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.
This information is provided by Parallel Parliament and does not comprise part of the offical record
Police Forces
(12 years, 10 months ago)
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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
Teresa Pearce (Erith and Thamesmead) (Lab)
It is a privilege to hold this debate under your chairmanship, Sir Alan. I requested it because, in one of my surgeries recently, I met a young police officer who told me in great detail about his concerns for his career and those of his colleagues and for the general morale of the police in the light of recent Government policies. We talk a lot about the effect on the public of the Government’s 20% cut in police funding. Although that is important and I will mention it, it is equally important that we focus on its effect on the police force and police officers.
Police officers up and down the country feel angry about budget cuts and attacks on terms and conditions and pension provision, following the Winsor and Hutton reviews. Police officers cannot strike, and many feel that they have no voice and no way to fight the changes. I hope that this debate will make them feel that they have had an opportunity to state their case to Ministers through their elected representatives. I also understand that the Police Federation is to lobby Parliament next week, and I look forward to attending.
The Government intend to cut the overall policing budget by 20% in real terms by 2014-15. It is estimated that that will result in the loss of 12,000 officer jobs and 16,000 other police staff jobs. Research drawing on information from police forces and police authorities suggests that in the Metropolitan police area, which covers my constituency, 1,291 police officers and 1,046 police staff will lose their jobs over the next three years.
Jessica Morden (Newport East) (Lab)
Tomorrow, I will show around the House four police officers nominated this week for the national police bravery awards. Does my hon. Friend agree that in a week when we are rightly focusing on the special job that the police do, it is equally important that the Government listen to police concerns about the impact of cuts on morale in the service?
Teresa Pearce
I certainly agree. It is a job unlike almost any other, except the armed services or ambulance drivers. It is a special job with special needs, and we must listen to what the police are telling us.
Keith Vaz (Leicester East) (Lab)
I congratulate my hon. Friend on securing this debate, as I congratulate you, Sir Alan, on your recent elevation as a knight of the realm. My hon. Friend the Member for Newport East (Jessica Morden) mentioned listening. Did my hon. Friends have the opportunity to hear the speech of Sir Hugh Orde to the Association of Chief Police Officers conference yesterday? He said that what was happening to the police force was the most profound reform in 180 years and that what was required, as my hon. Friend the Member for Newport East suggests, was a period of listening during which people could be consulted, as with NHS reforms, to give the Government the opportunity to see what will happen as a result of their reforms. Does my hon. Friend the Member for Erith and Thamesmead (Teresa Pearce) agree that a period of listening is desirable at this stage?
Teresa Pearce
I agree. I am pleased that there are so many Members here today. Through us, police officers’ voices will be heard, but a period of consultation is needed, owing to the unusual nature of their job and the daily importance of teamwork and morale.
In my constituency, 1,291 police officers and 1,046 police staff will lose their jobs over the next three years. Senior police chiefs also plan to cut 150 sergeants from local policing teams next year. The figure could rise to 300 in the next two or three years. It is worth bearing in mind that the cuts will affect London police forces and that it is estimated that more than 9,000 police officers will be required each day at the peak of the London Olympics, in an operation that Scotland Yard describes as the biggest ever policing challenge facing Britain. Deputy Assistant Commissioner Richard Bryan said that the games would put unprecedented demands on the Metropolitan police, yet the Met faces 20% cuts.
The Home Office says that the savings can be found solely in back-office functions and efficiency savings, with no impact on front-line policing.
Rosie Cooper (West Lancashire) (Lab)
I congratulate my hon. Friend on securing this debate and thank her for allowing my intervention. Does she know that Lancashire police are dealing with cuts of more than £40 million and are consulting on proposals to cut front-desk services in Ormskirk and sell police stations and houses across West Lancashire? That will leave my constituents with a 25-mile round trip to the nearest police station. It comes on the back of a reduction in the number of officers on our streets, and the future of police community support officers is still under threat. Does she agree that the Conservative-led Government have broken their promise that front-line services would not be affected by cuts, that the impact across the country and in my constituency will lead to an erosion in people’s feeling of safety on their streets and in their homes, and that crime—and, more importantly, the fear of crime—will increase?
Teresa Pearce
I agree. That brings me to the question of what front-line policing is. The police representatives to whom I have spoken say that the Government’s view of what front-line policing entails is misguided. It involves not only uniformed officers on the beat, but staff in front-line departments such as neighbourhood policing, counter-terrorism, domestic abuse and child abuse units. Those are not back-office functions, yet they will undoubtedly be affected by severe budget cuts. It is feared that that will increase crime and public fear of crime and create a less resilient public service. Which back-office jobs would Members here consider unnecessary to our work: researchers, case workers, the Table Office, the Vote Office or the Library? Those might be seen as back-office functions, but they are integral to our work, and it would be impossible to do our job without them.
David Simpson (Upper Bann) (DUP)
I congratulate the hon. Lady on obtaining this debate. Hugh Orde was mentioned. He has vast experience of policing, especially in Northern Ireland as Chief Constable. Does she agree that police officers in Northern Ireland—like those here on the mainland, I am sure—say that one of the biggest hindrances to police officers in doing their job is the red tape, bureaucracy and form-filling involved in an arrest? That makes it difficult for them to do their job.
Teresa Pearce
That is another case of our need to listen to what police forces tell us. Rather than making a 20% cut and telling them that they must make cuts in turn, we must listen to what they tell us needs to change. No one is saying that police forces should not change and develop, but they are the experts, and we must listen to them.
Her Majesty’s inspectorate of constabulary says that the maximum saving that the police service could achieve without an impact on quality of service is 12%. There is a big gap between that and a 20% cut. It is difficult to see how front-line policing could not be affected. The situation is made more difficult by the fact that the Home Office has no formally agreed definition of front-line policing. The chairman of the Police Federation, Paul McKeever, said that it is reckless for Ministers to base policies on a term with no legal definition.
Her Majesty’s inspectorate of constabulary has tried to define front-line policing. Its recent study said that 67% of police officers and civilian staff are involved either in visible contact with the public or in specialist roles that involve intervening to keep people safe and enforce the law, meaning that they should be considered as front-line. I understand that the Home Office has consulted Her Majesty’s inspectorate of constabulary to establish a definition. Will the Minister update Members on what progress has been made? It is important to have a definition so that the effects of policies on the police can be measured properly.
Morale is low in the police force. Officers are worried not only about their ability to protect the public in the face of drastic funding cuts, but about threats to their own financial situation and future.
Joan Walley (Stoke-on-Trent North) (Lab)
I congratulate my hon. Friend on securing this debate, which is important to people throughout the country who, like her, are concerned about front-line policing. Does she agree that that concern is shared by members of the coalition Government as well? All-party meetings are taking place to discuss concerns about front-line service. One big issue with the cuts to front-line services is the introduction of single crewing, which means that police officers are attending crimes alone. That is causing real concern about the standard and quality of front-line policing, as are the linked issues of pensions and future conditions of service, and I hope that the Minister will address that.
Teresa Pearce
My hon. Friend makes an important point. The issue affects morale. The police have told me that one of the good things about working in the police force is the teamwork. How they work together helps them to build relationships with one another and develop mutual trust and understanding. Working alone makes the job virtually impossible and very dangerous.
A recent survey by the Police Federation found that the budget cuts have led 98% of officers to claim that morale has fallen in the ranks. Moreover, 86% believe that the fight against crime will be damaged. Police numbers are already dropping and have fallen by 5,000 since January. The same period has seen a 16% rise in civilian volunteers or special constables, and there is concern that volunteers will be used to replace the work that should be undertaken by police officers, all in the name of deficit reduction.
At about the same time as the 20% overall budget cut was announced, Lord Hutton’s review of public sector pensions and the Winsor report on police pay and conditions delivered their recommendations. If implemented, the Winsor report recommendations will see the vast majority of police officers take a real-terms pay cut on top of increased work loads. Some officers could be up to £4,000 worse off, which does not include the additional hit of inflation. Police officers face the prospect of their basic salaries being frozen for two years from September 2011 and of inflation running at 5%. Over two years, the average salary of a police officer could fall by more than 10% in real terms.
Winsor’s recommendations will also reduce pensionable pay. If officers have not reached the top of their pay scale, they will be at the same pay point for the next two years—an average loss over two years of £2,345. Officers are at the top of their pay scale can receive the competency related threshold payment, but Winsor recommends that it be scrapped, so they will lose £1,212 a year. On top of that, the competency related threshold payment makes up officers’ pensionable pay. If it is removed, their annual pensions on retirement will be £800 a year lower.
On top of those proposals, officers who fall into certain groups may see their pay cut by even more. If they regularly work ordinary overtime, given the change to plain time, they will lose an average of £430 a year. If the force requires officers to work overtime on rest days, with less than five days’ notice, they will lose an average of £300 a year. If the receive a special priority payment, they will lose between £500 and £3,000, although some officers could lose more. Those are average figures—some officers will receive more, but others will get less and some nothing at all. With cuts of that size, some police officers might be compelled to leave the service because of financial difficulties.
Pat Glass (North West Durham) (Lab)
I congratulate my hon. Friend on securing this important debate. I have never worked in the police force, but I have been married to it for 26 years. I hear of the first-hand experiences of police officers in my constituency, and they tell me that the combination of the cuts in funding, the attacks on their pensions and the way the Government are seeking to drive a wedge between what they see as front-line services and others is having an impact on morale. That, in due course, will have an impact on outcomes, which will affect us all.
Teresa Pearce
I thank my hon. Friend for sharing with us her personal circumstances. Officers have written to me with testimonies saying that the financial hit means that they will be looking to leave the job at the earliest opportunity. That is backed up by the fact that nine out of 10 of the police officers who responded to the Police Federation survey said that they fear their colleagues will quit because they will be unable to make ends meet. In a job in which teamwork and trust are essential, that could be disastrous. I find it difficult to understand how there could not be a knock-on effect on police recruitment and retention.
Being a police officer is not an easy job. The hours are long, unsociable and often not conducive to family life. For instance, rest days can often be cancelled at the last minute. Police officers can also suffer violent assaults, mental stress and injuries that have a lasting effect on their lives and those of their families. I have heard from officers who feel that they do a 24-hour-a-day job in their community. It is not unusual for a police officer to have family, friends and neighbours calling at all hours asking for advice and help. It is not a job where they can clock off at 5 o’clock. Policing is not like other jobs. They do not leave it behind when they finish their shift; it is a 24/7 job. On or off duty, day in, day out, uniform on, uniform off, they are always police officers.
Police officers make those sacrifices in their personal lives because they want to serve their community, but also in the understanding that they will be financially compensated for taking on a dangerous and demanding job. When asked to sum up their current mood, one police officer told me:
“The rug has been pulled out from underneath me. I joined the service because I felt I had the skills and capabilities to use for the good and in the protection of vulnerable sections of society and victims of crime. However, I did this in the understanding that I would be fairly compensated for taking the risks that the job entails, and for the negative impact that it would invariably have on my own quality of life through stress and shift work.
I feel I am being penalised for making the sacrifices inherent in doing this job, and that the Government are gunning for the Police Service as the easiest Public Sector target. Without the right to strike I feel we can do nothing. This is not about fairness, it is about saving the largest amount of money in the shortest amount of time and hang the consequences for those involved, Police and public.”
I have heard from another officer whose role has an on-call requirement that is voluntary. He has been urged not to continue to fulfil that requirement if special priority payments are scrapped for on-call work, because his family life will be restricted without any financial compensation. However, police officers do not do their job just for their salary. If money was their primary motivation, they would all be in different jobs. We cannot expect them, however, to take on the huge sacrifices required by the job without fair financial reward for doing so. To pay them properly is a sign of the due respect that we should show them.
If we value what the police do, we should show that by making sure that they are able to have a family life and a decent home. Most young officers in my area have no chance of buying a place to live. A young man who came to my surgery explained that he is 25 years old, studied for three years and brings a wealth of experience to his role, but after paying his tax, national insurance, student loan and rent, and his bills for the phone, petrol and food, there is little left. He spends his time off work sitting in his rented flat, because he has no money with which to socialise with friends or to take part in any of the leisure activities that one would expect as a professional. He already earns below the national average wage and a two-year freeze will make it worse. He is seriously thinking of leaving the force. I doubt whether he is alone in that view.
The cuts to police pay may also have an impact on pension provision. Many officers say that if the cuts are made, their only option will be to quit the police pension scheme. It is not hard to see why they are considering doing so—less pay, greater pension contribution rates and higher inflation will push people to take such drastic action. The impact on society in later years will be significant. The proposed increase in employee contribution rates needs to be highlighted, because police officers already contribute at the highest rate of any public sector workers. Police contribution rates to pension schemes are between 9.5% and 11%.
Many police officers in my constituency have also contacted me about the switch in the indexing of their pensions from retail prices to consumer prices. I have opposed that switch in speeches on the Floor of the House and voted against the annual up-rating order. I also signed early-day motion 1625, which calls for the annulment of the statutory instrument that made the switch. I am not convinced by the Government’s argument that CPI, which does not take into account housing costs, is the better measure of inflation for pensioners because most pensioners own their own homes. Even if pensioners no longer have mortgages, they still have to pay costs associated with housing, such as council tax and heating. Such costs can be a heavy burden. Although I oppose the switch to CPI on behalf of all public sector workers, people in fields such as law enforcement, the emergency services and the military stand to lose the most because of the switch. They often need to access their pensions earlier in life, because of the physically demanding nature of their job or serious injury suffered at work.
Everyone deserves a decent pension, especially police officers, given the risks and sacrifices inherent in the job. In a parliamentary answer to my hon. Friend the Member for Wallasey (Angela Eagle) on 14 February, the Minister for Policing and Criminal Justice said that no assessment had been made of the number of members of the police pension scheme who may opt out of it as a result of the change in indexation. Does the Department intend to conduct such an assessment in the future?
The expectation of a reasonable retirement income has also been an important recruitment and retention tool for the police. That was highlighted by the submission of the staff side of the Police Negotiating Board to the Independent Public Service Pensions Commission. It said:
“In order to recruit and retain officers of appropriate calibre who are willing to accept these hazards, members of a police pension scheme should be allowed to work towards, and benefit from, a reasonable retirement benefit. They must also be secure in the knowledge that should their career be cut short by illness or injury, they will be appropriately supported.”
Without such an incentive, we may find it hard to recruit and retain officers in the future.
Many police officers in my constituency have written to me about the need for a royal commission on policing, because the Winsor and Hutton reviews demonstrate a fragmentary and disconnected approach to reform of the police service. Early-day motion 1604, tabled by the hon. Member for Birmingham, Yardley (John Hemming), calls for such a commission to establish precisely what is required by the British police to ensure that they continue to deliver a public service that is fit for purpose. I support such a commission, but agree with the amendment tabled by my hon. Friend the Member for Birmingham, Selly Oak (Steve McCabe): it must deal with the urgent problems of excessive Government cuts and the impact on police forces. I should be grateful to the Minister if he answered the concerns that I have raised and said whether he supports such a commission.
Tom Brake (Carshalton and Wallington) (LD)
I congratulate the hon. Member for Erith and Thamesmead (Teresa Pearce) on securing this very important debate. I am pleased that so many hon. Members are present to discuss the subject. I shall make a limited number of points about what Sir Hugh Orde said yesterday, but before I do, I would like to show support for and congratulate officers on the work that they do in my constituency. I am sure that other hon. Members will do likewise for their constituencies.
Last week, I had the pleasure of attending a police academy event at Camden junior school, where the local safer neighbourhoods team and some police cadets were training a number of pupils in the arts of marching, fingerprinting and working with police dogs and horses. A great time was had by all. At the end of that event, as we were handing out certificates, I asked the children how many of them wanted to join the police force. It may be that they have not heard about some of the changes being made, but I am pleased to say that half of the children put their hands up and said that they wanted to join the police force as a result of attending the police academy. I thank my safer neighbourhoods team for arranging that.
Toby Perkins (Chesterfield) (Lab)
Is the hon. Gentleman not worried—as I am—that if we cut down on staff who are not seen as front line and pare down the police’s responsibilities, that kind of activity will disappear?
Tom Brake
I am very pleased to reassure the hon. Gentleman that the scheme is continuing—or starting up again—in September. The police cadets involved are, in fact, pupils at one of the local secondary schools, and will therefore continue to play a key role in delivering that scheme.
I shall move on to what Sir Hugh Orde said yesterday. Among other things, he highlighted concerns about changes to accountability, central structures and, of course, pay and conditions. I shall just make a few points about those matters. On changes to accountability, the Police Reform and Social Responsibility Bill is going through the Lords and some of the amendments that are being considered will add substantially to the accountability of police and crime commissioners.
For example, confirmation hearings for key PCC staff posts will be introduced and police and crime panels will be able to hold confirmation hearings for key staff. Importantly, co-operation between PCCs and community safety partnerships will be strengthened, because accountability for delivering improvements in safety will be enhanced if there is a clear requirement for those two groups to work together co-operatively. The required majority for the police and crime panel to veto chief constable appointments will be amended, and the precept will be changed from three quarters to two thirds. We have pushed for that very hard through amendments 103 and 192. The composition of the police and crime panels will be extended to allow additional members. That will ensure all authorities within an area covered by a police and crime commissioner are represented. In terms of accountability, those are substantial improvements to the current arrangements.
Another area where accountability needs to be enhanced is in relation to the draft protocol that is being drawn up. That sets out how the relationship between the police and crime commissioner and the chief constable will operate within England and Wales. There is scope for improvement there, particularly on how the protocol might operate in relation to Wales. I have taken soundings from a recently retired senior police officer on other areas within the protocol, and he was clearly very keen for the majority to be changed. That is being taken up through Lords amendments. He also thought that further clarity was required regarding the fact that the police and crime commissioner will be the recipient of all funding, including the Government grant and the precept related to policing and crime reduction. How that money is allocated is a matter for the police and crime commissioner. That requires further clarification, because if the police and crime commissioner, for example, decided that no money at all was going to be spent on Tasers, thereby stopping the police using them, some might argue that that was interfering with operational matters. It would be helpful to have further clarity on the circumstances surrounding the protocol, and on whether the police and crime commissioner will be able to allocate funds without reference to any other parties.
The protocol is a good starting point. As I said, I am pleased that it will be amended to reflect the fact that the majority needed for a power of veto will be cut from three quarters to two thirds. I hope that when the protocol is published, more clarity will be provided about the relationship between the Home Secretary and the police and crime commissioners. One of the essential proposals in the Government’s plans that I support is about ensuring that policing is delivered locally without the interference of the Home Secretary. It would be helpful to have more detail in the protocol to ensure that that is the case, because whoever is Home Secretary—or, indeed, Prime Minister—clearly there will always be an inclination to get involved in day-to-day policing matters. If any further strength can be given to the powers of police and crime commissioners in the protocol to ensure that they have responsibility for policing at a local level, that would be helpful.
The other concern that Sir Hugh Orde raised was about the central structures. Elected police and crime commissioners are clearly part of that, but the national crime agency also falls into that category. As hon. Members will know, four commands will cover organised crime, border policing, economic crime and the Child Exploitation and Online Protection Centre. That structure could work more effectively nationally by drawing those different bodies together, and I certainly welcome the emphasis put on the border policing aspect.
Hon. Members have previously raised concerns about CEOP, and may do so today. I have visited CEOP and had detailed discussions with people there, including the new chief executive, Peter Davies. My impression is that he is completely confident that he can ensure that CEOP will continue to work effectively, whether it comes under the Serious Organised Crime Agency, as of course it did, or the NCA. All the private funders of aspects of CEOP’s work have indicated that they will continue to fund the organisation once it is included within the NCA. When the Home Secretary made a statement about that, she said:
“An individual at chief constable level will be appointed fairly soon”,
and that that individual
“will…work within the Home Office over the period before the NCA is set up.”—[Official Report, 8 June 2011; Vol. 529, c. 237.]
It is essential to have an effective person in place, and to have a sufficient transitional period to allow for an effective transition. I would be interested to hear what particular lessons were learned from setting up SOCA, and how those lessons will be applied to the establishment of the NCA.
My last point concerns changes to pay and conditions. Sir Hugh Orde and others have highlighted concerns about morale. We have to accept that, certainly according to surveys, morale in the police is not good, although I talked to officers on Friday and they did not express concerns about morale. They seemed to be fully committed and were enjoying their jobs. However, surveys show clearly a very high level of concern and unhappiness in the police force. One thing that the Government can do is explain—or re-explain, or explain in more detail—exactly what the impact of the proposals will be. Yes, it is true that some officers will suffer a reduction in pay. It is also true, however, that some officers will see their pay increase by up to £2,000 as a result of the changes, and that needs to be explained.
Another reason for low morale may relate to other things that the Government are having to do to tackle the deficit. I am confident that once those changes start to take effect and we start to see the economy moving in the right direction and a big impact is made in reducing the deficit, morale, not only in the police service but beyond, will improve.
Mr David Hanson (Delyn) (Lab)
When I was Minister with responsibility for the police, I published proposals for the grant for this year and next year. Will the hon. Gentleman remind me why he opposed those proposals and called for more money? Why does he, a Liberal Democrat, now support a 20% cut in the money going to policing, despite the fact that the Labour Government were going to make savings in the budget for this year and next year? That 20% cut has an impact on some of the major concerns that he has mentioned.
