Westminster Hall

Tuesday 17th April 2012 Westminster Hall

Tuesday 17 April 2012

[Sir Roger Gale in the Chair]

Budget (North-East)

Tuesday 17th April 2012 Westminster Hall

Motion made, and Question proposed, That the sitting be now adjourned.—(Mr Newmark.)

09:30

[Sir Roger Gale (in the Chair)]

Good morning, ladies and gentlemen. I need to make it plain before we start that I have applied to the office of the Chairman of Ways and Means for a time limit on speeches. A significant number of Members have written to the Speaker indicating that they wish to participate, and even more Members are present. Given that we will need to call the Front-Bench spokespeople at 10.35 am at the latest, I suspect that we will be down to four minutes per person, but that rather depends on Mr Mearns.

[Ian Mearns (Gateshead) (Lab)]

I thank the Speaker’s Office for allowing me to initiate this debate, and also the many Members who have come along. The debate has created significant interest, particularly in our north-east region.

In the Chancellor’s millionaires’ Budget, which will hand back tens, if not hundreds, of thousands of pounds to some of the richest people in our society, including some of his Cabinet colleagues, it is clear who will suffer the most. It will be the poorest, those looking for work when few new jobs are available, pensioners, families, the hard-working, the squeezed middle and the working poor.

Following the Chancellor’s Budget speech, the Treasury produced a briefing highlighting the measures that will benefit the north-east of England. The region has borne the brunt of this Government’s policies. February 2012 figures show that unemployment in my constituency has risen from 8.3% to 10.5% since the coalition took office, and in the latest Office for National Statistics survey, up to January 2012, the figure for the north-east as a whole has risen to 10.8%, yet the Treasury’s briefing runs to a grand total of three measures that it claims will specifically benefit the region.

Although the first measure—the increase in personal allowances—is welcome, it can hardly be regarded as specific to the north-east. The second measure is that Newcastle will receive the princely sum of £6 million, and become a super-connected city. Perhaps the Chancellor and the Treasury do not realise that Newcastle, as important as it is to the entire region, is not the entire region—in fact, it has about a tenth of the region’s population. Finally, in the month when the north-east is losing its regional development agency, its local enterprise partnerships will receive a paltry £10 million from the Growing Places fund.

In the Budget statement, the Chancellor notably consigned to the dustbin of history the phrase, “We’re all in this together.” The imbalance in this Budget means that most of us are in this together, but the few at the top of society will be exempt from it all. The regional disparity is all too plain to see. In the three south-east regions— London, the south-east and the eastern region—nearly 195,000 taxpayers will reap the benefit of the Chancellor’s higher-end tax giveaway, but in the north-east the figure will be fewer than 5,000, and about 4,000 in Wales.

[James Wharton (Stockton South) (Con)]

Is it not the case that nearly 1 million taxpayers in the north-east will benefit from the personal allowance increase, and that it is the poorest taxpayers in regions such as ours who will benefit?

[Ian Mearns]

That would be the case if it had not been for the hikes in VAT, which as an indirect tax particularly disbenefits the very poor in regions such as the north-east. There are significant figures showing the genuine disbenefits of that for poor people.

When William I sought to quell the north following the Norman conquest, he developed a slash-and-burn policy to subjugate the unruly barons and the Saxon citizenry, and the people of the north-east could be forgiven for thinking that the Government had developed exactly the same approach—a 21st-century scorched-earth policy for the north. In just two years, they have abolished our Minister for the north, our local authorities have had to deal with massively disproportionate cuts, our regional development agency has been eradicated and there has been a miserly investment in transport and infrastructure projects, at the same time as disposable income has been sucked out of our pockets and our high streets. My local Gateshead authority has had to cut £70 million from its budget—equivalent to £88 per head of population—losing 1,500 staff into the bargain. The average cut for the 12 north-east councils was £84 per head of population, while the 12 least-deprived local authorities in England, including Windsor and Maidenhead, Richmond upon Thames, West Berkshire and West Sussex, each lost an average of less than £20 per head of population, so we are clearly not all in this together.

Almost every aspect of the Budget looks as if it was designed to have a negative impact on the north—on our people and on our businesses. VAT on takeaway food not only most affects people with the lowest incomes but has reduced the value of Tyneside businesses, including Greggs plc, which saw £20 million to £30 million wiped off its share value when the “pasty tax” was announced. I have no doubt that the measure will also have a negative impact on the work of the Greggs Foundation, which last year donated £1.4 million to support breakfast clubs for 65 north-east primary schools, at least four of which are in my constituency. The foundation also supports youth groups in some of the most deprived communities of the north-east, and also in Scotland and Wales. So much for the big society.

In addition, the Government’s welfare benefit changes will have a massively disproportionate impact on regions such as the north-east. Currently, 11,000 people in Gateshead claim incapacity benefit and, together with the numbers on jobseeker’s allowance, almost 24,000 people are claiming out-of-work benefits. National figures show that of those people undergoing the work capability assessment, 37% have been found fit for work and 34% have been placed in the work-related activity group of employment and support allowance, but for the vast majority of them in the north-east there is no real prospect of work in the near future. If the national figures are mirrored in Gateshead, almost 8,000 people will be moved off incapacity benefit and receive lesser benefits, if anything at all.

I am told by Gateshead council that the introduction of universal credit will result in 14,500 tenants having to manage a larger personal contribution each week, which will increase demand for budgeting and money management skills, and risk more tenants being unable to manage their household budgets and resorting to expensive borrowing, including legal and illegal loan sharking. The risk of non-payment of rent, based on a calculation rate for sums not covered by housing benefit, could result in an additional £20 million not being there to be collected by local authorities, which are already struggling to cope with the punitive cuts they have endured.

Benefit reductions for under-occupancy will affect 3,478 of our current tenants in Gateshead—18% of all those with the Gateshead Housing Company. Of those, nearly 3,000 have an extra bedroom and could therefore face a 10% to 15% reduction in their benefit, and the 815 who have an extra two bedrooms could face a 20% to 25% reduction. If we magnify those numbers across the region, we could be dealing with a widespread social crisis.

[Mr David Anderson (Blaydon) (Lab)]

I congratulate my hon. Friend on securing the debate. Is the bedroom tax not an example of how much the Government are out of touch with real people? It is not just about the costs. People who have lived in a community for decades will be forced to move because they will be unable to afford to live there, and everything they have built up over many years will be thrown away as if it means nothing.

[Ian Mearns]

My hon. Friend hits on an appropriate point. Regarding how out of touch the coalition is with the vast majority of people in regions such as the north-east, its lack of understanding of how the housing market works in such places is absolutely spot on.

I am a north-east Labour MP, so I suppose that no one will be surprised to discover that I am not impressed by the Chancellor’s support, or lack of it, for the region. However, the north-east’s business community is equally unimpressed. The North East chamber of commerce has said:

“The extra cut in corporation tax is welcome and will help stimulate investment in the UK. However, relatively few North East firms will benefit from this, and we would have preferred to see a greater focus on strengthening investment allowances and cutting employment taxes, to address the two key weaknesses in the North East economy.”

Although it does not deal specifically with the north-east, the Federation of Small Businesses wrote to me when it found out that I had secured this debate, asking that I highlight its concerns. The FSB said:

“We asked for a Budget with long-term measures to help to instil confidence, rather than a barrage of micro-measures that have a limited impact on the ground. We are pleased with some of the actions to cut the burden of red tape, help to get our young workers into employment, and measures to improve access to finance…However, petrol prices remain a major concern for small businesses and we would have liked some further action on reducing the level of fuel duty to help struggling small firms.”

The cost of fuel, although important to all UK businesses, is crucial to maintaining competitiveness in regions such as the north-east. One local business that makes plastic milk bottles informed me that its biggest cost is the cost of fuel. Let us face it: in effect, that business’s biggest cost is transporting its product, which is 90% fresh air, around the UK. Given the geographical location of the north-east and the vital importance of manufacturing employment, was it too much to ask that the Government reduce fuel costs for businesses and maintain jobs in the regions?

The Federation also commented that it welcomed the enterprise finance guarantee scheme, but said that recent figures clearly show that lending under the scheme is falling rather than rising, and that the Chancellor must do a lot more to encourage banks to increase their lending to small firms without requiring the excessive personal guarantees that deter small businesses, particularly in areas such as the north-east.

The Association of North East Councils, which represents the 12 north-east authorities, was also unimpressed, reporting that almost 50% of businesses in the region have no plans to increase staff numbers in the coming months but are hanging on before deciding on reductions. Weakening sales and poor service sector performance are still preventing much-needed growth to offset public sector employment cuts. Job loss in the north-east as a whole is four times deeper than in the rest of the country. None of that has been helped by the complete lack of recognition or action in the Chancellor’s Budget.

This Government are now doing to public services in the north what they did so successfully in the 1980s to our traditional industries of mining, shipbuilding and heavy engineering: bringing them to ruin and laying them waste. If the Government’s plan to replace those jobs is to build the private sector, why are they doing virtually nothing for the north-east? The main problem is not that they are doing nothing but that they are making things worse. For the young in particular, they are removing hope.

The Government have not recognised that for a region such as the north-east, geography and the new politics of the United Kingdom are realities that must be considered. Scotland is just over the border. The Scots at Holyrood still have economic development and tourism strategies and are still offering inward investment incentives, all important determinants whether a company invests in Scotland or the north-east, but the Chancellor and the Secretary of State for Business, Innovation and Skills seem oblivious. For example, Amazon, despite considering a site in the north-east, has located in Edinburgh, purely on the basis of the grants available. Given the existing imbalance in Edinburgh’s favour, the decision to locate the Green investment bank there seems like a political and economic knee in the groin for regions such as the north-east of England.

In last year’s autumn statement, the Chancellor made much of the Government’s plans for our national infrastructure, emphasising the importance of capital spending on infrastructure to support the UK’s long-term growth prospects. He outlined £30 billion in spending, including an immediate increase of £5 billion in Government spending. As one of their central economic priorities, the Government have defined a number of ways in which they wish to rebalance the economy away from over-reliance on public sector jobs and towards private sector employment; away from over-reliance on financial services and towards manufacturing and export industries; away from over-reliance on the south-east and towards more balanced economic growth across the UK.

The Chancellor’s statement emphasised that every region in England will benefit from that infrastructure spending. He even listed a host of road and rail projects in England in his speech. However, research by the Institute for Public Policy Research on the detail behind the Chancellor’s statement paints a different picture. Behind the empty rhetoric and claims of rebalancing, we find that 11 of the 20 largest infrastructure projects will benefit London and the south-east, only five will benefit the three northern regions and more than half of regional transport projects involving public funding will benefit London.

Considered together, London and the south-east account for 84% of planned spending, compared with only 6% for the three northern regions and an unbelievably minuscule 0.04% for the north-east. That equates to £2,731 per head of population for London and the south-east, more than all the other regions combined, compared with £201 in Yorkshire and Humber, £134 in the north-west and just £5 in the north-east of England. A fiver is what we are worth, in comparative terms, in the UK of today. For each £1,000 of gross value added generated in 2009, £81 is being spent on transport projects in London, £38 in the south-east, £12 in Yorkshire and Humber, £8 in the north-west and less than 50p in the north-east.

This Chancellor and this Government have spoken in duplicitous terms, but I now wonder whether they have given up even trying to talk a good fight when it comes to rebalancing the economy. They have clearly been saying one thing and doing another, looking after their home patch while slashing and burning the regions of England. To make matters even worse, they prefer to exemplify the north-east as a basket case. Before this bunch came to office, nothing could have been further from the truth. Thanks to the support of its 12 local authorities and the regional development agency, the north-east had developed an economy that was strong, dynamic and diversified compared with when a Conservative Government last laid waste to it in the 1980s.

However, in a typically knee-jerk, ideological and spiteful reaction, this Government have abolished our RDA, despite the fact that during the last three months of 2011, the north-east enjoyed record high growth in exports. Goods worth £13.5 billion were sold overseas from the north-east, up from £12 billion the previous year. If every other region in the United Kingdom were performing as well in those terms as the north-east, we would be doing rather well indeed.

Only yesterday, I received e-mail confirmation from the largest private sector employer in my constituency—AkzoNobel, known locally as International Paints—that last year it received an essential grant from One North East to support the establishment of its fire protection research and development facility. Recently produced documentation on the legacy of One North East showed that during the past 10 years, the north-east enjoyed the greatest level of economic growth outside London, and that during the last Government, the development agency helped to increase the region’s employment massively and its number of businesses and GVA to among the highest in the country.

Before the RDA’s inception, our regional economy was falling further behind other English regions. Since it was established in 1999, only London has experienced greater economic growth, but this Government have replaced the RDAs with local enterprise partnerships, which have no powers and little or no funding, and the much-heralded regional growth fund, which has delivered only modest amounts of direct aid to companies in the north-east.

From 1999 onwards, employment in the north-east rose at the third highest rate in the country after London and Yorkshire and Humber, and 116,000 jobs were created, representing growth of 11.2%. We also had the highest growth in new businesses, 18.7%, and the highest growth outside London in GVA per head of population. Tourism, conferencing and inward investment were all significantly boosted by the RDA’s “Passionate people, passionate places” campaign. The agency’s work on low-carbon vehicle production and green energy generation are legacies on which we could build if only the Government had a credible policy for the economy.

We had a credible policy for growth in the region, a credible policy for jobs and a credible policy to rebalance England’s economy, which included the idea that the north-east is a place to do business. Sadly, this Government have none of those, and prospects for my region remain bleak. Disposable income is being sucked out of our communities through public sector job losses, wage freezes and benefit cuts.

Before the recess, the Newcastle Journal published an editorial headlined “Never mind a Heathrow runway”, which stated:

“It would be a terrible shame if the row over party funding deafened the Government to the findings of the OECD. Its report makes grim reading for the region, but not simply because it highlights the problems caused by rotten infrastructure, poor connectivity and the lack of continuity in government. No, what really hurts is that a Paris-based organisation has been able to recognise basic, obvious, well-known facts that should not have been possible to ignore. Yet successive administrations in London have managed that feat damagingly well. Never mind arguing about a third runway at Heathrow, how about helping the North East instead?”

What are the Chancellor’s answers to these regional conundrums—a brain wave, a stroke of genius, an innovative investment package? No, what we got was the concept of regional pay. If that is the direction that he wants to take, perhaps we could also ask him to consider regionally reduced utility bills for gas, electricity, water and telephones, and while we are at it, cheaper council tax and grocery bills. If the Chancellor or the Prime Minister fancy paying £250,000 for the privilege of dinner with the chief executives of Tesco, Sainsbury’s, Asda and Morrisons, they could ask them, “Could the supermarkets reduce the cost of shopping in the regions, please?” They could also ask representatives of the east coast main line to charge regionally reduced fares for journeys to London.

[James Wharton]

I thank the hon. Gentleman for giving way to me for a second time. When the previous Labour Government introduced localised pay for the Courts Service, did they also introduce the other measures that he has mentioned?

[Ian Mearns]

I am afraid that I am not familiar with the position outlined by the hon. Gentleman, but I am not convinced that he is entirely right.

Why do we not go the whole hog on regionalism and consider re-establishing the RDA and setting up a regional Parliament for the north-east? If regionalism is so much in the minds of coalition Members, let us go the whole hog.

The Budget’s impact on the UK regions demonstrates clearly the Government’s ideology. Despite the negative impact of the Budget and their lack of regional policy, the north-east economy still has vibrant and dynamic aspects, as testified by the expansion of the Nissan plant at Washington, which will make it the largest and most efficient car plant in the world; the growing strength of our offshore wind and green energy sector; and, of course, the relighting this weekend of the Sahaviriya Steel Industries steel blast furnace on Teesside. That good and welcome news, however, does little to offset the negative measures inflicted on us by the coalition. The developments are welcome but small compared with the damage that is being wreaked. We have many skills on tap and a willing supply of people who are currently being denied access to the basics of the fruits of a civilised society through work.

The north-east will survive the economic crisis, but it will have to do so without support from this Government. As a result, many of the region’s people will suffer in greater measure and in greater proportion than the constituents of most Government Members.

The Budget has demonstrated clearly the ideological drive of this Government of Tories and Liberal Democrats. It is not about fairness. It is not about, “We are all in this together,” and it is certainly not about pulling together for the collective good, the benefit of the whole country or for every region in the UK. Under this Government, the Chancellor has given millionaires tax cuts, while pensioners have to pay more. Cabinet members and their chums receive unwarranted and undeserved benefits, while hard-working families suffer. Frankly, the well-off and the well-to-do are looking after the interests of their peers—toffs looking after toffs, with little or no regard for the consequences for the millions for whom the experience will be negative, if not dreadful.

Thanks to the Budget, the north-east and the regions of the UK will continue to struggle to grow and maintain employment and prosperity. The vast majority of my constituents and my region condemn the Budget. We need to maintain and increase the pressure to provide the policy and taxation framework that this country and regions such as the north-east need. The framework has to be designed to secure growth, and to support businesses, regions and our most vulnerable and economically fragile communities. The north-east demands that the Government respond to that challenge. If they are not willing to rethink their outdated and massively inappropriate attitudes to our region and its people, they should get out of the way and make room for a Government who will.

[Several hon. Members]

rose—

[Sir Roger Gale (in the Chair)]

Order. In view of the large number of Members who wish to participate in the debate, I will exercise the power granted to me by the Chairman of Ways and Means and limit speeches to four minutes. I intend to commence the winding-up speeches at about 10.40 am. The Opposition Front-Bench spokesman has kindly indicated that he is willing to curtail his remarks to about five minutes. It would not be reasonable to impose any such limit on the Minister, because of the large number of Members who want to participate and who will expect answers to the debate. Members will notice, if they do the math, that I have built in a five-minute leeway, so one way or another we hope that we will get to where we want to be. The same rules apply as to the main Chamber. We will add a minute to the four-minute time limit for up to two interventions, but Members will appreciate that if that happens, someone will fall off the end of the list.

This is an exception—we do not normally do this—but it might help Members if I indicate now the order in which I intend to call them, because a significant number have written to Mr Speaker requesting the opportunity to speak. Those who are not on the list will appreciate that I have to give priority to those who have taken the trouble to write to Mr Speaker. They may, therefore, choose to exercise their right to intervene, although that, of course, is not in my gift, but in that of the person speaking. The order for Opposition Members is Grahame Morris, Phil Wilson, Pat Glass, David Anderson, Ian Lavery, Iain Wright, Sharon Hodgson and Stephen Hepburn; and that for Government Members is James Wharton and Mr Swales.

Westminster Hall does not have the countdown clock system of the main Chamber, but we do have the high-tech alternative of a bell, which will be sounded at one minute prior to a speech’s conclusion. Without further ado, I call James Wharton.

09:55

[James Wharton (Stockton South) (Con)]

Thank you, Sir Roger. It is a pleasure to serve under your chairmanship. I congratulate the hon. Member for Gateshead (Ian Mearns) on his passionate speech and on securing such an important debate. The issue is important to all of us who represent the north-east, in whichever party.

It is important to be clear that the north-east is not a basket case. It is not the end of the world and it is not a place where economic activity does not exist. There are many good signs of progress and economic success in our region. Unemployment in the north-east has been falling for the past two months, against the trend in much of the country, in what Members will agree is a difficult economic climate. There are many examples of significant good news stories, such as the relighting at the weekend of the SSI blast furnace on Teesside. That is very good and positive news, due in no small part to the sterling work of my hon. Friend the Member for Redcar (Ian Swales), who has fought long and hard to see steel-making return to that part of our region.

[Tom Blenkinsop (Middlesbrough South and East Cleveland) (Lab)]

Will the hon. Gentleman also acknowledge that the work to get SSI to purchase the Corus steel plant began in the summer of 2009 and was largely due to the work of the trade union on the site, which led the “Save our steel” campaign, in conjunction with Labour Ministers, who regularly met plant representatives, unlike this Government’s Ministers, who refused to meet work forces at Rio Tinto Alcan and—these are not in the north-east—at steel sites in Kent, such as Thamesteel?

[James Wharton]

The hon. Gentleman’s generosity in wanting to ensure that everybody who played a part is adequately recognised is testament to his character. The unions played a significant role, as did the Government of the day, when the plant’s closure was announced, as have the Government of today, in delivering the success. It is something about which we can all be pleased in our region and I welcome the hon. Gentleman’s comments.

We have also received the good news that Hitachi will come to Newton Aycliffe to build trains. Nissan has announced that more jobs are being created and more work being done. In my constituency, Nifco has just opened a new factory in Eaglescliffe—a smaller but none the less significant manufacturing investment—and is already considering options for expansion because it is doing well.

More than 47,000 private sector jobs have been announced in the regional media since the last election. Articles in the press report what is said and announced, the levels of investment and the positive news, yet all too often all we hear are the negatives. I am sure that we all agree on a cross-party basis that it is important to take every opportunity to talk up our region and make it clear to anyone who is considering investing there that we are open for business and looking to do business, and that we welcome investment and we want to see the jobs and growth it would create.

[Helen Goodman (Bishop Auckland) (Lab)]

We all agree with the hon. Gentleman that there should be willingness to invest in our region, but does he not understand that it is deeply problematic that only 0.1% of the extra capital investment announced by the Chancellor in his autumn statement came to our region?

[James Wharton]

I was, of course, referring to private sector investment. The hon. Lady makes an interesting point, but we have to look at the figures realistically. A lot of the spending that has been announced is for specific large projects, some of which are in London, such as Crossrail, and some of which will potentially benefit the north-east, such as High Speed 2. Although it is not yet coming to our region, the benefits are real.

The RDA has been mentioned. I have my differences with Opposition Members on that issue. I always felt that the RDA was too focused on Newcastle and as the hon. Member for Gateshead said, we must remember and acknowledge that Newcastle is not the entire region. I welcome the new local enterprise partnerships because they are more localised and more focused on the areas where the growth that we want to see needs to be delivered. From the growth that we are seeing and the investment that is being announced, the signs are that LEPs are already doing a good job. The LEP in Teesside is certainly doing an excellent job. It hit the ground running and is making a difference to securing the growth that we need in that part of our region.

There were, of course, a number of announcements in the Budget that will both directly and indirectly benefit our region. One of the most significant is the increase in the personal allowance. In total, across all the Budgets we have had so far from the Government, 82,000 people have been lifted out of income tax altogether in the north-east region. That significant and welcome benefit will make a real difference to the lives of tens of thousands of families across the north-east who are on the lowest incomes and who most need that support.

The increase in the personal allowance will also, of course, deliver improvements for our regional economy because that money is not being taken in tax and spirited away to London to be redistributed in accordance with the diktat of the Government—whoever they are. That money is staying in the pockets of families in the north-east, so that they can spend it in our local economy, provide a welcome economic boost and create jobs and growth, which is what we all want to see.

In the north-east, the income tax bills of nearly 1 million people will decrease, although some of them will not be entirely lifted out of income tax just yet. The child benefit tapering changes are a welcome mitigation of the impact of the need to control the child benefit bill because of the financial situation in which the Government find themselves. That will benefit 14,000 families across the north-east and is another welcome measure in the Budget that will leave more money in our regional economies and in the pockets of the people who live and work in the north-east and elsewhere. That policy will make a difference to our regional economy and the lives of those who live in the regions.

