House of Commons
(13 years, 10 months ago)
Commons ChamberRead Full debate Read Hansard Text
Prayers
(13 years, 10 months ago)
Commons ChamberRead Full debate Read Hansard Text
This information is provided by Parallel Parliament and does not comprise part of the offical record
Hon. Members
Object.
To be considered on Thursday 24 June.
Leeds City Council Bill
Ordered,
That so much of the Lords Message [10 June] as relates to the Leeds City Council Bill be now considered.
That the promoters of the Leeds City Council Bill, which was originally introduced in this House in Session 2008–09 on 22 January 2008, may have leave to proceed with the Bill in the current Session according to the provisions of Standing Order 188B (Revival of bills).––(The Chairman of Ways and Means.)
Nottingham City Council Bill
Motion made,
That so much of the Lords Message [10 June] as relates to the Nottingham City Council Bill be now considered. ––(The Chairman of Ways and Means.)
Hon. Members
Object.
To be considered on Thursday 24 June.
Reading Borough Council Bill
Ordered,
That so much of the Lords Message [10 June] as relates to the Reading Borough Council Bill be now considered.
That the promoters of the Reading Borough Council Bill, which was originally introduced in this House in Session 2008–09 on 22 January 2008, may have leave to proceed with the Bill in the current Session according to the provisions of Standing Order 188B (Revival of bills).––(The Chairman of Ways and Means.)
Oral Answers to Questions
(13 years, 10 months ago)
Commons ChamberRead Full debate Read Hansard Text Read Debate Ministerial Extracts
Mr David Hanson (Delyn) (Lab)
1. What recent discussions he has had with business representatives on the expansion of Heathrow airport.
The Secretary of State for Transport (Mr Philip Hammond)
I have not discussed the expansion of Heathrow with business representatives since my appointment, as we have made it clear that we will not support a third runway at Heathrow. This Government’s focus is on making Heathrow better not bigger.
Mr Hanson
I welcome the Secretary of State to his position. I do not always agree with the CBI, but it has joined the Trades Union Congress and unions across London to say that the expansion of Heathrow is good for business and for London. Will the right hon. Gentleman therefore be careful that, in taking his stance—I recognise that it is one of integrity—he does not end up exporting jobs and business from London to Munich, Frankfurt and Paris?
Mr Hammond
As the right hon. Gentleman knows, both parties in the coalition campaigned before the general election on a clear commitment to scrap the third runway at Heathrow. However, we are not anti-aviation and, earlier this week, I set up a working group to consider aviation in the south-east and to work with all the stakeholders, including representatives of business, the airlines and people who work at the airport to ascertain how we can make aviation in the south-east work better within the constraints of existing runway capacity.
Angie Bray (Ealing Central and Acton) (Con)
The people of Ealing Central and Acton were delighted by the decision to scrap the third runway. Does my right hon. Friend agree that if the third runway had gone ahead, it would have imposed intolerable extra blight on those who live in west London?
Mr Hammond
My hon. Friend is absolutely right. When considering airport expansion, we must look at not only the economic benefits but the local environmental burdens and the impact on this Government’s and the previous Government’s commitments to CO2 reduction.
Jim Fitzpatrick (Poplar and Limehouse) (Lab)
I, too, welcome the Secretary of State to his new position. I also welcome his comments about undertaking a review of aviation policy in the south-east because that suggests that the economic case has not been forgotten. Does he agree that, as my right hon. Friend the Member for Delyn (Mr Hanson) said, when there is spare capacity in Paris, Schiphol and Frankfurt, and Dubai has built six runways, we run the risk of being disadvantaged not only by the rest of Europe, but by being bypassed by planes flying straight to the Americas from Asia through Dubai?
Mr Hammond
Heathrow is Britain’s premier hub airport and we intend to ensure that it remains a major hub airport. We want to work with business and other stakeholders to ensure that Heathrow becomes better, not bigger, and that we protect its status.
Mr John Whittingdale (Maldon) (Con)
2. If he will take steps to reduce congestion at the Dartford crossing.
The Parliamentary Under-Secretary of State for Transport (Mike Penning)
The Department and the Highways Agency are committed to improving the levels of service experienced by users of the Dartford crossing. The Highways Agency and I will consider a package of measures, including better information and traffic management to help reduce the congestion at the Dartford crossing.
Mr Whittingdale
I thank my hon. Friend for that answer, but is he aware that, since the tolls increased, the delays when approaching the tolling booths are anything up to 45 minutes and more? That causes enormous frustration to those who use the crossing, which is increased by the fact that the original intention was to scrap the tolls once the bridge was paid for rather than to put them up.
Mike Penning
My hon. Friend knows that I am personally aware of the problems at the Dartford crossing, having used it for many years. The £40 million net that we recover from the crossing is a significant income, but we need to consider technology that is being used in other parts of the world, particularly in Australia, so that we can remove the barriers and increase the speed at which traffic comes through while also picking up the revenue that the country desperately needs.
Caroline Lucas (Brighton, Pavilion) (Green)
3. What information his Department holds on the effect of industrial action involving airlines on the number of passengers on flights operated by those airlines.
The Minister of State, Department for Transport (Mrs Theresa Villiers)
The Department does not routinely monitor or hold information on airline passenger loads. However, most publicly listed UK airlines, including British Airways, regularly publish traffic and capacity statistics.
Caroline Lucas
Is the right hon. Lady aware of testimony from British Airways staff that British Airways has run commercially unviable flights in periods of industrial action, with low to zero numbers of passengers, to give the impression that it is unaffected by industrial action? Will you condemn any carrier for such environmentally unsustainable behaviour and investigate any report from BA staff?
Mrs Villiers
It is clear that this Government are determined to provide encouragement to airlines to fly greener planes and to switch to flying fuller planes. That is what is behind the proposals we will make on reforming air passenger duty, and it will help to address the concerns around so-called ghost flights.
Turning to the hon. Lady’s specific example, that is primarily a matter for British Airways. I understand from the airline that some planes flew with low passenger loads, some were freight-only, and some had only crew on board, to ensure that the aeroplanes were in the right place to resume passenger operations once the dispute ended. That is a concern to us because of the environmental impact of empty flights. Unfortunately, that is another negative consequence of the industrial dispute and another reason why I urge the parties to get back round the table to ensure that it is resolved as soon as possible to prevent a recurrence.
Clive Efford (Eltham) (Lab)
4. What plans he has for the future of the national concessionary bus fare scheme.
The Parliamentary Under-Secretary of State for Transport (Norman Baker)
The Government’s commitment to protect free bus travel for older people is set out in the coalition agreement. The right to free bus travel for both older and disabled people is enshrined in primary legislation.
Clive Efford
Will the hon. Gentleman be the Government’s conscience on the freedom pass, because when one looks at all the people who have tried to undermine it in the past, one realises that they have all been Conservatives. They have described the pass as a stealth tax, or said that it goes to the wrong people. Would it be a resigning issue for him if the scheme were to be watered down in any way, and will he keep a weather eye out for those nasty colleagues of his who always try to undermine the freedom pass?
Norman Baker
It is something of a record to ask a Minister whether he might consider resigning when he is answering his first departmental question. I am happy to assure the hon. Gentleman that the coalition—both parties—are committed to free bus travel for older people, as I set out. Indeed, that is enshrined in primary legislation, so I think that his fears are groundless.
Bob Blackman (Harrow East) (Con)
The Labour Government reduced the grant for the bus concessionary scheme in London by some £25 million quite late on in the process. Will the Minister confirm that the coalition will not do anything similar to the council tax payers of London?
Mr William Bain (Glasgow North East) (Lab)
I welcome the Minister and his colleagues to their appointments, and we wish them well in their responsibilities. It is hard not to notice that the Department is led by two former shadow Chief Secretaries to the Treasury, at least one of whom would rather like to be Chief Secretary to the Treasury, so the Opposition will be keeping a very careful eye on them to ensure that they are genuine advocates for modern transport infrastructure, and not holding office simply to wield the Chancellor’s axe.
Will the Minister give the House a clear guarantee on two points on the concessionary travel scheme? Can he reassure the 11 million people who were given free bus travel under Labour that this Government will not introduce any new restrictions on when and how their passes can be used, and can he guarantee that there will be no means-testing for new recipients of free bus travel during the lifetime of this Parliament?
Norman Baker
The Opposition spokesman perhaps did not hear my original answer, which was that the Government are committed to protecting free bus travel for older people. That is set out very clearly in the coalition agreement and will be our policy.
Mr Adrian Sanders (Torbay) (LD)
5. What recent representations he has received on the system of reimbursement to local authorities for their expenditure on the national concessionary bus fare scheme; and if he will make a statement.
The Parliamentary Under-Secretary of State for Transport (Norman Baker)
Department for Transport Ministers have recently received general representations about concessionary travel, including from local authority and bus operator representatives. Some of those representations have included funding issues.
Mr Sanders
I welcome my hon. Friend to his position. He will be aware that many councils have found it difficult to meet the full costs of the scheme. I successfully lobbied for extra money for my authority, but it is still out of pocket. While lobbying, I uncovered a report that suggested that significant savings could be made if the scheme were administered nationally, with the Government rather than lots of local authorities negotiating with the bus companies. Will he look at that idea to see whether savings can be made?
Norman Baker
The previous Government consulted on that very option, and only 23% of respondents were in favour of it, compared with a majority in favour of administration at county council level—the scheme that has now been adopted. The concern is that if the scheme were administered centrally, it might have an impact on the discretionary concessions offered by district councils. We could end up with a national system and local negotiations, thereby increasing administration costs.
Michael Connarty (Linlithgow and East Falkirk) (Lab)
The Minister will be aware that the decision to have a concessionary scheme in England had consequential effects on funding in Scotland through the Barnett formula. The scheme is already underfunded by the Scottish Government, so may I have an assurance that there will be no further cuts in funding in Scotland through the effect on the Barnett formula?
Norman Baker
I am happy to say that I am not an expert on the Barnett formula, and I advise the hon. Gentleman to await the outcome of the spending review.
Andrew George (St Ives) (LD)
6. What assessment has been made of the effects on front-line transport services of the announced expenditure reductions for his Department in 2010-11.
The Secretary of State for Transport (Mr Philip Hammond)
I can reassure my hon. Friend that this Government take protecting front-line services very seriously. However, we also take very seriously the need to deal with the unsustainable structural deficit we inherited. The Department for Transport is focusing on making its contribution to deficit reduction while supporting economic recovery and protecting priority areas.
Andrew George
Notwithstanding that answer, is the Secretary of State aware that the suspension of major schemes has meant that the Maritime and Coastguard Agency may not provide the Isles of Scilly ferry service with the necessary authority to continue? As the service has been 10 years in preparation, is 99% ready to go and is a lifeline for the Isles of Scilly, will he reconsider this issue?
Mr Hammond
Perhaps I can clarify what I have done. This scheme has conditional approval, and we have said that schemes with conditional approval or programme entry will have to await the outcome of the spending review before we can confirm them. My understanding is that Cornwall county council is still awaiting listed building consent, without which the scheme could not proceed anyway, but we are aware of the vital nature of the link to the Isles of Scilly and we will review the scheme as soon as the spending review has been completed.
Mrs Louise Ellman (Liverpool, Riverside) (Lab/Co-op)
I congratulate the right hon. Gentleman on his appointment.
Two days ago in the other place, Lord Attlee stated that rail electrification could not be afforded. Does that mean that the Government reject the notion that investment in transport is essential to support economic recovery?
Mr Hammond
The Government are committed to rail electrification because of its carbon impact. However, as the hon. Lady will be aware, we have inherited a massive black hole in the public finances—[Interruption.] Labour Members can laugh, but the previous Government announced a halving of the public capital investment programme without giving any indication of where that cut would come. After the spending review, we will have to look at all these programmes in the light of their affordability and the urgent need to reduce the fiscal deficit.
Mr Rob Wilson (Reading East) (Con)
Will my right hon. Friend meet me and a delegation from Reading borough council to discuss the continued funding of proposed transport changes that his announcement last week suggested might be suspended?
Mr Hammond
The only announcement that I made last week that affects the Reading scheme was about a local authority scheme for highway improvements around Reading station. That scheme will be reviewed following the outcome of the spending review, and my hon. Friend will learn the outcome in due course.
Sadiq Khan (Tooting) (Lab)
May I genuinely welcome and congratulate the Secretary of State and the ministerial team on their new jobs? Good transport can be a driver of economic growth and I ask the Secretary of State to be a champion for transport, rather than treat his position as an application for his next job.
The Secretary of State will be aware that the rail network is carrying more passengers and more freight than at any time since the 1940s, and projections predict further growth. That is why we promised an additional 1,300 carriages by 2014 and we were well ahead of schedule in providing those. In fact, at the last Transport questions, both Liberal Democrats and Conservatives asked us to provide more carriages even more quickly. Now that they are in government together, can the Secretary of State tell us how many more carriages than 1,300 they will provide and how much sooner than 2014?
Mr Hammond
I am genuinely grateful to the right hon. Gentleman for his congratulations.
The Department’s principal task is to support economic growth and the Government’s 2020 carbon reduction targets, and we have to demonstrate that we can deliver them in tandem. Approximately half the HLOS––high-level output specification––rolling stock has already been contracted and will proceed, but no further contracts will be signed during this financial year owing to the disastrous public finances. When the spending review is completed, we will review where we are with the programme and make a further announcement in due course.
Sadiq Khan
One would have thought that if the Secretary of State was serious about moving people from road to rail, he would encourage more carriages, so that people would be encouraged in turn to use the rail system. He will be aware that the Under-Secretary of State for Transport, the hon. Member for Lewes (Norman Baker) is a passionate advocate of reform of rail fares; in fact, in his last question at a Prime Minister’s questions, he challenged the then Prime Minister to change the rail fares formula to 1% below inflation. I am sure that he remains a passionate advocate and is not simply window dressing, so now that they are hon. Friends, will the Secretary of State confirm how soon he will announce a change in the rail fare regime and how much below inflation it will be?
Mr Hammond
It is amazing that the right hon. Gentleman, who was a member of the last Government, appears to come to the Dispatch Box with no recognition of the deficit we are facing and the financial challenges that the Government have to deal with in order to clear up the mess that he and his hon. Friends left behind. We are committed to fair rail fares, but we have to do everything within the context of the fiscal inheritance that we have received.
Alec Shelbrooke (Elmet and Rothwell) (Con)
I urge my right hon. Friend, when considering how best to expand rail, to consider branch lines off high-speed rail links to service some of the commuter towns disfranchised under the Beeching review.
Mr Hammond
Although we want to continue to increase passenger usage of the railways, we have to operate within a tightly constrained public spending environment. Our first priority must be to maintain and improve the trunk railway network that we have already. I will consider any proposals for reopening branch lines, but I have grave doubts about whether it is likely to be affordable in the foreseeable future.
Mr Speaker
Order. I gently point out that we need to make better progress, so short questions and short answers would be appreciated.
Kevin Brennan (Cardiff West) (Lab)
7. What plans he has for the electrification of the mainline railway between Wales and London.
The Minister of State, Department for Transport (Mrs Theresa Villiers)
We support rail electrification because it helps to reduce carbon emissions and cut running costs. However, we are in the early stages of the new Government and Ministers are considering the full range of transport policy to ascertain what is affordable.
Kevin Brennan
I welcome the Minister to her post and thank her for her answer. In considering those matters, does she understand the importance of electrification on the line between Wales and London? I am glad that she did not simply repeat the mantra of her right hon. Friend, which is becoming as boring as a vuvuzela at the World cup—the one-note symphony we are getting from the Government. However, does she understand the importance of this kind of infrastructure? It is not just about the budget deficit, but about the future growth of the economy.
Mrs Villiers
I understand the importance of this issue, including in Wales, but the previous Government, of which the hon. Gentleman was a member, had 13 years to do this and failed. Just a few short years ago, the 30-year strategy they published for the railways had virtually no place for electrification. Then we had a last-minute change of mind, made at a point in the cycle when, as Labour’s outgoing Chief Secretary made clear, there was very little money left. We support electrification—it was in our manifesto and the coalition agreement—and we will take forward those projects that are affordable in the light of the deficit left to us by the Government of which the hon. Gentleman was a member.
Robert Halfon (Harlow) (Con)
8. What priorities he has set for departmental expenditure on the road network.
The Secretary of State for Transport (Mr Philip Hammond)
I welcome my hon. Friend to his place. He worked long and hard to win his seat and he thoroughly deserves the success that he has now enjoyed.
The first priority of this Government must be tackling the country’s unsustainable level of debt. Once the spending review is complete and the Department has settled its budget, we will review all existing schemes, whether road or otherwise, on the basis of the economic benefits that they deliver.
Robert Halfon
Is the Secretary of State aware that Harlow has just one entrance to a motorway, whereas similar towns, such as Welwyn Garden City, have two or three and Basildon has four? Is he aware that traffic in Harlow is gridlocked and that residents in my constituency are crying out for an extra junction on the M11? With the road review under way, and when finances allow, will he give strong consideration to providing the road infrastructure that Harlow so desperately needs?
Mr Speaker
Order. I do apologise, but the questions are still too long. We are getting mini-essays. I want short questions.
Mr Hammond
I can tell my hon. Friend that we will be happy to consider proposals from local authorities and the Highways Agency for improvements, but he will understand that they will be affordable only once the deficit has been eliminated.
Derek Twigg (Halton) (Lab)
A few moments ago, the Secretary of State said that one of the key priorities was supporting economic growth. How does suspending the decision on the Mersey Gateway project help economic growth in Merseyside and Cheshire, particularly given the support from the Conservative councils in Cheshire? And he should not give us that nonsense about a black hole in the finances.
Mr Hammond
If the hon. Gentleman thinks that the black hole in the finances is nonsense, he needs to go back and do a little more homework. It is the most serious problem facing our country today and the most urgent challenge for this Government. However, let us be clear about the Mersey Gateway project. All we have done is suspend the progress of the scheme until after the current spending review is completed. We believe that it would be wrong to encourage or allow local authorities to incur significant additional expenditure on a large number of projects when some of them clearly may not be able to proceed on the original timetable.
Sir Alan Beith (Berwick-upon-Tweed) (LD)
Is my right hon. Friend going to treat the A1 as a national strategic road, rather than a regional road, and develop plans for full dualling of it when resources allow?
Joan Ruddock (Lewisham, Deptford) (Lab)
9. Whether his Department’s value for money evaluation of the proposed Surrey Canal Road station on the East London line extension has been completed.
The Minister of State, Department for Transport (Mrs Theresa Villiers)
We recognise the importance of Heathrow as the country’s international hub airport—
Mr Speaker
Order. I think that the Minister has the wrong brief. I may be mistaken—if I am wrong, I apologise to her—but she is answering a question about the Surrey Canal Road station on the East London line. That is what is of interest to the right hon. Member for Lewisham, Deptford (Joan Ruddock).
Mrs Villiers
I apologise, Mr Speaker.
A value for money assessment of the proposed Surrey Canal Road station was carried out by Transport for London and Lewisham council last year. The Department for Transport has some concerns regarding the business case. I have asked officials to provide full advice on the matter and expect to make a decision in the near future.
Joan Ruddock
I welcome the right hon. Lady to her position, and I am grateful for that reply. However, she needs to remember that Transport for London has found that the proposal more than meets the business case that was applicable to all other stations in London, and that it is pivotal to the development of 2,500 new homes and to the job prospects of the 2.9 million people expected to use the station. Will she meet with me to see how to get the station built now, alongside the construction of the railway?
Mrs Villiers
I am happy to meet the right hon. Lady as soon as possible to discuss this important issue. She has fought hard on the campaign, and I am looking into the proposal with great care. I am discussing it with officials and, as I have said, I have asked them for extra briefing. It is important to take into account local views, TfL’s views and the views of other stakeholders. However, I must also make it clear that we need to assess such programmes carefully for affordability, given the state of the public finances and the deficit that we have inherited from Labour.
Simon Hughes (Bermondsey and Old Southwark) (LD)
Does the Minister accept that this issue has a cross-borough and cross-constituency resonance, and that there is widespread support for the proposal across the parties? Will she meet all of us who have an interest in it? I hope that we shall be able to persuade her of its merits, because we have a very good case.
Chi Onwurah (Newcastle upon Tyne Central) (Lab)
10. What guidance his Department issues to local authorities on the provision of subsidised bus services.
The Parliamentary Under-Secretary of State for Transport (Norman Baker)
In 2005, the Department published a document on its website detailing best practice in the process of tendering for subsidised bus services, along with examples of specimen conditions for contracts, as part of its wider guidance to local authorities. The guidance remains available, and there are currently no plans to update it. The Department’s website also provides guidance on the de minimis rules for tendering.
Chi Onwurah
It was Baroness Thatcher who said that if a man finds himself on a bus at the age of 26, he is a failure. I assure the Minister that that is not the case in Newcastle, where the buses are an essential part of our economy. They are how we get to work. Will he assure us that, under the coalition Government, local authorities will have the powers to ensure that we have excellent bus services?
Norman Baker
We recognise that bus travel is the predominant form of public transport, and we want to encourage that. We also want to get better value for the taxpayer and the fare payer from the bus services that are provided. We also recognise the good work that many local authorities do in dealing with bus services, and I particularly want to pay tribute to the Tyne and Wear integrated transport authority, which is designing a comprehensive bus network to improve standards of accessibility for local residents.
Sadiq Khan (Tooting) (Lab)
I welcome the Minister to his new role; I am sure that he will do an excellent job. We heard earlier that he had been unsuccessful in persuading his colleagues to change their views on carriages and rail fares. Has he had any more luck in changing their views on quality bus contracts? He will be aware that local authorities outside London want the same powers as those in London to choose to enter into quality bus contracts with bus operators. Local authorities around the country, led by all parties, are in favour of that, and so was the Minister before the election. Is he still in favour of it, and, if so, has he persuaded his colleagues to change their minds?
Norman Baker
I thank the right hon. Gentleman for his kind welcome. He was always considerate and helpful to me when I was in opposition, and I shall try to be equally helpful to him, now that the position has changed.
The legislation on quality contracts is as it is; it was set out and passed under the previous Government, and it remains in place. The Competition Commission is undertaking an investigation into the bus market, and it would be premature for me to make any further comments until it is completed.
Andrew Gwynne (Denton and Reddish) (Lab)
11. What assessment he has made of the merits of the 3a and 3b extensions to the Manchester Metrolink; and if he will make a statement.
The Parliamentary Under-Secretary of State for Transport (Norman Baker)
Phases 3a and 3b of the Manchester Metrolink were approved for funding by the previous Government. Construction of phase 3a is under way. Phase 3b has been re-examined following the announcement by the Chief Secretary to the Treasury on 17 May of a review of spending approval granted since 1 January this year.
Andrew Gwynne
With regard to the phase 3b contract for the Ashton-under-Lyne extension, it is important to note that substantial amounts of public funding have already been spent on the route, and significant advance works to provide dedicated strengthened central reserves and bridges have now been completed. Studies show that the East Manchester line will be commercially viable only if it goes all the way through to Ashton. Will the Minister confirm that all those issues will be factored into the review and that they will be carefully considered before a decision is made?
Norman Baker
The hon. Gentleman makes a number of pertinent points, and I understand the thrust of his argument and the strength of his case. I cannot give him a specific assurance at this precise moment, but I suggest that he will be interested to hear the statement that is shortly to be made from the Treasury Bench.
Gareth Johnson (Dartford) (Con)
12. What his plans are for the future funding of new fixed speed cameras; and if he will make a statement.
Richard Harrington (Watford) (Con)
15. What his Department’s plans are for the future funding of fixed speed cameras; and if he will make a statement.
The Parliamentary Under-Secretary of State for Transport (Mike Penning)
With permission, Mr Speaker, I will answer questions 12 and 15 together. The Government will not provide—
Mr Speaker
Order. I am happy to allow the questions to be taken together, but this is the first that I have heard of it. The normal courtesy is that the Government notify me of this in advance. I shall let the Minister off on this occasion, but I do not want to see a repeat performance.
Mike Penning
I had been informed that these questions had been grouped, and I apologise to you if I was impertinent, Mr Speaker.
The Government will not provide any more money to local authorities for new fixed speed cameras. If authorities want to put up new fixed cameras, they are free to do so using their own resources, but we strongly encourage them to use other methods and effective safety measures.
Gareth Johnson
I am grateful for that reassurance. Does the Minister agree that when speed cameras are used more as a money-raising mechanism than as a road-safety measure, confidence in them will continue to fall?
Mike Penning
There are now three times as many speed cameras in this country as there were in 2000, and the public must be confident that speed cameras are there for road safety, not as a cash cow. Under this Government, they will be.
Mr Speaker
I call Richard Harrington. It appears that not only was I unaware of the grouping of questions 12 and 15, but the hon. Member for Watford (Richard Harrington), whom the grouping directly affects, was also unaware of it, as he is not present.
Jim Fitzpatrick (Poplar and Limehouse) (Lab)
Does the Minister not accept that the very good progress made in recent years in reducing the number of deaths and injuries on our roads is partly due to speed cameras, and that the income generated has been less than the money spent by the Government on speed cameras? Will he consider the introduction of more average-time distance speed cameras and making the existing speed cameras less conspicuous?
Mike Penning
The hon. Gentleman, a Minister in the previous Government and a former firefighter, is well aware of how speed cameras can protect the public. As a former firefighter myself, I know that speed has been part of the reason for many road traffic accidents, but not the sole reason for them. The growth of speed cameras has been so great that the public are concerned about whether they are there for safety or to raise money for the Treasury. The Government will not put any more money in; if local authorities want to do so, that is okay. Intermittent and average speed cameras are in use, particularly on motorways, and are an excellent way of easing congestion on our motorways.
Fiona Mactaggart (Slough) (Lab)
T1. If he will make a statement on his departmental responsibilities.
The Secretary of State for Transport (Mr Philip Hammond)
The Government’s first priority is reducing the budget deficit left us by the previous Administration, and I am determined that the Department for Transport should play its full part in that process. Against that backdrop, my Department is focused on building a modern and sustainable transport system that will contribute both to future economic growth and to the achievement of the Government’s climate change targets.
Fiona Mactaggart
When does the Secretary of State expect to receive Lord Mawhinney’s report on Heathrow high-speed rail access? When he receives it, will he consult Slough, whose prosperity depends completely on its proximity to Heathrow?
Mr Hammond
I have asked Lord Mawhinney to let us have his preliminary conclusions by the end of July, and I will be happy to consult the hon. Lady’s local authority once I have received that report from him.
Simon Hughes (Bermondsey and Old Southwark) (LD)
T3. As Ministers work out how best to transfer travel from plane to train, where that is possible, will they prioritise talks with European colleagues to make sure that the European rail network works and with colleagues in this country to make sure that high-speed rail will allow people to go through the capital without having to change trains?
Mr Hammond
I thank my hon. Friend, who makes a very important point. Now that we have made it clear that there will be no third runway at Heathrow airport, modal shift from air to rail becomes crucially important, including for journeys through to Europe. I have asked HS2 Ltd to look at the options and the costs of providing a direct link from the proposed HS2 to the existing high-speed rail network to the Channel tunnel.
Mr Stephen Hepburn (Jarrow) (Lab)
T2. I cannot stress enough the importance of the Tyne and Wear metro to the people of the north-east—in respect of the economy, the environment and the general quality of life. The previous Government pledged £350 million to upgrade the scheme, so will the Minister acknowledge the importance of the Tyne and Wear metro and tell us whether he is going to honour that pledge?
The Parliamentary Under-Secretary of State for Transport (Norman Baker)
I do acknowledge the importance of the Tyne and Wear metro, just as I acknowledge the difficult financial position the Government are in. I suggest that the hon. Gentleman wait for the Treasury statement later this morning.
Gavin Barwell (Croydon Central) (Con)
My constituents do not want the pollution that additional runways at Heathrow, Stansted and Gatwick would entail, but they do want shorter queues, fewer delays and better service. Does my right hon. Friend agree that there are plenty of ways of achieving that through improving operations at those airports?
The Minister of State, Department for Transport (Mrs Theresa Villiers)
I very much agree with my hon. Friend. That is why the Secretary of State has established a taskforce to look into the ways we can make good on our promise to make Heathrow better. We have rejected a third runway because of the huge environmental damage it would cause, but there is more we can do to improve the regulatory structure and we are bringing forward legislation on that to incentivise the airports to focus on the quality of service for passengers. We need to keep security measures under review so that passengers are kept safe and we can mitigate the hassle that those measures cause. We need to work with the stakeholders and the airlines to get the right solution to integrate high-speed rail with Heathrow, to provide a viable alternative to having many short-haul flights and to relieve overcrowding problems at the airport.
John Robertson (Glasgow North West) (Lab)
T5. What is happening about the sell-off of BAA, its monopoly—particularly north of the border—and the imposition on passengers, especially in Glasgow, of charges for being picked up after their holiday flights, and the requirement to walk for an exorbitant distance? It is an absolute disgrace, and it is time that such companies were brought to book and made to compete.
Mrs Villiers
The hon. Gentleman is right to draw attention to a consumer issue which, I know, greatly concerns his constituents and many other users of that airport. It is just the type of issue that we hope our new airport regulation Bill will address. We intend to give airports stronger incentives to look after and respond to their customers.
The proceedings of the Competition Commission in relation to the ownership of various airports around the country are a matter for the commission, but we have often highlighted the benefits that diversity of ownership in the United Kingdom airport sector can yield to customers.
Iain Stewart (Milton Keynes South) (Con)
Is the Minister aware that Arriva buses recently introduced a completely new network and timetable in Milton Keynes? At a public meeting last Friday many of my constituents, especially pensioners, told me that they had been greatly inconvenienced by the changes, and that they had not been properly consulted. Will the Minister do all that he can to ensure that operators consult their passengers properly before introducing such radical changes?
Norman Baker
My hon. Friend makes a good point. We ought to ensure that bus companies work with the grain of local people’s interests. We are considering the period within which bus companies must give notification of new timetables.
Catherine McKinnell (Newcastle upon Tyne North) (Lab)
Will the Minister reassure us that in considering any spending review relating to funds for the Tyne and Wear metro, he will take account of the need to preserve an existing structure which—unlike many other capital projects—is more than 30 years old, desperately requires reinvigoration, and is vital to the community in Newcastle and throughout the north-east?
Norman Baker
As I said a moment ago to the hon. Member for Jarrow (Mr Hepburn), we understand the importance of the Tyne and Wear metro to the area. I suggest that the hon. Lady wait for the statement that the Chief Secretary to the Treasury will make later this morning.
Mr John Leech (Manchester, Withington) (LD)
May I urge the Secretary of State to accept the recommendations of the North review and, as a matter of urgency, present proposals for a reduction in the drink-drive limit from 80 to 50 mg?
Mr Philip Hammond
Sir Peter North has delivered a comprehensive report, containing 51 recommendations, on issues relating to driving under the influence of drink or drugs. The Government will consult other Departments on the implications of the recommendations, and we will announce our position in due course.
Hugh Bayley (York Central) (Lab)
In April, when Jarvis was placed in administration, Network Rail cancelled millions of pounds of track renewal contracts on the east coast main line. We have recently been reminded of the Potters Bar rail accident. That track renewal work must go ahead. Will the Minister arrange for me to meet Iain Coucher—along with Members representing other constituencies where many workers have been made redundant as a result of the cuts—so that we can discuss with him the timetable for reinstating the track renewal contracts with other companies?
Mr Hammond
The Office of Rail Regulation is responsible for ensuring that the railway is managed safely, and that works that are required for its safety go ahead. The hon. Gentleman may not be aware that shortly before Question Time, Network Rail announced that Iain Coucher would be stepping down from his role. For that reason it would not be practical for me to arrange a meeting with him, but I should be happy to try to facilitate a meeting with another appropriate representative of Network Rail.
Zac Goldsmith (Richmond Park) (Con)
Will the Secretary of State confirm that he will protect runway alternation at Heathrow?
Mrs Villiers
I can give that confirmation. We support the current protections of runway alternation. We defeated Labour’s proposals for mixed mode when we were in opposition, and we will not revive them now that we are in government.
Mr Tom Watson (West Bromwich East) (Lab)
Does the new, post-bureaucratic age of transparency extend to a commitment to publish bus and rail timetables in digital format for open public reuse?
Mrs Villiers
We are looking at that issue at the moment. I think there are considerable benefits to be gained from a more open approach to timetabling, and I would be delighted to have a discussion with the hon. Gentleman if he wants to give me further indications of his ideas on this, so that we can ensure we get the maximum benefits for passengers.
Mr Philip Hollobone (Kettering) (Con)
Vehicle excise duty remains unpaid on 2 million vehicles, 80% of which are uninsured and 70% of which are owned by people with criminal convictions. Given that these vehicles kill 160 people a year and injure 23,000, may we have a crackdown?
The Parliamentary Under-Secretary of State for Transport (Mike Penning)
My hon. Friend raises a very important point, but vehicle recognition technology is now moving forward. I have recently been in police vehicles where we have been able to pick up where other vehicles have not had MOTs and insurance, and I am asking the Association of Chief Police Officers lead on this, whom I met yesterday, to clamp down as hard as possible.
Mary Creagh (Wakefield) (Lab)
Brake, the road safety charity, has said that cutting Government funding for speed cameras will lead to blood on our roads. Why is the Minister cutting the funding for them, given that they would raise revenue during the forthcoming age of austerity, and how is Wakefield council supposed to put new ones in when it has just had a £1 million cut to its road safety grant?
Mike Penning
Local authorities have the powers to spend the money as they wish, and if they wish to spend it on more speed cameras that is entirely within their remit. There are other ways in which lives can be saved. I have looked at what Brake says, but I disagree. Such cameras should not be a cash cow. This should not be determined by issues to do with raising tax. It should be about safety; that is the important thing.
Andrea Leadsom (South Northamptonshire) (Con)
May I welcome my right hon. Friend the Secretary of State to his new position? Does he agree with me in principle that those people whose homes have been blighted by Labour’s preferred route for high-speed rail should be fully compensated, rather than at the 85% of value as proposed by Labour?
Mr Philip Hammond
I am grateful to my hon. Friend for her question. One of the first decisions I took in my new post was to extend the consultation on the exceptional hardship scheme. That consultation closes today and we will publish our conclusions in due course.
Emma Reynolds (Wolverhampton North East) (Lab)
1. What discussions she has had with the Deputy Prime Minister on constitutional reforms to increase the representation of women and ethnic minorities in Parliament.
The Secretary of State for the Home Department and Minister for Women and Equalities (Mrs Theresa May)
With permission, Mr Speaker, I wish to notify the House that, given the cross-cutting nature of the women and equalities agenda, I may be joined on the Front Bench for future questions not only by the Minister for Equalities, but also by the Minister with responsibility for race equality, the Under-Secretary of State for Communities and Local Government, the hon. Member for Hazel Grove (Andrew Stunell), who is present in the Chamber today, and by the Minister with responsibility for disabled people, the Under-Secretary of State for Work and Pensions, my hon. Friend the Member for Basingstoke (Maria Miller) and the Minister with responsibility for pensions, the Minister of State, Department for Work and Pensions, the hon. Member for Thornbury and Yate (Steve Webb), in order to allow Members to receive answers from the Minister with responsibility for the issue under discussion so that we can look at the wider equalities agenda.
On the question, I welcome the hon. Member for Wolverhampton North East (Emma Reynolds) to the House, and I am pleased to say that following the recent general election there are now more women and black and minority ethnic Members of Parliament in the House. I am particularly delighted that across the governing parties there are now 56 women MPs and 11 MPs from an ethnic minority background, but we do need to do more, and I will be talking to the Deputy Prime Minister to ensure that this issue is a matter of concern when we look at our constitutional reform agenda.
Emma Reynolds
I am proud to be one of the 81 Labour women MPs in the House, and it is clear that my party has done more than any other to increase the representation of women and ethnic minorities in this House, but progress is far too slow still. As part of the apparently far-reaching constitutional reform package, what will the Government do to make sure this House reflects the people we serve?
Mrs May
As my right hon. Friend the Deputy Prime Minister made clear in his speech of 19 May, our agenda for constitutional and political reform will be a power revolution because it will be a fundamental resettlement of the relationship between the state and the citizen, but it would be a mistake for anybody to assume that constitutional reform in itself can bring about an increased diversity of representation in this House. The first responsibility for ensuring diversity of representation rests with political parties, and with political parties taking action to ensure we have a greater diversity of candidates, and I am very proud to have been involved in the action that the Conservative party took to ensure we have a much greater diversity of Members of Parliament on our Benches.
Jo Swinson (East Dunbartonshire) (LD)
The Minister is absolutely right to say that constitutional reform is not the only way to improve representation within this House. Many suggestions were put forward in the excellent Speaker’s Conference report, which this House considered in the last Parliament, such as a democracy diversity fund to help candidates to stand for election where there might otherwise be barriers, and reforms to this House. Will she be taking forward some of the recommendations in the Speaker’s Conference report?
Mrs May
I am grateful to my hon. Friend for her question and I pay tribute to her for the role that she played in the Speaker’s Conference and to the work that was done by the Speaker’s Conference. As she will be aware, the last Government responded to the report and we responded to it when we were in opposition. We will now consider how to take forward some of the proposals made by the Speaker’s Conference—[Interruption.] Opposition Members should have a little patience. They are shouting “What?” and I am just about to tell them, if they wait. We have made an early commitment as part of our coalition agreement to introduce extra support, particularly for disabled people who want to become MPs, councillors or other elected representatives.
Keith Vaz (Leicester East) (Lab)
The Home Secretary is absolutely right that there are now more Members from ethnic minorities in the House of Commons—26—than at any time in the history of this country. Sadly, the only party that does not have any ethnic minority MPs is, of course, the Liberal Democrats. The leader of the Liberal Democrats supported my private Member’s Bill to allow all-ethnic minority shortlists. Would the Home Secretary support that Bill if I was to introduce it to the House? She is right—it is up to the political parties to make the changes.
Mrs May
In a sense, I think that the right hon. Gentleman has slightly contradicted himself by suggesting that legislation is the way forward rather than the encouragement of political parties. I am pleased that as part of the 26, we have 11 Conservative Members of Parliament from black and minority ethnic backgrounds, which is a significant increase at the last election. It is right that all political parties need to do more on this issue and that all political parties need to consider the processes that they are using to select their candidates. There is a role for us all in trying to go out there to ensure that people in black and minority ethnic communities see this place as somewhere that is for them, so that they want to come and represent constituencies in this House. That is a job that we can all do.
Julian Smith (Skipton and Ripon) (Con)
2. What recent discussions she has had on plans to reform arrangements for parental leave; and if she will make a statement.
The Secretary of State for the Home Department and Minister for Women and Equalities (Mrs Theresa May)
I have had several discussions with Cabinet colleagues and these will continue. We are committed to encouraging the involvement of both parents from the earliest stages of pregnancy, including the promotion of a system of flexible parental leave. Indeed, as we speak my right hon. Friend the Deputy Prime Minister is making a speech on families and family policy in which he will confirm this commitment.
Julian Smith
May I urge my right hon. Friend to consider the needs of and challenges faced by small business employers as well as employees as she develops this legislation?
Mrs May
I can confirm that we will do that. I am conscious that it is important that we ensure that business is consulted when we are introducing such changes to ensure that we can introduce them in as bureaucratically and administratively light a way as possible so that the impact on small businesses is not too great. My right hon. Friend the Deputy Prime Minister will announce this morning that the childhood and families taskforce that he is setting up will consider this matter and consult on how to put it into place.
Mr Denis MacShane (Rotherham) (Lab)
Has the Home Secretary had a chance to read the Prime Minister’s excellent article in the Financial Times in which he says that the priority for Europe must be full equality in the workplace? I welcome that. Is the Cabinet a workplace, and when will half of it consist of women?
Mrs May
That was a somewhat disappointing question from the right hon. Gentleman. As he will know, the proportion of women who are full members of the Cabinet under the coalition Government is exactly the same as the proportion of women who were full members of the Cabinet under the Labour Government.
Mr Marcus Jones (Nuneaton) (Con)
3. What steps the Government are taking to tackle violence against women.
Andrew Stephenson (Pendle) (Con)
6. What steps the Government are taking to tackle violence against women.
The Minister for Equalities (Lynne Featherstone)
I welcome the hon. Member for Nuneaton (Mr Jones) to his place. Violence against women and girls remains prevalent in our society. This is unacceptable and a cross-Government strategy is the best way to address this. I look forward to discussing with colleagues across Government how we will take forward our approach in this area.
Mr Jones
I thank the Minister for that answer. During the previous football World cup in 2006, there was a 30% rise in domestic violence on the days that England played. What assurances can my hon. Friend provide the House that women will be protected, especially during the current tournament?
Lynne Featherstone
The Home Secretary recently stated that such violence is not acceptable under any circumstances, and even the World cup does not give perpetrators the slightest excuse to be violent. The Association of Chief Police Officers wrote to all police forces in May to advise them that they should be aware of that and of the possibility of violence during the World cup. Forces were asked to consider what measures they could implement, and a range of recommendations were taken forward, including visiting the 10 most likely offenders from previous experience.
Andrew Stephenson
Does my hon. Friend recognise the advantages of taking a coherent, cross-departmental approach to tackling violence against women, particularly in relation to forced marriages?
Lynne Featherstone
Yes, we do recognise that. Violence against women cannot be dealt with by one Department alone, as it cuts across the whole of government. On forced marriage, we all supported the original Forced Marriage (Civil Protection) Act 2007, which was brought forward by my noble Friend Lord Lester of Herne Hill. We will do all we can to work cross-departmentally to make sure that we attack forced marriage, which is unacceptable.
Caroline Flint (Don Valley) (Lab)
Rape is an act of violence against both women and men, and for both women and men who are victims of rape, it is often their lack of confidence in coming forward that prevents people from being brought to justice. What are the implications of the proposals to extend anonymity to defendants in rape trials on the confidence of male and female victims in coming forward?
Lynne Featherstone
Obviously, the conviction rate in this country is not good enough and needs to be improved, and the last thing that we want is for fewer victims to come forward, but we have not yet seen compelling evidence that offering anonymity to defendants would reduce those reporting rates. The attitude that the victim is somehow responsible is prevalent in this country, and that is something that we will be looking at. I assure the right hon. Lady that we will be looking at all the options in terms of addressing this issue and debating it in the House.
Yvette Cooper (Normanton, Pontefract and Castleford) (Lab)
I congratulate the hon. Member for Hornsey and Wood Green (Lynne Featherstone) on her appointment as the Minister for Equalities, and I congratulate the Home Secretary on hers as the Minister for Women and Equalities. The Opposition will be very keen to work with them on areas in which we can help to support women and to promote equalities.
I am sorry that the Home Secretary did not answer this question, as she will be aware of the extent of concern about the Government’s proposals on rape. Will she therefore write to me in reply, in addition to her hon. Friend’s response? I wrote to the Home Secretary on 27 May, in her capacity as the Minister for Women and Equalities, about the Government’s proposal to introduce anonymity for rape defendants. I received a reply from her officials making it clear that this was not seen as her responsibility and that it was being sent instead to the Ministry of Justice. I urge her to rethink that approach because she will know, as the Minister for Women and Equalities and as Home Secretary, that according to the British crime survey, 93% of rape victims are women. Singling out rape uniquely as a crime for which defendants need greater protection against false allegations sends strong and troubling signals about the way that women should be treated in the justice system. I urge her to reconsider this issue and to say whether she thinks it is right for defendants in rape trials to be treated uniquely differently from defendants in other serious crimes.
Lynne Featherstone
I assure the right hon. Lady that we definitely see this as an issue for women and equalities, albeit that it resides ultimately in the Ministry of Justice legislatively, and that the Home Secretary will contact her directly regarding her questions.
Philip Davies (Shipley) (Con)
Does the Minister accept that a large number of victims of domestic violence are men? Given that she is a Minister in the Government Equalities Office, will she confirm that the Government treat domestic violence against men just as seriously as domestic violence against women?
Lynne Featherstone
I thank my hon. Friend for his helpful contribution. I am, indeed, the Minister for Equalities, and both men and women are included in that. Some 4% of men are victims of domestic violence, and given that the figure for women is 6%, those figures are not so disparate.
Chi Onwurah (Newcastle upon Tyne Central) (Lab)
4. If she will take steps to increase the proportion of people entering careers in science and technology who are women.
The Minister for Equalities (Lynne Featherstone)
We are absolutely committed to working with teachers and careers advisers to encourage more young women to enter careers in science, engineering and technology, and to supporting British business to increase opportunities for professional women in this sector. The science and technology sector is critical to the UK economy, and women have an enormous contribution to make.
Chi Onwurah
I thank the Minister for her reply. When I entered Imperial college to study engineering, the proportion of women in engineering was about 12%. More than 25 years later, that proportion is almost exactly the same. Does the Minister agree that that represents a huge failure in the science and engineering establishment of this country and that now, when we need to rebalance our economy towards engineering and science, urgent measures are required?
Lynne Featherstone
Yes, I agree with the hon. Lady, who is an excellent role model in her field, and I should be happy to talk with her if she has ideas to share with me. It is important that we take this forward. Many companies have already taken action to increase the numbers of women in their work force, but we are clearly not moving fast enough. British Gas has been quite good. It has doubled its work force of women engineers by recruiting women and retraining them. We have to move further and we have to move faster.
Karen Lumley (Redditch) (Con)
5. What recent assessment she has made of the effects of flexible working arrangements on gender equality in the workplace.
The Secretary of State for the Home Department and Minister for Women and Equalities (Mrs Theresa May)
I thank my hon. Friend for her question. Flexible working is positive for businesses because it helps them keep valued members of staff. The evidence is clear that flexible working arrangements benefit women, by helping them to balance their caring responsibilities. The coalition Government are united on extending the right to request flexible working; indeed, we have a commitment to do so in the coalition agreement. We will launch a consultation with business at the earliest opportunity.
Karen Lumley
Will my right hon. Friend comment on what wider social benefits the Government believe will result from the extension of flexible working rights?
Mrs May
I am happy to do so, although we should make more of the fact that there are considerable benefits to businesses in providing flexible working, including keeping valued members of staff, attracting members of staff and being able to dip into the widest possible pool of talent. There are enormous social benefits for families when both women and men can better balance their home and work responsibilities through flexible working arrangements. We have seen that already. There are enormous benefits for children when parents are able to spend more time with them.
Liz Kendall (Leicester West) (Lab)
Will the Minister consider looking at the experience of countries such as Norway and Sweden where, as part of promoting greater flexibility and general equality, the Governments have introduced a whole month of parental leave that fathers have to take? This has increased the number of men taking parental leave and helped promote greater equality in the workplace. Will she consider that, as the Government look at their reform of parental leave?
Mrs May
I welcome the hon. Lady to the House. The proposals that we put forward in opposition on flexible parental leave—we are now looking at how we take those forward and improve the arrangements for parents and maternity leave—gave a better offer to men than the one month’s paternity leave that she cites from Norway. It enabled couples to decide who would take the leave that was available and stay at home with the baby after it was born. So I think we can offer fathers and mothers a better opportunity than the hon. Lady suggests.
Legal Aid Payments
(13 years, 10 months ago)
Commons ChamberRead Full debate Read Hansard Text Read Debate Ministerial Extracts
Simon Hughes (Bermondsey and Old Southwark) (LD) (Urgent Question)
To ask the Secretary of State for Justice if he will make a statement on the consequences of the timing of legal aid payments to the charity Refugee and Migrant Justice.
The Lord Chancellor and Secretary of State for Justice (Mr Kenneth Clarke)
Refugee and Migrant Justice entered into administration earlier this week. It wrote to me a month ago warning me of the risk, and has since made requests for substantial assistance from public funds. The organisation was one of many that provide legal advice and representation to individuals on asylum and immigration matters funded by legal aid. The Legal Services Commission is confident that there is widespread provision of legal advice in this area and that overall capacity will not be affected by the closure of Refugee and Migrant Justice. More than 250 offices nationally are currently providing this type of service.
It may help if I explain the background to this unfortunate situation. The Legal Services Commission has worked closely with Refugee and Migrant Justice for the last few years to help the organisation to make the change to a system of payment based on units of work, the graduated fees scheme. As a result, Refugee and Migrant Justice has received substantial support—over and above the support given to not-for-profit and other organisations—to help it transfer to the current payment system.
However, it is crucial that the Government achieve value for public money. The fixed fee system introduced three years ago by the last Government is already being successfully used by the vast majority of not-for-profit organisations in this area of law. As other organisations have successfully made the transition, it is only reasonable to expect Refugee and Migrant Justice to do the same.
It has been suggested, and is implied in the hon. Gentleman’s question, that under this system payments to Refugee and Migrant Justice have been delayed. It is not a question of any late payments. Refugee and Migrant Justice was paid what was due. However, it did not make the efficiency savings that other providers made.
There is significant long-term interest in the work from other providers, both not-for-profit organisations and private solicitor firms. The Legal Services Commission is currently running a tender round for new contracts for immigration and asylum services from October 2010. There has been an increase in the number of offices applying to do the work. Providers have also bid to handle more than double the amount of cases currently available. It would be wrong to divert legal aid funds to one of the bidders in the middle of the bidding process.
In my opinion, given this unfortunate situation, the highest priority must be the vulnerable clients of Refugee and Migrant Justice. Now that the organisation has left the market, the Legal Services Commission will work with it and other providers to seek to minimise disruption and ensure that clients continue to receive a service. I have checked this morning and I can assure the House that the LSC is working closely with the administrators to ensure that any disruption to clients is minimised. Even today, LSC staff have prioritised the approximately 20 clients of Refugee and Migrant Justice who have court appearances.
The Under-Secretary of State for Justice, my hon. Friend the Member for Huntingdon (Mr Djanogly), will ensure that LSC staff continue to prioritise that area. He and I agree that the main task now is to ensure that the interests of that vulnerable group are properly protected and that no one is left without the legal assistance they require.
Simon Hughes
I am grateful to the Secretary of State for his full and careful response. On behalf of colleagues who have huge numbers of asylum and immigration cases involving people who use those services, may I say that I hope he appreciates the importance of the subject to them and to our constituents?
Does the right hon. and learned Gentleman accept that currently—so I am advised—13,000 clients are being looked after by Refugee and Migrant Justice, including nearly 1,000 children, who are of course very vulnerable? Does he accept, too, that the reason for the financial problem is the change in the payment system? Although there has been a reduction in income because the payment system has changed, Refugee and Migrant Justice has also reduced its costs by the same amount—I am advised that it is by 40%—and is now being paid in arrears rather than up front, a system that the Law Society and immigration law practitioners have said is unsustainable. I should be grateful if, in time, the Secretary of State would discuss with those organisations how we might improve the system.
Can the right hon. and learned Gentleman give an assurance that he or his hon. Friend, the Under-Secretary of State will make sure that all clients who have been the responsibility of the organisation are given the assurance that their cases will be fully looked after in the immediate days ahead? Are there any other charities in the field with the same sort of problem? If so, there needs to be some continuing and widened support. Will he or our hon. Friend be willing to meet those of us with a direct interest, and the organisations where appropriate, to make sure that there is a stable and secure footing in the years and months ahead for this most important legally aided work?
Mr Clarke
I am grateful to the hon. Member. Certainly the problem arose as a result of the change to the graduated fees scheme in 2007, but I do not accept that the failure was necessarily caused by that. Every other organisation, including the other not-for-profit organisations, has coped with this. I do not criticise the 2007 decision, but it was designed to improve the efficiency of the use of public funds in providing large amounts of money to give legal aid to those making asylum claims or facing threats of deportation, or whatever. As far as I am aware, this is the only organisation that proved in the end unable to manage its affairs and its finances to avoid the demise that has occurred.
I know that the system is not popular; I know that the Law Society does not like it, but in these difficult times I am not going to go back on it, because it does provide value for money. We have just invited tenders under the system, and the number of people who want to provide services in this area has actually gone up.
Mr Speaker
Order. May I ask the Secretary of State to turn to address the House? I want to hear his mellifluous tones.
Mr Clarke
Amongst many others, Mr. Speaker, so I will certainly address the House.
I agree with the hon. Member that the main problem now is the vulnerable clients up and down the country. We think that there is a wind-off process going on; Refugee and Migrant Justice is still, of course, entitled to be paid for the work going on, but I have asked the Legal Services Commission to pay very strong attention to that. My hon. Friend the Under-Secretary will be giving more attention to that today, to make sure that there is no problem occurring. Certainly one of us will meet the hon. Member and other interested Members, although we may have to take advice on whether we can properly meet them in the middle of the bidding process. This is complicated by the fact that we were in the middle of a bidding contest, which means that one cannot suddenly divert lots of money to one of the bidders.
Mr David Hanson (Delyn) (Lab)
May I first apologise on behalf of my right hon. Friend the Member for Blackburn (Mr Straw), who is out of London today but who takes an interest in these matters generally?
This is a major first: we have the deputy leader of one of the governing parties challenging his own Government on the Floor of the House. I look forward to more of that in the future from the Liberal Democrats.
The policy of returning people under 18 years old to safe places in countries such as Afghanistan was introduced by my right hon. Friend the Member for Kingston upon Hull West and Hessle (Alan Johnson) when he was Home Secretary, and we support it, but it was introduced on the basis of ensuring that there was fair legal representation, of quality, for those who were potentially being deported. Will the Lord Chancellor take steps today to assess, as I think he has already, the viability of Refugee and Migrant Justice, and ensure that this is not just a cash-flow problem? If it is a cash-flow problem, will he ensure that he examines it as a matter of urgency?
Will the Lord Chancellor also meet his right hon. Friend the Home Secretary to look at the issues of joint tendering? I understand that there is tendering for this type of service involving both Departments, and I think there needs to be some consideration of that. Will he particularly look at the points made by the hon. Member for Bermondsey and Old Southwark (Simon Hughes) in relation to the client group who are now potentially left without legal representation, so that we ensure that they receive proper representation of quality and are not forced to undertake representation with, potentially, providers who are not giving the level of service that we would expect?
Finally, in the longer term, will the Lord Chancellor look at the Legal Services Commission as a whole? One thing that my right hon. Friend the Member for Blackburn wished to do was to look at providing for that organisation to become an executive agency as a matter of urgency. We noticed that that was not included in the Gracious Speech; had our party secured government, it would have been. I should be grateful if, in the longer term, the Lord Chancellor looked at those issues for the House.
Mr Clarke
First, I doubt that my hon. Friend the Member for Bermondsey and Old Southwark (Simon Hughes) was asking a particularly aggressive question; he was rightly seeking some more information about a worrying situation, and I do not think the two of us actually disagreed. In any event, coalition government should give us—certainly those of us in the House not bound by collective responsibility—the opportunity to give up the fatuous media convention that every member of every party automatically agrees with every other member of the same party on each and every issue, which the public have never believed anyway.
To return to the more serious question, the organisation is now in administration, so whether it is even remotely possible to rescue its finances is properly a question for the administrators, not for us. It appears to have got into very serious trouble because, over the past month, it asked for large sums to be paid from the legal aid fund for things such as rent. I have already stressed—I accept that the right hon. Member for Delyn (Mr Hanson) was making the same point as my hon. Friend the Member for Bermondsey and Old Southwark—that we must look at the client group and ensure that there is no hiatus in the representation of children and others who were looking to the body, but I think that that can be done.
We rather supported the previous Government’s indications that the LSC should be examined and that consideration should be given to making it an agency, because we must be clear about where policy making is proceeding in the area. I assure the right hon. Gentleman that that is actively in hand, because we have to face difficult issues under the legal aid heading. The matter did not make the Queen’s Speech because important though it is to him, me and many others who look for proper representation in our courts, it was a bit too detailed.
Mr Speaker
Order. May I appeal to Members for short questions and short answers? I remind the House that we have business questions to follow, as well as two further statements and a heavily subscribed debate.
Bob Russell (Colchester) (LD)
I was extremely disappointed by the statement. Complacency seemed to be there; the good samaritan was certainly not. On behalf of those who worked out of the Ipswich office, and in the absence of any other east of England Member wishing to speak, may I ask the Secretary of State to confirm that Members of Parliament who represent predominantly urban seats will find that their work load increases as a consequence of the situation?
Mr Clarke
With the greatest respect, we face a lot of demands on legal aid. Public money should be used to provide individuals with the legal representation they require, but we cannot suddenly start diverting huge sums out of the legal aid budget to bail out a voluntary body that got itself into a financial mess because it did not make the adjustments for the 2007 system that everyone else succeeded in making. I underline the point that plenty of people—both not-for-profit bodies and professionals—want to provide such services and that an increasing number are trying to get into the market. We are ensuring that no one is left without the representation they require.
Keith Vaz (Leicester East) (Lab)
Some of us on the Labour Benches did not support the previous Government’s cuts to legal aid in this area because, as representatives of inner-city areas, we realised that there were few specialist immigration solicitors. Will the Lord Chancellor ask the LSC to consider an emergency franchising of those firms that have expertise so that the casework may be dealt with? The problem is the casework that is not being done by RMJ, so how do we help people now?
Mr Clarke
We will not go back on the graduated fees scheme. It might well be that the previous Government will not have been the only one who had to examine what could be done to improve the efficiency of the legal aid scheme and to address its costs, although I realise that that will not be altogether popular.
There are a lot of specialist firms, although there could no doubt be more. The number of firms bidding has gone up in the present contract round, with 330 organisations bidding for twice the amount of work available. However, I will ask the LSC to consider whether something like the right hon. Gentleman’s proposal might be required in particular cities or areas.
Stephen Mosley (City of Chester) (Con)
I think that part of the problem is that this is not an isolated situation. One of my constituents is owed £11,000 from the past financial year by the LSC. Yesterday, I received an e-mail from the policy consultant of NAGALRO, the professional association for family court advisers and independent social work practitioners, to say that some of its workers are owed more than £15,000 from the previous year—
Mr Speaker
Order. May I gently say to the hon. Gentleman—he is a new Member and these things take time—that an urgent question of this kind is narrowly focused on a particular organisation operating in a given area and that questions and answers must be confined to that? We have heard the hon. Gentleman, and I call the Secretary of State to make a brief reply.
Kerry McCarthy (Bristol East) (Lab)
I think the right hon. and learned Gentleman is confusing quantity with quality when it comes to legal advice on asylum and immigration. Just because there are lots of people coming forward to provide it, it does not mean to say that they are providing good services. Every day in my constituency work I see people who are not getting good advice. Does he agree that it is a false economy for people to go to firms that will not provide them with the service they need? It just means that they then go through the appeals process and make further representations, and that clogs up the system. We should focus on getting reputable organisations, such as the one in question, up and running and providing the services that people need.
Mr Clarke
The contract operation is based on both quality and quantity. My hon. Friend the Under-Secretary and I will certainly ensure that the Legal Services Commission follows through on the fact that there are meant to be quality standards; it is not just a matter of making bids for the work. However, we cannot intervene and take money out of the legal aid fund to rescue one voluntary body. That body is briefing everybody through very extensive public relations activity: archbishops are writing to me, and everybody seems to be informed that the body has gone broke, but someone is still producing a great deal of campaigning material on its behalf. It does very valuable work, but it is no good diverting money from the fund to it because it is the only one that has gone bust.
Fiona Mactaggart (Slough) (Lab)
What this high-quality body has done is highlight a problem that is not restricted to it. In my constituency, which has high immigration advice need, there is no LSC-funded adviser. Will the Secretary of State bring together those Members who have a large number of such cases to discuss with him whether there are better ways of funding immigration advice in our constituencies?
Mr Clarke
I am sure that my hon. Friend the Under-Secretary and I will be only too happy to meet the Members of Parliament particularly affected by the issue. We will have to take advice on whether we will be subject to any kind of legal review if we do that in the middle of the bidding process but, subject to that, we would welcome advice from Members who have particularly large numbers of such cases to deal with, because we will have to look at the whole provision of legal aid in this and other areas.
Mr David Lammy (Tottenham) (Lab)
The right hon. and learned Gentleman has made much of the fact that this is the only voluntary body that has found itself in such difficulties. Does he recognise the volume of immigration and asylum work that has been done and that has to be done? He suggests that other comparable bodies have not found themselves in such a situation; can he name some of those that particularly relate to immigration and asylum?
Mr Clarke
The trust that folded had a 7% market share. It was, of course, part of the old advisory service, which was split up some time ago. The other half of the old advisory service is to get a much bigger market share—over 20%. We are talking about a policy of the last Government, and one with which I do not disagree. The graduated fee scheme was introduced in order to get better value for money out of the legal aid scheme, and everybody had to adjust to it. So far as I am aware, the body is the only one that is in great financial difficulties. In a way, it would have been very awkward for us if it folded after we had awarded the contracts. We would have been in a mess if we had discovered that we had awarded a contract to a financially insecure organisation that went down once we were relying on it to do the work. As far as I am aware, everyone else who is bidding is, I hope, in a sound financial state.
Mr George Mudie (Leeds East) (Lab)
I accept the Secretary of State’s calm approach, and his objective of looking after customers, but I wonder about the accuracy of that. In Leeds, vulnerable people have great difficulty getting representation. We are talking about matters of life and death to those individuals. Will he spell out how he will assure them and this Chamber that no one will go forward without proper representation? In Leeds there is real difficulty, even with the organisation working, to meet the need in the market. How will pulling this firm out of the market help those people to get representation?
Mr Clarke
The LSC tells us that it has full cover for the work. It made a special intervention in 22 cases in which there were court appearances today to make sure that there was representation. I have no reason to doubt that the LSC is on top of the problem, but my hon. Friend the Under-Secretary will spend the rest of the day reassuring us that the LSC and our Department are doing everything they reasonably can to make sure that there is no difficult transition for any of the vulnerable people concerned.
Liz Kendall (Leicester West) (Lab)
Will the Secretary of State provide me and other Members who have a real interest in this issue with regular updates on what is happening? I appreciate his offer to meet us, and the fact that he says he is working to make sure that people have the representation they need meanwhile, but we need that information, too, so that we can share it with our constituents and the organisations involved in providing help and support to asylum seekers and people with immigration cases.
Mr Tom Watson (West Bromwich East) (Lab)
Will the Secretary of State quantify the additional tax-funded resources that have been allocated to support asylum seekers who are affected by the problem?
Mr Clarke
I have to say that I do not yet have at my fingertips the precise increase in recent years in legal aid dependent on immigration cases, or the additional amounts that may have been provided in recent years, but initial amounts of funding were provided for a very large number of purposes by the last Government, and most of those cases are now having to be looked at again.
Business of the House
(13 years, 10 months ago)
Commons ChamberRead Full debate Read Hansard Text Read Debate Ministerial Extracts
Ms Rosie Winterton (Doncaster Central) (Lab)
Will the Leader of the House give us the business for next week?
The Leader of the House of Commons (Sir George Young)
The business for the week commencing 21 June will include:
Monday 21 June—General debate on the strategic defence and security review.
Tuesday 22 June—My right hon. Friend the Chancellor of the Exchequer will open his Budget statement.
Wednesday 23 June and Thursday 24 June—Continuation of the Budget debate.
The provisional business for the week commencing 28 June will include:
Monday 28 June—Conclusion of the Budget debate.
Tuesday 29 June— Opposition day (2nd allotted day). There will be a debate on an Opposition motion, subject to be announced.
Wednesday 30 June— General debate on the progress and prospects in energy efficiency.
Thursday 1 July—General debate on global poverty.
Hon. Members will wish to be reminded that the House will meet at 11.30 am on Tuesday 22 June.
I should also like to inform the House of business in Westminster Hall:
Thursday 1 July—A debate entitled “Supporting carers to have a life outside caring”.
Ms Winterton
I thank the Leader of the House for setting out the forthcoming business.
If there are any statements to be made next week, can we make sure that we do not have a repeat of last week’s discourtesy to the House, when General Sir Jock Stirrup’s departure was announced in the Sunday papers, and by the Secretary of State for Defence on television, but was not even mentioned in the Prime Minister’s statement to the House on Monday? That is hardly the way to treat the Chief of the Defence Staff.
If there are not any planned statements, could the Leader of the House check with the Cabinet whether there ought to be, given that this week the Chancellor of the Exchequer, who is becoming something of a serial offender in this respect, again had to be summoned to the House because once again he wanted to make a key announcement, but not to Members of Parliament? We understand that the Chancellor had suggested that the new Chief Secretary to the Treasury might have an airing, but thought better of it on account of the Chief Secretary being a bit nervy under fire. We are quite pleased that the Chief Secretary is to turn out today.
As it turned out, the Chancellor was announcing yet another commission. Just so that we know whether any decisions remain that are likely to be made by Ministers as opposed to being outsourced to a commission or review, will the right hon. Gentleman place details in the Library of all the commissions that the Conservative-Liberal Democrat Government have set up, all the reviews that have been announced, the number of people who are involved in the reviews and commissions, their terms of reference and their cost? Will he give us a pointer as to whether the Government need so many Ministers to carry out the business of government, given that there might not be a lot left for them to do after all the commissions and reviews have been set up?
I see that the Leader of the House spoke at the Hansard Society last night about altering party conferences. Obviously, the Conservative and Liberal Democrat conferences could be merged and simply called the Conservative party conference.
Mr Speaker
Order. I am sorry to interrupt the shadow Leader of the House. Doubtless the subject is genuinely scintillating, but it is not a matter of Government responsibility. I hope that the right hon. Lady might want to move on to something that is.
Ms Winterton
Thank you, Mr Speaker. I simply wanted to ensure that if the Leader of the House intends to refer us to the Procedure Committee, as his speech suggested, there will be discussions with all the parties before that is done. I certainly have not been consulted and, as far as I know, nor have other parties. Will he ensure that consultation happens?
On anonymity for defendants in rape cases, we are now getting increasingly confusing and contradictory comments from the Home Secretary, the Justice Secretary and, indeed, the Prime Minister. Three weeks ago, the Government pledged to give defendants anonymity. Two weeks ago, the Prime Minister appeared to change that position to one whereby the accused would be named only if prosecutors brought charges, and this week the Justice Secretary blamed the Liberal Democrats, saying that they had adopted the policy in opposition. There was further confusion at questions to the Minister for Women and Equalities today.
Ministers keep saying that they want a proper, considered discussion, but it is extremely difficult for hon. Members to contribute to any discussion when it is completely unclear which Minister is speaking for the Government. The policy seems to be the victim of hasty negotiations, but the real victims will be women who have been raped. The need for a proper debate on the subject has now become urgent, and I ask the Leader of the House to give us an assurance that he will allocate one of the Government’s general debates—we have a lot of them at the moment—to it.
Sir George Young
I am grateful to the right hon. Lady. On the Ministry of Defence, Sir Bill Jeffrey and Air Chief Marshal Sir Jock Stirrup have announced to their staff that they will retire in the autumn. Both stayed on longer than they originally intended to see things through over the election period and to get through the strategic defence and security review.
The Government have made many statements—nine since the Queen’s Speech. We have been very open with the House, and about five, perhaps even seven statements have been made this week. The Speaker has indicated that he wants more urgent questions, and that is a useful way to hold the Government to account and keep the House informed.
The Chief Secretary is robust under fire and can give as good as he can take.
I have answered a written question on reviews, referring to the coalition agreement, which sets out the Government’s key reviews and priorities. It is then up to individual Departments to provide information about their reviews.
In my compelling speech last night to the Hansard Society, I said that perhaps it was time for an open and serious debate, in which hon. Members of all parties should be engaged, about sitting hours and sittings in September, to ascertain whether we have the right configuration and whether we are making the best use of our time.
Anonymity for defendants in rape cases is a serious issue, about which there is a wide range of views. The Government are determined to drive up the conviction rate for rape and ensure that those who are convicted get serious sentences. I agree with the right hon. Lady that it is right for the House to debate the matter seriously and calmly, and I will do what I can to provide for such a debate.
Chris Heaton-Harris (Daventry) (Con)
Will my right hon. Friend find time for a debate on planning guidance for local councils now that the regional spatial strategies have been abolished? In my constituency and many surrounding rural constituencies, there are many proposals to erect vast numbers of wind turbines the size of the London Eye. I greatly hoped that we could have some guidance about extending what happens in Scotland and many other European countries so that we have an exclusion zone of 2 km from dwellings.
Sir George Young
I understand that my hon. Friend is not a fan of wind turbines. The Government’s view is that communities should be protected from the unacceptable impacts of development. Current planning policy in England is that the distance between a wind farm or turbine and a home should be decided on a case-by-case basis. However, I will bring my hon. Friend’s concerns to the attention of the Secretary of State for Communities and Local Government.
Nia Griffith (Llanelli) (Lab)
Will the Leader of the House find time for a debate on competition among providers of liquefied petroleum gas to householders in rural areas? My constituents in the village of Llannon find themselves in an impossible situation because when one person has a contract with one company, no one else can go to another provider. That needs serious reconsideration.
Sir George Young
Like the hon. Lady, I have a rural constituency where many people are dependent on one supplier of LPG. Speaking from memory, I think that the Office of Fair Trading had been invited to conduct a review of the matter. I will draw her concern to the attention of the OFT and see whether the issue might be revisited.
Nicholas Soames (Mid Sussex) (Con)
My right hon. Friend will know about the great success of the south of England show at Ardingly recently. Does he also know that I am president of the hounds show at Ardingly? Will he see what he can do to lay aside some Government time for a debate on the future of farming, particularly getting more young people into the industry, the security of the food supply in this country and essential research and development for the future of farming in Britain?
Sir George Young
I was not aware that my hon. Friend was president of the hounds show, but I am not surprised. The Secretary of State for Environment, Food and Rural Affairs has attended several agricultural shows and I will draw her attention to the success of the one at Ardingly.
My hon. Friend makes a serious point about the future of farming and the need to increase young people’s interest in that career. I will do what I can to see whether we can provide a forum so that he can share with the House his important views on the subject.
Mr Dave Watts (St Helens North) (Lab)
Following my right hon. Friend the shadow Leader of the House’s question, will the Leader of the House state when he took over responsibility for setting Labour party conference dates?
Sir George Young
That is a wilful misrepresentation of what I just said. I said that I think the House should have a serious debate about its sitting hours, when it sits in the summer and whether the 82-day summer recess that we have had in the past is the right way forward. I think all parties might consider whether party conferences are immoveable or whether there is a more intelligent way of reorganising the political year. I accept that it is not a matter for one party, but one for all parties and the House. I hope that the House will engage in that debate in the spirit in which I launched it.
Nicky Morgan (Loughborough) (Con)
Will my right hon. Friend find time for a debate on the actions of bailiffs? The subject was mentioned in the coalition agreement and I am sure that many hon. Members have examples of constituents who have been targeted by bailiffs. As I understand it, that area of law is unclear and it would be helpful to have a debate.
Sir George Young
The coalition agreement is specific on the matter. We will provide more protection against aggressive bailiffs and unreasonable charging orders, ensuring that courts have the power to insist that repossession is always a last resort and to ban orders for sale on unsecured debts of less than £25,000. Better regulation of bailiffs will be one of the strands of that policy as we develop it.
Mr Nigel Dodds (Belfast North) (DUP)
Last week at business questions, the Leader of the House, in response to the hon. Member for Beckenham (Bob Stewart), indicated that allowances issues are no longer a matter for the House. Of course the administration of allowances is now a matter for the Independent Parliamentary Standards Authority, but is the question of who is entitled to allowances still a matter for the House? Will he therefore correct the record, and in addition confirm that the administration of Short money is still a matter for the House, and that it will remain so?
Sir George Young
The right hon. Gentleman is absolutely right on that last point—the administration of Short money is a matter for the House—and I answered questions on that last week. IPSA is responsible not only for the administration of the allowances but for the policy on allowances, as a number of hon. Members said in yesterday’s debate in Westminster Hall. IPSA has simply carried forward the regime that it inherited from the House on questions such as whether Members are entitled to pay or allowances. Under the current legislation, it remains a matter for IPSA to make any changes in the allowance regime.
Mark Lancaster (Milton Keynes North) (Con)
May I add to the calls for a debate on regional spatial strategies? The Government’s decision to scrap housing targets was most welcome, but it poses questions for the future of Milton Keynes Partnership—the unelected quango in my constituency—its role as a planning authority, the ownership of the land bank and the future of the local plan. A debate would help to clarify those points.
Sir George Young
My hon. Friend makes a forceful case for a debate in Westminster Hall, so that Communities and Local Government Ministers can address the issues he has outlined, and see whether responsibility can be passed down to the locally elected local authorities in his constituency.
Geraint Davies (Swansea West) (Lab/Co-op)
There is growing concern that further increasing student fees will deter students from poorer backgrounds. I am meeting Luke Young, the president of the Swansea students’ union, next week. When will the right hon. Gentleman timetable a debate on student fees, particularly when we should be tooling up all our young people, but particularly those from poorer backgrounds, for the recovery that we all hope is ahead?
Sir George Young
That is a devolved matter in Wales. So far as England is concerned, we are awaiting the outcome of the inquiry by Lord Browne of Madingley. One of the key things that the Government will be looking at is exactly what the hon. Gentleman mentioned— whether any changes would impede or promote access to higher education by students from low-income families.
Mr Andrew Turner (Isle of Wight) (Con)
Will the Leader of the House arrange an early debate on Members who refuse to take their seats and fail to give proper representation to their constituents?
Sir George Young
That is a candidate for debate, and a sensitive issue. I can give no guarantee that the Government will find time for such a debate, but it is a perfectly legitimate candidate for a debate in Westminster Hall.
Mark Lazarowicz (Edinburgh North and Leith) (Lab/Co-op)
Yesterday the North report, which recommends reductions in drink-driving limits, was published. An hour or so ago, the Secretary of State for Transport said that there would be consultation in Government Departments on the proposals, yet newspapers have been full of reports—inspired, it would appear, by ministerial briefings—that the proposals would be rejected. One headline states: “Motorists escape bid to lower drink-drive limit”. Will the Government agree to a debate in Government time to clarify their policy on drink-drive limits? The Leader of the House is a great supporter of road safety, so I hope he agrees to such a debate, and confirms that the Government will be positive about reducing drink-drive limits.
Sir George Young
This is an important issue and our priority is to tackle drink and drug driving in the most effective way. I listened to the Transport Secretary’s response a few moments ago, and I did not detect the equivocation that the hon. Gentleman alleges. The Transport Secretary said that the report covered a wide range of issues and made 51 detailed recommendations, which the Departments concerned need to consider carefully. He also said that the Government would respond to Sir Peter in due course. However, on top of that, I agree that it is an appropriate matter for the House to debate.
Angie Bray (Ealing Central and Acton) (Con)
One of my constituents recently turned up for duty in court as a witness and spent most of the day there, but was then sent home because no other witnesses turned up. He wasted most of his day but, more importantly, the court case had to be delayed again. Does my right hon. Friend agree that we need to consider more measures to ensure that witnesses are made to turn up when they are required, so that cases are not postponed or even put off altogether?
Mr Speaker
Order. I am sure the hon. Lady is seeking either a statement or debate.
Sir George Young
I am grateful to my hon. Friend. It is important that we use the resources of the court system effectively, so that the sort of waste to which she refers does not occur. I will contact the Justice Secretary and share her concerns with him, and see whether the Government have proposals for making better use of the available resources.
Mr Chuka Umunna (Streatham) (Lab)
On 26 May, the then Chief Secretary to the Treasury came to the House and said in answer to an urgent question on the future jobs fund that Government
“policy…has to be informed by the facts, and…advice…from the Department for Work and Pensions”.
He added that that advice was that the fund
“was…not effective and that the money was wasted.”—[Official Report, 26 May 2010; Vol. 510, c. 164.]
