United Kingdom Internal Market Bill

Lord Whitty Excerpts

Committee stage & Committee: 3rd sitting (Hansard) & Committee: 3rd sitting (Hansard): House of Lords
Monday 2nd November 2020 Lords Chamber

[Lord Whitty (Lab) [V]]

My Lords, when the debate on this group of amendments started, it seemed that it would be another round of Westminster versus the devolved Administrations, which is a major theme of the group. Nevertheless, there are other issues.

I added my name to Amendment 166, which the noble Baroness, Lady Boycott, spoke to so ably just now. I also support Amendment 169 in the name of the noble Baroness, Lady Bennett, in principle. Both amendments would correct a glaring omission: the absence of any reference to environmental outcomes in either the Bill and the Government’s earlier statements on a shared prosperity fund or my noble friend Lord Stevenson’s otherwise admirable attempt to set up a shared prosperity commission to administer the framework of financial aid across the four countries of the UK.

In effect, the shared prosperity fund concept is a sort of replacement for the EU’s structural funds and regional funds—probably other funding too—which have hitherto been provided back to the UK by the European Union, largely to level up economic and social well-being and performance across Europe. In principle, I like the concept of such a fund or a commission, which may well be a better home for the administration of that framework than the office for the internal market within the CMA, but I must confess to your Lordships that I do not like the term. I racked my brains as to why. I think that it is somehow a bit redolent of the euphemistic terminology of the Soviet era or, perhaps even more worryingly, of imperial Japanese militarily dominated eastern Asia during the time of the co-prosperity zone in the 1930s and during the war. Neither of those historical examples were ever cited by Brexiteers as preferable to the supposed centralisation by Brussels. If that rings alarm bells for me, no wonder it does for the devolved Administrations. Whatever we do, can we perhaps set up a body such as the one proposed by my noble friend Lord Stevenson, but find a better title?

More substantively, if the UK is to distribute aid to business and others to replace and improve on the benefits of the money that we previously received from the EU—which, quite rightly, disproportionately benefited the devolved nations of the UK and deprived areas in England—we need some objective criteria, constraints and rules surrounding that allocation. We also need an institution along the lines proposed by my noble friend Lord Stevenson. His amendment lists a lot of economic and social criteria that such an award of funds would have to take into account, but there are no environmental criteria.

As Amendment 166 in the name of the noble Baroness, Lady Boycott, indicates, the biggest crisis facing us all is the climate emergency. Our international obligations under the Paris Agreement and national commitments under the budget of the Committee on Climate Change surely mean that future state aid of any sort must advance progress on mitigation of and adaptation to climate change, and certainly not lead to effects that undermine our carbon and greenhouse gas targets or make worse the outcome of our industrial system. To that degree, it needs to be an improvement on the operation of some EU funding to sectors and projects that even I, as a passionate pro-European, recognise were not always done well in the EU—that is, some projects, particularly in eastern Europe, undoubtedly damaged the environmental prospects for Europe as a whole, particularly by favouring the substantial further use of fossil fuels.

It is therefore important that any such criteria are written into the terms of the proposed shared prosperity fund, and the commission must reflect those environmental aims. Indeed, any proposition for state aid subsidy, preferred public sector procurement treatment or clearance for planning permission, whether by the UK Government, a devolved Administration, local government or a quango, needs to have attached to it a clear environmental assessment of the impact on the climate, particularly regarding greenhouse gas emissions.

The noble Baroness, Lady Bennett, takes it further than the carbon figures to cover other environmental dimensions, particularly the protection and enhancement of the natural world. Some of what she refers to may be more difficult to measure than greenhouse gas effects, but in reality, if subsidised projects lead to a deterioration in biodiversity and habitats, as did some European projects under the common agricultural policy, that is a contribution to environmental degradation and in many instances leads directly to increases in carbon, methane and other greenhouse gas effects. We should adopt the concepts in these two amendments before we move any further towards something like the shared prosperity system proposed by the Government.

The negative effects of some government subsidy need to be discouraged by the criteria, but positive investment—in renewable energy and other carbon-saving outcomes, for example—needs to be sustained through this system and written into it. The noble and learned Lord, Lord Thomas, was right to say that Clause 48 in its present form should be deleted, but if we are to provide a substitute it has to be an improvement, and an improvement on my noble friend’s amendment—it has to be greener.

