Written Ministerial Statements
Tuesday 17 April 2012
Business, Innovation and Skills
Export Controls (Additional Measures)
Further to my written ministerial statement of 7 February on strategic export control, Official Report, column 7WS, I would like to update the House on progress towards increasing the transparency of the export licensing process. My officials have held meetings with representatives of the exporters and non-governmental organisations—these have been constructive and indicated that there is broad support for the proposals, although exporters understandably have some concerns about the burdens of making regular reports on their usage of open licences. Subsequently, my Department issued a discussion paper and questionnaire in order to obtain the widest range of views on specific aspects of the proposals. The paper and questionnaire are available at:
The closing date for responses is 20 April and I would encourage all interested parties to contribute their views. I will provide a further update as appropriate, at the very latest before the House rises for summer recess.
Big Society Capital
On 21 March last year, the Minister for the Cabinet Office and I updated the House on proposals and next steps for establishing a big society bank that would act as the central initiative for growing the social investment market in the UK, helping provide a third pillar of finance for the social sector, alongside philanthropy and the state. This is an important element of our strategy to help the sector become more resilient and effective.
The big society bank formally opened its doors to the public on 4 April as Big Society Capital. The new institution has been capitalised with the first tranche of dormant bank accounts and Merlin bank money, and we will thus have met a coalition priority
“to use funds from dormant bank accounts to establish a “Big Society Bank”, which will provide new finance for neighbourhood groups, charities, social enterprises and other non-governmental bodies.”
Today I would like to update the House on how Big Society Capital will work and progress made over the last year.
Big Society Capital (BSC) is the first social investment institution of its kind anywhere in the world. We are keen to support more social enterprise, whether it be new mutuals, social organisations delivering public services or community groups taking over assets. The purpose of BSC is to make it easier for these social entrepreneurs to access the capital they need. A new initiative is needed because the mainstream financial institutions are not yet providing that capital. BSC will build a bridge between mainstream finance and the social sector. It will do this by helping to grow the embryonic market of social investment—money that is prepared to blend financial return with social impact.
BSC will be capitalised using the estimated £400 million in unclaimed assets left in dormant bank accounts for more than 15 years, alongside £200 million equity investment from HSBC, Barclays, Lloyds TSB and RBS.
In line with the social investment strategy that we published in February last year, BSC has been set up with four core principles:
Independent from Government;
BSC will not be making grants. It will always invest because it needs to cover its costs and the mission is to prove and develop the concept of social investment. The wholesale function means that it will only invest in front-line organisations through intermediaries such as Big Issue Invest, Charity Bank, the Private Equity Foundation, and Bridges Ventures. There is widespread consensus on this positioning. If we were to set it up as a retailer, then we would distort the market and undermine the very intermediaries that we need to grow it. BSC will act as a cornerstone investor looking to support innovative methods of tackling social problems, such as social impact bonds, and encourage others to co-invest, significantly increasing the amount of finance available to the social sector.
Ahead of BSC opening we made early proof of concept investments to build the pipeline for the new organisation. To date, seven in principle investments totalling £7 million have been agreed, including: money to help the long-term unemployed set up their own businesses; two schemes supporting vulnerable young people to get into employment; an affordable housing fund; two community energy projects; and the development of the world’s first ever social stock exchange.
All of these investments will provide jobs and help disadvantaged groups or communities, supporting economic and social recovery.
We are grateful to Sir Ronald Cohen and Nick O’Donohoe for the invaluable support they provided in setting up this institution.
The new list of ministerial responsibilities has been published today. Copies are available in the Vote Office and have been placed in the Library. A copy will also be sent to every hon. Member.
The list can also be accessed on the Cabinet Office website at
Bilateral Loan to Ireland
I would like to update the House on the loan to Ireland.
Ireland completed the fifth quarterly review of its International Monetary Fund and European Union programme of financial assistance on 1 March 2012, at which point the utilisation period for the third instalment of the UK bilateral loan began.
Upon request, the Treasury disbursed the third instalment of £403.37 million on 28 March 2012, with a maturity date of 30 September 2019.
The Treasury will provide a further report to Parliament in relation to Irish loans as required under the Loans to Ireland Act 2010 following the end of the reporting period on 31 March 2012. Last year, the Chancellor committed to reduce the interest rate on the bilateral loan while still covering the UK’s cost of funding. To ensure that Parliament has the most useful and up-to-date information, subject to it being feasible to do so, I will lay this report alongside the finalised details of the new interest rate in the coming weeks.