Tom Brake
The right hon. Gentleman will perhaps know that what appeared to be the case regarding his Government’s finances was not necessarily the case once one looked at the detail. For example, the structural deficit was much higher than the previous Government had led us to believe. The changes that we are making are, to a large extent, changes that his party would have had to make if they were in power. I hope—I am always hopeful—that we will hear some solutions from Opposition Members and an articulation of their alternative. I am sure that Opposition Members feel that the themes they hear from those on the Government Benches are always the same. I would say in return that the themes raised by those on the Opposition Benches are always the same—a catalogue of genuine concerns are raised, but a solution is never provided.
Mr Hanson
When I proposed a police budget containing reductions of £1.3 billion, with savings on procurement, overtime and mergers of back-office staff, the hon. Gentleman opposed it. He now supports a £2.5 billion cut. The extra cuts of £1.2 billion will cause concern about morale, numbers, rising crime and the impact in our communities, as outlined by Sir Hugh Orde yesterday. Why has the hon. Gentleman changed his view in the past 12 months?
Tom Brake
I have already explained why I have changed my view. The Government have to take those decisions. I suspect that if the right hon. Gentleman was still the Minister with responsibility for the police, he would be saying some unpalatable things about pay and conditions, pensions and so on, too. Maybe he will say that when he makes his speech.
In conclusion, there are improvements that the Government can make and are making in relation to accountability and central structures to ensure that the transition to the NCA is seamless. The Government are doing what they can on pay and conditions in a very difficult financial climate.
Jack Dromey (Birmingham, Erdington) (Lab)
It is a pleasure to serve under your chairmanship, Sir Alan.
Who are they, the human face of police cuts—the casualties of Government policy? The Home Secretary was good enough to meet recently with six officers from the west midlands. Inspector Mark Stokes, a police officer for 33 years and a specialist in crime reduction—the longest serving in the country. An expert at designing out crime; for example, the Four Towers estate scheme in Birmingham saw a 98.7% cut in crime. There is no better example worldwide, and that is why he has a deserved international reputation—forced out.
Sergeant Dave Hewitt is 48 years old, with 32 years of service, and a neighbourhood sergeant. An expert in early intervention—stopping antisocial behaviour becoming serious crime. He tackled problems ranging from dangerous dogs to cannabis factories. He is a man who engaged successfully with his community, which led to a significant reduction in crime—forced out.
Police Constable Ian Rees is 55-years-old with 34 years of service. A motorway police officer—the first on the scene after serious accidents, coping with death and distraught families. For example, a serious accident on the M42, involving a minibus on its way to a wedding, caused serious injuries and one death. He not only coped with that, but was then the police liaison officer with that family afterwards, giving them comfort—forced out.
Detective Constable Tony Fisher, aged 50, has 33 years of service. On the one hand, he tracked down the gang who were robbing pensioners at cash machines and put away the leader for 13 years. On the other, he tracked down a gang led by a man who wielded a machete when robbing shops and put him away for 17 years—forced out.
Detective Constable Tim Kennedy, 31 years a police officer, is one of the best in Britain at tackling serious acquisitive crime, ranging from burglaries to cars. He has one of the highest detection rates in Britain and is described by fellow officers as an outstanding detective— forced out.
Finally, PC Martin Heard—32 years a front-line police officer, in the past nine years in an area of multiple deprivation in Wolverhampton, coping with vice crime, drugs, burglaries, engaging with the community, closing down drug dens, slashing crime in that community—forced out. To add insult to injury, within weeks of being forced out, he received a letter asking whether he would like to come back as an unpaid special constable.
Mr Pat McFadden (Wolverhampton South East) (Lab)
I thank my hon. Friend for raising the case of ex-constable Martin Heard. He served the All Saints community in Wolverhampton in my constituency in exactly the way that my hon. Friend describes. I should like my hon. Friend to respond to an e-mail that I received yesterday from another Wolverhampton officer in the same force. He wrote:
“Older in service officers, like myself are very worried about having their CRTP taken away. For me it is £100 per month less… our pay has already been frozen and with SPP also in line to be taken away”.
He went on:
“At the current time, all the officers who have spoken to me all state they love serving the local community and work to make the streets of Wolverhampton even more safer. It would be awful if colleagues leave our fine occupation due to financial issues.”
What is my hon. Friend’s response to that?
Jack Dromey
My right hon. Friend is absolutely right. Little wonder that there is a collapse in police morale. They are being asked to do more at a time of rising crime and are now threatened with being paid less. They deserve better.
The latest casualties of Government policy in the west midlands are 16 senior officers—nine superintendants and seven chief inspectors, including the heads of counter-terrorism and of crime—why? Her Majesty’s inspectorate of constabulary stated that we could experience a 12% reduction in expenditure over a period of years; instead, the Government have gone for a front-loaded reduction of 20%, with an inevitable serious impact on the police service. The consequences for the west midlands are that 2,200 will go from our police service, including 1,100 police officers.
Mr Aidan Burley (Cannock Chase) (Con)
The hon. Gentleman is sailing close to the wind, and I would not want him to mislead anyone in the Chamber. He mentioned Government policy in the west midlands and repeatedly used the phrase, “forced out” in his opening remarks. To be clear, will he confirm that no Government policy whatever forces chief constables to retire officers with experience of 30 years or more and that the use of regulation A19, to which he alludes, under which such officers are being “forced out”—his words—is purely a matter for the chief constable of the police force and has absolutely no direction from the Government? The best chief constables can manage their work force without losing officers with the most experience.
Jack Dromey
That is the Home Secretary’s Pontius Pilate defence. At the worst possible time—2,500 more burglaries, 2,200 more vehicle crimes, robbery up by 25%—the Government are cutting the police, but they are then blaming the police for the cuts. The Government have put good chief constables, such as Chris Sims of the West Midlands police, an outstanding leader of his service, in an impossible situation. It is about time that the Government accepted responsibility for the consequences of their actions and did not blame our chief constables.
Gavin Barwell (Croydon Central) (Con)
The hon. Gentleman is right to put a human face on the decisions taken and is right to ask why. Can he tell me why the reductions cited are being made in the west midlands, whereas in my constituency the Metropolitan police force is recruiting additional officers this year?
Jack Dromey
Because, in how the Government have proceeded, we have seen time and again a disproportionate impact on areas of high need and high unemployment, such as Birmingham and the west midlands—not only in the police service, but in local government and the health service.
In conclusion, this Government have reversed the welcome progress of the previous 13 years. Our Government had put 17,000 more police officers and 16,000 police community support officers on the beat, leading to a 43% reduction in crime. It is little wonder that there will be thousands of police officers descending on London next week. They will be here to defend the service that they love. They are Birmingham and Britain’s best, and they deserve better than to be told, “Thanks for your loyalty; here’s your redundancy notice.”
Nigel Mills (Amber Valley) (Con)
I congratulate the hon. Member for Erith and Thamesmead (Teresa Pearce) on securing this important debate. She was right about many things, in particular that the police struggle to speak for themselves—they are one of those services that cannot strike—so it is right for Members to have police debates, when we can speak up for them.
I have the pleasure of being on the police parliamentary programme, spending about 15 days with the police this year. I am always cautious speaking in a police debate, because if I say anything that they do not like, the chances are that I will find that out the hard way on the next day that I spend with them. My next day with them involves going up in a helicopter, so they will have scope to show me whether they like the things I say.
The police are facing a variety of what they probably regard as attacks from all angles, such as the funding cuts and the changes to the pay and conditions of police officers, although we should draw a distinction between those for uniformed police constables and those for police staff, who, I suspect, are often in an even worse position. The Government are also making structural changes to the accountability of the police force, which the hon. Member for Carshalton and Wallington (Tom Brake) discussed.
This is the fourth or fifth policing debate that I have spoken in over the past year, and I always start by urging the Government to review how they allocate funding to various police forces around the country. If we look at the impact on forces, we need either to implement the existing funding formula, so that forces actually have the funding that the formula calculates for their needs, or to find a better formula and implement that. We cannot, however, remain with a formula that calculates for Derbyshire police £5 million more than they actually get, and yet each year say, “That’s difficult, we will leave that for another year.” I am sure that the Nottinghamshire police force of the hon. Member for Gedling (Vernon Coaker) is in a similar situation and that we will get the same pleas from his force. If we need to be more efficient, can we start with fair funding in the first place? Derbyshire police force thinks of itself as extremely efficient—it has had to be for years, because in its view it has been underfunded. The concern of Derbyshire police is that, while it accepts the scope for more efficiency and further savings, it is hard to keep getting more blood out of the stone when it sees other forces not being forced to make the same level of efficiency savings. I have made that plea almost half a dozen times now. I hope that a different Minister will give a more encouraging answer to my police force, but I fear that that might be beyond his role today.
In common with all Members present, I have been lobbied by various serving and retired members of the police force about the impact of the proposed changes to their pay and conditions. All of us who have been in employment, and who have experienced threats to the business in which we are working or announcements of change and redundancy reviews, know that such times are horribly unsettling and uncertain. One lesson that I have learned is that the time of uncertainty should be as short as possible for it to be as fair as possible on the people affected, so I am concerned that many weeks have gone by since the Hutton and the Winsor announcements. Serving police officers do not yet have any idea which of the proposals will be implemented by the Government, which will not and how the proposals will impact on individuals. If we want to get police morale trending back upwards, we need to resolve what the Government proposals actually are, although I understand that they are under negotiation and that it is hard to come up with any public statement. Human nature, however, is to flick through the reports, find all the worst possible scenarios, add them all together and envisage a situation that, I suspect, is far worse than the reality will be.
Toby Perkins
I am glad that the hon. Gentleman has highlighted the situation in Derbyshire, which we both represent. At the Police Federation conference, Derbyshire representative Sarah Adams reminded everyone of what the Home Secretary said at an earlier conference:
“If you come with me, I will make this promise: I will always back you, I will always support you, I will always fight for you.”
Sarah Adams finished by asking the Home Secretary
“how can you expect police officers or the communities we serve to trust you or your Government?”
Our representative from Derbyshire said that to the Home Secretary. Does that make the hon. Gentleman feel neither that the police have misunderstood nor that the Government have failed to explain, but that the policy is wrong?
Nigel Mills
I have had some great times with the police going around the hon. Gentleman’s constituency, because we are advised on the police parliamentary scheme not to go around our own seats in case we attract more attention than the police do themselves. I would not go as far as he did in his intervention. Without doubt, we have a huge deficit, which has to be tackled, and there is no way that police forces can be shielded from that—they will have to pay their share, and I think that they accept that. I am sure that we will disagree about how large the share should be, but, when pay accounts for three quarters of police budgets, there is no way around the fact that that is what must take a fair chunk of the strain.
My point is that it is only fair on people to tell them what the changes will be as quickly as possible, rather than dragging out the uncertainty for months. Some things in the Winsor review and, in particular, the Hutton review are welcome. Hutton singles out the police force for a better deal on pensions than other public sector workers can expect, because they will be allowed their pension at 60, rather than the age rising to 66 or 67.
Mr Burley
Does my hon. Friend accept that some police officers may receive their pension as early as the age of 48? Police officers have unique job security. It the only job in the public sector that I can think of which people may start at 18, and have a job for 30 years, and a guaranteed pension of around two thirds of salary with no chance of being made redundant. Police officers cannot be made redundant, unlike people in every other job in the public and private sector. That unique job security should be reflected in the overall pay and conditions and, indeed, pension.
Nigel Mills
I am grateful for my hon. Friend’s intervention, but I think he is leading me down a line that would cause some difficulty. There is merit in considering whether police officers should sign up for 30 years, or whether they should join on a shorter contract. There is logic in signing up for 10 years, and if that works out for the force and someone wants to stay longer, they can do so. If it is not working out after 10 years, they may want to do something else. I was encouraged that Police Federation representatives from Derbyshire whom I met a few months ago were keen on that idea, and could see some advantages.
My hon. Friend tried to tempt me down the line of police redundancy, and my hon. Friend the Member for Rochester and Strood (Mark Reckless) has introduced a ten-minute rule Bill on that topic. I think that that would probably add more uncertainty to police officers’ views on their future. Some to whom I have spoken have colleagues who are unfit for work or have lost their enthusiasm for it, and a mechanism allowing them to leave would probably be a positive step, but I suspect that that is not the general view of the police force.
I want to plead for police staff whose terms and conditions are not as generous as those of serving police officers, but who have borne the brunt of some previous savings rounds. They do not have redundancy protection, and they fear that they are being even more unfairly squeezed when police forces are looking to make savings. I have certainly had representations from them saying that they do not have the same generous pension to look forward to and cannot retire at the same time. We must ensure that the balance of savings is spread fairly.
When we talk about front-line and back-office functions, it is easy to blur the fact that some of those functions that are key to the front line, but are not strictly uniform, are being squeezed. I have had representations from scene-of-crime officers saying that compared with years ago when a team would sent to almost every burglary, there is now a squeeze on and it is hard to get an operative to go to a crime scene. Certainly that service is not available for many burglaries. That is not the way to improve the rate of crime detection.
There are many challenges, and at a time of funding constraint, it is important that the Government give the police all the necessary powers to tackle crime as efficiently as possible. I will cite one example from the burglary division of Derbyshire police. I am sure that the hon. Member for Chesterfield (Toby Perkins) agrees that Derbyshire police has made great improvements in recent years in tackling burglaries and in providing a service to victims of such crimes. It has told me that many burglaries are carried out by people who want to steal jewellery to fund their drug habit. They rob a house, nick the jewellery and take it straight down to the local jeweller, who sometimes has a melting pot. The jewellery is sold for cash, and even if the police receive a tip-off about where the jewellery has gone, there is no trace of it or whom it was bought from. Previously law-abiding jewellers are being snared by the high price of gold into that route of crime. There are no regulations that the police can use to tackle jewellers or to force them to keep details of jewellery that they buy or whom they bought it from.
Regulations apply to scrap metal dealers, and even to pawnbrokers, but not to jewellers. If we are to help the police tackle crime, we must tackle the demand side and give them the powers that they need. I hope that the Minister will encourage his colleague, Baroness Browning, to look at the matter a little more closely than she suggested a couple of weeks ago.
I want to touch on accountability, because it is important that the police are brought back closer to the communities that they serve. There have been many welcome developments on neighbourhood consultation, but the introduction of elected police commissioners will do that, and I hope that the Government will proceed with that and not bow down to Lords wrecking amendments. It will be an important development, and even serving police officers have told me that they are looking forward to it, because it will make the force seem more accountable. Perhaps even at chief constable level it will encourage focusing priority on the area and not on the national, high-profile matters that chiefs sometimes focus on. That reform is essential to bring the police back to their trusted status with the public. I urge the Government to progress with that.
Mr Iain Wright (Hartlepool) (Lab)
It is a pleasure to serve under your chairmanship, Sir Alan. I congratulate my hon. Friend the Member for Erith and Thamesmead (Teresa Pearce) on securing this important debate, which affects every community we represent in this House. In the time available, I want to make three brief and interrelated points: first, I want to discuss crime and antisocial behaviour in my constituency; secondly, I want to talk about how, as the long title of this debate hints, Government policies will place enormous strain on police forces at a time of drastic cuts; and thirdly, I want to point out that morale in the police force is at an all-time low, which has been alluded to in the debate.
Before doing so, however, like other hon. Members, I pay tribute to police officers throughout the country, and particularly in my constituency, who do so much on our behalf. I have been out on night shifts with officers, and I have seen at first hand the danger, anger and violence that they face. Some of the things that drunken thugs say about officers and their families are truly horrific. I admire the restraint and professionalism that they show in the face of such pressure and danger.
Mr Wright
I do not have much time, and I know that other hon. Members are waiting patiently to speak, so I hope that the hon. Gentleman will forgive me if I do not give way.
Hartlepool has experienced a pronounced drop in crime and antisocial behaviour over the past few years. Crime has dropped by 4% in the past year alone and by an astonishing half in the past seven years, and there are 6,000 fewer victims of crime in my constituency, with a reduction in the distress, ruin and low quality of life that crime produces. That is wonderful. In the past 24 hours, officers carried out a dawn raid in the village of Elwick in my constituency, where they uncovered a cannabis farm containing more than 1,000 plants with a street value of about £400,000. Officers from Hartlepool district drugs unit, the district support unit, the town’s dog section and Cleveland police helicopter all assisted in the raid. Cleveland police stated:
“These plants could have been destined for the streets of Cleveland, the co-ordinated and robust effort of officers has once again stopped the vicious cycle of these illegal substances from affecting our local communities.”
That great success in the past few years is a result of investment, co-ordination and that intangible sense that the police matter and are valuable—they should be seen as such. This is no time to be complacent, and much more needs to be done. Although criminal damage has fallen spectacularly in Hartlepool in the past five years, violence against the person has been on the increase in the past year after falling substantially since 2008. Despite the successes of the past year or so, and in the past couple of days, drug offences have risen sharply in the past two or three years.
Where there is economic deprivation, there is often crime, and we should all be mindful of the risk of crime when there is rising unemployment. Despite what Ministers say, there is a link between economic inactivity and crime, and it flies in the face of common sense to suggest otherwise. There are disproportionate cuts to public services in the north-east, and a particular and worrying emphasis on cutting early intervention schemes, which often nip problems in the bud. Youth unemployment is a particular concern in my constituency, with the risk of a generation of young people being lost to meaningful employment. With the cancellation of the education maintenance allowance, the abolition of the future jobs fund and so on, we are seeing the end of all possible help and support.
I am not suggesting for one moment that people who have lost their jobs or who are on benefits are more inclined to commit crime, but Government policies on matters such as welfare and housing benefit are socially divisive, making the lives of families who are already struggling even more difficult, with a threat to social cohesion. That is a risk, and we must have an effective policing system to address that risk.
My third and final point has already been mentioned. It concerns the appallingly low morale in the police service at the moment. Police officers have e-mailed me and come to see me at my constituency surgery. Many of them, often with decades of experience, have said that morale is on the floor. They have expressed concern that at a time of added risk and strain in terms of crime and antisocial behaviour, excessive cuts will mean the loss of police provision. In my area, a particular strength has been the number of police community support officers, which went from 37 in 2003 to almost 200 last year. They have made a real difference by providing a visible presence on the streets, and working closely with neighbourhoods and residents to provide reassurance, gain intelligence about an area and head off potential trouble and criminal activity. Because of the Government’s financial settlement, however, PCSOs in Cleveland police force cannot be guaranteed in their current form beyond 2012-13. The loss of those PCSOs would have a huge and negative impact on safety and reassurance in my community.
As we have heard, police terms and conditions are being attacked on all sides, including in the Winsor review and in the Hutton review of pensions. Officers have told me that the cuts seem to be ad hoc and piecemeal, and that the Government lack a vision for policing in the 21st century. That is why a royal commission on policing would be a sensible way forward. That possibility has already been mentioned in the debate, and I hope that the Minister will say something positive about such a commission.
Despite the pressures and cuts, police in my patch will do their job professionally, as they always do, and they will do their best. There is, however, an understandable feeling and growing resentment that the Government are making the police go out to do their duty with one hand tied behind their backs. As my hon. Friend the Member for Birmingham, Erdington (Jack Dromey) has said, at a time of growing pressure, and given the huge risks that they run when they go out on shifts, the police, and the communities that they serve, deserve better.
Mr Aidan Burley (Cannock Chase) (Con)
I was not going to speak this morning, but before the winding-up speeches, I want to respond to a few points that have been raised. The hon. Member for Erith and Thamesmead (Teresa Pearce) mentioned the 12% savings suggested by Her Majesty’s inspectorate of constabulary. We can have a political argument about whether cuts should be 12% or 20%, but as many people have asked—certainly in my constituency—if savings of more than £1 billion a year can be so easily identified, why have they not already been made over the past 10 or 15 years? Clearly, there is a lot of fat in the system and savings can be made. An analogy was made between that system and MPs and their researchers, and it was asked how we could do our jobs without back-office staff. Is it suggested that no savings whatever can be made? Her Majesty’s inspectorate of constabulary has identified savings of 12%.
Barbara Keeley (Worsley and Eccles South) (Lab)
Will the hon. Gentleman give way?
Mr Burley
I will give way in a moment. Do people think that police forces cannot work more efficiently and be less bureaucratic, that we cannot get rid of some form filling and red tape, and that there cannot be greater efficiencies in procurement and when buying IT systems? I suggest to hon. Members that a lot of efficiencies can be made.
Barbara Keeley
The cuts announced in Greater Manchester last week will affect 900 jobs, including crime scene investigators, forensic scientists and call handlers. Does the hon. Gentleman think that the second largest police force in the country can support the loss of hundreds of such jobs?
Mr Burley
As I said, it is up to individual police forces to manage their work forces and budgets. For example, my constituency is in Staffordshire, where numbers of police officers are not being cut. Instead, the police estate has been reduced—quite controversially, given some of the comments about police buildings—and the number of police stations has been rationalised from nine to six. Locally, there has been an outcry over the closure of three stations, but the chief constable suggested that instead of having nine stations that are half used, under-utilised, dilapidated and made of old Victorian bricks, and which cost £1 million a year to maintain, it would be better to close three stations and put the money into front-line services, PCSOs and the police officers mentioned by the hon. Lady. It is easy to jump on the bandwagon on closing police stations, but the most forward-thinking forces manage their budgets and staff in an innovative way that protects the front line and reduces costs in other areas.
