House of Commons
Monday 14 September 2020
The House met at half-past Two o’clock
[Mr Speaker in the Chair]
Virtual participation in proceedings commenced (Order, 4 June).
[NB: [V] denotes a Member participating virtually.]
Oral Answers to Questions
Work and Pensions
The Secretary of State was asked—
Access to Benefits: Post Offices
Ministers in the Department for Work and Pensions and the Department for Business, Energy and Industrial Strategy worked closely with the Post Office to ensure that vulnerable customers were able to access benefit payments during lockdown. It remains the case that at least 99% of customers with a bank, building society, credit union or Post Office card account can already access their benefit or pension payments at post office branches or post office ATMs.
Some 1.23 million people do not have a bank account. Given the DWP’s decision that new benefits or state pensions will no longer be collected using the Post Office card account, with the scheme officially closing in November next year, how will the Minister ensure that an estimated 300,000 vulnerable people can still access their benefits?
Any customer with a building society or credit union account will be able to continue to access their benefit or pension payments at a post office, even after the closure of the Post Office card account, including all bank accounts. There is also the ability to open a basic bank account, for which assistance can be given.
Welfare Benefits: Rent Arrears
As my hon. Friend knows, alternative payment arrangements are already available to enable housing costs to be paid directly to the landlord. We have listened to feedback, and in May we introduced a new online system for private landlords, so that claimants who struggle with managing their money get the right support promptly. Landlords can now request that a universal credit tenant’s rent is paid directly to them online, rather than by email or post.
I thank my hon. Friend for his answer. As he will know, it is estimated that 125,000 people are now in rent arrears, with rent not being paid to landlords. Many of those people will be in receipt of either universal credit or housing benefit. What steps can he take to ensure that that rent will be paid to landlords and to prevent spiralling debts that are impossible for people to repay, so that landlords are paid their rent and tenants do not fall into unnecessary rent arrears?
I thank my hon. Friend for that question. He is a passionate and knowledgeable advocate on housing issues, and I always listen carefully to his representations. Alternative payment arrangements such as direct payment to landlords can be requested by the tenant, landlord or work coach, but if there is more that we can do, I am happy to explore it. I regularly meet my counterpart at the Ministry of Housing, Communities and Local Government to discuss these issues, and I am happy to meet my hon. Friend.
Direct payments to landlords can help vulnerable tenants, but the issue remains that the design flaws in universal credit leave many tenants at risk. We now know that on average, new claimants of universal credit see a net fall of 40% of their income, one in eight tenants have built up arrears and there is a £440 million gap between what landlords believe they are owed and what tenants have paid. What immediate steps can the Minister take to deal with these structural problems, particularly the waiting period for universal credit, so that when the eviction ban is lifted next week, tenants are not at risk of losing their homes?
First, I welcome the hon. Lady to her place. I am afraid that I have to start by disagreeing. It is wrong to attribute a rise in rent arrears solely to universal credit. We know that many tenants are arriving on universal credit with pre-existing rent arrears, which universal credit actually appears to be helping to clear over time. There is no wait for universal credit; people can get an advance immediately. We recognise that this has been a very difficult time for people on low incomes, and that is why we have injected more than £9.3 billion into our welfare system.
Terminally Ill People: Welfare Support
I would like to thank all the organisations and charities that supported the consultation, which took longer than we had hoped due to covid-19. It is clear that there are three themes: the need to change the six-month rule, to improve consistency and to raise awareness of the support. We are working at pace across government to bring forward proposals.
Having supported a number of constituents with motor neurone disease, including a close friend, I have seen some of the challenges when faced with a terminal diagnosis. Can the Minister reassure me that the Government will not just replace the six-month rule with another arbitrary time limit of, say, 12 months? That would not solve the problem and would create barriers for patients and clinicians when it comes to navigating the special rules for terminal illness.
I pay tribute to the Motor Neurone Disease Association, which has been at the heart of this review. The Secretary of State and I are committed to delivering an improved system that raises awareness of the support, improves consistency and tackles the issue raised around the six-month rule. We are determined that this will be done as quickly as possible.
State Pension Errors: Retired Women
We are aware of a number of cases in which individuals have been underpaid category BL basic state pension. We corrected our records and reimbursed those affected as soon as the underpayments were identified, and we continue to check and remedy further cases that are identified.
With up to 130,000 women potentially affected, and with many of those women who have already contacted the DWP having been told, wrongly, that they are not entitled to any additional money, will the Minister say what more he is going to do, in the light of the miscommunication that affected thousands of women represented by the Women Against State Pension Inequality campaign, to ensure that the women affected are contacted and given the correct information?
As the hon. Lady knows, I cannot comment on the live litigation in respect of the WASPI women, although I can say that at the first hearing before the judicial review, notification and communication were found for on behalf of the Government—this Government, the coalition Government and the Labour Government whom she served. In respect of category BL pensions, we are improving the training and the ability of the individuals who are handling the cases.
I join my hon. Friend the Member for Kingston upon Hull North (Dame Diana Johnson) in paying tribute to the WASPI women. Estimates suggest that as many as 130,000 women could have been underpaid their state pensions. Will the Minister confirm the total number who have been affected by the Department’s error and how he intends to ensure that they receive the full amount to which they are entitled?
This matter dates from 2008 and a Labour Government who introduced the particular changes. The Department continues to check for further cases, and if any are found, awards will be reviewed and any arrears paid in accordance with the law. We continue to encourage anyone who believes that they are being underpaid the state pension to contact the Department for Work and Pensions.
This issue is in addition to the UK Government continuing to deny justice for WASPI women at a time when women are disproportionately impacted, socially and economically, by the coronavirus outbreak. The Scottish National party believes that mistakes were made in the changes to the state pension age and has repeatedly called on the UK Government to oversee a full impact assessment that considers the wide-reaching effects of the detriment felt by 1950s-born women. Will the Minister commit to a full impact assessment on both issues?
The hon. Gentleman knows that I cannot comment on live litigation, but he also knows that when the High Court heard the judicial review, it found for the Government on all the issues that he outlines. I point out that sections 24, 26 and 28 of the Scotland Act 2016 give the Scottish National party Government in Holyrood extensive powers to intervene, if they choose to do so.
Up to 130,000 women who have been denied their pension entitlements through pension underpayments are awaiting justice. An investigation is under way; when will it finally conclude so that those women, many of whom are in their twilight years, get the justice that they deserve? To make a bad situation worse, the Government pledged in their manifesto that they would honour the triple lock; we now hear that they are considering scrapping the triple lock when UK pensioner poverty is the worst in Europe. Will the Secretary of State commit today that her party will not add to its long list of U-turns by scrapping the triple lock?
I really think the hon. Gentleman needs to talk to his good lady wife, the right hon. and learned Member for Camberwell and Peckham (Ms Harman), because she was the Secretary of State for the Labour Government who so grievously underpaid state pensions such that the coalition Government and this Government have now transformed basic state pension so that it is more than £1,900 a year higher than it was a decade ago. That is thanks to the actions of the coalition Government and this Conservative Government. The House will be aware that the matters the hon. Gentleman raises in respect of category BL state pension were a result of the changes brought in by the regulations introduced under the Labour Government in 2008.
Employment Support: Local Labour Market
We recognise that some areas and some sectors of the economy have been more affected than others by the pandemic. The DWP, along with other Government Departments, will continue to work in partnership with mayors, local government, businesses and charities, acknowledging their expertise and links with their local labour markets. This includes working closely and at pace with regional partners during the development phase of the Government’s plan for jobs, which builds on and boosts the existing support offered by our Jobcentre Plus network.
The Government oversaw record employment at the beginning of this year, but, even in that buoyant labour market, there were areas of high unemployment, including in Wolverhampton North East. How will my hon. Friend make sure that those people struggling to find work before the pandemic are not forgotten over the difficult months ahead?
Our jobcentres have remained open throughout the pandemic, making more than 250,000 calls a week to claimants to help them look for work, and supporting those vulnerable claimants face to face. This Department meanwhile is doubling the number of work coaches in our jobcentres with the first wave of adverts going live last week. I can confirm that recruitment in my hon. Friend’s constituency is going live next week. Work coaches are indeed at the core of our employment offer, and this new increase will provide all claimants with the tailored local support that they need.
