Consideration of Commons amendments and / or reasons in the Lords
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Baroness Neville-RolfeConservative- Quote
- That this House do agree with the Commons in their Amendments 1 to 11.
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- The Parliamentary Under-Secretary of State, Department for Business, Innovation and Skills and Department for Culture, Media and Sport (Baroness Neville-Rolfe) (Con)Conservative
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- My Lords, this Bill will strengthen the UK’s position as the best place in Europe to start and grow a business, and make sure people who work hard can succeed. When the Bill left this House for the other place, the noble Lord, Lord Mendelsohn, whom I see in his seat, rightly said that it was, “certainly a better Bill than the one that arrived”.—[Official Report, 15/12/15; col. 1985.] Today, we welcome the Bill back to this House with further improvements and amendments. Let me begin with the pubs provisions—always a favourite subject, since the men in my family love a pint. As part 2 of the government consultation on the Pubs Code confirmed, we do not intend to frustrate access to the market rent only option. Amendment 28 improves Clause 33 on the MRO by amending Section 43 of the Small Business, Enterprise and Employment Act to put beyond doubt that MRO will be available at rent assessment, irrespective of the level at which the rent is set. This has now been reflected in the draft Pubs Code regulations, which were laid on 14 April. These also satisfy the concerns and commitments relating to pubs made during the passage of the Small Business, Enterprise and Employment Act and at earlier stages of this Bill. In particular, on parallel rent assessment, tenants can consider tied and MRO offers in parallel. Further, we have retained all the conditions in the Act that would entitle a tenant to request the MRO option. We said we would exempt genuine franchises from MRO, and we have done just that. Similarly, we have exempted tenancies at will and other short agreements that cumulatively last for no more than 12 months from most of the other provisions of the code, including from MRO. We have enabled pub-owning businesses and tied tenants to agree to defer for up to seven years the point at which MRO is available at a rent assessment and renewal, where the pub-owning business makes a significant investment. The minimum threshold for a significant investment is set at 200% of the pub’s dry rent. Amendment 29 tidies up Clause 34, which addresses concerns that pub companies were changing their practice to avoid application of the pubs provisions in the Small Business, Enterprise and Employment Act. These amendments make it clear: first, that potential unfair business practices occurring since the Small Business, Enterprise and Employment Act was passed in March 2015 are covered; secondly, that the adjudicator will report on avoidance of both the Act and the Pubs Code; and, thirdly, that territorial extent is in line with the SBEE Act pubs provisions. The new Pubs Code Adjudicator, Paul Newby, has now been appointed and will take up post on 2 May, ahead of the Pubs Code coming into force. Mr Newby brings great experience of the sector and a reputation for professionalism. Let us give him the opportunity to show his worth. I am very pleased with the progress that we have made on pubs in both Houses and, particularly, by working with stakeholders through the Pubs Code consultation. I look forward to a final discussion next month on the draft regulations, as Parliament considers the details of the code via the affirmative procedure. The amendments in this group relating to Wales have been developed in agreement with the Welsh Government and will allow Wales to benefit from further or extended regulation-making powers in devolved areas in respect of the Regulators’ Code, the primary authority scheme and business rates. Lastly, we come to the amendments to the extent and commencement clauses. I hope noble Lords will accept my assurance that these amendments are technical and need no further debate. I commend all these amendments to the House and I beg to move.
