of Paddington for their amendments.
Amendment 12 would require the Secretary of State to publish a report, within three months of the commencement of the Act, into the legislative options for mandating that new-build flats be sold to leaseholders with a proportionate share of the freehold. We appreciate the benefits that share-of-freehold arrangements have over ordinary leasehold arrangements with third-party landlords, which is why we are making it simpler and cheaper for leaseholders of flats to enfranchise collectively and, therefore, achieve share-of-freehold arrangements. However, the commonhold framework has already been designed as the optimal legal vehicle for the collective ownership of flats. As such, the Government want to see the widespread take-up of commonhold, and for it to be the future preferred tenure for owners of flats, rather than share of freehold.
The noble Baroness, Lady Taylor of Stevenage, asked why the legal framework was so complex. We need to determine precisely what property the mandate is applied to, exemptions, the processes for phased developments, the enforcement of developer liabilities for remedial works and so on. We would also need to prescribe the constitution for resident management companies—since they are presently unregulated—and to consider how the management functions are to be exercised by such companies, resident participation in decision-making, and the procedures and jurisdictions for dispute resolution. It is a complex issue, but one that we are working on—the Law Commission has worked on it for us for a number of years—and we feel that it is important that we continue with moving to commonhold rather than mandate share of freehold.
We understand the desire to offer leaseholders a share of freehold in the interim between leasehold and commonhold while the Government consider the Law Commission report and work on commonhold. However, we do not believe that mandating share-of-freehold sales would be a simple and quick undertaking. We also have concerns about using share of freehold across the whole housing market. It is not an optimum product for managing all types of shared properties, such as large and complex buildings—as we have heard—or buildings with extensive shared spaces. That is why the Government are committed to commonhold instead. We would prefer to work on one widespread take-up of a new tenure, and for that new tenure to be commonhold.
Baroness Taylor of Stevenage (Lab)
I will ask for some clarification, then. The policy was originally announced in 2017. The Law Commission did a great deal of work on what needed to be done to enact commonhold, and yet it is not in this Bill. The Minister has just reaffirmed the Government’s commitment to move to commonhold, so can she say how much longer it will take to get us to a situation where we have it?
Baroness Scott of Bybrook (Con)
I reiterate that the Government remain absolutely committed to widespread take-up of commonhold for flats. We have reviewed the Law Commissioners’ recommendations to reinvigorate commonhold as a workable alternative to leasehold, and I can assure noble Lords that we will set out next steps in due course.
Amendment 15B from my noble friend Lord Bailey of Paddington would require mandatory share-of-freehold arrangements to be made for block of flats in instances where flats are subject to long leases or collective enfranchisement. I thank him for this amendment and for his interest in this specific instance. We are aware of the interest in this and appreciate the desire to ensure that more leaseholders can obtain control or ownership of their building. Although we understand the benefits that share-of-freehold arrangements can have over ordinary leasehold arrangements with third-party landlords, we are also conscious that mandating share-of-freehold sales on new builds would require a complex legal framework to be constructed and to accommodate the mandate. As I have said, we do not believe that mandating share of freehold would be a quick or easy fix for leaseholders. The Government consider that the best option, as I have also said before, is to continue to work towards the widespread use of commonhold in future, rather than mandating share of freehold.
My noble friend Lord Bailey of Paddington was particularly keen on service charges. The Government will bring forward, through this Bill, a number of measures to require landlords to provide further information to leaseholders on a very proactive basis and to increase the transparency of their service charges and administration charges, as well as providing more information to leaseholders on a reactive basis. Those measures include the introduction of a standardised service charge demand form to standardise the information that freeholders are required to provide to leaseholders. We will mandate the provision of an annual report that sets out key information of importance to leaseholders. We will compel landlords to provide more relevant information to leaseholders on request. We will ensure that service charge accounts are provided within six months of the end of the previous accounting period that they cover, regardless of the lease terms, and this will be subject to a number of exemptions. We will require freeholders to proactively disclose—
Lord Bailey of Paddington (Con)
Can my noble friend the Minister let me know how many of the 121 recommendations that the Law Commission made around commonhold will be adopted?
Baroness Scott of Bybrook (Con)
All I can say to my noble friend is that that is exactly what the Government are working on and that further details will come forward in due course.
A number of things in this Bill will affect the transparency and accountability of freeholders to leaseholders, particularly on service charges, which is the one thing that my noble friend brought up. For these reasons, I hope that the noble Baroness and my noble friend will not press their amendments.
Baroness Taylor of Stevenage (Lab)
I thank all noble Lords who have taken part in the debate. I found it a bit of a frustrating debate in many ways. As I said, this policy was announced in 2017; we have had a very detailed Law Commission review and endless discussions in this House about how we move to commonhold. In a sense, my amendment was set out to probe whether we could have some route map towards commonhold, and this might be a first step towards that, to provide leaseholders with at least a share of freehold with a view to moving towards commonhold in the future. It seems that the Government want neither to set out what their route map to commonhold is or what the steps on it might be, nor to give us a timescale for that route map towards commonhold. Now we are faced with an indefinite timescale to get there and a Bill which could have enacted it but has not. I wonder how much longer we will have to wait. The seven years we have already waited is quite long enough.
It has been frustrating to unlock that but worth probing the Government’s intentions. I am grateful for the reassurance that commonhold is still the aim, but I would like to know how long it will take. However, in view of the discussions here today, I will for the moment withdraw the amendment.
Baroness Pinnock
“Commonhold and Leasehold Reform Act 2002: commonhold threshold(1) Within six months of the day on which this Act is passed the Secretary of State must make regulations to amend the Commonhold and Leasehold Reform Act 2002 to lower the threshold of supportive eligible leaseholders needed to enter into a commonhold to 50%.(2) Regulations under subsection (1) may not be made unless a draft of the instrument has been laid before and approved by a resolution of each House of Parliament.”Member’s explanatory statement
This amendment would require the Government to legislate for conversions from leasehold to commonhold where 50% of eligible leaseholders in a building support the conversion, rather than 100% as it currently stands, in line with the recommendation from the Law Commission.
Baroness Pinnock (LD)
My Lords, this amendment is on commonhold. I was pleased to hear the Minister emphasise that the Government intend to ensure that commonhold becomes the norm, although it was unfortunate that the phrase that followed was “in due course”.
This conversation about leasehold reform has been going on for a very long time. I accept that it is complex and that that there are competing financial interests. I accept that it will be difficult to find a route to ensuring that leaseholders become commonholders. However, the legal work has been done by the extensive and authoritative report from the Law Commission, The Future of Home Ownership, which was published in July 2020. The commission published three massive reports—one of them is over 800 pages. Therefore, the Government have at their disposal the combined thoughts of the Law Commission on how home ownership should be extended to leaseholders, and it has explained how that is done in a straightforward way.
The amendment in my name presses the Government to legislate for conversions to commonhold where only 50% of eligible leaseholders in a building support the conversion—rather than having it at 100%, which is obviously a barrier to commonhold ownership—and is in line with the recommendation from the Law Commission.
Everyone in the Committee will be well aware that the leasehold/freehold arrangement is very unusual in western European countries. The historic norm in the rest of western Europe is the equivalent of commonhold; that is how people who live in flats organise their affairs. It was introduced in England and Wales in 2002 but, for various reasons explained by the Law Commission, it has not taken off as an alternative to leasehold.
Baroness Fox of Buckley (Non-Afl)
My Lords, I shall speak to my Amendment 14. First, I apologise that I was away for Second Reading; I confess that I would probably have made a rather frustrated and angry speech at the Bill’s limitations and the waste of a chance to end leasehold once and for all. However, I come here today in a more conciliatory mood with, I hope, a constructive proposal to create a sunset clause on all new leasehold flats that would allow the Government five years to resolve any outstanding issues for present leaseholders. Because of a time limit, there would be light at the end of the tunnel, and all the rhetoric from the Government and the Opposition condemning leasehold as a feudal, unfair tenure could be turned into a concrete outcome, with no room for broken promises.
There is nothing unreasonable or radical about the amendment. The Conservative Party’s 2019 manifesto promised to enact a
“ban on the sale of new leasehold homes”—
and note that the wording was “homes”, not “houses”—and the majority of leasehold homes are flats. In fact, as the noble Baroness, Lady Pinnock, pointed out, 70% of them are. We know that it is precisely in relation to flats where the real abuse occurs, where the real money is made by third parties in exploitative extraction, and where the majority are denied control of their own finances and lives. That is where this scandal lies.
What is more, the number of leasehold flats is increasing exponentially, whereas the proportion of new-build houses sold as leasehold is falling dramatically, from a 15% high in 2016 to a meagre 1% of all leaseholds in December 2022. Yet the Bill avoids the main problem, and I am hoping that this amendment will give us a way out, and that now is the time to do it. Banning new leasehold houses is not enough and does not, in my opinion, despite what the Minister assured us, uphold the manifesto commitment. The amendment would allow the Government to honour their promise but without doing it in a rush.
Not to be partisan, I was delighted when the shadow Housing Minister, Matthew Pennycook, pledged to scrap leasehold tenure within Labour’s first 100 days in office, but this appears to have been slightly rescinded or fudged. This is therefore an amendment for all sides, to ensure there is cross-party consensus that we will absolutely name the date by which leasehold will have gone—what Michael Gove, the Secretary of State, has called an “indefensible” system of tenure. As far as I can see, everyone, cross-party, agrees with that. If not now, when? This is the first piece of legislation tackling leasehold tenure for new and existing homes in 22 years, outside of building safety. Another opportunity to move against this iniquitous regime may not come around any time soon; it might take another 22 years.
I am keen to learn the lessons of history, because back in 1995, the late Frank Dobson, then the shadow Secretary of State for the Environment, and Nick Raynsford, then the shadow Secretary of State for Housing, brought out an excellent pamphlet entitled An End to Feudalism: Labour’s New Leasehold Reform Programme. It noted:
“Over recent decades the weaknesses and injustices inherent in the British leasehold system have become increasingly highlighted, but reform has been a long time coming”.
It was promised that reform would come under that Government, but reform has sadly been an even longer time coming because, despite a promise to use the 2002 leasehold Bill to sunset any new leasehold buildings, this was reneged on.
This failure to use legislation 22 years ago to resolve the situation means that over 2 million further leasehold properties have been created—the very debt traps that have caused so much misery for so many. Are we just going to allow this Bill to pass, knowing that we will create more leasehold flats, and therefore more problems and more debt traps ahead? As Sebastian O’Kelly from the Leasehold Knowledge Partnership bluntly put it to MPs:
“You’re out of step with the rest of the world, so stop creating more leaseholds”.
I was delighted to hear the Minister assure us that nobody wants this, but I want that promise to be written down rather than just stated.
I stress that the amendment is not trying to dictate how this should be done. Rather, it would give the elected Government of the day, whoever that is, the space and flexibility to decide on whatever schemes are appropriate to ensure that third-party investors—the rentiers—are no longer permitted to interfere in what will be, I hope, a thriving sector of flats throughout the UK.
The amendment is not prescriptive, as I have said. Commonhold is not even mentioned directly, even though I agree with all those who have said that it is best suited to deliver ownership and management of residential flats for the future. The main point is to set a sunset clause to ensure that, whichever party is in government, there are no more broken promises and that the “in due course” we heard about earlier has an end date. What is more, the amendment, via proposed new subsection (3)(c) and (d), would ensure that existing leaseholders are not left behind. In a way, what is not to like?
However, it is difficult to know exactly who or what I am arguing against, because I am not quite sure that I even understand why this could not have been done in this legislation. The answer has not been forthcoming. I want to look at just a couple of objections.
In this Chamber, the noble Baroness, Lady Penn, explained from the Dispatch Box earlier this year that reforming leasehold for flats is “inherently more complicated” than for houses, as they required an arrangement to “facilitate management” of the buildings. Surely the “it’s complicated” defence is a red herring. There have been endless consultations and commissions, and decades-worth of academic and policy research, as we have heard from the noble Baroness, Lady Taylor of Stevenage, and as the noble Baroness, Lady Pinnock, pointed out. We have had the Law Commission, with its 121 recommendations. An expert advisory group, the Commonhold Council, was launched in May 2021 by the Government precisely to prepare home owners and the market for widespread uptake of a collective form of home ownership. So, as the former Housing Minister, Rachel Maclean, told the other place at Second Reading:
“All the work has already been done”.—[Official Report, Commons, 11/12/23; col. 676.]
For the remaining complexities, this amendment would give Parliament one more term as a reasonable timeframe to work at any outstanding issues—for example, around the complications of shared ownership, which we heard about earlier.
Baroness Jones of Moulsecoomb (GP)
My Lords, I do not have an amendment in this group, but it is almost therapeutic when your Lordships’ House is asked to consider a rare Bill such as this, where, instead of the Government seeking to do something really quite nasty, they are merely failing to do the best possible thing that they could.
The amendments in this group reveal that the Government have failed to bring in any proposals to replace leasehold ownership of residential property with commonhold ownership. It is obvious that there is a political consensus—at least on this side of the Chamber and partly on the other side—that commonhold should be the main model of ownership for multi-unit residential properties. However, 20 years since commonhold was first introduced, and four years since the Law Commission published legislative proposals to enable more widespread adoption of commonhold, it looks as though this Government have chosen to leave this issue to the next Government to sort out. That might be the best thing—I do not know—but, quite honestly, this Government have had the option, even in this Bill, to do the right thing.
Housing is part of survival: it is a human right and you have to get it right. It is time to end the commodification of housing by international finance and to end the feudal model of land ownership, which facilitates developers extracting as much money as possible from home owners while providing little or no value in return. Forgive me, I should have declared an interest as a leaseholder.
I would like to ask the Minister some questions; others have probably asked these questions before, but I just want to be specific and get clear answers. When do the Government expect the Commonhold Council to complete its work on the implementation of commonhold for new housing supply? When do they expect the completion of the work on conversion to commonhold? Why is it taking so long?
Lord Young of Cookham (Con)
My Lords, I will make a brief intervention to support the thinking behind Amendment 14, in the name of the noble Baroness, Lady Fox. We all understand the disappointment that it has not been possible to make progress with commonhold in this Parliament. We all understand that it would be impossible to try to retrofit commonhold into the existing legislation. One thing we have learned over the last two parliamentary Sessions is that the capacity of the department to produce legislation that does not need wholesale amendment as it goes through is limited. We all bear the scars of the levelling-up Bill.
We have also seen the number of government amendments that have already been tabled to this Bill. What ought to happen, and I wonder whether my noble friend would smile on this, is that at the beginning of the next Session, a draft Bill should be published on commonhold. That would enable us to iron out all the wrinkles and expedite the passage of an eventual commonhold Bill when it came forward. There is all-party agreement that we need to make progress with commonhold, so urgent work now on producing a draft Bill is time that would not be wasted. It would mean that early in the next Session of Parliament we could produce a draft Bill—we have the Law Commission’s work, which we could build on—and iron out all the wrinkles. Then, when the actual Bill came forward, we would be spared, I hope, the raft of government amendments. I exempt my noble friend on the Front Bench from responsibility for this; it would be a faster destination.
By way of comment, what has happened to draft Bills? When did we last see a draft Bill? If you look at the Cabinet Office’s recommendation, I think in 2022 it said that they should be part of a normal legislative programme; there should be a number of Bills produced in draft, which we can get our teeth into. All my experience as chairman of the Parliamentary Business and Legislation Committee is that when you have a draft Bill, the actual Bill goes through much more quickly. Again, my noble friend has no responsibility for the legislative programme, but I think we need to spend more time as a Parliament looking at draft Bills rather than at Bills that have been drafted in haste, and then having to cope with a whole range of government amendments.
The Earl of Devon (CB)
My Lords, I too was unable to speak at Second Reading, and I apologise for that. However, I was able to attend much of the debate and to listen to a number of your Lordships’ speeches. I noted the numerous times in which leasehold tenure was described as “feudal”; we have heard this many times today. It is used as a pejorative term, which I do not strictly agree with, being a feudal Member of your Lordships’ feudal House, serving our feudal sovereign. It seems a somewhat discriminatory term to use. I also note that not all feudal rights are bad; we laud the Magna Carta, the right to trial by jury, and the rights of habeas corpus, all of which are essential feudal rights. I would hazard that leasehold tenure is similarly a feudal right that we should be particularly proud of, like your Lordships’ feudal House.
That said, I realise that the days of leasehold are numbered, but we should not remove such an important element of our residential housing market without ensuring that there are at least adequate alternatives that are fit for purpose. There currently are not. I believe it a mistake to dismantle leasehold tenure without ensuring that the commonhold alternative is fit for purpose.
Here I note my interests: in 2003, as a junior property barrister, I was a contributing author to a handbook on the exciting new tenure of commonhold. Since then, and despite our best hopes, the book has sold barely a copy, and I understand that commonhold has been adopted by hardly anyone. In 2015, and again more recently, the Law Commission has explored the shortcomings of commonhold, and has, as we have heard, identified numerous ways in which the law could be amended to make it better. I believe the Government are therefore wrong not to have grasped the nettle and made commonhold fit for purpose at the same time as, if not before, introducing this piece of legislation.
For this reason, I support the probing amendment of the noble Baroness, Lady Taylor, with respect to the publication of a commonhold strategy. Without that viable alternative, I am particularly concerned that the leasehold reforms will have the unfortunate effect of decreasing the available housing stock, and will drive up the price of housing, which will decrease the number of homes that are affordable. I note my interests as a member of the Devon Housing Commission, ably chaired by the noble Lord, Lord Best, which is exploring why there is so little housing available in the county for people who actually live there.
I have a question for the Minister: have the Government sought to measure the likely impact of the Bill on the availability of new housing, and the willingness of freeholders to make land available for development?
Lord Kennedy of Southwark (Lab Co-op)
My Lords, I have a number of interests to declare: first, as a leaseholder, secondly, as chair of the Heart of Medway Housing Association and, thirdly, as a non-executive director of MHS Homes Ltd.
I spoke at Second Reading and I am sure that, as we go through these few days in Committee, we will largely agree with each other that there is a major problem. We all want to see leasehold reform and commonhold reform. Everybody backs it. I know that the noble Baroness, Lady Scott, and the noble Lord, Lord Gascoigne, back it. The problem is that we are not doing anything about it. That is the shame here.
The amendment from the noble Baroness, Lady Fox, absolutely takes us forward. She includes a day to end leasehold flats, which would deliver that Tory party manifesto commitment. We should all back her if, as I hope, she divides the House at the next stage. Her amendment would deliver the Tory party manifesto commitment, but will the Government support it? Of course not. We know that. We all agree in these debates, but what we will get from the Government Front Bench is, “When parliamentary time allows”, “The next steps will follow in due course”, “We are keeping it under review”, or “We will get back to you”. That is the problem.
This is a golden opportunity that the Government have completely failed to deal with. We have sat here for years. I have asked question after question. I have been assured, “It is coming” or “Don’t worry, don’t ask questions, we are going to sort it all out”. Yet here we are and what do we get? A Bill that delivers very little. On the point about service charges and transparency, I can assure the Government Front Bench that if a leaseholder has problems with the service charge, they know they have problems. What they want from the Government are the tools to sort them out. The Government have not delivered that. They can give more transparency—great, but we need the tools for the job and they are not doing that for us.