Negatives in the Budget do exist. Stamp duty land tax is increasing. However, we are lucky in the north-east because only 1% of the properties affected—

[Sir Roger Gale (in the Chair)]

Order. I call Mr Grahame Morris.

10:02

[Grahame M. Morris (Easington) (Lab)]

It is a pleasure to serve under your chairmanship, Sir Roger. I congratulate my colleague, my hon. Friend the Member for Gateshead (Ian Mearns), on securing this debate, the importance of which is testified to by the number of Labour Members present.

The Budget will have few positive benefits for the economy of the north-east, and there is no discernible regional support within the measures set out in the Budget statement. There are cuts in corporation tax and cuts in tax for the wealthy, but there is no credible plan for what is really needed in the north-east: a stimulus for jobs and growth.

The often used line that we cannot spend our way out of a recession has been shown to be an ideological mantra that flies in the face of economic reality. What the Budget has given us is rocketing unemployment and plummeting growth in regions such as ours. The north-east has the highest rate of unemployment of any UK region, at 10.8% of the economically active population. That is mirrored in my constituency where, despite the good news we have had from Nissan, large numbers of private sector job losses are in the pipeline. We are haemorrhaging private sector jobs at an alarming rate.

Regional economies such as the north-east will not make any headway without investment in a comprehensive and lasting economic infrastructure. That can only be done by the courageous state and by Government intervention. The north-east continues to suffer from the unfinished business of transition from heavy industry. However, that transformation has stalled as a consequence of the coalition Government’s policies.

The evidence supports the fact that Labour and our regional development agency, One North East, were making progress in transforming the economic landscape. An analysis from PricewaterhouseCoopers shows that, for every £1 spent by our RDA, an average of at least £4.50 of economic output was achieved. That rose to an output of at least £6.40 when future benefits were assessed.

Ministers have sought to propagate the myth that money spent in the north-east under Labour was wasted, but that is not supported by the facts. Based on the gross value added per head indices, the rate of growth in the north-east went from being the lowest of any region during the 1990s to being the second highest during the past decade. The facts and figures were alluded to by my hon. Friend the Member for Gateshead, so I will not repeat them.

[Catherine McKinnell (Newcastle upon Tyne North) (Lab)]

I congratulate my hon. Friend on his speech. Does he agree that another key role that One North East played in the region was to ensure that European regional development funding was drawn down and invested in the region? Some £329 million was made available, but £129 million remains un-invested directly because of the loss of One North East. No one is drawing down that funding and no regional funding can match that investment in the region.

[Grahame M. Morris]

Absolutely. I am grateful to my hon. Friend for putting that on the record. That was another vital element that the RDA contributed towards jobs and growth in the north-east, and it is sadly missed.

Although the Chancellor told us that the Budget is overall fiscally neutral, its impact by region, class or earnings is anything but. For example, VAT—a regressive form of taxation—remains at 20%, which hurts those who have no choice but to spend their wages on life’s basic essentials and depresses demand. The continuation of wage freezes throughout the public sector will make life even more difficult for ordinary people, as will the rise in fuel duty.

In his Budget, the Chancellor has failed the people whom I represent in Easington and in the north-east. There was the increase in VAT, the granny tax, the pasty tax, the philanthropy tax, increases in fuel duty and the loss of tax credits for modest earners. My right hon. Friend the Member for Doncaster North (Edward Miliband), the Leader of the Opposition, was right to call it a Budget for millionaires when what we need is a Budget for jobs and growth in the north-east.

10:06

[Ian Swales (Redcar) (LD)]

It is a pleasure to speak in the debate and I congratulate the hon. Member for Gateshead (Ian Mearns) on securing it. Labour Members’ contributions will no doubt be selective so I will not repeat them; instead, I will say a few things that they probably will not.

The increase in the tax threshold that my hon. Friend the Member for Stockton South (James Wharton) mentioned has taken another 35,000 people out of paying tax in the north-east and given 940,000 workers a tax cut. Those workers, including people who are on the minimum wage, would be paying an extra £400 a year under Labour’s tax plans. It would not have been a Lib Dem priority to cut the 50% rate to 45%, but let us remember that Labour’s love affair with the 50% rate lasted for one month out of the 13 years it was in power. For the other 12 years and 11 months, the top rate was 40%. The rate remains 5 percentage points higher than that.

[Grahame M. Morris]

Does the hon. Gentleman recognise that, in my constituency of Easington, 1,400 families on modest incomes will lose all of their child tax credit, which is worth around £545 a year? In addition, 350 working couples in Easington who earn less than £17,000 a year will lose all of their working tax credit, which could be worth up to £3,870 a year, if they cannot increase the hours they work from 16 to 24.

[Ian Swales]

I am sure that the hon. Gentleman has his statistics correct.

I will go on to talk about high-rate tax. The Government have cut from £250,000 to £50,000 the amount of pension contribution that can be claimed against tax. They have put a new limit on reliefs, raised capital gains tax from 18% to 28%, put a new tax on expensive houses and clamped down on tax avoidance. Labour has opposed those measures and charged the rich less in tax.

Let us talk about business. As soon as the Budget was delivered, Glaxo announced £500 million of investment, including a new factory in Cumbria and new manufacturing facilities at Barnard Castle, Teesdale. That was a direct result of the Budget provisions on pharmaceutical patents. As AstraZeneca has also shown, that will lead to huge investment in—

[Helen Goodman]

The key factor was the patent box changes, which were initiated by the Labour Government in 2010.

[Ian Swales]

I am sure the Minister will respond to that.

Of course our region needs specific help. I welcome the extra £1 billion for the regional growth fund, which has already helped 93 companies in the north-east and is targeted specifically at regions such as ours. Last week’s announcement of help for up to 1,000 jobs in Wallsend in the offshore wind industry was especially welcome.

These occasions usually include a lament from the Opposition for the RDA. However, I shed few tears for an organisation that, in the two years before the general election, spent £148 million on 96 projects in which the directors had to declare an interest, spent nearly £400,000 on gagging orders for 12 staff, and, according to Experian, left Hartlepool, Middlesbrough, and Redcar and Cleveland as the three areas of the country, out of 324, least able to cope with austerity.

[Tom Blenkinsop]

Will the hon. Gentleman give way?

[Ian Swales]

I have given way twice already.

I congratulate the Tees Valley LEP on the excellent start it has made and I welcome the further £11 million in the Growing Places fund announced for north-east LEPs.

The press has picked up on certain items in the Budget, so I will finish with three questions to the Minister. I have spoken to the directors of Greggs. Will the so-called pasty tax not move rather than remove the anomalies? I do not relish asking the Greggs staff to feel the temperature of my sausage roll before deciding the price. Secondly, to those worried about charitable giving, tax relief on charitable contributions that would otherwise be taxed at 50% effectively means the Government will match donations pound for pound. Should that use of taxpayers’ money really be unlimited? Thirdly, how do the Opposition justify a situation in which young people on the minimum wage, who are trying to make their way in life, are paying £600 more in tax than their grannies who are on the same income? As we move towards a threshold of £10,000 for all, is that not a matter of fairness? Budgets cannot please all the people all the time, but help for business and the big reduction in tax for basic rate taxpayers means that this one has a lot going for it.

10:11

[Phil Wilson (Sedgefield) (Lab)]

It is a pleasure to serve under your chairmanship, Sir Roger. I congratulate my hon. Friend the Member for Gateshead (Ian Mearns) on securing the debate.

People talk about investment in the region, and three examples of investment have been mentioned. GlaxoSmithKline in Cumbria, which also has a plant in the constituency of my hon. Friend the Member for Bishop Auckland (Helen Goodman), SSI in Redcar, and Hitachi in my constituency have one thing in common: they would not be there were it not for a Labour Government. They were the result of initiatives established and settled under a Labour Government and which came to fruition after the general election. From personal experience, I know how much time and effort went in to ensure that Hitachi came to the north-east of England—it was not certain that it would.

I set a “We are all in this together” test for the Budget, and it did not pass that test. Some 57,000 households in the north-east will lose tax credits. I met a young mother at the weekend with twins—two little boys—who will start school in September. She has lost more than £300 in tax credits every month. That is a lot of money for someone with a young family. I know that 940,000 people will be better off under the new tax threshold, but let us not forget that the Institute for Fiscal Studies has said that the changes coming in this month will mean that on average they will be £511 worse off.

[Tom Blenkinsop]

My hon. Friend gave three examples of programmes starting under the Labour Government: SSI, Hitachi and GSK. That is also the case with DigitalCity in Middlesbrough, where public-led investment increased private-led investment. The hon. Member for Redcar (Ian Swales) referred to information from Experian in relation to Middlesbrough, Hartlepool and Redcar being the hardest-hit areas, but those statistics related not to the RDA, but to an investigation post this Government’s autumn statement.

[Phil Wilson]

My hon. Friend is right. That proves how much we have to celebrate what the previous Labour Government did for the north-east of England. The hon. Member for Redcar (Ian Swales) mentioned the minimum wage. The minimum wage has been frozen for people under the age of 21. It has gone up by only 11p this year as a consequence of the decisions made by this Government. At the same time, 4,000 to 5,000 taxpayers on the 50p tax rate in the region will on average receive a tax cut of £10,000 each. If that does not show that we are not all in this together, I do not know what does. The Government put VAT on pasties, but they did not put VAT on caviar.

The 40p tax rate has been ignored by many people. The threshold has been reduced from £42,475 to £41,450, so that 300,000 people will be brought into the 40p tax rate. How many more people will lose a proportion of their child benefit because of the reduction in that threshold? Will the Minister indicate whether she knows that figure? By reducing the threshold, the number of people paying the 40p tax rate in the region has gone up by 8%. There are now nearly 110,000 people paying the 40p tax rate. Little by little, the Government’s fairness agenda is being found out—actually, we are not all in this together.

I am very concerned about regional pay. The hon. Member for Stockton South (James Wharton) mentioned the flexibility in local pay in the court system, but we reduced the number of bands from 40-odd to five; we did not increase the number of bands. The latest survey by the TUC states that 68%—more than two thirds—of Conservative voters do not believe that regional pay in the public sector will boost jobs in the private sector.

The Budget is divisive. It is also complacent. It does nothing for growth, not just in the north-east of England, but in the rest of the country.

[Sir Roger Gale (in the Chair)]

Order.

10:17

[Pat Glass (North West Durham) (Lab)]

I congratulate my hon. Friend the Member for Gateshead (Ian Mearns) on securing the debate, which has allowed so many hon. Members from the north-east to talk about the impact of the Government and the Budget on our region. It is disappointing that we have such a poor turnout among Government Members—one Tory MP and one Liberal Democrat MP. That is less than 50%. It is amazing to hear them speaking with one voice—“We are all Tories now”—and to hear the Liberal Democrat MP defending the 50p tax rate, the granny tax and tax cuts for the rich. Either the Liberal Democrat hon. Members have Stockholm syndrome, or they have no principles and never did. I think that we would all say yes to that.

The Prime Minister, before the 2010 election, talked a lot about the need to rebalance the economy from the south to the north and for the north-east to be less reliant on public sector jobs. However, if we have seen any rebalancing of the economy at all, it has been from the north to the south. Public spending cuts have had a massive impact on jobs in the north-east in particular. The north-east now has the highest unemployment rate of all the northern regions at 10.8% and has received higher than average cuts to local government grants and services. In my constituency, unemployment has doubled since 2010. The hon. Member for Stockton South (James Wharton) said that unemployment has fallen in the region. I do not know what he defines as the north-east region, but it certainly does not cover the area that I represent. Youth unemployment in my constituency is now dangerously high, and the Minister needs to be aware of that.

I can tell the Minister that despite a lack of growth in the economy generally since 2007, there have been some areas of real growth in the north-east. I visit companies in my constituency all the time, and there has been something of a renaissance in engineering and manufacturing, but at the high-level specialist bespoke end of the market. In those areas, manufacturers have told me that what they needed from the Budget was more highly skilled toolmakers and specialist engineers, to enable them to take on more of the work that is out there. The Government failed to deliver that in the Budget.

Chemical companies in my constituency have also told me that they have full order books but need more highly skilled chemical engineers to take on more of the work that is out there. The Government’s shabby excuse for an apprenticeship programme will not deliver the skills that those companies need. The Government again failed to deliver on that in the Budget. Other companies—good companies with good products—are struggling.

[Ian Swales]

Does the hon. Lady agree that nothing done three weeks ago will deliver a chemical engineer to a company tomorrow and that the previous Government’s failure to deliver the skills agenda over the past 10 years is the problem for manufacturers and engineers in the north-east?

[Pat Glass]

The Budget is a good opportunity and a good place to start, but if this is going to be done, now is the time to start. Did we see that? No, we did not.

Good companies with good products are struggling to get investment. They tell me that, despite the Government’s rhetoric, banks are refusing to invest in good companies that would give a good return. Banks still prefer to spend our money in the speculative markets, risking it, because that brings high rewards and gives bankers bonuses. The Government failed to do anything about that in the Budget.

I am on the doorstep all the time, knocking on doors. When people open their doors, I do not have to say anything: they tell me that the message from the Budget is that the Government are giving tax cuts to millionaires at the expense of pensioners. The Government do nothing and have been a disaster for the north-east region. If they cannot do something about that now, as my hon. Friend the Member for Gateshead said, they need to move over and allow a Government who are interested in the regions to take over.

10:21

[Mr David Anderson (Blaydon) (Lab)]

I shall break with the habit of a lifetime and say something good about the Government. I welcome the news about what is happening with Nissan, but the context is that without intervention from our Government four years ago, Nissan might not have been in the position that it is in now. We introduced the scrappage scheme and reduced VAT. We gave grants so that battery electric cars could be developed and brought forward the training budget, which kept people from being laid off. Compare that with what the present Government did in respect of the building schools for the future fiasco. In Gateshead alone, £80 million was earmarked for five schools in March 2010, but the Secretary of State for Education took that money away in May, despite recognising, in meetings with me and my hon. Friend the Member for Gateshead (Ian Mearns), that the schools needed to be refurbished and rebuilt. The crazy thing is that, although the money would have gone to Gateshead council, it would just have passed it on to the private sector to build and furnish the schools and put the infrastructure in. So now everybody loses, including the public sector, the children and the private sector.

The RDAs have been mentioned a lot. The RDA was successful in the north-east of England. We have been here before; this is not new for us. Exactly the same programme and attitude that we saw in the 1980s and ’90s is being repeated now. People are being thrown on the dole with no hope or support, no way forward and no framework for intervention. The RDA worked because people came together—unions, employers and the public sector—partnership building, working together, bringing in international support and making things work. That is why it is a real shame that the RDA has gone and has been replaced by the regional growth fund, which is nothing more than a farce and a joke.

[Ian Lavery (Wansbeck) (Lab)]

My hon. Friend tells me that during discussions on the RDAs in the main Chamber, on more than one occasion senior Ministers—in fact, the Secretary of State for Business, Innovation and Skills—said that the RDA in the north-east was the flagship RDA and was working very well indeed.

[Mr Anderson]

I could not agree more. People will remember when they could believe what the Liberal Democrats said, although that was some time ago. The Secretary of State for Business, Innovation and Skills now says that he supported the RDAs, but the leader was not sure. It is now clear that the Liberal Democrats are being dictated to for ideological reasons. Anything that smacks of being positive about the public sector has to go. That is why we are suffering in our region.

Look at chaos and incompetence that has come from the Budget. People at the bottom have been hit: people with disabilities, old people, vulnerable people, children and women. Benefits have been cut. Millionaires have had tax cuts while pensioners’ tax levels are frozen. Government Members talk about taking people out of tax. They have taken a lot of people in Gateshead out of tax: 1,600 people have been taken out of tax because they have been put on the dole by the cuts, and 710,000 people from the public sector are being put on the dole and will not be paying tax or national insurance and will not be buying goods and services. Lessons from the past have not been learned. These things will have an impact on the economy.

The pasty tax is, to some extent, a joke. However, I am worried that it is classed as a harmonisation and simplification of the tax system; if that is so, will the Minister tell me what else she is going to simplify and harmonise that does not have VAT on it? Are there any other plans to increase the scope of VAT? Will she give us a guarantee today that VAT will not be extended to any other part of the tax system?

We all know about the impact of the charities tax. Because the Government cannot control the people who are avoiding and evading tax, the charities that the Government expect to cover for the job and service cuts in the public sector will not be able to do so. Charities in my region tell me that they are already suffering because of funding cuts and that, if money does not come from private investors, they will go even further down that road.

The application of VAT to listed buildings has had a disastrous impact. Ryton Holy Cross church in my constituency magnificently raised £300,000 in 15 years. Now, it would have had to raise £360,000 to do exactly the same work. People are telling me that that fills them with despair.

This Budget exposed the Government’s incompetence. They are not up to the job. The best thing that they could do for our region and our country is to go now.

10:26

[Ian Lavery (Wansbeck) (Lab)]

The Budget is a great missed opportunity, not only for the north-east but for the whole country. It should have been a Budget for jobs and growth, but instead it was a Budget for tax cuts for the rich and the toffs.

Unemployment rates in the south-east of Northumberland—in my constituency—are alarming. According to the Library, statistics revealed last week showed that, on average, 22.2 people were applying for each jobseekers’ vacancy. Earlier this year, according to the Office for National Statistics, that figure was 55.5. Every time we mention the problems faced by unemployed people in our area, we are told that we should look at the positive signs, such as Nissan. Nissan has been and is tremendous, but it is a million miles away from where I live.

[Grahame M. Morris]

I am sorry to stop my hon. Friend in full flow, but it is important to place on the record that, although we welcome the additional jobs and the announcement about Nissan, it must be put in context. Does he agree that although 250 jobs are welcome, they do not go anywhere near even offsetting the private sector job losses in my constituency alone? Reckitt Benckiser has lost 500 jobs; Fortress Doors has lost 100; Carillion, Cumbrian Foods and, most recently—

[Sir Roger Gale (in the Chair)]

Order. I am terribly sorry, but the hon. Gentleman is beginning to make another speech. This must be an intervention. I remind hon. Members that each of the first two interventions adds a minute to the time that the speaker is allowed. Hon. Members are in danger of pushing one of their colleagues off the end of the list, if they are not careful.

[Ian Lavery]

Thank you, Sir Roger. I agree with everything that my hon. Friend said.

We in the south-east of Northumberland are a million miles away from Nissan. The perceived jobs bonanza at Nissan is two bus journeys, a Metro journey and a further bus journey away. We wish that we had the same opportunities as there are at Nissan. We hope that they will come. We have not even got a rail service in my area: there is a railway line but no trains to run on it. We cannot even get to Newcastle, Sunderland or Middlesbrough city centre from where we live, because there are not the transport links and the much-needed transfer links.

I want to focus on a strong appeal to the Minister to hear the case of the people in south-east Northumberland. If we in Wansbeck are to have an opportunity for growth, a Northumberland extension of the North Eastern local enterprise partnership enterprise zone—the port of Blyth and the estuary—needs to benefit from capital allowances and rate relief at the same time. It is not enough to extend the enterprise zone without the provision of the additional allowances and incentives necessary to attract businesses and jobs. We need those guarantees. In addition, with the appropriate allowances and incentives, further extension to the enterprise zone is desperately needed, so that it stretches through Wansbeck as far up the coast as the Alcan site. A failure to do so will place Wansbeck and south-east Northumberland at a distinct disadvantage, by further damaging employment opportunities for our communities.

[James Wharton]

On a point of regional, cross-party unity, I echo the hon. Gentleman’s calls. The enterprise zones are a good initiative of the Government, and I should like to see them extended. Anything that we as a region can do to put pressure on Ministers to extend the enterprise zones and to give us further opportunities for growth is welcome.

[Ian Lavery]

Having enterprise zones surrounding areas such as mine only compounds the entire problem; basically, they incentivise people to stay away. May I appeal to Ministers, on behalf of the young and the old? Please listen, visit the area, help the anxious communities that we represent, give them fairness and a level playing field and give them hope and access to aspiration. Although not the most wealthy people in the country, we are most honest and most sincere. We need the Minister and the Government to act now to save what might be lost future generations.

10:31

[Mr Iain Wright (Hartlepool) (Lab)]

It is a pleasure to serve under your chairmanship again, Sir Roger. I congratulate my hon. Friend the Member for Gateshead (Ian Mearns) on securing this important debate.

We in the north-east have fantastic potential to lead the country out of recession into sustainable, long-term growth. In the Budget last month, however, the Chancellor failed to help the region fulfil its potential or address its challenges. I am critical of the Chancellor not only because of what was in the Budget, in which he showed the wrong policies, the wrong values and the wrong judgments, but even more because of what he left out. He failed to use the opportunity to grasp the enormous potential of our region and, perhaps most damning of all, simply neglected to remember the north-east at all. For example, there was nothing to mitigate the effect on energy-intensive industries or to incentivise businesses and to give firms in the region or elsewhere the confidence to invest their substantial cash piles in improving the productivity of our region.

On Friday, I met dynamic, energetic and ambitious entrepreneurs in the technical, digital and creative sectors in our region, running businesses such as Stick Theory, Love Your Larder and Sherpa. They have the potential to grow, to thrive and to create job opportunities. I asked them what was the one thing they wanted from the Government. They said improvements in transport infrastructure, making it easier to get on a train, to get to London, to make contacts and win businesses. In the Red Book announcement of £130 million for the northern hub rail scheme, however, no north-eastern town or city was even mentioned, let alone had any investment.

In the time available, I want to concentrate on the biggest neglect of the lot: unemployment, which is the biggest single social and economic factor affecting my constituency. The number of claimants in Hartlepool has risen month on month and year on year to reach 4,678 in February. The number of unemployed in Hartlepool is now higher than it was at the height of the global recession, and tomorrow’s publication of the March unemployment statistics will probably see a further rise. Contained in those figures, however, there is even bleaker news. Almost one in four young men, or 23.8% of 18 to 24-year-old young men, is claiming jobseeker’s allowance. When an area hits one in four young men out of work, it has reached crisis point. We last saw such statistics for youth unemployment back in the 1980s, when my shipyards and steel works closed down. For many lads coming to adulthood in that time, theirs was a lost generation who faced no pay or low pay, benefits and illness; they failed to fulfil their potential. My town, arguably, has not really recovered from the social and economic shock of the deindustrialisation of 30 years ago, yet we are in danger of experiencing that shock again because of the neglect of the Government.

The Minister must recognise the lessons of history and ensure that young people are helped into work and training. It is economically ignorant to suggest that public sector jobs are crowding out private sector employment and growth, and that the best approach is to cut drastically public sector employment. It is economically illiterate to believe that a region’s employment and growth prospects will somehow bloom if spending, resources and demand are withdrawn quickly, or will be helped if regional pay bargaining strips out regional income. The Chancellor had a perfect opportunity to do something in his Budget to encourage employment, especially for the young. Instead, he chose to provide tax cuts for millionaires. Despite the importance of youth unemployment, the Red Book contained only one, single, derisory new announcement—complete with spelling mistake—about such a huge social and economic issue. The announcement that the Government

“will pilot the best way to introduce a programme of enterprise loans to help young people”

is patronising, smacks of gimmick and gesture politics and will do nothing to stop a lost generation of young people. I ask the Minister to think again.