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Lord Mendelsohn (Lab)Labour- Quote
- My Lords, I thank the Minister for the progress we have made in matters relating to pubs. Throughout the Bill’s progress, in both Houses of Parliament, we have seen the reversion of the original intention in the small business Act and have reinstated the parallel rent assessments; legislated for additional checks to ensure that pub companies do not game the code; reversed the decision to offer MRO conditional on there being an increase in rent; and ensured protection for tenants being offered investment in turn for opting out of MRO. I am tremendously grateful to the Minister for dealing with this extremely well and making sure that these amendments properly express what this House intended when it passed that amendment. I also congratulate the officials in the department, who have done a terrific job in restoring the balance that we hoped had been struck in the small business Act and making sure that these provisions are adequately catered for. We are tremendously grateful for that. We welcome these amendments, but I will raise just a couple of technical issues on which I seek some clarity from the Minister. For the draft Pubs Code that has now been published, Regulation 3 states that every time a pub tenant wishes the adjudicator to be appointed to arbitrate on an MRO dispute, they must pay a fee of £200. Also, when an arbitration goes forward, there is the possibility of costs of up to £2,000 being awarded against tenants. We understand that this is to discourage vexatious complaints, given that tenants’ conduct could result in an unreasonable increase in the costs of arbitration. However, I want to raise a couple of issues on that. First, for tenants who are unfamiliar with how the code operates, it will be very useful to get some understanding of how it would apply to a tenant calling who lacks understanding about how this is done. Is the £200 fee an automatic charge, or is there some discretion available to the Pubs Code Adjudicator on how that might be levied for any inquiries? Certainly, given the lack of full understanding of how this code works, it would be extremely unwelcome if the fee stopped tenants coming forward with legitimate concerns. Secondly, in relation to managing some of the issues around the code, obviously most tenants could not take reasonable legal advice or pay the costs of other sorts of advice. It is entirely plausible and possible that they may well add to the complication of the arbitration because they are not sufficiently skilled or sufficiently well resourced to add to the expertise that would be required to make sure that the costs can be minimised. We would hope that the Pubs Code Adjudicator would do some of those things. It would be useful, therefore, to have some sense of how these costs may act fairly rather than just as an impediment to tenants coming forward with complaints. Finally, within six months of being established, the Pubs Code Adjudicator must issue guidance on the criteria that the adjudicator intends to adopt in deciding whether to carry out investigations and on the practices and procedures that the adjudicator intends to adopt when looking at investigations. I would be grateful if the Minister could come back to this House, either in her response or in writing, about what input the Government will or could have, or what input this House could have, in this process. If there are any issues of concern with the procedures that are developed, what checks are in place to discuss and revise them, if necessary, after the Pubs Code Adjudicator delivers them?
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- Baroness Neville-RolfeConservative
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- I thank the noble Lord for his very constructive response and reiterate my thanks to all noble Lords who have engaged in this. I look forward to our further debate. On fees, the adjudicator has a power to give advice, so that will not have a charge. Once a referral is made, a fee of £200 is due. I will look further at the detail of what the noble Lord has said, in case there is something I can add. I will also write on the point that he raised about the detail of the adjudicator, so that that is entirely clear as well. I believe that the changes that we have made, as I think the noble Lord has said, to the SBEE Act legislation and to the draft Pubs Code regulations should mean that all concerned can support these measures as a balanced package to deliver greater fairness—a word that he used—in the relationship between tied pubs and the pub-owning businesses. I very much hope that the industry and the tenants can look forward to a prosperous future.
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- Baroness Neville-RolfeConservative
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- That this House do agree with the Commons in their Amendments 12 to 17.
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- Baroness Neville-RolfeConservative
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- My Lords, the Government have brought forward these amendments to establish the new Institute for Apprenticeships. We have done a lot on apprenticeships, and the results are promising. On the apprentices side, 89% of apprentices said they are satisfied with their apprenticeship, and 82% of employers said they were satisfied with their programme. To build on this, and to deliver more world-class apprenticeships, we need to support employers in maintaining the quality of their apprenticeships. A new and independent public body, the Institute for Apprenticeships, is being established to ensure the quality of apprenticeship standards across all sectors in England. Although the focus for its activities will be recommended by government annually, the institute will be free to determine its own processes and make autonomous decisions in relation to its functions, responding to employer and apprentice needs. Employer groups will continue to develop the content of standards and assessment plans. The institute will ensure that they are fit for purpose by scrutinising the standards and the plans. Sector and assessment experts, academics and others, will help the institute to carry out these functions. In addition, the institute will carry out some wider quality assurance functions, including making arrangements for evaluating the quality of the end-point assessment for apprenticeships. Our objective is to ensure, through the Institute for Apprenticeships, that quality remains at the heart of approved English apprenticeships, whether they are with the biggest international companies or in small craft businesses. Amendments 14 and 15 clarify the information that public sector organisations subject to apprenticeships targets should provide to the Secretary of State to ensure consistency and clarity of reporting. On Amendments 16 and 17, as noble Lords know, the current Finance Bill introduces the apprenticeship levy, which will fund a step change in apprenticeship numbers and quality and deliver on the commitment of 3 million apprenticeship starts by 2020. For employers to get the full benefit of the levy, we need to know what they have contributed. Data sharing between HMRC and the Secretary of State for BIS is the most effective way of doing this and the least burdensome for business. Amendment 16 will enable information held by HMRC on an employer’s levy due to be shared, so that the Government will be able to match apprenticeship funding in England to the levy payments made by each employer by creating individual employer digital accounts. Similar data-sharing powers are provided to devolved Administrations to manage their apprenticeship schemes. From April 2017, we intend to apply a 10% top-up to levy funds paid to employers’ digital accounts to spend on apprenticeship training in England. Levy-paying employers in England will therefore be able to get out more than they put in if they are committed to training apprentices—a very important principle. Amendment 17 is technical and uncontentious. I commend these amendments to the House, and I beg to move.
