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Oral Answers to Questions
(11 years ago)
Commons ChamberRead Full debate Read Hansard Text Read Debate Ministerial Extracts
Caroline Dinenage (Gosport) (Con)
1. What steps he is taking to ensure that all pupils attain basic levels of literacy and mathematics before leaving school.
Paul Uppal (Wolverhampton South West) (Con)
5. What steps he is taking to ensure that all pupils attain basic levels of literacy and mathematics before leaving school.
Jonathan Lord (Woking) (Con)
15. What steps he is taking to ensure that all pupils attain basic levels of literacy and mathematics before leaving school.
The Secretary of State for Education (Michael Gove)
Before I answer the questions, may I say on behalf of the House that you, Mr Speaker, would want us to pass on our best wishes to the Chairman of the Select Committee on Education, my hon. Friend the Member for Beverley and Holderness (Mr Stuart), who has recently suffered an accident from which he is slowly recovering. We all miss him. He was a fantastic constituency MP and great scrutineer of education [Hon. Members: “He still is!”] He still is, and we look forward to him being restored to full health.
The new national curriculum includes more demanding content in English and mathematics. In line with high-performing south-east Asian countries, mathematics will have more emphasis on arithmetic, fractions and decimals. There will be a new professional development programme for mathematics teachers at key stage 3, which will help them teach fractions more effectively, with robust evaluation of the results. We are, of course, also reforming GCSEs and making changes to nursery education.
Caroline Dinenage
Given the evidence that parents who have lower levels of literacy and numeracy can be motivated to improve themselves in order to support their own children’s learning, will the Secretary of State explain what measures are being taken to support family learning programmes?
Michael Gove
It is absolutely right that if parents are given the opportunity to play a part in their child’s education and if they are given additional confidence in their own grasp of literacy and numeracy, the whole family can benefit from it. It is a commitment of myself and the Under-Secretary of State for Skills, my hon. Friend the Member for West Suffolk (Matthew Hancock), who has responsibility for skills and adult learning, to make sure that family learning programmes can be supported as effectively as possible.
Paul Uppal
A recent study has found that just under a quarter of residents in Wolverhampton have no formal qualifications, which is double the national average. With that in mind, will my right hon. Friend make a commitment to ensure that learners of all ages have the necessary skills and qualifications to enter employment and bridge the skills gap?
Michael Gove
My hon. Friend is absolutely right. We need to make sure, of course, that we intervene early to ensure that the next generation succeeds at a higher level than ever before, but we also need to ensure that older people who, for whatever reason, failed to benefit from the education on offer during their time, are given the chance to re-engage with the world of education to improve their literacy and numeracy.
Jonathan Lord
Last year, the CBI reported that two thirds of businesses were complaining that too many school leavers were struggling with basic literacy and numeracy and were unable to use a computer properly. Does my right hon. Friend agree that it is unacceptable to ask our employers to set up remedial classes in these most core basic skills?
Michael Gove
My hon. Friend is absolutely right. No young person can confidently take their place in the world of work unless they are secure in literacy and numeracy. That means having secured a GCSE equivalent or better.
Lucy Powell (Manchester Central) (Lab/Co-op)
Does the Secretary of State agree that teaching assistants play a vital role in raising standards in numeracy and literacy in many of our schools, especially those facing the most challenging circumstances? Can he therefore assure me that teaching assistants will not be the next target of his ever more regressive education policy?
Michael Gove
The only target for our education policy is to ensure that all children have a chance to succeed. Of course it is the case that teaching assistants and others can play a part, but the single most important person is the teacher. We need to make sure that the changes we have made to attract more talented people into teaching, building on the work done under the last Labour Government, continues.
Alison Seabeck (Plymouth, Moor View) (Lab)
If the Secretary of State is to ensure that children attain basic levels in mathematics and since he is clearly in need of enough well-trained teachers to do the job, will he explain to my constituent, Stephanie, why she is unable to train as a maths teacher either through School Direct or the postgraduate certificate in education? With initial teacher training having moved out of higher education into schools, there is no capacity in Plymouth, so she has the choice of one school, which can take only one student. Will the right hon. Gentleman explain that?
Michael Gove
I will be happy to do everything possible to help the hon. Lady’s constituent to be a maths teacher. We should encourage that aspiration among all people, but it is the case that School Direct, the new programme that allows graduates to train in schools, has been hugely popular. It is also the case that a higher proportion of people with great degrees in STEM subjects—science, technology, engineering and maths—are choosing to enter teaching.
Andrew Gwynne (Denton and Reddish) (Lab)
With the Secretary of State having given his support in principle to Labour’s concept of a technical baccalaureate, will he also support Labour’s requirement to ensure that, as part of the awarding of the tech bacc qualification, all students will have to study English and maths as a requirement?
Michael Gove
It is certainly the case—I am glad there is consensus on this from both Front-Bench teams—that students who have not secured a GCSE pass at English or maths at the age of 16 must carry on studying until they secure it. Anyone who wants to apply for the technical baccalaureate—a new and explicitly demanding measure of achievement—will have to go beyond that and secure a level 3 qualification, a technical term, in mathematics and produce an extended piece of writing showing that they command the literacy skills necessary for the modern world of work.
Mr David Ruffley (Bury St Edmunds) (Con)
The poet Ted Hughes said of children:
“When they know by heart fifteen pages of Robert Frost”
or
“Swift’s Modest Proposal… They have reefs, for the life of language to build and breed around. A ‘globe of precepts’ and a great sheet anchor in the maelstrom of linguistic turbulence”.
In the light of those words from the late poet laureate, will my right hon. Friend confirm—[Interruption.]
Mr Speaker
Order. We have heard the words of Hughes, but I want to hear the words of Ruffley.
Mr Ruffley
Members of the Labour party, the enemies of rigour, want to shout down any defence of standards. Will my right hon. Friend please confirm that he will ensure that there is a role for rote learning in the schools of tomorrow?
Michael Gove
It was Mario Cuomo, the governor of New York, who said that we campaign in poetry but we govern in prose. This Government, however, are governing in poetic terms—heroic couplets, in particular. With the help of Andrew Motion, another distinguished former poet laureate, we have organised a competition to ensure that children learn verse by heart and that, for all the days of their lives, the great works of English literature can be there, ready to be recalled and to illuminate every corner of their minds and lives.
Helen Goodman (Bishop Auckland) (Lab)
I am amazed that the Secretary of State thinks he can produce a nation of six-year-olds all of whom can spell Tuesday and know that there are two ways of spelling pear/pair. I think that even Hansard will have some problems with that! Is the Secretary of State not aware that pushing children to do things that they are not ready to do is totally counter-productive? In most European countries, they are not even at school at the age of six. Does the right hon. Gentleman not know that, according to the results of a UNICEF study, the one feeling that British seven-year-olds understood was how it felt to fail?
Michael Gove
I feel sorry for some seven-year-olds because they will have lived through years of Labour government when failure was all around them, but at last there is a Government who have high expectations for every child. I am sorry that the spirit of consensus that has prevailed so far has been shattered by the hon. Lady, because I had assumed that Labour was committed to ensuring that children in their earliest years had an opportunity to enjoy the very best teaching. It seems to me that it is not just in east Durham that there is a poverty of aspiration on the part of the Labour party.
Greg Mulholland (Leeds North West) (LD)
2. What recent assessment he has made of the adequacy of training for teachers and school staff on (a) autism and (b) fabricated or induced illness by carers.
The Parliamentary Under-Secretary of State for Education (Mr Edward Timpson)
All teachers are teachers of children with special educational needs, including autism. It is for schools themselves to decide what training their staff require to meet their pupils’ needs. We have contracted the Autism Education Trust to provide training for education staff, and it is the responsibility of local safeguarding children boards to monitor and evaluate the effectiveness of local training.
Greg Mulholland
Parents seeking a diagnosis of autism can be, and in some cases have been, subjected to unjustified child protection inquiries. Does the Minister agree that we need to look at the guidelines on fabricated and induced illness, and will he meet a family in my constituency who have suffered as a result of that very problem?
Mr Timpson
My hon. Friend is right to emphasise the value to teachers of being aware of the needs of children with autism. That is why we are funding the Autism Education Trust, and why we are continuing to support the national scholarship scheme, which has elements relating to special educational needs, and the training of more than 10,000 special educational needs co-ordinators as qualified teachers. However, my hon. Friend is right to continue to think about how we can improve the guidelines that are made available in relation to both autism and fabricated or induced illness. The National Institute for Health and Clinical Excellence has issued such guidelines, but I should be happy to meet my hon. Friend to discuss them further and see what more we can do.
Mr David Burrowes (Enfield, Southgate) (Con)
Has the Minister had an opportunity to attend a school that is participating in the Anderson Foundation schools challenge, which is encouraging pupils and teachers to complete 50 tasks to celebrate the 50 years in which the National Autistic Society has been raising awareness of autism?
Mr Timpson
I am aware of that schools challenge. I suspect that my hon. Friend’s question constitutes an invitation to visit Enfield, Southgate on some future date. I should be happy to learn more about the work that is taking place to support the National Autistic Society and many other autism charities for the great work they do, and I look forward to learning more with my hon. Friend’s support.
Gavin Williamson (South Staffordshire) (Con)
3. What assessment he has made of the level of education funding received by children in South Staffordshire; and if he will make a statement.
The Minister for Schools (Mr David Laws)
In 2013-14, the Department for Education allocated £4,310 per pupil for pupils in mainstream schools in Staffordshire, plus an additional £900 for each deprived pupil through the pupil premium.
Gavin Williamson
Our schools in South Staffordshire receive on average £695 less than schools in neighbouring Wolverhampton. Many of my constituents think that that is grossly unfair and want it to be rebalanced. What action is my right hon. Friend taking to rebalance it to ensure we get a fair deal for pupils in Staffordshire?
Mr Laws
My hon. Friend is absolutely right that the last Government left us a funding formula for schools that allocates money across the country in an unfair and irrational way. That is why we intend to introduce a national funding formula, and in the meantime we are funding £20 million more to Staffordshire through the pupil premium.
Mr Speaker
Order. The question covered Staffordshire, but not Worcestershire. We can let in Mr Fabricant.
Michael Fabricant
As you well know, Mr Speaker, Lichfield was, I like to think, the original capital of Staffordshire, and it was certainly the capital of Mercia and was the first place—even before Canterbury—to have an archbishop, but we digress. I am very relieved to hear that the funding formula, which is so unfair, will be addressed, but we heard that long ago from the Labour party when it was in government, so can my right hon. Friend the Minister give some indication of when it will actually happen?
Graham Evans (Weaver Vale) (Con)
4. What steps he is taking to remove underperforming teachers from the classroom.
The Secretary of State for Education (Michael Gove)
We have introduced new appraisal and capability arrangements, which should make it easier for governing bodies and head teachers to tackle underperformance. These procedures are shorter and less complex than the previous ones, and make it possible, in some cases, for schools to dismiss incompetent teachers in about a term.
Graham Evans
I thank my right hon. Friend for that answer. What plans does his Department have to assess teachers, to prevent them from reaching that critical stage in the first place? Does he agree that failure in schools is often one of leadership and management, and is not necessarily the fault of the individual teachers?
Michael Gove
My hon. Friend makes a characteristically acute point. The sharper Ofsted framework, with its greater emphasis on teaching, leadership and, critically, performance management, should ensure that, although these procedures will take less time to execute, they need not be used in many circumstances because heads will have done exactly as he suggests, in that they will have moved quickly to deal with underperformance.
Mr Barry Sheerman (Huddersfield) (Lab/Co-op)
I beg the Secretary of State to stop giving the impression that he believes that all teachers are incompetent. There are some incompetent teachers, and they should be guided and managed properly, but too many people—both parents and teachers—think he is against teachers. Please will he start working with them, have confidence in them and energise them, in which case children and parents will be very happy?
Michael Gove
Again, I am grateful to the hon. Gentleman for giving me an opportunity to repeat in this House what I say in every speech I give, which is that we are uniquely fortunate to have the best generation of young teachers in our schools, and that standards are higher to a significant extent because of the commitment they make. I am also delighted that so many changes that are happening in education—from the establishment of free schools to the way in which teacher training is changing—are being driven by teachers, who are working with us in a spirit of collaboration.
Mr Julian Brazier (Canterbury) (Con)
While welcoming my right hon. Friend’s moves to give head teachers more power in this area, may I ask what he is doing, by way of balance, to attract the very brightest and best into the profession?
Michael Gove
My hon. Friend makes a very important point. He is committed to helping ensure that there are more mathematicians of ability teaching in our schools, and as a result of the changes we have made, including working with organisations such as the Institute of Physics and the Royal Society of Chemistry, more students with top degrees in science and mathematics subjects are now entering our schools, thus transforming the way in which those vital subjects are taught.
Ms Gisela Stuart (Birmingham, Edgbaston) (Lab)
Heads used to turn to the local education authorities for support in dealing with underperforming teachers. Under the Secretary of State’s new regime, who would he expect academies and free schools to turn to?
Michael Gove
As the hon. Lady knows, the Birmingham authority does not have a particularly good record, whether under Labour or the coalition, in providing an appropriate level of challenge. In Birmingham, it is head teachers who are providing the opportunity—people like Sir Christopher Stone are doing a fantastic job in making sure other schools improve—and the best school in Birmingham, Perry Beeches, has now opened a free school, which is showing the way. If we empower teachers in the spirit in which the hon. Member for Huddersfield (Mr Sheerman) suggests, we can do a lot more to raise standards than we ever did when we empowered bureaucrats.
Paul Blomfield (Sheffield Central) (Lab)
6. What plans he has for child care and early intervention provision; and if he will make a statement.
The Parliamentary Under-Secretary of State for Education (Mr Edward Timpson)
There is consensus across the House that early intervention is both effective and necessary, and the Government are determined to build on that, with the Early Intervention Foundation, formally launched on 15 April, playing an important role in gathering information about what works. We already know how powerful high-quality education and child care can be as an early intervention tool, which is why we are extending early learning for two-year-olds from low-income families.
Paul Blomfield
In Education questions on 4 March, I asked the Secretary of State about the cut of 27%, or £6.8 million, to Sheffield’s early intervention grant, forcing the council to make deep cuts in early years provision. In his reply, he cited a grant of £25.2 million, describing it as an increase of 3.9%. I have since confirmed the position with council officers, who said that they could only—I quote—
“assume the Minister made an error on this. The £25.2 million refers to the current year. The figure of £6.8 million EIG reduction was the figure provided by DCLG. The cut in fact was £7.4 million when the Government confirmed the Council funding for 2013.”
Will the Secretary of State apologise and accept that he was in error and that my figures were right and, more importantly, apologise to the parents of Sheffield whose child care is being threatened?
Mr Timpson
The hon. Gentleman will know that the Secretary of State is always delighted to speak to people and professionals in Sheffield to see how the early intervention grant, which is rising from £2.3 billion to £2.5 billion, can be best spent in the Sheffield area. I am sure that is a discussion he will be happy to have.
Paul Maynard (Blackpool North and Cleveleys) (Con)
In Blackpool North and Cleveleys, we eagerly anticipate the new statutory duty that will see 15 hours of early learning made available to two-year-olds from low-income backgrounds. Can the Minister speculate on the impact that should have on achievement levels for primary pupils in areas such as Blackpool and Cleveleys, which are deprived seaside towns?
Mr Timpson
I am grateful to my hon. Friend, who highlights a key component of our early years intervention programme, which will see a rise from 20% to 40% in the number of two-year-olds from low-income families benefiting from the statutory duty. We anticipate that it will ensure that they get high quality care at a much younger age so that their future outcomes will be much more positive. That can only be a good thing for the people and children of Blackpool and across the country.
Meg Hillier (Hackney South and Shoreditch) (Lab/Co-op)
First we had the pile ’em high, teach ’em cheap approach to child care, increasing ratios for child minders. Today, the children’s Minister was reported talking about chaos in nurseries for two-year-olds. Meanwhile, in my constituency, parents wait two and a half years for a place for their baby. What are the Government doing to increase the supply of child care for working parents?
Mr Timpson
I think what the hon. Lady said towards the end of her question is exactly why we need to push hard to create a high-quality child care system that is both affordable and flexible. Less than a third of nurseries currently employ graduate teachers, yet the importance of qualified staff is clear; it has a direct link to the quality of child care and therefore outcomes for children. The hon. Lady should welcome the moves we are making to increase flexibility and improve quality and affordability, so that more parents can have better child care.
Miss Anne McIntosh (Thirsk and Malton) (Con)
Will my hon. Friend look at the early intervention situation for looked-after children, in particular the 28-day deadline that is being piloted in north Yorkshire? Will he give the House an assurance that where there are special circumstances, the 28-day rule will not be applied?
Mr Timpson
I will happily look at the point my hon. Friend raises. As we have done with the new “Working Together” statutory guidance document, we want to make sure that all children, whether they are in need or whether they require protection, are given the earliest possible help, so that the problems in their lives do not fester longer than they need to, but I am happy to look at what she says.
Mrs Sharon Hodgson (Washington and Sunderland West) (Lab)
I hope that Ministers, especially the Minister responsible for child care, will set an example of the behaviour they clearly want to see from the nation’s toddlers, and that they will sit silently and listen and then answer politely. Professor Cathy Nutbrown is the latest expert commissioned by the Government to slam the Minister for her plans to loosen adult to child ratios, saying that they will
“shake the foundations of quality provision for young children.”
I know that the child care Minister has a touch of the Iron Lady about her—she might take that as a compliment—but will she ever be for turning on that? Will she or the Government ever listen to the experts they have commissioned and the tens of thousands of professionals and parents who disagree with her?
Mr Timpson
What I do know is that my hon. Friend is used to a maelstrom of linguistic turbulence coming from the Opposition, but I doubt whether that will turn her from her strong and well-evidenced reform programme, which ensures that ratios, which are not mandatory but which are, along with staff salaries, the lowest in Europe, are going to work towards our having higher quality child care which is more flexible and which parents can afford. The hon. Lady should welcome that and I hope she will listen attentively when the Minister with responsibility for child care makes that case in the future.
Mr Gareth Thomas (Harrow West) (Lab/Co-op)
7. What recent assessment he has made of the school priority building programme; and if he will make a statement.
Kelvin Hopkins (Luton North) (Lab)
17. What recent assessment he has made of the school priority building programme; and if he will make a statement.
The Minister for Schools (Mr David Laws)
We are making good progress in delivering the first schools in the priority school building programme. Unlike previous programmes, we are tackling schools with the greatest needs first—those in the very worst condition and special schools. The first contracts for these schools have been let and building work is to start in the next few weeks.
Mr Thomas
In July last year Harrow council wrote to the Education Funding Agency seeking to secure some resources, in part from the priority school building programme, for the rebuilding and expansion of Vaughan and Marlborough schools in my constituency. Given that as of Friday, almost 10 months on, Harrow council had not received a reply to the letter, will the Minister agree to meet me and representatives from the schools to discuss how we might move the situation forward for Vaughan and Marlborough schools and secure the resources to facilitate their expansion?
Mr Laws
I note that Harrow council has welcomed the fact that eight of its schools are within the priority school building programme, but I can only apologise to the hon. Gentleman that the local council has not had a response from the EFA after such a long period. That is clearly not acceptable. I believe, though, that the council has met EFA officials on a couple of occasions. I can tell the hon. Gentleman that a letter will be going out this week from the EFA, and I am delighted to meet him if he would like to do so, after he has seen the contents of that letter.
Kelvin Hopkins
The Minister may be aware that Luton has one of the highest proportions of school-age children in the whole country. Indeed, at one time a few years ago my constituency had the highest number of school-age children as a proportion. Will the Government continue to give serious consideration to Luton as a priority area, given that several of our schools are still bursting at the seams?
Mr Laws
Yes, Luton is a priority area. Some of the first batches of the privately financed priority schools will be in the hon. Gentleman’s area and we expect those, after proper approval, to be released this spring. We are currently carrying out a survey of the entire school estate and later this year, when we have that evidence, we will be able to prioritise in a sensible way future allocations of capital.
Neil Carmichael (Stroud) (Con)
I thank the Minister and the Department for enabling a much-needed and long awaited investment in one of my schools, Marling school in my constituency. Does he agree that this is an example of a paced and sensible capital investment programme?
Mr Philip Hollobone (Kettering) (Con)
Will the Minister join me in celebrating the fact that Kettering Science academy and Kettering Buccleuch academy both have a complete set of brand, spanking new buildings and that, together with the dynamic leadership of the heads and sponsoring organisations, this will help transform two of the worst performing schools in Kettering into two of the very best?
Kevin Brennan (Cardiff West) (Lab)
Thousands of parents are desperately anxious that their child still has no place at primary school next year, and others will be taught in larger classes further away from home. Will the Minister explain to those worried mums and dads why the Government are building two out of five of their flagship free schools in areas where there are already enough places?
Mr Laws
I am delighted to explain the priority school building programme. Unlike its predecessor programme, it prioritises those schools in the worst need, and I am proud that it is doing so, in contrast to the previous scheme, Building Schools for the Future, which did not do so. On the issue of primary places, I caution the hon. Gentleman not to lecture this Government when his Government ignored the warnings of the Office for National Statistics and eliminated 200,000 primary school places.
Andrew Rosindell (Romford) (Con)
8. What steps he is taking to ensure that all pupils gain a chronological understanding of British history.
Mr David Amess (Southend West) (Con)
11. What steps he is taking to ensure that all pupils gain a chronological understanding of British history.
The Secretary of State for Education (Michael Gove)
We believe that all pupils should be taught about the events that have shaped the history of these islands, and their understanding of that history is best developed when it is taught within a robust chronological framework. That is why we have published proposals for a new curriculum. Consultation on the draft closed on 16 April and we hope to publish a final version in the autumn.
Andrew Rosindell
The country will thank the Secretary of State for at last restoring British history to our schools, but will he also ensure that our pupils are taught about the proud history of our Commonwealth, the former British empire, and also the British territories?
Michael Gove
On the eve of St George’s day, my hon. Friend makes an important point, and it is the case that the new draft national history curriculum explains how Britain has interacted with the rest of the world, from Wolfe’s victory over Montcalm on the Plains of Abraham, which ensured that Canada could remain British, to the influence of Britain on India. It is also the case that the period right up to the 20th century and the process of decolonisation that brought Jinnah, Nehru, Kenyatta and Nkrumah to power is in the national curriculum in detail that did not exist before.
Mr Amess
Does my right hon. Friend welcome the comments of leading historians Niall Ferguson, David Starkey and Antony Beevor concerning his plans for the history curriculum, who all recognise that unless our children have a real understanding of British history, they cannot possibly know where we have been, where we are now, or where we might be heading in the future?
Michael Gove
I am absolutely delighted that high profile historians, along with academics from Cambridge, such as David Abulafia, Professor Robert Tombs and Professor Jonathan Clark, one of the most distinguished contemporary historians of our time, Professor Jeremy Black at the university of Exeter and others have said that our direction of travel is right, but I want to make sure that there is the maximum possible consensus behind this necessary reform.
David Wright (Telford) (Lab)
I support the chronological teaching of British history. Is he sure that the split between primary and secondary is correct in the date lines that he is talking about? Will he ensure that we are not just talking about the dates of kings and queens, but about the history of working people in this country?
Michael Gove
I absolutely agree that we need to make sure that the division between primary and secondary is appropriate for both. As for the history of working people, this is the first draft of the national history curriculum that mentions not only the role of Annie Besant, who helped to lead the match girls’ strike in east London, but also the Tolpuddle Martyrs. I hope that the hon. Gentleman, like me, would celebrate an understanding of labour history alongside economic, political and social history.
Bill Esterson (Sefton Central) (Lab)
Thirty A-level students from my constituency visited Parliament with their teachers recently, and they told me that they need a broad history curriculum for later on in life. They also told me that if the Secretary of State goes ahead with the kind of proposals that have been mentioned in the press recently, that will not be possible for them and he will see a sharp drop-off in the numbers taking A-level history.
Michael Gove
I am grateful for what the hon. Gentleman says, but I am reassured by the enthusiasm that has been shown by parents and students for a deeper immersion in British history. It is sadly the case that an insufficient number of students leave school with a proper knowledge of Britain’s past. I want them to know about the achievements of heroes and heroines so that they can take pride in what these islands have achieved.
Sir Gerald Howarth (Aldershot) (Con)
Pursuant to that answer, may I invite my right hon. Friend to tell the nation how important it is that our children understand those great heroes of the past? For example, Admiral Sir Thomas Cochrane, a former Member of this House for this notable city of Westminster, not only captured 53 ships of the French flag when he commanded HMS Speedy, but went on to liberate Chile from Spanish rule and Brazil from Portuguese rule. As a result, in both those countries there is not a child who has not heard of Admiral Sir Thomas Cochrane, while there is not a child in this country who has.
Mr Speaker
I had a feeling that the hon. Gentleman might want an Adjournment debate on the subject—and then I realised that he has had one.
Michael Gove
Thank you, Mr Speaker. There are a number of British maritime heroes, and indeed heroines, of whom we should know more, from Grace Darling to Thomas Cochrane, and from Nelson to Mountbatten. We should be aware of the role that the Royal Navy, the merchant navy and the Royal National Lifeboat Institution have played in ensuring that people are safe on the high seas and, critically, that nations can enjoy liberty now in the same way we have enjoyed it for generations.
Hugh Bayley (York Central) (Lab)
9. What plans he has for the regulatory framework for under-fives provision.
The Parliamentary Under-Secretary of State for Education (Elizabeth Truss)
We are reforming the regulations for providers for under-fives in order to give greater freedom and flexibility to high-quality providers. New childminder agencies will provide additional support for childminders and more choice for parents. We are reforming the role of local authorities to focus more on disadvantaged children. On Friday, Michael Wilshaw announced that early years inspections will be improved through greater monitoring and that Ofsted will introduce clearer reporting on the qualifications of child care professionals.
Hugh Bayley
Those are laudable but contradictory ends. Last week the owner of a Montessori nursery in York told me that they believe that the dilution of staff-child ratios will lead to a two-tier system and result in fewer staff and lower standards for children from low-income households, yet we know that those are the children who need under-five provision most. What will the Government do to ensure that those children do not fall behind even before they start school?
Elizabeth Truss
At present, it is a sad fact that 33% of children arrive at school without the requisite communication and language skills to take part in school education. What Sir Michael Wilshaw has said, as well as Andreas Schleicher of the OECD, is that the most important factor in early education is the qualifications of staff. At the moment, only a third of nurseries have a teacher-led structure. Good providers, such as the Durand academy, provide quality, structured learning from age three, which really benefits children later on. We want to give more high-quality providers that flexibility, but we will do so only where they hire highly qualified staff.
Damian Hinds (East Hampshire) (Con)
In the early years, all the evidence suggests that structured group activities led by qualified graduates tend to lead to better education outcomes, so may I encourage the Minister to stick to her guns and continue her drive to improve standards in our nurseries?
Elizabeth Truss
I thank my hon. Friend for his question. When we look at all the evidence from countries such as France, where there are much higher salaries and qualifications in the early years, we see higher quality provision, particularly for the under-threes. Every other country in Europe, including Ireland and Scotland, has higher child-staff ratios and higher staff salaries than we do.
Peter Luff (Mid Worcestershire) (Con)
10. When he will announce the structure and content of the design and technology curriculum; and if he will make a statement.
The Parliamentary Under-Secretary of State for Education (Elizabeth Truss)
Following the national curriculum consultation period, which closed on 16 April, we are considering the responses received. We have been engaging with leading figures in industry, such as Dick Olver and Sir James Dyson, schools and academia to ensure that we have world-class design and technology education. We are also committed to providing a curriculum that ensures children receive high-quality cookery teaching and understand the importance of a healthy lifestyle.
Peter Luff
I congratulate my hon. Friend on the thoughtful and intelligent way she has engaged with the Royal Academy of Engineering and the Design and Technology Association, and with Dick Olver, Sir James Dyson and others, in considering the new design and technology curriculum. May I encourage her to bring forward a curriculum for the 21st century that inspires young people, particularly girls, to understand the role of science, technology and engineering in solving the real problems of the modern world, environmental, social and economic?
Elizabeth Truss
I thank my hon. Friend for his question and for his excellent contribution to the Westminster Hall debate we had on this subject. I would also like to thank him for his views on the maths, science and computing curriculum. We are now working on ensuring that design and technology is more closely integrated with those curricula and that there is an inspiring technological education that crosses many different industry types and gives schools flexibility to teach design and technology in the best way for the next generation.
Tristram Hunt (Stoke-on-Trent Central) (Lab)
The Opposition believe in academic excellence, but we also believe in a syllabus that reflects the demands of the 21st century. Does the Minister share my concern about comments from the CBI last week, which damned the new design and technology curriculum as
“out of step with the needs of a modern economy.”
It stated that the curriculum
“lacks academic and technical rigour”
and
“risks reinforcing existing prejudices about applied subjects being second-rate.”
When will we have a proper focus from the Government on a rigorous and relevant curriculum?
Elizabeth Truss
I congratulate the hon. Gentleman on his new position on the Front Bench. It is sad that we did not get to hear his views on the history curriculum earlier in the debate, but we will no doubt hear them at a later stage.
The hon. Gentleman makes a very important point about the future of British manufacturing and engineering. We are working with leading figures in the industry to make sure that we have a world-leading curriculum that is in line with what we have in computing, physics and mathematics. I would also point to the technical baccalaureate that we are introducing, which will, for the first time in this country, provide a rigorous, high-quality technical education that is truly aspirational and will encourage many more young people to study subjects such as engineering.
Duncan Hames (Chippenham) (LD)
On a recent visit to the Corsham school, I saw the “making room”, which is staffed by a professional artist and is available to all curriculum areas. Ofsted says that it takes activity begun in the classroom and turns it into imaginative work, which extends learning. Does the Minister agree that making things reinforces lessons right across the curriculum?
Elizabeth Truss
I absolutely agree that it is very important that the practical and the academic line up to create a truly rigorous curriculum. We are also looking at the role of practicals in science to make sure that people get proper experience when they study chemistry and physics, as well as in the design and technology curriculum.
Andrew Stunell (Hazel Grove) (LD)
12. What steps he plans to take to ensure that all children receive a broad and balanced education that includes the creative subjects.
The Secretary of State for Education (Michael Gove)
All publicly funded schools must teach a broad and balanced curriculum, and Ofsted has a duty to inspect this. We have announced that maintained schools will continue to have a statutory requirement to teach music and art and design from the ages of five to 14. Curriculum entitlements are also in place at key stage 4. Funding agreements with academies and free schools also require them to teach a broad and balanced curriculum.
Andrew Stunell
I thank the Secretary of State for his answer. Bearing in mind how important the creative industries are as far as our exports are concerned—just to be pragmatic about this—will he give some assurance that music in particular will continue to play a part, and how will composition and other musical skills be developed at key stages 1 and 2?
Michael Gove
My right hon. Friend makes a very good point. First, I thank Darren Henley for his report on music education, which we have had a chance to implement and which has helped influence our own approach to the national curriculum in music. We want children to learn to appreciate, but also to create, which, of course, involves learning composition skills. We also want to make sure that that is done in harness with the new music hubs that are being created. “Hubs” is not a pretty word, but they are a beautiful thing, because they are bringing instrumental tuition to many more young people.
Lisa Nandy (Wigan) (Lab)
Recently the Children’s Commissioner found that girls and boys too often do not know what a good relationship looks like, so, as part of a broad and balanced curriculum, why is the Secretary of State refusing to make sex and relationships education compulsory in our schools? Is he aware that this vacuum is currently being filled in some areas by extremist groups, which are targeting vulnerable young girls with racist literature that claims to keep them safe? If he is as horrified by that as I am, is it not time to act?
Michael Gove
I am absolutely horrified by the extremist activity that the hon. Lady alludes to and if she could share that material with me, we will make sure that action is taken.
Andrea Leadsom (South Northamptonshire) (Con)
22. My right hon. Friend will be aware that his former Schools Minister, my hon. Friend the Member for Bognor Regis and Littlehampton (Mr Gibb), looked into the rating of sex and relationship education in schools, particularly primary schools. At the moment this is an area that is completely unregulated and I know that the Government have been trying to make some moves to get the British Board of Film Classification to look at it. Does the Secretary of State plan to make some progress?
Michael Gove
Yes, we do. My hon. Friend makes an important point. As the hon. Member for Wigan (Lisa Nandy) pointed out, we need to make sure that children have the information they need in order to make confident choices. We also need to take account of the fact that technology is changing rapidly. We all know some of the challenges that young people face—as a parent, I know them myself—and it is vital, as my hon. Friend says, to make sure that we do everything we can to keep inappropriate material away from children.
Kate Hoey (Vauxhall) (Lab)
The Secretary of State knows that extended days are very important in getting quality education in the wider curriculum, so will he continue to back strongly Durand academy in its desire to have a boarding element in Stedham? Does he agree that this will be a wonderful opportunity to extend the academic achievement of those young people?
Michael Gove
I owe a debt to the hon. Lady, because it was she who first invited me to visit Durand academy in her constituency. To this day I am grateful, because it is an outstanding school with a wonderful team of teachers. The fact that it is thinking of opening boarding provision for children after the age of 11 is a bright ray of hope. It is a pity that some unfortunate words have been said—[Interruption.] All I can do is quote Cardinal Newman:
“Lead, kindly Light, amid th’encircling gloom”.
The same spirit of that great pioneer of education is operating in Greg Martin’s Durand school. I hope that it will come to Sussex as well.
Catherine McKinnell (Newcastle upon Tyne North) (Lab)
13. What recent assessment he has made of the availability of primary school places; and if he will make a statement.
The Minister for Schools (Mr David Laws)
We anticipate that 382,000 new primary places and 35,000 new secondary places will be needed over this Parliament. The latest data show that new places are being created at a good rate and that local authorities are keeping up with demand.
Catherine McKinnell
Record numbers of children will be taught in class sizes of 31 or more from September, following the coalition’s decision to ditch Labour’s class size limits. The Lib Dem spokesperson for children’s services in Newcastle said in The Guardian that
“schools should be allowed to raise the number of pupils in each class as they saw fit.”
Are we going to see a return to the bad old days of overcrowded classrooms under this Tory-Lib Dem Government?
Sir Tony Baldry (Banbury) (Con)
Will my right hon. Friend confirm that between now and 2015, the Government will spend £5 billion on new school places, which is twice as much as was spent by the Labour party during a similar time frame, and that £1 billion of that is earmarked for areas that are under the greatest pressure?
Andrew Selous (South West Bedfordshire) (Con)
14. How head teachers of academies can be removed if their schools fail to make the progress that can reasonably be expected.
The Secretary of State for Education (Michael Gove)
The responsibility for the performance of an academy rests with the academy trust. Academy trusts are free to set their own processes for managing the performance, and indeed any dismissal, of head teachers. They are free to adopt the procedures that apply in maintained schools, if they choose. If the Department has concerns about the leadership of an academy, we raise the matter with the academy trust.
Andrew Selous
Successful schools are vital to the well-being of the areas that they serve. Central Bedfordshire has many outstanding head teachers in academies and maintained schools. When an academy head teacher has not made the progress that could reasonably be expected, does the Secretary of State see that there is a role for the local authority in dealing with the issue?
Michael Gove
Local authorities certainly have an important role in championing vulnerable children in particular. If they feel that any school, whether it is a maintained school, an academy or a free school, has a principal who is not doing the right job for their children, they should raise it directly with the Department and we will together take action.
Guy Opperman (Hexham) (Con)
20. Head teachers in Northumberland find it unacceptable that high local government pension scheme rates are set simply because a school decides to become an academy, and yet that is the policy of the county council. Does the Secretary of State agree that that policy is totally wrong and that head teachers who aspire for their schools to be academies should be encouraged and supported?
Michael Gove
I absolutely agree with my hon. Friend. He has fought like a tiger for the schools in his constituency and across Northumberland. I have been working with the Secretary of State for Communities and Local Government to make progress.
Dr Thérèse Coffey (Suffolk Coastal) (Con)
T1. If he will make a statement on his departmental responsibilities.
The Secretary of State for Education (Michael Gove)
As was mentioned earlier in questions, the Under-Secretary of State for Skills and I today launched the new technical baccalaureate, which will make the recognition of vocational education even more demanding and aspirational. I am grateful to Lord Adonis for the work that he has done to shine a light on what is good in vocational and technical education.
Dr Coffey
I welcome the launch of the tech bacc today. Will my right hon. Friend assure me that he will not return powers from academies to local authorities, as the shadow Secretary of State seemed to recommend last week? Is that not a U-turn on what Tony Blair and the noble Lord Adonis said when they first set up academies?
Michael Gove
My hon. Friend is absolutely right. I was very worried when I read the latest issue of The House magazine. In an interview with the shadow Secretary of State that was generally quite nice—he is a nice chap—he nevertheless said that he had “great respect” for Lord Adonis but “differences of emphasis”. He wanted to put “less of an emphasis” on
“the independent governance that academies have”.
I am afraid that, once more, that is a retreat from reform. Unfortunately, if the Labour party were to return to power, reform would stop in its tracks.
Stephen Twigg (Liverpool, West Derby) (Lab/Co-op)
May I echo the Secretary of State’s earlier comments about the Chair of the Education Committee, and wish him a speedy recovery? I also commend my hon. Friend the Member for North West Durham (Pat Glass), who is acting in the capacity of Chair.
Last October, the Leader of the Opposition set out Labour’s plans for a technical baccalaureate. Today, we have the Government’s plans. Our plan included high-quality work experience. Will work experience be integral to the Secretary of State’s technical baccalaureate?
Michael Gove
No, work experience is not integral to the technical baccalaureate. It is provided for by our changes to the funding mechanism for 16, 17 and 18-year-olds to ensure that rather than paying by the number of qualifications, which actually led to a prejudice against work experience, there can be a coherent programme of study for those who want to follow a vocational or technical path.
Stephen Twigg
I am disappointed but not surprised by that answer, because for the past three years the Secretary of State has undermined technical, practical and vocational education by abolishing statutory work experience, downgrading the engineering diploma, removing face-to-face careers advice and narrowing the curriculum so that skills are undermined. I want the tech bacc to succeed, but does he not agree that if that is to happen, he needs to reconsider all the other policies that I have listed?
Michael Gove
I am grateful to the hon. Gentleman for making his points, but I am afraid that in many areas he is quite wrong. Before the Government reformed academic qualifications, we asked Professor Alison Wolf to help reform technical and vocational qualifications. The Labour party said that it endorsed the proposals, but when we have put forward individual policies to implement her proposals, it has opposed them.
We have not abolished work experience. It was an entirely different process that referred to key stage 4, and it was a recommendation of the Wolf report, which we implemented in full. The Opposition said they backed it, but now they U-turn on it. I am afraid that the hon. Gentleman’s passion for vocational education will be credible only if he does his homework, which sadly he has failed to do so far.
Stephen Mosley (City of Chester) (Con)
T2. It is disappointing that before Easter, the National Union of Teachers and the NASUWT announced plans for strike action in the summer term, which will achieve little except disrupting children’s education and ruining parents’ working arrangements. Will my right hon. Friend do his utmost to ensure that teachers are aware of the folly of industrial action in the classroom?
Michael Gove
I entirely agree. I meet more and more teachers who are in despair at how the NUT and the NASUWT affect to represent them. One thing worries me more, however—the principal party of opposition has not yet condemned the strikes and criticised those unions. When the hon. Member for Liverpool, West Derby (Stephen Twigg) had a platform at the NASUWT conference, he should have denounced its strike action, but I am afraid there was silence.
Mr Jim Cunningham (Coventry South) (Lab)
T3. The Daycare Trust reports that just 20% of local authorities have enough places for two-year-olds in their area. Why, then, are the Government abolishing section 11 of the Childcare Act 2006, and with it the child care sufficiency report that local authorities have to publish?
The Parliamentary Under-Secretary of State for Education (Elizabeth Truss)
What we are doing is getting rid of unnecessary bureaucracy, but councils will still have responsibility for ensuring a sufficiency of child care in their area. In addition, we are creating childminder agencies, reforming provision and reforming the role of local authorities to ensure that it is easier for high-quality providers to expand, so there will be more places.
Amber Rudd (Hastings and Rye) (Con)
T4. I am delighted that seven of the eight children’s centres in Hastings are rated good or outstanding, and that despite scaremongering by the Labour party, East Sussex county council has plans to expand the service. Will the Secretary of State join me in congratulating East Sussex county council on its focus on helping families at an early stage in children’s lives?
Michael Gove
I am certainly absolutely delighted that Conservative-led East Sussex county council is doing such a good job in the early years.
Meg Munn (Sheffield, Heeley) (Lab/Co-op)
Last week, the National Society for the Prevention of Cruelty to Children produced its report on child protection, in which it described child protection services as working in overdrive. It also estimated that for every child subject to a child protection plan or on the child protection register, another eight children have suffered maltreatment. Will the Secretary of State or one of his colleagues tell me what he is doing to ensure that children who are not on child protection plans but are clearly in need of services get help and support?
Michael Gove
The Under-Secretary of State for Education, my hon. Friend the Member for Crewe and Nantwich (Mr Timpson), had the opportunity to speak at the NSPCC conference, and I had an opportunity to read the report, which I found thought-provoking and challenging. In our reform of social work practice, we are attempting to ensure that social workers can spend more time with families in need where there are children who are at risk or face neglect. We will make more announcements shortly about how we are enhancing the way the social work profession works with families that need its support.
Tessa Munt (Wells) (LD)
T5. Brymore school, a state-funded boarding school for 13 to 17-year-olds in Somerset, specialises in rural technology and has its own its own farms, stock, greenhouses, workshops, foundry and forge. Although it delivers exactly what the Secretary of State wants—vocational excellence, great maths and English teaching, and a rapid rise in exam results, having moved from the bottom 9% to the top 3% of schools nationally when looking at value added over the past two years—no land-based subjects will be included in the performance measures from 2015. Will the Secretary of State consider the recognition of agriculture and horticulture in a farm bacc, and meet parents from my patch, and others, to discuss the issue?
