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Oral Answers to Questions
(13 years, 1 month ago)
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Joan Ruddock (Lewisham, Deptford) (Lab)
1. What recent reports he has received on the establishment of high-security zones in Sri Lanka.
The Parliamentary Under-Secretary of State for Foreign and Commonwealth Affairs (Alistair Burt)
The number of high-security zones established over recent years has begun to be reduced, but a number still remain, particularly in the north of the country. These zones prevent the return of people to their land. We welcome the reduction in the number of zones, but we are looking for more progress as time goes on.
Joan Ruddock
I am most grateful to the Minister for that reply. Tamils in my constituency are deeply concerned by reports that as many as 60,000 people have been removed from their homes to make way for the military. Does he agree that peace will be possible in Sri Lanka only if the religious, cultural and human rights of Tamils are respected and the “Sinhalisation” of Tamil areas is rejected?
Alistair Burt
I certainly agree with the right hon. Lady about the need to return more people to their land. I was in Jaffna very recently, where I was able to see the damage that had been done over the years of conflict and to speak to some of those who were being resettled. The issue of land rights is very complex, and we have asked the Sri Lankan Government to consider the experience of others as they seek to try to resolve these issues over a lengthy period.
Mr Lee Scott (Ilford North) (Con)
Will the Minister look into reports of atrocities taking place in the north of Sri Lanka, including intimidation, murder, rape and other such crimes?
Alistair Burt
Yes. While I was there, reference was made to an upsurge in crime in December and January; a number of murders had been committed. We raised that with the authorities. Precisely what had sparked it was unclear, but there was no doubt that the atmosphere had been very tense over that period. It is very important that Jaffna returns to something like what it was, and that Tamil people feel part of a renewed Sri Lanka. We look to the Government to make good their promises about reconciliation for the future.
Siobhain McDonagh (Mitcham and Morden) (Lab)
The sad experience of everyone from the Tamil community and those supporting them over the past few years has been that the Government of Sri Lanka are slow to act unless some threat is attached to a requirement for better behaviour. Is there anything that the Minister might do in order to put some sanction behind the words in trying to get the proper things done?
Alistair Burt
I do not think that the right approach is necessarily one of threats, but the Sri Lankan Government are aware of our continuing concern about the speed with which the country is returning to the proper spirit of reconciliation set out by the Government and, for example, whether the lessons learned in the reconciliation commission will properly engage those from outside in an independent manner. Until these things are done, the concerns of Tamils everywhere will not necessarily be settled. Both sides need to be engaged and involved in the process of reconciliation, but we ask the Sri Lankan Government to live up to their public commitments.
Simon Hughes (Bermondsey and Old Southwark) (LD)
Do British and other diplomats, United Nations officials and international non-governmental organisations have free access across the whole of Sri Lanka, and, if not, what will our Government do to try to make sure that that is possible?
Alistair Burt
The short answer is no, they do not. Where there is not free access to rehabilitation camps, for example, the British Government make it very clear that that must be provided, with proper access for NGOs and for others who wish to see them. Progress has been made in this respect. More NGOs have access than in the past, but it is not complete, and the right hon. Gentleman is absolutely right to raise the matter.
Mr David Lammy (Tottenham) (Lab)
2. What recent assessment he has made of the state of relations between the UK and the countries of the Caribbean; and if he will make a statement.
The Minister of State, Foreign and Commonwealth Office (Mr Jeremy Browne)
The Government are committed to maintaining and furthering the excellent relationship that we have with the Caribbean. I visited Barbados, Trinidad and Tobago and Jamaica in January, and the Secretary of State for International Development recently announced a 50% increase in DFID’s bilateral aid funding for the Caribbean.
Mr Lammy
I am sorry to drag the Minister back to the UK. He will recognise that there is concern in the Caribbean that Britain is ceding its relationship with the Caribbean to the United States, and that many young people, particularly where there is growing unemployment, are turning to things such as basketball instead of cricket. Will he say more about air passenger duty, which is imposing high fares on travel to the Caribbean?
Mr Browne
I had the honour of meeting, among others, Sir Garfield Sobers during my trip. I offer the West Indian cricket team best wishes in the world cup, although I obviously hope that England win. On the right hon. Gentleman’s specific point, any announcement on tax will be made in the Budget next week.
Chris Heaton-Harris (Daventry) (Con)
3. What recent assessment he has made of the political situation in Eritrea; and if he will make a statement.
The Parliamentary Under-Secretary of State for Foreign and Commonwealth Affairs (Mr Henry Bellingham)
We are concerned about the denial of basic rights to Eritrean people, particularly the severe restrictions on political, religious and media freedoms. We welcome the progress towards a resolution of Eritrea’s border dispute with Djibouti, but are concerned by its support for opposition groups in Somalia, for which the UN Security Council has imposed strong sanctions.
Chris Heaton-Harris
The Minister well knows that I have a constituent who has been detained without charge in Eritrea and is currently being denied consular access. His wife is very concerned about his whereabouts. I have been told that nobody has seen him for nearly two and a half months. What more can the Government do to help my constituent and his wife?
Mr Bellingham
I share my hon. Friend’s concerns. By denying consular access to four Britons, Eritrea is in gross breach of a Vienna convention. I have summoned the Eritrean ambassador on two occasions and our ambassador in Asmara has made repeated representations to the Foreign Ministry and the Office of the President. So far, there has been no response to our efforts. The Foreign Secretary has instructed all posts worldwide to raise the issue as a matter of priority. We will continue to press for consular access to the men at the highest level.
Mr John Spellar (Warley) (Lab)
I am sure the Minister recognises that stability in Eritrea and across the horn of Africa is vital in the battle against piracy, but there is an immediate crisis. Since the previous Foreign Office questions, a tanker carrying £100 million of oil has been captured by pirates, several seafarers have been murdered, and mother ships are sailing far into the Indian ocean. Last month, The Times reported that the terrorist organisation al-Shabaab has cut a deal with the pirates for a 20% share of future ransoms. What is the Minister going to do about it?
Mr Bellingham
The shadow Minister makes an important point. This is a growing challenge and threat, as is suggested by the facts that he outlines. It is essential that we have tough action at sea, and the UK is leading the international response. We also need a renewed effort to secure detention and prison facilities in neighbouring countries. I therefore urge all countries in the region to play their part in combating this evil.
Graham Evans (Weaver Vale) (Con)
4. What recent reports he has received on the involvement of the Government of Iran with bodies acting as proxies for terrorist organisations; and if he will make a statement.
The Secretary of State for Foreign and Commonwealth Affairs (Mr William Hague)
The latest evidence that Iran continues to supply the Taliban with weaponry is at odds with Iran’s claim to the international community and its own people that it supports stability and security in Afghanistan. That behaviour is completely unacceptable. We continue to condemn Iranian support for groups such as Hamas and Hezbollah, which pursue an ideology of violence that directly undermines the prospects for peace in the region.
Graham Evans
Iran has been a prolific sponsor of terror in Afghanistan against coalition troops. Last week it was reported that 48 mid-range rockets that were intercepted in Afghanistan had been supplied to the Taliban by Iran. What steps are the Government taking to combat shipments of weapons and funds from Iran to terror hot spots around the world?
Mr Hague
There was indeed a shipment of 122 mm rockets and a large amount of ammunition. The fact that it was intercepted and seized by NATO in Nimruz shows that effective measures are being taken. Of course, we cannot be sure how effective those measures are. We assess that Iran is the most significant provider of weapons, training and funding to Hezbollah, as well as supporting the Taliban as this case shows. We have made it clear to the authorities in Tehran that this is completely unacceptable. We will continue to push for full implementation of the UN resolutions that call for the disarmament of these armed groups and prohibit weapons transfers.
Mrs Louise Ellman (Liverpool, Riverside) (Lab/Co-op)
On 10 March, Iran’s supreme leader, Ayatollah Ali Khamenei, said:
“The fake Zionist government is a cancerous tumour”.
What steps are being taken to deal with Iran’s influence on terrorism in Lebanon and Gaza?
Mr Hague
I outlined the steps that are being taken in response to the previous question. The hon. Lady draws attention to another outrageous and unacceptable statement by the Iranian leadership, which is part of a long line of such statements about the state of Israel and other nations in the region. We continue to deliver our protests and to take the practical action I have outlined.
Sir Peter Tapsell (Louth and Horncastle) (Con)
In the context of the very important question of Iran, may I tell my right hon. Friend that in my memory, since the days of Ernest Bevin, I have never known a Foreign Secretary surrounded simultaneously by so many difficult problems? I want to tell him how much I admire the coolness and efficiency with which he is dealing with them.
Rushanara Ali (Bethnal Green and Bow) (Lab)
5. What recent reports he has received on the progress of negotiations between the Government and opposition parties in Egypt; and if he will make a statement.
The Secretary of State for Foreign and Commonwealth Affairs (Mr William Hague)
We welcome the new Prime Minister and his Government in Egypt. Recent Cabinet changes are a promising step towards the reform that many Egyptians have been calling for. We will continue to urge the interim Government, as the Under-Secretary of State, my hon. Friend the Member for North East Bedfordshire (Alistair Burt), did during his recent visit, to build trust with opposition groups and involve them in dialogue as the Government develop their reform plans and the timetable for elections.
Rushanara Ali
Following last week’s debate on UN Women, which recognised the importance of women playing a full part in post-conflict political processes, what is the Foreign Secretary doing to ensure that women are fully involved in the post-Mubarak political and constitutional process as Egypt moves towards what we all hope will be free and fair elections?
Mr Hague
We are looking to assist in Egypt with the development of civil society, political parties and electoral processes, through technical advice and by building links between organisations in Egypt and the UK. That will of course include a great deal of reference to, and experience of, the involvement of women in civil society and politics in this country. That is one way in which we can have a positive influence on Egypt. We cannot dictate how it constructs a democratic political system, but we can be a major influence on it.
Joseph Johnson (Orpington) (Con)
What is the position of the UK Government on the legitimacy of Saturday’s constitutional referendum, given that many opposition leaders including Mohamed el-Baradei and Amr Moussa have called on their supporters to vote no to changes that they regard as something of a charade?
Mr Hague
These things are of course to be decided in Egypt itself. There has been a tremendous chain of events, which led to the revolution in Egypt. The clear aspiration of the people of Egypt is to have not only good economic development but an open and democratic political system. That will mean the holding of elections, and in the view of the interim Government it means the holding of the referendum as well. It is not for us to determine the outcome of that referendum or what questions are put in it, but it is for us to urge that it is properly and fairly conducted. We would certainly encourage the Egyptian authorities to allow international observers to observe the referendum and the subsequent elections.
Mark Durkan (Foyle) (SDLP)
In the UK Government’s diplomatic contribution to current considerations in Egypt and to its future governance, will they have regard to the rights and interests of all minorities there, including Christians?
Mr Hague
Yes, absolutely. The hon. Gentleman raises a vital point. It is extremely important that the development of a democracy and of a more open political system is not accompanied by increased discrimination and the harassment of minorities in Egypt. Although we must respect the fact that we will not be able to ordain what happens in an Egyptian democracy, we can be a positive influence on it, and that is one of the factors that we must try to influence.
Rachel Reeves (Leeds West) (Lab)
6. What recent assessment he has made of the UK’s involvement in the middle east peace process; and if he will make a statement.
The Secretary of State for Foreign and Commonwealth Affairs (Mr William Hague)
The United Kingdom will continue to press for progress on the middle east peace process. The situation across the middle east demands that, and I discussed progress with President Abbas last week. We want to see a resumption of negotiations based on clear parameters supported by the international community: 1967 borders with equivalent land swaps, appropriate security arrangements, Jerusalem as the capital of both states and a just solution for refugees.
Rachel Reeves
In February, the Israeli Government removed two checkpoints from the Nablus area. Last week, a man was stopped outside Nablus with a bag of explosives, and this weekend an Israeli family were murdered. Will the right hon. Gentleman welcome the removal of checkpoints but acknowledge the security risks that such decisions entail when abused by those who do not want peace?
Mr Hague
Yes, absolutely—the hon. Lady is quite right to draw attention to that. Of course, it is good when the security environment improves, but what happened in the Israeli settlement near Nablus at the weekend was absolutely unacceptable. I issued a statement at the time saying:
“The friends and relatives of the family killed in Itamar have my deepest sympathies. This was an act of incomprehensible cruelty and brutality which I utterly condemn.”
Bob Blackman (Harrow East) (Con)
Does my right hon. Friend agree that the atrocity at Itamar makes it even harder for Prime Minister Netanyahu to advance the middle east peace process with the Palestinians, and that Members on both sides of the House should utterly condemn such atrocities?
Mr Hague
I will go part of the way with my hon. Friend. We should condemn that atrocity across the House, as I think all parties do, but we must not let any of the recent events in the middle east allow us to draw the conclusion that it has become impossibly harder to pursue the middle east peace process. Indeed, the wider turn of events in the middle east recently, as well as such acts of great barbarity, underline the need to get on with the peace process, and to give even greater urgency to the search for a two-state solution. I hope that that lesson is drawn by Israeli and Palestinian leaders from the wider events in Egypt and other nations.
Stephen Twigg (Liverpool, West Derby) (Lab/Co-op)
May I join the Secretary of State in condemning the appalling murder of the Fogel family last Friday, and associate the Opposition Front Bench with what he said on the implications for the middle east peace process?
Does the Foreign Secretary agree that lasting peace requires reconciliation between citizens as well as agreements between their Governments? Will he therefore join me in praising the brilliant work of OneVoice Palestine and OneVoice Israel—brave local citizens who are making the case in parallel for a two-state solution?
Mr Hague
The hon. Gentleman underlines what I said—that the condemnation of the killings at the weekend is shared across the House—and he makes the powerful point that peace in the middle east will be built on contact between citizens and civil society as well as on the decisions of political leaders. I certainly join him in congratulating those organisations on their work. We also urge Israeli and Palestinian leaders to make the most of that work and to seize the opportunities in the coming weeks to advance the peace process.
Andrew Percy (Brigg and Goole) (Con)
No doubt the Palestinian Authority has made some genuine progress towards its road map obligations, but has the Foreign Secretary had a chance to assess the role of the Palestinians in inciting the sort of attacks that we saw last weekend?
Mr Hague
I am sure that it is not the Palestinian Authority who incite attacks of that kind, which my hon. Friend might see if he looks at what Prime Minister Salam Fayyad has done to build the attributes of a Palestinian state on the west bank. The last thing he wants is incidents of that kind. Of course, we do not know who incited those events, but I feel confident that it was not the Prime Minister and the President of the Palestinian Authority.
Toby Perkins (Chesterfield) (Lab)
7. What recent discussions he has had with his Hungarian counterpart on priorities for the Hungarian presidency of the Council of Ministers of the EU.
The Minister for Europe (Mr David Lidington)
My right hon. Friend the Foreign Secretary held a bilateral meeting with Foreign Minister Janos Martonyi on 7 December in London. I speak regularly to the Hungarian Europe Minister, Eniko Gyori, at meetings of both the General Affairs Council and the Foreign Affairs Council, and most recently by telephone on 20 January, when we discussed energy policy and innovation priorities.
Toby Perkins
In February, the UK announced more job losses than any other country in the EU. In that context, what conversations has the Minister had with other EU Ministers to assist the UK Government in developing a plan for jobs and growth to replace their current strategies, which undermine both?
Mr Lidington
We have taken the lead at many meetings of EU Ministers in arguing that Europe should indeed give the highest priority to growth and global competitiveness, which means more work to complete the single market, to increase free trade with other parts of the world, and to cut the cost and complexity of the regulations that Europe imposes on European businesses.
Miss Anne McIntosh (Thirsk and Malton) (Con)
Just as the Czech spring presaged the rebirth of democracy and liberty in what were known as the eastern European countries, can we hope that the European Union, particularly the Hungarian presidency, can shine a light on those undergoing similar revolutions now in the middle east and adjoining countries?
Mr Lidington
We very much hope so. My right hon. Friends the Foreign Secretary and the Prime Minister have been playing a leading part in those discussions at European level. We think it is time for the EU to carry out an urgent and comprehensive overhaul of its partnership policies with regard to the southern Mediterranean counties. We need to link those much more closely to economic and political reform in that region.
Keith Vaz (Leicester East) (Lab)
One of the priorities of the presidency must surely be the securing of the EU border. Has the Minister had any discussions with the Hungarian Foreign Minister about the deployment by Frontex of a rapid border intervention team—RABIT —on the border between Greece and Turkey? He will know that 90% of illegal immigration comes through that border, and we need to ensure that the RABIT force is protected and extended, in order to give Greece as much support as possible.
Mr Lidington
The right hon. Gentleman makes an important point. There are real problems on the Greco-Turkish border that affect migration into the whole of the EU. This is a matter to which my right hon. Friend the Home Secretary and my hon. Friend the Minister for Immigration are giving a high priority in their conversations with their European counterparts.
Mr David Ruffley (Bury St Edmunds) (Con)
8. What recent discussions he has had in the General Affairs Council on economic prospects for the EU; and if he will make a statement.
The Minister for Europe (Mr David Lidington)
I regularly take part in such discussions and emphasise our view that growth and global competitiveness should be the EU’s first priority.
Mr Ruffley
Will the Minister confirm that if the UK was ever to be pressured to join the European stability bail-out mechanism, it would require a treaty change, and that therefore a referendum would be given to the British people on that subject?
Mr Lidington
Membership of the proposed permanent European stability mechanism is open only to those countries that are members of the euro and have that as their currency. For the UK to join the euro, which would be necessary to take part in the ESM, there would have to be a referendum, provided that the European Union Bill becomes law.
Kelvin Hopkins (Luton North) (Lab)
It is clear that some members of the eurozone are unlikely to be able to sustain membership in the long term, but it is unlikely that member states of the eurozone would suggest such a thing. However, Britain would be well placed to suggest that those countries should be given the chance to leave the eurozone and recreate their national currencies.
Mr Lidington
It is up to the elected Governments of individual countries to decide how to respond to the hon. Gentleman’s challenge. However, it is very much in the UK’s national interest that the eurozone finds a way to overcome its present problems and achieve financial stability and economic growth.
Mrs Anne Main (St Albans) (Con)
The previous Minister for Europe gave away £7 billion of our rebate. Was he sold a pup, or is the current Minister for Europe able to claw something back from that spendthrift way of spending our money?
Mr Lidington
I think that the previous Minister for Europe was sold a pup, although he was not helped by the fact that at the time his Chancellor and Prime Minister were not talking to each other, even about the figures that they used in those negotiations. I can assure my hon. Friend that in the negotiations on the new multi-annual financial framework, the Government will defend the British rebate, which we believe remains completely justified.
Mr Wayne David (Caerphilly) (Lab)
Given the importance of the eurozone to Britain, what are the Government doing to ensure that Britain is not excluded from decision-making processes that will have a direct impact on our economy?
Mr Lidington
We are ensuring that we engage fully on a bilateral basis with those of our partners who are members of the eurozone and with the European institutions. We also remain in regular contact with EU member states that are not part of the eurozone. I find, from talking to eurozone and non-eurozone members alike, that there is a common acceptance of and support for the participation of the UK and other non-eurozone members in discussions and decisions about the single market and the direction of European economic policy. There is no wish to relegate us to a side room.
David Tredinnick (Bosworth) (Con)
9. What recent steps he has taken in response to the political situation in Libya; and if he will make a statement. 11. What recent steps he has taken in response to the political situation in Libya; and if he will make a statement.
The Secretary of State for Foreign and Commonwealth Affairs (Mr William Hague)
The UK is at the forefront of the international effort to isolate the Gaddafi regime, deprive it of money and ensure that anyone responsible for abuses is held to account. We have taken swift action in the United Nations Security Council and the UN Human Rights Council. At the European Council on Friday, EU leaders called on Gaddafi to relinquish power. They agreed to examine all necessary options to protect the civilian population. I have just returned from the G8 meeting of Foreign Ministers in Paris, where we agreed on the need for urgent consideration in the United Nations Security Council of a wide range of additional measures to protect the Libyan population from attack.
David Tredinnick
With a view to Benghazi, does my right hon. Friend recall the fate of the Marsh Arabs in Iraq who were encouraged to revolt and then left to their fate when Saddam Hussein butchered them? What is my right hon. Friend going to do if compliance with the no-fly zone proves to be impossible. Is he happy at the thought that Benghazi will be left to its own devices?
Mr Hague
Yes, we are very conscious of what has happened on previous occasions. The Gaddafi regime has shown its willingness to strike back without compunction at its own civilian population and its ability to take back territory from people who have rebelled against his oppressive regime. That is why, as my right hon. Friend the Prime Minister said yesterday, time is of the essence. That is why we have urged colleagues in the G8 and elsewhere to agree to further urgent considerations at the United Nations Security Council. Anything we do must, of course, have a clear legal base and widespread international support, so my hon. Friend must consider things in that light.
Glyn Davies
Does my right hon. Friend have confidence in the sanctions currently in force against Libya? What discussions is he having with allies about how to strengthen those sanctions against Gaddafi and his regime?
Mr Hague
We have widened the restrictive measures against individuals close to Gaddafi. We have added the Libyan central bank and the Libyan investment authority to the EU asset freezing list. In so doing, the UK has increased the total of frozen Libyan assets in this country from £2 billion to £12 billion. Clearly, these things have an impact on the regime. We would now like further sanctions to be debated and agreed at the UN in New York, but I obviously do not want to advertise too much in advance what they might be.
Caroline Lucas (Brighton, Pavilion) (Green)
What other non-violent measures is the Secretary of State considering to put more pressure on Libya? I am thinking of things such as a UN-run escrow account for Libyan oil revenues or electronic jamming of all the regime’s communications.
Mr Hague
There is certainly scope to take other non-violent means and the hon. Lady has provided some examples of it. I believe it is important to discuss them with our international partners before announcing them in any detail or giving notice of their coming into effect, but she is quite right to draw attention to the potential for further measures.
Mr Douglas Alexander (Paisley and Renfrewshire South) (Lab)
The Foreign Secretary has rightly said that Libya is in breach of United Nations Security Council resolution 1970. He went on to state this morning that
“not every nation sees eye-to-eye on issues such as a no-fly zone”.
Will the right hon. Gentleman confirm whether specific proposals for a no-fly zone were tabled for discussion at the NATO Defence Ministers meeting last Thursday, at the European Council last Friday or, indeed, at the G8 Foreign Ministers meeting today?
Mr Hague
When it comes to specific proposals, NATO is responsible for contingency planning and it is conducting it for specific plans for a no-fly zone. The other meetings were more at the level of political discussion of what is desirable. There are differences of view among many countries about this issue. What was agreed by G8 Foreign Ministers this morning was that we welcomed the recent declaration by the Arab League calling for a number of measures to protect and support the Libyan population. Clearly, what was called for by the Arab League included reference to a no-fly zone.
Mr Alexander
Yesterday the Prime Minister told the House, in response to a question from the Leader of the Opposition about arming the rebels:
“We should not exclude various possibilities, and there is an argument to be made, but there are important legal, practical and other issues that would have to be resolved, including the UN arms embargo.”—[Official Report, 14 March 2011; Vol. 525, c. 30.]
Can the Foreign Secretary update the House on the Government’s position on each of those issues, given the deteriorating situation of the anti-Gaddafi forces on the ground?
Mr Hague
My right hon. Friend the Prime Minister was quite right. The arms embargo agreed in United Nations resolution 1970 covers the whole country—that is, as it is understood by the members of the Security Council and by the vast majority of legal experts. The rebels and the Gaddafi regime are therefore in the same position as regards the arms embargo. One way of changing that would be to produce a new resolution, which would again require the agreement of the United Nations Security Council.
In the G8 this morning, we agreed to welcome urgent consideration in the United Nations of
“a wide range of measures to ensure the protection of the Libyan population”
and to
“increase the pressure, including through economic measures, for Mr Qadhafi to leave.”
That now requires additional work at the United Nations headquarters in New York.
Caroline Dinenage (Gosport) (Con)
10. What recent discussions he has had with his international counterparts on support for and participation in the enforcement of a no-fly zone over Libya.
The Secretary of State for Foreign and Commonwealth Affairs (Mr William Hague)
We are working closely with partners, including the United Nations, the European Union and NATO, to develop contingency plans to allow the international community to respond quickly and effectively to the developing situation on the ground in Libya. The plans cover a range of options, including the possible establishment of a no-fly zone. As I have said, G8 Foreign Ministers have welcomed the recent declaration by the Arab League calling for measures to support and protect the Libyan population.
Caroline Dinenage
Given that the Arab League and the Gulf Co-operation Council recently endorsed the idea of a no-fly zone, would it not be prudent to allow them to take the lead while the United Kingdom adopts the same policy as the United States of strategic patience?
Mr Hague
Patience must, of course, be tempered by recognition of the fact that the situation is urgent and that events in Libya are moving rapidly on the ground, or at least have done so in recent days. As for my hon. Friend’s important point about participation and the Arab states and the GCC taking the lead, one of the vital elements in any no-fly zone or other operations to protect and support the Libyan civilian population would be the active participation of Arab states.
Mr Bob Ainsworth (Coventry North East) (Lab)
Does the Foreign Secretary agree that there are many reasons for the American President’s caution? He is worried about the west being seen to lead, his forces are stretched, and he is enormously worried about the potential for difficulties in the Gulf and the Arabian peninsula. If we share his analysis, why do we not share his caution?
Mr Hague
The United States has agreed with us on the contingency planning in NATO, and also about the very serious nature of what is happening in Libya and the need for Gaddafi to go. The things for which we have argued are the same things for which the United States has been arguing.
As the right hon. Gentleman says, there are currently many other demands on military and diplomatic resources, but I think he will agree that if Libya were left as a pariah state, particularly after recent events—with Gaddafi running amok, exacting reprisals on his own people and estranged from the rest of the world as a potential source of terrorism in the future—that would pose a danger to the national interest of this country and, I would argue, that of the United States as well.
Richard Ottaway (Croydon South) (Con)
The Foreign Secretary has confirmed what the Prime Minister said yesterday: that a no-fly zone will not be imposed unless there is a clear legal basis for it. Will he confirm that that is a reference to a United Nations chapter VII resolution?
Mr Hague
The clearest legal base for any such operation is obviously a chapter VII resolution of the United Nations Security Council. Lawyers can provide my hon. Friend, and all of us, with extensive arguments about the various circumstances in which nations are allowed to take action, which can of course include self-defence but can also include overwhelming humanitarian need. This is not a completely open-and-shut argument, but the clearest basis is a chapter VII resolution.
Mr Denis MacShane (Rotherham) (Lab)
But can the Foreign Secretary confirm that, actually, UN law is whatever communists in Beijing say it is? There is a whiff of Bosnia of 15, 16, 17 years ago about all this. We do not want the Foreign Secretary to talk about discussions at the UN, empty EU statements and NATO meetings that result in nothing; we want him to discover his mojo and take a lead in putting policies in place before Benghazi falls.
Mr Speaker
We thank the right hon. Gentleman. I call the Foreign Secretary.
Mr Hague
I will make a point of hoping never to discover what motivates the right hon. Gentleman, and never to partake of any of it. [Interruption.] Labour Members are agreeing with me.
I do not accept that UN law is made in Beijing. It is important to have a clear legal base for actions we take internationally, as well as widespread international support and demonstrable need, and since the British Government, along with the French Government, have been absolutely in the forefront of ensuring that all the international sanctions and measures so far have been taken, the right hon. Gentleman is not in much of a position to criticise.
Stephen Gilbert (St Austell and Newquay) (LD)
12. What assessment he has made of the adequacy of consular services provided to UK nationals during the recent events in Libya; and if he will make a statement.
The Parliamentary Under-Secretary of State for Foreign and Commonwealth Affairs (Alistair Burt)
In what has been the most complex FCO-led evacuation since Kuwait, some 600 British nationals were safely brought out of Libya, and we are all grateful for the immense amount of hard work done by those both in this country, and particularly in Libya, to look after our constituents. However, there are always lessons to be learned, and the Foreign Secretary has asked for a review of our evacuation practices in order to make sure that the practice overall is as good as the very best examples of it.
Stephen Gilbert
I am grateful to the Minister for his answer. Given that article 20 of the treaty on the functioning of the European Union allows British nationals to receive consular assistance from any EU member state, what discussions is he having with other EU states to ensure effective and co-ordinated EU responses to such crises in future?
Alistair Burt
There was co-operation and consultation between all European partners right from the beginning. We often shared each other’s planes. The United Kingdom was able to bring out 819 foreign nationals of 43 different countries by way of the work we did. The hon. Gentleman is absolutely right that it is essential in such circumstances that there is a lot of co-operation, and we will continue to make sure our practices provide for that at all times.
Valerie Vaz (Walsall South) (Lab)
The son of a constituent of mine is teaching in Riyadh. What extra consular services and what contingency plans are in place should the situation in Riyadh change?
Alistair Burt
The hon. Lady rightly draws attention to the fact that at present we should be looking at contingency plans right across the middle east and the Gulf, just in case. I can assure her that that work is going on. We all wish to see a stable middle east and north African region, but all the contingency plans are being reworked to make sure they are as effective as possible, and that applies as much to Saudi as it would to Bahrain, Yemen and all other points east.
Mr John Baron (Basildon and Billericay) (Con)
13. What recent steps he has taken to promote political reform in the countries of the middle east; and if he will make a statement.
The Secretary of State for Foreign and Commonwealth Affairs (Mr William Hague)
Britain is ready to support the countries of the middle east in putting in place the building blocks for more open, plural and free societies. As part of our long-term approach, on 8 February in Tunis I announced the launch of the Arab partnership to support the reforms the countries of the region need for a stable and prosperous future. But reform must be home-grown; it cannot be imposed by outsiders, and leadership must come from within the countries concerned.
Mr Baron
I thank the Foreign Secretary for that answer, but I suggest that the provision of independent and accurate information has never been more important than in these uncertain times. Will the Government therefore revisit their decision that is forcing cuts on the BBC World Service, and particularly the BBC Arabic service? It is extremely short-sighted given that service’s excellent reputation in the region.
Mr Hague
My hon. Friend will be pleased to know that the BBC World Service, and in particular the Arabic service, will continue to play a very valuable role in the region: it will continue its 24-hour television channel, and its radio services will continue through FM relays as well as through shortwave services in the region. Those are a continuing and important part of the BBC World Service. Indeed, in the light of recent events, the BBC has already revisited some of its recent decisions that would have affected Arab nations.
Ann Clwyd (Cynon Valley) (Lab)
I took part in a special United Nations conference on the plight of Palestinian prisoners last week, and the descriptions of the conditions in which they are held in Israeli prisons and detention centres were appalling. We were told of torture, inhumane treatment and so on. Some 200 to 300 young people under the age of 18 are held in those conditions. What will the Foreign Secretary do to prevail on the Israelis to adhere to the conventions to which they have signed up?
Mr Hague
Of course we believe that there should be the proper treatment of prisoners throughout the world, including in Israel and anywhere else in the middle east. We have taken up concerns about such issues in the past. If the right hon. Lady would like to give me more details of what she found in that particular case, I will of course look to take them up with the Israeli authorities.
Jeremy Lefroy (Stafford) (Con)
14. What recent assessment he made of the political situation in the middle east; and if he will make a statement.
The Parliamentary Under-Secretary of State for Foreign and Commonwealth Affairs (Alistair Burt)
The question asks about our assessment of the political situation in the middle east and I am tempted to say simply, “It is extremely tricky.” Perhaps I might add that the unprecedented events of recent weeks have created profound political undertones and at the moment it is not possible to say just what the outcomes of these great events will be.
Jeremy Lefroy
I thank the Minister for his reply. The Egypt-Israel peace treaty is a successful model of a land-for-peace agreement, and Egypt has played a crucial role throughout the middle east peace process. What steps are the Government taking to ensure that that agreement continues to be a cornerstone of the process?
Alistair Burt
We were all reassured when one of the first statements made by Egypt’s military council was that it accepted and will adhere to its international agreements. I think everyone understood that it was referring specifically to the peace agreement with Israel, and I hope that that will provide people with confidence. When I was in Egypt last week, I saw the relationship between the military and the politicians, and it is to be hoped that there will be a process towards democratic elections and government, and that that peace treaty will be adhered to by a future Government.
Mike Gapes (Ilford South) (Lab/Co-op)
Will the Minister give us the Government’s security assessment of the situation in Bahrain and the potential for a Shi’a-Sunni conflict both there and in Saudi Arabia?
Alistair Burt
Obviously, we watch events in Bahrain with mounting concern. The sense is that the Bahraini Government should continue to give an opportunity for legitimate protest and that the dialogue should continue with opposition parties. It is incumbent on both the opposition and the Government to keep that process of reform going. On intervention from the GCC at the request of Bahrain, it is essential that that is consistent with the spirit of reform, and not repression.
Barbara Keeley (Worsley and Eccles South) (Lab)
T1. If he will make a statement on his departmental responsibilities.
The Secretary of State for Foreign and Commonwealth Affairs (Mr William Hague)
Last night, I met the Foreign Minister of Japan, Mr Matsumoto, and again conveyed the condolences of the British people after Friday’s earthquake and tsunami. He expressed the thanks and appreciation of his country for the support that we have sent, particularly in the form of search and rescue teams. We also discussed the need to co-operate closely on ascertaining the whereabouts of British nationals in Japan.
Barbara Keeley
I am sure that every Member of this House would wish to be associated with the condolences that the Foreign Secretary just mentioned. The Tibetan Government-in-exile are debating the Dalai Lama’s retirement as their political leader. Will the Foreign Secretary update the House on what support the British Government would give to a newly elected political leader of the Tibetan people in the just cause of gaining greater autonomy for Tibet, given that he has outlined this Government’s support for newly elected leaders in north Africa?
Mr Hague
This Government continue the policy adopted by the previous Government on the status of Tibet. We await further details on what has been announced by the Dalai Lama in respect of an elected leader in the future. We will have to see the details of that before we respond to it in any greater detail.
Robert Halfon (Harlow) (Con)
T4. My right hon. Friend made some welcome remarks about the tragic murder of the Fogel family on the west bank. Is he aware that the Palestinian Government recently gave $2,000 to the family of a terrorist who attacked an Israeli soldier? What steps can he take to stop the incitement of terrorism by the Palestinians?
Mr Hague
I join my hon. Friend in deploring any incitement of terrorism by anyone on any side of the disputes in the middle east. We are not aware as Ministers of the particular instance to which he refers, but if he would like to get in touch with us with the details we will, of course, look into it.
Mr Douglas Alexander (Paisley and Renfrewshire South) (Lab)
May I associate myself and my colleagues with the Foreign Secretary’s expression of sympathy towards the people of Japan at this terrible time? The right hon. Gentleman told the House on 14 February that the British Government had
“received a request from the Egyptian Government to freeze the assets of several former Egyptian officials.”—[Official Report, 14 February 2011; Vol. 523, c. 715.]
Will he tell the House whether he has acted on that request from the Egyptian authorities and gone ahead and frozen the assets of all those former officials?
Mr Hague
We have acted on that request with our European Union partners. One difficulty with pursuing this to the necessary point of freezing the actual assets is the lack of information that has been supplied by the Egyptian authorities. We have urged progress within the European Union so that this is done on an EU basis, and that means that the decisive action remains to be taken. The UK has been at the forefront of the arguments in the EU to take action.
Amber Rudd (Hastings and Rye) (Con)
T5. Political violence by Mugabe’s militias in Zimbabwe is rising again. Does the Secretary of State share my concern that the court ruling last week removing the Movement for Democratic Change Speaker and four of its MPs risks derailing the fragile journey to political reform? Will he raise this as a matter of urgency with President Zuma of South Africa and other leaders in the region?
The Parliamentary Under-Secretary of State for Foreign and Commonwealth Affairs (Mr Henry Bellingham)
I certainly share my hon. Friend’s concerns about the arrest and detention of those MDC MPs. It is a disgrace that they remain in custody. However, our ambassador in Harare attended the hearing this morning for Elton Mangoma, who has now been released on bail. I agree with my hon. Friend that it is essential that President Zuma carries on his good work with the Southern African Development Community to create a robust road map to credible elections.
Steve McCabe (Birmingham, Selly Oak) (Lab)
T2. Do the Government find it acceptable that residents of Camp Ashraf—opponents of the Iranian regime—are subjected to a 24-hour campaign of abuse and torture, including bombardment by 210 loudspeakers? What on earth are we doing about it?
The Parliamentary Under-Secretary of State for Foreign and Commonwealth Affairs (Alistair Burt)
We are aware of both the intrusion of loudspeakers and occasional suggestions that the residents of Camp Ashraf are denied medical assistance. The UK meets representatives of the Iraqi Government’s Camp Ashraf committee, the UN regularly visits the camp and we make every effort to urge the Iraqi authorities to ensure that the residents of Camp Ashraf are treated in accordance with international humanitarian standards.
Mr Peter Bone (Wellingborough) (Con)
T7. The coalition agreement, on page 19, calls for the Government “to limit the application of the Working Time Directive in the United Kingdom.”Tomorrow, this House will be asked to agree a stability mechanism for the eurozone, a decision over which we have a veto. Will the Foreign Secretary withhold agreement on the stability mechanism until we have reform of the working time directive?
The Minister for Europe (Mr David Lidington)
My right hon. Friends the Secretaries of State for Health and for Business, Innovation and Skills are engaged in drawing up Government proposals to address the problem identified by my hon. Friend. The appropriate time to do that is likely to be when the Commission comes forward with new proposals on the working time directive during the next 12 months.
Caroline Lucas (Brighton, Pavilion) (Green)
T3. Libya’s rapid plunge towards civil war is further evidence, if it were needed, of the irresponsibility of selling arms to regimes that seek to quell dissent through force. Will the Government now work to ensure that the UN arms embargo to Libya is extended to all regimes that engage in repression?
Roger Williams (Brecon and Radnorshire) (LD)
T9. Brazil has one of the most rapidly growing of all global economies. Unfortunately, a visit by the Deputy Prime Minister and another Foreign Office Minister had to be postponed. When are there plans to meet the new President of that very important country?
The Minister of State, Foreign and Commonwealth Office (Mr Jeremy Browne)
I have not yet had the opportunity to visit Brazil, although I was due to travel with the Deputy Prime Minister. My hon. Friend makes a very accurate point about the growing significance of Brazil and I am delighted to announce that the Foreign Secretary intends to visit shortly.
Helen Goodman (Bishop Auckland) (Lab)
T6. Yesterday in the House the Prime Minister said that he wanted to establish dialogue with the opposition in Libya. Unfortunately, over the past five days, my constituent Dr Burwaiss, who has contacts in the national liberation council in Benghazi, has had extreme difficulty, despite his and my efforts, in finding out where and to whom information should be sent. Can this now be corrected?
Alistair Burt
I thank the hon. Lady for her question; we have spoken about this over the weekend. The ambassador to Libya, Richard Northern, is working on all available contacts, including the relatives of the gentleman whom the hon. Lady has mentioned. We will make sure not only that contact is made as best as possible but that information is passed back to her constituent.
Martin Horwood (Cheltenham) (LD)
Does the Secretary of State agree that the act of inviting in troops from militarily superior neighbours has evil precedents in the crushing of human rights in 20th-century Europe? If so, as a good historian, will he share that view with the Bahraini and Saudi Governments?
Mr Hague
We are extremely concerned about the escalation of the situation in Bahrain, particularly the decision of the Government of Bahrain to declare a state of emergency. We call on all parties to exercise maximum restraint and to avoid violence. The Government of Bahrain should respect the right to peaceful protest, respond to the legitimate concerns of the Bahraini people and persist with their attempts to draw others into a dialogue on reform. The intervention by GCC partners at the request of the Bahraini Government should also be consistent with that, supporting reform and not repression, allowing a swift return to peaceful conditions and creating an environment in which dialogue can take place.
Rachel Reeves (Leeds West) (Lab)
T8. Last Thursday, I joined students from Swallow Hill community college and Abbey Grange school from my constituency on a visit to Auschwitz. Will the Foreign Secretary join me in commending the Holocaust Educational Trust’s work and will he confirm what funding the Government will commit to supporting the Auschwitz-Birkenau Foundation to ensure that future generations can see what happens when racism and hatred go unchecked?
Mr Lidington
I am grateful to the hon. Lady for raising this point. The Government are determined to preserve the memory of the holocaust to educate future generations and we support the long-term preservation of Auschwitz-Birkenau as a site of remembrance and reflection. We are currently finalising the details of exactly how we will support the foundation and I assure her that an announcement will be made very soon.
Mr Douglas Carswell (Clacton) (Con)
Does my right hon. Friend believe that the appetite for democracy is universal? If so, what moral support and encouragement will he offer those in Iran who seek to live freely as we do?
Mr Hague
I agree with my hon. Friend. We believe that human rights, including democratic rights, are universal. It is particularly pertinent to raise the situation in Iran because the two principal leaders of the opposition forces in Iran, Mr Mousavi and Mr Karroubi, have been detained with their wives—they have disappeared with their wives. I am glad that my hon. Friend raised this matter because it is important, amidst the current turbulence in the middle east, not to forget what is happening in Iran and to remember that a country that has preached support for protest in other nations does not hesitate brutally to suppress protest within its own borders.
Ian Austin (Dudley North) (Lab)
T10. Hamas terrorists fired long-range rockets into apartments in Beersheba just a few weeks ago. With Hamas’s leader calling for jihad, not negotiation, and with Iran supplying weapons to Hamas, Hezbollah and the Taliban, what more can the Secretary of State do to curtail terrorist attacks against our forces in Afghanistan and our allies in the middle east?
Mr Hague
I listed earlier some of the things we are doing. Clearly, we are intercepting some of the shipments of arms that have been involved. That is how we know about the rockets that were being shipped to the Taliban and about the ammunition involved. I set out some of the other actions, including diplomatic actions, that we are taking. We have stepped up our efforts in that regard, but the hon. Gentleman is quite right to ask us to do still more.
Andrew Rosindell (Romford) (Con)
When the Foreign Secretary next meets Secretary of State Clinton, will he clarify with her the American Government’s position on the Falkland Islands? Do they support British sovereignty or not?
Angus Robertson (Moray) (SNP)
The European Union’s 27 Energy Ministers are meeting today to discuss nuclear safety in the wake of the horrific developments in Japan. As a minimum, will the UK Government support Germany, France and Spain in their support of a proposal by the Austrian Energy Minister, Niki Berlakovich, that there should be stress tests in all nuclear power stations across the European Union, including those in the UK?
Mr Lidington
There is a range of possible options that European Energy Ministers will discuss today. The important principle is that politicians should be guided by scientific evidence about the best steps available to ensure that nuclear safety is maintained.
Duncan Hames (Chippenham) (LD)
Air strikes against his own people, the use of mercenaries, the imprisonment of foreign journalists—what does the Foreign Secretary believe would be the impact on human rights elsewhere in the world were Gaddafi’s tactics seen to be successful?
Mr Hague
My hon. Friend makes a powerful point, and a parallel point to the one that the Prime Minister made here yesterday. If Gaddafi succeeded in suppressing the desire for a freer and more open country in Libya, there are tyrants elsewhere who would draw the wrong lesson from it. That is why we are at the forefront of all the activity that I described during our Question Time today, but I stress alongside that that whatever we do must be legal and have international support.
Mark Lazarowicz (Edinburgh North and Leith) (Lab/Co-op)
Will the Foreign Secretary raise at the next European Council meeting the case of my constituent, David Petrie, who is one of a group of English language lecturers in Italy who have been fighting for a European right to equal pay for 25 years? After six victories in the European Court, they thought they were going to get justice, only to find that the Berlusconi Government have changed the law.
Mr Lidington
We regard the treatment of the lettori as completely unacceptable, and through both our embassy in Rome and ministerial contacts we are pursuing the matter energetically with the Italian authorities.
Dr Julian Lewis (New Forest East) (Con)
If Britain decides to take part in an unanticipated military commitment to engage in a no-fly zone in Libya, will the extra cost be added to or will it be taken from the existing defence budget?
John Cryer (Leyton and Wanstead) (Lab)
Further to the question from my right hon. Friend the Member for Paisley and Renfrewshire South (Mr Alexander), my understanding is that a list was provided by the Egyptian authorities of people connected to the Mubarak regime. Is the information on that list inadequate, or are other members of the EU dragging their feet?
Margot James (Stourbridge) (Con)
During last night’s Adjournment debate on the future of the BBC Hindi service, the House was pleased to hear that discussions are taking place between the Foreign Office and the Department for International Development that could lead to World Service expenditure being considered as official development assistance. Does my right hon. Friend agree that everything possible should be done to protect this very important part of British soft diplomacy?
Mr Hague
It is possible for some of the expenditure of the BBC World Service to be classified in the way that my hon. Friend describes. In the Foreign Office we have done everything we can to give financial support, including transitional support, to the BBC World Service. She will be aware of the fact that in three years it will be funded by the BBC licence fee, and that transfer of funding will give new opportunities for the future. But every part of the public sector must contribute to improving its efficiency and saving money; there is no getting away from that.
Mr Russell Brown (Dumfries and Galloway) (Lab)
None of us can imagine the plight that tens of thousands of people are experiencing in Japan at this time, and they include UK citizens. My constituent’s son, his wife and their seven-month-old child are stuck in the north of Sendai city. They are in a hotel where a bus turned up this morning and took away a number of European nationals who were fit and healthy, including Irish nationals. However, the only advice being given by our Foreign Office is, regrettably, just that—advice. It is not assisting with transport. Can something more be done?
Mr Jeremy Browne
The British Government have put in a hugely comprehensive response to help British nationals in Japan. We have supplemented what is already a large embassy with an additional 45 staff from across Asia and elsewhere in the world. We are trying to do everything possible to help British nationals in what is a chaotic and difficult situation, but if the hon. Gentleman gives me the details of the case that he has just raised, I will ensure that I give it my personal attention.
Mr Speaker
Order. I am sorry that some colleagues are disappointed: the demand today is huge and the supply limited.
Petition
Sir Peter Soulsby (Leicester South) (Lab)
A few weeks ago, my right hon. Friend the Member for Leicester East (Keith Vaz), supported by my hon. Friend the Member for Leicester West (Liz Kendall) and me, launched a city-wide petition against the Government’s proposals to abolish the education maintenance allowance. Last week my right hon. Friend presented a petition presented by those who study at Gateway college in his constituency. Tonight I present a petition signed by those associated with Regent college and Wyggeston and Queen Elizabeth I college in my constituency.
Signed by 327 people, the petition states:
The Petition of residents of Leicester and the surrounding area,
Declares that the Petitioners oppose the abolition of the Education Maintenance Allowance; notes that a substantial number of young people are in receipt of the Education Maintenance Allowance in Leicester; and further notes that education can provide a better future for young people.
The Petitioners therefore request that the House of Commons urges the Government not to abolish the Education Maintenance Allowance.
And the Petitioners remain, etc.
[P000901]
Points of Order
Mr Iain Wright (Hartlepool) (Lab)
On a point of order, Mr Speaker. In business questions last week, my hon. Friend the Member for Gateshead (Ian Mearns)—whom I am pleased to see in his place today—asked about the 563 parliamentary questions to the Department for Education that are currently unanswered. In written responses to me, the Department has stated that only 10% of named day questions and 20% of letters from hon. Members have been answered on time, with some going as far back as November. On top of Building Schools for the Future and school sport partnerships, that shows a Department in a shambolic and chaotic state, whether through incompetence or laziness. It is not good enough. A schoolchild who had done only 10% of their homework would get detention. What can you do, Mr Speaker, to keep Ministers back after school for failing to do their homework, which—on a serious note—is preventing hon. Members from holding the Government to account for their education policy and acting on behalf of their constituents?
Mr Speaker
I am grateful to the hon. Gentleman for his point of order and for notice of it. I sympathise with the concern that he has expressed. I understand that other hon. Members have been affected in the same way. I deprecate late replies, but Ministers are responsible for their answers. Oral questions to the Department for Education will be taken next Monday. I suggest that the hon. Gentleman and others with similar experiences and views seek advice from the Table Office on how to pursue this matter. The Deputy Leader of the House is in his place and will have heard the concern expressed. This is a serious matter, and I hope that something will indeed be done to address the concern that the hon. Gentleman and others regularly raise.
Mr John Spellar (Warley) (Lab)
On a point of order, Mr Speaker. Have you had any notification that either the Secretary of State for Communities and Local Government or the Secretary of State for Health wants to make a statement about the crisis in Southern Cross Healthcare, whose share price has collapsed to one hundredth of its peak? Southern Cross Healthcare has 750 care homes across the country, with 31,000 elderly and vulnerable residents. They and their relatives need urgent reassurance and action from Ministers.
Mr Speaker
The short answer to the right hon. Gentleman is that I have received no indication that any Minister wants to make a statement on the subject. He has put his concerns about the matter on the record explicitly. I will not call him an old hand, because he will take offence, but he is a wily operator, and I have a feeling that he will use the opportunities open to him in the House to pursue this matter for as long as he judges necessary.
Financial Services (Regulation of Derivatives)
(13 years, 1 month ago)
Commons ChamberRead Full debate Read Hansard Text Read Debate Ministerial Extracts
Steve Baker (Wycombe) (Con)
I beg to move,
That leave be given to bring in a Bill to require certain financial institutions to prepare parallel accounts on the basis of the lower of historic cost and mark to market for their exposure to derivatives; and for connected purposes.
I rise not as an expert in derivatives or derivative accounting, but as someone who has wrestled with the problems of the banking system in the company of experts, both academic and practical. I am persuaded that a parallel, more conservative accounting regime for derivatives would mitigate some of the worst risks in the financial system.
Even though banks are governed by overarching EU and Basel rules, it is for British regulators to approve the day-to-day activities of British banks. This is a profoundly important role. My Bill is a moderate proposal that seeks to improve accounting transparency to enable that role, because, as Mervyn King has said,
“banks are global in life but national in death”.
The Bill could be enacted within the current international regulatory framework.
To explain why this measure is profoundly important, I would like to share with Members an analogy of the banking system. Naturally, it will short-circuit some of the details, but even though it remains necessarily complex. Let us imagine that we discover a little-known territory within the EU on which to establish a colony. Let us call it Ruritania and allow its currency to be pounds. We will establish our fledgling colony with four people: a depositor, Alice, who arrives with £103; a builder, Bob—naturally—an entrepreneur, Matilda; and a banker, Mallory, with a colourful recent past in Iceland and Ireland. Interest rates are 0.5%. Mallory establishes a bank and persuades the other three inhabitants of the importance of a healthy banking system, so Ruritania’s constitution contains a limited guarantee from future taxpayers of £10 in favour of the bank. Under central European banking authority devolved rules, Ruritania classifies that guarantee as core tier 1 bank capital, meaning that there is no actual capital, just a taxpayer guarantee.
Alice, seeking to keep her money safe, deposits it in a demand account at the bank. Matilda, the entrepreneur, wants to start a business and approaches Mallory for a loan. The bank retains a supposedly prudent reserve of £3 from Alice’s deposit and lends to Matilda, at 7% interest, the remaining £100 of cash deposited by Alice. Matilda then employs Bob, who wants his year’s wages up front. She hands over the £100 to Bob, which he deposits in the bank. Let us set aside for the moment the fact that the bank just doubled the money supply of Ruritania, as that issue is dealt with in the Financial Services (Regulation of Deposits and Lending) Bill, introduced by my hon. Friend the Member for Clacton (Mr Carswell), which I was glad to support. The banker now has two liabilities: a deposit of £103 from Alice and a deposit of £100 from Bob. Offsetting those, he has two assets: a 25-year loan of £100 and cash of £103. So far, so simple.
Mallory wants a Ferrari today, which he can buy for £20. His compensation contract is 20% of profits, which is not unusual in banking. He therefore seeks to record an instant £100 profit for his bank, and he knows just how to do that under EU bank accounting rules. He phones an insurer active in the credit derivatives market—let us call it GIA—which agrees to write a derivative known as a credit default swap for a fee of 1% per annum. It is a guarantee of 95% of the loan.
The bank quickly establishes a new company, a special purpose vehicle, which buys the future loan cash flows of £275. The credit derivative is written directly with that new company, the SPV. The SPV finances its purchases by issuing two bonds: a 95% senior bond, rated triple A by two august rating agencies because GIA is so rated; and a 5% junior or equity tranche. The bank buys the two bonds with the £100 cash. The funds then flow back from the SPV to the bank to settle that purchase. That kind of circular flow of cash is commonly used. The result is that the equity tranche of £5 is a deduction from the bank’s £10 tier 1 capital. Members will recall that that capital is a future taxpayers’ pledge, not hard cash.
Under mark-to-market rules, Mallory, by holding the bond on his trading book, records an instant but unrealised profit of £105. After replenishing his tier 1 capital with £5, he shows that £100 clear profit. That profit has been recorded, even though the bank has not received any income from the loan, and that loan might never be repaid. Mallory the banker is not concerned about that, however; he has his Ferrari. Any shareholders are not concerned either, as the bank also declares an £80 dividend.
The banker and his shareholders have taken £100 of the £103 total money supply of Ruritania, declared it as profit and spent it abroad. Mallory likes mark-to-market accounting and seeks to grow his bank by making further investments. He cannot sell the bond on the open market, so he borrows against it through an arrangement with a central bank, known as a repo. He receives £205 in cash from the central bank, and the central bank has a mortgage on his bond.
Mallory uses the balance as collateral for further bets, such as derivatives with other banks and low-priced Irish bank-issued bonds, in the hope of more fast profits. Unfortunately, his bank becomes insolvent when Matilda misses a loan payment, and it cannot refinance the central bank’s funding, so the central bank takes ownership of the bond—Mallory’s bank’s one decent asset. Depositors ask for their funds, but the bank cannot pay. That could be the crisis of 2014.
On our Ruritanian bank’s liquidation, we find that two depositors have claims for £203, but there is only £6 in cash; all the rest had been pledged as collateral and the bank’s assets cannot be sold. There happens to have been another freakishly unlikely collapse. Stakeholders had not realised that the bank’s one decent asset had been repo’d with the central bank, because it remained on Mallory’s bank’s balance sheet right up to foreclosure. Mallory, of course, lives happily ever after.
Financial derivatives and certain other “synthetic” investments are governed by mark to market. Banks record a profit or loss in respect of each derivative by comparing the price of the asset or liability in today’s market with the value of the position on the last balance sheet date. What is wrong with that? Marking to market enables banks to record unrealised increases in value as profits, but that is not the case with loans. The arbitrage between the different accounting regimes for loans and for derivatives therefore incentivises banks to transact business in derivatives. The fundamental driving force behind the phenomenal growth of the credit derivatives market has been profit acceleration using that accounting arbitrage.
Regulators need to be aware of those exposures in order to help avert any future threats. That requires the publication of accounts with derivatives and other investments recorded at the lower of historic cost and their mark-to-market value. If my Bill becomes law, the ability to declare future hoped-for income as profit today and the rest of the absurd activity that I have described would be restrained.
If we want banks to refocus on stimulating the real economy, we need to change those incentives. I therefore ask the House to support this Bill and, in so doing, to correct one of the most damaging and misunderstood weaknesses of the current British banking system.
Question put and agreed to.
Ordered,
That Steve Baker, Mr Douglas Carswell, Andrea Leadsom and Chris Heaton-Harris present the Bill.
Steve Baker accordingly presented the Bill.
Bill read the First time; to be read a Second time on Friday 10 June and to be printed (Bill 162).
The Parliamentary Secretary, Office of the Leader of the House of Commons (Mr David Heath)
On a point of order, Mr Speaker. The House will have heard earlier the point of order from the hon. Member for Hartlepool (Mr Wright) about the delay in responses to hon. Members’ questions from the Department for Education. The whole House should be concerned when there has been a delay, and you, Sir, have made clear your views on the issue.
I have now investigated the matter, and it seems as though there is a specific problem within the Department for Education in that there has been a technical failure in the IT system that it uses to track parliamentary questions. The problem has now been identified and fixed, and officials are working towards providing outstanding responses as quickly as possible. The hon. Member for Gateshead (Ian Mearns) will today have received a letter explaining the delay in those terms. I hope, Mr Speaker, that normal service will be resumed as soon as possible, and I know that the Department would wish to apologise to any Member of the House who has been inconvenienced by the delay caused by these circumstances.
Mr Speaker
I thank the Deputy Leader of the House for what he has said. The situation is clearly both regrettable and unsatisfactory, and it is much to be hoped that it can be avoided in future. However, the speed with which he has investigated the matter will, I think, be appreciated by all right hon. and hon. Members.
Scotland Bill
(13 years, 1 month ago)
Commons ChamberRead Full debate Read Hansard Text Read Debate Ministerial Extracts
18:43 - The Committee divided: - Ayes: 9 / Noes: 480 - Question accordingly negatived.
19:31 - The Committee divided: - Ayes: 172 / Noes: 293 - Question accordingly negatived.
20:31 - The Committee divided: - Ayes: 8 / Noes: 448 - Question accordingly negatived.
21:27 - The Committee divided: - Ayes: 6 / Noes: 439 - Question accordingly negatived.
22:00 - The Committee divided: - Ayes: 136 / Noes: 311 - Question accordingly negatived.
The Chairman of Ways and Means (Mr Lindsay Hoyle)
I remind the Committee that with this we are discussing new clause 2—Regional members of the Scottish Parliament—
‘(1) The Scotland Act 1998 is amended as follows.
(2) In section 81, after subsection (2), there is inserted—
“(2A) No provision shall be made under subsection (2) for any allowances for representative work in any constituency or region by a regional member in a registered political party or a group of such regional members; and no allowances may be made for offices or staff or related expenses incurred by such members other than in connection with or at the Parliament’s place of meeting or in connection with a committee meeting.
(2B) Any allowances paid to regional members in a registered political party shall be founded on the assumption that they are representatives of that party from the relevant region and not from any single constituency.”.
(3) In Schedule 3, after paragraph 2 , there is inserted—
2A The standing orders shall include provision for withdrawing from a regional member in a registered political party any or all of his rights and privileges as a member, including any allowances, if he is found to have purported to act, or has held himself out, as a constituency member for any single constituency or for a group of constituencies other than the region from which he was elected.”’.
Mr Brian H. Donohoe (Central Ayrshire) (Lab)
Let me continue where we left off yesterday in discussing new clauses 1 and 2, particularly the question of first past the post being the fairer system—
Mr Angus Brendan MacNeil (Na h-Eileanan an Iar) (SNP)
Will the hon. Gentleman give way?
Mr Donohoe
I will give way when I have developed my argument one stage further than when I left off. An important aspect of this is that first past the post is the system that is best understood by the electorate—indeed, I would argue, it is almost the only system that is understood by the electorate.
Mr MacNeil
I think that if the hon. Gentleman looks at yesterday’s Hansard, he will find that we finished where I left off. At 10 pm last night, I was about to ask him what he had against the good people of the Western Isles in wanting to give them only one Member, with every other constituency getting two.
Mr Donohoe
I have always thought that the Member who looks after sheep should be able to count. If he could count, he would know that there are not that many people in the electorate of the Western Isles. In those circumstances, I thought it only fair that there should be just the one Member. As I said previously, there would be one Member for Orkney and one Member for Shetland. That would mean that there would be 118 Members of the Scottish Parliament, all elected on the basis of first past the post. If the hon. Gentleman tells me that I have got the figures wrong, perhaps I need to go back to school to do a bit of arithmetic, but I can tell him that I was one of the brightest children in the school at arithmetic; indeed, I got 100% on many occasions.
However, perhaps one area where I was not very strong was dates, because earlier in the debate I said to the hon. Gentleman that the Scottish elections were on 3 May whereas—he should have corrected me—they are on 5 May.
Mr Ian Davidson (Glasgow South West) (Lab/Co-op)
Is it the case that the school my hon. Friend attended was so good that it was approved?
Mr Donohoe
It was so good that it was known as Irvine Royal Academy. Anyway, we will move on very quickly from that point.
Mr Reid
According to Hansard, just before the hon. Gentleman sat down last night, he said that there would be 119 Members of the Scottish Parliament. He just said that there would be 118. My understanding is that all 59 constituencies, apart from the Western Isles, would have two Members, and that the Western Isles would get one. I think that that makes 117.
Mr Donohoe
I think that we are wandering into maths rather than arithmetic, but the hon. Gentleman is absolutely right. Of course, that would be a saving to the public purse, which is very important. Perhaps one could call it a Freudian slip. I have come to the conclusion that he is right and that the number should indeed be 117, and not 119 as I suggested.
Moving swiftly on—
Mark Lazarowicz
Surely with the passage of the Parliamentary Voting System and Constituencies Bill, which will reduce the number of parliamentary constituencies, the correct figure would in fact be 103.
Mr Donohoe
If the hon. Gentleman intervenes again to give me some understanding of that point, I might be able to accede to it.
David Mundell
Perhaps I might help the hon. Gentleman. My calculation is that there would be 101 Members. After the passage of the Parliamentary Voting System and Constituencies Bill, there will be 52 constituencies in Scotland. If each had two Members, there would be 104. However, there are three constituencies that he feels should have only one Member, although my reading of new clause 1 is that people would still have two votes. There would therefore be 101 Members in the new Scottish Parliament. Does he think that that would be sufficient to conduct the Parliament’s business?
Mr Donohoe
The Minister has made my point very well in relation to making savings, which is the next point that I want to make progress on, if I may.
Mr Weir
Will the hon. Gentleman clarify whether he is talking about Westminster Parliament constituencies or Scottish Parliament constituencies, because the numbers are different? There are 59 Scottish Parliament constituencies, but once the Parliamentary Voting System and Constituencies Bill has been passed there will be only 52 Scottish constituencies for the Westminster Parliament.
Mr Donohoe
That is common sense, if I may say so. When I made the calculation to put together my submission to Calman, we did not have this nonsense of reducing the number of MPs in this place. That idea is patently stupid in Scotland. The hon. Member for Caithness, Sutherland and Easter Ross (John Thurso), who is present, will know that the area he represents will become even more enormous under these calculations than it is. Perhaps the Independent Parliamentary Standards Authority should visit him to check out what his expenses should be in those circumstances. However, I digress somewhat.
I shall return to the issue of savings and first past the post. It is clear from this debate that there is a case to be made for this idea. It is clear from the number of public representatives on the London assembly that there can be adequate government for a population double the size of Scotland’s with some 30 members. Given the responsibilities in London, one would presume that it was possible to run the Scottish Government with the numbers that I propose.
Mr MacNeil
The hon. Gentleman wants to reduce the number of parliamentary representatives from Scotland. Will he lead by example and suggest that Scotland no longer needs to send any MPs to Westminster, because Scotland should be independent and all powers pertaining to Scotland should be moved from Westminster back to Scotland?
Mr Donohoe
The first people who could go in these circumstances are, of course, the nats. That would be very useful. I am surprised that only four of their six Members are here today. However, looking at the Labour Benches, perhaps I should not argue that point too forcefully.
To return to my serious argument, first past the post is the most sensible system on the basis of turnout. If we look at the turnout at elections—today I had the good fortune of having the Library do so—we see that there is no doubt that we, as a group, need to reconnect with the public. It is highly probable that we will go below 50% turnout at this year’s Scottish elections. In the 2007 election, the turnout was just above 52%. In the election to the Westminster Parliament last year, the figure was just under 64%. On that basis, we should consider the matter seriously.
Mr Greg Knight (East Yorkshire) (Con)
Is the hon. Gentleman therefore arguing in favour of a system rather like the Australians have, in which people are fined if they do not exercise their right to vote?
Mr Donohoe
I am grateful for the intervention, but I disagree with the idea of compulsory voting and fines. I have been to Australia to examine the system, and it just does not work as it should, so I would not advocate it. In Africa, however, people queue for weeks before an election to cast their vote, and we should have some of that attitude in this country. I do not think we will ever get it unless we reconnect with the public, and certainly not if we continue to have list Members north of the border.
That brings me neatly to new clause 2. If there is to be no change to the voting system, we have to consider the role of the list Members in the Scottish Parliament. We must seriously consider withdrawing the funding that is currently available to them, which allows them to come into constituencies to cherry-pick and cause mayhem.
Cathy Jamieson (Kilmarnock and Loudoun) (Lab/Co-op)
Does my hon. Friend share my concern, which has been a consistent concern in Scotland, that at various times list Members appear to have promoted themselves as constituency Members? Does he agree that that must be tackled as a matter of priority? Does he further understand that in the spirit of the Scottish Parliament rules, it was anticipated that regional list Members would notify constituency Members whenever they took up casework? In my almost 12 years as an MSP, it was very rare—
The Chairman
Order. I know that this debate is very important, but may we have shorter interventions?
Mr Donohoe
There is no one in the House who knows the system north of the border better than my hon. Friend, because she was an MSP, and still is until, I think, the 24th of this month.
Graeme Morrice (Livingston) (Lab)
Following on from the point made by my hon. Friend the Member for Kilmarnock and Loudoun (Cathy Jamieson), is my hon. Friend the Member for Central Ayrshire (Mr Donohoe) aware of the recent case in which a regional list MSP for Central Scotland was claiming to be almost a constituency MSP for Airdrie and Shotts, to the extent that he had surgery posters with “Airdrie and Shotts” on them? The regional area that he covers is, of course, much larger. I suspect that it was done for electoral reasons, with his being the SNP candidate for the Airdrie and Shotts Scottish parliamentary constituency.
Mr Donohoe
Of course I agree with my hon. Friend, and I shall return to that point.
Fiona O'Donnell (East Lothian) (Lab)
I can tell my hon. Friend that I barely slept last night waiting to make this intervention. Will he at least acknowledge that the current system came about as a result of a consultative process—the Scottish Constitutional Convention—which the Committee should respect?
Mr Donohoe
My hon. Friend may not have slept last night, but what does she think of the fact that I have had to come back here to continue this debate? I will come back to her point later.
Mark Lazarowicz
I disagree with much of what my hon. Friend said yesterday and today, but I concede his point on the role of list MSPs. One list MSP in my area just produced her annual report. By some amazing coincidence, almost every single example of her local work over the last year happens to be from the constituency where she is standing as a constituency candidate.
Mr Donohoe
On the basis of conversations with other hon. Members, there is universal agreement that something is fundamentally wrong with that aspect of list Members. Even a previous Presiding Officer has made that point on numerous occasions in the Scottish Parliament. That is a pertinent issue and it must be given serious consideration, which is why I have proposed new clause 2, which would withdraw funding. Withdrawing the funding available to added list Members would lead to significant savings for the Scottish Parliament. If my arithmetic is correct, there are 56 added list MSPs, given that 73 MSPs are elected for constituencies—I believe my figures are right on this occasion.
Mr Mark Field (Cities of London and Westminster) (Con)
Does the hon. Gentleman share my concern that, fundamentally, list Members are representatives only of their parties? In new clauses 1 and 2, he is seeking to reconnect MSPs with constituents. Under the first-past-the-post system, MSPs must recognise that they represent each and every one of their constituents, including—and in many ways more importantly—those who did not vote for them, which is in stark contrast to list Members.
Mr Donohoe
I agree entirely with the hon. Gentleman, who is my MP, as he knows. I came into Parliament thinking that I was a Labour MP, but over the years I have come to understand that I represent not just Labour voters but 100% of my constituents, including those who vote and those who do not vote. I have always taken that view. The hon. Gentleman makes a good intervention, and I am grateful for it, but I do not know what it has to do with the subject in hand.
If one accepts that list Members are not to make representations on behalf of individual constituents, the question is why do they advertise constituency surgeries? On one occasion, such a Member, who will remain nameless, advertised a surgery in my constituency. I was not very pleased, so I decided to look through all the files in my office—some 2,500 files—for some awkward cases. I decided I would phone those awkward cases and tell them that this individual was having a surgery in Irvine, and that they should attend because he made such a good MSP. Seventeen people trooped to his surgery, and he never did a surgery in Irvine again. That is the practical way to overcome the problem of added list Members in the Scottish Parliament. If anyone wants a wee bit of encouragement to do likewise, I am more than happy to oblige.
Mr MacNeil
I was wondering whether the awkward cases had already been sent to the hon. Gentleman.
Mr Donohoe
No, I already had the awkward cases and knew all about them. Every single Member in this place—even those who came in last year—will be well aware of the cases that they would like to palm off. It might be that we could find a role for those list Members and send them all over the UK to take up these awkward cases. I might be one of those who would advocate that—but not today, because we are here to debate new clauses 1 and 2.
My final point concerns what happens when a list Member dies in office. Of course, that is unfair on the individual, although they would no longer worry about it; but there is also an unfairness in the system, as we have seen—believe it or not—in Ayrshire: a Member of the Scottish Parliament resigned and a member of the constituency party was put in their place, but that Labour member was not elected and a Tory took their place. Had it been a list Member who resigned, however, under the list system the next person on the list would have been appointed as a Member of the Scottish Parliament.
Cathy Jamieson
To clarify, does my hon. Friend agree that it makes no sense that everything else in the Scottish Parliament is done by proportionality and d’Hondt? This is the one area where that does not seem to apply.
Mr Donohoe
That is a discussion for another day, but it is a very pertinent point—and one that a lot of people do not understand. A lot of people do not understand this crazy list system. As I have said, if a constituency Member resigns, a by-election is triggered, and whatever happens the democratic process takes place. However, if a list Member dies, retires or resigns, they are replaced by somebody on the list, which is absolutely outrageous. The Labour party is concerned to have a gender balance, but this system destroys that possibility.
Thomas Docherty (Dunfermline and West Fife) (Lab)
My hon. Friend is making a compelling and fascinating case. He might be aware that when the Minister moved to Westminster, his replacement was simply appointed by the Tory apparatchiks without any democratic mandate.
Mr Donohoe
I am sure that the Minister can speak for himself and tell us why he thinks that this aspect of the list system is fair. I shall wait to see whether he has a contribution to make on that point.
Mr Mark Field
The same point applies to the London assembly, and it is slightly more serious even than he has pointed out. Certain roles, such as being a member of the London assembly, disbar a person from holding a dual mandate in Parliament. As the hon. Gentleman rightly says, however, for list members of the London assembly, that change can take place without any difficulty, but for a first-past-the-post elected member—one of the 14 of the 25 in that category—there needs to be a separate election. I agree that it is a fundamental stupidity of the system that needs urgent reform, but it is not exclusively an issue for the Scottish Parliament.
Mr Donohoe
I am extremely grateful to my Member of Parliament for raising that point. Of course it is a serious point and it has to be addressed, because it causes dissent and demonstrates that the list system in Scotland does not—and will not—work, and is not seen as fair.
Fiona O'Donnell
I thank my hon. Friend for being so generous in giving way. I know that he would never be partisan, but surely he can see the benefit for the thousands of people in the highlands and islands region who vote for Labour candidates, and who, thanks to the system, have three excellent candidates in Peter Peacock, Rhoda Grant and David Stewart.
Mr Donohoe
Well, I got one out of three, so I did not do too badly. I bet that if I asked the hon. Member for Na h-Eileanan an Iar (Mr MacNeil) to name his seven list Members—or even the 24 in my constituency—he would be lucky to name three of them. But I will give way, if he is going to reel them off. [Interruption.] He has it on his website! That is a bit of a cheat, would you not say, Mr Hoyle? Anyway, I am coming to the end of my contribution, you will be glad to know.
Stewart Hosie (Dundee East) (SNP)
I am sorry that I was not in my place for the start of the hon. Gentleman’s contribution, but I have been following most of it. I am unhappy about Members of the Scottish Parliament being named when they are not here to defend themselves. As for the three people mentioned by the hon. Member for East Lothian (Fiona O'Donnell), will the hon. Gentleman tell us whether one, two or all three of them as list members also intend to stand in the first-past-the-post election? If so, that would pose a very interesting question.
Mr Donohoe
The hon. Gentleman raises a pertinent point—one that my individual constituency voted on and came to a unanimous decision. I stress that this is on the basis of a vote only in my own constituency, but not a single person in the constituency party was in support of any added list members also standing for a particular constituency. I mentioned that earlier when I spoke about a person who came fourth in the first-past-the post election in my constituency finding herself in Parliament. That does not make sense, and I doubt whether the hon. Gentleman would say that it made sense.
Let me conclude. This is an important subject for the chattering classes, but it is not very important to the great bulk of people in Scotland—or, for that matter, anywhere in the United Kingdom. One thing is certain: electoral systems do not put food in bairns’ stomachs or jobs into the homes of people who most need them in order to put that food in bairns’ stomachs. I suggest that it is therefore more important for us to argue against and probe Ministers daily on the state of the economy. However, we are where we are; and we are debating what we are. That is why I thought it right to table these two new clauses for debate.
I want fairness: it is something I came into politics for. I have always believed in fairness and I believe there is no doubt, as conceded in this debate, that there is no accountability for these list members. My two new clauses thus have considerable merit, but I shall listen carefully to how the debate continues.
Mr Reid
It will come as no surprise to the hon. Member for Central Ayrshire (Mr Donohoe) that I will not support his new clause. He ended by talking about fairness, but that goes to the hub of the debate. What is unfair about his system is that it would gerrymander the voting system in favour of one party—his own, the Labour party. It is an extremely unfair system. That is what the debate should be about, but the hon. Gentleman did not touch on that anywhere in his contribution.
Thomas Docherty
I am fascinated by the hon. Gentleman’s new-found passion for stopping gerrymandering. Will he remind us why he voted last week to give the Isle of Wight two seats?
Mr Reid
It was a product of the coalition agreement. I was in favour of the first part of the Bill; I did not like the second part, but we made a coalition agreement. The Liberal Democrats liked part 1; Conservative colleagues liked part 2, but not part 1: that is what compromise and coalition is all about.
The hon. Member for Central Ayrshire also said that people did not consider the voting system to be important. People may not be aware of the intricacies of the voting system, but the people of Scotland overwhelmingly voted in the referendum for a proportional voting system, so that is important to them. It was endorsed by the Constitutional Convention, of which the hon. Gentleman was a member, and then, as I say, by the people of Scotland in a referendum.
Sheila Gilmore (Edinburgh East) (Lab)
Does the hon. Gentleman agree that there is a particular problem with the party list system? Many advocates of proportional representation argue that it will make people more accountable. The experience of the system in Scotland, however, has been that some people can bounce backwards and forwards from being constituency MSPs to being top of their party list—and back again, or not—so the public has little chance of dislodging them unless the party does. Might there not be a better list system than the party list system?
Mr Reid
That is a fair point. I am fully in favour of proportional representation, but every electoral system can be improved. One way of improving this system would be to move from closed to open lists, which would give the electorate a choice. Another reform is also possible: if cherry-picking of constituencies by regional list Members is considered to be a problem, we can adopt the system in Wales whereby no one can stand both for a constituency and on the regional list. That would remove the problem of cherry-picking at a stroke, because there would be no advantage for a regional list Member in cherry-picking a particular constituency.
Fiona O’Donnell
Does the hon. Gentleman agree that we have already seen improvements, such as the removal from the list of the vanity party that was “Alex Salmond for First Minister”?
Mr Reid
If the SNP wants to call itself Alex Salmond for First Minister, it is perfectly entitled to do so. What it cannot do is confuse the electorate by having two names. One minute it is called the Scottish National party; the next minute it is called Alex Salmond for First Minister. If only SNP members would make up their minds on what they want their party to be called.
Mr Reid
I think that the law was changed.
I understand that the hon. Member for Central Ayrshire chairs the all-party parliamentary group for the promotion of first past the post. He has continually extolled the virtues of the first-past-the-post system, but that is not my understanding of what his new clause actually means. I think that it would be more accurately described as promoting “first two past the post”.
Mr MacNeil
Does the hon. Gentleman agree that at least the alternative vote gives true believers in first past the post an opportunity to practise it? They can use their votes only once if they want. They can write “1”, or “X”, and not use any subsequent numbers. It is possible to use first past the post under an AV system, but the reverse is not the case.
Mr Donohoe
I am going to have to accuse the hon. Member for Argyll and Bute (Mr Reid) of cherry-picking. He has read only part of my new clause. His problem can be solved by paragraph (b) of the new section (4A) proposed in subsection (6), which requires provision for
“the two candidates with the most valid votes to be elected in such constituencies.”
The Chairman of Ways and Means (Mr Lindsay Hoyle)
I think that the hon. Member for Central Ayrshire (Mr Donohoe) was signalling “first two past the post” and nothing more. I am reassured, am I not, Mr Donohoe? Yes.
Mr Reid
Thank you for that clarification, Mr Hoyle.
In these constituencies two Members will be elected—the two who receive the most votes. That is not first past the post; it is first two past the post. I do not think that the hon. Member for Central Ayrshire understands his own new clause.
Graeme Morrice
My understanding of the system is that there are two candidates, and therefore two votes. Of course that is based on first past the post. It is not dissimilar to the system that applies to local government elections in England when there are several candidates for several seats within a multi-member ward and electors have several Xs to put on a ballot paper.
Mr Reid
That is correct. However, two Members are elected: the first two. That is not first past the post.
The hon. Member for Central Ayrshire criticised the system for election to the Scottish Parliament in which the person who finished second in the constituency might still be elected on the list, but the same would apply under the strange system that he has come up with in the new clause.
Graeme Morrice
The hon. Gentleman has got this wrong. There would be two candidates—there could be two Labour candidates standing, or two Lib Dem, Tory or Scottish National party candidates—and the electors would have two votes. I would vote twice, and put down two crosses for two Labour candidates. There is not a second candidate, therefore; there are two firsts, and the electors have two votes—the two crosses.
Mr Reid
Yes, but some people might not vote for party tickets. This system is used in English local government elections, and it is very uncommon for the first two candidates to get exactly the same number of votes. One will finish first, and another will finish second, and sometimes where there is a close result candidates from different parties get elected.
Mr Donohoe
Even under the first-two-past-the-post system, it is highly possible that if a party candidate is unpopular for any reason, the electorate will choose one candidate from one party and another from a different party.
Mr Reid
Yes, that is possible, but there would still be two people elected, and the hon. Gentleman objected to having more than one person representing a constituency. He expressed objections about regional list Members holding surgeries in his constituency, but under the system he proposes there will be two people representing every constituency, so there are the same possibilities for disagreements and people duplicating casework. I find it illogical that the hon. Gentleman extols the virtues of first past the post, but proposes a different system.
The first-past-the-post or the first-two-past-the-post system could be very unfair. In the last Scottish Parliament election, the SNP got the most votes, and it rightly got the most seats. Let us consider what would have happened if we had adopted first past the post, however. In the constituency section, the SNP got 33% of the vote and Labour got 32%, but Labour won more than half the first-past-the-post seats—37 out of the 73 seats. Therefore, if we had purely been using a first-past-the-post system, even though the SNP was the clear winner of the election, the next morning we would have found we had a Labour Government with an overall majority, having more than half the seats.
Mr Reid
The hon. Gentleman takes the words out of my mouth: it would have been disgraceful gerrymandering if the first-past-the-post system had been adopted in that election, because in an election where the people voted for the SNP there would have been a Labour Government—and not just a minority Labour Government, but one with an overall majority. What is unfair about first past the post and first two past the post is that what counts is not the number of votes a party gets, but how they are distributed.
Mark Lazarowicz
Does the hon. Gentleman accept that if we do the electoral calculations, it is clear that had the AV system been in operation for the Scottish Parliament, the Labour majority would have been even higher?
Fiona O'Donnell
Does the hon. Gentleman agree that, once again, the constitutional cuckoo, the SNP, has benefited from a system drawn up by the Scottish Constitutional Convention, with which it did not even engage?
Mr MacNeil
I am listening closely to the hon. Gentleman’s arguments, and it is clearly game set and match against first past the post. In response to the point of the hon. Member for East Lothian (Fiona O'Donnell), does it not make the SNP victory all the better given that we won by a set of rules we did not even design?
Mr Reid
The SNP won because the election was fought on a fair set of rules—I hope that the hon. Gentleman will give the Liberal Democrats credit for participating in the Constitutional Convention and arguing and negotiating with the Labour party to get a proportional system. If his party had not gone off in a huff and had instead taken part in the Constitutional Convention, we might have got an even better system. He should be thanking the Liberal Democrats for the efforts we made.
The hon. Member for Central Ayrshire was arguing that one of the flaws with the current system relates to the number of MSPs who can turn up at health board meetings in Ayrshire and Arran—he cited a figure of 24. We have had arithmetical disputes before, but I calculate that 26 MSPs could attend. I have good news for him because the Boundary Commission has drawn up the new boundaries for the next elections and only 19 MSPs will be able to turn up to those meetings. However, he does have a point, and if he looks at the Arbuthnott report, he will find where a solution lies.
Sir John Arbuthnott’s report was set up by the previous Government to examine the problems of non-coterminosity. He proposed that we should make the regional list boundaries natural boundaries, rather than have the current unnatural boundaries. So, for example, the whole of Ayrshire would be covered by one regional list. There was a lot to be said for Sir John’s report. I did not agree with every part of the detail, but it was a pity that the previous Government did not take it more seriously. Importantly, the Arbuthnott commission said that when the overall result is proportional, it is less important that individual constituencies and individual regional lists all have the same number of electors than it is in a first-past-the-post system. As the final result will be proportional, it is less important for each constituency and list to be the same size. It would, thus, be better if the regional list boundaries for Scottish Parliament elections were drawn up first and constituencies were then fitted within the regional lists. That would allow us to get regional lists that are much closer to natural boundaries than the current system does.
Mr Donohoe
Will the hon. Gentleman concede that the biggest problem, in a party sense, of not having coterminous boundaries is that there is no accountability in respect of the list members, and that cannot be overcome on the basis of what he has just proposed?
Mr Reid
If the boundaries for the lists were natural ones, we would have much more accountability. For example, Ayrshire could be put with Dumfries and Galloway to form one regional list and we could, thus, have a much more natural boundary in south-west Scotland than we have at the moment.
Mr Davidson
I am listening with interest to what the hon. Gentleman is saying. He is arguing that if we have natural boundaries for the regional seats, it does not matter what size the individual constituencies are because we would have fairness overall. Such an approach would be very much to the benefit of the party, as it is a very party-focused means of coming to an arrangement. The parties would be doing okay, but we could have an enormous discrepancy in the “share” that any individual voter has of an MSP. I could be in a seat where there are 100,000 electors, whereas Orkney has just 14,000 electors, and clearly it would be expected that the person with only 14,000 people to represent would provide a much better service.
Mr Reid
That is a fair point. I would not propose having constituencies with anywhere near as many as 100,000 electors. Off the top of my head, I recall that the average Scottish Parliament constituency has about 55,000 electors, so the figure used would be close to that. Having individual constituencies that represent natural communities would make the work of the individual MSP much easier, because they would be representing a natural community, rather than a constituency that crosses a council or health authority boundary.
My preference would be to have the Parliament elected by the single transferable vote system in multi-Member constituencies—the same system that we use for local government. All MSPs would then be equal and we would not have the problem of conflict between constituency and regional list Members. I also outlined earlier how we could improve the present system. The important thing, however, is that we must have a proportional system in the Scottish Parliament. That is the only fair way for the whole of Scotland to be represented in the Parliament. It is what the Constitutional Convention agreed and what the Scottish people voted for in the referendum, so I urge the Committee to reject this backward-looking new clause and not to overturn the settled will of the Scottish people.
Pete Wishart (Perth and North Perthshire) (SNP)
I do not think that anybody in this House can doubt the tenacity of the hon. Member for Central Ayrshire (Mr Donohoe) on this issue. In the course of the past 12 years or so, he has been absolutely consistent in his contempt for list Members of the Scottish Parliament and the whole concept of proportional representation. I am sure that what he says about there being a large constituency for his views is true and I certainly saw a lot of people nodding along with his speech. I want to explore the issue today to try to see what level of support there is for his views, particularly in the Labour party.
The amendment was tabled in the name of the hon. Member for Central Ayrshire and in the names of five of his hon. Friends—a substantial and significant amount of Scottish Labour Members. An awful lot of Scottish Labour Members support the notion that this House should dictate the membership and voting arrangements for the Scottish Parliament. He also says that there is more support in the Labour movement more widely. If that is the case, it alarms and shocks me and we should hear more about it. If a substantial minority—
Pete Wishart
I will give way to the hon. Member for Edinburgh North and Leith (Mark Lazarowicz) first.
Mark Lazarowicz
I think that my hon. Friend the Member for East Lothian (Fiona O'Donnell) and I are going to make the same point. Arguments can be made—I hope to make them in a moment—against the exposition laid out by my hon. Friend the Member for Central Ayrshire (Mr Donohoe), but if the hon. Member for Perth and North Perthshire (Pete Wishart) is going to start playing the numbers game—we have had enough mathematics and arithmetic in the past hour or so—five out of 41 means just under one eighth of the Scottish Labour MPs, or less than 12.5%. Let us not overdo that argument.
Pete Wishart
I am grateful for that intervention, but it still seems an awful lot—almost an eighth, and there are six signatories. It also seems to me that the numbers are growing. I saw the heads nodding in agreement with the hon. Member for Central Ayrshire and I suggest and suspect that he has growing support. If he remains tenacious on this issue, his view might prevail in the Labour party. That is the direction in which things are going and that is what we are beginning to see.
Pete Wishart
I think that we have heard this point; is it on the same issue?
Fiona O'Donnell
I appreciate the hon. Gentleman’s enthusiasm for the subject. If I might help him with the maths, the equivalent proportion of Scottish National party Members would be seven eighths of one MP.
Pete Wishart
We really are having arithmetic and mathematics lectures today.
I think that the momentum is with the hon. Member for Central Ayrshire. Opinion is moving in the same direction as him and I think it is starting to go with him. I looked around and saw some of the enthusiasm from some of his hon. Friends this afternoon and I think the Labour party has a genuine problem. I have a solution, however, Mr Hoyle, in which you might be interested. I understand that the Labour party is holding an important conference this weekend, so the hon. Gentleman should get a day return—not the Caledonian sleeper—up to Oban and have this debate with the Labour party. The Scottish people need to know what the Labour party is doing.
I believe that the Labour party is split from top to bottom on this issue and that has to be resolved. I know that up at Oban it will be the usual whinge-fest.
Graeme Morrice
The SNP has a preoccupation with the Labour party; why does not the hon. Gentleman simply address the issue?
Pete Wishart
I am offering a solution so that the issue can be resolved and fixed up once and for all. The Scottish people want to know what the Labour party thinks. Labour designed this mechanism; let us see what it thinks about it now.
Mr Davidson
The hon. Gentleman has suggested that my colleague, my hon. Friend the Member for Central Ayrshire (Mr Donohoe), should take a train to Oban. The hon. Member for Perth and North Perthshire (Pete Wishart) is so up to date with current political affairs that he is unaware that the Labour party conference is in Glasgow. I would be grateful if he explained to us exactly how being in Oban would help my colleague to explain to his friends, meeting in Glasgow, why they should change their policy?
Pete Wishart
We are having a few difficulties with trains in this Committee. First there was the Caledonian sleeper and now there is this train to Oban. I will, of course, apologise to the hon. Member for Central Ayrshire. I say to him: “Take the train to Glasgow for goodness’ sake, but whatever you do, take that train, because we need to know the settled will of the Labour party in all this.” I suspect that the sentiment and views expressed by the hon. Gentleman are gaining currency in the Labour party—
Pete Wishart
People are nodding their heads. I detect that this is becoming a real issue. Frankly, it scares and alarms me if that is the debate within the Labour party. Whether it is a substantial minority or a majority within the Labour party who feel this way, the Scottish people need to know about this. They need to be aware that this is the Labour party’s intention. These two new clauses are totally wrong and it is appalling if a substantial minority in the Labour party believe this is the way forward. They would remove one of the central pillars of the Scottish Parliament—its internal democracy. They would remove all the proportionality that has been agreed and is the settled will of the Scottish Parliament.
Pete Wishart
I have given way to the hon. Lady already, so I will move on.
The hon. Member for Central Ayrshire and many of his colleagues want to return to the good old days of the old Glasgow council, when 69 Labour members, out of 79, were elected on 48% of the vote. That is democracy Labour-style—90% of members on 40% of the vote. Thank goodness we will not be going back to that. People are saying that is right and that it is what they want and I believe that that underpins all these measures—the Labour party benefiting massively from first past the post.
In the past few years, this issue has consistently come up. In the 10 years that I have been in the House, we have had these debates about Arbuthnott and other matters. We were told that we could not call the Scottish Government a Government and that we had to call them the Scottish Executive. I remember the days of the timid, unadventurous Labour Executive, always casting their eyes southwards to London, awaiting orders, instructions and directions about what to do, but those days have gone. We now have an SNP Government in Scotland and we will never again have the House of Commons clicking its fingers and the Scottish Parliament doing that dance. I look forward to that.
The Chairman of Ways and Means (Mr Lindsay Hoyle)
We are moving completely off the new clause and I think we ought to get back to it. I know that the hon. Gentleman has been tempted by all the interventions, but we ought to stick to the new clause.
Pete Wishart
I am grateful, Mr Hoyle.
I do not think that the signatories to the new clauses singularly loathe the additional member system—they also loathe the single transferable vote for local government in Scotland and everything to do with proportional representation.
Pete Wishart
That is their view. They want the death of PR in Scotland.
A few interesting things came out of the hon. Member for Central Ayrshire’s contribution, the most interesting of which was about list Members. I think he has to take this up with the Labour list Members in the highlands, in north-east Scotland and in mid-Scotland and Fife. I know that SNP list Members are particularly active within the larger constituencies and do a fantastic job.
Mr Donohoe
I shall try to be as quick as possible. I did not touch on this in my speech, but does not the list Member have to notify the constituency Member before they come in on a case or make notification of it? In the 12 years of the Scottish Parliament, in Ayrshire there has not been a single case brought to the attention of a constituency Member.
Pete Wishart
The hon. Gentleman will have had his own experiences with these issues.
An hon. Member has pointed out that there have been problems with list Members on a couple of occasions, but I am surprised that it is only a couple of occasions. List Members seem to co-exist with first-past-the-post Members on reasonably good terms. I recognise a number of issues and problems that have been identified by a number of Members.
Graeme Morrice
Further to my intervention earlier in the debate, is the hon. Gentleman aware of the situation of one Scottish National party MSP, Alex Neil, who was admonished by the Presiding Officer of the Scottish Parliament for giving the impression, despite the fact that he is the regional list MSP for Central Scotland, that somehow he was a local constituency MSP for Airdrie and Shotts, which has its own directly elected constituency MSP?
Pete Wishart
It seems that the hon. Gentleman feels it necessary to name others who cannot defend themselves in this House.
As I said, I am astounded that there have been so few such issues. That case is probably notable because it has happened so rarely. First-past-the-post Members have co-existed with regional Members in a friendly and consensual way. That is a feature of the Scottish Parliament that will continue.
The hon. Member for Livingston (Graeme Morrice) is right. There are difficulties identifying Members of the Scottish Parliament. I find it difficult to recognise first-past-the-post Labour Members in the Scottish Parliament, particularly those on the Front Bench, and I think the Scottish people have great difficulty recognising a number of them, too.
Pete Wishart
I will name one MSP with lofty ambitions. He has the ambition to be the First Minister of Scotland. When he went out there, we found that 50% of the Scottish people did not recognise him, and another 33% just did not like him.
Fiona O'Donnell
I wonder which party in Scotland the hon. Gentleman would say has the best record on constitutional reform—the parties in the Scottish Constitutional Convention, Labour and Lib Dems who delivered STV for local government, or an SNP Government who could not even deliver a referendum.
The Chairman of Ways and Means (Mr Lindsay Hoyle)
Order. That is not relevant to the new clause either.
Pete Wishart
The point was well made. The voting mechanism was not designed by the SNP, but we still won, which was remarkable. We hear Labour Members of Parliament down here disparage and knock the current arrangements. Those are their arrangements. When the Liberals were arguing in the Scottish Constitutional Convention—hon. Members may correct me if I am wrong—they would probably have been arguing for STV. That would be the preferred option. AMS was Labour’s system, which the Liberals agreed with in order to ensure proportionality. For Labour Members to make such a fuss about AMS now is a bit rich, given that it is their system. Our preferred system, if the hon. Lady wants to know, is full single transferable vote. That is what we want for Scotland.
Pete Wishart
I am sure that Mr Hoyle would not allow me to be tempted into discussing AV, but the mess that Labour Members get into when dealing with voting arrangements dumbfounds me. They seem to be for and against AV, just as they seem to be for and against proportionality in the Scottish Parliament. They are split from top to bottom on both issues, and they will be found out when they are questioned on the subject in the next few weeks.
Thomas Docherty
I appreciate that as the SNP’s Chief Whip, the hon. Gentleman believes in absolute loyalty to a single position. It might help him to understand that we have a free vote on the issue because we believe in a broad consensus.
Pete Wishart
I am no longer the Chief Whip, but I thank the hon. Gentleman for promoting me back to that distinguished role. I look forward to the outcome of a free vote in the Labour party. It will be fascinating. We will pay keen attention to who supports the hon. Member for Central Ayrshire in all this. I hope they are true to their convictions—[Interruption.] Oh, it is not a free vote, we hear.
The Chairman of Ways and Means (Mr Lindsay Hoyle)
Whether or not Labour Members have a free vote is not relevant to new clause 1. Let us get back to the new clause, and I am sure Mr Wishart would not want to keep repeating himself.
Pete Wishart
Indeed, Mr Hoyle. I hope I was not repeating myself, but I was interested in that free vote concept. I would love to have seen a free vote on the matter under discussion. I hope that the hon. Member for Central Ayrshire will press the new clause to a Division so that we get an opportunity to see who is for and who is against. Labour is totally split on the issue, and the Scottish people need to see where the Labour party is in all this. We in the SNP will of course oppose the new clause, because we believe in fair votes and in the right of the Scottish Parliament to make its own decisions and arrangements on voting and membership. That is how normal, self-respecting Parliaments do their business.
Mark Lazarowicz
I am sure that you will be pleased to hear that I intend to address the new clause, Mr Hoyle.
I want to put the case against what my hon. Friend the Member for Central Ayrshire (Mr Donohoe) has proposed, and to put the case for a system of proportional representation for the Scottish Parliament. The current system should be retained. We could have an interesting academic argument about whether to have the additional Member system or a different form of PR, but AMS is the proportional system that we have now in the Scottish Parliament, and I want to defend that system. Overall, it has worked well, and it should be retained in the interests of Scotland.
The first argument in favour of that system—or, indeed, any system of PR for the Scottish Parliament—is about fairness. I agree with the hon. Member for Argyll and Bute (Mr Reid) on that. Some people seem to take the view that fairness is a luxury for politicians. I do not accept that—fairness is something that we should all be concerned about. Any system in which the seats that one party wins can be grossly disproportionate to the votes that it gets is an unfair system. We have seen some of those distorting effects at the UK level, but at the Scottish level the first-past-the-post system could have much more disproportionate effects, precisely because of the multi-party system in Scotland. We have four parties in Scotland which, according to the opinion polls, get 6% or more of the vote—if we were to add the Lib Dems and their 5%, we would have a five-party system. With that breakdown between the parties, it would be quite feasible for a party with just 30% of the vote to get an absolute majority in the Scottish Parliament. Whatever our perspective might be, that cannot be justified or defended.
Some of my right hon. and hon. Friends take the view that because—as they believe—Labour tends to gain under that disproportionate system, we should support first past the post against any form of proportional representation. However, I do not accept that first past the post always benefits the Labour party. I am old enough to remember the 18 years of Conservative Government, when the Conservatives, never with the majority of the votes cast, nevertheless had a majority of the seats in Westminster, and sometimes a very large majority, so Labour does not always gain from the first-past-the-post system.
It would also be dangerous for my Labour colleagues or anyone else to assume that first past the post would always benefit Labour in Scotland. As the Liberal Democrats have discovered, no party can assume that its recent levels of support will be maintained indefinitely. Parties go up and down, and we cannot necessarily assume that if the Scottish Parliament had first past the post but no regional list system, the constituency votes in the last parliamentary elections would have been the same, because people might have chosen to vote differently if they had had only one vote instead of two. We cannot assume that Labour would always win an overall majority in the Scottish Parliament under first past the post.
