Question

To ask the Chancellor of the Exchequer, what assessment he has made of the viability of businesses affected by coronavirus in (a) north Southwark and (b) other areas with higher than average business rates which are not covered by the business rates exemption for companies with a rateable value of less than £51,000.

Answer (Jesse Norman)

On 17 March, in response to Covid-19, the Government introduced a 12 month business rates holiday for all eligible retail, leisure and hospitality businesses in England, including Southwark, with no cap on rateable values. Eligible businesses, large and small, will benefit from this exceptional step worth an additional £9.5bn in 2020-21.

Question

To ask the Chancellor of the Exchequer, with reference to the guidance published by Public Health England on 16 March 2020, what plans he has to provide additional underwriting to SMEs that will be affected by social distancing.

Answer (John Glen)

Question

To ask the Chancellor of the Exchequer, when each of the measures announced in Budget 2020 to mitigate the effects of covid-19 will be implemented to support businesses that are adversely affected.

Answer (Jesse Norman)

On 17 March, in response to Covid-19, the Government introduced a 12 month business rates holiday for all eligible retail, leisure and hospitality businesses in England, including Southwark, with no cap on rateable values. Eligible businesses, large and small, will benefit from this exceptional step worth an additional £9.5bn in 2020-21.

Question

To ask the Chancellor of the Exchequer, what recent discussions he has had with UK-based winemakers on (a) importing and (b) making wines from non-UK grapes after the transition period.

Answer (Jesse Norman)

The Government is committed to reviewing the alcohol duty regime. As part of this review, ministers and Treasury officials will continue to meet regularly with representatives of the UK alcohol industry, including winemakers.

Details of ministerial meetings can be found on the GOV.UK website:

https://www.gov.uk/government/collections/hmt-ministers-meetings-hospitality-gifts-and-overseas-travel

Question

To ask the Chancellor of the Exchequer, what recent assessment he has made of the potential merits of introducing regulations to prevent companies who employ temporary agency contractors operating disguised remuneration schemes before the reforms to off-payroll working rules are made in April 2020.

Answer (Jesse Norman)

It is possible to comply with the off-payroll working rules without using disguised remuneration schemes. The Government remains committed to tackling the continued use of disguised remuneration schemes, and set out further action to tackle these schemes at the Budget. HMRC have already published a factsheet to support contractors to prepare for the changes to the off-payroll working rules, and are continuing to step up their communications in the run up to implementation. HMRC have also launched further products to support contractors in understanding the changes, including a self-help guide on how to spot tax avoidance schemes.

Question

To ask the Chancellor of Exchequer, what steps his Department is taking to improve the usability of the Check Employment Status Tool ahead of the introduction of reforms to the off-payroll working rules.

Answer (Jesse Norman)

HMRC developed the Check Employment Status for Tax (CEST) online tool to help organisations and individuals determine employment status for tax and decide whether the off-payroll working rules apply.

The CEST service was developed in conjunction with tax specialists, contractors and other stakeholders. It was rigorously tested against established case law and settled cases to ensure it provides accurate results in line with current binding judgments. In the vast majority of uses, CEST will determine whether the engagement is employed or self-employed for tax purposes. HMRC will stand by CEST’s results provided accurate and correct information is used, in accordance with their guidance.

In November 2019, HMRC launched an enhanced version of CEST, having worked with over 300 stakeholders to identify improvements. The tool’s enhancements included making questions and the results clearer, increasing the number of questions to provide a more thorough assessment, and building in features to reduce user errors.

Since launch, HMRC have monitored customer feedback and have updated the tool’s language where this improves the customer experience. This includes providing additional help text and links to off-payroll guidance in HMRC’s Employment Status Manual. HMRC are continuing to monitor feedback with a view to making future usability updates.

Question

To ask the Chancellor of Exchequer, what assessment he has made of the effect on employment rights of the proposed reforms to off-payroll working rules.

Answer (Jesse Norman)

It is fair that two people working as employees pay broadly the same tax and NICs, even if one of them works through their own company and the other is directly employed. There is no direct link between employment status for rights and employment status for tax; however, those who wish to challenge their employment status for rights can take their case to an employment tribunal, regardless of their tax status.

