Oral Answers to Questions

Kemi Badenoch Excerpts

Thursday 2nd May 2024 Commons Chamber

[Andrew Jones (Harrogate and Knaresborough) (Con)]

12. What progress she has made on supporting businesses to reach £1 trillion in annual exports.

[The Secretary of State for Business and Trade (Kemi Badenoch)]

UK exports were £862 billion in the 12 months to February. UK services exports reached a record £472 billion in the same period, which is an increase of 10%—they went up by £42 billion. Businesses, including small and medium-sized enterprises, can access my Department’s wealth of export support at great.gov.uk. That support includes the UK Export Academy, which has had more than 18,000 registrations; our 160 international trade advisers, who help about 6,000 SMEs each year; and 388 export champions, across every part of the UK.

[Sir Desmond Swayne]

Are we really the fourth largest exporter in the world?

[Kemi Badenoch]

I am pleased to tell my right hon. Friend that we are. There are many, many more good statistics, which he will find in the publication my Department produced at the end of January; it contains further good news stories on UK exports. The UK is a global exporting superpower and the world’s second biggest services exporter. Services exports to the European Union are at a record high and have increased by 36% since 2018.

[Andrew Jones]

My right hon. Friend has just detailed very encouraging data, much of which results from the hard work of SMEs. Will she give a bit more information about what support is available specifically to SMEs to help them grow and export more of their products and services?

[Kemi Badenoch]

The Department has declared this year the year of the SME. People often hear news that sounds as though it is just about big business, but SMEs employ most of the people in the UK. We have a network of 160 international trade advisers and our export support services. We have also put in place schemes such as a Help to Grow management course, which 5,290 participants had completed by November. We also have a business support service, which provides support to about 30,000 people in England every year.

[Gerald Jones (Merthyr Tydfil and Rhymney) (Lab)]

Further to those comments about SMEs, in the light of the termination of the trade show access programme, which supported SMEs in gaining international market exposure, what is the Government’s strategy to provide equivalent or enhanced support to ensure UK food products remain competitive within EU markets?

[Kemi Badenoch]

We know that a lot of people are disappointed that we closed the trade show programme, but it was a pilot programme and it did not yield the business successes that we had hoped. We are investing in those things that are providing success and demonstrating real benefits. The UK Export Academy is one of them, along with the export support service, as I mentioned, and the international trade advisers. Many of them will have expertise in food and drink. If the hon. Gentleman writes to us with a specific case, we will be happy to help.

[Mr Speaker]

I call the shadow Minister.

[Gareth Thomas (Harrow West) (Lab/Co-op)]

Unfortunately for Government Members, and more importantly for the country, the Office for Budget Responsibility’s recent figures, which I know the Secretary of State struggles with, show that exports have dropped on her watch and are set to have declined again this year. If she has a moment to spare from her leadership campaign, she might read the landmark report published by Aston University last week on the significant boost for British exports that a veterinary agreement could deliver through British farmers and the agrifood industry. Why will she not pursue an agreement that is so obviously in Britain’s national interest?

[Kemi Badenoch]

The OBR puts out lots of figures and the Opposition cherry-pick the ones they think will be most helpful, thinking that we have not done our homework. I encourage the hon. Member to look at the OBR forecasts for growth for this country, which are very high, and I ask him which specific period he is referring to. He should look at what has happened to exports overall, not just periods including covid, which explain why we have had some drops in food exports.

[Gareth Thomas]

I asked the Secretary of State about the veterinary agreement; I suspect no one on the Opposition Benches will be surprised that she has not shown any interest in a trade agreement that would help British farmers. According to the House of Commons Library, under the last Labour Government exports rose by 55%, but since then exports have risen by only 32%. Is the truth not that British exporters always do better under a Labour Government?

[Kemi Badenoch]

That is absolute rubbish. It is not true. The veterinary agreement that he is talking about would create dynamic alignment with the EU, which is not what this country voted for in 2016. We are delivering what the people voted for. Yes, there will be difficulties—we are sorting them out. It is time that the Opposition moved on and accepted the will of the people.

[Sir John Whittingdale (Maldon) (Con)]

5. What recent progress her Department has made on negotiating a free trade agreement with South Korea.

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[Neale Hanvey (Kirkcaldy and Cowdenbeath) (Alba)]

7. What recent discussions she has had with the Scottish Government on the promotion of Scottish products in overseas markets.

[The Secretary of State for Business and Trade (Kemi Badenoch)]

My Department works closely with the Scottish Government and their agencies to promote Scottish products in overseas markets. We have recently delivered our Made in Scotland, Sold to the World exporter roadshow in Glasgow. On top of that, I am pleased to say that the PG Paper Company, a brilliant Scottish business, has just received an award in this year’s Made in the UK, Sold to the World awards.

[Neale Hanvey]

The value of Scotland’s oil exports to the EU reached £9.4 billion in 2023, with total oil exports up 14.7%, so the value of oil as an export commodity cannot be overstated. Those billions of pounds in exports can be balanced against the modest £80 million investment that would increase Grangemouth’s profitability threefold, secure its long-term future and save Grangemouth from closure. Does the Secretary of State accept that it would be absurd for Scotland to be the only major oil-producing nation without a refinery capacity, and will she agree to meet me to discuss this matter further, given that the Scottish Government are otherwise occupied?

[Kemi Badenoch]

The hon. Gentleman is right to raise this issue. It is something that we are concerned about and the UK and Scottish Governments are working together to understand all the options for the future of the refinery, and working closely on the issue through forums such as the Grangemouth Future Industry Board. I am very happy to meet him—as are other Ministers—to discuss this matter further.

[David Mundell (Dumfriesshire, Clydesdale and Tweeddale) (Con)]

Does the Secretary of State agree that, while there has been great progress in promoting and increasing the export of traditional Scottish products, such as whisky, we also need to support new businesses, such as one in South Lanarkshire that is keen to expand electronic vehicle infrastructure into the United States?

[Kemi Badenoch]

Yes, my right hon. Friend is quite right: our exports need to be about the future, not just about the traditional industries, such as Scottish whisky, which are the pride of Scotland and of the UK. Electric vehicles are one way that we will hit our net zero target, and this is an area that the Department for Energy Security and Net Zero is focused on and that I support in Business and Trade. If there is anything specific that we can look into for his constituency, we would be very happy to help.

[Stephen Kinnock (Aberavon) (Lab)]

8. What steps she is taking to support jobs in steel supply chains.

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[Greg Smith (Buckingham) (Con)]

13. What recent progress she has made on increasing levels of trade with the United States.

[The Secretary of State for Business and Trade (Kemi Badenoch)]

Over the past two years, UK-US trade has grown 35% from £230 billion to £311 billion, while shared investment between our two nations now totals over £1.1 trillion. In March, following the excellent work of our trade envoy, my right hon. Friend the Member for Bournemouth West (Sir Conor Burns), I signed a state-level arrangement with Texas. That means that UK businesses now have memorandums of understanding with eight US states with a combined GDP equivalent to a quarter of the whole US economy.

[Greg Smith]

I am delighted to report that US motorsport giant Andretti has shown a massive vote of confidence in the UK by taking 40,000 square feet of facilities in Buckinghamshire, with another 70,000 square feet on order, and is already employing over 100 people locally in high-tech jobs. That clearly opens up huge opportunities for automotive and motorsport supply-chain businesses on both sides of the pond, including General Motors. Will my right hon. Friend join me in welcoming Andretti to the UK in its bid to get on to the Formula 1 grid, and what more can she do to ensure that automotive and motorsport supply chains can operate on both sides of the Atlantic?

[Kemi Badenoch]

I was delighted to see my hon. Friend visit the opening of Andretti Global’s new facility in Silverstone last month. I wish it luck as it continues its preparations to enter Formula 1. That investment is another vote of confidence in the world-leading innovation that the UK has to offer. Andretti Global will also specifically benefit from the MOU that we have signed with Indiana, which will enhance our trade relationship in key areas, including advanced manufacturing.

[Patrick Grady (Glasgow North) (SNP)]

14. Whether UK wine companies have sought advice from her Department on preparations for producing wine in pint measures under the Weights and Measures (Intoxicating Liquor) (Amendment) Regulations 2024.

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[Patrick Grady (Glasgow North) (SNP)]

T1. If she will make a statement on her departmental responsibilities.

[The Secretary of State for Business and Trade (Kemi Badenoch)]

Post Office governance is a priority for the Government, and I have said many times that it is vital that we have the right people leading that organisation. I am therefore pleased to tell the House that, on Wednesday, I announced the appointment of Nigel Railton as its interim chair. Having previously been chief executive of Camelot, Nigel brings a wealth of experience of transforming organisations, and I am confident that he is the right person to lead the Post Office through this period. Nigel Railton will take up his post as soon as possible, and will be invited to give Ministers his views on the future direction of the Post Office in due course.

[Patrick Grady]

When will the Government admit that their Brexit dream of people quaffing pints of wine and invoking the spirit of Churchill was always a fantasy, and that the reality is, in fact, a Brexit nightmare of border checks, reduced consumer choice and business closures?

[Kemi Badenoch]

It is nonsense to say that this reduces consumer choice; it actually increases consumer choice. I cannot imagine why anyone would be complaining about the sale of pints of wine. If the hon. Gentleman does not like them, he does not have to buy them.

[Dr Thérèse Coffey (Suffolk Coastal) (Con)]

T4. I know that my right hon. and hon. Friends in the Department have been looking into the closure of Kelsale post office, an outreach service in my constituency. Very recently, we voted through more money to subsidise the Post Office, including £50 million for rural branches. Will my right hon. Friend the Secretary of State make sure that that money is allocated? I know that the Post Office is trying to cut costs, but that should not be at the expense of customers in Kelsale.

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[Rushanara Ali]

Well, it is not working, and the Minister and the Secretary of State should take this seriously, because it is damaging our high streets and causing huge concern up and down the country. He and the Secretary of State should go and meet those businesses, and hear from them directly.

Turning to another issue, we have seen 14 years of Conservative under-investment in public infrastructure, a failure to provide certainty and a failure to get a grip on the economy. Business investment has also suffered. Had it matched the average investment levels of France, Germany and the US, our GDP would be nearly 4% higher today, and wages would have been boosted by £1,250 a year. Can the Secretary of State outline how she plans to fix this crippling investment gap, and what will she do to make sure businesses get the support they need so that we can get the economic growth this country desperately needs after 14 years of under-investment?

[Kemi Badenoch]

I remember a time when Labour Members were telling everyone that we should not invest in nuclear, and it is under this Conservative Government that we are investing in nuclear infrastructure. That has only happened under Conservative Governments. The hon. Lady asks about the plan. I would remind her about the global investment summit we had in November, which raised nearly £30 billion in one day. No one is better than our current Prime Minister at delivering inward investment for this country. Business investment is rising, and it is rising because of the policies that he and the Chancellor have put in place, such as capital expensing.

[Greg Smith (Buckingham) (Con)]

T5. Yesterday, I was pleased to meet a number of UK aerospace businesses demonstrating and showcasing extraordinary innovation right here in the United Kingdom, including Safran, which has a significant base in Pitstone in my constituency. Can I ask my hon. Friend what the Department has done to ensure that we can increase aerospace exports?

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[Kemi Badenoch]

As everyone on the Government Benches knows, even if we had a trade deal with the US, the hon. Member would be standing there telling us how he would be voting against it. The fact of the matter is that the US is not carrying out any free trade agreements with any country. There is nothing we can do about that, so instead we have been negotiating deals with states at an individual level, as I mentioned. For the last one, the governor of Texas came to the UK to sign a trade deal memorandum of understanding between Texas and the United Kingdom. Our relationship with the US is going well. I spoke about exports increasing, and our trade increasing to £311 billion. Trade with the US is going well. We will continue to pursue a free trade agreement, but trade requires two parties in order to deliver.

[David Mundell (Dumfriesshire, Clydesdale and Tweeddale) (Con)]

Are Ministers as concerned as I am about continued reports that Royal Mail is determined to move away from a six-day service? In a large rural constituency such as mine, with an older population, people continue to rely on the Royal Mail for important communications. Can the Minister make clear that that is not the direction of travel the Government want Royal Mail to go in?

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[Holly Mumby-Croft (Scunthorpe) (Con)]

Would it be acceptable if the UK became the only country in the G7 that could not make its own virgin steel?

[Kemi Badenoch]

My hon. Friend will know how committed this Government are to the steel industry, but at the moment it is going through a transition. We care about having primary steel-making capacity in this country—that is something we want to do and to keep, but as she knows, even now we still import ore. I know she is concerned about British Steel and its future. I will be visiting her constituency in Scunthorpe and we will be able to discuss those matters further.

[Stephen Kinnock (Aberavon) (Lab)]

T3. Yesterday, the BBC reported on expert analysis that has been submitted to the transition board, indicating that cutting 2,800 directly employed Tata Steel employees could lead to up to 9,500 additional job losses, due to the huge number of contractors and sub-contractors who are indirectly employed by Tata. When the Government handed £500 million of taxpayers’ money to Tata to do that deal, had they made a full assessment of the job losses: not just those directly employed by Tata who would lose their jobs, but the vast number of jobs that will be lost through the supply chains and contractors?

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[Kevin Brennan (Cardiff West) (Lab)]

When the Minister for Trade Policy, the right hon. Member for Chelsea and Fulham (Greg Hands), bragged to my hon. Friend the Member for Rhondda (Sir Chris Bryant) earlier that his trade envoys had to have a qualification of “diplomacy and discretion”, did he have in mind the former trade envoy to Colombia, the hon. Member for Fylde (Mark Menzies)?

[Kemi Badenoch]

If the Opposition want to make an accusation, they should go ahead and do so, rather than this playground game that they are playing, which is insulting to every trade envoy, on both sides of the House, who is delivering for this country.

[Richard Foord (Tiverton and Honiton) (LD)]

Green Resource Engineering Ltd, a highly successful company in Willand, already exports £1 million of engineering business to South Korea every year and has done so for the last six years. The managing director, Richard Booth, let me know that exporting to Korea is already straightforward; by contrast, getting parts in from Europe has become a real headache. Rather than fretting about a free trade agreement with Korea, how are the Government monitoring additional red tape after having left the European single market?

[Kemi Badenoch]

We have the most comprehensive free trade agreement with the EU—more than with any other country in the world—so that should not be the reason for difficulties in bringing in components. If the hon. Member has something specific that we can look at, I will be happy to take a look, but we have been doing everything to ensure that trade—in auto in particular—continues to boom, and it is booming. We were able to stop the issue with rules of origin, which was going to have a deadline at the end of this year. In terms of specific components that are having trouble getting across the border, I will need a bit more detail to provide him with an answer, but that is not about leaving the EU.

[Allan Dorans (Ayr, Carrick and Cumnock) (SNP)]

India is the second largest market for Scottish whisky in the world, making it an extremely important market for the Scottish economy. Currently, whisky exported to India has a 150% import tariff placed on it. What steps is the Secretary of State taking to ensure that, in any trade deal signed with India, that tariff is reduced?

[Sir Michael Ellis (Northampton North) (Con)]

Does my right hon. Friend agree that it would be odd and inappropriate for the United Kingdom to impose any form of arms embargo against Israel when His Majesty’s armed forces are in the region and working with Israel to provide humanitarian support, and the UK would expect Israel to help in the protection of His Majesty’s forces?

[Kemi Badenoch]

My right hon. and learned Friend makes a good point. The Prime Minister addressed this issue yesterday. I know that there is a lot of interest in arms exports to Israel, and yesterday my entire Department was blockaded by protesters, meaning that civil servants who needed to get to work could not do so. The Government continue to monitor closely the situation in Israel and the Occupied Palestinian Territories. All export licence applications are assessed on a case-by-case basis against the strategic export licensing criteria. The Government take their defence export responsibilities extremely seriously and operate some of the most robust export controls in the world.

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[Kemi Badenoch]

I am afraid that I do not have the details to answer that question. On the face of it, given the information I have, it is not something I have heard before, but we can write back with more information. However, it does not sound like that is the case.

[Tonia Antoniazzi (Gower) (Lab)]

In my constituency we have the fantastic company Selwyn’s, whose seafood is first class. It exports a lot; what is the Government’s current assessment of the export of cockles and other seafood in the Welsh market?

UK Trade Performance

Kemi Badenoch Excerpts

Wednesday 1st May 2024 Commons Chamber

[The Secretary of State for Business and Trade (Kemi Badenoch)]

With permission, I would like to make a statement on the UK’s trade performance.

When I am overseas, as Secretary of State for Business and Trade, other countries speak with nothing but admiration and respect for what we are achieving in Britain. As the chief executive officer of Nissan Global recently remarked:

“It is surprising to hear people asking why they should choose the UK”—

because, in his words,

“we have both great people and great talent here.”

Certainly, in the firms that I have visited up and down this country, I am proud to see our employers and exporters firing on all cylinders. Yet, when I return to Westminster, some people seem unaware of the progress that we have made as an independent trading nation. Today, I want to put that right.

The latest trade data, published by the Office for National Statistics and also by the United Nations Conference on Trade and Development, should give everyone in this House cause for celebration and renewed pride in our country. They confirmed that the strategy the public voted for on 23 June 2016 is delivering. Leaving the European Union was a vote of confidence in the project of the United Kingdom, and we are seeing results. Since that referendum, the UK economy has grown faster than that of Germany, Italy and Japan, and contrary to gloomy predictions, our manufacturing productivity has grown more than that of Germany, France, Italy and the USA.

According to the latest UN statistics, the UK, outside the EU, became the world’s fourth biggest exporter in 2022, overtaking Japan, the Netherlands and France. The value of UK exports was £862 billion in the 12 months to February 2024. That builds on progress we have made in growing our exports outside the confines of the EU. Exports are now 2% above 2018 when adjusted for inflation. Services exports are at an all-time high. A summary of these figures, along with the most recent business and labour statistics, were published on gov.uk in April. Together, they definitively disprove the claims of those who prophesied a catastrophic economic collapse when we left the EU to become a sovereign nation.