Mr Donohoe
Does my hon. Friend understand that the last time the Liberals were in power, which was in 1921, they were opposed to any form of proportional representation and voted in this place for the system that we have today?
Mark Lazarowicz
Indeed. One thing that my hon. Friend and I share on this issue is consistency. He has been consistent in his opposition to PR; I have been consistent in my support for it, so at least we share something in this debate, unlike the Liberal Democrats.
No party can assume that it knows what the vote will be in five, 10, 15 or 20 years’ time, but the attraction—as my hon. Friends and others see it—of first past the post might diminish dramatically if, let us say, the Scottish National party at some stage got 35% of the votes in the Scottish parliamentary elections under that system. That could quite easily give it an absolute majority of seats, which no doubt the SNP would claim as a mandate for independence. Those who suggest that first past the post will always benefit Labour, or any other party, are making a serious mistake if they maintain that position.
Cathy Jamieson
So far the debate seems to have centred on what is best for the political parties. Does my hon. Friend agree that one of the problems with the voting system we now have for local government, for example, is that people feel that they have lost the direct link with their elected representative? They prefer a system in which there is certainty; they know who to go to and do not feel that they are being passed from pillar to post.
Mark Lazarowicz
I agree. That is one reason why I do not support STV for the Scottish Parliament or local government, and I will come on to that point as it relates to the Scottish Parliament in a moment.
We should bear in mind some of the arguments made in 1997—those of us who have been around for some time can remember them—on why it was important that there should be a vote on the system of PR in the referendum on the Scottish Parliament, rather than putting a first-past-the-post system to voters. That is precisely because it was recognised, even by some people who were hostile to or sceptical about PR, that if the electors had been offered a choice of a Scottish Parliament with a first-past-the-post system, some might have voted against it because they would be concerned that one party in one part of the country might at some future stage dominate the Parliament, which would have undermined support for the yes vote in the 1997 referendum.
Pete Wishart
Looking around the Chamber, I see four Labour Members who are against the hon. Gentleman and three who support him. Does he feel that in the Labour party he is beginning to lose the argument in favour of PR?
Mark Lazarowicz
I am not sure that I understand the hon. Gentleman’s point—
Mark Lazarowicz
I think that we are going down a road that will not take the argument much further forward.
When the Constitutional Convention drew up the plans for a Scottish Parliament, there was a strong case that the Parliament should be elected by a system of PR, and there is certainly no case for changing that, even if we look at it simply from the narrow point of view of Labour’s party political advantage, which, as I have said, we should not do. It is also about how democracy can be improved and how the public relate to the political process, as my hon. Friend the Member for Kilmarnock and Loudoun (Cathy Jamieson) has said.
If we accept that there should be some system of PR for the Scottish Parliament—I know that there are Members on both sides of the House who do not accept that—the obvious question is which PR system should be put in place. There is a wide range of PR systems, as there is a wide range of electoral systems generally, and there are arguments for and against all of them. My hon. Friend the Member for Kilmarnock and Loudoun has pointed out some of the disadvantages, and I agree with her about the STV system that currently operates in local government. Some council wards in my constituency, for example, now have 28,000 voters, and so local councillors are in no sense local in the way that they had been, and I presume that that is the case in her constituency.
If we had an STV system for Scottish Parliament elections, Edinburgh would have four MPs for the entire area, but no local MPs. There might be two Labour Members, one Tory and one SNP, according to present opinion polls, but that would certainly not allow any of them to have a local affiliation in the parts of Edinburgh where there is a strong local identity, such as my constituency of Edinburgh North and Leith. STV would certainly not be the right answer. I do not think that anyone would seriously go for the complete proportional list system in which seats are allocated to parties simply on the basis of the number of votes received nationwide. That would give too much power to the parties, so no one would support that system. Therefore, the additional Member system, which combines the constituency element, so that people know who their local MSP is, and the top-up level, which balances out the disproportionate effects of the first-past-the-post system, is in my view the best compromise, which is why it should be maintained.
There are certainly problems with how some list Members operate. I could refer to one Member in my region and the way in which she has presented herself in the run-up to Scottish Parliament elections, and other examples could undoubtedly be provided from across the country of MSPs from different parties acting that way.
In my case, I have been fortunate, but by and large we have had no great problems of representation in working with list MSPs. There are times when we have political disagreements, but there are also times when we can work together in the interests of the area. Perhaps I have just been fortunate, but I do not think that there have been the dramatic difficulties that my hon. Friend the Member for Central Ayrshire has suggested.
John Thurso (Caithness, Sutherland and Easter Ross) (LD)
I rise briefly to reach out a cooling and, I hope, reassuring hand to the fevered brow of the hon. Member for Perth and North Perthshire (Pete Wishart) regarding his concerns about the comments made by the hon. Member for Central Ayrshire (Mr Donohoe).
Before I do that, I make one observation. I had the privilege of doing a great deal of the Committee and Report work in the other place on the original Scotland Bill, and I acknowledge that we made one mistake. We agreed to allow the Scottish Parliament itself to decide and work out the relationship and work loads between all the different MSPs, and that there should be equality between the list and the constituency. It should be the Parliament’s job to work that out, but it would have been helpful had we given it a steer at the beginning as to a better balance, because I recognise some of the comments about squatting, although the majority of list MSPs do an exceedingly good job and the system overall brings fairness and proportionality. In the other place, we lost a vote that my noble Friends—at that stage—put for an open-list system, which I would have preferred, but we ended up with a broadly fair system that has worked well and come of age.
Now, let me reassure the hon. Member for Perth and North Perthshire regarding the comments of the hon. Member for Central Ayrshire, who moved the new clause. The key is in his comments regarding history. First, he invoked the election of 1910, when 83% of Scots voted, as opposed to 2010, when only 64% did. Of course, he forgot to mention that we did not have universal suffrage at that point, and, indeed, that no women had the vote or could stand for Parliament. So, his first suggestion is, I think, that we should get rid of women from politics.
Secondly, the hon. Gentleman’s new clause sets out “Two members” with “two votes” and two posts. Of course, we had that system in British politics for many years during the century before last, with some very interesting results, so there is nothing new there. Indeed, many people had two votes in different constituencies if they happened to have gone to Oxford or Cambridge.
So, the clear direction of travel of the hon. Gentleman’s thinking is back to the future, and there are only two explanations for that. Either he is the last surviving relic of first-past-the-post-osaurus rex, or his contribution was a wonderful exercise in irony. I believe that he is a grandmaster in irony, and that explains the new clause.
Mr Davidson
It is true to say that the devolution settlement achieved at the time of the referendum represented the settled will of the Scottish people, but that does not mean that there can never be any further change of any kind. In our debates on the Bill, we have identified difficulties and we have tried to resolve them and to move things forward by making changes. On the question of the electoral system, we first have to ask whether there are any problems and, if there are, whether there is a solution.
I believe that there are some difficulties with the existing system. For example, the public have never entirely understood how losers become winners. They see people standing for election in a constituency and losing, only to pop up as an MSP anyway. The situation is made far worse when some of those who lost pretend to be the MSP for the constituency in which they stood and were defeated. That was certainly the case for a considerable number of years in Glasgow Pollok, where Johann Lamont was elected by first past the post. Kenny Gibson, from the SNP, who came second, then pretended to be the local MSP. Tommy Sheridan, from the horizontal road to socialism party, who is now detained elsewhere, also pretended to be the MSP for that constituency. That was undoubtedly unhelpful, because different people would turn up at local meetings, events, protests and campaigns pretending to be the MSP. This is a genuine issue that needs to be addressed.
We have already heard the outrageous story of Alex Neil printing posters saying that he was the MSP for Airdrie and Shotts when patently he was not. That was a deliberate attempt to deceive the electorate. The fact that there is an election coming up in the near future can only be coincidence, but that was none the less a deliberate attempt to deceive. We also had a situation in the Govan constituency, the one beside mine, where Nicola Sturgeon camped out. She has now won that seat, but she did so partly because she had pretended to be the list MSP for that constituency. These are all clear difficulties in the present system and they need to be looked at.
Related to that problem is the cherry-picking not just of issues but of individual items of casework, especially in relation to immigration cases but to others as well. As an MP, I have had a string of cases in which MSPs have taken up people’s complaints about immigration, told them that they could do something about it, led them down a path that led nowhere at all, then told them to come and see me. By that time, a considerable period had passed and some of the people had consulted lawyers based on what they had been mis-told. The same thing has happened with social security cases. We need a change in the rules that would stop list MSPs, in particular, cherry-picking.
Pete Wishart
The hon. Gentleman has listed certain instances of transgressions by SNP regional list Members. What is the Labour party doing?
Mr Davidson
My understanding is that list Labour MSPs are perfect in every way and have done nothing incorrect or outside the rules. I presume that there are no examples of Labour MSPs misbehaving in such a way; otherwise, we would have heard about them. The fact that the SNP has not raised a single example of a Labour MSP doing anything untoward is an indication of where the balance of advantage in this argument lies.
A further difficulty with the existing system is the way in which getting on the list is so key to success in the proportional representation section of the ballot. That means that the party machine, which controls access to the list, has a much greater say than the electorate in who goes to the Scottish Parliament, because the electorate can only vote for the list—they have no say in who is on it. The loyalty of those who are on the list must therefore be directed not towards the electorate but towards their party managers; otherwise, they run the risk of being put off the list next time.
Mark Lazarowicz
I do not quite see the strength of my hon. Friend’s argument. In the Labour party, the members choose the ranking of people on the list, but they choose the candidates for first-past-the-post seats as well, so I am not sure how the party is given more power in one situation than in the other. Earlier, he highlighted various deficiencies in the list system, and he may be right. However, those may be arguments for changing the additional member system, but surely not for getting rid of it entirely.
Mr Davidson
Let me come on to that. At the moment, I am identifying particular difficulties. My hon. Friend perhaps misunderstands my point about the allegiance of people on the list. He is absolutely right that, certainly in the Labour party, it is the membership who determine someone’s place on the list. However, it is often the party hierarchy who determine whether that person enters the ballot to decide whether they are placed on the list, so it is about how that is handled. Increasingly, party managers have had a tendency to try to control who is on that list.
Mr Weir
I am interested in what the hon. Gentleman is saying. Will he clarify how someone in the Labour party can get to the stage of being able to stand for any seat whatsoever? Surely he would have to be approved by the party in some way before he is allowed to go forward for a seat. I am struggling to see the difference.
Mr Davidson
The hon. Gentleman is obviously struggling to see the difference because he is unaware of the extent to which the Labour party’s internal democratic mechanisms are a wonder to behold. I do not necessarily see why I should share in private grief.
Mr Davidson
Indeed it did. I can think of several other Members of Parliament here today who were prevented from standing for the Scottish Parliament candidates list. That was in the days when new Labour was at its most sectarian. Fortunately, we have moved on, and that is to be welcomed. The hon. Gentleman is absolutely correct—that was a difficulty. The Labour party’s initial lists were drawn up in a sectarian fashion, and therefore a lot of people who would otherwise have been considered suitable for consideration by the party membership were unable to come forward.
Another difficulty about the existing system is the way in which vacancies are filled. It is absurd that when somebody on the list stands down, disappears, passes away or decides that they want to do something else, the person who gets that place is simply the next one on the list. There is no vote and the public are not involved in any way, unlike the situation for individual constituency Members. That is inappropriate and a fault in the system.
Mr MacNeil
Is not the point of that process to retain the proportionality in the Parliament that was established by the voters at the election?
Mr Davidson
That is a natural result of the system—I understand that—but that is what I am unhappy about. It does not seem fair or reasonable that at some point after the election, during the term of the Scottish Parliament, somebody who is not an MSP should, as if by magic, become an MSP without the involvement of the electorate in any way.
Mr MacNeil
Does the hon. Gentleman think it in any way important, then, that the proportionality expressed by the electorate is maintained in the Parliament?
Mr Davidson
These are difficult issues. I accept that that is a valid point, but I am unhappy about the idea that by-elections do not take place. By-elections are an important way of telling us what the public think at any particular moment. I do not know whether people present are aware of what happened recently in Barnsley, which was enormously significant.
Mr Davidson
Okay. The party that had been second at the general election was not second, and it did not win the seat.
The Chairman of Ways and Means (Mr Lindsay Hoyle)
Order. I am not quite sure what is the relevance of Barnsley. The Committee is well aware of the Barnsley result without Mr Davidson going into further detail.
Mr Davidson
I accept that decision, although I regret it because this is an important point. Its relevance is that, if there were a vacancy in the Scottish Parliament, under the existing system there would be a by-election, as in Barnsley, if it was a first-past-the-post seat, but not one if it was a list seat. The electorate in a constituency that I will not name had a way of telling the country what they thought of the Liberals. I think that that was important. We are much better and wiser for knowing that. I will not say the position in which the Liberals came, and I will not say what would have happened if the Democratic Unionist party, the Scottish National party or the Welsh nationalists had stood. [Interruption.] They would have come ninth if they were lucky, and that is assuming that the Social Democratic and Labour party did not stand. I understand that they might well have been beaten by the 1st Barnsley Girl Guides and the Bonzo Dog Doo-Dah Band had their candidates stood, but I must move on. The point is that by-elections allow people to express a view as progress is made throughout the term of a Government. The existing system does not allow that.
It is important in a democracy that the electorate can get rid of people. I have a list here of people whom I would quite like to get rid of. However, it will be impossible to get rid of Nicola Sturgeon, for example, at the forthcoming election. She is standing in her constituency as the first-past-the-post candidate and she is at the top of the SNP list. Unless the party gets no votes at all, she will be returned. She does not need to turn up, because she is going to be elected. That seems fundamentally unfair and unreasonable.
Mr Davidson
I am perfectly happy to say that I want the system to change so that no party can do that. The hon. Gentleman’s question is a bit like asking somebody whether they are in favour of electricity being privatised, and if they say no, asking why they do not use candles. We operate in the world that exists. Although one might not have wanted a change to happen, one must accommodate the new position once it has. It is therefore perfectly reasonable for Labour candidates to stand in whichever way is appropriate. That does not stop us saying that the system ought to be changed.
The question is whether the solution that is proposed is right. It has some merits, such as establishing a clear link between individual voters and the people who are elected in their constituency. I have some reservations about having two Members per constituency. I can see how that proposal has come forward for administrative convenience. I can see the merit of splitting each Westminster constituency either north to south or east to west, so that each person is represented by only one MSP and one MP.
I can also see the merit—I am disappointed that this has not come up before—of seeking gender balance, by having two votes for each Westminster constituency, with one for a man and one for a woman. The Scottish Parliament lacks the gender balance that is desirable. In the first selection of candidates for the Scottish Parliament, the Labour party chose to twin the first-past-the-post constituencies so that one man and one woman would be selected. In the list, men and women were put alternately. With individual reselections and so on, that practice has lapsed a bit. However, I think that we were the only party to do something like that. The lack of women representatives in the other parties is a major deficiency. Changing the system would be advantageous in that regard.
My hon. Friend the Member for Central Ayrshire (Mr Donohoe) mentioned voter confusion. The system of having two Members per constituency, however they were provided, would avoid the situation of 25 or 28 MSPs turning up to meet the health board. That is an absurdity. It is grossly inefficient and simply serves to muddy the waters. We should therefore consider changes and a better way.
It is often argued that proportional representation encourages more people to vote. In fact, the UK voting system that is most proportional is for elections to the European Parliament, which have the lowest turnout. The next most proportional is the local authority system, which has the second lowest turnout. Then come the Scottish elections, for which there is an element of first past the post, which have the second highest turnout. The highest turnout is for elections to Westminster, which are the least proportional, so there is a clear correlation between first past the post and electoral turnout.
Mr Davidson
Those facts help my case, so I am quite happy to take interventions on that point.
Mr MacNeil
I fear that the hon. Gentleman might be confusing cause and effect. Surely turnout is more about the media attention given to whatever election happens to be occurring. The European elections get the least media attention, if any at all.
Mike Crockart (Edinburgh West) (LD)
If the hon. Gentleman’s argument were correct, surely local government elections would have had immensely large turnouts when first past the post was used for them, and the turnout would have dipped immensely when they changed to the single transferrable vote. That was obviously not the case—there were poor turnouts before the change.
Mr Davidson
Turnouts have dipped since the change to proportional representation, as I understand it. The situation seems quite clear.
Mr Davidson
Is it not interesting that in debates about changing the voting system we were always told that changing to a proportional system would boost the turnout? In fact, if anything, the reverse is true. I accept much of the argument made by the hon. Member for Na h-Eileanan an Iar (Mr MacNeil) about media coverage, and I recognise that the situation is more complex, but those who argued for proportional representation never made that point. They suggested a clear correlation that has been demonstrated to be untrue.
Graeme Morrice
Is my hon. Friend aware that at the general election in May, turnout under first past the post increased by about 4%? It is going in the right direction.
Mr Davidson
That is an excellent point, and I am glad that it has been made.
Pete Wishart
On a point of clarification about the supremacy of first past the post, as the hon. Gentleman would have it, is he saying that no other electoral system throughout the world brings out a greater number of voters for a national general election?
Mr Davidson
I will not say that, because I suspect hon. Members could cite the case of Albania or somewhere similar. However, in our case it seems pretty clear that there is a correlation between turnout and the simplicity and comprehensibility of first past the post.
Let us not confuse ourselves about how the system that we have in the Scottish Parliament came about. It was not on tablets of stone brought down from the mountain by Moses; it came from a backroom deal between the leaderships of the Labour party and the Liberals to ensure that they had a majority. That is no more than has happened between the Liberals and the Conservatives in the coalition. It is a shabby deal which, as the hon. Member for Argyll and Bute (Mr Reid) said, involves compromises. Let us not sanctify the electoral system with a false impression that a popular uprising demanded it.
Pete Wishart
AMS was Labour’s preferred system at the constitutional convention. What is interesting about the hon. Gentleman’s remarks—I hope he will come to this point—is that he believes that this place should dictate to the Scottish Parliament the ending of the current voting arrangements and the existence of regional Members. Would he like to impose an end to proportional representation on the Scottish Parliament?
Mr Davidson
I havenae decided what is the best system. I have outlined faults in the existing system. Do I believe that this House has the right to decide the voting system for the Scottish Parliament? Yes, I do, actually.
Mr Davidson
Yes, I think it should, in exactly the same way that the Scottish Parliament decided the voting system for local authorities without any discussion or agreement. If the Scottish Parliament is to be allowed to decide its voting system, so should local authorities. It is good enough for the SNP and its allies to impose a system on others, and what goes around comes around.
Mr MacNeil
May I tempt the hon. Gentleman, who I know is a committed Europhile, to extend that logic? If the Scottish Parliament foists a system on local government, and if the UK Government foist a system on the Scottish Parliament, would he want the European Parliament to foist an electoral system on the House of Commons?
The Chairman of Ways and Means (Mr Lindsay Hoyle)
Order. That is a temptation, but this is about the abolition of regional Members. We are in danger of being dragged around Europe, Scotland and the UK, so I think we should get back to new clause 1.
Mr Davidson
A very bad boy was trying to tempt me down the highway, Mr Hoyle. Earlier, I heard an SNP Member shouting that they wanted Scotland to join the euro as soon as possible, but that is nothing to do with this debate either, and I therefore do not intend to bring it up.
The deal was a backroom deal and the old politics, in exactly the same way as the coalition was the old politics. Just as the Liberals were bought off for the Scottish Parliament, so they have been bought off with the promise of AV for this Parliament. I noticed yesterday a whole string of Liberals wearing “Yes to AV” badges. I will not mention that now, but come back to it in a later debate—
The Chairman of Ways and Means
Order. We are going to discuss the abolition of regional Members. We are not going to be dragged back or come back to that other matter later; we will stick to new clause 1. We need to make progress. I think Mark Lazarowicz was about to intervene on you, Mr Davidson. Are you giving way?
Mark Lazarowicz
I am grateful to my hon. Friend for giving way and I shall certainly not tempt him off the straight and narrow. On how the electoral system for the Scottish Parliament was adopted, the fine details were a result of detailed discussion within the Constitutional Convention. Surely my hon. Friend accepts that the final system was endorsed by the electorate. The principle of having a proportional system for the Scottish Parliament was worked out at length through debate and consultation—it was certainly not the product of a backroom deal, but the product of many months of discussion and public consultation. As he knows, the Labour party conference voted 2:1 in favour of the final deal after the final agreement between the parties in the convention.
The Chairman of Ways and Means
Order. We do not need reports on the Labour party conference, so I think we will get back to new clause 1.
Mr Davidson
None the less, my hon. Friend’s point relates to whether it is possible, without inviting thunderbolts from on high, to consider changes to the electoral system for the Scottish Parliament. It seems to me that that is desirable. We regularly examine other elements of the Scottish Parliament and aspects of devolution—I remind hon. Members that devolution is a moving feast and not static—and so we should examine the electoral system.
I do not intend to vote for new clauses 1 and 2, which were tabled by my hon. Friend the Member for Central Ayrshire, because I am not convinced that his proposals are the correct way forward. However, there is something wrong with the existing system, and it needs to be changed.
Michael Connarty (Linlithgow and East Falkirk) (Lab)
Anyone who looks at the amendment paper will see that I am a signatory to new clauses 1 and 2. We have had the knockabout stuff about whether this Parliament has or has not the right to decide the structure of the Scottish parliamentary electoral system or indeed its membership, but people were perfectly happy for this Parliament to overturn the Scotland Act 1998 at the first time of calling, by increasing the number of Members to 129, when the Act originally said that we would drop to a reasonable number after the initial period. The argument was made that people in the Scottish Parliament thought they needed 129 Members to take up all of the one and a half days in which they actually debated in their Chamber, and to ensure that enough people turned up at 5 o’clock every Wednesday to vote to make sure they got the tick in the box.
It never made sense to me, but we allowed that change; Parliament was perfectly happy to change it. I believe that Members of all the parties with Members in Scotland were happy to go along with that process. If it was good enough then, it is certainly good enough now to consider whether the system in place for proportional representation—with its list Members—is the correct way to proceed. I am sure that some, such as my hon. Friend the Member for Edinburgh North and Leith (Mark Lazarowicz), would like to proceed to a totally proportional system. I believe that that has always been his bent; the single transferrable vote has always been his choice of political electoral system.
Mr MacNeil
I wonder whether the hon. Gentleman underestimates voters and the public when he says that they have difficulty distinguishing between list Members, who might have stood and lost, and those who have won on a constituency basis. I have not come across anyone who has had any difficulty understanding the process.
Michael Connarty
I would not want to accuse the hon. Gentleman of trying to distort my words; I just think he might not be swift enough to understand them. I said that people resent it. They know that they did not choose the Member who lost under first past the post, and they are not happy that that person then turns up as a list Member. They believe it is important that when they make a choice under first past the post, they choose between candidate A and candidate B. I take the point made earlier that every party does it, but it is wrong because it distorts the will of the electorate.
Mr Weir
The hon. Gentleman is making the point that several of his colleagues have made about people who lose under first past the post and come back on the list. However, does he not accept that it is a different electorate? Regional seats have seven or eight first-past-the-post seats in it, so they are not being elected by the same electorate. I do not understand his objection.
Michael Connarty
The point is that when the electorate then see that person’s behaviour in the list system, they are puzzled. I give the example of the Lothian Members, who are centred mainly in the city of Edinburgh. Where do the SNP list Members have their office? They have it in a little village called Whitburn in my constituency—well out of the city centre and the locale near the Parliament. That might have something to do with the fact that every time we have an election, the person who loses for the SNP stands against my MSP under first past the post, and that constituency happens to cover the village of Whitburn and areas in West Lothian. That clearly distorts not only the electoral system but the use of resources allocated to list Members, basically to try to back up the challenge under first past the post. New clause 1 would remove that problem by providing for two Members for each MP seat—it could be split in half or done some other way. That would give people the sort of representation that they like.
I have no doubt that colleagues in all the political parties in Scotland believe that when people come to see them, they know that they are their representatives and that they are accountable to those people. In the Scottish parliamentary system, however, people do not really know because of the number of layers involved. They might go to the list Member, and if they get nothing there they will try the first-past-the-post Member and vice versa. The list Member might first back up the person and then take a different view. Then it might come to seeing the Member of Parliament to find out whether they will back them up.
Graeme Morrice
I am grateful to my hon. Friend, who represents a constituency in the local authority area where I have a constituency. I certainly share his views and concerns on this matter and I empathise with his viewpoint. Does he agree, however, that the real problem is the absolute confusion among the electorate about the difference between constituency MSPs and regional list MSPs? Within Scotland, possibly 99% of the electorate, if asked, would not know who all their regional list MSPs were.
Michael Connarty
That is an easy question to answer. It is quite clear that most people in this Chamber, if asked to list them, would not know all the regional list MSPs in their area. That is not the way I like to see the issue, however. It is not so much about confusion among the electorate; it is more that the electorate are not well represented. It is not because they are confused, but because the system invites certain behaviours that run counter to good representation. People do not know who is accountable to them and it is quite clear that list members are not accountable to the electorate. They are accountable to their party, because it is the party that puts them on the list and into the system.
Michael Connarty
I am not giving way yet.
If this is about the electorate—I hope it is, rather than about the manipulation of party machinery—it is important that the electorate know who is representing them. The system at the moment is not clear—indeed, it is deliberately confusing for the electorate. It has nothing to do with the intelligence of the electorate; it is a matter of how all the political parties use the list system. We should genuinely consider moving to a system that can be recommended for its clarity. Having two constituency Members for the Scottish Parliament and one Member for this Parliament would be correct and clear, and people would like it.
What has happened is that people in this place do not care whether the electorate like it or not. This is the key point: they do not treat the electorate properly. I have to say that the SNP argument is completely flawed. It has nothing to do with whether SNP Members respect the electorate; it is about whether their party can get an advantage out of it. It is the same with all minority parties. If my party acts in the same way, it is equally wrong. I therefore believe that new clause 1 deserves serious consideration and support. If parties want to top up to a certain number because they cannot run the place without 129 Members, that is where the additional Members should come from. We should call these people what they are—party-nominated Members. That is what happens in Germany: people are nominated by their parties to appear on the list to stand for Parliament or for the European Parliament. People are clear about what they are getting, but what they are not getting is representation.
On new clause 2, the use of resources must be controlled in some way. In Scotland, people are running party machinery in constituencies using the list system resources. To have an office in Whitburn, someone should be representing all the Lothians. For that office to be used only for one Member who is trying to become the first-past-the-post Member for the Linlithgow constituency is the wrong use of resources—and we must find some way of controlling that.
Stewart Hosie
The hon. Gentleman makes that allegation, so can he confirm that this is a parliamentary office for list Members and not a party office?
Michael Connarty
My understanding is that it is an office used by the Member of the Scottish Parliament, who happens to be the person who keeps standing for election to the constituency under first past the post. That may be coincidental; it may be that it is so difficult for the other Lothian Members to get public transport from the centre of the city to the office that they use it solely as a telephone base.
It is important for us to bear in mind the aspiration of the House of Commons that list Members should represent a party that will use them in a way that bolsters the process in the Parliament, rather than shattering and scattering them throughout Scotland and sending them scurrying after votes in the hope that they might at some point secure a first-past-the-post seat, or perhaps secure some proportional extra seats for their party by being seen to be more active. That is not the vision that I was sold in the Scottish Constitutional Convention, it is not the vision that was presented here, and it is not the vision conveyed to me by Scottish National party members at that time. Why are SNP members now willing to accept a second-class option rather than delivering what we promised to the people of Scotland?
Stewart Hosie
I asked a simple question. I will repeat it. Is that office a list parliamentary office paid for with parliamentary resources to enable list Members to do their parliamentary work, and is it within the region to which they are elected?
Michael Connarty
The arrangement is perfectly legal under the present system. I am saying that the system should be more constrained and more disciplined, and that the resources should be more focused. I believe that the public are questioning why the office is there, what its purpose is, and whether it constitutes a distortion of what is due to them, the electorate. I keep returning to this point. What did we promise the electorate? What we promised them we have not delivered, and we should therefore consider doing something better. The new clauses represent serious challenges to the existing system, and should be treated as such.
Pete Wishart
Notwithstanding the fact that AMS was the Labour solution in the Constitutional Convention, there is another elegant solution to deal with a number of the hon. Gentleman’s concerns. Under STV, there would not be two distinct categories of Members of the Scottish Parliament. However, I presume that he wishes to end proportionality and return to Labour fiefdoms such as Glasgow council, 90% of whose members received 40% of the votes. Is that what he wants?
Michael Connarty
I should like Glasgow city council—which is a wonderful council—to be properly resourced, rather than having its budget cut by 3.7%. That is what the Scottish Government have just done, at a time when the city needs more resources. Other areas with a large proportion of SNP councillors are experiencing very small cuts. That is another abuse for which the people will take the Government of Scotland to task, and will take the SNP to task in particular.
Proportionality has not worked in our system. I do not approve of the single transferable vote. I do not believe in that kind of proportionality, because I think that it moves so far away from the idea of accountability that the public reject it, and I do not think that we will get very far with any other amendment that appears to distort what we have in the House of Commons at present. When a Member of Parliament is elected, he or she is accountable. People know whom they elected, why they elected them, and how to get rid of them. If we cannot introduce a system that provides some credibility, the Scottish Parliament will go spinning off into the future with no credibility at all. I therefore hope that the Committee will pass new clauses 1 and 2.
David Mundell
I welcome you back to the chair, Ms Primarolo. I hope that, unlike the hon. Member for East Lothian (Fiona O'Donnell), you did not have a sleepless night in anticipation of the debate. Given the level of interest that has been expressed, the hon. Member for Central Ayrshire (Mr Donohoe) has clearly done the Committee a service by promoting a debate on these issues.
Let me say at the outset that the Government will not support the new clauses, principally because we believe that a fundamental part of the devolution settlement that was voted for in the 1997 referendum was the agreement that the Scottish Parliament should be elected on a proportional basis. There is a range of debates to be had on issues relating to proportionality, and some of those issues have emerged this afternoon, but it is clear that a fundamental aspect of the Scottish Parliament is that it is a proportionally elected institution.
I must confess that during my time in the Scottish Parliament I was a regional list Member. Therefore, I must defend that cadre. Many Members from all the main political parties in Scotland have served with distinction as regional list Members, including Peter Peacock, who served on the Scotland Bill Committee, and Lord Foulkes, who was mentioned in our debate yesterday. We should not accept any general diminution of their contribution to the Scottish Parliament, as they have played their roles.
Stewart Hosie
Is that not the argument that was being used earlier: that losers can become winners? Why would a Labour Member make that case, when the Minister is explaining that that is precisely what the Labour party is now doing?
Mr Donohoe
May I make it perfectly clear that I am opposed to the position referred to by the hon. Member for Dundee East (Stewart Hosie), as is my constituency party and as are many other constituency parties across Scotland?
David Mundell
I fully take on board what the hon. Gentleman says, and I praise his consistency on this issue, but others who have been critical of the regional list system now want to use it to save their political careers, and I regard that as hypocrisy.
David Mundell
As has been said, there has been a change from the view that Members should not stand on both the list and in constituencies to a position where that should be done when it is in someone’s self-interest.
Mr Tom Harris (Glasgow South) (Lab)
I apologise for not being here for the debate before now, but I wish to clarify one matter. I hope the Minister will recall that in the first Scottish Parliament elections Donald Dewar stood as a candidate for Anniesland, in addition to being No. 1 on the Glasgow list. A number of prominent first-past-the-post candidates also stood on the list, so this is not a new procedure in the Labour party—it has been going on since 1999.
David Mundell
As I recall, the reason given for Labour Members taking that approach was that they were encouraging people to vote on the list; they were seeking to demonstrate that prominent people were on the list and so it was an important vote in which to participate.
Mark Lazarowicz
Will the Minister remind us whether there are any Conservative list MSPs standing for a first-past-the-post seat in the forthcoming elections?
David Mundell
Indeed there are, but the Conservative party has been clear and absolutely consistent in its policy. It has not changed its policy to suit the electoral needs of individual constituency MSPs who fear for their future.
Pete Wishart
The Minister rightly says that the Conservatives have been consistent about this—the list has saved the neck of the Conservative party in Scotland. Has he any idea what the Labour Front-Bench team’s position is on this matter? We have not heard a contribution from Labour Front Benchers on this; all we have heard are the siren voices of the “first-past-the-posters” at the back. Labour seems to be split from top to bottom on this issue, but does the Minister have any idea as to its view?
David Mundell
The hon. Gentleman probably shares my belief that the Labour party view will be what is in the interests of the Labour party, and not necessarily what is in the interests of the electorate in individual constituencies in Scotland.
Michael Connarty
I am glad that the Minister gave way after that terrible slur on the Labour party. We are talking about the views of Members of this House, and it is very important that we take them seriously and do not start messing around. It is clear that the parties had a view. I recall Donald Dewar saying that the idea was that, as in Germany, the leader of the list would be seen as a symbol of what the list stood for. All the arrangements were proportional in Germany, but because we had this divergence between the first-past-the-post and list systems, our arrangements became totally confused in the eyes of the electorate. We are not seeking party advantage; we are looking for the electorate’s advantage.
David Mundell
I recognise the hon. Gentleman’s consistency on this issue, but I was confused by one of the contributions from the hon. Member for Kilmarnock and Loudoun (Cathy Jamieson), who was part of a Labour-led Scottish Government who introduced the single transferable vote into local government in Scotland. Much of the argument that I have heard today did not provide evidence that that was done on the basis of support from within the Labour party. As one Member on the Opposition Benches pointed out, it was also done without consulting people across Scotland. On the point that the hon. Lady did raise, may I say, for information purposes, that when a council by-election is required, the STV system used does not guarantee ongoing proportionality? One of the problems with STV systems is that by-elections are difficult and complex matters.
Mr Davidson
A moment ago, Mr Kettle accused members of the Labour party of coming to a position based on self-interest. Given that he is in an alliance with another bad lot to promote an alternative vote referendum, despite neither party preferring AV as an electoral system, it can hardly be said that other people are pursuing their self-interest in this matter. Might I add that, to be fair, the Liberals welcome AV, because they predict that they will have a better result than they achieved in Barnsley and will at least come second in the referendum?
The Second Deputy Chairman of Ways and Means (Dawn Primarolo)
Order. May I add that I would like the Minister to return to discussing the new clause?
David Mundell
Thank you, Ms Primarolo. I will take on board what you say and, as ever, I note the hon. Gentleman’s comments. Some of what he said in his contribution was helpful, in that there is an acceptance, following the Arbuthnott commission’s report, that some form of review of electoral systems in Scotland is required. The Arbuthnott commission suggested that that should take place post-2011, and the Government share that view.
Mr Donohoe
I am sure that the Minister will concede that nothing I am proposing today would come into effect until after this year’s elections.
David Mundell
The hon. Gentleman has proposed a very specific change to the electoral system for the Scottish Parliament. It would mean that two Members would be elected from each constituency other than the three constituencies that have been identified. Although it seems to suggest that everyone would have two votes in those three constituencies, the new clause does not appear to show what would happen to the second of their votes. He has set out his intentions in this debate, but the provisions are technically defective. However, I advise him, and the Opposition Members who have expressed clear views about how they would change the electoral system for the Scottish Parliament, to take part in any review that is forthcoming on the nature of that electoral system. That is one basis on which the Government reject the new clauses.
Cathy Jamieson
I am listening to the Minister with interest. Is he actually offering that very review that he is talking about? If so, when will it take place?
David Mundell
The date of the next Scottish Parliament election has changed as a result of the Fixed-term Parliaments Bill, and the Government have indicated that a review of the implications for the Scottish Parliament will be required. A review of the voting system for the Scottish Parliament elections could form part of a wider review of issues relating to the Scottish Parliament.
Mr Davidson
May I just clarify a point? The Minister said that the proposal put forward by my hon. Friend the Member for Central Ayrshire (Mr Donohoe) is not clear on the question of what would happen in respect of people having two votes. May I refer him to the wording? New clause 1 states:
“each elector to cast one or two votes of equal value, with no more than one vote to be given to any one candidate, in constituencies returning two members”.
It continues:
“the two candidates with the most valid votes to be elected in such constituencies.”
So I understand that the reference to people having “two votes” applies only to the constituencies that are not the three identified.
David Mundell
I welcome the hon. Gentleman’s analysis, but I do not think it stands up to legal scrutiny in that regard.
Mr Donohoe
Can the Minister just tell me why? I have read that provision at some length and I am clearly of the opinion that it covers the points that he says it does not.
David Mundell
The interpretation of that provision is that people in the Western Isles, Orkney or Shetland could still have two votes.
David Mundell
That is a clear possible interpretation of that provision. The hon. Gentleman is better advised making his case not on the technicalities of the wording, but on his strong beliefs about this issue.
On new clause 2, I have made clear the Government’s view that it is a matter for the Scottish Parliament to regulate the conduct of its Members and the relationships between list and constituency Members. On that basis, we cannot accept the new clause.
Mr Donohoe
On the basis of what has just been said, I am almost of a mind to press the new clause to a vote.
Let me make some points to sum up. I would argue that this has been one of the better debates on the Bill that we have had across the piece. It has at times been humorous and it has been good-humoured, which is unusual in some respects. It has also at times been useful and interesting to be able to draw out some of my long-held points of view. I am conscious that in these circumstances—given that this debate is just the beginning—we should withdraw our proposal, and so I beg to ask leave to withdraw the motion.
Clause, by leave, withdrawn.
New Clause 3
Maritime policy
‘(1) The Scotland Act 1998 is amended as follows.
(2) In Schedule 5, section E3, leave out—
(a) the Coastguard Act 1925”.
(3) After section 90 insert section 90A as follows—
“Maritime and Coastguard Agency (Scotland)
90A (1) The Maritime and Coastguard Agency is to be treated as a Cross-Border Public Authority for the purposes of sections 88 to 90.
(2) The funding, operation and planning authority of Maritime and Coastguard Agency facilities in Scotland shall reside with the Scottish Government and the appropriate Scottish Minister.
(3) These parts of the Maritime and Coastguard Agency which are the responsibility of Scottish Government shall be known as the Maritime and Coastguard Agency (Scotland).
(4) The Maritime and Coastguard Agency (Scotland) will be responsible for maintaining and upholding domestic and international laws and obligations in the Scottish Waters.
(5) For the purposes of this section, the Scottish Waters are as defined by the Scottish Adjacent Waters Boundary Order 1999.”.’.—(Mr MacNeil.)
Brought up, and read the First time.
The Second Deputy Chairman of Ways and Means (Dawn Primarolo)
With this it will be convenient to discuss the following:
New clause 4—Economic incentives for the Scottish maritime industry—
‘(1) The Scotland Act 1998 is amended as follows.
(2) In Schedule 5, section E3, the words “Financial assistance for shipping services which start or finish or both outside Scotland” are replaced with “Financial assistance for shipping services which both start and finish outside Scotland.”.’.
New clause 12—Scottish maritime boundaries—
‘(1) In section 126(2) of the 1998 Act, after “Council”, insert “and with the Consent of the Scottish Parliament”.
(2) At the end of section 126(2) insert “A boundary order shall be issued in 2012.”.’.
Mr MacNeil
Throughout our proceedings, we have heard claims from the Tories and the Liberal Democrats that this Bill is the greatest transfer of powers from Westminster to Scotland in more than 300 years. To ensure that it is truly a transfer of powers, I propose several additions that will see the Scottish Government gain more control over Scotland’s maritime future.
We seek to devolve the operation and funding of the Maritime and Coastguard Agency to Scotland, to remove restrictions in the Scotland Act 1998 that prevent the Scottish Government from providing incentives to the shipping industry in Scotland and to ensure that the Scottish Parliament agrees to any movement of the border instigated from London. I am aware that those proposals were not recommended in the Calman commission’s report, but we cannot expect Calman to have thought of everything. Anything might have come from Calman, I suppose, but, of course, it does not matter because the Government have picked and mixed the recommendations as they were made.
New clause 3 was sparked by the Government’s proposals to cut the coastguard service throughout the UK. Those proposals seek to leave three to four co-ordination centres south of the border and only one 24-hour co-ordination centre and one part-time centre in Scotland—there are currently five. The proposals were not meant to be debated in this House and were certainly not presented to the Scottish Parliament. That shows a blatant disrespect not only for the Scottish Parliament and Government but for MPs in this House who, to take my case as an example, will be affected by these decisions.
Through my proposals, we seek to alleviate the financial and administrative burden on the Department for Transport by taking the Scottish portion of the coastguard service out of its realm of responsibility. The decision on the future of the coastguard in Scotland should, rightly, take place in Scotland.
Mark Lazarowicz
Has the hon. Gentleman assessed the views of the trade unions representing those who work in the coastguard service or the seagoing community about whether they want to see the coastguard service split up in that way?
Mr MacNeil
Yes, I have asked people who work in the coastguard and, yes, they do want to see this happen.
Mark Lazarowicz
Just to be clear, I did not mean somebody in the coastguard service whom the hon. Gentleman knows. I asked whether trade unions collectively —at least at a Scottish level—support the change.
Mr MacNeil
I hope that the trade unions would act in the best interests of their members’ employment and the coastguard service throughout Scotland and try to maintain coastguard stations in Scotland. I am quite sure that if the Scottish Government—regardless of their party—were in charge of this matter, the savage cuts would not be happening.
Scotland has an estimated 60% of all the coastline in the UK, so the Scottish Parliament and Government should surely be the primary body that decides the future of the force that protects mariners and the community. We have already seen the beginning of the process with the passing of the Marine and Coastal Access Act 2009, and we must continue that through these proposals, which would ensure that the Maritime and Coastguard Agency in Scotland enforced Scots law on environmental matters. We seek to have the MCA fall in line with the local operation of the police, health service and other devolved agencies.
According to the Maritime and Coastguard Agency, the seas and coastlines are getting more congested, ships are getting larger and the weather is getting worse. With that information in mind, it surely makes sense to implement a division of labour and allow the MCA in England to focus on Southampton and London and leave Scottish waters to Scotland.
Our new clause removes the restrictions in the Scotland Act that prevent the Scots Government from running the coastguard. Once we place it in the category of a cross-border public authority, we will remove nearly £5 million of coastguard co-ordination centre operating costs from the Department for Transport’s budgets alone. That would give us the opportunity in Scotland to secure a proper coastguard service for Scotland. In the past year, we have heard that contracts to provide life-saving helicopters have been bungled completely. Our tugboat services have been cut to save money, in line, we are told, with these austere times, but that unfortunately exposes Scotland to severe gaps in coastline coverage. On a side note, we want to know what will happen to our tugs when these front-line services come up for contract renewal in September.
If Members look closely at the proposals, they will see that we are not attempting to change international agreements or safety legislation. We are simply seeking to ensure that decisions regarding the Scottish coastline are taken in the best interests of Scotland. In short, they move power from Westminster to the most democratic institution representing Scotland—the Scots Parliament.
Mr Russell Brown (Dumfries and Galloway) (Lab)
If the hon. Gentleman’s new clause were successful, would he envisage more than one full-time station in Aberdeen, or would one suffice in his view?
Mr MacNeil
I would envisage far more than one full-time station in Aberdeen.
This will not be the first time that the House of Commons has heard of the concept of change and of control moving away from the MCA. In 1989, the Isle of Man formed its own coastguard after the UK unilaterally decided to shut down the coastguard co-ordination centre in Ramsey. The Manx Government—perhaps this shows what happens when there is more local control—rightly decided that they should no longer depend on the United Kingdom to protect their coastline and therefore created their own coastguard. That coastguard has five stations open around the Isle of Man and has retained close ties with the Liverpool maritime rescue co-ordination centre, which I would like to remain open.
The Government of the Isle of Man took the right decisions at the right time to ensure that their coast was secure. Surely, it cannot be the will of the Committee to deny Scotland that same inalienable right. This is not the first time that a potential coastguard authority move has been presented. In its illustrious 189-year history, the coastguard has been under the Board of Trade between 1923 and 1939, the Ministry of Shipping from 1939 to 1940, the Admiralty from 1940 to 1945, the Ministry of War and then the Ministry of Transport from 1945 to 1964, the Department of Trade from 1964 to 1983, the Department of Transport from 1983 to 1997 and finally, the Department for Transport from 2002 to this date. All we seek to do is move that one step further and ensure that the Scots coastguard reports directly to Scotland.
Mr Tom Harris
I agree with the substance of what the hon. Gentleman is saying about the effects of the cuts to the coastguard system, but would he be proposing this change if the cuts to the maritime coastguard service were not being made at the Department for Transport? He is in danger, I think, of opening himself up to accusations of opportunism if this move is a response to budget cuts rather than a point of principle. I am not aware that this point of principle has been raised by the SNP in the past.
Mr MacNeil
I am glad that the hon. Gentleman agrees with me on the substantial thrust of my argument and I hope to see him with me in the Lobby as a result. Would I have done this if such a proposal had not been made at the moment? Perhaps not, but given the safety concerns, this matter is pressing. Given that the process started without any risk assessment from the MCA, despite the relevant Minister telling me at the Dispatch Box that there had been such an assessment, I think that politics has to meet the pressing concerns among Royal National Lifeboat Institution crews, people who used to be involved in shipping, working coastguards and a variety of people across the community—certainly in the highlands and islands and, I imagine, further down to the Clyde and over to the Forth and, indeed, Shetland.
New clause 4 would redress a bizarre part of the Scotland Act that prevents the Scottish Government from creating incentives for the maritime industry in Scotland. Currently, the Government of Scotland have the ability to incentivise travel for maritime journeys that both start and end in Scotland, which has meant that a successful pilot project on the west coast for the road equivalent tariff has been brought to the Outer Hebrides and to Coll and Tiree. We hope that policy will continue, as it has done quite a lot to help the economies of those areas in a time of severe economic downturn.
Maritime policy is vital to Scotland as we are responsible for 70% of all the fish landed in the UK. Aberdeen is home to the North sea oil industry and lands nearly 4.5 million tonnes of cargo annually from approximately 8,000 ships. Clyde port lands 7.5 million tonnes of cargo and Stornoway port in my constituency has 200,000 people travelling through it each year. The ability to control the maritime economy is surely vital to what is a maritime nation. It is vital to secure future growth in the Scottish economy.
The figures that I have presented for the Aberdeen and Clyde ports are small in comparison with Southampton, which lands 75 million tonnes of cargo annually. Currently, the shipping industry coalesces around the south of England leaving little else for the rest of the UK. It is peculiar that most of Scotland’s goods are transported to the south of England and then driven into Scotland. With ever-increasing fuel costs and more congested motorways, surely that is not a good idea. The cost of moving goods to Scotland will invariably increase as the costs of transportation increase, and we propose that costs could be saved if there were an incentive for ships to land their goods in Scotland. The professor of maritime research at Edinburgh Napier university, Alf Baird, put it succinctly when he said that
“the present reality is that firms located in Scotland are considerably worse off in international transport cost terms compared with firms located close to hub ports in the south east of England…firms in the central belt of Scotland are between 15-23% worse off, while firms in the highlands are 22-33% worse off, and firms located on remote islands between 37-63% worse off…From a purely Scottish perspective this therefore raises the question—is the current method of serving Scottish industry’s global import and export needs through remote UK ports sustainable in the long run? Or, in other words, will rising domestic UK transport costs (rail as well as road) make Scottish industry even less competitive in global markets than it is today, leading to further job losses”—
that is the important point, as we want to keep people in employment—
“in manufacturing and reduced competitiveness?”
Fiona O'Donnell
I am sure that the hon. Gentleman is glad to pause for breath. He has said that he is proposing these new clauses because Calman missed them out, but did he put forward any submissions to the Holyrood Bill Committee or the Select Committee on Scottish Affairs about these matters?
Mr MacNeil
The most appropriate place for the measures is in the Bill, which is why I have chosen to bring them forward now.
Professor Baird has asked rather straightforward questions that should be addressed by a specific maritime policy with regard to seaport provision in Scotland and the impacts of such a policy for trade and economic development. Surely, Scotland should be able to entice shippers to send goods to our ports. As the home of the large northern ports of the UK, we are well placed to provide efficient ports for shipping goods throughout Scotland and, perhaps, the rest of the UK. We should at least be given the opportunity to try. However, there are restrictions in place and all we can do is hope that companies land their goods there. This issue is at the crux of our main argument. Scotland needs to have the economic levers to promote growth, which would also help with the aggregate growth of the British Isles. Without the ability to entice business to Scotland, we will lose a real chance to grow sectors of our economy that could provide a counterweight to other portions of the Scottish economy. Our new clauses would ensure that the Scottish Government have the ability to promote the Scottish shipping industry and Scottish ports.
Michael Connarty
Before the hon. Gentleman disappears off the map of the maritime borders of the UK, may we return to the subject in hand? As someone who represents the busiest port in Scotland, Grangemouth, it concerns me that the ships that come in and out of it travel more in non-Scottish waters than in Scottish waters to reach that port. Dividing the forces that need to be gathered to fight the terrible cuts in the entire UK coastguard service that are coming from the Government and hiving off Scotland would not greatly advantage the people who come in and out of the port that I represent. Is it not better that we stand together and fight the cuts than try to divide into two different land masses and two different Governments?
Mr MacNeil
I am sure that the hon. Gentleman knows that there is more than one way to skin a cat. I am also sure that he would like to see a busier port in Grangemouth and a Government able to incentivise greater activity in Grangemouth. I therefore expect him to support my new clauses.
These measures will mean that the Scottish Parliament and Government can get on with the job of making Scotland better and allow the rest of the UK to focus on what it considers to be important. This is a litmus test that will show Scotland which of its MPs stand for Scotland and which of them focus on party advantage. I intend to press new clauses 3 and 12 to Divisions.
Mr Frank Doran (Aberdeen North) (Lab)
I shall speak mainly on new clause 3. I am rather bemused by the contribution that we have just heard on new clause 12. The hon. Member for Na h-Eileanan an Iar (Mr MacNeil) has presented a dangerous argument, and I am not sure whether I totally understand it.
I have always understood that the current boundary was agreed by international negotiation in 1707. The Scottish border used to go down as far as Newcastle and in some respects almost as far as Bolton, I think, but things have changed. I know that the SNP has a hang-up about the oil industry and the fact that what it sees as its rightful share has been stolen from it. However, there are much more serious issues to be discussed today.
The hon. Gentleman appropriately raised the issue of the coastguard. I know that his coastguard station in Stornoway is one of the stations under threat. It is right for him to fight for it, but it is not right to extend the argument to where nationalists tend to end up—that the only way to solve a problem is to move it to Scotland. There is a serious issue around the reorganisation of the coastguard. He knows as well as I do that in Scotland there will be just two stations—the maritime operating centre, which it is proposed will be in Aberdeen in my constituency, and either Shetland or Stornoway.
My understanding is that Shetland did not figure in the original Government proposal, but a certain amount of influence within Government has seen Shetland on the list. I hope the hon. Gentleman wins his battle to save the Stornoway station. That battle is entirely appropriate. Apart from anything else, the fact that in the Western Isles there is a preponderance of Gaelic speaking and Gaelic place names means that, if there is any risk in that area, it is essential that the geography is properly understood. It is important to make that point.
Mr MacNeil
Given what the hon. Gentleman has said, surely he understands my argument that it would be better for control to lie in the Scottish Parliament and with the Scottish Government. Since 1999, the Scottish Government have been either SNP or Labour-led. My new clause would remove the Maritime and Coastguard Agency from the clutches of the Conservatives, whose tendency seems to be to cut. Would the hon. Gentleman prefer to leave the agency with the Conservatives?
Mr Doran
My argument is that a problem is not solved just by moving it to Scotland. There are fundamental problems with the coastguard—for example, most of the equipment that it uses is 40 years out of date. There is new technology available which is necessary for proper safety on our seas. The money needs to be invested. Given the present financial situation, one of the few ways that money can be invested, sadly, involves the closure of a number of coastguards. I have been told by workers at my own coastguard that with the new technology, Aberdeen could cover the whole of Scotland, but the point that I made earlier about the Western Isles is recognised. The issue will not be resolved simply by asking for it to be devolved to the Scottish Parliament.
I am by no means in favour of everything proposed in the consultation paper published by the Government, but what is needed is a properly co-ordinated national system, which we do not have at present. We have groups or pairs of coastguard stations which can communicate with one another, but in the event of a major disaster or a major incident, it is difficult to see how we could get the full benefit of a national system and the investment that we need to make by separating the Scottish service from the rest of the UK and allowing that to operate on its own.
I was heavily involved in the aftermath of the Piper Alpha disaster, when the coastguard played a pivotal role—I do not know which other stations were involved. The service then was very similar to what it is now, and there was not the capacity to involve the whole of the coastguard operation throughout the UK. Given what we have seen in other countries in recent years, it is possible that that facility may be necessary in the future. As I have said, the way to resolve a major infrastructure problem is not to cut it off and devolve it to Scotland, which is a blinded and fundamentalist view of how we should function.
We need a co-ordinated system throughout the UK. One of the key weaknesses of breaking up the system is what the Scottish Government would or could do with it. Like many people, I am suspicious about the fact that the SNP Government in Edinburgh have made no attempt to give us a proper Budget for the next three years, as we have seen the current Government and the previous Labour Government produce for the UK. Of course, there is an election on the way, so that will be the main consideration.
If the coastguard system is to be upgraded to modern standards, where will the necessary money come from? If the hon. Gentleman was successful with his new clause, there would clearly have to be some transfer of money from the UK to pay for the existing system, but not for upgrading it. The system that I hope will be based in my constituency at Aberdeen, once the consultation exercise is over and the investment has been made, will serve not just Scottish waters, but almost half the UK—it will be capable of serving the whole UK. Would that be on offer in a system run under the narrow nationalist view that the hon. Gentleman is taking? I do not know.
I need to know, and the Committee needs to know, where the money will come from to upgrade and modernise the system. It is not clear that that money exists in the Scottish Budget. If the SNP Government cannot afford to build any new schools and are not able to fund local services properly, how will they modernise the coastguard system, which is essential for the safety of our maritime fleet, our sailors and our fishing industry? The hon. Gentleman is well aware of the dangers inherent in that industry. There are more industrial accidents and deaths in the fishing industry than in virtually all the rest of industry in Britain put together. The most dangerous industry in Britain depends on the coastguard, and many operators in the fishing industry are based in his constituency.
If the new clause is part of a campaign to save the hon. Gentleman’s own coastguard station, fine. I can accept it on those terms, but if it is a serious attempt to change the system, it must be rejected.
David Mundell
This is a debate on an important issue, and in many respects I share the sentiments expressed by the hon. Member for Aberdeen North (Mr Doran). If the hon. Member for Na h-Eileanan an Iar (Mr MacNeil) is raising the issue to ensure that it is debated and his concerns are heard, then I accept his right to do so. However, if he is seriously suggesting that the coastguard service should be devolved, then obviously the Government cannot accept his proposal. The point to be made is that this matter was not brought before the Calman commission; nor was it brought before the Scottish Parliament’s Bill Committee or the Select Committee on Scottish Affairs as something that he had considered, along with the other changes that he proposed. Indeed, I am not even aware of the matter being raised as part of the so-called national conversation—something that you will have heard about in these exchanges, Ms Primarolo—which was promoted by the SNP Government in Edinburgh with the primary purpose, it would appear, of furthering the cause of independence at public expense.
Pete Wishart
The Minister keeps going on about things not being raised by the Calman commission, but nor was Antarctica or appeals to the Supreme Court. The Minister cannot have it both ways. The Government are introducing some stuff that was not in Calman, so surely they can consider other stuff that was similarly not in Calman.
David Mundell
As the hon. Gentleman is aware, the issue of Antarctica was fully considered by the Scottish Parliament’s Bill Committee and the Scottish Affairs Committee. It was not simply plucked out of the air and dealt with in an amendment in this place.
I understand the SNP’s dogmatic opposition to the Scottish Adjacent Waters Boundaries Order 1999 and its view that if Scotland had more ocean under its control, that ocean would benefit from SNP policies, but I am afraid that it is not a view I subscribe to. As the SNP knows, the Scottish Adjacent Waters Boundaries Order has two effects. First, it determines the boundary of waters that are to be treated as internal waters or the territorial sea of the UK adjacent to Scotland. That is relevant to the definition of “Scotland” in section 126(1) of the 1998 Act, which is used for the purpose of exercising devolved functions and the extent of the Scottish Parliament’s legislative competence. Similar provision is made in legislation relating to Northern Ireland and Wales for the purposes of their devolution settlements.
Secondly, the order determines the boundary of those waters to be treated as sea within British fishery limits adjacent to Scotland. That is relevant to the definition of “the Scottish zone”—in section 126(1) of the 1998 Act—in which the Scottish Parliament has legislative competence to regulate sea fisheries in accordance with the EU’s common fisheries policy and where fishermen are subject to Scots law. Scottish Ministers also have various Executive functions that are exercisable in the Scottish zone in relation to matters such as licensing and planning.
Crucially, the order defines boundaries off both the west and east coasts using the median line mythology recommended by the UN convention on the law of the sea. It is always interesting when we find the SNP in disagreement with the UN because it does not suit its purposes. This is the standard international mythology—methodology for defining water boundaries. It is illogical to use it off the west coast but deploy a boundary based on historical practice off the east coast. The Government have no plans to redefine the nautical boundaries between Scotland, England and Northern Ireland. We cannot accept that a boundary order should be issued in 2012 when no reason has been given for the need to do so other than SNP dogma. Although we recognise the strength of feeling on the coastguard, which is an important topic of debate, I urge the hon. Gentleman not to press his new clause.
Mr MacNeil
I will be brief in the hope that we will get to the vote. I am perplexed as to why the hon. Member for Aberdeen North (Mr Doran) wants to leave the Tories in charge of Scotland’s coastguard.
Mr MacNeil
The hon. Gentleman says temporarily, but in my lifetime I have seen an awfully lot of time that he might call temporary—the 18 years from 1979 to 1997. We then had Labour saying that it could do this, that and the rest of it and that we should vote Labour to stop the Tories, and that did not work once.
The hon. Member for Aberdeen North said that the new clause would not resolve the issue, but surely it would at the very least lessen the problem by moving responsibility for the coastguard to Scotland. He said that he wants a properly co-ordinated national system. That is what I want, but I fear that we will not get it because of the cuts. I recognise and respect his input and involvement in Piper Alpha. He probably misses the point that the Isle of Man has its own coastguard and seems to co-ordinate well with Liverpool, and presumably with the Republic of Ireland as well. I am disappointed that he descended into making slurs; he could have done better. The new clause is about saving coastguard stations in Scotland and keeping a coastguard in Scotland.
I of course welcome the Minister’s encouragement on ports, but he should be aware that I am trying to keep a level of coastguard service in Scotland. Regardless of the party in power in Scotland, I am quite sure that such savage cuts should not be made to our marine insurance policy, the coastguard stations. In short, the Minister sees London as the only way, and that there can be no other way such as on the Isle of Man.
Mr MacNeil
No, I will make progress.
I see that the Minister was happy that the sea area was taken from Scotland in 1999, and he revealingly made a Freudian slip by saying “mythology”. Why was that change made in 1999? I fear that he has given up his birthright for a mess of pottage.
I shall seek to divide the Committee on new clause 3 and—I hope—on new clause 12.
Question put, That the clause be read a Second time.
Thomas Docherty
I beg to move, That the clause be read a Second time.
I am obviously delighted to see that so many Members on both sides of the House take such a passionate and keen interest in Scotland’s railway services. We have had a great deal of support for the measure from the trade unions in Scotland. This is a simple, technical new clause. Most people think that the Scottish Parliament already has the ability to decide what the model of the franchise will be, and I am keen that the situation should be resolved—[Interruption.]
The Second Deputy Chairman of Ways and Means (Dawn Primarolo)
Order. We are debating a new clause to the Bill, and hon. Members should listen to the speeches. If they want to have private conversations, perhaps they could go outside. Mr Docherty is a bit squashed on the Bench there, but I am sure that he will stand in the right place while he is speaking to his new clause.
Thomas Docherty
Thank you, Ms Primarolo.
Most people think that the Scottish Parliament already has the power to decide on the model for the franchise. After all, it has to fund the ScotRail franchise, through its Ministers, and it is responsible for the letting of the franchise. It is also responsible for funding the building of new railways in Scotland, and it is worth noting that a number of new railway lines opened in Scotland between 1999 and 2007 thanks to the Labour-led Scottish Executive. The Airdrie to Bathgate line and the Larkhall to Milngavie line are two obvious examples. It is disappointing that the SNP Government saw fit to cancel the Glasgow airport rail link; that is a blot on their track record, if the Committee will pardon my rather poor pun.
The new clause would not change the health and safety rules for the railways. It is absolutely right that we have a standard—[Interruption.]
The Second Deputy Chairman
Order. I am really sorry to interrupt the hon. Gentleman again, but I can barely hear what he is saying. There are too many private conversations going on in the Chamber. Out of respect to him, will those who do not wish to listen to his speech on the new clause leave the Chamber quietly now?
Thomas Docherty
Thank you, Ms Primarolo. I see that the Chamber is suddenly becoming a bit emptier. Perhaps it is worth pointing out that the Deputy Prime Minister is hosting a drinks reception tonight for Government Back Benchers. I imagine that hon. Members are off to make sure he does not drink all the wine himself, although after the Barnsley result he probably needs to do so.
I shall return to the substantive issue of the railways in Scotland. As I was saying before I was so gently interrupted, it is obviously right that we should retain the single health and safety policy throughout Great Britain. I say “Great Britain” because, as hon. Members will be aware, the railways in Northern Ireland are part of the single railway system of the island of Ireland. My proposal refers only to the railway network in Great Britain.
It is bizarre that, following the Scotland Act 1998 and the Railways Act 2005, we have successfully given greater powers to Scottish Ministers to do everything except determine the model of the franchise. I am not going to argue that a switch to a not-for-dividend model would necessarily be in the best interests of passengers in Scotland. As a member of the Transport Salaried Staffs Association, I have worked for Network Rail. The problems that Network Rail has had in the past are well documented, and there is an ongoing issue involving the cases of sexual harassment and bullying by Peter Bennett, the head of human resources, of many of his employees. That has resulted in about £300,000 of damages and compensation being paid to employees. This is not an ideological debate; it is about who is best placed to make the decisions.
I shall give a couple of examples of how the present system is not working. We have only to look at the constituency of the Under-Secretary of State for Scotland. I was lucky enough to live there, in the village of Moffat, for a number of years, and the Minister will recall that I put myself forward as a Labour candidate in a local council by-election. It was a secret ballot, so I am not quite sure how he voted, but I recall his featuring on one of my rival candidate’s leaflets, promising that if the Conservatives won the by-election—which, surprisingly, they did—he would ensure the reopening of the Beattock railway line. My hon. Friend the Member for Glasgow South (Mr Harris) will know from his time in the rail industry and as a Transport Minister that that line sits on what is now the west coast main line.
The Minister was also a great champion of the Eastriggs railway station, which is ably represented by my old colleague, Councillor Sean Marshall. The Minister’s constituency also contains the village of Thornhill, which is in the Galloway area of the constituency. In all those places, he was a huge champion of the reopening of railway stations, yet after six years as a Member of Parliament and 10 months as a Minister in the Scotland Office, none of those railway stations has reopened. That could not possibly be because he was making promises that he could not deliver, so the fault must be with the franchise model. We need no better reason for giving Scottish Ministers the power to shape their own model.
Mr Tom Harris
I am genuinely unclear about the nature of my hon. Friend’s grievance with the current model. Is he saying that Scottish Ministers and Transport Scotland do not have the legislative capability to reopen disused stations?
Thomas Docherty
The issue at the moment is that Scottish Ministers must let the franchise according to a privatised railway model. As my hon. Friend knows, the Railways Act 2005 specifically bans a public body from acting as the franchise operator. The only exception to that is if that body is the operator of last resort, as is now the case with the east coast main line. The new clause would give Scottish Ministers the right not only to fund the railway, to let the franchise and to monitor its performance—all of which they have to do anyway—but to determine the shape of the model involved. This might well result in a privatised model like the one that we now have on the ScotRail franchise, or perhaps in a co-operative model. The Ministers might ask Transport Scotland to run the franchise, or set up a new company called Scottish Passenger Transport to do so.
The new clause provides a logical conclusion to the direction of travel—again, please pardon my poor pun—of the reconfiguration of the railways in Scotland. The reason that the proposal was not considered by the Calman commission is that it involves such a small technical change. Most Members of Parliament and MSPs were simply not aware that Scottish Ministers did not have this ability.
I look forward to hearing the Minister’s response to these points. It is possible, if his civil servants have not done a particularly good job of advising him, that he might claim that the measure would somehow bring the whole of Great Britain’s rail network crashing down. Obviously, that would be an absurd argument. The Department for Transport is already running the east coast main line as the operator of last resort, placing the line back in the public domain. I am talking about a service that is wholly contained within Scotland, and the measure would have no impact on any other service. It would have no impact on the CrossCountry service or on the east coast main line—or, indeed, on the west coast services. The only services that leave Scotland are the one that runs from the Minister’s constituency to Carlisle, on the Glasgow to Carlisle line, and the Caledonian sleeper, which runs between London and Fort William, Inverness, Edinburgh and Glasgow. That service would stay in the franchise. As I have said, this is a very technical new clause. It is supported by all the trade unions and by the Scottish Government, who see it as a logical way forward.
Iain Stewart (Milton Keynes South) (Con)
I am following the hon. Gentleman’s argument carefully. Does his new clause relate specifically to franchise matters and the operating side of the railways, or is he also seeking the devolution of some of the functions held by Network Rail?
Thomas Docherty
I am grateful for the hon. Gentleman’s question, which lets me clarify that this is purely about the franchise because the functions of Network Rail are already devolved to the Scottish Parliament. That is part of the absurdity of the situation. Scottish Ministers have responsibility for everything except, rightly, health and safety, because that needs to be regulated in a different way, and the franchise model itself. The funding, letting and monitoring of the franchise are carried out by the Scottish Parliament, but it does not set its own model. I look forward to the Minister’s well-chosen words of response to my case.
Mr Weir
Much to my surprise, I support what the hon. Member for Dunfermline and West Fife (Thomas Docherty) has said. He made a good case, as it would be sensible to devolve this function to Scotland, although he ruined it a bit by making a totally unnecessary attack on the Scottish Government, who have supported the railway industry throughout Scotland and put a great deal of money into upgrading it and opening new lines and stations.
Mr Frank Roy (Motherwell and Wishaw) (Lab)
Will the hon. Gentleman give way?
Mr Weir
No, thank you.
The hon. Member for Dunfermline and West Fife talked about the Glasgow airport rail link. I would be interested to see whether that proposal appears in Labour’s manifesto with full details of how it is to be funded, and what Labour is going to cut in order to do so, given the cuts that are coming in the Scottish budget because of Labour’s economic mismanagement and the incompetence of the current UK Government.
Mr Weir
No, thank you.
Scotland has a good record on rail and will continue to invest in rail and build up the rail system. This proposal would give the Scottish Government the opportunity to get a different franchise arrangement should they wish to do so. It would be up to them to decide on the franchise, but it would provide flexibility. We support the new clause, notwithstanding the totally unnecessary attacks on the Scottish Government by the hon. Member for Dunfermline and West Fife.
Tom Greatrex (Rutherglen and Hamilton West) (Lab/Co-op)
I do not intend to detain the Committee because there are other new clauses we wish to debate.
The new clause deals with an issue that was probably neglected in the transfer of powers to the Scottish Parliament in relation to rail, and it is appropriate and sensible that we use the opportunity of this Bill to resolve that. On that basis, we intend to support it and assume, given that it is a sensible proposal on a technical issue, that the Government will not have too much of a problem with it.
David Mundell
I was disappointed that the hon. Member for Dunfermline and West Fife (Thomas Docherty) missed out Symington station as one of those that I continue to campaign to be reopened in my constituency, as it has brought vital rail services to that part of Scotland.
I was interested in the hon. Gentleman’s analysis of the requirements of the rail services in Scotland. His constituency counterpart, Helen Eadie, was the only Labour MSP to vote against the legislative consent motion for the Bill in the Scottish Parliament. Of course, Mrs Eadie is well known for her radical views on the Scottish rail network, proposing as she has the demolition of the Forth rail bridge. I was pleased that he did not suggest that that would fall within the powers of the Scottish Parliament.
Thomas Docherty
It might help the Minister to know that the Forth bridge is a category A listed building, so unfortunately Mrs Eadie would not have the ability to knock it down.
David Mundell
I am grateful for that confirmation, because the newspaper article that I read described Mrs Eadie as being unrepentant despite criticism from several quarters in that regard.
I am afraid that I must disappoint both the hon. Member for Dunfermline and West Fife and the hon. Member for Rutherglen and Hamilton West (Tom Greatrex), because the Government cannot support new clause 9. It deals with rail responsibilities, as the hon. Member for Dunfermline and West Fife explained, and seeks to give the Scottish Parliament legislative competence over the provision of rail passenger services that start and finish in Scotland. That is a much longer list than the one to which he alluded, because it involves all cross-border services, including the Virgin franchise services on the west coast main line, which do not start and finish in Scotland and remain the responsibility of the Department for Transport.
Iain Stewart
Is my right hon. Friend aware that Glasgow and Edinburgh councils are running a strong campaign for the construction of a high-speed line from London to the midlands and further north, with the simultaneous building of a high-speed line from Scotland southwards? That would provide additional cross-border services, and it, too, would have to be taken into account when framing legislation such as this.
David Mundell
Indeed. As my hon. Friend will know, the coalition Government are committed to high-speed rail services throughout the United Kingdom. On Thursday, there will be an event in Glasgow, attended by a Transport Minister, about a consultation on the ongoing developments in high-speed rail. The first part of the high-speed rail service from London to Birmingham is vital for its further development into Scotland.
Mr Weir
I am listening closely to the Minister, but I am slightly confused. He is talking about the development of high-speed rail, which will be very good if it comes to Scotland—we will see whether the Government ever get it there—but that service does not begin and end in Scotland, and neither do the Virgin or east coast services. I do not understand his point. The new clause refers to services that begin and end in Scotland—basically, the ScotRail franchise as it operates at the moment.
David Mundell
My point, which I am sure that the hon. Gentleman does not recognise for dogmatic reasons, is that there are important rail services in Scotland that cross the border, and that those services remain important.
Mark Lazarowicz
Given that that is the current situation, why on earth are the Government opposing a new clause that refers to services that “start and finish”, not “start or finish”, in Scotland?
David Mundell
If the hon. Gentleman had listened to the hon. Member for Dunfermline and West Fife, he would have heard him give a very narrow definition of services which start and finish in Scotland, without giving sufficient recognition to the fact that there are significant services that cross the border.
Mr Tom Harris
I listened closely to my hon. Friend’s speech, and he was very explicit in saying that the new clause refers only to the ScotRail franchise. That includes one cross-border service, the Caledonian sleeper, but this would have no effect whatever on other franchise services that cross the border—Virgin, East Coast and TransPennine Express. They would be completely untouched; nothing would change in their operational or financial arrangements. The only thing that would change is the ScotRail franchise. Can the Minister explain why that is beyond the wit of the Government?
David Mundell
If the hon. Gentleman had been listening, he would realise that I have said that Scotland benefits from a mix of services within the ScotRail franchise, and that cross-border services are vital to Scotland. I would have hoped that he would support the view of my hon. Friend the Member for Milton Keynes South (Iain Stewart) that high-speed rail is important to Scotland. However, none of those things is why the Government do not support the new clause.
Iain Stewart
The Minister is being very generous. I am happy to stand corrected, but I believe that there is a cross-border ScotRail service. It probably goes through Dumfries in his constituency to Carlisle and on to Newcastle. How will that service be included in the new clause?
David Mundell
There are indeed services that travel from Glasgow to Dumfries and on to Newcastle.
However, the Government’s objection to the new clause is that we are committed to maintaining a GB-wide national rail network that is publicly specified, funded in the public interest and provided by the private sector. The new clause would interfere with that national network. If the intention of the hon. Member for Dunfermline and West Fife is to allow for a not-for-dividend operator of the ScotRail network, that is possible within the current framework.
Mr Tom Harris
I am grateful to the Minister for giving way once more. I agree with him that the GB-wide network should be publicly specified and commercially provided by the private sector. However, surely it goes against the spirit of devolution and of the Scotland Bill to deny Scottish Ministers the right to take a different view with regard to one self-contained franchise in Scotland. Surely devolution is about allowing Scottish Ministers to make mistakes, if that is what they wish to do.
David Mundell
The devolution settlement is indeed about allowing the Scottish Government to take decisions in respect of the areas for which they are responsible, as determined by the Scotland Act 1998 and the Scotland Bill. This discussion is about whether the issue in question should be devolved to the Scottish Government. The Government do not agree with that proposal because we believe that it would open the opportunity to fundamentally alter the national framework by allowing a renationalisation of the railway in Scotland.
David Mundell
The hon. Gentleman knows better than most that the Government were required to take over the east coast main line as a measure of last resort. Within the framework of the rail industry, there have to be measures of last resort. It is not a measure that the Government wish to promote. As I have said, we wish to promote a national rail network that is publicly specified, funded in the public interest and provided by the private sector. As I have also said, if it is the intention that a not-for-dividend company should operate, there is nothing to stop that in the present arrangements.
Thomas Docherty
I would not wish to suggest that the Minister is misleading the House—he has obviously been misinformed by the civil servants in the Box—but the Railways Act 1993 is explicit that a public sector operator cannot run the railways. I would be happy to go out to the Lobby and get the section of the Act that says that.
David Mundell
The hon. Gentleman is seeking to give a different definition. I am specifying a not-for-dividend organisation. If he wants to go beyond that and into the realms of opening up the powers for the Scottish Government to renationalise the railways in Scotland, he should promote that point in a different debate, and not by tabling a new clause to this Bill. If he genuinely believes that the railways in Scotland should be renationalised, he should make that argument in the appropriate place.
The hon. Members for Dunfermline and West Fife and for Rutherglen and Hamilton West said that this was a minor matter that was being brought forward at this stage because it had simply been overlooked. However, I believe that it would have benefited from the thorough scrutiny of the Scotland Bill Committee in the Scottish Parliament and from discussion in the Scottish Affairs Committee.
John Thurso
I have no doubt that the Minister is right to resist the amendment, because I am sure that it is technically deficient in some way, but—[Laughter.] I took part in the entire Committee stage of the Railways Act 2005, and the intention was to devolve everything that could be devolved to the Scottish Government in relation to the railways. Is there no room for compromise to allow for what is a reasonably sensible suggestion without breaking the principle that the Minister is evoking?
David Mundell
The hon. Gentleman, as always, offers wise words. I thought that he was going to refer to the debate in this House on 31 March 1998, although he was not then a Member, in which rail powers were debated in the context of the original Scotland Bill. The hon. Member for Central Ayrshire was prominent in that debate, as he was in our earlier discussion on voting systems.
Mark Lazarowicz
Again, I honestly do not understand the Minister’s position. The new clause refers to the provision of rail services, but it does not provide for the devolution of the rail infrastructure. The tracks and the rest of it could not be sold off. I suggest that he remembers that he is in a coalition and rethinks this issue before he is deserted by some of his colleagues to his right.
David Mundell
I have set out why the Government cannot accept the new clause. The Government believe that the devolved powers, which are significant, are best exercised within a coherent GB structure, as provided under the Railways Acts of 1993 and 2005. We believe that it is essential that the overall regime for the provision of rail passenger services and their regulation remains a reserved matter. It would not be sensible to run the railway in such a way that the Scottish Parliament could overturn the framework that governs the operation of passenger services on a GB basis. Our policy is to maintain a unified national rail network that is subject to appropriate oversight by Scottish Ministers. I believe that the current system achieves that. I therefore ask the hon. Member for Dunfermline and West Fife to withdraw the new clause.
Thomas Docherty
This should have been a relatively short and reasonable debate. As my hon. Friend the Member for Rutherglen and Hamilton West (Tom Greatrex) said, on the face of it there should have been no opposition to the new clause. I am therefore pretty surprised by the rather weak arguments that the civil servants have foisted upon the Minister, who I think knows better.
To address the point made by the hon. Member for Milton Keynes South (Iain Stewart), it would be absurd if a railway line that ran from Glasgow down through Ayrshire, Dumfries and Galloway did not have its terminus in Carlisle. There is a variation in the operating rules that allows ScotRail to run that service to Carlisle. That service is part of the ScotRail franchise and has no impact on the other services that run through and connect at Carlisle.
Iain Stewart
Perhaps I can clarify my point. I understood that the hon. Gentleman’s argument was about devolving the whole of the ScotRail franchise, and I was simply trying to clarify what would happen to the one route that is within that franchise but is a cross-border service.
Thomas Docherty
Obviously that would be part of the ScotRail franchise and would carry on in that way.
The Minister’s argument is clearly ideological. He assumes that if the Scottish Parliament were given responsibility for the matter, it would automatically nationalise the railway. That is not the purpose of the new clause. It is about giving Scottish Ministers the power and authority to make that decision. His arguments are weak.
Mr Reid
I am genuinely confused by what the hon. Gentleman said in response to my hon. Friend the Member for Milton Keynes South (Iain Stewart). The new clause is clear that only passenger services that start and finish in Scotland should be devolved, but the hon. Gentleman says he wants to devolve the ScotRail franchise. However, as we have heard, that franchise sometimes crosses the border.
Thomas Docherty
I am grateful to the hon. Gentleman for joining us at this late stage. I must clarify for him that the legal terminology in the Railways Act 1993 defines the franchise area as those services that begin and end wholly within Scotland. However, the franchise also covers the tiny stretch to Carlisle. He might wish to take up that legal point with the Library, but it does not affect the new clause.
I am conscious that we are keeping Conservative Members back from their drinks reception with the Deputy Prime Minister. I regret to say that I found the Minister’s arguments rather weak and will therefore press the new clause to a Division.
Question put, That the clause be read a Second time.
Mr MacNeil
I beg to move, That the clause be read a Second time.
In discussing new clause 10, which stands in my name and the names of my hon. Friends, I wish to present just a few simple questions to the Committee.
What accountability do Crown Estate commissioners have to Scotland? The head office of the commissioners is here in London, the revenues for the Crown Estate are paid here in London, and the commissioners are not obligated to report to the Scots Parliament, which is the most democratic forum representing Scotland—instead, they sparingly report to this Parliament. The Crown Estate commissioners in Scotland operate under Scots law, because areas over which they take so much control, such as the foreshore and sea bed, are governed by Scots law. My argument is that the administration of the Crown Estate in Scotland should be constituted and controlled within Scots law and the Scottish Parliament.
Scotland accounts for 6% of the Crown Estate’s moneys. Two years ago, that was £17 million, and last year it was £13 million. People to whom I have spoken consider the way in which the Crown Estate commissioners operate in Scotland to be parasitic. Other than demanding money, the commissioners are felt not to conduct themselves with much positive impact. In fact, they are found to be quite menacing. Year after year around the nation’s coast, they leech their danegeld from harbours, ports, moorings industries and some of the most fragile parts of the Scottish economy. In Stornoway alone, they take £17,000 from the port authority, whose tie I am wearing tonight. It is a galling circumstance in an island community to lose a greater part of a person’s wage to the commissioners, when they plough no profits into the harbour or investment, unlike the port authority. The port authority is dealing with a landlord—or a landlord agent—with no obligations at all. In addition, last year, for no visible return, £2.3 million vanished from the salmon farm industry in Scotland, which must compete with the sharp and capable Norwegians, among others.
The commissioners sold portions of their urban portfolio from Edinburgh’s lucrative Princes street for an £8 million loss to fund shopping centres and warehouses in England. We have been told time and again by successive UK Governments that Scotland is not getting short-changed from the Crown Estate. The commissioners say that they are the best managers of the land, but from what I have seen and from what people have told me, with respect, I must disagree.
The Crown Estate commission is a large management organisation, the sole purpose of which, according to the Crown Estate Act 1961, is to “maintain and enhance” the value of the Crown Estate
“and the return obtained from it, but with due regard to the requirements of good management.”
How can that organisation manage its land effectively for the people of Scotland when it need not report to the Scottish Government or Parliament, or indeed to Scottish local authorities?
Comhairle nan Eilean Siar, the local council in the Outer Hebrides, recently produced a paper on renewable energy that in fact turned out in large part to be about the limitations to development and the problems that the Crown Estate commissioners pose. It states:
“The current Crown Estate lease model is outdated, unfair and discriminatory and this inequality will be compounded as the industry grows…It is critical to the sustainability of the”
Outer Hebrides
“that significant lease income from the growing marine energy industry is retained in the”
Outer Hebrides. The people of the Outer Hebrides
“view their seas as they do their land…as a resource for the local community. Where possible, lease income from marine projects should follow the onshore wind model and remain in the”
Outer Hebrides.
“The islands of Scotland should”
be permitted to
“play a more active part in management of their coastal waters and should take a corresponding benefit from the resources present in these waters.”
The opinion of the Comhairle is that the advent of devolution has had a detrimental impact on the Crown Estate, which has unfortunately moved
“further away from Scottish sea-based communities and lessened”
its
“accountability in Scotland. Crown Estate administration and revenues of Scottish territorial waters should operate as part of the Scottish Government”
in partnership with the appropriate local authority. The Comhairle states:
“Management of the local foreshore should transfer to the”
appropriate
“Local Authority…The Crown Estate lease process is rigid and inflexible, incapable of responding to fast moving developments in the marine energy sector…a more responsive process”
is required to
“accommodate speculative marine deployments outwith the terms of current or proposed lease bidding rounds.”
That is fairly damning.
I understand that the Crown Estate commissioners offer annual reports to the Houses of Parliament under a compulsory legislative duty and do so to the Scots Parliament out of courtesy. Although this Parliament can hold the Crown Estate to account via the Chancellor of the Exchequer and the Secretary of State for Scotland—in my opinion, it is not much of an account—the Scots Parliament holds no such right.
Let us look back at the genesis of all this. Robin Callander’s book, “How Scotland is Owned”, outlines the situation along these lines: although Scotland lost its independence in 1707—temporarily, I hope—it continues to be a sovereign nation and a stateless nation. In Scotland, sovereignty rests with the people, not in the persona of the monarch, as is the case in England. That is why we have had the King or Queen of Scots as opposed to the King or Queen of England. The Crown identity in Scotland is as a representative of the sovereignty of the people, hence the traditional phrase “the community of the realm”. That difference was again seen in the 1680s with the 1688 Bill of Rights in England, but the 1689 Claim of Right in Scotland.
As illustrated by the Comhairle’s statement, many Scotsmen and women of either an historical bent or, as in my case, Hebridean conditioning view the seas as a continuation of the land. It is perverse that the most democratic forum representing the sovereign Scottish people—the Scottish Parliament—does not have control over the estates of the people’s representative. In many cases, the Crown’s rights date back to the 13th and 14th centuries, and some of these are distinctively Scottish Crown rights with no legal equivalent in the rest of the UK. The Forestry Commission in Scotland used to act on similar lines to the Crown Estate, but its powers have now been devolved to allow it to function as an instrument of Scottish Government policy, which is what we need the Crown Estate to do at the level of local authorities.
The Crown Estate commission is a property management company that aims not at the public good but unfortunately at the maximum extraction of revenue, as I have seen and previously mentioned. The commission merely administers property rights and interests that comprise the Crown Estate; it does not own the estate. In many cases, it deals with Scottish public land with Crown property rights, which is certainly feudal behaviour. A report by the Crown Estate working group in 2006 stated that there is a stark contrast between
“the ways in which the public interest in the Crown’s ownership of the seabed and public foreshore could be managed to complement Scottish Executive’s policies designed to support rural, coastal and island communities and the public interest more generally.”
That group was composed of The Highland council, Highlands and Islands Enterprise, Orkney Islands council, Shetland Islands council, Comhairle nan Eilean Siar, Argyll and Bute council, Moray council and the Convention of Scottish Local Authorities.
The group concluded—this is a lengthy but worthwhile quote—that the
“administration and revenues of some of the property rights of the Crown in Scotland are already devolved to the Scottish Executive. Others which are still managed by the CEC as part of the Crown Estate in Scotland could follow, for example, through the planned UK Marine Bill. In considering the case for a review, some of the lesser property rights of the Crown in Scotland might be seen as historical anachronisms where reform will bring only modest benefits. However, reforming the management of Scotland’s seabed and public foreshore offers an opportunity to secure benefits on what might be considered an historic scale to Scotland’s coastal and island communities and the nation as a whole. The reform of these property rights of the Crown in Scotland could be as symbolic for Scotland as the Scottish Parliament’s abolition of other property rights of the Crown in Scotland with feudal reform. The potential benefits for Scotland in this case, however, would be much more tangible and substantial.”
We have a serious problem when one of the largest land managers in Scotland is not accountable to the people of Scotland. The Crown Estate commissioners have a major impact on salmon farming, shellfish farming and aquaculture, they derive income from harbours and moorings and they own the entire foreshore around Scotland, yet they have absolutely no legislative duty to speak to the Scottish Parliament. A group with that much power should be accountable to the local communities of Scotland, not the Chancellor of the Exchequer at No. 11 Downing street, which is many miles away.
Our new clause calls on the Crown Estate commissioners to do what they should be doing anyway. We are seeking that the Crown Estate revenues be devolved to Scotland and that the management of the estate come under the power of the Scots Government. We want the Crown estate to become another Scottish success story, like the NHS and the police, and we want to amend the 1961 Act with new clause 10. We hope to remove the restrictions in the Scotland Act 1998 that prevent the Scottish Government—and by extension the nation, the businesses and the communities, including the islands and coastal communities, of Scotland—from running and directly benefiting from the organisation. It is at best odd that this particular function of the Crown was not devolved immediately, given that Scotland has more than 60% of the UK’s coastline. The Government’s plan for a Crown Estate commissioner do not go far enough, because this person will be accountable to the Treasury, not Scotland—more like a colonial administrator perhaps. The Crown Estate commissioners should operate as a body under Scots law, which is best accomplished by devolving their powers to the Scots Parliament and further to local authorities.
Before the Committee commences its usual assault on the ability of Scots to govern more than Westminster wants, I want to draw attention to five Liberal Democrat MPs who supported a private Member’s Bill on the subject in 2006, including the hon. Members for Argyll and Bute (Mr Reid) and for Caithness, Sutherland and Easter Ross (John Thurso), the Chief Secretary to the Treasury and the right hon. Member for Ross, Skye and Lochaber (Mr Kennedy)—I am sure that they will not have changed their views in the meantime and that government has not softened their strongly held beliefs. In support of the private Member’s Bill, the right hon. Member for Orkney and Shetland (Mr Carmichael) said:
“The notion that somebody other than the local community should own the seabed, particularly around our islands, and make money out of it for the Treasury, is quite offensive… The Crown Estate derives significant income from owning something the communities have an absolute need for in terms of piers and harbours, cables, fish farms and now the prospect of offshore windfarms. These are things we can’t do without.”
In November 2010, the Liberal Democrat MSP for Orkney said:
“The Scotland Bill provides an opportunity to help coast communities and our aquaculture and marine renewable energy industries. The UK Government should review the Crown Estate’s role in Scotland and look at using the Bill to devolve powers and controls over the seabed.”
Even a senior Liberal Democrat Whip spoke up when he called on the Secretary of State for Scotland to direct the Crown Estate commissioners to relinquish their control of the Scottish seabed to local communities in Scotland. I hope that those words will be followed up with action tonight.
As the land reformer Andy Wightman has said:
“We thus now have a position where the Scottish Government supports the return of the administration and revenues of the Crown Estate to Scotland. It is joined by many others including the former Labour Minister of State at the Scotland Office, Brian Wilson, Highland Council, Professor James Hunter CBE, Orkney Islands Council, Lesley Riddoch”—
the broadcaster—
“the Scottish Islands Federation, Local People Leading…and Reform Scotland”.
In 2010, The Highland Council said of this clause:
“The Highland Council is firmly of the view that Clause 18 of the Scotland Bill does not go far enough. The Council believes that the only way to ensure improved accountability and that direct benefits are delivered to Scottish communities is through fully devolving the management, administration and revenues of the Crown Estate in Scotland to Scottish Ministers in the first instance. Given the new management, regulation and planning roles of Marine Scotland, the case for full devolution is even stronger.”
Crown Estate lands in Scotland are best managed by the Scots Government. Holyrood’s sole purpose is to look out for the best interests of Scotland. By definition, the UK Parliament must have a different perspective. So far, that has meant cutting coastguards and the armed forces in Scotland and increasing fuel taxes. A Crown Estate that is only accountable to this place is bound to act by that same logic. If the Government truly intend to make the Bill the greatest act of devolution for 300 years, the Scots Government, of whichever party, should entirely run the Crown Estate lands in Scotland. Anything else is utterly unacceptable.
Mr Reid
A lot of what the hon. Member for Na h-Eileanan an Iar (Mr MacNeil) has said about the Crown Estate is correct. It should be working much more closely with local communities, and coastal communities should be benefitting from the money that the Crown Estate gets from leasing the sea bed and foreshore. My problem with new clause 10 is that it does not tackle section 1(3) of the Crown Estate Act 1961, which reads:
“It shall be the general duty of the Commissioners, while maintaining the Crown Estate as an estate in land (with such proportion of cash or investments as seems to them to be required for the discharge of their functions), to maintain and enhance its value and the return obtained from it, but with due regard to the requirements of good management.”
Mr Reid
I wanted what I still want—the devolution of power to local communities, so that the benefits go to those communities. As I have said, however, new clause 10 does not deliver that, because it does not amend the section from the Crown Estate Act 1961. The Secretary of State has powers of direction, which the new clause would transfer to a Scottish Minister rather than to local communities.
Another problem is the legal advice received by the Government about the operation of section 1(3). When the Secretary of State gave evidence to the Scottish Affairs Committee on 16 February, he was asked about the Crown Estate. He told us about the legal advice he had received. He said that
“the power of direction remains a kind of power of last resort if there are some very serious problems with the Crown Estate. The power of direction is not an invitation to the Secretary of State to micro-manage how the Crown Estate operates.”
By simply transferring that power of last resort to Scottish Ministers, the new clause is not going to achieve anything for local communities in Scotland. We need much more radical reform of how the Crown Estate operates than that.
A lot of evidence was given to the Calman commission to the effect that the Crown Estate was giving too great a priority to maximising income. That is certainly correct, because the Crown Estate Act 1961 puts that duty on the Crown Estate commissioners. We need a review of the 1961 Act and an amendment to section 1(3). The Scottish Affairs Committee has decided to investigate the operation of the Crown Estate in Scotland, and I hope that out of that will come proposals for reform to allow powers genuinely to be transferred to local communities, so that they also benefit from the lease of the sea bed and the foreshore. As the hon. Member for Na h-Eileanan an Iar has pointed out, marine renewable projects are likely to go ahead in Scottish waters in the next few years, and I want the income from that to go to the local communities.
On the income from the Crown Estate, as the hon. Member for Na h-Eileanan an Iar has said, only 6% of its UK-wide income is generated in Scotland, which would mean Scotland being given only 6% of the Crown Estate’s income. That does not seem to be a particularly good deal in comparison with Scotland’s current share of UK public spending. The important point is that the income, instead of just disappearing into the coffers of the Scottish Government and instead of going into the coffers of the Treasury, should actually go to local communities.
Mr MacNeil
I am listening carefully to what the hon. Gentleman is saying, and I am sure that many other people will be listening to—and especially looking at—it. For the purpose of clarity, will he outline how he has changed his viewpoint over the past few years on this issue? I hope getting into government is not the reason.
Mr Reid
My viewpoint has not changed. I still want to see the benefits from any developments going to local communities, and I want local communities to be much more involved in the planning stages, so that they can affect any decisions about developments on the sea bed close to their island or coastal community. The point that I am making is that the new clause does not remove the duty on the Crown Estate commissioners to generate revenue for the Treasury. The provision is defective in that regard.
Mr MacNeil
To sum up the hon. Gentleman’s views, then, London is best and control from London is best.
Mr Reid
I have already said umpteen times that I want power devolved to local communities, which the hon. Gentleman’s new clause simply would not achieve. I would have thought that in Argyll and Bute, as much as in the Western Isles, Edinburgh is not seen as part of the local community. The money would simply be transferred from the Treasury to Edinburgh. It is not going to help those local communities, and it will not even help the Scottish budget, which would benefit from only 6% of the income, which is less than Scotland’s current share of UK public expenditure, as I have pointed out.
The ownership of the sea bed and the Crown Estate’s management of it impacts on many remote communities, which often have fragile economies and their own local culture. One fundamental policy of the Government is the principle of localism, and I would like to see the Government implement that principle with regard to the Crown Estate. The Crown Estate must become much more democratically accountable to the communities where it operates, and it must work much more closely with local communities in the planning stages of any developments, which must benefit those local communities —for example, by making improvements to harbours and other local infrastructure or using the profits from the rent of the sea bed to set up funds for the benefit of the local community.
I am sorry that I cannot support the new clause. As I have said, it is defective, because it does not touch section 1(3) of the Crown Estate Act 1961. Given the importance accorded by the Government to the localism agenda, I hope that the Minister will be able to tell us later that the Government have plans for the Crown Estate in that regard.
Ann McKechin (Glasgow North) (Lab)
The hon. Member for Argyll and Bute (Mr Reid) has carefully explained some of the technical problems with the new clause. What it proposes was not a recommendation made by the Holyrood Committee in its report last week. The hon. Member for Argyll and Bute made an important point when he said that devolution is not simply a one-way process from the UK Government to the Scottish Government, but is also about transfers of power from central Government—whether based in London or Edinburgh—to bring about more localised control. It is about not only having powers, but how those powers are going to be used and made accountable to local communities.
It is interesting to note that the hon. Member for Na h-Eileanan an Iar (Mr MacNeil) has raised the issue of the Forestry Commission. It was his party’s Administration in Holyrood, of course, who were the first to propose privatisation of Forestry Commission land. Thankfully, there was a successful public campaign in Scotland—just as we recently saw in England—which forced the Scottish Government to reverse their policy. I note from recent reports, however, that they are continuing to sell off much more forestry land than they are purchasing from the Forestry Commission. That brings us back to the question of how powers are used. The Opposition will not support the new clause, but we hope to come back to this matter with our own amendments on Report.
Jacob Rees-Mogg (North East Somerset) (Con)
I am sorry not to be able to support the new clause moved by the hon. Member for Na h-Eileanan an Iar (Mr MacNeil), who is in many ways a walking advertisement for the Union. It would be a great loss to this Parliament if he were not here and were prevented from coming here by a division between our two great countries. I am deeply concerned about his new clause. It is partly creeping republicanism, partly an attack on property and partly a subsidy to Scotland from the poor, hard-done-by English taxpayer, who has had enough of this and wants a little bit of money to creep back south of the border from time to time.
Let me start with that sad day in March 1603, when our beloved sovereign of blessed memory, Elizabeth, died. When she died, James VI was hailed as James I of England, and we saw a mystical union of the Crowns: a mystical union that has remained true through not only world wars but civil wars, and has brought our people together. We have come together as peoples in the Crown, and as a result of a further development in the Act of Union 1707, we have come together as a Crown in Parliament. Anything that attacks the Crown, that undermines the Crown, is something about which we, representing one part of the Crown in Parliament—one part of the great system of government that we have—should always be careful.
Mr Weir
The hon. Gentleman’s history lesson is very interesting, but I am not sure why he sees the new clause as an attack on the Crown. The Crown Estate’s money does not go to the Crown; it goes to the Treasury. It was signed over to the Treasury many years ago in exchange for the civil list. The new clause attacks not the Crown but the way in which the money is used, and is intended to secure a better deal for our coastal communities.
Jacob Rees-Mogg
I thank the hon. Gentleman for an extremely helpful intervention. It missed a key point. Indeed, the hon. Gentleman may wish his hon. Friend the Member for Na h-Eileanan an Iar to withdraw his new clause.