Question

To ask the Chancellor of Exchequer, what recent assessment he has made of the (a) preparedness of businesses for the reforms to off-payroll working rules due to be implemented in April 2020 and (b) the potential merits of delaying that implementation date.

Answer (Jesse Norman)

As announced at Budget 2018, the reform of the off-payroll working rules will come into effect from 6 April 2020. The Tax Information and Impact Note (TIIN) published in July 2019 sets out HMRC’s assessment that the reform to the off-payroll working rules is expected to affect 170,000 individuals. The TIIN can be found here: https://www.gov.uk/government/publications/rules-for-off-payroll-working-from-april-2020/rules-for-off-payroll-working-from-april-2020.

As part of the review published on 27 February 2020, HMRC engaged with a number of affected individuals and businesses through a series of stakeholder roundtables to test business readiness.

The Government is committed to working with organisations to ensure changes to the off-payroll working rules are implemented correctly from April 2020. HMRC are undertaking an extensive programme of education and support to help organisations prepare for the reform. This includes:

• Offering one-to-one support to more than 2,000 of the UK’s biggest employers, and writing directly to 43,000 medium sized businesses and other organisations.
• Providing large and medium sized businesses, public bodies, and charities with factsheets to share with their contractors, and publishing this factsheet on gov.uk.
• Holding workshops with small tax agents, recruitment agencies, charities, and public bodies.
• Holding at least weekly webinars, with small tax agents, recruitment agencies, charities, public bodies and contractors.
• Publishing an enhanced version of the Check Employment Status for Tax online tool in November 2019 to help individuals and organisations make the right status determinations and apply the off-payroll rules correctly.

Question

To ask the Chancellor of Exchequer, what assessment he has made of the effect on labour market flexibility of the proposed reforms to off-payroll working rules.

Answer (Jesse Norman)

As announced at Budget 2018, the reform of the off-payroll working rules will come into effect from 6 April 2020. The Tax Information and Impact Note (TIIN) published in July 2019 sets out HMRC’s assessment that the reform to the off-payroll working rules is expected to affect 170,000 individuals. The TIIN can be found here: https://www.gov.uk/government/publications/rules-for-off-payroll-working-from-april-2020/rules-for-off-payroll-working-from-april-2020.

As part of the review published on 27 February 2020, HMRC engaged with a number of affected individuals and businesses through a series of stakeholder roundtables to test business readiness.

The Government is committed to working with organisations to ensure changes to the off-payroll working rules are implemented correctly from April 2020. HMRC are undertaking an extensive programme of education and support to help organisations prepare for the reform. This includes:

• Offering one-to-one support to more than 2,000 of the UK’s biggest employers, and writing directly to 43,000 medium sized businesses and other organisations.
• Providing large and medium sized businesses, public bodies, and charities with factsheets to share with their contractors, and publishing this factsheet on gov.uk.
• Holding workshops with small tax agents, recruitment agencies, charities, and public bodies.
• Holding at least weekly webinars, with small tax agents, recruitment agencies, charities, public bodies and contractors.
• Publishing an enhanced version of the Check Employment Status for Tax online tool in November 2019 to help individuals and organisations make the right status determinations and apply the off-payroll rules correctly.

Question

To ask the Chancellor of the Exchequer, if he will allocate resources to HMRC in the forthcoming Budget to help ensure that people who promoted the Loan Charge scheme are held accountable.

Answer (Jesse Norman)

The Government is determined to continue to tackle promoters of tax avoidance schemes, including disguised remuneration schemes. HMRC are on track to deliver the Government’s commitment to double the resources dedicated to tackling promoters by the end of 2019-20.

In the response to the Loan Charge review, the Government announced a package of measures to reduce the scope for promoters to market tax avoidance schemes. HMRC have committed to publishing a revised strategy for tackling promoters of tax avoidance schemes by the end of March 2020.

Question

To ask the Chancellor of the Exchequer, if the Government will take steps to reduce excise duty on UK spirits.

Answer (Jesse Norman)

All taxes are kept under review, and any changes to tax will be announced through the Budget process.