Today, we are selling not only more services to EU countries than ever before, but record amounts of services to the rest of the world, too. We are the largest net exporter of financial and insurance services in the world. Far from an exodus of businesses out of the UK, European firms have doubled down on their commitments to the UK. In 2020, Unilever chose to headquarter exclusively in London over Rotterdam. Since 2022, Cadbury has brought more chocolate production back to the UK from Germany. In the same year, Shell moved its headquarters out of the Netherlands and into the UK.

We are tearing down the barriers to trade. Since the start of 2022, we have resolved barriers all over the world, estimated to be worth more than £15 billion to UK businesses over a five-year period. In 2023, this was equivalent to removing around £1 million-worth of trade barriers every single hour. British pork farmers are benefiting from newly agreed access to the Mexican market, which is worth £80 million over the same period. Our work on bottle labelling for UK gin and whisky has driven up exports to Chile by tonnes. We have ended the US ban on British beef and lamb.

We are working to deliver a strategy on a situation that faces the whole world, not just our friends and neighbours in Europe. This is crucial if we are to lock Britain into the future of where global growth will be. In 2022, the EU took more than 60% of UK goods exports. In 2023, this was 47%, because UK goods exports to the EU remained broadly flat, while exports to non-EU countries rose by around 70% in real terms.

We are going further to seize the benefits of an independent trade policy. We have deals with 73 countries around the world, with more to come under this Government, plus the most comprehensive trade deal to which the EU has ever agreed. Later this year, we will join the Comprehensive and Progressive Agreement for Trans-Pacific Partnership, one of the world’s biggest trading blocs. This will mean that more than 99% of UK goods will be eligible for zero tariffs in some of the Asia Pacific’s most dynamic economies. British business is set to benefit.

As well as service exports, where Britain excels, our top goods sales were in cars, mechanical-powered generators, medicines, pharmaceutical products and aircraft components. We have one of the world’s largest manufacturing sectors. Productivity in our manufacturing industry has grown faster than in every other G7 nation since 2010. Hundreds of businesses in steel, chemicals and other sectors stand to benefit from the newly introduced British industry supercharger, which is bringing energy costs down for key industries. Our £4.5 billion advanced manufacturing plan is opening new markets and removing obstacles to growth while helping to crowd in new funding for plants and factories throughout the UK. Every penny the UK Government spend on manufacturing is matched fivefold by the growth creators of the private sector. This pro-investment approach is working: the UK’s automotive sector attracted £3.7 billion-worth of greenfield foreign investment in 2022 alone.

The Labour party will remember Mr Alastair Campbell, who asserted during the referendum that if we leave the EU, Nissan will leave. Nissan is still here. The two new 100% electric models are set to be built at its Sunderland this year. More Minis are rolling off production lines in Oxfordshire today, thanks to a £600 million investment from BMW. These are firms that look for opportunities the world over and decide that the UK is the place to be. Listening to some of the remarks made in this House and elsewhere, people would think that our country was not worth investing in at all. Let us be clear: the British ingenuity and industry that made this country prosper in the past still exists today, and even if those on the Opposition Benches cannot see it, international investors certainly can.

The statistics published by my Department show that the UK’s inward FDI stock has reached more than £2 trillion. Our FDI stock is the highest in Europe—more than Germany, France and Italy combined. The most recent OECD data show that our employment rate is higher than that of the US, France and Italy.

The regulatory freedoms that we gained by leaving the EU have allowed our smarter regulation programme to cut the red tape that has been holding them back. We have already reformed the working time directive reporting requirements, saving businesses up to £1 billion per year. We recently announced that we will raise the thresholds that determine company size, reducing burdens on smaller businesses, and remove low-value and overlapping reporting requirements.

Those changes will make reporting simpler and deliver savings of around £150 million per year to UK companies, with small and medium-sized companies benefiting by around £145 million. It is no surprise that the most recent NatWest SME business activity index shows that output is increasing strongly, driven by renewed manufacturing sector expansion, and companies’ activity expectations remain upbeat. These things do not happen by accident, and I hope that hon. Members on both sides of the House will welcome those figures.

I have no doubt that this statement will disappoint some people, as it does not align with the story that they want to tell of a nation riven by injustice and economic stagnation, clinging to Europe for any hope for the future. That is not to say that everything is perfect—of course there is still more to do—but we are not alone in our problems. Ministers in other countries are quick to remind me about supply-chain issues affecting everything from getting car components to stocking supermarket shelves. They tell me about how they are coping with problems in the jobs market, as societies from Germany to Japan get older.

Only when I am back in the UK am I told that all these issues are down to Brexit. Far from it. Our plans are working, and Britain is thriving as an independent sovereign home of free enterprise and free trade. That is what the recent figures published by my Department, by the ONS, and by the UN tell me. It is what our businesses, exporters, employers and investors all tell me, and I hope that hon. Members present can see it too. I commend this statement to the House.

[Madam Deputy Speaker (Dame Rosie Winterton)]

I call the shadow Minister.

[Gareth Thomas (Harrow West) (Lab/Co-op)]

As usual, I am grateful to the Secretary of State for advance sight of her statement. I am always pleased to hear any positive news on trade and investment, but she appears, presumably inadvertently, to have missed out one or two facts and issues in her statement.

Under the Conservative party, business has suffered from endless U-turns and policy changes that undermine investment. There have been constant changes on policies, from net zero to corporate governance. The Government’s failure to address the big challenges facing business, such as skills shortages, infrastructure issues and net zero, have undermined business confidence. Foreign direct investment figures are down nearly 30% since 2016-17, according to the Government’s own figures. Without an industrial strategy, and with constant policy uncertainty, more businesses will not have the confidence to invest in the UK.

Specifically on trade, British exports in the past decade have grown slower than those of any other member of the G7 besides Japan. According to the Office for Budget Responsibility, since the Secretary of State was appointed, British exports have dropped and are expected to decline again this year, with at best anaemic growth in each of the next three years. Ministers have cut funding to help small businesses get to the international trade shows that they need to attend in order to find new export markets, and have cut funding to allow business groups to lead their own trade missions to win vital new orders for British business.

Farmers and Conservative members think that the Government’s record on trade negotiations is one of giving away far too much for far too little in return. Ministers delivered a poor trade deal with Europe that has put up barriers to trade, raised costs for businesses and helped to drive up prices, and there is no sign of any plan to use next year’s review of the trade and co-operation agreement to try to address at least some of those issues. Then there is the Conservatives’ failure to deliver on the promises in their manifesto at the last general election to have trade agreements in place with at least 80% of the world, and to have a trade deal with the United States. The target to deliver £1 trillion of exports has been moved many times, and will at best be delivered 15 years late.

Perhaps the right hon. Lady could answer the following questions. Last week, we heard about the impact that the Government’s constant flip-flopping is having on the automotive sector, with Stellantis airing serious warnings. What discussions has she had with the Transport Secretary to try to mitigate the impact of the Conservative party’s chaos? As the devastating news from south Wales continues to come, we have heard next to nothing from the Secretary of State on the damage that she has allowed to our steel industry. Does she still think that spending millions of pounds of taxpayers’ money to make thousands of people redundant and leave us as the first developed country with no primary steelmaking capacity was “a great deal”, as she said at the time?

Given that this House has repeatedly been promised an amazing trade deal with India, usually by Diwali, will the right hon. Lady update the House on the state of free trade agreement negotiations with India? Lastly, given the media reports at the weekend, which have caused concern, will she update the House on whether FTA negotiations with the Gulf Co-operation Council are still ongoing or have stalled?

[Kemi Badenoch]

I thank the hon. Gentleman for his questions. I could see that it was very difficult for him to find things to pick at in the statement, so I broadly welcome some of what he said, which implied that the good news is true.

The hon. Gentleman started with the OBR. He picked that statistic very selectively. Of course exports fell during covid; exports overall have grown. Many Opposition Members will say, “Oh, it’s just services.” That is because they do not understand the UK economy. The UK economy is 80% services, so it is good that services exports are going up. That is what we mainly do in this country.

The hon. Gentleman asked about Stellantis, and talked about U-turns. I remind him that the whole House voted for the net zero by 2050 target. It happened under a previous Conservative Government, but with the consent of the whole House. When business talks, we listen. The Opposition criticised us for making the changes that Stellantis asked for, so why is he now raising those comments? The Transport Secretary, the Prime Minister and I had a discussion—we do have discussions—and we extended the zero-emission vehicle mandate to ensure that we were not imposing undue costs on people if they were not ready to take up electric vehicles. We listen; the Opposition do not. Look at their plans for net zero. I assure the hon. Gentleman that businesses are absolutely terrified about what Labour would do with its new green deal, and all the measures that would just put costs on businesses and consumers.

The hon. Gentleman asked about steel. I am afraid that I need to correct several points. We saved jobs in Port Talbot—8,000 jobs were going to be lost, and we saved 5,000. If we want a net zero transition, we will have to move to electric arc furnaces, which require fewer staff. The Opposition cannot blame the Government for that while demanding a transition to net zero. We saved 5,000 jobs in Port Talbot. We invested £500 million out of a total £2 billion investment made with Tata. It is wrong to say that the Government are not saving steel; we are the only ones who have a plan for steel. The Opposition have no plan. We have a great plan, which will transform and regenerate south Wales.

The other thing that the hon. Gentleman said that was incorrect was about us having no primary steel production. We still have British Steel in Scunthorpe. There may be changes in Port Talbot around moving to electric arc furnaces, but he needs to remember that even the steel production that we have there relies on imports. We do not have iron ore here, so I recommend that he gets a briefing on exactly what is going on with steel production in the UK.

On India, the hon. Gentleman is right that a deal was promised by Diwali under a previous Prime Minister, but as soon as I became Trade Secretary, I said in this House over and over that it is about the deal, not the day. We do not sign trade deals that will not make businesses happy. We are keen to ensure that whatever we do will do right by our farmers. The Opposition laughed when I paused the FTA discussions with Canada. That was because what the Canadians were offering was not going to be good. The industry there is complaining that the UK got too good a deal from the CPTPP, but the Opposition do not talk about that. We are negotiating great deals for this country. I am very proud of the work that my Ministers and my Department are doing. I thank the hon. Gentleman for his questions.

[Sir John Redwood (Wokingham) (Con)]

I am grateful for the statement. It is wonderful news on exports; it shows that all the pessimism at the time of the referendum was completely wrong. I fully support the approach of the Secretary of State in delaying the target for battery vehicles, because people are not buying them in enough quantities, but will she add to that by adopting the advice of Stellantis not to fine motor manufacturers here for producing good petrol and diesel cars before people are ready to buy electric ones, because that is putting off investors?

[Kemi Badenoch]

I understand the point that my right hon. Friend makes. This is something that we have heard from some bodies in industry. The auto sector is giving us two different messages. Some people want us to bring the mandate forward and make the change faster; others want us to delay it. It is a very tricky balance. We understand the concerns. We do not want to put additional burdens on business, so he is right to make that point. I have made representations to the Transport Secretary, but this is his policy area, and he will make the ultimate decision.

[Madam Deputy Speaker (Dame Rosie Winterton)]

I call the SNP spokesperson.

[Alan Brown (Kilmarnock and Loudoun) (SNP)]

With these selective statistics, the Secretary of State would clearly make a good cherry-picker, while clutching at straws at the same time. The reality is that we still have a cost of living crisis, and I would welcome her to my constituency to tell people there how rosy things apparently are in the UK. Real GDP growth in the UK—growth since before the pandemic—is just 1%. That is one third of the EU average figure, and one eighth of US growth.

The here and now figures are even worse. The UK economy shrank in 2023, whereas there was significant growth in the G7 and the OECD average. Now is probably the only time in living history that the UK economy has been on a par with Germany’s—but sadly that is because Germany is also an international outlier in lacking economic growth. Volumes of UK goods imports and exports are 7.4% smaller than in 2018—the biggest five-year decline for which comparative records exist.

The Secretary of State is right that exports to the EU are up, but imports from the EU are also up, so the trading deficit with the EU has increased by more than 5%. Allianz Trade has estimated that the introduction yesterday of new customs and checks procedures on animal and plant products and goods entering the UK will cost British business £2 billion a year. UK Energy also estimates that energy bills are £1 billion a year higher due to post-Brexit trading arrangements.

Instead of talking up the minimal savings from what the Secretary of State calls “cutting red tape”, I wish she would tell the truth about the trading cost increases resulting from Brexit red tape for businesses in the UK, not to mention the impact of labour shortages. This Parliament is set to break a lot of records: we have the biggest drop in living standards, the longest decline in GDP per capita, the steepest five-year decline in volume of trade, and the stock market shrinking at its fastest pace in history. Which of these record-breaking achievements for broken Britain is she most proud of?

[Kemi Badenoch]

It was very interesting to hear the hon. Gentleman talk about his constituents. What he should tell them—certainly what I would, if I was there—is that under the seven-year Administration of First Minister Nicola Sturgeon, the SNP welfare economy grew at half the growth rate of England’s economy. If the SNP had achieved growth in line with England, it could have increased Scotland’s economy by £15 billion. Instead, that welfare economy means no growth, because of Scotland having the highest income tax rates in the UK, and higher wages in the public sector than in the private sector. The SNP’s policies are not helping.

The hon. Gentleman asks questions—[Interruption.] He does not want to hear the facts, but I will give him the facts. He talks about the real, pre-pandemic GDP figure. Of course the pandemic had an impact; we cannot stand here and pretend that it did not. Even the statistics I am quoting showed that covid had a far bigger impact than leaving the EU ever will, just as Russia’s war in Ukraine will have a far bigger impact than leaving the EU. He talks about international outliers, which shows that he is the one who is cherry-picking. We have to look at our peer countries, because we will not grow as quickly as developing countries. It is astonishing that he is also complaining that imports from the EU are up. That shows that, despite our leaving the European Union, trade is doing well and things are going well. If his Scottish Government took some lessons from the UK Government, they would see much better things happening for their constituents.

[Mark Logan (Bolton North East) (Con)]

I welcome the Secretary of State’s statement, and especially the fact that Japan was mentioned on, I think, five or six occasions. The latest statistics show there has been a £777 million increase in total trade between our two countries, which works out at an increase of 2.9%. I would also welcome her to an event that we are hosting with Baker McKenzie in the first week of June, launching Baker McKenzie’s UK Japan Connect, which seeks to foster business and trade between our countries.

[Kemi Badenoch]

I thank my hon. Friend for the question; I will check my diary to see if I am available for the event, but I am glad that he raises the issue of trade with Japan. We signed an upgraded FTA with Japan after leaving the EU, so these roll-over deals are no longer roll-over deals, because we are adding more into them, especially the digital trade chapters. These are deals fit for the 21st century—the age we live in—rather than the 20th century.

[Madam Deputy Speaker (Dame Rosie Winterton)]

I call the Chair of the Business and Trade Committee.

[Liam Byrne (Birmingham, Hodge Hill) (Lab)]

It is good to see the Secretary of State in the House again. I know she has a difference of opinion sometimes with the Office for Budget Responsibility, but can she confirm that the OBR’s figures for March 2024 show that the UK has the lowest trade intensity in the G7? There was important progress, as she has reported today, but much of it rests on progress in our services trade, which provokes the question of why we are not pursuing services-only trade agreements in a more expansive way, not least as the Minister for Trade Policy was unable to confirm whether any comprehensive free trade deals would be signed before the election when he came before the Committee yesterday. He said that services-only deals were not allowed under World Trade Organisation rules, which of course is flat-out wrong.

The question I want to put to the Secretary of State is about our goods trade. The Office for National Statistics figures show that our goods exports have fallen by about £31 billion over a year. The risk is that that number will be hit even harder by the chaos at the border. The new border operating model involves data that is submitted by traders, but then not shared with ports; sometimes two hours’ notice is needed for a journey that only takes 90 minutes; there is no standardisation of inspection charges; and British Chambers of Commerce says that many businesses will be hit by thousands of pounds-worth of customs bills that they did not know they were on the hook for.

The question is this: did the Secretary of State warn her colleagues in Cabinet that there would be complete chaos, and that the EU checks that we are introducing would be a disaster? That is what small business is saying to me, and I know it is what small business is saying to her.

[Kemi Badenoch]

I thank the right hon. Gentleman for his questions. He asks why we are not pursuing services-only deals. We have done two of those: one with Singapore and one with Ukraine about digital trade exclusively. However, it is an area where we need both sides to agree, and most countries still want a goods deal; for many of the countries that we are negotiating with, goods are still the larger part of their economy. We have to bear that in mind, because trade deals are not a one-way story.

I am glad that the right hon. Gentleman welcomes my statement. He will of course know that I am not somebody who pretends that everything is perfect and nothing could be better. I do think things could be improved, but one thing we have to acknowledge, in reference to his comments about the border operating model, is that the people voted to leave the European Union. There will be opportunities and there will be costs. Farmers regularly tell us that they want better food standard checks and other checks at the border. That will impose a cost. We have done everything we can to minimise those costs—we have even found cost savings in doing so. I have heard many scare stories about what businesses will see at the border, but not all of them will apply. We are doing everything we can to minimise the burden, but the fact is that the EU imposed the same measures on the other side, and we need to give our producers a level playing field.

[Julie Marson (Hertford and Stortford) (Con)]

It is a pleasure to follow the Chairman of the Business and Trade Committee. I am a relatively new member of the Committee; I joined this year. I recall my first meeting, at which we heard that the UK has had the third-highest foreign direct investment over the past years; we are behind only the US and China. This week, at our meeting with the Minister for Trade Policy, we heard about our trade deals with over 70 countries, including the landmark CPTPP. Does my right hon. Friend the Secretary of State agree that that track record of success contrasts starkly with Labour’s track record? Under Labour, the UK’s share of global trade declined. Does she agree that, just perhaps, aside from the Chairman of the Select Committee, there is not a single Labour Back Bencher in the Chamber who wants to hear about that track record of success, because they do not have a leg to stand on?

[Kemi Badenoch]

I thank my hon. Friend for the question. She is right, and I am sure that the hon. Member for Harrow West (Gareth Thomas), who was a Labour Trade Minister, could verify those figures about our trade dropping.

