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Richard Fuller (Bedford) (Con) rose—
James Berry (Kingston and Surbiton) (Con) rose—
Mary Creagh: May I develop my arguments? I shall be happy to take further questions a little later.
Following a discussion with my colleagues in the Environmental Audit Committee last week, I wrote to Lord Smith of Kelvin, the chair of the Green Investment Bank, asking for clarification of the proposed remuneration for the bank’s senior executives. Our shareholders—taxpayers—could potentially remain as minority shareholders in the enterprise. I think that as long as the UK taxpayer has even a 1% shareholding in the bank, that should be carried forward. Taxpayers have committed £3.8 billion to the bank, and rather than talking about what a future owner will put into it, let us wait until we see the colour of that future owner’s money.
In that letter, I made it clear that the Environmental Audit Committee could see no reason for increasing remuneration as a result of a change in the bank’s status. We were particularly interested to know the proposed structure both of the management fee that the privatised bank would charge investors, and of any form of profit share or participation rights for management proposed in the offering to new shareholders. We wanted to know the board’s view regarding the quantum and structure of executive profit share incentives. We also sought an assurance from the board and management of their commitment to maintaining the staffing levels that the public purse has funded, to ensure that the bank continues fully and effectively to serve the UK’s needs for investment in green infrastructure.
Lord Smith’s reply to me reassured the Committee that the proposed business plan
“will require the current staff complement with possibly a small number of additions.”
That was reassuring, but less welcome was his response that the information memorandum for investors, which includes projected revenues and costs, including staff costs—this therefore has already been decided and written at board level, and had probably been decided and written when the Minister was in Committee with us—is commercially confidential and cannot be shared.
Richard Fuller: The hon. Lady has special knowledge in this regard, so may I tease out some information from her? She mentioned the £3.8 billion of public money that had been invested at a time of public expenditure reductions in certain areas. What consideration did her Committee give to what valuation would be appropriate when the Government sold the bank? She rightly said that it had constituted an inspiring start by the coalition Government, and that she wanted it to be an exemplar. Do the Government not have a special responsibility to ensure that they let it go into the private sector at the right time?
Mary Creagh: The Committee’s remit was not to second-guess what the Government could or could not get for the bank. I am sure that there are people in the City who are much better able to do that than I am, and I am sure that some Members, certainly Conservative Members, could make a good stab at it.
When I worked with small businesses, it was possible to get multiples of income, but that depends on what is being bought. In this case, what is being bought is an
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asset book with, it is to be hoped, future revenues from the investments that have been made—as well as what might be described as senior bank management intellectual capital—but what is also being bought is £3.8 billion of Government investment in green projects from which the purchaser will hope to gain revenue and capital streams as, at some point, they are sold off. The situation will also depend on what the purchaser will put into capital projects.
Richard Fuller: The hon. Lady rightly says that there has been a series of investments in the bank, but it would be possible to calculate the net present value of those assets, given certain assumptions. Has her Committee attempted to do that? Such a calculation could provide an evidential base that would enable us to understand whether, if the bank is sold in future, it has been sold on a fair basis.
Mary Creagh: We have not calculated the net present value, but I am sure that it would be quite a simple process and that there will be a number of attempts to calculate it as the sale proceeds. No doubt the Government will wish to let us know whether they think that that has been achieved.
James Berry: May I make a point about the issue of longevity? There is plainly a public interest in the bank’s remaining a green investment bank because of the amount of public money that has already been invested, and because of public interest in the development of green fuels and energy. That, together with the work that the Committee will do in scrutinising the bank’s future, surely provides enough protection to ensure that it will indeed remain a green investment bank.
Mary Creagh: Once the bank is sold, my Committee will have no locus in scrutinising what it does. We could look into it only as a matter of interest. This is the final legislative opportunity that we have collectively as parliamentarians to say what we want to happen to the bank. We might have a chance to discuss it further if the matter is debated upstairs in Committee, but the process is now at its penultimate stage. The starting gun has been fired; the first round of the bidding process has already started. If the Government decide that they want to sell 100% of the bank by, say, September or Christmas, the Environmental Audit Committee could look into whether best value had been achieved, but only as a matter of interest. However, we want to test the proposals on the special share today to ensure that the public interest is protected, as the hon. Gentleman says, and that the green vehicle can continue to move forward. The Green Investment Bank is a really important financial institution for enabling us to meet our climate change targets.
The Chancellor said in January that the sale of shares in Lloyds would be postponed because of market turbulence. The sell-off was scheduled for the spring, but he has now said that it will come after Easter. We shall wait and see when that happens. Since the start of the year, we have seen a bear market, great turbulence in the financial markets, panic selling of crude oil, and oil prices at a 13-year low. These are worrying times for the global economy and the market is hugely volatile. All bank shares are currently falling in price, whether they are UK bank shares, European bank shares or US bank
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shares. Just this morning, we have heard that the Bank of England has announced it will give commercial banks three exceptional opportunities just before and after the EU referendum to borrow as much as they like to offset any threat of a run on banks and to prevent a repeat of the chaos of the financial crisis in 2007 and 2008. In the light of that bleak, turbulent and choppy financial picture, we have to ask whether the Government’s decision to launch the sale of the bank last Thursday was the right one. Whatever one’s views on privatisation, this hardly seems to be the most auspicious time to sell off a state asset, let alone a state-owned bank.
Barry Gardiner: I congratulate my hon. Friend the Member for Wakefield (Mary Creagh), who chairs the Environmental Audit Committee, on her speech. I wholly agree with what she has said. I also congratulate her and her Committee on all the work that they have done to tease out the details of this sale.
In 2012, the Green Investment Bank was set up for a purpose. It was stated quite clearly that its purpose was to address specific market failures and investment barriers in a way that would achieve emission reductions at the lowest cost to taxpayers and consumers. It was going to achieve that by working within the framework of the Climate Change Act 2008 and by risk-sharing between the public and private sectors, identifying and addressing market failures and limiting private investment in low carbon infrastructure, thereby accelerating and delivering green investment on a large scale and with significantly lower capital costs. That was the whole point. The bank was set up precisely because there was a market failure. The private sector was not able to achieve this. It is not just me, an Opposition Member of Parliament, who is saying that. Labour supported the bank. Indeed, it was our idea in the first place when we were in government, and we were delighted when the coalition put it into place.
The coalition Government also set up the Green Investment Bank commission. It was an independent, non-partisan advisory group brought together by the Chancellor himself. It took three years and two official rounds of rigorous market testing and evidence gathering to establish that a green investment bank was needed. The commission collected evidence to inform the bank’s aims, its design and the operating model under which it would function. Let us compare the three years and two official rounds of market testing it took to set the bank up with the sudden shock decision to sell it off, which was taken with a complete lack of consultation.
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What did the commission find? It found that without a way of directly addressing market failure and risk-sharing between the public and private sectors through a green investment bank, higher levels of direct subsidy would be required to facilitate low carbon investment. That would mean higher costs to the consumer and the taxpayer. That is what the Chancellor’s own commission, with the hand-picked people he put on it, agreed. That rationale is now being undermined by this sale. Let us be absolutely clear that, according to the Government’s own commission, this sale will result in an increased cost to the consumer and the taxpayer.
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The Chancellor has given himself something of a problem. By committing to achieve a public finance surplus every year in normal economic times, the Government have ruled out borrowing to fund public infrastructure. The exception is investments through the private finance initiative, which do not affect the headline public finance numbers. Since the financial crisis, there has been less private finance available to invest in either public-private or private infrastructure projects. At the same time, direct public investment has also decreased.
One of the concerns expressed by investors relates to the political risks that have manifested themselves as a result of potential changes in Government policies. Those changes have already been criticised and I will not go into them again today. However, the way in which the Government have chopped and changed the regulatory framework for low carbon investment has resulted in a decline in the UK’s attractiveness for investment, as the hon. Member for Brighton, Pavilion (Caroline Lucas) has commented from the Green Benches. According to the Ernst and Young rubric, we fell out of the top 10 best places for investment for the first time last year.
The way in which this issue has been tackled by the Chancellor has been twofold. The Pensions Infrastructure Platform has sourced less than £1 billion in total over its first four years of operation, despite its aim being £20 billion. Furthermore, instead of the projected £40 billion from the UK guarantees scheme, only £1.7 billion in guarantees was actually issued in the first two years. Let us contrast that dire financial performance with the performance of the Green Investment Bank. Having been set up with just £2.3 billion of public money, it has mobilised more than £10 billion of investment in British infrastructure in the past three years.
Actually, I wish the bank had had a few more failures. It adopted a very specific policy at the beginning, which was to go for safe projects. It went for those projects because it wanted to build up a track record of successful investment so that, at about this point, it could attract much more private sector capital and take on riskier projects. That is the point of a green investment bank. The point is not to do what the market is going to do anyway by investing in areas that will obviously attract a return on capital. The whole point of the Green Investment Bank was to take on those much more difficult technical projects that the market would not finance.
Three years in, we have reached precisely the point at which we should be thinking, “Great! The bank has a successful track record behind it. Now it needs to move into slightly riskier projects.” Some of those projects might have failed—that is the nature of banking and investment—but the overall balance of investment flowing into UK infrastructure would have been hugely enhanced. So what do the Government decide to do just at the point of lift-off of the Chancellor’s only successful lever to get money into infrastructure projects in this country, the performance of the other two having been quite dismal? They pull the plug. They throw it away—send it off into the private sector, the very place that could not manage this market failure in the first place.
The hon. Member for Beckenham (Bob Stewart) said earlier that the bank is a success so why can it not go on being a success in the private sector? That was the question that had to be posed by the Green Investment
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Bank commission in the first place and the question that the bank was set up to answer. The former chair of the bank, Bob Wigley, pithily provided the best response to the hon. Gentleman’s question when he said that there was an “inherent tension” between the GIB’s continuing to invest in novel, more complex projects that are profitable over the long term and shareholder pressure to maximise short-term returns on high-value investments, given the focus on quarterly performance.
There you have it. There is a tension in the private sector. It is one that we all recognise. It is well-known. It is one that the Governor of the Bank of England has spoken about at great length over the past year. He called it the “tragedy of the horizon.” The investment horizon is so short that investors cannot see the payback in these sorts of projects. It is tragic that Government are privatising—neutering—one of the best things that they have established.
Caroline Flint (Don Valley) (Lab): My hon. Friend is making a persuasive argument. Does he agree that if we are to be a country represented by, as the Chancellor said, a “march of the makers”, part of that is being at the front of the queue when it comes to leadership and supporting innovation in the green energy and green environmental products marketplace? Does my hon. Friend feel that privatising the Green Investment Bank will just create yet another bank—one that will not do the job for which it was intended?
Barry Gardiner: My right hon. Friend has enormous knowledge in this area and I absolutely agree with her. The most successful instrument that the Government have created for energising and putting investment into infrastructure projects in this country is now being neutered. That is a tragedy, which these amendments seek to address.
The Minister for Small Business, Industry and Enterprise (Anna Soubry): It has been an interesting debate, but I must confess that I do not agree with many of the arguments advanced by the Opposition, so I hope that hon. Members will not support any of the new clauses.
If I may deal with things in reverse order, I will first address new clause 8, tabled by the hon. Member for Brighton, Pavilion (Caroline Lucas), which seeks to ensure that the Green Investment Bank continues its green investments plans post-privatisation. We agree on what we want the bank to continue to do. We are seeking bidders who can fund the GIB’s legally binding commitments and who have the deep pockets to fund its ambitious green business plan. The bank’s management is clear that it needs access to private capital to fund its green business plan. That could be equity capital raised as part of the sale process, debt capital, which the GIB can raise when it is in the private sector, or private capital raised as part of a fund structure.
Business plans change and evolve as new opportunities arise, and we will not bind new owners into the current plan, so I cannot accept the hon. Lady’s new clause. The new owners of the GIB will have views on the future strategy and business plan. They will assess it as part of their due diligence and make it a part of their offers. Whoever the new owner or owners are, the special share ensures that the business plan, like the GIB, will continue to be green.
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It must be said in response to many of the points and arguments that it is almost impossible to understand why anybody would want to buy the Green Investment Bank—the clue is in the name—unless they wanted to ensure that it continued to invest in green projects.
Callum McCaig (Aberdeen South) (SNP): We welcome the general direction of travel, given the special share. The Government will have a clear say during the privatisation process in the selection of the new owners, so will the Minister expand on how they will ensure that appropriate owners, who will respect not only the special share but the green agenda, are put in place?
Anna Soubry: Everyone will, of course, have to comply with the due diligence. I welcome the hon. Gentleman’s comments and will dwell on that topic in a moment. I want to make it absolutely clear that it is difficult to believe that anybody would buy the Green Investment Bank unless they absolutely wanted to continue its great work, for which I pay tribute to the bank.
Anna Soubry: I will give way, but I want to move on to specifically why Opposition new clause 4, relating to the special share, is wrong and why the Government’s proposals are absolutely right.
Caroline Lucas: I have two points. First, this is not just about green purposes. We should remember that the Green Investment Bank has particularly focused on complex and novel innovations, which take longer. It is not such a quick win, which is precisely why a private investor might not want to do the same and why public money is needed. Secondly, the special share is not legally underpinned, which gives us no long-term reassurance.
Anna Soubry: I disagree with the hon. Lady, because the privatisation and sale of the Green Investment Bank is about ensuring that more money is available from the private sector to carry out that particular sort of investment. Forgive me, but it really is not the role of Government to gamble and make investments with taxpayers’ money. That was right in 2012 when, as mentioned by the hon. Member for Brent North (Barry Gardiner), the Green Investment Bank was set up because of an accepted market failure. However, the idea that the Government are throwing it away, as he put it, could not be further from the truth. The Green Investment Bank is a real success story. No one is seeking to pretend that it is anything else. We want its success to continue, but in the private sector.
Barry Gardiner: Does the Minister actually believe that there is no longer any market failure that needs to be addressed? The figures on infrastructure suggest quite the opposite. The point made by the hon. Member for Brighton, Pavilion about the innovative and novel projects that the Green Investment Bank was set up to support is that they pay much less return into the private sector, which is precisely why risk-sharing between the Government and the private sector was necessary to launch the bank in the first place.
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Anna Soubry: The fact that the Green Investment Bank has been so successful absolutely proves that such investments can be profitable and worth while. In other words, the bank has shown through its success that there is market failure no longer.