Manchester Airport employs more than 25,000 people on site and supports a further 45,000 jobs across the north-west, including in Cheadle. Owing to the pandemic, many of those jobs have now been lost or are at risk. Can my hon. Friend confirm that she is working with the Department for Transport, Manchester Airport and local authorities to ensure that the right employment support is in place for airport workers and for those ancillary jobs and workers whose livelihoods depend on the airport?
My hon. Friend has just outlined the work that Greater Manchester jobcentre has already done with key partners to ensure that the reach of our rapid response and redundancy service is extensive, fully working and accommodating all those who she outlined need it. We demonstrated the effectiveness of this service during the demise of Thomas Cook and Flybe—when they collapsed—and the evidence is that the DWP is ready to respond and support all those to find new employment and new career opportunities.
Support for Disabled People: Covid-19
My Department has supported disabled customers during the covid outbreak by automatically extending existing personal independence payment awards and new flexible access to work support for people to work from home as well as in the workplace and ensuring that disabled people can access new support, including kickstart.
We are heading into an important 12 months for policy development to help disabled people with the Government’s new national disability strategy. Many charities in my constituency in Beaconsfield and across Bucks are very keen to give feedback to this strategy. Can my hon. Friend reassure the House that he is meeting stakeholders from a diverse range of backgrounds to ensure the development of a disability policy that is inclusive to everyone?
For both the Green Paper and the national strategy for disabled people, we will be making sure that disabled people, disabled organisations and stakeholders are very much at the heart of shaping our future policies and service delivery.
We will be organising national, regional and local-led events and events in conjunction with stakeholders. I know that my hon. Friend is a strong advocate of her disability organisations in her constituency, and I encourage her to encourage them to take part in the coming months.
This Government have spoken a lot about levelling up so that people are equally supported—something that people expect to be delivered. I asked the Minister on 11 May and then on 29 June how the Government were progressing with uplifting legacy benefits. As of February this year, 1.9 million people in Great Britain, many of whom are disabled, are desperate for the Government to sort this. A DWP report states that it would take four to five months to deliver this. We are now four months on. Can the Minister update us on any progress made, specifically on uplifting legacy benefits?
As a Government, we have provided an extra £9.3 billion-worth of support during the covid crisis, which has been very much welcomed. Specifically, in my area of disability, we will see spending increase this year from £19 billion to £20 billion, which is just shy of a 5% increase, and many disabled people will gain from the additional support provided through universal credit, through the increases in the discretionary housing payment, or through the £500 million given to local authorities as a hardship fund based on individual circumstances.
But the UK Government’s decision to exclude people claiming legacy benefits from the £20 per week covid uplift to universal credit, many of whom are sick or disabled people and carers, is surely untenable. Nearly 300,000 people in Scotland are missing out on the £20 per week increase as a result. Does the Minister agree that people on legacy benefits deserve the same amount of support as everybody else; and if he does, will he put his money where his mouth is and push the Chancellor to extend the uplift and make it permanent at the upcoming Budget?
The Government are putting money where their mouth is with the £9.3 billion-worth of support, which is pretty much unprecedented across the world. I would urge all claimants, disabled or not, to talk to their work coaches and review their circumstances to see whether they could be better off moving over to universal credit. But as I set out in the previous answer, there has been a wide range of support, and as a Government we will always target support at those most in need.
Unemployment was little changed over the second quarter, with the latest official Office for National Statistics figures showing unemployment at 1.3 million. This is due to the unprecedented package of support the Chancellor put in place, protecting millions of jobs through the coronavirus job retention scheme and the self-employment income support scheme. We do recognise there are difficult times ahead, but our ambitious £30 billion plan for jobs will support people during the next phase of our recovery, as we build back better and greener.
Unemployment is soaring, uptake in benefits has skyrocketed and marginalised communities are bearing the brunt. Will the Minister urge the Chancellor to extend the job retention scheme to stop this vital safety net being snatched away from those struggling most in Portsmouth?
I thank the hon. Gentleman for raising issues in Portsmouth, where we are actively trying to help people to get back into work and to have the hope the hon. Gentleman mentions. We are currently working with a pop-up business school in his constituency and, coming up, he may be interested to know that in his local jobcentre there is a new mentoring circle with Maritime UK Solent, which up to 20 young people will get a chance to be part of, seeing the different employer pathways that are available in Portsmouth. He will be interested to know that our work coach recruitment to help people back into work is open, and ends on Wednesday, for people locally to apply.
As my hon. Friend the Member for Portsmouth South (Stephen Morgan) just said, we face a tsunami of unemployment over the coming six to eight months, which I think the Minister would accept. Frances O’Grady, the general secretary of the TUC, said this morning that covid will not end at the end of October, so why should the furlough scheme? Business representatives have said that the furlough scheme in other countries, such as Germany and France, is offering a competitive advantage to those economies that we do not. Will the Minister please speak to the Chancellor and look for an extension of the furlough scheme, particularly on some sort of sectoral deal?
I thank the hon. Gentleman for raising the need for local interventions in his constituency. I must say that his local jobcentre is doing fantastic work, particularly working with young people, and already has new dedicated work coaches to help people as they look to get back into work. We have a new virtual jobs board as well, and we are also working on a local place-based plan to help fill roles in sectors which we already could not fill coming into this, particularly in care homes. There are also roles with the DWP, which start next week, for people to apply for. But I do not think that keeping people in suspended animation and not giving them hope for the future is the way forward.
There is no doubt that the unemployment situation, bad as it is, would have been so much worse had it not been for the various schemes the Minister has talked about, which is why it is such a catastrophic error for the Government to end the furlough scheme in October. With that in mind, can the Minister tell us what estimate the Department has made of the level of unemployment this coming Christmas?
That is exactly why we have our plan for jobs—a £30 billion scheme, including £2 billion for the kickstart scheme. I am going to be boring about this, Mr Speaker. There is so much good work going on in the DWP and our JCPs locally to tackle what the hon. Gentleman has spoken about. There was an amazing opportunity just recently in his constituency regarding sector-based work academy programmes, and new virtual jobs fairs for kickstart are coming up in his constituency, as is more recruitment to help people get back into work, which will start near him next week. We are absolutely determined, with our plan for jobs, to see off that tsunami and give people the right skills and opportunities for the future.
Returning to Employment: Covid-19
The furlough scheme, as we have heard, has been a huge success in helping millions of employees to keep their link to their employer, as well as providing other opportunities for people who are self-employed, with support through grants or through the benefit scheme. Our plan for jobs is a cross-Government initiative that will promote employment opportunities for people of all ages. Our local jobcentres are fully reopened, and we will provide additional support to claimants by doubling the number of work coaches. We are also expanding SWAPs, the sector-based work academy programme, and we have launched our ambitious kickstart scheme, which will provide a vital first step on the jobs ladder for many young people.
I am very supportive of the recent action the Government have taken to help young people into work. I have, however, had a number of older constituents contact me, as they have unfortunately lost their jobs because of covid-19. I would therefore be interested to know what steps the Government will take to encourage employers not to overlook the skills and experience that those in their 50s and 60s can bring to the workplace when they are hiring.
My hon. Friend is absolutely right to highlight the value that experience can bring to the workplace and to a potential new employer. The SWAPs programme allows those looking to pivot into new rules to gain experience in that new area, and in the coming months our job-finding support package will draw on private sector expertise to help those who have recently lost their job, while our job entry targeted support scheme—JETS—will provide extra help to individuals who have been unemployed for three months or more and find themselves at risk of long-term unemployment.
The residents of Hastings and Rye are full of potential and talent that needs to be unleashed, but the recent pandemic has put pressure on local jobs. The kickstart scheme is engineered to help people between the ages of 16 and 25 to gain skills and employment. May I ask what my right hon. Friend is doing to help people over the age of 25 to get the skills and training they need?
Our £30 billion plan for jobs will see us support people of all ages in building the skills they may need to return to work. One of the key elements is what we are calling SWAPs—the sector-based work academy programme, which is expanding the opportunities in priority areas such as construction, infrastructure and social care, and which can provide training, work experience and a guaranteed job interview to those people ready to start a job. Of course, older workers will be eligible for this and can gain important new skills to pivot into sectors to secure employment.