10:35

[Mrs Sharon Hodgson (Washington and Sunderland West) (Lab)]

It is a pleasure to serve under your chairmanship this morning, Sir Roger. I add my congratulations to my hon. Friend the Member for Gateshead (Ian Mearns) on securing this important debate.

I hope that the Minister has brushed up on the geography of our region and where the north-east covers—the Government sometimes struggle with that. I will not repeat what the Minister has said, but other examples make interesting reading in Hansard. I am sure that the Minister will want to talk in her response about the recent good news of Nissan’s success. Nissan is in my constituency, and I am personally very happy about its fantastic success. The announcement was a great vote of confidence in the local work force in particular, as well as a reflection of all the hard work and sustained relationship-building with Nissan by Sunderland council over the past couple of decades.

A few other welcome gems of news in my constituency include the recent announcements by Calsonic Kansei and Rayovac. However, all those new jobs and pockets of investment in the north-east are not enough to mitigate the effects on tens of thousands of people of losing their jobs in the public sector and elsewhere in the private sector, or the reality of long-term youth unemployment in my constituency, which is up by 188%.

I want to focus my remarks on household budgets and family finances. At the start of this month, an estimated 1,400 households in my constituency were no longer eligible for child tax credits worth £545 a year. A further 355 households will lose their working tax credits, worth £3,870 a year, unless they find a way to increase their working hours by at least eight hours. Throughout the north-east, such changes will affect just short of 50,000 households—so that is 50,000 households having their budgets squeezed, spending less in local shops, pubs, restaurants and other businesses and with less money to have days out, if any, at local attractions. The Institute for Fiscal Studies estimates that families with children will, on average, be £511 a year worse off, and that includes the token amount given back to them by increasing their personal allowances. Some parents may find, therefore, that they are better off not in work than taking up work if it does not make financial sense. What is the sense in policies that push people out of jobs?

We have yet to see the full impact of the changes, but no one believes it will be positive—certainly not our pensioners, who have worked hard and saved throughout their working lives to provide a modest pension for themselves in later life. They will be hit by the freezing of age-related allowances, the worst affected being those who retire next year. In total, Treasury figures state that the changes will take more than £3 billion out of pensioners’ pockets—again, £3 billion that will not be spent in local economies such as Sunderland’s. At the other end of the scale, however, those on more than £150,000 a year will get a tax cut; unfortunately, not many of them live in my constituency.

We needed a genuine plan for growth and real help for families; we did not get it. What we got was worse than nothing. We got measures that will deepen the north-south divide and, as usual, the lives of my constituents will suffer at the hands of this out-of-touch Tory-led Government. Has it not always been so?

10:39

[Mr Stephen Hepburn (Jarrow) (Lab)]

This Budget has been drawn up by a Chancellor with no perception or idea of what it is like to live in the north-east of England, and to have to live on a day-to-day basis. On one hand, the Budget cuts the wages and pensions of people in the north-east, and cuts their public services; on the other hand, it turns round and gives a tax cut to the richest 1% of people in this country. It is a Budget that will condemn thousands of families in the north-east to poverty, while it makes a priority of giving tax cuts to business by way of corporation tax cuts. It is a Budget built not on fairness, but on privilege.

This is not the Budget that we wanted for the north-east. We wanted a Budget for growth, to create jobs and the necessary economic activity to make the north-east alive again. Instead, we have a Budget that lines the pockets of the rich by cutting income tax and corporation tax. The Government say that they have changed tax thresholds, and that people will be better off, but that is more than compensated for by the cuts in tax credits and benefits, the scanty increase in the minimum wage, and the increasing cost of travel and utility bills for people in the north-east.

The move to regional pay will be a disaster. As the Secretary of State for Business, Innovation and Skills said, it will stigmatise the north-east as a region of failure. It must not be allowed to go ahead. The Government justify the regional pay policy on the basis that public sector pay hurts the private sector and curtails job creation. What nonsense. How come we live in a region with the lowest wages in the country, yet we still have the highest unemployment, with nine people chasing every job vacancy? It is nonsense.

[Mrs Jenny Chapman (Darlington) (Lab)]

My hon. Friend is making a very good point about regional pay, but the situation is worse than he indicates because up to £1 billion could be taken out of the north-east economy, which would hit all sectors of industry in the north-east, particularly the service sector, cultural industries and retail.

[Mr Hepburn]

My hon. Friend makes a very good point. It is not just the pay of teachers and nurses that affects job growth in the north-east; it is lack of demand. The point that she rightly makes is that every 1% taken out of regional pay in the form of public sector pay cuts sucks an extra £80 million from the north-east economy, causing a spiral down and down.

I am pleased that the Budget is already beginning to implode daily, because people are catching on to the fact that because of tax cuts for the richest in society, charities will receive less, pensioners will receive less, and Greggs pasty eaters will have to pay more. The Budget will not help the people of the north-east. It is a Budget of the privileged, by the privileged, for the privileged. If we really are all in this together as a society, surely it is right that the better-off pay a little more and take the burden off working-class people in the north-east.

10:43

[Chris Leslie (Nottingham East) (Lab/Co-op)]

This has been an excellent debate, thanks to my hon. Friend the Member for Gateshead (Ian Mearns), and we are left with one question, which was asked not just by my hon. Friend the Member for Jarrow (Mr Hepburn), but by most contributors. Will the Minister dare to have the audacity to utter the phrase, “We’re all in it together”? I hope that she will. I want to give her ample time to respond to the debate, because so many points have been well made, including the impact on families with children and on single individuals, and the statistic that the typical family with children will be £511 worse off annually as a result of cumulative Budget measures. When people open their pay packets at the end of this month, they will see the impact not just of VAT, but the tax credit changes that will also hit working people exceptionally hard.

People are shocked at seeing a Government hit elderly people and pensioners by freezing age-related allowances and using that money to give a tax cut to the wealthiest in society. Those earning more than £150,000 and typical millionaires—if there is such a thing as a typical millionaire—will receive a £40,000 tax benefit. That is astonishing. Is it any wonder that the Government’s fortunes are plummeting? What is even worse—as my hon. Friends the Members for Sedgefield (Phil Wilson), for Jarrow, and for Washington and Sunderland West (Mrs Hodgson) mentioned—is that there is no action of any substance in the Budget to tackle the crisis in jobs and growth. That is at the core of the issues.

The Government have taken a wrecking ball to institutions in the north-east that existed to try to help the economy, whether it was a Minister for the north, the regional development agency, or local authorities whose grants have been slashed disproportionately in the north-east compared with other parts of the country.

[Roberta Blackman-Woods (City of Durham) (Lab)]

Does my hon. Friend agree that the lack of a growth strategy for the north-east is a complete travesty? Getting rid of the RDA and replacing it with LEPs and enterprise zones, fragmenting the whole support system, is not working. The Government are leaving the north-east without the support that it needs to keep regenerating itself.

[Chris Leslie]

The jobs crisis worries people, and all contributors today have talked about that, including my hon. Friends the Members for North West Durham (Pat Glass), for Hartlepool (Mr Wright) and for Wansbeck (Ian Lavery). The statistics that 22 people apply for every vacancy, and that youth unemployment in the north-east is rising by 155% are shocking. The Minister must react to that crisis.

[Ian Lavery]

What does my hon. Friend think about the fact that the Minister of State, Department for Work and Pensions, the right hon. Member for Epsom and Ewell (Chris Grayling) refused to meet me to discuss the severe problems facing unemployed people in my district, saying that it was inappropriate at this point?

[Chris Leslie]

I have heard of similar cases. What sort of Minister refuses even to discuss such issues, and turns a blind eye to the problems? A pointless Minister, so what is the point of having that individual in that post.

Many issues have been raised—too many to mention. My hon. Friend the Member for Gateshead and others referred to the case for investment and infrastructure. There is the impact on the so-called big society, with major charitable trusts and others losing out. The Chancellor is taking away from them while staff who are being made redundant from Alcan and elsewhere have dug into their own pockets for their works welfare fund donations to local charities. Their example contrasts so much with that of the Chancellor of the Exchequer.

Greggs was founded on Tyneside in 1939, and if ever a part of the country should be astonished at the Chancellor’s move to extend VAT, it is the north-east. The hon. Member for Redcar (Ian Swales) referred to the temperature of his sausage roll, and he will have the opportunity to vote on the matter in the House this week. We hope that he will join us in the Lobby.

I do not want to take up any more time, because we want to hear from the Minister. She should listen to these exceptionally powerful voices from the north-east. People know what they are talking about. She should recognise the warning signs for jobs and growth, and change course now before it is too late.

10:48

[The Economic Secretary to the Treasury (Miss Chloe Smith)]

This has been an interesting debate, and I thank hon. Members for their contributions, whether in a constricted four-minute speech or an intervention. The hon. Member for Gateshead (Ian Mearns) spoke with great passion about his constituency and the broader region, and I hope in the time available to address some of his concerns and those of other hon. Members. With a smile on my face, that gives me a chance to place on the record the apology that I have already given to the hon. Member for Bolton North East (Mr Crausby) for having mistaken his constituency on the Floor of the House last month.

[Roberta Blackman-Woods]

Will the Minister say whether she has visited the north-east to look at the impact of the dreadful Budget on that area, and to refresh her geography at the same time? Perhaps more significantly, has she asked her officials to look at the impact of the Budget on the north-east, and to come up with measures that will support growth in the region?

[Miss Smith]

If the hon. Lady had let me press on, she would have heard the answer to much of what she asks a little sooner. Let me reassure her that I have often visited the north-east, although not since the Budget, so I look forward to a chance to do that, perhaps in the next recess. As many Members have said, it is a fine region and a great place that we should all seek to support.

Let me return to the matter in hand. In the Budget, the Government made it clear that they have three priorities: first, the creation of a stable economy; secondly, a fairer, more efficient and simpler tax system; and thirdly, reforms to support growth. The 2012 Budget, together with the national infrastructure plan that we published in last year’s autumn statement, set out the Government’s latest steps towards achieving those priorities, based on a model of sustainable and balanced growth, including, of course, in the north-east.

As hon. Members have made clear, the north-east faces difficult challenges. It remains, however, a significant contributor to the national economy, and I would like to reiterate and highlight the numerous good news stories that have been mentioned and involve companies that are already investing in the north-east and creating jobs for people in the area. For example, the Japanese automotive company Vantec has created 230 new jobs and secured 800 existing posts in Sunderland. Nissan has announced the creation of 225 jobs at its Sunderland factory and 900 more with its British suppliers. Both companies have been pledged money from the regional growth fund, which illustrates the difference that that initiative makes on the ground. I join other hon. Members in celebrating the relighting of the blast furnace at the SSI Redcar steelworks, which my hon. Friend the Member for Redcar (Ian Swales) mentioned earlier in the debate.

The reforms set out in the Budget will give businesses and individuals in the region a further boost on top of those private sector initiatives. Corporation tax will be cut by an additional 1% on top of the cuts announced last year. From April this year, the rate of tax will be reduced to 24%, and it will ultimately fall to 22% by 2014—a competitive rate when we consider our competitors around the globe. Let me reiterate that the Budget increases the personal tax allowance by £1,100, which will take 34,000 people in the north-east out of tax altogether. It also increases the Growing Places fund, which will provide additional funding for the infrastructure that is needed to unlock developments that lead to jobs and growth. Local enterprise partnerships in the north-east will receive a further £11 million.

I also confirm that Newcastle has been selected to become a super-connected city. I do not sneer at that; hon. Members may fail to welcome it, but the city will receive up to £6 million of funding to deliver ultra-fast broadband to residents and businesses, which is valuable. On top of that, the Budget includes investment of almost £28 million in stalled development projects within the north-east.

Hon. Members were keen to talk about capital spending in percentage terms, but let me provide some absolute terms and mention £4.5 billion for the intercity express programme; £260 million for the new Tyne tunnel; £57 million for the Tees valley bus network; £350 million to reinvigorate the Tyne and Wear metro; and £82.5 million for a new Sunderland bridge, which perhaps hon. Members will welcome.

[Grahame M. Morris]

I am grateful to the Minister for giving way as I know that time is short. However, she is reading out a list of projects that have already been delivered and were planned by the previous Government. Can she equate the £10 million in the Growing Places fund to a distance of new motorway, for example? Would it buy one, two or three miles of new motorway? We are talking about relatively modest sums of new money.

[Miss Smith]

I am afraid that my mental arithmetic does not extend to working out pounds per mile on the spot, but I will be happy to look into the hon. Gentleman’s question.

I will continue with my comments, which I hope will help hon. Members. I want to talk briefly about support in the Budget for individuals and families to buy new-build properties with a 5% deposit through the NewBuy scheme, and I wish to put it on record that the Budget increases the maximum right-to-buy discount—[Interruption.]

[Sir Roger Gale (in the Chair)]

Order. I am sorry to interrupt the hon. Lady. Hon. Members have participated in the debate and should do the Minister the courtesy of listening to her response.

[Miss Smith]

Thank you, Sir Roger. The new right-to-buy discount introduced by this Government is more than three times the current limit in the north-east of £22,000.

In his opening comments, the hon. Member for Gateshead used words such as “outdated”, and various other words have been bandied around today. I think that the hon. Gentleman, and other hon. Members, need to look around and see the threat to today’s economy, which in one word is debt. Debt is a problem both in the UK and globally, and this Government are determined to sort it out. Fiscal consolidation is necessary. Those in the Labour party seek to spend more, borrow more and owe more, and therefore to pile more debt on their children, and indeed my children. The hon. Gentleman, and those on the Opposition Front Bench, still believe that child benefit should be claimed by millionaires. We do not; we believe that there should be consolidation.

[Ian Mearns]

Will the Minister give way?

[Miss Smith]

I am afraid that I have no time. If we do not tackle our deficit, it will be worse for everybody. The really outdated view is to burden future generations with more debt, and for the Government to fail to take responsibility and consign all regions in the country to economic disaster. One need only look to the eurozone to get the picture. The Government’s actions have kept our interest rates closer to those in Germany than those in Greece, and made Britain a safe haven.

The topic of young people was raised by the hon. Members for North West Durham (Pat Glass) and for Hartlepool (Mr Wright). I am shocked that the hon. Gentleman thinks that it is patronising to believe that young people can start their own businesses and I disagree strongly. As a constituency MP, I make it my business to support Jobcentre Plus, the youth contract, the work experience programme and the Work programme—perhaps the hon. Gentleman acts differently in his constituency—and that is what I call working together to achieve things for our young people.

[Chris Leslie]

Will the Minister give way?

[Miss Smith]

No. I am afraid that I must move on. I know that the hon. Gentleman’s colleagues wish me to talk about regional or local pay.

[Chris Leslie]

It is a very quick question. I wish simply to ask whether the Minister will utter the words, “We’re all in it together”?

[Miss Smith]

The hon. Gentleman asks me to do that as well as to respond to other hon. Members in three minutes, but I value his Back Benchers more than he does, and I wish to talk about local pay. The hon. Member for Gateshead focused much of his contribution on that issue, and I wish to reassure him about something that he already knows. At this stage, the Government are not setting out detailed proposals; they are asking experts how public sector pay might better reflect local markets. Localising pay has the potential to improve the resources available to private sector businesses that need to compete with higher public sector wages. It can improve or reduce unfair variations in the quality of public services, and tackle a limit on the number of jobs that the public sector can maintain created by having to support disproportionate wages. The principle of local pay has already been established, and I confirm, as has been mentioned, that the Labour party did that in 2007.

I will move on briefly to pasties and the sausage rolls mentioned by the hon. Member for Redcar. The point is that the Budget closes loopholes and addresses anomalies to ensure a level playing field. The National Federation of Fish Friers states:

“There should be a level playing field. Why should the UK’s fish and chip shops have to pay 20 per cent. on all the hot food they sell…when the bakery next door sells hot pies, pasties and sausage rolls free of VAT?”

The Budget seeks to introduce that level playing field.

[Mr Anderson]

Will the Minister give way?

[Miss Smith]

I am afraid that I do not have time because I must respond to concerns about local government funding and the claim that local authorities in the north-east have taken disproportionate cuts. As I have made clear, the previous Government left an appalling economic and financial mess, and we have a moral obligation to pay back our debts as quickly as possible. Therefore, tough decisions are necessary. The hon. Member for Gateshead will know that the formula grant in his area will be nearly £555 per person in 2011-12, compared with an average of £372 across England. That reflects the higher level of need in Gateshead, and I expect him to welcome that. In the light of issues raised by hon. Members, the Government’s key priority is returning the UK economy to sustainable, economic growth.

Before time runs out, I want to talk about local enterprise partnerships. Such partnerships have radically reshaped the way businesses and the Government interact at local level, and they mark a sharp break from the top-down, politically driven regional policy of the previous Government. The winners of the first two rounds of the regional growth fund are expected to create over 13,500 direct jobs and 25,000 indirect jobs in the north-east, including at Gateshead college in the hon. Gentleman’s constituency. The Government are taking forward an ambitious work programme that will assist with city deals for core regions, and I encourage all hon. Members present to engage with that.

[Sir Roger Gale (in the Chair)]

Order. Will hon. Gentlemen and Ladies who participated in the last debate and are leaving please do so quietly? As they are doing so, I thank everyone for their courtesy and patience this morning, which has allowed every hon. Member to have at least some say.

Rural Communities

Tuesday 17th April 2012 Westminster Hall

11:00

[Sir Roger Gale (in the Chair)]

We now come to the next debate. Hon. Members who were not present for the previous debate will be unaware that the Chairman of Ways and Means has granted me the power to impose time limits on speeches. I notice that a significant number of hon. Members are present for the debate. Seven have already indicated to Mr Speaker that they want to participate, and others who have not written in may well want to contribute. I will therefore say now that I am imposing a six-minute time limit on all speeches, other than of course the speech of the hon. Member introducing the debate. That will carry with it a penalty of one minute per intervention for the first two interventions. Hon. Members can do the maths and work out how many of their colleagues are likely to be able to participate in the debate on that basis. It will be the intention of my successor in the Chair to start to call those on the Front Benches for the winding-up speeches not less than 25 minutes before the end of the debate.

11:01

[Simon Hart (Carmarthen West and South Pembrokeshire) (Con)]

Thank you, Sir Roger. I will keep my comments as brief as I can, given what you have told us. I begin the debate by thanking a number of organisations for making contributions that have been very useful not only to me, but to other colleagues—in particular, the National Farmers Union, the Federation of Small Businesses, the Countryside Alliance, the Dispensing Doctors Association and BT.

We have been told that the election in 2015 will be fought largely on urban ground, but I hope that in these opening remarks, I can persuade my hon. Friend the Minister that although we might be small in number in rural areas, we are certainly large in political significance. These days, 20% of the population either live or work in rural areas.

As good Conservatives and, I suspect, good Liberal Democrats, we are always pretty sceptical about the concept of an urban-rural divide, just as we are sceptical about a north-south divide. As good Conservatives, good Liberal Democrats and, as the shadow Minister, the hon. Member for Ogmore (Huw Irranca-Davies), would no doubt claim, good socialists, we embrace cultures and traditions—[Interruption.] He is objecting to being described as a socialist, I suspect. Even some of the more quirky and weird traditions, we welcome and embrace and, hopefully, champion.

However, although rural isolation is a dream or an aspiration for some people, it is unquestionably a challenge or even a nightmare for others. I say that because the challenges facing rural communities are often the same as those facing urban communities; they just emerge in a slightly different way. Those challenges include deprivation, poverty—particularly fuel poverty, which I know other hon. Members want to touch on—the perhaps more limited choice of educational opportunities in rural areas and the cost of fuel, particularly as that applies to medical needs or basic provisions. Let us not forget that rural fuel can be up to 5p a litre more expensive than the fuel that people can buy in urban areas.

There are also challenges in relation to the availability of rural transport and affordable housing, particularly in national parks. I know that one or two hon. Members are lucky enough to live in or near very beautiful parts of Britain. Not surprisingly, the house prices in those areas are much higher and therefore much further out of reach of those who perhaps were born and bred there and want to remain there for the purposes of their job or family life. The availability of health care is often much more of a challenge in rural areas than it is in urban areas, and the fear of crime—not necessarily crime itself, because the incidence of crime is lower in rural areas—is higher, particularly among elderly people. The last challenge is access to financial services. That is a given if people are lucky enough to live in an urban area, but can become and is increasingly becoming a nightmare for people in rural areas. About 300,000 people in rural England do not even have access to a bank account.

There are also challenges for businesses in rural areas. We can take my own constituency of Carmarthen West and South Pembrokeshire as an example. Someone might want to make relatively minor modifications—minute improvements—to the infrastructure of their factory or depot. They might want to engage in some rather limited activity. However, if they are in a national park or another sensitive area, they have to prepare themselves for a long and expensive fight with the local planning authority, which in so many cases has as its default setting “You must be joking,” rather than “How can we help your business?”

In some places, if people want to compete with their European colleagues by means of an internet-based business, they can forget it. The same is true in relation to mobile phone coverage. I remember my hon. Friend the Member for Penrith and The Border (Rory Stewart) mentioning that mobile phone coverage was better in Uzbekistan than in Cumbria. That is ludicrous. As I think I have mentioned in this Chamber before, I cannot talk to hon. Friends in adjacent constituencies because I cannot get mobile phone reception in west Wales. That is a ludicrous disadvantage, and we suffer because of it.

If a company is, as many companies are, a haulage-based business located in rural areas, often around the ports on the coast of England and Wales, what can it do about its overheads when its only two overheads are fuel and people? When it comes to its lorry fleet, what can it do to address the costs that current fuel prices are imposing on those important businesses?

This is an opportunity for the Minister to lay out the Government’s achievements—that will probably include the achievements of Departments other than his own, because this debate is deliberately wide ranging—and to ask himself, as we have asked ourselves, this question. Is rural patience being stretched at the moment? The Government have done well on broadband, food labelling, red tape in farming, and planning, certainly in England—not as yet in Wales, regrettably, thanks to the Welsh Government. I think that, in time, the Government will be seen to have done well on health and health provision, too. However, the rural jury is still out on affordable housing, post offices, mobile phone coverage, fear of crime and, more recently, on VAT on caravans, fuel poverty and transport costs as well. It is therefore not necessarily a rosy picture of Government enthusiasts in rural areas, but they are there for the picking.

[Mr James Gray (North Wiltshire) (Con)]

My hon. Friend is giving us a most interesting tour d’horizon of problems in rural areas. None the less, he has not touched for the moment on one important area—local government finance. Does he agree that the Government’s forthcoming review of local government finance across England should enable us to change the situation—to correct the anomaly whereby the Government spend about £200 per head in rural areas and about £400 per head in urban areas? Surely that is wrong and the forthcoming review of local government finance and, incidentally, of health finance as well should correct that anomaly.

[Simon Hart]

My hon. Friend is spot-on. He also highlights some of the difficulties that arise from the definitions of rural and urban. In the past, not just the previous Government but probably the Government before them struggled to get a proper definition that enables that anomaly to be ironed out.

