Domestic Building Works (Consumer Protection) Bill

Chi Onwurah Excerpts

Friday 19th November 2021 Commons Chamber

[Chi Onwurah (Newcastle upon Tyne Central) (Lab)]

I congratulate the hon. Member for Wyre Forest (Mark Garnier) on bringing forward the Bill. I very much join him in his opening tribute to the building trades, which are not always as much valued or appreciated as they should be. Particularly now, after two years of pandemic times, our homes are very important to us. We have spent a lot of time looking at our walls and imagining how we can improve them. Unfortunately, however, people have often been put off by rogue traders, for the reasons the hon. Member laid out.

Currently, anyone can call themselves a builder. They are not required to provide any evidence of training, qualifications or experience. This makes it really difficult for homeowners to know which traders are legitimate, and it allows cowboy builders to undercut legitimate builders. The only legal protection for consumers is contract law, but that is not a viable option for many, for the reasons the hon. Member set out, meaning that cowboy builders can largely get away with shoddy work.

This Bill sets out to provide greater protection for homeowners by requiring builders to get licensed and by outlawing cowboy builders, who would face fines. It also makes provision for consumers to get compensation, as well as for a licensing service to oversee the scheme and an ombudsman service to resolve disputes between traders and consumers. We very much welcome the intention behind the Bill, and we will not be opposing it.

Although there are some schemes to help consumers find legitimate and reputable builders, such as TrustMark, they are voluntary and therefore cannot fully tackle this issue. It is an issue that must be familiar to MPs up and down the country, and indeed to many homeowners. Earlier this year a constituent of mine applied for heating work to be carried out under the Government’s green homes scheme, but the builder left her home in a completely unacceptable state. She was unable to use her living room for five months, and mice—which featured in a debate earlier today—started coming in because the floorboards had not been replaced properly.

Consumers like my constituent are unable to find appropriate redress. They are also faced with scam ads and fake reviews online, which makes the task of finding a reputable builder even harder. I commend the campaign launched by Which? earlier this year, calling on the Government to introduce laws that would force tech giants to protect consumers online. According to research conducted by Which?, consumers are more than twice as likely to choose poor-quality products after being exposed to fake reviews. The Federation of Master Builders has been warning consumers about customer review sites promoting rogue traders since 2015. This cannot be allowed to continue. In 2018, the FMB found that 32% of homeowners were discouraged from arranging home improvements requiring a builder because they feared hiring a rogue builder, and it estimated that this was causing the economy to lose £10 billion of construction activity a year. That figure was also quoted by the hon. Member for Wyre Forest. This is not only about protecting homeowners; it is also an economic issue for our country.

We welcome the intention behind the Bill, but the Government should have acted sooner. It should not be the job of a Conservative Back Bencher, however well respected, to rectify the mistakes of his own Government. Bodies such as the FMB and Which? have been calling on the Government to act on this issue. The chief executive of the FMB, Brian Berry, has said:

“Licenses for the building trade are long overdue and have widespread support in the industry. They will protect consumers, enhance the reputation of the industry, and provide a significant boost to the economy.”

Which? says that the enforcement of rogue traders falls to local authority trading standards services, but as we have heard, they are not always able to inspect buildings as they would like to, because their budgets are not ring-fenced, and their funding has been cut for several years.

The Chartered Trading Standards Institute estimates that local trading standards services have lost 56% of their full-time equivalent staff since 2009, and 20 services have had their funding reduced by more than 60% since 2011. That has left 44% of local authorities lacking the expertise needed to enforce legislation, because staff are having to perform other duties. We would like to ensure that those services have the resources and funds that they need in order to carry out their duty to protect consumers from rogue traders. Not only have the Government failed to support local authorities in this respect, but their funding cuts have made it harder for those who do have the powers to enforce existing legislation.

The Bill is not perfect, and there are questions that I shall want to pursue if it makes further progress, but I think it is up to the Minister and the Government to set out what they are doing to address the critical issue raised by the hon. Member for Wyre Forest—an issue that is spoiling the lives of so many of my constituents and, I am sure, constituents of Members in all parts of the House. What are the Government going to do to address this issue if they are not going to support the hon. Member’s Bill?

Oral Answers to Questions

Chi Onwurah Excerpts

Tuesday 16th November 2021 Commons Chamber

[Kwasi Kwarteng]

My hon. Friend smuggled a leading question into his first question. He knows that ARIA is a key part of our strategy to become a science superpower, and he and I can discuss the role that Bolton will play in that exciting future.

[Chi Onwurah (Newcastle upon Tyne Central) (Lab)]

The “Life Sciences Vision” has dementia as its first mission. The Conservative manifesto committed to doubling research funding in a dementia moonshot, but the Budget ignored it. The UK Dementia Research Institute called this

“a major blow to UK neuroscientists racing to find cures for these devastating diseases”.

Alzheimer’s Research UK said that this

“lets down the nearly one million people in the UK affected by this devastating condition.”

So will the Secretary of State now set out a clear timetable for doubling dementia research funding, as Labour has? Or is the “Life Sciences Vision”, like the R&D road map, the industrial strategy, the innovation strategy, the grand challenges and Northern Powerhouse Rail, all talk and no action?

[Kwasi Kwarteng]

I completely refute the hon. Lady’s allegation that those things are all words. The innovation strategy is the first of its kind. It has been broadly welcomed across the sector, and she will know that dementia is one of the seven technologies in engineering and biology that we are pursuing in the innovation strategy.

Draft National Security and Investment Act 2021 (Monetary Penalties) (Turnover of a Business) Regulations 2021 Draft National Security and Investment Act 2021 (Notifiable Acquisition) (Specification of Qualifying Entities) Regulations 2021

Chi Onwurah Excerpts

Wednesday 20th October 2021 General Committees

[Paul Scully]

As I said, there is a voluntary notification process, and the investment security unit in the Department will be able to offer advice and give forewarning. With this measure, while protecting security and our citizens, we want to give certainty to business. We certainly do not want to be deterring investment in this country; it has been a success story for the UK for so many years. Again, I think we have got that balance right.