The Crown Estate’s income was not given away in perpetuity in exchange for the civil list; it is given reign by reign. That started in the time of George III, who was a bit hard up at the time. He needed the money. Parliament had, and of course still has, tax-raising powers. In exchange for the Crown Estate’s income, George III accepted the civil list. That continued during the reigns of George IV, William IV, Queen Victoria, Edward VII and George V, the brief reign of Edward VIII and the reign of George VI, and it continues during the reign of our present most glorious sovereign. However, it is not a permanent settlement.
Any step that undermines or changes the Crown Estate should be taken with the greatest caution. I hope that the day never comes, but if we were to have another sovereign, that sovereign would be entitled to claim the Crown Estate for himself. If we had introduced measures that took it away, we would have broken the bargain that was made in the reign of George III and has been renewed in subsequent reigns. We should be extremely wary of interfering with a system that has worked so well.
I also want to deal with the attack on property rights, which are the fundamental basis of a free society and the rule of law. I know that some hon. Members like me to dwell on history occasionally. We know that rights of property have been established in this country since 1189—
Jacob Rees-Mogg
This country, England, which is where we are now. Those rights of property, established in this country, England, were passed to Scotland by virtue of the Act of Union. It is well established that the combination of Parliaments that resulted in the inheritor Parliament—this Parliament—merged the benefits of the two earlier Parliaments. The rights of property that we enjoy are the foundation of our free society.
Ann McKechin
I declare an interest as a member of the Law Society of Scotland. Scotland has always had a very distinct property law system. It was the first in the world to involve a public register, and it remains distinct to this day.
Jacob Rees-Mogg
I entirely accept that Scotland has its distinct characteristics. They are, in many ways, extraordinarily admirable and worthy, and they have the full support of those who support the Union. We do not want an homogenised United Kingdom. I have never been a great believer in homogenisation, whether it be of cultures, nations or, for that matter, milk. However, it is important to recognise the rights of property. The new clause seeks to confiscate the revenue that would come to the Crown Estate and take it for local communities—whoever they may be.
Mr Reid
The new clause does not do that. It merely transfers the power of direction of the Crown Estate from the Secretary of State for Scotland to a Scottish Minister, and that is why I consider it defective. It does not take the property that is in the seabed and give it to local communities.
Jacob Rees-Mogg
I thank my hon. Friend for his intervention, but I listened carefully to the speech of the hon. Member for Na h-Eileanan an Iar, and he made clear that his intention was to undermine the rights of property. That is why the new clause is so dangerous. The money that comes from any wind farms that may be established offshore in Scotland belongs to the Crown Estate, and the Crown Estate’s income is used for the benefit of the whole United Kingdom. To pinch it and say “We will have it for Na h-Eileanan an Iar”—or for some similar part of the country, or for communities within Na h-Eileanan an Iar—would, in my view, be wholly inappropriate, and would constitute a fundamental attack on the property rights of the Crown Estate.
Once one attacks the property rights of the Crown Estate, whose property rights will one not attack? If one attacks the property rights of the highest in the land, what protection will there be for anyone else? What protection will there be for the person in his humble cottage? If one attacks the Crown, the person in his humble cottage will feel the threat. He will feel the hot breath of rapacious socialism bearing down upon him. He will feel not the least bit safe on the land that he owns.
Stewart Hosie
The hon. Gentleman is making an extraordinary speech. I have received an e-mail from a colleague who has been watching it and who describes it as “epic”. It certainly is, in an 1842 kind of way.
However, I have a question for the hon. Gentleman. He talks of “rapacious socialism” and of the seizing of land. The Land Reform (Scotland) Act 2003, which came into being after the establishment of the Scottish Parliament, allows those on estates to buy the land on which they live. Would he wish it to be repealed to protect what he views as the property rights that he is defending?
Jacob Rees-Mogg
Had I been a Member of Parliament at the time, I would have opposed leasehold reform. I thought that it was an outrageous attack on property rights, and I would have taken the same view had I been a Member of the Scottish Parliament. I think that property rights are of overwhelming importance, and that the new clause is genuinely dangerous in seeking to undermine them.
As I was saying, my three reasons for opposing the new clause are the attack on property rights, the attack on the Crown—that mystical union of Crowns that we have had since 1603—and the loss of revenue for the English. I feel that I must stand up for the people of North East Somerset. They do not benefit from as much spending per capita on the health service, the police or education as those north of the border. I accept that, because I believe in the Union and I think it a price worth paying, but the price must be fair. The revenues that are ultimately the revenues of the state must come centrally, and must be shared out proportionately. When the Scots start asking “Why do we not have Crown Estate revenue for the territory and the sea around Scotland?”, I may respond by asking why people living in London do not say “We will have the revenues from the Crown Estate in London, and we will not allow any subsidy to be given to Scotland.” That, I think, would make the Scots rather upset. A good deal more money comes from places such as Pall Mall, which is owned by the Crown, than from the seashore.
Mr MacNeil
I had not taken the hon. Gentleman to be a fan of Scottish independence. I will clearly have to review that, given his latest utterances.
Jacob Rees-Mogg
I said earlier that I was against Scottish independence, because if we had it we would not benefit from such helpful and informative interventions as the one that we have just heard from the hon. Gentleman.
Mr Reid
I think that the hon. Gentleman has miscalculated. The hon. Member for Na h-Eileanan an Iar (Mr McNeil) is being principled. He believes in Scottish independence. Transferring the Crown Estate in its entirety would be disadvantageous to Scotland, because only 6% of the profits are generated there. That is less than Scotland’s current share of public expenditure. The new clause ought to appeal to the hon. Gentleman in financial terms.
Jacob Rees-Mogg
I think that those of us who support the Union are also being principled. These tax revenues—these forms that generate income for the state—must be preserved in their entirety. Once we start cutting them up bit by bit, we end up making calculations and saying “Actually, Scotland is receiving rather too little from the Crown Estate rather than too much.” I do not think that that argument works. I think that the Crown Estate must be viewed as a whole, as an indivisible part of an indivisible Crown. That is what I want to see: the traditional constitutional position which this country has enjoyed and which has made it such a great nation. Let us have no more attacks on private property or the indivisibility of the Crown, and let us have a reasonable settlement in taxation between the people of England and the people of Scotland, not to mention those of Northern Ireland and Wales, who also deserve their fair share of the total pie of economic wealth.
David Mundell
I welcome the contribution of my hon. Friend the Member for North East Somerset (Jacob Rees-Mogg), because I am afraid that our debates on matters Scottish tend to become somewhat homogenous, and it is good to have a different perspective on our deliberations. It was also good to hear again about the threat of the hot breath of rapacious socialism and the harm that it can do in Scotland, because we need to hear that. As we near the forthcoming Scottish Parliament elections, I will urge my colleagues to do their best to repel that threat.
My hon. Friend’s contribution was in marked contrast to that of the hon. Member for Na h-Eileanan an Iar (Mr MacNeil), who again sped through his speech, which was simply a recounting of the usual dogma. Instead of making a coherent case, he simply said that the Crown Estate should be devolved to Scotland because everything should be devolved to Scotland.
Those of us who have been present in the Chamber throughout the deliberations on this Bill noted yet again the strong divergence between what we have come to know as London SNP and Edinburgh SNP. Although the hon. Gentleman launched an attack on the Crown Estate, none other than Jim Mather, SNP Energy Minister in Scotland, has said that the Scottish Government
“greatly value the strong working relationship with the Crown estate commissioners as it helps us all to ensure that Scotland leads the UK in giving wave and tidal energy developers opportunities to harness the power of our seas.”
The characterisation of the Crown Estate by the hon. Member for Na h-Eileanan an Iar was therefore misleading. Although I take on board the points that the hon. Member for Argyll and Bute (Mr Reid) made about the operation of the Crown Estate, and acknowledge that he is a doughty campaigner for change to the estate, I am afraid that I do not recognise the characterisation of the hon. Member for Na h-Eileanan an Iar. As he knows, the Secretary of State has sought to engage with the Crown Estate, and the estate has moved forward in a number of positive ways, such as through the production of its annual report, and the meetings it has with Scottish Ministers, MSPs, Scottish local authorities and many interest groups.
However, although there are positive aspects to the development of the Crown Estate, the Government recognise that a number of issues have been raised during the progress of the Scotland Bill and following the Calman deliberations, which is why we look in particular to the Scottish Parliament LCM Committee report, which stated that it had identified a number of radical options for the future development of the Crown Estate but that time was needed to consider them. We agree with the Committee when it says that it noted with some interest that the Scottish Affairs Committee in the House of Commons will review the work of the Crown Estate commissioners in Scotland, and that that was an important development. The Secretary of State for Scotland’s positive attitude to this initiative was also noted. That sums up the Government’s position. We greatly welcome the inquiry that the Scottish Affairs Committee has said that it will carry out into the operation of the Crown Estate in Scotland. That will present an opportunity for the hon. Member for Argyll and Bute and others who have strong views about the Crown Estate to set them out, and the Government will look closely at the outcome of that inquiry.
What we will not do is respond favourably to dogma and to a view that the Crown Estate should simply be devolved for the sake of doing so. Although I have no hope that the hon. Member for Na h-Eileanan an Iar will do so, I ask him to withdraw the motion for his new clause.
Mr MacNeil
I noted that the hon. Member for Argyll and Bute (Mr Reid) said that coastal communities should benefit, but I was told earlier by a Liberal Democrat that they would look to mess about with a pretended technicality. Unfortunately, that is the usual stance of the Liberal Democrats: on the one hand it is not enough, yet on the other hand it is too much, and the upshot is that they want to leave it all with London. They will be judged in Scotland, so at least we will probably all be saved from having to listen to their pious words for years to come. In short, their position is that London is best, helping local communities is not on their agenda, and they will be voting for the status quo. Highlanders will know what to do at the May elections: sweep the Liberal Democrats away at the ballot box. Both the hon. Gentleman and Labour talk about local communities, but do nothing about that.
The hon. Member for North East Somerset (Jacob Rees-Mogg), whom I have great respect for and like personally, pronounces Na h-Eileanan an Iar very well. He did so not once, not twice, not three times, not four times, but five times. All I can say is he must have had a very good teacher. I should tell him, however, that Crown rights in Scotland long predate George III.
Jacob Rees-Mogg
For the benefit of the Committee, I should say that the hon. Gentleman himself was my teacher.
Mr MacNeil
I accept any accolades coming my way.
I should also point out to the hon. Gentleman that this new clause contains no republican agenda whatever. In fact, ideas of republicanism were not anywhere near the front, let alone the back, of my mind when I was framing it and making my speech. The new clause addresses the difficulties facing local communities; it is not an attack on property rights in Scotland, and the issue addressed here extends further than the Union of the Crowns, as I have said. Those property rights could be abolished by the Scottish Parliament. It has the powers to do that, although it would be what has been described as the nuclear option. These property rights are controlled by the Scottish Parliament, and they could be gone.
Mr Reid
The hon. Gentleman is right to say that the Scottish Parliament already has those powers. He has not responded to what I said earlier about section 1(3) of the Crown Estate Act 1961, however. The hon. Gentleman says his new clause will do great things for highland communities, but how is transferring the 6% of the profits of the Crown Estate from London to Edinburgh going to benefit local communities?
Mr MacNeil
The hon. Gentleman has been living in Scotland long enough to know that Ministers in Scotland and the Scottish Parliament are far more susceptible to pressure from communities in Scotland than the Chancellor of the Exchequer is at No. 11 Downing street.
The hon. Member for North East Somerset will not be surprised to learn that I am no great fan of the 1707 Union, but I am quite relaxed about the 1603 Union and the maintenance of Her Majesty as the Queen. The hon. Member for Liverpool, Walton (Steve Rotheram) put it to me that Scotland does indeed have a king and his name is Kenny, but that is a little beside the point. I am happy to maintain the Crown, as Canada, Australia and New Zealand do. My point is about the movement of powers from Westminster to the most democratic forum representing Scotland, which is the Scottish Parliament—that is the right way to proceed.
Jim McGovern (Dundee West) (Lab)
The hon. Gentleman says that he has no wish for his contribution to be viewed as republicanism. What are his views on republicanism?
Mr Gregory Campbell (East Londonderry) (DUP)
It does not work well in Ireland.
Mr MacNeil
I should have known that someone from the economic powerhouse that is Northern Ireland was sitting behind me—I say that with irony.
Unfortunately, the Minister indulges in the usual slurs and dogma, and he is wrong in some of his assertions. He said nothing about helping communities; he tried to pin all this on some sort of political agenda in the Scottish National party. The new clause is not about that; it is about the powers people need to affect the day-to-day occurrences in their communities and around their islands. Tonight, people will see past the words of certain politicians.
Mr MacNeil
No. I do not know when we last had a vote on this, but tonight’s vote will enable people to make many judgments for years to come. We will judge this for years to come.
Question put, That the clause be read a Second time.
Mr MacNeil
I beg to move, That the clause be read a Second time.
This is my third speech of the evening and I plan not to take too much time about it. The hon. Member for Rutherglen and Hamilton West (Tom Greatrex) asked whether we could have the past five hours back. For most of that I blame the hon. Member for Central Ayrshire (Mr Donohoe), who took up more than half that time.
My ongoing dispute with the assignation of time in the UK is firmly on record, with three speeches in Hansard over the past few years. It is my intention with the new clause to put an end to my shouting at the sun that happens periodically in this place. The new clause has more to do with how we deal with the amount of sunlight that we have in Scotland and how that relates to time. It deals with any changes to the clocks in the UK.
As anyone north of Manchester knows, the northern part of the island known as Great Britain and the islands to the west and the north of Great Britain are subject to very odd sunlight patterns at times, owing to our longitude and latitude and the alignment of our islands. We have very different periods of daylight in the UK, both summer and winter. Our winter days are short, with sunrise not happening till 9 am, so we must be able to adjust our clocks for the best use of time. Over the past few centuries, politicians have been bringing forward proposals to address the issue, with the most recent proposal occurring in this Parliament as a private Member’s Bill, when the hon. Member for Castle Point (Rebecca Harris) demonstrated that there is still a drive to change the clocks unilaterally.
At present, 65% of Scots are against changing the clocks, according to a YouGov survey in February 2010. However, if fewer than 300 MPs at Westminster voted to change the clocks in the UK, those MPs would change the lives of millions. The Government can make these changes and the Scots Parliament has no redress. It has been and will continue to be argued that it will be impossible for someone in Scotland to call someone in England because of the time difference, which is bunkum, or that it will not be possible to take a train, because it is beyond the capability of the human mind for someone to adjust their watch by an hour—again, bunkum. I have faith that everyone can adapt to the slightest change.
Mark Lazarowicz
I am not sure why the hon. Gentleman has changed his position from the one that he took in the debate on 26 January 2007 on the Energy Saving (Daylight) Bill, when he said:
“Unfortunately, we cannot go down the two time zones route. . . We cannot have two different time zones in the UK.”
When pressed by some amazed MPs, the hon. Gentleman repeated that
“we cannot operate two time zones”.—[Official Report, 26 January 2007; Vol. 455, c. 1733.]
He said a third time in that debate that he could not support two time zones in the UK, but his new clause would allow precisely that. I wonder why he has changed his position.
Mr MacNeil
My position has not changed. The point of the new clause is to make sure that nothing is foisted on Scotland. It will also put the brakes on any attempt to introduce two time zones.
Sheila Gilmore
No one is more against the proposal to change the time zones than I am, because I lived through the previous experiment and it was awful. However, the hon. Gentleman said that he did not want two time zones, but if his new clause was accepted and the UK Parliament voted to change the hours, the effect would be just that—two time zones.
Mr MacNeil
My new clause would make it unlikely—or even impossible—that a time change could be foisted on the people of Scotland, because of people’s fear of having a change in time zones.
More astute Members will know that my new clause does not call for a separate Scottish time zone. What I am saying is that if the UK Government make a decision regarding time systems, the Scots Parliament should have the right to make the best choice for Scotland. That is not a revolutionary or novel suggestion: the Northern Ireland Assembly at Stormont has that power, as does the Parliament of the Isle of Man. I note that they have not yet changed their time systems, even though they have the right to do so to address the needs of the people of Northern Ireland or the Isle of Man. The Scottish Government should have the same powers.
Sir Alan Beith (Berwick-upon-Tweed) (LD)
My constituency would be significantly affected if there was a different time zone just down the road from Berwick-upon-Tweed. Does the hon. Gentleman not recognise that in many ways he would make it easier for the UK Government, looking at the matter from an English point of view, to create a time system that was unwelcome in Scotland, because English MPs could say, “Well, Scotland can do what it likes. We’re doing what’s best for England”? With the large of number of English MPs, he might finish up with precisely the results that he most fears.
Mr MacNeil
I take the right hon. Gentleman’s point, but the realpolitik of the situation would make that highly unlikely. It is far more likely that something that the Scottish people did not want would be foisted on them.
Mr Frank Roy
Does the hon. Gentleman agree that if his new clause won the day, there would be a far greater possibility of two time zones?
Mr MacNeil
I would ask the hon. Gentleman whether he prefers the possibility of a time zone that the Scots do not want being foisted on them to having two different time zones in the UK. I would prefer the Scots to be able to control their own time zone to the possibility of something being foisted on them, so that they had the same power as the Northern Ireland Assembly in Stormont and the people of the Isle of Man.
Mark Lazarowicz
I genuinely do not understand how the hon. Gentleman has changed his position from the one that he took in 2007. His new clause would not give Scotland a veto power; it would give it the power to decide on time zones and the subject matter of the Summer Time Act 1972. He is bringing the possibility of having two different time zones closer, as the right hon. Member for Berwick-upon-Tweed (Sir Alan Beith) pointed out. The hon. Gentleman’s new clause would not give Scotland a veto power, and if that is what he wants, why has he not tabled a new clause that would?
Mr MacNeil
The question of a veto goes both ways. I would not seek to veto what the good people of England might want to do, but they would be far less likely to do it, given the realpolitik of the situation, if the people entering the argument on both sides had that power. I am seeking to give the Scots Parliament the same authority as Stormont—an Assembly that seems to have a number of dispensations, including on corporation tax and, in this case, time—and the Isle of Man.
Sammy Wilson (East Antrim) (DUP)
Does the hon. Gentleman recognise, first, that this was not a power that was specifically sought by the Assembly at Stormont? Secondly, the freedom that he seeks through the new clause implies the ability to exercise it. However, I cannot think of anyone in Northern Ireland who would wish to exercise it, for all the reasons that have been given so far, the main one being the disruption to movement between the two parts of the United Kingdom.
Mr MacNeil
It may or may not be a power that people in Northern Ireland wish to exercise, but it is a power that they have. It would probably not be a power that anyone would choose to exercise in Scotland either, but it would certainly make the Scottish hand an awful lot stronger in any negotiations with Westminster, as the complexion of the Government changed over time. What I would ask the hon. Gentleman is whether he would wish to surrender that power to Westminster or whether he would keep it.
Sammy Wilson
I do not think that anyone in Northern Ireland would give two hoots whether the power was surrendered or not, because if we are never going to exercise it, why would we worry about losing or gaining it?
Mr MacNeil
I say to the hon. Gentleman, tongue in cheek, that it is “Maybe surrender” from the DUP.
The point is not about using that power, but about the authority that comes from having it. It is about having that club in the golf bag or in the locker. That speaks to a wider problem with devolution: the UK Parliament can potentially take damaging action against a nation of the Union, but that nation’s Parliament or Assembly has, in the main, no redress and must accept the action. This might sound a bit drastic, but the way the Scotland Act is designed ensures that the UK Government, for better or worse, have unilateral power to make substantial decisions for the entire UK, regardless of what another part of the UK thinks.
Of course, Members should be reminded that “UK Government” does not mean this Parliament, as we saw with the Scottish Adjacent Waters Boundaries Order 1999, which affected 6,000 square miles of Scottish waters, as was mentioned earlier. I understand that the current Government are not committed to changing the clocks, but I would sleep much better at night if we could ensure that a clock change would have to be agreed by the Scots Parliament and that we had that power in Scotland before it took effect. It speaks volumes that the opposition to independence, and even to full fiscal autonomy or control over time, is full of the politics of fear.
Mr MacNeil
No, you’re fine.
If the Government and the Unionist parties truly believe that this is an economic arrangement that is in the best interests of the people who live in the islands, they have nothing to fear by giving Scotland control over clocks, coastguards, elections and fiscal autonomy—the whole gamut. There is usually nothing but dogma blocking good sense.
Iain Stewart
It is with a heavy heart that I rise to oppose the new clause tabled by the hon. Member for Na h-Eileanan an Iar (Mr MacNeil)—I hope my pronunciation is acceptable. As he mentioned, we had an interesting debate on the private Member’s Bill on daylight savings before Christmas. He and I, along with an eclectic mix of Members, went into the No Lobby to oppose it. I agree with him about the effects that central European time or double summer time, whatever we call it, would have on Scotland, on other parts of the UK and on various categories of workers in different industries. I am at one with him on that and have great sympathy with his motives, but I cannot agree with the methodology he uses to arrive at his conclusions. I agree with my right hon. Friend the Member for Berwick-upon-Tweed (Sir Alan Beith), who noted that the new clause, if successful, would make it easier for the House to approve a move to central European time or double summer time and that we would end up with two time zones in the UK.
Before moving on to some of the practical difficulties that such a move would entail, I caution the hon. Member for Na h-Eileanan an Iar against opening up head L5 of schedule 5 to the Scotland Act 1998, because along with
“Timescales, time zones and the subject-matter of the Summer Time Act 1972”,
a host of other matters are reserved, including
“The calendar; units of time; the date of Easter”.
We are already in enough trouble with Cardinal Keith O’Brien about other matters before we start tinkering with the date of Easter, so I urge some caution in going down that route.
As Members have explained, it would be hugely impractical to have different time zones within the UK. Other countries, of course, do have different time zones: Australia has four, Canada has six and Russia has eight. However, Australia is 2.9 million square miles in size, Canada 3.8 million square miles and Russia 6.6 million square miles. The UK is 94,000 square miles in size. To have different time zones in a relatively small geographic area is ludicrous. I can think of all sorts of practical difficulties that that would entail, particularly for people living in areas on either side of the border. People in Carlisle and Dumfries, for example, would have all sorts of problems adjusting their clocks as they went back and forward over the border. Would “News at Ten” be subject to the Trades Description Act if it did not broadcast as “News at Ten (but Nine o’clock in Scotland)”?
Mr Davidson
If there had been a different time, would the news of the Barnsley by-election result have arrived sometime in the middle of the morning?
Iain Stewart
The hon. Gentleman mentions an important reason why we should resist such a measure. I recall his state of excitement and sleeplessness as he awaited the result, and he might have had to wait a little longer to receive the information that he sought.
Mr Davidson
Is it not possible that I might have heard the Barnsley by-election result before the polls had closed in Barnsley?
The Temporary Chair (Mr Joe Benton)
Order. I think we have heard enough about the Barnsley by-election. Can we please come back to new clause 11?
Iain Stewart
I certainly shall, Mr Benton. The hon. Gentleman tempted me down an interesting path.
Members who were present yesterday when we debated clause 26, which relates to the definition of a Scottish taxpayer, might recall our discussions about how to define a Scottish taxpayer based on their place of residence at the end of the day. I expressed some concern for my friend who would be travelling on the Caledonian sleeper and mentioned the uncertainty that would arise if he boarded the train in Glasgow or Edinburgh at, say, 10.30 pm and was in Scotland at the end of the day as far as that was concerned, but the train crossed the border at midnight. I asked, would he be in Scotland or England for tax purposes? We would now add in a different time zone.
Iain Stewart
The devolution of tax powers to Normandy or Brittany is slightly outwith the scope of this Bill, so I will not risk the ire of Mr Benton by going down that route.
If there were a different time zone and England were an hour behind Scotland, my friend could board the train in Glasgow before midnight and arrive in England before midnight, so goodness knows what tax status he would incur for that journey. We often hear of the Bermuda triangle, but I do not want to introduce a Beattock triangle.
Roger Williams (Brecon and Radnorshire) (LD)
Does the hon. Gentleman think that arriving before one sets off is a contradiction of the general law of relativity?
Iain Stewart
I am grateful for that information. Unfortunately I ceased to study physics after higher grade, so I am not qualified to go down that route.
The example I cite is perhaps slightly silly but there is a sensible point. It illustrates the practical difficulties that would arise if we had different time zones in a small geographical area. Although I am at one with the hon. Member for Na h-Eileanan an Iar in opposing the introduction of central European time or any other Europeanisation of our time in this country, I must reluctantly oppose the new clause. I urge him and other Opposition Members to continue to oppose any moves in this place to introduce such a time zone in Scotland or anywhere else in the United Kingdom.
Mr Russell Brown
I will be brief. My hon. Friend the Member for Glasgow South West (Mr Davidson) mentioned something that is not a pastime of every Scot, despite what some people might think. It relates to drinking hours and what would happen if we operated in two different time zones.
I think back to many years ago when the pubs in Scotland used to close at 10 pm, whereas in Carlisle and in Cumbria, on the border, they closed at 11. We saw people walking down the road at 10 o’clock closing in Scotland and heading for the first hotel to partake of their pastime in Cumbria, so the hon. Member for Na h-Eileanan an Iar (Mr MacNeil) needs to be very careful.
Mr MacNeil
My new clause does not call for two time zones. Having lived in Gretna, I should like to know how long it would take me to walk from there to Carlisle for a pint. I suggest that it would be more than an hour, and that the bars would be closed by the time I got there.
Mr Brown
I must tell the hon. Gentleman that we have moved on: we now have trains, buses and taxis, so people would not necessarily walk.
I want to get back to the debate on the hon. Gentleman’s new clause, because I want the House to have time to debate new clause 19 as well. The hon. Member for Milton Keynes South (Iain Stewart) said that the hon. Gentleman’s proposal was ludicrous; I would go further and say that it is sheer lunacy. In January 2007, the Energy Saving (Daylight) Bill was introduced by the hon. Member for South Suffolk (Mr Yeo). Many Members might have considered supporting it, but for the fact that it contained a nasty clause that gave the devolved Administrations the opportunity to opt out. I ask the hon. Member for Na h-Eileanan an Iar and others who support his proposal to consider how the drivers in a small haulage business based in two locations—let us say Carlisle and Dumfries—would manage the tachograph when moving from one side of the border to the other.
The new clause makes no sense whatever. I hope that, rather than dividing the Committee on the proposal, the hon. Gentleman will see sense. His proposal would make it more likely that we would end up with two different time zones. I urge him to withdraw the new clause.
Fiona O’Donnell
I will make my contribution brief as well, although I shall not speak at quite the same speed as the hon. Member for Na h-Eileanan an Iar (Mr MacNeil). He reminded me of a child who needed to go to the toilet as he delivered his speech so terribly quickly. The hon. Member for Milton Keynes South (Iain Stewart) said that he had risen to speak with a heavy heart. I am rising with a sore head, and that is not just about the sleep deprivation that I mentioned earlier. It is because I honestly cannot understand what possessed the hon. Member for Na h-Eileanan an Iar to table this new clause. He cannot bring a proposal before the Committee and then not want us to discuss its possible implications. He cannot tell us what any Scottish Government, even his own, might choose to do with such powers, given that he voted against the sell-off of the forests in England while his Government tried to sell off the forests in Scotland. It is essential that we scrutinise the implications of the new clause. It exposes the fact that the SNP is good at minority reports and at gesture politics, but not good at government.
Dr Whiteford
I will take entirely personally the hon. Lady’s positive comment about minority reports. I took part in a debate on the issue of time zones a few months ago, and I was struck by the strength of feeling among many Government Members who represent English constituencies who would really like to see the time zones in this country change. My worry is that that would plunge my constituents into darkness on winter mornings, meaning that they would have to contend not only with icy roads and low temperatures but with limited amounts of sunlight. A Scottish Government would have no room in any negotiations on that matter, should a Government in this place choose to impose a change to the existing arrangements. As I understand it, the whole point of my hon. Friend’s new clause is to strengthen the likelihood of maintaining the existing arrangements, not to undermine them.
Fiona O’Donnell
I am still struggling to follow this argument. The SNP is asking for a power that it says it has no intention of using because the effects would be undesirable. The hon. Member for Na h-Eileanan an Iar seemed to say that, should the time zone change here, he would recommend that the Scottish Government fell in line with such a decision as he had no intention of having two different time zones. It has already been pointed out that we are far more likely to end up with two time zones if we devolve this power. It would be easier for such a decision to be taken simply on the basis of taking English concerns into account.
Mr Frank Roy
Does my hon. Friend agree that the only way to have two time zones in the United Kingdom is to vote for the new clause?
Fiona O’Donnell
Absolutely; I could not have put it more simply. My headache immediately disappears and we have clarity.
There are some questions that I would like the hon. Member for Na h-Eileanan an Iar to address. First, has he spoken to Microsoft or other PC manufacturers about their systems and whether they would be able to cope with this change? Has he considered the implications for travel? It is possible that I could leave my constituency and be in this place before I had left. I wonder how the Independent Parliamentary Standards Authority would respond to time travel and thinking that I came to this place in a Tardis. We have already heard about television and radio schedules. These are serious concerns, and they are the implications of what he is asking for. We might get the 10 o’clock news at 9 o’clock or 11 o’clock, we might know the results of the national lottery draw in Scotland before it is made in England. I have seen SNP Members holding their heads in their hands as we put forward these various possibilities, but if the hon. Gentleman is going to push the Committee to vote on this matter, he has to consider the ramifications.
Let us be clear about this: the SNP is no good in government in Holyrood, is no good in government in local authority areas, and in this Chamber it is putting forward a most ridiculous proposal that I hope the Committee will oppose.
Thomas Docherty
I want to make two observations based on an example taken from either side of the Committee. Under this proposal, the Minister from the Scotland Office could be taken in his Government car from his very nice house in Moffat down to Carlisle and then go back in time an hour to catch a train that had left Carlisle an hour earlier.
Mr MacNeil
I think that the hon. Gentleman, along with other Members, is confusing the instruments we use to measure time—clocks—with time itself.
Thomas Docherty
I think that the hon. Gentleman’s time is up.
Alternatively, my hon. Friend the Member for Dumfries and Galloway (Mr Brown) could leave his house, travel the 12 miles to Carlisle train station, and find that he is catching a train an hour earlier than he left his house. That is ludicrous.
Mr Weir
I am puzzled by this obsession with train times. Does the hon. Gentleman recall that for many years Switzerland, in the centre of Europe, had a different time zone from all the countries round about, and had trains going through on both sides? They did not vanish into thin air—they went in one end and came out the other. There is no problem about measuring time; this is utter nonsense.
Thomas Docherty
The hon. Gentleman takes me back to our debate on the railways. It might be helpful to certain Members to know that the railways are the reason we have a unified time zone across the United Kingdom. Up until the Victorian era, which certain Members clearly wish to drag us back to, there were different time zones in the west country, for example, from those in East Anglia. That was a ludicrous way to run a transport system, and that is why this is a mad idea from a fairly mad individual.
The other logistical issue touches on the point made earlier about Barnsley. In a general election, there could not be any exit polls or opening of ballot boxes until every area’s voting had closed at 10 o’clock. The people of Scotland would have voted from 7 am until 10 pm, according to their time, but in England it would have taken place from 6 am until 9 pm, so we would have to wait another hour before the opening of the ballot boxes, which brings us back to the debate about telling on the following day.
That goes to the heart of the fact that this is a nonsensical argument from a party that is trying to get independence. All SNP Members’ arguments about other countries arise from the fact that they cannot win the debate at the ballot box. They are going to be beaten in May harder than certain people were beaten in Barnsley last month, and this is another of their back-door efforts that should be rejected out of hand.
The Temporary Chair (Mr Joe Benton)
Order. For the record, I do not think that it was the intention of the hon. Member for Dunfermline and West Fife (Thomas Docherty) to declare the hon. Member for Na h-Eileanan an Iar (Mr MacNeil) mad.
Mr Davidson
I will start with a question. If the new clause is passed and the hon. Member for Na h-Eileanan an Iar (Mr MacNeil) goes to the other place, will that make him a time Lord? I hope that he presses the matter to a vote, because I can think of nothing that characterises the SNP more than this proposal for separate time zones.
As far as I can see, there are only two ways in which this new clause can operate. If the United Kingdom Parliament decides to change the time, it would give the Scottish Parliament the opportunity not to do so, in which case there would be separate time zones. Alternatively, the Scottish Parliament could decide to change the time on its own without the United Kingdom Parliament doing so, in which case there would be separate time zones. I see no logic for giving this power to the Scottish Parliament, except if one wants separate time zones. It is ludicrous.
The comments of the right hon. Member for Berwick-upon-Tweed (Sir Alan Beith) are key in this argument. The new clause would make it much more likely that this Parliament, with an overwhelming majority of English Members, would vote for what suited it and leave the Scots to either follow or not. That would undermine the position of Scottish MPs in representing their constituents’ interests in this place. The proposal is absolutely and utterly absurd.
We must also take into account what I consider to be the al-Megrahi argument. Part of the reason for the release of al-Megrahi was simply to show that the Scottish Parliament could do it. It had a power and wanted to show that it could use it, so it did. Giving the Scottish Parliament the power to change the clocks would present it with a strong temptation to do it just to show that it could, and to drive as big a wedge as possible between Scotland and the rest of the United Kingdom. That is a very real danger.
We should consider what sort of time difference the SNP would want. I think that it would probably go for something like—
Mr Davidson
Perhaps it would be a century, but I think that it would be just under an hour and a quarter. In that way, when it was noon by Greenwich mean time, it would be about 13.14 in Scotland. Scotland would constantly be on Bannockburn time. I think that the concept of Bannockburn time is what the nationalists are after: “Here’s tae us, wha’s like us. A lot of them are deid now right enough, but we do actually remember them.” This proposal is simply about seeking division for its own sake.
The hon. Member for Milton Keynes South (Iain Stewart) was very helpful in reminding us that schedule 5 to the Scotland Act 1998 covers more matters than just time. It also covers the calendar. I am sure that the idea of a public holiday on Alex Salmond’s birthday will be a recommendation from the SNP. We have had the Julian calendar and a variety of different calendars. A nationalist calendar is the logical consequence. Why should an independent country be stuck with the same calendar as England? There are logical arguments for that, but the SNP is not the party of logical arguments; it is the party of passion, of Bannockburn and of “Here’s tae us, let’s be separate.”
I think that there is a real difficulty in all of this. I very much hope that the SNP does not chicken out here. I hope that it puts the new clause to the vote so that we can see just how ludicrous its proposals are, and the extent to which it is treating the Scotland Bill as nothing more than a joke. We are trying to improve the governance of Scotland; the SNP is trying to create divisions. The proposal to have separate time zones is absurd.
David Mundell
I am starting to be very concerned about the extent to which I agree with the hon. Member for Glasgow South West (Mr Davidson). Indeed, the hon. Member for the Western Isles has done something remarkable this evening—he has led me to agree 100% with the hon. Member for Dumfries and Galloway (Mr Brown), which is a very rare occurrence. I could not have put it better—the new clause is sheer lunacy, and Members on both sides of the Chamber have set out why.
It is important to reflect on the findings of the Calman commission, which highlighted the importance of cross-border institutions and functions of the UK Government that bind the people of Scotland and the rest of the UK in a “social union”. It stated its view that a consistent British isles time zone was an important aspect of that. Of course, the SNP wants to destroy that social union. As has been said in the debate, having two separate time zones in the UK is one way in which it would seek to do so.
I think it was the hon. Member for Edinburgh North and Leith (Mark Lazarowicz) who pointed out the contradiction in the position of the hon. Member for Na h-Eileanan an Iar (Mr MacNeil), who has spoken passionately against any proposal to change the time, but who has now tabled a new clause that makes the change that he says he opposes much more likely.
From the outset, this Government have said that they would not consider adopting single/double summertime, central European time or any variation on them without the agreement of all nations of the UK. The Prime Minister has been unequivocal in stating that having different times operating concurrently in the UK is not an option. On Second Reading of the Bill introduced by my hon. Friend the Member for Castle Point (Rebecca Harris), the Under-Secretary of State for Business, Innovation and Skills, my hon. Friend the Member for Kingston and Surbiton (Mr Davey), made clear the Government’s opposition to the Bill. Additionally, as the hon. Member for the Western Isles will be aware, at the time of the publication of the UK Government’s tourism strategy on 4 March, the Under-Secretary of State for Culture, Olympics, Media and Sport, my hon. Friend the Member for Weston-super-Mare (John Penrose), reiterated the Government’s commitment that no change to current policy would happen without the approval of the whole UK.
Were the new clause to be accepted, Scotland would have the power to determine its own time zone. As the hon. Member for Glasgow South West pointed out, that would give the Scottish Parliament the capacity to make a change just for the sake of being different. The contribution to the debate that I thought was most illustrative was the one from Northern Ireland, from the hon. Member for East Antrim (Sammy Wilson). He indicated that although the power in question was available there, nobody would wish to use it. That brings us back to the dogma of the SNP in making proposals, as I have said before, either because it sees them as a way of breaking up the UK or simply for the sake of having power.
If Scotland were to have a different time zone from the rest of the home nations, daily transactions between Scotland and the rest of the British Isles would take on an unwanted added complexity. Importantly, it could put Scotland at an economic disadvantage. It could certainly disadvantage my constituents, and those of the hon. Member for Dumfries and Galloway and the Secretary of State for Scotland, which should not be countenanced.
The new clause would be detrimental to the Union between the people of Scotland and those of the rest of the UK, which is clearly why it was tabled. It runs contrary to the spirit and effect of the Bill and the views of the Calman commission, which put at the heart of its work the retention of the United Kingdom. Anyone who has a commitment to retaining the UK should oppose the new clause.
Mr MacNeil
The hon. Member for Milton Keynes South (Iain Stewart) pronounced my constituency name well, putting the Minister to shame—I note again that he referred to my constituency by its old name.
The hon. Member for Milton Keynes South and I agree on many things, and have together worked to fight off the forces of darkness who are trying to force central European time on us—they call it Churchill time, but we call it Chamberlain time, because it is definitely appeasement. He can rest assured that the date of Easter will remain the first Sunday after the first full moon after the equinox, which perhaps brings me neatly to the hon. Member for Glasgow South West (Mr Davidson). He is not keen on Bannockburn time, but I wondered whether he was working on moon time given some of his interventions and suggestions.
I am calling not for the time zone to change, but for the power to ameliorate if London makes a change. We in Scotland want to keep the time as it is. The danger is that London will foist something on Scotland that we do not want. The new clause is about giving the power to Scotland.
Mr MacNeil
That is very useful, but we do not know how long the Government will stand. How long will the Liberals and Tories remain in this embrace? We know that one Government do not bind another, and certainly that one Parliament does not bind another. This Government will probably not even bind themselves for much longer, but who knows? We want to give Scotland the power that Northern Ireland and the Isle of Man have.
The hon. Member for East Lothian (Fiona O'Donnell) has moved from what might once have been called rapacious socialism to a great concern for Microsoft—with not so much concern for the darkness of her constituents. Could Microsoft cope with the new clause? Yes, I think it could.
The hon. Member for Dumfries and Galloway (Mr Brown) seemed to be happy for the time difference to be foisted upon us and for us not to have a say. Many countries throughout the European continent—there are about 50—including small countries, have such a power. They choose to work together, but they feel that it is better to have the club in their bag. They find stability in that. There is instability here because Members from the south of England are ganging up and, because of amnesia of the last 30 or 40 years, changing the time zone on us.
I have a note here on the hon. Member for Dunfermline and West Fife (Thomas Docherty)—it says simply that I am disappointed in him. It is more likely that we would have different time zones in Europe if different countries did not have such a power. People tend to work together, but we should ensure that everybody has the same thing to take to the table. If we do not give Scotland this power, and if the time zone changes and we want to keep it as it is, the guilty will be all around us.
Question put, That the clause be read a Second time.
Mr Davidson
On a point of order, Mr Evans. Has it been established that all Members were aware of the time at which the vote was held? I understand that two of the nationalists will be here in about an hour and a quarter.
The First Deputy Chairman of Ways and Means (Mr Nigel Evans)
We will now move on to new clause 19.
New Clause 19
Regulation of food labelling and content
‘In Part 2 of Schedule 5 to the Scotland Act 1998 (reserved matters: specific reservations), at the end of section C8 to add the words “but this exception does not permit the Scottish Parliament to legislate on food content or labelling of foodstuffs that are placed for sale within Scotland”.’.—(Tom Greatrex.)
Brought up, and read the First time.
Tom Greatrex
I beg to move, That the clause be read a Second time.
I hesitate to introduce an element of gravity to the proceedings, given some of the entertainment that has featured so far. Over the past few hours, however, there has been much debate on issues that did not feature in the Calman report. This issue was dealt with in the report, but it does not feature in the Bill. It featured in the previous Government’s White Paper and is referred to in the Command Paper that accompanies the Bill, but it is one of the issues that appear to have fallen off the edge of the Calman process.
During this Committee stage the Government have produced explanations, some convincing and others less so, for the fact that they are not implementing some of Calman’s recommendations. Part of the purpose of the new clause is to give them an opportunity to explain why they are not implementing one particular recommendation. I note that the Scottish Parliament legislative consent memorandum Committee, in one of its conclusions, suggested that the Government provide a fuller explanation. As I am sure that its members read the Command Paper before reaching that conclusion, I suspect that merely repeating the terms of the Command Paper will not serve to provide the explanation sought by the Committee.
Fiona O’Donnell
Will my hon. Friend press the Minister to tell us what representations the Government have received from either the retail or the manufacturing sector in support of their action?
Tom Greatrex
I am grateful to my hon. Friend for her intervention, and I hope to address the point that she has raised.
Calman looked at this issue in a degree of detail. The issue was mentioned in the White Paper of November 2009, but it does not appear in the Bill. The new clause addresses Calman recommendation 5.11, which states:
“The Scottish Parliament should not have the power to legislate on food content and labelling in so far as that legislation would cause a breach of the single market in the UK by placing a burden on the manufacturing, distribution and supply of foodstuffs to consumers, and Schedule 5 to the Scotland Act should be amended accordingly.”
Calman looked at the exception of trade descriptions in relation to food from the general reservation of consumer protection issues in the Scotland Act 1998. At the same time, the devolved Administration in the Scottish Parliament have responsibility for public health. The evidence taken by Calman was largely oral, and it was instructive. The chief executive of the Food Standards Agency made it clear in oral evidence that the potential for policy divergence was a concern that should be eliminated by making a change akin to that proposed in this new clause and said that the information should be available throughout the UK. Evidence from representatives of both the Royal Environmental Health Institute of Scotland and the College of Medicine and Veterinary Medicine echoed that point and said there was a potential issue, although I am sure that the Minister will want to remind us that both of them made it clear that in practice there has not been a problem yet. This recommendation was welcomed by the Scottish Retail Consortium, CBI Scotland and the Food and Drink Federation. It was referenced in the Command Paper from which I assume the Minister will draw his remarks on this new clause, and it is a recommendation that we seek to insert into the Bill.
The Scottish Retail Consortium made a number of points about areas in which public health is not a factor, such as that a requirement to label or produce food differently in different parts of the UK places a heavy burden on retailers and manufacturers and could breach the ethos of the single market. A number of examples have been cited—for example, mandatory environmental labelling with different requirements in Scotland from other parts of the UK—that could place a financial and administrative burden on the food industry, and many of the companies affected would be small firms providing specialised products who do not wish their markets to be limited to just one part of the UK. The introduction of this measure would not stop the often successful voluntary schemes that already exist and to which the Command Paper makes reference.
The Government suggest in the Command Paper that potential activity by the Scottish Parliament in food labelling must be agreed by the UK Government and the European Commission, and therefore the protection is in place and is robust enough. The Command Paper goes on to suggest that this Calman recommendation is superfluous. There is a clear argument that it is not superfluous, but that what we require in this matter is clarity. That is the content of the representations from food manufacturers, food retailers and business organisations in Scotland.
This new clause enables the Calman commission recommendation, which mysteriously disappeared between the November 2009 White Paper and the Bill being published, to be enacted. It provides clarity, which is what the industry is looking for, and it provides an opportunity for the Government to deal with an issue that the Command Paper seems to wish to dismiss.
David Mundell
I welcome this opportunity to discuss a substantive issue in relation to the Calman commission report and the subsequent Scotland Bill. It compares favourably with some of the discussions and superfluous issues that have been raised by the SNP during the course of the evening.
Hon. Members will know that the Calman commission made a recommendation on food content and labelling which, as the hon. Gentleman has pointed out, is not included in the Bill. I shall set out the Government’s reasons for deciding not to include it, as was made clear in the Command Paper. Although the recommendation seems sensible on paper, it presents a wide range of difficulties in practice, and I shall set those out. As he has said, the Scottish Parliament’s report on the Scotland Bill also sought a fuller explanation for the Government’s position. The commission made the following recommendation:
“The Scottish Parliament should not have the power to legislate on food content and labelling in so far as that legislation would cause a breach of the single market in the UK by placing a burden on the manufacturing, distribution and supply of foodstuffs to consumers, and Schedule 5 to the Scotland Act should be amended accordingly.”
The commission also recommended that the Scottish Parliament’s and Scottish Government’s abilities to deal with public health issues should remain, so the recommendation does not cover this aspect, and the Government fully support that.
Importantly, and rightly, Calman recognised that food content and labelling are almost exclusively regulated at European Union level, so any scope for national flexibility at member state level when implementing this European law is extremely narrow. Hon. Members will know that general and nutritional labelling is currently being recast in a proposed European regulation. The resulting legislation will be directly applicable across the whole of the United Kingdom. A number of other labelling and food standards matters are governed by European directives.
Even where no specific food-related legislation has been adopted at European Union level, free movement principles mean that any food which can be lawfully sold in any member state must be able to be sold throughout the United Kingdom, and vice versa. Significantly, single market rules seeking to avoid barriers to trade being erected apply equally to rules applied in just one part of a member state. Any national measure would need to be notified at member state level, and clearance would need to be obtained from the European Commission before adoption. Before seeking such clearance, consideration would always need to be given to the potential for any disruptive impact within the United Kingdom.
I emphasise to right hon. and hon. Members that the Scottish Parliament is already in a position where it cannot legislate to set particular Scottish standards for food content in cases where that would breach the single European market or supplement existing European regulations. The Scotland Act prohibits the Scottish Parliament from legislating in a way that is incompatible with Community law, and Scottish Ministers have no power to carry out any executive act which is incompatible with that law—to do so would be ultra vires and any such act would have no effect.
It is relevant to the Calman commission’s recommendation that member states may restrict the free movement of goods in exceptional and limited cases. One example where that might be possible is if the Scottish Parliament were to need to take action for the purposes of public health. Again, however, Calman did not suggest any restrictions in this area. The Government are aware of only two instances where Scottish food legislation imposes different requirements from those that apply in England. First, the sale of raw milk or cream for direct human consumption is banned in Scotland but permitted, subject to certain restrictions, in England—European legislation specifically allows that. Secondly, the rules regarding food storage temperature control requirements are much more detailed in England than in Scotland. Both those differences predate Scotland’s ability to make its own legislation and both relate to food safety, not general food labelling or standards. That suggests to the Government that there is not a substantial problem to be addressed. There is therefore no need, in our view, to amend the Scotland Act.
Amending schedule 5 to the Act poses a number of possibly insurmountable problems, at the root of which is the fact that the Calman commission’s recommendation seeks to address a particular effect of legislation—that is, the breach of a single market. The purpose test that applies to the reserved matters in schedule 5 to the Act requires both the purpose and the effect of a provision to be taken into account. It is therefore possible for a provision to have an effect on a reserved matter and yet not relate to it when the purpose test is applied. Simply including a matter in schedule 5 does not guarantee that it can never be affected by legislation that is in the competence of the Scottish Parliament.
There is no precedent for enabling the Scottish Parliament to legislate on a matter provided that its legislation only has certain effects. Even if it were possible to create a new type of reserved matter, there would still be problems. Indeed, any such measure would depend on a definition of what is meant by the United Kingdom single market, which is a concept at the heart of Calman’s recommendation. Furthermore, any amendment of the Scotland Act would create a divergence between the different countries of the United Kingdom as the devolved institutions in Northern Ireland and Wales are not subject to equivalent restrictions.
To summarise, although Scottish Parliament legislation of the type that Calman’s recommendation is designed to prevent is theoretically possible, it is highly unlikely. The likelihood of the Scottish Parliament’s legislating on food content and labelling in a field where exemptions can be found from single market legislation and where any applicable European regulations can be simultaneously disapplied is very limited. The likelihood of its doing so for purposes that are not related to legitimate actions in the field of public health is extremely low.
Finally, any national measures on labelling or content where a member state may be able to act would need to be notified to the European Commission at member state level.
Mr Davidson
May I seek guidance from the Minister? If we have a vote on this matter, will all Unionist Members be voting at 10 o’clock and the nationalist Members be voting on the 13.14 principle at quarter past 11?
David Mundell
That is a very good point. One thing that always interests me about those who promote the time change is that they rarely seek to refer to it as central European time and the imposition of time from Europe on the rest of the—
The First Deputy Chairman of Ways and Means (Mr Nigel Evans)
Order. It was not a particularly brilliant joke the first time round. Can we now get back to new clause 19?
David Mundell
I apologise, Mr Evans, for getting sucked into matters that diverge from the subject under discussion.
The Government appreciate the concern behind the Calman recommendation, and we have fully considered its implications. The hon. Member for East Lothian (Fiona O'Donnell), who has shown great stamina throughout today’s proceedings by taking part in many of the individual debates, asked whether we had consulted the retail and business sector. I am pleased to tell her that I have met the Scottish Retail Consortium and discussed this issue in detail. I have also met the director of the CBI in Scotland, who has also previously set out concerns on this matter. I hope that I have been able to persuade both organisations that the legal basis, which I have set out in detail, is a sound one and is the basis on which the Government did not include that particular recommendation in the Bill.
On the need for legislative change, taking together all the points I have made, the Government do not necessarily consider—
Business without Debate
Mr Deputy Speaker (Mr Nigel Evans)
With the leave of the House, we shall take motions 3 to 7 together.
Motion made, and Question put forthwith (Standing Order No. 118(6)),
Road Traffic
That the draft Road Vehicles (Powers to Stop) Regulations 2011, which were laid before this House on 1 February, be approved.
Pensions
That the draft Financial Assistance Scheme (Revaluation and Indexation Amendments) Regulations 2011, which were laid before this House on 31 January, be approved.
That the draft Occupational Pension Schemes (Levy Ceiling) Order 2011, which was laid before this House on 3 February, be approved.
That the draft Pension Protection Fund (Pension Compensation Cap) Order 2011, which was laid before this House on 3 February, be approved.
Local Government
That the draft Greater Manchester Combined Authority Order 2011, which was laid before this House on 7 February, be approved.—(Angela Watkinson.)
Question agreed to.
European Union Documents
Motion made, and Question put forthwith (Standing Order No. 119(11)),
Charter of Fundamental Rights
That this House takes note of European Union Document No. 15319/10, Commission Communication on Strategy for the effective implementation of the Charter of Fundamental Rights by the European Union; supports the Government in welcoming the Commission’s work to ensure that EU legislation is compatible with fundamental rights; and notes the Government’s support for the principle behind Protocol No. 30 on the Application of the Charter of Fundamental Rights of the European Union to Poland and the United Kingdom, that the Charter does not give national or European courts any additional grounds on which to find that the laws of the United Kingdom are incompatible with the law of the European Union.—(Angela Watkinson.)
Question agreed to.
Business of the House
Ordered,
That, at the sitting on Monday 21 March, the Speaker shall put the Questions necessary to dispose of the proceedings on the Motion in the name of Sir George Young relating to Members’ Salaries not later than one and a half hours after the commencement of proceedings on the Motion; such Questions shall include the Questions on any Amendments selected by the Speaker which may then be moved; proceedings may continue after the moment of interruption; and Standing Order No. 41A (Deferred divisions) shall not apply.—(Sir George Young.)
Detention of Terrorist suspects (temporary extension) Bills Joint Committee
Education Maintenance Allowance
Sir Peter Soulsby (Leicester South) (Lab)
A few weeks ago, my right hon. Friend the Member for Leicester East (Keith Vaz), supported by my hon. Friend the Member for Leicester West (Liz Kendall) and me, launched a city-wide petition against the Government’s proposals to abolish the education maintenance allowance. Last week my right hon. Friend presented a petition presented by those who study at Gateway college in his constituency. Tonight I present a petition signed by those associated with Regent college and Wyggeston and Queen Elizabeth I college in my constituency.
Signed by 327 people, the petition states:
The Petition of residents of Leicester and the surrounding area,
Declares that the Petitioners oppose the abolition of the Education Maintenance Allowance; notes that a substantial number of young people are in receipt of the Education Maintenance Allowance in Leicester; and further notes that education can provide a better future for young people.
The Petitioners therefore request that the House of Commons urges the Government not to abolish the Education Maintenance Allowance.
And the Petitioners remain, etc.
[P000901]
Operation Ore (Staffordshire)
(13 years, 1 month ago)
Commons ChamberRead Full debate Read Hansard Text Read Debate Ministerial Extracts
Robert Flello (Stoke-on-Trent South) (Lab)
May I begin my thanking Mr Speaker for granting this debate? Those watching and listening will no doubt wonder why I want to raise something that happened such a long time ago. The simple answer is that my constituents have had to wait such a long time for an apology, and indeed are still awaiting an apology from Staffordshire police. I hope that following the debate the current chief constable, who is an honourable man, will move to ensure that that wrong is corrected without further delay.
I want to say something about Operation Ore in general. All aspects of child pornography are horrific, and I pay tribute to all agencies that act to stamp out that appalling crime. The victims need so much more than just sympathy. However, Operation Ore was not handled well: thousands of people were falsely accused, leading to 100,000 children being wrongly removed from their homes, people’s reputations wrongly being destroyed and, tragically, a number of people committing suicide. It is with that in mind that I turn to the circumstances of a constituent who, quite understandably, wishes to remain anonymous. Staffordshire police are fully aware of the case and know to whom I refer.
I wish to take the opportunity presented by the debate to raise the case of that constituent, who in December 2002 was arrested by Staffordshire police as part of Operation Ore, the British part of the global operation against internet child pornography. When I conclude my remarks, I will seek a number of reassurances from the Minister, whom I am grateful to see here this evening to respond to the debate.
Almost four years before the circumstances of December 2002, in January 1999, my constituent reported that his Barclaycard had been stolen. He reported it to a police station in Stoke-on-Trent, which issued him with a crime number, and to Barclaycard, from which he received a refund of £179.76 for some unlawful transactions made in the period between the theft of the card and his reporting it at the police station.
However, on 12 December 2002, eight officers arrived at my constituent’s home early in the morning amid a high police presence. Vans were parked for most of the day outside his home, which he shared with his parents, understandably arousing a great deal of interest in the neighbourhood. During the day a considerable amount of property, including computer equipment, was removed from the home. He was arrested on the grounds that the Barclaycard registered to him had been used in 1999 to access a website containing child pornography. I reiterate that it was in January 1999 that he had reported the theft to the police.
My constituent suffers from ulserative colitis, for which he had been taking prescribed medicine, which he informed the police doctor about early in his detention. His medication was brought to the police station promptly but was withheld from him until he was released at 7 o’clock that evening. As a result of the stress of his arrest and the withholding of his medication, his medical condition worsened, necessitating a medical referral to a consultant in order to rebalance the medication. It is only in recent years that his health has improved following the stress of that incident.
On 13 December 2002, the following day, my constituent was able to provide Staffordshire police with evidence that he had, indeed, reported the theft of his credit card in January 1999, and of the resulting refund from Barclaycard. As a result, no charges have ever been brought against him, and on 18 December 2002 all the property that had been seized on 12 December was returned. The police had checked the credit card database, but incredibly only back to 2002; the incident to which it related took place in 1999.
After much deliberation, during which the family tried to rebuild their standing in the community and to move on from the awful experience, my constituent and his parents decided in February 2003 to make formal complaints to Staffordshire police for wrongful arrest. These were acknowledged in writing on 25 February 2003 by the then deputy chief constable, David Swift, who informed both parties that their complaints had been passed to the force’s professional standards unit, where it would be handled by a Mr Hulse. On 6 March 2003, DCC Swift wrote again to my constituent’s parents, asking them to contact an Inspector Humphries within 14 days, which they did.
My constituent and his parents met the inspector in March 2003 and were told that, as my constituent had been the person arrested, any complaint should come from him. Therefore, the parents withdrew their complaint. My constituent was also persuaded not to pursue a formal complaint—he was told that this would be interpreted as a personal attack on the police officers—but to go down the route of an informal complaint.
Later that month, my constituent’s parents engaged a firm of local solicitors, and during a meeting Mr Hulse informed my constituent that, owing to a change in the police computer system, only records dating back to 2002 had been checked prior to his arrest, so the 1999 report of the theft of his credit card had not shown up. My constituents were advised by their solicitor that it would thus be difficult to proceed further with any complaint, as negligence would need to be proved, and that that would be an expensive undertaking for which legal aid would not be available.
In June 2003, my constituent’s parents wrote to the Metropolitan police, the lead force on Operation Ore, but their letter was merely forwarded to Staffordshire police, who informed them in July 2003 that the matter was now being dealt with by a detective inspector from the local CID.
In September 2003, my constituents engaged new solicitors, and a formal complaint for wrongful arrest was made on 1 October 2003, which Staffordshire police once again referred to the PSU in a letter dated 10 October. On 17 October, my constituent received a further letter informing him that Inspector Humphries was again handling their complaint.
There exists a withdrawal of complaint form, dated 24 October 2003, which apparently has been signed by my constituent. My constituent remains adamant to this day, however, that at no time did he agree to withdraw his complaint, sign any such document or have the inclination to withdraw his complaint. Staffordshire police appear to have no record of the original complaint, just the withdrawal of it, and in addition there are factual errors on the withdrawal form. In an effort to try to resolve that particular aspect of the case, I sought to view the original withdrawal form, and was told in no uncertain terms by the solicitors for Staffordshire police, “Who are you to be even considering reviewing such a document?” I am sure that the Minister will agree that so far the whole issue is of great concern.
In February 2004, my constituents’ solicitors informed Staffordshire police of their intention to seek damages for wrongful arrest and imprisonment, and that was acknowledged by Staffordshire police on 24 February 2004 and by the force’s insurers on 5 March 2004. In June 2004, my constituent was asked to provide some proof of his inability to work, and he was able to provide some evidence.
On 25 October 2004, however, Staffordshire police’s legal adviser, a Mr Griffiths, wrote to my constituents rejecting their claim, stating that in his opinion the arrest of my constituent had been lawful for the following reasons. First, my constituent did not inform the arresting officer of the 1999 theft of his credit card until part way through his first interview, not at the time of his arrest. Given the circumstances, it took some time for my constituent to be made aware of what he had been arrested for and all the implications of it. Secondly, the use of a credit card raised a prima facie case of suspicion, and the report of the theft of the card was not in itself proof of theft. Thirdly, officers had reasonable cause to suspect that my constituent was, according to Mr Griffiths’s letter,
“merely trying to pass the blame onto others.”
Those claims were rebutted by my constituents’ solicitors on 1 November 2004, who noted in particular that the use of a credit card online leaves a unique IP address, which would allow investigating agencies to ascertain the exact computer that had been used to access the illegal websites and whether my constituent had access to it. Indeed, that point has never been addressed by Staffordshire police. Mr Griffiths acknowledged that letter on 6 December 2004, and went on to concede that my constituent had made the arresting officers aware of the theft of his credit card at the time of the arrest, but that, apparently, that would make no difference.
Unfortunately, in January 2005, my constituents’ solicitors advised that they could see no reasonable chance of progressing the complaint further, and closed their file. In August 2005, my constituent made another formal complaint, this time on the ground of failure to provide prescribed medication. On 29 September 2005, Mr Griffiths wrote to my constituent, advising him that if he wanted to pursue the complaints, he should do so through legal representatives. In October 2005, my constituent complained further, to the Independent Police Complaints Commission, which informed my constituent by letter on 18 October that the IPCC had arranged for my constituent to be contacted by Staffordshire police to discuss the issue. According to my constituent, however, no such contact was ever made.
The years were now rolling on, and in December 2005, my constituent received a letter from the then Deputy Chief Constable Lee of Staffordshire police upholding the initial rejection of my constituent’s complaint, at which time my constituent asked the IPCC to undertake an investigation into why no pre-2002 records search had taken place, as such a search would have shown that the credit card had been reported stolen in January 1999. Unfortunately, the IPCC wrote back to say that, as the original complaint predated the IPCC’s formation and fell under the auspices of the Police Complaints Authority, it was unable, under law, to accept the complaint.
In August 2006, my hon. Friend the Member for Gedling (Vernon Coaker), in his then role as Under-Secretary of State at the Home Office, advised me that the Home Office could not become involved in the specifics of the case as it was an operational matter for Staffordshire police, and that he had forwarded my representations to Staffordshire police. He also suggested that any complaints about the IPCC be initially taken up with the IPCC caseworker. My constituent made a further complaint to the IPCC about its refusal to take up the complaint, but that was subsequently rejected. During 2007, again following further representations from me, Staffordshire police refused to reconsider my constituent’s early complaints. I was also, somewhat disturbingly, advised by the IPCC that it had no record of my constituent’s case file.
Having spent some time setting out the background to the case and the reasons behind the continuing anger and unhappiness of my constituent and his parents at the system of making a complaint against the police, I would like to ask the Minister to give me some reassurance on five specific points. First, will he use his good offices to persuade Staffordshire police to apologise, at long last, to my constituent and his parents, if for no other reason than for withholding the prescribed medication, for which I can see no justification?
Secondly, will the Minister assure me that, in future, all records—not just those from 2002 onwards—will be checked prior to any arrest, so that no other innocent person and their family suffer the trauma and indignity experienced by my constituent and his parents? Thirdly, will the Minister clarify whether he believes it correct that any complaint made before the creation of the IPCC cannot be pursued by it, and will he tell me what, if any, recourse is open to any other complainants in a similar situation?
Fourthly, is the Minister happy that, when a complaint is made either against an officer or, as in this instance, against a police force in general, it is handled in a way that is liable to produce an outcome that leaves the complainant feeling less than reassured? Fifthly, will he send the message today to all police forces that, when a mistake is found to have been made, a swift apology must be forthcoming? This is a dreadful case of sloppy practice leading to an injustice, yet, even now, all my constituent really wants is an apology.
Child pornography is an appalling crime, and those who are guilty rightly face public shame as well as the full force of the law. However, those who have committed no crime and who are wrongly accused also face public anger and horror. The police should therefore behave with the greatest level of professionalism. In this case, that professionalism was sadly lacking. I hope that the Minister will be able to respond to my five points, and that, despite what the force’s solicitors have said, Staffordshire police will make a full apology to my constituent and seek to right this wrong.
The Parliamentary Under-Secretary of State for the Home Department (James Brokenshire)
Let me start by congratulating the hon. Member for Stoke-on-Trent South (Robert Flello) on securing this debate and on bringing this important matter to the attention of the House. I certainly understand his desire to highlight the specific case of his constituent, and he has clearly followed up with great care the various issues that have been raised with him. I hope he will recognise that it is difficult for me to respond specifically on an individual case of this nature. I also hope, however, that he will appreciate that this provides me with an opportunity to comment on Operation Ore and on a number of steps that the Government are taking to tackle the issue of illegal images online and the wider work of child protection generally. I note the five points that he has highlighted, and I will seek to address some of them in the course of my comments.
It might be helpful if I give the House a brief overview of Operation Ore. As the hon. Gentleman has explained, this was, at the time, an investigation into the activities of individuals on a scale that we had not seen before. In September 1999, the United States Postal Inspection Service searched the premises of an American-based online trading company known as Landslide Inc, which was providing access for payment to adult pornography and child abuse images. Material was seized that included a database containing the list of subscribers.
In September 2001, Landslide Inc transaction information was received by the National Crime Squad, a precursor agency of CEOP—the Child Exploitation and Online Protection Centre. The information was originally received within the National Criminal Intelligence Service, but following an initial assessment it was passed to the National Crime Squad. The NCS took responsibility for national co-ordination in dealing with the dissemination of the subscriber data. This included a co-ordinated approach to the categorisation and prioritisation of individual suspects based on their potential access to children. The transaction data consisted of information submitted by a customer in purchasing access to the websites, which included their name, address, credit card number, e-mail address and a customer-selected password. In April 2004, following the first incitement case, further forensic work revealed the capture of the subscriber IP address and the credit card verification logs.
In the majority of Operation Ore cases, police forces have used the data from Landslide Inc to commence investigations into the suspected possession of indecent images of a child. There is a common misconception about these cases being linked under an overall programme of investigation. I want to make it clear that the decision whether to proceed in each individual case was a matter for the police force concerned, and that once the individual packages were released to the forces, it was the responsibility of individual chief constables to decide whether to undertake investigations. Following investigation, forces considered whether offences had been committed and warranted judicial proceedings. Each case was independently scrutinised by the local Crown Prosecution Service, and in those cases where suspects elected for trial, the evidence was obviously further tested by the courts. To the best of our knowledge, no cases were brought on the basis of credit card data alone.
We understand that about 2,700 individuals have been convicted of these offences. This figure includes more than 700 admitting their guilt in receiving a formal caution. In almost 2,300 cases, child abuse images were discovered. In 22% of all dissemination cases following an investigation, the police service took no further action. Importantly, more than 154 children were safeguarded.
As I have already indicated, it would not be appropriate for me to discuss individual cases in this debate, but I want to be clear that it is my understanding that the investigation process followed by the police in these cases was the same as for any other type of crime, and that following a thorough investigation, decisions were made on whether to proceed with a prosecution, or other action, taking all relevant factors into account.
I appreciate the points made by the hon. Gentleman and recognise the sensitivities for people who are arrested or accused of such crimes. An additional factor that the police have to consider in such cases is whether there is a direct and continuing threat to children from those who have been accused of a crime. It is a matter for the investigating officers, in conjunction with local children’s services, what action they take having considered that question. The hon. Gentleman has highlighted his desire and his constituent’s desire to receive an apology from Staffordshire police. That is a matter for Staffordshire police. The hon. Gentleman has put on the record the chronology of the events, the issues he has and his constituent’s concerns. I am sure that those points will be heard by Staffordshire police as a consequence of this debate.
The police and CEOP have standard guidelines for dealing with these investigations, which include recommendations for handling interviews and arrests. Although it is right that we consider the effect of the accusation on the person who is accused, that needs to be balanced with the risk posed to children. A member of the public who is dissatisfied with the behaviour of individual officers or a force may complain to the relevant police force or to the Independent Police Complaints Commission, to which the hon. Gentleman referred. The IPCC has a dual purpose to act as an overall guardian to the police complaints system, ensuring its effectiveness and efficiency, and also to take a role in individual cases. It is entirely independent of the police and the Government. The hon. Gentleman raised a specific point about the IPCC’s ability to take on individual cases that predate its creation. I hope that it is satisfactory to him if I respond later with further details on that issue.
The broader issue of illegal images is sadly one that persists. I would like to take this opportunity to set out the approach that we will take to that problem. I believe that we all have a responsibility to help to make the internet a safer place for the public. I support the self-regulatory model developed in the UK by the internet industry and law enforcement to provide a structure for the reporting of such images, the analysis of them, and action to track down those responsible or prevent access to them.
I recognise the support for the Internet Watch Foundation and the action taken by responsible internet service providers to prevent inadvertent access by the public to such images. That is an example of how industry and others can make a significant contribution to tackling this problem. I valued the opportunity this afternoon to attend the launch of the IWF’s three-year strategy and the publication of its annual report on its work to take down such images, working closely with law enforcement and other agencies. The Government strongly support this model for tackling illegal images. We believe that it works and we would like to see other countries take action to achieve the same ends.
The work of the IWF and the industry, allied with that of the police and CEOP, has helped virtually to eradicate the content in question from servers hosted in the UK, although there is clearly still work to be done. We will continue to support the work of CEOP, which does so much to help to protect children. It has been a great success, and it has helped to safeguard a significant number of children and apprehend people who would seek to harm them.
I wish to reassure the House of two things. The first is the seriousness with which the Government take the protection of children. In that context, we will continue to support the work of the police and CEOP to protect children from the threats posed to them. Like the hon. Gentleman, I thank them and congratulate them on their work to ensure that children are safer. Secondly, we will ensure that should an operation on the scale of Operation Ore be required again, the UK has in place a robust structure to deal with it. We will ensure that cases are handled in accordance with the law.
I thank the hon. Gentleman for raising this important issue in general, and equally for raising the case of his individual constituent. He has made his points very clearly, and he has certainly followed the case through for his constituent. I am sure that hon. Members who are in the House this evening, and people outside, will have heard the points he has raised tonight and will take notice of them.
Question put and agreed to.
Ministerial Correction
(13 years, 1 month ago)
Ministerial CorrectionsRead Full debate Read Hansard Text
Departmental Expenditure
(13 years, 1 month ago)
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Stephen Barclay
To ask the Secretary of State for Culture, Olympics, Media and Sport what expenditure (a) his Department and (b) each public body sponsored by his Department incurred on engaging external audit services in each of the last three years; and to which service providers such payments were made in each year.
[Official Report, 8 March 2011, Vol. 524, c. 924-926W.]
Letter of correction from Mr John Penrose:
An error has been identified in the written answer given to the hon. Member for North East Cambridgeshire (Stephen Barclay) on 8 March 2011. The incorrect auditor was listed for the Horserace Betting Levy Board. The auditor was Grant Thornton UK LLP, not the National Audit Office.
The correct answer should have been:
John Penrose
The Department for Culture, Media and Sport is audited by the National Audit Office (NAO). The NAO charge notional fees for the audit of central Government Departments and Executive Agencies. There is therefore no expenditure for the external audit of the Department’s Resource Accounts and The Royal Parks Accounts.
The Secretary of State for Culture, Olympics, Media and Sport has management and control responsibilities for the National Lottery Distribution Fund (NLDF) and the Olympic Lottery Distribution Fund (OLDF). Both funds are audited by the NAO and charged a hard fee in cash as set out in the following table.
Body | Auditor | 2009-10 | 2008-09 | 2007-08 |
|---|---|---|---|---|
Department For Culture, Media and Sport (NLDF) | National Audit Office | 26,500 | 28,900 | 24,000 |
Department For Culture, Media and Sport (OLDF) | National Audit Office | 26,500 | 28,900 | 24,000 |
Most of the Department’s arm’s length bodies are audited by the NAO and are charged a hard fee in cash. The two bodies audited by private firms are companies as well as being charities, and have not been designated for audit by the Comptroller and Auditor General under the Government Resources and Accounts Act 2000.
The following table sets out the bodies, their auditors and the fees charged as disclosed in the bodies’ annual reports and accounts.
Body | Auditor | 2009-10 | 2008-09 | 2007-08 |
|---|---|---|---|---|
Arts Council England1 | National Audit Office | 68,000 | 75,000 | 60,000 |
Arts Council England Lottery Account | National Audit Office | 62,000 | 71,000 | 61,000 |
Big Lottery Fund | National Audit Office | 106,000 | 105,000 | 110,000 |
British Library | National Audit Office | 53,000 | 52,000 | 50,000 |
British Museum | National Audit Office | 59,000 | 50,000 | 47,000 |
Commission for Architecture and the Built Environment | National Audit Office | 28,000 | 27,000 | 26,090 |
English Heritage | National Audit Office | 74,000 | 69,000 | 61,000 |
Football Licensing Authority | National Audit Office | 8,900 | 6,900 | 6,200 |
Gambling Commission | National Audit Office | 39,000 | 47,000 | 33,000 |
Geffrye Museum | National Audit Office | 9,000 | 7,500 | 6,400 |
Horniman Museum | BDO Stoy Hayward LLP | 13,100 | 13,825 | 12,450 |
Horserace Betting Levy Board | Grant Thornton UK LLP | 45,000 | 38,000 | 35,000 |
Imperial War Museum | National Audit Office | 41,000 | 36,000 | 34,000 |
Museums, Libraries and Archives Council | National Audit Office | 63,000 | 93,000 | 58,000 |
Museum of Science and Industry in Manchester | Beever and Struthers | 9,500 | 9,500 | 11,410 |
National Gallery | National Audit Office | 40,000 | 38,650 | 37,165 |
National Heritage Memorial Fund (NHMF)1 | National Audit Office | 10,000 | 9,000 | 8,000 |
Heritage Lottery Fund (maintained by NHMF) | National Audit Office | 42,000 | 42,000 | 36,000 |
National Lottery Commission | National Audit Office | 25,000 | 24,000 | 22,000 |
National Museums Liverpool | National Audit Office | 54,000 | 50,000 | 45,000 |
National Maritime Museum | National Audit Office | 36,000 | 35,000 | 33,000 |
National Museum of Science and Industry | National Audit Office | 92,000 | 92,000 | 87,000 |
National Portrait Gallery | National Audit Office | 35,000 | 32,000 | 31,000 |
Natural History Museum | National Audit Office | 49,000 | 51,000 | 46,000 |
Olympic Delivery Authority | National Audit Office | 238,000 | 212,000 | 158,000 |
Olympic Lottery Distributor | National Audit Office | 13,000 | 13,000 | 12,000 |
Public Lending Right Central Fund Account | National Audit Office | 18,000 | 17,500 | 17,000 |
Royal Armouries | National Audit Office | 36,000 | 36,000 | 41,000 |
Sir John Soane’s Museum | National Audit Office | 14,000 | 14,000 | 8,250 |
Sport England | National Audit Office | 102,000 | 80,000 | 76,000 |
Sport England Lottery Distribution Fund | National Audit Office | 55,000 | 52,000 | 47,500 |
Tate | National Audit Office | 49,000 | 42,000 | 40,000 |
UKAnti-Doping2 | National Audit Office | 17,000 | n/a | n/a |
UK Film Council1 | National Audit Office | 33,000 | 33,000 | 21,000 |
UK Film Council Lottery Distribution Fund | National Audit Office | 24,000 | 24,000 | 20,000 |
UK Sport1 | National Audit Office | 45,000 | 45,000 | 33,000 |
UK Sport Lottery Distribution Account | National Audit Office | 28,000 | 28,000 | 26,000 |
Victoria and Albert Museum | National Audit Office | 45,000 | 45,000 | 37,000 |
VisitBritain | National Audit Office | 57,000 | 55,000 | 52,000 |
Wallace Collection | National Audit Office | 23,000 | 22,000 | 22,000 |
1 Under the National Lottery etc Act 1993, Arts Council England, CE, NHMF, Sport England, UK Film Council and UK Sport are required to produce separate Lottery Distribution accounts. These are audited separately and shown as separate lines from the parent body’s accounts. 2 UK Anti-Doping has only been in independent operation since 2009-10. Note: The Big Lottery Fund is a Lottery body but has its Lottery income consolidated with its other figures. |
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Branfil Primary School (Upminster)
Westminster Hall
Westminster Hall is an alternative Chamber for MPs to hold debates, named after the adjoining Westminster Hall.
Each debate is chaired by an MP from the Panel of Chairs, rather than the Speaker or Deputy Speaker. A Government Minister will give the final speech, and no votes may be called on the debate topic.
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Quilliam Foundation
(13 years, 1 month ago)
Westminster HallRead Full debate Read Hansard Text Read Debate Ministerial Extracts
Westminster Hall is an alternative Chamber for MPs to hold debates, named after the adjoining Westminster Hall.
Each debate is chaired by an MP from the Panel of Chairs, rather than the Speaker or Deputy Speaker. A Government Minister will give the final speech, and no votes may be called on the debate topic.
This information is provided by Parallel Parliament and does not comprise part of the offical record
Paul Goggins (Wythenshawe and Sale East) (Lab)
You will realise from my dulcet tones, Mr Dobbin, that I am struggling with my voice this morning, but I hope at least to get to the end of my introductory remarks. It is good to see you in the Chair. This morning’s debate takes us to the heart of an important issue in which I know you are interested, as are many hon. Members on both sides of the House. I am pleased that so many from both sides are already present, and am particularly pleased to be joined by my right hon. Friend the Member for Salford and Eccles (Hazel Blears). She speaks on these issues with considerable experience, as a former Minister with responsibility for police and counter-terrorism and a former Secretary of State for Communities and Local Government. She learned a great deal in both those roles and I look forward to hearing her comments later.
This debate takes us to the heart of a complex and crucial issue, namely, the need to take on the extremist ideology that underpins the activities of those who are opposed to our society and seek to destroy it. I want to keep my remarks and the debate simple, because what is at stake right now is the future of an organisation that is playing a vital role within that debate. My straightforward request, which I seek to put as constructively as I can to the Minister, is that transitional funding of £150,000 be made available to the Quilliam organisation, which will fold in the next few days unless interim support is made available. Although I realise that a debate in Parliament is not the time for line-by-line negotiation of every aspect of an organisation’s budget, I hope that, by the debate’s conclusion, the Minister will have given us cause to hope that a resolution will be found to the problem and a way forward established.
Five weeks ago, the Prime Minister made an important speech at the Munich security conference. He argued that we need to differentiate between Islam—the world religion that teaches and practises a belief in peace and a loving God—and Islamist extremism, a political ideology which is opposed to western democracy and is linked to and underpins terrorist violence. He explained that radicalisation is a process that turns non-violent Islamists into people who are prepared to kill human beings, including themselves, in pursuit of their perverted ideology. The Prime Minister pointed out that vulnerable individuals become terrorists not overnight, but as a result of the constant pressure placed on them, whether in internet chat rooms, in prisons or, indeed, on university campuses. He went on to state that we need to work with Muslim-led organisations that are willing to confront that Islamist ideology, provided that, at the same time, they defend human rights, equality and integration. He said:
“So let us give voice to those followers of Islam in our own countries—the vast, often unheard majority—who despise the extremists and their worldview. Let us engage groups that share our aspirations.”
I agree very firmly with what the Prime Minister said.
Quilliam is a secular think-tank that was set up in 2008 by two former Islamist extremists, Ed Husain and Maajid Nawaz. Since then, it has become a unique centre of knowledge of such extremism. It is not an exaggeration to say that its research and networking have had at least as great an influence on the debate about Islamist extremism and terrorism as any other organisation in the UK. It has gained an international reputation for its work. It is interesting that, this very morning, an important conference on counter-terrorism will be addressed by the Minister for Security, Baroness Neville-Jones. Further down the agenda, a senior spokesperson from Quilliam will speak about the same issues and agenda as a senior Government Minister.
Controversy is, predictably enough, never far away from such an organisation. It has made enemies as well as friends. Those associated with Quilliam face considerable threats and abuse as a result of the stance that they take. Quilliam was initially funded by money from private donors in the Gulf. However, that money was withdrawn when Quilliam’s founders publicly criticised Yusuf al-Qaradawi and the use of suicide bombings against Israeli civilians. After that, Quilliam began to receive money from the Home Office and the Foreign Office under the Prevent programme. Quilliam always intended to become financially self-sufficient and was close to achieving private funding on two occasions, only to lose it at the last minute—first, as a result of the credit crunch, and secondly, because of the 2009 uprisings in the middle east.
The money given to Quilliam by the Government has had an immediate and visible impact. Quilliam is one of the few Muslim-led organisations willing to confront extremism directly, to name and shame extremist organisations, and to remain unequivocal in its defence of British values, including free speech, freedom of religion, gay rights and respect for others.
Quilliam has been the most vocal Muslim-led organisation to condemn, without equivocation, suicide bombings and acts of terrorism, and to challenge extremist groups in the United Kingdom. Its bold approach has paved the way for other Muslim groups throughout the United Kingdom to follow suit. By acting as a leader within Britain’s Muslim communities, Quilliam has encouraged other Muslim groups to initiate real debates about issues such as terrorism, religious belief and secularism.
A few days ago, for example, Quilliam issued a statement publicly defending Usama Hasan—a progressive London imam who received death threats for stating his belief in evolution—and criticising the total silence of the Muslim community in the face of the threats against him. The statement encouraged more than a dozen major British Muslim organisations to issue their own statements defending Hasan and his right to free speech.
Quilliam’s staff and supporters make regular media contributions to mainstream UK programmes as well as to specialist Islamic TV and radio outlets. Their statements demonstrate clearly that not all Muslims are extremists. They also challenge Islamist extremists within their own core constituency. In my experience, no other Muslim-led group in the UK does that more effectively.
As the middle east and Pakistan face ever greater turmoil, I believe that Quilliam can make an important contribution, both to our understanding of what is happening and the forces at work, and to the development of a narrative that counters the extremists. Quilliam can also help to challenge Islamist extremism here in the United Kingdom. It has already done much to influence the debate and get the message across to the British public that the vast majority of Muslims are also against extremism. There is particularly important work to do in that regard with young Muslims, who may be disillusioned, concerned about, and fed up with the world around them, and who may be attracted by the perverted ideology of the extremists. We have to make sure that that is countered, and organisations such as Quilliam are in an ideal position to do that.
Mike Gapes (Ilford South) (Lab/Co-op)
I have known for some time some of the people involved in Quilliam. My right hon. Friend has mentioned Pakistan, and one of the things that I have found valuable is a report published by Quilliam about a year ago about the radicalisation going on in Pakistan. The organisation was prepared to go to Pakistan and engage with young people in its universities, and to explain to them the realities of British Muslim life. Very few other organisations in this country are prepared to do that, and to do it without a destructive political agenda that feeds prejudices. Quilliam was challenging prejudices, which is in our national interest. It is, therefore, vital that we continue supporting Quilliam.
Paul Goggins
I am grateful for my hon. Friend’s intervention. He is a great authority on the issues and has an association with Quilliam—as he has said, he knows some of the people involved. He has raised an important issue. In fact, Quilliam has been involved in establishing a Facebook site called Khudi, which has 40,000 subscribers in Pakistan. There are young people listening to the liberal values and arguments being made through that Facebook page. Quilliam is taking the argument into parts of the world where we would find it impossible as individual politicians or, indeed, Governments to advance arguments that would be listened to with any credibility. I pay tribute to Quilliam for doing that work and thank my hon. Friend again for his intervention.
We will soon learn the conclusions that the coroner has reached in the 7/7 inquest. Whatever findings and recommendations she makes, we cannot escape the fact that those responsible for the bombs were a part of our community. We must ensure that there is no room for retreat into denial about extremism. Like my right hon. Friend the Member for Salford and Eccles, I was a Home Office Minister when the 7/7 bombs went off. In the months that followed, she and I travelled the length and breadth of the country in a effort to engage with the Muslim community and encourage it to face up to the minority in its midst that had adopted an extremist ideology and was intent on the destruction of our way of life and the values that underpin it.
I learned a great deal from those many encounters, but the most important lesson I learned was that it would not be me who could persuade young Muslims away from those who would try to radicalise them and turn them into extremists; it must be people within the wider Muslim community itself who do that work. Our job—whether as Ministers, other politicians who are interested in the issue or, indeed, non-governmental organisations—is to empower and encourage people within the Muslim community to do such work for themselves. That was the most important lesson I learned.
Patrick Mercer (Newark) (Con)
Like me, I am sure that the right hon. Gentleman remembers sparring over this issue in relation to the Prevent strategy and the rights and wrongs thereof. However, the Quilliam Foundation is based on not just common sense, but the historical precedent of using those who were opposed to spread the message back to our opponents. That is a very valuable tool; it is not unique but it is an extraordinary tool. I am sure that the right hon. Gentleman would agree that that must not be allowed to perish.
Paul Goggins
I am grateful for the hon. Gentleman’s intervention. He and I have sparred over many issues, including this one. I have a great measure of agreement with him when we debate such matters. Those who speak with not just knowledge, but experience do so with additional credibility and in a particularly powerful way. We cannot afford to lose the experience that is contained within the Quilliam Foundation. I hope that my remarks and arguments—and those that will be made by others later in the debate—will persuade Ministers not to give a blank cheque to the organisation, but to provide sufficient funding to enable it to survive the immediate future and provide its own sustainable funding in the long term.
I was describing the core of the important work that Quilliam does by supporting, encouraging and empowering those within the Muslim community to take this work forward for themselves. Again, I say that I am not asking for a blank cheque. Indeed, I support the strong argument that Quilliam should get out of Government funding in the longer term because that will add to its sense of independence, credibility and power within the Muslim community. In the long run, that is a sensible way forward, but we need an interim solution that will enable the organisation to survive these next few days and weeks.
Quilliam has not simply sat there and demanded money; it has taken difficult decisions in recent days to make its sustainability more likely. It has reduced staff numbers from 14 to six and has made eight staff redundant. Clearly, those are very painful decisions, but Quilliam regarded them as necessary in the circumstances. The small team that remains at Quilliam is working flat out on funding bids to charitable trusts and other funding organisations. It currently has a number of funding bids in but, as hon. Members know, charitable trusts do not deal with funding bids every day of the week; they have their own cycle and programme for deciding such things. Quilliam needs some time to allow those organisations to consider the bids and to respond, I hope, positively. Another important recent development has been the granting of charitable status to Quilliam in the United States. I hope that that will open up more avenues of potential financial support for it in the longer term.
I would also like to inform the Minister that Quilliam has actively been looking for smaller more affordable offices, which is also an important way of reducing the organisation’s overhead costs. Quilliam is not sitting there expecting a blank cheque from Government; it wants independent funding and it is prepared to reduce its costs. However, at the moment, it faces a real crisis. The request is simple enough. In December, Quilliam was told that there would be no more core funding in 2011-12. Three months is just not long enough for an organisation to move from core funding to project funding. We need a more flexible approach. A grant of £150,000 to cover the year ahead should be made. That is a reasonable investment in the kind of project I have been describing. After that, Government funds should be available only for specific projects that are agreed.
I hope that such an approach will find support from all parties this morning. It is certainly supported by Lord Carlile who, of course, is regarded by many as the expert in this area of public policy. He has made it clear in the media and personally to me that he supports having a transitional grant that would facilitate survival and then a path towards sustainable, independent funding. Quilliam is prepared to confront Islamist extremists. We should be prepared to ensure that it remains in business.
Tom Brake (Carshalton and Wallington) (LD)
I congratulate the right hon. Member for Wythenshawe and Sale East (Paul Goggins), who has put forward a strong and effective case. He has made a very specific proposal that £150,000 should be provided by the Government. He made it clear that it should not be a blank cheque and specified that the funding would be for 12 months starting next month. What he did not do was to set out precisely what conditions and objectives might be attached, perhaps because he cannot conduct negotiations on Quilliam’s behalf, or he does not want to conduct negotiations here. He indicated clearly that at the end of the 12-month period, Quilliam would have to be self-financing, albeit perhaps having secured grants from Government for specific projects. However, other conditions might have to be attached if the Government were minded to go down that route.
The right hon. Gentleman made it clear that today’s discussion on the future funding of Quilliam is not just about the funding streams of that UK-based think-tank; it is about the Government’s current and developing policy stance on counter-terrorism—what we fund and why and how we should continue to move forward post-Prevent. Is our nation’s security to be based on ideology and on which groups emphasise or downplay certain aspects of Islam, or on reality and on the evidence of policies that have worked and continue to produce results?
As the right hon. Gentleman said, Quilliam’s funding streams are well documented and a loss of substantial funding early in its inception led to its being funded by the Foreign and Commonwealth Office and the Home Office, which illustrates exactly why there is a need for Quilliam to continue. It lost funding by being vocal in opposing extremism in whatever form and from whatever source. As he said, a funder withdrew support early on in Quilliam’s life as a reaction to the organisation’s stance against suicide bombings in Israel. Quilliam’s public stance on that issue was not particularly to do with Islam, but it was part of its consistent, clear and vocal opposition to all forms of terrorism. However, the resultant situation—Quilliam being funded largely by two Departments—clearly raises issues about bipartisanship and credibility.
Quilliam is not the only organisation that publicly and vociferously challenges extremism in all its guises, whether anti-Jewish, anti-Islam or anti-western; nor is it the only organisation in which former extremists have played an active part in educating peoples, Governments and policy makers on how to recognise and counter the type of radicalisation that results in extremist behaviours. The Street project in Brixton was previously funded by Prevent and has also experienced funding cuts. It is a non-sectarian group that works from a mosque and does measurable work in combating the kind of radicalisation that can lead to extremism. Similarly, the Cordoba Foundation has produced projects with a focus on preventing radicalism from becoming extremist action. In about a week’s time, an initiative called “Learning to be a Peacemaker” will be held in this place by an organisation called Initiatives of Change, which is also working in that field.
It is true, however, that Quilliam is distinct and unique in important respects. It is the only organisation that challenges extremist views and activities by effectively straddling both the Muslim perspective and the liberal, secular, mainstream vernacular of modern Britain. It represents the swathes of British Muslims who are Muslim by birth and culture first and foremost, but who understand and adhere to the division between Church and state, which is second nature to mainland Britain. Quilliam sits within the diverse and, at times, conflicting dialogue about Islam that is both acceptable and normal practice among faith-based Muslim groups, but unlike any other organisation of its size and impact, Quilliam also sits comfortably within the traditional western liberal dialogue, which separates to a large extent the personal faith of individuals and the secular, cultural interpretation of those personal faiths.
As the right hon. Member for Wythenshawe and Sale East set out, Quilliam started life as a think-tank, but the very nature of its work—outreach in universities, and research and policy advice—is much more akin to that of an effective and proactive non-governmental organisation. Quilliam’s vocal stance against terrorism that claims to be inspired by Islam has had solid results, which are measurable. Accurately signposting Government to specific individuals with an inclination for extremist action is invaluable in our fight against terrorism. As the right hon. Gentleman said, it remains one of the few groups—occasionally the only group—that consistently challenge and publicly condemn terrorism, from whatever source. As it sits within the Muslim dialogue, it has first-hand access to, and shared understanding of, the dialogues taking place at grassroots level and online that can lead to extremist action. That position is unique and invaluable to the Government’s fight against terrorism.
However, the criticism levelled at Quilliam, and indirectly at the previous Government for funding the group, is worth examination and raises important questions that need to be addressed in relation to any decisions about funding. The first is about its perceived dominance of the mainstream view. Many individuals and organisations are discouraged by an organisation that purports to be the arbiter of what is, or is not, mainstream. That is further complicated by the coming to light of a list produced by Quilliam that seems to many to suggest that some other Muslim organisations, which consider themselves mainstream, are breeding grounds for civil unrest because of ideological perspectives shared to a greater or lesser extent with radical extremist groups.
Dr Julian Lewis (New Forest East) (Con)
The hon. Gentleman makes a serious point. However, is it not the case that when taking part in an ideological battle, all groups describe themselves as mainstream? Indeed, even Islamist extremists describe themselves as mainstream, because they are trying to say that everyone who disagrees with them is an apostate. There is nothing unusual, therefore, about Quilliam at one end of the spectrum calling itself mainstream, while other groups at the centre of the spectrum call themselves mainstream, and groups on the radical Islamist end of the spectrum call themselves mainstream. That is not really a valid criticism.
Tom Brake
The hon. Gentleman is very experienced in these matters. Maybe on that particular point we will have to disagree on whether my comment is appropriate.
The funding of a think-tank by the Home Office and the Foreign and Commonwealth Office will inevitably contribute to a perceived lack of plurality of voices heard by Government on how best to combat extremism. Lack of funding from other agencies will raise questions about how and whether Quilliam can critically engage with Government, and will cast doubts about its credibility as an independent body with the capacity to critique Government plans and policy on tackling radical extremism. It is true to say, however, that that position conveniently forgets the numerous groups that receive funding from the Government’s Prevent strategy to undertake or continue work to counteract extremist activity. It also overlooks the many Muslim groups that are frequently invited to put their views to Government, most recently a couple of months ago at a conference I hosted here with Murtaza Shibli, when we invited Muslim organisations to share opinions and advice on how best the Government can go forward with the post-Prevent agenda.
No one can doubt the achievements of Quilliam as an NGO. The debate about funding should, therefore, rightly concern itself with levels of funding at a time of financial austerity, and not about whether we should forgo that important insight into extremist narratives. Although I support the continued funding of this much-needed organisation, Quilliam, like other NGOs and agencies working under the vital remit of social cohesion, needs to look hard at how best to make effective decisions within tighter financial constraints. Quilliam also needs to continue to pursue other avenues of funding—as it is doing—to continue, with credibility, a bipartisan relationship with Government and other Muslim groups.
Hazel Blears (Salford and Eccles) (Lab)
It is a great pleasure to contribute to the debate. I congratulate my right hon. Friend the Member for Wythenshawe and Sale East (Paul Goggins) not only on securing the debate, but on his thoughtful, wide-ranging and incisive contribution. It is also a pleasure to follow the hon. Member for Carshalton and Wallington (Tom Brake), who clearly has experience in these matters. He has raised some important issues, particularly on the plurality of voices, which we need as a society, on what are always contentious and very often sensitive matters. This debate is an opportunity not just to recognise the work that Quilliam has done, but to explore some of the complexity of this area and how Government might go forward.
We are here to highlight the situation in which Quilliam finds itself. I intend to concentrate on that in my remarks, because we need to press the Government for results as much as we need to have a general debate. In my experience, as with a number of groups working on this agenda, Quilliam has very often been brave, courageous, and willing to tread where other people have not perhaps been quite so brave. It always wants not just to highlight the threat that our country faces, but to come up with a practical response about how we can tackle that threat and develop a counter-extremist narrative and agenda to ensure that we build the resilience, particularly of our young people, to withstand extremist messages.
We are at a very important moment in relation to this issue. We had a significant speech from the Prime Minister a couple of weeks ago at the Munich security conference, which marks something of a turning point. He was very firm that the Government cannot tackle these issues alone. Government need help from a wide range of organisations from civil society, the Muslim community and communities across the spectrum. Government can do certain things, but the power to tackle an extremist narrative always comes from the community itself, which has to feel empowered, supported and backed up by Government in order to take on that task. The Prime Minister said:
“governments cannot do this alone. The extremism we face is a distortion of Islam”.
That is absolutely right. Islam is about peace, compassion, tolerance and inclusion; it is not about violence and division. The people who peddle messages of hate actually harm Islam in a way that almost nothing else can. The Prime Minister continued:
“these arguments, in part, must be made by those within Islam…let us give voice to those followers of Islam in our own countries—the vast, often unheard majority—who despise the extremists and their worldview.”
If that is our task, and we need others to help us, then it is very sad that we find ourselves having to press almost for the survival of an organisation such as Quilliam. It is that serious. Unless practical steps are taken by Government to ensure that there is some transitional funding for that organisation, I have no doubt that it will simply fold and not be able to conduct its activities. It has already made significant redundancies of a whole range of staff. From experience, I know how difficult it is to create capacity on these very difficult issues. It takes experience, knowledge and—I come back to that word—courage to stand up and be counted, and very often to make enemies, and face personal threats and intimidation. If we lose that organisation, we will lose that enormously valuable capacity that may well be able to be built up in the future. If something is destroyed, however, it is much harder to build up.
Mr Gerry Sutcliffe (Bradford South) (Lab)
As an experienced former Government Minister, my right hon. Friend will know that Departments sometimes have the capacity, when they are reviewing programmes and trying to look at the whole picture, to let things slip through the net. Is there a danger that Quilliam could slip through the net?
Hazel Blears
I am grateful to my hon. Friend for that intervention. The debate this morning is an attempt to ensure that Quilliam does not slip through the net, and I know that Ministers in the Department are seized of the issues. We all recognise that these are difficult financial times and that difficult decisions have to be made across the Government, and I want to explore that a little with the Minister, perhaps with some specific questions later. We recognise that these are not easy times. The Home Office, which has taken a significant reduction in its expenditure, clearly needs to economise. My right hon. Friend the Member for Wythenshawe and Sale East has set out a specific proposition for £150,000 of transitional funding to enable Quilliam to pursue the other applications that it has made, which ought to get us to a reasonable position. I recognise that having an organisation solely dependent on public funds is not tenable in the long term.
Tom Brake
The right hon. Lady has been familiar with the organisation for several years. Is she aware of whether Quilliam was previously given an indication that it should go to other organisations to find funding? If it was but has not been successful in achieving self-sufficiency, the Government would have strong reservations about putting money in again.
