That the Russia (Sanctions) (EU Exit) (Amendment) (No. 3) Regulations 2024, (SI, 2024, No. 834), dated 29 July 2024, a copy of which was laid before this House on 30 July, be approved.
The instrument, which amends the Russia (Sanctions) (EU Exit) Regulations 2019, was laid before Parliament on 30 July using powers provided by the Sanctions and Anti-Money Laundering Act 2018, and entered into force on 31 July. For clarity, the instrument was first laid on 24 May under the previous Government. This Government support the aims of the instrument, so we revoked and re-laid it to provide additional time post election for the required parliamentary scrutiny. There are no amendments to the policy in relation to Russia sanctions, and the substance of the instrument remains the same.
The United Kingdom’s commitment to Ukraine is iron-clad. In July, the UK contributed £40 million to NATO’s comprehensive assistance package for Ukraine, which ensures that Ukraine will access vital assistance for counter-drone technology, de-mining of reclaimed land, and the medical rehabilitation of injured Ukrainian personnel. Ukraine has placed new orders for ammunition worth £300 million through the international fund for Ukraine, which is administered by the UK.
Sanctions, too, are a crucial tool to weaken Russia’s ability to attack Ukraine. In July, the UK hosted the European Political Community at Blenheim Palace, where more than 40 countries signed a call to action to tackle Russia’s so-called shadow fleet: a fleet of ageing oil tankers, which use deceptive shipping practices and substandard insurance to attempt to undermine sanctions on Russian oil. At the event, the UK spearheaded action against the shadow fleet when we sanctioned 11 oil tankers. Through this action, we continue to demonstrate the UK’s steadfast commitment to Ukraine and underline our leading role in eroding Russian oil revenues.
Targeted sanctions against oil tankers have had a material and immediate impact. UK sanctioned tankers have been left idling, knocked out of the Russian oil trade and for the most part unable to load new cargoes. The instrument provides the basis for those sanctions, and has enhanced the UK’s ability to respond to Russia’s increasingly desperate and reckless attempts to undermine our and our partners’ sanctions.
I thank the Minister, welcome him to his place, and wish him well in his role.
I have been sanctioned by China and Russia, along with many others in this House—it is almost a badge of courage—but that is not the issue. My understanding of today’s sanctions is that businesses and those who have super yachts will be impacted directly, but that is all that the instrument means. If that is the case, will the Minister ensure that our sanctions have enough teeth to bite, and to be painful?
I thank the hon. Member. If he allows me, I will go a little further into the introductory remarks, which I hope will specify why this afternoon’s measures will provide greater teeth. I hope that will answer his concerns, but if it does not, I will return to him.
The instrument, as well as increasing the effect on shipping, also broadens the designation criteria under the Russia regime. It expands our powers to target those who provide financial or material support to Russia’s war machine. That could include, for example, foreign financial institutions that facilitate significant transactions on behalf, or in support, of Russia’s military industrial base. That is in line with steps taken by partners and the G7’s commitment to curtailing Russia’s use of the international financial system to further its war in Ukraine.
Let me turn now to the measure about which the hon. Member for Strangford (Jim Shannon) asked. The instrument adds new relevant activities to the existing power in the Russia sanctions regime under regulation 57F—“specification of ships”—to provide the criteria to sanction individuals’ ships. The amendment provides that a ship may be specified by the Secretary of State where there are reasonable grounds to suspect that it is, has been or is likely to be used for any activity whose object or effect is to destabilise Ukraine, to undermine or threaten the territorial integrity, sovereignty or independence of Ukraine, or to obtain a benefit from, or support, the Government of Russia. That includes where a ship is involved in carrying dual-use or military goods, oil or oil products that originate in Russia, or any other goods or technology that could contribute to destabilising Ukraine or to undermining or threatening the territorial integrity, sovereignty or independence of Ukraine.
Where a ship is specified under regulation 57F, it will be subject to measures in regulations 57A to 57E—the shipping sanctions. Where those sanctions apply, a specified ship is prohibited from entering a port in the UK, may be given a movement or a port entry direction, and can be detained or refused permission to register on the UK ship register—or, indeed, have its existing registration terminated. Additionally, UK persons and persons in the UK cannot provide funds and financial services, including maritime insurance, or brokering services, in relation to specified ships that are transporting certain oil and oil products, and cannot use specified ships to supply or deliver Russian oil and oil products, regardless of the price of the oil on board.
