Monday 20 November 2023
Business and Trade
UK-Gulf Co-operation Council Free Trade Agreement
The fifth round of negotiations for a free trade agreement between the UK and the Gulf Co-operation Council took place between 5 and 16 November.
The round was hosted by the GCC in Riyadh and held in a hybrid fashion. A number of UK negotiators travelled to Riyadh for in-person discussions, with others attending virtually.
Draft treaty text was advanced across the majority of chapters. Technical discussions were held across 21 policy areas over 40 sessions. Good progress was made and both sides remain committed to securing an ambitious, comprehensive and modern agreement fit for the 21st century.
An FTA will be a substantial economic opportunity and a significant moment in the UK-GCC relationship. Total trade was worth £61.5 billion according to latest figures.
The sixth round of negotiations is expected to be held in the first quarter of 2024.
His Majesty’s Government remain clear that any deal signed will be in the best interests of the British people and the United Kingdom economy.
Advanced Manufacturing: Funding
On Friday 17 November, the Government announced £4.5 billion in funding for manufacturing to support private sector investment in eight strategic sectors across the UK. Together with our existing manufacturing support and plans for the net zero transition, the funding will level up communities across the country with higher-paid jobs and improve our energy security.
The funding will be available for high-quality proposals from 2025 for five years and therefore help unlock private investment by providing longer-term certainty. It is targeted at the UK’s strongest, world-leading sectors, and where the industry is undergoing fundamental changes as the world transitions to net zero.
Over £2 billion has been earmarked for the automotive industry, supporting the manufacturing and development of zero-emission vehicles, their batteries and supply chain.
The sum of £975 million has been earmarked for aerospace, supporting investment in energy-efficient and zero-carbon aircraft equipment.
Further, we have committed to £960 million for a green industries growth accelerator to support clean energy manufacturing, and £520 million for life sciences manufacturing to build resilience for future health emergencies and capitalise on the UK’s research and development strengths.
The green industries growth accelerator investment will support the expansion of strong, homegrown, clean energy supply chains across the UK, including: carbon capture, utilisation and storage; electricity networks; hydrogen; nuclear; and offshore wind. This will enable the UK to seize growth opportunities through the transition to net zero, building on our world-leading decarbonisation track record and strong deployment offer.
More information, including on the application processes, will be made available by the Government in due course.
The funding forms part of the Prime Minister’s pledge to grow the economy, and his focus on making decisions for the long term. It does not just focus on the most successful sectors today but looks ahead to how we keep pace internationally and build the UK’s expertise for the industries of the future. The funding will also help to ensure that the UK remains at the forefront of the global transition to net zero and can seize growth opportunities in the new green economy.
This approach is part of the UK’s wider offer for advanced manufacturing. The Government have also published Professor Dame Angela McLean’s pro- innovation regulation of technologies review on advanced manufacturing and the Government’s response, and announced commitments to extend the connected and automated mobility research and development programme and expand the Made Smarter adoption programme for manufacturing SMEs. The Government will shortly set out more on their actions to support investment and growth in the manufacturing sector with the publication of the advanced manufacturing plan and UK battery strategy.
Investment Zones and Freeports
The Government are announcing that the investment zones programme in England will be extended from five to 10 years. Each investment zone will be provided with a £160 million envelope from 2024-25 to 2033-34, which can be used flexibly between spending and tax incentives, subject to ongoing co-design of proposals and agreement of delivery plans with the Department for Levelling Up, Housing and Communities and His Majesty’s Treasury.
The Government are also announcing that the window to claim freeport tax reliefs in England will be extended from five to 10 years until September 2031, conditional on each freeport developing a satisfactory delivery plan agreed by the Department for Levelling Up, Housing and Communities and HM Treasury. This extension will provide long-term support to businesses looking to invest, delivering growth and jobs, and levelling up the country.
The Government will work with the Scottish and Welsh Governments with the intention of delivering the same extension for freeports and investment zones in Scotland and Wales, and will continue to work with stakeholders on how best to deliver the benefits of the investment zones and freeports programmes in Northern Ireland.
Alongside this, the Government and the West Yorkshire Mayoral Combined Authority have jointly announced that the West Yorkshire investment zone will focus on life sciences, and digital and tech, building on existing local strengths in these sectors. This will bring benefits to local communities and businesses across West Yorkshire, including in Huddersfield, Bradford and Leeds.