Police numbers have been mentioned several times. Let us be clear: the Labour party refused to guarantee police numbers at the last election. As hon. Members know, the right hon. Member for Kingston upon Hull West and Hessle (Alan Johnson) was famously asked by Andrew Neil whether he could guarantee police numbers, and his response was no. When the hon. Member for Gedling (Vernon Coaker) begins the winding-up speeches, perhaps he will tell us how many police officers would be cut under the Labour party’s proposals to cut by 12% rather than 20%.
There has been some debate about the front line, but an agreed definition of what constitutes the front line does exist. HMIC has stated that about 68% of police staff are involved in every day, visible contact with the public or specialist roles to keep people safe and within the law. That is the definition of the front line. It is important because some of the toughest front-line roles that I have seen in the police force are carried out not on the streets but on computers in police stations by those who watch hard-core pornography involving children being tortured and murdered. To me, that is the hardest front-line job within the police force.
I wanted to intervene on the hon. Member for Hartlepool (Mr Wright) to point out that there is a difference in the roles done by police officers. I often hear comments such as, “If I am on the front line, there is a fight in a pub, it is pouring with rain and I am running towards that fight, I know that I will possibly get a kicking and be spat at.” That is a front-line, hard role in a big fight between drunk men in a pub on a Saturday night, and there is a difference between that and people sitting in a station working a nine-to-five shift. Front-line officers say that it is unfair that those in the stations are often paid more than those who run to the fight in a pub on a Saturday night, because they have done 10 years in the police service with an automatic pay increase every year. There are different roles within the police force, and I do not see a problem with people being paid according to the difficulty of their role. If people disagree with me about that, I would be interested to hear from them.
I will make just two final points to allow the Minister and the shadow Minister time to respond. First, on pay and conditions, it is not true that most police officers will face a £4,000 cut; a lot of officers will actually have a pay increase under Winsor’s proposals because they will be doing front-line duties. At the time of the last police review—such reviews seem to happen every 20 or 25 years—a special payment for front-line duties was given to about 89% of officers and rolled into the general salary. It could be argued therefore that the police already receive an extra 9% pay on top of their basic salary. Winsor could have removed that compounded extra payment, but instead he left it in the basic salary and proposed an extra increase in pay for some officers, based on the difficulty of their job and whether they are on the front line. The police get a fairly good deal, and some will get an even better deal under the proposals. Some, of course, will lose out because they are not undertaking difficult roles on the front line.
As I pointed out, there is amazing job security in the police service, and that should be reflected in the pay and conditions. I challenge any hon. Member to intervene on me and tell me another public sector job that someone can join aged 18, from which they cannot be made redundant—other than for gross negligence—and from which they can retire after 30 years, often as early as age 48, on two-thirds of their salary for the rest of their life. There is no single comparable job in the public sector.
Teresa Pearce
My example is that, as we have said previously, policing is different. Does the hon. Gentleman think that it should not be different and that the retirement conditions are the only perk that the police have and that they should not even have that?
Mr Burley
I think the police have a lot of perks; I pointed out that the retirement conditions are a unique condition. Does the hon. Lady say that being in the Army, Air Force or the Navy is somehow less dangerous? Surely, fighting in Afghanistan is more dangerous than a lot of police jobs. The job security in the police service is unique in the public sector, as is the fact that police officers cannot be made redundant.
In answer to the hon. Lady, yes, I think that the police should change their terms and conditions. The hon. Member for Birmingham, Erdington (Jack Dromey) made a fair point when he alluded to the fact that if, as we are now seeing, chief constables have to manage their work force and make reductions in the head count, the only people whom they can make redundant are police staff and PCSOs. Those people have different terms and conditions from police officers, who are warranted officers of the Crown, and that is unfair. All hon. Members would agree that we need a mixed work force in the police; we need police staff, PCSOs and police officers. It is unfair on staff and PCSOs that their terms and conditions mean that, in times of cuts, they are inevitably the only people who can be made redundant. Chief constables are not able to get rid of some of the dead wood, as they may wish. If we believe in a mixed work force in the police, we should believe in the same terms and conditions for all parts of that work force.
Barbara Keeley
We are talking about regulation A19 of the Police Pensions Regulations 1987 and the retiring of experienced police officers. I wonder whether the hon. Gentleman agrees with the constituent who came to see me, who finds himself, after four years, as the most experienced police officer in his unit and who was forced, as many police officers now are, to contact officers who had been retired through the A19 process to pick their brains about cases with which he was dealing. Does the hon. Gentleman think that that contributes to effective policing?
Mr Burley
No, I do not. A good chief constable should not be retiring officers who have such experience and who they think can make a huge contribution to their force. The point, as I said earlier, is that they do not have to do that. The Government are not forcing any police force to retire officers with loads of experience, and the best forces are not doing that. However, the point remains that they have to deal with the cuts.
We are not blaming police forces. We are not blaming Chris Sims for getting rid of his officers with 30 years’ experience. Police forces have to deal with the massive budget deficit that the Labour Government left us, so it is the previous Government whom we are blaming for the cuts having to be imposed on police forces, which are doing their best to deal with them. We blame not the police forces or the chief constables, but the previous Labour Government.
Sir Alan Meale (in the Chair)
I am well aware that only one more Back Bencher wishes to speak. My difficulty is that we need to bring the Front-Bench spokesman in, so that he can get answers and responses to the questions that have been posed. However, as the hon. Member for Lewisham East (Heidi Alexander) is the only one and has quietly waited all through the debate, I shall call her to speak. I ask her to be very brief.
Heidi Alexander (Lewisham East) (Lab)
Thank you, Sir Alan. I will take one or two minutes. I came to the debate today to put on the record my concerns about the cuts to the safer neighbourhood teams in London. In my constituency, we are experiencing a halving of the number of safer neighbourhood team sergeants. My concern is that those individuals are very visible and very effective and will be sorely missed in the communities that they serve. A big row has broken out about police numbers, but safer neighbourhood team sergeants play an important role in reassuring the community and making the public feel safer, and a number of wards in my constituency will be left without sergeants dedicated to them. That is of huge concern to me, and I should like the Minister to respond to it.
Vernon Coaker (Gedling) (Lab)
I congratulate my hon. Friend the Member for Erith and Thamesmead (Teresa Pearce) on securing the debate and on the excellent points that she has made. All the Labour Members who spoke described the real dangers and difficulties facing the police forces of this country. The debate should resonate up and down the country, because I fear that the Minister will do exactly the same as every Minister has done since the Government were elected, which is to ignore the voice of the police telling them that the budget cuts being introduced go too far and are happening too fast, and that the reforms and changes that the Government are making are causing real difficulties. I fear that the Government will plough on regardless. We saw that yesterday in the speech that the Home Secretary made to the ACPO conference straight after the president of ACPO, one of the most senior police officers in the country, had said that there is a real danger with what the Government are doing with respect to the police—risking community safety in this country.
Irrespective of what the hon. Member for Carshalton and Wallington (Tom Brake) says, I am sure that when he goes out and meets police officers in his constituency, as all hon. Members do, he will recognise the work that they do. However, he and all other Government Members in the Chamber have to recognise that the policies that they are supporting and voting for in the House of Commons day in, day out are causing the problems that officers have. That is the reality. Government Members can sympathise and say to them, “Yes, this is difficult. I understand the problems you have,” but the only way to make a real difference is to vote differently. The alternative is to stand up to those officers and say, “I don’t care what you’re telling me about the reductions in the numbers of officers and police staff, the changes to your pay and conditions and all the other changes being made. I know better than you do and I’m going to carry on supporting the Government to deliver it.” That is the reality.
When the Minister responds to all the points made by my hon. Friend the Member for Erith and Thamesmead and all the other hon. Members who have contributed, he will lay out the Government line, Mr Meale—Sir Alan. I should explain that I have known Sir Alan for so many years as a Labour MP that it is difficult to get used to his new title.
In the time available, let me quickly run through some aspects of the Government’s line. Obviously, I will give the Minister a few minutes to respond.
First, let us deal with the budget cuts. My right hon. Friend the Member for Delyn (Mr Hanson), who was the last Police Minister in the previous Government, set out what we had said on budget cuts. At no time did the previous Government say that they did not propose to make any cuts, and at no time have the current Opposition said that we do not propose to make any cuts. What we did say was that we would listen to what the inspectorate said and conform to its professional opinion. Why? Because the inspectorate told us that what was proposed could be done without impacting on the front line. Through changes in collaboration, IT and procurement, the savings could be made without impacting—to deal with the point made by the hon. Member for Cannock Chase (Mr Burley)—on police officer numbers, although of course the chief constable would have discretion within that. That was the point that my right hon. Friend the Member for Kingston upon Hull West and Hessle (Alan Johnson), the Home Secretary in the previous Government, was making.
Cuts of 12,000 and 16,000 in the numbers of officers and police staff will have a huge impact on our communities. People sometimes say that this point is a bit trivial, but I do not believe that any Government Member who voted for the budget cuts stood at the last election saying that we have too many police officers. I can guarantee that. It would be nonsensical. We say that we will listen to the public. I have yet to meet anyone outside the House who says that we have too many police officers. They may say that officers are not doing what they should be or that they should be doing this or that, but they do not say that there are too many of them. That is why the hon. Member for Carshalton and Wallington voted against our Budget last time and stood on a manifesto promising thousands more police officers. People want to see more police officers—whether uniformed officers, specialist officers dealing with sexual violence or domestic violence, detectives or specialist officers dealing with economic crime—in stations working 9 till 5, I might point out; it is not only officers out on the beat who make a significant difference.
We see all these budget cuts before us. In addition, the defence police face significant cuts. The issue that my hon. Friend the Member for Erith and Thamesmead has raised for debate is the impact of Government policies on policing. Let us run through a couple of the other policies. The Minister will not be able to respond to this.
The National Policing Improvement Agency is being abolished. What is happening to all its functions? The Government do not have a clue. That is the answer. They are clueless. They have no idea. They are making it up as they go along: “We’re going to put a bit here and a bit there, but we’re not sure.” They said that they would abolish the NPIA in April 2012 and create the national crime agency later, in April 2013, with the NPIA functions probably going to the NCA. Then someone said, “You’re abolishing the NPIA a year before the NCA is created,” and the Government said, “Oh dear.” No one could make it up. The Government are abolishing the NPIA—where are all its functions going?
The national crime agency is to be established. There is no legislation for it at all. We have no idea about it. The hon. Member for Carshalton and Wallington says, “We’re going to have a co-ordinating function here and a co-ordinating function there.” The previous Government’s manifesto proposed a border police force. Now we have a co-ordinating police border command. The Minister needs to explain to the Chamber and to the police the direction and control arrangements of the national crime agency. The national crime agency document says that the chief constable of that organisation—who is now a secondee, not an appointment, because the Government messed that up as well—will have direction and control. Does that mean that the Metropolitan Police Commissioner will not be able to determine what happens at Heathrow airport and that the national crime agency will, because it is co-ordinating border command? What about the chief constable of West Yorkshire dealing with Leeds airport? Who has direction and control there? Is it West Yorkshire police or the national crime agency? The Government do not have a clue about that.
We have the Winsor review, the Hutton review and the Neyroud review—we have not even mentioned Neyroud. All those things are going on at the same time. What is important about the Winsor review is that it is before the Police Negotiating Board, but such things are not meant to be negotiated. Will the Minister confirm that this is a job lot? We either take it or leave it. We cannot negotiate individual bits; the whole thing must be agreed. The “N” in PNB stands for negotiating; this is not about the Government dictating to the police what they should do. These things are supposed to be negotiated, but, again, the Government have not done that.
No wonder police morale is at rock bottom, as my hon. Friends have said. Of course, we should not worry; the Government will carry on regardless and they will not listen. It is all right the hon. Member for Amber Valley (Nigel Mills) saying that he is a member of the parliamentary police scheme—that is very laudable—but the police actually want a Government who take into account, and respond to, what they say. I challenge the Minister to say what significant change the Government have made as a result of what the police have said. There is not one. No wonder the police feel disrespected, undervalued and demoralised—so would I if the Government did not take the slightest interest in what I said.
Finally, there is accountability. The Government will not even publish the responses that they received to the White Paper proposals on police and crime commissioners. They had 800 or 900 responses, but they will not publish them. Instead, they published a summary. Why? Because, by and large, those who responded were not in favour of the proposals. Will the Minister tell us who supports police and crime commissioners, apart from Government and right-wing think-tanks, the hon. Member for Cannock Chase (Mr Burley), a few other Tory Back Benchers, the Prime Minister and Lord Wasserman? He cannot. The Government should not just praise the police—we all do that, and it is obviously important—but it is about time they listened to them and acted on what they are saying.
The Minister for Immigration (Damian Green)
Congratulations on your elevation, Sir Alan. I join others in congratulating the hon. Member for Erith and Thamesmead (Teresa Pearce) on securing this important and timely debate. Everyone on both sides of the House recognises and applauds the vital work done by police officers, from chief constables such as Chris Sims to the most newly recruited PC on the streets. In the short time available to me, I want to address many of the issues that have been raised.
Damian Green
I must apologise to the hon. Lady; I will not. I have eight minutes in which to respond to a very dense debate.
Our vision for policing can be expressed quite simply: the police have a clear mission to cut crime. Our entire approach is designed to support that mission through a comprehensive and clear programme of reform. There are four key elements to our programme: improving democratic accountability; ensuring greater transparency and engaged communities; increasing efficiency and value for money, and returning discretion to the professionals; and getting a stronger grip on serious, complex and organised crime.
Of course, reducing the budget deficit remains a priority, and the police service will have to play its part. A 12% cash reduction in central Government funding over four years, which is equivalent to 20% in real terms, is a challenging but manageable settlement for the police. In real terms, the average reduction in central Government funding to the police will be about 5.5% per year.
However, Government funding is not the only source of funding to the police. About a quarter of their funding comes from the police precept component of council tax. If the precept is increased in line with forecasts from the Office for Budget Responsibility, the spending review settlement will represent only a 6% cash reduction in total funding by 2014-15, which is equivalent to 14% in real terms. Those figures show that although the reductions are challenging, they also are achievable. By introducing the reforms I have mentioned, we will create a police service that is more efficient and responsive to local demands, despite the inevitable funding reductions that it will face in the coming years.
That touches on the central incoherence in the points made by the hon. Member for Gedling (Vernon Coaker), who speaks for the Labour party. The former Police Minister, the right hon. Member for Delyn (Mr Hanson), who performed that function admirably, admitted in public that the previous Government were going to cut police budgets. Subsequently, in one of the Opposition’s flirtations with honesty, the former Chancellor of the Exchequer, the right hon. Member for Edinburgh South West (Mr Darling), announced that he would have had to introduce much more serious cuts across the board had he remained Chancellor after the election.
Although the former Chancellor was perfectly honest about the fact that he would have announced some cuts, and although former colleagues of his in the previous Government have admitted that the cuts they would have introduced would have been much bigger, the tone adopted by Opposition Members throughout the debate has been that any change or reform would be disastrous for the police service. Their approach is simply incoherent. Had the Labour party remained in government, they would not have taken that line.
Damian Green
The right hon. Gentleman knows as well as I do that the figure under the previous Government would not have been £1.3 billion. That is what they told us before the election, but we now know that they would have told us something completely different after the election had they been re-elected.
Let me move on to some of the points that have been raised. On improving democratic accountability, the hon. Member for Gedling asked me who had approved the proposals for police and crime commissioners, and the answer is the House of Commons, which voted for the legislation.
Damian Green
We are in the process of swapping bureaucratic control for democratic accountability by replacing police authorities with directly elected police and crime commissioners. Despite the recent vote in the House of Lords, which the hon. Gentleman refers to, the Government anticipate that police and crime commissioners will be introduced across the whole of England and Wales, with the first elections taking place in May next year. The coalition agreement made that clear. We fully intend to go ahead with the proposals, and we expect the Commons to reinstate the policy.
As I said, the second element in our reform programme is increasing transparency and creating engaged and active communities. That will help communities, which is important, but it will also help police engagement with communities.
The third element of our reform programme is introducing local professional discretion to help to increase efficiency and value for money. That is directly relevant to the many points made about morale. As we all know, there has been too much unnecessary paperwork over recent years.
Damian Green
I am sorry, but I really have not got time.
That has happened as a result of central Government adding layers of bureaucracy to make up for the lack of local accountability. The Government have taken the lead in cutting interference from the centre in police business. We want to respect the police’s operational independence and to give them the space they need to deal with any problems. That is why we published a draft protocol setting out the roles and responsibilities of police and crime commissioners, chief constables, police and crime panels and the Home Secretary. The protocol was drawn up in discussion with, and has the full agreement of, ACPO, including Sir Huge Orde, the Association of Police Authorities and the Association of Police Authority Chief Executives. It builds on recommendations from the Home Affairs Committee.
On top of that, we have axed many of the unnecessary bits of paperwork that had built up over the years. The policing pledge, public service agreement targets, performance indicators and local area agreements have all been scrapped. In their place has been put the one simple objective of cutting crime. The hon. Member for Gedling asked what we had done, and those measures are a significant answer.
We will continue to make decisions that improve the performance of the police and their relationship with the general public. Let me deal with that in detail. Mention was made of funding in Metropolitan police areas. The Metropolitan Police Service receives specific funding for its role of policing the capital. That funding comes in the form of national, international and capital city grant and totals £200 million this year. As with any force, we will consider requests for additional support where the costs involved in any single operation are significant and place an unmanageable burden on the Metropolitan police.
Inevitably, we have discussed the Winsor review extensively. The Government have been clear that action is needed to tackle the deficit, and the police service has its part to play. In an organisation such as the police, where pay is 80% of revenue expenditure, there is no question but that pay restraint and pay reform must form part of the package. Police officers should be rewarded fairly and reasonably for what they do. That is why the Home Secretary asked Tom Winsor to undertake his review. The review is not only about savings, but about making reforms to enable the introduction of modern management practices and to maximise officer and staff deployment to front-line roles, maintaining and improving the service to the public. The principles Tom Winsor sets out in his report provide the right framework, and we have referred his recommendations for short-term change to the relevant bodies for consideration.
Damian Green
I am sorry, I really cannot.
We have talked a lot about whether the cuts can be achieved without damaging the front line. Denis O’Connor of Her Majesty’s inspectorate of constabulary estimated that £1.15 billion could be saved if the least efficient forces brought themselves up to the average level of efficiency. We want forces to reach the standards of the most efficient, not just the average.
There are also areas outside the remit of HMIC’s report, including Government and IT collaboration, where further savings can be made. Indeed, my right hon. Friend the Home Secretary made an announcement about that yesterday, which will be significant. In terms of officers opting out of the pension scheme—
Packaging Industry
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
Mark Pawsey (Rugby) (Con)
It is a pleasure to serve under your chairmanship, Sir Alan. I am pleased to see the Minister and so many other hon. Members in the Chamber.
I want to consider the difficulties faced by an important industry in the UK: producers and distributors of packaging products. The matters I want to raise fall broadly into three categories: issues affecting industry generally; the cost inputs by which the packaging industry is affected, particularly energy and international competition; and the impact of packaging on the environment. I realise that of those three items only the first is specifically the responsibility of the Minister and his Department, whereas the second is broadly that of the Department of Energy and Climate Change, and the third of the Department for Environment, Food and Rural Affairs, but I am pleased that the Minister of State, Department for Business, Innovation and Skills, the hon. Member for Hertford and Stortford (Mr Prisk), is to answer, because I want to dwell on the broader issues affecting an important business sector.
We all recognise packaging when we see it. It performs an important role in our lives. The container that food is sold in protects the product and reduces spoilage, keeping it fresher for longer. Packaging exists only because other products exist. First and foremost it is a delivery system for other products. As to its impact on the economy, the UK packaging manufacturing industry has a turnover exceeding £11 billion, with 85,000 employees, representing approximately 3% of UK manufacturing output. It is recognised by the Minister’s Department as an important part of the green economy; it has a role as a major recycler and as a reuser of recycled material. The sector has contributed to raising the UK’s packaging waste recycling record over 10 years from just 28% in 1998 to 65% in 2008.
I believe that I have some authority to speak on packaging because of my career background before entering Parliament. In 1979, as a 22-year-old fresh from university, I joined a company called Autobar Vending Supplies as a graduate trainee. The business’s product range originally consisted of beverages for the drink vending sector, but also, importantly, included disposable plastic cups. The range of cups led the business into supplying a broader range of catering, disposable and food packaging items. As an aside, I draw attention to the fact that the model of that business is, regrettably, seen less frequently today; it was owned by an entrepreneur, who had a strategy of building up sales of a range of products to a level where it made sense to acquire a manufacturer or to start up manufacturing from scratch, so as to control quality and delivery, and retain the manufacturing profit. It is a shame that today the perceived complexities of running and managing manufacturing businesses mean that the strategy would probably involve sourcing the products in volume from an overseas manufacturer.