The Parliamentary Under-Secretary of State for Skills (Matthew Hancock)
I am grateful for that question, because I am a fan of recognising high-quality vocational education, hence the tech bacc announced today. Agricultural and land-based qualifications will, of course, be eligible for inclusion in the tech bacc and for younger age groups. However, they must be of very high quality to ensure that we provide high-quality qualifications for those who take vocational routes. I would be happy to meet the hon. Lady.
Kate Green (Stretford and Urmston) (Lab)
Nursery providers in my constituency have expressed their approval of support received from the local authority in relation to good practice, providing support and raising standards. What guarantees can Ministers provide that such support will continue under the new regulatory regime?
Elizabeth Truss
I can confirm that Ofsted is currently recruiting more HMIs—Her Majesty’s inspectors—for the early years, and will increase the frequency of inspections of weaker providers. It will also give those providers support for improvement. Existing good quality support provided by local authorities will continue, provided that the providers agree. The issue is that such support is patchy across the country, and not necessarily the same in some local authority areas as in others.
Caroline Dinenage (Gosport) (Con)
T6. Given the vital role that vocational education plays in delivering the skilled work force of the future, will the Minister explain how the technical baccalaureate will raise standards of vocational courses and attract more learners?
Matthew Hancock
The tech bacc is intended to recognise high-quality vocational education, including written work and maths. The key thing is that the occupational qualifications included will be developed and signed off by employers, because employers are vital to ensure that when we teach people vocational skills, those skills can be put to good use.
Nic Dakin (Scunthorpe) (Lab)
Changes to AS and A-levels are planned for 2015, as well as changes to GCSEs. What assessment have the Government made of the impact of that conflagration of curriculum changes on young people, schools and colleges?
Annette Brooke (Mid Dorset and North Poole) (LD)
T7. In the interest of transparency and to provide information for schools and local authorities, will the Secretary of State ensure that all reports on the asbestos incident in Cwmcarn high school in Wales, including the final report from the Health and Safety Executive, are made publicly available? I note that the local council has decided to remove asbestos from the school on safety grounds.
The Minister for Schools (Mr David Laws)
I will look at this matter on behalf of my right hon. Friend. We are keen to ensure that policy on asbestos is evidence-based, and that there is clarity about the inquiry carried out by the HSE.
Paul Goggins (Wythenshawe and Sale East) (Lab)
The average age for leaving home is 24, yet currently only one in 20 foster children is able to stay with their foster carers beyond their 18th birthday. If the Secretary of State is as shocked as I am by that, will he lead and co-ordinate an urgent initiative aimed at ensuring that every foster child, like any child, can leave home when they are ready?
The Parliamentary Under-Secretary of State for Education (Mr Edward Timpson)
I am grateful to the right hon. Gentleman, who I know takes a keen interest in this area. He will, I hope, be encouraged by the fact that I have written to every director of children’s services to re-emphasise the importance of the exact point he has just made. We have supported the “staying put” pilot, which continues in many local authorities, and I am looking at what more we can do to support care leavers, not only when they leave care, but also after they have left, so that they get all the support that they need and deserve.
Pauline Latham (Mid Derbyshire) (Con)
T8. May I draw the House’s attention to the fact that I am going through the process of becoming a board member of the new Free the Children charitable organisation in Britain? The Government’s National Citizen Service positively engages young people during their school holidays. Does my right hon. Friend agree that charitable organisations such as Free the Children, which now exists in Britain, add value to children’s primary and secondary education throughout the year, and are an excellent example of the big society in action?
Michael Gove
Free the Children is a wonderful charity and I look forward to supporting it later this evening.
Ann Coffey (Stockport) (Lab)
The Under-Secretary of State for Education, the hon. Member for Crewe and Nantwich (Mr Timpson), who has responsibility for children’s matters, is concerned about the high numbers of children placed in children’s homes some distance outside their local areas, the difficulty of supporting those children, and their vulnerability to child sexual exploitation. I am pleased that he is planning to make changes to tackle that problem, but will he update hon. Members on progress?
Mr Timpson
I once again express my gratitude to the hon. Lady for the serious and significant contribution she has made to the work my Department has done to try to tackle the important problem of children who are placed out of area in residential care—the number is almost 50%, which is far too high. That is why we have already made one change, whereby Ofsted must now report to police the location of all children’s homes. We will go further with changes to much of the regulatory framework to improve the “out of sight, out of mind” culture. I am happy to discuss with her in the coming weeks how we implement that, as I have discussed it with her in the past. An announcement will be made very shortly.
Lorely Burt (Solihull) (LD)
T9. I have recently participated in a cross-party inquiry into unwanted pregnancy. We found that there were gaping holes in understanding not only of the mechanics of sex, but of how relationships work. In a letter to the hon. Member for Kingston upon Hull North (Diana Johnson), the Under-Secretary of State for Education, the hon. Member for South West Norfolk (Elizabeth Truss), admitted that academies are not required to teach sex education. Given the life-changing consequences of such ignorance, does the Secretary of State agree that sex and relationships education should be compulsory in all schools?
Michael Gove
All academies have the opportunity to depart from the national curriculum, which is entirely appropriate, but I do not think—[Interruption.] Honestly! This is a serious subject, and I am afraid the hon. Member for Rhondda (Chris Bryant) is not doing it the service it deserves—[Interruption.]
Mr Speaker
Order. We cannot have a debate while a question is being answered—[Interruption.] Order. The Secretary of State will respond to the question as he thinks fit, without a running commentary.
Michael Gove
Thank you very much, Mr Speaker.
One inference of the hon. Lady’s question is that head teachers or principals in academies will be neglectful of the welfare of children, particularly with respect to sex and relationships education. As I have said, this is a uniquely serious matter. Given changes in technology and family formation, it requires the attention of all us if we are to get it right. One thing my Department has done is conduct a survey of best practice. Sometimes, best practice occurs in faith schools and academies and not in maintained schools. Simply prescribing something in the national curriculum does not mean that best practice will result. I am afraid that the debate deserves more than the catcalls and superficial sloganising we get from some people.
Diana Johnson (Kingston upon Hull North) (Lab)
May I therefore ask the Secretary of State directly why he will introduce financial education as part of the compulsory national curriculum and yet denies that drug education, alcohol education and relationship education should have the same status?
Michael Gove
As the hon. Lady acknowledges, the changes to the citizenship curriculum have been widely supported. She draws a distinction between what happens in one national curriculum area and others—as the hon. Member for Solihull (Lorely Burt) has pointed out, academies are not subject to the national curriculum. If we look at the national curriculum overall, we see that there is an absolute requirement in science to teach sex education, and sex and relationships education is part of the national curriculum expectation for all schools.
Penny Mordaunt (Portsmouth North) (Con)
Is the Secretary of State aware of the problems still being caused by the private finance initiative building programme? Miltoncross school in Portsmouth has ambitions to become an academy, but cannot make progress owing to unresolved issues in its PFI contract. Will the Secretary of State meet me regarding that problem and assist in getting it resolved?
Lyn Brown (West Ham) (Lab)
How does the Government’s rhetoric on supporting catch-up literacy match the ongoing closure of libraries up and down the country? Do his Government ever attempt to join up, or are they just extraordinarily bad at it?
Michael Gove
The hon. Lady again shows the devotion to partisanship that has characterised her time in the House. The truth is that some local authorities do a superb job in making library services more relevant and more effective, but others are not doing so effectively—as we are in an election season, it is probably worth pointing out that they are mainly Labour, whether, for example, it is Brent or Newham. If she is serious about raising standards in literacy and ensuring that children have the opportunity to enjoy great works of literature, perhaps she will throw her support behind the national curriculum reforms and the academy and free school reforms we are making. I fear that, once again, she will go into the default mode of Opposition Members, which is to make cheap sloganeering points rather than to care about children.
Mr Rob Wilson (Reading East) (Con)
Owing to the sudden, serious illness of a head teacher at a school in my constituency, the names of a number of children who were due to sit the level 6 SATs test were not submitted in time. Despite these exceptional circumstances, which the local authority supports, the Standards and Testing Agency will not make an exception. Will the Minister intervene in this rather silly bureaucracy and allow the children, who have worked very hard, to take the test?
Michael Gove
I am aware that this is a widespread issue; a number of colleagues have raised it with me. We will talk to the schools concerned to see what we can do, but it is difficult, when the STA gave appropriate notice, to necessarily make exceptions.
Alex Cunningham (Stockton North) (Lab)
Following the Secretary of State’s visit to Stockton last week, does he expect any schools in the area, attended by children from my constituency, to close as a result of the creation of surplus places if a new free school is opened in the south of the borough?
Michael Gove
It was great to visit Stockton South. My hon. Friend the Member for Stockton South (James Wharton) is an outstanding MP and people were saying to me, “If only there were more Conservatives in the north-east.” People were also saying to me that they need a new school because, apart from the free school that is being built, provision in the north of the constituency is not good enough. I am only sorry that Labour-led Stockton council has stood in the way of parents who are working with us, and with the Conservative MP, to improve education. [Interruption.] Once again, if the hon. Member for Stockton North (Alex Cunningham) would only haud his whisht and listen to the parents, he would be of far better service to the children of Teesside.
Point of Order
Chris Bryant (Rhondda) (Lab)
On a point of order, Mr Speaker. You may or may not be aware that there has been an break in electricity in Portcullis House, which means that there is no means of knowing if a Division is taking place. The Annunciator screens and computers are not working. The only things working are the lights. When we come to a Division, I wonder whether we might ensure that it is possible for everybody across the parliamentary estate to know when there is to be a vote.
Mr Speaker
I note what the hon. Gentleman has said. There is no Division expected for some time, but his point is taken on board by the Chair and I thank him for making it.
Public service pensions bill (programme) (No.2)
Motion made, and Question put forthwith (Standing Order No. 83A(7)),
That the following provisions shall apply to the Public Service Pensions Bill for the purpose of supplementing the Order of 29 October 2012 (Public Service Pensions Bill (Programme)):
Consideration of Lords Amendments
1. Proceedings on consideration of Lords Amendments shall (so far as not previously concluded) be brought to a conclusion two hours after their commencement at today’s sitting.
2. The Lords Amendments shall be considered in the following order:
Lords amendments 78 and 79.
Lords amendment 9.
Lords amendments 1 to 8, 10 to 77, 80 to 128.
Subsequent stages
3. Any further Message from the Lords may be considered forthwith without any Question being put.
4. The proceedings on any further Message from the Lords shall (so far as not previously concluded) be brought to a conclusion one hour after their commencement.—(Anne Milton.)
Question agreed to.
Public Service Pensions Bill
(11 years ago)
Commons ChamberRead Full debate Read Hansard Text Read Debate Ministerial Extracts
17:35 - The House divided: - Ayes: 278 / Noes: 217 - Question accordingly agreed to.
17:50 - The House divided: - Ayes: 282 / Noes: 218 - Question accordingly agreed to.
Mr Speaker
I must draw the House’s attention to the fact that financial privilege is involved in Lords amendments 18, 19, 22, 28, 29, 37 to 39, 45, 78, 79, 82, 114, 117, 119 and 127. If the House agrees to the amendments, I will cause an appropriate entry to be made in the Journal.
Schedule 1
Persons in public service: definitions
The Economic Secretary to the Treasury (Sajid Javid)
I beg to move, That this House disagrees with Lords amendment 78.
Mr Speaker
With this it will be convenient to discuss the following:
Lords amendment 79, and Government motion to disagree.
Sajid Javid
We return today to the Public Service Pensions Bill, which will put public service pensions on a fair and sustainable footing for generations to come. There was broad support from all parts of the House for this measure, and I am grateful to all those who have voiced an interest in the Bill for their co-operative approach. I would also like to draw the attention of the House to the progress the Bill has made in the other place.
First, when the Bill left this House, the Opposition were concerned about the wide scope of powers to make retrospective changes and to amend primary legislation. The Government understand that concern. Pensions are an important part of scheme members’ future income in retirement. We therefore tabled amendments in the other place to give members or their representatives a complete veto over any significant adverse retrospective change to their pensions and to restrict the powers to amend primary legislation. Furthermore, any Treasury orders for negative revaluation of scheme benefits will now need to be made by the affirmative Commons procedure.
Secondly, the Opposition sought further assurances on the governance elements of the legislation, particularly a requirement in the Bill for employee representatives on scheme boards. Again, I am pleased to report that the Government tabled amendments in the other place to require an equal balance of member and employer representatives, along with an explicit requirement for national scheme advisory boards.
Richard Fuller (Bedford) (Con)
My hon. Friend is talking about some welcome changes that the Government have made, but there is another party to this contract on pensions. The taxpayer will foot the bill for the unfunded part of the obligations of public sector pensions. Will he assure me—
Mr Speaker
Order. Will the hon. Gentleman resume his seat? I do not blame him, in the first instance, because the trouble, the mischief, was started, however inadvertently, by the Minister, who is looking at me with an innocent expression belied by the reality of what he was saying in the debate. This is not a generalised debate; these are narrowly defined matters, and we are considering the relevant amendment, to which, to put it kindly, the hon. Gentleman’s remarks were not altogether adjacent.
Sajid Javid
With your guidance, Mr Speaker, which I always take very seriously, I will move directly to Lords amendments 78 and 79.
The Lords amendments would give the civil servants in the MOD fire and police services a normal pension age of 60 in the new schemes. The Government do not believe that this is the correct way forward.
Sir Bob Russell (Colchester) (LD)
Is the Minister seriously stating that an MOD police or fire officer should be treated differently from a police or fire officer not employed by the MOD?
Sajid Javid
As I make progress and explain the Government’s position, I will come to that point.
The Government do not believe the amendments to be the correct way forward, either for the taxpayer or the forces themselves. I will briefly set out some of the key reasons for our position. Allow me first, however, to reassure both hon. Members and the work forces themselves that the Government understand their concerns. We have listened to the representations and reflected on the discussions in another place, and I want to make it absolutely clear that we recognise the unique position of these work forces and the important role that the defence fire and rescue service and the Ministry of Defence police play.
My colleague Lord Newby met DFRS and MDP officers to talk through their experiences on the ground and the demands of their roles. There is no doubt that these public services deliver a valuable service to the armed forces and the country more generally. The nature of the work they are called on to deliver is often very difficult and at times can be dangerous. On occasion, some members of these work forces might find themselves putting their lives at risk. No one in the House is suggesting otherwise, so let us not be distracted from this important discussion by cherry-picking anecdotes and citing emotive examples of the work involved, because that is not the issue being discussed today.
Simon Hughes (Bermondsey and Old Southwark) (LD)
Like many people, I have met representatives of workers in the MOD scheme, and they have referred me to Lord Hutton’s comments that he was not aware of the anomaly and therefore did not address it in his report, but that he was sympathetic. I have seen both sides of the argument. Our noble friend Lord Newby said that he would reflect on the debate in the Lords. Have there been any further conversations with Lord Hutton? In general, my understanding is that the Government are seeking to implement Lord Hutton’s recommendations, but this issue has clearly slipped through the net.
Sajid Javid
My right hon. Friend is right to raise Lord Hutton’s contribution to these pension reforms. He has done an excellent job overall, which the Government, including me, have put on record a number of times, although I am happy to do so again today. As my right hon. Friend says, Lord Hutton made clear his views on this issue in the debate in the other place. Since then Lord Newby has engaged with a number of stakeholders. I will provide a further update on that as I progress.
Ian Paisley (North Antrim) (DUP)
Lord Newby said in the House of Lords debate that these amendments would
“fundamentally alter the status of these individuals and that should not be carried out lightly.”—[Official Report, House of Lords, 12 February 2013; Vol. 571, c. 743.]
How does the Minister respond to those points and will he say what those alterations would be?
Sajid Javid
I thank the hon. Gentleman for his intervention. I agree that the general pension reforms in this Bill should not be carried out lightly. As I progress and we have this debate, I hope he will be reassured that the Government have taken this issue seriously and will set out their case carefully.
The issue at hand is the appropriate treatment of those work forces’ pensions. The amendments would actively reduce the normal pension age for individuals joining them. It would not be a minor reduction, but a reduction of five years from the pension age put in place for those work forces by the Labour Government in 2007. It would also be a reduction of seven years from the pension age that they would otherwise see when the new scheme comes into force in 2015. That approach would run counter to the need to control the risks associated with increased longevity, which all parties agree must be addressed. I believe that all parties in this House support the aim of controlling those risks. The amendments would make those work forces unique in the public sector, with their pension age falling at a time when everyone else’s is rising.
In response to the issue being highlighted, the Government have taken measured and appropriate action. Rather than making a knee-jerk response to fit with the legislative time scale of the Public Service Pensions Bill, the Ministry of Defence has written to the forces. Its letter states that the MOD is willing to consider how the current pension age of 65 might be maintained for those individuals when the new pension schemes are introduced in 2015. I believe that is a reasonable offer by the Government, and we will of course stand by it. It is our duty as parliamentarians to look at the whole picture. Pensions are only one part of the remuneration and employment package of those work forces.
Sir Bob Russell
The Minister is saying that the retirement age of a current Ministry of Defence police officer would remain at 65. So that I can better understand, what would the retirement age for a constable in the Essex police be?
Sajid Javid
To be clear, what I have said is that the Ministry of Defence is willing to consider keeping the age at 65. It has not yet made that decision, which would require further engagement, although it has set out how it intends to engage. As I think my hon. Friend knows, under these proposals the answer to his question about a police officer would be 60, as opposed to 65 for civil servant pension schemes.
Chris Leslie (Nottingham East) (Lab/Co-op)
When the Minister complains that agreeing to these Lords amendments would create a unique circumstance, is he not really admitting that the unique characteristic of this particular class of MOD firefighter and MOD police officer is that they are the outliers? They are the only ones who will have to work all those extra years, whereas other police officers and firefighters in comparable roles will retire at 60. That is essentially what he is saying.
Sajid Javid
During the Bill’s passage through Parliament, the Opposition spokesman has raised mostly constructive issues and, as we shall see during this debate, the Government have accepted many of them. This is one issue, however, on which he and his party have little credibility. He says that the current retirement age for MOD police and fire service workers is higher than that of their civilian counterparts, but that situation was created by the Government whom he supported, so he really does not have much credibility on the issue.
Sajid Javid
I will give way to the hon. Gentleman again. Perhaps he will now tell me whether the previous Government considered these issues when they changed the retirement age from 60 to 65 for MOD fire service workers and policemen.
Chris Leslie
I was not part of the Government at that time, but the key point is that, as he knows and as we have heard throughout the debates that have been quoted in interventions today, even Lord Hutton did not spot this anomaly. Lord Hutton says that, if he had known about it, he would of course have corrected it and aligned the MOD firefighters with all the other firefighters. I am prepared to say that the last Government overlooked this issue; it was an error. It was a mistake, and we should be big enough to admit that. Is the Minister now big enough to throw away his Treasury brief, which simply tells him to resist all changes, and to act for himself and do the right thing by treating all firefighters the same?
Sajid Javid
I am very comfortable that the Government are doing the right thing by resisting the amendments. As the debate progresses, I hope that more hon. Members will be persuaded that we have taken the right approach to this complex issue. I shall explain further as the debate progresses.
John McDonnell (Hayes and Harlington) (Lab)
Will the Minister explain the nature of the offer? I just want to know what the process will involve, following consultation. Will it require primary legislation, or will it be dealt with through delegated legislation? How will it be implemented? What sort of time scale is he considering?
Sajid Javid
The hon. Gentleman is asking those questions for all the right reasons. I still have a few more minutes in which to set out the Government’s case, and I hope that I shall answer them in the process. If anything remains unclear, however, I hope that he will come back to me. I will be happy to add to the information that I am giving the House.
Richard Fuller
Labour has accepted that it completely forgot about those workers when it was in government. Its spokesman has been noble enough to admit that it did not find the 350 people in the fire service and 3,000 people in the military police. Given that my hon. Friend the Minister now understands that fact, can he tell me why the workers did not bring the issue to the attention of the then Government? Were the unions involved in any negotiations at the time, or has this just become an issue now?
Sajid Javid
My hon. Friend raises a good point. I cannot answer on behalf of the previous Government, but I can say that the change was carried out by ministerial order. There was no open, ongoing debate on the matter like the one we are having today. A written ministerial statement was issued by the then Minister for the East Midlands, Gillian Merron, on 26 July 2007, and I can find no record of any Labour MP complaining about the change at that time. If my hon. Friend is making the point that the Opposition’s credibility is severely damaged because of this, he is making it very well.
Sir Bob Russell
It was not connected to the pensions issue, but I raised with Labour Ministers at the time the stupidity of cutting the size of the MOD police, whose numbers in my constituency have been reduced from 33 to one.
Sajid Javid
We all know that my hon. Friend is an assiduous Member of Parliament, and that he reviews all legislation carefully. I thank him for making that point. He will no doubt have looked at these matters closely at the time, and I welcome his looking at the legislation today.
Ian Paisley
The party political spat is incredibly interesting to observers—and the employees are the people who count most here. Will the Minister set out for me—he has been able to travel some way in his contributions to date—where the terms and conditions of employment set for Ministry of Defence personnel are materially and significantly different from those of ordinary Home Office fire services and police officers across the rest of the UK? If he set that out clearly, it might help me to come over to his side on this issue.
Sajid Javid
The hon. Gentleman may already know that MOD fire workers and police are classed as part of the civil service and, as such, are part of the principal civil service pension scheme. That is why the changes I referred to, which were made by the then Government back in 2007, affected those employees. As I plough on through my speech, I hope I will be able to answer some of his concerns.
Ian Paisley
I thank the Minister for his generosity in giving way again. It is the material condition of their work that counts. What is significantly different between an officer who dons a hat with an MOD badge putting out a fire and one who does so but dons a hat with his regional service cap? I simply do not get it, and I think that many Members do not get it either, while those who do not get it the most are the fire service men.
Sajid Javid
Clearly, there is some difference in the roles they carry out, but I readily accept that the physical attributes required and the difficulty of the job are similar in each case. That is why I said at the outset that there is no point in trying to debate the difficulties, for example, of one job in the civil fire service in comparison with those in the MOD fire service, but significant differences have developed over time between the pay and conditions, including the pensions, of the civil and the MOD work forces. The hon. Gentleman will see, as I have outlined, that the MOD has committed to consider the issue. My main point is that this Bill deals with approximately 12 million employees and their pensions in the public sector, and that this is not the right occasion for looking at individual terms and conditions in each scheme for each particular work force. There is a time and a place for that—but it is not the debate on this Bill. I do not believe that it is the job of Members here or in the other place to look at the individual terms of each scheme. Rather, we should ensure that the Bill we pass has sufficient flexibilities to ensure that if the NPAs—normal pension ages—or other terms and conditions in the pensions for particular work forces need to be changed at some point in the future, that can be accommodated.
Alison Seabeck (Plymouth, Moor View) (Lab)
Will the Minister tell us how many meetings he has had with Defence Ministers to discuss the implications for the MOD and how many he has held with the MOD police and fire service trade unions?
Sajid Javid
I can tell the hon. Lady that I am not the only Minister in the Treasury working on this issue, as there is a whole team of Ministers, including my noble Friend Lord Newby. Treasury Ministers have had meetings with representatives of the respective work forces and other stakeholders. I would like to plough on—
Sajid Javid
I promise that I will in a few moments.
It is our duty as parliamentarians to look at the whole picture of pensions, which are only one part of the remuneration and employment packages for these particular work forces. We should not simplify the issue by making stark comparisons out of context. Simply comparing these forces to their local authority counterparts achieves no useful purpose beyond critical grandstanding. Differences between these forces’ terms of employment are of long standing. If these issues are to be reopened, they should be considered in the round, with proper consultation between employer and employees.
As well as having different retirement ages from local authority, fire and police personnel, the MOD employees have different contribution rates and levels of pay. Unlike their local authority counterparts, they also have access to benefits such as the civil service compensation scheme. To pluck out their pensions from the wider package would be short-sighted, and potentially damaging to the efforts of both employers and employees to get the package right.
Mr Anderson
I thank the Minister for giving way. He is being very generous.
We are not just legislating on people’s terms and conditions, and it is important for us not to legislate and get it wrong. What about people’s capability to do the job? Are people over 60 expected to go into a burning building in the same way as they did when they were 26? John Hutton clearly does not think that they should do so if they work for a local authority, and the same should apply in this context. We should think not only about the person who is running into the building, but about the person who is inside waiting for him. That is why the Minister should change his mind.
Sajid Javid
The hon. Gentleman has made a good point, and made it well. It is important to consider the capability of each work force, especially in view of increased longevity, and to ensure that the retirement age is appropriate. That is what I expect the MOD to do, and that is what it is doing, but it should do it in the context of the particular scheme for each work force, rather than by becoming involved in the details of each work force that are affected by the broad changes introduced by the Bill.
We have a responsibility to look rationally at the costs of the proposed changes. The additional costs may appear small in comparison with the savings that the Government are making through their overall programme of pension reforms, but the Government consider them to be both unnecessary and significant. They are unnecessary because those concerned will continue to have access to the civil service pension scheme, which is an excellent scheme that many in the private sector, including those doing the most arduous or specialist work, would envy. They are significant because some early indications suggest that they could be as high as £10 million a year for the lifetime of the schemes. This expenditure would take money away from front-line servicemen and women, and from other important defence priorities.
Those who support the amendments may believe that the members should pay the cost of the reduced retirement age themselves. That would imply increased employee contributions and a potential average take-home pay cut of over 8%—although it would depend on the exact terms—which might not necessarily be welcomed by members of the forces.
As politicians, we should not be trying to set the fine detail of public servants' pension schemes on the Floor of the House. Rushing at it might lead to mistakes. As I hope I have made clear, I acknowledge that the issue deserves further consideration allowing time for discussions between employer and employee. We owe it to the DFRS and the MDP to get this right.
Simon Hughes
What the Minister has just said is very helpful, provided that the Treasury too will be helpful if the negotiations between the unions and the MOD produce a different package. I understand the financial point, and I also understand that this is not just about retirement ages but about all the other benefits, which may be better than they are under the present arrangement. Can the Minister confirm that, if the MOD picks up the baton, the Treasury will not walk away and say “Nothing to do with us, guv”, but will continue to take an interest in the resolution of this outstanding bit of business?
Sajid Javid
What I can confirm is that the Treasury and the MOD are in exactly the same place. The MOD agrees with the terms that I am presenting today, and, as I have said, has made it clear that it will think about the issue. It has already written about it to members of the forces, as I would expect it to do in its capacity as the employer of these vital groups of workers.
The Government have not dismissed the claims of the DFRS or the MDP; far from it. The MOD has acknowledged in writing that there is a case for looking at their pension age to check that it is still appropriate.
Finally, there is a technical reason why the Government cannot accept these amendments as they currently stand. They would—unintentionally, I assume—confer powers on the Scottish Parliament and Welsh Assembly to make schemes for these civil servants. That would give new functions to devolved Administrations, without any proper consultation or consideration of whether that is the appropriate framework for managing the interests of these specialised work forces.
In summary, this is a complicated and inevitably emotive issue, and one that we have discussed at some length. I am sure I will not have persuaded all Members present today.
Mr Anderson
The Minister has made two clear points: this issue has not been resolved and needs to be resolved; and there is an issue to do with the Welsh and Scottish Parliaments. Therefore, is not the genuine thing to do to withdraw the Bill today, until those points can be put right?
Sajid Javid
I have to disagree. Of course that is not the right thing to do. This Bill is about 12 million workers in the public sector and their pensions, and about the settlement between those employees, their employers and the taxpayer, and it is vital that we make this reform so we can get the public finances on a sounder footing. I think the hon. Gentleman knows that, but I do not blame him for trying.
I hope hon. Members at least understand why we are taking this position on these amendments. I have explained why we have to resist the amendments, citing the financial privileges of this House on this occasion. I therefore urge hon. Members to disagree with this group of amendments.
Chris Leslie
Although the Minister had quite a long preamble, not necessarily on these amendments, all I would say is that, clearly, with life expectancies increasing, it is in general reasonable to ask people to work for longer before retirement. There is no disagreement on that general principle. We need to adjust the public service pension schemes so that they remain sustainable, which is why we support so many of the changes Lord Hutton recommended. However, as hon. Members know, there are certain categories of workers for whom having longer careers is not realistic because of the physical demands of their professions. There are some physical tasks that it is not reasonable to expect a 67 or 68-year-old to undertake.
The Bill acknowledges that in part, by excluding three categories of worker— firefighters, police officers and members of the armed forces—and fixing their normal pension age at 60. That is a rational position, but there are other professions that we believe the Government should keep under review because they also can be exceptionally physically demanding, such as NHS paramedics and care workers. There is clearly a need for some flexibility to accommodate scheme-specific capability reviews for these associated professions, and it is a great shame that the Government have not allowed the latitude for that in the Bill. We debated that in Committee.
Lords amendments 78 and 79 are aimed at correcting what most people thought to be an oversight: the fact that, for some bizarre reason, Ministry of Defence firefighters and MOD police officers are excluded from the definitions of firefighters and police officers in the Bill. There are about 2,000 MOD police and 1,000 or so MOD fire and rescue scheme workers who essentially carry out the same crucial, but onerous, tasks as police and fire service workers under the auspices of the police authorities and the Home Office.
Sir Bob Russell
In addition to the point the hon. Gentleman has just made, does he agree that, particularly with regard to Faslane and the nuclear submarines and installations there, MOD firefighers and police officers carry out duties that the civilian police and firefighters do not have to do?
Chris Leslie
I am grateful to the hon. Gentleman for making that point, because I think that is indeed the case, but my general point is about the physical demands on these individuals. Today we are debating whether their retirement age should be, as the Minister thinks, 67 or above, or whether it should be at 60—the same age as for other firefighters, police officers and members of the armed forces. It is a simple proposition and the House has the power to make a judgment on it today.
Richard Fuller
The hon. Gentleman makes the case on physicality for those three classes of public sector employees, but the crucial issue is that those people put their lives at risk, which other public sector workers do not. Can he advise the House why the issue was not raised, and why those people were missed, in earlier pension scheme reforms?
Chris Leslie
That is a very pertinent question. We heard from the Minister that 12 million people were affected by the various public service and civil service pension schemes. We heard that even Lord Hutton, in his detailed inquiry, was not aware of the 350 or so affected individuals, because it was a new scheme that started in 2007, and only some MOD firefighters and police will come into the age bracket. Given the complexity of pensions, it is not surprising that some issues were not spotted; apparently even some employee representatives and others were not aware of the anomaly at the time.
These things happen. Mistakes can be made, but it is really important that when a mistake is pointed out, people assess whether they are big enough to accept that it needs to be corrected and justice is done, or whether their pride is such—whether or not this applies to the civil service—that they try to retrofit their arguments to justify a clearly unjustifiable anomaly. That is what the question boils down to.
The only reason I can see for different treatment for those groups is that one set happens to be employed by the Ministry of Defence and the other is in the public service at large. It is such an evident anomaly that the House of Lords, when made aware of the lacuna, correctly sought to repair the fault in the Bill, but incredibly we heard from the Economic Secretary—I am delighted that he has been joined by the Chief Secretary; perhaps he can be lent on by more enlightened colleagues—[Interruption.] The hon. Member for Colchester (Sir Bob Russell) says he will have a go, but he does not have much time as the question will be put shortly. [Interruption.] Anyway, Ministers are not particularly interested in listening to the debate, so it might be useful if the hon. Gentleman could text the Economic Secretary to suggest that he pays attention.
In essence, the Economic Secretary said that the Government were too proud to admit that they had got it wrong. They are still defending the indefensible, but the arguments for admitting the error are overwhelming.
Alison Seabeck
Does my hon. Friend share my concern that if the Government do not accept some of the changes, some people—albeit a small number—who cannot carry out normal duties will be unable to do the job for which they are being paid? Therefore fewer people will be able to fight fires or to respond in the most physical of circumstances. How does my hon. Friend see the future for those employees?
Chris Leslie
Quite a few of those employees already retire before the normal retirement age because of issues of physicality—the sheer effort involved in undertaking such physical tasks. It is entirely unreasonable and unfair that there is such a discrepancy between public service workers who carry out the same job. They are all called on to put their lives on the line. The burden of justifying the anomaly now rests with the Government, but other than some rather unconvincing arguments, which the Minister barely touched on, they have failed to discharge their burden and to illustrate why MOD firefighters and police are so different. The Minister took interventions from many colleagues and on a number of occasions he said, “Oh well, I’ll come to it in my speech,” but amazingly he never did.
Simon Hughes
Given that neither the Labour Government nor Lord Hutton spotted the issue, and it has now been raised with this Government, does the hon. Gentleman not think that a reasonable way forward is what the Minister suggested at the end of his speech? We should allow the MOD and the unions to see if they can negotiate a proposal that could be implemented under the broad remit of the Bill. That must be the reasonable, sensible, grown-up way forward.
Chris Leslie
At this eleventh hour, no, because the issue has been familiar to the Government for many months. The Minister said that there was not even a proposal on the table. We are able to judge, as Lord Hutton was able to judge, as suggested by the quotes from the House of Lords debate, the definitions of firefighter, police officer and armed forces, for whom the Bill categorically specifies the normal pension age as 60. The right hon. Gentleman is suggesting that some sort of negotiation is needed about whether those individuals are indeed firefighters or police officers of the same class. I disagree with him, if he is naive enough to think that the Treasury and the Ministry of Defence do not need to be pushed on the issue. Today is the opportunity to vote on it. I know he will listen to the debate and I hope he will vote in the right way and not try to find some excuse for kicking the issue into the long grass, hoping that people will forget about it yet again. We have the opportunity to deal with it now. Let us have a bit of gumption and deal with it in the way that we can do.
Simon Hughes
May I tell the hon. Gentleman respectfully why I disagree with that? This is not just about age. It is about a whole package of benefits, some of which are much more advantageous to people in the civil service than they would be to someone in a parallel position in local government. I am not in a position, and even those on the Labour Benches who represent unions are not in a position, to do a deal here on their behalf. If Government are committed to a deal being done, it must be right to remit the issue to the employer and the unions to negotiate an outcome.
Chris Leslie
I am very sorry that the right hon. Gentleman’s true colours have come through in that way. He is clearly not going to support the move to reduce the retirement age to 60. He should, and I will tell him why. The key question was put by Lord Eatwell in the other place, who asked about the different treatment and whether the Government could justify it. He asked:
“In what way is it less onerous, when they”—
that is, the MOD firefighters—
“have to work on military establishments”—
as the hon. Member for Colchester (Sir Bob Russell) said—
“dealing on occasion with extremely dangerous materials, and occasionally also in war zones? How is their job less onerous?”—[Official Report, House of Lords, 12 February 2013; Vol. 743, c. 568.]
Unfortunately, my noble Friend did not receive a satisfactory answer to the question, so I repeat it now to the Minister: what reason is there for that different treatment? Do not Ministry of Defence police officers have to stay fit, remain physically alert and intervene in events of great physical danger? Do not Ministry of Defence firefighters have to be ready to run the gauntlet, endure the exertions of search and rescue in extreme circumstances, take intense risks, prove their stamina and make sure that they can rise to the most testing of circumstances? The arguments that justify excluding the police and fire and rescue workers from the link between state pension age and normal pension age apply equally to the MOD police and the MOD firefighters. Just because they are a tiny number of workers should not mean that Ministers can just turn a blind eye and ignore the issue. We cannot allow it to be swept under the carpet. There is no reason for the difference, and the Government have no justification for opposing the amendments.
Stephen McPartland (Stevenage) (Con)
This is a difficult amendment owing to its emotive nature, with a small number of people feeling almost as though they have been victimised. If the Government reject the amendment, can the hon. Gentleman offer those workers some hope that if Labour formed a Government in 2015, it would do as the Lords amendments say?
Chris Leslie
I am amazed that hon. Members who are in government refuse to take responsibility for the offices that they hold and for the decisions that they have in their grasp. I said that it is important to admit that a mistake has been made for these 350-odd MOD firefighters and police. Why on earth cannot Members on the Government Benches say the same? [Interruption.] If the Minister wishes to correct me, I shall be delighted to hear.
Mr Reid
It was a legitimate question from the hon. Member for Stevenage (Stephen McPartland). Labour is seeking to form the next Government. The next election is only two years away. Surely the hon. Member for Nottingham East (Chris Leslie) should answer questions about what his party will do if it is in power?
Chris Leslie
How much more of an answer can I give than the actions that we will take in the Division Lobby today? Instead of the party political games that the Liberal Democrats and the Conservatives are playing today, it is a responsible thing to do to try to help—[Interruption.] They laugh, but this is not a laughing matter. They expect these firefighters and police officers to work up to the age of 67 or above, and that is not the right thing to do.
Chris Leslie
I have given way enough to Conservative Members and I want to make some progress because it is important to bottom out these specious arguments that the Minister can barely grasp.
Lord Hutton said that the reasons for giving uniformed forces a lower normal pension age is the
“simple argument that the nature of their service is unique and should be reflected in the pension arrangements that we make for them. ”—[Official Report, House of Lords, 12 February 2013; Vol. 743, c. 520.]
In his report he recommended that the Government set a new normal pension age of 60 across the “uniformed services”. That was the phrase that he used. He did not refer to the type of pension they were in; instead he referred to “uniformed services”, and argued that they deserved to be singled out because of the nature of their work. The spirit of Lord Hutton’s recommendation clearly applies to MOD firefighters and police officers. Lord Hutton said:
“The nature of the work the uniformed services perform is unique and this needs to be reflected in their Normal Pension Ages. The modernised firefighters scheme has struck a balance between recognising these changes in life expectancy, but also recognising the unique nature of the service provided by scheme members. The Commission’s view is that the Normal Pension Age in this scheme, 60, should be seen as setting a benchmark for the uniformed services as a whole.”
We agree with Lord Hutton’s reasoning that the amendment was merely intended to correct an oversight that has occurred in drawing up the Bill. He supports the amendment and the reform is based on his idea. He said that
“if, during the course of my inquiry, I had known about the unique circumstances of the MOD firefighters, I would have referred specifically to them in my report…Sadly, this issue was not drawn to my attention, so it did not make any specific recommendations about the MOD firefighters or the MOD police. If I had known about it, I certainly would have done so.”—[Official Report, House of Lords, 12 February 2013; Vol. 743, c. 570.]
It is important to mention this. We are towards the end of the Bill’s passage and we have not had much opportunity to debate it. This has been brought to my attention during the course of turning the pages on the detail of this pension legislation. The Opposition say the same as Lord Hutton. This is just one of those anomalies that we should be big enough to admit was wrongly overlooked in previous reforms.
It is true that the last Government raised the normal pension age for the civil service to 65 for post-2007 entrants, and that included Ministry of Defence staff. However, I am now convinced that had we known then about the small group of firefighters and police officers who are technically on the civil service payroll rather than employed by police or fire authorities, we would have taken account of these groups, and an exception could have been carved out. There should be no embarrassment inside the Treasury in admitting that this was an oversight. Regarding this previous change, even the Defence Police Federation said that the
“Council of Civil Service Unions did not consult the DPF, and we did not have the opportunity to make the above points about the physical demands of being an MDP officer”.
The issue was not raised or considered when it should have been. Those staff should not be punished because of that particular oversight. If Lord Hutton is able to admit the oversight and if Opposition Members in this Chamber are able to admit the oversight, the Economic Secretary should be big enough now to do the same. Rather than just read out the brief provided to him, he should engage his brain, use his own judgment and discretion, and do the right thing. If he engaged the brain of the Chief Secretary, who is sitting alongside him, that might go some way towards a solution.
There is the cost to the public purse argument, but as I understand it, only 56 people have joined the Ministry of Defence police, and fewer than 300 have joined the defence fire and rescue service since 2007. So the anomaly could be easily corrected by bringing a small minority of pensioners back into line with the pre-2007 entrants’ normal pension age of 60. We are not talking about a large number of firefighters or police officers here. Sadly, we have had to get to the Floor of the House of Commons to put the pressure on the Government. What the Government have tried to present as a cost is in reality a reduction in the predicted saving from this overall package of changes. They overestimated the savings to be made by overlooking the existence of this particular group of fire and police officers and failed to include them in the definition of uniformed services.
The Minister might put up various arguments, but the question of physical burden cannot be overlooked. A worker for the Ministry of Defence police may be required to wear 11 stone-worth of kit, and a normal shift will involve wearing 5 or 6 stone-worth of equipment for up to 11 hours. Workers in the Ministry of Defence fire service carry out the already difficult and dangerous job of firefighters, but do so in war zones and other extremely hazardous conditions around the world.
The fact that these workers are labelled civil servants should not blind us to the reality of what their jobs entail. Along with the police and the armed forces, they are the only public service workers who have to undergo regular fitness tests. In fact, the majority retire before 60 because they are unable to meet the high demands their jobs entail. They are also recognised as uniformed forces in the civil service pension scheme, and there is a small reflection of that already. Unlike civilian police forces, there is no option in the MOD police for officers to move to unarmed work if they struggle to cope physically. Even when mainstream police officers are armed, they are not expected routinely to carry guns around beyond the age of 55.
Another point that has been brought to my attention today—I imagine that this is something none of us is massively familiar with—is that many MOD firefighters have to work alongside colleagues who will qualify for retirement at 60. Royal Air Force firefighters—I think that they are called Trade Group 8—will often be on similar operations with service colleagues, working in the field together. One colleague will retire at 60, whereas another standing next to him will be required to work to 65, 66, 67 or beyond. The same applies to Royal Navy firefighters, who are regarded in their classification as armed forces. This is riddled with anomalies, and it would be very simple for Ministers to overcome them. They really ought not to have allowed this to become such a large point of debate.
Ian Paisley
It should also be pointed out that many of those personnel also serve in war zones, are deployed overseas and have been decorated for their service, which I think sets them apart, with regard to the changes that the Government are refusing to make.
