Monday 18 May 2020
Housing, Communities and Local Government
Contingencies Fund Advance
I hereby give notice of the Ministry of Housing, Communities and Local Government’s intention to seek an advance from the Contingencies Fund. The Department requires an advance of its cash requirement pending parliamentary approval of the main estimate 2020-21.
Parliamentary approval for additional resources of £1,415,000,000 will be sought in a main estimate for the Ministry of Housing, Communities and Local Government. Pending that approval, urgent expenditure estimated at £1,415,000,000 has been met by repayable cash advances from the Contingencies Fund.
Future Trading Relationship with the US
Around 200 negotiators from the UK and the US held the first round of negotiations for a UK-US free trade agreement (FTA) between 5 and 15 May 2020.
More trade is essential if the UK is to overcome the unprecedented challenges posed by covid-19. New FTAs will be an important factor in facing that economic challenge, providing new opportunities for businesses and entrepreneurs who have faced significant challenges in this difficult period. An FTA with the US can help create opportunities for UK businesses, provide better jobs and boost the economy in every part of the country.
Both sides are hopeful that negotiations for a comprehensive trade agreement can proceed at an accelerated pace. Ambassador Lighthizer and I agreed that a second virtual round will take place in the weeks of 15 and 22 June, and that in advance of that negotiating teams will continue their work and meet virtually on a rolling basis, with meetings continuing throughout this week and beyond.
Negotiations over the past two weeks were conducted virtually but proceeded efficiently, with UK and US negotiators participating in extensive discussions in nearly 30 different negotiating groups covering all aspects of a comprehensive trade agreement. The discussions covered the following workstreams:
Small and medium enterprises (SMEs)
Rules of origin
Legal group—core text
Technical barriers to trade
Cross cutting services
Market access for goods, overarching and industrial goods
Good regulatory practice (GRP)
Sustainability, environment and labour
Market access for goods, agriculture
State owned enterprises
Market access for goods, textiles
Sanitary and phytosanitary (SPS)
The meetings were positive and constructive, reflecting the mutual commitment to secure an ambitious agreement that significantly boosts trade and investment between our economies, the first and fifth largest in the world.
Both sides recognised the unprecedented circumstances in which these negotiations took place, with significant emphasis placed on supporting the post-covid economic recovery.
During the meetings, the teams discussed their respective objectives and agreed on ambitious next steps for coming talks. Our preparatory work makes it possible for the UK and United States to quickly advance negotiations in a number of substantive areas that will shape our future bilateral trade relationship.
A number of areas showed particular progress, including where both teams identified positive alignment between respective negotiating positions. They identified a mutually high ambition for services, investment and digital trade, among other areas.
Both sides also set out a mutual commitment to creating new opportunities for businesses on both sides of the Atlantic and to delivering benefits for workers, consumers and farmers. This includes the confirmation that both sides will quickly pursue a standalone small and medium enterprises (SME) chapter and will continue the UK-US SME dialogue.
In the same manner as this negotiating round, discussions in the second round will cover all areas to be included in a free trade agreement.
The Government are committed to negotiating a comprehensive agreement with the US and we look forward to making further progress at the next round of negotiations. The Government will make a further statement on progress following the second round of talks.
Transport for London
It is vital that we take the necessary steps to protect the services which our critical workers, such as NHS staff, rely on—both in London and all across the country.
So far, we have invested billions into maintaining essential services across rail, buses, trams and ferries outside London, including £30 million over 12 weeks for light rail services in Sheffield, Manchester, West Midlands, Tyne and Wear, and Nottingham and almost £400 million to protect vital bus routes, and temporarily suspended rail operators’ franchise agreements to transfer all revenue and cost risk to Government so that services continue to run.
This is alongside our wider agenda to level up transport networks across the whole country, including £5 billion for buses and bikes announced back in February, £4.2 billion for local transport settlements for eight mayoral combined authorities subject to negotiations, a £1.7 billion transport infrastructure investment fund to improve roads, repair bridges and fill millions of potholes; and the decision by Government to take over the Northern network to protect services, drive up performance and rebuild passenger confidence.
We will continue to work with metro mayors, local authorities and transport operators all across the country to ensure that public transport is available for those who need it, including any ramp up in services required as people slowly start to return to work.
In order to keep vital public transport services running in London and further ramp up services to support social distancing, the Government agreed on Thursday 14 May a package of support for Transport for London. It comprises £1.095 billion of new grant and a further loan facility of £505 million. The support can be increased by a further £300 million of grant and loan if revenue loss is higher than forecast at this time.
The settlement for TfL was needed for two reasons. Most important is the significant fall in revenue caused by covid-19. However, an important secondary factor was the pre-existing poor condition of TfL’s financial position as a result of decisions made over the last four years. Combined with significant cost increases and delays to Crossrail, this left TfL in serious financial difficulty even before the public health emergency.
It is important to note that around half of all bus and rail journeys in England are made on its services and that London is by far the most public transport-dependent place in the UK. Almost half of all Londoners, more in inner London, do not have access to cars. London’s roads are the most congested in the UK; even with reduced passenger numbers and capacity, TfL’s services are still essential to allow critical workers to travel and the city to operate.
Unlike local transport authorities in other towns and cities across England, TfL is responsible for London’s bus network, principal road routes, various rail networks including the London Underground, London Overground, Docklands Light Railway and TfL Rail, as well as trams, cycling provision, and river services. To protect these services, it is important therefore that the rescue package takes steps to put TfL back on a sustainable footing while ensuring fairness for the wider British taxpayer. As a result, the Mayor intends to adhere to the proposal in TfL’s own business plan that fares should increase by RPI plus 1% on all modes in January.
We have also set a number of other conditions, including: restoring services to 100% of pre-covid levels as soon as possible; requiring TfL to collect fares on buses while ensuring driver safety, which it had stopped doing during the crisis; easing congestion by the temporary suspension of free travel for over-60s in the morning peak and temporarily suspending free travel for under-18s all day. Disabled people will still be able to make use of their concession passes all day, and special arrangements will be made for those children who qualify for free travel to schools.
These conditions are needed to avoid crowding and reduce the exposure of vulnerable groups. The Mayor has subsequently announced that the Congestion Charge will increase to £15, with extended hours of operation and has withdrawn the residents’ discount for new applications.
The Congestion Charge will continue to have exemptions for NHS and care workers and Blue badge holders. Local residents will continue to receive discounts.
To help avoid such drastic action in the future there will be an immediate and broad ranging Government-led review of TfL’s future financial position and structure.
The decision to offer support was not taken lightly, but reflects the exceptional circumstances the country finds itself in. I consider it vital to keep services in London running to the maximum levels possible to allow safe transport of passengers. Our messaging remains that people should avoid using public transport and work from home wherever possible, but as measures are slowly lifted it is vital that Londoners who need to use TfL services feel safe and secure.
This deal will encourage, help and protect those who need to use public transport and help us move towards greener and healthier walking and cycling options. Importantly, it will also provide certainty and stability for London’s transport services in the future.