House of Lords
Monday 1 March 2021
The House met in a hybrid proceeding.
Prayers—read by the Lord Bishop of Leeds.
Introduction: Baroness Chapman of Darlington
Jennifer Chapman, having been created Baroness Chapman of Darlington, of Darlington in the County of Durham, was introduced and made the solemn affirmation, supported by Lord Falconer of Thoroton and Baroness Hayter of Kentish Town, and signed an undertaking to abide by the Code of Conduct.
Introduction: Lord Etherton
The right honourable Sir Terence Michael Elkan Barnet Etherton, having been created Baron Etherton, of Marylebone in the City of Westminster, was introduced and took the oath, supported by Lord Woolf and Baroness Hallett, and signed an undertaking to abide by the Code of Conduct.
Arrangement of Business
My Lords, the Hybrid Sitting of the House will now begin. Some Members are here in the Chamber and others are participating remotely, but all Members will be treated equally. Oral Questions will now commence. Please can those asking supplementary questions keep them short and confined to two points? I ask that Ministers’ answers are also brief.
To ask Her Majesty’s Government what steps they plan to take to allow cadet forces to resume face-to-face activities.
My Lords, I remind your Lordships of my charitable interest as chairman of the Cadet Vocational Qualification Organisation, a post I took over from the noble Lord, Lord West.
My Lords, the cadet forces are following the overarching UK Government and, where applicable, devolved Administration rules and guidance on Covid matters. Throughout the pandemic, cadet headquarters have accelerated virtual training programmes, through innovative IT solutions. There will be a cautious but progressive return to face-to-face cadet activity. Based on previous experience and the development of Covid-safe practices, the cadet forces are well placed to return to normal activity as soon as conditions permit.
My Lords, I am grateful to my noble friend for her helpful—indeed, hopeful—reply. Does she agree that there seems to be no reason why cadets should not parade as soon as possible, now that schools are back? Does she also agree that cadet activities, whether Army, sea, Royal Air Force or CCF, are not just a welcome recreation for young people, but for many, especially in areas of deprivation, a route away from trouble and the youth justice system, and a pathway towards vocational skills and possibly employment?
I thank my noble friend for his support of and interest in the cadet forces. Taking his latter point first, I entirely agree that the proven benefit to young people of being in the cadet forces is demonstrable; it has an extremely beneficial effect on them in the development of their personal skills and as they prepare for life in the future. As to return, we shall require to be informed by the relevant guidance and rules at the time. There is certainly an appetite to resume face-to-face activity.
My Lords, I am most familiar with the Army Cadet Force, because I am a former member and I benefited much from that in my teenage years. The guidance and instruction I received stayed with me. However, it is extremely difficult for cadet forces to function properly without face-to-face activity. Will the Minister assure the House today that the ACF and other cadets—and, indeed, other voluntary youth organisations, which are an intricate part of society—will be given every assistance when some normality returns? Where does she see the ACF and other cadets on her list and what is the indicative timetable? Please will the Minister help us with that information?
The noble Lord will understand that I cannot give a specific timetable, but I can reassure him that there is certainly a desire throughout the United Kingdom, where the cadet forces are such an important presence for our youth in the four nations, to let them resume their activities as soon as guidance and rules permit.
My Lords, like many, I started my uniformed career as a cadet, in my case an Air Force cadet at Kimbolton School Combined Cadet Force. I have no doubt that the discipline it gave me helped me in my modest academic achievements. One of the great success stories in recent years has been the cadet expansion programme, with 500 new cadet forces created by 2016. Will my noble friend update the House on how the target of reaching 60,000 cadets by 2024 is progressing?
I reassure my noble friend that the expansion scheme has been a great success, exceeding time limits for achievement. Obviously, the pandemic has had an impact, not least on our school recruitment, because we have missed the September 2020 date, for example. But there is a strong partnership between the MoD and our cadet units in schools and we are mindful of that. That is partly governed by the Department for Education as well. I thank my noble friend for raising the issue. It is an important programme and we are confident of it making positive progress.
My Lords, the cadet forces constitute one of the finest youth organisations in the land, but they are crucially dependent on the adult volunteers who organise them and run their activities. These people have come under increasing pressure in recent years, because of growing regulatory and other burdens, and have found their roles becoming less rewarding. Can the Minister assure the House that, in the wake of Covid, the Ministry of Defence will place sufficient emphasis on recruiting and retaining these adult volunteers, without whom the cadet forces simply would not exist?
The noble and gallant Lord is absolutely right. We are very mindful of the significance of the role played by our cadet force adult volunteers, to whom I pay tribute for their extraordinary achievements during the pandemic. Undeterred, they have continued to encourage and engage with the cadet forces and are deserving of our highest admiration. We recognise that within the MoD and will support them in every way that we can.
My Lords, I wish everyone a happy St David’s Day and put on record my interests as president of the Army Cadet Force Association in Wales. Army cadets play an active role in the community through the citizenship training that they receive. They do this thanks to the contribution of our cadet force adult volunteers, who inspire these young people, but these volunteers need to be supported, as the noble and gallant Lord, Lord Stirrup, has just said. Last year, the Army Cadet Force Association made grants totalling £200,000 to volunteers who faced financial hardship because of Covid. So I ask the noble Baroness what specifically the MoD is going to do to help these men and women whose voluntary work makes such a great contribution to the physical, mental, social and economic health of Great Britain.
I reassure the noble Lord that we shall support them in every way that we can. As he is probably aware, there is a youth and cadets team within the Reserve Forces and cadets division of the MoD, which engages with the DCMS and the National Youth Agency in England. We are doing everything that we can to consult, collaborate, co-operate and support.
My Lords, I declare an interest as chair of the cadet health check team, where we have seen tremendous commitment, creativity and sheer hard work from staff and cadets, in creating inspirational online activities in lockdown. As has already been mentioned, the cadets are particularly important for disadvantaged young people, who learn skills, self-respect, leadership and other qualities through active engagement with others. The Minister’s previous answers suggest that she might not be able to say, but what more particularly do school cadets need to do to convince people that they can resume their life-changing work?
As the noble Baroness understands, the environment of a school is within the jurisdiction of, initially, the head teacher of the school and, secondarily, the Department for Education and its counterparts within the devolved nations. There is a recognition of the valuable work that cadets do and a universal desire to support their return to face-to-face activity.
Is it not the case that the Government’s excellent objective to increase cadet forces in state schools could be greatly assisted by drawing on the long experience of independent schools? Are the Government actively promoting collaboration between the two sectors of education in this vital area?
I say to my noble friend that we are always anxious to learn. He is quite correct that one of the welcome developments of the expansion programme has been to extend and increase cadets’ presence in the state school sector. I think he will also acknowledge that there are commonalities of interest. Regardless of which sector of education the cadets are in, there is a desire to share experiences and mutual learning.
My Lords, last year, the Government published a review of the Reserve Forces and cadets’ associations, which recommended that the council of the RFCAs and the 13 RFCA bodies should be merged into a single executive non-departmental public body. Can the Minister provide an update on this?
The noble Lord is aware that the MoD committed to implement the recommendations of the report. It has established a programme team to take forward the review’s recommendations, which we are doing in conjunction with the RFCAs. The report has many positive suggestions, which points to a very healthy future for the reserves and cadets.
My Lords, as a former Army cadet, I ask the Minister whether she agrees that it is so important to get young people to take plenty of exercise, from both a health and morale point of view. In addition, does she agree that the well-established and efficient way of controlling cadets would minimise or prevent the spread of Covid among them?
My noble friend is absolutely right: the experience of cadets and the activities in which they engage are conducive to good physical and mental health. We ensure that their activities are Covid-compliant. When face-to-face activities resume, we shall follow whatever the prevailing rules and guidance are.
My Lords, in the West Midlands, we have four Army Cadet Force detachments, three RAF Air Cadet detachments and, even in landlocked Birmingham, 23 Sea Cadet detachments with over 1,000 cadets. They are an important force in the local community. I urge the Minister also to engage with local universities in the summer resumption of face-to-face contact, to ensure not only that the work continues but that new recruits are found.
The noble Baroness makes a very interesting suggestion, which I will certainly reflect on. Given that the age range for cadets goes up to 18, our principal engagement is with schools, but I will look into this further.
My Lords, the time allowed for this Question has elapsed.
Domestic Energy Efficiency: Retrofitting
To ask Her Majesty’s Government what policies they plan to put in place in relation to the use of domestic energy efficiency retrofitting to meet their goal of net-zero carbon emissions by 2050.
My Lords, the UK has made good progress in improving the energy performance of existing homes but reaching net zero will be challenging. We are responding to this challenge by introducing long-term minimum standards, providing financial support where it is needed most and getting the market conditions right so that people can access tailored advice, green finance and quality supply chain. We will set out further details in our heat and building strategy in due course.
My Lords, I know that the Minister will not be able to pre-empt the Budget but, given the abject failure of the green homes grant, can he reassure me that the Government are well advanced with plans to bring in a quick, simple and workable scheme to inject government funds—ideally with the administration not outsourced to a US multinational—to deliver the £65 billion in investment for the 2020s that he told me in a Written Answer in November would need to be spent on domestic retrofit this decade to meet the net-zero 2050 target?
The noble Baroness is correct that I cannot pre-empt the Budget, but I agree that there have been significant challenges in getting the green homes grant voucher scheme up and running. We are working closely with the scheme administrator to streamline the voucher issuance and redemption process as a top priority. The noble Baroness might be interested to know that, as of 22 February, we have issued 25,000 vouchers against a total of 110,000 applications.
My Lords, the £1.5 billion green homes grant scheme was launched by the Chancellor last July with a target of 600,000 homes. It was going to reduce carbon, create 16,000 jobs and tackle fuel poverty. The Prime Minister extended it for a year in November, yet here we are in March with it on the verge of being scrapped. As the Minister said, fewer than 25,000 grants have been made and less than £100 million of the £1.5 billion has been spent. What lessons will the Government take from this total failure into a much-needed plan B?
We are of course always keen to learn lessons. I acknowledged in the previous answer that there have been significant challenges in getting the scheme up and running, but I assure the noble Baroness that considerable effort is going into improving its performance.
The Minister cannot pre-empt the Budget, but someone is briefing the press that the green homes grant will be slashed on Wednesday. Our ambassadors are warning that COP 26 is in danger because of the perceptions abroad of government action. Does the Minister agree that there must be a review of where the Government are going with their green policies, very quickly?
We are progressing well with our green policies. The Prime Minister’s 10-point plan indicated the route map forward, and we will be publishing the heat and building strategy shortly.
My Lords, a vital part of our efforts to tackle climate change and reach net-zero targets is catching CO2-emitting boilers in households across the country. This is a painstaking and expensive job that must be rolled out household by household. Can the Minister confirm that the commitment to installing 600,000 heat pumps a year by 2028 still stands, and if it does, are the incentive arrangements in place to deliver this adequate?
The noble Baroness is right that these targets are a challenge, but I can confirm that the target remains the same for heat pump installations. We will set out further details in the heat and buildings strategy. She will be aware of the tremendous commitments that we made in the manifesto to spend money in this area.
Does the Minister recognise that, contrary to his earlier assertion that we have made good progress on energy efficiency upgrades, at the rate of progress achieved by the green homes grant scheme it would take 480 years to retrofit all the homes in the UK that need it? Does he also recognise the huge damage that the stop-start, short-term nature of the scheme has done to industry confidence, which is vital if industry is to invest in the skills required to undertake this immense and vital task?
It would of course be best to have long-term guarantees of funding, but we continue to have these discussions internally. I agreed earlier that the green homes grant scheme has been a challenge. We are working hard to improve its performance because we must get it working and up and running to bring about confidence in the supply chain.
My Lords, does my noble friend recognise that the advent of another huge government subsidy scheme will be widely welcomed by cowboys? Can he assure me that the new scheme will work closely with local authorities to ensure that those thinking of having their homes retrofitted can find a reputable person to undertake this easily and quickly?
My noble friend’s reference to local authorities reminds me that the other part of the scheme, the local authority delivery scheme, is working extremely well. We are working closely with a number of local authorities. He is right that we need to invest more in training. We have awarded more than £7.5 million of funding to support the development of new and better retrofit technologies.
My Lords, can the Minister confirm that Her Majesty’s Government agree with the Sustainable Energy Association—I declare an interest as its president—and the Committee on Climate Change, that a target for all domestic properties to reach energy performance certificate band C by 2035 is important and realistic as the halfway marker to achieving the Government’s net-zero goal by 2050?
We remain committed to getting as many homes as possible to EPC band C by 2035 where it is practical, effective and affordable.
My Lords, the Government heralded the green homes grant scheme as a key programme for retrofitting and net zero, but the scheme has descended into a fiasco, as we have heard, with small businesses not being paid, cuts to funding for the next year and the slow installation of measures. According to the Government’s own statistics, nearly 61,000 voucher applications were from low-income households, but only 799 measures have been installed for those families—just 1.3%. Can the Minister explain why the scheme is failing low-income families so badly?
I am not sure that the noble Baroness’s figures are correct, but I will write to her with the correct information. The scheme is not failing low-income families. We have maximum grants of £10,000 available, many of which are being taken up by low-income families. We have issued thousands of vouchers to installers to retrofit works in low-income families’ homes.
What consideration are the Government giving to reducing or eliminating VAT on energy-efficient products and services, as recommended by the Environmental Audit Committee? I was always told that EU membership prevented the Government doing that, so what is to stop them now?
The noble Baroness is tempting me down the same path as the noble Lord, Lord Mann, of trying to predict what the Chancellor might announce in his Budget. She will need a little patience.
My Lords, does the Minister accept that the proposed energy efficiency rating measurement does not consider vital differences in properties? For instance, rural properties are less likely to be heated by mains gas, and old rural houses with solid walls have a thermal capacity that is not considered. Consequently, it will be disproportionately difficult and expensive for them to be adapted. Will these differing circumstances be recognised?
The noble Lord makes a very good point. I have received a number of representations from rural landlords and others on these matters. We recognise that improving older rural properties may be more challenging. That is why we have provided an incentive for off-gas homes to be insulated under the current eco-system and will focus the future home upgrade grant on poorer performing homes. The noble Lord will also be aware that we produced a range of exemptions under our minimum standards regulations for homes that are too expensive or too difficult to improve.