David Mowat (Warrington South) (Con): Members on the Opposition Benches seem to be saying two things. The first is that the private sector does not do long-term projects. Well, Shell, BP and others do many projects over decades. They also say that the private sector does not do innovative projects well. Those suggestions are just nonsense.
Anna Soubry: I thank my hon. Friend for his excellent intervention, which I wholeheartedly endorse. We have always said the Green Investment Bank would stay green after privatisation. Green investment is what it does, as its management have made clear. We have explained that the only reason we are repealing the green protections from legislation is to allow the GIB to move to the private sector, by removing state control over the bank. However, we understand the concerns raised by hon Members and noble Lords, and we have found a device to protect the GIB’s green purposes without legislation.
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I am very grateful to Lord Smith of Kelvin, who, as has been mentioned, has written to Opposition Members in the other place explaining the view of those currently in charge—I shall put it in that way—of the GIB about this special measure and why they absolutely have all confidence in it actually achieving what we all want to achieve. This is the device that cures the mischief.
Anna Soubry: I am not going to give way because I just want to put on the record my thanks to Lord Smith for his letter, which was sent out by my excellent Parliamentary Private Secretary, my hon. Friend the Member for Rugby (Mark Pawsey), to all Members of this House. I hope all hon. Members, on both sides, have had the opportunity to read it, because it could not be clearer about why what the Government have proposed will ensure and protect those green purposes, and why legislation in this area is absolutely not necessary. One reason why we do not want the Opposition’s new clause 4 to be successful and to put this provision into legislation is that we feel the Office for National Statistics will take the view that what we seek to do will not be achieved in this way—the bank will not be off the books—and that is why it is so important that this is done in the way we propose.
Bob Stewart: In support of what my right hon. Friend says, let me read from Lord Smith’s letter. He says:
“We are 100% committed to delivering the full intent of the amendment passed in the Lords. I hope that by committing to implement this plan, and doing so transparently, we can secure the necessary confidence of shareholders, and members of Parliament that a special share solution can be delivered without the need for it to be mandated in legislation.”
Anna Soubry:
I am very grateful to my hon. Friend for reading from the letter. Obviously, I am not going to read it out. You will be pleased to hear that,
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Madam Deputy Speaker, as we would be here for half the afternoon if I did so. I have, however, placed a copy of it in the Library, as it best explains why this new clause is no longer required and why it is so incredibly important that we get the right device to ensure we keep the green principles of the bank.
Mary Creagh: Lord Smith of Kelvin may or may not be the chairman of the bank when this sale proceeds, so I therefore ask the Minister to answer the question I asked in the debate: will this special share apply if the bank is sold by any future owner, yes or no?
Anna Soubry: This is a short answer—yes. The hon. Lady will have seen this letter and I hope she will have read it—upside down, inside out, backwards and everything else. It is well over two pages long and it could not be clearer as to the way the special share is going to be set up. I shall rely on the fact that it talks about the special shareholder and how difficult it would be to undo this device. That could be done only with the permission, in effect, of the special shareholder. This House can therefore be sure that this is the right way to achieve what we all want to achieve.
That is why it is important to pay tribute—some may say that this is a first, and indeed it may not be the last—to the Scottish Government and to the Scottish National party. I have seen the letter John Swinney has written on behalf of the Scottish Government, quite properly as he is the Deputy First Minister and has responsibility in Scotland for finance, the constitution and the economy. He, too, rightly and understandably, has raised his concerns about how we best protect the green credentials of the GIB. As a result, he, too, has contacted Lord Smith, and letters have been sent back and forth. In short, to the credit of the SNP, it takes the view—I will be corrected if I am wrong—that this device, which is up and running, with the work already having been started by the GIB to secure this special shareholding, means that everybody can be confident that this is the way to secure what we all want, but without the need for legislation, which could completely scupper this privatisation and selling off of the GIB.
Kevin Brennan: The Minister has said on many occasions that she is confident that introducing the special share in this way will work. Our case all along has been that we would like to hear her say to the House that she can guarantee, rather than just be “confident”, that the ONS will approve this approach. Can she now say, in terms, on the Floor of the House and on the record, that she can guarantee that?
Anna Soubry:
I hope I am being parliamentary when I say that the hon. Gentleman is being a bit of a minx—I mean that in the nicest way. [Interruption.] He quite likes that, which is good, although I do not think he will like the next bit. I have already explained in Committee that we cannot give that guarantee, and he was a bit naughty, calling the ONS a bunch of boffins. I think he rather regretted it because the people in the ONS are not that; they are absolutely independent of government and will rightly come to their own conclusions. We are confident that if the measure goes into legislation, the ONS will not take this bank off the books, because it will not be properly in the private sector. If, however, we do it in the way that we are all suggesting—I include
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the chairman of the GIB in that—there is every chance in the world that this will then become a successful privatisation. It is confusing to work out what people’s real views are; the hon. Member for Wakefield (Mary Creagh) says that she does not object to the GIB being sold off, although she has raised her concerns. She is in favour of it in principle, but it is not certain whether others are.
Let me now deal with amendment 17, which was tabled by the hon. Member for Wakefield and the right hon. Member for Don Valley (Caroline Flint). Again, we firmly believe it is not required. The GIB is currently required to report to higher standards—the standards for quoted companies—which include the level of detail required by this amendment. That is appropriate because it is currently entirely publicly owned. Post-privatisation, there is no reason why the GIB should be singled out to report on its remuneration to Parliament, especially if it is not spending any public money. It is a matter for the board of a company and its shareholders to agree remuneration policy. I note that there was an exchange of letters between the hon. Lady and the GIB’s chair, Lord Smith, where she asked about future remuneration policy, and I am sure her Committee will publish the letter in full. If the Government retain a minority stake in the GIB—we have made it clear that our intention is to sell a majority of it—we could express views on this and other aspects of corporate policy. We could agree with other shareholders what level of reporting might be appropriate on this and other matters, but we do not consider that this matter should reside within legislation.
As I said, the GIB has been a terrifically successful venture. It is important to understand that it was set up in 2012 because of a market failure. Opposition Members certainly do not like to reminded of the perilous financial situation our country faced in 2010, and it certainly was not all the fault of the banks—it was also a pitiful failing of Government policy at the time. What the GIB has done is help investors in the market to better understand the risks of green investment, and this comes back to the point being advanced by the hon. Member for Brent North. We know that, since 2012, long-term debt markets have significantly improved, which suggests an improvement in market conditions. Frankly, we would not set up the Green Investment Bank today, because those market failures no longer exist. The Green Investment Bank has proved that an organisation can be green and profitable, and its success demonstrates that the market can deliver green, which must be a good thing.
I have dealt with the point about the Office for National Statistics, so I will not repeat myself. The hon. Members for Cardiff West (Kevin Brennan) and for Wakefield asked whether the Government will retain a minority stake in the Green Investment Bank. I have to say that our position has not changed since the Committee stage. I explained then that we intend to sell a majority of the Green Investment Bank. We may retain a minority, but we cannot commit to that. Our report to Parliament makes it clear that decisions on the size of stake in the Green Investment Bank to be sold will depend on the outcome of confidential commercial discussions with investors.
I pay tribute to the Secretary of State for his announcement last week that the Green Investment Bank is now available to be sold. Unfortunately, I can
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say no more than that, other than that we are confident that this sale will be successful and will be done at the time when the market is in the right place. Having said that, we will not sell the bank unless of course we know that we will get the right price. For some time now, we have had strong market interest in the Green Investment Bank, which has strong underlying assets that are less exposed to market volatility. The large infrastructure sales that have recently been made, such as that of City airport, have also been very successful, and that gives us confidence in this part of the markets.
Nobody—not even Scottish National party Members—has asked this question, but if they were to, it would be a good question, so I will pre-empt it and say that one reason why the Green Investment Bank has been so successful is that it has been primarily based in Edinburgh, which is an excellent place in which to do business, especially as it is still within a United Kingdom. I can see no good reason—again, this is something that we explored in Committee—why the Green Investment Bank would want to move away from Edinburgh. Why on earth would it? [Interruption.] If the hon. Member for Aberdeen South (Callum McCaig) wants to intervene, I am happy to give way. [Interruption.] No, he has changed his mind. That is probably because I reminded him about the price of oil, so we will move swiftly on.
The hon. Member for Cardiff West asked me whether the Government can guarantee that the Green Investment Bank will be off the balance sheet. I think that I have dealt with that. I said that we cannot give a cast iron guarantee about the ONS, but we have confidence, and I hope that that confidence will be shared by the whole House.
We do not need this new clause, because of the assurances that have been given by the noble Lord Smith in his extensive letter to all Members of the House. In that letter, he goes into quite considerable detail about the mechanisms that he is already putting in place to ensure the future green credentials of the Green Investment Bank. That is why we say that this new clause, which will be tested, should be resisted.
The hon. Member for Wakefield and the right hon. Member for Don Valley (Caroline Flint) have quite rightly raised their concerns about the Green Investment Bank and tabled amendment 17. When the bank is sold, it will be a private sector company—this is an important point to put on the record—and, as such, it will be subject to normal company law. For a company the size of the Green Investment Bank, which is unquoted—that means that it is not listed on the stock exchange—the minimum requirement will be to report aggregate information in relation to total remuneration and specific information relating to the highest paid director. As I have said, it is currently required to report to higher standards—the standards for quoted companies—which include the level of detail required by this amendment. That is appropriate because it is currently entirely publicly owned.
I have given considerable praise to the Green Investment Bank—[Interruption.] I have just been handed a note, which will doubtless be a blessing to everybody who, in due course, has the great good fortune either to read this in Hansard or to be following these proceedings. I will, if I may, pay tribute again to the bank and to all those who work for it, especially the chairman, the noble Lord Smith.
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In conclusion—[Interruption.] Cut it out. I certainly shall not forget the heckling of the hon. Member for Nottingham East (Chris Leslie).
The Government have listened—that is the most important point—to the concerns of hon. Members and noble Lords of all parties. We have been open and transparent about our intentions for the Green Investment Bank not only since June of this year, but as far back as the autumn statement in 2013 when we made our position clear. We want what is best for the Green Investment Bank, which is to increase its green impact with greater access to private sector capital. As Lord Smith said in his letter, he wants us to do it our way, and not the Opposition’s way, so that it has the access to equity that it so badly needs. We need to give it the freedom to continue doing what it does best, so I hope that all hon. Members will join me in the No Lobby to resist the new clause.
Kevin Brennan: The Minister criticised me in Committee for referring to people who work in the Office for National Statistics as boffins. May I remind her that a boffin, according to Wikipedia and the Oxford English Dictionary, is a person engaged in technical research? In fact, the term originates from the war-winning researchers of world war two, so I do not think that I have anything to apologise for in describing them as boffins. We have been looking for a guarantee that the mechanism that the Government are proposing would indeed satisfy the ONS. The Minister has confirmed on the Floor of the House today that she cannot offer that guarantee to us. We do not want to let this legislative opportunity pass by to ensure the green purposes of the Green Investment Bank. On that basis, I will be asking my right hon. and hon. Friends to join me in the Lobby as I seek to divide the House on new clause 4.
Question put, That the clause be read a Second time.
The House divided:
Ayes 202, Noes 284.
Division No. 206]
[
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AYES
Abrahams, Debbie
Alexander, Heidi
Allen, Mr Graham
Anderson, Mr David
Ashworth, Jonathan
Austin, Ian
Bailey, Mr Adrian
Barron, rh Kevin
Benn, rh Hilary
Berger, Luciana
Betts, Mr Clive
Blackman-Woods, Dr Roberta
Blenkinsop, Tom
Blomfield, Paul
Bradshaw, rh Mr Ben
Brennan, Kevin
Brown, Lyn
Brown, rh Mr Nicholas
Bryant, Chris
Burden, Richard
Burgon, Richard
Butler, Dawn
Byrne, rh Liam
Cadbury, Ruth
Campbell, rh Mr Alan
Carmichael, rh Mr Alistair
Champion, Sarah
Chapman, Jenny
Coaker, Vernon
Coffey, Ann
Cooper, Julie
Cooper, Rosie
Cooper, rh Yvette
Corbyn, rh Jeremy
Cox, Jo
Coyle, Neil
Crausby, Mr David
Creagh, Mary
Cruddas, Jon
Cryer, John
Cummins, Judith
Cunningham, Alex
Cunningham, Mr Jim
Danczuk, Simon
David, Wayne
De Piero, Gloria
Debbonaire, Thangam
Donaldson, rh Mr Jeffrey M.
Doughty, Stephen
Dowd, Jim
Dowd, Peter
Dromey, Jack
Dugher, Michael
Durkan, Mark
Eagle, Ms Angela
Eagle, Maria
Edwards, Jonathan
Efford, Clive
Elliott, Julie
Ellman, Mrs Louise
Esterson, Bill
Evans, Chris
Field, rh Frank
Fitzpatrick, Jim
Fletcher, Colleen
Flint, rh Caroline
Flynn, Paul
Fovargue, Yvonne
Gardiner, Barry
Glass, Pat
Glindon, Mary
Godsiff, Mr Roger
Goodman, Helen
Green, Kate
Greenwood, Lilian
Greenwood, Margaret
Griffith, Nia
Gwynne, Andrew
Haigh, Louise
Hayes, Helen
Hayman, Sue
Healey, rh John
Hendrick, Mr Mark
Hillier, Meg
Hodge, rh Dame Margaret
Hodgson, Mrs Sharon
Hollern, Kate
Hopkins, Kelvin
Howarth, rh Mr George
Hunt, Tristram
Jarvis, Dan
Jones, Gerald
Jones, Graham
Jones, Helen
Jones, Mr Kevan
Jones, Susan Elan
Kane, Mike
Kaufman, rh Sir Gerald
Keeley, Barbara
Kendall, Liz
Kinahan, Danny
Kinnock, Stephen
Kyle, Peter
Lamb, rh Norman
Lavery, Ian
Leslie, Chris
Lewell-Buck, Mrs Emma
Lewis, Clive
Lewis, Mr Ivan
Long Bailey, Rebecca
Lucas, Caroline
Lucas, Ian C.