Hazel Blears
This did not become a significant issue until we were facing the current financial circumstances which pertain across Government. I certainly was not aware of a major drive, which was unsuccessful, to press Quilliam to find funds in other sectors. Clearly, the situation now is that economies need to be made. Quilliam has been put into that pot, but I want to explore with the Minister what other organisations are funded and what cuts have been made—I shall come shortly to the Research Information and Communications Unit. We need a better, broader picture of the total resources available, and what decisions have been made about funding priorities. In a few weeks, we are expecting the Prevent review, which will give us more insight into what the balance of organisations ought to be. We absolutely need a balance.
This is not a partisan issue by any measure—it transcends party politics. It relates to the security and safety of our country, and nothing can be more important than that. My right hon. and hon. Friends and I are pursuing the matter to try to get a reasonable settlement.
As my right hon. Friend the Member for Wythenshawe and Sale East said, I was the Minister with responsibility for counter-terrorism at the time of the 7 July 2005 bombings. Even now, I can feel the sense of devastation and shock that there was across the nation when that happened. People were asking who committed the bombings, why they would want to do that to innocent men and women and their families, and what led them to be prepared to take their own life to fulfil what they presumably believed to be their mission and destiny. I do not think that any of us really understood—we still do not—the many and varied factors that lead people down such a path, that lead them even to contemplate taking such steps.
We are better informed than we were then. Several organisations that have been active in this field have helped the Government and policy makers to come to a better analysis of the factors that lead people to extremism, but we do not have all the answers. I entirely accept that, although some of the measures in the Prevent programme were successful, some were less successful, but what we were doing in that area was innovative and, in many ways, experimental.
I have spoken to people in the United States, France, Germany and countries across western Europe who say that this country has been at the forefront of trying to drill down to determine what the factors of extremism are, and how to build resilience among young people so that they can resist such messages. My sense is that those other countries are just beginning to take the first steps. Indeed, that was reaffirmed for my right hon. Friend and me when we went to the United States just last week. Many of the Congressmen and women and Senators acknowledged that they are very much at the beginning of thinking about a counter-radicalisation strategy, whereas this country is well ahead. This country’s position has been aided enormously by the different groups that we have funded to help us. They have had programmes and have been able to develop an evidence base about the best way to counter extremism, and the Quilliam Foundation has been at the heart of that process for the past three years at least.
As everyone knows, Quilliam was formed by Ed Husain and Maajid Nawaz, both of whom had been in the grip of extremists. They had been right at the heart of Hizb ut-Tahrir and knew what it felt like to travel down that path. Therefore, their voices and the voices of others at Quilliam who have been able to set out the emotional process that happens to people on that journey have been enormously powerful and valuable in working out strategies to counter extremism. They were certainly instrumental, when I was the Secretary of State for Communities and Local Government, in my decision to set up the Young Muslims Advisory Group and the Muslim Women’s Advisory Group.
It was the first time in this country that we had people at national level who were able to advise Ministers about what it felt like to be a young person in the community with strong feelings about foreign policy and contentious issues, and with the many pressures that face them at that time of their life. What could the Government do to try to help them to grow up with a sense of this country’s values but also, of course, their important personal identity and heritage? The Muslim Women’s Advisory Group was a fabulous opportunity to find out about women’s lives, and how women could influence the young men in their families to withstand the extremist narrative. We can celebrate the huge amount that we achieved, but, obviously, we have much more to do.
Going around the country after 7/7 with my right hon. Friend the Member for Wythenshawe and Sale East was probably one of the most testing experiences I personally have ever undergone. The sense of anger, bewilderment and shock in communities was palpable, but the message that came across to me time and again was that the overwhelming majority of people in the Muslim community totally rejected the violence that had taken place, and believed that killing innocent people was never justifiable. Unfortunately, the extremism that leads people to contemplate and sometimes adopt violence is with us now—there is no getting away from that—and is likely to be with us for many years to come. Life has changed, and we ought to recognise that the circumstances are very different. That is why it is so important that we have the capacity to tackle that ideology and the way in which people seek to groom others to take the path of violence.
I want to mention a report which I think is relevant to this debate. “Fear and HOPE”, which was published last week by the Searchlight Educational Trust, is about the new politics of identity. Many people who are susceptible to extremist narratives are struggling with their sense of identity: who am I, where do I fit in, where do I belong, what is my value set?
The report, which was based on 5,000 interviews of people across the country who were asked more than 90 questions, provides some fascinating results and evidence. What gives me optimism and hope is that there is widespread rejection of political violence. It is interesting that the vast majority of people who were questioned considered white anti-Muslim extremists to be as bad as Islamist extremists. That tells me that a core part of our communities and population are basically saying, “A plague on both your houses. We want no part of extremism, whether far-right extremism, Islamist extremism or anti-Semitism—we reject all that.”
It gives me great hope for the future that if we can build, sustain and make that heart of our community strong, it will empower and give confidence to young people to say, “I reject the extremist narrative. I reject such ideologies and share the broad values of this country.” That prize is so precious and valuable that the investment of £150,000 to enable Quilliam to move to other sources of funding over the next few months is a small price to pay, considering the scale of the challenge that we face. I absolutely agree with the hon. Member for Carshalton and Wallington that we need a broad range of organisations to help with the agenda at every part of the spectrum. It is without doubt that Quilliam has been prepared to be at one end of that spectrum, to speak out, not to be intimidated, and to state the case for pluralism, inclusion and British values of democracy, tolerance, free speech, and particularly the rights of women. It has been extremely effective in doing that.
Obviously, we must support other organisations, and I will come to that, but it is only three years since Quilliam was established, and to have gained its reputation in the world within that period marks it out as a special organisation that has helped us to build that evidence base. Its report on radicalisation on campuses was extremely good and contained a series of recommendations. We know that there is a problem on some of our university campuses, and the report’s practical recommendations could help us significantly. It produced a report on the use of the internet to promote Jihad. We are now seeing preachers such as al-Maliki on the internet urging people to take matters into their own hands without having a group around them, and to carry out individual acts of terrorism. That report on the use of the internet was a good piece of work. The role of television in influencing young minds is crucial.
Quilliam has produced excellent reports, and done project work—for example, its work in Pakistan, as my right hon. Friend the Member for Wythenshawe and Sale East mentioned, which was funded by the Foreign Office, with road shows prepared in challenging and sometimes intimidating circumstances to make the case fearlessly. It has a tremendous record. It is seeking other sources of funding. It recognises that the current situation cannot continue ad infinitum, but it must be given the chance to do that work.
I have some questions for the Minister, and if he cannot answer them during the debate, I would appreciate it if he got back to me later. The Research Information and Communications Unit was established in the Office of Security and Counter-terrorism in the Home Office three or four years ago. My recollection is that that was a fairly well resourced unit. It received contributions from the Department for Communities and Local Government, the Home Office, and the Foreign and Commonwealth Office, and it brought together a series of people with the skills to develop a counter-narrative, to publish documents, and to do research and much of the work that Quilliam has been doing.
Dr Julian Lewis
I remember a conversation I had with a senior Minister about the setting-up of RICU. My understanding is that there was an analogy between it and the operation set up at the onset of the cold war to try to counter communist subversion and propaganda. Either such organisations do the work themselves, or they do the research and support other non-governmental organisations that will go on to the front line and fight the ideological battle. I do not think I have seen anything to suggest that RICU is fighting that battle under its own banner on the front line. If it is not doing that itself, why is it not perpetually committed to the support of other organisations such as Quilliam which are prepared to go into the front line?
Hazel Blears
The hon. Gentleman makes an excellent point, to which I hope the Minister will respond. The comparison between the funding of RICU and the funding that we are asking for in this debate would be illuminating. It is clear that there is a straightforward and simple al-Qaeda narrative, which is that the west is at war with Islam with a feeling of victimhood and grievance. That must be countered, and it is my understanding that that was a core part of RICU’s responsibilities. I would be grateful if the Minister let us know what its resources are, what the product is, what it has been working on and, indeed, whether it can fund other organisations.
Mr Mark Field (Cities of London and Westminster) (Con)
The right hon. Lady is making an important speech, and I entirely agree with the broad thrust of what she is saying about Quilliam’s importance. Will she go into a little detail about the discussion she might have had with that organisation about where it sees its diverse sources of funding coming from if it does not come simply from the Home Office, and a time frame for when new sources would come into play if the Home Office were able to continue some of the funding that it is planning to take away?
Hazel Blears
I am grateful for that question. Until recently, Quilliam was in a position to become self-financing in a short time. It had offers of funding, but we then had the recession, which has unfortunately affected all of us, including charitable donations. We have also had the events in the middle east. I understand that some support was pledged from organisations with middle east connections, but that has not been possible because of recent events. It now has a number of applications with charitable foundations that are active in building capacity, resilience and counter-narratives. It has some applications with individuals who have a long track record of support in this area. It is optimistic about being able to obtain funding. It may not be at the same level as in the past, which is why it has made some redundancies—it wants to cut its cloth according to its resources—but it is optimistic about being able to continue with a core facility and to build from there. That will depend on its reputation and the worth of its product, and rightly so. It should be out there and showing it to people.
I would be grateful if the Minister told us what the RICU budget is, what the overall budget is this year for the Prevent strategy and—I know that there will be a review—what it is likely to be, what other organisations are active in developing the counter-narrative and the counter-extremism part, as opposed to some of the good community work that goes on, and how much funding is provided to external organisations. Much of the Prevent review will be about project funding, and Quilliam absolutely accepts that that is where it needs to be in future. Will the Minster confirm that applications for project funding from the Quilliam Foundation will be considered in exactly the same way as applications from any other body-on the strength of the project that it is putting forward?
We could make decisions on such issues that we may live to regret later. It is so much more difficult to recreate something than to help it to continue to exist. I entirely support my right hon. Friend the Member for Wythenshawe and Sale East in his bid for £150,000 to enable the organisation to have an effective transition. Nothing is more important than keeping our country safe, and I believe that the Quilliam Foundation plays a major role in that objective.
Jim Dobbin (in the Chair)
Order. I intend to call the shadow Minister at 10.40, so that gives hon. Members some idea of how much time we have left for the remaining speakers.
Dr Julian Lewis (New Forest East) (Con)
It is a privilege to follow that outstanding speech by the right hon. Member for Salford and Eccles (Hazel Blears). Her work and that of the right hon. Member for Wythenshawe and Sale East (Paul Goggins) as Ministers on this topic excited the admiration of many of us when we were on the Opposition Benches. It continues to excite my admiration now that they are in opposition, but still fighting just as hard on this vital topic as they ever did when they were Ministers.
During the 1990s, I occasionally had the privilege of taking part in courses on public speaking, oratory and campaigning techniques with another member of the House of Commons who is now Mr Speaker. He always impressed on everyone who came to our courses that when making a speech one should have, at most, two main points, but preferably only one, with which to belabour one’s listeners over and over again, so that if they remembered nothing else about what one had said, they would remember that one point.
Here is my one point today. It is that countering hostile propaganda is not a commercial enterprise or undertaking. It requires sponsorship and support. It is absolute nonsense to say that people who are brave enough to put themselves in the front of an ideological battle should be selling their product on a commercial basis because that somehow means that their organisation is more vibrant.
If organisations that are fighting an ideological battle do not get support from the Government, they will need to get it from private sources. I know of no organisation during the cold war that fought these sorts of ideological campaigns—there were many such organisations; I was involved in several of them—that managed to make enough money to sustain itself as a going concern commercially. Such organisations had to find sponsorship. As I understand it, Quilliam has been rather particular about the sponsors it has sought. It could have taken money from undemocratic regimes but I believe that it turned down those offers. Although it might have agreed with those regimes on certain issues, it could not agree with the way that they rule their countries and peoples. Let us not fool ourselves into thinking that if Government funding is cut from an organisation, that organisation will somehow transform itself into a profit-making enterprise. It will not; that is not its function. The more time that activists in a counter-propaganda organisation spend raising funds, the less time they have available to do the job of countering radicalisation and extremism.
I hope that the Government will have the good sense to continue funding Quilliam because I am a little concerned about what may be going on under the surface. On the surface, as the right hon. Member for Salford and Eccles said at the beginning of her remarks, we have an excellent speech from the Prime Minister stating that we must be tough on radicalism and that we must not compromise. We must not pretend that people who speak with a double voice, as it were, and say that they are against extremism on the one hand but treat it softly on the other, are the only people with whom we should deal. Although that sort of speech makes all the right sounds, in reality Government officials are kicking away the props that support what is undoubtedly one of the most high-profile and successful organisations in the field of counter-propaganda.
I use those words deliberately because this is a propaganda war involving propaganda by those who seek to radicalise, and counter-propaganda by those who seek to defeat and undermine their campaigns. That sort of work must not be undermined by paid Government officials at a time when the head of the Government says that we ought to do more of it.
Something strange is going on and I think I know what it is. Reference was made earlier to the important conference being held today at the Royal United Services Institute. I had hoped to attend that conference this morning, but I felt that this debate was rather more important. My mind went back to a previous conference held quite a few years ago at the RUSI, and a rather impressive Government speaker on counter-terrorism. I subsequently sought a briefing from that speaker, and the Government gave permission for me to have one. During the course of the conversation, I made the point that one clearly had to encourage moderate Muslims to stand up against minority activists, just as in so many other fields. Particularly during the cold war and student radicalism on campuses in other decades, it had been necessary for moderates to stand up for the silent majority against the noisy activist and—above all—unrepresentative minority. I was intrigued by what the expert official said. He replied, “That’s absolutely true: there is a gap between those who hold moderate values and those who hold extreme values. However, there is another gap between those who hold extreme values and those—a much smaller group—who are willing to turn their extreme values and views into extreme and violent action.”
It seems that the Government—perhaps I should say the establishment, as that remains the same when Governments change—have primarily signed up to focusing on the division between extremist people who do not intend to be violent, and extremist people who intend to be violent. There is some value in that approach, but I do not believe that it should be exclusive. If we depend on people in the Muslim community with extreme views to stand up against others from that community with extreme views who want to be violent, we will not get a happy outcome. We must promote moderate values in the Muslim community. Therefore, we need an organisation that is prepared not only to attack violent extremism, but to counter the pernicious ideology of those who might not be planning violence, but who foster an extreme ideological environment where some people will absorb sufficiently illiberal notions and end up turning to violence.
I am concerned about this issue because there are a couple of ways in which counter-propaganda organisations can work. Some such organisations can, and should, concentrate on changing minds. If we wish to try that, it is important to persuade people who are inclined towards fundamentalism that they are wrong, and to have organisations that are perhaps tolerated more happily than Quilliam within the Muslim ideological community. Those organisations can work on trying to change the minds of those who are already radical.
There is, however, another more important element that must not be neglected. We hope, and I genuinely believe, that the majority of people in the Muslim community—I would like to think the overwhelming majority—hold moderate beliefs and are not extremist at all. The problem is that of the three sectors—the moderate community, the extreme community that is not violent and the extreme splinter community that is violent—the Government machine focuses too much on the second two categories, to the exclusion of the first. The only way we will win an ideological battle or war is by mobilising the silent majority. The silent majority is a hackneyed phrase because we use it a lot. Nevertheless, we use it a lot because it is true; it has to be true, and if it were not we might as well give up on civilisation straight away. We need groups that are not necessarily involved in trying to change minds, but rather in trying to reinforce moderate views that already exist.
Dr Lewis
It is not unrealistic and I made that explicit at the beginning of my speech. I said that if one does not get funds from the Government, one must get them from another sponsor. Ideally, one should have a range of funders, and the Government ought to be a part of that. My point is that if the Government have any sense, they will not withdraw funding in such a way that an organisation will collapse. If they believe that the organisation’s work is of sufficient value, they should ensure that it has secure funding before they begin to draw down their own funding stream. It is as simple as that.
I will conclude with one further point. It is my second point and I do not mind if hon. Members do not remember it, as long as they remember my first point. There are two types of counter-propaganda. There is counter-propaganda that is designed to persuade people to change their minds, and there is counter-propaganda that is designed to reinforce the moderate views that the silent majority already hold.
I shall give an example. When I was a youngster in the 1960s, a huge argument was going on about whether this country should continue to be defended by a nuclear deterrent. I was sure that it should continue to be defended by a nuclear deterrent, but time after time I would see people on the television and hear people on the radio saying, “No, that isn’t necessary.” I began to think, “Well, I’m only a teenager. What do I know about this?” I began to doubt my own commitment. Then one day, someone from another country was being interviewed on television and he made such a convincing case for the nuclear deterrent, and articulated so much better than I could, as a youngster, the case for what I believed already, that I thought, “Fine. I’m okay. That’s all I need to know. At least one other person in the world, brainier and more articulate than I am, has come to the same conclusion for the same reason.”
I believe that groups such as Quilliam both need to do the type of work that I have described and actually do that type of work. There are moderate Muslims who, because of the way in which radicalism and extremism dominate the narrative, will begin to doubt themselves—even though their own views are moderate. It is the job of a group such as Quilliam to show that when the extremists say, “We are mainstream and you are un-Islamic,” in fact the reverse is the case. To get that message across, people must be knowledgeable and professional, must have a huge amount of detail at their disposal and must have access to the airwaves, the printing presses and the internet.
I am very sorry that the Government, because they believe in persuading people to change their minds, are to kick away the support from an organisation that is dedicated to reinforcing people who do not need to change their minds, but need to be encouraged to speak up and need to be reassured that they are right and the extremists are wrong. This is not a commercial enterprise; it is a political fight. If the Government want to take the line that the organisation must be self-funding and self-supporting, let us ask ourselves this final question. How many Departments would be able to do their work if they had to raise the money to fund it themselves as a result of the product of their work, rather than their income stream coming from taxation? I think we would find that not a single Department—except perhaps the Ministry of fun—would survive such a proposition.
I believe that Quilliam’s work is essential. I believe that it is non-commercial. It has been supported thanks to the work of the right hon. Member for Salford and Eccles and of the right hon. Member for Wythenshawe and Sale East, whom I congratulate on initiating this very important debate. It is no coincidence that more than half the House of Commons members of the Intelligence and Security Committee are here making this case today, even though we are making it in our personal capacities, not as members of that Committee. I shall leave time for the right hon. Member for Wolverhampton South East (Mr McFadden) to speak. I hope that the Government will take our message extremely seriously.
Jim Dobbin (in the Chair)
Order. I know that Mr McFadden has been very patient, but I must remind him that the Front-Bench responses to the debate start at 10.40.
Mr Pat McFadden (Wolverhampton South East) (Lab)
Thank you, Mr Dobbin. I congratulate my right hon. Friend the Member for Wythenshawe and Sale East (Paul Goggins) on initiating the debate. We all know that the backdrop to it is the very serious terrorist threat that we face. That is not a myth; it is not something that has been made up. In the London underground bombings, 52 people were killed. Since then there has been the plot to blow up airliners, which resulted in the liquid restrictions on aeroplanes; we have had the shoe bomber, Richard Reid; and we have had the Christmas day attack on the Northwest Airlines flight to Detroit involving Umar Farouk Abdulmutallab. There have also been other incidents—some that we know about and probably some that we do not know about.
To combat terrorism, we of course need security forces to catch and punish those responsible but, as other hon. Members have said, we must also confront and challenge the ideology that feeds such acts. Quilliam is critical in that fight. It cannot all be done by Government and Government agencies. As other hon. Members have said, this is an ideological struggle that must take place within the Islamic community itself.
I have had less direct ministerial involvement in this issue than my colleagues, but of course our political interests are not confined purely to our ministerial experience. However, one issue in which I did have some ministerial involvement was extremism on university campuses. I commend Quilliam for the work and research that it has done on extremism on campuses, which is growing. One of Quilliam’s founders, Ed Husain, outlines very well in his book the expertise with which Islamic extremists use the liberal values of those who run our colleges and universities to propagate what they want to do and put the university or college authorities on the defensive.
As we have all agreed, Quilliam is an important organisation. It is important because it is unequivocal in its condemnation of terrorism. It challenges the ideology that feeds it. It condemns suicide bombings; it does not make excuses for them. It takes on arguments perpetrated by the apologists for terrorism. Quilliam is also important in another sense. It challenges the notion, sometimes spread by non-Muslims as well as Muslims, that the terrorist problem is all our fault—the conceited notion, ultimately, that the west is so all-powerful that it is responsible, either through its foreign policy decisions or through other means, for encouraging terrorism. Quilliam challenges that, too, so it provides a service well beyond the argument that currently takes place within the Islamic community.
Mr Denis MacShane (Rotherham) (Lab)
I am sorry that I came into the debate late; that was because of a traffic problem. Does my right hon. Friend agree that he is repeating almost word for word the message of the Prime Minister both at the Community Security Trust dinner two weeks ago and in Kuwait—the message that he has constantly urged? I understand why the Liberal Democrats want to kill Quilliam, but I just cannot understand why Conservative officials and Ministers in the Home Office want to do it such damage.
Mr McFadden
I cannot speak for the Conservatives. The Minister will have a chance to do that in a few minutes.
As we have said, what Quilliam does is important because those who lead it are themselves ex-supporters of violent jihad. Therefore it is done with a level of understanding and engagement in ideological and, indeed, theological debate that is well nigh impossible for Ministers. That is important because it is extremely difficult for the state to engage in theological debate, and the argument must be won theologically as well as ideologically.
The Government have proposed to cut core funding for the organisation. That is a mistake. As the hon. Member for New Forest East (Dr Lewis) said, Quilliam has given strength and confidence to others, too. That is a very important aspect of its work. By stepping forward, people from the organisation have given strength to others who probably think these things but may not have seen other people in the debate giving voice to them.
I shall ask the Minister a direct question. I understand that the Home Office budget is under pressure—the pace and scale of cuts is an argument for another day—but is the decision purely budgetary or, as the hon. Member for New Forest East implied, is something else going on? Is there a wider disagreement with what Quilliam has advocated in recent years? I believe that the proposal made by my right hon. Friend the Member for Wythenshawe and Sale East for a grant of £150,000 to give the organisation time and space to seek alternative funding is worthy of support, even in these difficult times.
Let us just ask ourselves this question. What will the debate about terrorism be like if Quilliam folds? The hon. Member for Carshalton and Wallington (Tom Brake) said that there are other organisations. I have not really seen them. I have not seen others stepping forward with the degree of clarity and theological and ideological commitment that Quilliam has had.
There is a complacency about saying that others will simply step forward. I have long experience of seeing this ideology develop, not particularly as an MP, but as a Government staffer. I have seen some of the errors that Governments have made in the past and, frankly, I do not want to return to the situation we had 10 years ago, when we listened to many voices that we thought were representative. There is a danger of complacency in cutting Quilliam’s funding, and if the Minister thinks that other organisations will step forward to fill the void if Quilliam does not get the funding it so urgently needs, I would like him to name them today.
I hope that the Minister has heard the arguments that have been made today. I also hope that he will respond positively to the proposal from my right hon. Friend the Member for Wythenshawe and Sale East and tell us exactly who will speak up and make the arguments that Quilliam has made if that organisation no longer exists.
Jim Dobbin (in the Chair)
Thank you, Mr McFadden, for a disciplined speech.
Mr Gerry Sutcliffe (Bradford South) (Lab)
It is a great pleasure to serve under your chairmanship, Mr Dobbin. It is a delight to be involved in a debate that has none of the partisanship we would expect when talking about organisations’ funding.
I congratulate my right hon. Friend the Member for Wythenshawe and Sale East (Paul Goggins) on securing the debate. I also congratulate other right hon. and hon. Members on their contributions, which they made with passion. They have shown their credibility and the experience they have gained in an individual capacity, although as the hon. Member for New Forest East (Dr Lewis) said, they also represent almost half the members of the Intelligence and Security Committee. The Minister would do well to take that experience on board. In that respect, I was impressed to hear that Lord Carlile, who has been the independent adjudicator on counter-terrorism matters, also supports Quilliam. As my right hon. Friend said, the Government have made the wrong decision—I fully understand why, given the cuts to the Home Office budget and the problems Ministers face—but they now have an opportunity to put things right.
I want to put on record my thanks to my right hon. Friends the Members for Wythenshawe and Sale East and for Salford and Eccles (Hazel Blears) for the work they did as Ministers after 7/7. As a West Yorkshire MP, I am well aware of the mood—the shock and horror—in West Yorkshire when we found out that the bombers were from our area. There was great concern in communities, and I am grateful to Members for saying that the majority of Muslim people support the state and do not agree with the atrocities that have taken place.
Paul Goggins
My hon. Friend takes my mind back to the day I visited Bradford, when he and other colleagues helped to organise an important meeting with the Muslim community. Does he remember that the central focus of our discussion was concerns about the inability of us as outsiders, and indeed of Muslim leaders themselves, to communicate effectively with young people in the community? Is that not something that Quilliam can do very effectively?
Mr Sutcliffe
Very much so. That was one of the key points. My right hon. Friend the Member for Salford and Eccles was honourable enough to say that although we got lots of things right in Prevent, we also got lots of things wrong. Communication with the community was one of the things that was difficult; at one point, the community felt that it was under attack by the state and that we were describing it as the enemy, for want of a better term. The reality was that we needed to get into the community, and particularly to young people who felt isolated. Quilliam can do that.
What strikes me about the debate is that Quilliam has been acknowledged as an organisation that speaks its mind. In speaking its mind, however, it can also create enemies and problems, including with officials in Departments, although I do not mean that in a critical way—that is just the way things develop and operate.
As has been said, Quilliam has set about these issues and produced important research on a complex and controversial subject. As my right hon. Friend the Member for Wolverhampton South East (Mr McFadden) said, its research and reports on radicalisation on university campuses has been important. It has also done work in British mosques and the prison system. As a former Prisons Minister, I was interested in what Quilliam said about the radicalisation of prisoners.
Quilliam’s reports have been enlightening and important. Just yesterday, it produced a considered and thoughtful report on the situation in Libya, arguing for action by the international community. It has also done important work overseas, and my hon. Friend the Member for Ilford South (Mike Gapes) talked about the work that it did in Pakistan, challenging extremism and promoting a democratic culture. Although Quilliam is not universally popular, it is clear that many of its critics are apologists for radical Islamism.
I have listened to the debate with interest. Accepting Government funding can give rise to the thought that people are betraying themselves as Government stooges. If people rely only on Government funding and have no other funding, are they putting themselves in a difficult position? Such thoughts have undoubtedly alienated some in the Muslim community from Quilliam. It is not surprising that Quilliam is not universally popular, however, because it tackles controversial issues and it is not afraid to tell it like it is.
When we look at Prevent, it is right that we look at all the issues. This is not the time to argue about Government cuts or the timetable for the review of Prevent. However, we should recognise that Quilliam is a powerful organisation, which is supported by many Members of the House with expert knowledge of these issues. People could argue that this is special pleading, but it is special pleading for an organisation that could, as I said in an intervention on my right hon. Friend the Member for Salford and Eccles, slip through the net if nothing happens; indeed, Quilliam is already making redundancies and looking at its finances.
Ministers face difficult decisions in good times and bad times; they have to deal with budgets and other issues, and they rely a lot on support from their officials. However, if decisions are not taken quickly in this case, Quilliam will be lost, and if it is, it will not be rediscovered, as Members have said. We cannot readily call on such expertise.
I hope that the Minister will answer the question posed by my right hon. Friend the Member for Salford and Eccles in the spirit that she asked it. We need to know what is going on. Is this a political decision? Have Ministers reflected on the issue in light of the support for Quilliam? The hon. Member for Carshalton and Wallington (Tom Brake) is right to say that we have to look at every area of spend in these difficult times, but it is important that we do not throw the baby out with the bathwater.
I fear that the Government’s good intentions in reviewing Prevent could put an end to an organisation that has credibility and support in the UK and internationally. In that respect, I am heartened to hear that it has charity status in the US, which shows its willingness to go out and look for other funding. It is important that it retains credibility in terms of where it gets its funding. As has been said, it could get funding from many different organisations, but would that be the right funding for Quilliam, given the context of its work?
I hope that the Minister will reflect on the debate, which has been excellent, well-informed and non-partisan. I understand that difficult choices have to be made, but I hope we can make sure that this organisation does not slip through the net.
The Minister for Immigration (Damian Green)
In congratulating the right hon. Member for Wythenshawe and Sale East (Paul Goggins), let me say how grateful I am for the constructive way in which he made his suggestions and asked his questions; indeed, I am grateful for the constructive tone in which the whole debate has taken place. I am particularly grateful to have had the benefit of the experience of the right hon. Member for Salford and Eccles (Hazel Blears), who clearly grappled with these absolutely vital, difficult and sensitive issues when she worked in various Departments.
I should say at the outset that there is no doubt that Quilliam has done important work in support of counter-terrorism efforts in this country. Various Members on both sides have quoted the Prime Minister’s Munich speech, in which he set out the course that the Government will follow on counter-terrorism, and Quilliam continues to contribute to that. The Home Office understood the role that Quilliam could play when it helped the organisation get off the ground in 2008. Officials and Ministers provided it with extensive advice and assistance at that time.
The Home Office envisaged that Quilliam would be able to work in and with Muslim communities, and particularly with young people, challenging and exposing terrorist ideology and contributing to the aim of stopping people becoming terrorists or supporting terrorism, to observe the distinction made by my hon. Friend the Member for New Forest East (Dr Lewis). The Home Office judged that, as former radical Islamists themselves, Quilliam’s founders would be able to draw on their own experiences to describe that ideology, explain why it might seem superficially compelling and demonstrate its incoherence. Quilliam subsequently developed a significant research function, and has published some papers on important issues, including radicalisation on the internet, in prisons and in further and higher education.
It is fair to say that, since 2008, Quilliam has developed a brand, a message and a clear public position. It is known not only in this country but overseas, notably in the USA. Throughout that period, both the Home Office and the Foreign Office provided Quilliam with significant financial assistance. Quilliam has received more Home Office Prevent funding than any other single organisation—nearly £1.2 million over the past three financial years. The Foreign Office has provided nearly £1.5 million in project funding over the same period.
Regarding funding for Quilliam and other organisations, Pakistan was mentioned and the important work that needs to be done there. Tackling radicalisation in Pakistan is clearly important but, to put it into context, there are nearly 100 organisations, large and small, supporting Prevent overseas. More than 20 of those are in Pakistan, many of them working anonymously for obvious security reasons. All of those are funded by the Foreign Office.
This financial year, the Home Office has provided Quilliam with six-figure funding. It has been invited to submit bids for project funding in the next financial year.
Damian Green
There are indeed, and I will come to exact figures in a second.
The funding provided to Quilliam has been unique, not only in its scale but in its scope. It has been used not just for projects and programmes but, exceptionally, for significant overheads and running costs. The Government agree that Quilliam deserved some support in the past, and we continue to believe that Quilliam is capable of useful work. However, following a review of all the organisations, projects and programmes supported as part of the Prevent strategy, Home Office Ministers have taken the decision to end funding for Quilliam’s running costs from the end of this financial year. Clearly, that is the heart and purpose of the debate.
I say to the right hon. Member for Wythenshawe and Sale East that there is an offer on the table to Quilliam of tens of thousands of pounds to cover the next few months of basic operations. He and the array of distinguished ex-Ministers on the Opposition Benches will recognise that this not the place to conduct detailed financial negotiations. I want to assure him and everyone who has attended the debate that there is an offer. It would be foolish for me to start negotiating here; I will merely gently observe that the £150,000 transitional money referred to by several right hon. and hon. Members is actually more than the total Home Office money given to Quilliam over the past 12 months, as decided by the previous Government. I would not want anyone to leave the debate with the thought that £150,000 is a small percentage of what Quilliam might have expected to receive. It is actually more than the total budget received from the Home Office in the past year.
Hazel Blears
Will the Minister give an indication of when Quilliam was first told that it would need to replace the Home Office funding with funding from other sources?
Damian Green
In December. My hon. Friend the Member for New Forest East asked for specific numbers. The trajectory of Home Office direct funding for Quilliam is quite clear. In 2008-09, it was £665,000; in 2009-10, it was £387,000; and in 2010-11, it was £145,000. There was a clear trend in the direction agreed with by everyone who has spoken in the debate: that is, that Quilliam does good work but that a think-tank of that kind should not be reliant for its core running costs on Government funding.
Damian Green
If my hon. Friend will excuse me, I need to make some progress, because others have asked interesting “in principle” questions, which I need to address. He himself gave the impression there was some kind of conspiracy afoot, and I wish to reject that.
Home Office Ministers have taken the decisions they have for three reasons. First, Quilliam has, as we all agree, evolved into a think-tank; it is no longer fulfilling the role for which it was originally funded by the previous Government. Secondly, Quilliam has continually committed to broadening its sources of funding and to becoming more self-reliant, and I think we agree that that needs to happen. Thirdly, Home Office Ministers believe that the Department can no longer make an exception for Quilliam by paying for its ongoing running costs as well as funding specific projects. The Home Office does not support any other think-tank on that basis, a point well made by my hon. Friend the Member for Carshalton and Wallington (Tom Brake).
Let me deal with each of those points in turn. As I have already said, the original purpose for which Quilliam was funded by Government was to work in and with Muslim communities to challenge the ideology of terrorism and extremism. In some cases, that has not been done as successfully as Ministers originally hoped. Since 2008, Quilliam has progressively engaged in a different and rather broader range of activities consistent with its declared intention of being a think-tank. It publishes work on a range of security issues, not confined to the narrower and hugely important issue of countering radicalisation. In doing so, I emphasise again, Quilliam makes important contributions to the overall debate.
Mr McFadden
I appreciate the pressure of time. I am not sure that I accept the distinction the Minister makes between think-tank work and countering extremism. The publication of the reports is important in countering extremism. To get to the point, can the Minister say who he thinks will step forward and do this if Quilliam folds?
Damian Green
I am trying to come to that point. The principle we want to uphold is that Quilliam should be free to contribute to the wider debate, but not depend on Government funding to do so. The other think-tanks that have also published on radicalisation—including Demos, the Policy Exchange and the Centre for Social Cohesion—all operate on that basis. It is the way that all successful think-tanks need to operate. The right hon. Member for Wolverhampton South East (Mr McFadden) asked a reasonable question about whether think-tank work can contribute to countering radicalisation. That is done by a number of think-tanks. There is an important point of principle about whether think-tanks should continually depend on direct state funding for their core activities to continue their work year after year.
Paul Goggins
I am grateful to the Minister for giving way: all of us who have been Ministers recognise that the timing of winding-up the debate is a fine art, and there is much ground to cover.
The Minister has recognised the contribution that Quilliam has made. He talked about an offer running into tens of thousands of pounds. We have argued for £150,000. If there is good will, a real interest in making sure that the organisation can survive, will the Minister agree to meet me and other colleagues to pursue that, to see if what may be a narrow gap can be closed?
Damian Green
I am always willing to meet the right hon. Gentleman. I know he met the Home Secretary yesterday, and the situation on the subject has not changed radically in the 12 hours since he met her.
Let me address the issues. The Foreign Office and the Home Office fund a number of small organisations, charities, civil society organisations and faith communities to deliver the Prevent programme, overseas and in this country. There are more than 130 such organisations. To protect them and their credibility we do not disclose their names. I am sure everyone will recognise that they are sometimes working in high-risk environments. Their credibility needs protection because research that appears to be British Government-inspired will inevitably have less credibility.
The right hon. Member for Salford and Eccles asked about RICU. It has clearly received staff and resources from the Foreign Office, from the Department for Communities and Local Government and from the Home Office, recognising the challenge of producing a coherent narrative overseas, nationally and among local communities. I will write to her on the details.
NHS (Essex)
(13 years, 1 month ago)
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Priti Patel (Witham) (Con)
I am grateful to Mr Speaker for granting me the opportunity in Westminster Hall to draw directly to the Minister’s attention a number of important issues regarding the performance of NHS services in my constituency and in the county of Essex. I suspect that the matters that I shall raise and the constituents’ cases that I shall mention are by no means unique to my constituency or the county. However, the Government are developing the most important and, in my opinion, long-overdue changes to the NHS, and I want to ensure that the problems and challenges faced by my constituents are thoroughly and fully considered.
Throughout the endless reforms and reorganisations undertaken by the previous Government, the health needs of patients were never afforded the same priority as the expanding tick-box bureaucracy suffered by my constituents. One consequence of the waste that was created is that the money put into the health service never achieved the true outcomes that my constituents deserved and needed. That has led in part to my constituents suffering poor patient choice and health care services. However, we cannot change everything about the past.
The Minister, the Government and, most importantly, my constituents want an effective NHS for the British people; it should deliver value for the taxpayer, ensuring that the mistakes of the past are not repeated and that all receive the care and front-line services that are their due. It is therefore essential that as the NHS is reformed, the needs of local communities in my constituency of Witham are not overlooked or ignored. That is why this debate is so timely.
By way of background, I shall give the Minister some details about my constituency and some of the health care challenges faced by my local community and me that are specific to the area, and the nature of current NHS services there. I shall then highlight the excessive and overblown bureaucracy that affects the NHS globally, which demonstrates the scale of taxpayers’ money that is increasingly and wrongly being taken from front-line services. I shall also draw attention to some of the most serious and heart-breaking cases that I have come across in the 10 months since I was elected, which show that the NHS too often fails the most vulnerable. I shall conclude my remarks by putting the case for new NHS services being delivered locally under the Government’s planned reforms.
Witham is a new constituency, so I forgive Members for not knowing much about it. It is not far from the London commuter belt, and lies within the heart of Essex. We have tremendous public transport and road links to London. The ports of Felixstowe, Harwich and Tilbury are not far away, and we have some major industrial towns and centres. It is not surprising, therefore, that Witham has experienced significant population growth in recent years. It is an attractive area to live in.
The three local authority areas in my constituency are Braintree, Colchester and Maldon. Under the previous Government, they were required to build more than 27,000 new homes in the 20 years to 2021, and 60,000 new homes between 2011 and 2031. Throughout Essex, the current population of 1.4 million could easily grow by 14% over the next 20 years. Members will be aware from their own areas that population growth inevitably puts more burdens not only on infrastructure but on the local NHS.
The local plans, particularly those that affect my constituency, unfortunately give no serious consideration to ensuring that the quality and quantity of local health services can keep pace with projected population increases and changing demographics. Although top-down targets are being scrapped by the present Government, the attractiveness and desirability of my constituency inevitably means that more people will move to the area, so we can expect to see a significant increase in the local population. That will put demands on local health services that are already struggling to cope.
It is not simply the sheer quantity of people that NHS services will need to support; they will also need to adapt to the changing demographics of the area. Because our local communities attract young families, we need stronger maternity services and paediatric provision. However, the most significant demographic change will be an acceleration of the number and proportion of residents over the age of 65. In that respect, my constituency and the county of Essex are not unique, as health services across the country are responding to an ageing population. By 2021, the NHS in Essex, along with its partners in local government, will need to accommodate the health needs of 45% more people in the county living beyond the age of 65, and 75% more people living beyond the age of 85.
Some of the most significant increases in Essex are expected to be in the Maldon district, part of which falls within the Witham constituency. It is worth noting that about 10% of the Essex population provides assistance, caring for family, friends or neighbours, with higher than average rates in Maldon, where the number of working-age people available to care for older persons will have nearly halved by 2029. These demographic changes present serious challenges to the front line of the NHS in my constituency and in the county.
I am pleased to report that Essex county council is taking a strong lead in implementing the Government’s reforms to deal with the challenge. It has already established a health and well-being board, and the Department of Health recognises it as an early implementer. I would welcome the Minister’s reassurance that the Government, unlike the Labour party, which has made no commitment to NHS funding to support this work, will continue to increase resources when necessary to support the health needs of my constituency and Essex. I shall emphasise throughout the debate the need for the money to be spent on front-line care, not bureaucracy.
That brings me to NHS bureaucracy in Essex and my constituency, and specifically to our local primary care trusts. The Minister will be aware that the medical needs of my constituents are served by a number of NHS trusts and by the East of England strategic health authority. There is no general hospital in my constituency; local residents usually use the Broomfield hospital run by the Mid Essex Hospital Services NHS Trust, which is based in the neighbouring constituency—that of the Minister of State, Department of Health, my right hon. Friend the Member for Chelmsford (Mr Burns)—or the foundation trust hospital in Colchester for acute care services. Mental health services are provided by the North Essex Partnership NHS Foundation Trust.
My constituents are served by two of the five primary care trusts in Essex. Those who live in the Braintree district council or Maldon district council parts of my constituency fall within the area covered by the Mid Essex NHS trust, whose budget for 2011-12 has increased to just under £520 million. Those who live in the wards covered by Colchester borough council find themselves being dealt with by NHS North East Essex, whose budget for 2011-12 has risen to just under £547 million.
Later, I will give examples of cases in which constituents have faced unacceptable problems with those health trusts. In the meantime, it is worth looking at the obscene levels of bureaucracy, administration and management that have taken hold of those organisations. The number of managers and senior managers employed by the East of England strategic health authority doubled under the previous Government from 1,300 in 1997 to more than 2,700 in 2009. At Mid Essex Hospital Services NHS Trust, more than £10 million is spent annually on 29 senior managers and 79 managers. In the North East Essex PCT and its three predecessor trusts, the proportion of administrative staff rose from 19% to 33% between 2001 and 2009. The number of managers and senior managers increased from 25 to 84.
Finally, Mid Essex PCT, which serves the majority of my constituents, and its four predecessor trusts, saw administration and staffing levels rise from 17% to 33%, and the number of managers go up from 10 to 102. When we consider that those two PCTs were formed from seven predecessor organisations, it is fair to say that the growth in management and administration over eight years is quite shocking. The PCT now spends almost £13 million on management costs alone. That money, which my constituents and I view as hard-pressed taxpayers’ money, has been taken away from essential local medical care to staff a bureaucracy. Mid Essex PCT is also experiencing slippage in progress on its quality, innovation and prevention plan and, as a result, could now miss its year-end target by £2.7 million. On 16 November, the minutes of its remuneration committee, which have not been disclosed fully, indicate that performance bonuses were to be paid to the chief executive and its executive directors.
What concerns me is not just the vast sums of money increasingly flowing into the pockets of bureaucrats and managers, but the way in which the PCT is behaving and functioning since it embarked on its reorganisation. It seems to have no real idea as to what it is reorganising into. That is a cause for alarm. I hope the Minister is aware that last autumn, North Essex PCT and Mid Essex PCT decided to form a cluster with West Essex PCT under a new chief executive. The first I heard of that change was when I received a press release last September. In a massive blaze of glory, it was announced that the chief executive of the strategic health authority would form closer working arrangements with the PCT.
Ms Diane Abbott (Hackney North and Stoke Newington) (Lab)
The hon. Lady has spoken at some length and with real passion about money being poured into the appointment of bureaucrats and managers. In her mind’s eye, a hospital bureaucrat is a man in a bowler hat with a brief case, but is she aware that many people who are dubbed managers in the health service are actually former senior nurses, such as her colleague, the Minister, who bring much of their clinical background and expertise to bear on their role? Nurses in particular get a little pained when politicians talk about managers and discount the fact that many of them are people with a very solid clinical background.
Priti Patel
I recognise that NHS managers have a range of health care backgrounds and bring a number of skills to the table. Of concern to my constituents though is the fact that we are dominated by managers who tend to have administrative rather than clinical backgrounds, and they are making key decisions about patient treatment, and even about medical care and access to drugs. None the less, I thank the hon. Lady for her comments and her valid point.
This brings me to the overall efficiency and effectiveness of the reorganisation. I have been told that reorganisation will lead to a significant step forward in delivering greater efficiency for the people of north Essex. None the less, I constantly have to ask the PCT, “What does this mean? What will this look like? What are the costs of the reorganisation?” I was told last autumn that the PCT could not quantify the cost of reorganisation as the process of reconfiguration had only just started. I have been asking for updates, but as yet, have not received any. Each time I ask anything, I am told that my question cannot be answered “at this time”.
There is far too much uncertainty. I welcome reorganisation, efficiency drives and reductions in management and bureaucracy costs, but there are major implications for front-line services. The language of the PCT is constantly about reorganisation producing greater efficiencies, which I would not dispute, but the PCT still has no detailed plans to show what the greater efficiencies will look like and what the formation of the new cluster will mean for local services.
The merging of back-office functions to save money is to be welcomed and I have no issue with that. In this case, however, I have discovered that there is no forward plan in the form of a route map and details of how things will operate. I have been asking questions for six months, but I have not received any substantial details about the new cluster, the staffing arrangements and what it will all mean for patient choice locally. I have sent written questions to the Secretary of State about the reorganisation but, again, I have not had a response.
Will the Minister examine this reorganisation and ensure that more information is made available to the public so that they have some sense of what kind of decision making is taking place locally within the new cluster and the PCT, and what it will mean to them in terms of access to health care and local services? It appears that many of the decisions have been taken behind closed doors, with very little accountability and transparency. It is in the public interest to know what has transpired within the reorganisation, and what the new arrangements will look like as well as the costs and the benefits.
As the PCT should rightly be beginning its winding-down process prior to its abolition, I would like to hear from the Minister about the redundancy arrangements for senior PCT managers. I am sure that that is a matter that is naturally in their minds right now. In view of the colossal levels of waste caused by PCTs, my constituents will be very disappointed to see PCT chief executives and other senior directors receive golden goodbyes to boost pension pots or huge redundancy pay-outs. In the interests of accountability and transparency, all constituents across the country will be looking, during the NHS reforms, for some encouragement from the Government on that issue.
Before I move on to some individual cases, let me just say that I make no apologies for being critical of NHS bureaucracy. In my limited time as an MP, I have seen endless examples of red tape standing in the way of my constituents getting the best health care that should be available to them. I am overwhelmed by the whole culture of tick-box management that has pervaded my local NHS. It is something with which I have been battling, day in, day out, on behalf of my constituents. It is an alarming state of affairs.
Let me now draw to the Minister’s attention a couple of cases. I have been in touch with the Minister and the Department about the issue of Sativex. There have been two cases in my constituency in which the PCTs have refused to treat patients on the NHS with the drug Sativex despite their doctors’ recommending its use to help with multiple sclerosis. In both cases, the PCTs have been able to afford to pay more to their managers and to spend more on red tape and bureaucracy, but have refused to provide vital medical treatment to my constituents.
First, Mr Shipton from Tollesbury was recommended Sativex by four doctors, to help his condition. Those doctors are medical experts who have been treating him and who are aware of his condition and medical needs. However, last September Mid Essex PCT, acting through officials sitting on its area prescribing committee, thought that it knew best and decided that it would not accept a request for Sativex to be prescribed to Mr Shipton on the NHS. That left him in considerable pain and distress. It then took more than a month for the chief executive of the PCT to respond to my request for copies of minutes of the meeting at which that decision was made. The minutes stated that the PCT declined to prescribe Sativex to Mr Shipton
“due to a lack of evidence of significant long-term benefit. Clinical trials are of very short duration and do not compare with current treatment.”
Despite that, however, Sativex is already licensed—in fact, it was licensed last June—for use to improve symptoms in multiple sclerosis patients with moderate to severe symptoms, clearing the way for the PCT to prescribe it. Indeed, the PCT itself had made 31 previous prescriptions of Sativex in 2009-10.
My constituent, Mr Shipton, ended up sourcing Sativex privately, at the cost of £125 plus VAT per bottle, which is a course of treatment that lasts for only two weeks. Contrary to the conclusions of the area prescribing committee, the drug is having a hugely beneficial effect on Mr Shipton. If the bureaucracy of the PCT had not stood in the way, he could have received that treatment at a much earlier date and he would not have had to endure extreme suffering and pain, as well as what I would describe as an unnecessary bureaucratic process.
I have another constituent, Mr Cross from Tiptree, who has also experienced horrendous problems. In fact, his wife, Mrs Cross, is on the phone to my office on a weekly basis, updating us about the terrible position that her husband is in and the suffering that he is experiencing. He has had horrendous problems receiving a prescription of Sativex, although in this instance the obstacle has been dealing with North Essex PCT. Mr Cross is wheelchair-bound and in terrible pain, experiencing constant spasms. In fact, he has recently been in hospital. Given his condition, any treatment would be a welcome relief for him. There is double suffering for his wife, as it were, because she is now effectively his full-time carer. Once again, getting access to this drug has been terrible. He has had his consultant neurologist battling for him and making his case, and I too have battled for him and made his case. But North Essex PCT, despite issuing 16 prescriptions for Sativex in 2009-10, still refused to prescribe this treatment for Mr Cross and gave him a highly dismissive response.
When I took up Mr Cross’s case from September 2010 onwards, I began a process of constant correspondence with the PCT. All I received were evasive non-responses and the odd reference to Mr Cross’s “medical needs”, which were then just dismissed. I found that totally unacceptable. Mr Cross’s condition has since deteriorated and he has been in hospital again. There needs to be a recognition of the endless stress and strain that this process puts on his own domestic set-up, especially his dear wife who is now his constant carer.
There is a compelling case for action in both of those cases, to press the PCTs to provide this drug. Also, both of my constituents have made the point that they have spent their lives working hard, doing the right thing and contributing to society. They felt that in their hour of need the NHS would be there for them, but now they feel that it has not been there for them. That is unacceptable. Although I appreciate that the Minister cannot intervene in individual cases, I ask her at least to examine these cases if she possibly can.
There are two other cases that I want to touch on briefly. The first is that of my constituent Mrs Emily Wetherilt, and again I would welcome the Minister looking into it. It is another example of a local PCT failing to perform adequately to meet the medical needs of my constituents. Mrs Wetherilt is 96 years old and requires 24-hour care. However, despite her case meeting the published criteria for NHS continuing health care funding, Mid Essex PCT has refused to provide any care whatsoever. So there has been no support for her from the PCT. Mrs Wetherilt’s daughter has taken up this matter directly with the PCT’s panel twice and she has been declined on both occasions. The PCT categorically refuses to look into this matter again, because an appeal had not been lodged within the two-week window that was available to Mrs Wetherilt’s daughter.
Many of us recognise that in cases such as this one, when a constituent’s family is caring for them, the family’s priority is looking after their family member and it is not to follow an appeals process within a two-week window. People become very emotional and providing care takes precedence. That care is the priority. Consequently, the tone and the attitude adopted by the PCT are utterly bureaucratic and deeply unhelpful.
Mrs Wetherilt’s daughter has also offered to work with the PCT to find out whether it is possible for the PCT to part-fund her mother’s care, but that suggestion was dismissed by the PCT without even being addressed. That is another example of the inflexible bureaucracy that fails to put patients’ care and needs first. It is more about the process—ticking boxes and filling in forms—and that is wrong.
I have a final shocking case to highlight. It is one that I have raised previously in the House and it is that of my constituent, 14-year-old Bethanie Thorn. Last October, Bethanie was struck down with a terrible illness and left bed-ridden. She literally went from being a healthy teenager one day to being completely bed-bound two days later. The cause of her symptoms was unknown and she became unable to eat as her condition deteriorated. Nevertheless, she faced lengthy delays to get an MRI scan and the other vital checks that were needed to diagnose her condition.
It was only last November, when I raised this matter on the Floor of the House, that the Secretary of State looked into Bethanie’s case and appointments were made for her to have an MRI scan. People in urgent need of an appointment should not have to rely on the Secretary of State, local newspapers or their constituency MP to raise their case and sort appointments out. It shows how serious this case was that, shortly after her scan and check-up, Bethanie was admitted to hospital and she was only able to return home two months later, at the end of January. Her mother has effectively become her full-time carer and her family have had to battle at every single stage for care, appointments and treatment, which is appalling. I must say that, if Bethanie had received the appointment that she needed straight away, she would probably be in a better state of health today. The Minister will appreciate that this has been terribly distressing for Bethanie and her family.
When the NHS was pressed about this case, the only explanation given for the delays was something described as a “broken pathway”. I have no idea what a “broken pathway” is in NHS management talk, but the case has highlighted just how damaging poor performance and failures in NHS services can be to individuals. This girl’s life has changed beyond all recognition now. This case also demonstrates what can go wrong when there are endless layers of bureaucracy in the NHS; it was unclear throughout whether it was Bethanie’s GP, the PCT or the hospital services who were actually responsible for ensuring that Bethanie received the care that she needed. There was to-ing and fro-ing constantly—there really was.
Like all Conservatives, at the last general election I was absolutely proud to stand on a manifesto commitment to cut the waste and bureaucracy in the NHS, so that we could invest in the front-line services and give more powers to doctors and patients. I want to reiterate that in my short tenure—10 months—as a Member of Parliament, all I have seen are examples of how bureaucracy has got in the way. If nothing else, I will continue to battle to get the services for my constituents, in the face of adversity—that is, in the face of bureaucracy.
I welcome the measures that have been announced by the Government about the reforms and plans for the NHS. The purpose of mentioning these cases now is to highlight the fact that in Essex we have seen more of the non-medical side of the NHS in action locally than we have of the medical side, which shows the need for reform of patients’ treatment.
Finally, I want to draw attention to the fact that there is some hope for my constituents. That is the hope that they have placed in Government legislation to reform the NHS. As the Minister will recall from Health questions last week, Witham town is the most urban part of my constituency and Witham town council and others have put forward a very strong case for there to be more health care specialist services in our town. Although Colchester, Braintree and Chelmsford all have significant health facilities, including general hospitals and community hospitals, there is nothing for the people of Witham in our town, and there is nothing for the people from the surrounding villages. That gives the impression locally that there is a two-tier health system.
I mentioned at the start of my remarks that the Witham area includes some pockets of serious deprivation and has a growing population. Unfortunately, the PCT has not taken enough action to close the gap created by the changing demographics and local needs. Maltings Lane is a new housing development in Witham town. It has evolved over a number of years, and many more new homes and other facilities will be built there over the next 10 years, but it was begun with no plans whatsoever for additional health care services. That issue needs to be addressed in the long run, and I hope that the Minister can help my town council, along with our district and county councils, to work with the PCT and the forthcoming GP consortia to develop additional local services that seek to meet local needs. The issue is one of supply and demand, and there is a crying need but no provision.
As a starting point, the town council, to its credit, is working cross-party locally with all our councillors, and has put together a list of services that Witham needs, including an additional surgery, an out-of-hours walk-in clinic, minor injury, oncology and out-patient clinics and a diversity of medical-testing facilities. By adding some of those services to Witham and the surrounding communities, we will naturally see real benefits in the form of health care provision, choice and diversity, and we will enjoy the convenience of more local NHS services.
I am conscious that I have spoken for a considerable time and that many other Members wish to speak, so I shall conclude by saying that although I could raise many more health-related issues, I hope that I have given the Minister a real insight into the challenges that we face in Mid Essex, where we are surrounded by a lot of health activity but have had this bureaucracy that has stifled both the delivery of front-line care to patients, and the choice aspect of health care provision locally. I thank the Minister and colleagues for their patience in listening to my remarks, and I look forward to the Minister’s response.
Mr David Amess (Southend West) (Con)
I congratulate my hon. Friend the Member for Witham (Priti Patel) on securing this debate, and particularly on how she has raised concerns on behalf of her constituents. Witham is very fortunate to have her as its representative.
I served on the Health Committee for a decade; in fact, I was on it for so long that towards the end of that time we were repeating inquiries. We travelled to a number of countries and when we returned home, we always concluded that our health service was the best in the world. We did wonder, however, how on earth we would fund the service if we were starting it from scratch.
Since I first became involved in health matters, the needs and demands of the health service have changed dramatically. I am in a very good position to comment on such matters because when Ann Widdecombe was shadow Secretary of State for Health I was one of her troops, serving on the Committee on the Bill that brought into force primary care groups and primary care trusts. Although the right hon. Member for one of the Southampton constituencies got slightly irritated with my endless questioning and long speeches, if anyone is very sad and wants to read Hansard I recommend the speeches that I made then because everything that I forecast would happen, sadly, has happened. It has taken the present Government to reverse what happened 13 years ago.
I am very familiar with four hospitals: Newham General, the King George in Ilford, Basildon and Southend. I will not share my views of my experiences at those hospitals, because I was there not just as a politician but as a user, along with my family. I shall simply say that the experiences were very different from one another, and they are ongoing.
Let there be no doubt that I agree with everything that my hon. Friend the Member for Witham said. I have to be slightly partisan; I have to tell my hon. Friends who were elected last year that I feel very strongly that during the 13 years of Labour Government the word “deprivation” was not on the register at all for the south of England. There is no doubt that resources shifted from the south to the north. All I say to the Minister, who has a wonderful background, is that I hope we will now be treated fairly. I am confident that that will happen.
I am more concerned now about management generally, particularly that of our hospitals. Why is a school considered good? Because it has leadership from an excellent head. Why are transport facilities good? Again, because there is good leadership. Why is a country successful? It is because of a great Prime Minister. I am challenged on a number of fronts by leadership in our hospitals. I will not go on about matrons, but when people are anxious and have health problems, with which they need to go to A and E for example, they want to know who is in charge. It is not rocket science. Nor is cleanliness and all the rest of it. Leadership is so important, and I do not care if a leader is seen as a bossy boots, like Hattie Jacques. I am fed up with managers who have endless meetings. What are they meeting about? As MPs, we have to take full responsibility for how we represent our constituencies, and if something is not right it is down to a hospital’s chief executive—it is no good their blaming the troops.
My hon. Friend the Member for Witham touched on some matters concerning Essex, for example the demographic pressures and shifts. The council and the NHS have developed, and are continuing to develop, joint commissioning arrangements there. That is very good. In Essex, we are working hard to implement the White Paper, and are progressing well with putting into practice the Government’s flagship reforms. The Secretary of State has been criticised in some areas for rushing the reforms, but in my time in the House I cannot remember a shadow Secretary of State who was in post for as long as my right hon. Friend was, so he had a lot of time to think about the reforms. This is the only job that he wanted, so the idea that he is rushing is wrong.
In Essex, commissioning with the independent voluntary and community sectors is going extremely well, as is the scrutiny of health functions. As the changes—some of which are controversial and challenging—go through, will the Minister reflect on how our hospitals are managed? That is so important. In my previous constituency the fullest age profile was for young people and in my present one we have the most centenarians in the country, so the challenges are very different in different places.
I want to raise a number of quick points. I will not cause the Minister angst, but she will be aware that there is an issue locally with the Essex Cancer Network and the proposal for an increase from seven to 10 linear accelerators. I hope that any increase is in Southend, and that we do not look further afield. The Minister would expect me to say that, and I do not want to put her in a difficult position.
For the past nine months, all health and social care partners and representatives of patients, carers and care homes have been working in a formally governed partnership to deliver an innovative and integrated model of care for the elderly locally. Will my hon. Friend the Minister look at how we are dealing with that? Over the past year, partners have worked together to open a new “step up” intermediate care facility on the Southend hospital site. I wish that many years ago, managers had considered more carefully when deciding to close Rochford hospital. Unlike Basildon hospital, which has plenty of land around it, Southend hospital is landlocked and has nowhere to expand, and we are paying the price.
Demand for care of the elderly is increasing, and I am not entirely convinced that we have a solution at the moment. Children’s services in south-east Essex are doing well. We have been recognised as baby-friendly by UNICEF and have received a certificate of commitment. We are launching a new service for children and young people with disabilities and we are opening a new diabetes rehabilitation suite. Southend hospital has secured a patient safety award. Many good things are happening.
GPs are being asked to deliver health care reforms. When Bernard Ribeiro, who has now been made a peer of the realm, was the lead consultant at Basildon, it was clear where the leadership of consultants was. I am puzzled to know who leads groups now. Endless meetings are held, but we need ownership and someone to take responsibility for what happens when a patient arrives at hospital. Who sees them first? When they go to accident and emergency, are they seen quickly by triage? Who deals with their case afterwards?
We have many wonderful GPs in Southend— Dr Husselbee, Dr Pelta, Dr Lawrence Singer, the Zaidis; the list is endless—and they are all working hard to deliver what the Government want. I believe that my constituency has the only GP pathfinder consortium in south-east Essex, and it has one of only seven partnerships in the east of England announced during the first wave. The group covers a population of nearly 80,000 patients, mainly in the west of Southend.
The practices have been working well together for the past three years and have managed to set up out-of-hospital ear, nose and throat, gynaecology and urology services, which give rapid access to specialist care at less cost to the NHS than at present. The group has implemented a clinical gateway that enhances GP referrals, reduces waste and ensures that patients get to the right specialist first time, which is critical to reducing the amount of money spent and the stress caused to patients waiting for referrals. Practices co-operate closely, with patients attending other surgeries for minor surgical procedures.
As a result of such close working for the past three years, the group is moving forward and seeking to become a sub-committee of the primary care trust, which will not exist within 18 months, and to take greater control of the budgets delegated to it by the PCT. The group has ambitious plans to improve care for the elderly, which I salute, as well as the health of patients with long-term conditions.
When local authority work begins, close working relationships will be vital to align the health and social care budgets to enable—colleagues might be puzzled by this phrase—more integrated working. That will be better for patients and lead to greater efficiencies. Similar joint working is happening between community and mental health programmes. The Health and Social Care Bill clearly puts patients at the centre of the NHS. This is controversial, but when budgets are stretched it is vital that the public are part of the process for deciding how the commissioning budget will be spent. We must take people with us if they are to accept that resources are scarce.
I am delighted to say that our local group has a grant from the Department of Health to define what public involvement should look like. A successful meeting was held recently involving a wide range of stakeholders—that awful word—including patient voluntary organisations, special interest groups and representatives from the local involvement network, Southend and Essex hospitals and the community. It is expected from the initial meeting that an agreement will be reached on how the public can best be involved, both at strategic level and in making decisions about specific projects. One possible outcome involves forming a group of health champions who have received training on commissioned health services.
I will not take up any more of the House’s time, as it is not fair to the colleagues who are waiting to catch your eye, Mr Dobbin, but I say to my hon. Friend the Minister that it would be good for the Department of Health to take seriously any representations made by hon. Members for the great county of Essex.
Robert Halfon (Harlow) (Con)
I, too, congratulate my almost-neighbour and hon. Friend the Member for Witham (Priti Patel). She made an incredibly powerful case about the individual against the state and the powerlessness that people feel against state agencies, which is why we need to return power to the people. I thank her for securing this important debate. I am sorry that my hon. Friend the Member for Southend West (Mr Amess) has been to all the hospitals in Essex apart from Princess Alexandra hospital in Harlow. I strongly recommend it; it is a good place.
As has been mentioned, Essex is a large county, with five primary care trusts and more than 1.4 million people, which is roughly the same population as Northern Ireland’s. Some variation in such a large area is natural, but sadly, my constituency contains serious health inequalities, despite the best efforts of local staff and the Princess Alexandra hospital. Addressing them is not just about health and a stronger work force; to me, it is also about social justice.
I have three points. First, we suffer from significant health inequalities, as I said. Secondly, Harlow has a good hospital; it has its problems, but I strongly support its bid for foundation status. Thirdly, we have a history of funding problems, particularly in west Essex—I am glad to move from north Essex to west Essex—and they must be addressed.
On health inequalities, sadly, more men die from alcohol-related causes in Harlow than in any other district in Essex. The latest statistics show that there are 45 such deaths in Harlow every year, double the rate in nearby Uttlesford and about 50% more than the east of England average of 30 a year. I accept that Harlow is a major town, but families there are struggling with a particular problem, and the rate is higher than in similar towns in Essex such as Colchester and Basildon. Harlow also experiences some of the worst rates of child and adult obesity in Essex. Government statistics show that one in five 11-year-olds in Harlow is obese before leaving primary school. Some 55% of 15-year-olds in Essex drink alcohol, 19% are regular smokers and 13% use drugs, but the problem is particularly acute in Harlow. The rate of adult drug abuse in Essex is 4.8 per 1,000, but in Harlow it is nearly double, at 8.3 per 1,000.
I do not want to paint a negative picture of Harlow. I am proud of my town and constituency. There is some good news. Local faith and charitable groups are aware of the challenges and are responding to them. The organisation Open Road runs an SOS bus and does other anti-drug work, helping people access advice, information, support and more formal treatment if needed. Some other remarkable drug rehab charities do essential work behind the scenes. There are many walking groups, and I have been to a number of events organised by the Harlow athletics club, which is one of the most distinguished groups in the region. Projects such as Kickz work with young people, providing football, boxing and other fitness pursuits.
In that context, Princess Alexandra hospital has had problems, but hopefully it will become a foundation hospital. With a new chairman and chief executive, the hospital is making a strong bid for foundation status, which I support. I have found the chairman of the hospital, Mr Coteman, to be open, honest and straight-talking about the difficulties that we face in Harlow. He is also dedicated. On Christmas day, I visited the hospital wards with Harlow hospital radio and was astonished to see not only that the chairman was going around visiting patients, but that he had brought his whole family with him after travelling from Cambridge for the day. That shows a lot of commitment to the hospital.
It is not just Mr Coteman. I visited the cancer ward at Addison House with Robert Duncombe. The ward is very well run. We have talked a lot about waste and bureaucracy, and of course, we have those problems, but it is a completely different story at Addison House, where five staff share a small office, and when I say small, I mean really small.
The Princess Alexandra hospital is at the cutting edge of research, with its cellular pathology laboratories, for which I hope NHS support will continue. Having visited the laboratories, I know that the genius of their people and their technology is remarkable and bests anything in the private sector. However, the difficult environment means that the Princess Alexandra hospital needs the foundation status for which it has applied in order to take its work to the next level.
I want to touch upon the history of the funding problems in west Essex, which are all the more serious given the health inequalities that I have described. Under the previous Government, West Essex primary care trust struggled with the 20th worst deficit in the UK, and the black hole for 2009-10 was nearly £2 million. I welcome the coalition Government’s commitment to increase health spending in each year of this Parliament, but it is a question not only of getting the right resources, but of spending the money wisely.
When I was a parliamentary candidate, I found out, via a freedom of information request, about a £700,000 cut in funds to the NHS walk-in centre in Harlow. Finances had been mismanaged, so much of the investment was wasted. There have been serious problems with health management, as well as health inequalities, which we must address under the new ways of devolving purchasing power to GPs. I particularly welcome the pledge to remove strategic health authorities, because they seem to be a complete waste of resources and an unnecessary tier of bureaucracy. That money would be much better ploughed into the work of nurses, doctors and health visitors on the front line. I think that the Health Secretary said at the Conservative conference that managers have so far been cut by 2,000 and that front-line staff have been increased by 2,700. I am sure that the Minister will want to clarify that.
On NHS fuel and petrol allowances for workers, I was astonished to discover when I visited my mental health trust that NHS mental health professionals who use their cars all day for their work—this is not just about commuting, but about visiting patients—get tiny fuel allowances, some just 12p a mile. I have tried to investigate the issue, but there seems to be a spaghetti junction of authorities that decide what the rate is. It is unfair, when petrol is at £1.35 a litre, that their fuel allowances are so low. I urge that dedicated NHS professionals who use their cars all day for their work should get a decent fuel allowance.
We must deal with the health inequalities in Harlow. To coin a phrase, we must be tough on health problems, but tough on the causes of health problems, too. Ultimately, the evidence is that we need more early intervention and preventive work, but the cause of many health problems is social deprivation. It is jobs, a stronger economy, higher employment, and opportunity for the many and not the few that will give us a healthier society, which is why I welcome the Government’s economic reform, with lower taxes for lower earners and deficit reduction. It is about not just pure utilitarianism, but social justice.
We must do more. We need more partnerships with grass-roots community groups, such as the local Harlow branch of the Alzheimer’s Society and the Harlow athletics club, which I have mentioned. Hospitals should be the first, not the last resort, which is part of the problem that we face in the NHS today. To do that, resources must be directed towards prevention, and the best people at prevention are the small community and faith groups already in our estates, working with people. When we open up NHS contracts, we must make it easier for small charities and firms to bid for them, as well as the larger, “Tesco” charities. There is fear in some parts of my constituency that our health reforms will be monopolised by vast health conglomerates. I very much hope that we see more co-operatives. I understand that the PCT in Kingston has become a co-operative. If that is the case, I hope that it will be a model that other PCTs and GP commissioning bodies can follow.
I have always said that the big society will only work if we build the little society, too. We must bring real localism to our NHS. We have to give patients meaningful choice. Harlow struggled for years with top-down cuts under the previous Government. For example, the North Essex trust, which, as has been mentioned, supplies mental health services, suffered a £5.3 million cut in 2007.
Finally, why is it that whenever the previous Labour Government cut our services in Harlow, it was presented as a fact of financial management, but whenever the coalition Government are forced to cut spending, it is seen as an ideological outrage? That double standard must be addressed. I am glad that our NHS budget is guaranteed to rise in real terms every year in this Parliament, and hope sincerely that Harlow patients and residents will get their fair share. I look forward to the Minister’s forthcoming visit to Harlow to see for herself the NHS in operation.
Jim Dobbin (in the Chair)
Before I call the final speaker, I remind hon. Members that the wind-ups normally start at 10 past 12.
Jackie Doyle-Price (Thurrock) (Con)
Thank you, Mr Dobbin. Like my hon. Friends, I should like to congratulate my hon. Friend the Member for Witham (Priti Patel) on securing this debate and on giving an articulate exposition of the inherent tension between process and outcomes. I think that one thing that we are all looking forward to from the Government’s health reforms is a greater focus on achieving outcomes and rather less on the processes that she has outlined.
This issue is of great importance to my constituents in Thurrock. Frankly, considering recent years in particular, the performance of our local health services needs to be better. I pay tribute to the staff involved in the care and treatment of patients—they discharge their efforts with the best of intentions and commitment—but, as my hon. Friend the Member for Southend West (Mr Amess) has pointed out, what is often lacking in the health service is leadership. In south-west Essex in particular, poor management at a number of levels has resulted in too many people being failed and in local people’s confidence in the local health provision being too low. We all need to work hard to improve that and give people the health services they deserve.
I shall give some clear examples. My constituents rely on services provided by Basildon hospital, and the primary care trust responsible for delivering them is South West Essex PCT, which is currently implementing a severe programme of cuts, following a significant overspend. I shall deal with the hospital first, but as hon. Members will realise from my remarks, the ongoing issues at Basildon are interlinked with the overspend in the PCT. Dealing with that overspend will have implications for the hospital, too, so there is a great deal of uncertainty among my constituents, and a serious lack of confidence in local health services at present.
Basildon hospital has had a difficult recent history. In November 2009, the then Secretary of State, the right hon. Member for Leigh (Andy Burnham), made a statement in respect of Basildon hospital, following concerns about excessively high mortality rates there, which my hon. Friend the Member for Southend West will remember extremely well. The then Secretary of State said:
“There is still considerable variation in standards throughout the NHS, from one hospital to another, and in some cases the variation is unacceptably wide. That is the case in respect of Basildon and Thurrock University Hospitals NHS Foundation Trust.”—[Official Report, 30 November 2009; Vol. 501, c. 855.]
[Hywel Williams in the Chair]
Since that time and despite various programmes to tackle poor performance at the hospital, my constituents and I are concerned that such variation is unacceptably wide. The hospital management tell me that things are improving, but my postbag tells a very different story. Although many constituents report excellent treatment at the hands of the hospital, simply too many do not. As I say, week in and week out, there are reports in the local press of new things that have gone wrong. The impact on my constituents is that they simply do not have confidence in the hospital and they do not want to be treated there.
It is true to say that there has been some improvement since 2009 but, returning to the then Secretary of State’s statement, that has happened from a very low base. The Care Quality Commission continues to find that there are serious deficiencies in patient care. Most recently, the CQC’s February 2011 report states that of 16 measures taken into account, four needed action and six received suggestions for improvement. Criticisms include a lack of consistent nursing care, a failure to check that equipment is safe, the need for improvements to care for patients with dementia, and issues with poor nutrition and weight loss going unreported.
The hospital’s management are taking rather too much satisfaction from the improvements reported by the CQC. It does no one any good that the reputation of Basildon hospital remains so low. However, there is an opportunity to achieve real change. The current chairman is due to depart and I hope that the Minister will take steps to ensure that the opportunity is taken to provide some decisive leadership to the board, so that the real challenge to improve performance can be dealt with.
On the state of NHS South West Essex, many treatments have recently been cut by the PCT—including in vitro fertilisation—and restrictions have been put on cataract operations. As a Government, we have promised to protect the NHS budget from cuts and we have held to our promise. However, in south-west Essex, people just do not believe us because they are faced with a cost-cutting programme to fix a black hole of some £50 million. How did the PCT get into such a mess? In the past two years, it has taken on 100 extra backroom staff. Those people were not involved in front-line delivery; they were working in the PCT headquarters. The PCT also spent money building a community hospital in Brentwood that is far bigger than required. When I visited that hospital, I went around switching on lights in redundant facilities. That service was commissioned under the private finance initiative, so it will be an enduring cost to the NHS budget. It is a classic example of complete incompetence in managing the commissioning of a service.
A further reason for the overspend brings me back to what has happened with Basildon hospital and the impact that that is having on the wider health provision in south Essex. As confidence in Basildon fell, patients were desperate to be treated elsewhere, which meant that the PCT had to buy services from other hospitals in Essex, London and Kent. The hospital was faced with a loss to its income because of the decline in demand, and it dealt with that by routinely booking additional out-patient appointments in the knowledge that the PCT would pick up the bill. Such a situation added to the financial pressure.
No one has been held to account for the PCT’s overspend. Patients therefore perceive what has happened to be a direct result of the Government’s programme. I cannot emphasis enough that that is not the case. The responsibility for that overspend rests firmly with the PCT’s management. It is disappointing and bad for public confidence that no one has taken responsibility. Unless someone is held accountable, how can we ensure that our constituents regain confidence in the system and trust what we say? When we say that we are ring-fencing the NHS budget, that sounds pretty hollow to my constituents. I pay tribute to Andrew Pike, the newly appointed chief executive of the PCT. He has grasped the nettle and is making the necessary painful decisions to turn the situation around. The price of that is an accelerated programme of redundancies and carefully managed demand for services. That means patients are not getting seen as quickly as they would have done, and my constituents are not getting the same standard of service they would if they lived elsewhere. It also means that the new hospital planned for Grays is likely to be delayed as we fill the black hole, which will lead to much disappointment locally.
I look forward to hearing the Minister’s comments on those issues. Too often, poor performance in the NHS goes unchallenged. While ever-senior NHS managers continue to draw hefty salaries, the least we can expect is that when things go wrong, someone steps up to the plate and takes responsibility. It is galling for members of staff to receive redundancy notices when the people who are responsible for that overspend remain on the NHS payroll. I hope that the Minister will take action to improve accountability among senior management because that will go a long way towards rebuilding confidence.
Ms Diane Abbott (Hackney North and Stoke Newington) (Lab)
The hon. Member for Witham (Priti Patel) is to be congratulated on obtaining the debate. Many of my constituents move to Essex as a kind of upward trajectory, so I listened with great interest to what she had to say about a part of the world with which I am not as familiar as I probably should be. The week after the Lib Dems have turned savagely against the Conservative-led coalition’s health care policies—the British Medical Association is debating them today and, as we know, doctors are very worried about what is proposed—hon. Members will expect me to touch on the health reforms generally and how they will affect the people of Essex.
I listened with some sympathy to the complaints of the hon. Member for Witham about bureaucracy. As I have been a Member of Parliament for 20 years, I have tangled with more bureaucrats than I care to remember. However, I always like to stop short of sounding as if I am dismissing people who work for the health service as a whole. My mother was a nurse. She was one of that generation of West Indian women who helped to build the health service after the war. We have to remember that however frustrating it is as Members of Parliament or even as members of the community to deal with bureaucrats in the health service or elsewhere, there are thousands and thousands of people without whom the health service could not work or function. They will tell us that they have survived more reorganisations than they care to remember. They are still there, getting their heads down and trying to provide a service for our constituents.
The hon. Member for Witham made an important point about the proportion of elderly people in our population. We do not have time to deal with that matter fully, but people are living longer and they are suffering from ailments such as Alzheimer’s and other things. Elderly people make up an increasing proportion of the population. A few weeks ago, I went to a nursing conference and a senior nurse said to me that, when she was on the wards, the mean age of elderly patients was about 80. The mean age of elderly patients is now 90 or 100. Elderly people now pose very different problems from those that the elderly posed a few years ago. It is important that we consider the question of how we secure high-quality care—I am reminded of that awful ombudsman report that was published a few weeks ago—how we pay for it and how health care interconnects with the issues of public health and social care. I hope that we will have a chance to return to those matters.
I remind the hon. Lady that, despite her letters to bureaucrats and her undoubted frustrations on behalf of her constituents, when my party left office, satisfaction with the health service was the highest it has ever been. Hon. Members can say that the population was deluded on that, but I do not think that that is correct. We are talking about massive MORI polls. People’s satisfaction was higher than ever. There had also been massive levels of investment, not least in Essex. She will be aware of the new unit at Colchester general hospital, which includes an updated children’s ward. It is fully open and operational, and that £20 million project marks the biggest investment in the hospital’s facilities since it opened in 1985.
Apart from general frustration with bureaucracy, there are specific issues in relation to health care in Essex that are worth mentioning in this short debate. The hon. Lady mentioned Broomfield hospital. She will be aware that, just a few weeks ago, it was highlighted that although the hospital takes more than £1 million a year in car parking charges, its car parks still lose money because it is spending £1.2 million on running costs, including on CCTV, attendants and capital investment—they must be extremely well paid attendants. We also know that the hospital’s move into its £148 million PFI wing was delayed twice before finally opening in late 2010. The opening day was pushed back because staff were trapped in faulty lifts. We also know that the same hospital spent £400,000 on art for its new wing, which was commissioned as part of the development and funded through PFI. PFI is expensive enough—we may debate that at another time. To spend the money on art, when we know how ridiculously expensive PFI can be, seems quite strange.
There have been all sorts of care warnings about hospitals in Essex, such as Queen’s hospital in Romford. We know that the Romford project will be the first of a number of pilot reviews of PFI contracts to see if the costs can be brought down, and anyone who cares about the health service must welcome that. We know that the Braintree community hospital has defended itself after paying out nearly £20 million in damages for clinical negligence. If we are focusing on bureaucracy, we have to focus on how those things happen. We know that the Southend University Hospital NHS Foundation Trust, with which hon. Members will be familiar, has had to respond to concerns about safety, which were raised by the Care Quality Commission. We know that the West Essex primary care trust risks not being able to give an 18-week referral-to-treatment time. We know that NHS South West Essex has a very large overspend—its deficit has been improved, but it still has an overspend—in relation not to bureaucrats, but to acute hospital activity.
We also know, which I find alarming, that the Basildon and Thurrock University Hospitals NHS Foundation Trust is now trying to make savings by allowing waiting lists to extend. That implies a 14-week wait on first appointment, which is why an hon. Member on the Government side said that, when ordinary residents and voters are told that money on the health service is being ring-fenced, it rings rather hollow. Up and down the country, not just in Essex, they can see waiting times lengthening, and new hospitals and new health care facilities that have been promised being delayed. It is for the Government, who have made much of their protection of health care spending, to explain that. The real issue is this. The hon. Member for Witham spoke glowingly about the reforms, but sadly I have news for her. She seems to believe that those reforms will help with the issues that she has raised. As she would know, however, if she had followed the Health Committee, there is a real challenge involved in trying to introduce those reforms, whatever we think of them, while at the same trying to achieve unprecedented savings in health care. The Health Committee doubts whether that can be done.
No one argues with the notion that GPs could have a lot to offer in the commissioning of care, but as the president of the Royal College of General Practitioners has said, there are other ways to do that without subjecting the health service to a top-down reorganisation. I do not want to be unpleasant, but the Government promised, all through their time in opposition, that they would not subject the health service to any top-down reorganisations.
Ms Abbott
Time is against me, because I want to give the Minister plenty of time to respond. That is what we were promised—no more top-down reorganisations. As for waste of money, one problem with letting all those PCT bureaucrats go is that they have to be paid redundancy. The hon. Lady said that she hopes that they will not be paid big redundancy packages. I am afraid that they will be, and many will be re-employed. GPs will be less accountable to patients and the danger that many people, including GPs, see is that the big American health maintenance organisations will be able to get inside and act as commissioners for GPs, who, after all, joined the health service to heal and not to be managers.
I feel sorry for Government Back Benchers. They believe that the issues that they find so challenging about bureaucracy, cuts and patient accountability will be solved by the reorganisation. I can say with complete confidence that, if anything, the reorganisation, which is too fast and at the wrong time, will make those problems worse. It gives me no pleasure to say that, but anyone who has analysed the so-called reforms can see that they are a car crash in slow motion.
The Parliamentary Under-Secretary of State for Health (Anne Milton)
It is a pleasure to serve under your chairmanship, Mr Williams. I do not believe that I have had the pleasure before. I congratulate my hon. Friend the Member for Witham (Priti Patel) on securing the debate. The fact that she has attracted so many of her fellow Essex MPs is a testament to the importance of the issue. The health services in any MP’s constituency are always of major concern and it is fantastic to have an opportunity to raise some of those issues in the Chamber.
I must add to the comments made about the staff in the NHS. The staff in Witham, and across Essex, should be congratulated on their work. I trained as a nurse, like the mother of the hon. Member for Hackney North and Stoke Newington (Ms Abbott), and worked in the NHS for 25 years. I understand, therefore, some of the complexities of their job, and their dedication and expertise in driving benefits for my hon. Friend’s constituents on a daily basis is valued greatly. As a Government, we want to ensure that we support all staff and give them the framework to provide the highest standards of care for everybody they treat.
Before I go further, the hon. Member for Hackney North and Stoke Newington need not feel sorry for Government Back Benchers at all. She does them a disservice by suggesting that they do not see the reforms for what they are. They are an opportunity, for the first time, to bring patients and their clinicians closer together in shaping the services that they need. She is right to say that the previous Government put untold investment into the NHS. Spending on health doubled, if not more, in the time that they were in government. It is important to realise, however, that just chucking money at services does not mean that they will get better—we need to have value for money. Taxpayers expect and deserve that, and for every pound of taxpayers’ money that goes in, £1-worth of services needs to come out at the other end, and that is central to the debate.
We have set out proposals to free the NHS from bureaucracy and central control. My hon. Friend the Member for Witham eloquently set out her concerns, as did a number of other hon. Members, about those levels of bureaucracy and about her constituents receiving the health care that they need, with the choices that they want and with the highest standards that they deserve. Like all members of the public, we want to end the overbearing top-down oppression and give front-line professionals the freedom to innovate and make decisions based on their clinical judgment and the needs of their patients, rather than centrally dictated, process-driven targets that have dogged the NHS in the past 13 years.
Responsibility for budgets and commissioning care will transfer from bureaucrats to consortia of clinicians, so that we can drive up the very highest standards of health care and achieve the highest outcomes that are specific to local communities. My hon. Friend the Member for Harlow (Robert Halfon) raised the issue of inequalities in health. It is critical to have outcomes that are consistent for everybody, not just a few, and a much simplified system—without two layers of management, the strategic health authorities and PCTs—which is, actually, reorganised in a way that is less top-down and more bottom-up. Why are we doing that now? Now is the time to do that, because now is the time that we are determined to drive down the overall administrative costs to the NHS, and achieve a better dialogue and partnerships with health and care professionals in all sectors.
Pathfinder consortia are now in place across all five Essex PCTs, involving a total of 146 practices and serving a population of almost 1 million people. The Essex commissioning consortia pathfinder in the area of my hon. Friend the Member for Witham consists of seven practices and serves a population of 70,000—debates are often an opportunity to demonstrate that we know all about the figures. I understand that the Witham practices are in negotiations about forming a mid-Essex consortium.
My hon. Friend the Member for Southend West (Mr Amess) raised a point on funding. As part of our desire to improve the standard of NHS care up and down the country, we are consistently increasing the amount of money that we provide. Total revenue investment in the NHS in 2011-12 will grow to more than £102 billion a year. The allocations announced on 15 December will provide PCTs with £89 billion to spend on the local front-line services that matter most—that is an overall increase of £2.6 billion, or 3%. Of that, Essex will receive £519.6 million, which is a cash increase of 3.2% above the national average. From 2013-14, the NHS commissioning board will allocate the majority of NHS resources to consortia, and funding will be arranged so that every area gets its fair allocation, based on the burden of disease and disability, which, again, is a point that my hon. Friend raised. Details of that will be announced shortly.
My hon. Friend the Member for Witham discussed population growth and demographics, and the pressures that they will bring to bear. I am pleased that the county council is taking a proactive approach—that is the thing to do—to get ahead of the game and make improvements to public health. With an ageing population, it is critical that people stay healthier for longer.
On redundancy and staff, there is, in fact, a great deal of natural wastage in the NHS already, and there are schemes such as the mutually agreed resignation scheme, which is intended to help the process. To some extent, redundancy is dictated by legislation and locally agreed terms and conditions of service. Some good staff will move on to assist the consortia.
The clusters that my hon. Friend spoke about are an important part of the transition, gradually moving upwards through the PCT organisation. The new consortia come in at the bottom. I suggest that she arrange monthly meetings with the PCT because, clearly, there are many issues that she wants to raise, in particular individual cases. She discussed the problems of Mr Shipton and Mr Cross not receiving Sativex. Of course, that will change when we have consortia, and clinicians make commissioning decisions. That will change things, and it will increase the opportunities for patients and their families to affect decisions.
My hon. Friend spoke about the case of Mrs Wetherilt, which sounds absolutely dreadful—no one should have to battle away like that—and she has raised the case of Bethanie on several occasions with the PCT. I do not know the details of it, and, as she recognises, I cannot intervene, but it is important that systems work for people who have complex needs or diagnoses. It is critical that we get that right.
On that point, I know that my hon. Friend the Member for Braintree (Mr Newmark) would have liked to mention the new community hospital in Braintree. It is a good example of a community hospital that serves the local community, which is what people want. I know that he campaigned long before the present Parliament on getting the right services for pregnant women who need maternity care.
My hon. Friend the Member for Southend West has a long and distinguished career on the Health Committee. I could say that I learned everything I know at his knee. Having sat on the relevant Bill Committee, his frustration over the formation of the PCTs must at times be unbearable. Being a prophet of the unwelcome consequences of legislation is not necessarily any comfort, albeit it is to his credit. His comments about leadership are so important, and it is not just clinical leadership but leadership across the board. Something that does not often get a mention is political leadership. Politicians and people in government have to be clear, when they are talking about health services, that nothing but the highest standards and quality of care will do. We have to keep saying that and be unrepentant about doing so. What the Government can do is set the right framework and outcomes. We get what we ask for, and if we ask people to wait more than four hours in accident and emergency, that is what we will get. Whether or not that is measured does not necessarily determine whether anyone gets better. Therefore, the Government have to be clear about exactly what they want, and not chase headlines.
Linear accelerators: does not everyone want one? Everyone would like a linear accelerator. However, my hon. Friend the Member for Southend West is right in saying that we have to take the public with us when we make such decisions. “Consultation process” is a hackneyed phrase now. I do not think that anyone has much confidence in consultation processes. What we have to do, and what I feel we will be able to do through the health and well-being boards and the involvement of local authorities, is get a real and democratic voice for local people. I share my hon. Friend’s dislike of the term “stakeholder”. We are taxpayers; it is our money.
My hon. Friend the Member for Harlow discussed inequalities, and was right to say that they are a matter of social justice. For instance, it is outrageous that in Westminster there is a 17-year difference in mortality: people born in some parts of Westminster may live 17 years less than those born elsewhere in the borough—that is truly shocking.
My hon. Friend raised the issues of alcohol-related deaths and obesity, and discussed the fantastic work done by many local organisations. Again, health and well-being boards will be an opportunity to put public health right at the heart of local authorities, which have a long and proud history of improvements in public health and bringing together all the organisations that do so much.
My hon. Friend was also right to say that there is tremendous social capital in our communities. In my travels around the country—I try to get out a lot, for fear someone might say that I do not get out enough—I have been fascinated to find in some of the most deprived areas the greatest social capital, innovation and response from local communities to do something about their problems. They want a way out of poor health outcomes and the crime in their area, and their resourcefulness is outstanding.
My hon. Friend the Member for Thurrock (Jackie Doyle-Price) discussed variations between Thurrock and Basildon. She was right to say that they are completely unacceptable. We cannot interfere from the centre with appointments, but she was right to reiterate the need for first-class leadership, and it was good to hear her positive comments about the new chief executive. The organisations around the country that do well have good leadership, and it is not about driving a coach and horses through something, which is what I fear the previous Government tried to do. They tried to dictate from the centre and tell people what to do. Actually, what good leaders need is inspiration and enthusiasm. They need to gather people up along the way and have a clear vision of what everyone is working towards. Such skills are hard to define, but we recognise them when we see them. I hope that Essex will get the leadership that it clearly deserves, and for which all Members of Parliament in that area have been fighting.
I agree 100% with my hon. Friend on getting accountability right. As a constituency MP who has a PCT with one of the worst financial records in the country, I know that, sadly, it is the public who suffer as a result of poor management. We are determined to get accountability right. Again, that comes to setting the right outcomes.
I believe that GP consortia, health and well-being boards and public health in local authorities will result in the kind of joined-up planning that all Essex Members want, and that we will see the improvements in health care services and public health that we want. I have outlined some of the ways in which we intend to transform the delivery of services and ensure that, in the transition from the old system to the next one, we get a patient voice that is loud and clear, and that patients get the services and the care that they need and deserve.
Richard Lee Primary School
(13 years, 1 month ago)
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Mr Bob Ainsworth (Coventry North East) (Lab)
Thank you for calling me, Mr Williams, and for presiding over this debate. The Richard Lee primary school in my constituency is a 1950s Hills-system-built school. It is built of reinforced concrete and high-alumina cement, and it has simply come to the end of its design life. Its rebuilding was repeatedly delayed because of needs arising from rising rolls in Coventry and demand for new-build schools, but it was due to be rebuilt in 2009. As a result of the collapse of another school in Coventry, that rebuild was further delayed.
The devolved capital budget for the Richard Lee primary school last year was £49,150, £40,000 of which was spent on essential repairs and maintenance, leaving practically nothing for any development within the school, any enhancements or any improvements. This year, that devolved capital money has been reduced to £9,439. The main problem with the Richard Lee school, according to the head teacher, is that it badly needs a new roof. It simply cannot be patched any more. There are patches on patches, it is coming apart, and water is ingressing the school in many places. Even if a new roof were possible with the school’s construction, it would cost in the order of £500,000.
The school needs a new boiler, and has had to close twice in recent months because the boiler has failed, but the cost would be £40,000. The windows, which form entire walls in many of the classrooms, are being pulled apart by the strains on an ageing building. As a result, they are draughty, cannot be secured, and are sometimes sealed with curtains and pieces of cloth to make the classroom environment something like bearable. A quote for replacement windows is of the order of £110,000.
Six toilet blocks are in need of refurbishment at a cost of £7,000 a block. There are awful smells and regular flooding from blockages. Despite £15,000 being spent to sort out the drains, that did not solve the problem in its entirety, and on one occasion sewage flowed freely across the school car park. There is rising damp in classrooms. They are being recarpeted and retiled regularly, but children cannot sit on the floor for story times or anything else without sitting in wet.
There is a lot of asbestos throughout the school, and although it is safe in its undisturbed state, the cost of any repairs is considerably higher than it would otherwise be. Because capital funding is being spent on repairs and maintenance, second-hand furniture is regularly bought from other schools that manage to obtain new equipment through their budgets.
The Minister and the Government claim to be interested in the big society and believe that organisations other than the Government should make a contribution to the maintenance of services that people need. The school is pretty good at tapping into local organisations and scrounging money. Local firms, such as E.ON, Jaguar Land Rover, the Prince’s Trust and local church groups, have all helped by painting and decorating parts of the inside and outside of the school. When I visited it recently, there was evidence in two separate classrooms of teachers painting the walls having bought paint to decorate their own homes.
A burst water heater resulted in reception children being taught in the corridor for more than six weeks while attempts were made to dry out the classrooms and lay new flooring. The children returned to their classrooms in February, after the half-term break, but sadly the new flooring is already beginning to lift because of damp and will have to be removed again during the Easter break. I hope that this time it will be refloored satisfactorily.
The education welfare officer, who monitors attendance weekly, is worried about the number of absences through illness. With 4.5% of pupils absent, she believes that those genuine absences are due in part to the cold, damp conditions that the children must endure in many of the classrooms. The school does not comply with disability discrimination legislation. It has seven flights of stairs inside and four outside. They cannot, without huge expense, be adapted with ramps or lifts because of the nature of the building.
The council is so worried about the state of the school that, in May last year, it commissioned a technical report to see what needed to be done, whether the school was safe, and what the options were for keeping the school open and viable. A technical report by Martech Technical Services Ltd said that for the time being the school is safe, despite evidence of carbonisation of the cement, and therefore the beginning of corrosion of the steel reinforcement of the concrete structure, and that it could have its life extended for 10 years, but that the costs would be considerable. A simple 10-year extension of the school’s life would require concrete repair costing about £20,000, corrosion inhibitor costing about £40,000, anti-carbonisation coatings costing about £30,000, a new roof, which the head put at £500,000 and Martech put at £450,000, and preliminaries costing about £90,000. It gave no figures for contingencies such as removal and replacement of ceilings, asbestos removal, access and internal redecoration. I put those figures to the Minister in the light of the school’s capital programme of £9,439 a year.
As I was going through what I would read out from the report, I was worried that the Minister would think that I am exaggerating the difficulties, so would he be prepared to visit the school? I have been in politics for a long time, and I am rarely surprised by what I see. Nevertheless, a visit to this school is shocking. It is a good school and its recent Ofsted report—received only yesterday—stated that there have been considerable improvements, that the school is well led with an engaged and supportive governing body and that the teaching staff have made significant efforts to improve the output of the school. Ofsted is not obliged or encouraged to talk about school buildings, as that is not part of its job. In this case, however, the Ofsted report did comment on the state of the building and the impact that that was having on the school.
What on earth is the school to do with £9,400? The council is desperate to include a rebuild of the school in its capital programme, but the uncertainty about that programme, and the diminished resources that it has for the whole school estate in Coventry means that it is worried about committing to technical appraisals and the architectural work that would be needed. It does not know whether the rebuild money is likely to be forthcoming in the near future, and such technical work would take a big slice of the Coventry capital programme. I would like the council to go ahead with the necessary preliminary planning work so that the school can be rebuilt at the earliest opportunity. I do not believe that extending the life of the school is in any way viable, but the council needs reassurance about its future capital programme before it makes a considerable outlay at the expense of other school needs in the city.
I do not know whether the Minister can provide any comfort with regard to plans for the future. The Secretary of State talked about the varying needs of primary schools, perhaps as part of moves to excuse his decisions on the Building Schools for the Future programme. He said that there were other needs, and that it was not only about secondary schools. Having reached this situation, however, there is no alternative for Richard Lee primary school other than a total rebuild, even though, as the Minister knows, that will be expensive and in the order of £8 million.
If the Minister believes that I am in some way exaggerating the difficulties faced by the school, I ask him to come and have a look. I am sure that he will be as shocked as I was by the state of the school buildings. If he cannot find time to visit, perhaps he would be prepared to meet a delegation so that some of the dedicated governors and teaching staff can meet him, and he can see in detail some of the things that I have seen. Most of all, may we have clarity about future funding programmes so that the council can make a commitment to what is needed? Even if we have a programme now, it will be 2013-14 at the earliest before a new school can be provided.
Having got through this winter, I frankly do not know how the school will get through next winter, and I am certain that it will not be able to do so with a capital programme of £9,000. The degree of patching and mending evident at the end of this winter is far more than the school’s resources can cope with. Good people are providing a good education to children in my constituency, but they are being undermined by the appalling state of the buildings in which they are asked to work.
The Parliamentary Under-Secretary of State for Education (Tim Loughton)
I congratulate the right hon. Member for Coventry North East (Mr Ainsworth) on securing this debate and on raising an issue of concern in his constituency. I do not know whether this is the first time he has secured a debate in this Chamber, free from the constraints of being a Minister; I know how frustrating it can be as a Minister that one does not get the opportunity to air important constituency matters. However, the right hon. Gentleman has certainly aired one such matter today very graphically, and I appreciate the concern that must be felt by him, by parents and by teachers regarding the state of the school that he described.
