QUEEN’S SPEECH 2012
The Queen's Speech took place this morning in the House of Lords. The Queen's Speech establishes the Government's priorities, and informs us on what directions the Government will take on many public policy platforms.
Our analysis of the Queen’s Speech will tell you, sector by sector, what to expect in the next 12 months in terms of legislation and policy and how the initiatives in the Speech will impact you.
Our predictions have been played out in a Speech which introduces the Enterprise Bill, Banking Reform Bill, exemption from contribution to the European Stability Mechanism, Children and Families Bill, and Lords Reform.
Sectoral Comment on Queen’s Speech:
We have focused on specific areas: Health & Social Care, Education and Skills, Life Sciences, Renewables and Energy, Technology and Communications, Lobbying, the Third Sector and Planning.
Traditionally, the Queen’s Speech marks the State Opening of Parliament and the beginning of the Parliamentary session. The Speech outlines the Government’s proposed policies, expected legislation for the coming session, and an overview of what has been accomplished in the past session. While it is the Queen who delivers the speech in the House of Lords, the text is prepared entirely by the Government and approved by the Cabinet.
If you have any questions or would like more information, please contact us and we would be happy to help.
Health and Social Care – Ros Trinick
Given the prominence of social care on the media’s agenda, it is perhaps unsurprising that the Queen today confirmed “A draft Bill will be published to modernise adult care and support in England.”
What has come as perhaps more of a surprise, is the confirmation that despite the importance the Government has attached to Social Care, only a draft Bill will be brought forward in Parliament’s next session.
It seems the heady days of the Health and Social Care Bill, given Royal Assent on 27th March 2012 and pushed through relentlessly by Coalition Whips, are not to be repeated soon by a dedicated Social Care Bill. The original commitment for a White Paper on Social Care was for Spring 2012, with a Bill scheduled for Autumn, but the deadline has been repeatedly pushed back.
In the run up to today’s speech, pressure has mounted with the publication in Tuesday’s Daily Mail of an open letter drafted by a coalition of 78 charities and campaign groups calling on the Prime Minister to urgently reform social care. The letter, signed by organisations including Age UK, Saga, the Local Government Association and the Association of Directors of Adult Social Services, calls on David Cameron himself to make it his personal mission to reform the social care system.
The draft Bill will address some of their concerns, specifically looking at modernising the legal framework for care and support, and responding to the recommendations of the Law Commission, which were published in May 2011.
However, amidst such widespread pressure, why has the timetable slipped so dramatically? The simple answer to the question is money and political risk.
When the Government commissioned economist, Andrew Dilnot, to write a report on the future of funding long term care, it was seeking to address an issue that has been repeatedly kicked into the political long grass. The result was the Dilnot Report, released in July 2011 and generating a very positive response. Where currently, anyone with over £23,500 in savings is liable for all the costs of their care, Dilnot proposes that those who have less than £100,000 in savings and assets should not pay for care. Moreover, the Report recommends a cap of between £35,000 and £50,000 on the amount people have to pay for their care, with the State stepping in to cover the rest.
The obstacle to implementation is – as ever – the Treasury, which is apparently not happy with the projected £1.7billion cost of the reforms. As the Queen stated in the first line of her speech today, the central aim of the Government is to reduce the deficit.
So, what will the impact of today’s announcement be on the sector? Unfortunately, residents, relatives and care providers will continue to face uncertainty on how care is funded. In a context where local authorities have less and less to spend on care, these latest developments offer little reassurance, for commissioners or providers. The political risk to a Government suffering in the polls seems to be stunting progress.
But at least we now know what will happen with the Health and Social Care Act – or do we? If you were thinking that Royal Assent was the end of the furore, then think again. Due to the huge changes contained within the Act, as well as what some have referred to as the Department of Health’s “obsession” with passing all reforms through Parliament, the legislation now faces a second round of voting to create the new organisations within the Act (including Health Watch and GP consortia).
Thus, after unprecedented parliamentary scrutiny, and having been debated for a total of 50 days, (the most a Bill has been scrutinised since 1993) Coalition MPs are now facing another round of unpopular votes.