[Gareth Thomas]

indicated dissent.

--- Later in debate ---

[Kemi Badenoch]

He is shaking his head. In answer to my hon. Friend’s question, we were often told that we would never be able to get those 73 trade deals—we were mocked—and that nobody would sign any deals with the UK that were like what we had in the EU. We got 73 done, and many of them we have actually improved on. We in this House must remind people that we have done much good; they may forget. People live in the moment, and we have to remind them of our record—and this is a record we should be proud of.

[Paul Girvan (South Antrim) (DUP)]

As much as we welcome the good figures that have been produced, Northern Ireland still suffers from not having full access to the trade deals that the United Kingdom has struck throughout the world with 70 countries. What measures would ensure that we can take advantage of those deals and get rid of the injustice of the protocol and the difficulties that it causes businesses in Northern Ireland?

[Kemi Badenoch]

We have been doing a lot in Northern Ireland to increase investment and make up for any shortfall, whether through our trade deals or otherwise. The Windsor framework, for example, is one thing that the Prime Minister has worked on to iron out some of those issues. We are looking at where Northern Ireland can exploit the benefits of being part of both the EU single market and the UK single market, which is a unique position. We know that there are some areas in which things are not exactly the same as in GB, but we can look individually in specific trade deals at what we can do. In services, for example, that should not be an issue; we really see the difference in goods. We can do a lot more and we continue to work on that.

[Sir Julian Lewis (New Forest East) (Con)]

Does the Secretary of State agree that, if we cast our minds back to the time of covid, when we were spending hundreds of billions of pounds just to keep the country functioning, none of us could have imagined sets of statistics as positive as those that she has given us? May I re-emphasise a point that has already been made in slightly different terms? There appear to be eight times as many people sitting on the Conservative Front Bench as there are on the entirety of the Labour Back Benches. Does she take that as a vote of confidence in the Government’s positive message?

[Kemi Badenoch]

My right hon. Friend is absolutely right. It is clear that Labour does not like good news. As soon as there is any, Labour Members exit the Chamber unless they absolutely have to be here. It is disgraceful that there is not a single Back-Bench Labour Member, other than the Chair of the Business and Trade Committee, the right hon. Member for Birmingham, Hodge Hill (Liam Byrne). The shadow Minister, the hon. Member for Bethnal Green and Bow (Rushanara Ali), is blushing because she knows that it is true. That is one reason why it is important for us not to assume that people see these statistics. If we do not talk about them, nobody else will. Enough people out there—certainly on the Labour Benches—will tell us how terrible everything is, but we need to remind people about the good that is happening.

[Wera Hobhouse (Bath) (LD)]

In complete contrast to the rosy picture that the Government are trying to paint, there are some inconvenient truths that have been left out. From this week, new checks on food imports from the EU will see costs for importers rise by 60%, which will have a severe impact on small businesses and consumers alike. Will the Secretary of State take this opportunity to lay out how consumers and small businesses will be protected from those severe new costs?

[Kemi Badenoch]

I seem to remember a time when some Liberal Democrats were complaining that we did not have any checks at the border, and that that showed that standards in this country were low. If we do something, they immediately make the opposite argument—there is no consistency whatsoever. I explained in response to an earlier question why we are doing this and how it is of benefit. It is about maintaining standards. The other thing that the hon. Lady should realise is that we have been able to reduce tariffs on loads of products—thousands of products—from across the world, which also helps to reduce prices and tackle inflation.

[Theo Clarke (Stafford) (Con)]

I welcome this statement on the Government’s progress on business and trade. It is fantastic news to hear that the UK has been the fourth biggest exporter in the world. As the Prime Minister’s trade envoy to Kenya, I have been meeting British businesses regularly to better understand how the Government can help them to export to that key market. During my most recent visit to Nairobi, I have been focused on delivering the UK’s flagship projects, including Nairobi Railway City and the High Grand Falls dam. Will my right hon. Friend continue to remove barriers for British businesses to ensure that they can grow their exports to key markets such as Kenya?

[Kemi Badenoch]

First, I thank my hon. Friend for all her work as the Prime Minister’s trade envoy to Kenya. She will know that officials have been engaging with their Kenyan counterparts to progress work on market access barriers, including working closely with UK industry and Kenya’s Anti-Counterfeit Authority to address the issues facing British exporters. We are doing a lot of work to deepen collaboration between the UK and Kenya, which wants our expertise, especially in important sectors such as healthcare and financial services. I hope that I will be able to work further with my hon. Friend to deliver more trade between the two countries.

[Jim Shannon (Strangford) (DUP)]

I thank the Secretary of State very much for her positivity, which is encouraging for the House, for the country and for this United Kingdom of Great Britain and Northern Ireland, and I ask this question constructively. Figures have shown that from 2021 to 2023 there was a slight decrease in the number of new jobs created in the United Kingdom. What discussions has she had with the Department for the Economy, and the NI Assembly, about Northern Ireland’s contribution to creating new employment in 2024-25, so that the figures can remain on the increase, as they did in the years prior to 2021?

[Kemi Badenoch]

I think the point that the hon. Gentleman is making is that we cannot be complacent about what is happening in either country. Even as we talk about good news, we need to continue working to ensure that those things do not disappear. He is right that we should do as much as we can with the Department for the Economy. Now that a Minister is in place, it will be a lot easier for us to co-ordinate and see how we can work together to increase employment and improve wages and productivity in both regions.

[Martin Vickers (Cleethorpes) (Con)]

I welcome the Secretary of State’s statement. It was particularly encouraging to hear the news about the manufacturing sector. However, as she will be aware, if growth in that sector is to be maintained, continued Government support will be needed. Will it be forthcoming?

[Kemi Badenoch]

We have put in place a £4.5 billion advanced manufacturing plan for the manufacturing sector. Firms will need to ensure that they qualify for that funding. We are also doing what we can to bring in investment—especially foreign investment—which will help to drive productivity. It is good to see that business and investors globally want to invest all across the UK, not just in London, and not just in financial services but in manufacturing, certainly, and in our green industries of offshore and renewables. There is so much that we can do that will create industries and companies fit for the future.

[Rob Butler (Aylesbury) (Con)]

I congratulate my right hon. Friend on ensuring that these superb trade figures are brought to the attention of Parliament. Trade between the UK and Morocco has grown consistently since the entry into force of the UK-Morocco association agreement just last month. A UK consortium won the tender to design the Casablanca stadium for the 2030 World cup, which will be the second largest stadium in the world by seating capacity. Does she agree that it is thanks to Brexit that we can forge such one-to-one trade agreements that are of real benefit to British businesses, and does she share my view, as the Prime Minister’s trade envoy to Morocco, that we should continue to prioritise work with Morocco, which is a dynamic and growing trade partner?

[Kemi Badenoch]

My hon. Friend is absolutely right. We should continue to prioritise trade with Morocco and countries like it. I remember that when we had a tomato shortage in western Europe, Morocco was one of the countries that had cheaper supplies, and we can drop tariffs on such products when shortages are affecting all of western Europe, not just the UK. So much flexibility comes of being able to have our own independent trade policy. I pay tribute to him for his work as trade envoy to Morocco, as I should have done to my hon. Friend the Member for Cleethorpes (Martin Vickers) for his work as trade envoy to the western Balkans. There are so many trade envoys in the Chamber today, and I am grateful for all their work to support our Department and deliver the good news stories that we are talking about today.

[Lia Nici (Great Grimsby) (Con)]

I welcome my right hon. Friend’s statement, particularly with regards to growth in manufacturing and exporting. Great Grimsby has a huge amount of opportunity in carbon capture and storage, as well as in our UK seafood processing industry, which is the biggest such cluster in the country. Does she attribute some of the developing growth to UK freeports, one of which is in Grimsby? I look forward to welcoming her very soon.

--- Later in debate ---

[Kemi Badenoch]

Yes, freeports are another policy that has come about from our ability to leave the European Union. We are doing everything we can to bring in that investment. Carbon capture and storage is one area in which we think the UK can lead. We have the expertise and a lot of the talent and skills. Many of the people who want to understand that technology are coming to the UK. I hope that we can do more for my hon. Friend and her constituents in Great Grimsby, and I will look into what we can do to ensure that I or another Minister comes to see the good work taking place there.

[Dr James Davies (Vale of Clwyd) (Con)]

I hugely welcome the upbeat nature of this statement and the Secretary of State’s reference to Britain joining CPTPP. Snowdonia Cheese, which is based in my constituency, also looks forward to the UK’s accession to CPTPP and the generous, tariff-free access to the Canadian and Mexican markets that it will bring. It is understood that that access may be available as soon as later this year, so would my right hon. Friend kindly ask one of her officials to get in touch with that company to keep it updated on progress?

[Kemi Badenoch]

I am very happy to do so. My hon. Friend is right that our accession to CPTPP is carrying on: as he knows, we have ratified the Bill in Parliament, and three of the CPTPP countries have completed their own processes—there are only a handful to go—so I do think this is something that will be possible. I will arrange for officials to meet representatives of the business in my hon. Friend’s constituency to have that conversation.

[Richard Fuller (North East Bedfordshire) (Con)]

We are in the Chamber to talk about the progress of British business, so it is telling that Labour MPs have not bothered to show up. If today’s Financial Times is to be believed, that is because they are desperately trying to find businesses to talk about the latest reversal of Labour party policy, which is on Labour’s very damaging approach to the labour market. Its approach would place additional laws on business that would stifle enterprise and hand out more bungs to its paymasters in the trade unions, so does my right hon. Friend agree that the right way to back British business is to get the right regulation, not the stifling legislation that the Labour party would put in place?

[Kemi Badenoch]

I absolutely agree with my hon. Friend. We are doing so much to get our regulatory environment right, and I thank my hon. Friend for all the work he has done in this area. I know it is something that he cares about, and I thank him for many of the suggestions and much of the advice that he has provided to me.

The right regulatory environment can and will deliver growth. I am terrified by some of the things that I see the Labour party putting forward, and businesses do not like them either. Those flexible rights from day one would mean that if a business employs someone and they do not turn up to work on their first day, that business could not sack them, which would be a disaster. We have done so much on labour rights, but it is not the area that is going to deliver growth, certainly not with the policies that Labour is putting forward.

[Jonathan Gullis (Stoke-on-Trent North) (Con)]

I warmly welcome the Secretary of State’s statement, particularly when it comes to manufacturing and exports. I thank her personally for the time she took yesterday to meet Johnson Tiles, Churchill China and Steelite—great manufacturers of ceramics in Stoke-on-Trent North, Kidsgrove and Talke—as well as Rob Flello, the chief executive officer of Ceramics UK. Despite what has been a very challenging time for the industry, particularly due to the rise in energy prices sparked by Vladimir Putin’s illegal and immoral war in Ukraine, can the Secretary of State assure me that the ceramics industry will be able to take part fully and play a big role in ensuring that we export the very best of Britain around the world, particularly through future free trade agreements with countries such as India?

[Kemi Badenoch]

Yes, that is right. With our FTAs, we are trying to ensure that we deliver for businesses; if businesses are not happy, those FTAs will not work. The FTAs are going to be used by businesses, not by politicians—it is not about the photos that are taken.

I thank my hon. Friend for the meeting he organised yesterday with representatives of the ceramics industry and ceramics producers in his constituency. We understand the difficulties that they face, with energy costs having risen following the war in Ukraine, and we are doing everything we can; I talked about the supercharger, which should help to deliver for those who are electricity users. We understand the changes and burdens that net zero is placing on those businesses, and are doing everything we can to mitigate them as we try to deliver that target.

[Miriam Cates (Penistone and Stocksbridge) (Con)]

Like all of my colleagues, I warmly welcome my right hon. Friend’s statement, and very much welcome her focus on the balance of trade. We do not talk enough about that; we forget that until 1997, this country had a broadly neutral or positive balance of trade, but between 1997 and 2010, that balance went very negative. We have struggled to restore that balance, which has made us dependent on foreign debt and our economy fragile, so I very much welcome these figures—it looks like we are turning the tide.

I also welcome my right hon. Friend’s focus on manufacturing, which has a very important part to play in our balance of trade, but we must not forget about the small manufacturers. She has rightly focused on the larger ones, but nearly 6,000 jobs in my constituency are dependent on export. What help is available from the Government to help smaller manufacturers, which often face more barriers to exporting, to also be part of this excellent recovery?

[Kemi Badenoch]

My hon. Friend makes a very good point. Through our export strategy, we are doing a lot to provide support for businesses that may not be familiar with exporting or that need additional help. We do that work with our trade commissioners in every region around the world, as well as with international posts.

One thing we have said in the Department for Business and Trade is that this is the year of the small and medium-sized enterprise. Quite a lot of the time, the news that we give is about the big billions for the FTSE 100 companies, but most people who work in this country work for small and medium-sized businesses. That is one reason why we want to reduce the threshold at which they count for the purposes of corporate reporting and regulations, which should make their lives easier and give them fewer barriers to trade. It will help them to improve their exports, as well.

Bill Presented

Russian State Assets and Reconstruction of Ukraine Bill

Presentation and First Reading (Standing Order No. 57)

Rehman Chishti, supported by David Morris, Afzal Khan, Dr Matthew Offord and Henry Smith, presented a Bill to make provision about the seizure, freezing and transfer of Russian state assets; to require the Secretary of State to publish proposals for the use of such assets for the reconstruction and rebuilding of Ukraine, including an assessment of the needs of Ukraine; and for connected purposes.

Bill read the First time; to be read a Second time Friday 17 May, and to be printed (Bill 211).

Post Office (Horizon System) Offences Bill

Kemi Badenoch Excerpts

Committee of the whole House
Monday 29th April 2024 Commons Chamber

[The Secretary of State for Business and Trade (Kemi Badenoch)]

I beg to move, That the Bill be now read the Third time.

Hon. Members will need no reminder of the significance of this Bill. This legislation will, I hope, bring some much-needed relief and closure to those caught up in one of the greatest miscarriages of justice in our nation’s history. For the postmasters wrongfully accused of, and convicted and punished for, crimes they never committed, this Bill means hard-won exoneration, with their convictions wiped clean from the slate.

A wrong is finally being put right but, as hon. Members know, these postmasters will also receive the fair compensation they deserve through the Horizon conviction redress scheme; this will be delivered by my Department rather than the Post Office. While the scale of the Government’s response in this case is extraordinary, I am keen to remind hon. Members that it does not set a precedent for our involvement in other judicial matters. I know this sentiment has been echoed across this House during debates on the Bill. We have chosen this path because the sheer extent of the Post Office’s prosecutorial misconduct is an affront to justice in and of itself. It demanded an exceptional response from Government.

That is why I was glad to see this Bill being welcomed on both sides of the House on Second Reading. There is, I believe, a unanimous consensus that the provisions of this legislation are needed to bring justice to postmasters who have suffered too much for far too long.

[Bob Seely (Isle of Wight) (Con)]

I am sorry to intervene on Third Reading. The Secretary of State is talking about justice for postmasters and mistresses, which is completely right, but I want to ask one question about the policy aspect of this. I and other Members have had postmasters who have written to us who have not been prosecuted but found that the Horizon system was working badly and had to top up out of their own money when Horizon was reporting losses due to faults in the system. What is their redress route if they are now saying, “I was hundreds of pounds out of pocket because I was having to make up the difference”?

[Kemi Badenoch]

We have devised the Horizon shortfall scheme to deal with those specific situations and if my hon. Friend writes to the Department we can look at some of the cases brought to him as a constituency MP.

I know the debate to date has centred around calls to extend the Bill to Northern Ireland, and the Government have been supportive of them. So, in consultation with the Northern Ireland Executive, I was pleased to see the Government amendments in my name accepted by the Committee of the whole House. As a result of the House’s support, postmasters in Northern Ireland who suffered the same injustices as those in the rest of the UK will now also see their good names restored, with proper financial redress.

As has been noted during recent debates, the speed of that redress could not be more important. Because of the Horizon scandal, people lost more than just their jobs; they were pursued for non-existent losses, they racked up legal bills, and they suffered enormous financial and personal strain because of the Post Office’s actions. It is therefore entirely right that victims do not wait a second longer than necessary to have that money paid back to them—with interest—to reflect what they have lost. I am determined that this legislation complements the ongoing work to hasten redress across the existing schemes. Here we are already making good progress, with payments allowing postmasters to finally move on with their lives.

I would like to take this opportunity to thank the Opposition, especially the hon. Member for Stalybridge and Hyde (Jonathan Reynolds) for his constructive and supportive approach to working with the Government on this Bill, and so many Members across the House who have engaged with us over and again to deliver the right result for postmasters. I would also like to thank the officials of both my Department, Business and Trade, and the Ministry of Justice who have been working hard behind the scenes for some time to ensure that postmasters affected by the Horizon scandal are supported and compensated fairly. But most of all I thank my hon. Friend the Member for Thirsk and Malton (Kevin Hollinrake) for his exemplary work as Post Office Minister and in taking through this Bill and dealing with the issue in a very sensitive manner and helping to create confidence in the scheme.

This Bill is a major step forward in that mission. After years of campaigning and fighting to clear their names, postmasters are now receiving the justice they deserve. No Bill can fully undo the damage that has been done or remove the scars the Horizon scandal has left on its victims, but through this legislation we are doing our best to right the wrongs of the past so that every postmaster caught up in this scandal can begin to rebuild their lives. I commend the Bill to the House.

Post Office (Horizon System) Offences Bill

Kemi Badenoch Excerpts

2nd reading
Wednesday 20th March 2024 Commons Chamber

[The Secretary of State for Business and Trade (Kemi Badenoch)]

I beg to move, That the Bill be now read a Second time.

I am pleased to present the Bill for its Second Reading. It will quash the convictions of those affected by the Post Office Horizon scandal in England and Wales—one of the greatest miscarriages of justice in our nation’s history. The legislation will clear the names of sub-postmasters whose lives were ruined because of the Horizon scandal: those wrongly convicted of or cautioned for offences of false accounting, theft and fraud, all because of a faulty IT system that the Post Office had implemented.