I understand; the Minister has laid out the system very simply. It applies to the EU, but we all know that those who seem to break most of the rules are India and other countries across the world that are out to buy Russian oil. If that is the case, what discussions have been had to ensure that India does not contravene what we are trying to do through these sanctions?
I say gently to the Minister that we have only an hour and a half for this debate. I know Members want to speak and I do not want to take any of that precious time away.
In conclusion, European security is a key focus of this Government. Supporting Ukraine remains vital to that end, and the UK is committed to doing so. I am sure that, when I come to answer hon. Members’ questions, I will have an opportunity to say a little more about how we work with our partners, including India, on these matters. We will work with international partners to ensure that the values of democracy, human rights and international law are maintained. This legislation and subsequent sanctions made under it show our commitment to Ukraine as it defends its freedom in the face of Russian aggression. British support remains iron-clad. I commend the regulations to the House.
As this is the first time that I have appeared opposite the new Minister at the Dispatch Box, I wish not only to congratulate him but to welcome him to his place. In a previous life, we served together in the Foreign Office. He is free to disagree, although I discourage him from doing so, but I believe we worked well together in difficult conditions and I hope that we will have the same relationship going forward. I am confident that he will bring the same dedication to his new position that he showed in his work at the Foreign Office, although it is a difficult time to take responsibility for the middle east and north Africa. We all wish him genuine success in the role.
Although the Government may have changed, the commitment across the House to support Ukraine and starve the Russian war machine remains absolutely resolute. This motion demonstrates continuity of purpose, as it was originally laid by the Conservative Government, was interrupted by the election and has now been re-tabled by the new Minister. The Conservative Government introduced the Sanctions and Anti-Money Laundering Act in 2018, allowing us to build our own sanctions regime having left the European Union. Although our co-operative approach with the EU on sanctions is vital, particularly on Ukraine, that legislation laid the groundwork for the UK to create a world-leading and effective sanctions regime, as was demonstrated after Putin’s renewed illegal invasion of Ukraine and concerns about the territorial sovereignty of Bosnia and Herzegovina.
The UK has now sanctioned over 2,000 individuals and entities under the Russia sanctions regulations, with over 1,700 targeted since Putin launched his renewed and barbaric illegal invasion of Ukraine. Major progress has been made in cutting Russia off from global financial systems, restricting its military-industrial complex, reducing oil and gas revenues and banning items with dual military use from export to Russia.
I welcome the Minister’s statement, and welcome him to his position in the House. He brings a huge amount of experience in this field, and I know he will do a fantastic job.
Tightening economic sanctions on Russia is one of the most fundamental ways that we can help to support the people of Ukraine in their fight for democracy, and that is what I want to speak about briefly. Throughout history, conflict has been a battle of individual courage and morale—something that the people of Ukraine have demonstrated time and again over the past two years since the Russian invasion—but it has always also been a battle of technology. From the Roman legions through to the Manhattan project, the side with the better, more advanced technology often prevails, which is why it is important that our sanctions restrict Russia’s ability not just to resource its war, but to fight it in the first place.
As the saying goes, chips are the new oil. Russian semiconductor technology remains around 15 years behind that of NATO allies, but by avoiding sanctions, it is able to overcome that problem. More than two years on from its illegal invasion, Russia remains able to acquire the microchips necessary for advanced missiles and drones that are used against innocent civilians in Ukraine. Many will remember—I certainly do—that, when our sanctions were first introduced, there was talk that Russia’s economy would come to a standstill, that within months, planes would not be able to take off and Russia’s military would be unable to function. Clearly, that has not happened. We must therefore ask ourselves why and what more we can do. Today’s move to ban shadow tankers and sanction those who operate them is the right decision. It will impair Russia’s ability to finance its war by selling and transporting oil, but there is still more to be done, much of which will require ingenuity and the kind of careful diplomacy that I know the Minister is more than capable of.
There are two broad strands to the ways in which Russia is obtaining this technology. The first, and perhaps the most difficult to resolve, is by repurposing common technologies, the kinds of dual-use microchips that the hon. Member for Rutland and Stamford (Alicia Kearns) referred to. They are in washing machines or microwaves, but they are also appearing in Russian attack weaponry. For example, the Orlan-10 drone—used by Russia to target Ukrainian troops—contains some western-made components that we would normally find in weather stations, or even in dishwashers. When the Minister sums up, will he reflect on what work the Government are doing to make sure those dual-use microchips are unable to be used in that way?