Paxman Scalp Cooling, a pioneering health tech company, and digital healthcare company Dedalus have committed the first new investments into the investment zone worth a total of £26 million. Paxman Scalp Cooling is investing £5 million to bring its innovative health tech products to global markets and Dedalus is investing £21 million to deliver digital and diagnostic tools for the NHS.
Building on the region’s research strengths and its existing base of businesses in life sciences, digital and technology, the West Yorkshire investment zone will bring opportunity into areas that have historically underperformed economically through a total funding envelope of £160 million over 10 years. It is expected that the investment zone will help leverage more than £220 million of private funding and help support more than 2,500 jobs over the next five years.
The Government and the West Yorkshire Mayoral Combined Authority will continue to work together on the investment zone to jointly agree the outstanding elements of the programme, including the breakdown of how West Yorkshire’s envelope will be deployed, with a view to setting out further details in due course.
Foreign, Commonwealth and Development Office
International Development White Paper
In 2015, the world gathered at the United Nations to agree the sustainable development goals—a development framework for people, planet, prosperity, peace and partnership for development to 2030. Now at the mid-point of the SDGs, and in a more divided world, this development progress is at risk of reversal. Only 15% of the SDG indicators are due to be met. The covid pandemic, the rise in conflict and instability, food insecurity caused by Russia’s illegal invasion of Ukraine, as well as the impacts of climate change and biodiversity loss and the lack of affordable finance, are all examples of the resounding challenges we now collectively face in delivering the SDGs.
Today the Government have published an international development White Paper that makes a powerful and I hope persuasive case for a renewed global development partnership and a reinvigorated role for the UK in delivering the SDGs.
The global context for development has changed. The UK’s approach to development needs to change with it. Developing countries want and need a different development offer, based on mutual respect, powered by development finance at scale, and backed by a more responsive multilateral and international system. This White Paper is our pledge to take a patient, partnership-based approach to development—an approach that looks ahead to the longer-term challenges we face and can readily adapt to the ongoing global changes confronting us. We will bring together a whole-of-UK effort, capitalising on the integration of our diplomacy and development expertise, to achieve greater impact and address the links between extreme poverty and climate change effectively.
In this spirit, the White Paper has been built on extensive consultation: here, in the UK, with right hon. and hon. Members across this House—foremost with the International Development Committee—and the other place; with our charity sector, of course; with academia; with business; and with our global partners. It sets out a road map that galvanises progress in tackling the universal challenges of poverty, climate change, insecurity, and delivering sustainable growth and wellbeing for all, and we will see a step change in the domestic understanding and support for this work. Similarly, it should help spur action internationally. This paper is built on listening to and drawing on the voices of our friends all around the world. It is clear that trust has weakened; and only by listening and acting can we start to rebuild it.
We have set out seven priorities in the White Paper. These priorities matter to our partners and we consider them to be critical in achieving the SDGs through collective global efforts.
First, we must mobilise more money and impact from international financial institutions and increase private sector investment in development to end extreme poverty, tackle climate change and power sustainable growth.
We must reform and strengthen the international system to improve action on trade, tax, debt and tackling dirty money, and deliver on global challenges. We must ensure that the multilateral system is more responsive, inclusive and effective.
We must tackle climate change, biodiversity loss and their impacts, while delivering sustainable growth and economic transformation.
We must ensure opportunities for all, putting women and girls centre stage, and investing in education and health systems that societies want, while also standing up for our values, for open, inclusive societies, and preventing the roll-back of rights.
We must tackle conflict, disasters and food insecurity, anticipating and preventing conflict and humanitarian crises while building resilience and enabling adaptation for those affected by disasters and climate shocks, and strengthening social protection and disaster risk financing.
Lastly, we must harness innovation and digital transformation, making best use of new technologies, science and research to deliver the greatest and most cost-effective development impact.
The White Paper explains how we will advance all seven of these priorities.
We believe that a world where developing countries are more resilient, more prosperous and secure is in everyone’s interests. Global development co-operation is essential to achieve this vision. Together with our partners, we will get the SDGs back on track to 2030. The White Paper sets out our commitment to do so.
Health and Social Care
Voluntary Scheme for Branded Medicines Pricing, Access and Growth
I am pleased to inform Parliament that agreement has been reached on a Heads of Agreement for the 2024 Voluntary Scheme for Branded Medicines Pricing, Access, and Growth (VPAG). This is an agreement between the Department of Health and Social Care—representing the UK Government, the Governments of Scotland and Wales and the Northern Ireland Department of Health—NHS England and the pharmaceutical industry, represented by the Association of the British Pharmaceutical Industry (ABPI).