This is very frustrating. I think we will have lots of agreement but very little action. I hope that, when we get to Report, a number of amendments will be passed and many members of the Government will support us in delivering the commitments that their party made to leaseholders at the last general election. The amendments from the noble Baroness, Lady Fox of Buckley, in particular, are really good, giving an absolutely clear cut-off date.
My noble friend Lady Taylor of Stevenage asked the Government to set out their strategy for commonhold. What is it? I hope they can tell us. The current strategy seems to be, “We will get back to you. We know it is important, but we can’t do anything about it at the moment—sorry”. That is just not good enough. There are lots of great amendments here, but we need some action from the Government. I hope that, when we get to the next stage, we will divide the House many times. Where we have got to at the moment is just not good enough.
In 1880 Henry Broadhurst was elected as the Member of Parliament for Stoke-upon-Trent. He was then elected as a Member of Parliament for Nottingham West. He raised the problems of leasehold in the other place. We are still talking about them today. He was elected in 1880, and we have still made only limited progress. It is about time we made some progress here. We want more transparency and we want the Government to deliver their commitments. We want commonhold, and we want it now.
The Earl of Lytton (CB)
My Lords, I agree fundamentally with the point made by the noble Baroness, Lady Taylor of Stevenage, and with what other noble Lords have said with regard to the desirability of a transition to commonhold. I say that because, apart from anything else, conventional leasehold has clearly got itself an extremely bad press. Like it or not, that is something we have to take account of. However, although it is poorly regarded among leaseholders, it happens to be the commercial preference and the model on which a great deal of leaseholder and freeholder value rests. We have to be a bit careful about that.
My interest here is very much about consumer protection. I do not want us to enter a brave new world in which the existing leasehold situation is seen as in any way second class. Comments are made about the evils of monetisation of the management process, but I think that is a slightly different issue. I do not see that as intrinsic in the tenure. I see that as an abuse, a lack of transparency and another area in which consumer protection has not operated.
Lord Kennedy of Southwark (Lab Co-op)
My Lords, I forgot to mention earlier how much I support the noble Lord, Lord Young of Cookham. I think the last draft Bill we had here was the Modern Slavery Act. There was a draft Bill and a Joint Committee of both Houses on it. The work of that committee ironed out all the wrinkles; we got a much better Act of Parliament, and it had a much easier passage through both Houses. The committee was able to look at the issues and deal with them, which was really important.
It would be lovely to hear the Minister say that we will have a draft Bill for commonhold. Again, that would really help us. We could have a Joint Committee of both Houses that could take evidence and work through all the problems. Then, when we got the proper Bill, we would get it much more smoothly and easily through this House and the other House.
I suspect we will not get that, but it is the way forward. Having more draft legislation enables us to sort things out. The Law Commission has worked on the two other Bills we need. We would benefit from having draft Bill committees. It would be much easier for the Government and for everybody to get stuff through and to deal with the problems we all want to solve.
Lord Khan of Burnley (Lab)
My Lords, I thank the noble Baroness, Lady Pinnock, for introducing this group of amendments. It has been a fantastic, constructive debate, with some excellent points made across the Committee. I do not want to repeat the arguments, but I will speak particularly to the amendment in the name of my noble friend Lady Taylor of Stevenage, which many noble Lords have spoken about. I remind the Committee that this amendment would require the Government to set out a strategy for making commonhold the preferred alternative to leasehold, as recommended by the Law Commission in its report, Reinvigorating Commonhold: the Alternative to Leasehold Ownership.
The amendments in the name of the noble Lord, Lord Bailey of Paddington, and the noble Baroness, Lady Fox of Buckley, are both important. They all point towards a particular focus: that commonhold should be the future. We should help the move towards commonhold; it is overdue. The Government have had 14 years to deliver and have broken their promises to leaseholders, as mentioned by my noble friend Lord Kennedy of Southwark. Let me remind the Committee that an incoming Labour Government would be left to pick up the pieces should we have the opportunity to serve.
On these Benches, our commitment, as reiterated by my noble friend Lady Taylor of Stevenage, is to have comprehensive leasehold reform, and this has not changed. We will bring forward ambitious legislation to enact all the Law Commission’s remaining recommendations at the earliest opportunity if we are privileged enough to serve.
The important point made by my noble friend Lord Kennedy about not having a strategy is why, on these Benches, we have brought forward an amendment asking for a strategy as part of this Bill. It has been so long; commonhold was introduced in 2002 as a way of enabling the freehold ownership of flats and avoiding the shortcomings of leasehold ownership. However, fewer than 20 commonhold developments have been established since the commonhold legislation came into force. Flats in England and Wales continue to be owned, almost inevitably, on a leasehold basis.
Unlike practice in most other countries across the world, flat owners in England and Wales continue to hold leasehold interests that will expire at some point in the future, and landlords make the key decisions about the management and costs of their buildings. Commonhold enables flats to be owned on a freehold basis, so that owners’ interests can last for ever and gives decision-making powers to home owners.
The Law Commission published its final report in July 2020, in which it makes numerous recommendations that seek to make commonhold not only a workable but a preferred form of home ownership to residential leasehold. Its recommendations include measures designed to make it easier for leaseholders to convert to common- hold and gain greater control over their properties; to enable commonhold to be used for larger, mixed-use developments that accommodate not only residential properties but shops, restaurants and leisure facilities; and to allow shared ownership leases to be included within commonhold. The recommendations would give owners a greater say in how the costs of running their commonhold are met, and ensure they have sufficient funds for future repairs and emergency work. They would provide owners with flexibility to change the commonhold’s rules, while improving the protections available to those affected by the change.
I ask the Government whether they disagree with the benefits I have just outlined? If they do not, why are they not doing this? That is the fundamental question from this debate that numerous noble Lords have alluded to. There was clearly some appetite for it a few years ago, so why are they not doing this? Have the Government changed their mind or are they just not brave enough to do it?
In May 2021, the Government had even established a Commonhold Council as a partnership of industry, leaseholders and government that would prepare home owners and the market for the widespread take-up of commonhold. I ask the Minister what has happened to that council. When did it last meet and how often does it meet?
It is widely accepted that, in terms of this Bill, we will not have commonhold brought in now. However, there is still much miscommunication around commonhold in the industry. There needs to be more education and an awareness campaign. As contributions have highlighted today, commonhold is so much easier. You do not have complex laws; you talk to one another and work problems and disputes out. You have meetings and laws are prescribed so that it is easy for people to know what to do at each step of the way. There are things that could be done with commonhold in this Bill to strengthen it and pave the way to commonhold happening en masse. The amendment in the name of my noble friend Lady Taylor would help the Government ensure that there is a strategy in this Bill and fulfil their manifesto promise, as mentioned previously. I commend the amendment in the name of my noble friend, and I look forward to hearing from the Minister.
Baroness Scott of Bybrook (Con)
My Lords, Amendment 13 concerns the conversion of existing leasehold buildings to commonhold. I thank the noble Baroness, Lady Pinnock, for raising this important subject. In future, the Government would like to see widespread use of commonhold for new and existing buildings, empowering consumers to fully own, control and manage their buildings. Reforming the route through which existing leaseholders in England and Wales can convert to commonhold will be a crucial stepping stone on this path to commonhold. The Government welcome the Law Commission’s excellent work on this subject, and continue to consider its recommendations in this space.
Baroness Fox of Buckley (Non-Afl)
My Lords, I forgot to declare my interest as a leaseholder. I feel as though I might have to declare an interest to the noble Earl, Lord Devon, as a serf, or at least somebody who is rather pleased that democracy has allowed me to move from that particular interest.
In her response, the Minister said that all this change needs to be managed. In response to my amendment, she said there should not be a ban without due consideration. Fine, but this was a sunset clause in five years; it is hardly rushing it. The endless contributions that have been made suggest that this has been talked about for a very long time. The noble Lord, Lord Kennedy, made the point that we can all go back. This sort of response, saying that we need to go slowly and that it needs to be managed, makes it seem a little unclear as to what the Government are responding to. Nobody here is exactly rushing through.
Also, can I have some clarification on the idea of a danger to the supply of new homes? I was glad that the Minister responded to the noble Earl, Lord Devon, saying that there does not appear to be any evidence of that, but she said we had to be careful about a ban without due consideration. She herself said that it could damage the supply of new homes, and to be honest I think that is an unjustified threat—although not by the Minister. I keep hearing this: “If we rush this through, nobody will ever build a flat again. We have a housing crisis; what are we going to do?” I know the developers are saying that, but I was interested in the fact that Lendlease is one of those saying that this may disrupt building supply, but actually it seems to be building away and thriving, with massive developments in Australia, where it is from and where, indeed, there is a form of commonhold of which Lendlease was supportive. It is not going to stop the development of houses. We can build, build, build—just not build, build, build leaseholds, surely.
Baroness Scott of Bybrook (Con)
My response to the noble Earl, Lord Devon, was a response on commonhold. My response to the noble Baroness, Lady Fox, was more about the fact that her amendment would just ban the sale of leasehold, which I suggest would give an uncertainty to the market.
Lord Bailey of Paddington (Con)
Maybe my noble friend the Minister can give us some detail on the Government’s new-found support for commonhold. It would be easier not to move my amendment if I had some idea of the progress of the Government’s thinking, the timetable and how they intend to increase the adoption of commonhold, because that would make my amendment largely unnecessary.
Baroness Scott of Bybrook (Con)
I thank my noble friend for that. As I have said, we are working on it, we are working on further changes and we will come back in due course.
Lord Khan of Burnley (Lab)
If I can just probe the Minister on the answer she gave me, that the Commonhold Council met in September, can I just confirm that she is chairing that Commonhold Council? The government website still has the noble Lord, Lord Greenhalgh. As the Commonhold Council advises the Government, what advice did it give in relation to the plan for commonhold? Surely it was not, “Take your time”, was it?
Baroness Scott of Bybrook (Con)
I do not have that detail with me, but I will make sure the noble Lord gets it.
Lord Kennedy of Southwark (Lab Co-op)
Can the Minister tell the Committee whether the Government have a strategy for commonhold?
Baroness Scott of Bybrook (Con)
Yes. The noble Lord knows, and I have said it enough times at this Dispatch Box, that the Government fully support commonhold. It is a matter of getting through the complexities and ensuring that it is delivered in a safe, secure way for the future.
Lord Kennedy of Southwark (Lab Co-op)
It is good to hear that they have a strategy; maybe the Minister can explain to the Committee what the strategy is. All I see at the moment is that there is a lot of support for commonhold—everyone is committed to it and wants to bring it in in due course—but I would like to see some sort of timeline. When are we going to get it? They will have had this report from the Law Commission for four years in July. Where is the plan? If they had a plan they could set out for the Committee, I am sure they would get a lot of support from us here, but the worry is that we will be sitting here in another four years. What is the plan from the Government?
Lord Kennedy of Southwark (Lab Co-op)
I am sorry, but I asked a couple of questions there and I am hoping for a response.
Baroness Scott of Bybrook (Con)
I am sorry, but I have made it very clear that the Government are fully in support. I am trying to remember whether it was 219 or 120, but large numbers of amendments were required to be put into place to ensure that, while we have commonhold in this country now, it can be delivered across all our leasehold flats. We do not have the time on this Bill to do that amount of legal work, and that is why we are not promising it at present, but we want to get as far along that journey to commonhold as we possibly can within the Bill.
Lord Kennedy of Southwark (Lab Co-op)
But we are not, are we? That is the whole point. We are not getting anywhere, just making commitments and promises with no timescale, no plan, nothing. That is the problem and why we are getting so frustrated here. They have had the Law Commission report for four years. What have they been doing for the last four years?
Baroness Scott of Bybrook (Con)
Working on getting towards commonhold, which is what the Government want for this sector.
Lord Kennedy of Southwark (Lab Co-op)
The noble Baroness will obviously know this really well, then: how many more years do we need before we get a Bill to deliver this?
Baroness Scott of Bybrook (Con)
I do not think I have anything further to add.
Baroness Pinnock (LD)
My Lords, the purpose of Amendment 13 in my name was to encourage a debate on commonhold and the route to achieving it, and in that it has been successful. I am pleased about that and thank all noble Lords for their involvement. It has been a long time since the first legislative proposal was made to abolish leasehold. I think it was in the Liberal Government of 1906, so we are going back a long way.
Baroness Pinnock (LD)
I do not think that that was a legislative proposal—I was very careful in the words I used. What this debate has achieved is that it is very clear across the Committee that there is overwhelming support for the move to commonhold. That is very positive. The next achievement is that it has brought forward three different ways, or perhaps four, in which the Government can move. One is a draft Bill, which seems to me to be a very interesting proposal and one that again I think would get support across the House, because the move to commonhold is complex. I and everybody else who has spoken accept that, so let us find a way of working together to achieve that common end.
The second proposal was a “Let’s get something done” type of proposal for a sunset clause. If nothing else happens, let us adopt that. The third proposal, from the noble Baroness, Lady Taylor of Stevenage, was similar to a draft Bill: to get the Government to agree a draft strategy. Unfortunately, the Minister used the phrase “in due course” a number of times. The trouble with “in due course” is that the due course can go on for a very long time, as it has already. Some of us are concerned to enable all existing leaseholders to achieve commonhold and be part of home ownership. The party opposite always talks about that, so you would think it is in its interest to push it. That is why it is very disappointing to hear the Minister say “in due course” and, “We are considering the recommendations of the Law Commission”, which was four years ago now.
Finally, we have heard from various Members on the Labour Benches that, if they ever have the privilege to serve—that is the phrase they are using—this will happen quickly. I look forward to maybe 2025 when we might see whether the Minister will bring forward a proposal for a draft Bill on commonhold or whether somebody from the Labour Benches will do so, in which case we will make progress. We on these Benches will hold both parties to account if they fail to do that at the earliest possible moment. I beg leave to withdraw the amendment.
Baroness Scott of Bybrook
“(ca) in section 23 (agreements excluding or modifying rights of tenant), in subsection (2)(b), omit the words from “or any provision” to “or any part of it”;”Member's explanatory statement
This amendment would prevent a landlord and tenant agreeing to a restriction on the tenant making a repeated enfranchisement or extension claim.
Baroness Scott of Bybrook (Con)
My Lords, to be clear, the Bill already removes the automatic 12-month bar on leaseholders that stops them making another enfranchisement claim, should an earlier claim have been withdrawn. My Amendment 16 supplements this by removing the right for a voluntary 12-month agreement to be made between parties to restrict further enfranchisement claims for a leasehold house. Removing the ability for a voluntary 12-month restriction makes sure leaseholders are not put under undue pressure to withhold their claims. This is an important protection for leaseholders and makes it clear that they can make fresh claims as needed.
I look forward to hearing from noble Lords as to how they think that our enfranchisement reforms can be further improved. I beg to move.
Baroness Taylor of Stevenage (Lab)
My Lords, our Amendment 17 would enable the Secretary of State—or, in Wales, Welsh Ministers—to change the description of premises that are excluded from collective enfranchisement rights. Such a change would be subject to the affirmative resolution procedure. I thank the noble Lord, Lord Thurlow, for all his time in discussing the Bill with me, and I acknowledge his expertise in this area.
Clause 28, which our amendment targets, makes changes to the non-residential limit for collective enfranchisement claims. At present, Section 4(1) of the 1993 Act excludes from the right to enfranchise buildings in which 25 % or more of the internal floor area, excluding the common parts, can be occupied or are intended to be occupied for non-residential use. The clause increases that non-residential use percentage to 50%. We welcome the change, which enacts recommendation 38 of the Law Commission’s final report on leasehold enfranchisement and was supported by the National Leasehold Campaign, among others.
Of course, if the purpose of the non-residential limit is to confine enfranchisement to predominantly residential blocks, the Law Commission determined that the existing 25% limit does not achieve that purpose. There is a significant amount of evidence that, instead, it regularly prevents leaseholders from undertaking collective freehold acquisitions because a sizeable proportion of buildings fall slightly above it and that 25% is a significant bar to the ability of leaseholders to undertake a collective freehold acquisition. The Law Commission further argued that
“the arbitrary nature of the limit makes the bar to enfranchisement a source of considerable frustration for many leaseholders”.
We accept that there is no easy or non-arbitrary way in which to determine where that bar should be. However, it is the stated intention of the Bill to bring as many leaseholders as possible into enfranchisement, and it is therefore questionable as to whether limits under 50% would feel inherently fair. We would hope that a 50% non-residential limit would mean that the number of genuine cases excluded would be small and would remove the opportunity for developers to play the system, because only a genuine split between commercial and residential would apply.
Our main concern on this clause is that there is no flexibility built into it, and we are keen to probe whether a review after a period of time to determine whether the non-residential policy as set out is working in practice could be undertaken, or another mechanism used, so that changes for the limit in respect of collective enfranchisement rights do not require primary legislation but can be enacted through regulations. Enacting small but necessary changes that may occur in relation to the Government’s proposed limit—for example, whether that relates to individual cases that fall just above the limit, or a change in the criteria on using internal floor area to determine the rights, or changing altogether the criteria on which the limit is based—may need alternative mechanisms to resorting to future primary legislation. That is the purpose of our amendment.
I will comment briefly on the other amendments in this group. We understand the reasons for the amendments of the noble Lords, Lord Sandhurst and Lord Thurlow, and look forward to hearing the comments of the Minister on those amendments. In relation to the Question on whether the clause should stand part of the Bill, to be put by the right reverend Prelate the Bishop of Manchester, we understand the Church position as a landholder, but we feel it would go against the spirit of increasing the enfranchisement through the Bill to retain the 25% limit.
Lord Sandhurst (Con)
My Lords, I shall speak to Amendment 17A. I am sorry that I was unable to speak at Second Reading. I should also say that the noble Baroness, Lady Deech, who is unavoidably detained, has added her name to that amendment. We therefore have her support as well. Amendment 17A is directed at Clause 28 on mixed-use premises with substantial proportions of business and residential tenants. Currently, collective enfranchisement and lease renewal is not permitted where more than 25% of the premises are business premises. That figure is going to be changed to 50%, thereby making it easier for residential tenants to go down the collective enfranchisement route.
That will introduce management issues—I do not say that they are necessarily problems, but they are certainly management issues. The Bill proposes that, if 50% of the occupants are residential, that will be enough. That will mean that, unless more than half of the building is occupied by business premises, all residential tenants will be entitled to be enfranchised. That will create issues for management and, in particular, problems where some of those residential tenants are overseas companies. We know that there are increasing numbers of those, particularly in London.
Mixed-use buildings pose greater management challenges than purely residential ones. Freeholders need to be responsive and active property managers. Business tenants require swift responses so that they can manage their businesses. If they want changes to the premises and so on, they need their landlord’s consent so that they can go ahead. If there are difficulties with obtaining that consent because, for example, some—or possibly a large number—of the residential tenants are overseas companies, then one can see how unattractive such premises will become as business premises for the business occupiers.