Chris Leslie
Absolutely. Sadly, there is also an argument that the Government, by holding out in this way, are letting down those serving in our armed forces. They are giving the impression that they think they can sweep the issue under the carpet and let it ride. There are already concerns that they might be increasing the risk to national security by cutting the number of MOD police officers—from 3,600 to 2,400 by April 2016—and in many ways a feeling of betrayal is starting to accumulate.
This matter might be an irritant for the Minister, whom we know is looking for a pat on the head from his betters higher up the food chain, but it would be nice if he, rather than trying to deliver a neat and perfect Bill with no loose ends by resisting any issues that annoyingly come up in the course of debate, used his position to take account of the important questions that come up. I have encountered a number of such issues in my time at the Opposition Dispatch Box and as a Minister, and it is quite plain that at some point in the next few weeks Ministers will have to put their hands up and admit that they will back down. It would be far neater and quicker, and to the Minister’s credit, if he said so now.
This matter needs to be resolved. Telling MOD firefighters and police officers to stop rocking the boat and to accept a half-baked assurance that the Government might enter into some negotiations on whether the pension age should be 65 gives them no way to protect their situation beyond the short duration of the Minister’s tenure in office. We need to correct that glaring error in the Bill. I commend Lords amendments 78 and 79 and urge the House not to disagree with them.
Mr Reid
I am disappointed that the Government have not accepted Lords amendments 78 and 79. I support the rest of the Bill, which I think contains good proposals for tackling the issue of people living longer, but I think that that one part is an anomaly and an oversight, as Lord Hutton has admitted. It will leave MOD police and fire personnel in an anomalous position as the only uniformed personnel who will not retire at 60.
Many of my constituents who work as police and firefighters at Faslane and Coulport will be affected. As has been said, their counterparts in local authority fire services and other police forces will retire at 60, and I believe that they, not other civil servants, are the correct comparison for defence police and firefighters.
Hywel Williams (Arfon) (PC)
The hon. Gentleman is making fine points about the physicality of the job. The Minister said that the terms and conditions of the pensions of MOD firefighters and police are immaterial to their ability to carry out the job. Does the hon. Gentleman agree with me and disagree with the Minister?
Mr Reid
I agree that the pension rules are immaterial to their ability to carry out the job. That is the point that I am trying to make. The work of the uniformed services is unique because it involves short bursts of high physical effort and mental alertness. That is what makes these jobs different and why I do not believe it makes sense for them to have to carry on beyond 60.
There should be a simple rule for retirement age. The uniformed services should retire at 60 and other people should retire at the state pension age. If the Lords amendments were accepted, that principle would be implemented. Defence police and firefighters, like other uniformed services, are highly trained and their job puts them in dangerous situations and requires a high degree of fitness.
I hope that the Government will reflect and agree—if not today, then at some point in the future—that people in these occupations can retire at 60.
Mr Anderson
Ever since this Government took office there has been an attack on public sector pensions. Throughout the debates on public sector pensions, they have ignored the advice of the members of the schemes, the trade unions and the organisations that represent the members. They have torn up long-held agreements, reduced payouts, increased the length of time that people have to pay in and increased the level of contributions.
Many of the Government’s arguments have been based on the work of John Hutton. They have said to Labour Members: “Not us, guv! Your man gave us the template and we’re following his work.” Why on earth are they ignoring John Hutton now? Is it because they have an in-built anti-public sector dogma? Do they want to pull down public sector workers whenever they have the chance to get away with it? Is it because—I think this is the main reason, because the Treasury’s fingerprints are all over this—they are driven by the dogma of a failed Chancellor, who wants to save money in any way that he can because his plan A has failed miserably and the economy of this country has not just stagnated, but has stalled and gone backwards?
John Hutton has said clearly that he made a mistake. My hon. Friend the Member for Nottingham East (Chris Leslie) quoted him. He said that he had missed this point, that he had made an error, and that if he had known about it, he would have addressed it at the time. At the end of his speech, John Hutton said:
“It is incumbent on us to address that issue and not to use the technical arguments as an excuse for not addressing this fundamental discrepancy.”—[Official Report, House of Lords, 12 February 2013; Vol. 743, c. 570.]
A discrepancy is what this is. It is not a huge issue of principle. It is something that was missed by the people who were advising John Hutton, including the trade unions. It was also missed six or seven years ago when we changed the rules. Back Benchers like me should have raised it with our Government. Opposition Members at that time, including Liberal Democrat Members, should have raised it. However, we did not raise it, the trade unions did not raise it and the civil servants who were giving the advice at the time did not raise it, and it went through.
It could be put right now. As John Hutton said, it is a fundamental error. If it is not put right now, is it just because the Government are being contradictory, given that they have argued at every other time that we should follow John Hutton’s template, or because they are being cynically hypocritical? We could put it right, and we could do it now.
It is nonsense to say that the workers in question are somehow civil servants first and police officers or firefighters second. When they run into a building, they do not think, “I’m a civil servant”, they think, “I’m the man who’s going in to sort out a terrorist or to try to rescue somebody from a fire.” I said before that there is no difference between them and a police officer or firefighter working for a local authority, but at times there is, because sometimes they run into buildings where there are things like nuclear weapons, explosives or somebody waiting for them with a shotgun, a machine gun, a hand grenade or other explosive device. The physical and mental intensity and the pressure on them is huge, and that should be represented in the Bill.
The argument that people in different pension schemes cannot be on different terms and conditions is nonsense. For years in the national health service, we allowed mental health nurses to retire at 55, or if they chose to carry on working, their pension was guaranteed at that age, because of the nature of their work. It was about the intensity of going to work every day and grappling with some of the most disturbed people in society. That was the right thing to do then, and it is the right thing to do today.
We all saw what happened 30 years ago, when Margaret Thatcher’s Government reduced the retirement age for coal miners first to 62 and then to 60. They did so for the right reason—they realised that people in that industry were a special case and deserved to be seen in that way. At the time of the reduction, in 1980, the life expectancy of a miner was 65 years and two days, so they got their pension for two days. Because of the change in the law, they got the chance to get their pension for up to five years longer, and that was the right thing to do. It is clear to me that the change in the Bill is nothing other than an attempt to escape from the need to pay people what they are entitled to.
Mr Frank Roy (Motherwell and Wishaw) (Lab)
Is there not a danger of there being a poorer level of service if emergency workers are older?
Mr Anderson
I agree entirely, as somebody who is facing his 60th birthday—it comes up like an express train. I was a care worker, and I would hate to think that I would still be caring for people at my age, and in the physical shape that I am in at the moment. I would guess that the people I would be caring for might share that view.
The Minister says that there will be negotiations and discussions, but if there is to be a serious discussion, a job evaluation scheme needs to be put in place to see who a worker should be compared with. So far, the people in question are being compared with other civil servants. Should somebody carrying backpacks and armour be compared with somebody working in an office? Of course not. They should be compared with people who are out there doing a similar job for a different organisation. That would lead to exactly the conclusion that John Hutton has now come to. That is why we should support the Lords amendments and the Minister should have the good grace to accept them. They would get him off the hook.
Stephen McPartland
The Lords amendments are great, and I would like to be able to accept them, but I have some concerns about them. Members of all parties are concerned about the emotive nature of the Bill’s effects on a small group of people. I would like to put it on record that I am proud of the public sector. Many members of my family work in it, and they show great commitment to the services in which they work on a day-to-day basis. Some of them risk their lives, and others almost risk their lives teaching very small children—I would much rather address the House than a classroom of 30 primary school children.
The work of Ministry of Defence police and firefighters is incredibly important, and it would be disingenuous of Members to try to identify whether the job of one set of police officers in the Home Office is more dangerous than that of another set in the Ministry of Defence. Some police officers in the Home Office do a great deal of work in difficult circumstances in some of our areas on a Friday and Saturday night, and some have jobs that are predominantly focused around the desk and paperwork. Those jobs are also very important in the attempt to reduce crime and provide police intelligence.
As I said, this is an emotive issue, and the real problem is the knee-jerk reaction that we are seeing on the Floor of the House to the attempt to resolve it. The shadow Minister said honestly that a mistake was made in 2007 that went through by ministerial order. There was no debate in the Chamber on the retirement age of the forces in question being raised from 60 to 65. I understand, as the hon. Member for Blaydon (Mr Anderson) said, that some people of a particular size, weight and age would not be the best at resolving the problems we have in some of our towns and cities.
Chris Leslie
The hon. Gentleman is fortunate—as are we all—to have been elected by his constituents to make decisions, and what could be simpler than this? Essentially it is about whether all firefighters and police officers, whoever their technical employer, should be able to retire at 60. The hon. Gentleman is flannelling around trying to find reasons not to do that, but in his heart of hearts he thinks they should retire at 60—does he not?
Stephen McPartland
I genuinely believe that people should have the opportunity to make that decision and consult the Government and the trade unions. I do not want a broad-brush approach to this matter. It is not that I do not trust the shadow Minister, but he is trying to pull me into a political trap. I am not interested in politics in that sense; I am interested in representing my constituents and I do not want to accept an amendment that could technically make those fire and police officers worse off in the future. I would like to know far more about the details behind the amendment and what accepting it would mean.
The Minister mentioned a figure of around 8% that could be a reduction in net pay. If we accept such an amendment, and the mistake made by the previous Government in 2007 is reversed, I think we should negotiate with trade unions and fire and police officers so that we fully understand what its impact will be on their take-home salary at the end of each month, and how it will affect decisions in their careers and moving forward. I want everybody to have a fair opportunity, and as I have said, I am proud of the public sector and the work it does. Although the amendment seems fair, I do not feel that I can support it because of the broad-brush approach that could lead to MOD police officers and fire service personnel having a worse set of circumstances in a year or two, just so that party political points can be scored. Unfortunately, I will not be able to support the amendment, but I urge the Minister to provide us with more detail in his winding-up speech about how he will encourage the MOD to sit down with the unions and ensure that the pension age will not rise above 65, and that any decision on the pension age will be about 65 and downwards.
Dr Eilidh Whiteford (Banff and Buchan) (SNP)
I wish to make a few brief points in support of Lords amendments 78 and 79, which seem eminently sensible and seek simply to bring the normal pension age for MOD police and defence fire and rescue personnel in line with arrangements for other fire and police personnel who do broadly similar jobs. As others have pointed out, when the amendments were first debated in the other place, Lord Hutton seems to have acknowledged that the omission of MOD police and firefighters from his original considerations was an oversight. I agree wholeheartedly with his remarks when he said:
“It is incumbent on us to address that issue and not to use the technical arguments as an excuse for not addressing this fundamental discrepancy.”—[Official Report, House of Lords, 12 February 2013; Vol. 743, c. 570.]
I support the Lords amendments because MOD police and firefighting officers need consistent treatment with other police and firefighters.
Lord Hutton’s conclusion in recommendation 14 of his report was by no means arbitrary. In recommending a normal pension age of 60 for uniformed services personnel, the Hutton report drew on a wide evidence base. It recognised that the nature of the job places intense physical demands on officers and requires them to maintain levels of health and fitness that are not necessary in other day-to-day jobs. That acknowledgment has underpinned the design of terms and conditions for police and firefighters for many years, and remains as pertinent and relevant as it ever was, even if the age at which those personnel will be eligible for retirement has shifted.
It is useful to remember that changing demographics and increases in life expectancy have underpinned the process of pension reform. However, although life expectancy has increased significantly in recent decades, the increase in healthy life expectancy has not kept pace. People are living longer, but they are more likely to live with debilitating health conditions or disabilities. I made general observations on that in earlier stages of the Bill, but it is particularly relevant to the uniformed services, because it is imperative that officers are physically capable of meeting the demands of the job. Hutton implicitly acknowledged that when he called for the increase in normal pension age for the uniformed services to be kept under regular review.
We must be realistic about the physical limitations of mere mortals. Hard physical work takes its toll on human bodies. It is clear that people who work in heavier, more demanding jobs suffer more physical strain as they get older. Like the hon. Member for Argyll and Bute (Mr Reid), I was struck by the briefing ahead of the debate from the Defence Fire Risk Management Organisation, which set out in some detail not only the physical demands placed on defence fire and rescue personnel, but the risks to officers, which increase with age—they rise exponentially for officers aged 50 and over. We must be realistic about what we ask people to do. We should not do the sums on paper without thinking of the real cost.
We need to be careful when we talk about the monetary cost. The Minister relied on the argument that the measure will cost too much, but we need to be careful if we assume that the higher pension age will save us money. All hon. Members know that staff retiring on health grounds can be an expensive business. It is all the more expensive when the reasons for a person leaving their job are linked to their occupation. That is an extremely expensive way to do things. We need to look at both sides of the balance sheet before we jump to the conclusion that treating MOD police and firefighters differently from other police and firefighters will save us money.
At the end of the day, this comes down to the fact that MOD police and the defence fire and rescue officers are, to all intents and purposes, uniformed service personnel. They need to be fit and strong, and physically and mentally capable of carrying out their duties in an emergency. We need to recognise that and treat them in exactly the same way—as far as possible—as we treat other police and firefighters.
Another important part of the context is that morale in those services has been put under considerable strain in recent times owing to changes to terms and conditions and proposed reductions to services. Like the hon. Member for Colchester (Sir Bob Russell), who intervened earlier, I have MOD police in my constituency—they look after the St Fergus gas terminal. I am therefore very much aware of the great uncertainty that has overshadowed the service because of MOD reviews. I am also aware that a proposed voluntary early release scheme, for which, I believe, 600 officers applied, has been subject to a rethink. I am glad that the MOD has recognised the folly of rushing in with ill-thought-through cuts, but officers who had applied for early release have been left in a kind of limbo. The service needs to ensure that younger officers come up through the ranks, but the uncertainties of the past few years have undermined morale and the good will of officers, who take substantial risks in their day-to-day working lives, and who we expect to be on the front line during any crisis.
That is why I do not have confidence in the solution set out by the Minister. I know that some of his Liberal Democrat colleagues in the coalition have accepted it—if I had not seen officers being mucked about by the MOD’s prevarication over the early release scheme, I would have more confidence in the Government’s proposals. However, having witnessed that, and seeing that the issue is still unresolved, I really do not have that confidence. In that context, I would be keen to see the amendments go through as they are, and I urge Liberal Democrats to come through the Lobby and make their voices heard on behalf of their constituents.
Mr Reid
I want to make it clear on the record that I believe the Government when they say that they want to keep the retirement age at 65, instead of increasing it progressively to 68 when the state pension age goes up. The Government have made that offer. My argument was that the retirement age should be 60, because of the decline in their physical ability to perform at peak fitness after that age.
Dr Whiteford
The hon. Gentleman makes a valid point. Like me, he has constituents who have applied for the early release scheme and been mucked about. That is why we should settle the matter today on the Floor of the House, instead of allowing it to be sent off into the long grass where we can prevaricate some more before failing to reach the conclusion that people need to be treated with consistency.
The question of consistency underpins everything. There is recognition that other police and firefighters need a lower normal pension age than those in less physically demanding roles. People who do the same jobs, but for the MOD, need to be recognised in exactly the same way. I urge the Government to observe the spirit of the Hutton report, accept that this was an oversight, and do the right thing by our MOD police and firefighters by accepting the Lords amendments. I hope, even at this very late stage, that the Minister will capitulate.
Sir Bob Russell
It is regrettable that no Defence Minister is here, because we could be putting the cart before the horse. What is crucial is the fitness for the purpose for which our MOD firefighters and police are employed. That should be the first, driving principle, and then we can move on to retirement ages and pensions. Does the country really want its nuclear bases to be defended by people of my age? Is it really safe for someone of my age to put out a fire on a nuclear submarine? The clear answer is no. It is therefore regrettable that the MOD is not represented in this important debate. This debate must be important, because I have missed the welcome home parade of 4th Mechanised Brigade. As a member of the Defence Committee, I always wish to welcome home our troops. I hope the fact that I am here will be read as an indication of how seriously I take this debate.
I draw the attention of the House to what Lord Hutton of Furness said in the other place:
“I do not believe that there is any substantive technical reason why we cannot look again at the role of the MoD firefighters and the MoD police.”
He went on to say:
“Surely there has to be a way of doing the right thing for these people.”—[Official Report, House of Lords, 12 February 2013; Vol. 743, c. 570.]
I came to this debate fully intending to vote in support of the Lords amendments, but their unintended consequences could well lead to our MOD firefighters and police being financially worse off, albeit while retiring at a younger age. I will therefore take the Minister at his word—he is a Minister whom I trust—and give the matter further consideration in the spirit and intention of what Lord Hutton has said.
Gemma Doyle (West Dunbartonshire) (Lab/Co-op)
Will the hon. Gentleman explain why he thinks MOD police and firefighters could be worse off if their normal retirement age is set at 60? That has been repeated a number of times, but I do not believe that it has been explained.
Sir Bob Russell
Yes. As I understand it, the retirement age is one anomaly, but the contributions towards pension funds are another anomaly. To ask the House to have its cake and eat it might be asking for too much.
Gemma Doyle
I do not believe that that is actually in the Bill. I do not believe that pension contributions will be affected, if the House votes to allow MOD police officers and firefighters to retire at 60. As we know—the hon. Gentleman and I represent some of these people—they want to be able to retire at 60.
Sir Bob Russell
The hon. Lady used the words, “I believe”, and although she may well be right, it is because of the uncertainty that I welcome the promise from the Minister, whom I must take at his word, to give this matter further consideration. It is worth taking that on board.
Sir Bob Russell
Well, the hon. Lady and I must beg to differ. I do not want her to think that her support for MOD firefighters and police officers is greater than mine. I was arguing in support of the MOD police when the previous Labour Government were cutting their numbers—so I can do without those sorts of comparisons.
I ask the Minister to give a categorical assurance on the concerns raised by hon. Members on both sides of the House. I particularly welcome the comments from the hon. Members for North Antrim (Ian Paisley) and for Blaydon (Mr Anderson) and my right hon. Friend the Member for Bermondsey and Old Southwark (Simon Hughes), who raised questions that have not yet been fully answered. My hon. Friend the Member for Argyll and Bute (Mr Reid) and the hon. Members for Stevenage (Stephen McPartland) and for Banff and Buchan (Dr Whiteford) also raised concerns.
Simon Hughes
I pay tribute to my hon. Friend’s work on this matter. I have had a chance to check the answer to the question from the hon. Member for West Dunbartonshire (Gemma Doyle). If the amendment were accepted, it would immediately transfer the people in question out of the civil service definition. They would get the benefit of an earlier retirement age, but they would also get the disbenefit of other comparative advantages. That is why we need a negotiated conclusion, not one-line changes to the Bill.
Sir Bob Russell
I am extremely grateful to my right hon. Friend. When I referred to the unintended consequences, I was not expecting a detailed exposé of what one of them would be.
With some reluctance, I am taking the Minister at his word about the unintended consequences, and I urge the House to do the same. I take on board everything that Lord Hutton has said subsequently about his not being aware of the issue. Trusting the Minister, I think that our MOD firefighters and police officers could conceivably end up better off. I repeat my basic point, however, because the MOD needs to move quickly to reassure the nation about our military depots and nuclear installations. I have seen Faslane at first hand, and we do not want a Dad’s Army—people my age—defending our nuclear installations or trying to put out fires in military establishments.
John McDonnell
I welcome the new enthusiasm on both sides of the House for negotiating with trade unions. We have seen 18 months of industrial action followed by the imposition of a pensions settlement on a large number of civil service workers. I therefore welcome this enthusiasm for negotiating the issue out.
The Government’s policy on pensions was twofold: they wanted to bring together a consistent retirement age across the services, while, as part of public service reform, ensuring a process of modernisation, with retirement schemes reflecting the requirements of service delivery. From what we have received today, I think we are reintroducing an element of chaos into the retirement age. Far from ensuring consistency, we seem to be building anomaly upon anomaly. Far from pragmatically reflecting the reality of delivering a service, we are about to undermine another service.
On delivery, we should learn the lessons of 2007. I did not support the increase in the retirement age for firefighters in 2007, just as I have not supported this legislation. The lesson that the Fire Brigades Union taught us was that once we increase the retirement age in such a physically demanding job, apart from having a physical effect on those workers and their lives—and on their families, too—we do not save money, because people take ill-health retirement, as others have said. At the end of the day, this is not part of a modernisation process; it is a step backwards.
The other issue raised was consistency—this argument that there will be consistency across the uniformed services. However, that was never the case anyway, because we argued for the Prison Service and uniformed services in the health service to be included, but they were excluded. The issue of consistency is drawn even more sharply by the exclusion of the group of staff we are discussing in this debate, who are clearly part of a uniformed service. They are being discriminated against purely on the basis of who employs them. Firefighters who are employed by local government via a fire authority are within the scheme at age 60, whereas those employed by these other bodies are not. That is not just policy making on the hoof; to be frank, it is incompetent policy making.
As for the disbenefits, when a general agreement is taken into legislation in this way there is always the facility for the employer and others to adjust contribution rates, albeit as part of a negotiated settlement, but we usually legislate and then iron out the detail of the contribution rates, with the matter usually being resolved through an adjustment of the employer’s contribution.
Let me turn finally to the process. The Minister helpfully tried to respond, but there was insufficient detail. If there is to be negotiation on this issue, we need at least a commitment about the time scale. There has to be a limited time scale, over the next three months, in which we can resolve these anomalies and give this group of workers some security, because the current insecurity is causing concern.
Chris Leslie
My hon. Friend is spot on. We need that time frame, but do we not also need a commitment from the Minister today that the age of 60—this is the equality issue—is, at the very least, a possibility that is on the table? So far we have not had that.
John McDonnell
Today we have at least set out the parameters of what the negotiations will be. The age of 60 has to be No. 1 on the agenda, followed by ironing out other anomalies. The second issue is the point I raised in an intervention on the Minister. We have to have a clear definition of the legislative process by which the negotiated settlement will be speedily agreed through the House. Will it be tacked on to other primary legislation or might there be a speedy regulation change that enables us to implement the process?
Simon Hughes
I, too, pay tribute to the hon. Gentleman for the work he has done. I share his view that it would be helpful if the Minister indicated in the winding-up speech that there will be a fixed timetable for concluding the process and that the age change from 65 to 60 would be on the agenda. If he can do that, I think that realistically, given that we are at the beginning of this financial year, that would be acceptable. I have not cleared that with the unions, but we need something that gives some parameters and the Minister would carry us with him if he set them.
John McDonnell
To go back a bit, I would also like some clarity about the legislative process. The time scale for negotiations can be set and the agenda for those negotiations clarified; my anxiety is that if we do not have a commitment on the time scale for legislation, the issue could be kicked into the long grass or even further. That would be seen by the workers as an act of bad faith unless a clear timetable was also given for the legislative process.
Simon Hughes
I have one quick thought—I am trying to be helpful. In every year there is inevitably a Finance Bill. This is a Treasury matter and could therefore be covered in the new Session by the Finance Bill.
John McDonnell
That is all I am asking for: clarity of process and time scale. It would be extremely helpful, as an act of good will and good faith, for the Minister to take back a reference to this matter in the Queen’s Speech. That would indicate to those involved that the Government attach a priority to ironing out what has been accepted as an anomaly. It is one that might affect only a relatively small number, but it does so critically and in a critical service, as others have said.
Richard Fuller
It is customary to say what a pleasure it is to follow the previous speaker, and in this case it is a great pleasure to have listened to the contribution from the hon. Member for Hayes and Harlington (John McDonnell). He asked precise questions and reinforced some of the points made by my right hon. Friend the Member for Bermondsey and Old Southwark (Simon Hughes) in order to move forward what the Minister had said earlier. Thanks to those two contributions, we are beginning to get to the real meat of the issue of how we can ensure that this group of overlooked public sector workers can find an acceptable and fair outcome to their pension situation after all these years.
Within the overall ambit of the Bill, I speak as one who sits outside the cosy compromise between Government and Opposition Members on the principles set out by Lord Hutton. Our decisions on pensions must stand the test of time. People make decisions about contributions to their pensions based on the expectation that those contributions will have an effect 20 or 30 years later when they retire. My concern about the compromise relates to affordability, given that we are asking the taxpayer to foot the bill.
I want to draw the House’s attention to the specific costs involved in the measure. I am sure that the Minister will correct me if I am wrong, but I believe that the amount involved is £10 million per annum. I am a big admirer of my hon. Friend the Member for Stevenage (Stephen McPartland), but he said earlier that £10 million a year was not really a considerable amount of money. I believe, however, that it is indeed a considerable amount of money to be paid year on year. Under the previous Government, it was that attitude that £10 million here and £10 million there did not really matter that led to the grotesque financial situation that we found ourselves in in 2010.
Stephen McPartland
The point I was making was that, although £10 million is a lot of money at a personal level, I do not feel that it should be a reason to allow such discrepancies to continue. The House should be trying to create parity between all those who do that difficult job on a daily basis, and to focus on the overall package of measures rather than just on the pensions question. That £10 million could provide savings, as the Minister suggested earlier.
Richard Fuller
My hon. Friend has characteristically drawn us to the centre ground. When we consider our public sector workers, we should look not at their pensions in isolation but at the broader question of the compensation terms and conditions under which they are employed.
As I have said, we are talking about a relatively small number of workers. Those members of our public services have a physically demanding job, but it is also a requirement of their public service employment that they are at times asked to put their lives at risk to maintain public safety. It behoves us to take a special approach to such workers and to the way in which their pension conditions are treated.
John Hemming (Birmingham, Yardley) (LD)
Does my hon. Friend agree that this is about the physical efforts of the uniformed services, and that the £10 million will not derail the whole package? We need to be aware that certain jobs are particularly physically demanding, and that people cannot keep on doing them until they reach the relatively young age of my hon. Friend the Member for Colchester (Sir Bob Russell), for example?
Richard Fuller
I do not wish to disagree with my hon. Friend, but I may have to do so. Many jobs in both the public and private sector are physically demanding, but I would not advocate a different retirement age purely on the basis of physicality. The Opposition Front-Bench spokesman tried to make a specific point about physicality, but I believe that that is the wrong course to take. I believe that this group of workers—the MOD police force and firefighters—have an additional requirement placed on them by us, the taxpayers, whereby we ask them as part of their responsibilities potentially to put their lives at risk, or at least to put the safety and interests of the public ahead of themselves. If I may say so, that is a far more appropriate basis for our looking at this particular issue. People may wish to make the case for physicality, but there is a special case here that goes above and beyond that. That is, I think, the reason why the Minister has taken such great interest in trying to find a solution on this issue.
I welcomed hearing the Labour party admit that it completely forgot about these people when it was in office and raised the pension age. Hearing that was welcome, because all Governments make mistakes and people do get missed out in the transitions. Let me explain what I would like to hear from the hon. Member for Nottingham East (Chris Leslie) today. There is a chance in future—I do not think it will be in 2015, but it is likely at some time for these public sector workers in the MOD, the fire service or the police force—of there being a Labour Government.
Richard Fuller
I am pleased that the shadow spokesman raises that possibility. Is he therefore prepared to put his money where his mouth is—today? He has made a commitment, but is it just words? If he is so confident of being in office, will he pledge today to ensure that these MOD workers have the same conditions as he advocates? I give way if he wishes to make that pledge.
Chris Leslie
The hon. Gentleman knows, I hope, that we are not making this decision in 2015; we are making it here and now in 2013. We have to confront the issue. He is trying to find all sorts of reasons not to disagree with the Whips who are leaning on him, saying “Please do not vote with your conscience on this particular issue.” We have accepted that the issue should have been addressed in 2007. Now that there is no excuse for lacking awareness of it—it is being debated now—is he really going to vote today, in his full awareness of these facts, to say that this particular group of firefighters should not be entitled to retire at 60 when all the other firefighters are? Is that really what he is going to do?
Richard Fuller
The hon. Member for Nottingham East is a fine fellow, but I have to tell him—[Interruption.] “Fine fellow” will be the beginning and end of my comments to him. [Interruption.] I will come to the point, as this strikes at the credibility of the political class in this country. What the Labour party spokesman is trying to do is to use words to set up people’s expectations without taking the responsibility to fund them. That is why the political class is seen through by the public, who are fed up with politicians making up arguments that exist in the world of fancy but not in the hard reality in which people live. If I may say so to the fine fellow opposite, if he wants to be honest to the British people and, more importantly, to the people whom this amendment is designed to represent, it is his responsibility to pledge today to put taxpayers’ money where his mouth is if he is ever in government. I note that that is a commitment that he has very specifically missed out today.
John Hemming
The Opposition seem to be saying that the decision should be made today without negotiation, but does my hon. Friend agree with me that negotiation is the best way forward, and that to have such negotiation, we need to support the Government’s proposal for negotiation?
Richard Fuller
I am grateful for my hon. Friend’s second intervention, because it enables me to agree with him this time. As I said at the start of my speech, the hon. Member for Hayes and Harlington and the right hon. Member for Bermondsey and Old Southwark made the same point in pressing the Minister for more specificity. I, too, wish to ask him for clarification on that point.
Madam Deputy Speaker (Dawn Primarolo)
Order. May I remind the hon. Gentleman that the debate is time-limited? If he wishes to hear the Minister’s clarification, he must leave time for it before the debate ends at 5.37 pm.
Richard Fuller
I shall attempt to make my points speedily, Madam Deputy Speaker.
The hon. Member for Hayes and Harlington made two requests. He asked when the negotiations that may be conducted between the Ministry of Defence and the workers and their representatives would have to be concluded, and suggested a three-month time frame. I support that recommendation. He also asked for an indication from the Minister, today if possible but otherwise in a subsequent letter to Members, of what the legislative process would be for the reaching of a resolution. I think that both those suggestions are very worth while.
Will the Minister confirm that the assessment by MOD and the workers’ representatives will not specify a particular retirement age, and that the decision will be based on an assessment of the potential ability of members of those work forces to do their jobs effectively? Will he also confirm—I think he said this earlier, but confirmation would be helpful—that the scheme will be flexible enough to allow us to make the changes without any limit, but that it will be up to those in the scheme to make the recommendations? I hope that he will be able to make those two commitments today.
It is important for the Government to be able to maintain a dialogue about the retirement age of our firefighters, both in the MOD and outside it. We are embarking on unknown territory, and I think that a Government who listen to these workers will be seen to be truly putting their money and their heart where their mouth and commitments are.
Sajid Javid
I thank all who have spoken during the past hour. I also thank my right hon. Friend the Member for East Yorkshire (Mr Knight), who could not speak in the debate, but who has an interest in the issue and has made representations to me on behalf of his constituents. I hope that I shall be able to respond to the points that have been made in the time that is available to me.
Both my hon. Friend the Member for Argyll and Bute (Mr Reid) and the hon. Member for Banff and Buchan (Dr Whiteford) made a number of points. As they will understand, I could not agree with everything that they said, but they both made the sensible point that the Treasury and the MOD should take account of those who retire early on health grounds when considering the potential cost implications of the changes that we are discussing. I agree that we must bear in mind all the impacts on costs that the amendments might have.
My hon. Friend the Member for Stevenage (Stephen McPartland) also raised a number of issues, including the important issue of the Opposition’s credibility in this regard. Some MOD firefighters and police officers who are listening to the debate will already have a retirement age of 65 rather than 60 because of the changes made by the last Government in 2007. When the hon. Member for Nottingham East (Chris Leslie) speaks about such matters, his own credibility becomes somewhat shallow.
I do not often agree with the hon. Member for Blaydon (Mr Anderson). I again did not agree with much of what he said, but I know he believes passionately in what he says, and I respect fully what he had to say. He is a great advocate for his constituents, but he, too, did not address the issue of the change that was made in 2007, and nor did his party colleague, the hon. Member for Hayes and Harlington (John McDonnell). For the purposes of this debate, it would be useful to know whether the hon. Members who have spoken up today also did so when the retirement age was changed in 2007.
Mr Anderson
If the Minister checks the record tomorrow, he will see that I specifically said I made a mistake, and I also made a point about the Liberal Democrats not raising this issue at that time. The Minister is therefore wrong if he is saying I did not deal with the issue.
Sajid Javid
I shall now give way to the hon. Member for Hayes and Harlington.
Sajid Javid
That is characteristic of the hon. Gentleman, as he opposes a lot in this Chamber, and perhaps did so even when his party was in government.
My hon. Friend the Member for Colchester (Sir Bob Russell) raised a number of points. I agree with his comments about fitness for the purpose. He asked about whether MOD firefighters and police officers are fit for the purpose and that is key, because it is essential that we set retirement ages that are appropriate for the jobs in question, as I said in my opening speech.
My hon. Friend also touched on the related issue of pension contributions. If we just accept these amendments, there will be consequences from the changes. The hon. Member for West Dunbartonshire (Gemma Doyle), speaking for the Opposition, intervened on my hon. Friend on that matter, but what she said was wrong, because there would be consequences. We would have to think about who would pay for these changes, and if there were a change in the retirement age we clearly could not have a situation where, for instance, the civilian firefighters and the MOD firefighters had the same retirement age but paid different pension contributions. We would have to consider such issues. The hon. Lady knows that such issues exist, and it does not serve this House well to pretend they do not.
Chris Leslie
The Members who have engaged in this debate were asking the Minister to see whether there would be any movement, and one issue raised was the time frame for any potential negotiation on movement. I happen to think we should hold out for 60—that that should be the decision today—but I do want to ask the Minister: is he sure there is the potential for going to 60 for MOD firefighters and civilian firefighters without primary legislation? I am worried that, if we let this matter pass today, we might not be able to deal with it through regulations and secondary legislation, and that we will instead require primary legislation if we are to have the potential to get parity. Can the Minister confirm that we would need primary legislation for that?
Sajid Javid
I was going to come to that issue, because my hon. Friend the Member for Bedford (Richard Fuller) and the hon. Member for Hayes and Harlington, as well as the Opposition spokesperson, raised it. I will say a bit about the MOD process, but first let me repeat an important point: this is a broad-ranging Bill to deal with all public sector pensions, affecting approximately 12 million individuals, by addressing the issue of increasing life expectancy and seeking to find the necessary savings in a fair way from employees, employers and the taxpayer. It is framework legislation: it sets the general framework for individual schemes, but that is all it does. It is for the individual employer organisations and the employees to negotiate the terms of each scheme.
We deliberately set up the legislation to provide significant flexibility, so that if the MOD, and therefore the Government, decide at a later date that the retirement age needs to change, it would not require further legislation. The MOD can make the decision in discussion with stakeholders and others. The legislation will give not just the MOD but all public sector employee organisations flexibility to deal with the particular circumstances of their schemes.
John McDonnell
When the legislation leaves this House and goes back to the other place, could the Minister write to us explicitly about the generality of the Bill—about its being a framework Bill? It seems curious that a framework Bill lists a number of categories of worker whose retirement age will be at 60. That is why many people felt they needed to be included in that list if they were to be protected. It seems odd that the Minister is now saying, “Don’t worry because it is a general framework Bill.”
Sajid Javid
The Government have been very clear that one of the purposes of the Bill is to deal with increasing life expectancy and longevity. That is why retirement ages are increasing for almost all public sector workers, and there is a link to the state pension age. The Government must address the issue; it was something the previous Government ducked, but it is vital for making the public finances more secure. That situation has not changed. What I am outlining today, with regard to the issue relating to MOD firefighters and police officers, is that there is flexibility within the MOD scheme for it to come up with a different arrangement. The MOD has agreed to look into that. It has not made any decisions, but I am sure that it will look very carefully indeed at the issue.
Chris Leslie
The Minister says that the Bill is flexible. May I direct him to page 23, schedule 1, where there is a definition of fire and rescue workers? It states:
“In this Act, ‘fire and rescue workers’ means persons employed by…a fire and rescue authority in England or Wales…the Scottish Fire and Rescue Service, or…the Northern Ireland Fire and Rescue Service Board.”
Currently, that reference does not include Ministry of Defence firefighters. Can the Minister tell us that it does not require primary legislation to amend schedule 1 in that way?
Sajid Javid
I thought I made myself clear but I will say it again: it would not require primary legislation if the MOD decided it was appropriate and right to make any changes to the retirement age.
Simon Hughes
The Minister is being very helpful. In answer to an earlier question, he alluded to the timetable that has started. Would it be reasonable to assume that the negotiations are intended to be concluded by the MOD during this financial year at the latest?
Sajid Javid
My right hon. Friend asks a good question. I have heard the desire of the House for a timetable and I respect that. I will ask my noble Friend Lord Newby to speak further on that point tomorrow.
The hon. Member for Hayes and Harlington asked me to write to him on a specific issue, and I will. I heard that point.
This has been a passionate debate. The Government have been very clear that we value tremendously the work of MOD firefighters and police officers. We have heard clearly the issues that have been raised today and how passionately they have been argued. I hope that I have managed to persuade some hon. Members—no doubt I have not managed to persuade all of them—that the Government take the issue seriously. The MOD will be looking into the issue and has already set the ball rolling. I hope that that will be a speedy process, and I urge the House to vote against the amendments.
Question put, That this House disagrees with Lords amendment 78.
Crime and Courts Bill [Lords]
The Secretary of State for Culture, Media and Sport (Maria Miller)
I beg to move, That this House agrees with Lords amendment 17A.
Mr Deputy Speaker (Mr Nigel Evans)
With this it will be convenient to discuss the following:
Lords amendment 17B.
Government amendments (a) and (b) in lieu of Lords amendment 131A.
Maria Miller
Hon. Members will recall that on Report on 18 March the House agreed to a number of new clauses which, together with an amendment to the Enterprise and Regulatory Reform Bill, implement the legislative parts of the cross-party agreement on Leveson. They will also remember that the published clauses, along with the royal charter, enabled the Government to bring forward a cross-party agreement based on a system of incentivisation rather than compulsion. There will be a tough system of self-regulation that avoids full statutory regulation—the Rubicon that the Prime Minister and I refuse to cross. The clauses will put in place the incentive-based, self-regulatory system for the press envisaged by Lord Justice Leveson.
The other place agreed, by and large, with the Commons amendments, but there is one substantive issue that we need to resolve: namely, the position within the new framework of small-scale bloggers. Government amendments (a) and (b) in lieu of Lords amendment 131A address that issue.
It might assist the House if I put the amendments in context by explaining our approach to the definition of “relevant publisher”. At present, four interlocking tests define who is and who is not a relevant publisher for the purposes of these provisions. A relevant publisher must meet all of those. They must publish news-related material, be written by different authors, be subject to editorial control and be published in the course of business, whether or not that is with a view to profit.
We want to ensure that the new approach acts as the incentive that Lord Justice Leveson intended, but we have to be clear and careful about which publishers are covered. He said of the new regulatory body:
“Ideally the body would attract membership from all news and periodical publishers, including news publishers online. It is important for the credibility of the system, as well as for the promotion of high standards of journalism and the protection of individual rights, that the body should have the widest possible membership among news providers.”
However, he was also clear that:
“This is not meant to be prescriptive at the very small end of the market: I would not necessarily expect very small publishers to join the body”.
We have therefore provided a definition of “relevant publisher” that captures national newspapers and their online editions, local and regional newspapers and their online editions, and online-only edited, press-like content providers.
Mike Freer (Finchley and Golders Green) (Con)
My local newspapers are concerned about why regional and local newspapers are caught in the new legislation, when they were not found to have had a hand in the scandal that brought us to where we are. Will my right hon. Friend reiterate why they are included?
Maria Miller
My hon. Friend is right that that point has exercised many individuals both within the Chamber and outside. It was clear from Lord Justice Leveson’s report that it was his intention for the local press to be part of the new self-regulatory regime. Equally, he understood that there are clear financial pressures on the local press, as there have been for many years, and that provisions might be needed within the self-regulatory regime that treat them differently. That is something for the press to deal with and I understand that they are looking at it. It is important, however, that the local press are part of the opportunity to have self-regulation. I reiterate to my hon. Friend that it is exactly that—self-regulation—and that there is no compulsion. I hope that that provides the reassurance that he is seeking.
Exemplary damages and costs are designed to cover what might be termed more sophisticated news publishers, and will act as a key incentive to join the new press regulator. It is therefore essential that the definition of “relevant publisher” equates to the publications that we expect to be part of the regulator.
Equally, the definition is not intended to capture a host of activities, including small-scale activity online. It is not intended to capture the news aggregation services of operators such as Yahoo! or MSN, or social networking sites. Nor is it aimed at sites that simply moderate the comments of others or aggregate a series of blogs without any active consideration of the content. By that I mean blog hosting services such as WordPress or Tumblr.
I want to be really clear about the matter, because I know that many hon. Members have examined it in detail. To the extent that a website such as Mumsnet runs an online blog forum, that activity is clearly not covered by the definition of “relevant publisher”, as forums are not covered. The provisions may be relevant to a site such as Mumsnet only if it is in the business of commissioning articles and publishing news stories. Such businesses undertake different activities, one of which may well be publishing news, which would bring them into the scope of self-regulation. However, forums such as the one run by Mumsnet would not be covered.
I also wish to clarify again the effects of the definition of “relevant publisher” on news aggregators. It is not our intention that the provisions should capture news aggregators such as Yahoo!, MSN or Google. News and content aggregators who license or otherwise acquire news-related content from third parties control that content only in as far as they decide how to present it in its totality, and to that extent they are not subjecting the material to editorial control. It is therefore not intended that services providing a platform for bloggers to post content are captured. Again, the control exercised by aggregators is limited to the high-level presentation of content, so news aggregators are not captured by our definition.
We have, however, acknowledged the need for clarity, particularly with regard to small-scale blogs. When the provisions were last discussed in the other place, we undertook to have a period of reflection to assess whether any further clarity would be helpful and could be provided. My officials have since held a number of round-table discussions with small-scale blog sites to understand their concerns further. The amendments that we have tabled, with cross-party agreement, seek to provide that further clarification.
Amendment (a) will add to the list of exemptions micro-businesses where they are a blog or where their publications are merely incidental to their other business. For organisations that publish news-related material incidentally to their main activity, that exemption will cover both online and traditional print. We use a definition of a micro-business commonly used by the Department for Business, Innovation and Skills, which captures any business with fewer than 10 employees and a turnover of less than £2 million. The amendment will ensure that a micro-business that is either a small-scale blog or a website whose publication of news-related material is only incidental to its wider business is not included. That should place many blogs and other small web publishers squarely outside the incentives framework.