Instead of listening to whistleblowers such as Alan Bates when they raised concerns, the Post Office viciously pursued them for the shortfalls. Some were suspended or dismissed; hundreds were prosecuted, convicted and imprisoned; others were harried as thieves by their local communities. Several were driven to suicide. The Government cannot turn back the clock or undo the damage that has been done, but we will seek to right the wrongs of the past as best we can by restoring people’s good names and ensuring that those who have been subject to this tragic miscarriage of justice receive fair and full redress. The Bill represents a crucial step in delivering that.

[Ian Paisley (North Antrim) (DUP)]

The whole House appreciates the efforts that the Government are making to rectify this problem at last, but I appeal to them to listen to the cross-party representations made from both sides in this House and all sides in Northern Ireland, including by the First Minister, the Deputy First Minister and the Justice Minister for Northern Ireland, who have appealed for the fewer than 30 people in Northern Ireland who have been affected by the scandal to be included in the Bill.

[Kemi Badenoch]

We are working closely with the Northern Ireland Executive. We have carefully considered the territorial extent of each piece of legislation, and we are rigorous in our commitment to devolution. The hon. Gentleman should be assured of the amount of work that is taking place to ensure that we get the Bill done properly in a way that will not have unintended consequences. I thank him for that point.

This new legislation will quash all convictions that meet the clear and objective conditions laid out in it. We recognise that postmasters have suffered too much for far too long, which is why convictions will be quashed automatically when the Bill receives Royal Assent, removing the need for people to apply to have their conviction overturned.

[Sir Jeremy Wright (Kenilworth and Southam) (Con)]

I am extremely grateful to my right hon. Friend for giving way. I understand entirely why the Bill is necessary. She will agree that it is important that we do not, through the Bill, set any precedent for the interference of this House in individual convictions, unless there are exceptional circumstances such as these. That means that the Bill must be tightly drafted. At the moment, condition E—the last of the conditions that she has mentioned—is that

“at the time of the alleged offence, the Horizon system was being used for the purposes of the post office business.”

Why is that not phrased differently to say that Horizon-based evidence was presented in the case against the person convicted? There is a material difference between those two things. I just seek to understand why she has chosen that formulation rather than the alternative.

[Kemi Badenoch]

My right hon. and learned Friend makes a good point about the final condition in the Bill. That is something that we considered, but it would likely have required a case-by-case, file-by-file assessment of each prosecution. That would have added significant time and complexity, which is what our solution avoids. One thing that I have been keen to emphasise is that speed and pace are critical. This has taken far longer than I would have wanted, and I would not have gone for a solution that would have impeded this and created complications.

[Liam Byrne (Birmingham, Hodge Hill) (Lab)]

I put on the record my thanks to and commendations for the Under-Secretary of State for Business and Trade, the hon. Member for Thirsk and Malton (Kevin Hollinrake), for the way in which he has approached the groundwork for the Bill.

Among those excluded from the scope of the Bill are those who went to the Court of Appeal and lost their case, or were not given leave to appeal to the Court. What we now know would have been quite useful in many of those cases. Should we enlarge the scope of the Bill to include those who lost their case at the Court of Appeal or were not given leave to appeal in the first place, as many of them may well be truly innocent?

[Kemi Badenoch]

I thank the right hon. Gentleman for that point. That is also something that we considered carefully. It is part of the trade-off that we had to make in doing something unprecedented: Parliament overturning convictions. We respect the judgment of the Court of Appeal—it has gone to an appellate judge. We are willing to consider some of those cases individually just to ensure that nothing has been missed, but the Bill has been drafted in consultation with the Crown Prosecution Service and the judiciary. We want to ensure that we are bringing everyone with us. Concerns such as his have been raised, but this is more or less the consensus that we think will get the Bill done, and allow redress, as quickly as possible.

[Sir David Davis (Haltemprice and Howden) (Con)]

I will elaborate on this point further when I speak—hopefully, if I catch Mr Deputy Speaker’s eye—but there is already data about the cases that the right hon. Member for Birmingham, Hodge Hill (Liam Byrne) referred to, those that are outside the Horizon case itself but were attempting to get themselves exonerated on the basis of other data. As far as I can see, they failed precisely because they were not part of the Horizon case, so I ask the Secretary of State to return to this issue before Report and look at whether we can solve that problem.

[Kemi Badenoch]

I thank my right hon. Friend for that intervention. That is something we can look at again at further stages of the Bill. We understand the issue that hon. Members are trying to resolve, and agree with them that we need to make sure that everybody who deserves justice gets justice, but we also have to be careful to make sure that we are not exonerating people who we know for a fact have committed crimes.

[Mary Robinson (Cheadle) (Con)]

I am grateful to my right hon. Friend for giving way, and I commend her work and that of my hon. Friend the Member for Thirsk and Malton (Kevin Hollinrake), not only in recognising the plight of these people and putting in place compensation for their suffering, but in ensuring that these criminal convictions are expunged from their record. It is really important for these people that they regain their standing within their communities.

As my right hon. Friend has rightly said, so many of these whistleblowers were failed by the current law: the Public Interest Disclosure Act 1998. It is really vital that we not only put that right, but have a good look at the law again. I know that a framework review is going on, and have spoken to my right hon. Friend and my hon. Friend about what more can be done. I have tabled a whistleblowing Bill that will sort this problem out. It lands within the Department for Business and Trade—it is something that is within my right hon. Friend’s gift. Will she support my private Member’s Bill on Friday?

[Kemi Badenoch]

I thank my hon. Friend for all the work she does in chairing the all-party parliamentary group for whistleblowing. She is right that this issue needs consideration, and we are going to look again at the whistleblowing framework—it is something that comes up time and time again in many respects. I will not comment yet on her private Member’s Bill, because I have not seen it, but I thank her for all her work on this issue.

[Mr Kevan Jones (North Durham) (Lab)]

I welcome this Bill. I know that it is groundbreaking and possibly sets some nerves off with the judiciary, but I think the judiciary need to look at themselves and how they have dealt with some of these cases.

On the point that my right hon. Friend the Member for Birmingham, Hodge Hill (Liam Byrne) raised, a small number of cases are not within the scope of the Bill. I perfectly understand why, but we have to get those cases looked at again, because evidence has come out in the Sir Wyn Williams inquiry that was not available at the time. Will the Secretary of State commit to at least sit down with the judiciary to look at these cases and emphasise the fact that there is new information, and that responsibility for some of this injustice has got to lie with the justice system?

[Kemi Badenoch]

I thank the right hon. Gentleman for his intervention. The courts dealt very swiftly with the cases before them—perhaps a bit too swiftly. That is why the sub-postmasters suffered so many miscarriages of justice, and it is right that we make their exoneration as simple and quick as possible, so while my priority is passing this Bill for the bulk of the people who have suffered, that does not mean we will not be able to look at other scenarios later and see if we can find solutions where we genuinely believe that there has been a miscarriage of justice. That is not for me to do at the Dispatch Box—it will not be up to Ministers. There will be caseworkers who will carry out that work, but we have to be careful to make sure that we are exonerating the right cohort.

[Mr Jones]

I hear what the Secretary of State says, but I would just say to her that this is a small number of people and they have to be looked at. Can I ask that she shows the same zeal that her hon. Friend the Member for Thirsk and Malton (Kevin Hollinrake) has shown in his approach to this process? We need a commitment, not to get these cases sorted today—I accept that the Secretary of State cannot do that—but that the Department will look at them. I think that will send quite a strong message out to people.

[Kemi Badenoch]

The Department can always do that. This is something that we believe is so critical in order to make sure everybody gets the justice they deserve, and we need to make sure that we carry out the process in such a way that everyone has confidence in it. We can continue to look at cases and see if there are other solutions, but as the right hon. Gentleman has rightly said, that will be outside the scope of this Bill.

[Sir Robert Neill (Bromley and Chislehurst) (Con)]

I am very grateful to the Secretary of State for giving way, and I also pay tribute to the exceptional work of my hon. Friend the Member for Thirsk and Malton (Kevin Hollinrake) and the way in which he has engaged in what is a sensitive issue, not least constitutionally. Does my right hon. Friend accept that it is not ideal under any circumstance for this House to trespass upon the legitimate preserves of the independent courts? It should only do so under the most exceptional circumstances. There is a case that this is one of those instances, but while we can legitimately criticise failings in the criminal justice system—such as in disclosure, which is part of the system—it is important that we do not get into the territory of impugning the individual decisions of judges made in good faith on the evidence properly before them.

One thing we could do to emphasise the exceptional nature of the Bill would be to introduce a sunset clause, so that at an appropriate time when the Bill has served its purpose—perhaps some way in the future, once those who need to be found and contacted have been able to come forward and have their convictions quashed— it would no longer be the constitutional anomaly that it might otherwise be if it stayed on the statute book indefinitely.

[Kemi Badenoch]

I am very happy to consider a sunset clause. My hon. and learned Friend makes a very good point, and I really appreciate the fact that he can see the tightrope that we are walking: getting justice for postmasters while not interfering with judicial independence.

[Sir Robert Buckland (South Swindon) (Con)]

I think it is important that we emphasise the wholly exceptional nature of this legislation, but we are dealing with wholly exceptional circumstances—we hope. The point about disclosure is one that I cannot make strongly enough, and we have to look again at our presumptions about machines and what they produce when it comes to criminal litigation.

Can I press my right hon. Friend to reiterate the wholly exceptional nature of this legislation? I think we need to be careful when it comes to a sunset clause, because we do not want to end up frustrating the purpose of the Bill, which is to deal with the hundreds of people who have lost faith in the system and might be difficult to track down and identify. I am not particularly in favour of a sunset clause, but we do need to emphasise the exceptional nature of this legislation.

[Kemi Badenoch]

I am grateful to my right hon. and learned Friend for his intervention. I am very happy to emphasise that, and will do so again later in my speech. I do enjoy it when we have two lawyers who disagree on a particular point; I will be taking this as their application to join the Bill Committee.

The Bill includes a duty on the Government to take all reasonable steps to identify convictions that have been quashed. It also creates a duty to notify the original convicting court, so that records can be updated and people’s good names can be restored. Other records, such as police records, will be amended in response. The Bill makes provision for records of cautions for relevant offences relating to this scandal to be deleted. While the financial redress scheme will be open to applicants throughout the UK, the Bill’s measures to overturn convictions will apply to England and Wales only.

[Mark Pawsey (Rugby) (Con)]

We on the Business and Trade Select Committee heard absolutely harrowing accounts from postmasters of what they had gone through as a consequence of the Post Office’s actions, but many of those cases took place many years ago. Can the Secretary of State be confident that the audit process in an organisation such as the Post Office will in future identify what has happened at an earlier stage, and does she agree that legislation such as this should never come before this House again—that this should not happen?

[Kemi Badenoch]

I believe that the inquiry being led by Sir Wyn Williams is currently looking at that issue. It is important that audit processes work at the highest level, and that people are able to rely on and have confidence in them, so I thank my hon. Friend for raising that point.

On the question of territorial coverage, as I said earlier to the hon. Member for North Antrim (Ian Paisley), my Department will continue working closely with the Northern Ireland Executive and the Scottish Government to support their approaches to addressing this scandal, ensuring that every postmaster who has been affected receives the justice they deserve, irrespective of where in the United Kingdom they are. Indeed, my colleague and hon. Friend the Member for Thirsk and Malton (Kevin Hollinrake), the Minister for postal affairs, has already met Justice Ministers in the Scottish Government and the Northern Ireland Executive to offer our support.

[Stephen Farry (North Down) (Alliance)]

I accept that the Department is very keen to respect the devolved settlements in both Northern Ireland and Scotland, but can I stress to the Secretary of State that there is political consensus in Northern Ireland, and Ministers in the newly restored Executive would welcome Parliament acting in this particular area?

Due to the nature of devolution in Northern Ireland, we have to have a public consultation, so in the best-case scenario we are looking at well towards the end of this year before we can replicate legislation here in Westminster. As this was a national scandal, it does require a national solution to avoid a situation of inequity in which some postmasters in parts of the UK are exonerated while others are still waiting.

[Kemi Badenoch]

I take the point the hon. Member makes very seriously. We do understand, but we want to make sure that we do not create any possible unintended consequences by legislating on devolved issues, so we are working hand in glove with the Northern Ireland Executive to make sure this goes through as quickly as possible. We know that the numbers there are much smaller, and that the postmasters there have been identified. He is right to raise the point, but I want to reassure him that we have every confidence that we will be able to get this done at the same pace.

[Liam Byrne]

Could I put that question in a slightly different way? The Minister for postal affairs has set out an ambitious timetable for the passage of this law, the overturning of convictions and the dispensation of compensation, with it all possibly being done and dusted—with hope, and a following wind—by the end of July. Could the Secretary of State commit to a similar timetable when it comes to the cases that have been raised in Northern Ireland?

[Kemi Badenoch]

That is certainly something we can encourage the Executive to work to, but I cannot personally make that commitment because it would not solely be up to me. However, I just want to reassure the House that this is something we care about. We are not prioritising England and Wales because it is England and Wales; we are doing what we can as quickly as we possibly can to make sure that we do not create problems later by rushing and not doing things properly. I think that that is a good and ambitious target, but it would not be up to me to make such a commitment.

I am aware that the approach we are taking in this Bill is a novel one. With it, Parliament is taking a function usually reserved for the independent judiciary, as my right hon. and learned Friends the Members for Kenilworth and Southam (Sir Jeremy Wright) and for South Swindon (Sir Robert Buckland) and my hon. and learned Friend the Member for Bromley and Chislehurst (Sir Robert Neill) have said. However, I am equally aware that the postmasters’ long and punishing fight for justice must now be swiftly drawn to a close. The circumstances surrounding the scandal are wholly exceptional, and they demand an exceptional response from Government, so I would like to take this opportunity to reassure the House that the introduction of the Bill is in no way a reflection on the courts and the judiciary, which have dealt swiftly with the cases before them.

[Katherine Fletcher (South Ribble) (Con)]

I would like to commend both the Secretary of State and her team for bringing forward this Bill. The sub-postmasters have faced a miscarriage of justice that has taken many people’s breath away. I am aware that this is specific and focused legislation, but two South Ribble constituents came to see me who had been Royal Mail customers, and they described scenarios of prosecutorial practice very similar to what sub-postmasters were subject to. Would the Secretary of State consider expanding the scope of the legislation in future to other people who may have been subject to poor treatment?

[Kemi Badenoch]

I thank my hon. Friend for her intervention. I can look specifically at the cases she raises, but I think they may actually be covered by this Bill. I would be wary of expanding the scope too broadly. The consensus we have with the CPS, the judiciary and so on has been achieved by the legislation being very tightly scoped, but we do want to make sure that people who have been at the end of an injustice can have those wrongs righted. I am very happy to look at the specific cases of her constituents.

[Andy Carter (Warrington South) (Con)]

I am very clear that this Bill is about correcting convictions that were made in error. However, there are of course a number of employees—direct employees—of the Post Office who were never convicted, but had their good name ruined and their careers destroyed, and have found it very difficult to gain employment because they were unable to get references from their previous employer. Indeed, probably the worst thing that happened to them is that they were identified in their community as people who were perhaps stealing from pensioners or treating members of their community unfairly. This Bill will do nothing for them. Could the Secretary of State outline what the Post Office is doing to contact those individuals who were disciplined by the Post Office and dismissed, so that they too can have justice?

[Kemi Badenoch]

I thank my hon. Friend for that question. He is right that many people had their reputations traduced because of what happened with the Horizon scandal. Where shortfalls were falsely made by the Post Office and they had to pay, we have compensation schemes to address those sorts of wrongs. Because this Bill is specifically about overturning convictions, it cannot apply to them, but where they have suffered other damage, we have compensation schemes that we hope will apply in those circumstances.

We have not taken the decision to legislate in this way lightly. Given the factually exceptional circumstances of the Horizon scandal, the number of postmasters involved and the passage of time since the original convictions, it is right that the state now acts as quickly as possible. Any further delay would be adding further insult to injury for postmasters who have already endured what I believe is an arduous wait. Indeed, some have lost trust in the system, and want no further engagement. In many cases, the evidence they would need to clear their names no longer exists.

However, I must make two points clear to the House. First, the Government’s position is that it will be Parliament, not the Government, that is overturning the convictions, so there will be no intrusion by the Executive into the proper role of the judiciary. Secondly, this legislation does not set any kind of precedent for the future. It recognises that an extraordinary response has been necessitated by an extraordinary miscarriage of justice.

On this Bill receiving Royal Assent, no further action is required by the victims of this scandal to have their convictions quashed. The Government will take all reasonable steps to notify the relevant individuals and direct them to the route for applying for compensation. Further details of this process will be set out in due course.

[Liam Byrne]

The Secretary of State is being characteristically generous in giving way again. The evidence the Select Committee heard was that many people seeking compensation for the injustice they have suffered found it very complicated and very confusing to understand the range of case law required to put in particular kinds of claim—for example, for loss of reputation. When she triggers the notification provisions, would she reflect on something she could add, which is a tariff to help people put in claims for the right kind of compensation? What none of us would want to do, having overturned the convictions, is to let people get short-changed on the compensation. Providing a standardised tariff could cut through so much of the complexity and help people get what they are due.

[Kemi Badenoch]

I thank the right hon. Gentleman. I know that is a recommendation from his report, and it is something we are actively looking at and considering. As the Bill progresses through the House, there will be many suggestions that we will be able to look at to see whether it can be improved in any way. However, we must make sure that we do so in a way that does not jeopardise any of the objectives of the Bill—any of them at all.

As I was saying, further details will be set out in due course, and there will be a process for anyone to come forward where their convictions meet the criteria but we have been unable to identify them. The new primary legislation will be followed by a route to rapid financial redress on a basis similar to the overturned convictions scheme, which is currently administered by the Post Office, so we do not need provisions in the Bill to deliver that scheme. My Department, not the Post Office, will be responsible for the delivery of redress related to the quashing of these convictions. The Minister for postal affairs will return to the House at a later date to provide details on how we intend to deliver that redress.