My Lords, I remind the House of my interest as president of National Energy Action. Will my noble friend work closely with bodies such as NEA to ensure that the least-efficient homes will obtain the highest amount of warm home grants and other grants that are available through the government schemes?
We work with a wide range of organisations. My noble friend is right to point out that it is important that we target the poorest-performing homes for the first and most urgent action. We will certainly do that as far as possible under many of the current schemes.
United States: Diplomatic Relations
To ask Her Majesty’s Government what plans they have to conduct their diplomatic relations with the Government of the United States on the basis of sovereign equality.
My Lords, we look forward to deepening the close alliance between our two sovereign nations. At the G7 meeting on 19 February we welcomed President Biden’s reaffirmation of the centrality of the transatlantic partnership in dealing with the challenges the world faces. We will work closely with the Biden Administration through our presidency of the G7 and COP 26 this year. With so many commonalities between us, we are confident that the UK/US relationship will continue to prosper and strengthen.
My Lords, the noble Lord, Lord Frost, the Prime Minister and others have declared that sovereign equality is a vital principle for becoming global Britain once more. I assume it ought to apply to all relations with other countries, which suggests we should renegotiate some of the structurally unequal aspects of the US/UK relationship, such as the status of US bases in Britain and the arrangements on extradition. Or do we need an alternative concept for the US/UK special relationship: sovereign dependence?
My Lords, our partnership with the US reflects some of the points that the noble Lord has raised and yes, that includes defence and security. The bases in the United Kingdom underline the importance of not just the UK/US relationship but of our working together in partnership to strengthen institutions such as NATO.
My Lords, America is back. President Biden has reset US relations with the Middle East, in particular with Iran, Israel and Saudi Arabia. Will the Government follow the US line in respect of bypassing the Crown Prince of Saudi Arabia and freezing arms sales to Saudi Arabia?
My Lords, I acknowledge what the noble Lord says about US re-engagement on important issues on which we partner, and I understand the premise of his question on the relationship with Saudi Arabia. Our relationship is important, but we call out human rights issues, among others, with the Kingdom of Saudi Arabia. Our arms exports are managed through a very rigorous arms export regime.
The Foreign Secretary told the Munich security conference that we have restored sovereign control over our foreign policy, as if we did not amplify our influence through the EU. He also said that the first deployment of our new aircraft carrier to the Indo-Pacific will have a squadron of American F35 jets on board and will be accompanied by an American destroyer. Is this our new sovereignty?
My Lords, the noble Baroness will know from her experience that we work very closely with our allies, of which the United States is the important one, and that includes co-operation on defence and security. We should recognise the positive nature of this engagement.
My Lords, in our relations with the United States, could we please make it clear that what we welcome from the new presidency is more emphasis on partnership in a networked and completely changed world and rather less talk about merely resuming American leadership, as back in the 20th century? For instance, does my noble friend agree that the future of Asia, in which our nation and national story are increasingly involved, goes beyond just US/China competition and that the revival of the nuclear joint agreement with Iran needs a careful coalition of countries and cannot be done by American diplomacy alone?
My Lords, I agree with my noble friend. That is why the United Kingdom has engaged on an Indo-Pacific tilt in terms of our foreign policy strategy and development objectives, and it is why we are seeking dialogue status within ASEAN. On the JCPOA, we welcome recent announcements from President Biden’s Administration. It is important that Iran also reach out and adhere to the structure of the JCPOA so that we can progress discussions further.
My Lords, the noble Lord, Lord Wallace of Saltaire, referred to the unequal nature of the UK extradition treaty with the US. On February 12 last year, the Prime Minister referred to the treaty and said:
“I do think that elements of that relationship are unbalanced, and it is certainly worth looking at.”—[Official Report, Commons, 12/2/2020; col. 1.]
Will the Minister assure the House that the Government will begin to work towards a fairer, more equal extradition arrangement with the US Government?
My Lords, my right honourable friend the Prime Minister has stated the Government’s intent. We regard our relationship with the United States as a partnership. The relative size and mobility of the populations of the UK and the US naturally results in a greater number of extraditions from the UK to the US than from the US to the UK. Nevertheless, I note what the noble Baroness said and I think my right honourable friend the Prime Minister has made our views very clear.
My Lords, picking up the point made by my noble friend, the biggest humanitarian crisis the world faces is in Yemen. Surely it is now time for the UK to work with our biggest ally, mirror the actions of the United States on arms sales and step up our contribution and humanitarian effort. However, according to press reports, instead of stepping it up and leading the way we are about to cut our aid support in Yemen from £181 million to £90 million. I hope the Minister will be able to say that we will not be doing that.
My Lords, the conflict in Yemen has brought great misery to its people, as is clear from our television screens and from what we have seen in the ongoing Covid-19 pandemic. On ODA allocations for future support, Yemen will remain the key priority country, but those decisions are yet to be taken.
It is a special pleasure today to greet the House and say, “Have a very happy St David’s Day”, not only because of the rugby result but because we are discussing American presidents. Two of the greatest—Thomas Jefferson and Abraham Lincoln—were of Welsh heritage. When President Biden comes, I ask that he have discussions not only with Westminster people, with us in this Parliament, but with the Parliaments in Belfast, Edinburgh and Cardiff.
My Lords, I am sure the President’s team have noted the noble Lord’s suggestion and will reflect on it.
My Lords, notions of sovereignty are clearly contested, even in the way we use the language. Is it time for a public education programme through which the Government can explain why pooled sovereignty with the EU is a deficit for the UK but when it is pooled with the United States, it is seen as a positive?
My Lords, your Lordships’ House is always an education for any Minister. I note very carefully what the right reverend Prelate has said. Partnerships are about ensuring that we play to the strengths of the partnerships we have, and that is what global Britain is all about.
My Lords, from sovereign equality to gender equality. We have seen some very welcome progress from President Biden’s Administration on sexual and reproductive health and rights. Does the Minister agree that we have a great opportunity to work closely in partnership with the United States in international development to make real progress on gender equality and SRHR? Specifically, can he say how the Government will make the most of this opportunity in the coming months and years?
My Lords, the short answer to my noble friend is yes. As the PSVI lead on preventing sexual violence I am looking forward to engaging with my US counterparts.
My Lords, government strategy strays occasionally into individual policy pragmatism over consistency when deemed in the national interest: building back for a better world by ensuring accountable government globally, the eradication of corruption and being in lockstep with respecting human rights, including sanctioning leadership impunity. If that is so, is the right choice therefore not just to be sovereign equals with the US or elsewhere but a combination approach, equally embracing multilateralism and supporting policies because, individually, they are the right ones to champion?
My Lords, there is little in what the noble Lord has said that I disagree with. As ever, he provides valuable insights into our relationship with the US and other partners.
My Lords, in 2017, the then Vice-President Biden declared that he and President Obama believed that deterrence of a nuclear attack should be the sole purpose of the US nuclear arsenal. As a presidential candidate, he pledged work to put that belief into practice in consultation with allies. This language was adopted in the Democratic Party’s official 2020 platform. I understand that consultations with the UK have begun. What is the Government’s position on the US nuclear declaratory formulation that the sole purpose of nuclear weapons is to deter nuclear abuse against it or its allies?
My Lords, as the noble Lord will be aware, we welcome the re-engagement of the US, in particular on its obligations through NATO. That will form the basis of how the United States continues to strengthen defence alliances with the United Kingdom and others in the defence of not just the interests of the United States but those of its allies.
In paying tribute to the noble Lord, Lord Wallace, as a historian, I remind noble Lords that we come together on the eve of the famous speech given 75 years ago in 1946 by Winston Churchill when he defined what the relationship was all about. He said that
“in the days to come the British and American peoples will, for their own safety and for the good of all, walk together side by side in majesty, in justice and in peace.”
Long may that last.
My Lords, all supplementary questions have been asked. We now move to the next Question, which is the fourth Oral Question and I call the noble Lord, Lord Randall of Uxbridge.
Commonwealth Countries: Reciprocal Pension Agreements
To ask Her Majesty’s Government whether they have received any requests from Commonwealth countries to discuss reciprocal pension agreements in the last two years; and if so, which countries have made such requests.
Are you there, Lord Randall?
If you can hear me, Lord Randall, you are on.
I will call the noble Lord, Lord Randall, one more time. He is not there, so I call the noble Baroness, Lady Altmann, to ask her question.
My Lords, I understand that the Government are in talks with Canada on possible reciprocal arrangements for state pensions uprating. Can my noble friend tell the House whether they are in discussion with any other countries on this issue, including those in the EEA, EFTA and the EU?
The Government are currently negotiating social security agreements with the EEA and the EFTA countries—Iceland, Norway, Liechtenstein and Switzerland—which aim to broadly mirror the new agreement with the EU. The UK state pension has been uprated in these countries as part of the long-standing provision which was in EU law before the UK left the EU, and the Government are seeking to continue state pension uprating for those in scope of the new arrangements. The Government are not in discussion with any other countries on reciprocal arrangements for pensions uprating.
My Lords, the Commonwealth should be united by a common commitment to human rights and the well-being of all. Sadly, this has been marred by our silence over the brutal repression of the farmers’ dispute in India. Does the Minister agree that reciprocal pension arrangements can help restore the image by, for example, allowing retirement to Commonwealth countries, which will reduce healthcare needs in the UK?
The UK has different social security arrangements with different Commonwealth countries. While some bilateral agreements provide for uprating, others do not. I am very happy to meet with the noble Lord to discuss this further if it helps him.
My Lords, further to the question from the noble Baroness, Lady Altmann, last week some of us met virtually with Canadian MPs and the Minister of Seniors. He told us that a proposal had been put three months ago to the British Government that would provide some pension justice for the 125,000 British pensioners living in Canada but that they have had no reply. When will the Government respond and can the Minister assure us that it will be a positive response that will help both UK pensioners in Canada and Canadian pensioners here?
The noble Lord is as impatient as ever, and so are we, to resolve this issue. The Government received a request from Canada in November 2020 to conclude a reciprocal agreement to include indexation of pensions. We will be responding shortly.
My Lords, people with frozen pensions have often lived abroad for more than 15 years and have also lost their vote. Is it not time that the Government restore democratic rights to these citizens, many of whom still pay their taxes in the UK?
The decision to move abroad is voluntary and a personal choice dependent on the circumstances of the individual. For many years now, advice has been provided on the GOV.UK website that the UK state pension is not uprated overseas, except where there is a legal requirement to do so.
My Lords, during the passage of the Immigration and Social Security Bill, we discussed the case of Monica Philip who emigrated to the UK in 1959. After 37 years working here as a civil servant, she returned to Antigua to care for her mother, at which point her pension was frozen. The Minister told me during that debate that she did not know how many of the Windrush generation are affected by this policy. Do the Government plan to look into this any further?
I regret that I do not have figures for how many Windrush victims have been impacted. The UK state pension is payable worldwide and members of the Windrush generation who have chosen to leave the UK and have reached state pension age will receive annual index-linked increases if they reside in a country where there is a legal requirement to uprate, such as Barbados or Jamaica.
My Lords, many British pensioners living in the EU have been anxious about their pensions since we left the EU. What action have the Government taken to protect British pensioners living in the EU?
The state pension has been uprated in the EU as part of long-standing provisions in EU law before the UK left the EU. The withdrawal agreement ensures that state pensioners who had already moved to the EU to retire while the UK was a member state will continue to have their state pensions uprated.
My Lords, more than half a million people are affected by having their pensions frozen while living overseas. The Government have said on a number of occasions that they do not intend to change the overall policy. How can it be right that something so iniquitous and unjust continues to persist, discriminating in respect of which countries people emigrate to?
The UK Government have continued to honour their legal obligations in relation to uprating pensions overseas. While I realise this will be disappointing, we have no plans to change that policy at the moment.
My Lords, I could not defend this policy when I was the Pensions Minister 20 years ago and I did not, but the Treasury would not move on it and this is a real problem. How is asking people to work around the world but freezing their pensions in 150 countries if they retire consistent with global Britain? It is absolutely unfair and incompatible with being an international nation, as we claim to be. I ask the Minister to think about her answers, because it seems she has given contradictory answers on Canada to the noble Baroness, Lady Altmann, and the noble Lord, Lord Foulkes.
I am sorry, I do not agree that I have given contradictory answers. I say again that the Government have no plans to change their policy on this. When people retire to different countries, information about the impact on their pensions is made very clear to them.
Can the Minister accept that dignity in retirement should exist for all UK pensioners regardless of where they live as a principle? As raised by the noble Lord, Lord Foulkes, and the noble Baroness, Lady Altmann, the Minister in Canada is waiting for a reply from the UK Government. If, as the Minister here says, it is about a reciprocal arrangement, surely this discussion should start urgently, as both the Government and Members of Parliament in Canada seek a resolution.
As I have already said, the Government intend to respond to the Canadian Government shortly. We are committed to ensuring that older people can live with the dignity and respect they deserve. The state pension is the foundation of support for them.
My Lords, what consideration are Her Majesty’s Government giving to unfreezing the state pensions of the 230,000 Britons who have moved to Australia to take into account rises they would have received in their state pensions if they were still living in the UK? Some now receive only £48.75 per week, despite having made national insurance contributions in the UK throughout their working lives.
As I understand it, the previous agreement with Australia, which did not include uprating, was terminated by Australia in 2001 due to the UK’s refusal to change its policy on pensions uprating abroad.
My Lords, all supplementary questions have been asked. This brings Question Time to an end.
Covid Contracts: Judicial Review
Commons Urgent Question
The following Answer to an Urgent Question was given in the House of Commons on Wednesday 24 February.
“Protecting those who protect us has been one of the Government’s most important goals in our fight against Covid-19. To do that, we have had to expand our personal protective equipment supply chain—it has gone from supplying 226 NHS trusts in England to supplying more than 58,000 different settings—and we have had to create a whole new logistics network from scratch. Thanks to the hard work and dedication of so many people, we have delivered more than 8.6 billion items of PPE to the front line so far, with billions more ordered and being supplied.
Our team worked night and day to procure PPE within very short timescales and against the background of unparalleled global demand. That often meant working at incredible speed, especially in the early months of the pandemic, to secure the vital supplies required to protect NHS workers and the public, which we did.