Amendment (b) will allow those not captured to get the benefit of the costs incentives if they choose to join the recognised regulator, even though they are not a relevant publisher. That means that those exempted by virtue of the fact that they are a micro-business can choose to gain the benefits of the costs clauses by joining the regulator, providing an incentive for them to join if they so wish and a choice to small organisations, perhaps before they grow in size and inevitably become a relevant publisher. That is an important addition that will help support that part of the market.
I can deal briefly with Lords amendments 17A and 17B. In short, the objective of the new costs regime is to incentivise publishers financially to join the regulator. The intention behind subsection (2)(a) of the new clause “Awards of costs”, originally inserted in the Commons, is to allow costs to be awarded against a regulated publisher only if the claim before the courts is not capable of being resolved through the self-regulator’s arbitration scheme. However, to achieve that effect, the word “not” needs to be inserted into that subsection to avoid the opposite being the case. That was a simple drafting error that is corrected by Lords amendment 17A.
Lords amendment 17B removes subsection (4) of the new clause “Awards of costs”, which we have concluded after further discussion is unnecessary and unduly restrictive.
The clauses to which the Lords amendments relate have been carefully constructed to enable a system of incentivisation, which will form the basis of a new, tough self-regulator for the press in line with Leveson principles. The amendments are far removed from those that the noble Lords Skidelsky and Puttnam, among others, proposed for consideration in this House. Let us be clear that had we not successfully negotiated a cross-party royal charter, the House could well be debating a system of full statutory regulation that would have undermined the freedom of this country’s press.
Mr John Redwood (Wokingham) (Con)
I am grateful to the Secretary of State for trying to give us greater clarity. Does she intend that websites run by political parties and MPs that comment on news and current affairs will not be included in the system?
Maria Miller
As always, my right hon. Friend cuts to the quick with a question that is important to many of us. If he examines the detail of our provisions and exemptions, and the Leveson report, he will see that the intention behind everything that we are doing is to focus self-regulation on those who publish news. I do not believe that any political party or MP intends primarily to publish news. That will be secondary, so it is not our intention that such websites should be the primary focus of the provisions. Obviously, there will be areas in the margins that need further clarification, and the courts will be able to provide that over time.
Dr Julian Huppert (Cambridge) (LD)
I am pleased that we are able to examine these details, because there has been much concern. I would be grateful for guidance on a few specific issues about how the provisions should be interpreted. For example, a lot of multi-author blogs involve people who are self-employed or who work on a voluntary basis. How should the number of employees be dealt with? Will the Secretary of State provide guidance on that, and on what the definition of a blog is?
Maria Miller
It will be full-time employees who are included in the employment measure, which is why it is important that not just employment but turnover is considered. Many organisations utilise a number of self-employed people, hence the twin-track approach.
We have set out what we anticipate being considered a blog, which is about individual opinion being set forth through electronic media. That is relatively straightforward, although as I said to my right hon. Friend the Member for Wokingham (Mr Redwood), there will always be more difficult matters to consider at the margins and the courts will be able to provide further information. We will also provide guidance in the usual way.
The amendments address concerns raised by small-scale bloggers and other small businesses and will ensure that the definition of “relevant publisher” captures the news publishers that were the focus of Lord Justice Leveson’s inquiry. They have the full support of all three major parties in the House, and on that basis I commend them to the House.
Helen Goodman (Bishop Auckland) (Lab)
I am pleased to be able to take part in this debate, which nails down the final details of the recommendations that Lord Justice Leveson made about setting up a new self-regulatory system for the press. When the Bill was introduced into the House a year ago, Lord Justice Leveson had not even reported, so we were fortunate to be able to thumb a lift with the Bill.
On 18 March, on Third Reading, the House agreed to insert new clauses providing for new rules on exemplary damages and costs. They are an essential part of the cross-party agreement on a royal charter, which is part of the new framework of independent self-regulation guaranteed by law.
As the Secretary of State said, the Bill aims to provide publishers with incentives to sign up to the new system of self-regulation that should meet the criteria set out in the royal charter. Publishers that join the recognised regulator will receive protection from the award of exemplary damages in media disputes, the opportunity to use an arbitration service, and cost benefits from having access to the arbitration service—that is one reason why it would benefit local as well as national newspapers. If a complainant chooses not to use the arbitration service, they can still be liable for costs even if they win.
Lord Justice Leveson’s report was about the press, but the original drafting had the unintended effect of catching blogs in the net—a point noted in this House by my hon. Friend the indefatigable Member for West Bromwich East (Mr Watson). That said, Lord Justice Leveson expressed the hope in recommendation 73 of his report that online publishers would also join a regulator. The Bill therefore needed to be amended to ensure that exemplary damages did not apply to blogs, but that they could receive the benefits of joining a recognised regulator. The Lords agreed a number of amendments, including a placeholder amendment, on 25 March.
The Government’s decision to hold a “mini-consultation”—as I think the Secretary of State called it—to pause for reflection and consider the blogosphere was sensible. With the best will in the world, middle-aged Members of Parliament in both Houses are perhaps not absolutely up to speed with the way in which the blogosphere operates among the next generation, but I think we have now got it right. The Labour party agrees with the policy objectives that the Government are seeking to address: to exempt micro-businesses from the definition of “relevant publisher” where they are a blog or their publications are merely incidental to their other business; and to enable such micro-businesses to receive the benefits and cost incentives if they join a recognised regulator. The amendments use the micro-business definition for a small blog as one whose turnover is below £2 million and has up to 10 employees. It exempts such businesses from exemplary damages and enables them to benefit from the cost advantages of an arbitration service if they join a regulator—that last point will be particularly welcome in that community.
Labour supports Lords amendments 17A and 17B and amendments (a) and (b) in lieu of amendment 131, and we will not divide the House in this debate. However, there is a thicket of double negatives, and for those outside the House who are following proceedings closely I ask the Secretary of State to provide assurances and clarity on a couple of points. Will she tell the House whether this approach minimises the risk of gaming, in particular by groups of companies? What is the position of campaigning groups’ newsletters—the right hon. Member for Wokingham (Mr Redwood) raised that point? I thought that Mumsnet would be excluded because its primary purpose is not to publish news—it is clear that motherhood is not a hobby, so it is not excluded on those grounds—or, indeed, UK Feminista. Neither of those is a charity and it might help if the Secretary of State said a little more about the newsletters of campaigning groups.
Will she confirm that access to the arbitration system for those outside the regulatory body is limited to small-scale blogs, and say why she chose that approach? The hon. Member for Cambridge (Dr Huppert) asked about the definition of “blog”, and I assume that the Secretary of State has received legal advice that the word will be properly interpreted. She has already explained why she is addressing only the number of employees, and not those who are self-employed, but if she could elucidate a little on those points it would be helpful and we will be happy to support her this evening.
Dr Huppert
I do not wish to detain the House long but I am pleased that we have finally reached this point and that important details of Leveson are agreed. If I had been asked when I first looked at the Crime and Courts Bill which part I thought would keep us in ping-pong, it would not have been this provision or anything to do with blogs. I do not know whether the hon. Member for Bishop Auckland (Helen Goodman) was referring to me as a middle-aged man. I am the proud holder of a Liberal Democrat Voice “blogger of the year” award, but even I would have struggled desperately to write this provision or make all the definitions. I hope that the Secretary of State has been able to be clear. There will be people who try to game this, but that is true of all legislation. I hope that the Bill has been made as game-proof as possible, while preserving the pleasure of the games that people play on blogs. I am delighted that we are at this point and I will not take up any more of the House’s time. I look forward to the Bill being enacted and I hope that the Secretary of State will clarify those few remaining points.
Maria Miller
I thank the hon. Member for Bishop Auckland (Helen Goodman) for her helpful support as we try to resolve the final details of the Bill. Hon. Members have raised a number of issues in the short period that we have to debate the Bill, and hopefully I can resolve them to everybody’s satisfaction.
I think that by “gaming” the hon. Lady meant the ability of companies to try to buck the system we have set up. It is always difficult to give a categorical assurance on that, but I think our approach minimises the risk of organisations taking such an approach. We have minimised the risk by using the definition of a micro-business, which does not just consider one element—staff—but staff and turnover. Therefore, if an organisation decided to ensure that all its staff were freelancers, it could not then play with its turnover in a way that would make it a micro-business. Equally, individual businesses will find it difficult to disaggregate their businesses in a way that would leave them registered as micro-businesses, and then duck the system without compromising the way in which they operate on a day-to-day basis. Furthermore, a court will be capable of looking at the facts of a case to see whether an organisation has attempted to get around the rules, and that would be a material consideration. If an organisation was trying to circumvent the rules in the way it structured itself, the usual sanctions would be available.
We are interested in many different organisations, but particularly campaigning groups. A number of other exemptions already exist in the definition of “relevant publisher” that deal with campaigning newsletters—a point that the right hon. and learned Member for Camberwell and Peckham (Ms Harman) and I have discussed on a number of occasions. A public body or charity that publishes news-related material in connection with carrying out its functions, or a person who publishes a newsletter, circular or other document relating to their business that contains news-related material only incidentally, will not be caught by the self-regulatory approach. Such things will be exempt from these measures, which is important. News, and the delivery and publication of news, is not central to a company’s business, and I underline that point for all questions raised by hon. Members. Hopefully, that will provide some certainty on campaigning groups.
The fourth point raised by the hon. Member for Bishop Auckland was access to arbitration for those that may not be termed as “relevant publishers”, other than those that are micro-businesses—excuse me, Mr Deputy Speaker, for getting into the weeds with this, but it is necessary to answer the hon. Lady’s questions. Our consideration of micro-businesses in connection with blogging was to ensure that we did not unintentionally capture those businesses within the self-regulatory system, and also to ensure that those businesses were able—should they choose—to opt in to the self-regulatory part of the framework if they felt that was beneficial. It was never our intention more broadly to allow people to become a “relevant publisher”, not least because that would be outside the scope of today’s discussions. It is not our intention to allow people who are not relevant publishers in that way to have access to that status over and above the exemption we have outlined. Anything to do with the running of the self-regulatory regime is for the press to consider in more detail. We did not intend to cover that in our proposals today—the hon. Member for Bishop Auckland has raised that matter with me.
Partnerships (Prosecution) (Scotland) Bill [Lords]
(11 years ago)
Commons ChamberRead Full debate Read Hansard Text Read Debate Ministerial Extracts
The Parliamentary Under-Secretary of State for Scotland (David Mundell)
I beg to move, That the Bill be now read the Third time.
The Bill takes forward the proposals of the Scottish Law Commission to address the loophole in Scots law that prevents the prosecution of partnerships that have dissolved. It addresses the limitation of the law in Scotland which meant that attempted prosecutions could not proceed following the serious fire at Rosepark nursing home in Uddingston, Lanarkshire on the night of 31 January 2004, when 14 people tragically lost their lives. Rosepark was run by three individuals who had come together to form a business partnership. Following the fire, the partnership dissolved. The partnership, as employer, was alleged to have committed offences under the Health and Safety at Work Act 1974. The Crown Office made three attempts to prosecute the partnership, but as the High Court had held that the partnership ceased to exist on dissolution, the prosecutions could not proceed.
In November 2012, the Bill was introduced to Parliament by the Advocate-General for Scotland. The Bill is one of only three Scotland-specific Bills introduced in Westminster since devolution. It reminds us that Scotland has two Governments and two Parliaments, both with their own contributions to make in improving the lives of people in Scotland.
The Bill marks a significant milestone. This is the first occasion when the House of Lords special Public Bill procedure for Law Commission Bills has been used in relation to Scottish Law Commission proposals. The special procedure allows non-controversial legislation to sidestep the competition for parliamentary time on the Floor of the House. The Bill demonstrates why that procedure is so valuable.
The Bill progressed through Committee in both Houses, allowing close and robust scrutiny of each of its clauses, with good opportunity for debate. It has received broad consensus from all sides. I thank the hon. Member for Glasgow North East (Mr Bain) and all hon. Members who have participated in the process.
The Government are grateful to the Scottish Law Commission, and in particular to Patrick Layden, who has worked tirelessly alongside the Advocate-General for Scotland and the Scotland Office to produce a Bill that provides a very simple, very sound solution that ensures that partnerships and culpable partners cannot evade prosecution by dissolving.
The support demonstrated by hon. Members is gratefully noted. We are particularly grateful to the hon. Member for Lanark and Hamilton East (Mr Hood), in whose constituency the Rosepark nursing home was situated. We also gratefully note the support of the Scottish Government. We are immensely grateful for the support demonstrated by the Lord Advocate, the Faculty of Advocates and the Law Society of Scotland, which have all broadly welcomed the Bill, in giving evidence to the special Public Bill Committee in the other place.
The provisions of the Bill are to be commenced the day after Royal Assent. The Bill makes valuable and necessary reforms to the law of partnerships in Scotland and I commend it to the House.
Mr William Bain (Glasgow North East) (Lab)
The Opposition endorse Third Reading. Throughout previous stages of the Bill both in this House and in the other place, right hon. and hon. Members have kept very much at the forefront of our minds the families and the 14 people who lost their lives in the dreadful fire at Rosepark nursing home in Uddingston, south Lanarkshire, which was caused by an earthing fault at the back of an electrical distribution box in a storage cupboard at the nursing home.
As I said in Second Reading Committee, a fatal accident inquiry in 2011 chaired by Sheriff Principal Brian Lockhart established that some or all of the lives lost could have been saved if a risk assessment had been conducted and if it had led to the taking of reasonable precautions. That could have avoided or minimised the loss of life. The inquiry found fault with the maintenance of the electrical installation at the care home; inadequate fire safety and drills; inadequate management of fire safety, which was found to be systematically and seriously defective; and weak interaction between the nursing home and Lanarkshire health board.
The laws we make in this House can never repair the feelings that arise from the loss of loved ones, but the Bill will ensure that others never suffer a similar lack of closure as a result of flawed processes in the criminal law caused by deficiencies in the law of partnerships in Scotland. We should therefore welcome the work of the Scottish Law Commission on the matter, its continuing contribution to keeping the laws of Scotland made by both Parliaments under review, and its recommending modernisation when necessary in the public interest.
In particular, we welcome the work predating the Bill that was done on the consultation process by the commission’s chair, Lady Clark, the former Member for Edinburgh Pentlands and former Advocate-General for Scotland; by the commission’s previous chair; by Lord Drummond Young; and by Mr Patrick Layden QC. Although the Scottish Law Commission consulted widely on whether it should attempt to deal with the problem by virtue of a comprehensive reform of partnership law, in the end, pending consideration of wider reforms, the commission settled on the more targeted solution of permitting partnerships to have a degree of continuing legal personality for a limited period in terms of criminal proceedings and prosecutions.
The Opposition welcome the fact that the Bill shows this Parliament’s continued belief in the importance of the reform of private law in Scotland under areas reserved to the UK Parliament under the Scotland Act 1998. Scotland has two Parliaments that make laws on behalf of its people. It is noteworthy that the Bill is the third Scotland-only Bill on a reserved matter to be debated in this House since the devolution of power to the Scottish Parliament in 1999. I hope there will be many more of them in the future, should the people of Scotland choose to remain within the United Kingdom in the referendum to be held next year.
The tragedy at Rosepark nursing home in 2004 claimed the lives of 14 residents. However, because the partnership that owned and managed the home was dissolved after the fire, but before the Crown Office in Scotland could initiate any proceedings for prosecution, the partnership could not be prosecuted. That principle was established in the case of Balmer v. Her Majesty’s Advocate in 2008. Following the decision in that case, the Scottish Law Commission published a discussion paper and consulted on possible options for reforming the law of partnerships in Scotland in this area. That consultation led directly to the Bill before the House this evening.
It is an important principle of commercial law that the legal personality of a company or partnership differs from that of the directors or partners. It is possible to prosecute a partnership in Scotland quite separately from the individual partners under Scots criminal law. Indeed, it is vital that we uphold the concept that legal persons, as well as the individual partners in their own right, can be subject to liability for actions deemed to be breaches of the criminal law.
Another core principle of the law of partnerships in Scotland is that of joint and several liability for civil and criminal obligations incurred by the partnership. Should a partnership be convicted of an offence following prosecution and be subject to a fine, then any or all of the partners may be held liable for payment of any such fine imposed by the courts. That has been seen as critical in ensuring that the law can attach responsibility for payment to at least one member of the partnership. That partner then has the right to seek recompense for the outstanding share of the financial liability thereby incurred from the other partners, through a civil action under the partnership agreement and the Partnership Act 1890.
The Bill closes the loophole in the law that was exposed by the Rosepark tragedy. It will permit a prosecution to be brought against a dissolved partnership up to five years following the deemed dissolution in respect of conduct that arose out of the partnership while it was still in existence. Actions in criminal law may also be brought against partnerships where the composition of partners or the membership structure have altered, where partners have left, or new partners have joined. Any member of a partnership may thus still be liable for any criminal offences committed while a member of the partnership and through any change in composition.
Circumstances that could give rise to prosecutions under the clause include: potential breaches of section 36 of the Health and Safety at Work etc. Act 1974; cases where an individual’s acts or omissions have been a cause of the offence; cases where an individual is held guilty, art and part, of a common-law or statutory offence; cases where an individual has aided, abetted, counselled or procured the commission of an offence under statute law; or cases where an individual has committed an offence with their consent or connivance, or even through neglect. The range of offences potentially liable for commission by individual members of a partnership was significantly widened by the Scottish Parliament, through section 53 of the Criminal Justice and Licensing (Scotland) Act 2010.
Should a partnership be convicted of an offence, any legal rule, whether in statute or common law, relating to the liability of the partners, applies as if the partnership had not been dissolved. This permits joint and several liability for any fine imposed by the courts following a successful prosecution, in line with sections 4 and 9 of the Partnership Act 1890 and subject to the provisions in clause 3 of the Bill. Any fine imposed following a conviction may be recovered against the assets of the partnership, or any or all of the individual partners, each of whom would have a right to claim a remedy for the other shares from assets of the partnership, or from the other partners’ personal assets. In some statutes, such as the Health Act 2006, the law restricts the payment of fines to the partnership assets only, but for a dissolved partnership under the Bill that rule will not apply, because if a partnership is dissolved there will be no partnership assets and any fine might otherwise prove to be unenforceable—that would be unacceptable.
The sole element of contention that arose during the passage of the Bill, in this House and in the other place, stemmed from clause 4, under which it is possible for someone to have joined a partnership after the commission of a potentially prosecutable offence and then face liability for some or all of any penalty applied by the court following a finding of guilt, despite the fact that that person was not involved at the partnership at the time of commission of the offence. That was a significant concern for the Law Society and others in Scotland, as many businesses are organised through the partnership model.
I moved a probing amendment in Committee, following similar amendments that had been moved in the other place, to test the arguments as to whether an exemption could be created for innocent partners who become members of a firm, but are unaware of any potential criminal liability that could give rise to conviction and the imposition of a fine, who then face demands to meet a share or even the entirety of a fine from personal assets in the absence of partnership assets or personal assets from the pre-existing members of the firm. We were reassured by the Commission that it is likely to keep the operation of this provision under review, and that a more comprehensive analysis of the potential reform of partnership law remains a possibility. In that spirit, we were happy to withdraw the amendment.
In conclusion, the Bill closes an important loophole that the unsuccessful attempts to prosecute the owners of Rosepark nursing home, following the fatal fire, brought to light. We cannot remove the suffering that the families and loved ones of the deceased have experienced in these past nine years, but we can ensure that, by enacting these reforms, other people affected by the conduct of partnerships are never put in a similar position again. That is the best tribute we in this Parliament can make to the 14 people who so tragically and unnecessarily lost their lives. For those reasons, the Opposition strongly support the Bill.
Mr Mike Weir (Angus) (SNP)
I would also like to add my support to the Bill. You may be witnessing an almost unique occasion, Mr Deputy Speaker: all parties in this House and the Scottish Government and Parliament support the Bill and are anxious for it proceed. As has been said, the genesis of the Bill was the Rosepark fire—a great tragedy in which many people unnecessarily lost their lives—and the inability, because of this quirk in Scottish partnership law, to prosecute. It is important that that is put right.
We had a good debate in Committee. The speech from the hon. Member for Glasgow North East (Mr Bain) probably went on as long as the Committee stage, but the Bill was considered in Committee in detail. As he said, the Law Society of Scotland still has a concern—I should perhaps declare a tangential interest as I used to be a member—regarding its impact on partnerships. We went into this in some detail, and I think none of us could come up with a way of dealing with this particular issue. However, it is important to make the change, irrespective of slight concerns. I hope the Bill proceeds. As the hon. Gentleman rightly said, there is nothing we can now do for the people who so tragically lost their lives at Rosepark, but we can ensure that it does not happen again. We have come together to do that.
The Minister and the hon. Member for Glasgow North East were slightly naughty to present the Bill as an argument for the Union, as it could have been introduced in any place that had the power to do so, whether in Edinburgh or London. The hon. Member for Glasgow North East said that this was the third Scotland-only Bill on a reserved matter to be debated in this House since devolution. It will undoubtedly be the last—the next will be in an independent Scottish Parliament.
David Mundell
With the leave of the House, I will seek to conclude this debate on the basis of agreement. I am sure that this will not be the last Bill affecting only Scotland brought before the House, but we will leave those debates for another day.
I concur with the hon. Members for Glasgow North East (Mr Bain) and for Angus (Mr Weir) that the Bill will, I hope, go some way to set right the wrongs of the Rosepark fire and bring some comfort to the families of the victims on that terrible evening.
I would like to thank members of staff in the Scotland Office and the Office of the Advocate General who worked hard to bring the Bill before the House. I am pleased that we can now move forward with it in a spirit of consensus in order to deal with an identified anomaly in the existing laws of Scotland. I commend the Bill to the House.
Question put and agreed to.
Bill accordingly read the Third time and passed.
Section 5 of the European Communities (Amendment) Act 1993
(11 years ago)
Commons ChamberRead Full debate Read Hansard Text Read Debate Ministerial Extracts
20:17 - The House divided: - Ayes: 264 / Noes: 216 - Question accordingly agreed to.
The Financial Secretary to the Treasury (Greg Clark)
I beg to move,
That this House approves, for the purposes of section 5 of the European Communities (Amendment) Act 1993, the Government’s assessment as set out in the Budget Report, combined with the Office for Budget Responsibility’s Economic and Fiscal Outlook, which forms the basis of the United Kingdom’s Convergence Programme.
I welcome this opportunity to listen to Members’ views on the British Government’s submission to be made this year under section 5 of the European Communities (Amendment) Act 1993. It is nice to see the hon. Member for Nottingham East (Chris Leslie) in his place. I think we have spent more time opposite each other than we have with our respective spouses in recent weeks.
As in previous years, the Government will provide information to the European Commission on the UK’s economic and budgetary position in line with our commitments under the EU stability and growth pact. This submission, known as the convergence programme, is a legal requirement under agreements this country has entered into, and of course the British Government take such commitments seriously. One must also say, however, that its very name represents something of a relic from a past age—a time when Britain was still ruled by a Government committed in principle to joining the single currency. I can assure the House that that era is well and truly dead and buried.
Members might well ask what purpose is served by this annual exercise and the associated debate in the House. [Interruption.] I thought that this might find an echo in the Chamber. Without wishing to anticipate Members’ contributions, which I look forward to, I would like to suggest three areas for this afternoon’s discussion. I wish first to debate British economic policy within the still relevant context of Europe; secondly, to consider the co-ordination of national economic policies across the EU; and thirdly to reflect on our great good fortune in not having joined the single currency, despite the siren voices heard in this place and elsewhere—thanks, in no small measure, to those who had the courage and foresight to speak against British involvement at a time when their warnings were subject to such derision.
Kelvin Hopkins (Luton North) (Lab)
I remember a time when all three major parties, the TUC and just about every good and great person across the land supported joining the exchange rate mechanism. I was one of those who from the beginning said that we should not do so. At the moment, we are all against the single currency, but I remember a time when even the Minister’s party was moving in that direction.
Greg Clark
I do not think that that is entirely right, although I happily acknowledge that the hon. Gentleman was on the side of right throughout. I remember working for the Foreign Secretary when he was leader of our party. In November 1997, when, as the hon. Gentleman said, the received opinion was that our joining was inevitable, my right hon. Friend made the courageous decision to set out in a lecture to the conference of the CBI, which then was in favour of joining, the forensic reasons why it would not be in our interests. He committed then, right at the beginning of the parliamentary process that resulted in these measures, to campaign for Britain to stay outside it. While I acknowledge the hon. Gentleman’s distinguished record, I think he would acknowledge that the Conservative party was the first party to commit itself to oppose these measures.
The Government plan to make their submission by 30 April, with the approval, we hope, of both Houses of Parliament. It explains the Government’s medium-term fiscal policies, as already set out in the 2012 autumn statement and Budget 2013, and includes the Office for Budget Responsibility’s forecasts. We think it right and proper to draw from previously published documents presented to Parliament, rather than incur the cost and time to produce bespoke documents for this purpose.
Mr William Cash (Stone) (Con)
Is my right hon. Friend aware that the very document to which he refers states:
“The IMF forecasts UK GDP per person to grow faster than the rest of the G7 between 2012 and 2017, with the exception of the US”?
Of course, he will have read the comments made by Madame Lagarde only yesterday. Does he not find them a little incongruous, given that the IMF is now taking rather a different view?
Greg Clark
The IMF is considering its view, and we will see what it has to say in the months ahead, when it issues its review. We have always been clear that, as we have advised all EU member states, keeping control of finances is an important precondition for growth. That is an important matter.
As I said, we have been parsimonious in not generating excess quantities of paper. Members will be aware—certainly my hon. Friend the Member for Stone (Mr Cash) will be—that we did not follow the advice that other countries followed and align our financial year to fit in with the norm in Europe. We think it right to stick with our financial year and make use of the documents presented.
With the Budget announcement having taken place on 20 March, shortly before Easter, I appreciate that the timetable was tight, but we made every effort to provide early copies of the convergence programme to the House and the other place in advance of this debate.
Chris Leslie (Nottingham East) (Lab/Co-op)
What was going on with the Order Paper before the debate? I think that the Leader of the House, or perhaps the Minister, tabled a motion not to have this debate, but to kick it up to a Delegated Legislation Committee. I understand that some hon. Members, including the hon. Member for Stone (Mr Cash), objected, and now we are not debating whether to have the debate upstairs. What was going on? Why did the Government try to shove this out of the line of sight?
Greg Clark
The hon. Gentleman is aware that I am always happy to debate with him, especially on the Floor of the House, which I very much prefer. He will know that at this time in the parliamentary Session, as we approach the end of the Parliament, the business managers—the Leader of the House is here—are particularly jealous of the Chamber’s time, including in respect of the sorts of debate we have had today. They had the foresight, however, to anticipate being fortunate enough to have some time today on the Floor of the House. It was right, therefore, that we agreed with the proposal, and here we are today.
As I said, we have economically re-versioned the Budget 2013 document to set out the Government’s assessment of the UK’s medium-term economic and budgetary position. As confirmed by the independent OBR, the UK economy is still recovering from the biggest financial crisis in generations, one of the deepest recessions suffered by any major economy and a decade of hollow growth built on unsustainable debt levels. In June 2010, the Government set out a comprehensive strategy to deal with the deficit, protect the economy and provide for the foundations of recovery. This economic plan combines monetary activism with fiscal responsibility and supply side reform.
The Government are making progress. We have restored fiscal credibility, thus enabling an activist monetarist policy and the automatic stabilisers to support the economy. The deficit has been cut by a third over three years and is projected to fall in every year of the forecast. The OBR has judged that the Government remain on track to meet the fiscal mandate one year early, while 1.25 million private sector jobs have been created. Employment is just below record levels and we have kept interest rates at near-record levels, helping families and businesses.
However, there is much more to do. It is important that we understand why the road to recovery has been more difficult than was first anticipated. Although Opposition Front Benchers profess an internationalist outlook, they sometimes debate economic policy as though Britain’s economy was closed off from the rest of the world and invulnerable to other countries.
Mr David Nuttall (Bury North) (Con)
Given that we have faithfully submitted convergence programme documents every year for a number of years, is the Minister as surprised as I am that some of our continental neighbours have not taken a bit more notice of the path that this Government have pursued or taken a bit more action to get their spending in line, as this Government have?
Greg Clark
In fact, some countries are recognising that, but we want to set an example. It is important that we stick to our plans and continue to benefit from the confidence that the markets have shown through the level of interest rates. We also say in our deliberations in Brussels, as well as making the point in budget discussions, that when times are difficult, belts need to tightened.
Kelvin Hopkins
I must say that I am astonished. It is almost as if no one in the Chamber has read the newspapers over the weekend and seen the IMF report that it got the premise for austerity completely wrong. Owing to a mistaken figure in a spreadsheet, we are all going for austerity, which is a terrible mistake. Is that not the reality?
Greg Clark
I do not agree with that. The hon. Gentleman will be aware that the IMF recommends to many countries around the world, not least in Europe—this is the point my hon. Friend the Member for Bury North (Mr Nuttall) referred to—that they should get their public finances in order.
When the Office for Budget Responsibility revised its forecast for global economic growth—and eurozone growth in particular—and world trade downwards, that had an inevitable impact on UK growth, given that the euro area is the destination for 40% of UK exports. Over the past year, net trade was the key factor in the underperformance of the economy relative to earlier OBR forecasts, as well as in the downward revision of the forecasts this year and the year after. Fiscal consolidation, on the other hand, has not had a larger drag on the economy than the OBR expected in June 2010. Indeed, the UK’s fiscal situation argues strongly in favour of maintaining our commitment to deficit reduction.
Opposition Members sometimes accuse us of going too far, too fast, but there is further to go and we must get there as fast as we sensibly can, not least because so much rests on the market-tested credibility earned by this Government. The near historic low gilt yields that underpin the low interest rates that are so important to millions of households and businesses cannot be put at risk. As shown by global developments, the consequence of losing market confidence can be sudden and severe. A sharp rise in interest rates would be particularly damaging to an economy weighed down by the burden of so much public, corporate and personal debt, built up during a time when it should not have been.
Mr Cash
The OBR’s executive summary states:
“Public sector net debt…is forecast to peak at 85.6 per cent of GDP in 2016-17, rather than 79.9 per cent a year earlier as in our December forecast.”
In reality, debt is simply out of control, although much of it is the responsibility of the previous Government.
Greg Clark
Of course my hon. Friend is right that the inevitable consequence of running a deficit is that debt increases. It continues to be our purpose to reduce the deficit and return the economy to a balanced budget in order to start to pay down debt, and it is important that we should do that.
Budget 2013 also set out measures to equip the UK to compete in a global race. The Government will give every business and charity a £2,000 allowance towards their national insurance contributions from April 2014, benefiting more than 1 million businesses. We will achieve the ambition for the UK tax system to be one of the most competitive in the world, which includes a further cut in corporation tax to 20%—the joint lowest in the G20—from April 2015. We will increase capital investment plans by £3 billion a year from 2015-16. Public investment will be higher on average over this Parliament and the next than under the previous Government. We will devolve a greater proportion of growth-related spending to local areas from April 2015, in response to Lord Heseltine’s review.
As well as action in the UK to tackle the economic challenges that we face, progress needs to be made to tackle the crisis in the euro areas. However, the growth challenges in Europe continue to be serious, as every Member is aware. We have seen a welcome fall in borrowing rates, particularly for Spain and Italy, from the high levels that they reached last summer, but recent events in Cyprus remind us—and leave us in no doubt—that the euro area continues to be a fragile environment. Only a sustained period of successful reforms and improvements in financial markets can lay the foundations for growth. Economic activity in the European Union remains subdued. In the euro area, most of the so-called peripheral economies are in pronounced recessions, with weak labour markets, adverse credit conditions and an ongoing process of deleveraging all weighing on growth.
Structural reforms at the national level should be supported by the co-ordination of progress towards freer markets at the EU level. The improvement of the single market, regulatory reform and free trade agreements can all help to improve the growth prospects of every country in the EU at a minimal cost. This is a critical agenda that the UK and other like-minded states have advanced at successive European Councils, including in March, and we will continue to push.
Mr Cash
My right hon. Friend says that it is critical that we enter into EU free trade agreements. I hope he appreciates that under the majority voting system, the power of the European Commission under the Lisbon treaty means that at present our influence is only 8% at maximum—although it will shortly rise, albeit to only 12%. The whole policy will effectively be driven by the European Union and its objectives, which are largely dominated by Germany. It will not be in British interests.
Greg Clark
It is possible for our influence to go beyond our voting weight, just as there are Members of this House—I might include my hon. Friend in this—whose influence goes beyond their proportional representation in this place. I hope he agrees with that.
It is important to maintain momentum on bilateral EU free trade agreements. Ninety per cent of global growth will come from outside Europe after 2015, so the EU needs an outward-looking trade agenda. A free trade agreement with the United States of America is, and must be, a major opportunity that should be pursued with all vigour. It is estimated that EU free trade agreements that are currently under way or in the pipeline could add £200 billion to EU GDP and create 2 million jobs across the EU. We welcome the European Commission’s stated commitment to bringing forward concrete proposals to reduce regulatory barriers for small and medium-sized enterprises. That is long overdue and we look forward to seeing those proposals in June.
It is estimated that removing all barriers in the single market would increase UK GDP by about 7%, while prices could fall by 5% due to increased competition. The single market already adds €600 billion a year to the EU’s economy. Further progress is possible. Ambitious implementation of the services directive by all member states could result in increased national incomes. Service liberalisation would be particularly beneficial to the UK, as services are an area of enormous comparative advantage, as we know, and the UK has had a trade surplus with the EU in services since 2005.
Mark Reckless (Rochester and Strood) (Con)
The Financial Secretary cites a number of reports that credit apparently enormously large gains to the single market and, potentially, other trade arrangements. May I ask him to look at the original reports with a certain scepticism? When I used to work with him, I think he would have been disappointed if I had done my analyses in the same slapdash way.
Greg Clark
One of the reasons why I was pleased to employ my hon. Friend was his forensic and questioning eye. He is absolutely right that when we look closely at the measures and their estimated impact, we should make our own assessment. However, I think that all of us, including my hon. Friend, would agree that a genuine single market in, for example, energy—an area in which he and I have an interest—could help to increase competition in the EU. As we know, competition is one way we can drive efficiency, which is very much in the interests of all citizens in this country and across the EU.
In addition to structural reforms involving each EU member state and the co-ordination of free trade policies at the EU level, we need reforms in the way the EU works. In his speech of 23 January, the Prime Minister proposed certain principles for reform. He said that the EU had to improve its competitiveness, to become a more flexible organisation, to ensure that its rules were fair for all members and to allow power to flow from the EU to its members and not just the other way around. He also said that the EU had to improve its democratic accountability and to re-engage with voters across Europe. It is national Parliaments that provide the true source of real democratic legitimacy and accountability in the EU. The fact that this debate tonight is being held at the behest of the Chairman of the European Scrutiny Committee serves only to underline that important fact.
Those objectives are complicated by the presence in the EU of the eurozone. Britain has an immediate interest in the stability of the single currency, and we need to be aware of the changes that a more tightly integrated euro area will bring to the EU’s present structure. It is important that we ensure that the EU continues to work for all its members, and that the interests of those outside the single currency should be acknowledged and, more specifically, protected. In particular, it should be understood that whatever binding surveillance eurozone members might agree on, Britain will not be bound by it.
As I said earlier, the convergence programme is, by its very nature, something that harks back to the days when it was simply assumed that Britain was on a one-way route to monetary union across the EU. As the hon. Member for Luton North (Kelvin Hopkins) has suggested, hindsight is a wonderful thing, but let us not forget that, at that time, he and many Conservative Members had the foresight to see any such convergence as the wishful thinking that it was—and, to a certain extent, still is. Those Members included my right hon. Friend the Member for Richmond (Yorks) (Mr Hague), now the Foreign Secretary. As the newly elected leader of the Conservative party in 1997, he had this to say about the idea of dragging Britain into the single currency:
“What are the chances that we will converge in the near future? What are the chances we will converge for ever, without ever diverging again? And would it be wise to run our economy so as to make it converge rather than prosper in its own right?”
Those were wise words, and I look forward to hearing many more in this debate.
Chris Leslie (Nottingham East) (Lab/Co-op)
That was a paean of praise from the Minister for the right hon. Member for Richmond (Yorks) (Mr Hague); it is a pity that there was not quite so much for the Chancellor of the Exchequer. One of the strange things about this debate is the strong sense of having been here before to debate this issue. Indeed, it was about this time last year that we did so—and, sadly for me, the year before that as well.
Chris Leslie
In my case, it is not 20 times. I have responded to these debates only since the general election.
The key to the debate is the Budget Red Book. I suspect that many Members are not in the Chamber this evening because they have looked at the screens advertising the debate and seen a reference to some obscure European legislation, but I draw all Members attention to page minus 2 at the very beginning of the Red Book. In tiny 9-point font, beneath the statement that the Red Book is printed on paper containing 75% recycled fibre content minimum, it states:
“The Budget Report is presented pursuant to section 2 of the Budget Responsibility and National Audit Act 2011 and…constitutes the Government’s assessment under section 5 of the European Communities (Amendment) Act 1993 that will form the basis of the Government’s submissions to the European Commission”.
If Members knew that we were debating whether the Chancellor’s assessment of the economy was a true and accurate reflection of what is going on in the UK economy, for the purposes of that Act of Parliament, they would be absolutely astonished.
We have obligations under the Maastricht treaty articles; that is essentially what we are talking about when we refer to the European Communities (Amendment) Act 1993. Article 103 states:
“For the purpose of this multilateral surveillance”—
I know that those words stick in the throats of some hon. Members—
“Member States shall forward information to the Commission about important measures taken by them in the field of their economic policy”.
Mrs Anne Main (St Albans) (Con)
Is the hon. Gentleman implying that the Opposition Benches are empty because none of his right hon. or hon. Friends could be bothered to come and scrutinise this document?
Chris Leslie
These Benches are not massively more empty than those on the Government side of the House. She will have to accept that this can, at face value, appear to be quite an obscure issue. [Interruption.] There are not many people on her side of the House, but I do not want to get into a contest on that matter.
Kelvin Hopkins
I want to pay my hon. Friend a compliment by saying that Labour Members do not need to turn up because they have such confidence in our shadow Minister and they know that he will speak for us.
Chris Leslie
That is one way of looking at it.
The point that concerns me is that the Government have in recent days tried to shove this issue off the Floor of the House and sweep it upstairs to a Delegated Legislation Committee. The Minister has said that this is a busy time of year and that the Government do not want to waste the House’s time with these questions, but we are already faced with an opaque description of the legislation, so it is no wonder that they are trying to push it out of parliamentary time. It is, in fact, the kind of legislation that ought to be advertised more to hon. Members.
Mr Cash
I would no doubt have a lot in common with some of the remarks made by those who were critical of the Maastricht treaty. Will the hon. Gentleman be good enough to tell me whether he would like to leave the existing treaties, and to describe the basis on which this nonsense, this farrago, is now being conducted?
Chris Leslie
Well, this does feel like rather an anachronism, but we have legal obligations under those treaties. No doubt there will be revisions, and some of the reporting requirements ought to be considered afresh, but my principal concern is whether it is right for the House to endorse the Red Book as a true and accurate reflection of what is happening in the UK economy. In my view, the Government must be kidding if they are saying that the Red Book reflects the facts. It is more like a work of fiction. They have been spinning furiously as the key indicators have taken a turn for the worse, as my hon. Friend the Member for Luton North (Kelvin Hopkins) said. In fact, the Red Book is little more than a vanity exercise cloaked in an official publication. It revolves entirely around the Chancellor’s need to retro-justify his failing economic ideology.
I invite hon. Members to look seriously—and without cracking up—at page 1 of the Red Book, and to ask themselves genuinely and dispassionately whether it is a true reflection of what is happening in the UK economy. The first line states:
“The Government’s objective is to…build…a fairer society”.
Well, tell that to those who are struggling with the new bedroom tax while they watch the great and good millionaires of this country rake in a typical £100,000 tax cut, thanks to the reduction in the 50p rate of income tax for those earning more than £150,000. So much for a fairer society!
Here is another one:
“The Government’s plan…is based on…fiscal responsibility to deal with our debts with a credible debt reduction plan”.
That is in total contradiction with the first page of the Office for Budget Responsibility report, which states plainly that the deficit reduction plan has “stalled”. That is the word that the OBR uses. No one would think from reading the Budget Red Book that the Government had presided over an increase in the national debt of 38% during their three years in office.
Mark Reckless
Does the hon. Gentleman believe that the solution is to borrow more?
Chris Leslie
I am sorry to have to tell the hon. Gentleman that the Government are already borrowing more. We shall see the borrowing figures tomorrow, and we shall see what happens to their strategy. The deficit reduction plan has gone. It has vanished. It has totally disappeared. It is a dead plan. It is no more. It is deceased. It is incumbent on Government Members to realise that they need a different strategy for deficit reduction; they need one that will succeed.
I want to return to the first page of the Red Book, which we are asked to approve as a true reflection of the state of our economy. It states that
“the Government is committed to keeping costs down for families to help with the cost of living”.
Tell that to the typical household now being asked to pay an extra £891. People are worse off because of the measures taken since 2010—not to mention the shrinking real wages relative to rapid price rises. How about the following quote for masterly understatement? It states at the foot of the page that we are experiencing
“a more subdued and uneven recovery than expected”.
Our economy shrank in the last three months of 2012, and we will see whether we are recovering when we see the growth figures for the current quarter on Thursday. How on earth could that be viewed as a recovery? This is an exceptionally disingenuous document. Reading page 1 of the Red Book is enough to make any dispassionate observer double-take their grip on the tough realities of the world around them.