Lynch, Holly
Mactaggart, rh Fiona
Madders, Justin
Mahmood, Mr Khalid
Mahmood, Shabana
Malhotra, Seema
Mann, John
Marris, Rob
Marsden, Mr Gordon
Maskell, Rachael
Matheson, Christian
McCabe, Steve
McCarthy, Kerry
McDonagh, Siobhain
McDonald, Andy
McDonnell, John
McFadden, rh Mr Pat
McGinn, Conor
McGovern, Alison
McInnes, Liz
McKinnell, Catherine
McMahon, Jim
Meale, Sir Alan
Mearns, Ian
Miliband, rh Edward
Moon, Mrs Madeleine
Morden, Jessica
Morris, Grahame M.
Mulholland, Greg
Nandy, Lisa
Onn, Melanie
Onwurah, Chi
Osamor, Kate
Owen, Albert
Pearce, Teresa
Pennycook, Matthew
Perkins, Toby
Phillips, Jess
Pound, Stephen
Powell, Lucy
Pugh, John
Reed, Mr Jamie
Reed, Mr Steve
Rees, Christina
Reeves, Rachel
Reynolds, Emma
Reynolds, Jonathan
Ritchie, Ms Margaret
Robinson, Mr Geoffrey
Rotheram, Steve
Ryan, rh Joan
Saville Roberts, Liz
Shah, Naz
Shannon, Jim
Sharma, Mr Virendra
Sheerman, Mr Barry
Sherriff, Paula
Siddiq, Tulip
Simpson, David
Skinner, Mr Dennis
Slaughter, Andy
Smeeth, Ruth
Smith, rh Mr Andrew
Smith, Nick
Smyth, Karin
Spellar, rh Mr John
Stevens, Jo
Streeting, Wes
Stringer, Graham
Stuart, rh Ms Gisela
Tami, Mark
Thomas, Mr Gareth
Thornberry, Emily
Timms, rh Stephen
Trickett, Jon
Turley, Anna
Twigg, Derek
Twigg, Stephen
Vaz, rh Keith
Vaz, Valerie
Watson, Mr Tom
West, Catherine
Whitehead, Dr Alan
Williams, Hywel
Williams, Mr Mark
Winnick, Mr David
Winterton, rh Dame Rosie
Woodcock, John
Wright, Mr Iain
Zeichner, Daniel
Tellers for the Ayes:
Vicky Foxcroft
and
Jeff Smith
NOES
Adams, Nigel
Afriyie, Adam
Aldous, Peter
Allan, Lucy
Allen, Heidi
Andrew, Stuart
Ansell, Caroline
Argar, Edward
Atkins, Victoria
Bacon, Mr Richard
Baker, Mr Steve
Baldwin, Harriett
Barclay, Stephen
Baron, Mr John
Bebb, Guto
Bellingham, Sir Henry
Benyon, Richard
Beresford, Sir Paul
Berry, Jake
Berry, James
Bingham, Andrew
Blackman, Bob
Boles, Nick
Bone, Mr Peter
Borwick, Victoria
Bottomley, Sir Peter
Bradley, Karen
Brady, Mr Graham
Brazier, Mr Julian
Bridgen, Andrew
Brine, Steve
Brokenshire, rh James
Bruce, Fiona
Buckland, Robert
Burns, Conor
Burns, rh Sir Simon
Burrowes, Mr David
Burt, rh Alistair
Cairns, Alun
Carmichael, Neil
Carswell, Mr Douglas
Cartlidge, James
Cash, Sir William
Caulfield, Maria
Chalk, Alex
Chishti, Rehman
Chope, Mr Christopher
Churchill, Jo
Clark, rh Greg
Cleverly, James
Coffey, Dr Thérèse
Collins, Damian
Colvile, Oliver
Costa, Alberto
Crabb, rh Stephen
Davies, Byron
Davies, Chris
Davies, David T. C.
Davies, Glyn
Davies, Dr James
Davies, Mims
Dinenage, Caroline
Djanogly, Mr Jonathan
Donelan, Michelle
Dorries, Nadine
Double, Steve
Dowden, Oliver
Doyle-Price, Jackie
Drax, Richard
Drummond, Mrs Flick
Duncan, rh Sir Alan
Duncan Smith, rh Mr Iain
Dunne, Mr Philip
Ellis, Michael
Ellwood, Mr Tobias
Elphicke, Charlie
Eustice, George
Evans, Graham
Evennett, rh Mr David
Fabricant, Michael
Fallon, rh Michael
Fernandes, Suella
Field, rh Mark
Foster, Kevin
Fox, rh Dr Liam
Francois, rh Mr Mark
Frazer, Lucy
Freeman, George
Freer, Mike
Fuller, Richard
Fysh, Marcus
Garnier, rh Sir Edward
Gauke, Mr David
Ghani, Nusrat
Gibb, Mr Nick
Gillan, rh Mrs Cheryl
Glen, John
Goodwill, Mr Robert
Gove, rh Michael
Graham, Richard
Grant, Mrs Helen
Gray, Mr James
Grayling, rh Chris
Green, Chris
Green, rh Damian
Grieve, rh Mr Dominic
Griffiths, Andrew
Gummer, Ben
Gyimah, Mr Sam
Halfon, rh Robert
Hall, Luke
Hammond, Stephen
Hancock, rh Matthew
Hands, rh Greg
Harper, rh Mr Mark
Harrington, Richard
Harris, Rebecca
Hart, Simon
Haselhurst, rh Sir Alan
Hayes, rh Mr John
Heald, Sir Oliver
Heappey, James
Heaton-Harris, Chris
Heaton-Jones, Peter
Henderson, Gordon
Herbert, rh Nick
Hinds, Damian
Hoare, Simon
Hollingbery, George
Hollinrake, Kevin
Hollobone, Mr Philip
Hopkins, Kris
Howarth, Sir Gerald
Howlett, Ben
Huddleston, Nigel
Hunt, rh Mr Jeremy
Jackson, Mr Stewart
James, Margot
Javid, rh Sajid
Jayawardena, Mr Ranil
Jenkin, Mr Bernard
Jenkyns, Andrea
Jenrick, Robert
Johnson, Boris
Johnson, Gareth
Johnson, Joseph
Jones, Andrew
Jones, rh Mr David
Jones, Mr Marcus
Kennedy, Seema
Knight, rh Sir Greg
Knight, Julian
Kwarteng, Kwasi
Lancaster, Mark
Latham, Pauline
Leadsom, Andrea
Lee, Dr Phillip
Lefroy, Jeremy
Leigh, Sir Edward
Letwin, rh Mr Oliver
Lewis, Brandon
Lewis, rh Dr Julian
Lidington, rh Mr David
Lilley, rh Mr Peter
Lord, Jonathan
Loughton, Tim
Lumley, Karen
Mackinlay, Craig
Mackintosh, David
Main, Mrs Anne
Mak, Mr Alan
Malthouse, Kit
Mann, Scott
Mathias, Dr Tania
May, rh Mrs Theresa
Maynard, Paul
McCartney, Jason
McCartney, Karl
McLoughlin, rh Mr Patrick
McPartland, Stephen
Mercer, Johnny
Merriman, Huw
Metcalfe, Stephen
Miller, rh Mrs Maria
Milling, Amanda
Mitchell, rh Mr Andrew
Mordaunt, Penny
Morris, Anne Marie
Morris, David
Morris, James
Morton, Wendy
Mowat, David
Mundell, rh David
Murray, Mrs Sheryll
Murrison, Dr Andrew
Nokes, Caroline
Norman, Jesse
Nuttall, Mr David
Offord, Dr Matthew
Opperman, Guy
Parish, Neil
Patel, rh Priti
Paterson, rh Mr Owen
Pawsey, Mark
Penrose, John
Percy, Andrew
Phillips, Stephen
Philp, Chris
Pickles, rh Sir Eric
Pincher, Christopher
Poulter, Dr Daniel
Pow, Rebecca
Prisk, Mr Mark
Pritchard, Mark
Pursglove, Tom
Quin, Jeremy
Quince, Will
Raab, Mr Dominic
Redwood, rh John
Rees-Mogg, Mr Jacob
Robinson, Mary
Rudd, rh Amber
Rutley, David
Sandbach, Antoinette
Scully, Paul
Selous, Andrew
Shapps, rh Grant
Sharma, Alok
Shelbrooke, Alec
Simpson, rh Mr Keith
Skidmore, Chris
Smith, Chloe
Smith, Henry
Smith, Julian
Smith, Royston
Solloway, Amanda
Soubry, rh Anna
Spelman, rh Mrs Caroline
Spencer, Mark
Stephenson, Andrew
Stevenson, John
Stewart, Bob
Stewart, Iain
Stewart, Rory
Streeter, Mr Gary
Stride, Mel
Sturdy, Julian
Sunak, Rishi
Swayne, rh Mr Desmond
Swire, rh Mr Hugo
Thomas, Derek
Throup, Maggie
Tolhurst, Kelly
Tomlinson, Justin
Tomlinson, Michael
Tracey, Craig
Tredinnick, David
Trevelyan, Mrs Anne-Marie
Truss, rh Elizabeth
Tugendhat, Tom
Turner, Mr Andrew
Tyrie, rh Mr Andrew
Vaizey, Mr Edward
Vara, Mr Shailesh
Vickers, Martin
Villiers, rh Mrs Theresa
Walker, Mr Charles
Walker, Mr Robin
Wallace, Mr Ben
Warburton, David
Warman, Matt
Watkinson, Dame Angela
Wharton, James
Whately, Helen
White, Chris
Whittingdale, rh Mr John
Wiggin, Bill
Williams, Craig
Williamson, rh Gavin
Wilson, Mr Rob
Wollaston, Dr Sarah
Wood, Mike
Wragg, William
Wright, rh Jeremy
Tellers for the Noes:
Simon Kirby
and
Sarah Newton
Question accordingly negatived.
8 Mar 2016 : Column 166
8 Mar 2016 : Column 167
8 Mar 2016 : Column 168
8 Mar 2016 : Column 169
Bodies excluded from the restrictions on public sector exit payments
“Payments made by the following bodies are excluded from the restrictions on public sector exit payments—
(b) Westinghouse Springfields Fuels Ltd,
(d) National Nuclear Laboratory,
(e) International Nuclear Services,
(f) Atomic Weapons Establishment Ltd,
(g) Low Level Waste Repository Ltd,
(h) Dounreay Site Restoration Ltd,
(j) RSRL Harwell.”—(Kevin Brennan.)
This new schedule would exclude employees of the listed companies operated by the private sector from the scope of the proposed cap on exit payments.
Brought up, and read the First time.
Kevin Brennan: I beg to move, That the schedule be read a Second time.
Madam Deputy Speaker (Mrs Eleanor Laing): With this it will be convenient to discuss the following:
Amendment 18, in clause 41, page 56, line 18, at end insert—
“(1A) The restriction placed on public sector exit payments must be reviewed at regular intervals and, where necessary, be adjusted in line with inflation and earnings growth.”.
This amendment would ensure that the level that the restriction on public sector exit payments is set will be linked to inflation and earnings growth.
Amendment 15, in clause 41, page 57, line 10, at end insert “, including payments relating to employees earning less than £27,000 per year”.
This amendment would provide that regulations may exempt from the public sector exit payment cap those earning less than £27,000.
Amendment 16, in clause 41, page 57, line 27, at end insert—
“(10A) Nothing in this section applies in relation to payments made by the bodies listed in NS1.”.
This amendment would exclude employees of companies listed in NS1 operated by the private sector from the scope of the proposed cap on exit payments.
Kevin Brennan: I am happy to confirm that the Opposition will be supporting amendment 18, tabled by the Scottish National party, which we discussed in Committee.
8 Mar 2016 : Column 170
This is the bit of the Enterprise Bill that has nothing to do with enterprise; it is largely about spin, to be perfectly honest. Let me make it clear, as I did in Committee, that Her Majesty’s official Opposition agree that excessive exit payments in the public sector should not be paid, and that any abuses in that regard should be ended. The problem with the Government’s approach is that they are attempting to govern by headline in a very complex area, and in so doing they are creating the sorts of anomalies and unfairnesses that I am sure we will hear about during this debate. Including a headline-grabbing figure—in this case £95,000—on the face of the Bill is, frankly, the worst kind of utterly vacuous government, and it is exactly the sort of rigid legislating that good civil servants advise against, and that bad Ministers promote.
The inclusion of that figure in the Bill is really about allowing the Secretary of State for Business, Innovation and Skills to have his tabloid headline about fat cats, which was one of the odious remarks he made on Second Reading. That was an insult to thousands of decent, hard-working people across this country, many of whom have never been paid anywhere near £30,000 a year, let alone the £3 million a year that the Secretary of State used to get when he worked for an investment bank. [Interruption.] That has a lot to do with it, because of the language he used.
If I was to accuse the Secretary of State of being a fat cat—I am not going to do that, Madam Deputy Speaker—the Minister would be huffing and puffing in her usual way, muttering “Outrageous” and “Disgraceful” from a sedentary position. She and the Secretary of State like to dish it out, but they do not like to take it when it comes back their way. She was quite content to sit there on Second Reading and cheer the Secretary of State on as he traduced public servants, including long-serving local librarians and even privatised nuclear decommissioning workers, and described them as fat cats. I wonder how they felt about the Secretary of State using that language. Actually, I know exactly how they felt, because they wrote to us in their droves to express their anger at his insulting rhetoric, and that evidence—there was a lot of it—was officially submitted to the Committee.
Amendment 15, tabled by the Opposition, seeks to protect those workers who earn less than £27,000 a year from the proposed exit payments cap—yes, those who earn less than £27,000 a year are the Secretary of State’s so-called fat cats.
Louise Haigh (Sheffield, Heeley) (Lab): I was present on Second Reading when the Secretary of State described long-serving public servants on low and average pay as fat cats. At the end of that debate, the Minister said at the Dispatch Box that the exit payments cap would not apply to civil servants earning less than £27,000. I hope that she will forgive us if we do not take her word for it, and that she will therefore accept our amendment today to ensure that the promise is in law.
Kevin Brennan:
There was a time when what Ministers said on the Floor of the House could be accepted, and I am prepared to accept that the Minister is sincere in what she has said. In fact, I am not sure that she said quite what my hon. Friend says she said. I think that she actually said that it could affect a small number of people on £25,000. However, I think that my hon. Friend is
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echoing what one of the Minister’s Treasury colleagues had said earlier. If I am not mistaken, the current Minister for Employment, the right hon. Member for Witham (Priti Patel), when referring to what would be in the Conservative party’s manifesto, said that the proposal would not affect anybody earning less than £27,000 a year. We have therefore taken her words, given as a promise from a Minister of the Crown, and put them into an amendment in order to hold the Government to their word. The fact that this Minister was not prepared to repeat that in those terms when she spoke on Second Reading can perhaps be explained by the Government’s refusal to support our very reasonable amendment.
