Tuesday 10 March 2015
Business, Innovation and Skills
EU Competitiveness Council
My noble Friend the Parliamentary Under-Secretary of State for Business, Innovation and Skills, Minister for Intellectual Property, Baroness Neville-Rolfe, has today made the following statement.
The Competitiveness Council took place in Brussels on 2 and 3 March. I represented the UK during the internal market and industry discussion on day one, with Shan Morgan the Deputy Permanent Representative to the EU representing the UK for the research discussion on day two. I also attended a Council breakfast where Vice-President Ansip led a useful informal discussion on the digital single market.
The Council started by discussing and adopting the draft conclusions on single market policy. The text included calling on the Commission to adopt a sectoral approach to services, with the focus being on professional and business services, construction and retail. In the accompanying debate the Commission highlighted the single market as the most important pillar of its €300 billion investment package, pressed the need for single market rules to be adopted far more ambitiously and highlighted the cost of starting up a business as one the problems dampening investment and growth.
Several member states (MS) intervened to highlight the importance of an ambitious and sectoral approach to services liberalisation. MS also emphasised the importance of other sectors such as energy. I spoke about the importance of better enforcement and called for decisive action in the single market strategy. This could include legislation where necessary, but I reminded the Council that any new legislation should be drafted in accordance with better regulation principles. I highlighted the need for action on the regulation of professionals, the provision of indemnity insurance, and legal form and shareholding requirements in particular.
We then discussed the EU investment package which was also debated in relation to research on the following day. The presidency noted that discussions were under way in the ECOFIN Council. Some MS intervened to say that the EFSI (European fund for strategic investment) should address four key points—flexible management, rapid implementation, “additionally” of projects and the need for significant equity component. In response to this, the Commission said the EIB (European Investment Bank) was going to increase its support for SMEs and stressed that the investment package would not just remove funds from the Horizon 2020 package.
The next item related to the Frontrunners initiative by like-minded countries, including the UK, to share good practice in implementing the single market. I intervened to support the project and highlight the work of the UK in the projects on e-commerce and regulated professions.
We then discussed the implementation of transparency reporting requirements in the accounting directive. A number of MS emphasised the importance of a level playing field in extractives transparency reporting, and the important role the Commission has to play in ensuring the US authorities act quickly in bringing forward robust requirements. I intervened to highlight the importance of the EU continuing to show leadership in this area.
The afternoon session started with a discussion on the digital single market and EU industrial competitiveness. The Commission highlighted the importance of digital technologies within industry and set out five specific areas: spreading high-tech and digital technologies into all industrial sectors, not just the most advanced ones; ensuring internet platforms are “not instruments of control but instruments of opportunity”; developing interoperable standards for digital products; ensuring the regulatory framework was fit for digitalisation; and helping MS to address skills shortages so that there are more “digital executives”. MS were supportive of the areas identified by the Commission and there was broad support for the removal of barriers to e-commerce.
I emphasised the importance of industry leading in the development of smart products and of the removal of barriers to start up tech companies. I also highlighted the UK’s digital industrial strategy, and our focus on technology clusters, catapult centres, and improving the skills base including the teaching of coding in all primary schools.
The Commission gave a summary of the responses to the Single Business Act consultation. Most respondents agreed that the top priorities should be reducing administrative burdens and increasing access to finance. The Commission announced that a quarter of funding from the investment plan would be directed towards SMEs and that more information would be presented at the next Competitiveness Council in May. There were no interventions by MS.
The day ended with the Commission giving an outline of the energy union package which was published in February. The package consists of the energy and climate work programme; an “interconnections” communication on meeting the 10% electricity interconnection target; the Commission’s view of key elements of agreement in Paris; and its proposal for the EU’s contributions. The aims of the package are energy security and efficiency. There were no interventions from MS.
The Latvian presidency opened the research day of the Council with a discussion on the annual growth survey (AGS) and the Juncker package’s financial instrument (EFSI). They highlighted the importance of investment in excellent research for growth as recognised in the latest AGS published by the Commission, and the role of the Juncker package to achieve this. They also emphasised the importance of national initiatives and road maps to deliver the European research area.
The UK intervention, while welcoming the AGS’s emphasis on innovation, focused mainly on the investment package. The UK and others called for the investment selection committee to include expertise in the field of R and I investment and that the emphasis of Competitiveness Council discussion should be on ways we can encourage project uptake of the fund. The UK, on the back of significant concerns raised by university stakeholders, also asked the Commission to reassure academia that the “mainstreaming” of social sciences and humanities would continue to take place.
The second policy debate focused on unlocking Europe’s digital potential and alongside this Science 2.0 (AOB). This discussion mirrored one from the previous day on the digital single market but focused on the research aspects. The main discussion was around the need for research and innovation to have access to data and that the necessary systems should surround them, for example, data storage and management. The Commission stressed how rapidly data is growing and that to make the most of these opportunities, Europe needs the skills and a shared vision of the opportunities and gaps in the landscape. Two points were raised by the UK: copyright reform to address academic text and data mining and the need for data protection legislation to not hinder research, ensure the necessary protections and permit us to reap the benefits of big data. This received broad support. A joint UK-Netherlands non-paper on open access was also circulated and received a warm reception from several member states. The presidency concluded the debate by recalling that there would be Competitiveness Council (research) conclusions on this topic in May.