We can only hope that the draft Social Care Bill will inspire more cross party consensus and address the issues that have for so long been ignored.
Education and Skills – David Noble
This year, the Queen’s Speech placed little emphasis on the education and skills sectors with the general focus being ‘economic growth, justice and constitutional reform’. There had been speculation regarding the inclusion of a Higher Education Bill following the publication of the Higher Education White Paper in June 2011. However it is not surprising that this wasn’t included given the divisions within the Coalition as to the scope of the Bill. The purpose of the White Paper was to ensure potential students from low income backgrounds are not put off by the increased tuition fees – a laudable ambition. However, the controversy is focused on measures that would make it easier for private providers to gain degree-awarding powers and to complete the partial or complete buy-out of universities.
Education reform under the Coalition
The Coalition Government has made commitments to further education reform, as exemplified by the last time the Queen spoke in the House of Lords where she outlined what would become the Academies Act. This legislation caused significant upheaval to the education sector, in a similar manner to the effect on the health industry of the Health & Social Care Act. These reforms have greatly facilitated ‘maintained’ schools becoming academies. Only recently the Department for Education confirmed that almost half of the schools in England were already, or about to become, academies.
Further to this, during the last Parliament we saw the decision to allow universities to charge tuition fees of up to £9,000 per annum. More recently, we have seen initiatives to tackle absenteeism, reforms to Ofsted’s inspection practices and a new focus on teaching standards and continuing professional development, all of which tells us that the Government remains committed to reform.
What to expect in the next Parliament
We should not expect, despite the scant mention today, that the education and skills sector will be void of further upheaval. The 2012 Budget referred to the school reforms that “will do more to improve the long term economic performance of our economy than any Budget measure ever will.” The Queen also highlighted simplified measures for Children with Special Educational Needs and disabilities.
Specifically we should expect the continuing trend of the curriculum rolling back to ‘core’ subjects such as Science, Technology, Engineering and Mathematics (STEM). Yet the Budget did not mention specifically how the up-skilling of our future workforce would be achieved, with only fleeting mention given to reviewing VAT for providers of education and the growth of technical colleges.
The Government has given us little insight into what the next 12 months could mean for education and we must wait and see what the future brings. We expect, unsurprisingly, that economic recovery will remain the focus for the Government in what will be a more business-like Parliament. This is in comparison to the waves of controversy caused by austerity cuts and reforms to the health and education sectors which dictated the last session. It is safe to say that education, and growing a highly skilled workforce will continue to be at the forefront of the political agenda, despite its minimal referencing in today’s Queen’s Speech.
Life Sciences – Joe Wildy
On the surface of it this Queen’s Speech seems to contain little of interest to the life science sector. However, scratching beneath the surface shows that there is potential for a lot of food for thought which may require action.
It would be easy to assume that many of the ‘big issues’ that faced the life sciences sector were put forward during the last Parliament. However, the life sciences industry is broad, encompassing pharmaceuticals, biosciences, diagnostics and devices. There are a number of measures and proposals contained within other pieces of legislation on the slate for 2012-13 that will have deep and meaningful impact for companies, charities and academics working in the life sciences in the UK.
Okay, so the Health and Social Care Act was passed in March. But in order for the measures contained within the Act to be implemented there are rafts of changes to be made. For example, changes to the way new medicines are commissioned and the way in which companies can deliver services on behalf of the NHS will create opportunity (for business) and uncertainty (for patients) in equal measure. No doubt stakeholders ranging from large pharmaceutical companies and health care providers all the way through to GPs and patients will be clamouring for their say on how this Act is implemented.
Outside of this piece of legislation, the Finance Bill should be on all life science companies’ radars. It contains a number of measures which will have both positive and negative impacts on the sector. For example, the introduction of the Patent Box, creating an incentive for companies to drive revenues from patents through the UK, rather than taking their commercial operations to more tax-advantageous regions such as Switzerland is a real opportunity for larger companies, while changes to R&D tax credits could radically improve a company’s short term prospects for investment and long term growth prospects. Added to this, measures such as the Seed Enterprise Investment Scheme will go a long way to encouraging Angel investors to look at the UK as a positive location for investing in start-up tech businesses.