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Lord Stevenson of Balmacara (Lab)Labour- Quote
- My Lords, the Minister said when she introduced the first set of amendments that the Bill was now in better shape than when it started. We can all agree with that, in particular with reference to apprenticeships. These amendments fill a lacuna in the area of apprenticeships, which we pointed out in Committee and on Report. Indeed, we tried very hard to get some movement from the Government on this but were rebuffed robustly, as is the noble Baroness’s way, albeit in a very gentle and appropriate manner. Therefore, it is all the more of a pleasure to see these amendments come back, which, in some senses, begin to address some of the big issues about what we need to do as a country to ensure that the apprenticeship route for vocational education is acknowledged, and made attractive to parents and the young people who might wish to take them, as has sadly been lacking for too many years. However, there are some issues with the proposals, which I do not want in any sense to use to argue against them, but although we have some movement here there are still quite a lot of questions that have to be resolved. We will watch this with interest. I suspect—although I have no knowledge of this—that it might be something that your Lordships’ House may have to deal with as we go forward. For instance, the focus is rightly on trying to ensure that apprenticeships are of a high quality, but there is very little detail on what the new institute will do on that, and what it might not, at this stage, be appropriate to do. It has a good foundation with the people on it, but perhaps in its staffing it does not reach as far as it could towards issues that might give some reassurance that they are thinking about the quality levels. There is a problem about the age at which apprenticeships are offered. There are still too many people aged between 23 and 30 and not enough aged between 18 and 24. To what extent will the IFA have the tools to deal with that? There is an assumption throughout a lot of people’s discussions and debate about apprenticeships that the focus will be on STEM subjects. In fact, I am sure the Minister will agree that there is just as much need to ensure that we have apprenticeships across the creative and other industries which supply so much of our national growth and which are being relied on to make sure that our economy is diversified—“STEAM”, not STEM, might be a better way of putting it. In case there is any doubt about that, the “A” stands for the arts and the creative industries. These proposals do not deal with what is going to happen to our colleges. Many FE colleges are going through periodic and differential reviews and their future does not seem at all clear. They are obviously very nervous about how this will happen. Again, we would not seek to do this through the Bill, but we need more clarity about what the infrastructure that will receive the ministrations of the IFA will be able to do. Finally, the question of the vocational education and the sort of provision that is required to provide an interlacing approach for children leaving school and going on to higher and further education is not yet fully mapped out, although I am sure that the aspirations are there. We will need to spend more time on that—perhaps when the White Paper turns into a higher education Bill we will have that opportunity. However, at the bottom of all that there is a really difficult problem about productivity. The test will be, at the end of the day, whether the IFA has anything to offer us in terms of improving productivity in this country, which is sadly lagging behind our competitors. If it does, all power to it; if it does not, we may have to revisit it; but in the interim it is an exciting development, we wish it well and we welcome these clauses.
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- Baroness Neville-RolfeConservative
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- My Lords, I thank the noble Lord for his comments and for his help in filling the lacuna that he identified. I share his wish to see apprenticeships as a really attractive option for school leavers. We will be making more information available on funding and on the detail of how the new arrangements will work from next year. I hope that this will answer the noble Lord’s outstanding questions. He makes a good point about what we do for the younger apprentices and how that fits in with the older ones. I agree that while we need a focus on STEM we actually need apprenticeships right across the board and that the creative and digital industries are an incredibly important area. My friend in the other place, Ed Vaizey, slaves and steams day and night trying to ensure that that aspect is grabbed right across Whitehall. What I like about the Bill is that it builds on earlier legislation to ensure that apprenticeships are real jobs with substantial and sustained training. The reforms are making apprenticeships more rigorous already and will ultimately help people to realise their potential. It will allow them to have a portfolio, so that they can move jobs if that is what they want to do. We are committed to ensuring that all apprenticeships are of high quality and this has been central to our reforms, as the House knows. High-quality apprenticeships are essential to support our employers and to help our economy prosper in the years to come. I believe that these additions to the Bill improve it and I trust that the House is happy to welcome these amendments.
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- Baroness Neville-RolfeConservative
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- That this House do agree with the Commons in their Amendments 18 to 26.
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- Baroness Neville-RolfeConservative
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- That this House do agree with the Commons in their Amendment 27.
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- Baroness Neville-RolfeConservative
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- My Lords, this group of amendments introduces measures to strengthen rights for shop workers in England and Wales and in Scotland by amending the Employment Rights Act 1996 and the Employment Act 2002. We are no longer pursuing the devolution of powers to extend Sunday trading hours, which these measures were designed to complement.
