Health and Care Bill

Debate between Peter Gibson and Kevin Hollinrake

Consideration of Lords amendments
Wednesday 30th March 2022 Commons Chamber

[Peter Gibson (Darlington) (Con)]

I believe that everyone should have high-quality, personalised palliative care, and that is why I am speaking in favour of Lords amendment 12 on palliative care. I wholeheartedly welcome the benefits that this Bill can bring to those in need of that care. I must mention the tireless campaigning of Baroness Finlay, as referenced by the Minister in his opening statement, and Hospice UK, which acts as the secretariat for the all-party parliamentary group on hospice and end of life care, of which I am a co-chair along with Baroness Finlay. Without their campaigning, we would not have been able to welcome this step forward. I should also declare my interest as a trustee of a hospice, and I draw the House’s attention to my entry in the Register of Members’ Financial Interests.

On the day of the publication of the Ockenden report and our discussion of good births, it is time that we started to talk about good deaths, too. There is far more that we need to do to ensure that hospices and palliative care providers have the tools they need to achieve this, and Lords amendment 12 certainly moves us forward. We need to ensure that the impact of the measures in this Bill are maximised. The Bill specifies appropriate palliative care, but we should expand on this to ensure that a fair minimum standard of care is provided. We should be providing statutory guidance to integrated care boards on the commissioning of palliative care, ensuring that the new requirements are clear. That point was ably raised by my hon. Friend the Member for North Warwickshire (Craig Tracey).

Funding certainty for hospices is essential. Certainty can enable them to better plan, support the needs of their local community and give commissioning boards confidence in relying on them as an integral part of local services. Certainty of funding will allow hospices to invest, innovate and integrate with the NHS and care system. Before the pandemic, adult hospices on average received 34% of their funding from Government, with some receiving little or none. Hospice funding came primarily from charitable donations, with the sector needing to raise £3.1 million every day. The pandemic saw donations, retail sales and fundraising activities fall dramatically, at the same time as an increase in service delivery. I want to put on record my thanks to the Government for the support that was given to all our hospices during the pandemic—and, in particular, to St Teresa’s in Darlington—but we need to see some certainty of funding for our hospices to deliver on this promise.

I am pleased that the Government accept Lords amendment 12. It is an important step forward for hospices and palliative care, and I welcome it.

[Kevin Hollinrake (Thirsk and Malton) (Con)]

It is a pleasure to speak after my hon. Friend the Member for Darlington (Peter Gibson). He made some very strong points in his speech with which I absolutely concur. I want to speak to Lords amendment 80, and his constituency—I know it pretty well, having been there and spent a bit of time there prior to the last election—is the kind that will be affected by it. The Government’s decision is to resist that Lords amendment, which I cannot support. In my view, this is a classic policy for levelling down, not levelling up.

The Minister is absolutely right—both Ministers involved in this Bill are good friends of mine, and I do not want to make their lives more difficult in any shape or form—when he says that the policy across the board is a significant improvement on anything we have had before. That is absolutely right. He said that in his speech, and I agree with it, but I do not agree with him when he says that it is fair. I do not believe it is fair, and that must be the basic criterion on which we judge any proposals, not least these.

I think everybody, including the Minister, accepts that it is quite clear that a £900 million transfer is happening here, which was introduced just as the Bill went on to Report stage. That is a direct transfer of £900 million from household wealth to somewhere else. That is what it is: a transfer of assets—household wealth—to healthcare, the Treasury or wherever else it is going, because that is the way that council contributions are used when it comes to the speed at which somebody reaches the cap.

I could live with that, if we were trying to make the system more affordable, as the Minister says—if the burden was going to fall equally on everyone’s shoulders in different parts of the country. It also true to say that most people will not be affected, because only people on very long care journeys tend to be affected badly, but there are quite a few of them: according to the Department’s own figures, about 6,000 a year—10 people per constituency—would be affected in this way, and most of them have dementia. We know that there are 900,000 people with dementia in the UK today; according to the Alzheimer’s Society, there will be 1.6 million by 2040; and 70% of care home residents are dementia sufferers, and they are the sort of people who will suffer because of the changes. They have very long care journeys, and they move out of their house so it becomes one of the assets that we take into account when assessing how much people contribute to the care cap.

The Minister says we are making these changes to make the system sustainable. Well, okay, make it sustainable, but make it fair too. I do not believe that this is fair. I know I am comparing this with a system that never existed—my hon. Friend is right to say that—but one was proposed in which the council contributions would count in calculations of people’s contribution to the care cap. That is the change we have made—the specific measure to make the system more sustainable is that change, and that affects people with limited assets and wealth. We are balancing this on the shoulders of people with fewer assets and less wealth, and on certain areas as well, as people in some of the regions in the north that we represent tend to have fewer assets and less wealth.