The Government believe that it is in our national interest that the Irish economy is successful and its banking system is stable. The Government continue to support Ireland’s efforts to improve its economic situation.
Foreign and Commonwealth Office
I wish to inform the House of developments concerning the death of a British national, Mr Neil Heywood, in Chongqing in the People’s Republic of China on 14 November 2011. Mr Heywood’s body was found in a Chongqing hotel room on 15 November 2011.
On 16 November 2011, consular officials from the British Consulate-General in Chongqing were notified of Mr Heywood’s death by fax from the Public Security Bureau of the Chongqing municipality of China. Chinese officials informed our staff that the cause of his death was overconsumption of alcohol.
In line with FCO consular procedure, consular officials provided immediate and full consular support to Mr Heywood’s family in China as well as to his family in the United Kingdom. On 18 November, the family informed consular staff of their decision to have Mr Heywood’s body cremated, and confirmed this to us both in China and from the UK. An FCO official duly attended the cremation ceremony. We continue to provide full consular support to Mr Heywood’s family in China and the UK, including to Mrs Heywood, who is a Chinese national, holding a valid UK visa.
Foreign Office Minister, Jeremy Browne, was in Chongqing on 15 and 16 November. He met Mr Bo Xilai on the morning of 16 November. Ministers are not routinely told about the death of British nationals or other consular cases as they are so numerous. However, we need to make sure that they are told in relevant cases and we will review our procedures.
The Chinese police findings as to the cause of Mr Heywood’s death were called into question subsequently. Foreign Office officials were first made aware of rumours within the British expatriate community in China that there may have been suspicious circumstances surrounding Mr Heywood’s death from 18 January.
Allegations about Mr Heywood’s death were made by former Chongqing vice-mayor and chief of police Wang Lijun during a visit to the US consulate in Chengdu on 6 February.
Prompted by these increasing concerns, FCO officials informed me on 7 February of the case and the circumstances surrounding it. I immediately instructed them to make urgent representations to the Chinese authorities and to seek an investigation into Mr Heywood’s death.
On 15 February, after establishing as much information as possible and contacting the family, the deputy head of mission of the British embassy in Beijing met officials from the consular department of the Chinese Ministry of Foreign Affairs to convey this message. He informed them of our concerns about Mr Heywood’s death and the suspicion that he had been murdered, and conveyed our formal request that the Chinese authorities investigate.
On 21 February, HM Ambassador to China made the same request to Chinese Ministry of Foreign Affairs Vice-Minister for Europe.
Our ambassador repeated the request a week later to the Director General for Europe. In the absence of a formal Chinese response, on 22 March, the FCO’s consular director raised the case in the same terms with a visiting senior Chinese consular official in London.
On 10 April, before their official public announcement, the Chinese authorities informed HM Ambassador to China that an investigation into Neil Heywood’s death had begun and that proper judicial process would be followed.
I welcome the fact that the Chinese authorities have now committed themselves to undertake the investigation into Mr Heywood’s death that we sought. We now wish to see the conclusion of a full investigation that observes due process, is free from political interference, exposes the truth behind this tragic case, and ensures that justice is done.
We will continue to engage with the Chinese authorities on the progress of the investigation and we stand ready to provide any assistance necessary. FCO officials will remain in close touch with Mr Heywood’s family as this investigation proceeds.
This afternoon I will make an oral statement to the House on the next steps in the deportation of Abu Qatada.
Scottish Law Reform
I am publishing today a consultation paper that sets out the proposed reform of Scots law on two topics: unincorporated associations and criminal liability of partnerships.
The consultation document seeks views on two topics: first, the proposal to attribute legal personality to non-profit making unincorporated associations where they meet certain statutory criteria; and secondly, reform of the law on criminal liability of dissolved Scottish partnerships and their partners, with the principal intention to address a loophole in Scots law that allows Scottish partnerships to escape prosecution for potentially serious offences by dissolving.
The main proposals for unincorporated associations are that becoming a Scottish Association with Legal Personality (SALP) should not be dependent on any registration requirement and that office-bearers and members will not incur any personal liability by acting as an office-bearer or member. Accordingly, SALPs will have limited liability.
The proposals are based on work by the Scottish Law Commission which led to a report and draft Bill in 2009 on reforming the law on unincorporated associations in Scotland and a report and draft Bill in 2011 on reforming the law on criminal liability of dissolved Scottish partnerships.
The commission has indicated that it supports the consultation process and will continue to work with the UK Government to finalise a Bill that it is hoped will come before Parliament within its current term.