We should therefore dwell for a moment on the real-world evidence. A week is certainly a long time in the Chancellor’s political lifetime—what a week has just passed. The unemployment figures were exceptionally grim. The Bank of England’s latest release on trends in lending showed that, measured annually, the amount of lending to UK businesses from banks and building societies fell in the three months to February. The Bank of England said that lending to businesses fell by £5 billion during those three months and that the decline was broad based across all sectors. So much for funding for lending.
Way before we got to the Budget, we suggested that the Chancellor should take steps to reform the funding for lending programme, but he did not do so in the Budget. It should not take an intervention from the International Monetary Fund to prick up the Chancellor’s ears and make him realise that he needs to do something about funding for lending. Ministers will have to be far more adept and fleet of foot than that.
The Treasury Select Committee said last week that it was by no means clear that the cornerstone of the Budget—the Help to Buy housing scheme—would benefit first-time buyers and, as my hon. Friend the Member for Luton North alluded to earlier, the academic methodology underpinning the key paper written by the Chancellor’s favourite economic theorists—Carmen Reinhart and Kenneth Rogoff—was discredited when a graduate student found a fatal flaw in their excel spreadsheets that supposedly underpinned the whole extreme austerity course advocated by the Treasury.
Despite the usual diplomatic finesse employed by the IMF towards its affiliating member states, its chief economist Olivier Blanchard said that the Chancellor was “playing with fire”. A year ago, the IMF was forecasting growth of 2% this year, but it is now expecting growth of just 0.7%. It was a serious mistake for the Chancellor to ignore the IMF’s calls for a reassessment of fiscal policy in the Budget, and it is right to repeat its warnings. Even Christine Lagarde, not known for departing from the Chancellor’s opinions on these matters, said that the pace of fiscal consolidation
“has to be adjusted depending on the circumstances and given the weak growth that we have observed lately because of reduced demand addressed to the economy”
and that
“now might be the time to consider”
doing so.
Mr Nuttall
We are not talking about whether this document should be submitted to the IMF; we are talking about submitting it to the EU. If we compare our growth with that of the eurozone, the EU’s own body, EUROSTAT, is forecasting that growth in the eurozone will go down by 0.3% and that ours will go up by 0.9%.
Chris Leslie
To whomever we are asked to submit this document—to the IMF, the EU, the hon. Gentleman’s constituents or his mother-in-law—I would be embarrassed, if I were the hon. Gentleman, to stand behind it as a true reflection of the state of the UK economy. To cap it all, last week, we saw another humiliating blow to a Prime Minister and Chancellor who kept saying that our triple A credit rating was the No. 1 test of their economic and political credibility.
Mr John Redwood (Wokingham) (Con)
Given that the latest Government plans envisage borrowing £60 billion more in 2014-15 than in the original summer 2010 plan, how much more than that extra £60 billion borrowing would the hon. Gentleman recommend?
Chris Leslie
Unfortunately, we are not likely to have a general election until 2015. I would be grateful if hon. Members did whatever they could to bring that forward a little, but heaven knows what state the economy will be in—even by the time we get to 26 June, which I believe encompasses the spending review period. I am sure that yet further revisions of these figures, which keep changing like shifting sands before us, will be made. We simply do not know what a future Labour Government will inherit—hopefully in 2015. I will get back to the right hon. Gentleman nearer the time. One thing seems clear to me: we have to take some bold action to stimulate the economy, rather than adopt this laissez-faire, arms-folded, non-interventionist approach. Even the Financial Secretary used to disparage that, but he has now signed up wholly to it.
Greg Clark
Does the hon. Gentleman agree with the right hon. Member for Morley and Outwood (Ed Balls), who said:
“Long-term interest rates are the simplest measure of monetary and fiscal…credibility”?
Chris Leslie
Long-term interest rates reflect a number of factors. Government Members would like to think that low bond yields were a reflection of fiscal policy measures alone—[Interruption.] The Minister should hear me out. He likes to think that that is the one test. As I say, it used to be retention of the triple A credit rating, but that has gone, so something else has had to be found. Long-term bond yields, however, are also a reflection of who is purchasing them. I do not know whether the Minister can help us out by elaborating on who exactly is purchasing the Government bond yields, because the Bank of England seems to be doing an awful lot. One branch of the UK Government institutions is helping out the other branch of Government institutions—depressing, of course, that yield. The Minister should not be too proud of market expectations that things are going to be so bad for so long that our interest rates are at the ultra-low level. It is not a reflection of fiscal policy; it is a reflection of expectations of future economic performance and of the interventions in monetary policy by the Bank of England.
Kelvin Hopkins
Is it not simply the case that bond markets can get things terribly wrong as well? We know of the 1929 crash and the 2008 crash, for example. I have no doubt that some have great optimism about the future of the world and national economies, but they can get it wrong, too.
Chris Leslie
That is why some in the bond markets in the City and even the IMF and other economic commentators and business leaders are increasingly saying—as PIMCO did today in its intervention on these issues—that we have to do something about this. Demand in the economy is cripplingly bad; we have to do something to take a different course. The Chancellor’s plan is not just failing; it is adding to our problems with the public finances. We will see the state of the deficit reduction plan and what is happening with this trajectory when we see the figures tomorrow. We hear of blaming the snow, blaming the royal wedding, blaming all sorts of other players including the European Union; it is amazing how we never hear that it is the fault of those who currently occupy the Treasury.
Greg Clark
I have a genuine question for the hon. Gentleman again. Was the shadow Chancellor wrong when he said:
“Long-term interests are the simplest measure of monetary and fiscal policy credibility”?
When he said that, interest rates were at 4.75%. Was he wrong?
Chris Leslie
The Minister can ask me the same question as many times as he likes, but I will give him exactly the same answer. There are a number of reflections and metrics for judging economic performance, but in these particularly stagnant economic circumstances, I do not think that he should wear as a badge of honour those ultra-low bond yields because they actually reflect low and depressed expectations about the future performance of the economy. He knows that that is true. It is also a reason why not just Moody’s but Fitch have taken out the legs from beneath the UK’s triple A credit rating after three years of stagnation, rising unemployment and billions more borrowing to pay for economic failure. It is time that the Treasury woke up and realised that its plan is causing long-term damage not just to the public finances, but to British families and businesses as they pay the price. When even their biggest allies—the IMF and the credit rating agencies—abandon the Government, it is time to put political pride aside and finally act to kick-start the economy.
Most independent forecasts suggest that on Thursday the GDP figures will show small positive growth, but growth of just 0.3% would simply mean that the economy was back to where it was six months ago. After three years of stagnation, we need to see decisive evidence this week that a strong and sustained recovery is finally under way—otherwise the Chancellor will definitely be in real trouble. We cannot seriously be expected to ratify this Budget Red Book as our representation to the European Union, or anyone else, of how our economy is performing.
Are we supposed to ignore the double downgrading of the UK’s credit rating, first by Moody’s and then by Fitch? Are we supposed to skim over the new figures from the Office for National Statistics, which show that the average weekly pay packet was £464 in February and £480 in the same month last year? That is the worst set of data since the ONS started recording such facts. Are we supposed to turn a blind eye to the fact that youth unemployment rose by more than 20,000 last month? The total figure is now just under 1 million. Should we just forget about the risks of that lost generation?
The Red Book is a staggering work of deception wrapped in the heroic conceit of a Government who are trying to fool people into thinking that they are on track. They are losing control of the public finances because they have lost the plot when it comes to the relationship between economic growth, jobs, the economy, and the revenues that we need in order to get the deficit down. It would be far simpler for the House to reject the motion and return the Government to the drawing board to get their act together and work on an alternative plan that might actually give us the bold action that we need, rather than the stagnation that we are suffering.
Mr William Cash (Stone) (Con)
This is an extremely important debate, but I am sorry to have to say that the Government did their best to prevent it from being held on the Floor of the House. Speaking as the Chairman of the European Scrutiny Committee, I feel that that must be put on the record. It was very unfortunate, to say the least, and no doubt the Committee will consider it when we meet next Wednesday.
Having said that, I must add that this is an opportunity to put in context the tributes that should be, and indeed have been, paid not just to Margaret Thatcher but to Alan Walters and all who took part in the Maastricht rebellion, and also to those who have fought so tenaciously throughout the accretion of these treaties, from the early days until the present time. I use that collective term because many new Members who are in the Chamber now—notably my hon. Friends the Members for Rochester and Strood (Mark Reckless), for Bury North (Mr Nuttall), for St Albans (Mrs Main), for North East Somerset (Jacob Rees-Mogg) and for Bedford (Richard Fuller)—are apprised of the seriousness of the situation, as indeed we were at that time.
Section 5 of the European Communities (Amendment) Act 1993 was passed 20 years ago as a result of a very tense debate about these questions. In the last 20 months, there have been at least 20 economic summits in an attempt to unravel the dysfunctional nature of the economic requirements with which we are having to comply, in the context of the convergence criteria and as set out in papers that have been placed before the House. I imagine that many Members have not had an opportunity to read those papers, but they have been placed in the Vote Office for the benefit of those who wish to do so.
While we are dealing with the consequences of the Maastricht treaty, I want to take the opportunity to put on record a correction to a book by the former Chief Whip in the House of Commons, Lord Renton. After making some fairly disobliging remarks about certain Members—I need not ignore the fact that I was one of those of whom he did not particularly approve—he wrote that
“the vehicle for their resistance was the parliamentary approval for the Treaty of Maastricht.”
He went on to observe, astonishingly,
“Although this had been signed by their heroine, Margaret Thatcher, they revelled in defying three-line whips in order to vote against its enactment into British law”.
That is complete and total arrant nonsense. Margaret Thatcher did not sign the Maastricht treaty, although she certainly became a patron of the Maastricht referendum campaign, which I organised along with Bryan Gould and a Liberal Democrat Member who represents one of the Devon seats. However, the present Prime Minister himself has now said that there should have been a referendum on that treaty, and I believe that, had there been one, we would have won. The father of my hon. Friend the Member for North East Somerset (Jacob Rees-Mogg) was one of the leading campaigners in the House of Lords for the referral of the treaty to a referendum, but his campaign was defeated by a monstrous whipping operation, with the result that we are where we are.
There was a complete refusal to listen to what was said at the time, and there has been a complete refusal to listen to what has been said ever since. I fear that the coalition is still not listening, although it is now clear as crystal that our predictions were right and that riots, massive unemployment, the rise of the far right and the failure of the system are destroying not only the European economy but Britain’s prospects for growth. I shall say more about growth in a moment, because it is fundamental to the issue that we are discussing.
Mark Reckless
As my hon. Friend pointed out, the Prime Minister now says that there should have been a referendum on the Maastricht treaty. Does he recall that the Prime Minister was at the time a special adviser to the then Chancellor of the Exchequer, who had been Chief Secretary to the Treasury under Margaret Thatcher and who refused to sign the treaty? A junior Minister, my right hon. Friend the Member for Horsham (Mr Maude), had to go and do it instead.
Madam Deputy Speaker (Dawn Primarolo)
Order. That really is not part of the subject of the debate. We are not having a history lesson on how we came to approve section 5, or on the players in that event; we are considering the documentation that the Government have asked us to approve this evening in connection with section 5, and I should be grateful if all Members would remain in order. I feel sure that Mr Cash is going to come to the point now, in the context of that documentation.
Mr Cash
The hon. Member for Stone—who is also Chairman of the European Scrutiny Committee—will of course do just that. I am grateful to you, Madam Deputy Speaker, for drawing my attention to these interesting documents. Among the interesting statements in the documents is this in paragraph 2.17:
“The euro area is the key market for UK exporters, accounting for 42 per cent of UK exports in 2011. As a consequence, the euro area sovereign debt crisis and subsequent recession have weighed heavily on the UK recovery. Action by European policy makers in 2012”—
I must say that I am astonished by the phrase that follows—
“helped ease the crisis and there are signs of investor confidence improving, but as the situation in Cyprus demonstrates the challenges facing the euro area are not fully resolved.”
Well, we can tell that to the people of Cyprus, but we can also say it to the people of Britain. This is not just a eurozone problem; it is a European Union problem, but above all else it is a British problem, and that is why we must take the necessary action.
The document is completely wrong to describe the euro area as “the key market”. In fact, as I pointed out in a paper that I wrote with my hon. Friend the Member for Harwich and North Essex (Mr Jenkin), the UK runs a trade deficit with the other 26 member states of £47 billion a year, yet we have a surplus of about £20 billion in our trade with the rest of the world. Furthermore, the Germans—about whom I shall say more in a moment, because of what was said by Angela Merkel at 3 pm today—run a surplus of no less than £29 billion a year with the other 26 member states.
That is why the debate is so important.
Jacob Rees-Mogg (North East Somerset) (Con)
On paragraph 2.17, does my hon. Friend share my view that it is a mistake to look at the euro area as one export market, as the individual countries that make up the eurozone have their own characteristics, and we naturally have a huge trade with Ireland, as all countries do with their nearest nation, irrespective of which currency bloc they belong to?
Mr Cash
Absolutely, and one of the greatest pleasures I have had in the past couple of years has been to have my hon. Friend serving on the European Scrutiny Committee, with the diligence, knowledge and judgment he brings to all these matters.
It is also stated, at paragraph 2.19, that
“Brazil, Russia, India and China taken together were the destination for 6.5 per cent of UK exports in 2011.”
The real problem here is that our exports certainly have to go to the BRIC countries and also to the rest of the Commonwealth, which is where the emerging markets are, as well as to the United States.
I strongly recommend that this House of Commons and this Government start waking up a bit. I really mean that, as I am very concerned indeed, as any right-minded person in this country should be.
It is also argued in this paper that:
“Between 2009 and 2012 UK goods exports to Brazil increased by 49 per cent, to Russia by 133 pre cent, to India by 59 per cent and to China by 96 per cent.”
I have heard those figures before, but I asked what our actual import penetration into China was in relation to that of the rest of the world. It is 2%. The 96% increase is entirely relative, therefore. The real question is how much we are managing to export into China. Germany exports into China 45% of all the EU exports into China. I do not cite that figure in order to denigrate the expert efficiency, determination and political will of those who run Germany, but I do say that we had better get our act together. Continuing to be locked into these absolutely penalising treaties is causing us enormous damage, when we could gain so much by trading not only with Europe, but with the rest of the world on a much more enhanced basis.
There is far too much discussion and not enough action, and I was glad to note the campaign launched today by 500 business men and run by Matthew Elliott, and I also commend the book about the euro by the Institute of Economic Affairs, which puts its finger on many of the problems in the euro area.
Richard Fuller (Bedford) (Con)
I am very interested in what my hon. Friend is saying. Does he agree that this report has given us an opportunity to put an alternative argument against the strong argument about commonality? I know he will draw the House’s attention to the interesting comments about Europe by the Chancellor of Germany today. My hon. Friend talks about those other economies, and there is an argument against commonality and for the UK having an opportunity to be able to trade with the rest of the world, but that is being lost as a result of such statements. Is there an opportunity for us to make this case, because I am not sure we are making it strongly enough?
Mr Cash
I agree with my hon. Friend. We must be realists. T. S. Eliot once said,
“human kind
Cannot bear very much reality”,
but Britain has got to wake up. It is crucial at this stage that we understand—in a constructive, not a negative, sense—that we have both a problem and an opportunity, but that opportunity will not last much longer, and we must not simply repeat the recitations and mantras about section 5 while not tackling the intrinsic problems.
These papers were, no doubt, prepared by worthy civil servants, but they may well not reflect the real situation. Let us look at the question of the level of debt, for instance. I mentioned that in an intervention on my right hon. Friend the Financial Secretary, and I gave him the percentage figures. However, under the previous Government—I now turn my attention to those on the Opposition Benches—I repeatedly said, along with my right hon. Friend the Member for Wokingham (Mr Redwood) and one or two other Members, that the debt that was accumulating under them was causing so much damage to our economy. Furthermore, as I said at the time of the last election in my manifesto—or, rather, in my personal message to my constituents—the stated debt levels, which is the key issue, were based on what could only be described as a lie.
Chris Leslie
What does the hon. Gentleman think about the fact that the national debt has risen by 38%—by over a third—in the past three years, while the current Front-Bench team has been in charge?
Mr Cash
Not only am I appalled by that, but I also recognise that the genesis of much of this can be traced back to the time of the previous Government. Furthermore, we now understand from the official figures published by the UK Statistics Authority that the level of debt—which at one time was, astonishingly, described as being “merely” £1 trillion—will go up to £1.5 trillion. However, under the previous Government the real level of debt—taking into account public pensions, Network Rail, nuclear decommissioning and several other factors, which we cannot ignore—was actually up at about £3.25 trillion, as I argued at the time, and if we include those factors it is now likely to be about £4 trillion.
That is the inheritance of the young people of this country. They have got to be brought into work as a result of growth, but the prescription from the Opposition Benches is more debt, not less, and more Europe, not less.
Regardless of how I vote this evening, I pay tribute to the fact that at least the coalition Government have begun to look at these questions. My complaint is that they have not done enough and they are going too slowly. If they do not get on with it, there will be a catastrophe. In fact, we are already living through the beginnings of a catastrophe.
There is another question to be asked about growth. We can only grow our economy by growing from the other countries with whom we trade. In a nutshell, we must engage in cuts, but we need the taxation from the growth of small and medium-sized businesses in order to provide the public services those on the Opposition Benches say we need to provide. All they do is call for ever more cuts, but they talk about growth but do not actually do anything about it.
The European approach of large, and greater, Government spending tends both to increase the rate of Government debt and to lower the GDP growth rate. As a result, growth in most European countries, and the possibility of getting Government debt under control, recedes. The rigidities imposed by a single currency—the euro—and the burden of EU regulation on EU economies are continuing to cause frictions and difficulties and will destroy the countries in the European monetary union.
If only people would listen at the time, when it matters, rather than afterwards and then try to cover things up. Only a few weeks ago, Moody’s downgraded our economic performance, and Fitch did so in the last couple of days. Portugal, Ireland, Greece, Spain, France and Italy are now all countries of perpetual economic concern. There is a black hole, but the call is for more and more Europe.
I referred to the remarks of Angela Merkel today. It is regrettable and unfortunate that she was quoted as saying that countries in the eurozone must accept that Europe “has the last word,” and need to work more closely together if the continent is to avoid going into decline. I am sorry to have to say this so specifically, but that is precisely because there is a centralised approach, which is driven by German requirements and goes back to Chancellor Kohl.
In the 1990s, I wrote a pamphlet called “British and German National Interest”, and we are seeing a repetition of that time. Chancellor Merkel said:
“We need to be prepared to break with the past in order to leap forward. I’m ready to do this.”
In fact, she is going back to the past—not the dark past we all witnessed so vividly, but the kind of past that assumes it is not actually a European Union, but in practice, a German Europe. We should ask people in Cyprus and Greece what the position is. She said:
“Germany will only act together with the others—hegemony is totally foreign to me.”
It may be foreign to what she wants, but the practical reality is that it is happening.
We are now being lectured by Madame Lagarde, who was a French economic Minister and is now head of the International Monetary Fund. She said:
“We violated all the rules because we wanted to close ranks and really rescue the euro zone.”
Those are the rules we are discussing. On top of the theft in Cyprus, everyone knows that those of us who argued the case have been proved right.
I am sorry to hear that Madame Lagarde appears to have criticised our Chancellor. It is some gratitude for all the work he did urging her to accept the presidency of the IMF, and leading the charge to make sure she got it.
Everyone wrings their hands, but what are the Government doing? We are being locked into the question of whether the debt is being sufficiently reduced, but the debt is escalating and the deficit remains unacceptably high. Problems in the eurozone have a real effect on the UK economy. I repeat that it is not just about the eurozone, or just about the European Union; it is about Britain, which is why we have to get our act together. I notice that the Chief Whip has just come into the Chamber, so I hope he will listen with care, because these debates will unravel.
Real GDP fell in every quarter of 2012 in the eurozone, and by 0.6% over the year as a whole. The IMF forecasts a further fall of 0.3% this year. What is happening is completely unacceptable. No wonder the UK Independence party is making such headway; it will continue to do so until there is real growth.
We have the opportunity. We can deliver. No doubt the commentariat will fail to report this debate, as it fails to report other debates when we deal with facts and not mere speculation, but that will not prevent us from continuing the fight. We have the means to achieve the results. Some of them will come from a change of position by the Government, going for more and more growth based on real policies for growth and disentangling ourselves from the shackles of the regulatory arrangements of the European Union, making sure that the EU does not dominate the free trade agreements that are being determined. We have to be able to trade on our own terms, just as we in this Westminster Parliament have to decide the future of British policy.
As the Prime Minister said in his five Bloomberg principles, our national democracy depends on our national Parliaments. European democracy depends on their national Parliaments. He was right about that. Let us do something about it. Let us make sure that we run our own economy based on our own assessment and that we do not remain shackled to the existing treaties. It is time to put an end to them.
Kelvin Hopkins (Luton North) (Lab)
I rise to speak briefly in support of my hon. Friend the Member for Nottingham East (Chris Leslie) about the nonsense of presenting the fiction of the Red Book as though it represented the truth about our country. Another organisation—perhaps the Institute for Fiscal Studies—would do a better job.
Last week, in a speech in the Chamber, I reminded colleagues of an organisation that used to get forecasts right: the Cambridge Economic Policy group. But it was a left-leaning Keynesian group and the Conservative Government of the time withdrew its funding, because they did not like its answers and chose to follow the London Business School, which always got the forecasts wrong. The Sunday Times always gave it nought out of 10. Let us not pretend that all forecasts speak the truth. Officials will never present the Chancellor with a gloomy picture; they try to put as big a gloss on things as possible so that the Chancellor can say nice things to us in the Budget speech.
I only wish that the colour of the Red Book represented some of the policies inside, but I am afraid it does not. The antiquated language is nonsense. The Minister drew our attention to the fact that the reference to convergence was born of the past assumption that all countries would be in a single currency, we would all be growing nicely together, and poorer countries would become rich countries. That has all been washed away; it is all complete nonsense. It seems the only convergence we seek now is with an area that might be in terminal decline—the European Union. It is in serious economic difficulty, so do we want to converge with it? I suggest we want to diverge from it and make our economy work.
Although there are areas where we would have definite disagreements, the hon. Member for Stone (Mr Cash) often says things I agree with. He said we were talking about a German European Union. In 1989, the Institute for Public Policy Research published a document called “The German Surplus,” which was quickly suppressed because it was too explosive. The whole political establishment was moving towards a pro-euro, “Let’s join the single currency and the exchange rate mechanism at the wrong time” approach. I still have a copy of the document and I think it can still be found on the internet. It said that Germany had built an economy around itself, such that it could sustain low parity for its currency against all the others. Building that low parity for their currency into the euro meant that the Germans would always have a competitive edge over the other countries and could export to them freely. What they did not appreciate was that over time those countries would run out of money and Germany would have to lend them money to buy German products, which is what has been happening. Germany either has to dissolve the whole arrangement or carry on giving vast sums of money to other members of the eurozone to help them buy German goods.
Kelvin Hopkins
I shall certainly look it up.
Ministers go on and on about the importance of exports to the rest of the European Union—our Ministers did too—but they rarely talk about imports. We have a gigantic trade deficit, which is getting worse and worse every year. Even between January and February, the goods deficit with the EU rose from £4.8 billion to £5.1 billion. It now looks as though the trade deficit this year may be £60 billion. That is enormous; it is more than £1 billion a week. We are buying £1 billion more goods from the EU every week than the EU buys from us. That is not a sensible way to run an economy.
Mr Nuttall
Does that statistic not put the lie to all the people who claim that 3 million jobs would be lost if we left the EU?
Kelvin Hopkins
Indeed. If we just maintained balance, we would gain a million jobs overnight. If we go back to the Bretton Woods arrangements following 1944, Keynes was concerned about trade imbalances and he wanted arrangements to be put in place across the world that would avoid big deficits and big surpluses. Also, he wanted to require those with big surpluses to appreciate their currencies, as Germany should have done a long time ago. We are just going through the motions of arrangements made years ago which no longer have any serious meaning.
Germany is now in trouble. It has faced a savage reduction of 17% in car production in the space of one month. It is in difficulty and will have to look to itself to solve that problem. George Soros has suggested that one of the ways out of all the present problems is for Germany to leave the euro and to recreate the deutschmark, which would naturally appreciate. All the countries now tied into the euro would then have difficulty. Denmark, for example, would want to devalue straight afterwards. Others are now talking about what George Soros said. There are people in Germany who want to leave the euro.
There was an extremely interesting article in The Guardian this morning, suggesting that the only way out of this is for all the countries of the European Union to recreate their own currencies and to find appropriate parities for those currencies. If a country has its own currency, it can borrow and it can print money. It may be forced into a devaluation but it manages its own economy nationally and it can adjust the shock absorbers of separate currency, which are vital. The example used is Japan, which has had serious problems but is managing its economy internally.
I draw Members’ attention to the one country that has come out of the current crisis rather better than all the others—that is, America. It is surprising, but American growth is at 2%, whereas ours is well below 1%. Although America still has serious difficulties and serious unemployment, it is doing better than Europe because it is pursuing growth policies, which necessarily mean more borrowing.
I know that hon. Members on the Government Benches are horrified at the thought of more borrowing, but I urge them to read the great book by John Kenneth Galbraith, “The World Economy since the Wars”, where he pointed out that during wars—classically, the second world war—America borrowed vast sums from its own citizens. They finished up with lots of war bonds which they cashed in, and the American economy started off as the strongest economy in the world, stronger than it has ever been because of the massive investment in manufacturing that took place during the war. Its debt was based on borrowing, which was paid back over time, as the American economy grew, with full employment.
I could go on, but I will not. Debating the motion every year is a nonsense. We ought to be looking at more sensible ways of running our economies.
Jacob Rees-Mogg (North East Somerset) (Con)
May I begin by saying how pleased I am that this debate has come to the Floor of the House and commend my right hon. Friend the Leader of the House for bringing it here? He was unduly modest to send it upstairs to Committee because this gives us an opportunity to highlight the Government’s achievement and send it to Brussels with a panache that says, “We know what we are doing and we are pleased to educate you.” Unlike the hon. Member for Nottingham East (Chris Leslie), who I think has been confused in his economics this evening, the document shows how well we are doing, compared to our continental colleagues.
Before I adumbrate our great achievements and the success of this Government since 2010 as set out in the document before us, there is one little matter that I wish to raise about the surveillance mission that the European Union is entitled under a 2011 agreement to send into a country that is not meeting the convergence criteria. Although it cannot punish us for failing to meet the convergence criteria, the European Union can, I believe, send in a surveillance mission or even a rather ominous-sounding enhanced surveillance mission.
I hope the Government will be clear, and I thought from what my right hon. Friend the Minister was saying that the Government are being clear, that they will not accept such surveillance and will use all their abilities to discourage the European Commission from sending any surveillance mission. It would be a great audacity—a great cheek—if it were to do so when 19 member states are in special measures for their economic failings for the excessive deficit procedure. We, of course, are in it too because of our deficit, but those 19 other members are in the eurozone, which is why bringing their budgets together is so important, whereas for us it is essentially a technicality from the Maastricht treaty.
It is a matter of importance that the Government have got the policy right. The key to getting it right is found on page 31 of the documentation and then on page 15. Page 31 deals with the quality of the public finances. It deals with what the Government are doing to consolidate our situation and the projection. Projections should be treated with the greatest suspicion. All forecasts are wrong, and it is merely a question of how wrong they will turn out to be. None the less—
Jacob Rees-Mogg
That was a wonderful interjection, as always, from the hon. Member for Ealing North (Stephen Pound). I fear not. It is a statement based on a knowledge of history that forecasts invariably turn out to be inaccurate and it is merely a question of how inaccurate they turn out to be.
But if we look at what the Government are trying to do, they are getting spending down from 47.4% of GDP to about 40% of GDP. We know from our history that about 40% of GDP is a sustainable level of Government spending. It is a level that I personally would like to see reduced further, but it is none the less a level that has been consistently affordable over the long run, certainly going back to the early 1970s, based on taxation revenues going up to 38.3% of GDP. Now, 38.3% of GDP for tax revenues is very near the peak level that has ever been achieved. It is rare for tax revenues to go above 38% of GDP or to remain there for a sustained period.
So what is being done with the public finances is an extraordinarily effective consolidation on both sides, with taxes being pushed up and expenditure being cut, with most of the burden being taken by expenditure cutting and with a small amount of it on tax raising. That is setting the basis for a long-term recovery of the economy. Where I think the hon. Member for Nottingham East was perhaps unduly party political in what he said—uncharacteristically so, because he is normally a man of such consensus, support for the middle way and so on—was in ignoring the benefits of monetary activism.
I refer right hon. and hon. Members to page 15. The key difference between the UK economy and the continental economies is that we have the ability to change our monetary policy to ease the austerity—[Interruption.] Indeed, printing money. Absolutely right. It is the printing of money that is allowing the deficit to be sustainable and is allowing businesses and individuals to carry on borrowing and work through a consolidation of their finances, which is also in the document—the consolidation of individual finances—to take place in a way that is not crippling. On the continent that is not happening, which is shown up in the gilt yield figures. The latest gilt yield figure is 1.65%. That is the lowest in our history. In Italy it is at 4.05% and in Spain just under 4.5%, which shows the much tighter monetary situation in Spain and Italy as compared with the United Kingdom. That is why the austerity programmes in those countries are causing such extraordinary pain, whereas in this country it is manageable.
That is why I say the document is a model for our friends and neighbours across the channel. We ought to send it to them with a fanfare, with trumpeters, with Garter King of Arms leading the way, to say to them, “Look, this is how you do it. This is how you restore a country to fiscal sense, and you do it through monetary easing.” Although I loathe the fact that we have to report to a multinational body about matters that are our own sovereign right and should not be interfered with from abroad, on this occasion we can take real pride in what the Government are achieving and what they are working towards and the manner in which they are doing it.
Mr David Nuttall (Bury North) (Con)
It is, as always, a great pleasure to follow my hon. Friend the Member for North East Somerset (Jacob Rees-Mogg), if, as always, somewhat of a challenge to match his oratory. If, as will no doubt be the case after tonight’s proceedings, the Government eventually send this tome to the bureaucrats in Brussels, it would be sensible and appropriate for them to append to it a copy of my hon. Friend’s speech, which succinctly set out the Government’s achievements in managing so sensibly the British economy since they took office in 2010.
This evening, in the few minutes that remain for the debate, I want briefly to set out why I oppose, as so many have, this annual charade of going through the process of submitting a document entitled “Convergence Programme for the United Kingdom”. As always, the question is: what on earth are we converging with? Why would this country want to converge in any way, shape or form with the other countries of the European Union, when our growth, as judged by the EU’s own statistical body, EUROSTAT, is forecast to be 0.9%, the EU average to be 0.1% and the eurozone to be minus 0.3%? It is forecast not to grow at all. Why on earth would we want to try to converge with it? What is the point of submitting this convergence report every year?
I do wonder whether we ever get any feedback. Every year, the eurozone stumbles from crisis to crisis. It does not appear to take any notice of this document in which, since 2010 when the Government took over the nation’s finances, we have set out for the benefit of our European partners the way in which we manage our affairs in this country. We may have our political differences in this Chamber as to the right way forward for our economy, but those arguments are solely for this Chamber and for the other place, for this Parliament, to determine. We should in no way be beholden to the Brussels bureaucrats when it comes to British finances.
The Minister referred to the convergence programme document, saying that no time was spent in producing it. Nevertheless, there is a document. Someone has spent some time putting together this weighty tome, which this year runs to some 235 pages. It is a bespoke document, submitted in accordance with the European treaties. This evening, time does not permit us to go through the long process of how we got to the state that we are in today, but the question remains as to why we go through this annual charade. Surely it would be much better if, as I have said in previous years, we simply said to the bureaucrats in Brussels, “Look, if you are that interested in finding out what we in the UK are doing, just log on to the internet and have a look at all the documents on the Treasury’s website. You will see the Budget statement and the Red Book. That is what we are doing, and if you want to comment on it, go ahead and do so. But why on earth should we waste our time and money in submitting this convergence document to you?
What really matters is not what the Brussels bureaucrats think, but what the British people think. At the next general election, the British people will have a crucial choice to make. Should they vote for the party that has led this country through the most difficult of times and put it back on the road to recovery, taking very difficult decisions that may well have adversely affected them? They will know in their heart of hearts that the decisions were right; they were right for the British economy and ultimately they will be right for them and their families. Should they vote for the party that has put us on the road to recovery or for the party that got us into this mess in the first place? That is the crucial decision that really matters at the next election. It does not matter what the Brussels bureaucrats think about the running of the British economy.
I oppose the motion not because I oppose the Government’s economic programme, but because I oppose the idea that we should in any way be beholden to Brussels. We should not be spending our time submitting this document or any others for its consideration.
Question put.
Business without Debate
Business of the House
(11 years ago)
Commons ChamberRead Full debate Read Hansard Text Read Debate Ministerial Extracts
The Leader of the House of Commons (Mr Andrew Lansley)
I beg to move,
That at the sittings on Tuesday 23 and Wednesday 24 April paragraph (2) of Standing Order No. 31 (Questions on amendments) shall apply to the Motion in the name of Mr Edward Miliband as if the day were an Opposition Day; proceedings on the Motion may continue, though opposed, for three hours and shall then lapse if not previously disposed of; and Standing Order No. 41A (Deferred divisions) shall not apply.
I shall not detain the House for long. I simply want to draw attention to the fact that, as I announced at last Thursday’s business questions, tomorrow and Wednesday will be Opposition unallotted half days. The debates are guaranteed to last three hours and will be treated as Opposition days, notwithstanding what might happen with regard to the consideration of Lords amendments.
Question put and agreed to.
Business without Debate
Fixed-odds Betting Terminals
Tom Greatrex (Rutherglen and Hamilton West) (Lab/Co-op)
I am pleased to have secured this debate. I know from the number of letters, e-mails and, indeed, tweets I have received in the past few days that there is concern about the prevalence of fixed-odds betting terminals—or FOBTs, as they are commonly known—primarily in high street betting shops. A number of hon. and right hon. Members, some of whom are present, have also expressed concerns. Given that we have more time available than anticipated they will be able to make contributions, or if they want to intervene I will seek to accommodate them.
I will begin by clarifying my own position on gambling. Participants in debates such as this are often portrayed as being either pro or anti-gambling. I am not anti-gambling, nor do I seek to persuade the Minister of State to prevent people from being able to gamble in betting shops if they so choose. There are 32 such shops in my constituency—they exist across the whole country—and I received a briefing earlier today that informed me that they employ 152 people. Many people gamble for entertainment and in their own time—some occasionally, some regularly—on sport, in the casino, at bingo and in other forms, and they do so without any problems. Indeed, most years I place a bet on Fulham winning the FA cup. That one has not come in yet, and my annual visit to the bookmakers seems to be as much for their amusement as for mine. [Interruption.] My hon. Friend the Member for Ealing North (Stephen Pound), a fellow Fulham supporter, reminds me that in 1975 we came quite close. I was about eight months old at the time, so I do not really remember it, but I am sure that he had a bet that day.
The serious point is that my inclination and that of many Members of this House is to be very cautious about regulating how people choose legally to spend their money. That should be a matter for them and in most cases it is. There is also a danger in seeking to extrapolate policy from the worst cases of problem gambling. That does not mean, however, that the Government should simply ignore the issues and concerns that arise from the fact that between 2007 and last year, the number of FOBTs on high streets throughout Britain near enough doubled from 16,380 to some 32,000.
My interest in this issue began late in 2011, when I was approached by a constituent who in one month had gambled more than £25,000 on a single machine in a betting shop in my constituency. He approached me not because he had accepted that he had a gambling problem caused by the use of the roulette game that he played, but because he was convinced that that game was rigged. At that point, he had not thought that he had a problem. I am pleased to say that he has now accepted that he has a problem and is involved in a number of groups to deal with it. A feeling that the game is rigged is often the first indication that somebody has a problem that is getting out of control.
When my constituent approached me, I was astonished that somebody who was not a bored millionaire professional footballer betting on the horses or a property tycoon at the casino could lose that amount of money in such a short space of time at the local betting shop during the day on a single machine. What I had not appreciated is that we are not talking about machines with a £1 or £2 spin like the fruit machines in a pub, on a ferry or in a chip shop. B2 machines, as they are known, are casino-content terminals with high stakes, fast play and randomly generated results. The maximum stake is £100 per spin. It is possible, therefore, to stake £300 in a minute. In the extreme, that means that it is possible to stake up to £18,000 in an hour.
Ian Lavery (Wansbeck) (Lab)
The anti-gambling lobby says consistently that gamblers can lose up to £18,000 per hour on these machines. Will my hon. Friend comment on the likelihood of that?
Tom Greatrex
My hon. Friend anticipates my next point. Even if somebody played at the maximum speed for an hour, it would be highly unlikely that they would lose every single time. I suspect that the odds of losing £18,000 in an hour are pretty long. However, this is not just an idle way to use up some spare change, with the anticipation of winning a few pounds. Many people who use these machines lose a significant amount of money in a relatively short period.
I am sure that many Members have received cards via betting shops from the “Back your local bookie” campaign, which has made points about the economic value that bookmakers contribute. Betting shops often invite Members to go along and have a go on one of these machines. They will put it in demo mode and one can press a button and see that it is all very straightforward and fine. However, I have chosen to be an unannounced visitor to betting shops in London and in my constituency. What I have seen is quite alarming. People sit on the machines for a prolonged period, playing continuously and obviously staking significant amounts of money. Other than on weekends such as the grand national weekend or the Scottish grand national weekend, there is next to nobody betting over the counter. Many shops are staffed by a single individual. Other than overseeing the premises, it appears that there is relatively little for that individual to do. The machines do the work, take a lot of the money and, as the published figures demonstrate, deliver half the profit of high street betting shop chains.
I also recently spent a morning with the Hamilton Gamblers Anonymous group, who by definition are people with a gambling problem. I would not seek to suggest that everybody who gambles from time to time, or even a significant proportion of them, develop a problem, but from meeting that group, it struck me that there was a clear divide between the younger and older members. Many of the older members had developed a problem associated with gambling on horses or sometimes dog racing, or in casinos or on cards. All the younger members of the group had bet significant amounts of money on betting shop machines. Either that had been their way into gambling, from which they had developed a problem, or they had moved on to it from other forms of gambling in betting shops. I am sure that we have all heard stories about the impact on homes, families and children, with relationships breaking down because of a compulsive habit that people can indulge every day from 8 o’clock in the morning in the betting shop around the corner.
Ian Lavery
Is there not a bigger problem for individuals who have problems with gambling, in that they can sit at home gambling online 24 hours a day, often with bigger stakes than £100 every time? I wonder why the anti-gambling lobby and a lot of people do not focus on that potential problem rather than on what is happening in betting shops.
Tom Greatrex
My hon. Friend makes an important point, and I would not describe myself as anti-gambling. Some industry representatives seem to take quite an arrogant and dismissive attitude to concerns that are expressed, but I would not call myself anti-gambling. He is right that people can gamble significant amounts on the internet in their own homes, but we cannot take comfort from the fact that significant amounts can be gambled on machines on the high street in a short period.
Mr David Hamilton (Midlothian) (Lab)
Does my hon. Friend agree that at least a betting office pays taxation and can deal with problems and give advice in-house, whereas gambling on computers is a whole new direction, with a lot of young people involved? No money comes back to the country, because it all goes offshore. Surely the betting offices’ argument is that they are having to do this because of the offshore betting that takes place elsewhere.
Tom Greatrex
My hon. Friend is absolutely right about where the profits of a lot of internet gambling go, but I would have more sympathy with his argument about high street betting shops if I could be more confident about the supposed self-regulation for people who have a problem. People have to sign themselves in and suggest that they have a problem, which misses out many people who have not yet accepted that they have a problem. That is related to a point that I will make later about the clustering of betting shops in particular parts of high streets, which suggests that the idea is to maximise the number of machines in close proximity so that people go from one to another. It is hard for betting shops and the big chains to deal with problem gambling as they encounter it when so much activity is automated; it is much harder than in the case of traditional, over-the-counter gambling.
Tracey Crouch (Chatham and Aylesford) (Con)
I congratulate the hon. Gentleman on securing this debate on an issue that is incredibly important in the Medway towns and Chatham, where we have seen a proliferation of bookmakers on the high street.
It is wrong that people who raise concerns about fixed-odds betting terminals are considered part of the anti-gambling lobby. Surely it is our duty and responsibility as constituency MPs to look after the most vulnerable people in our constituencies, some of whom are drawn into gambling addiction because of the number of FOBTs in each betting shop.
Tom Greatrex
I thank the hon. Lady, who makes her point well. It is easy to dismiss concerns as coming from people who are anti-gambling or who want to abolish it. I understand that that is not her position, and it is certainly not mine. She is absolutely right to highlight the fact that there has been clustering of an increasing number of betting shops in certain communities. I have evidence of that in my constituency, and there is a danger of people being drawn in. That is why I think it is the Government’s responsibility to monitor the situation closely. As the hon. Lady said, the impact on some people should be of concern to any individual constituency MP.
Robert Flello (Stoke-on-Trent South) (Lab)
I am taking great notice of what my hon. Friend is saying as it is important not to characterise this debate as being either for or against gambling; it is not as simple or straightforward as that. May I put the record straight and say that not all online gambling is offshore? Indeed, the excellent bet365 in the adjacent constituency to mine is most determinedly remaining onshore in the face of competition—
Robert Flello
Indeed, as my hon. Friend says from a sedentary position, the chairman of Stoke City is also the chairman of bet365. As well as putting that important point on the record, may I stress that other aspects in life are regulated, such as drinking? We are not for or against drinking just because we raise a concern about alcohol, but we are rightly expressing a point. It is important that my hon. Friend the Member for Rutherglen and Hamilton West (Tom Greatrex) has initiated this debate, and I look forward to listening to more of his speech.