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- Lord Stevenson of BalmacaraLabour
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- My Lords, when it was first introduced, this Bill was described as a Christmas tree Bill, as have a number of Bills from the Minister’s department. Therefore, it is a particular pleasure to receive a Christmas present at the end of the process in the form of a wholly unlooked for, but none the less very welcome, strengthening of the powers that now apply to people who have to work within the existing legislation on Sundays. I am not sufficiently expert in Whitehall matters to know how long it would have been until an appropriate Bill came round and these very important issues would have been taken on their merits. Of course, as the noble Baroness said—she did not give us the gory detail—there was a bit of a circuit round Whitehall to find, first, a Bill that would take the devolution proposals and then a Minister willing to put the proposals into a Bill. Indeed, I seem to remember the noble Baroness saying at a meeting, perhaps informally, that the last thing she wanted to see in her Bill was a measure involving Sunday trading. She has had to concede a very important set of small paragraphs which will help people who currently work on Sunday, and we are delighted to have them. This should go down as one of those case studies that appear in books describing how awful Whitehall can be sometimes, because at the meetings I went to we could never work out what the Government were trying to do. Was this about tourism or an attempt to defeat the incursion of internet shopping into our high streets? Was it to promote high streets? Was it to make sure that smaller shops in smaller towns were supported? It never really got sorted out. As one of the participants at the meetings, the right reverend Prelate pointed out that at the end of the day, unless you sorted this out in a holistic way, involving the staff from the beginning, it simply would not happen —and it did not. With that ringing in our ears, we welcome this proposal and look forward to its early implementation.
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Lord Alton of Liverpool (CB)Crossbench- Quote
- My Lords, before we leave this group of amendments, I echo something that the noble Lord, Lord Stevenson, said a moment or two ago about the importance of protecting workers’ rights. I was involved in the original legislation when it was enacted and spoke in another place about protecting workers who wanted to opt out of having to work on Sundays, and I moved amendments that excluded Christmas Day and Easter Day—two of the very few amendments that were successful at that time. To some extent, these amendments merely tinker with the protections provided previously. A lot of evidence has been gathered in the years since the enactment of the original legislation which indicates that those protections need strengthening further. I simply refer the Minister to what one of her predecessors —the noble Lord, Lord Sassoon—promised Parliament back in 2012, on 24 April, when he spoke at the Second Reading of the Sunday Trading (London Olympic and Paralympic Games) Bill. He said that Parliament would have the opportunity fully to debate the issue of Sunday trading restrictions if the issue were revisited. I simply ask the Minister why it therefore required the intervention of notable Members of Parliament such as Mr David Burrowes and the redoubtable Fiona Bruce, who worked across the divide to defeat the Government’s proposals, to prevent something being stampeded through without proper parliamentary scrutiny. Why was the promise given to the House in 2012 not honoured? Why did we not have a debate about this when it was in your Lordships’ House in the first instance, before it went to another place? Perhaps the Minister will shed light on that. The Minister will know that there were some 7,000 responses to the consultation process the Government initiated. It would be a great breach of trust in the future—at a time when trust is not held in very high esteem by many people when looking at Parliament and politics—if we were both to ignore the responses to the consultation process and circumvent the promises Ministers have previously given. If any further changes are intended, will there be the opportunity for full parliamentary scrutiny? Can we please not use such methods, which, in the end, it took members of the Minister’s own party in the House of Commons to prevent the Government from proceeding with in a very high-handed way?
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Lord Mackay of Clashfern (Con)Conservative- Quote
- I associate myself with a good deal of what the noble Lord, Lord Alton of Liverpool, has said. In particular, strengthening the rights of those in the retail trade in relation to Sunday trading is very important. I am glad that, however it has come about, it has ultimately been a government proposal which I hope noble Lords will agree to very quickly.
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- Baroness Neville-RolfeConservative
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- I thank the noble Lord, Lord Stevenson, for his comments. I am also grateful for the welcome for these changes from the noble Lord, Lord Alton, and my noble and learned friend Lord Mackay of Clashfern. The provisions on Sunday trading were still being developed when the Bill was in the House. This is one of the reasons why I did not expect to be leading a discussion on Sunday trading. As noble Lords have said, the measures were originally intended as part of a much wider package, including measures on Sunday trading hours. The House of Commons spoke clearly; it had a debate; it has left the enhancement of shop workers’ rights in the Bill and this has been welcomed. We have not, therefore, had the chance for a full debate but it is good that we have had today’s debate. In conclusion, some shop workers can still face pressure to work on Sundays, despite existing measures to protect them. This strengthening of shop workers’ rights makes it clear that this should not be the case. I beg to move.