Question

To ask the Chancellor of the Exchequer, if he will undertake a review of alcohol duty and postpone changes to excise duty collection arrangements for post duty point dilution until the results of that review are available.

Answer (Jesse Norman)

As committed to in the manifesto, the Government will undertake a review of alcohol duties. Further announcements will be made in due course.

However, there are no plans to postpone the prohibitive actions against post duty point dilution for wine. UK drinks manufacturers have been given over 18 months’ notice to adapt their business models. The Treasury does keep all taxes under review, including their impact on drink manufacturers.

Question

To ask the Chancellor of the Exchequer, with reference to the HMRC Alcohol Duty Statistics (October 2019), what assessment he has made of the effect of the increase in duty on wine in 2019 Budget on duty receipts from wine.

Answer (Jesse Norman)

Announced at Budget 2018, Wine Duty rates on ‘wine of fresh grape’ and ‘made-wine’ at or below 22% Alcohol by Volume (ABV) increased by Retail Price Index (RPI) inflation from 1 February 2019.

Between February 2019 and January 2020, HMRC received £4,406 million from Wine Duty; an increase of £94.9 million (2.2%) compared to February 2018 to January 2019. The latest Wine Duty receipts are published in ‘HMRC tax receipts and National Insurance contributions for the UK’: https://www.gov.uk/government/statistics/hmrc-tax-and-nics-receipts-for-the-uk.

HMRC do not receive information on brands, prices and volumes and are therefore unable to disaggregate how much of this increase is linked to the 1 February 2019 RPI rate rise compared to other wine market changes.

Question

To ask the Chancellor of the Exchequer, what plans he has to bring forward legislative proposals to further regulate tax advisers.

Answer (Jesse Norman)

As announced in the response to the independent review of the loan charge, the Government will launch a call for evidence on what steps it can take to raise standards in the tax advice market.

Question

To ask the Chancellor of the Exchequer, if he will make it his policy to issue a moratorium 2019 Loan Charge payments for the duration of the independent review of that charge.

Answer (Jesse Norman)

The Government remains committed to tackling tax avoidance schemes, but it has listened to concerns about the impact of the Loan Charge on individuals. An independent review is under way to consider the appropriateness of the Loan Charge as a policy response, and its impact on individuals.

The reviewer, Sir Amyas Morse, has been asked to provide recommendations by mid-November so that any individuals affected can have certainty about their next steps in advance of the 31 January 2020 Self - Assessment deadline.

While the Review is under way, it is right that the Loan Charge remains in force, in line with current legislation.

HMRC has made clear it will consider all personal circumstances to agree a manageable and sustainable payment plan wherever possible and there is no maximum limit on how long a customer can be given to pay the charge.

Further information about the Review and guidance for affected taxpayers is available at www.gov.uk/government/publications/disguised-remuneration-independent-loan-charge-review.

Question

To ask the Chancellor of the Exchequer, what recent estimate his Department has made of the number of people who have not reached an agreement with HMRC under the Loan Charge scheme following its introduction in April 2019.

Answer (Jesse Norman)

The Government estimates that around 50,000 individuals will be affected by the 2019 loan charge. More than 28,000 scheme users expressed an interest in settling their tax affairs, with over 19,000 returning their information under the settlement terms, which were published in November 2017.

HMRC are currently working through the settlement process with scheme users who came forward to settle their tax affairs before 5 April 2019. However, for those customers who are at the final stages of settling, HMRC will allow sufficient time for them to make their decision and sign their settlement paperwork. HMRC will ensure that no one is disadvantaged by any HMRC delay.

Since the loan charge was announced, HMRC have agreed around 7,000 settlements with employers and individuals, worth over £1.5 billion. It is too early to determine how many scheme users who are liable to the loan charge, will have complied with their filing/reporting obligations.

Question

To ask the Chancellor of the Exchequer, what recent assessment his Department has made of the potential merits of extending the settlement deadline for the 2019 Loan Charge.

Answer (Jesse Norman)

The Government estimates that around 50,000 individuals will be affected by the 2019 loan charge. More than 28,000 scheme users expressed an interest in settling their tax affairs, with over 19,000 returning their information under the settlement terms, which were published in November 2017.

