Thursday 23 September 2021
Business, Energy and Industrial Strategy
Flexible Working and Carer's Leave
The Government have today published a consultation on flexible working and the response to our consultation on a new right to time away from work for unpaid carers. These deliver on commitments in our manifesto and are an important part of our drive to build back better after the pandemic, deliver for working families by helping people to access and stay in work, and improve business productivity.
Flexible working consultation
This consultation considers measures to increase the availability and uptake of the full range of flexible working options—whether that is a part-time or job-sharing working arrangement, flexing working hours or working remotely—freeing employers and employees alike from the default nine-to-five model.
The consultation proposes that every employee in Great Britain is given the right to request flexible working, regardless of time served, under our plans to modernise the way we work and improve business productivity.
Under the proposals—which would see around 2.2 million more people given the right to request flexible working—employees would also be able to make more than one request for flexible working each year, and the current three-month period an employer has to consider each request would be shortened.
If an employer is unable to accommodate a request, our consultation proposes that they would need to consider what alternatives they could offer. For example, if they couldn’t change their employee’s hours on all working days, they could consider making the change for certain days instead.
There is no “one size fits all” approach to working arrangements. While certain ways of working may suit some employers and employees, they will not suit everyone. Therefore it is important that Government do not prescribe specific arrangements in legislation. Instead, these proposals would provide a strengthened legislative framework that encourages conversations around flexible working to be more two-sided. They are designed to balance the needs of employee and employer, and encourage all parties to focus on what may be possible, rather than what is not.
Empowering workers to have more say over where and when they work makes for more productive businesses, and happier employees. Flexible working allows employees to balance their work and home life: including helping people manage childcare commitments or other caring responsibilities. It can also be key to ensuring that people who are under-represented in the workforce, such as new parents or disabled people, have access to more employment opportunities.
Alongside clear benefits to workers, there is a compelling business case for flexible working. Benefits include:
Attracting top talent—Research conducted by Timewise, a flexible working consultancy, has shown that 87% of people want to work flexibly, rising to 92% for young people.
A highly motivated, productive workforce—Research published by HSBC shows that nine in 10 employees consider flexible working to be a key motivator to their productivity at work—ranking it as more important than financial incentives. Employers have reported seeing improvements in staff motivation and employee relations.
A better business environment—the CBI employment trends survey found that 99% of all businesses surveyed believed that a flexible workforce is vital or important to competitiveness and the prospects for business investment and job creation.
For both these individual and business reasons, the Conservative party’s 2019 manifesto committed to a consultation on measures to help make flexible working the default unless employers have good reasons not to. Today's publication delivers on that commitment. It also contains our response to measures in the July 2019 “Good Work Plan: proposals to support families” consultation on publishing flexible working and family-related leave and pay policies; and stating whether jobs may be open to flexible working in the advert.
While the consultation focuses on contractual flexible working arrangements, the Government recognise that people do not always need something so formal to help them balance their home and work life. The consultation therefore also sets out our future plans for a call for evidence on how to support more “ad hoc” and informal forms of flexibility, for example to attend a one-off appointment.
The territorial extent of the proposals included in this consultation extends to England, Wales, and Scotland (employment law is devolved to Northern Ireland).
The consultation runs for 10 weeks until 1 December 2021. I will place copies of the flexible working consultation in the Libraries of both Houses.
Government response to the carer’s leave consultation
The Government have also today published their response to the consultation on carer’s leave.
Around five million people across the UK are providing unpaid care by looking after or helping a family member, relative or friend. Nearly half do this while also working full-time or part-time. Juggling caring responsibilities and work can be challenging and can limit the participation of unpaid carers in the labour market. Women, who are often still the primary carers within families, tend to be disproportionately impacted.
The 2019 manifesto committed to introduce an entitlement to one week of leave for unpaid carers. This was followed, last year, by a consultation on carer’s leave, which recognised that unpaid carers face particular challenges in balancing work and caring responsibilities that may warrant a specific new employment right to time off from work.
The response, published today, sets out key aspects of the leave entitlement, including:
Employees with caring responsibilities for a dependant with long-term care needs will be entitled to one working week of unpaid carer’s leave (per employee, per year).
This new right will be available from the first day of employment.
Eligibility for the new right, both in terms of who the employee is caring for and how the leave can be used, will be broadly defined.
The leave can be taken flexibly (i.e. from several half day blocks to a single block of whole week).