Despite this, there could be a real sting in the tail for life sciences and particularly life sciences charities in the form of a government proposal to introduce a cap on tax relief for large charitable donations. The Government’s rationale for this cap is to prevent tax avoidance, an ambition they highlighted in the Coalition’s Programme for Government back in June 2010. However, many commentators think the price paid is too high. The Prime Minister has a stated ambition to make Britain a bastion for philanthropy, yet this measure seems to fly in the face of that worthy goal and the government has already been forced into a rethink.
Also on the slate for 2012-13 is a revised Defamation Bill. Many will remember the notable comments made by Simon Singh about Chiropractors and the case that was brought against him by the British Chiropractic Association. For those who do not remember, Simon’s Comments were considered as libelous by the BCA who subsequently decided to sue.
Fortunately for Simon, the BCA later dropped the case, but, in light of this and calls for reform of libel laws, the draft Defamation Bill was published in the House of Lords. The draft Bill seeks to address the reasons why science writers such as Simon, Peter Wilmhurst and Ben Goldacre, have been put in the unenviable position of being sued for expressing their opinion.
Renewables and Energy – Tim Knight
David Cameron’s somewhat bland introductory remarks at the Clean Energy Ministerial event in London were in sharp contrast to the speeches given by his Danish and German counterparts, who could boast of real achievements in the energy and renewables policies of their respective countries. Despite the Conservatives’ self-proclaimed ambitions to be “the greenest government ever,” most observers would agree that the government’s progress in energy and renewables has been somewhat restricted. David Cameron’s famous (infamous?) trip to the Arctic when in opposition was an attempt to portray himself as the greenest of the three main parties, but the realities of Coalition Government and competing political priorities have meant that this is not yet the case.
However, as many have observed, it is clear that the government’s strategy thus far has been to bite the bullet and to undertake as much of their controversial programmes of legislation early on in the political cycle. Attempting to reduce the deficit, reforming higher education and restructuring the NHS so soon after the General Election was a smart ploy. So now that the next election is three years away and the government’s popularity is possibly at its lowest ebb, now might be the time to pursue the ‘softer’ policies, which are less controversial.
Dominating the political agenda in this sector over the next 12 months will be the forthcoming Energy Bill, which was announced in today’s speech and will build on the Energy Acts of 2008, 2010 and 2011. However, it remains to be seen exactly when the Bill will be introduced. Earlier this week, rumours emanating from Westminster suggested that the Bill may be delayed, a victim of the large amount of time and political capital that will have to be expended on Lords reform. DECC have refuted and stated that they fully expect the Bill to be legislated these rumours and claim that the Bill will be legislated by the end of 2012.
Additionally, today’s speech introduced Vince Cable’s Enterprise Bill, which is designed to stimulate economic growth and includes the logistical roll out of the forthcoming Green Investment Bank. The Bank, which as announced in March will be based in Edinburgh, will lend to private sector enterprises who want to invest in the green economy. However, the austerity drive has meant that the timetable for the Bank has been pushed back, and it will now not begin lending until 2015, three years later than was initially envisaged.
Impact of Legislation
Although the exact details of the Bill have yet to be clarified, it appears that the government’s approach to reforming the electricity sector will pursue a four pronged approach. Namely, the Bill will i) seek to discourage further private investment in carbon intensive infrastructure, ii) introduce a carbon floor price which states that polluters must pay for the right to pollute, iii) introduce an Emissions Performance Standard, which has been described as a “regulatory backstop” and will in practice ensure that any new coal fired power stations incorporate carbon capture and storage capabilities, and iv) introduce a capacity mechanism which will ensure that there is an adequate margin of capacity in the national grid and minimise the risk of energy shortages or blackouts.
A further crucial element of the Bill will be Electricity Market Reform (EMR). A White Paper on the topic was published in July 2011 and promised to invest £110 billion in revamping the UK’s electricity generation infrastructure, thereby ‘decarbonising the economy’ and ensuring that at least 15% of the UK’s energy comes from renewable sources by 2020. This is likely to be highly controversial, as it will likely lead to further increases in bills for consumers.