Let me turn specifically to the High Court judgment. There has been a lot of confusion about what the ruling said and did not say, and I welcome the opportunity to clarify that to the House today. The High Court case did not look at the awarding of the contracts; rather, it looked at the timing of the publication of the details of contracts awarded. The court ruled that at this time of unprecedented pressure, contract award notices were not all published in the timescales required by the regulations. However, it also found that there was no deprioritisation policy in that respect in the department. As we set out to the court, the delays were caused by the workload involved in responding to one of the greatest threats to public health that this country has ever seen.
We take our transparency requirements very seriously, and it is important that I put on the record that we of course take the judgment of the court very seriously and respect it. We are working with colleagues across Government to implement the recommendations set out in the report published earlier this month by the Public Accounts Committee, chaired by the honourable Member for Hackney South and Shoreditch (Meg Hillier), but as we do that, we will keep acting quickly and decisively to respond to this deadly threat, and we continue to do all we can to help save lives.”
My Lords, a year ago, Parliament gave the Government huge power so they could act quickly in the face of the pandemic. Unfortunately, growing evidence suggests that Ministers have taken advantage of these powers to the disadvantage of the taxpayer and to the cost of health workers and patients. The NAO report in November revealed that the Government set up fast-track systems for billions of pounds of contracts for people personally known to Ministers, Peers and MPs. They found that suppliers with links to politicians were 10 times more likely to be awarded contracts than those who had applied to the department in the normal way.
It looks like there is more to be explored here: not just a case of “delayed paperwork” as the Health Secretary has claimed but serious procurement rule breaches. Will the Government urgently publish the names of all companies awarded public contracts through the VIP lane and how much they were paid? What steps are the Government taking to recover millions of pounds of public money from companies which failed meet their contractual obligations?
My Lords, I am grateful for the question from the noble Baroness, Lady Thornton. During those hectic days, more than 15,000 suppliers approached us. Many of them were credible, but many sadly were not. It was entirely right and the best practice to have a high-priority lane to triage and prioritise those who were the most credible. A sample of 232 suppliers in that lane reveals that 144 came from Ministers, 21 from officials, 33 from MPs and 31 Members of the House of Lords not in the Government—including many who chose to write to me personally with the names of recommendations. I am enormously grateful to those who got in touch.
My Lords, the Prime Minister said last Monday in the House of Commons that
“the contracts are there on the record for everybody to see.”—[Official Report, Commons, 22/2/21; col 638.]
However, the evidence questions that statement. Can the Minister say how many PPE contracts entered into in the first wave of the pandemic, up to the end of June, remain unpublished? If the number is not to hand, please will he undertake to write to me with it?
From memory, it is my understanding that 99% of the contracts are published and 1% are outstanding. I am happy to check that and confirm it to the noble Baroness.
My Lords, it is fair to say that I have not been uncritical of some of the Government’s approach to this virus crisis and, of course, it is important that the Government follow proper procedures and are beyond reproach in their procurement policy. However, in relation to the judgment, did the judicial review find any impropriety in the behaviour of the Government, or was it a question of straining every sinew to deliver essential equipment to front-line workers, as the Government were urged to do by Rachel Reeves down at the other end?
My noble friend puts it extremely well. The judge said
“the overall picture shows the Secretary of State moving close to complete compliance. The evidence as a whole suggests that the backlog arose largely in the first few months of the pandemic and that officials began to bear down on it during the autumn of 2020”.
The judgment was entirely about the timing of the publication; it had nothing to do with the awarding of the contracts themselves. From that point of view, it is a ringing endorsement of the actions of officials in this matter.
My Lords, I strongly support the Secretary of State’s decision to prioritise saving patients’ lives, albeit that the contractual process appears to have breached the rules. Does the Minister agree that the real problem was the failure of Governments over the preceding 10 years to give proper attention to preparations for a pandemic which everybody knew could be around the corner? Can the Minister assure us that this failure will not be repeated, and systems are in place to ensure proper preparation in future?
My Lords, it is not for me to do the post-match analysis; that will be for those in the future. I reassure the noble Baroness that we have 32 billion units of PPE procured, including 19 billion purchased by the DHSC, 10 billion purchased by SSCL and 2.5 billion manufactured by our brilliant UK companies. We have 120 days of PPE ahead of us, and I can very confidently say that we are in great shape for anything the pandemic may throw at us.
I declare an interest as director of the Good Law Project, which brought the action against the Government. Can the Minister clear up a confusion about this judicial review? In the wake of losing it, Matt Hancock, the Health Secretary, refused to apologise and said that dealing with the pandemic meant that breaching the legal obligation to publish within 30 days was “the right thing to do”. However, the case revealed emails showing that civil servants’ serious concerns that
“we are in legal breach”
were overridden in order
“to allow No.10 SpAds … enough time to be sighted and given full opportunity to comment”.
Why would the desire of No. 10 to provide comment on the mere publication of a contract legitimise a legal breach? Can the Minister explain the inconsistency between these facts and the Health Secretary’s professed explanation?
The right honourable Secretary of State for Health and Social Care put it extremely well. For those of us who were there at the time, the priority was saving lives, not publishing contracts or focusing on anything other than the protection of those who work and live in care.
My Lords, 25 million masks that could not be used were supplied by a pest control firm in a £59 million deal, while a Mauritius hedge fund got £252 million, and, again, the face masks could not be used. There was also a £70 million contract with a Florida jeweller for gowns that could not be used. Will the Minister commit to a judge-led public inquiry into the handling of such PPE procurement?
As the noble Lord knows, I cannot comment on some of those cases specifically because they are subject to legal action at the moment. However, in broad strokes, I say that there were a lot of people who stepped forward to help us in our time of need; I do not condemn them. Some of them came not from the PPE industry but from others. I am extremely grateful to all those who stepped forward to help us when we needed it.
The Minister is on very thin ice. He is following Machiavelli’s teachings that the ends justify the means. He should be careful— this is the same argument that led to French aristocrats being guillotined after the revolution, to Stalin’s terror and to the blackshirts of Kristallnacht. Does he accept that the Government and Ministers have to obey the law? If he thinks that this case was trivial, where does he draw the line? Contracts to cronies? Clearly not—not until No. 10 spads have been “sighted”. Proroguing Parliament illegally? Clearly not. Interning vaccine refusers? Where is the line?
I am enormously grateful for the colourful character of that question. However, the noble Lord makes a serious point. We do respect the law, which is why we have published the contracts. The case found that we had published them 17 days late. Any reasonable person faced with a huge pandemic would think that a 17-day delay is a perfectly reasonable price to pay for saving lives. The noble Lord asked me about the price we are willing to pay and the reasons for standing out on this: saving lives is what this delay was about.
My Lords, at the beginning of this pandemic, I—like many Members of this House, I suspect—was approached by various suppliers and manufacturers asking how they could assist in supplying, or even making, PPE, ventilators and the like. Indeed, an appeal was made by the Health Secretary to this end. Of course, the difficulty was knowing who to contact. To assist in a similar future crisis, would the Government consider providing a direct hotline to deal efficiently with a large number of calls from people responding with help—rather like what Crimestoppers provides for police appeals?
My Lords, the noble Lord puts it extremely well, and he takes me right back to those days. I remember making a public call for help with diagnostics, and an NHSBSA call centre was overwhelmed by 5,500 calls in a week—triaging them took nearly a month. The noble Lord is entirely right: getting through all of those who sought to help was an enormously difficult task, and those who proved to be effective assistants were not always the obvious ones. I could share anecdotes of surprising people who came forward and gave tremendous help, while those who you would think could help simply did not have what we needed. Those were extremely complicated times, and I pay enormous tribute to the officials who saw us through them.
My Lords, the Minister has been explaining how the centre was overwhelmed by the number of offers. In the early stages, why was it not dealt with by a greater degree of local decision-making and autonomy? Local authorities and hospital trusts were bypassed in this, as in a number of other areas, such as test and trace. Would it not have been much better to have allowed small companies and local authorities to bargain with each other about these offers in the first place?
That is a reasonable question, and, in fact, that was our starting point: the noble Lord will remember that, at the beginning of all of this, we supplied PPE to 252 NHS trusts and no one else—everyone else sorted out their own PPE. The reason we had to change was that this was a global crisis: borders were shut, factories closed down and every country in the world was desperate for PPE. There was no facility for a procurement manager at an NHS trust, let alone a small social care home in the West Country; those avenues were all shut. That is why it took a massive national effort to secure PPE. We now have a portal that supplies more than 50,000 different NHS and social care units; as I explained earlier, we have an enormous stockpile to secure that. This has been one of the big learnings of the pandemic: in order to have resilient supply chains, there needs to be some national muscle to make sure that it works properly.
My Lords, the time allowed for this Question has elapsed; I regret that we were not able to reach everyone on the list.
Uber: Supreme Court Ruling
Commons Urgent Question
The following Answer to an Urgent Question was given in the House of Commons on Wednesday 24 February.
“I want to begin by making it absolutely clear that everyone deserves to be treated fairly at work and rewarded for their contribution to the economy with both fair pay and fair working conditions. This means that employers must take their responsibilities seriously, not simply opt out of them. If there is a dispute between the individual and an employer, as seen in the recent case involving Uber, the courts consider each case on an individual basis. The courts are independent and the Government do not intervene. As such, with the Supreme Court being the final stage of the appeal, its judgment is final and Uber will need to take action to align with the judgment.
The Government recognise concerns about employment status being unclear in some cases, and we are committed to making it easier for individuals and businesses to understand which rights and tax obligations apply to them. We have made good progress in bringing forward measures that add flexibility for workers while ensuring the protection of employment rights. For example, we have legislated to extend the right to a written statement of core terms of employment to all workers, making access to a written statement a day one right and extending the contents of a written statement. We have also banned the use of exclusivity contracts and zero-hours contracts to give workers more flexibility. This means an employer cannot stop an individual on a zero-hours contract from looking for, or accepting work from, another employer. We will continue to explore options for employment status that protect rights while also maintaining flexibility in the labour market. This Government have a proud history of protecting and enhancing workers’ rights, and we are committed to making the UK the best place in the world to work.”
The Supreme Court ruling of 19 February was a good day for workers in the gig economy and an embarrassing one for the Government. It has taken four years to get this ruling, with Uber kicking and screaming all the way. During that time, the Government commissioned and received, but then ultimately ignored, a report from Matthew Taylor about workers’ rights in the gig economy.
Either the Government accept that workers must have decent, understandable and contractual rights at work—including receiving at least the national minimum wage—or they do not, in which case workers will continue to be exploited by these huge multinational organisations. Do the Government accept that this ruling must apply to all Uber drivers and those other comparable gig-economy workers, such as those who work for Deliveroo? If not immediately, when precisely will the Government bring forward an employment rights Bill based upon the Taylor report and, by doing so, prevent businesses having to interpret this ruling for themselves?
The Government are committed to improving the clarity around employment status and to bringing forward an employment Bill, which we will do as soon as possible. The Bill will protect and enhance workers’ rights, promote fairness in the workplace and strengthen workers’ ability to get redress for poor treatment.
My Lords, the Minister will be aware that Uber has made statements suggesting that it believes that the ruling is limited only to a handful of individuals and that subsequent changes mean that it will not apply to current staff—but that is not the advice that others are giving. HMRC has statutory responsibility for enforcement of the minimum wage, and it can take action either on its own initiative or in response to complaints made online. If enforcement action is taken by HMRC, then it will be for Uber to prove that it has complied with its obligations, and the two-year limit on claims will not apply. Is HMRC expected to take that action, and is government encouraging it to do so?
The noble Lord will be aware that I cannot comment on individual cases, but, of course, HMRC is fully empowered and able to take all the action that it requires in order to get people to comply with the law.
My Lords, everyone knows that Uber is a thoroughly disreputable and exploitative company, and I warmly welcome the Supreme Court’s decision. Will the Minister now ensure that Uber does not weasel out of its obligation to all drivers, past and present? Will he also encourage HMRC to go after it for its billions in back taxes, and will he bring forward urgent legislation to make sure that all companies in the so-called gig economy are no longer able to exploit the lowest-paid workers in this country? That is a thoroughly Conservative view of these things.
The noble Lord knows the tremendous admiration that I have for him, but I have to disagree with him on this. The thoroughly Conservative thing is that there is choice and competition in the market, and Uber has provided tremendous choice and competition, particularly in London. It is not just Uber—there are other apps as well. The monopoly previously enjoyed by black cabs was bad for the consumer. They were overpriced and Uber has been a thoroughly good thing for the market in London—so I disagree with the noble Lord on that one.
My Lords, I am delighted to agree with the Minister’s remarks. As has already been mentioned, the Supreme Court ruling probably applies to many other areas. I am thinking, for example, of freelance broadcasters in local radio. The Minister has already partially answered my question. It is always better to avoid court if we can, so we do need to simplify the legislation surrounding workers and workers’ rights. Does the Minister agree that that would help to avoid court cases in future?
Of course, it is always better if these matters are settled without court action. As I said in a previous answer, we are committed to bringing forward an employment Bill. I thank the noble Lord for his support.
My Lords, I agree with the noble Lord, Lord Blencathra. Will the Government now enshrine the very welcome Supreme Court judgment in statute by including its principles, plus the availability of workplace pensions, in the long-promised but long-delayed new Bill on employment rights and the gig economy? Will they also reject the expected campaign by Uber and other global tech companies to reverse or limit the judgment and so strike a blow against bogus self-employment, with all the risks to the tax base and other problems that it incurs, and eliminate abuses in the gig economy?
I never thought I would hear the noble Lord say that he agreed with my noble friend Lord Blencathra, but there we are. I make absolutely clear that the Supreme Court judgment is final, and Uber will of course need to align its business model to comply with it. Employers have a duty to automatically enrol qualifying workers into workplace pension schemes. This already extends to engagers of agency workers and those on temporary, fixed-term and zero-hours contracts.
I refer to my entries in the register of Members’ interests. I proudly declare myself a user of Uber’s services, as well as those of home-grown, UK global companies such as Deliveroo. I congratulate the Minister on his thoroughly Conservative—indeed, three-Shredded-Wheat—response to the noble Lord, Lord Blencathra. But why has the position of the Director of Labour Market Enforcement, previously occupied by the distinguished Matthew Taylor, been left vacant, despite his offer to carry on until a replacement is found? It is an important role, given where we are.