The entitlement has been designed to balance the needs of employers and employees, ensuring that employers are able to plan and manage the absence created by carer’s leave. These include a minimum notice period and enabling employers to postpone (but not deny) the request for carer’s leave where the employer considers the operation of their business would be unduly disrupted.
The territorial extent of the proposals included in this Government response to the consultation on carer’s leave extends to England, Wales, and Scotland (employment law is devolved to Northern Ireland).
I will place copies of the carer’s leave consultation response in the Libraries of both Houses.
Infected Blood Compensation Framework Study: Terms of Reference
On 20 May my predecessor, my right hon. Friend the Member for Portsmouth North (Penny Mordaunt), announced the appointment of Sir Robert Francis QC to carry out an independent study to look at options for a framework for compensation for victims of infected blood. The study will make recommendations for compensation, before the infected blood inquiry reports. Terms of reference of the study were to be finalised following consultation between Sir Robert and those infected and affected. The consultation period concluded in August, and Sir Robert wrote to my predecessor with his recommendations.
Sir Robert’s consultation received a positive response from the infected and affected community. A total of 447 formal responses were submitted (including from many of the legal representatives of infected and affected core participants of the inquiry), along with over 150 further representations, primarily personal accounts from the infected and affected on how this tragedy has affected their lives. These accounts were of great assistance to Sir Robert in reviewing the draft terms of reference. Sir Robert wishes to express his gratitude to the many individuals who contributed to the consultation, in many cases having to relive the awful experiences they have suffered over so many years, and I would like to echo his gratitude.
Sir Robert’s recommendations identify the key issues that the study should consider. They offer assurance to the infected and affected communities that the matters of most concern to them will be considered by the study. I am therefore happy to accept Sir Robert’s recommendations in full, and I am today publishing the following terms of reference without amendment:
Rationale for compensation
To consider the rationale for compensation as a matter of general principle and in relation to any particular classes of compensation, recognising that it is not for the study to pre-empt the determination by the infected blood inquiry as to what, if any, rationale is supported by the evidence it has received;
Independent advice to the Government
Give independent advice to the Government regarding the design of a workable and fair framework for compensation for individuals infected and affected across the UK to achieve parity between those eligible for compensation regardless of where in the UK the relevant treatment occurred or place of residence. While the study is to take into account differences in current practice and/or law in the devolved Administrations, it is not asked to consider whether delivery of that framework should be managed centrally or individually by the devolved Administrations;
Scope of compensation
To consider the scope of eligibility for such compensation (including the appropriateness or otherwise of any conditions such as “cut-off” dates), and whether it should be extended beyond infected individuals and their partners, to include for example affected parents and children, the wider affected family (e.g. siblings), and significant non-family carers and others affected, either because of the impact of caring responsibilities or the effects of bereavement or some other impact; to include consideration of former and new partnerships/marriages; and whether the estate of any individual who has died should be eligible for compensation;
Categories of injury and loss
To consider the injuries, loss and detriments that compensation should address, in relation to the past, present and future, including:
(a) the physical impact and consequences of infections (including the effect of any treatment, and potential future adverse effects);
(b) infections that cleared naturally; and the risk of any significant or long-term side effects of treatment (such as liver damage, increased risk of cancer) even if they are yet to materialise;
(c) the mental health, social and financial impacts (including access to financial services)—both actual and in terms of loss of opportunities—suffered by both the infected and affected; and
(d) other types of loss if appropriate;
Types of award and method of assessment
(a) the extent to which any framework should offer compensation on the basis of an individualised assessment and/or fixed sums or a combination of these (including consideration of the position of an individual who was both infected, and affected by another individual’s infection);
(b) whether awards should be by way of final lump sums, periodical payments or both;
(c) whether an individual should be required to prove matters (if so what types of matters, by what means, and to what standard);
(d) whether there should be any limitation by way of time or other bar on entitlement or claim, and whether any existing time bars should be maintained;
(e) the extent to which compensation should be limited to matters currently recognised by the law (taking into account any differences in the law across the UK) on damages and evidence as recoverable for the purposes of compensation, or, if not, the basis on which broader matters should be taken into account;
Measures for compensation
To consider the measures for compensation, looking at other national schemes (for example, the compensation tribunal established in the Republic of Ireland) to examine their merits or otherwise, and experiences, both as to form (i.e. administration/process) and the substance of compensation;
Relationship with current schemes
To consider the relationship between a compensation framework and other receipts and payments by individuals, including: (a) the pre-existing financial support schemes; (b) legal claims; (c) welfare benefits and tax;
Options for administering the scheme
To consider options for administering the scheme (including but not limited to what bodies, organisations or tribunals might need to be established to facilitate such administration); what principles, aims or criteria etc might underpin the development of an appropriate scheme; and any ancillary matters which should be considered such as interim payments, publicity of the scheme, outreach to potential claimants, and support;
To consider other issues that, in the course of his investigations, Sir Robert considers relevant; and
Reporting to Government by February 2022
To submit to the Government its report and recommendations as quickly as possible and no later than the end of February 2022, to provide the Government with advice on potential options for compensation framework design.