This is an important milestone in the agreement of a new scheme. Once the Heads of Agreement has been formalised in a full scheme document, the 2024 VPAG will operate for five years starting from 1 January 2024, when the current scheme ends.
The 2024 VPAG stands to deliver savings to the NHS across the next five years, rapid patient access to new clinically and cost-effective medicines, and a sustainable approach to medicines provision.
The proposals also demonstrate the Government’s commitment to supporting a strong UK life sciences industry to drive economic growth, including through the establishment of a £400 million fund to support investment in the UK life sciences ecosystem, including improved clinical trial capacity.
Productivity in Policing
I am pleased to announce the publication of the independent Policing Productivity Review.
In August 2022, the Home Office commissioned the National Police Chiefs’ Council (NPCC) to conduct an independent review of productivity in policing. The report was commissioned to provide clear, practical, and deliverable recommendations to improve efficiency and effectiveness across the functions of policing. I am happy to advise the House that the review team have now provided their report to the Home Office.
While we are still considering the recommendations made in the report, I am supportive of any efforts to identify opportunities to increase productivity within policing, reducing unnecessary burdens on police officers’ time and freeing up their time to do the frontline work of protecting the public and catching criminals.
The report has identified many opportunities for making improvements, both long and short-term, and the Home Office will now consider these recommendations in more detail, engaging with policing and other key stakeholders, as we prepare to give a full response in the New Year.
I am looking forward to working with policing to make the changes necessary to unlock the full potential of the opportunity provided by the review.
A copy of the Policing Productivity Review will be placed in the Libraries of both Houses and is available at www.gov.uk.
Levelling Up, Housing and Communities
Election Finance Regulation
In July 2023, the Government confirmed their intention—20 July 2023, Official Report, HCWS985—to proceed with uprating reserved and excepted party and candidate spending limits and donations thresholds to reflect historic inflation in the years since the respective limits were set. The intention to review these thresholds was set out in December 2020, and the Westminster Parliamentary Parties Panel was consulted in September 2022. This is a necessary action as many of these statutory limits, set in absolute terms, have not been uprated for over 20 years.
Today, the Government have uprated in line with inflation the expenditure limits for candidates and registered political parties at UK parliamentary elections, Northern Ireland Assembly elections and local government elections in England. The same statutory instrument also uplifts the reporting thresholds for donations and regulated transactions for political parties, regulated donees, permitted participants at relevant referendums and unincorporated associations making political contributions. These changes are made through the Representation of the People (Variation of Election Expenses, Expenditure Limits and Donation etc. Thresholds) Order 2023.
The lack of change in absolute terms impacts campaigning ability, given the increased costs of printing, postage and communication, which is vital for parties and candidates to engage with voters. For example, a second-class stamp cost 19p in 2000; it is 75p today.
Parliament anticipated this, which is why the legislation allows for these limits to be adjusted to account for inflation. The Government’s policy is now to increase them so that they are the same in real terms as the original limits set by Parliament.
It has been more than a decade since the donation reporting thresholds were last uprated—by the last Labour Government—in 2009, following their introduction in 2000. If these limits are not uprated from time to time, the effect is to cut the thresholds in real terms. The principle of a threshold for publishing donations was established following the report by the Committee on Standards in Public Life—the “Neill Committee”—on the funding of political parties in 1998 (Cm 4057), noting the need to balance privacy and transparency. The Labour Government’s response in 1999 (Cm 4413) agreed with this principle.
The purpose of these reporting thresholds is to provide transparency around the granting of larger donations, balanced with the administrative burden such reporting may create for the recipient and with the privacy of smaller donors. Uprating these thresholds will ensure that balance is maintained in line with the original policy and legislative intent of Parliament when setting the thresholds. Again, there is no change in real terms.
The Government have decided not to increase the £500 threshold relating to the point at which a financial contribution is considered a regulated donation and subject to permissibility checks. This approach will ensure that the checks on the permissibility of donations and donors remain as they do now, and reflects the broader stance the Government have taken to prevent foreign interference in elections.
The substantive provisions on donation reporting thresholds come into force from 1 January 2024 to align with the reporting year for political parties.
The Government have also made the Police and Crime Commissioner Elections (Amendment) Order 2023. This delivers the uprating of spending limits for candidates standing at police and crime commissioner elections. These limits have not changed since they were first set in 2012, which has the effect of reducing the spending limits in real terms. The order will be laid before Parliament and will come into force on 12 December, subject to annulment in pursuance of a resolution of either House.