I thank the noble Lord for his support. In my view, it is all about choice in the market. Those who wish to use services such as black cabs are free to do so, as are those who wish to use Uber or other home-grown services. That to me is the essentially Conservative thing; it is about choice and competition, which produce better standards for all. In answer to the noble Lord’s question, we will be making an announcement shortly.
My Lords, it is good to hear that the Government will introduce legislation to simplify this complex area of the law and end repeated litigation over workers’ status. Does the Minister agree that simplicity requires that worker status be limited to a simple binary choice between employees on the one hand and, on the other, those who are genuinely in business on their own account, with their own clients and customers?
As I said, we are committed to considering options to improve clarity on employment status and how best to address that in a post-Covid scenario. However, it is important that we retain the flexible labour market that has served this country so well and has resulted in our unemployment rate being significantly better than that of the rest of Europe.
My Lords, I too welcome the decision of the Supreme Court. Those who have read the judgment of Lord Justice Leggatt will realise the detail which the court went into in deciding that, whatever the lawyers had devised, the reality of the relationship meant that the Uber drivers were in fact workers. I welcome the news that there is to be legislation, but I suggest that there are some occasions where the courts will have to deal with the reality. Even the best-drafted legislation will have to set out the principles. The courts here were doing precisely what they should do—applying the principles of the Act to the reality on the ground.
The noble Lord has put the case very well. The Supreme Court’s decision is, of course, final. Uber will have to comply with that judgment, as everybody else has to comply with court rulings.
My Lords, I want to follow up the issue raised by my noble friend Lord Monks of the implications of this judgment for pension provision. Including these people within the aegis of automatic enrolment throws up a series of practical problems. There is the question of whether back pay will be pensionable. These workers tend, by their very nature, to have widely fluctuating emoluments, which again creates problems. Will the Government be undertaking a study of the implications of this judgment for pension provision, particularly under automatic enrolment?
The noble Lord makes a good point. Of course, pension entitlement is based on employment status, age and income. It is a complex area of law and we will, of course, look very closely at the judgment.
My Lords, the Uber case was directly concerned with the national minimum wage, the working time regulations and whistleblowing under the Employment Rights Act, but it applies to all rights enjoyed by workers that are subject to statutory regulation. Pension is deferred pay. Does the Minister accept that workplace pensions and, as my noble friend mentioned, auto-enrolment under the Pensions Act 2008 for eligible job holders, are aspects of what is secured as a consequence of the Supreme Court judgment?
Well, many individuals working in the gig economy will already be eligible for automatic enrolment and all employers have a duty to automatically enrol qualifying workers into the appropriate workplace pension scheme. All workers aged between 22 and the state pension age who earn more than £10,000 a year and are working, or ordinarily working, in the UK will be entitled to be automatically enrolled into a workplace pension.
Education Return and Awarding Qualifications in 2021
The following Statement was made in the House of Commons on Thursday 25 February,
“With permission, I would like to make a Statement regarding the opening of educational settings, our plans to help children catch up and the arrangements we have put in place for qualifications.
The Prime Minister announced on Monday a cautious road map for the gradual relaxation of our current social restrictions. It is not quite the end, but the end is very clearly in sight. As the House is by now aware, the rates of Covid infection have come down enough for us to let children go back to school from Monday 8 March. Secondary and college students will be back from that date, after being offered an on-site Covid test. University students on practical courses who need to access specialist facilities can also return to campus from 8 March, and we will be reviewing the timing for the return of the remaining students during the Easter holidays.
The Prime Minister spoke of a one-way road to freedom. For this reason, we have issued detailed guidance about what we expect all schools and colleges to do to welcome children and students back. A robust testing regime will be in place that will be critical in breaking the chains of Covid infection. More than 4 million tests have already been completed across primary and secondary schools, colleges and universities. I know that staff have worked very hard to set up testing sites in schools and have had time to get used to supervising the testing that goes on. I know that the whole House will join me in thanking every one of them for the incredible efforts they continue to make to keep young people safe and learning.
Primary school staff will continue to receive two home tests a week, and this will be extended to private early years providers and secondaries, and secondary school and college students will be offered three tests in school and college when they return over the first two weeks, to be undertaken three to five days apart. Students will then be offered two home tests per week, so that they can test themselves regularly. Schools will be able to retain small on-site testing facilities for those who cannot and have not been able to test at home. Staff and students at independent learning providers and adult community learning providers will also be able to test at home. On-site testing facilities are already set up in universities, and staff and students there can take two tests a week.
We are following public health guidance and advising that in circumstances where social distancing cannot be maintained, face coverings should be worn in secondary school classrooms as well as in further and higher education settings. This is a temporary measure to ensure the safe return of schools and will be in place until Easter. All the other safety measures that are already in place continue to be robust, including bubble groups, staggered start and finish times, increased ventilation and strict hygiene measures.
This has been a hugely challenging time for teachers, staff and parents. The House will be well aware of the incredible work that has already gone into minimising the effects of this pandemic, but I know from research that we have been conducting that it will not be enough. Many children are going to need longer-term support to make up for lost learning. We want families to know that there will be support for schools and for our children. Sir Kevan Collins, our education recovery commissioner, will be working with parents, teachers and schools on a long-term plan to make sure that pupils have the chance to make up their learning over the course of their education.
As an immediate support, we are putting in place a range of additional measures to help children and young people across England to catch up. We are introducing a new one-off £302 million recovery premium for state primary and secondary schools, building on the pupil premium to further support pupils who need it most. We are expanding our successful tutoring programmes: £200 million will be available to fund an extended national tutoring programme for primary and secondary schools and tutoring and language support in colleges and early years settings. Two hundred million pounds will be available for secondary schools to deliver face-to-face summer schools. Schools will be able to target individual pupils’ needs. The package will build on the £1 billion catch-up package that we announced just a few months ago and forms part of a wider response to help pupils to make up on the lost learning that they have suffered.
I would like to update the House on the next steps after we decided that GCSEs, AS and A-level exams, and many vocational and technical qualifications, could not go ahead as planned this summer. In January, we launched a joint consultation with Ofqual on the best way to do this, so that the results for 2021 are as robust and as fair as possible. I am very glad to say that we got more than 100,000 responses from students, parents, teachers, school leaders and other stakeholders as part of that consultation, and we have considered all of them very carefully. I assure right honourable and honourable Members that there was widespread support for the approach that we are taking.
Our priority is and has always been to make sure that every student has the best possible chance to show what they know and can do, enabling them to progress to the next stage of their education, training or employment. The most important thing that we can do is to make sure that the system is fair to every student. It is vital that they have confidence that they will get the grade that is a true and just reflection of their work. This year’s students will receive grades determined by their teachers, with assessments covering what they were taught and not what they have missed. Teachers have a good understanding of their students’ performance and how they compare with other students this year and from previous years. Teachers can choose a range of evidence to underpin their assessments, including coursework, in-class tests set by the school, the use of optional questions provided by exam boards and mock exams. We will, of course, give guidance on how best to do this fairly and consistently.
Exam boards will be issuing grade descriptions to help teachers to make sure their assessments are fair and consistent. These will be broadly pegged to performance standards from previous years, so that teachers and students are clear what is expected at each grade. Doing this with a rigorous quality assurance process are just two of the ways that this system will ensure that grades are fair and consistent. Quality assurance by the exam boards will provide a meaningful check in the system and make sure that we can root out malpractice. We will also set out a full and fair appeals system. It will provide a process to enable students to appeal their grades, should they believe that their grades are wrong.
I can confirm that no algorithm will be used for this process. Grades will be awarded on the basis of teachers’ judgment and will only ever be changed by human intervention. There must, of course, be as much fairness and rigour applied to vocational and technical qualifications as there is to general qualifications. For those qualifications that are most similar to GCSEs, AS and A-levels, which enable people to progress to further and higher education, external exams will not go ahead and results will be awarded through similar arrangements as set out for GCSEs and A-levels. Where students are taking VTQs to go straight into a job, exams and assessments should take place in line with public health measures. This is so that students can demonstrate the occupational or professional standards that they need to enter the workplace safely.
All our children and young people have paid a considerable price for the disruption of the past year. It has knocked their learning off track, put their friendships to one side and put some of the wonder of growing up on hold. In short, it has caused enormous damage to what should have been a carefree and an exciting part of growing up. I am absolutely committed to the view that, with this programme of catch-up measures and the extra funds for tutoring, we can start to put this right. Together with the measures that we have set out for a fair and robust allocation of grades, young people will be able to look forward to the next stage of their lives with confidence. Our approach in the face of the worst disruption to education since the second world war has been to protect the progress of pupils and students. Ultimately, this summer’s assessments will ensure fair routes to the next stages of education or the start of their career. That is our overall aim.
In summing up, Mr Speaker, I am sure you would agree with my assessment that, as a nation, we have perhaps never valued education as much as we do today, and I commend this Statement to the House.”
My Lords, it is fitting that the Statement emphasises the tremendous efforts of all staff in schools and colleges who have made schools as safe as they can be, at some risk to themselves. I echo these sentiments.
It was obvious before Christmas that there were likely to be problems with grades. Indeed, I and other noble Lords said as much when the ministerial Statement on exams and accountability came to your Lordships’ House on 8 December. Why did the Government sit on their hands and pretend otherwise until it was too late to come up with a genuinely robust proposal? Can the Minister explain why, despite schools closing at the start of January, exam board guidance will not be available until the end of March? That simply increases the uncertainty and anxiety already widely experienced by students, parents and teachers. The proposals for checking and confirming teachers’ grades seem flimsy. It would have been possible to build in much more comprehensive moderation arrangements between schools, using the skills of experienced examiners and exam markers. Without this, there can be no guarantee of consistency and fairness. There is surely a risk that the rigorous will lose out, compared to the less rigorous.
There is also a serious risk that schools, colleges and teachers will be exposed to unreasonable pressure to give students the grades they—or their parents—expect. It must be made clear and emphasised that exam boards, not schools, are responsible for issuing grades and appeals. As things stand, it seems that a school can appeal against a grade awarded by one of its own teachers. This is awkward, to say the least.
The likely volume of appeals and disputes will also present a capacity issue. How can the Government guarantee that the system will be able to cope with these pressures? Faith in the proposals has hardly been enhanced by the very public resignation of Sir Jon Coles from the Ofqual recovery committee just as the new measures were being announced. He was a former DfE director-general and the department’s own nominee to the Ofqual committee. What does this say about the robustness of these proposals?
I turn to the return of schools and colleges. During the first week back, they will be required to carry out three tests for each of the 3.4 million secondary-age pupils. Many schools have lost income or face higher costs because of the pandemic. What support and resources will the Government make available for schools and colleges to deliver the testing, including additional financial support?
In January, the Secretary of State said that he wanted school staff to be in the next wave of vaccinations. Yet, despite the obvious benefits this brings in facilitating the return to school, there has been no commitment since to prioritising school staff. Do the Government no longer believe that teaching staff should be a priority?
Finally, 8 March is also the date on which independent training providers are expected to have the majority of apprentices and trainees back on site. ITPs and their learners seem to be at the back of the queue for receiving Covid home-testing kits. The Association of Employment and Learning Providers says that a general rollout is not expected before April. This cohort includes high levels of vulnerable and disadvantaged learners who are more likely to be affected by Covid-19. It is unacceptable that they should be doubly disadvantaged by a lack of access to testing. Many have little or no access to the technology needed for remote learning, so anything that delays their return to classroom delivery is damaging.
There is an obligation on training providers and employers to provide a safe environment before learning can resume. Already, providers are concerned that they are potentially leaving themselves open to legal action. Can the Minister explain what providers are meant to do in these circumstances?
We all want not simply to see schools and training facilities fully reopened but for it to take place on a sustainable basis. This requires a creditable system, underwritten by a plan B. If the Government have learned anything during the last 12 months, it is surely that a fallback position is necessary to take account of fast-changing events. This Government have been characterised throughout the pandemic by indecision and U-turns. This has had a particularly damaging effect on young people seeking to gain the education and qualifications that will prepare them for the world of work. How can the Minister guarantee that the measures outlined in the Statement will offer a more certain way forward for students, parents and teachers?
My Lords, I thank the Minister for this Statement. The last 12 months have been like a giant wrecking ball for the education of our children. We welcome the reopening of schools and the Covid measures that the Government have put in place, but we have consistently argued that individual schools are best placed to respond to their circumstances. We should give head teachers the flexibility to know how to operate their schools safely.
We welcome that Sir Kevan Collins will work on the recovery plan, crucially together with teachers, schools and parents. It is important that we get this right. Each child’s circumstances vary enormously. The learning gap has widened. Today, the Education Policy Institute has reported that sixth-form and college students from poorer homes find themselves about three A-level grades behind their more affluent colleagues. A few extra lessons of catch-up will not compensate for a year’s loss of mainstream education. We need a rigorous and far-reaching plan to ensure that nobody is left behind. I am surprised that there is no mention in the Statement either of additional support for the well-being and mental health of children, or of children with special educational needs.
I turn to this summer’s exams. Thank goodness that there will not be assessment by algorithm. It is right to have teacher assessment. The amount of learning and study that each pupil has been able to access will vary enormously. Teacher assessment is the only fair way to understand individual pupils’ circumstances and learning. Can the Minister confirm that there will be no school league tables of results? Why not use a more broadly based quality assurance model rather than relying on random sampling? I am sure the Minister is concerned about grade inflation. What plans do the Government have to reverse it?
Finally, how will home-educated children and older adults be assessed for GCSEs and A-levels? I am sorry to spring that question on the Minister. If she does not know the answer, perhaps she could write to me.
Teachers and support staff have worked flat out to keep school learning on the road. We owe our school staff a huge debt of thanks for their dedication and professionalism.
My Lords, I am grateful for the support of both noble Lords. We are all waiting with bated breath for next Monday when our children can return to school—I am sure that many parents are as well. I join the noble Lord, Lord Storey, in paying tribute to the staff who have worked tirelessly during this period.