These are really important changes to the UK’s investment screening system. Sectoral expertise has been vital for ensuring that the mandatory notification is proportionate and targeted, and we have taken great care and time to get that right.

Alongside the introduction of the NSI Bill in November 2020, the Government launched and ran an eight-week public consultation on the proposed descriptions in the 17 areas of the economy referred to in the draft regulations. After that, we published revised definitions in March. We undertook further targeted engagement with stakeholders in key sectors such as communications, synthetic biology and suppliers to the emergency services to develop further the proposed descriptions to provide businesses and investors with further clarity. I place on the record my thanks for the extensive input we have had from cross-sector organisations in getting the definitions right.

The regulations strike a careful and appropriate balance between ensuring that our national security is safeguarded and keeping the number of businesses caught by the mandatory notification requirement to a necessary and proportionate level. Furthermore, to monitor the impacts on business investors, and particularly small and medium-sized enterprises, the Government have chosen to include a shorter three-year post-implementation review in the regulations instead of the more standard five-year period.

The Government intend to publish extensive guidance across all 17 areas of the economy specified in the regulations to assist parties further in understanding the requirements. In response to the point made by my hon. Friend the Member for North West Cambridgeshire, that will help give that certainty to businesses pre-acquisition. My Department will continue to engage daily with businesses to help them understand the Act’s requirements.

These are detailed and technical statutory instruments that give effect to the purpose of the NSI Act. They have been carefully developed and tested to ensure that they give maximum clarity to businesses while allowing us to protect the UK’s national security. I commend them to the Committee.

2.39 pm

[Chi Onwurah (Newcastle upon Tyne Central) (Lab)]

It is a great pleasure to serve under your chairship, Sir George, to consider these two pieces of legislation.

As the Minister said, these regulations are made under the National Security and Investment Act 2021. I thank the Minister for setting out some of the background to that Act. During the passage of that legislation through Parliament, I was clear, as were colleagues, that the Government need new powers to deal with evolving national security threats in corporate transactions. Labour supported the legislation because it was legislation demanded by Labour, and we support these SIs too, as they are critical to the effective functioning of the new investment-screening regime.

I will say something about each of these SIs in turn, starting with the turnover of a business regulations. As the Minister has set out, this relates to the civil monetary penalties that the Secretary of State can impose under the new regime. Section 41 of the Act sets out the maximum fixed penalty and, where applicable, the maximum daily rate penalty that may be imposed. Where a business commits an offence, the maximum fine is the higher of 5% of global turnover or £10 million. I do not recall intellectual property or other assets being referenced in the Act.

Section 41 also enables the Secretary of State to make regulations specifying how the maximum penalties applicable to business should be calculated and to amend the maximum penalty amounts or percentage rates. The SI is made under section 41(8) and 41(9) of the Act and does three things: it clarifies that, for the purposes of penalties, businesses include sole traders; provides a statutory definition of where one business controls another; and establishes the test for determining the turnover of a business for the purpose of calculating maximum penalties.

We support the principle that the new regime should be underpinned by robust enforcement mechanisms, and it is important that the Secretary of State has the relevant powers to punish and deter non-compliance with the regime. However, such penalties make the need for clarity and certainty even more important.

During the Committee stage of the Act, I asked whether the monies received by the Department for Business, Energy and Industrial Strategy from the payment of penalties could be put towards a specific purpose, rather than going into the general Consolidated Fund. I urge the Government to think about that again. Would it not be fantastic if this money was, for example, spent on supporting our great innovators and start-ups to further build on our domestic resilience in these sectors?

I turn to the specification of qualifying entities regulations, which establish descriptions of qualifying entities for the purposes of section 6 in the Act. In other words, this SI defines the sectors that will fall under the scope of the mandatory regime. A notifiable acquisition takes place when a person gains control of a qualifying entity of a specified description. As Members will know, a buyer must give notice to the Secretary of State before making a notifiable acquisition in one of the 17 sectors, so the responsibility falls on the buyer to understand whether the acquisition it is contemplating is notifiable.

As the Minister set out, the definitions contained in the 17 schedules have been refined in response to stakeholder feedback following earlier consultations on the scope and definitions of the 17 sectors from November 2020 to January 2021. This led to important changes in all 17 sectors. For example, the scope of the mandatory regime within the artificial intelligence sector has been significantly narrowed to focus on only three higher-risk applications: the identification of objects, people and events, advanced robotics, and cyber security.

We welcome the fact that the Government have continued their consultation with business and wider stakeholders to refine the mandatory sector, but there is a lack of transparency in who has been involved and what the impact has been. I think it would benefit the Committee if the Minister described how the key changes made by this statutory instrument differ from the draft definitions published in March 2021, and why those changes have been made. For example, the reference to “Critical Suppliers to the Emergency Services” sector in the March proposals has become “Suppliers to the emergency services”, and the definitions of goods and services used by the emergency services have also been amended. Can he set out why those changes have been made? We see that changes have been made, but we do not know who has been consulted. It would be helpful to understand what changes have been made and why.

The Minister will know that there remain concerns about the definitions. The BioIndustry Association, which focuses on synthetic biology, has said most recently, so after the consultation, that:

“Synthetic Biology is defined too broadly in the legislation, meaning companies developing medicines and technologies with no national security implications will be captured. This risks imposing a long, unnecessary process for biotech to receive funding and could deter investment in the sector, and subsequently the development of medicines for patients.”

The Minister spoke about the level of consultation without giving specifics on how many businesses had been consulted. The BIA goes on to say:

“It is important that the new regime works well and is effective. Even once the regime commences, the BIA encourages the Government to listen to industry about how it is being perceived.”

I would be grateful if the Minister gave some indication of how he intends to continue engagement with industry and business on these issues.