[Mr Kevan Jones]

I welcome the changes that have been made in the compensation. Some of the proposals—for example, for fixed sums—are going to make a lot of cases easier to sort out. I do not feel comfortable having the Post Office anywhere near this, frankly, and neither do the sub-postmasters. Will the Secretary of State think about a system of compensation that in practice cuts out the Post Office? There is no trust there among the sub-postmasters. Do I personally have any faith in the Post Office? No, I do not.

[Kemi Badenoch]

I thank the right hon. Gentleman. That is one reason why my Department will be looking after the redress delivered by the scheme.

[Sir David Davis]

Let me reinforce the point made by the right hon. Member for North Durham (Mr Jones). There are people writing to me this week about the current handling of their cases by the Post Office and Post Office lawyers; frankly, it is barbaric. The Post Office needs to be taken out of it.

[Kemi Badenoch]

I reassure my right hon. Friend that this is something I am looking at in great detail. The Post Office has clearly been a dysfunctional organisation for a very long time, and that is one reason why I have been actively taking steps to look at the management and processes in place, which, as he rightly says, many of the sub-postmasters have lost faith in.

It goes without saying that work to offer prompt financial redress alongside the Bill continues. As of 1 March, 102 convictions have been overturned through the courts. Of those 102 cases, 45 people have claimed full and final redress, and of those 35 have reached settlement. The Post Office has paid out financial redress totalling £38 million to postmasters with overturned convictions. Under the Horizon shortfall scheme, as of 1 March, 2,864 eligible claims have been submitted, the vast majority of which have been settled by the Post Office, and £102 million has been paid out in financial redress, including full and final settlements and interim payments.

Finally, under the group litigation order scheme, working from the same date, 132 claims have been submitted, 110 have been settled by my Department, and £34 million has been paid out in financial redress, including full and final settlements and interim payments. Officials in my Department are working hard to get those cases settled quickly, and we have made offers within 40 working days in response to 87% of complete claims.

In summary, the Bill amounts to an exceptional response to a scandal that was wholly exceptional in nature, and has shaken the nation’s faith in the core principles of fairness that underpin our legal system. We recognise the constitutional sensitivity and unprecedented nature of the Bill, but I believe it is essential for us to rise to the scale of the challenge. The hundreds of postmasters caught up in this scandal deserve nothing less. Of course, no amount of legislation can fully restore what the Post Office so cruelly took from them, but I hope the Bill at least begins to offer the closure and justice that postmasters have so bravely campaigned for over many years, and that it affords them the ability to rebuild their lives. For that reason, I commend the Bill to the House.

Trade (Comprehensive and Progressive Agreement for Trans-Pacific Partnership) Bill [Lords]

Kemi Badenoch Excerpts

Report stage
Tuesday 19th March 2024 Commons Chamber

[The Secretary of State for Business and Trade (Kemi Badenoch)]

I beg to move, That the Bill be now read the Third time.

I would like to thank Members across the House and noble Lords in the other place for the interest they have shown in this legislation throughout its passage. The Bill may be narrow in scope, but the underlying agreement it relates to and the benefits it could bring for British business, the economy and the British people are wide-ranging. By acceding to the comprehensive and progressive agreement for trans-Pacific partnership, we will strengthen our ties with some of the world’s most dynamic economies and gain greater access to the Indo-Pacific region, which will account for the majority of global growth and around half of the world’s middle-class consumers in the decades to come.

Crucially, acceding to the CPTPP will mean improved market access for UK exporters in existing CPTPP parties, including Malaysia and Brunei—our very first free trade deal with these fast-growing economies. In turn, the partnership will simplify supply chains and cut costs for innovative firms based here in the UK, such as Wrightbus, a long-established family-owned Northern Ireland bus manufacturer, which will benefit from opportunities to import parts at lower tariffs from Malaysia. We have also agreed more liberal rules of origin with Malaysia, making it simpler for British brands such as Jaguar Land Rover to export British-designed, British-made vehicles to that market at lower tariffs.

However, our future accession will be good not just for British businesses selling their goods abroad but for consumers here at home. It could provide consumers with wider choice and cheaper prices at the supermarket checkout, on everything from Chilean and Peruvian fruit juices to honey and chocolate from Mexico. Inward investment in the UK by CPTPP parties will be encouraged when we accede, building on some £182 billion-worth of investment in job-creating projects in 2021 alone.

As hon. Members will know, the Bill affects the whole of the UK. Clause 3 and the parts of the schedule relating to Government procurement engage the Sewel convention, so we have sought legislative consent from the Scottish Parliament, the Senedd and the Northern Ireland Assembly. Let me reassure hon. Members that there has been regular engagement with the devolved Administrations before the Bill was introduced and throughout its passage at both Ministerial and official level. I thank the devolved Administrations’ Ministers and their teams for working so constructively with us. It is in part thanks to their efforts that the Scottish Parliament passed a legislative consent motion in February. The Welsh Government published a legislative consent motion on 5 March and recommended that consent be granted to clause 3 and relevant parts of the schedule. Due to a mis-step during the moving and consideration of the motion, that legislative consent was not granted. I understand there are plans for a further Senedd vote on legislative consent for clause 3 and relevant parts of the schedule. However, in the event that a further vote is not scheduled in the Senedd before Royal Assent, the UK Government will proceed with the Bill without consent from Wales.

Members will know that the Northern Ireland Assembly was suspended when the Bill was introduced last November, which prevented us from seeking legislative consent at that time. However, my Department has engaged with Northern Ireland officials throughout this period, providing them with updates as the Bill has progressed through Parliament.

[Jim Shannon (Strangford) (DUP)]

I thank the Secretary of State for her positive remarks about all the regions of the United Kingdom, which is good to hear. In her discussions with the Northern Ireland Assembly, has there been an opportunity to engage with the businesses in Northern Ireland that have been holding things together, and the Ulster Farmers’ Union? The Secretary of State is always energetic when it comes to pursuing those matters, but it is important to have that reassurance.

[Kemi Badenoch]

The hon. Gentleman raises a good point, and he is quite right. My right hon. Friend Minister for Trade Policy has engaged with them. In fact, upon the return of the Northern Ireland Assembly, he wrote to the Minister for Finance at the earliest opportunity to request legislative consent. I am grateful that the Minister agreed with the Bill’s devolution analysis and, in principle, to begin the legislative consent process. Nevertheless, we still face a challenging timeline and a pressing need for the Bill to complete its passage. That is vital to allow for secondary legislation to be made and for ratification of the UK’s accession protocol. As such, we cannot delay passage of the Bill to allow the Northern Ireland Executive and Assembly greater time to consider legislative consent. That would jeopardise all the current ratification timelines. I recognise that the legislative consent process is normally concluded before the last amending stage in the second House. Given the timing of the return of the Northern Ireland Assembly, that has been extremely challenging, but I believe it is still right that we allow the Northern Ireland Executive and Assembly as much time as we can to consider our request. In the event that legislative consent is not granted by the Northern Ireland Assembly before the deadline for Royal Assent, we will still have to proceed. Failing to do so would compromise the commitments we have made in our accession protocol.

On Second Reading, I outlined the wealth of benefits that will come with the UK’s accession to the CPTPP: the growth-spurring and business-boosting effect it will have on our economy. Since that time, we have had some spirited and worthwhile debates. I would particularly like to thank the hon. Members for Harrow West (Gareth Thomas) and for Gordon (Richard Thomson) for the constructive manner in which they scrutinised the legislation. I commend those Members who sat on the Public Bill Committee, including my hon. Friend the Member for Shipley (Philip Davies) and the hon. Member for Ealing Central and Acton (Rupa Huq), who showed their great expertise as Chairs. I also thank the Minister for Trade Policy, my right hon. Friend the Member for Chelsea and Fulham (Greg Hands) for expertly shepherding this legislation through the House with his consummate skill and good humour, and for delivering what appears to be a clean Bill. I will let Members review Hansard to see how many times my right hon. Friend reminded the hon. Member for Harrow West that he voted for CRaG. I think I heard that quite a lot throughout the debate.

It would be remiss of me not to mention a number of other Members by name for their valued input throughout the Bill’s passage, including my hon. Friend the Member for Totnes (Anthony Mangnall), whose Second Reading speech and interventions made an excellent case not just for UK accession to CPTPP, but for the benefits of free trade more generally. I am also grateful to him for highlighting the scrutiny provided by the recent Trade and Agriculture Commission report on the UK’s agreement to accede to the CPTPP—a report that stated that the CPTPP does not require the UK to change its levels of statutory protection in relation to animal or plant life, health, animal welfare or environmental protection.

On Second Reading, we also heard useful insights from several of the Prime Minister’s trade envoys, notably my hon. Friends the Members for Wyre Forest (Mark Garnier), for Gloucester (Richard Graham) and for Cleethorpes (Martin Vickers), as well as from the hon. Member for Liverpool, Walton (Dan Carden). The right hon. Member for Birmingham, Hodge Hill (Liam Byrne), as Chair of the Business and Trade Committee, brought a critical eye to bear on aspects of the underlying agreement, on which I hope he has now been reassured. My hon. Friend the Member for Penrith and The Border (Dr Hudson) rightly championed the UK’s high food and animal welfare standards that the Government will continue to protect, and my right hon. Friend the Member for Chingford and Woodford Green (Sir Iain Duncan Smith) demonstrated his well-honed ability to probe legislation with regards to the future potential accessions of economies to the CPTPP. The Business and Trade Committee more broadly has my thanks for its engagement with, and scrutiny of, this important Bill.

This legislation will help to ensure that the UK meets its international obligations upon accession to the CPTPP. When the Bill achieves Royal Assent, it will mean that we have put the UK at the heart of a dynamic group of countries in the Indo-Pacific, providing new opportunities for British companies to sell more of their high-quality goods and services to a market of over 500 million people and a combined GDP of £9 trillion. With that in mind, and in the hope that it will therefore garner support from all hon. and right hon. Members, I am pleased to commend the Bill to the House.

Turkey Trade Negotiations

Kemi Badenoch Excerpts

Thursday 14th March 2024 Written Statements

[The Secretary of State for Business and Trade (Kemi Badenoch)]

On Thursday 14 March 2024, the Department for Business and Trade launched negotiations for a new, upgraded free trade agreement with Turkey.

In line with our commitments to scrutiny and transparency, the Department for Business and Trade has published, and placed in the Library of both Houses, more information on these negotiations. This includes:

The United Kingdom’s strategic case for a UK-Turkey free trade agreement.

Our objectives for the negotiations.

A summary of the United Kingdom’s public consultation on trade with Turkey.

Scoping analysis, providing a preliminary economic assessment of the impact of the agreement.

The United Kingdom’s negotiating objectives for the upgraded agreement, published today, were informed by our call for input, which requested views from consumers, businesses and other interested stakeholders across the United Kingdom on their priorities for enhancing our existing trading relationship with Turkey.

These negotiations follow our signing of the UK-Turkey trade continuity agreement on 29 December 2020.

A new and enhanced trade agreement with Turkey is a key part of the United Kingdom’s strategy to secure advanced modern agreements with new international partners, and upgrade existing continuity agreements to better suit the UK economy.

The UK and Turkey are long-term strategic partners with deep economic links. Total trade in goods and services between the UK and Turkey was worth around £26 billion in 2022. Turkey is a dynamic economy with one of the fastest GDP growth rates among OECD members. An upgraded FTA with Turkey will aim to reduce and remove barriers in sectors of strategic importance to the UK such as services and digital trade, positioning British businesses advantageously for the opportunities of the future.

Our existing agreement, which forms the basis of our current trading relationship, is outdated and not designed for a digital age. While the existing agreement provides tariff-free access for 98.8% of UK goods exports by value to Turkey—based on 2021 figures—it contains only limited provision for the United Kingdom’s thriving services sector. We intend to change this by putting services at the heart of any new agreement, to benefit the UK economy. Upgrading our trade deal with Turkey will help to unlock a stronger, more advanced partnership. The new deal will play to our strengths, reflecting the realities of trading in the 21st century and allowing us to take advantage of future innovations.

Around 8,000 businesses from all parts of the United Kingdom exported goods to Turkey in 2022. Of those, 6,800 were small and medium-sized enterprises. The United Kingdom’s SMEs could be key winners from a new agreement with Turkey, as we seek to make it easier to do business and focus on trade barriers that may have deterred them from previously entering this exciting marketplace.

The Government are determined that any agreement must work for consumers, producers, investors and businesses alike. We remain committed to upholding our high environmental, labour, public health, food safety and animal welfare standards, alongside protecting the national health service. We will not negotiate a deal that undermines the UK’s points-based immigration system.

The Government will continue to update and engage with key stakeholders, including Parliament, the devolved Administrations and the Crown dependencies throughout our negotiations with Turkey.

[HCWS339]

Oral Answers to Questions

Kemi Badenoch Excerpts

Thursday 7th March 2024 Commons Chamber

[Bob Blackman (Harrow East) (Con)]

16. What recent progress her Department has made on negotiating a free trade agreement with Israel.

[The Secretary of State for Business and Trade (Kemi Badenoch)]

Israel remains a part of the FTA programme, and negotiations continue. I had a productive meeting with Israel’s Minister of Economy, Nir Barkat, last week in Abu Dhabi, where we discussed our existing trading relationship as well as how Israel is managing the challenges of working on an FTA while fighting a war.

[Nicola Richards]

Israel is facing immense challenges in its war with Hamas, but it is known around the world as a start-up nation thanks to its extraordinary tech sector, which Brits benefit from every day. Given the enormous opportunities that a bespoke free trade agreement with Israel offers to the UK, will my right hon. Friend update the House on what steps she is taking to advance negotiations?

[Kemi Badenoch]

My hon. Friend will be pleased to know that we held a virtual negotiating round with Israel in February, focused primarily on services. That is one of the things that we are doing to move the FTA forward, and we will update Parliament shortly in the usual way via a written ministerial statement.

My hon. Friend is right to highlight Israel’s world-leading tech sector, which is a reason why we want to modernise and upgrade our relations with Israel. Our current FTA was signed in 1995—it is a roll-over from the one we had with the EU—and technical collaboration, which Israel specialises in, will be made easier through an enhanced FTA.

[Mr Speaker]

I call Bob Blackman. Not here.

[Mr Alistair Carmichael (Orkney and Shetland) (LD)]

Can the Secretary of State give me some assurance that any free trade agreement with Israel will not allow the importation of goods produced in settlements on the west bank?

[Kemi Badenoch]

Yes, I can give the right hon. Member that assurance. We are clear under our existing UK-Israel trade and partnership agreement that Israeli goods originating from the State of Israel receive tariff preferences. We also have a separate interim agreement between the UK and the Palestinian Authority. I confirm that that will continue to be the case with an upgraded FTA with Israel. We will not compromise our long-standing positions on the middle east process throughout this negotiation, including with respect to settlements.

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[Martin Vickers (Cleethorpes) (Con)]

7. What assessment she has made of the impact of the UK’s withdrawal from the EU on businesses.

[The Secretary of State for Business and Trade (Kemi Badenoch)]

Since we left the EU, we have used our new freedoms to secure free trade deals with 73 countries, including EU partners, and that accounted for £1.1 trillion of UK trade in 2022. We have simplified import tariffs to lower costs for businesses and households. We plan to remove over 50% of inherited EU regulations by 2026. Our reforms to employment laws could save UK businesses up to £1 billion a year, ensuring that the UK is the best place in the world to start up and grow a business.

[Martin Vickers]

I thank my right hon. Friend for her reply. Measured by tonnage, the port of Immingham in my constituency is the largest port in the country, with almost 50 million tonnes of cargo each year. It is also a vital part of the renewable energy sector. Immingham is surely an example of the fact that not only EU trade but worldwide trade is important to the UK. If my right hon. Friend were able to visit at some time, she would be able to see that for herself.

[Kemi Badenoch]

As ever, my hon. Friend is a great advocate for his Cleethorpes constituency. He is right that Immingham is the No. 1 port in terms of tonnage and is vital to our trade with the EU and the rest of the world. If our diaries allow, I or one of my Ministers will be delighted to visit and see at first hand the vital role Immingham plays in the transition to renewable energy.

[Kirsten Oswald (East Renfrewshire) (SNP)]

In December, the British Chambers of Commerce found that a staggering 97% of surveyed businesses continued to face difficulties using the trade and co-operation agreement. Despite the TCA being introduced over three years ago, businesses are still struggling to deal with the added headache that the regulations have created. If 97% of businesses still face difficulties after three years, how many years is it anticipated that it will take for these issues to be resolved?

[Kemi Badenoch]

I thank the hon. Lady for her question. Many of the issues that businesses have been raising with us are specific not to the TCA but to member countries. That is why Ministers and I, along with officials, go to all these countries, and we have removed many of the market access barriers, which are not specific to the TCA. The hon. Lady will know that the TCA will be up for review. If she has specific things she would like us to take to EU Trade Commissioners, we are very happy to do so.

[Mr Tanmanjeet Singh Dhesi (Slough) (Lab)]

This week, the Financial Times reported the most significant decline in UK trade volumes since 1997. It is clearer than ever that this Government’s hard Brexit policy has exacerbated challenges for British businesses. With a 7.4% drop in trade since 2018 and exports down by 12.4%, we are starkly lagging behind our G7 peers. Can the Secretary of State explain how 14 years of Conservative rule have prepared British businesses for their despair around extra red tape and the chaos unleashed by this Tory hard Brexit policy?

[Kemi Badenoch]

I think the hon. Gentleman has just time-travelled from 2018 or 2019—it has been a long time since I have heard the phrase “hard Brexit”. He will of course know that we left the European Union with a deal, so he needs to catch up with what has actually happened. It is also interesting that he talked about an FT report from 1997; I should let him know that we have not been in government since 1997—we have been in government since 2010. Many of the things he is pointing out are things we have said will occur as trade flows move away from the European Union to the Indo-Pacific. That is why we have left; that is why we are trading with the rest of the world. The hon. Gentleman should also know that our economy is 80% services, so most of the things he is talking about will not impact on the vast majority of the economy. Services exports are booming, and we are doing well since leaving the EU.