We probably all agree, on both sides of the House, that rural people are entrepreneurial, innovative and, above all, patient. They feel that they perform well despite government, rather than because of it. That does not necessarily apply specifically to the current Government. It is just a general feeling on the part of rural people that they have the skill and determination to overcome the obstacles that sometimes the Government inadvertently put in their path.

Rural people are unquestionably the key to economic regeneration and job creation in rural areas. There is the statistic, which some people might say is trite, that if every small or medium-sized enterprise in Wales hired just one person, there would be no unemployment in Wales at all. That is the raw statistic. Of course it is simplistic, but we are not talking about anything that is out of the reach of most people who have aspirations for their business. Such people epitomise the strivers politicians from all quarters always talk about. We refer to them as if they were our friends. They are the people who are there to bring the country out of recession, and that, indeed, is what they are doing. Sometimes, however, I question whether we quite recognise the additional challenges people in rural areas face in running their businesses.

As the shadow Minister will recall, we used to accuse Labour of doing things to, rather than for, the countryside. That is the nub of my opening remarks, from which my questions arise. I hope the Minister will be able to describe to us how he will be part of a re-energisation of rural communities. I hope he will remind rural communities not only of the fact that the Government are on their side, but of how they are on their side.

I hope the Minister will also be able to tell us about the Government’s plans for broadband and mobile phone coverage in not only rural areas, but isolated rural areas. If the Government’s plans for 95% of the country go ahead, as I hope they will, the few people left in the furthest retreats of rural Britain—the other 5%—will, through a fairly obvious logic, be put at a further disadvantage.

[Andrew Bingham (High Peak) (Con)]

My hon. Friend makes a fabulous point for rural communities. I view broadband as the fourth utility nowadays. Does he agree that companies will start to go back to urban areas unless we get broadband right? That would further exacerbate the difficulties rural communities face in surviving.

[Simon Hart]

My hon. Friend makes a good point well. The struggle to compete with their urban neighbours has already put that question in the minds of some companies and organisations. What a tragedy it would be if the things my hon. Friend talks about happened. That would go against every one of the principles of not only the Conservative party, but the Liberal Democrats and Labour, too. We should not go down that road.

I hope the Minister will set out the real prospects for fuel costs. I hope he will not say what various people who send us briefs from time to time tell us—that fuel would have been more expensive under Labour. That argument does not work in west Wales or, I suspect, anywhere else. We will start convincing fuel and transport-dependent rural businesses that we take their plight seriously only when the price of fuel comes down. I am not going to say to businesses in my area, “I don’t know what you’re complaining about. It would have been much worse had there been another Government.” Let us not deploy that argument; it does not work, it is disingenuous and it is disrespectful to companies worried about whether they can get through to the end of next month, let alone the end of next year.

I hope the Minister can persuade us that young families will be able to afford to buy a house in the area they wish to work in, the area they were born and brought up in or the area they want to stay in and continue to make a contribution in. Perhaps he can tell us how they will be able to do that.

[John Howell (Henley) (Con)]

Will my hon. Friend pay tribute to, and comment on, the opportunities rural communities have under the community right to build scheme to become developers? Small developments can help the affordable housing situation in villages, but many small villages have been prevented from undertaking any development in the past.

[Simon Hart]

That proposal is welcome. In some areas, of course, it has been subject to bigger planning obstacles than predicted, notwithstanding the improvements that have been made to the planning process, certainly in England. If my community is anything to go by—this is particularly true in the national park, although I do not want to get personal about the national park—even small developers have to pay a significant sum, almost by way of a hidden tax, to undertake such development, and that is a disincentive. I fully recognise my hon. Friend’s positive message, but there are some negative ones, too, and we need to address them if such proposals are to be universally fair.

[Mr Mark Spencer (Sherwood) (Con)]

Does my hon. Friend recognise that there is a fundamental need to distinguish between protecting and preserving the countryside, which are two different things? To protect the countryside, we need development and change so that communities can expand and look after their schools and shops.

[Simon Hart]

I wish I had thought of that myself because it is such an important point. We are sometimes distracted by the preservation argument, but the countryside is actually all about people, jobs and communities, and the landscape, which we are sometimes fixated by, is only a consequence of the tender stewardship of generations of dedicated enthusiasts of the rural big society. My hon. Friend is right to point out that unless we have the conditions and facilities to encourage that, everything else we, the nation and our foreign visitors admire about the countryside will be compromised.

My next question for the Minister—it is not a sarcastic question—is which bits of the recent Budget does he believe give hope and encouragement to businesses in rural areas? Which bits remind them that they should welcome life under the coalition and let them see some sort of vision arising out of the Chancellor’s recent comments?

In drawing to a conclusion, I want to refer to the views of voters and constituents in west Wales. I do not know whether I am unique in this respect, but voters in my area do not really give a damn where the Prime Minister went to school. They have no interest whatever in who he might or might not have to dinner, and they certainly have no interest in what might or might not be on his tax return. All they want to know is whether the Government are bold, trustworthy and competent, and whether the Government’s values are the same as theirs. Those are the things I get asked about—not all the other fluff and nonsense that floats around this place from time to time—and they probably reflect the views of rural, and indeed urban, people across Britain.

In my short opening remarks, I hope I have been able to provide an absolutely open goal for the Minister to aim at. I hope he can convince us that we can continue proudly to defend the reputation of the Conservative party as the party of the countryside.

[Several hon. Members]

rose—

[Sir Roger Gale (in the Chair)]

Order. The reason for the slight pause is that I was looking to see who had risen to speak. [Interruption.] Okay, please sit down. Ten Members are seeking to speak, and others may seek to intervene. That being so, and despite the fact that I announced at the start of the debate that I wanted to curtail speeches to six minutes, I will actually curtail them to five minutes. That will allow the Front-Bench spokesmen to start at about 12.5 pm. It will also allow a little injury time for interventions. For those who came in slightly late, let me explain that the system is exactly as it is in the main Chamber. For each of the first two interventions, there will be an extra minute, so a five-minute speech could turn into a seven-minute speech. We do not have the same advanced technology as we do in the main Chamber, so I will indicate when Members have one minute left to go by ringing the bell in front of me.

11:17

[Hywel Williams (Arfon) (PC)]

I will be brief, as you requested, Sir Roger.

This is a very worthy and great subject for debate, but we have not debated it often enough. Had there been time, I would have talked about a large number of issues, including fuel, taxation, transportation, post offices, broadband and much else. I will, however, confine myself to two issues that are particularly important to my constituents and, indeed, to constituents elsewhere in north Wales: health care and unfit housing.

I am glad the hon. Member for Carmarthen West and South Pembrokeshire (Simon Hart) has raised this issue, and I warmly congratulate him on securing the debate. He has a fine record in Wales and, indeed, throughout the UK, on standing up for rural communities, and he is to be praised for that.

As I said, a couple of issues are particularly important in my constituency. The first is health care, which is very problematic. Some hon. Members might wonder why I, as a Welsh Member, am raising the issue of health, given that it is devolved. During the recent debate on health, however, sufficient attention was not given to the fact that many people in north Wales and mid-Wales access treatment on the other side of the border. I have raised the issue with Health Ministers over the past few weeks, but I am unsatisfied by their response. I have also raised it with the Secretary of State for Wales, who had a better understanding of it, but I still do not think it has been tackled properly.

The issue of health impacts on people in rural areas. Most of north Wales, and particularly north-west Wales, is rural. People from north-west Wales travel two and, sometimes, three hours just to access specialist treatment. Most of us will have had briefings on the debate, with references, for example, to an ambulance response time of just a few minutes. The reality in the area I represent is travel of two or three hours. I had a response from the Minister suggesting that we need to think of the issue as a problem of people registering with GPs just the other side of the border; but it is a great deal more than that. I ask him to bear that in mind. He will have a great many points to respond to, but I wish that the Government would take the matter more seriously. I see that the hon. Member for Ogmore (Huw Irranca-Davies) will speak for the Opposition, and I wish that the Welsh Labour Government would take the matter more seriously too.

[Nic Dakin (Scunthorpe) (Lab)]

I congratulate the hon. Member for Carmarthen West and South Pembrokeshire (Simon Hart) on securing the debate. Before leaving the question of health, does the hon. Member for Arfon (Hywel Williams) agree with me on the importance of dispensing doctors practices in rural communities? They are particularly important for getting treatments to elderly and infirm people in rural communities such as the towns and villages south of Scunthorpe, which are served by the Riverside practice in my area. That is an important part of health care provision in rural areas.

[Hywel Williams]

Briefly, there are GP surgeries in my area that dispense, and that has been a vital part of the service to the population. It does not take two or three hours to travel to a pharmacy, but it is highly inconvenient, especially when bus services are so patchy.

I want to refer to housing, and to mention that we have many unfit houses in Wales. However, the repair and renovation of housing is subject to VAT, and I think that that is wrong. VAT is charged on repair and renovation, but it is not charged in the same way on new build. Plaid Cymru has repeatedly called for a tax cut. It might surprise some hon. Members to hear that a usually left-of-centre party has called for tax cuts, but that is a particularly useful one. It is a matter of equality between people, such as a young couple renovating their first house—adding a kitchen and bathroom to the back of a pre-1919 terraced house, and being charged VAT for it—and someone retiring, say, from the City to the home counties, and building a retirement home, free of VAT.

[Mr Gray]

Does the hon. Gentleman agree that some particularly unfortunate small print in the Budget was about VAT on the restoration of historic churches and houses? Because of that, it will be necessary to do away with the restoration of the church at Castle Combe in my constituency.

[Hywel Williams]

The hon. Gentleman makes a fine point. I had a hugely confusing conversation with the Welsh Government, some time ago, about historic and listed buildings being free of VAT. The conclusion, after 20 minutes of discussion, was agreement that they were free of VAT—but only for new build. Given that we were talking about historic and listed properties, the idea of building them anew seemed somewhat peculiar to me, to say the least.

I will conclude by saying that we have social housing in Wales, as elsewhere. Social housing is extremely valuable, but often it is of the wrong type, and in the wrong place. The ability of social landlords and local authorities to let houses in rural areas has been severely curtailed. In many villages in my area, social housing has been sold. It is not available. The proposed changes in housing benefit are unlikely to help. More people under 35 will be looking for houses in multiple occupation, of which we have few in rural Wales.

[Sir Roger Gale (in the Chair)]

Order. Before we proceed, I now have a fairly definitive list of hon. Members who have applied to speak. Although it is exceptional to do so, it may help if I give the names of those people, so that hon. Members not on the list may consider whether to intervene. From the Government Benches, in the order of application, speakers will be Mr Rory Stewart, Caroline Nokes, Sheryll Murray, Glyn Davies, Roger Williams and Neil Parish; and now that Mr Hywel Williams has spoken the only name I have from the Opposition Benches is Mr Ian Paisley. Any hon. Member not on the list has not so far indicated a wish to speak.

11:24

[Rory Stewart (Penrith and The Border) (Con)]

I join everyone in congratulating my hon. Friend the Member for Carmarthen West and South Pembrokeshire (Simon Hart) on securing this important debate. The enormous number of people here is testimony to the importance of the subject.

Speaking on behalf of Cumbria, I want to say that we need to recognise, when we talk about Government support for rural areas, that there is already significant Government support for them. We cannot start the debate pretending that rural areas are somehow entirely neglected or forgotten. It is correct that there should be Government support for them, but we should recognise that in per capita terms—and of course, it is driven by our need—Government support can be considerable. In our part of Cumbria, for example, we run two district hospitals for a population of 300,000 people. We have the smallest high school and the smallest sixth form in England. That means that the per capita costs of running those services are high. That is a form of cross-subsidy from other parts of the country.

Therefore, we should not over-push the argument. We should not stand up again and again in the House of Commons and present ourselves as victims. To do so is dangerous. If we present ourselves as victims and demand more and more transfer payments, and start to take on board the arguments about productivity and the connection between rural areas and the City of London, for example, we will create unpleasant tensions. We will end up with people in London saying “Why should we subsidise rural areas?” We do not want to get into that conversation. We will, in short, find that we are having the same conversation that we are now having with Scotland, which has become poisoned by the question of how much money is moving north of the border, and how much is moving south.

Nor should rural areas try to imitate cities. One of the most dangerous things that we have been doing in Cumbria has been to pursue industrialisation policies that are entirely unsuitable for rural areas. Of course it is true, as my hon. Friend the Member for Sherwood (Mr Spencer) said, that we need to be sure that the economy flourishes in rural areas. However, that does not mean going into an area such as Penrith and The Border, where currently we have close to full employment, and building businesses for which we have no workers, shipping them in from other parts of the country, then saying we have a housing shortage and building another 400 houses, and then saying we do not have jobs for the people in those 400 houses, and building more businesses. That may be convenient for district councils that could generate money from that kind of operation, but it is not what is demanded by our area, our population, or our economy.

Instead, we need to look at the country as a single complementary unit—complementary in the sense that city and rural needs are different, but also in the sense that we are one community, one country and one nation. We are not about transfer payments. We cannot allow people in London to see themselves as some city state that is paying for the rest of the country. We must understand that our contribution is valuable.

[Gloria De Piero (Ashfield) (Lab)]

I suspect that many people in London would, however, be surprised to find out that in rural areas such as mine people cannot get a school bus. I am thinking specifically of the 7.55 am bus from Sutton in Ashfield to Tibshelf, which has been removed, throwing mums’ lives into chaos. Would the hon. Gentleman agree that getting a school bus is not just desirable but essential?

[Rory Stewart]

Absolutely, and I thank the hon. Lady for raising that point.

With the caveat that we do not want to present ourselves as victims, it is essential to demand the basic services that other people in the country take for granted. Those could be buses, or access to hospitals or schools.

[Andrew Bridgen (North West Leicestershire) (Con)]

I am so pleased that my hon. Friend is happy with the funding of education in Cumbria. As a Leicestershire MP I am not happy with the funding settlement for Leicestershire, which is the lowest-funded county, per capita, in the whole of Great Britain. We are in the bizarre situation, with no indication of any movement by the Government to repair the damage, in which the education of every pupil in the city of Leicester is valued at a stunning £800 a year more than that of every pupil in Leicestershire. That is untenable and cannot be perpetuated. To say that is not to plead poverty: there is a clear disparity between the education funding for rural areas such as Leicestershire and that for cities.

[Rory Stewart]

I am certainly not going to stand up in the House of Commons and say that I am happy with Government funding for education in Cumbria. There is not a single person in this Chamber who would say that they feel happy with the funding for their local area, but we need to strike a balance that is sustainable for the nation. There are two things that we need to do. Instead of focusing on money we should consider what the Government can provide—above all, I am thinking about infrastructure and getting the broadband in the ground and sufficient mobile coverage—and we must understand that Government could provide a lot more for rural areas if they gave space to rural communities to fill in the gaps. In our case, for example, the first responders enormously help the ambulance service, but they are not allowed to deal with children, which takes out a whole chunk of the population who could be served by volunteers within our communities.

In relation to our air ambulance service, the Government could do an enormous amount by exempting VAT on fuel. However, in relation to broadband, which is the most exciting area of all, it is about assigning responsibility. It is about the Government saying to communities, “This is what you ought to do and this is what the Government will not do.”

We should see rural communities not as victims but as the vanguard of Britain; as miraculous places that produce things that other parts of the country do not. In Cumbria, we have a magic alchemy that turns wet grass into productive protein, which we can sell around the world. If we get the broadband right, small and medium-sized enterprises from rural communities can challenge the rest of the world, but that involves education, focus and confidence. Importantly, we can provide an image for the 21st century on how to live in rural areas, and we no longer need to present ourselves as victims.

11:31

[Ian Paisley (North Antrim) (DUP)]

It is a pleasure to serve under your chairmanship, Sir Roger. I congratulate the hon. Member for Carmarthen West and South Pembrokeshire (Simon Hart) on securing this debate. We should celebrate the fact that this Parliament has been more rural centric in its attitude than previous Parliaments for a long period of time. Parliament is now starting to speak up for the countryside, which possibly reflects the fact that we are lobbied strongly by our countryside constituents who want a fair crack of the whip and that is something that should be encouraged. There needs to be a voice rising from the countryside for a vibrant, healthy agricultural industry, from the farmer, to the processer, to the consumer. That is what our countryside should be all about. We need policies that sustain our agricultural industry so that our living, breathing rural communities continue to contribute the most important thing—sustainable food produce.

My own constituency in Northern Ireland has an agricultural economy that employs some 20% of our workers. As the hon. Member for Penrith and The Border (Rory Stewart) mentioned, we must move away from the public sector and towards a more balanced economy. That is happening; agricultural productivity is growing, which is positive, but it can only be sustained if this place starts to put in place some very strong policies to keep young people on our land; to encourage young farmers to stay in the industry; and to ensure that the key area increases in pillar two of the common agricultural policy should not be at the direct expense of pillar one, which supports agricultural productivity. Supporting agricultural productivity is the most important thing that can be achieved by EU and CAP policies. What the Westminster Government should be doing is putting money where it matters most to assist the farmer to produce sustainable, good, traceable food which is what our consumers want and need. That is the critical issue that out rural policies should be driving at.

However, this debate is more about rural communities and remoteness. I represent a constituency that also includes the inhabited island of Rathlin.

[Jim Shannon (Strangford) (DUP)]

I thank my hon. Friend for giving way and I congratulate the hon. Member for Carmarthen West and South Pembrokeshire (Simon Hart) on bringing this matter forward. It is a really good issue and we are all supportive of it. My hon. Friend mentions the island of Rathlin and has also talked about agriculture. Sometimes a poor relation in rural communities is the fishing industry. Does he think that the fishing industry needs help from Government, and that the fishing villages initiative is one way of getting money to those communities? It is important to create jobs at this critical time.

[Ian Paisley]

Absolutely. When we talk about agricultural productivity, we must not forget our fishermen who produce a harvest from our seas and who must form part of this important debate.

Nothing could be more remote than living on an island, off an island, off an island, and that is what happens in my constituency. Those people on Rathlin know what remoteness really means. They have to travel by boat to get to their mainland in Ulster. It is critical that we address the needs of that community. When rural post offices close or a bank closes in Ballycastle or Bushmills, it has an even bigger impact on a place such as Rathlin. Whenever fuel costs go up, the knock-on effect in Rathlin is twice as big as it is on the mainland. Whenever we speak about rural communities, we must understand that there is level of remoteness that is doubly remote and we must take that on board whenever we address this issue.

Some hon. Members have mentioned broadband. Broadband does not operate appropriately in areas such as Rathlin island. A GP comes over once a week by boat to see his patients, and when he finds that the computer does not work, he cannot order the prescription from the mainland of Ulster. What happens next? Those people who are already remote feel the real sudden impact of living on that island, off an island, off an island. We must ensure that the issue of broadband is properly addressed for our rural communities because it makes a difference. It allows young entrepreneurs who live in remote areas to create businesses. It also enables our tourism industry to flourish and our community to be driven forward.

I leave one thought with the Minister: rural proofing should be a golden thread running through all policy. Whatever Department is involved, it must consider how a policy affects the people in the rural United Kingdom, because they matter most.

11:36

[Caroline Nokes (Romsey and Southampton North) (Con)]

I pay tribute to my hon. Friend the Member for Carmarthen West and South Pembrokeshire (Simon Hart) for securing this important debate. I will keep my remarks brief. In the spirit of alliteration that we saw throughout the Easter recess, I will focus on the two p’s—planning and pubs. I am a little surprised that so far we have not had any comment on rural pubs. In my constituency, village pubs close frequently. In rural areas across the country, they close at a rate of six per week. In my constituency, we have seen the phenomenon of pub companies, where a leaseholder will have several pubs, one of which might be very successful, but most of which are failing. The failing pubs are dragging down the popular, well liked village pubs. This is a classic case for the community right-to-buy policy, whereby a village can step in and rescue a critical and important asset that provides not just a place to meet and have a drink, but a number of other services such as post office facilities and cash points. Without such services, that community might be very isolated.

I spent an entire day last summer recess with a pub company, visiting various pubs across the Romsey and Southampton North constituency. It may sound like a pub crawl, but I can assure hon. Members that it was not. Representing a constituency that has both rural and urban areas, I was struck by the stark differences between the two. I saw how easy and possible it was to run a successful and thriving pub in a suburb or in a city compared with running a pub in a village, where there is a much smaller customer base. I welcome the community right to buy policy, and I hope that we will see some progress in helping to preserve pubs in my constituency in the future.

Planning, the second area on which I wish to focus, is always something of a political hot potato. What I have seen in my constituency over the past six weeks or so, certainly as the local authority produces its core strategy, is the emphasis placed by local people on having a greater say in planning and more control. Test Valley borough council was at the vanguard—this will mean nothing to most people—of policy ESN 05. The clue is in the 05. Some years ago, the council introduced a policy that allowed local communities to propose small affordable housing developments that were specifically designed for local people. People had to prove that they had a coherent link to a village, to gain access to one of the affordable homes being built there. It is an excellent policy and I am pleased to see that, through the Localism Act 2011, it is being widened and used across the country. But of course, it produces something of a conflict, because ties to local areas generally have to be very current and we have a lot of people living in our towns and on the edges of the city of Southampton who may have been forced out of the villages years ago and now have great aspirations to move back to them. There also tends to be a little bit of conflict between villages, as people who live in a nearby village will try to claim that they have a good link to a village that has introduced an affordable scheme, so there is—as ever—an enormous balancing act to be done.

The key issue that I want to highlight is that of productive land. I was pleased to hear the hon. Member for North Antrim (Ian Paisley) talk about the importance of productive agricultural land, because that issue is certainly a huge concern around the edges of Romsey, where significant farm land could be brought into agricultural use very easily and would be very productive. But of course, landowners tend to look towards the opportunities that they can gain by providing their land for future housing development.

My big plea to the Government is to ask them to consider changing the rules to make the green belt easier to establish. Currently, it is very tricky to establish what is green belt. Many people in rural Hampshire actually believe that the county has many areas of green-belt land; it does not, and there is only one small corner of green-belt land in the county. Much of the countryside in Hampshire is just deemed to be ordinary countryside, without any special designation whatsoever.

I have a final plea to the Minister. Will he please give greater consideration to the beautiful River Test, from which an enormous amount of water is abstracted, to ensure that we have enough water for the new houses that are being built?

11:41

[Sheryll Murray (South East Cornwall) (Con)]

I thank my hon. Friend the Member for Carmarthen West and South Pembrokeshire (Simon Hart) for securing this important and timely debate today. The concerns of rural communities and how the Government can best support those communities is a very broad issue. Many of my hon. Friends have already mentioned the importance of rural communities in their constituencies, and I just want to focus on a few issues that affect my constituents in South East Cornwall.

Rural transport is very important. The Commission for Rural Communities noted that rural residents placed public transport as a top priority for improving their quality of life. In my constituency, four out of five electors use their own motorised transport. Around 80% of households in South East Cornwall own a car or van, with about half of those households owning more than one vehicle. In South East Cornwall, a car is not a luxury; it is a necessity.