However, when I visited my constituency’s district Jobcentre Plus office on Monday, I was told that it was far too early to judge the effectiveness of the scheme, because no data are yet available. May I suggest that we have a debate on the scheme, so that we can work out whether what we are being told about the DWP’s view of the matter is a reflection of what is happening on the ground?
Sir George Young
The hon. Gentleman makes a good case for a debate. The future jobs scheme cost about £6,500 per place, which is about five times the cost of other components of a similar programme. Many of the jobs were relatively low-paid and insecure, and many were in the public sector. The Government believe that we have better approaches to dealing with unemployment—namely, the Work programme—but I hope that it will be possible at some point to discuss the issues that he raises. That could happen in the context of the Budget debate, because I believe that the Work and Pensions Secretary will speak then.
Bob Russell (Colchester) (LD)
Mr Speaker, as the defender of the rights of MPs, I am sure that you were aware of the debate on the Independent Parliamentary Standards Authority that took place in Westminster Hall yesterday, which about 50 Members attended, and of the excellent speech made by the right hon. Member for Tonbridge and Malling (Sir John Stanley). The matter cannot be allowed to remain there; we need to take it forward. The Leader of the House will know that the right hon. Gentleman spoke of the
“interface between parliamentary privilege and IPSA’s decisions”
and
“the privilege of freedom from obstruction in the performance of parliamentary duties.”
He quoted pages 75 and 143 of “Erskine May”, and referred to what it says under the heading, “Obstructing Members of either House in the discharge of their duty”.
With that in mind, does the Leader of the House agree that it is time that we had a Minister at the Dispatch Box for a debate, because the right hon. Member for Tonbridge and Malling concluded that IPSA
“is obstructing Members in the efficient and effective discharge of their parliamentary duties”?—[Official Report, 16 June 2010; Vol. 510, c. 144-145WH.]
Sir George Young
I attended that debate and heard my right hon. Friend the Member for Tonbridge and Malling (Sir John Stanley) make that speech. The debate was, of course, replied to by a Minister from the Cabinet Office. If any Member believes that there has been a breach of privilege, a procedure can be followed, which involves an approach to Mr Speaker.
Glenda Jackson (Hampstead and Kilburn) (Lab)
During Transport questions, the Secretary of State made it clear that his priorities are encouraging economic growth and reducing carbon emissions, yet Transport for London is proposing massive job cuts and the closure of virtually every ticket office on the London underground. Those actions will impact directly against the Secretary of State’s hopes. May we have a debate on that, and not least on what seems to be a marked lack of communication between the coalition Government and the Conservative Mayor of London?
Sir George Young
I understand the hon. Lady’s concern, but the staffing of individual underground stations is a matter for TfL, which may be having to do what Departments are having to do: coping with the economic legacy that we have inherited. Perhaps at some point Opposition Members will tell us where the £50 billion of cuts they identified before the election would have applied.
Robert Halfon (Harlow) (Con)
Will the Leader of the House find time for a debate on the big society? Many community organisations in Harlow are keen adopters of the big society reforms that will do so much to transform voluntary groups up and down our country.
Sir George Young
I am grateful to my hon. Friend for that question. The Prime Minister’s speech on the big society has indeed whetted the appetite of voluntary organisations up and down the country for further development of that policy. I agree that the question of how we engage the resources of the third sector is important. I am not making a commitment, but I should like to find time for a debate if we can.
Luciana Berger (Liverpool, Wavertree) (Lab/Co-op)
Two weeks ago, I asked the Leader of the House if he would kindly urge the Home Secretary to update us on the review of dangerous dogs legislation initiated under the last Government. He said that the Home Secretary would do so during the Queen’s Speech debate, but unfortunately that did not happen. May I again urge him to ask the Home Secretary to come to the House and update us on the review of that legislation?
Sir George Young
I am grateful to the hon. Lady, and if there has been a discourtesy, I apologise. I will pursue the issue further, and Home Office questions will be held on 28 June, when she may have an opportunity to raise the matter again.
Mr Philip Hollobone (Kettering) (Con)
What is my right hon. Friend’s thinking in changing the hours of Tuesday’s Budget day to those of a Wednesday sitting? Should we take that change as a pilot for changes to future Tuesdays?
Sir George Young
It would be wrong to read too much into the changing of the time for the Budget debate. After consultation, we took the view that it would be for the convenience of the House to begin the debate a little earlier. My hon. Friend makes the point that at some stage we will need to look at the sittings of the House. We have many new Members and we have to operate within a slightly different regime, so there is an appetite for intelligent debate about how the House uses its time.
Mr Angus Brendan MacNeil (Na h-Eileanan an Iar) (SNP)
The Leader of the House raised the issue of the recess. Midsummer’s day is in four days’ time, but Parliament does not start its so-called summer recess until five weeks later. May we for once have a summer recess in the summer, a shorter recess and one that takes place during the Scottish school holidays, which are, of course, actually in the summer? That could help MPs to be more available to their constituents at summer events. May we have a debate on the timing of the recess?
Sir George Young
I do understand that for MPs with Scottish constituencies the summer recess does not coincide with the school holidays in Scotland. The hon. Gentleman reinforces the point made in earlier exchanges about the need to stand back and look at when the House sits and consider whether we make the best use of our time.
Mr Phil Woolas (Oldham East and Saddleworth) (Lab)
In opposition, the Leader of the House was always a supporter of enhanced post-legislative scrutiny and, in particular, of finding time for debates on Law Commission reports. Can he update the House on what plans he has in that respect, and does he think that there is too much legislation or too little?
Sir George Young
I think that there has been too much legislation. We are determined to have less legislation and better drafted Bills, with proper time allowed for the House to reflect on them. That will be a transformation compared with what happened in the last Parliament.
Good governance involves post-legislative scrutiny, as well as the production of draft Bills and a pre-legislative stage. Every Department should produce a summary, a few years after legislation has been enacted, stating whether it has met its objectives, and Select Committees have a role to play in post-legislative scrutiny, as well as their other tasks. In a word, the answer is yes.
Toby Perkins (Chesterfield) (Lab)
For several weeks, I have been attempting to obtain support from IPSA to offer jobs to people who want to work in my constituency office. The failure of IPSA to respond to me by phone or e-mail is putting tremendous pressure on my office’s ability to provide a service to the people of Chesterfield who sent me here. Will the Leader of the House make a statement on what support he can give to new Members who are attempting to staff their offices, but who are having to rely on voluntary contributions to provide a service to their constituents?
Sir George Young
I am sorry that the hon. Gentleman has not been able to provide the service that he wants because of difficulties with the allowance regime. The whole object of the allowance regime is to enable MPs to look after their constituents and hold Ministers to account. If it is not doing that, it is a serious matter. I will ensure that the interim chief executive is aware of the issues that the hon. Gentleman has raised and that he gets a prompt response.
Chris Bryant (Rhondda) (Lab)
The Leader of the House said that he wants less legislation, but there could not be any less legislation than at present, because he has announced none. When will we have a Second Reading on one of the many plans for legislation that the Government have announced, so that we can scrutinise it, and when will he set up the European Scrutiny Committee, so that we can scrutinise their plans on Europe?
Sir George Young
In the Queen’s Speech, we outlined 22 Bills for an 18-month Session. We have already introduced three of them—one in the House and two in the other place—and I anticipate a finance Bill before too long. I also anticipate two more Second Readings before the summer recess.
Fiona Mactaggart (Slough) (Lab)
Will the Government arrange, in Government time, a debate on the effects on employment of Government policies? I estimate that the recently announced cuts will cost at least 30 jobs in Slough—a town where unemployment has fallen month on month since the start of the year. Will the Government give us a chance to discuss the effects of what they are doing?
Sir George Young
May I return the compliment and suggest that the Opposition use one of their Opposition days to explain where they would have found the £50 billion cuts that were factored into their pre-election statements? They never told us where those cuts would come from, and they would have included some £18 billion of cuts to the capital programme. They said that they would tell us after the election where they would find those cuts, and the time is now ripe.
Michael Connarty (Linlithgow and East Falkirk) (Lab)
Will the Leader of the House arrange for someone from the Government to come here and tell us why they are afraid of scrutiny of their behaviour in Europe and why they have not set up the European Scrutiny Committee, which was the first Committee set up in the last Parliament by the previous Government? Are they afraid of the Euroscepticism generated on their Benches when they were in pre-election mode, or are they afraid of the ESC, which of course won an inquisitor of the year award when we had a Labour Government and it had a Labour Chair?
Sir George Young
I am grateful to the hon. Gentleman for the work that he has done on the ESC. I am aware that documents continue to arrive from Europe that need scrutiny and that, at the moment, there is no ESC. There is no conspiracy along the lines that he suggests. Urgent discussions are taking place along the usual channels, and I hope that it will not be too long before we can establish the ESC. I am sure that whoever chairs it will do a fantastic job.
Mr Tom Watson (West Bromwich East) (Lab)
In the light of the Alston report to the United Nations, a debate on the conventions used in the deployment of advanced military technology would allow us to debate whether international law has to be reformulated as a result of that report. Do the Government believe that drone planes should be used for the targeted extra-judicial killings of suspected terrorists?
Sir George Young
The hon. Gentleman raises a serious question. I do not know whether it would be appropriate for him to make that point in the debate on the strategic defence review, but I will certainly pass his concerns on to the Ministry of Defence and ensure that he receives a reply.
Mr Denis MacShane (Rotherham) (Lab)
Thank you for the introduction, Mr Speaker.
Last night, Europe’s Conservative party leaders and Prime Ministers met for dinner, with the exception of our Prime Minister, because he is in alliance with—as the Deputy Prime Minister puts it—“nutters, anti-Semites...and homophobes”. May we have an early debate on rise of nationalist, populist extremism in eastern Europe, the worries of Jewish communities and the extent to which the Conservative party—not the Liberal Democrats—are giving cover by their alliance with these people?
Sir George Young
I am sorry that business questions are ending on that note. The right hon. Gentleman has been pursuing this issue for many months, but there is no substance in the accusations that he has made about our colleagues. I am sure that given more time he could have found a better question to ask on the business.
Mr Speaker
I am grateful to right hon. and hon. Members for their co-operation.
Public Spending
(13 years, 10 months ago)
Commons ChamberRead Full debate Read Hansard Text
The Chief Secretary to the Treasury (Danny Alexander)
With permission, I wish to make a statement on the Treasury’s review of the public spending commitments made by the last Government between 1 January 2010 and the general election. In the review, we examined the £34 billion of spending that was approved in their final few months of office. The aim was to test in each and every case whether those commitments are affordable, whether they deliver value for money and whether they remain genuine priorities for this Government.
The review is now complete, and my decisions on those commitments fall into three categories—projects where spending will be approved, because they are a high priority or because the money has largely been spent; projects that will be cancelled; and projects whose long-term affordability will be considered as part of the wider spending review process over the coming weeks and months.
A detailed list of the projects that have been cancelled or suspended until the spending review has been laid in the Libraries of both Houses.
For those projects that offer value for money and meet the Government’s priorities of fairness and responsibility, or for those that it is simply too late to withdraw, we have acted quickly to confirm approval in order to avoid disruption. For example, we have approved the funding for essential medicines in the case of a flu pandemic, some hospital projects and support to post offices, as well as for spending on crucial equipment for military operations in Afghanistan. The House will be aware, however, that as a country today we have the biggest peacetime budget deficit in our history. We have a choice: we can act fairly, responsibly and decisively now, or we can follow the approach of the previous Government—deny and delay—which would only end in greater cuts being forced upon us. Given our priority to get the deficit under control, the Government collectively have looked at each project, and I am grateful for the support of Cabinet colleagues in this process.
Some commitments are simply unaffordable, do not meet Government priorities and will be cancelled. We have taken the decision to cancel immediately 12 projects that would have cost nearly £2 billion over their lifetime. They include the Department for Communities and Local Government’s regional leader boards; the Department for Business, Innovation and Skills’ loan to Sheffield Forgemasters; the Department for Work and Pensions’ low-value employment programmes, including the extension of the young person’s guarantee to 2011-12 and the jobseeker’s two-year guarantee; the Department of Health’s active challenge routes, county sports partnerships and the North Tees and Hartlepool hospital project; the local authority business growth incentive; and the withdrawal of Government funding for the Stonehenge visitors’ centre. Many of those are difficult decisions and, I fully understand, painful ones for some of the communities affected—communities whose hopes were irresponsibly raised by the previous Government. However, they are decisions that a responsible Government must face up to in these difficult economic times.
Other decisions should be weighed up against all the other significant pressures on public spending within the context of the spending review—a spending review that the Labour Government delayed because they did not want to admit that painful decisions had to be made. For this reason, I can announce that there are a further 12 projects, with a total value of £8.5 billion, approved since 1 January that we will suspend and refer for consideration to the spending review process over the coming weeks and months. They include the health research support service, the Kent Thameside strategic transport programme, and the libraries modernisation programme. Any other new major hospital schemes will be assessed in the context of the spending review to ensure that they are affordable and represent the highest possible value for money. Only the highest priority schemes will be able to go forward. We will do this in the context of the approach set out in our spending review framework, which will include a fundamental review of all capital investment plans, to identify those areas that will achieve the greatest economic returns.
The Secretary of State for Education has already announced that he is looking at the whole Building Schools for the Future programme and will shortly set out the outcome of this work. That programme has been very heavily overcommitted, and we are in agreement that tough decisions need to be taken. Departments have also independently reviewed projects with budgets within delegated limits approved since 1 January, and they will report the results of those reviews in due course. Together, these decisions will significantly relieve burdens on departmental budgets that will be under major pressure in the spending review.
While conducting this review, I have discovered yet another black hole in the books that we inherited. I can tell the House that billions of pounds of spending commitments were made for this financial year that relied upon underspends or access to the reserve. There was no reason to suppose that underspends would have occurred on anything like that scale and there is insufficient contingency in the reserve to cover the remainder. I will therefore be cancelling at least £1 billion of commitments where there simply is not the money to pay for them. We will announce the action that we will take to tackle this further hole in the accounts in next week’s Budget. As far as the reserve is concerned, I am sure the House will agree that our priority is that we keep this for genuine emergencies and new pressures that may result from military operations in Afghanistan.
The last Government committed to spend money that they simply did not have. They made commitments that they knew the next Government could not fulfil and in doing so cynically played politics with the hopes of our communities. The actions that I have set out today show that this Government will take responsible spending decisions, which, although sometimes difficult, will be guided by fairness and the overriding need to tackle the deficit. We did not make this mess, but we will clean it up. I commend this statement to the House.
Mr Liam Byrne (Birmingham, Hodge Hill) (Lab)
I thank the Chief Secretary for early sight of his statement, which arrived a few moments ago. We were all impressed not to read his conclusions in the newspapers this morning. I congratulate him on his first statement to the House as Chief Secretary. I think that it was George Bernard Shaw who said that sometimes to succeed in politics one must rise above one’s principles—and few have risen so fast and, I now see, so far as the right hon. Gentleman.
I start with a word of thanks to the Chief Secretary for finally nailing the myth that Labour generated some kind of scorched-earth policy, of which we heard so much in the first days of the coalition. The projects that he has decided to outline this afternoon amount to just 0.05% of this year’s Government spending. At the beginning of the week, we heard from Sir Alan Budd, who told us that the outlook for public finances is £30 billion better than expected, but now the Chief Secretary, who cannot even claim the defence of independence, has smashed the coalition’s claim that Labour spent unwisely. The House is united in its ambition to see the deficit paid down quickly. The defence of our country from the global recession did not come cheap, and now the bill must be paid, which is why we set out with such clarity £19 billion of tax increases and £20 billion of detailed spending cuts over the next two years alone.
I, too, have reviewed the spending decisions taken since January, and my thanks go to the Treasury staff for facilitating this review. I am glad that the decisions that we took on green energy, university modernisation, Airbus, Nissan, Ford, the automotive assistance programme, royal research ships, phase III of the Diamond science programme, the Tyne and Wear metro, the Leeds next generation transport scheme, Manchester Metrolink, the regeneration of Blackpool, accelerated development zones, Olympic park restructuring, hundreds of millions of pounds for the Ministry of Defence, £30 million for children’s hospices and three new hospitals have been reaffirmed.
The country and the Liberal Democrats beyond, however, will be aghast this afternoon at the Chief Secretary’s attack on jobs, his attack on construction workers, his attack on industries of the future and the cancellation of a hospital. What could be more front line than that? In five minutes this afternoon, he has reversed three years of Liberal Democrat policy, of which he was the principal author. What a moment of abject humiliation! He will no doubt claim that the markets forced his hand. These were the markets in which interest rates were falling, not rising, throughout the winter and spring. He claims there is no reason why the Government can assume to carry forward underspends from previous years, despite the fact that, as he well knows, billions are underspent each year, including last year.
It is customary on these occasions to ask the Minister a wide range of questions, but I will give him the luxury of answering only one, although I expect a straight answer: how many people will lose their jobs this year as a consequence of what he has just told the House? Do not beat about the bush—tell us how many.
Danny Alexander
I am grateful to the shadow Chief Secretary for his response and for welcoming me to my post. He is right that a number of projects have been approved, and Departments will set out details of those projects, or where they are seeking further savings within those approvals, over the next period. They are also, of course, reassessing those approvals given within delegated limits, as I said in my statement, so there will be further announcements to make on that.
The right hon. Gentleman’s characterisation of the Office for Budget Responsibility’s report was surprising, given that the report showed that, in fact, growth was expected to be significantly lower than was forecast by his Government in the last Budget and that the structural deficit—that part of the deficit that can be paid down only by Government policy action—was considerably higher. He set out what he said were Labour’s plans. We look forward to hearing more detail about that. If he is committed to a shared deficit reduction plan, I look forward to his party finally setting out in detail what it would take to meet the £50 billion of cuts that it proposed to set out.
As for consistency with the approach of the Liberal Democrats, which the right hon. Gentleman asked me about, the position is entirely consistent with the approach that we took during the election campaign, in common with our coalition partners, on ensuring that firm action is taken to reduce the deficit. That must be the overriding priority. He said that end-year flexibility is used year by year to meet commitments, but the volume of commitments that were made under the previous Government is so large that it calls into question the Government’s ability to have a reserve at all. Therefore, we have to take action to reduce those claims in early course, and that is what we are going to do in the Budget.
The single biggest risk to jobs in this country is not taking action to reduce the deficit. If we fail to take action to reduce the deficit, we will see jobs lost across the country. We need to restore confidence to the economy.
What we have learned from today’s statement is that the shadow Chief Secretary went on a pre-election spending spree when in office, in the full knowledge that the Government had long since run out of money. The House will be familiar with the shadow Chief Secretary’s now infamous letter to his successor, but allow me to contrast that with the letter that I received on my desk from my right hon. Friend the Member for Yeovil (Mr Laws). The right hon. Member for Birmingham, Hodge Hill (Mr Byrne) wrote:
“I’m afraid there is no money…good luck!”
However, my right hon. Friend’s advice was rather more helpful. On leaving the Treasury, he left me a note saying:
“good luck, carry on cutting…with care.”
Contrast the previous Government’s approach with ours. They raised false hopes by promising the public that they would spend money on local projects that they could never afford to get off the ground, even under their own spending plans. We on the other hand have been candid about the scale of the task. We have made it impossible to fiddle the economic figures to suit our Budgets, and we are taking responsible and measured action on historically unprecedented levels of borrowing.
Mr Deputy Speaker (Mr Lindsay Hoyle)
Order. Many hon. Members wish to get in. We have another statement to follow and there is business after that. I will certainly try to call as many hon. Members as possible, but if we can have quick questions and succinct answers, that will be of benefit to all.
Michael Fallon (Sevenoaks) (Con)
Is it not pretty clear that some of those projects were hastily scribbled cheques on a long overdrawn account? Would not today’s painful announcement have been completely unnecessary if Labour had carried out a proper comprehensive spending review last autumn, building into it a sustainable reserve?
Danny Alexander
The hon. Gentleman is absolutely right. If there had been a spending review, we would not be in this position now. As it is, out of the £34 billion of commitments that the previous Government made in that period, we have had to cancel £2 billion and put £9 billion into the spending review. The choice is obvious: profligacy on the one side, responsibility on the other.
Jon Trickett (Hemsworth) (Lab)
There will be fury in Wakefield and my constituency, where people are expecting schools to be rebuilt and where we absolutely must have the 70 additional hospital beds to make proper provision. Any cancelled patient operations as a result of today’s decisions will be laid entirely at the right hon. Gentleman’s door. His party have joined with the other coalition party in being the party of mass unemployment. Some 300,000 building workers are already out of work. What is his estimate of the increased unemployment that he will produce as a result of his statement today?
Danny Alexander
I understand that some of these decisions are difficult for communities and that there will be genuine anger, which the hon. Gentleman has expressed. However, that anger should be directed at those on his own Front Bench who took irresponsible decisions that could not be afforded. We are now putting that matter right.
Mr Andrew Turner (Isle of Wight) (Con)
Will the Chief Secretary accept my thanks for finding the money for the private finance initiative for roads in my constituency?
Mark Tami (Alyn and Deeside) (Lab)
The previous Labour Government agreed launch-aid investment for the Airbus A350, which will help to secure tens of thousands of jobs in the UK. Can the Chief Secretary confirm that that will be paid in full and that he will not revisit the matter?
Danny Alexander
As I said in my statement, spending Departments will make announcements themselves about the projects that have been approved.
Tom Brake (Carshalton and Wallington) (LD)
I had hoped to hear the words “better health care closer to home” and “St Helier hospital” in the Chief Secretary’s statement. Can he update us on the position in relation to that hospital project?
Danny Alexander
We have considered a number of hospital projects against affordability and value for money criteria. It has been agreed that the Epsom and St Helier, Royal Liverpool, Royal National Orthopaedic and Pennine acute hospital schemes will go ahead.
Mr Tom Watson (West Bromwich East) (Lab)
There is a curious part in the right hon. Gentleman’s statement on the successor deterrent extension to concept phase long-lead items on Trident. What is the value of that, and can he explain why he did not tell the House that he is reviewing Trident? Does he not know what he is doing, or is he embarrassed and ashamed?
Danny Alexander
The hon. Gentleman knows perfectly well that, in the context of renewing the deterrent, the coalition has agreed a value-for-money review. In the context of that, spending £67 million on long-lead items in advance of the value-for-money review being completed would be utterly irresponsible.
Sajid Javid (Bromsgrove) (Con)
I thank the Chief Secretary for outlining Labour’s cuts. Will he take this opportunity to remind the House just why we face such a difficult spending round?
Danny Alexander
We are facing a difficult spending round for two reasons: first, we have the largest peacetime budget deficit since the war—£155 billion—with an 8% structural deficit, which is larger than had previously been estimated; and secondly, the previous Government took irresponsible spending decisions at the end of their time in office and that has added to the pressure on Departments in the spending review. I am seeking to relieve that pressure in today’s statement.
Ann Coffey (Stockport) (Lab)
In the last Parliament, the then Secretary of State for Transport agreed to part-fund the A6 bypass—a road that is important in relieving congestion on the A6 in my constituency. Will the Chief Secretary agree to meet me and other Members of Parliament who have an interest in the scheme, so that we can discuss with him the merits of the project?
Danny Alexander
A meeting would be better held with Ministers from the Department for Transport, who, I am sure, would be willing to agree to such a meeting.
Richard Harrington (Watford) (Con)
Will the Chief Secretary enlighten us as to the number of projects that were approved by the previous Government in the month before the general election?
Danny Alexander
A significant number of projects—with a significant cash value—were agreed in the last month before the election, and I will happily give the hon. Gentleman more details later.
Mr Kevan Jones (North Durham) (Lab)
I note from the right hon. Gentleman’s statement that a commitment has been given on crucial equipment for military operations in Afghanistan. However, can he confirm to the House today that he will also give a full commitment to the announcement that I made before the election on the £30 million for the Army’s recovery capabilities, the costs of the armed forces compensation scheme and the extension of the veterans mental health pilots?
Danny Alexander
As I said in my statement, Departments will make clear the projects that have been approved, but protecting spending on front-line services in the armed services and support for our troops on the front line in Afghanistan is a priority for this Government.
Mr David Burrowes (Enfield, Southgate) (Con)
Does not the shadow Chief Secretary’s delay in coming to the Chamber for today’s statement characterise the previous Government’s delay in taking the tough decisions that are needed, and did not his response characterise their refusal to say sorry for the mess that they left this country in?
Danny Alexander
The hon. Gentleman makes a good point, although I would not wish to cast aspersions on the shadow Chief Secretary’s reasons for the timing of his arrival in the Chamber. That would be discourteous. However, it is fair to say that a spending review was delayed by the previous Government because they did not want to face up to the fact that some difficult decisions had to be made.
Angela Smith (Penistone and Stocksbridge) (Lab)
The Sheffield Forgemasters loan would have helped place the UK at the forefront of global nuclear production and enabled Forgemasters to install the country’s first 15,000-tonne forging press, thus reducing our dependence on foreign imports. Is the Government’s decision not a political one, made out of spite because South Yorkshire voted Labour, rather than a decision based on the long-term interest of UK manufacturing?
Danny Alexander
No, none of the decisions was motivated in the way that the hon. Lady suggests. I have received representations from Members from a number of political parties on this matter. The key issues are affordability and value for money, and that project does not meet those tests. However, we continue to be supportive of it and officials will continue to work with the company to help it to try to secure private investment, which we think is perfectly justifiable for that worthwhile project.
Andrew Percy (Brigg and Goole) (Con)
In the run-up to the general election, Labour Ministers trotted up the M1 to my constituency to make all sorts of promises on issues that they had done nothing about for 13 years. Does the Chief Secretary agree that, instead of coming here and feigning anger today, Labour Members should walk out of that door and go to constituencies such as mine to apologise for raising people’s hopes about projects that they never intended to fund?
Danny Alexander
The hon. Gentleman is absolutely right. It is easy for people to write cheques when they know they are going to bounce. Labour raised hopes in communities that certain projects would go ahead, for which there simply is no money left. As the shadow Chief Secretary said, there is no money left, and that should have been the approach that guided those decisions, not the need of Members to save their own seats.
Mr Deputy Speaker
Order. Questions must be addressed—and the Minister must respond—not to the former Government, but to this Government and to today’s statement.
Mr Angus Brendan MacNeil (Na h-Eileanan an Iar) (SNP)
How much does this review bring into question private finance initiatives or public-private partnerships that, at their inception, had bogus public sector comparators and have cost the public purse a lot more over the period? Will the Chief Secretary also ensure that there is no threat to the service provided by search-and-rescue helicopters, despite the suspension of procurement for helicopters? That service is vital to island communities such as mine.
Danny Alexander
I will say two things to the hon. Gentleman. First, his point about PFI is not within the scope of this statement. However, in the context of the spending review, we will have to look at every single way in which public money is spent—including the operation of PFI—to ensure that we are getting value for money and not spending taxpayers’ money unnecessarily when the spending settlement is going to be so tight.
The hon. Gentleman will see, when he reads the statement in the Library, that the search-and-rescue helicopter replacement is one of projects whose cost-effectiveness will be reviewed by the Ministry of Defence and the Department for Transport. Obviously, they will produce their report as and when that process has been completed.
Duncan Hames (Chippenham) (LD)
In the light of the Chief Secretary to the Treasury’s statement and of the fact that this will be a fixed-term Parliament, will he introduce constraints to prevent a similar spending spree in the run-up to the next general election?
Danny Alexander
I am grateful to the hon. Gentleman for his question, and I understand the motivation behind it. Given the scale of the challenge that we face in the form of the enormous structural deficit and the need to bring down that deficit further and faster than the previous Government proposed, I suspect that that task will consume all our time in the Treasury over the next five years, without having to worry about the question that he has raised.
Bob Blackman (Harrow East) (Con)
In the run-up to the election, we could hardly move for Labour Ministers making all sorts of spending commitments. Will the Chief Secretary tell us how many of them were subjected to value-for-money tests?
Danny Alexander
Having found the piece of paper that I was looking for earlier, I can tell the hon. Gentleman that a substantial number of those projects were agreed to very close to the election. In the week before the election was called, the Kent Thameside strategic transport programme was agreed, as were the Birmingham magistrates court programme, the Outukumpu project, Building Schools for the Future in Cumbria and the Sheffield retail quarter. That was all done in that one week before the election.
Derek Twigg (Halton) (Lab)
The Chief Secretary has made a serious accusation in saying that Labour Ministers deliberately agreed expenditure or programmes of action that were not properly funded. If that were the case, the permanent secretary would have asked for a ministerial letter of direction. Will he place before the House the ministerial letters of direction for all the projects that he has referred to?
Danny Alexander
Having looked at the state of the books and seen the plans that the previous Government set out—at least in headline terms—to cut £50 billion from public spending over the course of this Parliament, I do not see how any Minister could responsibly have made those spending commitments and expected them all to be met after the election.
Robert Halfon (Harlow) (Con)
Is the Minister aware that, under the previous Government, the Department for Communities and Local Government spent £134,000 on luxury sofas? Is not that an example of the obscene waste that has led to the tough decisions that we have to make today?
Danny Alexander
I was not aware of that Department’s spending on luxury sofas—perhaps I should have been. It is precisely that kind of expenditure on which we need to bear down heavily in the context of the spending review and through the efficiency and reform group that we have established, to ensure the maximum amount of space in Departments’ budgets to spend on the front-line services that Members on both sides of the House care about.
Mr Dave Watts (St Helens North) (Lab)
Can I try to get a straight answer to a straight question? What assessment has been made of the impact of this announcement on jobs and growth, and will the Chief Secretary publish that assessment and put it in the Library?
Danny Alexander
The position on that is as I set out to the shadow Chief Secretary: the biggest risk to jobs and growth in this country is failing to take appropriate action to deal with the deficit. That is the context of this Government’s policy. If we continued with the irresponsible habits of the previous Government, we would soon be in a great deal worse a position than the one in which we now find ourselves.
Angie Bray (Ealing Central and Acton) (Con)
Does my right hon. Friend agree that job losses are the tragic consequence of 13 years of misgovernment and massive overspending?
Danny Alexander
That is at least partly the case. The challenge that we now face is how to tackle the fundamental economic problems that this country faces. The most serious economic challenge that we face is the scale of the deficit. We have seen in countries elsewhere in Europe and further afield the consequences of failing to act on fiscal consolidation. If we fail to act, the problems for jobs and growth and the prospects for our economy will be a great deal worse than they are today.
Mr Denis MacShane (Rotherham) (Lab)
In 1979, the then Government started destroying South Yorkshire’s industry, and the right hon. Gentleman is truly an heir of that Government. Does he realise that the name of liberal democracy must hang its head in shame in Sheffield, now that Sheffield Forgemasters has no future? His right hon. Friend the Deputy Prime Minister can now send back his Independent Parliamentary Standards Authority travel allowances, because he will never be welcome in Sheffield or South Yorkshire again.
Danny Alexander
I would say two things to the right hon. Gentleman. If he looks at the programmes in the Department for Business, Innovation and Skills, he will see that a number of grants to industry have been approved, having been judged on the tests of value for money and affordability. Also, as the Government make progress over the next few months and years, he will see that protecting areas that are particularly dependent on the public sector and that have been disproportionately affected will be a key priority for us.
Mr Aidan Burley (Cannock Chase) (Con)
Which individual project was my right hon. Friend most surprised to see had been given the go-ahead?
Danny Alexander
It would be invidious to choose between some of the projects on the list. I realise that each of the decisions has difficult consequences for the communities affected. My surprise is not at an individual project but at the general approach to spending that was taken in the run-up to the general election.
John Woodcock (Barrow and Furness) (Lab/Co-op)
In the light of the bizarre suspension of the successor deterrent programme, will the Chief Secretary tell us whether the Trident value-for-money review will consider the overall question of whether the successor to Trident remains the most effective form of deterrent?
Danny Alexander
The hon. Gentleman has no doubt studied carefully the coalition programme for government, and he will know that we have agreed to proceed with the successor deterrent to Trident. The value-for-money review will do precisely what it says on the tin: we want to get the best value for money from the project and not waste taxpayers’ money unnecessarily on the renewal.
Penny Mordaunt (Portsmouth North) (Con)
I was surprised, but glad, to hear that Treasury staff have been able to help the shadow Chief Secretary to the Treasury to review the projects mentioned in the statement. It is a shame that he did not do that while he was in office. Will the Chief Secretary consider seconding some of his staff—if he can spare them—to help to educate Labour Members and to get them on the same page as the rest of the country, given the state that they have left the economy in?
Danny Alexander
I agree with the hon. Lady that the people of this country are ahead of the Labour party in realising the seriousness of the economic problems that we face. That consensus is now a global one—people will have seen the statement from the G20 summit on the need for faster fiscal consolidation. That is right, and the Opposition are wrong.
Mr Deputy Speaker
Order. I remind Members to try to keep to the subject of the statement; the Minister is not responsible for previous Government policies.
Fiona Mactaggart (Slough) (Lab)
If the Chief Secretary thinks that the biggest risk to jobs is the deficit, why does Britain have a better employment rate among all other European countries than America?
Danny Alexander
The risk that we face is the fact that we have the largest budget deficit in the EU, with the exception of Ireland, that we have a very substantial structural deficit and that growth is lower than forecast. All those things argue for what we are going to do, which is implement a programme to reduce the deficit faster and further than the previous Government proposed. That is the only responsible course to take; profligate spending of the sort we saw in the final days of the previous Government is not responsible.
Alec Shelbrooke (Elmet and Rothwell) (Con)
Does my right hon. Friend agree with me that, after their cynical attempts to buy the last election, the crocodile tears of Labour Members do nothing to raise the standing of this House in the public’s eyes?
Danny Alexander
I share the hon. Gentleman’s hopes for higher standards in Parliament, but Ministers of the previous Government ought to have known in the context of the financial situation that the country faces and of their own plans to cut £50 billion from public spending that these additional spending commitments and claims on the reserve were simply unaffordable. That chicken is coming home to roost today.
Michael Connarty (Linlithgow and East Falkirk) (Lab)
I note that £1.2 billion-worth of the cancelled projects, as they are called, are from the future jobs fund—for the young people of the right hon. Gentleman’s constituency and mine. I wonder what the consequences will be for the Scottish budget. Can he tell us what impact there will be on my constituents in Scotland, or have his Conservative bosses—let us be quite frank—done a deal with the tartan Tories in the SNP in Scotland?
Danny Alexander
The hon. Gentleman will know that benefit and Department for Work and Pensions spending is a reserved matter, so does not have a Barnett consequential. He will also know that the Government have set out plans to establish a Work programme, which will replace those programmes during next year. That will be a more targeted, quicker and effective programme, based on paying suppliers by results to ensure that people get back into work quickly. I welcome that programme and I hope that he will, too.
Mr Rob Wilson (Reading East) (Con)
Can the Chief Secretary confirm the good news for Reading and for my constituents—that the Government are fully committed to the Reading station upgrade, because it offers excellent value for money?
Danny Alexander
I have heard what the hon. Gentleman has said. It will be for the Department for Transport to announce the details of projects that have been approved.
Pat Glass (North West Durham) (Lab)
I and the people whom I represent will be desperately disappointed that the new North Tees hospital is not going ahead. My understanding is that it was not promised in the last weeks before the election, but had been planned, committed to and expected for five years. The decision will have a massive impact on the Tees area, Cleveland and Durham. The hospital was to provide specialist services for the whole of that area. How does that sit with the promises made by Government Members not to cut health spending?
Danny Alexander
The hon. Lady will know that it is a foundation trust which is coming to the Government for additional funding. She may not be aware, however, that consent for the project was given on 10 March 2010, so it is within this period. Of course I accept that the decision will be very disappointing for people who have worked on the project for that time—I do not wish to belittle that at all—but in the context of the economic situation that we face and the decisions that we have to make, it is right and proper to judge such projects on the strict value-for-money and affordability grounds that we have applied.
Mr Philip Hollobone (Kettering) (Con)
Which factors convinced the Chief Secretary to cancel the local authority business growth incentives scheme?
Danny Alexander
It was the fact that there is no substantive evidence that it has had any effect on doing the job that it was supposed to do or set out to do—to encourage local authorities to work with business.
Alex Cunningham (Stockton North) (Lab)
We have already heard from the new Prime Minister that the north-east of England can expect to suffer hardest from the cuts, so I want to know precisely why the North Tees and Hartlepool NHS Foundation Trust hospital, which is in my constituency, is not going ahead, particularly as we have seen tremendous progress in reducing health inequalities in my area, and that hospital was going to complete the job.
Danny Alexander
In the context of tighter budgets, it is essential that all major hospital buildings must be affordable and provide value for money. On that basis, the Government decided not to proceed with that scheme. It was assessed against a number of other major build projects that were at the same stage of development; those schemes are more urgent. The hon. Gentleman will be aware that the previous Government set out plans to halve capital spending over the next few years. We have to make judgments about capital spending in the context of budgets that are a great deal tighter. I appreciate that that is disappointing, and I do not wish in any way to belittle the point that the hon. Gentleman is making quite fairly on behalf of his constituents, but in judging these things we have to apply the value-for-money criteria as we have.
Phil Wilson (Sedgefield) (Lab)
During the general election campaign, the Prime Minister said that any Minister who went to him to propose front-line cuts would be sent back to the drawing-board, so may I suggest that the Minister goes back to the drawing-board, because that is exactly what he is doing? The people of the north-east, in Teesside and south Durham, want the Hartlepool and North Tees hospital, which has been under development for five years and is clinically-led but has been cancelled. On 6 May, people might have voted for the Liberal Democrats because they thought they stood for something; today they know that they do not.
Danny Alexander
I understand the hon. Gentleman’s concerns on behalf of his constituents, but the anger should be directed at Labour Front Benchers, who irresponsibly agreed to spend money that, as the former Chief Secretary said in his letter, simply is not there.
Mr Phil Woolas (Oldham East and Saddleworth) (Lab)
I ask the right hon. Gentleman to look again at his decision on Sheffield Forgemasters. That £80 million, which is spread over some years, is in the form of a loan and has a huge multiplier effect for the nuclear industry, particularly in the north-west. Is he trying to make sure that if the expansion of the nuclear industry takes place, which I hope it does, the infrastructure for it will have to come from overseas? Will he look at this again, because he is doing what he has accused the banks of doing—not providing loans for investment?
Danny Alexander
I have looked very carefully at this and all the projects that we are cancelling or suspending. I believe that the decision that we have made is the right one on value-for-money and affordability grounds. I have discussed it with my right hon. Friend the Secretary of State for Business, Innovation and Skills. In the context of the pressures on budgets and the affordability and value-for-money criteria that we have applied, I am afraid I am not able to go back and reconsider. Officials from the Department for Business, Innovation and Skills will work with the company to try to ensure that it gets access to a private sector solution. As to the nuclear industry, the hon. Gentleman will know that the coalition agreement commits us to no public subsidy for nuclear power.
Helen Goodman (Bishop Auckland) (Lab)
This afternoon, the Chief Secretary has taken a further £1 billion out of the Department for Work and Pensions and the fact that one of the cuts is to the young person’s guarantee demonstrates how empty is the Government’s rhetoric about being concerned about the vulnerable. Moreover, both the Tories and the Liberals voted with the Government for the legislation in March that provided for the two-year jobseeker’s guarantee. How can the Chief Secretary defend saying one thing in March and another thing today?
Danny Alexander
Well, there is no money left. The more important point is that we are cancelling programmes that we believe are ineffective and replacing them with the Work programme, which will start during next year and will be more effective at helping people who need help to get back into work quickly. That is an objective that we share; I believe our programme will be more effective in doing that. The hon. Lady will know that in the £6.2 billion announcement that we made a few weeks ago, one of the areas to which money was recycled was additional funding for 50,000 more apprenticeships. That is valuable additional support to help young people find jobs now.
Alok Sharma (Reading West) (Con)
Will the Chief Secretary remind us once again why we face such a difficult spending review? It is clearly something that the Labour party has failed to understand.
Danny Alexander
As I said earlier, the reason we face such a tough spending round is the overriding need to bring our deficit down further and faster than was planned by the previous Government. That is necessary to restore confidence in our economy and restore balance to our public finances. It is the overriding priority, and it will restore jobs and growth in this country faster than the last Government would have managed.
Paul Blomfield (Sheffield Central) (Lab)
I wonder whether I can help the Chief Secretary by providing the answer that he failed to provide in response to an earlier question about value for money. Will he acknowledge that over the three years for which the Sheffield Forgemasters loan was under consideration, the Treasury conducted an extremely robust value-for-money exercise? This Government talk a great deal about consultation, but before the statement I spoke to the chairman of Sheffield Forgemasters, who confirmed that over the period of the Government’s review there has been no contact whatever with the company. Will the Chief Secretary confirm that fact?
Danny Alexander
What I can confirm to the hon. Gentleman is that we have applied value-for-money grounds to this as to all the other projects. With a restricted budget, however, we must make choices about where we can spend money, and unfortunately we simply cannot afford to provide funds for this project any longer. As I have said, officials from the Department for Business, Innovation and Skills will continue to work with the company in helping to find a private sector solution to the challenge.
Chris Heaton-Harris (Daventry) (Con)
Will the Chief Secretary remind the House of the size of the structural deficit, and perhaps remind Opposition Members that these are Labour cuts caused by the state in which the last Government left the country’s finances?
Danny Alexander
That is not a matter for my judgment; it is a matter for the judgment of the independent Office for Budget Responsibility, which we established to restore independence to the statistics on which budget judgments are based. According to the OBR, the structural deficit has risen to 8%, while the overall deficit is £155 billion. That is a vast sum. If we are to restore health to our economy we must narrow that gap, and do so quickly.
Mark Lazarowicz (Edinburgh North and Leith) (Lab/Co-op)
When the cuts that the Chief Secretary has announced today—which his boss will no doubt announce again on Tuesday—lead to lower growth, higher unemployment and the collapse of the construction industry, with consequential reductions in the Government’s revenue and increases in their benefit bills and, as a result, an increase in the deficit, what will he cut next?
Danny Alexander
I think that what the hon. Gentleman and, if I may say so, many Opposition Members fail to recognise is that the country faces a choice: a choice between taking the robust action which is needed and which we will take to bring responsibility to the public finances and reduce the deficit, and failing to take that action. The risk posed by the latter course is clear from what has happened in other countries. I believe that the action that we are taking today, and will no doubt take in future weeks and months, is necessary to ensure that in future we have the jobs and growth that we need.
Clive Efford (Eltham) (Lab)
Before his right hon. Friend the Member for Yeovil (Mr Laws) wrote the Chief Secretary his “Carry On Cutting Regardless” letter, he came to the House and told Members that he had been advised that the future jobs fund element of the young person’s guarantee did not provide value for money. The former Secretary of State for Work and Pensions, my right hon. Friend the Member for Normanton, Pontefract and Castleford (Yvette Cooper), said that that conflicted with what she had been told when in office. Will the Chief Secretary now publish both sets of advice and place them in the Library of the House so that Members can make up their own minds about who is telling the truth?
Danny Alexander
What I know is that according to the Department for Work and Pensions the programme provides poor value for money, and that the Work programme with which we will replace it next year will give better, more targeted, quicker and more effective support to the people who are most in need. It will do what I hope every Member wants, and help those people to return to work.
Toby Perkins (Chesterfield) (Lab)
In the days when the Liberal Democrats were in a separate party from the Conservatives, did they not say in their campaign that they would not make cuts this year and pull the rug from under the feet of the economic recovery? Did the right hon. Member for Sheffield, Hallam (Mr Clegg) make any representations to the Chief Secretary about Sheffield Forgemasters, and when he stood for election did he make his constituents in Sheffield aware that a vote for the Liberal Democrats would lead to hundreds more people in Sheffield losing their jobs?
Danny Alexander
The hon. Gentleman has asked about four questions in one. I will answer the first. As he knows, the risks facing the country have changed over the past few months. Any survey of the evidence across the world suggests that the risks of sovereign debt crises are huge in other countries. That is reflected in the G20 communiqué, which agreed that faster fiscal consolidation was what was needed in major economies. I think that that is right. Only the Labour party is out of step with that international consensus.
Mr Chuka Umunna (Streatham) (Lab)
Again and again, the Chief Secretary, his predecessor and the Secretary of State for Work and Pensions come to the House and assert that the future jobs fund is an ineffective scheme. How can the Chief Secretary say that when the Department for Work and Pensions has not collected the data concerned? The first cohort of young people to take part in the scheme have only just finished, and the data are not yet available.
Danny Alexander
According to my information, the programme represents poor value for money and is not delivering on the objectives set out for it, and our Work programme—which the Secretary of State for Work and Pensions will be announcing—will give people a more effective, quicker and more direct route back into work by paying providers by results, and ensuring that people receive the support that they need.
Gavin Williamson (South Staffordshire) (Con)
Has my right hon. Friend received one piece of slightly useful advice from Labour Members about how to sort out the mess that they created?
Catherine McKinnell (Newcastle upon Tyne North) (Lab)
This morning, when I asked the Under-Secretary of State for Transport, the hon. Member for Lewes (Norman Baker), for clarification of the Government’s commitment to funding for the reinvigoration of the Tyne and Wear metro, I was told to wait for the statement from the Chief Secretary to the Treasury. Unfortunately, his statement has made it no clearer to the people of Tyne and Wear whether that vital transport infrastructure will be given the investment that it needs in order to survive—investment that has not been made for 30 years—or whether it will be left to die on its feet.
Danny Alexander
The Department for Transport will be in a position to provide clarity on the approvals that it has. I suggest that the hon. Lady redirect her inquiries to that Department.
Chi Onwurah (Newcastle upon Tyne Central) (Lab)
On 11 March, the Deputy Prime Minister came to Newcastle and announced an investment of half a billion pounds in wind power in the north-east. Does the fact that that project is not included in the list of cuts in industry, jobs and front-line hospitals mean that it is going ahead, or was it never intended to proceed in the first place?
Danny Alexander
The last Government announced a project for a competition in the area. It is still undergoing a process with the European Union involving state aid, approval and so forth. I shall not be in a position to offer approval or otherwise until that process has been completed, but once it has been completed, we shall be able to make an announcement.
Banking Reform
(13 years, 10 months ago)
Commons ChamberRead Full debate Read Hansard Text Read Debate Ministerial Extracts
The Financial Secretary to the Treasury (Mr Mark Hoban)
With permission, Mr Speaker, I shall make a statement about the Government’s plans to reform the institutional framework for financial regulation.
The tripartite system of financial regulation failed spectacularly in its mission to ensure financial stability, and that failure cost the economy billions. The British people rightly ask how this Government will stop it happening again. That is why our coalition agreement committed us to reforming the regulatory system for financial services in order to avoid a repeat of the financial crisis. Let me now set out in detail the changes to the regulatory architecture that will make that possible.
At the heart of the banking crisis was a rapid and unsustainable increase in debt. Our macro-economic and regulatory system utterly failed to identify correctly the risk that that posed, let alone prevent it. No one was controlling levels of debt, and when the crunch came, no one knew who was in charge. For that reason, we need a macro-prudential regulator with a more systematic and detailed knowledge of what is happening not only in individual firms, but across the financial system as a whole.
Only central banks have the broad macro-economic understanding and understanding of markets, the authority and the knowledge required to make macro-prudential judgments. We will therefore place the Bank of England in charge of macro-prudential regulation by establishing within the Bank a Financial Policy Committee. We will also create two new, focused regulators: a new prudential regulator under the Bank of England, headed by a new deputy governor, and a new Consumer Protection and Markets Authority. All the new bodies will be accountable to Parliament, and their remit will be clear so that never again can someone ask who is in charge and get no answer.
First, we will legislate to create the Financial Policy Committee in the Bank of England. It will have the responsibility to look across the economy at the macro-economic and financial issues that may threaten stability, and it will be given the tools to address the risks it identifies. It will have the power to require the new Prudential Regulation Authority to implement its directions by taking regulatory action with respect to all firms.
The FPC will be accountable to Parliament in two ways: directly, as is the case with the Monetary Policy Committee; and indirectly, through its accountability to the Bank’s court of directors. The Governor will chair the new committee. Its membership will include the deputy governors for monetary policy and financial stability, the new deputy governor for prudential regulation and the chair of the new Consumer Protection and Markets Authority, as well as external representatives and a Treasury representative. An interim FPC will be set up by the autumn, in advance of this legislation.
Secondly, we will create a Prudential Regulation Authority as a subsidiary of the Bank of England. It will conduct prudential regulation of sectors such as deposit-takers, insurers and investment banks. The PRA will be chaired by the Governor of the Bank of England, and the new deputy governor for prudential regulation will be the chief executive. The deputy governor for financial stability will also sit on the PRA board.
Thirdly, a new Consumer Protection and Markets Authority will take on the Financial Services Authority’s responsibility for consumer protection and conduct regulation. The CPMA will regulate the conduct of all firms, both retail and wholesale, including those prudentially regulated by the PRA, and will take a strong proactive role as a consumer champion. It will have a strong mandate for ensuring that financial services and markets are transparent in their operation, so that everyone—from someone buying car insurance to a trader at a large bank—can have confidence in their dealings and know that they will get the protection they need if something goes wrong.
The CPMA will regulate the conduct of every financial services business, whether they trade on the high street or trade in high finance. We need to ensure that this body has a tougher, more proactive approach to regulating conduct, and its primary objective will be promoting confidence in financial services and markets. The CPMA will maintain the FSA’s existing responsibility for the Financial Ombudsman Service and oversee the newly created Consumer Financial Education Body, which will play a key role in improving financial capability. The CPMA will also have responsibility for the Financial Services Compensation Scheme, but given the important role the scheme plays in crises, it will work closely with the FPC and PRA. We will also fulfil the commitment in the coalition agreement to create a single agency to take on the work of tackling serious economic crime, which is currently dispersed across a number of Government Departments and agencies. Before we set up these new bodies in their permanent form, we will conduct a full and comprehensive consultation, and we will publish a detailed policy document for public consultation before the summer recess.
Our goal is radically to improve financial regulation in the UK, strengthening the prudential regime by placing it in the Bank of England and delivering the best possible protection for consumers. During the period of transition to the new regime, the Government will also be guided by the following four principles: minimising uncertainty and transitional costs for firms; maintaining high-quality, focused regulation during the transition; balancing swift implementation with proper scrutiny and consultation; and providing as much clarity and certainty as possible for the FSA, Bank and other staff affected during the transition. In order to do that, we will ensure the passage of the necessary primary legislation within two years.
I am delighted that Hector Sants, the current chief executive officer of the FSA, has agreed to stay on to lead transition and become the chief executive of the PRA. He will be supported in his work by Andrew Bailey from the Bank of England, who will become the deputy in the new PRA. This is a strong team to ensure a smooth transition.
We all know that the financial crisis has cost taxpayers dearly. The regulatory system needs radical reform to make the sector more stable and stronger. The last Government could not do that because they were caught up in a structure designed by the former Chancellor and Prime Minister. The fundamental flaws in that architecture contributed to the failure in the banking sector and ultimately undermined economic stability. The continuing financial and economic uncertainty across the eurozone strengthens the urgency with which we must equip ourselves with better tools and arrangements to tackle any future financial instability.
We have already paid a high price for the previous Government’s failings. We must do all we can to prevent this from happening again, and I commend this statement to the House.
Mr Gareth Thomas (Harrow West) (Lab/Co-op)
May I thank the Financial Secretary for advance sight of his statement, and as this is, I think, his first outing in his new role, may I congratulate him and welcome him to his post—and, indeed, wish him well?
While no one can dispute that a failure to regulate effectively was at the heart of the global financial crisis, the key failure by regulators in monitoring agencies and central banks across the globe was in understanding the growing systemic risks in financial services. We also should not overlook the failure in bank boardrooms to understand what was going on. This was not just an issue in the UK. Does the Financial Secretary accept that in some countries the central bank had prime responsibility for regulation, whereas in others, including ours, responsibility has been shared, and in our case between the Bank, the FSA and the Treasury, and that the Bank has always had responsibilities for financial stability?
Specifically, who will appoint the new Financial Policy Committee? Will individual members have their own vote, or will that be merely advisory to the Governor? Will FPC minutes be published, and will the Governor or the chief executive of the PRA ultimately be responsible for the decision on whether to act? Does the Financial Secretary also accept that there will be concern—not least among those who were victims of the Bank of Credit and Commerce International, of which my right hon. Friend the Member for Leicester East (Keith Vaz) has consistently reminded the House—about the record of the Bank of England in financial services supervision, and will he now consider publishing part two of the Bingham Report?
Will the Financial Secretary not acknowledge too that the Financial Services Authority today is a vastly different regulator from the FSA of 2007—as, indeed, the Treasury Committee has acknowledged? Will he acknowledge that a significant level of better trained new staff and the new activism of the FSA in its supervisory role has led to a bolder, more vigorous approach to financial services regulation in recent times?
How, in practice, will the Financial Secretary avoid the very real risk of a loss of energy as regulators now focus on their own future, given that there continues to be considerable uncertainty and instability in global financial markets? Specifically, can he clarify who will be responsible for supervision and regulation before 2012, and will he acknowledge the profound risk, given the proliferation of new bodies he has announced, of ongoing regulatory confusion—of issues falling between the cracks? Indeed, is it not right that there will now be effectively two different regulators for many financial firms?
I was surprised by the absence of any reference to the Banking Commission in the statement. Does the Financial Secretary not accept that proposals to break up banks would not have made any difference to Northern Rock, a retail bank, or Lehman Brothers, an investment bank, and that what is needed is increased capital held by banks and living wills to manage the possibility of future banking problems? Will he explain how the deliberations of this commission on a possible break-up of British banks, such as Barclays or HSBC, can be conducted in a way that reassures the markets and does not exacerbate financial instability?
Does the Financial Secretary recognise that the financial services industry employs over 1 million people and remains crucial to our economic future? Will he ensure that, whatever proposals he accepts—if, indeed, he does accept any from the commission—we do not put ourselves at a commercial disadvantage compared with other countries? Specifically, how will the proposals announced today impact on remuneration, and what ongoing effort is there to secure international agreement on banking levies again, so that Britain is not at a competitive disadvantage?
Is it not the case that while the work of each of the new bodies and the commission will be worthy of serious scrutiny on their own merits, as the shadow Chancellor, my right hon. Friend the Member for Edinburgh South West (Mr Darling), said yesterday, the Government risk creating a system that injects more, not less, uncertainty into the City? While the architecture of the regulatory system is clearly important, is it not the skills and judgment of individual regulators that matter most at the moment? Surely, it is not where they sit; it is what they do.
Mr Hoban
I welcome the hon. Gentleman to his new role and I am grateful to him for his welcome to me. Although I listened very carefully to his remarks, I am not quite sure whether the Opposition accept our proposals or whether they are stuck in the past defending to the last the former Government’s regulatory architecture, which they put in place in 1997. It is time that the Opposition faced up to this problem: do they accept that the system put in place by the right hon. Member for Kirkcaldy and Cowdenbeath (Mr Brown) was flawed and needs reform, or are they the last people to defend the status quo in this country?
The hon. Gentleman asked a number of detailed questions. Let me address them. He recognised the build-up of systemic risk in the economy over the course of the past 13 years, but he must acknowledge that the reforms introduced by his right hon. Friend in 1997 took away from the Bank of England the power to monitor and respond to those risks.
The hon. Gentleman asked about the appointments to the Financial Policy Committee, and they will be consistent with the approach currently adopted towards the Monetary Policy Committee. He referred to the Bingham report and the collapse of BCCI and, as he will remember from the exchange between the right hon. Member for Edinburgh South West (Mr Darling) and my right hon. Friend the Chancellor yesterday, the Chancellor is going to look into that matter.
The hon. Gentleman is right to say that the FSA has made progress, and that is one reason why we are delighted that Hector Sants has agreed to lead the FSA through the transition period and then to become the chief executive of the PRA. No matter how far the FSA improves in the execution of its role, the reality is that the flawed architecture that the hon. Gentleman’s Government put in place undermines all that it does. This package of reforms ensures that we have the right regulatory architecture in place to identify and tackle the systemic risks to which he referred and ensures proper protection for consumers so that they will never again be let down.
Mr Andrew Tyrie (Chichester) (Con)
Is it not clear that if public money is to be put at risk during a financial crisis, the only person with the moral authority to take a decision will be the Chancellor of the Exchequer? Surely the Chancellor of the Exchequer should therefore have the power to assume the chairmanship of the Financial Policy Committee during a crisis. Will my hon. Friend confirm that that will be possible under the legislation that will be brought before the House?
Mr Michael Meacher (Oldham West and Royton) (Lab)
Since the direct causes of the financial crash were colossal bonuses that drove recklessness, the use of fancy structured investment vehicles including sub-prime mortgages, the conflict of interest whereby credit rating agencies and auditing companies are paid by the company that they are supposed to be assessing and, above all, the overly lax culture of light-touch regulation, what precise, specific mechanisms is the Financial Secretary putting in place to deal with each of those underlying problems as opposed to merely shifting around the institutional infrastructure, which is all he appears to be doing?
Mr Hoban
I am grateful to the right hon. Gentleman for his comments. He takes a close interest in these matters. Of course, he will remember that in 2006 the right hon. Member for Morley and Outwood (Ed Balls) praised the system of “increasingly light-touch” regulation and claimed that he had
“resisted pressures from commentators for a regulatory crackdown.”
The right hon. Member for Oldham West and Royton (Mr Meacher) ought to take up some of these historical issues with his own Front Benchers.
As regards a change to the regulatory approach, we need to see a move away from the prescriptive, box-ticking approach that we have seen in a recent years to a system in which the PRA and the CPMA can make more judgmental decisions about what is happening in the markets they supervise and with the prudential decisions that individual institutions are taking. If we put judgment at the heart of the system, we are more likely to avoid some of the issues that we have seen arise in recent years.
Karen Bradley (Staffordshire Moorlands) (Con)
May I warmly welcome the Minister to his role? Will he tell the House about conversations that he has had with international colleagues about the need for radical reform of the regulatory system and the failure of the last Government’s tripartite system?
Mr Hoban
I am grateful to my hon. Friend. There have been a number of conversations with other colleagues globally about the lessons to be learned from the financial crisis and from the regulatory structures. It is interesting to talk to people in other jurisdictions about their views. Christian Noyer, the governor of the Banque de France, said in July last year:
“Indeed, one of the main lessons of the crisis may be that those countries where central banks assume banking supervision took advantage of their ability to react quickly and flexibly to emergency situations.”
Others have expressed a similar view and that is why I think that the reforms we are announcing today are in the mainstream of reforms in financial regulation—a mainstream that the Opposition seem quite happy to stay outside, yet again.
Mr George Mudie (Leeds East) (Lab)
I welcome the evolution of financial regulation. I think that the present system was tested and found wanting, so the movement has to be welcomed. I want to press the Minister on the subject of the Banking Commission. It was interesting that he left it out of his statement and that worries me, because I note that it will take 18 months before it reports. If that is so, it will probably miss the Queen’s Speech for the following year, which suggests that it will be three or four years before we see legislation and the much-needed changes that will deal with the banks that caused the crisis. They continue to flaunt their behaviour on bonuses and have continued to hurt small business by not lending in the last two years. Urgent action is needed, so why is there this long timetable and why was this subject missing from his statement?
Mr Hoban
I am grateful to the hon. Gentleman for that question. He has been a distinguished member of the Select Committee on the Treasury and has taken part in many discussions in that Committee and in Public Bill Committees when we have explored some of these issues. I sense that he is much more engaged in the need for reform than his colleagues on the Front Bench.
The Banking Commission is important and it is vital that we ensure that we learn some of the lessons that arise from the structure of the UK banking system. We have a very concentrated banking structure and three out of the four principal banks in the UK are universal banks. We need to understand what risks flow from that and how best to tackle those risks, as well as considering the impact of competition in the banking sector. The appointment yesterday of Sir John Vickers as chairman of the commission has been greeted with warm applause across the business and consumer community. There are four other commissioners— Martin Wolf, Martin Taylor, Clare Spottiswoode and Bill Winters—who are equally distinguished in their own fields. The commission will provide the opportunity for a proper debate about the structure of banking in this county—a debate in which the former Prime Minister and former Chancellor did not want to participate. We think that it is time to have that debate and when we have had it, that will help remove the uncertainty about the structure of banking in the UK.
Mr Deputy Speaker
Order. Before I take the next question, may I ask for short questions and succinct answers? That will help everybody to get in.
Tracey Crouch (Chatham and Aylesford) (Con)
I welcome the Minister’s statement on these much-needed reforms. Will he tell the House how the reforms set out today will affect the insurance sector, which shares the same regulatory regime as the banks but clearly operates very differently?
Mr Hoban
My hon. Friend makes a good point about the role of insurance. In this crisis, we must ensure that we distinguish between what has happened to the banking sector and the relative success of the insurance sector in withstanding the storms of this crisis. It is an important sector to the UK economy and a huge wealth generator. We need to ensure that the insurance sector, when it comes within the remit of the PRA, has the right sort of prudential regulation that recognises its strengths and challenges. It will of course be regulated as regards its relationship with consumers by the CPMA.
Nia Griffith (Llanelli) (Lab)
The people of this country want to see a bit of humility and payback on the part of the banks. One opportunity to do that would be through the so-called Robin Hood tax on banking transactions, with the money going to alleviate poverty here and to tackle climate change across the globe. Will the Financial Secretary urge his right hon. Friend the Chancellor to introduce such a tax and to influence colleagues worldwide to do likewise?
Sajid Javid (Bromsgrove) (Con)
I welcome the Minister to his new role. Does he agree that these banking reforms will help to boost confidence in the British economy once they are enacted? That will help to keep interest rates lower for longer, boost investment and create jobs.
Mr Hoban
I am grateful for my hon. Friend’s question. It is important to ensure that businesses have confidence that where macro-prudential threats arise in future, action will be taken to resolve them. They did not have that confidence in the previous regime and I hope that they will have that confidence following the reforms that we have put forward today.
Jonathan Edwards (Carmarthen East and Dinefwr) (PC)
Economic growth in the past decade was driven largely by consumption. As a consequence, £1.4 trillion-worth of personal debt is circulating in the UK economy, which means that the human cost of the current recession will be particularly severe. Will the new Consumer Protection and Markets Authority make sure that lenders have to undertake affordability audits so that individuals and families incur only debts that they can service?
Mr Hoban
The hon. Gentleman is right to pick up on this issue. One of the big challenges is ensuring that consumers are properly equipped to understand their borrowing and saving needs, and the Consumer Financial Education Body has a key role to play in improving financial capability in order to help people to make the right decisions. Also, there is an obligation on industry to make sure that it provides consumers with the best advice possible to help them to make the right decisions.
Harriett Baldwin (West Worcestershire) (Con)
I very much welcome that direction of travel, just as I welcomed the decision of the right hon. Member for Kirkcaldy and Cowdenbeath (Mr Brown), in 1997, to set the Bank of England free to make decisions on interest rates. Will the Minister clarify whether the Financial Policy Committee will publish its minutes openly and on a regular basis, and how it will deal with a situation in which it is concerned about a specific institution?
Mr Hoban
It is important that the Financial Policy Committee is transparent in its dealings. It is a great strength of the Monetary Policy Committee that it is transparent and that it can be held to account by the public for its decisions. We need to ensure that similar arrangements are put in place for the FPC—while respecting, as my hon. Friend has pointed out, the confidentiality of individual firms.
Mr Philip Hollobone (Kettering) (Con)
Will one of the new organisations under the Bank of England, the Office for Budget Responsibility or someone else alert the Treasury if the housing market starts to get overheated again?
Mr Hoban
One of the roles of the Financial Policy Committee is to identify threats to financial stability as they emerge. I would expect the FPC, in its work of looking at overall trends in the economy, to identify that sort of risk and to make it known not just to the Treasury, but to the wider public through its regular reports.
Clive Efford (Eltham) (Lab)
Will the hon. Gentleman say how many people at the FSA and at the Bank of England currently earn more than the Prime Minister? Does he intend to apply the policy in the coalition document? If he decides to pay above the rate of the Prime Minister’s salary, should that element of the pay be performance-related, given the gravity of the decisions that such people will be taking?
Mr Hoban
There is an issue about pay levels, which we will need to look at. I am intrigued by the hon. Gentleman’s suggestion that there should be a greater variable element in relation to performance, given that a critique of many is that an excessive bonus culture in the City contributed to the financial crisis.
Bob Blackman (Harrow East) (Con)
Will the Minister please explain how today’s announcements will end the confusion in the markets and make sure that there is proper focus on regulation to end that confusion?
Mr Hoban
The package that we have set out today, which was greeted with a great deal of support last night when the Chancellor outlined it to the City, ends any uncertainty. The transition process that we have outlined today in relation to legislation, and the team led by Hector Sants, the current chief executive officer of the FSA, will reassure the City about the direction of travel on regulatory reform. The new settlement, which takes into account macro-prudential supervision, micro-prudential supervision and effective consumer supervision, will ensure that we have the right package of regulatory structures in future to safeguard the economy and to give confidence to consumers and others in the markets.
Mr Kevan Jones (North Durham) (Lab)
I welcome the Minister to his new position. I know that County Durham will be proud as he is a son of Country Durham. Has he given any advice to the regulator on the position of non-executive directors on banks’ boards, particularly regarding their role, remuneration and qualifications? He will know that one problem with Northern Rock was the fact that the non-executive chair’s only qualification appears to have been that he was a member of the Ridley family—he inherited it from his father.
Mr Hoban
The hon. Gentleman makes an important point about the qualifications of non-executive directors. That is why the FSA has already instituted a process of interviewing senior members of staff and directors, before their appointment to boards or positions of responsibility, to ensure that the qualifications and experience that they bring to those important roles is checked.
Geraint Davies (Swansea West) (Lab/Co-op)
Is the Minister seriously contending that had these arrangements already been in place, the financial crisis would not have occurred? If he is not making that absurd suggestion, will he accept that he cannot promise that such a financial crisis will not occur again with these arrangements in place?
Mr Hoban
It is clear that if the Bank of England had not lost its power to monitor and act upon the level of debt in the economy, it might have been in a position to consider what was happening in the housing market, to consider the role that Northern Rock played in fuelling the asset-price bubble and to take action to cool that down. The only person who tried to rule out boom and bust in the past was the right hon. Member for Kirkcaldy and Cowdenbeath.
Alok Sharma (Reading West) (Con)
Does my hon. Friend agree with the Governor of the Bank of England’s assessment that there was little real reform of banking regulation under the last Government, and that the Opposition should therefore welcome the measures that we are setting out today?
Mr Hoban
I hope that the Opposition will welcome the measures, but their views were not very clear from what the shadow Treasury spokesman said. In the past three or four years, when we have debated the reform of parts of the banking regulation sector, the problem has been that the then Government were unable to engage in the fundamental debate about whether the architecture was right. They failed to address that question, and that led to a new Government addressing that question and putting things right for the first time.
Steve Rotheram (Liverpool, Walton) (Lab)
Will the Minister invite hon. and right hon. Members who are interested in the future of Liverpool football club to a meeting with RBS officials fully to scrutinise the deal that props up its leveraged buy-out by two American business men?
Amber Rudd (Hastings and Rye) (Con)
Given the global nature of banking, will the Minister advise us on how regulation will proceed on an international basis, bearing in mind the need to maintain as many jobs as possible in this country?
Mr Hoban
It is important to make sure that debates on regulation are co-ordinated at the global level, and my right hon. Friends the Chancellor of the Exchequer and the Prime Minister take an active role in those debates in the G20. I have recently taken part in ECOFIN’s summit, at which we discussed new supervisory arrangements in Europe. I am absolutely certain that we will engage in the debate both in Europe and globally to ensure that the structure of regulation supervision going forward is right to make sure that the system is stable and to ensure that decisions that have a fiscal impact are taken here, by UK regulators, and not in Europe.
Chi Onwurah (Newcastle upon Tyne Central) (Lab)
I will accept that the banking reforms will make it more likely that if exactly the same problems happened in exactly the same way in exactly the same countries, we might be able to spot them, if not to do anything about them. Does the Minister accept that by failing to address the institutional failures in the banking system that are outside regulation—such as pay incentives within banking, the role of the rating agencies, the failure of international information flows and the lack of transaction costs in international financial markets—our country is just as vulnerable as ever to banking failures?
Mr Hoban
I do not agree with the hon. Lady. The package of reforms makes a significant improvement to the regulatory architecture in the UK, and there is further work that we can do at the European and the global level to make it more effective. She is right, in part, to say that institutions need to change their behaviour. We need to look at the structure of banking, which is why we will set up the Banking Commission that the Chancellor announced yesterday. Those reforms will help to improve structure, but let us look at what is important. Let us get the architecture right in this country, let us remedy the flawed system that her party’s Government introduced in 1997 and let us ensure that the Bank of England has the tools to do the job. That will make a significant contribution to improving financial stability.
Point of Order
(13 years, 10 months ago)
Commons ChamberRead Full debate Read Hansard Text
Mr Kevan Jones (North Durham) (Lab)
On a point of order, Mr Deputy Speaker. In the Financial Secretary’s address to the House today, he made the accusation that Labour Ministers, possibly including myself, made spending commitments that were not funded. My hon. Friend the Member for Halton (Derek Twigg) made the point that, if that was the case, I and other Ministers would have had to send a letter to the accounting officer—that is to say, the permanent secretary in the Department. Could you use your offices to request that those letters be produced, to go against the accusation that has been made today?
Mr Deputy Speaker (Mr Lindsay Hoyle)
That is not a matter for the Chair, as the hon. Member well knows, but he has certainly got his point on the record and I am sure that everybody has taken on board his comments.
Building a High-Skilled Economy
(13 years, 10 months ago)
Commons ChamberRead Full debate Read Hansard Text Read Debate Ministerial Extracts
The Minister of State, Department for Business, Innovation and Skills (Mr John Hayes)
I beg to move,
That this House has considered the matter of building a high- skilled economy.
It is a delight, having spent so many years in the shadows, to come into the light and be able to speak in this House as the new Minister. Some hon. Members will have read today in the press of my endorsement for floristry and dance. I am wearing this perfectly coloured co-ordinated buttonhole to illustrate the first, but the House, and you in particular, Mr Deputy Speaker, will be relieved to know that I shall not be illustrating the second, at least not by example.
The performance in office of the shadow Minister, the hon. Member for Cardiff West (Kevin Brennan), once the man who called the tune, was rather more of a conga than a quickstep. You know the conga, I have no doubt, Mr Deputy Speaker. It comprises a group of hapless individuals linked by routine, hopelessly following one another on a journey to nowhere.
Adult learning is a subject that inspires in those hon. Members present—I know this is true of hon. Members across the Chamber—emotional attachment and personal commitment. At the same time, it is not a subject in which anyone or any party can claim a monopoly of wisdom, which is why I am interested to hear views from across the Chamber. However, a new Government offer a new chance of a fresh start, the opportunity to bring change and hope to adult learners. However, not everyone realises that there has been a change. Sitting in my office the other day in my new Department, I was surprised to receive an out-of-the-blue phone call from someone asking for Mandy. I had to break the news to him that Mandy had moved on. To paraphrase Barry Manilow, “Oh Mandy, well you came and you took without giving…but I sent you away.”
Lord Mandelson was right in at least one important respect. He made the economic case for skills. The economic case for skills was by far the strongest case made by the previous Government. It is significant, of course—indeed it is vital—but it is not the only case for skills. The economic case, which I shall deal with first, has been thrown into sharp relief by the economic turbulence, by the rising levels of unemployment and falling levels of hope, especially among young people, and by the growing numbers of employers finding it difficult to stay in business. It will continue to occupy a prominent place in public discourse as we move out of recession and towards the renewed growth about which my right hon. Friend the Secretary of State spoke recently at the Cass business school.
Mark Lancaster
I am grateful to my hon. Friend. I should like to invite him to join me in paying tribute to the Open university. The one thing that has not changed in recent times is the contribution that that institution has made to lifelong learning.
Mr Hayes
The fact that I anticipated my hon. Friend’s intervention merely gives it more force. He is right to say that the Open university plays a critical role in that regard. I will happily visit that place once again to cement the relationships that I have already formed there.
The economic case for skills will continue to be important because of the link between skills and competitiveness. It is well established, and it was made clear five years ago in the Leitch and Sainsbury reviews. Already their analysis has become orthodox in the debate about skills and the economy. The essence of their case was, and it remains salient, that driven by new technologies, the pace of economic and industrial change is growing, not just here in the west but in Asia and increasingly in Africa and South America. Once, those countries either did not compete in the same markets as this country or could offer only technologically inferior products. That is no longer the case. The unequal competition between high quality and low cost has been replaced by what Lord Sainsbury called a “race to the top”.
Steve McCabe (Birmingham, Selly Oak) (Lab)
In the context of international competition, how worried is the Minister by the letter in today’s The Daily Telegraph from senior executives of leading British companies, who warn against the dangers of cuts to university funding and the risk that we will be left behind in the international competitive league as a result?
Mr Hayes
There is no doubt that the relationship between research and development and the kind of dynamism that I have described is a profound one. I know that my right hon. Friend the Minister for Universities and Science will take that very seriously indeed in the process of framing our policy in respect of higher education.
I know that the hon. Member for Birmingham, Selly Oak (Steve McCabe) is sympathetic to the argument, so I may be pushing at at least a half-open door when I say that further education matters too. Building skills from the bottom up, re-engaging young people who are not in employment, education or training, up a ladder of skills to the levels that he is describing—levels 3, 4 and 5—is critical. The hon. Gentleman will understand why today I want to speak particularly about further education, as that is my responsibility.
We need to provide workers with the skills they want and businesses with the skills they need to compete in this increasingly challenging world. The Leitch analysis pointed towards an intensive effort to raise skills in this country, and indeed the House more than once debated these matters when the Labour party was in government. It is easier perhaps to say on the Opposition Benches, but I will repeat it from the Government Bench, that I do not accuse the hon. Member for Cardiff West of anything worse than a mistake. I do not think that Labour Members are malevolent; I think their intentions are broadly the same as ours. I just think they are misjudged. This is not about malice; it is about error. I know that they will want to acknowledge that when they speak in the debate. They are big men, and I want to give them this chance, because I am a generous Minister, to rush to the Dispatch Box to say that they got it wrong. Wouldn’t we welcome that? Wouldn’t the whole country welcome it, too?
Mr Hayes
Well, I said I was interested in dance. I am interested in sufficient drama to add to the theatricality of this place, without which it would be poorer.
During the years of the Labour Government, Labour Members often alleged that the largesse for further education would end if we came to power. If the right hon. Member for Tottenham (Mr Lammy), my opponent and friend, were to wish to repeat his unfortunate appearance on “Celebrity Mastermind”—I do not want to remind him of that too much—he could do worse than choose the Thatcher Government as his specialist subject. We came to realise during our time in opposition that the Labour party spent more time speaking about 1979 than about the present. They were preoccupied with that in their dark years, and perhaps that is not surprising for a party that usually looks backwards rather than forwards, whereas the Conservative party is committed to progress and taking our country to where it needs to be now.
As a consequence of that preoccupation with the past, we were left with another Labour Government who spent until they broke the bank. As a result, even before they lost office, they were already cutting adult skills. Last year’s pre-Budget report said—I have it here for those hon. Members who have not had the opportunity to go to the Library to collect it—that £300 million would be cut from the adult skills budget if Labour returned to Government. When Members hear complaints about the new Government’s performance, they should set them in that context. Mandy was first to the table to say he would cut his Department, and encouraged his colleagues to do the same. People are still making phone calls to my office to try to find him, to ask exactly where the cuts would have fallen.