Given that this change to the law seeks to tighten economic and trade restrictions on Russia, the Liberal Democrats support this statutory instrument, which has been carried on from the work of the previous Government. However, if we step back from the detail of what this SI seeks to do, it is worth looking at some of the context in which it has been tabled. Proceeds from oil and gas sales within Russia’s federal budget rose by 41% in the first half of 2024. That is partly accounted for by the fact that oil prices have gone up and the rouble has become weaker, but we cannot get away from the fact that Russia is profiting from its oil and gas sales in a way that was not the case a year ago, and is getting far greater proceeds from the sale of its oil and gas.
That matters, of course, because Russia is using that money for its grossly illegal aggression in Ukraine. It is thought that those oil and gas sales account for between a third and a half of the total Russian federal budget, so we have to ask how that is happening. Yes, it is partly happening via Russian ships that are part of this so-called shadow fleet, and it is welcome that the SI will prohibit those ships from entering a port in the UK. It is welcome that those ships can be detained in the UK and will be refused permission to appear on the UK’s ship register, but the hon. Member for Strangford (Jim Shannon) is exactly right: we also have to think about what other countries than the UK are doing. According to the Financial Times, the oil trade between India and Russia almost doubled to $65 billion in 2023. India imported very little crude oil before the invasion of Ukraine; now it is the No. 2 importer of Russian oil, after China. It is alleged that India has been refining Russian crude and re-exporting it to European nations that are otherwise seen as subject to, and complying with, our sanctions regime.
It was also interesting to hear from the hon. Member for Glasgow South (Gordon McKee) about the use of dual-use technology. It is true that Russia is seeking to become increasingly self-sufficient, while it also looks to China and India to import technology in the fields of artificial intelligence, space technology and energy technology. Earlier this year, we saw the former Russian Deputy Prime Minister Andrey Belousov, previously Minister for the Economy, become the principal Minister for Defence. We now need to move to the next stage: when we think about dual-use goods, we need to think about how to make sure we can throttle the Russian economy so that it is not importing goods that can be used for aggression in Ukraine.
Thank you, Madam Deputy Speaker. I know that tradition dictates that these speeches pay homage to our honourable predecessors, but the history of maiden speeches delivered by Members for Makerfield is somewhat chequered. My predecessor, Yvonne Fovargue, had to face down an unwelcome opponent—an unusually persistent wasp. Just as she stood up, after buzzing around her face, it struck, leaving her to struggle through the next few minutes while her face gradually swelled up.
Her predecessor, Ian McCartney, faced an even more formidable opponent: Michael Fabricant. I am told that, for decades, the parliamentary record of that encounter has stood uncorrected. As Mr McCartney began, Mr Fabricant put his feet up on the Bench. Betty Boothroyd was sat in your chair, Madam Deputy Speaker. Mr Fabricant interrupted with a point of order—not the done thing during maiden speeches, I am told. “Madam Speaker”, he said, “can you ask the man to speak in English?”, mocking Mr McCartney’s thick Scottish accent. Mr McCartney retorted, “If he doesn’t mention my accent, I won’t mention his wig.” The record does not then note Mr Fabricant’s response, “Touché, touché”, or Mr McCartney’s victorious retort, “Toupee, toupee.” Anyway, so far today there have been no wasps, and—a point that may perhaps unite this House in gratitude—no Michael Fabricant. While I do not wish to emulate those misfortunes, I hope to continue those Members’ good work in delivering for the people of Makerfield.
Many in this Chamber may not know that Makerfield is not really a place: it is a suffix attached to a collection of towns, given the name of an ancient Lancastrian forest called Macerfield that used to stretch unbroken from Wigan to Warrington. The towns I represent include Hindley Green and Hindley, Platt Bridge and Abram, Ashton and Bryn, Winstanley and Worsley Mesnes, and Orrell and Pickley Green. The history of those towns is the history of our nation. Many dug pit mines, producing the coal that powered our industrial revolution. While men dug the coal, women sorted it—pit brow lasses, as they are known. Mine workers organised into unions and, since 1906, elected Labour MPs to represent them. Industrial decline brought great destruction to many of these towns—places such as Abram, Bryn, Bickershaw and Hindley—and they will never forget the callousness with which they were treated in those years. That is one reason why I support delivering justice to mineworkers on the mineworkers’ pension scheme. Coal made this nation wealthy, and now we must ensure that those workers live with dignity in old age.