In my early years with the business I was involved in sales of goods manufactured in the UK by businesses such as Mono Containers, Autobar Vendabeka and Fibracan. At that time, in 1979, the catering disposable sector was growing fast. In 1974 McDonald’s opened its first restaurant in the UK, in Woolwich, serving in-store customers and those who wanted takeaways with products in the same disposable type of packaging. That started to change people’s attitudes towards the use of packaging more broadly.
Susan Elan Jones (Clwyd South) (Lab)
It is rather heart-warming to hear the hon. Gentleman talk about home-grown British packaging businesses. He may know that north-east Wales has been badly let down by Tetra Pak, a company that had net sales of €9.98 billion in 2010, but which closed down an entire operation with a loyal work force. Will he, with me, implore the Minister to speak to the company again, especially as the Rausing family is an extremely large donor to the Conservative party?
Mark Pawsey
I shall come on to the pressures that the industry has faced, and some of the actions that we may ask our Business Minister to take on behalf of that business and others.
Kate Green (Stretford and Urmston) (Lab)
I am very pleased that the hon. Gentleman has secured the debate. Nampak Plastics in my constituency would welcome his comments about the need to support UK industry, and the need for home-grown businesses to thrive. However, it would point out that those things also have to do with the raw materials being home-grown. It is concerned that the waste products that can be turned into recycled packaging material cannot be processed in the UK because of an insufficiency of suitable waste recycling plants. Does the hon. Gentleman share my wish for the whole product chain to become, as far as possible, a home-grown industry, with British industries supported throughout?
Mark Pawsey
The hon. Lady makes a good point: we need the industry to go from start to finish, recycling a product and bringing it back. There have been difficulties about planning consents, and the Minister may be able to comment on changes in the planning system that will enable some of the new processes and facilities to come online.
Neil Carmichael (Stroud) (Con)
I welcome the debate; it is excellent that my hon. Friend has secured it. There is another issue that we need to explore in relation to the supply chain, which is the enforcement of regulations. In my constituency, silage from farms is covered with black cellophane. That is, effectively, being exported to China, where it might be dealt with inappropriately, when it is needed here for plastic recycling, to be turned into bin bags. We would be greatly aided in tackling that by the enforcement of existing DEFRA regulations. I know that Lord Henley is busy working on that, but we would welcome consistency and long-term planning on that front.
Mark Pawsey
My hon. Friend makes a good point: recycled material should be seen as a resource. It should be used and valued, whereas historically we have put it into landfill. He is right to say that, increasingly, large proportions of recyclable materials are being sent overseas to be manufactured into products.
I was talking about the growth in the use of packaging, particularly in the food service sector, because of the advantages of disposable packaging over reusable products, and the role of packaging more generally. In my business, our challenge was to enable a customer to get hot food products home still hot, and in one piece.
In 1982, I formed my own business supplying catering disposables and food packaging to businesses throughout the midlands. In the 30 years that I have been involved in the industry, it has seen substantial developments in food-service packaging. The greater use of disposables arrived at the same time as changing lifestyles, with people eating more regularly on the move or grazing, and there has been a substantial growth in the hospitality industry, and the development of mass-catering at far more venues. That has led to a variety of innovations. Sandwiches represent an interesting development; at the outset they were packed in paper bags, or possibly wrapped in cling film, but then there were containers made of moulded plastic and, more recently, of moulded coated board with a heat-seal to preserve the life of the product.
David Simpson (Upper Bann) (DUP)
I congratulate the hon. Gentleman on securing this important debate. I declare an interest: I have a company in the agri-food sector. The hon. Gentleman will be aware that there have been scares in the food sector in the United Kingdom, whether justified or not. Concerns have been raised about the use of recycled cardboard in the food sector because it may contain mineral oil. Although there is no firm evidence that it could be a health risk, does he agree that the packaging industry, whether it deals with cereals or whatever, needs to address the matter to prevent such health risks developing?
Mark Pawsey
The hon. Gentleman makes a good point about the use of recycled materials. We need to be careful about products that come into contact with food. I shall speak later about a recycling project with which I am familiar, but the recycled products are not for food use.
I referred to recent developments in food packaging. The speciality coffee sector is another case; the producers of better-quality coffee are able to distinguish their products by presenting them in board, rather than the less expensive plastic or expanded polystyrene foam. Throughout my time in business, I saw catering disposables and packaging being used as a marketing medium—a device on which to print a name, logo or marketing message to convey the nature of the business. My experience of the catering disposable sector has given me such a knowledge of its products that I often joke with friends that I could speak for more than an hour on the various methods of packing a hamburger, but I shall not inflict that on the House. However, like sandwiches, hamburger packaging represents a good example of development. We moved from the paper bag to wrapping in foil, and then went from expanded polystyrene to the folded and glued board carton with which we are familiar today.
One thing that encouraged me, as a new Member, to apply for this debate was the fact that I have joined the all-party group on the packaging manufacturing industry, and I am pleased to see a number of its members here today. I was encouraged to join the group not only because of my experience in the packaging sector, but because a substantial manufacturer is based in my constituency of Rugby. Ball Packaging manufactures one-piece aluminium drink cans, and I was pleased to visit its highly automated high-tech plant only last summer.
Rory Stewart (Penrith and The Border) (Con)
I congratulate my hon. Friend on securing this debate. Following his observations on the company in his constituency, does he recognise that the packaging industry is not just important as an industry, but provides a lot of model companies for Britain? For example, Innovia in Wigton is investing a great deal in the local secondary school, the Nelson Thomlinson school; it provides good apprenticeships, spends more than £8 million a year on research and development, and has achieved 92% exports from the far west of Cumbria. Could we please include in this masterful discussion an account of the good company practices of the packaging industry?
Mark Pawsey
My hon. Friend makes a good point. I shall speak later about concerns that have been raised about the effect of packaging on the environment. However, that pressure has caused industries in the sector to become good neighbours, and to work with their communities and undertake exactly the kind of work to which my hon. Friend refers.
At a meeting—probably my second—of the all-party group, I was concerned to hear what the manufacturing companies had to say. One comment stuck with me for some time. One or two people said that the pressures on the packaging industry were such that people present believed that the industry might not exist in its current form 15 years from now. Given the number of people employed in it and its importance to our economy, that struck me as a significant statement, and one that deserves further attention.
Neil Carmichael
The industry will continue to exist, because we will still need packaging, but we should celebrate the fact that the industry is capable of huge technical advances. Nampak in my constituency, which makes bottles for Dairy Crest, has made some great strides in reducing the weight of its bottles, stopping leakage and so forth; the product is almost perfect now, and much less wasteful. Critically, that manufacturer is using high technology and will continue to develop—for example, by moving to products that are less dependent on oil. Those are things to celebrate.
Mark Pawsey
I shall speak later about some of the industry’s innovations in response to the pressures, and my hon. Friend gives a great example.
Given those concerns, I turn to matters to do with the environment and energy costs. I understand that many of them are not the direct responsibility of the Minister’s Department, but I am sure that he will appreciate the concerns of this important manufacturing sector. Given the challenges faced by industry more generally, manufacturing has been and continues to be an important part of the UK economy, adding £140 billion per annum to the economy and providing 2.5 million jobs, but it has been badly affected over the past 10 or 15 years and particularly by the recent recession. He will be aware that industry generally considers it vital to provide the right conditions to ensure that manufacturing can succeed in a globally competitive environment. It is important that the Government deal with the barriers that businesses face, such as finance, regulation, tax and skills.
Despite the recent slow-down in global growth, the world economy is predicted to double in size over the next two decades, with massive growth in emerging markets such as China and India. It is important that the UK’s manufacturing sector is able to take advantage of such opportunities. The good news is that manufacturing output rose by 1.3% in April and that, in 2010, manufacturing output grew by 3.6%—the fastest since 1994. The Government place a high priority on helping manufacturing firms to invest, and they have cut the main rate of corporation tax to 26% and the small profits rate to 20%.
In addition to encouraging investment, industry needs new recruits. We need to encourage school leavers to consider a career manufacturing. In many ways, that will require a change in culture, as we must give an incentive to school leavers to consider manufacturing. The UK skills shortage is recognised by Proskills UK’s chief executive, Terry Watts. He said that the skills shortage in the manufacturing sector is costing the UK £118 million in lost productivity. He also said that the Government should
“do more to espouse the whole of manufacturing, and not just the high profile industries.”
We should also consider the process industries that are not as high-profile as manufacturing, recognising that industries such as packaging are fundamental to the development of the whole economy.
The Government take the skills shortage seriously. Addressing the shortage means increasing the number of apprenticeships and technical training opportunities. In a positive move, the Government have said that they will fund an additional 80,000 work experience places for young people and expand the programme of universities and technical colleges.
Lorely Burt (Solihull) (LD)
I agree with what my hon. Friend says about the need to increase young people’s awareness of the opportunities that exist in manufacturing. Does he agree that we need to shake up the image that the careers service has of manufacturing? I am talking about the idea that engineering is an oily rag type profession. The service should lay before our young people all the potential that manufacturing offers as a career.
Mark Pawsey
My hon. Friend makes a good point about the image of engineering. As west midlands MPs, we both know the importance of engineering. As a father of children who have recently gone through school, I recognise that the case for going into industry and getting involved in manufacturing has not been put sufficiently strongly by the careers service. We want to change that attitude in the hope that some of those bright young people who are coming from the technical colleges will find their way into the packaging industry, whether through design and innovation or through their input to the manufacturing process.
Let me turn now to the challenge of competing in world markets and energy costs. The production of packaging—the process by which paper, board, glass and metals are manufactured—is energy intensive, and the energy agenda affects the packaging industry and packaging manufacturers disproportionately. The packaging industry produces large volumes of low-value items. The cost of a box, can or bottle is measured in pence per item and the cost of a bag measured in points of a penny per item. A significant increase in energy costs will have an impact on those items.
The Government aim to reduce carbon dioxide emissions to 50% of the 1990 level by 2027. The packaging industry fears that that objective, together with other plans, will put UK manufacturers at a greater disadvantage than those located elsewhere in the world. It feels that the UK expects too large a carbon reduction in too short a time.
The think-tank, Civitas, recently prepared a report on the effect of energy prices on the chemical industry; the effect on packaging would be pretty much the same. Civitas states:
“Britain is making the deepest emission reductions of any industrialised nation. The 2020 34% target is 14% higher than that of any other EU nation. The latest carbon budget now commits the UK to emission targets beyond 2020, the first country in the world to do so. To meet these over-ambitious targets, high unilateral costs are being imposed, such as the new carbon price floor. Taking all green levies into account, the average energy-intensive company’s energy bill is set to rise to £17.5 million by 2020 from the current £3 million.”
Lorely Burt
My hon. Friend is being very patient with me this morning. Is he aware of the National Industrial Symbiosis Programme, which works across industry, thinks outside the box and uses other firms’ waste and by-products? Since April 2006, its 12,500 members have reduced by 7 million tonnes the waste that would have gone to landfill, and they have reduced carbon emissions by 6 million tonnes. Would he like to see that extended to all industries throughout the country?
Mark Pawsey
My hon. Friend makes a good point about the industry’s activity. None the less, I want to focus on the concerns that a cost input of the industry is significantly out of line with that of similar manufacturing companies based elsewhere. I shall add to the Civitas quote. The think-tank said:
“The response to the price hike”—
in energy costs—
“will be industrial emigration. Companies, especially multinationals, will leave the UK to settle in countries with lower energy prices and fewer punitive costs. Those who cannot afford to relocate will likely fold. In the long-term, foreign investment will also dry up, leaving the UK an industrial backwater.”
That is a real concern for companies involved in manufacturing, especially in this sector.
Mike Crockart (Edinburgh West) (LD)
I thank my hon. Friend for giving way so many times. Although it is undeniable that we need to deal with climate change, is he not worried that we might not only lose industry abroad, but offshore our CO2 emissions, which effectively means that we do not deal with the problem at all?
Mark Pawsey
I want to address that point a bit later. My hon. Friend is right. All we end up doing is moving more product around rather than manufacturing it in the place where it would be most sensible to do so. In that movement, we generate additional carbon dioxide.
On business investment plans, one of the key things that business needs to do is estimate future costs of raw materials and energy, of which energy is often the most significant. There is already an account of the Business Secretary having had his ears burned by industry leaders about energy costs. If other countries do not follow our lead, the concern is that packaging manufacturers might move away from their UK bases. A number of people involved in the industry have said that a large proportion of UK plants producing packaging are now owned by companies that are based overseas and that if energy prices or regulation in the UK become excessive, there is no reason why those overseas-based multinationals would continue to keep those businesses in the UK.
Let me touch now on the standards under which imported products are manufactured. Manufacturers based in the UK, particularly those involved in producing packaging for food, incur costs by ensuring that they are compliant with all relevant food safety and hygiene legislation, but that is not the case for competitors based outside the EU, which puts UK-based manufacturers at an economic disadvantage. If such packaging is supplied without the recognised accreditation concerning EU food safety and hygiene, the concern is that there could be health risks to consumers.
Another strand of my argument relates to packaging products being seen as an obstacle to a greener environment and a greener economy. The Prime Minster has pledged to make this the greenest Government ever. One of the ways in which the Government aim to achieve that is by reducing the amount of packaging used and encouraging even more recycling. The industry accepts that its product is highly visible; we see it around us all the time. None the less, its environmental impact is much less than many would presume. Less than 3% of land-filled waste is packaging waste, despite the fact that 18% of household waste comes from packaging. It is accepted that packaging is visible because of litter. By definition litter is waste that happens to be in the wrong place. It is created by individuals through thoughtless or antisocial behaviour. The industry has a responsibility regarding litter, but it argues that litter should be addressed by education, investment in street cleaning and law enforcement.
The problem is that packaging attracts media attention. I would present Jeremy Paxman as a witness. Only the other day, he spoke on Radio 5 Live as chair of the Clean Up Britain campaign and railed against manufacturers of packaging. The industry argues that the attention that it receives is disproportionate and that packaging should be seen not as a problem but rather as a resource-efficiency solution. Given all the media attention, the packaging industry feels that it has become an easy target for those who wish to present their green credentials.
The emphasis on packaging and the environment has been recognised in the waste policy review, which was recently published by the Government. That review outlines the Government’s determination to move towards a zero-waste economy by relying more on voluntary approaches to cutting waste, increasing recycling and resource productivity, and improving the overall quality of recyclates.
Broadly, the industry is pleased that the review acknowledged the valuable role that packaging plays and that, in most cases, the carbon footprint of packaging is absolutely dwarfed by that of the products that it protects. However, there is a view within the industry that the review continues to pander to public misperceptions about packaging, as it draws attention to surveys that show that consumers believe packaging remains a big environmental question. The industry is disappointed that the review does not attempt to challenge some of those misconceptions.
The industry believes that, to challenge such misconceptions about waste, customers need to understand that good food packaging reduces food waste, which in turn saves people money through lower grocery bills and reduces the amount of unused food that is sent to landfill or composting. The review refers at some length to the need for packaging to be improved further, but it focuses on toy packaging. Unfortunately, toy packaging makes up only 0.36% of packaging in the UK and it is mostly used for imported goods, over which we have no control in the UK. In addition, the review pays a lot of attention to waste prevention, with the announcement of new initiatives and funding, and it also has a stated aim of reducing food waste. Some organisations have praised the review for making commitments to work with businesses to help them to reduce wastage, rather than carrying on the old practice of handing out penalties to companies that fail to comply with legislation.
Broadly, the industry believes that it can work with the Government on the waste policy review. Dick Searle, chief executive of the Packaging Federation, has said:
“It looks like there’s nothing unexpected in here and it’s all reasonably logical. I’m sure the industry will appreciate the light touch approach. I’m very pleased to see the reference to packaging being ‘dwarfed’ by product in terms of carbon footprint. Overall, it looks like government has been listening.”
Perhaps we might consider that response from an industry to Government plans as a refreshing one.
Kate Green
I am listening with care to the hon. Gentleman and agree with much of his analysis. Does he agree that the Government have an opportunity to galvanise a cross-sectoral approach to the issue—for example, by looking at a product from beginning to end and considering packaging within that context? In the milk industry, the packaging used is responsible for only 7% of the industry’s carbon footprint and joint work by the industry and the Department for Environment, Food and Rural Affairs has enabled the entire product chain to be analysed. Does he endorse that approach to looking at environmental concerns?
Mark Pawsey
Absolutely. Cross-cutting and working together through voluntary agreement is entirely the way forward. That is the main thrust of the waste policy review, and I am delighted that the Minister has said with regard to the review:
“This Responsibility Deal with the waste management industry is most welcome. It is a good example of the way alternatives to regulation can work to achieve better waste management and recycling services for SMEs”—
small and medium-sized enterprises—
“and encourage better sorting of recyclable material to help the recycling industry.”
Voluntary arrangements are certainly the way forward and they are arrangements that industry that will respond to. Perhaps the carrot will always work better than the stick.
It is not possible to talk about the regulation of business without making some reference to Europe. European legislation and regulation are already in place under the European packaging directive, which requires the packaging industry to meet strict requirements to prevent the use of excessive packaging. Since that directive came into place, the amount of packaging waste recovered and recycled in the UK increased from 3.3 million tonnes in 1998 to more than 7.1 million tonnes by 2009.
On recycling, my experience as local councillor before coming to Parliament led me to conclude, first, that most people are pretty sympathetic to recycling and see activity by their local authority to improve recycling rates as a good thing and, secondly, that individuals are prepared to put time and effort into sorting out waste streams, so it is important for the industry to make it as easy as possible for people to identify the materials used in the manufacture of each product. For example, most Members present will know that plastic is not just plastic; there are many varieties, some of which are recyclable and some of which are not.
How local authorities go about waste collection and recycling leads to a concern that the industry has about localism, which of course is a key objective of the Government. Localism is appropriate in many sectors, but occasionally it has a downside. The packaging industry takes very seriously what happens to its products at the end of their life and, consequently, regularly engages with the authorities that are responsible for the collection and disposal of waste. Of course, for consumer goods, those authorities are local authorities.
The Food and Drink Federation has referred to the difficulty for the packaging industry of responding to the localist agenda given that there are 398 local authorities, each with a different approach and different priorities with respect to waste planning and disposal, including whether it is right to recycle or incinerate. The industry believes that the lack of uniformity across local councils makes life difficult for it in establishing contact and liaising with local councils. It also believes that it might be helpful if the Government suggested some form of unifying strategy and that, in addition, such a strategy might be of benefit with regard to dealing with litter. I recognise the conflict between that objective of the packaging industry and the broader objective of the Government to enable local people to have the right to decide, through their elected representatives, the best way forward in their area.
Given the problems that I have referred to—problems that fall into three categories—how is the packaging industry responding to the challenges that I have outlined? First, regarding its image, the industry recognises the need to convey the benefits of the products that it produces and to put forward examples of positive development and innovation. It is very clear that modern packaging solutions have enabled a huge change in the way that we shop and go about purchasing our goods, but the industry recognises that it needs to do more work to convey its message more effectively and to get across the benefits of packaging. For example, eliminating packaging from fresh produce would lead to massive food waste. The Cucumber Growers Association has conducted tests that show that unwrapped cucumbers are unsalable after three days, whereas just 1.5 grams of plastic packaging can keep the same product fresh for as long as 14 days. The industry recognises that it needs to get that type of message across.
The second response of the industry to the challenges that it is facing is innovation. The industry has been designing products with waste prevention in mind for years. Improvements in packaging design and production techniques have resulted in huge reductions in material use, which have been referred to by hon. Friends. For example, a pint glass bottle is 65% lighter today than it was in 1940; a 330 ml steel drinks tin has been reduced in weight by 63% since 1950; a 1 litre plastic detergent bottle is 58% lighter than it was in 1970; and cardboard outer packs are typically 14% lighter than they were in 1970. Given all that improvement in efficiency and despite growth in the quantity of consumer products over the years, the quantity of packaging material has increased at a slower rate. Between 2006 and 2008, when the economy was growing, there was zero growth in grocery packaging.
Innovation has been about not just reducing the quantities used, but making greater use of recycled material. In March, The Mail on Sunday reported that Coca-Cola, one of Britain’s biggest users of plastic packaging, had agreed a 10-year £200 million deal with Britain’s biggest plastics recycling firm, ECO Plastics, to turn old bottles into new. It is hoped that the Lincoln plant will produce enough recycled plastic to achieve the company’s target of 25% of its packaging being made of such material. That will help the Government to achieve their objectives of reducing the volume of plastics sent to landfill sites and of stopping tonnes of material having to be sent to China, as happens at present. Such development and innovation not only benefit the environment, but go some way towards making the industry competitive. The challenge for the industry, however, is that innovation is often recognised and copied, making any competitive advantage short-lived.
I have spoken about the industry’s support for recycling. The Save a Cup scheme to collect used plastic and paper vending cups was established some years ago, and its range has now been extended to include cans and pods. In connection with the point made by the hon. Member for Upper Bann (David Simpson) about food safety, the scheme has an online shop where people can buy trays, bins and stationery items such as pencils and rulers that have been made from the recycled material.
Although development costs are high, the packaging industry—in particular, the food service packaging industry—has looked to embrace new materials such as polylactide—PLA—and recycled polyethylene terephthalate—rPET—along with coating developments, and encourages UK companies to participate in efforts to increase local manufacturing.