There is no doubt that changes in taxation and legislation relating to the car hit the person living in a rural area much harder than people in a city, who frequently have transport choice. Also, having a 4x4 vehicle in a rural area is often a necessity, particularly for farmers, but it is penalised under green taxation. We accept that the Chancellor has changed Labour’s plans to introduce heavy fuel duty, which were in its forward budget; indeed, the cost of a litre of fuel would have increased by an additional 5p under Labour. The Chancellor has delayed the extra 3p per litre increase.

[Jake Berry (Rossendale and Darwen) (Con)]

Does my hon. Friend agree that, in places such as her constituency or mine, we have a real problem with fuel price competition? Just a few miles—perhaps four or five miles—down the road from my constituency, fuel can be several pence a litre cheaper than in my constituency. I have raised that issue with large retailers, including supermarkets, but they have said that they look at a small geographical area to set the price. Does that policy not mean that we have a problem in our fuel market for rural residents?

[Sheryll Murray]

We certainly do. I happened to travel to the midlands at the weekend and the price of fuel in South East Cornwall was 10p per litre higher than in Bristol. I wrote a letter to the Chancellor last night, outlining my constituents’ worries about fuel prices. I said that I appreciated the terrible economic situation that the previous Government had left us in, and I fully understand that there is little room for manoeuvre. However, the fuel situation is getting worse and causing many of my constituents great hardship.

[Mr Mark Williams (Ceredigion) (LD)]

Has the hon. Lady reflected on the position of a lot of the smaller, independent, family-run filling stations? We are losing those stations by the hundreds every year, and in the process we often lose other valuable village facilities, such as a shop or post office, which are often incorporated in the business.

[Sheryll Murray]

The hon. Gentleman will accept that that is not a trend that has just begun under this Government. It started in the early 2000s, when we saw petrol stations in rural areas haemorrhage, which demonstrates that there was very little support for our rural communities under the last Government.

Public transport is weak in South East Cornwall; there are very few buses and there is little access to the railways. It is clear that the majority of the rural population drive, but it is also important to have some kind of alternative. Everyone has periods when they cannot drive, whether because of age, medical reasons or the car has broken down. Unlike in towns, where the local GP’s surgery can be a few hundred metres from someone’s home, in the country it can be a few miles away.

Similarly, in rural areas, train stations are often a great distance away from people’s homes and transport is needed to get to the station. So railways cannot be seen as a solution in their own right. However, we need to encourage people on to the railways and other forms of public transport. The train is often the best method for commuting to the cities, thus avoiding the congested roads that buses also travel along.

The March 2012 report, “Reforming our Railways: Putting the Customer First” said that the Government are allocating funding for additional capacity for people to commute to cities at peak times, including faster journey times, more frequent trains, more through-journeys, more reliable journeys and more cost-efficient journeys. I hope that the South West Trains franchise will make some of those improvements.

The lack of public transport and the increase in the price of fuel are major concerns for people in South East Cornwall. Wages in Cornwall are very low in relation to both the south-west as a whole and the rest of the country. In 2001, the average income per household in South East Cornwall was around £23,000. Since then, the figure has not changed significantly. Any increase in fuel prices is disproportionately felt in my constituency, as are increases to many other household bills. In my constituency, the average house price is around 10 times the average household income.

Transport is important in supporting our rural communities, and it has a knock-on effect on people’s standards of living. I am glad that the Government are committed to helping our rural poor. There are initiatives such as the Cott Yard community resource centre in St Neot in my constituency, where £330,000 was provided under the community and social enterprise, or CASE, initiative, which is a funding stream in Cornwall that was part of the rural development plan for England. That project is one such example of the Government helping rural areas. It provides rural workshops, a post office and a library run by volunteers, to deliver services in rural areas. Another such example is the fisheries local action group, or FLAG, initiative, whereby substantial funding is provided under the European fisheries fund. It has been enlarged to support coastal communities as a whole, extending out to one mile from the coast. I am really pleased that the Department for Environment, Food and Rural Affairs has introduced those initiatives, and long may they continue and be built on.

We all accept the economic legacy left by Labour’s maxing out of our credit cards, and I hope that the two examples that I have just given will be built on, so that we have faster positive changes to help our constituents living in rural areas.

[Sir Roger Gale (in the Chair)]

Order.

11:48

[Glyn Davies (Montgomeryshire) (Con)]

Thank you, Sir Roger, for calling me to speak in this debate. Yet again, it is a pleasure to serve under your respected control.

I want to take a Welsh perspective and in particular a rural Welsh perspective. Rural Wales is where I have always lived and where I always want to live, and above all else I try to represent its interests in the House of Commons. That is why I am really pleased that my hon. Friend the Member for Carmarthen West and South Pembrokeshire (Simon Hart) has secured the debate.

I have been involved in rural development for—frighteningly—about half a century, beginning with the local young farmers club. One of my proudest achievements was winning the bardic chair at a YFC eisteddfod and the speech that I made was on the future of rural Wales. The essay that I wrote advocated building a new town of 70,000 in the village of Caersws, smack in the middle of my current constituency. I would not continue to advocate that as a policy, but the underlying principle is much the same—a recognition that the traditional land-based industries in rural areas could no longer sustain a social economy. They did not employ enough people, and other forms of industry had to come in, which during the time that I have been involved have principally been manufacturing and tourism, although of course there are many others, which depend a lot on the development of broadband and on not falling behind urban areas, a point that other Members have made.

Many important issues are involved in developing these different forms of employment, but I want to talk about just two of them today, one of which, planning policy, has already been raised. We need an efficient planning services policy, and we must have attitudinal change. I was the chairman of a planning authority for about seven years, and at that time the purpose was to encourage development and do what we could to make it acceptable. Today, the position seems to be almost one of “How can we stop development?” It seems to be about making developers go through a whole series of hoops that cost them a fortune—making the process as difficult as possible. In my constituency, good projects that would provide employment are sitting in the planning department’s in-trays, and at a time when we are suffering recession and high unemployment across Britain such absolutely outrageous behaviour desperately needs to be changed.

[Mr Jim Hood in the Chair]

My other point is relevant to those of us who live near the England-Wales border. If we are to have development in rural areas, roads and efficient transport links are important. Between England and Wales there are at least three or four places where the advent of devolution has meant that projects have not gone forward. On the England-Wales border between Shrewsbury and Welshpool in my constituency a bad stretch of road is hugely inhibiting development, but because it is cross-border and committing money to its improvement is not a priority for the west midlands highways authority, the work cannot go ahead. We have to focus on Welsh and English Governments working together to overcome problems that inhibit development.

Rural Wales is a beautiful place, and that beauty is a great economic driver. To take full advantage of it, however, we must recognise its value and consider a wide definition of tourism rather than just the traditional ones. Where I live, in the village of Bettws there is a hatchery—a game shooting development—which employs 100 people. It is amazing. The income that shooting brings into Montgomeryshire and rural Wales is absolutely enormous—many tens of millions of pounds.

Last week I visited a new fish pass in Felindre near Llanidloes, which people might say is a small development; it cost £152,000, and was built by the Environment Agency, but it has hugely increased the size of the salmon spawning area in Wales. The Welsh salmon fishing industry contributes £150 million to the economy. The fish pass is a small development. It fits in. It is beautiful to look at and has a massive economic benefit. It is not just public authorities that are doing such things. On the same day, I called in on an osprey observation point close by. Nora and Monty, two ospreys that arrived many years ago, came back last week. I was the 350th person to visit that day, and 700 people had visited during the previous weekend. When the ospreys nest and have chicks, visitor numbers will increase. The development is a huge economic driver because of all the people coming in. [Interruption.] I see the hon. Member for Ceredigion (Mr Williams) nodding in agreement. On the same day, I travelled a little further into his constituency, stopping at Bwlch Nant yr Arian to watch the red kites feeding, as do hundreds of other people. Forty years ago I spent half a day in his constituency, at Pontrhydfendigaid and Cwmystwyth—this could be testing the Hansard people; I might have to check the report later. I sat there for half a day to watch one red kite half a mile away—

[Mr Jim Hood (in the Chair)]

Order.

11:54

[Roger Williams (Brecon and Radnorshire) (LD)]

It is a great pleasure to speak under your chairmanship, Mr Hood. I congratulate the hon. Member for Carmarthen West and South Pembrokeshire (Simon Hart) on securing the debate. I have fond memories of his constituency. Back in 1999, I stood in the first Assembly elections and managed to come fifth. The good people of his constituency were not ready for me then, but I enjoyed the experience and the fantastic countryside there.

The hon. Member for Carmarthen West and South Pembrokeshire has made the topic of this conversation deliberately wide, and Members have taken advantage of that. I want to mention one or two issues that perhaps have not been covered. First, I congratulate the Department for Environment, Food and Rural Affairs on its determined efforts to eradicate bovine TB in this country, which I know are appreciated by the farming people here. They do not bear comparison, however, with what is happening in Wales, where the farmers are almost despairing about what can be done to alleviate their problems.

I want to talk a little about financial services in rural areas. I have recently had the honour of introducing two debates in this Chamber on the closure of banks in rural areas, which is an important issue because rural communities want to attract not only tourists but businesses, and without banking facilities that can be difficult. I think that not just in rural areas or in Wales but more widely, the relationship between small businesses and banks has never been at a lower ebb.

[Mr Mark Williams]

Will my hon. Friend also reflect on the banks’ usual retort when asked about the diminishing number of branches, which is that online banking is a growing occurrence? In some parts of our constituencies that is not a reality because we have no broadband at all, let alone the superfast type.

[Roger Williams]

I absolutely agree with my hon. Friend, and it is not only the absence of broadband. Sometimes, older people do not have the facility or the aptitude to take advantage of online banking, so we still need the face-to-face presence and advice that bank customers greatly value.

The issue also goes a little further. Today, I was sad to see that the number of complaints about banks made by small businesses to the Financial Ombudsman Service has gone up by 10% in the past year. It is only very small businesses that can use the ombudsman facility, so we have a number of such businesses being badly treated by their banks. For instance, not only are overdraft or loan requests turned down but the terms and conditions of such facilities are changed midway through. The Government once again need to sit down with the banks and say, “If we are all in this together and we are going for growth, you have to play your part.”

I think that the Government sometimes do not really understand the structure of business in this country. Whenever they trumpet support for business they talk about reducing corporation tax. That is much valued, but out of the nearly 4 million businesses in England only one third are incorporated, so the other two thirds will not benefit from the reduction in the tax, and the £100,000 reduction in capital allowances will particularly weigh on businesses that pay their tax through self-assessment—sole traders and partners.

On the role of independent filling stations, one operator in Sennybridge in my constituency has brought me evidence that the wholesale operation of the petrol supply chain is concentrated in a small number of hands, which could lead to difficulties with competition and access. He has sent information to the Office of Fair Trading, and I will send a copy to the Minister. This is a dangerous situation. Many of our independent filling stations have already closed, and if the process continues, a lot more could do so.

I am looking at the time, Mr Hood. The clock says that I have spoken for 11 minutes already, so I am not sure how much longer I have.

[Mr Jim Hood (in the Chair)]

You have one minute left.

[Roger Williams]

I commend the legislation introduced in England by the Government on small businesses’ right to buy. I point to two examples in my constituency. The Shoemakers’ Arms, a pub in Pentre Bach that was closed, has been taken over by the local community and is now flourishing. The community in Llanbadarn Fynydd have done the same with their village shop and filling station. Those are examples not of short-termism but of sustained success. They show what communities can do if given the opportunity.

I promised to mention the traditional makers of cider in my speech, so I will do so in the last 10 seconds. For goodness’ sake, do not let us push them out of business in trying to deal with alcohol abuse in our society.

12:00

[Neil Parish (Tiverton and Honiton) (Con)]

It is a great pleasure to serve under you, Mr Hood. I congratulate my hon. Friend the Member for Carmarthen West and South Pembrokeshire (Simon Hart) on securing this debate on rural poverty and the rural countryside.

We must talk up the countryside, because we are sometimes victims of our own success. One reason why house prices are so high in the countryside is that people who come on holiday to Devon, Cornwall, Somerset and other places—they even venture into Wales occasionally—retire there. Of course, we welcome retired people, but they do drive up the price of houses. Then people who work in the countryside, where wages are usually about 12% to 15% lower, have great difficulty buying properties. That is why affordable homes and planning are important. We must enable local villages, hamlets and communities to have affordable homes. I would like not only affordable homes but shared ownership, which gives people a chance to buy a share in a property and later, perhaps, to buy the whole property. It allows more people into home ownership.

[Andrew Bridgen]

Is my hon. Friend aware that the average age in rural communities is seven years older than in urban communities? Is it not an option for exception sites—I will be pushing for my parishes in North West Leicestershire—to provide retirement bungalows for people, with qualifications? Often, a widow or widower who has lived in the village all their life may own a large family house. They no longer require all that space, but they do not want to lose their friends and relations in the village. If they moved to a retirement bungalow, they could free up a house so that a new family could move into the village.

[Neil Parish]

I agree with my hon. Friend. Managing housing stock effectively is absolutely right. We need a supply of retirement bungalows so that people can move out of three or four-bedroom houses and live in their own area. I am a great believer in encouraging people to move, not browbeating them. It is essential to have such housing in an area.

I congratulate the Minister on what the Department for Environment, Food and Rural Affairs has been doing about red tape in farming and agriculture. We want to extend that beyond farming to all small businesses. We are a nation of shopkeepers and small businesses, and nowhere are they more essential than in the countryside. We need much less regulation so that businesses can thrive.

Food prices are rising. Although many people might not welcome that, it is a stimulus to the countryside in many respects. It stimulates not only agriculture but food processing. I would welcome the Government announcement that we hope for in the Queen’s Speech of a grocery trade adjudicator to ensure that the right proportion of the prices that we pay in shops returns to those who produce and process the food. That is absolutely essential.

I know that I will not make myself entirely popular with those who represent constituencies involved with the oil industry when I say that what has driven up the price of petrol at the pumps is the fact that crude oil prices have risen. If crude oil prices have risen globally, the companies are making vast profits, because their investment has not increased. We should tap into that a little more in order to reduce fuel prices in the countryside. Fuel is not a luxury; it is a necessity. I do not care how much money the Government invest in rural bus services; in many places in my constituency, if one waited for a bus, it would never come, and if it came, it would probably be going in the wrong direction. That might be facetious, but it is absolutely true. We must face up to the reality that in many small rural areas, bus companies will never run efficiently. Where we can make that happen, we must, but we need to consider it.

Tourism is hugely valued and is linked with agriculture and the countryside, and we must help it. I welcome the Government money for that in Devon, Cornwall and Somerset.

[Jason McCartney (Colne Valley) (Con)]

I return to the start of my hon. Friend’s speech, which is positive about our rural communities. I agree that they are absolutely thriving. Over the Easter period, I visited an engineering business in my constituency that is expanding so fast—it has 70 workers now—that it cannot find premises. We have 11 micro-breweries in my Yorkshire constituency, and a new dye house—so there is lots of vibrancy in our rural communities.

[Mr Jim Hood (in the Chair)]

Order. The intervention is too long.

[Neil Parish]

I welcome my hon. Friend’s comments. I want to ensure that we do not leave this debate thinking that everything in the countryside is doom and gloom. There is much going on. That leads me to broadband and superfast broadband. The Government have invested £30 million in Devon and Somerset. We want to ensure that that delivers broadband to isolated areas as well, so that the easiest areas to get at are not picked off and the rest left. That is essential.

My final point involves school funding. Devon is 247th in the league; it is among the least funded in the country. We talk about fairness. I am not griping or grouching. We need fair delivery of funding throughout the country. Rural schools are small and cost more to run, so we need a fairer system.

I welcome this debate. The presence of Members from all parties shows how strongly we feel that the rural community deserves great support.

12:06

[Huw Irranca-Davies (Ogmore) (Lab)]

It is a pleasure to serve under your stewardship, Mr Hood. I congratulate the hon. Member for Carmarthen West and South Pembrokeshire (Simon Hart)—whose constituency might, sadly, disappear, like many others—on securing this debate. It is a fine opportunity to ask the Minister for an update on the Government’s progress or otherwise towards sustainable rural communities.

I congratulate all the Members who have made speeches and interventions; I am afraid that to mention them all would take my whole contribution, but they include the hon. Members for Carmarthen West and South Pembrokeshire, for Arfon (Hywel Williams), for Penrith and The Border (Rory Stewart), for Romsey and Southampton North (Caroline Nokes), for South East Cornwall (Sheryll Murray), for Montgomeryshire (Glyn Davies), for Brecon and Radnorshire (Roger Williams) and for Tiverton and Honiton (Neil Parish). They spoke splendidly on behalf of their constituents and about constituency matters. I particularly want to mention the hon. Member for North Antrim (Ian Paisley), who introduced a new concept to the parliamentary lexicon: an island off an island off an island. That is an extreme example of rurality.

The Minister and others here today will undoubtedly have received a sound schooling in the classics and will be familiar with the words of the esteemed Roman poet Virgil, who wrote 2,000 years ago—I apologise in advance for my limited Latin—“Quo moriture ruis?”, or

“Whither art thou rushing to destruction?”

At times in recent months, this Government, intent on the destruction of rural relationships built up over many years and of the countryside itself, have seemed to epitomise Virgil’s question. They have been seen to support rural communities only in the same way that Herod supported juvenile population control.

I refer of course to the national planning policy framework and its rushed, appallingly crass and ill-thought-out proposals for development. It seemed that the countryside, our green belt, our precious natural environment and our communities were set for destruction in a free for all, profit-driven rampage of executive homes, whereas the crying need in rural areas is for a range of homes, especially affordable homes for local people. The situation is worsening under this Government.

Concerns have been publicly and forcibly expressed by local authorities throughout the land, including Conservative-controlled authorities in the constituencies of the Under-Secretary of State for Communities and Local Government, the hon. Member for Hazel Grove (Andrew Stunell), the Minister for Housing and Local Government, the right hon. Member for Welwyn Hatfield (Grant Shapps) and, for good measure, the Chancellor himself. The sorts of organisation that one would be happy to take home to meet one’s mother, such as the National Trust and the Campaign to Protect Rural England, suddenly found themselves in complete opposition to the Government and vilified by them. It is not often that the National Trust is painted as a pinko, lefty, subversive group, but ConservativeHome, that megaphone for Tory tendencies on the web—if that is not mixing my technologies—described it as

“some demented Marxist agitprop outfit”,

while Government Ministers described its work as “risible”. Indeed, the eminently quotable and often-quoted Minister for the Cabinet Office weighed in by saying that

“our position is right. I think this idea that creating a presumption in favour of sustainable development is somehow a massive erosion of the ability to conserve, is—”.

The Minister then used an expletive that was deleted from reports. It was a vernacular term that I believe to be mid-18th century slang derived from the German for “balls.”

Those same Ministers have been forced by their own MPs and the voice of middle England into a series of humiliating U-turns. What was a seeming rush to destruction—not just of the countryside, but of the self-styled party of the countryside—has been barely rescued from disaster at the last moment. That is just one U-turn fiasco, which followed hot on the heels of the forestry sell-off fiasco. My advice to the Government and to Ministers is to think things through. If there are too many U-turns, the Government, not to mention the public, will not know which way they are facing on any issue.

I thank the hon. Member for Carmarthen West and South Pembrokeshire again for giving the Under-Secretary the opportunity to make clear where the Government stand on key areas of support for rural communities. Local enterprise partnerships have been noted for their variable quality and for their scant attention in many areas to rural economic development and farming. Does the Under-Secretary agree with those concerns and, if so, what is he doing about it?

The Government profess localism in every breath, so will the Under-Secretary guarantee that in the provision of housing on farms, local planning authorities will be given the flexibility to allow generational succession, in recognition of the worrying age profile of active farmers and the need to do everything possible to encourage new entrants? In response to the hon. Member for Montgomeryshire, who made a good speech, it is a question of attitudinal changes on the ground and of positivism towards the development of agricultural holdings. The Welsh Government have delivered such localism. Will the Westminster coalition Government do the same?

In every other breath, Ministers from the Department for Environment, Food and Rural Affairs profess the critical need to enhance food security for the UK, so will the Under-Secretary explain why food production does not feature in the core principles of the national planning policy framework?

Rural living and working have many advantages, particularly if remote working and advances in remote communications can be harnessed. What assessment has the Under-Secretary made of the brake placed on rural economic development by the emerging digital divide, whereby the expansion potential of rural businesses is frequently inhibited, the productivity of home workers is affected, and farmers have difficulty completing online forms because of broadband not-spots and slow broadband speeds? In that respect, I commend the Farmers Weekly “Battling for broadband” campaign. Is the Under-Secretary worried about the potential for a growing digital divide between superfast urban areas and super-slow remote rural economies? The latter could benefit so much more from good broadband access.

When I was a DEFRA Minister, I had the privilege of visiting tremendous communities and people who had come together to save their village shop, pub or library, or who had filled a transport gap by creating diverse community transport schemes. Increasingly, local people are being asked to do more and more to sustain the vitality of their communities, but since this Government came to power, support from regional development authorities has been lost because they were unceremoniously scrapped, the community-owned pubs support programme has been cut and local authority budgets are under pressure. As has been said, cuts to local authority funding hit rural communities hardest, because of the added cost of provision of services in rural areas. What are the Government doing against that stark backdrop to help a greater proportion of communities to save their pubs, shops, banks, post offices, libraries and other services?

More than 4 million UK households—the majority of them in rural areas—are off the main gas grid and rely on heating oil, liquefied petroleum gas, solid fuels, mains electricity and microgeneration. The average cost of heating a typical three-bedroom home in the UK can be 50% higher when using heating oil, and as much as 100% higher when using LPG rather than mains gas. What are the Government doing to support home owners in our rural communities, who are more exposed to household poverty because of rising off-grid costs?

May I ask the Under-Secretary when or whether we will see firm proposals on petrol pricing in rural areas? He and his colleagues spoke eloquently and regularly about the issue in opposition, yet the very selective trials in the Inner and Outer Hebrides, the islands in the Clyde, the Northern Isles and the Isles of Scilly, which offered a discount that was described at the time by the Chief Secretary to the Treasury as

“terrific news for communities which have long suffered the effects of high fuel costs”,

are already jeopardised by the overall rising cost of fuel, which threatens to wipe out the discount. That view is not mine, but that of the Chief Secretary’s Lib Dem comrade, the right hon. Member for Orkney and Shetland (Mr Carmichael). It is indeed “terrific news”, but I do not anticipate it appearing on Lib Dem fliers.

What has happened to wider plans on rural petrol pricing? Are they just another victim of the Chancellor’s relentless, one-eyed focus on deficit reduction above growth? What assessment has the Under-Secretary made of the impact on rural petrol retailers and of the warnings of Brian Madderson, chairman of Retail Motor Industry Petrol, the forecourt association, that with rural petrol already up to 8p a litre more expensive than at urban stations because of delivery costs, up to 250 of the current 1,900 rural forecourts could close in less than a decade, leaving “petrol deserts”? Does the Under-Secretary take that threat seriously and, if so, what specific discussions has he had with Ministers at the Department of Energy and Climate Change, who have direct responsibility for ensuring adequate coverage of petrol stations for strategic purposes across the UK?