The Minister responsible for schools, my hon. Friend the Member for Bognor Regis and Littlehampton (Mr Gibb), is unfortunately detained with Committee work today, but I will pass on the request for him to visit that school if he is in Coventry, or to meet a delegation. I know that he has campaigned on behalf of schools in the past, and that he is a strong advocate for improving provision for all pupils, teachers and parents.
As the right hon. Member for Coventry North East knows, improving provision is a priority that the Government share. Even in times of austerity, we are determined to make this country’s education system among the best in the world by ensuring that schools prepare every pupil for success. I congratulate Richard Lee primary school on the comments it received in the recent Ofsted report. The dedication of the teaching staff and those signs of improvement are doubly to be congratulated because of the challenging physical circumstances involved.
Our ambition is based on the simple but profoundly important principles of giving teachers and heads greater freedom, giving parents greater choice, providing higher standards for pupils, and reducing the amount of red tape in the system. We have taken steps to achieve those aims. The academies programme has been expanded, and we are now looking at the national curriculum with the intention of restoring it to its intended purpose—a minimum core entitlement beyond which teachers can tailor their tuition to meet the particular needs of pupils. By February 2011, the Department for Education had received 323 proposals to set up free schools, and that initiative is progressing. Through such changes, each local area will have a good mix of provision, and parents will have real choices for their children.
As the right hon. Gentleman persuasively argues, school buildings, teaching staff and pupils need to be a continuing part of the investment, and the coalition Government are committed to ensuring that that remains the case. However, we are faced with exceptionally tough circumstances. The appalling economic and financial inheritance left by the previous Government, of whom the right hon. Gentleman was a member, is one of those obstacles. The amount that the Government currently spend on debt interest payments could be used to rebuild or refurbish about 20 primary schools such as Robert Lee every day. We urgently need to reduce the deficit, and the previous Government knew that. They had already set a target of a 50% reduction in Government infrastructure expenditure by 2014-15, but they failed to admit that an impact on school building would be inevitable after such a reduction. Although I recognise the parlous state the school is in, it is not something that happened over the past nine or 10 months. The situation has been in decline for some time, and there were opportunities to address it in the past.
The underlying financial position was not the only element that the previous Government chose to ignore. Since four-year-olds are too heavy for storks to transport, there is generally four years’ notice of a child’s need for a primary school place. A small part of the pressure on places arises from migration and immigration, but the birth rate has been rising since 2002, levelling off for a couple of years from 2007.
Two years ago, Members of the then Opposition highlighted the increasing need for primary school places in a debate in this Chamber. On 3 March 2009, my hon. Friend the Member for Kingston and Surbiton (Mr Davey), now the Minister responsible for employment relations, consumer and postal affairs, led a debate on the need for primary school places in London. My hon. Friend the Member for Bognor Regis, now the schools Minister, and my hon. Friend the Member for Brent Central (Sarah Teather), now the Minister responsible for children, also took part. All speakers underlined the need for action to ensure that there are enough school places for the children who need them, and although the debate focused on London, the issue has spread beyond the capital.
Making sure that there are enough places in schools is fundamental; it is the most basic need of the school system. Nevertheless, the Government of the day chose not to treat the matter with the seriousness it required. Instead of tackling the need to which my hon. Friends drew attention, the Government proceeded with their unaffordable and inefficient Building Schools for the Future programme, announcing the entry of new authorities to that programme on 15 July 2009, and last year on 8 March and 5 April, just before the general election.
However, I must be fair to the previous Government. They were not the only ones who failed to respond to rising birth rates and the impending pressure on school places. Local authorities have statutory responsibility for ensuring that there is a school place for every child who needs one, and several authorities have been slow to respond to the emerging evidence of pressure on school places.
As well as being responsible for ensuring that there are enough school places, local authorities are responsible for ensuring that schools such as Richard Lee primary school are kept in good condition. Clearly, that is a particularly big challenge in this case. Schools shoulder some of that responsibility through the delegation of school management to the schools themselves. The central Government capital grant is intended to help, but the maintenance of premises is one of the purposes of revenue budgets. The revenue budget for the 484 pupils of Richard Lee school in 2010-11 was more than £1.5 million, which averages about £80,000 for every 25 pupils—an average class size. Freedoms for schools entail responsibilities and, for every school, those responsibilities include a share of the maintenance responsibility.
However, none of that improves the situation of the pupils of Richard Lee school, some of whom have been having lessons in conditions that no one would regard as satisfactory, as the right hon. Member for Coventry North East rightly highlighted. I was relieved to learn that all the classes are now at least taking place in classrooms. I understand that, as he said, for a spell after the boiler burst, some classes were taking place in corridors, which is completely unsatisfactory.
We are taking a number of urgent and decisive steps to tackle school building needs. First, we have put a stop to the bloated and misdirected Building Schools for the Future programme, because we recognise, as the right hon. Gentleman’s party did not, that the top priorities for investment in school buildings have to be ensuring enough school places and tackling poor building condition—precisely the needs that Richard Lee primary school embodies. Through the work of the capital review that Sebastian James is leading for us, we are developing ways of managing capital that will be more efficient and give better value for the funds spent. We expect the review to report in the next few weeks.
In the announcement of 13 December, £13.4 million was allocated to Coventry city council and its schools for capital investment in Coventry schools in 2011-12. We expect similar levels of funding to be allocated from 2012-13 to 2014-15. The allocation forms part of a national allocation for Department for Education capital of £15.8 billion during the four years from April this year to March 2015. To put that in perspective, the figure for 2014-15 is 60% below the historic high of 2010-11, but the average annual capital budget during the four-year period will be much higher than the average annual capital budget in the 1997-98 to 2004-05 period.
Within the allocations, basic need and maintenance are the areas to which we are giving priority. For 2011-12, the grant to Coventry for new pupil places is £6.5 million and the maintenance allocations come to £5.8 million. It is now up to Coventry city council to decide its priorities for the available funding, having regard to the building needs of the schools in the city and in line with its statutory duties and local priorities.
Mr Ainsworth
I seek clarification. I want to make the Minister aware that there are four Hills system schools in the city, two of which are in my constituency. The school that we are discussing is but one of them. He appears to have just talked about a capital allocation for Coventry that in total is about £13 million. He knows that a rebuild of Richard Lee in itself would take about £8 million of that city-wide £13 million pot, leaving practically nothing for distribution to the rest of the city. Is that figure to remain the same, and is my understanding correct that he said we would have clarity on the capital budget within the next few weeks?
Tim Loughton
The right hon. Gentleman knows that if we had more money from Building Schools for the Future—if money had been spent much more efficiently on the schools that were built at that time—more money would have been left over in the budget to spend on primary schools that are in a parlous state. I did say that the Sebastian James review will report in the next few weeks—imminently—about how we will approach capital spend in the future. I hope that the right hon. Gentleman will be able to take some clarity from that.
The situation is not easy. As I have said, we are in very tight budgetary circumstances, but I entirely recognise the particularly harsh circumstances in which Richard Lee primary school finds itself physically at the moment. I gather that Richard Lee was included in Coventry city council’s original primary strategy for change submitted in 2008 as part of the city council’s primary capital programme. Work on the school was to be a new build project, with an estimated budget cost of £8 million, as the right hon. Gentleman said.
However, the school was not subsequently prioritised in the council’s primary capital programme. That was a matter for the council. Instead, another school was deemed a higher priority due to its condition and the need to address additional pupil numbers. One might wonder about the state that school must have been in compared with the school to which the right hon. Gentleman is referring.
The primary capital programme will not continue beyond the current comprehensive spending review term. Therefore, there will be no opportunity of funding for the school through that route. However, I understand that Richard Lee school is now the council’s top priority for capital investment when funding can be identified.
We know that there are schools, such as Richard Lee, in need of refurbishment that missed out in previous Government capital programmes, and people feel that they have therefore been treated unfairly. We are determined to continue to invest in the school estate overall. It is for local authorities to determine their priorities locally. As I have said, the average annual capital budget during the period will be higher than the average annual capital budget in the 1997-98 to 2004-05 period. However, I recognise that in the short term it will be difficult for schools to adjust to reduced capital funding.
We will introduce a new approach to capital allocation, which will prioritise ensuring enough places and addressing poor conditions as quickly as we can. That model will be outlined in the capital review, which, as I said, will report in the next few weeks. Within the funding available to us, our intention is that the new model will prioritise areas that are experiencing high pressure to increase the number of school places and those with buildings in most need of repair, as would appear to be the case for Richard Lee school.
We are determined to ensure that money is spent on school infrastructure and the buildings themselves, not on bureaucracy and processes, which have claimed too much of the funding in the past. Even when funding is tight, it is essential that buildings and equipment are properly maintained to ensure that health and safety standards are met and to prevent a backlog of decay that is expensive to address. Clearly, the patching of patches that the right hon. Gentleman mentioned is not the most effective way of spending resources.
By stopping Building Schools for the Future projects that were not contractually committed, we have been able to allocate £1.337 billion for capital maintenance for schools, with more than £1 billion being allocated for local areas to prioritise maintenance needs. In addition, £195 million will be allocated directly to schools for their own use. We have also allocated £800 million for basic needs in 2011-12, which is twice the previous annual level of support. We expect similar levels of funding to be allocated from 2012-13 until 2014-15. The capital allocation for this year for Coventry city council and its schools was announced on 13 December, as I said. It is now up to the council to decide how it prioritises its local spending.
I entirely appreciate the right hon. Gentleman’s very genuine and clear frustration with the state of that primary school in his constituency. I repeat my congratulations and thanks to the staff and governors for the job that they are doing in very adverse circumstances. We are determined that in future what reduced moneys there are for capital spend will be targeted at those most in need, in terms both of the condition of the fabric of buildings and ensuring that sufficient places are available, given rising school rolls. I hope that the right hon. Gentleman will be able to see from the results of the James review, coming out soon, how we intend to achieve that, so that there may be some renewed hope for his school—now at the top of Coventry’s priorities—to get a better settlement in the future to deal with the problems that it clearly has. I will pass on his request for a visit or for a meeting with a delegation to the Minister of State, Department for Education, my hon. Friend the Member for Bognor Regis and Littlehampton, who is responsible for schools. Once again, I congratulate the right hon. Gentleman on having raised the subject today.
New Homes Bonus
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George Hollingbery (Meon Valley) (Con)
It a pleasure to serve under your chairmanship, Mr Williams. I welcome the Minister to the debate and I am glad to see him almost in his seat.
I spent 11 years as a district councillor in a local planning authority. As many colleagues will know, being a local councillor is a frustrating affair, but never more so than when it comes to the provision of housing for local people. Many obstacles are set in the way of local councillors, and there is often great hostility. With huge numbers of people on the housing waiting list, I wished we had been able to get to grips with the issue better.
Regional spatial strategies provided for local plans and core strategies to include more houses. That was a valuable stick, which ensured that many authorities made plans for homes, when they might not otherwise have done so. However, the inclusion of houses in local plans and local development framework core strategies was almost always achieved in the teeth of fierce resistance from local people. A great many houses were planned but never built, and that is a key issue, which we need to confront. Plenty of areas did not have regional spatial strategies; indeed, in my time, the south-west still had not put even the bare bones of a spatial strategy in place.
Most important, however, the strategies removed the need for local councillors to think about the merits or demerits of increasing local housing. They could simply hide behind the Government’s skirts and say, “It is all that nasty Government’s fault that new houses have come to your area.” They never needed to confront local people or hostile sections of communities about why increasing local housing provision was a good thing. Quite simply, that infantilised councils. Furthermore, the arrangements gave a huge advantage to those who opposed the plans. One thing follows the other; if a positive argument is not made for increasing local housing, it is hardly surprising that the most extreme views on the other side win the day.
I therefore greatly welcomed the Conservative party’s publication two or three years ago of its Green Paper “Open Source Planning”. It talked about a huge change of emphasis in our approach to planning. We were going to consult much more deeply with local communities, about not just the houses themselves but the reasons why they might be required. We were going to acknowledge that people lost amenity when large amounts of housing were built. We were going to provide a carrot, which we now know as the new homes bonus, to compensate local people in some way for the fact that they would have problems when the new houses came along. That was good common sense.
I already knew at that stage that deep consultation was absolutely necessary. In the Winchester district, we had the courage to act ourselves. We went out into the community and consulted widely. We sat down with large groups of local people, ran workshops and tried carefully to explain why we wished to build more homes. As a result, we found that we could persuade people. If we took the arguments out there and set them out rationally, people would listen; they would accept more housing if they could see why it benefited their communities. We received 3,000 separate responses to the consultation, including nearly 50,000 separate comments. That just goes to show that we really can engage communities if we wish to. That change—consultation, getting together with communities and deciding with them what they need for their areas—forms the principle plank of the proposed changes.
Neighbourhood planning empowers local communities to shape their own responses to their population’s needs, as set out by their local councillors, and councillors have to make that case persuasively. That is all well and fine, but where does the new homes bonus fit in? As I said, the issue is loss of amenity, which is slightly difficult to quantify. Most of the benefits that people think about when we talk about new homes are in the realm of public goods. For example, new homes might provide the critical mass for the local shop, ensure the continuation of the local school or reduce out-commuting in search of local employment. All those things are persuasive, and it is difficult to relate them to the fact that people will be stuck in more traffic when they go to work or might find it more difficult to see the local doctor. However, many individual households will see little, if any, direct benefit from the fact that new houses are going up.
Why not soften that blow, therefore, with a contribution towards whatever the community wishes to spend its money on? That is the right way to move things forward. Indeed, why not go further? There has been lots of criticism, certainly from members of the Select Committee on Communities and Local Government, that such an approach somehow involves bribery and that it is a bad idea for money to change hands in the planning system. I understand that argument, and I see where people are coming from, but if people suffer a direct loss of amenity and see their lives somewhat devalued, is there anything wrong with making a payment to them or reducing the amount of council tax they pay for several years? I think not. If people see that the authorities understand that they are genuinely losing something, even if only for a brief period, as a result of new homes coming along, we can responsibly make payments in kind to them.
For that very reason, it is incredibly important that all proposals for the new homes bonus include the assumption that spending should be very local to where the development happens. That leads me to my first question to the Minister. What about the 80:20 split in two-tier areas? Why does a county council need to have a share if compensating local people is the primary objective?
Mark Pawsey (Rugby) (Con)
I congratulate my hon. Friend on introducing such an important debate. The 80:20 split is of great concern to Rugby borough council, which argues that it has taken forward the proposals for the new housing from which Rugby will benefit. It is concerned that a proportion of the new homes bonus will be allocated to the county council, which will benefit from development under the section 106 agreement and the community infrastructure levy. I hope that the Minister will give us a little more detail about where this 80:20 split comes from. I note from the responses to the consultation that it is a starting point for negotiation, but those who represent the authority in my area would be interested to understand a little more about where the split comes from and where it is likely to end up.
George Hollingbery
I thank my hon. Friend for that timely intervention. I absolutely agree with what he says. In a moment or two, I want to develop this argument a little further, because there is some confusion about where infrastructure comes from.
Graham Jones (Hyndburn) (Lab)
It is a pleasure to serve under you, Mr Williams. My area is in a two-tier district. Does the hon. Gentleman accept that the funding for the new homes bonus comes from reductions in the formula grant, which affect the county council? According to the hon. Gentleman’s argument, the reduction in Lancashire county council’s formula grant will be redistributed only to the district authorities, which, in my area, is Hyndburn borough council. Does he not accept that that argument is flawed and that the Minister should not adjust the formula grants for shire authorities if they will not receive any of the bonus at the end of the year?
George Hollingbery
I thank the hon. Gentleman for his intervention. He makes some cogent points, which the Minister will want to respond to in a moment.
There is a danger here. We are clearly channelling payments down to a community for its loss of amenity, but it is dangerous for us to confuse that with the provision of infrastructure. Let me develop that argument a little more. Page 11 of “New Homes Bonus: final scheme design” states:
“Local authorities will have flexibility on how to spend the unringfenced grant…In many cases this will involve advanced planning with other local service providers to ensure that there is timely delivery of infrastructure for the new development. For example, local authorities can pool funding to deliver infrastructure.”
I hope that that will not be read as an invitation to spend the new homes bonus on infrastructure that would be provided by the community infrastructure levy or other agencies in any event. There is a dangerous blurring of the margins here, and I seek some reassurance from the Minister that the new homes bonus will be focused on local communities.
There is a further confusion. The community infrastructure levy is coming through. Section 106 will be narrowed to deal only with site-specific issues. On top of that, there is open spaces funding—I think it will still exist, although I am not 100% certain—and the new homes bonus. There will, therefore, be three potential ways of providing infrastructure, and I would like some reassurance from the Minister on the potential confusion about them. I have had evidence on the issue from local parishes in my area, and particularly from West Meon parish council, which I met recently. Its members were very confused about where open spaces funding would sit in the new matrix.
Just yesterday I received a letter from Hampshire county council, which is particularly worried about the timing of the community infrastructure levy. It says:
“We believe the arbitrary date of April 2014 will cause serious problems both for ourselves and the district councils and risks triggering a growing infrastructure deficit.”
It goes on to request that only local planning authorities with robust policies in place for CIL should be subject to the changes by April 2014. That causes me to worry that there is going to be yet more impetus for the new homes bonus to be spent on infrastructure that should otherwise be provided by different mechanisms.
Andrew Stephenson (Pendle) (Con)
I congratulate my hon. Friend on securing the debate. I agree with what he has said and also the comments from my hon. Friend the Member for Rugby (Mark Pawsey) and the hon. Member for Hyndburn (Graham Jones) about the 80:20 split. Will my hon. Friend the Member for Meon Valley (George Hollingbery) comment on another issue? In my constituency there is a significant problem of empty properties. We have 896 empty properties in the town of Nelson alone. Will my hon. Friend join me in welcoming the Government’s decision to include long-term empty properties being brought back into use as part of the new homes bonus, thus boosting the financial viability of regeneration schemes in areas such as Pendle?
George Hollingbery
That is entirely to be welcomed. I would add that a section in the recently published final scheme for the new homes bonus reminds us that the spending review also announced that the Government were investing £100 million through the Homes and Communities Agency to enable housing associations to support local authorities to bring more than 3,000 homes back into use. As a package, I think that is to be welcomed. It is right that the new homes bonus should also be made attractive by bringing empty homes back into use.
My second question to the Minister is about transfers across local planning authority borders. I emphasise again that the new homes bonus is to compensate for a loss of amenity. However, what about the loss of amenity to those sitting on the other side of a local planning authority boundary? All of us who represent rural constituencies—and even those who perhaps represent slightly more urban areas—will recognise a situation in which one planning authority plans a large number of homes in an area of its administration which will not have any effect on its citizens.
There is such a development in my constituency at Whiteley, where 15 years ago a large new development of 4,000 homes was built. It was immediately adjacent to Fareham town, which has no contacts at all with Winchester district. All contacts went south. Under current rules on the new homes bonus, all of that new homes bonus would flow to Winchester and not to Fareham where it rightly should be. Likewise, we are now confronted by a proposal from Fareham borough council, which wishes to build 6,000 homes on the border of Winchester constituency, with most of the loss of amenity affecting those in Wickham and Knowle in the Winchester district authority.
I believe we should be able to form neighbourhood forums across LPA boundaries, and some of the payment of the new homes bonus should go directly to those forums across boundaries. We should at least encourage the chief executives and leaders of local councils that reduce the amenity of those across the border to share and share alike.
Jason McCartney (Colne Valley) (Con)
I thank my hon. Friend for giving way and for securing this important debate. House building is probably the biggest issue in my constituency at the moment. The Labour-led Kirklees council is pushing a local development framework plan using the old regional spatial strategy house-building target of 26,000. There is a lot of suspicion about that, particularly about the new homes bonus.
My hon. Friend spoke about the loss of amenity. My constituents are really worried about the loss of amenity of green belt, green fields and the countryside. Could we ask the Minister about the possibility of a massively disproportionate new homes bonus for houses built on brownfield sites and regeneration of empty homes, which my hon. Friend the Member for Pendle (Andrew Stephenson) mentioned, as opposed to a bonus for homes built on greenfield sites? That would be a really positive step.
George Hollingbery
I thank my hon. Friend for his intervention and add his question to the Minister’s already long list.
The Parliamentary Under-Secretary of State for Communities and Local Government (Andrew Stunell)
It is a pleasure to serve under your chairmanship, Mr Williams, and I congratulate my hon. Friend the Member for Meon Valley (George Hollingbery), his hon. Friends and the hon. Member for Hyndburn (Graham Jones) on their contributions to the debate.
My hon. Friend the Member for Meon Valley fairly set out the problem that the new homes bonus is intended to address. For decades house building has failed to keep up with people’s needs, and a combination of the recession and the regional spatial strategies targets that generated a bow-wave of opposition in many areas, led to a steep decline in the number of new homes provided. The year 2009 saw the lowest level of house building in England and Wales in peacetime since 1923, and the cost of a new home doubled in real terms between 1997 and 2007.
There is no doubt that housing is central to economic success as well as to personal well-being. We need to make building homes a motor for growth again. The new homes bonus will do exactly that. It has localism at its heart; it will re-energise communities; it will give them an incentive to say yes rather than no, which was the consequence of the top-down, target-driven scheme that it partly replaces.
Graham Jones
I welcome the Minister’s comments that this is a positive policy to encourage growth, and his assertion that it will create growth. However, what is the incentive to build houses in light of the following two factors? The hon. Member for Pendle (Andrew Stephenson) touched on them. The first is population decline, and the second is the existence of too many houses already.
Andrew Stunell
I suggest that the hon. Gentleman look at the empty homes element of the new homes bonus as particularly appropriate for the communities of east Lancashire. My hon. Friend the Member for Pendle (Andrew Stephenson) made exactly that point. It is an important way of providing a market signal to those who own empty homes, to encourage them to invest in them and bring them back into use.
Graham Jones
I accept the Minister’s point that long-term voids are not on the council tax base, but short-term voids are. There will be a mix when a row of terraced houses is demolished: there will be short-term empties, occupied houses and long-term voids. Some houses will be deducted, so short-term voids are included in the net figures for the new homes bonus. Will the Minister comment on that?
In describing his policies the Minister talks about regeneration, but also about two-into-one and three-into-one schemes. The hon. Member for Pendle has some of those schemes in his constituency which, I know, are very successful and are selling well. There will be net reductions in the new homes bonus available for constituencies such as Pendle. Surely, the two-into-one and three-into-one schemes and short-term voids should not be part of the new homes bonus. We need to add to the council tax base process an element that includes those that are on the council tax base, and not just talk about long-term voids that are not. Will the Minister accept those points?
Andrew Stunell
I notice that Pendle is credited with 107 new homes, so it will be getting the new homes bonus. It is only fair to my hon. Friend the Member for Meon Valley, who initiated the debate, to turn to his points.
It should be clear that the Department for Communities and Local Government has set aside almost £1 billion for the scheme over the spending review period, including £200 million in 2011-12. That funding for 2011-12, contrary to the assertion of the hon. Member for Hyndburn, is additional money outside of the grant formula.
The balance between market and affordable homes is also crucial and, therefore, there is an additional £350 payable for each affordable home for the following six years, on top of the new homes bonus for homes in general. That means that local authorities could receive up to £9,000 for each affordable home over the next six years.
Gavin Barwell (Croydon Central) (Con)
I thank the Minister for giving way. I served with him on the Localism Bill Committee, and we had long debates about the benefits of incentives versus coercion. Does he agree that it is important that the Government should constantly review the level of the bonus, for both normal and affordable housing, to ensure that the incentive is sufficient to generate the necessary level of house building?
Andrew Stunell
I will shortly be speaking about some of the other incentives that are in place, but I agree with my hon. Friend that if we had more money we could have bigger incentives. Nevertheless, it might be wise to wait for the scheme to bed in before starting that revision.
The scheme will pay grant equal to the national average for the council tax band concerned on each additional property, and it will be paid for the following six years as an un-ring-fenced grant. I stress that it is not ring-fenced; the Government make no prescription and give no advice to local authorities on how they might spend the money. It is entirely a matter for the recipient authorities. That brings me to who are the recipient authorities.
My hon. Friend the Member for Meon Valley asked me to say something about the split between the county and district tiers in two-tier areas. First, I should say that in single-tier areas, 100% goes to the principal local authority; in county areas, 80% goes to the district planning authority, and 20% to the county council. When I say “it goes”, that is the default position, but it is open to each of those authorities to consider whether they want that to be the case in all circumstances. For instance—this is an example; it is not intended to be a Government directive—if the tipping point for the creation of a new primary school were involved, there might well be some other consideration than 80:20. I remind the House that when it comes to local authority spending, it is generally the case that 80% is spent by the county and 20% by the district, so we are inverting that ratio.
Every development is different and will need different services to support it, and different local concerns will drive the choice on how to spend the new homes bonus. Local authorities and local communities are best placed to negotiate those choices in meeting the needs of local neighbourhoods. My hon. Friend spoke of local communities having the loudest voice. I certainly agree with him on that, hence the 80%, but there are also parish and town councils; and in many unparished areas there will be residents’ and community groups. I would expect sensible local authorities, in working through the new local planning arrangements with neighbourhood plans, to see the bonus as a vital part of negotiating effectively with those communities on how the new homes bonus should apply in those areas.
My hon. Friend also asked how the boundaries question would be dealt with, and gave the example of Whiteley. That may be seen as pulling in the opposite direction to his point about county and district investment, because both of the areas that he spoke of are in Hampshire. The county council will benefit by just over £1 million from the new homes bonus—that will be its 20% for the coming year—and it is a provider of services across both of the areas mentioned. In such situations, the fact that there is a top-tier section of the new homes bonus may be to everyone’s advantage. In addition, the Localism Bill introduces a duty for local authorities to co-operate, which is relevant in establishing plans, taking decisions about how things such as the new homes bonus should be spent, and how some common objectives can be met.
My hon. Friend the Member for Colne Valley (Jason McCartney) asked about the possibility of adapting the new homes bonus to give preference to approvals on certain types of land. That is not part of the scheme; nor, as things stand, do I foresee it happening in future. However, the introduction of the neighbourhood planning system will give local communities and local neighbourhoods a much firmer grasp of such decisions as they build up their neighbourhood plans under the district plan, which is subject to the national planning policy framework. I hope that my hon. Friends are satisfied to hear that.
If I may, Mr Williams, I shall use the rest of my time speaking about the different streams of money that support the Government’s intention to see vigorous, sustainable development across the country. My hon. Friend the Member for Meon Valley asked about open spaces funding. The Department has set aside £11.2 million for community green spaces funding for the coming year. That goes principally to supporting groundwork for the green flag award accreditation scheme, and the federation of city farms and community gardens partnership work programme. Those programmes continue on a comparatively modest scale, but the amount that local authorities choose to allocate for parks and other green spaces is rightly a matter for them.
George Hollingbery
Do I take the Minister to mean that open spaces funding will not be levied on developments from now on?
Andrew Stunell
I am sorry to say that I did not catch what my hon. Friend said.
George Hollingbery
I apologise. Am I to take his comments to mean that local authorities will no longer be levying an open spaces fund—a charge for open spaces?
Andrew Stunell
I shall take note of that question and write to my hon. Friend, so that I do not give a misleading response.
The Government have given communities the opportunity to participate much more strongly in the process of protecting spaces through the community assets list, the community right to reclaim land and the community right to bid and challenge. Local communities that are concerned about these matters therefore have a number of opportunities to become directly involved.
As well as the new homes bonus there is, as my hon. Friend said, the community infrastructure levy and section 106 agreements. Both are specifically directed to infrastructure investment and planning outcomes. They are different from the new homes bonus; they are not ring-fenced and there is no obligation for the money to be spent on infrastructure or related matters.
Local authorities will have the opportunity to introduce a community infrastructure levy. I note the concerns that my hon. Friend passes on from Hampshire, but it is important that we get these incentives in place quickly. If my hon. Friend lets me have that correspondence, the Department will give some thought to those matters.
Section 106 will be scaled back so that it is specifically directed to deal with the impact of particular developments. Statutory tests were introduced in 2010 to ensure that obligations are directly related to proposed developments. Regulations prevent section 106 agreements and the community infrastructure levy being collected for the same piece of infrastructure. After 2014, tariff-style planning and obligations will not be permitted. The characteristic level at which the community infrastructure levy is likely to fall would be between £5,000 and £10,000 per home. Taken with the new homes bonus, it is a really powerful incentive for communities to agree to new developments.
National Blood Service
(13 years, 1 month ago)
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Jim Dobbin (Heywood and Middleton) (Lab/Co-op)
Thank you, Mr Williams, for relieving me of my Chairman duties so punctually. It was a great relief to have a rest and a coffee before I opened this debate. I am pleased to see the Minister in her place, because this is a subject that she will understand from her time in the national health service. I requested this debate on the future of the National Blood Service to highlight the intentions of the Government to sell off “elements” of the service to the private sector. I understand that there have been some preparatory discussions with a number of contractors. That was revealed in a report in the Health Service Journal. Three possible contractors are Capita, DHL and TNT.
In the paperwork relating to this debate, Members may notice that I have an “R” after my name. I spent 34 years in the national health service. Although I specialised as a medical scientist in microbiology in the NHS, I spent some of my former years in the National Blood Service, particularly in emergency transfusion services, so I have some experience of the subject.
The NHS staff who deliver that service are highly skilled and highly trained and it is essential that they are. I notice that a number of my colleagues are here, and I am quite happy for them to get involved in this debate. I will only spend about 10 minutes talking on the subject.
The annual review of the National Blood Service—and it is its own review—highlights the efforts that have gone into offering a world-class service to the NHS. It is probably the best blood service in the whole of the globe. Thanks to its unique clinical knowledge and experience and the support that it receives from its many dedicated donors and families, many people who need blood and organs can be saved. In its annual review, the organisation has spent some time evaluating its system and performance. In other words, it has looked at itself in great depth and that has allowed it to achieve substantial savings and to lower the cost of a unit of blood. According to its annual review, a unit of blood has dropped from £140 to £130 and it should reduce further to £125 this year, which will mean a saving of £30 million a year to the NHS. That money can be reinvested in NHS front-line patient care.
The National Blood Service administers not just units of blood, but organ donation, tissue donation and work on stem cells. There have also been improvements in the delivery of organ donation procedures, including training additional specialist nurses and increasing the numbers of people who are prepared to contribute organs. User hospital trusts pay for the blood products and services. It is important that both hon. Members and the public understand that blood and tissue donors give their services for free.
Andrew Stephenson (Pendle) (Con)
I congratulate the hon. Gentleman on securing this important debate. May I ask him a question on the subject of reform? The National Blood Service is crying out for new donors. Should the fact that there is still an arbitrary ban on certain groups of society giving blood, such as gay men, be up for review or does he think that such a ban is okay?
Jim Dobbin
Everything should be up for review at the present time. I am quite sure that the National Blood Service is considering that matter as part of its review.
Donors give their services absolutely free to the national health service. The Department of Health funds the production of all the organisation’s services within its factories, processing centres and laboratories. The system has a record of sound financial control, of which the NHS should be proud. I was in the service when cleaning services were compulsorily tendered out to the private sector. If my memory is correct, that resulted in a reduction in the quality of service. We saw wards cleaned less frequently and an increase in hospital infections such as clostridium difficile, E. coli 0157 and methicillin-resistant Staphylococcus aureus. We have all seen the publicity that such infections have received. Privatisation would introduce an element of cost cutting in order to increase profit. Shortcuts, reduced training and a reduction in quality are all strong possibilities.
The public who donate their services for free will be discouraged from taking part if the profit motive is introduced. The demand for blood from those who have serious health conditions will not diminish, but the supply of donors is in danger of being reduced.
Mr Gerry Sutcliffe (Bradford South) (Lab)
I congratulate my hon. Friend on securing this debate. As I understand it, the National Blood Service is allowed to use the blue flashing light to transport blood to the most serious cases. Is it not the case that if the service were privatised, the private sector companies would transport the blood but would not be able to use the blue-light service because it is restricted at the moment?
Jim Dobbin
If that were the case, it would make it much more dangerous for those patients who were waiting to receive that blood or organ. I would not like to see that happening.
The National Blood Service has created a strategy for each of its departments as it strives to improve its service and, looking at the review in great detail, in my view, it is succeeding. It is aware of the current economic situation and the constraints that it is working within over the next few years. It is planning more developments in future years. The question that has to be asked is why sell off something that is working so well. I understand that scientific staff have been angry about these moves. They have blasted the Government plan and demand changes to the Health and Social Care Bill, which will let private companies cash in on lucrative Government contracts.
Lisa Nandy (Wigan) (Lab)
Does my hon. Friend share my concern about the staff who currently work in the National Blood Service? Many of them opt to work in such services because they believe in the public good and in the common good. Does he share my concern about the impact that privatisation will have on them?
Jim Dobbin
Yes. That is exactly right. Those staff, who are well trained specialists in their area, are very concerned about the damage that this proposal would do to the blood transfusion system and they are very angry about what is possibly going to happen. Of course, they also fear that donors will walk away. There are 1.4 million volunteer donors at the moment. They donate about 200,000 units every year, which is a huge amount of blood, and all of it is donated voluntarily. Privatisation of the blood service has been tried in New Zealand and it drove down the number of blood donors. It deterred them from making that contribution freely, because donors do not like to see their organs or blood as part of a private sector business.
Why should the private sector profit from blood that is given freely? There is no private sector organisation that has the expertise to provide the range of services—blood supplies, tissue, organs and specialist products, plus the specialist research expertise—that are provided by the NHS blood transfusion service.
Jason McCartney (Colne Valley) (Con)
I congratulate the hon. Gentleman on securing this important debate. He raised an important issue when he said that there are a number of reasons why people give blood. Personally, I gave blood at the Galpharm stadium in Huddersfield a couple of years ago because I was inspired by Adrian Sudbury, the journalist from The Huddersfield Daily Examiner. Before he died, he also inspired people to sign up to the bone marrow register maintained by the Anthony Nolan Trust. So there is a lot of good work going on and the hon. Gentleman has identified that. I hope that the Minister, in her deliberations, will think about the other roles that the National Blood Service plays. The hon. Gentleman quite rightly identified that the service is not only about giving blood but about giving tissue and other material. I thank him for making that point.
Jim Dobbin
I thank the hon. Gentleman very much. That was a very positive contribution, based on his own specific experience. There is a petition about this issue, there are now some 35,000 signatures on it, and it is building up all the time.
Grahame M. Morris (Easington) (Lab)
I also congratulate my hon. Friend on securing a very important debate about an issue that is of great concern among the public. I wanted to ask him about the lessons from overseas countries where blood transfusion services have been privatised and where it is standard to pay for donated materials. What lessons can we learn from those countries about the safety of supply?
Jim Dobbin
I referred earlier to another privatisation that took place in the health service, when cleaning was put out to tender. Of course, the quality of the service was reduced. That is exactly what I fear will happen with the blood service, because if someone is in the business of making money and making profit they take short cuts. It is as simple as that.
The petition that I was talking about is building up. In addition, 300 people got in touch to say how much they valued the blood service. For many of those people, their loved ones personally benefited from the altruism of a fellow human being.
The blood service began before the national health service, around the time of world war two, when the demand for the service originated. So the blood service is older than the NHS.
I am very concerned. The Government are saying that only elements of the NHS blood transfusion service are under discussion at the present time but that is a dangerous route to go down. I hope that the Minister will take this issue back to the Government and the Secretary of State, and ask for a review of this particular service that the public so dearly love. The other thing that I will say is that if someone is looking for a big society in action, the blood service is it.
The Parliamentary Under-Secretary of State for Health (Anne Milton)
Having not served under your chairmanship before, Mr Williams, I now find myself doing so twice in a day. It is a pleasure.
I congratulate the hon. Member for Heywood and Middleton (Jim Dobbin) on securing the debate and I pay tribute to his experience of this sector. I also echo the tributes that he paid to the staff who are part of such a fantastic organisation and who are one of the reasons why it has such a high reputation.
The debate is an important opportunity to discuss an issue that is not only important to the NHS and the public but which has been the subject of very unhelpful rumour and speculation. I become very disappointed when I see scare stories in the press that are not necessarily based on any foundation and that will only result in scaring people off donating blood, tissue or organs. Those stories are not helpful. I urge the hon. Gentleman and the other hon. Members sitting beside him that if they want to clarify the situation they should please feel free to contact me. That is much better than running scare stories, or a story getting out of hand, so that the issue becomes a disservice to the public we are all trying to serve.
Contrary to what some people have been saying publicly and indeed privately, there are no plans to privatise the blood service, which is part of NHS Blood and Transplant, or NHSBT. I can say categorically that we are not selling off the service. If I do nothing else in this debate, I want to knock that rumour on its head.
The Government have said previously that we will retain a single national system for blood with NHSBT at its helm and we stand by that statement. Under its current management team, NHSBT has done a great job and it continues to do so. It has maintained—indeed, greatly improved—the stability and security of the blood supply. It has also improved productivity in blood processing and testing by more than 50% in three years, which is a true achievement.
Jim Dobbin
I have a letter from Andrew Pearce, who is the head of donor advocacy in the NHS. The second paragraph says:
“The review is at an early stage and is likely to take a few months. Although we cannot rule out that the review might eventually suggest that some of our supporting activities should be market-tested, this is by no means certain.”
There is some doubt in that letter, which is from someone within the blood system itself, about whether market-testing is going on with a view to something else happening. People do not test something for the market if they are not intending to put it out to tender.
Anne Milton
I thank the hon. Gentleman for his intervention. What matters is that people get good value for money from the taxes that they pay. What also matters is that we do things effectively and efficiently, so we constantly market-test within NHS provision. We should do so. What matters to us is having a quality service. However, we are not selling off the blood service and we are not privatising it. As for performance, I am sure that the hon. Gentleman will agree that the performance of our blood service puts us in the top quartile compared with other European blood services. That is a fantastic achievement.
I reiterate the hon. Gentleman’s comments about what the improvements in the blood service mean. There has been a reduction in the price of a unit of blood, down by £15 from £140 in 2008-09 to £125 today. As he rightly pointed out, that reduction saves hospitals £30 million each year, which can be channelled straight back into patient care. Again, I pay tribute to the staff who have achieved that reduction.
It would be a huge oversight on my part if I did not also pay tribute to those who donate their blood for the benefit of others. I am pleased to learn that my hon. Friend the Member for Colne Valley (Jason McCartney) has donated blood himself. Every year, 1.4 million people donate blood, which means that 2 million units a year are donated in total. That equates to 7,000 new units of blood every day, or about five a minute. Statistics are wonderful when one is engaged in a debate such as this one; they show the scale of the donations that are made. Those donations have saved countless lives and continue to do so. Indeed, the altruistic donor system is one of the rocks that the NHS is built on and we will not do anything to jeopardise public confidence in it.
It would also be remiss of me not to mention organ donation. The one thing that we do not do often enough is to thank people who donate their organs and those of their loved ones, saving many lives in the process. We have made great improvements in organ donation, which is up by 28% since 2008, but we must continue to make improvements. I do not want anything, anyone or any public statement to jeopardise any of that. On the contrary, we want to carry out a review to help NHS Blood and Transplant to improve its operational efficiency even further and provide an even better service.
The blood service must be seen in the context of its role in the NHS. The hon. Member for Easington (Grahame M. Morris) mentioned courier services for getting blood around the place. We have been using courier services for many years—the previous Government did so as well—to deliver organs and tissue, and there is no question of putting the delivery of blood at risk.
Grahame M. Morris
Just for the record, it was my hon. Friend the Member for Bradford South (Mr Sutcliffe) who raised that issue, but it is one that I am concerned about.
Will the Minister address the new role of the economic regulator, Monitor, and the responsibilities that it will have regarding competition? Will its remit extend to the blood service?
Anne Milton
I apologise for confusing the hon. Gentleman with the Member who was sitting next to him. At least it gave me the opportunity to clarify the point. To ensure that I give the hon. Gentleman a precise answer, I will have to come back to him on Monitor because I do not have the information with me. I will happily do that after the debate.
The blood service is self-funding, in that it recovers the cost of collecting, testing and processing blood through the price paid by the NHS for each unit. The price of a unit is therefore directly related to the efficiency with which NHSBT conducts its operations; the one feeds into the other. If the cost of a unit of blood goes up, there is pressure on budgets, so the whole NHS has an interest in NHSBT being as efficient as possible and keeping the cost low. The £30 million that we have been able to put back in demonstrates that costs are being kept low, and more can be spent on patient care.
The review of NHSBT was announced in the report produced by the arm’s length bodies review in July 2010. The review is ongoing, and I cannot say what the outcome will be, but I would like to explain what the review is about, and in doing so, clarify what it is not about and hopefully reassure the hon. Member for Heywood and Middleton and all those who might share his concerns.
The review will identify opportunities both to help NHSBT further improve the efficiency of its operations, and to save money. Aspects of NHSBT’s activities covered by the review include IT, estates, testing, processing and logistics. NHSBT has recognised that those areas have room for improvement, in both developing services and increasing efficiency; such functions can often be carried out more efficiently. NHSBT already outsources some of its activities to private sector companies, for example facilities management, legal services and the call centre, so by exploring whether greater savings are possible, the review does nothing new. It simply takes a currently successful model, which has demonstrated that it can improve, and considers whether it would work if it were to be expanded.
As I said, we are looking to ensure maximum efficiency for NHSBT, and I am sure that the hon. Member for Heywood and Middleton agrees with that aim. We will do whatever works, and whatever can ensure a safe supply of blood to the NHS.
Tom Blenkinsop (Middlesbrough South and East Cleveland) (Lab)
Will the review of the British national blood service be subject to European competition law?
Anne Milton
I am pretty sure that it will, but I will check.
There have been suggestions that outsourcing some other functions might lead to donors declining to donate. We are absolutely clear that in exploring other opportunities, we will not put at risk any aspect of public health. I do not want donors or any Member here today to believe that this is privatisation of our highly respected National Blood Service.
Jason McCartney
I thank the Minister for clarifying that there will be no sell-off—no privatisation—of the National Blood Service. Some Opposition Members are concerned that if there was some privatisation there would be a drop in donations, which is something that no one in the House would wish. Hopefully, Members on both sides of the House can now pass on that information, so that there is confidence in the National Blood Service and we see an increase in donations. We welcome the efficiency measures as well.
Anne Milton
I thank my hon. Friend for reiterating that point. Blood is donated freely to the NHS to improve and save patients’ lives. Like any donation, it is a gift, and we want to maximise the opportunities for that gift. We do not want to do anything to discourage donors. I state categorically that the donor-facing aspects of blood donation are excluded from the review, which will ensure that the relationship between NHSBT and its donors is not compromised.
My hon. Friend the Member for Pendle (Andrew Stephenson) mentioned that people, in particular men who have had sex with men, are excluded from blood donation, and that issue is currently under consideration. I understand that there has been a lot of concern that the rules are outdated, and we will make an announcement on the issue at some point in the near future.
I feel that I have been repetitive, but I need to be to make the point, so I reiterate the Government’s support for, and belief in, a single national system for donated blood and organs, with NHSBT at its helm. That does not mean there is a blinkered belief that the system has already reached the peak of its potential; it would be remiss of the Government to think so. NHSBT, like all areas of public and private life, must continue to innovate and to challenge itself if it is to provide the best possible service. The current review is designed to explore how it can do that, to keep the price of blood—the cost to the NHS—as low as possible and to provide the high-quality blood service that donors and recipients deserve.
Jim Dobbin
I agree that we should continually look at research and at improving the system for the people of this country. I have no problem with that, except that I would like the service to remain within the NHS.
Anne Milton
In everything he does, the hon. Gentleman operates from a deep-seated belief in organisations such as the NHS, and he wants the best, not just for his constituents but for the people of this country. I therefore urge him, as I urge all Opposition Members, not to play politics with this issue, although I am sure that that is not his intention. If Opposition Members have any concerns, I urge them to discuss them with me; my door is open. It would be a tragedy if anyone did anything that reduced the number of donors coming forward. We are determined to ensure that that does not happen, but scare stories in the press can have that unintended consequence. We should not believe everything that we read in the newspapers.
Question put and agreed to.
Written Ministerial Statements
(13 years, 1 month ago)
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Tax Policy Making, Tax Impact Assessments and Tax Information and Impact Notes
(13 years, 1 month ago)
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The Exchequer Secretary to the Treasury (Mr David Gauke)
As set out in “Improving tax policy making: the new approach” published on 9 December 2010, the Government have adopted a new process for undertaking impact assessment of tax and national insurance contributions (NICs) policy changes. This new tailored tax impact assessment process will be used throughout the development of tax and NICs policy and will be summarised in tax information and impact notes. These notes set out what the policy change is, why the Government are proposing the change and a summary of the impacts of the change. As explained below, they will be produced for all substantive changes in tax and NICs policy by primary and secondary legislation.
This new approach will consider a wider range of impacts and cover a broader range of policy changes than the existing impact assessment regime for tax. The Government are committed to consulting on tax policy changes and will use consultation and stakeholder engagement to inform and test their understanding of the impacts of a proposed change in policy.
From Budget 2011 onwards, the Government will publish a tax information and impact note for tax policy changes at the point at which the policy design is final or near final. This could be alongside the Budget, publication of draft legislation or final legislation, as appropriate. These notes will provide a clear statement of the policy objective, impact on the Exchequer, the economy, individuals, businesses and civil society organisations, as well as any equality and other specific impact.
Tax information and impact notes will be available on the websites of HM Treasury and HM Revenue and Customs, and will be provided to Parliament through the normal publication channels.
There will be a number of exceptions where a tax information and impact note will not usually be published alongside a routine legislative change that gives effect to previously announced policy, for example:
routine changes to rates, thresholds and allowances to a predetermined formula such as indexation;
appointed day orders;
secondary legislation enacting double taxation treaties; and
secondary legislation not laid before Parliament.
Hutton Review
(13 years, 1 month ago)
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The Chancellor of the Exchequer (Mr George Osborne)
Will Hutton has today published the final report of his review of fair pay in the public sector.
In May the Government asked Will Hutton to make recommendations to the Chancellor and the Prime Minister by March 2011 on promoting pay fairness in the public sector by tackling disparities between the lowest and highest paid in public sector organisations.
The Government welcome this report and are grateful for the work of Will Hutton and the staff of the review. The Government are committed to striking a balance between value for money for taxpayers and fair pay for public sector workers. We will give careful consideration to the recommendations and respond in detail in due course.
The report is available in the Vote Office and the Printed Paper Office and it has been deposited in the Libraries of both Houses.
The report is also available on the review’s website at
http://www.hm-treasury.gov.uk/indreview_willhutton_fairpay.htm.
Diplomatic Service Appeals Board
(13 years, 1 month ago)
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The Parliamentary Under-Secretary of State for Foreign and Commonwealth Affairs (Alistair Burt)
Following the proposal by the public bodies review on 14 October to abolish the Civil Service Appeals Board (CSAB), the Secretary of State has taken the decision to close the Diplomatic Service Appeals Board (DSAB). Like the CSAB, the DSAB was a non-departmental public body. It heard appeals from dismissed members of the diplomatic service, mirroring the main role of the CSAB which considered appeals from dismissed members of the home civil service. The internal appeals mechanisms for staff members dismissed by the Foreign and Commonwealth Office will remain in place. They may also make a claim of unfair dismissal to an employment tribunal.
The Permanent Under Secretary of the Foreign and Commonwealth Office has written to the current DSAB members thanking them for the contribution they have made to the board.
Draft Defamation Bill
(13 years, 1 month ago)
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The Lord Chancellor and Secretary of State for Justice (Mr Kenneth Clarke)
The Government have today laid before Parliament a draft Bill on defamation for public consultation and pre-legislative scrutiny. This reflects the coalition commitment to review the law of libel to protect free speech.
There are real concerns that the threat of libel proceedings is being used to frustrate robust scientific and academic debate, and to impede responsible investigative journalism and the valuable work undertaken by non-governmental organisations. These concerns relate not only to cases which actually come before the courts, but also in relation to the chilling effect on freedom of expression that is created more widely by the threat of costly and protracted legal proceedings against defendants who may often have limited resources.
The proposals in the draft Bill and consultation paper aim to ensure that the right balance in the law is achieved, so that people who have been defamed are able to take action to protect their reputation where appropriate, but so that free speech is not unjustifiably impeded. We also want to look at ways of speeding court cases up, so as to cut the costs involved in defamation proceedings.
The draft Bill contains provisions on the following issues:
A new requirement that a statement must have caused or be likely to cause substantial harm in order for it to be defamatory;
A new statutory defence of responsible publication on matters of public interest;
A statutory defence of truth (replacing the current common law defence of justification);
A statutory defence of honest opinion (replacing the current common law defence of fair/honest comment);
Provisions updating and extending the circumstances in which the defences of absolute and qualified privilege are available;
Introduction of a single publication rule to prevent an action being brought in relation to publication of the same material by the same publisher after a one-year limitation period has passed;
Action to address libel tourism by ensuring a court will not accept jurisdiction unless satisfied that England and Wales is clearly the most appropriate place to bring an action against someone who is not domiciled in the UK or an EU member state;
Removal of the presumption in favour of jury trial, so that the judge would have a discretion to order jury trial where it is in the interests of justice.
Issues which have not been included in the draft Bill at this stage, but on which the consultation paper seeks views are:
Responsibility for publication on the internet. The paper seeks views on whether the law should be changed to give greater protection to secondary publishers such as internet service providers, discussion forums and (in an offline context) booksellers, or alternatively how the existing law should be updated and clarified;
A new court procedure to resolve key preliminary issues at as early a stage as possible, so that the length and cost of defamation proceedings can be substantially reduced;
Whether the summary disposal procedure should be retained, and if so whether improvements can usefully be made to it;
Whether the power of the court under the summary procedure to order publication of a summary of its judgment should be made more widely available in defamation proceedings;
Whether further action is needed beyond the proposals in the draft Bill and the introduction of a new court procedure to address issues relating to an inequality of arms in defamation proceedings, including whether any specific restrictions should be placed on the ability of corporations to bring a defamation action;
Whether the current provisions in case law restricting the ability of public authorities and bodies exercising public functions to bring defamation actions should be placed in statute and whether these restrictions should be extended to other bodies exercising public functions.
We believe that publication of a draft Bill for full public consultation and pre-legislative scrutiny will help us to achieve fully considered legislative proposals which focus on core issues of concern where legislation can make a real difference. After the consultation process is completed, we intend to introduce substantive legislation as soon as parliamentary time allows.
Grand Committee
Pensions Bill [HL]
(13 years, 1 month ago)
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The Deputy Chairman of Committees (Lord Geddes)
My Lords, as is usual on these occasions, I must remind the Committee that, if there is a Division in the Chamber while we are sitting, the Committee will adjourn as soon as the Division Bells are rung and resume after approximately 10 minutes.
Clause 10 : Certification that alternative to quality requirement is satisfied
Amendment 42
Lord McKenzie of Luton
Lord McKenzie of Luton
My Lords, I shall also speak to Amendment 43. Concerns about levelling down have been raised throughout the development of the auto-enrolment proposals. In an attempt to predict the likely occurrence of this, a range of interested parties, including the DWP, have carried out surveys. The Johnson report summarises its view on the position on page 63. It says that,
“taken as a whole, the bulk of evidence suggests only limited reductions in pension contributions as a result of the reforms. Surveys by Fidelity, Capita Hartshead and the CBI consistently report that around seven in ten employers are not planning to revise or reduce their current levels of provision, and the National Association of Pension Funds found only three per cent of employers planning to reduce contributions for existing members”.
The thrust of this is to be broadly welcomed, but we accept that differing definitions of qualifying earnings and perhaps more traditional definitions of pensionable pay can add to uncertainty, although I believe that the previous Government made it clear that it was the quantum of contributions rather than the basis of calculation that was important. This issue prompted the search for a process of certification that allows an employer to certify overall that schemes satisfy the relevant quality criteria for defined contribution schemes. That in theory avoids the necessity of demonstrating in respect of each employee by detailed calculation that the minimum contribution on the basis of qualifying earnings as defined in the Bill has been met. That is easier said than done. I recall a number of meetings with stakeholders trying to unlock this conundrum of wanting to encourage employers to stay with existing but quality schemes on the one hand but being reassured that auto-enrolment worked for all, especially those who had been shut out of pension savings in the past.
Clause 10 introduces an alternative requirement to the quality requirement set down in existing legislation that will enable a scheme to be used for auto-enrolment. It is to this that Amendments 42 and 43 relate. The Bill states:
“In prescribing an alternative requirement … the Secretary of State must be satisfied that, in all or most cases, a scheme will be able to satisfy the requirement only if … for a majority of individual relevant jobholders, and … all relevant jobholders taken together”,
the relevant quality requirements in respect of employer and total contributions are met. Our amendment would require the Secretary of State to be satisfied in respect of all cases and for more than a majority of individual relevant jobholders. We have defined this as 95 per cent or all routinely.
My first question to the Minister is why the Secretary of State cannot seek to be satisfied in respect of all cases for which an alternative requirement is prescribed. What are the sort of exceptions considered desirable or acceptable, and why?
My second question relates to new subsection (2A). The alternative requirement needs to ensure that for all jobholders or a cohort—the relevant jobholders—sufficient employer and overall contributions are paid to satisfy the relevant quality requirement. However, it also requires this to be the case for individual relevant jobholders, but only for a majority of them—50 per cent plus one. Clearly, this could lead to significant numbers of individuals missing out. The aggregate requirement could be met by more generous contributions for some jobholders with less than qualifying amounts for others.
The Delegated Powers and Regulatory Reform Committee refers to this as a significant power, as, indeed, it is. We are obviously aware of the proposed certification model on which the DWP is working. The Minister may want to update us on progress. The proposal is based on employee’s pensionable pay from pound one and has three steps: a 9 per cent minimum for each jobholder; an 8 per cent minimum for each jobholder where pensionable pay in aggregate equals at least 85 per cent of total pay; and 7 per cent for each jobholder where 100 per cent of pay is pensionable. It is understood that this may give some 92 per cent coverage, but the Minister might like to explain precisely what this coverage is. What analysis has been undertaken of the 8 per cent who presumably would not, on an individual basis, have a minimum contribution paid on their behalf?
However, our focus is not only on how this particular scheme would work; it is crucially on the powers that it is proposed to enshrine in primary legislation. Should a Secretary of State be so minded—I certainly do not contend that this is the case at present—an alternative requirement could allow nearly half of all jobholders to be short-changed. This is simply not acceptable to us and we urge the Minister most strongly to look at these powers again. I beg to move.
The Parliamentary Under-Secretary of State, Department for Work and Pensions (Lord Freud)
My Lords, I thank the noble Lord, Lord McKenzie, for his amendments to Clause 10. These amendments would require the Secretary of State, before making regulations on certification, to be satisfied that in every scheme at least 95 per cent of individuals would receive contributions no less than the statutory minimum. It is my understanding that these amendments may have been introduced to seek assurances that individuals will not potentially lose out under the proposed certification arrangements. The noble Lord made that clear in his remarks. I very much share his concern. That is why we have developed a certification test that balances simplicity with safeguards. The high-level certification requirements in Clause 10 will allow for a straightforward test of scheme quality to be set out in regulations for employers who calculate their pension contributions on basic pay rather than qualifying earnings but offer good-quality money purchase pension schemes. These employers will be able to demonstrate that their schemes meet the minimum quality requirements.
It might help if I briefly describe the certification test in the form that it is envisaged it will take in regulations. Contributions start from pound one and the test itself is based on three graduated tiers. Setting the first tier of the certification test at 9 per cent of basic pay provides a straightforward benchmark for schemes. We expect that a contribution of 9 per cent of basic pay will be a better deal than 8 per cent of qualifying earnings for 95 per cent of individuals who work in the private sector and who are eligible for automatic enrolment. Employers who make slightly lower contributions of 8 per cent or 7 per cent of basic pay will be able to certify that contributions must be based on a set ratio of pensionable pay to total pay. In the latter case, all pay must be pensionable. Employers using certification will be able to increase their contributions gradually. The precise details of how this will work will be set out in secondary legislation.
We worked collaboratively with key stakeholders, including the National Association of Pension Funds, the Association of British Insurers, the Confederation of British Industry, the Society of Pension Consultants, accountants and lawyers in designing the certification model. Employers and trade unions have broadly welcomed the certification arrangements as a pragmatic solution to a difficult problem. I hope that we have managed to unlock the conundrum referred to by the noble Lord, Lord McKenzie.
In designing the certification model, we addressed two risks: first, that there would be a significant detriment to individuals; and, secondly, that any certification test would be too complex. It is important that we get the balance right, as we do not want to encourage employers to level down to the statutory minimum, resulting in lower contributions for many of their workers. To protect individuals, the certification test broadly equates to the statutory minimum quality requirements for money purchase schemes: a contribution equivalent to 8 per cent of qualifying earnings. However, it uses basic pay from pound one rather than qualifying earnings. Basic pay is the key to simplification and to risk, as it varies across employers. Based on the analysis that underpins the certification model, we estimate that, for more than 90 per cent of people employed in the private sector who are eligible for automatic enrolment, basic pay is greater than or equal to qualifying earnings—I hope that that answers the question posed by the noble Lord, Lord McKenzie. That is because the basic pay calculation is made from pound one, rather than on just a band of earnings. In view of this, we believe that many people will get higher contributions under basic pay. We can monitor and mitigate the risk to individuals and take action if necessary. The bigger risk here is levelling down.
The amendment would require the Secretary of State, before introducing certification in regulations, to be satisfied that for every relevant scheme 95 per cent of the individual jobholders receive at least minimum-level contributions. We would not be able to regulate for the certification test that we currently envisage, which has been welcomed by employers and key stakeholders. In effect, we would be back to square one and would have recreated the conundrum. To make regulations, the Secretary of State would have to introduce a test that required the individual checking of each jobholder’s contribution records. That would make the test more complicated. Alternatively, he would have to set a much higher bar. Employers have told us that the former would impose an unacceptable burden and they would seriously consider levelling down to the legal minimum.
We are aware of the risk of individuals losing out, as the noble Lord pointed out. We have made a commitment to fully evaluating the effects and implementation of the reforms. This will include a proportionate check to ensure that the regulations are operating as expected and that there are no unintended consequences for individuals, employers or industry as a result of the reforms. To minimise the number of individuals losing out, we will monitor trends in the various components that make up an individual’s wage packet in our annual surveys. The data will enable us to monitor trends in pay and reward packages to identify any significant shift in earnings patterns. Our data collection enables us to monitor pay patterns by firm size, occupation and industrial sector. If the data suggest that self-certification is being abused, or more individuals than expected are losing out, the Secretary of State will have the power to tighten or repeal the legislation.
The noble Lord asked about clarity and what Clause 10 means by “a majority”. In this case, a majority means 50 per cent plus. However, the analysis on which the certification model was developed suggests that we can surpass this and other conditions. As I said, we estimate that, for 90 per cent of people employed in the private sector, basic pay is greater than or equal to qualifying earnings.
I believe that we have the right balance that allows an administrative easement for employers and provides safeguards for individuals. I hope that this will go some way towards reassuring the noble Lord, Lord McKenzie. I therefore urge him to withdraw his amendment.
Lord McKenzie of Luton
My Lords, I am grateful to the Minister for his explanation of what is proposed for the certification model, its monitoring and the follow-up work that will be done. However, our basic concern is not the certification model, which has been worked up and, I accept, will be taken forward, but what is in primary legislation about what a Secretary of State can do. As it is written, a Secretary of State could bring forward alternative regulations that meant that only 50 per cent plus one of individual relevant jobholders would be provided for as they should be. It is the broad nature of the primary power that is our main cause of concern. It is a very wide power. What is to stop a Secretary of State bringing forward alternative models?
Lord Freud
I need to answer that, as it is clearly the noble Lord’s core question. The Bill circumscribes the Secretary of State’s powers by providing that, when prescribing certification requirements in regulations, the Secretary of State must be satisfied that, first, in respect of all or most cases, the total contributions paid by the employer and the jobholder together will not be less than if the scheme had met the relevant quality requirement; and, secondly, this must be the case both for a majority of the jobholders in a scheme and for all the jobholders in a scheme taken together.
Lord McKenzie of Luton
My Lords, I am grateful for that, but it does not help me. My problem is that there might be arrangements whereby some of the relevant jobholders—under the provision, you can choose what cohort of jobholders you want to look at; it is not all employees at any one time—could be well provided for and others not. The second part of the test, which looks in aggregate, would be met; all you have to do to satisfy the first part is for 50 per cent plus one of the individuals to be covered. Unless I am misreading that, and I do not think that I am, that is our bone of contention.
Lord Freud
I can give the noble Lord some reassurance. The regulations are affirmative, so we will have the opportunity to debate them at that point.
Lord McKenzie of Luton
With great respect to the Minister, I have trotted that one out myself a number of times. As we know full well, we cannot amend affirmative regulations, although they give an opportunity for debate.
This is a serious issue and a potential loophole in the legislation. I do not suggest for a moment that the Minister or his current colleagues would seek to exploit it; I accept that they are focused on working up a practical scheme. However, this is too wide a power to be left in primary legislation. I urge the Minister to reflect on that and perhaps discuss it with his colleagues to see whether it could be narrowed. We would be more reassured if the terms of the certification model were placed in primary legislation. We do not think that that is necessarily a perfect fit, but it would be a good deal better than the very wide discretion that the Secretary of State will have at present. I accept that that is not in the Government’s thinking at the moment, given the model that is being developed.
I am reassured about the monitoring of the model to be undertaken. I will need to read the record, but I thought that the Minister was saying that we could still end up with 10 per cent of people in schemes who would not fall within its ambit. If that is right, 10 per cent is a big chunk of the people whom we are trying to get into pensions saving. On that point, unless the Minister has anything further to say, I am happy to read the record, because I know that we will come back to this point on Report.
I seriously urge the Minister to consider my first point, because it is a serious problem with the clause and one that we want to follow through. Having said that, I am grateful for the information that the Minister has provided and beg leave to withdraw the amendment.
Lord Freud
“( ) In section 32 of the 2008 Act (power to modify by resolution) in subsection (1)(b) for the words after “the scheme” substitute “to satisfy—
(i) the requirements contained in section 20(1),(ii) those requirements as modified under section 24(1)(a), or(iii) a requirement prescribed under section 28(2)(b).””
Lord Freud
My Lords, I shall speak also to government Amendment 45. The backdrop to many of the measures set out in Part 2 of the Bill is to provide employers with greater flexibility and to ease their burdens. These amendments continue that practice.
With regard to Clause 10, Amendment 44 introduces an amendment into Section 32 of the Pensions Act 2008. The purpose of the amendment is to make it easier for employers, in collaboration with their scheme trustees or managers, to make certain improvements to their occupational money purchase pension scheme and some hybrids to meet the requirements of a certification test. The modification powers in Section 32, as amended by Clause 12, enable trustees or managers to make certain improvements to their scheme by resolution with the employer’s consent to comply with the automatic enrolment requirements. Amendment 44 extends this facility to employers using certification.
Self-certification will provide employers with a straightforward way of ensuring that their money purchase pension scheme satisfies the relevant quality requirements. Employers intending to use self-certification will need to ensure that their scheme satisfies the relevant requirements both at the outset and on an ongoing basis. We have just debated the self-certification option. The point is that this amendment will make it easier for employers, in liaison with their trustees, to make improvements to their schemes in order to comply with the automatic enrolment requirements.
Government Amendment 45 is a technical amendment to Section 30 of the Pensions Act 2008. Section 30 allows employers who are using defined benefit and hybrid schemes to defer the automatic enrolment date for jobholders when certain conditions are satisfied. Where certain conditions cease to be satisfied during the transitional period, the employer must ensure that the jobholder is enrolled into an alternative scheme.
At present, the Pensions Act 2008 restricts the employer to using either another defined benefit or hybrid scheme, or a money purchase scheme, as the alternative scheme. The amendment provides employers using defined benefit or hybrid schemes with greater flexibility around their choice of an alternative automatic enrolment scheme. It will allow employers to choose to enrol jobholders into a personal pension scheme. This is in line with the original policy intent of giving employers maximum flexibility.
Under the amendment, we intend to amend the automatic enrolment regulations to ensure that an employer who intends to use a personal pension scheme for this purpose provides the jobholder with information about the scheme. This mirrors the existing arrangements for money purchase schemes and therefore provides parity. As has already been mentioned, the amendment will ease burdens on employers and provide them with greater flexibility.
To address the concern about whether employers might abuse these amendments, we will monitor trends along with pay and reward packages. If we identify that employers are manipulating the test, the Secretary of State has the power to strengthen the test or, as a last resort, to repeal the legislation. I beg to move.
Baroness Drake
My Lords, as anticipated by the Minister, I rise to express reservations about government Amendment 44, which continues to give rise to the anxieties expressed by my noble friend Lord McKenzie. While on the face of it the amendment appears to be somewhat benign, aimed at improving the drafting of the Bill, on more detailed reading it raises anxieties, certainly in my mind. As I understand it, this amendment would allow trustees to change pension scheme rules to enable their employers to meet the regulatory test set by the Secretary of State for the alternative requirement for certifying that their scheme meets the qualifying earnings contribution standard—the alternative requirement regulatory test, which my noble friend Lord McKenzie was addressing in Amendments 42 and 43.
My anxieties are twofold and I will try not to be too technical in addressing them. First, the intention behind the regulatory test for the alternative certification to the normal statutory quality requirement was, I believe, to assist good employers who run good schemes but who use a definition of pay for pension purposes other than earnings. However, either their scheme meets the test or it does not. An assessment against that proposition should stand or fall on its own merits. Having made the concession of an alternative qualification test, surely one cannot allow scheme trustees to change their scheme rules in order that the alternative regulatory test is met. That strikes me as changing the original intention of the alternative test and encouraging arbitrage by bad employers, particularly if that regulatory test is weakened, because if a bad employer—and I know that good employers will not do this—can see the benefit of redistributing pay between base pay and other elements of earnings, they may be able to avoid paying contributions on a segment or proportion of members of their workforce. If we have good employers—and the primary intention of this regulatory test is to allow them to show that they are good employers—I do not see why the proposition cannot stand or fall on that basis and why we need to allow subsequent amendments to the scheme rules.
Secondly, the Bill allows for the regulatory test, as my noble friend Lord McKenzie has said, to make an assessment for an employer’s workforce as to whether it meets the contribution requirement at the aggregate level. However, it allows simply for an assessment for a majority of employees at the individual level and, in that way, the regulatory test can still be met. This amendment appears on the face of it to allow trustees to change their scheme rules, with the effect that some individuals are made worse off, under both the scheme rules and the statutory provisions, because no one has disputed that it is possible for some individuals—maybe up to 5 per cent or more, even on the Government’s own arguments—to be excluded from a contribution to which they might have had access if the statutory provisions had been strictly applied. However, we now find the situation where a group of individuals could be made worse off—not only under the statutory provisions but also under their scheme rules—but where an employer can still meet the regulatory test.
I am also concerned that this regulatory test could be made weaker. The consultation on the regulatory test, as outlined by the Minister, has not concluded. We know that it is ongoing, so we do not know what will eventually be brought forward in the regulations. If the regulatory test becomes weaker, the problem could become worse, because there is an even greater incentive to change the scheme rules to take advantage of that regulatory test. Therefore, I have reservations.
Lord Freud
My Lords, I thank the noble Baroness, Lady Drake, for pinpointing her concerns around this. Let me try to address those issues. It is important that we try to disentangle the concerns surrounding the previous amendment from this amendment, which represents a fairly technical and, I will argue, wholly benign approach. Clearly this must be done by trustees who have a duty to pensioners and future pensioners. They can change the rules only to facilitate automatic enrolment or to raise the contribution rate to comply with relevant scheme quality requirements, and those changes can be made only with the consent of the employer. So it is an upwards-only adjustment in practice under this amendment—I am not talking about the issues that we discussed under the previous amendment. The trustees must consider the interests of existing members in that decision.
On whether employers will be able to manipulate the certification requirements by transferring workers from one tier of the test to another, which is behind the noble Baroness’s concern, we want to encourage employers wherever possible to retain their existing schemes, which in many cases will have been structured to suit the profile of their workforce and their business model. That flexibility is important to employers. We are therefore making it easier for them, in liaison with their trustees, to meet the automatic enrolment requirements by means such as the self-certification test for money purchase schemes and hybrids.
If a large employer wanted to take advantage of the greater flexibility of the first tier of the test—the 9 per cent contribution tier—it would have to consult the workers if the scheme on offer was an occupational pension and doing so meant a rise in contribution for workers. Any change resulting in a reduction in the amount of employer contribution in respect of a money purchase occupational scheme would require larger employers to consult their affected workers. Employers using contract-based schemes to discharge their enrolment duties would have to alter the individual contracts.
Let me briefly recap the Government’s case for making the amendments. The amendment relating to Section 32 of the Pensions Act 2008 will make it easier for employers and trustees to make improvements to their schemes so that they meet the requirements of the self-certification test. The amendment to Section 30 of the Pensions Act 2008 will give employers greater flexibility where the transitional arrangements for defined benefit and hybrid schemes cease to apply. In such cases, the amendment will allow employers to use personal pension schemes, as well as money purchase, defined benefit and hybrid schemes, as replacement schemes. These two minor and technical amendments will provide employers with greater flexibility.
Lord Freud
“Arrangements where transitional conditions cease to be satisfied
In section 30(5) of the 2008 Act after “money purchase scheme” insert “or personal pension scheme”.”
“Power of trustees to allow early access to lump sums
After section 32 of the 2008 Act (power of trustees to modify by resolution) insert—“32A Power of trustees to allow early access to lump sums
Providing that the jobholder has at least £10,000 in his or her pension scheme, upon application to the trustees of the qualifying scheme or automatic enrolment scheme a jobholder may withdraw up to 25% of the total sum accrued at the time of the application in the jobholder’s NEST.””
Lord McKenzie of Luton
The amendment is not moved, although I think that my noble friend Lady Hollis wants to bring it back on Report.
Baroness Turner of Camden
Baroness Turner of Camden
My Lords, my amendments are an attempt to deal with the Government’s intention to replace the retail prices index with the consumer prices index as the indexation for pensions in payment. That was raised on Second Reading, and I am sure that everyone is aware that a lot of people have already voiced opposition to that because it is felt that people will suffer very much in their expectation—mostly people who are already receiving pensions.
I understand that people in the public sector have already received notification that they will be receiving the lower amount rather than an increase in line with the retail prices index. A number of them feel very angry about it. My own sister, who is a retired teacher, has phoned up to complain to me about it, and I am not surprised. I have already read quite a lot of material from the TUC, which supports the view that it is not fair. That view has also been expressed extensively by Saga, which has been writing to a number of people on the Committee about the Bill, and I support what it has been doing.
The situation regarding public sector workers is that although there is a lot of talk about public sector pensions being gold-plated and so on, many people working in the public sector do not get paid large amounts of money. Women in the public sector are usually on salaries of between £4,000 and £5,000, and even the loss of a relatively small amount of money means quite a bit to people at that sort of pension level.
With regard to the private sector, the Government have been instructing the pension providers that they have to inform their pensioners that in future the increases will be in relation to the consumer prices index rather than the retail prices index, and their obligation is simply to notify people that that will be their situation. I believe that that has already happened in the private sector. I understand, however, although I am not sure, that if your pension is provided on contract and the contract provides for retail prices index increases, that will not be interfered with by the Government’s new ruling.
One of the reasons why people feel it is so unfair is that we are now in a situation where inflation is running at 4 per cent and everyone expects it to go up—the papers are full of information about how we can expect the cost living to rise substantially—and at the same time many of the people in this category, who were advised to save and have been saving, find that their savings are not worth what they once thought they were, because there has been nothing much by way of interest on their savings. Many of these older people feel that they are losing out twice; they are not getting what they expected with the retail prices index increases, while at the same time the savings that they have been prudentially putting aside are not going to produce the kind of increases or support that they had expected to receive. For those reasons, both Saga and the TUC have been pressing for this to be reviewed. The situation is not fair, and I hope that the Government will be prepared to look sympathetically at their request.
With regard to Amendment 48A, with which my two amendments are grouped, I understand that my noble friends Lord McKenzie and Lady Drake are anxious to soften the blow a bit by providing for the whole thing to be reviewed. I understand that and I respect what they are trying to do. Nevertheless, I want the Government to look again at the whole issue of the retail prices index, as there is a lot of concern about it. I beg to move.
Lord Boswell of Aynho
My Lords, I oppose the amendment. I should perhaps declare that I, too, have members of my family—two daughters, in fact—who are in public sector pension schemes, and of course one hears comments of the sort that have been honourably and properly recorded by the noble Baroness. There are many people in the private sector who for a variety of reasons, not necessarily where their schemes have collapsed into the Pension Protection Fund, are feeling some stress as well. That needs to be said.
I would just say that although I did not respond to the Minister on his remarkable presentation last night with regard to the social security uprating orders, I was actually convinced by it, which I am not wholly sure that I had been until he gave that presentation. It is a change that we have to make, particularly bearing in mind that there are alternative arrangements for retirement pensions which will meet the triple test and will accelerate state retirement pension levels rather faster than the CPI.
I will make one further comment on Amendment 48A and the scheme proposed by the noble Lord, Lord McKenzie of Luton. I understand the motivation, but it is asking for a report on one-hand clapping, as the Zen Buddhists would say. It would be better expressed if it called for a report on the relative impact of the use of the CPI and of the retail prices index. We would then have some measure of comparison. As all noble Lords are aware, historically the CPI has run ahead of the RPI. My noble friend last night made representations about why this was overstating the problem and arguably would overcompensate recipients.
That leads me to make a technical comment of my own, to which my noble friend may want to respond. As one takes the heat off the RPI, it will become less immediately salient, although it will still be used and reportable for a number of purposes. As that happens, given the types of interaction and substitution effects that were rehearsed last night, it may be that it will cease to be of quite the utility that it was. Somewhere at the back of my mind—I must say it while I remember it, and hope that I still can—are my scribbled lecture notes of 45 years ago that I took on the Laspeyres and Paasche indices, and on all the different impacts of these complications. I implore noble Lords not to ask me to explain to the Committee how they work, but I will make the point that as we shift the emphasis to the CPI—that will surely be an irreversible shift, and I have given reasons for supporting the concept—the RPI will move out of focus and could become distorted in the uses for which it is still employed. Perhaps the Minister will give me some assurance that it will retain its integrity even if it is not being used for these uprating purposes.
Lord McKenzie of Luton
My Lords, I will speak to Amendment 48A in this group. I start by acknowledging the criticism made by the noble Lord, Lord Boswell, of the drafting; I very much take his point. I am also intrigued that he can read his notes after 45 years. I struggled today to read the notes that I made yesterday.
Amendment 48A calls for a triennial report to assess the impact of using the consumer prices index as the measure of inflation. It seeks that assessment from, among others, pension scheme members, employers, taxpayers and PPF levy payers. It is an opportunity to reflect on what has become known as the RPI/CPI switch. We stated in the other place, and again in our debate yesterday on benefit uprating, that we cannot support the decision to adopt on a permanent basis the CPI as currently constructed for the determination of benefit uprating and of pension revaluation and indexation. However, if our understanding of the process and legislation is correct, we do not need more amendments to the Bill to secure any change in future—which may help my noble friend Lady Turner. Issues of uprating pensions, including the BSP, S2P, public sector pensions and occupational pensions, are determined annually. These are undertaken by the increase in the general level of prices, which is generally not specified to be RPI or CPI, or indeed any other measure. Therefore, if I am right, a future Secretary of State could take a different view on the most appropriate measure of the increase in the general level of prices, and without the need to change primary legislation. The situation with regard to the PPF is similar. Clause 15 removes references to the retail prices index and substitutes,
“the general level of prices in Great Britain”.
But that does not lock in the CPI for all time. If I am wrong on that, perhaps the Minister will let us know, because we might want to table further amendments on Report. That runs also for the provisions of Clause 14, which my noble friend has addressed.
The change to uprating the various facets of pensions by CPI—subject to statutory caps—will, as we know, have a significant impact, particularly over time. We obviously accept that for the basic state pension, where we support the re-linking to earnings, which will provide the long-term determination of the basic state pension. For private sector occupational schemes, the extent to which the CPI ends up being used for revaluation and indexation depends on the scheme rules, and we support the Government in not pursuing the override. Nevertheless, the updated impact assessment produced by the DWP in February shows that the total cost in terms of reduction in the anticipated value of members’ pension rights—including the stock as well as the flow of pensions—is something like £86 billion, which is a considerable sum. This is not a deficit-reduction saving; it is an almost equal and opposite benefit for sponsoring employers, and there are consequential benefits to the PPF and levy payers.
Lord Freud
My Lords, I thank the noble Baroness, Lady Turner, and the noble Lord, Lord McKenzie, for their amendments, which I will address in detail in a moment. Before I do, I would like to set the context.
The legislation covering statutory increases to private sector occupational pensions requires the Secretary of State to make a judgment about the increase in the general level of prices in Great Britain up to the end of September each year. This judgment forms the basis of an annual order setting minimum statutory indexation and revaluation percentages to be used by occupational pension schemes in the next calendar year. As noted yesterday by the noble Lord, Lord McKenzie, the revaluation order was laid in December last year and the order providing for public sector pension increases will be laid shortly. They are not the subject of the Bill.
Clause 14 could best be described as technical and consequential. It makes changes to important but relatively minor provisions. I know that many noble Lords hold strong views on the Government’s decision to use CPI; it was the topic of extensive debate on Second Reading, and it was discussed at length yesterday. In response to the question of the noble Lord, Lord McKenzie, about how much the hands of a future Secretary of State are tied, I can let him know that he is correct in his presumption that the Secretary of State can take a different view and go back to RPI without a Bill if that is their decision. The CPI is a matter of coalition policy now.
It is not my intention to labour any further the methodology or our reasons for adopting the CPI. I think that that is now a matter of record. I will just pick up the noble Lord on one little point that I cannot resist: he asked whether people really substitute. I tried to explain yesterday how there has been extensive research into whether the practice matches the theory, and the research has all come out to say yes, it does. That is how I respond to that point.
Lord McKenzie of Luton
That was not my own judgment; I am not a statistician. It was the Royal Statistical Society that raised that issue.
Lord Freud
I am most pleased to take this opportunity to inform the Royal Statistical Society of the results of extensive research, which I know it will take into its considerations when it looks at this again.
I think that it would help if I set out exactly what Clause 14 does and why. It does two things. First, it addresses some peripheral references to RPI in occupational pension legislation that need to be removed or amended to ensure that the Government’s decision to use CPI as the best measure of inflation is applied consistently from now on. Secondly, it addresses the so-called “CPI underpin” issue. That arises where a scheme carries on increasing pensions in payment by the RPI. As the statutory minimum is calculated by reference to the CPI, such schemes would be required to track both the CPI and RPI and pay the higher, a bit like the old escalator in the funhouse in Tivoli in Copenhagen. We have made it very clear that statutory increases are minima, and we do not want to discourage schemes from making higher increases. Consequently, the clause before us ensures that schemes that continue to increase by reference to RPI are not subject to this funhouse ratchet effect.
The first reference to RPI is in Section 84 of the Pension Schemes Act 1993. This is a fairly obscure provision that caters for special arrangements in schemes which provide full uncapped revaluation on the whole pension including the guaranteed minimum pension. Clause 14(1) to (3) replaces the explicit reference to RPI in Section 84 with a requirement that these schemes must maintain the value of the pension in line with the rise in the general level of prices. This ensures that Section 84 provides for uprating in the same way as the other pension legislation.
The noble Baroness’s first amendment, reinserting a reference to RPI, effectively does nothing more than revert Section 84(5) to what it already says. It will certainly not restore RPI indexation or revaluation more generally.
The second reference we are addressing in Clause 14 is in Section 40 of the Welfare Reform and Pensions Act 1999. This concerns the indexation of pension credit benefits, which are pension rights deriving from a pension sharing order made as part of a divorce settlement. Clause 14(6) to (8) replaces the existing reference to RPI with a cross-reference to the inflation percentage adopted by the Secretary of State for the purpose of the annual revaluation order. The remaining part of the clause concerns Section 51 of the Pensions Act 1995. Section 51 sets out the requirements for indexation of pensions in payment.
The amendments to Section 51 of the Pensions Act 1995 in Clause 14 will also ensure that where schemes continue to increase pensions by RPI they need not carry out an annual comparison of the RPI increase required under the scheme rules and the statutory increase using CPI and pay the higher of the two. If a scheme increases pensions by reference to RPI, and has done so since the start of January 2011, then it will escape the statutory requirements of Section 51(2). This deals with the CPI underpin issue to which I referred earlier.
The amendments in Clause 14 also make amendments to ensure that Section 51(3) continues to apply as intended now we are using the CPI to measure inflation. Section 51(3) exempts schemes from the statutory indexation requirement where they increase pensions in payment at least by capped RPI measured over an annual period defined in their rules. Inflation for statutory indexation is measured at 30 September, but some schemes want to continue measuring at a different time and that is fine—Section 51(3) currently allows them to do that. The clause has the effect that if schemes increase by CPI, RPI or a combination of the two under their rules, they will continue to be exempt from the statutory indexation requirements. At the moment it is only schemes with RPI rules that would be exempt. All we are doing is making sure that an existing provision, which is very convenient for a number of schemes, is carried forward into a world where some or all pensions in payment will be increased by reference to CPI as well as RPI.
I am afraid that the noble Baroness’s second amendment would undo the part of the clause that allows schemes that increase by reference to CPI to use their own inflation reference period. Again, it will do nothing to restore RPI indexation or revaluation more generally. For that reason, and for the reasons that I set out earlier in respect of Amendment 47, I urge the noble Baroness not to press her amendments.
On Amendment 48A, I stress again that deciding the increase in the general level of prices is an annual duty, and that as the Government have made clear many times over, we believe that the CPI is the most appropriate measure. Publishing a triennial report on the impact of using the CPI will not change that. That is not to say that we are not interested or do not care about the impact—of course we do—but it is important to look at the broader context, not one part of the picture in isolation.
We are also mindful of the impact on private sector pension schemes and their members. That is why we issued a consultation paper in December about the impact of using the CPI on private sector occupational pension schemes. That consultation finished on 2 March and we are currently considering the responses. The noble Lord, Lord McKenzie, has asked when we will be able to share those responses. I can only ask him to show us a little more patience. I think that we have around 150 submissions, and some of them are extremely detailed and complex. We are also conducting social research to investigate the impact of the change from RPI to CPI for statutory revaluation and indexation of private sector pensions. We hope to publish findings from this research before summer.
Baroness Turner of Camden
I thank the Minister for that detailed response. My aim in putting down the amendments was to give voice to a lot of the opposition that has been voiced to me in the letters and complaints that I have received after people have been notified that they are likely to have a different arrangement with regard to indexation from what they have hitherto expected. There is a lot of anger about it, so I put the amendments down. I am not exactly committed to the wording, but I wanted very much to voice that opposition and to say that the people concerned have real worries about what will happen to them and their pensions in future.
I also thank my noble friend Lord McKenzie for what he had to say in support of his amendment. In default of getting anything like my amendment on to the statute book, his amendment seems very worthwhile because it means that the situation has to be reviewed and there is an attempt to ensure that what has happened is placed under survey at intervals. If it seems to be what you might call a soft answer, at least it is an improvement on what people think that they are facing in future.
I will read carefully what the Minister has said. I found it interesting that modifications can be made, surveys are conducted and so on. That is very useful and I will look at it carefully.
Lord McKenzie of Luton
Before my colleague withdraws her amendment, and I certainly do not intend to press mine, it seems a bit hard for the Government to say that their policy is fully evidence-based when they are only just gathering the responses to the survey and will take some while to analyse the consequences. The survey of the consequences of the switch to CPI for occupational schemes is an important one, and one might have hoped that the Government would wait for that analysis and research before they committed to the switch long-term.
Lord Freud
The consultation exercise informs how we do these things in some detail in regulatory terms, but it does not affect the decision and direction of travel.
Baroness Drake
(c) the amount available must be no less than that available on the open market option.”
Baroness Drake
My Lords, this is a probing amendment to understand fully the implications for scheme members in cash balance schemes that are not contracted out or where members have not accrued benefits on a contracted-out basis. This clause removes the requirement to index pensions that come into payment at a future date under cash balance schemes.
I have two concerns. In the first instance, cash balance schemes usually fall into one of two types. The first is cash balance with guaranteed conversion terms, whereby the pension pot at retirement is defined, based on the proportion of salary set aside each year and the guaranteed rate of interest earned, and the pot is converted to pension on guaranteed terms that are set by the scheme at an agreed point before retirement. Once in payment, the amount of pension is guaranteed. The second type is a cash balance scheme with open market annuity, whereby the pot is converted to pension on open market annuity rates and, once in payment, the amount of pension is guaranteed.
My concern is that, under the open market option, an individual has a choice between a level and an indexed pension, whereas the effect of the clause—on first reading of the Bill—could require an individual in a cash balance scheme to accept conversion of their savings pot into a pension on terms that were potentially less favourable than those available on the open market option, given that they could not have access to an indexed pension. Hence my amendment, which seeks, on removal of the indexing requirements, to anchor the conversion rates in cash balance schemes to being no less favourable than those available on the open market.
My second concern arises from the removal of the indexation requirements from cash balance schemes that are not contracted out, as the Bill states. Given the Government’s aspirations to accelerate the integration of the basic state pension and the state second pension into a single state pension, which will result in all schemes being contracted in, what would be the implications for scheme members who had not yet converted their assured sums into pension from their previously contracted-out cash balance schemes but had a reasonable expectation of indexation? I beg to move.
Lord Freud
My Lords, the amendment would require that an annuity without indexation bought by a cash balance scheme member or the pension provided by the scheme must be no less than that available on the open market option. In moving the amendment, the noble Baroness, Lady Drake, raises an important issue.
It is important that individuals can shop around to get the best type of annuity for them at the best available rate. This will affect their level of income for the rest of their lives. This clause, which gives members of cash balance schemes more choice about the shape of the income that they take in retirement, will support this. However, in compelling members to take a pension of no less than that available on the open market option, there arises a practical difficulty.
Annuity pricing is now highly individualised. Most providers offer rates by postcode. Enhanced and impaired life annuities also offer significantly higher rates for those with health conditions or lifestyles that are likely to reduce their life expectancy. This makes it difficult to establish what the right open market rate for comparison should be and very difficult for schemes to establish a workable process to find out what a member is likely to be offered on the open market.
In addition, different types of annuity offer different starting payments. For example, an individual might wish to buy an annuity with a guarantee period. This is likely to give a slightly lower payment, but it gives the member a guarantee that the annuity will continue to be paid if they die before the end of the guarantee period. This is unlikely to represent the best available rate on the market, but is it right to deprive the individual of this choice? For these reasons, I believe that any amendment of this nature would be unenforceable and, as a consequence, unworkable in practice.
I would like to pick up one of the questions that the noble Baroness asked with reference to further reforms to the state pension. It is too soon to speculate about those—certainly, it is too soon for me to speculate about them. We believe that it would be too difficult in practice for schemes to separate out periods of contracted-out service. The same scheme member may have periods of contracted-out and non-contracted-out service. There is also a danger of the possible franking of one benefit against increases to another. All those schemes that have been contracted out on a defined contribution basis no longer have to provide an indexed annuity. Schemes that are contracted out on a defined benefit basis, either where a guaranteed minimum pension is payable or on a reference scheme test basis, have to provide indexation to the relevant level. With that explanation, I urge the noble Baroness to withdraw the amendment.
Baroness Drake
I thank the Minister for that response. I have sympathy with what he says because I would be the last person to want to discourage cash balance schemes, as they allow for a degree of sharing and in today’s world one does not want to discourage that. I can see the compelling argument and I understand the point about the annuity pricing market becoming more individualised, which makes it difficult to establish an open market comparator, especially where a scheme may be wanting to set conversion terms. However, I remain concerned, as it is desirable for individuals to have the choice to access indexing, otherwise they are denied an opportunity to lay off some of their inflation risk. Given that in a DC world they bear so much risk, it would be a little sad if the unintended consequence of this Bill was to deprive to a greater extent than currently exists a group of people who would otherwise have exercised an option to go for indexing and to give themselves some protection against inflation.
I did not expect the Minister to speculate on future state pension arrangements, but I flagged up the issue as sometimes these things are forgotten. Those who have worked with me will know that I consistently flag up the impact of removing contracting out from the system, not least in public service pension schemes. Having said that, I beg leave to withdraw the amendment.
Lord McKenzie of Luton
Lord McKenzie of Luton
My Lords, I wish to speak briefly to Amendment 48C. I stress that it is simply a probing amendment designed to get a better understanding of what the alternative to obtaining a current actuarial valuation will entail.
Currently, determination of the funding position has to be underpinned by a fresh actuarial valuation. This supports the decision of whether the board must accept responsibility for the scheme. Perhaps the Minister can say a little more about the circumstances when the alternative approach is expected to come into play and the type and range of information that might be used in place of the actuarial valuation. The provisions in new subsection (5C) require the board of the PPF to issue a statement setting out how it will make determinations. Can the Minister give us a flavour of what the statement is likely to include? To what extent is it envisaged that reliance would be placed on third-party data? Generally, what level of assurance will be looked for in the use of such data?
I should stress that the purpose of this is not in any way to challenge the proposals but just to get a broader understanding of what is envisaged. It is presumed that these arrangements have been positively sought by the PPF and will help its operational efficiency. I am a fan of the PPF. When we discussed some SIs last week, I took the opportunity to say that the PPF has made a considerable contribution to the current pensions landscape. It is a very professional organisation and it is in that spirit that I move this amendment. I beg to move.
Baroness Garden of Frognal
My Lords, I will first speak to the government Amendments in this group and then respond to the amendment tabled by the noble Lord, Lord McKenzie. Clause 17 and Schedule 4 make a number of amendments to legislation in the Pensions Act 2004 and the Pensions Act 2008 that governs the operation of the Pension Protection Fund. They have been developed with the Pension Protection Fund and reflect the experience gained in the light of live running since April 2005.
Paragraphs 20 to 26 of Schedule 4 replace an existing regulation-making power within paragraph 25A of Schedule 7 to the Pensions Act 2004. Regulations made under the new powers would enable a person to postpone payment of their pension compensation past their normal pension age. Paragraphs 27 to 33 of Schedule 4 make amendments to the Pensions Act 2008 in parallel to those in paragraphs 20 to 26.
Regulations made under the new powers would enable a person who is entitled to pension compensation by virtue of pension compensation sharing to choose to receive compensation from a later date than normal benefit age. To explain further—in response to the noble Lord—for someone who chooses to postpone payment of pension compensation, three things would happen. First, the pension compensation cap would apply as at the time the person first becomes entitled to pension compensation, which would be their normal pension age. Secondly, revaluation would apply up to a member’s normal pension age. Thirdly, the board of the Pension Protection Fund would provide an appropriate increase in pension compensation when it comes into payment, calculated on an actuarial basis to take account of the postponement of the start of payment.
Amendments 49 to 52 amend the legislation in Schedule 4 dealing with the commutation of pension compensation. We intend to use these powers to make regulations to provide a person with the option to commute a portion of their pension compensation for a lump sum at the end of a period of postponement.
This group of amendments enables the Government to make regulations that will provide people with an additional flexibility. Current legislation already allows a person to decide to commute to a lump sum part of their pension compensation. All in all, this provides a person in the Pension Protection Fund with a good deal of flexibility to decide how and when to take their pension compensation.
I turn now to the amendment in the name of the noble Lord, Lord McKenzie, about funding determinations to be made by the board of the Pension Protection Fund and the degree of reliance on independently assured data. For a scheme undergoing assessment for entry to the Pension Protection Fund, an actuarial valuation of a scheme’s assets and protected liabilities under Section 143 of the Pensions Act 2004 will no longer be required in all cases. A scheme’s protected liability is the cost of providing benefits equivalent to pension compensation, any non-pension liabilities of the scheme and the estimated cost of winding up the scheme. Instead, the board of the Pension Protection Fund will have the power to determine whether a Section 143 valuation scheme is required or whether it can use other information that it has in order to decide whether the scheme should transfer into the Pension Protection Fund.
Practical experience since the Pension Protection Fund opened for business in April 2005 has shown that in a number of cases there is already sufficient independent information held about a scheme to allow the funding position to be accurately assessed without requiring a fresh actuarial evaluation. For example, a valuation by an actuary under Section 179 of the Pensions Act 2004, undertaken for the purposes of calculating a scheme’s pension protection levy, may be used. These changes will avoid schemes incurring the expense of an actuarial valuation where one is not necessary for a fair decision to be made.
The noble Lord is concerned to protect the interests of members of schemes that will not undergo full actuarial valuation under Section 143. I should make it clear that the Government are not intending to change outcomes for members; rather, these changes are intended to avoid costs where they are not necessary to ensure fair outcomes for members.
New Section 143(5)(c) requires the board of the PPF to set out how it will make determinations when it does not commission a full actuarial valuation. This statement will have to take account of any requirement set out in regulations under Section 143(4). We expect the PPF to set out examples of the sort of information and methodology that it would use in place of a full actuarial valuation in this statement so that it is clear how a meaningful judgment of a scheme’s funding position at the assessment date—that is, the date when the scheme began assessment for PPF—was made.
The Government have no problem with requiring the PPF to make evidence-based decisions. Indeed, the board of the PPF is clear that it will be appropriate not to commission a full valuation only where there is adequate alternative evidence. However, I suggest that the more appropriate place to detail any legislative requirements for that evidence is in regulations under subsection (4) rather than in the Bill. As an example of when an alternative determination would be used, it would be where a scheme was very clearly underfunded on the basis of existing information but not where there may be some doubt about it.
I welcome the noble Lord’s interest in the changes to requirements to undertake actuarial valuations in all cases where a scheme is being assessed for entry to the Pension Protection Fund, but I hope that the explanation that I have given is sufficient for him to withdraw his amendment and that the Committee will be prepared to accept government Amendments 49 to 52.
Lord McKenzie of Luton
My Lords, I thank the Minister for her full response to my amendment. Indeed, I welcome her to her first session at the Dispatch Box on pension issues—the first of many, I am sure. The explanation that she has provided in response to my amendment is totally satisfactory. I think that I understand it fully and it has been a helpful clarification of what is in the Bill. The government amendments are a sign of the growing practical experience and maturity of the organisation. I have no particular points to raise and am happy to support the amendments. I beg leave to withdraw the amendment.
Lord Freud
“In paragraph 24(1) (commutation of periodic compensation) for “becomes payable” substitute “commences”.”
“( ) In sub-paragraph (5)—
(a) in paragraph (a) for the second “the” substitute “each”,(b) omit the “and” at the end of that paragraph, and(c) after paragraph (b) insert—“(c) for the purposes of sub-paragraph (2), the definition of “underlying rate” in the case of periodic compensation under paragraph 5, 8, 11 or 15 applies as if the reference in paragraph (b) of the definition to the amount mentioned in sub-paragraph (3)(aa) of the paragraph in question was a reference to that amount reduced by the commutation percentage, and(d) that amount (as so reduced) is attributable to post-1997 service and pre-1997 service in the same proportions as that amount would have been so attributable had no part of the periodic compensation been commuted.””
“In paragraph 9(1) (commutation of periodic compensation) for “becomes payable” substitute “commences”.”
“( ) In sub-paragraph (7)—
(a) after “references in” insert “paragraph (a) of”, and(b) at the end insert “(and paragraph (aa) of the definition applies accordingly).””
Lord German
“Occupational Pension Schemes (Investment) Regulations 2005
(1) The Secretary of State must publish guidance for occupational pension schemes on the implementation of regulation 2(3) of the Occupational Pension Schemes (Investment) Regulations 2005 (statement of investment principles).