Sir Robert and his team will now begin the more detailed conversations and analysis to look into the detail of the issues raised by the infected and affected community. This will allow him to produce a set of comprehensive recommendations to the complex issues involved.
I, like my predecessor, am deeply committed to ensuring that Sir Brian Langstaff’s independent public inquiry has all the resources it needs to complete its work; in Sir Brian’s words, “as quickly as thoroughness permits”. The infected blood scandal continues to claim the lives of infected people, and those directly affected have waited too long for answers, and for justice.
Agreement Between British Trade and Cultural Office and Taipei Representative Office
A protocol to the agreement with the Taipei Representative Office in London was signed in London on 11 August and in Taipei on 19 August. The text of the protocol is available on HM Revenue and Customs’ pages of the gov.uk website and will be deposited in the Libraries of both Houses. The text of the protocol will be scheduled to a draft Order in Council and laid before the House of Commons in due course.
UK National Risk Assessment of Proliferation Financing
As a major global financial centre, a key component of the UK’s economic strength and prosperity is our openness to investment and trade. However, this quality also makes the UK economy vulnerable to illicit finance activities, including proliferation financing. Despite robust controls in place in the UK to tackle proliferation financing activity, actors involved in proliferation financing look to exploit the UK’s position in the global economy and international financial system to raise funds to develop chemical, biological, radiological, and nuclear (CBRN) programmes which counter UK national security objectives and threaten international peace and security.
On 23 September, the Government published the UK’s first national risk assessment (NRA) of proliferation financing risks. This assessment, published by HM Treasury using views and evidence from Government, the private sector, and academic and research partners, provides a comprehensive review of the proliferation financing risks facing the UK. The UK is one of the first jurisdictions to carry out an assessment of this kind.
The key findings of the UK national risk assessment of proliferation financing are:
The UK’s financial sector is at high risk from proliferation actors. It is highly likely that proliferation actors will target the UK to gain financing for CBRN proliferation despite the robust controls in place to prevent this. The UK’s financial services industry, particularly the banking and insurance sectors, is especially at risk.
The Democratic People’s Republic of Korea (DPRK) and Iran are the most significant proliferation financing actors at state level. The DPRK seeks to evade international sanctions regimes to obtain financing for its unlawful weapons of mass destruction and ballistic missile programmes, and Iran for its nuclear programme.
There is limited awareness in the private sector of proliferation financing compared to other risks, including money laundering and terrorist financing. A lack of awareness of proliferation financing in parts of the UK economy can lead to a lack of understanding of how certain industrial products, for example, may be manipulated for hostile use or for use in a CBRN programme.
Despite the above threats, the assessment highlights the robust counter-proliferation legal framework in place in the UK to protect the country from proliferation financing. The UK's autonomous financial sanctions regimes targeting CBRN proliferation, as well as UN sanctions regimes implemented in the UK, export control regimes, and other tools available to the UK Government, limit opportunities for proliferating actors to exploit the UK to obtain financing for CBRN capabilities.
The report is available on gov.uk www.gov.uk/government/publications/national-risk-assessment-of-proliferation-financing.
The national risk assessment demonstrates the UK’s ongoing commitment to counter proliferation financing, set out in the integrated review of security, defence, development, and foreign policy 2021. We also committed to publishing a proliferation financing NRA in the Government’s economic crime plan. Moreover, the UK is at the forefront of international efforts to counter proliferation financing, particularly at the Financial Action Task Force (FATF) where we have led progress on updating FATF recommendations focusing on proliferation financing.