Richard Fuller: Following the hon. Gentleman’s deliberations in Committee, and from his own analysis—obviously we are looking in the round at public expenditure on exit payments—can he advise the House on what proportion of that expenditure in, say, the last five years was for people earning less than £27,000, and what proportion was for people earning over £100,000?
Kevin Brennan: I do not have that figure to hand, but we did probe the Government to try to get some idea of what calculations they had made of the impact on people earning less than £27,000 a year. I am afraid we have not been able to elicit a great deal of information from them on that subject, other than that they think it would be rare for those people to be affected. If it is that rare—I will come to this in a moment—why do the Government not accept our amendment, because it will not actually cost them much?
Richard Fuller: The hon. Gentleman makes a fair point. In the absence of data, he has his good judgment and his reasonableness, following his many years in Government before 2010. Do his instincts not say that the majority of people will be earning in excess of £100,000? That really is the target of what the Government propose, is it not?
Kevin Brennan: That is what the Government say the target is. As the hon. Gentleman knows, I respect him greatly for his independence of mind and thought, and for his intellect on these matters. As I said at the outset, if abuses are going on in relation to public sector exit payments, we are perfectly willing to say they should be stopped, but we need to look at what the clause actually does. It picks the figure of £95,000 to generate a headline saying that the Bill will stop fat-cat public sector exit payments of more than £100,000. However, what it does not elucidate very well is that that £95,000 is not just a cash lump sum, but includes the so-called strain payments that are paid into workers’ pension funds when they are forced into redundancy before retirement age. That is money they will never get in their pockets—they are not walking away with £95,000. They are not fat cats earning more than £100,000, and some are on relatively modest incomes. The Bill will also capture many people in the private sector, which the Government were also not keen to elucidate on.
Chris Stephens (Glasgow South West) (SNP): Will the shadow Minister confirm that the employees affected, who will be earning less than £25,000 a year, will be predominantly women? This being International Women’s Day, perhaps the Government should think again.
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Kevin Brennan: The hon. Gentleman is absolutely right. Clearly, large numbers of public sector workers, who have often given long service, might have to take redundancy—not surprisingly at a time of severe cuts in, for example, local government. The provisions in the local government pension fund require those strain payments to be made, and those will count towards the £95,000 exit payment.
Catherine McKinnell (Newcastle upon Tyne North) (Lab): My intervention very much complements that of the hon. Member for Glasgow South West (Chris Stephens). One of the big concerns about the change, which I am sure my hon. Friend shares, is that the consultation was so inadequate. The Government have also failed to undertake any public sector equality duty review, as required under the Equality Act 2010. The changes could therefore have many unintended consequences, but the Government are not taking the time to explore them.
Kevin Brennan: Yes. I will briefly touch on the inadequacy of the consultation later.
Amendment 15 is about workers earning less than £27,000 a year. As I mentioned, it was the right hon. Member for Witham (Priti Patel), when she was at the Treasury, who said a year ago:
“those earning less than £27,000 will be exempted to protect the very small number of low earning, long-serving public servants.”
She was commenting on the Government’s plans to create the public sector exit payment cap.
Chris Philp (Croydon South) (Con): Did the Minister for Small Business, Industry and Enterprise not take the Committee through a number of worked examples demonstrating that the Bill would not have the adverse effect on pensions that is suggested? For example, a prison officer earning £28,000 a year with 34 years’ experience could still retire at as young as 52 without being affected. Does that not illustrate that the hon. Gentleman’s concerns are not terribly well founded?
2.45 pm
Kevin Brennan: I recommend that the hon. Gentleman read more deeply into the report of the Committee stage. I commend to him the worked example I gave of somebody on a salary of £25,000 who had given long service in local government and who would be affected.
Obviously, the right hon. Member for Witham did not think at the time that these people were fat cats; she thought they should be protected, and we need to understand why that is not happening in the Bill. Why was a lower earnings floor not included, given that the Conservatives promised they would pursue only—again, I quote from their manifesto—the “best paid” workers? Of course, once the election was over, the Government ignored that.
Problems emerged because the consultation was so poorly conducted, as my hon. Friend the Member for Newcastle upon Tyne North (Catherine McKinnell) said. Usually, a full consultation takes 12 weeks; the Government did this consultation over four weeks in the summer—it began on 31 July 2015 and concluded on 27 August. If the Government were serious in their rhetoric that the Bill would affect only the best paid, it
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would be very straightforward to include a provision to exclude those on £27,000 or less. In fact, what the Minister for Small Business, Industry and Enterprise said on Second Reading, which was alluded to earlier, was:
“What we do know is that there is a very small number of workers”—
“in the public sector on about £25,000 who could be caught by this…But those are extremely rare conditions.”—[Official Report, 2 February 2016; Vol. 605, c. 886.]
What we want to know, therefore—I think this is what the hon. Member for Bedford (Richard Fuller) wanted to know—is how rare those conditions are. If they are that rare, why not exempt the lower paid?
Catherine McKinnell: My hon. Friend briefly mentioned the dates of the consultation—between July and August. Does it not occur to him that if the Government were genuinely keen to hear back from people potentially affected by, or interested in, this change, they would not have introduced the consultation for such a short time over the summer holidays?
Kevin Brennan: My only assumption is that they think fat cats should not have holidays. That is probably why they thought it did not matter that there was only a four-week consultation. That is what they think of the people they were supposed to be consulting. The rhetoric used by the Government is shameful; the contemptuous, short nature of the consultation is shameful; and the way in which the policy has been introduced overall can only be described as shameful.
We are concerned about the Government’s reluctance to make the necessary exemptions to ensure that the unfortunate few—that is what the Government tell us they are: a few—are not disproportionately affected. If the low paid and average paid are affected only in rare circumstances, excluding them from the cap will not result in the Government losing a great deal of money, so what is the problem in exempting them?
Richard Fuller: I am listening intently to the hon. Gentleman. I was in the Committee, and I am wondering whether there may be a flaw in his argument—no pun intended. If we put the floor in at £27,000, what about the person at £28,000? How would we distinguish between the different groups? Is it not better to set a limit to the payment that is made and to be blind on the income that someone gets up to that limit?
Kevin Brennan: I understand the point the hon. Gentleman is making. That would be all right if it was truly a payment that people were going to get in their pocket. The reason these people are captured, however, is that the figure includes the so-called strain payments that are made into the pension fund if they are made redundant before their normal retirement age. That is the unfairness, and that is the reason why, I presume, that the former Treasury Minister said that no one on under £27,000 should be affected. The Opposition have simply taken what the Government originally said their intention was, as elucidated by a Minister of Her Majesty’s Treasury, and put it in our amendment to test why the Government are not acting on what was said.
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On Report in the Lords, Baroness Neville-Rolfe indicated that a drop of £500 would not be disproportionate for someone previously entitled to a pension of £12,500—the implication is that there could be a fall in the pension paid ultimately. All I would say is that a 4% drop in income for somebody on a relatively small income—it is lower, after all, than what one would receive on the minimum wage—would be highly significant on that low income. To say that a 4% cut is not significant is hugely out of touch with the reality of many people’s lives.
The Government’s case is that a leaving payment of £95,000 or above is a large amount for any employee, but they are perpetrating the myth that people will actually receive that money. Employees on low to average incomes will never see a large amount, because the payment includes compensation paid to the pension scheme. In fact, some of them will never even receive their pension, so they will never see that money in any way, shape or form.
The cap includes strain payments, and the pension shortfall is adjusted at the time of redundancy. Strain payments could make up a considerable amount of the £95,000. If so, long-serving, loyal workers could finish work with a significant shortfall in the amount that should have been allocated to them to deal with redundancy, unemployment and uncertainty. They will be left with little in their redundancy payment to pay for annuities to provide long-term security. I do not think that was the Government’s original intention, but the fact that they have refused to respond to the concern makes me wonder whether I am right about that.
We have been told that the Chancellor has withdrawn his pensions proposals, which would have raised £10 billion to pay down the deficit. In other words, he has moved swiftly so as not to offend better-off pensioners who might have been hit by the proposals. Why, then, will the Government not turn their hand to those who earn less than £27,000 a year, whose redundancy and access to a pension are threatened by the exit payment cap? The Chancellor has famously said that we are all in this together and that those with the broadest shoulders should bear the biggest burden, so the Government have a chance to prove that by supporting our amendment 15, which is, after all, based on their own words.
Amendment 16 would exclude from the provision employees of the companies listed in new schedule 1, which are operated by the private sector. Those who would be affected are principally employees of companies across the nuclear estate and elsewhere in the private sector, such as Magnox. Why are they affected by a measure that the Secretary of State told us on Second Reading is designed to hit “public sector fat cats”? According to the Secretary of State, Magnox workers who work in the private sector are “public sector fat cats”.
Liz Saville Roberts (Dwyfor Meirionnydd) (PC): When companies such as Magnox were privatised, workers such as those at Trawsfynydd in Dwyfor Meirionnydd lost access to their public sector pension scheme, but they are now going to be included in a cap on public sector redundancy payments. Does the shadow Secretary of State agree that the Treasury is trying to have its cake and eat it at the expense of those workers?
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Kevin Brennan: I thank the hon. Lady for promoting me temporarily. I agree with her, and I know that she has been campaigning on that issue, as has my hon. Friend the Member for Ynys Môn (Albert Owen), who we may hear from later. She is absolutely right. The employees of these companies would never have imagined for one second that they would be hit by the Government’s proposals and the Conservative manifesto commitment to cap public sector exit payments. We raised the issue in Committee, but the Minister refused to guarantee that they would be excluded from the exit payment cap.
The companies listed are in a unique position. They are mostly engaged in managing the safe closure of nuclear facilities, which is a task of huge national importance. By its very nature, it involves working towards a specific end date, at which point the employees will effectively make themselves redundant, provided that they have done a good job. That is what they are doing: they are working to make themselves redundant.
Sue Hayman (Workington) (Lab): Does my hon. Friend agree that it is completely inconsistent to include employees of companies operated by the private sector? My constituents who work at Sellafield are very worried about the proposed redundancy cap. I am concerned that it will lead to highly skilled, experienced workers leaving the industry, which would undermine our ability to deliver the safe decommissioning of our nuclear facilities.
Kevin Brennan: I agree. My hon. Friend will have noticed that Sellafield Ltd is included in new schedule 1, for the very reason she has highlighted.
As I said, the workers in question are working towards making themselves redundant. They accept that their work is a task and finish activity of national importance. In order to get somebody with the necessary skills to commit to that kind of proposition in their early or mid-30s, we need to ensure that they know that they will be provided for if they successfully complete their task by the time they reach their mid to late 50s, when they might find it extremely difficult to find re-employment, given their very specific skills.
If the companies listed cannot afford the packages necessary to compensate someone for the loss of their role when their task has been completed, they will find it extremely difficult to prevent highly skilled workers, who are mobile in the earlier parts of their careers, from leaving. That in itself will drive up costs for the nuclear decommissioning industry and exacerbate an already difficult skills shortage in the sector.
Legislating now to override the long-standing arrangements in the nuclear industry, as the Government are doing, when employers have kept their end of the bargain faithfully, is, to be frank, unconscionable. How can it be right that workers who have stayed with a company to deliver successfully the safe decommissioning of a site see the Government renege on their promised redundancy compensation when it is due to be paid?
Catherine McKinnell:
My hon. Friend’s argument is powerful, and I am genuinely at a loss as to why the Government do not take heed of it. The proposal will not only cost individuals in the long term; it is also a betrayal of trust and will only benefit, to a small degree,
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the company involved. It will not actually benefit the Government, so I do not understand why they do not take action to right what is clearly a wrong.
Kevin Brennan: Exactly. The Treasury’s justification is that, even though the companies have been privatised, the workers are still deemed by the Office for National Statistics to be on the Treasury books, because of the nature of their work. It is understandable that their work needs to be underwritten by Government, because they are decommissioning nuclear sites and no one can get an insurance policy for that.
That technical, statistical designation, however, does not mean that applying the cap to those workers is fair or that it necessarily represents value for money for taxpayers in the long term. There is no proof that taxpayers will receive any benefit, as the private operators of the companies often receive higher incentive payments in their contracts as a result of this kind of change. Unless the Government decide to act, employees in the sector will note that the Treasury has excluded them from the public sector when it comes to pension provision and other issues, but considers them within the scope of the capped exit payments.
Catherine McKinnell: If the Government fail to take heed of this issue and that of the pensions of women who were born in the 1950s, I think that the mantra for the 2020 election will be, “You cannot trust the Tories on pensions.”
Kevin Brennan: My hon. Friend is absolutely right. I hope that the Government will have a last-minute change of heart. Why is a privatised banker not given the fat cat treatment under these provisions?
Chris Philp: Will the shadow Minister give way?
Kevin Brennan: I will in a moment, but first I will repeat my question, just in case Members did not hear it: why is a fat cat banker not being given the same treatment as nuclear decommissioning workers?
Chris Philp: The shadow Minister well knows that the Government have capped the pension contributions of higher earners at £44,000 a year, and that those on the highest incomes of more than £200,000 have had their contributions capped at £10,000 a year. The Government have taken a lot of action in this area, as the shadow Minister well knows.
Kevin Brennan: What the hon. Gentleman may not realise is that the workers of the banks that have been taken into public ownership will be specifically excluded from the exit payments cap under the Government’s plans. That might change his mind, so he might like to join us in the Lobby later. Yet again, it seems to be “Up with the bankers and down with the workers”. What a shocking value-free zone this policy is, if the Government stick to it.
3 pm
We have received strong representations on the matter from Magnox workers, from trade unions including Unite and Prospect, and directly from the workers.
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The bodies that we have included in new schedule 1, which are affected by the “public sector fat cat” policy, are Sellafield Ltd, Westinghouse Springfields Fuels Ltd, Magnox Ltd, the National Nuclear Laboratory, International Nuclear Services, Atomic Weapons Establishment Ltd, Low Level Waste Repository Ltd, Dounreay Site Restoration Ltd, RSRL Winfrith and RSRL Harwell. I note that none of the companies in that list is called “Fat Cats Ltd”, but they are all included on the list of companies with workers that the Government are, by their own admission, treating as fat cats.