There is a lack of transparency on the consultations that have led to these amendments, so can the Minister confirm what engagement he has had specifically with small businesses and organisations that represent small and medium-sized enterprises? As he will know, the Act’s impact assessment notes that 80% of transactions within the scope of the mandatory regime will involve SMEs. SMEs are the lifeblood of our economy, and it is from the growth of SMEs that we hope to build back not only better but more sustainably and fairly. That is why Labour has consistently called for SMEs to be consulted by the Government, listened to and provided with comprehensive guidance on how to navigate this new regime.

Staying with the question of guidance, I note that to date the Department for Business, Energy and Industrial Strategy has published only one piece of sector-specific guidance, for the higher education and research-intensive sector. In the Bill Committee, I and my hon. Friends repeatedly highlighted the importance of prompt and accessible guidance so that firms operating in the relevant sectors understand whether their businesses are affected.

I say to the Minister directly that, based on conversations I have had with stakeholders—including university research departments and university start-ups, but also investment and equity finance organisations, and indeed law firms—there remains significant confusion as to who may be impacted by these regulations, and indeed by the Act. That is seen as having a chilling impact on foreign direct investment in this country and—something we raised in the Bill Committee—as a job creation scheme for lawyers. Many legal firms are already setting up workstreams to address that but, as we all know, small and medium-sized enterprises do not have the benefits of large legal firms, so not to provide the kind of guidance that we have asked for is putting such enterprises at a huge disadvantage.

Will the Minister therefore confirm what wider sector-specific guidance will be published, and according to what timetable, in advance of the regime coming fully into effect on 4 January? If the regime is to operate effectively, it is critical that businesses understand how to interpret whether their activity falls within the scope of the regulations. I suggest to the Minister that he needs to do more on this over the next 12 weeks, if we are to ensure—as I emphasise yet again—that small and medium-sized enterprises are not unduly and negatively impacted by the regulations.

Before concluding, I want to say something about the important context of the draft SIs. Owing to a weak pound and lower equity prices on the FTSE when compared with other international markets, private equity firms are acquiring UK companies at the fastest rate since 2008. Unprecedented levels of dry powder mean that that is only set to continue.

The Act gives the Secretary of State the power to call in transactions across the economy, not just in the 17 mandatory sectors where that decision has given or may give rise to a national security risk. Clearly, however, the success of the new regime in protecting our national security interests, such as in the supply chain, is dependent on the Secretary of State’s willingness to use his new powers. The indications are not good.

To take Morrisons, for example, it is a much loved British company, which has been rooted in communities up and down the country for more than 100 years. It is the second-largest fresh-food manufacturer in the UK, supporting thousands of farmers across the country. That is why my right hon. Friend the Member for Doncaster North (Edward Miliband) and others have been clear for months that Morrisons is also of strategic importance to the country’s food security. Labour is clear that food security is an essential part of national security, and yet there is no indication that the Secretary of State has considered the impact of that transaction on the country’s food security.

Labour supports the two draft SIs, which will play an important role in shaping the scope of the new regime and the consequences when the rules are not followed. Labour is calling for greater transparency and greater guidance to support our small and medium-sized enterprises. We are aware that the public will be watching closely how the Government use their powers under the Act to protect our vital national interests.

Post Office Closures

Chi Onwurah Excerpts

Tuesday 19th October 2021 Westminster Hall

[Chi Onwurah (Newcastle upon Tyne Central) (Lab)]

It is a great pleasure to serve under your chairmanship, Mr Betts. I want to echo your tribute to our friend, Sir David Amess, who was tragically and horrifically murdered. As you said, he could well have been in the Chair for today’s debate. As my hon. Friend the Member for Hammersmith (Andy Slaughter) said, this is the kind of debate that Sir David would have truly appreciated. I am sure that there would have been a reason why post office closures showed that Southend needed to be a city, and I am so glad that that is to be realised. This is also the sort of debate that he would have appreciated because Members on all sides have conducted it with affability, civility and respect. I want also to pay tribute to the hon. Member for Motherwell and Wishaw (Marion Fellows), not only for securing the debate but for the great cross-party work that her APPG does to support post offices.

As we have heard, for 361 years the Post Office has been at the heart of the community, and post offices have established themselves as the backbones of local economies across the United Kingdom. My hon. Friend the Member for Hammersmith, the hon. Members for Keighley (Robbie Moore), for Caithness, Sutherland and Easter Ross (Jamie Stone), for Strangford (Jim Shannon), for East Renfrewshire (Kirsten Oswald) and the SNP spokesperson, the hon. Member for Glasgow East (David Linden), have spoken of the contribution that post offices make to our constituencies. The network provides over 170 essential services to 17 million customers and one third of small businesses each and every week.

More recently, the pandemic has highlighted how vital a reliable postal service is—I am sure that we all appreciated that during the pandemic. A survey by the National Federation of SubPostmasters found that 97% of post offices that remained open during lockdown did so to support their local communities. Sub-postmasters stepped up as key workers, not only keeping us connected but going above and beyond their job descriptions by offering services such as grocery deliveries for vulnerable customers. I thank them for their work during the pandemic, and also pay tribute to the CWU for its support and campaigning on post offices.

As this debate has shown, postal services matter to everyone, but customers and businesses in the most rural and vulnerable communities are paying the biggest price for closures. A 2015 freedom of information request revealed that, out of the 20 north-east branches marked as temporarily closed, 17 were closed for more than a year and seven for more than five years. To put that in context, the north-east has 499 open branches, already the lowest number in any UK region. Hon. Members have spoken of concerns about closures in their constituencies. In my own constituency of Newcastle upon Tyne Central, we have seen a number of closures, often in deprived areas such as Kenton, where I grew up. Other branches have moved into private sector operations, despite opposition from local MPs and residents. For example, the Gosforth high street post office was moved to a convenience store on a secluded residential street, without nearby bus stops or non-permit parking—a decision made with complete disregard for accessibility. We have heard from hon. Members of similar experiences in their constituencies. In 2019, the former Minister, the hon. Member for Rochester and Strood (Kelly Tolhurst), stated to the BEIS Committee that it was a Government commitment to maintain the post office network at 11,500 branches. Does the Minister plan to uphold that commitment in our post-pandemic economy?