[Baroness Hayman of Ullock (Lab)]

My Lords, I speak in support of Amendment 166, in the name of the noble Baroness, Lady Boycott. It is an honour to follow her, along with the noble Baroness, Lady Jones, and my noble friend Lord Whitty. I also support Amendment 167, in the name of my noble friend Lord Stevenson of Balmacara, and its inclusion of the impact of climate change—particularly flooding. That is an issue close to my heart, living as I do near Cockermouth in Cumbria, which has suffered such devastating flooding over the past 10 years.

As we heard today, and in last week’s debate, Part 6 does not rule out working through the devolved Administrations, but—and this needs repeating—sets no requirements to do so, and enables Ministers to spend money directly in otherwise devolved policy areas.

Right across the world it has been recognised that we have to combat global warming and restore biodiversity. It has been agreed that the next round of European structural funds will have tackling climate change and addressing the just transition as a major theme. In May of last year, Parliament recognised, on the Floor of the other place, that we are in a climate and environment emergency. Last week, in his response to Amendment 52, the Minister said that

“the protection of the environment and tackling climate change are vitally important, and something that the Government are, of course, already committed to.”—[Official Report, 28/10/20; col. 339.]

If the Government are serious about achieving this aim, they need to ensure that where direct financial assistance is given it is consistent with these climate and environmental goals. We need to commit to environmentally sustainable, transparent legislation and policies, and apply them to any future trade deals and relationships, if we are to have any hope of tackling climate change. Whatever the formal future relationship between the UK, its constituent nations and the EU, it is vital that we maintain close environmental co-operation and do not risk undermining it through poorly thought-out legislation. As the noble Baroness, Lady Boycott, explained, Amendment 166 could avoid funding being provided for projects that are not compatible with climate and environmental targets and could undermine these goals.

Funding to support the environment needs to be secure as we leave the EU, because we will lose access to so much. I will give a couple of examples that have not yet been mentioned. The EU LIFE programme for environment and climate action has €3.4 billion to support, among other policies, the special conservation areas in the Natura network. The EU maritime and fisheries fund is a €6.4 billion programme, more than a quarter of which supports projects protecting marine environments, developing sustainable fisheries, and supporting the scientific and data-collection aspects of fisheries management. The concept of sustainability involves operating in a way that takes full account of an organisation’s impacts on the planet, its people and its future. That includes how Government operate and the decisions they take. Amendment 166 will help us to secure this for the future.

United Kingdom Internal Market Bill

Lord Whitty Excerpts

Committee stage & Committee: 2nd sitting (Hansard) & Committee: 2nd sitting (Hansard): House of Lords
Wednesday 28th October 2020 Lords Chamber

[Lord Whitty (Lab) [V]]

My Lords, like the noble Baroness, Lady Altmann, I originally put my name down to speak on this group because I wanted to give strong support to Amendment 52 in the name of the noble Baroness, Lady Boycott. She, the noble Lord, Lord Teverson, and the noble Baroness, Lady Altmann, have made a good case; after all, climate change and the other environmental challenges are bigger issues than Brexit, Covid or even the break-up of the United Kingdom. We need to ensure that nothing we do in this Bill or in parallel Bills diminishes our commitment to meeting our international obligations under the Paris Agreement or our national obligations under the Committee on Climate Change’s proposals on carbon budgets and the commitments we make as a Government and as a Parliament to meet our targets on that front. Amendment 52 would help deliver that.

During this afternoon—I was not here on the first day of Committee—I have also become increasingly concerned that the Bill is, as the noble Lord, Lord German, called it, twin-tracking different aspects of government policy on the devolution settlements and the way they are going. The two do not meet. The principal commitment here is market access. There are government commitments to standards in the Agriculture Bill and elsewhere, and there is the whole process of common frameworks, many of which are still in very preliminary form.

With regard to the broad public debate, the Government have managed a great diversionary tactic by banging Part 5 into the Bill and causing public and international outrage. However, there are some fairly profound issues in the lack of commonality or melding in the approaches on market access, common frameworks and the long-term implications for our devolution settlement. They have not been resolved today in the subjects we have discussed. At Second Reading, I expressed some concern that the Bill was not clear in relation to state aid and the internal market, or the role of the proposed office for the internal market.