The Lord Bishop of Derby
My Lords, I will speak in support of my right reverend friend the Bishop of Manchester, who is unable to be in his place today and who has asked me to speak to his opposition that Clause 28 stand part of the Bill. This is linked to a similar stand-part debate, in the name of my right reverend friend, relating to Clause 47, to be debated later in Committee.
I declare my interest as a beneficiary, as is my diocese, of the Church Commissioners. I thank the Minister for her engagement with the charities affected by the legislation so far: the Church Commissioners, John Lyon’s Charity, Portal Trust, Campden Charities, Merchant Taylors’ Boone’s Charity, Dulwich Estate and the London Diocesan Fund. I hope she will continue to engage with my right reverend friend to find an amicable solution.
The Church Commissioners for England are the freeholders of the Hyde Park Estate. If we are looking back a long way, the Church can look back longer than most. The Church has had a long relationship with that part of London, starting in 1550 when the Bishop of London was granted the manor. The first leases were granted in 1795, and the Ecclesiastical Commissioners became responsible for the estate in 1868. Like the other charities mentioned, the Church Commissioners have long relationships with their estate. The money generated from the estate beyond the local is used for the betterment of the whole of our society, by the levelling up of communities and the lowest income parishes across the country, including in the diocese of Derby.
Like the other charity freeholders of large estates, the Church Commissioners manage the whole area, focusing not only on the residential properties themselves but on the whole environment, for those who live in, work on and visit the area. Their freehold ownership includes approximately 100 commercial units on the estate, where independent cafés, specialist boutiques and restaurants are mixed alongside amenities for local residents. This by no means affects the Church Commissioners alone; other large freeholders across London and beyond use their mixed freeholdings to ensure that areas have what local residents need, such as a dry cleaners, a pub, a hardware store—I could go on.
I thank the Minister for her letter to my right reverend friend the Bishop of Manchester, received today. However, concerns remain that Clause 28 threatens the ability of freeholders in large estate areas to ensure mixed areas that have all the amenities that people need. If the threshold for collective enfranchisement and the right to manage claims is lowered so that more mixed blocks can initiate a claim, there is a risk of the degeneration of these areas. There is no guarantee that newly enfranchised blocks will have the wherewithal or even the desire to maintain the make-up of the estate area. Leaseholders may not even live permanently in the area, may be foreign-owned companies or may have no active stake in the community. What need would these companies or corporations have to ensure the maintenance of a community? My right reverend friend the Bishop of Manchester said at Second Reading of this Bill that:
“We would lose all the shops that really matter to those who live perhaps not just in that block, but”—[Official Report, 27/3/24; col. 737.]
in the locality.
The amendment of the noble Lord, Lord Thurlow, which would mean that right to manage and collective enfranchisement rule changes would apply only where 50% of the leaseholders are permanent residents in a block, would certainly be a step in the right direction. At least there would be a guarantee that those managing mixed blocks would have an active stake in maintaining community resources, including shops. Could the Minister tell us whether the Government could make proposals to ensure that great estate areas, such as the Hyde Park Estate and others, are not adversely affected? Nobody wants to see local shops, amenities and community hubs closing as an unintended consequence of the Bill.
Lord Thurlow (CB)
My Lords, I turn to my Amendment 18 in this group. I begin by declaring my interests as both the owner of two buy-to-let investment flats and the occupier of a flat, all on leases. I stand to benefit under the Bill in both situations, which is quite patently wrong.
I thank the right reverend Prelate the Bishop of Derby for articulating my amendment with greater ability than I can. I want to turn specifically to mixed-use buildings and the proposal to move from a 25% threshold for enfranchisement to 50%, and build on the comments of the noble Lord, Lord Sandhurst. Mine is a straightforward proposal: simply that lessees who are not occupiers living there as their primary residence should not benefit from the great wealth transfer that is going to take place through the enfranchisement process. It cannot be an intended consequence of the Bill.
My amendment requires that at least 50% of leaseholders should satisfy the residence occupancy condition for any collective enfranchisement to apply. I remind the Committee that I am thinking of mixed-use buildings. A very complex management expertise is required in looking after mixed-use buildings; the skills are not the same for commercial property as for residential property, and the scope for mistakes and delay is huge. The potential to improve and curate an environment through single ownership of an expansive area has been very clearly described. To expect such behaviour to continue responsibly is almost impossible under the Bill as it stands.
We have also heard that, in London and the south-east, some 50% of tenants are not residents but foreign nationals living elsewhere, with ownership registered abroad. Are they taxpayers? This group often do not want to be identified. They shroud their property in ownership interests in offshore companies, as we have heard. They are very slow to respond, doing so from time to time, let alone to offer up money when required. If the Government do not agree that 50% of leaseholders in a block should be permanent residents, can I have an informed estimate on how many billions of pounds is expected to be paid in compensation to this cohort of wealthy foreign nationals, should they pursue this new enfranchisement entitlement?
Lord Truscott (Non-Afl)
My Lords, I declare an interest as a long-standing leaseholder of some 30 years. I have been a leaseholder in apartment blocks in London, Kent and Somerset, and a right-to-manage director in two apartment blocks.
I support His Majesty’s Government’s Clause 28, which seeks to raise the non- residential limit on collective enfranchisement claims from 25% to 50%, as mentioned by the noble Baroness, Lady Taylor of Stevenage. I consequentially oppose the proposal of the right reverend Prelate the Bishop of Manchester and the noble Lord, Lord Moylan, to vote against Clause 28.
Your Lordships have heard how giving more say to leaseholders in mixed blocks of residential and commercial units would be a bad idea and negatively impact on investment and the effective running of these blocks. It has been said that reform would only help some foreign leaseholders and investors and would result in fewer homes being built. That is far from the case. I have lived in two blocks of mixed developments: one was controlled by a residents’ right-to-manage company, with a NatWest bank in the basement, and another contained a number of commercial units and was 100% controlled by the freeholder. I can say categorically that the right-to-manage block was run better and with cheaper service charges. The freeholder-run block exploited the residents, cross-subsidising the commercial units at their expense and giving them no effective say over how the block was run. I point out to the noble Earl, Lord Lytton, that the difference was that the RTM block was actually run by the residents, who were managing their own money, whereas the freeholder block was run by a managing company and the freeholders were profligate with the use of residents’ cash.
Let us be frank: maintaining the 25% cap is about the freeholders retaining control and not about fairness or efficiency. If anyone lives or invests in a flat in a block, they should have a say over how it is run. For that reason, I oppose the amendments in the names of the noble Lords, Lord Thurlow and Lord Sandhurst, which would restrict enfranchisement and further strengthen the position of freeholders by limiting the number of leaseholders who can vote on and manage their own blocks of residents. RTM directors are perfectly capable of managing mixed blocks of developments.
The Earl of Lytton (CB)
My Lords, I will speak to this group, as the noble Lord, Lord Truscott, mentioned my name, although I have not yet spoken. He represents one viewpoint and the noble Lords, Lord Thurlow and Lord Sandhurst, and the right reverend Prelate the Bishop of Manchester represent another. They are often portrayed as being mutually exclusive but, in property terms, that is not necessarily the case. Clearly, there are perfectly good managers who look after not only their residential tenants but their commercial tenants, and there are some are rotten managers. Some are good corporates while others are rotten—some are good resident management operations while others are pretty poor—so it is very difficult to make a standard rule for them all.
If one looks at the large urban estates across London, it is evident that there is a clear sense of purpose in trying to preserve the value, appearance and general amenity represented by the running of that estate. That inevitably comes at a cost, but I hope that that helps not only the commercial activities but the amenity of the residents.
Let us look at what happens if things start going wrong and getting fragmented. First, there becomes a distinction, if one is not very careful, between the purposes of long-term management in the view of the residents and the purposes of long-term management in the view of the commercial operator or landlord. Under the purposes of this Bill, if the enfranchisement of a 50% commercial ownership block goes ahead, there will be an enforced leaseback to the original freehold owner. Straightaway, you have an enforced leaseholder, whose business model was not quite hypothecated on that basis, who is none the less obliged to take it on but does not need to have the primary amenity and visual appeal functions that might be relevant to the residents.
I have seen that happen in historic high streets, where ownership has become fragmented in this way. We tend to find that when a shop becomes vacant, and if there are difficulties in the letting market, it will be let to a charity shop, a slot machine operator, a tanning shop, or some other type of operator, because the person who has it needs to move it on quickly. There is not that fat on the bone associated with having the larger estate, nor is there the fat on the bone to take on some assignee, as I have had to deal with in the past, who really runs a rather low-grade sort of business but is well funded. Therefore, you have to work out whether you can afford to fight an appeal, or fight a case, on an assignment of a lease in order to see off that person and their particular trade. If you cannot, there is a general deterioration of the area. It might be a fast-food takeaway that opens late at night; the police might be around every now and again; there might be people congregating there because it is late at night, and that sort of thing affects residents. If one is not careful, things like emptying bins and delivery of incoming goods to a retail operation can start being operated at times that are not that helpful to the interest of residents, who once might have been part of this overall concern. I can see both sides of this, and we have to be careful not to make standard rules about things where the decision is much more nuanced and difficult. It really depends on where one is starting from, the circumstances, and everything else.
As I said earlier, my interest is in consumer protection. I do not want to see degraded environments; I want to see environments that are lively and looked after and where everybody has confidence in them being managed. Fragmented management very seldom achieves that. The issue is about management being a slightly different issue to ownership. It is a big issue that we need to address, because it will not be dealt with by a local authority. That has no function there. Beyond the planning functions of a change of use, or licensing for some premises that needs it, it has very few powers of control. If overarching control is needed, and there may be an argument that ecclesiastical, heritage or possibly other environments do need it, we should very careful that we are not chucking out that baby with the bathwater and ending up with a slow process of attrition that suits nobody and ends up degrading the value not only of the freeholders, who can look after themselves by and large, but of the area and its appeal, which is ultimately to the detriment of residents. I do not want to go down that road without being clear about what we are doing, and making sure that there is some way we can pick up on processes of deterioration before they take root.
Baroness Thornhill (LD)
My Lords, this is my first intervention today—I spoke at Second Reading. I regret that this is yet another Bill that was heralded with robust rhetoric from the Secretary of State which has now come face to face with reality. I regret that some of that reality is from those with vested interests and therefore we are getting a watered-down Bill. We certainly believe on these Benches that it is a missed opportunity.
I turn to the group of amendments on enfranchisement. We on these Benches support the Government in Amendment 16. We need to see as many restrictions as possible on leaseholders’ ability to enfranchise removed by the Bill. After all, they have bought a home and should be able to extend their lease and buy their freeholds in a way that is easy and affordable, to use the Government’s own words.
It is perhaps no surprise that we also support Amendment 17 in the name of the noble Baroness, Lady Taylor, in so far as it would allow the Secretary of State to give more leaseholders rights to collective enfranchisement, and we note the detail of the noble Baroness’s reasons. However, the power cannot and must not be used to narrow the qualifying criteria or to exclude more leaseholders from freehold purchase. We are pleased that it would be subject to the affirmative resolution procedure, as this includes public consultation and the involvement of both Houses.
However, we know that cohorts of leaseholders will still not even qualify to buy their freehold under the Bill. For example, MPs in the Public Bill Committee in January heard from experts and campaigners that there really is a problem with leaseholders in mixed-use buildings—from our debate today, I would say we have a problem with mixed-use buildings that needs to be sorted out. The Government are admirably using the Bill to try to liberate leaseholders in mixed-use blocks by, as we have said, moving the 25% rule on non-residential premises to 50% and introducing mandatory leasebacks on commercial space to slash the cost of collective enfranchisement, but—and I find this strange—they have not lifted the restrictive regulations in the 1993 Act that mean that shared services, such as a plant room, would disqualify leaseholders from buying out their freehold. Apparently, there is even a regulation stipulating that the mere existence of pipes, cables or other fixed installations connecting residential and commercial premises in a mixed-use building would block leaseholders from buying their freedom. That means that many leaseholders who would otherwise stand to benefit from the changes on mixed use will be blocked from securing collective enfranchisement and being in control of their buildings. I ask the Minister whether we can discuss this aspect before Report.
Turning to what I will call the three “tricky” amendments, I noted that the noble Baroness, Lady Taylor, wisely hedged her bets on these. I suspect that it is because, like me, she knows that the intentions of the noble Lords speaking on them are based on good experience and a genuine wish to see the measures agreed, but she worries whether, in fact, they are just another means of putting commercial interests before residential interests and not getting that balance right.
Instinctively, like the noble Lord, Lord Truscott—I was relieved when he made his comments—we oppose these three amendments, because in our view they seek to row back. But I have listened attentively to what has been said and I am completely changing what I was going to say: I genuinely believe that there are some serious areas that need looking at. There is much experience in the Committee, but I am concerned that we have been subject to special pleadings.
Baroness Fox of Buckley (Non-Afl)
My Lords, the descriptions that have been put forward—the right reverend Prelate described these thriving communities, which sounded idyllic, and the noble Earl, Lord Lytton, talked about making sure that we understood that there might be some bad players but that there are also some very enlightened players—made it sound as though this is really just a question of having the right people in charge, whereas I think it is a systemic problem.
One of the reasons why I am anxious about this is that although it is always nicer to have friendly, non-rip-off freeholders—that is genuinely a positive thing—we should not be grateful that we are not being ripped off in the homes that we live in. The system problem is that people lack autonomy and control over where they live and their destiny. I just throw in that a successful community depends on people retaining their autonomy rather than being grateful that they are being looked after.
What the noble Baroness, Lady Thornhill, pointed out is incredibly important; the noble Lord, Lord Truscott, also made an excellent speech laying some of this out. There are thriving communities with mixed-use abilities all over the world that do not use leasehold. We are now getting to a point where we are saying, “If we don’t have leasehold here, we’ll never have a local swimming pool and there will be no community centres. What will happen to all the shops?” That is mythological. Although I agree that one needs to look at the complexities, and I for one am actually all for nuance in relation to this and not just blunderbussing away, we should also stop myth-building about the wonders of the system, when in fact the reason why we want enfranchisement in the first place is that when our citizens buy a house they should have control over it. It is their home, and they can work collectively on building the community. At the moment they are denied that, which is why we are trying to tackle the problem of leasehold in the first instance.
Baroness Scott of Bybrook (Con)
My Lords, I thank all noble Lords for their contributions, and I start by thanking especially the noble Baroness, Lady Taylor of Stevenage, for Amendment 17, which seeks to amend the description of premises that are excluded from collective enfranchisement rights, where leaseholders would otherwise qualify. I know the amendment is well intentioned, with the aim that there is flexibility to amend the description of exceptions without new primary legislation. The amendment introduces a broad power for Ministers to change fundamental elements of the structure of the regime, which are substantive areas of policy. The Government are already making changes to primary legislation by increasing the non-residential limit from 25% to 50%, following extensive consultation, which is right and proper. The powers in this amendment would affect the very core of the regime and how it is structured rather than amending mere procedural changes.
To make sure that stakeholders have certainty as to how the law will work in practice, changes to the fundamental structure of the statutory regime should be clear and stable. Although the intention behind the amendment is noble, the Government are not able to accept it as it is not proportionate or reasonable for the proper functioning of the regime. It would be a sweeping power to change the fundamental structure of the enfranchisement regime after it has been approved by Parliament.
This amendment would introduce uncertainty into the new system, meaning that both leaseholders and landlords would need to second-guess whether changes may be made at relatively short notice, introducing volatility to the regime. This could potentially lead to undesirable outcomes, such as undermining confidence in long-term investment decisions for mixed use-premises, or lead to irregular design of floor-space in anticipation of future changes. I want to make it clear that the Law Commission has spent years considering qualifying criteria and assessed different options in its consultation process before putting forward its recommendations to increase the non-residential threshold to 50%.
The amendment could also remove rights of leaseholders or landlords in a disproportionate way and create unnecessary uncertainty and divergence likely to complicate the overall regime, with consequential effects on the behaviour of different stakeholders in different ways. Therefore, I hope that I have convinced the noble Baroness that the amendment is not proportionate, and that it is not moved.
I thank my noble friend Lord Sandhurst for Amendment 17A, which would exclude long leases held by overseas companies from being qualifying tenants for the purpose of collective enfranchisement. The Government’s aim is to improve leasehold as a tenure and address the historic imbalance of power between freeholders and leaseholders. The Bill does not confer different rights on leaseholders by how their leases are held. The Government do not think that implementing such a definition, in respect of which leaseholders have rights and which do not, is workable or desirable.
Amending the definition of a qualifying tenant for collective enfranchisement will make it harder for other leaseholders in a building to meet the numbers required to enfranchise, should they so wish. Attempting to restrict some leaseholders may well disenfranchise others, meaning that many leaseholders up and down the country could lose the opportunity to exercise their rights. Furthermore, it would remove the existing rights of some leaseholders and complicate the system overall, contrary to the aims of the Government.
I understand that the intention of the amendment may be to safeguard against circumstances in which non-resident or overseas companies do not take an active interest in the management of a building or are slow to respond. However, we expect that most multi-occupancy buildings will be managed by professional management companies on behalf of freeholders, as they are now.
I thank my noble friend again for the amendment, but I cannot accept it because it runs contrary to the aims of the Government and may restrict leaseholders’ rights. I therefore hope that he is content not to move his amendment.
I thank the right reverend Prelate the Bishop of Derby for speaking on behalf of the right reverend Prelate the Bishop of Manchester, with whom I have had a number of meetings about this issue. I am happy if the right reverend Prelate takes back the fact that I will continue that discussion if the right reverend Prelate the Bishop of Manchester so wishes.
I thank my noble friend Lord Moylan for his clause stand part notice. Clause 28 increases the non-residential limit for the collective enfranchisement claims to proceed in mixed-use buildings from 25% to 50%. The clause implements a Law Commission recommendation that has been subject to comprehensive consultation by the Law Commission and the department. I note the right reverend Prelate’s and my noble friend’s concerns, which have been raised through various consultations with freeholders and landlords.
The Bill’s impact assessment considers the impact of increasing the non-residential limit for collective enfranchisement claims, including the potential impact on freeholders, high streets and businesses. The increase to 50% strikes a fair and proportionate balance and will ensure that leaseholders are not unfairly prevented from claiming the right to manage in respect to buildings that are majority residential. It protects the freeholders and commercial leaseholders in buildings that are majority commercial. Freeholders can also protect their commercial interests by taking a leaseback of the commercial unit, securing their interest with a 999-year leaseback at a peppercorn rent.
We recognise the importance of the responsibility of building management and, as I have said, would expect that those who exercise their right to take over their buildings will employ professional managing agents—ensuring that the building is managed with the appropriate expertise, as we have heard from the noble Lord, Lord Truscott, about the issues that he is aware of.
The Government consider that this increase is proportionate, and I ask the right reverend Prelate and my noble friend to support Clause 28 standing part of the Bill.
I thank the noble Lord, Lord Thurlow, for Amendment 18, which seeks to apply a residency test to the collective enfranchisement claims in buildings with more than 25% non-residential floorspace. As we have discussed, Clause 28 amends the Leasehold Reform, Housing and Urban Development Act 1993 to increase the non-residential limit for collective enfranchisement claims from 25% to 50%.