The Public Bill Committee received dozens of letters from Magnox workers, and I congratulate them on the quality of the representations that they made. I quoted in Committee from a letter from one of the workers, and I will quote it briefly again. Ian Milligan, who works at Bradwell as a waste engineer, said:
“I should like to start with a definition quoted from the Oxford English Dictionary, the dictionary that has sat on my desk for the duration of my career within the Nuclear Industry which has spanned over 20 years. The question I had was, what does the term a fat cat infer? The answer: A Fat Cat—a wealthy person, a highly paid executive or official.”
“I, and many of my work colleagues employed by Magnox Ltd, are likely to be ‘caught’ in the proposed Exit Payment Cap of the Enterprise Bill, to which I, and my work mates across the board were shocked to discover, as we are ordinary working class people and do not consider ourselves to be Fat Cats by any stretch of the imagination.”
Chris Stephens: Will the shadow Minister confirm that on Second Reading, the Secretary of State used the term “public sector fat cats” in his closing remarks in support of the Bill? Is that not in contrast to the workers whom the shadow Minister is talking about, who work in a physically taxing environment for many years?
Kevin Brennan: The hon. Gentleman is absolutely right. I know that it is difficult to believe—presumably, that is why the hon. Gentleman had to check before making his intervention—but the Secretary of State actually said that the measure was intended to hit fat cats in the public sector, which therefore includes everybody affected by it.
This confirms the understandable anger that is out there. My hon. Friend the Member for Ynys Môn might add examples of workers from his constituency. Agreements have been made and guarantees have been given. We were told that the provision was to hit public sector fat cats, not employees in the private sector. We have tabled the new schedule, which would exempt the companies listed from the Bill. If the Minister has another way of doing it, as I said to her in Committee, I would be interested to hear it. In Committee she was not able to offer any comfort whatever to the workers of the companies listed in new schedule 1. Her response was disappointing, given the weight of evidence submitted to the Committee and the strength of feeling among hon. Members and their constituents. Workers have made their plans and taken life decisions on the basis of promises that were made to them. As far as we can surmise from the limited information that the Minister
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is prepared to provide about the Government’s intentions, the Government are going to take action that will affect those workers.
In Committee, the Minister rehearsed arguments about all sorts of scares that may have been put about by mythical people whom she was not prepared to name, but going by the evidence submitted to us, the workers in question will be affected to quite a large extent. We represented the workers’ arguments in Committee and made their case on their behalf, but all we got from the Minister was a response to issues that had not been raised in the workers’ letters or, indeed, by us, and a vague reference to secondary legislation at some later date that will name some as yet unknown entities that may be excluded from the cap. In other words, all we got was an empty sheet of paper. I am afraid that that is not good enough.
We in the House need to know what the Government’s intentions are, and we need to be able to tell constituents who have written to us, and who are directly affected, whether they will be hit by the exit payment cap. Those hard-working people are the definition of strivers. They are the beating heart of this country. Their letters reveal that they are not swivel-eyed lefty loonies or fat cats but ordinary working people, many whom live in the constituencies of Conservative Members.
Ministers have put things in the Bill that are meant to get them a headline in the Daily Mail and The Sun. That is fundamentally why the proposal is so flawed. The reality, when we lift the stone and look underneath, is that it will affect all sorts of people whom the Government did not indicate that they intended to hit. Hard-working people are being betrayed by their Government. They would have made very different assumptions about what this policy meant when they read the Daily Mail headline or even the Conservative party manifesto. That is why, if the Government will not stand up for those workers, we will.
Sir Gerald Howarth (Aldershot) (Con): I am pleased to follow the shadow Minister, the hon. Member for Cardiff West (Kevin Brennan). I have constituents who work at the Atomic Weapons Establishment in Aldermaston, at the Defence Science Technology Laboratories in Porton Down and elsewhere, so I have an enormously high regard for those extraordinary public servants who contribute so much to the security of our country. I therefore have some sympathy with new schedule 1.
It is easy for the newspapers to produce graphic headlines such as “Civil service pen-pushers get massive pay-offs”, but I am talking about slightly different people. They are not ordinary people in the sense the shadow Minister was talking about; they are really rather special. They work at the forefront of technology to ensure that the nation remains safe and that our realm remains secure. I know from talking to my constituents that people at the AWE, which has been privatised, are very unhappy indeed. The AWE is a unique and important facility. It is the only place capable of designing and producing the successor to our Trident nuclear missile system, and indeed of maintaining Trident until its successor comes into force. I am told that morale at the AWE is at rock bottom. To remove the last major benefit of working there—pay has been historically low because of the decent benefits—risks the nuclear deterrent, in some people’s opinion.
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These people are not the only ones to be affected. A constituent of mine who works at DSTL came to see me at my surgery on Saturday. He is a leading scientist, and he brought with him examples of ceramic armour that he had personally developed for the protection of our troops. I do not know how many Members in the Chamber have been to see any of our defence science laboratories. I represent Farnborough, the home of the former Royal Aircraft Establishment, which is now the headquarters of QinetiQ. I have met some of its employees, who used to work in some pretty shabby conditions—no wall-to-wall carpeting, rubber plants or anything of the sort—although they have rather fine offices now in Farnborough, and I have been struck by the fact that they could get a lot more money in the private sector. When I asked them, “Why do you work here?” they replied, “Because we want to give something back to our country.” Those scientists show an extraordinary sense of patriotism, dedication and loyal commitment to our country; in my view, they contribute disproportionately to the defence of the realm.
My constituent told me on Saturday that for decades he had been
“Paying my taxes…Saving hard…Avoiding debt…Obeying the law”
and, of course, “Working hard” to develop these life-saving technologies for members of our armed forces. He went on to say:
“in spite of this…I have received below inflation pay rises since 2004…My pension contributions have doubled…My retirement age has increased from 60 to 67...My redundancy terms & conditions have been degraded significantly…My pay is now 20% lower than MOD colleagues outside of Dstl”.
He drew my attention to the 2015 review of the MOD’s science and technology capability by Sir Mark Walport, the Government’s chief scientific adviser, who said:
“We understand that staff retention is difficult in the mid-career stage. We were surprised that Dstl are able to retain staff (let alone good staff) given the comparative low-pay offered.”
Conditions have not improved owing to the austerity measures that we have had to take, which I understand, but that did not stop the chief executive of DSTL receiving a 30% remuneration increase. In those circumstances, it is understandable that these people do not feel that they have been treated as well as they should have been. The other point about them is that, as Crown servants and the kind of people they are, they do not go around protesting; they come to our surgeries or write us a private letter. They will not write to the national newspapers or stand outside with a placard, because they just want to get on with their jobs. I say to my right hon. Friend the Minister that there is a risk that we may be taking for granted people whose contribution to our national security is, as I said, rather significant.
Mark Field (Cities of London and Westminster) (Con): My hon. Friend is absolutely right. Instinctively, I am entirely sympathetic to his argument, which applies to not just Crown employees, but those in the security services. However, could not his argument about such concerns easily be made about everyone working in the public sector? That is why the Government’s instinctive view is against drawing the distinction that he would like to make.
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Sir Gerald Howarth: I have enormous respect for my right hon. Friend and I understand his point, but the place I represent is the home of the British Army, as well as the birthplace of British aviation, and it is steeped in technology. I know these people—I did so when I was a Defence Minister, as I have throughout my constituency experience in Aldershot—and I value them. I am afraid that I think they are rather special and that they have been neglected. I have specifically pointed out that their grades have not been made up to MOD grades, because they are busy in their laboratories doing what they like doing—inventing and helping to protect us all—so I will not resile from singling them out. My hon. Friend is entirely right to say that I am doing so, but I hope he will accept my apology for that.
David Mowat: The point about the entire public sector is a reasonable one, but it would be stronger if the Government had not specifically exempted parts of the public sector, namely those in the City of London, such as the privatised banks, and particularly the compensation schemes in what are public sector bodies, such as the Financial Conduct Authority.
Sir Gerald Howarth: My hon. Friend makes a good point.
Mark Field: My hon. Friend the Member for Warrington South (David Mowat) will appreciate that the intention is that many of the parts of the City of London that are currently in the public sector will not be there for very long. The idea is to get them out of the public sector in double-quick time. I should say to my hon. Friend the Member for Aldershot (Sir Gerald Howarth) that I am the son of Army soldier. In my younger life, I lived in Aldershot, as well as in Fleet, which used to be in his constituency, and I have a lot of sympathy with what he says. I am not in any way trying to fob him off. I totally agree about those in military service and our intelligence services, many of whom could get multiples of what they earn if they left GCHQ, for instance, to work in the private sector. None the less, if we are to draw a line, perhaps we should draw it in a sensible place; otherwise, we should not draw it at all.
Sir Gerald Howarth: As my hon. Friend the Member for Warrington South (David Mowat) implies, the sensible place to draw the line would include these people on the list of exemptions, but there we go.
3.15 pm
Earlier today, I had a meeting with officials from Prospect. They acknowledge that one of our manifesto commitments was to
“end taxpayer-funded six-figure payoffs for the best paid public sector workers.”
They accept that the Government have a mandate for that, but it is worth putting what they say on record—forgive me for doing so, Mr Deputy Speaker—because they feel that the Government did backtrack on the agreement signed in 2010. They use the word “renege”, but let me say “backtrack”. They say:
“The current civil service redundancy terms were agreed by Prospect and other civil service unions and the last Minister for the Cabinet Office”—
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“just four years before the Conservative party’s announcement that it would seek to renege on that agreement. The minister stated at the time: ‘what the new scheme shows is that constructive negotiations with the unions can work and the result is a package that is fair for civil servants and fair for other taxpayers’. He also said: ‘I believe we now have a scheme which is fair, protects those who need the most support, addresses the inequities in the current system and is right for the long term.”
I put it to my right hon. Friend the Minister that, despite the use of the phrase
“right for the long term”,
the scheme has not lasted more than six years. I will not vote against the Government today, but I urge her to have a discussion with the Treasury to determine whether this matter can be looked at again, because it is not fair on some of our most dedicated scientists who, as I say, are working to keep us secure.
Alan Brown (Kilmarnock and Loudoun) (SNP): I rise to speak to amendment 18, which is in my name and that of my hon. Friend the Member for Livingston (Hannah Bardell). The amendment perfectly complements amendment 15, which would add specific protections to part 9. As the hon. Member for Cardiff West (Kevin Brennan) said, as it stands, and given the rhetoric accompanying it, part 9 is a classic populist move by the Tory Government. They are playing up to the perception of fat cats, saying that people get huge pay-outs that are not comparable with private industry pay-outs, but they are not taking account of long-serving, lower-paid workers.
As I have implied, there is a lot of smoke and mirrors behind this scheme. The £95,000 cap includes pension payments that go not to the workers, but to the pension funds, including in the form of strain contributions for those on ill-health retirement. It is absolutely amoral that somebody who has to retire on the grounds of ill health, having worked hard, perhaps in a manual job, will have their pension capped because of this scheme.
I really do not understand how the Government cannot recognise the impact of the scheme. It was interesting that the House of Lords asked for an impact assessment, but it was not forthcoming. Back Benchers have asked the shadow Minister about the impact, but it is not for Opposition Members to provide that; it is the Government’s responsibility to do so at the outset.
The Government have admitted that this provision could affect workers who earn less than £25,000, which includes librarians, midwives, NHS workers and other long-serving employees. Those people are worlds away from the horror stories that we sometimes read about failed chief executives who walk away with massive lump sums. I understand a curb on pay-outs for those people. Even worse, some people receive a massive pay-out and then pop up in another council as a highly paid consultant. Again, I agree that there should be cap on that. I also suggest that the situation I have outlined is more of a problem in England, given that Scotland has only 32 local authorities, but I understand the concept of trying to control that.
The sum of £95,000 is a lot of money but, to put it in perspective, it is only three and a half years of an average salary, and a pay-out potentially puts someone out of the marketplace for good. We already know that many women who have previously taken early retirement are now suffering financially because they were not informed about the increase in the state pension age.
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Those women are now being forced into work programmes, but they are struggling to get back into work, which illustrates how difficult it can be to get back into work at a certain age. We should not be imposing exit caps that affect life choices for lower-paid workers who are trying to weigh up their options, given their realisation that they will have to work much longer than they had planned or been notified about by the DWP.
This provision will also hit middle-income earners, who are not meant to be the target. The local authority that I belonged to periodically operated a teacher refresh scheme to allow older, more experienced teachers to be considered for early retirement and replaced by younger teachers. That represents a virtuous circle of creating vacancies for young teachers, protecting the pensions of retiring teachers, and saving the taxpayer money overall due to the lower wages that are paid to new starts. Good governance is needed, not an exit cap that, in its current format, is too much of a blunt instrument.
Given the forced austerity that has been imposed on us, the Scottish Government have implemented a policy of no compulsory redundancies. In Scotland there have been zero compulsory redundancies in the NHS, but in England there have been more than 17,000 since 2010. If the Government really want to play the popularity game, as the hon. Member for Cardiff West said, they should extend this measure to other publicly supported companies, such as those banks with public money behind them. It beggars belief that we have a Chancellor who will stick up for annual bankers’ bonuses against the rest of Europe, but is happy to stand back on important matters such as exit payments and to let lower-paid workers suffer.
Peter Grant (Glenrothes) (SNP): My hon. Friend mentioned the Scottish Government’s record on avoiding compulsory redundancies. In my previous experience as the leader of one of Scotland’s biggest councils, we could not have managed the substantial reduction in our workforce without compulsory redundancies if we had not had the flexibility to offer severance packages that were proportionate to the service that people had delivered. Without that ability, councils in Scotland would have faced large numbers of compulsory redundancies that would have been inhumane in our workforce.
Alan Brown: I agree with that fine point completely. I went through the same experience as a local councillor on East Ayrshire Council. Although some of the payments made would be caught up by this payment cap, they were demonstrated to be value for money because of the payback period of two years. We were able to show good value for the taxpayer.
The Minister for Employment originally pledged to protect workers earning less than £27,000. Amendment 15 would allow that protection to be put in place, while amendment 18 would allow the cap to reviewed and increased in line with inflation. As the Bill stands, that cap is another part of the ongoing erosion of terms and conditions, given that inflation levels and the cost of living is clearly going to rise. The measures allow the Government to maintain a charade of being a party for workers. That is why we will push amendment 18 to a vote, and hopefully the party of workers on the Government Benches will support us.
