Monday 25 March 2019
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 United Kingdom will continue to apply the acquis so long as it remains a member state and, as set out in the withdrawal agreement, for the duration of the implementation period, if the withdrawal agreement is ratified by both the UK and EU.
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.
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 its approval. This assessment is based on the autumn Budget 2018 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 participates in 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 soon in both the House of Commons and the House of Lords, in order for both Houses to approve this assessment before the convergence programme is sent to the Commission. I will deposit a copy of a document to inform these debates in the Libraries of both Houses and copies will be available through the Vote Office and Printed Paper Office in advance of the debates.
The UK’s convergence programme will be available electronically via HM Treasury’s website prior to it being sent to the European Commission.
FCA: Retained Provisions of the Consumer Credit Act
In 2014, the Government fundamentally reformed the consumer credit market, by transferring regulation from the Office of Fair Trading (OFT) to the Financial Conduct Authority (FCA). This more robust regulatory system is helping to deliver the Government’s vision for a well-functioning and sustainable consumer credit market which is able to meet consumers’ needs.
As part of the transfer, the FCA was required in regulation 20 of the Financial Services and Markets Act 2000 (Regulated Activities) (Amendment) Order 2014 to undertake a review of the “retained provisions” of the Consumer Credit Act 1974.
In February 2016 the FCA published a Call for Input setting out its approach and seeking responses from stakeholders. In August 2018, the FCA published an interim report, which set out initial views and invited feedback. The FCA has now completed this review, and the Treasury has laid the final report before Parliament. Copies of the document are available in the Vote Office and the Printed Paper Office.
The Government welcome the FCA’s report, and the significant analysis undertaken by the FCA during the course of the review. The Government will consider the report and whether further reform of the consumer credit regulatory regime is needed.
Asset Sales Disclosure Guidance
The Treasury is today publishing new technical guidance concerning the disclosure to Parliament of Government asset sales.
The guidance is a further output of the Government’s balance sheet review and responds to issues raised in the Office for Budget responsibility’s 2017 fiscal risks report, as well as recommendations from the National Audit Office and the Public Accounts Committee about improving transparency and accountability for major assets sales. The guidance fulfils the commitment to fiscal transparency and accountability made in the Treasury’s 2018 managing fiscal risks to require Departments to disclose the impact of major assets sales on their balance sheets and the public finances as a whole.
The disclosure will take the form of a written ministerial statement (WMS) made to Parliament following the sale of an asset. The WMS will include the rationale for the sale, a justification of its timing and format, whether the sale was above, within, or below the retention value range, and the impacts of the sale on public sector net borrowing (PSNB), public sector net debt (PSND), public sector net financial liabilities (PSNFL) and public sector net liabilities (PSNL—the accounting impact).
A copy of the guidance can be found at:
Exiting the European Union
EU Withdrawal Joint Committee: Oversight
In my response to an urgent question on Wednesday 20 March, I stated that during the implementation period, we will “technically be a member state [of the European Union]”, that “payments or penalties [for non-compliance with the withdrawal agreement] would be imposed only by mutual consent”, and that “the CJEU will have some role in interpreting EU law, but we will be outside its jurisdiction”.
The correct position is that, first, during the implementation period, the UK will no longer be a member state of the European Union, but market access will continue on current terms.
Secondly, my statement that the Joint Committee cannot unilaterally impose financial penalties was correct: all decisions of the Joint Committee are mutual and, under the withdrawal agreement, neither party is allowed to impose financial penalties on the other, whether through the Joint Committee or not. However, for clarity I wish to confirm that the independent arbitration panel set up under article 171—which was referred to by right hon. Friend the Member for North Shropshire (Mr Owen Paterson)—can impose a financial penalty where a party has failed to comply with a ruling made against it.
This is not a unilateral imposition of a penalty by one party against the other, as it would be done by the arbitration panel, which is independent of both parties and made up of experts in both international and EU law, qualified for high judicial office. It could only occur under certain conditions as set out in the WA, and after all other stages of dispute resolution and crucially must be proportionate to the continuing breach that has been identified by the arbitration panel.
Thirdly, I also said that we would be “outside [the] jurisdiction [of the CJEU] ” after the end of the implementation period. While that is of course very largely the case, I should also remind the House that, in bringing the CJEU’s jurisdiction to an orderly end, there are a small number of limited areas where we have agreed we will continue to accept rulings for a time-limited period in order to facilitate legal certainty.