[Sir John Whittingdale (Maldon) (Con)]

8. What recent progress she has made on negotiating a free trade agreement with South Korea.

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[Grahame Morris (Easington) (Lab)]

T1. If she will make a statement on her departmental responsibilities.

[The Secretary of State for Business and Trade (Kemi Badenoch)]

Last week, I travelled to Abu Dhabi for the 13th World Trade Organisation ministerial conference, where I met counterparts from many countries, including Australia, New Zealand, Canada and South Africa, along with trade representatives from the United States, European Union and the Gulf Co-operation Council. Alongside WTO members, we negotiated real outcomes for the UK and important agreements with our trading partners. We delivered for British business through the renewal of the e-commerce moratorium, a global agreement to avoid taxes on online transactions, from emails to movies and music. Building on the momentum from the 13th ministerial conference, we will continue to champion free, fair, open trade at every opportunity, recognising its potential to lower costs and increase prosperity, both here in the UK and around the world.

[Grahame Morris]

I thank the Minister for that statement.

We are no longer constrained by European competition law. The German Government are providing at least €6 billion in support for their steel industry. Given the very credible plan put forward by my union, Unite the union, to protect jobs and expand production at the steel plant at Port Talbot, why are the UK Government not investing more to create a viable future for our steel?

[Kemi Badenoch]

I am disappointed that the hon. Gentleman feels that we have not been investing as much as we should. What we have done in Port Talbot is the biggest investment that Government has ever made in steel. We are turning Port Talbot around; it is going to be regenerated. We are replacing high carbon emitting blast furnaces with electric arc furnaces to help reduce emissions, which his party and all of us across the House signed up to when we made the commitment to net zero. He may have specific things he thinks we can do on the transition, so I can tell him that we have a transition board to help those whose jobs are not going to be there with electric arc furnaces. However, we have done a significant amount for Port Talbot.

[Sir John Whittingdale (Maldon) (Con)]

T2. May I commend to my right hon. Friend the recent paper on industrial policy by Policy Exchange and its conclusion that we should avoid entering a subsidy race and should instead concentrate on broad, long-term measures supporting investment right across all industries?

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[Jonathan Reynolds (Stalybridge and Hyde) (Lab/Co-op)]

Last month, the Secretary of State said at the Dispatch Box that she could state explicitly that trade talks with Canada had not broken down. However, the Canadian high commission has since contradicted that in writing, saying that neither negotiations nor technical discussions with respect to any of the outstanding issues have occurred since the UK unilaterally broke them off on 25 January. Mr Speaker, I just want to know who is telling the truth.

[Kemi Badenoch]

I am very happy to expand on what I said last time I was at the Dispatch Box on this topic. I repeat that our engagement with Canada on trade issues has been extensive across multiple Departments covering the free trade agreement, cheese quotas and rules of origin. On 25 January, the UK confirmed to Canada that we would pause FTA talks on the basis that cheese access had been removed and that Canada had signalled that rules of origin provisions would not be extended. That is how negotiations work.

I can tell the hon. Member that there was a meeting on 8 February between the Foreign Secretary and his Canadian counterpart where the cheese issue was discussed, and I raised cheese and rules of origin directly with the Canadians in Abu Dhabi last week. I must say to the hon. Member that chasing headlines based on things he has been told by the people with whom we are negotiating is not helpful to achieving the outcomes that our businesses, farmers and auto industry want to see.

[Jonathan Reynolds]

That was a lot of words for the Secretary of State to use to say that she believes the Canadian high commission was correct in the answer that it gave.

May I ask an important question about the proposed UK carbon border adjustment mechanism? Labour very much supports the introduction of a UK CBAM, but we are concerned that the Government will do so a year after the EU, resulting in the UK potentially being flooded with carbon-intensive products originally destined for Europe, including steel, cement and fertiliser. Do the Government recognise that danger? If they do, what is their plan?

[Kemi Badenoch]

Just on the first point, if the hon. Member still wants to believe Canada before the UK, that is his business, but we on the Conservative Benches know who we are working for, and we are working for British businesses.

On the hon. Member’s second point, carbon leakage is a global problem facing all countries that are ambitious in tackling climate change, and we are working with international partners on how we tackle it together. We are following developments on the EU CBAM closely, and we are engaging with the European Commission to discuss technical considerations relevant to UK manufacturers. We share its concerns on carbon leakage, but we need to make sure that the UK response, whatever it is, is tailored to what the UK needs, not just a copying and pasting of what others are doing.

[Mr Philip Hollobone (Kettering) (Con)]

T4. Kettering is the beating heart of the east midlands economy, so will the Secretary of State be kind enough to facilitate a visit from her ministerial team to Ball Corporation in Burton Latimer? It has the newest, largest and most modern aluminium can manufacturing plant in Europe and a fantastic example of the very best of successful foreign direct investment into the UK economy.

[Kemi Badenoch]

I commend the Ball Corporation in Burton Latimer for all it is doing. I also thank my hon. Friend for what he is doing to promote inward investment, which supported more than 2,800 jobs across the east midlands in 2023. He has spoken to me before about the importance of the Ball Corporation to Kettering, and I am happy to confirm that either myself or one of my Ministers would be delighted to visit when diaries allow.

[Mr Speaker]

I call the SNP spokesperson.

[Richard Thomson (Gordon) (SNP)]

While the UK Government struggle to support small and medium-sized enterprises exporting to Europe, they are providing a £600 million export guarantee to INEOS so that it can build the largest chemical plant in Europe for 30 years in Antwerp, Belgium. Why can the UK Government find £600 million to support that investment, but not match the £500 million that the Scottish Government are investing in domestic energy transition at home?

[Kemi Badenoch]

UK Export Finance does not give the money; it provides guarantees to loans that are being provided by banks. There is quite a significant distinction: we have not given that money; we have guaranteed a loan. The reason why we provide those guarantees is that they guarantee jobs to British businesses. There is a big difference between a loan guarantee and giving money. If he would like more of an explanation on that, we are happy to provide one to him.

[Andrew Rosindell (Romford) (Con)]

T5. As chair of the British-Switzerland all-party parliamentary group, I am delighted to commend the Government on the forthcoming new trade agreement with Switzerland, but will the Secretary of State please update the House on progress? Particularly, will she tell us which of the 20-plus working groups the Government intend to prioritise as part of the negotiations?

[Marsha De Cordova (Battersea) (Lab)]

T3. We know the impact that mandatory pay gap reporting can have on tackling low pay and in-work poverty, but little progress is being made on tackling the disability pay gap, which is higher now than it was a decade ago, with disabled people earning on average £3,400 less—effectively working for 47 days for free. When will the Government introduce mandatory disability pay gap reporting, and what steps is the Secretary of State taking to close the gap?

[Kemi Badenoch]

The hon. Lady raises a significant issue around ensuring that disabled people are able to access employment and are paid properly. We have no plans to introduce mandatory disability pay gap reporting—no plans to introduce disability pay gap reporting at all. Unlike gender pay gap reporting, which is very simple, binary and easy to execute, disability pay gap reporting, like ethnicity pay gap reporting, is very complex. There are a range of disabilities that could not be easily monitored, so I would like to work with her on other areas where we can help to improve the lives of disabled people at work. We do not believe that disability pay gap reporting is the answer.

[Greg Smith (Buckingham) (Con)]

T6. [R] Israel is one of the United Kingdom’s most dynamic trading partners, so does my right hon. Friend agree that prioritising a free trade deal with Israel will complement the good work that the Government are doing to defeat the haters as part of the Economic Activity of Public Bodies (Overseas Matters) Bill, and send an unmistakeable message that the UK stands ready to strengthen our unbreakable friendship with Israel?

[Kemi Badenoch]

My hon. Friend is right. Israel’s current relationship with the UK is worth about £6.4 billion, but our FTA is a roll-over of the one that Israel signed in 1995 with the EU. It does not take into account services, digital, artificial intelligence or genome sequencing. There is a lot that we can do. That is why we are working on this FTA. It is a priority for us. As I said earlier, we face many challenges in carrying on negotiations with a country that is at war, but we are working to overcome them.

[Munira Wilson (Twickenham) (LD)]

T8. Quarter 4 of 2023 was the 10th quarter in a row in which more British businesses closed their doors than opened up. Just yesterday, a small business owner in Twickenham contacted me to tell me that his business was on the brink. If the Secretary of State will not consider business rate reform, as my hon. Friend the Member for Edinburgh West (Christine Jardine) suggested, what is she doing to help our small and medium-sized businesses, and to stem the tide of insolvencies?

[Mr Laurence Robertson (Tewkesbury) (Con)]

T7. Because of its very large population and economic activity, Nigeria offers many opportunities for British businesses. I understand that there was a recent ministerial visit to that country. Could we have a brief report of the outcome of that visit?

[Kemi Badenoch]

My hon. Friend is right. I signed the enhanced trade and investment partnership in Nigeria, alongside my counterpart, Dr Doris Uzoka-Anite, on Tuesday 13 February this year. It was the first of its kind in terms of the UK’s trade commitments across the region. The partnership aims to remove market access barriers and promote technical co-operation in areas such as financial and professional services. The UK and Nigeria have co-created a partnership that tackles issues that businesses face, and this is the first step in a significant relationship and an already strong trading partnership worth a total of £6.7 billion in the 12 months to September.

[Liz Twist (Blaydon) (Lab)]

T9. Last week, Carl Cresswell, director of business resilience in the Department for Business and Trade, told the Select Committee that he personally thinks that we will end up spending more money on Horizon compensation overall than that £1 billion currently allocated by the Treasury, but we did not hear anything about that in yesterday’s Budget. Does the Secretary of State share that view?

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[Mr Barry Sheerman (Huddersfield) (Lab/Co-op)]

When will the Secretary of State wake up to the huge potential of universities to tackle all the problems in society, including climate change? Will she come to Huddersfield, which has one of the best universities in the country? It is working with local businesses to make the future safe for our country.

[Kemi Badenoch]

If the hon. Gentleman sent a proposal to my office about what we could do on a visit to the University of Huddersfield, I would be very keen to take a look. We support our universities. If he has a specific business and trade angle in mind, we will see what we can do, if diaries allow.

[Richard Foord (Tiverton and Honiton) (LD)]

Mr Hussein from east Devon, whom I represent, has effectively been robbed of £100,000, given that £40,000 of sub-standard building work has to be levelled and destroyed. The Federation of Master Builders has campaigned for a compulsory licence scheme for construction companies. The Domestic Buildings Works (Consumer Protection) Bill would outlaw cowboy builders, provide compensation for consumers and ensure that reputable builders were not undercut by unlicensed rogues. Will the Minister take a fresh look at that Bill?

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[Kirsten Oswald (East Renfrewshire) (SNP)]

Goldman Sachs has found that Brexit Britain has significantly underperformed compared with other advanced economies; the result is that UK GDP is 5% lower than it would have been had we not left the European Union. Does the Secretary of State appreciate that best way to grow the economy, boost business confidence and reduce trade barriers is to rejoin to the EU?

[Kemi Badenoch]

I recommend to the hon. Lady the report produced by my Department on 31 January about the benefits of Brexit. It explains exactly what is happening with the UK economy. Claiming that GDP would have been 5% higher when we are outperforming our G7 partners is simply not credible. She wants to take us back to square one, but that is exactly the reason why people need to stick with the Conservative plan.

[Jim Shannon (Strangford) (DUP)]

I am very encouraged by the Secretary of State’s comments about the free trade deal with Israel. The UK is a friend of Israel, and Israel is a friend of the UK, so what more can we do to increase trade between us? More importantly—and very regionally —how can the Secretary of State ensure that Northern Ireland is very much part of that trade deal, so that companies in Strangford and across Northern Ireland also feel the benefit?

[Kemi Badenoch]

The hon. Gentleman will remember that we had the Northern Ireland investment summit, at which we talked about bringing more investment into Northern Ireland. He will know that around 500 Israeli firms operate in the United Kingdom. That investment from overseas is creating thousands of jobs in high-value sectors, and a free trade agreement will help to increase the investment. That will benefit businesses in Northern Ireland, too.

World Trade Organisation Ministerial Conference

Kemi Badenoch Excerpts

Tuesday 5th March 2024 Written Statements

[The Secretary of State for Business and Trade (Kemi Badenoch)]

Last week, I attended the World Trade Organisation’s 13th ministerial conference MC13—in Abu Dhabi with the Minister of State for Trade Policy, my right hon. Friend, the Member for Chelsea and Fulham (Greg Hands).

MC13 saw the world’s Trade Ministers come together to discuss the most pressing challenges facing global trade and agree a way forward.

The WTO members agreed several outcomes, including:

extending the moratorium on customs duties on electronic transmissions, which protects tariff-free digital trade, thereby maintaining lower costs and predictability for business engaging in digital trade;

re-committing to find a solution to restore the dispute settlement impasse, which is necessary to uphold global rules of free, fair and open trade and to ensure that every member of the WTO has access to a system to protect their trading interests against the unfair practices of other members;

extending the moratorium on TRIPS—trade-related aspects of intellectual property rights—non-violation and situation complaints;

a small package of outcomes on development, including easing the transition for countries graduating from “least developed country” to “developed country”, such as Angola and Bangladesh;

the Abu Dhabi ministerial declaration, which emphasises the importance of work on a range of important areas, including WTO reform, women’s economic empowerment, services trade and supporting micro, small, and medium enterprises.

MC13 also celebrated the accession of two new members to the WTO—Comoros and Timor-Leste—which will bring the total number of WTO members to 166 and help developing countries reap the benefits of free trade.

At the conference, we celebrated the entry into force of new disciplines under the Services Domestic Regulation Joint Initiative, which could lead to global savings of £99 billion through facilitating trade in services.

The UK is also pleased to have completed the investment facilitation for development agreement, which commits its 127 signatories to practical steps to make it easier to invest in developing countries. This means UK investors should benefit from reduced transaction costs in low-income countries under this agreement, which could increase stocks of outward UK FDI by £2.5 billion in participating members. The agreement will also cut red tape, providing a one-stop shop for investors to communicate with Government, and the creation of a single website that investors can go to for information.

The UK remains committed to the rules-based multilateral trading system as vital to the economic prosperity and trading stability of all the WTO’s 166 members. MC13 did not deliver on all of the UK’s objectives and was a stark reminder of the challenge of agreeing change on the consensus basis of the WTO. However, the WTO remains a critical, albeit imperfect, part of the global trading system that helps deliver global economic growth.

MC13 was also a great opportunity to meet with my international counterparts, including the Gulf Co-operation Council, the United States Trade Representative and the EU Executive Vice-President to progress MC13 negotiations, the New Zealand and Australian Trade Ministers to discuss implementation of the UK’s free trade agreements, and the Canadian Trade Minister to discuss bilateral trade relations, including rules of origin.

[HCWS310]

Post Office Governance and Horizon Compensation Schemes

Kemi Badenoch Excerpts

Monday 19th February 2024 Commons Chamber

[The Secretary of State for Business and Trade (Kemi Badenoch)]

With permission, Mr Speaker, I shall make a statement about Post Office governance and the Horizon compensation schemes.

Over the weekend, several serious allegations were made against the Government, my Department and its officials by Henry Staunton, the former chair of the Post Office. The allegations are completely false, and I would like to make a statement to the House so that hon. Members and the British public know the truth about exactly what has happened. I would like to address three specific claims that Mr Staunton made in his Sunday Times interview—claims that are patently untrue.

First, Mr Staunton alleges that I refused to apologise to him after he learned of his dismissal from Sky News. That was not the case. In the call he referenced, I made it abundantly clear that I disapproved of the media breaking any aspect of the story. Out of respect for Henry Staunton’s reputation, I went to great pains to make my concerns about his conduct private. In fact, in my interviews with the press, I repeatedly said that I refuse to carry out HR in public. That is why it is so disappointing that he has chosen to spread a series of falsehoods, provide made-up anecdotes to journalists and leak discussions held in confidence. All that merely confirms in my mind that I made the correct decision in dismissing him.

Secondly, Mr Staunton claims that I told him that “someone’s got to take the rap” for the Horizon scandal, and that was the reason for his dismissal. That was not the reason at all. I dismissed him because there were serious concerns about his behaviour as chair, including those raised by other directors on the board. My Department found significant governance issues. For example, a public appointment process was under way for a new senior independent director to the Post Office board, but Mr Staunton apparently wanted to bypass it and appoint someone from the board without due process. He failed to properly consult the Post Office board on the proposal; he failed to hold the required nominations committee; and, most importantly, he failed to consult the Government, as a shareholder, which the company was required to do. I know that hon. Members will agree with me that such a cavalier approach to governance was the last thing we needed in the Post Office, given its historical failings.

I should also inform the House that while Mr Staunton was in post, a formal investigation was launched into allegations made regarding his conduct, including serious matters such as bullying. Concerns were brought to my Department’s attention about Mr Staunton’s willingness to co-operate with that investigation.

It is right that the British public should know the facts behind the case, and what was said in the phone call in which I dismissed Mr Staunton. Officials from my Department were on the line; the call was minuted, and a read-out was sent after it took place. Today, I am depositing a copy of that read-out in both Libraries of the House, so that hon. Members and the public can see the truth. In those minutes, personal information relating to other Post Office employees has been redacted. For all those reasons, an interim chair will be appointed shortly, and I will, of course, update the House when we have further details.

Finally, Mr Staunton claims that when he was first appointed as chair of the Post Office, he was told by a senior civil servant to stall on paying compensation. There is no evidence whatsoever that that is true. In fact, on becoming Post Office chair, Mr Staunton received a letter from the permanent secretary of the Department for Business, Energy and Industrial Strategy, Sarah Munby, on 9 December 2022, welcoming him to his role and making it crystal clear that successfully reaching settlements with victims of the Post Office scandal should be one of his highest priorities. That letter is in the public domain. The words are there in black and white, and copies of the correspondence will be placed in the Libraries of both Houses.