Once again, the UK has already specified ships using that enhanced power. The previous Government specified six vessels on 13 June. In July, this Government specified 11 vessels that were operating as part of Russia’s shadow fleet. That fleet attempts to undercut our sanctions, undermines the maritime rules-based order, and presents an environmental and maritime security threat to coastal states.
This statutory instrument also amends regulation 6 of the Russia sanctions regime. That regulation provides the criteria for the designation of individuals or entities for the purpose of an asset freeze and other relevant measures. Specifically, the instrument adds additional activities for which a person may be designated, including where individuals or entities provide financial services or make available funds, economic resources, goods or technology to persons involved in obtaining a benefit from, or supporting, the Government of Russia. In practice, that widens the set of actors and enablers that can be targeted for providing financial and material support to Russia and its war machine as Putin continues to prosecute his illegal war in Ukraine.
The instrument also consolidates powers under the Russia regulations to designate individuals or entities involved in the destabilisation of Ukraine. Specifically, the additional activities that the instrument adds to the designation criteria make possible the designation of persons who have owned or controlled entities involved in destabilising Ukraine, as well as individuals who work as directors or managers of such entities.
In the plainest language—because that was the language that the hon. Member for Strangford used—the instrument enables us to target the ship, as well as the individuals or entities involved with the ship. We found, through the previous regime, that the ship itself is the sharpest area of vulnerability, so the International Maritime Organisation number of the ship itself is where sanctions have greatest effect, and that is the effect that we are using today.
Briefly, on behalf of my party, I want to thank the countless civil servants, intelligence personnel and officials —some of them will be in the Box today—who work day in, day out to refine and improve our Russian sanctions regime. I know it is often difficult and hard work, long into the night. We are extremely lucky in this country to be able to rely on some of the most intelligent and hard-working sanctions officials. I am sure the Minister has already seen just how effective they are, and of course he will have long-standing friendships with some of them.
The motion addresses a key pillar of our sanctions regime: the identification and designation of Russian shipping, including ships operating under Russia’s so-called shadow fleet. The success of our sanctions regime has forced Russia to resort to expensive and complex logistical measures to source sanctioned goods and materials and export oil and gas, often via third countries, as the hon. Member for Strangford (Jim Shannon) mentioned. It is therefore imperative that we target the maritime arteries feeding the Russian war machine, and we welcome the fact that the motion will sanction a further 17 Russian vessels, including 15 from Russia’s shadow fleet. It demonstrates that, no matter how deep Russia sinks into the shadows, the UK and our partners will identify and act against Russian assets and their war machines.
The broader changes to facilitate more effective targeting of Russian shipping and of individuals aiding and abetting Russian aggression are also welcome. The Minister has our full support for those changes. Our commitment to work collaboratively and in a spirit of co-operation with the Government on the development of our Russian sanctions regime will continue, because some things, rightly, are above politics.
As I am sure the Minister is aware, two areas requiring attention are the transfer of dual-use technology to Russia from China and the kidnapping of Ukrainian children, which some say is a form of genocide. Although I understand that he cannot comment on future sanctions, I ask him to keep all options open and commit to targeting any entity, individual state or organisation providing support for Russia’s illegal and brutal war and the kidnapping of Ukrainian children.
Maintaining an effective sanctions regime requires continuous attention and effort. This instrument is an important continuation of that work, and we support the Minister’s bringing it to the House.
The other way that Putin’s military has continued to supply itself is by avoiding sanctions via third parties. The evidence is widespread: since the invasion of Ukraine, exports from the EU to some of the countries bordering Russia have increased by around 50%, roughly equivalent to three quarters of the drop in European exports to Russia since the war began. It does not take a genius to work out what is going on, especially given that the biggest growth in exports is in heavily restricted product groups such as chemicals, electronics and machinery. I know that the Minister will be keenly aware of this problem, so could he inform the House of the diplomatic work that the Foreign Office is undertaking to ensure we combat it?
I fully support the Government’s moves to tighten sanctions. Russia must never be allowed to prevail in Ukraine, and we must constrain its resources to fight this illegal war. The people of Ukraine have shown incredible bravery, courage and skill. The very least that we in this place can do is honour our commitment to them. I know the Minister will do everything in his power to help achieve that.