Clause 28 implements a Law Commission recommendation that seeks to broaden access to collective enfranchisement for leaseholders living in mixed-use buildings where the non-residential elements constitute up to 50% of the floorspace. The existing qualifying criteria require leaseholders representing at least 50% of the flats in a building to participate in a collective enfranchisement claim. When combined with these existing criteria, the noble Lord’s amendment would allow claims only in mixed-use buildings with more than 25% non-residential floorspace, where at least 25% of the flats are owner-occupied.
For leaseholders in mixed-use buildings where less than 25% of the flats are owner-occupied but more than 25% of the floorspace is non-residential, this new clause would have the effect of removing all the benefit of Clause 28. This would leave leaseholders unable to collectively buy the freehold of their building because of how their neighbours chose to use their properties. It would also complicate all claims in buildings with over 25% non-residential floorspace, as participating leaseholders would be required to demonstrate that they are owner-occupiers. This could lead to claims taking longer and costing more, and would provide freeholders with another opportunity to frustrate leaseholders’ right to buy their freehold. This is counter to the Government’s aims in this area to broaden access to collective freehold ownership for all leaseholders, and to simplify, not complicate, the system leaseholders use to do so.
Lord Gascoigne
“(ea) any combined county authority established under section 9(1) of the Levelling-up and Regeneration Act 2023;”Member’s explanatory statement
This amendment would reflect provision that has come into force since the Bill was introduced.
Lord Gascoigne (Con)
My Lords, before I start, I declare that my wife is an employee at the Crown Estate, as set out in the register of ministerial interests.
Government Amendments 19 to 22, in the name of my noble friend Lady Scott, are consequential on the repeal of the right for public authorities to block freehold acquisition and lease extension claims of houses for the purposes of redevelopment. This relates to Section 28 of the Leasehold Reform Act 1967. Removing this blocker will allow more leaseholders to enfranchise.
The power to block enfranchisement was given to authorities named on a list in the same section of the Act. The list of authorities is, however, used for wider purposes. For example, the list may be used by separate legislation when a lease has reached its end and expired. When this happens, the listed public authorities could apply to the courts to seek possession, for the purposes of redevelopment. These amendments preserve the list and its use for wider current law, as it is moved into Clauses 29 and 38 of the Bill.
Government Amendments 25, 30 to 40, and 49 are also in the name of my noble friend Lady Scott. Government Amendment 32 addresses the enfranchisement valuation procedure regarding “chained” leases—that is where successive long leases of a house are treated as one single long lease. The amendment makes it clear that the exception for market rack-rent leases will apply only where the leaseholder’s current lease is a market rack-rent lease. It will not matter whether a previous lease was a market rent lease. This will protect leaseholders and mean that in the case of chained leases, where a previous lease might have been granted for no, or low, premium, freeholders will be prevented from unfairly gaining through the new valuation scheme.
Government Amendment 39 clarifies the rules on which lease to consider when valuing a lease comprising a chain of leases—treated as one single lease—where one of them was granted for a high rent and low, or no, premium. The amendment states that it is the most recent lease that should be looked at. This will determine whether the ground rent cap should apply in the enfranchisement valuation. This will protect leaseholders and mean that in the case of chained leases, where a previous lease might have been granted for a high ground rent, but for little or no premium, freeholders will be prevented from unfairly gaining through the new valuation scheme.
Government Amendments 25, 31, 33, 34, 35, 36, 37, 38 and 40 are minor amendments that will tidy up the Bill by aligning two different sets of terminology, used to mean the same thing, across the Bill. This will help to avoid any potential for confusion and has no material impact on the valuation provisions in the Bill.
Government Amendment 30 is a minor amendment to Schedule 4. As currently drafted, the Bill would incorrectly require a valuation of a freehold for a lease extension. We are fixing this to align with the new valuation scheme, so that a lease extension will require a valuation of a notional lease. This will ensure that the provision works for lease extensions as intended. This amendment does not change the scope or effect of Assumption 3 in Schedule 4; it simply makes sure that it is phrased correctly.
Government Amendment 49 is a minor correction of a grammatical error in Clause 41 so that it refers to the appropriate tribunal. In this case, the appropriate tribunal can make orders regarding the new right for intermediate landlords to commute—that is, reduce—the rent they pay following lease extensions and ground rent buyout claims by their tenants.
Turning to government Amendments 50, 51, 52, 53 and 56 in the name of my noble friend Lady Scott, as noble Lords are aware, whenever making new legislation, it is of the utmost importance that we review any consequential amendments required to be made, including to other Acts of Parliament. We have therefore conducted a thorough review of how the reforms brought forward in this Bill will require necessary changes. The following amendments focus specifically on consequential changes resulting from Part 2 of the Bill.
Government Amendment 52 is a minor and technical amendment which reflects the movement of material from Section 175 of the Housing Act 1985 into the new Section 7A of the 1967 Act. The amendment preserves a part of the current law which deals with a number of exemptions for the valuation of a freehold acquisition under Section 9(1) of the 1967 Act which will still be available under a “preserved law claim”. This will make sure that the Bill retains the current restrictions and will remove any potential for unintentionally expanding the number of tenants who qualify for a Section 9(1) valuation and consequently for a preserved law claim. Right-to-buy tenants who qualify for enfranchisement rights will be no worse off and benefit in the same way from the new valuation scheme as other leaseholders.
Government Amendment 53 inserts a new clause, which acts as a paving amendment to introduce a new schedule. This new schedule brings together the consequential amendments to other legislation. As a result of this new schedule, government Amendments 50 and 51 remove consequential amendments to the Housing and Planning Act 1986, which are currently contained in Schedule 8; these are now addressed in the new schedule.
Amendment 56 inserts the new schedule, entitled “Part 2: consequential amendments to other legislation”. This new schedule is extensive and brings together the consequential amendments across 19 other Acts into a single place. None of the amendments makes separate, substantive changes, but, rather, the new schedule allows this Bill to mesh with and integrate seamlessly with other legislation. These consequential amendments will: remove provisions which will become obsolete as a result of the changes made by the Bill; enable freehold acquisition claims of houses under Section 9(1) of the Leasehold Reform Act 1967 to continue to operate as they do currently, while making sure that provisions in other legislation do not override our new valuation scheme; make clear how to treat the valuation of freehold acquisitions for right-to-buy tenants; preserve the current law so that non-litigation costs payable on enfranchisement do not attract stamp duty land tax, allowing the operations of stamp duty land tax to continue as intended; and make sure that provisions of other Acts governing shared ownership leases will still function properly following the repeal of some shared ownership provisions in the 1967 Act.
Government Amendments 88 and 89 are tidying-up amendments to align the terminology in Clause 77 with terminology used elsewhere in Part 5.
Finally, with sincere thanks to noble Lords for bearing with me and for their patience, I turn to government Amendment 90. This is a clarificatory amendment which seeks to deal with any potential confusion over the extent to which the Bill applies to event fees. As noble Lords may know, some leases require the leaseholder to pay a fee on certain events, such as the sale of the premises or a change of occupancy. These so-called event fees are common in specialist housing for older people. How event fee terms are drafted varies from one lease to the next, as does what the money is used for. This amendment is not concerned with the regulation of event fees; the Government have committed to making event fees fairer and more transparent and will implement agreed Law Commission recommendations when parliamentary time allows. There is a risk in the current drafting of the Bill that the specific nature and purpose of event fees may be regarded as an administration charge under Clause 81. That would, in turn, mean that they are subject to the test of reasonableness, which we do not consider appropriate for a fee of this nature. The amendment therefore sets out a definition of an event fee and makes it clear, for the avoidance of doubt, that any event fee is not to be regarded as an administration charge. I beg to move.
Lord Khan of Burnley (Lab)
I thank my fellow east Lancastrian, the Minister, for introducing these technical, tidying-up and clarificatory amendments.
Lord Gascoigne (Con)
I have spoken ad nauseam about many of these amendments. I too thank my long-lost brother from east Lancashire, the noble Lord, Lord Khan, and say what a pleasure it is to follow him.
Lord Gascoigne
Member's explanatory statement
This amendment would reflect that the Development Board for Rural Wales has been abolished.
“(ma) any clinical commissioning group;(mb) any Strategic Health Authority;(mc) any Primary Care Trust;”Member's explanatory statement
This amendment would ensure that the bodies listed are “local authorities” for the purpose of section 57 of the Landlord and Tenant Act 1954.
Member's explanatory statement
This amendment would replace reference to the National Rivers Authority with reference to its successor body, the Environment Agency.
Safety of Rwanda (Asylum and Immigration) Bill
Monday 22nd April 2024
(3 weeks, 5 days ago)
Lords ChamberRead Full debate Safety of Rwanda (Asylum and Immigration) Act 2024 View all Safety of Rwanda (Asylum and Immigration) Act 2024 Debates Read Hansard Text Watch Debate Read Debate Ministerial Extracts Amendment Paper: Commons Consideration of Lords Message as at 22 April 2024 - (22 Apr 2024)
20:24 - Division on Motion A1 - Ayes: 240 / Noes: 211 - Motion A1 agreed.
Lord Sharpe of Epsom
That this House do not insist on its Amendment 3G, to which the Commons have disagreed for their Reason 3H.
The Parliamentary Under-Secretary of State, Home Office (Lord Sharpe of Epsom) (Con)
My Lords, in moving Motion A I will also speak to Motions B and B1. I am very grateful to noble Lords on all sides of the House for the careful consideration of this Bill. It is important that we have such detailed debates, and that the Bill has been scrutinised to the extent it has, but we must now accept the will of the elected House and get this Bill on to the statute book.
I turn now to the amendment in the name of the noble and learned Lord, Lord Hope. Having now debated this issue on so many occasions, I will not repeat the same arguments, but I remind the House of a key point of which I am sure, by now, noble Lords are fully aware. The Bill’s provisions come into force when the treaty enters into force, and the treaty enters into force when the parties have completed their internal procedures. We will ratify the treaty in the UK only once we agree with Rwanda that all necessary implementation is in place for both countries to comply with the obligations under the treaty.
I refer to the remarks of the noble and learned Lord, Lord Hope of Craighead, during our debate on 20 March, when he said:
“I want to make it plain that I do not for a moment question the good faith of the Government of Rwanda when they entered into the agreement or when they seek to give effect to what the treaty says. I do not for a moment question their determination to fulfil the obligations that they are undertaking”.—[Official Report, 20/3/24; col. 226.]
The Government entirely agree with this sentiment. The noble and learned Lord was right not to question the determination of the Rwandan Government to fulfil the obligations that they are undertaking. Their commitment to the partnership and their obligations under the treaty have been demonstrated by the progress they are making towards implementation.
I set out last week the recent steps that have been taken to implement the treaty and I do not intend to repeat those again, but I am pleased to be able to confirm further progress. On 19 April, the Rwandan Parliament passed domestic legislation to implement its new asylum system. The new Rwandan asylum law will strengthen and streamline key aspects of the end-to-end asylum system, in particular decision-making processes and associated appeals processes.
I remind noble Lords of the role of the independent monitoring committee, which, as noble Lords will all be aware by now, has been enhanced under the terms of the treaty to ensure compliance in practice with the obligations under the treaty. The monitoring committee will have the power to set its own priority areas for monitoring. It will have unfettered access for the purposes of completing assessments and reports, and it will have the ability to publish these reports as it sees fit. It will monitor the entire relocation process from the beginning, including initial screening, to relocation and settlement in Rwanda. Crucially, the monitoring committee will undertake daily monitoring of the partnership for at least the first three months to ensure rapid identification of and response to any shortcomings.
As we have made clear, if the monitoring committee were to raise or escalate any issues to the joint committee, where standing members of the joint committee are senior officials of the Government of the UK and the Government of the Republic of Rwanda with responsibility for areas related to the partnership, or areas with a strong interest in and relevance to this activity, the Government will of course listen. I remind noble Lords that it is up to the independent monitoring committee to raise any issues at any point.
The Government are satisfied that Rwanda is safe. Of course, I cannot predict what will happen in the future but, as I have set out, I can assure this House that we have already established the right mechanisms so that, should a situation ever arise, the Government will respond as necessary. This would include a range of options to respond to the circumstances, including any primary legislation as required. Therefore, this amendment is not necessary.
I turn to the Motion in the name of the noble Lord, Lord Browne. As I have said previously, the Government greatly value the contribution of those who have supported us and our Armed Forces overseas. That is why there are legal routes for them to come to the UK. On 1 February the Ministry of Defence updated Parliament on developments relating to the Afghan relocations and assistance policy—ARAP—scheme, announcing a reassessment of decisions made on applications with credible links to Afghan specialist units. This followed the Ministry of Defence’s review of processes around eligibility decisions for applicants claiming service in Afghan specialist units, which demonstrated instances of inconsistent application of ARAP criteria in certain cases. We are taking necessary steps to ensure that ARAP criteria are applied consistently.
As such, the Ministry of Defence has decided to undertake a reassessment of all eligibility decisions made on ineligible applications with credible claims that have links to Afghan specialist units. This reassessment is being done by a team that is independent of those who conducted the original casework. It will review each application thoroughly on a case-by-case basis.
In existing legislation, including but not limited to the Illegal Migration Act, the Secretary of State has a range of powers to consider cases and specific categories of persons. I have already made clear, and given a clear commitment on behalf of His Majesty’s Government, that we will consider how removal under existing immigration legislation would apply. That means that once this review of ARAP decisions for those with credible links to Afghan specialist units has concluded, the Government will not remove to Rwanda those who have received a positive eligibility decision as a result of this review, where they are already in the UK as of today. The Government recognise the commitment and responsibility that comes with combat veterans, whether our own or those who showed courage by serving alongside us. We will not let them down.
The House of Commons has considered and rejected these amendments four times. For the reasons I have set out, they are not necessary. We will ratify the treaty only once we agree with Rwanda that all necessary implementation is in place for both countries to comply with the obligations under the treaty. We will not relocate people to Rwanda if circumstances change that impact on the safety of the country, and we will not turn our backs on those who have supported our Armed Forces and the UK Government.
Illegal migration is costing billions of pounds and innocent lives are being lost. Bold, novel solutions are required, and our partnership with Rwanda offers just that. Rwanda is a safe country that has proven time and again its ability to offer asylum seekers a safe haven and a chance to build a new life. I beg to move.
Motion A1 (as an amendment to Motion A)
Lord Anderson of Ipswich
At end insert “, and do propose Amendment 3J in lieu—
“(7) The Republic of Rwanda may be treated as a safe country for the purposes of this Act only once the Secretary of State, having consulted the Monitoring Committee formed under Article 15 of the Rwanda Treaty, has made a statement to Parliament to that effect.
(8) The Republic of Rwanda must cease to be treated as a safe country for the purposes of this Act once the Secretary of State has made a statement to Parliament to that effect.””
Lord Anderson of Ipswich (CB)
My Lords, I beg to move Motion A1 as an amendment to Motion A. I do so in the unavoidable absence of the noble and learned Lord, Lord Hope of Craighead, who tabled the previous versions of Amendment 3 and has been good enough to approve this one.
We are in the endgame now. We will, this week, have a law that provides for the offshore processing and settlement of asylum seekers in Rwanda. Its benefits remain to be seen. Its costs will be measured not only in money but in principles debased—disregard for our international commitments, avoiding statutory protections for the vulnerable, and the removal of judicial scrutiny over the core issue of the safety of Rwanda. That is now a fact, and there is nothing more we can do about it.
But there is a further principle, as precious as any of those, to which we can still hold fast. One might call it the principle of honesty in lawmaking. I presume on your Lordships’ patience this evening because we have it in our power to reinstate that principle without damaging the purpose of this Bill or delaying its passage any further. We are concerned with the safety of Rwanda, both in the present and in the future. This Bill is honest about neither.
The present position is governed by Clause 1(2) of the Bill, which
“gives effect to the judgement of Parliament that the Republic of Rwanda is a safe country”,
yet there has been no statement even by the Government that Rwanda is currently a safe country, as defined in Clause 1(5). The Minister said just now—I noted his words; they are the same words he used last Wednesday—that
“we will ratify the treaty in the UK only once we agree with Rwanda that all necessary implementation is in place for both countries to comply with the obligations under the treaty”.—[Official Report, 17/4/24; col. 1033.]
This has not yet happened. Against the background of what the Supreme Court described on the evidence before it as
“the past and continuing practice of refoulement”,
those obligations include, by Article 10(3) of the treaty, the agreement of an “effective system” to ensure that refoulement no longer occurs. The Minister has repeatedly declined the invitations of the noble Lord, Lord Kerr, to confirm that this system—a precondition for the safety of Rwanda—is fully set up and ready to go. Neither have we heard anything from the monitoring committee. While the Minister’s confidence is comforting up to a point, we are simply not in a position to make the judgment this Bill imputes to us.
The Bill’s treatment of the future is still further from reality. Parliament is asked to declare that Rwanda will always be a safe country, even if the progress made since the genocide of the 1990s—and one can only commend Rwanda on that—should ever falter or go into reverse. Decision-makers, immigration officials, courts and even the Secretary of State are bound by Clause 2 to treat Rwanda conclusively as safe in perpetuity.
Bluntly, we are asked to be complicit in a present-day untruth and a future fantasy, by making a factual judgment not backed by evidence, then by declaring that this judgment must stand for all time, irrespective of the true facts—this in the context not of some technical deeming provision in the tax code but of a factual determination on a matter of huge controversy on which the safety of human beings will depend. This is a post-truth Bill. To adapt a phrase we have often heard from the noble Lord, Lord Norton of Louth, it takes the culture of justification, which is a trademark of this House, and replaces it with a culture of assertion. It takes hopes and rebadges them as facts. It uses the sovereign status of this Parliament as a shield from scrutiny, and it makes a mockery of this Bill.
My amendment addresses first the present and then the future. The first part, proposed new subsection (7), requires the Secretary of State to tell us when, in his judgment, Rwanda is safe. It is this statement, not the judgment we are supposed to be reaching tonight, that will determine when the flights may lawfully begin. He has the detailed evidence on this. Despite our best efforts, we have had only scraps.
In previous versions of the amendment, this ministerial statement on the safety of Rwanda has been conditional on a favourable opinion from the Government’s own monitoring committee, established under the treaty, which we are told is already operational and which is ideally placed to assess the evidence. It has been objected, on previous occasions, that the monitoring committee should have no more than an advisory role. The noble and learned Lord, Lord Hope, and I have listened and have revised this amendment, which now provides only for the monitoring committee to be consulted. The statement on safety would be purely for the Secretary of State.
The noble and learned Lord, Lord Falconer, asked the Minister last Tuesday to confirm that
“before the Government are satisfied that Rwanda is a safe country, they will seek the views of the monitoring committee”.—[Official Report, 16/4/24; col. 900.]
No such assurance was forthcoming. I cannot say why not; perhaps we will get an assurance this evening. Failing that, this amendment would write one into law.
The second part of my amendment, proposed new subsection (8), deals with the future. The noble and learned Lord, Lord Hope, pointed out the problem in these terms:
“no provision is made anywhere in the Bill for what should happen if the facts change and everyone can see that Rwanda is no longer safe”.—[Official Report, 16/4/24; col. 902.]