The reality is that my Department has done everything it can to speed up compensation payments for victims. We have already made payments totalling £160 million across all three compensation schemes. That includes our announcement last autumn of the optional £600,000 fixed-sum award for those who had been wrongfully convicted. It is the strongest refutation of those in this House who would claim that we acted only after the ITV drama, “Mr Bates vs The Post Office”, was shown. British people should know that a dedicated team of Ministers and civil servants have been working around the clock for many months to hasten the pursuit of justice, and bring swift, fair redress to all those affected.

To that end, I am pleased that all 2,417 postmasters who claimed through the original Horizon shortfall scheme have now had offers of compensation. The Post Office is dealing promptly with late applications and cases where the initial offer has not been accepted. My Department has also established the Horizon compensation unit to ensure that money gets to the right people without a moment’s delay. Last autumn, we announced an additional £150 million to the Post Office, specifically to help it meet the costs of participating in the Post Office-Horizon inquiry and delivering compensation to postmasters. In all, we have committed around £1 billion to ensure that wronged postmasters can be fully and fairly compensated, and through forthcoming legislation, we are taking unprecedented steps to quash the convictions of postmasters affected by the Horizon scandal.

In short, we are putting our money where our mouth is, and our shoulders to the wheel to ensure that justice is done. It is not fair on the victims of this scandal, which has already ruined so many lives and livelihoods, to claim, as Mr Staunton has done, that things are being dragged out a second longer than they ought to be. For Henry Staunton to suggest otherwise, for whatever personal motives, is a disgrace, and it risks damaging confidence in the compensation schemes that Ministers and civil servants are working so hard to deliver. I would hope that most people reading the interview in yesterday’s Sunday Times would see it for what it was: a blatant attempt to seek revenge following dismissal.

I must say that I regret the way in which these events have unfolded. We did everything that we could to manage this dismissal in a dignified way for Mr Staunton and others. However, I will not hesitate to defend myself and, more importantly, my officials, who cannot respond directly to these baseless attacks. Right now, the Post Office’s No. 1 priority must be delivering compensation to postmasters who have not already been compensated. There were those who fell victim to a faulty IT system that the Post Office implemented, and that it turned a blind eye to when brave whistleblowers such as Alan Bates sounded the alarm. We said that the Government would leave no stone unturned in uncovering the truth behind the Horizon scandal, and in pursuing justice for the victims and their families. We are delivering on that promise, while looking for any further possible steps that we can take to ensure the full and final settlement of claims as quickly as possible.

It is right that we reflect, too, on the cultural practices at the Post Office that allowed the Horizon scandal to happen in the first place. It was a culture that let those in the highest ranks of the organisation arbitrarily dismiss the very real concerns of the sub-postmasters who are the lifeblood of their business and pillars of the local community. Although the Post Office may have failed to stand by its postmasters in the past, we are ensuring that it does everything that it can to champion them today, and to foster an environment that respects their employees and their customers. That is how we will rebuild trust and ensure that the British public can have confidence in our Post Office, now and in the future. I commend this statement to the House.

[Jonathan Reynolds (Stalybridge and Hyde) (Lab/Co-op)]

I firmly agree that the revelations in The Sunday Times at the weekend could not be more serious. In particular, if true, the claim that the Post Office was instructed to deliberately go slow on compensation payments to sub-postmasters in order to push the financial liability into the next Parliament would be a further outrageous insult in a scandal that has already rocked faith in the fairness of the British state. If that is the case, it cannot be allowed to stand, and if it is not, it must be shown to be false in no uncertain terms. We have two completely contrasting accounts: one from the former chair of the Post Office, and one from the Secretary of State. Only one of them can be the truth. I hope that we are all in agreement that Parliament is the correct place for these matters to be raised and clarified. What we need now is transparency and scrutiny.

Will the Secretary of State categorically state that the Post Office was at no point told to delay compensation payments by either an official or a Minister from any Government Department, and that at no point was it suggested that a delay would be of benefit to the Treasury? Will there be a Cabinet Office investigation to ensure that no such instruction or inference was given at any point? Crucially, is the £1 billion figure for compensation, which the Secretary of State helpfully just repeated, already allocated, and sat in the accounts of the Department for Business and Trade, ready to be paid? If it is not, will compensation payments be specifically itemised in the upcoming Budget?

The Secretary of State will also understand that following the story at the weekend, victims of other scandals—especially of the contaminated blood scandal—feel that they need to ask whether they have been the victims of deliberate inaction. Will the Government provide assurances that no such obstruction has been placed on any payments of this kind? If so, can they explain what the delay is in some cases? In the full interests of transparency, and to fully ascertain the veracity of any allegations for sub-postmasters and the general public, will she publish all relevant correspondence, and minutes of meetings between the Department, the Treasury, UK Government Investments and the Post Office during this time? Finally, when can we expect the legislation on exoneration that was promised by the Prime Minister?

I cannot stress enough that the last thing that was needed in this scandal was any further allegation of cover-up or obfuscation at the very top of Government. People’s faith in Government, already damaged by scandals such as Hillsborough, Bloody Sunday and Windrush, is hanging by a thread. This miscarriage of justice has shown the devastation that can occur when institutions are allowed to operate without oversight or are shrouded in secrecy. We should all agree that that secrecy must end, and that the full sunlight of public scrutiny should be brought to bear. If everything the Secretary of State has told us today is correct, surely there will be no objection to that happening fully.

[Kemi Badenoch]

I welcome the tone that the shadow Front-Bench spokesman has taken. There is often a tendency for political point scoring, but I think we both agree that this is very much about the postmasters. That is why I ensured that I was at the Dispatch Box: so that people would know the truth. That is what builds trust.

The shadow Minister asked whether I would categorically state that no instruction was given to delay payments. Yes, I can. We have no evidence whatever that any official said that. If such a thing was said, it is for Mr Staunton to bring the evidence. It is very hard to refute a negative. People making wild, baseless accusations and then demanding proof that they did not happen are making mischief, in my view. As far as I have seen, all the evidence points to the fact that no one gave that instruction.

It is also important to look at whether it would even make sense to do so. There would be no benefit whatever to our delaying the compensation, which has no significant impact on revenues. It would be a mad thing even to suggest. The compensation scheme, which Mr Staunton oversaw, has been completed. My understanding is that 100% of payments have been made, so clearly no such instruction was given. The hon. Gentleman mentioned the infected blood inquiry. This is a good example of how people lose faith in the system because of misinformation. That is why I am here to correct the record.

The hon. Gentleman asked about the £1 billion allocation. We give monthly reports that show exactly what payments are being made. He also asked whether we will publish correspondence. No, we will not publish in full all correspondence between Departments, UKGI and the Post Office. That is because we set up the statutory inquiry, which will examine the important issues related to the Horizon scandal, as well as current governance arrangements. We are fully co-operating with the inquiry, but the inquiry was set up by Parliament specifically to look at that. In addition to the read-out of the true content of my telephone call with Mr Staunton, we will consider publishing correspondence between Departments and Mr Staunton in accordance with freedom of information rules, so that people will know exactly what happened, contrary to his account. The hon. Gentleman asked about legislation. That is something that we are actively working on. I expect that we will be able to deliver on that imminently.

[Paul Scully (Sutton and Cheam) (Con)]

When I was the postal affairs Minister, the officials in my team not only shared my drive to get the money out of the door—life-changing money for postmasters—but were energised and empowered to do so. I cannot believe for a minute that just a few months later they would be doing and thinking the polar opposite. Clearly, they cannot defend themselves in public, so will my right hon. Friend confirm that conversations about colluding to slow down the compensation did not happen? It is important that we double down and get more money out of the door as soon as possible.

[Kemi Badenoch]

I pay tribute to my hon. Friend for all his fantastic work as the postal affairs Minister, and I can confirm that. My officials have looked through all the correspondence, and all the minutes of the conversations that Mr Staunton had with the Department. They found absolutely nothing, and he did not raise the matter in his call with me. If it were something that officials had said to him, surely he would have mentioned it to Ministers—either myself or the postal affairs Minister, my hon. Friend the Member for Thirsk and Malton (Kevin Hollinrake). The fact that Mr Staunton did not do so shows that it is quite likely something that he is making up.

[Madam Deputy Speaker (Dame Rosie Winterton)]

I call the SNP spokesperson.

[Marion Fellows (Motherwell and Wishaw) (SNP)]

I am at a loss today: another Monday, another Post Office scandal. I have tried very hard to pull together my thoughts on the statement, what was said in The Sunday Times, and what was said in this place less than two weeks ago when I led a Backbench Business debate on the culture of Post Office management.

I will ask the Secretary of State a few questions. Will she place on the record whether Nick Read wrote to the Justice Secretary last month defending the convictions, saying that some postmasters were guilty? That is a serious allegation, and I would really like to have an answer.

There has been talk all morning about damaging confidence in the compensation schemes. If there is confidence in them, can the Secretary of State explain why so many leading sub-postmasters affected by the scandal were given such derisory offers, months and months late? That is just not on. The Secretary of State cannot say that Henry Staunton damaged the compensation schemes; it was down to the Government and Post Office Ltd.

Is the Secretary of State aware that Post Office Ltd still employs 40 investigators who secured convictions? I agree with what the hon. Member for Stalybridge and Hyde (Jonathan Reynolds) said: exoneration must be hurried up and compensation must be paid sooner rather than later. I have said that every month for the last nine months.

[Kemi Badenoch]

The hon. Lady asks multiple questions. The first is about a letter written by Nick Read, Post Office’s chief executive, to the Justice Secretary. What I can say is that UKGI and Post Office Ltd have both vehemently denied that Nick Read was put under any pressure to write the letter she refers to.

On the risks of making a decision on blanket exoneration, the postal affairs Minister, my hon. Friend the Member for Thirsk and Malton (Kevin Hollinrake), has said repeatedly that we have been faced with a dilemma: either to accept the present problem of many people carrying the unjustified slur of conviction, or to accept that an unknown number of people who have genuinely stolen from their post offices will be exonerated and perhaps even compensated. That is the case, and it is certainly what the Government believe. What she says about people being put under pressure to write a letter is something that UKGI and Post Office Ltd have both vehemently denied.

The hon. Lady repeats Mr Staunton’s allegations, but I have already given a statement saying that they are completely false. She asks about individual cases of people who have been paid. I cannot comment on individual cases, but I would like to clarify that the main scheme in place under Henry Staunton’s watch was the Horizon shortfall scheme. Some 2,417 people were made offers within the original deadline. One hundred per cent have received offers, but 84% have accepted offers. I just wanted to clarify my previous comments.

On the 40 prosecutors still working for Post Office, I have had multiple people giving different bits of information. The inquiry is looking at that and will get to the bottom of it.

[John Redwood (Wokingham) (Con)]

Will the Secretary of State review the governance of UKGI? How did it manage to preside over the Post Office with its dreadful treatment of sub-postmasters? How did UKGI allow senior Post Office managers to rack up and accumulate losses of £1,390 million, effectively bankrupting the Post Office so that it can now trade only if it has the reassurance of massive cash infusions from the Treasury on a continuing basis? Surely this body has done very badly, and we need a better answer.

[Kemi Badenoch]

That is one of the reasons why we have been making personnel changes in this area. It goes back to the point I was making in the statement: Post Office needs an effective chair. Until the day I had the conversation dismissing him, I never had any correspondence from Mr Staunton about difficulties that he was having with UKGI. If he was having difficulties, he should have told me, rather than give an interview to The Sunday Times effectively stating that he had no control over the organisation that he had been appointed to run.

[Mr Kevan Jones (North Durham) (Lab)]

The Secretary of State says we have to accept that Henry Staunton’s accusations are completely false. The letter that Nick Read wrote to the Lord Chancellor about overturning convictions mentioned that about 300 people are possibly going to be “guilty”. She has just told the House that the investment body did not instruct him to do that. Henry Staunton said he did not tell Post Office to write the letter, and the board did not know about it, so who did? For the sake of openness and transparency, she should produce all correspondence between UKGI and Post Office. The Secretary of State has accused Henry Staunton of lying in public. The only way we can judge whether she is telling the truth is if we have all the information out there.

Can I just say to the Secretary of State, in relation to her obsession with tweeting, that although she says that people are jumping “on the bandwagon”, some of us have been involved in this for many years on a cross-party basis, including through work with her colleague the Under-Secretary of State for Business and Trade, the hon. Member for Thirsk and Malton (Kevin Hollinrake), so that is quite insulting. What message will the Secretary of State’s tone today send to sub-postmasters? I will tell her: more cover-up and obfuscation. Get the information out there and explain what is going on. Otherwise, she will not have their trust. It will just be more of the same that we have seen over many, many years.

[Kemi Badenoch]

I completely reject the right hon. Gentleman’s assertions. This is the political point scoring that I talked about earlier, which we just need to stop. Rather than focusing on the issue, he is talking about my tweeting. Maybe he should get off Twitter and actually listen to what I am saying at the Dispatch Box. He is talking about a letter that UKGI says it did not ask Nick Read to write. The only possible answer is that Nick Read himself decided to write that letter. I did not ask him to write it, the Post Office says that it did not, and UKGI did not. These are the sorts of things I am talking about—continuing to make aspersions about Ministers. We have made the Post Office an independent body, we have an independent inquiry, and the information will come out in due course.

[Sir Conor Burns (Bournemouth West) (Con)]

There is no doubt that there was a bad culture in the Post Office for a very long time. It misled a significant number of Ministers, who, to put it gently, could have been more inquiring over the years. Has my right hon. Friend had time to reflect on the words of the non-executive members of the board representing the postmasters, who say that only days before she sacked the chairman, there was still a culture in which they were viewed as guilty and on the take? If that sacking has brought compensation to those people, who were traumatised and misled by the Post Office, and who had their lives destroyed, her decision will go down as a very welcome one.

[Kemi Badenoch]

I agree with my right hon. Friend. The comments by the members of the board who are former postmasters are very interesting. They are saying exactly what I am saying: that Henry Staunton was not doing a good job as Post Office chair. That leads me back to the point made by the right hon. Member for North Durham (Mr Jones), who is more interested in attacking the Government than in looking at what even the members of the board are saying. It is important that we continue to give confidence to people that those organisations are run properly. That was the reason for the dismissal.

[Mr Alistair Carmichael (Orkney and Shetland) (LD)]

Having supported constituents in negotiations in relation to the historical shortfall scheme, I can tell the Secretary of State that, whatever the reason for it, the conduct of the Post Office and its agents was characterised by delay and obstruction. That, in turn, led to the view taking hold among sub-postmasters that there was no point in making claims. Since the ITV drama aired, I have heard of several constituents making belated claims. What more are the Government doing to ensure that everybody out there who may have a claim is able to receive compensation?

[Kemi Badenoch]

The right hon. Gentleman’s question is a good one. The fixed-sum awards show that we are taking the matter very seriously. I became Business Secretary in February last year, and my one priority was to ensure that people got their compensation as quickly as possible. I did everything that I possibly could, with the Minister with responsibility for the Post Office, my hon. Friend the Member for Thirsk and Malton (Kevin Hollinrake), whom I thank for his tireless efforts. He had been looking at the portfolio before I got the job as Business Secretary, and I knew that the work was in safe hands. We have worked together as a team, fought cross-departmentally to ensure that people got the compensation that they deserved, and brought in legislation just before December—well before the ITV drama. The cases that the right hon. Gentleman raises are important, as they show that there is still a lot of work to do, and we will continue doing it.

[Duncan Baker (North Norfolk) (Con)]

Given the Post Office’s track record with accuracy, I am very glad that we have heard from the Secretary of State—I would rather take her assurances at the Dispatch Box than anything from a disgruntled, sacked former employee of the Post Office. Even during last week’s recess, I still had constituents coming to me saying that they were affected by the Horizon scandal, so can the Secretary of State assure the people watching that the process is very quick and simple? People who still feel that they lost money during that horrendous period need to keep coming forward, because there is an easy process: they can fill in a form to make sure their voice is heard and that they get compensation.

[Kemi Badenoch]

My hon. Friend is quite right. I thank him for raising this issue, and also for the work he has done—as a former postmaster, he knows quite a lot about what has been going on. I reassure all of the people who have been affected by this scandal that it is something we take very seriously. When I became Business Secretary, I was absolutely horrified by the sheer scale of trauma that people had been going through. We want people to continue coming forwards; where they are not happy with the process, we will look at it again, but there is a formal process in place to ensure that all postmasters can be treated fairly, equally and equitably.

[Dame Diana Johnson (Kingston upon Hull North) (Lab)]

The allegations of limping towards the general election in relation to delaying compensation payments to postmasters mirror the Government’s behaviour towards the infected blood scandal. They have had the final recommendations for that compensation since April 2023, with no action having been taken, so it seems to me that there is a pattern of behaviour: the Government act only when they are forced or shamed into doing so. With the infected blood scandal, we have been told repeatedly by Ministers that the Government are working at pace. What that really means is that they are limping at pace, are they not?

--- Later in debate ---

[Kemi Badenoch]

No, no, and no. It is a shame that the right hon. Lady stands up in the Chamber and says that the Government acted only when we were forced to do so, because she knows that we brought legislation to this House well before the ITV drama. She knows about the Horizon shortfall scheme, the group litigation order payments and the overturned convictions. She is trying to mix this issue up with the infected blood inquiry, knowing that I have just proved that the allegations made by Mr Staunton are completely false. I have said that minutes will be put on the record showing that this is not an issue that Labour wants to look at beyond political point scoring. I will not stand at this Dispatch Box and allow that to happen.

[Miss Sarah Dines (Derbyshire Dales) (Con)]

At the weekend, leaks to newspapers appeared to show really poor embedded practices at the Post Office board, using language about our postmasters being “on the take” or “guilty”. What is my right hon. Friend doing to clean up the act?

[Kemi Badenoch]

My hon. Friend makes a very good point. That is why we need effective leadership at the Post Office; and it is why I took the decision to dismiss Mr Staunton, among the other issues I have covered in this statement. We need people who care, and one of the things that worries me is that because Mr Staunton has decided to have revenge in the papers, it is going to be even harder for us to find people who will come in and do this very difficult job. I hope they will not be put off by the misinformation that has been in the papers.