We have spoken about how litter is created by individuals rather than by companies, but most companies take part enthusiastically in litter-reduction schemes. Many industry participants attended the recent parliamentary launch of the “Love Where You Live” campaign, at which Keep Britain Tidy’s ambassador, Kirstie Allsopp, acknowledged the responsibility of end users of packaging:
“Being part of Love Where You Live is a chance for the big brands to become the heroes instead of the villains in the fight against litter. Those who mindlessly chuck their fast food or cigarette packet on the floor cost our country millions and destroy the places we call home.”
Individuals create the problem but industry can help, and is doing so. In its simplest form such help can include, as part of its design, reminders to dispose of packaging responsibly, and the new “Love Where You Live” logo will start to appear on large amounts of packaging. The industry already includes information on materials used in manufacture and on how and where to recycle.
I shall draw my remarks to a close with a shopping list for the Minister of things that the industry would like the Government to consider. The first is action to stop further erosion of the UK’s manufacturing base and to ensure that packaging manufacture is not exported outside of Europe to economies that can live with a more carbon-intensive environment. The industry is keen to see greater recognition of its contribution to the UK economy, as a major UK manufacturer with £11 billion of sales and 85,000 employees, and it is keen to see support for action on ensuring a level playing field with overseas competitors, particular regarding the cost, supply and taxation of energy. It also wants there to be an understanding that carbon impact is created only by responding to consumer demand for products and that pursuing a low-carbon economy by squeezing manufacturing without addressing that consumer demand might lead to substantial UK manufacturing job losses.
The industry would like to see an acknowledgement that unilateral action by the UK Government on carbon floor pricing might end up putting the UK packaging industry and its customers at a disadvantage compared with international competitors. It also wants recognition of the progress that it has made in supporting recycling and in decoupling packaging growth from growth in gross domestic product, and it wants greater recognition of packaging’s pivotal role in protecting products and providing safe and secure supply chains for a variety of products. The industry would like acceptance that the measurement of environmental impacts must be based on sound research and scientific fact rather than on the emotive language that we occasionally hear. Finally, there is the benefit that would accrue from a little national guidance on local waste and resource management strategies.
The industry recognises that there is a need for greater dialogue between itself and the Government, and I hope that this debate will form part of that. The industry argues that it is vibrant, successful and economically important, and that it makes products that safeguard the environment, conserve resources and enable modern living. It has worked hard to address many challenges and has developed into one of the most innovative industries of its type in the world. It believes that the fears about viability that we heard expressed in the all-party group for the packaging manufacturing industry might not be as serious as presented at the outset, but that it is important for the Government to recognise the challenges.
To sum up the importance of the sector, I can do no better than to quote Steve Kelsey, the founder of PI Global, a company that developed a lightweight bottle for Stella Artois and saved carbon dioxide production in manufacture and distribution:
“Packaging is the forgotten infrastructure that is as important as clean water, electricity and highways.”
Nigel Mills (Amber Valley) (Con)
It is a pleasure to serve under your chairmanship, Sir Alan, for the second time this morning. I pay great tribute to my hon. Friend the Member for Rugby (Mark Pawsey) for that 47-minute summary of the packaging industry, which demonstrates his knowledge of and enthusiasm for it. He has made almost all the points that I would have cared to make, but I shall reinforce a few of them.
First, we should stress how important the industry is to the UK economy. The data suggest that the UK packaging manufacturing industry has annual sales of £10 billion, employs about 85,000 people and represents about 3% of UK manufacturing. This key industry constitutes a sizeable part of the economy in many of our constituencies, and it is one that we want to protect and encourage.
I have talked to the packaging manufacturing businesses in my constituency. The largest of them is, I think, BPI Consumer Promopack, which made supermarket carrier bags for many years until the business became uneconomic in the UK—the bags are now made in China. The company subsequently changed, and it now makes the heavy-duty garden waste bags that we all buy from the supermarket and spend our weekends filling. One of its product lines is a bag made by recycling the complex agricultural wrap that my hon. Friend the Member for Stroud (Neil Carmichael) referred to. The business chose to invest in recycling those complex agricultural films. The films, which can become dirty from lying around in farmers’ fields for several months, are washed in Dumfries, converted into pellets and made back into garden waste bags. Some people are trying to undercut the cost of the process by exporting those incredibly dirty films as clean waste to China, Burma or other places in the far east. It is illegal to export waste that dirty, but they are managing to export it as clean waste, because the regulations are not enforced adequately.
There is a lesson there. If we want businesses to invest in recycling, which we need in the sector, we must be sure that they have a stable regulatory base and that those regulations are enforced, otherwise their investment decisions will not be viable. As my hon. Friend the Member for Rugby has said, many of our businesses are multinationals, which consider their investments closely at board level. If investing in one territory is substantially less economical than investing in another, the investment will go where the best returns are.
That leads me to concerns about our energy policy. The industry requires substantial amounts of energy to create packaging. It does not count as an energy-intensive industry eligible for the special treatment proposed by the Government, but there is no gain to us in accidentally exporting packaging manufacturing to other countries that probably use less demanding environmental standards and then shipping it back to ourselves. I suspect that that will result in a far higher carbon footprint than manufacturing in the UK, where the industry is fully committed to becoming more environmentally friendly and using less material.
The industry tells me that its customers are adamant in wanting less packaging, because less packaging means less weight, less cost and less expense shipping products around the country. There is huge pressure in the market to make packaging as efficient and effective as possible. We do not need to get out the big stick and force the industry into it, because it has been doing so for years and wants to keep doing so. It is absolutely in its interests for the future of the business that the industry gets it right. It is important that the Government recognise that we do not want to move too fast and make ourselves uncompetitive.
My hon. Friend has discussed how we all go to the supermarket to buy a pack of potatoes and wonder, “Why do I need the plastic tray and plastic film? Why can’t I just buy loose potatoes?” What we do not understand is that from the time food is grown and shipped to when it is sold through the supermarkets and ends up in our fridges, very little is wasted—I think that it is less than 3%. Compare that with the amount of food that we waste once it is in our fridges, when we forget to eat it until it has gone off and end up throwing it away. Around the world, we are having problems feeding the population. Packaging that makes food last longer and ensures that we buy it in a safe, edible condition and do not waste it is vital to an adequate food supply. The last thing that we want to do is damage the industry. It does not have the resources or incentive to invest in the continual improvement of packaging.
I urge the Minister to recognise how important the industry is, both as a UK industry and to various other Government objectives, and ensure that we do not accidentally damage it as we chase laudable goals elsewhere. The industry clearly needs to keep investing in new machinery, new equipment and research and development. It is important that we get the R and D rules right to encourage that research to be done here and that we get the tax rules right to encourage business to invest in new machinery. We had a long debate on that during consideration of the Finance Bill yesterday. I struggled to convince the Government that reducing capital allowances to 18% in a hugely complex way is perhaps not the best way to encourage investment. I will have another go at the Minister of State, Department for Business, Innovation and Skills, my hon. Friend the Member for Hertford and Stortford (Mr Prisk), to see whether I can get an encouraging reply from that angle, but perhaps I should not hold my breath that he will contradict the Treasury.
Creating a business environment that encourages innovation and investment is the best way to reach our environmentally friendly goals. A big stick and a blunt instrument will, I suspect, lead the trend the wrong way, and we will end up importing from far-flung places things that have travelled huge distances and been made in a less environmentally friendly way than they will be if we can protect the industry in the UK and encourage it to invest.
Ian Lucas (Wrexham) (Lab)
It is a pleasure to serve under your chairmanship, Sir Alan, and to hear the hon. Member for Rugby (Mark Pawsey) tell us about his background and expertise in the subject. I was interested to hear about it. It shows the value of having Members who have experienced other worlds before coming to this place.
I should say at the beginning that I am a long-standing member of the all-party group on the packaging manufacturing industry, and I have several packaging companies in my constituency, including Ball Packaging, to which the hon. Gentleman referred, and Amcor. I confess that when I was elected—I came from another background than manufacturing—I knew little about the packaging industry, but it fast became clear to me that it was an important industry in the area, in terms of inward investment, jobs and profile in the local community. At the time, in addition to those two companies, another company, Tetra Pak, was located just outside my constituency in Clwyd South and employed many people, although regrettably that company has ceased manufacturing in the UK. Its reasons for doing so are relevant to this debate.
Early in my political career, I visited Tetra Pak and got to know the managing director of the plant well. I also visited Ball Packaging, and I was pleasantly surprised when I visited both companies. When I approached the packaging industry for the first time, my default position, like that of most of the general public, was a bit sceptical. We all have visions of toothpaste being packaged in cardboard boxes and wonder why that is, as we know that our society needs to create less waste. I therefore wondered what the purpose of packaging was. Would not an ideal world be one without packaging? Of course, I was entirely wrong in that approach, as I learned quickly. It fast became apparent to me how efficient the packaging industry is. It is efficient because it depends on two crucial drivers: energy prices and regulation. Over the 10 years that I have been in Parliament, the all-party group has always returned to those two things. They are crucial to the future of the industry in the UK.
When I first visited the packaging plants in my constituency, it became clear early on that they were very efficient in their energy use. At the time, they were much more efficient than individual consumers, because they saw energy costs as a crucial part of their bottom line. Whenever they produced items, they were keen to reduce costs as far as possible, and they worked extremely hard to do so, because energy costs are such an important part of their total costs. Energy costs have always been a major driver for the business.
The second important area is regulation. The drivers of the massive changes that have taken place in recycling and elsewhere have been defined largely by elements of regulation, often from Europe. Those drivers have had an enormous effect on progress in recycling during the time that I have been in Parliament. The hon. Gentleman referred to the improvement in recycling rates in the industry from 28% in 1998 to 67% nowadays. The reason why that is so important is that it reduces costs and is being done in response to regulation originating at a European level. We still need to pursue that regulatory goal.
[Sandra Osborne in the Chair]
We all agree with, and all three main parties supported, the Climate Change Act 2008, which will be the fundamental driver of industrial policy, and packaging policy specifically, in the UK for years to come. The Act has compulsory targets that we must achieve, because we all believe that it is important to deal with climate change. It is important that we convey the importance of that to the general public. I still do not think that most individuals—it was interesting to read about this in the papers that I received from the all-party group on the packaging manufacturing industry—recognise that climate change should be a driver in the decisions that they make when they purchase items. The fundamental driver, particularly in these difficult times, is cost. If we are serious about dealing with the profound challenges that climate change poses, we have to get across to everyone how important it is as a driver.
We need to get the regulation right, including at a European level, which means that whenever draft regulations are proposed, or regulations are introduced, Members of Parliament should engage as early as possible with business and industry in their communities. It is important that business draws to the attention of elected representatives, whether in the UK Parliament or the European Parliament, the impact that regulation can have on their businesses. It is also important that we ensure that regulation extends as far as possible across the world.
The issue of carbon leakage has been referred to on a number of occasions. Unless we reduce the carbon emissions of the planet as a whole, there is no point in reducing carbon emissions in one country alone. It is important that we reduce carbon emissions on a European level, but it is also important that we do it on a worldwide basis. We need to co-operate across the piece on reducing carbon emissions and put in place the right regulations to do so.
Business is very capable of responding to frameworks, provided that they are set early and are clear, and that they enable business to make the right choices as far as investment is concerned. Even the most challenging goals in regulations can often be achieved by industry, provided there is clarity. That clarity depends, crucially, on the relationship between Government, business and industry, the early interchange of ideas, and a close working relationship. In the past, we have not had as close a relationship as we need with the packaging industry. By contrast, we received very good news recently of substantial inward investment in the automotive sector, and of £72.2 billion-worth of orders from the aerospace sector. We have to ask ourselves why we have massive inward investment in some sectors, and the opposite in others. Last year, Tetra Pak decided, after 30 years in the Wrexham area, to cease manufacturing in the UK and to move the company’s manufacturing responsibilities to mainland Europe. It has decided to move in the opposite direction when other areas of industry are inwardly investing in the UK.
One of the reasons for the success of the UK aerospace and automotive industries is that there has been a close working relationship between Government and industry. There has been early engagement with the important issues we face, such as low carbon, so that we have excellent innovations, such as the National Composites Centre, and the automotive sector has a constructive and positive approach to the low-carbon economy in the automotive sector.
There will be long-term challenges in relation to low carbon, and the packaging industry and the demands placed on it are one of the areas that will be affected. There has to be a closer relationship, and consumers, industry and Government need to have a better understanding of the issues facing the packaging industry. There is a real threat to a large number of jobs; some 85,000 people are employed in such manufacturing in the UK. We all want more, not fewer, people to be employed in the packaging industry, so we need to make the UK the place of choice for investment in packaging companies. I am afraid that, at the moment, it is clear from the representations we all receive from the industry that that is simply not the case. We need to take a long, hard look at what is different about packaging companies and our successful companies in the UK. We need more successful companies and more successful sectors.
I talked about regulation earlier, and would like to pick up on an area mentioned by the hon. Member for Rugby: consistency of regulation as far as local authorities are concerned. Localism is a little like motherhood and apple pie; everyone is in favour of it, and would like to have a hospital on their street corner and everything sorted out between them and their next-door neighbour. In the real world, however, that is not practical. Localism, with each local authority determining different policies on waste, causes great difficulty, or difficulties that need not be there, for many businesses.
The packaging sector is efficient. I challenge everyone, including Jeremy Paxman, to visit a packaging company. I suspect that he has not visited many during his career, but if he did, he would see that packaging companies are, without exception in my experience, very efficient. If they were not efficient, they would not be in business. Their focus on cost-reduction and energy use is second to none. They work extremely hard at it. We need to ensure that they are enabled by Government to do the right thing. They need to be able to work closely with local authorities, to develop more efficient supply chains through the industry, and to ensure that waste is not made too complicated for business. That is a real problem and is part of the inevitable tension between centralised practices, which in some respects make things much easier for business, and the pool of localism, whereby there are very different approaches in local authorities. I am still unsure about why recycling practices have to be different in every local authority, and I am sure that that makes things difficult for businesses in general.
The Energy Intensive Users Group and the TUC have produced an impressive report on energy. It has some good recommendations, and I urge the Government to look at them. The sector is under pressure. It needs to be listened to more than it has been, and not just by this Government; this has been an issue throughout my time in Parliament, and when I was a Minister in the Department for Business, Innovation and Skills. This has been a difficult time for the industry, but we still have very good and strong companies in the sector in the UK. We need to ensure that those companies have a future in the UK, and that they work to provide the jobs that we all want to see in the UK economy.
First, we need to educate consumers. The cucumber packaging example that the hon. Member for Rugby gave is a good one—packaging can be a good thing. Secondly, we need a closer working relationship between the industry and Government, and perhaps the Government need to listen a little more to the industry. Thirdly, we need to work hard to get the right regulations in place, and we need to engage with all the institutions that create the regulations to ensure that they are clear and fair. That means having very early engagement.
This is a very important industry for the UK that can have a future, if we make the right choices. I urge the Government to engage as much as possible with not just the industry, but the all-party group on the packaging manufacturing industry. I am celebrating my 10th anniversary of membership of that group this year. Thank you, Ms Osborne—I note that you have magically appeared in the Chair—for allowing me to speak.
The Minister of State, Department for Business, Innovation and Skills (Mr Mark Prisk)
I congratulate my hon. Friend the Member for Rugby (Mark Pawsey) on securing the debate and, indeed, on the comprehensive range of his remarks, which demonstrate his knowledge of the industry. I do not think you were fortunate enough to have the opportunity to hear his contribution, Ms Osborne, but I know that Sir Alan and the rest of us were fascinated by the range of issues raised. I will do my best to deal with all of the 10 action points raised in my hon. Friend’s remarks and with some of the excellent points made by my hon. Friend the Member for Amber Valley (Nigel Mills) and the previous speaker, the hon. Member for Wrexham (Ian Lucas). Everyone has highlighted a different aspect of the subject.
I want to make a small plea. This subject relates to substantial areas that are far beyond my remit and come under the Department of Energy and Climate Change and the Department for Environment, Food and Rural Affairs. We work closely together, and I will do my best to answer hon. Members without creating new policies for my ministerial colleagues.
As has been pointed out, packaging is part of our everyday lives and, in a sense, is commonplace. At the same time, the different elements and materials—the metals, plastics, glass and paper—feed across the whole of manufacturing as they are very broad and are part of a wide range of supply chains. That is why it is right to say that there is a genuinely competitive role for UK industry in the sector. There have been some encouraging signs of innovation both as a discrete sector and as a process that is part of manufacturing as a whole. My hon. Friends the Members for Amber Valley and for Stroud (Neil Carmichael) have set out a couple of good examples of the kind of innovation that hon. Members across the House want to be encouraged.
As has been accurately pointed out, the packaging industry employs 85,000 people and has a value of £10 billion. In terms of the share of the manufacturing industry, it represents about 3% of the work force. It is worth noting—I am keen to put this on the record to demonstrate that we are mindful of this as a Government—that the productivity of the sector is double that of industry’s average performance. We are not talking about an industry that is sitting back and waiting for things to happen; it is very responsive. I will come to that point in a moment.
I shall thematically pull together the 10 actions mentioned by my hon. Friend the Member for Rugby and the other points made. He mentioned the industry’s role within manufacturing and what the Government can do to help, energy costs—which were raised by several hon. Members—and the broader issue of waste regulation and how that impinges both on the customers of the packaging industry, who are very often industry and business themselves, and the sector.
On the industry’s place within manufacturing, my hon. Friend is absolutely right to say that we need to make sure that we rebalance that economy. We want to ensure that an over-reliance on a too-narrow group of sectors is replaced with a broader base, so that manufacturing has a key role to play. As the Minister with responsibility for manufacturing, I include in that not only what we might think of as high-tech, but industry as a whole.
On perceptions, which were rightly raised by the hon. Member for Wrexham, in the past 12 months, there have been good signs in terms of output, investment, exports and, in some parts of manufacturing, jobs, which is encouraging. He mentioned the automotive industry. There have been some encouraging signs in the investment that Jaguar Land Rover, BMW and Nissan all want to make. There are reasons to be encouraged, and we have had a good opening year, but we need to do a lot more. That is why the Government are determined not only to take corporation tax down from 28% to 26%, but to take it on down to 23%. At the end of that process, we will be putting £1 billion back into the coffers of industry, including packaging. That money can be reinvested. As we have heard, one of the key ways in which industrial sectors keep ahead is not simply by trying to reduce costs all the time, although that is important, but by innovating to keep ahead of competitors. That reinvestment capability—the £1 billion extra a year—is a very important part of that equation.
In addition, the Chancellor set out our plans in the Budget to improve short-term capital asset release and to extend it to eight years instead of just four. From talking to a number of people in industry, I know that that is a real boon, because when people invest in an industrial project, more so than perhaps in services, the payback time is often more than four years—it is often five, six, seven or eight years, and in some cases it is beyond that. My hon. Friend the Member for Rugby knows that, because he has worked in the industry. That is another important incentive to enable the packaging industry to progress.
It is also important to bear in mind—several hon. Members made this point—that it is not only the hard capital issues that matter, because soft capital issues and skills matter, too. That is why we have made a determined change in the investment in and development of apprenticeships. During this Parliament, 250,000 additional apprenticeship places will be created. That is particularly important in an industry such as packaging, because it has to adapt and to be able to cope with conventional packaging issues and the growing issues around climate change and the environment. It is a crucial part of the equation for the packaging industry to be able to reskill its work force.
On that note, the hon. Member for Solihull (Lorely Burt), who sadly is not in the Chamber at the moment, raised a point in response to my hon. Friend the Member for Rugby on the perception of industry. Indeed, the hon. Member for Wrexham also highlighted that important matter. There is an outdated perception of industry that is often blown away when someone gets the chance to go and see an industrial facility. We note the generous invitation issued by the hon. Gentleman to Mr Paxman to visit a packaging company, and he is right: we need people to visit centres and see what an industrial facility is all about in the modern era. That is why, last week, we started a pilot project called “See Inside Manufacturing.” I went to the north-west to encourage and talk to careers advisers and teachers. In the autumn, we want to roll out the programme, so that it works not only with the automotive industry—as it does at the moment—but with the whole of industry.
I extend to the packaging industry an invitation to consider joining that programme in the coming few months, so that we can consider how we can show young people and the public as a whole the broader opportunities in that field. It is also important to change people’s perception of what is involved in the range of different careers. People often assume that the range of skills and careers in industry is narrow, but it is actually very broad and people are highly skilled in many different ways. I certainly want to see the packaging industry play a part in the “See Inside Manufacturing” programme. I will leave it to the hon. Member for Wrexham to decide whether to accompany Mr Paxman on a visit. It would certainly be good if were to get a broad range of people to see what the industry does.
Let me turn specifically to the challenges faced by the packaging industry. My hon. Friend the Member for Rugby raised the question of getting the balance right and of Government and public dialogue about the role of packaging. He is right that packaging and the packaging industry are not the principal problems in waste management. The statistic that packaging makes up less than 3% of landfill has rightly been mentioned. However, packaging clearly has a role to play if we are to ensure that we have a more effective waste strategy. Our approach is to work with producers and encourage a change in consumer behaviour. That issue was rightly mentioned in a number of contributions. When we consider how consumer patterns have changed in the past few years, we realise that we are a world away from where we were before.