(2) In particular, such guidance must cover the type of information which may be provided under—
(a) regulation 2(3)(b)(vi) (the extent (if at all) to which environmental, social and ethical considerations are taken into account in the selection, retention and realisation of investments), and(b) regulation 2(3)(c), (the fund’s policy (if any) in relation to the exercise of rights including voting rights, attaching to their investments).”
Lord German
My Lords, I shall speak also to Amendments 54 and 54A. The first two of these amendments are identical because they relate to two different sets of regulations. In that respect they could be seen as the same, but they relate to two sets of existing regulations. All three are probing amendments because I want to see the Government’s view on these matters, which are important to pension fund members.
The amendments seek to do two things. First, they suggest guidance to help pension funds ensure that they are meeting the spirit of the law, not just the letter, when it comes to explaining their policy on environmental, social and governance issues, and on the exercise of shareholder rights. It is now 10 years since these rights were written in to law. There is a need to go beyond the generic statements that characterise many statements of investment principles to ensure that funds’ policies give their members meaningful information.
Secondly, the amendments suggest enhanced reporting on how these policies have been implemented in practice. I am grateful for the research by FairPensions and others which suggests that general statements to the effect that ESG issues are taken into account are not always matched by effective implementation. In addition, members can find it very difficult to acquire information about the exercise of shareholder rights attaching to their savings—for instance, information on how their fund voted on a particular shareholder resolution. The stewardship code makes it clear that asset managers should disclose their voting records. It also makes it clear that asset owners have a role to play in ensuring effective stewardship. If the purpose of stewardship is to ensure that the assets of the ultimate owners are safeguarded, there must be accountability to these owners on how stewardship responsibilities are being exercised.
Asset manager disclosure alone will not achieve this. Pension funds also need to play their part. There is no reason why this should amount to a huge increase in red tape. In many cases, the pension fund would need only to provide a link on its website to its asset managers’ disclosures. This would be a very small additional burden on funds, but an enormous improvement in accountability for members, whose money ultimately is at stake. The problem is that often funds state simply that decisions are delegated to fund managers, with no transparency about the managers’ voting intentions. Examples have been given to me of funds that do just that. Funds often direct members to their statement of investment principles, which is unlikely to provide any useful information that has been requested on any matter.
The third problem is that funds often respond as though taking into account an environmental issue, which might be the one being questioned, is in opposition to their fiduciary duty to maximise returns—even though the matter in question is solely business-focused, they are being asked only for disclosures about the financial risks associated with the projects, and the questions are backed by a number of institutional investors. This betrays a continued misunderstanding of responsible investment, and of the ways in which environmental, social and governance issues can be material to financial returns. Members increasingly bear the investment risk associated with their pension savings, and should have corresponding rights to scrutinise the management of that risk. This is particularly important given the growth of DC schemes.
There is an increasing consensus that social and environmental considerations are financially material. That is why a report from the United Nations Environment Programme finance initiative highlighted the reasons why trustees are required by law to take advice from investment consultants when preparing their SIPs. The report suggests that a tick-box mentality on the part of these investment consultants is a key reason for the inadequacy of current disclosures. Many consultants still regard the ESG as a client-driven, ethical preference and do not consider that they have a proactive responsibility to raise these issues with pension fund clients.
The amendments require the Government simply to provide guidance. While I appreciate that they have the power to provide guidance, I question whether they should provide guidance rather than simply have the power to provide it, and what matters might be included in that guidance—for example, a generic statement might say that the fact that a fund takes ESG issues into account will not normally meet the spirit of the law; that the statement should relate to the fund’s particular approach to circumstances and issues at stake; and that it describes elements of a best practice statement on social, environment and ethical issues. There are a range of areas that could be included in such guidance. The elements of a best practice statement on the exercise of shareholder rights, for example, might include whether it is the fund’s policy to vote all shares held; whether the fund delegates voting decisions to asset managers; and, if so, details of any specific instructions given to the asset managers, or the circumstances under which the fund reserves the right to make voting decisions itself. The fund’s policy on dealing with any member inquiries, of course, is particularly important as we move forward in this area.
We do not accept that the inadequate application of existing requirements makes for more prolific and prescriptive regulations. We do believe that there is a sensible approach to a set of guidance which will make the role of the fund, and the fund members, more important. We recognise that that guidance would not strictly require primary legislation, and so these amendments are probing in their character.
Finally, part of the purpose of public disclosure is to ensure better accountability to ultimate owners. The average pension saver cannot be expected to know which asset manager their pension fund uses. If only the asset manager discloses, the net improvement in transparency for the saver at the end of the investment chain is likely to be small. In most cases we think that all that would be required is for pension funds to provide that link to their asset manager’s disclosures, probably on their websites. In other words, members should be signposted to the relevant information. On the basis that this set of information would benefit transparency of process and put some flesh on the bones of the existing legislation, I beg to move.
Lord Boswell of Aynho
I rise very briefly to support my noble friend Lord German, or at least his line of thinking. I have perhaps one qualification or addition to the presentation that he has given, in relation to the role of trustees. I have already declared to the Committee my interest as a pension trustee. I can assure the Committee that my colleagues and I are taking an interest in the matter of ethical and otherwise acceptable investment schemes as part of our dialogue with the fund managers who represent us and the interests of beneficiaries. I think that a little more could have been said about the role of trustees as a necessary link, in most cases, between the former employees and the beneficiaries on the one hand and the investment managers on the other. This is something that we should all be in, and nobody should cop out of it.
My second and perhaps also substantive point is to support my noble friend’s observations about the business utility of all this. I think that the Committee will know that I have a background in a number of issues connected, for example, with disability and other aspects of diversity. In dealing with the private sector I have found over the years that, on the whole, those businesses that take a mature view and consider their long-term interests actually understand the business case for awareness of these considerations. They are not after the big buck. Their reputation and their business attractiveness benefit, with a long-term beneficial result.
When George Cox was chief executive of the Institute of Directors, I remember doing a number of presentations with him on disability issues. He used to come up with the deathless phrase, “We do this kind of thing because we are the kind of company we are”. That seems to me a very good motto. That is the kind of company that as a trustee I would like to invest in, and that as a beneficiary I would like to feel that my trustees and my investment managers were steering me towards. I do not think that this is a matter of political contention; I think that my noble friend has been right to ventilate it.
Baroness Drake
My Lords, I have considerable sympathy with the amendment moved by the noble Lord, Lord German. Notwithstanding the impact of the events of 2008-09 on regulators around the world, which are no doubt focused much more acutely on governance, with the shift from defined benefit to defined contribution pension provision, which the noble Lord referred to, and the imminence of auto-enrolment, the design of the default investment funds and the investment principles surrounding them are going to gain more attention. The issue of how shareholders, particularly institutional shareholders, approach their responsibilities as owners of assets is coming under increasing scrutiny by the Government, regulators, the members of pension schemes and those who discharge fiduciary duties on their behalf.
Corporate governance, principles of stewardship and interactions between institutional shareholders and companies are increasingly considered as a coherent whole in exercising ownership rights. As the noble Lord said, defined contribution schemes in money purchase and in personal pension schemes in future shift the risk on to the individual. Although the Myners principles have improved decision-making, achieving best practice in the investment governance of pension schemes—both trust-based and, particularly, contract-based, which I will come back to—still poses a challenge.
We have seen evidence of that concern in the Pensions Regulator’s recently published consultation on investment governance in DC schemes, which included a table of accountabilities. The table aims to define and clarify the roles and responsibilities of each decision-maker in each part of the investment governance chain, but I read it again last night and, unless I missed this, it does not refer explicitly to social and ethical considerations or to exercising voting rights. Close to my heart, NEST, and its predecessor PADA, published their own document on exercising responsible ownership in a low-charge scheme. Discharging this governance in the context of maintaining low charges is equally important.
As the noble Lord, Lord German, referred to, the Financial Reporting Council published the UK stewardship code in July 2010, which is designed to lay out the responsibilities of institutional investors as shareholders and provide guidance as to how those responsibilities might be met. Pension fund trustees are strongly encouraged to report how they have complied with that code. As a conscientious pension fund trustee, I have attempted to do just that, and my own experience suggests—here I concur with the noble Lord, Lord German—that if the code is to bite, trustees will need a great deal more guidance on how to comply with it if box-ticking is not to continue to be the method of compliance with these standards.
The Occupational Pension Schemes Investment Regulations, which the amendment refers to, say clearly that when setting out their statement of investment principles, trustees should identify,
“the extent (if at all) to which social, environmental or ethical considerations are taken into account in the selection, retention and realisation of investments; and … their policy (if any) in relation to the exercise of the rights (including voting rights) attaching to the investments”.
It is clear that this is an area where guidance and best practice are growing in importance. Because of the political risk that Governments face, with the biggest experience of asymmetrical paternalism that we are about to see, I bet my bottom dollar that this will grow and grow. If you transfer responsibility to the individual, politically Governments have a responsibility to ensure that government frameworks are up to the job.
Clearly, there are issues around how trustees can fulfil these responsibilities. One issue that we must address—I will not dodge it—is how one can be an effective, active asset owner while maintaining low charges, and how one can effectively monitor stewardship policy when one selects passive funds. Although I am absolutely committed to the highest level of governance at every stage of the investment chain, and believe that the ability of trustees to discharge their disclosure requirements in electronic form will help, these things must always be proportionate, because in a DC world it is the individual who bears the charges. I would not want a scenario in which we say that the good news is that we have gold-plated system of governance on disclosure, but the bad news is that it will cost X per cent. Therefore, we need to look at how all the players, including the fund managers, can raise the overall level of governance.
I come back to the providers of contract-based pensions. With the shift away from DB to DC, we are seeing a big shift away from trust-based DC to contract-based provision. Therefore, if we talk only of a model for how the trustees will discharge their governance function in this area, we will miss an ever-growing part of the pension provision market. A big issue, with which I know others are concerned, is who in a contract-based provision world should accept the fiduciary responsibility of designing the default fund or deciding how investment governance should be discharged. This takes us into areas where the Pensions Regulator has no reach. The guidance and regulatory framework must catch up with the shift from trust-based to contract-based provision, because in a contract-based provision world there are no trustees, unless there is a master trust, on whom to place clearly the fiduciary duty. It is clear that the Government will need to look both to the Pensions Regulator and to the FSA or their successors to raise the governance standards in the way that the noble Lord, Lord German, seeks through his amendments.
Lord Freud
My Lords, I thank the noble Lords, Lord German and Lord Stoneham, for tabling these three amendments. They encourage trustees and managers of occupational and stakeholder pension schemes to engage more fully with environmental, social and ethical considerations in the selection and retention of their investments. These are important issues. They resonate with me personally. I remember writing many a happy Lex column in the 1980s on the structural issue. The issue is the separation of the responsibilities of ownership and the attraction of investment returns in the marketplace. Trying to get them back together has proved very difficult. A lot of effort has been thrown at it in the past decade, with the Myners principles and the IGG.
The amendments would have a similar effect on the trustees and managers of occupational and stakeholder pension schemes. Therefore, we should look at the amendments together. There has been a consensus in many previous debates on social and environmental issues that companies perform better when their activities are monitored by shareholders. Therefore, it is important for pension funds and their investment managers to be transparent in publishing their approaches to such issues in their statements of investment principles. That is why this Government, like the previous Government, have been open to suggestions on how to improve this process. In the end, it is a matter for managers and trustees to determine the level at which they engage and what is appropriate for them. It is a statement of the obvious that small schemes, in particular, may not be able to take account of governance issues to the extent that large schemes can.
Lord German
My Lords, I thank my noble friend for those comments. I dread to think of the asymmetric paternalism to which we keep referring. We shall probably have to continue to do so now, because if I can interpret my noble friend’s final remarks as meaning that he and the Government will give active consideration to the sorts of guidance that might help the companies, pension funds and their members to achieve the goals that we have elaborated on, I am very grateful indeed.
As the noble Baroness said, the move from pension trustees to contract-based schemes with trustees will change the fabric of the pension world. I hope that the pension fund for which I am a trustee has sought to get these matters dealt with more swiftly. However, given my own experience, I am not certain that the regulations as framed guarantee that members will get access to all the information on voting rights. I am grateful for my noble friend’s comments, which I will take in the spirit that I described. On that basis, I beg leave to withdraw the amendment.
Lord Mackay of Clashfern
“(4A) The appropriate Minister must not make regulations under this section where the effect of those regulations is either—
(a) to impose an obligation on the person who would be the recipient of the relevant benefits to make a contribution to the cost of those benefits, when there was no such obligation in the person’s original contract of service as a judge; or(b) to increase the level of any such contribution to a higher level than that specified in that person’s original contract of service, except where the increase is in accordance with the terms of that person’s original contract of service and the increase is authorised in line with the consumer price index.(4B) Where the appropriate Minister makes regulations in breach of subsection (4A), those regulations shall be void and of no effect only to the extent that they are in breach of subsection (4A), or consequential on such a breach.”
Lord Mackay of Clashfern
My Lords, this amendment, which bears my name as well as more distinguished names, seeks to follow up the point that I made at Second Reading about the situation of the judiciary in relation to their terms of service. My submission was, and is, that it is a principle of our constitution as it has evolved that the terms of service of a judicial officer shall not be changed to his or her disadvantage during their term of office. In response to that, the Minister who was then replying—not my noble friend Lord McNally but the noble Lord, Lord Freud—said that judges are subject to tax. Of course, but that is not a part of their terms of reference. The arrangements for taxing judicial remuneration and emoluments are absolutely free of any restriction of the kind for which I am arguing.
Secondly, the Minister said that there is already a provision for deduction in respect of dependants’ benefits. However, that is expressly provided for in Section 9 of the 1993 Act, but that makes no provision for any kind of deduction in respect of the judge’s own pension. That is sought to be introduced here for the first time. Undoubtedly, it is a provision adverse to the judge in respect of the terms of service that he undertook.
In this connection, one has to remember that, generally speaking, a judge takes office until he reaches the retiring age, when he must demit office. Apart from that, he is entitled to remain in office on the terms on which he was appointed, subject, of course, to upward changes that may be made during that time. However, in my submission, nothing adverse to his terms of service is appropriate. That does not mean that judges should not be called on to take part in any kind of tax regime that deals with the present situation. Tax is completely free as far as this restriction is concerned. In my submission, this restriction applies to the terms of service of the judiciary and I believe that it is sound. Apart from anything else, I have tried to demonstrate that from the fact that, when I introduced the 1992 Bill, which became the 1993 Act, we made it clear that it did not apply to persons already in appointment unless they elected to join the new scheme of the 1993 Act.
I believe that this restriction is generally recognised. For example, the Latimer House principles embody this situation. Perhaps I may illustrate the point by quoting from the constitutions of some Commonwealth countries. Section 125(2) of the constitution of India states:
“Provided that neither the privileges nor the allowances of a Judge nor his rights in respect of leave of absence or pension shall be varied to his disadvantage after his appointment”.
One can understand the importance of that in the constitution of India, where judges have played a very important part in the development of the rights and privileges of that great country. Article III, Section 1 of the constitution of the United States states:
“Judges … shall … receive for their Services a Compensation which shall not be diminished during their Continuance in Office”.
The constitution of Ireland states:
“The remuneration of a judge shall not be reduced during his continuance in office”.
Incidentally, in 2009 the Irish Government introduced a levy in respect of public service. However, they exempted judges from the levy because of this provision in their constitution. Article 176 of the constitution of South Africa, where judges again played an important part in the development of the country, states:
“The salaries, allowances and benefits of judges may not be reduced”.
Our amendment simply gives effect to that. It does not mean that judges are exempt from anything else, but it does mean that their terms of service cannot be altered to their detriment during their service. I am not arguing that new judges should not be subject to this provision. That is a separate matter, which has to do with recruitment—I am glad that I take no responsibility any more for that. I am arguing only that judges already appointed and presently in service should not have their terms of service as judges altered to their detriment during that service.
Our amendment allows also for an upgrading of the contributions in accordance with a formula. We are not wedded to any particular formula. The provision would be useful in the future and would avoid the need to make a lot of different orders. It would also mean that people would know, when they took office, what the position would be.
This is an important aspect of the constitution. The noble and learned Baroness, Lady Hale, speaking in the House of Lords in a case against the Attorney-General of Trinidad and Tobago, recognised that the security of emoluments is an important guarantee of the independence of the judiciary. I beg to move.
Baroness Murphy
My Lords, I added my name to the amendment. First, I declare my total lack of personal interest in the matter. I am not a judge, I am not married to a judge and I have no judges in my family. However, I do count many judges among my friends. I have often been up before judges—in a professional capacity, I hasten to add. As a result, I have developed an enormous admiration for the judiciary of this country. The quality of their decision-making, their willingness to be unpopular and their independence from the subtle and not-so-subtle pressures of the Executive are qualities that we should treasure.
What is proposed in Clause 24 is a short-term crowd pleaser that will have an impact far beyond what is presumed. It is in direct contravention of internationally agreed guidelines on the protection of the independence of the judiciary, as the noble and learned Lord, Lord Mackay of Clashfern, so eloquently outlined.
Let us face it, these proposals could lead to a judicial pay cut in real terms of up to 10 per cent. I realise that there may well be little sympathy around the House for what I am saying, in the light of the fact that many people in the public and private sectors are taking serious pay cuts and we are debating how pensions will be arranged in the future. It is difficult, but this is a very particular case. The Government’s impact assessment acknowledges that the key risks are that the impacts of this measure are as yet unknown—as are the cumulative effects of existing and future policy decisions about judges’ pay and pensions—that the assumed behavioural response that it would make no difference to recruitment might not apply and that the measure may lead to negative impacts on judicial recruitment, retention and performance.
I wish to deviate slightly from this issue. Research carried out in 2008 by Professor Dame Hazel Genn of University College London found that senior practitioners—solicitors and barristers—are deterred from applying for judicial roles, temporarily or permanently, by practical issues relating to judicial working conditions that include not only geographical and jurisdictional deployment of the senior judiciary but their salary, workload, location, support, patterns of working and general flexibility. We know that it is difficult enough to persuade a top commercial QC earning £2 million a year to accept a judicial appointment, but frankly they are not the judges whom I am worried about. I am far more worried about those lawyers, barristers and especially solicitors, many of whom are women or from ethnic minorities, who cannot see the advantages of entering the judiciary now because of the poor working environment and rewards, but who are attracted to the pension arrangements that would allow them to retire after 20 years. I remind noble Lords that this is not a job that you can enter as an apprentice; you must be a mature and experienced person in the first place.
People say that the arrangements are generous, but they are actually nothing like as generous as for those who remain as solicitors or barristers. There is the difficulty that when practitioners are at their highest earning potential, say in their 40s, they are obliged to seek part-time judicial experience if they want to progress up the ladder. Few are persuaded now. What will this sudden drop in take-home pay do to the application level? It is not the money alone; it is the signal of being undervalued by an Executive looking for PR advantage, but these numbers will make precious little difference to this nation’s debt.
At a time when we are beginning to see the fruits of the work of the Judicial Appointments Commission in appointing more women and people from ethnic minorities, under the admirable chairmanship of the noble Baroness, Lady Prashar, it seems particularly insensitive to throw a spanner in the works with this unnecessary piece of legislation. The experience needed for a High Court post means that only 20 per cent of the pool of eligible senior lawyers are women and only 5 per cent are people from a black or other ethnic minority background. However, boosting numbers of women and other groups is not just a matter of time and a growing pool. One big disincentive is the earnings cut when becoming a member of the judiciary. People marry later, and people in their 50s still have significant financial commitments until late on—commitments to children do not go away.
Let us think back to the last time the Executive attempted to cut judicial salaries. It resulted, among other things, in the following judges’ memorandum and the eventual restoration of salaries. It stated:
“It is we think beyond question that the judges are not in the position occupied by Civil Servants. They are appointed to hold particular offices of dignity and exceptional importance. They occupy a vital place in the Constitution of this country ... It has for over two centuries been considered essential that their security and independence should be accounted inviolate ... In this matter, our country has set an example to the world, and we believe that the respect felt by the people for an English Judge has been partly due to his unique position, a feeling which will survive with difficulty if his salary can be reduced or if he were an ordinary salaried servant of the Crown”.
Clause 24 raises serious concerns in my mind about placing the power to alter judicial pay of sitting judges after appointment in the hands of the Executive. This should be a matter of concern among those who take an interest in judicial independence. There has been little notice of or consultation on that, or any serious look at the real impact.
It is also unclear whether the proposal would impact on the maximum contribution into the judicial additional voluntary contribution scheme, which currently has a 15 per cent ceiling on contributions, with resulting loss of pension in old age as well as lost salary during service. I ask about that because it is especially important for young judges who might not have acquired pensions in earlier parts of their career. If the proposed statutory contributions reduced the amount that one could make voluntarily, it might well significantly reduce the pension available under the voluntary scheme. I hope that the Minister can clarify that for me.
When any judge accepts appointment, the basis for that appointment is that, however successful the individual may have been in his or her previous career, he or she may never return to it. Financial security and pension provision are an essential part of the decision whether to accept appointment. That is particularly the case with the 52 masters who are on the lowest salary band of the judiciary. They earn the same as a basic NHS consultant salary or approximately two-thirds of what a family GP earns. They are not generously paid for the level of responsibility that they carry and many will not serve 20 years to maximise their pension.
I echo what the noble and learned Lord, Lord Mackay of Clashfern, said about the internationally accepted constitutional safeguards for judicial independence since at least the Act of Settlement in 1701, with restrictions on post hoc adverse variation of judicial terms of service. Those were incorporated into Latimer House guidelines in 2003 and repeated in the Bangalore principles and implementation measures published by the UN-sponsored Judicial Integrity Group in 2010. Then there is the draft Universal Declaration on the Independence of Justice by the UN, also known as the Singhvi declaration, and the Universal Charter of the Judge, approved by the International Association of Judges on 17 November 1999. I could go on: there were also the Council of Europe recommendations, the Consultative Council of European Judges’ opinion and the Burgh House principles. There are clearly numerous guidelines about maintaining the independence of the judiciary by not varying their terms and conditions of service after appointment.
The present judiciary had a legitimate expectation when accepting offers of appointment that their pension arrangements would not be adversely changed after appointment. It would be wrong and damaging to our international reputation for this country not to respect that principle.
Finally, I pray in aid the report of the noble Lord, Lord Hutton, which was published earlier this week. He states at page 146, paragraph 6.92:
“The protections might also cover the extent to which there might be limitations on adjustments to existing judicial pensions to meet international conventions for protecting judicial remuneration, while also having regard to factors such as increases in the value of pensions from increasing longevity”.
In summary, Clause 24 will affect a modest number of people seriously and adversely and contravenes our international agreements on judicial pensions. We are not saying that people who are appointed in future could not make further contributions, but they would be appointed knowing that that was the case. I strongly support the amendment in the name of the noble and learned Lord, Lord Mackay of Clashfern.
Baroness Butler-Sloss
My Lords, I have wondered whether to speak on this amendment. First, perhaps, I should apologise to the noble and learned Lord, Lord Mackay of Clashfern, and to the Committee for arriving late. I had not appreciated that Amendment 55 was up on the monitor, but I came in as soon as I could.
I must declare an interest, not only as a former senior judge but also as someone whose father was a High Court judge, so I have spent my entire legal life in the shadow of the judiciary. I strongly support not only the noble and learned Lord, Lord Mackay of Clashfern, but particularly the noble Baroness, Lady Murphy, who made points that are really worth taking into account. It is not so much the senior judiciary—there are probably not more than 110 to 120 of them—as the middle-ranking judiciary who ought to be considered. They labour in the fields, with not particularly generous salaries, as the noble Baroness, Lady Murphy, said. I would add to her Queen’s Bench masters the judges of the various tribunals, who are crucial to the administration of justice in the tribunals; the district judges in the magistrates’ courts; and the district judges across the country trying civil and family work. They are a very important part of the judiciary. Many of them accepted a reduction of income. It is not only the top incomes that senior QCs can make that are reduced, as the people taking these middle-ranking posts also earn reasonable incomes. Almost every person who becomes a judge takes a cut in income.
People generally become judges because they feel that they ought to be paying back to society what they have gained by being barristers and solicitors. It is an important part of the judiciary that they are there to serve the public. They are a special group of people in the country. They are significantly independent and they have to remain independent to be able to challenge the Government in the courts. The Administrative Court is a thorn in the flesh of every Government, of whichever political persuasion. I believe that there is a book called “Looking Over Your Shoulder at the Administrative Court”, which trains new civil servants to cope with the slings and arrows of not so much outrageous fortune as the decisions of the Administrative Court.
I think that the public and perhaps noble Lords ought to remember that our judiciary is not only significantly independent but significantly incorruptible. Since I have left being a judge, I have been on parliamentary visits to various countries. In one of the eastern European countries that had been under the control of communism, I was told by one of the Ministers that the corruption of their judges was the most worrying part about their efforts to improve their country to meet the requirements of the European Community. My husband was a judge in Kenya at one time, under the ODA system, and I was told by my friends who were in the law in Kenya about the judges whom they knew to be corrupt. Eighteen were sacked at one time and my particular friend said that that was not all who should have been sacked. Very recently I was at one of the IPU meetings here in this building. I was talking about human rights and two Kenyan lawyers got up and said, “What do we do about the corruption of our judiciary?”. Forgive me for saying this as a former judge—since I no longer sit, I think that I can say it safely—but we are lucky in our judiciary. What the Government are proposing is in effect to break the contracts of the existing judiciary by substituting something else by statute.
I am well aware that everyone in the pensions system is going to suffer and I well understand people asking why the judiciary should be immune from the suffering of the public. So far as the future is concerned, as the noble and learned Lord, Lord Mackay of Clashfern, said, I express no view. It may well be entirely appropriate that the judiciary of the future should be asked to make the contributions that it has not been asked to make in the past; if I may say so, the Government ought just to think of the points that the noble Baroness, Lady Murphy, has made about that. However, breaking the existing contracts of existing judges who have given up their practices as barristers and solicitors to serve the community under a certain arrangement, where you take on that job without making a contribution, is something that the Government ought to think about long and hard. I very much support the amendment.
Lord Scott of Foscote
My Lords, I express my complete agreement with what has been said to your Lordships by the noble and learned Lord, Lord Mackay of Clashfern, the noble and learned Baroness, Lady Butler-Sloss, and the noble Baroness, Lady Murphy. I want to add a brief word on the nature of the judiciary in this country, which your Lordships will have to take into account in considering this amendment. I declare my own interest: I have been in the law for the whole of my working life, 23 years as a barrister and then 26 as a judge.
The judiciary in this country, and in many Commonwealth countries that have followed our system, is unusual in that it is not a profession that people decide to enter when they are at law school or when they leave law school. A number of continental countries have judiciaries of that sort: you decide that you want to go into the judiciary; you make an application; you become a member of some tribunal, whatever the country may be; if you are good, you work your way up the ladder; and then eventually you become a judge in a senior court. We do not do that.
The bulk of the judiciary in this country—perhaps all of them, barring a few who come from legal academia—come from the ranks of practising lawyers. As practising lawyers, they have a structure in their careers. If they stay in their firms, they can build up provision for their families and of course for themselves when they retire, and they can hope to leave something to their children. They can hope for affluence as the result of a successful professional career. In the old days, there would come a point in that professional career when the individual would get a tap on the shoulder and someone would say, “Now, would you consider becoming a judge?”. Now they have to apply, but I do not believe that that makes a significant difference to the type of people who become judges or to the stage of their career when that happens.
As has been said, an element of belief in public service influences the choice. If lawyers stay in their professions, they will have the expectation and hope—sometimes realised, sometimes not—of reaching comfortable affluence for their old age. When they enter the judiciary, it is and always has been a significant feature of the terms on which they enter that they will look towards a pension for themselves, and for their widow if they leave one, after service of an appropriate number of years on the Bench.
If there is a movement of the sort indicated by Clause 24 of the Bill, which establishes the ability of the Executive to alter to an individual’s disadvantage the terms under which they joined the judiciary—the terms on which they supposed that they would be able to rely for the purpose of building up whatever was necessary for a reasonably affluent old age and retirement—there is a danger that that may affect the type of judiciary that we have. It may affect the willingness of people to accept the degree of adoption of service as opposed to self-aggrandisement that is a feature of almost everybody’s decision to apply for—or previously to accept—a position on the Bench.
The noble and learned Lord, Lord Mackay of Clashfern, made the point strongly that for statute to interfere with the contractual terms of appointment is a very strong thing that must be carefully justified. In addition, I respectfully suggest that it is likely in the long run to change the nature of the judiciary in this country, to the disadvantage of us all. I support the amendment on that ground in particular.
Lord Falconer of Thoroton
My Lords, the amendment is in my name also. It is intended to prevent a fundamental break with the constitutional principle that we have adopted to protect the independence of the judiciary. We are talking about 800 or 900 people in all. The idea that the proposal would have a significant impact on the economy of the country is overstated.
The principle was clearly put by the noble and learned Lord, Lord Mackay of Clashfern, in the Second Reading debate on the Bill. He said:
“The principle that a serving judge shall not have his terms of service adversely affected without his consent during his term of service is a fundamental principle, part of the rule of law and internationally recognised. It has been followed by Governments in this country, so far as I know, as far back as I can tell”.—[Official Report, 15/2/11; col. 634.]
I agree with that; it is a brilliant statement of the position in relation to the terms and conditions of judges.
The amendment would give effect to principles agreed internationally—including by the United Kingdom—on the independence of judges, best expressed recently in the Bangalore principles, to which the United Kingdom is a signatory. The principles state:
“A judge shall not only be free from inappropriate connections with, and influence by, the executive and legislative branches of government, but must also appear to a reasonable observer to be free therefrom”.
It is important to emphasise what the consequence of Clause 24 will be. It will allow the Executive, first, to introduce contributions by a serving judge in respect of his or her pension. That is something that the Executive cannot currently do. Secondly, it allows the Executive in future, without the consent of the relevant judge, to increase the amount of those contributions without reference to any index or to any precedent contractual terms.
I invite noble Lords to consider the Bangalore principles again. Do the proposals give the Executive an inappropriate influence, or the appearance thereof, on what judges do? I say without a shadow of doubt that if, as Lord Chancellor, I had been asked to advise another country on these terms, I would have regarded them as an obvious breach of the principle enunciated by the noble and learned Lord, Lord Mackay of Clashfern, and in the Bangalore principles that the United Kingdom helped to draft, adheres to and promotes throughout the world.
If we are serious about the rule of law, we must preserve the independence of the judiciary. The noble and learned Lord, Lord Mackay of Clashfern, is right to say that if the provision goes forward in this form, it would be the first time—in my experience—we had broken our constitutional principle of not giving the Executive the power, by waving a wand, to say, for example, “We will reduce the judiciary’s terms”. We incorporated in the Senior Courts Act 1981 a provision that prevents the Executive from reducing judges’ pay to reflect in principle the substance of the memorandum that the noble Baroness, Lady Murphy, read out. That is why the noble and learned Lord, Lord Mackay of Clashfern, indicated at Second Reading that the pension changes that he introduced in 1993 could apply only to new judges. There is nothing to prevent the state from extracting significantly reduced terms from new judges, if that is what it wants to do, to show that we are all in this together. However, the one thing that I respectfully ask the Executive not to do is to introduce a power that means that they can hold the sword of Damocles over the judges and reduce their terms and conditions with a click of the fingers if the judges—as a group or individually—do something that they do not like. It would be a significant breach of the constitutional principle to which we have adhered for as long as I can remember and which records show to be the case. Therefore, I respectfully ask the Executive to think very carefully about the damage that they would do to our constitution with this rather mild-looking provision. I support the noble and learned Lord, Lord Mackay of Clashfern, and the noble Baroness, Lady Murphy.
Lord Stoneham of Droxford
My Lords, as a new Member of the House I am somewhat in awe of speaking against a very formidable lawyers’ lobby, although I am married to a solicitor. However, I am delighted to be the only person—it seems—to come to the assistance of my long-standing noble friend Lord McNally. I am reluctant to suggest that the esteemed noble and learned Lord, Lord Mackay, is the shop steward of judges, but I am less reluctant to hold back in respect of the noble and learned Lord, Lord Falconer, who has form in this respect.
Despite the assurances of the noble and learned Lord, Lord Mackay, that judges are not outside the tax system, noble Lords on this side of the Committee will remember the noble and learned Lord, Lord Falconer, defending judges being a special case in not having the tax-free limit imposed on their pension funds. The judges’ pension scheme is very generous. The formula is 20 out of 40 contributions: a judge on £170,000 will get a pension of £85,000 after 20 years’ contributions. This is on top of the provision that they will have made earlier in their careers. Most critically, the value of the contribution paid by the state is 32.6 per cent.
At Second Reading, two arguments were used against changing this very generous benefit. The first argument, put by the noble and learned Lord, Lord Mackay, was that we will undermine the excellence of our judicial system. I am sure that nobody wants that. The second argument, which has been emphasised today, is that we will break the spirit of the legislation that says that any salary payable to judges may be increased but never reduced. I would like to deal with both these arguments.
Nobody in this House would want to undermine the excellence of our judiciary. However, by accepting that the change can be applied to new judges, the amendment would abandon that concern as it would defend only sitting judges. The fact is that everyone in the outside world is having their pension schemes adjusted as defined benefit schemes prove too expensive, too beneficial and simply not sustainable. It is not easy for anyone. I accept the argument that judges cannot go back, but many people who face the prospect of losing their defined benefit scheme if they move jobs cannot go back either. There is a strong argument there.
Barristers 20 years ago were dependent on Equitable Life for their pensions, and the current judges’ scheme must seem more attractive to aspiring judges. The man on the Clapham omnibus will find it perverse if judges are not required to make some adjustment to the cost of their increasingly generous relative pension scheme, provided that everyone else in the public sector is doing so and they are doing it because they want to retain their defined benefit scheme. We know how defined benefit schemes have ended, and not only for new entrants in the private sector; many in existing schemes have lost them in mid-career. This was really the whole point of the Hutton report.
Lord Falconer of Thoroton
I apologise for rising again, but I should have made a declaration of interest; I made it at Second Reading but I should make it here, too. I was Lord Chancellor—I do not know whether anyone noticed—and therefore am covered by the judicial pension arrangements. However, none of this would affect me. Secondly and separately, I have close relatives who in future might be affected by this. I apologise profusely to the Committee for not making that declaration before. I also apologise if I have to leave before the end of the Front-Bench speeches. I hope that I will be able to hear them but I am also supposed to be in the main Chamber for the Fixed-term Parliaments Bill.
Lord McAvoy
My Lords, I rise as a former Unite shop steward to come to the rescue of my trade union colleagues among the legal fraternity. I am impressed by the campaign launched by my fraternal trade union colleagues. The noble and learned Lord, Lord Mackay of Clashfern, would have made a wonderful shop steward in Unite.
I started off by listening to the point, the sums and the principle. I am sure that it was not organised, but the turnout of legal colleagues had perhaps a whiff of vested interests about it—legitimate vested interests, but vested interests nevertheless. The more that I listened and thought about it, though, the more I thought that there is a trade union principle involved in this that has led me to support the amendment. That principle is that when you come to an agreement with your employer, it should not be changed in this manner. I hope that my saying this does not result in any more furniture being damaged but there is a principle here, a wonderful trade union principle, and I am delighted to be able to support my comrades.
Lord McKenzie of Luton
My Lords, I was going to be simply in listening mode on this, awaiting the wisdom of the Minister, with a few questions that may or may not be helpful but with a few comments as well.
I shall start with a point that I raised with my noble and learned friend Lord Falconer just before our proceedings about the precise wording of the amendment. We would not be happy with anything that linked any change to the CPI. We are having a broader debate about that switch and there is an issue, were there to be progress on putting in place a structure like this, about whether that should be linked to some sort of price base or to factors relating to longevity. That is a point of detail.
What we have in the Bill is a framework opportunity. The Minister can tell us about what specifically is currently proposed in respect of that. Can he say anything about the process of making regulations? The Bill just says:
“The appropriate Minister may, by regulations made with the concurrence of the Treasury, make provision”.
Is it envisaged that there would be some parliamentary process attached to that? Yes; he is nodding. I would hope that there would be, but how would that proceed? The point about any changes to the pension arrangements possibly being a slippery slope to undermining the judiciary is one that we need to be mindful of. I accept that, although we do not need to see it as the overriding point. If changes were to be a sort of Trojan horse, though, we would all deplore that.
I was going to raise the issue that the noble Lord, Lord Stoneham, raised—he made the point very effectively—about what counts as a diminution in the terms of service of a member of the judiciary in circumstances where the benefit of the pension, because of longevity, is actually increasing. There is a point there that needs to be answered. I can see that that itself creates difficulties. If you have a judge who has served for 20 years, longevity projections 20 years ago would have been quite different from what they are now; if you have someone who is new in post, that is potentially a different issue. That is a reasonable point. If you are looking at a reduction in someone’s terms of service, if you have a component that is improving in terms of the value of the pension, could you, at least in theory, net them off?
The movers of the amendment seem to have accepted the principle of some change to the pension arrangements because it would relate to new appointments. I wonder whether there are issues about what it would mean for a profession where you basically have two different sets of terms and conditions. Is that a particularly healthy position to end up in?
I wonder whether in all of this there is some sort of process of discussion to try to reach agreement on the way forward which current members of the judiciary would feel comfortable with; or will it always be the position whereby current judges will simply put up the shutters and say, “We don’t have to do this because we have a contract that says you can’t do it”—if that is what the contract says? As has been said, across the public sector people are taking pay cuts and facing large-scale redundancies and increases in contributions to their pensions, and it seems difficult for the judiciary, notwithstanding the constitutional arguments, potentially to be seen as standing aside from that. We should be eternally thankful for our judiciary in this country; they have a quality and integrity, and the public generally support them. However, is there not a risk that if you hold out on this, the trust and standing of judges might be undermined?
I have another point on which I should caution noble and learned Lords, although I hesitate to do so. I accept entirely the argument that judges have given up high-flying careers and high earnings because they want to put something back. That is a motivating force. However, you could say that equally of many others in the public sector. In our schools, how many first-rate, first-class teachers have given up or never pursued high-flying careers in the City because they had a passion, wanted to teach and put something back? I am sure that that is true in respect of the judiciary, but I caution against advancing that as part of the noble and learned Lord’s argument.
Does the Minister accept that the amendment would break the contract arrangements for existing judges, because that is the bone of contention here? Is that not the slippery slope towards undermining the independence of the judiciary? If he does not accept that analysis, it would helpful if he explained, from the Government’s point of view, why he does not. If we are in an environment where it is accepted, because we are all in this together, that there should be provision for new judges to make a contribution, it would be entirely reasonable for those provisions to be constrained in terms of how they might be used so that the floodgates are not opened with a fear that the measures could be used arbitrarily. I am sure that all sorts of legal remedies could be advanced, should the Government seek to do that. However, some sort of constraint would not be unreasonable.
Is there not, in all of this, some process for trying to achieve agreement with existing judges to participate and come into the fold on some basis, rather than have this stand-off and all the negative connotations that that entails? I should be interested to hear the Minister’s responses.
The Minister of State, Ministry of Justice (Lord McNally)
My Lords, as always, this has been an interesting debate. It is always difficult to respond to the noble and learned Lord, Lord Mackay, because his wonderful accent means that if he read from the telephone book it would sound like he was reading tablets of stone. Nevertheless, I may have to challenge him before the end of my remarks. The noble Baroness, Lady Murphy, was almost unique in her contribution, until the 7th cavalry arrived in the shape of the noble Lord, Lord Stoneham, but she at least is a friend of judges. She was quick on the attack by calling the government plans a “short-term crowd pleaser”, and saying that the Executive were looking for short-term advantages and imposing a real-terms pay cut of 10 per cent.
Running through many of the contributions has been an “Apocalypse Now” threat that does not stand up against the content of the proposal. I listened to what the noble Baroness said about women and about black and other ethnic minorities in the judiciary. I am the diversity Minister at the MoJ. Having looked at the problem of diversity in the judiciary, I honestly do not think that a modest request for contribution to pensions is the real problem about the disgraceful level of employment of women and other groups in the judiciary. I assure her that I am in close touch with Dame Hazel Genn and the noble Baronesses, Lady Neuberger and Lady Prashar, on those issues.
We went right back to 1701 to find the threat to our judiciary. The noble and learned Baroness, Lady Butler-Sloss, is not only a judge but the daughter of a judge. She made a moving appeal for the middle ranking judiciary—the toilers in the field, as she put it. Nobody challenges the fact that we have a judiciary motivated by public service, independent and incorruptible. I believe, and the past 10 months have deepened my conviction, that we are extremely lucky in our judiciary. Again, the arguments deployed do not bear close examination against the Government’s modest proposals. I also have to disagree with the noble and learned Lord, Lord Scott. I do not think that the proposal will affect those applying for the Bench.
I understand why the noble and learned Lord, Lord Falconer, is not here. We are not arguing that the contributions will have a significant impact on the economy. Of course not; the numbers are not large enough. I will not even try to suggest that we are all in this together, but I take up the point made by the noble Lord, Lord McKenzie: before fighting this to the last ditch, the judiciary should look at their reputation in appearing to fight so hard on a matter of self-interest—even if dressed up in constitutional garb—when others much less well equipped to do so, as the noble Lord, Lord Stoneham, said, are having to face serious sacrifice.
I take up the challenge of the noble and learned Lord, Lord Falconer: is what we are proposing reasonable? I believe that the vast majority of people in this country would find what we are doing reasonable. To suggest that the Government are somehow threatening the independence of the judiciary or the rule of law is not sensible. There is no sword of Damocles or anything like it. I urge the judiciary not to cry wolf too loud on this.
I turn to the noble Lord, Lord McAvoy. My goodness, I am sorry that we are in the Moses Room, because his intervention deserved a much wider audience. I thought that he was going to say that even his old colleagues in the Unite shop stewards’ movement would have blushed at some of the arguments deployed today, but as he rises ever higher in the hierarchy of this House by defending its institutions, it did not surprise me when he intervened on the side of the judges.
I am grateful to the noble Lord, Lord Stoneham, for his intervention. Judges’ pensions are extremely generous: 648 former judicial officeholders receive a pension of between £40,000 and £70,000; 23 former judicial officeholders receive a pension of between £100,000 and £110,000. The average annual pension across the judiciary is just over £41,000. That is not at the lower end of the mass of our society.
That is why the noble Lord, Lord McKenzie, was quite right to warn about reputational risk. I do not believe that this is a slippery slope. I do not believe that it is a reputational risk. On the specific point of how we would handle the powers of the Bill, regulations would be brought forward by statutory instrument subject to negative resolution.
The noble Lord asked me: what is our response to the amendment? I have to tell your Lordships that we believe that it is simply incorrect to assert that the clause could have any impact on judicial independence or raise any concerns about judges’ terms of service. This measure is part of a wider action aimed at ensuring that public service pension provision remains fair and affordable. The Government will not do anything to undermine judicial independence and the rule of law, which is of fundamental constitutional importance. The measures will not affect the pension entitlement of judicial members in any way. Once a member of a judicial pension scheme satisfies the provisions regarding entitlement under the particular scheme, they will still be entitled to their pension benefits, which will not be affected by the contributions they have made. The aim of the measure is that the contributions, when payable, will go towards the cost of the scheme overall—a situation which, as the noble Lord, Lord Stoneham, pointed out, is not enjoyed by many people in many other pension schemes.
The principle that serving judges must pay contributions out of their salary towards the cost of pension provision is already well established. I am pleased to note that the amendment does not object to the principle of taking personal contributions from judges. To take the Judicial Pensions and Retirement Act 1993, which provides the main scheme referred to by the noble and learned Lord, Lord Mackay, members of that scheme pay contributions towards the cost of dependant benefits. That is provided for by Section 9. When the provision was implemented under the Judicial Pensions (Contributions) Regulations 1995, it applied to all those who held qualifying judicial office under the scheme at that time. There were no exceptions for serving judicial officeholders.
The inability of the Government to reduce judges’ pay is seen as an important element of judicial independence by a number of international agreements and recommendations, which have been referred to in the debate by several speakers—the fear being that in some parts of the world, judicial salaries may be reduced if justices do not make the right rulings. I am sure that none of us would seriously suggest that we are in danger of that in this country.
However, that aside, as a matter of ordinary language it would not be usual for a requirement to pay a contribution to a pension scheme to be characterised as a reduction of salary; gross levels of payment to judges will remain unaffected by this measure. Crucially, it would not be correct to assert that the Executive will establish and vary the level of personal judicial pension contributions because the rate at which such contributions will be taken will be set by secondary legislation and so will be subject to the scrutiny and will of Parliament.
Furthermore, this measure does not contravene the letter or the spirit of statutory provisions covering judicial salary protection. Just as it would be incorrect to assert that this measure could impact on judicial independence, so it would be wrong to state that it is inconsistent with the terms of appointment of judicial officeholders. The entitlement to, and benefits derived from, a judicial pension are set out in legislation. Judges’ terms of appointment do not add to, or repeal, the provisions of judicial pensions legislation and do not, therefore, provide any independent source of “right” to the maintenance of the present legislative arrangements in respect of those already appointed to qualifying judicial office.
Any expectation that Parliament may not legislate to alter judicial pension schemes enshrined in legislation cannot be right, particularly when the proposed measures are designed to ensure that such schemes remain affordable and are proposed as part of a consistent range of measures regarding public service pension schemes as a whole. Concerns about judicial independence and judges’ terms of service with regard to this measure are, therefore, unfounded.
It is important to be clear that this measure will apply to judicial officeholders in post in April 2012. However, I should also emphasise a point made by my noble friend Lord Freud during the Second Reading of this Bill; that is, that contributions will only be taken during the period in which an individual judge is accruing pension benefits. For those judges already entitled to a full pension before implementation in April 2012, contributions will not be taken from their salary. Those judges who have part completed their full accrual period before April 2012 will pay contributions only for the outstanding balance of that period. The value of the pension benefits accrued up to the point of introduction of the measure will be unaffected.
At the spending review, the coalition Government took the tough decision to put the economy back on a sustainable footing. To do this they had to consider carefully where spending could be reduced and where costs could be rebalanced to reduce the burden to taxpayers. The noble Baroness, Lady Murphy, called in aid the noble Lord, Lord Hutton, and so do I, for he states clearly that there is a strong case in the short term for increasing the contributions to meet the costs of providing these pensions. This is what we are doing. It is right that judges should begin to contribute towards their own pensions just as other public service pension scheme members will be expected to contribute more.
There are currently around 2,200 salaried judges. Of these, around 200 are estimated to have already accrued a full pension and so would not make personal pension contributions. Therefore, the requirement to pay personal pension contributions will apply to approximately 2,000 salaried judges when it is introduced.
On average, in recent years, around 120 salaried judges have joined the judiciary each year. To restrict the introduction of personal contributions only to new judges appointed from April 2012 would, therefore, either not allow us to make the level of short-term savings on judicial pensions costs which we need to seek in tackling the deficit, or would require an extremely high level of contribution by new judges to help cover the costs of existing judges’ pensions. There is, anyway, as I hope I have made clear, no justification for restricting the measure in this way.
As I said, I will not try to persuade noble Lords that we are all in this together but it would be widely misunderstood if judges seemed to opt themselves out of the realities faced by the rest of the population.
Baroness Murphy
Before the Minister sits down, will he clarify the point about the judicial additional voluntary contributions scheme? I believe that at the moment individuals can exercise their right to add up to 15 per cent. What impact would this new proposal have on the ability of individuals who have a relatively short time to make their contributions before retirement to add to that scheme?
Lord McNally
I apologise if I am wrong on this, and I will write to the noble Baroness, but I believe that the 15 per cent right will be retained and judges will be able to make voluntary contributions, as they do now. I should have asked the noble and learned Lord to withdraw his amendment, even if he intends to return to the fray on Report.
Lord Mackay of Clashfern
My Lords, I need not make a premature decision on that. I will certainly withdraw the amendment, but I will say one or two things about the speeches that we heard. I am grateful to all noble Lords who contributed. It was good to have the support of the noble Lord, Lord McAvoy, who shares something of my accent, though possibly not everything.
My only point at Second Reading concerned the terms of service. The noble Lord, Lord Stoneham, must have been thinking of somebody else when he said that at Second Reading I referred to the quality of the judiciary. I do not think that I did. At Second Reading, I made the point that when I introduced the 1992 Bill that became the 1993 Act, I faced a terrific barrage concerning the effect this would have on the judiciary of the future. Fortunately, Parliament as a whole decided that the gloomy forecast was not correct. I think that I am right in saying that nobody, looking back, would say now that it was correct. The quality of the judiciary has remained very high. However, I did not make the point about the quality of the judiciary: other noble Lords did. I restricted myself to saying that, in accordance with our understanding of the constitution, the terms of service of a serving judge cannot be altered adversely during his term of service.
The noble Lord, Lord Stoneham, referred to contracts being changed with changing circumstances. Of course, most employees are in a situation where their contract has a definite time. The contract will run for that time and, unless there is agreement, it will be very difficult to change it. Judges' terms of service are until retirement because of the security of tenure that the Act of Settlement gave them. There is no question in my mind that we have thought for many years now that the terms of service of judges needed to be set out in statute. In 1993, we set out new terms that applied only to new judges: that is to say, judges appointed after the Act came into effect.
The noble Lord, Lord McNally, said that the 1995 regulations applied to everybody without exception. With the greatest respect, that is not correct. The 1995 regulations applied only to the arrangements under the 1995 Act, which applied only to those appointed after the Act came into effect. The main regulations came into effect on the same day as the Act. Therefore, the regulations were in place when the Act came into effect. Judges who were serving before 31 March of whatever year it was—I think it was 1995—were not subject to the arrangements. They had the opportunity of opting in to the 1993 Act arrangements, but were not obliged to do so, and a number of serving judges still have a retirement age that is different from that laid down in the 1993 Act.
The noble and learned Lord, Lord Falconer, said that he had an interest in this matter which he should declare. I made it absolutely clear—I thought that I had done so originally, but perhaps I did not do so today—that I was the Lord Chancellor for a while, including at the time the 1993 Act came into force, as well as when it was being brought through Parliament. I was also a judge in the Supreme Court in Scotland and a Lord of Appeal in Ordinary. But so far as I know, I have no financial interest in this whatever, and I am certainly not a spokesman for the judiciary—not at all. The judiciary must speak for themselves, though they cannot speak for themselves in this House any longer as serving judges are not allowed to speak here. Therefore, they will have to speak to the Minister for themselves, and I have no doubt that they will have an opportunity to do that. I am not privy to the sort of consultations they may have, although I have heard a little about it. I will have to leave being a spokesman for the judiciary to others; it is certainly nothing to do with me.
I appreciate the difficulty we are in in the present situation. I can see that everyone is required to make sacrifices. Of course, that is something that one can do under the tax regime. I am not confident enough to suggest how this could be done, but I feel certain that the tax regime is pretty flexible in getting money out of people. So there is no question that tax could be used; it does not infringe the terms of service of the individual. When there was a general reduction in the salary of public servants in the Republic of Ireland, the judiciary was expressly excluded for the reason that the constitution had that arrangement in it. I agree that longevity is an important part of the value of a pension but the terms of service here are perfectly clear, as set out in the 1993 Act. My point is that this is a breach of the general understanding of our constitutional arrangement that a judge’s terms of service should not be altered adversely during his period of service. Of course, I shall withdraw the amendment. Whether I return to it may depend on a variety of circumstances which I am not in a position to control at the moment.
Lord Boswell of Aynho
“Gender recognition
Notwithstanding the other provisions of this Act, those persons living within their acquired gender within the terms of the Gender Recognition Act 2004 for a period of two years before the passage of that Act, or who have received a full gender recognition certificate under the terms of that Act within a period of two years after its coming into effect, are deemed always to have lived in their acquired gender for the purposes of calculation of state pension and other provisions of this Act, provided that this is not to their detriment in entitlement to those benefits and other provisions.”
Lord Boswell of Aynho
I am conscious of the hour and will try to be as succinct as I can. The Committee will know that I served previously for 23 years as the Member of Parliament for Daventry, and would not wish me to rehearse too many experiences from that time. However, I would say that this is one of the perhaps two handfuls of cases that I encountered as a constituency Member which struck me as having a particular interest or relevance, which influenced my subsequent actions and interests and in which I became personally involved. It is for that reason that I have brought forward this amendment.
I refer to the situation of a then constituent who was well known to me, who is now a senior and respected member of her local community, having transgendered from being a male and having in that capacity been a senior civil servant—and therefore well able to write a brief for me on this subject, though she is not the sort to do so in this case. I know that the Minister is aware of her identity, as is my successor as the Member of Parliament for Daventry, with whom I have discussed this case and who was enthusiastic that I should take it forward. We happened to discuss it by chance, and I said, “Ah, the Pensions Bill is on; a new clause will be following immediately, because we ought to chase this”.
The background to this situation, which involves the comparatively small number of people in this country who are transgendered, perhaps 5,000 or something of that order, was an adverse judgment of the European Court of Human Rights against the UK for not really handling the problem. It is a matter, both in the application of the judgment and more generally, that continues to attract its attention. Purely by coincidence, I happened to notice as the result of some representations that I had this week by e-mail, that the ECHR is going heavy on Lithuania, which has a rather more punitive attitude than the United Kingdom has ever typically shown on the matter. The issue is not about punitive intervention; rather, it is essentially about the lack of a legal regime and, to some extent, a lack of interest in handling our problem.
The previous Administration rightly sought to respond to the ECHR judgment by introducing a Gender Recognition Bill. Because of my involvement with those issues, I volunteered to lead for my own party in the Standing Committee and the detailed consideration of that Bill. I found the situation fascinating and complex, although there was a wide measure of consensus across the committee. These are complex and sensitive issues for the people involved. People often get the wrong end of the stick if they have had no interest or involvement in this area; they get confused by issues of surgery and so forth. Those matters were rehearsed at some length and in some depth in the committee.
The criterion under which we were operating was living in the acquired gender as the main test, rather than some purely mechanical procedure, and proof that that had been taking place for a substantial period of time and had not been reversed and was not equivocal. Under the 2004 Act, that led the individual involved to have the right to apply for an interim, and then for a final, gender recognition certificate.
I should make the point that this is substantially a matter of law, and it would have been nice if the Ministry of Justice, in the shape of my noble friend Lord McNally, had stayed behind. I am sure that my noble friend Lord Freud will want to have consultations with the Ministry of Justice—indeed, I hope that in formulating his response to this he has done so—because it is primarily an issue of law and legal status.
There were some difficulties, and therefore there is only a limited amount of retrospectivity. If I may give an example from outside this context in relation to registrations of birth, there was an understandable reluctance to tear up the birth registration if someone had altered gender, and special provisions were made for the registrar to record separately any subsequent applications and the grant of gender recognition certificates. We cannot unwrite the past or the previous gender—perhaps some of the people involved would not wish to do so—but we record as we move on.
As I said to the committee, there was a strong emphasis on law and a tacit understanding that, once the certificate had been given, that would alter the legal status, but it did not convey benefits retrospectively back to the cradle in the new acquired gender. It would be fair to say, with no disrespect to either Ministers or officials from the Department for Work and Pensions in their briefing on the Bill, that the provisions for pensions and state benefits were grafted on. It would also be fair to say that Members of the committee like myself did not focus as intensely on them as we did on some of the other issues that we had already debated.
Baroness Drake
My Lords, I am very sympathetic to the amendment, which draws attention to the need to bring a practical resolution for those individuals who have not been able to benefit fully from the Gender Recognition Act 2004. I compliment the noble Lord, Lord Boswell, on raising the matter, because the issues facing transgendered people are considered too infrequently. They will appreciate the fact that their concerns are being recognised in the amendment and in the debate.
As noble Lords said, the welcome introduction of the gender recognition certificate in 2005 meant that individuals for the first time could have their acquired gender formally recognised. However, as with all changes of this type, some individuals are caught in the transition process and risk losing out. As the noble Lord, Lord Boswell, indicated, there are no official data on the size of the transgender population, so it is difficult to quantify the number of individuals who would benefit from a resolution in the manner of the amendment. However, it is clear that the number of individuals is likely to be very small. Therefore, it is unlikely to make a substantial financial difference to government expenditure, although it will do for the individuals concerned.
The Gender Recognition Act 2004, which was introduced in 2005, brought in the official process to recognise gender change. For those who transitioned prior to 2005, there was no official recognition of their change in gender, although the DWP, to the extent that it could use its discretion, was often sympathetic in allowing the change to be recognised in some circumstances. Since the introduction of the gender recognition certificate, an individual with such a certificate is are treated as though that is their natal gender. The amendment seeks to ensure that those who transitioned prior to the implementation of the provisions, and those who did so immediately after the Act came into effect, are not disadvantaged.
The primary beneficiaries of the amendment would be male-to-female transgendered people who reached female state pension age before 2007. At present, they are unable to claim their state pension for that initial period. For example, a male-to-female transgendered person who turned 60 in 2005 but got a gender recognition certificate only in 2007 would not have received the state pension until they gained the certificate in 2007. Therefore, they feel that they lost two years of state pension provision given their acquisition of the female gender. Also, as we know, the women's state pension would have been based on a lower number of working years—39 years for women as against 44 for men. The amount that would have been accrued and credited, as well as the time at which it was paid out, would have been different.
The noble Lord recognises in his amendment that there could be losers. Female-to-male transgendered persons would face the reverse issue to the one that I described for male-to-female transgendered people. The aim of the amendment is to ensure that there are no losers. It seeks to implement the provisions to the detriment of no one. I do not know whether the Minister will pick up on that point. It is a not unreasonable position because those most affected, who will be small in number, would have been near to pension age and would have had less time to adjust to the implications of that.
There will be other issues, such as those relating to divorce. When one partner wishes to transition with a gender recognition certificate, the couple cannot legally remain married. They must divorce and become civil partners. That could create winners and losers. The noble Lord, Lord Boswell, is right to say that what he aspires to achieve in the amendment should not be done in a way that is detrimental to the entitlement of anyone affected. I commend the noble Lord for addressing the sense of unfairness to a small group of individuals, and I join him in urging the Minister to address it.
Lord Freud
My Lords, the amendment seeks to provide a remedy for a group of older transsexual people who have missed out on full state pension rights because the Gender Recognition Act does not allow for retrospective legal recognition of a person’s acquired gender. This is a very complicated area, as my noble friend Lord Boswell pointed out. He spared us some of the detail when he introduced the amendment, but I should take a little time to outline the issue and give him the up-to-date information on the current position.
A transsexual person is someone who desires to live their life permanently in the opposite sex to that which they were assigned at birth; although “assigned” might be the wrong word. This desire often stems from a medical condition called gender dysphoria. The Gender Recognition Act, effective from April 2005, allows transsexual people, through the granting of certificates, to gain recognition of their acquired gender for all legal purposes. It covers only people who have suffered from gender dysphoria.
It is a general principle of our legal system that the laws relating to legal status should have only prospective effect. This ensures legal certainty and clarity. There was no reason to depart from this principle when the Gender Recognition Act was introduced, as my noble friend will be fully aware. Although the Act established future rights, a question remained over the past.
The position on the equal treatment rights of transsexual people for periods before 2005 was tested in the domestic and European courts. In 2006, the European Court of Justice held that it was discriminatory not to have had a means of recognising a person’s acquired gender, for social security purposes, prior to the introduction of the Gender Recognition Act. However, importantly, the court left it up to the UK Government to set the conditions for granting equal treatment for periods prior to the introduction of the Gender Recognition Act in 2005. The European Court clearly considered that it provided adequate cover for periods after that date.
Perhaps I may give my noble friend more up-to-date figures than those he might have. Records held by HMRC suggest that around 750 people in the UK are likely to gain from the European Court ruling, compared with the figure of 50 that he imagined. Under that ruling, where a person is successful in their equal treatment claim, we would need to make increased state payments on the basis that they had foregone all entitlement from the age of 60 or the date of surgery, if that was later. The costs of making such payments would amount to somewhere between £9 million and £38 million over the lifetime of the award. One can recognise the level of uncertainty surrounding that wide spread.
Lord Boswell of Aynho
My Lords, I am grateful to the Minister for his response, the detail that he has been able to bring to the current situation, his explanation of some of the difficulties that go even further than those that I had anticipated or scoped, and his sensitivity in dealing with the matter. I do not think that anyone would have expected a knock-down, one-off answer today, but we have had some encouragement on the commitment to having a specialist team to deal with the issue of equal treatment. I give a personal commitment to provide any assistance that the Minister might want on this, because I am happy to continue my interest in this area in any way that would be useful to a resolution. None of us wants serial legislation to clear up each case. It would be better to get an agreed understanding, and the Minister has perhaps given us the basis for that. I am grateful to him and I beg leave to withdraw the amendment.
Lord Boswell of Aynho
“Objectives of the Pensions Regulator
(1) Section 5 of the Pensions Act 2004 (regulator’s objectives) is amended as follows.
(2) At the end of subsection (1), insert—
“(e) to promote the provision of good pensions and to ensure their health and longevity.””
Lord Boswell of Aynho
My Lords, I will be even briefer on this amendment, having regard to the hour and the common wish to finish.
This amendment arose as the result of an approach that I received from the National Association of Pension Funds. The intention of the new clause would be to put what I might call a forward gear into the work of the Pensions Regulator. As I have explained to the Committee in the past, I have quite a lot of people in my family with a background in education. My wife for one would always say, “Emphasise the positive, don’t go around looking at the negative”. That is a good maxim for this Committee.
At the moment, as the NAPF reasonably reminds us, the Pensions Regulator has three basic statutory objectives, all of which are, at least to some extent, slightly passive, although I do not mean that they are improper: first, to protect the benefits of members of work-based pension schemes, which is hugely important; secondly, to promote the good administration of work-based pension schemes, which is also important, although administration is something that serves rather than being the main driver of the event; and, thirdly, to reduce the risk of situations arising that might lead to claims for compensation from the Pension Protection Fund. At the moment there is an interest in preventing that getting out of hand; we have discussed the levy and the burden on pension funds and, indirectly, on contributors of all kinds. No one is arguing that those objectives are wrong, but the NAPF’s concern, which I warm to, is that the last obligation—trying to avoid benefit run-off—is beginning to dominate the regulator’s activities. The overall work of the regulator is insufficiently focused on the continuation of good-quality workplace pensions. It is in the interests of the NAPF and of everyone across the Committee that that should be sustained.
What is proposed here is a simple provision that would give us a positive forward gear to promote the provision of good pensions and to ensure their health and longevity. Nobody here would dissent from that. Arguably, large parts of the Bill, particularly in relation to the NEST scheme, are focused on it, and it would be helpful to have the Minister's response in due course. He will recognise a probing amendment when he sees one. I am not committed to the exact wording, nor to the vehicle involved: but I hope that somehow we will be able to signal that the focus should be on supporting, sustaining and maintaining the positive, rather than on simply cleaning up the mess where things go wrong.
I will take one final shot. Perhaps the Minister would report on any elements of deregulation or decluttering of the business obligation that he has undertaken within the spirit of BIS’s one-in, one-out approach. That would be helpful. I beg to move.
Lord McKenzie of Luton
My Lords, I will be brief. I understand the thrust of the amendment. However, I have some concerns, mainly over the wording. To place on the regulator an objective to ensure the health and longevity of good pensions is stretching a point. The regulator is focused on workplace pensions. As written, “pensions” could range over a raft of different situations, including contract-based ones as well as DB ones.
From my experience, I challenge the assertion that the regulator is overly focused on protecting the PPF. Perhaps it is easy to forget the circumstances of 2004, when DB schemes were dropping out of the system like flies. The regulator's role then made a real difference. I recall also that over the past 18 months to two years there have been constant challenges to the regulator on the grounds that requirements under recovery plans were too severe. The regulator responded in a very effective way, being clear about what flexibility there was in the system but also recognising that what was important to DB schemes was the employer covenant. Unlike insurance-based contractor arrangements, these entities are capitalised and support the provision of annuities or whatever else through that structure. For DB schemes, it is the undertaking of the employer and sponsor that is the driver. Therefore, the regulator's role in holding them to account is good.
No one would object to anyone’s role in promoting the provision of good pensions. However, in this case I would not impose the obligation to ensure their health and longevity, because these will depend on a whole raft of things, not least the commercial situation of the sponsor and what their future may be. The regulator has played an important role, and I will be interested to hear if the Minister has any proposals to change their current remit and focus.
Lord Freud
My Lords, we have reached the last amendment in Committee on the Pensions Bill with a little nostalgia—and perhaps with relief for some. I will deal with my noble friend Lord Boswell’s amendment on the objectives of the Pensions Regulator, and will start by providing some background. Many noble Lords will be aware that Parliament legislated, through the Pensions Act 2004, to establish an independent, risk-based Pensions Regulator whose job was to regulate work-based pension schemes based in the UK. The Act gave the Pensions Regulator his main statutory objectives. These include protecting the benefits of members of work-based pension schemes and limiting calls on the Pension Protection Fund. Noble Lords may be interested to know that, in its 2007 report on the Pensions Regulator’s progress in establishing a regulatory approach, the National Audit Office found that the objectives provided a sound framework for pensions regulation.
Some of us may also be aware that the NAPF, in its 2010 report Vision for Pensions, recommended that the regulator’s activities should be reoriented. They proposed that this should be done by giving the regulator a new objective, to promote good pension provision and to ensure their health and longevity. My noble friend is well aware of the interests of the NAPF in this area, given the nature of this amendment.
Lord Boswell of Aynho
I am grateful to my noble friend for the way in which he has answered this question. I have been around for a year or two and have seen a ministerial brief or two. I am not entirely surprised, although mildly disappointed, at the nature of his comments. We understand the difficulties, including the substantive one of confusing people or in any way removing the focus on the important background work of securing a properly funded and safe pensions industry. I am glad on his behalf that the Minister has assumed for himself the role of the forward gear, because he is the best possible bully pulpit for all this. The essence of this should be collaboration and discussion between representatives of the industry, employers, staff and the department to facilitate a good outcome.
In conclusion, this has been the first Committee that I have attended in this place. I am grateful to my noble friend for his responses, but in the same breath I apply that gratitude to noble Lords opposite, including the noble Lord, Lord McKenzie of Luton, and others. I have found this procedure enlightening and positive, and on the whole it has done some good. I am grateful specifically for my noble friend’s response, and beg leave to withdraw the amendment.
House of Lords
Northern Ireland: Bill of Rights
(13 years, 1 month ago)
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Lord Smith of Clifton
To ask Her Majesty’s Government what consideration they are giving to the motion passed by the British-Irish Parliamentary Assembly on 22 November 2010 which noted the delay in the introduction of a Bill of Rights for Northern Ireland, as promised in the Belfast agreement, and called upon Her Majesty’s Government to fulfil their obligation in that regard.
Lord Shutt of Greetland
My Lords, the Government remain committed to maintaining human rights protection in Northern Ireland and fulfilling our obligations under the Belfast agreement. Indeed, my right honourable friend the Minister of State recently met human rights organisations in Northern Ireland and stressed the difficulty of making progress without political consensus within Northern Ireland and the Northern Ireland Assembly. We will continue to consider how best to address this issue in the coming months.
Lord Smith of Clifton
My Lords, that is not a very satisfactory Answer because it gives a veto to the Stormont parties and it is not their prerogative to exercise that veto. Is what my noble friend said the agreed policy of the coalition? If it is, which Liberal Democrat Ministers participated and concurred in that agreement?
Lord Shutt of Greetland
My Lords, that is an interesting one. I am not the Minister; I am the Whip.
Lord Shutt of Greetland
I make it quite clear; I am the Whip and there are two Ministers in the House of Commons. Noble Lords will remember that we had the general election, following which the number of Members of Parliament in each party was rather different. Under the coalition agreement, the number of Liberal Democrat Members who became Ministers was rather smaller than the number of Conservative Members who became Ministers. My noble friend’s right honourable friend and mine, Nick Clegg, the Deputy Prime Minister, paid a three-day visit to Northern Ireland in October, and I also had a three-day visit. Even though I am not a Minister, I endeavour to influence events and I hope to have a degree of success in that. Alongside my noble friend as the Liberal Democrat Back-Bench co-chair for the policy committee on Northern Ireland, Mr Stephen Lloyd, MP for Eastbourne, has recently been appointed to serve as the House of Commons co-chair.
Baroness Royall of Blaisdon
My Lords, I remind the Minister, with respect, that he speaks on behalf of the Government as a whole. The Government have pledged to bring in a British Bill of Rights. I wonder what that means for Northern Ireland and whether the Government are going to pursue a Northern Ireland Bill of Rights and a separate Bill of Rights for the United Kingdom. I should be grateful for the views of the noble Lord the Minister.
Lord Shutt of Greetland
My Lords, I shall endeavour to speak for the Government. I was just giving the facts as to who is the Minister and who is the Whip. I hold the latter position, and I think noble Lords will find that that situation existed when we had a different Government. The noble Baroness may recall that the Belfast agreement came into being on 10 April 1998. It was agreed that there would be an Assembly with full legislative and executive authority for the six Northern Ireland government departments. Furthermore, it was agreed that the European Convention on Human Rights would be embraced in any Bill of Rights for Northern Ireland that supplemented it. Of course, it is 13 years since the Belfast agreement and things do not stay still. We got a Human Rights Act in December 1998. The devolved Assembly has these powers and from time to time legislative consent motions are required. On 16 February—
Lord Shutt of Greetland
If you want the answer you can have it—the Prime Minister announced that a group of people would be put together for a human rights Act for Britain. Therefore, the Belfast agreement has to embrace those other three factors.
Lord Kilclooney
My Lords, can the Minister confirm that the Belfast agreement brought benefits to the peoples of both states in the island of Ireland? Can he recall that there were obligations on the Dublin Government in that agreement to create a human rights commission, to ratify the Council of Europe’s convention on national minorities, and to legislate for employment equality and for respect of the different traditions in the island? Can he confirm whether any of those four requirements have been honoured yet by the Dublin Government? For those that have not been honoured, will he make representations to the new Government elected in the south of Ireland a few weeks ago?
Lord Shutt of Greetland
My Lords, as I indicated earlier, I will do my best to speak for this Government. It is someone else’s job to speak for the Government of Ireland. However, in another coalition agreement, between Fine Gael and Labour in the south, there is one line that the Belfast agreement and the St Andrews agreement “shall be honoured”. If that is in their coalition agreement, it applies to them as it does here, and I will see to it that I write accordingly.
Lord Glentoran
My Lords, I want to clarify a couple of things. While shadow Minister in opposition, my right honourable friend the Secretary of State, I and others in the team undertook that once the United Kingdom Government set up their own human rights Bill, Northern Ireland would have its share of it. That is where I still stand, and I suspect that my right honourable friend the Secretary of State is in a similar position.
Lord Shutt of Greetland
I am not absolutely clear about the question, but the Government are possessed of the fact of honouring the Belfast agreement. Within that there has to be a human rights element for Northern Ireland. What is not absolutely written in stone is that that has to be very separate.
Lord Bew
My Lords, will the Minister comment on the reality that the Belfast agreement does not impose an obligation on the Government to legislate on the human rights question; rather, it imposes an obligation on them to receive the report of the Northern Ireland Human Rights Commission? Rather more profoundly, that report is supposed to be based on the principle of “parity of esteem” for the “two traditions”. That is explicitly said in the Belfast agreement. The Northern Ireland Assembly has in effect rejected the idea that it is so based. Is it not at this stage for those who believe in human rights legislation to carry on the argument in Northern Ireland with the Northern Ireland Assembly to see whether minds can be changed?
Lord Shutt of Greetland
It certainly is. The Northern Ireland Assembly voted by 46 votes to 42 that it did not want separate human rights legislation. There is an election, and things might well change following that election. If a united front in the Northern Ireland Assembly said that that is what it wanted, obviously the British Government would take due notice.
House of Lords: Life Peerages
(13 years, 1 month ago)
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Lord Grocott
To ask Her Majesty’s Government whether they intend that the life Peers they have appointed should be Peers for life.
The Chancellor of the Duchy of Lancaster (Lord Strathclyde)
My Lords, the Government confirm that they have no plans to remove the peerage from those in receipt of that honour.
Lord Grocott
My Lords, that is a very, very welcome Answer. I am almost at a loss for words. I am so much at a loss that I want to have it rephrased. Is the noble Lord actually saying that everyone currently a life Peer will remain a Peer for life? If he is saying that, I suggest to him that he is getting himself out of an awful lot of difficulty, but if he is not saying that—he is looking very quizzical now, so perhaps I was not getting a straight answer to a straight question. Let me simply put it to him that it would be a bit cynical if the same Government who have created 119 new life Peers since the general election, all of whom are making a terrific contribution to the work of this House, are at the same time, according to his interview with the Financial Times at any rate, planning to remove us and replace us with senators by 2015. I suggest to him that given that, so far, there has been no agreement whatever on the powers and functions of any reformed second Chamber, the simple thing for him to do—I imagine it would be a relief to the Government—would be to pick up the splendid House of Lords Reform Bill in the name of the noble Lord, Lord Steel of Aikwood, and take it forward as government policy.
Lord Strathclyde
My Lords, I thought I had been entirely straight with the noble Lord. A peerage is for life. That honour should remain, but it should not necessarily guarantee a seat in the House of Lords. The noble Lord knows that well because he knows that the Government are committed to House of Lords reform, as all major parties agree that reform is needed and this coalition Government provide the opportunity to determine final proposals that can be put to Parliament after there has been a Joint Committee of both Houses.
Lord Cormack
My Lords, my Letters Patent give me the right to sit here for life. I assume my noble friend’s Letters Patent do the same. Are we to attach more importance to the Letters Patent from the Queen or to the views of the temporary Deputy Prime Minister?
Lord Strathclyde
My Lords, in the passage of the House of Lords Act 1999 we went through this quite a lot. In the end, the view was that statute law could vary the terms of the Writ of Summons. Therefore, if it was the will of Parliament that life Peers should not be guaranteed a place in the House of Lords, I do not think there would be any problem.
Lord Campbell-Savours
My Lords, if membership of the House is to reflect the crude statistic of the national vote at the most recent general election, when can we expect to have 21 UKIP Members of this House and 14 British National Party Members?
Lord Strathclyde
My Lords, we have no plans to introduce members of those parties at the moment. Of course, if there was an elected House, it would be up to the electorate to decide who should sit in this House.
The Earl of Onslow
My Lords, is there not something totally glorious and hypocritical about the noble Lord, Lord Grocott, saying please may his peerage be guaranteed but those promises to elected successors of mine, which could be in the fairly near future, should be taken away?
Lord Strathclyde
My Lords, it is good to see my noble friend speaking in this House, as he has done for many years, and long may that continue. Different people will take a different view of what the noble Lord, Lord Grocott, said but he has been entirely consistent since coming here in wishing to preserve the House more or less as it is. It is an important point of view, although not one with which the Government agree.
Lord Hunt of Kings Heath
My Lords, the noble Lord, Lord Strathclyde, too, has been entirely consistent in being a passionate exponent of an elected House. But yesterday he told the House that he expected that dozens, indeed hundreds, of new coalition Peers would be appointed over the next few years. Can I take that as indicating that he is therefore not very optimistic about the prospect of substantive reform?
Lord Strathclyde
My Lords, neither is the case. While there is an appointed House, it is always open to the Prime Minister to appoint new Members to it on a cross-party basis and the noble Lord will have seen the coalition agreement on that. However, if Parliament passes a Bill for an elected House, elections would take place.
Lord Tyler
My Lords, will my noble friend acknowledge that since 1997, when a Government, of whom the noble Lord, Lord Grocott, was a distinguished Member, were elected with a clear commitment to reform your Lordships’ House to include elected Members and, by implication, to end the life peerage, all of us who have been appointed know that we are term Peers in practical terms? Will he further acknowledge that the big difference since May of last year is that instead of just talking about this for 13 years we have a Government who are committed to action?
Lord Strathclyde
My Lords, my noble friend is quite right. I do not believe that any new Member of this House, before accepting this great honour and, indeed, a job, has not considered what might happen if a reform Bill is finally published.
Shipping: Piracy
(13 years, 1 month ago)
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Lord Naseby
To ask Her Majesty’s Government what action they are taking to mitigate and eventually eradicate the hijacking of United Kingdom shipping by Somali pirates.
The Minister of State, Foreign and Commonwealth Office (Lord Howell of Guildford)
My Lords, Her Majesty’s Government contribute warships to multinational counterpiracy operations and command the European Union operation. We work with industry to implement best management practice by ships to minimise the risk of a successful hijack, but the long-term solution lies on land with the rule of law and increased stability. The United Kingdom is leading international action in the Contact Group on Piracy off the Coast of Somalia to deliver a comprehensive response to Somali piracy.
Lord Naseby
Is my noble friend aware that the situation gets ever more serious? Two major tankers have been hijacked in recent days, nearly 800 hostages are being held, and now no less than 10 mother ships are extending the amount of ocean in which the hijackers can operate. Since we as Her Majesty’s Government are in the lead role, is it not time that in conjunction with our partners we use some of the UAV planes to pinpoint where these mother ships are and, if necessary, either sink them by an armed UAV or find some other means of sinking them? After all, the Tamil Tigers’ navy was put out of action only by the Sri Lankan navy sinking the mother ships.
Lord Howell of Guildford
My noble friend is absolutely correct. The situation is getting more serious every week. More and more ships are being attacked by the hijackers and the piracy operation is growing, so he is completely right to recognise the seriousness, as do Her Majesty’s Government. We are, as he says, in the lead on the Contact Group on Piracy off the Coast of Somalia. We are seeking to develop more substantial facilities to meet and track the pirates. The question of the UAVs is difficult. We have none, but of course our American allies do. A great many of these are currently deployed elsewhere, but my noble friend can rest assured that we intend to develop a more robust response in relation to these and other kinds of maritime air patrol because it is certainly needed.
Lord Anderson of Swansea
My Lords, the Minister will be aware of reports of a deal between the pirates and al-Shabaab, an affiliate of al-Qaeda in the Arabian Peninsula, whereby the terrorists cream off some of the money that goes to the pirates. Do the Government accept that this is likely to be true? If so, will it not have an affect on us in the possible financing of terrorism through the diaspora in the UK and in possibly making insurance companies in the UK liable for that financing?
Lord Howell of Guildford
I have certainly heard of these reports and there are a great deal of rumours surrounding the whole question of the relationship between pirates, pirate finance and terrorism in the region, but we have no firm evidence of this particular pattern of transaction. It is, however, something that we are investigating and watching very carefully indeed.
Lord Stirrup
My Lords, the Minister said quite rightly that the causes of piracy as opposed to the symptoms must be dealt with on land and cannot be dealt with at sea. Could he therefore tell us what progress is being made in engaging with, and building capacity within, what passes for the authorities in Puntland?
Lord Howell of Guildford
In Puntland, Somaliland and Somalia itself we are making efforts to reinforce the facilities for both the prosecution and the imprisonment of pirates, so progress is being made. Frankly, Puntland is a rather more difficult region than Somaliland, which is very co-operative. In Somalia itself the transitional regional Government are working to build prisons and improve facilities. There is, of course, the wider problem in Kenya with which the noble Lord will be familiar. Some progress is being made, but it is not very easy.
Lord Chidgey
Is my noble friend aware that since January the Indian navy operating some 600 miles or more off its western shore has sunk three pirate mother ships and captured over 100 pirates, who are now being interviewed about their connections with terrorism in Mumbai? The Indian Government are also bringing forward tough legal measures to help them tackle offshore piracy. What is our Government’s assessment of the proactive operational policies of India compared with the effectiveness of the EU operation, Atalanta, in both its maritime and its legal capacity?
Lord Howell of Guildford
Our assessment is positive, both of the Indian naval operations and the naval operations of other countries, including China. This is a co-ordinated effort, and maybe the co-ordination can grow tighter still. We think this should all carry forward in a closely integrated way. As to the legal aspects of the situation, there are the rules of engagement and the operational duties under which a sort of constabulary context is conducted towards pirates. This might need to become more robust in our different countries, but we have to stick by the law of the sea and we have to proceed carefully for fear of involving ourselves in far more complexities in this area, rather than reducing it and maybe being more effective against the pirates.
Lord Davies of Stamford
My Lords, I congratulate the noble Lord, Lord Naseby, on drawing the House’s attention to a very pressing problem that, in my view, has not had enough attention up until now. Is it not absurd that we in this country should be supporting no fewer than three task forces, potentially leaving our sailors and marines at risk of their lives there, and doing nothing at all to interrupt the constant flow of money into the hands of pirates? We have in this country an elaborate structure of criminal assets legislation and anti-money laundering legislation. Will the Minister have a word with his colleagues in the Department of Justice and the Home Office to see whether we cannot use these existing mechanisms to interrupt the flow of money that is making piracy a growing and increasingly profitable industry?
Lord Howell of Guildford
I do not quite accept the noble Lord’s point that we are doing nothing at all. He is quite right that this is a growing concern. We had an excellent debate on it just before Christmas and he is right to raise it again now. These are all areas where progress can be made. There is a contact group and a highly effective operation throughout Whitehall involving all departments in tightening the situation. We have to tackle all these matters and are doing so in many areas very vigorously. To say we are doing nothing at all is going too far, but if the noble Lord feels we should go further, clearly we should because the piracy issue is getting worse and not better.
Lord West of Spithead
My Lords, I, too, congratulate the noble Lord, Lord Naseby, on raising this issue. Does not the Minister think that now is the time to reinvigorate action in this whole area? It is becoming a really dangerous issue. I believe that something will happen in the near future that will make us all pay attention. For example, the loss of two LNG ships coming to the UK would affect energy supplies. There could be a huge catastrophe, and it really is time to reinvigorate our efforts. Should we not look at all the aspects of this problem that have been mentioned and push this very hard?
Lord Howell of Guildford
The noble Lord is right that the time has come, and Her Majesty's Government have recognised precisely the point that he makes. However, this has become a global issue; it could affect Chinese, Indian and Asian interests just as much as European and American interests. This task must be tackled on a global level with great vigour before it gets very much worse.
Police: Expenditure Cuts
Lord Kennedy of Southwark
To ask Her Majesty’s Government what impact the proposed cuts to the police service funding will have on operational effectiveness.
Lord Wallace of Saltaire
My Lords, I welcome back this familiar question in a slightly different form; no doubt we will see it again. The Government believe that police forces can make the necessary savings while protecting front-line services and operational effectiveness. Last year’s HMIC report identified £1.1 billion of savings that could be made while maintaining police availability. We have identified significant further savings, including through better procurement and sensible pay restraint.
Lord Kennedy of Southwark
I thank the Minister for his reply. Before the general election, the leader of his party—now the Deputy Prime Minister, Mr Nick Clegg—promised to recruit an extra 10,000 police officers. The reality, as a result of decisions that the Government have taken, is that we will have 10,000 fewer police officers. Is this not another example of the Deputy Prime Minister saying one thing to get elected and another when elected?
Lord Wallace of Saltaire
My Lords, we all have to pay for what we get. I was not aware until I saw a chart in the Guardian on 23 February that the previous Labour Government went into deficit on the Budget in 2002, ran an annual deficit on it of between £30 billion and £40 billion from 2003 to 2008 at the height of the credit boom, and therefore left us with no spare capacity when the boom collapsed. That is why we all have to take these difficult decisions.
Baroness Doocey
I declare an interest as a member of the Metropolitan Police Authority. Does the Minister share my view that the police could provide better value for money by cutting perks such as chauffeur-driven limousines for senior police officers rather than by cutting front-line services?
Lord Wallace of Saltaire
I had better declare that I travelled several miles in the chief constable of West Yorkshire’s car last week from one police building to another. There are of course areas where the police can cut, and a number of rather imaginative schemes are already under way. I was taken on that day to the Yorkshire regional hub, which the four separate Yorkshire police services now share for a number of operations. That is the sort of thing which we need to take further.
Lord Hunt of Kings Heath
My Lords, how many front-line police officers will lose their jobs in order to pay for the politicisation of the police force through elected police commissioners?
Lord Wallace of Saltaire
My Lords, we will come to the Police Reform and Social Responsibility Bill in good time. We have seen in the past couple of months the normal form of negotiation through the public media. I saw in early February a suggestion that Greater Manchester, for example, would lose nearly a quarter of its strength. We now hear Lancashire Constabulary, I am very happy to say, talking about possibly losing up to 160 policemen in front-line positions. We are beginning to discover that it will be not be as difficult as we feared. Her Majesty’s Inspectorate of Constabulary last week indicated that it expects much fewer police job losses than originally forecast. The Metropolitan Police, accounting for a quarter of all officers in England and Wales, has indicated that it will begin recruiting again shortly.
The Earl of Listowel
My Lords, is the Minister aware of the widespread concern about the impact of cuts to police funding on the child protection role of the police? Can he provide some reassurance on this point?
Lord Wallace of Saltaire
My Lords, one of the principles of this Government is to reduce the different pots under which funding is provided to the police and to allow the police to choose how they spend their money. Some areas of the country require much greater effort on child protection than others. We look to police forces, authorities and, in future, the commissioners who will keep them under check to choose their priorities in the light of local needs.
Lord Hamilton of Epsom
Does my noble friend accept that the Benches opposite may accept that the deficit needs to be reduced as a general argument, but that they will not agree to any measure in particular?
Lord Wallace of Saltaire
My Lords, we all face a structural problem that the media and many of the public want higher quality public services and lower taxes. The call from the Labour Party for cuts in VAT, rather than to talk about how we pay for what we need in maintaining public services, is a good example of that.
Baroness Farrington of Ribbleton
My Lords, would the Minister care to answer the specific question about money being spent on implementing a policy which to my knowledge his party never voted for—single police chief commissioners? I declare my interest as having served for 20 years as a member of a police authority. Responsible chief constables are saying that to achieve savings of the magnitude needed, even if we accepted that they should be made, requires lead-in time. Rather than have these phoney elections, which will have to be backed up by panels to represent the whole community in the police authority, as the Government have accepted, would it not be better to spend the money on that? I have not met a single senior police officer whose priorities would be different from mine.
Lord Wallace of Saltaire
My Lords, I am deeply surprised that the noble Baroness was not aware of the 2006 Liberal Democrat party paper on public service reform, which did indeed raise the question of directly elected police commissioners, so it is not entirely new to our party. I understand that the Labour Party is proposing instead that one should have directly elected chairs of police authorities. I cannot quite get my head around how different that is from what we are proposing.
Warm Home Discount Regulations 2011
(13 years, 1 month ago)
Lords ChamberRead Full debate Read Hansard Text Read Debate Ministerial Extracts
Lord Strathclyde
That the draft regulations and orders be referred to a Grand Committee.
Energy Bill [HL]
Baroness Anelay of St Johns
My Lords, I have it in command from Her Majesty the Queen and His Royal Highness the Prince of Wales to acquaint the House that they, having been informed of the purport of the Energy Bill, have consented to place their prerogative and interests, so far as they are affected by the Bill, at the disposal of Parliament for the purposes of the Bill.
Clause 3 : Framework regulations
Amendment 1
Lord Marland
The Parliamentary Under-Secretary of State, Department of Energy and Climate Change (Lord Marland)
My Lords, it is amazing that, although I thought this is a fascinating Bill, the Chamber seems to be emptying quite quickly. I will do my best to encourage everyone.
Before commencing these amendments, I would like to place on record my thanks to all noble Lords for their magnificent contributions. Although those on the opposition Benches will not like it, this has been done in the true spirit of coalition across all parties. I would particularly like to thank those on the opposition Benches for everything they have done in making this Bill fit for purpose. I have been incredibly well assisted by the noble Baroness, Lady Northover, who has worked tirelessly on our account and I thank her very much.
I also thank our officials for their tireless work. The Bill will have passed through this House voteless—at least I hope that it will—and that would not have happened without substantial briefing and explanation to noble Lords during the course of the Bill. I want to thank my officials and everyone for that. As such, these government amendments show that we have listened to noble Lords, particularly on the opposition Benches and my noble friend Lord Deben. I hope that the first group of government amendments are accepted by the House.
Baroness Maddock
My Lords, during the passage of the Bill, I moved several amendments on, and we had long discussions about, the private rented sector. At Report, the Minister said that he agreed in great part with what I was saying and that he hoped to be able to bring forward amendments on the private rented sector going further than they had previously. They have gone a little bit further today. I hope that, as the Bill passes through another place, the Government will be able to take a slightly closer look at the private rented sector.
In the time that we have been discussing the Bill, the most recent English housing survey has been published. It shows that the number of properties in the private rented sector has increased by 1 million in the past 10 years. Such properties now account for 15.6 per cent of England’s housing stock and that number appears to be rising all the time. I remind the Minister, although it will not be his responsibility in the other place of course, that 20 per cent of private rented sector households live in fuel poverty. If we look at the bottom end—at bands F and G, which are the groups that I have spent a lot of time discussing during the passage of the Bill—that rises to 42 per cent. I have said at least twice during the passage of the Bill that, in many cases, we are footing the bill for the rent of these properties through housing benefit.
I thank the Minister for moving a little in my direction and I hope that his colleagues in another place will be able to take a further serious look on these issues.
Lord Best
My Lords, the amendments that I tabled called for a legally binding minimum standard of energy performance by the year 2016, but the Minister has not been able to concede that. I accept that the amendments that he has tabled are a small but helpful step in the right direction, but I want to place on record that I fear that the private rented sector will not do what it should do without a legally binding minimum standard being introduced by the Government for local authorities to implement. Without that, I fear that the Green Deal will not be as effective as it otherwise should be. But it is now for another place to discuss and I am grateful for the modest but important concessions that the Minister has made with these amendments.
Baroness Smith of Basildon
My Lords, I echo the Minister's comments about how the Bill has been conducted. It has been a great example of your Lordships working together to bring forward suggestions. I praise the Government for their efforts to look at the suggestions and amendments and bring forward amendments of their own. I recall at Second Reading the Minister said,
“I will clarify that this is a framework Bill on which there is a lot of work to be done”.—[Official Report, 22/12/10; col. 1151.]
During our deliberations, particularly in Committee and at Report, we have undertaken a lot of that work and brought forward amendments.
I also echo the Minister’s thanks to his officials who have been very co-operative with us. We are grateful for that help and support. I also place on record my thanks to the many organisations that contacted us during the course of the Bill, such as Friends of the Earth, the Association for the Conservation of Energy, the World Wide Fund for Nature and many others. Their work and that of the energy companies have been endless. I have had more e-mails and briefing on this legislation than I have ever had in my entire parliamentary career. It has been very welcome and appreciated and we do not take that support and advice for granted.
Baroness Parminter
On behalf of these Benches and in the absence of the noble Lord, Lord Teverson, who is serving the House in another place today, I add our thanks for the way the Minister and his team have handled this Bill and the co-operation we have had from officials. It has been much appreciated. In particular, on Amendment 1, the way that the Minister has listened to the comments from across this House on the issue of moving from “may” to “must” well reflects the concerns that many of us have had about the need to upgrade consumer protection, if we are to make a reality of the Green Deal and all the aspirations that the Government rightly have for delivering our targets on lowering carbon emissions. It is an extremely welcome step and is an indication that the Minister is listening on this issue, as indeed he has on many others.
I remain disappointed that I was unable—either through lack of eloquence or other means—to persuade the Minister that provision for a consumer ombudsman was needed in this legislation. However, I accept what he has said and what his officials have confirmed, that the legislation is enabling in such a way that, should the Secretary of State feel that is desirable, that option remains open. I believe that an ombudsman for the general public is going to be essential in this important area and that this will be something that will come forward, if not in another place, then certainly in the future.
Amendment 1 is a welcome indication that the Minister is listening and confirms that he has been paying attention to the many useful points of clarification that have come from Members who all support ensuring that this Green Deal works.
Lord Whitty
My Lords, until the noble Baroness made her last point, I was not going to intervene on this amendment, but I would like to associate myself with the words of both my noble friend Baroness Smith and the noble Baroness, Lady Parminter, regarding the way the Committee and Report stages of this Bill have been conducted. I appreciate that the Minister has come some considerable way towards meeting a number of concerns although on this particular one I think the noble Lord, Lord Best, is correct about the need for minimum standards and the noble Baroness, Lady Parminter, is right about the need for consumer protection.
It is important that the Government and the House recognise that, in supporting the provisions of this Bill on the Green Deal, we all recognise that there is still a substantial amount of work to be done in putting the deal together and thereby inspiring confidence in householders and landlords, on the one hand, and in the various different parts of the supply chain, on the other, which will need to act together to deliver the Green Deal.
At several points—I will return to this on a further amendment—during the discussion in Committee and on Report, the Minister said we may need to make a number of amendments in another place. I think the Government will find that there are some anxieties both in industry and on the part of consumers about how exactly the Green Deal is going to be sold and how it is going to be delivered. I suspect therefore the Government need to remain open to the possibility of amending the Bill in another place. I think everybody who was involved in the Committee wish the Green Deal good speed. However, we also know that there are some problems ahead and the Government would be wise to be flexible.
Lord Marland
Again, I value very much the comments made by noble Lords. These comments have been made on several occasions and I am grateful for the compliments that have been made. The noble Baroness, Lady Parminter, was the most complimentary so she is top of my class. Seriously, I am grateful to everyone for their kind words.
The noble Lord, Lord Best, made a very good point about PRS properties and with that in mind we have brought forward the idea of a review in 2013. It is fundamental that we make great inroads into the private rented sector—particularly the F and G categories my noble friend Baroness Maddock mentioned and raising them to the minimum standards of category E —and the Government are extremely committed to that. However, we should allow the sector to lead by example to start with and if it does not take that opportunity then we must help it on its way. The Government are committed to taking people out of fuel poverty. That is part of the reason for the Green Deal building on other initiatives that have taken place; it is fundamental and we owe it to the country to get people out of fuel poverty.
The noble Baroness, Lady Smith of Basildon, asked me whether things that I said on Report stand now. I can confirm that they were on the record and I meant what I said. She can take heart from what I said then and the disappointment that she had with these amendments will be carried through into another place and will be left for them to debate. I am sorry to hear there is a little bit of disappointment, but we have, I hope, persuaded and also given way on a vast number of amendments. It would nice every now and then if everyone carried me rejoicing from these Chambers saying how marvellous it was—I do not think I am going to get that—but in any case I hope I have responded to the questions.
Lord Marland
Lord Marland
My Lords, in break with tradition I am going to read a script I have been given because these amendments are complicated. They make small technical changes to Clauses 17 and 20 ancillary to amendments made on Report that apply to the Secretary of State’s power to make licence modifications.
Amendment 2 clarifies Clause 17(3)(f) and provides that provisions can be made in licences requiring payments to be made by or to licensees as well as enabling such payments to be made.
Amendments 3 and 4 provide that licence modifications made under the powers in Clauses 17 and 20 can be of the type envisaged by Section 7(3)(a) or (c) and (4) of the Electricity Act 1989 and Section 7B(5)(a)(i) or (iii) of the Gas Act 1986. Now you can understand why I read this out. I hope that these amendments will be supported. I beg to move.
Lord Marland
“( ) Conditions included in a licence under section 7 or 7A of the Gas Act 1986 by virtue of the power under subsection (1) may do any of the things authorised by section 7B(5)(a)(i) or (iii) of that Act (which applies to the power of the Gas and Electricity Markets Authority with respect to licence conditions under section 7B(4)(a)).
( ) Conditions included in a licence under section 6(1)(c) or (d) of the Electricity Act 1989 by virtue of the power under subsection (1) may do any of the things authorised by section 7(3)(a) or (c) or (4) of that Act (which applies to the power of the Gas and Electricity Markets Authority with respect to licence conditions under section 7(1)(a)).”
Lord Marland
“( ) Conditions included in a licence under section 6(1)(d) of the Electricity Act 1989 by virtue of the power under subsection (1) may do any of the things authorised by section 7(4) of that Act (which applies to the power of the Gas and Electricity Markets Authority with respect to licence conditions under section 7(1)(a)).”