Particularly affected are people who have wealth or assets worth between £75,000 and £150,000. The research provided by the Alzheimer’s Society is clear: under the Dilnot proposals, about 50% of people living with dementia benefited fully from the care cap—they reached the care cap. That was true across all the wealth quintiles—it was very fair. This is not. Only 13% of people in the least wealthy quintile will reach the cap, whereas 28% of the most wealthy will. Such huge disparity cannot be right, yet that is the change that we have made. That £900 million has been found from people with less wealth. That cannot be right, nor is it consistent with levelling up. Look at how different regions are affected: only 13% of people in the north-east reach the cap whereas 29% of people in the south-east do so. Previously, in almost every part of the country, about 50% of people did so. The cap was not as generous, but it was very fair across different wealth quintiles and different regions of the country. I cannot see how this is fair.

Instead of each of us having 10 people in our constituency affected, some will have more and those representing wealthy constituencies will have fewer. I and other Members representing the north-east will have more constituents affected by this change and less generously treated because of it. For that reason, and because in my view it levels down, I cannot support the Government and will vote against them this evening on Lords amendment 80.

SMEs: Access to Finance

Debate between Peter Gibson and Kevin Hollinrake

Tuesday 9th November 2021 Westminster Hall

[Peter Gibson]

There is a lot to be learned in this area. My hon. Friend the Member for Thirsk and Malton and his APPG have been championing much of that learning, and I am sure the Minister has his listening ears on today.

The Department for Business, Energy and Industrial Strategy’s 2019 paper, “Equity Finance and the UK Regions”, confirmed that finance is too concentrated in London and the south-east, further increasing regional disparities, with London and the south-east of England receiving 67% of all equity deals and 75% of all invested funds in the UK between 2011 and 2017. The UK’s current financial system, which has historically been dominated by four large, shareholder-driven banks, is not fit for purpose in helping to address this issue. While a Back Bencher, my neighbouring MP, the Chancellor, my right hon. Friend the Member for Richmond (Yorks) (Rishi Sunak), said in his report, “A New Era for Retail Bonds”, that

“limp competition is likely to result in less availability of credit, higher prices and poor service for SMEs.”

SMEs tend to take smaller loans, and by nature tend to be riskier borrowers. The profit-maximising big four banks will steer away from lending to this demographic, especially when they are able to lend to larger, more profitable and secure companies.

[Kevin Hollinrake (Thirsk and Malton) (Con)]

My hon. Friend makes a good point about smaller loans. Last year, the Government—BEIS and the Treasury—did a fantastic job in rolling out SME finance schemes during the crisis. When those schemes were launched, the banks were initially only interested in lending amounts above £25,000—sometimes above £50,000. We were told there was no demand for smaller loans. Bounce back loans then came along and have been a huge success—£50 billion of lending. It is important we get money right to the bottom—to the smallest SMEs that are so critical.

[Peter Gibson]

I know how much work my hon. Friend put in last year to ensure that bounce back loans were available to small businesses, and I pay tribute to him for that effort.

Moreover, big banks tend to require large amounts of financial data from businesses when assessing their eligibility for loans. For a new or small company, this data simply does not always exist, but should that prevent them from being eligible for finance? SMEs need to be assessed on their business model and their economic potential in local areas and their wider potential contribution to society, not just on existing balance sheets—qualitative rather than quantitative. Yet this process is too time consuming for banks, preventing SMEs from crossing the first hurdle.

Due to the concentration of finance within large, shareholder-driven banks, SMEs are often not even aware of alternative lending providers and think that rejection from a big bank is a life sentence with a lack of finance. The current bank referral scheme, originally designed to help businesses access finance once rejected by a bank, fails to provide adequate information on a diverse range of borrowing options and fails to help SMEs understand why they got rejected, what financial products are best suited to them, and how they can optimise their application to get the best chance of success.

This environment discourages SMEs from continuing their search for finance, despite competitive, socially responsible and trustworthy alternative lenders being out there and wanting to lend to SMEs. In fact, as found by the Federation of Small Businesses in 2018, 73% of SMEs in the UK would rather grow more slowly than borrow. The Centre for Policy Studies also found that the UK is ranked 13th among the 14 OECD countries in the proportion of start-up businesses that grow to 10 people or more in three years.

I recall the huge leap of faith and risk I had to undertake when I began to grow my business. Moving from five to six employees was a big hurdle to overcome, as were the leaps to 15 and to 20 employees. The smaller you are, the bigger the hurdles. Moving from one employee to two is a doubling of the payroll, which will inevitably put a strain on small and fledgling businesses’ cash flow. Because that is so difficult, many businesses do not grow to their full potential.