Unfortunately, the new variant at Christmas took us all by surprise with its speed. The levels of community transmission meant that we had to shut down schools for the second time. It was made clear to staff that exams were cancelled and that teacher assessments would be the way ahead, so certainty was given at that point. This is a genuinely robust proposal. As noble Lords will be aware, we had to consult. Ofqual and the DfE put out a joint consultation. There were more than 100,000 responses—maybe the largest ever—the majority of which were from students. It is good that they were obviously interested enough to put forward their views.
Teachers will have been getting on with teaching as much of the curriculum as possible. Whether students are to be assessed by examination or by their teachers, that curriculum has to be taught to those children. There has been no confusion among teachers that that has been their job by way of remote education for the majority of students.
By Easter, the exam boards will issue their guidance. Departmental guidance was issued on the same day as this Statement, so some information is already available about the list of materials and evidence on which teachers can rely in order to assess grades. Grades will be assessed on evidence. There will be both internal and external quality assurance. Internally, the head teacher will have to sign a declaration that they have acted in accordance with the guidance and instructions given by the exam board. There will shortly be a consultation on what should be in that declaration. We are relying on the professionalism of head teachers as to how grades will be assessed within their school.
Externally, the exam boards will be able to inspect a school where they have concerns about the way in which grades are awarded to students. As the noble Lord, Lord Storey, said, this will be random, but it will also be risk-assessed. It has been made clear to schools that a significant misalignment with historical data could be a reason for a school falling within the Ofqual risk profile for assessment. Obviously, we are trying not to peg it to historical data, because certain institutions are improving, but we are making it clear to schools that such data are relevant, though not determinative.
The noble Lord is correct. We need to make sure that we communicate clearly to parents and children that teachers are assessing grades, and grades are awarded by the examination boards. Students will not pay for appeals. An appeal to a school will be of an administrative type. For instance, a child might say, “I’ve got this grade, but have you really taken into account all that assessed artwork that I did?” That kind of appeal is based on process. The examination board comes in if there is a substantive appeal. That is the appropriate boundary between schools and examination boards.
Regarding timing, teachers have until 18 June, so they will get the materials by the end of spring term. They will have to put their assessed grades in by 18 June, and the results dates are 10 and 12 August. That should allow time—we are talking of higher education providers in particular—for any appeals to be put forward, hopefully without prejudicing the transition to the next stage. I just want to pay tribute to the work of Sir Jon Coles, both for the department and for Ofqual. His departure is a matter for himself and Ofqual.
This is an important reassurance on testing, for parents, teachers and students: yes, we are providing support, and have been for the last half term, for the costs of the tests and administering them on school premises. That arrangement will continue. Those schools that applied for expenditure on the basis of full reopening, and have not had to spend that money, can reclaim that cost through, I believe, the NHS Test and Trace service.
It is envisaged that the independent training providers, which will receive tests to do home testing along with everybody else, will use the community testing facilities for that three-week period. As I am sure most noble Lords will know, many local authorities have provided access to asymptomatic community testing sites for those three weeks until they join up with the remote testing system.
Teachers will be assessing, and content will have been taught to, all cohorts—there is no minimum level—such that every student will be able to be assessed with a grade, and students will be assessed on what they have been taught.
In response to the noble Lord, Lord Storey, yes, we do trust head teachers to assess these grades, and they have welcomed the guidance. Over this period, the department has had to issue guidance to schools about how to make schools safer for pupils in line with PHE guidance on bubbles, ventilation, sanitation, et cetera.
For the reasons outlined by the noble Lord, Lord Storey, the national tutoring programme has been extended to the 16 to 19 year-old cohort. The laptop provisions we outlined have been extended to FE colleges as well. Many have been buying those through the bursary fund, but they can now access the central allocation. Also, £102 million has been allocated to tuition for 16 to 19 year-olds for this academic year. Funds are up on last year because of the expected increase in the size of the cohort. So we do have a rigorous plan.
Mental health and well-being have always featured as part of the guidance, and there has been funding for mental health and well-being in return to education, so there are experienced professionals to advise schools. I can assure noble Lords that there will be no performance tables this year. As I have outlined for the noble Lord, Lord Storey, there will be both internal and external quality assurances—by the school and by the exam board.
Finally, private candidates were one of the cohorts particularly affected last year. We consulted on that, and there will be a number of assessment centres. A list will be put up soon. Multi-academy trusts have volunteered to assess private candidates, so private candidates can look at a list. We are assisting with the cost of this. Private candidates can go to an assessment centre and ask to be assessed on the same basis as for a teacher-assessed grade. Obviously, there are separate lists of materials et cetera for those students. Assessment can be done remotely, so a private candidate is not limited to the provision in their town, which might happen not to include an assessment centre. So we are confident that the method we have outlined will put the assessment of private candidates on a par with that of pupils who are within an exam centre. I am also pleased to say we have this year managed to find a way to get those private candidates who were affected last year assessed. I am just grateful to know, as I am sure we all are, that this time next week school will just be finishing for everybody.
We now come to the 30 minutes allocated for Back-Bench questions. I ask that questions and answers be brief so that I can call the maximum number of speakers.
First, I congratulate the Government on making a clear Statement about public exams in good time. We all agree that school is the best place for children. Having watched the development of my five year-old granddaughter Sienna over the past year of lockdown, it is clear she needs to be in school. My son and daughter-in-law are equally clear that she needs to be in school. Does the Minister agree there is no quick fix, especially for reception children, and that help will be needed over a period of time?
I am grateful to the noble Lord for highlighting the situation for early years provision, which has remained open during this time, because that kind of education is difficult, if not impossible, to deliver remotely. This is precisely the reason that catch-up will be for the lifetime of this Parliament. The £700 million is the tranche for this academic year. Sir Kevan Collins, whom I am grateful the noble Lord, Lord Storey, mentioned, will be advising us over the lifetime of the Parliament. We are investing £18 million this year on reception and early years to help those children catch up.
My Lords, thinking ahead, will the Government begin a wider consultation to ensure that 2022 GCSEs and A-levels will be fair and that there will be plenty of time to prepare for them?
That issue and others are precisely what Sir Kevan Collins will be helping us with. We are monitoring interim findings on the amount of learning that has been lost. That will inform some of the basis for assessing how those students are doing. We can really only assess things from Monday to know who has lost what time in education.
My Lords, I draw attention to my entry in the register as a member of the board of Bounce Forward, a charity concerned with children’s resilience. I agree with the Minister that we all want to see our children back in school. We all want to know that it is a safe process, that children will not be taking the virus home and that we will not be wholly reliant on flow tests that have been hardly reliable.
We have learned that any ambiguity in the advice given can be very counterproductive. The Statement says that with specific medical exceptions, school pupils will wear face masks in school at all times. But apparently, and confusingly, the Government have also issued advice that allows parents to opt their children out of this requirement. We know that many people and communities are sceptical about vaccines and are declining them, which I greatly regret. They may be likely to opt their children out of mask wearing. Will the Minister make it absolutely clear today that wearing masks in schools is mandatory, except where there is a medical reason not to do so?
My Lords, we have all got used to the fact that there are certain people for whom there is an exemption from wearing a mask, and it is clear that the matter of how mask wearing is enforced in a classroom, or wherever else in a school there cannot be social distancing, is a matter for the school. We do not believe that we should be dictating how schools respond to different situations. There may be a multiplicity of reasons and particular circumstances, so it is up to the schools, as with any other behaviour policy, to monitor the wearing of masks.
My Lords, we welcome anything that begins to restore normal educational activity for our young people, who have lost so much in lockdown. The Statement talks of secondary schools’ summer schools. How will these be staffed? Our hard-pressed teachers are exhausted by the demands of virtual teaching. Can we be assured that they will not be required to give up restorative summer holidays to continue to work through the summer on these face-to-face summer schools—but, if not teachers, who?
My Lords, we are encouraging secondary schools to aim the summer school programme at incoming year 7s, because that is the transitional year. We have given them £200 million in funding to do this. Using existing staff, who might want to come in and be paid, is an option, as is using supply teachers, volunteers or other people. This is up to the schools. We are encouraging them to run these programmes and we are providing them with the resources to staff them as they choose.
My Lords, I should declare an interest, in that I have one child taking A-levels and one taking GCSEs this year. So far as they are concerned, I trust their teachers; I think they will be rigorous and accurate. But, generally speaking, there is a sense of uncertainty associated with the exam boards’ quality assurance process. I heard what my noble friend said about that, but the scale of the interventions by the exam boards has to be just right. Too little and they have no impact, too much and effectively the exam boards will override the judgments made by teachers and head teachers. Can my noble friend give us any more information about the scale of the quality assurance activity by exam boards?
My Lords, how many times the exam boards decide to intervene will be up to them, in terms of how many random and how many risk-assessed interventions. But I can assure the noble Lord that this is an assessment based on evidence. The exam boards will be training teachers in how to do this; they will be giving exemplar materials—for instance, “This is an example of a grade A essay in history”; and they will be given grade descriptors. We are hoping that all of these, along with the declaration that the head teacher will have to sign, will provide the assurance—but it will be for the exam boards, overseen of course by Ofqual, to do the external quality assurance.
My Lords, on Friday last, the Secretary of State for Health told the nation that one in five local authorities had seen an increase in Covid cases and that this was still a deadly virus. Is this then the right time to bring 10 million people back into daily circulation? There is a settled view from education staff and their unions that schools and colleges should be open to all as soon as is safely possible. However, from March 8, mitigation should be in place precisely to ensure safe reopening. The use of rotas and a staggered approach, as well as the use of additional spaces and staff to allow for the greatest chance of social distancing, would all decrease the risk of a surge in community transmission on the reopening of schools and colleges. Can the Minister offer any hope that the Government, even at this late stage, will consider these helpful suggestions for mitigation?
Obviously the return is data-driven, not date-driven. The controls that PHE have advised have been supplemented by the wearing of face masks in certain situations in secondary schools. It is a balance of risk. We are confident now that the public health figures in most areas for the disease are at such a level that they are counterbalanced by the need to get children back into education. But, as the Prime Minister made clear, we will be watching the data and the figures to ensure that there is not the kind of surge the noble Baroness outlines.
My Lords, can the Minister say whether the Chief Medical Officer’s position on children returning to school is consistent with the views of the Chief Medical Officers of Northern Ireland, Scotland and Wales? For my part, I believe it is extremely important that no child in any part of the United Kingdom is disadvantaged by not having face-to-face teaching as quickly as possible. Is it not the case that children are much more likely to be harmed in the medium and long term by not returning to school and not having that face-to-face teaching than anything to do with the pandemic as things stand at the moment?
I agree with the noble Lord, as I have outlined, about the harm that we all know of in terms of education loss, and of course the harm for certain vulnerable children who have remained at home and what we sadly expect will be a period of referrals to children’s social care after schools reopen. In relation to education, I do not need to say to the noble Lord that it really is a devolved matter. All I can say is that schools in England are reopening in accordance with PHE and CMO advice.
My Lords, would the Minister agree that, if you are going to do an assessment on work that has been done by people going forward, it is very important that the teachers involved know the patterns of the people they are dealing with. If somebody is dealing with, say, a moderate dyslexic who underperforms in essays et cetera—I remind the House of my declared interests here—they might not be in the best place to make the assessment, given that condition, and this might be carrying on for virtually anybody with a special educational need. The teachers may not have the experience to assess what they will do, and these groups often outperform in exams. Will there be an appeals process that goes forward and takes this on? It is a real problem and, as we get better at identifying it, it is a growing one.
My Lords, obviously many of the mitigations that certain children with special educational needs need in terms of extension of time in exams are not obviously going to be relevant under this system. There is a short list at the moment of assessment materials that teachers can take into account; it is not just “sit an essay”. There is are a range of materials and we would and do expect and hope that teachers will know, in circumstances such as the noble Lord outlines, which materials to set for children with those particular needs. I will write to him about whether there is any specific aspect of the training that exam boards will give in regard to special educational needs students and the outperformance in exams that he outlines.
My Lords, I declare my interests as a former general secretary of the Independent Schools Council and the current president of the Independent Schools Association. Do the Government recognise that independent schools want to work as closely as possible with their colleagues in the maintained sector, strengthening the well-developed partnership between them still further, in order to play a full part in the recovery of the entire national education system? Will there be opportunities for independent schools to contribute to the recovery schemes that the Government are now designing?
I thank the noble Lord for his persistence in raising this issue. I have the great privilege of meeting at least every fortnight with the Boarding Schools’ Association and the Independent Schools Council. We have certain partnerships with them, particularly in relation to vulnerable children in boarding schools, but I do want to say, in relation to catch-up being for the lifetime of the Parliament, that now is the moment for us as the department and that sector to really try to square this circle and find a larger-scale way in which the good will of the sector and the needs of our children can be aligned so that we can deliver something more substantive.
My Lords, can I press the Minister on summer school provision again? The summer school catch-up schemes are going to be absolutely essential. Why therefore are they covering only a third of children on free school meals? When are we going to have detailed plans of what will be the content of the curriculum and the expectations? Will this all be left to schools? In which case, will any standards be set? The Minister mentioned the focus on children in transition years. I welcome that very much indeed, because these are very crucial rites of passage. Can she tell me more about what those plans are and when we will actually see them—and, more importantly, when teachers will actually see them?
My Lords, yes, the summer school programme is focused on those in secondary schools for the reason that they have less time left in education. As I say, we are encouraging year 7 because of that transition year. There will be enrichment activities as well as education. There will be further information on this for schools and I reiterate that this is in addition to the holiday and activities fund that is running those activities in disadvantaged communities—so it is summer schools plus that.
My Lords, the risk here is not grade inflation. It is the exact opposite. It is that pupils from poor or overcrowded homes, with special needs, or from schools that provided fewer online lessons, will not get the grades that they would have if they had not missed a year’s education, and their prospects for the future will never recover. I know that the Government have provided laptops, but lots of pupils are still missing out. There is a huge difference between the amount of online teaching provided by different schools. Will the Government agree that schools and exam boards should err on the generous side and take into account a pupil’s ability and the grades they would have got had they not been robbed of a year’s proper teaching, so that they can go on to the apprenticeship or the college or the university that they would otherwise have been able to.
My Lords, this method of assessment for grades means that teachers can take into account how much content has actually been taught. We have not mandated a minimum level, but they should be assessed using these materials only on what they have been taught—obviously not on what they have not been taught—so the teachers can know what content the child can be assessed upon. This should help with the differential learning loss. In relation to disadvantaged pupils, the £302 million of Covid premium is actually based on pupil premium—so we are targeting that at the most disadvantaged students.