While Labour Members were drifting further and further out of touch into a world populated by fictional numbers rather than real people, Conservatives were talking to adult educators and adult learners about their experiences. We were talking to employers about their skills needs and to union learning representatives about the obstacles they face in creating a learning culture among their members. So that it is unequivocal, so that there is no question and no doubt, let me say that I and the Government are committed to unionlearn; we celebrate all it does and all that it will continue to do with our support and encouragement.
As a result of the conversations we had and dialogues we enjoyed, we learned important lessons about the indispensability of further education as an engine of social and economic change. History teaches us that the better educated a nation’s people are, the more economically prosperous they are likely to be—their general levels of health will be better, too, their communities will be more united and their family and social bonds will be stronger—and the more they will appreciate the things that money cannot buy, but without which life is colourless. All deserve their chance to see, hear, taste and touch beauty.
The conviction that education is the key to so much more than a wage packet drove pioneers, such as the founders of the Workers Educational Association, who sought to take learning, until then the preserve of the privileged few, out to the many. The impulse that promoted better manual skills also created the penny classics that did so much to spread the love of English literature throughout society, and the growth of choral and instrumental societies that brought great music virtually to the factory floor. The fire that drove adult education’s pioneers still burns, and it drives the coalition Government’s programme for further education and skills. The challenge we face in rebuilding a system fit for purpose is scarcely less imposing than was theirs in building a system from scratch.
In recent years, the link between skills and craftsmanship—I am not afraid to call it craftsmanship—the ideal of self-betterment and the pleasures of learning as a means of gaining wider and richer perspectives on the world have been allowed to wither. But not any longer: we in this Government will make a bold case for that relationship—a firm case for the cohesive power of learning, how it changes lives by changing life chances and increases prospects both to gain and prosper in a job, and in all the other ways that I have described.
No one denies that one of the key functions of Government is to create, as far as possible, the right conditions for economic success, and none would deny, I hope, that adult skills policy is one of the most powerful economic levers at any Government’s disposal. But the time has come finally to acknowledge that a socialist model of centralised planning has failed, even in terms of its own narrow criteria for success. We really cannot continue the micro-managed, target-driven, bureaucratic regime that for years has dogged further education and damaged our prospects of raising skills levels.
Mr Deputy Speaker, I know that you and the House will not underestimate the scale of the challenge. The UK Commission for Employment and Skills reported in “Ambition 2020”, published last year, that on recent trends we are likely to slip from 18th to 21st in the OECD rankings for intermediate level skills by 2020. Shadow Ministers will be familiar with the report.
Mr Bailey
I thank the Minister for his kind words. I welcome him to his position and look forward to seeing him in our Committee in due course. I congratulate him on his bravura performance—indeed, it has been quite theatrical at times. He commented on the top-down approach. I note that his colleague the Minister for Universities and Science has written to higher and further education organisations inviting them to publish employability statements. Today the hon. Gentleman placed a statement in the Library saying that the Government would be introducing measures to give
“learners the information they need to drive the system, through the publication of clear and consistent information.”
If that is not an example of a top-down and potentially bureaucratic approach, what is it? Could he enlighten us?
Mr Hayes
I want to be generous; as you know, Mr Deputy Speaker, that is in my character. I know that the hon. Gentleman is new to the task, but he has been an assiduous member of the Business, Innovation and Skills Committee, and a frequent contributor to debates in the Chamber. As such, I hoped he would have known that the key plank of my party’s perspective on this subject—indeed, the coalition’s perspective—is the need to inform and empower learners. It is critically important that people get the right advice and guidance, and part of that process is explaining to them the likely employment outcomes of pursuing courses of study and training. We are encouraging universities and colleges, and the reformed careers service that we will bring in, to give people a very clear understanding of what will happen if they embark on particular routes. What are their chances of getting a job? What sort of job will it be? What are the wage implications? How might they progress thereafter?
Robert Halfon
I congratulate my hon. Friend on doing so much to push forward our policy for 100,000 apprenticeships. Why do only just 28% of British workers qualify to become apprentices or gain technical skills compared to France, where the figure is 51%, or Germany where it is 65%—the percentage we should reach in this country? What has gone so badly wrong in the UK that our skills level is so low?
Mr Hayes
That requires not so much an answer as a seminar, but I shall try to summarise in a sentence or two what I might say at such a seminar. The problem in Britain has been threefold. First, we have not promoted apprenticeships as effectively as we should. Although the brand is strong among potential learners, employers and the public, it is clear that the previous Government did not believe in apprenticeships as much as we do. [Interruption.] Opposition Members complain but many people thought that the right hon. Member for Tottenham’s ministerial predecessor—a valued colleague and a good Minister—did FA for FE and was sent to the FO. I do not know whether Fanny Adams is unparliamentary language, but it is certainly true that in debates with that Minister I made it absolutely clear that we wanted to grow the number of apprenticeships, yet the Labour Government insisted on retaining a strong emphasis on what they regarded as their flagship training and skills product—Train to Gain, about which I shall speak a little more in a moment.
The second point in answer to my hon. Friend’s intervention is that although part of the problem is about marketing, part of it is about resource. We have decided to transfer a significant portion of the Train to Gain budget to apprenticeships, because we know the skills apprenticeships can confer. We know how long they take to learn and we know that people want them. We know employers like them. We know what they cost. That cannot be said of the Train to Gain programme, in which the previous Government placed so much faith.
Roberta Blackman-Woods
I am sure we are all enjoying the hon. Gentleman’s theatrics this afternoon, but will he look at some evidence? In 2008-09, 240,000 people started apprenticeships, compared to 75,000 in 1997-98, so I do not think it is for Labour to take lectures from the Conservatives about the importance of apprenticeships.
Mr Hayes
The hon. Lady must not deceive new Members—[Interruption.] I know she would not do so—except inadvertently, of course; I take that as read—because newer Members might come to believe her suggestion—I put it no more strongly than that.
What the previous Government actually did was to reclassify what counted as an apprenticeship. In France and Germany, about which we heard a moment ago, all apprenticeships are at level 3, and they once were in Britain. When the Labour Government came to power, they reclassified level 2 qualifications as apprenticeships and then trumpeted the fact that there were more of them. As both the Labour Front-Bench spokesmen know, the level 3 numbers remained stubbornly rather less than was required, than the Government wanted and than employers knew they needed. So we should focus on level 3 apprenticeships if we wish to get a true comparison both of our previous performance and of international data.
Kevin Brennan
How many of the 50,000 new places that the hon. Gentleman is announcing can he guarantee to the House will be level 3 apprenticeships?
Mr Hayes
The hon. Gentleman is far too experienced a Member to expect me to give on-the-hoof guarantees of that kind, but what I will say is that I have asked my officials—my officials—to look closely at the definition and, indeed, the stratification of apprenticeships. I want to build the ladder of qualifications that takes people from re-engagement right up to level 4 and 5.
Let me tell the hon. Gentleman and the House about three things that we will do on apprenticeships. As well as putting the extra resource in, we will grow the number of frameworks at level 3 and 4 and we will explore frameworks at level 5, where there is a demand, I am told, in meetings with the high-tech industries such as advanced engineering. The hon. Gentleman will know some of the sectors to which I refer. We will look closely at those level 2 apprenticeships which, with redefinition, can be built to level 3—in other words, some of the high-end level 2 qualifications that with further work may become level 3—and we will think again about those level 2 qualifications that cannot. It is entirely appropriate that they might be regarded as a foundation to an apprenticeship, but I am not sure that it is right that they should be called full apprenticeships. This makes comparisons with our international competitors difficult, and I am not sure that it does not short-change employers and learners. Yes, of course, there is a place for level 2, but the emphasis will be on level 3, and that is what the hon. Gentleman needs to know.
Kevin Brennan
Is the hon. Gentleman saying that some of the new apprenticeships that he is announcing that he will create may not be classified as apprenticeships in future?
Mr Hayes
I want to make progress; I will give way later. The hon. Gentleman has had one turn, and although I am generous, my generosity is not without limit.
I want now to focus on the highly centralised and bureaucratic system that developed under the previous Government, whereby funds that could have been used for teaching and training were actually used detailing plans, complying with targets and formulating schemes. Instead of enabling colleges and other providers to respond to the needs of businesses and learners, Ministers thought they knew what was best. Excessive bureaucracy sapped precious energy from our education system. If I might, as a primer, offer advice again, particularly to newer Members, that if proof were needed of that assertion, it is to be found in the report commissioned as early as 2005 by the last Government under the auspices of Sir Andrew Foster. That report concluded that there was a “galaxy” of oversight, inspection and administration in the FE sector, and called for precisely the kind of streamlined and more responsive structure that we in this Government will now put in place.
Even worse, though, that centralised, target-driven micro-management led to a systemic failure in the form of an FE capital funding crisis from which the sector is still reeling. Members will know that the Learning and Skills Council encouraged bids that would have cost 10 times more than the available funds. Across the country, 144 capital bids were frozen. Members across the Chamber came to the House to complain about the circumstances in their localities and the effects on their local colleges, and rightly so. Seventy-nine of those projects had already received agreement in principle. Many colleges incurred considerable cost.
Andrew Foster was once again brought out of mothballs by the Government to produce another report, and he made it very clear that a top-heavy, bureaucratic system had failed. He concluded that the LSC was too slow to respond—
“there were straws in the wind, early storm warnings, but the problem was not crystallised fast enough.”
So we will look closely at FE capital. Next week, I shall make it clear how we will spend on a bid basis with colleges the extra £50 million that the Chancellor has agreed to devote to FE capital projects.
Kevin Brennan
Can the hon. Gentleman confirm that the extra £50 million that he describes as capital has been taken from the Department’s revenue spending for skills, and that it will only be for this year, and that therefore in the long term, in perpetuity, it is a £50 million cut?
Mr Hayes
I have already celebrated the hon. Gentleman’s assiduity, and his numeracy skills are obvious, too. He is right: the money is being taken from the Train to Gain budget, and it is being allocated to capital. The justification for that is the urgency of the problem. Had the Labour party organised the capital funding in FE in anything like a reasonable way, we would not have to take these emergency measures. That will bring some light to those colleges who were for so long, as I was, in the shadows—in the darkness.
The hon. Gentleman will also know that this is therefore a one-off programme, but we will now look at a longer-term set of proposals for FE capital, and in my estimation even this short-term measure will deliver benefit to 150 colleges across the country. There will be more details next week. I know that the hon. Gentleman cannot wait—the whole House is excited—but he must, because I cannot give all the presents out on the same day; some have to be saved for Boxing day.
There has to be a better way to take advantage of the immense human capital in the college system, to build a high-skilled, high-tech economy. We really must offer a new beginning. That is why I want to move to the four points that lay at the heart of the letter that I wrote today, and then to my exciting conclusion.
The letter that I have written today to the principals of all colleges sets out ways in which we will set FE free. First, I am removing the requirement to complete summary statements of activity, with a resulting reduction in performance monitoring of employer responsiveness. Secondly, the Government have already announced the removal of Ofsted inspections for schools with outstanding performance. I will work with ministerial colleagues to introduce the same way of working in the FE sector, removing inspections for colleges with outstanding performance.
Thirdly, I will remove the regulatory requirement for college principals to undertake the principals qualifying programme, not because I do not want appropriately qualified principals—I know that there are a range of development opportunities and qualifications that can enhance managers’, leaders’ and principals’ skills to run colleges in the 21st century—but because individuals in our institutions should be free to decide what package of development is appropriate to support their individual circumstances.
Fourthly and most importantly, I will enable all colleges except those that are performing poorly to move money between adult learner and employer budgets, because they, rather than Ministers, know how best to meet the needs of local learners and employers. All those measures are intended to increase the power of colleges to determine how best to manage their affairs in the light of local training needs. I want not just to encourage them to listen to what local people and local businesses have to say, but to be free to act, to respond and to use that information with a minimum of fuss, delay and administrative cost.
This is only the beginning—a first indication of the Government’s determination to deliver on the promises we made to providers when we were in opposition. We are drawing a line under the mistakes of the past and reaching for a better future.
It is true that our debate takes place in difficult circumstances and that the public sector will be obliged to make efficiency savings. It is also true, as I said earlier—I want to be honest about this—that no guarantees can be offered about future funding. With freedom comes a fresh challenge, so as unnecessary compliance costs are reduced, I will be looking to colleges to find efficiencies. They would expect that, as would the House. That will include encouraging colleges to find more cost-efficient ways of conducting their affairs, such as by merging back-office functions and streamlining their procurement processes. If the Government had done that earlier—when Labour Members controlled the purse strings—we could have made more progress to match and beat the performance of the competitor countries to which I referred that have outpaced us on apprenticeships and driven up the skills of their work forces to an extent that we have not. The Train to Gain programme was part of the problem. I know that former Ministers are obliged to defend it, but they know what the National Audit Office said about its dead-weight cost. They know that assessment was too often dressed up as training and that the brokerage service at the programme’s heart was, at best, only a partial success.
Before my appointment as Minister, I was fortunate enough to enjoy a long apprenticeship as shadow Minister. Over those years, I held countless meetings with college principals and visited innumerable colleges throughout the country. Everything that I said in opposition, and everything that I say now in government, has been informed by the views and opinions of the sector. We will continue that dialogue about shaping further education in this country—alongside the needs of business and industry, and combined with the Government’s priorities—in a way that delivers opportunities to a new generation of learners.
The stakes are high. The ability of our economy to adapt to rapidly changing circumstances depends in no small measure on the capacity of workers to adapt. They need to be sure of the promise that new skills and knowledge will lead inexorably to new and better chances in life. My aim—and my commitment—is to make good on that promise for the next generation.
Today, a start has been made, but there is much more to do to build a country with the skills that we need to compete, a country ready to elevate the practical, and a country where learning is valued for its own sake and for its economic, social and cultural benefits: proud, confident learners, colleges free to respond and a dynamic, highly skilled economy—Britain being the best that it can be.
Kevin Brennan (Cardiff West) (Lab)
May I start by apologising to the House for the fact that I will not be able to be present for the wind-ups? I have already informed the Minister and you, Mr Deputy Speaker.
I genuinely welcome the Minister to his post as skills Minister on his first outing since the formation of the new Government. Given his flowery rhetoric, it was kind of him to provide a visual aid in his lapel, which we all appreciated. He was somewhat ungenerous in his opening remarks, but that was slightly uncharacteristic. I know that he is a lover of poetry, and I hope that the speech that we have just heard will not be typical of his ministerial speeches, given that it contained no poetry. I am also a lover of poetry, so perhaps I may cite a line from Yeats:
“Those that I fight I do not hate”.
That is certainly true of the hon. Gentleman, but as he might know the rest of the poem, I should emphasise that I do love my own side.
When we were in government, we said that the manufacturing of items constructed out of composite materials probably represented part of the future for Britain, but few of us anticipated that it would be possible to meld the Conservatives and Liberal Democrats to manufacture a composite Government. We can only begin to speculate about how quickly the already visible fissures in that composite construction will form into cracks, and then progressively and inevitably lead to critical failure.
The Minister is extremely fortunate to inherit his portfolio, because he has the opportunity to build on the Labour Government’s tremendous record of achieving so much when we were in power, provided that his Department does not continue to be the Chancellor of the Exchequer’s whipping boy in the frenzied search for cuts far beyond those necessary to bring down the deficit at a sustainable rate.
Let me briefly outline why the Minister is fortunate to inherit our record on skills. The performance of further education colleges and other providers has improved dramatically over the past decade. The satisfaction rates of employers and learners have risen. Since 2001, about 3 million adults have improved their basic skills and achieved a national qualification. Since 1997, more than 2 million people have started apprenticeships, which represents a massive increase in apprenticeship starts since the Conservative party was previously in power. Completion rates for apprenticeships have also more than doubled.
Despite the Minister’s trashing of the Train to Gain programme—although I note that he has not completely axed it—employers and workers report strong satisfaction with the scheme. More than 1 million people have been able to start learning programmes at work that lead to a qualification. That has reduced staff turnover, improved productivity and engaged more than 140,000 employers in training. Earlier this year, I was proud to be able to meet Chris Scott, a process operator at William Blythe Ltd, a chemical manufacturer in Accrington, who, by completing his level 2 NVQ—yes, level 2—in business improvement techniques, became the one millionth learner from the Train to Gain programme to gain a qualification. I should also mention the record number of students in higher education, although my right hon. Friend the Member for Tottenham (Mr Lammy) will say more about that later.
Robert Halfon
The hon. Gentleman talks about the importance of Train to Gain, so why did the previous Government cut £1.3 million from the Train to Gain budget for Harlow college?
Kevin Brennan
It would be remiss of me if I did not welcome the hon. Gentleman to the House. I also pay tribute to his predecessor—a former skills Minister. I shall talk about the priorities for skills spending later. However, I note that although the current Minister has tried to cut the Train to Gain budget and to trash the programme comprehensively, he has not yet completely abolished it.
I am especially proud of the work that we did in government with the trade unions. Despite Conservative hostility, as even the Minister might admit, we introduced the union learning fund, which is now worth £21.5 million a year. As a result, there are now more than 23,000 union learning reps. They get to the parts of the workplace that other trainers and providers sometimes do not reach, and they helped nearly 250,000 workers into learning last year. Latterly—I give this Minister and the Minister for Universities and Science credit for this—that even won praise from the Minister for Universities and Science for its effectiveness and efficiency. One day, the skills Minister might be able to mention the union learning fund and the trade unions in a speech and get the odd “Hear, hear!” from the Back Benchers behind him, rather than the blank looks that he got when he talked about them today.
The highly successful transformation fund for informal adult learning has also brought about a sea change in people’s perceptions of themselves, and has helped to generate a marked increase in participation, particularly among those in the lower D and E socio-economic groups, and that is a legacy of the previous Government’s of which I am proud.
There was huge investment of over £2 billion in building the colleges of the future, although the hon. Gentleman rightly mentioned the problems with the programme. That programme transformed the places in which people learn. He will have the pleasure, as Minister, of visiting many of those colleges and seeing the transformational impact of the capital investment in our further education colleges that took place under the Labour Government. He may also remind himself that not a single penny was spent on further education capital for colleges in the final year of his party’s last term in office. So there is a substantial platform on which to build, and a clear strategy for the future was set out in the skills White Paper last November.
Mr Hayes
Given the spirit that has permeated our exchanges thus far, and indeed today, I know that the shadow Minister will want to welcome the extra £50 million. He was slightly critical when he said that it was to be taken from revenue and was a one-off, but he knows that that was needed and will be welcomed across the sector. Will he just say a word of welcome for that?
Kevin Brennan
I am always happy to argue for more investment and capital for our FE colleges, but later I may return to the issue of the £50 million and whether, overall, the Department should be welcoming the way in which it has been pick-pocketed by the Treasury over that measure.
As I say, there is a substantial platform on which to build. The skills White Paper, which, as the hon. Gentleman knows, was published last November, set out pretty clearly the skills challenges for the next decade and a clear set of proposals to meet that challenge, including an ambition to ensure that three quarters of people participate in higher education or complete an advanced apprenticeship by the age of 30. Included in those proposals were: the expansion of the apprenticeship system to build a new technical class by doubling apprenticeship places for young adults; apprenticeship scholarships; and the focus of the skills budget on the areas from which future jobs will come. I make no apology for that, although I agree with the hon. Gentleman’s remarks about skills being wider than simply an economic matter. I make no apology for focusing on the areas from which future jobs will come.
The proposals also include: a joint investment scheme with sector skills councils; more national skills academies; skills accounts, to which I think the hon. Gentleman referred; user-friendly public ratings for colleges and providers, to which I think he referred in his written statement today; better skills provision for those on out-of-work benefits; promotion of apprenticeships as a priority in public procurement; reducing the number of publicly funded skills agencies by over 30; and focusing resources on key economic strategic priorities. A strong record of achievement and a clear and widely welcomed strategy for the future—that is the strong legacy bequeathed to the hon. Gentleman as Minister with responsibility for skills in the new Government.
Mr Hayes
I do not want to interrupt the hon. Gentleman too often, and I will give him some poetry, if I get a chance, in a later intervention, but he talks about the legacy that his party left. I just want him to be clear with the House about where the £300 million reductions in
“funding not directly supporting learner participation and lower priority adult skills budgets”
would actually have fallen; that is in the pre-Budget report that his Government published.
Kevin Brennan
I am slightly surprised by that comment, because the hon. Gentleman seemed at first in his speech to be criticising us for making those necessary savings, but later to be saying that we should have made them earlier. I am not quite sure why that suddenly became the point on which he wanted to intervene. However, he can intervene as often as he likes; I am happy to give way to him on any number of occasions, as he knows.
What does the hon. Gentleman propose to do with the strong, powerful and compelling legacy that I have just outlined to the House? First, his Department is cutting by 10,000 the number of university places that would have been on offer this autumn. That is despite him and his colleagues persistently claiming—and actually bringing my colleagues and me to the House, when we were the Ministers, to boast about the fact—that they were committed to, creating an extra 10,000 university places over and above what the Government were committed to through a sort of “buy now, pay later” student loan early payback scheme, which we argued was entirely bogus, and which appears to have been wiped from the collective memories of Government Front Benchers during their coalition reprogramming course.
Perhaps when the Under-Secretary of State for Business, Innovation and Skills, the hon. Member for Kingston and Surbiton (Mr Davey) winds up, he can tell us what happened to the pet scheme to conjure up more student places for free. The Minister for Universities and Science explained in the House on many occasions how it would work, despite our scepticism. Has the Treasury finally explained to him and his colleagues what we told him all along—that it was Mickey Mouse maths and would not work? I think that the Under-Secretary agrees that it is Mickey Mouse maths; he did when he was in opposition.
What else have the Administration done on skills apart from announcing cuts to university places and budgets? They have tried to soften the Department’s pain of being the Chancellor’s whipping boy so far in the £6 billion in-year cuts package by recycling £200 million from the skills budget—from the Train to Gain programme—into additional apprenticeship places costing £150 million, and, as the Minister outlined, into capital for further education colleges of £50 million. The Secretary of State bragged about that yesterday in the Chamber. He tried to give the impression that it was year zero and that he was the first Minister ever to come to the Dispatch Box to announce anything about spending on further education capital and apprenticeships.
On capital, the Secretary of State has been done over by the oldest Treasury trick in the book—converting revenue into capital. He claimed that he kept back £200 million from the package when he is doing no such thing. The £50 million on capital, as the Minister generously admitted in his remarks, is for this year only. The Chancellor has picked the Secretary of State’s skills budget pocket for future years to the tune of £50 million per annum and that should be acknowledged.
The Secretary of State should have made the case for capital separately, if he wanted to make such a case to the Treasury in the spending review. Instead, he has allowed the Treasury to deny the skills budget £50 million a year from next year onwards—in perpetuity—even before the Budget and the spending review. That is a little naive. He has been had and he ought to have known better.
Let us consider the apprenticeships proposal. There are no stronger supporters of apprenticeships than me, Labour Members and the previous Labour Government. No Government did more than the previous Government to rescue apprenticeships from the almost criminal indifference of the previous Tory Government, who allowed apprenticeships to fall to only 65,000, with a completion rate of only a third.
The Secretary of State should be more candid about the proposals. He is not trying to do the difficult, but most important, things on apprenticeships. He is after the low-hanging fruit—and I hope he will think carefully about that—because he hopes to claim a quick victory on apprenticeship numbers. For the benefit of the House and all concerned, let us be clear about what he is doing. Although he tried to give an impression to the contrary yesterday, he is not creating new training opportunities apprenticeships for the youngest and most difficult to place. He is not—as we pledged to do and he must still deliver, unless he wants to tell us that he will abandon the policy; I do not think that he will—trying to create more advanced apprenticeships for young adults. He is not aiming to support a particular number of new jobs. He is transferring funding in the training and skills budget from one form of funding for those who are in work into another—good, but more expensive—form of training, which he knows is overwhelmingly likely to be taken up not by employers looking to take on new young workers who are currently out of work, but by those who will train a smaller number of older workers currently in work than they would have done under Train to Gain.
Now that is fine—it is a legitimate decision for the Government to make—but the Secretary of State should not try to give the impression that the announcement and the programme is likely to result in 50,000 new job opportunities for young people, or even new jobs for older workers.
Mr Hayes
We cannot allow this to stand, can we? I hope that I wear the weight
“Of learning lightly like a flower”,
in the words of Tennyson. I also hope that that learning might inform the thinking of the House on apprenticeships. Of course some of the new apprenticeships will be adult apprenticeships and some will be for young people, and of course some will be about upskilling and some about reskilling, but to suggest that the people involved will simply be those currently taught under Train to Gain is nonsense. The hon. Gentleman knows what the National Audit Office said about that scheme: 25% dead-weight cost.
Mr Speaker
Order. May I say to the Minister that the erudition of his intervention was equalled only by its length? Although it is a joy to listen to his mellifluous tones, I hope that not all such interventions will be of equal length.
Kevin Brennan
It is a joy to listen to the Minister, and I am glad that he at last came up with some poetry and quoted Tennyson’s words that one should wear learning lightly. Perhaps I could come back with some Alexander Pope:
“A little learning is a dang’rous thing;
Drink deep, or taste not the Pierian spring”.
The vast number of people who will take up the Minister’s proposals will already be in work, and they will be in the older, not the younger, age bracket. He may prove my prediction wrong in future, but he does not have a rule to ensure that the apprenticeships are for younger workers—under-25s—or one to ensure that apprenticeships are for new starts only. If he wants to talk about dead weight, he should calculate the dead weight of his proposal in respect of the training that would have happened anyway.
The Minister also needs to tell us how he will drive up apprenticeships elsewhere—in the public sector, for example. How will he use procurement to help that? Unless he shows leadership—I say this to him candidly and sincerely—and knocks heads together in the Government, that will not happen. All he will get from his colleagues will be that one-note symphony that we have heard so far from the Government, like the vuvuzelas in the World cup, saying that nothing can be done on public sector apprenticeships because of cuts. That is what he will be told. My advice to him is this: he needs to fight, fight and fight again against Treasury orthodoxy on behalf of apprenticeships if he wants to make an impact as a Minister.
It is clear that the Minister’s enjoyable and occasionally flowery rhetoric—if he will forgive me for saying so—hides a prosaic reality in the Department for Business, Innovation and Skills. The Secretary of State really wants to be in charge of the banks but has been walked all over by the Chancellor of the Exchequer in that ambition and, in an age-old Treasury way, has had his pocket picked over FE, skills, capital and revenue; and the Universities and Science Minister, who really wants to be the Secretary of State and deeply resents the Liberal Democrat succubus who now has his job, has, in his absent-minded, dual-brained, batty, professorial way, carelessly mislaid 10,000 university places since the election. It is no wonder that in the confusion, the Treasury has been able to bamboozle a Department that has two heads and three brains. Now we have proposals for capital and apprenticeships that are not all that they seem.
If we are going to build Britain’s skills for the future, we need strong, united leadership from the Department, not weak, divided leadership hidden by the Minister’s baroque oratory. His words are fine for now, but unless he starts standing up for skills, his flowery rhetoric will wilt under the heat of political reality.
Mr Speaker
Order. As I think the House will be aware, the debate is heavily subscribed, and I therefore impose a 10-minute limit on Back-Bench speeches, to apply with immediate effect.
Iain Stewart (Milton Keynes South) (Con)
I am grateful for the opportunity to make my maiden speech as the first Member for the new Milton Keynes South constituency. I regret that I do not have any poetry to share with the House this afternoon, but I am pleased to contribute to this debate on building a high-skilled economy. The motto of Milton Keynes is “By Knowledge, Design and Understanding”, and my constituency has always been at the heart of learning and technological innovation.
Before I turn to those themes, let me first pay tribute to my predecessors. I use the plural deliberately because, thanks to the work of the Boundary Commission, I have two. The bulk of my constituency was in the former Milton Keynes, South-West seat, represented for the last 13 years by Dr Phyllis Starkey. I got to know her quite well, having been her opponent in the 2001 and 2005 elections, as well as in the poll last month. Over the 10 years in which we were political sparring partners, it is fair to say that there were few policies on which we agreed. However, I pay tribute to her for her service to Milton Keynes. To represent such a diverse and dynamic constituency for more than a decade is no small achievement. I also know that she had a strong reputation in this House for pursuing her causes with tenacity and determination.
My other immediate predecessor is, I am delighted to say, my hon. Friend the Member for Milton Keynes North (Mark Lancaster). He was a diligent and well-regarded representative for the two wards that I have inherited from him—Danesborough and Walton Park—and I look forward to continuing his good work. Indeed, we are planning to work very closely together to provide a seamless service to the whole of Milton Keynes. In these financially challenged times, we are endeavouring to save on the public purse by sharing a constituency office.
Hon. Members may think that they know about Milton Keynes, but I would like to use this speech to challenge a number of misconceptions. In an economic debate, it would have been neat to follow the widely held view that Milton Keynes is named after the two distinguished economists, Milton Friedman and John Maynard Keynes, but that is not the case. The city takes its names from the historic village of Milton Keynes, which is in my hon. Friend’s constituency.
It is true that Milton Keynes is a new city that is just over 40 years in age, with plenty of modern housing estates, and the roundabouts and grid road system with which hon. Members may be all too well acquainted if they have not followed the logic of the layout. However, that modernity belies a rich history stretching over many centuries. Stony Stratford, for example, is an ancient coaching town on the Watling street roman road. The House may not know that the origin of the phrase “cock and bull story” lies in Stony Stratford. On the high street, there are two hotels—the Bull and the Cock. Legend has it that, as travellers stopped to break their journeys between London and cities in the midlands and north, the ale flowed freely and stories became more and more embellished before being relayed, in their exaggerated state, to their destination. I pledge that my contributions in this House will have a sounder factual base.
Bletchley, which forms about one third of my constituency, is of course the home of Bletchley Park and the code breakers, whose brilliant work certainly shortened the second world war and saved many hundreds of thousands of lives. Indeed, it is not too much of an exaggeration to say that their work changed the outcome of the war and, had they not succeeded, we might not today enjoy the freedom of speech that we do. I am delighted to report that, after many years of neglect, important restoration work is being carried out at Bletchley Park, under the expert guidance of its director, Simon Greenish, and I shall do what I can to ensure that the restoration project is completed.
I also wish to use this opportunity to pay tribute to the former Prime Minister, the right hon. Member for Kirkcaldy and Cowdenbeath (Mr Brown), for what he did to right the wrong against the brilliant code breaker and mathematician, Alan Turing, a national hero who was so persecuted for being gay that he ultimately took his own life. While the right hon. Gentleman and I share little political agreement—although, in the interests of full disclosure, I should declare that I was christened by his father—I pay tribute to him for making that national apology for the wrong done to Alan Turing.
Bletchley Park is also the home of the modern computer, which is just one of my constituency’s major contributions to the UK’s high-skilled economy. That tradition has continued with the Open university, which is also located in my constituency. Many hundreds of thousands of lives have been transformed by the Open university, and it has long-embodied the vital principle of lifelong learning, reskilling people as their careers evolve and giving a second chance to those who have, for whatever reason, missed out on a more traditional form of higher education. The new vice-chancellor of the Open university, Martin Bean, is making an excellent start in preparing and updating the university to meet the ever-evolving challenges that lie ahead. His appointment is significant, because as a former senior director of Microsoft, his move from a high-end private company to the world of education illustrates the vital links that must exist between the two if the UK is to sustain a high-knowledge economy.
Milton Keynes is home to another pioneering model of higher-level learning that I believe will play a major part in the skilling of our economy—University Centre Milton Keynes, under the wise leadership of Professor Keith Straughan. When fully established, this exciting new concept will enable young people to access top-quality learning close to home and integrated with their learning at work. It is a model of partnership working and came about as a result of demand from the local community, local employers, civic partners and the voluntary and community sector. Will the Minister, as well as visiting the Open university, visit UCMK? I am sure that he will find a lot there that fits with the Government’s agenda.
I have long believed that to unlock the full potential of people in the UK, we need to break down some of the barriers that sometimes exist between higher and further education, and the needs of skilled employers. To ensure that the UK can beat both our traditional economic competitors and the fast-rising challenge from emerging economies, we need much greater flexibility in our education system, and in that Milton Keynes is leading the way.
Milton Keynes has a high-skilled economy, with many exciting new projects, such as the electric car scheme being piloted there. However, our success does not rest alone on its dynamic economy. For a relatively young new city, we have a fantastic, positive, can-do attitude and enjoy a rich tapestry of civic society, with more than 1,200 voluntary and charitable organisations. That spirit is embodied by Milton Keynes’ successful bid to be a host venue should England be successful in staging the 2018 World cup. And let this Scotsman put it on the record that I want England to triumph in South Africa and to go on to host the tournament in eight years.
After my electoral disappointment in 2001 and 2005, I could easily have moved on and sought a securer passage to this place, but I did not want to. Having made Milton Keynes my home, I wanted to be the Member for that area, and I feel honoured to be given a chance to represent it in the House. I began my speech by paying tribute to my immediate predecessors, but I would like to conclude with a reference to another former Member—Bill Benyon, who is the father of my hon. Friend the Member for Newbury (Richard Benyon) and was Member for the Milton Keynes area for 22 years until 1992. Nearly two decades after he retired from this House, he is still remembered with great warmth and affection by many of my constituents as a kind, compassionate and hard-working man who believed in Milton Keynes and did whatever he could to champion this exciting new city on a wider stage. I hope that, in my time in the House, I can achieve a similar record of service.
Steve Rotheram (Liverpool, Walton) (Lab)
I congratulate the hon. Member for Milton Keynes South (Iain Stewart) on his maiden speech—a Scotsman supporting England, hey?
“Forgive me, Mr. Deputy Speaker, if I stumble over the proprieties peculiar to the House”.—[Official Report, 24 July 1991; Vol. 195, c. 1202.]
Those are not my words, but the opening salvo in the maiden speech by my predecessor, whom I shall cite more later, on 24 July 1991. Such observations are as true today as they were 19 years ago. Although I have only been in this place for a few short weeks, I have already started to take notice of the vagaries of the House. For example, I have noted that when a Member begins a speech with the words “I will be brief”, an extensive and loquacious contribution is guaranteed. Similarly, when the words “This doesn’t really need saying” are uttered, it is odds-on that an explanation of what it was that did not need saying will be given, in some detail, to those to whom it did not need explaining in the first place.
Mr Speaker, you may well have been able to discern from my accent—if not my haircut—that I am from the home of John, Paul, George and Ringo. However, it is also the home of Gerry Marsden, The Farm and China Crisis—to unashamedly mention just a few of my personal friends. Liverpool boasts too many politicians, musicians, comedians, poets, broadcasters, artists and so on to mention individually. Otherwise, my maiden speech might well have been one of the longest ever recorded.
It is also possible to find a Scouser at every level of our armed forces. One of my constituents, Craig Lundberg, who was blinded in an attack by insurgents in Iraq, is an inspiration to others. Like many Members from all parts of the House, I would like to pay tribute to all those in our armed forces who carry out such dangerous and commendable work on behalf of us all.
I represent a constituency that, uniquely, boasts two premiership football clubs within its boundaries. In our football-mad city, the achievements of Everton and Liverpool have a direct effect on the fortunes of our city. Historically, we have been no strangers to on-field success. However, for one of our clubs it is now fortunes of the financial kind that threaten its very existence. I urge hon. Members to sign early-day motion 197 on the issue, as the Minister concerned previously refused my request for a meeting with the Royal Bank of Scotland.
I should perhaps declare at this point that I am a dyed-in-the-wool Liverpool fan and a season ticket holder at Anfield. However, I would honestly say the same things if Everton FC had been the victim of a leveraged buy-out that had endangered its future survival and caused so many problems for my constituents living in close proximity to its football stadium. England’s most successful football club is slowly being drained by the greed of two American asset strippers, and this is having a negative impact on regeneration projects for the whole area. Unfortunately, the beautiful game does not always attract those with beautiful intentions.
One of the great socialist philosophers of the last century—the great Bill Shankly—may have been mistaken when he said that football was more important than life and death. However, supporters of both of our sporting institutions at least understood his passion, and they will not stand idly by without being engaged in the future of their respective football clubs.
The reason Mr Shankly was, uncharacteristically, wrong is that our city unfortunately recognises more than most the life-and-death results of poor stadium safety and ineffective policing—primary causes of the tragedies at Heysel and Hillsborough. I can assure my constituents that I will campaign on their behalf against any plans to water down ground safety standards, and that I will fight tooth and nail to protect the inquiry set up to examine the Hillsborough disaster. I would like to thank my right hon. Friend the Member for Leigh (Andy Burnham), on behalf of all the Hillsborough families, for pushing so hard to get the process started.
My predecessor may have been from the blue half of Merseyside, but he was certainly from the politically red half of this Chamber. It is traditional for Members making their maiden speeches to highlight the contributions of their predecessors. Some are faced with the unenviable task of waxing lyrical about a political opponent whom they may recently have put to the electoral sword. Others may have replaced a colleague in controversial circumstances, while some may have been complicit in their predecessor’s downfall. I am pleased to say that none of those scenarios applies in my case. Put quite simply, I would not be in this place without the support, encouragement and friendship of Peter Kilfoyle.
Peter will go down as one of the great parliamentarians. He was widely respected in all parts of the Chamber, despite—or perhaps because of—the fact that he was independent of mind and voted with his conscience, sometimes controversially, as on the issue of Iraq, but also in his spirited opposition to the scrapping of the 10p tax rate. Peter’s opposition to the Iraq war was not met with universal support on the Labour Benches at the time, but it appears that some of my right hon. Friends who are in the race for the Labour leadership are also now expressing reservations about that policy. As coalition Members will find out, hindsight is a wonderful thing.
In a world of political self-aggrandisement, Peter Kilfoyle sacrificed career advancement for ideological principle. It is refreshing that there are still men and women whose moral judgment and values override the dangled carrot of elevated office. I can only aspire to follow in Peter’s footsteps. He dedicated 19 years to the service of this House and to his constituents in Liverpool, Walton. He also achieved his aim of doing justice to his predecessor, the late Eric Heffer, who gave 27 years to the same cause. I certainly have my work cut out if I am to follow two such political giants. I wish Peter’s lovely wife Berni all the very best in coming to terms with having him under her feet 24/7.
It is an unbelievable privilege to have been elected by the people of the area in which I have lived all my married life, and I am delighted to represent them in this place. I do not intend to let them down. I am proud to be a Scouser and to represent Walton, where my mum was born. One of the best things about making my maiden speech is that my mum’s name, Dorothy Rotheram, will now be recorded in Hansard in perpetuity.
I actually thought I had something in common with the Prime Minister when someone mentioned that he, too, had been brought up on an estate. On further examination, however, I discovered that his estate was not that similar to ours after all. I make no apology for stating on the record that I intend to be a strong voice for the people who elected me to the safest seat in the country, and for the city I love. I plan to be a constant thorn in the side of the present Government, and to ensure that Liverpool is not disproportionately affected by funding cuts, as it was the last time Tories sat on the Government Benches.
Both of my predecessors had connections with the construction sector, and I am delighted to keep up that tradition. I am guessing that I am among only a tiny minority of people in the Chamber who have completed an apprenticeship. I started my working life as an apprentice bricklayer, and my son Steven is an apprentice electrician. I am passionate about the building industry and about apprenticeships. The Labour Government breathed new life into apprenticeships, which had been all but killed off by the previous Conservative Government. A high-skilled economy is not just about graduates, and I therefore welcome the Government’s road-to-Damascus conversion on that matter. I will campaign for parity of esteem between vocational and academic training routes.
As a serving Liverpool councillor, I would like to put on record my congratulations to Councillor Joe Anderson and my colleagues, and I wish them all the very best in the months ahead. My predecessor concluded his maiden speech by highlighting to the then Conservative Government that unless they took steps to tackle the social issues of the day, they would not be forgiven. Coalition Members should heed such lessons from history.
Caroline Nokes (Romsey and Southampton North) (Con)
Thank you, Mr Speaker, for giving me this opportunity to make my maiden speech today and, in so doing, to contribute to this debate on building a high-skilled economy. I congratulate the hon. Member for Liverpool, Walton (Steve Rotheram), who is fortunate to be able to boast of two premiership football clubs in his home city. Sadly, in Southampton we can no longer do the same. I should also like to congratulate my hon. Friend the Member for Milton Keynes South (Iain Stewart), who made an excellent contribution, enlightening us on the motto for Milton Keynes and challenging some of the misconceptions that even those who are relatively close to his constituency might have held.
A debate on a high-skilled economy is particularly pertinent to Romsey and Southampton North. In Chilworth, we have the excellent university of Southampton science park, where 14% of the employees are graduates of the university. It contributes more than £370 million annually to the regional economy. I was fortunate to visit one of the companies on the park just this week, and I can certainly attest to the importance of a high-skilled work force, given that they were testing high explosives.
My next comments are far removed from the high-tech world of Chilworth, as I turn to the heart of the constituency, Romsey town, several hundred years ago. On the edge of the town, being renovated this year, is Broadlands—the stately home where the 19th-century Prime Minister Lord Palmerston was born. Broadlands has been described as having a grandness that personifies the swaggering confidence of Palmerston. I can assure fellow Members that there will be no swaggering from me today.
Although Palmerston was born in Romsey, he never served as its Member of Parliament, so I will not pay tribute to him as a predecessor—and anyway, going back to the 19th century would be somewhat stretching the point. He did, however, have an interesting political journey as a Tory, a Whig and, indeed, a Liberal. It is interesting to note that he has been described in some biographies as having too strong a character to be overwhelmed by liberalism.
I would like to pay tribute to two predecessors in the Romsey constituency. Michael Colvin served the constituency of Romsey and Waterside from 1983 to 1997, and the Romsey constituency from 1997 until his untimely death in 2000. Michael was a good man, a farmer who understood the rural areas of the constituency well. He was a former Grenadier Guard, and was passionate about championing defence issues. He well understood the military issues relevant to the school of Army aviation in Middle Wallop, and he was also a parish, district and, indeed, a county councillor in Hampshire. As a serving borough councillor in the same district that he served, I can attest to that being a good apprenticeship for Parliament.
Also committed to Romsey was my immediate predecessor, Sandra Gidley. She worked hard for the constituency and was well known for her commitment to the NHS and to women’s issues. She is, of course, also well known for having dragged Mr Speaker to his Chair last year.
The recent election saw significant boundary changes, and further parts of Southampton are now included in the new Romsey and Southampton North constituency. It now includes the Ford plant at Swaythling. Southampton is well known as the home of the transit, and Ford is committed to using innovation and technology to make Britain’s best-selling light commercial vehicle as green as possible. It has been successful, and its ECOnetic transit has the lowest CO2 emissions in its class.
Even in an area where we are fortunate to have good schools, an excellent university and companies like Ford committed to Britain’s manufacturing base, there is still a disconnect between what employers want and the skills of our school leavers. It is critical that the two are matched, and that our education system works with employers to make sure there is no skills gap.
Having a strong and productive work force is about many things, and one of the key strengths of the Romsey and Southampton North constituency is the quality of life and the quality of the natural environment. As a remedy for stress and tension, there really is nothing better than some of the countryside and open spaces in the constituency. If the restorative qualities of the River Test could be bottled, there would be a far reduced need for pharmaceutical products. We also have a small corner of the New Forest national park in the constituency. Although the park and its authority do not come without some level of challenge, it is at least an area where dog walkers and native ponies still prevail.
The River Test, one of the finest trout rivers in the world, runs north to south through the constituency, and it has been appreciated over the years by prime ministers and presidents from across the globe. It has a fine tradition of fly fishing, and a wonderful tranquillity and beauty, which can give amazing solace.
Even in the more urban parts of the constituency, there are pockets of open space that enormously enhance the quality of life. Residents in Swaythling have worked hard to preserve and maintain Monks Brook. One of our local wildlife photographers delights in sending me pictures of adders and slow worms from this tiny patch of countryside right next to the motorway. In Bassett there is the sports centre, Daisy dip and the golf course, and I appreciate how hard the city council works to maintain these areas and secure their future.
Romsey has a real gem with the Memorial park proudly flying a green flag for the second year running—and we have our fingers crossed for an announcement next month about its third. It is home to the community orchard, the bandstand and a team of volunteers from the friends of the Memorial park who make sure the park is one of the best in the region. There is also one of the pair of Japanese field guns that Lord Mountbatten of Burma brought back to Romsey at the end of the second world war.
Other parts of the constituency, however, are not as well protected as those public open spaces, and it is inevitably of concern that some areas are at risk of being swallowed up by development. I welcome the news from the Government that regional spatial strategies are to be consigned to the dustbin. We cannot allow the gaps between settlements to be eroded so that local character is diminished as neighbourhoods coalesce and individual identity is lost. The residents of Halterworth, those close to Hoe lane in North Baddesley, and the residents of Redbridge lane in Nursling have a commitment from me to ensure that local strategic planning really is put back in the hands of local people.
Of course, building a high-skilled economy is not just about the urban centres of the constituency. There are many beautiful rural villages in the north, where problems are inevitably caused by the lack of high-speed broadband—or indeed any broadband at all—but where there is also a good strong farming tradition. The fact that agriculture is traditional does not mean that it is not high-skilled; far from it. Those skills manage and maintain our countryside and, very importantly, keep us fed. While focusing on the high-skilled, we must ensure that we do not let Britain’s farming tradition wither.
Let me end on a lighter note. Romsey is claimed to be one of the most haunted parts of Hampshire. Florence Nightingale allegedly still walks the corridors of her old home at Embley Park, and both Romsey abbey and Wherwell priory are said to be haunted by nuns. One of the best known ghost tales is that of two Roundhead soldiers who were hanged from the iron bracket outside the former Swan Inn. The building now houses the local Conservative club. One managed to cut himself loose, and then ran to his death in an alleyway in the town. Apparently he can still be seen repeating his failed escape attempt. However, although the bracket remains to this day, I can assure Members that it has been some while since there has been a public hanging in Romsey.
Steve McCabe (Birmingham, Selly Oak) (Lab)
Let me begin by congratulating the hon. Member for Romsey and Southampton North (Caroline Nokes) on an entertaining and well-informed maiden speech. I am sure that she will make a great addition to the House and will serve her constituents well. I also congratulate the hon. Member for Milton Keynes South (Iain Stewart) and my hon. Friend the Member for Liverpool, Walton (Steve Rotheram). I must tell my hon. Friend that I am another Scot who hopes that the England side does well—but I look forward to hours of arguments about football in the years ahead.
I welcome the Minister of State, Department for Business, Innovation and Skills, the hon. Member for South Holland and The Deepings (Mr Hayes), to his post and wish him well, although I see that he has just left the Chamber. I thought that his speech was a wonderful performance. I have concluded that if the pressures of government grow too great for him, as they inevitably will at some point, he will have a great future in amateur dramatics.
I was pleased to hear the Minister’s plans, some of which I think deserve consideration. For instance, I was glad to learn that he plans to look at the careers service with a view to possibly revamping it. I was surprised and worried to read in a briefing that I received from Edge—the independent foundation that promotes vocational qualifications—that in response to a survey conducted last year, more than 50% of secondary schoolteachers admitted that their knowledge of apprenticeships was remarkably poor.
Mr Hayes
I am grateful to the hon. Gentleman for his tribute and for the information that he has just provided. The same survey revealed that teachers knew less about apprenticeships than about any other qualification apart from the Welsh baccalaureate. I have nothing against the Welsh baccalaureate, but the hon. Gentleman will understand the point.
Steve McCabe
I am glad to learn that the Minister has taken that information on board. As I have said, it worried me to read it, and also to read that many apprentices who were surveyed said that very little information had been given to them about apprenticeships either by secondary schoolteachers or, more importantly, by careers specialists. It seems pretty obvious to me that, if we are interested in promoting apprenticeships, we shall have to convey some basic good information to young people. Both the careers service and the information available to secondary schoolteachers must therefore improve.
I am not quite sure what the Minister was attacking in his comments on level 2—I am not sure whether that was code for a cut in numbers down the line. It seems to me that £50 million could buy an awful lot of opportunities for young people, and if that sum is taken out of the budget in the years ahead, perhaps the Minister has to prepare the way by telling us that he will downgrade certain qualifications and opportunities.
I welcome, however, the Minister’s acknowledgement that level 2 can provide a very useful foundation. I was struck by the statistic in the CBI report, “Ready to grow” that 32% of employers found it remarkably difficult to recruit people with the necessary intermediate skills. It seems to me that those people will never be available unless we can provide them with a basic foundation to start with, and the general definition of level 2 is that it provides people with a solid grounding and a basic set of skills from which they can begin to build and develop their chosen careers.
I do not particularly want to quibble with the Minister about the definition of apprenticeships, but level 2 is very important in getting some young people on the path. Whatever the Minister’s comments today about level 3 were intended to mean, I hope he will bear in mind that it is essential that youngsters have a route in, and that the only way that we will be able to provide employers with people with the requisite skills is by giving young people that starting point.
I also welcome the Minister’s plans to set further education colleges free, although I am not sure how free they will be if they are starved of funding, as it strikes me that that can be a fairly empty form of freedom, and I noticed that there was very little detail about exactly what this freedom will amount to. I would like FE colleges to be encouraged to develop programme apprenticeships—they already have a great deal of skill in that respect—and those apprenticeships are a way of enabling young people in particular to begin their apprenticeship at a time when it may be quite difficult for them to find an employer to take them on. Employers, particularly small businesses, are struggling to develop apprenticeships at present because of their fears about the economic future.
Mr Hayes
I am grateful to the hon. Gentleman for giving way for a second time.
For the sake of clarity, let me repeat something that I have already said: I am writing to every Member to describe these freedoms to which the hon. Gentleman refers, and they are all things that have been specifically requested by further education representatives in numerous conversations that we have had with them over a period of years.
Steve McCabe
Well, the detail is obviously in the letter then, and I look forward to reading it.
I was slightly disappointed that the Minister did not make any specific reference to small businesses. If we want to grow meaningful apprenticeships, small businesses are the obvious sector that we need to target, but we all know that they have difficulties in dealing with apprenticeships. I was glad to hear that the Minister is enthusiastic to cut through the red tape, but when I talk to small employers, they tell me that they need help in developing apprenticeships; they need help with the basic training and assessment. That is the other side of what needs to be done. One side is to encourage youngsters by ensuring they have the necessary information and by promoting apprenticeships, and the other side is to make it possible for small employers in particular to take on young people.
I wonder whether the Minister has considered the idea of group apprenticeship schemes, which I understand have been particularly successful in Australia. I believe that there are some pilot schemes in this country. The essential idea is that the apprentice is employed by a group and is sent out on placement to various employers. It then becomes possible for a group of small employers to get together and to save on the administrative costs and overheads. A number of youngsters can therefore be placed on an apprenticeship scheme and get real practical experience with employers.
Has the Minister any plans to consider university technical colleges? There is one in the Birmingham area, at Aston, and I think there are about four around the country. That model seems to bring universities together with employers. In the engineering and manufacturing sectors in particular, it encourages the development of a steady skill development path. It builds on vocational levels through to level 5, and the previous Government sought to encourage it. I would like to know whether the Minister has plans to pursue it.
Mrs Madeleine Moon (Bridgend) (Lab)
Is my hon. Friend aware of other initiatives coming out of universities that also help to build the high-skill economy? I cite, for example, Wendy Sadler’s scheme out of Cardiff university, of which my Front-Bench colleague, my hon. Friend the Member for Cardiff West (Kevin Brennan), will be aware. They have used “Science made simple” to reach out to 250,000 youngsters, getting them to understand science and how they can have a career in science and find employment through science in high-tech and high-quality jobs. Universities have a unique role in reaching out to young people before they make their career choices, perhaps involving universities or apprenticeships.
Steve McCabe
If we are going to create jobs for the future and to have a generation in work rather than unemployed, all such initiatives should be encouraged and explored. I agree with the Minister—I do not think that any of us has ownership of these issues—but it is pretty important that we get it right, because we have one chance.
Stephen Pound (Ealing North) (Lab)
Does my hon. Friend agree that one of the difficulties with apprenticeships is finding an employer to take the apprentice on for the third year, or even in some cases for the second year? In the benign balmy days of a sophisticated Labour Government who had the economy moving forward, that was quite easy, but now, as the chill winter of Conservatism starts to freeze the economy from all corners, might it not be an idea for us to revert to what the Conservatives did the last time that they were in power and introduce schemes such as the Manpower Services Commission scheme, the youth opportunities programme and so on to provide some support and encouragement to employers? It is easy to take on an apprentice in the good times, but very hard in the bad times.
Steve McCabe
I agree absolutely with my hon. Friend. Employers need help and encouragement, and the only people who can provide that are the Government. If we are going to get this to work, that is what has to happen.
The Minister struck a note of optimism today. As I said to him in an earlier intervention, I do not think that that is the view of the senior executives who wrote to The Daily Telegraph today; they struck a note of anxiety and pessimism about cuts in university funding and about being left behind in international competition. It was difficult to see the Minister’s optimism when it came just after the speech from the Chief Secretary to the Treasury, in which he told us that he was axing the young person’s guarantee.
I wish the Minister well, but I warn him that this is going to take more than warm words. The last thing we need to see is a lost generation that does not even get the chance of work. That is the legacy that the Tory Government of the ’80s left us, so I hope that he will learn from the mistakes of the past.
Mr Deputy Speaker (Mr Nigel Evans)
Order. I know that hon. Members will wish to respect the conventions associated with maiden speeches, as we are privileged to have a number of them this afternoon.
Jason McCartney (Colne Valley) (Con)
I welcome you to your position, Mr Deputy Speaker. Thank you very much for inviting me to make my maiden speech this afternoon. This is quite a nerve-racking occasion, but I feel a little more relaxed now that we have been talking about football, which I know a lot about. Like the hon. Member for Liverpool, Walton (Steve Rotheram), who is a red through and through, I am a blue through and through: I am a fan of Huddersfield Town, who play in blue and white. There are some similarities between our clubs—for example, the great Bill Shankly began his managerial career at Huddersfield. I am not sure how many other similarities we will have over the years, but I look forward to talking to the hon. Gentleman about football for many years to come.
I should like to praise Conservative Members who made their maiden speeches earlier. Again, I will mention football, because my hon. Friend the Member for Milton Keynes South (Iain Stewart) is one of those Members, and I certainly enjoy travelling around Milton Keynes trying to find the football ground. My hon. Friend the Member for Romsey and Southampton North (Caroline Nokes) also spoke, and I wish Southampton football club good luck in the forthcoming season without the deficit of 10 points that it had last season.
I want to pay tribute to two of my predecessors. Speaking of football, it was at Millwall football club, three weeks ago, that I ran into Graham Riddick, who was the Member of Parliament for Colne Valley between 1987 and 1997. While I was cheering on the Terriers in the play-offs down at the New Den, I looked along the terracing and, lo and behold, there was Graham Riddick cheering them on too. It was great to catch up with him and he gave me many words of advice and encouragement, so I thank him for that.
I should also like to say a few kind words about my direct predecessor, Kali Mountford, who spent a lot of time helping me and my office manager by talking us through all the casework that she so pleasingly handed over to us; she looked very relieved as she did so. I praise Kali for her work with the Anthony Nolan bone marrow trust, which she has promoted in recent years. As a result of her hard work there, I have signed up to the trust and I encourage all hon. Members and members of the public to do so. That campaign was motivated by the death of a campaigning journalist from The Huddersfield Daily Examiner, Adrian Sudbury, and I congratulate Kali on highlighting it. She has suffered from poor health in recent years and I wish her and her husband Ian the best of luck in the years to come.
Colne Valley is not the best name for a constituency, because those coming from south of Watford, for example, think that it is related to a town called Colne in Lancashire, but it is not. We are in West Yorkshire, and we are proud to be Yorkshire folk. The Colne valley itself is one of three main areas of the constituency. It has some lovely little mill towns on the River Colne, including Marsden, Slaithwaite, which we call “Slawit”, and Linthwaite. I also have some of Huddersfield’s suburbs, from leafy suburbs in Lindley to more densely populated areas such as that of my Kashmiri population at Thornton Lodge.
Then we get to the valley where I live—the Holme valley, which includes my village of Honley, as well as Brockholes and the big market town of Holmfirth. It really is a beautiful part of the world with lovely countryside, stone walls, lots of sheep and lots of traditional folk. That brings me to Cleggy, who has had a bad time in the past month. He has had an absolute nightmare—[Interruption.] No, not that Cleggy: I am talking about Cleggy from “Last of the Summer Wine”, who, along with his pals Compo, Foggy and Nora Batty, is no more because the BBC has ditched the long-running television series that graced our screens on Sunday evenings on BBC1. That gentle comedy about Yorkshire folk, usually going downhill in a bathtub, was very much a mainstay of our television and it helped to promote tourism in my constituency. In Holmfirth, which is just a mile up the road from where I live, we have a Compo’s caff and there is a Wrinkled Stocking café just two doors down from my new constituency office, so we will really miss that opportunity to promote tourism.
All that brings me to the subject of this debate: the high-skilled economy. Many people say to me—other Members of the House probably hear this too—that we do not make things any more, but I am proud to say that in my constituency we do. It is not on a large scale, but I have a number of enterprising, entrepreneurial and innovative businesses that have set up, sometimes in old mills, to create products that have a niche market and that are exporting around the world. I shall mention just a few. There are little engineering companies such as Dathan in Meltham, which produces specialist gear cutting equipment that is used in the Formula 1 motor racing industry. Allsops precision sheet metal work, which uses the latest laser-guided cutting tools, is taking on apprentices. It is not on a massive scale, but it has more than 100 employees and it is looking to expand.
I also have David Brown Gear Systems in Lockwood, which I visited with the then shadow Minister for Universities and Skills, my right hon. Friend the Member for Havant (Mr Willetts), before the election campaign. It has its own in-house training scheme called the Gear Academy and it is training some wonderful youngsters up to work on making gear equipment. Those gears are now being used not only in our submarines but in the wind turbine industry. I also have pharmaceuticals, with Thornton and Ross on the River Colne. I have an ice cream factory, Longleys Farm, which makes the most wonderful ice cream. It has just opened a new ice cream parlour in Holmfirth.
Talking of “Last of the Summer Wine”, we even have a vineyard now—a real live Yorkshire vineyard. A wonderful enterprising young couple called Ian and Becky Sheveling gave up high-flying careers, bought a lovely plot of land and planted their vines. They have just produced their first bottles of rosé and have obtained planning permission for a tasting centre and an eco-lodge. That will help promote tourism and we shall have real bottles of wine from the area of “Last of the Summer Wine”. That is fantastic.
It is these sorts of little enterprises that we, in a high-skilled economy, must try to promote. We have to cut the red tape; we should support them with lower taxes; we must give them the skills in the work force and the local infrastructure so that their workers can live and work locally. We have got to support local rural post offices. In my village of Honley, I have a most wonderful couple, Brenda and Duncan Bodenhem. The post office is not only their livelihood but their way of life. They organise the Christmas lights; they help all the old people come in and out; they do dry cleaning. They do not provide just the usual post office services.
Post offices, especially the rural ones, are struggling, and our post office network was decimated in the last decade. It is important that we support them, because once they are gone, they are gone. We also need to support things such as rural bus services, so that people can live in my rural communities and work there as well. We need to support the health centres and health services. I am trying to get full maternity services back in the area of Huddersfield. That is really important.
I am proud to have been elected the Member of Parliament for Colne Valley. It is a beautiful part of the world with some enterprising businesses and a fantastic football team in Huddersfield Town. We also have just down the road in Huddersfield the birthplace of rugby league, so I have to mention the Huddersfield Giants, who are striving hard this season. They are having a bit of a poor run at the moment, but I hope that they will turn the corner.
Before I sit down, I should like to say that many of us here in this House, especially the new Members, have been through a gruelling and hard-fought election campaign. I and all my family and friends went through a lot to get me here. I know that the Speaker himself had a bit of a tough election campaign. The hon. Member for Liverpool, Walton (Steve Rotheram) had a straightforward election campaign; his is the safest seat in the House. I would love to know what that feels like, having stood in a three-way marginal.
I was lucky to have my right hon. Friend the Prime Minister visit my constituency—not so lucky to have the Deputy Prime Minister—during the election campaign. I finally pay tribute to my fantastic campaign team. John Travis was my campaign manager. I have a fantastic family. My parents live just up the valley from me. I pay tribute to them. My mum and dad have never walked so much in all their lives. It takes about an hour to deliver to just three cottages because they have such long walkways. It is a privilege to be here today, but I am itching to get back up to the constituency this evening. The office is up and running, and I am looking forward to being out in Holmfirth and through the valleys over the weekend, representing the people who sent me here. There is a lot to do and I hope that I can do it with vigour and vim—and cheer on Huddersfield Town to promotion next season.
Roberta Blackman-Woods (City of Durham) (Lab)
I pay tribute to the hon. Member for Colne Valley (Jason McCartney) for his maiden speech. He had no need to be nervous; it was an extremely entertaining and informative maiden speech. I thank him for his kind comments about his predecessor, Kali Mountford. On the Labour Benches, we think of Kali with great affection, so we thank him.
I am pleased that mention has been made of the “Skills for Growth” White Paper, which has been important in defining our skills needs for the next few decades. As the Minister knows, the White Paper put particular emphasis on vocational skills and argued for a dramatic expansion of advanced apprenticeships, particularly for young adults. It also argued for the skilling of adults who are already in employment and those seeking work, and for improving the quality of provision in our FE and other institutions.
At the same time, “Higher Ambitions” set out equally challenging demands for our university sector. It asked universities to work with the Higher Education Funding Council for England to devise new funding incentives so that we could deliver higher education programmes that were more acutely related to the needs of the economy, and to work with the UK Commission for Employment and Skills to identify where new programmes were needed to meet areas of low demand. It set out the need to improve the relationship between universities and businesses and, crucially, to build better relationships between universities and regional development agencies. I noticed that the Minister was very quiet on that subject today, but as the Government are about to destroy the whole RDA framework, I should be interested to hear what he has to say about how universities and FE colleges will work with whatever structure is set up to ensure that regional development continues.
Mr Hayes
The hon. Lady will want to know that we are entirely committed to ensuring consistency—indeed synergy—between the economic development functions of local authorities and the work of colleges and other providers. If she is straightforward, I think she will acknowledge that according to the Public Accounts Committee and the National Audit Office, RDAs were not terribly effective in some of the work they did.
Roberta Blackman-Woods
I hear what the Minister says, but the new Government still have some way to go in setting out more generally how they propose to build on Labour’s progress in upskilling and reskilling our population, and particularly in outlining how some of the more strategic objectives on skills shortages will be met at regional level. That may not be easily deliverable at local authority level, so the Government have some more thinking to do about our regions.
The progress made under Labour was recognised by the UK Commission for Employment and Skills in its national skills audit, published earlier this year:
“Significant progress has been made in raising the qualifications levels of the workforce and stimulating supply over the last ten years, so that compared to other OECD nations our supply of highly skilled people is likely to place us 10th in the OECD by 2020.”
When Labour left office we were on track to move up the OECD league table in terms of the advances we had made in skilling our population. There is thus a considerable challenge to the Government to maintain that progress.
Similarly, recent publications from Universities UK and the Russell group comment on the strength of the university sector, while arguing that if current standards and quality are to be maintained investment must continue. We may hear something about that in the Budget next week, but it remains to be seen whether protection will be given for education not only pre-19, but post-19, so that we continue to be internationally competitive.
Not only did the Labour Government invest heavily in education generally, including further and higher education, but that investment was accompanied by a strategy to widen participation, to raise aspirations and to ensure that all young people who felt they could benefit from a university or a level 4 education had the chance to do so. I have not yet heard from the new Government whether they will continue to have that high level of aspiration for our young people. The Leitch review very much led us in that strategy. The Minister mentioned the review in his opening speech, but he did not mention whether this Government would keep the very demanding Leitch targets, which stated that 90% or more of the working-age population should have a level 2 qualification, 68% should have a level 3 qualification and over 40% should have a qualification at level 4 or higher. I would be interested to hear whether the Minister thinks those targets should stay in place.
Good progress was being made towards reaching those targets when Labour left office. The Liberal Democrats have often said—I often heard this during my election campaign—that although Labour had made advances in reskilling the population, those had been confined largely to the better-off. Interestingly, data from HEFCE show clearly that that is not the case. A HEFCE publication earlier this year, which looked at trends in young participation in higher education among different groups in England, stated that to overcome gaps in the data on disadvantage at an individual level, the study that it used looked at levels of disadvantage in local areas, taking figures from 8,000 census wards across England. The authors of the study also selected a range of indicators, and they said that, looking across the indicators, they had to conclude that since the mid-2000s young people from disadvantaged areas are substantially more likely to enter HE, that most measures of the gap in participation between most and least disadvantaged areas had fallen, and that the majority of additional entrants to HE have come from more disadvantaged areas. That means that Labour was not only upskilling the population, but it was extending access to higher education to those who had not previously been able to benefit from it. That is another substantial challenge for the new Government: they must—and we will be watching whether they continue to do so—extend opportunities and widen participation in the way that Labour did.
The audit that I mentioned earlier also talked about the importance of increasing skill levels further and identified key areas where there are skill shortages: in management and leadership, in professional skills, at the technician and equivalent level, at intermediate vocational levels and care services, and in customer service and general employability skills. It is important that we continue to make good those skill shortages.
The audit also identified key sectors where we need to be improving the skills levels of our young people and work force in the future if we are to remain internationally competitive. It was interesting to see the areas that had been outlined, which I think are familiar to all of us in the Chamber. They have been identified as low carbon; advanced manufacturing; engineering and construction; financial and professional services; the digital economy; life sciences and pharmaceuticals; the creative sector; care services; and retail, hospitality, leisure and tourism.
Our university and FE sectors are in a sense already embracing this brave new world, because they have already started to think of new ways of delivering courses that give much greater flexibility. I pay tribute to New College Durham for pioneering professional apprenticeships, for leading the drive for good-quality HE in FE, and for developing partnerships between HE and FE. I would welcome a visit to the college from the Minister, because he could meet the staff and see some of the fantastic work that is going on.
The Minister talked about international competitiveness in his opening speech. If we are to remain internationally competitive, we must keep our levels of reskilling high, which means that we will need to know how many young people and individuals in the work force are being skilled and reskilled. If we are not skilling sufficient people, we will need to put additional measures in place. That will mean that we will have to retain some targets, so I would like to hear the Government’s thoughts about that.
Jane Ellison (Battersea) (Con)
I am grateful for the opportunity to make my maiden speech and to follow my hon. Friends the Members for Milton Keynes South (Iain Stewart), for Romsey and Southampton North (Caroline Nokes) and for Colne Valley (Jason McCartney), and the hon. Member for Liverpool, Walton (Steve Rotheram), who set such a high standard. To pick up this afternoon’s running thread of football commentary, I am reminded by the presence in the Chamber of the right hon. Member for Tottenham (Mr Lammy) that he, the hon. Member for Chippenham (Duncan Hames) and I fought a by-election in June 2000 against the backdrop of a major international football tournament. I will not put hon. Members through the pain of reminding them of the outcome; suffice it to say that I hope we last a great deal longer this time.
In common with many new Members, I am conscious of the enormous honour that the people of Battersea, Balham and Wandsworth paid me by electing me as their Member of Parliament. It is a particular pleasure to be making my maiden speech during a debate on skills because I spent my whole working life with the John Lewis Partnership, which takes its commitment to training extremely seriously.
Over the centuries, Battersea has evolved from a village on the Thames famed for its market gardens, and particularly for its asparagus and lavender—hence Lavender Hill—into a 19th century industrial hub criss-crossed by railway lines. The railway lines are still there, but the heavy industry is largely gone. The factories along the river have been replaced by residential blocks. The constituency now has a younger average population than most and it is bustling and diverse. Indeed, it provides a London base for many hon. Members.
Much of the change over the past four decades was witnessed at first hand by John Bowis, the previous Conservative MP for Battersea—a good friend who was a great support to me throughout my campaign—and by my predecessor, Martin Linton, who has lived in Battersea for many years and represented his area first on the council, and then for 13 years as its Member of Parliament. Martin worked hard on behalf of his constituents and was greatly assisted by his wife, Sara. He showed passionate commitment to the causes close to his heart. As a councillor, he was closely involved in setting up the justly renowned Battersea arts centre, and the arts repaid him amply at the recent election when a star-studded array of actors urged people not to vote for me.
As a Member of Parliament, Martin championed, among other things, the cause of the Palestinian people. He worked tirelessly in an effort to secure the release of the last former British resident in Guantanamo Bay, Shaker Aamer, whose wife and children live in Battersea. I hope that the new Government will make progress towards a successful conclusion for Mrs Aamer and her children, and I am sure that my predecessor would take satisfaction in such an outcome, given his sustained and energetic campaign.
Championing the unfashionable cause is very much in the Battersea tradition. The area has long nurtured radicals of all kinds, including many of the abolitionist evangelicals of the Clapham sect and John Burns, the firebrand union leader and MP. In the early 20th century, Battersea gave Britain its first black mayor and one of the first Asian Members of Parliament.
When I was selected to fight the constituency, someone who was not local to the seat asked me, “What’s there other than a dogs home and a power station?” Of course, there is much more to the constituency than that. We have some wonderful green spaces—Battersea park, Clapham common and Wandsworth common—more than 125 listed buildings, an energetic civic life and an even more energetic social life. Despite its name, Clapham Junction, which is one of the most famous stations in the world, has always been firmly in Battersea. We were graced for years by Young’s, one of London’s oldest breweries, and we are now home to one of its youngest: Sambrook’s. Battersea has also been the proud home of the London Regiment of the Territorial Army for many years.
Many of the radical social changes over the past 150 years in Battersea can be seen in the history of the Bolingbroke hospital in my constituency. The hospital was founded as a result of the energy and compassion of a great Victorian, Canon John Erskine Clarke, a notable Battersea vicar. He identified a need for a hospital for what were then described as the artisan classes of Battersea, who were prepared to pay, either wholly or in part, for their care. In 1880, the Bolingbroke Self-Supporting Hospital and House in Sickness opened, funded by a host of local beneficiaries and by public subscription. It was expanded and adapted over the years and was brought within the NHS, and it remains a much-loved local institution. Although it was earmarked for closure in 2006, a tenacious local campaign was conducted, led by the hospital’s League of Friends—a group, made up mostly of women, which, for over 100 years, has exemplified the very best of British volunteering. Its members have quietly and consistently given their time to fundraise, and to provide support and succour to patients and their families.
However, the Bolingbroke closed its doors as a hospital in December 2008 and now awaits its fate. Many of us in Battersea hope that the next chapter in its life story will be as a school. For the parents involved in the Neighbourhood School Campaign, supported by Wandsworth council, the free schools legislation offers the best chance of realising their dream of a new state secondary school for south Battersea. A new school would be enormously important, giving further choice to parents in my constituency, irrespective of their means—an important factor in an area that has a lot of families on low incomes. I therefore particularly welcome the coalition’s plans for a pupil premium and more apprenticeships, and its determination to boost the private sector. All those things will greatly assist the many young people in my constituency for whom life is a struggle against the odds from the start, and for whom a good education and a skilled job are an essential way of getting on in life.
I return briefly, if I may, to the Battersea Dogs Home and the Battersea power station. The world-famous dogs and cats home celebrates its 150th anniversary this year, having been founded by the redoubtable Mrs Mary Tealby at a time when life for the human poor of this city was very harsh, and for the unwanted animal even harsher. The home remains on the front line of animal welfare in London and beyond, and has a key role to play in policy development, particularly in contributing to the debate about dangerous dogs and their often even more dangerous owners.
Battersea power station first provided energy to London in 1933. Its opening was accompanied by protests about pollution and widespread derision of Sir Giles Gilbert Scott’s now iconic exterior design—perhaps a salutary reminder to us about not rushing to judgment on new buildings. The largest brick building in Europe, the power station was listed in 1980 and last generated electricity in 1983. It has lain dormant ever since, as plans for its future use came and went. Most recently it starred in “Ashes to Ashes” and, of course, the Conservative manifesto launch, but most people in my constituency want to see the power station star in the regeneration of the Nine Elms area of east Battersea.
With over 200 acres of development land, right here in the heart of this great city, and merely a mile from this place, Nine Elms hopes to welcome the new American embassy and the underground in the next 10 years. The scheme will also mean the redevelopment of the New Covent Garden market, the largest fresh-produce market in the UK. It is a thrilling, once-in-a-lifetime opportunity for Battersea and for London. I know that there are sceptics, but I hope that they will be confounded, that Nine Elms will become an exciting new riverside quarter, and that the power station will live again.
When completed, the redeveloped Nine Elms area will host thousands more homes and businesses. That will also make my constituency bigger, so no need for boundary changes in Battersea. The construction of the new east Battersea is itself a fantastic opportunity. If one glances inside the derelict turbine halls of the power station, or at the art deco fittings in the control room, one is reminded of the care that was taken in its construction. As the daughter of an engineer, I feel passionately that the renewal of the power station and the wider area is a chance for hundreds of apprentices to hone their skills. I want many young people from our area to get their chance for training and employment in the transformation of east Battersea, so that they can look with pride on their area and say, “I helped to build that.” This morning I visited the Astins institute, set up and run by a private sector company with a view to doing just that and equipping people with those skills. I hope that the Government will urge all employers to take their skills training responsibilities very seriously.
Battersea is also home to the South Thames college, an excellent higher education college passionate about equipping its students with the skills to take their opportunities in life. The Minister of State, Department for Business, Innovation and Skills, my hon. Friend the Member for South Holland and The Deepings (Mr Hayes) visited South Thames last year, and many of the measures mentioned today will be very much welcomed in that quarter, and in other further education colleges around the country.
A great parliamentarian, Benjamin Disraeli, vividly described the two nations of Britain in 1845. In some regards, they are still with us, but it is my hope and belief that the coalition Government’s programme will retain at its core the goal of creating one nation, in which all young people can discover and fulfil their potential.
I pledge to do my very best for my constituents and to be a good parliamentarian. I commend the motion to the House.
Chris Williamson (Derby North) (Lab)
I welcome you to the Chair, Mr Deputy Speaker, and congratulate you on your elevation to such an important role. I also congratulate the hon. Members for Milton Keynes South (Iain Stewart) and for Romsey and Southampton North (Caroline Nokes) on their maiden speeches. I particularly congratulate the hon. Member for Colne Valley (Jason McCartney), who, I note, has managed to get his office up and running, a feat that has defeated me so far—well done on that. I also congratulate the hon. Member for Battersea (Jane Ellison). I note your reference to animal welfare, which is a passion I share, and I hope that, if and when the time comes, you will join Labour Members in voting against any attempt by your party to reintroduce fox hunting in our country.
Mr Deputy Speaker
Order. Could the hon. Gentleman please direct comments through the Chair? If you say “you”, it refers to me.
Chris Williamson
I beg your pardon and thank you for that correction, Mr Deputy Speaker. I will endeavour to ensure that I do not make that mistake in future.
Building a high-skilled economy is vital to the future prosperity of our country. I represent a constituency that is founded on a high-skilled economy. In a previous speech in the Chamber, I referred to the occasion when Jeremy Paxman said, “Why can’t everywhere in Britain be like Derby?” That is because we have been successful in Derby in developing a high-skilled economy. We were fortunate in having Rolls-Royce and Bombardier, which have done so much to create a high-skilled economy, in the city. The country could learn a lot from Derby.
We have invested heavily in the city, thanks to support for training from the Labour Government. We have an excellent university and two new colleges, which undertake extremely important vocational training, preparing young people for the world of work. We built 13 new schools under the Labour Government and employed many new teachers and teaching assistants, who are essential to developing a high-skilled economy.