Sir Jeremy Wright, Sir Bob Neill, and Sir Robert Buckland—none of them lefty lawyers, the last time I checked—have made the same point in the Commons debates. The Minister indicated last week that if the Government thought Rwanda had become unsafe, there might be some unspecified “parliamentary occasion” to mark that development, but of course no such occasion, other than the passage of a full Act of Parliament, could do the trick. I think that was effectively acknowledged by the Minister in the Commons this afternoon.
This assumption of perpetual parliamentary infallibility is an embarrassment and a nonsense. Fortunately, there is an alternative, which presents not the slightest threat to what the Government are seeking to achieve. Proposed new subsection 8 would give the Secretary of State an untrammelled power to decide in the future that Rwanda is no longer a safe country. Such a decision would release all decision-makers, including himself, from a legal fiction that makes the law look like an ass and those who make it asses.
So there is a speedy and effective way to reinstate the principle of honesty in lawmaking. To quote the parting words of Sir Robert Buckland, who rebelled this afternoon, alongside Sir Jeremy Wright, “Sort this out now”. I persist in the hope that reason may yet break out in the Minister’s response. If it does not, I propose to test the opinion of the House. I beg to move.
Lord Browne of Ladyton (Lab)
My Lords, I will speak to Motion B1 and Amendment 10H in lieu. I have given a great deal of thought, in recent times, to the question of what courage and strength look like. I ask myself today whether it a desperate and unpopular Prime Minister threatening to keep some of us septuagenarians up all night if we do not bow to his will, or putting yourself and your family in mortal peril by fighting totalitarianism alongside British forces with no idea of how that struggle will end. I know which I consider to be brave and strong, and I believe that the overwhelming majority of your Lordships, like others up and down the United Kingdom, of whatever age or political persuasion, agree. For weeks, Ministers have toured the TV and radio studios, saying that to repay our debt of honour to those who have served the Crown, in Afghanistan in particular, would open the floodgates of applications. If the concession I seek would open such floodgates, creating oceans of imposters, this would be only as a result of the Government’s own incompetence and lack of preparation. It is incompetence, as well as dishonour, that has brought us here this evening.
In the summer of 2021, the former Foreign Secretary, Dominic Raab, told us in a statement to the Foreign Affairs Select Committee, that the Government were developing a plan for the evacuation of our exposed allies and agents from Afghanistan. If your Lordships will allow me a moment, I will read my exact words when reporting this to the House:
“Dominic Raab told the Foreign Affairs Select Committee that, back in July, the Government were planning for the possibility of an evacuation of British citizens and those who were quite rightly entitled to think that we had a moral obligation to secure their lives”.—[Official Report, 7/9/21; col. 812.].
I remember, post Operation Pitting, asking if someone would share that plan with me, to see whether it included the reality that those who were sent to help people evacuate left before those who needed to be evacuated could be.
In a Statement repeated in your Lordships’ House and set out in full in Hansard on 7 September, the Prime Minister, Boris Johnson, told your Lordships that the Taliban must ensure safe passage and that the Government would keep ongoing evacuation plans under review in respect of such people. He said this:
“Let me say to anyone to whom we have made commitments and who is currently in Afghanistan: we are working urgently with our friends in the region to secure safe passage and, as soon as routes are available, we will do everything possible to help you to reach safety”.—[Official Report, Commons, 6/9/21; col. 21.]
Those are the words of the Prime Minister, repeated here. After the Statement was repeated in your Lordships’ House, we were told that this plan had been in existence for most of that year and that it had been reviewed in January, and was repeatedly reviewed, so that the chaos that we saw at Kabul airport would not happen—but it did.
You would have thought that, with all of that planning and information behind it, and having recruited and trained the Triples and paid them out of the embassy in Kabul, the 2,000 people who made them up—who were most at risk, and who had been working for us, in harm’s way—would have been known about, recorded and evacuated, and that it would have been the simplest thing in the world to triage anybody who claimed to be of that group out of the ARAP process. That is not how it turned out. Instead, a great many were left behind, and so the disastrous evacuation plan of 2021 continues.
The Government created this problem, which has caused at least nine of those who fought for us to be executed by the Taliban because the promised safe passage never appeared. His Majesty’s Government told us, even last week, that there would be no concession in respect of those people who had come here because they were frightened for their lives, and were entitled to be frightened for their lives and to find a way of getting here if there was no safe passage.
Why no concession for so long? I am asked this question every day—every day, since we started debating this issue, I am asked by many people, including many Conservative politicians, why there has been no concession: “Why have they not been able to work something out with you? Why the delay?”, they ask me. Either the Government have no confidence in their ability to implement this plan and are seeking in some way to delay it—considering it to be not their responsibility—or they just want the theatre of delay to their flagship Bill, so as to blame Labour, the Lords, the courts and so on. Today, the Government finally bring a concession: having offered and then withdrawn it last week, they refused to put it in the Bill.
I break away now to ask the Minister to re-read the passage of his speech that I call a concession—I know he does not—and to read it a bit more slowly, so that we can understand its implications. If not, if he has a printed a copy, I will read it slowly. I invite him to read it again, please. Will the Minister do that now, as it is important to the rest of my speech?
Lord Sharpe of Epsom (Con)
With the leave of the House, I will read it very slowly:
“That means that once this review of ARAP decisions for those with credible links to Afghan specialist units has concluded, the Government will not remove to Rwanda those who have received a positive eligibility decision as a result of this review, where they are already in the UK as of today”.
Lord Browne of Ladyton (Lab)
You cannot be removed and deported to Rwanda unless you are here by what the Government call illegal means and what I call irregular means. Those words are important for this reason. The Minister does not believe this to be a concession; it is to him a restatement of what he has been telling us for some time, but in a different form. In my view it is quite clearly a concession, although I guarantee that the media out there are being briefed that it is not, because there can be no concessions on this Bill.
Let me tell noble Lords why it is a concession. At Report on this Bill in your Lordships’ House, on 4 March, as recorded at col. 1420 in Hansard, I asked this question of the Minister:
“Will the Minister answer the question I asked in February when this review was announced”—
meaning the Triples review of eligibility for ARAP—
“will anyone who is eligible but was told they were ineligible—and acted in a way in which a small number of them did in extremis to protect themselves from possible death—be disqualified from being allowed to become eligible on review? Will they be excluded from the requirement of the Illegal Migration Act and this Bill if it becomes law that they must be deported to Rwanda?”
The Minister answered—it was the first time he was in a position to do so:
“As I understand it, they will be deported to Rwanda”.—[Official Report, 4/3/24; cols. 1420-1421.]
Now they will not be. That is a concession in anybody’s language.
It is an extremely important concession, because these are the small number of people who I have said, in every speech I have made in support of my amendment, are the target of my ambition that they will not be deported. Today, the Government finally bring a concession, having offered then withdrawn it, so should I trust them at their word? They left these people behind; they messed up any subsequent evacuation plan. This is a third opportunity competently to do the right thing. Why should I trust them now?
I will tell your Lordships why I am minded to consider doing so, although I have not yet made up my mind. It is because we are now part of a grand coalition, including noble and gallant Lords, many very senior politicians and officials, who have secured this country for years and put their names to this, veterans, campaigners and many voters of all persuasions and traditions across our nations—and we will not be silent until today’s promise is honoured by this Government or the next one.
Finally, what does this ignominious history tell us about the Rwanda policy as a whole? There were no safe routes for those heroes to whom we owe a debt of honour, still less are there safe routes for any other genuine refugees worthy of the promise of the refugee convention—also paid for in courage and strength in an earlier war, so many years ago. While I may not press my Motion this evening, I look forward to the day when a Labour Government repeal this immoral and unlawful excuse for legislation in total.
Lord Carlile of Berriew (CB)
My Lords, it is a privilege to follow the noble Lord, Lord Browne of Ladyton. His persistence, his clarity and his determination have, in my view, led to a meaningful concession—and it is a concession—by the Government on a very important issue. To those who say that your Lordships’ House has not behaved legitimately and constitutionally in relation to this Bill, we can at the very least point to the concession that has been made to the noble Lord, Lord Browne, as justification for still being here debating the Bill tonight.
I stand principally to speak in total support of the admirable speech given by my noble friend Lord Anderson in favour of Motion A1. I will return briefly to Motion A1 in a few moments but, before I do, I wish to place on the record something which concerns me very much about the fact that we are debating this matter at all today. I do so with appreciation for the characteristically gracious and considerate words spoken by the Government Chief Whip earlier this afternoon. I was not in the House, because I did not know she was going to say it, but I have been able to watch it on that splendid organ, parliamentlive.tv.
I speak as a religiously confused person, born with 100% Jewish blood but brought up in the Church of England by convert parents. I note that there may well be some Jewish Peers in the House today. Others, I know, are absent on the grounds of conviction and conscience, for today is the first day of the Passover festival—of Pessach, one of the Jewish religion’s most sacred holidays. It is a day when Jewish families gather, sometimes with their friends—I should have been at one such event tonight—around a dinner table to pray, to eat, to sing and to retell the story of the exodus, with the help of a narrative liturgy called the Haggadah. For those who have been to such a Seder, it is a joyful experience and it brings home to one the importance of the first day of Passover. I am told that strong representations were made, not least by the Labour Party, through the usual channels, to avoid the final stages of the safety of Rwanda Bill being heard today. The Jewish community, although it places great importance on the first and second days of Pessach, would have been willing to be here tomorrow or any other day this week. Unfortunately, that was refused.
I have tried hard to think of a legitimate reason for that refusal. If this debate had taken place on Tuesday, Wednesday, Thursday or Friday, or next week, it would not have made any material difference to the Government’s position. Nothing that was said by the Prime Minister, who on 11 November displayed, properly and rightly, his devotion to his own religion in public, has justified choosing today for this debate. I take it as an offence to our ambitions for diversity in this country— sermon over.
Lord Hodgson of Astley Abbotts (Con)
My Lords, I want to say a few words after the bravura performances from the noble Lords, Lord Anderson of Ipswich and Lord Carlile of Berriew.
I take a slightly different view. Before we get into the detail, we need to remember the purpose behind the Bill as seen across the country. First, the Bill is designed to stop the boats. The noble Lord, Lord Carlile, pointed out that in fact the number of people crossing on the boats is increasing. That is probably because they realise that, if this is stopped, then they had better get here before that. Secondly, we need to remember that, in doing that, we are seeking to stop people drowning and dying in the channel. Thirdly, we are trying to break the economic model of the people smugglers. Fourthly, and most importantly, we are trying to ensure that people do not jump the queue, either because they are coming from countries which are safe or because they are economic migrants and are not in any way asylum seekers or refugees.
Whether the Bill will meet its objectives, of course I do not know. It may well be that “I told you so” will be a very frequent refrain a year from now. But I do know two things. First, it cannot make the situation worse. People will not go down to the beaches in Calais to come here because we pass this Bill. Secondly, at present it is the only game in town.
I turn to the amendment in the name of the noble Lord, Lord Anderson. Of course, he has very persuasive arguments; honeyed words which we have heard. I have heard them many times on Radio 4 and at other times, and congratulated him on them. He says that this will be a small amendment that does not really make any difference. I entirely accept what he says.
However, anybody who is going to vote for this tonight needs to think in their heart whether they are really seeking to improve the Bill or to impede it but not wreck it. They are engaged in what I might describe as a game of dragon’s teeth. The House will recall the mythological tale of Cadmus and the foundation of Thebes. He killed the dragon and planted the teeth on the ground. They had the fortunate aspect of springing up into fully fledged warriors. Each time they were struck down, more warriors came up in their place. Sometimes, when I hear speeches from around your Lordships’ House, behind all the obvious belief that comes with them, I think, “Hang on. Behind this is a wish not to let this Bill through at all. People are thinking, ‘We do not like the Bill, but we do not want to be put in the position where we are going to kill it’”.
It has particularly revolved around the issue of the judgment of the Supreme Court on whether Rwanda is a safe country. “Safe” is a big word and particularly a big word with the weight placed on it in this regard. It is entirely true that in very few cases are we entirely safe. I find myself wondering whether “judgment” is the right word or whether what the Supreme Court undertook was a risk assessment, which is a different approach.
Members of your Lordships’ House will probably be aware of the concept of assessor bias—that we are much more ready to put low risks on to problems with which we are familiar compared with those with which we are unfamiliar. In that sense maybe because we are familiar with the Government and the legal systems of, for example, France and Germany and western Europe and not with an African country, some additional risk may be placed and we need to consider that very carefully.
Let me make it clear that I am not in any way impugning the good faith of the Supreme Court. What I am saying is that the court’s risk assessment needs to be weighed and balanced against the other assessments and the undertakings given by my noble friend on the Front Bench—for which, by the way, the Government will be held responsible by Parliament. There are also third-party assessments, such as the Ibrahim Index of African Governance, which rates Rwanda 12th out of 54 African countries. I have said in past speeches that other third-party risk assessments give confidence to my support for this Bill.
My last question is for His Majesty’s loyal Opposition. We have heard from the noble Lord, Lord Browne of Ladyton, that he is looking forward to some commitments from them, if they are to form the next Government. I have said to some noble Lords that, when I am sitting here in a long, perhaps rather tedious, Committee, I think, “What great stars of stage and screen would be best portrayed by the great men and women who cover our Front Benches?” The noble Lord, Lord Coaker, is, for me, Harrison Ford, slashing his way through the parliamentary undergrowth—and very effectively too. But it cannot disguise the lacuna at the centre of the Opposition’s position. Of course, now, with the polling, they will clearly be expecting—
Baroness Chakrabarti (Lab)
I am so grateful to the noble Lord for momentarily giving way. I think Isb speak for most of us on this side when I say that we understand that his comments are sincere and in no way a filibuster, but would he consider whether casting everyone in their Hollywood guises is an appropriate use of the House’s time this evening? Might he just focus on the amendment from the noble Lord, Lord Anderson, which very briefly and very simply requires the Secretary of State to lay before Parliament a report from a treaty and a monitoring committee of his own making? That is the amendment that I believe the noble Lord, Lord Hodgson, is addressing. Does addressing that really require the honeyed words and Technicolor that we are currently listening to?
Lord Hodgson of Astley Abbotts (Con)
My Lords, I am sorry if I was not clear. I think I have spent some time discussing the issue of risk assessment and the way the risk is being weighed by various parties, various people and various bodies. This is the point that the noble Lord, Lord Anderson, has arrived at: it is his assessment of where we are on the risk profile. I have said that I fully accept his position as being entirely genuine.
On the last point, we are now standing on the edge of a period of possible political change. I am sure that Members of the party opposite are hoping that they will be here next year and we will be over there. It is not unfair, in those circumstances, for us to ask the Opposition tonight, as we come to this very critical point—the point everyone agrees is critical—and for the noble Lord, Lord Coaker, to tell us, if this Bill works, and they form the next Government, whether they intend to continue to use this Bill or if they would scrap it. If they would scrap it, the country is entitled to know. If they would continue to use it, then let us stop the dragon’s teeth, let us stop playing games, and let us get on, pass this Bill into law and make sure that what happens happens.
Lord German (LD)
My Lords, I will dwell on the amendments before us. While I would love to stray into almost Second Reading speeches, like we have heard, on the state of the Bill as a whole, the issue before us are the very specific amendments that have been put down.
I want to say something about what the House of Commons has been doing. Other people have been calling this House the body that is responsible for delay. The delay is not caused by this House. We could have been dealing with this on other days earlier than this. It is at the choosing of the Government, in the other House, how this Bill plays through this House. Therefore, we cannot be accused of not doing our job properly, because that is what we are doing. It is the Government who have been slowing down the business of the Commons, for whatever reasons they feel are acceptable to them. This House is doing the proper job; certainly, we are with these amendments before us today, because the reasons we are debating and pressing these very important safeguards on this House and on this Parliament are so important.
We are asked to declare, in the Bill we are debating, that Rwanda is safe for refugees and asylum seekers. Yet, when asked when the policy on refoulement—the most principal policy that was pointed out by the Supreme Court—is to be put in place, the Government could not give any answer at all. I ask the Government tonight: what assurances can they give that the policy on refoulement, and the appropriate training and systems to support it, will be in place in the next 10 to 12 weeks? That 10 to 12 weeks is important, given the statement by the Prime Minister this morning.
A second protection, in the amendment of the noble Lord, Lord Anderson, is for the future, since as the Bill stands it binds a Secretary of State in perpetuity.
I now turn, very briefly, to the amendment of the noble Lord, Lord Browne. I listened very carefully for repetition, which he asked us to do. It seemed to me that there was one very specific group of people who will not be subject to the concession called for by the noble Lord, Lord Browne. It will not work for people who have a justifiable claim and are, at this moment, outside the United Kingdom. That is a very specific group of people. Some of them in Pakistan are being threatened with being sent back to Afghanistan, based upon the experience of a Bill of a similar sort to the one we are debating tonight.
My belief—and, I hope, the belief of this House and, certainly, the belief of these Benches—is that, for those people who were allies, there must be a record somewhere. There must be a record, if they were an ally of ours. Somewhere they were employed by the British forces, or somewhere they were being paid for out of British funds. Somewhere they will be on a company record for supplying services to the United Kingdom’s forces. So it is the Government who will know who these people are, and they will know when an application comes before them, whether there is the prospect of success for them. What I did not hear tonight, and this House did not hear tonight, was a copper-bottomed guarantee that those people, seeking applications to come here from outside the United Kingdom, will not be sent to Rwanda either. That guarantee was not given, and I hope that the noble Lord, Lord Browne, will reflect on that matter, when he comes to discuss this at the conclusion of this debate.
In conclusion, it seems to us on these Benches that, despite what we feel about this Bill—and I echo many, in fact all, of the criticisms made by the noble Lord, Lord Carlile, because we have made them, and we made them a right at the beginning of the Bill at the appropriate time—now is the time for seeking amendments that actually safeguard critical groups of people and, most importantly, the critical role this Parliament plays. We are being asked to make a judgment. The Motion of the noble Lord, Lord Anderson, helps this Parliament make some brave and right choices—to be able to tell the truth about matters, rather than leaving it to fiction.
Lord Coaker (Lab)
My Lords, I start by saying straightaway to the noble Lord, Lord Hodgson, since he asked me what we would do, if—and I emphasise “if”—we win the next election: we will repeal the Bill. We have been quite clear about that, but that is not what we are debating this evening. We are debating the Bill that we have before us and, in particular, the two Motions A1 and B1.
I think it is important that we dispel some of the myths around the debate that has taken place today, started by the Prime Minister this morning in his press conference. He seemed to imply that the debate in this Chamber is between those who want to stop the boats and those who do not, whereas I have made the case continually, as every Member across this Chamber has done, that we all agree that we need to stop the boats; the dispute in this place is about exactly the right way to go about that and to do that. That is the important distinction that lies between us.