My Lords, will recovery schemes be compulsory for all children and fully funded? If not, vulnerable children are likely to lose out. Will such schemes ensure opportunities for sport, the creative arts and social education, which are so important in their own right but also improve academic achievement and mental health and well-being?
My Lords, the recovery scheme summer schools are funded to £200 million and there should be enrichment activities. I am delighted to say that all the wraparound facilities in schools for essential purposes will also be open on 8 March; I am sure that many students are looking forward to being back doing PE and all those other activities when they return to school next Monday.
The noble Baroness, Lady Bennett, has withdrawn, so I call the noble Baroness, Lady Blackstone.
My Lords, in the light of the Sutton Trust’s report last week on the hugely negative effects of university closures, especially on disadvantaged students, will the Government consider advancing the date of their review on when remaining students can return to university, particularly since leaving it to the Easter holidays will give little notice to universities, which need to plan to make a much-needed full return?
My Lords, there will be a one-week notice period for that. The reason for all these gaps is so that action is taken and data is collected and assessed. There are no plans to change the date of that review, but as the noble Baroness will be aware, students on practical courses should return by the 8th if they have not already done so.
My Lords, in my view, Her Majesty’s Government made the right decision in resisting calls to vaccinate teachers ahead of vulnerable people. However, can the Minister give your Lordships’ House Her Majesty’s Government’s view on reports that universities are collating secret waiting lists for admission to university?
My Lords, I have no information at all on secret reports or anything of that nature. As I outlined, we are working closely with the higher education sector, so that after the results days on 9 and 12 August, there will be a period of time to ensure that if a student appeals, any offer they have will be open to them. However, I have not heard of any secret reports.
I strongly endorse the intervention by my noble friend Lord Watson. However, I want to pick up on the question the noble Lord, Lord Addington, raised. In the assessment process and the advice that has been given, which obviously will deal with coursework and marks, there is now this added factor of the external tests—call them mini-exams if you wish. How will the comparator—the declaration of heads—be dealt with by the exam boards and the regulator when some have tests and some do not?
My Lords, during the consultation period the department met with a number of stakeholders—in fact, with just over 100 organisations, including SEND organisations. The tests will be provided by exam boards but they are voluntary; schools will be able to set their own tests. There will be a list of assessment materials that they can use to form the basis of the tests. They can use coursework or something from the first year of GCSE, but they will then sign a declaration. The content of that declaration is being consulted on, but it will say that they have done the assessment process in accordance with the guidance and the outline given to them by the exam boards. However, they will be trained and assisted with grade descriptors and exemplar material so that we can have confidence that grades are as consistent as they can be across different centres.
Can the noble Baroness explain on what evidence the Government made the extraordinary decision to mandate that secondary pupils mask up in the classroom, especially as in August, the Prime Minister described such a policy as “clearly nonsensical”? As this means that children as young as 11 will spend the majority of their waking hours wearing a mask, can the noble Baroness tell us whether any research has been done on the health, educational or social costs of children wearing masks for such an extended period? Finally, can the noble Baroness allay the concern of teachers that wearing face masks in the classroom is not the return of face-to-face teaching, because they are antithetical to classroom engagement? How can the teacher read the room, see who is struggling and see who has understood? That would seem even more important as the Government are now advocating teacher-led assessment, but teachers cannot see whom they are assessing.
My Lords, the wearing of face masks in secondary schools will be reviewed at Easter. This is a three and a half week period during which Public Health England has advised us to do this, and although it is not ideal—no one is pretending that—it is far outweighed by children not being in school and not having their education delivered face to face. Therefore, it is a compromise and it will be reviewed at Easter.
Non-Domestic Rating (Lists) (No. 2) Bill
My Lords, the Hybrid Sitting of the House will now resume. I ask all Members to respect social distancing.
Members will be called to speak in the order listed. Short questions of elucidation after the Minister’s response are discouraged. Any Member wishing to ask such a question must email the clerk. The groupings are binding. A participant who might wish to press an amendment, other than the lead amendment in a group, to a Division must give notice in debate or by emailing the clerk. Leave should be given to withdraw amendments. When putting the question, I will collect voices in the Chamber only. If a Member taking part remotely wants their voice accounted for if the question is put, they must make it clear when speaking on the group.
1: After Clause 1, insert the following new Clause—
“Annual Rates Revaluation Reporting
(1) Within three months of the passing of this Act, and every twelve months thereafter, the Secretary of State must publish a report on the timing of business rates revaluations and lay it before both Houses of Parliament.(2) Each report must contain an assessment of the impact of the timing of business rates revaluations on—(a) the prosperity of towns and high streets,(b) the prosperity of small businesses,(c) the ability of high street businesses to compete with online businesses,(d) local authority finances, and(e) business rates appeal waiting lists.(3) Each report must contain a statement detailing how the Valuation Office Agency and local authorities have been consulted in relation to the timing of business rates revaluations.(4) Each report must make a recommendation as to whether action from the Government needs to be taken to prevent adverse impacts arising from the timing of the rates revaluation.”
My Lords, I draw the attention of the House to my relevant registered interests as a vice-president of the Local Government Association, chair of the Heart of Medway Housing Association and as non-executive director of MHS Homes Ltd.
Amendment 1 seeks to place a new clause in the Bill whose purpose is to require the Secretary of State to publish a report on the timing of business rate revaluations and to lay that report before the House. The report must address the issues I have laid out in proposed new paragraphs (a) to (e) of my amendment. Each point needs careful attention.
Our high streets were in crisis before the pandemic, and the position has been made even worse over the last year. Hardly a week goes by when we do not hear of struggling high streets and well-known businesses leaving the high street for good, or questions being raised as to their future viability. Sir John Timpson, chairman of the wonderful Timpson Group, addressed this very point this morning on Radio 4, reflecting on the work he did looking at our high streets for the Government before the pandemic. The Bill does not address that fact, but merely moves the date of the revaluation so that it better reflects the effects of the pandemic. While that is welcome, it falls a long way short, and the Government have missed an opportunity here to do more to save our high streets.
I do not think one can disagree with the points set out in my amendment. If the noble Lord is going to resist the amendment, can he set out what he and his department are doing to support the prosperity of our towns and high streets? That must go much further than the towns fund, or other small schemes with limited funding. What must happen is fundamental help for all our towns and high streets. Small shops and small businesses on our high streets deserve support as they will be a crucial to our economic revival, including the much loved British pub, which is at the heart of local communities. I also draw the attention of the House to my being vice-chair of the All-Party Parliamentary Beer Group. I very much support its work, and the part that pubs play in our community lives.
We must also address the completely unfair situation that exists between high street businesses and online businesses, which we have discussed many times in your Lordships’ House. There is a much wider debate to be had about business rates as a method of raising finance, but if business rates are levied there must be fairness in the system. There are too many examples today that highlight an unfairness between the high street and online businesses which must be addressed, and this amendment seeks to give the Government the tools to do just that. Business rates raise money for local government and are a key part of its finances. We recently debated a pilot scheme that the Government have under way to increase the funds raised for local authorities through business rates, and again this needs to be looked at, as does the question of appeal.
If the Government do not take the opportunity that the amendment gives them today, I hope they will go back and reflect on these issues. If not, there is no doubt that we will be here year after year, trying to address the serious problem facing our high streets, which the pandemic has accelerated. I hope the Government will take this matter seriously. I beg to move.
My Lords, I speak in support of Amendment 1, just moved by the noble Lord, Lord Kennedy. It is a real pleasure to follow him and his very measured and careful support for the need to tackle the issues on which I too will comment.
I am disappointed that the Government and the Minister have not thought fit to take on board the range of sensible improvements put to your Lordships’ House in Committee. A wide range of noble Lords spelled out the difficulties that an unamended Bill will impose, particularly on the hard-hit retail sector, where the devastation of Covid-19 lockdowns on top of a decade-long decline in high street sales has wiped out a long string of household names, as the noble Lord, Lord Kennedy, rightly rehearsed
The Chancellor’s emergency business rates relief has certainly been a life saver. The Association of Convenience Stores says that four out of 10 of its members would have gone out of business without that support in the past year. It is no wonder that many Conservative MPs are calling on the Chancellor to extend that scheme, and to provide some continuing support to the high street, at least until Covid restrictions are fully lifted. I hope he will do that but, as we discussed in Committee, that could all be in vain if those retailers are then left waiting for years for the revaluation, which this Bill will trigger, to come into effect. The big risk is that the cavalry will arrive too late—in time to count the dead, but too late to bring success to the high street.
Today’s amendment is in default of any response so far by the Government to these issues. It requires an annual audit of the heavy burdens borne by some, especially high street retailers, alongside the unearned tax holidays given to others, particularly distribution centres and the gigantic out-of-town warehouses of the online retailers. Those businesses are booming and occupy property that is virtually untaxed under the present regime, compared to the high street trader.
The amendment refers to the impact of the timing of rates revaluation, and that is what I want to focus on. I want the Minister to respond to this specific point when he winds up: does he acknowledge that unless the Chancellor’s rate relief scheme is extended, or the effective date of implementation of the revaluation in this Bill is brought forward, there will be a hiatus, when many small shops will face ruin? They will be forced to pay wholly disproportionate property taxes, which are now completely out of kilter with current rental and property values. If he does acknowledge the reality of the hiatus, will he undertake to work with the Treasury to bridge it? That could be by extending the existing scheme set out by the Chancellor, or by bringing forward the effective implementation date of this Bill, or both.
Further to that, it is noteworthy that the Non-Domestic Rating (Public Lavatories) Bill has a retrospective implementation date of 2020. I presume that that means that the Government accept the principle that the benefit of a reduction in rateable value can be backdated. If it can be done for public lavatories, surely it should be done for high street shops as well. If the antecedent valuation date is taken as 1 April this year, as set out in this Bill, surely it makes sense in the current circumstances to make that the date from which the payment amount is calculated. That would not be immediate cash in hand, of course, but it could be a vital, bankable credit for a struggling business and give retailers the incentive and the means to keep going through this crisis until the valuation is actually published. Will the Minister undertake to explore this with the Chancellor as one of the ways of closing the chasm between the end of the Treasury scheme and the coming into force of this Bill?
If the Government are serious in saying that we have to build back better, surely this is exactly the time for some joined-up thinking across government departments. Is this not exactly the simple bridging measure that would help stop the disruption of our high streets? We all know that thriving local communities everywhere need ready access to diverse public and commercial services that serve everyone, and that a healthy and diverse local retail sector is an essential part of that. This is not at all about keeping alive an outdated business model that is able to limp along only with tax cuts and subsidies; it is about putting right a taxation injustice that is now beyond dispute, so that high streets can do what they do best: provide local communities with a focal point for the things they need. I support Amendment 1 and I look forward very much to hearing that the Minister does too.
I thank the noble Lord, Lord Kennedy, for tabling Amendment 1, which I wish to speak to, and it is a pleasure to follow the noble Lord, Lord Stunell. I declare my interests as set out in the register. I am a non-domestic ratepayer in Scotland, although I know this Bill does not include affairs in Scotland.
The Bill is all about timing; it is not about fairness, fitness for purpose, the impact on business, sorting out the appeals system or any other aspect of what has become, I fear, a broken system. The Bill ignores the most critical timing issue, which is simply that of dealing with the appeals backlog—ratepayers paying the requested sum until an appeal is settled. In the current circumstances, that is critical. We cannot expect the Covid-related rates holiday to last for ever. We have seen a collapse in retail rental values over the past 12 months, and as both the noble Lords, Lord Kennedy and Lord Stunell, have pointed out, it was a crisis long before this. Some tenants are to pay double the appropriate rates bills. This amendment brings the plight of the high street retailer into high relief. The annual report it proposes would focus specifically on small businesses, as set out in subsection (2)(b). I am pleased that it also addresses the elephant on the table of all non-domestic rates discussions in the retail sector: the killer impact of the online assault on the high street, as we have heard from both the previous speakers.
Online retail is not a bad thing and it is clearly the future for a huge percentage of domestic spending. The bad thing is the Government’s inability—after years of notice, for online is not a new phenomenon—to recognise the twin neglects of taxing the profits of online and of fairness in the spread of rates between the high street and that sector. Subsection (2)(d) of the amendment requires that the report address the impact of the revaluation timing on local authority finances. Rates are a critical ingredient in local authority finance, but unfortunately the funding gap that the next revaluation will create will lead to a difficult political challenge: how to replace the fall in rates funding—another reason to delay the reform so desperately needed.
Subsection (2)(e) addresses the subject of waiting lists for appeals, which I mentioned earlier. This has become critical. Waiting list delays are themselves enough to put many out of business—a good example of shooting ourselves in the foot of local authority funding. The end result will be worse.
I must refer also to the fundamental review—a story of delay. It is most disappointing, in that the most vulnerable ratepayers can hardly speak for themselves. This delay will be the death of many small, innovative and hardworking businesses, the very ones the Government claim to champion. Should the noble Lord, Lord Kennedy of Southwark, press for a Division on this amendment, I will certainly support it. But my greatest concern is that the valuation date for the revised NDR lists has been chosen at a point in the market cycle that provides no evidence. In my 40-odd years in this profession, I have seen highs and lows in the rental value market cycle, but I have never seen paralysis. Paralysis is what we now have in the rental market from which the rate levels are derived. It will probably lead, as I explained in Committee, to a huge mass of rating appeals. I ask the Minister to take these comments back to the Government, but I fear that it is too late.
My Lords, it is a pleasure to follow the noble Lord, Lord Thurlow, and I declare my interest as a vice-president of the LGA. I congratulate the noble Lord, Lord Kennedy of Southwark, on his composite amendment which neatly brings all the issues that have been debated previously into one. During those debates, all the relevant arguments were made, and I speak today in favour of Amendment 1.
It is important that there be annual rate revaluation reporting. Business rates reviews cannot be left to drift from year to year, especially as so many businesses are struggling. Keeping a careful watch on how revaluations are affecting businesses is vital to ensuring a healthy economic recovery. Towns and high streets are being decimated by the lockdown, as the noble Lord, Lord Kennedy, said. Some three-quarters of retail outlets are closed and many have been boarded up. Only essential outlets are open: supermarkets, pharmacies, opticians and some DIY stores. As lockdown is gradually released, many shops will, hopefully, reopen, but the effect of business rates may be the last straw. This must be monitored to prevent the total decimation of the high street shopping experience.
