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February in Westminster: What's on the horizon

1 February 2017

After Prime Minister Theresa May confirmed her intention to pursue a potentially "hard" Brexit should the UK not get its way in negotiations, this February Parliamentarians face the definitive choice of a generation as they consider whether to throw their support behind the Article 50 trigger Bill.

Meanwhile, the Industrial Strategy proposals are making waves in the business world, and public services are vying for attention amid competing priorities and continued budgetary pressures.

Here, DeHavilland's expert Monitoring Consultants outline the issues to watch in each sector.

Education

One of the Industrial Strategy Green Paper’s ‘pillars’ involves ministerial plans to build a “proper system” of technical education. This was confirmed through the strategy's commitment to creating a single clear framework of approved technical qualifications at Levels 4+, as well as the Institutes of Technology, which will deliver higher-level technical education in STEM subjects. However, there are concerns that this relatively small investment is unlikely to bring about a much-needed revolution in vocational education.

As the Higher Education and Research Bill concludes its Committee Stage in the Lords, the Report Stage presents the last real chance to amend it. There are many elements that require full scrutiny, but the fact that House business must be cleared to give time for the Brexit Bill’s short timetable means concessions may be given to speed up the process. When we consider that the establishment of the Office for Students and UK Research and Innovation (UKRI); changes to the granting of degree awarding powers; and the linkage of the Teaching Excellence Framework (TEF) to fee levels all depend on the Bill passing quickly, Opposition Peers will almost certainly use this to their advantage.

Energy and Environment

As part of the Industrial Strategy Green Paper, the Government announced two new reviews to minimise long-term business energy costs and reduce the cost of meeting the UK's decarbonisation targets. It also included information on an early sector deal for the nuclear industry, designed to improve UK competitiveness and skills in nuclear.

Also last month, the Government announced a sizeable £28m funding boost for low-carbon technologies. Coming up, the next Capacity Market Auction is due to launch, with firms bidding for subsidies to provide back-up power when needed.

In February, the Government is expected to publish its Emissions Reduction Plan, which will aim to get the UK back on track to meeting its carbon targets beyond 2022. A number of Government consultations on energy come to a close next month, which will inform a lot of the policy direction for the sector.

Financial Services

High street banking hit the headlines again in January following HSBC's announcement of the closure of 62 bank branches nationwide, causing an uproar from many MPs representing rural areas.

Meanwhile, from a macroeconomic perspective, the Bank of England is set to deliver its latest verdict on interest rates on Thursday, with many expecting the Bank rate to remain the same as UK growth continues to be higher than anticipated.

Coming up on the Committee corridors, the Treasury Committee has announced an inquiry into the work of the Payment Systems Regulator, while the Economic Affairs Committee has published a call for evidence for its new inquiry, Brexit and the Labour Market, and is inviting written submissions from companies across the UK regarding how a reduction in migration will affect their business and employees.

Finally, the first of 2017's twin Budgets is fast approaching, and the sector will be alert as ever for mentions of any new tax or spending initiatives set to be announced on 8 March by Chancellor Philip Hammond.

Pharma and Health

Throughout January, Health Secretary Jeremy Hunt found himself under sustained pressure from the media, the Public Accounts Committee and Health Committee, and even colleagues from within his own ranks, about the situation in the health service.

Looking ahead to February, this month should see the completion of the passage of the Health Service Medical Supplies (Costs) Bill, which brings the statutory scheme for unbranded medicines into line with the voluntary scheme's arrangements for branded drugs.

We can also look forward to the Health Committee continuing its inquiry into Brexit and its impact on health and social care, as well as the all-important suicide prevention inquiry - of particular importance after mental health was highlighted by the Prime Minister in January as a top priority for her administration.

Tech and Telecoms

With the Industrial Strategy Green Paper launched, the next big item of interest for tech and digital sectors is the long-awaited Digital Strategy. While no date has been made public for its release and it is rumoured that February will come and go without its publication, stakeholders will doubtless remain engaged with its potential contents, while also making the most of the Government's avowed intention to focus on boosting the UK's creative industries.

Meanwhile, the Digital Economy Bill will be scrutinised at its Lords Committee Stage, while the Culture, Media and Sport Committee will take oral evidence from witnesses as part of its inquiry into the impact of Brexit on the Creative Industries, and a new inquiry into "fake news" will no doubt seek input from the tech and media sectors.

Transport

The publication of the Industrial Strategy Green Paper included some information on an early deal for the automotive sector which should get industry voices talking, and also saw the Government recommitting to a number of infrastructure policies. The Government also announced funding allocations for the "Northern Powerhouse" from the third round of Growth Deals. Funding allocations for the "Midlands Engine" are expected in early February.

The Bus Services Bill was due to have its Second Reading in the House of Commons on Tuesday 31 January but this has been superseded by the Government’s European Union (Notification of Withdrawal) Bill. With the Brexit Bill taking up the majority of time in the Commons for the next few weeks, the Bus Services Bill is expected to have its Second Reading after the February Recess.

Elsewhere, the Transport Committee has launched an inquiry into airspace management and modernisation, and the Government is expected to launch a consultation on measures to support airspace modernisation shortly. The Government is also expected shortly to publish its Airports draft National Policy Statement and consultation on proposals for a third runway at Heathrow. This will begin the long process required to expand Heathrow, with a vote in Parliament not expected until the winter of 2017-18.

Finally, there have been rumours this January that the Department for Transport (DfT) is considering options to take control of Southern Rail services - including the DfT potentially taking control of the Thameslink, Southern and Great Northern franchises. While the DfT has denied these rumours, the Transport Committee is pushing the Government to make a decision on Govia Thameslink Railway’s invocation of force majeure, contractual provisions governing contractual breaches due to events beyond its control.

What's on your agenda?

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DeHavilland
The DeHavilland Monitoring Team

DeHavilland's Monitoring Consultants deliver a service tailored to our clients' individual needs, enabling them to cut through the noise, assess changes to the political landscape and conduct bespoke research tasks.