Backed by a Labour Government, Ian McCartney delivered the minimum wage, new health hubs in Platt Bridge and Worsley Mesnes, and investment in Abram and Winstanley. Then under the Tories, 14 years of austerity deepened the wounds of industrial decline, hollowing out public services and degrading public spaces, while wealth accumulated in London and the south-east. My predecessor, Yvonne Fovargue, worked hard to protect constituents, continuing a tradition of working closely with the fantastic Wigan council on its groundbreaking Wigan deal. She delivered a new health centre in Ashton and was a leading voice in combating debt, loan sharks and those who prey on the most financially vulnerable.
Through their ups and downs—their history is the history of this country—the towns I represent have developed one simple superpower: a community spirit that should be the envy of this land. They have pride in place, and care for friends, family and neighbours. Today, this spirit manifests in some of the wonderful community organisations I have had the privilege of getting to know. In Orrell, there is Tony, Julie, volunteers at Brighter Better Orrell, the Friends of Orrell Station, Greenslate community farm and Greenslate water meadows. In Worsley Mesnes and Winstanley, there is Joe at St Judes rugby club, Winstanley Warriors football club, and the Clifton Street community centre. In Ashton and Bryn, there is the Brian Boru club and Garswood Hall Bowling, Ashton Town FC and Ashton Athletic FC, which is currently rebuilding after a mindless arson attack. In Abram and Platt Bridge, there is David’s fantastic Wigan & Leigh Community Charity and Wigan Cosmos FC. In Hindley, there is Eric at the Hindley community allotment, the Friends of Hindley Station and the friends of Borsdane wood; and in Hindley Green, there is the Brunswick bowling club, the St John’s church and Bethel community centre, and the Hindley Green Residents Association.
What is the future for these towns and for our country? That is the question that we Labour Members must now answer. The task is immense. People I represent have lost trust in politics and in politicians. They believe that the work we do here makes little difference to them. They feel that we lecture, we speak, and we let economists, lawyers or bankers tell us the “right” answers, but that we do not listen, or respect or represent them. That is why the weight of responsibility on this Government, on me as my constituents’ representative and on all of us across this House could not be greater. Together, we must deliver for decent, fair-minded, hard-working people who love their community and their country, especially those in the former industrial heartlands of our great nation, which I am so proud to represent. We cannot and will not let these people down.
In this House, I hope to use my career to contribute on this question of the future. I spent years working on technology, data and machine learning. Too often, we talk about technology as an inexorable force, as if it bends society to its will, but it has no will. Technology is a tool. We build it, we design it and we use it in our world in ways that we choose. Now more than ever, we must have the interests of working people in mind as we harness the great potential of technology. I look forward to working with colleagues across this House who share those interests.
However, my family is what brings me more pride than anything. My parents divorced at a young age, so I grew up shifting between homes, towns and religions. I learned to see the best in people and in ways of living that could not be more different. Now I am lucky enough to see the world through the eyes of my children. I remember friends asking me before our first child was born, “How do you feel about bringing a child into this grim world?”, but to me that has it all wrong. Children are a bridge to the future. They inject hope for what our communities, our country, and we as individuals can be. That is why childcare will be a key focus of mine. We make having children too hard, too exhausting and too expensive in this country. Radically reforming childcare may be one of the most effective ways to deliver change that working people can feel, as well as boosting our workforce, and that is why I will campaign hard for that reform over the coming months and years.
Let me end by returning to something that my predecessor Mr McCartney said about the history and the future of the towns we represent. Democracy, he said, is not solely, or even primarily, about this place, or about us. It is about the efforts and endeavours of ordinary people. It endures because people have their country and their desire for freedom and fairness in their hearts. That is a profound lesson—a lesson that bears on this age even more than on his, and one that we must hold close through the challenges ahead, for we live in an age of insecurity.
As the organisation I was proud to lead, Labour Together, has argued, we must once again focus on strength, security and working with allies to navigate the choppy waters ahead. That is what we are here debating this afternoon, which is why I urge this House to support tightened sanctions on Russia. We must navigate the challenges of this age with a constant focus on working people, who are the backbone of this country, because unless working people like those I am so proud to represent feel change, and unless we in this Chamber demonstrate humility and honesty, and act with integrity and with respect, they have no reason to believe in democracy. That is the kind of representative for the people of Makerfield that I hope to be.