We believe that the Bill as it stands is inconsistent with the principles and traditions of our country and, as such, that is why we oppose it and the various arguments that have been made. Never have I stood at this Dispatch Box and at any time said to the noble Lord, Lord Sharpe, the noble and learned Lord, Lord Stewart, the Government Chief Whip or the Leader of the House that we will block the Bill. That has never been the policy of His Majesty’s Opposition, and never been something we have said from this Dispatch Box; indeed, we voted against a Motion that was put before us some weeks ago to do that. But we have also said that we would stand up for the proper position of this House. The proper role of this Chamber is to argue, to debate, to revise, to suggest amendments and to put forward that case. I say to the noble Lord, Lord Sharpe, I hope he is in a position, in a few months’ time, where he is stood here doing exactly the same as I am, and being as a frustrating and challenging as I am trying to be to him, because that is the proper role of the House of Lords. Therefore, it is important that we do that.
I cannot remember which noble Lord said this, but if the Government were as worried about the delay as they say they are, why on earth did they not sort all this out before Easter? All their own side were whipped to be here on a Monday after we debated on the Wednesday, only to have a further email go out to say they would no longer be required. That is how much of an emergency the legislation was. The Government could have cleared this before Easter, and yet they did not, presumably because the Prime Minister could not guarantee that everything was in order for the Bill to work. Let us not talk about the House of Lords delaying the legislation; let us look at the Government’s timetabling of their own business and their inability to get that right. Even today, the Government in a press conference to the lobby, as I understand it, could not give any detail of the numbers that they expect to be subject to the provisions of this treaty—the numbers of flights they expect or, indeed, the exact date when it will take place.
This has never been an argument about the integrity of this Chamber. I do not believe that there is a single Member of this Parliament, in the other place or this Chamber, or any of the journalists who report our proceedings, who does not have proper integrity. I would not have gone on the radio, as a Government Minister did this morning, and accused this House of bordering on racism in the way in which it debated the Rwanda treaty. That is a shocking and appalling comment to make. I do not believe that that is what the noble Lord, Lord Sharpe, thinks, and I do not think that anyone in here has been bordering on racism in anything that they have said. I have heard detailed arguments and positions espoused by many, but nobody in here—or in the other place, or anybody who reports on these proceedings—has been anywhere near racist or racism. There is a legitimate difference of view, but we should not resort to those sorts of things being said.
I object also to what the Prime Minister did this morning, when he suggested that those of us who opposed the Rwanda Bill before us lacked compassion—that somehow there was anybody who was not opposed to the drownings or some of the appalling things that we see. Of course, we are all opposed to that—there is not a single individual in this Chamber, in the press or in the other place who does not abhor some of that which takes place. But that is the context in which we have been debating this issue.
We are quite right to turn to around and say that we should look at what the noble Lord, Lord Anderson, is saying, and what my noble friend Lord Browne is saying. But it is not just about Labour Peers. Again, the Prime Minister and other people have gone on saying, “Labour is blocking this—Labour Peers are blocking this”. We do not have a majority in here to block anything; we have to have the support of Cross-Benchers, Tory Peers abstaining or disappearing, as well as the Liberal Democrats voting with us and everybody else.
Lord Coaker (Lab)
Sorry, I missed out the noble Baroness, Lady Jones. It is like being at a wedding—you know that you are going to miss somebody out. You go through all the aunts and uncles and all the other relatives and you see the glower of Aunt Mabel from the back—not that that is you, Lady Jones! But seriously, that includes the Greens, of course. It is about all of us who believe that the Bill is wrong standing together. That is why it is important.
If the noble Lord, Lord Anderson, chooses to put his Motion A1 to the vote, of course we will support it and will be pleased to support it. It is a sensible amendment—it does not block the Bill; it simply says to the Government that they should let the monitoring committee that they themselves have set up talk to the Secretary of State, who can then make a Statement to Parliament saying that Rwanda is safe. That also gives the Government a get-out clause by saying that in future the Secretary of State, presumably on the advice of the monitoring committee, can say that Rwanda is not safe—whereas under the Bill at the moment, whatever happens, they are compelled to believe that it is safe. It is a perfectly sensible amendment.
I come to my noble friend Lord Browne’s amendment. It is a meaningful concession on the part of the Government, and that is a really important statement to make. Let me say to all those who are listening that when people question why it is important sometimes that the Lords stands firm and challenges the Government of the day, whatever Government that is, and why it sometimes says to the Government, “You’ve got this wrong and you need to think again”—in this case, thanks to tenacious noble Lords and the brilliance of my noble friend Lord Browne in what he has done—the reason why it is important is because sometimes the Government give way. That is what has happened. If we had not pushed this last week, this concession would not have happened. If we had given way two months ago, it would not have happened.
So far from this being about the Lords blocking anything or delaying anything, it is the Lords performing its proper constitutional function and bringing about change from the Government. That is what it is about—and it has been done in a way that actually gets the Government themselves out of a bind. We know that many on the Government’s Back Benches and Front Benches, including many in this Chamber, thought that what the Prime Minister, one presumes, was saying was wrong, and they needed the Prime Minister to change his position. So the strength of what was proposed in this Chamber by my noble friend Lord Browne forced the Prime Minister—and we presume that he supports all this—to change his mind and come forward with that concession.
The concession that the Minister read out is significant and important, and it is something that my noble friend Lord Browne can be proud of. It may not be everything that everybody would want, but sometimes in politics you have to do what you can and achieve what you can. In the face of what my noble friend was facing—an absolute refusal by the Government to make any concession at all, with the Prime Minister standing in Downing Street and saying that he would not change a single word of the Bill—that has now been proved to be false, in the sense that my noble friend Lord Browne and your Lordships have changed the mind of the Government.
Lord Sharpe of Epsom (Con)
My Lords, as ever, I thank all noble Lords who have contributed to this relatively short debate. I will deal with the points in the order in which they were made, starting with the noble Lord, Lord Anderson, with whom I am afraid I am going to have to respectfully disagree. I do not believe that we have debased our principles; I believe that we have upheld them. We have upheld the principle of the integrity of our sovereign borders; the principle of not ceding our immigration policies to criminal gangs; the principle to safeguard lives and deter, of course, dangerous and illegal channel crossings. That is and always has been the point of the Bill and it deserves to be restated.
Going back to my opening remarks, things have progressed since we were last discussing these matters, and I shall repeat them for the record. On 19 April, the Rwandan Parliament passed its domestic legislation to implement its new asylum system. The new Rwandan asylum law will strengthen and streamline key aspects of the end-to-end asylum system—in particular, decision-making processes and associated appeals processes. I am very grateful to my noble friend Lord Hodgson for reminding us of Rwanda’s high standing in international league tables. Things could not be clearer: there has been significant progress towards many of the things that the noble Lord was asking for. That includes, of course, the monitoring committee, and I will repeat this too. If the monitoring committee were to raise or escalate any issues to the joint committee where standing members of the joint committee are senior officials of the Government of the UK and the Government of Rwanda with responsibility for areas relating to the partnership or areas with a strong interest and relevance in this activity, the Government will of course listen. I remind noble Lords that it is up to the independent monitoring committee to raise issues at every point.
The future is not fantasy, as has been alleged. As is well known, the Government are satisfied that Rwanda is safe. We have acknowledged that we cannot predict what will happen in the future but, as I also set out, we can assure the House that we have already established the right mechanisms so, should a situation ever arise, the Government will respond as necessary. I repeat: this would include a range of options to respond to the circumstances, including any primary legislation as required. We do not regard this, as the noble Lord, Lord Carlile, asserted, as inexplicable. We regard this amendment as unnecessary.
Turning to the amendment of the noble Lord, Lord Browne, I am not going to get into the semantics of what this is or is not. What it actually is is the right thing to do. I say to the noble Lord, Lord German, that his remarks seem to have missed the entire point of the Bill. The simple answer to his question is: “Do not come here illegally”. There will be no possible pull factors. There is a safe and legal route available to those in Afghanistan who have served and can prove their eligibility under ARAP, and over 15,000 people have already availed themselves of it.
The noble Lord, Lord Carlile, raised the issue of Passover, and I heard what he said. The start of Passover was considered and very much understood and we completely understand the noble Lord’s concerns, but, ultimately, scheduling decisions are made with a variety of different factors in mind. However, I hear what he said.
I will also go back to the fact that stopping the boats is not an idle boast; it is actually in the introduction to this very Bill. I repeat for the record:
“The purpose of this Act is to prevent and deter unlawful migration, and in particular migration by unsafe and illegal routes, by enabling the removal of persons to the Republic of Rwanda under provision made by or under the Immigration Acts”.
The purpose is not an idle boast; it is on the face of the Bill.
The noble Lord, Lord German, referred to refoulement. This is from Article 10(3) of the treaty:
“No Relocated Individual (even if they do not make an application for asylum or humanitarian protection or whatever the outcome of their applications) shall be removed from Rwanda except to the United Kingdom in accordance with Article 11(1)”.
The treaty needs to be ratified before the Bill comes into effect, so I say to the noble Lord that that is when we will see the provisions being acted upon.
As I said earlier, the Commons have considered and rejected these amendments four times now and, for the reasons I have set out, they are not necessary. We will ratify the treaty only once we agree with Rwanda that all the necessary implementation is in place for both countries to comply with their obligations under the treaty, including refoulement. We will not relocate people to Rwanda if circumstances which impact upon the safety of the country change. We will not turn our backs on those who supported our Armed Forces and the UK Government.
I say to the noble Lord, Lord Coaker, who I am going to struggle not to think of as Lord Indiana Jones from now on, that I obviously hope I am not in his place in a few months’ time, but of course I respect his right, which he frequently deploys, to make my life difficult—and he does. Seriously, illegal migration is costing billions of pounds and innocent lives are being lost. Bold, novel solutions are required and our partnership with Rwanda offers just that. Rwanda is a safe country that has proven, time and again, its ability to offer asylum seekers a safe haven and a chance to build a new life. I beg to move.
Lord Carlile of Berriew (CB)
Before the noble Lord sits down, will he deal with one piece of nitty-gritty? Will he tell us a little more about the contract that apparently was reached with an airline?
Lord Sharpe of Epsom (Con)
No, I will not. That is an operational matter; we are discussing the amendments in ping-pong.
Lord Anderson of Ipswich (CB)
I thank all noble Lords who have spoken to my Motion A1. Perhaps I may make two short points in response. First, I say to the noble Lord, Lord Hodgson of Astley Abbotts, who knows how much I appreciate the work he does in this House and its committees, that a vote for this amendment is not a vote for delay. It simply gives the Secretary of State a power to declare Rwanda safe, having consulted his monitoring committee. He could do that tomorrow if he had the evidence for it. If he does not have the evidence for it, how can he expect us to do it tonight?
Secondly, I thank the Minister for his measured response, not to mention the best laugh of the evening, and for the additional scrap of information concerning the Rwandan law, I assume the asylum law, that he says was passed on Friday. I am afraid that it is the first I have heard of that. I do not know how many of us in the House have had an opportunity to study that law. He knows that these scraps fall far short of the comprehensive picture that we would need if we were seriously to make our own judgement that Rwanda is safe and that the concerns identified by the Supreme Court and our own International Agreements Committee in great detail, only in January, have been satisfied.
In a less frenetic political environment, this common-sense amendment or something like it could, I am sure, have been hammered out between sensible people around a table. Sadly, that does not appear to be the world that we are in. I am afraid that I see no alternative to pressing Motion A1 and testing the opinion of the House.
Lord Sharpe of Epsom
That this House do not insist on its Amendment 10F, to which the Commons have disagreed for their Reason 10G.
Lord Sharpe of Epsom (Con)
My Lords, I have already spoken to Motion B. I beg to move.
Parents: Separation
(3 weeks, 5 days ago)
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Lord Farmer
To ask His Majesty’s Government what steps they are taking to support parents considering separation, and to promote early resolution of private family law arrangements.
Lord Farmer (Con)
My Lords, I thank all noble Lords contributing to what I consider an important debate this evening. I will not soft-pedal why we are discussing these issues: parental separation is an enormous and egregious problem, the scale and ramifications of which few seem ready to acknowledge. Parental separation is a recognised adverse childhood experience; by the time British children turn 14 years old, 46% no longer live with both their natural parents. Family breakdown is a major risk factor for children and young people’s poor mental health. Children who experience it are significantly more prone to anxiety and depression. Research from the Institute of Psychiatry, Psychology and Neuroscience also found greater susceptibility to severe mental illness such as schizophrenia. The IFS’s Deaton review on inequality reported that between 1971 and 2019 the percentage of births outside marriage ballooned from 8% to 48%: half of all births take place in inherently less stable, cohabitating couple families, or to parents living apart from the outset. Professor Matthew Goodwin drily comments:
“Britain is now … giving Europe a masterclass in … ‘non-partnered motherhood’—namely, women who give birth with no partner at all”.
In the rest of Europe, 5% or fewer of mothers are in this position, but in Britain and the United States that figure is 15%, so a growing number of children have never experienced life with both their parents. Many then endure multiple transitions, where step-parent figures come and go, further compounding their sense that relationships are fundamentally unreliable or worse. Children living with father substitutes are eight times more likely to be on the at-risk register and 50 times more likely to die of an inflicted injury than those living with two biological parents. Centre for Social Justice research found that they are also twice as likely to get involved in crime. Some 75% of young offenders did not grow up with both parents, and 40% experienced abuse or neglect.
Adults are also deeply and detrimentally affected by family breakdown: it is often a gateway to poverty, loneliness, mental ill-health problems and domestic violence from informal partners. Kiernan and Estaugh’s research found that women are more likely to be physically abused, assaulted during pregnancy and seriously injured by live-in boyfriends than by husbands.
Professor Jan Walker’s research found that many wished they had been warned of the harsh realities of post-separation life. There is no information about sources of support on the online divorce system, and emails from it mention neither mediation nor options for help in agreeing child arrangements. Could the online divorce process signpost people to such support? Moreover, in this age of graduated smoking bans and online regulation to reduce well-evidenced harms, should we not point people to research-based information about how divorce is rarely the end of a painful process but the beginning of a new one, especially for their children?
Family instability is the social trend of the last half century. It gets almost no airtime in government yet is a major contributor to our housing and loneliness crises, among others—massive societal harms exacting huge costs on the taxpayer. Matthew Goodwin again calls out the hypocrisy of elites who are, he says,
“by far … the most likely to get married, have children in marriage, and then stay married”.
Yet they
“downplay the importance of stable families, encourage others to lead ‘fluid’, ‘individual’, and ‘diverse’ lives, and deride anybody who points to the importance of marriage and family as right-wing reactionaries who want to return to the 1950s”.
Their “Do as I say but not as I do” is a classic “luxury belief”, an idea aggressively promoted to bolster their own standing, despite the harms and costs entailed, but which they do not personally pursue.
Sadly, our own Government have undermined the value of commitment in hard times by introducing no-fault divorce to reduce conflict over what was on the divorce petition. However, the reality is that this source of conflict pales alongside that over money and children, and everything else that has to be negotiated when one household becomes two. The interminable wrangling over such issues fuels the immense backlog of well over 100,000 family court cases and the average 45-week wait for private family law cases involving children, despite the Government’s target of 26 weeks. Allegedly, in some areas it is over 60 weeks. All the time conflict, unhappiness and eye-watering costs grow: last year Cafcass alone cost almost £150 million. May I ask the Minister the total costs for that year for family courts and the family justice system? They do not seem to be published.
Our family courts are vital but should be the place of last resort. Before then, every proper assistance should be given to couples, as the Lord Chancellor said during the passage of the Divorce, Dissolution and Separation Act. His commitment was that
“as a Government, we will work harder … to bring together the strands of policy that sit with various Departments and to ensure that we have a family policy that is fit for the 2020s”.—[Official Report, Commons, 17/6/20; col. 902.]
The vehicle for doing that now is the growing number of family hubs in around 100 of 150 local authorities. I declare my interest as a guarantor of FHN Holding, the not-for-profit owner of the Family Hubs Network Ltd. Family hub networks include and build on Sure Start’s vital early years work. They bring together all the family support in an area for parents with older children and those with special needs.
The independent review of children’s social care and the Children’s Commissioner emphasise the need for integrated, community-based family support in family hubs. Moreover, historically, Michael Young, Labour architect of the welfare state, knew that struggling parents needed support. The Second World War had a long tail of effect on families, particularly the emotional cost of high levels of divorce and separation from parents—trends that have of course continued, as I have already outlined. Family centres were legislated for in the Children Act 1989; Sure Start children’s centres were the first step, and family hubs are the next iteration. However, much remains to do, extending way beyond the next election, for hubs to fulfil their transformational potential.
Since 2006, Australian family relationship centres have successfully signposted families away from the courts by providing mediation and focused guidance. A key message from the academic evaluation was that their work would be greatly enhanced by collocating or integrating help with housing, debt and other support that families need at times of transition. In other words, they would be greatly improved by being part of a family hub network—and our family hubs would be greatly improved if they included an offer akin to that of the Australian family relationship centres.
The March Budget promised £55 million for family courts, including money to support families through non-court dispute resolution. Ministry of Justice documents on earlier resolution of private family law arrangements prominently feature family hubs. Minimum expectations for all government-funded family hubs by March 2025 require support for reducing parental conflict and information for separating or separated parents.
Pioneering local authorities, such as Rochdale, already include evidence-based programmes for parenting when separated, and the Family Solutions Group has a pilot-ready model to further enhance such provision. Even in cases that must go before a judge, much could be achieved during pauses between stages by drawing on services in family hubs that help address entrenched relational difficulties, such as post-separation parenting programmes and support for their children. I ask the Minister again: will the Government fund such pilots and encourage family courts to work closely with hubs?
In conclusion, I have highlighted that family breakdown is the elephant in the room of many social policy problems. Family hubs are well-positioned to prevent and mitigate its considerable harms through early intervention and support. We must now build on the good foundations that the Government have laid in their family hubs programme, and maximise their potential in this vital area.
Baroness Tyler of Enfield (LD)
My Lords, I congratulate the noble Lord, Lord Farmer, on securing this debate, and it is a pleasure to follow him.
I have been involved in this area in various guises since my time as chief executive of Relate, as a former chair of Cafcass, and as chair of the Lords Select Committee conducting post-legislation scrutiny on the Children and Families Act 2014. As I prepared for this debate, I also reflected on my time, a few years back, as chair of the Kids in the Middle coalition of children and families charities and agony aunts, which campaigned for better support for separating families and, in particular, children caught up in parental conflict. In its day, the coalition had direct access to Prime Ministers and Secretaries of States of various hues.
My starting point in these debates has always been the need to provide more support to children embroiled, through no fault of their own, in the middle of serious and damaging parental conflict, and the pressing need for a stronger voice for children in the family courts. We know, and have already heard, that the quality of the interparental relationship has a key impact on children’s long-term mental health and future life chances—in other words, this all really matters.
The majority of separating parents come to an agreement on their own, or with minimal help from relatives and others. Only a minority need extra help, either to come to an agreement outside of court or through the family courts, but there is widespread agreement that this process is just not working properly. Far too many parents find themselves caught up in lengthy court proceedings, which are costly both to them and to the state, and which have a damaging effect on their children.
At a time when the family courts and the judiciary are suffering from a lack of resources and huge backlogs, and as the Government rightly looks to divert family matters away from court where that is safe and possible, I am convinced that early legal advice is critical. It helps people understand their legal rights and responsibilities, and understand where court is inappropriate. Conversely, a lack of clear information and guidance means that opportunities are being missed to resolve arrangements for children earlier. We must move away from a situation where the court is still too often seen as the first port of call and towards it becoming regarded as the last resort.