We live in a 24-hour, seven-days-a-week culture in which people expect all kinds of produce that for our parents were never available at certain times of the day, let alone at certain times of the year. We expect them, however, to be available 24 hours a day, seven days a week. Inevitably, the industry has responded to that challenge and has changed the nature of how packaging is produced. I suspect that is why, as my hon. Friend the Member for Amber Valley has pointed out, people suddenly find themselves with things wrapped in things wrapped in things wrapped in things, and wonder why. It is right to say that if we were not to wrap effectively, we would find that food waste would be significantly greater. It is important that while we work with the industry—I will discuss the Waste and Resources Action Programme in a moment—we ensure that consumers are encouraged to change their habits positively.
Let me look briefly at what the industry is already doing because, as my hon. Friend the Member for Rugby has rightly said, that is often something that we do not recognise. It is important that we recognise that lightweighting of packaging in the supply chain has been going on for many decades. In the past eight years, household expenditure rose by 20%, but packaging increased by only 3%. While there has been, perhaps for an individual household, the sense that they have more packaging to recycle at home, the gap between expenditure and actual packaging strongly suggests that the industry is being responsive and responsible in this area.
Several hon. Members have raised good examples of that. Asda saved itself approximately £10 million in 18 months simply by changing basic packaging processes. The Home Retail Group looked at the dreadful waste one has when one gets a new sofa or new piece of equipment—not that we have been able to manage one of those in the Prisk household in recent years—and introduced reusable sofa bags. That particular retail outlet has cut packaging by 1,800 tonnes every year just by that simple change, which is an important example. My hon. Friend the Member for Penrith and The Border (Rory Stewart) raised the point that this industry has models of good practice, particularly regarding local impact in more remote areas, and he is right about that.
The hon. Member for Wrexham is right to say that there needs to be a good, open dialogue in the relationship between an industry sector and the Government. I have sought to develop and continue that in the Department. This is where I suspect the opportunity for the packaging industry, perhaps through such forums as the Green Economy Council, could help us crack the problem to which he has alluded. We have developed a road map, which allows us to look at the issue in the round. As we heard in the debate, the problem in packaging is that it is not quite as simple as just a sector. The nature of what it does inevitably means that it strays into areas relating to waste, water and energy. If we could encourage different parts of our industry to get into that dialogue, that would be good and it is certainly something that I want to encourage.
On energy costs, we recognise that our impact, when we look to set the right energy and climate change polices, needs to reflect both generators of electricity and their users. That is a natural tension in any form of energy or climate change policy. It is also important to stress that we, as a Government and not just as a Department, want to ensure that industry, and especially industry with a high or intensive use of energy, remains competitive. There is an issue about how different forms of energy have risen in price. Information from last year shows that, in the past five years, average industrial electricity prices have gone up by approximately 35% in real terms. In that same period, average gas prices have increased by 10%. It is therefore clear that there is a specific issue around electricity pricing, which might pose a risk to the competitive future of those sectors.
The hon. Member for Wrexham rightly pointed to a joint report by the TUC and the Energy Intensive Users Group. That is a powerful document that highlights the estimated cumulative impact of the future energy price in the coming years. That is why not only the Secretary of State in my Department, but our colleagues in the Department of Energy and Climate Change and in the Department for Environment, Food and Rural Affairs, are working together with the encouragement and involvement of Downing street to ensure that we specifically look at and address those concerns around industry.
Later this year, we will announce a package of measures, particularly for energy intensive businesses, where there may be a danger that their international competitiveness is affected. I appreciate that, per se, the packaging industry would not necessarily be classified as energy intensive. Self-evidently, however, some of the key materials it uses—metals and chemicals—are included. That is one way that we can help. I have always made it clear to industry as a whole that I want to know where the pinch points are—the carbon floor price is a good example—so that we do not end up with the danger that has been highlighted. We do not want unintentionally to export jobs and industrial capability, which in the end does not help the climate at all. Several hon. Members have raised that important point.
Mark Pawsey
Does the Minister have any particular advice for the packaging industry to ensure that it is considered as energy intensive and subject to the benefits that he has just outlined?
Mr Prisk
Yes; I want to encourage industry to ensure that specific aspects of the carbon floor price or other elements of our commitment to reduce carbon are incorporated, so that both my Department and other Departments are crystal clear as to where those issues are and that those issues are fed into the current dialogue. I know that there is a dialogue in hand at the moment, but it is important that the industry keep that pressure going.
Mr Russell Brown (Dumfries and Galloway) (Lab)
I hope that the Minister will take from the debate the point that for most of the industry energy costs are significantly greater than the average profit margin, which is a massive issue that needs to be tackled.
Mr Prisk
I am mindful of that, and the hon. Gentleman has made a good point about overheads. Clearly, energy is a crucial issue. That is why, while we want to ensure that we set the right regulatory environment so that generators in renewables come forward, we do not unintentionally to create an unreasonable detrimental impact on the users of energy. That is a difficult balancing act to perform, but that is why we have made it clear that, while we want to pursue the regulatory framework, we want to look at those industries that find themselves under particular pressure with regard to their use of energy. Clearly, electricity rather than gas is the centre of that process.
Other regulatory issues have been raised with regard to waste policy. The waste strategy is focused on waste reduction, driving recycling and the reduction of packaging. We take the view that that can best be achieved in partnership with the sector. That comes back to the important issue, which a number of hon. Members have raised, about the balance between carrot and stick. We genuinely believe that voluntary agreements are one of the best ways forward. In a sense, that is the way in which WRAP operates. It started in 2000 and was designed to advise and help businesses change and innovate—for example, the Courtauld commitment focuses on how waste management can be improved. There have been some important changes. WRAP has been able to secure backing for infrastructure projects with savings of approximately 120 million tonnes of waste from landfill. It also backs programmes such as Rethink Waste, which looks specifically at working with manufacturers to reduce waste and improve resource efficiency. A number of hon. Members have mentioned food and drink. I point to the Federation House commitment, which is important.
In conclusion, this has been a positive debate. We recognise and value the industry, and the change that it is making is important. It is crucial to support and encourage consumer behaviour that enables innovation. We want to work with the industry in a positive dialogue in the weeks and months to come.
Debt Management Plans
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Nic Dakin (Scunthorpe) (Lab)
It is a pleasure to serve under your chairmanship, Ms Osborne, to have secured this debate, and to see so many hon. Members in the Chamber. Many other hon. Members have contacted me to say that they would have liked to be present, but unfortunately cannot attend. I thank the Under-Secretary of State for Business, Innovation and Skills, the hon. Member for Kingston and Surbiton (Mr Davey), for meeting a delegation from the all-party group on debt and personal finance a few weeks ago. He had a positive discussion with us about debt management plans.
Unfortunately, increasing numbers of people are getting into debt. In the Scunthorpe county constituency, for example, the average debt of clients of the Consumer Credit Counselling Service is £16,870. I fear that the trend might continue in the years ahead. When people summon up the courage to ask for help in dealing with their debts, they need to get the best support to clear their debts, not to make matters worse. However, at present, people who try to take responsibility for their debts can find themselves at the mercy of unhelpful, aggressive and sometimes unscrupulous practices that can make dealing with debt an even more unbearable experience.
Gordon Banks (Ochil and South Perthshire) (Lab)
A debt management plan has a real purpose: to return something to the creditors, but also to get the consumer out of debt as soon as possible. Does my hon. Friend have similar concerns to mine, about the many instances in which consumers find themselves with more debt, rather than less?
Nic Dakin
My hon. Friend makes his point well. Under a debt management plan, a debt management company collects a single monthly payment from its clients and administers the repayments on their behalf to each of the non-priority creditors, such as for consumer credit debt. Usually, the client pays for the service, although some organisations will do it for free, such as the charity Consumer Credit Counselling Service and the company Payplan, which are funded through the “fair share” approach to debt management, the virtues of which my hon. Friend extols. Such an approach ensures that the creditor, rather than the debtor, pays for debt advice and support by returning a percentage of the payment made by the debtor to the debt management plan operator. The creditor, however, credits the debtor with the amount of the full payment. That is the best possible approach to debt management, because it aligns the debtor and the debt management company, which is in their interests and the interests of the creditor. That model enables charities such as CCCS to help the nine out of 10 people lacking the means to repay their debt.
Other debt management companies also behave responsibly, but some companies’ practice has significant risks for the client. Most DMCs charge an initial up-front fee, which can be quite high, as well as an administration fee each month, leaving the clients with less money to pay off their debts. CCCS estimates that clients of commercial DMCs will take up to two years longer to repay their debts.
Jonathan Edwards (Carmarthen East and Dinefwr) (PC)
I thank the hon. Gentleman for securing this important debate. Before my elevation to this place, I used to work for the citizens advice bureau movement, and I saw how debt problems had risen significantly in our community. The hon. Member for Makerfield (Yvonne Fovargue), who is present, surely shares that viewpoint. Is it not the case that those debt management companies often target the most vulnerable in society, and that their plans are doomed to fail, which is why we need regulation of the sector, and especially of debt sharks?
Nic Dakin
Although there is some good practice, which we need to recognise and celebrate, a number of DMC practices identified by the CAB cause me great concern: cold-calling and aggressive marketing; charging up-front fees for services that fail to materialise; or poor advice in some cases, particularly when other debt remedies would be more suitable for a client’s circumstances.
Justin Tomlinson (North Swindon) (Con)
It is a pleasure to hear the hon. Gentleman’s contribution on a subject on which he has spoken on many previous occasions. On his point about poor advice, the obvious answer is that we need some form of quality mark, so that when people seek help—more often than not, the most vulnerable people, who are least well equipped to ascertain whether they are getting good or bad advice—they have the assurance that they are taking the right steps.
Nic Dakin
That is a good point. We certainly need more in the system than is there. Other examples of bad practice include: failure to pass on payments to a client’s creditors; ignoring priority debts, such as mortgage or rent, fuel, and council tax, which involve the ultimate sanction of loss of home, fuel supply or even liberty; and excessive charges for debt management services. All such practices have occurred.
Tessa Munt (Wells) (LD)
I have been consulted by a debt management company in my constituency. The gentleman who runs that company said that, if I wanted to become a bailiff, he could probably make me one by next Monday morning, because the legislation on, and control over, the bailiff system is sadly adrift from what it should be, and an awful lot of bailiffs do not act as they should. Does the hon. Gentleman agree that the legislation needs to be tightened up, so that it gives some sort of scrutiny of the process?
Nic Dakin
The hon. Lady makes a good point which, in a sense, underlines that made by the hon. Member for North Swindon (Justin Tomlinson) about the need for tighter regulation, or a tighter quality mark, in this area generally. Recent research by the Association of Business Recovery Professionals has confirmed worries about a lack of impartial advice, insufficient information about fees, and agreement of too many debt management plans that were always going to be unworkable.
Jim Shannon (Strangford) (DUP)
The hon. Gentleman has been generous in giving way. Does he feel that, given the benefit changes that are to be made next year, there will be a greater need for debt management? Also, does he feel that the desperation that arises from debt will fuel an already volatile situation? Does he agree that social security officers and housing associations could give expert advice to help?
Nic Dakin
The hon. Gentleman makes a good point. Sadly, we are moving into more austere times, in which more people are likely to get into difficulty. Indeed, the Joseph Rowntree Foundation this morning published figures suggesting just that. The Office of Fair Trading reported widespread non-compliance, misleading advertising by businesses involved in the area, and a lack of competence among front-line advisers working for DMCs. Sadly, the OFT found that self-regulation is not working and continues to be an abject failure.
Yvonne Fovargue (Makerfield) (Lab)
Is my hon. Friend as concerned as I am that even where there is evidence of unfair practice, the OFT has taken more than two years to close companies down? In those two years, the companies still operate, make a profit and charge vulnerable customers. The OFT needs more power to investigate such companies and shut them down early.
Nic Dakin
My hon. Friend has much knowledge and expertise in this area, and she makes a powerful point about the need for the Government to act now to protect vulnerable people. I know that the Minister has concerns, and I look forward to his response.
Citizens Advice believes that there should be a statutory scheme, with better powers for the regulator, coupled with improved funding of free debt advice. The solution, to improve current arrangements and protect vulnerable people from getting further into debt as a result of the behaviour of those to whom they turn for support and advice, might be to have a regulated environment in which providers are independently audited to standards set by an independent body, fees are controlled, and there is clear certainty about the repayment term, for creditors and debtors alike.
Gordon Banks
My hon. Friend is generous in giving way. He has hit the nail right on the head. This is a little bit of advertising: I hope later this year to promote a private Member’s Bill on this very issue, providing for a statutory scheme that is binding and includes a rigorous audit process and a fee cap. Does he agree—this has already been touched on today—that when someone approaches a debt management company for advice, they are at their most vulnerable? If they are told, “Give me £50”, or £200 or £600, “and I will sort the matter out, and spread that payment over a period,” that is exploiting their vulnerability.
Nic Dakin
My hon. Friend makes a powerful point. We look forward to his private Member’s Bill, which will raise the issue again. We need a regime that will encourage providers to compete on quality, rather than the size of their advertising budget. Debt management plans would then be more likely to lead to debt repayment and genuine resolution of debt problems for the majority of customers who entered into them. That would be achieved at far lower cost than under the current regime, and would significantly increase the speed with which creditors were repaid. That would be good for debtors, good for creditors, and good for UK plc.
Damian Hinds (East Hampshire) (Con)
I congratulate the hon. Member for Scunthorpe (Nic Dakin) on securing this important and timely debate. I thank him and the Minister for allowing time for several hon. Members to make short contributions. The issue is not party political, and it is encouraging that hon. Members from six political parties are here. We had an opportunity to debate related issues in the House yesterday, and almost everyone now coalesces around the fact that a proper approach to the issue must have three strands: education, regulation and provision of alternatives. The important issue that we are discussing, which relates to a growing problem, touches on all three strands, but has to do with regulation especially.
I am a Conservative Member of Parliament, and not a great fan of new regulation, but this is one area where it is needed. It is astounding that when some markets are grappling with sometimes unreasonable regulation, regulation of debt management has not hitherto been more effective. I daresay some hon. Members may take a purely libertarian, “caveat emptor” view of the matter, but I have not yet met them. If I have, I have not heard them expressing that view. As has been said, the market that we are considering deals with some of the most vulnerable consumers. “Vulnerable” is a word that is used an awful lot these days for all sorts of things, but it applies in the purest sense in this case. Much as it may challenge our view of economic theory and so on, the fact is that many people are not making rational choices, and the debt solutions that they seek are often about the first advert that they see, rather than what is most appropriate for them.
Gordon Banks
The hon. Gentleman’s point is appropriate; people get sucked in by the first or last advert that they see. However, there is another side. As I have said, one objective must be to give money back to creditors, and the more that is paid in management fees, the less goes back to creditors. We certainly want to help consumers, but we must also recognise that creditors are entitled to repayment of debts.
Damian Hinds
The hon. Gentleman makes a fine point. The “fair share” model works for various not-for-profit organisations and can be effective. We should foster and encourage that. A lot could be done with regulation in this area. I want to focus on a couple of measures that the hon. Member for Scunthorpe mentioned, which are relatively straightforward and would be effective.
The first is the banning of cold-calling canvassing for new business, and the second is the banning of up-front fees. The two together would make a big difference. On up-front fees, many people suspect that some operators in the market have a cash-flow model that recognises that they may not be around for ever. Those are not the sort of debt management companies that we want. There are responsible operators, and those are the ones that should be encouraged.
I want to make a final, brief point about the visibility of various debt management services. The Consumer Credit Counselling Service, citizens advice bureaux and others offer free advice services, and the internet is an important source of information for people these days. When people get round to looking into ways of solving their problems, they should be able to find those services easily. I hope that search engine providers, particularly Google, which to all intents and purposes is the search engine provider, will be encouraged to act.
Mrs Jenny Chapman (Darlington) (Lab)
I congratulate my hon. Friend the Member for Scunthorpe (Nic Dakin) on securing this debate. Will the hon. Member for East Hampshire (Damian Hinds) add to his list a ban on the sale or passing on of information about people to debt management companies? We have been concerned about that practice in the motor industry, with regard to insurance claims. Does he share my concern that the same practice takes place in debt management?
Damian Hinds
I do indeed. By definition, a ban on cold-calling would include the selling of lists and the sharing of data.
I conclude on the point about search engine marketing, and encourage search engine providers, as part of their corporate social responsibility agenda, to take a different view, so that rather than considering only the pay-per-click bid times the click-through rate, they consider what they can do to help people in some of the most difficult circumstances. I again congratulate the hon. Member for Scunthorpe on securing the debate.
Yvonne Fovargue (Makerfield) (Lab)
I congratulate my hon. Friend the Member for Scunthorpe (Nic Dakin) on securing this debate, which we have needed for some time. I confirm that I believe that creditors must be paid, but the practices of some debt management companies do not encourage that. They load the fees up front, and recoup all their charges in the first two years. They provide no encouragement for people to carry on with a sensible plan, because the up-front loading discourages people from continuing after that period, and frankly they do not worry about that, because those two years are where they make their money. They cannot offer the full range of solutions, and are not allowed to do so, because only authorised providers can produce debt relief orders, and in the main those providers are citizens advice bureaux.
There was great concern last year when the financial inclusion fund was due to finish. Fee-paying debt-management companies were circling like sharks, thinking, “We’ll be the only option, and debt advice will not be available.” I urge the Government to consider a financial inclusion fund and free debt advice, because that is all that will stop some debt management companies.
I am worried about the link between such companies and high-cost lenders, some of which now have another arm: a debt management company. They get people into debt, charge them for that, and then put them through to their own debt management company, which will charge to get people out of the debt that it put them into in the first place. That is not acceptable. Regulation was introduced in the United States and Australia, which are not countries noted for over-regulation, and it has worked. That is why there is a proliferation of debt management companies here.
Gordon Banks
I suggest that my hon. Friend ask the Minister to look over the border at Scotland, where there is a system that works much better than that in the rest of the UK.
Yvonne Fovargue
I agree that regulation has worked, which is why American companies have come over here. It is too hot for them to operate over there, so they are now operating in England, and our consumers are suffering. Along with regulation, we must give the organisation that has the regulatory power the means quickly to close down companies, or suspend them from trading, when there is consumer detriment and bad practice. Two years is not acceptable.
I thank the Minister for listening last time we were here, and ask him to consider free debt advice. I appreciate that debt management companies have a role to play, but they must be regulated if they are to play the kind of role in society that we all want them to—a responsible role.
The Parliamentary Under-Secretary of State for Business, Innovation and Skills (Mr Edward Davey)
I congratulate the hon. Member for Scunthorpe (Nic Dakin) on securing this debate. I was pleased that he did, and it is good that so many hon. Members have contributed to it and aired their concerns. The Government are acutely aware of those concerns, and we share many of them. It is a sign of our desire to protect vulnerable individuals that debt management issues were a major part of the questions that we asked as part of the joint Treasury and Department for Business, Innovation and Skills call for evidence. The “Consumer Credit and Personal Insolvency Review” was published last year, and covers all aspects of the consumer credit life cycle, including what happens when things go wrong.
Hon. Members will appreciate that it is difficult to obtain a precise picture of the debt management industry, even to the extent of obtaining accurate figures for the number of plans in place. Some of the concerns that we have heard recognise that lack of information. I cannot give details today, but I am keen to improve the quality of information about the industry. I will say more about that when we publish our response to the call for evidence, which will be soon.
Despite the constraints, improvements have recently been made to protect the most vulnerable debtors. By extending the eligibility criteria for debt relief orders, we have enabled more of the most vulnerable people to find a way out of unsustainable debt. Some safeguards are already in place, although I understand that several of my colleagues would like us to go further, and I will go on to talk about that. Providers of debt management plans are required to hold a consumer credit licence, and holders of those licences are monitored by the Office of Fair Trading. The OFT has strong enforcement powers. Following its compliance review last year, it issued warnings against 129 companies, of which 43 have since left the market and investigatory work is ongoing in many other cases. The OFT is determined to see that work through as soon as possible.
The OFT has recognised the need to improve its guidance, and it recently published proposed revised guidance for debt management plans. That guidance sets out the standards that the OFT will expect of debt management businesses, and makes it clear that, among other things, such businesses must be fully transparent about the service on offer and the fees charged; explain to consumers the risks and benefits of each proposed solution; not use misleading names or advertising, including misleading web-based adverts; and ensure that the advice provided is in the best interests of customers. Any business that fails to adhere to that guidance can expect strong action to be taken against it, including, where appropriate, the removal of its licence. The industry has recognised the need to improve its practices, and it is welcome that a number of debt management organisations have joined the Debt Managers Standards Association, which, as the OFT has recognised, is trying to improve standards.
What more needs to be done? The Government believe strongly that those struggling with debt must be assured that they will receive the best advice and be directed to the solution most suitable for their needs.
Mr Davey
I am concerned about the time; perhaps I can make a little more progress and then give way to the hon. Gentleman.