Tom Greatrex
I thank my hon. Friend for his intervention. He is right to make that point about bet365 and the chairman of Stoke City, although I am not sure what odds he would have put on Stoke winning at the weekend and seemingly escaping relegation for another year, and near enough relegating Queens Park Rangers in the process, which I am not necessarily hugely unhappy about—I digress, Mr Deputy Speaker.
My hon. Friend is right to make a point about how this issue is sometimes characterised and how things are regulated. As I said earlier, my inclination is that we should not try to over-regulate individual behaviour. Where harm is caused, however, the Government need to take the issue seriously. The right level of regulation is always a balance that the Government need to strike on the basis of evidence, and I will come on to that. That, however, is a different position from a blanket opposition to gambling, and I am grateful to my hon. Friend for intervening and allowing me to reiterate that point.
I was referring to the younger members of the Gamblers Anonymous group whom I met, and my concern has developed from those individual accounts. In recent weeks I have met those campaigning against a proliferation of these machines—people from a range of different organisations, both locally and nationally, who are concerned about their potential impact—as well as representatives from high street bookmakers. I have spoken to my own local authority, South Lanarkshire council, and received briefings from a range of organisations, including the Association of British Bookmakers. I believe the Government should be concerned about some of the issues that arose from those discussions.
As the Minister will be aware, and as I said earlier, it takes 20 seconds to complete a spin, and for each spin the maximum stake is £100.
Mr Andy Slaughter (Hammersmith) (Lab)
I congratulate my hon. Friend on securing this debate. He has already made this point but I think it deserves repeating. The £100 spin—50 times the normal limit—is an anomaly that allows people, very easily and conveniently, to walk off the high street and into a betting shop and gamble large sums of money. I popped into my local Ladbrokes last Friday evening to put an unwise bet on a dog at Romford—a tip given to me by the former Member for Hammersmith and Fulham—so I am not anti-gambling. The only four people in that betting shop were those playing on fixed-odds betting terminals. That is not what I expect a betting shop to be.
Tom Greatrex
My hon. Friend makes an important point. I, too, would be reticent about taking too much advice from a former Member for Hammersmith and Fulham in relation to sport.
Tom Greatrex
Since the former Member for Hammersmith and Fulham is an Arsenal fan, that is right. The experience of my hon. Friend the Member for Hammersmith (Mr Slaughter) in visiting betting shops mirrors mine in terms of where people are and what they are doing. It is the same at different times of the day.
On the limit, I am sure that the Minister will refer to the consultation, which recently closed. A range of organisations made submissions. The ABB briefing makes the case for the economic impact of changing the stake, but there is a social and economic impact in favour of such a change. I hope the Minister considers that carefully along with other representations. My hon. Friend was right to describe the stake as an anomaly. The machines are different from the fruit machines that we find in pubs, clubs and other places, and different from other gaming machines. I am not suggesting that everybody would stake that amount of money each time, but people can do so. They might have access to that amount of money for only a short period and it could be better used in other ways. If people have developed or are in the process of developing a problem, they might well stake that amount. I do not claim that every single machine user will bet £100 a go or £300 a minute. As I said in response to my hon. Friend the Member for Wansbeck (Ian Lavery), I suspect that people doing so would win as well as lose. Suggesting that someone could lose £18,000 in an hour is extreme—it is possible but highly unlikely.
I am concerned both by what I have seen and by the research that I asked my member of staff to carry out ahead of the debate. It is very easy to gamble a lot of money very quickly. People almost do not realise the amount they are gambling and the speed with which they are doing it. The nature of the machines is that they encourage people both to chase their losses and to try to increase their wins. It is impossible to deny that people can play roulette on an FOBT in the bookies at four and half times the speed they can play roulette in a casino. The ability to get hooked, even for a short period, is apparent. That is the experience of those I have met who have gambled on FOBTs, partly because they are perceived by punters to be a good bet. Why would people not believe that? The machines tell people that there is a 97% payback, which is not that far from 100%. People therefore believe they have a good chance of winning. Why would they play a £70 jackpot machine in the pub when they can nip next door to the bookies and play for a £500 jackpot on a machine that they believe has 97% payout?
However, people only believe that there is a 97% payback. I asked representatives of one of the large bookmakers how those figures were calculated. They told me that the 97% payback is not what an individual will win, and that it is unlikely that someone playing for 10 minutes or half an hour will win at that rate. The 97% is an average taken from the cash inputted into all machines against the return as a whole. That confusion could be addressed relatively easily. Will the Minister therefore press representatives of the gambling industry to use a more appropriate and straightforward figure? The Gambling Act 2005 states that gambling should be “fair and open”. Surely explaining the chances of winning in a much clearer way, and in a way that is much less likely to be misunderstood, is the least we can expect.
Another aspect of the debate—this has been mentioned in interventions—is high streets. Those of us who live close to high streets and main streets throughout the UK have seen a number of betting shops opening in recent years. The most recent ABB briefing to MPs and its press release boast of the number of shops in the high street and their employment impact. A cluster of betting shops in one street or one part of a street has become a common sight. Sometimes, branches of the same firm are in very close proximity. My right hon. Friend the Member for Tottenham (Mr Lammy) has highlighted that previously. The Government’s review of the high street—the Portas review—drew attention to that point with a proposal for betting shops to be put in a distinct category. As I am sure many hon. Members are aware, betting shops are currently in the same bracket as banks and building societies, and there is no need to apply for change of use through the planning processes.
Many retail businesses, including estate agents and coffee shops, cluster together, and retailers will always seek to locate where they believe there is a market—supermarkets are notoriously focused on, and efficient at, doing so—so why is there a problem with betting shops?
The Minister is of course aware of the increase in the number of these machines in the past five years. As I have said, there are almost twice as many as there were just five years ago. I am sure he also knows that half the profits of high street bookmakers come from the machines and that there is a limit of four machines per betting shop. It is increasingly apparent that the opening of new betting shops is driven by the ability to have more machines. From the figures available, it is also apparent that clustering tends to occur in places with more social deprivation and lower overall incomes.
I do not believe that the Government should seek to determine on a national level whether there is over-provision of businesses in a particular area, but it should be open to local authorities and licensing authorities to do so. The case being pursued by Newham council is indicative not just of a community that feels it has enough betting shops and machines already, but of a wider frustration that all too often local authorities feel there is very little they can do to address their concern. I do not expect the Minister to comment in detail on that case as it is in the process of going through the courts, but does he think that it should be possible for local councils and licensing boards to have the flexibility to determine whether there is a need for further betting shops in particular communities and how many machines should be available in each betting shop?
The thrust of the campaign postcards we have been receiving in recent weeks is that machines make a contribution to the economy, keeping betting shops going and employing people in constituencies across the UK. The economic impact of betting shops is important, but it needs to be assessed in the context of the total impact on local economies. As the Minister may be aware, a recent study by Landman Economics found that the £1 billion in FOBT spend supports 7,000 jobs in the gambling sector, compared to 20,000 jobs if that expenditure were used elsewhere. Put another way, there could be 13,000 fewer jobs for every £1 billion spent through the machines. Money being used to gamble in local high streets may be good for the big chains and their overall profit margins, but the local impact can be less beneficial. More and more betting shops are employing fewer staff, as gambling through machines has less need for personal interaction.
The gambling industry groups are robust and sometimes dismissive in their response to those concerns. Their perspective can be summarised thus: something being popular means that it does not cause problems; look at all the people employed in betting shops and the shops’ contribution to the local economy; and everybody knows exactly what they are doing because lots of them have A-levels. That type of attitude highlights precisely why the Government should keep the impact of the machines under review and not leave the industry to act under its own initiative.
While the industry argues that there is no evidence to suggest that FOBTs are addictive, anecdotal evidence suggests that there is a problem. The confusion in the Government’s own statements is apparent. In the consultation document I referred to earlier, they say that the causal link “remains poorly understood”. However, they also say that the association between high stake, high price machines and gambling-related harm is widely accepted, which makes the decision to end the gambling prevalence study all the more concerning. Will the Minister respond, in particular, to the point that research is required to determine the evidence on the likelihood of problem gambling? I am conscious that the people I have spoken to in my constituency are those with problems and that there are many who do not have problems, but the level of concern suggests that much closer attention should be paid.
Robert Flello
My hon. Friend seems to be concluding his remarks and I want to ask this question before he does so. On the impact of gambling addiction on communities, the cost to the Government of families where there is an addicted gambler spending money that should be spent on the children is huge. The cost to the nation of such addiction is massive. Does my hon. Friend agree that it would be in the Government’s best interests to have the best possible analysis of the impact of machines on addiction rates, so that it could guide their policies and ultimately, perhaps, even save some money?
Tom Greatrex
My hon. Friend makes an important point about how we assess the cost to the public purse and the impact on communities. It is an argument often used in relation to other policy areas, such as early-years intervention and so on, that can save money. I hope therefore that the Minister will comment on the level of evidence required, and how wide-ranging it needs to be, in order to assess the scope of the problem and how it could best be addressed.
There is some evidence on the proportion of gambling that is problem gambling. I think the Minister will be aware of the Birmingham university study based on analysis of the 2010 British gambling prevalence survey. It is a valuable piece of work that starts to consider some of these issues, but it needs to be constantly monitored and updated. In 2007, when the Department for Culture, Media and Sport commissioned a scoping study on the impact of the Gambling Act 2005, it recommended that FOBTs be closely monitored because they contained features closely associated with problem gambling. Will he explain what his Department has done, and will be doing, to monitor their impact?
Mr David Hamilton
I am following this debate intensely. I am not a gambler, but constituents have indicated to me the problems specifically with these machines. Is my hon. Friend saying that we should revert to how things used to be and that these machines should not be in the bookies? If so, there would be fewer bookies, because, as he said, 40% of their profits come from the machines. But how would that address the computer issue, which I believe is a big problem? There is no regulation there at all. If we want to resolve the problem, we have to address the computer issue, as well as the machines. If we removed the machines, it would reduce profits by 40% and it might also prevent the clustering he is talking about.
Tom Greatrex
My hon. Friend makes a point about the number of betting shops. He will be aware of the relatively recent increase in the number of betting shops in certain areas, which I contend is due, at least in part, to the ability to have more machines. The benefit of that is to the betting shops and chains—they are nearly all chains, and in some cases there is more than one branch of the same chain, but there will certainly tend to be one of each in close proximity. An assessment of their economic impact and their benefit to the local community, including from the jobs they provide, must be set against the negative impact of the problem gambling associated with the machines.
That does not take away from my hon. Friend’s point about internet gambling, which needs to be looked at again, but I think that collecting evidence on the extent of the problem and then giving more flexibility to local authorities and licensing authorities is a better way of establishing what is tolerable in particular areas. Otherwise, we get the clustering in particular areas where the problems tend to occur.
Mr David Hamilton
I thank my hon. Friend for that clarification, but I want to return to the main point. He started with the point that these new machines, which have been put in over time, are attracting people in off the streets and allowing them to make massive bets that they could not make before. If we took out the machines, or reverted to what is acceptable in clubs, pubs or other gambling establishments, where much less money can be spent, the logical outcome would be fewer betting shops. These are not betting shops as we know them, with betting on horse racing and football, if, as he says, people are going in to use the machines. If we eliminated the machines and reverted to what used to be the case, would we not reduce the number of betting shops?
Tom Greatrex
Certainly, most activity in betting shops takes place on the machines, rather than on over-the-counter betting, and that seems to have led to a change in the number of people being employed. Not in all chains, but certainly in some, there used always to be at least two people, with people betting at the counter, but now there is often only one person. So these machines might already have had an impact on jobs. We need to look at the issue carefully, because these machines have a significant impact. That is not good for any community, no matter how many betting shops there are there, nor does the number in a particular area necessarily justify a high prevalence of machines or the high stakes that can be gambled each time.
Before I conclude—I am conscious that I have gone on much longer than would normally be allowed in such a debate—
Tom Greatrex
I do not want to alarm other hon. Members, but I do not intend to speak for 55 minutes more, although the Minister may wish to do so.
I want to ask the Minister a couple of further questions about the vital research that, as I have said, needs to be done. I am sure he will refer to the research into all category B machines commissioned by the Responsible Gambling Trust and the time scale for that research. Obviously, he will look at it once it is completed—I think it is due to take 18 months, which is a considerable time—but I wonder whether he is aware of the concerns that have been expressed that the chair of the Responsible Gambling Trust is also the chair of the Association of British Bookmakers, which is the trade association that represents the industry. What reassurances has the Minister sought to ensure that the research that the Responsible Gambling Trust is undertaking is credible and that there is not a conflict of interest in the way it is undertaken? Is he also aware that the vice-chair of the Association of British Bookmakers is on the Responsible Gambling Strategy Board’s machines expert panel or that a special partner in a company that owns an FOBT supplier is also a member of the board? If so, does the Minister believe that that undermines the credibility of the research? What reassurance can he give that it will not and that the research commissioned by the Responsible Gambling Trust will be comprehensive and robust?
I make those points not because I wish to denigrate the reputation of any individual, but because the outcome of that research will be vital, as will be the research needed to understand the extent of the problem. This evening I have outlined anecdotal examples from my constituency, and I am sure many hon. Members present could do the same—indeed, some have done so in interventions on me. When the industry claims that there is no problem and no evidence to show that there is, it is incumbent on the Government to ensure that the research is done and the evidence provided, because despite all the claims that are made, we do not want more people to get into gambling problems much more quickly than they would otherwise as an unintended consequence of allowing new machines to be made available for people to gamble on.
I hope the Minister will take the remarks I have made this evening as I hope they came across—that is, as those of a concerned constituency Member of Parliament, not someone who is anti-gambling, who has the intent to close down every bookmaker or who would suggest that people should not gamble. People can gamble if they wish—I do occasionally, as do others. There is nothing wrong with that: it is a legitimate entertainment and leisure pursuit for many people—sometimes occasionally, sometimes regularly, as I have outlined. However, if we get into a situation where very many people have serious problems as a result of being able to gamble large amounts of money in a short period on such machines, that is something that the Government should address, as I hope the Minister will.
Tracey Crouch (Chatham and Aylesford) (Con)
I rise briefly to offer some cross-party support for the hon. Member for Rutherglen and Hamilton West (Tom Greatrex) and the concerns he has raised. I am not anti-gambling; in fact, I like more than a regular flutter, normally on the horses, not the football—I have much better sense than that. However, I have concerns about the proliferation not just of betting shops, but of the number of FOBTs in them. I am not one often to engage in tribal politics and I certainly do not want to do so on this occasion, but that is clearly a consequence of the liberalisation of gambling that we saw under the previous Government.
That said, it is incumbent on us as a responsible Government to try to reach a solution to the problem. I share the hon. Gentleman’s view about giving local authorities the opportunity to provide part of the solution. A cross-party working group on Medway council has recently produced a paper, to try to ensure that it can have a role to play in reducing the number of bookmakers on the high street. Bizarrely, Chatham high street is not in the Chatham and Aylesford constituency, but that is where the heart of some of these problems lies.
I can see the benefits of having fixed-odds betting terminals in betting shops, but I have concerns about the number of such machines in those shops and about the amount of money that can very quickly be staked, lost and won on them. That creates an incentive to people to go in and use the machines. I long for the day when I can go into my local bookies and queue up to place a bet on a horse, but, as the hon. Gentleman said, more people are playing on the machines than are filling out the card. In fact, I quite enjoy going into a bookies and shocking people when I place a bet on a horse. I do not think they expect a woman, let alone the local Member of Parliament, to walk into a bookies.
I am particularly concerned about the Medway towns, in which people are experiencing increasing levels of personal debt. It is an area of deprivation, and there are problems relating to the clustering of bookmakers, payday loan companies and pawnbrokers. This is an issue for the whole area. I therefore want to offer my support for the hon. Gentleman. Like him, I do not think that we should eradicate the machines from betting shops, but I believe that we should look carefully at limiting them or limiting the stakes that people can place on them.
The Minister of State, Department for Culture, Media and Sport (Hugh Robertson)
I am grateful to the hon. Member for Rutherglen and Hamilton West (Tom Greatrex) for securing the debate and giving the House an opportunity to discuss this issue. He correctly states that it is a matter of concern for many hon. Members. Let me reassure him that I do not in any way take what he said as an indication that he is either pro-gambling or anti-gambling. He made a well-balanced contribution that reflected concerns that I have heard when we have debated this issue and others associated with it. These concerns have been raised with me on many other occasions.
The hon. Gentleman is a diligent Member who does his research, and he will be aware that he is catching me at a slightly awkward time, in that the triennial review into stakes and prizes has just closed, on 9 April. My Department has received more than 9,000 responses to the review, and we are in the process of analysing them. For reasons that he and any other Members with experience of dealing with the gambling industry will know, it is important, given that these are big, litigious organisations, for any Government to proceed on the basis of evidence. I hope, particularly in view of what he has said tonight, that he has submitted a response to the millennium review.
Rehman Chishti (Gillingham and Rainham) (Con)
The consultation started in January and finished in April, but will the Minister take account of any further new evidence? For example, BBC South East carried out an independent survey of betting and gambling problems and of fixed-odds betting terminals in Gillingham and the wider Medway area, but the survey was carried out after the consultation closed. Will he take that new evidence into consideration?
Hugh Robertson
I thank my hon. Friend for that contribution. I will have to check the legalities and get back to him. The consultation period was open for a specific time, and if we were to reopen it to the BBC, we would have to reopen it to everyone else to be fair. I am slightly inclined to ask why, if the BBC was going to carry out a major study, it did not do so in time to submit it to the consultation, especially when it had three months in which to do it.
We have heard many distressing tales of where people have run into problems using the type of machines that the hon. Member for Rutherglen and Hamilton West has spoken about this evening. Each one of those stories is, of course, a personal tragedy not just for the individual, but for their friends and colleagues—and indeed, for the wider society. As was pointed out earlier, however, we also have to balance such matters with a recognition that for the majority of people, gambling does not develop into a problem. As I think the hon. Gentleman was fair enough to say, the gambling industry is a legitimate part of the leisure industry that creates jobs and harnesses investment.
According to the Gambling Commission’s industry statistics for the period April 2011 to March 2012, the gambling industry employed almost 110,000 people—a considerable number—with the betting sector making up the largest component, employing nearly 55,000 people in full or part-time posts. That makes the gambling industry a significant contributor to the UK economy. The Office for National Statistics estimated that in 2009 it was directly worth £4.9 billion in gross value added terms. What I think I am saying to the hon. Gentleman is not one thing or the other, but that there is a balance to be struck here. To be fair, he recognises that.
Let me say a few words about betting shops. The hon. Gentleman mentioned what has been a recurrent theme during recent times, about which concerns have been raised by a large number of stakeholders: the clustering of betting shops within certain local areas. The key concern—it has been raised tonight—often relates to the B2 machines and their impact on local communities in respect of problem gambling.
The overall number of betting shops has remained reasonably stable in recent years. In 2009, there were 8,862 and by September 2012 there were 9,049—not a huge difference. Those figures are well down on the peak of 16,000 during the 1960s. The hon. Gentleman is absolutely right, however, that more betting shops are relocating to the high street, which makes them more visible.
I am not entirely shrugging my shoulders when I say that planning policy is, of course, an issue for the Department for Communities and Local Government. It is relevant to the debate to note that local authorities have a range of enforcement powers—I appreciate that the hon. Gentleman would like them to have more—that can be used to manage the overall retail diversity and the viability of town centres. Tools such as article 4 directions allow local authorities to restrict nationally permitted development rights if they are not suitable for their area.
Ian Lavery
Anybody can see the clustering of betting shops on the high street. What is the Minister’s view of why that is happening, as he is right that there are fewer betting shops now than 20 years ago?
Hugh Robertson
That is a very good question. I have to tread a little carefully because of the consultation. As a Minister who has already been judicially reviewed once, over a football stadium, I am not in hurry to go through that joyous process again, to be honest, so I will tread reasonably carefully here. Many of the factors mentioned tonight may be behind this particular development. It is pretty clear where betting shops are making their money at the moment. As my hon. Friend the Member for Chatham and Aylesford (Tracey Crouch) mentioned, the pattern of betting has changed quite a lot over recent years. Betting shops are sometimes able to pay rents that other retail outlets cannot afford, there have been changes in shopping patterns and there is also the changing nature of the high street. All those things are factors, but I will not go a great deal further than that until we have had the chance to analyse the responses to the consultation.
Mr Slaughter
Let me try to push the Minister a little further. It is perhaps not so much the absolute numbers or even necessarily the clustering itself that is the issue, but where the clustering is taking place. In my relatively poor constituency, there are two or three times the number of betting shops as there are in neighbouring more prosperous constituencies. In Chelsea or Richmond, a third or half the number of betting shops will be found than in an area such as Shepherd’s Bush. That is the concern.
Hugh Robertson
The hon. Gentleman made his point very well. The rent that betting shops with machines of this kind are able to pay is crucial. Presumably, if they move to Chelsea the retail rents will rise, and that may price them out of the area. There is almost certainly a social element in all this, and I suspect that that is the answer that the hon. Gentleman hoped I would give him. We will consider all the evidence in the course of this review and the review that will be undertaken in due course by the Remote Gambling Association. I shall say more about that shortly.
Robert Flello
Is the Minister saying that the work that he and his civil servants are considering will include a mapping exercise to establish where betting shops are located in relation to, for instance, the index of deprivation?
Hugh Robertson
It is important to note that two separate reviews are taking place. The triennial review of stakes and prizes closed on 9 April, and produced 9,000 responses which we must work through. The wider issues will be addressed by the review that will take place next year, and I hope that we will be able to reach some worthwhile conclusions on that basis.
The Gambling Commission’s statistics show that between March 2011 and April 2012, an average of just over 35,500 machines were capable of offering B2 category games in betting shops in Great Britain. The number has remained relatively stable since 2009, but, as was pointed out by the hon. Member for Rutherglen and Hamilton West, that stability has occurred at a time when machine numbers elsewhere have declined. For example, according to Gambling Commission figures, the overall number of gaming machines fell by 10% between 2011 and 2012, and the number of B2 machines increased by 1% during the same period. That would appear to show that B2 machines are popular consumer products, which may give rise to some of the problems identified by the hon. Gentleman. They are, of course, also crucial to the profitability of many betting shops.
I absolutely agree with the hon. Gentleman that, in the light of concerns raised by him and others, it is appropriate for the Government to look into the issue. I assure him that I am well aware of the concerns that he and many other Members have expressed about B2 machines in particular. In dealing with the problem, for reasons that I have already given, I must proceed on the basis of evidence. I hope that the combination of the two reviews that I have mentioned will give us the evidential base that we need in order to work out exactly what is happening and what needs to be done as a consequence. We want to balance the harmful effects that he and many others have described with the contribution that gambling properly makes to employment and the local economy in many areas, which has been mentioned by Members on both sides of the House.
I congratulate the hon. Gentleman both on securing the debate and on the way in which he has prosecuted his case. The evidence that he has presented illustrates the problem, and as he said, it is up to the Government to determine how best to tackle it. I can reassure him that the Government are listening—I am absolutely listening—and that we will take action if it is necessary. However, we must act on the basis of the evidence that is available to us.
Ian Lavery
I thank the Minister for giving way again. There is evidence that it is possible to spend £18,000 in an hour on FOBT machines. I agree with the hon. Member for Chatham and Aylesford (Tracey Crouch) that the people whom we should be looking after are the most vulnerable in society. Like every other Member who is present tonight, I recognise that that is the case and that there is a problem with these machines. We need a fair and balanced review. We need people to be honest about this. People cannot lose £18,000 in an hour on one of those machines. They can go to Cheltenham and spend £100,000 in one minute on one bet; they can put £250,000 on a horse in one minute with one bet. We would not multiply that by 60 and say that is how much money people can spend at Cheltenham, and then look to prevent them from doing so. That is a ludicrous argument.
Hugh Robertson
I understand much of what the hon. Gentleman is saying. The challenge for us as a Government and me as a Minister is to work out a way to deal with the problem that has rightly been identified—the fact that some people get addicted through this sort of gambling—but to do so, if we can, in a way that does not discriminate against the many people who use those machines perfectly safely and perfectly reasonably, and not to overdo it in such a way as to harm the local economy and the employment prospects of many of the hon. Gentleman’s constituents. It is a question of getting that balance right.
Graham Jones (Hyndburn) (Lab)
The Minister talked about a solution that involves the Government, but has he had any conversations with his colleagues in the Department for Communities and Local Government about licence fees and local authorities, because they have a role to play in this and they can represent their communities? If the licence fee cap by Whitehall were lifted and they were able to make their own local decisions on what the initial fee should be and what the annual fee should be after that, that might have an impact on the high street, with decisions being made by local government and therefore taken out of the hands of central Government. Has the Minister looked at those questions, and has he had any conversations with his colleagues in DCLG?
Hugh Robertson
The simple answer is that we are in constant contact with DCLG. The Under-Secretary of State for Communities and Local Government, my right hon. Friend the Member for Bath (Mr Foster), used to speak on these matters for the Lib Dems and is now the Minister with responsibility for them. He is very much across the subject; he understands these points extremely well, and all of them will be looked at. Let me make the point again, however, that we have to follow the evidence, which is precisely why we are trying to put these two studies together.
Mr Hamilton
I congratulate my hon. Friend the Member for Rutherglen and Hamilton West (Tom Greatrex) on securing this debate, because I have learned one or two things tonight. I have constituents who have come to see me about some real problems. The comparisons that we must think about, however, go further than those he has made. We take into account the fact that local pubs, clubs and bingo halls also have machines, but not machines of such an infectious nature, perhaps because they cannot afford the licence. The comparison that has to be made is this: are people more likely to go to the betting office to get a bigger gamble or go to the local pub or bingo hall where the sums they can put in are limited to 10p, 20p or £1, which is the highest stake?
Hugh Robertson
I thank the hon. Gentleman for making that point. It is, indeed, in theory perfectly possible—although we will have to wait and see where the evidence from the consultation leads us—to deal with one set of machines in one way and another in another way, and we may want to do so to reflect the different reasons why people play.
Mr Slaughter
One piece of evidence the Minister may take into consideration is that the average spin on a B2 machine is about £15, which is seven or eight times the maximum on a B3 machine. That, rather than the possibility of spending £18,000 in an hour, is what concerns to me. This is an anomaly, because these are off-site betting opportunities, where the server is off-site, and suddenly people can gamble a much higher sum. I am sure the Minister is aware of that, although he may not be commenting on it tonight. That is a major difference with regard to the type of gambling that has just been talked about, which is available now just by walking off the street.
Hugh Robertson
The hon. Gentleman makes a fair point of which I am aware. I hope everybody who has spoken in the debate contributed to our consultation; if so, their responses will be lying there among the 9,000 that I am sure my civil servants are looking forward to wading through over the coming months.
Once again, I congratulate the hon. Member for Rutherglen and Hamilton West on securing this debate; it proved a popular activity for an hour. I assure him that we are listening and that we will act on the available evidence, for all the reasons I set out tonight. We will also listen carefully to all the responses to our consultation.
Question put and agreed to.
Ministerial Correction
International Development
(11 years ago)
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Rehman Chishti
To ask the Secretary of State for International Development what progress has been made in meeting her Department's target for female children attending primary school in Afghanistan.
[Official Report, 13 March 2013, Vol. 560, c. 280W.]
Letter of correction from Alan Duncan:
An error has been identified in the written answer given to the hon. Member for Gillingham and Rainham (Rehman Chishti) on 13 March 2013.
The full answer given was as follows:
Mr Duncan
DFID has made a large investment in improving education provision in Afghanistan for all children over the last decade. UK development funding through the Afghanistan Reconstruction Trust Fund has contributed to 5.9 million children attending school in 2011-12. This includes 2.3 million girls, compared with virtually none under the Taliban. We have therefore exceeded our Operational Plan target of contributing to 2.1 million girls attending primary school by 2013-14 and will be working with the Afghan Ministry of Education as they develop new targets.
The correct answer should have been:
Mr Duncan
DFID has made a large investment in improving education provision in Afghanistan for all children over the last decade. UK aid funding through the Afghanistan Reconstruction Trust Fund since 2002 has contributed to 4.1 million children attending school in 2011-12. This includes 1.6 million girls, compared with virtually none under the Taliban. The latest data for the 2012-13 school year will be available from the Afghan Ministry of Education in July 2013.
Westminster Hall
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Backbench business
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Immigration (Bulgaria and Romania)
(11 years ago)
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Mark Pritchard (The Wrekin) (Con)
I beg to move,
That this House has considered the e-petition relating to immigration from Bulgaria and Romania in 2014.
It is an honour to serve under your chairmanship, Mr Walker. I am grateful to the Backbench Business Committee for giving me and other colleagues the opportunity to speak on this important issue.
Much has been discussed, in recent weeks, about EU and non-EU migration. In many ways, Bulgarian and Romanian migration from inside the EU cannot be fully contextualised unless it is placed in the wider immigration debate about those who want to settle in Britain from outside the EU. In all such discussions and debates, I believe that tone, accuracy and objectivity, rather than subjectivity, must be our goal as policy makers—to articulate fact rather than fiction, to be pragmatic rather than ideological, and to seek out solutions rather than scapegoats. As legislators, our responsibility lies not only in what we enact, but in what we articulate. Words still have power in politics, especially in the sensitive area of immigration. I am sure that this afternoon, the tone and content of Members’ contributions will show that the House of Commons is in touch with all the communities it represents while ensuring that the debate attracts more light than heat.
However, it is true that there is little trust between the public and mainstream parties on immigration. Is that any surprise? So often, the public have been misinformed and misled about the true impact of immigration. That is something that the Labour party has recently recognised and admitted, which is welcome, but it cannot right the wrongs of the past decade. Labour’s open-door policy broke the trust between politicians and the public on an issue where public trust is vital.
Immigration is part of our ongoing national narrative and it needs trust from all communities, including immigrant and migrant communities. Whatever politicians say, no politician—however clever, however insistent, however tough their rhetoric—can spin their way out of people’s experience of the impact of immigration on their everyday lives. Individuals, families and communities in rural and urban areas have felt the rapid social change that mass migration and immigration can bring. It is undeniable that EU migration impacts on schools, hospitals, public transport and social housing queues. It is real-life experience, not exaggerated politics.
Let me put on the record that immigration has brought many benefits to this country. One only has to look at the national health service and the armed forces and immigration’s benefits are clear. There are many other examples, which colleagues will no doubt underscore this afternoon. In my constituency, immigration has brought many economic benefits in the rural industries, in local manufacturing and in other areas. It is also right that Britain should remain attractive to genuine foreign students and those who fill national skills gaps in so-called “shortage occupations”, such as paediatricians, maths teachers, chemical engineers and in other skills and professions. Again, international students can be found in Shropshire—as they are found all over the country—in for example, the Defence College of Aeronautical Engineering or Harper Adams university.
Britain is very much open for business, and may that always be the case. The to-ing and fro-ing of foreign nationals coming here to work and study is nothing new, but in recent years, the scale of those who have abused their visa status and British hospitality and generosity has been unprecedented. That is why mainstream political parties must be willing to talk about it and take action. By doing so, we, as a Parliament, isolate extremist and fringe parties. It is my view that the duty of all legislators is to hold an open and honest debate about the benefits of immigration and migration to Britain, while acknowledging that there are some disbenefits, and that there can be real societal changes as a result of uncontrolled immigration.
That is why I am pleased that a Conservative-led Government have taken action over the past three years to reduce such abuses. I am also glad that our coalition partners have finally caught up with us.
Wayne David (Caerphilly) (Lab)
Before the hon. Gentleman moves on, will he acknowledge that there is a great deal of concern that migrant workers from the countries of the former eastern bloc have been exploited, and that wage levels of indigenous workers have been undermined? Does he accept, therefore, that it would be very positive not only if there were an emphatic endorsement of a minimum wage, but if prosecutions went to court—none have over the past two years—for breaches of the minimum wage?
Mark Pritchard
I am grateful for the hon. Gentleman’s intervention, because he prematurely comes on to points that I will raise later, when I will be happy to address his specific question.
The Deputy Prime Minister rightly pointed out in a recent speech that
“in order to remain an open and tolerant Britain, we need an immigration system that is zero-tolerant towards abuse.”
He is right—the British are tolerant, but they are also intolerant of abuse of all kinds. That is one of the great hybrid virtues of Britishness. That said, I reject our junior partner’s idea for a security bond. It is neither practical nor—probably—administratively workable, and it may also discriminate against those who are genuinely seeking to stay a short time in Britain, but who do not have access to support funding. There should be no penalising of legitimate visa applicants.
Chris Bryant (Rhondda) (Lab)
I am glad that the hon. Gentleman understands the Liberal Democrat policy better than I do, because it was not clear exactly what the bond was meant to relate to—to family visit visas or to spouse migration into this country, similar to the situation in Australia, where anybody, such as a church, an organisation, or somebody else, can put down a financial assurance that somebody who is coming as the spouse of an Australian citizen will not be claiming on the taxpayer. Does the hon. Gentleman see the two in the same or a different light?
Mark Pritchard
We will have to wait and see the detail. In general, I do not support the policy, but in terms of the specifics and details of particular categories, it may well apply. There may be a case for a bond relating to higher risk work visas, where either the employee or the employer puts up the bond, but that does not make the case for a general catch-all policy. I hope that that, in part, answers the hon. Gentleman’s point.
Bob Stewart (Beckenham) (Con)
On that point, let us clarify that it is not Government policy to have any sort of bond at the moment. Does my hon. Friend agree?
Mark Pritchard
That is right, but I take the Deputy Prime Minister’s words on bonds seriously. Clearly, I would not want to break the bond in the coalition, and I welcome his abandonment of the Liberal Democrat policy of an amnesty for illegal overstayers who have been in Britain illegally for more than 10 years. That would have given the green light for even more abuse—perhaps it is a welcome case of the dog wagging the tail.
As the Chairman of the Select Committee on Home Affairs will know—I understand that he is on his way to this debate—the sheer number of overstayers is a real challenge. According to his Committee, the backlog could take a quarter of a century to clear. It is a shame that he is not here yet, because I suspect that he will be Lord Speaker, the Speaker in the House of Lords, by then; he will have to check Hansard. That is why new and innovative thinking is needed.
My own view is that new immigration enforcement will never have the level of information, resource or manpower to clear that backlog sufficiently. That is why I think that the Government should consider new policies and perhaps even the following suggestion. Anyone who is an overstayer on any visa—work, tourist, student, family and so on—who does not declare themselves to authorities by 1 April 2014, or a date to be agreed, and regularise their visa status, and is subsequently caught, will be banned from re-entering the United Kingdom for 20 years or an agreed tenure. Those who do declare themselves will be asked to leave, but could reapply to return to the UK on a future visa after a period of 12 months, or a similar period to be agreed. Those who regularise their status will be rewarded; those who continue to abuse the system will receive a sanction.
Chris Bryant
The hon. Gentleman did not say, but I presume that he means non-EU nationals, because if he means, and includes, EU nationals, he has to make the same deal for British citizens.
Mark Pritchard
In my preamble, I said that I would be speaking about non-EU immigrants before coming on to the particular—[Interruption.] Giving contextualisation I called it—giving context. If the hon. Gentleman will just be a little more patient, the narrative of the debate will become a little clearer. I have answered the point: it is non-EU specifically.
The system that I have set out incentivises people to declare themselves to the authorities and, I believe, would reduce the number of overstayers and the challenge that the authorities face to apprehend them. This is not an amnesty. These are hard-headed sanctions for those who abuse the system and for whom the system is inadequately equipped, given the huge—mountainous—legacy left by the last Labour Administration.
Similarly, UK Visas and Immigration as it is now called should ensure that all new applicants applying for visas are aware of the penalties for overstaying. Those could be financial and, similarly, the visa sanctions that I have just outlined. The Government might also consider further financial penalties for sponsors of visas who knowingly mislead authorities. As the Deputy Prime Minister has rightly said:
“The challenge isn’t just stopping people coming into Britain illegally, it’s about dealing with individuals who come…legitimately but then become illegal once they’re already here.”
However, there is good news: things are, finally, being turned around. This Government have cut net migration by one third. In real terms, that means that over the last three years 250,000 fewer immigrants have come into the UK than would have been the case under the last Government. This Government deserve much credit for their record, not least for rooting out 600-plus bogus language schools and colleges and for doubling fines for unscrupulous employers—a subject that was touched on earlier—for hiring illegal workers. Often, they are hired for less than the minimum wage and exploited, with their rights suspended. I hope that the hon. Member for Caerphilly (Wayne David) will welcome the doubling of those fines.
I would now like to narrow the debate, answering the point made by the shadow Minister, the hon. Member for Rhondda (Chris Bryant)—
Wayne David
Does the hon. Gentleman share my view, then, on this matter? Would he like to see prosecutions brought in the courts against people who deliberately break the minimum wage law?
Mark Pritchard
Of course. I think that there would be consensus on that issue and I hope that there will be consensus on a lot of what is being shared by all of us today. Absolutely, but there is a huge legacy that this Government are having to tackle.
I would now like to narrow the debate to the particular, rather than the general, and deal with Bulgaria and Romania. On housing, I welcome the Government’s recent announcement, ahead of the transitional border controls on Bulgarian and Romanian migration being lifted on 31 December, that they will introduce sanctions for private sector landlords who house illegal immigrants, many of whom are kept in over-occupied, cramped and often squalid conditions. These are similar sanctions to those that we have just discussed vis-à-vis employers. Migration and immigration remain the biggest driver of housing growth—housing demand that puts pressure on many of the communities represented here today.
I also welcome the recent announcement by my right hon. Friend the Prime Minister that the Department for Communities and Local Government will soon issue clearer guidance to local authorities and councils about ensuring that priority for housing is given to local people through an habitual residence test. However, my view is that that policy should be set out in binding legislation rather than as guidance, as should the policy of giving housing priority to our armed forces. There should be no opt-outs. According to the Government, only half of all councils currently set local residency tests. That needs to change. The reality is that some councils, especially in some urban areas, may be tempted, for political reasons, not to implement that policy.
The Prime Minister, in his recent speech in Ipswich, was also right to say that Britain should not be a “soft touch” for “benefit tourists”. I am glad that my right hon. Friends the Health Secretary and the Home Secretary have expressed a similar view. That needs to be the case, whatever people’s nationality. This is not isolated only to European migrants, but our focus today is on Bulgaria and Romania, and a BBC poll, issued at five past midnight today, suggests that no more than 4% of Bulgarians and 1% of Romanians might consider coming to the UK in 2014. Given that 150,000 Bulgarians and Romanians are already here, under the permitted work scheme and via other routes, I suspect that the “Newsnight” poll is somewhat timid in its estimate, but even if those percentages are accurate, that would mean 350,000 people from each working-age population, from each of the countries, arriving in the UK. I refer the hon. Member for Rhondda to one of the headlines in tomorrow morning’s papers if he does not believe that to be the case. [Interruption.] He does not know which one yet.
Mr Philip Hollobone (Kettering) (Con)
I congratulate my hon. Friend on his speech. I also praise him for his reference to the BBC “Newsnight” poll. The BBC is spinning that that suggests that very few people will be coming to our shores from Romania and Bulgaria, but in fact it probably means the opposite, because, of the 73 million people who live in the A8 accession countries, 1.1 million have come to our shores, which is a rate of 1.5%.
Mark Pritchard
My hon. Friend makes a very helpful contribution to the debate, as he always does. I am grateful for his analysis, which he has obviously done over the last few hours since the poll came out. I come back to the point that it is a significant amount. Whether it is 1%, 1.5% or 4%, it is a significant amount of people for communities to absorb and public services to serve.
We hear that Germany is toughening up its rules, finding ways around EU strictures. Coupled with Spain’s high unemployment rate and comparatively low benefits, that makes the UK an increasingly attractive option for many where poverty is still widespread and the minimum wage is one third of what it is in the UK. I do not question the integrity of the BBC poll, but I do question its interpretation.
EU migration affects schools as well. I am sure that colleagues know examples of how demand for school places has meant that some parents cannot send their children to their school of choice because of the influx of EU migrants. Some families have had to place siblings in different schools as a result. Of course, that can also happen because of other, unrelated demographic changes, but it is certainly the case that a lot of this is happening because of demands from immigration.
There is also the impact from teachers and classroom assistants giving special attention to children who do not speak English. That can be disruptive to the rest of the classroom. It is disruptive to school life and a distraction for other pupils. There is also the cost to local education authorities and school budgets of translation and interpretation.
Similarly, EU migration has an impact on local GP services, acute hospital trusts and wider primary care demand, which is why the Government are right to try to recoup millions from other European economic area Governments when their citizens use the NHS. It should have been happening for years, but it has not been. Hospitals might be required, through statute, to do their bit, perhaps with financial incentives for trusts to co-operate with the Government on the legal status of the patients they look after. Surely NHS trust boards should have a duty to ensure that those they treat, save in emergencies, are those who have the first right to be treated. That is not lacking compassion, but recognising that the NHS, even with record funding under the Conservative-led Government, has finite and scarce resources—it is the national health service, not the international health service. Britain must remain an open and tolerant society, but we cannot be the hospital for the world. Health tourism must end, and health trusts, not only the Government, have a major role to play in delivering fairness in treatment.
Chris Bryant
I sympathise with the hon. Gentleman’s point about people from other countries using the NHS, though we have always had bilateral agreements with many countries, so there is a process of recompense. A lot of British people, many of whom are older, are based in Spain and have a problem getting NHS treatment there, so many of them come back to the UK to use the service here. The real issue is that the NHS here, unlike everywhere else, is non-contributory, but he would not want to change that, would he?
Mark Pritchard
No, not at all, but the hon. Gentleman’s point is a bit of a red herring. He is right: 1.4 million UK citizens live in the other 27—26 plus one—EU states, several hundred thousand of whom live in Spain, as he points out. But I think he knows full well that my point is that the previous Labour Government, over 13 years, failed to recoup any funds, which, as he alluded to, they could have done and which this Government are doing. I hope he will support that policy.
Mark Field (Cities of London and Westminster) (Con)
Will my hon. Friend give way?