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Albert Owen (Ynys Môn) (Lab): I congratulate my hon. Friend the Member for Cardiff West (Kevin Brennan) and the hon. Member for Aldershot (Sir Gerald Howarth) on the eloquent way in which they spoke to new schedule 1. I will not repeat what I said on Second Reading, except to reiterate the point that the people and companies listed in that new schedule are in no way fat cats. I think we need an apology from the Government about that because these are hard-working, ordinary people who have worked in difficult circumstances for many years, and signed up to agreements in good faith with the Government of the day.
I want the Government to honour their promise to safeguard the conditions of service that were agreed between companies and employees over many years, and I will touch on the definition of public sector workers. In no way are the people listed in the schedule public sector workers. Many of them work for private companies. If this cap is imposed on them, it will not benefit the Treasury at all; it will benefit the private companies that have taken on the contract. There will be no great saving, but there will be a breach of trust, and a considerable loss to those individuals who have been given protection.
I know that this Minister listens to reason and I am sure she agrees that many people will be caught unintentionally under the Bill. The protected status goes back to the privatisation of the electricity industry in the 1980s, and regulations were introduced in 1990 to protect many of the categories listed. More than 120 Magnox workers have written to me. As the hon. Member for Aldershot (Sir Gerald Howarth) said, they were given protection, with other nuclear industry employees, under schedule 8 to the Energy Act 2004. When the recent pensions Bill was going through Parliament and their conditions were threatened when a vote in the House of Commons took away their protected rights, an amendment in the House of Lords restored that protection. Those protections were given to the workers by Mrs Thatcher and Cecil Parkinson in the 1980s, and they were honoured by other Conservative Ministers.
Sue Hayman: It is also important to point out that the Treasury did not actually allow the employees of those companies to remain in public sector pension schemes when they were privatised, so it is completely inconsistent now to call them in.
Albert Owen:
There is huge inconsistency because the workers I am referring to were protected in 2004. They were given that protection in statute. The Government are using a crude analysis by the ONS that these are public sector workers and fat cats, and that they should be treated all the same, but they are breaking their own promises. That is the strong feeling I got in the letters I received from the employees. The safeguards given by previous Governments during privatisation are now being taken away on a whim. I say to Conservative Members that taking away the protected status of these people was not in the Conservative party manifesto. The opposite is the case: it talked about city hall fat cats. Many of us agreed that people should not be rewarded for failure, but the people we are talking about are doing dangerous work now. The measure is due to come in in October, and many private companies are refusing
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to put through redundancies now. They are holding them back until October so that the workers receive reduced conditions of service. That is wrong.
Chris Stephens: Surely the biggest safeguard of all is that an occupational pension scheme is deferred pay. The hon. Gentleman’s constituents could have made more money working for other companies, but they chose to stay where they were because they were going to get a good occupational pension scheme.
Albert Owen: That is absolutely right. The reality is that the Bill will take away the conditions of service that these people signed up to.
David Mowat: I am listening carefully to what the hon. Gentleman says and I have a lot of sympathy with it, but I do not follow one point he made regarding private companies versus public companies. If they really are private companies, how can the Bill apply to them? Am I missing something?
Albert Owen: It is very confusing. This has not been made clear, but my understanding is that if these people were to leave today, they would be given the full package, yet the companies have been told that the measure will apply from October and those very companies are now saying that people cannot go until then. That is what is being said by the hon. Gentleman’s constituents and my constituents who have been writing in.
The Minister could end the confusion today. She could say that she will honour, as Mrs Thatcher and other Tory Ministers did, the protected rights and status of these individuals, and we could have a vote. Lawyers will argue about whether people can be protected, but we should not leave it to the lawyers—the House of Commons has the opportunity to act today. I hope that Members across the House will support new schedule 1.
Anna Soubry: Government amendments 3 to 9 will enable Welsh Ministers to make regulations on exit payments that they feel are suitable and devolved to them through the Government of Wales Act 2006. That has been agreed with Welsh Ministers through the Welsh Assembly, and I am grateful for that.
The Conservative manifesto was very clear that we would introduce the cap and that we would set it at £95,000. It is extremely important to remember that this relates to redundancy pay. The cap will curb only the top end of exit payments—just the top 5% in value of all exit packages across the public sector. Amendment 15 is merely a device based on an article in TheDaily Telegraph written by my right hon. Friend the Member for Witham (Priti Patel) back in January 2015. It was not part of the manifesto promise that was made. There is no honour, if I may say, in putting that forward as anything other than a junior Treasury Minister praying it in aid in an article she wrote in TheDaily Telegraph.
I want to make it absolutely clear that the cap will not affect a classroom teacher earning the maximum of the upper pay range of £38,000 with a normal pension age of 60. It will not affect anyone working in the NHS earning below £47,500 or firefighters. I am told that police officers cannot be made redundant, and in any event no police officer earning below £54,000 would be caught by the cap. The Cabinet Office has confirmed
8 Mar 2016 : Column 185
that no civil servant earning below £25,000 will be captured. Some earning around £25,000 may be captured, but we can find no such example. A librarian earning £25,000 with 34 years’ experience could still retire on an unreduced pension at the age of 55.
3.30 pm
We also think it unlikely that anyone earning less than £27,000 would be hit by the cap. It is important that we remember that it is extremely rare in the private sector for anyone on a wage of £25,000 to expect, on redundancy, a payment of £95,000—nearly four times their annual earnings. Having said all that, my hon. Friend the Member for Bedford (Richard Fuller), who is no longer in his place, made one of the most important points: it is right that we look at the value of the cap, as opposed to the salary or income someone is earning when they leave.
Finally, I want to address the important points about new schedule 1 and ask hon. Members not to support it. I listened with great care to the excellent points made by my hon. Friend the Member for Aldershot (Sir Gerald Howarth)—I pay tribute to the workers he mentioned—and the hon. Member for Ynys Môn (Albert Owen). I must make it absolutely clear, however, that we oppose the new schedule because we think it wrong to put the exemptions in the Bill. The relaxation provisions allow for special circumstances but only after proper ministerial scrutiny. I can assure them that I will continue to speak to right hon. and hon. Friends in the Treasury.
I agree with the helpful and wise interventions from my right hon. Friend the Member for Cities of London and Westminster (Mark Field), and I hear the points hon. Members are making. I will continue to speak to them, but now is not—
Sir Gerald Howarth: Will the Minister give way?
Anna Soubry: No, forgive me, but the clock is against me.
Anna Soubry: No, there may be reasons. There is no need to interrupt.
Now is not the time to do what some hon. Members propose. There are other ways of doing it, if it is the right thing to do. It is right, however, that we be true to our clear manifesto commitment to set the cap at £95,000.
Kevin Brennan: On a point of order, Mr Deputy Speaker.
Mr Deputy Speaker (Mr Lindsay Hoyle): It is not a point of order. Come on.
Mr Deputy Speaker: Mr Brennan, I think it is for me to decide. I am sure it was going to be about time, and I am sure we are all aware of the time and what time the debate has to end.
8 Mar 2016 : Column 186
Anna Soubry: I was bobbing up and down like a 5 November apple, Mr Deputy Speaker. In any event, I do not know what all the fuss is about, because I am concluding my comments.
I believe that all points have been made, and based on everything I have said, I urge hon. Members to support the Government’s new clauses and to reject all the other amendments; they are not necessary.
Kevin Brennan: I respect your ruling, Mr Deputy Speaker, that my point of order, which I did not make, was out of order.
Mr Deputy Speaker: Order. It was going to be about time, but it is not for me to tell you how much time is left, as you know better than I do.
Kevin Brennan: Thank you, Mr Deputy Speaker. I simply note that the Minister was unwilling to give way because of time.
On the comments by the former Treasury Minister, now the Minister for Employment, the right hon. Member for Witham (Priti Patel), I thank the Minister today for confirming to the House that we cannot believe a word Ministers say. I thank her for putting that officially on the record.
Anna Soubry indicated dissent.
Kevin Brennan: Would the Minister like me to give way? I am happy to do so, if it is in order, Mr Deputy Speaker.
Mr Deputy Speaker: Minister, are you commenting from a sedentary position, or would you like to make a point of order?
Anna Soubry: The record will confirm that I did not say that a Minister’s word could not be trusted. I was talking about a comment in a newspaper that does not form part of Conservative party policy and was not in the manifesto. That is what matters the most.
Mr Deputy Speaker: The Minister has clarified her position.
Kevin Brennan: It was not in a newspaper that the policy was announced. As I said, we cannot believe a word Ministers say.
Let me say simply that, as in Committee, the Minister has confirmed nothing at all that will give any comfort to these workers. I am therefore going to ask my hon. Friends, and other hon. Members if they support these workers, to support us in the Division on new schedule 1.
Question put, That the schedule be read a Second time.
The House divided:
Ayes 266, Noes 291.
Division No. 207]
[
3.35 pm
AYES
Abbott, Ms Diane
Abrahams, Debbie
Ahmed-Sheikh, Ms Tasmina
Alexander, Heidi
Allen, Mr Graham
Anderson, Mr David
Ashworth, Jonathan
Austin, Ian
Bailey, Mr Adrian
Bardell, Hannah
Barron, rh Kevin
Beckett, rh Margaret
Benn, rh Hilary
Berger, Luciana
Betts, Mr Clive
Black, Mhairi
Blackford, Ian
Blackman, Kirsty
Blackman-Woods, Dr Roberta
Blenkinsop, Tom
Blomfield, Paul
Boswell, Philip
Bradshaw, rh Mr Ben
Brake, rh Tom
Brennan, Kevin
Brock, Deidre
Brown, Alan
Brown, Lyn
Brown, rh Mr Nicholas
Bryant, Chris
Burden, Richard
Burgon, Richard
Burnham, rh Andy
Butler, Dawn
Byrne, rh Liam
Cadbury, Ruth
Cameron, Dr Lisa
Campbell, rh Mr Alan
Campbell, Mr Gregory
Campbell, Mr Ronnie
Carmichael, rh Mr Alistair
Champion, Sarah
Chapman, Douglas
Chapman, Jenny
Cherry, Joanna
Clegg, rh Mr Nick
Coaker, Vernon
Coffey, Ann
Cooper, Julie
Cooper, Rosie
Cooper, rh Yvette
Corbyn, rh Jeremy
Cowan, Ronnie
Cox, Jo
Coyle, Neil
Crausby, Mr David
Crawley, Angela
Creagh, Mary
Cruddas, Jon
Cryer, John
Cummins, Judith
Cunningham, Alex
Cunningham, Mr Jim
Danczuk, Simon
David, Wayne
Day, Martyn
De Piero, Gloria
Debbonaire, Thangam
Docherty-Hughes, Martin
Donaldson, rh Mr Jeffrey M.
Donaldson, Stuart Blair
Doughty, Stephen
Dowd, Jim
Dowd, Peter
Dromey, Jack
Dugher, Michael
Durkan, Mark
Eagle, Ms Angela
Eagle, Maria
Edwards, Jonathan
Efford, Clive
Elliott, Julie
Ellman, Mrs Louise
Esterson, Bill
Evans, Chris
Farrelly, Paul
Fellows, Marion
Ferrier, Margaret
Field, rh Frank
Fitzpatrick, Jim
Fletcher, Colleen
Flint, rh Caroline
Flynn, Paul
Fovargue, Yvonne
Gardiner, Barry
Glass, Pat
Glindon, Mary
Godsiff, Mr Roger
Goodman, Helen
Grady, Patrick
Grant, Peter
Gray, Neil
Green, Kate
Greenwood, Lilian
Greenwood, Margaret
Griffith, Nia
Gwynne, Andrew
Haigh, Louise
Hamilton, Fabian
Harman, rh Ms Harriet
Harris, Carolyn
Hayes, Helen
Hayman, Sue
Healey, rh John
Hendrick, Mr Mark
Hendry, Drew
Hillier, Meg
Hodge, rh Dame Margaret
Hodgson, Mrs Sharon
Hollern, Kate
Hopkins, Kelvin
Hosie, Stewart
Howarth, rh Mr George
Hunt, Tristram
Irranca-Davies, Huw
Jarvis, Dan
Johnson, rh Alan
Jones, Gerald
Jones, Graham
Jones, Helen
Jones, Mr Kevan
Jones, Susan Elan
Kane, Mike
Kaufman, rh Sir Gerald
Keeley, Barbara
Kendall, Liz
Kerevan, George
Kerr, Calum
Kinnock, Stephen
Kyle, Peter
Lamb, rh Norman
Lavery, Ian
Law, Chris
Leslie, Chris
Lewell-Buck, Mrs Emma
Lewis, Clive
Lewis, Mr Ivan
Long Bailey, Rebecca
Lucas, Caroline
Lucas, Ian C.
Lynch, Holly
MacNeil, Mr Angus Brendan
Mactaggart, rh Fiona
Madders, Justin
Mahmood, Mr Khalid
Mahmood, Shabana
Malhotra, Seema
Mann, John
Marris, Rob
Marsden, Mr Gordon
Maskell, Rachael
Matheson, Christian
Mc Nally, John
McCabe, Steve
McCaig, Callum
McCarthy, Kerry
McDonagh, Siobhain
McDonald, Andy
McDonald, Stuart C.
McDonnell, John
McFadden, rh Mr Pat
McGinn, Conor
McGovern, Alison
McInnes, Liz
McKinnell, Catherine
McLaughlin, Anne
McMahon, Jim
Meale, Sir Alan
Mearns, Ian
Miliband, rh Edward
Monaghan, Carol
Monaghan, Dr Paul
Moon, Mrs Madeleine
Morden, Jessica
Morris, Grahame M.