This is the first NRA the UK has produced evaluating the threat posed by proliferation financing. Under proposed amendments to the Money Laundering, Terrorist Financing, and Transfer of Funds (Information on the Payer) Regulations (MLRs), HM Treasury will be required to review and update this NRA on a regular basis. This would offer opportunities to further refine the assessment and its methodology going forward and ensure that the UK is proactively seeking to address new threats and trends posed by proliferation financing. In this proposed amendment of the MLRs, which is currently out for public consultation until October 2021, the Treasury also plans to set requirements on relevant persons to take appropriate steps to identify and assess the risks posed by proliferation financing, and to establish strategies to mitigate and manage these risks effectively. The findings of this assessment will also provide the UK with further opportunities to develop its counter-proliferation financing policy.
Making Tax Digital
The Government have set out an ambition to become one of the most digitally advanced tax authorities in the world.
Making tax digital (MTD) is the first phase of our move towards a modern, digital tax service fit for the 21st century. It supports businesses through their digitisation journey and provides a digital service that many have come to expect in their everyday lives. MTD helps businesses reduce common errors in their tax affairs and allows for better customer interaction and guidance through digital prompts and nudges.
Since the introduction of MTD for VAT in 2019, over 1.5 million businesses have joined and many are already experiencing benefits. MTD users are reporting that preparing and submitting returns is easier, and that MTD has increased their confidence in managing tax affairs and using technology. MTD also puts businesses on a path to further digitisation: integrating tax management with a range of business processes can contribute to productivity gains.
During the pandemic, UK businesses increasingly turned to digital tools to communicate remotely and work collaboratively. Businesses adapted rapidly to the challenges posed by the pandemic, using digital solutions to maintain resilience and reduce disruption.
Over the past year, HMRC has worked closely with partners in the business and tax communities on the proposed design and scope of MTD for income tax (ITSA).
Today the Government have laid regulations in Parliament to help those impacted by the changes to prepare, and for their representatives to develop their own support and guidance.
The Government recognise the challenges faced by many UK businesses and their representatives as the country emerges from the pandemic over the last year. In recognition of this and of stakeholder feedback, we will now be introducing MTD for ITSA a year later, in the tax year beginning in April 2024.
General partnerships will not be required to join MTD for ITSA until the tax year beginning in April 2025. The date at which all other types of partnerships will be required to join will be confirmed later.
In March 2021, the Government announced a new system of penalties for the late filing and late payment of tax for ITSA. This will now be introduced for those who are mandated for MTD for ITSA in the tax year beginning in April 2024, and for all other ITSA customers in the tax year beginning in April 2025.
Alongside the regulations, HMRC has also today published a tax information and impact note (TIIN) setting out the projected benefit and cost impacts of MTD for ITSA, as well as a policy paper to help different businesses understand what their transition to MTD could look like in more detail.
A later start for MTD for ITSA provides more time for those required to join to make the necessary preparations and for HMRC to deliver the most robust service possible, affording additional time for testing in the pilot.
HMRC will continue to work in close partnership with business and accountancy representative bodies and software developers to ensure taxpayers are well supported as they adopt MTD for USA.
The Government have also recently consulted on a reform of the complex basis period rules that govern how self-employed profits are allocated to tax years. Many respondents said that the reform was a sensible simplification but asked for more time to implement the changes. In recognition of these concerns, these changes will not come into effect before April 2024, with a transition year not coming into effect earlier than 2023. The Government will respond to the consultation in due course providing the next steps.
Foreign, Commonwealth and Development Office
NATO Parliamentary Assembly
The hon. Member for Angus (Dave Doogan) has replaced the hon. Member for Lanark and Hamilton East (Angela Crawley) as a member of the United Kingdom delegation to the NATO Parliamentary Assembly.
Machinery of Government: Department for Levelling Up, Housing and Communities
I am making this statement to bring to the House’s attention the following machinery of government change.
Responsibility for driving forward the levelling up agenda and elections and UK governance and devolution policy is being moved to create a new Department for Levelling Up, Housing and Communities. This change will embed levelling up commitments and policy on governance in the United Kingdom and elections within a single Department which already manages relationships with local communities, local government and the housing sector. Bringing these responsibilities together will allow the Secretary of State to embed ever closer working with the territorial offices and lead co-ordination with the devolved Administrations on my behalf.
The new Department will consist of staff previously employed by the Ministry of Housing, Communities and Local Government and staff from the Union and Constitution Group in the Cabinet Office in support of cross-Whitehall efforts aimed at delivering tangible improvements in every part of the UK. A levelling up taskforce has also been established which will report jointly to me and the Secretary of State for Levelling Up, Housing and Communities.