I welcome my right hon. Friend’s response. There is no doubt that we must ensure that the younger generation gets the best chance in life post covid-19, but in North Devon we have a slightly older population. Many of my constituents have also lost their jobs and need additional help and support to retrain. Will she assure the House that those who are a little bit older will not be forgotten?
Indeed, and key to identifying those important opportunities and ways to help people over the age of 25 will be our network of empowered work coaches who engage proactively with claimants to help them to identify the options they need to help to build their skills, increase their confidence and return to employment. We are already doubling the number of work coaches, and my hon. Friend will be interested to know that, in North Devon in particular, we have launched a new 14-week IT connect 50-plus programme, an initiative supporting those over the age of 50 to develop digital skills and apply for jobs online.
The Secretary of State said in July that work coaches were the ones who could help to tease out the great skills that people have and what makes a good fit for a new role. She was right, but the pledge she made in July for 4,500 new work coaches to be in post by October has resulted in only 300 being in post to date, as was revealed last week. The crisis has now gone on for six months, and average work coach caseloads are already over 200, so can she tell the House what is going on and why, since April, she has been so slow to act?
The hon. Lady is perhaps far from what is going on. I think she has very recently visited her local jobcentre to discuss this. I want to encourage her by saying that a number of people can be on-boarded into the Department at any one time, given the comprehensive amount of training that is needed to be a work coach. We have also done this in such a way that many existing DWP civil servants can move from being in the service centres in order to get promoted to being a work coach, building on their valuable experience. I can assure her that we are well on track for making sure that we have the right number of work coaches, and indeed replacement decision makers, on the agreed timescale.
Kickstart Scheme: Harlow
Applications only started on 2 September, and already thousands of employers have expressed interest in providing kickstart opportunities for young people. We are working hard to deliver the scheme. We have not yet developed data on the local level, but I am confident that the management information will start to become available so that we can identify right across the country exactly how we are providing support.
I strongly welcome the kickstart scheme and the incentives it gives businesses to employ young people in my constituency of Harlow and across the country. Will my right hon. Friend set out what further action the Department is taking to support skills and apprenticeships so that our town can be part of the apprenticeships and skills nation that we so want to be?
It is important that a wide range of choice is available to young people, in particular, as they set out in their career, so we will be having kickstart but we will also be having aspects of apprenticeships. My right hon. Friend the Secretary of State for Education announced an additional £2,000 of support for each new apprentice hired from the age of 25. In Harlow specifically, our jobcentre has been running virtual academies and designing SWAP—sector-based work academy programme—schemes to support claimants, working with local employers, including the civil service. Additional funding for the National Careers Service will also mean that over a quarter of a million more people will receive individualised advice on training and careers through their local jobcentre.
Employment Support for Young People: Covid-19
As well as the kickstart scheme, I am delighted to be the Minister bringing forward our new youth offer. Focused on those under 25, we are supporting our young people via a structured 13-week programme, rolling out new youth hubs across local communities, and boosting support for young people with our new DWP youth employability work coaches. This offer includes support to get into apprenticeships, traineeships and sector-based work academy programmes.
I thank the Minister for her answer and the whole DWP team for the support they have given my constituents during this exceptional time. In my constituency of Ynys Môn, I am working with M-SParc, Coleg Menai and the Bangor University team to put together an innovative jobs fair. Along with Alison Cork and Lynn McCann, I am putting together a Make It Your Business event to support women entrepreneurs. How is the Minister supporting innovation and entrepreneurs?
Supporting the self-employed and inspiring entrepreneurship is a real focus for me as the Employment Minister. I had the pleasure of visiting north Wales not that long ago, back in January, and not too far from my hon. Friend’s beautiful constituency of Ynys Môn, where I met a lady who had started her own innovative charity supporting other young women to succeed and thrive in the way that my hon. Friend has described. I want everyone to have the same opportunities to build their own business. The DWP’s new enterprise allowance scheme is open to claimants to support new and existing businesses to grow and thrive.
The local DWP team in my Workington constituency, who I met on Friday, have worked incredibly hard throughout this pandemic to ensure that claims are being managed in a timely and efficient manner despite the huge increase in their workload. Will my hon. Friend join me in paying tribute to them as they enter the next phase of their plans to tackle youth unemployment and under-employment?
I join my hon. Friend in his thanks to all our DWP staff who have worked so extremely hard during the pandemic. The DWP is supporting all claimants in focusing on getting back into work. The jobcentre in his constituency is playing a vital role in his community through key outreach, including the Maryport GP surgery. Our work coaches are based in that surgery every Tuesday, taking referrals to deliver work advice to patients and ensuring that everyone gets tailored support.
Support for Shielding People: Covid-19
Those in a local lockdown area who receive a notification that they need to shield will remain eligible for statutory sick pay and new-style employment and support allowance, subject to the wider eligibility criteria.
Clearly local lockdowns will present local challenges, and we would expect most employers to be responsible, but will the Government offer support to employees to hold their employers to account where they are not following the guidelines and making their workplaces covid-secure?
The Government, through the Health and Safety Executive and the Department for Business, Energy and Industrial Strategy, are continuing to issue improved guidance to make it as easy as possible for employers to make reasonable adjustments. Those employees who still have concerns can either talk directly to their employers or raise them with the Advisory, Conciliation and Arbitration Service or the HSE to try to get them resolved. I think most employers want to do the right thing, and we are doing everything we can to give them as much help as possible to get it right and make their workplace covid-safe.
Last week, the TUC made it clear that two fifths of workers will be unable to pay bills if they have to self-isolate for two weeks. Statutory sick pay will have to go up for test and trace to work. Will the Secretary of State increase statutory sick pay to ensure that no one is left behind and keep the country covid-secure?
We have already made changes to the eligibility for statutory sick pay so that people can qualify from the first day rather than wait until the fourth day. We have extended it to those with symptoms, those who need to self-isolate, or those who need to self-isolate ahead of a hospital procedure. Those on low incomes also have the opportunity, subject to their personal circumstances, to get additional financial support through either universal credit or new-style ESA.
Universal Credit: Bonuses
Bonuses are earnings and are treated in the same way as any other earnings in calculating universal credit awards, reflecting HMRC guidance and ensuring fairness across the working population, many of whom do not claim welfare. UC is more generous than the legacy benefits that it replaces. The Government have already made significant investment to increase universal credit’s generosity by cutting the taper rate to 63% in 2017, with an extra £1.7 billion a year put into work allowances by 2023-24.
My constituent, a key worker in a pharmacy, received a one-off bonus of £120 for her efforts supporting vulnerable people during the coronavirus pandemic. That reward for hard work was eroded when £172.69 was subsequently deducted from her monthly universal credit payments. Does the Minister agree that that is no way to treat people who have stepped up to support us all during these difficult times? Will he consider temporary changes to the work allowances and taper rate to enable key workers to receive these bonuses in full?
I want to thank all the key workers across our country who have done so much during the pandemic. Universal credit makes sure that people are always better off in work. Under the legacy benefits system, claimants would not have kept all their bonuses; in fact, in many cases, the legacy withdrawal rate could be as high as 91% for each additional £1 earned, compared with a maximum of 75% under universal credit.
Kickstart Scheme: Young People
My Department is working closely across Government to encourage all employers, big and small, to apply for the kickstart scheme. I urge all colleagues to work with their local jobcentre networks to help us to deliver this.
The six-month job placement created by the kickstart scheme will be a vital way in which we can help young people in Ipswich to get on the careers ladder during the current challenges. Will the Minister also place a high priority on the excellent wellbeing and skills programmes run by charities such as Inspire Suffolk in my constituency, which are setting young people up with exactly the kind of support network and knowledge that they need at a vital time in their lives?
I thank my hon. Friend for raising the scheme, which is really positive news for his constituency, adding to much similar work across his constituency. Our work coach recruitment is now open in Ipswich and we are looking at a potential youth hub locally, so there is good news in Ipswich. Locally, we are also working with the employers Seven and Service Central, which are working together, hopefully to find some key roles for their young customers in kickstart. We are also working with the East Anglian gymnastics team on a potential new apprenticeship position, so there is plenty of good news in Ipswich.