Free and impartial advice is available for people in difficulty. We need to make sure that such advice is well publicised and that vulnerable people know where to find it and can avoid unscrupulous businesses that may seek to take advantage of them. We know about Citizens Advice, and I was pleased that the hon. Member for Scunthorpe mentioned the Consumer Credit Counselling Service, which is a fantastic organisation. He also, quite rightly, mentioned Payplan. We must ensure that people are aware that they can get quality advice for free. That is essential.
Hon. Members have expressed concern that the aim of some fee-charging debt management companies is to make money for themselves, rather than to ensure that an individual finds the appropriate solution for their circumstances. We have also heard, both today and on previous occasions, that some individuals who enter a debt management plan find that they emerge from that plan in a worse position. Clearly, that cannot be right.
I am concerned that those who are in a vulnerable position might seize on an advert that offers what appears to be an easy way out of their difficulties. If they are told that the organisation that they approach will deal with all their debt problems, they may not ask about the likely costs and that will create difficulties. The answer to that complex problem does not necessarily lie in more regulation. We need to empower debtors to find the right information, access the right sources of impartial advice, and find the solution that best meets their needs. We confirmed some time ago that we will fund the face-to-face debt advice project for a further year, while work is done to move the provision of such advice to a more sustainable footing. As my hon. Friend the Financial Secretary to the Treasury said yesterday in the House,
“it is the intention that the Money Advice Service—which is funded by the financial services industry—will take on that work.”—[Official Report, 4 July 2011; Vol. 530, c. 1254.]
It is important that free debt advice is available through Citizens Advice, the Consumer Credit Counselling Service and other quality, free debt advice services.
I want to look at what more can be done to ensure public awareness of reputable debt advice sources, whether online, over the telephone or face to face. Everyone involved in the debate—creditors, debt advice agencies and providers—should be involved in finding the best way forward. When we publish our response to the call for evidence, we will make proposals designed to foster that collaborative approach and help people with unsustainable debts to get the help and advice they need to take control of their lives once more.
Gordon Banks
The Minister talks about ensuring that creditors get the best advice. Many of the major lenders fund debt management processes through Payplan, for example. Is there any mileage in making the main funders of an organisation such as Payplan, which could be the major creditor of someone entering a debt management plan, have a role in guiding someone from a fee-paying to a non-fee-paying organisation?
Mr Davey
The hon. Gentleman makes an interesting point. It is surprising that many public bodies—whether local authorities, utilities or lenders—do not make those who cannot pay their bills or are in debt as aware as possible of quality, free advice services. We need to talk to those organisations because raising awareness is critical.
Mr Davey
I will give way in a moment to the hon. Lady; she made a very valuable contribution.
When people are in debt, that can affect their health and there could even be mental health consequences. We must ensure that people do not end up in the clutches of a company whose advert they heard and do not recognise that there are free, quality advice services. We must deal with that issue.
Yvonne Fovargue
Does the Minister accept that we must not only make people aware of the free agencies available, but ensure that those agencies have quick, available appointments? When somebody wants to get out of debt, they do not want to wait six weeks for an appointment. That is where the debt management plans win; they say, “We’ll deal with you immediately.”
Mr Davey
The hon. Lady makes a vital point. We must ensure that people are aware of all the different options. Online options are increasingly being taken up; they are effective and can be accessed 24/7. There is a high usage of online helplines, and if people are vulnerable or ill, they should have access to quick and quality face-to-face advice. I agree with the hon. Lady.
We have heard a number of ideas during the debate, and we will reflect on them, just as we have reflected during the call for evidence. We have heard interesting ideas such as that from my hon. Friend the Member for East Hampshire (Damian Hinds) about whether search engine providers ought to think about their social responsibilities when people search for advice. There are issues about audits and so on.
Mark Durkan (Foyle) (SDLP)
May I take the Minister back to when he referred to the more robust guidelines that the OFT will produce? He said that the OFT will move against firms that breach those guidelines, possibly by withdrawing their licences where appropriate. Who will determine when such action is appropriate? What will be the exact criteria? If those decisions are open to challenge, will the OFT end up having a paper power that it never exercises? The firm from which the OFT might wish to withdraw a licence will always have deep pockets, and the OFT might feel that a challenge is not worth its while.
Mr Davey
The OFT is the regulator. If it deems an organisation to have breached the guidance, it can act. Indeed, it has acted. Some 43 out of the 129 companies that it identified and investigated have left the market. The idea that it is a regulator that does not take action or track companies down if they do not behave properly is not correct. That does not mean, however, that we cannot improve the overall framework.
When I met the hon. Member for Scunthorpe and a number of his colleagues from the all-party group on debt and personal finance—which, I should say, is doing fantastic work—we had a number of discussions, some of which were reflected in the debate. We share a lot of the concerns that have been raised today. I cannot prejudge the response to the call for evidence, which will arrive soon, but I share the views of colleagues and we will take action.
Neuroblastoma
(12 years, 10 months ago)
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Neil Parish (Tiverton and Honiton) (Con)
It is a great pleasure to speak under your chairmanship, Ms Osborne. I thank Mr Speaker for granting me this debate on primary care trust funding for neuroblastoma. I am delighted to welcome the Minister with responsibility for care services and look forward to hearing his response to these grave matters.
Neuroblastoma is a rare solid tumour cancer that tragically occurs in very young children and infants, primarily under the age of five years. It accounts for 17% of cancer deaths in children. Only 100 children are diagnosed with neuroblastoma each year in the UK. That is a blessing in itself, but it is of little comfort to the parents coping with the emotional strain of knowing that their child must face the long, hard battle against cancer.
The disease is caused by the development of cancerous cells in neural crest nerve cells, which play a key role in the development of the sympathetic nervous system. Most neuroblastomas begin in the abdomen or adrenal gland, next to the spinal cord or in the chest. In nearly 70% of children diagnosed, the disease has metastasised, which means that it has spread to other parts of the body. That makes it a particularly hard cancer to treat. The disease commonly spreads to the bones, and it can cause pain and difficulty in walking. Occasionally, it can affect the spinal cord, causing numbness, weakness and loss of movement in the lower part of the body.
The symptoms depend on where the cancer starts and whether it has spread to other parts of the body. Initial symptoms can seem as innocent as tiredness, fever and loss of appetite. The vagueness of those symptoms makes neuroblastoma hard to diagnose in the early stages. Because neuroblastoma usually develops in the abdomen, the most common symptom is a lump in the stomach, which can make the child’s tummy swell, causing pain and great discomfort.
The disease is treated through a variety of means, including surgery, chemotherapy and stem cell replacement. However, even after those treatments, high-risk neuroblastoma remains a major cause of death due to malignancy—patients have a two-year survival rate of approximately 20%. On top of that, the majority of high-risk neuroblastoma patients will experience disease relapse.
It saddens me, then, that a young constituent of mine, named Sam Daubany-Nunn, is being denied funding by his local primary care trust to receive vital treatment in Germany that might well be curative. Sam was diagnosed with neuroblastoma at the age of 16 in July 2008. Such a diagnosis is quite unusual in someone as old as that. At the time, Sam was undertaking his GCSEs at Colyton grammar school. He went through eight hours of surgery, gruelling high-dose chemotherapy, a stem cell transplant and radiotherapy. Fortunately, he responded well to his treatment and, despite his illness, he excelled at school, achieving high grades in every subject. He went on to pursue his studies at sixth-form level. I met Sam and his family in Seaton in my constituency. They live in Uplyme, right on the border between Dorset and Devon. That is why Dorset PCT is in the dock today.
Sadly, Sam became ill again in October 2010 and the family were informed that he had relapsed and that the neuroblastoma had come back. Sam went through six further courses of chemotherapy, two cycles of metaiodobenzylguanidine treatment at University college London and another stem cell transplant.
Following that, a new treatment was added to the front-line protocol in the UK for all new children diagnosed. That new treatment is a targeted cancer therapy called monoclonal antibody therapy. Monoclonal antibodies are made in a laboratory and introduced to the body intravenously. They attach themselves to areas on the cancer cells. In this case, the antibodies bind to a protein called GD2 on the surface of neuroblastoma cells. Those antibodies operate as markers for the patient’s own immune system, encouraging it to attack and destroy cancerous cells. Without those markers, the immune system would not attack cancerous cells, as those tumours are part of the body.
I was pleased to receive a letter from my right hon. Friend the Secretary of State for Health in response to a point that I raised with my right hon. Friend the Leader of the House at business questions. The letter informed me that UK patients now get access to that treatment via the Cancer Research UK-supported European trial and that there is now wide clinical agreement that all children with high-risk neuroblastoma who might benefit should have access to monoclonal antibody treatment, as it increases survival rates to about 70%. That is extremely important. However, that clinical trial, led by Dr Penelope Brock from Great Ormond Street hospital, is not available in this country for relapsed cases—it is available for newly diagnosed cases only—and five or six patients a year would not meet the strict criteria for the trial.
A second trial is being established with wider eligibility criteria, and it will include those children who, like Sam, have relapsed, but it will not be available until January 2012. That is an unworkable time frame for neuroblastoma sufferers who cannot wait for the UK trials to start. That is certainly the case for Sam. As a result, some parents have opted to take their children for treatment in Germany, which is piloting the new trial that will be available across England in 2012. That has been paid for by their local primary care trust after an individual funding request. However, Dorset primary care trust, near my constituency, has refused to support the funding request in Sam’s case. His family have been raising funds to pay the €80,000—a very big sum—that the treatment in Germany costs. Indeed, they have remortgaged their house. Hon. Members will understand that not everyone can take that action, which is why I am raising this matter with the Minister today in the House.
Sam’s case is not isolated. After raising neuroblastoma funding in both the House and the media, I was contacted by a father whose son, Adam, suffers from neuroblastoma. Like my constituent, he is not eligible for the clinical trials in the UK and he made an individual funding request to Surrey primary care trust, which, like my constituent’s, was rejected. I understand that Adam’s father is now in contact with his local MP. I wish him and his family well and hope that he can receive the treatment that he needs.
That contrasts with the decision made by NHS Northamptonshire’s individual funding request department in an almost identical case involving a constituent of my hon. Friend the Member for Wellingborough (Mr Bone). I will take this opportunity to thank my hon. Friend for all the assistance that he has given me in this regard. A young boy named Zach, whose case my hon. Friend has previously debated in Westminster Hall and who, like Sam, was not eligible for the clinical trial, was offered funding for monoclonal antibody treatment in Germany. In its letter to the family, the individual funding request department made this clear:
“Given the timescales involved NHS Northamptonshire does not wish further obstacles to stand in the way of treatment and we have agreed that if necessary the cost of monoclonal antibody treatment in Germany would be covered by NHS Northamptonshire.”
Fortunately for my constituent, there has been a last-minute change of heart by Dorset primary care trust. I received a call last night from the chief executive of Dorset PCT, who informed me that it had reviewed Sam’s situation and concluded that his was a unique case and that it would be unfair not to support the request for funding. That is fantastic news, and I extend my thanks to Paul Sly, the chief executive of Dorset PCT, for his assistance and for reviewing the original decision. However, I cannot help but feel that this case may not have had such a happy ending had I not been contacted by Sam’s family, written to the chief executive of Dorset PCT, raised the matter in the House, written on the subject in the press and finally secured this debate today.
I emphasise that other families might not be able to raise the funds to go to Germany. It is essential that Samuel gets this treatment now; otherwise, his chances of survival will be hugely limited. That is why it is good to raise this matter. That raises the question of how two primary care trusts can come to two completely different conclusions and why some people should be denied potentially life-saving treatment in such an ad hoc manner. People should be treated fairly throughout the country, and although I realise that the PCTs probably have a great deal of autonomy, I urge the Minister to iron out the problems, if he can. We can then get to January and February next year, when monoclonal antibody treatment will be available in this country.
Finally, I want to read from the conclusion of the letter from Paul Sly, the chief executive of NHS Dorset and of NHS Bournemouth and Poole:
“Our local processes for individual treatment requests are set up to try to deal fairly with the vast majority of requests. However as we went through the request it became apparent that the only possible funding route for Samuel at this time was a referral to the National Cancer Drugs Fund. Unfortunately as the Fund only covers ‘drug costs’ they were unable to assist.
In the light of the above, we carried out a further review of Samuel’s situation and concluded it is unique for three reasons…the treatment will be available in the UK later this year…he meets the trial inclusion criteria…he has to have the treatment within a specified time frame and cannot wait for the UK trial to start”.
That is extremely important.
I have put the issue on record. I hope that the problems faced by Samuel Daubany-Nunn and his family will reach a good conclusion. I reiterate to the Minister that there are not many such cases in the country, but it is extremely important that people receive this treatment when they need it, otherwise their chances of survival are very limited. I therefore ask the Minister to look at the general process. I am certain that NHS Dorset will honour the position that it has taken in its letter, but I am naturally keen to ensure that the Daubany-Nunns get help with funding Samuel’s treatment, because they very much need it, and it is only fair that people are treated similarly throughout the country.
The Minister of State, Department of Health (Paul Burstow)
It is a pleasure to take part in the debate. I congratulate the hon. Member for Tiverton and Honiton (Neil Parish) on securing it. A quintessential feature of Adjournment debates is that they give Back-Benchers the opportunity to bring to the attention of the House and a wider audience issues that are of real importance to the lives of our constituents—literally, in this case. I therefore thank the hon. Gentleman for bringing this issue before us.
Few things are more distressing for a parent than learning that their child has cancer. Everyone’s heart would go out to any family that found itself in the same circumstances as Sam’s family, and I shall say more about their case in a moment. First, however, I want to say a little about the Government’s overall approach to paediatric cancer. I then want to say something about neuroblastoma and the Government’s approach to it. Finally, I want to say something about this case.
On paediatric cancer services, the Government are committed to improving outcomes for all cancer patients, especially children and young people who have to deal with this disease at such a young age. That means ensuring that patients have timely access to high-quality treatments based on the best available clinical evidence. That is very much the Government’s ambition and goal. We want to deliver care that is safe and effective and that provides the best possible experience for young patients. Let me highlight a number of things to demonstrate that commitment.
First, we will ensure that the recommendations in the guidance from the National Institute for Health and Clinical Excellence on improving outcomes for children and young people with cancer continue to feature in all commissioned services.
Secondly, one of the recommendations includes ensuring that children and young people with cancer are offered entry to any clinical research trial for which they are eligible and that adequate resources should be provided to support such trials. We expect providers and commissioners of services to be mindful of that recommendation, and that goes to the heart of the hon. Gentleman’s concerns about the lessons that need to be learned from this case.
Thirdly, NICE guidance recommends that children who are not eligible for clinical trials should be treated according to agreed treatment and care protocols based on expert advice and that resources should be provided to monitor and evaluate progress and outcomes for the patient.
Fourthly, we have committed more £150 million over the next four years to the expansion of radiotherapy capacity and to ensuring access to proton beam therapy for all high-priority patients who need such treatment. Evidence shows that, compared with standard radiotherapy, PBT leads to improved outcomes and reduced acute and late effects, such as growth deformity, loss of hearing and lowered IQ, which can lead to learning difficulties. We are exploring options for developing PBT facilities in England to treat up to 1,700 patients a year.
Through the national cancer survivorship initiative, we are improving the quality of services supporting the long-term needs of children and young people. That needs to provide for a seamless transition from children’s to adult services and a constant focus on outcomes.
We are demonstrating the affordability and efficiency savings that one-to-one support for cancer patients can bring. Based on the emerging evidence from test sites and the core principles defined by the children and young people group, four models were identified and are being piloted in four sites to help to bring innovation to the delivery of support for children with cancer. Those models include a primary treatment centre aftercare model; a shared care model of aftercare, in which care is shared between the primary treatment centre and GP and primary care services; and a nurse-led model of care, which may include variations such as a telephone or text message model of aftercare.
The Royal Marsden hospital, in my constituency, has tested the benefits for the patient experience of introducing a clinical nurse specialist to their late-effects set-up. That has been combined with developing psychological screening tools to improve access to appropriate psychological therapy services. A number of things are therefore being done, as we strive generally to improve paediatric cancer services.
Let me turn now specifically to neuroblastoma. As the hon. Gentleman said, neuroblastoma is a cancer of specialised nerve cells involved in the development of the nervous system and other tissues. It can occur anywhere in the body, but it most often occurs in adrenal glands, particularly in the tummy, as he said.
About 100 children, usually under the age of five, are diagnosed with neuroblastoma each year. Of them, about 50 are in the high-risk group, with the most serious forms of the disease. We want to give every one of those children the best chance to beat the disease by ensuring that they have access to specialist oncology centres and good access to clinical research trials.
The UK has a good and long track record of achievement in basic cancer research, and the Department of Health invests more in cancer research than in any other area of human health. We now have the highest national per capita rate of cancer trial participation in the world. That is relevant to the debate, because there is now wide clinical agreement nationally that all children with high-risk neuroblastoma who might benefit should have access to a trial of monoclonal antibody treatment.
For the benefit of the hon. Gentleman and others who are following the debate, I should explain that the monoclonal antibody is not available as a normal drug supplied by a pharmaceutical company. To obtain it, a production run must be commissioned and produce enough doses to treat a large number of children. Most UK patients will now access this treatment through the Cancer Research UK-supported European phase III trial. The trial is led in the UK by Dr Penelope Brock from the Great Ormond Street hospital, as part of the UK Children’s Cancer and Leukaemia Group.
On 12 May, my ministerial colleague Lord Howe was privileged to visit Great Ormond Street to see at first hand the impact of Dr Brock’s work on families affected by neuroblastoma, as well as the real hope it offers to those most seriously affected. The national cancer research network of the National Institute for Health Research provided the NHS support for the trial, which is running in all 20 childhood cancer clinical trial centres across the UK. It is anticipated that the trial will recruit 160 children between 2009 and 2013, and it is estimated that about 40 children a year in the UK will be eligible for the treatment.
The hon. Gentleman was right to raise concerns about children, particularly those with high-risk neuroblastoma, who have unfortunately been considered ineligible for the first trial. Dr Brock is now setting up a second trial, which should benefit those five or six patients a year who do not meet the strict eligibility criteria for the first study. The Department has agreed to fund a second batch of antibody for that purpose. I understand that Dr Brock is planning to run the second trial in five centres in England, from this autumn—not next year.
The proposal is with the clinical trials academic review board for Cancer Research UK, and once it is approved it will go to the Medicines and Healthcare products Regulatory Agency for approval. While the trial proposal is progressing, Dr Brock’s colleague in the European monoclonal therapy trial, Professor Holger Lode, has been piloting the new trial at the SIOPEN centre in Germany, which the hon. Gentleman mentioned. It is perhaps inevitable that one or two patients will be identified as needing the treatment while the trial proposal is going through the necessary approval stages. The hon. Gentleman highlighted in that regard his own constituency case and that of the hon. Member for Wellingborough (Mr Bone).
I am aware that some PCTs have paid for patients who meet the eligibility criteria to go Germany for the treatment. Non-routine treatment abroad will usually be considered in exceptional circumstances and primary care trusts may at their discretion take into account the individual circumstances of the patient and authorise treatment abroad that they do not normally fund. Each case needs to be considered on its merits as issues such as progression, relapse and the use of second-line treatments can all affect an individual’s suitability for treatment, including clinical trials. Each case needs to be discussed carefully with experts in the field.
The hon. Gentleman talked about his case experience and Sam’s diagnosis and mentioned the good news that the PCT has further considered the matter and, I understand, has taken into account Dr Brock’s views about the way the trial will work. I think that that has materially affected the judgment that the panel made originally and allowed it to make a new decision to allow for the funding of the monoclonal antibody treatment in this case.
I hope that the treatment, which, I understand, may already have started, will be a success and that that will be further good news for the family and offer them hope for the future. I hope that the hon. Gentleman will pass on my best wishes and those of my ministerial colleagues for Sam’s future and the success of the treatment and that we shall draw lessons from the case to ensure that, when other PCTs consider cases with exceptional circumstances, they are properly aware of the criteria that they should use.
Great Lakes (Africa)
(12 years, 10 months ago)
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Eric Joyce (Falkirk) (Lab)
I want to say a few words, in opening, about the nature of the debate. It is a little unorthodox, in the sense that normally there would not be several hon. Members speaking in such a short debate; however, there was great interest in the subject. The all-party group on the great lakes region of Africa went to the Congo recently. I was not on that trip. There is a great deal going on there, of course, and I am sure that the Minister will say more.
Although most hon. Members who are present are aware of the broad context and much of the detail, it is worth setting out some of the things that are happening. Some things that are happening in the Democratic Republic of the Congo are very important, one of which is that very soon, we hope, there will be an election. That is planned for November, which is a little later than it might have taken place. Nevertheless, it is a good sign. The UK was very involved the last time round, and sent several official observers. Members of this place and the other House went with non-governmental organisations to observe the elections. It was a very successful election process for the region, all things considered. There was a good, high turnout at the last presidential and prime ministerial elections in the DRC, and an independent commission ran things. International observers from all sorts of NGOs, UK bodies and Governments thought it went pretty well. There was a pretty good tick in most of the boxes.