HMRC are currently working through the settlement process with scheme users who came forward to settle their tax affairs before 5 April 2019. However, for those customers who are at the final stages of settling, HMRC will allow sufficient time for them to make their decision and sign their settlement paperwork. HMRC will ensure that no one is disadvantaged by any HMRC delay.

Since the loan charge was announced, HMRC have agreed around 7,000 settlements with employers and individuals, worth over £1.5 billion. It is too early to determine how many scheme users who are liable to the loan charge, will have complied with their filing/reporting obligations.

Question

To ask the Chancellor of the Exchequer, what assessment he has made of the effect of a rise in excise duty on wine sales.

Answer (Robert Jenrick)

HMRC publishes a Tax Information Impact Note explaining the impact of the change, each time a duty rate is amended. Please refer to the GOV.UK website to find these (or the following link https://www.gov.uk/government/publications/increase-in-alcohol-duty-rates)

Question

To ask the Chancellor of the Exchequer, what assessment he has made of the potential merits of allocating additional capital funding to the mental health estate in the forthcoming Spending Review.

Answer (Elizabeth Truss)

Government has committed £3.9bn of new capital investment by 2022/23 to transform and modernise NHS buildings.

Of this, £2.6bn of capital funding has been allocated to 153 STP transformation schemes – the single biggest injection of its kind in the NHS in over a decade. This includes about £300m for mental health and learning disability schemes.

In addition, the Department of Health and Social Care spent almost £25m capital last year on central programmes to support mental health services. This includes schemes to deliver Perinatal Mental Health Mother & Baby Units to deliver more personalised care to expectant and new mums with serious mental ill health.

Improving mental health is at the heart of this government’s agenda and the STP capital investment is another step in the government’s ambition to achieve greater parity between physical and mental health care.

All future capital funding proposals will be assessed at the forthcoming Zero-Based Capital Review at the Spending Review.

The government is increasing NHS spending by £33.9bn in cash terms by 2023/24 – reflecting that the NHS is this government’s top spending priority.

Question

To ask the Chancellor of the Exchequer, what steps his Department has taken to make people aware of the change in loan charges; how they have identified the number of people so affected; and how many people have been informed of the changes to date.

Answer (Mel Stride)

Since November 2017, HMRC has been writing directly to individuals and employers who may be impacted by the loan charge. HMRC has written directly to over 40,000 users, identified through its compliance work, IT records and tax return data.

In addition, it is actively encouraging disguised remuneration scheme users to come forward and settle through its regular contact with customers and has raised additional awareness through its series of Spotlight publications, tweets and webinars. In July 2018, an HMRC issue briefing on disguised remuneration charge on loans was published on GOV.UK. This provides additional information about the loan charge, links to the settlement terms and relevant Spotlights along with helpful information for those who may have difficulty paying what they owe.

HMRC is working hard to help individuals get out of tax avoidance for good and is encouraging anyone who is concerned about their ability to pay to contact them as soon as possible to discuss their options. In November 2017, HMRC set up a dedicated helpline for those wanting to settle their avoidance scheme use, and discuss payment options. HMRC will work with all individuals to reach a manageable and sustainable payment plan wherever possible.

Question

To ask the Chancellor of the Exchequer, what estimate he has made of the number of (a) current and (b) former (i) employees, (ii) contractors and (iii) agency workers that will be affected by changes to loan charge schemes; and what support the NHS is providing to those affected.

Answer (Mel Stride)

The 2019 loan charge is targeted at artificial tax avoidance schemes where earnings were paid via a third party in the form of ‘loans’ which in reality were never repaid – ‘disguised remuneration’ (DR) schemes.

The Government recognises that the charge on DR loans will have a significant impact on some people who have used DR schemes. The impact of the DR loan charge on these individuals was considered at Budget 2016, when the measure was first announced. _­HMRC consulted on the measure in August 2016. The latest tax information and impact note (TIIN) can be found at: https://www.gov.uk/government/publications/disguised-remuneration-further-update/disguised-remuneration-further-update.