I warmly welcome the kickstart scheme, which is a vital step to ensuring the future prosperity of so many young people across our country. In Buckinghamshire, organisations such as Buckinghamshire Business First are helping to co-ordinate firms that cannot offer as many as 30 places. What steps is my hon. Friend taking at national level to ensure that small rural businesses are able fully to participate?
I am delighted with the interest in the kickstart scheme across the country, including in rural areas, and including smaller companies in that is key. We want applicants from across the country to benefit by bidding for those placements , perhaps via an intermediary or gateway organisation. Small employers, whether rural or not, will have the key support they need from that intermediary, and that will help to create high-quality roles and provide additional support, so that all our young people get the most out of this placement.
From the jobs plan I know that my hon. Friend is determined to do what it takes to help young people find access to the work that is so vital to their futures. What other support is available, in addition to the kickstart scheme, that will help young people in Basildon and Thurrock to recover from the effects of the pandemic and secure future opportunities?
My hon. Friend is exactly right, and we are rolling out youth hubs across the country so that our young people can access that important wider support. Those hubs will be co-located and co-delivered with our network of external partners, including members of the youth employment group. Our jobcentres are already delivering activities at local level to support our young people, including mentoring circles, virtual job fairs and sector-based work academy programmes.
Adequacy of Benefits
The Government introduced a package of welfare measures worth more than £9.3 billion this year, to help those facing the most financial disruption during the pandemic. We introduced a series of measures to support people, including an increase in the universal credit standard allowance for 12 months, worth up to £1,040. Increased local housing allowance rates have put an average of £600 into people’s pockets, and we made statutory sick pay available to employees from day one.
I thank the Minister for his answer, but ending the £20 universal credit uplift could see food bank use increase by 10%, according to the Trussell Trust, and the Joseph Rowntree Foundation has warned that 16 million people could lose £1,000 a year overnight, plunging 700,000 more people into poverty. Will the Government remove that cliff edge and make the £20 uplift to universal credit permanent?
The increase was introduced for an initial period of one year as part of the Government’s measures to assist with the financial consequences of covid-19. It was part of a £9.3 billion increase to the welfare system that ensured that it was able to stand up and support the millions of extra people who needed it. Future decisions on benefit rates will be made at the appropriate fiscal event.
Universal Credit: Covid-19 Income Support Schemes
Since mid-March we have received more than 3 million claims for universal credit, ensuring that people have a welfare safety net in their time of need. I am proud that more than 90% of new eligible claimants were paid in full and on time, proving that universal credit can stand up to the challenge. The Government’s support for people and businesses is not ending, and we are now focused on delivering our plan for jobs. I hope that the hon. Lady will support that plan, particularly the new £2 billion kickstart scheme that will create hundreds of thousands of new, fully subsidised jobs for young people across our country.
I appreciate the Minister’s response, but with coronavirus support schemes being wound down and the Government seemingly unwilling to contemplate their extension, what actual steps is the Minister taking to ensure that towns such as Rotherham are not faced with a generation of mass unemployment, empty shops and closed factories as a result of the pandemic?
The hon. Lady is right to say that the coronavirus job retention scheme has been a huge success—it has protected up to 10 million jobs—but it is important to point out that support for furloughed employees does not end in October. In the Chancellor’s summer statement, he announced the new job retention bonus, which will pay employers £1,000 for every employee still in post by the end of January. For those who, sadly, are made redundant or lose their jobs, Jobcentre Plus stands ready to assist up and down the country.
Employment Opportunities: Post Lockdown
I met the Mayor of London and some of his team as part of the M9 Group engagement with key stakeholders and other Government Departments on the importance of local recovery plans and action. We now have 890,000 more people claiming universal credit in London. The Mayor of London needs to work with local DWP teams to drive that number down and help build a strong recovery for our economy.
My constituency is part of Greater London and I have met many businesses in Carshalton and Wallington that are keen to expand employment opportunities, including Dotty’s Teahouse in Carshalton High Street, which I would love to invite the Minister to. Given London’s critical role as the engine of the UK economy, does the Minister agree that the Mayor needs to step up, show more leadership and do more to encourage employment opportunities, not just in my constituency but across the capital?
I thank my hon. Friend for raising that point about the critical role in turning London around. Dotty’s Teahouse sounds like a really lovely place to pop down to, to see whether they have any gluten-free cake.
The pandemic has changed the labour market landscape and it is absolutely right that the Mayor of London steps up and delivers on behalf of London, otherwise as we know, someone else is waiting in the wings to do it.
It has been less than two weeks since the Government launched the kickstart scheme, which will help thousands of young people on to a vital step on the jobs ladder. Thousands of employers have already expressed an interest and I am pleased that several have already had funding approved. Smaller organisations that do not expect to take on more than 30 kickstarters during the scheme will gain access to funding through an intermediary. I know that several organisations are applying to that gateway, for example Suffolk County Council and Suffolk chamber of commerce. We are having productive discussions with the Federation of Small Businesses, which very much wants to be part of the solution for small businesses and young people.
This is a Great Britain-wide £30 billion plan for jobs. I know that the Scottish Government are undertaking their own initiatives, but I am sure that my hon. Friend will want to ensure that we put the full efforts of the UK Government into helping people in Scotland get back into work.
I thank my right hon. Friend for that answer. What steps is the Department taking to ensure that young people in Scotland are not disproportionately affected by the economic fall-out from covid-19, given that we were suffering from a higher rate of unemployment when the pandemic hit?
My hon. Friend is right to point out that Scotland was already starting to struggle with unemployment rates compared with other parts of the United Kingdom, but I want to assure him that we will not only work with kickstart, but ensure that we have a Scotland-specific job entry: targeted support—JETS—programme so that we can tackle people who perhaps need either support to pivot into different sectors, or intense support which recognises that they may have been unemployed for some time. We will ensure that the people of Scotland get the full support of the UK Government.
It is a tragic consequence of the pandemic that some families of NHS key workers have lost their loved ones to covid-19 after they contracted the virus while serving on the frontline. It is absolutely right that they receive compensation for that. May I ask the Secretary of State to justify the news that low-paid relatives who receive the compensation payment are to be stripped of their benefits? That is not the case with comparable payments such as the Grenfell and Windrush compensation schemes, so why are NHS families being treated in that way?
The hon. Gentleman will know that when people have a substantial amount of money—and I recognise the route he indicated on how they have received that—it usually takes them over the £16,000 threshold for support through the welfare system. He specifically referred to some other programmes, where it is absolutely acknowledged that there has been a complete failure within Government in that regard. I suggest to the hon. Gentleman that that is not the case regarding the NHS, but I am sure, as the NHS is a separate employer from the Government, it will continue to work with its employees and the relatives of people who have sadly died.
I find that answer lacking in reason and compassion. There was news this morning that the country’s largest food bank network has warned that UK destitution rates are set to double by Christmas. We know that the Government believe they deserve praise for the fact that universal credit has not collapsed like the test and trace system, but the real test of a social security system is whether it gives people the support they need. The food bank statistics prove that this is just not happening at the moment. Clearly that will get worse as the furlough scheme ends. We have set out our further suggestions on how to prevent the looming disaster. What are the Government’s plans to prevent it?
We have set out the unprecedented steps we took to ensure that vulnerable people would not go hungry as a result of the pandemic, focusing especially on children. While schools were closed to most children, free school meal vouchers were still in operation if schools could not provide a meal. Further support was given through the summer food fund, money was provided to food charities to help get food to people who were struggling, and 4.5 million food boxes were given to vulnerable people who were shielding. Together with the extra £9.3 billion in welfare support that has been given to households across the country, we believe that this is a strong way to have supported people in these difficult times.
First, no one will get away with giving false information. Those who are found to have been abusing the system are subject to the full extent of our enforcement powers. The Child Maintenance Service will pursue those people where appropriate. Parents were asked to report any changes via the self-service portal to ensure that receiving parents did not lose out in the long run. Cases will be updated and people will be notified of any changes. Where payments have been missed, the service will take action to re-establish compliance and collect any unpaid amounts that have accrued.
The National Audit Office told the Work and Pensions Committee two weeks ago that the “sophisticated” analysis of the Trussell Trust has established an association between universal credit roll-out on the one hand and rising food bank demand on the other. Association is not the same as causation, so what plans do the Government have to commission research, as the National Audit Office recommends, into the impact of universal credit on food bank demand?
