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Brexit, Article 50 and the High Court

Week in Westminster

Published: 4 November 2016 | Author: Michelle Vosper

The High Court has ruled that the government does not have the power to trigger Article 50 without first having a vote in Parliament. The government is intending to appeal this decision in the Supreme Court. A statement will be made in Parliament on Monday to give more clarity on the situation.

Assuming the ruling is upheld at appeal, Article 50 will have to be triggered by an Act of Parliament meaning a bill will need to be tabled, probably in January. The government is likely to want to keep such a bill short and tightly drawn so its scope is as narrow as possible for MPs and peers to lay amendments. It is also likely to want to timetable the bill to expedite its progress. Nevertheless, there is a limit to how for the government can control the bill’s passage and while MPs and peers are unlikely to see to prevent Article 50 from being triggered, they may well use this opportunity to put much greater pressure on the government to outline its fundamental vision for Britain outside the EU.

The government continues to insist that Article 50 will be triggered by the end of March 2017. However, if an act of Parliament is required, a delay in the timetable for triggering the withdrawal process becomes more likely. There is also lots of speculation that if the prime minister is unable to gain parliamentary approval for triggering Article 50, she may be forced into an early general election. Number 10 is resolutely sticking to the message of an election in May 2020.

Meanwhile, the impact of Brexit on financial services was the subject of an adjournment debate in the Commons.  Responding economic secretary Simon Kirby said the government aimed to do what was best for the UK economy and maintain the quality of financial services available to British customers and taxpayers.

Financial advice and bill activity

The Savings (Government Contributions) Bill has completed its committee stage without amendment. SNP MP Ian Blackford moved an amendment that would delay the introduction of the new Lifetime ISA and Help to Save products until an independent pensions and savings commission is established. The body would aim to “help us steer a long-term, sustainable path for pensions and savings”, Mr Blackford said. Responding financial secretary to the Treasury Jane Ellison said government wanted individuals to benefit from these products as soon as possible. She pointed out that specific advice could be given to consumers by the various advisory bodies, including the Money Advice Service and its successor organisation. And the Financial Conduct Authority would consult shortly on the regulatory framework for providers that will offer Lifetime ISAs, including any suitability tests that should apply to ensure products are transparent and are sold with suitable safeguards in place. Mr Blackford’s amendment was defeated 10 to 6 on division.

The omission of measures in relation to financial advice within the Pension Schemes Bill was raised by peers during the Bill’s second reading in the Lords. Following a recent consultation on a new delivery model for government-sponsored financial guidance, the government has decided to create a single financial guidance body instead of a two-model body as initially intended. For this reason, Lord Young of Cookham confirmed that the government intends to consult later this year on this proposal. In the meantime, the Money Advice Service, the Pensions Advisory Service and Pension Wise will continue business as usual.

Housing subjects of debate

Labour’s Lord Griffiths of Burry Port introduced a debate on the impact of the shortage of housing on the desire of people, particularly the young, to live in the communities where they were born, raised and educated. DCLG minister Lord Bourne of Aberystwyth said the government is being pressed to do two things: help home ownership and provide assistance for other forms of tenure, for example “to provide encouragement for the private rented sector”. Both of which the minister said would be reflected in the forthcoming white paper to be published before the Christmas recess. “I hope it will be a seminal white paper that will look at some of the challenges we face and how we can transform the position, which means building far more”, he said.

Issues around the regulation of social landlords and housing in Kent were also debated in the Commons this week.

Future flood prevention

The Commons environment, food and rural affairs committee are calling for an overhaul of flood management in England to tackle the rising risk of flooding. In its second report on future flood prevention, the Committee recommends a new governance model with a new National Floods Commissioner responsible for flood management in England. On flooding insurance specifically, the report says: “Flood Re appears to be allowing many households previously unable to do so to obtain affordable flood insurance cover. However the scheme is intended to provide a transition to an open market in insurance provision: it is therefore vital that Flood Re and insurance companies provide policy holders in flood risk areas with easily understandable information about the subsidy they are receiving so that they fully understand the need to improve their property’s resilience…In addition, flood insurance policy terms should allow for ‘building back better’ so that repairs to a flooded property can proactively deploy the full range of resilient materials and products. The Government should also review with the insurance industry how policy terms might incentivise the use of flood resilience measures by householders and businesses and report on this by January 2017.”

Wales’ housing plans

The communities and children secretary Carl Sargent set out how the Welsh government plans to deliver its target of an additional 20,000 affordable homes and complete the task of meeting the Welsh housing quality standard. These plans include:

  • developing more ambitious house building programme in terms of design, quality, location and energy efficiency
  • supporting a variety of housing tenures
  • supporting construction of more than 6,000 homes through the Help to Buy scheme
  • promoting a range of routes into home ownership at an affordable cost, particular for first-time buyers
  • developing a Rent to Own Scheme
  • continuing to support construction of social housing and the Social Housing Grant