The Association of Convenience Stores has welcomed the Bill and the revaluation date being moved to 1 April 2023. It sees this as a positive step forward but it has several recommendations that would further assist its operation, including a reduction in the burden of business rates by resetting the business rate multipliers to more sustainable levels.
The whole issue of NDR is a balancing act between the need of funding local authorities and the economic viability of businesses. Local authority finances are stretched to the limit. Government grants have been radically reduced over the years and many councils now only deliver statutory services and these to the minimum standards permitted. It is not that councils do not wish to provide those vital services which communities rely on, such as grants, improved play areas, adequate and dignified social care, after-school clubs et cetera; it is the sad, realistic fact that they no longer have the finance to do this.
The understandable increased cost of social care for the elderly, children looked after, and those with learning and physically disabilities has taken every spare pound councils might have had to provide extra provision for speciality services. Without access to business rates, many local authorities will not even be able to provide the statutory minimum level of service in many areas.
Potholes—a constant running problem on the many rural C roads—are becoming deeper and wider. How are local authorities meant to balance the needs for decent roads against the needs of children looked after and adults with learning disabilities? I do not expect the Minister to provide the answer today, but the question will need to be addressed by central and local government working together.
In Committee, I spoke about business rate appeal waiting lists and times and will not repeat my arguments today, but the length of waiting lists should be kept under constant review. The noble Lord, Lord Thurlow, referred to the impact of delayed appeals. An appeal left waiting for years, is a properly elected council waiting years for its legitimate funding. This makes budgeting all but impossible. The ACS suggests reforming the appeals system by shortening the statutory timeframes for the VOA to respond to checks and challenges and improving the transparency of data used to inform valuations. Has the Minister considered this?
Lastly, I want to speak about the ability of the high street to compete with online businesses. Currently, that is an inability. The online business fraternity, previously in most cases, offered free delivery, but the purchaser had to pay the cost of returning unsuitable goods. Nowadays, if you purchase online you are more likely to be offered free returns but be charged for the initial delivery. This encourages purchasers to buy, as they can clearly see the delivery charge, whereas returning a bulky item could be expensive, if free returns were not offered. This has altered the playing field.
With high street retail outlets closed in lockdown and many businesses going under altogether, online is the only way in which to access the goods and services we have been used to. It is extremely frustrating, to put it mildly, for those paying business rates, to see vast profits accumulated online without the need to pay business rates. This has led to a total distortion of the marketplace.
The Minister will have heard these arguments many times, so he and his colleagues in Government have had plenty of time to come up with an answer. What are the Government going to do to ensure that online businesses are treated in the same way as those on the high street, in shopping centres and in business parks around the country? The ACS recommends introducing an online sales levy or an alternative rating methodology for online distribution warehouses and using the revenue raised to reduce bills for retail stores to support the viability of high streets and local services. Have the Government considered this? It is essential this element is addressed for the sake of all businesses concerned and for the funding of local authorities. I fully support the amendment in the name of the noble Lord, Lord Kennedy, and look forward to what I hope will be a positive response from the Minister.
My Lords, I draw the House’s attention to my relevant interests as vice-president of the Local Government Association and a member of Kirklees Council. The noble Lord, Lord Kennedy, has tabled a comprehensive amendment, which addresses issues of concern that were raised and debated in Committee. The Minister was unable to provide sufficient reassurances at that stage, hence today’s amendment, which has the support of the Liberal Democrats, as already clearly stated by my noble friends Lord Stunell and Lady Bakewell.
The Bill as it stands simply changes the date of the assessment of the revaluation to 1 April of this year and to delay the publication of the rateable values until 31 December in the year prior to its implementation. As was debated in Committee, these simple changes may have a profound effect on businesses, the prosperity of our high streets, local government finances and on the appeals waiting lists.
First, I will take the effect on local government finance. During Committee, the Minister sought to provide assurances about the financial impact on council income, and I thank him for that. However, there is a wider point of the double whammy on town centre businesses of the impact of Covid lockdowns and the competitive advantages enjoyed by online business. This is likely to mean that town centres will have several empty shops, which will undoubtedly have a knock-on effect on the remaining businesses.
The Government have some support for town centres, but much is limited and scattered around the country. It does not provide sustained help. Part of the answer lies with the radical reform of the whole business rate system. Will the Minister provide the House with a draft timetable for the introduction of a reformed approach, which, as several noble Lords have stated, has been promised for several years.
My noble friend Lady Bakewell has spoken from her experience of the impact of long appeal waiting lists on businesses and council services. As the Minister will know, councils have to set aside considerable sums for the refund of any possible successful appeal. Will he tell the House the total amount set aside by local authorities for this purpose? If he is not able to do so today, will he agree to set out the information in a letter to those taking part in today’s debate? Is the Minister able to consider an alternative to setting aside large sums for potential refunds that clearly make an impact on the day to day services—as described by my noble friend Lady Bakewell—that a council is able to provide?
The current system of business rating is failing, in that it considerably disadvantages those who have a physical presence as opposed to those purely providing an online retail offer. I am not opposed to online shopping but urge the Government to appreciate the value to communities of physical shopping. As the various lockdowns have shown us, there is an intrinsic value to individuals of physical shopping. One simple benefit is that of meeting another person, in the shop or serving at the till. For too many people living on their own, this may be the one chance in the day that they have to speak to someone.
There is also the benefit to communities as a whole. Local high streets provide a sense of belonging to a place. The importance of place-based services has shone through during the pandemic. Local shops and services are part of that sense of place and play a significant role in supporting well-being. We lose it at our peril.
That leads me to repeat the example I gave in Committee of a small shop in the town centre of Cleckheaton, which pays at the rate of £250 per square metre on its 30 square metres of shopping space. In contrast, a large online-only retailer, with an out-of-town warehouse occupying 40,000 square metres, also in Yorkshire, pays just £45 per square metre. If that online retailer were to pay at the same rate as the small town-centre shop, it would be paying a rates bill of £5 million. That would solve a lot of local government finance issues. The retail playing field is hugely skewed to the benefit of online retailers. The Government must act with urgency to address this imbalance and demonstrate that they really do support prosperous local high streets.
The further problem for the Government and Valuation Office Agency is the timing of the valuation assessment. My noble friend Lord Stunell said today that the changes that the Bill will bring may be too late to save more retailers from closing their high street shops. He suggested bringing forward the implementation date to put it in line with the proposals of Non-Domestic Rating (Public Lavatories) Bill, which was discussed last week.
The noble Lord, Lord Thurlow, drew attention in Committee and today to the timing of valuations, when so much of the high street has been closed for several months. Equally, it is not of benefit to town-centre retailers that the current valuation will be that on which their rates bills will be based for the next two challenging years. The Government should address this issue with urgency, but there is no evidence that they are doing so. I look forward to the Minister’s responses on a number of these issues and hope that they are more positive than those we received in Committee.
My Lords, I am grateful to the noble Lord, Lord Kennedy, for tabling this amendment, which allows us to return to the important matter of how the revaluation will impact on various parts of our economy. I entirely understand that the House wants to consider the impact of the next revaluation on sectors such as the high street and small business. I point out to the noble Lord that the £1 billion future high streets fund is not insubstantial and forms part of the £3.6 billion towns fund. It is an important part of helping our high streets to bounce back. Also, as has been mentioned by noble Lords, there has been the business rates relief scheme throughout the Covid pandemic, which has cost in the region of £10 billion. It is for the Chancellor to signal how that will continue in his Budget later this week.
A number of noble Lords, including the noble Baroness, Lady Pinnock, referenced the shift over many years, even before the pandemic, towards online and away from place-based shopping on our high streets. It is a matter for the Chancellor, who is carrying out a fundamental review of business rates, to consider how to address that. The interim report is due on 23 March and the review will conclude in the autumn.
Businesses have been calling for frequent revaluations and we had planned for the next one to take effect this year. It would have been based on rental values as at 1 April 2019. In the difficult circumstances in which we now find ourselves, this was clearly unsatisfactory, as those new rateable values would not have shown the impact of the pandemic. Instead, the Bill will move the date on which the next revaluation takes effect back to 2023. This will allow us to use rental values as of 1 April 2021, which will better reflect the impact of the pandemic.
As we heard in Committee, some noble Lords are concerned that rental values and the market at 1 April 2021 will be too unstable to undertake the extensive and sometimes complex valuations needed to complete the revaluation. We heard calls to move the date by which rateable values are set to later this year, but I assure the House that the Valuation Office Agency is already working at full pace to contact thousands of businesses to collect evidence of the market, and then to understand and analyse this evidence. This exercise is going to plan.
Moving back the valuation date would take several months out of an already tight timetable and require the VOA to, once again, go back to the businesses and ask them for market evidence as of a new date. I am confident in the valuation exercise that is already under way, and the Government have no plans to change the valuation date.
The amendment brought forward by the noble Lord, Lord Kennedy, asks for a report on the impact of the revaluation to be published three months after the passing of the Act and every 12 months thereafter. In fact, the new valuations will not be completed until the autumn of 2022, and we will not know the multiplier and transitional relief scheme—the other vital parts of business rate bills—until the fiscal event of that autumn. So we will not know the impact of the revaluation on towns, high streets or small business within three months of the passing of this Act or, indeed, within 15 months. This Government—any Government—could not prepare such a report on that timetable.
However, when the revaluation is completed, and the multiplier and transitional relief set, businesses and stakeholders will not need a government report to tell them how the revaluation will impact upon them. Every individual rateable value will be published with the multiplier and transitional relief scheme, and those businesses will be able to see precisely how they will be impacted. These rateable values will remain public and, as is the case with the current 2017 rating list, the VOA will publish regular statistical analyses of the new rating list.
I understand that the House and businesses would like to know what is going to happen at the revaluation, but we must wait until the results of the VOA’s work—work done independently of Ministers, by experts, and based on evidence. The Bill will ensure that the revaluation will better reflect the impact of the pandemic. The revaluation will also reflect trends in the rental market over the last six years, resulting from economic shifts including the growth of online businesses. We may well see these trends reflected in the rental values of, for example, modern distribution warehouses and traditional high streets but, rather than speculate on these rental market shifts, we should wait for the VOA to complete its exercise and look at the actual results.
As with every revaluation, there will be winners and losers. Some ratepayers will see their rates bills fall and others will see theirs rise. I assure the House that, as with previous revaluations, we will introduce a transitional relief scheme to protect those facing large increases at the revaluation. As I have said, we intend to publish details of that scheme and how it will be funded at the time of the autumn 2022 fiscal event, so that ratepayers have plenty of time to plan for changes to their rates bills.
I should again like to reassure the House on how the revaluation will impact on the funding of local government, as raised by noble Lords. In Committee, I had the opportunity to explain in a little more detail how the revaluation could change the amount of business rates paid in individual local authority areas. As I set out then, we will make adjustments to the business rates retention scheme to ensure, as far as is practicable, that the business rates income retained by individual local authorities is unaffected by the revaluation. I am happy to give the House that assurance again today, and to confirm that we will continue to work closely with the VOA and local government on this and all matters related to business rates.
Finally, let me respond to the noble Lord, Lord Thurlow, and the noble Baroness, Lady Bakewell of Hardington Mandeville, on the appeals backlog. The Treasury continues to provide the VOA with the resources required to successfully deliver the valuations and property advice needed to support taxation and benefits. The Treasury works closely with the VOA and its sponsor department, HMRC, to understand the VOA’s resource requirements. The funding requirements to deliver the appeals case load and the next revaluation will be considered as part of those ongoing discussions. I hope that gives some confidence that there will be no issue around resources for the VOA to work through the backlog. On this basis, I hope that the noble Lord, Lord Kennedy, will withdraw his amendment.
My Lords, I thank all noble Lords who have spoken in this debate. The noble Lord, Lord Stunell, rightly highlighted the support the Government have given, which is very welcome. I am very happy to acknowledge that. It has been vital to ensure that businesses have survived through this.
The fundamental question is the unfairness of the present system of business rates. If that is not sorted out, we are going to see the demise of the high street accelerate, and we have to address that at some point. I thank the noble Lord, Lord Thurlow, for his support. As he said, we must address the elephant in the room. As the noble Lord highlighted, it is the twin problem of taxing fairly online retailers—and I wish all online retailers success—to raise revenue from them and the amount of revenue raised from businesses on the high street so that they are taxed fairly as well. Getting that balance right is the issue and that can no longer be ignored.
I thank the noble Lord, Lord Thurlow, for indicating that he would support me if I divided the House. I am often very happy to divide the House, but I have decided that, this time, it is probably not the best thing to do, so I shall not do so—I know the Minister will be very disappointed by that.
The Government must reflect on this. Although it is disappointing that these proposals will not be taken forward, I think that the Government are going to have to do every single thing in my amendment. If they do not do that, they cannot arm themselves with the information they need to take decisions in future Bills and policy, and the crisis will become a complete nightmare on our high streets.
The noble Baroness, Lady Bakewell of Hardington Mandeville, also highlighted the unfairness between online and the high street, and she is right. The risk is that when we return to anything like a normal situation it will not be normal because it will have gone too far and people will not return in numbers to our high streets. I have always supported local shops where I live. I am looking forward to 12 April. I am desperate for a haircut, so I am looking forward to the 12th very much. I am going to my barber straightaway to get it done. It is vital that we support our high streets.
I am very happy to acknowledge the support the Government have given; I mentioned that earlier. It was very welcome and has kept many businesses afloat. It is just a shame that we are not going to address these issues here. I have said before that all the points I have raised will have to be addressed by government because we are going to have to look at the bigger, wider points about what we want from our high streets and how we raise revenue from our high streets and from online so that we can pay for the services we all want. At this stage, I beg leave to withdraw my amendment.
Amendment 1 withdrawn.
We now come to Amendment 2. Anyone wishing to press this amendment to a Division must make that clear in debate.