[Andrew Bridgen (North West Leicestershire) (Ind)]

I thank the Secretary of State for her prompt statement, and for laying out her version of events about the dismissal of Mr Staunton, the Post Office chairman. We have to accept her statements from the Dispatch Box, but I take exception to one point she made. She said that there was no evidence of stalling on compensation, but that evidence comes from the experience of my own constituents, Mr and Mrs Rudkin—their evidence to me was fundamental in unravelling this whole Post Office Horizon scandal. Susan Rudkin’s criminal conviction was overturned in December 2020—she was one of the first nine. When I spoke to Mr and Mrs Rudkin only a few weeks ago, over three years after that conviction was overturned, they still had not received their compensation. If that is not evidence of stalling, what is?

[Kemi Badenoch]

I cannot comment on that specific case, because I do not have the details, but a fixed sum award is available should Mr and Mrs Rudkin wish to take it. There is a process and we will move as quickly as we can. I cannot speak specifically about why there has been that delay, but we are doing everything we can to get the money out to the postmasters as quickly as possible.

[Richard Drax (South Dorset) (Con)]

I have a once-proud former postmaster in my constituency, who ran the post office in Swanage. He fell foul of this scandal and was sacked, not prosecuted. His life was utterly ruined and he repaid the money that was owed. That was many years ago, but his wife is now very ill and he has still not had compensation. May I make two points? First, his lawyer tells me that the compensation scheme is taking too long. Secondly, may I ask the Secretary of State for an assurance that he will not be brushed off financially simply because he was not prosecuted? The lives of this man and his wife have been utterly ruined.

[Kemi Badenoch]

I know exactly the sort of people my hon. Friend is talking about, and it is really awful to hear about everything they have been through. I have a constituent who has talked to me about how this scandal has ruined her life. We owe it to them to do everything we can to ensure that they are fully compensated, and I can assure him that Ministers and officials are working on this every day. I know it is not always as quick as people would like, but we want to ensure that it is done properly and that there are no issues following that. I do not have the specific details of that case, but they can apply to the Horizon shortfall scheme, and if my hon. Friend brings it to the attention of the postal affairs Minister, we will look at it specifically.

[Kate Osborne (Jarrow) (Lab)]

Ministers have promised that the Government will bring in a new law to swiftly exonerate and compensate victims, so can the Secretary of State tell me why my constituent Chris Head has been offered only 13% of his compensation claim? How can sub-postmasters trust the Government or the Post Office to deliver full and fair compensation when they are still facing so much pushback on their compensation claims and receiving offers that go nowhere near financial restoration, let alone compensation for the injustice? Can I quickly add that the Secretary of State’s suggestion that the Government would have acted in the same way had the ITV drama not been shown is thought to be completely unbelievable by most, and none more so than by the sub-postmasters themselves?

[Kemi Badenoch]

The fact is that when we took the legislation through the House in December, the Opposition Benches were empty. Opposition Members are the ones who decided to take a more keen interest after the drama; we have been working flat out. I do not have the specific details of her constituent’s case, as she knows, but I will continue to repeat what I have said, which is that where people have not received compensation, we can look at that. There is a process, and there is also an independent panel they can appeal to, but the vast majority of people who have been getting offers are taking them.

[Brendan Clarke-Smith (Bassetlaw) (Con)]

Too often, quango bosses are rewarded for failure and can walk away with big payouts, and it would be a disgrace for the man who has done so little to get compensation for postmasters to get any himself. Can the Secretary of State confirm that she will block any such payments?

[Kemi Badenoch]

There will be no payments to Henry Staunton.

[Sammy Wilson (East Antrim) (DUP)]

I think the public squabble at the weekend further undermines people’s confidence in what is going to happen and in the Government’s assurances about compensating the people affected by the Post Office scandal. I tend to believe the view of the Secretary of State, simply because the record of Post Office officials trying to cover up, pass the buck and cause confusion is on the record, and we know what they are doing. However, the fact remains that there are still people who have not had any offer of compensation, there is still £1 billion that has not been spent in compensation, and there are still people whose cases have not even been considered. Is not the best way of answering Henry Staunton for the Government to get on with the job and ensure that compensation is paid quickly, and for people to get the compensation they deserve?

[Kemi Badenoch]

The right hon. Gentleman is quite right. As I said earlier, 64% of people have received compensation, and we want to get that to 100% as quickly as possible. However, we want to ensure that people get the right amount and are compensated fairly, and that is why we have the process, including a point of appeal if they are unhappy with the offer.

The point the right hon. Gentleman made right at the beginning of his question is correct. The points made in the newspapers do undermine the work that we are doing. It was very disappointing to read those statements. It was also disappointing because I had done everything I could to try and keep this out of the news and do it behind closed doors, properly. I made sure when I gave public statements that I said I would not do HR in public. When I found out that it had been leaked to Sky News, I even called Sky News and asked—one of my assistants asked—for that not to be put out in the public domain before I had had a chance to speak to Henry Staunton. I did the same with the Daily Mail, which thankfully did listen. We also need the media to help us in this and not publish false allegations.

[Lee Anderson (Ashfield) (Con)]

I am absolutely staggered that the Labour party now seems to be coming out in support of the disgraced Post Office management team—the same management team that oversaw the wrongful imprisonment of postmasters across the country, with hundreds of convictions. Does my right hon. Friend agree that, when push comes to shove, that lot over there would take the side of the grifters, not the grafters?

[Kemi Badenoch]

As my hon. Friend says, the Post Office leadership oversaw wrongful convictions. That is one of the reasons why we have had multiple changes, and this is just the latest to ensure that we get the right leadership in place. [Interruption.] I know that some Opposition Members are dealing with this properly, but we can see from the heckling that many of them came here thinking that they could score political points, and I am not allowing that to happen.

[Sir Chris Bryant (Rhondda) (Lab)]

Many Members are of course angry and impatient about trying to get compensation and exoneration for all of the postmasters as soon as possible. If we are all honest, we as a whole Parliament should have been much more impatient much earlier. There are some rare exceptions to that, including my right hon. Friend the Member for North Durham (Mr Jones), who spoke earlier, and obviously Members on the Government side of the House as well. May I just clarify something about the process of Mr Staunton’s dismissal? As I understand it, he found out about it from Sky News. I think the Secretary of State just added a piece of information, which is that she then rang Sky News, before ringing him I think, to try and get them to stop running it. So she knew that this had already been leaked to Sky News, presumably from somebody in her Department. What investigation did she go through to find out who leaked it, and is that person still in post, because otherwise one might just worry that it might have been she herself who leaked it?

[Kemi Badenoch]

I knew that someone would ask that question. I in fact have evidence to show that I asked Sky News not to run the story. Of course I did not leak it—because if I had, that would have created legal risk if Mr Staunton had found out on the news before I had had a chance to speak to him. We have no idea how Sky News found out the information—several thousand people work in the Department for Business and Trade, and many more work at the Post Office and UK Government Investments. [Interruption.] The hon. Member for Rhondda (Sir Chris Bryant) is heckling, but the point I am making is that leaks are incredibly damaging and harmful; they create legal risk for the Department. I did not do so; I made multiple efforts with at least two media outlets to make sure that they did not create problems for Mr Staunton, and it is one of the reasons why it was very disappointing to see what he did in The Sunday Times at the weekend.

[Debbie Abrahams (Oldham East and Saddleworth) (Lab)]

To be honest, I am afraid I do not think that the Business Secretary and her statement have helped us to get closer to the truth in this situation; it is a question of the Secretary of State’s version of events and the former chairman’s version of events. For clarity, and to try to draw a line under this and get to the truth, is the Secretary of State willing to refer herself to the ethics adviser?

[Kemi Badenoch]

I think that is a ridiculous assertion, and from someone who clearly did not listen to the statement. The difference between what I am saying and what Mr Staunton is saying is that I have officials who will back me up, I have members of the Post Office board who will back me up, and I have newspaper and media outlets that know that I tried to stop the story. The fact is that the hon. Lady just wants to believe Mr Staunton’s allegations because that helps Labour politically, but they are not true. They need to listen to the truth and stop hoping for lies; that is not what our job is in this House.

[Clive Efford (Eltham) (Lab)]

If Henry Staunton is guilty of what the Secretary of State has accused him, it beggars belief that he was appointed only two years ago by this Government. May I ask her about Post Office investigations? I have yet another constituent who has come forward who was forced to sign a non-disclosure agreement by the Post Office and who has not been fully compensated for what they lost when they lost their business. Is it acceptable for the Post Office still to be involved with investigations, given how discredited those are? How can the victims of this scandal have any confidence whatever in the process that the Post Office is involved with?

[Kemi Badenoch]

The way we have been dealing with this issue at the Dispatch Box, the work that the inquiry has carried out and our commitment to look at individual cases and ensure that the process is working out properly is how the postmasters will have confidence in the system.

[Ben Lake (Ceredigion) (PC)]

In recent weeks, I have met with a number of constituents who are former sub-postmasters and who have explained the terrible impact that this scandal has had on their lives. Although they were not convicted by the Post Office, they had to pay large sums of money for shortfalls that frankly did not exist. Can the Secretary of State confirm that the Government’s expectation is that those people will be compensated not only for the money they paid, but the financial and personal harm that this scandal caused in their lives?

[Kemi Badenoch]

That is definitely what we are trying to do. No one should be in a worse position than they were in before the scandal happened. Where we can provide additional compensation, we will be able to do so, and that is what the process is set up to do.

[Stella Creasy (Walthamstow) (Lab/Co-op)]

Many of us will be concerned about the Department that oversees employment rights being one where thousands of people know that somebody is about to be sacked before they do. We would agree with the Secretary of State that the process is about giving the public confidence that when wrongs come to light, they will be righted. The challenge she faces is that the track record of recent decades is not good. It is not just about the Horizon scandal, but the nuclear veterans, Windrush, the Women Against State Pension Inequality Campaign, the infected blood scandal and Grenfell. Time and again, it is the compensation schemes that become the story and a source of injustice. Rather than taking to Twitter, would it not be the right rejoinder for her to become the first Secretary of State to say, “We should put the management of compensation schemes involving Government out to an independent body so that everyone can have confidence”? I am sure she would find support from Opposition Members for that.

[Kemi Badenoch]

First, I have not said that thousands of people knew that Henry Staunton was being sacked; I said that there are thousands of people who work in the Department, and it could have been anybody who put that out there. It is important that we stick to what has been said on the record. The hon. Lady mentions that these scandals go over decades, and I remind her that the Horizon scandal started under a Labour Government; it is this Government who are beginning to fix it.

[Barbara Keeley (Worsley and Eccles South) (Lab)]

On the shortcomings of the Horizon scheme, I raise with the Secretary of State the case of my constituent Mr Pennington, a sub-postmaster for 20 years, who went through 10 years of financial distress paying back shortfall amounts generated by errors in the Horizon system. The poorly designed Horizon scheme has paid back only part of the shortfalls of possibly £100,000—and only a paltry £1,500 for 10 years of financial stress and worry. I wrote to the postal affairs Minister four weeks ago and have not had a response. When will the shortcomings of the Horizon scheme be reviewed, so that sub-postmasters such as Mr Pennington receive full—not part—compensation for all those years of distress?

[Kemi Badenoch]

The hon. Lady is right to raise that matter. We are aware of the problem. We are working with the advisory board to see how we can fix it and ensure that people get proper compensation. I have just been told by the postal affairs Minister that the letter she is expecting should be with her shortly.

[Florence Eshalomi (Vauxhall) (Lab/Co-op)]

I thank the Secretary of State for her statement. She will be aware that many post office branches have closed in recent years, including the Clapham Common post office in my constituency, which is due to close on 6 March. In her statement, she said:

“Right now, the Post Office’s No. 1 priority must be delivering compensation to postmasters”.

Does she agree that millions of pounds spent on the Post Office trying to pay innocent sub-postmasters would have been better spent on ensuring that we keep our vital post offices up and down the country?

[Kemi Badenoch]

I thank the hon. Lady for her tireless work campaigning to save Clapham post office; I know she has had many meetings with the postal affairs Minister. We should be able both to keep post offices open and to compensate.

[Stephen Farry (North Down) (Alliance)]

As this is a genuine national scandal, the exoneration of sub-postmasters with criminal convictions requires that they be treated equally, with a shared speedy and common approach, across the UK. Both I and the recently reappointed Justice Minister in Northern Ireland have written to Ministers asking for Northern Ireland to be included in the forthcoming legislation. However, I understand that the Government are currently not minded to do that with the devolved Administrations. Will the Secretary of State confirm that Northern Ireland will be part of that legislation, which I hope will be brought forward soon?

[Kemi Badenoch]

The hon. Gentleman will know that Stormont is now up and running, and that we will be having conversations with devolved Governments on the best way to resolve this. We do not have an answer now, but we are aware of the issue and are working on it.

[Gerald Jones (Merthyr Tydfil and Rhymney) (Lab)]

The reports on the weekend were extremely alarming, given how sub-postmasters have been treated in recent years. On the obvious question, can the Secretary of State give any assurance or guarantee that the compensation will be paid and taken forward before the general election is called? That surely is what sub-postmasters would ask for, and it is the least that they deserve.

[Kemi Badenoch]

That is absolutely the right thing to do. I thank the hon. Gentleman for his question, because it gives me another opportunity to restate that the very idea that compensation would be delayed until after the election is complete nonsense. It does not even make political sense. We want to ensure that people get their money as quickly as possible.

[Jim Shannon (Strangford) (DUP)]

I thank the Secretary of State for her positive answers. Across the United Kingdom of Great Britain and Northern Ireland, hundreds of postmasters and postmistresses are still awaiting compensation for these wrongdoings. While it is understood that this is a sensitive subject for many, will she provide an update on the expected timescale for compensation of everyone who is entitled across the United Kingdom of Great Britain and Northern Ireland? The fact of the matter is, some people have waited two years, three years and longer, and it really cannot go on.

[Kemi Badenoch]

The hon. Gentleman is right: it cannot go on. I want to see everyone get their money as quickly as possible. By the end of this year, everybody should have received it. That is certainly what I am working towards.

Brexit: Fourth Anniversary

Kemi Badenoch Excerpts

Wednesday 31st January 2024 Written Statements

[The Secretary of State for Business and Trade (Kemi Badenoch)]

Today, the Department for Business and Trade will be publishing an update detailing the wealth of Brexit benefits the Government have seized since the UK left the European Union on 31 January 2020.

Since the UK’s departure from the EU, this Government have cut burdensome red tape for business. We have built dozens of trading relationships with new friends and old allies. And we have taken back control of our laws, borders, and tariffs. This new-found agility was crucial in helping us get through the pandemic with the fastest vaccine roll-out in Europe—which in turn allowed us to reopen our economy even sooner.

Where some predicted decline for Britain’s economy after Brexit, the UK has shown expansion.

Since the referendum in 2016, the UK has grown faster than Germany, Italy, and Japan and at a similar rate to France. Our services exports are at a record high of £472 billion and the IMF predicts that between 2024 and 2028 the UK will see the third fastest growth in the G7—stronger than France, Germany, Italy and Japan.

Through Brexit, the UK is capitalising on its economic might, while the Government deliver real, tangible benefits not just for British business but for the British people, too.

We have simplified import tariffs on almost 6,000 goods. Our UK global tariff is lowering costs for both businesses and households. And we have made it easier and cheaper for developing countries to sell to the UK—lifting people out of poverty abroad and lowering prices at home without compromising on quality.

The UK now has a little under 50% of products that are tariff-free compared to the EU’s 27%.

We have also knocked down approximately 500 trade barriers since 2020, including in the US—our single largest trade partner. We have signed memorandums of understanding with seven US states while agreeing quotas for British steel and aluminium—boosting exports and supporting 80,000 jobs across the UK supply chain.

No longer bound by EU state aid rules, we are driving growth in our coastal communities through our freeports programme. In Teesside—the UK’s biggest and first operational port—our tax reliefs, business rates retention policies and investment are helping to generate millions for the local economy while creating thousands of new jobs.

The Government are leveraging our post-Brexit freedoms to make the UK the best place in the world to start and grow a business.

We have already revoked or reformed over 2,000 pieces of EU law with a clear road map to go further.

At the same time we are making it easier for small and medium-sized enterprises—which account for over 99% of UK businesses—to raise finance while simplifying annual leave and holiday pay, and reducing onerous record-keeping requirements under the working time regulations.

Brexit has allowed us to undertake one of the largest shake-ups to procurement rules in this country’s history. Our new procurement regime means a simpler, more effective system, helping SMEs secure a greater share of approximately £300 billion of expenditure every year.

The update we are publishing today also shows that, in addition to delivering for British business and the British people at home, we are delivering for them abroad, too.

The Department for Business and Trade has negotiated free trade agreements with 73 countries from Mexico to Malaysia. We have secured the most comprehensive deal that the EU has ever agreed to in its history. These countries accounted for £1.1 trillion of our trade in 2022 alone.

Our trade deals with Australia and New Zealand—the first to be negotiated from scratch after Brexit—are helping home-grown companies break into new markets on the other side of the world, with the potential to bring in billions of pounds of new investment for the UK.

Our digital agreements with Singapore and Ukraine—regarded as blueprints by other nations striking similar deals—will boost our trading relationships in the digital economy and services sectors by extending market reach and ensuring the secure, tariff-free flow of digital content.

The UK will also shortly be joining the comprehensive and progressive agreement for trans-Pacific partnership. It will make over 99% of UK goods eligible for zero tariffs in the Asia-Pacific’s most dynamic economies.

This year, the Department for Business and Trade is seeking further deals with more fast-growing economies including the Gulf Co-operation Council and India.

We will cement global Britain’s status as an outward-looking, international trading powerhouse, redrawing the rules so businesses can thrive, markets are competitive and consumers are protected.

We will drive further investment from British and international businesses into our economy while strengthening our advice and support for home-grown companies looking to grow and export.

Over the coming year, we will continue to open up new markets for business, promoting free trade, economic security, and resilient supply chains as core pillars of the UK’s trade policy.

We are sticking to our plan to deliver the long-term change our country needs and build a brighter future for the United Kingdom, seizing the many opportunities and benefits Brexit has afforded the British people.

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