Lord Marland
Lord Marland
Lord Marland
Lord Marland
Lord Marland
Lord Marland
Lord Whitty
“Smart metering strategy
(1) The Secretary of State shall, following consultation with energy consumers and other interested parties, prepare and publish a strategy to deliver the intended benefits of smart meters to consumers, including in particular low income and vulnerable consumers.
(2) It is the duty of the Secretary of State to report to Parliament on the progress of smart meter roll out every year starting from six months after the coming into force of this Part.
(3) In preparing the strategy the Secretary of State must set out how the smart meter roll out will—
(a) deliver to consumers the benefits identified in the impact assessment of July 2010;(b) ensure adherence to an independent code of practice for installation;(c) contribute to the carbon targets specified in the Climate Change Act 2008;(d) contribute to the elimination of fuel poverty as specified in the Warm Homes and Energy Conservation Act 2000;(e) improve competition in the energy retail market, including in particular in relation to prepayment customers;(f) provide for the interoperability of smart meters;(g) work alongside wider Government programmes such as the Green Deal and water metering roll out.(4) The report should cover progress on the delivery of smart meters, including—
(a) the number of smart meters installed in the United Kingdom, defined as per the Ofgem definition of a completed installation;(b) the costs and savings of the smart meter roll out;(c) the estimated benefits to consumers and taxpayers of the smart meter roll out, with particular reference to low income and vulnerable consumers;(d) estimated effects on the levels of fuel poverty;(e) the estimated energy and carbon reduction from the smart meter roll out;(f) the degree to which interoperability of smart meters has been achieved;(g) customer satisfaction indicators, including levels of complaint;(h) security of smart meters and smart grids in relation to privacy and commercial confidentiality.”
Lord Whitty
This is in a sense left-over business from Report stage. Again, I am not looking to the Minister to accept the amendment as it stands but to recognise that some of the issues that it brings up need to be addressed by the Government during the Bill’s stages in the Commons, one hopes, or possibly in secondary legislation.
The amendment deals with smart meters. We have had substantial discussions on smart meters in Committee; it is a very small part of the Bill but a very big part of the whole strategy for tackling energy efficiency in buildings, fuel poverty and the price of bills for everybody. Smart meters will therefore be key in improving energy efficiency, changing the behaviour of householders, reducing bills and providing the basis for introducing rather smarter grids into our electricity supply system. However, there are issues relating to smart meters. Unlike the Green Deal, which is voluntary for the householder or landlord, the smart meter is mandatory on the supply company and therefore, in effect, mandatory on the consumer, in that at some point the supply company will have to enter the house and replace existing meters and wiring with ones susceptible to smart metering.
I strongly favour this process and think that it will make a big contribution to energy efficiency; I think that at least some consumers will be able to alter their behaviour significantly and that we should therefore all support the strategy. However, there are some clear anxieties among consumers about the whole prospect of smart meters, some confusion about how they are to be delivered and in particular some concern about the lack of standardised and interoperable meters. I realise that on that front the Government are attempting to bring together the companies, and we are making some progress, but those concerns exist. There are also serious concerns, which noble Lords may regard as irrational, about privacy and what use may be made of the records of energy use. We must recognise those problems and recognise the possibility of serious consumer resistance that needs to be built in to how the rollout is delivered. It was an opportunity in this Bill to give a clearer framework to the totality of the smart meters’ rollout. We are three years on from the 2008 Act and, clearly, there have been developments and slight changes in approach. The clause that would immediately precede the new clause that I propose is, in effect, simply to extend the possibility of altering licences to transmission licences. That may or may not be necessary, but it will probably be necessary in some circumstances—and I certainly support that change. Given that smart meters are such a major part of the provisions and we rely so strongly on them to reduce household energy use, we should perhaps have used the Bill for a slightly wider purpose.
Lord O'Neill of Clackmannan
My Lords, I support my noble friend on this amendment, although I have to say that we tend to forget that at the moment a substantial number of meters are replaced every year. The replacement meters have been either replicas or slightly more updated versions of the previous ones. Sometimes they are placed in a different part of the household. If you are lucky, you might even be able to get the utility company to put one in your garden, if you have a garden, so that they do not have to come to your house to read it. What we are talking about initially is scale of operation. We have ambitions for 26 million households—18 million gas meters and some 25 million or 26 million electricity meters to be installed over a 10-year period.
I understand that that work is now going on at quite a rate in some of the utility companies. It would be unfortunate if, in such a large and potentially intrusive operation that will go into every household in the country, a clear form of parliamentary accountability were not involved. Obviously, in order that there be parliamentary accountability we need to know what is happening. I would therefore have thought that an annual report, while it might not be required reading for every Member of the Commons and the Lords, ought to be required reading for members of the appropriate Select Committees which take an interest in these matters. If necessary, that report could be debated annually in both Houses.
Many of us are concerned that we are still rather vague about what is being suggested for this rollout. This amendment goes some way towards identifying a number of concerns and issues. One thing perhaps missing from the amendment is sufficient reference to providing the consumer or householder with adequate information on how the meter operates. If the Minister were to accept the spirit of the amendment, however, he might go away and add to it. If we are to take advantage of the so-called smart element in these meters, it is important that the public understand what is shown on the dials in their kitchens, their gardens or wherever and what those dials can do to help them to use their energy more efficiently and make savings that might mitigate the price rises for electricity and gas that we all anticipate during this introduction.
In principle, this amendment is a good idea. If the Government accept it in spirit, they should be given an opportunity to go away and provide something of their own. A number of bodies outwith this House would want to be able to take the evidence that such a report would provide—for example, the Fuel Poverty Advisory Group which provides help and assistance to Ministers on fuel poverty. It would be emboldened and assisted in its work if it had the kind of technical information from such a report as is being suggested by my noble friend’s amendment, so I give this my full support.
While an amendment of this complexity is easy for Governments to knock down, it might not be the last word on the subject, and it is incumbent on the Government to provide that. That will be a report of sufficient meatiness that it could be chewed over by interested parties and Members of both Houses, and could provide the companies with sufficient information and evidence to be able quickly to change anything that is wrong with the way they are going about their work. One problem that we can envisage here is that the scale of this operation is likely to create something akin to a juggernaut moving across the country and trampling households under its wheels.
Everybody wants to see the introduction of smart meters but it is incumbent on the Government, who have the responsibility of directing that if not actually implementing it, to ensure that public confidence both in the companies and in the whole concept is maintained. I do not think that we have heard many complaints about the work already done. However, it is too soon to reach conclusions, and any horror stories might well jeopardise a project in which everyone sees great virtue. I support my noble friend’s amendment.
Lord Oxburgh
My Lords, I, too, have substantial sympathy with the amendment. Before one starts talking too much about juggernauts, it is worth placing on record that we had to have our domestic electricity meter changed a month ago. From the time the man who was doing the work came through the door to the time he left was about 12 minutes. It is a quick and easy operation, certainly so far as electricity meters are concerned.
However, an important point has been missed. By and large, the electricity companies have a poor understanding of their customers simply because they have no way of disaggregating their demand. With a better understanding of why, how and when loads peak in particular areas, which they do not have at the moment, a significant indirect benefit should be possible for consumers, which would be reflected in reduced electricity charges, because we may well be able to run the electricity system with a lower generating capacity than at present because of our limited understanding.
Lord Jenkin of Roding
My Lords, one matter which is not dealt with in the amendment—I do not know what my noble friend’s reaction to this will be—is the question of the training of the technicians whose job it will be to install the new smart meters. Some noble Lords may recollect that I pursued this issue over the past year or two with the previous Government. I was informed that the sector skills council which dealt with this—the Energy and Utility Sector Skills Council—had applied for the necessary financial support to enable it to lay out a training programme for smart meter installers, only to be told that that could not be done under the then system, which I hope is in the process of being changed. I raised the matter with the previous Government and the noble Lord, Lord Hunt of Kings Heath, who undertook to look seriously at it, and I have pursued it with other Ministers in the present Government.
Attention needs to be given to this matter because, as a number of speakers have said, if people are going to go into consumers’ houses it is important that they are properly trained to do the work. If eventually, as I have heard said, we are going to have combined gas and electricity meters—but perhaps not at the first stage—that will require a considerable new approach to training.
I have supported the smart meter programme from the beginning and have had some representations—not pressure; that would be the wrong word—made to me that it is a con trick in favour of electricity suppliers and distributors. I do not for one moment accept that argument. As speakers on all sides of the House have said, if it is properly handled and people are given all the information that they should have, which is very important, this could be of real value to consumers. The noble Lord, Lord Whitty, was wise to say that he did not really expect the Government at this stage to accept the amendment but, at some stage, something of this kind will be needed and I hope that it will cover the training of technicians as well as the other matters set out in the amendment.
Lord Grantchester
My Lords, it is clear that smart meters will play an important part in identifying energy usage to consumers and highlighting the impact of energy efficiency measures in the home. Consumer confidence in their operation is crucial.
The noble Baroness, Lady Northover, dealt comprehensively on Report with the intentions behind the amendments and gave a full account of the work her department was doing with the industry and in the discussions regarding a code of practice. It is important that the Government show leadership in this area. The House looks forward to receiving the noble Baroness’s department’s conclusions on this process, as there will clearly be a need for further work to develop the benefits and underline the importance of consumer engagement.
It is important that there is a strong programme on the management of the operation of smart meters, and we support my noble friend’s call that the department reports to Parliament on the measurement of the benefits they will bring to enable full accountability to take place.
Lord Marland
My Lords, may I say how delighted I am to see the noble Lord, Lord O’Neill of Clackmannan, in his place? He watched at first hand the horrific events in Japan, where I spoke to him. What an awful time that must have been for him. We are delighted to see him back and, as usual, making some very interesting points.
The amendment of the noble Lord, Lord Whitty, is extremely valuable. He makes, as always, some very good points. Fundamental to this debate has been public confidence: the public must have confidence about the rollout of smart meters. As a department, we are committing a substantial amount of resources to smart meters, as we must get this right. I am not sure that all operators will be as good as the one who came to the home of the noble Lord, Lord Oxburgh; I suspect that, because of his great scientific knowledge, the noble Lord was telling the operator how to install it. Twelve minutes sounds like a very good target for anyone to try to achieve. The training of technicians is fundamental, as the noble Lord, Lord Jenkin, said; there must be great vigilance in this area so that the consumer can have confidence.
The noble Lord, Lord Whitty, made two specific points on the strategy for consumer benefits. We have been carrying out consultation since July on the wide-ranging subject of smart meters. A principal consideration has been a strategy for consumer benefits. We will publish our findings by the end of this month, and I hope that the other place will have the opportunity to debate them.
The Government are sympathetic when it comes to transparency regarding information about and the progress of smart meters. I can assure the noble Lord, Lord Whitty, that we will be developing arrangements for reporting the benefits of smart meters, the progress of the rollout and the delivery resulting from the benefits. That is fundamental not only to the public but to the Government, as we need to know what progress we are making. I hope that I have given the noble Lord confidence that we will take this matter forward in the other place and that he will therefore withdraw the amendment.
Lord Whitty
My Lords, I thank the Minister for that explanation and the other speakers in this debate, particularly my noble friend Lord O’Neill. The noble Lords, Lord Oxburgh and Lord Jenkin, made important points that will need to be borne in mind during the rollout. Technical training in fitting meters and explaining to consumers how to use them will be an important part of the rollout, so customer service training as well as straightforward technical training will be necessary.
With a bit of willpower, these issues can be overcome. When we shifted to requiring A or B boilers a few years ago, the industry threw up its hands in horror and said that it did not have enough people to do that. However, we rapidly got a programme in place which enabled us to do it. It required a little bit of cross-Whitehall arm-twisting; I expect that the Minister is adept at that, and he may need to use that skill.
I am particularly pleased to hear that the assessment of consumer reaction, which I was aware the Government were undertaking, will be available to our colleagues in another place before they reach their final conclusions. The Minister will know that Consumer Focus, which I formerly chaired, has conducted a fair amount of research on this issue. It will be regrettable, if the Public Bodies Bill is passed, that it will not be in a position to do so on future occasions. It certainly threw up a number of incipient difficulties which are not insuperable but they are significant.
As noble Lords have said, we have to provide confidence. One problem is that the industry has a fairly low rating among consumers, and trust in energy supply companies, which will have to ensure that smart meters are installed, is pretty low. They have made some significant improvements in recent years but they have a poor history to overcome. I am afraid that that still informs a lot of customers’ attitudes towards those companies and causes them to make inferences about the reason for introducing these new machines into their houses. There is some suspicion surrounding the use to which the energy companies may put the data, whereas we can see that the data could be used to provide electricity in a smarter, more intelligent and more cost-effective way. From the other end of the telescope, people are wondering why their supplier needs to know whether they have the kettle on at four o’clock in the afternoon. That is an exaggeration; nevertheless, it is a fear that needs to be addressed in the Bill and in the regulations that come under the Bill, as well as in the way that the Government oversee the whole operation. I think that, from what the Minister has said, our colleagues in another place will have sufficient information on which to base their discussion on this matter. In the light of that, I beg leave to withdraw the amendment.
“3A Report on compensation for petroleum spills
(1) The Secretary of State must publish a report every five years about the arrangements in place in the United Kingdom for petroleum companies to compensate for any damage caused, or loss suffered, as a result of petroleum being accidentally released during the operation of licences under this Act.
(2) The report must, in particular, include—
(a) the amount of insurance coverage that industry members have agreed should be available in the circumstances outlined in subsection (1);(b) the Secretary of State’s opinion about whether the amounts are adequate to compensate for any damage caused in the circumstances outlined in subsection (1);(c) the factors that the Secretary of State took into account in reaching the Secretary of State’s opinion under paragraph (b); and (d) the actions that the Secretary of State intends to take, in the event that the Secretary of State considers the amounts to be inadequate.”
Baroness Smith of Basildon
My Lords, in replying to the first group of amendments, the Minister expressed regret that, having made very modest but nevertheless welcome amendments, he was not carried aloft from the Chamber in jubilation. Never liking to disappoint the noble Lord, I offer him another opportunity. My foot may not be fully recovered but I might manage to carry him aloft should he want to accept the amendments that we are putting forward today. I reassure the Minister that the only reason that we on this side have put forward any amendments is to seek to improve the Green Deal and to ensure its success, and I assure him that the same applies to this amendment.
The noble Lord will recall that I raised this matter in Committee and on Report. When, on Report, I raised a similar issue about compensation and payments relating to petroleum spills, he assured me that he knew more about this issue, having been involved in insurance himself, and he patiently explained that he would write to me with further information. He has done so and I thank him. It has helped to clarify the situation, and I appreciate his responding in such detail. However, it is that response that has led to our tabling this amendment.
I was seeking assurance in the Minister’s response about where the liability would fall in the event of an oil spill, and I referred to Deepwater Horizon, which we had previously discussed in your Lordships’ House. He informed me that the Oil Spill Prevention and Response Advisory Group had set up an indemnity insurance group to review the current provisions of the OPOL agreement, as well as the financial and cross-indemnity arrangements behind the current mutual co-operative industry’s mechanism on this issue. I understand that, at the department’s request, the group has reviewed the modelling based on worst-case scenarios, on which the liability limit is based. It has also commissioned modelling of alternative spill scenarios with the aim of providing a more comprehensive picture of potential oil spill costs, and there will be further discussions on this. The Minister told me that the work is ongoing. However, he also assured me that, if that work indicates that a credible worst-case scenario could result in damage exceeding $250 million, the Government will require higher levels of cover. All that my amendment would do is build on what the Minister said a moment ago when he referred to his commitment to transparency and to monitoring the situation. It would be helpful for Parliament and those who are interested to know that the insurance available to deal with these catastrophes is at the appropriate level. That will happen only if there is a review and transparency.
The amendment requires the Secretary of State to publish a report every five years about the arrangements that are in place and specifies some issues that must be included. I hope that the Minister will look at this amendment. If he is unable to accept it today, perhaps it can be discussed with colleagues in the other place. I welcome the opportunity to carry him aloft from the Chamber should he wish to accept the amendment at this point.
Baroness Northover
My Lords, we are very sympathetic to the concern expressed behind the amendment and we have debated both in Committee and on Report the issue of compensation for oil pollution. The main concern in these debates was that arrangements should be in place to ensure that companies could meet any liability arising from oil pollution during their licensed operations.
We explained in these debates that there are indeed appropriate requirements in the licences and that the industry has in response formed a voluntary liability pool, the Offshore Pollution Liability Association—OPOL. OPOL membership requires operators to demonstrate provision to meet clean-up costs and associated damages of up to $250 million on a basis of strict liability in the event of a pollution incident. OPOL also collectively provides a back-up mechanism that in the event of default by any operator, the other members will meet claims for clean-up and associated damages up to the same financial limits. That liability pool is unique to the North Sea, and we believe that it provides a very solid assurance that all pollution liabilities will in practice be met. I particularly stress the significance of the acceptance of strict liability by OPOL members, which means that anyone who has suffered loss as a result of pollution from an oil installation does not have to show that the operator is at fault. He or she merely has to establish that the damage or loss is a result of the pollution. As I have said, it is unique to the North Sea.
Since Report, my noble friend Lord Marland has written to the noble Baroness, Lady Smith, with further details of this arrangement and I thank her for her very positive response to that correspondence. This amendment, however, addresses a slightly different point from the amendments tabled in Committee and on Report. We made the point that the amendments tabled then were unnecessary as appropriate requirements were already in place. The focus of this amendment is rather that the Secretary of State should publish a report on the arrangements in place, the amount of insurance cover provided, and so on. We are wholly sympathetic to the idea that more public information should be available on these matters. As the noble Baroness notes, further work is ongoing under the auspices of OSPRAG, in which government and industry are working together to review the industry’s practices in the light of what has been learnt from the Macondo disaster. One of the OSPRAG working groups is specifically addressing liability and indemnity issues. We are happy to undertake that the Government will make an appropriate statement in the House on the outcome of this work and any changes that may appear necessary or desirable. I hope that that reassures the noble Baroness.
As for future developments, the department is committed to laying an annual statement before the House, and we will, of course, use that to report on any new developments or proposed new measures. In the light of those reassurances, I hope that the noble Baroness will feel able to withdraw her amendment.
Baroness Smith of Basildon
I am grateful to the Minister for her response. It covers a number of the points that I was seeking to address, mainly transparency and the responsibility of government in reporting back to Parliament. On the basis of her response, I am happy to withdraw the amendment.
Lord Jenkin of Roding
“(2A) In the application of section 157(2), for paragraph (b) substitute—
“(b) that the company is likely to be unable to pay its debts and that the directors of the company have consented on that basis to the making of the order; or”.”
Lord Jenkin of Roding
My Lords, I raised this issue in Grand Committee and briefly on Report when my noble friend Lady Northover was kind enough to say:
“I think the best way to take this forward is by consultation. If he would like to discuss the details with officials, we could see what, if anything, needs to be addressed”.—[Official Report, 2/3/11; col. 1163.]
With the help of her officials, I did just that. I had a very interesting telephone conversation and subsequently a paper from a very helpful lady, Dawn Armstrong, in the Department of Energy and Climate Change. Briefly, the issue concerns the power of the Government to put an energy supplier into special administration. It is built on extending the powers in Section 157(2) of the Energy Act 2004 as adapted and applied by Clause 93. Section 157 is headed “Powers of Court” and subsection (2) states:
“The court may make an energy administration order in relation to a company only if it is satisfied— (a) that the company is unable to pay its debts; (b)—
and these are the critical words that I am unhappy with—
“that it is likely to be unable to pay its debts”.
Then there is a third ground on which it might be appropriate to wind the company up in the public interest. The Insolvency Act, on which these words were originally based, included the words,
“likely to become unable to pay its debts”,
but in those circumstances it was only on an application by the directors of the company. Under Clause 93, it is a power of the Secretary of State, or of Ofgem with the consent of the Secretary of State, to apply to put a company into what is called special administration under this Act.
Ms Armstrong sent me an extremely helpful note, much of which I accept. For the benefit of what I hope will eventually be a debate in another place on this subject, I shall read part of it out. She wrote:
“Administration under the Insolvency Act 1986 is a business rescue procedure, with the survival of the company as its primary objective. If entry to administration were only available to a company that could not pay its debts at the date of commencement, the rescue of viable businesses might be jeopardised. For this reason, administration can also be entered when a company is likely to become unable to pay its debts. The clauses in the Energy Bill on special administration follow these principles. The energy supply company administrator’s primary objective is to rescue the company as a going concern. Therefore these provisions apply the same tests for insolvency as the Insolvency Act”.
She used the words “the same tests”. Yes, they are the same tests, but not by the same process. That is basis of the anxiety. I accept that there is a need for a process. There is no question about that. When you have a large energy supply company supplying millions of customers and it seems unlikely to meet its obligations, obviously the authorities must step in and do something about it.
The second point made in the paper, which I had perhaps not entirely appreciated, was that this applies only to supply companies and would not affect the generating part if it were in a separate company in the group. I am not sure that I wholly understand that because it is difficult to imagine a supply company unable to pay its debts if the company is otherwise solvent, but that point might need to be taken.
The third point made in the paper is that it is a court process and not just a peremptory decision made by the Secretary of State or by Ofgem. It is a decision to take the matter to the court and for the court to decide. I will return to that in a moment. My noble friend Lord Marland wrote to me on this matter. He wrote:
“Of course The Secretary of State and Ofgem would no doubt want to discuss any application for an energy supply company administration order with company directors in advance. And directors will be able to contest the application in court. However, enshrining a duty to consult directors in the legislation could lead to delay and it is important that the Secretary of State has the flexibility to act quickly”.
I think that my noble friend might have misunderstood the purport of my amendment. I should thus like to make four points about that, and no doubt my noble friend Lady Northover will be able to reply. First, in my discussion with her official, she made the point that she thought that very few of the energy suppliers were worried about this. Since then I have made inquiries and have been told that the energy suppliers are solidly behind this amendment. I have had letters from two or three of them to confirm that point. It is not true to suggest that this is somehow only a minority concern. The industry’s points of opposition to the special administration threshold—because that is what we are talking about—are vigorously maintained.
Secondly, the official’s note is a perfectly adequate summary of the principles of the special administration regime. It also properly acknowledges that this regime does not disapply the provisions of existing insolvency law. However, it does not seem to acknowledge that the test for putting an energy supply company into special administration is set at a very low threshold: that is, lower than the threshold at which Ofgem can revoke a company’s licence under the licensing provisions. If a licence is revoked, the practical effect is to put the company into special administration. It is certainly, in at least one crucial respect of its business, the inability of the directors to carry it on.
I made further inquiries about the licence. Is it different or does it cover broadly the same process? Ofgem can revoke an energy supplier’s licence on a number of grounds, including if the company has committed an offence while making its original application or if it has failed to comply with a final enforcement order in respect of a breach of a condition or something of that sort.
However, the ground that is relevant to this amendment is that which applies when the company is in financial difficulty. In that event, Ofgem can revoke the company’s licence if the company is unable to pay it debts. There is no permission or discretion to revoke the licence if the company is likely to be unable to pay its debts. Why is it necessary, therefore, to put this provision about,
“likely to be unable to pay its debts”,
into the administration procedure under this Bill when it does not exist under the licensing provision?
More than that, the licensing provision sets out clearly what the court needs to be satisfied with before it withdraws the licence. The company is not to be deemed to be unable to pay its debts unless at least one written demand by a creditor for a sum of more than £100,000 has remained unpaid for at least three weeks. Nor is the company to be deemed to be unable to pay its debts even if such a written demand is outstanding, provided that the company is contesting it in good faith and with due recourse to all appropriate legal process. That seems to be quite different from what we are being asked to legislate in Clause 93. This power of the Secretary of State to go to the court and apply for a special licence is questionable. The contrast between that power in the Bill and the power to revoke a licence seems very stark. In the power to revoke a licence, there is no reference to the company being unlikely to be able to pay its debts, and the definition of what constitutes an inability to pay its debts is detailed and specific. Neither of these applies to the provision in the Bill. That point was not made during the earlier debates.
The third point, which I did make, was that we have had practical experience of the use of the power to put a company into administration if it is deemed to be unlikely to pay its debts. That happened in the case of Railtrack. There was an accountant’s report, which was all that was necessary, to suggest that Railtrack was going to be unable to pay its debts, so off went the Government to the court, and we all know the history after that. This has been widely commented on. It was not, even at the time, entirely bona fide. A political objective was being sought. It is that kind of thing that is causing concern and uncertainty in the industry.
My last point is that my noble friend’s letter, which I referred to a moment ago, raises the idea that I am trying to enshrine a statutory duty to consult directors. He says it would cause delay. In the circumstances that we are considering, a week or two’s delay does not seem very important. However, my amendment does not impose a duty to consult. It says that the court can make a special administration order only if it is satisfied that the company is likely to be unable to pay its debts and that the directors of the company have accepted that to be case and have consented to the order on that basis. To put it bluntly, the directors will have their day in court and that is how it should be. This amendment provides the beginnings of a safeguard against the situation that Railtrack was put in whereby special administration was imposed on the company simply on the say-so of an accountant’s report.
I entirely accept, as I said a few moments ago, that the authorities need to have the power to help a company to carry on its business if it is in difficulties for the protection of both the business and its consumers and, as my noble friend said, to spill over into other companies. A rescue package might have to be mounted, but I contend that this must be done in a way that does not sow uncertainty and raise the risks for investors and their suppliers. My evidence that that is the fear that the industry has at the moment is strong. The amendment seeks to enshrine a safeguard in the Bill to avoid that. I beg to move.
Baroness Northover
My Lords, we are grateful to my noble friend for raising this important issue, which enables us to clarify further and to put the arrangements on the record. We understand that there might be concerns that the tests for insolvency set out in these provisions appear to be rather wide, but they are statutory tests for insolvency as set out in the Insolvency Act 1986. As my noble friend has indicated, it is also a matter of balancing the interests of the companies, consumers and the public interest.
Administration under the Insolvency Act 1986 is a business rescue procedure, with the survival of the company as its primary objective. If entry to administration were available only to a company that could not pay its debts at the date of commencement, the rescue of viable businesses might be jeopardised. For this reason, administration can also be entered when a company is likely to become unable to pay its debts, which was the focus of what my noble friend said.
The clauses on special administration in the Bill follow these principles. When seeking to bring an energy supply company administration to an end, the administrator’s primary objective will be to rescue the company as a going concern. Therefore, these provisions apply the same tests for insolvency as the Insolvency Act. My noble friend argued that the process is different. As he has already picked up, the Secretary of State and Ofgem will no doubt want to discuss with the company’s directors in advance any application for an energy supply company administration order. However, enshrining in the legislation a duty to consult directors could lead to delay. This is significant; the Secretary of State needs flexibility to act quickly if the company’s position poses a threat to the rest of the market. That is extremely important to remember in this case.
The amendment would require the court to apply a stricter test for insolvency when considering applications for energy supply company administration than it does for applications for ordinary administration. It is therefore conceivable that an application by the Secretary of State for an energy supply company administration order could be dismissed, while an application for ordinary administration by a creditor of the company could succeed. This could lead to the very situation that the provisions in the Bill are intended to address.
The fact that a court process is required provides an important safeguard for companies, as the directors of the company have the opportunity to contest the order in court. They will no doubt use the kind of material that my noble friend has just mentioned.
My noble friend mentioned Railtrack. In October 2001, the High Court granted a railway administration order in relation to Railtrack. When granting the administration order, Mr Justice Lightman said:
“This is clearly a case where the making of a railway administration order is not only appropriate, but absolutely essential”.
If my noble friend would like, I can fill him in at another time on the reason for that judgment being made. The company was put into administration to ensure that the railway network continued to operate and was properly maintained and managed, and that it was done in the public interest.
I make it absolutely clear that it is intended that the Secretary of State would apply for an energy supply company administration order only as a last resort and to prevent the risk of financial failure spreading to other companies. It is important to balance duties to the public with the rights of the companies. Energy supply is vital to the public and to the economy. It is therefore very important that this matter is looked at in the context of the public interest. The balance must be right. What we have seen recently in the banking industry, for example, shows how important it is to be very careful in this area.
I hope, therefore, that I have sufficiently reassured my noble friend and that he will now withdraw his amendment.
Lord Jenkin of Roding
I am extremely grateful to my noble friend Lady Northover for the care with which she has replied to this amendment. I have no doubt whatever that the industry will wish to study very carefully what she has just said. I have entirely accepted the case, and I think the industry accepts the case, that there is a need for the authorities to intervene. Our problem is that that might happen when the companies’ assets and liabilities appear to be in balance but someone has thought it unlikely that they will be unable to pay their debts in the future. This seems to me and to others to be an uncertain test. It would behove the Government to try to find some alternative form of words that would allay the undoubted feeling of insecurity and unnecessary risk that the companies are running under the process of the Bill.
However, as I made clear last week to my noble friend Lord Marland, it is not my intention to divide the House on this amendment but to make sure that the arguments are on the record and can be referred to in another place if that appears to Members of another place to be appropriate. Having said that, I beg leave to withdraw the amendment.
Lord Whitty
“Compensation where the Secretary of State requests termination of offshore lease or agreement to lease
(1) The Secretary of State shall make a scheme (in this section, an “early termination compensation scheme”) to have effect where—
(a) a lease granted or agreement to lease has been made by the Crown Estates for the purpose of construction and operation of a generating station powered by wind, wave or tidal energy, or of equipment for transmission of electricity at a site in United Kingdom territorial waters or the REZ;(b) that lease or agreement to lease gives the landlord power to determine the lease or agreement where the Secretary of State so requests on the basis that the whole site, or any part of it, is required in connection with oil or gas works or rights; and(c) the landlord proposes to determine the lease or agreement, as regards the whole site or any part of it, as a result of such a request.(2) An early termination compensation scheme—
(a) must require the owner of, or person seeking to exploit, the oil or gas works or rights in question to pay compensation to the full extent of the loss which is likely to be incurred including the recovery of any wasted expenditure, loss of profits and any consequential loss suffered as a result of such works, by the lessee or holder of the agreement to lease as a result of the determination;(b) may, subject to paragraph (a), make such provision as the Secretary of State considers appropriate for the computation of compensation;(c) must make provision for the procedure applicable to the making and determination of claims, including provision for resolution of matters, in the event of disagreement, by an independent body;(d) must provide for the Secretary of State, when satisfied that compensation as required by the scheme has been agreed or resolved, so to certify in writing; and(e) may contain such other provision as the Secretary of State considers appropriate.(3) The landlord must not determine the lease or agreement to lease until the Secretary of State has certified the determination in accordance with subsection (2)(d).
(4) Subsections (1), (2), (5), (6), (7)(b) and (10) of section 36 apply, with the necessary modifications, to an early termination compensation scheme.”
Lord Whitty
I put down a similar amendment at Report which we were unable to debate. I am grateful to the Minister and his staff for talking to my noble friend Lord Grantchester in my absence. That makes me more confident that the Government understand that there is still a problem.
The amendment relates to the situation where a renewable energy enterprise has invested, at least as far as getting a lease from the Crown Estate, in offshore wind energy—it could be tidal or wave energy—and subsequently there is an oil discovery which would interfere with that site. This could result in a direct conflict, so my original attempt was to ensure that the Secretary of State could prevent such an oil licence being given unless the two sides negotiated an agreement. However, the noble Baroness, Lady Northover, persuasively indicated that the Government have this in hand, that there are negotiations going on and that they are talking to the industries and trade associations. That is indeed true, but the problem is that they have been talking to those two sides for six years and as yet we have no agreement on how to deal with it.
It was clear from what Baroness Northover said that the Government would not be minded to provide for such an override. In my view, an override would restore the balance between the two sides, but nevertheless the Government were not prepared to go down that road. I have therefore reverted to my third choice. My first choice is to have an agreement, my second choice is that the Government should have the means to prevent the oil or gas development happening unless there was an agreement and my third choice is that, if the oil or gas development goes ahead, compensation should be paid. That should be set out in statute.
One of the reasons why I felt it necessary to return to this is that the noble Baroness, having made some reassuring noises, added another comment, which I did not pick up at the time in Committee, when she said that,
“if the oil company is not prepared to offer appropriate compensation, there is no question of the Secretary of State intervening to override what is happening there”.—[Official Report, 8 February 2011; col. GC52.]
I was not entirely sure what that meant, because it seems to me that where there is no agreement and the Secretary of State, having tried to get the two sides to reach an agreement, judges it to be in the public interest that the oil exploration goes ahead, there ought to be some compensation involved. It is important that we register this as an ongoing concern both for the offshore wind-energy companies and, potentially, for tidal and wave installations. Because the clause in the Crown Estate’s lease enables this to happen, some intervention by the state or through the contractual provisions is required to even up the balance between the two sides.
I recognise that this is a complex area and it would be better for all of us if the Government and the two sides could reach agreement, but six years without agreement does not give me huge confidence that we will solve this before the passage of the Bill through both Houses of Parliament. I therefore tabled the amendment to register that with the Government and possibly to persuade colleagues in another place that this is an important issue. If investment in offshore, wind and other renewable technologies could effectively be overridden by a new oil exploration taking place in a site that had already been allocated and for which a lease had been agreed, some compensation is required if we are to encourage investment.
What lies behind this is that making a major investment in offshore wind and other renewable technologies requires significant private capital. For the most part, that will need to be raised from the markets. Although some large companies are investing in alternative technologies, we are mostly looking at finance through the City or the markets in one way or another. As long as potential investors can see not only that an investment could in effect be lost but that there is no legislative provision for compensation, clearly that will deter investment. That is what the offshore wind companies claim and it seems a valid point on which public policy should clearly give an indication.
I hope therefore that the Government will recognise that the third-choice option of providing in statute for some form of compensation is probably the least they can do in the circumstances. I hope that they will accept the amendment. If they cannot do so today, perhaps a similar amendment could be moved in another place and they could accept that. I beg to move.
Lord Oxburgh
My Lords, the amendment certainly addresses an extremely important point. I conclude from the points made by the noble Lord, Lord Whitty, that the issue involves three separate elements: the Government's North Sea renewable strategy; investor confidence; and the behaviour of the Crown Estate. Unless the problem is addressed, we may be dealing with simply a matter of encouraging investment in the North Sea but of making it possible. Now is not a good time to raise money for renewables or anything else, and this could be the last straw when it comes to investment companies looking for where to put their money.
Anyone observing the behaviour of the Crown Estate in recent years cannot be anything other than impressed by the vigour with which it is pursuing the objectives that must have been imposed by its master the Treasury. To describe the Crown Estate as hard-nosed might be an understatement. Indeed, it does not have responsibility for delivering the Government’s renewable North Sea strategy. Without some clear statement, ideally in the form of a statutory instrument of some kind as suggested by the noble Lord, Lord Whitty, or some comparably sure investable assurance, we will not see this going ahead.
Baroness Parminter
I add our support for the noble Lord, Lord Whitty, in raising this important issue about creating a level playing field between the respective players in using the marine environment and the seabed. I also thank him for highlighting again, as he has done so eloquently in the past, the risk that not tackling this issue of the leases that can be rescinded by the Crown Estate will cause huge problems for future investment in renewable energy. While they may have taken six years to potter around on this issue, the Government know—as we in this House all know—that, if they are to meet their targets on renewable energy, this issue has to be resolved very quickly to get the future investment in renewable energy.
My slight concern with this amendment is that it seeks to draw out one particular problem out of the complex number of issues that make up the jigsaw of coexistence between the respective oil and gas companies and those involved in renewable energy. As RenewableUK said,
“efforts to work together to prevent problems are far more likely to succeed if a fair and clear framework for co-operation is established”.
While I support this amendment—because it is right to raise this important issue that leases can be rescinded—I am concerned that it draws out only one particular issue in the jigsaw. If we are to get an equitable solution that all parties can agree to, there is still merit in looking at all those issues together.
Therefore, if the Minister is not minded to accept this amendment, I and other Members of this House would be grateful to know that the ministerial team is working now, with all parties, to agree such a fair and clear framework for co-operation that covers all the issues, not just the—admittedly important—issues around the termination of leases. If that framework can be agreed, which I hope can be achieved during the passage of the Bill as it goes to another place and comes back, that would give Members in this House the confidence that the Government recognise this issue, which has been raised by both sides of the House. The present state of affairs, whereby the leases can be rescinded for offshore wind if oil and gas companies come ahead with proposals, is not satisfactory, will not deliver the Government’s objectives for renewable energy and does not create a level playing field.
Lord Grantchester
My Lords, it is important to promote the coexistence of UK oil and gas interests with offshore renewable energy expansion. We all want to maximise the growth of both sectors in the UK and thereby to enable the UK to benefit from sustainable electricity supply, strong oil and gas revenues and job creation in both sectors. As I understand it, there is an imbalance in the rights under the lease, according to whether the lease is in the hands of the oil and gas industry or the renewable wind industry. Where the oil and gas industry has an existing lease from the Crown Estate, the renewable industry can encroach on that territory only through commercial negotiation. Where the renewable industry has the lease, a clause in that lease gives the Secretary of State powers to terminate offshore wind-farm leases in favour of oil and gas and does not specify whether compensation would be due or how that amount would become due. This causes alarm in the renewable offshore wind industry that it could stifle investment in developing sites.
My noble friend brings forward his amendment to resolve the situation through the operation of a compensation scheme to cover the situation where the Secretary of State may be minded to terminate a lease in favour of the oil and gas industry. This scheme would give renewable developers the assurance that they feel they need to overcome reluctance to invest in developing a lease where it could be thought encroachment may happen from oil and gas operations. We understand there has never been—and, indeed, there is unlikely to be—such an occurrence. However, the renewable industry has the perception that the possibility of an early termination is detrimental to its financing and the exploitation of leases. This amendment seeks to end that uncertainty and uneasiness in the investor market.
I am sure the Minister would want to find a way to end the antagonism between the two key developers in the operation of leases. Can he give further assurances today, or even offer to facilitate a meeting with his department, so that the two protagonists could agree and cement a way forward?
Lord Marland
My Lords, I am very grateful to the noble Lord, Lord Whitty, for pointing out this particular area. We find ourselves perhaps in the crossfire between two interested bodies: RenewableUK and Oil & Gas UK, both of which are fighting for their own corners.
I am afraid I am attracted by the second option—I think it was the second option—to carry on the dialogue. We do not believe that the issue has been going on for six years, but I am very grateful for the historical information, which officials had not imparted to me. I think it is attractive for us to carry on the dialogue and, I might say, knock heads together, because it is important that we get these boundaries clearly defined. As the noble Lord, Lord Oxburgh, and the noble Baroness, Lady Parminter, both said, this is a complex thing that cannot be done quickly and needs negotiation. It needs both parties to come to the table to help us find the correct solution. The Government are immensely committed to it because it is important and therefore I am extremely grateful that this matter has been raised, but noble Lords have our assurance that we are pressing on with the negotiation. We intend to have a resolution, particularly as the renewables industry develops, as soon as possible, but we are in earnest.
I want to clarify something from Hansard that the noble Lord, Lord Whitty, said my noble friend Lady Northover said. Let me read out—another rare event for me—what the statement, in case he hears it incorrectly, should have said: I am happy to repeat the assurances we gave in Committee that where the oil company is not prepared to offer appropriate compensation, the Secretary of State will not intervene, on behalf of oil companies, and therefore the oil and gas development will not be permitted. I hope that clarifies that fundamental point.
With that, I hope the noble Lord will withdraw his amendment.
Lord Whitty
My Lords, I am very grateful to the Minister for clarifying that because that is not the way the original Hansard report read. As I say, I did not pick that up in Committee itself but only subsequently.
I think we all agree that we need diversity of supply and that we need oil and gas and offshore wind as a part of our energy mix. We also have a public policy objective of a certain level of renewables to which offshore wind will be the major contributor. Therefore there is another incentive for Government to get this right. Clearly, a general coexistence and co-operation agreement between the two sides would be highly desirable, and I am certainly happy to support the Government’s attempts to get that. I think he will find that this has been on the agenda for some considerable time. It might be five years and not six, but I think it is six years since I was a Minister and it was on the agenda within the former DTI, which sought comments from my department, which was Defra. So it has gone back that far. It may not have been a continuous negotiation, but the issue needs facing up to.
The renewables industry certainly feels, particularly in the present tight market, as the noble Lord, Lord Oxburgh, indicated, that this is a serious deterrent to getting the kind of funds needed to deliver what are, after all, the Government’s own objectives. He is certainly also right that—let us put it kindly—the nature of the legal advice that the Crown Estate appears to be getting does not help the situation either. It is a complex issue.
I am happy for today to accept the Minister’s assurance that we will continue to try to get an agreement. I suspect that the timescale of this Bill is not sufficient to get this agreement and the Government at some stage of the process may well consider they need a little bit of leverage here and may come back to something like this agreement. However, for today I withdraw the amendment.
Fixed-term Parliaments Bill
(13 years, 1 month ago)
Lords ChamberRead Full debate Read Hansard Text Read Debate Ministerial Extracts
Lord Howarth of Newport
“( ) The polling days for the next parliamentary general election after the passing of this Act will be the weekend of 8 to 10 May 2015.”
Lord Howarth of Newport
I wonder if I may be permitted to make a general point, briefly, as we move into Committee, before I come to the specific matter of Amendment 1. I tabled this and other amendments after I had seen last Thursday that only eight amendments had been tabled to this Bill in Committee. I began to be worried that we might not conduct a proper scrutiny of the Bill in Committee—the very opposite hazard to that which we faced with the previous major constitutional Bill, the Parliamentary Voting System and Constituencies Bill. I have tabled rather a lot of amendments, but I assure the House that neither I nor my colleagues intend to mount a filibuster on this Bill—nor did we on the previous Bill. We tabled some dozens of amendments, but that was very modest indeed compared for example to the opposition parties in the Assemblée nationale de France in 2006, when in opposition to the Government’s measure to reduce the state’s shareholding in Gaz de France they tabled 137,449 amendments. That was a real filibuster. Noble Lords will also be aware that the earliest recorded instance of the practice of the filibuster was on the part of Cato the Younger, who talked out proceedings in the Roman senate because he believed that it was important to resist the ambitions of Julius Caesar, flushed with victory, to flout the conventions of the Roman republic. Of course, for Julius Caesar read Nicholas Clegg—and our task has been to resist the Caesarism of Mr Nicholas Clegg.
In all seriousness, I believe that the point at issue in our proceedings on the Parliamentary Voting System and Constituencies Bill, aside from the particular contents of that legislation, was the continuing ability of this House to perform its role as a revising Chamber. Proceeding in a fashion whereby legislation is scrutinised on all sides of the House, we move things forward on the basis of reasoned debate and the Government listen and accept well made arguments, particularly when supported by majority opinion in this House. But I am encouraged because I need not have feared last Thursday that there would not be enough amendments. Happily, Liberal Democrat and Conservative Lords have tabled considerable numbers of amendments. They have awakened from their long slumber during the Parliamentary Voting System and Constituencies Bill. The noble Lord, Lord Rennard, looks deprecatingly at me, and if he will let me finish my sentence I shall give way to him. It is certainly the case that we heard him sleep-talking and occasionally we heard the noble Lord, Lord Tyler, groan. But in the main, there was a very disappointing lack of participation from noble Lords on the other side of the House on that Bill.
Lord Rennard
My Lords, very briefly, I say that the noble Lord did perhaps invite us to slumber on a number of occasions in the course of that Bill. However, having studied the recent precedence of filibustering in the French Assembly, he must have been unaware of those precedents at the time of the passage of that Act.
Lord Howarth of Newport
The noble Lord, Lord Rennard, makes an excellent point. However, I am optimistic because we are about to resume proper scrutiny in your Lordships’ House.
Lord Tyler
The noble Lord referred to slumbering Members on this side of the House. There is photographic evidence that the only people who actually went to sleep were people listening to his speech on his side of the House.
Lord Howarth of Newport
On the contrary, I myself went to sleep, but not during my own speeches—although I might have done, and indeed the noble Lord might have supposed that I had done. I concede that at certain points.
We are about to resume a proper practice of scrutiny in the best traditions of your Lordships’ House. It is particularly important given that there was no Green Paper heralding this legislation, there has been no pre-legislative scrutiny, yet this Bill is of very great constitutional importance in itself and its provisions interact with other constitutional measures. For example, they interact with the provisions for boundary reviews that we just legislated in the Parliamentary Voting System and Constituencies Act. They interact with provisions that we can anticipate in a draft measure for reform of your Lordships’ House. They interact with the contents that we can anticipate of a draft parliamentary privileges Bill, which we are led to expect. I think that it would have been better if the Government’s proposals in all these respects had been laid out and available for pre-legislative scrutiny rather than that Parliament was required, effectively, to legislate on aspects of the constitution without having the ability to consider the interplay between different reforming measures. However, I am encouraged by what the Deputy Prime Minister said in the Constitution Committee of your Lordships’ House on 13 October last year in responding to the noble Lord, Lord Pannick:
“Of course, what matters now is the degree of scrutiny that”,
the Fixed-term Parliaments Bill,
“is subject to as the legislation passes through both Houses. On that we are very clear. We want to make sure that it is subject to the greatest possible scrutiny, which it rightly deserves”.
In that spirit, I beg to move Amendment 1 in my name.
The Bill, as drafted, prescribes polling at general elections on a Thursday. It ignores the debate about the case for polling at weekends or other ways in which polling can be facilitated for our citizens. It effectively closes down that debate, which has been proceeding somewhat desultorily for a number of years. However, it is a proper debate and I do not think that it should be instantly closed down. We all have a major concern about how to improve participation in elections in this country. I am indebted to the Library of the House of Commons for a chart that it has provided in one of its notes, which shows a tendency for turnout at general elections to have declined significantly between 1950 and 2010. The bar chart indicates that in 1950 turnout in the general election of that year was of the order of 83 per cent. It fell a little bit at subsequent elections, but in February 1974 it was at or very close to 80 per cent, which is remarkable. Of course, the country was in crisis at that time and it was perceived to be an exceptionally important election. Nevertheless, looking back from where we are now, we would regard it as quite remarkable that turnout was 80 per cent in February weather conditions in 1974.
Lord Cormack
Would the noble Lord recollect that in the election of 1974 there were very few postal votes cast? People actually made their way in inclement weather to the polls because they felt strongly about the issues. Have we not made voting too easy with too many postal votes allowed, and does that not relate to the falling off in the percentage poll that we have seen in recent years?
Lord Howarth of Newport
The noble Lord, Lord Cormack, raises an important point. It was the more remarkable that there should have been an 80 per cent turnout in February 1974, given that it was not an easy thing to secure a postal vote in those days. I wonder whether the ready availability of postal votes in more recent elections has contributed to a decline in participation. It is not immediately obvious to me why that should be so but the noble Lord may have something to say about this a little later. Whatever may be the truth there, what we have seen in elections subsequent to that of February 1974 has been a pretty dismal trend of declining participation in general elections, reaching a low point in the 2001 election, where I think it was probably under 60 per cent, and rising slightly since then so that in the 2010 general election the turnout was 65.1 per cent. All of us must worry about the implications of that.
All sorts of explanations are offered for declining participation: dissolving class structures, since people in this country do not so completely identify themselves with the two major political parties; more fluid communities, in a whole variety of senses; rising affluence over the post-war period, so that people perhaps feel a less burning need to secure what they can from politics; the privatisation of economic and social responsibility; the dousing of politics in contempt by the media; the rise of celebrity culture; and the perception on the part of very many people that casting their vote will make no difference. General elections are seen to be determined in a relatively small number of marginal seats. There is the view, which a number of us have perhaps heard on the doorstep: “They’re all as bad as each other”—a poor opinion of politicians and politics. There is perhaps also a view that compared to what may have been the case in the past, British Governments are now rather powerless, whether at home or abroad. I do not know but those are among the explanations that have been offered.
There is one explanation which is germane to this Bill and which the Government ought to take seriously: that voting arrangements are inconvenient. There is the requirement to turn up to vote—you can get a postal vote, as the noble Lord reminded us but the normal practice is still for people to turn up and vote in person—on a Thursday within certain hours. There have been experiments in trying to facilitate participation in elections. There has been an extension of postal voting and there have been trial schemes for advance voting in supervised polling stations, so that people could cast their vote ahead of the formal polling day. Thought has been given to whether people should be able to vote in supermarkets and so forth. Most significantly, it has been proposed that polling should be shifted from the conventional, traditional Thursday to weekends when it can be supposed that it would be much easier for more people to make it to the polling booth.
We had a note from the Electoral Commission, which came in only late this morning. Admittedly, it had not had very long to prepare its briefing but it is always helpful if people who want to advise us can get their briefing in to us a little earlier than that. It comments on Amendment 1:
“While the Commission is not in principle opposed to polling day being moved to the weekend, we have stressed that any such change should only be made if there is clear evidence that it would be of significant benefit to electors. At present, we do not believe that there is sufficient evidence on which to reach a definitive conclusion”.
That must be an entirely sensible point of view. In the absence of sufficient evidence, it would not be sensible to make that change but the question is whether more evidence might be obtainable and whether it should be considered by the Government before they legislate, as proposed in the Bill, to establish definitively and for ever and a day that polling will take place on Thursdays.
The note from the Electoral Commission goes on:
“The Commission has … evaluated a number of local pilot schemes involving advance voting—where electors would be able to vote in a supervised polling station within their local electoral area between one and seven days before the principal polling day—and has concluded that such facilities could help to enhance the accessibility and convenience of the electoral process. We have called on the Government to consider introducing advance voting as part of a comprehensive electoral modernisation strategy”.
Have the Government considered the experience of this pilot scheme and are they thinking, as the Electoral Commission would have them do, about a comprehensive electoral modernisation strategy? Did Ministers consider whether it would be appropriate to allow voters the opportunity to vote at weekends instead of on a Thursday before they wrote Thursdays into the Bill? If they did not do so before they published the Bill, will they now consider it?
Lord Rennard
I support Amendment 2 and the amendments in my name and the names of my noble friends Lord Marks and Lord Tyler.
Many noble Lords will know that I have long been an advocate of voting at weekends. They will also know how frustrated I feel that, among the many models piloted by the previous Labour Government to try to explore different ways of increasing turnout in local elections, only one pilot of weekend voting was ever undertaken—in one place, at one weekend—and that was of limited value. The idea of voting at weekends is not new; it has been floated and discussed in some form, but never properly debated in Parliament in such a way as to enable Parliament to decide the issue.
The Home Affairs Select Committee considered the issue in 1997; a Home Office working party looked at it in 1999; it was the subject of some limited debate when we permitted pilots as a result of the Representation of the People Act in 2000; the then Office of the Deputy Prime Minister further considered the matter in a consultation paper in 2002; the then new Electoral Commission published a report on election timetables in June 2003 and again in 2007; that year, weekend voting was again floated as part of the Government’s Governance of Britain Green Paper; and a separate consultation paper was then published specifically on this issue in 2008. That was supposed to feed into a citizens’ summit, which would recommend whether or not to go ahead with weekend voting later in 2008. That summit never happened. We have never had a proper debate in Parliament to determine the issue.
The principle of weekend voting is simple: more people are at home and free to vote for more of the day at a weekend than they are on a weekday. One possibility is to give people two days over the weekend on which to vote. This would avoid potential problems with religious observance and give people more than twice as much opportunity to participate. Many noble Lords have participated in elections and those who have campaigned will know the frustration of trying to contact voters among the working population of a constituency, in the few hours before the polls close at 10 pm, in order to remind them to vote. They will also have had extensive experience of trudging the streets during the day on polling day and vainly knocking on the doors of people who are out at work. We try to encourage them to vote but know that they cannot.
All those involved in elections know that people who are contacted on polling day and reminded by parties to vote are significantly more likely to vote than those who are not. It stands to reason that if people are contacted during the weekend when they are at home and reminded to vote, they are significantly more likely to participate. All good democrats should agree that increasing participation in elections is a good thing, especially as turnout has declined in many recent elections.
Lord Grocott
I know that the noble Lord favours different electoral systems and is passionate about increased participation in elections. Does he acknowledge that there is no evidence whatever in this country that changing an electoral system increases participation? In fact, we know that the various election systems that he supports lead to far more spoilt ballot papers, which, surely, is a further illustration of weakening participation in elections.
Lord Rennard
My Lords, I anticipated that it would not be long before the noble Lord, Lord Grocott, found an opportunity to digress from the issue of participation in elections at weekends and encouraging people to participate. It is a source of regret to me, if not to many others, that the debate the noble Lord proposed to have about the relative turnout resulting from different electoral systems was not held in this House. Of course, he tends to compare declining turnout in European elections with declining turnout in general elections. The truth is that turnout is declining in many levels of elections, particularly in European elections. People may see the European Parliament as even more remote and they make a protest by spoiling their ballot paper. We have to recognise that. But if the noble Lord wishes to study the evidence on this properly and looks at the preference vote using the 1,2,3 system, he will see that in the Scottish local elections in 2007, notwithstanding the fact that there were other elections for the Scottish Parliament on the same day which used a different proportional system, there were very few spoilt ballot papers.
The principle of weekend voting deserves serious and considered debate. It is most unfortunate that the Bill as it stands enshrines Thursday as the day on which general elections should be held, even though that is an accidental precedent. It is not widely known that there is no statutory basis at present for polling day to be on a Thursday; indeed, many council by-elections are held on a Wednesday or a Tuesday when, for some good reason, they cannot be held on a Thursday.
We should think about voting on a Saturday or a Sunday or a Saturday and a Sunday. Our amendments provide the Government with what some noble Lords will now understand as being a Lord Rooker-type famous lifeboat. They do not actually say that things should change; they merely invite the Government to consider the possibility of a change on the assumption that there could be proper consultation, perhaps piloting and serious debate, and then the decision can be made at a later point. We can look at the arguments and consider them properly but because, as I said earlier, the issue has simply been allowed to drift so often, our amendments set a deadline for determination of the issue. That deadline is, sensibly, 1 October 2013, which coincides with the deadline for the publication of reports by the Boundary Commissions.
I hope very much, therefore, that the Government will keep an open mind on weekend voting. If there is a clear promise that we will consider this issue properly in due course and that Parliament will be allowed to decide whether voting should in some form be taking place at weekends rather than on a Thursday, I will not seek to press my amendments. But if there is no such indication, I would, at the very least, not want to see the Bill pass with people thinking that Thursday 7 May 2015 is already fixed in stone as polling day for the next general election.
Lord Pannick
Before the noble Lord sits down, does he accept that to mandate Saturday as the exclusive day for voting would effectively disfranchise Orthodox Jews? There may also be difficulties about observant members of the Christian community who would not wish to vote on a Sunday. Therefore, does the noble Lord accept that if there is to be weekend voting, it would have to be over the whole of the weekend?
Lord Rennard
The noble Lord, Lord Pannick, makes a very good point, which I made when we discussed the issue in general without being able to decide the precise terms. I have always thought that weekends are probably better for voting than weekdays. I accept that it would be a problem in principle if some people felt that either Saturday or Sunday was an objectionable day when it came to them going out to vote. It would be rather good to say that a Saturday or a Sunday could be polling day—that is, two days. However, the hours could be more limited, as I do not think that polling would need to last from 7 am until 10 pm. I think that this should be the subject of proper debate and scrutiny. It may be that polling hours of 9 am to 6 pm will be very suitable on a Saturday and Sunday. The only objection to this that has been raised in the past is rather absurd and it has come from the electoral administrators. They said that there would be problems with security at the ballot boxes over a Saturday night into a Sunday. However, in the European elections we vote on a Thursday. The ballot boxes are sealed on the Thursday night and counted on the Sunday evening. Therefore, I do not believe that that is a significant problem. Indeed, I believe that many people who work in the electoral administration process would welcome the opportunity to work on a Saturday or a Sunday.
Lady Saltoun of Abernethy
My Lords, I do not know but I would not be at all surprised if it turned out that people much preferred to vote on a weekday, possibly taking a bit of time off work or arriving later for work, than have their football or whatever interfered with on a Saturday or a Sunday.
Lord Rennard
My Lords, few football matches last for nine hours on a Saturday and nine hours on a Sunday. I think that there would be plenty of opportunity to vote over a weekend. Some people may be in the privileged position of being able to take time off work on polling day but I do not think that many employers would take kindly to people saying, “I’d rather go and vote than work for you”. I think that that is why so few people among the working-age population vote and why a disproportionate number of retired people vote in elections compared with those of a working age.
Lord Cormack
My Lords, the noble Lords, Lord Howarth and Lord Rennard, have performed a very real service to the Committee in enabling us to debate this issue. When the noble Lord, Lord Howarth, referred to the Electoral Commission and those dreadful words “modernisation” and “strategy”, I began to have my doubts but, seriously, it is important that we look at this issue. The noble Lord, Lord Pannick, raised an extremely important point when he talked about Orthodox Jews and many Christians.
I also think that there is a great deal to be said for having “a” polling day. I have always felt that having one day for elections and encouraging people to go to the polls is what it is all about. That is why I have viewed with a degree of concern, as well as scepticism, the increase in the incidence of postal votes. I referred to this briefly in my intervention during the noble Lord’s speech. Of course, it is right that people who are incapacitated in any way or whose jobs regularly take them away from home should have postal votes. I was also very much in favour of people who had booked a holiday being allowed to have a postal vote.
I fought every general election from 1964 to 2005— 12 in all, in 10 of which I am glad to say I was successful. I campaigned in many other elections beginning in 1959. Therefore, I think that I have some experience. I remember vividly the election on 28 February 1974, to which the noble Lord, Lord Howarth, referred, when almost 80 per cent of the electorate went to the polls. People were exceptionally concerned about the gravity of the economic crisis. Many of them felt, as I did, that Edward Heath had abdicated in asking “Who governs the country?”. The answer of course is that the Government govern the country and it is the Prime Minister’s job to lead that Government. I felt—and said at the time—that he was wrong to go to the country. Indeed, he discovered that that was not the best decision of his life.
However, people turned out. I think that people will turn out as long as there is a proper incentive for them to do so and as long as it is not made too easy. That may sound paradoxical, but I think that the introduction of postal votes on demand, which in effect is what exists at the moment, does not encourage people or focus their minds or attention on a specific day.
Lord Howarth of Newport
Since we had our earlier exchange on this subject, I have been reminded that participation is actually higher among people with postal votes. It is over 70 per cent at general elections and not much lower at local elections. That suggests that the ease with which people can have a postal vote and thereby cast their vote is not quite as debilitating as the noble Lord fears.
Lord Cormack
I obviously listened carefully to what the noble Lord said, but there have been some disturbing accounts of the way in which postal voting has been conducted, and he knows that as well as I do. The security of the postal vote does not begin to compare with the security of the personally cast ballot. I am glad to see him nodding assent at that.
When it comes to the day, for the reasons that I indicated earlier, I have great sympathy with the noble Lord, Lord Pannick, and I see no need to depart from Thursday. It is good that we should discuss it and maybe consider experiments with more local elections. I would not be averse to that. However, I believe that Thursday is tried and tested for general elections, and I hope that the Government will stick to that, certainly for the foreseeable future as foreseen in the Bill. I very much hope that they will consider the issue of postal votes and how postal voting is conducted and made more secure. It is important for the House to look at this and for another place to have another chance to look at it. Obviously, it would be quite wrong to press any of the amendments to a Division today, but I hope the Minister will be able to tell us that the Government have taken on board the points that have been made and will truly reflect on them.
Lord Bach
I hope that the Committee will forgive me if I speak from the opposition Front Bench at this stage. I am not for a moment trying to shorten the debate. It is a very important subject and the noble Lord, Lord Rennard, among others, has waited for years for a proper debate on this topic. The last thing I want to do is to stop that debate. The Minister knows, and I have told the Committee, that I have some personal difficulties that require me to leave in fairly short order. I hope that the Committee will forgive me if on this occasion I put the view of the opposition Front Bench very briefly and then leave. Of course the opposition Front Bench will be filled very adequately in my absence.
I say briefly that the Committee should be very grateful for the two opening speeches in this debate—the introduction from my noble friend Lord Howarth and the comments of the noble Lord, Lord Rennard, about weekend voting. At the very least it is necessary for the Government to think very carefully about the advantages—and the disadvantages, which the noble Lords, Lord Cormack and Lord Pannick, have hinted at—of changing from Thursday voting to weekend voting. It is an issue that ought to have been debated in Parliament a long time ago; I agree with the noble Lord, Lord Rennard, exactly about that. It was particularly interesting, sitting where we sit, to hear the language used by the noble Lord, Lord Rennard, in the sense that he was looking not just for a debate that would end in a few fine words but for some kind of decision on this issue. If I heard him right, he thought that this was the appropriate Bill for such an issue to be finally resolved under. Am I wrong about that?
Lord Rennard
For clarification, I was not necessarily suggesting that this Bill should determine the issue but that, if we were assured that it would not close this issue and that we would properly and seriously consider the issue in Parliament in due time before 2015, I would not necessarily want to press the amendments at this stage.
Lord Bach
I understand what the noble Lord has said. He mentioned the magic date of 1 October 2013. My advice to him, if I dare give advice to someone so expert in this field, would be just to beware the words that you hear from the Government when they have had time to consider this issue, even though they will be honeyed by the tones that the noble and learned Lord, Lord Wallace of Tankerness, will undoubtedly use both today and when the matter is raised again on Report. The noble Lord will be promised the earth but I am not sure that there will be any delivery within the timescale that he is looking for.
It seems to us an attractive idea in principle that we should consider very carefully whether weekend voting is more appropriate and will lead to greater turnout. I do not think that we should assume that it necessarily will. There are people who would not dream of voting at weekends who will vote on a weekday, but I think that more people will be more tempted to vote if they are given a period, such as some part of Saturday and some part of Sunday, to do so. This is a very important issue not just for turnout but for other issues around British elections. The Opposition wish these amendments well. We hope that the debate continues, and we look forward to playing a full part in it.
Lord Tyler
I am very glad that the noble Lord, Lord Bach, preceded me because it gives me an opportunity to congratulate yet another sinner on repenting when I hear from him the admission that Ministers occasionally give us honeyed words and assure us that action will be taken when, in the 13 years in which he had a very responsible role in government, there was very little action even in discussing this issue, let alone consulting on it.
I shall make two or three quick points in support of the amendments that my noble friend Lord Marks and I have tabled. First, I recall very well indeed the night of 28 February 1974. In an enormous, scattered rural constituency with snow threatened, pouring rain much of the time and a lot of wind on Bodmin moor, we managed a turnout of 83 per cent, but that was in extremely difficult circumstances. This is true of many rural consistencies in which there are big distances to travel from the place of work to get to vote. There are very difficult circumstances in many villages when the only place where you can have a polling station is the village school, so it is closed for the day. That practical point has not yet come up in the debate. It may be true in urban areas too, but I do not have the same experience. There are practical problems about the insistence on Thursday as polling day that we should address.
The other point that I shall address very briefly was raised by the noble Lord, Lord Pannick, and supported by my noble friend Lord Cormack. I am a practising member of the Church of England, by which I mean that I am never going to be perfect but am practising all the time. I recognise that there are people in all the churches who would find it difficult if Sunday were the only day. That is why our amendments specifically refer to the possibility of two days. Of course, it is also true that Saturday is a day for other faiths, as indeed is Friday.
I am chair of the Faith and Civil Society Unit at Goldsmiths College, so I take a particular interest in the way in which we are now a multifaith community. We should recognise that in the way in which we address this issue. That is why I am very strongly of the view, as my noble friend Lord Rennard said, that it would be preferable to have the choice of two days, but they should be shorter days. I also recall that on 28 February 1974 one presiding officer was so exhausted by the end of the day that he did not properly perforate the ballot papers. Since I ended up with a majority of nine after six recounts, I think that the long day is another factor that we should take into account, and a shorter working day but on both days seems to be something that we should look at very carefully.
I have some sympathy with the point made by the noble Lord, Lord Cormack, about the insistence on moving towards more and more absent voting, both proxy voting and postal voting. On balance, it is preferable to try to extend voting in person and to make that as easy as we can, not just for reasons of potential corruption and fraud but because it is part of one’s civil responsibility to come together as a community to vote. I hope that is true.
The noble Lord, Lord Howarth, referred to the briefing by the Electoral Commission, and I should say en passant that I am a member of the informal advisory group of politicians of all parties who give guidance to the commission every so often. Its summary is in effect that at this stage it would be premature to insist on moving towards weekend voting, which is really why my noble friends and I have put it not in a prescriptive way but in an advisory way that we should be moving in that direction. It is disappointing that although there have been pilots for so many other aspects of improving access to the voting process, there has been so little attention to or consultation on this issue. Incidentally, I endorse the point made by the commission about the number of advantages in advance voting. This is not an either/or. They are both quite useful ways in which we could get more people to go to the poll to cast their votes.
There is an interesting opportunity here. I hope that my noble friend the Minister will at least be able to indicate that he will not adopt the attitude of the previous Government, which was personalised, illustrated and characterised by the noble Lord, Lord Bach, in his honeyed words but with mighty little action. Before we get to the definitive moment to which my noble friend referred when we will know the shape of the new constituencies in October 2013, I hope that more work will have been done to consult all interested parties and to conduct pilot schemes to see whether a two-day weekend polling period with shorter hours each day would not suit our fellow citizens much better than plumping again for a Thursday, which is so inconvenient for so many and causes so much disruption.
Lord Grocott
My Lords, I echo what my noble friend Lord Howarth has said about how much better debates on major constitutional reform are when we get contributions from all parts of the House, which has characterised the debate on this amendment. I welcome the fact that we have had the opportunity to discuss this amendment even though I have real anxieties about it. Perhaps it is a sign of a simple mind, but one of the tests I put to constitutions is the extent to which they are straightforward, intelligible and as simple as possible, which is one of the many reasons why I am so strongly in favour of first past the post.
While I do not doubt for a minute the good intentions of people who think that we should have a couple of days to vote, there would be a problem. It would just extend the development, which has undoubtedly occurred in most of our lifetimes—I do not want to be rude in characterising it in this way—towards a kind of rolling election as opposed to an election day when the nation makes a decision. In part, a rolling election is very much as the noble Lord, Lord Cormack, has said. I know that under a Labour Government there was substantial development of postal voting. In effect, we have at least two election days, if not a longer period. There is the crucial day when the postal ballots go out and people react to that. Then there are the days between the postal ballots and the election day when more ballots come in, which makes it a kind of rolling election.
I feel a certain nervousness about extending the election over two days. At least it might mean that a lot of the drama will undoubtedly be removed from election day. Perhaps I am wishing for days that have passed to think that that drama can ever come back. The February 1974 election was certainly profoundly dramatic for me because it was one of the many elections that I managed to lose and there were several recounts into the middle of the night. We were pretty tired over that period, but that is part of the drama of an election night.
What would happen between the two polling days? Perhaps we would all sit in limbo. Again, I am trying to avoid crudely partisan points, but occasionally I cannot manage that. A rolling election period would be made worse by more complicated election systems. I genuinely respect the noble Lord, Lord Rennard, who has participated throughout. If the AV vote is passed, it will inevitably mean that counting will occur on the day after. It is inconceivable that an AV vote could be counted through the night of an election day.
Lord Rennard
One of the attractions of voting on a Saturday and a Sunday, between the hours of, say, 9 am and 6 pm, would be that the counts would begin at 6 pm on Sunday. Before the last general election, there was great controversy in the other place about when counts might take place and great concern that many of them would take place on the Friday rather than the Thursday. The Electoral Commission was greatly concerned about the accuracy of the counting by people who had been involved in the process from setting up the polling stations for 7 am to finishing at 10 pm and then counting the vote sometimes through to 4 am or 6 am on the next morning. It seems much more sensible for voting to take place during normal hours on a Saturday and Sunday and for votes to be counted on a Sunday evening. The noble Lord says that he personally did not like the February 1974 election results. I wonder whether he would prefer the system of 100 years earlier when a general election took place on different days in different constituencies all over the country.
Lord Grocott
That rather proves my point. I like the simplicity of polling day being polling day. We all know the beginning and the end, that the election programme will be on the BBC and that we will get an instant polling verdict on “News at Ten”. Are these bad things? I believe they increase the drama of an election and you need some drama in politics. It cannot be reduced to a dull procedural convenience. I do not doubt for a moment, as I have said, the motives of people who wanted more postal votes. There were many in my party who did and my Government facilitated it. It was done with good intentions but the outcome of what I can only describe as a rolling election has not been a good one. Likewise, I do not think the idea of having more than one polling day would be a good one. The noble Lord, Lord Rennard, says it makes people very tired so that they cannot cope and might make mistakes. However, our elections are amazingly free of challenges once the results have been declared. I have lost some elections and won one after a recount but people accept the results and rarely contest them.
My final concern is that, if elections are to result in more hung Parliaments—I doubt that they would under the first past the post system, as some claim, but they certainly would under a more proportional electoral system—the period between people first starting to think about an election and casting their postal vote will be prolonged and the country could reach a verdict weeks afterwards. So I recognise the motives behind these proposals but it is easy to have good intentions but bad outcomes. We have elections relatively rarely, and we will have them even more rarely if the Government have their way with this Bill. They ought to be dramatic days and I fear that these amendments would make them less dramatic and certainly less decisive.
Lord Newton of Braintree
My Lords, it is more or less fatal for me to come into the House because somebody always presses a button that leads me to get to my feet. In this case, it is all this nostalgia about February 1974, which is the date on which I was first elected. My memory of it is that it took a very long time because Braintree did not count during the night; it only counted the following day. After a nervous, sleepless night, I came in with a relatively small majority at about the same time as the Western Isles.
I have a lot of sympathy with the points made by the noble Lord, Lord Pannick. I would not support these amendments if they were pushed, but consideration of change should not be ruled out. I make three points in support of that. First, on the point made by the noble Lord, Lord Cormack, most of the criticisms of abuse or problems connected with postal votes seem to relate at least as much to people who have had them for years as to new postal voters. Secondly, like many people here, I live in London during the week and at my home in Essex during the weekends, so I now have a permanent postal vote for everything except parliamentary elections, which I cannot vote in anyway, because I never know where I am going to be.
The third point picks up that made by the noble Lord, Lord Howarth, about the greater use of postal votes and non-postal votes—if I may oversimplify what he said. A key strategic problem is the decline during the past 20 or 30 years in the number of people who vote at all. During most of my time in the other place, the turnout was never less than 75 per cent. It was several times more than 80 per cent, and I had villages in my constituency where the vote went over 90 per cent. In the previous two elections, we have been down to percentages which we used to associate with American elections—between 60 and 70 per cent. Therefore, the key problem here is getting the vote up. We should be willing to consider anything which could be shown to contribute to that.
Baroness Golding
My Lords, I was an election agent for some 15 years, so I do not think that there is very much that I have not seen. I have dealt with four elections—parish, county, district and general elections—all on the same day and all over a big area, and have learnt much through practice. Does the amendment refer just to a general election? Will all other elections follow suit? If we have a general election at a weekend, is it being proposed that county and parish elections take place then as well? Or will they be on a different day?
Lord Pannick
My Lords, the noble Lord, Lord Rennard, in answer to my intervention, accepted that if there is to be weekend voting it would need to be over the whole two days of the weekend, albeit during shorter periods on each day. There are difficulties about that, not just the loss of drama to which the noble Lord, Lord Grocott, referred. The difficulties arise from the fact that one day of voting involves all the electorate, with the exception of those who are postal voters, voting on the same factual premise. It is a snapshot of opinion at a particular time. Broadcasters are prevented from broadcasting any material during that day which would be politically partisan. That is entirely acceptable and workable. All that becomes much more difficult if the period of voting extends over two days. What happens if an event of considerable political significance—it may be a foreign policy issue or a terrorist attack—occurs during the first day of polling? The danger is that one can envisage circumstances in which the electorate who vote on the second day would be voting on a set of facts that would be materially different from those on which the electorate voted on the first day.
Lord Newton of Braintree
The noble Lord refers to certain instances, including a terrorist attack. Such an event could occur in the middle of polling day, in which case there would be a completely different mood among those who had voted early and the very large number of people who vote going home from work. I do not think that even a single day of voting avoids that risk.
Lord Pannick
The noble Lord is of course correct, but it is much less likely that the electorate who vote during a single day will be aware of or affected by a major news event during that day than if the event occurs during that day and there is second day of voting. This seems to be at the very least a factor that should be taken into account if consideration is being given to two days of voting.
The Advocate-General for Scotland (Lord Wallace of Tankerness)
My Lords, I thank the noble Lord, Lord Howarth, and my noble friend Lord Rennard for introducing these amendments. I say in respect not just of the amendment of the noble Lord, Lord Howarth, but of a series of amendments as we go through the Bill that it is important that there will proper scrutiny. The amendments that have been tabled already indicate that although the Bill is relatively short it is important, and that most if not all its key components will be addressed. We look forward to those debates.
I think that there is a consensus across the Chamber, as I think there was on a number of occasions—although it was sometimes difficult to believe it—during the passage of the Parliamentary Voting System and Constituencies Bill, that it is important that we try to look at ways in which we can increase turnout and participation in elections. No matter which party we belong to, or even if we belong to none at all, I think that we recognise the importance of trying to increase turnout.
It is probably fair to say—no doubt those opposite will correct me if I am wrong, because they were in government and responsible for introducing them—that the greater availability of postal votes is more a response to decreasing turnouts than a contributory factor as my noble friend Lord Cormack suggested. It is also fair to raise concerns, as has been done, about the security of postal voting, but it should be recorded that measures have been introduced during the past couple of years to ensure that postal votes are properly verified. Some of the debate which has taken place in recent days and weeks about the timing of the counts for the Scottish Parliamentary and Welsh Assembly elections in May has been coloured by the fact that returning officers are now very conscious of the time that will quite properly be taken in verifying postal votes.
My noble friend Lord Rennard indicated that this issue has never been properly debated in Parliament; I hope that he feels that it has had a reasonable airing today. It is clear from the contributions that have been made that there are arguments both for and against moving the polling day from the traditional Thursday to another day and, as the amendments would foreshadow, to weekends. There has been debate, too, on the cases for and against the holding of elections on more than one day. The noble Lord, Lord Pannick, said that if one was to have polling day on a Saturday it would raise religious issues for some faiths. Equally, I can think of places, not least in my native Scotland, where if voting was only on a Sunday there would be difficulties. That led noble Lords to consider the possibility of voting over two days. The noble Lord, Lord Pannick, indicated some of the practical issues to which that would give rise. I do not think for a moment that they are insuperable, but they would certainly have to be addressed if we were to hold elections on more than one day.
A number of issues have been raised. The previous Government instigated a significant test of opinion, by way of a consultation held in 2008, on the very subject of moving elections to weekends. The consultation sought views from a range of groups on whether elections should be moved from the traditional Thursday to one or both days of the weekend and whether this would improve access and opportunity for voting. There were diverging views on this issue. While it is fair to say that there was a balance of opinion in favour among members of public who responded to the consultation, the majority of respondents did not favour a move to weekend voting.
It is not obvious from that survey, which was published in March of last year, that such a move would make it easier for electors to vote. As the noble Lord, Lord Howarth, pointed out, there is nothing in statute that says that polling day should be a Thursday. I am sufficiently old, and enough of a political anorak, to remember a lot of local elections taking place on every day of the week. I think that I am correct in recalling during one of our debates on the Parliamentary Voting System and Constituencies Bill someone on the opposition Benches saying that they were once a candidate, or an agent, in a local election that had taken place on Saturday.
Baroness Armstrong of Hill Top
In the Local Government Bill in 1998, we made provision for significant pilots to take place on this and on different ways of increasing participation. It may be useful to the Minister and others interested in this amendment to look at some of those. The first organisation to do this in depth was Watford Council, which led to the Liberals taking over—so I was not too popular.
Lord Wallace of Tankerness
The noble Baroness is encouraging me to look at these pilots. However, I seem to recall that voting took place on a number of days. In Scotland, local elections were for many years on a Tuesday. For some reason, they all seem to have coalesced round a Thursday. Picking up the point of the noble Lady, Lady Saltoun of Abernethy, I recall that in 1978 the Hamilton parliamentary by-election took place on Wednesday because Scotland’s first match in the 1978 World Cup finals was being played on the Thursday. I am not sure what it did for the noble Lord, Lord Robertson of Port Ellen, but it did not do much for the Scottish football team.
There is a consensus on the need to find ways in which we can increase the turnout, which undoubtedly ensures that those elected to the other place have a stronger democratic mandate.
The noble Lord, Lord Howarth, referred to the briefing of the Electoral Commission, which echoed what the Electoral Commission said in the consultation undertaken by the previous Government. The Electoral Commission stated that it was,
“not opposed to weekend voting in principle, but that no change should be considered without clear evidence that it would be of significant benefit to the voter”.
That view was shared by the Committee on Standards in Public Life, which in its response to that consultation said,
“The Committee is not opposed in principle to moving the day of elections from Thursday to the weekend. But we have seen no evidence that such a move would bring any clear benefits … It is not obvious that [people] would find it easier to vote at the weekend”.
One might say in the Scottish context that this is a not proven verdict, but that does not mean to say that there should not be trials. With regard to advance voting, which the noble Lord, Lord Howarth, mentioned, that was referred to in the consultation paper on The Governance of Britain published by the previous Government. It pointed out in that consultation that, as part of the previous Government’s programme for piloting innovative voting methods, 20 local authorities had piloted advanced voting in polling stations since the year 2000. Evidence from these pilots, however, indicated that the availability of advanced voting had done little to increase turnout.
There are a number of issues and I recognise that this is inevitably an issue to which your Lordships’ House will wish to return. I hope this is not honeyed in any way and I am not standing at the Dispatch Box to say that the Government are about to launch an initiative with regard to weekend voting. However, picking up the point made by my noble friend Lord Newton, I want to make clear that we are not ruling it out. I want to reassure the House that not including something in this Bill will not rule out the possibility of us returning to this issue.
I do not believe—this is an important point—that this is the appropriate legislative vehicle to make the change. In this Bill, we have tried to do only that which is strictly necessary to establish fixed-term Parliaments and, as far as possible, reflect existing practice. It has become common practice to hold the elections on the first Thursday in May. Three of the last four were held on that day, the exception being in 2001 when the need to move it was widely agreed due to the outbreak of foot and mouth.
The noble Baroness, Lady Golding, also indicated that one of the issues that had to be looked at is that, if we are moving the date of parliamentary elections to the other place, should we also look at the local elections and, for that matter, the elections to the devolved Parliaments and Assemblies.
It is not a criticism of the drafting because I think the point of these amendments was to raise an important issue, but there are a number of consequential issues which would flow in terms of any change that was to be made. In the light of that, I want to reassure my noble friend that if this Bill goes through without amendments, that will not be used at a future date as evidence of Parliament agreeing that it will be that day. That was the assurance he was looking for. It will not be thrown back at him like that. I hope that in those circumstances, the noble Lord will agree to withdraw his amendment.
Lord Howarth of Newport
My Lords, this has been a lively debate with contributions from noble Lords all around the House speaking from their extensive experience and their serious concern that we should find the best ways we can to improve participation at general elections. As my noble friend Lady Golding reminded us, it is equally important that we raise participation in other elections, notably local elections, although that is outside the scope of the Bill’s Long Title.
I am most grateful for what the noble Lords, Lord Rennard and Lord Tyler, had to say. The noble Lord, Lord Rennard, speaks with even greater knowledge than the noble Lord, Lord Tyler, though it could be a close-run thing. Both of them made invaluable contributions, the noble Lord, Lord Rennard, rehearsing with us the somewhat dispiriting history of consideration of this issue—the unsatisfactory pilot scheme and the citizen summit that never took place. The noble Lord, Lord Tyler, made the extremely important point that our traditional practice of holding elections on a Thursday means that schools all over the country closed. That is undesirable.
On the other hand, the noble Lord, Lord Pannick, put his finger unerringly on two real difficulties. One is not necessarily an insuperable difficulty because he rightly reminded us that there are different religious traditions in this country and you cannot decently or appropriately legislate for polling to take place on one particular day of the weekend. He then went on to make a point that I take seriously: that it is desirable that as far as possible people should cast their votes on the basis of the same information and that, if some dramatic event were to intervene, that could have the effect of altering the tendency of polling on the second day. We would need to think carefully about that.
That serves to illustrate that there are significant arguments on both sides. I rarely disagree with my noble friend Lord Grocott on anything—he was my Chief Whip, after all—and particularly in the constitutional field but I am not sure there is not a hairline crack between our two personal positions on this particular issue. But he and the noble Lord, Lord Cormack, rightly appeal to our sense of tradition and history. What my noble friend Lord Grocott had to say about the importance of the drama of election day and what the noble Lord, Lord Cormack, had to say about the ceremony of election day were very important observations. We do not want in any way to diminish the occasion of polling, which, as the noble Lord, Lord Cormack, suggested, has perhaps been somewhat diminished by the increasing resort to postal voting. If postal voting has raised turnout overall, however, that is an important merit in it.
The noble and learned Lord, Lord Wallace of Tankerness, responded in as positive a spirit as he could but it remains the case that the Government, while they may have reviewed previous consultation, have not applied themselves to this question with any seriousness at all in advance of including prescriptive provisions in this fixed-term Parliaments legislation that polling will take place on a Thursday. The noble and learned Lord himself reminded us that at the moment there is nothing in the law that requires polling to be held on a Thursday.
If there is a major national crisis, as in Scotland, and the Hamilton by-election has to be moved from a Thursday to a Wednesday because of a football match, there is at least the freedom to do that. But this legislation would remove that freedom. The noble and learned Lord says that the Government are not ruling out a change, but by stating in this Bill their intention to legislate, they make it that much less likely that there will be a change. I had hoped that the Minister would have been able to tell us rather more definitely what the Government intend to do. We may or may not agree with his point, but he said that this may not be the right legislation in which to incorporate provision for polling to take place on a weekend rather than on a Thursday. He suggested it has to be considered on a separate track. I heard no convincing evidence from him that he intends to pursue that track.
While the feeling of the House is that it would be inappropriate to vote on this issue today, Amendment 16 tabled by Members of the Liberal Democrats, which would require the Prime Minister and the Government to have made up their minds about what they want to do by October 2013, has enormous merit. For my part, I beg leave to withdraw the amendment.
The Deputy Chairman of Committees (Baroness Pitkeathley)
As we come to Amendment 3, I remind your Lordships that if it should be agreed to I cannot call Amendments 4 to 8 for reasons of pre-emption.
Amendment 3
Lord Grocott
Lord Grocott
My Lords, I start by apologising to the Committee because my amendment includes the dreaded word “referendum”. I can understand why everyone else's heart sinks just as much as mine does at the very mention of that word. I tabled this amendment alongside my noble friend Lord Howarth, who has amendments along similar lines in this group—and they may well be better than mine—because I want to raise two or three issues. It is important that we correct an error that has been uttered on a number of occasions by no less a person than the Deputy Prime Minister. It is an error to say that this Bill removes the right of the Prime Minister to determine the date of the election. At Second Reading in the House of Commons on 13 September last year, the Deputy Prime Minister said:
“We have a Prime Minister who is the first in history to relinquish the right to set the date of the general election”.—[Official Report, Commons, 13/9/10; col. 622.]
What he should have said is, “This is the first Prime Minister to relinquish the right on behalf of future Prime Ministers to determine the date of the next general election”. Not only has this Prime Minister decided the date of the next general election, he has legislated to enshrine in law his choice of date. I hope from now on no one will use that as a justification for this Bill, which, as the House may know, is not a Bill that finds much favour with me. Can we at least correct that error? As I shall say later on, the Prime Minister is uniquely legislating to enshrine his favoured date in law, so people need to have a say about that, which is what we do in a referendum.
My second reason for tabling this amendment was to seek clarification from the Government on when and why they use referendums as a basis for constitutional change. The Committee is entitled to an answer to that question. The Deputy Prime Minister has said many times that these are hugely important constitutional changes. As far as I know so far, and we may still be counting, four major constitutional changes will be decided in this Parliament. We have already determined two, which are quite separate issues. The first was that there should be a referendum on AV and the second was that there should be fewer Members of Parliament. There is a referendum on one of those but not on the other. The one that we are debating now is to fix the terms of Parliaments, which is an important issue on which the present thinking from the Government is that there should be no referendum. The one coming down the line, which may take a bit of time in this House, is to abolish the House in its present form and replace it with senators.
I would simply like the noble and learned Lord, Lord Wallace, who always treats these questions with great seriousness, to tell us why there is a referendum for one of those four major changes but not the other three. What factors have the Government brought to bear in determining which will be decided by referendums? Although I need some persuading of this, we have been told quite frequently by the Government that this is a coherent whole of constitutional change.
Lord Cormack
The answer is simple: the Government knew that they could not get AV through the House of Commons. Therefore, they have gone to a wider electorate.
Lord Grocott
I hope that the wider electorate reach a sensible conclusion. We shall know soon enough.
The Earl of Onslow
As the leader of the Labour Party has been discouraging the Deputy Prime Minister from taking any part in the AV campaign, it will be interesting to see the outcome.
Lord Grocott
I am interested but also worried because I care deeply about the outcome of the referendum and the damage that I believe can be done to our constitution. But we must not go back over that. It has been concluded and now it is for the people to decide.
I do not favour any of these changes, but if they are to go ahead the public need to be consulted. A referendum should be considered to determine whether there should be a four or five-year fixed term because of what I hope the Committee will agree is a powerful point: that the Bill reduces the power of the electorate. It reduces the number of occasions on which the electorate can be consulted.
If you reduce the power of the electorate, which the Bill undoubtedly does, then surely the electorate have the right to be consulted about that. It was right in 1975 for the then Labour Government to have a referendum on the Common Market, as it was then called, because it reduced the power of this Parliament. By the way, I voted no in that one. It is right that the choice should be given to the public. It is unarguable that the Bill reduces that power.
Lord Maclennan of Rogart
Does the noble Lord believe in the opposite proposition—that to give power to the electorate you should not have a referendum? That might affect some of his earlier arguments about reform of this House.
Lord Grocott
I do not know which of the various constitutional proposals increases the power of the electorate. The noble Lord referred to reform of this House. One of the key reasons why I am opposed to this being an elected House is that it would seriously diminish the significance of a general election to the House of Commons. I hope that my argument is consistent; I will have to read it in Hansard tomorrow.
I hope that I can put this with some conviction but, according to my maths, since the 1945 election there have been 17 general elections in this country. If this Bill had been an Act, we would have had 13 general elections. I simply put this proposition: does that or does that not weaken the power of the electorate? There can be only one answer to that. The answer is yes.
I do not want to go to absurd lengths but we can all assume that, if there were no elections, that would seriously weaken the power of the electorate. I am not sure about the other end of that continuum—perhaps the Chartists with their annual elections. But there is no doubt that the convinced and settled view of the members of the Government who are voting on this Bill is that since the Second World War the British electorate have had too many general elections. Which ones should we not have had that we did have? Was it wrong in 1951 for a Labour Government who were tired to seek another mandate? Was it wrong of Mr Heath? Was it wrong of Harold Wilson, who had a majority of three in 1964, to call another election, or should he have soldiered on for another five years? Should Harold Wilson's Government in 1974 have gone on without a majority?
I would like to know the answer to a fairly simple question: why do the Government think that we have had too many general elections since the Second World War? Which ones were superfluous? There could be an interesting answer to that.
Baroness Farrington of Ribbleton
My Lords, between now and the next stage of this Bill I wonder if my noble friend could ponder whether, as has been proposed, the reason that AV is going to a referendum is because it could not be got through the House of Commons. Does that mean that we must have a referendum on Lords reform if it proves impossible to get it through your Lordships’ House?
Lord Grocott
What a persuasive argument—I am completely convinced by that.
If the Government are going to reduce the power of the voters over their Government, they must give us a very convincing argument as to why that is desirable. Of course, I very much hope that my amendment becomes entirely surplus to requirements, because I very much hope that the Committee will decide later that we should have four-year gaps between Parliaments. I do not agree with fixed terms, but if there is to be one I hope it is four years. For the first time in my life I am operating entirely in accordance with the Liberal Democrats’ manifesto and I hope they will be voting with us on four-year Parliaments. However, if the Government unilaterally reduce the power of the electorate to have general elections and to make their decisions about Governments, I hope that they will only take this power away on the authority of the electorate in a referendum.
Lord Howarth of Newport
My Lords, I am very happy to support the spirit of my noble friend Lord Grocott’s amendment. I have tabled two amendments—Amendments 57 and 58—which also require that a referendum should take place before we move to fixed-term Parliaments in this country.
I do not, in general, favour referendums, but there is a particular case for holding them when major constitutional change is being proposed. I think that is a view that the Constitution Committee reluctantly came to. The basis of that has to be that the constitution belongs to the people—it is not the property of those politicians who happen for the time being to have the privilege of serving in either the House of Commons or the House of Lords. Those who are Members of Parliament in either House, and certainly those who are in Government, should regard themselves as holding the constitution in trust on behalf of the people, by whose authority they have been given and entrusted with the opportunity to serve. They should treat that constitution with the very greatest respect and should move to change it with the very greatest caution. That applies even more particularly to a Government such as this present coalition Government, which does not have a mandate from the electorate for its policies.
It is, as my noble friend Lord Grocott suggested, curious that this Government—which makes great claim to be a liberalising Government who want to improve the quality of our democracy and increase the accountability of Government, and indeed Parliament, to the people—are proposing legislation that would mean that we would in practice have fewer general elections than we have had in the past. The average interval between general elections since the war has been three years and 10 months; if the Government have their way on this Bill, it will be not less than five years. That is one of the reasons why I, like my noble friend Lord Grocott, believe that—although I am no enthusiast for legislating to fix the term of Parliament—if we are to fix the term, then we had better fix it at four years. We do not want to see accountability diminished in a major measure of constitutional reform.
It is also curious that the Government believe that it is appropriate to hold a referendum on changing the electoral system and that it is appropriate to hold referendums when there may be some transfer of power—possibly no very great transfer of power—between London and Brussels, but they do not think that it is appropriate to hold a referendum on whether we should move to fixed-term Parliaments. My noble friend Lady Farrington raised the question of whether there might be a referendum on reform of the House of Lords, which would be a very major constitutional change by any standard. It seems extraordinary that the Government should propose to take that forward without incorporating provision for a referendum in the legislation.
I am not necessarily a devotee of consistency in constitutional matters, because I believe that there are many anomalies in our present constitutional arrangements, which have grown up for compelling historical reasons, that actually provide flexibility and enable the constitution to accommodate different traditions and to adapt itself as time goes by. If we are slavishly schematic in our approach to constitutional change, we shall be even more likely to get it wrong; but I wonder why the Government are quite so inconsistent in their approach to holding referendums on constitutional reform. Surely the Government should conduct themselves on a certain set of principles.
Turning to the particular amendments that I have tabled, I suggest to the House that they incorporate a better design for a referendum than the design of the one we are to have on 5 May on electoral change—there are differences between what I propose and what Parliament has enacted at the behest of the Government. The referendum that I have proposed would be advisory only and would leave scope for Parliament to meditate upon the message that voting in a referendum sends to Parliament. Amendment 57 would also provide that, if less than a threshold of 51 per cent of the electorate support the introduction of fixed-term Parliaments, then the question would be dismissed. That latter point should have applied also in Amendment 58—it was an omission on my part not to have included that in the drafting of that amendment. If we come back to this issue on Report, I can repair that then.
My amendments would provide for two questions. The first would be to ask the people whether they favour the introduction of fixed-term Parliaments, as provided for in the legislation. The second would ask them the other key question: if we are to have fixed-term Parliaments, do they think it right that the term should be fixed for four years or for five years? We all agree, I think, that this is quite the outstandingly important issue that remains to be resolved in this legislation apart from the overall issue of whether there should be fixed-term Parliaments, which has been approved in Second Reading. However, the question of four or five years remains wide open. I put it to the House that that may also be something that should be offered for the decision—or at least for the advice—of a wider electorate.
Lord Marks of Henley-on-Thames
My Lords, I am one of those who is largely in favour of referendums for important constitutional reforms. The noble Lord, Lord Grocott, is quite right to ask in what circumstances referendums are appropriate and to say that the matter should be considered by the House.
The Constitution Committee in 2010 used the word “fundamental” in respect of constitutional reforms for which referendums were appropriate. The question arises as to what is meant by fundamental. I accept entirely that a referendum is appropriate in respect of the proposed change in the voting system to AV on the 5 May, as it was appropriate for the European referendum in 1975, which noble Lords will know was the last UK-wide referendum—I am not suggesting that such referendums should take place only every 36 years, or anything like it. However, it is significant that the same Constitution Committee report produced a list—not an exhaustive one—of the type of issue that might be appropriate, in which it included any decision:
“To abolish the Monarchy;
To leave the European Union;
For any of the nations of the UK to secede from the Union;
To abolish either House of Parliament;
To change the electoral system for the House of Commons;
To adopt a written constitution; and
To change the UK’s system of currency”.
The report made clear that that was not intended to be a definitive list.
Lord Howarth of Newport
Does the noble Lord agree that this Bill marks a very significant step towards the creation of a written constitution in this country?
Lord Marks of Henley-on-Thames
My Lords, I do not accept that. It might indeed be desirable to have a written constitution, but that is a matter for another day.
I accept that the Bill provides for an important constitutional reform, but it is not a fundamental change to our constitution. I say that for a number of reasons. First, in terms of whether or not a referendum is appropriate, the fixed term proposed is within the existing maximum term of a Parliament. Under the 1911 Act, Parliament can last for up to five years; under this Act a Parliament will last for five years unless either of the trigger mechanisms for an early dissolution is activated.
The Earl of Onslow
May I interrupt? Actually, it is a fundamental change. As the Bill is not subject to the 1911 Act, we can veto this Bill because it seeks to extend the life of Parliament. That is a fundamental constitutional change, which in my view should be resisted at all possible costs.
Lord Marks of Henley-on-Thames
My Lords, the noble Earl is entirely right to say that the Bill is capable of extending a Parliament under the two-month extension proposal. That is the reason why the Parliament Act does not apply. That does indeed give this House the right to veto the legislation, but it is a non sequitur to suggest that it follows from that, and that alone, that this is a fundamental reform of the type to warrant a referendum.
Baroness Farrington of Ribbleton
Can the noble Lord, Lord Marks, explain to me, because I listened to the logic he was developing, how changing a system of voting for a Chamber of Parliament, where that Chamber is already elected, is a greater change than introducing a system of voting for a Chamber of Parliament which is not elected at the moment? I raise this as somebody who is in favour of reform—I do not want to be dismissed as somebody who is not—but I find a real fault line in his argument, unless he is about to conclude that he thinks there should be a referendum on Lords reform.
Lord Marks of Henley-on-Thames
My Lords, the noble Baroness’s logic is seductive and attractive, but it misses the point that, as all noble Lords accept, this House accepts the primacy of the House of Commons. Therefore, a change to the voting system for the House of Commons, which alters the entire electoral system for the House that has democratic primacy, should have different weight accorded to it from that of a change to the composition of the upper House.
Baroness Farrington of Ribbleton
My Lords, can I just press the noble Lord further? As I understand it, the noble Lord’s party’s view is that AV is, to a degree, an acceptable alternative to the present system of first past the post. However, I believe quite senior members of his party have said they regard AV as a staging post. If your Lordships’ House were to be elected by a system that was further down the staging-post road, would we not be in a difficulty, using the reasoning of the noble Lord’s own party, given that it is not certain that the democratic legitimacy of the House of Commons —which I accept—would be accepted by a more democratically elected second Chamber?
Lord Marks of Henley-on-Thames
My Lords, the noble Baroness is perhaps addressing a debate that we are yet to have on another occasion. It is well known that in the past we have favoured, and indeed do favour, other electoral systems. It is also well known that the coalition agreement commits us to a proportional system of representation for the election of Members of this House. However, noble Lords will accept, I hope, that that is a matter for another day and what we are now concerned with—if I can just finish my response to the noble Baroness—is considering an amendment which calls for a referendum on the Fixed-term Parliaments Bill and a separate referendum on the question of four years or five. The future electoral system for this House is of interest and of course of some relevance, but it is not central to this point. I give way to the noble Lord.