However, the Conservative party’s policies are taking the country in the wrong direction if we want to develop a high-skilled economy. The Conservatives are making the same mistakes that were made in the 1980s, when the previous Conservative Government systematically undermined and destroyed manufacturing—the bedrock of the greatness of our nation. They took away opportunities for young people to move into work and get the training that they needed.
Kwasi Kwarteng (Spelthorne) (Con)
In a debate that took place yesterday, the Minister for Universities and Science pointed out that manufacturing had collapsed even further under the Labour Government than under 18 years of the Conservative Government. I quote from memory, but it went from some 22% to 18% of GDP between 1979 and 1997, and had decreased to some 11% by 2009.
Chris Williamson
The hon. Gentleman is being a little unfair. He fails to recognise the huge expansion in the service sector. We can play with statistics, but in the 1980s, there seemed to be a clear policy of undermining manufacturing in this country. The car industry was destroyed and the steel industry was undermined.
Jacob Rees-Mogg (North East Somerset) (Con)
Labour Members consistently harp on about how Conservative policies in the 1980s affected manufacturing, but will they say something about the damage done to industry by the aggressive trade unionism of the 1970s and 1980s, and might they take the plank out of their own eye before they look at the mote in ours?
Chris Williamson
Labour Members harp on about the 1980s because of what happened then. The policies of the previous Conservative Government damaged the car industry and shipbuilding, and manufacturing right across the piece in our country. It is completely wrong to blame trade unions for the systematic destruction of manufacturing in this country.
Gordon Birtwistle (Burnley) (LD)
Will the hon. Gentleman comment on the actions of Red Robbo, who closed down the old Austin Rover plant in the 1970s?
Chris Williamson
Again, hon. Members on the Government side of the House are demonising trade union activists, but Derek Robinson, to whom the hon. Gentleman referred colloquially as Red Robbo, was simply arguing for more investment in the car industry. He was saying that if the car industry did not get the support that it needed, it would fail and be overtaken by our competitors in Japan and Germany. His predictions—dare I say?—actually came true, because the car industry in our country was completely destroyed as a result of Conservative policies.
The Conservatives are making the same mistakes not only in policy pronouncements, but in practical matters. Only this morning, the Transport Minister made it very clear that there will be no further orders for rail transport rolling stock. Many people in my constituency work for Bombardier, which is the last train manufacturer in the UK, and they were relying on the possibility of securing the Thameslink contract. However, it now seems, after what the Transport Minister said this morning, that there is no prospect whatever of Bombardier securing that contract this year. That will certainly lead to redundancies and make it much more difficult for young people in training colleges in my constituency—if they have been given that opportunity—to get the real jobs that are crucial to securing a high-skilled economy, as my hon. Friend the Member for Ealing North (Stephen Pound) said.
Dr John Pugh (Southport) (LD)
The hon. Gentleman talks about the British train industry and construction in this country, but does he think it was a good idea that the previous Labour Government placed so many orders for extra carriages in Japan?
Chris Williamson
Clearly, we live in a global economy, in which orders are placed with different companies around the world—Bombardier won some contracts, but some went abroad—but the fact is that the Transport Secretary said this morning that there is now no prospect of Bombardier getting the Thameslink contract.
Stephen Pound
Does my hon. Friend agree that one tragedy of current British manufacturing and skills is that contracts occasionally have to go to countries such as Japan, which has invested more in Bullet train technology and other high-speed train technology, and that that underlines precisely the point he is making?
Chris Williamson
Absolutely—my hon. Friend makes a pertinent point. If we were to follow the lead of some of our competitor nations by investing appropriately in skills, we would put our country, our young people, and the people who work in those sectors, in a much better position to secure their long-term future.
The parties opposite have also made proposals for the regional development agencies. The RDAs have played an important role, and the East Midlands Development Agency has made an important contribution to supporting industry in the east midlands and in Derby. That has helped to create the job opportunities and the growth that are so desperately required.
We must not indulge in a race to the bottom. The Government seem to want us to move to a low-wage economy, but there is no future in that for this country. We simply cannot compete on that basis, because we will never match developing nations such as India, China and others and the wage rates paid to workers there. We must invest in those high skills that Derby excels in through companies such as Rolls-Royce and Bombardier. That is why I regret the announcement this morning about Bombardier, which will almost certainly lead to redundancies. If we do not support such companies, they could go elsewhere, because they are global, and they will simply bid for contracts from their European bases.
If there is a market failure, it is essential for the state to intervene and smooth out the difficulties, such as those afflicting the country as a result of the worldwide economic downturn. If we do not do that, it will cause significant problems for the economy—and for young and old alike. No jobs for people means lower tax revenues to support our public services, and we will end up in a downward spiral to disaster.
Gordon Birtwistle (Burnley) (LD)
Like other hon. Members, I wish to congratulate the hon. Members for Romsey and Southampton North (Caroline Nokes), for Liverpool, Walton (Steve Rotheram), for Colne Valley (Jason McCartney), for Battersea (Jane Ellison) and for Milton Keynes South (Iain Stewart) on their maiden speeches. I made mine a few weeks ago. Like the hon. Member for Liverpool, Walton, I did an apprenticeship, and it is some 52 years since I turned up in my brand- new boiler suit and boots at a large engineering company in Accrington called Howard & Bullough, then the world leaders in machines for textile making. Regrettably, it is no longer with us, like so many other companies from that time.
I agree that it is critical to build a higher-skilled economy. We need to deliver the skills that will deliver the jobs of the future, in engineering, chemicals, medicines, nuclear technology—both commissioning and new build—and the internet. Such high-tech, high-value jobs will deliver the products and services that are needed round the world. Only 12 months ago, when I was leader of Burnley borough council, we heard that Rolls-Royce was developing a new engine for a new range of airliners. Hon. Members may not know it, but over the next 25 years the single-aisle aeroplanes such as the Boeing 737s and Airbus 320s will all be replaced. The cost of replacing these will be in the region of $3 trillion. The power packs and engines required for those aeroplanes will cost in the region of $600 billion. That is a hell of a lot of work for the people who produce the aeroplanes and the engines and power packs to go with them.
I approached the leader of Derby city council and we visited Rolls-Royce, where we asked the main board whether these engines would be developed in the UK. It said not and that it was hoping to develop them in Germany, Singapore and the far east. It also said that wherever it develops the engine it will most likely build it—$600 billion of work that could have been done in this country now might go abroad.
I asked the Rolls-Royce board whether there was a financial inducement to building the engine overseas, and it replied, “No, there is no financial inducement. In fact, it will cost us more money to develop this engine overseas.” The question went back, “Then why are you doing it?”, and the question was put back to us, “Can you deliver 3,000 to 5,000 qualified, highly skilled graduates to design, build and develop this engine?” The answer from all present was, “Unfortunately, no.” Rolls-Royce replied, “If you can’t deliver the skills we need, we have no alternative to going abroad to develop this engine.” Some $600 billion of work over 25 years! That is an appalling situation and an indictment of the last 30 years in the development of the skills of engineers and technicians that we need in this country. It has to stop, and I am delighted that we are at least starting to deliver what industry needs for the future jobs of this country.
The town I represent has just got a brand new college on its university campus—a campus that is dedicated to advanced manufacturing. The borough council invested more than £150,000 in a brand new, high-tech machine shop, which I would like the Minister to visit. I invited Rolls-Royce representatives to come and see this new machine shop. They came all the way from Barnoldswick, and while they were there, they had a conversation with the people from the university of Central Lancashire and decided that because the new advanced engines would nearly all be made from carbon fibre, particularly in the cold engine section—the hot engine section will obviously still be made from metal—they would like to work with the UCLan campus to develop it. The university has therefore purchased an autoclave to develop carbon fibre turbine blades for Rolls-Royce. That is the advancement that this country needs and that will stop some of the work going abroad. We need to support colleges in acquiring the equipment that companies around the country need and in developing new technologies, and I am delighted that this has happened.
UCLan campus academics have developed what they believe to be the most efficient wind turbine in the world. It is only small—about 1 metre across—but they have found that it has the most advanced centre bearing in the world. We approached a local company, and it agreed to put £1 million into the development of the wind turbine to make it big enough to use onshore. It has a 15-metre autoclave in its factory and can make carbon fibre blades for the wind turbine. Through the borough council, I asked the previous Government whether they would support the development of the wind turbine, a vast number of which will be needed over the next few years. As everybody knows, we do not make wind turbines in this country—we buy them from abroad—but unfortunately the previous Government did not want to support the scheme, so it has died and the wind turbine is sat in an office in Burnley, waiting for someone to support its development. It would cost about £4 million, but would create thousands of jobs and save having to import wind turbines from abroad. The local company was willing to take up some of the loss, but unfortunately the scheme was rejected. That is very sad in these days.
We need to invest in new developments and in the people to deliver them. We cannot stand by and look back; we have to move forward and provide the skilled people of the future, and I hope that what we are doing with the 15,000 apprentices and what we are proposing to do about advanced manufacturing will deliver the people of the future, doing the jobs of the future and providing the work of the future.
Mr Adrian Bailey (West Bromwich West) (Lab/Co-op)
I, too, welcome you to the Chair, Mr Deputy Speaker. This is the first time I have had the privilege of speaking in the Chamber while you have been in the Chair. May I also congratulate all those new Members who have made their maiden speeches today? I have not heard them all, but I have certainly heard most of them, and on the basis of what I have heard, those Members are going to make a significant and worthwhile contribution to the Chamber while they are here.
This debate, above all, is supremely relevant to my constituents. West Bromwich West is a traditional manufacturing constituency that suffered enormously in the 1980s from the policies of the then Government. Unemployment rocketed, which resulted in the creation of a generation of people who saw no prospect of employment, and a culture of low aspiration, low expectation and low skills and training. Members said earlier that we should not live in the past. That is quite correct. On the other hand, it is important that we look to the past and learn from the mistakes that were made, so that we do not replicate them.
The mass unemployment in my constituency in the 1980s and the substantial reduction in the manufacturing sector resulted in a skills gap that, despite all the efforts of the Labour Government, has not fully been closed. Even as the economy and employment opportunities improved, there was still higher than average unemployment in my constituency, and employers complained to me that the skills they needed still did not exist locally. The reason was that in the 1980s, as the economy went into recession on two occasions and manufacturing collapsed, no efforts were made to pick up those who had been made unemployed and retrain them with the skills to fill the opportunities that would subsequently be created as our economy grew out of recession. The result of that was a drag on the local economy throughout the past 10 years of the previous Government, as they implemented policies that led to economic growth.
What we must not see is the recent recession and the fragile growth that we have seen since then operating in the same way. It is fair to say that the previous Government recognised that a recession provides an opportunity for those who cannot immediately get jobs or who have been thrown out of their jobs, given the right support, to get the appropriate training and skills that they have hitherto not had the opportunity to get, so as to equip them for the new jobs that will be created in the future. That I know was what was behind the previous Government’s approach to dealing with the problem over the past two or three years.
The current situation presents an enormous problem in that respect, although I would not pretend that it had arisen entirely as a result of the cuts that have been announced over the past two or three weeks. There were potential problems beforehand, particularly with the number of young people wanting to go into higher education and the places not being available. However, it was the previous Government who made provision for 20,000 new places and who put a particular emphasis on providing the budget for the key STEM subjects—science, technology, engineering and maths—which are vital if we are to equip manufacturing to take us out of recession. I have not heard any guarantees that this Government are going to ring-fence the funding for STEM subjects in universities to ensure that this area, which is so vital to our future, is sustained. This is particularly important because a number of universities are already reporting that, because the provision of those courses requires higher capital investment, they could be the first on the list to be removed. We could therefore be undermining our scientific, engineering and mathematical potential in vital sectors, at a time when it is so necessary to get us out of recession.
I also want to talk about a subject that I have not heard mentioned so far—the education maintenance allowance. In constituencies such as mine, where people have low incomes and, historically, low aspirations, the provision of that allowance is essential to give young people the confidence to go into further education and, eventually, higher education. With the increase in competition that is likely to arise for the lower number of university places—it might not be lower in absolute terms, but it could be lower, relative to the demand for them—there is a danger that young people from low-income and low-aspiration backgrounds could be crowded out of the competition for the scarce places. That will make the EMA strategically even more important than it has been in the past, if we are to ensure that university opportunities are open to people from all backgrounds and incomes.
Amber Rudd (Hastings and Rye) (Con)
I wonder whether other hon. Members receive complaints about the education maintenance allowance, as I do. I, too, represent a constituency where there are people on very low incomes, but I get a lot of complaints that the allowance is badly applied and often abused.
Mr Bailey
Certainly in its early days there were some complaints, but they have not been reflected in my constituency. I had a meeting with the principals of my three local further education colleges only two weeks ago, and they stressed to me and my neighbouring Conservative MPs the important role that the allowances play in keeping young people between 16 and 19 in education in our area. I want to emphasise to the Government that they need to sustain the EMA as part of the infrastructure necessary to ensure that their stated policy of open opportunity for young people in universities can be maintained.
My hon. Friend the Member for Cardiff West (Kevin Brennan) mentioned the transfer of money from Train to Gain into apprenticeships and capital for colleges. I want to make one comment on Train to Gain. I find it odd that, if it is so bad—the National Audit Office certainly had criticisms of it—it has not been abolished and the money transferred elsewhere lock, stock and barrel. The Government seem to have created a hybrid system. My experience of speaking to local employers is that Train to Gain was extremely beneficial, and there is a whole raft of statistics that substantiate their claims for the programme. Train to Gain was also essential for many companies that had introduced short-time working, to help them to sustain a level of income for their employees to prevent them from going elsewhere or leaving the jobs market altogether, and to prevent the companies from losing their skills.
I also want to say a few words about bureaucracy. When Labour was in government, it was a constant theme among the Conservatives that we were strangling education with top-down bureaucracy. Certainly, when I went round schools, I heard complaints about excessive paperwork and bureaucracy, and I cannot pretend for a moment that we were able to solve that problem. I am concerned, however, that despite all the coalition Government’s brave words, they seem to be heading the same way.
Earlier, I drew to the attention of the Minister of State, Department for Business, Innovation and Skills, the hon. Member for South Holland and The Deepings (Mr Hayes), a statement he placed in the Library today about getting FE colleges to give
“learners the information they need to drive the system, through the publication of clear and consistent information about performance, quality and standards.”
That sounds like fairly top-down instruction, a recipe for extra research that has no particular relevance to the people being educated, and a whole lot of form filling and publications that will siphon off money that could well be used in other directions. I sympathise with the Minister up to a point, because it is a perfectly laudable objective, but the new Government have to realise that having laudable objectives and ensuring that they are translated at the local level involves some sort of imposition and resources that have to be calibrated and calculated to ensure that they are worth while.
I am coming to the end of my comments, but let me say that in my new position as Chairman of the appropriate Select Committee, I look forward to talking to Ministers and interviewing them on their policies. I wish them well, as this matter is absolutely vital not just to my constituents but to young and unemployed people everywhere and to this country’s future and its position in the global economy. Investment in skills is as important as investment in plant and machinery, and it has the additional benefit of improving the lives of those who are prepared to get involved.
Andrew Stephenson (Pendle) (Con)
First, let me say how delighted I am to see in the Speaker’s Chair a neighbouring MP who has given me so much support over the years. I should like to pay tribute to other hon. Members who have made their maiden speeches today: the hon. Member for Liverpool, Walton (Steve Rotheram) and my hon. Friends the Members for Milton Keynes South (Iain Stewart), for Romsey and Southampton North (Caroline Nokes), for Colne Valley (Jason McCartney) and for Battersea (Jane Ellison). The last is a good friend; she stood in my constituency back in 2005, and she is still remembered fondly in the local area.
To stand here and make my maiden speech is a tremendous honour, particularly in the light of those who have previously represented the constituency of Pendle, or, as it was formerly known, of Nelson and Colne—men such as Sidney Silverman, David Waddington and, for the past 18 years, Gordon Prentice. In fact, while researching for my own speech, I learned that Sidney Silverman’s maiden speech back in 1935 lasted 22 minutes and was on the merits of socialism. I am delighted to tell you, Mr Deputy Speaker, that I can both make a maiden speech and dismiss the merits of socialism within 22 minutes.
It is traditional to start a maiden speech by paying tribute to one’s predecessor, and despite the fact that Gordon Prentice was my opponent in the recent election, I have no hesitation in doing so. Gordon Prentice was a principled politician and committed to many causes. He was an independent thinker who rebelled against the last Government on issues such as tuition fees, the Iraq war and post office closures. He was an active Back Bencher and I feel that Gordon demonstrated to us newer Members that we do not have to hanker after ministerial office to achieve something in the House.
As I said in my acceptance speech just five weeks ago, it is the greatest honour of my life to be elected to represent Pendle. Located in the hills of the Pennines in north-east Lancashire, and some would say beyond, Pendle offers some of England’s finest countryside, including Pendle hill, from which my seat takes its name, as well as beautiful villages and busy towns.
The area is rich in history, not only with the story of the Pendle witches, which brings many visitors to the area, but with our industrial heritage with the Leeds-Liverpool canal, numerous mills and other incredible feats of engineering. The old industries of cotton and textiles have now all but disappeared, but the industrious spirit of the area remains as strong as ever.
Next weekend, my constituency plays host to one of the biggest events in the UK’s cycling calendar, with the national road race championships taking place through the villages of Roughlee, Barley and Newchurch. It is a great opportunity for us to showcase some of our award-winning villages and boost the local tourism trade, which is an increasingly important part of the local economy.
Pendle is a place of contrasts, where we have severe deprivation next to relative affluence. It is a place where mosques sit side by side with mills, highlighting the large number of my constituents who came originally from Pakistan or Kashmir. One of the first issues with which I had to deal as a Member of Parliament was the senseless murder of three of my constituents, the Yousaf family. They were gunned down while tending a family grave in Pakistan. Their killers are yet to be brought to justice, and I am committed to doing whatever I can to ensure that the family obtain justice through the Pakistani courts. On that issue as well as many others that affect my constituency, I will be at the forefront in pressing Ministers and holding the Government to account, so that the people of Pendle always know that they have a strong voice here in Westminster.
The M65 ends in my constituency, in effect creating one of the biggest cul-de-sacs in the country. As a result, most of those who wish to travel cross-country by road take alternative routes. We also lack rail connectivity. I pay tribute to the work of SELRAP—the Skipton East Lancashire Railway Action Partnership. That group’s aim is to reconnect Colne and Skipton, Lancashire and Yorkshire, and the north-west and the north-east, and I applaud its efforts.
We have some of the lowest house prices in the country. There is a high rate of empty and unfit homes, as people have moved away from the area and absentee landlords have bought homes and sometimes entire streets. It is clear to me, representing as I do some of the cheapest streets in Britain, that regeneration work remains vital to the long-term sustainability of the area.
We lack an accident and emergency department since ours was transferred from Burnley to Blackburn—which is 15 miles away—under the last Government, despite the protests of local people. The local primary care trust now wants the children’s ward to be transferred as well, but I am encouraged by the assurances of the Secretary of State for Health that NHS service changes are now subject to review. I look forward to him visiting Burnley general hospital tomorrow, along with my hon. Friend the Member for Burnley (Gordon Birtwistle), who made an excellent speech a few moments ago.
The people of Pendle are hardy folk, and we face up well to whatever situation we find ourselves in. That is probably best typified by one of Pendle’s most famous sons, whose memorial in Colne is close to where I live: Wallace Hartley. Hon. Members who are not familiar with the name will, I am sure, be familiar with the story: Wallace Hartley was a violinist, but he was also the bandmaster of the Titanic on her maiden voyage.
I am proud to represent a seat where a higher proportion of the work force are employed in manufacturing than in any other constituency in England, and I am delighted that manufacturing is back on the national agenda. I was also delighted to read in the coalition agreement that rebalancing the economy is a key Government aim and that the Government are committed to boosting the provision of workplace apprenticeships.
More than 8,000 people in my constituency are employed in manufacturing, producing everything from Silentnight beds in Barnoldswick to the biscuits that are sold in Harrods, which are produced in Nelson. It was a real pleasure for me, as a candidate, to visit so many of those firms over the past four years. It was a particular pleasure to take my right hon. Friend the Member for Tatton (Mr Osborne), now Chancellor of the Exchequer, to visit Rolls-Royce and Weston EU—two great British companies, working in the vitally important aerospace sector, that also have fantastic apprenticeship schemes. They are real companies providing real jobs that generate significant value added for the United Kingdom. That brings me to the topic of today’s debate: the need for us to build a high-skilled economy.
Last Friday, I had the pleasure of visiting Nelson and Colne college. The college has a long-standing tradition of academic excellence, and since 2005 it has twice been judged “outstanding” by Ofsted. It provides academic and vocational sixth-form education for about 1,700 people—the vast majority of young people in my constituency—but I believe that among the things that make it so special are its unique pre-professional programmes and its outstanding apprenticeship provision, with success rates well above the Lancashire and national rates. Its tailor-made employer provision includes 14 individual apprenticeship frameworks to meet the needs of local and regional employers.
It would be far better to address the current skill shortages in the economy by supporting colleges such as Nelson and Colne and fostering their links with business than by pursuing the last Government’s attempt to ensure that 50% of students went to university. However, we must also recognise that four out of five people who will be working in 2020 are already in the work force. Given the damage done to occupational pension funds by the last Government and the probable increase in the state pension age, people are likely to be working for much longer than ever before. So we must have a strategy that ensures that training is not just focused on young people but provides incentives to employers to support lifelong learning and celebrates the good employers who are already doing that.
We also need a fair deal for British manufacturers, so that we can continue to be a world leader in sectors such as aerospace. British industry has been hampered by too much tax and regulation for too long. We know that tough times lie ahead because of the legacy left to us by the previous Government, and that will make building a high-skilled economy even harder. However, I look forward to working with the Government to address the challenges that we face, while never shying away from speaking out on behalf of the hard-working people of Pendle.
Martin Vickers (Cleethorpes) (Con)
May I congratulate both you, Madam Deputy Speaker, on your appointment and the other Members who have delivered their maiden speeches this afternoon? In preparing my notes for this speech, I turned, as I am sure colleagues also did, to the guidance; I noted that it says that it is best to be brief and non-controversial and—at least on this occasion, Madam Deputy Speaker—I shall try to be both.
It is, of course, a great privilege to be elected to the House, particularly for me as I represent the constituency that bears the name of my home town. That makes me both a Lincolnshire yellowbelly and a meggie. The explanations behind those terms are somewhat dubious, and although I appreciate that Members are on tenterhooks to know them, I shall leave that for another day.
Members and others who have been fortunate enough to visit Cleethorpes—which, as they will all be aware, is the premier resort of the east coast—are referred to by us locals as “trippers”, and they are the lifeblood of the town’s economy. The constituency is, of course, much more than Cleethorpes itself. It runs from the delightful market town of Barton-upon-Humber in the north through many villages in the Barton and Ferry wards of north Lincolnshire and on into north-east Lincolnshire and the major industrial centre of Immingham, which together with Grimsby has, when measured by tonnage, the largest dock complex in the United Kingdom. The seafaring traditions are strong, and Cleethorpes and Grimsby are, in effect, one town. Although there is an historic rivalry between them, they are bound together by their connections with the sea. The Humber estuary itself is a site of special scientific interest, and there is also a beautiful hinterland taking in many of the villages on the edge of the Lincolnshire wolds—an area that has been designated an area of outstanding natural beauty.
Cleethorpes is also the home of Grimsby Town football club, which therefore, strictly speaking, always plays away from home. The club has had a difficult few seasons of late, but I am proud to be a lifelong Mariners fan, and I am confident of better times ahead. Bill Shankly has been mentioned on two occasions this afternoon, and it is perhaps appropriate in a debate about training to mention that he served what might be called his managerial apprenticeship at Blundell Park before going on to higher things. I cannot quite remember the early ’50s, but I did live within shouting distance of the terraces of the football ground. The area is also fortunate to be served by an excellent combination of newspapers, which together help to create the identity of the area. There are two dailies, the Grimsby Telegraph and the Scunthorpe Telegraph, and a weekly, the Cleethorpes Chronicle.
Having given Members a snapshot of the constituency, I wish now to pay tribute to my predecessor, Shona McIsaac, who represented Cleethorpes for 13 years, during which time she worked diligently on behalf of her constituents and tirelessly for the causes in which she believed. Having worked for almost 16 years for my hon. Friend the Member for Gainsborough (Mr Leigh), I know well that many individuals have cause to thank their Members of Parliament for taking up cases, trying to correct an injustice or bringing an issue to the attention of those in authority. On their behalf, I thank her for her efforts in that respect. She was, of course, bitterly disappointed to have lost her seat but was gracious in defeat. I wish her well for the future.
Cleethorpes, although it has been pushed from one constituency to another over the years, has had some notable, interesting and perhaps even colourful Members in the past. Before Shona McIsaac came Michael Brown, and before that Michael Brotherton and Jeffrey Archer.
I referred earlier to my hon. Friend the Member for Gainsborough, who has just completed nine years as a distinguished Chairman of the Public Accounts Committee. I had the privilege of working as his constituency agent for 16 years, and he started me on the path that has led me to the House: 10 years ago, after addressing the Cleethorpes Conservative luncheon club, he suggested that I might try to become the candidate.
Today’s debate focuses on building a high-skilled economy, and that is of particular importance to my constituency, with its large concentration of industry along the Humber bank. As the new Member for the constituency of Cleethorpes, I shall aim to build on the work of my predecessors and the work done by local authorities, industry and the many different agencies that come together to reinvigorate and redevelop an area with which I have been associated throughout my life.
We must develop further a high-skilled economy that will benefit my constituency and the whole country. We can then progress out of this economic downturn more fully. We need to set the foundations for the future success that our young people deserve. It is our younger generations who will be the backbone on which the future of businesses relies. My fellow Lincolnshire Member, the Minister of State, Department for Business, Innovation and Skills, my hon. Friend the Member for South Holland and The Deepings (Mr Hayes), described this in his opening remarks as a major challenge. I welcome the Government’s pledge to increase the quality and quantity of apprenticeships that will be available.
I hope that such pledges will further the work of facilities such as CATCH—the Centre for the Assessment of Technical Competence, Humber—and training providers such as HETA, the Humberside Engineering Training Association, which operate there. During the election campaign, the Minister for Universities and Science, who was then a shadow Minister and is now, I am pleased to say, a member of the Government, visited the CATCH facility in Stallingborough and I think it fair to say that he was suitably impressed. It is a joint venture between the public and private sectors, and it has an extremely good success rate in securing permanent positions for the young people who train there, educating and training today’s school leavers, so that they become not a lost and forgotten generation but a driving force behind the economic recovery that remains the key aim of Government policy.
With its industrial history and foundation along the Humber bank, the people of my constituency are hard-working people. Cleethorpes has a number of challenges and obstacles to overcome to secure the support and funding that is needed to ensure that the Government’s vision of a fair and highly skilled economy is brought to all the constituencies of our country. As the Member of Parliament for the constituency, I hope to act as something of an ambassador, bringing together all the elements of the constituency—whether private, public or third sector—that will help to build the future success of our economy. If we work together, I am confident that my constituency will enjoy a brighter future.
Mel Stride (Central Devon) (Con)
I offer you my congratulations on your election, Madam Deputy Speaker. I also congratulate all those who have made maiden speeches this afternoon, not least my hon. Friend the Member for Cleethorpes (Martin Vickers), who spoke eloquently about his constituency and, like many others this afternoon, on the subject of football. As someone whose wife—who is in the Gallery today—is a fan of Liverpool football club and has, in my opinion, a rather worrying keenness on Steven Gerrard, I, like my hon. Friend the Member for Colne Valley (Jason McCartney), will be trying to make the early acquaintance of the hon. Member for Liverpool, Walton (Steve Rotheram).
I am proud to address this House for the first time as the first Member of Parliament for Central Devon. My constituency was formed from parts of five others, so it could be said to have five predecessors, two of whom I am pleased are still Members of the House. First, there is my hon. and learned Friend the Member for Torridge and West Devon (Mr Cox), who has set the highest standards in looking after his constituents—standards to which I aspire. Like most lawyers, he has never been slow to offer me wise counsel, but unlike most lawyers he has very graciously never charged me a penny for it. There is also the Minister for the Armed Forces, my hon. Friend the Member for North Devon (Nick Harvey). Although he is not a member of my party, he is often held by my constituents who were previously represented by him to be a bit of a Tory at heart. I am sure that that will be a good qualification for his new role as a Minister in our coalition, and I wish him well.
There are three other predecessors who are no longer Members of the House, the first of whom being Anthony Steen, who served as the Member for Totnes. I have found him to be immensely courteous always and sometimes marvellously eccentric. He is a compassionate man who has done a great deal of good, not least through his work addressing the dreadful situation of human trafficking, and I am sure that he will be missed by the House. Secondly, Richard Younger-Ross was the previous Member for Teignbridge, and a very hard-working and assiduous local Member of Parliament.
Lastly, and for me most importantly, I pay tribute to Angela Browning, the former Member for Tiverton and Honiton, who was held in great affection on both sides of the House. She could not have been more supportive, generous and helpful to me. She was hugely respected by her constituents, regardless of their political leanings, and I am delighted that she has now been elevated to the other place. In the coming months, I shall try to live up to these illustrious forebears, to be inspired by their example and to contribute to the House as they have done.
Central Devon is one of the most beautiful constituencies in the country. It is also one of the largest, covering some 550 square miles, including a third of Dartmoor national park, numerous beautiful and scattered villages and several fine market towns such as Okehampton, Hatherleigh, Chagford and Crediton, where, some Opposition Members might be pleased to learn, Ernest Bevin was schooled. They are welcome to come and visit, but strictly out of election time if they do not mind. Other market towns include Buckfastleigh, Ashburton, Bovey Tracey and Chudleigh.
My constituency is steeped not only in beauty but in history. In my home town of Ashburton, a once important stannary town occupied with the trading of tin, there still exist two venerable and ancient offices—portreeve, the representative of the monarch, and master bailiff. Both of those offices stretch back to the early 9th century, well before even your illustrious office had been conceived, Madam Deputy Speaker, and indeed to a time when the ground on which we now stand was little more than a marshy outcrop of the River Thames. I offer my congratulations to Mrs J. Distin, Ashburton’s newly elected portreeve, who is the 1,189th holder of that office, and to Mr W. Shapley, our master bailiff.
Although Central Devon is an area of outstanding beauty and interest, it is not without its challenges and hardships. It is a constituency in which agriculture matters, so events that hurt agriculture have a major impact upon my constituents. In 2001, the foot and mouth outbreak was centred around the market town of Hatherleigh, with devastating effects. The pall of smoke that hung over that part of Devon from cattle being burned on their pyres will never be forgotten. Today, there is the challenge of bovine tuberculosis, which costs 30,000 cattle a year in this country and causes untold misery to Devon’s farmers. I am pleased that this issue is receiving the vigorous attention of our Government.
Many other serious issues affect my constituency, including the underfunding of our schools compared with other parts of the country. Devon is ranked 148th out of 151 local education authorities in terms of central Government funding. There are many reasons why that position is too low. I will continue to press on this matter for the sake of our local children, who have a right to a fair share of education funds.
In this debate I wish to focus on schools, not least because I have a strong belief that the greatest gift that any young person can receive, after a loving family, is that of a good education. For those who choose the vocational path, it is vital that education be provided with the same energy and vigour as that afforded to the more traditional academic routes. I welcome the statement of my hon. Friend the Minister of State responsible for skills and lifelong learning that there will be an extra £50 million of capital expenditure for further education and an extra 50,000 apprenticeships. He should be congratulated, as we should remember that education and skills are important not just in and of themselves but to the life chances of our young people.
Education is the great highway of social mobility—for individuals to move on and up, in many cases escaping poverty and deprivation in the process. I say that as someone whose mother and father left school at ages 15 and 14, and whose life was transformed by the winning of a free place at a grammar school. The greatest opportunity ever provided to me, that school became the foundation on which the rest of my life was built. I would like to see others have the opportunity that I was privileged to receive.
I have long admired the ideas and the reforming passion of my right hon. Friend the Secretary of State for Education and my hon. Friend the Minister of State. They have fully understood the force for good that education and skills can represent, but they have done more than that. They have truly understood the disgraceful and inhumane waste that is represented by continued educational failure—the appalling destruction of life chances, especially among the least advantaged. It is they who have understood the extraordinary power of choice: that choice will drive up standards; that parents know better than bureaucrats; that giving power to those who otherwise just have to take what they are given is the key to raising up the less advantaged; that future generations must be sustained not just by hope but by taking control of their destinies; and most importantly of all, that there is an age-old truth that the quest to create a stronger and better society cannot be left to the planners, to the bureaucracies, to the well-meaning architects of the state, but must be gifted to those by whom the consequences of success or failure are most keenly felt.
The Government’s radical agenda for education and skills will represent a vital journey—a true quest for equality, of a kind not that seeks to push down to some lowest common denominator, but that seeks to raise people up by providing choice and opportunity for every young person, irrespective of wealth, colour, race, creed and social background.
I thank the House for its indulgence and wish the Government every success in their vital endeavour.
Anne Marie Morris (Newton Abbot) (Con)
I feel privileged to have this opportunity to make my maiden speech; I might say that I feel 21 all over again. It is a real pleasure to do so during a debate that is so fundamentally important to my constituents. My constituents in Newton Abbott have a real issue, and that is deprivation. We need regeneration, and skills have to be the route to regenerating the local economy, but before I move to that, let me pay tribute to my two predecessors, whom I share with my hon. Friend the Member for Central Devon (Mel Stride).
Mr Richard Younger-Ross was very much loved by his constituents. He was a hard-working Member, and he pushed forward a number of issues that I shall also push forward relating to the inappropriate water charges in the south-west and the A380 bypass, which has continually deprived our economy of the growth that it needs. My other predecessor was, as my hon. Friend the Member for Central Devon expressed, a colourful character. I reiterate my hon. Friend’s comments about the real good that Anthony Steen did in putting human trafficking on the agenda. I am pleased that he is carrying on with that work.
Let me give the House a little of the colour and flavour of my constituency of Newton Abbot. If I could give the Boundary Commission some advice, it would be this: next time, can we change the name? Many people have told me that as they do not live in the town of Newton Abbot they feel completely disfranchised.
My constituency is two thirds urban and a third rural. There are four towns, and until recently one of them, Kingsteignton, was the largest village in the country. My towns have interesting histories, but they have suffered not just during the most recent recession but over the past 50 years because there has not been the investment in the south-west that it deserves. Newton Abbot has a proud history in engineering. In the days of the railways, in the 1950s, it was very prosperous, but I am sad to say that only one large company—Centrax—is left. It is a proud example, but we need more.
Teignmouth is a typical fishing village. We still have a small port, so there is a real challenge in making fishing sustainable. At present, our trawlers have to land at Brixham, a neighbouring seaside town—indeed, my original family home town—but that does not help my constituents.
Dawlish is absolutely beautiful. I encourage any Member who comes to my part of the world to pay it a visit. It is a typical tourist seaside resort, with some of the most beautiful views. It is probably best known for its long stretch of railway. I am sure Members have seen adverts showing the waves coming over the train. It is extremely picturesque, but things have changed and across my constituency tourism and retail are the main generators of economic wealth. Members will know as well as I do that they do not pay very well.
As the south-west is a beautiful part of the world, we have attracted a lot of retired people, and 30% of the population are more than 60 years of age. That presents a challenge, because there is great disparity between the cost of living and average income, which is why certain issues are particularly acute—water rates, for example. Many things need to be done.
I turn to regeneration and the vital role of the skills debate. One of the most important things is to help children to aspire. At the beginning of the Parliament, I heard a new Member make a very moving speech about how important it is that kids aspire, and in whatever we bring forward I should like to see a method for making that happen. It is partly about role models, so bringing in second careerers, perhaps people from the forces, is absolutely the right thing to do. We need those role models. We need to involve local businesses in schools much earlier. Simply introducing the connection in the fifth form—as it was in my day—is too late; it needs to start earlier. If we can do that, we shall make a big difference.
We should try to improve quality and variety in education along the line—primary, secondary and tertiary. There has been a focus in tertiary education on what I can only describe as the intellectual professions, such as law and accountancy. There has not been a focus on careers as plumbers, engineers and electricians. Those are all valid careers that require no less intelligence, just intelligence of a different variety. I should like some colleges to be the technical colleges that we all knew and loved when we were younger. They should look at proper hands-on training. When I visit colleges I am distressed to find that because of health and safety and all the other rules and regulation, education is all about bits of paper, not about students getting their hands dirty. Getting one’s hands dirty is an extremely good and valuable thing. There is a skills college in my community. I want it to be properly funded so that it can become a proper technical college, but we are only halfway through the process, so the Minister on the Front Bench will be hearing from me about that issue going forward.
Then there is the issue of linking tertiary education with jobs, and for my money it is absolutely crucial that we give apprenticeships a real chance. When I talk to people with small businesses in my community, they say, “Anne Marie, one of the challenges is that we cannot afford to take on apprentices, because at the moment all of the burden falls on the employer and it is a huge burden.” I am therefore very pleased to see new initiatives from the new Government that will share the cost of apprenticeships. I welcome that 100%.
Of course, we must not forget those who are coming to their second, third and fourth career—often those who have been made redundant, through no fault of their own. When I talk to people who have just been made redundant, I see that one of the challenges is getting extra training, which is really difficult. There is a lot of training out there, but it is very hard to find because there is no route map, and there is also not as much funding available as there used to be. So I am delighted to hear from our new Government that they are to streamline that and make it far more accessible.
For me, the skills agenda is a real opportunity for my constituency. It is a way of helping it to regenerate, and that is absolutely key. If I do nothing else in my term in this Parliament, I will work to regenerate Newton Abbot: to regenerate the four towns; to regenerate the villages; to make sure that farming, which my hon. Friend the Member for Central Devon has already mentioned, has a real future; and to put the south-west back on the map, because it feels very much the poor relation and that is not right. I will be here, banging the drum to make sure that is not the case, until I finally leave this House.
Jake Berry (Rossendale and Darwen) (Con)
I am very grateful for the opportunity to make this, my maiden speech, today. I understand that maiden speeches—first speeches in Parliament—are very like your first child: easier to conceive than to deliver.
Rossendale and Darwen, the constituency I have the honour of representing, was previously held by Ms Janet Anderson for 18 years. During that period Ms Anderson was a hard-working constituency MP, and will be well remembered by many people in my area. She will especially be remembered for her pioneering support and work for local Sure Start centres, and I take the opportunity to pay tribute to her.
Rossendale and Darwen was formed in 1983, and the first Member of Parliament was David Trippier—now Sir David Trippier—who I am sure is well remembered by many people in the House. Sir David still resides in the village of Helmshore, where my wife and I have our current home. This is apt, as Helmshore is the geographical centre of the constituency, with the Robin Hood being the actual heart of the constituency. For those Members in the House who are avid readers of our two local papers, the Rossendale Free Press and the Lancashire Telegraph, I should add that that is not Robin Hood’s well, where I proposed to my wife; it is the Robin Hood public house at the centre of our village, where the beer, and the welcome, is second to none, especially on a Friday evening.
Rossendale and Darwen, being nearly 220 square miles, is formed of four separate towns—Whitworth, Darwen, Bacup and Rawtenstall. Each of these towns is separate from the others, and they are independent in both spirit and mind while being similar in many ways. Each is boarded by the lofty west Pennine moors, hemming them into deep valleys, with houses and mills alike with steep mountains rising above them; and streams rush through glens, giving the power that once drove the east Lancashire textile mills.
There are also many villages in my constituency, with small, close-knit communities, such as Belmont, Weir, Turton, Hoddlesden and Tockholes. Those villages doggedly cling limpet-like to the hillside during the winter months. Last winter, some were cut off from the outside world for several weeks. In the summer months, the villages are marked by horses paddock grazing, and I am sure that the village of Edenfield, in the electoral division of Eden, conjures into Members’ minds the appropriate visions of pastoral bliss and long summer evenings.
It is not the landscape, beautiful as it is, that binds together this area of east Lancashire, but the character of the people who live in Rossendale and Darwen. The first Member of Parliament to be killed in the second world war was from the village of Stubbins in Rossendale. Captain Richard Porritt, a member of the Lancashire Fusiliers, was killed in Belgium on 26 May 1940, and he is remembered in the Chamber with a shield to the right of your Chair, Madam Deputy Speaker. Last November, I had the honour of attending a Remembrance Sunday service in Whitworth with two current members of the Lancashire Fusiliers just back from Afghanistan, who laid a wreath and cross in memory of their seven fallen comrades. Many families in my constituency continue to have a strong connection with our armed forces. I believe that we in this country have the finest armed forces in the world and I shall do all that I can to support them and their families while I am a Member of the House.
It is apt that I am making my maiden speech during a debate about building a high-skilled economy because I believe that Rossendale and Darwen can be in the vanguard of rebalancing our economy to that of a highly skilled industrial economy. Rossendale and Darwen were at the centre of the first industrial revolution. Rossendale was the centre of the world’s slipper trade, while Darwen was the birthplace of wallpaper, and both were major centres for the textile industry. Such was Darwen’s importance to the cotton trade that it was visited by Mahatma Gandhi in 1931 so that he could witness the effect of the Indian Congress party’s boycott of Lancashire cotton mills.
This white-hot flame of innovation that led to the invention of wallpaper and the introduction of the first power looms still burns in the breast of every young person in my constituency, and we must do all that we can to foster their full potential. I applaud the Government’s commitment to investing in workplace apprenticeships to ensure that our young people, especially in Rossendale and Darwen, have the correct menu of skills to continue our strong tradition of local manufacturing. There are still many well-known manufacturing companies in my constituency, such as J&J Ormerod kitchens in Stacksteads, James Killelea steel in Crawshawbooth, Crown Paints in Darwen and WEC engineering in Darwen, which was visited by my right hon. Friend the Prime Minister immediately before the election. All those well-known local manufacturing businesses provide high-skilled jobs for our young people.
The rebalancing of our economy is a key aim of the Government, as is set out in the coalition agreement. With a fairer and more balanced economy in which we are not so dependent on the financial services industry, and in which economic opportunities are more evenly shared among our regions and industries, I optimistically predict that Rossendale and Darwen will prosper and become a regional manufacturing superpower.
Amber Rudd (Hastings and Rye) (Con)
I am grateful for the opportunity to deliver my maiden speech. I congratulate all new Members who have spoken so elegantly and eloquently, particularly my hon. Friend the Member for Rossendale and Darwen (Jake Berry), whose maiden speech was well conceived and comfortably delivered.
I represent the constituency of Hastings and Rye. Of course, it is only us who call our areas constituencies. To my constituents, the constituency is home, where they live and where they bring up their families, and I will never forget that. Some six weeks since the general election, I still get a little lost going from one room to the next, and between staircases and lifts, but I remain impressed, humbled and not a little relieved to be in these historic corridors and as part of this historic coalition.
Part of my responsibility is to live up to the example of the previous Member of Parliament for Hastings and Rye, Michael Foster. He was the epitome of a good constituency MP. He was immensely popular, not just because of the individual acts that he did for local residents, but because of his high visibility locally and his successful lobbying of the then Government for additional funds for the town. Unfortunately for him, his popularity grew in inverse proportion to that of his Government, but I recognise that, through his service, he set a very high bar—one that I shall try to reach and, hopefully, at some stage exceed.
The fruits of Michael Foster’s success are evident in Hastings. We have a new train station, further education college, and university centre, and two new state-of-the-art office developments. However, physical regeneration has not yet translated into economic regeneration. Our offices are still largely empty, the train services are still poor, and on the index of multiple deprivation, Hastings remains 29th from the bottom. We have some of the lowest wages and highest unemployment in the whole country, let alone the south-east. Cynics might be forgiven for thinking that Labour’s regeneration has been a triumph of style over substance so far. The make-up is in place, but I am afraid that the wrinkles are still very much there.
But deprivation is only one part of Hastings, and Hastings is only one part of an area of contrasts and variations. My constituency feels very much like a microcosm of the country, with urban and rural areas, with farmland adjacent to idyllic estates, and with idyllic villages next to deprived wards. We are the custodians of England’s most famous date—perhaps more famous than 6 May 2010.
Let me introduce colleagues to the wonderful aspects of my constituency. Hastings, Rye and the village of Winchelsea were all parts of the Cinque ports, which were put together in the 11th century to keep out seafaring invaders, and for the mutual benefit of trade and fishing. Each place has its own unique character. I urge Members to spend their summer holidays with us. They can enjoy local produce, the source of modern English history, top-quality entertainment, fresh air and exercise—and for the more sedentary among us, there are fish and chips and slot machines. They can even walk in genuine dinosaur footprints, which may appeal to some Labour Members.
Tourism is an essential ingredient of what we have to offer. Hotels and boarding houses boast that they have been popular with visitors since 1066—visitors, of course, have not always been so popular with them. We have fantastic beaches, wonderful countryside and arguably the world’s most remarkable heritage. We have flourishing language schools, visited by students from all over the world, and a community that welcomes them with open arms, not to mention open tills, because we need the business.
Like many towns, we suffer from the coastal problem of being at the end of the line. Looking at previous maiden speeches over the past 40 to 50 years, I see that there has been a recurring theme: transport. The A21 to Hastings needs renewing and improvement. Our survival and prosperity depend on access. There is no point having wonderful facilities if people cannot access them. It unquestionably puts off employers and tourists, both of whom we need, that it is so difficult to get to our part of the world. I am talking of a constituency where 43% of the work force are in the public sector. We are like an island. We know which way the tide is going; we need to attract the private sector to try to take up some of the unemployment. I fear that much of the money that has already been spent in my constituency will fail to improve the economy if we do not do something about that. For too long, we have been the underprivileged cousin of the south-east. Many of my constituents have suffered terribly from an economy that has simply left them behind.
I have two important considerations for my constituency of Hastings and Rye. The first is transport. I recognise the particular financial situation in which we find ourselves—there must be cuts; we have inherited a difficult legacy. However, I urge Government Front Benchers not to make them to vital infrastructure projects, on which everything else depends. In my constituency, they are a link road to open up the area to more jobs and more employers, improvements to the A21, and better rail transport. We must be accessible to prosper. Conservatives understand above all the importance of enterprise and encouraging private sector growth so that families and communities can grow on their own.
We have discussed the high-skilled economy, and I agree that we all need that for our country to advance. However, I would like to draw hon. Members’ attention to a very old trade. In Hastings, we have the largest beach-launched fishing fleet in Europe. In Rye, we have an important port and fishing fleet. They have been treated shamefully in the past 15 years. In the 1990s, there were 44 fishing vessels leaving Hastings; now there are 20, and the fishermen eke out a precarious living. Those men earn their living in a traditional, honest and environmentally friendly way, battling with the sea and the dangers of the deep. However, the common fisheries policy, as enforced by the Department for Environment, Food and Rural Affairs, has made their lives impossible. In 2005, there were prosecutions of those fishermen. The role of Government must be to help people, not put them out of business. Their way of life needs bailing out. Our Fisheries Minister understands the issue and the urgency and has visited Hastings twice, but we cannot wait for a full renegotiation of the common fisheries policy. We need change now, with the cod season approaching and difficulties ahead of us. We need a Government who protect our fisheries and our fishermen. I urge particular consideration of coastal towns.
The Government recognise the importance of promoting private sector growth. I hope that we can demonstrate that in Hastings and Rye by supporting better transport links and securing a fairer deal for fishermen. All we ask is a fair wind and an even keel.
James Wharton (Stockton South) (Con)
Thank you, Madam Deputy Speaker, for the opportunity to address the House for the first time. It is a nerve-racking moment, made all the more so by following the excellent contributions from hon. Members throughout the debate, with constituencies ranging from Central Devon to Pendle, and Hastings and Rye to Rossendale and Darwen. I am therefore grateful for the courtesies that the House extends to new Members during their maiden speech. I promise not to detain the House too long.
Sitting in the House as Conservative Member for a constituency in the north-east of England makes me something of a rare specimen, thought almost extinct just over a decade ago, but I assure hon. Members that we are showing encouraging signs of life and energy once again.
I follow in the footsteps of Harold Macmillan and Tim Devlin, as well, of course, as my most recent predecessor, Dari Taylor. Ms Taylor represented Stockton, South for 13 years, during which time she worked hard for her party and gave energetic support to the charity Cardiac Risk in the Young.
All Stockton MPs follow in the footsteps of Joseph Dodds, the first Member of Parliament for the seat. He won it when it was first enfranchised in 1868. He built up one of the largest majorities in the country in the next 20 years, having won only narrowly when he was first elected. Unfortunately, towards the end of his career, there were what might be termed financial irregularities, and he had to resign his seat after being made bankrupt. However, that was reported rather more generously in the press of the time than might be the case today. I hope it will not be taken amiss, or as not in the spirit of the new politics, in which those of us on this side of the House are so energetically engaged, if I say that Joseph Dodds was, of course, a Liberal Member for Stockton-on-Tees.
It will be my aim over the coming years not only to represent the good people of Stockton South and its surrounding towns and villages, for whose support and confidence I am grateful, but to wave the flag for Teesside. My predecessor Tim Devlin said in this House 23 years ago:
“It persists in the minds of southern folk who think that we northerners all live in back-to-back houses and keep whippets.”—[Official Report, 4 November 1987; Vol. 121, c. 972.]
Although some progress has been made in addressing perceptions of the north, there is much still to do. I hope to play my part in ensuring that such perceptions are challenged and corrected. In my own constituency, we have vibrant towns such as Yarm and Eaglescliffe, which showcase the very best that this country has to offer. There are also things that must be done: Ingleby Barwick needs more school places, Thornaby’s regeneration is not yet complete, and Stockton itself has a high street which, although not in my constituency, must be the focus of local efforts to secure real and lasting improvement.
The economy of the north-east of England is, and has for many years been, dependent on the public sector. I hope that over the coming years our private sector might take on a more significant role, and I trust that the Government will make promoting and sustaining that private sector one of its key aims in these difficult times. By building on the skills that we in the north-east region have, with our manufacturing and engineering heritage, I believe that we can build a stronger economy, regionally and nationally, which will benefit many generations to come.
Teesside as a whole needs to re-establish its true identity. Half of my constituency has been in Yorkshire, half in Durham, all was once in Cleveland, and all was also once in Teesside, and now, confusingly, we are told that we are in the Tees valley, although I have yet to find the Tees valley on any standard highways map. In Stockton South we have Durham university and Teesside retail park, but we are served by Cleveland police and Tees Valley Unlimited, and we celebrate Yorkshire day. Should any hon. Members find that perplexing, I invite them to visit that wonderful part of the world, especially over the summer recess—I can assure Members on both sides of the House that even in the north-east, we do indeed have a summer. Of course, they could fly direct into Durham Tees Valley airport—or at least they could have done when we had a direct service, which is another issue I hope to address and be involved with over the coming years. Those of us who were born and raised in Stockton can occasionally be heard to joke that we do not have a county. That joke has worn thin over the years and I hope the new Government recognise the anomaly and work with myself and others to address the current confusion.
The people of Teesside are hard-working and industrious, and there are all the signs of real success and wealth, but all too often, as is the case in so many other places, they sit next to pockets of real deprivation and need. We must raise the sights of those who have looked down at the ground for too long, and realise the true potential hidden beneath the surface of the terrible jobless figures and levels of personal debt which, for far too many families, have become the norm. It is by training and education that that can be achieved. My part of the north-east has suffered more than most during the recent recession, with the mothballing of our local Corus plant at Redcar, and the recent announcement that Garlands, a previously highly successful local company, has gone into administration, so we must ensure that our voices are heard loud and clear from both sides of the House.
Our local entrepreneurs, such as Sir John Hall, Duncan Bannatyne and Steve Gibson, are key drivers for our economy, not just in the region but far beyond. We must support individuals like them, from the smallest new businesses to the largest and most successful of enterprises. I want the north-east to be known as a place where business can be done. We have the skills and the spirit; we just need the chance to prove what we can achieve.
Throughout history, the north has been a powerhouse driving this country forward. Since the days of the industrial revolution, Teesside has played its part—Sydney Harbour bridge was made from our steel, and our coal powered the engines of empire. My constituents have sent me here to tell that to the House, to speak out for a great place and to support the Government in their work to tackle many of the problems that we now face.
The people of the north-east will look to the Government and to their representatives in the House to ensure that the transition to a new economic model is successful, and that jobs and livelihoods are protected. We want to grow, succeed and impress. I am confident that the new Government will listen to what the people of the north-east have to say, and I look forward to working to secure a bright future for its people.
Thank you, Madam Deputy Speaker, for your indulgence in calling me this afternoon, and in particular I want to thank the people of Stockton South for putting their confidence in me and sending me here to speak to you today and on however many other occasions I have the pleasure to address the House. It is a real pleasure to serve the constituency in which I live and in which I was brought up. I look forward to serving, and to working with Members on both sides of the House to ensure that the voice of the north-east is always heard here in Westminster and elsewhere.
Anna Soubry (Broxtowe) (Con)
It is kind of you, Madam Deputy Speaker, and generous of my hon. Friend the Member for Stockton South (James Wharton), to allow me to speak. I know that the clock is against me, but I am no stranger to that. For many year, I worked in television so I am used to the ticking arm and the fierce direction of a floor manager and director who told me, in no uncertain terms, to shut up. I also worked as a criminal barrister for 16 years, so I am also used to someone firm in the chair telling me in even firmer terms to shut up, and on those occasions I never argued.
This is a great opportunity to pay tribute to my predecessors and to give a short explanation of the constituency that I have the honour and privilege to represent. I know that my hon. Friend the Minister knows the answer to the question that many ask about the exact location of Broxtowe. It does not exist on any map, but I urge all hon. Members to look at Nottingham on the internet. If they zoom in to the western side, they will see a stretch of land between the city and the border with Derbyshire. I urge those who travel up the M1 to come off at junction 25 or 26 and experience Broxtowe. It is a fine place, as my hon. Friend knows because his mother is one of my constituents. She lives in the village of Bramcote.
Many people would say, on visiting Broxtowe, that it is part of the urban sprawl, but last bank holiday I spent two days walking—I had sore feet afterwards—across the constituency to enjoy the green belt. In that time, I saw all the places that I am so very proud to represent, including Beeston in the south and more green areas around Greasley, Giltbrook and Kimberley in the north.
I wish to pay tribute to another place in my constituency and thereby pay tribute to my predecessors. It is a hamlet called Cossall, which lies in beautiful rolling pastures. It has a fine tradition of mining, and D. H. Lawrence’s fiancée had the joy of living there, but an unfortunate legacy from the mining industry is the threat of open-cast mining. The first Member of Parliament to represent Broxtowe—it was created in 1983—was Sir Jim Lester, who was well known and much loved in this House. He was followed by my immediate predecessor, Nick Palmer. Both men have many attributes in common, and I hope to share those in the years to come. They were moderate and reasonable in their politics, they worked hard for the people they represented, and both joined in opposing any plans for open-cast mining in that beautiful green land. I seek to emulate both in my time in this House.
During my time here, it will be an honour and privilege to represent the people of Broxtowe, as others have said about their constituencies. There are many new Members and we bring diverse experiences to the House, but we all hope to play a real part here. We will challenge and hold the Government to account, and we will ask questions whenever we can, but most of all we will represent our constituents. Many of us were selected many years ago and getting here has been a long journey, so we are well aware of the responsibilities that we all bear. We will take great joy and pleasure in representing our constituents and do our very best for them by bringing forward the causes that they all hold dear.
Mr David Lammy (Tottenham) (Lab)
Madam Deputy Speaker, may I welcome you to the Chair and wish you very well in your new role in the House? The House has been at its very best this afternoon, and I have enjoyed all the contributions, particularly the maiden speeches. The subject of education and skills always brings out the very best in Members. Indeed, for many of us, from whatever party represented in the House, it is the reason why we came into public life, and we have seen that today.
I congratulate the hon. Member for Milton Keynes South (Iain Stewart) on his contribution. He spoke warmly of his predecessor, Dr Starkey, who is remembered fondly on the Labour Benches, and of Milton Keynes’ great heritage in higher education. I was pleased to visit the new university centre in Milton Keynes, and I hope that he continues to support it in its work to extend access and widen participation in that area. Of course, Labour Members are particularly fond of, and are keen to remember, the great Open university and the heritage of Jenny Lee and the Wilson era Labour Government.
We heard a fantastic and wonderful speech from my hon. Friend the Member for Liverpool, Walton (Steve Rotheram), who I know was a very effective mayor of Liverpool during its year as capital of culture. He included many of the football references that we hear in the House. He obviously has big shoes to fill—many of us remember Peter Kilfoyle fondly—and I particularly enjoyed his reference to growing up on an estate. Those of us who grew up in very humble circumstances wish him well in his endeavours to remind the House that there are many people a long, long way from this Chamber.
We also heard an eloquent and articulate speech from the hon. Member for Romsey and Southampton North (Caroline Nokes). I hope that she will not be overwhelmed by liberalism, as she referenced in her speech. I am sorry that I was not in the Chamber to hear the hon. Member for Colne Valley (Jason McCartney), who made many football references, so I will look at them in Hansard tomorrow. He spoke warmly of his predecessor, who was well respected on the Labour Benches.
I know the hon. Member for Battersea (Jane Ellison) because she stood against me in Tottenham in 2000. She will remember that back then I looked a little more like Denzel Washington, but 10 years later I look a lot more like Forest Whitaker. She has championed the Conservative cause in London. I wish her well in her seat, and it is good that she mentioned Battersea Dogs Home—an institution of which we in London are very fond.
The hon. Member for Pendle (Andrew Stephenson) made me want to rush up to north-east Lancashire. I do not claim it is an area of the country I know well enough, but I thought he gave a very eloquent speech in which he reminded us of that city’s manufacturing heritage.
The hon. Member for Cleethorpes (Martin Vickers) also gave an eloquent speech. He was very kind about his predecessor and reminded us that we must continue to rediscover the importance of our industrial heritage—the Humber clearly played an important role in our history.
The hon. Member for Central Devon (Mel Stride) could have got a job with a tourism agency in speaking about his constituency. His effective speech reminded us not just of the industrial nature of so many of the areas that we represent, but of the importance of agriculture and the skills that we need to support agriculture in our economy.
Let me pay tribute to the hon. Member for Newton Abbot (Anne Marie Morris), who made a warm and passionate speech. She placed a great emphasis on role models—an issue that I have also championed in the House—and again, the beauty of the area that she represents came across.
The hon. Member for Rossendale and Darwen (Jake Berry) also paid an eloquent tribute, not just to his constituency but, importantly, to our armed forces. Historically, they have always played an important role in this country, by providing so many men and women with skills who have not just served our armed forces, but gone on to serve the wider community once they left the armed services.
Like the hon. Member for Central Devon, the hon. Member for Hastings and Rye (Amber Rudd) reminded us of the importance of seaside areas and the work that we must continue doing, particularly in the south-east, where there remain acute pockets of deprivation.
The hon. Member for Stockton South (James Wharton) is a tribute to the north. He is keen to keep Stockton on the map, as his predecessor was, despite the boundary issues affecting his constituency.
I was not surprised that the hon. Member for Broxtowe (Anna Soubry), being a barrister, managed to cram a lot into her speech in the time available. I look forward to her contributions in the Chamber over the years ahead.
Let me turn to the returning parliamentarians. I am grateful to my hon. Friend the Member for Birmingham, Selly Oak (Steve McCabe) for reminding us of the role of group training associations in extending apprenticeships and helping small businesses in particular to take part in our wider apprenticeship schemes.
My hon. Friend the Member for City of Durham (Roberta Blackman-Woods) has tremendous expertise in higher education issues, but she also reminded us of the importance of the Leitch targets. I hope that when the Minister winds up we might hear something about whether the Government remain committed to those targets.
My hon. Friend the Member for Derby North (Chris Williamson) was right to remind the House that Derby remains an exemplar city, owing to its unique combination of both skills and manufacturing. There is much that we can learn from the success of that part of the country over the most recent period. We all want to replicate that success in different parts of the country.
I congratulate my hon. Friend the Member for West Bromwich West (Mr Bailey) on his election as Chair of the Select Committee on Business, Innovation and Skills, and on his thoughtful speech. We all look forward to hearing more from him in these debates over the coming years.
I congratulate the hon. Member for Burnley (Gordon Birtwistle) on his advancement of the cause of UCLan university in his constituency and on reminding us of the industrial heritage of his area and the importance of companies such as Rolls-Royce.
We also heard from my hon. Friend the Member for Bridgend (Mrs Moon), in an intervention. Importantly, she reminded us not just of the role of universities—she spoke about Cardiff—but of the many spin-out companies that emerge from universities, taking skills back into the community, as people graduate and create companies. They are illustrations of the huge success of “Science made simple”.
Let me come to the contribution of the Minister of State, the hon. Member for South Holland and The Deepings (Mr Hayes). I have had exchanges with him across the Chamber for about four years—first in my role as the Minister for skills and then as the Minister for higher education. I look forward to the debates that we will have over the coming months. He has always described himself as a high Tory. As a consequence, he has an elevated—some might say levitated—status in the Chamber. I know his constituency well; I remember it fondly from my days as a Peterborough cathedral chorister. I suspect that he can be found on a Sunday engaging in amateur dramatics in the village halls around Spalding, playing Hercule Poirot or even Miss Marple.
Mr Lammy
Indeed.
I was disappointed not to see a reference to higher education in the motion and not to hear much from the hon. Gentleman about its importance. It is my view—I hope that it is his—that a world-class university system is central to a high-skilled economy. I grew up in Tottenham during a very difficult time in our history—and as an ethnic minority in troubled and difficult times—and I am very proud of all that we have done to widen access and extend opportunities for poorer and non-traditional families and for ethnic minorities across the country. It was a huge achievement for the Labour Government to widen participation to 44% and to enable more young people and more black and ethnic minorities to go to university than ever before.
When we look at constituencies in inner-city Liverpool, Birmingham and Manchester and at the pockets of deprivation in the cities, towns and villages that we have heard about today, and we see young people—whose parents would never have dreamed of going to university—going into higher education, we realise the major contribution that the Labour Government made to our high-skilled economy. It is important that that should continue.
It is a great shame that the Minister for Universities and Science, the right hon. Member for Havant (Mr Willetts), recently referred to students and young people as a “burden on the taxpayer”. Students are never a burden on the taxpayer. Underlying his statement is a certain view of the state and a suspicion of the contribution that the state makes to advancing the cause of a high-skilled economy. We will take every opportunity to challenge such assumptions over the coming months.
The Minister of State, the hon. Member for South Holland and The Deepings, has announced the creation of 50,000 apprenticeships, but he is not in opposition now, and he must remember that he does not have those 50,000 apprenticeships until he has delivered them. The people who will actually deliver them, however, are in business and industry. Achieving that will take a lot of hard effort over the coming months, because I do not think that he is suggesting that the money that he has set aside will pay the salaries of those young apprentices. He is still expecting business to do that. So, at the moment, he has delivered only one apprentice: the public apprentice, the Chief Secretary to the Treasury. I wish the Minister of State well, but we will be looking hard at the detail over the coming months, and he will expect me to penetrate fiercely some of the hyperbole in his comments.
The Parliamentary Under-Secretary of State for Business, Innovation and Skills (Mr Edward Davey)
It is a great pleasure to welcome you, Madam Deputy Speaker, to the Chair. You and I debated with each other over many years while you were a Minister, and I particularly remember when you were Paymaster General. I know that, given your knowledge of the tax system, you will be looking forward to chairing a debate on the Finance Bill to take you down memory lane.
This has been a high-quality debate which has been conducted in a cross-party way, as different right hon. and hon. Members have made positive contributions. As my hon. Friend the Minister said in his opening remarks, he is listening to the contributions of all Members. We have also heard about football and have almost had an exercise in VisitBritain as we have gone around the country.
I will not be able to talk about every maiden speech, but their overall quality was superb. When I made my maiden speech, I was rather more nervous than those delivering the self-confident and assured maiden speeches that we have heard today. If I may, I shall take a tour d’horizon of those speeches. We had cock and bull from the hon. Member for Milton Keynes South (Iain Stewart); we had a Conservative club haunted by Roundheads from the hon. Member for Romsey and Southampton North (Caroline Nokes); and we had a Yorkshire vineyard from the hon. Member for Colne Valley (Jason McCartney), as he talked about the “Last of the Summer Wine”.
Two hon. Members showed great perception in how to represent their constituencies. I am thinking of the hon. Members for Cleethorpes (Martin Vickers) and for Rossendale and Darwen (Jake Berry), as they listed their local newspapers in their speeches. I have always found that when I talk about the Kingston Informer, the Kingston Guardian, the Surrey Comet and Radio Jackie, it is always a very good way of representing one’s constituents.
As I mentioned earlier, we also heard about football, as Members talked about the various football clubs in their constituencies. I have to make a confession—I am a Kingstonian fan because they play in Kingston, and I am also an AFC Wimbledon fan, as the club shares the Kingsmeadow ground. I have to say to the hon. Member for Milton Keynes South that although he has the MK Dons, we have the real Wimbledon playing in my constituency. I also have to confess that, although I was born in Nottingham and my first team is Notts County, I am also a Liverpool fan. Let me explain why. I was the only member of the class who was a Notts County fan during the Clough years, so I had to support one team that was giving Nottingham Forest a hard time.
I therefore particularly enjoyed the speech of the hon. Member for Broxtowe (Anna Soubry), as I know her constituency fairly well. I have never lived there, but I used to go to Nottingham university boating lake. I will not go any further into that, but we had some nice times there. As a student, I worked in Boots, which has a factory in the hon. Lady’s constituency, and during my student vacation I helped to make pork pies for Northern Foods. I am not sure whether politicians should confess to making pork pies, but when students were making them, complaints from consumers went up—I hope that it was nothing to do with my skills.
As Members from both sides of the House addressed the substance of today’s debate, we heard about how they, and organisations in their constituencies, are playing a critical role in improving our country’s skills. The hon. Member for Milton Keynes South was quite right to talk about the Open university. As we debate higher education, the model of the Open university is one that people will want to replicate. I speak as a former student, now a fellow, of Birkbeck college, where part-time education is also key. We really need to engage in a more flexible approach to higher education, and the Open university has a lot to contribute in that respect.
We heard about the university of Southampton from the hon. Member for Romsey and Southampton North, and we also heard how a number of Members had been apprentices. We heard from the hon. Member for Liverpool, Walton (Steve Rotheram) about his time as an apprentice bricklayer. We heard from my hon. Friend the Member for Burnley (Gordon Birtwistle) about his apprenticeship as a textile machine manufacturer.
That is why this Government are so proud, in their very earliest days, to have put extra money into the apprenticeship scheme, and to have set a target of 50,000 new apprenticeships. The right hon. Member for Tottenham (Mr Lammy) seemed to jest—how could we be so bold as to want to create 50,000 new apprenticeships?—but we are very proud to have set that target. The right hon. Gentleman appears to consider it unachievable, but I can tell him that I have discussed it with my hon. Friend the Minister and with officials, and we are certain that we will meet it and do better as time goes on. I hope that in due course, when we have achieved our aim, he will pay this coalition Government the credit that they deserve.
Mr Davey
What I have noticed about the targets set by the previous Government—which the right hon. Gentleman mentioned in his speech—is how often they were not met. The Government set target after target which they then failed to meet. The right hon. Gentleman spoke of the targets that they set for apprenticeships, but they set those targets and never met them. We will meet our target, and I believe that we will meet it within the next 12 months. I hope that the right hon. Gentleman will soon eat his words.
We heard an awful lot today about the importance of manufacturing industry. I believe that the Government’s skills programme will ensure that it receives the support that it deserves, at the basic skills and education level. Labour Members may complain about the state of manufacturing industry, but they have a poor record in that regard themselves. The hon. Member for West Bromwich West (Mr Bailey), the new Chair of the Business, Innovation and Skills Committee—I welcome him to his post—made a thoughtful speech on the subject, but I think he should bear in mind that whereas in 1997 manufacturing represented 20% of the United Kingdom economy, by the time the Labour Government left office the proportion had fallen to 12%.
Mr Davey
Of course that is true of many modern economies, but I think it ill behoves the Labour party to criticise this Government in their early days, given that its own approach to manufacturing industry was not to turn the tide and go against the trend.
Although we have a huge amount in common, when Labour Members talk about the skills agenda they sometimes forget some of the record of which they should be less proud. I am thinking particularly of the quangocracy that grew up around the skills agenda. There is currently a patchwork quilt of quangos involved in that agenda. Members may be interested to learn how the position has changed. In government, the Labour party did not just create the existing quangos, but created quangos, abolished them and created new ones, all within 13 years. The fact that that instability and reinvention happened time after time shows that the Labour Government never really had a true vision. They constantly spent large amounts on new quangos while failing to get some of that money to the grass roots—to our communities. A lot of money was wasted then.
When the last Government set up the Learning and Skills Council, I was sent strategy after strategy by that august body. At first I thought that I had a real duty to read every single page, but when I visited the LSC and talked to its representatives, I realised that most of those strategies would never come to anything. I am afraid that that happened time and again. Huge amounts were spent on quangos, reports and consultancy, but less money went to the companies and learners who needed it. We believe that the need to rationalise the quangocracy in learning and skills is a key issue, and we will deal with it. We will do so while also having to look at the spending issues in this area, and there will be huge challenges. I do not think there is anyone in this House or involved in FE, HE or the education system in general who does not realise that we face difficult choices in this area, but we are absolutely clear that we will do our best with the money that we have got into apprenticeships and into the capital programme for FE to ensure that the priorities get the funding they deserve.
Mr Pat McFadden (Wolverhampton South East) (Lab)
As the hon. Gentleman has mentioned apprenticeships again, can he tell the House whether, in the 12 months he is talking about, if we take together what he and his colleagues are proposing on Train to Gain and apprenticeships, more learners will be funded by the Government or fewer?
Mr Davey
That is interesting. We have to compare that with what the previous Government were planning. When we looked at the funding issues facing us, and the very difficult choices, we saw that the previous Government were planning £340 million of cuts in adult further education and skills this year. That is actually happening this year, and I hope the colleges and students—and the employers—who are having to deal with the financial situation imposed by the cuts realise that the people who are to blame for that are sitting on the Opposition Benches.
Mr Davey
Before I let the right hon. Gentleman in, let me say that I hope that when he gets to his feet he admits to the House that it is under the previous Government’s plans that we are seeing a 3% reduction in funding rates for college-based provision, a 10% reduction for apprenticeships for those aged 25-year-old and over and a 6% reduction in other work-based learning. This is what we are having to deal with, and it is creating huge problems, as he ought to know.
Mr Lammy
It is the hon. Gentleman who is in government so I think he ought to answer the question put by my right hon. Friend the Member for Wolverhampton South East (Mr McFadden): will there be more or fewer learners as a result of the announcements made today? The House has a right to know.
Mr Davey
Well, one of the things the House needs to understand is that we have a different approach to FE and HE. We do not believe we can sit here in Whitehall and have a centralised system that we micromanage, and that we can then suddenly guarantee that there will be x new trainers, x new learners and x new places, as the right hon. Member for Tottenham and his friends used to do. That is why they failed so often: they took a centralised, top-down approach.
We will ensure that our approach is employer-led and learner-led. That is why we are working with businesses to make sure our schemes and proposals get the support that they will need from those areas. That is a very different approach. We know that, as we meet the challenges ahead of us, the private sector will have to be involved and be working with the Government. Far too often, the private sector was too much of an afterthought in how the right hon. Gentleman and his colleagues planned their skills agenda.
Change is inevitable and, as Dr Johnson said:
“Change is not made without inconvenience, even from worse to better.”
So there will be difficult choices. We will not shy away from them, but when we have to make those difficult decisions, it will be the employers and learners who are uppermost in our mind, not the bureaucrats and the quangos and the consultants, where all the money was wasted under the last Government.
We have had a constructive debate. I say on behalf of my hon. Friends and fellow Ministers in the Department that we are keen to listen, even to ideas from former Ministers who may at last realise that many mistakes were made and want to begin to confess. I hope that through working across parties and with the Select Committee and new Members, we can revitalise and invest in the skills our economy so desperately needs—
Transport Infrastructure (Nottingham)
(13 years, 10 months ago)
Commons ChamberRead Full debate Read Hansard Text Read Debate Ministerial Extracts
Lilian Greenwood (Nottingham South) (Lab)
Madam Deputy Speaker, I am very grateful for this opportunity to raise issues that concern not only my constituents but the wider Greater Nottingham conurbation and our region. May I say what a pleasure it is to see you in the Chair today? I also thank my hon. Friends the Members for Nottingham East (Chris Leslie) and for Gedling (Vernon Coaker) for coming along to lend me their support.
Nottingham is very fortunate to have one of the best integrated transport systems in the country, but that did not happen by chance. It happened because there was political will, because the city council worked closely with partners in the county and with local businesses, seeking to build consensus wherever possible, and because we are fortunate to have great people working in the city to deliver our collective vision.
Indeed, the Department for Transport has designated Nottingham as a centre of excellence for local transport delivery. More recently, the council received a comprehensive area assessment green flag for public transport improvement and was described as “getting better and better”. However, it is not those warm words that I want the Minister to attend to today, but the real achievements that make Nottingham’s case for further investment compelling.
Over the past five years, Nottingham has contained traffic growth and congestion levels. There has been increased public transport use, fatal and serious accidents have been reduced and we have encouraged many more people to walk or cycle rather than to jump in their cars. I am proud of our record, but we know that there is still much more to do if we are to have a transport system that is fit for purpose in the years ahead—one that supports economic growth rather than hampers it and encourages greener, eco-friendly choices.
When it comes to investment in infrastructure, short-termism just will not do. We have to think and plan for the long term, and that is why Nottingham has been developing three key capital projects to make the city an even better place to live and work, to attract inward investment, to create jobs and to get the local economy moving. These projects will regenerate neighbourhoods, link socially disadvantaged communities with training and job opportunities, improve the environment and cut carbon emissions. I know that they are not just objectives that the Minister will welcome but the stated priorities of the coalition Government, so I am very hopeful that he will give a positive response.
Let me say a bit more about the three projects on which I am anxious that he should focus. The A453 links Nottingham to the M1, the A50 and East Midlands airport. It is the main trunk road from Nottingham to Birmingham and is a vital link in our transport network. According to the most recent data, the A453 is the most congested road in the country. Delays are particularly bad at peak times and the 9-mile stretch between Nottingham and Kegworth is rated as the worst section of the national strategic road network, with the average vehicle delay doubling in the last five years. Delays can be expected of almost 15 minutes per 10 miles travelled outbound and more than 10 minutes per 10 miles travelled inbound. In 2007, the East Midlands Development Agency commissioned a study that found that the cost of congestion to Nottingham businesses came to £160 million a year, so it is no surprise that three years ago partners in the region agreed that it was the top priority for regional funding allocation. That was confirmed again in 2009.
There is also a human cost to the congestion. Driving through Clifton, one sees far too many flowers at the roadside that are a reminder of the A453’s terrible safety record: accidents are 33% higher than the national average for rural roads and 23% higher than the national average for urban roads. Between 2003 and 2007, there were 167 personal injury accidents of which two were fatal and 31 serious. Residents and business leaders, city councillors, district councillors and county councillors, and Members on both sides of the House all agree that the A453 desperately needs improvement.
Nottingham has been waiting almost 30 years for something to be done. The latest scheme will provide a “civilised road”—one that provides extra capacity, but is sensitive to the needs of Clifton residents who live alongside it. Planned improvements have been delayed twice before and we need it more than ever—so please, Minister, do not disappoint us again.