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- Baroness Neville-RolfeConservative
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- Moved by That this House do agree with the Commons in their Amendments 28 and 29.
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- Baroness Neville-RolfeConservative
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- That this House do agree with the Commons in their Amendment 30.
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- Baroness Neville-RolfeConservative
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- My Lords, Amendment 30 removes the provision, introduced on Report by the noble Lord, Lord Teverson, regarding the Green Investment Bank. I pause to pay tribute to the noble Lord. I am very grateful for his thoughtful and well-reasoned proposal, which requires a special share to be created to protect the green purpose of the bank when it leaves public ownership. We were all in the same place on this objective and he helped the Government find a way through. As the noble Lord and I have discussed, there is a significant risk that mandating this structure in the legislation itself would prevent the bank moving to the private sector, so the Government needed to remove the provision from the Bill. However, there will instead be a special share held by a separate company, independent from Government, which will have the right to approve—or, equally importantly, reject—any proposed change to the bank’s green purpose as set out in its articles of association. I can confirm that the Government have consulted with the Office for National Statistics, the body which determines whether an organisation is classified to the public or private sector, on the basis of internationally agreed rules. The ONS Economic Statistics Classifications Committee has formally opined that this special share should not prevent the bank moving to the private sector once it is sold. The noble Lord, Lord Mendelsohn, has suggested an amendment to bring out the ONS decision more clearly and I look forward to hearing his views on this. I am grateful to the noble Lord, Lord Smith of Kelvin, for his leadership of the bank and, as chairman of the bank, for updating noble Lords on progress in putting this special share in place. Those letters are in the House Libraries. Noble Lords will be aware that the Government launched their sale of the Green Investment Bank last month. In launching the sale, we made very clear to the market and potential bidders that this special share model will be in place. We laid a report before Parliament on 3 March, which included details of our plans to create a special share as part of the sale process. I therefore commend Amendment 30 to the House, and I beg to move. Amendment to the Motion on Amendment 30
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- Lord MendelsohnLabour
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- At end insert “, and do propose Amendment 30B in lieu of the words so left out of the Bill”.
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- Lord MendelsohnLabour
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- My Lords, before I speak to the amendment, I would like to congratulate noble Lords on the Liberal Democrat Benches for their work on this. The noble Lord, Lord Stoneham, made a very powerful speech in Committee. I pay extraordinary and particular tribute to the noble Lord, Lord Teverson, who has done a simply outstanding job in all the spadework that was done, and in speaking to a range of people; he has come up with a very elegant formula. I also congratulate the noble Lord, Lord Smith of Kelvin, and his colleagues at the Green Investment Bank, in moving to embrace this model. In fact, the special share provides for a much better Green Investment Bank and for the green purposes to be more extensive than they would have been with any form of government participation because of the state aid rules, so I think we are in a much better position. The rationale behind this amendment relates, of course, to the problem we had in determining the structural issues. In June 2015, the Business Secretary announced the Government’s intention to privatise the bank to allow it to borrow more capital without adding to government debt, as reported in Business Green. However, the ONS ruled that, in order for the bank to obtain status as a private body, the Government must repeal any of their involvement in or control over the Green Investment Bank’s operation. As part of the privatisation process, the legislation in the Enterprise Bill, enshrining the Green Investment Bank’s green ethos, must be removed from the statute. This requirement has prompted fears that the bank could be hijacked by a private investor seeking to make investments not aligned to its core values. The department’s November policy statement described the situation as follows: “The decision on whether an organisation is classified to the public or private sector is made by the Office for National Statistics (ONS) and is considered in accordance with the EU-wide regulations, set out principally in the European System of Accounts 2010, (ESA 2010) and supplemented by guidance in the accompanying ‘Manual on government deficit and debt’”. In the light of the Government’s discussions with the ONS and HM Treasury, and the department’s assessment of the regulations, it was clear that even if the Green Investment Bank was no longer owned by the Government, current legislation on the bank was highly likely to be assessed by the owners as constituting government control over it, preventing it being reclassified to the private sector. It also said that the ONS would be in a position to take a substantive decision on the bank’s classification only once a transaction had actually taken place. Of course, that involves in part the question of contractual arrangements, but it is also about procedure. This leads to a highly unsatisfactory process, which we faced when the Green Investment Bank provisions were first introduced into this Bill, which was something of a rush. It involved a lot of panicked conversations and an extensive repeal of existing legislation, without particular rhyme or reason being properly articulated. We have had an unseemly mess, which has only been adequately resolved by the efforts of the noble Lord, Lord Teverson. That could all have been avoided if there had been a reasonable discussion and a proper statement of reasons by the Office for National Statistics. We have to consider that there are other opinions about whether this provision would breach those rules, and whether what was being said was likely to be actually true. Many experts in this field, given the opportunity, would have liked to make the case that classification was not necessary and the ONS was not just being overly cautious, but went way beyond the mark in making such an assessment. Indeed, there are examples in other countries of similar models which statistical bodies have applied without any real difficulty. Finally, from the discussions that have taken place I am led to believe that the provision of a special share and the new structure of the Green Investment Bank enhance its value and the possibility of the overall sale of the bank. It is sensible for us to put in not some form of government or parliamentary oversight but a broader ability for ONS decisions to be made public earlier, for experts and practitioners in this field to have the chance to review them, and for the ONS to make a much more timely assessment and make those reasons well known. This is a simple amendment, which we hope the Government will look at carefully and consider a probable enhancement to the process as we look to change the status of certain assets in the Government’s control and move them towards the private sector. This would be a helpful addition, and I beg to move.
