Mike Wood MP: speeches

Speeches

• 27 Feb 2025 · Public Authorities (Fraud, Error and Recovery) Bill (Third sitting) · Hansard source

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  I beg to move amendment 15, in clause 4, page 3, line 33, leave out “Minister” and insert “First Tier Tribunal”.

• 27 Feb 2025 · Public Authorities (Fraud, Error and Recovery) Bill (Third sitting) · Hansard source

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  As I stated, those are largely probing amendments in areas that we would like to see the Government work on during the passage of the Bill. However, for now, we do not intend to push them to a vote. Clause 3 ordered to stand part of the Bill. Clause 4 Reviews

• 27 Feb 2025 · Public Authorities (Fraud, Error and Recovery) Bill (Third sitting) · Hansard source

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  Clause 4 gives the Minister a considerable amount of power to compel individuals, as well as organisations, to provide an unspecified range of information within what could be very tight timescales, on pain of a fine of £300 a day if they fail to comply. The only route to appeal these powers is going back to the person or organisation that is exercising them, and we are concerned about the natural justice of this approach. The legislation, as drafted, involves no impartial third party in the review process on a case-by-case basis, so it leaves individuals with nowhere else to go if they disagree with what is being asked for, or cannot practically comply with the request in the specified timeframe. Our amendments aim to balance these powers, and I am naturally disappointed that the Minister was unable to consider accepting at least some of them.

• 27 Feb 2025 · Public Authorities (Fraud, Error and Recovery) Bill (Third sitting) · Hansard source

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  I thank the Minister for her response, which offered some moderate reassurance. We would be comfortable if either it was included in the Bill or we at least had sight of the code of practice, which will actually define that decision-making process. A fundamental flaw of this Bill Committee is that we are being asked to make decisions on something that may be produced in the future, of which we have no advanced sight. For now, I beg to ask leave to withdraw the amendment. Amendment, by leave, withdrawn. Question proposed , That the clause stand part of the Bill.

• 27 Feb 2025 · Public Authorities (Fraud, Error and Recovery) Bill (Third sitting) · Hansard source

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  I beg to move amendment 11, in clause 3, page 2, line 36, at end insert— “(c) the information is likely to relate to the suspected fraud, and (d) the cost involved in recovering the required information is likely to be reasonable and proportionate.”

• 27 Feb 2025 · Public Authorities (Fraud, Error and Recovery) Bill (Third sitting) · Hansard source

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  I thank the Minister for those responses, but I think that the first-tier tribunal is perfectly capable of dismissing applications that are without merit, without significantly extending the time. Given the importance of an independent appeal mechanism, I wish to push the amendment to a vote. Question put, That the amendment be made.

• 27 Feb 2025 · Public Authorities (Fraud, Error and Recovery) Bill (Third sitting) · Hansard source

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  I beg to move amendment 12, in clause 4, page 3, line 33, at end insert— “or of the duration of the period mentioned in section 3(4)(a)”.

• 27 Feb 2025 · Public Authorities (Fraud, Error and Recovery) Bill (Third sitting) · Hansard source