A fifth of all bus services in England face the axe this year, thanks to the Government’s cuts to funding for local bus services. The issue is affecting the elderly and the young, increasing social isolation and impacting negatively on employment and training opportunities. Indeed, the Under-Secretary of State for Transport, the hon. Member for Lewes (Norman Baker) is emphatically earning a deserved reputation as the Beeching of the buses.

This Government are out of touch with the reality of rural lives, rural jobs and businesses, and rural services. [Interruption.]

[Mr Jim Hood (in the Chair)]

Order. I ask hon. Members to calm down.

[Huw Irranca-Davies]

Thank you, Mr Hood. Has DEFRA or the Under-Secretary made any assessment of the wider national impact of the withdrawal of Government support for UK-wide programmes, and of the deep, fast cuts agenda on rural communities? Will he confirm that all the cuts have a disproportionate effect on rural areas? Closures of court houses in small rural towns affect not only the individual, but local law firms. Will the NHS Commissioning Board take into account rurality when allocating resources? How does the much-vaunted—at least by the Lib Dems—pupil premium take into account the extra challenges of rural school provision? Costs for access to jobs and benefits advice and training are usually between 10% and 20% higher for those in rural areas. Any diminution in services or increased travel to work as a result of fewer job opportunities will worsen the effect, as will closures of Sure Start centres and poor access to child care and so on.

The Under-Secretary is a member of a Government who are out of touch. Their policies are incoherent, as Baroness Warsi said on “Newsnight” last night. Nothing epitomises this out-of-touch Government more than what has become known infamously as the pasty tax. I pay tribute to the campaigning stance of local papers such as the Western Morning News, which has highlighted the potential impact on jobs and the economy in places such as Cornwall and the south-west. I ask the Under-Secretary directly, for the record: what representations did he or other DEFRA Ministers make to the Treasury on behalf of the food production sector and workers in Cornwall and elsewhere? Will he intervene to set the record straight? Were any representations made—a meeting, a letter or an e-mail?

I began my speech with a reference to Virgil, cautioning the impetuous against the dangers of undue haste and rushing headlong to destruction. I can only guess that this Conservative-led, Lib Dem-partnered Government are pinning their future on another of the Latin poet and philosopher’s maxims:

“Hope on, and save yourself for prosperous times.”

12:19

[The Parliamentary Under-Secretary of State for Environment, Food and Rural Affairs (Richard Benyon)]

I think that we all enjoyed the comedy act put on by the hon. Member for Ogmore (Huw Irranca-Davies). Listening to the Opposition Front-Bench spokesman talking about rural matters is the absolute epitome of incoherence, which was a word that he used. It reminded me of the Judean People’s Front sitting around asking, “What have the Romans ever done for us?”

I thank my hon. Friend the Member for Carmarthen West and South Pembrokeshire (Simon Hart) for giving me this great opportunity to talk about some of the things that the coalition is doing for rural areas. I pay tribute to him for securing the debate and for the powerful speech that he made.

I will put on the record the ambition that DEFRA Ministers and the Government have for rural communities. If someone who is elderly, sick, mentally ill, out of work or on a low income lives in a rural community, the problems imposed by rurality are increased by isolation. Those are obvious points that we all understand. Therefore, the Government’s policy must recognise that and ensure that we are delivering services fairly and equally, so that the rurality in which that those people live does not adversely discriminate against their circumstances.

There has been talk of the sense of victimhood being felt by those who live in the countryside. That is legitimate to an extent because one might see a village that in every other sense looks idyllic, but there may be three or four homes—or 30 or 40 in a larger village—that contain people who are suffering deprivation, which is less visible than in a gritty city environment. We have to be nuanced, clever and careful, and focus our policies like a laser beam on helping those people.

That is one side of the issue, but the other side is equally important if we want to raise the aspirations of those who are suffering deprivation. We need to have a positive view of how the countryside can provide a driver for the economy of the country, and we need an uplifting view of the contribution that rural communities and the rural economy can play. That is the view we in this Government have. An idyllic, rural landscape is not just about the trees, the fields and the beauty that we see; it is about the noises of activity, business and life. It is also about children playing in a village school yard, a shop that is operating and, if we can roll out broadband, a creative industry operating out of a set of redundant farm buildings. That is what a true rural landscape is about.

For too long, Governments have imposed policy on rural areas using what the Americans call an “inside the beltway”—or within the M25—mentality. The view has been that if something is right for inside the M25 or within an urban setting, it must be right for the countryside. That is why the previous Government lost the faith of those living in the countryside and why it is ridiculous to hear the hon. Member for Ogmore, who is better than the speech he just made, try to pretend that somehow rural communities were better before.

In the short time I have left, I will try to address as many points made in the excellent contributions to the debate as I can. DEFRA is the rural champion within the Government. Our role is to help Departments understand the rural context and the issues that face rural businesses and communities. We have set up the rural communities policy unit right at the heart of DEFRA to encourage Departments to ensure that their policies and programmes meet rural needs and interests. That unit has been in operation for a year and is engaging effectively at an early stage in the development of policy across the Government.

The hon. Member for North Antrim (Ian Paisley) rightly referred to rural proofing. That is a subject for a debate in itself and is something we are taking seriously in our cross-Government role of ensuring that policies are not just considered within the beltway and that the impact on rural areas is understood.

The RCPU is working hard to engage proactively and communicate with rural communities and their representative organisations and to stimulate debate about rural needs and propose solutions. That work is critical to ensuring that evidence and intelligence from our rural stakeholders informs Government policy and its delivery. After the debate, I will attend the first annual meeting of the new rural and farming network, which involves chairs of all the rural and farming networks that we have set up around the country coming to meet Ministers. That is a welcome change and something that Lord Taylor, my right hon. Friend the Minister of State, Department for Environment, Food and Rural Affairs and I thought up in opposition. We have now implemented the initiative right across England, so that there is a real direct connection to Ministers and a two-way street of communication. We can therefore ask those involved how policies are working in their area, and they can tell us about their problems as well. Those new networks are a welcome and important addition to communication and to trying to ensure that rural communities do not feel isolated and not listened to, as they have undoubtedly been in the past.

We also work closely with Action with Communities in Rural England, so that the Government benefit from regular access to up-to-date local intelligence about rural areas and from talking to experts who can offer practical advice on the design and delivery of programmes and policies. The RCPU also regularly meets the Rural Coalition, which is under Lord Teverson’s chairmanship, to facilitate strategic input into key policy areas across the Government.

On ensuring that policy is connected, let us consider one example of why the previous Government got it wrong. The Rural Payments Agency encouraged farmers to fill in their forms online. A lot of farmers live in areas where there is lamentable or no broadband signal, so they ended up having to take their forms down to the pub on a memory stick to download their data to the RPA. That is one of many past examples of how not to do policy, and it also shows why broadband is so important.

Let us consider broadband in the wider context. Broadband is much more than just a deliverer of jobs; it is about social inclusion. In this debate, we have talked about health, education and skills and about wanting to get more young people living and working in our rural communities. Broadband is about providing opportunities for those young people. However, it is also about an elderly person being able to shop online and someone being able to have access to information that can improve their needs if they are, for example, out of work.

It should be—and it will be and it is—our absolute ambition to ensure that someone who lives in a remote part of, for example, the constituency of my hon. Friend the Member for Penrith and The Border (Rory Stewart) can set up and run a creative industry requiring a fast broadband speed as easily someone in one of our cities. That is our ambition. DEFRA has rolled out a rural broadband fund to try to get to those hardest-to-reach groups. Wonderful work has been done, not least in my hon. Friend’s constituency, which I visited recently. I saw the enthusiasm among local people to work with Broadband Delivery UK and other agencies to make sure that the roll-out of broadband is working. I entirely understand that when we make a bold announcement, people might feel frustrated and start to ask, “When is it going to happen? When will you start to deliver it?” Our commitment to have the best broadband across the country by 2015 is on track and it is important that we continue to maintain DEFRA’s role in reaching the hardest-to-reach groups of people. I entirely agree with my hon. Friend the Member for Sherwood (Mr Spencer) when he talked about broadband being the fourth utility.

My hon. Friend the Member for Carmarthen West and South Pembrokeshire who initiated the debate asked whether we could make sure that the Government are doing things not to the countryside but for the countryside. That is how we see ourselves in DEFRA. We are a team of Ministers with a real commitment, and we are driving the issue forward with key groups of people, such as the RCPU, so that we can make a difference to how people live.

In the minute that I have left, I want to cover health care. Under the Health and Social Care Act 2012, there is a commitment—a duty—on NHS commissioning boards to prevent health inequalities in local areas, which is a concern for a lot of people. For example, it is much easier to deliver stroke care therapies in a large city than in rural areas, where doing so is more expensive. That is just one example of Government policy. We want to ensure, working across the Government, that we propose effective policies in rural areas.

Many hon. Members made other points, but I am afraid that I am running out of time. I want to give this commitment. What we are talking about in supporting rural communities is both a positive, optimistic view and the need to recognise that there are very serious problems. We will need to have frequent conversations in the House about how successful—

[Mr Jim Hood (in the Chair)]

Order.

Death In Service Inheritance Tax

Tuesday 17th April 2012 Westminster Hall

12:30

[Mr David Hanson (Delyn) (Lab)]

It is a pleasure to serve under your chairmanship, Mr Hood.

The debate relates to death in service inheritance tax and the case of Nigel Lawrence Thomas. The debate goes to the heart of how we treat our servicemen and women who risk their lives on our behalf and who, like Nigel Thomas, pay the ultimate price.

[Mr Jim Hood (in the Chair)]

Order. May I ask the people at the back of the Chamber to leave without chattering?

[Mr Hanson]

Thank you, Mr Hood.

I have secured the debate to highlight an unfairness in the existing legislation that prevents some members of the armed forces who die in service from being exempt from inheritance tax, despite receiving conditions while on active service from which they later die.

Before I go into the facts of the case, I want to pay tribute to the family of Nigel Lawrence Thomas. His parents are my constituents, and they are still grieving over the loss of their son. They have asked me to ask the Minister to look again at the law on death in service inheritance tax. I am happy to do so, and I hope the Minister will also be happy to do so. I have been particularly humbled by the way in which Mr and Mrs Davies, who are the parents of Mr Thomas, have gone about raising this issue. They accept that it may be too late to see their situation revised, but they want to ensure that such circumstances do not occur in the future for other grieving families.

The facts are simply these. Nigel Lawrence Thomas served in the Royal Air Force from 1980 to 2004. At the time of the first Gulf war, between 1989 and 1992, he was stationed in Cyprus. For this service, he received the Gulf medal. I remind the Chamber that the Gulf medal was awarded to recognise

“service in the Gulf with special regard to the hardships and dangers which have accompanied duty there.”

While on active service in Cyprus, Nigel was exposed to radiation, following an accident. In March 1992, he was diagnosed with chronic myeloid leukaemia. Following the accident, he suffered from that illness for 18 years. Mr Thomas died on 28 March 2010.

A letter given to me by his family from the Service Personnel and Veterans Agency, dated 12 November 2010 and signed by Mrs E. Milligan, states clearly that, according to his death certificate, he died from

“intracranial bleed, which was secondary to thrombocytopenia; which in turn was secondary to the chronic myeloid leukaemia.”

The letter goes on to state that the chronic myeloid leukaemia is

“accepted as attributable to service”.

According to the letter that the family received from the SPVA, therefore, his death was

“due to or hastened by service”.

As a result, the SPVA agreed to meet the funeral expenses following Nigel’s death in March 2010.

Mr Thomas’s family have also provided me with a letter dated 16 July 2010 from Richard Clark, professor of haematology and consultant haematologist at the Royal Liverpool and Broadgreen university hospitals. These letters have previously been supplied to the Minister and the Ministry of Defence. Professor Clark confirms:

“there is clear and incontrovertible evidence that radiation can cause chronic myeloid leukaemia.”

He also goes on to confirm that the chronic myeloid leukaemia was

“undoubtedly what caused his untimely death”.

Those are the facts. Mr Thomas was a long-serving RAF pilot. He was stationed in Cyprus during the first Gulf war. He was supporting our war effort when he was exposed to radiation as the result of an accident. That exposure to radiation led to his untimely death two years ago, after suffering from cancer for 18 years.

Nigel Thomas’s funeral expenses were granted by the Ministry of Defence and the SPVA. On the basis that his death, as described in the letter, was due to service, the family applied for exemption from inheritance tax under section 154 of the Inheritance Tax Act 1984. The section disapplies the relevant inheritance tax provisions for death on active service of those who have

“died from a wound inflicted, accident occurring or disease contracted at a time when the conditions specified…were satisfied.”

Those conditions, specified in subsection 2, are that the disease was contracted

“(a) on active service against an enemy, or b) on other service of a warlike nature or which in the opinion of the Treasury involved the same risks as service of a warlike nature.”

My constituents looked at those provisions and felt that they should apply for the exemption, given that the death of Mr Thomas was, according the letter from the Ministry itself, due to service.

In a letter dated 13 August 2010 from the SPVA, which had granted funeral expenses, the claim for inheritance tax exemption was turned down. It said:

“we do not consider he was operating in a hostile or warlike environment and irrespective of whether your son’s illness can be linked to his military service, his service does not meet one of the key qualifying criteria for an exemption under section 154 of the Inheritance Tax Act as it is apparent that his condition was not sustained by service of a warlike nature.”

As a result of that decision, the family were liable for an inheritance tax bill of £33,011 on Mr Thomas’s estate. Incidentally, that figure includes £9.22 interest payable for late payment—the state certainly knows how to treat those who died in its service. The sticking point appears to be that the SPVA has determined that

“his condition was not sustained by service of a warlike nature.”

In a letter dated 7 February 2011, the Minister—who was elected on the same day as I was 20 years ago last week—reiterated the position set out by the SPVA:

“his service must be of a warlike nature and regrettably this key qualifying criteria for exemption has not been met.”

I wish to challenge that position today.

First, on the claim that the leukaemia from which my constituents’ son died was not sustained by service of a warlike nature, I remind the Chamber of the facts. My constituent served in the RAF for 24 years. At the time of his exposure to radiation, he was supporting operations in the first Gulf war. I argue that that was active service as set out in the 1984 Act. The Gulf war campaign in which my constituents’ son served was issued a campaign medal by the Committee on the Grant of Honours, Decorations and Medals to recognise

“service in the Gulf with special regard to the hardships and dangers which have accompanied duty there.”

My constituent qualified for the Gulf medal for his service, yet he did not qualify for an inheritance tax exemption. He was exposed to radiation in an accident that occurred at that time. There were considerable dangers. In serving his country, Mr Thomas contracted the leukaemia that, as has been agreed, killed him. Medical evidence from those who treated Mr Thomas also says that it killed him. He was exposed to radiation only because he was stationed in Cyprus, serving his country during a war, which leads me to a second point.

If we accept that the circumstances in which Mr Thomas was exposed to radiation could not be constituted as being of a “warlike nature”, or indeed “active service”, surely the legislation needs to be looked at again and amended. It is now 28 years old, and it is right that we review it, so that it is fair to those who die as a result of their service. If the legislation is so tightly defined as to exclude Mr Thomas from the inheritance tax provisions, I truly believe it is not fair to the families of those brave service people who give their lives in the service of their country. I am discussing the matter with the Royal British Legion, which will take an active interest in the debate today and will look carefully at the Minister’s response to what I have said in support of my constituents.

There were considerable dangers for Mr Thomas while supporting operations in Cyprus during the Gulf war, which were recognised through the Gulf medal. It cannot be fair that, although he performed an integral supporting role in the operations, he is not entitled to the exemption, as those who fall on the other side of section 154 of the 1984 Act are. It is beyond doubt that Mr Thomas died of a condition contracted while serving his country during the Gulf war.

I ask the Minister to look again at the legislation, so that other families do not fall foul of its provisions. We should do all that we can to support families who have lost a loved one as a result of active service protecting our shores. I have several questions for him that I hope he will reflect on to look at the matters in detail again, if not in today’s debate, then afterwards. It is important that I ask him again to review the claim made by Nigel’s family, following his death in March 2010. I appreciate that he has reviewed it, as he said to me in a letter at the time, but I ask him to do it once more. He has a duty to look at it once again, because Nigel Thomas died of leukaemia contracted through radiation in service.

Mr Thomas’s death was a tragedy for the family that raises wider issues, so, more importantly for the public and the wider armed forces, will the Minister commit today to reviewing the operation of section 154 of the 1984 Act? I want him to focus particularly on the use of the word “active”, as it remains my view that service can cause death, and if it is proved to have caused death, that should be sufficient for the exemption to apply. At the moment, the focus is on “active service”, and we could debate all day whether service in Cyprus in support of operations in the Gulf was active service. It could be interpreted as active service. If the wording was simply “service” rather than “active service”, I believe that Mr Thomas’s family would have been exempt from inheritance tax and that could have saved them a bill of £33,000 at a time when they were coming to terms with the death of their son.

I humbly suggest that the review focus on the current appropriateness of section 154. There have been a number of conflicts since 1984, and they have become ever more complex, with a range of issues to examine. The legislation is 28 years old and is worthy of review by the Minister. Will he assess the anticipated demand from revising the section? He can look at how many claims like that of Nigel Thomas’s family have been made and how many the SPVA has turned down. I am not aware of that many. I do not believe that there will be a massive flow of cases giving the Government a liability of millions of pounds, but I would welcome a review to examine whether such cases have been brought and how many. I would also welcome the Minister consulting the Royal British Legion and other parties on the provisions of the 1984 Act. Will he report to the House, either by letter or written statement, on the outcome of the review, so that he can at least tell me and those who are interested in the case, but more importantly Nigel Thomas’s family, that he has gone the extra mile to look at whether they were treated fairly in the period following Nigel’s death?

The loss to Nigel’s family is immense and a grievous blow, but they hope, and have asked me to ensure, that raising Nigel’s death in this way, having raised it with the Minister in correspondence, will lead to a change, so that families in future do not have to face the same injustice that Nigel’s family have had to endure. Nigel Thomas gave his life in service to his country. Had he died by bullet, his estate would not have paid inheritance tax; but because he died from cancer caused by radiation, his estate has not been exempted. It is a grave injustice that I hope the Minister will redress today.

12:46

[The Parliamentary Under-Secretary of State for Defence (Mr Andrew Robathan)]

It is a pleasure to speak under your chairmanship for, I think, the first time, Mr Hood. The topic is important and sensitive, and I am grateful for the opportunity to respond.

We in the Ministry of Defence strive very hard to provide appropriate support to bereaved families when one of our serving or former service personnel loses their life. I am always saddened to hear of cases in which families feel that they have not received the support that they should at the time of their loss. The background to the case of Mr Thomas is a tragedy and I extend my sympathy to his family, who are still most upset about his death and the issues raised. The passing of time does not always ease the pain of bereavement, particularly when it is worsened by the feeling that the support provided at the time was not sufficient. I assure the right hon. Member for Delyn (Mr Hanson) that the support provided to next of kin and other grieving relatives continues to improve.

When a service person dies in service, an appropriate representative will be appointed from the casualty’s own service as the prime point of contact for the next of kin, and in some instances the emergency contact, if considered appropriate. That person will be a dedicated officer known as the visiting officer, and they will guide and assist the next of kin in repatriation and funeral procedures—I regret to say that that is all too often with Operation Herrick—and will help with any questions the family may have. The visiting officer provides a crucial liaison between families and the services, which continues for as long as it is needed. A veterans’ welfare officer will also be appointed from within the Service Personnel and Veterans Agency to assist the dependants of the deceased. They can provide advice and guidance on the comprehensive package of benefits that may be available under the armed forces pension and armed forces compensation schemes, brought in by the previous Government, of which the right hon. Gentleman was a member, and on other more wide-ranging issues, such as housing and benefit entitlements from the Department for Work and Pensions.

Although some defence charities, such as SSAFA Forces Help or the Royal British Legion, cannot make direct or unsolicited contact with service families, they can provide long-term support to bereaved service families who approach them, including a support group consisting of bereaved relatives meeting on a regular basis to offer support to each other.

The whole Government recognise that service personnel such as Mr Thomas warrant special consideration in acknowledgment of the particular debt of gratitude owed to them for service given in the cause of national defence and international peace. We are aware of the sacrifices made by those who have risked their lives and suffered hardship in facing the challenges of military service. On 16 May 2011, the Secretary of State for Defence published the armed forces covenant—a new tri-service document and the first of its kind. It sets out what service personnel and their families can expect from the Government and the nation in recognition of what we ask them to do to keep us safe. The Government are determined to remove disadvantages encountered as a result of service and, by publishing the covenant, we have established the right direction of travel.

The case of Nigel Lawrence Thomas is a very sad one and, again, I extend my condolences to his parents and other family members. Mr Thomas proudly served his country as a member of the Royal Air Force until he was discharged in 2004. His life was then tragically cut short by chronic myeloid leukaemia and secondary conditions in March 2010. From previous endeavours on behalf of Nigel’s mother, Mrs Davies, the right hon. Gentleman will be aware that, subsequent to the sad loss of her son, she first made enquiries about an exemption from inheritance tax at the Service Personnel and Veterans Agency in June 2010.

In recognition of the particular debt of gratitude that we owe to our former service personnel, it is only right and proper that in certain circumstances special consideration be given as to whether a deceased person’s estate should be exempt from inheritance tax. The right hon. Gentleman described some such conditions. A deceased service person’s estate may be exempt from inheritance tax if, under delegated authority from the Secretary of State for Defence, my officials certify that section 154 of the Inheritance Tax Act 1984 applies. Under the Act, such certification can be given when the deceased has died from a wound inflicted, accident occurring or disease contracted at a time when they were on active service against an enemy, or on service of a warlike nature. Certification may also be given in instances in which a service person dies from a disease contracted at some previous time if the death were due to or hastened by the aggravation of a disease during a period of such service. If such certification is given, my officials will recommend to Her Majesty’s Revenue and Customs that an estate should be exempt from paying inheritance tax. There is, however, no automatic exemption from inheritance tax for veterans. Deaths in retirement resulting from natural causes, road traffic accidents, or injuries or illnesses that were not contracted during or aggravated by war or warlike service do not qualify for an exemption. Equally, if individuals have a wound or illness arising from their service that might have eventually killed them but they die from a wholly unrelated cause, if the wound or illness played no part in their demise, their estate cannot be certified as exempt from inheritance tax.

Mr Thomas served in Cyprus from 1989 until 1992, and it is recognised that for at least part of that period he was operating in a role in support of operations in the Gulf during the first Gulf war. From his service record, however, it is evident that during that time he did not undertake deployed service in Saudi Arabia, Kuwait or Iraq, or come into direct contact with Iraqi forces. As such, my officials were unable to recommend that his estate be considered for exemption from inheritance tax, as the criteria defined under section 154 of the Act had not been met. A request by the family for the payment by my Department of funeral expenses in respect of Mr Thomas was approved because, in the view of an MOD medical adviser, it could not be demonstrated beyond reasonable doubt that some aspect of his service did not cause the condition that led to his death. That is, however, a quite separate issue from the matter of whether an estate should or should not be eligible for an exemption from inheritance tax. The criteria involved are quite different, and it would be wrong to assume that the decision to pay funeral expenses undermines the decision by my officials not to recommend an exemption. Similarly, the award of the Gulf medal for the first Gulf war was made on the basis that people were supporting, full-time, the operation, and not on whether they were engaged in warlike service.