Respondents to the Government’s consultation last year on supporting earlier resolution of private family law arrangements pointed to a lack of early information and advice leading to disputes escalating, with individuals applying to court without a proper understanding of alternative ways to resolve disagreements, or of the court process. This was also the conclusion of the Select Committee reviewing the Children and Families Act. We argued strongly for the need for early legal advice, as many others have. It is far better to help couples make informed choices to find the route that gives them the best chance of reaching constructive and lasting outcomes on key issues such as family finances and the arrangements made for children. This may be a non-court based approach—sometimes mediation but sometimes other forms of dispute resolution, such as arbitration, collaborative law, solicitor negotiation or therapeutic mediation.
I am also strongly of the view that there should be earlier, easier and possibly even statutory access to co- parenting programmes before an application to court can be made, unless it is not safe to do so. While a co-parenting programme and a MIAM—a mediation, information and assessment meeting—are clearly different, I do not really see why only one, the latter, is compulsory before an application can be made. I was totally persuaded of their value, having sat in on several such separating parent programmes with separating parents present; they pretty much saw the scales falling from their eyes, along with some tears, as they started to understand the impact that their high-conflict behaviour was having on their children. Indeed, I remember one family judge telling me that these should be showing on a permanent loop in the entrance to all family courts. Will the Minister update me on what is happening on both in-court and pre-court parenting programmes?
Mediation can of course help to divert cases from court, helping parties to reach settlement and limiting the burden on court time. However, in some cases mediation is not appropriate. Some couples have genuinely intractable disagreements which require court intervention to settle. I have always been concerned with the Government’s single focus on mediation as a way of reducing the backlog. It sometimes seems as if that is to the exclusion of all other forms of dispute resolution.
My Select Committee, after looking at all the evidence received, was clear that MIAMs had sometimes been ineffective and had low take-up. We concluded that the single focus on mediation, combined with no requirement for the respondent to attend, sometimes coupled with the perception of MIAMs as a form of relationship counselling, had hampered their success. Instead, we felt that many couples would benefit from a source of clear, impartial information on separation, and, if necessary, general legal advice, which could direct them to non-court or court-based resolutions as appropriate.
In our report, we urged the Government to reconsider their proposals to make mediation effectively obligatory. Instead, we recommended that MIAMs and the mediation voucher scheme be replaced by a universal voucher scheme for a general advice appointment, at which point individuals can be signposted to alternative dispute resolution mechanisms, which could of course include mediation. We were particularly swayed in our view by the evidence of the former President of the Family Division, Sir James Munby, and the current President of the Family Division, Sir Andrew McFarlane, who both argued compellingly that mediation was not the only non-court solution. Who knows better than them?
We also recommended that the Government urgently evaluate the impact of the removal of legal aid from most private family law cases, considering where reinstating legal aid could help improve the efficiency and quality of the family justice system. The noble Lord, Lord Bach, and I were very grateful to the Minister for meeting us last March so that we could explain our proposals to him.
Obviously, quite a bit has happened since then, including the Government’s consultation and the subsequent package of measures in their reform programme announced in January this year. We have also had Resolution’s Vision for Family Justice. Most of this I welcome, particularly the focus on helping families to resolve their disputes earlier and without needing to go to court. But I still feel that our central conclusion was the right one: mediation is not helpful or appropriate in all cases; compulsion, in my experience, rarely leads to a good and sustainable outcome; and there are other forms of dispute resolution which will be more appropriate for some. In short, I simply do not believe that a one-size-fits-all approach works. What would make a real difference, I think, is publicly funded early legal advice.
I strongly believe that the private family law system, for those who still need to come to court, should be more investigative and less adversarial, placing the voice of the child at the heart of proceedings and providing additional support for those parents and carers who need it most. Thus I welcome the fact that, in 2022, the Ministry of Justice began piloting a more investigative approach to private law proceedings, in Devon and North Wales. I am encouraged to read that the initial feedback from the pilots suggests that the child impact report helps to focus the proceeding on the needs of the child, allowing the court to focus on the core issues for the child and their welfare, rather than the wider disputes between the parties. To me, that is the very nub of the matter.
Can the Minister give a brief update on the progress of the private law pathfinder models that I have just referred to, as well as on the proposed early legal advice pilot for separating parents, which I know were contained in the reform package? I do not think that they have started yet, but he might be able to correct me on that.
Finally, I want to mention the very important role of family hubs, to which the noble Lord, Lord Farmer, referred. They can have an important role to play, providing good signposting to relationship support and other sources of information and support for separating families. Indeed, I know that some in the sector are calling for family hubs to play an enhanced role in initial triage, with the hub, in essence, becoming the standard first port of call. I for one feel that we should be keeping an open mind on that.
Baroness Meyer (Con)
My Lords, I thank the noble Lord, Lord Farmer, for calling this debate. I am quite disappointed that so few people are here to speak on such an important issue.
I welcome the Government’s reform to help families resolve disputes faster and protect children from lengthy court cases. The programme of measures allowing separating parents to get information, support and early legal advice will no doubt help parents reach an amicable settlement without going to court. It will also alleviate pressure on family courts and free up time for families who really need the court’s intervention.
One of the most pressing issues facing separating families is the time it takes from when the application is lodged to the first hearing and the subsequent proceedings. Not only are lengthy proceedings detrimental to parents’ relationships but they deeply affect children. Research has consistently shown that children suffer profoundly when their parents’ relationship breaks down. Responsible parents will try to ensure the healthy development of their children, which includes regular contact with both parents and their extended families. Sadly, this is not always the case, and the longer the proceedings, the greater the likelihood of parents becoming entrenched in their position, often egged on by their lawyers, who focus on “winning” rather than resolving the case quickly.
As tensions rise, some parents will, consciously or not, transfer their anger and resentment on to the child. Those children will thus find themselves caught in the middle of an ongoing war between the two people they love and need most. Most children will seek the road of least resistance, and rather than face the consequences of speaking out they will simply become the mouthpiece of that parent.
The process of turning a child against the other parent can happen particularly quickly if the non-resident parent is denied or has limited access to the child. I speak from experience: it took only three and a half months under the father’s exclusive control for my eldest son, aged nine, to greet me with kicks and punches the first time he saw me again in a German court. It is therefore essential that children’s fundamental right to maintain a relationship with both parents is maintained—barring exceptional circumstances, of course, but I am not talking about those.
The longer the non-resident parent is absent, the more the damage to the relationship. Can the Minister therefore consider introducing a time-limit requirement for dealing with family court proceedings similar to the statutory limit of 26 weeks for public case proceedings? Would he consider providing clear guidance on court-ordered interim contact, even if it needs to be supervised to counter the negative effect of delay?
It is also clear that all adults, whether female or male, who are victims of domestic abuse must be protected by law. All claims must be considered, particularly as some can be life-threatening for the victims and even for their children. I applaud the work that has been done not only to highlight this issue but to ensure better protection for victims, many of whom live in fear for their lives.
Fifteen years ago, domestic abuse was raised in only a minority of cases. Today, it is raised in 80% of them. Clearly, these claims lead to lengthy proceedings and to the involvement of the police as well as other agencies, but they also lead to more children finding themselves caught in the middle of serious allegations and counterallegations concerning their parents. Does the Minister believe that this is the result of a more violent society, or is it the positive reflection of victims feeling that they can finally be protected? Might some of those claims be the consequence of the LASPO Act 2012, which removed the right to legal aid in family courts unless there was an allegation of domestic abuse? Or is it simply due to a lack of sanction for making false allegations, which may have become a tactic to deny contact to the non-resident parent? Can the Minister tell the House whether the pathfinder project has resulted in accusations of domestic abuse being dealt with promptly, thus avoiding further trauma to the victims, and whether the pathfinding hearings, in which parents are pitted against each other, have put children under undue pressure?
Cafcass officers are experienced in recognising whether a child’s view is genuine, but can the Minister tell the House whether family court judges have received proper training to recognise whether the “voice of a child” is truly his or hers, and not the result of pressure from one of their parents?
The truth is that children are not necessarily best placed to speak about what is in their best interests. Some will not be able to express their own views, either because they have been coerced, or because they feel guilty, or because they are scared of the consequences of speaking out, while others will be so indoctrinated that they may genuinely believe that they were, for example, sexually abused. While I warmly welcome the Government’s commitment to safeguarding the well-being of children caught in the crossfire of parental discord, I want to put it on the record that parental alienation—the coercive control of children by one parent against the other—does exist. I have raised this in the House several times, and I am not alone in doing so.
Children are vulnerable and can easily be used as weapons, whether by a mother or by a father. Some do so subconsciously, but others do so for their own interest, while it is actually and ultimately the child who pays the price.
I know what I am talking about; I have lived through this experience. Through the charity I have run, I have seen many cases and the long-term consequences on children who have been affected. So please listen to what I have to say, not only to others who think they know best but who feel that it is a vendetta of men versus women. This is about children.
The Lord Bishop of Derby
My Lords, I am grateful to the noble Lord, Lord Farmer, for bringing this debate on this important matter. As I hope noble Lords will know, the Archbishops’ Commission on Families and Households—with which I know the noble Lord was engaged—looked at this subject closely. It is out of this commission that I want to speak this evening. During the commission’s work, the Divorce, Dissolution and Separation Act became law. Opportunities could be taken through that legislation to ensure that couples separating and considering separating—and their children—are made aware of all the support that could be available to them. Surely this is an area in which pastoral concern must feature heavily, both in our policy-making and in our application of legislation and guidance.
As the Family Justice Review found more than a decade ago, too many families whose relationships disintegrate end up in the court system. While the creation of a single unitary family court was a step in the right direction, there is still much work to do, not least in reducing delays in the family courts. As we have heard, the removal of legal aid for separating couples, except where there are allegations of domestic abuse or where a child is at risk, means that couples may not receive the advice and support they need. The continued availability of family mediation vouchers is welcome but is not necessarily a substitute for the vital legal aid that could be in place.
There is much to be affirmed in the Government’s ambitious package of reforms announced earlier this year, many of which reflect the commission’s recommendations. We hope the enhanced focus on conflict resolution and children’s welfare will enable separating families to access the right information at the right time. Piloting the funding of early legal advice for parents—to help them understand the options available and how to access professional support, and encourage them to reach agreements amicably—is especially welcome.
Despite the high divorce and separation rate, there remains a taboo around relationship breakdown. Such a situation—divorce and separation—is never easy, and we trust that it would not be the first resort for any couple experiencing relationship difficulties. For some, the introduction of no-fault divorce has ended their need as separating couples to apportion blame for the breakdown of their marriage or partnership. This has the potential to reduce animosity and increase the chances of more amicable discussions, particularly around future arrangements for children.
By approaching this subject with openness and providing appropriate support, we may perhaps save relationships, as well as softening the impact for anyone in families where relationships do end in separation. As we have heard again this evening, when parental separation does not occur amicably, the negative effects of continued conflict on children can last a lifetime.
I will draw my brief remarks together this evening by focusing on just one of the commission’s recommendations: that children whose parents are separating need clear, age-appropriate information about the process and to be kept informed throughout. The commission heard that they do not want to be kept in the dark. The evidence is clear that children and young people welcome the opportunity to have their voices heard during the divorce process. The commission also heard from children whose parents have separated that the processes for them should have been—and that their desire for children in the future is that the processes are—transparent, informative, respectful, inclusive, safe and child friendly.
What are the Government doing to monitor how changes in legislation and process are enabling those outcomes for children caught up in this? How are we monitoring that children have access to information that enables the processes in which their families are involved to be transparent, age-appropriately informative, respectful, inclusive and safe? The extension of pathfinder courts may be one example of how this can be done, working with adults and children in a multiagency approach, but what else might work in different circumstances?
Surely the best interests and well-being of children are paramount. I encourage the Government to continue their focus on this important area and consider ways of supporting all involved—particularly the children—through this difficult life transition.
Lord Davies of Brixton (Lab)
My Lords, I rise to speak in the gap having heard what has been a powerful and interesting debate—short on numbers but strong on substance. I have a very narrow point to make. On the general debate, the connection between cause and effect is very difficult to establish in this sort of environment. You cannot undertake research with controlled trials; you do not know what the counterfactual is. So one should not leap to conclusions about cause and effect.
As I said, my point is very narrow. It is on pensions. Part of the process is a straightforward and pain-free process of reaching a financial settlement that does not lead to more pain than is required. The law is clear on pension-sharing on divorce but, in practice, it is not implemented to the extent required, because of lack of knowledge and the complications involved.
More work is required to simplify the process. I know that the Institute of Actuaries, of which I am a member, is undertaking work in this area. While we have this opportunity, I stress to the Minister that this is one of the issues that need to be clarified as part of the process of making the resolution of family difficulties as straightforward and pain-free as possible.
Lord Ponsonby of Shulbrede (Lab)
My Lords, I first thank the noble Lord, Lord Farmer, for tabling this short debate. As my noble friend Lord Davies said, it has been a very interesting and well-informed debate. Secondly, I thank the noble and learned Lord, Lord Bellamy, for facilitating my recent visit to Bournemouth, where I saw the pathfinder project in action. I remind noble Lords that I sit as a family magistrate, a youth magistrate and an adult magistrate.
The family court system has experienced large case backlogs, delays and issues with judicial capacity for several years now. This includes delays for families and children involved in private law disputes. According to the Government’s latest family court statistics, there were 12,566 new private law applications made to court under the Children Act 1989 in October to December 2023. This was a decrease of 1% when compared to the equivalent quarter of 2022. These new applications involved 18,758 children and it took an average of 46 weeks for private law cases to be closed during this quarter. I agree with what the noble Baroness, Lady Meyer, said: this should be reduced to the public law limit of 26 weeks. That, of course, is a desirable aspiration.
The Government’s LASPO Act signalled the death-knell for family mediation. In 2012-13, there were 31,000 mediation assessment meetings and 14,000 mediation starts. By 2016-17, those figures had fallen to 13,000 and 7,700, which are reductions of 61% and 44% respectively. In 2021, cuts to legal aid led to more people representing themselves in the family courts. From 2013 to 2020, the percentage of cases where neither party had a legal representative almost trebled, increasing from 13% to 36%.
Before applying to court, parents are legally required by the Children and Families Act 2014 to prove that they have considered mediation. Parents can prove this either by demonstrating they have attended a mediation information assessment meeting, or MIAM, with a family mediator, or by showing the court they are exempt from mediation—for example, where domestic violence is involved. It is widely known that long-term conflict between separating parents can have a devastating impact on children’s well-being. The trauma has been linked to increased rates of anxiety, aggression and depression, and other serious consequences.
In January 2024, the Government announced new measures to seek to protect children from the impact of lengthy courtroom battles and had a consultation on their proposals. The consultation respondents said that a lack of free legal advice on family law was a barrier to early dispute resolution. To address this, the Government set out various actions they were taking to ensure that the court process remained a last resort when family disputes arose. This included launching a free family law legal advice pilot in specific regions of England and Wales by this summer, 2024, to see if this could assist families to resolve their disputes earlier. The legal advice pilot will be launched to help families agree child arrangements as quickly as possible, addressing barriers to early resolution. I hope the Minister will be able to update us on when this pilot is going to start.
There is also work with Cafcass, the Children and Family Court Advisory and Support Service, to help more families undertake in-court parenting programmes earlier in the court process, as well as making pre-court parenting programmes the norm for families trying to reach an agreement over child arrangements. The noble Baroness, Lady Tyler, spoke to these alternative approaches, in what was a very well informed contribution to the debate.
The role that mediators can play would be bolstered through improved domestic abuse screening and advanced DBS checks, meaning they have the right to vetting and can support children earlier in the process. This, alongside the existing mediation voucher scheme, which has already helped nearly 25,000 families, will mean more couples can resolve their issues without ever reaching court. I ask the Minister for an update on the voucher scheme and for his response to the proposal by the noble Baroness, Lady Tyler, and her committee to have a wider range of courses which may be accessed through the voucher scheme. Again, I thought that was an imaginative proposal which needs serious consideration.
The Government stated that, for those who end up going through the court process, there has been the Pathfinder pilot scheme, which, as I mentioned, I visited in Bournemouth. I know it is being rolled out further, in Cardiff and Birmingham. It will be very interesting to see how beneficial it is in Birmingham, which is perhaps the most analogous city to London, if the rollout is to go further. I have some statistics from my recent visit to Bournemouth, and I have to say that they are very impressive. They show a large drop in the number of fact-finding hearings between 2022 and 2023. They show a large drop in the number of court reviews, Cafcass reviews and returns, which is where the arrangements break down and the matter comes back to court. The message I got from my visit to the Bournemouth court was that, by Cafcass doing its work early and getting the voice of the child in the report early, it speeds up the whole process. Speeding up the process means that the arrangements are more likely to stick and to be sustainable. The Government have obviously seen the same statistics, and it is right that they are rolling this out. Cafcass really bears the brunt of this improved process, and I hope that there will be money available for it for this process to be rolled out further.
I turn to noble Lords who have spoken in the debate. I recognise the work that the noble Lord, Lord Farmer, has done on family hubs. That is welcome in as far as it goes, and I listened with great interest to what he said.
I listened to the noble Baroness, Lady Tyler, who has great experience—I would say unparalleled in this House—on these matters. She spoke about seeing scales fall from the eyes of parents when she sat in on various programs. I think it must have been a separated parents information program—she is nodding her head. I have done that program as well; it was part of my original training. I have to say that, although I have seen and heard about the same thing, unfortunately what I see in court is where it has not worked, and the battle lines are more entrenched. Although we try to break down those battle lines, nevertheless some couples, unfortunately, want to fight their battles in the court. I recognise the point she made about the influence of Sir James Munby and Sir Andrew McFarlane, and how they want to try to keep private law cases resolved outside court where possible. That is very often a better way.
I remember the speech the noble Baroness, Lady Meyer, gave a number of years ago during the passage of the then Domestic Abuse Bill and her very compelling advocacy for the importance of parental alienation. I have to be frank here. I hear these accusations in court fairly regularly, and as a lay magistrate I send them up to a higher level of judiciary. This is a fraught and very difficult subject. It needs to be handled with a great deal of care, and—I will use the word—a little scepticism. I can see the noble Baroness shaking her head, but we have these allegations made fairly frequently and we have to find an appropriate way of dealing with them.
The right reverend Prelate the Bishop of Derby spoke about the Church of England Commission. One recommendation she spoke about was the need for child-appropriate information to be made available. I do not know whether she is aware, but Cafcass runs a children’s group which informs children going through the process. They are extremely impressive young people; they have presented to family magistrates more than once. It is a very good way of informing children, by other children who have been through the process.
This has been an interesting debate. My noble friend Lord Davies raised an interesting point on pensions. I look forward to the Minister’s response to the questions raised.