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  Clause 3 would give the PSFA the power to issue information notices to a third party, compelling them to provide information within a deadline. The amendments set out the circumstances in which that would be done and set what we think is a perfectly reasonable test of reasonableness, as well as exploring the time provided for the recipients of notices to respond. Our amendments are designed to probe some areas of this process. The powers given to the Minister for the Cabinet Office in clause 3 are wide-ranging, so we wish to ensure that these are used reasonably and proportionately, and solely in connection with the explicit purpose of the Bill. We have tabled amendments 11, 10, 14, and 9 to that end. We have to remember that the powers can be used against individuals and small businesses. While we might expect most of the notices to be issued against multinational companies, particularly financial institutions, we also need to consider those who do not have the capacity of larger organisations. The powers must be used reasonably and effectively in all circumstances. Amendment 11 sets a reasonableness test relating to whether the information being requested is likely to relate to the fraud in question—for example, in private text messages—and therefore whether it is reasonable to ask for that information, and whether the cost involved in recovering the required information is likely to be reasonable and proportionate. The Minister referred to equivalent powers that are available in other forms of investigation that the Government and their agencies and bodies carry out. We see the reasonableness test as equivalent to that which HMRC must meet in its notices. We also wish to ensure that the powers are not misused, and amendments 9 and 10 are directed towards that purpose. Although clause 3 states that the Minister can use the powers only against someone “whom the Minister has reasonable grounds to suspect has committed fraud against a public authority” the Bill provides no definition of “reasonable”, so amendments 9 and 10 are designed to fill some of that gap. Amendment 10 specifies that the Minister for the Cabinet Office “has reasonable grounds to suspect a person has committed fraud against a public authority if…there is an objective basis for the Minister’s suspicion based on facts, verifiable information or intelligence, and…a reasonable person would be entitled to reach same conclusion based on the same facts, information or intelligence.” We want to be clear about what we do not think are reasonable grounds. These would include, for example, if the Minister’s suspicions were based in any way on a person’s physical appearance—protected characteristics under the Equality Act 2010 that the person may have, or appear to the Minister to have—or were based solely on any generalisation or stereotype giving rise to a belief that certain groups or categories of people are more likely to be involved in criminal activity. We want to ensure that the powers are exercised responsibly and appropriately. Amendment 9 gives the definition of “reasonable” as meaning that “the Minister must have formed a genuine suspicion in their own mind, and the suspicion that fraudulent activity has taken place must be reasonable. This means that there must be an objective basis for that suspicion based on facts, verifiable information and or intelligence which indicate that fraudulent activity will be found, so that a reasonable person would be entitled to reach the same conclusion based on the same facts and information, and or intelligence.” Amendments 9 and 10 are based on the reasonable grounds for suspicion that are contained in the PACE—the Police and Criminal Evidence Act 1984—code A. Bearing in mind that these powers will be exercised against individuals, some of whom might struggle to provide information, we want to probe the choice of 10 days as the timeframe in which to provide information. Amendment 14 increases the minimum notice period from 10 working days to 28, which is similar to the standard minimum time that people would expect to be given to respond to written requests for information from HMRC. Given the scope of the information that might be requested, appropriate time must be given to organisations and individuals to comply. External circumstances should also be taken into account when considering the time periods. If an individual is on annual leave or off sick for a few days, they may have less than a week to provide the information or they will face significant fines. That does not seem reasonable. We are not necessarily saying that 28 days is a better time period than seven, but I would be grateful if the Minister explained why the Government set the minimum time that they did. That is particularly pertinent, as failure to provide the information required would carry a civil penalty of £300 a day, which, for an individual, can amount to a considerable sum of money very quickly. In its current form, without being more specific about what it means to be “reasonable” or expanding the timeframes, we are a little concerned that the powers that clause 3 gives the Minister may not include the necessary checks and balances, so I would appreciate her reassurances on that point.

• 27 Feb 2025 · Public Authorities (Fraud, Error and Recovery) Bill (Fourth sitting) · Hansard source

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  Clauses 7 to 9 give authorised investigators the powers to enter and search premises and execute search warrants, and powers for the seizure, retention and disposal of property. Those are obviously extensive powers with potentially significant consequences. While strengthening powers to tackle fraud is welcome, we have some concerns. For example, clause 7(3) states: “An authorised investigator is an individual who is authorised by the Minister to exercise the powers conferred by this section.” The clause would extend some PACE powers to authorised investigators at the PSFA to investigate offences of fraud against a public authority. An authorised investigator is defined as a Cabinet Office civil servant of at least higher executive officer grade. What training will those investigators have in order to carry out their functions appropriately? In evidence earlier this week about public sector investigators, Dr Kassem said: “Are they trained and do they have the proper skills to enable them to investigate without accusing, for example, innocent people and impacting adversely vulnerable individuals? That would be the main challenge, in my view.” –– [ Official Report, Public Authorities (Fraud, Error and Recovery) Public Bill Committee, 25 February 2025; c. 6, Q2.] Paragraph 3(2)(b) of schedule 1 states that an authorised investigator may be “a higher executive officer”, which is adding to the positions specified in PACE. The comparable position in the police appears to be specified as “a police officer of at least the rank of inspector”. Is the Minister satisfied that a higher executive officer is of equivalent rank and experience to a police inspector? Salary bands would suggest that they are not. A quick search suggests that the starting salary of a higher executive officer may be as little as £38,000, whereas a police inspector in London would typically be on at least £61,000. That suggests that there will be some disparity in the level of seniority that one might expect between the two positions. Is she satisfied that a higher executive officer has the seniority for the very far-reaching powers that the Bill would give them? Turning to clause 8, it is welcome that there is a role for the magistrates court—we finally have some external oversight—where a Minister must apply to make a decision about an individual’s property. Clause 9 amends the Police Reform Act 2002 so that an individual may go to the director general with complaints or misconduct allegations in relation to the Public Sector Fraud Authority. However, it appears that there remains discretion for the Minister, who only “may” make regulations conferring functions on the director general in relation to public sector fraud investigators and “may” disclose information to the director general. Does the Minister intend to make those regulations? What may they contain? If regulations are made under those provisions, what parliamentary procedure will they be subject to?