With only 1% of branches managed directly by the Post Office, many sub-postmasters are relying on the Government’s subsidy to remain financially viable. However, sub-postmasters are resigning at a faster rate than they can be replaced due to the difficulty in making a decent living. That has been a major driving force in the decline of the network. In 2019, the National Federation of SubPostmasters found that 76% of members were struggling to earn the national minimum hourly wage, resulting in an estimated 22% planning to downsize or close their post office in the coming year. What recent discussions has the Minister had with Post Office Ltd on the incomes of sub-postmasters, and what steps he is taking to minimise the risk of further closures?

During the pandemic, reduced footfall and post offices’ inability to access many coronavirus support packages saw many temporary closures become permanent. Between March and April 2020, the number of open branches fell by 651 from 11,638, and 388 of those closures were of outreach services in the most remote parts of the UK. In August, the BBC reported that 260 temporarily closed branches were still closed as of 30 June 2021. What steps is the Minister taking to ensure that the number of open branches returns to pre-pandemic levels?

The post office subsidy provides a fixed amount of remuneration to an estimated 5,000 post offices, including 1,600 outreach services operating from mobile vans and village halls on a part-time basis. But the Government have ignored the importance of the subsidy, which has decreased from £210 million in 2012-13 to £50 million in 2020-21. Two years ago, the hon. Member for Rochester and Strood told a Select Committee that the Government would look to continue to support the post office network, sharing this responsibility with Post Office Ltd. Much has changed since this pre-pandemic statement. What assessment has the Minister made of the ongoing impact of covid on post offices, and how does he plan to fulfil that promise in the future?

Last year I welcomed the announcement of a £227 million investment, including a £50 million subsidy to support the rural post office network. However, the CWU rightly stated that it is unlikely that this investment will be sufficient given the amount the post office will have to raise to cover future legal claims associated with the Horizon scandal, which remains the greatest public scandal that our country has suffered, and the implications of which are still being felt by many current and former sub-postmasters who are struggling to gain the compensation the Minister seemed to promise. The more than 900 false prosecutions resulting from the Horizon scandal destroyed lives, families and reputations, and we have yet to see public confidence restored. Indeed, I do not believe that public confidence will be restored without justice for those whose lives were ruined. The Government must ensure that this justice does not come at the expense of our post office network’s survival. What steps is the Minister taking to maintain the financial viability of the Post Office, and will considerations be made for the continuation of the subsidy beyond 2022?

Finally, many Members have spoken about the importance of access to cash. It is worth noting that the subsidy I have spoken about is for the rural networks, but with 55 banks closing every month and up to 8 million people relying on cash daily, the impact of closures on access to cash in both rural communities and urban ones such as my own must be considered. The post office network provides financial services to individuals who are digitally excluded, are ineligible for a bank account, or use cashless services. In 2019, a report by LINK found that 47% of the UK population believes that losing that access to cash would present real challenges. Despite that, 10% of free-to-use ATMs were disconnected during the pandemic, further exacerbating the lack of access. Post offices have been left to pick up the slack, with recent figures suggesting that they will shortly exceed £3 billion a month in cash deposits and withdrawals for the first time in history, so I ask the Minister what assessment he has made of the impact of bank closures on the importance of the post office network, and what plans he has to ensure that banks offer support to post offices that take up their services.

As we have heard, post offices across the country offer more than commercial services: they are a source of social interaction for the vulnerable and lonely, a key touchpoint between people and Government services, and a vital part of local communities. The Post Office is a great British institution that has fulfilled a social purpose for centuries, but it is also an institution that the Government are failing to support. Managed decline is the story of our times under the Conservative Government. Labour is committed to protecting our post office network, and will fight to ensure that postmasters are given the support that is needed to guarantee that network’s survival. I hope the Minister will join us in that mission.

[Mr Clive Betts (in the Chair)]

I ask the Minister to allow two minutes at the end for the mover to wind up.

Gas Prices and Energy Suppliers

Chi Onwurah Excerpts

Thursday 23rd September 2021 Commons Chamber

[Kwasi Kwarteng]

Nobody in this House has been as consistent and as focused on this issue as my hon. Friend. He knows that, as Energy Minister, I commissioned the offshore transmission network review, on which we have accelerated work. I would be happy to speak to him and other colleagues about the review’s progress.

[Chi Onwurah (Newcastle upon Tyne Central) (Lab)]

The Secretary of State describes small energy companies such as Green in Newcastle upon Tyne Central as “failures,” but he says nothing of his own failure in structuring, regulating and shaping the energy market. Will he confirm that large energy companies, such as Green, will not receive a penny of taxpayers’ money? What support will he offer to the employees of Green, apart from slashing universal credit?

[Kwasi Kwarteng]

As I said, it has been a consistent feature over the past few years that energy companies have failed and left the market. We have a process to deal with that, the supplier of last resort. I categorically say to the House that we will not be giving any grants or subsidies to larger companies.

Subsidy Control Bill

Chi Onwurah Excerpts

2nd reading
Wednesday 22nd September 2021 Commons Chamber

[Chi Onwurah (Newcastle upon Tyne Central) (Lab)]

It is a pleasure to respond to the debate, which in general has been a very considered and well-informed debate with some excellent contributions. We heard from the SNP spokesperson, the hon. Member for Aberdeen South (Stephen Flynn), the hon. Member for Aberdeen North (Kirsty Blackman) and the hon. Member for Richmond Park (Sarah Olney) about the many gaps in the Bill, while the right hon. Member for East Antrim (Sammy Wilson) highlighted concerns over the Northern Ireland protocol, which I will also mention in my contribution. Even the contributions from the Government Benches highlighted some of the issues and challenges with the Bill.