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Lord Teverson (LD)Liberal Democrat- Quote
- My Lords, I thank the Minister very much for her kind words and the noble Lord, Lord Mendelsohn, for his great support and that of his colleagues all the way through this process. I also very much welcome the work and effort that the Minister put into persuading her ministerial colleagues to go down this route. I am sure that she was vital in that process. I hope that, because of this, as she said, all parts of the House are happy with the position we have reached and that the conditions which were put in the Bill will now be delivered in practice. As we have always said from these Benches, we were not really concerned with how it happened as long as it did happen. I am sure that we will have an institution which we in the United Kingdom, including the environmental movement and the financial community, can be proud of for many years to come, and that we will not face yet another generic financial institution with no real focus in the environmental area or anywhere else. We have avoided that happening in the longer term. I want to speak briefly to Amendment 30B, in the name of the noble Lord, Lord Mendelsohn. We have had a number of discussions about the privatisation of the Green Investment Bank. One area of discussion was the frustration—I came to be very sympathetic to the Government over this—in trying to determine whether amending legislation would mean that an institution on which we were legislating ended up in the public or private sector. I read through all the guidelines published by Europe and the ONS on classification but it seems that, despite them, a lot of these issues are not straightforward. They are quite subjective in many ways. The nub of this—the noble Lord, Lord Mendelsohn, put this over very well—is that it gets in the way of the parliamentary process. If, because of a particular amendment or the way in which legislation is written, the Government cannot be certain at the end of that process whether a body is in the public or private sector, it means that they are forced to be conservative with a small “c” in estimating how an amendment should be phrased. That is not healthy for parliamentary debate or the way in which legislation is formed. Although this is a limited amendment, I very much agree with its spirit. But I say to the House that this area needs to be investigated further. The amendment would not challenge in any way the independence of the ONS, which is clearly sacred; but its transparency and the way its decisions are made, pre-event as well as ex post, are extremely important. I wish the Green Investment Bank every continued success in its mission to stimulate the green economy. It has been successful in the past and I hope that, through its privatisation, it will be even more successful in the future.
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Lord Hope of Craighead (CB)Crossbench- Quote
- My Lords, the chairman of the Green Investment Bank, the noble Lord, Lord Smith of Kelvin, is not in his place this afternoon, but I am sure he would like it to be said on his behalf that he is grateful to the Government for agreeing to remove these three clauses from the Bill and to the noble Lord, Lord Teverson, for all the work that he has done to bring this solution about. I think it is right to say that as far as the chairman is concerned, his main aim in detaching the bank from the public sector is to attract investment. From his point of view, investment is vital if the bank is to fulfil its ambitious plans to double the size of its business and to deliver a growing green project—I am quoting from one of the letters which, as the Minister said, have been placed in the Library. So minimising the risk of the bank being classified as part of the public sector is part of the strategy of the noble Lord, Lord Smith, to attract investment, and from his point of view, the result of the amendments the Minister has moved will be to help him to deliver what he is seeking to deliver. I think I should mention also that steps have been taken by the bank to make progress with the overall scheme that has been devised. A new special shareholder company has been incorporated and agreement from three very well-established and reputable institutions has been secured so that they will help the bank to find individuals to serve in a personal capacity as trustees of the special share that has been set up. The structures are now being put in place and the step being taken this afternoon is really the last in the series of steps to bring about the reality that the noble Lord, Lord Smith, has been seeking to achieve for some months. So, on his behalf, I repeat the thanks to various people, including the Minister, for what has been achieved.
