European Structural and Investment Funds and the European Agricultural Guarantee Fund
Debate between Lord Jones and Baroness Penn(1 year, 1 month ago)
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Baroness Penn (Con)
My Lords, as I have explained to the House, as European funding tails away, UK funding ramps up. For example, the shared prosperity fund will reach £1.5 billion a year by the end of the spending review period. For each of the sectors that the noble Baroness mentioned, we have provided clarity around the funding available for the full three years of the spending review and the mechanisms by which it will be distributed. I know that my colleagues in Defra continue to work hard with farmers to ensure the successful rollout of the replacement schemes.
Lord Jones (Lab)
My Lords, will the Minister acknowledge that, in recent times, Wales has lost a great foundation industry, which was mining? It provided tens of thousands of jobs and created some prosperity. In recent times, the once mighty steel industry of Wales has also all but disappeared—it has shrunk. We are more and more in need of investment. It was from the privy counsellors’ Bench over there that former Prime Minister Harold Macmillan, Viscount Macmillan, paid tribute to the miners and steelworkers who, in two world wars, defeated first the Kaiser and then Adolf Hitler. Wales now needs more and more government funding. In the lovely heartland of Wales—cefn gwlad—there is great distress among the farming communities. We are in need of investment.
Baroness Penn (Con)
My Lords, we had a discussion last week about the needs of Wales when it came to government funding. I told noble Lords then that we took into account the greater needs of Wales as calculated by the Holtham commission. Indeed, the funding that goes to Wales is over and above the assessed needs of Wales at the present time.
Farmers and Landowners: Tax Consequences
Debate between Lord Jones and Baroness Penn(1 year, 5 months ago)
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Baroness Penn (Con)
My Lords, we are iterating our approach as we develop these schemes. Quite a lot of them are new, and many different aspects are being piloted or developed. It is important that, as development happens, we take into account the tax considerations and implications of the new schemes. I can reassure noble Lords that we are aware of some of these questions and issues. We are looking at them very closely and, as the policies are developed, we are taking that into account in the Treasury’s input into Defra schemes.
Lord Jones (Lab)
My Lords, does the Minister guarantee that her taxation policies will not bear down unjustly and negatively on the upland farming areas of England and Wales? I have in mind the Borders, Cumbria, the Pennines, Cefn Gwlad—the heartland landscape of Wales—and the moorland communities of the south-west. Does she acknowledge that, already, besides taxation, the big problems are elevation and climate, and that these historic communities do not need further problems arising from her department’s taxation policy?
Baroness Penn (Con)
I reassure the noble Lord that we are cognisant of the need to ensure that our tax policy and our environmental land management schemes are working with and not against each other. It is an area of some complexity. With respect to how different farmers are affected—the noble Lord mentioned upland farmers—we are trying to look at the whole system and its different levels of complexity to make sure that we get to the right approach.
Financial Services (Miscellaneous Amendments) Regulations 2022
Debate between Lord Jones and Baroness Penn(1 year, 5 months ago)
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The Parliamentary Secretary, HM Treasury (Baroness Penn) (Con)
My Lords, this statutory instrument comprises two sets of provisions relating to Gibraltarian firms operating in the UK market and to securitisation. The proposed legislation will remedy technical deficiencies identified in financial services legislation that was put in place to help manage our withdrawal from the EU.
In relation to Gibraltar, this instrument will fix temporary market access arrangements put in place to ensure that Gibraltarian firms did not face a cliff-edge loss of market access into the UK when we left the EU. In particular, these amendments will complete the intended transfer of powers to the Treasury and the Financial Conduct Authority in three specific areas. This transfer will give the UK authorities powers in relation to Gibraltarian firms where operating in the UK market, consistent with their powers over domestic firms.
It is worth remembering that financial services legislation was amended on withdrawal from the EU to adjust the treatment of EEA firms; in particular, to remove passporting rights, which were a function of the EU’s single market. At this time, because Gibraltarian firms had benefited from equivalent rights, separate provisions were necessary to preserve the existing arrangements supporting market access for financial services between the UK and Gibraltar. These arrangements were always intended to be temporary. Through the Financial Services Act 2021, we are working to replace them with a new permanent regime designed specifically for Gibraltar that reflects our unique history and relationship.
The temporary regime that the Government put in place for Gibraltarian firms unintentionally prevented the transfer of powers to the Treasury and the Financial Conduct Authority being completed in certain areas, leaving gaps in UK law. This SI will exclude provisions from this temporary regime to remove these gaps in the powers available to the Treasury and the FCA. This is equitable and proportionate, as it will enable the treatment of Gibraltarian firms to be brought in line with that of UK firms. Closing these gaps will provide for a more consistent legal and regulatory environment, as intended.
This SI will have an impact on three regulations that affect Gibraltarian firms operating in our market. Under the Short Selling Regulation, the Treasury’s power to modify the reporting threshold relating to net short positions will extend to Gibraltarian firms trading shares on a UK trading venue. Under the Markets in Financial Instruments Regulation, the FCA will be able to apply technical standards relating to post-trade disclosure obligations to Gibraltarian investment firms in the UK. Similarly, under the Packaged Retail and Insurance-based Investment Products Regulation, the FCA will be able to apply technical standards to Gibraltar firms selling, advising on or manufacturing PRIIPs to retail investors in the UK.