I start by echoing the concerns raised by my hon. Friend the Member for Feltham and Heston (Seema Malhotra) in her excellent contribution at the start of the debate regarding the lack of female representation on the Business, Energy and Industrial Strategy ministerial team. It is disappointing not to see balanced leadership, particularly in a Department working on such critical issues as increasing diversity in science, technology, engineering and maths and increasing start-up businesses among female entrepreneurs.

We recognise the need for legislation in the area of subsidy control to meet our commitments under the trade and co-operation agreement, and to ensure subsidies are provided to businesses with appropriate safeguards in place. It is clear that the current temporary arrangements are insufficient and have not provided the clarity that businesses and public bodies need. We also recognise that a new regime will allow local authorities and others to make some subsidy decisions more quickly under a simplified process than under the EU regime, and it is welcome that we are moving away from a system of advanced notifications towards one of self-assessment against a set of common principles. However, there are substantial issues with the Bill that have been raised in this debate.

[Alex Sobel (Leeds North West) (Lab/Co-op)]

Considering some of the procurement practices during covid, particularly for personal protective equipment, is my hon. Friend not concerned about the lack of definition around subsidies of “interest or particular interest”, which might create the appearance or the actuality of cronyism, considering the Government’s record?

--- Later in debate ---

[Chi Onwurah]

As always, my hon. Friend raises an excellent point. Indeed, he anticipates a couple of points I will be making. It is certainly the case that we should not leave this Government to define their own procurement principles. The Bill as it stands leaves a significant amount to secondary legislation. The balance between the efficiency of the system and the need for effective oversight, and, most importantly, the role for the devolved Administrations in developing and implementing the new system, are all important gaps.

First, as with previous Bills, including the National Security and Investment Act 2021, important aspects are left to secondary legislation. Public bodies need guidance on how to interpret the subsidy control principles, as we heard from Members during the debate. There is also little clarity on how the Bill will support the UK’s most deprived regions, which is something that was built into the EU state aid regime through the assisted areas system. The Bill was a key opportunity to spell out what levelling up actually means, but the Government have not risen to that challenge.

Secondly, there needs to be a balance between oversight and efficiency. An expedient system is vital, but we must be clear that any subsidy regime comes with the risk of market distortion and unfair discrimination, which is why the ambiguity regarding interested parties is a concern. It is also important to consider the role of the CMA’s subsidy advice unit and particularly to ask whether its lack of investigative and enforcement powers is appropriate. We will work with the Government to ensure that the right balance is struck. I hope that the Minister will provide more clarity when he winds up.

Finally, our most serious concern about the Bill relates to the role for the devolved Administrations in the new system. We have heard from Members across the House, as we did during the passage of the United Kingdom Internal Market Bill, that yet again the Government have given the matter little consideration. The Secretary of State’s intervention on that point did not provide the clarity that he seemed to think.

We recognise that subsidy control is a reserved matter, but the wider context cannot be ignored. Devolved Administrations have important powers in the area of economic development, so the Government need to tread carefully. Leaving so many areas to secondary legislation only means that there will be no requirement on the Secretary of State to consult the devolved Administrations when developing the system. The same point applies to the Secretary of State’s ability to call in subsidies. We are clear that the devolved Administrations must have an explicit role in developing and implementing the UK’s subsidy regime as part of a four nations approach.

[Stephen Flynn]

Will the hon. Lady give way?

[Chi Onwurah]

I am afraid not. I have to make progress and I have very little time. [Interruption.] The hon. Member has intervened on a number of occasions, and I am afraid that I need to make progress.

We recognise the need for the Bill to replace the insufficient current arrangements, but although it significantly increases the speed and ease with which public bodies can grant subsidies, the key question, as we have heard again and again, is what the Bill is for. We have still not had an answer. As my hon. Friend the Member for Feltham and Heston said, we lag behind our G7 neighbours in granting subsidies to our businesses. Speeding up the system will benefit businesses only if there is a proper plan in place. That is where an industrial strategy could step in, providing the framework for the Government to set priorities, target deprived areas and boost business investment.

Labour has set out a plan to make, sell and buy more in Britain. From green jobs in manufacturing electric vehicles and offshore wind turbines to FinTech, digital media and film, we must grow businesses and industries that are fit for the future. The use of well-designated, proportionate subsidies would be critical to that plan. Instead, thanks to the Secretary of State’s ideological aversion to industrial strategy, we have no clarity on how or where public money will be spent. I urge the Minister to give close consideration to the points that we have raised.

Oral Answers to Questions

Chi Onwurah Excerpts

Tuesday 21st September 2021 Commons Chamber

[Chi Onwurah (Newcastle upon Tyne Central) (Lab)]

I welcome the Minister to his position.

The Prime Minister’s climate change spokeswoman recently announced that she would not be buying an electric car because of the lack of charging infrastructure and battery capacity. In 2018 the UK produced a quarter of Europe’s electric vehicles, but that is set to fall to just 4% by 2030. Motor manufacturers predict that tens of thousands of good jobs will be lost.

Will the Minister confirm that even if he meets his own targets, by 2025 the UK will have only 7% of the battery production capacity of Germany? Germans receive grants of up to €9,000 to buy an electric car, three times what he is offering. What will he do to deliver the battery capacity that is needed to secure British jobs, and make electric cars affordable? Does he understand what affordable means?

[Lee Rowley]

We absolutely understand what affordable means, and we are absolutely committed to building an industry that supports batteries in the United Kingdom, ensuring that the transition to electric vehicles will take place within a short period. I am happy to talk to the hon. Lady more about that if she wishes.

Help to Grow: Digital

Chi Onwurah Excerpts

Monday 20th September 2021 General Committees

[Chi Onwurah (Newcastle upon Tyne Central) (Lab)]

It is a great pleasure to serve under your chairship, Sir George. I welcome the new Science Minister to his position; I hope he stays around long enough to ensure that we have a long-term plan for science, which has been sorely missing.