Developers across the energy spectrum are eagerly awaiting further news on the Bill, with investors wary of releasing funds until the policy framework is clarified. Those developers who have been forced to look abroad for funding during this Parliament will hope that an increase in clarity from the government will mean that this is no longer necessary.
Technology and Communications – Jessica Litwin
The Digital Britain Report by the previous Government in 2009 recognised the strategic role that technology has on the UK’s economy both in its own right and as infrastructure supporting the success and viability of all other sectors. This Government has ambitions to ensure that both rural and urban areas can take advantage of technology as part of their economic strategies. Indeed, broadband is an example of how technology has been integrated into the Government’s overall policy platform as part of the “Big Society”.
Communications Regulatory Framework
In 2011 the Department for Culture, Media and Sport (DCMS) undertook a review of communications policy to ensure that a regulatory framework is in place that is fit for the digital age. The review will culminate in a new Communications Framework by 2015, outlining how Government will support the sector for the next 10 years and beyond. The overall ambition is for the UK to have one of the most dynamic and successful media and communications markets in the world.
Therefore, the Queen’s Speech must be seen as a teaser to the publication of a Communications Green Paper, which will be followed by a White Paper and a draft Bill in mid-2013.
Underpinning this Green Paper will be the report from Frontier Economics (commissioned as part of the Review) on the contribution of the communications sector to the economy.
The analysis demonstrates that the communications sector is a significant component of the UK economy, accounting for over £50 billion (4.1%) of total UK Gross Value Added (GVA) of which the largest part is the technology sector (£21.2 billion or 1.7% of GVA). The paper suggests that a 1% increase in investment in ICT could generate up to a 0.06% increase in overall economic growth.
Therefore, the Green Paper will likely focus on the factors contributing to the sector’s continued growth, including the quality and coverage of infrastructure, organisational factors and the regulatory framework. If you would like to read more detail on the feedback received during the public consultation process leading to the Green Paper, consult the non-confidential responses.
PLMR predicts that the Green Paper, White Paper and subsequent 2013 Bill will include major infrastructure investment and fiscal incentives to encourage growth in the communications sector in the UK and enhance the viability of emerging companies. It will be essential to ensure that the regulatory framework is sufficiently flexible to encourage the dynamic growth and evolution of the sector while at the same time keeping up with technological advances. This is an experience that has been seen in the life sciences sector over the past 30 years and there are lessons that ICT can learn.
The Counter-Terrorism Strategy
The other hot topic in technology in the coming year will be the implementation of the July 2010 Counter-Terrorist Strategy. In April 2012, the Sunday Times reported that the legislation would allow GCHQ to monitor the content of communications without obtaining a warrant; it would permit the intelligence agency to trace whom a person or group had contacted, when, for how long and for how often.
This legislation has led to a massive backlash in the press and will likely instigate accusations from privacy watchdogs that the government is invading the privacy of ordinary people in the UK. We wait with interest to see how this develops.
Lobbying – Chris Calland
Interestingly, despite much anticipation amongst the public affairs and PR industry, one expected Bill was notable by its absence from the Queen’s Speech – specifically, a Bill to reform the regulation of lobbying.
When the House of Commons’ Political and Constitutional Reform Committee undertook an inquiry into the introduction of a statutory register of lobbyists, PLMR decided to take a stand: “A simple statutory register that lists clearly the activities of organisations engaging in lobbying activities is now urgent”.
We believe that a statutory register represents a new dawn for the lobbying industry because transparency is at the core of good lobbying. There is no longer any reason why this cannot be the norm across the public affairs industry. Thus it is disappointing that there was no mention of a Bill today (although we shall have to see whether further details will emerge in the coming days).
PLMR is one of a large number of companies carrying out work to help organisations and causes get a hearing they deserve in political institutions and the media. However, it is clear the nature of the work that lobbyists do – as a part of the democratic process – is not widely understood.
Therefore it is a shame the Government did not choose to announce today a Bill that increases public understanding and enables standards to be maintained at a high level. In particular, it would have been beneficial to see moves today towards a statutory register that replaces the multiple registers controlled by the existing industry bodies – the APPC, PRCA and UKPAC and the CIPR. This would centralise the process for registering and allow Parliament to set parameters and enforce a code of conduct.