Despite not being on the agenda, the Commission introduced an AOB item on Partnership for Research and Innovation in the Mediterranean Area (PRIMA) initiative, to confirm the formal mechanism by which the initiative will be funded (through article 185 TFEU as a public-public partnership) and to announce that a proposal will be bought forward (this may take some preparation). Under an AOB item on the BONUS programme (which covers research in the Baltic sea), the Commission noted the positive evaluation of the programme and noted that BONUS members are looking at a possible BONUS2. There were no interventions by the UK on BONUS or PRIMA. The European research area (ERA) was only touched on briefly in the Council and over lunch, with the presidency outlining the process so far on the ERA road map and referenced the need to address ERA governance issues (such as the number and structure of expert groups) preparing the way for conclusions on this subject in May.
A meeting of the Economic and Financial Affairs Council will be held in Brussels on 10 March 2015. Ministers are due to discuss the following items:
Investment plan for Europe
The objective of the Council will be to reach a general approach on the proposal on the European fund for strategic investments (EFSI).
Current legislative proposals
The presidency will inform delegations about the state of play of legislative proposals in the field of financial services.
Implementation of the banking union
The Commission will inform delegations about the state of play on the bank recovery and resolution directive (BRRD) implementation and the ratification of the intergovernmental agreement (IGA) on the single resolution fund (SRF).
European semester: country reports
The Commission will present the “country reports” published on 26 February.
Implementation of the stability and growth pact
The Commission has issued assessments of the performance of France, Italy, Belgium and Finland under the stability and growth pact (SGP), and Council will discuss the Commission’s recommendation for next steps it may take for these countries.
Finance Bill 2015
The Finance Bill will be published on Tuesday 24 March.
Explanatory notes on the Bill will be available in the Vote Office and the Printed Paper Office and placed in the Libraries of both Houses on that day. Copies of the explanatory notes will be available online at: http://www.gov.uk.
Communities and Local Government
Firefighters' Pension Scheme Regulations
The Independent Public Service Pensions Commission, chaired by Lord Hutton, identified the need to reform public service pension schemes to provide a fairer deal for employees and taxpayers and to ensure that they are affordable and sustainable in the long term. The reforms to pension schemes are essential. People are living longer, with the average 60-year-old living 10 years longer now than they did in the 1970s. As a result, the cost of public service pensions has increased in real terms by around a third over the last 10 years and is now £32 billion a year.
Lord Hutton also found that the firefighters’ pension scheme 1992 is the most expensive public service pension scheme. Currently, for every pound a firefighter pays into the scheme, taxpayers are paying in an extra £5. In 2012-13, the scheme cost taxpayers £557 million. As such, on 28 October 2014, the Firefighters’ Pension Scheme (England) Regulations 2014 were laid, setting out the main elements of the new career average pension scheme to be introduced from 1 April 2015.
The firefighters’ pension scheme 2015 will provide one of the very best pensions available, with guaranteed benefits that are inflation proofed. The coalition Government recognise that firefighters regularly undertake duties under tough conditions and that they deserve a good and generous pension. This is why, since the start of the reform process, we have agreed to a number of enhancements, including improvements for those who choose to retire early. In the 2015 scheme, a firefighter retiring at 55 would see a 21.8% reduction to their pension—and no reduction to benefits earned in the 1992 scheme if the firefighter was a member of that scheme. This compares very favourably with the 40.5% reduction applied in the 2006 scheme which was introduced by the previous Administration. In addition, the normal pension age of firefighters is 60, and has been since 2006. It is lower than the pension age for other public sector workers, reflecting the physical nature of the occupation. A normal pension age of 60 is being retained for firefighters in the 2015 scheme.
Last month consequential regulations were made and last week we laid regulations setting out strengthened governance arrangements for the 1992, 2006, and 2015 firefighter pension schemes. Today, we are laying the final set of regulations required to ensure that the 2015 scheme can come fully into effect on 1 April, as required by the Public Service Pensions Act 2013. These include the Firefighters’ Pension Scheme (England) (Transitional and Consequential Provisions) Regulations 2015, which describe how the benefits of firefighters who are moving from the 1992 and 2006 pension schemes into the 2015 scheme, will be protected. Benefits already accrued by scheme members under the existing schemes will be preserved and continue to be linked to final salary. In addition, because of the strong protections already built into the 2015 scheme, no firefighter will have to work beyond their current expected normal pension age until 2022.