The Parliamentary Under-Secretary of State, Ministry of Justice (Lord Bellamy) (Con)
My Lords, few subjects can be more important than the one we are discussing this evening, and I rather doubt my ability to do justice to everything that has been said in the 12 minutes allotted to me. I thank my noble friend Lord Farmer for his opening remarks and for securing this debate, and all noble Lords who have spoken. I think we are all agreed that family separation can be extremely stressful and very damaging to the children, particularly if there is a prolonged period of lack of contact, as my noble friend Lady Meyer pointed out. In those circumstances, the Government are actively supporting, and improving support, for parents considering separation, and are adopting a number of measures to promote early resolutions.
The best approach is probably if I update the House on what we are actually doing, following our response published on 26 January to our earlier consultation on early resolution of family disputes. What the Ministry of Justice is doing, of course, is in addition to other work across government, including the rollout of family hubs. Again, I pay tribute to my noble friend Lord Farmer in this respect. Family hubs are led by the Department for Education. There is also funding from the Department for Work and Pensions for local authorities to deliver the Reducing Parental Conflict programme.
The House will have heard in the recent Budget that the Ministry of Justice has been awarded a further investment of £55 million, specifically for the family courts. That comes, basically, in three buckets—if I may say so. The first is one that a number of noble Lords, including the noble Baroness, Lady Tyler, have mentioned. I pay tribute to her, not only for her distinguished past as a former chair of Cafcass and in other respects, but for the post-legislative scrutiny carried out in relation to the 2014 Act, from which we have all greatly profited. However, the three buckets are, first, greatly improved, facilitated, targeted online guidance and information, so parents know where to go and can find out, at a very early stage, all the sources of support out there. There are quite a lot of sources of support, but no one can find them or knows about them—they are not joined up. The first part of the funding will be for a new online resource that will serve as a trusted and accessible source of authoritative information, relevant to the needs of the family and the needs of the parents, providing options—which will include mediation, but not only that because there are other forms of dispute resolution away from court—with the support of guidance and expert organisations in the third sector.
To deal specifically with one of the points raised by my noble friend Lord Farmer, I say that I am quite sure that links between this programme and the family hubs will be an important aspect of it—family hubs among other means of support. Indeed, if the present process for online divorce does not refer people across to the appropriate support facilities, then it should. That is another very important area, and I am very grateful to noble Lords for drawing our attention to it. Specifically, just as we have been discussing in another context a child-friendly version of the victims’ code, I would have thought that a child-friendly part of this newly available information was a specific emphasis on how we keep children informed, not only about what is happening in their case, but the general availability of support for them. As the right reverend Prelate the Bishop of Derby suggested, I am sure that would also be important.
I am hoping that this will be a major step forward in how we intervene as early as we can in family disputes, combining it, as I say, with the DWP’s Reducing Parental Conflict programme, the family hubs and other programmes that a number of local authorities are already running to support separating couples—or, indeed, couples who have not yet separated but who are going through a difficult patch, which is to go back to an even earlier stage.
We are championing the family hubs that the noble Lord, Lord Farmer, has been such a keen advocate of. There is around £300 million to develop family hubs in 75 upper-tier local authorities. There are now around 400 family hubs altogether, and there is further support for opening further family hubs in another 13 local authorities. That is an ongoing programme, and I hope that it will come to full fruition, in collaboration with the kinds of things that I am trying to explain from the point of view of the Ministry of Justice.
In addition, the second bucket of our new funding is indeed to tackle this point about early legal advice, which is so important and was raised by the post-legislative scrutiny committee and a number of others. What we are doing is piloting; government being what it is, you have to pilot these things these days—you cannot go straight towards just doing it. It is important to learn from the pilot how to do things. I shall come back to that point in the pathfinder context.
The purpose at the moment is to expand, with the additional money that we now have, a pilot for early family legal advice, probably initially in six areas. As noble Lords probably remember, we have 43 areas across the country that have a designated family judge in charge. We can now go to six areas initially; the details are being worked out, but I am hoping that this will be up and running by the autumn. By September we should have something in place. It will be very important, among other things, to promote it and make sure that people know that it is there and that they can access it easily. We had a pilot in the ministry a couple of years ago with support in family housing, which did not work because nobody knew that it was there so nobody used it. It was in Middlesbrough, and possibly Manchester, but it was not successful, so I am very conscious that we have to sell this as well as establish it, and those details are being worked through at the moment.
That is early legal advice. Then there is the diversion when people have had early legal advice, which may lead to more referrals to mediation, or other forms of court dispute resolution. We are continuing to support the voucher scheme for mediation; that demand has been strong, with 27,000 families so far, and has cost £23 million or so. By March 2025, we think that 44,000 families will have used the scheme, so that will continue to support mediation—and, at the same time, we are working closely with the Family Procedure Rule Committee to make the mediation information and assessment meeting, which has been mentioned, more effective. The new rules come into force on 29 April, next Monday. I hope that that will prevent MIAM from being, as it had become in some areas, a tick-box exercise.
Ah, the lights have gone out; I must have said something very controversial. I still have enough light to carry on.
That provision is proceeding, as are pathfinder courts. We of course support Cafcass, but those courts focus on the voice of the child. We have an early child impact report, we have support from domestic abuse agencies, we have a case progression officer and we have other things. It has been notably successful in reducing strife and the Government’s intention now is no longer a pilot, it is a project, and we are going to roll it out across the country. We have done Dorset and north Wales, we are doing Birmingham and Cardiff, but I am pressing very hard for a plan so that we change it across the whole country over the next year or so. My Whip is telling me to sit down, although I am trying enthusiastically to carry on. I will write to those noble Lords whose questions I have not been able to answer in the very limited time I have.
The President of the Family Division describes the pathfinder as the most important change in private family law that we have had for a generation, and that is going to be a very good thing and the right note to end on.
Lord Roborough (Con)
My Lords, we will now adjourn again to wait for a message on the Rwanda Bill. We will resume at a time to be shown on the Annunciator.
Safety of Rwanda (Asylum and Immigration) Bill
Monday 22nd April 2024
(3 weeks, 5 days ago)
Lords ChamberRead Full debate Safety of Rwanda (Asylum and Immigration) Act 2024 View all Safety of Rwanda (Asylum and Immigration) Act 2024 Debates Read Hansard Text Watch Debate Read Debate Ministerial Extracts Amendment Paper: Commons Consideration of Lords Message as at 22 April 2024 - (22 Apr 2024)
Lord Sharpe of Epsom
That this House do not insist on its Amendment 3J, to which the Commons have disagreed for their Reason 3K.
The Parliamentary Under-Secretary of State, Home Office (Lord Sharpe of Epsom) (Con)
My Lords, this Bill has now been scrutinised a number of times. The Government have rejected this amendment several times, so we must now accept the will of the elected House, bring the debate on this last amendment to an end and get this Bill on to the statute book. Having now debated this issue on so many occasions, I will not repeat the same arguments but reiterate a few key points. The Bill’s provisions come into force when the treaty enters into force, which is when the parties have completed their internal procedures. We will ratify the treaty in the UK only once we agree with Rwanda that all necessary implementation is in place for both countries to comply with the obligations under the treaty.
I have set out the steps that have been taken to be ready for the treaty to be ratified, and I will remind noble Lords once again of the most recent step. Last Friday, 19 April, the Rwandan Parliament passed its domestic legislation to implement the new asylum system. Rwanda has a proven track record of working constructively with domestic and international partners, including the UNHCR, the International Organization for Migration and other non-government organisations to process and support asylum seekers and the refugee population. As I have already set out this evening, the Government are satisfied that Rwanda is safe and has the right mechanisms in place should a situation ever arise that would change that view. The Government will respond as necessary, and this will include a range of options to respond to the circumstances, including any primary legislation if required.
The monitoring committee will undertake daily monitoring of the partnership for at least the first three months to ensure rapid identification of, and response to, any issues. This enhanced phase will ensure that comprehensive monitoring and reporting take place in real time. During the period of enhanced monitoring, the monitoring committee will report to the joint committee in accordance with an agreed action plan to include weekly and biweekly reporting, as required. The implementation of these provisions in practice will be kept under review by the independent monitoring committee, whose role was enhanced by the treaty, which will ensure compliance. I beg to move.
Lord Anderson of Ipswich (CB)
My Lords, Amendment 3J in my name turned out to be the last one standing. Perhaps I may say just a few words at its funeral. It was not much, perhaps, compared with some of those amendments that had already been defeated. Indeed, it survived so long under the guidance of the noble and learned Lord, Lord Hope of Craighead, who I am delighted to see back in his place, precisely because it was so modest and unthreatening to the Government’s policy. But it at least touched on a central disease of this Bill and perhaps of our body politic more generally: the imputation of decisions to Parliament to reduce the possibilities for challenge and the pretence that by asserting something to be true, even in the teeth of the evidence, one can not only make it true but keep it true for ever.
Many people, some of them perhaps still watching even now, will have wished us to keep on fighting, but without the threat of double insistence—which remains part of our constitutional armoury, but which did not command the necessary political support on this occasion—there would have been no point in doing so. The purpose of ping-pong is to persuade the Government, through force of argument, to come to the table and agree a compromise. They have refused pointedly to do so, and after four rounds of ping-pong, their control of the Commons remains as solid as ever.
The time has now come to acknowledge the primacy of the elected House and to withdraw from the fray. We do so secure at least in the knowledge that the so-called judgment of Parliament was not the judgment of this House, and that we tried our hardest to achieve something a little more sensible. We must take comfort from such assurances as the Minister has been able to give and hold the Government to them. This is the Government’s Bill, resolutely free of any outside influence. As a patriot, I can only hope—though I am afraid, without much optimism—that it will bring benefits, in some way, commensurate to its real and painful cost.
Baroness Bennett of Manor Castle (GP)
My Lords, I rise with a heavy heart, given the lack of further amendment, to this dreadful, international law-busting Bill. I note that in the other place, the SNP twice used procedural Motions to delay it by 15 minutes each time. I applaud them for that, and I am not going to take up the same length, but I am going to take a moment to mark this historic occasion.
Your Lordships’ House has put a lot of work into trying to make the Bill comply with international law, with basic moral laws and with the principles of justice and fairness. The noble Lord, Lord Anderson of Ipswich, earlier today said:
“Its costs will be measured not only in money but in principles debased—disregard for our international commitments, avoiding statutory protections for the vulnerable, and the removal of judicial scrutiny”.
Nothing has changed in the Bill in the last few hours.
I note that Amnesty International this evening warned airline companies that many members of the public take an extremely negative view of the content of the policy. Those were really unnecessary words, because no company of any repute whatsoever is going to take part in implementing this dreadful policy. That is a measure of the Bill and the disgraceful, despicable actions it represents.
I am disappointed to see the almost empty Benches around me. I note that the Liberal Democrat Benches are here, having played their part in trying to stop the Bill at Second Reading, and I commend them for that action that the Green group supported. They are still here to the bitter end.
We heard from the Minister, we will hear tonight, and no doubt will keep hearing in the coming days that “Well, we’re the unelected House”. That does not mean that this House is without moral or legal responsibilities. I have asked the House a number of times: if not now, when? What will it take to make this House say, “Here we take a stand”?
We have had the abomination of the Elections Act, the elements of a policing Act that targeted Gypsy, Roma and Traveller people explicitly. We have had multiple indefensible restrictions on the right to protest. Now, we are letting through an attack on some of the most vulnerable, desperate people on this planet. What more will we let through? I suggest to noble Lords as they leave this Chamber tonight to ask themselves that question.
With a desperate, flailing government party bereft of ideas and philosophy and without principles, this House will keep being tested. I ask these empty Benches: you might be waiting for an election, but what kind of a country will it be if you do not stand up now?
Lord German (LD)
My Lords, we recognise the resolution and strength of this House in how it has worked on the Bill. That is not to suggest for one moment that this House has changed its view; it is simply that we have had to recognise that the other House has the elected ability to override whatever we wish. However, the Bill’s outcomes are still to be discussed and debated.
The Minister, at least three times during the last three sessions here, said that the Government will not ratify the UK-Rwanda treaty until
“all necessary implementation is in place for both”
the UK and Rwanda
“to comply with the obligations under the treaty”.—[Official Report, 17/4/24; col. 1033.]
Given the position that this House has taken, it seems to us that it would be very valuable indeed, whenever the Government are prepared to sign the treaty, to have an opportunity to debate it in this House. Will the Minister acknowledge that, and give Parliament and this House an opportunity to discuss these matters when the opportunity comes up? We assume that will happen in the next 10 to 12 weeks, because that is the timetable that the Government have set themselves. Therefore, these matters will be very important to the House, which has grave concerns about the issues that have been debated here many times.
Recognising that we are at the end of this route of the legislation does not mean that we are at the end of the debate that we must have on the manner and objectives that the Government have set for themselves. To put those under more scrutiny, it would be most helpful indeed if the Minister could grant us time for that debate.
Lord Coaker (Lab)
My Lords, these are the final stages of the passage of the Bill. It is not a Third Reading, but I again thank the Government Front Bench, including the noble Lord, Lord Sharpe, the noble and learned Lord, Lord Stewart—who is not here; I cannot see him anywhere—the Government Chief Whip, the Leader of the House and others, for the way they have conducted the proceedings of the Bill overall. It has been very much appreciated.
Although we fundamentally disagree on the Bill—the Government will now own the Bill and see how it works—I am somewhat reassured by the process that has been undertaken, unlike the noble Baroness, Lady Bennett. As a result of what we have said—and contrary to what the Prime Minister said at the beginning of the Bill’s passage, which completely dominated our discussions for much of the time—the Government have amended the Bill. It would be extremely helpful to the Government Front Bench here, and others who may be listening, to recognise that the House of Lords has a role to play. It is perfectly appropriate for the Lords to delay legislation and to say that we think the Government should think again—and even think again twice. If it had not been for us demanding that the Government think again three or four times, my noble friend Lord Browne’s amendment would not have been passed. Given the importance that everybody in this House attributes to his amendment, I would have thought that was cause for reflection on how well this system works. When I was in the other place, I saw that it irritates the Government. They feel that their elected mandate is being overridden, but actually—except in very exceptional circumstances—that does not happen.
I am sorry to reiterate this point about process, but it is really important. I do not know how many times, but I have said numerous times from the Front Bench that we will not block the Bill, as have my noble friends Lord Kennedy and Lady Smith, the leader of our party in this place. Yet we see consistently from the Prime Minister, including today, claims that Labour Peers in this place seek to block the Bill. I hope—I am not sure—that noble Lords opposite will come to this side of the House and that we will go to that side. If that happens, I hope that, when we put forward various pieces of legislation to do with trade union rights, for example, and all the other Bills that we have suggested, noble Lords will remember that the role of the House of Lords in those circumstances will be to challenge the Labour Government who I hope will come into place but not seek to block or undermine the elected will of the people. That is not what we have sought to do.
I hope the serious point that I am making about the way the political system operates in this country will be a cause for us to reflect that, in respect of this Bill, although we fundamentally disagree with it, that system has worked reasonably well, and I look forward to that happening again in the future.
The Lord Privy Seal (Lord True) (Con)
My Lords, if I might intervene briefly and ask my noble friend for indulgence, I should say that the noble Lord opposite made important remarks. This House has a major and abiding role in asking the elected House to think again. But as he said, we are now four times into this process. This House is at its best, as he again implied, when we have dialogue, understanding and tolerance across the Chamber. We have heard the words “patriotism” and “morality” used—not by the noble Lord opposite. In my experience as Leader of this House, this is a patriotic House, whatever the party and whatever the person. This is a House where people of different political views, with a high political morality of public service, have different ways of seeking to achieve the same end. The party opposite wishes to repeal this Bill; I hope it will, shortly, be passed.
I have said this before on other occasions, and I am sorry; I crave the indulgence of the House at rising at this, but it is an important point. It is important that we have a discussion about what are the limits and what is the place of your Lordships’ House in scrutinising and indeed challenging legislation put forward by any elected Government. However, he embers of the passage of this important Bill, which I understand was controversial in this House, are not the occasion. I do not think this is the place, but this is a matter that we might debate in an open forum and privately, and I hope that we can do that.
I appreciate the gentle way—in the sense of gentlemanly, if that word is allowed to be used in this way—in which the noble Lord has put the point. I appreciate his tribute to my noble friends and others on the Front Bench, and indeed to all the people in this House. There have been spirited and good debates, in the best traditions of the House, but in the weeks and months ahead we must reflect on whether sending something back to the elected House four or five times is the best way to enable the King’s Government to be carried on.
Lord Purvis of Tweed (LD)
Perhaps the Leader might reflect on the point that my noble friend Lord German made. The Minister, this evening and previously, has said that the Government currently are not in a position to ratify the Rwanda treaty because they are not in a position to state that the conditions that would be required to ratify the treaty are yet in place. That assumes that a process will have to be under way for the Government to ratify that treaty, of which we are currently unaware.
The Leader speaks very sincerely about our ability to scrutinise and to hold the Government to account for decisions that they make, especially when it comes to international agreements. Given what the Minister said—I repeat, that the Government are currently not in a position to ratify the treaty—will the Leader ensure, through the usual channels, that there is open discussion about facilitating time in this Chamber for us to discuss what the Government’s statement would be when they come to the conclusion that those requirements for the treaty are in place? Surely that is simply an open way for us to scrutinise the decision that would be made if the conditions are met.
Lord True (Con)
My Lords, I hope it is in scope for the Leader of the House to interpose his body, particularly when the noble Lord is active and spirited, as he is at this hour. I will say two things. First, we have had many hours of debate on this legislation. I think the doubts about the Bill, and we believe the beliefs and proprieties about it, are entirely clear. So far as further discussion and the development of events are concerned, we in the usual channels are always open to discussion with other parties about when or in what way further discussion can be made. I apologise to the House for my intervention but these are important things which we need to reflect on. Perhaps this has been a prolonged process, but I would like, in the immortal phrase of the Senate of the United States of America, to yield the floor to my noble friend Lord Sharpe to conclude the proceedings.
Lord Sharpe of Epsom (Con)
I thank my noble friend for his intervention. He put his points across extremely eloquently, and I agree with all of them.
I say gently to the noble Lord, Lord Anderson, and the noble Baroness, Lady Bennett, that the Bill does comply with international law. It is profoundly moral and patriotic to defend the integrity of our borders, and it is profoundly moral and patriotic to prevent the needless loss of life in the channel and to put the criminal gangs out of business.
I also ask the noble Baroness, Lady Bennett, why the Green group is currently a solo act. Where is her partner?
Baroness Bennett of Manor Castle (GP)
I have been asked a direct question. I am sure the House would have been delighted to hear from both of us this evening, but we made a choice to have one representative. If the House would like to hear and see more of us, we would welcome being invited to do that.
Lord Sharpe of Epsom (Con)
Speaking personally, I would rather hear a lot less, but there we are.
Rwanda is a safe country that has proven time and again its ability to offer asylum seekers a safe haven and a chance to build a new life. Rwanda has a strong history of providing protection to those who need it and currently hosts over 135,000 refugees and asylum seekers, who have found safety and sanctuary there. Binding provisions in the treaty place obligations on the Government of Rwanda to provide for those relocated under the partnership, and this is long overdue. I put on record my thanks to officials in the Government of Rwanda for all their efforts in delivering this partnership. I commend the Motion to the House.