The Government estimates that up to 50,000 individuals will be affected by the 2019 loan charge. The loan charge applies to all users of DR tax avoidance schemes. It does not single out a specific group or industry, such as contractors or doctors. HMRC data indicates that fewer than 3% of those affected work in medical services (doctors and nurses) and teaching. Further information can be found in the Government’s issue briefing at: https://www.gov.uk/government/publications/hmrc-issue-briefing-disguised-remuneration-charge-on-loans/hmrc-issue-briefing-disguised-remuneration-charge-on-loans

The Government does not have any data on support the NHS provides to those affected by the DR loan charge.

HM Revenue and Customs (HMRC) is working hard to help individuals get out of tax avoidance for good and is encouraging anyone who is concerned about their ability to pay to contact them as soon as possible to discuss their options. In November 2017, HMRC set up a dedicated helpline for those wanting to settle their avoidance scheme use, and discuss payment options. HMRC will work with all individuals to reach a manageable and sustainable payment plan wherever possible.

Question

To ask the Chancellor of the Exchequer, how many meetings (a) Ministers and (b) officials in his Department had with Quintessential Brands or their representatives in each of the last four years.

Answer (Robert Jenrick)

Based on available records, there were no meetings held between Treasury Ministers and officials with Quintessential Brands during January 2015 to September 2018.

Treasury Ministers’ meetings and hospitality are published quarterly and can be found at the following link.

https://www.gov.uk/government/collections/hmt-ministers-meetings-hospitality-gifts-and-overseas-travel

Senior Treasury Officials’ meetings and hospitality are published quarterly and can be found at the following link.

https://www.gov.uk/government/collections/senior-officials-expenses

Details of meetings taking place between non-senior officials and the listed company are not readily available and would cost a disproportionate amount to identify and report.

Question

To ask Mr Chancellor of the Exchequer, what steps his Department is taking to support businesses to adhere to changes to VAT reporting from 2019.

Answer (Mel Stride)

There will be a range of support available to help businesses prepare for VAT digital reporting in 2019. HMRC has been working closely with software providers, business representative bodies and the accountancy profession to ensure the right support is in place to help businesses adapt. The customer support model will guide businesses to the most appropriate help including technical support, webchat, YouTube training videos, webinars, helpline and agent and business guides. A pilot will start in Spring 2018 to test the system, including the support model, well ahead of April 2019.

Question

To ask Mr Chancellor of the Exchequer, what steps his Department is taking to update the Reinsurance (Acts of Terrorism) Act 1993 to enable insurance companies to pay compensation to businesses after terrorism attacks when there is no damage to property.

Answer (John Glen)

There is nothing in current legislation in the Reinsurance (Acts of Terrorism) Act 1993 that prevents insurers from offering terrorism insurance beyond property damage to businesses, and indeed such products exist on the market.

That said, I understand the concerns that businesses have raised about terrorism insurance cover for business interruption losses that are not linked to damage to commercial property and want to do everything we can to help. The Treasury remains in discussions with the insurance industry, Pool Re and other interested parties to ensure that the Act continues to enable appropriate terrorism cover to be available for all businesses in the UK.

We are actively exploring options, including legislation, to address this and will confirm our next steps in due course.

Question

To ask Mr Chancellor of the Exchequer, what assessment his Department has made of the adequacy of terrorism insurance in compensating businesses after an act of terror.

Answer (John Glen)

There is nothing in current legislation in the Reinsurance (Acts of Terrorism) Act 1993 that prevents insurers from offering terrorism insurance beyond property damage to businesses, and indeed such products exist on the market.

That said, I understand the concerns that businesses have raised about terrorism insurance cover for business interruption losses that are not linked to damage to commercial property and want to do everything we can to help. The Treasury remains in discussions with the insurance industry, Pool Re and other interested parties to ensure that the Act continues to enable appropriate terrorism cover to be available for all businesses in the UK.

We are actively exploring options, including legislation, to address this and will confirm our next steps in due course.

Question

To ask Mr Chancellor of the Exchequer, if he will make it his policy to introduce legislation to update the Reinsurance (Acts of Terrorism) Act 1993 to enable insurance companies to pay compensation to businesses after terrorism attacks when there is no damage to property.