The right hon. Gentleman asked me to look again in particular at the legislation. I assure him that I will, on his behalf, because he has raised an important case. First, as requested, I will review the case and look in particular at the accident referred to in his speech. Secondly, I will review the operation of section 154 of the Inheritance Tax Act 1984, in conjunction with my colleagues in the Treasury. He particularly asked me whether I was happy to go the extra mile for the family of Nigel Thomas, whose case the right hon. Gentleman has articulated so well today. I certainly will and hope that he may be reassured by that.

[Mr Hanson]

If I may respond to the Minister’s comments, I thank him personally, on behalf of the family, for agreeing to review the case of Mr Thomas. I also thank him for his promised review of section 154 of the Act. In my speech, I asked whether the Minister could report back to the House. I should be grateful if he would confirm that he will either write to me or issue a written statement following that review so that we can have some clarity on the outcomes, and if he would let me know the time scale of the review.

[Mr Robathan]

I assure the right hon. Gentleman that I shall reply to him. Time scales, as he knows from his past as a Minister, can sometimes be what I might call slightly fluid, but I shall endeavour to be as timely as possible.

Railway Stations

Tuesday 17th April 2012 Westminster Hall

12:55

[Stephen McPartland (Stevenage) (Con)]

It is a pleasure to serve under your chairmanship, Mr Hood.

My constituency includes the rail stations of Stevenage and Knebworth, both operated by First Capital Connect. We have sought the debate today to illustrate some of our difficulties in achieving station improvements in small towns and cities throughout the country. I will focus predominantly on my constituency of Stevenage, but I know that other Members present wish to intervene.

Stevenage station opened on its new site back in 1973, which was a few years before I was born. That illustrates the age of the station. It is an important hub for Hertfordshire, with Stansted airport on one side and Luton airport on the other; many services to the north of the country run by East Coast trains leave Stevenage, and the station sees more than 4 million passenger movements a year, with Knebworth station seeing almost half a million a year. Stevenage is quite a large and important regional train service hub. Bearing that in mind, First Capital Connect will be operating a 100-day peak service before, during and just after the Olympics, as hundreds of thousands of people use stations in my constituency to travel to King’s Cross to get across London to the Olympics. I am also proud that we will welcome the Olympic torch to Stevenage on 8 July; I look forward to a large boost to our local economy as a result.

I take the opportunity to commend the present and the previous Government for the fantastic transformations to King’s Cross and St Pancras railway stations. Both are iconic. I commute into King’s Cross every single day, from Stevenage, which is less than 30 miles away. My personal experience is that the station has improved a great deal. A lot of scaffolding was up for many years, but it has now been cleared away and, once again, the sunlight can be seen. There are similarities with Gatwick airport, with its departure and arrival lounges, and the station is looking much better.

King’s Cross is a category A station, the gateway to London for my constituents and millions of others, and yet, of my stations, Stevenage is category C and Knebworth category E. The Minister might be anticipating a long moan about the lack of investment in local train stations by all Governments and expecting me to lament the challenges that my constituents face trying to travel less than 30 miles to London, negotiating their way through all the obstacles, but the journey experience for passengers from my area has improved over the past few years, mainly due to the thousands of extra seats available at peak times. Nevertheless, I would like to reiterate on behalf of passengers, including myself, how annoying the annual increase in rail fares is and that we resent it predominantly because we do not feel that we are getting value for money, especially with the local council earning millions of pounds out of exorbitant car parking charges. I am lucky enough to be able to walk to the train station from my home in Stevenage, but many of my constituents are not as fortunate and have to pay large car parking charges on top of the large rail fares. For a 30-mile journey from Stevenage to King’s Cross, an annual travelcard costs well in excess of £4,000.

I would like to remain as positive as possible, however, because I am proud of my local area, so I will set out some of the improvements we have seen over the past five years, to Stevenage station in particular. A gate-line installation massively improved security and revenue protection along the whole line. The overbridge at Stevenage has a new kiosk, the toilets have been refurbished, the ticket office now has induction loops, the station has been repainted and there are food and drink vending machines. The ticket office is compliant with the Disability Discrimination Act 1995, cycle parking has been improved twice—three or four years ago, and last year it was increased by another 55%, with a £36,000 investment—and the waiting rooms have been refurbished. We now have four CCTV cameras installed and one thin film transistor or TFT-enhanced LCD display screen, so that we can all see what time the train is coming and how long it will be delayed for. We have DDA-compliant handrails to stairways. The Cambridge capacity study has reviewed and launched installation of dispatch equipment to allow for 12-car trains, so if we can obtain the rolling stock, thousands more seats will be available for even more of us to have a seat on our commute to London.

Network Rail’s national station improvement programme has led to platform seating being renewed, and station signage has been replaced. A new customer information service screen has been installed in the waiting room on platform 1, so people can sit down and not get wet when looking to see what time their train will come. Meeting point signage systems have also been installed. There has been a host of further welcome improvements to security in conjunction with British Transport Police, and both my local stations—Stevenage and Knebworth— are now fully accredited as safer stations. That is all good news, and positive.

There are many more improvements to look forward to over the next few years, including plans to resurface platforms later this year. Network Rail plans to make minor extensions to the platforms so that we can have 12-car trains. Most important, access-for-all funding is allowing conversion of the goods lift to a fully automated passenger lift. That is costing £578,000, and disabled passengers will be able to use the lift, instead of waiting for a member of staff to unlock the goods lift, which is totally inappropriate. I welcome the additional funding, and that work is due to be completed in March 2014.

[Lilian Greenwood (Nottingham South) (Lab)]

I am listening with interest to the hon. Gentleman’s description of the improvements at Stevenage station. The hon. Gentleman also mentioned Knebworth station in his constituency. Does he share my concern that investment in stations to make them more accessible and modern will be completely wasted if the Government press ahead with plans to close ticket offices? Knebworth is mentioned in the McNulty report as a station that may have its ticket office closed. Many people rely on staff at stations to help them.

[Mr Jim Hood (in the Chair)]

Order. The hon. Lady’s intervention is too long.

[Stephen McPartland]

I understand what the hon. Lady is suggesting, and I assure her that we are running a campaign to keep Knebworth station’s ticket office open. I am pleased that First Capital Connect has assured us that it has no plans to close the ticket office. I will refer later to the Government’s Command Paper, “Reforming our Railways”, and to giving more power to train operating companies to keep some stations open.

[Jim Shannon (Strangford) (DUP)]

The hon. Gentleman said clearly that it was important to have a good rail service and modernised stations. Does he believe that potential for tourism could be realised from that work, and that that should happen along with modernisation of stations?

[Stephen McPartland]

I agree with the hon. Gentleman that there is potential for tourism. Stevenage is home to Knebworth park, which is the largest outdoor venue for concerts. Robbie Williams performed there in front of 250,000 people. Large events take place in my constituency every summer, and the railway station is the gateway for hundreds of thousands of people.

[Mr Andrew Smith (Oxford East) (Lab)]

I congratulate the hon. Gentleman on securing this debate, and the passion with which he is advocating the case for Stevenage. Does he accept that in the modernisation programme for the railways, it makes sense for some stations to be relocated so that they are in a modern context and a true gateway to the city? One such case is Oxford, which I am pressing, and I am grateful for the opportunity to put that on the record.

[Stephen McPartland]

I am grateful for the right hon. Gentleman’s intervention. When the new Stevenage station opened in 1973, it was relocated half a mile down the line nearer the town centre. There is sometimes a case for relocating stations.

[Richard Graham (Gloucester) (Con)]

Does my hon. Friend agree that work on the lift for disabled people at Stevenage in his constituency—the same is happening at Gloucester—has come later than we would have liked, because it was not done during the 13 years of the previous Government? However, it suggests that priorities such as helping disabled people on stations are finally in the right place.

[Stephen McPartland]

My hon. Friend makes an important point. I am a Conservative MP, and I do not want to be party political, but I agree with him.

My final point is that we have high hopes of receiving money to improve the concourse under the national station improvement plan. I am not sure that Stevenage station will look as good as King’s Cross station, but we can hope.

[Gareth Johnson (Dartford) (Con)]

I know that my hon. Friend strongly supports commuters in Stevenage. Does he agree that modernisation of train stations is a wonderful opportunity to improve passenger safety, particularly at night? At too many stations, such as Stone Crossing in my constituency, passengers feel intimidated when they return home late in the evening, particularly in winter when it is dark, and that puts them off using the railways.

[Stephen McPartland]

My hon. Friend makes an excellent point. I am the founder of the Knebworth and Stevenage rail user group, which I set up some years ago when I commuted to London for my previous job. Installation of the gate line at Stevenage made a massive difference to station security. First Capital Connect employs people to work with British Transport police, such as police community support officers, and contributes to some of the cost so that we have designated officers on our line. The number of incidents has shown that crime on the line has been reduced as that revenue has been secured. Often, it is people who have travelled without tickets who engage in minor crime. I agree with my hon. Friend.

We have given the Minister an easy ride so far. I have spoken about the great things being done at stations that are collectively improving passengers’ experience at stations in my constituency. However, the changes are incremental, and highlight the fact that the current system does not work. Network Rail effectively owns and manages station improvements, so in reality the money goes towards the big iconic category A projects, such as King’s Cross, when local stations also need investment. There is much more to do at my local stations, but major works are constrained by the relationship between Network Rail and the train operating companies.

[Simon Hart (Carmarthen West and South Pembrokeshire) (Con)]

In my constituency in Wales, the platforms at Tenby and Whitland stations are the responsibility of one organisation, the track is the responsibility of another, the trains are the responsibility of yet another, and the car park is often the responsibility of the local authority. How can we achieve the desired solution when so many different people can duck their responsibility?

[Stephen McPartland]

My hon. Friend pre-empts two questions that I intend to ask the Minister at the end of my speech. They are excellent questions, which I hope the Minister will take on board. It is incumbent on all of us here to ensure that we move forward with the proposals coming down the line. The problem is that Network Rail is responsible for 2,500 stations throughout the country, and invests a huge amount of money in stations with low customer satisfaction and high footfall. Money will go to King’s Cross, where there are 25 million passenger movements a year, Leeds, where there are 21 million passenger movements a year, and other northern regional stations.

I welcome the Government’s Command Paper, “Reforming our Railways”, which was released last month, and is a huge step forward. The Minister of State for Transport welcomed the success of the national station improvement programme that was launched by the previous Government. The chairman of the Association of Train Operating Companies has said that it is a great example of what the industry can achieve by working together, and has exceeded the original objective. I understand that that was to improve 150 stations, but that 250 have been improved because the train operating companies used more money efficiently and locally.

We must go further and faster, and not waste the opportunity of the new, longer franchises that we are about to give to train operating companies. We must change the landlord and tenant relationship for stations by moving towards fully repairing leases, and making the train companies responsible for the whole station and its upkeep, not just certain parts of it as under current leases. That is what passengers and the train operating companies want. They want the train operating companies to have the ability to get on with the job.

I have two questions for the Minister. First, will he consider introducing fully self-repairing leases in franchises for category C stations and below, thus allowing Network Rail to retain responsibility for bigger projects, and train operating companies to retain responsibility for smaller stations that are, as in my constituency, important regional hubs? That would provide train operating companies with a visual demonstration of their brand.

Secondly, the Command Paper welcomes devolving decisions to local level, but that is to large bodies such as councils and local enterprise partnerships, which many passengers believe are out of touch and irrelevant to their journey needs. I want to give train companies the funding, power and responsibility to improve our stations, and I want them to be directly accountable to local people. In a written question, I asked

“what arrangements are in place for the removal of rail franchises where rail passengers are dissatisfied with the service provided by their local rail operators”.—[Official Report, 13 December 2010; Vol. 520, c. 517W.]

and the basic premise of the response was that no such obligation exists for passenger satisfaction. I urge the Minister to consider creating that obligation as part of any new franchise arrangements.

13:10

[John Stevenson (Carlisle) (Con)]

I am delighted to take part in this debate, and I congratulate my hon. Friend the Member for Stevenage (Stephen McPartland) on securing it. It is an important subject that is relevant to many smaller cities and towns and their railway stations.

When we talk about communication, we often talk about the internet, broadband, super broadband, how fast it is and how much information we can download and how quickly. It is the modern way of communication and, quite rightly, its success is important to cities such as Carlisle and towns such as Stevenage, as well as to the country. If we go back 160 years, however, the railways were starting to achieve exactly the same thing. They were connecting the country, reducing the communication time between places, and bringing people and businesses together. At that time, rail was a transport, communication and economic revolution, and it still matters today.

Carlisle Citadel station in my constituency was built in 1847 and extended in 1875. At that time it connected Carlisle to all parts of the country, including the major centres of London and Glasgow and across to the east and Newcastle. The station is a great example of Victorian architecture and construction, and in many respects it is still a fantastic building and extremely relevant. It is an important communication centre for local people who wish to get to London or to Newcastle, and rail travel is important for both passengers and freight.

However good the internet is, people and goods will still need to move around the country and we will still need the railway network. On the west coast line in particular, rail travel has improved enormously and passenger numbers have increased dramatically. Credit must be given to the previous Government for the amount of money that was invested in much of the west coast line, and particularly the rail lines that received about £10 billion of investment. Substantial investment has also gone into trains, and new carriages will soon be in use on the west coast line. Service on trains has improved enormously—I can pay testament to that as I have gone up and down the west coast line looking at what Virgin has done, and I think it is a great improvement.

There is, however, a missing link regarding investment in stations, especially those outside the major cities. My hon. Friend alluded to the fact that although some larger stations have received substantial investment and improved enormously, many of the smaller stations have missed out. A 2009 report stated that overall train passenger satisfaction stood at 81%, although satisfaction with stations was just 65%.

A 2009 report from the Department for Transport stated:

“Stations cannot be seen in isolation—they are part of the total journey experience. This was dramatically demonstrated to us in Spain where the new high speed lines offer a consistent world-class travel experience from modern stations to modern trains and re-generated cities. Stations are deeply entwined with their local community and effectively act as the gateway to both town and railway. They leave passengers with their lasting impressions of both—a dilapidated station is bad business for both town and railway.”

I completely agree.

It is vital for our rail network that stations are modernised and that the passenger experience is greatly improved. If I may be parochial, Carlisle station has huge opportunities, but over the past 40 years it has seen little investment. The station now contains just two coffee shops and one newsagent, and not a lot else. It could be given an improved layout, and much of it could be refurbished which would enhance it enormously. New facilities such as shops and coffee bars could be encouraged, and there is the potential to create a transport hub by redesigning the entrances and the whole station. The transport network must work closely with local authorities to try and ensure that the passenger experience is greatly improved.

Such improvements are needed not only in Carlisle but in many of our stations and smaller cities and towns up and down the country. I would like to see the Government accept the need for such modernisation, and encourage stations, railway companies, local authorities and developers to work together to achieve improvements for our smaller stations. Where possible, seed money could be used to help kick-start such developments and improvements, but most importantly of all—this is critical—all future franchise agreements should include contractual obligations on rail companies to invest, upgrade and improve our stations, especially those outwith the major centres.

[Jason McCartney (Colne Valley) (Con)]

With your indulgence, Mr Hood, I have three quick points. First, King’s Cross cost the same as the entire northern hub project, which would benefit the entire north; secondly, we must consider the importance of parking at our local stations—it is a nightmare at Marsden, Honley and Brockholes in my patch; thirdly, does my hon. Friend acknowledge the important role played by rail user groups and friends of stations in looking after their local stations?

[John Stevenson]

I completely agree with my hon. Friend; he is absolutely right. Just as broadband is vital to the future economy, so is the success of the railway network and its stations. I hope that the Government will ensure that the modernisation of stations is made a priority.

13:16

[The Parliamentary Under-Secretary of State for Transport (Norman Baker)]

It is nice to see you in the Chair, Mr Hood. I remember that in one of my first outings in this place, you were chairing a deeply worthy Committee on some European legislation, of which I was a member back in 1997. I congratulate my hon. Friend the Member for Stevenage (Stephen McPartland) on securing this debate on an important issue for many passengers across the network. Nine Members have already contributed to this half-hour debate, which shows the enthusiasm and interest in this subject felt by Members across the House.

The Government understand that the quality of stations is important for passengers, and we are committed to facilitating investment in station improvements through reforms to how the railways are run. We are granting longer rail franchises in order to give train operators the incentive to invest in the improvements that passengers want, including better stations.

To pick up one of my hon. Friend’s questions and the repairing leases to which he referred, we are committed to giving train operators full responsibility for the management and operation of many stations, and we are starting that process now in stations covered by the shorter Greater Anglia franchise, and the West Coast Railways franchise—my hon. Friend the Member for Carlisle (John Stevenson) will be particularly interested in that.

The comprehensive spending review secured funding for a range of major station improvements to be completed over the next few years, including at Reading, Birmingham New Street, Blackfriars and London Bridge. We are also continuing to fund other improvements through the national stations improvement programme, the Access for All programme, and the station commercial project facility. Further funding for station improvements for 2014-19 will be considered as part of the high-level output specification process, with an announcement about further investment expected in the summer.

Over the past two years we have seen record levels of investment in the rail industry; this is the biggest programme of investment since Victorian times, and it is set against the backdrop of a difficult economic situation, both for public finances and in the country more generally. As a rail enthusiast from the Lib-Dem Benches, I believe that this is the most pro-rail Government that this country has seen for decades.

My hon. Friend the Member for Stevenage mentioned rail fares, and I hope he has noticed that the coalition Government have decided to retain the previous Government’s arrangement of RPI plus 1% this year, in recognition of the challenges that we face. A major programme of investment is taking place on the railways and it must be paid for. Part of the Government’s challenge is to drive down the cost of the railways to ensure that the public and the taxpayer get best value for money from investments across the network.

[Lilian Greenwood]

Will the Minister give way?

[Norman Baker]

I would like to make some progress and address the points raised by my hon. Friend, but if there is time at the end of the debate, I will give way to the hon. Lady. As my hon. Friend mentioned, Stevenage has already benefited from the national stations improvement programme, and almost £100,000 has been spent on new waiting shelters, seating and station signage. A further £150,000 is due to be spent on a full refurbishment of the concourse area, with work expected to commence later this year. Although Stevenage is already deemed to be accessible, as my hon. Friend rightly mentioned, we are ploughing in money from the Access for All programme to convert two of the goods lifts to passenger lifts, at a cost of £578,000. In addition, Access for All money has already been used to fund the installation of ticket office induction loops, a low-level, split-level ticket office counter, handrails to existing staircases and compliant “Meeting Point” signage.

Therefore, to pick up my hon. Friend’s point, I would not necessarily agree that the current system does not work. What I have outlined demonstrates that it does work. However, I would agree that transferring more responsibility to train companies is likely to improve matters even further. Network Rail, of course, has responsibility for some of the major stations in our country. It has done a fantastic job at King’s Cross and at St Pancras with Eurostar. We are now seeing the belief in railways restated. For a long time, stations were regarded as something to be embarrassed about by the railway industry. That was the case back in the 1960s, ’70s and ’80s. Now, there is a new confidence about the railways. The way King’s Cross has been re-engineered demonstrates that. However, it is right that we should have that benefit translated across the network and not simply at the big stations. My hon. Friend is right to make that point.

It is planned to spend £100,000 of money from the national stations improvement programme to improve the waiting shelters at Knebworth station. My hon. Friend will know that some Access for All money was used to fund smaller-scale improvements to the staircase and signage there as well.

The national stations improvement programme is a good example of the members of the industry working together to deliver benefits for passengers. It is the case that £150 million has been made available over five years to improve passenger facilities at busy stations in England and Wales that the public have identified as not up to scratch. The choice of schemes has been managed at local level, with Network Rail and train companies working together to agree the most efficient way to deliver the upgrades. About £101 million of that money has been spent so far on improving stations, and about 100 projects have been completed so far, benefiting more than 240 stations. In addition, many schemes have attracted third-party contributions, whether from local authorities or other funding bodies. The £26 million of additional money has allowed us to provide even more improvements.

NSIP is also helping to fund an information zoning initiative at stations in England. The aim is to make it easier for passengers to find appropriate information in different parts of stations, including information about local transport facilities for onward travel. We regard the end-to-end journey concept as very important if we are to make rail travel work as well as it can.

My hon. Friend the Member for Carlisle will know, I hope, that £450,000 of NSIP money has been spent on improving Carlisle station, including renovating the waiting room on the London-bound platform, refurbishing the existing waiting room and constructing a new seated waiting area and gateway to the historic Settle-Carlisle line. As I also hope he knows, we plan to spend a further £1.8 million of Access for All money on providing a new accessible route, with two new lifts, at Carlisle station. Works are currently scheduled to start on site in October 2013.

I should say that the Access for All programme is delivered with DFT money. Therefore, that is not in the gift of Network Rail. The coalition Government have made it a priority to try to improve disabled access at stations. That is why we have continued with that programme.

[John Stevenson]

On that point, does the Minister agree that it is important that we encourage the franchisees to invest their money in the stations, in addition to the taxpayers’ money?

[Norman Baker]

Yes, indeed. We agree with that point, and in relation to all the transport funding that we have identified, whether for railways or elsewhere, we have tried as far as possible to drive down costs and get better value for money, but also to unlock match funding, whether from local authorities, transport operators or wherever. We have been successful at doing that. If people look at the development pool scheme and local authority schemes, for example, they will see that we have managed to proceed with a huge number of those that would not otherwise have gone ahead, because of those approaches, which have driven down costs and got extra funding from elsewhere. We entirely endorse that approach.

[Lilian Greenwood]

How can the Minister claim that this is a rail-friendly Government when fares are due to rise by RPI plus 3% for the rest of this Parliament and 675 category E stations face losing all their staff?

[Norman Baker]

I am sorry that I let the hon. Lady intervene to disrupt what was a unified approach to improving the railways. Nevertheless, let me say for the record that the RPI plus 1% arrangement, which is the one in place this year, was introduced by the previous Labour Government for about 10 years. Indeed, they reversed RPI minus 1% and made it RPI plus 1%, so Labour Members are probably not in a good position to argue about rail fares. In addition, I will say that no decisions have been taken on closing ticket offices. There is a recommendation in the McNulty report about ticket offices. No decisions have been taken on that yet. It does not help the railway to talk down the railway and make up scare stories about ticket offices in front of constituents.

With regard to the Access for All programme, we are taking steps, as I mentioned, to allow better access for disabled people. The £370 million programme is designed to provide an obstacle-free route at 153 priority stations by 2015, and more than 70 of those projects have already been completed. To get the best value for money, that funding has been targeted at the busiest stations, although about one third of the stations were selected to ensure a fair geographical spread across the country.

To ensure that local or less busy stations are not forgotten—category 3, 4 or 5 stations are very important—we also offer train operators an annual fund to deliver smaller-scale access improvements. Since 2006, the Department for Transport has offered more than £25 million towards a total investment of more than £70 million for smaller-scale, locally focused access improvements at stations. More than 1,000 stations have benefited so far from a variety of new facilities, including accessible toilets, customer information systems, new ticket hall features and better signage and lighting. In the past year alone under this Government, 74 projects delivered improvements at 136 different stations.