Lord Cormack
I am extremely grateful to the noble Lord, but when he read out the list of issues which could be subject to a referendum he mentioned the abolition of the monarchy and the abolition of either House. Does he not accept that, if your Lordships’ House is replaced by a different second Chamber, wholly elected, it has to be abolished first? Therefore, surely there is no logic at all in saying there should not be a referendum on that issue.
Lord Marks of Henley-on-Thames
My Lords, I do not accept that. It is not the abolition of a House to change its composition, however attractively the point might be put.
I remind your Lordships’ House that we had a very significant constitutional reform with the Constitutional Reform Act 2005, whereby the highest court in the land, having been constituted by a committee of this House, was replaced when the Supreme Court was established. Nobody then argued that there should be a referendum on that very significant and wide-ranging change in the constitution.
Both the noble Lords, Lord Grocott and Lord Howarth of Newport, addressed the question of four or five years. That is an important point which we are addressing in this Bill and on which there will be a separate debate during this Committee stage, and I would not be at all surprised if either or both of them contributed. However, the point here is not the length of a fixed-term Parliament, which is a matter of judgment and on which many speeches were made at Second Reading, including my own, but whether this is a matter for a referendum.
There are a number of further points. In a lengthy consideration of the Bill by the Constitution Committee —which I might say was not an enthusiastic report endorsing the Bill and the way it had been handled—it was not suggested that this was a matter for a referendum. Had it genuinely been believed at that stage that there were respectable arguments that this was a fundamental issue of a nature that required a referendum, I suggest that it would have been put before the committee and either adopted or rejected.
Baroness Farrington of Ribbleton
My recollection is that the Constitution Committee took the view that there should have been pre-legislative scrutiny, which would have led to many of these points being discussed properly, particularly the role and relationship proposed in this Bill between the Prime Minister and the Speaker in another place.
Lord Marks of Henley-on-Thames
My Lords, the noble Baroness is absolutely right to draw attention to the fact that the Constitution Committee thought that pre-legislative scrutiny would have been a good idea. Nevertheless, the committee heard evidence over a number of days and read a great deal of written evidence from some of the leading academics in the land and nowhere was it suggested that this was a referendum issue in my reading of the evidence of the report. That was the point that I was attempting to make.
The other point of importance that I would invite noble Lords to consider is that the principle of fixed-term Parliaments was subject to manifesto commitments of the Labour Party and my own party and in neither case was there a suggestion that it should be the subject of a referendum rather than legislation. The Conservatives embraced that commitment very shortly after the election, and the Members of Parliament elected as Conservatives to represent their constituents did not seek to interpose a referendum before this legislation should become law.
There is a danger, which I urge the House to bear in mind when it considers these amendments, that we move from a representative democracy, which the vast majority of us value a great deal, to government by plebiscite. If you lose sight of the principle that only fundamental changes require referendums, you move some way down that road.
Lord Grocott
Did the noble Lord not say in the first part of his remarks that he was very much in favour of referendums? I am not sure how that squares with what he has just said.
Lord Marks of Henley-on-Thames
I qualified that by saying, “on important matters of constitutional reform”, and I then went on to explain what the Constitution Committee said when they used the term “fundamental”. I stand by that. What I am saying is that, if you extend the number of referendums that you have well outside the ambit of what is fundamental, you move away from representative democracy and towards government by plebiscite. It is a matter for Parliament properly to decide—both the principle and the question of four years or five.
I make one final point about Amendment 57, which the noble Lord, Lord Howarth of Newport, applauded —in spite of the fact that it is his own—and said that he liked its design. He said that the amendment was advisory only. That is entirely wrong since, as drafted, the amendment is a wrecking amendment, as it seeks to impose a mandatory 50 per cent threshold, which means not 50 per cent of those who vote but 50 per cent of the electorate, without which the Bill cannot become law. That is a very high threshold indeed. It means that a turnout of anything less than 50 per cent cannot give effect to the Bill, even if not a single no vote is cast.
Lord Cormack
It is nowhere near as high a threshold as has been put in this Bill for a dissolution of Parliament.
Lord Marks of Henley-on-Thames
My Lords, 66 per cent of the House of Commons voting on an occasion when we may expect a turnout of well over 99 per cent is not, in my respectful submission, a very high threshold. The thresholds are different in kind, and my noble friend Lord Cormack knows that perfectly well.
In the recent Welsh referendum we had a turnout of 35 per cent, which was seen as somewhere between respectable and high. Not only do thresholds detract from the view that referendums are valuable, because they involve telling the electorate that we propose to ask for its view and then reserve the right to turn around and reject it after the event, but thresholds of this magnitude, which are mandatory in this way, do nothing for the cause of democracy.
Baroness Hayter of Kentish Town
I apologise to your Lordships for intervening at this stage when I was not here for Second Reading, not least because I missed the maiden speech of the noble Lord, Lord Cormack, which I have had the pleasure of reading since then.
The reason why I was not here on St David’s Day when the Second Reading happened was that, thanks to the Commonwealth Parliamentary Association, I was at the New Zealand Parliament, which I had the great pleasure of visiting with the noble Lord, Lord Rennard, although he made it home rather faster than I did. When I was there, I discussed the three-year terms that they have in New Zealand, and how business and elections could best be organised around that period. It is true that many people in New Zealand, politicians and civil servants, consider that four years would be a better period. I have to say that they do not even go to five years; it was not on their agenda at all. The interesting thing from the point of view of this debate is that, despite the fact that many would like to move to a four-year period, they have never dared to test that in a referendum with the electors, because from their sample polls and from listening they know that the move from three to four years would be rejected. That is a lesson for us to learn about extending a Parliament’s life. The Government should perhaps heed that.
There is a broader lesson with this amendment, and that is to note the incredible significance that the legislators in New Zealand attach to their electorate. They would not dare even to ask them to extend their term of office without a referendum. They will not do that until they think they can win it. So we should ask the people their view before we entrench anything new in our law. I would even like to put the option of three years as well as four years and five years in that referendum, but I would certainly favour at least going out to ask people for their opinion to find out what suits them rather than suits the politicians who will be elected in those elections.
Lord Cormack
My Lords, when I was first elected to the other place, I was a very staunch believer in parliamentary democracy, full stop, and did not like the idea of introducing the referendum into our system. But the fact is that we have done so, and on a number of constitutional issues. We had the referendum on what was then the Common Market, or European Union, in which I participated on a platform with friends and colleagues from the Labour Party, urging a yes vote, while I believe that the noble Lord, Lord Grocott, was doing the opposite. Now of course I find myself in virtually total agreement on almost every subject of a constitutional nature with the noble Lord, and that is a very happy relationship. But it is a bit like the atom bomb or the internet; you may have strong views, but you cannot uninvent things—and you cannot uninvent the importation of the referendum into our constitutional system. And you should not treat it capriciously.
The noble Lord, Lord Marks, uttered his honeyed words. I have not been a Member of your Lordships' House for long, but I have heard the noble Lord’s felicitous utterances on a number of occasions and he is very good on honeyed words. But I could not help but think of Pickwick Papers and the case of Bardell, where there is “a weak case and an abused plaintiff's attorney.” It was a bit like that, with the capricious favouring of one referendum rather than another. By what turn of logic anybody could suggest that the creation of an elected senate does not involve the abolition of this House I do not know—unless it is a Liberal desire that the two Houses should sit separately or work alternate days. That is a fundamental constitutional proposal. I believe, along with the noble Lords, Lord Howarth and Lord Grocott, that the issue that we are discussing this evening is at least worthy of consideration for a referendum.
I hope that my noble and learned friend Lord Wallace of Tankerness will be able to explain what the coalition Government’s philosophy is on referenda. I prefer the word referenda to referendums, as I am sure the father of the noble Lord, Lord Howarth, the High Master of St Paul’s, would have done. What is the Government’s philosophy on referenda, and what is the list of subjects that merits that constitutional accolade? It was reasonable to suppose that AV should be the subject of a referendum, although as I indicated in my intervention the only reason that we are having one on that is that it was not considered possible to get it through the House of Commons. Is the Government’s definition of a referendum that if you cannot get something through the Commons you have a go by going to the people? Is that the definition? If so, there is a certain cynical logic in it and I am sure we would like to hear that. However, if the other definition is that we will have a referendum only on an issue of supreme constitutional importance, is not the alteration of our electoral system to have fixed-term Parliaments, to which I am not intrinsically opposed, a very fundamental constitutional change? As the noble Lord, Lord Grocott, indicated, it will mean that the people have less frequent chances of voting. If that is to be the case, should they not be given the opportunity of saying whether that is what they want?
The Earl of Onslow
My Lords, I crave your Lordships’ indulgence and apologise for not being able to speak at Second Reading. There was a slight horlicks done by our Whips’ Office, for which I apologise.
This Government, who I support extraordinarily strongly, have the opportunity to produce some of the greatest social reforms and improvements for the benefit of this country since 1911. If Iain Duncan Smith gets his welfare reforms right, that will be a major contribution to the well-being of this country. If George Osborne gets the economy right, it will be of major benefit. If education reforms and medical reforms are as good as I personally think they are going to be, these will be the successes of a very great Government. But why have they gone completely doolally over constitutional change?
The trouble with this country is that constitutional change is extraordinarily easy. Every other country has complicated locking mechanisms in it. The Bill reduces the power of the House of Commons, reduces the power of the electorate and increases the chances of chaos. In 1870 or 1871, the French Government resigned. Either the President or the Prime Minister refused a dissolution—I cannot remember which. As there was no possibility of a dissolution, they played the game of pass the parcel and wrecked French government from 1870 until 1945. That is bad constitutional form. We would do the minimum amount of harm by adopting something along the lines of what the noble Lord, Lord Grocott, says. In my 30 or so years in this House, I have regarded myself as a disloyal Conservative, and I will go on being a disloyal Conservative. If they are doing something that I believe is as fundamentally wrong as this, I will say so. That does not mean that I will come and join you over there.
Lord Pannick
My Lords, I, too, support the observations of the noble Lord, Lord Cormack, as to the need for careful consideration of constitutional reform. The noble Lord, Lord Marks, accurately pointed out that the Constitution Committee, of which I am a member, did not suggest that a referendum is required in relation to the introduction of fixed-term Parliaments. As the Committee well knows, the Constitution Committee expressed grave concern in paragraph 20 of our report that this Bill owes,
“more to short-term considerations than to a mature assessment of enduring constitutional principles”.
I suggest that the Government’s position in relation to whether a referendum on constitutional reform is appropriate is precisely a matter that appears to be determined by short-term considerations—alternative vote, yes; reform of this House and fixed-term Parliaments, apparently no.
It is very difficult to deny that the Bill that we are currently considering will introduce major constitutional reform. In paragraph 40 of our report, we refer to the evidence that we heard from Professor Vernon Bogdanor in which he pointed out that the Bill, if enacted, will prevent,
“a newly chosen Prime Minister between Parliaments from going to the country”,
it will prevent,
“a Prime Minister who has a new policy for which he may seek a mandate from going to the country”,
and:
“Most importantly of all, because we could be moving into that situation with our hung Parliaments, it means that coalitions can change in the middle of a Parliament without the people being allowed to pronounce on that”.
This is a major constitutional reform. I am no fan of referendums, but I would welcome guidance from the noble and learned Lord, Lord Wallace of Tankerness, on behalf of the Government, as to what their policy is as to when a referendum is appropriate for constitutional reform and when it is not, and I would welcome an assurance that that issue is not determined by short-term political considerations.
Lord Brooke of Sutton Mandeville
My Lords, I realise that I regard the noble Baroness, Lady Hayter of Kentish Town, as an agreeable ally on constitutional matters, but I was sorry that the noble Lord, Lord Howarth of Newport, felt it necessary to precede her in this short debate. Of course I understand the protocol that he was pursuing, but we always know that the noble Lord, Lord Howarth of Newport, will have spoken before the Minister rises—he is indeed a pillar of the constitution. However, I think that chivalry has a role. At Second Reading, I alluded to the French Revolution. In Burke’s memorable sentences:
“It is now sixteen or seventeen years since I saw the queen of France … the age of chivalry is gone. That of sophisters, economists, and calculators, has succeeded; and the glory of Europe is extinguished for ever”.
I understand why the noble Lord, Lord Howarth, spoke but a little variety in our experience might bring the government Benches back into the Chamber on constitutional matters, as he was wishing earlier, just as everyone who speaks in these debates has their own personal and individual subjective view on how we could increase voter turnout.
An aspect of variety in this speech is that, most unusually, I disagree with the noble Lord, Lord Grocott, whose constitutional views I respect just this side of idolatry. However, I have a reservation on this occasion. He prayed in aid the statistical fact that there would have been four fewer elections since the war under this Bill than factual history produced. I have profound admiration for the maturity of the British electorate. On only one occasion among those 17 post-war elections did they possibly make a mistake, as they themselves may have conceded, by giving more votes to one party and more seats to the other, but that does not mean that we may want more opportunities as an electorate to exercise our maturity or indeed our wisdom.
The reductio ad absurdum to which the argument from the noble Lord, Lord Grocott, could be made subject is that we should hold a referendum on whether the electorate wanted more elections or fewer. There is some polling evidence that they would vote for fewer but that would accelerate the number of referendums we felt it necessary to think that we need.
Lord Hunt of Kings Heath
My Lords, that is an interesting contribution to follow. Like the noble Earl, Lord Onslow, I am pleased to make rather a late entry into your Lordships’ deliberations on this Bill. I am glad that it is on such an interesting matter and I am grateful to my noble friends Lord Grocott and Lord Howarth for their amendments.
As a number of noble Lords have suggested, this is part of what was promised to be a comprehensive package of reforms on the constitution by the Government. We have already had the Parliamentary Voting System and Constituencies Act. We now have this Bill and before too long, although it seems to be a somewhat lengthy time in coming, we are promised the draft House of Lords reform Bill. Like other noble Lords, what I find so puzzling is the piecemeal approach and lack of consistency on the part of the Government to how these different measures are brought before Parliament, then in some cases put to the electorate and in others not so.
We are to have a referendum on AV. We are also promised, in the coalition agreement, a referendum on any changes or amendments to the European Communities Act 1972 where there is a proposal under a treaty to transfer areas of power or competencies. Yet there is to be no referendum on the principle of a fixed-term Parliament, on whether it should be for four or five years, or on reform of your Lordships’ House. I agree with other noble Lords that, arguably, this Bill and the one to come are constitutionally much more significant than changing a voting system from first past the post to AV.
As the noble Lord, Lord Pannick, said—it is worth reflecting on this—the view of the Lords Select Committee on the Constitution is that this Bill owes,
“more to short-term considerations than to a mature assessment of enduring constitutional principles”.
I agree with that. My noble friends Lord Grocott and Lord Howarth are surely right that the period of five years must mean that the voters will find themselves less able to hold the Executive to account. That is therefore of significance. The noble Lord, Lord Brooke, may be right in suggesting that the public might welcome being inconvenienced on fewer occasions. But should that not be put to the public in a referendum? Surely it is the same when it comes to Lords reform. Like the noble Lord, Lord Marks, I think that the issue of Lords reform is highly significant to the debate that we are having.
Lord Tyler
The noble Lord and I both served for many months on the working group chaired by his colleague, Mr Jack Straw, when we looked in very considerable detail at the various proposals for reform of your Lordships’ House. At not one single moment through the whole of that White Paper’s preparation did he or his colleagues suggest that it was necessary for those proposals to be put in a referendum for the public to take a view. Why is there suddenly this interest in making that proposal the subject of a referendum?
Lord Hunt of Kings Heath
It is because it is part of a series of measures of constitutional change. The noble Lord, Lord Tyler, will also know that the intention was always to produce that White Paper, which we did, then to ensure that it was in the manifestos of the three parties at the last election, which it was, then to bring forward proposals. For myself, I believe that a referendum ought to be considered in the context of the current Government’s decision to go for a referendum on AV and their other constitutional changes; and because it is abundantly clear, from all that I have read and heard, that they are not prepared to deal with the issue of powers when it comes to Lords reform.
My noble friend Lord Grocott and I do not always see eye to eye on Lords reform, but I certainly agree with him when he challenges the naive assumption that an elected senate will simply carry on in much the same way as your Lordships’ House does, without any impact on the House of Commons. I do not accept that; an elected second Chamber is bound to impact on the Commons and on our constitution in a major way. In many respects, it will be a new House even though there may well be a transition period between where we are and where we get to in the end. The same applies to the Bill. As a result of the Bill there will be less accountable Parliaments, because they will last longer, and a legislature with a more limited ability to evict a Government who have lost the confidence of the Commons. I say to the noble Lord, Lord Marks, that that is pretty fundamental to me. At the very least the Minister, whom we all value for his contributions on constitutional issues, ought to have a shot at showing where the consistency is between those constitutional changes which are to be subject to a referendum and those which are not.
Lord Wallace of Tankerness
My Lords, we have once again had a spirited and interesting debate with a number of important points made. It is also obvious that some of the issues raised went beyond the question of a referendum and into some of the detail of the different constitutional reforms that have either been debated and passed or are about to come down the track.
Perhaps I might start by taking issue with the noble Lord, Lord Grocott, on a couple of the points which he made at the outset. He said that he hoped that never again would he hear that the Prime Minister was surrendering power or determining the date of the election. While it is the case that the Prime Minister and the Government are, in this Bill, putting forward a date for an election as being the first Thursday in May 2015, and while I hope that the Bill will be passed with that in it, that in itself means that the Prime Minister has surrendered a power because it is not possible—
Lord Wallace of Tankerness
He has actually put it to Parliament for it to support. Parliament will have had to vote that through, as is quite clear because we have other amendments coming down to change that date. Unless circumstances arise that would trigger the mechanisms in Clause 2, the Prime Minister of the day will not have the opportunity to seek Dissolution when it might seem opportune other than to have the election on the date set down in the Bill. He will have surrendered that power.
The Earl of Onslow
The Prime Minister has said, perfectly reasonably, that he thinks his Government will go on until 15 May 2015. He has made a perfectly legitimate choice to the House of Commons, but binding his successors is a different matter altogether.
Lord Wallace of Tankerness
My Lords, my noble friend’s point goes to the heart of whether one should have a fixed-term Parliament, bearing in mind that no Parliament can bind its successor. We debated the arguments for fixed-term Parliaments at Second Reading. I believe that they would ensure that Governments were able to plan, as indeed could Parliament, for a fixed period, and that they would not allow a Prime Minister of the day to seek an opportune moment to go to the country earlier than the full length of a Parliament for partisan reasons. This is an advance on what we have at the moment.
The point I am making is that if the Bill becomes law as it currently stands, the Prime Minister’s hands will be tied. If he saw an advantage some time in the spring of 2014, it would not be possible for him to cut and run because, if the Bill was on the statute book, he would not be allowed to do so. The fact that the Bill ensures that Parliament cannot otherwise be dissolved means, as the noble Lord, Lord Hennessy, remarked at Second Reading, that the Prime Minister has given up an important power.
We could debate whether the electorate have been denied as many chances to go to the polls as otherwise. The crude arithmetical approach—I do not mean crude in a pejorative way—adopted by the noble Lord, Lord Grocott, did not take into account that in no case since 1945 would any circumstances have arisen that would have triggered the mechanisms for early Dissolution or an early election under Clause 2; he assumes that that would never have happened. However, if one looks at history, it may well have happened in 1951 when there was a consensus between the parties that an election was needed. It may well have happened in February 1974. I know that my noble friend Lord Cormack thinks that the then Prime Minister, Mr Edward Heath, was wrong—and, indeed, as the electorate pointed out, he probably was—but there may well have been circumstances then in which it was felt that the Government of the day, and, one assumes, the Opposition, would not have stood in the way of an election, and that could have triggered Dissolution. It may well be that, as a result of that election in 1974, when there was no working majority for any party, another election may again have been agreed.
The point I am trying to make is that you cannot simply indicate that every Parliament would have gone the full five years since 1945 because there may well have been circumstances during these years that would have triggered an election. That is the whole point of the provision of trigger mechanisms, which no doubt the Committee will debate in due course. With issues such as no-confidence Motions and their wording, there is plenty of material and meat for debate.
My noble friend Lord Onslow, in his response to my noble friend Lord Marks, asked whether the Bill would extend the lifetime of this Parliament. My noble friend Lord Marks was right to say that it has the potential, if the power is used, to extend the date by two months in certain agreed circumstances, such as the foot and mouth outbreak in 2001. However, it is important to put on record that the general election last year took place on 6 May and that the first meeting of the new Parliament took place on 18 May; therefore this Parliament can continue until 18 May 2015. The latest date on which an election could be held is 11 June 2015, so stipulating the date of 7 May 2015 does not extend the life of this Parliament. The power is there to be used in exceptional circumstances and is subject to the votes of both Houses, and that is why the Parliament Act would not apply.
The amendment invites the Government to hold a referendum on whether the general election should be held in May 2014 or May 2015, although it makes no provision for the result of a referendum to be reflected in the length of a fixed-term Parliament after that general election. I think we get the spirit of what the noble Lord, Lord Grocott, is moving. My reaction is similar to that of my noble friend Lord Brooke; I am not sure what the public will make of being invited to choose the date of the next general election. I suspect that they would consider that as one trip to the polling station that they did not need to make.
The noble Lord, Lord Grocott, asked my noble friend Lord McNally which issues would be submitted to a referendum, and my noble friend replied:
“the Government believe that Parliament should judge which issues are the subject of a national referendum”.—[Official Report, 24/1/11; col. 671.]
Indeed, it will be possible for Parliament to make that judgment on any legislation.
As to the referendum on the alternative vote, let me try to put into context where we are. I do not make any bones about the fact that in the aftermath of the last general election, when quite clearly no party had an overall majority, there were coalition negotiations in which we tried to seek agreement. This has put in place a Government who are doing things of which my noble friend Lord Onslow heartily approves. I have been involved in coalitions in devolved Administrations, and there is inevitably an element of give and take and compromise in the negotiations. It is quite clear that the Conservatives did not support electoral reform in the shape of the alternative vote, and I do not shy away from the fact that some movement was required on that if there was ever going to be a coalition that would address the immediate economic crisis facing the country. There was therefore an agreement that there should be a referendum on the alternative vote, a policy that had been in the Labour Party’s manifesto. The Conservatives did not espouse a policy for fixed-term Parliaments, but they were prepared to accept it as a part of a coalition agreement because the Liberal Democrats were prepared to accept many other things. This has subsequently laid the foundations to get us out of the economic and fiscal mess bequeathed to the Government.
Both the Labour Party and the Liberal Democrats had a commitment to a fixed-term Parliament in their manifestos, although neither of them said what the period would be—certainly the Liberal Democrats did not say so. We had party policy papers from the past, but we did not say four years in our manifesto. Crucially, neither party said that there would be a referendum on that commitment. Contrast that with the Conservative Party, which indicated that it wanted referendums on British membership of the European Union and ceding further powers to Brussels.
Baroness Farrington of Ribbleton
The Minister is very careful in his choice of words. Can he assist me? What should I say in the referendum campaign to people who ask me whether there will be the same AV system for voting for Members of the House of Lords? If it is not to be the same, what should I say to people who ask me why we should not have the same system for the House of Lords? The fundamental flaw in the Government’s policy is not the options that they choose on an individual issue, but that when they all come together they begin to look like a committee trying to design something but not knowing how many legs it has or whether it has two heads.
Lord Wallace of Tankerness
Far be it from me to suggest how the noble Baroness should answer questions about the merits of the AV system. I am not sure which side she is on but I should like to think that we are on the same side. I cannot answer her question because I am not a member of the committee looking at Lords reform and have not seen its proposals. I genuinely do not know the answer to the question.
I do not think that it would be appropriate to go into the merits of Lords reform in the context of this Bill, but I pick up the point made by my noble friend Lord Tyler that in all the discussions with the previous Government on the committee chaired by Mr Jack Straw, it was never anticipated that there would be a referendum. As was confirmed by the noble Lord, Lord Hunt of Kings Heath, the purpose identified was that a White Paper would propose either a wholly or a substantially elected second Chamber, which would go into the manifestos of the three main parties. Indeed, that proposal was put before the electorate in the manifestos of the three main parties. I did not find it a very convincing argument that there should now be a referendum on Lords reform or anything else just because this Government have brought forward other constitutional measures.
Lord Hunt of Kings Heath
My Lords, the noble and learned Lord will know that the Government’s intention is that when the draft Bill is published, it will then go before a Joint Committee of both Houses for pre-legislative scrutiny. If, as a result of that pre-legislative scrutiny, the Select Committee does indeed report that there are significant constitutional issues involved in the proposals, would the Government then consider a referendum?
Lord Wallace of Tankerness
Tempting though the honeyed words of the noble Lord are—that seems to be the phrase of the night—he knows full well that it would be wrong of me to anticipate a hypothetical situation regarding that committee other than to confirm that it is proposed that there will be a Joint Committee to carry out pre-legislative scrutiny. It would be wrong for me to speculate on what that committee will propose, because that is some way down the track, or what the Government’s response would be.
My noble friend Lord Marks indicated that the previous Government brought forward legislation that fundamentally changed the relationship between the judiciary, the Executive and Parliament, and did so without a referendum. That might be thought to be a far more fundamental and far-reaching constitutional reform than the one we are considering. With the exception of the proposed referendum on the alternative vote, the Constitutional Reform and Governance Act, introduced in this House before the wash-up, had a plethora of constitutional measures, none of which, other than the AV referendum, sought to have a referendum attached to it. While I take on board the strictures of the noble Lord, Lord Pannick, on the Constitution Committee’s consideration and view on this Bill, the committee did not, as he confirmed, recommend that there should be a referendum. If one reads the Constitution Committee report from the previous Session, when I was a member, one detects a great reluctance to go down the route of referendums—or referenda, in deference to my noble friend Lord Cormack.
The items on the list read out by my noble friend Lord Marks, including the abolition of the monarchy and the secession of one of the nations from the United Kingdom, are of a different order from what is proposed in the Bill. This country is, after all, governed by a system of representative democracy in the other place. We in Parliament are basically entrusted with the power to make important decisions on behalf of the people of this country and, in the other place, by the people who are elected to make these decisions as representatives of the people. There must be an exceptional reason to ask people a direct question in a referendum, and I do not believe that the case has been made this evening for that exceptional high threshold to have been reached in respect of the Bill. I therefore urge the noble Lord to withdraw the amendment.
Lord Grocott
My Lords, I really am grateful for the contributions that have been made to this debate, not least because, as I said at the beginning, I felt that I needed to apologise to the Committee for mentioning the word “referendum”. It seems that there is still a fair degree of enthusiasm for talking about it now.
I will not use the term “honeyed words”, but the noble and learned Lord, Lord Wallace, always puts together a strong argument. I must say, however, he was on pretty weak ground when he tried to suggest that it was not the Prime Minister who decided that the next general election will be on 7 May 2015. No less an authority than his own dear leader said:
“We have a Prime Minister who is the first in history to relinquish the right to set the date of the general election”.—[Official Report, Commons, 13/9/10; col. 622.]
Who did set the date of 7 May 2015? If it was not the Prime Minister, who was it? That decision was quite clearly made by this Prime Minister, and the only rights he is relinquishing are those of future Prime Ministers. I suggest taking the Denis Healey advice on that one—when in a hole, stop digging. The Prime Minister made his decision, with the Deputy Prime Minister, for the understandable political reason that they are in a fragile political situation following the general election and they had best try to bank five years in the job rather than risk their term being foreshortened. I really cannot put it any more strongly than that.
The noble and learned Lord suggested—and this may or may not be true; this is, by definition, something that cannot be demonstrated conclusively—that there might have been a few more general elections than I said since the Second World War if the provisions of this Bill had been in operation. He suggested that there might have been scenarios in which a general election would have been triggered according to the provisions that deal with that. I find that argument pretty unconvincing. I am trying to imagine a scenario in the House of Commons when two-thirds of the Members—that means the whole of the governing party and a substantial number of opposition party members—were cheerfully voting together to charge to the polls. It is very difficult to imagine.
The only time when an election would have been triggered under the provisions of this Bill was in 1979, when the Government lost a vote of confidence. I will not repeat too much of what was said on Second Reading, but that seems to have been the perfect operation of our constitutional arrangements. It was beyond improvement. Why on earth we need to start defining that kind of thing in legislation is beyond me. It was a magnificent occasion although, from my perspective, it was also a magnificent defeat. It was the constitution working as it should have done, and we only diminish the constitution by these provisions. But we will come to that later.
I am encouraged by a number of the contributions to this debate that were, on balance, more in favour of acknowledging that this is a fundamental change. Having fewer general elections weakens the electorate—surely we can agree on that. The noble Lord, Lord Brooke, as ever, put forward an interesting tangential view. I agree with him that perhaps the electorate would not give the answer to the question, “How many elections do you want?”, that we might assume they would. They might decide, “We can’t be bothered with another blooming election for quite a few years now”. That is quite possible. However, I certainly think that they should have, as my noble friend said, the right to decide whether, instead of having an election every three years and 10 months on average, there should be one every five years. That, surely, is a fundamental constitutional change. I do not want to misrepresent what the noble Lord, Lord Pannick, said, but I think that he as good as said that, as did a number of other speakers.
I realise that there is a weakness in my amendment, which is what my noble friend Lady Hayter said I might say. It was a pity that she did not go to New Zealand earlier because I would have loved to have heard her views of what the people there felt about changing their electoral system from first past the post and whether it had brought undiminished joy and happiness in the way that people who argue for proportional representation suggest.
Baroness Hayter of Kentish Town
It does bring the likelihood of coalition very much to the fore. Some people favour that and some do not, but undoubtedly in New Zealand the great advantage for those who support coalitions is that abandoning first past the post makes a coalition more likely.
Lord Grocott
I wish even more that we had had the benefit of a contribution from my noble friend and that she had been to New Zealand earlier. Perhaps we should take some advice on that front. However, her fundamental point was that, if you are going to increase the gap between general elections, you should certainly not do so without consulting the electorate.
I do not know whether the noble Earl, Lord Onslow, was supporting the proposal for a referendum but I very much agreed with him on what I think he referred to as the “constitutional madness” of the Government or a phrase of that sort. He said that they have got everything else right—which I obviously do not agree with—but they are getting constitutional reform wrong.
Lord Grocott
Doolally was the word. It is a splendid parliamentary term and I would not disagree with it.
There were many contributions to this debate but the only one with which I strongly disagreed was that of the noble Lord, Lord Marks, as he will not be surprised to hear. From his perspective, he did a good job in trying to persuade us that this is not a fundamental constitutional change, but the balance of the arguments we have heard suggested that it is. The only doubts that everyone has are in relation to there being another referendum, and I freely admit that I would not be absolutely thrilled at that prospect either. However, I hope that this short debate has established in the Government’s mind, even if it has not convinced them, that a lot of people believe that this is yet another major constitutional change. It diminishes the power of the British people by reducing the number of elections. It is surprising that the determination to proceed comes principally from the Deputy Prime Minister, who has made much of the need to reconnect Parliament with the people. How this proposal squares with that is something on which I look forward to hearing an explanation. However, in the mean time, with thanks to everyone who has taken part, I beg leave to withdraw the amendment.
Lord Cormack
Lord Cormack
My Lords, I do not wish to detain your Lordships for long on this amendment. I am conscious that there are other very important debates to come, and I am also aware that there is very important dinner break business.
I tabled this amendment for one simple reason: I am extremely unhappy about the coincidence of elections in May 2015. It seems wrong to have a general election for the United Kingdom at the same time as elections for the devolved Parliament and Assemblies. I feel that very strongly. I have a son who lives in Scotland and I have had considerable experience as chairman of the Northern Ireland Affairs Committee in the other House. I know that in Scotland—and I assume that the same applies in Wales and Northern Ireland—specific and real local issues which are very different from those in the United Kingdom rightly dominate the general election. It seems to me that it would devalue the devolved Parliament and Assemblies to have a plethora of elections on or at around the same date.
I was not an enthusiast for devolution in Scotland and Wales but it has happened. As it has happened, I am very anxious that it should continue to work, and work as well as possible, but I do not believe that it would be assisted by having this plethora of elections on the same day or at about the same time. Since I tabled the amendment, I understand that the Scottish Parliament has decided that it wants to prolong its life by a year. That raises some interesting constitutional issues because there is no second Chamber there to say, “Hold on a minute”. For the Scottish Parliament to prolong its own life, in effect because of what we are doing here, does not do a service to parliamentary democracy either in Scotland or in the United Kingdom in general.
Lord Empey
I am very grateful to the noble Lord for giving way. His very thoughtful amendment is obviously designed to assist the devolved Administrations. There are of course other aspects to the amendment. It would mean that those regions would be in a prolonged state of electioneering for additional months, for obvious reasons, and of course the parties would face additional costs because one election would follow the other. The question would also arise as to whether it would be possible to get the people to come back out again so shortly after being at the polls. Therefore, a series of issues arise here. It is a very thoughtful amendment and I know that the noble Lord has many years of experience in these matters. We are obviously dealing here with very sensitive issues and therefore the Administrations should certainly be consulted to get their views on the ideas that the noble Lord is putting forward.
There is also a possibility that local government elections could collide with some of the elections in certain places. Of course, depending on the circumstances, we also have the ever-present European elections, although they will not clash with that date. I thank the noble Lord for bringing forward the proposal. I think that there should be consultation with those most directly affected to test their views on it.
Lord Cormack
I am grateful to the noble Lord for his speech, rather than his intervention. This is very much an issue that your Lordships’ House should consider, and the Government should give us a very considered response.
There is of course an additional by-product of my amendment. Bringing forward the election by virtually a couple of months would prevent the Prime Minister having the opportunity to prolong the life of the Parliament. That might have the incidental benefit or disbenefit of robbing your Lordships’ House of the ability to reject this legislation, because as it is currently drawn it cannot be subject to the Parliament Act, as we have heard again today. However, that is another point.
I urge the Minister to think very carefully about this. We value our devolved Administrations. Having created them, we have to nurture them, and we have to make sure that the powers they exercise are complementary to the powers exercised by the United Kingdom Parliament and that we do not create unnecessary tension between the devolved Administrations, the United Kingdom Parliament and the United Kingdom Government. Again, I think this is an example of not thinking through sufficiently carefully the consequences of the Bill. More damage has been done by the law of unintended consequences than by any other statute. We are in danger of having another law of unintended consequences. I beg to move.
Lord Howarth of Newport
My Lords, Amendments 6 and 7 in this group, which are in my name, are also intended to try to avert this unhappy clash between elections to the devolved institutions in Scotland, Wales and Northern Ireland and the general election. Mr Mark Harper, the Parliamentary Secretary, giving evidence to the Constitution Select Committee, noted that this clash could have happened anyway under existing legislation. However, the Bill makes it inevitable that the clash will occur in 2015 and every 20 years thereafter, all things being equal. It adds injury to insult. The insult has already been in the Government’s insistence that the AV referendum should be held this year on the same day as the elections to the devolved institutions. They ignored the complaints about that from Scotland, Wales and Northern Ireland, and they ignored the pleas from both Houses of Parliament not to bring about that situation. It is contemptuous of the devolved institutions and those nations.
The Government of the United Kingdom should show better respect towards them. They appear to treat elections to the devolved Parliament and Assemblies as being of no real importance. Yet, the Liberal Democrats, before the general election, proposed that there should be regionally elected assemblies in England, and a number of Conservatives have argued seriously that there should be an English Parliament. Do they believe in devolution? Do they believe that there should be a mutually respectful relationship between the Parliament of the United Kingdom and the devolved Parliament and Assemblies or not? I fear that having the elections on the same day in 2015 and periods thereafter will wreck the devolved elections. Candidates in those elections ought to be judged on their own record and promise in the important fields of government that are devolved and the important political service that they give. They should not be caught up in the backwash of the general election.
Professor Padgett, giving evidence to the Constitution Select Committee, observed that in Germany, where elections take place on the same day, federal issues and campaigns have, as he put it,
“totally engulfed the regional campaigns”.
Dr Milner, also giving evidence at the same session, noted that in Sweden, where national, regional and local elections coincide on the same day, there is high turnout—that is a merit—but that people gave very little attention to the issues in the regional and local elections. On the other hand, in Norway, where regional and local elections take place at mid term of the four-year cycle of national elections, the focus is truly on the regional and local elections when they happen. He also made the worthwhile point that more frequent elections are good for democratic engagement and democratic education.
There will, inevitably, be great confusion if all these elections are held on the same day, fought on different boundaries, possibly on different voting systems and with different campaigns for the different elections. On the administrative side, returning officers have complained that it will be very difficult for them to acquit themselves of their responsibility. Mr Harper said to the Select Committee that the question of coincidence of the dates of the elections for the devolved Assemblies and the general election was a bigger question than the clash with the AV referendum. As of early last November, when he gave that evidence, he said that he was considering what the appropriate solutions might be. He said that,
“we then intend to have a proper consultation process”.
Of course the consultation process should have taken place before the Bill was published. He said that he hoped that an agreed way forward would be implemented in the Bill.
I should be grateful if the noble and learned Lord would give us a report on what has transpired in these consultations and what the Government intend. Is it, as the noble Lord, Lord Cormack, suggested, correct that the Government have been tempting Members of the Scottish Parliament to have their term in office extended to five years, or do the Government envisage that the dates of the elections to the Scottish Parliament and the Assemblies might be shifted to a lesser degree? How can it be that a Government who believe in fixed-term Parliaments are mucking about with the fixed terms that have already been legislated for the Scottish Parliament and the other Assemblies? Will we see government amendments on this? If so, will that be at Committee stage or on Report?
The amendment proposed by the noble Lord, Lord Cormack, is preferable in the sense that it would shift the proposed date of the Westminster elections and does not incommode the devolved elections. My own amendments equally involve some shifting of the dates of the Westminster election and my Amendment 6 would bring it forward to October 2014. If we are to have fixed-term Parliaments there is no reason why we should not have elections in October rather than in May. I look forward to hearing the Minister’s response.
Lord Hunt of Kings Heath
I shall make a short intervention. This has raised an important point. There is no doubt, as was said at Second Reading, that this Bill leads to the real possibility of difficulty every 20 years in the close timing of the Scottish Parliament and Welsh Assembly elections on the one hand and the Westminster Parliament elections on the other. All three elections are specified to occur in May under normal circumstances. I understand that the Government are involved in consultations with the devolved institutions on that issue. It would be useful if the noble and learned Lord could report to the Committee on the progress of those negotiations, particularly if there is any potential for amendments to be tabled at later stages.
The noble Lord, Lord Cormack, and my noble friend Lord Howarth have each put forward a different approach. They may have noticed our Amendment 52, which suggests a third approach. It states that a,
“general election shall not be held within 30 days of a general election to the Scottish Parliament, National Assembly for Wales or Northern Ireland Assembly”.
Today’s debate will be helpful in allowing us to discuss this matter more fully later.
I agree with my noble friend Lord Howarth and the noble Lord, Lord Cormack, that there should be stand-alone elections in the devolved Administrations. As my noble friend pointed out, we know the problem of holding different elections on the same day with different voting systems. I should have thought that it would be foolish to repeat the problem that we have seen in the past. I hope that the Minister will be sympathetic and at the very least update us on the discussions with the devolved Administrations.
Lord Wallace of Tankerness
My Lords, I thank my noble friend Lord Cormack and the noble Lord, Lord Howarth, for tabling the amendments and giving me an opportunity to update the Committee further to what I said on the Second Reading. My noble friend Lord Cormack asked the Government to think carefully about this and I confirm that we have done so. As was indicated from the evidence given by my honourable friend Mr Mark Harper to the Constitution Select Committee, this is an issue that we have considered and on which we have been in consultation.
I have much sympathy for the points that have been made and the underlying purpose of the amendments in trying to separate out the dates of the 2015 United Kingdom general election and the general elections to the Scottish Parliament, the National Assembly for Wales and the Northern Ireland Assembly. As has been indicated, it is not solely as a result of the Bill that a conglomeration—if that is the right word—of elections could happen. Indeed, it would happen only once every 20 years but it so happens that the first time would be in 2015. The Bill has given advance warning. Clearly under the present system, towards the end of the five years for which this Parliament was elected, a decision could have been taken to have an election on 7 May 2015 and there would not have been the opportunity to have the same kind of consideration and consultation that we have had.
One reason why the Government would not favour the proposal in the amendment tabled by the noble Lord, Lord Howarth, is that all three devolved assemblies will not always hold their elections on the same day. I think that it has always happened to date that the Welsh Assembly and the Scottish Parliament have held their elections on the same day, but the Northern Ireland Assembly has not always done so. I can check but I understand that this coming May is perhaps the first time that all three have coincided on the one day. I also take the point made by the noble Lord, Lord Empey, that two months may not be a sufficient gap between the elections, if indeed the purpose of separation is to ensure that one is not overshadowed by the other. Apart from the stresses and strains that two months might put on those who would be in permanent campaign mode, it might be difficult even then to disentangle the relevant issues as to which was devolved and which was reserved to the Westminster Parliament.
Lord Hunt of Kings Heath
I am sorry that the noble Lord, Lord Marks, is not in his place because I presume that on that basis he would argue that, since the proposal might be to extend the devolved Administrations from four years to five years, it should be determined by referendum.
Lord Wallace of Tankerness
My Lords, I do not think that a referendum would be appropriate in those circumstances, not least because people go to the polls on 5 May, which is about six weeks away, and we could not hold a referendum in that time. It is important that people know the term of office of those they elect on 5 May. That is why we wish to bring forward that amendment in Committee. We await the outcome from the Welsh Assembly.
Northern Ireland Office Ministers are conducting separate discussions with the parties in Northern Ireland on this issue and have concluded that it would be better to await the outcome of the combined polls scheduled for May 2011 before taking a decision on whether special provision will be needed for Northern Ireland.
For the reasons I have outlined, and in the light of the fact that we have been working not only with the parties but with presiding officers in Scotland, Wales and Northern Ireland, I hope that the concerns that legitimately motivated these amendments have been addressed, and I invite the noble Lord to withdraw his amendment.
Lord Cormack
My Lords, never has a probing amendment produced more in the way of disturbing information from my noble and learned friend. Anyone who knows him likes him. He is an extremely agreeable man who was rightly very popular in the other place and is clearly popular in your Lordships' House, but if ever there was an illustration of the maxim of my late father that you should think before you do anything, it is the response that we have just heard. We are now going to have discussions in Scotland to see what the implications will be.
Lord Wallace of Tankerness
There are no discussions about what the date will be for what will no longer be the 2015 election. We have said that in the longer term there ought to be discussions to avoid a recurrence of the clash. We are not at the moment prepared to put the Scottish Parliament on to a permanent fixed five-year term. It is about the longer term that there will be discussions, but I make it clear that they will not be with regard to the date for the election that would otherwise have been on 7 May 2015. I hope that my noble friend will agree that that is something that should not be rushed into and that it is proper that there is consultation.
Lord Cormack
Yes, of course, but I respectfully say that there should have been consultation before we got into this mess. As I listened, I could not help but remember a quotation from WH Auden, writing just before the last war, who said that every great drama has two acts. In the first, the mistake is made, and in the second people discover that they have made a mistake. I could not help but think that there is a lot of that here. If only there had been consultation with the devolved institutions first. Then there could have been a proper working out of the most sensible date on which to have these various elections. However, the probing amendment has worked to some degree, and in the spirit of conciliatory unity which is so prevalent in the House today—I am delighted by that—I beg leave to withdraw the amendment.
Transfer of Functions (Dormant Accounts) Order 2010
20:26 - Division on Motion. - Ayes: 102 / Noes: 159 - Motion disagreed.
Lord Hunt of Kings Heath
To resolve that this House regrets that the Transfer of Functions (Dormant Accounts) Order 2010 (SI 2010/2967) makes a very limited amount of money available to the big society bank in comparison to the cuts being made to voluntary organisations and youth services.
Relevant document: 19th Report from the Merits Committee.
Lord Hunt of Kings Heath
My Lords, I make it clear that I support the use of dormant bank accounts for socially useful objectives. It was the previous Labour Government who took through the Dormant Bank and Building Society Accounts Act 2008 to make provision for the Big Lottery Fund to distribute dormant account money to meet expenditure that has a social or environmental purpose. The big society bank clearly originates from those proposals. We proposed then that dormant money would be distributed to meet expenditure on or connected with the provision of services to support opportunities, to meet the needs of young people, to support the development of individuals’ ability to manage their finances, or to a social investment wholesaler. Let me say that we welcome the Government’s decision to continue the work of the social investment wholesale bank. However, it is currently unclear how the big society bank will be set up and on what terms it will receive capital from UK banks. I hope the Government will be able to explain how they will guarantee the social mission of the bank and ensure that it does not become just another mainstream lender.
There are serious questions about how the big society bank will function. What form will the capital from the Royal Bank of Scotland, Barclays, HSBC and Lloyds take? Will it be legally incorporated? What working rate of return are the Government expecting to provide to the banks? What interest rate will the big society bank charge? Will it be allowed to issue bonds and raise additional wholesale finance? What kind of social enterprise will the big society bank favour? Will the big society bank have paid employees? What salary levels will be paid? What bonus structures will be used? When the funds are passed to the community groups and voluntary organisations on the ground, will they represent the total sums of money put into the big society bank?
I also ask the noble Lord what he has to say in response to your Lordships’ Merits Select Committee, which reported on this statutory instrument. He will know that it made the comment:
“The infrastructure of the Big Lottery Fund is already up and running, and using it as a conduit offered potential economies of scale”.
The Merits Committee wanted to know, and invited the House to ask, whether the policy proposals that the Government are bringing forward will result in an additional administrative cost. I would be grateful to the noble Lord for his response to that.
Going beyond the specific questions that I am asking the noble Lord, there is a more substantive issue at the heart of my Motion. In the face of tens of billions of pounds in spending cuts, which are more likely to be cut from public service contracts that impact directly on the voluntary sector—it holds many of those contracts—the limited amount of money that the big society bank will receive is very small beer. In fact, it is hard not to conclude that the big society is a misnomer for what this Government are all about. They are embarking on a destructive assault on our welfare state. It is clear that the voluntary and charitable sectors are taking a massive hit as a result.
Over the past few weeks, I have mentioned the situation of Birmingham on a number of occasions in your Lordships’ House. In Birmingham, the CAB is threatened with closure and it is not alone. Many of the city’s voluntary services are similarly threatened as a result of decisions made by the Conservative-Liberal Democrat council. At the same time, we are seeing large reductions being made in legal aid services. All those decisions will have a dramatic impact on the most vulnerable people living in Birmingham. What is happening in Birmingham is happening up and down the country. Libraries, children’s centres, the youth service and the charitable sector—all are being adversely affected.
When the Government’s big society policy concept emerged, the role of the voluntary sector was said to be crucial. Since then there have been various interpretations of what the big society has meant but I believe, from my reading of the various enunciations from Ministers, that the voluntary sector is still at the core of what it is about. I support and embrace the role of the charitable and voluntary sector.
When Labour was in office we took important steps to support the charitable sector and volunteering. But no one can volunteer at a library, the CAB or a children’s centre if it is closed. No wonder many charity heads have warned that the speed and depth of the cuts imposed by local councils make the big society impossible to deliver. The director of Eaves and the POPPY Project, Denise Marshall, said:
“David Cameron, I get what he’s trying to do … but he needs to understand that groups like mine can’t function without that funding. We can’t go from year to year hoping that people will fill our begging bowls. We have to have proper funding … domestic violence victims don’t storm the town hall saying don’t close down the refuge because they can’t”.
She said that the Government,
“needs to understand that and so do the others who are in charge of this funding”.
That was only four weeks ago. She concluded:
“We are going to really mess up more services and we’re going to make women’s lives more difficult”.
The reality is, as the Association of Chief Executives of Voluntary Organisations has estimated, that the voluntary sector will face a reduction in funding of £1.14 billion this year, rising to £3.1 billion per year by 2014. The Society of Local Authority Chief Executives has said that,
“in the short term, there are real fears that spending cuts will impact adversely on the capacity of the charitable/not-for-profit sector. Far from taking on more, and providing capacity to enable a shift away from the state, it may be able to do rather less”.
Baroness Butler-Sloss
My Lords, I have put down a take note Motion so perhaps your Lordships’ House will permit me to go next. I have to declare an interest as a member of the Merits of Statutory Instruments Committee, which is why I have read this order, which I support. I congratulate the Government and I support them rather more perhaps than the noble Lord, Lord Hunt of Kings Heath, has done.
I have absolutely no intention of suggesting that there is anything wrong with this order, nor do I intend to go outside what might be called the parameters of the order, unlike the noble Lord, Lord Hunt of Kings Heath. However, there are some points and questions that need to be asked within the confinements of this order, which provides for a very sensible amendment of the 2008 Act. The questions that I would like to ask are based on the fact that the present position is very vague and it would be helpful to know rather more as to how this new bank is intended to work.
The present position, under Section 16(1) of the 2008 Act, is that the purpose is to be social or environmental. Under Section 18(1), the distribution will focus on providing places to go for young people. That is one of the main objectives. From what I have read of what has been said recently about the proposed big society bank, neither of those matters has figured. It is important to go back to see what the purpose of the Act was to which this order relates. Is one of the destinations of the big society bank to be providing places for young people to go to? How will the bank apply social or environmental purposes? Who will be the recipients? What will be the spending priorities? How will the bank work as the “social investment wholesaler”—what a terrible phrase—in investing and managing financial intermediaries? What are the financial intermediaries intended to be?
The noble Lord, Lord Hunt of Kings Heath, and the Select Committee on Merits also raised the issue of the additional costs. Undoubtedly, the current structure is set up under the Big Lottery Fund. Consequently, any move to the bank is going to cause some additional costs. How are those going to be met? Is it likely that the administration will be so expensive that the £100 million or more from the dormant accounts—I hope those will provide much more than £100 million—will not cover it? One does not want too much of that spent on the additional cost of this big society bank. I am hoping that those costs can be kept to a minimum, but I am somewhat concerned about the movement from the Big Lottery Fund to this new bank.
I would also be interested to know to what extent, if any, there will be any form of parliamentary scrutiny of the bank’s activities. It would be helpful if Parliament had the opportunity to know what was going on and to express a view. I do not wish to comment on what the noble Lord, Lord Hunt, has said about the wider picture, but we ought to know rather more about how the big society bank is going to work within the confines of the 2008 Act. The debate on the Bill in this House undoubtedly raised considerable expectations and it is crucial that the big society bank should fulfil them.
Lord Newby
My Lords, it is a great pleasure to return to the joys of the Dormant Bank and Building Society Accounts Act 2008. I may be the only person in your Lordships’ House who sat through the entire proceedings of that Bill.
That was a fascinating process because the original purpose of the Bill was to do what the Government plan to do, namely to make the funding available from bank accounts to a new social investment bank—the brain-child of the current leader of the Labour Party. When it became clear that some new funding was available, other members of the Cabinet thought it might be a good idea if they had a share. Therefore, a new purpose was added to the Bill to make expenditure available for the provision of services for young people—Ed Balls’ proposal that every community should have a new youth club. This was the second purpose inserted after the first purpose. The third purpose about financial literacy was inserted by the Treasury because it was fed up that it was not getting a look-in. So we ended up with an Act which was a muddle. It had started with a simple purpose and ended up with three purposes.
The relevance of that to the report of the Merits Committee is that it explains why the Big Lottery Fund has a role in the Act as it is currently set out. If you were going to have, as was originally envisaged, part of the funding going to establish a national network of youth clubs, somebody had to be in charge of allocating the money for those youth clubs. And if you were going to make money available for financial literacy, somebody had to decide where the money went. It was agreed that the Big Lottery Fund was a logical home for that. It was never intended that the Big Lottery Fund would have any role to play in terms of the social investment wholesaler because that is not what it does. I suspect that the only role of the Big Lottery Fund now, given that the first two purposes have fallen by the wayside and we have got back to the original intent of the Bill, is to decide who the social investment wholesaler will be. Someone has to do that, so it has to be either a civil servant or the Big Lottery Fund. I doubt very much whether there will be any additional cost involved with that.
Regarding the original purpose of the Bill, I believe it is extremely important that the big society bank is established. Whether you agree with the cuts or not, it is undoubtedly the case that many public services are being better delivered today than they were yesterday because they are being delivered by social enterprises. I have referred in previous debates in your Lordships’ House to Sandwell healthcare services, which provide facilities in the West Midlands for half the price previously provided by the local authority. I know this because the chief executive came before the All-Party Parliamentary Group on Social Enterprise, which I chair. When asked how Sandwell was able to do that for half the price, he said that nobody is paid any less but some simple things have been done such as reducing the average number of days’ sick leave from 32, when the services were administered by the local authority, to two. He has made huge efficiency savings by motivating staff and freeing them from a bureaucratic environment.
The problem with the social enterprise sector is that it is full of organisations such as Sandwell healthcare services doing tremendous things but on a small scale. One of the main reasons they are not doing things on a large scale is that it is very difficult to get access to finance. Very often social enterprises do not have the business record because a lot of them are relatively new, nor do they have assets against which a loan can be secured. Therefore, the mainstream banks do not lend to them. The big society bank, with the combination of funding from this Act and from the high-street banks, will for the first time provide a significant pool of capital for social enterprises.
As I say, whatever you think about the cuts, having more social enterprises will enable public services to be delivered more efficiently and more effectively than is often done at present. Therefore, I strongly welcome the establishment of the bank. This is a minor order that helps clear the way for that and it has my full support.
Baroness Pitkeathley
I want to speak in favour of the Motion proposed by my noble friend Lord Hunt. I declare two interests. Until 31 March 2011, I am the chair of the advisory body to the Office for Civil Society, which has responsibility for the big society bank. I was also a member of the original Commission on Unclaimed Assets, chaired by Sir Ronald Cohen, so in that sense I go even further back than the noble Lord, Lord Newby.
I want to remind your Lordships of what Sir Ronald said at the time of the launch of the Commission on Unclaimed Assets, which was set up originally in 2005 and launched in 2007. He said:
“As for the money that remains unclaimed, we must never forget that this is neither the Government's nor the banks' property - but the people's money … the money should be spent in order to have the biggest impact possible on deprived communities in Britain”.
Further, it was pointed out that,
“the unclaimed asset funds could help to create new and profitable investment opportunities within local communities”.
That was the spirit of the Commission on Unclaimed Assets and its purpose was that it would support the local voluntary and community sector. If that was the purpose then, how much more important is that purpose now when, as we all know, the voluntary and community sector is somewhat in difficulties because of the withdrawal of funding?
Lord Beecham
My Lords, I must apologise for not being in the House when my noble friend Lord Hunt opened this debate, especially as he was kind enough to make reference to me subsequently—although I did hear that.
I want to take up one point, on which my noble friend Lady Pitkeathley touched almost in passing, while welcoming the principle of the order and of the bank and recognising that there is certainly some potential for helping the voluntary and community sector. She mentioned in general the terms under which investments and loans will be made. Can the Minister give us any assurances about that? Sir Ronald Cohen, who is a very enthusiastic supporter of the principle, has suggested that interest will be at commercial rates. If that is the case, is there not a danger that voluntary organisations, which after all will be seeking investment anyway because they are having some financial difficulties, will find it difficult to proceed when they are being expected to pay commercial rates of interest on loans? It would be different if grants were being made, but my understanding is that this is to be a rolling investment fund and that it will be a question not of grants but of loans. It would be helpful if the Minister were able to give an indication on that issue.
Lord Taylor of Holbeach
My Lords, I am sorry if my slowness in rising rather gave the impression that the debate would be longer than I had imagined. I am not reluctant to spring to my feet for I believe that this is a very welcome debate and thank all noble Lords who have participated in it, in particular those two noble Lords whose Motions are before us this evening, because it gives me an opportunity to expand further on the Government’s plans and actions deriving from the order which is the debate’s subject.
The noble Lord, Lord Hunt, has expressed concern over the current challenges facing voluntary, community and social enterprise organisations. I share the view that the VCSE sector plays a crucial role in our society and economy, but as I will make clear in these closing remarks, the big society agenda, with its emphasis on social action, community empowerment and public sector reform, will open up many new opportunities for these organisations to thrive in the future. This Government are taking a number of measures which will directly support the sector through this difficult time in the short term, but which will help to ensure a more secure and stable future in the long run. Those measures include the setting-up of the big society bank.
I join the noble and learned Baroness, Lady Butler-Sloss, in welcoming the coming-into-force of the transfer of functions order. As the noble Lord, Lord Hunt of Kings Heath, will know, and as he said, this derives from legislation enacted under the previous Government which we supported. It marks an important step on the way to meeting the Government's ambitious plans for a big society bank. With this order, the Minister for the Cabinet Office can now direct the Big Lottery Fund on how to use England’s portion of released dormant accounts to achieve social benefits in line with the provisions of the Dormant Bank and Building Society Accounts Act 2008.
As the Prime Minister announced in July 2010, the Government intend to use all the dormant accounts money available for spending in England to capitalise an independent big society bank, or—I apologise to the noble and learned Baroness for the phrase—social investment wholesaler. The role of the big society bank will be to help build a sustainable social investment market, making it easier for voluntary, community and social enterprise organisations to access the finance and advice that they need. Although a nascent social investment market has emerged over the past decade, it remains small and fragile. Many of these organisations tackle our most intractable social problems and deliver vital public services. They empower local communities and work with the most marginalised members of society, yet still struggle to access the finance they need to grow and develop.
The big society bank will work with a range of social investment intermediaries to increase the overall pool and variety of capital available to front-line organisations. In the long term, our vision is of a fully functioning and more sustainable social investment market which will enable voluntary, community and social enterprise organisations to grow and develop, and to become more resilient.
There are many ways in which the bank will work to achieve this. For example, I believe that there are people and organisations, including the public sector, willing to invest in social impact. There are also organisations trying to create that social impact but few mechanisms to bring the two together. Some new ideas include social impact bonds, community bonds and community share schemes. One of the things the big society bank might do is support innovation, particularly proposals that find new ways of matching the needs of front-line organisations with potential providers of capital.
There are also organisations—community groups, social enterprises, charities—which are viable businesses but are unable to access working capital or capital to buy new assets from commercial banks. The big society bank could increase the flow of capital via intermediaries which specialise in affordable loans to these institutions. And for organisations which are looking to expand and grow, the big society bank will look to increase the availability of risk capital, where the investor takes a stake in the future success of the organisation.
In refocusing the priorities of dormant accounts allocation, we are not downgrading the importance of youth and financial inclusion. We would like the bank to include both themes within its investment mandate and believe that far better outcomes can be achieved through the social enterprise and community-led solutions that the bank will support. I am grateful for the support of my noble friend Lord Newby and the noble learned Baroness, Lady Butler-Sloss, in recognising that the Government’s proposals build on the original Act in a positive way.
We recognise that the current economic situation and the need to tackle the deficit create a challenging and sometimes painful environment for many organisations, including those in the voluntary, community, charitable and social enterprise sectors. We also understand that organisations might have difficulties managing the transition to a tighter funding environment and getting to a position where they can take advantages of the future opportunities presented by the big society agenda. This transition is more difficult in an environment than either the Government or the previous Government would have wished.
This is why we have set up a £100 million transition fund to give a lifeline to those VCS organisations that are delivering front-line services and are affected by reductions in public spending. The fund provides grants of between £12,500 and £500,000 to help organisations make the necessary changes in order to thrive in the long term and take advantage of the opportunities presented by the big society and public service reform. Already, following a large number of applications, 18 early transition awards have been made and many hundreds more will be announced in the coming weeks and months.
We will also shortly be announcing a programme of work to give front-line organisations access to support and expert advice beyond funding matters that will enable them better to meet their changing needs. We also want to help the sector access a wider range of funding to increase its strength and resilience for the long term. That is why we are aiming to capitalise a big society bank to increase levels of capital investment in the sector and we are also reviewing ways to incentivise further philanthropy and charitable giving. We are committed to opening up public sector delivery so that voluntary, community and social enterprise organisations can compete for national and local government contracts and access a greater proportion of government spending.
We have established a red-tape taskforce, chaired by my noble friend Lord Hodgson of Astley Abbotts, to remove the barriers that get in the way of sector involvement. It is looking at a range of issues that we know cause difficulties for voluntary organisations, including charity law, licensing, insurance and funding, and will be reporting in May. We have also introduced new powers to help communities save local facilities and services threatened with closure and give the communities the right to bid to take over local state-run services.
We are working hard to set up a big society bank. Not surprisingly, this is a complex process. None the less, by April of this year, we aim to have arrangements in place so that we are able to start making early investments as soon as the first round of dormant accounts money becomes available in the summer. It will take longer for an independent big society bank to be set up and fully operational but we are already in the process of seeking the state-aid approvals necessary to capitalise it with dormant accounts. We have been delighted that Sir Ronald Cohen, previously head of the Social Investment Taskforce, and Nick O'Donohoe, formerly head of global research at JP Morgan and head of its social finance unit, have volunteered to develop a proposal for an independent big society bank. We look forward to working with them and other social investment experts. In addition to the investment from dormant accounts, as the Prime Minister announced on 9 February as a part of a broader package, four of the UK's largest banks have agreed to invest a further £200 million in a fully fledged big society bank. We expect that the final bank will be a lean organisation, and I assure this House that we are conscious of the need to keep any administrative costs to an appropriate level.
In this way, with the combination of dormant accounts money and the support of the banks, we expect that the big society bank will be capitalised with at least £300 million over the next two years, with further injections of capital as more money is released from dormant accounts. This is a significant sum, especially when we consider that in 2010 the entire amount of social investment in the UK was less than £200 million.
In addition, we expect that the bank will attract increasing levels of private sector investment over time, generating hundreds of millions of pounds for charities, social enterprises and voluntary groups, and creating a strong, vibrant and sustainable social investment market in the future.
I will try to answer some of the questions that noble Lords have asked. The noble Lord, Lord Hunt of Kings Heath, asked whether the bank would be able to raise capital, what rates it would set and the salary levels. The big society bank will be able to raise capital although it is unlikely to be able to do so in its first few years. The details of the BSB investment will be decided by its management. They will have to be demonstrably in keeping with its social mission. Salaries will be set in line with the sector, but I know that Sir Ronald Cohen and Mr O'Donohoe are giving their services free to the project to set up the bank.
The noble Lord also asked what form capital from the bank will take. That is being negotiated with the banks and we want to ensure that the terms enable the BSB to deliver its social mission. How will the social mission be guaranteed? The BSB is being set up as an independent, non-public organisation, but we have made it clear that we will direct dormant accounts only to organisations that have a clear, protected social mission in their founding articles, and governance accountability arrangements to protect that mission.
Rather predictably, the noble Lord also asked about the citizens advice bureau in Birmingham, because we have debated that in another context and I suspect that we might debate it further. Perhaps I can put that decision in context. As the noble Lord will know, the Government have a strategy for basing these decisions at a local level. Many councils have made substantial savings through increasing efficiency in back-office functions rather than passing on cuts to the VCSE groups which, as the noble Lord admits, do excellent work. The Government have set out reasonable expectations of councils, challenging them to work with the sector and organisations and not to pass on disproportionate cuts. We expect that from local government throughout the country.
The big society is not a cover for cuts. The challenge that we face in terms of public finance cannot be ignored, but the big society was an approach developed before the recession which is at the heart of the Government's programme of reform. The big society will give individuals and communities a role in shaping the provision of services and give more power to communities rather than central government.
The noble and learned Baroness, Lady Butler-Sloss, asked particularly about parliamentary scrutiny. The aim is for the big society bank to be independent in order to have flexibility to respond to the market, but our key criteria for directing BSB money include robust governance and accountability arrangements, which will include the principle of transparency. Parliament will, in the normal way, be able to scrutinise government spending directions of dormant accounts and in that way scrutinise the whole function of the big society bank as the recipient of those funds.
The noble Lord, Lord Newby, said that in many ways the Government had gone back to the original Bill, and showed how the social enterprise sector can be an effective deliverer of community services and how these proposals will provide much-needed funding.
The noble Baroness, Lady Pitkeathley, asked a number of questions, but I can reassure her that the whole purpose is to use this money—people's money, as she said—to support the voluntary, community and social enterprise sectors. She is right that the big society bank is not the whole solution, but it is part of the development of this sector, which I know she believes in greatly.
The noble Lord, Lord Hunt of Kings Heath, seeks in his Motion to place the Government’s proposals in the context of the spending review and ignores the state of the public finances under the previous Government, which made budgetary reduction a vital part of the coalition’s strategy for rebuilding the economy. He has also chosen to ignore not just the degree to which the Government have sought to protect the VCSE sector but the measures, of which this is part, to provide it with the opportunity and ability to play its part in reshaping the economy for the future.
This has been a useful debate and I hope that I have been able to reassure the House that this instrument is being used to positive effect. I would like to thank the noble and learned Baroness, Lady Butler-Sloss, for tabling her Take Note Motion and her support of the order. In the light of this, and my comments, I hope that the noble Lord, Lord Hunt of Kings Heath, will feel able to withdraw his Motion of Regret.
Lord Beecham
Before the noble Lord sits down, will he comment on the rate of interest that the bank might be deploying and whether it is likely to be a commercial rate?
Lord Taylor of Holbeach
The bank will be operating in the market, and it is unlikely that the bank is going to be able to provide finance at a subsidised rate. None the less, the most important thing to secure is the availability of the funding. That is the direction of travel of the bank at this time.
Lord Hunt of Kings Heath
My Lords, I am very grateful to the noble Lord, Lord Taylor, for his response and for some of the details he gave to noble Lords. However, from what he said, it seems that it will be some months before money starts to flow and the amounts seem likely to be modest. His contribution was, as ever, meant to be as constructive as possible—until at the end when we heard from him about the deficit and the financial position of the public sector. He made no mention of the global financial context in which the last Government had to move to protect the economy. Also, the Government do have a choice—they can slavishly carry on as now, or, as I hope, they can take steps to deal with faltering growth in our economy; establish a plan to create jobs in the private sector to deal with the crisis of youth unemployment; and take steps to support the voluntary and charitable sector.
I appreciated the comments of the noble Lord, Lord Newby, and his tour de horizon on the passage of the 2008 Act. I agree that social enterprises are invaluable and that we want to support the sector. I also agree with his point about access to finance. However, as my noble friend Lady Pitkeathley says, the voluntary and charitable sector is running short of cash now. At the very least, it needs an injection of resources and time to adapt. As my noble friend Lord Beecham suggested in his question about commercial rates, that is highly pertinent. I know that access to capital is an issue, but when very little revenue is available from traditional sources of funding, the cost of capital becomes a major inhibition on the very organisations the noble Lord is relying on.
The noble Lord is ambitious for the future, for the proposals contained in the order and for the role of the voluntary and charitable sector. I applaud that ambition. However, many of the organisations on which he wants to rely are not going to survive. That is why I continually come back to the situation of the CABs in Birmingham. Of all the organisations on which one would have thought the Government would have depended to provide that kind of infrastructure support, I cannot think of a more important organisation than the CAB. Indeed, that is why in the Public Bodies Bill we are seeing the CAB being asked to take on the responsibilities of a number of consumer organisations. How can the Government say they are supporting and relying on the sector when a key part of that structure in this country’s second city is under threat of complete closure?
I respect the noble Lord, Lord Taylor, enormously. We support the use of dormant accounts but the context in which we find ourselves is that the very organisations on which the Government depend so much are being obliterated by the impact of the cuts taking place. I commend the Motion.
Transfer of Functions (Dormant Accounts) Order 2010
Baroness Butler-Sloss
That this House takes note of the Transfer of Functions (Dormant Accounts) Order 2010 (SI 2010/2967).
Relevant document: 19th Report from the Merits Committee.
Motion not moved.
Fixed-term Parliaments Bill
(13 years, 1 month ago)
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Lord Howarth of Newport
Lord Howarth of Newport
My Lords, I hope that Amendments 5 and 9A will be of some interest to the House. They would introduce a flexibility to hold a general election at any time in the fifth year of the Parliament. Amendment 5 deals with this particular Parliament and Amendment 9A deals with subsequent Parliaments. They still provide for Parliament to be fixed, but with flexibility between four and five years. They recognise that there are important objections to the term of Parliament being fixed for a full five years. The objections, which have been explored in our debates earlier in the day, are that accountability is diminished, that elections would take place less frequently, that the accountability of Members of Parliament to electors is therefore reduced and that the accountability of the Government to electors is reduced. Furthermore, if you insist on fixing the term of Parliament for a full five years, you are liable to find that you require an exhausted Government to totter on into a fifth year and probably expire at the end of it.
My amendments also recognise the widespread view within our political culture that, assuming that a Parliament is still viable, for the Prime Minister to call an election before five years are up is opportunistic, exploitative and an abuse. On the other hand, it is widely accepted that to call an election after four years have passed is acceptable. We saw that in the Parliaments of 1979-83, 1983-87, 1997-2001 and 2001-05. I do not think that anybody complained when either Mrs Thatcher or Tony Blair called an election after four years on those occasions. It was regarded as entirely within the reasonable understanding of our constitution.
These amendments would allow a continuation of the four-year norm—it has been typical that Parliaments have lasted for around four years in the post-war period— while respecting the principle of the five-year maximum which was legislated for in 1911. When Mr Asquith proposed that legislation in 1911, he envisaged that while there would be a maximum of five years the probability would be that elections would tend to take place some time around the end of the fourth year, or not long thereafter. That was prophetic and has proved indeed to be the case. These two amendments would simply institutionalise what has become convention and practice and, on the whole, has been found to be satisfactory by the people of this country. I beg to move.
Lord Brooke of Sutton Mandeville
My Lords, I shall be extremely brief but I told myself that if anybody else brought Mr Asquith into the debate yet again I would take advantage of his reappearance to make a single point. In the Earl of Oxford and Asquith’s memoirs, he describes the debate within the Liberal Cabinet in the period leading up to the First World War in relation to the Marconi scandal in which the then Attorney-General was somewhat embarrassed by his behaviour. I think that it was on the issue of shares. I am astonished that the Prime Minister put this into his memoirs, but the outcome of the Cabinet discussion was that they were at no real parliamentary risk because it was absolutely clear that the Conservatives would be too stupid to take advantage of it. There was one dissenting voice, which was Winston, who had of course once been a Tory.
The Opposition say, again and again, that the purpose of the Bill is to provide glue in the coalition relationship. In responding to that, remembering what had happened in Asquith’s Cabinet, I asked myself, “Is it really because they want to be helpful to the coalition that they go on repeating this?”. I recall in the process C S Lewis’s happy remark that if you hear about someone going around doing good to others, you can always tell the others by their hunted look. It occurred to me that there was some degree of overlap between the argument that we need a Parliament shorter than a five-year one and the Opposition’s view, set out during the passage of the Parliamentary Voting System and Constituencies Bill, that it would be helpful if the country had the opportunity of expressing its opinion at the earliest possible opportunity, when it so happened that there might have been some degree of parliamentary advantage to the Opposition in that happening. I hope, diffidently, that as the Bill progresses we will not have suggestions made in either direction that we are all engaged in this for short-term parliamentary advantage or that we are all concentrating totally on the good of the nation and the constitution.
Lord Hunt of Kings Heath
My Lords, that was an interesting and helpful intervention. Anyone who has read David Laws’s book on the negotiations between the coalition parties will find that the coalition parties did not meet the test that the noble Lord, Lord Brooke, has set. On page 98 of that highly readable tome, Andrew Stunell pointed out to the negotiating team that,
“trust and confidence was very important to us, and that we wouldn’t want to find the PM calling an election at a time that did not suit us. ‘That works both ways!’ said William Hague. We mentioned that our own policy was for four-year, fixed-term parliaments. George Osborne made the point that five-year parliaments were better, as they allowed governments to get into implementing their plans before having to start worrying about the timing of the electoral cycle. We made no objection to this, and Britain was on its way to five-year, fixed-term parliaments for the first time in its history”.
So much for principle.
Lord Brooke of Sutton Mandeville
I was not making any comment on the course of events. I was simply saying that interventions periodically from the Opposition Benches on this subject might have had a degree of self-interest.
Lord Hunt of Kings Heath
I do not recognise that at all. It is tempting to mention Mr Asquith, if only to encourage the noble Lord to make further enjoyable interventions.
There are two issues here. We are changing our system and we believe that the change from four to five years will be damaging to our constitutional arrangements. Extending the elections by, in practice, around one year will distance people from the politicians. The debate before the dinner break on the issue of the devolved Administrations was very interesting because it highlighted the principle of unintended consequences of the noble Lord, Lord Cormack. It is likely that, as a result of this legislation, the term of office in Scotland and Wales, and possibly Northern Ireland, will be extended to five years. That must be the clear implication of what the noble Lord said. I am glad to see that the noble Lord is in his place. He argued that we should not have a referendum on this Bill because, although under the Bill the term of the Parliament will be fixed at five years, that will not be outwith the limit in the current legislation. However, in relation to the devolved Administrations, moving to five years will go outwith the current primary legislation. I hope that there will be a referendum on that proposal if it comes before Parliament.
My noble friend has raised the very interesting and ingenious proposition that four years should be the norm while respecting the principle of a five-year limit. He deserves a comprehensive response from the Minister.
Lord Pannick
Before the Minister responds, I should like to add my response to these amendments and, indeed, to so many of the thoughtful amendments to Clause 1 that have been tabled. They tinker with a fundamentally misconceived concept of a fixed-term Parliament, as was explained by so many of your Lordships at Second Reading. As we have already debated this afternoon, Clause 1 is driven by the short-term political considerations of the coalition and will reduce the effective power of the electorate to have their say about those who govern them. I am coming to the view that the correct approach is for this House to agree that this Parliament should last for five years—that will deal perfectly adequately with the short-term political needs of this Government—but refuse to accept that we should legislate for any future Parliament. After this Parliament, the normal, traditional procedures, which have worked very well, should continue. I very much hope that on Report we can decide that that should be the case.
Lord Martin of Springburn
My Lords, I have a worry about the idea of a five-year Parliament. My experience of the other place was that when there was a four-year Parliament, although there were arguments between Back-Benchers and their own government leaders—the Executive—and between parties, at least the electorate had an opportunity to sort the matter out. They could decide who would be the next Government. Now we are proposing to have five years.
If my memory serves me correctly, during the time that I was in the House of Commons, there were two occasions when the Parliament went the full five years. The last Parliament went five years, and there are no two ways about it—in that last year, the electorate were not getting value for money, if that is the right way to put it. There was very little going through the House. Some may say that that was the fault of the Government for not finding legislation to put through the House, but it is a problem with the whole House. The electorate are entitled to better.
It is not the first time during my political lifetime that I have heard criticism of the great trade union barons, although there are none any more. The railway industry, which was traditionally the main industry in my area, employed 12,000 people in my constituency. You can imagine the numbers working for the railway industry throughout the country. The same went for the steel-working and engineering unions. Perhaps I should declare an interest: I am a card-carrying member of my engineering trade union. Maybe I am digressing, but this is a valid point: if any trade union leader had said, “By the way, I am going to have an extra year of office and I’m not going back to the membership about it”, there would be criticism on the Floor of this House and in the other place.
On the five-year term, we know that an arrangement has been made by the Conservatives and Liberals. I do not want to criticise that, but where arrangements are made there can be fall-outs. What kind of situation will we have if members of the coalition start falling out with one another? There are better scholars of history than me, but I got an opportunity to read some of our great country’s naval history. It turns out that Captain Bligh and Fletcher Christian were pals when they got on board but, after that long voyage, they fell out with one another. That could happen with the Liberal Democrats and the Conservatives—they, too, could start to fall out with one another.
I have another point to make concerning the practicalities of a five-year Parliament. I noticed that on a Thursday in the House of Commons—noble Lords can check the records; they have no need to take my word for it—there were debates but no votes. The party managers arranged it that way. It was clear that after Prime Minister’s Questions Members of Parliament went back to their constituencies, where they were working hard. Perhaps they were a bit worried about the people in their constituencies who were attacking them. I remember Tam Dalyell, who was an excellent mentor. He would say to me, “Michael, you are elected to Westminster. You are elected by your constituents to be in Westminster and you shouldn’t be seen in the constituency while Parliament is sitting. You should be in Parliament. You are the only person in your constituency who can get to those green Benches, and you should do so”. However, that was not happening, and the five-year Parliament was part of the reason.
I have seen MPs promoted to ministerial posts. They have been bubbly and full of enthusiasm, and they have taken to the Dispatch Box like a duck to water. Then the Prime Minister of the day would have a reshuffle, and the Minister who was so pleased to take a portfolio from the Prime Minister was not too pleased when he lost it. He would call the Prime Minister of the day every name under the sun. When I heard that, I would say, “He wasn’t too bad a man two years ago. You liked him then. I heard you say so, but you don’t like him now”. Therefore, the handing out of gifts went only one way so far as some Ministers were concerned—they felt that they should be given the portfolio but not have it taken away. That brought about what was known as the ex-Ministers club, and with a five-year Parliament it is going to have a lot of members. The reality is that the Prime Minister of the day has to get fresh blood in because, if he does not, there will be a gnashing of teeth in the ranks. Therefore, others have to be pushed out and return to the Back Benches.
I may have spoken for too long, as I know that we have other amendments to consider. Regarding the five-year Parliament, I can only say to my noble friends on the Liberal Democrat Benches that it is happy days for them now. Some of their colleagues have ministerial jobs and they are all as happy as Larry. However, I go back to Fletcher Christian and Captain Bligh: there will be fall-outs, and that five years may end up being a millstone round their necks.
Lord Norton of Louth
My Lords, I share the view of the noble Lord, Lord Pannick, but I am motivated to follow the words of the noble Lord, Lord Martin. There is a great deal in what he has said. When you look at Parliaments that have lasted for five years, they tend to suggest that it is very difficult for a party to generate a coherent programme of public policy that is sustainable over a full five-year period. By the time you come to the fifth Session, the Government tend to have moved from being a Government to being an Administration. They tend to be very reactive; they are deskbound; they are not generating policy; and they are certainly not pursuing the programme that they placed before the electors at the general election. There will be certain dangers if a Parliament is dragged out artificially for a particular fixed term. Electors should be given the opportunity to have a say before then if the Government have clearly run out of steam. Therefore, there is merit in what the noble Lord, Lord Howarth, is proposing, which is to inject an element of flexibility to take care of that very point.
Lord Tyler
We should be absolutely clear what precisely the amendments in the name of the noble Lord, Lord Howarth of Newport, would do. They would put back into the hands of the Prime Minister of the day, the leader of one of the political parties, the opportunity to pick a good moment to alter the general election date for party advantage. That is the precisely the way in which these amendments could fulfil their purpose. For that reason, they should be firmly opposed.
Lord Martin of Springburn
Can I make the point that going beyond four years can be a double-edged sword for a Prime Minister? Margaret Thatcher was very shrewd in how she went after a strict four years, as was Tony Blair. We have seen what happened with five years, so it does not always work in a Prime Minister’s favour.
Lord Cormack
I make one brief point following the comments of the noble Lord, Lord Martin. Surely in a coalition Government the Prime Minister could not do what his partner, the Deputy Prime Minister, did not wish him to do. So why are we here?
Baroness Stowell of Beeston
I want to repeat a point I made on Second Reading, which does not seem to have been raised so far today. I do not bring any preconceived ideological support for fixed-term Parliaments. The Bill is a positive step to address the lack of public confidence in the political system. One of the points I made on Second Reading, which is the most powerful reason to support the Bill, is that it would ensure that the Government and the Opposition had to face the electorate on a predetermined date, whatever the political conditions are at that time. That is the most compelling thing about fixed-term Parliaments. As to the length of the term and whether it should be four or five years, I was struck by the remarks of the noble Lord, Lord Armstrong of Ilminster. He made the point about Governments being distracted by preparing for elections and said that if there were to be a fixed-term Parliament, in his view as a former Cabinet Secretary, it should be five years.
Lord Grocott
We need to address the point made by the noble Lord, Lord Brooke, which as ever was entirely valid, about the extent to which we all tend to cover our party advantage with the cloak of great constitutional principle. That is obviously a criticism that we need to take seriously. The way in which to leaven that a little is to ask ourselves, whichever side of the argument we are on, whether we would take the same position of “principle” if we were on the other side of the House. I readily ask that question of myself, having spent a fair chunk of my parliamentary life in government—not as a Minister but in supporting the Government—and a fair chunk in opposition. If I find, as we all do from time to time, that I am in danger of adopting different positions in government and in opposition—which I must say I have seen to be spectacularly the case with one or two who are now in government—we ought to ask whether it was a great constitutional principle or party advantage. I try to test that myself and I have no doubt that I frequently fail, as I freely admit that I do not readily support a constitutional principle that I know would damage the Labour Party. That is where I am.
However, I ask the Government whether, if there were a Labour majority of one after the next general election, which they want to be in 2015, would they with the same passionate, principled enthusiasm say that it is essential that that Government remained in power for five years? That is the question the Government need to ask themselves. If they can say with certainty and conviction that the answer is yes, then obviously I will accept their argument and their integrity on that basis and will live with it, but I think they will find that a pretty tricky question to answer.
The Advocate-General for Scotland (Lord Wallace of Tankerness)
My Lords, again this amendment has stimulated an interesting debate, some of which goes into the general principles of fixed-terms Parliaments and some of which foreshadows the later debate we will have on the figure of four or five years. The amendment would omit the date of 7 May 2015 and provide instead that the next parliamentary general election should be held within a range of four to five years after the previous general election. In other words, we would be looking at an election held no earlier than 6 May 2014 and no later than 6 May 2015.
As my noble friend Lord Tyler very succinctly put it, that drives a coach and horses through the whole concept of a fixed-term Parliament because it would put back into the hands of the Prime Minister the option of choosing the date of the election which those of us who have supported the concept of fixed-term Parliaments want to move away from. I say to my noble friend Lord Cormack that it would quite easily be resolved because the Prime Minister could do so only if he had the agreement of the Deputy Prime Minister. It would be in the very circumstances where the Deputy Prime Minister and the Prime Minister fell out that the chances would be that the Prime Minister would want that option—the circumstances perhaps more graphically, from a literary perspective, expressed by the noble Lord, Lord Martin of Springburn. As my noble friend Lady Stowell said, the important point about fixed-term Parliaments is that the Government of the day have to face the electorate on a predetermined date regardless of the prevailing political circumstances.
Asquith was quoted. I have read this quote several times, and I am glad that the noble Lord, Lord Howarth, did quote him because it gave us the benefit of the intervention by my noble friend Lord Brooke. We can have a quite legitimate debate about what Mr Asquith was saying on 21 February 1911. He said that reducing the Parliament from seven years, as it previously was, to five years would,
“probably amount in practice to an actual legislative working term of four years”.—[Official Report, Commons, 21/2/1911; col. 1749.]
He did not say that the term would be four years, but that legislative working term would be four years. That reflects the comments referred to by my noble friend Lady Stowell that were made by the noble Lord, Lord Armstrong of Ilminster, at Second Reading. I readily concede that he has misgivings about the idea of fixed-term Parliaments, but he said that if we have them, he prefers five years rather than four years because:
“Even with a term of five years, that shadow extends over the last year of the term and tends to reduce to no more than four years the period during which government policy-making and parliamentary debate can effectively be pursued without too much looking over the shoulder at electoral considerations”.—[Official Report, 1/3/11; col. 971.].
His concern is that if we have a four-year fixed term, it would kick in at the end of three years. Obviously, if we are going to have even more prelegislative scrutiny in the first year, that shrinks the time available to Governments to deliver their programme.
My noble friend Lord Norton, the noble Lord, Lord Martin, and others have indicated that our recent experience of Governments who have gone for a fifth year has not necessarily always been happy. In many ways, that almost makes the point. The only reason those Governments limped on during the fifth year was that it was not propitious or opportunistic for the Prime Minister of the day to call an election after four years because he thought he was going to lose. If you have a five-year fixed term, clearly Governments can plan for those five years. It may well be that they can do more prelegislative scrutiny in the first year. There will inevitably be an election looming at the end of the fifth year, but you are more likely to get proper planning for five years and a Government not having to go for the fifth year because they do not think it opportune to go at the end of four years.
Lord Martin of Springburn
I am at a loss to understand why the Government do not go for four years. Another feature about a fifth year is that everyone will be in the doldrums. Members of Parliament will not stay in the Chamber. They will be campaigning in their constituencies. That will be a problem in the fifth year. I know that some noble Lords are muttering and I do not want to go on for too long because I was accused on the radio of filibustering not so long ago, which was not true. My point is that, if there is legislation in the fourth year, Members of Parliament will stay because of their duty to vote, but if there is nothing doing in that final year, they will be campaigning in their constituencies.
Lord Wallace of Tankerness
My Lords, with all due respect, the noble Lord makes the mistake of trying to impose on a new situation of a five-year fixed-term Parliament the problems that have arisen under the existing system. Clearly, if a Government are elected for five years, and they know that it is a fixed term and that they will not have to make a calculation at the end of three and a half years or four years on whether they should go to the country, they can plan their legislation properly for the five years. Parliament’s committees can plan their programme of work for five years in terms of bringing the Government to account. It is wrong to take the experience of an existing system, which I would argue is one of the problems of the existing system. A Government might not think that they can cut and run after four years and will limp on into the fifth year. Where there is a fixed term for five years, the Government could plan for five years, subject only to overriding circumstances, which is why we have the escape-hatch mechanisms as set out in Clause 2.
I also take the point made by the noble Lord, Lord Pannick, which I would link to my answer to the noble Lord, Lord Grocott. He says that this Parliament should see its five years through and that it was elected for five years. As perhaps was suggested by the noble Lord, Lord Martin, we would not act like some trade union baron—he said that the trade union baron would not do it and that he would be criticised if he did—and try to get more time than we were elected for. This Parliament was elected for five years, as I indicated in an earlier debate. The next election could take place as late, I think, as 11 June 2015, so there is no question of this Parliament trying to take extra time unless there were overriding circumstances, whether it be two months for, say, a foot and mouth outbreak.
We are also proposing that future Parliaments should be for five years. Clearly, no Parliament can bind a successor, which is a position that we recognise. I would say to the noble Lord, Lord Grocott, I believe in fixed-term Parliaments. Who would predict the result of the next election this far out? There is no guarantee that the Government will involve my party or the Conservative Party. It may well be a Government of the Labour Party. I am prepared to say that, yes, I believe in the fixed-term Parliament. If it was a Government of the Labour Party that was to last five years, that would be the right thing to do. Having believed in the concept of fixed-term Parliaments, I am prepared to accept that that could be a consequence. I hope that the noble Lord will take that in the good faith in which it is offered.
I cannot accept that this is a fix for this coalition Government, because we will not necessarily be the Government after 2015. Clearly, we will want to fight our case as best we can. The Conservative Party will undoubtedly want to get as many seats as it can. We as Liberal Democrats will want to get as many seats as we can. Who knows what the outcome will be? At this stage, who knows what electoral system the election might be fought on? It would be impossible to predict. The principle of supporting the fixed-term Parliament means that what is sauce for the goose must also be sauce for the gander and I readily accept that.
I believe that to adopt the amendment as proposed by the noble Lord, Lord Howarth, would completely undermine the whole principle of having a fixed-term Parliament. It would reintroduce the opportunity for the Government of the day in that final year to choose the most opportune moment to go to the country. My noble friend Lord Lawson in his book, The View from No.11: Memoirs of a Tory Radical, said about the then Prime Minister, now the noble Baroness, Lady Thatcher:
“Her view was that a Government should always wait until the final year of the quinquennium, but once there should go as soon as it is confident it will win”.
Clearly, the judgments of the noble Baroness, Lady Thatcher, in 1983 and 1987 were absolutely right as far as the Conservative Party interest was concerned, but it underlines the fact that it was a question of going when it was politically opportune to do so. That is what this amendment takes away from the Prime Minister of the day and that is why I urge the noble Lord to withdraw it.
Lord Norton of Louth
My Lords, the logic of my noble friend’s argument is that a Parliament might go for a full five years and a Government will have a programme for at least a full four years. Does he think the empirical evidence is there to support that?
Lord Wallace of Tankerness
Is my noble friend asking whether it is impossible for a Government to devise a programme for five years? Perhaps I have misunderstood the question.
Lord Norton of Louth
A Government who come in will have a programme for four years with the fifth year spent preparing for the election. I am asking the Minister whether he thinks there is the empirical evidence to support that Governments come in and have a full programme to cover four sessions.
Lord Wallace of Tankerness
If this Bill becomes law and there is a five-year Parliament, the Government of the day can expect to be there for five years and therefore can plan their programme over a five-year period. They need not necessarily frontload the parliamentary programme. It may allow more opportunity for pre-legislative scrutiny, which is regularly being encouraged. That is a difficult issue in the first year of a Parliament when Governments clearly want to move on and do some of the things they were elected on. But if they know that there is a five-year fixed-term Parliament, there is a better opportunity to programme it.
If it was a four-year Parliament, the final-year problem described by the noble Lord, Lord Martin, would kick in in the fourth year, with people going back to their constituencies because they knew an election was looming. Therefore, the effective period of a Government’s programme would be much reduced. If you have a five-year period it will be possible for a Government to plan that programme over five years. We are talking about annual Sessions beginning in May. At the moment the final Session tends to start in late November and has to wind up in late March. I do not think any of us who saw the wash-up last March found it a particularly edifying experience. One would hope that if a Government knew that the final Session was starting in May and going through to a solution the following late March, that would allow for a much better programme in the final year and avoid the consequences of wash-up.
Lord Cormack
If the virtue of five years is to give more time to plan, and I accept the logic of that, why have we not had better planning in the first year of this Parliament?
Lord Wallace of Tankerness
My Lords, we have indicated that we will move towards a May Queen’s Speech. There is a legislative programme and I do not think the number of Bills in this first Session matches the numbers in some of the first Sessions of the previous Administration. This Bill is not yet on the statute book but if it is passed, I believe that we will see a much more orderly planned programme than I have seen since I came into this House, certainly in the final Session.
Lord Howarth of Newport
My Lords, this has been a better debate than it looked like being. We were not exactly playing to a packed House at the beginning but more and more noble Lords have stood up and made short speeches that have been to the point and very interesting. I am particularly grateful to the noble Lord, Lord Norton, for his support. At least, I think I had his support for the amendment. If so, that was quite something because I, like other noble Lords, hold his views on the constitution and constitutional reform in the very greatest respect. He is quite right to press the Government to provide an evidential base in support of the propositions they put to the House in their legislation. I do not think that the noble and learned Lord, Lord Wallace of Tankerness, was able to respond with the evidence that the noble Lord, Lord Norton of Louth, sought.
My observation is a little bit like his: I simply do not see it as being the reality that politicians plan systematically. They talk endlessly about strategies, but I have yet to see a politician who is capable of developing and sustaining a strategy over a year, let alone four years. It is wholly unlikely that the culture and work and behaviour patterns of either House of Parliament would be so dramatically changed as a consequence of knowing that the span of this Parliament was to be fixed for five years. Politicians improvise, and it is greatly to their credit that they do so—they need to. It is part of their responsibility to be responsive to public opinion and the shifts and tides of opinion and events; they are not good politicians if they are not. That is not to disparage or to criticise them. I would have a horror of a Government who were so tunnel-visioned and so rigid that they set themselves a five-year plan at the outset of a Parliament and determined to stick to it. It does not seem to correspond with political human nature, and it is an entirely spurious justification for introducing fixed-term Parliaments.
One has only to look at the ad-hocery that we have seen in this first year of the coalition Government, as the noble Lord, Lord Cormack, suggested. We have seen this Government attempt to get away with establishing a requirement for a 55 per cent vote to have an early general election. It was like a leak except that it was brazenly published in the interesting work of autobiography, memoir, history, political science or whatever it is by Mr David Laws, who candidly acknowledged—my noble friend Lord Hunt quoted from this interesting volume—the unembarrassed, shameless and self-interested calculation on the part of Mr Stunell for Liberal Democrats and Mr Osborne for the Conservatives. The noble Lord, Lord Brooke, supported by my noble friend Lord Grocott, reminded us that we have a responsibility when we address questions of constitutional reform not to dress up our views and even our calculations of party political interest in high-flown constitutional sentiment—I suppose the term is not to be hypocritical. My noble friend is quite right that we are all susceptible to that temptation. It may well be that, from his vantage point there in the corner, the noble Lord, Lord Brooke of Sutton Mandeville, is better able to spot when that aberration, that corruption, is occurring than many of us who are more impulsive participants. He was perfectly right. I suspect that I am simply too naive to make an effective calculation of party political interest. In a rather old-fashioned way, I think that it is our job to try to get all this right.
I dispute the suggestion of the noble Lord, Lord Tyler, and the noble and learned Lord, Lord Wallace of Tankerness, that my amendment would drive a coach and horses through the principle of a fixed-term Parliament, because it proposes a fixed term within a tolerance of one year. It is a fixed term with a sensible flexibility. It is a compromise, but there are many compromises already in the legislation. The Government have introduced what the noble and learned Lord, Lord Wallace of Tankerness, was candid enough to refer to as escape hatches. If the Government can introduce escape hatches, is it not in order or appropriate for us to amend this legislation to provide some pragmatic flexibility to enable the term of the Parliament to run between four and five years? That is a compromise between a fully fixed-term Parliament and the situation that we have at the moment where it is open to the Prime Minister, answerable to no one, to determine the date of the election. I believe that, previously, the date was for the Cabinet to determine. It was Lloyd George as Prime Minister who took it upon himself, on his own single initiative, to exercise the prerogative power, as one could term it, to call upon Her Majesty to dissolve Parliament.
What I am proposing lies somewhere between the two extremes. In reality, when you are legislating on most matters, you need to provide for a sensible degree of flexibility so that in practice people can carry things forward in a realistic way. The noble Baroness, Lady Stowell of Beeston, said that it would undermine one of the great benefits of the Bill as she sees it; the requirement of the Prime Minister and the Government to face the electors on a pre-determined date. The proposal does compromise on that, but it still means that there will be a pre-determined date in the fifth year of the Parliament. I think public opinion would find that quite acceptable.
The noble Lord, Lord Pannick, absolutely rightly said that in this Committee we are all being driven to tinker with a fundamentally misconceived policy. I agree with him; I do not support fixed-term Parliaments. But we are, as the previous Prime Minister Mr Blair used to say, where we are. The Bill has received its Second Reading. It is not for us to seek to overturn the principle of the Bill that there should be fixed-term Parliaments. It is for us to limit the damage that this legislation may cause. The noble Lord, Lord Pannick, suggested that perhaps the least bad way forward would be to legislate for this Parliament alone and to drop the idea of having fixed-term Parliaments after the expiry of this Parliament. I suggest that it would be deplorable to legislate to rescue the coalition from its political difficulties; to provide some sort of lifeline to coalition partners who do not agree with each other and do not trust each other and have asked Parliament to bail them out of that predicament. That would not be a proper way for Parliament to spend its time. On the other hand, I am tempted to agree with the noble Lord, Lord Pannick, that it is less bad to do that than to saddle our country and our constitution with fixed-term Parliaments in perpetuity or until Parliament decides that it was not a good idea after all and therefore we should undo the legislation.
The debate on this amendment is really an amuse bouche before the important debate on Amendment 11 which we will have next week. That will be the debate on whether we should amend the Bill to provide for a fixed-term Parliament of four years in clear-cut fashion and without the compromise and flexibility that I have suggested. That is the amendment in the name of my noble and learned friend Lord Falconer, my noble friend Lord Bach and the noble and learned Lord, Lord Lloyd of Berwick. That will be a major debate.
Lord Tyler
I wonder whether the noble Lord recognises that if he had not spoken at such length we could have progressed on to Amendment 11 this evening.
Lord Howarth of Newport
I assure the noble Lord that that is absolutely not the case.
We have had a useful exploratory debate on the issue of four and five years. The House ought always to listen with special care to the noble Lord, Lord Martin of Springburn. As a former Speaker of the House of Commons, he understands that House in a way that few others do. The noble Lord has given us some reasons why Parliament should favour a four-year fixed term rather than a five-year fixed term and we should meditate on what he said. In the mean time, I beg leave to withdraw this amendment.