The critical lack of diversity in the business lending market is detrimental to the resilience of the UK economy. As we continue to debate how the future regulation of the financial services sector should look, we must consider parts of the world where they are already doing well. Take one often-cited example from the critical post-recession period of 2008 to 2013: total bank lending to non-financial business in the UK dropped by about 25%. However, during the same period in Germany, where regional mutual banks and co-operatives are commonplace, lending increased by around 20%.

This critical lack of funding for SMEs is also detrimental to growth of the UK economy. The Department for Business, Energy and Industrial Strategy and the Office for National Statistics estimate that SMEs represent 99% of businesses. Their abundance means they have the potential to increase UK productivity. They are areas that the UK has struggled with for many years. More specifically, many SMEs contribute greatly to their local communities through increasing local employment, contributing to local economic growth and improving livelihoods. As the recent report of the APPG on social integration, which I chair, recently reported, SMEs were at the forefront of community volunteering during the pandemic.

I know the Minister is a good man. Although the Westminster Hall debate he is responding to today does not have the fireworks of yesterday’s, I can assure him that the solutions are within our grasp. It does not need years of planning and strategising; the solutions are out there. They just need support and political will.

First, we must deliver a strong local finance option for businesses in the UK. We cannot continue to deprive hungry and ambitious businesses of access to finance and scaling up, simply because they do not have access to the right financial product. We need to provide capital to community development financial institutions and regional mutual banks, to allow them to increase their offering.

Community development financial institutions are private finance institutions that are dedicated to providing responsible, affordable lending to disadvantaged communities and individuals. They do not prioritise profit, but prioritise allowing local-income areas to flourish. By providing finance as well as financial support and knowledge, CDFIs look at the wider benefits that each SME can provide to its local area, financing businesses that can make the biggest impact, even if they have been rejected by the big four.

Regional mutual banks have a more regional structure, prioritising relationship banking and making use of soft information to assess SME customers for credit.

[Kevin Hollinrake]

My hon. Friend makes a good point on regional mutual banks, and I congratulate him on bringing forward this important debate. It is also a pleasure to serve under your chairmanship. Mr Pritchard. Might my hon. Friend consider, in conjunction with his fellow MPs in the Tees Valley and the excellent Tees Valley Mayor, Ben Houchen, taking forward an initiative to set up a Tees Valley regional mutual bank?

[Peter Gibson]

That is an excellent idea, which I am sure my hon. Friend would be keen to help us spearhead. I am sure that Mr Houchen and the Tees Valley Combined Authority would relish the opportunity to bring more investment to the Tees Valley.

These finance providers tend not to have capital stock but are owned by their members, who have a say over the governance of the fund. Both regional mutual banks and CDFIs bring a refreshing approach to finance, prioritising local growth over profits—an approach that is much needed in today’s market. I know, too, from my own experience in business over 15 years before entering this place, that those relationships, with a dedicated relationship manager, are crucial.

Put simply, we need local solutions to local problems. Tees Valley Mayor Ben Houchen is leading the way in the north-east, having recently launched a new back to business fund worth £250,000, granting small and medium-sized businesses in the hospitality, tourism and events industry the help they need in their journey to recover from the pandemic. That is local leadership with local solutions.

Secondly, we need to turbocharge the challenger bank and non-bank lending sector. Such companies have provided a welcome challenge to the big four banks in recent years, yet they are currently hamstrung by disproportionate regulation. Reforming the minimum requirement for own funds and eligible liabilities—MREL rules—and providing access to the term funding scheme for non-bank lenders, will create a more level playing field for challenger banks in competing against the big four.

Thirdly, we need to continue Government initiatives to unlock patient capital from pension funds, by using social usefulness criteria, an idea currently used in France. We can unlock that money for investment in long-term, socially important companies.

Fourthly—last but certainly not least—we must ease the finance application process to encourage borrowing for growth. We need to ensure that business support services, such as local enterprise partnerships, the bank referral scheme and the British Business Bank—I am grateful to the hon. Member for Rutherglen and Hamilton West (Margaret Ferrier) for mentioning it—are properly funded.

Small businesses are the backbone of this country— 99% of businesses in the UK are classed as small. They play an essential role in strengthening our local economies, creating job opportunities and introducing innovation to their local communities. They are the businesses that support our local charities and volunteer groups. They are the people who sponsor the local football, cricket or rugby club, and they are the lifeblood of our towns across the land.

As we bounce back and build back better, we must take advantage of this opportune moment to reshape the financial services sector in a way that puts those hard-working businesses at its heart. Improving access to finance will provide SMEs with ample opportunity to scale up businesses and communities and improve employment chances across the country. In short, we need a financial services sector fit for everywhere, from Devon to Darlington—fit for the whole United Kingdom, not just the City of London.