It is absolutely essential that the activities of unscrupulous so-called lobbyists, who operate outside of any form of professional code, are not used to disgrace the wider industry.
There are of course certain aspects of agency/client information which need to be protected – confidentiality between client and an agency/practitioner is often crucial to protect commercial interests. Indeed, financial disclosure could merely serve to make lobbying less transparent, as a large part of the opaque face of public affairs is where lobbying meets legal management consultancy. It is not that there is an ethical problem here, but it is important that any register captures all forms of lobbying.
In sum, it is better to have no Bill than one that would be disproportionate to the problem it is trying to solve. For example, PLMR’s consultants come from backgrounds in the House of Commons and the Civil Service. As a result, they have formed personal acquaintances with figures inside the UK Parliament. Is it therefore realistic to record every interaction between lobbyists and politicians? Politics is a collective activity where communication, networking, and interaction are essential. And given the very nature of our work, we come into contact with political figures in a personal capacity all the time – something we hope to see born in mind whenever we do see a Lobbying Bill produced
Third Sector – Peter Elms
“A Bill will be introduced to reduce burdens on charities, enabling them to claim additional payments on small donations”
The Coalition’s Programme for Government pledged to take a range of “measures to encourage charitable giving,” as well as “support the creation and expansion of mutuals, co-operatives, charities and social enterprises, and enable these groups to have much greater involvement in the running of public services.” All very Big Society-ish.
The last Budget did not seem to give quite the same message.
It announced that the Government would introduce a cap on tax reliefs on charitable donations, which would mean from next year, individuals who give money to charity will only be able to claim tax relief on 25 per cent of their total income, or £50,000, whichever is higher (these reliefs currently amount to around £3bn a year). The Guardian felt that the Budget did not do “a lot to support and develop social investment, very little new for charities and some distinctly worrying elements that we all need to keep a very close eye on.” It was always going to be interesting to see what the Queen’s Speech came up with today, in light of the Budget’s announcements surrounding charities.
Today’s announcement that there would be a Bill to ‘reduce the burden on charities’ is likely to be in reference to the ‘Small Donations Bill’ which is expected to enable charities to claim Gift Aid on up to £5,000 of small donations per year without the need for Gift Aid declarations. The Government will be, in part, attempting to combat the negative headlines that occurred after the Budget, that focussed upon the charitable donations of the ‘have yachts’ (as opposed to the have nots).
So the message now appears to be that if you are going to give to charity, as with most things in life: give little and often.
Planning – David Madden
If you were looking for the Queen’s Speech to provide enlightenment on the Government’s plans to realise their aspirations for a quicker, more efficient and more effective planning system, it wasn’t worth looking too hard.
Following the damp squib that was the publication of the National Planning Policy Framework (NPPF) in March this year, variously described prior to publication as a developers’ charter or as giving builders a remit to build over our green and pleasant land, those seeking some clarity on exactly how we were to see a growth-enabling presumption in favour of sustainable development put into practice will be feeling pretty short-changed.
The House of Commons Library’s Standard Note on the Queen’s Speech identified 33 Bills that may be referred to (15 from the existing Session, 14 foreshadowed and four anticipated drafts). Not one of these related to planning or creating a policy designed to speed up the process for granting permission for sustainable development. As recently as this Tuesday 7th May, the Communities and Local Government Select Committee published a report on the financing of new housing supply which acknowledged that 230,000 households were forming each year, but in 2011 only 110,000 new homes were built. Yet the report suggested that the problem lies with financing new development rather than securing permission in the first place. Construction firms large and small throughout the country would no doubt beg to differ.
So, why aren’t we seeing legislation being implemented that would help turn the aspirations expressed in the NPPF into reality? The simple, some might say cynical, answer is the Government doesn’t need the flak. The wave of criticism generated by the NPPF, which we must remember simply comprised the broad-stroke recommendations upon which local planning policy should be based, was significant and coordinated. For a Government facing fierce criticism on a swathe of existing policy – health reform, austerity, Europe – creating another rod for its back is pretty low on the agenda.