Thursday 3 April 2014
Convergence Programme (UK)
Article 121 of the treaty on the functioning of the European Union (TFEU) requires the UK to send an annual convergence programme to the European Commission reporting upon its fiscal situation and policies. The UK’s convergence programme will be sent to the European Commission by 30 April. This deadline was set in accordance with the European semester timetable for both convergence and national reform programmes. The Government support the European semester which plays an important role in EU surveillance of economic and fiscal policy.
Section 5 of the European Communities (Amendment) Act 1993 requires that the content of the convergence programme must be drawn from an assessment of the UK’s economic and budgetary position which has been presented to Parliament by the Government for their approval. This assessment is based on the Budget 2014 report and the most recent Office for Budget Responsibility’s economic and fiscal outlook and it is this content, not the convergence programme itself, which requires the approval of the House for the purposes of the Act.
Article 121, along with article 126 of the TFEU, is the legal basis for the stability and growth pact, which is the co-ordination mechanism for EU fiscal policies and requires member states to avoid excessive Government deficits. Although the UK is bound by the stability and growth pact, by virtue of its protocol to the treaty opting out of the euro, it is only required to “endeavour to avoid” excessive deficits. Unlike the euro area member states, the UK is not subject to sanctions at any stage of the European semester process.
Subject to the progress of parliamentary business, debates will be held on 9 April for the House of Lords and on 30 April for the House of Commons in order for both Houses to approve this assessment before the convergence programme is sent to the Commission. While the convergence programme itself is not subject to parliamentary approval or amendment, I will deposit advanced copies of the document in the Libraries of both Houses on 3 April and copies will be available through the Vote Office and Printed Paper Office.
The UK’s convergence programme will be available electronically via HM Treasury’s website after it is sent to the European Commission.
The Government are fully committed to tackling tax and national insurance avoidance and will take the necessary steps to protect the Exchequer and maintain fairness in the tax system.
We have introduced legislation which amends the agency legislation in the Social Security (Categorisation of Earners) Regulations 1978 (“the 1978 regulations”) to tackle avoidance, through false self-employment facilitated by intermediaries, of national insurance contributions (“NICs”). We have also introduced legislation, in the Finance Bill 2014, to tackle the same problem in relation to income tax.
The amendments to the 1978 regulations will come into force on 6 April 2014, as will the legislation relating to income tax (Budget Resolution No. 11, recorded in the Votes and Proceedings of the House of Commons for 25 March 2014).
The income tax legislation is supported by a targeted anti-avoidance rule (“TAAR”) which is intended to ensure that those workers who would be employees, but for the imposition of artificially constructed intermediary arrangements, are treated as employees for the purposes of tax.
I am today announcing that we intend to introduce a TAAR for NICs, with retrospective effect to 6 April 2014, at the next available legislative opportunity. This will support the 1978 regulations and ensure that those workers who would be employed earners but for the imposition of artificially constructed intermediary arrangements are also treated as employed earners for the purposes of NICs.
The TAAR for NICs will follow the TAAR for income tax, details of which can be found at clause 6, section 46A of the Finance Bill 2014 which was introduced into the House of Commons on 27 March 2014.
UK Guarantees Scheme
UK Guarantees was announced in July 2012 with enabling legislation, the Infrastructure (Financial Assistance) Act 2012, receiving Royal Assent on 31 October 2012.
UK Guarantees was launched in response to constraints in the long-term debt markets by providing a sovereign-backed guarantee to help infrastructure projects raise debt finance. In exchange for a guarantee a fee will be charged to the borrower, determined by the nature of the guarantee and the risks inherent in the project. Guarantees for up to £40 billion in aggregate can be offered under the initiative.
The Government are confirming that it has approved a guarantee for £257 million to Merseylink plc for the design, construction and operation of the Mersey gateway bridge PPP project.
The Government will report to Parliament on the financial assistance given in line with the requirements set out in the Infrastructure (Financial Assistance) Act 2012.
Statutory Guidance for Schools
Today I am publishing updated statutory safeguarding guidance for schools and colleges “Keeping Children Safe in Education”. Effective immediately, it has been sent to all schools and colleges and replaces “Safeguarding children and safer recruitment in education (2006)”.