I turn now to the second area the SI covers, securitisation provisions. Securitisation is the packaging up of assets or loans and selling them on to investors. This allows lenders such as banks to transfer the risks of assets to other banks and investors to free up their balance sheets and allow for further lending to the real economy. The UK supports the implementation of international standards to promote simple, transparent and standardised—or STS—securitisations. STS securitisations are easier for investors to understand and assess the risks of. As a result, some STS investors will benefit from lower capital requirements.
Generally, only firms established in the UK can designate their securitisations as STS. However, transitional arrangements were put in place to allow for certain EU STS securitisations issued prior to the end of 2022 to be recognised in the UK. These arrangements were extended to the end of 2024 by another set of EU exit regulations earlier this year. The instrument being debated today will simply extend the end date of two requirements for EU STS securitisations to the end of 2024, rather than 2022. This will ensure that UK investors do the appropriate due diligence checks when investing in EU STS securitisations, and that these securitisations remain exempt from clearing requirements, to prevent unnecessary administrative burden. The amendments thus maintain the current requirements as long as the transitional arrangements last. I beg to move.
Lord Jones (Lab)
My Lords, I thank the Minister for her lucid introduction. I refer to paragraph 7.26 of the Explanatory Memorandum. Will she tell us just how busy Gibraltar firms are? How many of them are there—that is, those that are
“acting as sellers, advisers or manufacturers of PRIIPs to retail investors in the UK”?
Gibraltar is a very small place. We might ask, with regard to the Explanatory Memorandum, what is going on in Gibraltar? There is a plethora of technical terms, a multitude of abbreviations in capital letters and specialist vocabulary, and it is all a blizzard of necessitous complexity, the House might agree. Of course, the Minister is a master of it all and, again, I thank her for her lucid introduction.
Social Security (Contributions) (Amendment No. 2) Regulations 2022
Debate between Lord Jones and Baroness Penn
Baroness Penn (Con)
I thank all noble Lords for their engagement on these regulations, and indulging in what the noble Lord, Lord Davies of Brixton, referred to as a piece of social policy archaeology. It is important that we have been able to bring forward these regulations, and I therefore completely acknowledge the points made by the noble Baroness, Lady Kramer, the noble Lord, Lord Tunnicliffe, and others about the complications in our approach, and the speed with regard to these particular regulations.
Just by way of a bit of a further explanation for this set of regulations, HMRC had previously identified a different legislative vehicle to provide for this measure. However, that legislative vehicle was not a viable option once it had been confirmed that there was no longer sufficient time for scrutiny to take place within the usual timeframe. That was an oversight, and HMRC has moved quickly to prepare this piece of relevant legislation. It is with regret that we had to expedite the consideration for this measure. However, to ensure that the levy is applied fairly, these regulations need to come into force ahead of 6 April. We have written to both the JSCI and the SLSC to explain the reasons for this delay and to ensure appropriate scrutiny.
I heard the point made by my noble friend Lady McIntosh of Pickering, echoed by the noble Baroness, Lady Kramer, about the need to extend this measure to this particular cohort. While that may be debated, when the measure was announced it was included in that cohort, and now payroll and others are expecting it to go ahead. That is why it is important that we have been able to provide for it.
In response to the question from the noble Lord, Lord Jones, about engagement with business, especially small businesses, we have engaged with payroll providers to ensure that the new rates, including the married women’s reduced rate, are updated.
A number of noble Lords asked for further zoning in on the numbers affected. As I said, in 2019 we reviewed the number of eligible women who could apply for this rate and compared this against multiple data sources. We recently conducted a scan of NICs records in the 2020-21 tax year, which looks at around 2% of employees. We found two individuals qualifying for the married women’s reduced rate. Extrapolating from this would suggest that there are currently around 100 cases, but I remind noble Lords that these are not actual figures but estimates. Due to both the fact that this is an estimate and the small numbers involved, it is not possible to break down those affected into England, Wales, Scotland and Northern Ireland, et cetera.
Lord Jones (Lab)
Shall there be an answer to the specific question on numbers, on which I gave a quote?
Baroness Penn (Con)
I believe there were two specific questions on numbers. The first was on the number of people who may be affected by this change. Our best estimate from an updated scan indicates around 100 cases, but that is an extrapolation rather than a specific figure. Secondly, the breakdown for the different nations of the United Kingdom is not possible to provide. Even if I were to write, we would not have that figure.
My noble friend asked whether the increase in the thresholds announced at the Spring Statement will impact state pension entitlement. It will not. The lower earnings limit has not changed, so that is not impacted.
I say to the noble Baroness, Lady Kramer, that this cohort will benefit from the increase in the primary threshold limit announced at the Spring Statement and being legislated for later this week. The noble Baroness also asked about the impact on the NIF. For this measure we would not be able to score it; because of the small numbers involved, it would be classed as a negligible impact. I take her point when she also asked more broadly about the impact on the NIF of the increase in the thresholds. We might come back to that on Wednesday.
I think I have covered most of the points raised in this debate. My noble friend mentioned that she shadowed the Department for Work and Pensions when she was in the Commons. That was also one of my first jobs in opposition. My knowledge does not date back to the 1970s but is certainly a little out of date for a debate on pensions today. I hope I have covered all noble Lords’ questions.