Further secondary legislation will follow in due course, to complete the delivery of spending limits uprating—for local councils, combined authorities and the Greater London Authority—and to deliver the Government’s commitment to exempt reasonable security-related expenses from contributing to election spending limits.
None of these reforms costs taxpayers money. Indeed, in Britain, taxpayers do not have to bankroll political parties’ campaigning. Political parties have to raise money themselves, while following transparency and compliance rules laid out in law. Those who oppose party fundraising need to explain how many millions they want taxpayers to pay for state funding instead.
The Government will further engage with the Parliamentary Parties Panel and the Electoral Commission to ensure that those affected are aware of these changes.
Taken together, the measures will support continued democratic engagement by political parties and candidates; and facilitate continued freedom of political expression and association, whilst ensuring our elections remain free and fair.
Levelling-up Fund: Third Round
I am delighted to announce that £1 billion will be allocated to 55 projects as part of the third round of our flagship Levelling-Up Fund.
Listening to feedback from parliamentarians and local government, including in relation to the first two rounds of this fund, we decided not to run an additional competition. We received 529 bids in round two, of which 111 were awarded funding at the time, with a further 19 projects funded separately at spring budget. For round three, we have drawn on this impressive pool of existing bids which we were not able to fund earlier in the year but were assessed as high-quality and ready-to-deliver. We will work closely with local authorities to ensure that the projects allocated funding can make a difference to communities as quickly as possible.
We have targeted funding at the places most in need across Great Britain, as assessed through our Levelling Up Needs metrics, which take into account skills, pay, productivity and health. We have also taken care to ensure that every part of Great Britain benefits from this round of funding, from Bolton to Elgin, and Newcastle to Rhyl.
Since 2021, the Levelling-Up Fund has played an important role in driving prosperity and pride in place in communities across the country. Across the first two rounds of the Fund, £3.8 billion has been awarded to 216 projects which are well underway. The Levelling-Up Fund also continues to play a key role in helping to reduce geographical disparities across the United Kingdom. Over the lifetime of the Fund, we have exceeded our original commitment of awarding £800 million to Scotland, Wales, and Northern Ireland.
To this end, the third round of the Fund will see £122 million awarded to six projects in Scotland, such as £14 million to improve Dumfries and Galloway transport and £15 million to regenerate Drumchapel Town Centre in Glasgow. In Wales, we have awarded a further £111 million to seven projects, including £20 million to regenerate Barry town centre and £27 million to Neath Port Talbot across two projects. In England, Yorkshire and Humber and the North West will receive the most funding per head, with exciting projects like the £48 million upgrade to the Penistone Rail Line in West Yorkshire, and the £20 million Town Centre Improvements and Civic Square Development project in Chorley, receiving funding in this round.
In Northern Ireland, given the current absence of a working Executive and Assembly, the Government are not proceeding with this round of the Levelling-Up Fund at this time. We will continue to work closely with projects and places in Northern Ireland that were awarded a total of £120 million in the first two rounds of the Fund.
A full methodology note has been published for the third round of the Fund and we have notified all relevant local authorities of their awards. I will place a copy of the methodology note in the House Library.
Network North: Highways Maintenance Funding
I am pleased to inform the House that my Department last week published details of the very significant £8.3 billion extra funding for local road resurfacing which will lead to a long-term, unprecedented transformation in the condition of our highways. Local highway authorities across England are set to benefit from the biggest ever road resurfacing programme to improve local roads.
The funding is part of the Network North plan to improve journeys for all and provides long-term certainty to local authorities. In keeping with the Prime Minister’s commitment, all moneys previously allocated for the north and midlands will still be allocated there, with moneys from savings at Euston being spent across England, with the funding broken down as follows:
£3.3 billion for the north of England
£2.2 billion for the midlands
£2.8 billion for east, south-east (including London) and south-west England.
This funding is in addition to local transport funding from the last spending review and additional to what local transport authorities were expecting in future. Allocated across the next 11 years, it will represent a more than two-thirds increase in Department for Transport support for local roads. Fifteen per cent of the funding will be allocated at a later date to allow a degree of flexibility over how best to support highway maintenance initiatives across England.
Of the new funding, £150 million is being made available in each of the financial years 2023-24 and 2024-25, with the lion’s share to follow over the remainder of the 11-year period. This provides time for local authorities and their supply chains to ramp up to deliver an increase in funding of this significance. Details of what each local highway authority will receive are published on gov.uk.