Mark Field
My hon. Friend has made a robust case. I represent this area, which has two big hospitals— St Mary’s Paddington and Barts—that have had a significant problem with NHS tourism going back many decades. Does he not recognise that many doctors feel strongly about the Hippocratic oath, so they would be very reluctant to have any sort of pecking order, whether of UK and non-UK citizens or EU citizens and others? Some of the problems he has identified therefore, real though they are, will be incredibly difficult to resolve. It is wrong to make too much of a party political point on the subject; yes, there have been problems, but I know St Mary’s Paddington has done a hell of a lot of work to get a lot of the money back, although significant NHS tourism is still unrecompensed.
Mark Pritchard
I was not making a party political point; I was merely making a statement of fact. The Government are rightly seeking to recoup funds from EEA states and the previous Government failed to do so. With regards to the particular points my hon. Friend raises, first, those same GPs know that the NHS has scarce resources and, secondly, whether GPs are prepared to deal with health tourism or not, let us at least discuss it with the General Medical Council, the British Medical Association, GPs and acute trusts and primary care trusts—now clinical commissioning groups. We need a grown-up discussion about whether we should do it. I believe we should and the Government appear to think the same—or I think the same as the Government—so it is a matter of how we do it. It is right and fair for the British taxpayer and the British people that we do so.
Mark Pritchard
I shall give way to my right hon. Friend after my hon. Friend the Member for Cities of London and Westminster (Mark Field) has intervened.
Mark Field
My hon. Friend makes a fair case about trying to change attitudes in the NHS—among GP commissioners and in hospital—but I hope that he recognises that some moneys will inevitably be incredibly difficult to get back, partly due to the ethos of the medical profession, and it would be wrong to second-guess that to any large extent.
Mark Pritchard
I give way to my right hon. Friend the Member for Mid Sussex (Nicholas Soames).
Nicholas Soames
I congratulate my hon. Friend on his speech on this important matter. I endorse his point. There is nothing political in this. People all over the country feel strongly about it. I reassure him that the cross-party group on balanced migration called on the Secretary of State for Health this morning to discuss that very matter. It is clear that the Secretary of State understands the need for movement on this and I am hopeful that plans will shortly be announced that will deliver clarity. Most of all, clear direction from the Department of Health is required.
Mark Pritchard
I am grateful to my hon. and right hon. Friends for their interventions. My hon. Friend the Member for Cities of London and Westminster is absolutely right that we are all treading in a new area, but it is an area that we should enter; the public expect us to enter it and this is a timely moment for us to do so.
I thank my right hon. Friend for all the work that he has done over many years with his cross-party group, taking on often complex, challenging and sensitive issues with a measured vocabulary and a balanced context. I congratulate him on that. I was not aware of the discussion he mentioned, but I am delighted to hear about it. It shows that the Government are serious about NHS tourism and follows earlier comments from the Health Secretary only two or three weeks ago following the Prime Minister’s immigration speech in Ipswich, which I shall touch on later.
In defence of EU migrants, in particular with regard to jobs and employment, there are jobs that migrants are prepared to do that some British people are not prepared to do. For example, it can be difficult for some British farmers to find people to do fruit picking, which is hard, back-breaking work—I know, because I have done it. I picked strawberries on a Herefordshire farm as a student. As hon. and right hon. Members know, Herefordshire and Shropshire strawberries are the best in the world, but somebody needs to pick them. Hopefully, the new welfare reforms will reduce the number of British people refusing to take jobs. The Prime Minister recently stated that
“we can’t allow immigration to be a substitute for training our own workforce and giving them incentives to work.”
Immigration policy cannot be prejudiced by the unpreparedness of British people who are unwilling to work. Those who can work, should work or lose their benefits. Those who genuinely cannot work should get more help. Laziness can no longer be the rationale for a lax immigration system.
The Government are right to toughen up the English language test. If people cannot speak English, how can they be expected to find a job? They are open to exploitation and destined for hidden sweatshops and the subterranean labour market. That is not good for them and not good for those who care for and love them. Britain must remain an open and tolerant society, but we can employ the world.
Can the Government extend the transitional border controls at the end of the year? In my view, that would be the best outcome of all and was part of the wording of the Downing street e-petition to which the debate today is addressed. There is somewhat of a paradox. Article 23 of the Schengen borders code states that member states can reintroduce border controls:
“Where there is a serious threat to public policy or internal security”.
It is interesting to note that today the Joint Committee on the National Security Strategy, of which I have the honour to be a member, will commence taking evidence from experts on national security and the EU, and will look at the national security challenges should the eurozone contract or collapse, with the likely mass movements of peoples throughout Europe—what I call, “a currency famine.”
Interestingly, article 23 has been implemented 26 times so far, most notably in Norway. The UK is, of course, not part of Schengen, but there are other provisions, including paragraph 22 of the EU’s free movement directive, which allows
“restrictions to be placed on the right of free movement and residence on the grounds of public policy, public security or public health”—
restrictions that are referred to as “special measures”. I hope that the Government will explore those legal definitions in more detail, while noting their obligations under existing treaties.
Chris Bryant
All that would allow Britain to do would be to enforce the rules we currently have because we do not subscribe to the whole of Schengen. Furthermore, the situations in which it has been used in other countries, such as in the discussions about the borders with Greece, show that it is used in truly exceptional circumstances and expressly forbids merely migratory transition.
Mark Pritchard
I am not saying that there is a legal route, but as a politician I do not subscribe to the view that “We have always done it this way” is the best way to answer every question. I take the view: “This is the challenge; this is where we are. Let us explore every avenue to get over the challenge.” It is incumbent on me, albeit as a minor legislator and a Back Bencher, to represent my constituents and to try to find a way, and I believe that where there is political will, a way will always be found.
On the control of our borders, I would like to see Britain ultimately take back full control. As more countries from the Balkans accede to the European Union, EU migration will become more, not less, of a political, social and economic challenge. I hope that taking back sovereign control of our borders, while avoiding pulling up the drawbridge, will be integral to the Government’s review of EU competences, on which my hon. Friend the Member for South Northamptonshire (Andrea Leadsom) has done a huge amount of work. It is in our national economic and security interests to ensure that our borders are secure and that we regain the sovereign right to close them or, when necessary, to limit the numbers of those transiting them.
Chris Bryant
Based on our existing treaty obligations, the only way in which the hon. Gentleman could do that would be to leave the European Union. Is that not true?
Mark Pritchard
No, not at all, but on the issue of leaving the EU, thank goodness that at last, because of the Conservative-led coalition Government, the British people will have a say with an in-or-out referendum in 2017-18. The hon. Gentleman is falling into the trap of saying “We have always done it this way. There can be no change because we know no other way.” What I am calling for today is for border controls to be within the review of EU competences. Is it now the policy of Her Majesty’s Opposition to wish not even to discuss regaining some sovereignty over British borders? Perhaps the hon. Gentleman would like to answer that.
Chris Bryant
The hon. Gentleman is being absolutely preposterous in his argument. He knows perfectly well that if he wants to completely and utterly “have the right to close our borders”—his words, I think—to anyone from other European Union countries, we either force those countries to leave the union, or we leave it ourselves. We have treaty obligations to those people and, in fact, there was not even a vote in the House on the question of whether Bulgaria and Romania should join the European Union, because there was unanimity that they should do so, under the terms of the treaty as was provided.
Mark Pritchard
We will wait and see—we do not know whether what I have said will happen in the short term—but, as a highly intelligent man, the hon. Gentleman knows that all treaties can, at least in principle, be subject to amendment and change. I rest my case on that point of fact.
In conclusion, Britain has benefited much from EU migration and immigration, but there have also been disbenefits. Figures from the previous Government, following the last influx of European migrants in 2004, showed that their estimates had been spectacularly wrong. I pay credit to Migration Watch UK, which arguably has the best and most consistent record on immigration data. It estimates that 250,000 Bulgarians and Romanians will move to the UK between 2014 and 2019 and, as we heard earlier, the figure could be higher. Such an influx will reshape communities, affect public services and strain social cohesion.
We need to bear down on racism and xenophobia, but one of the best ways of doing that, as policy makers, is not through reactive policies but through preventive and proactive ones that make a difference to people’s lives, and a balanced immigration system that works. The British people are tolerant people, but they want an immigration system they can trust, that is fair and that helps the most vulnerable, not one that takes advantage of British generosity of heart and British hospitality. The Government are making genuine progress in achieving that, but there is still much to do.
Keith Vaz (Leicester East) (Lab)
It is a pleasure to serve under your chairmanship, Mr Walker. I apologise to the hon. Member for The Wrekin (Mark Pritchard) and to other hon. Members present that I was not here at the beginning of the eloquent opening speech. I and other parliamentary colleagues were attending the 20th anniversary memorial service for Stephen Lawrence at St Martin-in-the-Fields, which was still going on when I left.
I congratulate the hon. Gentleman on securing the debate, and the thousands of people who signed the e-petition. He put his case in his usual elegant and eloquent way, and very robustly. Although I do not think that we will get a solution in this Chamber today to the problems he has raised, I hope that by having the debate we can show the public and those who signed the e-petition that Parliament is prepared to discuss this very important issue openly and transparently, and not leave it to fringe parties that are not represented in Parliament to take control of the debate.
As the hon. Gentleman said, there are now eight months to go before the lifting of transitional arrangements, which, broken down, is 6,072 hours, 253 days or 36 weeks. My hon. Friend the Member for Rhondda (Chris Bryant) said that we are a Parliament that welcomes enlargement—the enlargement arrangements went through the House with no one voting against them. I declare my interest as Minister for Europe when the enlargement of the EU began in earnest, and I well remember visiting Bucharest and Sofia, and the other eastern European countries, and telling them that Government and Opposition were united in ensuring that Romania and Bulgaria, and indeed the other countries, should enter the EU, so that for the first time in many decades we would have a united Europe.
I welcome enlargement. It has provided enormous benefits for our country, and in a discussion of this kind we should recognise that it has been an essential part of the European policy of successive Governments. However, there is a clear national feeling, the depth and scale of which is shown by the number of people—some 145,462—who had signed the e-petition by 2 pm today, and unless we discuss the matter, and unless the Government are prepared to come up with some solutions to the issues that have been raised, I fear that this will become a dominant issue as we approach the next general election. It is therefore important that we have this debate.
Tomorrow, the Home Affairs Committee will take evidence from not only the Romanian and Bulgarian ambassadors—it is important that we hear their side in Parliament—but the Minister, and I will listen to his speech and those of other hon. Members so that I can prepare my notes for his session before us tomorrow.
The hon. Member for The Wrekin was absolutely right: at the heart of this debate is the issue of numbers—the estimates. Over many months, at Home Office questions and through written parliamentary questions, I have pressed the Home Secretary and the Minister on the need for estimates. On 21 October 2008, the then shadow Immigration Minister, the right hon. Member for Ashford (Damian Green), said that one of the greatest failures of the last Government was the failure to predict the consequences of enlargement in 2004. That is why it is vital that we get proper estimates of how many people will come here on 1 January next year.
Chris Heaton-Harris (Daventry) (Con)
I do not say this in a tongue in cheek way, but the right hon. Gentleman was the Minister for Europe at the time the first accessions were happening, so what advice can he give the Government about getting the right estimates? The last Labour Government’s estimates were truly, wholly and completely inaccurate, and he would have been in receipt of them. Based on his experience, what questions should the Minister ask his officials?
Keith Vaz
The hon. Gentleman will have to wait for my memoirs to get all the information, but he is right that critical questions should have been asked. The headlong rush to try to enlarge the EU, which was supported by the Government and the Opposition, did not really take into consideration the numbers who would eventually come. The question was never really put properly and never really answered, which is why, with the benefit of hindsight, I hope Ministers will learn from the mistakes that were made, and mistakes were made, because research should have been commissioned. I hope he will learn from the mistakes made by myself and others, who did not ask the right questions.
Andrea Leadsom (South Northamptonshire) (Con)
Does the right hon. Gentleman not recall whether, since other countries had transitional controls in place, it was considered that Britain should perhaps do the same? Was there a thought process that he went through?
Keith Vaz
At the end of the day, although one wants to big oneself up as Minister for Europe, the decision was finally made at a much higher level, and I am not trying to pass on responsibility. However, the fact is that we should have looked at that and at the reasons why these things happened. That is why I hope we can learn from the mistakes that were made and ensure that proper research is commissioned, but the Government have categorically refused to do that.
Chris Bryant
Only my mother calls me Christopher, Mr Walker. However, while reading recently, I was struck by the fact that the person who produced the original report for the then Government claims that, if we read all 85 pages, it was remarkably accurate on probable EU migration from the A8 countries to the UK. Unfortunately, all the different political classes at the time relied only on a headline, which was wholly inaccurate. I suspect that it is possible to map out the numbers rather better than has been done in relation to next year.
Keith Vaz
My hon. Friend was my successor as Minister for Europe, and I do not know whether he had the chance to look at any other documents, but whatever the debates and the arguments were, we were where we were. Bearing in mind that we were in that position, let us not repeat the same mistake.
The estimates of the number of people coming here after 31 December range from 10,000, according to the Romanian ambassador and research commissioned in Romania, to 50,000, according to Migration Watch, as the hon. Member for The Wrekin correctly said. That is a big difference—about 40,000 people. We need to look at that as the central part of our debate about Romania and Bulgaria.
Stephen Barclay (North East Cambridgeshire) (Con)
The right hon. Gentleman seemed to say that the questions that should have been put were not put, while the shadow Minister says that a detailed report actually set all these things out but was ignored. Those two positions are clearly contradictory. Why is that?
Keith Vaz
Not really, because I finished being Minister for Europe in 2001, and enlargement took place in 2004, so I do not know what report he is referring to. As the hon. Gentleman will find out when he serves in government and then ceases to be in government, Ministers are not prepared to share their reports with former Ministers, unfortunately—perhaps we should ensure that that changes.
Mr Hollobone
May I gently correct the right hon. Gentleman? I am following his speech closely. The 50,000 people a year estimate he mentioned from Migration Watch is in fact a central estimate. The range Migration Watch gives is between 30,000 and 70,000 per year.
Keith Vaz
That is extremely helpful. That is the figure I have.
Let me move on to the next report that was commissioned: the report by the National Institute of Economic and Social Research to this Government. The report contains no estimates, and when that was put to the Home Secretary on 18 December, when she appeared before the Home Affairs Committee, she said she was “looking at the issue”. On 23 January, she said that, given the uncertainties, it was not “practicable to draw” any “conclusions on future numbers”. However, on the BBC on 13 January, the Secretary of State for Communities and Local Government said there would be an “influx” of Romanians and Bulgarians, increasing pressure in terms of existing housing shortages. Only last Thursday, when the Home Secretary appeared before the Select Committee, she could provide us with no further information. On 20 February, the Deputy Prime Minister said on his weekly LBC show that there were “guesstimates”. He added that he would not “lend too much credence to estimates which may well go on to prove to be inaccurate”.
At the heart of this is the need for us to have clear estimates and predictions, and we can, because we all acknowledge that this is an issue, so we might as well get the estimates and the research done. I hope the Minister will say he will do that when he responds to the hon. Member for The Wrekin later in the debate, and certainly before he comes to the Select Committee.
Wayne David
Does my right hon. Friend accept that one very real difficulty in estimating the numbers likely to come here from Romania and Bulgaria is that many of the calculations are based on what happened when the A8 countries were allowed to have full access to our markets? At that time, the British economy was booming; now it is flatlining.
Keith Vaz
That is absolutely right. In addition, of course, a number of other countries will also lift their restrictions on 31 December—a point the Home Secretary made to the Select Committee. Even given that, however, it is still important to have the information at hand so that we can have an informed debate and make an informed judgment. We need that information when we look at local services, which I think are at the kernel of local people’s criticisms when they sign this petition; indeed, the second part of it is all about benefits, housing shortages and, indeed, access to medical care. If we do not have the information, our services will be under enormous pressure.
Chris Heaton-Harris
We need to learn the lessons of the past properly. Three members of the Public Accounts Committee are here today—my hon. Friends the Members for Peterborough (Mr Jackson) and for North East Cambridgeshire (Stephen Barclay) and myself—and we see only too regularly examples of Departments operating in silos and the inability of the best of our civil service to understand the reports they provide to Ministers. I therefore wonder whether there was much cross-departmental working on reports in the right hon. Gentleman’s time and the time of the shadow Minister. The right hon. Gentleman has just mentioned a number of Departments, and I wonder whether the Minister can talk about the cross-departmental working that is going on now to deal with these issues.
Keith Vaz
It is important that the matter should cross Departments. Yes, there was some work—I cannot remember all of it, because it was 13 years ago—but I am worried, knowing that there are three members of the Public Accounts Committee present, that it might call me to give evidence. I cannot remember anything very much, so it would be better to call my successors as Minister for Europe. They might be able to help.
On the point about benefits, it is worth noting that at the time of the A8 enlargement, the number of Poles claiming JSA was less than 7,000 out of the 500,000 who came here. However, I recall a parliamentary reply about the number of people from EU countries who claim benefits for children who are not resident here; I think that that came to £50 million a year. I think that it is not so much the right of people to claim benefits if they pay taxes and contribute to the economy, as the fact that some people claim benefits when their children are not even resident, that upsets the British people, who, as the hon. Member for The Wrekin has said, are a very tolerant and understanding lot. However, they will not stand for abuse of the system, and people taking advantage of a system to which they have not contributed.
I accept the point made by the hon. Member for The Wrekin, whom I have known for many years, that there are jobs that are difficult to fill, such as fruit-picking—I cannot quite imagine him picking strawberries in Shropshire, but am trying to fix that in my mind—but the Romanian and Bulgarian communities in this country are making a contribution to the economy and paying tax, even though the majority of them are self-employed. We have 6,000 students; we have doctors, nurses, professionals and people in all walks of life. The hon. Gentleman need only go to certain parts of north and west London to see the contribution that those people make. Of course there are certain jobs that cannot be filled, but those people already contribute to the operation of the country.
One way in which we can deal with the issue is by beginning an effective dialogue with the Governments of Romania and Bulgaria. For some reason known only to the Home Secretary, for six months she resisted telling me whether she had ever visited Romania. Eventually, when she gave evidence last Thursday to the Home Affairs Committee, she admitted that she had not; it is all right—we shall not ask the Minister the same question tomorrow. I can suggest a way of dealing with the issue, with a friendly EU country with which we do business every day, and with which we want to keep friendly relations, not least because we have begun our negotiation process with countries such as Romania and Bulgaria to try to put a package towards the British people for the referendum that is going to come—and as the hon. Member for The Wrekin and other hon. Members know, I fully support a referendum on whether we stay in the EU or come out. It would be helpful if the Home Secretary or the Minister for Immigration would go to Bucharest or Sophia and speak to their opposite numbers to see what can be done to make the transition as smooth as possible, and find out the root causes of migration from those countries—and not just rely on a BBC poll, helpful though that is—and I am sure that “Newsnight” will present a good programme tonight—it is such personal contacts that are important. I hope that the Minister will take the opportunity to do that in the next few months.
The Home Affairs Committee is, as I have said, conducting an inquiry on the matter. We are also considering the effect of the European arrest warrant and the Government’s proposals. We tagged on a visit to Romania before our visit to Poland, and we shall produce a report, thanks to work done by the hon. Members for Hertsmere (Mr Clappison) and for Rochester and Strood (Mark Reckless), who have driven the issue in the Committee. We hope that we can come up with a balanced report that will take into consideration the views that have been expressed in the debate today, but also the views of outside groups, including the embassies and, indeed, Migration Watch UK.
Let us not lose sight of one important fact: we have good relations with Romania and Bulgaria. I pay tribute to the Romanian ambassador, Ion Jinga, and to Ambassador Konstantin Dimitrov, who throughout the debate have been balanced in what they have said. I pay tribute also to Martin Harris, our ambassador in Bucharest, who recently won an award for excellence in communication in the relationship between our two countries. What I have to say is directed not at hon. Members, who are not those responsible, but at those in other political parties not represented in Parliament, who put out election leaflets that are simply not true. Let us have a debate about the issue, and a report based on facts. More than anything else, let us have the estimates and predictions. It will make our task, at the beginning of next year, much easier.
Nicholas Soames (Mid Sussex) (Con)
It is a pleasure to serve under your chairmanship for the first time, Mr Walker. I hope that you and right hon. and hon. Members will forgive me, but I have to attend a Committee meeting later, so I will not be here for the conclusion of the debate.
I congratulate my hon. Friend the Member for The Wrekin (Mark Pritchard) on a first-class speech. I cannot say that I agreed with all of it, but I agreed with a great part of it, and he reflected well the grave concern that is felt outside this Chamber. I am sorry to say that I cannot follow the Chairman of the Home Affairs Committee, the right hon. Member for Leicester East (Keith Vaz). I think that we all remember the rather lowering period when he was a Minister at the Foreign Office. I agree with the general tenor of his approach, as to moderation, consulting and all the rest of it, but I think that the public are looking for a more robust approach to the matter than he offers.
I congratulate my hon. Friend the Minister for Immigration, who, as my hon. Friend the Member for The Wrekin said, has, together with the Home Secretary, pushed the debate forward and taken important steps. They have so far succeeded in driving down the numbers significantly. I am grateful to him for several meetings. He knows that is important for the credibility of government—not party Government but government of the country—that the Government should be seen to reflect the great concern about the question of immigration and the way it has been allowed to run riot. I agree with everything that my hon. Friend said about the debt that this country owes to immigrants, who have played, and will continue to play, an important role; but that is not what we are talking about today.
As my hon. Friend the Minister knows, there is a serious risk of a significant inflow of Romanian and Bulgarian immigrants. There is no shadow of doubt about it. The unbelievable cupidity and foolishness of the last Labour Government in not dealing with the matter beforehand is shaming to the Government of this country and shows how feeble they were. The problem lies, as they should have understood, in the huge difference in the standard of living between those countries and the United Kingdom. The reaction is an entirely understandable one to the opportunity to come. People will take that opportunity—I am not in any doubt about that.
There are two wild cards that have not been mentioned this afternoon. First, there are nearly 1 million Romanians and Bulgarians in Spain, and a similar number in Italy. There must be a serious risk that some will relocate to northern Europe—perhaps to Germany, France, the Netherlands or the United Kingdom. Secondly, there is the possibility that minorities who are heavily discriminated against in their own countries will seek a better life in the United Kingdom. That is most clearly a possibility in relation to the Roma.
There are no easy solutions. The cross-party group on balanced migration has suggested that consideration should be given to whether EU members should have powers, during periods of high unemployment, to restrict the free movement of labour, which is at present guaranteed by EU law. To me, that is one of the fundamental reforms that the European Union needs to look at without fear. If Europe is to survive as an entity, it must be able to move forward and break out of the silos in which it currently runs itself. It is folly not to consider that kind of suggestion: it may find very good reason to shoot it down, but it should look at it.
The role of the welfare state needs the most careful consideration. The payment of in-work benefits, such as tax credits, to low-paid workers contributes substantially to the financial incentive to migrate. There is again no doubt whatever about that. Access to the UK benefit system is primarily based on residence. An EU national who moves to the UK and is considered habitually resident has the same entitlement to benefits as a UK national, regardless of their previous tax or national insurance contributions. Currently, habitual residence is automatic for workers and the self-employed, and qualification is easy for jobseekers.
The cross-party group recommends that there should be a requirement of a period of time—or contributions—of, say, six months before in-work benefits are paid. On jobseekers, there seems to be no reason why EU citizens who do not find work should be entitled to benefits in the United Kingdom when they have the simple option of getting on a bus and going home. We should encourage that, perhaps even by going so far as to offer them a ticket. To implement those policies successfully the habitual residence test needs to be tightened and centrally administered by the Department for Work and Pensions.
Many other Members have more to say than me. I simply conclude by earnestly and truly congratulating the Minister and the Home Secretary on the progress made so far on this fiendishly difficult issue. One thing on which I most congratulate him is the very sane way in which he has approached the debate, making the point about the importance of keeping the vocabulary and language moderate and sensible. This is not a war; this is a national problem for this country that must be addressed. We will only be able to deal with it probably—possibly even—at the margins, but deal with it we must in a frank way, in the interests of our country.
Mr Philip Hollobone (Kettering) (Con)
It is a huge pleasure to serve under your chairmanship, Mr Walker. I congratulate my hon. Friend the Member for The Wrekin (Mark Pritchard) on securing the debate and on his excellent remarks. It is a huge privilege to follow my right hon. Friend the Member for Mid Sussex (Nicholas Soames). The one fault of his speech was that it was too short. He has led this House by supreme example through his chairmanship of the cross-party group on balanced migration.
Like my right hon. Friend, I believe that the population of our country should not be allowed to go above 70 million. We are presently at 62 million, and unless we get a grip on immigration we will end up with a population of more than 70 million in the 2030s or 2040s. If we think that Britain is full now, with all the transport, housing, schooling and health difficulties that we face, it will be far worse in 2035 or 2040 unless we tackle the issue now.
I want to make a plea on behalf of all of us who have raised the issue of immigration over many years. It was not until the start of large-scale immigration from the European Union that those of us concerned about immigration were not accused of being racist whenever the word “immigration” was used. For all of us who are concerned about immigration, it has never been about the colour of somebody’s skin or about the culture or country they come from; it has always been just about the numbers. Our country is one of the most crowded in the world, and we simply cannot cope with another large-scale wave of immigration into this country, especially from countries with which we have very little in common, such as Romania and Bulgaria.
Let me put my cards on the table straight away. I do not believe that Britain should any longer be a member of the European Union. We tied ourselves to the wrong club with a crisis of confidence in the 1960s and 1970s. Why on earth would we want to shackle ourselves to a trading bloc whose share of world trade was 30% in the 1980s, but is rapidly heading towards 15% in the 2020s? I do not believe in an ever-closer union.
Mr George Howarth (in the Chair)
Mr Hollobone had the floor, but before I bring him back, as it were, it might be worth mentioning, for the convenience of those present, that we will conclude this debate, with time added on for the Divisions, at around 7.55 pm, give or take a minute or two. I hope that that is helpful.
Mr Hollobone
It is a pleasure to serve under your chairmanship, Mr Howarth. I think that a few Members thought that they had escaped with the ringing of the bell—saved by the bell. My right hon. Friend the Member for Mid Sussex has escaped—he has heard me speak before—but, sadly, other hon. Members will have to endure part two.
I was telling hon. Members that I am no longer in favour of Britain’s being a member of the European Union. We are tying ourselves to a sclerotic trade bloc. We have to pay an annual membership fee of more than £10 billion and we have to open our borders to all and sundry. I do not believe that my constituents would be in favour of any of those three main conditions of our being a member of the EU. I do not take my constituents’ views for granted and I am delighted that the Conservative party has pledged a referendum on Britain’s membership of the EU, should we form the Government after the next election. Should I be back, I intend to hold the Conservative Government at that time to account on their election pledge. If my constituents vote to leave the EU, I will certainly join them. If they vote to remain in the EU, that is their choice and I am delighted that they will have that choice.
With regard to immigration from Romania and Bulgaria, this country cannot cope with a further wave of mass immigration. I do not believe in an ever-closer union in Europe or in the free movement of labour. Yes, we need skilled labour, whether from the EU or from around the world, but we should control that with a work permit or visa system. With our membership of the EU, effectively our borders are open to skilled and unskilled labour from across the EU. There are consequences and serious knock-on effects of large numbers of people coming to our country.
The right hon. Member for Leicester East (Keith Vaz) made a valid point in saying that Her Majesty’s Government needs to provide a sensible estimate of the numbers that might come from Romania and Bulgaria. It is sensible to start by seeing how many came to our shores from the A8 accession countries—the first wave of immigration from eastern Europe. We now have just over 1.1 million eastern Europeans from those A8 countries, which have a combined population of just under 73 million. That is a rate of 1.5%. That is a known—a fact—and it is indisputable. If we apply that same rate to the entry of Romania, with 21 million people, and Bulgaria with 7 million, the 155,000 from those two countries presently resident in the UK would climb to some 425,000. That means that we can, on average, expect three times more Romanians and Bulgarians than are currently resident in this country.
Those estimates tie in nicely with those from Migration Watch, a hugely respected, independent migration think-tank, which has estimated that the influx from Romania and Bulgaria will be between 30,000 a year, at the bottom end, to 70,000 a year at the top end, with a central estimate of 50,000 a year.
Mr Stewart Jackson (Peterborough) (Con)
I pay tribute to the excellent work that my hon. Friend has done on this issue over the past few years. Is not the problem that some of our policy makers do not understand the impact of these large demographic changes on a small number of geographical areas? My hon. Friend knows that in my constituency 34,000 national insurance numbers were issued in eight years, in a city of 150,000 people. Some 41% of primary school children in my constituency do not have English as a first language. This is the reality of mass migration from the European Union.
Mr Hollobone
I am most grateful for my hon. Friend’s helpful intervention. I praise the work that he does on behalf of his constituents in Peterborough. He has the courage to speak out on these often controversial issues on their behalf. Rightly, he does not mince his words. The situation in his constituency is intolerable. How have we let this happen? We will never have any sensible degree of integration if large numbers of immigrant communities are all in one place. One difficulty with such a large number of people all arriving at the same time is that they do not disperse across the country, but tend to congregate in concentrations, Peterborough being one. Any sensible management of public services, whether schools, hospitals or other local service provision, is difficult under those intolerable pressures.
Mr Andrew Turner (Isle of Wight) (Con)
My hon. Friend is attacking this from the wrong end. It is no good saying, “What happened in 1066? What happened in 2004?”, because what happened then should never have happened. We have to say to the Minister, “You are responsible. You must fix a limit and say, ‘That is the maximum that is allowed, and that is all.’” It does not matter how the rules are fiddled or used to make that happen, but happen it must.
Mr Hollobone
I do not think that my hon. Friend and I disagree. I was trying to say that the British public expect, as a minimum from their Government, some sensible estimate of the numbers coming from Romania and Bulgaria. Why would a country open its borders to two foreign countries when it has no idea how many people will come to our shores from those countries? All I am asking, as a starting point, is why do we not use what happened last time to work out our estimate? If we do that, we eventually end up with well over 400,000 Romanians and Bulgarians in this country. I hope I am wrong—I hope those numbers are a huge exaggeration—but the Government are not saying whether I am wrong or right; the Government have no view, and they refuse to take one. The British public expect rather more than that from Her Majesty’s Government.
I agree with my hon. Friend that we have to try to fix the problem, although I do not think it is a problem that can be fixed. We should say, “No, we are not going to have immigration from Romania and Bulgaria.” When the transitional controls end, we should say, “Sorry, we are not going to allow immigration from these two countries.” For those who want to remain in the EU but renegotiate our terms of membership, that would send a firm signal of intent that this country means business.
At the moment, I do not believe that the other EU countries believe we are serious in trying to renegotiate our membership. I feel renegotiation of our membership is doomed to failure. I do not believe the other EU countries will take us seriously—they are going to shuffle about for years and years to put off the day when any new treaty could be signed. We may well be in the same bind in five, six, seven or 10 years’ time. I think we should leave the EU, but for those who want to stay, a firm signal of intent that we mean business in renegotiating our membership would say to the Romanians and the Bulgarians, “We are sorry, but Britain is full and we will not take immigration from your two countries.”
There are very good reasons for saying no, not least crime levels. There is currently a crime wave of bag snatchers and pickpockets on London underground. I am a special constable with the British Transport police, so I know what I am talking about. Eight out of 10 pickpockets on the London underground are Romanian, and I would welcome an intervention from the Romanian ambassador to say, “We recognise that you have a problem here in London with crime levels from our nationals. We are going to try to help address that situation for you.”
Of course, London is a huge magnet. With 7.5 million residents, it is the largest city in western Europe, compared with 3.5 million in Berlin, 3.25 million in Madrid, 2.5 million in Rome and 2 million in Paris. London is one of the world’s most cosmopolitan cities, and with English as our native language, London is a magnet for millions of people throughout the EU. Romanians or Bulgarians looking for some of their fellow countrymen in the EU are most likely to find them here in London. London is a magnet that attracts people from those two countries.
The very least that Her Majesty’s Government should do is ensure that all European nationals who intend to come to our country and stay for more than three months have to have a residency card. Her Majesty’s Government are allowed to do that under the rules—this point has been put to the Immigration Minister previously, not least in the excellent private Member’s Bill introduced by my hon. Friend the Member for Peterborough (Mr Jackson), and I have also raised it with him directly on the Floor of the House—and other countries do it, not least Spain. That means those countries have a far better handle on the numbers of other EU nationals coming across their borders, and it would give us a far better handle on where EU nationals are coming from and where they are living in this country. It would also help us with issues such as benefit entitlement, access to services in the national health service, and school places.
Mark Pritchard
My hon. Friend is making a powerful case. Will he set out the difference between a residency card and an identity card? The Conservative party, along with others, objected to an identity card, which is a complex area with many political challenges and pitfalls.
Mr Hollobone
A residency card is not an identity card in that sense, but there would be a requirement for EU nationals coming to live here for more than three months to have one. The card would basically be a trail of documentation that tells us who those people are, where they have come from and where they are living in this country. At the moment, Her Majesty’s Government, as far as I can tell, have no idea which EU countries are sending the most people here and where they are living.
We also need to get a far better handle on EU nationals coming here with young children, because there is pressure on school places in both Kettering and Peterborough, probably in The Wrekin and certainly in our big cities. Unless we get a better handle on the type of people coming here and their economic requirements, our local councils and other services will not be able to provide the public services appropriate for their needs.
Mr David Ward (Bradford East) (LD)
My wife’s job is to find schools for children from the new arrival community. The question is not just about arriving; it is also about leaving. Is the hon. Gentleman aware, and does he agree, that the attraction for many new arrivals, who live pretty poor lives here, is that it is far better here than in their own countries, particularly for the Roma community because of the blatantly racist behaviour of other members of the European Community towards their own Roma communities?
Mr Hollobone
Yes. The hon. Gentleman makes a good point, and I congratulate his wife on the work she does.
That leads to another difficulty, because hon. Members have spoken about the habitual residency test. People can now come to this country from another EU country, claim to be self-employed and automatically get themselves on the benefit entitlement list. The idea that EU nationals are excluded from benefits until they have made a certain level of contributions over a certain period of time is simply not the case. The Roma community from Bulgaria and Romania has accessed that loophole, which makes British people extremely cross, as does giving child benefit to families whose children remain in their country of origin. That problem will be exacerbated when Romania and Bulgaria join.
If we are to stay in the European Union, which I do not favour, the very least that should be done on benefit entitlement is to introduce a reciprocal arrangement so that people who come to this country from another EU nation state are entitled to claim only the level of benefit they would have obtained in their country of origin. That would act as a big disincentive to benefit tourists, who come to us because of our relatively generous benefits system. One of the reasons why such immigration from EU nation states has become more of a problem as the EU has expanded is that the EU has been expanding into countries that are far, far poorer than our own. National income levels in Romania and Bulgaria are only about a fifth of the United Kingdom’s level, so there is a huge economic incentive, especially for young people, to come to this country.
Mr Ward
I want to correct that point, because people do not receive full entitlement to all benefits as soon as they arrive. They are obviously not entitled to income-related benefits until they have an income record, although what the hon. Gentleman says about child benefit is true. The growing number of Roma in particular who are now accessing the increasing number of food banks in Bradford is testament to the fact that they do not have full entitlement to all benefits when they arrive.
Mr Hollobone
That is right, but my constituents would say, “Why should someone from another EU nation state arrive in this country and claim anything unless they have some kind of contribution record over a sensible period of time?” That is what makes people so cross.
My hon. Friend the Member for The Wrekin was right to highlight the fact that we have a national health service, not an international health service. I very much hope that, in the list of legislation in the Queen’s Speech, there will be a Bill—it would be fairly simple—to require GPs and NHS trusts to ensure that documentation is checked when someone presents themselves for treatment. We are not saying, “Do not treat other EU nationals or nationals from outside of the EU.” Of course we should treat them; we are just saying, “That treatment needs to be paid for, either by their own Governments or by their own insurance scheme.” That is the issue. We cannot go on treating the world, as my hon. Friend rightly said.
It is not often mentioned that we are not only talking about Romania and Bulgaria; we are also talking about other nations in eastern Europe that can access Romanian and Bulgarian passports through grandparent rights. Hundreds of thousands of Moldovans are signing up to get Romanian passports so that they can take advantage of the end of transitional controls at the end of 2013. We can bet that those people will also be coming towards London.
The issue is serious and I congratulate all those who signed the e-petition and helped secure this debate in Parliament. We cannot, in my view and that of my constituents, carry on like this. In the words of the Under-Secretary of State for Communities and Local Government, my hon. Friend the Member for Grantham and Stamford (Nick Boles):
“The fact is, 43% of the new households which want a home, is accounted for by immigration.”
That is before we open our doors to Romanians and Bulgarians. Constituencies such as mine are seeing green fields being built over, schools full to the brim and health services stretched to the limit. Our country is full and we will not put up with it for too much longer.
Kris Hopkins (Keighley) (Con)
I congratulate my hon. Friend the Member for The Wrekin (Mark Pritchard) on securing the debate. As he said, it is extremely important that we have these debates. For too long— this is particularly true of my party—we have avoided contributing to the immigration debate. There is some history with previous rhetoric and we disengaged from the subject. Making a measured and meaningful contribution to it, by offering a range of views on the issues that my hon. Friend raised, is important.
Nick Griffin, the British National party leader, stood in my seat of Keighley in 2005 and more than 5,000 people voted for him. In the same period, four councillors representing the BNP were elected. I have no doubt that immigration was one of the reasons why those people secured so many votes. It was a failure not only of the previous Government, to whom I will come in a minute, but of our party to challenge what was going on and to participate in the debate.
One of my previous roles was leader of Bradford council. The district owes much of its historic wealth to its migrant populace, which includes a huge German population, a huge Irish community and a massive east European community, as well as the Pakistani community that is dominant now. Each of those component migrant groups brought an immense wealth to our great city and district. One area is called Little Germany because of the huge work and wealth that the German migrant community and traders brought in. It has the finest architecture in the district. Although it is important that we have a conversation about migration and immigration, it is also important to contextualise some of the positive economic reasons why we need a balanced migration policy.
I will give the political response. When I was knocking on doors in my constituency before the general election, I saw a lack of confidence in our border controls. Many felt absolute despair that the previous Government had lost control of inward migration and could not even quantify the number of people coming in, which led to far right parties gaining more support. That was why it was important that I, as a more centrist member of the Conservative party, engaged with the issue. People wanted to hear sensible mainstream parties engaging.
I do not think the electorate sit there and try to differentiate between EU and non-EU. They see it as a migrant issue that we need to address. The Prime Minister spoke earlier this year about a cross-Government immigration system, and he picked up on a couple of issues. He talked about stopping a benefits system that people perceived as a soft touch and ensuring that the entitlement to public services was something that migrants earned, rather than had an absolute right to straight away, which is important. He also talked about cracking down on illegal working, and there was a significant amount of that in the district I represented. There is a grey economy that is unchecked and needs to be challenged.
As a consequence of the Conservative-led coalition, immigration has been checked and reduced by a third. That is a huge figure that will give many of my constituents confidence that we take the issue seriously. We are beginning to take control of migration and we are, with some more structural challenges, challenging the border control agency as well. The other points that the Prime Minister made were about cutting benefits for non-EU nationals after six months, which is important, and stopping the “something for nothing” social housing access.
My hon. Friend the Member for Cities of London and Westminster (Mark Field) commented on health tourism, which we need to address. We get a significant number of people coming to our district with genuine health problems, and there is an issue with repeat prescriptions and people sending them back home. We need to understand and challenge that and, if we are going to offer that service, we need to charge for it, as other hon. Members have said. There is an issue that health professionals need to debate, because when someone arrives unconscious at A and E, they are not going to check their passport to see whether the person is eligible to be cared for. I would not want a system that did not ensure that people with that need were cared for first, before we started talking about their nationality.
We have robust and thoughtful immigration controls and management in this country. The politics of immigration should be led by the mainstream parties, not left to the far right.
Mr George Howarth (in the Chair)
Order. If the hon. Gentleman is making a general speech about immigration, he needs to relate it to the specific subject under debate, which is immigration from Bulgaria and Romania.
Kris Hopkins
Thank you, Mr Howarth. The next paragraph comes on to that very issue.
I am concerned that the Government manage the controls and the arrivals from Bulgaria and Romania. I am sure that the Minister will explain some of the interventions that he will put in place and give confidence to those who are worried. It is about managing expectations, not only of those in this country, but of those who may travel here.
My right hon. Friend the Member for Mid Sussex (Nicholas Soames) talked about the tone of these debates, which is important. There is a danger that the tone of the immigration debate, in particular on Romania and Bulgaria, will become increasingly ratcheted up in a race for crescendo, for the ideal hard-line rhetoric associated with immigration, but that would be self-defeating and, if we are not careful, it will play to the advantage of the far right. We want the right language and tone—as mentioned: factual arguments and a measured debate. People need to see that action is being delivered, that the control measures have been put in place and that we have managed borders. I believe that the Government are on the right track to addressing the many issues that Labour failed to address.
Chris Heaton-Harris (Daventry) (Con)
It is a pleasure to serve under your chairmanship, Mr Howarth, and to speak in the debate. I congratulate my hon. Friend the Member for The Wrekin (Mark Pritchard) on securing it and allowing us to have what has been a well tempered and well argued debate on possibly the most important subject of the day.
I speak as someone who quite likes the multicultural nature of Great Britain and who has benefited from it in many ways in my previous life outside this place and then as a Member of the European Parliament, when I came to experience and know some of the wonderful institutions with which the Minister now deals regularly to solve the problem we have. Immigration is probably the thorniest political issue of our time, if not of all time. We only need to look at the United States of America to see Republicans and Democrats working on a solution to how they can deal with those people in the United States who should not be there, whether with an amnesty process or whatever. It is a tough topic across the globe.