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- Baroness Neville-RolfeConservative
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- My Lords, I thank all noble Lords, especially the noble Lord, Lord Teverson, for his gracious comments. This has been a brief but constructive discussion. Let me reiterate that the Government not only support the intention of this provision but are already acting on it. I am also very grateful for the intervention of the noble and learned Lord, Lord Hope, speaking on behalf of the noble Lord, Lord Smith, who could not be here today. He rightly underlined the importance of the external investment that the Green Investment Bank is seeking to raise to realise its exciting green ambitions. Working across this House, we developed a mechanism that meets our purpose. It allows the bank to move to the private sector, meaning that it can grow and increase its green impact, and it ensures that its green mission is protected. With regard to the amendment tabled by the noble Lord, Lord Mendelsohn, the ONS publishes its decisions routinely. Indeed, for some classification decisions, such as that of Royal Mail or Lloyds TSB, the ONS also provides detailed reasoning behind the classification decision. I can reassure the noble Lord that the ONS has confirmed that it will publish a detailed explanatory article on its decision on the classification of the GIB. However, I must emphasise—this is the nub of the problem—that a decision on the GIB will be taken only after the sale has taken place. There is a reason for this. Until the ONS is able to look at the full facts of the matter, such as the legislation which exists at that point in time, the precise nature and number of the shareholders, their rights and so on, it cannot make a formal decision on which party is in control of the body, and hence on its classification. That is why the Government engage with ONS during the development of policy proposals, where ONS will give a formal, but provisional, classification assessment. That is what we did with the special share structure which the GIB is now putting in place. As I mentioned earlier, the ONS has given us a formal opinion that this structure should not prevent the GIB moving to the private sector. The noble Lord, Lord Mendelsohn, rightly asked why the decision could not be published earlier. As I have said, the decision will come after the sale has completed. Until the full details, which would include legislation, ownership and contractual arrangements, are known, any judgment on who controls the body could only ever be provisional—so providing an earlier decision would not enhance certainty. Unfortunately, the nature of these assessments can be complex and cases can be time-consuming, although I am glad to say that the ONS publishes its forward work plan every quarter, which sets out the classification issues that it will be considering. So what is the way forward? I understand noble Lords’ frustration; I have to say that I shared it myself in spades on the question of public sector classification and the ONS’s role. These concerns go wider than just the issue of the Green Investment Bank, and I am happy to undertake to bring them to the attention of my colleagues in the Treasury to see if anything can be done for future cases to help rightly risk-averse government Ministers. I hope that we can all agree that we have reached a good outcome for the Green Investment Bank and wish it well, and I hope that in the circumstances the noble Lord will feel able to withdraw his amendment.
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- Lord MendelsohnLabour
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- My Lords, I thank the noble and learned Lord, Lord Hope of Craighead, and the noble Lord, Lord Teverson, for their comments about the good work of the noble Lord, Lord Smith of Kelvin, and the good wishes that we have for the bank’s successful operation in the future. I thank the Minister for her comments. I would just say that if you go to someone for a provisional view and they give it, you must have given them some assumptions for the basis of which they can take such a view, and you must have given them a potential range of assumptions. It is certainly true that a decision cannot be confirmed until the full facts are there, but some assumptions were given at the first stages in order to take that provisional view. All we are asking is to make sure that that view is made properly available because, as the noble Lord, Lord Teverson, said, so many of the measures are subjective. But I appreciate her comment that she will go back and look at what can be done. In light of that positive response, I beg leave to withdraw the amendment.
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- Baroness Neville-RolfeConservative
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- That this House do agree with the Commons in their Amendments 31 and 32.
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- Baroness Neville-RolfeConservative
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- That this House do agree with the Commons in their Amendments 33 to 39.
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- Baroness Neville-RolfeConservative
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- My Lords, I think that we are now on the homeward path. These amendments relate to public sector exit pay. A number of noble Lords have spoken on this subject. However, the amendments made in the other place that we are discussing today relate only to further regulation-making powers for Welsh Ministers in devolved areas. Specifically, the amendments enable Welsh Ministers to make regulations in respect of exit payments where they have devolved legislative competence for exit payments under the Government of Wales Act 2006. The amendments have been improved by the Welsh Assembly and I hope that noble Lords will also approve them. I beg to move.
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Lord Hain (Lab)Labour- Quote
- My Lords, I welcome what the Minister has just said in respect of Wales. I point out to her that that is exactly the argument that I and my noble friend Lady Morgan put forward on the Trade Union Bill when we said that these were devolved matters covering devolved public services and that it was a breach of the devolution settlement that the Trade Union Bill transgressed that. So I am very glad that she has conceded that principle in this Bill.