I thank the Minister for his opening remarks, in which he laid out some of the challenges and problems in productivity and supporting business growth. As he said, we are debating a motion to approve £296 million of compensation over three years to digital technology product vendors for some of the costs of providing technology to SMEs as part of the “Help to Grow: Digital” programme. The programme will provide advice on how technology can boost a business as well as discounts of up to £5,000 on approved software for boosting sales and for day-to-day management.

Support for SMEs is essential to rebuilding the economy after the pandemic. Britain has almost 6 million SMEs, and many need help to grow. They drive innovation, take risks and collectively employ 16 million people—nearly two thirds of the workforce. Growing SMEs means growing the economy, more jobs and more choice for consumers, so Labour believes strongly that small businesses should be at the heart of the recovery from covid.

We are worried by the drop in new start-ups, which are down 11% since 2016. In April, Labour promised £1 billion of funding to support the creation of 100,000 start-ups across the country in the first term of a Labour Administration. Unfortunately, the Government have used the pandemic to give away taxpayers’ money for little return, often without a proper tendering process and in some cases to people with direct connections to Ministers. For that reason, we should all be hyper-vigilant about how the Government are spending money.

The motion refers to one part of a two-part programme of support. “Help to Grow: Management” was approved in May. Will the Minister up the Committee on the scheme’s progress? How will “Help to Grow: Digital” work with the previous programme, or are they completely separate? Can companies take advantage of both? I hope that all SMEs will take advantage of the new programme, and it will come as no surprise to the Minister that Labour will not oppose the motion. We support funding to help SMEs be successful. We want the programme to be successful and to deliver on its aims of supporting productivity and growth while providing value for money for the taxpayer.

It is on the latter point that the Government have been reticent of late, so I have a number of questions for the Minister. First, I want to ask about the limits of the programme, and specifically whether it extends to charities, mutuals, co-operatives and other organisations that need to grow and have significant economic outputs and make a significant contribution to our economy. As this is taxpayers’ money, it seems reasonable for the scheme to cover all manner of organisations that taxpayers are engaged with. Charities in particular have taken a hard hit from the pandemic, with reduced fundraising and many taking on vital local government functions following years of funding cuts.

Secondly, what has been the take-up of the scheme? It has been open for registration since March. How many SMEs have registered, and how many do the Government expect to register in future? What measures are being applied to ensure that businesses that are under-represented by sector, female-led and ethnic minority-led businesses, or businesses led by disabled people, are accessing the programme? Furthermore, given the Government’s commitment to levelling up—we have a new Department with that in its title—what provisions are there to ensure that this funding makes its way across the country rather than focusing on growth in London and the south-east? What is the Minister doing to encourage regional take-up?

I was so impressed by the speed at which Grainger Market in my constituency responded to the lockdown, with many traders moving online within three weeks of lockdown to ensure that their businesses survived. It is not to be expected that, in those three weeks, they managed to obtain all the digital skills they needed. Yet, according to the online guidelines, many market traders can be excluded if they have fewer than five employees. The Government may want to go back to the past of imperial weights and measures, but the market traders in my constituency are looking to the future, and digital, and they will not be happy to find that the Government are not interested in helping them.

Thirdly, will the Minister inform us of the procurement process for the technology that the £296 million is for? He has spoken a little bit about the success of the vendor process so far, but how were the digital technology vendors selected and how were the particular technologies selected? Are the technologies purchased at the high street price or have discounts been achieved? I asked a written question last week about what the marketing budget for the programme was, but was told only the total budget in response. Can the Minister tell us what proportion of this budget is for the technology and what proportion is for other costs such as marketing? He mentioned the need to get to hard-to-reach businesses, and I have talked about the need to reach businesses across the country, so is there a marketing budget, and if so, what is it?

Fourthly, I would like to ask about sector-specific digital technologies. Does the programme make provision for digital technologies that specific businesses may need to grow? These include, for example, those in our wonderful creative industries, which were so successful at last night’s Emmys. I worry that there is something of a one-size-fits-all approach. While there are many things that are common to SMEs, such as basic accounting, others may need more tailored support. What is the Minister doing on digital inclusion for businesses? The Government seem very happy to leave it to Google and Facebook, and their programmes, which I support, but they do require businesses to use Google and Facebook products. What are the Government doing more generally on digital inclusion?

On the value-for-money point, can the Minister set out how the impact of this spending will be measured? Does the Minister have an estimate of the multiplier effect of the spending at this stage? How are the Government intending to measure the productivity impact of a programme? Over what timeframe would we expect to see a return on the spending? Will the Minister report to the House on the impacts of the programme?

Finally, there is a wider question on the conditions for success external to this programme. SMEs have had a difficult time during the pandemic, with many, such as those in hospitality, having to effectively go into hibernation during lockdowns. With cases of covid-19 still very high, there is always a chance of further impacts in the future too. Many SMEs are in debt having taken out Government loans and so on, or are facing rent arrears and even problems hiring staff because of the double impact of the pandemic and leaving the European Union. If businesses do not have support on these fundamental features of any business, my concern is that spending money on digital may prove fruitless or more likely that the programme will be taken up by businesses that are already doing well while others suffer.

What are the Government doing to ensure that there is a suitable business support environment enabling the Help to Grow scheme to have an appropriate impact? Will the Minister say a little bit about the scope of that impact? As I have said, there are 6 million SMEs in this country. The maximum number of SMEs that may be impacted by this programme will still be a relative drop in the ocean among the SMEs we have. How does he expect that to truly make a difference to our economic success and productivity?

I look forward to the Minister’s response. As I said, we will not oppose the motion.

--- Later in debate ---

[Chi Onwurah]

I thank the Minister for giving way. I did not express any pessimism about our fantastic businesses and economic opportunities. I was talking about some of the figures for business start-ups in the last few years, which I hope he recognises.

[George Freeman]

Having a run a few myself, as colleagues here have, I am all for them. I simply make the point that we are the fastest growing economy in the G7, so we must be doing something right. The hon. Lady is right to highlight, as this measure does, the importance of SMEs.