I thank the Chairman of the Select Committee for his question. As he knows, I gave evidence to the Committee recently on this very matter. I have worked closely with food bank providers—the Trussell Trust and others—over the course of the pandemic to ensure that our support has got to those who need it quickly. We continue to better understand the reasons for food insecurity. That is why we have put additional questions in the family resources survey. We keep all policies under review, and of course we listen to the findings of reports such as that of the Trussell Trust.
My hon. Friend is absolutely right. We are investing £10 million of European social fund support to get 20,000 disadvantaged people across England who are without access to the internet online. People who receive ESF support will be loaned devices, such as a tablet or a laptop, and be provided with three months’ data allowance. That will enable them to access the increasing range of online services to support their job search and, importantly, their journey towards securing employment.
First, let us remind ourselves of where we were in January. We entered the pandemic with employment at a record high of 33 million.
It is on my list to visit: we will be up there to see what the local jobcentre is doing. We have an ambitious plan for jobs—£30 billion in the next phase of our recovery—to ensure we build back better, greener and stronger. Extending the furlough scheme will just keep people in suspended animation. I am absolutely determined to use my role to get back to where we were in January.
I could not be more excited about what we are doing near my hon. Friend’s constituency, which is a key local example of cross-Government and local partnership. We have an innovative and unique scheme, with the DWP, the Department for Transport and the Department for Education. Where people are being made redundant from the aviation industry or its supply chain, they will be able to pivot across to the film industry, bringing their skills to a growing and booming industry. That will be facilitated by our flexible support fund grant and involves key local partners, including Pinewood Studios, ScreenSkills, and the excellent Buckinghamshire local enterprise partnership and the M3 enterprise LEP.
We have had unprecedented Government intervention since we headed into the coronavirus crisis. Last week, I met G20 Ministers looking to learn from what we have done in the UK and, above all, learn about our next stage, which is our plan for jobs and the forthcoming £2 billion kickstart scheme. This is about moving forward, not holding people back or in suspended animation.
My hon. Friend asks an important question about our work with the business community and across the Government. The DWP has been an integral player in the development of the plan for jobs. Together with my right hon. Friends the Secretaries of State for BEIS and for Education, we have had several roundtables with the business community and others to ensure that people who are looking to enter employment can develop skills and have additional funding, going down the apprenticeship or traineeship route, as well as kickstart. I am also in regular discussions with other Cabinet colleagues on the creation of new opportunities wherever possible.
I thank the hon. Lady for her question. The Department has an ongoing positive relationship with a range of food bank providers. It has regularly engaged with them throughout the coronavirus pandemic and will continue to do so. We quickly introduced welfare changes worth an additional £9.3 billion, and worked closely with other Government Departments on the cross-Government taskforce on food and other essential supplies. Further to my earlier answer, the hon. Lady will have to wait for future fiscal events where benefit rates are set.
My hon. Friend rightly pays tribute to the incredible team at Harrogate Jobcentre Plus. As he knows, we have seen a surge of over 3 million claims since mid-March, and I agree that UC has stood up to the challenge, with payment timeliness remaining high at over 90%. We will continue to closely monitor our services across the country and will continue to keep staff numbers under review. As he also knows, we have committed to doubling the number of work coaches.
As a Government, we absolutely recognise the support that carers provide. We have made a number of changes during covid-19 to maintain that support, including allowing emotional support and allowing for breaks due to covid. By 2024-25, we expect to be spending £3.6 billion supporting carers, which will be more than double that spent when we first came to office.
I thank my hon. Friend for raising kickstart. This is a huge programme for young people, providing 25 hours a week and an opportunity to get their first foot on the employment ladder. We do not want our young people to be left behind because of the impact of the pandemic—we know that the scarring can affect them most. Kickstart will change that, and I ask all employers to get involved and be part of it.
We rightly took a decision to suspend face-to-face assessments following Public Health England’s guidance. We continue to keep this under review, but wherever possible, we are either doing a paper-based review or a telephone assessment, and we are automatically renewing reassessments that are due within three months by six months, and we review that on a regular basis.
I go back to our £30 billion plan for jobs. We have to move forward, absolutely understanding what we learned coming into this pandemic—that we have the highest employment rate going. Going back to square one for some of these people is a real challenge. That is why we have stopped the minimum income floor for people who are self-employed and we are supporting people to get back into work. I understand what the hon. Gentleman is asking, but we need to focus on the plan for jobs —a £30 billion scheme, with interventions coming down the line. We need to move forward and give people hope.
Japan Free Trade Agreement
I am delighted to announce that last Friday we reached agreement in principle on a free trade deal with Japan. The UK-Japan comprehensive economic partnership agreement is a major moment in our national history. It shows that economic powerhouses, such as Japan, want ambitious deals with the United Kingdom, and it shows that the UK can succeed as an independent trading nation. It shows that we can strike deals that go further and faster than the EU—British-shaped deals that suit our economy.
This deal will drive economic growth and help level up our United Kingdom. On tech, it goes far beyond the EU-Japan deal, banning data localisation and providing for the free flow of data and net neutrality, benefiting our leading tech firms. In services, we have secured improved market access for financial services and better business mobility arrangements for professionals and their families. On food and drink, up to 70 of our brilliant British products can now be recognised in Japan, from Welsh lamb to Yorkshire Wensleydale cheese, English sparkling wine and Stornoway black pudding. Under the EU deal, that was limited to just seven. We have also secured tariff reductions on British goods from biscuits to pork, as well as continued access for malt and Stilton cheese.
In manufacturing, lower tariffs on parts and improved regulatory arrangements will benefit major employers such as Nissan and Hitachi in the north-east. The deal strengthens our ties with the world’s third-largest economy and deepens the bond between two like-minded island nations who believe in free and fair trade.
One of our greatest Prime Ministers, Mrs Thatcher, saw the value of co-operating with Japan in areas such as the automotive sector and electronics in the 1980s, which attracted the likes of Nissan and Toyota to our shores and delivered lasting benefits. Now, in 2020, we will unleash a new era of mutually beneficial economic co-operation with our great friend Japan, pushing new frontiers in areas such as tech and services trade. Japan, as one of the world’s major economies, is a vital partner for the UK and one of the most significant nations in the Pacific region. Securing this Japan deal is a key stepping stone towards joining the trans-Pacific partnership, which is one of the world’s largest free trade areas, covering 13% of the global economy and £110 billion-worth of trade. Accession is vital to our future interests. It will put us in a stronger position to reshape global rules alongside like-minded allies. It will hitch us to one of the fastest growing parts of the world. It will strengthen the global consensus for free trade at a time of global uncertainty and creeping protectionism. Japan, alongside this agreement, has given its strong commitment for UK accession to the comprehensive and progressive agreement for trans-Pacific partnership, and last week I co-chaired a chief negotiators’ meeting of all 11 TPP countries—the first time that a non-member state has been asked to do this—where we discussed the path to UK membership. As negotiations progress, we will bring forward the formal application process to Parliament, and ensure that it is scrutinised openly and transparently.
As I have promised, there will be a full scrutiny process for the Japan deal and all the other agreements that we strike. Prior to entering negotiations, we issued a scoping assessment and published our objectives. During the negotiations, we have engaged extensively with business and stakeholders, including sharing sensitive tariff and market access information with our new trade advisory groups. We have established a Trade and Agriculture Commission to put our farmers at the heart of trade policy and ensure that their interests are advanced. When it is complete, I will be issuing a copy of the final deal to the International Trade Committee for scrutiny. We will also produce an independently scrutinised impact assessment, covering social, labour, environmental and animal welfare aspects of the agreement so that parliamentarians are able to interrogate the deal and prepare a report that is debated in Parliament. Ultimately, Parliament will decide whether to ratify the deal through the Constitutional Reform and Governance Act process or to withhold its support.
I am strongly of the view that this is a great deal for Britain. It benefits all parts of our country while protecting our red lines on areas such as the NHS and food standards. The agreement that we lay before Parliament will be the first of many, because there is a huge appetite to do business with global Britain and a huge opportunity for every part of this country to benefit from these agreements. This deal is a sign and a signal that we are back as an independent trading nation, back as a major force in global trade and back as a country that stands up for free enterprise across the world. This is just the start for global Britain.