I read in the Nottingham Post that the Lord Chancellor and Secretary of State for Justice, the right hon. and learned Member for Rushcliffe (Mr Clarke) has already, as he put it, “had a go” at the Secretary of State for Transport regarding this matter. I hope that the Minister will work with his colleagues in the transport team to secure the scheme’s future and, if necessary, to make representations to the Treasury on behalf not just of the 270,000 people who live in the city or the 750,000-plus people in Nottingham’s travel-to-work area, but of the people who will be filling the 20,000 new science and technology jobs that we hope will be created in the city by 2020.
The second element of Nottingham’s plan for a modern, integrated transport network that I want to raise with the Minister is Nottingham express transit phase 2—turning our tramline into a tram network. Tramline one opened in 2004, and its success has exceeded expectations, attracting 10 million passengers a year. Yes, it required considerable investment, and, yes, the construction work was disruptive, but I urge the Minister to come for a ride across Nottingham on the tram to see at first hand what a difference it has made. I urge him to come and see the park-and-ride sites, including those at Phoenix park and Forest recreation ground, which are full to bursting every day. Some 3 million car journeys have been removed from the city’s roads and there has been a 30% increase in public transport use in the north-west corridor of the city. I like our buses, and they are a vital part of the mix, but on their own they cannot achieve that level of modal shift—getting people out of their cars and on to public transport. For the A453 scheme really to work, even with a widened A453, we need a significant proportion of the people who are coming towards the city to transfer to public transport at a park-and-ride site on the edge of Clifton.
I urge the Minister also to come and see the regeneration, inward investment and sustainable development that have been achieved along the line one route. Perhaps he will even share my enjoyment regarding the inspiration it has provided to small local businesses. I admit that every time I pass the snack bar in Hyson Green called Tramwiches, it makes me smile.
Chris Leslie (Nottingham East) (Lab/Co-op)
My hon. Friend mentions Hyson Green in my constituency. Does she agree that as phase 2 of the tram project is a private finance initiative, funded in part not so much by grant but by revenues generated from some quite tough decisions having been taken about workplace parking levies and so forth, it is potentially less burdensome on public borrowing levels because of the re-phasing potential? As a consequence, it might be a good candidate when ranked against other schemes that the Minister is considering.
Lilian Greenwood
I thank my hon. Friend for that helpful intervention.
NET phase 2 received approval because it will deliver for the city and the conurbation. It will take a further 3 million car journeys off our roads and will provide at least 50% of the additional capacity needed to avoid the transport gap that threatens the economic vitality of the conurbation. There will be 2,500 extra park-and-ride spaces, better integration with the railway station and hugely improved access to and from the south and west of the conurbation. It will link people, some of whom live in wards in which 60% of the population do not have access to a car, with the Queen’s medical centre, which is the city’s main hospital, as well as with both our universities, with local college campuses and with 2,000 workplaces, including 20 of the city’s 30 largest employers. It will also promote equality of opportunity, as line one has done, by improving transport access for the elderly, the disabled and those on low incomes.
Anna Soubry (Broxtowe) (Con)
Will the hon. Lady please explain which wards in the city council will benefit from the tram but are those in which she says 60% of people do not have access to public transport?
Lilian Greenwood
The wards are those such as Clifton South in the city and places such as the Meadows, which I wanted to talk about. The Meadows and Clifton are two areas of my constituency that suffer from significant social disadvantage, including high unemployment, low skills and low educational attainment. Clifton also has a disproportionate number of pensioner households and a large retirement village. The tram will transform those communities, regenerating their neighbourhood centres and offering full accessibility for people with mobility difficulties, including wheelchair and motorised scooter users, and it will provide a vital link to workplaces and training providers. But most importantly, it will bring jobs. The Centre for Economic and Business Research projected that between 4,000 and 10,000 new jobs would be created by NET phase 2. All this, and a hugely positive impact on the environment—cleaner air and a healthy cut in carbon emissions—make this scheme well worth investing in and excellent value for money.
I am delighted to know that the Minister is a fan of light rail, and I know that he is fully briefed on Nottingham’s tram. I certainly welcomed his comments earlier in the week at the parliamentary tea for light rail when he said that local funding was a matter for local people. He knows that the local funding for Nottingham is secure. The mechanism is in place. So I hope that he will give his backing and the backing of his Department for this exciting expansion of light rail in the UK.
Last but not least, I want to draw the Minister’s attention to the Nottingham hub—the £67 million station improvement project to be jointly delivered by the city council and Network Rail to transform our railway station into the sort of modern transport interchange that the city needs. Everything is in place between the city council and Network Rail. The only piece of the jigsaw that is in doubt is the contribution from East Midlands Development Agency. We in Nottingham value EMDA and the important role that it has played in the city and the region. Securing its future is a discussion for another day, but we hope that the changes to regional development agencies will not be allowed to undermine this project and the opportunity to create a wonderful new entrance to the city.
Earlier this week the Prime Minister spoke about the review of spending commitments and said:
“Projects that are good value for money and consistent with the Government’s priorities will go ahead.”—[Official Report, 16 June 2010; Vol. 511, c. 868.]
I know that we in Nottingham can demonstrate that our plans meet this test. Can we afford to go ahead with these schemes? The real question is, “Can we afford not to?” and the answer is most definitely no. These transport schemes are absolutely vital to the economy of Greater Nottingham and the East Midlands region. They will deliver on jobs, on regeneration, on cutting unemployment and on improving access to training and skills. They will help us to meet the targets for a greener low-carbon future. They represent excellent value for money. If we need to be a bit more flexible on what we are asking for, tell us. We will be, but do not leave us stuck in the slow lane when it comes to economic growth. It would be short-sighted and very costly to delay these well-thought- out, well-planned projects for the sake of small savings now.
As I draw my remarks to a close, I would like to ask the Minister the questions that people in Nottingham are asking me. Have the Government produced an analysis of the impact that delaying or cutting these projects will have on local and regional economic growth? What criteria will the government use to assess which major projects to continue funding? When will the decisions be made and who will be making those decisions?
Finally, will the Minister accept my invitation to come to Nottingham to see the congestion we face on the A453, to enjoy a trip on the tram, to look at the exciting plans for the railway station and to hear from residents, businesses and councillors from all parties about why investing in our infrastructure is vital for the future of Nottingham?
The Parliamentary Under-Secretary of State for Transport (Norman Baker)
I begin by congratulating the hon. Member for Nottingham South (Lilian Greenwood) on securing this debate on transport infrastructure for Nottingham and the surrounding area, and on the comprehensive and persuasive way she put her case this afternoon. I am aware that she made her maiden speech in the House a few weeks ago and mentioned both the A453 and the Nottingham tram. I am now pleased to be responding to her first Adjournment debate on a subject that is clearly of great importance to her, to other hon. Members and to her constituents.
No one doubts that an effective and efficient low-carbon transport infrastructure can help to support economic development and help to tackle climate change. Unfortunately, securing these outcomes in our current economic climate is challenging to say the least, but I am confident that we can meet these challenges and still deliver transport infrastructure that works for economy and the environment. I draw the hon. Lady’s attention to the coalition Government’s statement, to which she referred in her opening remarks, in which we have made clear our commitment to a modern low-carbon transport infrastructure as an essential element of a dynamic and entrepreneurial economy. She may also have noticed that light rail is specifically mentioned in the agreement. But we have also identified the pre-eminence of the deficit reduction programme at this time. The decisions that we take and the speed with which we are able to implement transport improvements will need to be determined in the light of the comprehensive spending review.
The hon. Lady asked about the criteria for assessing major projects, and I shall come to that point in a moment. She asked when and who will make decisions. Initially, the Treasury’s comprehensive spending review will tell us how much money the Department has in crude terms, and we shall then use the criteria to take the decisions. I am conscious of the uncertainty not just in Nottingham but across the country. We want to get a move on and give people clarity as soon as we possibly can.
The Department for Transport is playing a full part in the spending review that will report in the autumn. We have already announced a range of measures aimed at delivering reductions in spending. On 24 May, the Chancellor of the Exchequer and the Chief Secretary to the Treasury gave details of savings of £6.2 billion in Government spending in 2010-11. The Department for Transport is contributing to those savings, which has meant taking difficult decisions on funding and deferring decisions on schemes, including the A453, until after the outcome of the spending review.
Last Thursday, the Department for Communities and Local Government published further details about local government savings, including £309 million that the Department for Transport had identified in respect of local transport. In making those reductions, however, we have maximised flexibility for local authorities to reshape their budgets according to local priorities and to identify where efficiencies can be found. Given current financial constraints, it is essential to ensure that any new infrastructure is affordable and offers value for money.
On the criteria for assessing major projects, the hon. Lady may be interested to learn that my Department is committed to reforming the way decisions are made about which transport schemes to prioritise across the country. We are looking at the formula used to assess transport schemes so that the benefits of low-carbon proposals are fully recognised. We hope that work will be complete to coincide with the outcome of the comprehensive spending review so that we can take sensible decisions at that time.
Before I respond to the hon. Lady’s specific points, I acknowledge Nottingham city council’s high reputation as a transport authority. It has successfully managed major innovative projects, including the building of the tram. It is a beacon council for accessibility and has taken great strides in managing congestion in the area, as the hon. Lady pointed out. By August 2009, vehicle journey times during the morning peak had been reduced by almost 7% on baseline figures.
The Greater Nottingham transport partnership provides a good example of bringing together the private and public sectors to promote understanding of and support for the integrated vision contained in the joint local transport plan. From that partnership has come the “Big Wheel” marketing campaign, which has worked successfully to influence the use of sustainable transport options.
Nottingham City Transport picked up the winning new customers award at the 2009 UK bus awards, and in May this year the biggest, and first area-wide, statutory bus quality partnership was launched. Nottingham has seen year-on-year increases in bus and tram use. There are now 47 million bus passengers per year in Nottingham and 10 million tram passengers. With that base from which to work, I am confident that Nottingham City Transport is in a strong position to respond to the difficult financial climate we are now facing.
I understand the concerns expressed on both sides of the House about the decision to defer spending for the A453 scheme until the next comprehensive spending review period. I do not want to introduce a note of discord, but I point out gently to the hon. Lady that the previous Government had 13 years to do something about the road, but did not. She might bear that in mind as we consider how to go forward.
Following consideration of the scheme orders for the A453 at the public inquiry in 2009, the inspector’s report was submitted to the Secretary of State for consideration. However, no decision on the inspector’s report and the scheme orders can be made until there is clarity about the availability of funding for the scheme following the forthcoming spending review. As the scheme is subject to statutory procedures, I hope the hon. Lady will understand that I cannot, for reasons of propriety, discuss the merits of the A453 project in the Chamber this evening. I can assure her, however, that the scheme will be given due consideration alongside other proposals. Her comments and those of other Members are noted.
On the proposed tram extensions, the Government announced last week that we would consider schemes funded through the regional funding allocation process as part of our commitment to review the way funding decisions are made on which transport projects to prioritise. However, as the hon. Member for Nottingham East (Chris Leslie) said—I nearly called him the hon. Member for Shipley—the Nottingham project is slightly different. The extensions to the Nottingham express transit tram scheme are proposed to be funded almost entirely through the private finance initiative. The Government, through the Treasury, plan to make an announcement shortly on how we are dealing with PFI schemes, and it may be that more clarity can be given on the tram scheme at that point.
I would just say that the feeling I have picked up from speaking to Members on both sides of the House is that whether people were for or against the tram, there is acceptance—the route has been planned, it has been accepted, it has been established, and the issue now is really one of cost and finance rather than anything else.
Chris Leslie
It is entirely correct that it feels very much as though we have come so far—on the planning process, the commitment of all the legal fees and the consultancy fees, getting through the planning inquiries and so on—that it would be such a shame to decide not to progress at the eleventh hour, particularly when, as I said before, this scheme may not be so burdensome in its public borrowing aspects as perhaps others would.
Norman Baker
I do understand that point, and I am sure it is frustrating for Members all across the House, looking at various schemes in their own patches, to see this delay. I stress that it is a delay, rather than a cancellation—simply a deferral of schemes. We do want to get decisions as soon as we possibly can on all these schemes, but as to whether the PFI is good value for money, that is above my pay grade. It is a matter for Treasury Ministers to decide, although obviously the comments that the hon. Gentleman and others have made will be picked up and relayed to my colleagues in the Treasury.
I should record that the tram has been successful, carrying 38 million passengers—well above the projected figures. That is also a matter to take into account in looking at the future. So I can assure the hon. Member for Nottingham South that the Department understands the potential for trams, in the right conditions, to deliver a high-quality public transport alternative to the car. I believe that, as she rightly says, we have underplayed the potential of trams, and light rail in general, in this country. I am conscious that proposals have failed in the past, usually on the basis of high cost. She may like to know that I have asked officials to look at the reasons for the high cost of tram schemes, and to see whether there are any ways to reduce those costs to make trams a more affordable option in the future, particularly given the likely pressures on budgets following the spending review. That work is being carried out in the Department, coterminous with the work carried out in the Treasury, so that when the smoke has cleared, light rail will be in a position to benefit, potentially, from the new arrangements post-review.
As I mentioned earlier, the Department is taking forward work to deliver the coalition agreement commitment to ensure that low-carbon benefits of schemes are fully recognised in the transport appraisal decision-making process.
The hon. Lady mentioned the workplace parking levy, and of course it has been seen that the tram extensions proposed are closely linked to the plans for a workplace parking levy to be implemented in Nottingham, although of course there is no requirement for them to be so and it is open to the city council, if the tram did not go ahead, to introduce that levy if it wished to do so. Workplace parking levies are one of a range of measures available to local authorities for improving local transport and tackling congestion. Nottingham city’s plan to implement a levy is very much in accord with the coalition’s localism agenda, and I want to make it quite clear from the Dispatch Box tonight that whatever individuals in the House think about that levy, our view is that it is entirely a matter for the local authority to decide whether that goes ahead or not; it is not a matter for the Government to intervene in.
The hon. Lady also mentioned the Nottingham rail hub and improvements to Nottingham station. I know that work is in hand to develop plans and prepare for improvements in Nottingham railway station and the surrounding areas under the Nottingham hub scheme. That includes work to complete the necessary agreements to enable the scheme to proceed. I should deliver the usual health warning about the current financial climate, which the hon. Lady is well aware of, and the fact that we cannot offer assurances at this particular time about taking forward a scheme, although, as she referred to the contribution from the regional development agency, I would just say that obviously if the scheme could be reduced in cost in some way, that makes it more likely to proceed. I hope she might take that message back to colleagues and others in Nottingham. We in the Department do believe, however, that it is a good scheme, which has the potential to deliver wider benefits, including the regeneration and employment benefits that the hon. Lady mentioned, in addition to improving transport links in Nottingham.
It is clear that we face a challenging period. Tough decisions to tackle the UK’s budget deficit have been necessary, and they are ongoing. I appreciate, however, that it is not easy for people to see schemes with considerable local support, that have been in development for many years, being put on hold and given an uncertain future. The Government have identified that the most urgent priority is tackling the deficit, and the Department for Transport must play its role in that process. The Department will be in a position to identify major investment that can be supported only after the Government’s spending review has been concluded. In a period in which we face tight financial restraint, it is essential that we take a step back and consider which schemes should be prioritised. That is the only way we can put ourselves in a strong position to make the best use of available funds and to establish a strong base for the future development of the transport system.
I would not want the hon. Lady to go away from the debate with a negative impression, however. We face challenges, but we have a strong approach to address them, and the Department wants to work to deliver outcomes that meet national and local needs, and to improve the country’s transport infrastructure. We are keen to use whatever tools we can to achieve that.
I thank the hon. Lady for the invitation to visit Nottingham, which I shall be happy to accept, because a tram ride with her is an irresistible suggestion. I look forward to seeing some of the excellent schemes that Nottingham city has been delivering.
Question put and agreed to.
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Westminster Hall
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Alternatives to Child Detention
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The Minister for Immigration (Damian Green)
I am delighted to have the opportunity today to draw attention to the issue of children in immigration detention. The UK’s policy of detaining children with families in order to effect their removal from the UK is an area of long-standing concern for many organisations that take an interest in immigration and asylum, and for organisations that work on behalf of children. Those concerns are significant, and the Government have, very early on, set out their commitment to ending the detention of children for immigration purposes. We want to replace the current system with something that ensures that families with no right to be in this country return in a more dignified manner.
To help bring that about, the UK Border Agency is leading a comprehensive review of present practice on the detention of children. It will look at the actual levels and at how to prevent such detention by improving the current voluntary return process. The review will also consider good practice in other countries, and will look at how a new family removals process can be established that protects the welfare of children and ensures the return of those with no right to remain in the UK. It will come as no surprise to you or to the Chamber, Mr Weir, that in the current climate the review will also have to include value for money as part of its remit.
The review has already begun and its phase of collecting views and submissions will run until 1 July. It will take in the views of a wide range of partners, experts and organisations that represent the interests of children to create viable long-term solutions. Earlier this week, I went to Glasgow to discuss the matter with many voluntary groups. They made extremely useful inputs to the review, so we will be repeating those meetings in all regions and in other countries of the UK over the next few weeks.
The Diana, Princess of Wales Memorial Fund is helping the review by co-chairing a working group made up of a range of non-governmental organisations, and I am grateful to the fund for agreeing to do that. We are seeking to identify how the UK Border Agency can fulfil its role while taking the right account of children’s safety and welfare. We are carrying out the review as fast as humanly possible, so that the detention of children for immigration purposes can end and a practical alternative be put in its place.
I should emphasise that the UK Border Agency is fully determined to replace the current system with something more humane, without compromising on the removal of people who have no right to remain in the UK. We are talking about alternatives to detention and not about ending removals. Until the review is completed, current policies will remain in place, with one exception. As Members will know, the detention of children overnight at Dungavel immigration removal centre in Scotland has been ended as a precursor to such a practice ending across the UK. Currently, a very small number of children—fewer than five—are being held in immigration detention, but before we close Yarl’s Wood for the detention of families we need to find effective alternatives.
Damian Green
I will of course give way to the newly elected Chairman of the Select Committee on Home Affairs.
Keith Vaz
I thank the Minister very much for letting me intervene. I welcome this review, which is very much in keeping with the report the Select Committee produced last November. One of the recommendations was for the then Government—clearly, it is now for the new Government—to look at the role of local authorities. Will he confirm that local authorities will be consulted? The Committee was concerned that councils were sometimes not aware of children in their jurisdiction, and that that led to some children absconding and councils simply not being aware that they had gone.
Damian Green
I am grateful to the right hon. Gentleman for that intervention, and I take the opportunity formally to congratulate him on his election—his reappointment, rather—as Chairman of the Home Affairs Committee. I can do so with a due degree of objectivity because I was not allowed to vote in the election, so he can neither thank nor blame me. I am sure we will have many constructive exchanges in the coming years.
To address the right hon. Gentleman’s point, the simple answer is yes. I mentioned earlier that I had had a meeting in Glasgow at which the city council played a significant, helpful and constructive role. The purpose of the consultation is for it to be as widespread as possible. As he said, local authorities will have statutory responsibilities for such children and will therefore have views about how best we can and should proceed, so I will very much welcome their input into proceedings.
The challenge is to develop a new approach to family removals that remains cost-effective and delivers the return of those who have no right to remain in the UK. I hope I will not be constraining the review if I identify some of the factors involved; indeed, I hope this will help those who wish to contribute. It is already clear from the initial stages of the review that there is not a single, simple remedy: it is not just about ending detention at the stroke of a pen. There may have to be—I think there will have to be—a number of changes at different points in the system, each contributing to the overall aim. Clearly, there is a need to achieve faster and better decision making on family asylum cases; we are already taking forward work on that. We are told there is a need for greater confidence in the initial decision that is made in asylum cases. I take on board that message; indeed, I may even have transmitted that message to Government in the past.
In a recent report, the UK Border Agency’s independent chief inspector, John Vine, commented favourably on the commitment to quality, and the UK is felt by many countries to have good systems in this regard. Members may know that in 2007, the provision of early legal advice was piloted in Solihull, in the west midlands, to test whether collaboration between the legal representative and the UK Border Agency decision-maker led to better information at the initial decision-making stage, so that better quality decisions could be reached. The findings were unclear, so we are working with the Legal Services Commission and key asylum partners to test those principles across an entire region of the UK Border Agency. It is called the early legal advice project, and it is an example of collaborative working and trying new things that I hope will characterise this area of alternatives to detention for families.
Another thing to consider is the need for better contact management and more active discussion of a family’s options if their claim is rejected and their right to appeal a decision has been exhausted. Discussions with a family might need to be backed up by improved support from NGOs, partners and other workers. The options open to families at present include some very generous assisted return packages, but the take-up rate for families is low compared with that for single asylum seekers. There is, therefore, a need for better marketing of those assisted return offers. Marketing may sound like an odd word in this context, but I use it because we should not be forcing the take-up of such offers. Better explanation and promotion of the offers is clearly needed; they are real offers to provide help and assistance when all the other options have been exhausted. To illustrate one apparently small but important point, the assistance includes help with excess baggage so that families can take with them belongings purchased in the UK. They would not be returning home empty-handed, and would have more to show for their migration journey and for their time in the UK.
I think that everyone involved would also like to see a clearer and more evenly managed process after applications and claims to remain have been turned down. The starting point—and what I hope will become the standard—would be a much more clearly identifiable transition from a voluntary departure to an enforcement approach that is shaped by the family’s own approach to their situation. The UK Border Agency would therefore set removal directions while the family is in the community, giving the family time to submit further representations and to apply for a judicial review if they wish to do so, as well as giving them time to make plans for their return. The arrangements would place a greater emphasis on self check-in or escorting to the airport. That approach, which already exists but possibly in a less clear way than it ought to, gives families every chance to comply with the need to return home without enforcement action. Making it much clearer to families—and their helpers—where they stand at this stage of the process seems to me to be necessary.
Other changes to processes may be called for, but inevitably some families who have no justification to remain in the UK will always refuse to leave voluntarily, despite all the encouragement we give them to do so. A changed approach should, and I hope would, minimise the number of those families, but there will remain difficult cases where solutions have to be found and where enforced removals are likely to continue. That approach could involve separating different members of a family and reuniting them before departure, so that some family members stay in the accommodation they are used to. However, I recognise that that approach would be hugely contentious and has its own practical difficulties. Therefore, in some cases we may still have to have recourse to holding families for a short period before removal—where keeping the family together is seen as being in the best interests of the children, which of course must be the paramount concern.
I hope it will not come to that. The Government and the UK Border Agency would much prefer that families who do not require humanitarian protection or refugee protection return to their home countries voluntarily. That is a responsible approach in a world where the number of people who choose to live in another country, for a variety of reasons, is continually expanding. Not everyone’s journey will be a success in economic terms; not everyone’s journey will be lawful. We believe that the Government should respond in a responsible, fair, dignified and humane way to this reality.
Keith Vaz
I thank the Minister for giving way to me for a second time. Will he comment on the report in The Guardian today that the Government are considering a reintegration centre—basically, a detention centre—of some kind in Afghanistan for families who are due to be removed from this country? Is that report correct, or wrong?
Damian Green
I would always hesitate to describe a report in The Guardian as being completely accurate. The proposed centre in Afghanistan is not particularly a British Government project; indeed, the previous Government raised this idea with other European Governments and with international agencies. The proposed centre’s purpose is, effectively, to have a retraining centre—a re-entry centre—in Afghanistan, which the right hon. Gentleman will know is the source of many unaccompanied asylum-seeking children in this country, so that there is something for those children to go back to that will enable them to lead a better life in Afghanistan. I suspect he agrees with me that it would be much better for those young men to have a decent life and some hope in life in their own country. If they can have those things, that will stop many of them making dangerous—in some cases, sadly, fatal—journeys halfway across the world to try to reach Britain or other European countries.
So the basis of the report in The Guardian, for all that I said in my initial response to the right hon. Gentleman’s intervention, is true, but it is being presented in a luridly and unfairly hostile light. The centre is an effort to help people. I suspect that the hon. Member for Hackney South and Shoreditch (Meg Hillier), the Opposition spokesperson, will agree with that, because she was in government when the then Government originally suggested this process. It is a constructive and creative response to the problem of unaccompanied asylum-seeking children, and to present it in any other light is straightforwardly unfair. It is a constructive idea and I hope it comes to fruition. The tender for the operation is being examined, and we hope to make an announcement in the next few months about what will happen next.
This is a real, worldwide problem and as I was saying, we believe that the Government should respond in a responsible, fair, dignified and humane way to the reality of what is happening around the world today. The review into ending the immigration detention of children is an important part of that. Obviously, we will not take any firm decisions until the review has completed its work and we have taken into account the views that are put to us. I hope that during this debate, more ideas will be put forward that the Government can feed into the review, which may therefore give us what we all want to see: a fairer and more humane system that ends the system of detaining children for immigration purposes in this country.
Keith Vaz (Leicester East) (Lab)
I begin by congratulating the hon. Member for Ashford (Damian Green) on his appointment as Minister for Immigration. I attended many debates with him in his Opposition capacity, but he has finally made it and now has the opportunity to put into practice all the good proposals for which he argued so strongly as the Opposition spokesperson.
I also pay tribute to my hon. Friend the Member for Hackney South and Shoreditch (Meg Hillier) for all the work that she did as an Immigration Minister in the last Government. She was always very firm in defence of the Government’s policy, but she was also very willing to listen to Members of this House when they raised matters of concern with her. I am glad that she has retained her position as the Labour party’s spokesperson on immigration in opposition, because of course she knows everything—where all the bodies have been buried, figuratively speaking.
I welcome most warmly the Government’s decision to conduct a review of the whole question of the detention of children in the immigration system. It may well be that during the general election campaign, the Minister read the reports of the Home Affairs Committee. If so, he will have seen our report published on 24 November 2009, “The Detention of Children in the Immigration System”. In a sense, he has prefaced that report in the comments that he has made today. He has also rehearsed some of the arguments that are used for keeping children in detention, while rejecting those arguments. Of course, one cannot prejudge the outcome of a review, but I would be most surprised if the Government, having begun a review on this very important subject, came to the conclusion that everything was okay as far as the detention of children in the immigration system was concerned.
Nearly 1,000 children a year are detained in the UKBA’s immigration detention centres. On average, such children spend more than a fortnight—15.58 days—in detention, but detention for up to 61 days is not uncommon. On 30 June 2009—the last date for which the Home Affairs Committee had information on children in detention—10 of the 35 children in detention at that time had been held for between 29 and 61 days. The Committee noted that the cost of keeping a person in detention was £130 a day; therefore, keeping a family of four in detention for between four and eight weeks costs more than £20,000.
During our very brief inquiry into this area, Members of the Committee visited Yarl’s Wood. We felt that there must be an alternative that can be used to deal with the Government’s proper function, which is to ensure that those who have lost their immigration cases and who have not been granted leave to remain in this country, either as asylum seekers or in any other context, are removed. I think that all of us, on both sides of the House, accept that there cannot be an indefinite right for people to stay here after all the legal processes have been exhausted. What we must find is a humane way to deal with families, particularly children, who are kept in detention before their removal.
We went to Yarl’s Wood after hearing serious allegations about its operation, and what we found was a much more humane regime. Ultimately, of course, Yarl’s Wood remains a prison; one cannot walk in and out without being checked through. When the Select Committee arrived, we produced all our identification and were put through those checks. I am not sure whether the Minister has had an opportunity to visit since taking up his office; I am sure that the shadow Minister visited at some stage. Some the reports of conditions in Yarl’s Wood were lurid, and it may well have been like that in the past, but certainly nothing like that was obvious to us when we visited. The staff made an effort to accommodate families and children. We saw an impressive nursery school that had been built. It did not deal with anyone over the age of 10; it dealt with young children.
Unfortunately, our visit was somewhat marred by the Home Office officials’ terrible anxiety about the Select Committee visit. They tried hard to keep us away from the people being detained there, which was totally unnecessary. The point of Members of Parliament visiting an institution such as Yarl’s Wood is to ensure that we speak to the people there about their circumstances. What we found was that people were more anxious about the progress of their immigration case than about any of the ways and means by which they were detained I hope that, even before the review is continued, the Minister will take on board the fact that people in detention need access to proper and appropriate legal and immigration advice. I left the detention centre with about five or six cases, which I immediately passed on to the relevant constituency MPs.
It was depressing to see children being kept in such circumstances. Of course the Serco staff did their best to ensure that they were kept happy—there was a little shop, for example. We talked to a couple of the kids about what it was like being there. Though it is acceptable for a very short period, it is still a prison, it is still detention and their freedom is still restricted. The review is therefore timely and important, and I hope that it will be concluded as quickly as possible. As I missed the first few words of the Minister’s opening remarks, I am not sure whether he has a timetable. The Government are undertaking a lot of reviews, and although I do not hold that against them—any new Government want to review everything that happened before—we need timetables. Under the current system, however, it is important that people should be clear where they stand as far as their future is concerned.
I raised with the Minister the question of the local authorities’ involvement. We took evidence from the London borough of Hillingdon, because it contains Harmondsworth centre and Heathrow airport—those put into detention after coming off a plane and those about to be removed are held in close proximity to airports. One of the Select Committee’s recommendations was that the Government’s future building programmes should take proximity to airports into consideration. We were concerned to find that the local authority did not seem to know how many children were being detained and that it was not notified when children left detention. That is why we recommended that local authorities should be informed every seven days of how many children are being detained in their area. That would be quite a simple process for UKBA, so it is surprising that those facts and figures are not available. I hope that, in the interim—before the review is published—we will look at what we can do to get that information to local authorities. That must be easy for UKBA to do, so I hope that it will be done.
I do not want to detain the House long, given that the Government seem to be doing everything that the Select Committee asked them to do. My final point is a general one to which I will keep returning as long as I occupy the Chair of the Select Committee. I want to be fair to this Government as I was fair to the last one, and the former Minister will remember that on every occasion when we discussed immigration, I raised the same issue: the state of the backlog in the administration of the Home Office.
I see that the hon. Member for Croydon Central (Gavin Barwell) is here today. I am not suggesting for a moment that we should move the Home Office away from Croydon, as I am sure that a lot of his constituents work there and that Lunar house and all those other fine buildings contribute greatly to Croydon’s economy. However, it is not acceptable for us to go on as though the backlog will only be here until next year. The Select Committee is due a letter from Lin Homer setting out the state of the backlog, and of course progress has been made in the past 13 years, but I asked the then Minister for Borders and Immigration, my hon. Friend the Member for Oldham East and Saddleworth (Mr Woolas), whether he would like to be the first Immigration Minister in history to leave office having cleared the backlog. For as long as I have been a Member of Parliament—23 years now—there has always been a backlog. When I was first elected, there were sacks of unopened letters in Lunar house, simply because the volume of correspondence was so great.
I know that the Minister has written to right hon. and hon. Members about how we deal with constituency cases. Looking around the Chamber, I think that all of us here have a smattering of immigration cases, some more than others, and the shadow Minister is probably the biggest consumer of her former portfolio than anyone else here. It is all very well to tell Members to write to officials at Croydon and to come to Ministers only as a last resort, but we all get the same letters back, drafted by the same person. Miss Homer, as director general and chief executive, takes ultimate responsibility—this is not a personal issue; it is just business, as they said in “The Godfather”—but the fact is that all the letters are the same. We do not expect the Minister to draft his own letters, but we get the same information whether we write to Miss Homer or to him. UKBA keeps telling us that we must wait until next year for the backlog to be cleared.
That is the problem for children in detention. If only the system actually worked and gave us quicker results, even if those results did not please people and the cases still went through judicial review. I declare an interest: my wife is an immigration lawyer and I worked in a law centre before I was elected, and the process does, of course, make work for lawyers. People apply for judicial review only if they have no other option, but at present, they apply for judicial review at the end of a three-year process. If we had dealt with their cases more quickly, some asylum seekers would not have had their children. Some of the children in detention are there because their parents’ cases have taken so long to be concluded.
In the spirit of a new Government with a fresh approach, I say that eliminating the backlog and dealing with immigration cases quickly is the best way to solve the problems of needing to build more detention centres and to keep children in detention. I know what the Minister will say: “You were in office for 13 years. Why hasn’t this been solved?” Believe me, I and others have been asking Governments for the past 20 years to do something about it.
Administrative delays have become an essential part of immigration policy, which means that people in this country are working illegally because they are waiting for their cases to be concluded. People come to me every week—tomorrow I will see another 50, and on average I deal with 60 immigration cases a week—who are desperate to work but cannot because they are waiting for UKBA to deal with their cases. Some cases take between six and seven years to be concluded. Dealing with those issues must go hand in hand with the Government review.
The Minister’s biggest battle will be against the Chief Secretary to the Treasury and ultimately the Chancellor, but the Home Affairs Committee will be on his side arguing, as it has done in the past, his case for more resources for UKBA and to clear the backlog. UKBA is full of good and decent people, but the system needs changing. We have constantly asked for greater expenditure but, obviously, no Minister for Immigration has ever said in a debate, whether in Westminster Hall or the main Chamber, “Please can we have more money?” That would breach the convention of Government. The Select Committee will say that for him.
Even in the current climate, providing resources will save the Government millions and millions of pounds spent every year on detaining people, including families and children, and forcibly removing those who have been here for seven or eight years. Let us not get into that situation. Let us deal with cases as quickly and efficiently as possible so that we do not have to detain or lock up children any more. We can allow people their chance of a fair hearing before the courts and eventually before the Minister, and then the results that the Government put forward must be accepted.
Gavin Barwell (Croydon Central) (Con)
Like the right hon. Member for Leicester East (Keith Vaz), I congratulate my hon. Friend the Minister on his appointment. I have known him for some time and, given the values that I know he has, I think that he will balance the need to reform our asylum system, to ensure that people who do not have a right to be in the country return home, with compassion for those who come here seeking sanctuary. It is a great privilege to follow the right hon. Member for Leicester East. He referred to his work in the previous Parliament as Chairman of the Select Committee on Home Affairs and its report on the issue before us today.
Immigration and asylum, which are too often conjoined, are important in my constituency. The right hon. Gentleman referred to the UK Border Agency in Croydon Central; its significant presence has a number of effects on my constituency. First, a large number of people are going through either the immigration or the asylum process, which has been the dominant issue in my casework in the four or five weeks I have been an MP. Secondly, as the right hon. Gentleman implied, a significant number of UKBA employees are my constituents, so there are some interesting letters from people about their experience of working in the system and how it might be improved. On another occasion, I might share some of those views with my hon. Friend the Minister.
Thirdly, there is a significant impact on our local authority, and the right hon. Gentleman talked about the issues. The London borough of Croydon, as a social services authority, has responsibility for more than 700 unaccompanied asylum-seeking children. That compares with about 300 children from Croydon, so its social services role is very different from that of many other local authorities. Finally, immigration and asylum is a big issue with residents. Croydon has seen significant demographic change over the past 10 or 20 years. I am pleased to say that in most parts of my constituency, and most parts of the town, relations between different communities are good. However, in a few areas there has been significant activity from the British National party. I am pleased that it did not make the predicted breakthrough at the recent local elections.
Immigration and asylum was also a significant issue in the general election campaign. I suspect that other right hon. and hon. Members here today were contacted by Citizens for Sanctuary during the general election and asked to sign the sanctuary pledge. It gave me far and away my most uncomfortable moment during the campaign because I strongly feel that it is inappropriate to detain children, but, given that the party manifesto did not contain a specific commitment to end the practice, I felt that it was inappropriate for me to make a pledge without confidence that it could be delivered. The issue is important to me personally and to my constituency. I know that my hon. Friend the Minister has visited Yarl’s Wood on several occasions and has spoken publicly about how distressing he found seeing children who are effectively behind bars.
The evidence in favour of changing the approach of the previous Government has been mounting for some time. The first UK study of its kind on the subject was published on 15 October last year in “Child Abuse & Neglect: the International Journal”. A team of doctors examined 24 children detained at Yarl’s Wood immigration removal centre. They found that the majority were experiencing mental and physical health difficulties related to being in detention. The Royal Colleges of Paediatrics and Child Health, of General Practitioners and of Psychiatrists, and the UK Faculty of Public Health produced a long and detailed report. Dr Philip Collins, a forensic adolescent psychiatrist representing the Royal College of Psychiatrists, said:
“The harsh reality about this country’s immigration policy is that we are significantly damaging the mental health of many of the children and young people who end up—through no fault of their own—being detained in a prison-like environment by the UK Border Agency. The evidence is clear: this policy directly harms the mental health of children and young people. That is why the Royal College of Psychiatrists calls on the UK Government to end this practice without delay.”
On 17 February this year, we had the report of Sir Al Aynsley-Green, the former Children’s Commissioner for England:
“Children continue to report that they find the process of arrest and transportation distressing. Increasingly, children are separated from parents when transported to the centre. Most are not told what will happen to their belongings and pets left behind and many have difficulty contacting friends.”
While acknowledging that health care standards improved, the report states that significant areas require attention, saying that
“a mother informed the nurse at 11.20 pm that her five year old child had fallen earlier in the playground. The child could not lift her arm and was not seen by the GP until 2.05pm the next day and went to A&E at 7.02 pm,”
the next evening, and was found to have a fracture.
There is also the report of Her Majesty’s inspectorate of prisons, which, to be fair to the previous Government, noted that conditions, services and support for children, including a new school and better health care, have improved:
“However, given that the fact of detention adversely affected children’s welfare, inspectors were concerned that their detention did not appear to be exceptional or necessary, given that half the families detained were later released under temporary admission.”
As I say, the evidence that the policy the previous Government pursued was wrong has been mounting for some time. It must surely be possible to balance the need to remove those with no right to be in this country with the need to protect the welfare of children. I was glad to see in the coalition agreement a commitment to end the detention of children, which takes on the Home Affairs Committee’s recommendations and, arguably, goes a little further. My hon. Friend the Minister has announced that the review is under way. I hope that the hon. Member for Hackney South and Shoreditch (Meg Hillier) will confirm that the official Opposition will reconsider their approach.
I have a few questions for my hon. Friend before I close. The right hon. Member for Leicester East touched on the first: how long will the review take? I understand that while it is being carried out, some detention will continue but a time scale would be helpful. In his opening remarks, my hon. Friend ran through the options that will be considered as part of the review; one was potentially separating families so some family members could remain in their home. I was pleased to hear that he recognised that that would be contentious. If we move from detaining children to breaking up families, it could be a case of out of the frying pan, into the fire. Will the Minister tell us more about the pilot scheme looking at possibilities away from detention that UKBA has been running in Glasgow? The initial results showed that there had been some success, with people voluntarily choosing to return to their country of origin.
Will my hon. Friend tell us a little about the case management approach that a number of other countries have adopted in recent years to end the practice of detention? He talked a little about that in his opening remarks, but I understand that the policy that has been pursued in Sweden, for example, has reached the point where more than three quarters of families now voluntarily agree to return to their place of origin.
In conclusion, I thank you, Mr Weir, for the opportunity to speak in the debate. I was extremely gratified to see that the commitment to act on this issue was in the coalition agreement. I am also gratified to see that the Minister has already acted to set up a review, and I look forward to hearing how he intends to take it forward.
Ms Diane Abbott (Hackney North and Stoke Newington) (Lab)
I am grateful to have the opportunity to speak in this important debate. The issue is important not only because of the numbers of children who are detained, but, sadly, because it symbolises how far the Labour Government had gone, in some aspects, from the ideals that motivate many millions of the party’s supporters.
When I raised the issue on the Floor of the House about two years ago, I was one of the first people to do so. I have visited Oakington detention centre and Yarl’s Wood, and I have had two debates on the Floor of the House about children in detention. As hon. Members will have heard earlier, and as they will certainly have read in the documentation, no reputable organisation defends this practice, which almost certainly puts us in breach of the European convention on human rights. All reputable organisations—whether it is United Nations organisations in this country, Save the Children, the Refugee Council or Liberty—are united in opposition to this practice.
The practice of detaining children is wrong in principle. What are we doing detaining children in custody when they have committed no crime? Hon. Members might be surprised to know that when I discuss the issue with friends and colleagues in foreign legislatures—even those in third-world countries—they are surprised that Britain, of all countries, detains children indefinitely. When looking at these issues, we must always remember that the history of empire means that people look to Britain to set an example, but we are not setting one on this matter.
Detention was wrong in principle, and it was almost certainly in breach of a number of human rights conventions, but it was also wrong in practice. I know that because I have visited the detention centres. Ministers will tell us about the improvements, and they will tell us that everything is the parents’ fault because they should have left when they were supposed to. However, when we go to the detention centres to meet the families and the children, particularly if we have children ourselves, it is brought home to us on a level that we cannot put down on paper—even in excellent reports such as those by the Home Affairs Committee—what it means to children to be detained and deprived of their liberty. However wonderful the facilities, the children cannot run outside as far as the eye can see. As far as they are concerned, they are behind four walls. They have almost certainly been brought into detention in traumatic circumstances, such as after a morning raid, and they find themselves locked up for reasons they can scarcely comprehend—and locked up, in their view, is what they are. Unlike my hon. Friend the Member for Hackney South and Shoreditch (Meg Hillier), who will speak for the Opposition, I have actually visited the detention centres and the children. Detention is a restriction of children’s liberty, and they face the trauma that that entails.
There are also issues about the conditions, some of which were dealt with by the Labour party when it was in government, but some of which were not. At Yarl’s Wood, in particular, there is an inflammable atmosphere. We have just had riots, and there have been all sorts of problems. Most recently—earlier this year—women were on hunger strike. Part of that inflammable atmosphere has to do with the underlying tension about the fact that children are detained at Yarl’s Wood.
Party colleagues will say that the parents chose not to go home at the first time of asking, so they are responsible for their children’s being in custody. Whenever I raise the issue on the Floor of the House, I hear that it is not the Government’s fault and that the parents are responsible, but where in the practice of justice and in the way in which this country is run are we in the business of punishing children for what their parents have done?
Keith Vaz
There is another issue, which I raised in my speech. Why do people have to wait so long for their cases to be dealt with? Does my hon. Friend agree that dealing with cases in a more timely fashion and clearing the Home Office backlog would help to make the system more humane? She is absolutely right about the detention of children, but the reason why we have so many cases is that they are not being dealt with quickly enough.
Ms Abbott
My right hon. Friend has great experience as a constituency MP. He probably does more immigration casework than any constituency MP, and he has been doing it for 23 years. Added to that is his experience as the Chair of the Home Affairs Committee. He makes an excellent point: the delays help to create an intolerable situation for people trapped in the system.
I am one of the longest-serving Members of the House present today, and I remember when detention centres were introduced. The House was told that they would be used only for short periods while we fast-tracked cases and deported people. Had the House been told that children, in particular, would be in these centres for months—there have even been cases of children being in them for nearly a year—it might have taken a very different attitude. A system that was meant to be used for short periods of detention while people’s cases were fast-tracked has turned into one—I have visited the detention centres myself—in which people and their children are held in limbo. That is one of the things that make this practice so unacceptable.
As I said, the detention of children is wrong in principle; it is wrong because it is an infringement of their liberty. It is also wrong because, in a way, we are making children and families suffer for the issues in our system, and the delays are very much part of that. We set a very poor example to other countries and other jurisdictions if we cannot construct a system in which it is not necessary to detain children.
The purpose of the detention centres, apart from expediting removals, was to act as a deterrent. There has been a strong feeling over the past 13 years that the grimmer and more exacting we made the regime for asylum seekers and immigrants, the less likely they were to come here. However, people must recognise that, for better or worse, the push-factors behind people migrating and seeking asylum are very great, and the idea that turning the screw one more time will see numbers drop has proved false.
We need to focus as never before on having an efficient and speedy system, because my right hon. Friend the Member for Leicester East (Keith Vaz) and I have spent 23 years struggling with the delays. In the long run, we also have to deal with the circumstances in people’s countries of origin that make them think, in their desperation, that they will chance their arm by coming to this country.
After 23 years of immigration and asylum casework, I would add that we also need to deal with some of the so-called immigration and legal advisers who prey on our constituents and give them false advice and false hope. Often, it is not the would-be immigrants or asylum seekers who put themselves on the path of collision with the authorities, but the advice they get from people who are feeding off them and making money out of them, even though they have little money to spend.
In the immediate term, we need to deal with the ongoing inefficiencies in the system and bear down on some of the lawyers and so-called immigration advisers. Although we are obviously very constrained, we also need, in the very long term, to create the right conditions in people’s regions of origin so that it is not necessary for them to flee here. That is the way to deal with the system.
Successive bodies and individuals have tried to get past Governments to deal with this issue. It was a particular preoccupation of a previous Children’s Commissioner and it is a preoccupation of the chief inspector of prisons, Anne Owers, who did a comprehensive report on the issue two or three years ago. As I said, every reputable organisation that has looked at this has said that the detention of children is wrong in principle and detrimental to children in practice. Medical work has been done on the consequences of the stressful situation for children, and it is very alarming. I have said before, including to my hon. Friend the Member for Hackney South and Shoreditch, when she was a Minister: how can we, the politicians, agree to keep children in circumstances that would horrify us if they were proposed for our own children?
It must be wrong to punish children for the alleged infractions of their parents. There must be a better way than that. The way, of course, as the hon. Member for Croydon Central (Gavin Barwell) said, is not to split families but to bear down on the aspects of the system—whether the advice that is given or the speed with which cases are dealt with—that lead to people being in such a plight. What has been happening is wrong. There must be a way forward that does not involve splitting up families.
I have raised the issue time and again in the House and in questions, and I have visited detention centres, not because there are votes in worrying about the children in those centres but because I felt that what was happening was wrong, and that there must be a better way. It gives me no pleasure to say that it has taken a new Government to take a fresh look at the question. I hope they will not let the tribulations of office and its practical difficulties deflect them from ending what has been this country’s shame: the detention of innocent children in detention centres.
Dr Julian Huppert (Cambridge) (LD)
Thank you, Mr Weir, for calling me to speak for the first time in Westminster Hall. It is a great honour to follow the hon. Member for Hackney North and Stoke Newington (Ms Abbott), who spoke as powerfully as ever on the issue in question. It was a great pleasure to hear her speak at the Liberty annual general meeting on Saturday; she spoke movingly about many issues, and I wish her the best of luck with her forthcoming selection process. I shall not say that I support her, as that might do her more damage than anything else.
I am delighted that the debate has been obtained, because the issue is very important. I have always felt that a good test of the underlying morals and values of a country is the way it treats people who cannot defend or look after themselves, and the most vulnerable people in society. That description applies to all sorts of groups, and child detainees are one of them. We fail the test incredibly badly in relation to them; we can talk another time about how well we do in other respects. It is a matter of great shame to this country that we treat people so badly.
The topic of the debate is alternatives to child detention. The main alternative that I can think of to detaining 1,000 children a year is not to detain them. That, above all, is what I want to say. We simply should not detain them. The suggestion that we should detain the family but not the children is at least as bad. We should not even consider something that tears families apart at what is often a difficult time for them. That leaves the question of what we can do with the children in the case in question, and before I discuss that I want to explain why I am concerned about the issue.
Cambridge has a great history as somewhere that is very multicultural and tolerant, with people from various backgrounds, and a number of people there have been involved in various ways with detainees. I might mention, in relation to the remarks of the hon. Member for Croydon Central (Gavin Barwell), that the Conservative candidate in Cambridge was one of the Conservatives who signed the sanctuary pledge; ours was one of very few constituencies where every candidate did so. I am delighted that we did, and I wish it had happened elsewhere.
We are also very near the Oakington detention centre, which has a sad and sorry history. Children are not the main focus there, but recently it hit the news because of the death of one gentleman in detention in April. I am currently dealing with a case of serious assault there. The hon. Member for Hackney North and Stoke Newington has been there to look around. I spoke to her earlier about my request to do so too: that visit was scheduled, but has now been delayed. I fear that my speaking here today means that it will be delayed further, but I look forward to the chance to see it.
Keith Vaz
On that point—I know the hon. Gentleman was not here for some of the earlier speeches—when the Select Committee asked to make a visit it took a long time to get that sorted out. When we got there, I think 10 Home Office officials attended, and only about three from Serco. There was a total of about 15; the room was full. Is it the hon. Gentleman’s wish, as it is my hope, that the new Government will perhaps let us in more often, if we ask?
Dr Huppert
It is indeed a problem getting in; my predecessor, David Howarth, tried to get in and was told that it was not possible for him to do that. It is somewhat worrying if there are institutions in this country in a state such that MPs cannot be allowed in to have a look.
Dr Huppert
Indeed; I plan to be persistent. I accept the fact that unexpected circumstances sometimes mean that things must be cancelled. One deferral is fine, but if the arrangement keeps being deferred I shall be more concerned, and shall certainly raise the matter here.
To move on to the issue of children, we heard earlier from the hon. Member for Croydon Central about the effects of detention on mental health; we have heard about its effects on physical health and overall well-being, and about the future that we are providing for the children in question. It is hard to see how any of that fits with the UK Border Agency’s statutory duty under section 55 of the Borders, Citizenship and Immigration Act 2009 and the way in which it is supposed to treat children, or with article 37 of the UN convention on the rights of the child, which states that detention should be used only as a last resort and for the shortest possible time. It would be hard to say that that is being carried out.
Another issue is the advice and help that the children and their parents get. I had planned to speak for longer and to discuss legal aid for Refugee and Migrant Justice, but early-day motion 191 on that topic was discussed on the Floor of the House today, so I shall not take up time with it now; nevertheless, it is essential that we provide the right support to people.
The way in which we deal with age-disputed children is also a real issue. With very young children things are clear for all concerned. They are children, and there is no doubt. They should not be detained. We need to provide much more family-friendly and child-friendly solutions. There is a concern about children who claim to be, say, 17; it is hard to tell whether such a claim is honest. We need a clear, fair process to try to establish the age of those people. In many cases it will not be hard. We need a clear routine that appears fair and does not seem—as in so many cases that I have been made aware of—like arbitrary justice, with decisions being made semi-arbitrarily, based on various factors, about whether the truth is being told. It is hard on teenagers who are already in very difficult circumstances to tell them that there is no way for them to interact sensibly with the process.
The question was raised earlier whether we should punish children for the sins of their parents. I do not see seeking sanctuary in this country as a sin or something worthy of punishment. It is worthy of rapid decisions about whether people are genuine sanctuary seekers, who should be coming to this country—and we should open ourselves as we would hope other countries would, to support people in need—or whether there is something false about the story, in which case things are different. In any event, punishment is not the route. Trying to control the people coming to this country by being as nasty as possible to them while they are here is not worthy of this country. There are other issues that must be dealt with, and international development is clearly the right process for that, as has been mentioned.
The UK Border Agency needs to work faster. I am constantly coming across cases that have taken years to process, and that gives rise to questions about how fairly and rapidly the system works. The aim must be to reach a decision quickly and fairly about whether people are genuine sanctuary seekers, so that if they are not they go, and if they are they can stay. At the moment, it takes far too long. Competence is a serious issue in relation to the UKBA in several wider respects, which have even affected people who came to work for me in my former profession, from such places as the USA. There is something fundamentally wrong, in my experience, with the way the agency operates.
We need to end child detention as quickly as possible. I am delighted that that is in the coalition agreement. It is a fantastic aspect of the coalition that we can finally end such an awful thing. We owe the people of this country better than child detention, and I look forward to our fulfilling our aim in that respect.
Meg Hillier (Hackney South and Shoreditch) (Lab/Co-op)
It is a pleasure to serve under your chairmanship, Mr Weir.
I have some questions for the Minister, and to help him respond fully it may help him if I go through them before I make any other comments, and pick up on hon. Members’ points. As to Dungavel, what, currently, will happen if a family in Scotland are required to leave the country—to be deported? Where are they sent, and how is that dealt with?
The Minister spoke about local authorities, and working more closely with them. I wonder whether the Government are planning to work with all local authorities equally, or whether they will build on the existing model that applies to unaccompanied asylum-seeking children. It is a slightly different model, and involves specialist local authorities that are particularly adept at dealing with these challenging issues.
What discussions has the Minister had with local authorities to make them aware of the situation regarding children liable to be removed, and of how the process will work? I know that it is early days, but I wonder whether he could give some guidance, because I am sure that the Local Government Association and individual authorities will be keen to know how it will work practically.
I am also interested to know how the Government propose to work with community organisations. We hear a lot about the big society. Like many people, I am keen to know what it actually means. I shall touch on some of the work with community organisations that was under way while my party was in government, but I am keen to hear a bit about the Government’s plans. Perhaps, if the Minister is unable to answer here and now, he could provide some information in writing in due course.
This debate is about alternatives to child detention. I have had the opportunity to speak to those who are responsible for the project in Glasgow. I do not know whether the Minister managed that on his visit to Glasgow this week, but I am pleased that he is going around the different nations of the UK to discuss the matter. What progress has there been on the Glasgow project? To date, has any family actually left voluntarily as a result of that very intense intervention, which I believe involves two social workers working with around four families at a time? I wonder whether there has yet been a success story, because, sadly, there had not been one as I left office, but I have great hopes that the project can deliver some results. It is still early days, but I would be keen to hear an update on it.
The Minister mentioned the assisted voluntary returns package but did not absolutely pledge that it will continue, although I did not hear him say that it would not. I would be keen to hear some clarification on the future of the package, particularly in the current financial situation. It is a reasonably generous package of up to £5,000 per individual, and I wonder whether the Government plan to keep it at that level, and whether the Minister has a hotline to the Chief Secretary to the Treasury, who is his right hon. Friend these days, to ensure that that money will be there to enable the alternatives to progress. I welcome the fact that the Minister is cautious about the separation of families, and I shall touch on that in a moment.
An interesting issue in this area is the impact on human trafficking. Clearly, children are trafficked. If they are never detained, there is a risk that that could become a pull factor for those who have mal-intent towards children. In constructing the review and taking account of views, is there any particular oversight of that threat, so that as the review progresses and proposals come forward, it is considered, and there are not perverse outcomes which none of us in the House would want?
On that, would the Minister pledge to monitor the impact on children in what we might call private fostering? As the previous Minister, I was responsible for this area. There were occasions when adults were detained but the children would be elsewhere, and it could take some time to locate the children when the parents and family themselves had decided to separate. That lays open terrible potential risks to children in terms of child protection and safety. Again, if the review is well done and well constructed, the matter could possibly be dealt with, but there is a potential perverse outcome which the Government need to be aware of and plan against.
Has the Minister had any recent legal advice about section 55 of the Borders, Citizenship and Immigration Act 2009 on the duty of care for children, as mentioned by the hon. Member for Cambridge (Dr Huppert), and its impact on the review? There has been previous legal advice, but I wonder whether the Minister is seeking legal advice about the impact of that legislation.
There has been some discussion of the importance of legal advice, with which I certainly agree. I wonder whether any further action has been proposed, either as part of the review or separately, on improving legal advice, which has dogged all of us as constituency Members who deal with casework but also anyone in government who has to deal with these challenges. Does the Minister have any thoughts on that?
The current proposal is to continue some detention, but, according to the coalition agreement—I stand to be corrected if I have misunderstood it—there is an intent to hold a family with children for between 24 and 72 hours only. What would happen in the current situation if a family with children who are already in detention launch a judicial review at the 11th hour? Will the Minister ever continue to detain the family? Does he rule that out, or do the Government not currently have a definite position? I hope that because I have given him notice of questions, he will be able to answer them fully.
We heard some useful contributions from Members. My right hon. Friend the Member for Leicester East (Keith Vaz) has spoken many times on this subject. I should point out that the backlog has been a bugbear for us all as constituency MPs, and for anyone in the House who has any interest in the matter, but it has reduced. As a constituency MP and in my previous role, I have seen that and can testify to it.
I do, however, share a concern with my right hon. Friend about resources. Will progress go backwards now, given that there will be tight controls on and reductions in Government spending? Let us be honest: we are interested in this issue, but many people up and down the country would not see it as a priority. I wonder whether it is a priority of the current Government to make resources available to ensure that the backlog continues to go down, and that there is support for those going through the system so that they can get the right advice.
My right hon. Friend rightly highlighted the fact that the backlog does not help the situation regarding detention. Families who see other families staying for a long time because they have been caught up in the backlog are led to believe that there is not a real prospect of their leaving.
Keith Vaz
I do not want to prejudge my hon. Friend’s memoirs detailing her period in government before they eventually come out, but is it the case that the Home Office did not ask for more resources, or was it just not given more resources? Was there a plea to the Treasury that if there were more resources, more could be done about the issue?
Meg Hillier
I worked with two Home Secretaries who were robust in defending the Home Office’s need for resources for several areas, but, as the Minister will find out in his new role, resources are always challenging in a Department such as the Home Office. There are many priorities, and every time resources are put into one area, there is a risk that another area will bubble up, as I believe he with his greater experience dealing with these matters in Parliament will know.
Resources were always an issue, but it was not as simple as that. Often, local authorities did not want cases decided as quickly as they could have been because of the challenge of then housing and providing for families. There had to be some negotiation so that families who were able to stay were properly provided for in local authorities.
Ms Abbott
Would my hon. Friend agree that delays, which bear on child detention, are part of a process that feeds on itself? The more delays there are, the more people have shoddy legal advisers who tell them, basically, to play for time. If at some point we could bear down on the delays, it would save us money in the medium term.
Meg Hillier
I believe that my hon. Friend would agree that, as constituency MPs, we have seen reductions in the delays. I certainly am seeing that, and the figures that the Government can provide will show that they have reduced. Yes, as she rightly says, there is a self-propelling, negative cycle.
The hon. Member for Croydon Central (Gavin Barwell) raised some questions about the Opposition’s position, and I shall make that clear. Actually, the approach of the Government is very much the approach that was under way as the previous Government left office.
My hon. Friend the Member for Hackney North and Stoke Newington (Ms Abbott) said that she has visited detention centres and seen what goes on there. I, too, have visited them, and that was one reason I was keen, as the Minister then responsible, to have a review and to work with organisations that had an interest in the matter. As I communicated to her and, in particular, to the hon. Member for North East Bedfordshire (Alistair Burt), who is now the Under-Secretary of State for Foreign and Commonwealth Affairs, and who was very interested in the matter, I was frustrated that a great deal of energy was being spent on argument and disagreement, not solutions. Any solution would not have solved the problem overnight. Do Members not think that in the past 13 years the Government would have stopped detention overnight if it were that easy? It is not that easy, and that is the reality of government.
Meg Hillier
Could I make some progress, please? Let us be clear that Yarl’s Wood also houses foreign national prisoners, not just families with children. We should get it into the debate that families with children are not the only people housed there.
I worry that my hon. Friend has forgotten our conversations in which I explained my plans to revisit some of the issues surrounding children in detention. Some work was done by previous Ministers responsible for immigration to improve support for unaccompanied asylum-seeking children, create expert local authorities that were able to deal better with those children, and create a children’s champion within the UK Border Agency.
At the end of last year, my hon. Friend the Member for Oldham East and Saddleworth (Mr Woolas), who in the past had focused more widely on the issue of children in the immigration system, spoke to me about his desire to see a particular ministerial focus on the issue of children in detention. He asked me to take on that responsibility. As I have said, I wanted to look at the whole picture, and I began that process by meeting a number of organisations involved, and the hon. Member for North East Bedfordshire and the former Member for Bedford, because of their particular interest in this matter. Out of that meeting, held under the Chatham House rule—I will not name those who were there, although hon. Members would not be worried about that—we came up with the view that early legal advice was important, and that the early legal advice project already under way needed to be boosted. I subsequently met the Diana, Princess of Wales Memorial Fund and ensured that we worked closely with it, because of its desire to see a difference in that area. That was a helpful partnership and I also worked with local groups.
Ms Abbott
I remember our conversations with great clarity. My hon. Friend is a good friend and colleague, but we took diametrically opposed views on the issue of children in detention. I thought that it was wrong, and I have always thought that. One argument is that there is a problem because this is not an easy matter, but the real Home Office position was revealed in many statements, which claimed that ultimately, children in detention were not the responsibility of the Government but that it was the fault of their parents. Behind that lies a narrative on immigration that suggests that the more punitive the system is made, the less likely people are to abuse it.
Meg Hillier
I disagree with my hon. Friend. Perhaps I could remind her that we both agreed that we should not let the better be the enemy of the good. I was attempting to improve the system, and I am pleased that we are now seeing further steps along those lines. A better take-up of assisted voluntary return was a particular issue, and I pushed hard for third parties to do that. The Government felt that it was not always appropriate if such matters were dealt with by the person who was deciding on the immigration claim, and I hope that that will be a major part of the review. Excess baggage is not a new issue, but it is an equally important one to help people settle back. We need a clearer process in which people know from the beginning what the options are, and work on that with community groups has been important. Removal directions should be provided in the community. Those things are all part of the plan and the intense work that the UK Border Agency was beginning to undertake, prior to the election.
The previous Government were learning from the best models from abroad, and the new Government are continuing with that. However, we must recognise that even those models from abroad—in Australia and Sweden, for example—allow for children to be detained under difficult circumstances. I refer the House to an Adjournment debate from 10 February 2010, in which I flagged up some of those issues, although at that point I had not met a number of the groups.
I wish this approach well, as it is the way in which the previous Government attempted to deal with the situation. However, it was not easy, and I am a little puzzled. Today the Minister reiterates an announcement of the end of children being detained, and he re-announces a welcome review that was already under way. In his opening speech, he clearly highlighted the likelihood of detention immediately prior to a flight. I refer back to my point about what would happen in the case of a late legal challenge; that is an issue that needs to be tackled and supported by the whole legal process. The Minister also mentioned the Afghanistan centre for Afghan teenagers, and I wonder whether that marks a division in the coalition, especially given the remarks made by the hon. Member for Cambridge.
Damian Green
I am grateful for the unanimous support for this policy from all sides of the Chamber.
Damian Green
Absolutely. This is the second time this week that something has happened to me that I suspect will never happen again. I attended the Citizens for Sanctuary summer party where, as the new Minister for Immigration, one expects to get brickbats, but instead I was given a bouquet. I suspect that that will be the last time, so I thought that I would enjoy it while it lasted. This debate is a metaphorical conclusion of that experience.
I am grateful to hon. Members from all parties for their contributions. The only comment that verged on the slightly churlish was the conclusion reached by the hon. Member for Hackney South and Shoreditch (Meg Hillier), who was attempting desperately to find splits in the coalition. I am extremely pleased and proud to be advocating our policy, which was in the Liberal Democrat manifesto. The hon. Lady will toil in vain if she seeks to find splits in that area.
A number of important practical points were raised and questions asked in the debate, and I will now deal with those. First, let me say that I was remiss in not thanking the hon. Member for Hackney South and Shoreditch for all the expertise and personal kindness that she showed when she was in government and I was in opposition.
The right hon. Member for Leicester East (Keith Vaz) rightly mentioned the review by the Home Affairs Committee. As he said, he recognises many of the ideas that the Government have put forward, as many were mentioned in past reviews by that Committee. I look forward to further expert contributions from the Committee. He also went through some of the statistics for children in detention, which I think bear greater examination. He mentioned the figure of just over 1,000 for the number of children in detention in 2009. If that annual figure is broken down, one finds the slightly depressing fact that the numbers go up as we go through the year: the figure for the third quarter is higher than that for the second or first quarters.
As the hon. Member for Hackney South and Shoreditch said, the central difficulty is about what should be done at the end of the process if a family simply refuses to go. Detention under the system that we are getting rid of was not necessarily effective. Of the 1,068 children who departed from detention in 2008-09, only 539 were removed and 629 were released back. There are clearly difficulties with the efficacy of removal and with taking away detention as an option—something that we are doing for all the reasons that have been advanced during the debate—but even with detention, more children were released back into the community than were removed. The old system was not particularly effective, and I am grateful to the right hon. Member for Leicester East for stating the actual figures, as they illustrate that fact tellingly.
Meg Hillier
Will the Minister confirm that those who were taken out of detention were never brought back into detention so as to be removed from the country again, or indeed removed from the country by another route?
Damian Green
I am not entirely sure that I understood that question. Is the hon. Lady saying that those who were eventually removed had never been detained and then released, and then detained again and later removed? Is that what she is saying? The honest answer is that I do not know. I was not the Minister at that time. She was. If she says that that is the case, I am grateful for the information.
Many hon. Members have mentioned Yarl’s Wood and other detention centres. I have visited Yarl’s Wood on several occasions, and in my experience the regime got markedly better over the years. Last time I visited, a functioning school was in operation and so on, and it was a much more humane place than it had been in previous years. I pay tribute to the Ministers who were involved in supervising that, as well as to the staff of the UK Border Agency who made sure that it happened. I suspect that we have all had the same experience. However, even when that place was in its most humane phase, it was still disturbing to see children locked up behind bars. That is one of the things that impels our policy.
There was mention of children at Harmondsworth. I may have misunderstood the right hon. Member for Leicester East, because it is my understanding that there are and were no children held at Harmondsworth. If I have misunderstood, I apologise, but I thought that he had said that there were.
Damian Green
I am grateful for that clarification. The position was not entirely clear.
The point was rightly made about access to local authority services. Local authority social services are embedded at Yarl’s Wood; they are there permanently.
My final point about the statistics is that the figure was more than 1,000 and it is now five, so we are doing our best, even in the interim phase while the review is going on, to keep the numbers to an absolute minimum.
Various Members on both sides of the Chamber brought up the issue of delays, which lead to problems in the system. I think that I was being invited by the right hon. Gentleman to give a new time scale for the end of the legacy. Given all his experience, he will excuse me from making such commitments in my second outing at the Dispatch Box, but he will know, from having sat through many of these debates with me in the past four years, that like him, I have been very exercised by the problem of delay.
I dare say that those who were Ministers in the previous Government would not dissent from the basic proposition that the long delays embedded in the system lead to many of the associated problems that we see. Bearing down on those delays and getting rid of the old legacy, as it has been called, as fast as possible is clearly a high priority. That will have beneficial spin-offs throughout the asylum system and, indeed, the wider immigration system.
At various stages, the debate drifted into a general immigration debate, and it is perfectly reasonable that the same points apply in that context. The fewer delays we have, the more likely we are to avoid the problems that we have seen, although it is a fair point—it was made by Ministers in the previous Government and will be made by me—that not every delay in the system is caused by the system. Not every delay is caused by the border agency. Some delay is caused by the legal processes that people have the right to go through and do go through.
Ms Abbott
On the question of delays, one thing that successive Ministers in the previous Administration never understood is that if we, in a panic—usually occasioned by the tabloid press—bear down on one aspect of the system, all that does is displace pressure to another aspect. That is why we were never successful in dealing with delays overall. We bore down on one thing—Romanian ladies in headscarves—and then got a bulge of children who claimed to be 18 but were not. So I beg, in a non-party political way, for a strategic, all-embracing approach. That in the end will produce the desired result.
Damian Green
I agree with that point and will seek to take the friendly advice that the hon. Lady offers across the Chamber in that regard.
Gavin Barwell
Does the Minister agree that one of the other reasons for delay and one that causes great frustration to UKBA staff is the difficulty of returning people to certain countries? Will he work with colleagues at the Foreign Office to see whether we can secure improved arrangements in that regard?
Damian Green
Absolutely so. The whole Government are working very hard to ensure that those who have no right to remain here are returned to their countries of origin. My hon. Friend, who has huge expertise already in this matter, representing Croydon Central, will have noticed that when the Government and the UK Border Agency have some successes in that regard, it is not universally popular. We are being criticised this week for resuming returns to Iraq, but that has to be part of the process; otherwise, the process will silt up.
Let me make some progress, as I am conscious of the time and there are many questions to answer. A point made by various hon. Members, including my hon. Friend the Member for Croydon Central (Gavin Barwell) and the right hon. Member for Leicester East, was about resources. The right hon. Gentleman will be aware of the state of the public finances left by the Government he supported for 13 years. As a result, there will be difficulties. All I can sensibly say is that the management of resources is as important as the quantum of resources. That is one of the things that the new Government are most eager to get to grips with as fast as possible, and we shall be doing so as part of the general spending review.
Various hon. Members, including the hon. Member for Hackney South and Shoreditch, asked about the Glasgow pilot. She will know that it encourages refused asylum seeker families to return voluntarily by providing intensive support, which is focused on helping families to confront issues that delay a return and building up skills to prepare for a voluntary return. Thirty-two families have been referred to the Glasgow pilot; 11 have been accommodated there. I am afraid that nothing has changed in that regard since the hon. Lady left office. No families have elected to return voluntarily to their home countries, and enforced departure has taken place of three families who were initially accepted into the project. However, she and I need not despair at this point, because one of the things that I learned when I was in Glasgow earlier this week was that the fact of that project has spread awareness of assisted voluntary return much more widely among the various communities—she will be aware that there are large numbers of such families there—which in itself has led to a significant surge in applications for voluntary return. The availability of that process and the information on it is quite heartening in terms of the wider review that I am conducting. The more aware we can make families of the existence of voluntary return, the more they seem to be interested in it. It is a difficult set of options before the Government, but that is one of the heartening points that should be made.
I will attempt to answer all the questions the hon. Lady asked. On Dungavel, in the one or two cases that occur now, the families are moved to Yarl’s Wood, so that is the only place where they are being held. The problem is lessening slightly as I progress through this speech. I have now learned that only three children are in detention at the moment at Yarl’s Wood. She asked, as others did, about local authorities. Clearly, the local authorities with the most expertise, whether we are talking about Croydon, Kent or Hillingdon—the ones that people would expect to be involved—will play a significant role in the review, but I take her point that other local authorities will need to be informed.
The hon. Lady asked about community organisations. One reason for trying to get out as much as possible is to engage not only the national end of the various organisations that are most concerned with either the welfare of children or, specifically, families in the position that we are discussing, but the organisations on the ground around the country, so that they can contribute their considerable expertise to the review.
On assisted voluntary return, the hon. Lady makes the point that we are living in a time of spending stringency. All I can sensibly say at this point is that, as she knows, in the long run nothing is as expensive as detention. Building and maintaining detention centres is more expensive than providing people with packages to return voluntarily, so if all goes well, the net effect on the public purse will also be beneficial.
The hon. Lady asked about the legal advice that I am receiving. All I can say gently is that I do not remember her ever sharing the legal advice that she received from Home Office lawyers when she was standing at the Dispatch Box. That was a very good habit of hers, which I intend to take up.
I am grateful to all hon. Members who contributed to the debate. It has been extremely constructive. This is not necessarily an easy problem to solve, but we all agree that it must be solved. We cannot go on with the system that we had in the past. The final big question was when we shall finish the review. The report will be on my desk in the early weeks of July, and I shall proceed with all possible speed after that to come to a full conclusion.
Question put and agreed to.
Written Ministerial Statements
(13 years, 10 months ago)
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Further Education Colleges and Training Organisations
(13 years, 10 months ago)
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The Minister of State, Department for Business, Innovation and Skills (Mr John Hayes)
I am pleased to inform Parliament that the Government are announcing today a series of measures aimed at boosting economic recovery. These measures will give further education colleges and training organisations greater freedom to deliver the education and training that employers and individuals need, and to raise opportunities for lifelong learning through a system that is freed of unnecessary bureaucracy, and driven by empowered, informed learners.
The main measures are:
All colleges, except those which are performing poorly, to be given new freedoms to move money between budgets. This will allow them to respond quickly to local demand.
Working to bring colleges into line with schools in respect of Ofsted inspection, so that colleges which achieve outstanding results do not face inspection unless their performance drops.
Refocusing £150 million of resources to expand the number of apprenticeships available; and £50 million to support FE capital development;
Giving learners the information they need to drive the system, through the publication of clear and consistent information about performance, quality and standards.
I will be writing today to all colleges and training organisations about these and other changes, which will help them to focus on meeting the demands of employers and learners in their areas.
The Secretary of State for Business, Innovation and Skills will also be writing to the chief executive of the Skills Funding Agency—the body responsible for funding colleges and training organisations—confirming his priorities for the adult education and skills budget in 2010-11, including the refocusing of £150 million to pay for 50,000 extra apprenticeship places this year, and £50 million for new capital grants to colleges. A key goal will be to strengthen the supply of qualifications that are valued by employers; and to secure high-quality training opportunities to help unemployed people get the skills they need for work-readiness and sustainable employment; as well as encouraging an increasing number of people to participate in adult and community learning, both to re-engage those disenchanted by previous educational experience and to offer people opportunities to enrich their lives through learning.
Underpinning these changes, we are seeking to empower learners so that they can drive the learning and skills delivered by colleges and training organisations. A professional and impartial advice and guidance service will be available to support learners. Publication of clear information about the performance of colleges and training organisations will allow learners and employers to make well-informed choices. This will include information about learner success rates, learner and employer satisfaction, and the destinations of those who leave learning. As a result of the freedoms that we are announcing today, colleges and training organisations will be able to respond quickly and flexibly to their choices, offering a wide range of programmes that drive both high-tech innovation and new enterprise and support adult recreational learning.
Over the coming months, the Government will be looking at a wide range of other ways to remove unnecessary bureaucracy from the system, and we will be making further announcements in due course.
Houses in Multiple Occupation
(13 years, 10 months ago)
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The Minister for Housing (Grant Shapps)
Today I am announcing the Government’s intention to amend the planning rules for houses in multiple occupation (HMOs) which were introduced on 6 April 2010.
I understand the concerns of local people who see their neighbourhoods being damaged by undue concentrations of HMOs and the significant impact this is having on their quality of life. However there are also many areas where HMOs are not causing problems and indeed provide an important supply of low cost housing. I believe that the planning system needs to take account of both these differing circumstances and allow for local solutions rather than continue with the present “one size fits all” approach.
The current rules impose a blanket requirement for planning permission in order to change use from a domestic house to a HMO. When introduced, it was estimated that these rules could result in an additional 8,500 planning applications per year and could lead to a reduction in supply. This goes against the recommendations in successive reports on the planning system that Government should reduce the number of planning applications for minor development. It also runs the risk of losing low cost housing in areas where it is needed most.
I believe that we need to move away from this kind of centralised, regulatory approach which has dominated planning in recent years and create a system which encourages local people to take responsibility for shaping their communities. Decisions should reflect local priorities expressed through the local plan, rather than nationally imposed rules.
I therefore intend to amend the HMO rules to allow changes of use between family houses and small, shared houses to take place freely without the need for planning applications. However, in those areas experiencing problems with uncontrolled HMO development, local authorities will be able to use their existing direction-making powers to restrict this freedom of movement by requiring planning applications. This change will allow the free development of smaller shared housing, which is a vital component of our private rented sector, unless there is a serious threat to the area.
My officials will work through the detail of the proposed changes with interested partners to ensure that the new rules work for local people without placing an unnecessary burden on businesses.
My aim is to have the revised arrangements in place by 1 October 2010.
Defence Vetting Agency: Key Targets Financial Year 2010-11
(13 years, 10 months ago)
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The Parliamentary Under-Secretary of State for Defence (Mr Andrew Robathan)
Key targets have been set for the chief executive of the Defence Vetting Agency for financial year 2010-11 to deliver national security vetting to defence customers. Delivery of vetting to its repayment customers will be to similar standards as set out in their joint business agreements.
Key target 1: External validation of quality of defence vetting cases
To achieve at least a 98% satisfaction rating with 200 cases independently selected and reviewed from a random sample of security check (SC) and developed vetting (DV) cases completed in the preceding 12-month period.
Key target 2: Delivering excellent customer service
To maintain customer service excellence accreditation.
Key target 3: Completing routine cases for defence customers
a. 85% of counter terrorist checks (CTC) within 30 calendar days.
b. 85% of SCs within 30 calendar days.
c. 85% of DVs within 100 calendar days.
Key target 4: Completing priority cases for defence customers
a. 95% of CTC/SCs within 10 calendar days.
b. 95% of DVs within 30 calendar days.