• 27 Feb 2025 · Public Authorities (Fraud, Error and Recovery) Bill (Fourth sitting) · Hansard source

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  Clause 10 allows the Minister for the Cabinet Office to act on behalf of another public authority to recover a recoverable amount, including bringing court or tribunal proceedings, and recovered money will be returned to the other public authority unless it is agreed that the Minister can retain some or all of it. We have some questions about what has to be agreed ahead of time. Can the Minister just act, or do they need prior approval from the public authority beforehand, so that there is clarity about the basis on which the Minister for the Cabinet Office is acting and any division of recovered funds? Clause 11 sets out the recovery notice that the Minister must give before proceedings can be brought to court or a tribunal, and what is included in it. How is it decided how much can be recovered? What assets are taken into account, and what is the process before the legal system becomes involved? Clause 12 sets out that the recovery methods can be used only to cover the amount where the liable person agrees or a court or tribunal has determined the amount is recoverable. Where the liable person does not engage, what mechanisms exist to encourage them to do so? Are there penalties if a court or tribunal is involved, and how long is the legal process typically expected to take, given current capacity? What does capacity look like at the moment? We feel that, in principle, the powers could be proportionate, but that depends on how they are to be exercised. I would be very grateful if the Minister clarified some of those points.

• 27 Feb 2025 · Public Authorities (Fraud, Error and Recovery) Bill (Fourth sitting) · Hansard source

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  Clause 5 will give the Minister enormous powers to request and share information for the purpose of facilitating the Minister’s exercise of the core functions under the Bill. Given that the Minister’s core functions are to decide whether to investigate and take enforcement action, we are concerned that almost any information could be shared to facilitate the making of those decisions. Likewise, the Minister may share information onward. If they give consent, the information may go further yet. Again, this is a case of the Minister marking their own homework. They get to decide who knows what and whether it gets shared onwards, without any external oversight from an impartial third party. I would be grateful if the Minister explained what sort of information the Government envisage being requested, under what circumstances, and what safeguards will apply to the sharing of that information.

• 27 Feb 2025 · Public Authorities (Fraud, Error and Recovery) Bill (Fourth sitting) · Hansard source

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  As the Minister says, the clause will add the Cabinet Office to the Investigatory Powers Act 2016. The Act governs the powers available to the state to obtain communications and communication data, provides statutory safeguards and clarifies what powers different public authorities can use and for what purpose. This legislation will give the Cabinet Office further and greater investigatory powers. Government amendment 1 seeks to clarify that this applies not to the whole of the Cabinet Office, but to the Public Sector Fraud Authority only. I am glad that the amendment will rectify that fairly major drafting error. Obviously, the Opposition support the amendment.

• 26 Feb 2025 · Northern Ireland Troubles (Legacy and Reconciliation) Act 2023 · Hansard source

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  People throughout the United Kingdom will be disgusted if former terrorists such as Gerry Adams receive compensation from the taxpayer because of Labour’s decision to repeal the legacy Act without putting something in its place. Will the Secretary of State finally commit himself to legislating immediately to prevent that from happening?