Some years later, there is a rather different backdrop to the elections. The cost of the elections last time was about $225 million. One assumes that the cost is similar this time, but the international community was more reluctant, understandably, to find the large amount of money needed to run such a large-scale election in a place as difficult as the DRC, which is the size of western Europe but covered in tropical rain forest, making the logistics very complex. The election was well run last time, but this time there are one or two question marks. That is not to say that the election will not be legitimate. However, political development in the country over the past five years has been modest.
I have met Mr Tshisekedi, the person who would probably be considered the leader of the opposition, in so far as one can be considered to exist. He is an important figure in Congolese politics, and he is capable of putting together an alternative platform in the presidential re-election campaign. At root, however, it seems to be a fairly basic offer. One assumes that unless the elections are run tidily and independently, there will be questions about the process.
The elections have been put back a bit, and the constitution has been changed to take out the second round in the presidential elections. That is significant, as some think that President Kabila may not win a second round. Nevertheless, he will certainly get the majority of votes in the first round; so many people stand as presidential candidates that it is hard to prevent that, but who knows? What gave the last election considerable legitimacy was the fact that it was a tightly run process; the result was 57% to 43% in the second round, which was a clear result for everyone. It was clear that there was a genuine opposition, albeit the chap who was the opposition is now banged up in The Hague. That is a pity, but there it is.
This time round, the electoral commission is being run by an ally of the President, which is cause for concern. This is primarily a Foreign and Commonwealth Office issue, but although the Minister may have a view, my instinct is that he will want to wait and see how it goes. It is fair to say that we should let the processes take place and express our judgment after the elections. The elections are important, because they change other things that are happening at the same time.
Jim Shannon (Strangford) (DUP)
Does the hon. Gentleman agree that the formation of an integrated and professional army that does not abuse the people, but gives them the chance to express themselves, is important? It is essential that people can use the ballot box unhindered.
Eric Joyce
I thank the hon. Gentleman for making that profound point. We cannot do anything in countries such as the DRC unless we have security. We cannot have justice, effective infrastructure, hospitals and schools if people are too frightened to leave their houses or move around the place safely. In parts of the east—not only there, but significantly in the east—that is very much a fact of life for many. They live in dour conditions, and security is of the first order.
The FARDC, the army, has a history of having some competently trained people—trained in conjunction with the UK and the French. I do not want to say anything pejorative, but it does not have a high capacity, if I could put it like that. It has one or two people who are perfectly competent, and a large number of people who are not. First and foremost, the DRC needs a proper security regime, but in a good way; in effect, the country needs the army function, rather than a policing function. At a different stage of development, we would be talking about police, but it is a case of the army trying to maintain law and order.
There are some programmes, particularly from the United States, and there is a common European effort to assist in building capacity, but it is a long-running process. One of the early things that has to be done is to get the army to behave decently towards its own people. Poor discipline—it often breaks down, particularly in the east, where deployment of the army is coincidental to the mining operations—is a matter that should be scrutinised by us and international authorities, but the hon. Gentleman makes a profound point.
I turn to the question of minerals. The DRC is enormous, and its mineral reserves are unbelievably huge. One thing that prevents their full exploitation is that many companies are still concerned about the environment and corruption, and the damage that that does to their brand. The DRC produces about 18% of the world’s diamonds, but mainly in an artisanal manner; they are not produced industrially, as one might imagine it being done in South Africa, because the big companies are reluctant to play in the DRC. Some companies have invested in proper infrastructure—they have built proper mining operations—but they find things quite unstable at the moment.
I have waxed rhapsodic endlessly in the main Chamber, and in Westminster Hall, about a deal that involved First Quantum Minerals. It is a quite famous case that also involved ENRC, a FTSE 100 company, but I do not want to bang on too much about it and bore all who have heard me talk about it before. The essence of the case is that if there is an unstable trading environment, a company’s reputation could be damaged by one or two decisions that a Government may make in places such as the Congo, which may make it difficult for companies to invest properly.
First Quantum was the largest taxpayer in the Congo, which collects very little corporate tax and almost no income tax per annum. At the time, First Quantum was employing several thousand people at a mine in Kolwezi near the Zambian border. The mine was effectively expropriated by the Government, sold on for a small amount and then sold on again for a large sum. The question is where the bit in the middle went. No one knows, but we can guess. That, of course, makes it hard for other mining organisations, who saw that mine being expropriated, to invest in DRC. Sadly, that mine is an exemplar of what can happen; it sits empty, basically rotting, with no work going on there. There are no jobs. Companies that can provide several thousand jobs are a rarity all over the Congo, but particularly in the east and south, where jobs are a lifeline for the extended family. Those jobs have gone; there are no operations, and of course no tax is being paid.
As other Members wish to speak, I shall conclude by mentioning PROMINES. I am speaking without notes, so I am not sure whether I have mentioned it already, but ProMines is an excellent effort by the British Government, working in conjunction with other Governments, to increase transparency in the mining industry, and to make it legit so that people can invest with confidence. I understand that things were held up briefly at the time of the First Quantum deal, because the World Bank was concerned about that expropriation. The project stalled as a result, but I believe that it is on the go again. It is an essential developmental issue and a super idea. I hope that Minister will speak about it when the debate concludes.
Paul Uppal (Wolverhampton South West) (Con)
I am delighted to serve under your stewardship, Ms Osborne. I congratulate the hon. Member for Falkirk (Eric Joyce) on securing this most important debate.
I shall highlight some of the ongoing problems in the DRC, and particularly the eastern region. Time will not allow me to go into the topic in great detail—I am sure that everyone is aware of the complex and wide-ranging problems that the country faces—so I shall speak instead about women in the DRC, and the frightening and dangerous situation that many women face.
In a recent survey by leading gender experts, the DRC was named as one of the worst places in the world to be a woman. Sexual violence is widespread there, and there are instances of it being used as a weapon of war. I am encouraged that, in recent years, the international community has highlighted the problems of women in the DRC and has campaigned against sexual violence. However, as news reports show, the issue is ongoing, with hundreds of women—and also men, I understand—being sexually assaulted.
To empower women, we need to ensure that stability and peace are brought to the region, a point made by the hon. Gentleman. I was disappointed to learn from news reports yesterday that violence has marred the registration process for the elections. It is important for the international community to ensure that elections are free and fair, and that everyone is able to vote—most importantly, of course, women. If better governance is to be created, it is imperative that the elections be conducted correctly.
I was encouraged to read the Foreign and Commonwealth Office action plan to implement stricter legislation on sexual violence. Progress has been made in recent years with the Congolese law on rape in 2006, coupled with a better understanding and legal qualification of what constitutes rape, and the introduction of UN Security Council resolution 1888. Stability is essential, but we must work to tackle the attitudes and conditions that allow such violence to take place. Training and education for the army is essential, but it must be coupled with a strong legal system that will bring those who commit such crimes to justice.
Tackling corruption is vital. We must also ensure that high-level officials are brought to justice for crimes committed. Government aid to local NGOs, including that provided by the UK, is imperative to ensure that those organisations have the funding to allow them to reach people in towns and villages across the DRC. Such organisations can also encourage women to speak out, empower them to be involved in public life and help to reconcile them to the past. They can also address the issues at a local level. The NGOs will remain after the conflict ends and help to ensure that women’s rights continue to be protected. Those are short-term measures, so let me address more long-term issues.
Sexual violence should not just be seen in the context of the instability in the eastern areas. It did not originate from the conflict; the conflict intensified an existing problem. Discrimination against women is of long standing and will need to be tackled, alongside promoting peace, to ensure that women are in a better situation in the years ahead.
Stephen Twigg (Liverpool, West Derby) (Lab/Co-op)
I congratulate my hon. Friend the Member for Falkirk (Eric Joyce) on securing this important debate and the hon. Member for Wolverhampton South West (Paul Uppal) on his contribution. The hon. Member for Oxford West and Abingdon (Nicola Blackwood), Lord David Chidgey for the Liberal Democrats and I were part of an all-party parliamentary group that had the privilege to visit the DRC in May. The two speeches covered some of the issues that we addressed and I want to say a bit more about each of them.
As the Department for International Development is responding to this debate, may I begin by praising the excellent work that it is doing in the DRC and the great lakes region more broadly? It was encouraging to see that the work that was started under the previous Labour Government is continuing under this Administration.
I echo what my hon. Friend the Member for Falkirk said about the elections. Will the Minister tell us what progress has been made towards free and fair elections? My hon. Friend also mentioned the importance of monitors in the previous election. Clearly, monitoring will be even more vital if the election is to be run by the Congolese themselves rather than by the international community, as has happened previously.
I echo what the hon. Member for Wolverhampton South West said about the role of women in the Congo. Although we met some amazing women politicians in the region, women are sorely under-represented in Congolese politics. When we were in Goma, we met women who had survived rape and other forms of gender-based violence. An incredibly courageous five-year-old girl who had been the victim of a rape calmly told this group of strangers from the United Kingdom the story of her ordeal, which she had already had to describe in court.
I ask the Minister to say something about progress towards the millennium development goals. There is real concern about the continuing high levels of infant mortality in the Congo and low levels of primary school enrolment.
A major focus of our visit was the minerals question, which my hon. Friend rightly focused on today. Perhaps the Minister will update the Chamber on progress at a European level to some kind of European version of the Dodd-Frank legislation that has been adopted in the United States.
At the end of the visit, I had the opportunity briefly to go to Kigali in Rwanda, which has made remarkable progress since the genocide in 1994. The United Kingdom has played an important role in supporting that progress. Clearly, there are concerns about relations between Rwanda and the DRC, especially in relation to the impact of the Rwandan Government’s wish to invoke the cessation clause in December 2011, which might exacerbate tensions in the Kivus. I would be grateful to the Minister if he were to say something about that today.
Clearly, there is concern about lack of freedom of the media in Rwanda. I had an excellent meeting with the UK high commissioner in Kigali, and I recognised that the British Government are supportive of efforts to see an opening up of the Rwandan media. I want to put it on record that I appreciate the efforts that are being made by the UK high commission in Kigali.
Mr Angus Brendan MacNeil (Na h-Eileanan an Iar) (SNP)
The hon. Gentleman has raised his justifiable concerns about Rwanda. Having been to Rwanda myself with RESULTS UK earlier this year, one of the things that came home to me are the great strides that have been made there. Kagame might have his critics, but if he was being toted around Africa as part of a transfer system for political leaders, he would probably be No. 1 in the African transfer want league.
Stephen Twigg
I agree with the hon. Gentleman. In the five years when I was out of the House, I worked with the Aegis Trust, which established the Kigali memorial centre to the genocide. As friends of Rwanda, we should put it on record that incredible progress has been made under President Kagame, but we must also be candid when we have concerns. I want to put my concerns on the record without in any way detracting from the truly remarkable achievements of that country since 1994.
The Parliamentary Under-Secretary of State for International Development (Mr Stephen O'Brien)
I thank the hon. Member for Falkirk (Eric Joyce) for securing this debate and for giving me the opportunity to reply. I am glad that DFID has been chosen to reply, because it will give me a chance to cover some of the development issues. Much of what is relevant to the DRC is Foreign and Commonwealth Office business, but hopefully I will be able to cover both areas.
The hon. Members who have recently returned from their visit to the region will have had a rewarding and informative visit, as indeed I did when I went with the Minister with responsibility for Africa on a joint visit to the DRC. I went to Rwanda last year. Great challenges remain in all the areas that we visited. The overriding priority is to continue to bring sustainable peace and prosperity to the great lakes region.
There are also an enormous number of potential opportunities, but many of them are choked off, because the conditions for them to be usefully explored are simply not yet in place. Much of the potential is still largely untapped. Let me address the points that have been raised by setting them in the appropriate context. I want to take this opportunity to explain how her Majesty’s Government, through DFID in particular, are trying to help to unlock the potential in the DRC and the great lakes region.
The DRC is still recovering from the shock of Africa’s first inter-state war in the modern age, which was laid on top of decades of corruption and misrule. Recovery is hampered by continuing lawlessness and armed violence, particularly in the east. The country is physically disconnected, and politically highly disjointed. The hon. Members for Falkirk and for Liverpool, West Derby (Stephen Twigg) have mentioned that the elections must be seriously monitored. That monitoring process will be welcome, because it will encourage independent verifiability At the same time, we must work with civil society organisations to enable them to use their voice and express the various views across the DRC. We all welcome the broad sentiments that were expressed. We hope that the elections go well, and we will do everything that we can to assist the country at this time. It is important for the credibility of the Government that the elections go well. At the same time, though, we must not rush to judgment, and we must enable the process to go through rather than assuming the worst.
The DRC has some of the worst social indicators in the world, and it is far from achieving any of the millennium development goals, which is one of the questions that I have been asked. Violence against women is endemic and horrifying. The country is second to the bottom of the “doing business” league table. Although growth has been sustained through the past decade, the public purse is still far too small to meet basic needs, so there may well be a very small tax take on taxable transactions of value even under normal regulatory conditions. Clearly, there is a lot of work to be done there.
We must all recognise that the MDGs are way off track. That is true whether we consider the number of children being enrolled at school or the number of girls staying on at school. All of us who care about development issues need to consider how we can meet the MDGs and how the UK, through DFID, can make a transformative difference and help to deliver on those MDGs, The DRC has to be our main focus, which is something that we are determined to do.
There are signs of hope, and our new country programme in the DRC aims to build on those signs. Macro-economic management has improved, which led to international debt relief being granted last year, as I am sure hon. Members know. In addition, levels of violence are slowly dropping, although the amount of violence in the DRC is still extremely high as measured against all comparators. Nevertheless, we must recognise that there has at least been progress in terms of the trend rate. And the DRC Government are showing a greater will—the practice is a long way behind, but there is a greater will—to get the minerals sector under control. I do not mean “control” along the lines of one unfortunate recent incident, which actually amounted to sequestration. What I mean by “control” is appropriate regulation, whereby there is an appropriate opportunity for businesses to take a risk in a predictable environment and for there to be a yield to the country’s exchequer under a system of democratic and transparent accountability, which will then be used for the benefit of the people of the DRC rather than to reward any form of elite.
Anas Sarwar (Glasgow Central) (Lab)
I am sure that the Minister is sick of the sight of me, after he spent two hours in front of the Select Committee on International Development this morning discussing this very region and specifically Burundi. I want to make a point about mineral extraction. As he knows, members of the International Development Committee have recently returned from visiting the DRC and one of the most shocking statistics that we heard while we were there is that $400 million of gold is extracted each month in the DRC, but only $28,000 is paid in tax each month for that gold. What is his Department doing to try to get greater transparency and hopefully some binding agreements along the lines of the extractive industries transparency initiative and the Dodd-Frank Act?
Mr O'Brien
The hon. Gentleman is entirely right to make that observation. There are various estimates about the DRC, but what he has just said is broadly what we all understand to be the case. Part of the answer lies with what the hon. Member for Falkirk hinted at earlier. He suggested that the lack of confidence among foreign direct investors—confidence they can take the risk of going into the DRC and using their world-class skills to extract the unique assets that the DRC is particularly blessed with—means that 80% or more of all the gold that is mined in the DRC is extracted by artisan extraction, as is the case with the other valuable minerals found in the DRC that are sought on world markets. Of course, that makes it almost impossible to capture the revenue from that activity within any kind of regulatory environment.
That is why we are putting such emphasis in the design of the DFID programme on considering what will create the conditions for private sector development. By that, I mean not just foreign direct investment, which is important, but measures that will help regional economic integration. That economic integration is important not only in the east of the region, which we discussed extensively in the International Development Committee this morning, but across the various corridors in the region, particularly the north-south corridor that includes the copper belt in Zambia and the Katanga region of the DRC. That corridor will be vital for the future of many countries in southern and eastern Africa as trade passes up and down it.
The hon. Member for Glasgow Central (Anas Sarwar) referred to the extractive industries transparency initiative. As he knows, we are a strong supporter of that initiative for resource-rich countries. It is absolutely the right way to ensure that, as part of the measures to build confidence and credibility, people are genuine in both countries—both the UK and the country from which the materials are being extracted—and companies must sign up to it. Both the hon. Gentleman and I welcome the DRC’s efforts fully to implement the EITI.
On the Dodd-Frank issue, I hope that the hon. Gentleman knows that my right hon. Friend the Chancellor made it clear at the G20 Finance Ministers meeting in February that the British Government support the development of new international rules that, to some degree, are prompted by the Dodd-Frank Act in the US. Such rules would require oil, gas and mining companies to report payments that they make to Governments. The UK seeks to make progress on that issue in both the G20 and, very importantly, within the EU. This process will work if we move together, so that both a combined, common purpose and combined, common standards and values are reflected in the way those reporting mechanisms are developed.
While I am discussing minerals, perhaps I should talk about PROMINES, which the hon. Member for Falkirk referred to. As he knows, the British Government are co-funding that project with the World Bank, and I was grateful for his complimentary remarks about it. It is a major minerals sector reform programme. A PROMINES agreement is about to be signed with the DRC Government, and it will tighten up regulation in the DRC’s minerals sector. Obviously, we hope that it will improve conditions for mine workers and increase tax revenues from mining, which is another issue that we have discussed. That agreement has been cleared by the World Bank’s executive board, and we expect the DRC Government to sign it within the next few weeks. That is progress.
If the hon. Gentleman will forgive me, I will not comment on the particular case of First Quantum Minerals, because it is the subject of an ongoing dispute.
In recent years, we have gathered a lot of evidence about how to work effectively in war-torn and fragile states, and the key issue is ensuring that we learn from that evidence. Learning from such evidence, alongside a renewed emphasis on results and value for money, has helped us to develop the new country programme that we have now put in place for the DRC. Through that programme, we believe that we can deliver fantastic results in what is, by any test, one of the world’s most difficult aid environments. We believe that we can combine major improvements in basic services, which are much needed, with new efforts to promote trade and investment and, of course, new efforts to create wealth. If we can find ways to create wealth for the broader population, that would be the biggest reliever of poverty.
Over the four-year period of the spending review, we have a total aid budget for the DRC. For the two inner years of that four-year period, we have settled on a budget of about £147 million and £165 million respectively. We will review the progress that is made in the DRC, because we want to ensure that milestones are being identified and that we are achieving results. If progress is made, we have signalled that we want to have a total aid budget for the DRC over the four-year period of about £790 million. That would obviously mean a significant increase in the two outer years of that four-year period.
Without wanting in any sense to undo the absolutely essential element of being in a partnership with the DRC Government in this work, the modalities of delivery have to take place. Often that means that we are unable to use Government systems—for no other reason than that the Government systems do not exist. We must ensure that there is a sense of “earned increase” because progress has been banked and secured, because it is real and sustainable, because it is pro-poor and because it does not benefit those for whom aid might be regarded as being unjustified.
That aid programme will allow us to address the point that was made very forcefully by my hon. Friend the Member for Wolverhampton South West (Paul Uppal) about women in the DRC who are subject to appalling violence, including sexual violence such as rape and female genital mutilation, and who lack access to economic opportunities, including any form of land registration, which would give them the incentive to move into the economic sphere. We hope that we learn the lessons about all those factors.
Jim Shannon
Does the Minister have any concern about the influence of China in the region at present? I believe that there is great concern about it among a great many people in this Parliament and indeed in other countries, too.
Mr O'Brien
The issue is how we all operate in the various countries of Africa. The essence of that is partnership and recognising that we can make a great contribution through development spend, giving aid where appropriate but also having a programme whereby over time we can graduate away from giving aid. Equally, China has an enormous interest in terms of capital expenditure and infrastructure development. Instead of seeing that as a form of competition, there is a real opportunity, which we hope to develop, of having more of a consortium approach, whereby we can partner and perhaps use some of our technical assistance skills allied to the resources of what is unquestionably the world’s greatest capital investor. We must also ensure that the benefits of such investment are truly mutual, because nobody enters into a contract without mutuality. Moreover, mutuality must include the poor people of the countries in which the operations take place. Those are ideas that we want to take forward.
I am very conscious that this debate is not only about the DRC but about Rwanda and Burundi, too. Although the neighbourhood issues, not least those affecting areas across the border from Rwanda, are still not sufficiently calm, settled and satisfactory, there has been enormous progress given the cycles of conflict that have played out over recent decades, both in the post-colonial period and more recently. I am pleased to see the hon. Member for Liverpool, West Derby in Westminster Hall today, because I know myself, having been to Rwanda, the great work that the Aegis Trust has done to find a fitting and indeed deeply moving memorial to the events in Rwanda in the 1990s—it defies belief that those events were taking place in our lifetime.
The future progress of Rwanda cannot be taken for granted. There is still an awful lot that needs to be done to build upon the successes that have been achieved so far. There must be strong and legitimate institutions, security and the rule of law to ensure that there is a more open political space, an ability to tolerate media plurality and a lessening of the strains with neighbouring countries. As is widely known, we have a plan to increase our commitment to Rwanda in the future.
I will touch on Burundi briefly. Burundi was discussed extensively in the International Development Committee this morning, but in the last half-minute of this debate I hope that I can at least summarise matters and say that we have thought very carefully about the appropriate modality of delivering continuing aid to Burundi. In particular, we can work through TradeMark East Africa, which is the operating end of the East African Community, and Burundi stands to benefit enormously from the improvements in infrastructure and lowering of costs that are necessary to participate in economic development, while other donors—particularly multilateral donors—fill the gaps.