Key target 5: Completing aftercare cases for defence customers by
a. Taking into action all aftercare incident reports within seven calendar days of receipt.
b. Taking into action 95% of scheduled aftercare within 30 calendar days of the scheduled date of review.
c. Taking into action (where appropriate) 95% of security appraisal reviews within 21 days of receipt.
The timeliness key targets represent net performance that exclude delays outside of DVA control.
Key Target 6: Delivery of the Cerberus project in line with planning tolerances.
a. Manage third party suppliers to provide their side of the Cerberus interfaces by September 2010.
b. Achieve an operational capability for e-forms and case management system by December 2010.
c. Achieve roll-out in line with plan to vetting customers by March 2011.
EU Environment Council
(13 years, 10 months ago)
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The Secretary of State for Energy and Climate Change (Chris Huhne)
I represented the UK at the Environment Council in Luxembourg on 11 June, together with Lord Henley, Parliamentary Under-Secretary for Environment, Food and Rural Affairs. Stewart Stevenson, Minister for Transport, Infrastructure and Climate Change in the Scottish Government, also attended.
The presidency presented progress reports on the proposal for a regulation on biocidal products, the restriction of hazardous substances (RoHS) directive and the waste electrical and electronic equipment (WEEE) directive.
The Council agreed conclusions on forest protection, and water scarcity and drought. A number of member states intervened to stress the importance of adequately preparing forests for climate change, and the presidency highlighted the need to reconcile increasing water scarcity with rising demand. Ministers also agreed conclusions setting out the EU position for the forthcoming meeting of the parties to the Cartagena Protocol on Biosafety in October, and conclusions in support of the “Rio+20” UN conference on sustainable development. Lord Henley stressed the importance of concrete outputs from the conference which recognised the need for sustainability, the importance of ecosystems services and international governance in line with future climate change arrangements.
Under any other business, the UK and Germany raised the forthcoming meeting of the International Whaling Convention (IWC). Lord Henley emphasised the importance of IWC reform to ensure conservation of whales, and stressed the need for the EU to show leadership and consistency in opposing commercial whaling. The French raised an AOB item pushing for a moratorium on the authorisation of genetically modified organisms; the UK welcomed the progress made by the Commission and stressed the importance of ensuring proportionate and efficient regulation, but argued against a moratorium.
The lunchtime discussion focused on international climate change. The presidency gave a presentation on the outreach activities undertaken by the presidency and the Commission during the past six months.
The Commission presented their communication analysing the options to move beyond 20% greenhouse gas emission reductions and assessing the risk of carbon leakage. In the policy debate that followed, member states welcomed the communication as providing a solid evidence base for further discussions on this issue. I intervened to underline the key message of the communication that the costs of moving to a 30% target are significant but manageable, and that they have reduced since 2008. I expressed my hope that the EU would show leadership by increasing our target to 30%, and insisted that unless we do so it is very hard to imagine that we will be able to remain on the trajectory of keeping global temperature increase to within 2°C. While a number of other member states’ interventions supported these arguments, others highlighted the reduced capacity in the European economy for the investment which would be required to meet a higher target. The Council agreed conclusions on the communication which noted the need to return to the issues no later than October 2010 and welcomed the Commission’s intention to conduct more detailed analysis.
Lastly, the presidency presented a progress report on the proposed regulation on reducing CO2 emissions from light commercial vehicles (i.e. vans), which was noted by the Council.
Veterinary Medicines Directorate and Veterinary Laboratories Agency
(13 years, 10 months ago)
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The Minister of State, Department for Environment, Food and Rural Affairs (Mr James Paice)
The 2009-10 annual report and accounts for each of the following was laid before Parliament today:
Veterinary Laboratories Agency
Veterinary Medicines Directorate
NHS South West
(13 years, 10 months ago)
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The Secretary of State for Health (Mr Andrew Lansley)
I have asked Sir David Nicholson, chief executive of the NHS in England, to initiate a review into the approach and behaviour of the NHS South West in relation to Royal Cornwall Hospitals Trust, in particular, to the dismissal of John Watkinson and, by association, the trust’s position in relation to the provision of upper gastro-intestinal (GI) services in Cornwall.
John Watkinson was dismissed from his role as chief executive of the Royal Cornwall NHS Trust in April 2009. He took his case to employment tribunal, which has recently published its judgment that he was unfairly dismissed.
In the opinion of the employment tribunal, John Watkinson was unfairly dismissed because he made a “protected disclosure” covered by the Public Interest Disclosure Act. The disclosure was linked to the reconfiguration of upper GI services in Cornwall. The employment tribunal also found that Royal Cornwall NHS Trust acted as it did as a result of pressure from the South West Strategic Health Authority (NHS South West).
Verita, a specialist company that conducts independent investigations, reviews and inquiries has been commissioned to undertake this review.
The Terms of Reference for this review will be;
to examine all the SHA’s interactions with the Royal Cornwall Hospitals NHS Trust in relation to the dismissal of John Watkinson and, by association, the trust’s position in relation to the provision of the upper GI services in Cornwall. In particular, to determine:
the chronology of events and decisions made in the running up to the dismissal of John Watkinson;
what involvement NHS South West had in his dismissal and whether or not this was motivated by the reconfiguration of upper GI services or otherwise; and
whether the SHA acted appropriately, proportionately, in keeping with its role and within its statutory responsibilities.
The review should not duplicate the review of the upper GI service configuration which was recently carried out by the independent reconfiguration panel, nor any subsequent appeal of the employment tribunal’s decision. However, it may consider these and any other relevant background evidence to make its determinations.
The findings of the review will be published later this year and I will update the House on the outcome of the review and my response.
Rail Franchising
(13 years, 10 months ago)
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The Minister of State, Department for Transport (Mrs Theresa Villiers)
The Department for Transport will shortly begin a consultation exercise on the future of rail franchising policy. This consultation will provide industry partners with the opportunity to comment on the Government’s approach to rail franchising and whether bidders for longer franchises would be able to offer investment in improvements to trains and services. It will also allow the industry to set out its proposals for improving the efficiency and value for money of rail franchises, for both taxpayers and fare payers. I will set out further details to the House in due course.
To enable the next Greater Anglia and Essex Thameside franchises—which are currently in the process of being re-let—fully to reflect the changes resulting from this review of policy the competitions for these franchises, which were started in January 2010, are to be cancelled.
It is currently expected that a new competition for the Greater Anglia franchise will be advertised by the end of the year, after the consultation responses have been considered, with the Essex Thameside franchise following in autumn 2011.
It is also expected that there will be some consequent changes to the procurement time scales previously published for the InterCity East Coast franchise. Rail services will continue to run as normal on all affected franchises. A prior information notice (PIN) setting out the Department’s proposed future rail franchising programme will be issued in due course.
House of Lords
Message from the Queen
Earl Peel
My Lords, I have the honour to present to your Lordships a message from Her Majesty the Queen, signed by her own hand. The message is as follows:
“I have received with great satisfaction the dutiful and loyal expression of your thanks for the speech with which I opened the present Session of Parliament”.
National Assembly for Wales: Referendum
(13 years, 10 months ago)
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Lord Livsey of Talgarth
To ask Her Majesty’s Government whether the referendum mentioned in the Queen’s Speech for the National Assembly for Wales to have primary legislative powers will be put to the people of Wales in October 2010.
The Advocate-General for Scotland (Lord Wallace of Tankerness)
My Lords, I refer my noble friend to the Written Ministerial Statement made under my name on 15 June 2010. In that, I repeated a Written Ministerial Statement by my right honourable friend the Secretary of State for Wales in which she indicated that it had not been possible to lay a draft referendum order before Parliament by today. She further stated that our aim is for a referendum to take place before the end of the first quarter of next year.
Lord Livsey of Talgarth
My Lords, my noble and learned friend has made that statement on behalf of the Secretary of State. I am not entirely satisfied that we cannot have an October referendum, which was our wish, but I am glad to know that it will be in the first quarter of 2011. My noble and learned friend may be familiar with Edmund Burke’s famous remark that there is a point beyond which forbearance ends and tolerance ceases to be a virtue. While Liberal Democrats and devolutionists in all parties in Wales are reaching that point, we need an early referendum for primary legislative powers for the National Assembly for Wales. We face a constitutional obstacle course in Wales.
Lord Livsey of Talgarth
This is the question. Will my noble and learned friend ensure that there is a referendum poll well before next year’s Welsh Assembly elections in May?
Lord Wallace of Tankerness
My Lords, I know from the time that my noble friend and I spent together in the other place that he is a very determined and doughty campaigner both in establishing the National Assembly for Wales and, since then, in enhancing its powers. I make it clear that I am well aware of the importance that the Secretary of State for Wales attaches to this referendum taking place, implementing the coalition agreement. In her letter to the First Minister, she indicated that the date that the First Minister had indicated before the general election should not be considered until after the general election. That has meant that the consultation work on the question has only now begun and that there will be a further reference to the Electoral Commission for it to research and approve the question. Orders will have to be debated and approved in the Welsh National Assembly and both Houses of Parliament and submitted for approval by Her Majesty in Council. Thereafter, the Electoral Commission has indicated that the statutory period of 10 weeks is the minimum that it believes necessary to allow for all the processes required leading up to polling day. With the best will in the world, it was not possible to do that by October, but we have made the commitment that we wish that to happen by the end of the first quarter of next year.
Lord Morris of Aberavon
My Lords, the Conservative Party in Wales has a long record of opposing any Welsh constitutional advance, whether it be the setting up of the Welsh Office or a devolved Assembly. Has it now abandoned this posture and will it now campaign wholeheartedly for more powers for the Welsh Assembly? If it has not, how do the coalition Government reconcile that stance with the Answer in the other place by the Minister for constitutional reform, Mr Clegg,
“Yes, the Government do support a yes vote”.—[Official Report, Commons, 7/6/10; col. 41.]
in the referendum?
Lord Wallace of Tankerness
I am grateful to the noble and learned Lord for giving me the opportunity to make it clear that my right honourable friend the Deputy Prime Minister subsequently made it clear to the House of Commons that that was not the position. The Government will not have a particular view on the outcome of the referendum. Our coalition commitment is to ensure that the referendum takes place. The referendum is not the plaything of any one political party. It is for the people of Wales to decide and we will respect their decision.
Lord Elystan-Morgan
In so far as the people of Wales are concerned, does the noble and learned Lord accept that there is a deep conviction and desire in Wales for a referendum, and for that to be carried, making Part 4 a new constitution for the Welsh people?
Lord Wallace of Tankerness
I note that when the National Assembly for Wales voted on whether there should be a referendum under the Government of Wales Act, the vote was 53 to zero. I am sure that people on both sides of the argument were voting because they want a referendum, but it is not for me at this Dispatch Box to say what the outcome should be. I have no doubt that my noble friends and my friends in the Liberal Democrats in Wales will want me to take a particular view when I am campaigning, but, as I have indicated, the Government’s view is that we want the referendum to take place and the preparation for it to be as thorough as possible.
Lord Morgan
My Lords, will the Minister acknowledge that the lack of urgency in his Answer is deeply disappointing to many of us? Peter Hain, the previous Secretary of State for Wales, endorsed a referendum in the autumn. It has been endorsed by every political party in Wales and the Jones Parry report made an unanswerable case for it. Why are the Government dragging their feet? Is this yet another fault line in the so-called coalition?
Lord Wallace of Tankerness
I wholly reject any allegation that the Government are dragging their feet. I quote from the letter from my right honourable friend the Secretary of State for Wales to the First Minister:
“Your decision that the date and question should not be considered until after the General Election has meant that we have not yet submitted a question to the Electoral Commission, which has confirmed that it will need at least 10 weeks to carry out its assessment and then report”.
I hope that I indicated earlier to your Lordships’ House that the timeline is an extensive one. We want to ensure that this happens properly, and we do not want to take any risk that by taking short cuts we could open ourselves up to legal challenge. I believe that we are taking the proper steps in the right order.
Lord Crickhowell
My Lords, as one who, during the debate on the Government of Wales Bill, said that he would vote in favour of the move proposed in the referendum, I ask my noble and learned friend whether he thinks extraordinary the suggestion that the right honourable Peter Hain should be pressing us when in a major constitutional speech at Cardiff University last October he said that he did not think that the matter should be brought forward quickly—certainly not before 2011.
Lord Wallace of Tankerness
My Lords, having taken office I am discovering that there are many things that I am responsible for, but one of them is not to answer for Mr Peter Hain, thank goodness. I can assure the House that the Secretary of State attaches a huge priority to this. We are taking the steps as quickly as we can, and that is consistent with good governance.
Lord Richard
My Lords, one of the great problems that I have always had in my political life is my nasty, suspicious mind, particularly when it comes to assurances given six months in advance. Can we take it as genuinely firm that, unless there is a catastrophe, this referendum will be held in the first quarter of next year, with no “ifs” and no “buts”?
Lord Wallace of Tankerness
The noble Lord can take it as being as firm an assurance as any Minister could possibly give. There are ongoing discussions. It has been discussed by the Secretary of State with the Welsh First Minister and Deputy First Minister. There is co-operation between the respective Administrations that that should happen. I should add that the One Wales agreement of the coalition agreement in the National Assembly for Wales seeks a referendum before next year’s elections. As part of the respect agenda, we would try to honour that commitment.
First Aid
(13 years, 10 months ago)
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Lord Harrison
To ask Her Majesty’s Government what is their response to the St John Ambulance campaign, entitled “The Difference”, promoting better public understanding and practice of first aid.
The Parliamentary Under-Secretary of State, Department of Health (Earl Howe)
My Lords, the Government admire the work undertaken by health organisations such as St John Ambulance and the Red Cross, and warmly welcome the contribution that “The Difference” can make to the treatment of the ill and injured.
Lord Harrison
Given that the St John Ambulance report suggests that some 150,000 lives could be saved if there was a rudimentary understanding of first aid, and given the paucity of understanding in this country—where only seven out of 100 of us have such knowledge, compared to four out of five of our German colleagues—will the Government redouble their efforts and consider including first aid in the PSHE part of the national curriculum? Will the Minister also study the work being done in the north-west, in a crucial project in Greater Manchester, where ambulancemen and paramedics teach primary schoolchildren about the work of providing and administering first aid? That has gone down very well indeed.
Earl Howe
My Lords, the noble Lord asks several questions there. As I have indicated, we are extremely grateful to organisations such as St John Ambulance, the Red Cross and the British Heart Foundation for the extensive and excellent work that they do. As a general approach, we are clear that the NHS locally is best placed to assess and address what is needed in its areas, as indeed in other areas of healthcare. However, we encourage NHS providers to consider the kind of partnerships that work so well.
As regards schools and PSHE, as the noble Lord will know, first aid is included in the PSHE part of the school curriculum. It is not a mandatory module, though it is often included in key stages 3 and 4. What I can do is convey the noble Lord’s concerns to my colleagues in the Department for Education.
Baroness Gardner of Parkes
My Lords, can the Minister assure me that emphasis will still be placed on the continuing need to educate the public about when to call an ambulance? I strongly support making people more aware of first aid, but there are many conditions, such as strokes, which it is too late to treat unless it is done within a certain timeframe. The ambulance service, as I learnt when I had a fall recently, is very good when you call at sorting out exactly what your symptoms are and whether you need an ambulance. Will the Government ensure that the public remain aware of that situation?
Earl Howe
My Lords, my noble friend is absolutely right. The kind of basic first aid provided by community first responders, as they are called, is extremely important, not least in terms of operating defibrillators. However, that sort of service should be seen as complementary to and supportive of ambulance responses to emergencies. It is not a substitute for emergency ambulance response, and it is right that my noble friend should raise that distinction.
Baroness Emerton
I declare an interest as a former chief commander of St John. I am in touch with the recent campaign. It is interesting to note that there were 250,000 responses to an advertisement from people showing an interest in first aid, of which 70,000 indicated a desire to learn more about it. As part of this campaign, St John has decided that it needs to concentrate—the noble Lord, Lord Harrison, has already mentioned this—on young people and the workplace. An interesting statistic is that 45 per cent of incidents where resuscitation is required occur in offices rather than on building sites. Will the Minister assist St John and the many other agencies by supporting their call to improve workplace facilities for first aid to take place?
Earl Howe
My Lords, the noble Baroness makes an important point. We all know that St John is active in major emergencies and road accidents and was active in the London bombings of five years ago. She is absolutely right that accidents in the workplace are a significant feature of the kinds of injuries that hospitals see. The ambulance service extends training in the workplace in a number of areas. However, I shall go back to the department and inquire about the extent to which St John in particular is doing this work. We may be able to feed in some important messages.
Baroness Massey of Darwen
Given the original Question, and the fact that we are in a workplace, has the noble Earl thought of enabling short first aid courses to be held in your Lordships’ House—I do not mean in the Chamber—so that we could respond in an emergency?
The Lord Bishop of Chester
My Lords, the noble Baroness has asked my question. However, I wonder whether mouth-to-mouth resuscitation might be excluded from such a course?
Baroness Masham of Ilton
My Lords, is the Minister aware that the St John’s guide on first aid and the five basics is free and can be carried round in somebody’s pocket? Should not all restaurants have it because people can choke very easily?
Earl Howe
My Lords, I was aware that the St John guide is free. I take this opportunity to congratulate it on the way in which it distributes so much free material in this area. The noble Baroness raises a concern about the incidence of choking in restaurants. I am not aware of the extent to which restaurants as a whole are equipped to deal with that, but I will find out.
Loan Companies: Interest Rates
Baroness Scott of Needham Market
To ask Her Majesty’s Government whether they plan to regulate loan companies charging high rates of interest.
The Parliamentary Under-Secretary of State, Department for Business, Innovation and Skills (Baroness Wilcox)
My Lords, my noble friend’s Question is timely as the Office of Fair Trading has just released the findings from its review of the high-cost credit sector. Many noble Lords will be aware that I am a long-standing campaigner for consumer rights in this area, and I see this review as an opportunity for Government to reflect on these very high rates of interest and consider whether there is a better way for us to approach this market.
Baroness Scott of Needham Market
Is my noble friend aware of the growing number of companies, some of which advertise on television, which offer short-term loans at extremely high rates of interest—in one case the APR is 2,689 per cent—plus an arrangement fee? Does she share my concern that a small short-term loan could very quickly turn into a very large lifetime millstone?
Baroness Wilcox
My Lords, many of us have seen on television these advertisements by payday loan and instant loan companies offering loans at what seem to be huge rates of interest, running into thousands of per cent. This is a complicated market. The APRs may not be the most suitable method for measuring the cost of these products. For example, borrowing £100 for five days from a company attracts an APR of 3,253 per cent, as the noble Baroness said. That sounds an enormous amount, but in fact the borrower will pay a total of £111—just £11 for borrowing £100—which is less alarming than the APR might suggest. However, that said, we are always looking for ways to try to make credit and lending available to people at all levels in our society. I know that the previous Government and the Government before them struggled with whether to cap lending or let it run free. It has always been the policy of the previous Government, the Conservative Government before them and consumer groups that at least if people have access to some form of credit, they are not being forced on to the black market and loan sharks.
Lord Sugar
My Lords, does the noble Baroness agree that this type of advertising for these loans is rather misleading and that the Government should step in to regulate the content of the adverts, insisting that a significant proportion of them—on TV and in newspapers—is allocated to spelling out what consumers are letting themselves in for? I pre-empt the noble Baroness’s answer by saying that this is not a matter for the Advertising Standards Authority or the trading standards people. Can we also consider a 30-day cooling-off period when the consumer can change their mind at no penalty to them?
Baroness Wilcox
My Lords, I thank the noble Lord for that question and for actually giving part of the answer. The line to take on this is that advertisements for high-cost credit, such as those for instant loans, should carry a wealth warning. We are looking at that interesting idea. The Office of Fair Trading has just made a report which we will be looking at to find a way forward on all of this. This issue affects all of us and it does not matter which side of this House we are on. We all understand the idea that people have to have access to some form of lending and credit, but I can quite understand that seeing these advertisements on the television has upset an awful lot of people, who think that it sounds far too easy. We are and will be looking at ways to see if we can make clearer the information that the general public get, in a language that they can understand.
Lord Martin of Springburn
My Lords, can I receive an assurance that every help and assistance will given to community-based credit unions which do excellent jobs and give people in the poorest areas an opportunity to have a say in the running of their own financial affairs?
Baroness Wilcox
I am delighted to hear someone mention credit unions. They are a wonderful idea. When I chaired the National Consumer Council, we did our very best to get people interested in credit unions. They work extremely well in Germany and Canada, but for some reason they have never taken off as well in this country as we would like. It is a very simple form of people coming together, putting the money together and getting a loan when they need it. We will try again to see if we can market this idea better. It is a wonderful way and we do so hope that we can manage to bring this forward. I know that the previous Government tried as well.
The Lord Bishop of Ripon and Leeds
My Lords, will the Minister comment on the Chief Medical Officer’s recent comments that financial exclusion, which is encouraged by high interest rates, is a major cause of ill health? What plans have the Government to increase the incomes of the poorest so that fewer visits are made to the doctor?
Baroness Wilcox
My Lords, I thank the right reverend Prelate for that question. How shall I answer it? First and foremost, it is important that all people have access to the help that they need, with information that allows them to make a good, informed decision. Getting into serious debt is a worry for all of us and can affect people’s health. We must, wherever we can, encourage people to save and to move away from debt as much as possible. However, when people do get into debt, short-term loans, in particular, can be a help rather than a hindrance so long as they are well described.
Baroness Oppenheim-Barnes
My Lords, is my noble friend aware that since the very first Consumer Credit Act—I think that there have been two or three versions in my time—I have campaigned against the formula which is represented by the APR, as it is totally incomprehensible and does not fully warn what the debt situation is? Does she agree with me?
Baroness Wilcox
The noble Baroness was chairman of the National Consumer Council before I was. She was also the consumer Minister and speaks with an amazing amount of authority on this subject. There is no way that I would go against anything that she says and I am absolutely sure that she is right.
Foxes
(13 years, 10 months ago)
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Baroness Sharples
To ask Her Majesty’s Government what action they propose to take to control urban foxes.
The Parliamentary Under-Secretary of State, Department for Environment, Food and Rural Affairs (Lord Henley)
My Lords, recent events in London have heightened public concern about urban foxes and our sympathies go out to the Koupparis family. Local authorities have powers to control urban foxes and are best placed to decide how and when to apply those powers.
Baroness Sharples
I thank my noble friend for that reply. On my way from the Underground the other day, I saw a fox running into the Commons—it did not come here. Does my noble friend accept that common sense should prevail at this time? A fox is a predator and a wild animal, so people should not feed it. A number of people do feed foxes but perhaps if they stopped doing so the vixen would not have so many cubs to rear. Does my noble friend agree?
Lord Henley
My Lords, I am sure that foxes going into another place are a matter for another place. It might be that they are less keen on coming into this House. As regards my noble friend’s question about food, she is absolutely correct: if less food were left around, we would have less of a problem with urban foxes.
Lord Lea of Crondall
Will the Minister take into consideration a recent event in Crondall when we had a power cut? It was established that it was due to a short-circuit caused by a fox. The consequence was, of course, the demise of the fox. Could this idea not be developed, saving electricity at the same time?
Lord Henley
My Lords, I was not aware of the incident to which the noble Lord refers. I certainly think that it could be built on and I am sure that all local authorities will study with great care what the noble Lord has had to say.
Baroness Deech
Does the Minister agree that food waste is a problem? Will he give a message to local authorities that their rather chaotic plans for keeping food waste separate and for longer than necessary will contribute to the problem of urban foxes?
Lord Henley
The noble Baroness is absolutely correct to say that food waste is a problem. However, I do not believe that we should give a message to local authorities that they should not insist on separating food waste; it is for the local authorities themselves to decide on the best way of disposing of and collecting their waste of one sort or another. If food waste is put in secure bins, there is no reason why it should create a problem.
Lord Greaves
My Lords, I congratulate the Minister on his clear statement that pest control is a matter for local authorities. It is not the job of Secretaries of State and other Ministers to solve every local problem in the country. However, does he agree that this question needs to be kept in perspective in view of the fact that two years ago more than 5,000 people were treated in hospital for injuries caused by domestic dogs and, of those, 1,250 were children? Perhaps that is a bigger problem than foxes.
Lord Henley
My Lords, I am grateful to my noble friend for his support for our localist agenda, which we believe is very important. He is correct to put these matters in perspective, although, obviously, if you have had two children bitten by a fox, you tend to take the matter seriously.
Baroness Quin
My Lords, I, too, congratulate the Minister on his appointment and I wish him well with his new responsibilities. The Opposition recognise that what happened was a terrible event for the family concerned and we send our good wishes to the children for a full and speedy recovery. As the Minister is, according to the Defra website, responsible for relations with local government, is he planning to have any contact with the local authorities affected by this issue? At the moment, there appears to be no information on the Defra website about this, so can he ensure that advice, information and expertise from within his department will be available to those who want it?
Lord Henley
My Lords, I thank the noble Baroness for her kind words and I welcome her to her new role on the Front Bench. We shall talk to local authorities, but I repeat that we believe that these matters are best left to them, rather than being dealt with by direction from the centre. Advice on how to deal with foxes is available from Natural England. I can also assure her that we have commissioned research from the Food and Environment Research Agency into what I gather is referred to as immunocontraception. Currently, that is being trialled on wild boars, but it could have relevance for the control of other mammals.
Lord Marlesford
My Lords, is it legal to release urban foxes in rural areas? If it is, will the Government consider making it illegal?
Lord Henley
My Lords, my understanding is that it could be illegal to do so under the Animal Welfare Act 2006 if it were to cause distress to the fox, which I imagine it would. Obviously, it would depend on the individual circumstances of any capture and release.
Lord Geddes
My Lords, would my noble friend consider whether a repeal of the Hunting Act would assist in this context?
Lord Henley
My Lords, I was wondering when that question would come up. I have a feeling that the repeal of the Hunting Act would not make much difference in relation to urban foxes in Hackney.
Lord Brooke of Sutton Mandeville
My Lords, although I appreciate that urban foxes do not live as long as rural foxes, does the Minister know the proportion of urban foxes to the fox population at large?
Lord Henley
My Lords, some research has been done into fox numbers. It is believed that there are of the order of a quarter of a million foxes in the country and that in the region of 15 per cent are urban foxes, although those are estimates. If we brought in some form of immunocontraception, those numbers could drop further.
Lord Brookman
My Lords, will the Minister put the noble Baronesses, Lady Sharples and Lady Trumpington, in charge of this issue?
Business of the House
(13 years, 10 months ago)
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Lord Strathclyde
That the debates on the motions in the names of Lord Sugar and Lord Corbett of Castle Vale set down for today shall each be limited to two and a half hours.
Arrangement of Business
Baroness Anelay of St Johns
My Lords, immediately after the conclusion of the debate in the name of the noble Lord, Lord Sugar, my noble friend Lord Sassoon will repeat two Statements, the first entitled “Public Spending: Reviewing Commitments made since January 2010”, to be followed immediately by a Statement on banking reform.
Small and Medium-sized Enterprises: Government Policy
Lord Sugar
To call attention to the effect of the Government’s policies, such as proposals for capital gains tax, on entrepreneurship and on small and medium-sized enterprises; and to move for Papers.
Lord Sugar
My Lords, with the proposed first Budget of the coalition Government scheduled to be announced on 22 June, I feel it appropriate that in today's debate matters of change which may affect SMEs should be aired. Before I express my comments, I state that, pursuant to the Code of Conduct, I have registered with the Table Office any relevant interests that may arise from those listed in my name in the House register of interests.
After the formation of the new Government, I was surprised to hear rumours suggesting an increase in the rate of capital gains tax. I thought that such a suggestion would be totally alien to Tory policy. Your Lordships may agree when I say that there have been some rumblings of discontent in their ranks on this matter, but I quickly recognised that it was the brainchild of the new Business Secretary—no doubt part of the prenuptial agreement.
I then noticed some backpedalling on the proposal. The Prime Minister, closely followed by the Chancellor, said words to the effect of, “Don’t panic. Just wait and see”. This gave me hope that our debate today may still be in time to influence what I detect is a plan still being drafted, but I am a bit confused, because the Business Secretary said that the current policy on capital gains tax can lead to large-scale tax avoidance. That was endorsed yesterday by the Prime Minister, while discussing capital gains tax on the Jeremy Vine programme on Radio 2. In that discussion, he said that he did not come into politics to put punitive rates of taxation on savers and people who do the right thing. He concluded: “I think you’ll see that it’s a fair and reasonable outcome”.
I have researched possible schemes of avoidance. Excuse me if I am missing the point when I say that I have come across only one anomaly. It benefits individuals who manage private equity funds who somehow magically turn their commissions made by creating gains for their clients from normal income into a capital gain. I agree that that, like any other tax-dodging scheme, is wrong, but it would be simple to eliminate in isolation in the forthcoming Budget. While we are at it, can we take a look at other stupid anomalies, such as with spread betting, where it seems that trading in shares in one's own name is likened to placing a bet on the favourite in the three o'clock at Newmarket. Just like a win on the horses, those gains are tax free.
Having said all that, I do not agree that an increase across the board on capital gains tax under the guise of stopping those kind of things is fair to genuine traders and businesspeople. It will have a devastating effect on enterprising people who decide to take the leap and set up their own businesses with a view of either floating them or selling them by way of a trade sale. I know that there is currently a £2 million entrepreneur relief in place, but in this day and age that amount falls short of the aspirations of real growth companies, especially those in the technology sector. That big payout is the ultimate goal for such entrepreneurs and their loyal employees. Raising capital gains tax rates will not encourage employees of public or private companies who have been incentivised with approved share option schemes. It will depress their desire to work hard. Most devastated will be those business or asset owners who have worked honestly and hard all their lives and are reaching an age where they are considering a sale.
By all means curtail people who trade in and think up avoidance ideas, but leave the genuine people alone and allow them to prosper and generate employment by good old-fashioned trading, manufacturing and sheer hard work—or, as the Prime Minister put it yesterday, “those that do the right thing”. A taper relief system should exist, resulting in low rates, such as the 18 per cent we enjoy today. There should be a much clearer differentiation between business and non-business assets, to allow people to know exactly where they stand. It is wrong to suppress enterprise in any way. Those people who, outside of their normal work, invest in real estate in their own name to enhance or refurbish it with a view of making gains should not be punished if they have retained the asset for a fair period. The same could be said for those who are long-term shareholders. One needs clearly to differentiate between the fast-buck merchants and those who invest sensibly.
Your Lordships may be interested to note that from the tax year 1997-98 right up to 2007, when the rate was 40 per cent, with taper relief providing possible rates of 10 per cent for business and 24 per cent for non-business, an average revenue of £3 billion per year was collected. In 2007-08, when taper relief was abolished and the advantage of the 10 per cent rate was changed to a flat 18 per cent rate, there was a rush in the sale of assets resulting in a massive increase of receipts to £7.6 billion. From what I hear, it is estimated in that 2008-09, under the 18 per cent arrangement, receipts dropped back to £3 billion. I would hate to think that a significant increase in capital gains tax, albeit delayed until next April, would induce a fire sale of assets that would depress certain market sectors. Is it the Government’s real agenda to generate a massive windfall of revenue in order to boast in a year or so’s time about how well they are doing in reducing the current deficit? The Prime Minister said yesterday that revenues from additional capital gains tax will be used to supplement lifting the income tax threshold for basic-rate taxpayers. I am sceptical that the maths will work out that way. Instead, any windfall would be shallow and short-term thinking, simply playing with numbers and window dressing, ignoring the devastating long-term effect on enterprise and employment.
There is also mention that the Government intend to cut investment allowances with a view to funding a corporation tax cut. This idea will benefit only non-productive companies such as those in financial services, which make large profits with very little investment. Investment allowances have encouraged manufacturers to invest in leading-edge plant and equipment. They also release more working capital to them. These companies create employment, train the young and win valuable export sales. This is not the time to demoralise them or to create cash-flow problems for them. It will make them think twice before investing and, more to the point, investing in the UK.
Your Lordships will recall that last year I was engaged by the then Government to act as an adviser in areas relating to SMEs including, among other things, their relationships with banks. During that time, I attained quite a high level of understanding of the service provided by Business Link centres. I shall not speak of all the good things available to SMEs through these centres, save to say that it is a very good service. It makes a difference in helping and encouraging start-ups as well as hand-holding those already in business. I have heard that the Government are proposing major cuts, including cutting quangos or cutting costs at the RDAs, which worry me in respect of the future of Business Link centres. At the tail-end of my advisory role, I reviewed the cost of operating Business Link centres. I will be honest: despite being encouraged by what I saw out in the field, it quickly became clear to me that a lot of cost could, and should, be saved in running this service. I would wholeheartedly endorse a rationalisation of Business Link centres. It would generate significant cost savings if we made sensible changes by cutting duplication and centralising some of the services they provide. I am convinced that that can be achieved without any decay at all to the service they provide. My plea to the Government today is to say that, considering all the hard work in crafting this excellent service, it should not be abandoned or merged in some smoke-and-mirrors arrangement. I ask that it remains in place under its current branding and autonomy, albeit rationalised in cost terms so that it can continue to offer the great support it gives to the small business community.
In the March Budget this year, it was promised that government procurement departments will pay SMEs on time and allocate a larger percentage of their spending to small companies. I hope this promise is honoured by the Government, as it was one of the issues most voiced to me when I was engaged on the coal face with the SME community. Problems still exist getting on an approved government buying list. It is very complicated. It seems each and every department or council has its own criteria. I encourage the development of a simplified “one covers all” approval system to allow SMEs a fair crack of the whip, at least to be able to bid for the business.
My final topic is the old chestnut of the banks allegedly not lending to small businesses. Correct me if I am wrong, but do I detect in the past few weeks a complete silence on this, once branded a disaster area? From what I recall, it was frequently debated in this House and reported in the media. Why has it all quietened down? Is it that a problem did not really exist? Is it that those who complained now realise they did not deserve what they were demanding? Is it that for some people there has been a massive wake-up call that there are no free lunches out there?
The banks experienced a shock a couple of years ago from the world’s economic crisis. They were chastised for their irresponsible actions in getting into such trouble. Then, after the bailout, they were chastised again as to why they do not lend irresponsibly to every Tom, Dick and Harry.
Your Lordships will recall how this House, and those in the other place, raised concerns based on misreporting in the media of comments I supposedly made last year when trying to be realistic and honest on this subject. The then Government were so intimidated by this banking issue that in the last Budget they announced that the Financial Intermediary Service would set up a national credit adjudicator. So concerned were some that it prompted the noble Lord, Lord Razzall, then residing on the opposition Liberal Democrat Benches, to inquire,
“bearing in mind the well known views of the noble Lord, Lord Sugar … that there is no difficulty … obtaining finance from banks … that the noble Lord, Lord Sugar, will not become the adjudicator he referred to?”.—[Official Report, 25/03/10; col. 1067.]
I am delighted that the noble Lord, Lord Razzall, has decided to join in this debate and I look forward to his contribution, but let me allay any fears. There was never any intention of me being an adjudicator, but I did chair a committee tasked to find one. Interestingly enough, when the subject was discussed in detail to try to home in on what, if any, problem existed, it exposed many facets which needed consideration, including the possibility of concluding there was very little on which to adjudicate.
If I have one criticism of banks it is that they should be held responsible for giving detailed explanations to people as to why they have been turned down for finance. I am sure this constructive information will help companies understand what they need to do to with their businesses in future to secure finance. I am encouraged, as we start to see some recovery of the economy, by some banks divesting away from broking or other trading activities and refocusing, as traditional banks, on what they used to do best—lending money to businesses.
I conclude by saying how amused I was to hear that the Business Secretary—who last year, in response to my comments on banks, stated that I was “out of touch” in the business world—seems, having been in office for no more than 15 days, to have taken a leaf out of my book. Some may argue he infringed my copyright in his less than encouraging statement to the small business community when he said:
“I don't want to raise unrealistic expectations. I'm not going to go around the country with a chequebook signing cheques for every company that has a bright idea”.
If he carries on like that, who knows? He might get his own TV show.
Lord Haskel
My Lords, I congratulate my noble friend on his excellent speech in moving this Motion. For my part, I want to start first with a conundrum for the Minister. What do the following have in common: clothing with sensors that monitor and transmit data about people with long-term health conditions, so that they spend more time at home and less in hospital; an oral fluid that enables the police to detect the increasing number of drivers who are under the influence of drugs—previously they had to do this by observation; and a technology that will make our mobile phones more secure as they become a source of replacing cash in our wallets? The answer is that all three are Small Business Research Initiative programmes.
How does it work? A government department identifies a need for a product or service. Through the Technology Strategy Board, this is framed in the form of a competition. Small businesses enter and the winners gain a contract to develop and supply the product or service. Since 2009, more than 400 contracts have been awarded to mainly small businesses by 13 government organisations. As my noble friend Lord Sugar indicated, everybody benefits. Government departments procure new technologies faster and with managed risk. Small companies get paid contracts at the critical stage of product development. Some of the financing gap left by the banks gets filled.
This illustrates the reality of the relationship between government and small businesses, but there is also a lot of myth about this relationship. Sadly, the coalition agreement is strong on the myth and weak on the reality, so let me try to separate them out. Before I do, let me remind noble Lords why there should be a relationship between the Government and small businesses. As many fund managers will tell you, the reason is that many of our large companies have their best years behind them. They have experienced most of their growth and innovation and, unless they change, somebody else—leaner, fitter, more hungry, more innovative—will take their place and outperform them. The Government must encourage this to happen here instead of elsewhere.
It is a pity that we are not hearing from more noble Lords opposite—but that is the problem of having this debate during Ascot week. If they were here, they would say that the way in which to encourage small companies is to cut red tape and to have low rates of tax. This is where we have to separate the myth from the reality.
Let me start with the red tape. When the noble Lord, Lord Heseltine, became Secretary of State for Business, he promised us a bonfire of red tape. It did not happen because of lack of fuel. When Margaret Beckett became Secretary of State—I had the honour of serving in her team—we, too, tried to cut red tape. We started a website where people could tell us where the problems lay—anonymously, if necessary. As a result, we simplified the auditing and the VAT regulations for small companies, but the effect was not great. We asked a lot of businesspeople to be specific, but they said that the problem was a lot of small things hard to specify. I am convinced that a myth has grown up around the whole question of red tape and I urge the Minister not to let the myth distract her from the reality.
What is the reality? It is that the myth has held back all Governments from dealing with market failure and lack of competition by regulation. Look no further than the banks. Instead of regulating from the perspective of the customer—of the wider community—the regulation was captured by the industry. Let me give another example. I notice that once again the FSA is—or was—investigating the closed shop that controls initial public offerings in London, an important source of development finance for small companies. This unregulated market failure has been going on for years. The high charges certainly deterred me 30 years ago and it must have been the same for hundreds—perhaps thousands—of others. It is an example not of too much red tape but of too little.
The other area where myth and reality become confused is taxation on small companies. My noble friend Lord Sugar spoke of this. We are told that, if the Government raise capital gains tax, diminishing returns will set in and entrepreneurs will leave the country. The myth surrounding this relates to the so-called Laffer curve—tax rates on one axis and government income on the other. I am sure that the curve exists, but the trouble is that no one knows where it peaks. Economists cannot tell us because of the many external factors, as mentioned by my noble friend Lord Sugar. Actual tax rates have been as low as 18 per cent and as high as 90 per cent. The answer of course lies somewhere in between, but your guess is as good as mine. So do not let this myth distract you from the reality.
The reality is that small companies need help in their early stages when they are struggling to establish themselves. That is why at present they benefit from lower business rates, lower tax on profits and increased investment allowances. I ask the Government whether this will continue. In reality, tax breaks are needed earlier rather than later when a business has been successful and the investors are collecting their profits. Higher tax may encourage them to leave the money in the business long term, which is an objective in the coalition agreement. I agree with my noble friend Lord Sugar that there should be arrangements for those who invest long term.
What other realistic ways are there for the Government to encourage small companies? Europe provides opportunities. I find Mario Monti’s paper on the completion of the single market very convincing. The single market may provide more competition, but it will also provide more opportunities for our small companies—the kind of opportunities from which our economy will benefit. The Government are keen on a green economy. Raising the target to cut carbon emissions from 20 per cent to 30 per cent by 2020 will help small companies. It will encourage them to engineer new green technologies. We already have a Technology Strategy Board which can champion this.
Let me end with another conundrum for the Minister. What do the following have in common: an ozone laundry system, which is becoming the European standard to prevent MRSA and Clostridium difficile; a new carbon composite produced at lower cost and with a lower carbon footprint, which is currently being used on the brakes of a winning F1 car and being tested on aircraft and trains; and a shock-absorbing polymer, which is used not only by the MoD but in the shoes of ballet dancers all over the world to protect their toes? The answer is that all these are new technologies developed in Britain, which, through the Materials Knowledge Transfer Network, have been transferred to small companies, thus helping them to grow.
I think that my conundrums have demonstrated that under a Labour Government small companies flourished. Will this support continue? If so, I hope that the Government will stop pronouncing Britain bankrupt and start showing confidence and pride in the small firms that are our future.
Lord Taylor of Warwick
My Lords, I, too, thank the noble Lord, Lord Sugar, for securing this debate. The writer Robert Frost said:
“By working faithfully 8 hours a day, you may eventually get to be boss and work 12 hours a day”.
We all know that running your own business is hard work, especially if, like the noble Lord, Lord Sugar, you started it from nothing. In business, you do not need a wishbone, you need a backbone. I am afraid Ronald Reagan was right when he claimed that the most terrifying words in the English language are:
“I’m from the Government and I’m here to help”.
Over the last 13 years, business has become complicated, bureaucratic and full of red tape. The Minister now has an opportunity to kiss and make up with the business community—and by kiss, I mean “keep it simple”.
We know that the Government are not a cashpoint machine. The former Labour Government’s Chief Secretary to the Treasury left a note stating, “I’m afraid to tell you there’s no money left”. So we know that the economic recovery will not come from the public sector; it can come only from wealth created by the private sector—from business. The fact is that over 90 per cent of all business in the UK is small business, employing fewer than 50 people. The entrepreneur has long been recognised as an important driver of economic growth.
Enterprise UK is an independent business-led charity founded by the British Chambers of Commerce, the Confederation of British Industry, the Institute of Directors and the Federation of Small Businesses. This week the charity produced a report based on a number of ideas that had come from 100 companies in the UK, ranging from multinationals to small business owners. It makes the point that small business tends to be more innovative than large business. But in terms of ease of starting a new business, the UK ranks only 16th in the world. There are barriers. The main obstacles are red tape, bureaucracy and lack of access to finance. The UK will continue to face significant challenges over the next decade from increased global competition. As we know, financial power in the world is gradually moving east, and the UK must respond by building a new economy based on business solutions.
The report also points out that enterprise is more popular than ever. Over half of the UK adult population says that it would prefer to be self-employed, but positive attitudes are not enough. From education campaigns to TV programmes like “Dragons’ Den” and “The Apprentice”, in which the noble Lord, Lord Sugar, makes such an impressive appearance, people’s minds can be opened up to the opportunities of running their own business. But too many are put off from turning their business ideas into reality because they cannot find the right advice and support. In my opinion, mentoring has an important role to play in helping businesses start up; and libraries, universities, colleges, job and community centres should all play their part in linking potential entrepreneurs with locally based mentors.
I turn to another report, one produced by the Department for Business, Innovation and Skills in November last year about black, Asian and minority ethnic-led business. It made the point that that sector is vital to the UK economy. There are an estimated 310,000 ethnic minority SMEs in the UK, contributing around £20 billion to the economy each year. They make up about 7 per cent of all SMEs in the UK. There are higher aspirations within these groups to start up their own companies than within their white British counterparts, but the conversion to start-up remains low, again because of the ongoing problems of lack of access to finance, business networks and mentors.
Levi Roots is a reggae-singing businessman. I see from his smile that the noble Lord, Lord Sugar, is aware of him. Levi developed his own sauce, called Reggae Reggae Sauce. I declare no personal interest in the sauce other than the fact that a bottle is in my fridge at home, and it does taste good. But Levi realised that that was not enough to make it sell. After years of failure and disappointment in life generally, he adopted the bold approach of going on to the “Dragons’ Den” TV show—he probably could not get on to “The Apprentice” because it is too popular—with his guitar and a bottle of his sauce. He presented his business plan to a stunned panel in a rather unusual way by singing his plan and the merits of the sauce. Well, it worked, because he was signed up by one of the dragons. That sauce is now sold in major retail stores all over the country. However, not every aspiring businessman can play the guitar or sing, so we have to make it easier for people who cannot sing and cannot play the guitar—I am not convinced that Levi Roots can sing and play the guitar—to succeed
The taxpayer bailed out the banks but is not getting the right service in return. The banks may be led by the new big society bank about which we have heard, but they must start to provide the small business community with the finance it needs to survive and grow. I agree with the noble Lord, Lord Sugar, that if applications for finance are turned down, businesses should be given the reasons for that refusal; often they are left completely in the dark.
Corporation tax should be reduced, both the main rate and the small companies’ rate. The Government should also exempt all new businesses from employers’ national insurance payments on the first 10 employees they hire in the first year. They should also reduce the burden of red tape. No new regulation should be introduced unless the burden can be reduced elsewhere—one in, one out. The number of forms needed to register a new business must be reduced. Again I agree with the noble Lord, Lord Sugar, on that point. There should be an end to restrictions on people starting a business in social housing. This would enable social tenants to become entrepreneurs.
There is a desperate need to simplify business taxes in order to give small businesses more certainty and stability. The Government must maintain generous tax exemptions to encourage enterprise. The income tax threshold needs to be increased, helping to lift millions of people out of income tax altogether and improving incentives to work.
The noble Lord, Lord Sugar, mentioned the thorny issue of capital gains tax. There are genuine concerns about the difference between the rate of capital gains tax at 18 per cent and income tax of up to 50 per cent as this could provide scope for tax avoidance by changing income into capital gains. At least the existing annual threshold of £10,000 must be kept, with any gains below this level being tax free. The Government’s aim must be to encourage savings and responsibility, not to penalise them. Capital gains tax could be tapered so that anyone selling assets would pay the tax at an increasingly lower rate the longer the assets were held.
Government procurement needs to be extended to small and medium-sized businesses. Again I agree with the noble Lord, Lord Sugar, on that. There should be an aim that at least 25 per cent of government contracts go to SMEs. The KISS principle should certainly apply—keep it simple.
The Government need to make Britain Europe’s leading high-tech exporter of manufactured goods by implementing Sir James Dyson’s recommendations to boost science and engineering. Apprenticeships tend to be associated with manufacturing and engineering, but we must not forget that they apply equally to the creative industries—media, music and the arts generally—which make up 8 per cent of UK GDP. Training for skills needs to be encouraged within that sector by further investment.
Finally, I encourage the Government to develop their Work for Yourself programme to enable people to move into self-employment. They need to continue to partner groups such as the Prince’s Trust and the Bright Ideas Trust and to offer support to the small business community.
Enterprise not the state will restore our economy, and I urge the Government to allow enterprise to lead the way so that Britain can be open for business again.
Lord Harrison
My Lords, many of your Lordships have run successfully big businesses. That is why I am encouraged to welcome my noble friend Lord Sugar, with his experience of small businesses, and the two succeeding speakers who also have knowledge of small businesses and the field of being hired and fired. If there is one thing that I could bequeath the business community in the United Kingdom, it would be the American approach, where to fail is not to fail. If you fail in one small business and fail in the next, you win in the one succeeding. If we could inculcate that view, we would go a long way towards establishing an even more successful small business community.
Labour’s record has been good; the noble Lord, Lord Haskel, detailed it well. Chancellor Brown had 10 years of stability, which is so essential for small business to grow. At the time of the global financial problems and instability, he it was who encouraged the G20 in 2008 to co-ordinate the stimulus which I think has worked and been successful. Indeed, there is evidence that it is working, albeit that the recovery may be fragile. That is why I say that the Government must be careful not to introduce precipitate, insensitive cuts which would cut off the recovery and, in turn, result in a double-dip recession. They should not resort to fondue economics, forever dipping in and out of recession. What businesses require above all is stability, because it gives SMEs the opportunities to plan, to invest and to expand. For 10 years, we had that stability, and we must recover it.
Labour’s record is good. There were 4.8 million private sector enterprises in the year for which they were last counted. That was 2.2 per cent higher than the year before and the highest number of small businesses since 1994. It is interesting that the stimulus in the last two years of the outgoing Government has resulted, perhaps unexpectedly, in fewer people being unemployed. There were threats of 3.5 million people being unemployed; the figure stands at just under 2.5 million. I think that that shows that the one thing that small businesses wanted to cling on to was people, relevant staff, who would lead them forward once the recession had been left behind. The Sunday Times reports that small businesses in Scotland were prepared to ban the use of first-class stamps or to phone around suppliers to cut by 10 per cent electricity, phone and internet costs, but they were determined to retain key workers, because small businesses rely on people, whether they are entrepreneurs or those who work with them. I ask the Minister to say what HMG can do to encourage the retention and expansion of the skills of small business people.
I want to be positive today. We have a new, alliance Government. This offers new opportunities, not least because the two parts of the alliance have had to bring together their ideas to form the coalition agreement, which contains a good section on small businesses. It is also good for our party after 13 years to have a period of reflection and renewal. We can be proud of what we have done, but we, too, need new ideas. We are therefore in a state of flux where new ideas can flourish. Where should they not flourish if not in small businesses?
I have analysed the coalition programme to see which parts are attributable to which of the two parties. It is a bit like dissecting the Beatles’ songs to see whether it was Lennon or McCartney who was the major contributor. The plangent bits are more Tory; the softer bits are more Lib Dem. That is illustrated in the vexed question of small business taxation, IR35, which has plangent elements and softer bits. I would be interested to hear the Minister dilate on the coalition programme and the elements of it which refer to small businesses.
I offer the noble Baroness, Lady Wilcox, my welcome. I know that she will be a feisty campaigner for small businesses and am very pleased that she is coming to address the Genesis Initiative, outlined in Britain’s Economic Revival. I shall raise some of the ideas expressed there. One initiative is that there should be a small business person within the Cabinet. Would she reflect on that? The legislation that applies to small businesses covers the whole field of government policy, and we need someone at the centre to see and understand that. Also, the noble Lord, Lord Taylor, has just mentioned that public sector contracts should be made more available to small businesses. That is a good idea, but how do the Government plan to achieve that in not too mechanistic a way—say, 25 per cent?
I have given the noble Baroness notice that I wanted to raise the question of succession planning. Too many small businesses fall by the wayside for the lack of having someone to take up the cause of the business when the proprietor retires. Certainly, when I was in Brussels speaking about small businesses, I remember the Commission producing a very important document highlighting that. Does the Minister have any figures on that? If I may be bold enough to suggest this to my noble friend Lord Sugar, it would be a very interesting area to explore, because we lose businesses that are absolutely viable for the want of someone who is in the know, who can take up such businesses and carry them to new heights.
I should also like the Minister to examine the world of audits, which my noble friend Lord Haskel mentioned, with regard to his period of looking after small businesses. Much was done by Labour to improve the situation, but a recent article by Anthony Hilton in the Evening Standard says that most audits are useless. I would not say that, but most audits coming from the big four on big business are questionable in the sense that they are so guarded and hedged that they do not provide proper information. However, a good audit for a small business is crucial for a better understanding by the entrepreneur of the business and its prospects. What ideas do the Government have for improving what I would hope could be meaningful audits that actually help the business to grow?
I want to mention red tape. The noble Lord, Lord Taylor, mentioned the “one in, one out” approach to red tape, but that can be naive and time-consuming, as well as too mechanical. We do indeed want to reduce red tape to ensure that it becomes the framework in which the invisible hand of the market can operate. However, you need a Government to frame and police the market. We have too little policing of the markets that are established, and we need to be careful about that.
I shall conclude on the European Union, and the biggest ambition, which I know that the noble Baroness, Lady Wilcox, will share with me, of achieving the single European market. If we were able to achieve that market, and make it viable for British businesses to use their expertise and energies in it, we would give them a wonderful opportunity to succeed. I shall give an example that the noble Baroness, Lady Wilcox, might like to take up. According to GE Capital, 60 per cent of UK businesses that export into Europe still only export and invoice in sterling. That is not good enough when you are dealing with customers.
I conclude by saying that I am very grateful to the noble Lord, Lord Sugar, for securing this debate. I hope that it can be a productive debate and flow with ideas and that the Government in both their parts can be athletic in responding to the genuine flourishing of 100 ideas, which I hope we hear today.
Baroness Gould of Potternewton
My Lords, like other noble Lords, I thank my noble friend Lord Sugar for initiating the debate. I also thank the many organisations that have sent me information. How pleased I am that the noble Baroness, Lady Wilcox, a successful businesswoman herself, is replying to this debate. It is the role of women entrepreneurs and women business owners on which I wish to concentrate my remarks. I want to try in some way to get a guarantee and an assurance that none of the Government’s new proposals will in any way deter women from entering the business world.
There are different categories of women in business, be it self-employed women, women employee-owners or women entrepreneurs. While each category may have different specific requirements they all require differing degrees of initial funding, refunding and support mechanisms. Encouragingly, the support mechanisms we have in place at the moment have meant that all those categories have steadily grown. However, there still appears to be a perception of women as a disadvantaged group outside the mainstream. That generalisation needs to be broken; it perpetuates a feeling of exclusion for some who have yet to reach a level of awareness to see that anything is possible.
The COGS 2009 report, Challenges and Opportunities for Growth and Sustainability: A Focus on Women Entrepreneurs, provides significant evidence which clearly makes the case for a more holistic approach and dispels a number of myths about women’s business. Women invest as much in their businesses at start-up as do men. Women experience similar rates of job and turnover growth to men from when they started. Women’s turnover growth and job-creation expectations are similar to men’s. Women are prepared to work the long hours in order to make their businesses succeed, and they are more likely to appreciate the business support they get from public and private sources and to feel that they are creating intangible value through their companies, as well as tangible value such as market share and company value. Yet all the women who participate in enterprise offer a wealth of untapped talent and economic opportunity, and are crucial to the service and retail industries.
What, then, is the motivation for women joining the business-owning community? According to the Labour Force Survey of 2007, despite general similarities between the reasons given by men and women there are significant differences. Those need to be taken into account. The most notable difference was that women were five times more likely than men to raise family commitments, the freedom to choose their own hours, to work at home and flexibly; conversely, men were almost twice as likely to say that one of their reasons was “to make money”. That was again evidenced by the COGS 2009 survey, which further identified that 62 per cent of women felt a desire to make a difference either socially, environmentally or in job creation, compared to 37.6 per cent of men.
Women-only businesses already contribute significantly to the economy, with an annual turnover of £130 billion, so without question women’s entrepreneurship is an important driver for economic growth, competitiveness and job creation. Stimulating entrepreneurship is an important challenge for the whole UK. More women-led enterprises are needed to increase the stock of businesses and so contribute to economic growth and innovation.
There has, over the past few years, been significant government investment in a variety of initiatives aimed at supporting women on their entrepreneurial journey. Those have ranged from the strategic framework for women’s enterprise to the establishment of the women’s employment task force and the enterprise strategy. Those initiatives were accompanied by funds, some specifically for ethnic minority women; as an aside, it is interesting that women from ethnic minority groups are more likely to be growth-oriented than men in the same groupings. We should take note of that. There is also the Aspire fund, which was launched in 2008 with the aim of co-investing and investing in women-led enterprises through Business Link.
Business Link has substantially increased its reach to female customers and has made a noticeable difference to the number of women in the SME sector. Overall, it is estimated that women-owned businesses accounted for around one-third of Business Link customers in the past four years. This morning I had breakfast with a woman who is now running her own successful business. I said that I would be discussing Business Link, and she said that she could not have started or continued her business without the support that she got from it.
The coalition agreement raises questions: will the Minister clarify what is going to happen to Business Link if the RDAs are abolished? How will the popularity of RDAs be determined, and will their role in developing SMEs play any part in that decision? It is estimated that women account for 40 per cent of customers using government-sponsored business support services. Which services are going to be maintained?
There is a concern that local enterprise partnerships will have a detrimental effect on the expansion of businesses rather than having a regional structure that means that businesses can stretch across the regions in a simple and easy way. Will there be a continuation of any government funding specifically to assist women starters? The outcomes of these decisions are crucial for women who have not been able to raise funding from their own or from external finances such as the banks, as they are four times more likely to access a source of government grants than men.
Of course, there are different ways of funding, both for setting up a business and for its development, but initial support for business start-ups is critical and for many women it will be the first time that they have sought funding, so they will require support and advice. Again, it is Business Link that has provided much of that support and advice. It will be crucial in maintaining women who are starting businesses. Many women have a lack of self-belief, concerns about finance and confusion about red tape. Those are commonly cited reasons for women not launching their own enterprise, so advice, training and networking are essential elements in taking that leap of faith.
Some years ago I did an Industry and Parliament Trust small business fellowship, looking particularly at the development of women ownership. I spent a day at Barclays Bank sitting in on a training session for women who were considering or wanting to develop or start a new enterprise. What was fascinating was that it was almost possible to identify those who would succeed—it was not those who had just had a bright idea and expected others to help them with it but those who had taken advice, done their research, looked for a gap in the market, had a strategy and a properly worked business plan and developed financial skills. The support mechanism to ensure that they have the capacity to look at all the things that contribute to starting a small business is essential.
The advice has to be clearly understood. There are specific issues faced by women in accessing finance in general and risk capital in particular. Again, this is provided by Business Link. I accept, though, that that support, in the form of financial or personal development initiatives, has to be based on whether the businesses are viable, sustainable and scalable.
According to the British Association of Women Entrepreneurs—I am sure it is right—the majority of women entrepreneurs focus not on the fact that they are women but on the fact that they are business owners, and they are not looking for preferential treatment. However, they want mechanisms in place to encourage and guide those who want to make that dramatic change in their lives and become their own boss. I would like to hear an assurance from the Minister that all the initiatives will in no way be cut, so that there will be no way in which women will be deterred from starting their own businesses.
Lord Borrie
My Lords, I understand that the speakers list has been changed so that the noble Lord, Lord Razzall, will be the last of the Back-Bench speakers and I am therefore in this slot.
I, too, congratulate my noble friend Lord Sugar on initiating this debate. He has many remarkable gifts, one of which is informing people about significant public issues through entertainment, as shown in his highly successful television programme, “The Apprentice”, and its successor. I wish him continued success in that, not for his own sake or for my enjoyment but because the success of that programme is of benefit to the economy in terms of a greater appreciation among its viewers of the value of training, effort, challenge and hard work.
I also congratulate the noble Baroness, Lady Wilcox, on her ministerial appointment and I look forward to her winding up this debate. She has been chairman of the National Consumer Council and she succeeded me as president of the Trading Standards Institute. Particularly from those vantage points, I think that she will agree that the ultimate purpose of business, whether small or big, is the satisfaction of the customers or consumers, whatever you call them. In order to achieve that, entrepreneurs, particularly those in small and medium-sized enterprises, need fair access to credit facilities, the timely payment of money that is due to them for services rendered and rules regarding a matter that has not specifically been mentioned so far today—ensuring fair trading between small suppliers and supermarkets, which seem to be getting bigger and bigger.
My noble friend Lady Kingsmill, who I do not think is present today, said in the debate on the gracious Speech:
“Since the beginning of the banking crisis, we have lost more than 30,000 small firms, and the drying up of bank credit is largely to blame”.
She said that there are too many,
“businesses with solid credit records being refused loans or offered them on … punitive terms”.—[Official Report, 2/6/10; col. 354.]
A short while ago, the noble Lord, Lord Taylor of Warwick, referred to the fact that sometimes these refusals are given without any reason or explanation.
A related aspect of this problem is that SMEs that are largely or even wholly dependent, as many of them are, on reasonably prompt payment of money that is due to them are too often kept waiting because customers—often, perhaps, with substantial resources, though not necessarily—ignore their contractual commitments to pay debts promptly. As someone once put it, “Money delayed is money denied”, a phrase similar to the one that we lawyers are familiar with from Magna Carta:
“Justice delayed is justice denied”.
The Government have made some efforts to ensure that at any rate their own debts to business should be paid promptly and they have encouraged all sorts of government agencies—quangos, if you like—to do likewise. However, despite the passing of an Act of Parliament whose terribly long name is not terribly well known—the Late Payment of Commercial Debts (Interest) Act 1998—to enable people to sue for statutory interest at 8 per cent above the bank rate on delayed payments, it hardly needs me to explain that creditors, particularly small and medium-sized enterprises, are reluctant to engage a substantial customer in legal proceedings. They do not exactly want to lose that major supermarket as a customer. There are not that many alternative customers.
I have wondered whether it might be desirable to enable public officials to take up the cudgels on behalf of several SMEs. Usually, not just one or two but umpteen of them have the same sort of problem with a particular major customer. Officials could do so on behalf of people who are owed long-standing debts and could take the necessary court action. I mention this particularly because the noble Baroness, Lady Wilcox, has such knowledge of trading standards officials and local authorities and she may sympathise with this approach.
There is also a question about a relatively unknown provision—I seem to be devoting myself to relatively unknown legal provisions today—in the Companies Act, which requires that businesses specify their payment plans in their annual reports to Companies House. Apparently, some 4,000 companies do that, as they are so legally required. Unfortunately, another 6,000 do not. The latter are acting illegally. Who is supposed to be responsible for enforcing the law and why do they not do it?
A concern of small suppliers in the food industry is the other problem that I wanted to mention. Farmers, particularly small farmers, and others are often faced with credit terms that are unilaterally extended for the benefit of powerful supermarkets, which have the clout that can rarely be matched by small suppliers. The last Government accepted in principle the view of the Competition Commission, which had carried out a two-year inquiry into this matter, in 2008. It said that what was needed was a grocery market ombudsman to investigate complaints, anonymous or specified, that supermarkets were being paid unfairly and contrary to the detailed code of practice that exists. The Competition Commission accepted that the grocery market was generally competitive—as ordinary ultimate consumers, we all know that the benefits in variety, quality and price of supplies have come to us. However, there are abuses. One of these is retrospectively imposing charges on suppliers to finance some special offer that the supermarket has decided to give to the consumer. There are elements here of what my noble friend Lord Haskel would undoubtedly call a market failure. It needs some form of redress.
Page 13 of The Coalition: Our Programme for Government says that the Government will introduce,
“an Ombudsman in the Office of Fair Trading”,
to curb abuses of power of the kind that I have just mentioned. The Minister will know that a Private Member’s Bill had a Second Reading in the House of Commons in March, not long before the general election. The Bill proposed that the Office of Fair Trading should create, but not itself act as, an ombudsman. The Office of Fair Trading would create an ombudsman that would be, the Bill emphasised, independent. My question to the Minister is a simple one: can she explain more precisely what the coalition Government intend in following up this matter?
Lord Corbett of Castle Vale
My Lords, I, too, welcome the noble Baroness to her new responsibilities and I congratulate my noble friend on the measured and informed manner in which he opened this Labour Back-Bench debate. It is a pity that the monitors do not make this clear so that everyone can know exactly what is going on.
I come from the West Midlands, which is the cradle of the Industrial Revolution. We built the first iron bridge and named a town after it. We built the first iron boat. Men such as Matthew Boulton, James Faraday and James Watt—with his steam engine—pioneered that era’s technology, which gave us immense prestige and power all around the world. More lately, the regional development agency, Advantage West Midlands, has provided £19 million, which has been invested in research and development for some of today’s technology—in this case, low-carbon vehicles. This is centred at the University of Birmingham, which also hosts the national nanotechnology centre. Invention and innovation are in our bones in the West Midlands.
It is an enormous shame that the coalition Government started their life by immediately breaking promises that they gave over the Future Jobs Fund. In the course of that, they will this year deny an estimated 80,000 young people the chance either to set up their own business, or to get the kind of jobs and develop the skills they need to make successes of their lives and contribute to our economic recovery. I do not say this in a flippant manner. The then leader of the Opposition, Mr Cameron, in Liverpool described this as a great scheme. He was backed up by Mrs Theresa May, then a member of the shadow Cabinet, who said that the Conservative position had been “misrepresented” and:
“We have no plans to change existing”,
Future Jobs Fund “commitments”. Little Mr Echo, Steve Webb, on the Liberal Democrat Front Bench, was even more explicit. He said:
“We have no plans to change or reduce existing government commitments to the Future Jobs Fund”.
You could normally bank those promises and undertakings, but they were broken, torn up and ignored, even before the ink was dry on them. In my own region, an allocated 10,100 jobs under the fund will now not happen, and young people under this Government will be forgotten and left to rot, as they were in the 1980s and early 1990s.
The Prime Minister has a great sense of irony. The Minister he appointed as Secretary of State at the Department for Business, Innovation and Skills is none other than the man who spent the election campaign arguing for its abolition, but we will pass gently over that. The smell of power encourages people to change their minds.
I declare an interest as an ambassador for Advantage West Midlands, our regional development agency. Its record is impressive in a region which has stubbornly high unemployment and too low a level of new small business start-ups. In a word, there is a lack of entrepreneurship. Overall, for every £1 invested by Advantage West Midlands, £8.14 is generated for the regional economy. Between 1994 and 2007, new business growth was 1.6 per cent a year—a tad lower than the national figure. Matching national growth would have produced something like an extra 5,000 new businesses in the region. The new Secretary of State for Business has caused great confusion with his remarks yesterday about the future of RDAs. He said that:
“RDAs will be replaced by local enterprise partnerships”.
He went on to say that the RDAs,
“will be replaced, but the structures that emerge could have a regional scope if that is what people want”.
He added further to the confusion that he has caused by saying that RDAs,
“will not perform the same range of functions as they do currently”.—[Official Report, Commons, 16/6/10; cols. 906-08.]
That has got the Government off to a good, clear start, has it not? Significantly, the Secretary of State said not a single word in that debate in another place about the financing of the RDAs. Maybe the Minister will have something to say about this in winding up. What will their funds be? Will they be cut, left alone or expanded? On what basis will they be allocated? We need to know this.
In 2009-10, Advantage West Midlands invested more than £150 million in business support activity, aligned with the then Government’s Solutions for Business products portfolio. This meant that it assisted 28,000 businesses, safeguarding or creating 17,500 jobs and assisting 17,000 people with their skills needs. This real assistance at a time of economic peril will be at risk if the axe is taken to AWM and other regional development agencies. It will deny those opportunities—we desperately need those opportunities to grow our way out of this financial meltdown—to budding entrepreneurs, add to the bill for keeping people idle, slow economic recovery and depress life chances and community cohesion. Now, self-employment among men in the West Midlands is close to the national average. Among women, it is the lowest of all the UK regions. Young people also have lower rates of self-employment in the West Midlands than nationally and the same is true of minority-ethnic groups. Importantly—I know this from the experience of a very successful secondary school in my former constituency in Birmingham—attitudes among young people to starting their own businesses are exceptionally positive, reflecting the success of improved secondary school teaching and learning and the rising aspirations of today’s young people. That, surely, is what any Government should want to encourage.
I wish to give some examples of the success that Advantage West Midlands has had in assisting the start-up of small businesses. Vicky Cargill, of Remote Business Support Ltd, offers virtual PA services, including audio transcription, presentation, formatting to diary management and marketing advice from her home. She took advantage of a three-day start-up course run by Business Link West Midlands, and already has several clients. Peter Morrison of BioFuels International is the first in the United Kingdom to manufacture an eco log made from compost material, 70 per cent of which is fallen leaves. With help from Business Link, he secured the patent pending on the leaf-log invention and he and his partner are now awaiting exclusive rights to trademark the name. An Australian couple, Michele Forge and Stephen Burnett of Greenbean Mobile Coffee Company, set up an Aussie-style mobile coffee company with a difference in Stratford-upon-Avon. They travel between business parks, markets, food festivals and trade fairs in their bright green caffeine machine dispensing hot drinks. Steve Westwood and Emma Wood set up SEMS Wood and Wax. They did not let redundancy or the impact of the credit crunch stop them having a go at running their own business. They have used support from Business Link to launch this wood and wax retail outlet specialising in quality second-hand furniture, candles, holders and fragrances for the home and are currently putting the finishing touches to a 1,000-square-foot store, which will offer a large selection of their goods. Kevin Jew and Kenneth Mole set up KJ Fasteners when their employer went into administration after three decades. They are looking for a turnover of half a million pounds a year. In only the second year of their business, they got help from Business Link West Midlands and are striking out on their own as nut and bolt distributors.
These are all vital pieces in the jigsaw of getting economic recovery going. I say to the noble Baroness that nothing which this Government do should imperil that entrepreneurship. We need to encourage it, not to chop it off, particularly as the recovery is still so fragile. I hope very much that the noble Baroness will clear up this confusion about the RDAs because lots of people, not just those working for the RDAs, have built up a lot of experience. People are looking to support from the RDAs and want to know now—perhaps they are in the middle or early stages of their engagement with RDAs such as Advantage West Midlands—what will happen. I hope that the noble Baroness can put their minds at rest and give them a nice weekend.
The Earl of Erroll
My Lords, I thank the noble Lord, Lord Sugar, for introducing the debate, especially as I am chair of the All-Party Parliamentary Group on Entrepreneurship. I endorse the comments made by the noble Baroness, Lady Gould. There has been a series of events over the past couple of years concerning enterprising women and entrepreneurship. It is interesting to see that some of the things which are perceived as women’s issues are generic to everyone. However, some barriers exist, and a lot of it is due to people’s mindset. Being married to a highly enterprising woman, I have certainly encountered people who see her as a “little blonde”. Someone said to her on a building site the other day, “Goodness gracious, you do know what you’re talking about, don’t you?”, when the job in question was being made a complete mess of.
One of the reasons why I am very interested in this area is that, to me, SMEs are the country’s engine of growth and innovation. The successful SMEs get larger, and larger companies, which tend to rationalise and downsize, swallow them up, which gives the entrepreneurs money to start something else. Big businesses rationalise and downsize SMEs to try to make themselves more efficient. SMEs are not necessarily the most efficient organisations because they are concerned with getting the job done and with growth. Therefore, they do not have time to get involved with tons of regulation and risk.
I wish to break up this subject into four areas: regulation, finance, mentoring and incentive. A lot of what I intend to say applies to all small and micro businesses. They are not all entrepreneurial; many of them are sole traders, one-man bands, but they all have similar characteristics. I often hear it said that about 3 million people are employed in these businesses. That is a very large slice of the taxpaying population and we disadvantage them at our peril. Many of these bodies are not incorporated; they are not limited companies. Therefore, many of the breaks available to limited companies do not apply to them.
As regards regulation, these businesses are terrified of inspections, with all the HSE issues. They may not be aware of all the regulations in relation to their VDUs, offices and the disabilities Act, but they are meant to be complying with them. What is worse, they do not know what it is that they do not know. As regards contracts of employment, they may not be able to write an acceptable use policy for computers. They may not know their rights regarding monitoring and what they should put in place to protect themselves should inappropriate material be sent out via their e-mail address. All sorts of issues arise that small businesses may not be aware of. Moreover, the staff are concentrating on running the one thing on which they are expert.
As a result, people such as my wife who would have expanded their businesses to a far greater extent do not dare risk employing people in order to do so. They do not know whether they will say the wrong thing when conducting a job interview and be sued. That is very easy to do. You do not take someone on to become an extension of the social services; you take them on to work for you and to help you try to build a business. You are told that certain exemptions apply to companies that employ below a certain number of employees, but does that refer to head count or full-time equivalents? If you are a sole trader and you employ someone to do the garden or help clean the house, are such domestic employees included in your head count of employees, even if they are non-business staff? Where will you find out that information? It is too detailed. The procedures for getting rid of someone who does not fit in or do the job are totally inhuman. If they have a problem such as depression and the employer sends them an official letter, what is the first thing they will do? Will they commit suicide? Do you really want to do that to someone? In a small business, you are living on a far more personal level with these people. The procedures laid down by civil servants sitting in large offices just do not work in small businesses.
I entirely agree with what the noble Lord, Lord Sugar, and everyone else has said about procurement. The unintended consequences worry me. For example, the Equality Act says that the Government will drive the equalities agenda by government procurement throughout the supply chain. That is a clear intention. That could wipe out small businesses further down the supply chain. How many small businesses can, or know how to, tick the relevant boxes on equality, climate change, energy, sustainability and all the other bits and pieces and conditions that you are expected to fulfil on a government procurement contract? As the noble Lord, Lord Taylor, said, you cannot get on a government procurement list if you cannot tick the boxes. I think that the noble Lord, Lord Sugar, also mentioned that, and it has been referred to by several other noble Lords. The trouble is that the Civil Service perceive risk as not ticking boxes; it is not about failure. They say, “If you don’t have 14 months of accounts, you are probably not secure enough”. The Government have lost a lot more money with the failure of large systems integrators on the NPfIT, the Rural Payments Agency and several other large contracts than they will ever lose from a few small contractors going out of business. It would be a lower risk to get small innovators in there and to stop wasting huge fees of up to £9,000 per day on consultants who have no incentive to conclude a contract.
A lot of finance for start-ups comes not from banks but from friends and family. People do not really know what to do at this level. There are one or two business angels, but you have to know them personally. Sometimes the Government step in competently in some areas where people are better organised. The Welsh Assembly Government and Finance Wales have helped several people I know to get off the ground and become established there. There is a long way to go, but it is worth it, and there are some good set-ups. It is sad that, in certain other places, RDAs have not been able to emulate that, but it may help local areas.
The Government’s tax regime makes life difficult for cash flow. If you have a really good year, you will have to pay up front half the tax on next year’s possible profit, and that hits your cash flow. If you then want to invest, perhaps in equipment, you will not have the spare cash to do so. It is not taken off your tax in its entirety in the first year. In your first year, you will save only the tax percentage of the depreciation due that year. If your tax rate shoots up to 40 or 50 per cent, it will take you much longer to repay the capital loans that you have put into your business. This happens in any business. You do not think about doing it. It makes such investments uneconomic.
Then, the Government do things like proposing an extra eight days’ holiday. That is equivalent to a sudden 3.5 per cent pay rise. What will you do when these people are not working? You suddenly have to bridge the gap, because you no longer have people to do the accounts. How do you employ someone for half a day a week? Sometimes there are many unintended consequences of measures such as this.
We have talked about the banks. There was a big issue over rebalancing the balance sheet and calling in well secured overdrafts. The banks left the dodgy companies alone but called in the overdrafts of people who were well secured. That bankrupted a few businesses. As for the “know your client” rules and foreign investors, I have been involved in development and I know that it always runs late. People will suddenly need a cash injection and foreign investors, who are sometimes ex-pats who have made a lot of money, may be willing to take a small risk for £10,000, £20,000 or perhaps more. Have you tried to get money into a company in such circumstances? Perhaps you are setting up a new company with a foreign investor and trying to get past the “know your client” rule. I have seen companies go bust while waiting eight weeks or more, which is normal. Does that really prevent money laundering, as it is supposed to? Of course it does not.
The Government should invest heavily in infrastructure. We must have a good IT infrastructure if small businesses are to flourish from wherever they start. They are situated all over the place and are frequently not in town centres.
Mentoring is vital. Enterprise UK, the Chartered Management Institute and the Worshipful Company of Information Technologists mentioned to me that they have helped in this area. I highly recommend that noble Lords look at what these organisations have done. Many entrepreneurs are visionary. The trouble is that they often do not know how to run things. You need someone who knows how to dot the “i”s, cross the “t”s, talk to the bank and put together a business plan that has roots in reality somewhere down the line. That is difficult. I am delighted that Business Link has taken a huge turn for the better. Its image was that failed business people tended to end up there. It is wonderful to hear that it is getting better.