“Keeping Children Safe in Education” provides guidance on: safeguarding systems including schools’ child protection policies and the appointment of a designated safeguarding lead; the checks necessary to carry out recruitment safely; and dealing with allegations of abuse made against staff members.
The guidance informs those working in schools and colleges about: types of abuse and neglect; where to find further information about the signs that a child may be being abused; how to refer a child about whom they have concerns; and signposts them to further, detailed information on specific safeguarding issues including female genital mutilation, child sexual exploitation, cyber-bullying, mental health, and radicalisation.
The publication of the new guidance follows a public consultation last year. I have also brought forward an amendment to the school staffing regulations (2009) to enable schools to choose the obligatory safe recruitment training that best suits their particular circumstances.
These changes will ensure school and college staff are clear about their statutory responsibilities and able to exercise their professional judgment with confidence in keeping children safe.
The new guidance will be available will be available on the Government website www.gov.uk.
Environment, Food and Rural Affairs
Agriculture and Fisheries Council
I represented the UK at the EU Agriculture and Fisheries Council on 24 March. Richard Lochhead MSP was also present.
Promotion of agricultural produce
The Council agreed its political approach to national co-financing and selection of programme proposals for promotion of agricultural produce. It set the ceiling for EU funding at 75%—85% in times of crisis—with producers making up the difference and national co-financing removed, in line with UK lobbying.
Management of sand eel—establishment of a total allowable catch (TAC) for 2014
The Council adopted by qualified majority a Council regulation setting up TACs in 2014 for sand eels and blue whiting. The UK abstained as the Council regulation had not cleared parliamentary scrutiny.
Coastal states consultations on mackerel and EU/Norway bilateral consultations
The Council discussed the outcome of the negotiations. The deal on mackerel reached between the EU, Norway and the Faroe islands 12 March was a major achievement, bringing to an end the long-running international dispute over the management of what is the UK’s most valuable stock. The Commission confirmed that discussions with Iceland would continue in the hope that it would also join the agreement.
The conclusion of a deal on mackerel also enabled bilateral fisheries agreements to be reached between the EU and Norway and the Faroe islands. These allow the joint management of shared stocks and give access to each other’s waters for 2014.
Overall the three agreements were supported by member states, though some expressed their concerns about the extension of the fully documented fisheries (FDF) scheme for North sea plaice in the EU-Norway agreement. The UK welcomed the agreements given the benefits they will provide for UK fishermen and responded to the concerns on extension of the FDF scheme by highlighting the importance of pilot projects to prepare for the discard ban. The Commission supported the UK position on FDF.
Processed meat labelling
The Council was divided on indications of the country of origin or place of provenance for meat used as an ingredient. During discussions three broad camps emerged: the UK and others favoured the current voluntary approach; a second group favoured mandatory labelling and a third group said that further discussion was necessary. The presidency decided to convene a working party to examine the report and member state positions further.
The Commission reported on its organic production proposal which aims to support the increased demand, while taking account of consumer standards, the risk of fraud and the need for transparency. It also encourages spending of both pillar 1 and pillar 2 funds on research and innovation in this area. There was no discussion, and the presidency confirmed that the proposal would now go to working group.
Fruit and vegetables
The Commission presented its report on the ED fruit and vegetable production sector following the reform of the sector in 2007. ED Fruit and vegetable consumption had reduced since the reform. However the percentage of the EU’s fruit and vegetables grown by producers that are members of producer organisations had increased during the same period. The Commission stated that it would bring forward specific proposals, with a focus on improving the long-term competitiveness of the sector. Again, there was no discussion but the presidency confirmed that this topic would be on a future Council agenda.
Any other business
Honey breakfast initiative
Slovenia explained its “honey breakfast” initiative which aimed to educate children on the importance of bees.
International year of family farming
Hungary reported on the convention it had hosted to celebrate the international year of family farming. The Commission noted that it would run a conference on the same topic in Bucharest next month.