Answer (John Glen)

There is nothing in current legislation in the Reinsurance (Acts of Terrorism) Act 1993 that prevents insurers from offering terrorism insurance beyond property damage to businesses, and indeed such products exist on the market.

That said, I understand the concerns that businesses have raised about terrorism insurance cover for business interruption losses that are not linked to damage to commercial property and want to do everything we can to help. The Treasury remains in discussions with the insurance industry, Pool Re and other interested parties to ensure that the Act continues to enable appropriate terrorism cover to be available for all businesses in the UK.

We are actively exploring options, including legislation, to address this and will confirm our next steps in due course.

Question

To ask Mr Chancellor of the Exchequer, what meetings his Department has held with terrorism insurance providers in the last 12 months.

Answer (John Glen)

Treasury Ministers and officials have meetings with a wide variety of organisations in the public and private sectors as part of the process of policy development and delivery.

Details of ministerial and permanent secretary meetings with external organisations on departmental business are published on a quarterly basis and are available at:

https://www.gov.uk/government/collections/hmt-ministers-meetings-hospitality-gifts-and-overseas-travel

The government remains in regular discussion with the insurance industry, Pool Re and other interested parties on the provision of terrorism insurance in the UK.

Question

To ask Mr Chancellor of the Exchequer, when his Department was first notified of the need to update Pool Reinsurance to cover knife, vehicle and cyber terrorism; and what the timetable is for its reform.

Answer (Steve Barclay)

The Reinsurance (Acts of Terrorism) Act 1993 established the government-backed terrorism reinsurer, Pool Reinsurance. The scheme reinsures against business losses caused by physical damage after an act of terrorism, in recognition of the specific challenges in relation to a lack of insurance for industrial and commercial property at that time. It was not designed to cover personal injury claims, such as those caused by a knife or vehicle attack, or non-physical damage, such as data theft.

Within the remit of providing this type of reinsurance, the scheme was recently amended to remove the cyber exclusion. This means that physical damage caused remotely, e.g. by a “cyber trigger”, is included in the scope of cover. This change will come into effect on 1 April 2018.

The government is in regular discussion with the insurance industry, Pool Re and other interested parties to make sure that the Reinsurance Act 1993 continues to enable appropriate terrorism cover to be available for businesses.

I have also met the hon Member to discuss this.

Question

To ask Mr Chancellor of the Exchequer, whether the Government plans to introduce legislation to update the Reinsurance (Acts of Terrorism) Act 1993 to enable insurance companies to offer terrorism insurance beyond property damage to businesses.

Answer (Steve Barclay)

There is nothing in current legislation in the Reinsurance (Acts of Terrorism) Act 1993 that prevents insurers from offering terrorism insurance beyond property damage to businesses, and indeed such products exist on the market.

It is up to businesses to decide what risks they would like to be insured against, and for insurers to assess the extent of the risks they are willing to cover. The Government does not generally intervene in these commercial decisions by businesses and insurers.

That said, we remain in discussions with the insurance industry, Pool Re and other interested parties to ensure that the 1993 Reinsurance Act continues to enable appropriate terrorism cover to be available for all businesses in the UK.

I am due to meet the Honourable Member shortly and I am happy to discuss his questions in further detail.

Question

To ask Mr Chancellor of the Exchequer, if he will make it his policy to introduce legislation to update the Reinsurance (Acts of Terrorism) Act 1993 to enable insurance companies to pay compensation to businesses after terrorism attacks when there is no damage to property.

Answer (Steve Barclay)

There is nothing in current legislation in the Reinsurance (Acts of Terrorism) Act 1993 that prevents insurers from offering terrorism insurance beyond property damage to businesses, and indeed such products exist on the market.

It is up to businesses to decide what risks they would like to be insured against, and for insurers to assess the extent of the risks they are willing to cover. The Government does not generally intervene in these commercial decisions by businesses and insurers.

That said, we remain in discussions with the insurance industry, Pool Re and other interested parties to ensure that the 1993 Reinsurance Act continues to enable appropriate terrorism cover to be available for all businesses in the UK.

I am due to meet the Honourable Member shortly and I am happy to discuss his questions in further detail.

Question

To ask Mr Chancellor of the Exchequer, whether the Government plans to require insurance companies to offer terrorism insurance on all business policies.