2: After Clause 1, insert the following new Clause—
“Assessment of effects of timing of business rates revaluations on amateur sports clubs and clubs providing other facilities
Within six months of the passing of this Act, and biennially thereafter, the Secretary of State must publish the report of a review analysing the effects of the timing of business rates revaluations on amateur sports clubs and those providing facilities for physical recreation and cultural activities.”
My Lords, I return to the subject of support for amateur sports clubs which I raised in Committee. I, too—I might as well clarify it now—do not expect to divide the House at the end of this debate. Of course, the Minister might just manage to inspire me by his answer, but that is not normally his style. Let us see if we can be consistent about that.
The reason why I am raising this again is that, although the Minister gave me some answers, I want a bit more detail and thought about how the Government are planning for the future of sports clubs and sport itself. The Government have accepted their importance by giving them some support throughout the lockdown period, but the problems sports clubs have will, as in all sectors, not stop the minute they get back. Actually, the minute we start activity again, problems will be exposed and identified. All of them can be accentuated by finance. Business rates are part of that. That is where it comes from, so let us see if we can get some idea of whether the Government are prepared to go across department and across thinking to make sure that they accept that this group is worth keeping on.
Why are sports clubs worth keeping on? It is quite simple: in this country we have a tradition of sports clubs running themselves and being set up without government support, often with the help of employers—indeed, employers have set up sports clubs which have survived when the employer has gone. We have a tradition of self-help which has provided the infrastructure for sport to take place. At amateur level, sport is dependent on that structure. These clubs and centres depend, for example, on their bars and on renting out rooms for other functions to keep themselves going. They are small businesses and act in the business environment even with charitable status. They have a consistent relationship of raising their own funds. How the Government are thinking slightly longer term to make sure they can carry on doing that is vital.
Let us not kid ourselves: there is a major problem coming through here. I do not know how enforced inactivity has at the moment encouraged people to retire early from a club; for instance, retiring at 32 as opposed to 35. There has been a break in activity. To take a classic example, you will not get fit as easily as you did and you have started doing something else, so you ask yourself whether you want to go through the pain and discomfort of getting back into shape. It is one of the first considerations. Also, perhaps people think they should spend more time with something else. It is when that interaction stops that people stop going. We all know that; anybody who has been involved in this knows it. I do not know how rugby union is going to handle it, having had probably the biggest break. It is probably the biggest example of this model. It will have to restructure. I do not know how, but it will be something to come back to. The Government have said they value these clubs and all the activity outside, education and structure. Clubs are going to have a problem structuring how they take on their activity and how that relates to funding.
Rates is part of that, so I will be looking to get from the Government today an idea of how they think this bit of government fits in. The idea of getting an initial review and then a continuing one is very important. Let us face it: I am not an expert on rates. Having attended a couple of meetings with my colleagues, I decided that I probably do not want to become one. This is a complicated, difficult thing. Something that has no intellectual friends is probably business rates. There is probably someone hiding in a cupboard in Whitehall who quite likes them, but that is about where they are. Can we have a look at how this local taxation affects sports clubs? How are the Government taking this on? Sports clubs are important. We are hearing about social interaction and mental health problems. Sport is a great medium for that. It is the social connection that goes through. It is physical connection and support, and something that is tied into so many other bits of government that it is not true. I hope that when the Minister answers this amendment he will give us an idea of how his department is taking a lead or feeding in on this, because it is one of the links in the chain. If this link is strong and healthy, the rest of that chain may just survive. I beg to move.
My Lords, I refer to my interests in sport as set out in the register. It is a pleasure and a privilege to follow my noble friend in sport, the noble Lord, Lord Addington, and support Amendment 2 in his name. During the passage of this Bill, the noble Lord and I have simply sought to point out that, at a critical time as we seek to emerge from Covid-19 in 2021, it is hoped that the Government will finally take the vital opportunity to initiate new policies. This includes the adoption of this new clause to give a new national impetus to sport, recreation and an active lifestyle, which was missed at the last opportunity created by the London 2012 Olympic and Paralympic Games.
If we are to emerge stronger from Covid, we need to provide opportunities for everyone to be more active and healthy so we can reduce the burden on the National Health Service and have a country that prioritises preventive healthcare and an active lifestyle—frankly, for the first time in our history.
My noble friend the Minister can take one small step with us today. He is a reasonable man; he appreciates and totally understands that moving from the mandatory 80% compulsory relief from business rates applying to community amateur sports clubs, where local authorities also have in their discretion such relief to increase it to 100%, should be accepted and broadened in two ways. First, it should apply to all sport, recreation and physical activity venues and clubs which promote an active lifestyle. Secondly, the policy should be applicable at the level of full rate relief, central to a government programme to ensure that we build back better.
However, we are not asking the Minister to go that far. We are simply asking him to adopt this new clause, just to provide your Lordships’ House and Parliament with an
“Assessment of effects of timing of business rates revaluations on amateur sports clubs and clubs providing other facilities”
and to do so within a very reasonable period of time—within six months of the passing of this Act. We could have asked for a further report to be presented to Parliament every six months, but we wanted to be helpful to my noble friend. We did not even propose an annual review. We asked for a review to be biennial so as to reduce any serious workload on the Minister and his officials. We ask for them to simply
“publish the report of a review analysing the effects of the timing of business rates revaluations on amateur sports clubs and those providing facilities for physical recreation and cultural activities.”
This is such a small request for such a substantial and impressive Minister. It is hardly a great deal to ask. This is the time for the Minister to tear up his speaking notes and communicate with this House from his heart, because he knows this is correct. He knows that the motive behind it is accurate and with his great intellect he can simply stand up and say, “I accept this new clause”.
[Inaudible.]—follow that clarion call to the Minister, but I will try. My noble friend Lord Addington and the noble Lord, Lord Moynihan, have again made a very powerful case again for specific action in respect of amateur and community sports facilities. As my noble friend Lord Addington has reminded us, the Government already provide some support to community sports clubs but it is unlikely to be sufficient to help them balance their books after such a long period of closure due to the various lockdown measures.
I recall that in Committee, the noble Lord, Lord Moynihan, shared the result of an academic investigation by Sheffield Hallam University which valued the impact of community sport at £85.5 billion per annum to the country. The noble Lords have today made a further strong argument for change.
It is not just the impact on the finances of the country that we need to think about in the amendment, but the strong argument made in the discussion on Amendment 1 about the impact on the nation’s health and well-being. That is invaluable in itself. Covid has demonstrated the real importance of daily activity for health and community well-being to us all.
In Committee the Minister agreed with the case made by both noble Lords and said
“I will be a strong advocate” —[Official Report, 4/2/21; col. GC 382.]
of it to the Treasury. We are aware of the benefit of community sports provision. It needs to be valued by the Government for the wider community effect of providing a focus for activity and friendship. Given that the Minister has said how strongly he supports the case, I look forward to his positive response today.
My Lords, I am very happy to support the noble Lord, Lord Addington, in his amendment. Both he and the noble Lord, Lord Moynihan, made a very powerful case when we were in Committee and they have made an equally powerful case today. I am very happy to support them.
As we heard from the noble Lord, Lord Moynihan, we want to be healthier; we have to get people doing more physical activity, because it will have great effects on their health. That is a good thing as people will live longer and have fewer problems with disease, and that will have a knock-on effect on our health service. That is the most important thing behind all this—getting people to be more active and healthier. The Government are currently running a major campaign, quite rightly, which you see on television, at bus stops and everywhere. I fully support that.
It is also important to ensure that local amateur clubs doing a variety of activities in their communities actually get people doing things. Where I live in south London, there is the Francis Drake Bowls Club—I often go past and see lots of people playing on the bowls green. There is also Lewisham Borough Football Club, an amateur club, and the athletics club that takes part on the track in Ladywell Fields. Those are the things that local people can do to become more active and physical, and if we can support them through the rating system, we should.
As the noble Lord, Lord Moynihan, said, all the amendment is asking for is a biennial report. The amendment is much more generous than I would have been as I wanted one every 12 months. If the Government accept this amendment, they will have to do everything that is in it anyway because they need to have good policy, and good policy needs facts and proper information.
I hope that the noble Lord will tear up his speaking notes to resist this and say, “I agree”. I look forward to hearing his response.
My Lords, in my rush to respond to the noble Lord, Lord Kennedy, on the first amendment, I forgot to declare my relevant commercial and residential property interests as set out in the register, so I do so now.
I thank the noble Lord, Lord Addington, and my noble friend Lord Moynihan for their suggestion that I tear up my speaking notes and do what the amendment says. I will seek to reassure them that we have a real commitment to community and grass-roots sports. In that spirit I will refer to a number of things that the Government are doing. My family, friends and I all benefit from community sports and it is right that we do all we can to support community and grass-roots sport, as Members have highlighted.
As I explained in my response to the previous amendment, we will not know the effect of the revaluation on ratepayers for some time and certainly not within six months of the passing of this Bill. The same points apply to this amendment. However, I appreciate that the noble Lord and others want to understand how the revaluation will affect amateur sports clubs. It may therefore assist the noble Lord if I explain how these clubs are valued for business rates—I will try to make the incomprehensible comprehensible.
First, the Valuation Office Agency must, by law, value a property having regard to its current use. This means, for example, that when valuing the site of an amateur cricket club the valuation officer must have regard to its value to the cricket club and not its value to a developer. As you would expect, this important principle means that the rateable value of sports grounds is generally quite low.
The VOA publishes statistics on the rateable value of different categories of properties. The average rateable value in England of sports grounds is £12,000 but the value of many is much less than this and the median rateable value of sports grounds is only £6,000. That equates to a full annual rates bill of about £3,000, which for many will be reduced by the 80% mandatory rate relief. Under those circumstances, many sports clubs will find themselves with a rates bill of as little as £600 per year or £50 per month.
Of course, I appreciate that some clubs will find themselves paying more than this. Business rates reflect the specific circumstances of the property so some clubs, for example with more facilities than others, may find themselves paying more. We also heard in Committee that some clubs may be not eligible for the 80% mandatory relief for community amateur sports clubs. That is a matter specific to the individual clubs but I can understand that some will still have a particular interest in understanding whether their rates bill may change at the 2023 revaluation.
As I have said, we will not know the answer to that until much later in 2022, at the point when all clubs will be able to see their new rateable values. These valuations will be prepared over the next 18 months and, as with all properties, the VOA will first search for evidence of rents paid on sports grounds as a guide to value. As I have explained, to be good evidence these rents will have to reflect the value to the sports club. These rents should not reflect matters such as the development value where, for example, the club happens to be in a prosperous area. To the extent that the rental evidence, where available, shows that values have risen or fallen over the last six years, this will be reflected in rateable values at the 2023 revaluation.
The VOA expects to use rental evidence for most clubs but, whatever the valuation approach adopted for the property, the VOA is clear in its guidance that for non-commercial clubs valuers can also have regard to ability to pay before setting rateable values. The valuer should ask themselves if the rateable value represents the rent that clubs or organisations of the kind which occupy the type of sports ground concerned could reasonably be expected to pay. The VOA’s guidance specifically recognises that where income is generated from the occupation of these grounds, the costs of occupation will be barely covered despite voluntary assistance. Although I am unable to tell the noble Lord how amateur sports clubs will be impacted by the 2023 revaluation, I hope that this background to how they are valued is helpful.
The noble Lord, Lord Addington, has established to the House the vital importance of our community sports clubs. While the value of the 80% mandatory business rates relief to eligible community amateur sports clubs cannot be understated, I recognise the need for the Government to provide support beyond this, particularly throughout the duration of this pandemic. This Government’s commitment to sport is evidenced by the £220 million provided by Sport England to support community sports clubs and exercise centres since March 2020. In addition, the Government have put in place a £300 million sports winter survival package, which has been used to protect the immediate future of major spectator sports over the winter period, and a £100 million support fund for local authority leisure centres. In total, the Treasury estimates that around £1.5 billion of public money has gone into sports in the last year. I hope the House will agree that this constitutes a significant package of support that this Government have made available to sports clubs and exercise facilities of all sizes.
I hope that I have given the House some assurances about both the financial support that the Government are providing to our grass-roots sports sector, and the process and approach which will be taken over the coming months as amateur sports clubs are revalued by the VOA. We will continue to keep in mind the points on how we can support community sports at the grass-roots level. I appreciate the passion from both the noble Lord, Lord Addington, and my noble friend Lord Moynihan, but, reluctantly, I cannot tear up my speaking notes. Therefore, I hope that with these reassurances the noble Lord, Lord Addington, will agree to withdraw his amendment.
My Lords, I thank noble Lords who have spoken in support of us, particularly my friend in sport, although I prefer “collaborator”. I thank the Minister for his reply about the current system and for saying that if you have done the right thing, you will get some benefit out of it. That is fair enough, as such things are fairly hard won in the first place. The noble Lord, Lord Rooker, had a chat about the creation of community amateur sports clubs—a conversation which, I believe, the noble Lord, Lord Moynihan, and I were both in on, in the Moses Room. Civil servants were more or less told to go back and think again, so a precedent has been set that should perhaps be looked at at some point. These groups do good things and do the Government’s job for them.
My amendment also mentioned physical, recreational and cultural activities. We did not really get round to them in the debate but they are also important. Maybe we should think about dance classes, local am dram and music group facilities as well. The Minister has acknowledged that the Government as a whole have a responsibility here. It is not something that can be pushed off to health, DCMS, education or meetings at junior functionary level, and then be ignored; it is a priority. The most important point here is that the Government as a whole should support this as it does their work for them in many fields. I do not think there is much dispute about that.
However, if rates is not the way forward, I look forward to dragging out of whoever happens to be sitting where the Minister is now how they are going to do it and combine the various areas, because that is the important thing to come out of this. Having said that, I beg leave to withdraw my amendment.
Amendment 2 withdrawn.
Arrangement of Business
My Lords, the Hybrid Sitting of the House will now resume. I ask all Members to respect social distancing. For the debate on the Motion to approve the Health Protection (Coronavirus, Restrictions) (All Tiers and Self-Isolation) (England) (Amendment) Regulations 2021, the time limit is one and a half hours.
Health Protection (Coronavirus, Restrictions) (All Tiers and Self-Isolation) (England) (Amendment) Regulations 2021
Motion to Approve
That the Regulations laid before the House on 29 January be approved.
Relevant document: 45th Report from the Secondary Legislation Scrutiny Committee