• 26 Feb 2025 · Family Businesses · Hansard source

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  It is an honour to rise today to speak on behalf of the very many family businesses in Kingswinford and South Staffordshire, because family businesses are at the heart of our local communities as well as at the heart of our local economies. They provide employment for nearly 14 million people, they contribute £575 billion to the economy and they are founded on solid principles of entrepreneurism and self-responsibility. I am proud to represent so many fantastic family businesses, ranging from heavy engineering firms in the Black Country to vineyards in Pattingham and Halfpenny Green. They work tirelessly to build and sustain their businesses, creating jobs and prosperity. They offer excellent products and services to customers near and far, and they look forward to their children one day continuing in their footsteps. But their job is being made much harder by Labour’s family business tax, a barrage of burdensome red tape, a trade union charter, a family business surcharge and the national insurance jobs tax, which together mean that businesses will pay more in tax and compliance rather than in growth or jobs. As has been said, the cumulative impact of all these measures is very damaging. I am not going to pretend that most of the family businesses I speak to are absolutely delighted by the increase in the national living wage any more than they were delighted the previous year when the last Government increased it by a higher amount, but they recognised that wage increases for their staff were the right thing to do. However, they do have a problem when those additional wage costs are compounded by payroll taxes in the form of increased national insurance contributions, which hit those sectors that rely on part-time workers particularly hard—they suddenly face enormous increases. That is compounded further by business rate rises for those in retail and hospitality, who are suddenly finding their business rate bills nearly doubling in April compared with what they have paid for the last few years. Also coming in in April is that flurry of additional regulations. If family businesses somehow survive all that and thrive and develop, they will find that they can no longer expect to be able to leave the business intact for future generations of their family to run. The Confederation of British Industry and Family Business UK have warned that Labour’s changes to business property relief could lead to 125,000 job losses and reduce economic output by £9.4 billion. Businesses that have survived economic downturns, global recessions, war on our continent and a worldwide pandemic now face the prospect of being brought to their knees by a tax policy that will force them to break up their businesses when the current owners pass away. This is not just a policy change; it is an existential threat. The Black Country is a region with a proud history of manufacturing and enterprise. We have always been a place of hard work, innovation and community. In South Staffordshire my constituents are proud of their thriving rural economy built on countless family businesses. Those businesses have not just contributed to our local economy; they have helped to build the United Kingdom, and the idea that a tax change could strip away the future of our local businesses is nothing short of a tragedy. Fairness would be recognising that family businesses are not just economic units but part of the fabric of our communities. They support local charities, provide apprenticeships and create jobs for those who need them. If these proposals go forward, we risk losing those businesses and with them the local jobs they provide. I have spoken with many family businesses in my constituency. Family-owned businesses that have been operating in the community for generations are fearful and uncertain, and are already having to make decisions about their businesses and their employees because of the Chancellor’s damaging Budget. Sadly, some are being forced out of business because of these measures. The Government’s blinkered view that sees business as little more than a source of revenue to offset their spending plans is wrong. I urge the Government to listen to the concerns of the family firms in Kingswinford and South Staffordshire and across the country who will be directly impacted by the changes. These proposals must be scrapped.

• 25 Feb 2025 · Public Authorities (Fraud, Error and Recovery) Bill (Second sitting) · Hansard source

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  Q Do you have any idea what the additional man hours or potential cost burden could be for a typical bank in a typical year? Daniel Cichocki: It is quite difficult at this stage to perform that level of assessment, partly because so much detail of the measure will be set out in the code of practice. We are obviously very keen to ensure that the expectations of the industry in complying with the new requirement are proportionate, but that is difficult to assess in detail before we have seen the detail of the code of practice. Much will depend on the mechanism through which banks will be required to share the information, the frequency of the information notices, whether the criteria we are required to run the checks against change over time and other factors that will influence how much capacity is required from the banking sector. As I say, at this stage it is challenging to do a detailed assessment.

• 25 Feb 2025 · Public Authorities (Fraud, Error and Recovery) Bill (Second sitting) · Hansard source

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  Q Why does the decision seem to have been taken not to introduce these as statutory instruments? Andrew Western: The codes of practice?

• 25 Feb 2025 · Public Authorities (Fraud, Error and Recovery) Bill (Second sitting) · Hansard source

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  Q Obviously, you have not been involved in such direct investigations, but just to give us some idea of the quantum we are talking about, what period of time do you think would count as reasonably speedy, so that it would not endanger an investigation? Are we talking about days, weeks or months? John Smart: I think weeks is reasonable. A small number of weeks is a reasonable number to look for, rather than days or months. Months is far too long, and days is probably a little too short in relation to the ability of organisations to respond.