At the end of the day, this issue is all about incentives. It is sad that we have a tax structure that forces our highly successful people to go abroad into tax exile while we are a tax haven for other people. The answer is not to tax the foreigners but to have a favourable tax regime whereby our successful people can stay here to redistribute their wealth locally. That will boost employment and diversify skills. Such people do not sit on their cash; they either reinvest it or spend it. That employs more people. If you want to get the economy going quickly, allow people to keep some money. The Government will employ people on the big, heavy stuff and for the box ticking and paper pushing. Entrepreneurs who make money will spend it on other things—skills and the arts, including craftsmen and high-value people, and not the cheapest possible labour.
Finally, there are two other types of business. Some people are building lifestyle businesses, as the noble Baroness, Lady Gould, said, while others are building up businesses to sell and restarting again. Make sure that you let them keep their money so that they can restart here.
Lord Mitchell
My Lords, I congratulate the noble Baroness, Lady Wilcox, on her new position. I know that she started in a family business. I hope that she never forgets her background because it is crucial that in government she represents us in all these areas.
Sometimes I wish that Members of the other place, who are often dismissive of your Lordships' House, could be present at a debate such as this. There is real expertise, born of experience at the coal face and able to voice opinions and recommendations that really do have validity. Interestingly, of the 11 Back-Bench speakers, eight come from the Labour Benches. This contrasts with what I suspect happens in the inner circles of the Treasury and Her Majesty’s Revenue and Customs, where a PPE at Oxford seems to be the prime qualification for running the tax affairs and business policy of the nation.
I thank my noble friend Lord Sugar for introducing this vital and highly topical debate. The noble Lord is an entrepreneur to his very core and his successes are there for us to see. He started his business life selling aerials from the back of his car. I started mine selling vacuum cleaners door-to-door. You do that, you learn a lot and you never forget. But my noble friend has done more. When I started running my own business in the early 1970s, people thought I had taken leave of my senses. Not only was it risky, but it was somewhat socially unacceptable. Nice boys—never nice girls—where I came from joined banks, became chartered accountants, solicitors, or, heaven forbid, even estate agents; but start a business—never. In those days, we were simply not an entrepreneurial nation.
However, my noble friend Lord Sugar, through “The Apprentice”, has brought the thrills and spills of being an entrepreneur into the sitting rooms of the nation. Now people know that business is challenging and brutal, but is also fun and creative. We must thank him and others like him for changing attitudes very much for the better. I have to say that I notice young people coming out of universities, even those from Oxbridge, who are rejecting going into the City or the professions. They want to get into business as quickly as they can.
Being nice to SMEs is not just about speaking warm words, but goes to the very soul of our economy. In the United States, it is estimated that between 1985 and 2005, nearly all new net jobs were created by firms that were five years old or less. This amounted to 40 million jobs. That means that established firms created no new net jobs during that period. I bet that the same is true here. Unemployment will not come from bailing out losers, but only from new companies with new technologies and new business models. Think British Airways and then think Virgin and Ryanair. Think Apple, think Microsoft and think Google. None of them existed 30 years ago; indeed Google is only 12 years old. That is where the growth and jobs are to be found.
This new coalition Government will not get this sort of entrepreneurial growth if they continue in their plans to decimate our education system. Maybe Labour in government did not get everything right, but we were very clear that you cannot build a 21st century economy if you hack into our schools, our universities and our colleges of further education. What is proposed by the coalition Government for science is truly scandalous. The previous Prime Minister, Gordon Brown, has become much maligned, but he was always very clear that small businesses were key to our prosperity and that the tax system should reflect it.
I speak as a serial entrepreneur. In my career, I have founded and grown three quite separate businesses in the IT services sector. Each became a market leader, and two had major operations abroad. I created employment and my companies provided a vital service in the high technology marketplace. In each case, I sold my shareholding when I thought that it was time to move on. To be honest, it was when I became bored.
In 1987, when Margaret Thatcher—now the noble Baroness, Lady Thatcher—was running the show, I sold one company and was faced with a sizeable capital gains tax bill. It was in the region of 40 per cent. Today, 23 years later, writing out that cheque still hurts. Four years ago, I sold another company when new Labour was in charge and I paid 10 per cent capital gains tax. Now tell me, my Lords, which Government were pro-business and pro-entrepreneur? It is very clear that capital gains tax is going to increase—the Lib Dems demand it. On the other hand, many in the Conservative Party are against any change. The coalition is divided down the middle; next Tuesday we shall see who has won.
To me, it is very clear what a capital gain is. It is when an investment is made with the intention of securing a gain over a period of time; it is about the expectation of gain but the possibility of loss; it is about risk; it is about the medium to long term; but, most of all, it is about investment in business. Today’s CGT situation is plainly bonkers. It is far too wide and 18 per cent is clearly inappropriate for all classes of assets. However, I really believe that 18 per cent or something like that rate should remain in place in respect of genuine investments in business where the investment remains in place for the medium term—say, three years. In the UK, we tend to love complex, arcane tax rules that few understand. If there are to be changes, let them be simple.
During the recent election, the Lib Dems, and the Deputy Prime Minister in particular, fought the campaign on the subject of fairness, so I now propose two ways in which CGT and the tax system could be made much fairer and generate significant taxation revenues. The first, referred to by my noble friend Lord Sugar in his excellent speech, concerns the area of reward known as carried interest. These days, hedge funds, venture capital funds and private equity funds gain most of their return from carried interest. When a fund is set up and investors are located, the fund usually pays the managers an ongoing management fee—usually in the region of 1 or 2 per cent per annum of the fund’s value. This amount is used to run the business. However, in addition, when the investors eventually receive their investment back, any additional gain is usually split 80 per cent to the investors and 20 per cent to the managers. The investors have clearly put their capital at risk and any benefit they receive is a very legitimate capital gain and should be taxed as such, but how about the 20 per cent in the hands of the managers? Is that a capital gain? I do not think so. It is a fee earned by the managers and, as such, it should be taxed as income, but currently it is not; it is taxed as capital. This is not fair and should be reversed.
Secondly, continuing the example of unfairness, I want to refer to a particular bugbear of mine which I have raised in your Lordships’ House several times before. It is the subject of non-doms—people who were born abroad and are able to avoid tax on their non-UK generated income because they are effectively non-domiciled. This was a hot potato three years ago but it went off the boil when we in government dealt with it in a half-hearted manner because we were frightened of upsetting the City. If the Government want to be fair and courageous, they should say the following. If you were born abroad but live in the UK and you have lived here for seven years or so, then you have become a de facto resident. As such, you should pay tax on the same basis as the rest of us, and it should be based on your worldwide income. That is what the Americans and most other developed nations do. It is only fair. If people say, “Well, that’s too much. We’re off to Singapore or Geneva”, I shall say to them, “It’s better to be taxed to death than bored to death”.
It is not my Budget; it is Mr Osborne’s. However, if it were mine, I would make it small-business-friendly, I would keep CGT at its current rate for business investment and I would have no hesitation in plugging the carried trade and non-dom loopholes.
Lord Graham of Edmonton
My Lords, it is a joy and a pleasure to speak in this debate initiated by my good friend the noble Lord, Lord Sugar. When I first met him in the House, I looked him straight in the face and said, “PCW 9512 - Amstrad”. He laughed and said, “You haven’t still got one of those, have you?”. I said, “Yes. For our ruby wedding anniversary 20 years ago, my wife bought one of these and, give or take the odd little hiccup, it has served me well”. He said, “Get another one. Bring it up to date. There are better models out now”. He tried very hard but failed. I am sorry to say to my noble friend that it still works and gives me pleasure.
By now, my noble friend Lord Sugar should know that if you come into this House preceded by a reputation and a record of achievement, that speaks much louder than the words that you use and the speeches that you make. So we thank him very much for initiating this debate and for opening it so brilliantly.
I see from the Annunciator that the subject of the debate is “The Effect of Government Policies on Entrepreneurship and Small and Medium-Sized Businesses”. Of course, one cannot cover the whole spectrum, but we have had a feast today with various people speaking from different points of view. However, I want to speak from the perspective of the small business that has grown into a big business, and, with the support of this Government, as with the previous Government, there is more to come. I refer to credit unions and co-operatives. I tried to intervene during a Question on that subject this morning but did not manage to do so. The point I was going to make was that only last year the Department for Work and Pensions reported that those who used the services of a credit union paid £86 million less in a year than they would have done if they had borrowed the money from what one might call loans sharks, or small businesses that appear to be generous and fair but are not. In the context of the billions that we are talking about, £86 million is not a lot of money, but I am talking about little people.
Coming from the background that I did, one thing that inspired me was the realisation that one needs capital and capitalists, as well as big business and experience. We should not forget that invariably every big business was once a small business that was well managed, well directed and lucky, where those running it hit upon something that was not already available.
My main experience is of the Co-operative movement, and I shall come to that in a moment. However, in my view credit unions are a success story, and I know, because of what she said earlier, that the Minister will agree that they need to be encouraged and supported. I am not talking about large sums of money; I am talking about being loved and wanted and being part of the big picture. Nothing has pleased me more in life than going into a boardroom or a committee meeting and coming across what I would call ordinary people—men and women who have no pretence to be accountants or experts—who have taken on the running of a business, such as one in the Co-operative movement or a credit union, and are doing so because their heart is in it. They are not in it to get big fees or to make a profit from selling shares but because they know that their community needs it to keep going.
When I was very heavily involved in the Co-operative movement, there was a saying that the Co-op never made a millionaire or a pauper. I would rephrase the first part, as I think that they have made a few millionaires over the past few years. However, because of the soundness and ambition of the people that run them, no one has ever lost their money. I am talking about ordinary people who see a need in their community.
In Rochdale in 1844, weavers and mill workers, bereft of what you might call the wherewithal, having been failed by the churches and the Chartists, decided to form a co-operative, and from 28 people the movement grew. Now, the Co-operative movement is big business. It takes over building societies and successful retailers; it employs hundreds of thousands of people; and it is a success story. It has ambition. The great ambition of the Co-operative movement is to become mainstream in relation to the business community. What does that mean? It means simply that our rules, regulations and legislation have inhibited the spread of co-operatives. When the Minister replies, it would be helpful if she could say something about the ongoing relationship between the Government, the departments and the Co-operative movement.
At one time we knew the Co-operative movement as the CWS, the Co-operative Wholesale Society. It has now changed its name to the Co-operative group. When I was involved, the other body was the Co-operative Union which changed its name to Co-operatives UK. It is astounding that, many years ago, if one talked about the Co-op, one simply referred to the shop on the corner because, in the main, the Co-op was primarily a consumer-oriented business. We now know that the Co-operative movement is much more than that. It has always been and still is the biggest farmer—not a landowner—in the country. It has a big business in banking and insurance. I am not taking this as an opportunity to knock the banks, bankers or big institutions. Their reputation has taken a knock recently and people are examining the term “trust” in relation to the banks.
This could be a golden opportunity for the expansion of people-oriented businesses. What do I mean by that? The amount of money required to establish a credit union is very small, but they do a big job. I do not wish to bore the House, but I have some statistics. Partnerships with credit unions are big business: 60 per cent of credit unions work with schools; 60 per cent with employers; 57 per cent with housing associations; 50 per cent with citizens advice bureaux; 26 per cent with Jobcentre Plus; and 12 per cent with prisons.
The idea of a credit union is that one regularly contributes a small amount of money and so has access to loans. Twenty years ago, one of the fears was that they were being run by amateurs, people who did not understand accountancy and so on. That has all changed. They are now very successful businesses. Perhaps the Minister could tell us about the marvellous concept of marrying the credit unions with the Post Office network. The Post Office is struggling to maintain business, but with the nexus of credit unions, it could provide a banking service, built on reserves and backing from a wider movement. It could be a kind of people's bank, and it would be an opportunity to marry the two together.
I see that my time is up, although there is a great deal more that I could say. I am grateful to the Minister, who is a friend of mine. I respect her record in this area. I know that she will be good for the department where she works. I thank my noble friend Lord Sugar, as his presence in this House will be good for all of us.
Lord Razzall
My Lords, I join other noble Lords in thanking the noble Lord, Lord Sugar, for giving us the opportunity to express our views on this very important topic. I also congratulate the noble Baroness on her appointment, as she joins other Liberal Democrat colleagues in the department.
I should make it clear that I do not speak for the Government but for the Liberal Democrat partners in the coalition Government. Listening to all the contributions, one thing on which we can all agree is that it is vital that as little damage as possible is done in the Budget to SMEs, as it is now generally accepted that significant growth in the economy can come only from that sector, particularly, as a number of noble Lords have indicated, in the high-technology businesses which spring up. If they are fortunate enough to be owned by the noble Lord, Lord Mitchell, they will be sold for large amounts of money.
In an ideal world we would not be contemplating tax increases or any form of cuts in expenditure. Listening to the eight Labour speakers who have spoken so far—I think every speaker has come from the Labour Party except for the noble Lord, Lord Taylor—one would imagine that we live in a perfect world which they have created for the small business sector. To be fair, I do not think we can look at the problems that the Government face without looking at the overall state of the economy, left behind by the Labour Party.
Perhaps I can put on the record some of the numbers which we now have from the Office for Budget Responsibility. In relation to the Government’s forecast for growth for the next four years, by 2014 the estimate is that the economy will grow by only 2.6 per cent as opposed to the 3.5 per cent that Alistair Darling put in his last financial statement. Much of that growth will come from the SME sector, but it will be significantly less on this objective forecast than anticipated. Looking at the debt figures, one ray of sunshine in the Office for Budget Responsibility figures was that the actual borrowing costs for this year will be significantly less than originally forecast but, even given that, by 2014 we shall still be borrowing in that year £71 billion, of which £51 billion will represent the structural deficit, which means that the deficit that will not be eradicated by growth in revenues.
Other horrendous figures include the following: the spending on social security for this year will be £169 billion, which will rise to £192 billion in 2014. Perhaps the most shocking figure of all is that the interest paid on the British Government’s borrowing will rise from £42 billion this year to £67 billion in 2014. Those are absolutely shocking figures and explain why, when those figures were made available to the Liberal Democrat members of the coalition Government, we changed our minds with regard to the necessity to take action now. We went into the election believing that no action should be taken for the first year; we agreed with the Labour Party, but it had the information and we did not. For that reason we have changed our minds.
Listening to the eight Labour speakers, we would get the impression that all was well in the garden of the SMEs on their watch. I am not entirely sure that that is correct. As the noble Lord, Lord Taylor, said, we are regarded as the 16th country in the world for the ease of starting a business. We ought to be significantly higher. I will not touch on the restrictions, which the noble Lord did very ably. The noble Lord, Lord Mandelson, when he was Secretary of State—he is now, I understand, known as the third man—introduced many initiatives, many of which were unproven. Several speakers have rightly said how successful the Business Link centres were, but by the time that the Labour Government went out of office, it was unproven to what extent many initiatives were helping or were unhelpful.
Then there is the issue of the control of the banks, especially those in which there is significant taxpayer investment. The noble Lord, Lord Sugar, referred in his opening remarks to the witty exchange that he and I had on another occasion, when he said that he was misquoted as saying that anybody with a decent idea and a decent business plan could easily get a loan from a bank. Listening to what he said this morning, I got the impression that that is still his view. From my experience with clients and anecdotal evidence, that is not the case. Banks have made it much more difficult for small businesses to take advantage of loans. Often, they have required personal guarantees from entrepreneurs where no personal guarantees would have been required in the past. They have often required significantly increased interest rates. The general bureaucracy involved with a lot of the clearers in obtaining loans for small and medium-sized enterprises has been a problem. No one I talk to disagrees that that has been a problem. The overall problem has been that a large amount of capacity was taken out of the market with the collapse of the Irish and Icelandic banks. If all the clearers lent the same to SMEs as they did before the collapse of the market, a third or a quarter of the capacity would still not be there, so there would still be a shortage of funding.
It has become clearer recently—I am grateful for the research that has been done by the Institute of Directors—that it appears that under the Labour Administration, during the boom years of what are now known as the noughties, one-third of FTSE 100 companies paid no tax at all, while one-third paid only a nominal amount. Notwithstanding the marginally lower rate of tax for SMEs, during the Labour period, the SMEs’ share was disproportionately greater than that of the FTSE 100 companies. That clearly bore heavily on the SMEs.
What should the Government now do? We have had a very interesting debate on capital gains tax, and the noble Lords, Lord Sugar and Lord Mitchell, have come up with a lot of interesting ideas about what, even if the capital gains tax rate is to be increased, can be done to protect the entrepreneur and small businesses. The Government need to review the “Mandelson initiatives” to see which of them should be left in place—which of them have been effective—and which of them should be closed down as ineffective. The Government need to concentrate on the mechanics to achieve greater lending from the clearers, particularly those in taxpayer control, to SMEs.
To make a slightly partisan political point, bearing in mind the mess in the economy with which the Labour Government have left this Government, as Mr Attlee once said to Mr Laski, “Perhaps a period of silence on this topic would not come amiss”.
Lord Young of Norwood Green
My Lords, I, too, congratulate my noble friend Lord Sugar on securing this debate and on his excellent contribution.
Although I did not agree with much of what the noble Lord, Lord Razzall, said, I agree that this debate needs to take place against the backdrop of the coalition Government’s economic strategy. Recently, George Osborne was keen to point to the recently agreed G20 communiqué on the need for countries to reduce their budget deficits. He failed to acknowledge that the agreement also requires countries to put in place credible growth-friendly measures. The communiqué states:
“The recent events highlight the importance of sustainable public finances and the need for our countries to put in place credible, growth-friendly measures, to deliver fiscal sustainability, differentiated for and tailored to national circumstances”.
The communiqué mentions growth-friendly measures, not just deficit cuts.
Removing key support for industry, as the coalition Government advocate, far from strengthening the economy, will weaken it. The Government seem to see spending cuts as the silver bullet to rebalance the economy—something stressed by David Cameron in a recent speech at the Open University and by the recently converted Chief Secretary to the Treasury, Danny Alexander, who said:
“The best thing that we can do to increase growth and create jobs in this country is tackle the enormous budget deficit”.—[Official Report, Commons, 8/6/10; col. 171.]
Again, nothing is said about the importance of creating growth opportunities.
Far from having a plan to support growth, the coalition has, in its first acts, undermined growth by cutting regional development agencies, which support businesses across the country. My noble friend Lord Corbett gave a graphic account of the importance of Advantage West Midlands in helping SMEs to create new business opportunities. The Government have also created uncertainty for industries of the future by their decision to review the Labour Government’s policy of supporting those industries—new industries that have the potential to be strong and create jobs, whether by producing low-carbon cars or in the nuclear industry. Targeted government action can unlock the private sector investment that brings new jobs. That is why we decided to invest almost £1 billion in key industrial projects spanning a range of industries: aerospace, low-carbon electric cars, nuclear advanced manufacturing, and wave and tidal energy. If the coalition Government pull the plug on the Sheffield Forgemasters loan, for example, they will display a complete lack of vision for Britain in the worldwide nuclear supply chain.
Interestingly, in the belief that cuts are the way forward, Vince Cable said that he wishes his department to be the department for growth, but he sees no role for government and indeed wishes it to get out of the way. We believe that there is a vital role for government. It is not enough to have a strategy for deficit reduction; we must have a plan for growth.
The noble Lord, Lord Razzall, reiterated the determination to say that we—the previous Government—left the economy in the worst possible position, while seemingly he did not worry about the impact that saying that has not only in this country but abroad. I thought that the Office for Budgetary Responsibility’s recent report was interesting. Although the growth forecast clearly fell short—of course, we had not been able to take into account what happened in the eurozone, which will clearly have a big impact on growth—the report pointed out that the deficit in 2009-10 has reduced from £166.5 billion to £156.1 billion. Government borrowing was £10.4 billion lower than forecast at the Budget, proving that the Labour Government had taken a cautious approach in their forecast of public finances; indeed, we had set out a plan to halve the deficit over four years. We therefore reject the view that we left the economy in a terrible state.
There are now significant examples of the recovery being under way. The economy grew in the fourth quarter of 2009 and the first quarter of 2010. Retail sales rose by 4.3 per cent in the year to April and manufacturing output rose by 3.3 per cent in the year to March. Interestingly, the OECD forecasts that the UK will achieve faster growth than the eurozone or Japan in 2011. That does not sound like a complete record of failure, as the Government are alleging. I could cite other statistics but, given the time, I shall not. However, one is interesting: company insolvencies are at one-third of the rate that they reached in the recession in the early 1990s. Unemployment is significantly lower than it is in the US or the eurozone and claimant count unemployment is half the level that it reached in the early 1990s recession. On capital gains tax, the Minister has had a lot of sage advice from my noble friends Lord Sugar and Lord Mitchell, so I do not think that I need to expand on it.
I want to emphasise some of the measures that we took. We cut corporation tax to 28 per cent, which is the lowest rate in the G7. We doubled the capital tax allowance to encourage business investment in 2009-10. Contrary to what the noble Lord, Lord Taylor of Warwick, said, the UK has the lowest barriers to entrepreneurship of all OECD countries and, last year, was ranked fifth in the world by the World Bank for ease of doing business. There is clearly a clash of analysis or research here, but I stand by that evidence. From April 2010, the annual investment allowance will be doubled from £50,000 to £100,000, which will provide further incentives for SMEs to invest in their businesses. The enterprise finance guarantee scheme has helped almost 9,000 businesses to access loans totalling more than £900 million. The number of businesses claiming R&D tax credits has continued to rise. The time-to-pay scheme has allowed more than 200,000 businesses, which collectively employ 1.4 million people, to delay more than £5 billion in business taxes on a timetable that they can afford. We introduced the strategic investment fund, which is worth £950 million, to provide investment in advanced industrial projects where specific market failures are preventing otherwise viable developments.
There has been an interesting debate on the value of the Business Link service. I know that my noble friend Lord Sugar feels that there is an opportunity for it to make some savings, but it is providing benefits in advice and training. My noble friend Lady Gould gave examples of the important help that it gives to women. On procuring government contracts, in 2009 we announced that businesses would no longer have to pay a fee to search for government procurement contracts worth up to £100,000. The Labour Government said that they would provide thousands of free business opportunities to SMEs. I noticed that the noble Lord, Lord Sassoon, announced a further development, which is a move in the right direction. We also facilitated the opening in August 2009 of the National Enterprise Academy, the first UK educational institution dedicated solely to enterprise and entrepreneurship. Later that month, we joined forces with the Federation of Small Businesses to offer up to 10,000 graduates internships in small businesses. That is a vital area of co-operation. The Labour Government also reduced the time taken by government to pay its bills from 90 days to 30 days. I would welcome some assurance that the Government will keep moving in that positive direction, because we know that that is another incentive for businesses to embark on government contracts.
I am conscious of the time. I think that I have previously congratulated the noble Baroness, Lady Wilcox, on her appointment, so I shall not reiterate that. Before the election, the parties now in government made quite a lot of noise about how they would assist business, especially SMEs. The test for them now is that they have to deliver.
The Parliamentary Under-Secretary of State, Department for Business, Innovation and Skills (Baroness Wilcox)
My Lords, I congratulate the noble Lord, Lord Sugar, on securing this debate and giving us the opportunity to discuss these issues which are so critical to our country’s future. The noble Lord, Lord Graham of Edmonton, said the most encouraging things about the noble Lord, Lord Sugar; I shall leave that with him because he knows him so well. The noble Lord, Lord Graham, also spoke on behalf of credit unions and the Co-operative movement. I know him to be an expert and passionate supporter of them, and I wonder whether he will be prepared to let me write to him on them more fully after the debate.
Baroness Wilcox
The noble Lord, Lord Sugar, has done a huge amount through his success, his television work and in visits to schools and universities to inspire the next generation of British entrepreneurs and young apprentices. He spoke passionately about apprenticeships, and it is a passion that I share. I still have my father’s apprenticeship deeds as a journeyman carpenter. He eventually became a master cabinet-maker, and I remember how proud he was of that journey and how it prepared him to become the successful businessman that he was and to encourage his son and daughter to train well. Here I stand today, so I am very grateful to him and to the apprenticeship system as it was then.
Our Government has already announced that £150 million cut from the Train to Gain programme will be reinvested to create up to 50,000 new apprenticeship places this year. The Government are determined that small and medium-sized enterprises should be supported in securing apprenticeships, and that is why we intend to introduce an apprenticeship bonus to help small businesses to participate. We also want to overcome other barriers that may make it difficult for such companies to take on apprenticeships, as well as to ensure that the training received is of high quality and brings real benefits to the individuals and to the businesses concerned.
The noble Lord, Lord Harrison, spoke about skilled workers. The ability to think innovatively and entrepreneurially is highly valued by employers, and utilising the skills and ideas of their employees will help all businesses to grow. Skills provision and training need to be accessible, relevant and responsive to the needs of business, and we want to free colleges to be able to respond quickly and flexibly to the skills needed in their communities and to harness the power of sector skills councils to improve skills and qualifications at all levels.
On fostering enterprise and driving growth, as a Government we are ambitious for Britain’s future, but we recognise that the private, not the public, sector is best placed to generate prosperity and jobs. Ultimately, it is Britain’s 4.8 million small and medium-sized enterprises that will lead that recovery. We believe that government can most help those businesses by securing the best possible conditions for their success and then getting out of their way.
We want a rebalanced economy—one built on strong enterprise and balanced, sustainable growth across industries and our country, and not one built, as in the previous decade, on a debt-fuelled spending boom, an inflated housing market and an overleveraged banking sector. That means, first, tough talking and tough measures to tackle Britain’s budget deficit. Next week, the Chancellor will set out in an emergency Budget how we plan to cut the bulk of that debt over this Parliament. Such constructive action is essential to strengthen market confidence, bolster investment and give our entrepreneurs the space they need to start businesses and prosper. To that end, we have already identified and agreed to cut over £6 billion of wasteful spending across the public sector. This is, however, just one—albeit crucial—part of the work that we need to do to sustain our economic growth in the decades ahead.
We want the next decade to be the most entrepreneurial and dynamic in Britain’s history, and we are prepared to start now. We are building the competitive business environment to make it happen, so that Britain’s entrepreneurs can get the support and capabilities they need to start and grow a winning business, without the burden of unnecessary red tape and regulation. The noble Lord, Lord Taylor, talked about keeping life simple. He also talked about black and minority-ethnic entrepreneurs, and I agree with him that we can do more to help those underrepresented groups. That is why we have committed to setting up the targeted national enterprise mentoring scheme for black, Asian and minority-ethnic individuals who want to set up their own business.
The noble Baroness, Lady Gould, talked about women entrepreneurs, which was very pleasant for me to listen to, and I thank her for highlighting their importance. We want to maintain an open dialogue with female small business owners and entrepreneurs to hear directly from them what it is they need, and what they see as the key barriers to starting and growing their businesses—barriers like failure in the education system to build aspiration and skills, the need to promote suitable role models, and problems accessing finance.
In the coalition document we set out our commitment to get banks lending again to viable SMEs. The Government are determined to ensure that the banks, including those part-owned by the state, honour their agreements to supply credit on acceptable terms to SMEs. The noble Lords, Lord Sugar and Lord Taylor of Warwick, both raised the issue of the detail and nature of feedback given to SMEs when their applications for lending are turned down by banks. Currently, in the banks’ lending code, they will offer feedback should applications be rejected on request. In some cases the detail of this feedback is dependent on the size of the business. Smaller companies may get a brief automated response, while larger ones may get more comprehensive information on why their application was not approved. We are working to strengthen the voluntary codes with the banks, and this is ongoing. It is also important that banks recognise the need to rebuild trust and relations with their business customers, as well as continuing improvements to business education on financial matters. We will work with the industry to take that agenda forward.
With regard to the proposed credit adjudicator, we believe there would be serious market implications to the state intervening directly in banks’ commercial decisions, and that would not be appropriate. The creation of this body would also add to a field where professional support from trade bodies, accountants and financial advisers is available to help SMEs access credit. In our consideration of the most effective way to provide support and education to businesses, we will engage with these experts on provision of advice.
The noble Lord, Lord Sugar, spoke about efficiencies of Business Link. I share his view that there are efficiencies to be made in how we deliver business support. No decisions have yet been taken on this; however, the Government’s business support offer needs a rethink. We are prepared to do that and will look to him to help us, if he feels able to do so.
In this context, we must make sure that publicly funded support at all levels is more effective and works in partnership with private sector services. That is why we want to enable local authorities, located in natural economic areas, to work with business to form local enterprise partnerships. In reply to the noble Lord, Lord Corbett, these may cover the same geographical area as an existing RDA if that is what works best in that locality. Equally, however, they may take a different form elsewhere if that is what local business wants. We have an opportunity to create a modern, cost-effective business support system targeted at what business needs. It is a complex issue, however, as those of you who have been in government and have worked through this over the last 10 years will recognise. We need to consider all the options carefully and we will work closely with the business community. We are also in discussion with the RDAs as they continue to deliver existing business support services.
A World Economic Forum report now ranks the UK 84th out of 133 countries in terms of the competitiveness of our tax system, and 86th for regulation. These perceptions stifle good ideas and deter valuable investment and, over the next few months, we will reform our corporate tax system to make it more competitive, simplifying reliefs and allowances, and tackling avoidance to reduce headline rates.
We are already working to stop the most damaging effects of the previous Government’s tax on jobs. In addition, we want to make sure that all eligible small businesses benefit from small business rate relief, and we are looking for practical means to automate this, freeing up SMEs to get on with growing their own businesses. Taxing capital gains made by individuals and trusts helps raise revenue, ensures a fairer tax system, and reduces opportunity for tax avoidance. To be truly effective, however, a CGT system must also encourage enterprise and support entrepreneurship.
For business owners, entrepreneurs' relief provides a CGT rate of 10 per cent up to a lifetime limit of £2 million. This relief covers the vast majority of entrepreneurs in small and medium-sized enterprises. The coalition agreement commits the Government to maintaining generous reliefs for entrepreneurial business activities. Further detail on CGT reform will be provided at the emergency Budget on 22 June. I am obviously not able, therefore, to say more at this stage.
Our Government are also determined to make the UK the fastest place in the world to set up a business. We believe every small business could do more, and grow more, if small business owners did not have to spend so much time on pointless bureaucracy. We are starting a revolution in Whitehall. We are cutting red tape by introducing a “one in, one out” rule for regulations; we are empowering the public to challenge the worst regulations; we are ending the culture of tick-box regulation and, instead, targeting inspections on high-risk organisations. We are establishing a new committee of experts to end unnecessary regulation; we are imposing sunset clauses on regulations and regulators to ensure every regulation is regularly reviewed; we are ending gold-plating of European Union rules so that British businesses are not disadvantaged relative to their European competitors; and we are making it easier to set up a limited company with a new one-click registration process.
It does not end there. We want to open up the opportunities for Britain’s SMEs to sell their goods and services around the world with the support of UKTI, and to enable these companies to win their share of valuable public sector contracts right here at home. We are the first Government to set out an ambition that 25 per cent of government contracts should go to SMEs. We are also going to do whatever we can to make it simpler for more of Britain’s small and medium firms to bid for, and secure, this business.
In conclusion, our commitment to a five-year coalition Government gives us, I believe, the long-term institutional stability necessary to make the right choices about the future for our country. We know what we need to do and what the private sector wants us to do. This Government are focused on restoring balanced, sustainable growth to Britain’s economy and fostering enterprise must be at the heart of our efforts.
I again thank the noble Lord, Lord Sugar, and all noble Lords for their valuable contributions to this important and interesting debate. I have been able to answer only one or two questions in the time allocated to me and I hope that your Lordships will allow me to write in reply to those I have not answered.
Lord Sugar
My Lords, I express my belated congratulations to the noble Baroness, Lady Wilcox, on her new role and I thank her for her comments. If required, I would certainly make myself available to assist in reviewing the future of the Business Link centres. I also thank the noble Lord, Lord Taylor, for reminding me of that excellent example of Reggae Reggae Sauce, and the noble Baroness, Lady Gould, for focusing our attention on the importance of women in business—something I fully endorse.
I would say to the noble Lord, Lord Razzall, if he does not mind, on his comment about people having to put up their houses or give personal guarantees to get loans, why not? If you are not prepared to take the risk on yourself, why should a bank?
We have had a wide-ranging debate on the subject and I am grateful to all noble Lords who have spoken. Time obviously prevents me making further comment, but I am sure that we will return to these matters after the Budget. I therefore beg leave to withdraw the Motion.
Public Expenditure: Review of Commitments
The Commercial Secretary to the Treasury (Lord Sassoon)
My Lords, with the leave of the House, I shall now repeat a Statement made in another place by my right honourable friend the Chief Secretary to the Treasury. The Statement is as follows.
“Mr Speaker, with your permission, I would like to make a Statement on the Treasury’s review of the public spending commitments made by the previous Government between 1 January 2010 and the general election.
In the review, we examined the £34 billion of spending that was approved in their final few months of office. The aim was to test in each and every case whether these commitments are affordable, whether they deliver value for money, and whether they remain genuine priorities for this Government.
This review is now complete. My decisions on these commitments fall into three categories. The first is projects where spending will be approved because they are a high priority or because the money has largely been spent. The second is projects that will be cancelled. The third is projects whose long-term affordability will be considered as part of the wider spending review process over the coming weeks and months. A detailed list of the projects that have been cancelled or suspended until the spending review has been laid in the Libraries of both Houses.
For those projects that offer value for money and meet the Government’s priorities of fairness and responsibility, or for those where it is simply too late to withdraw, we have acted quickly to confirm approval in order to avoid disruption. For example, we have approved the funding for essential medicines in the case of a flu pandemic, for some hospital projects and for support to post offices, as well as spending on crucial equipment for military operations in Afghanistan.
However, the House will be aware that as a country today we have the biggest peacetime budget deficit in our history. We have a choice: we can act fairly, responsibly and decisively now, or follow the approach of the previous Government—deny and delay—which would only end in greater cuts being forced upon us. Given our priority to get the deficit under control, the Government collectively have looked closely at each project. I am grateful for the support of Cabinet colleagues in this process.
Some commitments are simply unaffordable, do not meet government priorities and will be cancelled. We have taken the decision to immediately cancel 12 projects, which would have cost nearly £2 billion over their lifetime. These include, first, the CLG’s regional leader boards; BIS’s loan to Sheffield Forgemasters; DWP’s low-value employment programmes, including the extension of the young person’s guarantee to 2011-12; and the jobseeker’s two-year guarantee. Secondly, they include the Department of Health’s active challenge routes; county sports partnerships; and the North Tees and Hartlepool hospital project. They include, thirdly, the local authority business growth incentive, and, fourthly, the withdrawal of government funding for the Stonehenge visitor centre.
Many of these are difficult decisions and, I fully understand, painful ones for some of the communities affected, whose hopes were irresponsibly raised by the previous Government. But they are decisions that a responsible Government must face up to in these difficult economic times.
There are other decisions which we feel should be weighed up against all other significant pressures on public spending within the context of the spending review—a spending review that the previous Government delayed because they did not want to admit that painful decisions had to be made. For this reason, I can announce that there are a further 12 projects with a total value of £8.5 billion, approved since 1 January, which we will suspend and refer for consideration to the spending review over the coming weeks and months. These include the health research support service; the Kent Thameside strategic transport programme; and the libraries modernisation programme. Any other new major hospital schemes will be assessed in the context of the spending review, to ensure that they are affordable and represent the highest possible value for money. Only the highest priority schemes will be able to go forward.
We will do this in the context of the approach set out in our spending review framework, which will include a fundamental review of all capital investment plans, to identify those areas that will achieve the greatest economic returns. The Secretary of State for Education has already announced that he is looking at the whole Building Schools for the Future programme and will shortly set out the outcome of this work. This programme has been very heavily overcommitted and we are in agreement that tough decisions need to be taken. Government departments have also independently reviewed projects with budgets within delegated limits approved since 1 January. They will report the results of these reviews in due course. Together, these decisions will significantly relieve burdens on departmental budgets that will be under major pressure in the spending review.
While conducting this review, I have discovered yet another black hole in the books that we inherited. I can tell the House that billions of pounds of spending commitments were made for this financial year that relied on underspends or access to the reserve. There was no reason to suppose that underspends would have occurred on anything like that scale and there is insufficient contingency in the reserve to cover the remainder. I will therefore be cancelling at least £1 billion of commitments where there is not the money to pay for them. We will announce the action we take to tackle this further hole in the accounts in next week’s Budget. As far as the reserve is concerned, I am sure the House will agree, our priority is that we keep this for genuine emergencies and new pressures that may result from military operations in Afghanistan.
The previous Government committed to spend money they simply did not have. They made commitments that they knew the next Government could not fulfil and in doing so cynically played politics with the hopes of our communities. The actions I have set out today show that this Government will take responsible spending decisions, which, although sometimes difficult, will be guided by fairness and the overriding need to tackle the deficit. We did not make this mess but we will clean it up.
I commend this Statement to the House”.
My Lords, that concludes the Statement.
Lord Eatwell
My Lords, I am most grateful to the noble Lord for repeating the Statement on spending cuts. I am sure that it was not a happy thing for him to do and I am grateful to him for having done it.
Let us first deal with a major red herring. Everyone is against waste. If some government spending is wasteful, it should be cut. But if it is necessary to maintain overall demand in the economy, the money released should be spent on something useful. Demand really is central to this deficit-and-cuts debate. Businesses need the prospect of growing demand to encourage them to invest and innovate. The falling pound earlier this year stimulated demand for tradable goods, as I remember the noble Lord acknowledged last week.
In 2009, there was a massive withdrawal of demand by the private sector. Households and businesses increased their savings by a whole 10 per cent of GDP in one year. The increased savings could not be channelled back through the financial sector, which was desperately cutting lending to rebuild shattered balance sheets. Fortunately, the Government raised net spending, the deficit, by around 9 per cent of GDP, offsetting much of the decline in private sector demand. But now the Government seem determined to remove demand from the economy.
The central question that the noble Lord must answer is: where then is the demand coming from? It will not come from Europe where Governments are cutting as well. The slide in the pound against the euro has in the past couple of months been reversed. It will not come from households where there is increasing unemployment and the fear of unemployment will tend to increase the savings rate. It will not come from firms. How will the expenditure of firms be stimulated? It will not be by monetary policy. Interest rates can hardly go any lower. Are we to have more quantitative easing? I think not. The question of whether these cuts will simply lead to a decline in output and greater unemployment is central to consideration of the validity of the policy as a whole. Will the Office for Budget Responsibility be publishing an assessment of the impact of these cuts on economic output and employment?
I do not want to go through all the specific cuts set out by the noble Lord, which would be painful for both of us. But the Statement refers regularly to total lifetime cost. What was the discount rate used in the assessment of total lifetime cost?
Turning to the specific cuts, there seems to be an almost obsessive attack on education and skills. Schools for the future, the capital funds of universities and other skills programmes are to be reviewed. It is most extraordinary. We have just had the debate from the noble Lord, Lord Sugar, when the Government asserted their commitment to the development of skills. It is most extraordinary to find that there will be so many cuts in skills.
There are the significant cuts to the MoD search and rescue helicopter programme. Given the emphasis which noble Lords throughout the House have placed on the need for military helicopters—obviously, those in theatre, but also the search and rescue ones which may be released to go to theatre—this seems to be an extraordinary element undermining our Armed Forces.
Finally, as a Wiltshireman, perhaps I may say how sad I am to see that the Stonehenge project has again been abandoned. When will this degradation of one of our greatest national monuments stop? Why are we allowing it to continue?
Lord Sassoon
My Lords, I am grateful to the noble Lord, Lord Eatwell, for the points that he has made. Of course, it is not happy announcing these cuts, but it is absolutely necessary. It is a reflection of the speed with which the new Government have picked up the inheritance that again we are coming forward with a significant review of some of the wasteful spending decisions that were taken in a haphazard and speedy way in the last few months of the previous Government. I do not know whether the noble Lord was listening to his Front-Bench colleague in another place, the former Chief Secretary, but I heard him start his response to this Statement by saying that these cuts were so trivial that they were not worth making. That seems to be rather at odds with the argument of the noble Lord, who says that these cuts somehow are fundamental to how we support demand in the economy. I defer to the noble Lord. I am more of an accountant than an economist, but I am a little confused.
However, the maintenance and growth of demand in the economy are critical to the programme of the new Government. Restoring confidence for businesses and individual savers is at the heart of that. Maintaining low interest rates, supporting the flow of credit to businesses, having a clear path on corporate taxation and reducing the burden of regulation will all be parts of the underpinning of growth and demand. Although the noble Lord runs down the current prospects for the economy, he refers to the depreciation of the pound, which indeed seems to have had a positive effect that is now coming through in much stronger export growth.
The noble Lord asked about the OBR forecasts. As I said earlier in the week, the OBR will publish new forecasts in connection with the Budget next week and will take account of the effects of all decisions made by the new Government up to and including the Budget. He also asked about discount rates used in assessing total lifetime costs. Perhaps I may write to him on that point.
To take the specific cuts in reverse order, the noble Lord talked about Stonehenge. The costs and benefits of this project had to be considered in the light of the current financial picture and the benefit of going ahead with it simply does not at this time justify the costs.
The search and rescue helicopters project is a joint DfT-MoD project, which would deliver a harmonised search and rescue service for the United Kingdom for 25 years from 2012. Given the pressures on public spending, the MoD and DfT intend to conduct a rapid but thorough review of this project. We will continue to work closely with the preferred bidder while this review is taking place.
The noble Lord talked more generally about skills. I can assure him that the combined skills and support for those entering the jobs market is central to the Government’s overall programme. Perhaps I can write a more comprehensive answer for him on that than I can give immediately.
Lord Howarth of Newport
My Lords, we all agree that the UK’s fiscal deficit needs to be reduced, but is there not a crucial issue about timing? If you attack the deficit too fast, you abort recovery. If you deal with it too late, you risk inflation and possibly a downgrading of Britain’s credit rating. What is the reason for the Government’s hasty attack on public spending in an increasingly deflationary global environment? We see Governments withdrawing stimulus all across the world. China is seeking to slow its economy. Germany is deflating. Demand is imploding in the eurozone, which is such a crucial market for our exports. The noble Lord did not answer the question posed by my noble friend Lord Eatwell as to what the sources of growth will be to enable the private sector to drive the recovery of the UK economy. Is not the explanation for the Government’s zeal and impatience in cutting public spending that they are born not of a pragmatic judgment about how to secure sustainable economic recovery for this country but of a doctrinaire determination to cut back the role of the state without proper regard for the state’s own essential contribution to the promotion of innovation, for the quality and reliability of public services, for fairness to the poor and vulnerable in our society and for national self-respect? I strongly endorse the point made by my noble friend Lord Eatwell about Stonehenge. Stonehenge is an emblem of this country. It will be extraordinarily important for us in 2012. The Government’s decision announced today means that we shall present ourselves shoddily to the world.
Lord Sassoon
I thank the noble Lord, Lord Howarth, for his comments, but we really do need to get back to the central point today, which is that the previous Government left us with a series of projects that are unaffordable and in many cases present poor value for money. We need to do this. There are huge pressures on public expenditure, which are going to be looked at in the round through the spending review, but we have to take off the further pressures that have been put on by projects that simply cannot be justified. That will provide us with a much better baseline from which decisions made in the Budget next week and then in the spending round going forward can be taken to protect what really matters—projects that present good opportunities to invest in sustainable growth in the future. That is absolutely central and the announcement today helps to contribute to it.
In the short term, I cannot stress enough that to pay for these projects the previous Government were relying on an assumption that £7 billion of underspend would be made in the current year. That is approximately 1.8 per cent of DEL expenditure, but the evidence of recent years shows that the underspend has been reducing to what is estimated to be less than 1 per cent of DEL in 2009-10. The issue is not whether these projects stack up as value for money but that there is simply no money left to pay for them.
I would like to make a point about Stonehenge. I would hate anyone to be left with the thought that we are somehow abolishing Stonehenge or knocking it down—I see that the noble Lord agrees with that. Of course it would be nice to enhance the visitor centre, but unfortunately this is a project that does not stack up in the current circumstances.
Lord Newby
My Lords, does the Minister agree that probably the most depressing part of this Statement is the issue that he was just discussing—that billions of pounds of commitments relied on underspend or access to the reserve? Was that not a series of decisions which could have been taken only by a Government who knew that they could not win an election and which therefore represents a poison pill for their successors? Can the Minister ensure that, at the time of the Budget, the total component of that expenditure is set out so that we can see what it is? Can he also make sure that all departments understand that, in the future, they simply cannot get away with that kind of sharp practice?
Lord Sassoon
I am grateful to my noble friend Lord Newby. I agree completely with his analysis and that the numbers should be set out. As far as the reserve is concerned, I reinforce my hope that everyone in this House will agree that the reserve needs to be kept for genuine emergencies and new pressures that may result, particularly from military operations in Afghanistan.
Lord Harrison
My Lords, the Minister said that he sees himself as an accountant rather than an economist. I have to confess that I am neither an accountant nor, despite the best efforts of my noble friend Lord Eatwell when he was my director of studies at Cambridge, an economist. All the projects described by the Minister had a past and a present and they would have had a future. In respect of each of them, what exactly are the costs that have been incurred in preparing for them through the tendering processes that have gone on so far? Even more particularly, can he tell us the costs of cancellation and the liabilities that the Government are incurring as a result of these decisions?
Lord Sassoon
My Lords, I think that I can help the noble Lord, Lord Harrison, with those questions. Of the 12 programmes and projects that are being cancelled, nine have costs in the financial year 2010-11 totalling £491 million; the total realisable savings from their cancellation will be £474 million in the same year. From that it can be seen that the difference between the two is less than £20 million. Those are the costs that will either be incurred as a result of cancellation or have already been sunk into the projects. However, the great majority of the money is to be saved, starting in the current year.
Baroness Noakes
My Lords, we should congratulate the Government on taking early and decisive action to deal with the deficit. The Benches opposite seem constantly to want to ignore the deficit and find a reason for not dealing with it. I am proud that our Government are getting on with it. The announcement made by my noble friend today clearly does not deal with the whole of the deficit and we will expect more from the Budget and the Comprehensive Spending Review later this year, but it is a very good start. It will help to restore confidence in our country, which is a key element of restoring growth. That is the most important aspect that we have to work on at the moment.
I have one question for my noble friend, which echoes the point made by the noble Lord, Lord Newby, in relation to the commitments that relied on underspend or access to the reserve. The Statement refers to billions of pounds’ worth of spending commitments made in this way, but goes on to say that £1 billion-worth will be cancelled. I think that my noble friend said that a total of £7 billion was concerned in this way. Why cannot the whole £7 billion-worth of projects be cancelled, because, in the terms of the Statement, there is not the money to pay for them?
Lord Sassoon
I am grateful to my noble friend Lady Noakes for taking us back to what is in fact the basis of this and I share completely her analysis of how important it is to get a grip on the deficit. Let me try to help her with some of the numbers. The total of spending decisions that have been found as a result of this exercise to be unaffordable and bad value for money is £10.5 billion. Those have been put into either the “cancelled” or the “suspended” category. We have cancelled projects with a total value of just under £2 billion, so the rest—approximately £8.5 billion-worth—have been suspended and will go into the process that I have described. I hope that this helps to reconcile the numbers.
Baroness Farrington of Ribbleton
My Lords, will the Minister go into more detail about the cancellation of BIS’s loan to Sheffield Forgemasters and any implications that that may have for future development? Can he also give us a guarantee that, by the time we have the details of the impact assessments, he will be able to tell us what the implications are, in particular for the construction industry and the many small firms that will now not have work to do?
Lord Sassoon
I am grateful to the noble Baroness for that question. On Sheffield Forgemasters, the problem with the loan is simply that it is unaffordable. In the context of tighter resources, we have had to focus support in areas where market failures are clearest and, where we can, we need to look to the private sector and private investment to provide solutions. I know that my right honourable friend the Chief Secretary to the Treasury has spoken to my right honourable friend the Secretary of State for Business, Innovation and Skills about this project and we hope very much that there will be a private sector investment solution.
The noble Baroness made a point about the connection between jobs and investment. There is a particular connection between Sheffield Forgemasters and the nuclear industry and we are of course continuing to support collaborative projects such as the nuclear Advanced Manufacturing Research Centre, which is led by Sheffield University, so we remain absolutely sensitive to the job creation priority to which she referred. She also talked about the construction industry. In respect of all industries, I go back to where we start on this, which is that we have to keep interest rates low and show that we are getting a grip on the deficit. We also have to provide a basis on which the private sector can lead the economy forward.
The Lord Bishop of Ripon and Leeds
My Lords, I want to ask about the implications of the Statement and the philosophy behind it for the voluntary sector, in particular where that sector provides resources, thus fulfilling exactly the requirements of a big society. What reassurance can the Minister give to those of us who develop local projects, such as those for English as a second or other language, using government money alongside voluntary contributions? We have employed people to develop such projects and it is crucial that that contribution is not now wasted through lack of funding at this stage.
Lord Sassoon
I am grateful to the right reverend Prelate for raising that point. I am not aware of any particular projects referred to in the Statement where the co-mingling of voluntary contributions and public money will be affected. However, I will take that point back, consider it and, if there are projects that fall into that category, refer the relevant departments to him so that he can get a specific response. I take his general point that the Government should continue to encourage projects that involve joint public and private funding, whether from the voluntary sector or from other parts of the private sector.
Lord Higgins
My Lords, does the Minister agree that the debate between the two sides on how quickly cuts should be made is largely false? Those of us who have been involved in expenditure cuts know that frequently there is a long time lag between a decision being taken and its having any effect. To the extent that things can be done quickly with regard to the items mentioned today, that is all to the good, but we must recognise that these cuts are bound to be spread over a long period, however quickly we try to do them. On the need for aggregate demand to increase steadily, is he not concerned that, despite quantitative easing, the increase in the money supply has been virtually nil and, in some cases, negative? That will need to be taken carefully into account if we are to have further growth in the economy.
Lord Sassoon
My Lords, I thank my noble friend Lord Higgins for that. He is right: there is a considerable time lag on many expenditure decisions. That is why it is so important to send a signal to the markets—we have comprehensively done so in today’s Statement and in the earlier Statement on the £6 billion-worth of cuts—to show that we are getting on with it. As I explained, the cuts today will save close to £500 million on unaffordable and poor-value-for-money projects in the current year. As to aggregate demand and the money supply, I take his point that the flow of credit to business is critical. I expect my right honourable friend the Chancellor of the Exchequer to refer to that in the Budget next week and to explain how we are driving our policies forward.
Lord Christopher
My Lords, picking up on the point made by my noble friend Lady Farrington, the Minister indicated that the Government are now heavily relying on private investment in projects that have been dropped. My noble friend mentioned Sheffield Forgemasters, about which we have been given little information, but if you are going to rely on the private sector in that area, you are certainly seeking to whip a dead horse. The private sector has not contributed to any significant degree in the specialist steels required in the nuclear industry, in which I have had a past interest; it was deplorable to me to see how much steel was being imported in order for us even to maintain and expand what we had in the nuclear industry. Does the Minister agree that it is right that the public should know how much the Government expect to expend in importing steel instead of making it, how many jobs might have been created that will not now be created, what will be the loss to the local community because this is not being proceeded with and—to take up the point made by the noble Lord, Lord Higgins—whether this decision makes any sense, as the money was going out not this year or next year but progressively over a considerable period?
Lord Sassoon
I thank the noble Lord, but it would be wrong to call Sheffield Forgemasters a dead horse, which I think I heard him say. Sheffield Forgemasters makes some of the largest forgings—
Lord Christopher
I did not say that. I said that if you were to rely on the private sector to fill the gap that you have now created, you would be flogging a dead horse. History shows that to be a reasonable point of view.
Lord Sassoon
I am grateful for that clarification. However, given that Sheffield Forgemasters is one of the very few firms in the world capable of making the largest forgings required to supply critical components to the civil nuclear industry, there is every expectation that there may be a private sector solution out there. I stress the broader point about jobs: we need to underpin the economy on a firm foundation, where the private sector can go forward and create the jobs that we need, whether in steel or many other industries.
Baroness Sharp of Guildford
My Lords, perhaps I may press the Minister a little further about the Stonehenge visitor centre. Stonehenge is a world heritage site and attracts the most visitors within the UK. The current visitor centre is a disgrace. Plans have been under way for a long time and it has taken a long time to get the planning permissions in place, which has now just been achieved. Of the money to be spent, only £10 million is coming from Her Majesty’s Government; the rest is coming from English Heritage and other private sources. Is it really necessary to cancel this now?
Lord Sassoon
I thank my noble friend Lady Sharp. I was at Stonehenge last year and it is clearly one of the most inspiring sites in this country. However, we have to be realistic about the predicament in which the economy has been left by the previous Government. There are certain projects that we simply cannot afford and which do not represent good value for money. The £25 million Stonehenge visitor centre is one that fails the test.
Baroness O'Cathain
Can my noble friend confirm that the Department for Culture, Media and Sport has stated that, if it could get private funding for this, the project would go ahead? This is yet another important area. There is a lot of money sloshing around in the arts world, but it is directed to projects that are not as important as a good visitor centre at Stonehenge. By implication, I am sure that many people thought today that we were going to let Stonehenge crumble way. The stones are wonderful, but we are concerned about access and the visitor centre. It seems an awful lot of money to spend on a visitor centre.
Lord Sassoon
I am grateful to my noble friend Lady O’Cathain for pointing out the pressures within the DCMS budget, as there are within the budgets of other departments. Difficult decisions will have to be made in all departments. This could be a project—I do not know—where there may be a private sector solution.
Banking Reform
The Commercial Secretary to the Treasury (Lord Sassoon)
My Lords, with leave of the House, I shall now repeat a Statement made in another place by my right honourable friend the Financial Secretary to the Treasury. The Statement is as follows.
“With permission, Mr Speaker, I wish to make a Statement on the Government’s plans to reform the institutional framework for financial regulation.
The tripartite system of financial regulation failed spectacularly in its mission to ensure financial stability and that failure cost the economy billions. The British people rightly ask how this Government will stop it happening again. This is why our coalition agreement committed us to reform the regulatory system for financial services in order to avoid a repeat of the financial crisis. Today I would like to set out in detail the changes to the regulatory architecture that will make this possible.
At the heart of the banking crisis was a rapid and unsustainable increase in debt. Our macroeconomic and regulatory system utterly failed to correctly identify the risk this posed, let alone prevent it. No one was controlling levels of debt, and when the crunch came no one knew who was in charge. So we need a macro-prudential regulator that has a more systematic and detailed knowledge of what is happening, not only in individual firms but across the financial system as a whole. Only central banks have the broad macroeconomic and markets understanding, the authority and the knowledge required to make macro-prudential judgments.
We will therefore place the Bank of England in charge of macro-prudential regulation by establishing within the Bank a Financial Policy Committee. We will also create two new, focused regulators: a new prudential regulator under the Bank of England, headed by a new Deputy Governor; and a new Consumer Protection and Markets Authority—the CPMA. All the new bodies will be accountable to Parliament and their remit will be clear, so that never again can someone ask who is in charge and get no answer.
First, we will legislate to create the Financial Policy Committee in the Bank of England. It will have the responsibility to look across the economy at the macroeconomic and financial issues that may threaten stability, and it will be given tools to address the risks it identifies. It will have the power to require the new Prudential Regulation Authority to implement its decisions by taking regulatory action with respect to all firms.
The FPC will be accountable to Parliament in two ways: directly, as is the case with the MPC; and also indirectly, through its accountability to the Bank’s Court of Directors. The governor will chair the new committee. Its membership will include the deputy governors for monetary policy and financial stability, the new deputy governor for prudential regulation, the chair of the new Consumer Protection and Markets Authority, as well as external members and a Treasury representative. An interim FPC will be set up by this autumn in advance of legislation.
Secondly, we will legislate to create a Prudential Regulation Authority—PRA—as a subsidiary of the Bank of England. It will conduct prudential regulation of sectors such as deposit-takers, insurers and investment banks. The PRA will be chaired by the Governor of the Bank of England, and the new deputy governor for prudential regulation will be the chief executive. The deputy governor for financial stability will also sit on the PRA board.
Thirdly, a new Consumer Protection and Markets Authority will take on the FSA's responsibility for consumer protection and conduct regulation. The CPMA will regulate the conduct of all firms, both retail and wholesale—including those regulated prudentially by the PRA—and will take a proactive role as a strong consumer champion. It will have a strong mandate for ensuring that financial services and markets are transparent in their operation so that everyone, from someone buying car insurance to a trader at a large bank, can have confidence in their dealings and know that they will get the protection they need if something goes wrong.
The CPMA will regulate the conduct of every financial service business, whether it trades on the high street or trades in high finance. We need to ensure that this body has a tougher, more proactive approach to regulating conduct, and its primary objective will be promoting confidence in financial services and markets.
The CPMA will maintain the FSA’s existing responsibility for the Financial Ombudsman Service and oversee the newly created Consumer Financial Education Body, which will play a key role in improving financial capability. The CPMA will also have responsibility for the Financial Services Compensation Scheme, but given the important role that it plays in crises, it will work closely with the FPC and the PRA. We will also fulfil the commitment in the coalition agreement to create a single agency to take on the work of tackling serious economic crime that is currently dispersed across a number of government departments and agencies.
Before we set up these new bodies in their permanent form, we will conduct a full and comprehensive consultation process and publish a detailed policy document for public consultation before the Summer Recess. Our goal is radically to improve financial regulation in the UK, strengthening the prudential regime by placing it in the Bank of England and delivering the best possible protection for consumers.
During the period of transition to the new regime, the Government will also be guided by the following four principles: minimising uncertainty and transitional costs for firms; maintaining high-quality, focused regulation during the transition; balancing swift implementation with proper scrutiny and consultation; and providing as much clarity and certainty as possible for FSA, Bank and other staff affected during transition. In order to do this, we will ensure the passage of the necessary primary legislation within two years.
I am delighted that Hector Sants, the current CEO of the FSA, has agreed to stay on to lead the transition and become the CEO of the PRA. He will be supported by Andrew Bailey from the Bank of England as his deputy in the new regulator. This is a strong team to ensure a smooth transition.
The financial crisis has cost taxpayers dearly. The regulatory system needs radical reform to make the sector more stable and stronger. The last Government could not do this because they were caught up in a structure designed by the former Chancellor and Prime Minister. The fundamental flaws in its architecture contributed to the failure in the banking sector and ultimately undermined economic stability. The continuing financial and economic uncertainty across the eurozone strengthens the urgency with which we must equip ourselves with better tools and arrangements to tackle any future financial instability. We have already paid a high price for the previous Government’s failings, and we must do all we can to prevent this happening again. I commend the Statement to the House”.
My Lords, that concludes the Statement.
Lord Eatwell
My Lords, I am once again grateful to the noble Lord for having repeated the Statement made by the Financial Secretary in another place. It is a very useful Statement, since it reveals beyond all reasonable doubt the degree of influence that the Liberal Democrat wing of the coalition has on the development of policy in this area—it is nil.
To assess the importance of this massive institutional upheaval, it is worth reflecting on the earlier upheaval that accompanied the creation of the Financial Services Authority 13 years ago. I was at that time a member of the board of the old Securities and Futures Authority. I later sat on the regulatory decisions committee of the new FSA. I can assure your Lordships that with the best will in the world, and with the talented leadership of Sir Howard Davies, regulatory enforcement was none the less seriously impaired by the transition process itself. Putting together complex institutions with different organisational structures, different pay grades and different employment and management practices, inevitably tends to take the eye off the ball. It took more than two years for the new structure at the FSA to become what could be called fully operational.
There must be a real fear that the same will happen again—at a far more critical time. The DNA of the Bank of England and of the FSA are quite different. The Bank makes one important decision every month; the FSA makes a hundred decisions a day. Has a comprehensive risk assessment been made of the negative impact of the upheaval itself? If so, will the Government publish that risk assessment? Is it planned to unify the employment and management practices of the Bank of England and the new subsidiary? Given that the FSA and the Bank have very different structures—the FSA has a chairman and a chief executive, the Bank has but a governor—what is to be the governance structure of the new organisation? What is the estimated cost to the taxpayer of the creation of the new institutions?
Another important angle from which to assess these institutional proposals is their congruence with the objectives of financial policy. Again, it is worth while looking back to the creation of the tripartite structure. The Chancellor of the Exchequer said yesterday that,
“our plan is to hand over to the Bank of England the responsibility for macro-prudential supervision. That should never have been taken away from it”.
I am sure that the Minister will acknowledge that this statement is rather less than accurate. Will he confirm that, on the day that Lehman Brothers collapsed, around 100 staff were working in the financial stability division of the Bank of England? Will he also confirm that their task was to analyse and manage the stability of the financial markets?
My point, however, is not to pick over the entrails; it is, rather, to emphasise that prior to the crisis, nobody in the Bank, the FSA, the Treasury, the Basel committees or the Federal Reserve was paying sufficient attention to the issue of systemic risk. Now it is universally agreed that macro-prudential regulation and supervision must be a fundamental task of the authorities, and that new macro tools are needed. It is equally agreed that this must require close co-ordination between all aspects, macro and micro, of the regulatory process. However, the nature of that co-ordination must of necessity be a function of the policy to be pursued. Unfortunately, the Government have not as yet presented their policies for macro-prudential regulation. They have not decided what the new tools to be wielded by the authorities will be. In restructuring the institutions before they know what they want them to do, and how they want them to do it, are they not putting the cart before the horse?
I wonder whether the noble Lord will indulge me by allowing me to refer to some other matters raised in the Mansion House speech that he and I discussed yesterday and which are relevant to the future of banking in this country. I refer to the membership of the new Independent Commission on Banking. The noble Lord told us yesterday that the membership,
“will require a well balanced set of skills and experience covering banking, business, competition, consumer issues and regulation”.—[Official Report, 16/6/2010; col. 987.]
In the Mansion House speech last night, the Chancellor announced the membership of the commission. In addition to Sir John Vickers, it comprises an outstanding economic journalist, a former head of Barclays Bank, a former utilities regulator with long, recent experience of the insurance industry, and the man who led the team at JP Morgan that created credit derivatives, one of the main toxic instruments of the recent crisis. They are all distinguished and competent people with wide experience but there is nobody from any business other than financial services—not a single person with recent high-level experience of industry, and hence of the relationship between industry and finance; somebody, for example, from the Engineering Employers’ Federation who has experience of small and medium-sized industry and its financial needs. There is not really a single person with experience of the consumer interest, although I acknowledge that Miss Spottiswoode has been part of the Which? inquiry. Will the Chancellor be making further appointments to the commission to redress the current imbalance?
I return to the main point. The Government have failed to demonstrate the necessity of the extraordinary concentration of powers in one institution announced today. Monetary and fiscal policy will be united once again—not in the hands of elected Ministers, but instead in the hands of unelected officials of the Bank of England. Will the Minister confirm that that is not what he described yesterday as a restoration of powers? It is a major enhancement of powers to levels never experienced in this country before. Britain will now have the most centralised, monolithic financial management structure in the world.
To create this structure will require the replacement, or at least substantial amendment, of the Financial Services and Markets Act. Will the Government follow the good practice of their predecessor and establish a pre-legislative scrutiny committee for the requisite Bill? And when are we likely to have sight of the Bill? This side of the House is as committed as are the Government to the need for regulatory structures that sustain stable and secure financial services for British industry and British families. We remain to be convinced that the proposed upheaval is either necessary or sufficient to achieve that goal.
Lord Sassoon
My Lords, I thank the noble Lord, Lord Eatwell. It feels as if I am having four tutorials in a week, when one was what I was brought up to do. Let me try to take as many of the points as I can.
The noble Lord stresses the transition arrangements. These are very serious issues which we have been thinking a lot about, and my right honourable friend the Chancellor stressed that in his Mansion House speech. I would draw a sharp distinction, though, between what we are doing now and the task that Sir Howard Davies took on originally. He was trying to get somewhere between 10 and 20 bodies together to create the FSA, while here we have principally the Bank and the FSA; and as we explained, the transition will be managed by Hector Sants, who has very generously agreed to stay on and see the transition through. He will be managing that in conjunction with Andrew Bailey of the Bank of England. So I think that the transition will be in the hands of a very strong management team.
The noble Lord referred to the DNA of the Bank. He seems to be talking about DNA in rather a short-term way. As I understand it, DNA can be traced back through the generations over many thousands if not hundreds of thousands of years. I remind him that in this reorganisation of responsibilities we are getting responsibility back to the Bank of England for most of what it historically did throughout large parts of its existence. I would argue that the Bank has the DNA there and that we are putting right a short-term aberration of the past few years.
The noble Lord went on to question, quite properly, the governance and management of the Bank. It will be principally for the two management teams themselves to work out the details of how the management beds down, but it is clear, I hope, that the new PRA, although it will be structured as a subsidiary, will be embedded fully in the management structure of the Bank, reporting up to the governor. I have already said but would like to repeat that thoughts about governance processes will be critical to this. As regards the Financial Policy Committee, there will be reporting based on the MPC’s reporting methodology—direct accountability to Parliament, published minutes and a clear remit from the Chancellor. I absolutely share his view that governance needs to be thought of as part of the process.
As for assessing the costs and risks of the changes, I have said that the Government will undertake a full public consultation process on the plans. Of course, in that connection, we will publish a detailed policy document before the Summer Recess, which will include a regulatory impact assessment in the normal way.
On macro-prudential tools and putting carts before horses, if we took that approach to life we would never make any progress because we would always find reasons why the world was imperfect and we should not go forward. It is absolutely critical that we get a regulatory structure that makes it clear who is in charge. We cannot risk again the experience of the past three years, so we will put in place the FPC, which will be responsible for the macro-prudential judgments. It must have the toolkit, but it is clear from the international discussions at G20 level and in other fora that the emerging toolkit will almost certainly include capital liquidity and, in some role, leverage, and there may be other tools. I am confident that the FPC will not be short of tools.
On the composition of the banking commission, I do not think that my right honourable friend the Chancellor has any intention of adding anybody else to it. However, let me point out one or two things that the noble Lord omitted to say. Martin Taylor, before he was the chief executive of Barclays Bank, ran Courtaulds, a major manufacturing company. He also referred to Clare Spottiswoode. She has been the regulator in other regulated industries, well away from the financial services sector, including, of course, gas. So the experience of the commissioners goes much wider than the noble Lord set out.
The noble Lord then talked about putting more power into the hands of unelected officials, as he put it, in the Bank of England. As I explained, we need to make it clear that there is somebody in charge of taking the decisions. He pointed out that the Bank of England had a significant number of people in its financial stability division in the run-up to the crisis, but the trouble was that they did not have a clear and unequivocal mandate and they had no statutory duty to be responsible for financial stability. Now we will have people in place with a statutory responsibility, which the Bank of England did not have, although the previous Government, in their botched attempt to patch things up, did at last give the Bank a statutory responsibility. They did not have that before the crisis. So we will have somebody in charge—it is the Bank of England, appropriately, and there will be a high degree of accountability, including in the ways that I have laid out.
The Bill was set out in the Queen’s Speech, and it will be introduced in this Session. I am sure that it will follow the normal processes for a Bill of this sort.
Lord Newby
My Lords, our concerns about plans to abolish the FSA in the run-up to the election centred, first, on our concern that the governor was not the person to be in charge of micro-prudential regulation and, secondly, that there would be a long period of hiatus in which there would be no continuity in senior management on financial regulations. We are greatly reassured by the fact that Hector Sants has been persuaded to stay on to deal with the second problem and, given his new position, will be able to deal largely with the first. Can the Minister reassure us that both the Government’s and the Governor’s top priority over the next few months will be to ensure that as many of the senior members of the FSA staff as possible remain in place to work with Hector Sants and to ensure the continuity which everybody thinks is so important?
Lord Sassoon
I am grateful to my noble friend Lord Newby for pointing out, very helpfully, how the Government’s programme in this area has taken account of some of his concerns from before the election. On the transition, it might be helpful if I additionally confirm that the FSA will remain the financial services regulator until the legislation is implemented, so it is quite clear who will be doing what. I am grateful to my noble friend for stressing the management arrangements and I will relay to both the Bank and the FSA his concern that they do what is of course a high priority—to make sure that they retain the essential and extremely good staff they have in both organisations.
Lord Haskel
I thank the Minister for telling us about the regulation of debt and banking, and about taking care of the consumer at the Bank of England. Who will take care of inflation? Will it just be the poor relation, somewhere between the Bank of England and the Monetary Policy Committee, or will it be somebody’s special responsibility?
Lord Sassoon
I am grateful to the noble Lord, Lord Haskel, for raising this rather important question. Let me stress absolutely clearly that the Monetary Policy Committee will continue just as now, with an unchanged remit. It will have, if the Chancellor does not change the remit, the 2 per cent inflation target, and nothing in that respect will change.
Lord Higgins
Could my noble friend clarify the position regarding ministerial responsibility? As I understand it, this Statement was made in another place by the Financial Secretary to the Treasury—an office which I once held a very long while ago. Is he now responsible for the banking side, and how has the situation changed from that under the previous Government, who created a financial secretary for banking? Will my noble friend the Minister assume that role? Could he clarify the overall position? The position was, of course, previously filled by the noble Lord, Lord Myners.
Lord Sassoon
I am grateful to my noble friend Lord Higgins for asking that question. Since I carry the newly-minted title of Commercial Secretary, I can try and explain that my responsibilities straddle both the financial services sector and wider business interests. My friend in the other place, the Financial Secretary to the Treasury, bears the primary responsibility in most areas of financial services policy. If my noble friend would like to look at the Treasury website, he will see a much clearer explanation of the split of ministerial responsibilities. I would be happy to send him a copy.
Baroness Noakes
My Lords, I welcome this Statement and I am sure that the City will welcome the clear directional steer that it was given yesterday. In particular, the staff at the FSA who have been very concerned about what the future would hold for them can now see a clear path forward. The suggestion made by the Benches opposite about pre-legislative scrutiny needs to be looked at very carefully. The Financial Services and Markets Bill indeed underwent pre-legislative scrutiny, but that Bill was a much more complicated matter, bringing together a large number of bodies into a completely new body whereas, as I understand them, my noble friend’s proposals are that the existing FSA will be split into a number of pieces and put into different places.
In addition, notwithstanding that that Bill had pre-legislative scrutiny it did not, as far as I am told by those who bear the scars, save one single minute of time in Committee when all the arguments that went on in pre-legislative scrutiny were re-run on the Floor of the House. I am not at all sure that doing that is a good use of time, but that question is above my pay grade—and, doubtless, above my noble friend’s pay grade.
I have two questions for my noble friend. First, what is to happen to the financial stability committee in the Bank of England, which was created in the Banking Act 2009? It seems to me that we are accumulating rather a lot of committees all over the place with a lot of cross-membership. I wonder whether it will have the same purpose once the financial policy committee is created. Can he also say what is to happen to the UK Listing Authority, one of the functions of the FSA which I do not think was covered in his Statement?
Lord Sassoon
I am grateful to my noble friend Lady Noakes for letting me off from answering her first observation, but I take the point. There are others better equipped than I to know what will be the appropriate way to take this particular legislation through. On the financial stability committee, that was of course introduced by the previous Government as part of their sticking-plaster job, trying to put together something out of the wreckage of the tripartite system. That will fall away when the new structure gets into place. As I have already stressed, the financial policy committee will be up and running in shadow form. It is also important to note that through the transitional period, the Chancellor, the Governor of the Bank of England and the chairman of the FSA will need to be in close discussion regularly. Concerning the UKLA, the Treasury will be bringing forward proposals prior to the Summer Recess on its future, along with the significant number of other matters on which we will consult.
The Earl of Caithness
My Lords, this is my first opportunity to congratulate my noble friend on his appointment to the Front Bench. Whether or not his is a newly-minted position, it is still very good to see somebody in this House on the Treasury Bench. Does my noble friend agree that the current financial crisis started not with the bankers but with the banking system? All that the bankers have done is to use the banking system which was established by judicial review rather than by legislation. In order to combat debt and, as the Statement says,
“to get the best possible protection for consumers”,
can my noble friend update me on the current thinking of the Government about separating deposit and current accounts and returning ownership of a deposit to the depositor, rather than having it in the control of the bank?
Lord Sassoon
I am grateful to my noble friend Lord Caithness. This gives me an opportunity to pay tribute to him as, I think, my predecessor but one representing the Treasury on the Front Bench in this House—a job which he carried with distinction. He makes a very important point on the banking system, one on which we have not touched in detail this afternoon. It is fine and very important to have an appropriate regulatory system but we need to examine the structure of the banking system, something which the previous Government—for reasons that I genuinely fail to understand—did not want at all to look at. That is why we have, yesterday, established the banking commission. There will be many detailed and important points on which your Lordships will want to make direct representations to the commission; the structure of deposit and current accounting might will be one of them.
Viscount Trenchard
My Lords, I also take this opportunity to congratulate for the first time my noble friend Lord Sassoon both on his ennoblement and his appointment, which is indeed excellent news. I believe that there are three of us in your Lordships’ House today who served on the pre-scrutiny committee on the Financial Services and Markets Bill under the noble Lord, Lord Burns, who is in his place. Although I think that the noble Lord, Lord Eatwell, did not share that view at the time—it was 10 or maybe 11 years ago—I recall that there was extensive debate then on whether the FSA was being given too many powers. Certainly, some of us on the committee felt that the FSA should have been in a subordinate position to the Bank of England even from that time. Therefore I welcome the Government’s proposal that financial stability and monetary policy should be combined—in other words, the prudential regulatory functions of the FSA should be either transferred to the Bank of England or made subject to oversight by it. That is indeed a positive move and will help to ensure that there is no doubt in future as to who is in charge.
I ask my noble friend, though, whether there is not some concern about creating too many new quangos—too many new bodies. I see that the FSA is going to be replaced by three bodies: the CPA, the CFEB and the PRA, the rump of the FSA, each with its own board and, to some extent, with overlapping functions. I worry about the cost of these new bodies to the financial services industry. I wonder whether the consumer protection functions could not equally efficiently, or perhaps more efficiently, be taken on by existing consumer protection bodies, such as the one whose name I forget that operates under the business department.
I have a second question. I note the four principles that the Government will be guided by during the transition to the new regime, but might the Government consider adding a fifth—the maintenance of the competitiveness of the City of London as a financial centre? If we fail to do that, it will not be much good for us, however perfect a regulatory system we establish.
Lord Sassoon
I am grateful to my noble friend Lord Trenchard for his warm words. He mentions the question of too many powers under the old regime. I stress that I think it is more a question of the mindset and the regulatory approach rather than the powers themselves; it is the whole approach to regulation that needs to be changed. He raises the important question of whether we are creating too many bodies. I shall try to reassure him on that; indeed, the landscape is being simplified. Although the PRA will be a subsidiary of the Bank of England, it will be fully embedded in the bank structure. In that sense, I do not see that as the creation of a new body. My noble friend draws attention to the CFEB, which was created as a self-standing body but will now come under the auspices of the CPMA. We are creating a much simpler and more efficient structure in the landscape that should not create any additional difficulties.
My noble friend asks about the remit of the CPMA. Although its principal remit will be to ensure that the conduct of business is properly regulated across all markets, the question of secondary responsibilities, which could become primary responsibilities, including the competitiveness of markets, needs to be considered during the consultation process.
Lord Haskel
My Lords, the noble Viscount, Lord Trenchard, reminded me that I too served on the Joint Committee for the Financial Services Act, under the chairmanship of the noble Lord, Lord Burns. I remember that we imposed a duty on the FSA to educate the public about financial matters and financial regulations; indeed, we ring-fenced money so that that could be done. Will all this remain in place?