I thank the Secretary of State for advance sight of her statement and congratulate her on reaching this agreement. It is a much-needed relief for all those UK companies that would have seen their trade with Japan revert to World Trade Organisation terms if the agreement had not been reached by the end of the year. It is also a welcome benefit at a time of great economic uncertainty for the UK’s digital and tech sectors, and for other key exporters, which will benefit from greater access, faster tariff reductions or stronger geographical indication protections under this agreement than they enjoyed under the previous EU-Japan agreement. In the absence of a treaty text and a full updated impact assessment, there is much about the UK-Japan agreement that we still do not know and will not know until those documents are published. Nevertheless, I hope that the Secretary of State can answer some initial questions today.
First and foremost, will the Secretary of State tell us, in billions of pounds and percentages of growth, what benefits this agreement will produce for UK trade and GDP over and above the forecast benefits of simply rolling over the existing EU-Japan deal? I was glad to hear her refer to consultation with the farming sector. Can she tell us what benefits the sector will derive from this deal if the EU reaches its tariff rate quota limit for agricultural products, and how that will compare with the benefits that the sector was forecast to derive from the EU-Japan deal? Will she also tell us what the impact of Friday’s agreement will be on the UK aerospace sector relative to the impact of the EU-Japan deal?
Let me turn to three specific issues. Given that there has been lots of discussion about Stilton, can the Secretary of State tell us exactly how the treatment of Stilton differs under the deal that she has agreed compared with its existing treatment under the EU-Japan deal? Given the current debate on state aid, can she confirm that the provisions on Government subsidies that she has agreed with Japan are more restrictive than the provisions in the EU-Canada deal, which No. 10 has said is the maximum it is prepared to accept in any UK trade deal with Brussels? On a similar subject, what provisions, if any, are included in the UK-Japan agreement relating to public procurement, and are they also consistent with the Government’s current negotiating position on an EU trade deal?
On the subject of Brexit, will the Secretary of State simply agree with me that, as welcome and necessary as this deal with Japan is, it is nothing like as important in terms of our global trade as reaching a deal to maintain free trade with the European Union? Our trade with Japan is worth 2.2% of our current global trade. That does not come anywhere near the 47% of trade that we have with Europe under the Government’s best-case scenario. The deal they signed on Friday will increase our trade with Japan by a little less than half in 15 years’ time. That is nothing compared with what we will lose in just four months if we do not get the deal with Europe that this Government have promised. That is why Nissan and every other Japanese company operating in Britain have told us that the deal that will determine the future of the investment and the jobs that they bring to our communities is not the one that we signed with Japan, but the one we sign with Europe.
I am glad that the Secretary of State has committed to a further debate on the agreement, given that there are many more questions to ask, but frankly there is no point in having that debate if Parliament does not have the right to vote. Will the Secretary of State guarantee today that once the treaty text and all the impact assessments have been published for proper scrutiny, she will bring the agreement back for a debate and vote, in Government time, just as will be done in the Japanese Parliament? It surely cannot be the case that this House will have less of a right to vote on a self-proclaimed historic deal agreed by the Secretary of State than will be enjoyed by our counterparts in Japan. May I ask her today to guarantee a vote, and to make it a precedent that will apply to all the other historic agreements she mentioned in her statement and that we hope are still to come?
After the right hon. Lady’s congratulations to me on securing this important deal, it is perhaps a bit churlish of me to point out that she did not vote for the original EU-Japan deal, so none of the original benefits she talked about would have come into existence had we followed the steer given by the Labour party at the time. The deal we have secured goes significantly beyond the EU-Japan deal in areas that are important to the United Kingdom. For example, the data and digital chapter in some cases goes beyond the CPTPP and sets new precedents for a high-quality deal. On business mobility, financial services, geographical indicators and rules of origin, there are advances in all parts of the negotiation that benefit all parts of the UK and all parts of business.
The right hon. Lady asked about the impact assessment. No doubt she has read the scoping study, which shows a £15 billion increase in trade under this deal, but of course we will conduct another impact assessment following the finalisation of the details of the deal, which we will indeed publish. It will also cover the deal’s environmental impact, social impact and impact on agriculture. [Interruption.] From a sedentary position, the hon. Member for Harrow West (Gareth Thomas) asks when we will publish it. The answer is that we will do so when we have completed the full legal scrub of the documents and signed the agreement.
The right hon. Lady asked me about agriculture. I am pleased to hear that she shares my strong interest in improving exports of Great British products around the world. The vast majority of agricultural products such as beef and pork are not subject to tariff rate quotas, and we have secured the full liberalisation of those products under this agreement, which is a tremendous boost for British farmers. There is a limited number of areas where there are tariff rate quotas, and that represents about £1 million worth of business versus just over £150 million for the remainder of agriculture, but in those areas we have fought hard to ensure that British exporters continue to get the benefit of exports into the Japanese market at lower tariff rates, including but not limited to Stilton. We have also secured an agreement on malt barley, and we are the second largest exporter of malt into Japan, so that is a significant benefit for British farmers. We have also succeeded in getting more liberal rules of origin on many food and drink products, which will mean that more producers are able to export into Japan tariff-free.
As the right hon. Lady knows, under the Constitutional Reform and Governance Act 2010, Parliament can refuse to ratify trade deals. Parliament has the power that other Parliaments have. If there is not a majority in this House for this trade deal, which I do not think will be true because it sounds like she has changed her mind since she voted against the Japan deal last time, it will simply not be ratified.
The right hon. Lady asked me all kinds of questions about the details of the agreement. Obviously, as we, first of all, share it with the International Trade Committee and then with Parliament, she will be able to see the details, but I assure her that the subsidies chapter is the standard kind of chapter you get in an FTA. It is vastly different from what the EU is trying to do with us, which is essentially impose the EU state aid regime in Britain. As David Frost has made clear, that is simply not acceptable.
The right hon. Lady tries to compare and contrast the EU and Japan. We can have both deals—we are global Britain. We want to have deals with CPTPP, with the United States, with the EU and with Canada, and I believe that that is absolutely possible. I am afraid to say that the right hon. Lady still seems to want to relitigate the EU referendum. In 2016, the people of Britain decided. It is time for her to get behind it.
I congratulate the Secretary of State on this heroic and historic new trade deal, and on proving the doubters wrong yet again. Under the EU-Japan deal, there were just seven geographical indicators. Under this new agreement, she has managed to potentially secure another 70, including west country lamb and west country beef. Can she outline how the new deal will benefit beef, lamb and dairy farmers in my constituency?
I thank my hon. Friend for his question. I am looking forward to visiting Davidstow, which is one of the major cheese exporters from the United Kingdom, this Friday. The answer is that dairy products, such as cheddar from Davidstow, will go down to a zero tariff over time as a result of the agreement. We are protecting new product names, whether it is Cornish pasties or clotted cream. We will also see reductions in tariffs for fantastic products such as beef, also from Cornwall.
I congratulate the Secretary of State. I recognise that, although this deal shares many similarities with the EU deal, it goes slightly further in a limited number of areas, not least the geographic indicators. It would be interesting, however, to find out just how many the UK pushed for as part of the EU deal. On the vexed issue of cheese, which is barely mentioned, surprisingly, it would appear from the reading today that all UK manufacturers can do is fulfil unused EU quotas. I welcome what she has said on data, and what has been described as the digital trade chapter is real progress; however, she will want to confirm that, even with that, if all goes according to plan in GDP terms this deal will be worth less than one tenth of 1% of UK GDP—barely denting the losses anticipated from Brexit.
The elephant in the room is the UK’s stated intention to breach international law and to break legally binding treaties. That is important because the Japan deal is primarily significant in paving the way for CPTPP accession. We know the attitude of the United States—that there will be no deal if the UK breaches international law—and the approach of many of our potential CPTPP partners is very similar. Australia, for example, has demonstrated consistent support for a far-reaching system of international law, and has made a valuable contribution towards realising that. It is a country committed to a rules-based international system. This is all about trust, so would it not have been better for winning the big prize of CPTPP accession if the Secretary of State had stood up and announced the withdrawal of the internal market Bill, rather than boasting about very small gains in this Japan deal?