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- Lord MendelsohnLabour
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- My Lords, the Conservative manifesto introduced this issue, saying that a Conservative Government would legislate to cap redundancy compensation for public sector workers with a particular focus on larger amounts. I will make just a few comments about something that has received some consideration but falls slightly outside that, and it would be useful if the Minister could give some indication of whether the Government were thinking in some way about how to accommodate this. It relates to the nuclear decommissioning workers who entered into an agreement with their employer. To seek to undo that agreement through legislation is slightly unjust, and this is worth looking at. The new legislation supersedes protections under previous legislation, including the statutory protections introduced under Schedule 8 to the Energy Act 2004, which currently safeguards workers’ pensions, such as those of the Magnox workers. It has been estimated that about 1,200 Magnox workers who are decommissioning the UK’s nuclear plants will be caught out by the proposed measures in the Bill, which could see them losing thousands of pounds in retirement income. The particular reason why these cases are worthy of note is of course that people took on those jobs knowing that it would change their retirement years because they were involved in a job which had an end date which was not the same as their full working life—these were expert workers who made the decision to do it because in compensation the balance of pension payments would in some way adequately reward their commitment to that work. The impact of the Bill could also be felt by many other workers, including the entire 30,000 who are working across the Nuclear Decommissioning Authority’s estate, who will also be affected by a cap of £95,000. As I understand from the presentation in the manifesto and at other times, the exit cap was to be seen as putting a stop to the so-called golden handshakes or fat-cat pension payouts in the public sector. But it will impact on many long-serving low-paid workers within the nuclear industry. That is why we hope that there will be some opportunity outside the Bill for the Government to look very carefully at the arrangements they have for those who do this difficult, dangerous and very important work and to give some due consideration to that, particularly because their provisions also relate to an agreement that was present in the Energy Act 2004.
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- Baroness Neville-RolfeConservative
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- My Lords, I am grateful for the response and for the support for these amendments. Similar to the Scottish Government, the Welsh Government can now determine how they want to take forward arrangements in relation to devolved bodies and workforces. The devolved Administrations will be responsible for putting forward their own regulations and listing relevant bodies in scope. As I made clear in introducing the amendments, they will enable Welsh Ministers to make regulations in respect of exit payments where they have devolved legislative competence for exit payments under the Government of Wales Act 2006. Therefore, the situation is different from those issues, which we will no doubt come on to debate later this afternoon. The noble Lord, Lord Mendelsohn, asked about the Nuclear Decommissioning Authority—a point that we have touched on before. Interestingly, as we discussed in relation to the previous amendment, the ONS is involved. It determines whether a body falls within the public sector by reference to objective criteria, based on whether the governance, funding, ownership and function of these bodies demonstrate that they are controlled by government. Organisations within the Nuclear Decommissioning Authority carry out important public work, acting as agents of and under the direction of the NDA and operating only through a licence issued by the Office for Nuclear Regulation. The majority of funding provided to the NDA comes from the Exchequer and amounts to about £2 billion a year. Regulations, not the Bill itself, will set out who is within the scope of the cap, and I can reassure the noble Lord that the Treasury will release both the guidance and regulations in the summer in order to consult with stakeholders. We expect the regulations to come before this House later this year and to be in force from October 2016 at the earliest. NDA employees due to exit before this date will not be affected. From the point when the regulations have been made, Ministers will be able to relax the cap and may wish to consider whether exceptionally it should be relaxed for certain individuals or even organisations. To conclude, as I said earlier, the Bill supports the UK’s position as the best place in Europe to start and grow a business. The amendments made in the other place make a series of changes to further support our aim, adding measures on apprenticeships, Sunday working, Wales, tidying up the pubs and on the Green Investment Bank, and making a number of technical changes. I thank all noble Lords who have spoken in the debates in this House and of course in the other place.
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- Lord HainLabour
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- I apologise to the Minister and my own Front Bench, but I cannot accept the distinction she is making between Bills here. The Minister is saying that the principle that devolved public services should be run by the Welsh Government is accepted by Her Majesty’s Government in this House in respect of this Bill but not in respect of the Trade Union Bill. That gives rise to a major question which the Welsh Government will want to revisit.
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- Baroness Neville-RolfeConservative
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- I thank the noble Lord. My understanding is that the situation is different but we will no doubt have a debate later today—as I have already indicated. I do not think that we can spend further time in relation to this provision, which is clear cut and fully supported. I finish by thanking all those who worked tirelessly behind the scenes to facilitate the Bill’s passage through this House, including the House’s authorities, the Lord Speaker and the Bill team, who have worked so hard to get us to this place.
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- Baroness Neville-RolfeConservative
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- That this House do agree with the Commons in their Amendments 40 to 54.
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