[Mr Andrew Smith]

Will the Minister, with his officials, look at the proposals for relocating Oxford station that have been put forward by the Oxford Civic Society?

[Norman Baker]

I am certainly happy to look at those. We are increasingly devolving responsibility for transport matters down to local council level, and it is right to do that. People in Oxford are in a better position to know what is best for them than people in Westminster are, if I may say so. I would be interested in those proposals. There are, I think—I am speaking from memory—proposals to improve the situation at Oxford anyway by getting more trains running through it, and of course the electrification programme that the Government announced will hugely benefit Oxford and points west. We therefore have to ensure that we do not now spend money that will be rendered useless by further changes subsequently. However, I will be interested in proposals for Oxford. It is a station that I know quite well, not least because my mother-in-law lives there—not at the station, but nearby. [Laughter.] She is not the station mistress.

There is also the station commercial project facility, to which I referred. Up to £100 million of Network Rail funding has been set aside for commercially focused projects at stations through the station commercial project facility. That programme has been successful and a third and final tranche of bids are currently being considered for the fund. So far, the scheme has awarded about £82 million of funding to 38 individual schemes across the country, including improved car parking, better station retail and commercial facilities and new gate lines.

I should also mention perhaps the local sustainable transport fund, for which I am responsible. It is a brand-new fund that this Government created; £560 million is being distributed to improve local transport. That is an increase even above all the amalgamated pots of money that the previous Government had. It is an increase for local sustainable transport. Funding has been used across the country in certain locations where local councils have bid for it appropriately in order to improve rail facilities at local stations and, in at least one case, to reopen a station—at Stratford-on-Avon. That is another fund that is available for station improvements and it has been used for that purpose.

We are keen to improve cycle-rail integration—to improve cycle facilities at stations. That is important for the end-to-end journey. On 7 February, I announced £15 million of new funding for sustainable travel projects that will be hugely beneficial to communities and cyclists up and down England, helping to create jobs and reduce our carbon footprints while making cycling safer and more convenient.

As well as the £8 million for projects to enhance walking and cycling routes across England given to Sustrans, £7 million is being allocated through the cycle rail working group to improve integration between cycle and rail at stations. The position is that 30 cycle-rail schemes covering improvements at 141 stations will provide 7,500 new cycle spaces. Of that money, £145,000 is going to Letchworth, St Albans and Royston for almost 250 additional cycle spaces, and £500,000 is going towards a cycle hub at Cambridge with space for 3,000 bikes.

Network Rail has agreed to invest a further £7 million of the money that it has available in improving cycle facilities at stations, including safe routes and access. Part of that funding is being used to deliver innovative cycle hub schemes at Liverpool, Sheffield and York. The Department contributed £500,000 towards the first cycle hub, at Leeds, which incorporates secure cycle storage with cycle hire, retail and repair facilities. It is the first of its kind in the UK. In London, a hub at Waterloo will be completed before the Olympics, and Transport for London is working on plans for a similar scheme at London Victoria.

Train operating company accountability to passengers, which was the subject of the second question that my hon. Friend the Member for Stevenage raised, is being considered by Ministers—notably, my right hon. Friend the Minister of State, but also others—as part of the refranchising process. The discussions are ongoing, but the point that my hon. Friend made about ensuring that passengers are happy is well taken; it has been taken on board. It is something that we have also pursued in relation to community lines through the identification of community lines up and down the country.

Looped Blind Cords

Tuesday 17th April 2012 Westminster Hall

13:30

[Paul Flynn (Newport West) (Lab)]

It is a pleasure to serve under your chairmanship, Mr Hood.

Probably the worst bereavement anyone can suffer is the unexpected death of a child; it leaves a wound among their loved ones that will never heal—a wound made up of grief, regret and longing for a life that has been lost.

In January, my constituent, Tracey Ford, had just such a nightmare experience when she checked on her infant son, Joshua, whom she had put to bed only an hour before. She went to check on him because he always kicked all the blankets off, and she did not want him to be cold. She said:

“I remember walking into his room and it looked as if he was sitting up looking out of the window…I scooped him up in my arms and he was freezing cold and as limp as a ragdoll. Then I saw the cord from the window blind was wrapped around his neck. It was the worst moment of my life. My beautiful baby was so full of life and energy and I just knew he was gone.”

Such experiences are not common, but they are not rare either. At the time, Tracey Ford wrote to me, in February, four other children in the United Kingdom had died by becoming entangled in a window blind cord. The most vulnerable children are those who are the same age as Joshua, who was 23 months old. They are at that wonderful time of life when they are speaking well, doing more and running round. They are curious and playful, and if they see a looped cord hanging down, it is natural for them to play with it.

The number of such deaths in the United States in a 14-year period was 252. The most worrying thing about the 22 deaths that have occurred in the United Kingdom since 1999 is that the majority have occurred in the past two years. There has been great concern about the issue. To an extent, the industry has done conscientious work, and it has made efforts to make the cords safer. Work has also been done in the European Parliament, but the process of changing standards is slow. We have made progress in various areas to make sure that our children are at less risk. Sadly, however, this debate is necessary because there has been an increase in the number of deaths. Tracey Ford asked me with some feeling, “Why did nobody warn me? Why was I not told about this?” That cry could come from other parents in the same position.

[David Simpson (Upper Bann) (DUP)]

I congratulate the hon. Gentleman on obtaining the debate. It is a good debate to have, and our sympathy lies with the parents who have lost their children in these tragedies. Does he agree that the slow process that he describes is unacceptable? We were able to resolve the issue of electric sockets, which children put their fingers into, by capping them. Some time ago, three children died in an unused freezer, but it was possible to resolve that safety issue immediately by putting safety catches on freezers. Surely, in this day and age, progress on this issue should be faster.

[Paul Flynn]

I think that it should. We all recall the campaign about the tops of ballpoint pens, which some children swallowed and choked on, although, again, the cases were rare. There was a simple technical remedy. Similarly, there are many technical remedies to the problem of looped cords. There are alternatives that can be used, and the industry has acted, but it has acted slowly. Those involved are defensive about their profits and their competitive position, and we all understand that. However, there is no question but that the lives of innocent children are of supreme importance, and that is what should be considered.

I am grateful to my hon. Friend the Member for Ochil and South Perthshire (Gordon Banks) for his work on this issue, which he raised in 2008, and I am glad that I signed the early-day motion that he introduced at the time. He has run his own campaign on the issue, and he will speak about that in a moment.

We must, however, all ask ourselves whether we have done enough. If we had, the number of deaths would be diminishing, but it is not—it is going up. We must all look at the issue anew and decide which is the best way forward. Alternatives are available, but they are not seen as essential. It is still possible to go into a shop and be sold the most dangerous types of cord—the ones that have caused the most deaths. Alternatives are available, but is the industry pushing them in the way that it should?

I am extremely grateful, as I think all Members are, to the “Daybreak” television programme, which has taken up this case. I pay tribute to those involved and to my constituent, who has bravely come forward and said, “I want the legacy of my Joshua to be the hope that no other child will die in this way.” She is working for a situation in which every parent and grandparent will see the danger in their children’s bedrooms and nurseries and take action to remove it. The “Daybreak” programme is working with safety organisations to ensure that that message goes out.

The purpose of the debate is to make sure that people know about the danger posed by the cords in their homes, and it is the existing ones that pose the greatest danger. There are reckoned to be 250 million cords in British homes, and most of us would be astonished to find that there are perhaps a dozen cords in our own homes—they are almost universal, and they are all potential hazards for our children.

The lesson that we must learn is that we need publicity. We need more action from the Government. They have not been idle in these matters—indeed, they have been active—but they have a predilection for not introducing new regulations. I am not suggesting that we need legislation to tackle all our safety problems, and legislation may not be necessary now. However, the evidence staring us in the face is that what we have done in the past has not been adequate. We need a new impetus from the Government, who should publish information about the danger posed by these cords and, if necessary, put pressure on the industry to make sure these dangerous cords are no longer available and no longer on sale.

13:37

[Gordon Banks (Ochil and South Perthshire) (Lab)]

rose—

[Mr Jim Hood (in the Chair)]

Order. Has the hon. Gentleman the agreement of the hon. Member for Newport West (Paul Flynn) and the Minister to speak?

[Gordon Banks]

Yes. Thank you for allowing me to make a contribution, Mr Hood. I thank my hon. Friend the Member for Newport West (Paul Flynn) for securing the debate and adding his voice to those calling on the Government to do something of substance on this matter, and “substance” is the key word.

When the Minister makes his contribution, we will no doubt hear about the product safety awareness campaigns that have gone on in recent years. However, if they had worked, as my hon. Friend said, Joshua and other children would not have died in such a horrific way. I thank all those who have made an effort to tackle the issue, but it has been far too little, far too late.

In December last year, I prepared a brief for the former Minister with responsibility for consumer affairs at his request. That brief started by saying that 16 toddlers and babies had died in the UK since 1999, as a result of strangulation by dangerous looped blind cords. However, that brief is out of date, because the figure is now 22, and perhaps even more. There have been 11 deaths since 2010. Those 22 children were all loved by their mums and dads, brothers and sisters, and grannies and granddads, but they are dead because of window blinds. What are we doing to prevent such deaths? In my eyes, we are simply not doing enough.

I got involved in this matter in 2008 after Muireann McLaughlin, who lived in Menstrie in my constituency, died in a looped blind cord incident in her bedroom. I have since worked with her parents on the issue, but, four years later, these things are still happening.

Through my actions, the issue was brought to Parliament in a 2008 petition in which 3,500 people called for tighter controls on the manufacture of blinds. As my hon. Friend said, there were early-day motions in 2008, and three early-day motions in 2010 also highlighted the danger. I raised the issue with the Leader of the House in 2010, and on 12 March 2008—more or less four years ago, in this very place—I led a debate on the issue. Sadly, I could repeat that speech of four years ago today, because too little has changed. I have to ask why. I do not understand the reasons, although I shall try to contribute to their consideration.

My hon. Friend the Member for Newport West has done much in his speech to raise the general plight; but I want to focus on three things in the time that I have left that give some light for progress. First, I urge anyone who has not done so to read a communication from the European Commission, Health Canada and the Consumer Product Safety Commission in America, dated 15 June 2010. I assume that the Minister is conversant with it. It states that the CPSC is aware of 120 fatalities and 133 non-fatal incidents in the USA since 1999, that Health Canada has received reports of 28 strangulation deaths and 23 near strangulations since 1986 and that in seven European states 90 children visited emergency departments because of looped blind cord injuries in 2002. It goes on to refer to two UK deaths in 2010 and one in 2008—that of my constituent—one in the Netherlands in 2009, and two in Ireland, one in 2009 and one 2010. There were deaths in Germany as well; but there were more deaths in the UK. As I have said, the number stands at 22, and the poignant thing is that 11 of those have occurred since 2010, even after all the work that has been done.

The three organisations’ statement called for

“a swift and comprehensive process that concurrently eliminates the risk factors causing deaths and injuries from all types of corded window covering products”.

As far as I am concerned, that needs a complete product re-design, which is what I am calling for. That leads me on to the industry itself.

I fully grasp that, as my hon. Friend said, 250 million blinds with looped cords are in properties today. I acknowledge the dangers that they pose, but that is not a reason to do nothing about new products. I have spoken to the industry about designing out the need for cord operation. Bearing in mind that in 1969 we put a man on the moon, it is bizarre that 40 years later the brightest design minds in the western world cannot come up with a gearing mechanism to make cords unnecessary and allow operation via wands to be extended. I guarantee the Minister that, unless he kicks the industry up the backside, he and his successors will be back here in future years, answering questions about why they have not protected our children and grandchildren.

I recognise that there is an international aspect to this matter, with manufacturers located all round the world, but I thought that as the world got smaller and institutions worked together the safety of citizens was paramount. The industry will not change its blanket production methods unless it has to. I refer the Minister back to the letter from CPSC, Health Canada and the European Commission and urge him to use it as a basis for a complete product overhaul—not tinkering around the edges—so that all new products no longer have such a silent killing facility.

The Minister will no doubt talk about snap connectors and tie back cleats as safety products, and I shall consider each one in turn. A snap connector can work as long as it is in place, but when it keeps snapping with excess pressure, as it is designed to do, many people tie the two cords together. They omit the snap connector and, hey ho, they have an unsnappable looped cord. Manufacturers and installers have even said to me that they get repeated phone calls from customers saying that their blind is broken. When they go to the house, they find that the snap connector is broken. They fix or reassemble it, and they get the call again. Eventually, for many reasons, the snap connectors are done away with and the cords are tied together, resulting in a looped blind cord and a deadly, silent killing facility.

What about tie back cleats? Yes, they are fine if they are used and cords are wrapped around them; but we should get real. That does not happen all the time. What about when the cleats are removed for decoration and never put back in place again, for various reasons: “I forgot,” “I don’t have any kids,” “I don’t use it anyway.”? Again, there are dangerously hanging looped blind cords: that silent killer again.

Finally, I want to ask the Minister bluntly why his colleague the Under-Secretary of State for Business, Innovation and Skills, the hon. Member for North Norfolk (Norman Lamb), who has responsibility for consumer affairs, and a former Business, Innovation and Skills Minister have refused to meet me about this matter. The former BIS Minister, who is now the Secretary of State for Energy and Climate Change, gave that response in August 2010, and the Under-Secretary has repeated the position as recently as February this year. I am more than a little disappointed. In 2010, I asked the Leader of the House for a debate on the issue in Government time and his reply was rather embarrassing for him. He later had to backtrack from it. Sadly, the Government have got form on the issue and I cannot for the life of me understand why. If the Under-Secretary had met me in private, perhaps his colleague would not be here today in the public glare, having to explain the Government’s refusal to meet me.

I welcome the product safety information provided at the point of sale. I welcome the work done by the British Blind and Shutter Association and the Royal Society for the Prevention of Accidents to highlight the dangers of cords; but as I have said, that is simply not enough. Looped cords must be designed out of production, and it is interesting that the British Retail Consortium supports that call in a brief prepared for the debate today. Only when that danger is done away with can we begin to draw the matter to a close.

If the Minister does not move on the issue, he and his successors will find themselves back in such forums, explaining why children are still being killed by looped blind cords and why the Government are not protecting the most valuable asset that we have in this country—our children.

13:46

[The Minister of State, Department for Business, Innovation and Skills (Mr Mark Prisk)]

I congratulate the hon. Member for Newport West (Paul Flynn) on securing the debate and raising the profile of this issue. I think it is fair to say that many of our constituents are not aware of the scale of the problem. That is a valuable part of the debate. I thank him also for his heartfelt plea, on behalf of his constituent, echoed, rightly, by the work done over the years by the hon. Member for Ochil and South Perthshire (Gordon Banks), to raise the profile of the issue in industry as well as among constituents. On a personal note, I want to express my sincere condolences to the family of Joshua Wakeham. When we listen to the description given by the hon. Member for Newport West of the horror of finding a young family member in that appalling circumstance, it is difficult to know what to say. As the hon. Gentleman said, his constituent’s words, “Why did nobody warn me?” need to echo in our ears. I am not the Minister directly responsible, but I take that point seriously.

I will relay the request for a meeting, from the hon. Member for Ochil and South Perthshire, to my ministerial colleague. He is new to the office, and I do not know what circumstances may have meant he did not feel able to meet him; but he is a reasonable man, and I shall make sure that he is aware of the repeated requests that the hon. Gentleman makes on that point.

To turn to the core issues about new blinds, designs and consumer information, I shall try to set out information that will be helpful. It will move things along and perhaps update hon. Members about where we have got to; but it will also include key information that may help fellow hon. Members when they talk to their constituents about some of the issues behind the dreadful set of incidents in question.

Window blinds have been with us in their various guises for many years, but we have not been that familiar with the nature of the hazard, for younger children particularly, until more recently, perhaps with the 2004 incident, which I was certainly aware of. The hazard has obviously been persistent. We heard of the dreadful incident in the constituency of the hon. Member for Ochil and South Perthshire, involving Muireann McLaughlin, who I believe was just two years old. Then in February 2010 there were two deaths within five days: those of Lillian Bagnall-Lambe and Harrison Joyce, who was just three. The Royal Society for the Prevention of Accidents has highlighted the statistic on which most of us would perhaps rather not dwell, but on which we should reflect: 22 children have died in the way in question since 1999—two incidents involved curtain cords, but it is the same problem. Eleven of those died since 2010, which is an appalling rate. A comprehensive approach is needed, both to the tens of millions—potentially hundreds of millions—of cords, and, indeed, chains, that are in homes now, and to how to stop deaths in future, and design out the problem.

Let me say where the Department for Business, Innovation and Skills is coming from on this issue. Our role is to ensure that we set the legislative framework for consumer protection and for the broader issue of safety. As hon. Members will know, blinds are not regulated by specific safety legislation. They come under the General Product Safety Regulations 2005, which implement the broader directive within the EU. The question is how do we ensure that homes with those fitments can change them and have the information about changing them and using them. Furthermore, how do we ensure that future blinds and cords are designed in a way that reduces, if not removes altogether, the risk that has been described in this debate?

When the Department looked at the standards in the general product safety directive, it found them to be inadequate and in need of substantial amendment. The hon. Member for Ochil and South Perthshire was right to say that the matter needed not tinkering around the edges, but a fundamental change to the design standard, in a way that changes production design and development worldwide. One frustration is that trying to achieve that worldwide change in design, which is crucial if we are to root out the problem, has taken a lot longer than we would all like.

[Gordon Banks]

What would the Minister say to the British Blind and Shutter Association? In a meeting with us, it turned around and said, “If we knew how to do that, we would all be very rich men. We have been trying to do that for ages, and we have not come up with anything.” I do not think that there is a desire within the industry to do what my hon. Friend and I want and what, I think, the Minister wants. The industry needs a kick up the backside from the Minister.

[Mr Prisk]

Sometimes that works. Sometimes a persistent unwillingness not to take no for an answer is the same, but we may be talking about the same approach. I will perhaps use less vernacular language on this occasion. We now expect the European standard to be in place next year. In fact, I am reasonably confident—enough to put it on the record—that we will get it next year. We had pushed for it to happen this year. Importantly, it will ensure that internal blinds with exposed cords will either not be able to form a loop or they will have an integrated safety device to protect against the risk of strangulation.

In addition, the standard will set out that clear and obvious safety information has to be provided at the point of sale on the packaging of the product, on the product itself and in the accompanying instructions for use. There will also be new requirements for the safety devices intended to be retrofitted to existing blinds. I will touch on the issue of snap connectors in a moment.

We are working with business, but we must ensure that we do not just wait for that standard to be in place. Over the next couple of months, with the help of the BBSA, we will write to 6,500 businesses—manufacturers, designers, retailers and installers—to ensure that we do not wait for that deadline to come in and then discuss what we need to do about it; we need to start pushing people in that direction now. I accept that they will not all be willing to adopt one method until they see the final detail, but that is no excuse for doing nothing in the meantime. What we can do is to push and accelerate that progress to ensure that UK industry is ready ahead of time. The redesign of products to remove the reliance on looped cords and chains is essential. We must try to ensure that we get that accepted—well, it is accepted—and developed.

The hon. Member for Ochil and South Perthshire mentioned the retailers who are a crucial part of the supply chain. We have worked with RoSPA, the Child Accident Prevention Trust and the Trading Standards Institute because we need to inform retailers and their staff that they should be able to source safer blinds, which would be a simple thing for the retailers to undertake, and I welcome the remarks made by the British Retail Consortium. We also need to ensure that parents, particularly those who may be expectant or with little ones, have information at the point at which they are purchasing the product. We have worked with the industry to get the retailers in and to get those matters under way, and we are planning to have a further summit later this year.

The hon. Gentleman mentioned the matter of the joint letter of 15 June 2010 involving the Europeans, the Canadians and the Americans. The key is getting the various standards organisations to adopt a consistent and clear approach that the whole industry can adopt. The decision to adopt the European standard from next year will help to accelerate that, and we are working hard on that issue. To get that fundamental shift in the whole industry, we need to demonstrate—I think that we are nearly there—that we have a clear global change in standards. In that way, we will remove the problem wherever the products are made.

[Paul Flynn]

rose—

[Mr Prisk]

I will give way. I did want to turn to those blinds that are currently in use, which is obviously a big issue.

[Paul Flynn]

I am grateful to the Minister for his reasonable response on this issue. We all know from past experience that industry is reluctant to change. Usually that is for good reason. If a company has to retool, that means expense and problems that it would normally seek to avoid. Perhaps we could give the industry some incentive. For example, companies could become more profitable if they were selling cords that were guaranteed to be safer than the ones from the past. Perhaps the Government could give them some encouragement in that regard so that we can have blinds marketed that avoid the use of a loop and that are inherently much safer.

[Mr Prisk]

I understand that point. My inclination is that the industry, whichever industry it is, should be willing to do this without us having to dangle in front of it tax relief or something of that nature. I am not dismissing the hon. Gentleman’s point, but I suspect that the clarity of the regulatory framework will tip over the action. There is no reason why, in the interim, we should not be persistent in challenging the problem.

[Gordon Banks]

rose—

[Mr Prisk]

I will give way very briefly. I do want to get on to the broader points, because there are some important safety issues that I want to raise.

[Gordon Banks]

Let me go back to the point about retailers. A few minutes ago, the Minister mentioned trading standards. May I say that I sat in a fatal accident inquiry and heard trading standards officers say that they did not know how many blind manufacturers, installers or retailers there were in their patch and that they did not go and inspect them and that they did not know anything about such workplaces? Trading standards officers have a big role to play in any changes, and they need to be empowered and financed in a way that enables them to enforce what the Minister wants to see happen.

[Mr Prisk]

That is a good point, and I will ensure that I bring it to the attention of the Consumer Affairs Minister because he may want to raise it directly with the individuals concerned, including those involved in trading standards.

Let me turn to the crucial issue, which affects many households, of the blinds already in use. We respect the fact that parents cannot watch their children every minute of every day. As part of action in this regard, it is important to make available simple guidance that people can follow to help prevent some of the accidents that we have talked about. I am talking about moving cots away from windows where blinds are fitted; assessing each blind to ensure that the cord or chain is not within reach; and fitting the safety devices—there are strengths and weaknesses with cleats and so on that we need to be aware of, but routine use of such devices can reduce the number of accidents. These simple actions matter as does ensuring that the issue is promoted. Let me flag up the fact that both the BBSA and RoSPA have distributed more than 750,000 safety brochures and packs, and we have been willing over the last year to support them in their promotion, particularly the safe at home programme. Alongside the work of the retailers and the change of the design of future products, it is important that we send out a consistent message. I strongly applaud not only the safety organisations but hon. Members who have contributed to this debate and the media in helping to get the message across that there are some basic, simple preventive steps that will make a difference.

I am aware of time, and I am grateful to both hon. Members for raising the issue. As a Government, we feel that we must tackle the design of the new blinds and promote the safe use of existing blinds as a combined effort. More needs to be done and the pace needs to be accelerated. I will certainly take back all the concerns that have been raised today to my colleague, the consumer affairs Minister.

Question put and agreed to.

13:59

Sitting adjourned.