Italy and other member states said that their rice sector was under pressure from imports from Cambodia. The Commission noted that the import tariffs imposed on developing countries had been zero rated to encourage development and that it would keep the situation under review.
Member states maintained the same positions outlined in last month’s discussion on the situation in the dairy sector. The Commission and presidency again noted the lack of a qualified majority in favour of the “soft-landing” on quotas and that the Commission would report in June.
Illegal, unreported and unregulated (IUU) fishing
Spain, supported by other member states, said it was firmly committed to combating IUU fishing, but was disappointed with the implementation of the regulation. They also had concerns about the transparency of the process for listing non-co-operating countries. The Commission disagreed that the process for listing non-co-operating countries was opaque or that they were not committed to the regulation. The Commission confirmed that the regulation would be reviewed next year but for now it was focused on its implementation.
Pharmaceutical Price Regulation
My hon. Friend the Under-Secretary of State for Health, Earl Howe, has made the following written ministerial statement:
I am pleased to announce today the publication of “Pharmaceutical Price Regulation Scheme: 12th Report to Parliament”.
The pharmaceutical price regulation scheme (PPRS) is a voluntary agreement with the pharmaceutical industry which is used to control the prices of branded medicines to the health service and limit the profits that companies can make on their health service sales. The Department published the first report on the PPRS in 1996 following a comment by the Health Committee that the
“Department of Health should introduce greater transparency into the PPRS”.
Since then, the Department has published a report to Parliament on the operation and management of the scheme most years, the last report being February 2012. This latest report includes an update on the outcomes of the 2009 scheme which terminated on 31 December 2013 and outlines the early operation of the 2014 PPRS which started on 1 January 2014. In addition, the report provides an update on progress in implementing the provisions under the 2009 scheme supporting the uptake of innovative medicines recommended by NICE, the Government’s broader support for the life sciences industry and commitment to the ongoing implementation of innovation, health and wealth.
A copy of the report has been placed in the Library. Copies are available to hon. Members from the Vote office and to noble Lords from the Printed Paper Office.
Social Science Research Committee (Triennial Review)
I am today announcing the publication by the Food Standards Agency (FSA) of the findings of the triennial review of the Social Science Research Committee (SSRC). Triennial reviews of non-departmental public bodies (NDPBs) are part of the Government’s commitment to ensuring, and improving, the accountability and effectiveness of public bodies.
The SSRC is an advisory NDPB that provides the FSA with independent expert advice on the use of social science evidence.
The review concluded that the functions performed by the SSRC are still required and that it should be retained as an advisory NDPB. It also identified a number of areas of good practice and made 13 recommendations to improve the efficiency and impact of the committee’s work and to ensure it continues to meet the highest standards of governance.
The review was carried out with the participation of a wide range of internal and external stakeholders, including the committee’s chair and members and the FSA chief scientist. The FSA is grateful to everyone who contributed to the review.
“Triennial Review of the Social Science Research Committee” has been placed in the Library. Copies are available to hon. Members from the Vote Office and to noble Lords from the Printed Paper Office. It is also available at: http://www.food.gov.uk/news-updates/news/2014/apr/triennial-review-ssrc
Work and Pensions
I intend to lay the Pensions Act 2011 (Transitional and Consequential Provisions) Regulations 2014 before Parliament in due course to come into effect in July 2014. These regulations make a range of provisions for benefits that were treated as money purchase, but that do not fall within the clarified definition in section 29 of the Pensions Act 2011. At the same time the Government’s response to the public consultation on the regulations will be published. The consultation received wide-ranging and detailed responses and we have taken the time to consider them fully.
Following the consultation I have assessed the implications of the retrospective application of the legislation very carefully. I can now confirm that in most cases transitional protection will be provided in respect of events occurring between 1 January 1997—the date from which section 29 of the Pensions Act 2011 is effective—and the date these regulations come into force in July 2014. This means that schemes will not need to revisit past decisions in almost all cases, but will ensure that in the future members are protected if their schemes are unable to pay benefits that have been promised.
Full information about other changes made to these regulations in response to the consultation will be included in our formal response when it is published.