This is a targeted measure. We are not trying to boil the ocean; we are trying to target specific funding at businesses for which all the evidence shows that the uptake of digital technologies such as those I have described will have maximum impact in terms of productivity and competitiveness. A number of us have started companies. Very often in the first three, six, nine or 12 months we find that digital technology is not necessarily the biggest barrier to getting going. It is important, but we are doing here is focusing where all the evidence from the business community suggests that support for digital uptake will have the biggest.

I will take the questions in turn. First, this is designed specifically for businesses, so charities are not eligible, but I am delighted to say that all social enterprises—businesses that recycle their profits back into good causes—are eligible, which sends an important message.

Newport Wafer Fab Sale

Chi Onwurah Excerpts

Thursday 15th July 2021 Commons Chamber

[The Parliamentary Under-Secretary of State for Business, Energy and Industrial Strategy (Amanda Solloway)]

Of course, Mr Speaker. The Government recognise Newport Wafer Fab’s value as a company, and its contribution to consortia based at the south Wales compound semiconductor cluster. The Government are committed to the semiconductor cluster and the vital role that it plays in the UK’s economy. The Welsh Government have previously provided financial support to the company, as economic development is devolved and the responsibility of the Welsh Government.

Under the Enterprise Act 2002, the Government have powers to intervene in mergers and takeovers that raise national security concerns. We have recently strengthened those powers in the National Security and Investment Act 2021, which is expected to come into force at the end of this year, but it is right that commercial transactions are primarily a matter for the parties involved. The Government have been in close contact with Newport Wafer Fab, but do not consider it appropriate to intervene in this case at the current time.

We will continue to monitor the situation closely, and, as part of that, the Prime Minister has asked the national security adviser to review this case. Separately, work is under way to review the wider semiconductor landscape in the United Kingdom. As I am sure the House will appreciate, I am unable to comment on the detail of commercial transactions, or of any national security assessment of a particular case.

[Chi Onwurah (Newcastle upon Tyne Central) (Lab)]

I congratulate the hon. Member for The Cotswolds (Sir Geoffrey Clifton-Brown) on securing the urgent question.

Newport Wafer Fab is a symbol of British innovation and world-class employment—not just its 450 employees but the wider regional semiconductor cluster. It is also a testament to the long-term role of public investment in strategic economic planning by the Welsh Government, so the priority must be to secure a viable long-term future for what is the UK’s largest semiconductor manufacturer. With European automotives protesting over chips shortages and promising to ramp up domestic production, it is clear that Newport Wafer Fab is a strategic economic asset.

Labour welcomes investment in the business, as we welcome almost all inward investment in thriving British industries, but, given the importance of semiconductors to our country’s critical infrastructure, there is a clear case for examining this on national security grounds, and it is a pity that the Minister did not make it. Global competition to secure microchip development is accelerating. Our national security interests require a strong position in this contested market, so how will the Minister now ensure that this vital national economic and technology asset is protected? Will she use the powers in the National Security and Investment Act 2021 to urgently scrutinise this takeover? If the sale is blocked on national security grounds, will the Government work creatively and urgently to secure the financing that the business needs? All options must be kept on the table, including a role for potential public equity investment.

As Labour argued during the passage of the NSI Act, the Government have consistently outsourced British national security and economic interests, because Ministers have prioritised market zeal over British security, as in 2012 when they let the Centre for Integrated Photonics, a prize British research and development centre, be taken over by Huawei. That is why Labour is calling for the national security and public interest test regime to be strengthened. This is a critical test of whether the Government are willing to use these new powers or not, which goes to the heart of what kind of industrial strategy we have and what kind of country we want to be.

[Amanda Solloway]

As laid out in the integrated review, China is a systemic competitor. The scale and reach of China’s economy, the size of its population, its technological advancement and increasing ambition to project its influence on the global stage, for example through the belt and road initiative, will have profound implications worldwide. Open, trading economies such as the UK will need to engage with China and remain open to Chinese trade and investment, but they must protect themselves against practices that have an adverse effect on prosperity and security. Co-operation with China is vital in tackling transnational-type challenges, particularly climate change and biodiversity loss.

The UK wants a mature, positive relationship with China, based on mutual respect and trust. There is considerable scope for constructive engagement and co-operation, but as we strive for that positive relationship, we will not sacrifice either our values or our security. It has always been the case that where we have concerns, we will raise them, and where we need to intervene, we will. The Government have a range of legislative and regulatory powers to protect infrastructure and critical services, including the new National Security and Investment Act 2021. The NSI Act is nation-agnostic: acquisitions should be considered on a case-by-case basis, which will help to ensure that the Act is not discriminatory and that we uphold our World Trade Organisation obligations.

Space Debris

Chi Onwurah Excerpts

Wednesday 14th July 2021 Westminster Hall

[Chi Onwurah (Newcastle upon Tyne Central) (Lab)]

It is a great pleasure to serve under your chairship, Mr Dowd. I thank the right hon. Member for Kingswood (Chris Skidmore) for having secured this important debate, and I pay tribute to him for his work as the vice-chair of the parliamentary space committee and thank him for his analysis of the issues around space debris, as well as the space history lesson. Space is such a fascinating topic, and every time we discuss it in this House, it never fails to inspire awe and excitement. Britain has a proud history of space exploration. In fact, to add to the history that the right hon. Gentleman set out, the British Interplanetary Society is the oldest space advocacy organisation on Earth; there may be other, older ones elsewhere of which we are not aware.

Here on Earth, as we aim to enter, as the right hon. Gentleman set out, a more socially conscious era of green growth, protecting and keeping our Earth and seas clean is commonly discussed, but rarely do we look up and think about how clean the sky beyond the Earth’s atmosphere is. That is one reason why this debate is so important—because we are addressing an under-discussed topic on which the Government have failed to provide direction, and exploring the opportunities, as set out so eloquently by the right hon. Gentleman, that may arise from the need to address space debris.

