Friday 15 March 2019
Advance from the Contingencies Fund
I, as the Minister for the Constitution, wish to report that a repayable cash advance from the Contingencies Fund of £1,297,000 has been sought for the Parliamentary and Health Service Ombudsman (referred to as the “Parliamentary Commissioner for Administration” in the Parliamentary Commissioner Act 1967 and the “Health Service Commissioner” in the Health Services Commissioners Act 1993).
The advance has been sought to meet a cash requirement resulting from planned expenditure set out in supplementary estimates. As authority for the cash will not be granted until March with the passage of the Supply and Appropriation Act, a Contingencies Fund advance has been requested.
Parliamentary approval for additional resources of £1,297,000 will be sought in a supplementary estimate for the Office of the Parliamentary Commissioner for Administration and the Health Service Commissioner for England. Pending that approval, urgent expenditure estimated at £1,297,000 will be met by repayable cash advances from the Contingencies Fund.
Single Defence Contracts: Baseline Profit Rate 2019-20
I am today announcing that I have set the baseline profit rate for single source defence contracts at 7.63%, in line with the rate recommended by the Single Source Regulations Office (SSRO). I have accepted the methodology used by the SSRO to calculate this figure.
I am also announcing new capital servicing rates and an SSRO funding adjustment as recommended by the SSRO, which can be found at table 1 below. These rates have been published in the London Gazette, as required by the Defence Reform Act 2014.
All of these new rates will come into effect from 1 April 2019.
Element 2018 rates 2019 rates Baseline Profit Rate (BPR) (% on contract cost) 6.81% 7.63% Fixed Capital Servicing Rate (% on Fixed Capital employed) 4.38% 3.98% Working Capital Servicing Rate (% on positive Working Capital employed) 1.21% 1.18% Working Capital Servicing Rate (% on negative Working Capital employed) 0.53% 0.53% SSRO Funding Adjustment -0.024% -0.042%
Baseline Profit Rate (BPR) (% on contract cost)
Fixed Capital Servicing Rate (% on Fixed Capital employed)
Working Capital Servicing Rate (% on positive Working Capital employed)
Working Capital Servicing Rate (% on negative Working Capital employed)
SSRO Funding Adjustment
Digital, Culture, Media and Sport
Contingency Liability Notification: British Tourist Authority
The Parliamentary Under-Secretary of State for Digital, Culture, Media and Sport (Michael Ellis): Today I am laying before Parliament a departmental minute describing a liability that the Department for Digital, Culture, Media and Sport intends to take on in relation to the British Tourist Authority (BTA) pension scheme.
The BTA, currently trading as VisitEngland and VisitBritain, has operated a defined benefit pension scheme for the benefit of its employees since it was created by the Development of Tourism Act 1969.
To ensure a strong covenant rating and avoid a substantial increase in the BTA’s annual contributions to service the scheme, the Government have decided to issue a guarantee to cover the shortfall between the scheme’s assets and its liabilities should the BTA close down. The shortfall is currently estimated at £125 million in today’s prices though is likely to decrease with time due to further BTA contributions to service the scheme, pension fund investment returns and scheme members passing away. Importantly, the guarantee will also allow the BTA board to ratify the cessation of defined benefit accrual and to agree a move to a defined contribution scheme.
The BTA was created by an Act of Parliament, and only another Act can close it down. I would like to reassure the House that the Government have no intention of bringing forward a Bill that would actually trigger this guarantee. As our national tourist board, the BTA undertakes invaluable work promoting the whole of the UK as a tourist destination and thus the likelihood of the liability crystallising is extremely low.
Justice and Home Affairs Post-Council Statement
The final meeting of EU Interior and Justice Ministers that the UK is expected to attend as an EU member state took place on 7 and 8 March in Brussels. I represented the UK for Interior day. The Secretary of State for Justice represented the UK on Justice day.
Interior day began with a progress report on the proposal to amend the European border and coastguard regulation. Ministers discussed the proposal for a standing corps of 10,000 border guards. The Home Secretary did not intervene as the UK does not participate in this Schengen building measure.
The Council then discussed the legislative proposals relating to the common European asylum system. Ministers discussed whether the package should be split between those measures that can be progressed now and those where further consideration is required, including the redistribution mechanism. I supported splitting the pack to ensure useful improvements to systems such as Eurodac, to which the UK has opted in, are agreed swiftly. Ministers were split on this issue. The UK has not opted in to the rest of the CEAS package.
Ministers then discussed co-operation with third countries on migration. Ministers broadly agreed that Morocco and Tunisia should be priorities, although some member states emphasised the importance of the western Balkans. I intervened to reiterate support for the whole-of-route approach to tackling illegal migration and noted the UK’s continuing commitment to co-operation with our European partners on migration.
Over lunch, Ministers discussed achievements and future activity in the JHA field. I intervened to reiterate the UK’s commitment to strong security co-operation post-Brexit. I made clear that while the UK recognised that the future UK-EU relationship on security would be different, that should not be at the expense of the protection of UK and EU citizens. I emphasised the importance of continuing operational co-operation against terrorists and organised criminals. I also noted that this was Commissioner Sir Julian King’s last JHA Council and thanked him for his work as Commissioner for the Security Union. My intervention was warmly received with a number of member states and the Commission paying tribute to the UK’s contribution in the JHA field and supporting the need for continued operational co-operation in this area.