Health and Social Care
Mental capacity )Amendment) Bill: EVEL and Commons Consideration of Lords Amendments
I am today placing in the Library of the House the Department’s analysis on the application of Standing Order No. 83L in respect of the Government amendments tabled for Commons consideration of Lords amendments for the Mental Capacity (Amendment) Bill.
Housing, Communities and Local Government
Thames Estuary 2050 Growth Commission
At autumn Budget 2016, the Government asked the Thames Estuary 2050 Growth Commission to develop an ambitious vision and delivery plan for North Kent, South Essex and East London up to 2050. In June 2018, the commission, led originally by Lord Heseltine and concluded by Sir John Armitt, announced their vision for the estuary. I sincerely thank Sir John and all the members of the commission for their expertise and scrutiny across the duration of the commission.
Comparable in scale to the midlands engine, northern powerhouse and Oxford-Cambridge arc, the Thames estuary has the potential to deliver growth to support the success of the whole of the UK economy. The Commission envisioned that by 2050 the
Thames estuary will be a tapestry of productive places along a global river. The estuary will create 1.3 million new jobs and generate £190 billion additional gross value added.
The Thames estuary has long been a gateway to the wider UK economy but there remain pockets of entrenched deprivation within the region. And this area is not yet fully delivering on its great potential.
I welcome the vision for growth that the commission has set out. I am pleased to announce further commitments from this Government to support the delivery of the commission’s vision, including: £1 million to support a new Thames estuary growth board; appointing a Cabinet-level ministerial champion; £4.85 million to support local partners to develop low-cost proposals for enhancing transport services between Abbey Wood and Ebbsfleet, subject to suitable housing ambition; exploring the potential for at least two new locally-led development corporations; launching a strategic communications campaign to promote the Thames estuary as a great place to live, work and do business; funding for the creation of masterplans and feasibility studies on key sites in the Thames estuary creative production corridor; and bringing together relevant authorities to collaborate on the Thames estuary 2100 plan, to make sure that growth in the estuary is sustainable and resilient. My full response is available: www.gov.uk.
Our response to the Thames Estuary 2050 Growth Commission marks this Government’s commitment to this important area of the country. The Thames estuary has great potential to provide well-balanced, inclusive economic growth and will remain vital for the UK economy following Brexit.
Rough Sleeping Initiative
I am today announcing the allocation of a further £46 million rough sleeping initiative funding to support those sleeping rough and those at risk of sleeping rough in 246 local authorities.
This funding provides continuity from the £30 million fund for 2018-19, which was aimed at an initial 83 local authorities with the highest levels of rough sleeping in 2017.
The 2018 annual rough sleeping statistics showed a decrease of 639 or 19% in numbers of rough sleepers across these areas. While the programme is still in its infancy, the figures continue to demonstrate that the rough sleeping initiative has had a significant impact on the number of people sleeping rough and is working. Therefore, we are providing a further £34 million to these 83 areas in 2019-20.
I want to go further, and so launched a bidding round in December 2018 for those areas not in the initial 83 and I am pleased to announce that I will be providing an additional £12 million to a further 163 local authorities in 2019-20. This will continue to build on the work we have done so far to make sure we continue to support more people off the streets and into safe and secure accommodation.
This funding will provide for over 750 new staff focused on rough sleeping. This will include more outreach workers to engage with people on the streets, specialist mental health and substance misuse workers and dedicated co-ordinators to drive efforts to reduce rough sleeping in their areas. It will also provide for over 2,650 new bed spaces including both emergency, temporary and settled accommodation. The breadth of this funding will provide coverage of 75% of local authorities across England.
The rough sleeping initiative team, made up of expert advisers with knowledge and experience in areas such as mental health, specialist housing, substance misuse and criminal justice will continue to work closely with local areas to implement the plans and to monitor their progress.
I have deposited a full list of the individual amounts allocated to the 246 local authorities in the House Library.
I am confident this package of support will achieve substantial results across England. It will also build upon the work we have already undertaken. This work includes publishing our cross-Government rough sleeping strategy which sets out an ambitious £100 million package to help people who sleep rough now and puts in place the structures that will end rough sleeping once and for all, piloting the housing first approach, which has an internationally proven evidence base for effectiveness, in Greater Manchester, Liverpool city region and the west midlands, allocating over £1.2 billion in order to prevent homelessness and rough sleeping, including more upfront funding so local authorities can proactively tackle homelessness pressures in their areas, and, additionally, the introduction of the Homelessness Reduction Act which means that more people now get the help they need and at an earlier stage so preventing homelessness from occurring in the first place.