Only the SNP could say that £15 billion of extra trade is insignificant, but this Japan deal is not just important economically in itself; it is important, as the hon. Gentleman mentioned, for accession to TPP, a trade area worth £110 billion. That is vital. This is a step forward. One of the key things we have secured is strong agreement from the Japanese to help us accede to TPP.
I hope that the hon. Gentleman is also pleased by the extra protection we have secured for Scotch whisky. There have been issues in Japan, and the Japanese Government have agreed to work with us and the industry on the development of enforcement mechanisms for lot codes on wines and spirits, meaning that Scotch whisky will be even better protected in the Japan market.
The hon. Gentleman talked about cheese. The vast majority of the cheese we export is not subject to quotas. Thanks to this deal, as I mentioned to my hon. Friend the Member for North Cornwall (Scott Mann), the tariffs on our cheese will go down to zero over time, which will be of huge benefit to Scottish cheddar producers.
I congratulate my right hon. Friend on achieving this agreement. Free trade, of course, is the key to prosperity for all our constituencies, and it is particularly important and valuable for mine, with the largest port in the country at Immingham. I particularly welcome the mention of the trans-Pacific agreement. Will she outline how she will continue with that agreement and move forward with agreements with countries such as Australia?
We are the first potential accession country that has had a meeting with all 11 chief negotiators. We will now go into separate discussions with those countries to prepare our accession plans. I hope to be able to formally apply early next year so that we can make progress and accede to this high-standards agreement, which will give British exporters access to the fast-growing Pacific market.
Tapadh leibh; feasgar math, Mr Speaker. First, the Secretary of State made very welcome mention indeed of Stornoway black pudding. She then went on to say that she is delighted about the deal, described it as a major moment and said that she feels this UK-Japan FTA is ambitious. However, the GDP figures show it is worth a seventieth of the deal with the EU—a seventieth of the cost of Brexit—so is getting a deal with the EU not 70 times more important than this admittedly very welcome UK-Japan comprehensive economic partnership agreement? Will the Secretary of State also clarify whether any of this is dependent on EU co-operation or deals, especially on cumulation?
I am pleased to hear the hon. Gentleman’s welcoming the increased protection for Stornoway black pudding in the Japan market. He will note that a number of other indicators have been given access to that market, which is important. There are also, of course, huge benefits for Scottish lamb and beef farmers in terms of reduction in their tariffs.
On the hon. Gentleman’s point about the EU, this is not an either/or choice. Global Britain wants to have a good trading relationship with the EU and a good trading relationship with Japan and CPTPP. That is all possible, but what it will take is for the EU to give us a deal in the way that it has given Canada a deal.
Once the details of this trade deal are published, the Japanese Parliament will get the opportunity to debate and vote on it. Will the Secretary of State be clear about whether parliamentarians in both Houses of this Parliament will get the same rights as our Japanese colleagues?
Once we have the fully legally scrubbed deal, that will go to the International Trade Committee on a confidential basis for that Committee to analyse it. We will also undertake independent analysis on the key points that I outlined earlier—the environmental impact, the social impact and the impact on animal welfare standards. That will then be debated by Parliament and, through the CRaG process, if Parliament is not happy, it will be able to not ratify the deal. I do not think that will be the eventuality, however, because I think people will recognise that the deal is of benefit to the UK economy.
From what I have seen of the deal so far, it is a great deal and the Secretary of State is to be congratulated on securing it. Coming out of Brexit, it will do much. However, I note that the deal now goes to the Japanese Parliament, as has been said, for pre-signing approval, but not by law to this Parliament for pre-signing approval. Will my right hon. Friend acknowledge—preferably in the Trade Bill, which is going through the other place—that, post Brexit, the UK needs a modern, relevant, fair and workable scrutiny regime for new FTAs and not just a return to the pre-EU, outdated 1924 Ponsonby rule, which is restricted to ratification?
I understand that the deal will go to both Parliaments at the same time—it will go to the Japanese Diet at the same time as it goes to the International Trade Committee in this House for its analysis. As I have said, under the CRaG process, which was introduced by the Labour Government in 2010, Parliament can block the deal if it does not like it, and that process is roughly equivalent to those in other Parliaments, including in Canada, Australia and New Zealand.
I note what the Secretary of State said about impact assessments, but what discussions has she had with the Office for Budget Responsibility about whether it will produce a forecast of the impact of the deal, specifically comparing it with WTO trading conditions and what would have happened if we had just rolled over the EU-Japan deal?
I am committed to making sure that we have independently audited analysis of the deal that we complete, but the hon. Lady has highlighted a hypothetical situation. We are now in a world where we have left the EU, even though some Opposition Members do not seem to want to acknowledge that. What we have to talk about is the benefits of signing the deal versus not signing it.
I warmly welcome my right hon. Friend’s statement and congratulate her on this agreement, which is really good news. Can she explain how small and medium-sized enterprises, which are the backbone of our British economy, will benefit from this excellent deal?
The deal with Japan has a dedicated SME chapter, which is all about reducing the red tape that SMEs face, making it easier for UK and Japanese SMEs to understand the others’ markets and providing information to make it easier for them to export and gain the benefits of international trade.
I thank the Secretary of State for prior sight of her statement. Yes, we also welcome the trade deal, but I have two serious concerns. First, it seems to simply mirror what we have with the EU, and, apart from symbolic wins on things such as Stilton cheese, the Government have failed to leverage any real, meaningful benefits. Also, given that the deal has stricter state aid regulations than the disputed ones in the EU proposals, do the Government actually have a trade strategy?
I urge the hon. Lady to look beyond the EU—90% of global growth is coming from beyond the EU. Both Japan and the wider Pacific region, which is a fast-growing area, are vital for Britain’s future economy. Of course we want a deal with the EU, but that should not stop us doing advantageous deals with fast-growing parts of the world and working with allies to put forward the cause of free and fair trade.
I, too, congratulate my right hon. Friend on this trade deal. Can she say a little more about how the south-east will benefit from this? It is not just financial services there. She will be aware that the increase in both exports and imports over recent years has been in road transport.
We have achieved improvements in areas such as transportation services as well as financial services in the trade deal. We have also improved professional and business mobility, making it easier for business people to travel between Japan and the United Kingdom and increasing our economic links. That will be particularly helpful for the south-east of England.
I of course congratulate the Secretary of State on any trade deal, but she has done a deal with Japan, which represents 2% of our trade, in a week when we have probably lost the 15.5% deal we might have had with the United States. On the day when a Japanese company, SoftBank, has sold off one of the jewels in the crown of British technology, is it not shameful that she could not bring herself to mention Arm from Cambridge? Will the people of this country not despair at her not mentioning that?
That was a typically upbeat question from the hon. Gentleman. It is not true that our deal with the United States is not progressing; on the contrary, we are in the middle of a very positive negotiating round in which we are currently discussing market access terms.
I congratulate the Secretary of State on securing this deal. I am delighted, as the people of Cornwall will be, that the iconic Cornish pasty and Cornish clotted cream are to be protected, along with many other geographically protected British products. Can she say what further opportunities there will be for Cornish producers to export to Japan as a result of this deal?
My hon. Friend is right: a number of products in Cornwall—whether the Cornish pasty, west country farmhouse cheddar or clotted cream—will benefit from this deal through not only lower tariffs but increased recognition of their geographic indicators. I will be in Cornwall later this week, and I hope to talk to producers about how we can increase their exports and take advantage of these new opportunities.
I find it absurd that the House is being asked to debate a text that has not been published, because with trade deals, the devil is in the detail. I want to pick up on the point about state aid provisions, because I am curious about this. In today’s Financial Times, it is reported that the UK and Japan
“have agreed to replicate the restrictions on subsidies in the EU-Japan deal that went into effect last year.”
I was involved in that in Brussels, in a previous incarnation, and it goes far beyond what the UK is looking for in the UK-EU trade deal. I listened carefully to the Secretary of State’s response, and she said that it is a “standard” state aid clause, which strikes me as bizarre language, because there are no standard state aid clauses in any trade deals ever anywhere. Has she made the commitment reported in the Financial Times? Will she stand by it, will she resile from it in six months’ time in a limited way or has she dropped the ball?
I find it extraordinary, when I am appearing in front of the House to update it, for the hon. Gentleman to complain that I have not given the next update. I am here because, every stage that we agree with the Japanese, I want to share it with the House and have that debate. Of course there will be another debate when we have produced the final text, which he will be able to participate in. Many FTAs have subsidy clauses, but no FTA, apart from the one that the EU is demanding with the UK, has one bloc imposing its subsidy regime on another country.