We are also laying two further orders. The first of these updates the provisions relating to compensation for injury so that they also apply to members of the 2015 scheme. This instrument also gives authorities an additional six months to complete the exercise of enrolling eligible firefighters into the modified scheme for retained staff who were unable to access a pension scheme between 2000 and 2006. The order also increases the pay bands that determine contribution rates under the 2006 scheme by 1% each year to 1 April 2018, in line with the 2015 scheme. This should avoid a scheme member being drawn into a higher contribution band because of a pay rise designed to reflect inflation. The final instrument makes this latter change, but in respect of the 1992 scheme.
The introduction of these regulations completes the new regulatory framework for firefighters’ pensions, fulfilling our commitment to completing the reform process within the lifetime of this Government, and ensuring that firefighters continue to receive one of the best pensions available in the public sector.
Local Authority Publicity
On 29 January 2015, I explained to the House, Official Report, column 28WS, the coalition Government’s commitment to protecting an independent free local press. This reflects commitments made in the coalition agreement, and the legislative provisions made by Parliament through the Local Audit and Accountability Act 2014. I described how the Government were seeking to take action on the practice by a small number of local authorities to publish local authority newspapers, which given their frequency of publication, can push out and undermine that independent press.
A very small number of councils continue to breach the recommendations of the local government publicity code about the frequency of publication for council newspapers. In my written ministerial statement of 3 March 2015, Official Report, column 49WS, I outlined the steps the Government are taking in relation to the continued weekly publication by the Royal Borough of Greenwich.
Today, I am announcing the conclusions to date of the review into the actions of three further councils; the London borough of Hackney council, the London borough of Newham council and the London borough of Waltham Forest council. Each of these has a fortnightly municipal newspaper.
In each case, my right hon. Friend, the Secretary of State for Communities and Local Government (Eric Pickles) is minded to exercise his powers in the Local Government Act 1986, as amended by the Local Audit and Accountability Act 2014, to direct the council to comply by no later than 30 April 2015 with the provision in the March 2011 code of recommended practice on local authority publicity that:
“Where local authorities do commission or publish newsletters, news sheets or similar communications, they should not issue them more frequently than quarterly”.
Accordingly, as required by the statute, the Secretary of State is today issuing to each of the three councils a written notice of the direction he proposes to issue to it.
In reaching these conclusions, the Secretary of State has carefully considered the representations each of these councils has made in response to a notice given to it on 25 September 2014 of a proposed direction relating to frequency of publication of council newsletters, newssheets or similar publications. He has also considered other information available to him about each of the three council’s publicity, and had regard to an equality statement about enforcing the 2011 code of recommended practice on local authority publicity.
Each council now has 14 days to make written representations to the Secretary of State about the proposed direction. Following this, the Secretary of State will take his final decision in each case about whether or not to issue the council with a direction. Each decision will be taken on its own merits.
I will be placing copies of the associated documents in the Library of the House.
Ofsted: Contingency Fund Advance
A budget and cash transfer of £19,400,000 to Ofsted has been agreed with the Department and HM Treasury and has been included in the 2014-15 supplementary estimate, for parliamentary approval.
Parliamentary approval for additional resource of £16,900,000 and additional capital of £2,500,000 for this service will be sought in a supplementary estimate for Ofsted. Pending that approval, urgent expenditure estimated at £19,400,000 will be met by repayable cash advances from the Contingencies Fund.
As Ofsted is a non-ministerial department, I am making this statement on behalf of its accounting officer, to ensure that Parliament is informed of this advance from the Contingencies Fund in the normal way.
Motorcycle Compulsory Basic Training Consultation
Research conducted in 2014 recommended a number of areas for the improvement of compulsory basic training for learner motorcyclists. I am today announcing a public consultation on proposals to strengthen the structure and delivery of the course.
The research was commissioned by the Department to gain a more detailed understanding of who is taking compulsory basic training and why; to seek the views of trainers and learner riders on the current course content and how any changes to the content or structure would affect them.
The Government recognise that motorcyclists, particularly those who are young and/or inexperienced are especially vulnerable and are disproportionately represented in the killed and seriously injured statistics. In 2013, motorcyclists accounted for 22% of all road user deaths despite representing only 1% of vehicle traffic; 19% of all reported motorcycle casualties involved young riders aged 19 and under.
Compulsory basic training has remained largely unchanged since its introduction 25 years ago. This consultation does not propose any changes to the syllabus of the course. However, as a result of the increasing numbers of new young riders who do not take a test and who feature in the casualty statistics, it is now appropriate to review the delivery of compulsory basic training, to help ensure that learner riders are better prepared to ride safely on today’s public roads.
The proposals set out in the consultation paper, which have been developed in conjunction with motorcycle stakeholders including trainers, are primarily aimed at younger riders. However, we believe that there will be benefits for all new riders as the changes proposed would also improve the training received by riders aged 24 and over.
The proposals under consideration cover three broad areas:
The structure and content of compulsory basic training courses;
The qualification process for instructors;
Standards checks for instructors.
A copy of the consultation paper has been made available in the Libraries of both Houses and can be found on the Department’s website at: https://www.gov.uk/dft#consultations.