To ensure that the funding delivers a transformational improvement in the condition of local roads and to allow a greater degree of public scrutiny over how it is spent, the Department is introducing new reporting requirements on local authorities. These include that all local authorities receiving this funding should:
Publish by March 2024 a summary of the additional resurfacing work they will deliver with the new funding over the next two years.
Thereafter publish quarterly reports summarising what additional work they have done and which roads have been resurfaced.
Publish later in 2024-25 a long-term plan for their use of the full 11-year funding and the transformation it will deliver.
This is transformative funding which directly demonstrates the benefits that will be felt right across England for all road users, who will enjoy smoother, faster and safer trips, funded from the difficult but necessary decision to cancel HS2 phase 2.
Work and Pensions
Health and Disability White Paper
I would like to update the House on the progress of a number of tests and trials set out in “Transforming Support: The Health and Disability White Paper”, which was published in March this year.
Our ambitious White Paper plans are part of our next generation of welfare reforms and will transform the health and disability benefits system. This includes supporting more disabled people and people with health conditions to start, stay and succeed in work, and making improvements to the benefits system so that people have a better overall experience when applying for, and receiving, health and disability benefits.
Among the White Paper initiatives under way, six test new and innovative ways to deliver our goals, responding to views we heard through the Green Paper consultation.
First, the employment and health discussion is a voluntary service available to claimants with a disability and/or long-term health condition, and is a discussion with a claimant about their health situation, any barriers it presents in moving towards work, and how to overcome them. The EHD is not part of the assessment process and takes place before the work capability assessment. It began as a small-scale test in Leeds health model office in 2022, with employment and health practitioners seconded to the Department for Work and Pensions from Maximus, which operates the Centre for Health and Disability Assessments.
I am pleased to update the House that from October this year, after a positive initial evaluation, we have expanded the test to 13 sites across England and Wales. With the support of Maximus, we have further grown our team of employment and health practitioners.
Secondly, the White Paper also set out our plans to test a severe disability group for claimants who have conditions that are severely disabling, lifelong, and with no realistic prospect of recovery. The SDG will provide these claimants with a simpler gateway to access benefits, identifying them at the start of the assessment process and removing the need to complete a detailed form or undertake a face-to-face, telephone or video assessment.
Our testing plans are progressing, following positive engagement with Blackpool Teaching Hospitals NHS Foundation Trust. We will test the SDG and its criteria in several specialist clinical areas in secondary care at Blackpool Teaching Hospitals. The British Society of Physical and Rehabilitation Medicine has also agreed to work in partnership to test the SDG. We expect to start generating referrals in the coming months.
Thirdly, we have started a small-scale test, matching personal independence payment, universal credit and employment and support allowance claimants’ primary health conditions to an existing assessor with professional experience of supporting people with that condition. This is taking place in health transformation area sites in London and Birmingham.
We want to understand whether claimants view this different approach positively and if it improves their trust in the assessment process. This test is scheduled to run until January 2024, at which point we will review our learning from the test and consider possible next steps.
Fourthly, the enhanced support service provides bespoke personalised support for people who find it hardest to use the benefits system. It provides practical support to these claimants—for example, by helping them to fill in forms, submit medical evidence and attend health assessments—as well as signposting to appropriate wider support. Testing is ongoing in East Anglia, Kent, Blackpool and Birmingham.
Through our fifth test, we are exploring options to introduce a new way of gathering evidence of fluctuation in a person’s condition before their assessment.
Some stakeholders have advised that current assessments do not always fully capture the impact of fluctuating conditions and that it can be difficult for some people with fluctuating conditions to answer questions about how their condition impacts them for the majority of the time.
We are in the early stages of testing a health impact record as a structured way to present evidence that demonstrates the changing impact of applicants’ health conditions.
Finally, the health assessment channels trial is nearing completion. Following the introduction of phone and video assessments, we have been analysing whether there is a difference in award outcomes for assessments completed remotely, compared to face to face. We have also been conducting research to gain an understanding of claimant experience by different channels.
Evaluation is taking place across all tests and trials to develop our evidence base, inform wider implementation, assess value for money and determine next steps.
We will continue to discuss progress with the devolved Administrations.
We are also committed to continue listening to and working with disabled people and people with health conditions, organisations, charities, business and other experts, as we develop our plans and continue the tests and trials I have set out today.
We have made good progress since the publication of the White Paper. These improvements will ensure that disabled people, and people with health conditions, can access the right support at the right time, and lead independent and fulfilling lives.