A lot of this needs to be pulled together before we complete the Bill. I have a proposition. We have as a House established a short-term Select Committee looking at common frameworks. That has called for evidence; the deadline is 30 November. Would it not be sensible for the Government and the usual channels to talk to it? I am afraid I have not consulted my noble friend Lady Andrews, who chairs that committee, on this; it occurred to me only this afternoon. It is looking at the role of common frameworks, but in this Bill, which the Government are trying to get through as fast as possible, we are doing something which cuts across some of the commitments on them. Would it not be sensible to ask that Select Committee to look at the relationship between the Bill and common frameworks before we move to Report, or, if that is not possible, at least between Report and Third Reading? The process we normally adopt will not resolve these conundrums in the Bill; we need to find a novel way of dealing with them, and we have a solution at our fingertips with the Select Committee, which has already begun its work. I ask the Government and the usual channels to look at that proposition.

[Lord Judd (Lab) [V]]

My Lords, what a powerful team at the end of this very interesting debate. It was great to hear the noble Baroness, Lady Randerson, putting her case on standards so strongly; she is absolutely right. I was also delighted to hear my good neighbour and noble friend Lady Hayman—we live in the same ward in the west of Cumbria—speaking with all her authority. She will bring a very important contribution to the considerations of this House. My respect for the noble Baroness, Lady Altmann, is continuing and constant, and noble Lords hear it again tonight. What my noble friend Lord Whitty was saying about the useful contribution the Select Committee could make in getting things right should be taken very seriously. We get awfully trapped in patterns of organisation for our affairs and debates. Sometimes we do not look at our assets and the contributions they can make.

I strongly support my noble friend Lord Stevenson’s amendment and I am impressed and struck by the importance of Amendments 52, 53 and 54. They all deal with the essential quality of our existence and the action that is necessary to ensure that we have some sort of quality of existence, and ensuring that we are in a strong position to ameliorate the impact of climate change. These are absolutely fundamental issues for our future.

I sometimes look back on a long time in Parliament and politics and think that we sometimes want to fit things into organisational structures. Of course, the market is crucial and what we are debating is a reform of the market and what we are going to do, but the market is not an end in itself. We should constantly be restating the challenge: in the environment, in conditions of work and workers’ rights and employment conditions, of animal welfare, and of good husbandry of our land and care of it. There is also the whole issue of understanding that this is not just a choice of what we might do; we are dependent upon getting it right. From that standpoint, these amendments are a very important part of our proceedings, and I congratulate all those who have been involved in proposing them.

United Kingdom Internal Market Bill

Lord Whitty Excerpts

2nd reading & 2nd reading (Hansard): House of Lords
Monday 19th October 2020 Lords Chamber

[Lord Whitty (Lab) [V]]

My Lords, most contributions so far have related to Part 5 and the Government’s somewhat ham-fisted attempt to unilaterally disavow an undertaking made only a few months ago. I agree with those sentiments. and with the reports of the Constitution Committee and the EU Select Committee and the contributions by their chairs, the noble Baroness, Lady Taylor, and the noble Earl, Lord Kinnoull. I will also support the Motion in the name of the noble and learned Lord, Lord Judge, at the end of the debate.

However, this is quite a big Bill, and I want to talk about something else. Before doing so, I welcome my noble friend Lady Hayman to the Chamber. I commend her speech, including the importance that she stressed of environmental standards, which relate to this Bill as much as they do to much of the legislation we will face over the coming months.

I want to talk about state aid, which is in the Bill but is dealt with rather superficially. It needs to be clearer before the Bill finishes its passage through this House. In a sense, the noble Baroness, Lady Noakes, referred to this in her contribution. She and I were members of an EU Select Committee that produced a report on state aid about two years ago. We rarely agreed on anything fully, but we do agree on the importance of this issue.

At its most acute, the issue of state aid could be epitomised by the issue in Northern Ireland. As a result of the agreement and the way the Government are now pursuing the matter, through the Northern Ireland protocol Northern Ireland is to be part of the customs union and, to a large extent, the single market. So if the Stormont Government gave a subsidy or preferential public procurement arrangement to, say, a Northern Ireland textile company, the main exports of which are to the Republic, and if its Irish competitors objected, would EU state aid rules prevail or would the UK internal market rule prevail? It is clear that we need a UK state aid regime and it is fairly clear how that will relate to our international obligations under the WTO and, I hope, to future bilateral free trade agreements. But it is not at all clear how it will operate in relation to the internal market, which is the focus of the Bill. If that same Northern Irish company’s main export were to Scotland, what then would the arrangements be? If it were to England, would it be different again, because there would be an equivalent objection from England-based competitors?