Lord Sassoon
I ask the noble Lord, Lord Haskel, to be patient with us and, as we get into the detailed design, to see how we deal with all these matters. I take his point that this is another thing that needs to be addressed in the detail of the proposals.
Lord Christopher
My Lords, I apologise to the Minister in advance; I did not register his reply to one of my noble friend Lord Eatwell’s points. Has there been a risk assessment of this, and if there has, is it to be published? It is relevant that there should be one because, as I understand it, nowhere in the world is there a model like the one that is now being created from which we can draw any experience at all. I remind him that the Financial Services Authority requires financial services companies not only to have regularly revised risk assessment reports but to have plans B, C, D and E in the event that the risks appear to be too great.
We have talked about the top brass, but no one has mentioned the staff. Is it going to be an easy matter to integrate them? What discussions will be taking place with them?
Lord Sassoon
The noble Lord enables me to repeat again, for the avoidance of doubt, that we will publish a detailed policy document before the Summer Recess that will include a regulatory impact assessment in the normal way. In preparing the plans for the transition and for the regime thereafter, alternative scenarios have already been, and will continue to be, thought about.
The noble Lord makes an important point about the staff of the FSA. I should take the opportunity to say that the staff of the FSA and of the Bank of England have done an extraordinary job through the very tough conditions of the past few years. I know that the management, led through the transition by Hector Sants and Andrew Bailey on the two sides, are seized of the need to keep the staff fully informed of the transition arrangements, and the noble Lord’s point is well taken.
Chronically Sick and Disabled Persons Act 1970: 40th Anniversary
(13 years, 10 months ago)
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Lord Corbett of Castle Vale
To call attention to the 40th anniversary of the Chronically Sick and Disabled Persons Act 1970; and to move for Papers.
Lord Corbett of Castle Vale
My Lords, it is a privilege to be asked to open this Back-Bench Labour debate. I am just sorry that the remarks I made about that earlier are still not reflected on the Annunciator, but there we go. It is a great pleasure to see so many dedicated, determined and experienced people from all the fields of disability lined up to speak.
Over the past 40 years, the eight pages of the Act have changed the lives of literally millions of people in the United Kingdom and around the world. There cannot be many Members of Parliament who, having come first in a ballot for the restricted time to launch a Private Member’s Bill, can have had such a profound and long-lasting impact. The author of the Chronically Sick and Disabled Persons Act did more than leave a footprint in the sand; he made history. His was the first legislation in the world to enshrine the belief that people with disabilities had rights which should be respected and enforced in law, and to set out a detailed framework of what those rights were and remain. From the bleak, ignored existence of those whom society hid away, this Act offered liberation, recognition and a start on the long road towards equality with all other citizens.
Some might say that this was enough of an achievement—not, however, the father of this Act. He went on in 1974 to gain another first—to become the world’s first Minister for Disabled People. As noble Lords already know, I refer to my much respected noble friend Lord Morris of Manchester, whose determined and passionate commitment has achieved so much over this past 40 years. It was a Labour MP and a Labour Government who put this groundbreaking legislation on the statute book, but I quickly acknowledge that, over the years, others of all political colours and none, in both Houses, have also promoted legislation to bring people with disabilities in from an isolated cold.
The words of my noble friend, in moving the Second Reading of what was then the Bill in another place on 5 December 1969, stand proudly. They are as passionate, dignified and inspirational now as they were 40 years ago. I will not quote the whole of this passage, much as I wanted to, because I suspect at least one other speaker may do so before we have finished, but the ambition he set out for the Bill included that,
“if years cannot be added to the lives of the most severely disabled, at least life can be added to their years”.—[Official Report, Commons, 5/12/69; col. 1863.]
What a beautiful use of language to express such an important, although simple, thought.
The Act unlocked doors which had kept people with disabilities ignored, isolated and unheard. It asserted their fundamental right to be assisted to participate fully in society and, crucially, the ways in which this was to be achieved. The Act required local councils for the first time to listen and talk to people with disabilities about their needs and then—this was the important bit—to set out how they were going to meet them. No longer would young people with disabilities be hidden in long-stay geriatric hospital wards, nor elderly people left, ignored and forgotten, in substandard residential homes. The special educational needs of people who were deaf, blind or dyslexic, or those with degrees of autism, would be acknowledged and met. All buildings open to the public would be, for the first time, just that—open to all of the public, including people with disabilities, with toilet facilities for them.
As opposition disability spokesman, I helped the Labour candidate in Nuneaton in the 1997 election. He put me in a wheelchair and took me round some shops to buy a suit. The first was easy to enter but had two steps in the middle of the shop which were impossible to navigate in a wheelchair. The assistants and manager were more puzzled than anything else by why anybody in a wheelchair should want to buy a suit; presumably, they had not seen people in wheelchairs wearing suits before. We made our excuses and left. The second shop had steps at its entrance, which again made wheelchair access impossible. The third had an almost vertical flight of stairs up to the gents’ suit department on the first floor. The owner, to his credit, offered to bring down some suits for me to try on and then did so. However, this had to be done in the women’s changing cubicle, with him holding the curtains across the back of the wheelchair. The candidate and I explained what we were about. Again, to his credit, the owner acknowledged that he had never even considered access for customers using wheelchairs and would do so.
Ignored and forgotten, in 1970 no one accurately knew how many people there were with disabilities. There was little research into their needs or plans to meet them. It was estimated in that year that there were, perhaps, 1.5 million. A survey in 1996-97 revealed that there were 8.5 million. The scarring offence to people with disabilities—sadly, some of this remains—is that they were told what they could not do, rather than being asked what they could. In my experience, people will often do more than is expected of them, but it makes huge sense to ask them before any decisions are taken.
These assumptions about people with disabilities led to a denial of the right to work where this was possible with assistance from employers. We all know that the ability to work, with training for skills and assistance with adaptations, expands life chances, helps individuals to fulfil themselves and makes society stronger. It adds up to the cement and bricks of community building.
Much is changing in the employment available to people with disabilities. Since 1998, there has been a 10 per cent increase in the number of people at work who have disabilities—up from 38 per cent to 48 per cent in 2008. Nothing must be done by this coalition Government to slow this progress. It is also perhaps a recognition that we should think much more about people with different abilities than people with disabilities.
The previous Government’s Access to Work budget was due to rise by £138 million by 2013-14. Last year, this scheme helped around 32,000 people with different abilities to help or get jobs, assisted in part by the IT revolution. One of the challenges for this coalition Government is to understand the importance to people’s lives and our economic health and prosperity of protecting and promoting the opportunities for people with different abilities to help build our future. I assume from the rhetoric of the coalition’s programme for government that this is what the proclaimed aims of freedom, fairness and responsibility imply. It must be the freedom for people with different abilities to access the new jobs that must be created in our low-carbon economy. Fairness implies that they will get all the access they need to get these jobs. All I can say is that they are ready and willing to take this responsibility.
But it is not only about money. Attitudes towards people with different abilities must continue to change, not least as regards people with learning disabilities and mental health conditions. I said earlier that people with different abilities need assistance to help get them into work to gain dignity and self-respect. We need also to help create and sustain the small and medium-sized enterprises that provide 96 out of every 100 jobs in our economy. People with different abilities deserve and demand their place in this process. Some are doing just that. I was told about a woman in her 40s working as a sales rep, who discovered that she had epilepsy. She was her family's main earner and was anxious about what would happen to her job. At her local hospital, an epilepsy nurse told her how to contact the Government’s Access to Work scheme. Her adviser arranged for her to have a paid driver so that she could keep her job and feed her family. That is why I say that this Government should keep their hands off the Access to Work scheme. There are broader backs who can help than this woman's.
I much applaud the charity, Sports Leaders, and know that many in the House do so. It seeks to change lives by encouraging and motivating young people to create and run sports activities in their communities. In schools, colleges and universities, more than 200,000 people a year, including some in prison, learn how to help their local communities to flourish and grow. For example, Sally Wallace is a school sports co-ordinator who fell badly off her bike and spent six months learning how to adapt to life in a wheelchair. She now lives independently at home, has got her job back and works for Priory Sports and Technology College in Preston and five linked primary schools, helping students to achieve Sports Leadership awards.
Reuben was involved in a hit-and-run car accident, resulting in traumatic brain injury, and spent five months in hospital with cognitive and physical difficulties. After rehabilitation at a brain injury centre, he started a 35-hour, level 2 award in community Sports Leadership. He completed the course, and the 10 hours’ volunteering that went with it, last summer. He now lives independently in sheltered accommodation, and coaches in a local gym and, in his spare time, the local football team. He is now training for the 2012 Paralympics, his goals being the 100 metres and the blind seven-a-side football. As somebody said, it can be done.
Emma is profoundly deaf, worked as a daycare assistant and wanted to get more involved in sports. She attended a five-day Sports Leadership coach course, joining a group of deaf and hard-of-hearing people. Since completing the course, Emma has learnt to use her own initiative when creating and administering training sessions. She organises activities, leads and motivates others and, with the skills gained from the course, has secured a work placement at Ramsgate Leisure Centre, if anybody is passing those doors. These are just some examples of what people with different abilities can achieve when their determination is matched by the assistance that they need, the pathway to which was so well laid by my noble friend Lord Morris.
I mention these people because they illustrate how, with assistance, they can overcome medical conditions and go on to succeed in paid and fulfilling employment. The previous Government planned to guarantee 3,500 places on the Access to Work programmes for people with learning disabilities and mental conditions. I hope that the noble Lord, Lord Freud, will tell me that the Government will honour these plans as part of their fairness agenda. The scaremongering of the Deputy Prime Minister about the severity of cuts needed in public expenditure has been shown to be hollow. The noble Lord, Lord Razzall, who is no longer in his place, does not seem to have understood this either. The truth—which the Office for Budget Responsibility has confirmed—is that borrowing will be £10 billion less than forecast in March by the previous Government, and next year it will be £8 billion less than forecast. That is enough to protect people with different abilities from the impact of savage cuts.
I want to say this clearly—it repeats what I said in my maiden speech in the other House in November 1974—there is no possible reason or excuse to take away assistance from people with different abilities for whom we have the legal and moral responsibility to assist in becoming fully equal citizens. I have no doubt that I carry the House with me on that.
I turn to some of the challenges ahead. The Government’s Office for Disability Issues published Roadmap 2025, which set out plans across government of how it would seek to assist disabled people to achieve equality. It listed 14 steps, but I shall not list them because I do not have time. They aimed for better service provision for disabled children and set aside £370 million to support short breaks for these children and their families. I hope that the Minister can confirm that that money will not be stolen. The Ministry of Justice and the Department of Health are developing plans to help access to mental health services including learning disability services for offenders. This will partially implement the recommendations of the report of my noble friend Lord Bradley to divert offenders with mental health problems or learning disabilities away from prison into more appropriate services.
There is always more to do, but the progress achieved in the past 40 years must have been unimaginable, even to my noble friend Lord Morris when he set out on his journey. Since then, successive Governments and parliamentarians have worked towards equality for people with different abilities, and that mission remains incomplete.
Lord Rix
My Lords, I speak in this debate to celebrate the Private Member’s Bill of the noble Lord, Lord Morris of Manchester, which, with the support of both Houses, became an Act of Parliament some 40 years ago.
As I said during the debate 10 years ago to mark the 30th anniversary of the Bill of the noble Lord, Lord Morris, the years 1970 and 1971 were particularly good for advancing the interests of people with a learning disability and their families and carers. Not only did we have the Chronically Sick and Disabled Persons Act, but we had a White Paper on learning disability, better services, attendance allowance and invalidity benefit, and the Education (Handicapped Children) Act, which ensured the provision of education for children with severe learning disability, who had hitherto been excluded from the education system.
The Chronically Sick and Disabled Persons Act focused on three principles: the identification of disabled people, their involvement and their rights. The Act enshrined in law these very important principles and laid the foundations upon which subsequent legislation in the field of disability has been made.
I am delighted that since the Act’s inception some 40 years ago, significant progress has been made to improve the quality of life for people with a learning disability. I welcome the important steps made in these areas. However, the often stark and shocking reality is that too many people with a learning disability, their families and carers continue to suffer the consequences of prejudice and discrimination as a direct result of their disability.
People with a learning disability want to make the same choices about where they live, how they spend their leisure time and what relationships they want to form, in the same way as everyone else, but all too often are denied the opportunities to do so. Ensuring that the right resources are in place is vital, but on its own this is not enough. People with a learning disability do not want choices and assumptions made for them, but are entitled to expect that they are at the centre when any decisions are made about their future and their quality of life. The Chronically Sick and Disabled Persons Act helped to establish this very important principle.
One area where people with a learning disability continue to suffer from such prejudice and discrimination is employment. At a meeting last week of the All-Party Parliamentary Group on Learning Disability, of which I am co-chair, we discussed this very issue and the ways in which it can be tackled. People with a learning disability are the disabled group most excluded from the workplace. Of those known to social services, there are just 6.8 per cent in paid employment. Even where people with a learning disability do work, it is often for low pay and for part-time hours. Too often, the work carried out by people with a learning disability is described as work experience and does not lead to real pay or a real job. This is despite the fact that many people with a learning disability want to work and can make a significant contribution to the workplace.
Among those who spoke at the recent APPG meeting was Ismail Kaji, who has a learning disability and is a campaigns and media spokesperson for Mencap, the royal society of which I am proud to be the president. He works full time in Mencap’s campaigns and policy department, and indeed I was on the phone with him only this morning. Ismail gave an excellent presentation to all those who were present and spoke with real passion about his personal experiences in relation to achieving paid employment. Without a job, Ismail felt that he was always being told what to do, that he relied on benefits and on other people, and that he did not have control over his life. His search for a job was very hard. He did not receive the help and support that he needed at the jobcentre with things such as CVs and application forms. He found interview questions difficult to understand and found it hard to express himself.
Ismail decided to go to a local college to complete a basic skills course. A Mencap staff member in our employment service came to the college and worked with him to find the right job to fit his needs and skills, as well as helping him with applications and interviews. The outcome was positive. Ismail has now worked for Mencap for 14 years and in the campaigns and policy team for four of those years. His life has changed for the better. His only benefits are tax credits and disability living allowance. Ismail feels that he has control over his life and can take care of his wife and children. He feels an active member of society—something that most people take for granted.
During the APPG meeting, we also received a presentation from Kathy Melling, who is the national employment lead for Valuing People Now, working in the cross-government Valuing Employment Now team. She is also the employability development manager for Kent adult social services. She spoke about the fact that, while 47 per cent of disabled people overall are in paid work in this country, the figure is only 6.8 per cent for people with moderate and severe learning disabilities, rising to about 28 per cent for people with mild learning disabilities.
Kathy also talked about the importance of supported employment, or the place-and-train model, which is widely regarded as the best way to help people with learning disabilities to get and keep jobs. The evidence is that investing in supported employment can lead to cost savings. Work in north Lanarkshire and Kent indicates the potential for savings, in both service costs and welfare benefits, when people move into employment of 16 hours or more per week. The challenge for national and local government is how to bring together the money already in the system—in areas such as day services and education—to ensure that it is spent on things that actually help people with a learning disability to get a job.
The final speaker at the APPG was Jacqui Henderson, who is currently Director of Creative Leadership and Skills Strategies and co-chaired the National Skills Forum inquiry with Gordon Marsden MP. Jacqui talked about the NSF report and emphasised that employability does not depend on qualifications alone. The importance of so-called “soft skills”, such as interpersonal, communication and teamwork skills, which are often valued highly by employers, must not be overlooked and can be of even greater importance when considering people with a learning disability. Work experience and supported employment courses are crucial in helping disabled learners to develop these soft skills. There is a need for more opportunities for learning to take place in the work environment for disabled learners, particularly through the use of supported employment agencies, which, the research found, are currently underfunded.
As your Lordships will be aware from my brief synopsis of the all-party parliamentary group meeting, we covered a great deal and made a positive case on the effective contribution that people with a learning disability can make to the workplace. That is why opportunities for apprenticeships are vital for people with a learning disability.
I welcomed improvements made to the previous Government's Apprenticeships, Skills, Children and Learning Bill, particularly amendments tabled in my name and those of my noble friend Lord Low designed to make it easier for disabled students to take an apprenticeship. The previous Government agreed that they would make entry requirements for would-be apprentices more flexible, with the previous Minister for Business, Innovation and Skills, the noble Lord, Lord Young, accepting my proposal to allow students with learning disabilities to submit a portfolio of evidence to show that they are ready for an apprenticeship. I understand that discussions have already begun with key stakeholders, such as representatives from Mencap and others, and government officials, to work out the practical details of implementing my proposal. Needless to say, I hope these discussions are fruitful for all concerned.
Another amendment to the Bill, accepted by the previous Government, extended the entitlement to an apprenticeship for suitably qualified students with a learning disability up to the age of 25, rather than the previous limit of 18. It is practical steps such as those outlined in the Apprenticeships, Skills, Children and Learning Act that will help to improve opportunities for employment for people with a learning disability.
In conclusion, I have no doubt that much of the progress made in improving the lives of those with a disability over the past 40 years has its origins in the inclusive and empowering agenda first set out in the Chronically Sick and Disabled Persons Act. That Act set the benchmark by which future progress would be judged and I congratulate the noble Lord, Lord Morris, and pay tribute to his success in making sure it was placed on the statute book in the first place and, in 1974, for becoming the first ever Minister for Disabled People. He deserves the grateful thanks of each and every one of us.
Lord Morris of Manchester
My Lords, I am most grateful to my noble friend for doing so much to secure and for having opened this, for me, deeply evocative debate. A parliamentarian with integrity to spare and an abiding commitment to social justice, he made plain again today his concern for the value of things as well as their cost. We first met a week or so after I entered the House of Commons in 1964. He then worked for Farmers Weekly, and I was Fred Peart’s Parliamentary Private Secretary at the then Ministry of Agriculture, Fisheries and Food. He was a trusted friend then, and I am delighted to be calling him my noble friend today.
One of the penalties for longevity in parliamentary life is the loss, by attrition, of so many close and valued colleagues. The longer one survives here, the more colourful and crowded one's gallery of sorely missed friends becomes. Many of the most honoured in my own gallery are those who laboured with me to enact my Chronically Sick and Disabled Persons Bill 40 years ago: the honourable John Astor, David Weitzman QC, Sir Neil Marten, Lewis Carter-Jones, Dr Michael Winstanley and, of course, the late and revered Davina, Lady Darcy de Knayth, among many more.
They were not all of one party. They were of all parties—and of none—but they were all of one mind. What united us was a shared determination that Westminster and Whitehall must no longer be allowed to ignore the rightful claims of long-term sick and disabled people. They must be free to live their lives as normally as possible in their own homes and their own families, to have the same opportunities to contribute to industry and society as everyone else and to receive support based on statutory rights.
Those who helped me to enact the Bill included, first of all, Jack Ashley, who was of inestimable help throughout. I rejoice that we remain in such close fellowship today. That he will be speaking in the debate is heart-warming and I very much look forward to hearing him. Happily Sue, the noble Baroness, Lady Masham, who made her maiden speech in this House in the Second Reading debate on my Bill in April 1970, is also with us to participate in this debate and I am delighted to see her. I know that the noble Earl, Lord Snowdon, very much wanted to be with us today but, sadly, it has proved impossible for him to be here.
For Back-Benchers in the House of Commons, winning first place in the annual Private Members’ ballot is the most coveted prize in the lottery of parliamentary life. That was the prize I won in November 1969, giving me the right to parliamentary time to introduce a Bill of my choosing. Not every honourable and right honourable Member felt that it was fair for me to have won the prize. Even Manny Shinwell, for whom, as a young, new Member I could do no wrong, felt that it was a little unfair. He had been in Parliament since 1922 and told me, “You know, it wasn’t your turn, Alf: you’ve only been here five years”, before adding, “but on reflection, I don’t think that it was mine either, just yet”.
Very few Members have a Bill ready to introduce, which is why some who win the ballot take one off the shelf, fully drafted and complete with offers of help with speeches, secretarial and other support from some well heeled pressure group. While I too had no Bill drafted, I knew what I would do. I was resolved to try to legislate on the problems and needs of long-term sick and disabled people as, in my view, the most deprived and neglected minority in Britain, but more realistically, perhaps, I wanted at least to put that policy area firmly on the parliamentary agenda.
Richard Crossman, then Secretary of State for Social Services, was not best pleased when he heard of my intention. In hard summary, his reaction was that if he had thought that such legislation was needed, he would already have introduced a Bill, not waited for me, with barely five years of parliamentary experience, to teach him social priorities.
Crossman was not alone among Ministers in wanting me to drop the whole idea. The Minister of Education asked me why I proposed to include in the Bill help for people with dyslexia which he said, “simply does not exist”, to which, having heard from a ministerial colleague of his that Treasury officials were describing my proposal as unaffordable, I was provoked to reply: “Then at least you can tell the Treasury that, ipso facto, it won't cost them anything”.
Official reaction to my proposals for helping children who are both blind and pre-lingually deaf and those with autism was no more supportive; so the Bill's prospects looked grim. Indeed, I was told by more than one organ of opinion that I was being overambitious in cramming my Bill with too much legislative change. To have any chance of success, they said, it must be toned down and made more affordable.
It must seem incredible and outrageous now, but from 1945 to 1964, there was no mention in any party manifesto of anything specifically about disabled people. Between 1959 and 1964, there was not one parliamentary debate nor even a single Question on disability. Westminster and Whitehall always had more pressing things to do than to respond to the claims of people with disabilities. The attitude of both was one of serene satisfaction with the status quo.
No one even knew how many disabled people there were in Britain. They were mostly seen or heard only by their families or, if they were in institutions, by those who controlled their lives. Even to talk then of as-of-right cash benefits for chronically sick and disabled people or for their carers was to invite ridicule. Local authority services were wholly discretionary and often non-existent. There were countless disabled people with every kind of moral justice on their side, but no statutory right whatever to vitally needed help.
That was how things were when, against all the odds, my Bill became law in 1970. Those who worked with me to enact it will remember how often and how close we came to disaster but, in the end, it was Dick Crossman's main Bill of that parliamentary Session that hit the rocks, while ours sailed safely by.
The Chronically Sick and Disabled Persons Bill became an Act of 29 sections. It imposed new duties and responsibilities on 12 departments of state and became the model for legislation on disability in countries all over the world. It amended 39 existing Acts of Parliament in the interests of disabled people, including such major statutes as the Public Health Act 1936, the Education Act 1944, the National Health Service Act 1946, the National Assistance Act 1948 and the Housing Act 1957. It legislated also where neither here nor in any other country was there any existing law to amend: for example, its five sections on access for disabled people to the built environment. Claire Tomalin, a steadfast supporter, described the legislation as the Act that made disabled people visible; and that applied worldwide as one country after another adopted its provisions on access to all buildings open to the public, thus changing the lives of countless millions of disabled people.
Official statistics show that, since its passage into law, the Act has helped individually over 60 million people in the United Kingdom, more than our present population. Leaving aside its access sections, the Act provided, among other forms of help, for the world's first statutory provisions for: purpose-built housing for disabled people; adaptations to their homes; practical help in their homes; transport to and from services outside their homes; and the installation of telephones for housebound disabled people living alone. The blue badge scheme of special parking concessions for disabled drivers, of which there are now over 2.4 million beneficiaries, has also been important in increasing outdoor mobility, just as the Act's provision for the world's first Institute of Hearing Research has been of crucial importance globally in developing new help for people who are deaf or hard of hearing. Again, the improvements the Act provided in amending the war pensions scheme have helped countless war pensioners and war widows alike, and their benefits are well recognised by the ex-service community.
Forty years on, I well remember Harold Wilson telling me in the 1970s that there was no cause for me to worry about cuts in help for disabled people when the economy was under such daunting stress and the IMF became involved. He said that his policy would be that “the broadest backs must bear the biggest burden”, and he assured me that since my role was to help people with broken backs, among other severe disabilities, he would go on giving it high priority, and he was as good as his word.
Much apart from being cut, my budget increased, enabling me to legislate for the mobility allowance, the carers allowance and many more new benefits during the crisis. When I left the post of Minister for Disabled People after Labour's defeat in the 1979 general election, I told the House of Commons that there remained a long unfinished agenda of unmet need and, sadly, that is still the case today.
I conclude with the closing paragraph of my speech commending my Bill to the House of Commons on 5 December 1969. I said, Mr Speaker, if we could bequeath one precious gift to posterity, I would choose a society in which there is genuine compassion for the long-term sick and disabled people; where understanding is unostentatious and sincere; where needs come before means; where, if years cannot be added to the lives of the chronically sick, at least life can be added to their years; where the mobility of disabled people is restricted only by the bounds of technical progress and discovery; where people with disabilities have the fundamental right to participate in industry and society according to ability; where socially preventable distress is unknown; and where no one has cause to be ill at ease because of his or her disability.
That is how I explained the Act's purpose and why Marcel Napolitan, who represented disabled people in France with such distinction, called that day “un moment critique” for disabled people across the world. Much the best way of marking the 40th anniversary is to recognise that we still have much more to do to turn humane precept into practice and to make it our bounden duty to meet that challenge.
Baroness Campbell of Surbiton
My Lords, I very much welcome this debate, which recognises the groundbreaking legislation introduced by the noble Lord, Lord Morris, 40 years ago. It presents us with an opportunity to reflect on how we can continue to build on its legacy. When the noble Lord, Lord Morris, took the Chronically Sick and Disabled Persons Bill through the other place, he was a relatively new MP and I was a wee child. I feel like a child now, trying to follow such a wonderful contribution.
The world was a very different place for disabled people in 1970, full of barriers and social prejudice that kept us segregated and excluded. I was a very fortunate child because I would grow up alongside millions of other disabled people to benefit from the provisions of this groundbreaking Act. The noble Lord, Lord Morris, is to many disabled people, including me, what Millicent Fawcett was to women—a visionary leader, who understood how to change attitudes and social policy from within the heart of the establishment, a leader who worked hand in hand with the people for whom he was fighting. In 1970, most disability advocates spoke for disabled people. The noble Lord, Lord Morris, was one of the first parliamentarians really to understand our slogan:
“Nothing about us without us”.
He spoke with us, not for us.
In preparing for this speech, I spoke to disabled people who fought alongside the noble Lord, Lord Morris, to get the Act on to the statute book. One of them will be very familiar to your Lordships: Sir Bert Massie, the former chief executive of RADAR. He said to me that the Alf Morris Act—it was never known as the Chronically Sick and Disabled Persons Act, which was always a bit of a mouthful; we all called it the Alf Act—was a watershed in turning a homogeneous disability culture of handouts and charity into one of entitlement and recognition.
Sir Bert reminded me of the benefits that I inherited from this first major battle for rights in Parliament since the 1940s. It was the first legislation that recognised the existence of autism and dyslexia. It was the first legislation that recognised the importance of buildings and the built environment being accessible to disabled people. It also created the blue badge scheme to enable people to park close to their destination. Finally—and this is very dear to me—it was the first legislation that recognised the desirability of involving disabled people in the decisions that affect our lives. For example, the Act required the appointment of disabled people on a number of government committees. I wish that the Government would remember that now, because we are still not yet there.
Although the Act was groundbreaking, it was not long before disabled people realised that it could be undermined and that there were loopholes and get-outs for people who did not want to comply. It required buildings catering for the public to be accessible, but in the legislation were the words
“in so far as it is … practicable and reasonable”.
As early as 1971, Tesco wanted to build a supermarket on the site of a cinema in Liverpool. The cinema was accessible, but it would have to be demolished. It was proposed to build a new one on top of the supermarket. Liverpool City Council requested that the new cinema should also be accessible, but Tesco and the Cinema Exhibitors’ Association resisted this under the get-out that it was not reasonable or practicable.
That gave a clear message that, even then with a brand-new building, it was acceptable to ignore the access needs of disabled people. It took until the mid-1980s before building regulations were changed to require new buildings to be accessible. It was not until 2004 that the requirement for services to be accessible to disabled people, regardless of the building from which they are provided, became law. Even today, as I know from personal experience, many buildings are still a no-go zone for those of us with mobility impairments. In that sense, the Act is still unfinished business, with a long way to go.
Section 2 of the Act listed a number of services that local authorities should provide for disabled people. When the noble Lord, Lord Morris, became the world’s first Minister for Disabled People in 1974, he made it clear that, if a local authority determined that a person had a need under the provisions of the Act, it had a duty to ensure that that need was met. Local authorities could not use limitations of resources as an excuse not to act. This enabled many hundreds of disabled people to begin planning for independent living. During the late l970s and the early l980s, severely disabled people, who once only had the choice of living in institutions or in their parents’ sitting rooms, began to get local authority support to live independently. Nevertheless, this entitlement to support, enshrined in the Act, was eventually challenged in the courts. Yes, “reasonable and practicable” raised its ugly head again.
The Lord Bishop of Ripon and Leeds
My Lords, I add my gratitude to the noble Lord, Lord Corbett, for sponsoring this debate and to all those who have spoken so far and who will be speaking. I feel humbled to speak in the company of those who have played such a major part in the development of the contribution to our life and society of those who are disabled. I hope that noble Lords are aware of the pride that this House has in all that they have given and achieved for us.
I also want to affirm the major progress made in the years since 1970 and the way in which the “Alf” Act has made it possible for disabled people to enjoy a much greater dignity and quality of life, and to contribute so much to the quality of the lives of those with whom they are involved. Nevertheless, there is a real fear among those who are disabled, their representative organisations and those of us who are in contact with them that the principles of the 1970 Act and the Equality Act, to which the noble Baroness, Lady Campbell, has just referred, will be undermined by the financial pressures of the present situation.
I want to concentrate on the needs of young people—first, those with learning disabilities. Since 1970, there has been a massive improvement in the educational achievement of those with learning disabilities. This perhaps is particularly dramatic in the case of those with autism who are now enabled to contribute so much more massively to our society and our thinking than they were when I was first involved in schools for the autistic in the 1970s.
At the same time, there is increasing concern about the mental health of children and young people with learning disabilities. The 2002 report, Count Us In, demonstrated that young people with learning disabilities are six times more likely to have mental health problems than the rest of the school and college population. Low self-esteem, social isolation and a sense of insecurity continue to lead to severe mental stress. Those findings were confirmed by the 2008 study, What About Us?, also from the Foundation for People with Learning Disabilities working with the Faculty of Education at Cambridge University. The welcome inclusion in mainstream education has not always led to the valuing of disabled children and young people, to their inclusion in student representative groups, in decision-making in their own lives, or the life of the school or college.
In my experience, the pressure for academic achievement can mean a failure to respond to the needs of those with learning disabilities. I hope that there will be a new encouragement to schools, not least through the Ofsted process, to provide better space and opportunities for these students. It is surprising how little is made in many Ofsted reports, and in the reports that develop from them, of the valuing of the contribution made by disabled students in schools. I am aware of a Leeds school, for example, where there has been much debate about its quiet space. Pupils, whether disabled or not, can find respite there from the pressures of their lives. It is a space that is particularly valued by students who are disabled as well as those who are under pressure for whatever reason. There is, however, continuous pressure to requisition the space for what are called “more economically productive purposes”, and the debate is ongoing.
Helping young people to make decisions about their lives and to feel a part of the decision-making structures of their institutions are well developed and welcome parts of school life now, but much still needs to be done for those with disabilities to feel similarly appreciated and supported.
Secondly, I want to highlight the needs of those with multiple disabilities and their families. Again, real progress has been made since 1970, not least in enabling such young people to remain with their parents and siblings in the family home. Nevertheless, I know from pastoral experience in our parishes just how much of a fight there needs to be to achieve proper support for the young disabled and their carers. I can think of a teenager who has, three times in his very short life, gone through the multiple testing process to determine his need for one-to-one support—testing that the noble Baroness, Lady Campbell, just described as “obscenely tough”. He has had to go through it three times because his family moved, and each local authority to which they moved would not accept the assessment of the previous authority. The provision of proper support, demonstrably effective for this young person as for many, takes years to provide—during which he becomes increasingly frustrated and both his educational achievement and health decline. The lack of co-ordination between health and education, the absence, in this case for example, of physiotherapy for years on end, means that we are failing that young person, and that is despite agreement between professionals and parents as to what ought to be done. Continual well intentioned meetings mean that these parents have less time to be with their non-disabled son, and there is no effective provision of respite for them as carers. And this is an articulate, middle-class family, well able to argue its case and with substantial spiritual resources helping them to cope. Life is much harder for many who find that the complexities of our systems simply defeat them.
Into this difficult mix comes the threat of cuts. We are told that everyone, including, maybe, this young person, needs to bear their share of cuts. I hope the Government can make it clear today that those already in pain and under pressure such as I have described will not be required to receive even less opportunity to live fulfilled lives contributing to the community. We remain amongst the richest countries of the world and in our present financial issues we need to remember that. It is immoral for us to fail young people such as this. Many of us are well able to bear a significant share of the cuts rightly pursued by the Government. I am one of them. I do not have detailed knowledge of your Lordships’ financial circumstances, but there are many in the House who, in an economic downturn, can shoulder additional burdens. What we must not do is to increase the pressure on those least able to bear it. I hope the Government will be able to assure us that in the field of disability this simply will not happen.
Baroness Gale
My Lords, I thank my noble friend Lord Corbett for securing this important debate today and for his wonderful opening speech. I congratulate my noble friend Lord Morris of Manchester; it was a privilege to listen to his great speech and I thank him for it. I also thank him for his dedication to the promotion of rights for disabled people throughout his parliamentary career. It is thanks to his pioneering work that those with long-term illnesses have entitlements such as assistance in their own home, equal access to public facilities and even parking permits. The 1970 Act was groundbreaking and changed people’s lives. It placed new obligations on local authorities and helped to transform the way in which the state and society treated some of their most vulnerable people.
I declare an interest as chair of the All-Party Group on Parkinson’s Disease and as a member of the charity Parkinson’s UK. One in eight people in the United Kingdom is affected by Parkinson’s, which is a complex, long-term, degenerative condition and for which there is no known cure. Those affected rely on high-quality health and social care, as well as the right to financial support. With the right care their symptoms can be better managed, their quality of life improved and they can be supported to make an economic contribution to society.
As this is Carers Week, I take this opportunity to pay tribute to the 6 million people who perform the vital task of caring for others. Part of the legacy of my noble friend Lord Morris is recognition of the invaluable role of carers, but now more needs to be done. The All-Party Group on Parkinson’s carried out an inquiry, which I chaired, into access to health and social care services for people with Parkinson’s and their carers. Its findings were published last year and I would like to inform your Lordships’ House of what we found in regard to the role of carers. The report stated:
“Many carers said they were not getting the respite care they needed due to funding restrictions in many areas”.
Denise Maule, a carer providing round-the-clock care for her husband who has Parkinson’s disease and dementia, described in oral evidence to the inquiry how she had eventually managed to access a short period of respite care support after reaching breaking point. However, soon after this period of respite, she was informed by social services that she was no longer eligible despite her need being ongoing. Another carer said:
“It is difficult to put into words the feeling of abandonment and loneliness I feel. Carers have enough to cope with without the constant battle to get some attention for their loved ones”.
Research by Parkinson’s UK has shown that more than half of carers had been caring for five years or more. This is not surprising given that Parkinson’s is a long-term condition. More than half of carers reported that their health had got worse as a result of caring. More than a quarter of carers were worse off financially since becoming a carer. Just under half of carers were not receiving any form of break from their caring responsibilities; even fewer—16 per cent—had any emergency back-up. Seven out of 10 carers were not aware that they were entitled to an assessment of their needs. The lives of carers are therefore one of dedication and love for those for whom they care. They need help and support, and especially respite care.
As the first Minister for Disabled People in 1974, my noble friend Lord Morris of Manchester introduced benefits for disabled people and their carers. I am concerned that the coalition Government plan to retest all those who are on incapacity benefits and that their proposals to change the benefit system may leave people with Parkinson’s and other conditions without the financial support that they need.
Research has shown that many people with Parkinson’s rely on benefits for all or part of their income. Nearly half of people with Parkinson’s of working age are in receipt of incapacity benefit, including 47 per cent of those under the age of 45. Without the right financial support, people with conditions such as Parkinson’s will be unable to live independent lives, which was one of the key aims of the 1970 Act.
Under the heading, “Jobs and Welfare”, page 23 of The Coalition: Our Programme for Government states:
“We will re-assess all current claimants of Incapacity Benefit for their readiness to work”
This could result in people with Parkinson’s and other long-term conditions being wrongly reclassified as capable of work. A lot of these people do work. With the right drugs regime, they can work. However, there are others for whom it would be extremely difficult, and they are very concerned about that.
The assessment for the employment and support allowance introduced in 2008—I know that it was under a Labour Government—has been widely criticised as unfair and inaccurate, especially in terms of fluctuating conditions such as Parkinson’s. The coalition Government have said that they will retest everyone on incapacity benefit immediately and either move them on to ESA and keep testing them yearly or, if the test shows that they can work, move them on to jobseeker’s allowance and programmes to get them into work. I am sure that many—those who may be capable of doing some sort of job—would welcome that, but those jobs have to be available for them. However, if assessments are inappropriate, if assessors are not properly trained and if medical records are not taken into account, those with fluctuating conditions may be wrongly deemed ready for work. People may then be denied the benefits that they rely upon. Many of these issues have already been highlighted by a Parkinson’s UK report, Of Little Benefit and Not Working, which raised serious concerns about the accuracy and fairness of employment and support allowance testing.
However, a great deal has been achieved in the past 40 years. The lives of disabled people and those with long-term conditions have been improved. The Act has ensured that public authorities take responsibility for their well-being, and there has been an increase in equality of access to services. Perhaps above all, we have sought to tackle the stigma attached to those in need of care and support. I hope that the Minister will take note of the great concerns of many people on this matter.
Lord Low of Dalston
My Lords, like other noble Lords, I congratulate the noble Lord, Lord Corbett of Castle Vale, on having secured this important debate. The Chronically Sick and Disabled Persons Act must be one of the most celebrated pieces of legislation in modern times. It was unquestionably a landmark Act. We had had legislation concerning disabled people before, notably on employment, but nothing on this scale or so wide-ranging. Indeed, the speech that the noble Lord, Lord Morris, made in moving the Second Reading of the Bill in another place was included as one of the most historic speeches ever delivered in Parliament in a volume brought out by Hansard last year to celebrate its centenary.
I know that a lot was owed to the Chronically Sick and Disabled Persons Act but, when I had occasion to flick through the Act recently for a celebration of the 40th anniversary of its introduction into Parliament, I was staggered to be reminded of just how much. As we have heard, for the first time local authorities were required to collect basic information about the numbers of disabled people in their area. The Government were required to produce an annual report on progress, with research and development of equipment designed to promote the independence of disabled people. The orange—now the blue—disabled persons’ parking badge owes its origin to the Chronically Sick and Disabled Persons Act, and so does the Institute of Hearing Research. For the first time in statute, separate provision was made for children with autism and acute dyslexia. But of course the Act was centrally concerned with access, services and representation. Indeed, it did much to entrench the very concept of disability itself in public policy and consciousness. It also revealed the consummate parliamentary fixing skills of its author, the noble Lord, Lord Morris of Manchester, to whom I pay my tribute, along with everyone else. As we have had occasion to say close-up recently, it would be no mean feat for a private Member to get a Bill through in the wash-up, but that was exactly what the noble Lord, Lord Morris, achieved in 1970. I have acquired a newfound respect for his skills, but also for his indefatigable energy and commitment in your Lordships' House, as I have watched him campaign for justice for victims of Gulf War syndrome and contaminated blood products. If the Government would not set up an inquiry, undaunted, the noble Lord would simply set one up himself and get the funding for it.
The Chronically Sick and Disabled Persons Act faces two ways. Like the music of Bach, it was in many ways the culmination of an era, rather than the beginning of one. Within a short time of its passage, a new paradigm would be involved, which thought more in terms of rights than welfare and of banning discrimination than providing services. We have come a long way since the Chronically Sick and Disabled Persons Act, and much of the transformation in our thinking is as a result of what the noble Lord, Lord Morris, set in train when he was the world’s first Minister for Disabled People. It all goes back to the Chronically Sick and Disabled Persons Act, which paved the way for many of the changes that we have seen since. The Act has lost none of its relevance, and the services paradigm has never been more important, as local authorities’ social services come under threat as never before. But it is important to look forward as well as back, and today’s debate gives us a good opportunity to ask the new Minister, whom I welcome to his position, how the new Government’s approach to disability issues and policy is shaping up. I have a few questions for him; I do not suppose that he shall be able to answer them all, since the answers to some of them lie outside his department, but it would be good if we could arrange meetings in the near future to follow up on some of the issues that I shall raise in areas where the Minister is unable to provide an authoritative answer this afternoon.
The best summary of the previous Government’s policy, as the noble Lord, Lord Corbett, reminded us, is contained in Roadmap 2025 which, building on the 2005 Cabinet Office report Improving the Life Chances of Disabled People, set out how government departments were working towards disability equality by 2025. It showed how 14 themes prioritised by disabled people combined to make up the total vision of disability equality. These themes also reflected the commitments made in the previous Government’s Independent Living strategy, the United Nations Convention on the Rights of Persons with Disabilities, which the UK ratified last year, and departmental Secretary of State commitments. I suppose that my first question is: does this still represent the Government’s policy? Are the Government willing to pick up this ball and run with it, and can they improve on it?
There is a sense out there that the life chances report, and hence the road map, were not sufficiently attentive to the needs of older people. This is a serious omission, given the association of disability with age and the fact that the population is ageing, and it highlights the importance of getting on with the reform of social care. Our society may not be broken but our social care system certainly is, as the noble Baroness, Lady Campbell, reminded us.
There is also a sense that the road map is lighter on some disabilities than others. Organisations representing visually impaired people—I declare my interest here as a vice-president of the RNIB—certainly feel that more needs to be made of the right to have information made available in accessible formats for people unable to read ordinary print. The Minister will know that, just before the election, we amended the Equality Bill when it passed through this House to strengthen the right to information in accessible formats. I would like to think that the Government would now work with the Equality and Human Rights Commission and organisations representing visually impaired people to ensure that this right is effectively enforced. We also need to maintain the focus on ensuring the availability of textbooks in accessible formats, because children are notoriously ill served in that area at present. The audio description targets for television need to be raised from 10 to 20 per cent and we need a help scheme for the switchover to digital radio, such as there was for television. Ofcom has left the decision on the audio description target to Ministers, so I would very much welcome an opportunity to explain to Ministers why it needs to be raised.
Venturing further afield, will the Government review the reservations which the previous Government entered upon their ratification of the UN convention, as the JCHR has recommended? The so-called equal treatment directive is making heavy weather in Europe. More enthusiastic support from the British Government could make a significant difference to its prospects and would be very welcome—especially in relation to the accessibility of manufactured goods, which can only be secured through European legislation. Similarly, we look to the British Government to support the European Parliament’s extended list of non-exemptible rights under the proposed bus and coach regulation when that comes back to the Council. Coming closer, finally, to the Minister’s own sphere of responsibility, where he might be able to give us some more answers, will the Office for Disability Issues remain as the vehicle for ensuring that disability is mainstream right across Government? There have been rumours that it is under threat.
One area where disabled people have the greatest need is employment, and nowhere is imagination on the part of Government more necessary. We are lucky in having the Minister responding to the debate this afternoon, because he has already brought a great deal of imagination and analysis to bear on the employment problems of disabled people, and it would be very helpful if he were able to respond to one or two questions in this area. How will the pledge on assessing people for access to work prior to a job offer be taken forward, and what plans do the Government have to make sure that employers and disabled people are made aware of this important new right? Will the Minister assure us that the previous Government’s commitment to doubling the Access to Work budget is secure? Any move to cut back spending here would directly undermine the Government’s efforts to move disabled people off benefits and into work.
In terms of supporting the most vulnerable and marginalised groups into work, the Government’s focus on meeting individual needs is very welcome, as are the proposals for differential payments, through which funding will be directed to sustaining in work those with the greatest needs. When can we expect more detail on the new work programme and the future of work choice contracts? How will work choice fit within the overall work programme—assuming, of course that work choice contracts will be progressed?
As the right reverend Prelate the Bishop of Ripon and Leeds has told us, disabled people are anxiously awaiting the Budget next week, with the possibility of cuts in their income through means-testing and restrictions on benefits such as the disability living allowance and attendance allowance. Two-thirds of blind people, for example, are not in work and live on fixed incomes, so their finances are extremely fragile. The Government must honour their pledge—this is a theme that has resounded throughout the debate today—to ensure that the most vulnerable in our society are protected from the sharp reductions in public expenditure that we all know are coming.
Lord Ashley of Stoke
My Lords, it is difficult at this stage in the debate to avoid repetition. Inevitably, much of what I wanted to say has already been said, but I warmly endorse the praise for my noble friend Lord Corbett. I thought that his was a brilliant speech, and he said much of what many Members would want to say.
So far as the powers of the poet are concerned, the noble Lord, Lord Morris, was a marvellous guide and driver, combining the two functions in one set of activities. We are all very grateful to him for his marvellous work on that. The Bill will be a perpetual monument to his hard work in piloting it through all its stages in the House of Commons. In retrospect, that was far more difficult than it appeared—I appreciate that.
Of course, it was a team effort, which was one of the main reasons for the passage of the Bill to an Act. I add my tribute to some of the team players mentioned by my noble friend Lord Morris. In addition to the Labour MPs Lewis Carter-Jones, Laurence Pavitt and Fred Evans, there were Conservative activists who worked extensively, such as John Hannam, Neil Marten, John Astor, John Page, Jim Prior and the late Davina Darcy de Knayth, who my noble friend Lord Morris also mentioned.
We worked harmoniously during the passage of the Bill—there was no friction—and yet I would not want people to think that we were sentimental. One of the problems about disability is that some people tend to speak in dulcet, sentimental terms about the subject. They say, “We support the principle of your Bill but regret we can’t support the Bill itself”. Even the present Prime Minister, David Cameron, fell into that trap. In correspondence with him a few years ago, when I tried to persuade him to support my Bill on independent living for disabled people, he said,
“although we are unable to support your Bill, we fully share your aims and aspirations and would hope to play a constructive role in realising them under a future Conservative government”.
It is good that there is so much good will there, but when it comes to the crunch where do we stand? I will write to the Prime Minister following this debate to ask him how far he has got in supporting those sentiments.
In the course of the Bill we rejected sentimentality and had a tough, hard-edged argument. One of the many achievements of the Chronically Sick and Disabled Persons Act, which is rarely understood, was that it led to the foundation and success of the All-Party Group on Disability. That group has grown in influence over the years. On a personal note, I served on it for 40 years, until I retired a few weeks ago. It is now in the extremely competent hands of the noble Baroness, Lady Campbell, and carries on with its influential and unostentatious work for disabled people.
One of the main achievements of the Act was that it drew attention to the subject of disability, which had hitherto been ignored completely. That meant that disabled people had been ignored as well. The Act became a hallmark and a point of reference that was absolutely crucial to progress. No one can doubt that disability is now a mainstream subject. Plenty of people are determined that it should remain so. Disabled people deserve all the attention that they can get. The Act of the noble Lord, Lord Morris, remains a major contribution to their health and welfare.
Baroness Masham of Ilton
My Lords, I thank the noble Lord, Lord Corbett of Castle Vale, for introducing this debate, and for his excellent speech. This debate is to mark the 40th anniversary of the Chronically Sick and Disabled Persons Act. It is also the 40th anniversary of my becoming a Member of your Lordships’ House. The noble Lord, Lord Morris of Manchester, was in 1970 a Member of Parliament for one of the Manchester constituencies, and was lucky to win the ballot to enable him to introduce the Bill. It took much hard work and persuasion to get the Bill accepted in another place, and the noble Lord must be congratulated on his doggedly determined way of not giving up on such matters.
Looking back over the past 40 years and discussing this Act of Parliament, I am filled with nostalgia. Four of us who were disabled Members of your Lordships’ House made our maiden speeches on that Bill. We all used wheelchairs. A Cross Bench was removed and we became known as the mobile Bench. My sadness is that I am the only remaining Member of that first mobile Bench, all of whom were very close friends of mine. They were Viscount Ingleby, Lord Crawshaw and Baroness Darcy de Knayth, all of whom have sadly died.
The Bill was led in this House by the late Lord Longford. Many amendments were moved in your Lordships’ House and the Bill was improved. We moved amendments such as one requiring that public buildings with access for wheelchairs should be signposted. The Chief Whip from another place used to come through because he was so concerned about the amendments we were discussing. This was the first significant legislation to improve the lives of disabled people. Many people were uneasy about the Bill, as people who do not understand disability fear the unknown. They thought that we were going to change society. Indeed, the Bill did improve society for many people.
Disability covers so many different aspects of daily living that non-disabled people take for granted. A disabled person, who may be a child, can mean a family being disabled if adequate housing and suitable aids—as well as access to public buildings, public lavatories and transport, including trains, airplanes, buses, taxis and ships—are not available. Disabled people using wheelchairs often had to travel in the guards van. The provision of telephones, the recognition of dyslexia and access to places of entertainment were all in the Bill. Now, 40 years on, we have to look forward. Aspects of life have changed. We have a new mobile Bench with other Members of your Lordships' House who are well qualified to provide their knowledge and expertise on many aspects of life.
So much has improved over the years but there is still a great deal to do, and much of it is due to the attitudes of some people. I give an example. In my local village of Masham in north Yorkshire, the chemist’s has a four-inch step with no ramp. Many elderly people with varying disabilities find that step impossible to negotiate without help, but because Masham is not a large town, the chemist was told by the PCT that a ramp was not necessary. That is not satisfactory when many residents and visitors to this most attractive part of Yorkshire have a disability. Legislation is being flouted. I know how hard many Members of both Houses of Parliament worked on this legislation, so it is disappointing when a pharmacist, of all places, takes this attitude.
Many disabled people are living much longer. They are often treated as elderly but their disability is forgotten. When disabled people visit hospitals, they very often find that there is no suitable equipment for their disability. Again, it is often a question of the attitude of staff who need better training about the multitude of different disabilities. Disabled people want to be treated as persons first. However, their disability needs to be taken into consideration and they should be helped when necessary. Police and other professional people need to recognise disability so that unfortunate mistakes do not occur. It is still not possible for disabled people to use many facilities. For example, a passport photograph booth has a fixed stool, so disabled people in a wheelchair have to hunt around to find an accessible booth to have photographs taken for the many passes for which they may have to produce photographs as identification, such as the blue badge scheme.
I visited the mobile X-ray unit in London that takes X-rays of people who may have tuberculosis from among the homeless living in hostels and people in prison. It is a great asset to public health. I was pleased to see that this mobile unit had a lift to enable a person using a wheelchair, or who has difficulty climbing steps, to enter the vehicle. The mobile unit was built in Holland. I was told that the mobile units in Holland all have lifts; not so in the UK. The breast cancer units that travel round all have steps and no lifts. We have a great deal to learn from other countries which remember the needs of their disabled members—sometimes better than us. It can be a major problem for disabled people in a rural area who sometimes have to travel for miles to have a mammogram.
On Tuesday there was a debate on poverty. The Minister, the noble Lord, Lord Freud, said:
“Disabled people are at a substantially higher risk of poverty than non-disabled people. Nearly one in four families with a disabled member live in poverty, compared with less than one in six for families where no one is disabled”.—[Official Report, 15/6/10; col. 947.]
I want your Lordships to know that many disabled people have extra expenses for wear and tear to clothes, extra heating, extra equipment that can be very expensive—such as light wheelchairs to help their carers—special food when needed, and extra help to enable them to lead a normal life if they need help getting up, going to bed, dressing and going to the lavatory. Disability can happen at any time to anyone. They can have an accident which leaves them paralysed, a stroke, a condition such as motor neurone disease, or they are born with a condition which leaves them disabled.
The Chronically Sick and Disabled Persons Act 1970 has helped a great deal, but there is much to do to educate new Members of Parliament, councillors, medical staff and educators to understand the very varied and sometimes complex needs of disability.
Lord Addington
My Lords, I spoke in the debate 10 years ago to celebrate this Act which allowed me to go through the state school system as a dyslexic person. I do not know how many other noble Lords in this Chamber have been directly touched in that way—I suspect that that is the case for many of those who have spoken, if not all. This Act changed the world and it is clear, from listening to those noble Lords who were there at the time, that it scared the living daylights out of everyone who was having their world changed.
Any veteran of these debates, when looking at the issue—I have a little more than two decades-worth—would say, “Wait a minute; we had to discuss that again and again”. As noble Lords have said, people do not like having their lives changed. They say, “We don’t have to do that; it is awfully difficult; oh, you mean there is a reasonableness test; we have better lawyers than you”. I am afraid that such sentiments run through all the debates on this legislation. People in both Houses of Parliament take on these issues, listen to those outside, often have personal experience, enact legislation and then what we are doing is whittled back by those outside who do not want to change. All parties and none have been on both sides of that process. It is a matter of how much better we have become at blocking it off. It is like an ebb and flow. We have gone a long way, but there are always little defeats and there is slowness in implementation.
People usually panic. They say that everything will be terribly expensive. They say: “We can’t do anything; the world will change”. I remember a discussion about wheelchair access within schools. It was said: “How on earth could we possibly have a lift that brings a wheelchair from one floor of a school to another? It would be used only three times a day and not at all in some weeks”. Then you say: “If you buy one that cannot move heavy piles of books and avoid back strain, you really are very dumb”. You carry on in that vein and keep going. You approach the fact that people panic and do not want to change.
Another example is the attitude of organisations. The education issue is the first in which I became involved and is regularly raised. People say: “You mean that our class may have to stop or start five minutes early to get somebody who can’t move very fast into the classroom?”. So no one is allowed to get sick in your classroom, use a loo or occasionally turn up late. They are not supposed to but they do, so you adapt and carry on. I think that this type of thing underpins most of this debate. There is always that fear of the unknown and an unwillingness to change.
The noble Lord, Lord Corbett, described the Trojan horse incident using a wheelchair, getting people to react after a lot of necessary legislation had been introduced. It just goes to show how dumb people are. We have to ask what would happen if the person who wanted to buy the suit went to the shop to buy it. The person in the shop might say, “What do you mean?”, to which the answer would be, “They are going to spend money in your shop. They’re going to give you profits”. The person in the shop would reply, “I hadn’t thought of that”, and would then try to get the idea into his head.
The right reverend Prelate the Bishop of Ripon and Leeds put his finger on many of the driving forces in relation to children, including the fact that a child from a middle-class background does much better out of the system than anyone else. After he had finished his speech, I said in an aside to the right reverend Prelate that I thought the best combination was a lawyer and a journalist. People really do not like tangling with those two, and education systems, shops and local authorities have now learnt to back off.
I turn to the bailiwick of the noble Lord, Lord Freud. The real test lies with people whose backgrounds mean that they do not have that degree of access to the media or legal process at their fingertips. This is nothing new and there is a great deal of consensus about it, but it can lead to those nasty arguments that often break out within parties—we all agree on what should happen but we disagree slightly on how it should come about. It is one of those arguments where there is very little room for manoeuvre, so we tend to go for the eyes and throat.
We also know that huge costs are involved in not dealing with situations at an early stage. My own unlooked-for area of specialisation is dyslexia. We know that there are a lot of dyslexics in prison, but why is that? The answer is that if you fail in the education system and cannot fill in forms to get jobs or money outside, then crime is an option. If you do not come from a middle-class background, you do not have the necessary push or support.
We also know—indeed, today we are agreeing quite a lot with the Bishops’ Benches—that mental health problems tend to occur in the groups that do not have support. As the right reverend Prelate pointed out—and there is no point in denying it— certain people in these groups are more liable to have problems. The fact is that if you have something to be depressed about, you can become depressed more easily. If the education or benefits systems do not pick up the costs of helping these people, then the problems, which can be short term, will often multiply. This issue also relates to aspects of the health service and Prison Service.
With the current Government, there is one bright spot in this process, and it goes back to an initial part of the legislation. I refer to assessments in education. This does not relate directly to the Minister’s department but I think that the idea of departmentalising the whole issue is nonsense. As with many problems in politics, you must look across departments. If all children are assessed to find out whether they have special educational needs, I think that autism and dyslexia will probably come top of the poll, but early identification of other needs will not hurt. Furthermore, even if it is obvious that children have a problem, the fact that it is recorded in the system will help. Can we ensure that this attitude towards carrying out skilled assessments is carried on throughout the whole system? Steps have been taken and, although matters may be better than they were before, they are not good enough yet. I do not directly criticise the Government’s intention, but this will probably not be finished in the lifetime of anyone listening today.
We must carry on. We must ensure that we have a greater understanding of people who have missed an initial opportunity for educational support. Showing an adult who has failed or who has not received support how they can survive would be a realistic step. People can succeed. Intelligent people who are active, lucky and have the right parents and an inspirational teacher can succeed. Ultimately, we will have overcome this problem when someone who is not exceptional or does not have the right parents or a bit of luck by birth or by circumstances succeeds. Although we seem to be closer than we were 40 years ago, we still have a long way to go.
Baroness Thornton
My Lords, I congratulate my noble friend Lord Corbett on introducing this debate. I join other noble Lords in paying tribute to my noble friend Lord Morris for the very many wonderful achievements he has to his name over his long and distinguished career—of course, it is still not over—not least his achievements concerning the subject of today’s debate. It is 40 years since the passing of the first ever legislation for disabled people, the Chronically Sick and Disabled Persons Act 1970. I join my noble friend Lady Gale in saying that I thought that the manifesto read out by my noble friend Lord Morris when he introduced that Bill is as relevant today as it was then.
For the second time this week, I am substituting for my noble friend Lord McKenzie and, like the noble Baroness, Lady Campbell, I intend to address the future. Yet again, I shall be seeking assurances from the Minister that the Government, perhaps in their enthusiasm for downplaying or finding fault with the work of the past 13 years, do not lose sight of the progress which has been made on disability rights, much of which has already been mentioned.
In preparing for this debate, I was sent the link to the transcript of the debate which took place in your Lordships' House 10 years ago, referred to by the noble Baroness, Lady Masham. That was obviously on the occasion of the 30th anniversary of the Alf Morris Bill. I commend it to the Minister if he has not already read it. Some noble Lords who spoke then have also spoken today, including the noble Baroness, Lady Masham, the noble Lords, Lord Ashley, Lord Addington and Lord Rix, whose debate it was and, of course, my noble friend Lord Morris.
Sadly, some who spoke then are no longer with us, such as Lady Darcy de Knayth, who was beloved and respected across this House. In that debate she berated the Government—my noble friend Lord Hunt of Kings Heath was answering the debate—on the proposed reforms in disability benefits. The Minister might want to take heed of the effectiveness of the disability lobby on that occasion. She also spoke about mobility, which had been the subject of her maiden speech 30 years before when the original Bill was discussed in the House. The noble Baroness, Lady Masham, also made her maiden speech in the original debate. It was a debate of enormous significance.
Noble Lords might wish to know that two Earls spoke in that debate, the noble Earl, Lord Snowdon, and Lord Longford. Lord Longford said:
“When I find myself before St Peter in the near future, he may say to me, ‘Did you do any good down there?’ I shall be able to murmur a little bit about the honours I have received. And he will say, ‘I do not want to know about that. I want to know, did you do any good?’ I shall be able to say, ‘I played a small part in helping to carry the Alf Morris Bill through the House of Lords 30 years ago’. He will probably say, ‘OK, you can take a day off purgatory for that’”.
I say amen to that. The noble Earl, Lord Snowdon, reminded the House:
“Fifteen years ago I objected in the strongest possible terms to disabled passengers being shoved into the unheated luggage van with no facilities, not even a lavatory”.—[Official Report, 19/4/00; cols. 737-40.]
I reflect that we have come a great distance. Many noble Lords have ensured that disabled people get treated with dignity and have facilities where they need them. A great deal of progress has been made in the 10 years since that debate. I know from my recent experience as a Minister in this House taking through the Equality Act and the Personal Care at Home Act what an important voice the disability lobby is in your Lordships' House and what a valuable and influential role noble Lords have played in shaping and improving both those Acts, and many before.
The noble Baroness, Lady Campbell, and I shared what I think can be described as a glance when the right reverend Prelate referred to the lack of portability of assessment for the disabled. We got that into the free personal care Bill, but this Government are not enacting it. I urge the Minister to bring forward proposals to this House as soon as possible at least to bring forward that part of that legislation.
It was the Labour Government who legislated to protect people who may be unable to make decisions for themselves under the Mental Capacity Act, which provides safeguards to help people to make decisions about their daily lives and be supported where they need it. It was the Labour Government who gave new rights to disabled people through the Disability Discrimination Act and signed the United Nations convention on the rights of people with disabilities, as was mentioned by the noble Lord, Lord Low. It was the Labour Government who made families with disabled children a priority, with a total of £770 million in new funding for local authorities and primary care trusts to support disabled children and their families, as was mentioned by my noble friend Lord Rix. I join him in urging the Government not to cut that important money.
The Access to Work budget has been increased from £15 million in 1994-95 to £69 million in 2008-09 and £81 million in 2009-10. Access to Work is likely to help about 35,000 disabled people to take up and stay in work in 2009-10. Will it be safe?
The Labour Government introduced free nationwide off-peak travel on local buses for the over-60s and eligible disabled people in England. Will that be safe? We established the Equality and Human Rights Commission to act as a strong and independent champion to tackle discrimination and promote equality for all. Labour in government was determined that the UK should always be a world leader in disability rights, and we legislated to provide protection against discrimination at work while offering new support for people to get into work. We will be carrying forward the campaign to strengthen the rights of disabled people to access to services and work and to be supported to make choices about their lives. Where the Government are also doing that, they will have our support.
The independent living strategy was published in 2008, written jointly with many disabled organisations. It is jointly owned by six government departments and details more than 50 government commitments to deliver choice and control for disabled people. Will the Government be taking forward the independent living strategy and, if so, what progress is being made? Is the disability living allowance to be reviewed? It supports people into work. It is paid to people irrespective of whether they are working. Will the Government honour the previous Government’s commitment, mentioned by the noble Lord, Lord Low, to raise the disability living allowance above inflation this year and, from April 2011, to extend the higher rate of the mobility component of DLA to more than 20,000 severely visually impaired people, allowing them greater freedom to get out and about, either socially or to find work?
As I mentioned, the DWP offers a range of specialist disability employment provision designed to help disabled people with high support needs to find and stay in employment. Remploy will have helped about 10,000 disabled people in 2009-10. What will happen to the new specialist disability employment programme for disabled people with the highest support needs, the work choice programme, which was due to start in October 2010, replacing the specialist disability employment programme? Between 1979 and 1997, the number of people on incapacity benefits trebled and people were left without the support to help them ever return to work. The number of working-age people on employment and support allowance and incapacity benefit is now down by 148,000 since its peak in 2003. What does the future hold for the employment and support allowance?
The Labour Government had planned that, by 2015, £370 million would have been spent on the railways for all schemes to improve the accessibility of our railway stations, including £35 million for immediate improvements to the busiest stations. Will the Government continue to deliver this programme?
We strengthened the Disability Discrimination Act in 2005, fulfilling the then Government's commitment to a comprehensive and enforceable set of civil rights for disabled people, and in 2006 we introduced a duty on public authorities to promote equality for disabled people, known as the disability equality duty. We further strengthened disability discrimination legislation through the Equality Act. The noble Baroness, Lady Campbell, is completely correct. These initiatives take disability rights to another level. The Equality Act imposes a new duty on all public organisations to consider the needs of disabled people and actively to seek to promote equality. It will allow public organisations and businesses to take positive action to diversify their teams, including by appointing a disabled candidate where that candidate is equally as qualified as a non-disabled candidate, if the disabled are underrepresented. I hope the Minister will be able to assure the House that the Government will be enacting all the provisions of the Equality Act in the timescale that was intended.
This has been a wonderful debate, and it is an honour to respond on behalf of the Labour Opposition. I can pledge our continuing determination to extend disability rights and our determination to join other noble Lords across the House to ensure that the Government do not lose momentum and do not slip back.
The Parliamentary Under-Secretary of State, Department for Work and Pensions (Lord Freud)
My Lords, I thank the noble Lord, Lord Corbett, for leading this important debate and all noble Lords who have made valuable contributions today. I consider it a great honour to have the responsibility of closing for the Government among such knowledgeable, committed and powerful champions of disability equality. I very much welcome the opportunity that this debate provides to discuss the new Government’s approach to equality for disabled people. I also pay tribute, as so many others have done today, to the noble Lord, Lord Morris, and to his remarkable determination in bringing his Act—the Alf Morris Act—into being. We have been privileged today to hear a moving, first-hand account of his battle with complacent authority. His unceasing efforts, and the efforts of those who worked with him, brought into being the first legislation, not just in the UK but across the whole world, to recognise the rights of disabled people.
As other noble Lords have highlighted, we have made significant progress since the Act was introduced 40 years ago. We now have a strong disability rights framework, which was most recently extended by the Equality Act 2010 and the UN Convention on the Rights of Persons with Disabilities. This Government are committed to using the UN convention as a driver to achieve equality for disabled people. We are looking at how we can best implement the Equality Act 2010 and we will be making announcements about its implementation in due course.
The Chronically Sick and Disabled Persons Act was also a catalyst to making Parliament more accessible and resulted in many changes, including, as the noble Baroness, Lady Masham, told us, the invention of the mobile Bench, which is so welcome today. There is still more to do before Parliament is truly representative of the disabled population, which is why this Government have committed to introducing extra support for disabled people who want to become MPs, councillors or elected officials.
Since the Act was introduced, we have moved on from a time when disabled people were essentially invisible to society and were hidden or forgotten. We have moved through a long period when disabled people, although finally visible, were treated as objects of pity or charity. Today, the disability equality agenda is part of mainstream discussions and receives the recognition that it deserves. It is an agenda on which, no matter of what political persuasion, we are all determined to make progress.
Despite disabled people’s voices now being recognised and heard, disabled people still remain, in many ways, the objects of society’s benefaction rather than the subjects of their own lives. There are still many disabled people whose day-to-day lives are not within their control. Disabled people remain categorised by labels—even the term “disabled” to me separates them out from the rest of society—rather than being recognised as individuals who deserve the same opportunities as anyone else to succeed.
While preparing for this debate, I was thinking about how, ultimately, we are all seeking happiness or quality of life, a fulfilment that many philosophers argue comes from the ability to contribute, to be fully appreciated for those contributions and to be of value. According to this thinking, not only is society missing out on the value that disabled people can contribute, but we are denying disabled people the fundamental right to lead fulfilled lives. We are denying the right to seek the attributes that lead to happiness and self-worth—attributes such as social interaction, employment, pleasure, income, democratic freedom and meaning, to name a few. For me, the challenge is how we can empower disabled people to make that complete transformation from object to subject and how we can support disabled people to be completely in control of their own lives so that they have the opportunity to be fully involved in a society that recognises them as individuals rather than people defined by disability.
The Independent Living Movement is important here in terms of,
“disabled people having the same choice, control and freedom as any other citizen—at home, at work, and as members of the community”.
Those principles—designed by disabled people themselves—are fully signed up to by this Government. I must pay tribute to the noble Baroness, Lady Campbell, and to the noble Lord, Lord Ashley, who have done so much to champion independent living for disabled people.
Building on independent living, the right to control, introduced through the Welfare Reform Act 2009, will provide disabled people with greater choice and control over their own lives. It will empower them to make informed decisions about how they want to receive the support to which they are entitled. We will be testing the right through trailblazers, which will commence later this year.
A key factor in people having independence is having the chance of employment. The importance of work extends far beyond the financial benefits that it can bring. As my forebear, Sigmund Freud, said:
“No other technique for the conduct of life attaches the individual so firmly to reality as laying emphasis on work; for his work at least gives him a secure place in a portion of reality, in the human community”.
Some noble Lords will recall that he practised what he preached and wrote some of his most powerful work while in the 17-year grip of the cancer that killed him.
We know that work is generally good for people’s well-being, as investigated by Waddell and Burton in their 2006 report Is Work Good For Your Health and Well-Being?. Conversely, long-term worklessness can have negative health effects, particularly for people’s mental health. This is true for disabled people, people with health conditions and people in the wider population. We recognise, however, that not enough people are experiencing the benefits of work. Sickness absence remains high, with around 170 million working days lost to illness in 2008. Over 600,000 people flowed on to incapacity benefits last year. While less than half of all working-age disabled people are in work, almost 40 per cent of disabled people who are not in work would like to be.
Right now, we have a welfare state that divides our society into neat segments where the poorest are left to live a life of helplessness, undermining their self-confidence and breeding social exclusion that splinters families and communities. That is why we are starting a radical programme of welfare reform. We will reassess all current claimants of incapacity benefit on their readiness to work. We will also introduce the work programme by summer 2011, which will offer a single integrated package of support, providing personalised help for everyone who finds themselves out of work, regardless of the benefit they claim.
The support offered through the work programme will be based on individual need rather than on the benefits claimed and will radically simplify the complex array of existing employment programmes. It will be designed to meet the needs of a wide range of customer groups, including disabled people, helping to ensure that those with the greatest barriers to work do not get left behind. I hope it will mean that those who have been left behind, referred to by my noble friend Lord Addington, will get a real second chance through this programme.
The noble Lord, Lord Rix, who has contributed so much in this area, powerfully pointed out how difficult it is for people with learning difficulties to get a job. We recognise that there are some groups of disabled people, particularly people with learning difficulties, mental health conditions, and autism, who face additional barriers to employment and will need additional support to move into, or return to, work. We are quite clear that everyone who can work should get the support they need to get a job, and we remain committed to tackling the particular disadvantages that those groups face in employment and across other areas of life. I would like to take this opportunity to remind the right reverend Prelate the Bishop of Ripon and Leeds that I was proud to make my maiden speech in this House in support of the Autism Bill. I can assure him that we are committed to addressing the needs of people with autism and their families.
We also recognise that some disabled people will not be able to make the move into employment. If people genuinely cannot work, we will make sure they get the unconditional support they need. As I mentioned earlier, one of the main challenges is changing the way society perceives disability, and that includes tackling the prejudice and ignorance that leads to bullying and harassment. One of the most shocking aspects of today’s society is that disabled people are still subject to harassment of the worst kind. All disabled people deserve to be free from bullying, to feel safe in their own communities, and to be able to make their full contribution to society in safety and security. This Government take this issue seriously—which is why we have committed to promoting better recording of hate crimes—in order to work towards eliminating that very destructive barrier to participation in society. The Equality and Human Rights Commission launched an inquiry this week into disability-related harassment, which we welcome and fully support.
One of the concerns expressed by a number of noble Lords, including the noble Lords, Lord Corbett and Lord Low, and the right reverend Prelate the Bishop of Ripon and Leeds, was that the financial pressures we currently face will effectively undermine progress in disability equality legislation. I can only emphasise that it is vital that any budget cuts do not disproportionately affect disabled people. We are committed to championing disability equality across government and we have a Minister for Disabled People.
I must admit that as it is early in the Administration my responses to many of the specific questions will be of a similar nature—that we are looking at the issues and will respond as soon as we can. I will give some dates. One of the issues on which noble Lords wanted assurances was the access to work programme. It was referred to by the noble Lord, Lord Corbett, and the noble Baroness, Lady Thornton. We are committed to supporting disabled people to enter and remain in employment, and we are currently undertaking a review on how best to do that. We expect to announce further details shortly.
The noble Lords, Lord Corbett and Lord Low, asked whether we will keep the road map to disability equality. We are committed to achieving equality as soon as practically possible. The road map is a useful guide which we will want to use. The noble Baronesses, Lady Campbell and Lady Thornton, and the noble Lord, Lord Low, raised social care. We acknowledge that urgent reform of the social care system is needed. It is one of the biggest challenges facing this Government. That is why we plan an independent commission to consider how to ensure sustainable and responsible funding. That will go ahead.
The noble Lord, Lord Low, asked about the work programme and the noble Baroness, Lady Thornton, asked about work choice. We are moving ahead on the work programme at great speed, as noble Lords will have seen from the announcement last week. We plan to have that in place in the first half of next year. Clearly, one of the most complex issues in designing that programme is differential payments. I will commit to bringing information on our progress as soon as it is available. We are planning to make an announcement on work choice reasonably soon.
I will effectively ask for a little time on the question from the noble Lord, Lord Ashley, on support for his Bill on independent living for disabled people. An Oral Question is down for that and I shall leave my noble friend Lord Howe to answer that for the Department of Health next week—I have dodged that one. The independent living strategy was raised by the noble Baronesses, Lady Campbell and Lady Thornton. We are looking at how to bring that forward and we are discussing it with interested parties and across government. That is work in progress.
The noble Baroness, Lady Gale, asked about our plans regarding carers’ allowance. We recognise that 6 million carers play an indispensible role in looking after friends or family members who need support. Clearly, cash benefits play an important part in that, although a minority of carers, around 10 per cent, receive them. We have set out our commitment to simplify the benefits system in order to improve work incentives and to encourage responsibility and fairness. I can assure the noble Baroness that we will carefully consider the needs of carers as we develop our thinking on welfare reform.
The noble Baroness, Lady Gale, also raised the work capability assessment in the context of Parkinson’s. It was developed in close consultation with experts and specialist disability groups. It is kept under review and we are confident that it is working well. We are committed to conducting an independent review of that assessment every year for the first five years and we are currently in the process of commissioning it. We expect the first findings to be reported later this year.
On the concern of the right reverend Prelate the Bishop of Ripon and Leeds about the provision in schools for pupils with special educational needs, we are looking forward to the Ofsted review of the issue which is coming forward this summer, and will respond to it then. The noble Lord, Lord Rix, raised the issue of apprenticeships for those with learning disabilities. It is clear that people with learning disabilities should have fairer access to apprenticeships. It is a priority for the National Apprenticeship Service to improve the number of learners from diverse backgrounds taking part, and both categories will be included; that is, those with learning difficulties and learning disabilities.
In closing, I stress that we are committed to equality for disabled people, to empowering them to have the freedom to control and shape their own futures and to live full and fulfilling lives. We recognise that there is still some way to go, and we do not underestimate that, but today’s debate has highlighted how far we have come on the journey to disability equality. It has underlined the commitment to a fairer, better Britain with equal opportunities for disabled people so that they can be full and valued members of society.
Lord Corbett of Castle Vale
My Lords, I thank the Minister for that response, which I am sure will be welcomed all around the House. He has made some specific and important commitments and I just want to say to him that all who have taken part in this debate, along with many other noble Lords, will be there assisting him to do his very best to make sure that those commitments are carried out. Not the least of those are two that he mentioned several times. The first is to continue to make progress towards full equality. Secondly, and what I most especially welcome, he has taken the point made from all sides of the House that the most vulnerable must be protected from the impact of the cuts that are going to be made.
I have, if I may, a little task for the government Chief Whip. It is a matter of great regret that we have been denied the views of Conservative Back-Benchers in the debate, but I know that there are many on that side of the House who take an interest in these affairs. Over the weekend, the noble Baroness might want to consider whether she should get the naughty bench out and talk to one or two of her colleagues on Monday morning.
At the start of the debate, I said that there was a distinguished and dedicated cast list and I hope that your Lordships will recognise that in no way did I exaggerate. I want to thank all noble Lords who have made the time to take part in what I think has been an important debate. This is a milestone that deserves to be recognised and, again, I pay tribute to my noble and much respected friend Lord Morris of Manchester. Progress has been made and, while we all know that there is a long way to go, I think that we are going to get there. I beg leave to withdraw the Motion for Papers.