I will not repeat all the statistics that the right hon. Gentleman set out, but it is striking that there are more than 900,000 objects currently orbiting the Earth, with 23,000 of those being pieces of man-made debris larger than 1 cm. Since 1957, there have been 10,680 satellites launched into Earth’s orbit, with around 6,250 still in space, which is impressive, but only 3,700 are still functioning. If any two were to collide, the result could be catastrophic, creating thousands of new pieces of dangerous space junk, as the right hon. Gentleman set out. These objects could stay in orbit for hundreds of years, putting at risk working satellites that people depend on for everyday services.

The threat is not only far above our heads. In May this year, an 18-tonne chunk of metal that was once the core stage of a Chinese Long March 5B rocket crashed down to Earth, narrowly missing the island of the Maldives. Last year, research for the International Astronautical Congress revealed that the 50 most dangerous objects currently in orbit were all large rocket boosters, mainly from Russia, left drifting around our planet.

As the right hon. Gentleman suggested, the removal of hazardous materials on Earth or in space presents a significant commercial opportunity. A joint venture between the UK and Japan, the Tokyo-based firm Astroscale, which has control centres in Oxfordshire, launched two rockets to begin the process of cleaning up some of the 9,000 tonnes of space debris. I am pleased that it is leading the way. What discussions has the Minister had with Astroscale, and what steps is she taking to support the British-based clean-up firms of the future? I am pleased that at the G7, as the right hon. Member for Kingswood alluded to, the UK joined our allies in Canada, France, Germany, Italy, Japan, the EU and the US to take action to tackle space debris. Those nations agreed that we need global standards on space debris and committed to the long-term sustainable use of space. However, what will that look like in real terms? Can the Minister tell us when we will see a long-term, sustainable plan for space debris? For that matter, can she tell us when we will have a space strategy?

The space industry generally is worth more than £14.8 billion per year and has grown at a rate five times greater than the wider economy since 1999. The success of this sector helps to drive prosperity across the UK. UK space businesses spend around £750 million annually, with around 1,500 UK suppliers based across every region of the UK. Many of the jobs created in space manufacturing are also highly productive, with the average salary of an Airbus UK space employee, for example, standing at £51,000—nearly 50% higher than the UK national average. The UK’s proud history in space exploration, research and development makes us an excellent launchpad for future growth and for leadership in the space debris domain.

The UK and its place in the world are changing. We have left the European Union, which meant turning our back on the Galileo project that we did so much to bring about, at an estimated cost of £1.2 billion to the taxpayer. The Government then U-turned on plans to develop a rival, sovereign GNSS system, at a cost of a further £60 million. Can the Minister tells us the status of our sovereign satellite navigation capability? The right hon. Member for Kingswood set out the possible impact on our economy of space debris reducing or stopping GNSS services.

The Secretary of State has decided to take control over strategy and policy away from the UK Space Agency, handing the almost £600 million budget directly to the Government. Yet, as I have mentioned, we remain without a long-term, specific space sector deal and have not received an update on the space growth partnership since its launch in March 2018. Will the Minister tell us what progress has been made by the Space Growth Partnership in achieving its stated aim of the UK making up 10% of the global space market by 2030? What role does she see space debris clean-up playing in that partnership and in that growth? What analysis will be conducted of the market risks and national security risks that the right hon. Member outlined?

The Government talk excitedly about global Britain, but Labour wants to see an interplanetary Britain, powered by a booming space sector. Space is not just for the stars; it impacts every household in the country. From climate change and rural broadband to transport and agriculture, from our smartphones to our credit cards, the UK space sector helps us all prosper. The satellites at risk from space debris are central to providing those services.

The Government have failed to come forward with a clear, long-term space strategy to fully unlock the potential of the sector. Without such a strategy, the hard work of our space sector—developing spaceports, rocket launchpads, space domain awareness projects, military grade software and satellite projects that are critical for our vital infrastructure—cannot be fully realised. If we are to ensure the success of those programmes, we must understand whether we have the industrial capability to do so. Part of unlocking the potential of our space industry is knowing how we utilise our industrial base to achieve our goals, and in turn where we need further investment and finance to encourage outward investment by UK businesses.

There is no strategy for external investment or for skills—in particular, diverse skills. The space sector needs the skills of everyone, regardless of gender, ethnicity, religion, region or age, and it is not as diverse as I am sure the Minister would like. There is no strategy for that. There is no strategy for industry and manufacturing, for sovereign navigation satellite capabilities or for whether and how we will compete with SpaceX and others. Instead, we have the manifesto of a Government who have their heads in the clouds—they certainly do not have a strategy for space. Down on Earth, the sector is still waiting to hear about the future of the new regulations introduced under the Space Industry Act 2018, particularly those dealing with administrative burdens and liabilities.

Nothing better illustrates the lack of strategy and transparency than the purchase of OneWeb despite the advice of experts and the concerns of the UK Space Agency. First we were told that it would be a part of our sovereign GNSS programme, but then it was not. We still do not know what the Government have planned for OneWeb. We heard that it may be part of our approach to space debris. We do not know whether that huge investment will ever support jobs in the UK space sector if the satellites continue to be manufactured in Florida. I would appreciate it if the Minister gave some clarity on the space strategy generally and specifically on OneWeb.

The space sector provides the UK with many opportunities to grow our economy, push technological boundaries and boost our soft power by developing strategic interdependence with our allies, which I very much support. I am pleased that the right hon. Member for Kingswood secured this debate, but as the Minister for space until 2019, he oversaw and was responsible for many of the policies that he referred to and the lack of an ongoing, sustainable strategy, or indeed any strategy, for our space sector.

A year ago, UKspace set out the urgent need for a coherent, cross-Government space strategy, and we have still not seen one. Labour would seek to support our sovereign capability in the space age and build on the UK’s proud history of technological innovation and space exploration. Labour is passionate about the long-term future of the space sector and its potential to provide high-skill, high-paying jobs across the UK and step up to deliver a long-term sustainable strategy for managing space debris with UK businesses and our national security at the heart of this interplanetary clean-up.