The fact is that industrial, employment and consumer policy—all of which are relevant to state aid considerations —are differentially devolved between the three Administration and centralised in England but not in the UK. Of course, even in England there is the expected intention to devolve more industrial and employment policy to the English regions, so the question could, at some stage in the future, apply to Greater Manchester, which may have a different industrial and employment support system from that in the West Midlands. How does that play out in the new state aid framework?

The central question is whether there is yet a draft framework for all of this in relation to state aid, at least between the UK Government and the Scottish, Welsh and Northern Irish Governments. If not, what do the Government think it should look like and, above all, how should it be enforced? Is the office for the internal market, due to be established within the CMA, wholly a creature of the UK Government or will the devolved Administrations have a say in its governance and decision-making? During the EU regime, the Commission’s state aid arm had authority over member states, with prohibitions and fines at its disposal. That could be the case for the CMA.

[Baroness Bloomfield of Hinton Waldrist (Con)]

I remind noble Lords of the speaking limit.

[Lord Whitty (Lab) [V]]

Before the passage of the Bill, we need to clarify these issues.

Trade Bill

Lord Whitty Excerpts

2nd reading & 2nd reading (Hansard) & 2nd reading (Hansard): House of Lords
Tuesday 8th September 2020 Lords Chamber

[Lord Whitty (Lab) [V]]

My Lords, I welcome the Minister to his place in the House. I also welcome his maiden speech and that of the right reverend Prelate the Bishop of Blackburn, who gave a rather more convincing advertisement for Lancashire than the Minister did for the Bill.

I recognise that, in the circumstances, some of the Bill is necessary, but it is largely defined by what it omits, starting with parliamentary scrutiny. Yesterday, we were pressing for at least the equivalent scrutiny given to all treaties, particularly trade treaties, by the European Parliament—as the noble Lord, Lord Balfe, has just explained. But the new Bill omits much more than constitutional issues and parliamentary scrutiny. There are, in effect, no provisions for the protection of our food standards, which means that future trade deals could undermine the high standards of UK agriculture and the health of our nation and animal population.

There are other provisions that ought to be part of our approach to trade in the new circumstances. There are no provisions on employment standards—not even commitments to basic ILO conventions on workers’ rights or even protections against slavery. No consideration of basic human rights is included at all, yet it is in many extant EU trade agreements. We have to recognise that some of the countries that the Government are targeting for future trade agreements, such as China or Brazil, have regimes whose contempt for human rights and environmental protection is blatant. Ministers will of course say that the Bill relates only to continuity agreements, but even in that context some of the arrangements with the EU also raise issues of human rights—take the case of Turkey as an example. The Bill is not just a continuity Bill; it sets the tone for our approach to trade much more widely.

We know that the big prize for the more extreme Brexiteers is a trade agreement with Trump’s America. Frankly, that prospect raises deep anxieties about food standards, animal welfare and US pharma companies’ ambitions for the National Health Service market and the provision of healthcare. The Bill will protect us from none of that.

I hope that the Minister listens to the House and tells his colleagues that at least some of these provisions need to be introduced to the Bill before it ends its process through Parliament.

Housing Insulation

Lord Whitty Excerpts

Tuesday 25th February 2020 Lords Chamber

[Lord Callanan]

The noble Baroness makes an extremely good point. As she will be aware, the ECO scheme is funded from fuel bills. If we increase funding for the ECO scheme for poorer households, that puts up the cost of bills for all customers. That is one of the points we need to address; her point is well made.

[Lord Whitty (Lab)]

My Lords, I too welcome the Minister to his new post—and his new collaborative approach. However, he still manages to miss the point. He said that the ECO scheme was the main weapon for tackling fuel poverty, but it has failed to do that and to meet what is necessary on home heating to tackle climate change. Has the time not now come—I hope that he will raise this with the Chancellor—for the restoration of a tax-funded intervention for the nearly 4 million homes that are suffering particularly from lack of insulation and failed heating systems? This was dropped 10 years ago; it now needs to be restored.

[Lord Callanan]

I am, of course, always happy to work collaboratively with the noble Lord, but I point out gently that he is not correct to say that the ECO scheme has failed. The latest fuel poverty statistics show that the aggregate fuel poverty gap is falling year on year. We can always argue that we need to make faster progress, but the scheme is a success and it is working to bring down fuel poverty.