• 25 Feb 2025 · Public Authorities (Fraud, Error and Recovery) Bill (Second sitting) · Hansard source

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  Q So they will be published, but in terms of scrutiny, will there be any role for Parliament in agreeing or disregarding those codes? Andrew Western: I am happy to confirm precisely—because it may be that Members, as we go through the Committee stage, make it very clear what their expectations would be—what the current proposal is before we go into line-by-line scrutiny on Thursday.

• 25 Feb 2025 · Public Authorities (Fraud, Error and Recovery) Bill (Second sitting) · Hansard source

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  Q But I am right in saying that that will be at a systemic level, rather than being able to say, case by case, “That was the wrong decision, and I am changing that decision.” Mark Cheeseman: There will be case-by-case review, but you are right; it will be more, “Here is an issue that should be dealt with, and here’s how”.

• 25 Feb 2025 · Public Authorities (Fraud, Error and Recovery) Bill (Second sitting) · Hansard source

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  Thank you very much.

• 25 Feb 2025 · Public Authorities (Fraud, Error and Recovery) Bill (Second sitting) · Hansard source

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  Q For a lot of the provisions in the Bill, those in receipt of orders potentially have a very short timeframe to comply with the demands. John Smart: Yes.

• 25 Feb 2025 · Public Authorities (Fraud, Error and Recovery) Bill (Second sitting) · Hansard source

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  Q What recourse would individuals have who are adversely affected, whether it is by machine-made decision making or even human decision making? Ellen Lefley: That is where it gets quite tricky, because of course the first barrier would be even knowing that you have been subject to any kind of algorithmic decision making or algorithmic-assisted decision making. If you have been subject to a completely automated decision, the new data Bill that is coming through will enable you to make representations and to request human intervention after the fact. But if algorithms are assisting a human decision-making process, there is no right to be notified, let alone to complain. The position of someone who has been subject to one of these decision-making processes also needs to be considered in a very realistic way. The motivation, empowerment, means and brain space to complain in such circumstances cannot always be relied on. Justice is clear that while access to redress is always important, preventing unfair and discriminatory decision making always needs to be the priority.

• 25 Feb 2025 · Public Authorities (Fraud, Error and Recovery) Bill (Second sitting) · Hansard source

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  Q At the heart of this Bill is the establishment of the PSFA as a separate body outside the Cabinet Office. What do you see as the practical benefits that that move will bring? How will you better be able to serve the public sector? John Smart: I think being fully independent would probably be helpful, although I suspect that the realistic impact of that will be more theoretical rather than practical in the short term. Maybe, in the longer term, a fully independent, stand-alone organisation would be much more helpful.

• 25 Feb 2025 · Public Authorities (Fraud, Error and Recovery) Bill (Second sitting) · Hansard source

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  Q It is absolutely a minimum, but is it correct that varying from that minimum is at the discretion of the Minister? Mark Cheeseman: Yes, in the legislation.

• 25 Feb 2025 · Public Authorities (Fraud, Error and Recovery) Bill (Second sitting) · Hansard source

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  Q What consultation has there been with industry to make sure that the eligibility verification measures are workable and that your members will know what is required of them? Daniel Cichocki: A number of conversations with the industry have taken place since the measure was announced. We have been very clear since the announcement was made that we are supportive of the efforts to tackle fraud and error in the public sector. We recognise the scale of the challenge that the Government face, and as a private sector we see clearly the damage fraud does to both the public and the private sectors. We are very supportive of the objectives of the Bill. As you say, the key thing for us as a sector that is heavily regulated, both from a vulnerable customer treatment stance—my colleague Eric Leenders is best placed to talk about that—and a financial crime compliance perspective, is that more detail on the specifics of how the measure will work is still to emerge through the code of practice, but extensive conversations about that are under way. From the banking industry perspective, we are keen to ensure that the compliance requirements for banks are clear in terms of what information is required. We hope to see in the code of practice, as soon as is practical, details of the specific criteria against which the Government will mandate banks to perform checks under the measure.