Mulholland, Greg
Mullin, Roger
Nandy, Lisa
Newlands, Gavin
O'Hara, Brendan
Onn, Melanie
Onwurah, Chi
Osamor, Kate
Oswald, Kirsten
Owen, Albert
Paterson, Steven
Pearce, Teresa
Pennycook, Matthew
Perkins, Toby
Phillips, Jess
Pound, Stephen
Powell, Lucy
Pugh, John
Rayner, Angela
Reed, Mr Jamie
Reed, Mr Steve
Rees, Christina
Reynolds, Emma
Reynolds, Jonathan
Ritchie, Ms Margaret
Robertson, rh Angus
Robinson, Mr Geoffrey
Rotheram, Steve
Ryan, rh Joan
Saville Roberts, Liz
Shah, Naz
Shannon, Jim
Sharma, Mr Virendra
Sheerman, Mr Barry
Sheppard, Tommy
Sherriff, Paula
Shuker, Mr Gavin
Siddiq, Tulip
Skinner, Mr Dennis
Slaughter, Andy
Smeeth, Ruth
Smith, rh Mr Andrew
Smith, Angela
Smith, Nick
Smith, Owen
Smyth, Karin
Spellar, rh Mr John
Starmer, Keir
Stephens, Chris
Stevens, Jo
Streeting, Wes
Stringer, Graham
Stuart, rh Ms Gisela
Tami, Mark
Thewliss, Alison
Thomas, Mr Gareth
Thompson, Owen
Thomson, Michelle
Thornberry, Emily
Timms, rh Stephen
Trickett, Jon
Turley, Anna
Twigg, Derek
Twigg, Stephen
Umunna, Mr Chuka
Vaz, rh Keith
Vaz, Valerie
Watson, Mr Tom
Weir, Mike
West, Catherine
Whiteford, Dr Eilidh
Whitehead, Dr Alan
Whitford, Dr Philippa
Williams, Hywel
Williams, Mr Mark
Wilson, Corri
Winnick, Mr David
Winterton, rh Dame Rosie
Wishart, Pete
Wright, Mr Iain
Zeichner, Daniel
Tellers for the Ayes:
Vicky Foxcroft
and
Jeff Smith
NOES
Adams, Nigel
Afriyie, Adam
Aldous, Peter
Allan, Lucy
Allen, Heidi
Andrew, Stuart
Ansell, Caroline
Argar, Edward
Atkins, Victoria
Bacon, Mr Richard
Baker, Mr Steve
Baldwin, Harriett
Barclay, Stephen
Baron, Mr John
Bebb, Guto
Bellingham, Sir Henry
Benyon, Richard
Beresford, Sir Paul
Berry, Jake
Berry, James
Bingham, Andrew
Blackman, Bob
Boles, Nick
Bone, Mr Peter
Borwick, Victoria
Bottomley, Sir Peter
Bradley, Karen
Brady, Mr Graham
Brazier, Mr Julian
Bridgen, Andrew
Brine, Steve
Brokenshire, rh James
Bruce, Fiona
Buckland, Robert
Burns, Conor
Burns, rh Sir Simon
Burrowes, Mr David
Burt, rh Alistair
Cairns, Alun
Carmichael, Neil
Cartlidge, James
Cash, Sir William
Caulfield, Maria
Chalk, Alex
Chishti, Rehman
Chope, Mr Christopher
Churchill, Jo
Clark, rh Greg
Cleverly, James
Coffey, Dr Thérèse
Collins, Damian
Colvile, Oliver
Costa, Alberto
Cox, Mr Geoffrey
Crabb, rh Stephen
Davies, Byron
Davies, Chris
Davies, David T. C.
Davies, Glyn
Davies, Dr James
Davies, Mims
Davis, rh Mr David
Dinenage, Caroline
Djanogly, Mr Jonathan
Donelan, Michelle
Dorries, Nadine
Double, Steve
Dowden, Oliver
Doyle-Price, Jackie
Drax, Richard
Drummond, Mrs Flick
Duncan, rh Sir Alan
Duncan Smith, rh Mr Iain
Dunne, Mr Philip
Ellis, Michael
Ellison, Jane
Ellwood, Mr Tobias
Elphicke, Charlie
Eustice, George
Evans, Graham
Evennett, rh Mr David
Fabricant, Michael
Fallon, rh Michael
Fernandes, Suella
Field, rh Mark
Foster, Kevin
Fox, rh Dr Liam
Francois, rh Mr Mark
Frazer, Lucy
Freeman, George
Freer, Mike
Fuller, Richard
Fysh, Marcus
Garnier, rh Sir Edward
Gauke, Mr David
Ghani, Nusrat
Gibb, Mr Nick
Gillan, rh Mrs Cheryl
Glen, John
Goodwill, Mr Robert
Gove, rh Michael
Graham, Richard
Grant, Mrs Helen
Gray, Mr James
Grayling, rh Chris
Green, Chris
Green, rh Damian
Greening, rh Justine
Griffiths, Andrew
Gummer, Ben
Gyimah, Mr Sam
Halfon, rh Robert
Hall, Luke
Hammond, Stephen
Hancock, rh Matthew
Hands, rh Greg
Harper, rh Mr Mark
Harrington, Richard
Harris, Rebecca
Hart, Simon
Haselhurst, rh Sir Alan
Hayes, rh Mr John
Heald, Sir Oliver
Heappey, James
Heaton-Harris, Chris
Heaton-Jones, Peter
Henderson, Gordon
Herbert, rh Nick
Hinds, Damian
Hoare, Simon
Hollingbery, George
Hollinrake, Kevin
Hollobone, Mr Philip
Hopkins, Kris
Howarth, Sir Gerald
Howlett, Ben
Huddleston, Nigel
Hunt, rh Mr Jeremy
Jackson, Mr Stewart
James, Margot
Javid, rh Sajid
Jayawardena, Mr Ranil
Jenkin, Mr Bernard
Jenkyns, Andrea
Jenrick, Robert
Johnson, Boris
Johnson, Gareth
Johnson, Joseph
Jones, Andrew
Jones, rh Mr David
Jones, Mr Marcus
Kennedy, Seema
Kinahan, Danny
Kirby, Simon
Knight, rh Sir Greg
Knight, Julian
Kwarteng, Kwasi
Lancaster, Mark
Latham, Pauline
Leadsom, Andrea
Lee, Dr Phillip
Lefroy, Jeremy
Leigh, Sir Edward
Letwin, rh Mr Oliver
Lewis, Brandon
Lewis, rh Dr Julian
Lidington, rh Mr David
Lilley, rh Mr Peter
Lord, Jonathan
Loughton, Tim
Lumley, Karen
Mackinlay, Craig
Mackintosh, David
Main, Mrs Anne
Mak, Mr Alan
Malthouse, Kit
Mann, Scott
Mathias, Dr Tania
May, rh Mrs Theresa
Maynard, Paul
McCartney, Jason
McCartney, Karl
McLoughlin, rh Mr Patrick
McPartland, Stephen
Mercer, Johnny
Merriman, Huw
Metcalfe, Stephen
Miller, rh Mrs Maria
Milling, Amanda
Milton, rh Anne
Mitchell, rh Mr Andrew
Mordaunt, Penny
Morris, Anne Marie
Morris, David
Morris, James
Morton, Wendy
Mowat, David
Mundell, rh David
Murray, Mrs Sheryll
Murrison, Dr Andrew
Nokes, Caroline
Norman, Jesse
Nuttall, Mr David
Offord, Dr Matthew
Opperman, Guy
Parish, Neil
Patel, rh Priti
Paterson, rh Mr Owen
Pawsey, Mark
Penrose, John
Percy, Andrew
Phillips, Stephen
Philp, Chris
Pickles, rh Sir Eric
Pincher, Christopher
Poulter, Dr Daniel
Pow, Rebecca
Prisk, Mr Mark
Pritchard, Mark
Pursglove, Tom
Quin, Jeremy
Quince, Will
Raab, Mr Dominic
Redwood, rh John
Rees-Mogg, Mr Jacob
Robinson, Mary
Rosindell, Andrew
Rudd, rh Amber
Rutley, David
Sandbach, Antoinette
Scully, Paul
Selous, Andrew
Shapps, rh Grant
Sharma, Alok
Shelbrooke, Alec
Simpson, rh Mr Keith
Skidmore, Chris
Smith, Chloe
Smith, Henry
Smith, Julian
Smith, Royston
Soames, rh Sir Nicholas
Solloway, Amanda
Soubry, rh Anna
Spelman, rh Mrs Caroline
Spencer, Mark
Stephenson, Andrew
Stevenson, John
Stewart, Bob
Stewart, Iain
Stewart, Rory
Streeter, Mr Gary
Sturdy, Julian
Sunak, Rishi
Swayne, rh Mr Desmond
Swire, rh Mr Hugo
Syms, Mr Robert
Thomas, Derek
Throup, Maggie
Tolhurst, Kelly
Tomlinson, Justin
Tomlinson, Michael
Tracey, Craig
Tredinnick, David
Trevelyan, Mrs Anne-Marie
Truss, rh Elizabeth
Tugendhat, Tom
Turner, Mr Andrew
Tyrie, rh Mr Andrew
Vaizey, Mr Edward
Vara, Mr Shailesh
Vickers, Martin
Villiers, rh Mrs Theresa
Walker, Mr Charles
Walker, Mr Robin
Wallace, Mr Ben
Warburton, David
Warman, Matt
Watkinson, Dame Angela
Wharton, James
Whately, Helen
White, Chris
Whittingdale, rh Mr John
Wiggin, Bill
Williams, Craig
Williamson, rh Gavin
Wilson, Mr Rob
Wollaston, Dr Sarah
Wood, Mike
Wragg, William
Wright, rh Jeremy
Tellers for the Noes:
Sarah Newton
and
Mel Stride
Question accordingly negatived.
8 Mar 2016 : Column 187
8 Mar 2016 : Column 188
8 Mar 2016 : Column 189
8 Mar 2016 : Column 190
8 Mar 2016 : Column 191
3.49 pm
More than three hours having elapsed since the commencement of proceedings on the programme motion, the proceedings were interrupted (Programme Order, this day).
The Deputy Speaker put forthwith the Questions necessary for the disposal of the business to be concluded at that time (Standing Order No. 83E).
Restriction on public sector exit payments
Amendment proposed: 18, page 56, line 18, at end insert—
‘(1A) The restriction placed on public sector exit payments must be reviewed at regular intervals and, where necessary, be adjusted in line with inflation and earnings growth.’.—(Alan Brown.)
This amendment would ensure that the level that the restriction on public sector exit payments is set will be linked to inflation and earnings growth.
Question put, That the amendment be made.
The House divided:
Ayes 268, Noes 293.
Division No. 208]
[
3.49 pm
AYES
Abbott, Ms Diane
Abrahams, Debbie
Ahmed-Sheikh, Ms Tasmina
Alexander, Heidi
Allen, Mr Graham
Anderson, Mr David
Ashworth, Jonathan
Austin, Ian
Bailey, Mr Adrian
Bardell, Hannah
Barron, rh Kevin
Beckett, rh Margaret
Benn, rh Hilary
Berger, Luciana
Betts, Mr Clive
Black, Mhairi
Blackford, Ian
Blackman, Kirsty
Blackman-Woods, Dr Roberta
Blenkinsop, Tom
Blomfield, Paul
Boswell, Philip
Bradshaw, rh Mr Ben
Brake, rh Tom
Brennan, Kevin
Brock, Deidre
Brown, Alan
Brown, Lyn
Brown, rh Mr Nicholas
Bryant, Chris
Burden, Richard
Burgon, Richard
Burnham, rh Andy
Butler, Dawn
Byrne, rh Liam
Cadbury, Ruth
Cameron, Dr Lisa
Campbell, rh Mr Alan
Campbell, Mr Gregory
Campbell, Mr Ronnie
Carmichael, rh Mr Alistair
Champion, Sarah
Chapman, Douglas
Chapman, Jenny
Cherry, Joanna
Clegg, rh Mr Nick
Coaker, Vernon
Coffey, Ann
Cooper, Julie
Cooper, Rosie
Cooper, rh Yvette
Corbyn, rh Jeremy
Cowan, Ronnie
Cox, Jo
Coyle, Neil
Crausby, Mr David
Crawley, Angela
Creagh, Mary
Cruddas, Jon
Cryer, John
Cummins, Judith
Cunningham, Alex
Cunningham, Mr Jim
Danczuk, Simon
David, Wayne
Day, Martyn
De Piero, Gloria
Debbonaire, Thangam
Docherty-Hughes, Martin
Donaldson, rh Mr Jeffrey M.
Donaldson, Stuart Blair
Doughty, Stephen
Dowd, Jim
Dowd, Peter
Dromey, Jack
Dugher, Michael
Durkan, Mark
Eagle, Ms Angela
Eagle, Maria
Edwards, Jonathan
Efford, Clive
Elliott, Julie
Ellman, Mrs Louise
Esterson, Bill
Evans, Chris
Farrelly, Paul
Ferrier, Margaret
Field, rh Frank
Fitzpatrick, Jim
Fletcher, Colleen
Flint, rh Caroline
Flynn, Paul
Fovargue, Yvonne
Foxcroft, Vicky
Gardiner, Barry
Glass, Pat
Glindon, Mary
Godsiff, Mr Roger
Goodman, Helen
Grady, Patrick
Grant, Peter
Gray, Neil
Green, Kate
Greenwood, Lilian
Greenwood, Margaret
Griffith, Nia
Gwynne, Andrew
Haigh, Louise
Hamilton, Fabian
Harman, rh Ms Harriet
Harris, Carolyn
Hayes, Helen
Hayman, Sue
Healey, rh John
Hendrick, Mr Mark
Hendry, Drew
Hillier, Meg
Hodge, rh Dame Margaret
Hodgson, Mrs Sharon
Hollern, Kate
Hopkins, Kelvin
Hosie, Stewart
Howarth, rh Mr George
Hunt, Tristram
Irranca-Davies, Huw
Jarvis, Dan
Johnson, rh Alan
Jones, Gerald
Jones, Graham
Jones, Helen
Jones, Mr Kevan
Jones, Susan Elan
Kane, Mike
Kaufman, rh Sir Gerald
Keeley, Barbara
Kendall, Liz
Kerevan, George
Kerr, Calum
Kinahan, Danny
Kinnock, Stephen
Kyle, Peter
Lamb, rh Norman
Lavery, Ian
Law, Chris
Leslie, Chris
Lewell-Buck, Mrs Emma
Lewis, Clive
Lewis, Mr Ivan
Long Bailey, Rebecca
Lucas, Caroline
Lucas, Ian C.
Lynch, Holly
MacNeil, Mr Angus Brendan
Mactaggart, rh Fiona
Madders, Justin
Mahmood, Mr Khalid
Mahmood, Shabana
Malhotra, Seema
Mann, John
Marris, Rob
Marsden, Mr Gordon
Maskell, Rachael
Matheson, Christian
Mc Nally, John
McCabe, Steve
McCaig, Callum
McCarthy, Kerry
McDonagh, Siobhain
McDonald, Andy
McDonald, Stuart C.