After lunch, the Council discussed the state of play on the EU’s approach to counter-terrorism. Ministers broadly agreed that existing legislation needed to be fully implemented before moving on to further legislation. On terrorist content online legislation, the Commission and a number of member states, including the UK, urged rapid progress.
Finally, the Commission set out the measures the EU was taking to safeguard the forthcoming EP elections from interference and disinformation.
On Justice day, the Council reached a general approach on the e-evidence directive, which lays down harmonised rules on the appointment of legal representatives for the purpose of gathering evidence in criminal proceedings. There was wide support for this measure, with most Ministers noting that the e-evidence package as a whole represented significant progress in the ability of competent law enforcement authorities to access data held by communication service providers. The UK maintained its parliamentary scrutiny reserve. The Council would start trilogue negotiations on the whole e-evidence package, once the European Parliament has adopted its position.
The Council discussed the negotiating mandates for the second additional protocol to the Budapest convention on cybercrime and for an agreement between the EU and US on facilitating cross-border access to e-evidence. These mandates would complement the EU e-evidence legislative package. The Council broadly supported the EU-US mandate and the Commission indicated it would open discussions with the US in April, although some member states raised concerns around the Commission’s proposed approach in basing the mandate on draft EU legislation rather than the US’s CLOUD Act. Several member states raised concerns about the Commission’s assessment of EU competence in relation to the Budapest convention mandate. The Secretary of State for Justice noted the need for careful delineation between the second additional protocol and EU rules given the global reach of the Budapest convention. The presidency would seek to adopt the mandates at the June JHA Council.
The presidency noted progress at working level on the whistleblowers directive. The presidency would continue trilogues with a view to reaching a political agreement during the European Parliament’s current mandate.
The Commission provided an update on the establishment of the European Public Prosecutor’s Office (EPPO), noting the importance of concluding the process of appointment of the European Chief Prosecutor before the end of this legislature.
The Commission also informed the Council on progress made in countering hate speech online, and presented the results of the fourth monitoring of the code of conduct on tackling illegal hate speech. The Commission noted the need for further work to transpose the framework decision on racism and xenophobia and facilitate crossborder access to e-evidence.
Over lunch, Ministers discussed the use of artificial intelligence in the justice system. The Secretary of State for Justice highlighted the UK commitment to striking the right balance between ethical considerations and data protection on the one hand, and encouraging use of innovation on the other. The Secretary of State for Justice reinforced the UK’s ambition for a strong future EU-UK partnership.
Section 13(4) of the European (Withdrawal) Act
This statement is being made for the purposes of section 13(4) of the European Union (Withdrawal) Act 2018 and outlines how the Government intend to proceed in the light of the House’s decision on Tuesday 12 March 2019 not to agree to a resolution for the purposes of section 13(1)(b) of the European Union (Withdrawal) Act 2018.
The Government regret the House’s decision of Tuesday 12 March 2019 but still believe that the best way forward is for the UK to leave the EU in an orderly manner having agreed the withdrawal agreement and political declaration.
We note the House’s resolutions of Wednesday 13 and Thursday 14 March 2019 not to leave the European Union without a deal and to seek an extension to the article 50 process.
In accordance with the motion the House approved on Thursday 14 March 2019 the Government will now seek to agree an extension with the EU. The European Council has to approve any extension by unanimity, meaning it would require all the leaders of the other 27 EU member states to agree the UK’s request.
As the motion stated, if the House has passed a resolution approving the negotiated withdrawal agreement and the framework for the future relationship by Wednesday 20 March 2019, then the Government will seek to agree with the European Union a one-off extension of the period specified in article 50(3) for a period ending on 30 June 2019 for the purpose of passing the necessary legislation to implement the withdrawal agreement into our domestic law and complete the ratification process. However, if the House has not reached such agreement by the 20 March 2019 then it is highly likely that the European Council at its meeting the following day would require a clear purpose for any extension, not least to determine its length, and that any extension beyond 30 June 2019 would require the United Kingdom to hold European Parliament elections in May 2019.
It is expected that the EU will use the March European Council on 21 and 22 March 2019 to consider and reach a decision on a request from the UK to extend the article 50 period.
As soon as possible following agreement at the EU level we will bring forward the necessary legislation to amend the definition of exit day in domestic legislation. This statutory instrument will be laid, before it is made, under section 20(4) of the EU (Withdrawal) Act 2018.
This legislation is subject to the draft affirmative procedure and so would need to be actively approved in each House. The legislation would give effect to any agreement with the EU on an extension, so would not be laid before Parliament until that agreement had been reached.
Welsh Regional Investment
On 6 December 2018 I announced to the House that the UK and Welsh Governments had commissioned a joint independent review of the Swansea bay city region city deal. That review has now concluded and I am today publishing the report and a joint Government response.
I welcome the report which provides Governments, local partners and the private sector with the confidence to invest in the region and bring about economic growth and transformational change. The report recognises the continuing commitment of all partners to the deal, as well as the positive impact a successful city deal would have across the region. Both Governments accept the review recommendations.
Over the coming weeks the UK Government will work alongside the Welsh Government and local partners to implement the recommendations and to seek to move the deal into the next phase of delivery. I am determined that the city deal will deliver for communities in south-west Wales building on the foundation which this review provided.