By now, the whole House will know of my love of the autonomous delivery robots in Milton Keynes. I am assured that they can deliver geographically protected goods such as Stilton and pork pies, but they are also part of the UK’s larger tech industry. Will my right hon. Friend update the House on how our tech businesses will be helped by the data and digital parts of the deal?
The deal will, in essence, underwrite digital and data flows between the UK and Japan, so there will be no requirements such as data localisation and we will uphold the principles of net neutrality and enable the free flow of data. It will mean that brilliant companies, such as those in my hon. Friend’s constituency, will be able to sell their products into Japan without hinderance.
Further to the question from the hon. Member for Stirling (Alyn Smith), if the FT article is correct, the Government have, in this deal, signed up to more restrictive conditions on state aid than those being negotiated with the European Union. Will the Secretary of State confirm that the negotiations with the EU are all about deterring it from reaching a deal so that it will walk away, and we can then blame it for no deal and not take the hit that would otherwise be aimed at the Government?
Last year, 277 Welsh businesses exported to Japan. Does the Secretary of State agree that the new tariff reduction in beef represents an exciting opportunity for farmers such as Brian Bown, who is chairman of my local National Farmers Union and is at a cattle auction this afternoon, and Gerald Thomas, who is president of the Farmers’ Union of Wales?
British beef and lamb were let back into the Japanese market in 2019. In this deal, we have achieved significant tariff reductions on beef and more protection of geographic indicators such as Welsh lamb and, of course, Ynys Môn sea salt from my hon. Friend’s constituency.
There are huge benefits to the economy of north-east Wales, whether in digital and data, agriculture such as Welsh lamb, or areas such as manufacturing, where we have reduced the cost of bringing in car parts and agreed closer regulatory co-operation between Japan and the UK.
I would have thought it was impossible to put a line through me, but that is by the bye.
First, I thank the Secretary of State for all that she is doing. Her eagerness to get trade deals the world over is infectious and should encourage everyone in the House. It is an indication of the fact that the global market is anxious to get started with the UK as a trading partner.
I note that there are set to be strong tariff reductions for UK pork and beef exports, with low tariffs for food and drink, and more generous quotas for malt than in the EU-Japan deal. Will the Secretary of State confirm how that will translate for malt for my local whisky producer, Echlinville Distillery in Kircubbin, and for Bushmills whiskey as well? How will it translate for the Northern Ireland pork and beef industries, which provide the best pork and beef in the world—we have that in Northern Ireland and in my constituency? Can we expect an increase in the market for exports to Japan?
We absolutely can expect an increase. As I said, British beef has only just been allowed back into the Japanese market, and we are now going to see significant tariff reductions. Northern Ireland is, of course, a strong exporter of such products, and it will also benefit from the increased protection of geographic indicators, whether for the Armagh Bramley apple or the Lough Neagh eel.
The Secretary of State mentioned Nissan; of course, there is an intrinsic link from Nissan to UK steel, which is intrinsically linked into the talks with the United States. Will she guarantee that President Trump’s completely unrealistic and unreasonable section 232 tariffs on UK steel will be removed from the trade negotiations with the United States as a precondition for those negotiations to proceed?
We are very excited in Grimsby about this trade deal, because we feel it will create a huge benefit for our family-owned fish processors, particularly those for flat fish, and for our fish smokehouses of Alfred Enderby. How will this help to improve fisheries?
There are two benefits for fisheries from this deal. First, we are going to see a reduction in tariffs on all kinds of fish, be it mackerel, cod or salmon. And my hon. Friend will be pleased to hear that traditional Grimsby smoked fish is one of the geographical indicators we are going to replicating in Japan.
How long will it be until the UK Government realise that this Japan deal is not as good as is being touted, and then U-turn and renege on it? Should my constituents take the Secretary of State’s word that they will not do so?
I warmly congratulate my right hon. Friend and her ministerial team on securing this deal in such quick order. Wales has a long history of attracting inward investment from Japan, with the first foreign direct investment project from Sony coming to Bridgend back in 1973. However, will she guarantee that the finest lamb in the world—Welsh lamb—will have its geographical indicator protected, so that we can continue our deep trading relationship with Japan?
My right hon. Friend is right about the investment in both countries. This deal seeks to deepen that economic relationship, in services, in manufacturing and, of course, in agriculture. I am delighted to say that Welsh lamb is on the list of geographical indicators that should be recognised by Japan.
The north-east has benefited significantly from Japanese investment, so I welcome the continuation of existing trading relationships, which this deal largely represents. However, the Secretary of State will know that for Nissan and for investors more generally, and for jobs in the north-east, the deal that matters is the “oven-ready” one with the European Union. Will she set out precisely what the differences are between the state aid provisions in this Japanese deal and those rejected in the EU deal, apart from the fact that the latter are already in place?
I have recently visited Hitachi and Nissan, both of which are pleased with the progress we have made in the Japan deal. Of course, like all of us, they want a deal with the EU, but it has to be the right deal for Britain. My lesson, as Trade Secretary, is that we have to be prepared to hold out for the right deal.
May I join others in congratulating my right hon. Friend on securing such an important deal? I hope she goes on to secure future deals for Britain. May I also encourage her to ensure that this new opportunity is considered in the integrated review, because our economic security and our national security go hand in hand?
My right hon. Friend is right on that, and one important aspect of this deal and our relationship with Japan is that it is a leading free enterprise democracy. We need to be working with like-minded countries, not only to protect free trade across the world, but to make sure trade is fair. That is one of the huge benefits of joining CPTPP: it is a high standards trade agreement of countries that believe in free trade.
May I welcome the progress that was made in relation to geographically protected indicators, a number of which come from the northern isles in relation to this deal? The Financial Times article, to which other Members have referred, does say that David Frost is concerned that the Secretary of State has given away more in relation to level-playing field issues than he is offering to the EU. If that is correct, then that is very serious indeed. Will she commit to publishing the state aid clauses now?
I am sorry to hear the right hon. Gentleman denigrate foodstuffs from his own constituency. [Hon. Members: “Wool”!] I am sorry but I did not hear him. We are still in the legal scrubbing process with Japan —[Interruption.] That has nothing to do with wool. Once that process is finished, we will be sharing our text with the International Trade Committee, which will then fully analyse it.
I congratulate my right hon. Friend heartily and her chief trade negotiation adviser who, I think, led this particular negotiation if I recall correctly. I want to welcome the fact that the Government have agreed disciplines to avoid anti-competitive market distortions and subsidies in particular. Does she think that we could offer a similar regime to the EU in order to reassure it that we will be behaving fairly as an independent United Kingdom?
Our total trade last year with Japan was worth £31 billion, which is hugely important, but to put it in perspective, our total trade last year with the Netherlands was three times that amount. Although we all welcome this deal, is the Secretary of State concerned that we have not yet secured our continued free trade with the Netherlands and the other 26 EU member states?
I do not think that £30 billion is to be sniffed at in terms of our trade with Japan. The hon. Lady must look to the future when what we will see is the vast majority of global growth coming from outside the EU. What we want is for the UK to be hitched to those growth opportunities, so that our businesses can expand. I do not see today as a maximum or a steady state. Of course we can do more in the future, but what these lower tariffs mean is that it will be easier and more economic for our businesses to export to Japan.
First, I congratulate my right hon. Friend on this fantastic deal, which demonstrates not just Britain’s place in Asia, but Britain’s place on the Asian and American continent as part of CPTPP. I am delighted that she is joining me and the Japanese Defence Minister in praising the CPTPP and encouraging Britain to play a more active part. Will she also, however, urge the Defence Secretary to bring the Japanese into the six eyes, as it will be then?
I will pass that call on to my colleague, the Defence Secretary. My hon. Friend is absolutely right about the central importance of TPP, not just as a huge economic opportunity for the United Kingdom, but as a beacon of free trade and fair play that will be vital as we seek to reform the global trading system.
Based on the British Government’s own best-case scenario figures, am I right in calculating that it will take 71 deals of this nature to make up for what will be lost by pursuing the British Government’s policy of leaving the EU single market and customs union?