Answer (Steve Barclay)

There is nothing in current legislation in the Reinsurance (Acts of Terrorism) Act 1993 that prevents insurers from offering terrorism insurance beyond property damage to businesses, and indeed such products exist on the market.

It is up to businesses to decide what risks they would like to be insured against, and for insurers to assess the extent of the risks they are willing to cover. The Government does not generally intervene in these commercial decisions by businesses and insurers.

That said, we remain in discussions with the insurance industry, Pool Re and other interested parties to ensure that the 1993 Reinsurance Act continues to enable appropriate terrorism cover to be available for all businesses in the UK.

I am due to meet the Honourable Member shortly and I am happy to discuss his questions in further detail.

Question

To ask Mr Chancellor of the Exchequer, what steps his Department is taking to ensure that businesses affected by terrorism do not experience unnecessary delays in receiving payments from insurance providers.

Answer (Steve Barclay)

There is an established legal process for the Treasury to certify an act of terrorism for insurance purposes, following formal notification by Pool Re. The Treasury recognises the urgency of responding to requests for certification and treats this as a matter of priority.

After the Treasury has issued their certification, it is up to insurers to process any claims from their customers. They will make an assessment based on the evidence available and the insurance coverage purchased by the customer.

The Financial Conduct Authority (FCA) sets the conduct standards required of insurance firms to ensure that these customers are treated fairly, including provisions relating to the handling of claims. The FCA has the power to punish insurers if they are found to be delaying payments unnecessarily. Furthermore, the Enterprise Act 2016 introduced a legal requirement for claims to be made within a reasonable timescale, and created an entitlement to damages where claims are paid late.

I am due to meet the Honourable Member shortly and I am happy to discuss his question in further detail.

Question

To ask Mr Chancellor of the Exchequer, what steps his Department is taking to ensure prompt payment of compensation by insurance companies to businesses affected by recent terrorist attacks; and if he will make an assessment of the potential merits of bringing forward legislative proposals to improve the speed with which such payments are made.

Answer (Steve Barclay)

The Government is determined that insurers should treat customers fairly and firms are required to do so under the Financial Conduct Authority (FCA) rules. The FCA sets the conduct standards required of insurance firms which aim to ensure consumers are treated fairly. This includes provisions relating to the handling of claims by insurers. The rules state that insurers must handle claims fairly and promptly; provide reasonable guidance to help a policyholder make a claim, and appropriate information on its progress; not reject a claim unreasonably; and settle claims promptly once settlement terms are agreed. Furthermore, through the Enterprise Act 2016, the Government introduced a legal requirement for claims to be made within a reasonable timescale, and created an entitlement to damages where claims are paid late.

Following discussions with the Metropolitan Police, the Treasury has formally certified the London Bridge attack as an act of terrorism, following an established legal process. This is a necessary step before any claims can be made on the terrorism reinsurer, Pool Re. The Treasury recognises the urgency of responding to requests for certification and treats this as a matter of priority.

Question

To ask Mr Chancellor of the Exchequer, what steps his Department is taking to ensure that insurance companies pay out compensation due to businesses affected by recent terrorist attacks as quickly as possible.

Answer (Steve Barclay)

The Government is determined that insurers should treat customers fairly and firms are required to do so under the Financial Conduct Authority (FCA) rules. The FCA sets the conduct standards required of insurance firms which aim to ensure consumers are treated fairly. This includes provisions relating to the handling of claims by insurers. The rules state that insurers must handle claims fairly and promptly; provide reasonable guidance to help a policyholder make a claim, and appropriate information on its progress; not reject a claim unreasonably; and settle claims promptly once settlement terms are agreed. Furthermore, through the Enterprise Act 2016, the Government introduced a legal requirement for claims to be made within a reasonable timescale, and created an entitlement to damages where claims are paid late.

Following discussions with the Metropolitan Police, the Treasury has formally certified the London Bridge attack as an act of terrorism, following an established legal process. This is a necessary step before any claims can be made on the terrorism reinsurer, Pool Re. The Treasury recognises the urgency of responding to requests for certification and treats this as a matter of priority.