McDonnell, John
McFadden, rh Mr Pat
McGinn, Conor
McGovern, Alison
McInnes, Liz
McKinnell, Catherine
McLaughlin, Anne
McMahon, Jim
Meale, Sir Alan
Mearns, Ian
Miliband, rh Edward
Monaghan, Carol
Monaghan, Dr Paul
Moon, Mrs Madeleine
Morden, Jessica
Morris, Grahame M.
Mulholland, Greg
Mullin, Roger
Nandy, Lisa
Newlands, Gavin
O'Hara, Brendan
Onn, Melanie
Onwurah, Chi
Osamor, Kate
Oswald, Kirsten
Owen, Albert
Paterson, Steven
Pearce, Teresa
Pennycook, Matthew
Perkins, Toby
Phillips, Jess
Pound, Stephen
Powell, Lucy
Pugh, John
Rayner, Angela
Reed, Mr Jamie
Reed, Mr Steve
Rees, Christina
Reynolds, Emma
Reynolds, Jonathan
Ritchie, Ms Margaret
Robertson, rh Angus
Robinson, Mr Geoffrey
Rotheram, Steve
Ryan, rh Joan
Saville Roberts, Liz
Shah, Naz
Shannon, Jim
Sharma, Mr Virendra
Sheerman, Mr Barry
Sheppard, Tommy
Sherriff, Paula
Shuker, Mr Gavin
Siddiq, Tulip
Skinner, Mr Dennis
Slaughter, Andy
Smeeth, Ruth
Smith, rh Mr Andrew
Smith, Angela
Smith, Jeff
Smith, Nick
Smith, Owen
Smyth, Karin
Spellar, rh Mr John
Starmer, Keir
Stephens, Chris
Stevens, Jo
Streeting, Wes
Stringer, Graham
Stuart, rh Ms Gisela
Tami, Mark
Thewliss, Alison
Thomas, Mr Gareth
Thomson, Michelle
Thornberry, Emily
Timms, rh Stephen
Trickett, Jon
Turley, Anna
Twigg, Derek
Twigg, Stephen
Umunna, Mr Chuka
Vaz, rh Keith
Vaz, Valerie
Watson, Mr Tom
Weir, Mike
West, Catherine
Whiteford, Dr Eilidh
Whitehead, Dr Alan
Whitford, Dr Philippa
Williams, Hywel
Williams, Mr Mark
Wilson, Corri
Winnick, Mr David
Winterton, rh Dame Rosie
Wishart, Pete
Woodcock, John
Wright, Mr Iain
Zeichner, Daniel
Tellers for the Ayes:
Owen Thompson
and
Marion Fellows
NOES
Adams, Nigel
Afriyie, Adam
Aldous, Peter
Allan, Lucy
Allen, Heidi
Andrew, Stuart
Ansell, Caroline
Argar, Edward
Atkins, Victoria
Bacon, Mr Richard
Baker, Mr Steve
Baldwin, Harriett
Barclay, Stephen
Baron, Mr John
Bebb, Guto
Bellingham, Sir Henry
Benyon, Richard
Beresford, Sir Paul
Berry, Jake
Berry, James
Bingham, Andrew
Blackman, Bob
Boles, Nick
Bone, Mr Peter
Borwick, Victoria
Bottomley, Sir Peter
Bradley, Karen
Brady, Mr Graham
Brazier, Mr Julian
Bridgen, Andrew
Brine, Steve
Brokenshire, rh James
Bruce, Fiona
Buckland, Robert
Burns, Conor
Burns, rh Sir Simon
Burrowes, Mr David
Burt, rh Alistair
Cairns, Alun
Carmichael, Neil
Cartlidge, James
Cash, Sir William
Caulfield, Maria
Chalk, Alex
Chishti, Rehman
Chope, Mr Christopher
Churchill, Jo
Clark, rh Greg
Cleverly, James
Coffey, Dr Thérèse
Collins, Damian
Colvile, Oliver
Costa, Alberto
Cox, Mr Geoffrey
Crabb, rh Stephen
Davies, Byron
Davies, Chris
Davies, David T. C.
Davies, Glyn
Davies, Dr James
Davies, Mims
Davis, rh Mr David
Dinenage, Caroline
Djanogly, Mr Jonathan
Donelan, Michelle
Dorries, Nadine
Double, Steve
Dowden, Oliver
Doyle-Price, Jackie
Drax, Richard
Drummond, Mrs Flick
Duncan, rh Sir Alan
Duncan Smith, rh Mr Iain
Dunne, Mr Philip
Ellis, Michael
Ellison, Jane
Ellwood, Mr Tobias
Elphicke, Charlie
Eustice, George
Evans, Graham
Evennett, rh Mr David
Fabricant, Michael
Fallon, rh Michael
Fernandes, Suella
Field, rh Mark
Foster, Kevin
Fox, rh Dr Liam
Francois, rh Mr Mark
Frazer, Lucy
Freeman, George
Freer, Mike
Fuller, Richard
Fysh, Marcus
Garnier, rh Sir Edward
Garnier, Mark
Gauke, Mr David
Ghani, Nusrat
Gibb, Mr Nick
Gillan, rh Mrs Cheryl
Glen, John
Goodwill, Mr Robert
Gove, rh Michael
Graham, Richard
Grant, Mrs Helen
Gray, Mr James
Grayling, rh Chris
Green, Chris
Green, rh Damian
Greening, rh Justine
Grieve, rh Mr Dominic
Griffiths, Andrew
Gummer, Ben
Gyimah, Mr Sam
Halfon, rh Robert
Hall, Luke
Hammond, Stephen
Hancock, rh Matthew
Hands, rh Greg
Harper, rh Mr Mark
Harrington, Richard
Harris, Rebecca
Hart, Simon
Haselhurst, rh Sir Alan
Hayes, rh Mr John
Heald, Sir Oliver
Heappey, James
Heaton-Harris, Chris
Heaton-Jones, Peter
Henderson, Gordon
Herbert, rh Nick
Hinds, Damian
Hoare, Simon
Hollingbery, George
Hollinrake, Kevin
Hollobone, Mr Philip
Hopkins, Kris
Howarth, Sir Gerald
Howlett, Ben
Huddleston, Nigel
Hunt, rh Mr Jeremy
Hurd, Mr Nick
Jackson, Mr Stewart
James, Margot
Javid, rh Sajid
Jayawardena, Mr Ranil
Jenkin, Mr Bernard
Jenkyns, Andrea
Jenrick, Robert
Johnson, Boris
Johnson, Gareth
Johnson, Joseph
Jones, Andrew
Jones, rh Mr David
Jones, Mr Marcus
Kennedy, Seema
Knight, rh Sir Greg
Knight, Julian
Kwarteng, Kwasi
Lancaster, Mark
Latham, Pauline
Leadsom, Andrea
Lee, Dr Phillip
Lefroy, Jeremy
Leigh, Sir Edward
Letwin, rh Mr Oliver
Lewis, Brandon
Lewis, rh Dr Julian
Lidington, rh Mr David
Lilley, rh Mr Peter
Lord, Jonathan
Loughton, Tim
Lumley, Karen
Mackinlay, Craig
Mackintosh, David
Main, Mrs Anne
Mak, Mr Alan
Malthouse, Kit
Mann, Scott
Mathias, Dr Tania
May, rh Mrs Theresa
Maynard, Paul
McCartney, Jason
McCartney, Karl
McLoughlin, rh Mr Patrick
McPartland, Stephen
Mercer, Johnny
Merriman, Huw
Metcalfe, Stephen
Miller, rh Mrs Maria
Milling, Amanda
Milton, rh Anne
Mitchell, rh Mr Andrew
Mordaunt, Penny
Morris, Anne Marie
Morris, David
Morris, James
Morton, Wendy
Mowat, David
Mundell, rh David
Murray, Mrs Sheryll
Murrison, Dr Andrew
Nokes, Caroline
Norman, Jesse
Nuttall, Mr David
Offord, Dr Matthew
Opperman, Guy
Parish, Neil
Patel, rh Priti
Paterson, rh Mr Owen
Pawsey, Mark
Penrose, John
Percy, Andrew
Phillips, Stephen
Philp, Chris
Pickles, rh Sir Eric
Pincher, Christopher
Poulter, Dr Daniel
Pow, Rebecca
Prisk, Mr Mark
Pritchard, Mark
Pursglove, Tom
Quin, Jeremy
Quince, Will
Raab, Mr Dominic
Redwood, rh John
Rees-Mogg, Mr Jacob
Robinson, Mary
Rosindell, Andrew
Rudd, rh Amber
Rutley, David
Sandbach, Antoinette
Scully, Paul
Selous, Andrew
Shapps, rh Grant
Sharma, Alok
Shelbrooke, Alec
Simpson, rh Mr Keith
Skidmore, Chris
Smith, Chloe
Smith, Henry
Smith, Julian
Smith, Royston
Soames, rh Sir Nicholas
Solloway, Amanda
Soubry, rh Anna
Spelman, rh Mrs Caroline
Spencer, Mark
Stephenson, Andrew
Stevenson, John
Stewart, Bob
Stewart, Iain
Stewart, Rory
Streeter, Mr Gary
Stride, Mel
Sturdy, Julian
Sunak, Rishi
Swayne, rh Mr Desmond
Swire, rh Mr Hugo
Syms, Mr Robert
Thomas, Derek
Throup, Maggie
Tolhurst, Kelly
Tomlinson, Justin
Tomlinson, Michael
Tracey, Craig
Tredinnick, David
Trevelyan, Mrs Anne-Marie
Truss, rh Elizabeth
Tugendhat, Tom
Turner, Mr Andrew
Tyrie, rh Mr Andrew
Vaizey, Mr Edward
Vara, Mr Shailesh
Vickers, Martin
Villiers, rh Mrs Theresa
Walker, Mr Charles
Walker, Mr Robin
Wallace, Mr Ben
Warburton, David
Warman, Matt
Watkinson, Dame Angela
Wharton, James
Whately, Helen
White, Chris
Whittingdale, rh Mr John
Wiggin, Bill
Williams, Craig
Williamson, rh Gavin
Wilson, Mr Rob
Wollaston, Dr Sarah
Wood, Mike
Wragg, William
Wright, rh Jeremy
Tellers for the Noes:
Simon Kirby
and
Sarah Newton
Question accordingly negatived.
8 Mar 2016 : Column 192
8 Mar 2016 : Column 193
8 Mar 2016 : Column 194
8 Mar 2016 : Column 195
Amendments made: 3, page 58, line 7, at end insert—
“() by the Welsh Ministers, in relation to relevant Welsh exit payments;”
This amendment confers power on the Welsh Ministers (instead of the Treasury) to make regulations under new section 153A of the Small Business, Enterprise and Employment Act 2015 restricting the total amount of exit payments made to the holder of an office in Wales mentioned in amendment 5.
Amendment 4, page 58, line 27, at end insert—
“() if made by the Welsh Ministers, may not be made unless a draft of the statutory instrument containing them has been laid before, and approved by a resolution of, the National Assembly for Wales.”
This amendment provides for the procedure in the National Assembly for Wales in relation to regulations under new section 153A made by the Welsh Ministers (see explanatory statement for amendment 3).
Amendment 5, page 58, line 32, at end insert—
“( ) In this section “relevant Welsh exit payments” means exit payments made to holders of the following offices—
(a) member of the National Assembly for Wales;
(b) the First Minister for Wales;
(c) Welsh Minister appointed under section 48 of the Government of Wales Act 2006;
(d) Counsel General to the Welsh Government;
(f) member of a county council or a county borough council in Wales;
(g) member of a National Park Authority in Wales;
(h) member of a Fire and Rescue Authority in Wales.”
This amendment specifies the offices in Wales in relation to which the Welsh Ministers can make regulations under new section 153A (see explanatory statement for amendment 3).
8 Mar 2016 : Column 196
Amendment 6, page 58, line 37, at end insert—
“(2A) The Welsh Ministers may relax any restriction imposed by regulations made by the Welsh Ministers under section 153A.”
This amendment ensures that the Welsh Ministers have power to relax restrictions imposed by them under new section 153A (see explanatory statement for amendment 3).
Amendment 7, page 59, line 1, at beginning insert—
“except in relation to exit payments made by a relevant Welsh authority,”
This amendment ensures that the Treasury are not able to impose limitations on the power of the Welsh Ministers to relax certain restrictions imposed by Treasury regulations (see explanatory statement for amendment 8).
Amendment 8, page 59, leave out lines 18 to 24 and insert—
“(6) Regulations under section 153A made by the Welsh Ministers may—
(a) make provision for the power under subsection (2A) to be exercisable on behalf of the Welsh Ministers by a person specified in the regulations;
(b) where provision is made by virtue of paragraph (a), make provision for a requirement to be relaxed only—
(i) with the consent of the Welsh Ministers, or
(ii) following compliance with any directions given by the Welsh Ministers;
(c) make provision as to the publication of information about any relaxation of a requirement granted.
(6A) Regulations made by the Treasury under section 153A(1)—
(a) must, if they make provision in relation to exit payments made by a relevant Welsh authority, provide for the power conferred on a Minister of the Crown by subsection (1) to be exercised instead by the Welsh Ministers in relation to those exit payments;
(b) may provide for the power conferred on a Minister of the Crown by subsection (1) to be exercised instead by the Welsh Ministers in relation to exit payments made by any other authority who is not a relevant Welsh authority but who wholly or mainly exercises functions in relation to Wales (but this does not limit the provision that may be made under subsection (4)(a)).”
This amendment allows the Welsh Ministers to provide for another person to relax on their behalf restrictions imposed by them under new section 153A (see explanatory statement for amendment 6). It also requires the Treasury to provide for the Welsh Ministers to be able to relax certain restrictions imposed by Treasury regulations, and gives the Treasury power so to provide in relation to other such restrictions.
Amendment 9, page 59, line 26, at end insert—
“relevant Welsh authority” means an authority who wholly or mainly exercises functions which could be conferred by provision falling within the legislative competence of the National Assembly for Wales (as defined in section 108 of the Government of Wales Act 2006).”—(Anna Soubry.)
This amendment defines “relevant Welsh authority” for the purposes of the provisions inserted by amendments 7 and
8
.
Ordered, That further consideration be now adjourned. —(Julian Smith.)
Bill to be further considered tomorrow.