The Government are beginning to get some things right, with net migration down a third since May 2010. In June 2011, the number of people coming in was 247,000 to 250,000, but in June 2012, 163,000—a fall of a third, welcome to my constituents. It is also interesting to see where immigration comes from: pre 31 December this year, 55% consists of nationals from outside the European economic area, 30% EU nationals and 15% Brits returning from abroad, where the sun on the costas might not be as nice as it used to be, with other issues elsewhere. The net migration statistics are welcome because they show that the Government are looking at immigration seriously—the first time in a long time for a British Government. I come with some heart to the debate, therefore, because the Minister completely understands that my constituents and those of all right hon. and hon. Members who have spoken before me, on either side of the political divide, are truly concerned about what might happen after 31 December this year with potential migration from Romania and Bulgaria.
When I knock on the door of a constituent, the first thing that he or she has to say to me when I ask about their concerns is, “I am not a racist but”, and I hate that, because such people have genuine concerns about what their country looks like and how it feels. They are not racist at all and welcome the fact, as I do, that we have a much more multicultural Britain nowadays than we did before. Nevertheless, they feel that a big issue is coming down the line: Romanian and Bulgarian migration. We are talking not about the stuff, discussed by my hon. Friend the Member for Keighley (Kris Hopkins), that the far right is trying to engender—I saw leaflets circulated during the county council elections that were unpleasant to say the least, as well as factually impossible or incorrect—but about concerns in relation to all sorts of things, public services being among the main ones.
Some members of the Public Accounts Committee are present, and not so long ago a number of us went on a Committee visit to our Chair’s constituency in Barking. We were examining pressure on primary school places, and we went to the fantastic Gascoigne primary school—now the largest in the country, they believe—where a huge number of languages is spoken, some of which I have never heard of. The school is situated beside the Gascoigne estate, which includes a number—nine, I think—of large, horrible tower blocks, which were due to be taken down not so long ago. If someone migrates to this country, legally or otherwise, or crosses the border and registers with the authorities, one of the places that they will put people—most of whom come to London to start with, which is completely understandable—is the Gascoigne estate. The Gascoigne primary school, therefore, has at least eight to 10 pupils coming in new and eight to 10 pupils leaving every week throughout the school year, according to the head teacher, an excellent gentleman; one class last year had an 82% turnover in pupils.
Dealing with such a flow is difficult for any teaching establishment, and in the Gascoigne school it was all down to migration, some of which is good, with people coming to this country to work as hard as they can. The current pressure on our public services in general, however—on that school, or the hospitals around it—cannot be overestimated, and my constituents are concerned that, as of 1 January next year, the pressures on our public services will get greater and we need to plan for that. We cannot blame people—anyone—for wanting to come to this fantastic country of ours to work, to study or to do anything, because it is a wonderful place to do all those things. If I were in the situation of a Bulgarian person struggling to find work in my home country and with mouths to feed, I would absolutely up sticks and try to find work elsewhere. We cannot blame individuals for doing that, but we need a policy whereby it is slightly more difficult for mass migration to take place in future circumstances.
We should therefore look at how to predict better because, as many Members have said, we have some issues on numbers. The Minister has formed a cross-departmental committee to look at that and some of the other issues mentioned in the debate, and I would like to hear how that committee is going. As we have recognised in our contributions so far, the subject is of interest not only to people interested in Europe or in the wonderful Home Department but for its effect on education, the health service, transport networks and the whole works. I would like to hear from the Minister what we are doing with what he described as the “pull factors” for people coming to the United Kingdom.
I understand that benefits available to EU migrants in the UK are being compared with migrant benefits in other EU member states. EU law requires that people who move from one member state to another, with a right of residence in the host state, should not be discriminated against in their access to benefits simply on the basis of nationality. The provisions of EU law, however, do not harmonise the rules governing entitlement to each type of benefit throughout the member states. Anyone who has travelled in the EU knows that each individual country has different types of benefit: some have generous out-of-work benefits, some limited ones. Reciprocal arrangements are agreed, therefore—probably across the political divide—but the type of benefit is not agreed.
Chris Bryant
I think the biggest difference that matters legally in the EU is whether a benefit is contributory or non-contributory. If it is non-contributory, everyone—Belgian, French, Romanian and so on—must be treated exactly the same as a Brit, but if it is contributory, different British people are treated differently. My worry is that the UK is moving further down a route towards non-contributory benefits which might have significant financial implications for us in relation to other countries.
Chris Heaton-Harris
I welcome the hon. Gentleman’s intervention, and I understand exactly what he is saying. I was coming to the specific point about contributory benefits. In the United Kingdom, most people’s worries, founded or unfounded, are that a group of people will head here and, without contributing anything to our society, take a lot from it. Everyone is trying to articulate those fears as generously as possible, and I know that the Minister understands them. To fix the issue beyond doubt, we need to change the way this country gives benefits in general. That is a bigger debate than today’s, but we must head more down the contributory route. That will cause political issues elsewhere across the political spectrum, but if we stay within EU rules and deal with the potential problem of migration from Romania and Bulgaria, the basis of contributory benefits and enlarging that portfolio is one solution.
Mr Ward
I want to add a note of balance. I came to the London marathon to watch my son run, and it was difficult in bars and restaurants, on public transport and everywhere I went to find anyone serving me or working in those establishments whom I believed was born in this country. Much immigration is about not benefits but employment, and we should remember that.
Chris Heaton-Harris
When we talk to people on the doorstep, as I am sure the hon. Gentleman does regularly, they generally say that they do not mind people coming to this country to work, but that they worry about those who might choose to come here not to work.
The last Labour Government made some fundamental mistakes with reciprocal benefits back in 2004-05. As a Member of the European Parliament, I corresponded with a then Minister, the hon. Member for Hackney South and Shoreditch (Meg Hillier). A constituent had written to me asking exactly the question that an hon. Member here raised earlier about the number of children for whom child benefit is available but who are not resident in this country even when the parent is working here. The hon. Lady wrote back in her forthright way saying that that should not be a matter of concern, that it would not happen often, and that the checks to find out how many children are living abroad are expensive so the Government were just going to hand out money to those who claimed. That fundamentally upsets fair-natured taxpayers in this country, and I am sure that the Government can do something about it.
We want to maintain fairness in the system. I do not want to knock on doors in my constituency and hear people say, “I am not a racist, but.” They are absolutely not, and they are genuinely worried about the future look, feel and wealth of their country. They understand that globalisation has altered the state of many countries throughout the world and that migration of workers is common and generally welcome.
I want to raise one final point with the Minister about the freedom of movement changes for Romanians and Bulgarians on 31 December. I am wary of those who police this, not as in Governments, but as in lofty EU commissionaire types who look down on European countries and think that everything is going fantastically well and everyone can police everything adequately so third-country access to the European Union can be loosened or extended. I know that the Minister is well aware of the draft EU directive on entry and residence of third-country nationals which is coming down the line. The Government have some issues with that. We do not participate in the previous directives that it is changing, but it will expand the base of third-country nationals who can come to the European Union as volunteers, au pairs and so on.
My worry is that more people will come into the European Union—not our part of it, but the EU in general—where unemployment is already high and displace people from other EU countries. If we have not sorted out our benefits system and the changes that many hon. Members have referred to today, one place where they will want to come if they are displaced from work by future expansion of the EU work force by third-country nationals might be the United Kingdom. I hope that the Minister will engage in those negotiations. They do not concern us de facto, but they do concern us greatly.
I again congratulate my hon. Friend the Member for The Wrekin. There is so much we could and should learn from the past. The last Government, unbelievably, whether it had a report or not, did not know how many people might head to this country following European accession. We should learn from that, and we should try to put numbers on that. Government predictions are constantly wrong and, rather like predicting the weather, no one can do it properly from day to day. A long-term prediction of the number of people who might come to this country without knowing the economic circumstances of where they are coming from, where they travel through or where they are coming to must be very difficult, but other organisations do that. The European Commission presents statistics and we have heard that Migration Watch has provided some numbers. It would be good to be able to make correct decisions, based on numbers that some people have confidence in, about how we can deal proportionately with any problems coming forward.
Stephen Barclay (North East Cambridgeshire) (Con)
The petition that generated such a response focused on the desire to extend for a further five years the restrictions in place. I very much support that objective while recognising the constraints in European law and the realpolitik of renegotiation that applies to the discussions held by the Minister.
My right hon. Friend the Member for Mid Sussex (Nicholas Soames) spoke for many when he referred to the great concern and the need for a more muscular and robust response. My hon. Friend the Member for Peterborough (Mr Jackson) gave a good example of the sheer scale of new national insurance numbers that are being applied. I represent the adjacent constituency in the fens, and can attest to the pace and scale of migration that he highlighted and how that was not mirrored in census data or the funding formula under the previous or current Governments to address school funding for those for whom English is a second language. That backdrop frames our debate today and generates the concern that has led many to sign the petition.
I also recognise that in those renegotiations we need to be cognisant of the fact that many British people are benefiting from the rules allowing them to work elsewhere in Europe—even though that is not, in most cases, in Bulgaria and Romania—and that often, welfare reform issues are mixed up with immigration issues. Many in the farming community rely on seasonal workers and say that without them, the rural economy would suffer seriously. In other areas and in other debates, we need to address why such businesses are so reliant on labour from elsewhere in the EU at a time when others are not working. Sometimes we conflate different issues within the subject matter of the petition being signed.
The underlying concern behind the petition is one that I very much share, but I would like to broaden the discussion a little. Today’s debate has focused very much on low-skilled workers, but the difficulties with the free movement of labour and the automatic right to work are not confined to such workers. For example, it was in my constituency that David Gray was unlawfully killed by Dr Ubani, an EU-qualified doctor who could not speak English. He gave Mr Gray an overdose that killed him, and yet, as a doctor, he had the automatic right to work in the UK without passing any language test. For five years, we have been told that we can do nothing about that loophole, as the General Medical Council now calls it, because of EU law. When I raised the matter after being elected to the House—one of the first things that I did was campaign on the issue—I was constantly told that nothing could be done because of EU law, even though the French managed to have a workable system that generated language tests.
I simply highlight that case because I welcome the fact that the Government are fixing the problem, but also because it illustrates that the issue is not only confined to low-skilled workers. It is not just low-skilled workers who will come from Bulgaria and Romania. Where there are issues, for example, with doctors and their ability to speak English, those should be addressed. That case also highlights the risk-averse nature of much of the legal advice one often receives from Whitehall, which says to Ministers, “We cannot do things”. That is not a true representation of what EU law allows. It does allow the more robust approach that my right hon. Friend the Member for Mid Sussex spoke about.
Mark Pritchard
My hon. Friend raises an important point on the principle of always testing, because however expert the legal advice that is given by Government lawyers, it should always be tested and re-tested. He also makes an important point about those with higher skills. He may or may not be aware that, for example, veterinary surgeons coming into this country—of whom there are many from the EU—are not required to take an oral or written English test, and the same problems that he has highlighted arise with some of those vets.
Stephen Barclay
I thank my hon. Friend for that intervention. In terms of veterinary science, I was not aware of that pertinent point. Of course, all Members welcome people with skills joining the UK economy and the benefits that they bring, but the specific point is about the speed with which officials are willing to react to the regulatory risks that arise—whether from a vet, a doctor or from others—and their willingness as part of the renegotiation to take on some of the sacred cows of EU law and what it is alleged that treaties require us to do.
I put on record my thanks to the Minister for the specific action that he is taking on the pull factors. A tremendous amount of work, on which he is leading, is being undertaken across Departments, and it is particularly important. The issue is often discussed through the prism of the British perspective. In common with my hon. Friend the Member for Daventry (Chris Heaton-Harris), as a member of the Public Accounts Committee, I am concerned about the impact that much of that inward migration has on taxpayers—a burden is placed on the taxpayer, on our benefits system, or on our NHS, particularly from those who have not contributed.
The other reason why I think the Government’s action on pull factors is so important is that, often, the most vulnerable people in the community that I represent have been misled—they have been mis-sold too. A ruse that operates in an area such as Wisbech involves people being promised a job and accommodation if they come and work in the farming community. When they arrive, the gangmasters, who are often illegal, say, “This week, we only have work for two days, and next week, we only have work for three days. The week after, we only have one day.” What modest savings people might have are exhausted very quickly. The gangmasters will then lend them money, because it is very difficult for someone who perhaps has borrowed money from family members to face the embarrassment or even the immediate financial difficulty of going home. Therefore, these illegal gangmasters get people into the UK on a false promise, then abuse them by getting them into debt, and from there, they have control—“You must buy our counterfeit goods. You must come in the minibus and pay a high daily fee.”
What is scandalous is that many of the most vulnerable people in our community are affected. They are not voters, nor are they visible, and often, where they are subject to crime, it is not reported, so the police then have difficulty, saying “Should we take action and fund work on this? It is not reported crime.” I note that the Chair of the Home Affairs Committee is here, and I hope that he and his Committee might address the issue of known crime that is not reported and is affecting many of the most vulnerable, and how resources are used, because that is a tension in itself.
The pull factors are bringing people here who are then being abused. The debate is focused through a British prism—travelling to Bulgaria and Romania and telling people that they should not come here because they will not be eligible for some of the benefits that they think they might be is very much about defending the taxpayer. It is right and proper that we do that, but I put the case that such intervention is often in the interests of those who might be persuaded to come here, because they are misled into doing so and then are subject to the illegal gangmasters who abuse the process.
Although we welcome tighter action and controls within the scope of the law—I commend the Minister’s work on the pull factors—the main thrust of my remarks relates to those who are here. In a sense, that may be slightly counter-intuitive, because the Bulgarians and Romanians are not yet here, but we know that they will be. If one looks at what has happened so far, there has been a failure across agencies to take action on the abuses to which people are subject once they are here.
For that reason, I have been working closely, as the Minister will be aware, with the Home Secretary and Her Majesty’s Revenue and Customs on the multi-agency task force that we have now set up in the fens. The issues apply not only to Wisbech, which I represent, but to Boston and Peterborough, where my hon. Friend the Member for Peterborough faces such problems, and to Spalding, King’s Lynn and other places across the fens. The issues are so often seen as urban, as city issues, when the concentration in certain rural communities is out of scale and out of proportion with the communities that are absorbing them. The work of the multi-agency task force is extremely important. It is at an early stage—I ask the Minister to meet me in a couple of months for us to review progress—but I would like to draw three specific points to his attention and that of Chamber.
The first relates to houses in multiple occupation. The automatic registering of HMOs only applies if there are three storeys. That may be an issue in London, but in the fens, most of the accommodation is not on three storeys. In one example, 22 people were living in a bungalow. The census just does not reflect that, and that then feeds into many of the issues about antisocial behaviour, because if lots of people are living in one house, where do they go? They tend to go and have a drink on the street. That upsets neighbours. It creates problems such as that of urinating in public places. It just is intimidating to many people to see gangs of people, even if they are acting lawfully.
In my view, there has been a failure by agencies to take on the issue of houses in multiple occupation. There has been a licence system more recently in Peterborough. We do not still have one in fenland; I believe that we should. This is not just an issue for London and other cities; it is an issue that is acute in North East Cambridgeshire, and the sums of money involved are not inconsiderable. Some hon. Members might think that the more people there are in a house, the less the landlord will get, but that is not the case. The going rate in Wisbech is £50 per person; the more they have in, the more they get.
Sometimes the landlord does not even know what is happening. Sometimes the landlord has rented the house to a couple of people and is living away and is not aware that it is being used as an HMO. Some of the letting agencies are breaking the law, because they are under a duty to conduct a review every six months, but they do not do so; and again, officials tend not to act. There is also an abuse in relation to council tax. There is an abuse in relation to the tax on that revenue that is being paid. However, Government tend to see this as a rural issue. It is a bit too far from the desks in Whitehall. There are not too many national journalists reporting it.
Mr George Howarth (in the Chair)
Order. The hon. Gentleman is making a very interesting point and making it very fluently, but perhaps he could relate it back to Bulgaria and Romania.
Stephen Barclay
Mr Howarth, you bring me on to the crux of the point. We already have a concentration of HMOs in Wisbech and the fens. That situation will only become more acute when Bulgarian and Romanian people come into those areas. We know that there is already a concentration within certain communities that are ill equipped to deal with it. I welcome what the Minister is doing to try to prevent people from coming in and to persuade, in relation to the pull factors, those who are coming in with, perhaps, a misguided view. I would love him to be 100% successful, but we know that despite his best efforts there will be an inflow of people from those countries and we are still not taking action on the problem that is here now, so let us get on with it. Let us attack it now in order to ease the pressure when those from Bulgaria and Romania come in.
I come now to my second point. Many people from Bulgaria and Romania will come in with vehicles that are registered in their country. Under the law, they have six months in which they can drive on our roads before the vehicles have to be registered. The House may not be aware of how many people were prosecuted last year for not registering their vehicle after six months. It was zero—not one. The Government seem to be under the impression—I note this for the Chair of the Home Affairs Committee—that every single person from eastern Europe who came in under the previous accession registered their vehicle after six months and not one of them continued to drive on the roads without doing that. Surgery cases that frequently come before me suggest that that might not be the case in my constituency, and logic would suggest that it is not the case. My point is this. There are constraints on what we can do under EU law and what we can renegotiate, but in terms of Bulgarians and Romanians coming into the country, we can at least show their neighbours, the British people, that the laws have been applied equally to them, because if my constituents have to MOT, license and insure their car but they see a rickety vehicle that does not look roadworthy and that they strongly suspect is not registered and they see a Government who never take action to prosecute someone for that, that feeds into the sense of grievance that all are not being treated equally. That is an issue that the Government need to tackle ahead of further migration from Bulgaria and Romania. It is not a big point, but I make it for illustrative purposes.
Mr Hollobone
I congratulate my hon. Friend on raising that point. I think that actually it is a big point and it is one that I have raised myself on the Floor of the House. We are potentially talking about tens of thousands of vehicles on our roads illegally. The purpose of the rules is to ensure that a vehicle is taxed, insured and roadworthy so that the driver can be prosecuted for any speeding or parking offences. All the rest of us have to comply with them. It is quite clear that tens of thousands of EU nationals are getting away with it.
Stephen Barclay
I thank my hon. Friend for that intervention. I have raised the point repeatedly with Ministers; I certainly was not trying to belittle it. The point that I was trying to make was that where we have legal powers already, to what extent are we using them? Are we using them to the full? My hon. Friend is right: the estimate that I saw suggested that there are about 15,000 illegal vehicles currently on the road. That has implications if they are in an accident; are they traceable? There is a lost economy issue. Our garages would be getting business from MOT-ing them. The insurers would be generating revenue from them. I make the point for illustrative purposes: it raises a wider point about unfairness within a community, which is not conducive to cohesion.
Stephen Barclay
I thank the right hon. Gentleman for the opportunity to clarify my remarks. It is a wider point. If someone brings a vehicle into the United Kingdom from the European Union, they can drive it for six months without it being licensed in the United Kingdom, but after six months it has to be licensed. The difficulty is that the police will say, “We don’t know when the six months started,” yet in the case of a British driver taking their car to Spain, where the same law applies, the burden is on them to prove when the six months started—for example, by showing their tickets for the ferry when they took it across. Again, there is no ownership of the issue, it seems. That is why I think that action is needed.
My third example is one that I have been in discussion with HMRC about, but again it will apply to Bulgaria and Romania when people from those countries migrate. I am referring to counterfeit goods. Often within the migrant community, there is great pressure on those who have come into the country and are in the low-skilled jobs to take, as part of a bundled package of services, counterfeit goods. Again, I think that there has been a tendency in Government to see that as pretty low-level crime, but it is not; it is quite serious. Often there are health consequences from the vodka and other products, such as cigarettes, that are being sold, but also there is a revenue issue. With that in mind, I very much welcome the multi-agency taskforce that the Minister and his colleague the Home Secretary have set up.
In conclusion, I welcome what the Minister and his colleagues are doing in terms of renegotiation. I think that we need to take all the action that we can, although I recognise that there are constraints. There is significant success in his work on the pull factors. I think that there is a cross-Government desire to grip that issue—that is clear—but I urge him to look, in relation to those who are already here, at whether we are using the full range of our legal powers and to demonstrate that ahead of 2014, so that when we do have people coming in from Bulgaria and Romania, we are on the front foot and not simply making existing problems worse by increasing their size.
Mr Stewart Jackson (Peterborough) (Con)
Thank you, Mr Howarth, for allowing me to speak. I apologise for not being present for the whole debate: I have been on other House duties. It is a great pleasure to be able to contribute to this very important debate. I thank a number of people, but principally my hon. Friend the Member for The Wrekin (Mark Pritchard) for his courage in taking forward this issue, which has sometimes proved very contentious and difficult to ventilate in the public sphere. I also pay tribute to my hon. Friend the Member for Kettering (Mr Hollobone), who has been stalwart and very persistent in taking forward these issues on behalf of his constituents. I reiterate the points raised by my constituency neighbour, my hon. Friend the Member for North East Cambridgeshire (Stephen Barclay), who sees many of the same issues as I do.
I feel in some ways that I have been a voice crying in the wilderness since 2004. I have been the Member of Parliament for Peterborough since 2005 and I have seen the impact of unplanned and unrestricted migration. Let me say at the outset that I defer to no one in my admiration of people who come from eastern Europe to make a better life for themselves and their families. I had the privilege of serving for eight years in the London borough of Ealing, from 1990 to 1998, which has the largest Polish population in the UK. Polish people are decent, hardworking and diligent; I have no problems with people based on their ethnicity, race, culture or religion, as my hon. Friend the Member for Kettering said. However, I have a problem with unplanned immigration from eastern European countries, the next iteration of which will be from Romania and Bulgaria from 1 January next year.
I deeply regret the catastrophic decision of the previous Labour Government to opt out of the moratorium on the free movement directive from 2004. I can understand in some respects why the decision was taken—the country at that stage was doing well, albeit fuelled by a particular credit boom—but more should have been considered and taken into account, such as the likely impact on not only the labour market, but welfare and dependency. It pushed young people, particularly men, who could have had the jobs that were taken by others, into welfare dependency and unemployment. It was an error of judgment, and the right hon. Member for Morley and Outwood (Ed Balls), to give him his due, and others have shown some contrition.
In approximately eight years, 34,500 national insurance numbers have been granted in the Peterborough local authority area, a city that in 2001 had a population of 156,000. We can imagine the impact that has had. To pick up on a minor aspect of the contribution of my hon. Friend the Member for North East Cambridgeshire, that has had a huge impact on the residential amenity of neighbourhoods in central Peterborough. Too many landlords, who should know better—grasping, greedy landlords, who do not care about those neighbourhoods or the people who have hitherto lived there—have put too many people into substandard accommodation, to the extent that Peterborough had to apply for extra funding to combat what they call “beds in sheds”. Whole neighbourhoods have changed overnight. We are very fortunate that we are a tolerant, decent and public-spirited people in Peterborough and Cambridgeshire; the British National party and other extremists have not prospered in that time and we have been largely welcoming, but there is a limit to people’s hospitality, as my hon. Friend the Member for Kettering said.
Fulbridge primary school in the centre of Peterborough is the second largest primary school in England with between 700 and 800 children. It is fortunate to be led by Iain Erskine—a fantastic head. More than 90 languages are spoken by the children. In my constituency, 41% of primary school pupils do not speak English as their first language. In itself, that is not a problem, but the churn is. Twenty-five per cent. of primary school pupils are not at the school at the beginning of term and 25% are not there at the end. Imagine the impact that that has on resource allocation, teaching time, educational attainment and standard assessment tests, and we can see why Peterborough is now in the bottom eight or 10 local education authorities in England, when, based on its demographic profile, there is no reason for that to be the case.
There are also concerns about health care. Our maternity services are under enormous strain, not least because the people who have come to Peterborough from eastern Europe are disproportionately young and therefore likely to have children, which is why we also have issues in schools. There are issues not only with eastern European people—Bulgarians and Romanians—but because a perfect storm of demographic and social factors have coincided. Due to the previous Government’s regional spatial strategy, which has continued, we have plans for organic growth in housing of 26,000 homes in approximately 15 years. My constituency and the city of Peterborough also has a large Pakistani-heritage community, the families of which are more likely to have larger numbers of children.
Mr Jackson
The hon. Gentleman makes a pertinent and sensible point—that is exactly the case. We have worked with local authorities, such as Westminster, Telford and Wrekin, the London borough of Barking and Dagenham and others, and argued for some time that the measurement of population is too prescriptive, too opaque and does not take into account the speed of change in housing tenure and primary and secondary schools, or crime, policing and health, including additions to GP and primary care registers.
That is the background to where we are. I feel a sense of disappointment, not with the Minister, who is competent and capable, but with the lack of preparedness and the lack of an imperative from the Government to tackle the issue. They knew that it would be important to co-ordinate a policy around immigration upon their election in May 2010, yet there is a feeling that they are playing catch-up, chasing their tail and responding to the media or some Back Benchers. It is disappointing.
As hon. Members know, on 31 October 2012 I introduced a ten-minute rule Bill entitled the European Union Free Movement Directive 2004 (Disapplication) Bill. It received a Second Reading, but it has disappeared, as we know often happens, into the ether. Denis MacShane, in his swan song, was the only person who opposed it, with a passionate speech. Only he would have the chutzpah, the day before the Standards and Privileges Committee published its report, to oppose a Bill that was largely supported. I shall not digress, Mr Howarth. The Bill referred to Bulgaria and Romania and said that that the Government do not need to gold-plate the free movement directive. There is sufficient flexibility in respect of Romania and Bulgaria for us to invoke the key parts of the directive, such as public good, public safety, public health and the habitual residence test. We could do what Spain has done, as has been mentioned, and have a registration regime when someone arrives, when they get married, and when they change address or jobs. Those are methods of reducing the pull factor.
It would be churlish and ungrateful of me not to concede that the Government have acted. I thank the Minister for his letter of 9 April, in which he comprehensively outlines the Prime Minister’s and Home Secretary’s intentions for welfare, housing and health. However, I must say that I do not believe that the Home Office officials advising the Minister have looked sufficiently robustly at what we need to do to reassure our constituents that what they see as unfair will not come to pass from January next year. We have a lot more to do on the habitual residence test. We must start collecting the data on how much child tax credit is being remitted to Lithuania, Poland and the Czech Republic.
Stephen Barclay
I thank my hon. Friend for giving way and for the work that he is doing on behalf of not only Peterborough, but the fen region. He repeatedly highlights issues that are pertinent to not only one constituency, but several. With regard to the specific point he is making, would he explore with the Government whether they have had discussions with the British Bankers Association on whether banks are able to track transfers from accounts in the UK to specific countries? In my former career, I worked in financial crime prevention, transaction monitoring and such areas, and I would have thought that Whitehall does not need to struggle with this, because the capability is already there. People can, in fact, track such flows. The information should be available through a quick phone call.
Mr Jackson
My hon. Friend tempts me down a path that might get me into trouble with the Chairman, but he has put that important and pertinent point on the record.
We do not need to speculate and look into the crystal ball; we know what happened. In 2004, the London School of Economics put together a research paper, which the hon. Member for Rhondda (Chris Bryant) tells us was 85 pages long. The Government seem to have disregarded the paper and to have allowed the media to speculate that the number that would come to this country would be between 13,000 and 15,000, whereas we know that it was well over 1.1 million.
My final point is that we must have a fact-based empirical analysis of how likely we are to have the numbers on which Migration Watch UK is speculating. It is simply not acceptable for the Government to say, “We have no idea, guv. They could go to Stornoway, Lostwithiel, Aldeburgh or Chichester.” We are in government to take decisions. Our Ministers are in government to work for the good of the people who elected all of us, and part of that means using the machinery of government to give people facts and data with which to make decisions. I will not name the Government aide concerned, but I was very patronisingly told last week by a Parliamentary Private Secretary: “Oh, we don’t know any of the facts. We can’t speculate. We’re just going to have to suck it and see.” That is not good enough, and I do not think that my constituents or hon. Members here would expect that to be the position.
I pay tribute to the heroes of the public services in Peterborough, who eight years ago did not see the deluge of unrestricted, unplanned migration coming towards them. The teaching assistants, the teachers, the police officers, the housing officials, and my city council—with which I do not always agree—have done a fantastic job in keeping the lid on what could have been a very difficult situation. I look to the Minister to give us some answers, to tackle this most pressing problem, to keep the faith with our voters, and to reiterate that it is for us and this sovereign Parliament to decide who comes to our country and what they do when they get here.
Chris Bryant (Rhondda) (Lab)
It is a great delight to serve under your chairmanship, Mr Howarth. It is something I have never done before. This is also a great opportunity to commend the hon. Member for The Wrekin (Mark Pritchard). I prefer his speeches when he is attacking the Prime Minister rather than the Opposition, but he put his argument very well and, although I hate to embarrass him, I agree with quite a lot of what he said.
I agree also with a lot of what the hon. Member for Peterborough (Mr Jackson) said, and I will go through some of the issues line by line. His last sentence, however, slightly antagonised me, because although he commended the staff working in the local services in Peterborough who, he said, did not foresee the deluge that was coming, I think that quite a lot of the people who came ended up working in those same public services. It is not, therefore, quite a dichotomy between them and lots of people from outside the UK who have ended up doing nothing for this country because, in many cases, those are the people who have worked the hardest.
One thing that I think everyone who has spoken thus far has said—and I am sure the Minister will do the same—is that migration and migrants have brought a great deal to this country, economically and culturally, and not just in the generations that we have been part of but in many before. The Rhondda would certainly not be the constituency it is today, with rugby players with surnames such as Sidoli, if it were not for migration from Italy in the 19th century when people came to work in the mines. We actually allowed an awful lot of people to come from England too, which was a moral dilemma for us but, seriously, migration has affected every element of our country.
Mr Stewart Jackson
May I just set the record straight? I represent a constituency which has had, in no particular order, Irish, Italian, Polish and Pakistani immigrants, and I do not have a problem with the essential integral concept of immigration. It is just the speed and the scale that is the issue.
Mr George Howarth (in the Chair)
Order. All that is very interesting, but I am afraid it needs to lead towards Bulgaria and Romania at some point soon.
Chris Bryant
Exactly, and Bulgarians and Romanians will be grateful to have heard precisely that point.
Just because someone is concerned about the levels of or the pace of migration, does not make them a racist. There might be some people who want to engage in the debate who have prejudiced views, but the vast majority of ordinary decent people in this country who have expressed concern do so from a position of no prejudice at all but simply because they are worried about the society in which they live. Let us face it, because of the now different travelling opportunities around the world, many countries have had to face a complete change. Italy was always a country that sent people abroad, and now it has had Bulgarians and Romanians coming in in significant numbers. Greece is exactly the same. It invented the word diaspora for all the Greeks who had gone all around the world, but in the past 10 years it has been a country of immigration, not emigration, completely changing the concept of what it is to be Greek.
I used to be a curate in High Wycombe, and there was a very large community of Poles there, who had arrived during and after the second world war and had become an integral part of the community. Similarly, there are more people from St Vincent living in High Wycombe than there are in St Vincent itself. They were deliberately brought to the United Kingdom after the second world war because we did not have enough people to make the chairs and keep the economy growing in such places. I believe, therefore, that a hermetically sealed country would be a mistake, leaving aside the fact that many British people have always wanted to go elsewhere in the world to make their fortunes. One thing that extending the European Union should have done is give British business and British individuals a greater opportunity to make their way in the world, in other countries, and many of them have done so in Spain, France and Italy, and also in Bulgaria and Romania. I hope that British industry will seize the opportunity of Bulgaria and Romania as a means of making money and advancing British business.
I note that there was unanimous support for enlargement when the proposal came to the House of Commons in 2004. The right hon. Member for Mid Sussex (Nicholas Soames) is not in his place at the moment, but the one thing I would say to him is that he could have made the point in 2004 if he had really believed that the Government had completely and utterly got their figures on migration from eastern bloc countries wrong. He could have tabled an amendment to the Act that implemented the treaty to say that there should be further transitional controls. He could have made a speech about it. He could have argued that Bulgaria and Romania should not be allowed to join the European Union and he could have forced a vote on the treaty. But he did not—no one did. We have to bear in mind sometimes that hindsight is a political sin and not a political virtue.
I agree with the hon. Members who said that migration must be controlled and sustainable, because otherwise local communities simply cannot cope. It is about infrastructure, schools, the health service and so many different things. I willingly accept that Labour was wrong not to have put in place the transitional controls for the maximum period that was allowed under the treaty when the A8 countries joined the European Union. As probably one of the most ludicrously pro-European Members of the House, I would say that we were not pro-European enough. The irony was that while France, Germany, Italy and Spain were saying, “Polish people, Estonians and Latvians, you can come here to live but not to work until seven years are over,” we decided to go it alone, and that made the problem infinitely worse because there was only one place where people could go. Talk about a pull issue! That was almost a push issue. I willingly accept, therefore, that we got some things wrong.
It is worth bearing in mind what has happened in relation to Bulgarians and Romanians in member states that have removed transitional controls ahead of us. For instance, in Germany, the numbers went from 158,000 in 2009 to 272,000 in 2012. It is worth pointing out, of course, that Germany is now actively promoting immigration, because it believes it needs it. One of its Ministers recently said:
“While our population is ageing, we have a low birth rate. Currently, of the total population of 80 million in Germany, 41 million are employed. Over the next 15 years, we could lose about six million workers just for demographic reasons”.
The Germans therefore want to encourage more people to come to their country.
Mark Pritchard
The hon. Gentleman is usually well informed, and I am sure this was an oversight, but Germany, although not sealing its borders, is looking at reducing the pull factors for the new accession countries. He may not have heard about that yet.
Chris Bryant
It is actively campaigning at the moment to encourage inward migration, and particularly skilled migrants. [Interruption.] I see the civil servant shaking his head, but we will doubtless hear from the Minister when he is inspired by his civil servant to correct me.
Mr George Howarth (in the Chair)
Order. The hon. Gentleman is an experienced Member of the House, and he knows that he should not refer to those who are not within the confines of the Chamber.
Chris Bryant
My inexperience shows itself so frequently that it is a delight to have your experience in the Chair, Mr Howarth—[Interruption.] However, since you are talking to me while I am speaking, I cannot hear you. Spain removed the transitional controls much earlier and put some of them back in place in 2011. [Interruption.] I am so sorry; I am not sure where that comment came from, Mr Howarth. There are more than 1 million Bulgarians and Romanians in Spain, and similar numbers in Italy, which has also withdrawn the transitional controls.
It is important that we consider what drives where an EU migrant might go, although I might reach a slightly different conclusion from some others. Among the most likely things to decide what country an EU migrant, such as one from Bulgaria or Romania, goes to are, first, the law—whether they are allowed to migrate there—which explains the situation we have at the moment. Secondly, there are personal connections. If a person already knows somebody in a country, they are more likely to go there than to another country.
Thirdly, there is language. Several Members have referred to the fact that English is a key factor. Short of persuading Britons not to speak English any more, I am not quite sure what we can do about the fact that English has become the language of business around the world. However, it is also true that one reason many Bulgarians and Romanians have gone to Italy and Spain is that Italian and Spanish are still taught in schools in Bulgaria and Romania, and other Romance languages are a more easy fit; it is much easier for a Bulgarian or a Romanian to learn Italian or Spanish than English.
The fourth factor is where there is work; that is absolutely vital. That is why Germany is still the No. 1 destination for Bulgarians and Romanians. Interestingly, a couple of Members have referred to the “Newsnight” report coming out today and the different ways it has been reported. We could read the figures in many different ways, as hon. Members have, but one figure was quite interesting. When asked whether the benefits system would make a difference to the country they went to, 72% answered, “Not at all”, 8% said it would to a small extent, 5% said it would to a great extent and 3% said it would to a very great extent. We therefore need to be cautious about stating that the benefits system drives whether somebody comes to the United Kingdom, although, as several hon. Members have said, there is a significant difficulty with family benefits provided on a non-contributory basis. Those are tightly regulated by the EU, which is very keen to enforce its directives and case law. That is something we need to look at.
Keith Vaz
I am listening to my hon. Friend’s arguments carefully. Would it be a good idea for the Government to commission research so that we know the approximate numbers of people who might come here? He is talking about opinion polls, which are always useful, and we, as politicians, like them. However, would it not be a good idea to have a detailed piece of research on this subject?
Chris Bryant
We tend to like opinion polls when we agree with them; if they do not quite agree with us, we dismiss them or we try to reread them in a different way that concurs with our opinion. Sometimes, of course, people ask questions in opinion polls in such a way as to get the answer they want. I am pretty certain the Government have done significant research on this issue. The Foreign Office has already admitted as much in response to a freedom of information request from me, although it said that it is not yet prepared to publish that research. The only reason it is not prepared to give it to me under freedom of information provisions is that it will publish it in the future. That is a somewhat bizarre way of proceeding. Different Ministers have articulated their views about this, but it is a shame that we are not all being treated as the adults we are and that we cannot, therefore, see this material, as Ministers can.
Let me refer to a couple of other issues. First, there is the Labour market.
Chris Bryant
I will not, if the hon. Gentleman does not mind, because we have to hear the Minister, and we do not have many Ministers—sorry, many minutes left. We have plenty of Ministers left, but not many minutes.
On unscrupulous employers, we know there are employers who will bring people from countries where labour is cheap, take exorbitant amounts from their wages for substandard accommodation and transport—their daily transport in the UK or their transport from another place in the EU—and still not even pay them the national minimum wage. Those workers are financially bound to their employers and feel they cannot complain, which is one of the problems we have with enforcing the national minimum wage. If there is one issue we could tackle that would most dramatically affect that situation, it is accommodation. Nobody should be living in substandard accommodation. Such a situation leads to the exploitation of workers who come here, and it unfairly undercuts workers here, who have no choice about how much their housing costs will be. The hon. Member for North East Cambridgeshire (Stephen Barclay) was absolutely right that we need to address the issue of houses in multiple occupation, but I think we should have a licensing system for all landlords. We should also extend gangmaster legislation to other areas of employment.
Finally, the national health service was created by British people for British people. It should, as the hon. Member for The Wrekin said, be primarily a national health service for those who have contributed. However, we have to have certain exceptions. Obviously, one is emergencies. Another is notifiable diseases; otherwise, we could have a real problem in some parts of the country with tuberculosis and other diseases. Thirdly, there is mental health. In London, in particular, there is a problem.
The Minister for Immigration (Mr Mark Harper)
It is a great pleasure to serve under your chairmanship, Mr Howarth, in the second half of the debate, and it was a great pleasure to serve under Mr Walker in the first half.
If Members will forgive me, I will not take many, if any, interventions. I will try, in the less than 15 minutes I have, to do justice to my hon. Friend the Member for The Wrekin (Mark Pritchard), who secured the debate, and to all those who contributed. You have indicated, Mr Howarth, that you wish me to finish at 7.53 pm to allow my hon. Friend to speak for a couple of minutes before the debate concludes, so I hope that Members will forgive me if I do not take many interventions.
I congratulate my hon. Friend not only on securing the debate, which was in response to the petition—I will say a few words about its specific terms in a moment— but on the moderate and reasonable tone in which he introduced it, which clearly set a good example, because that was the way in which all other Members debated the issue. That is important if we are to have a sensible debate led by mainstream political parties and not extremists.
The debate was granted by the Backbench Business Committee, to which I pay tribute also, because the e-petition received more than 100,000 signatures. Once it passed that number it received a written Home Office response, which hon. Members can see on the website. I will discuss the e-petition because hon. Members alluded to it but did not go into its terms in detail. It contained two requests, and I can give a positive response to one. One is that
“the government suspends the easing on these restrictions for another 5 years.”
The other is about whether the Government should renegotiate some of the terms of our membership of the European Union.
The first of those requests relates to the point made by my hon. Friend about the extent of our ability to do something now about the ending of transitional controls at the end of the year. I assure my hon. Friend and the other hon. Members who made the same point that Ministers test the legal advice that we get from Government lawyers and outside counsel. I particularly like doing that. I have had legal advice in the past that I have challenged, and which turned out to be just that—advice. It is worth testing it, and Ministers do so. That is consistent throughout the Government from the Prime Minister downward. My hon. Friend talked about restricting movement on grounds of public policy, public security or public health, but the free movement directive says in terms that those grounds shall not be invoked to serve economic ends. I am not going to go into huge amounts of detail, or I shall do nothing for the next 15 minutes but discuss legal matters, but I do not think there is any possibility, under the directive or the accession treaties for Bulgaria and Romania, of complying with the request in the petition.
I think that we can be more positive about the second point in the petition, and my hon. Friend and several other hon. Members have referred to the Prime Minister’s clear commitment, in his capacity as leader of the Conservative party, to renegotiate, if we win the next election, the terms on which we are members of the European Union. As my hon. Friend the Member for Kettering (Mr Hollobone) said, we will put that to the people. Some hon. Members may take different views on that, but we can all agree that the public will then get a choice, and will be able to make a clear decision. We can deliver on that part of the petition.
It is also worth saying, in relation to the public debate, that the Prime Minister made it clear in a recent speech that the Government understand public concern about immigration and are not just willing but keen to encourage sensible debate about it. Those points were made by the Select Committee Chairman, the right hon. Member for Leicester East (Keith Vaz), by my right hon. Friend the Member for Mid Sussex (Nicholas Soames) and by my hon. Friend the Member for Keighley (Kris Hopkins). The Government do not believe there should be no net migration; we just think that it should be sustainable. We want to reduce it from the unsustainable hundreds of thousands to the sustainable tens of thousands. Various Members have talked about the benefits to be obtained from some migration, and the Government agree with them.
Of course, 1.4 million British people live in another EU country, either in retirement or working. We should always remember that, when we are engaged in this debate. Britain’s future, like its past, is as a global trading nation, which means that many British people will work and live abroad. We cannot expect other countries to allow us to do that if we do not allow movement too. It is right, however, to take account of public concern about free movement, and to deal with that. I want to flesh out some of the points that my right hon. Friend the Prime Minister has made.
Several hon. Members addressed the point that actions that the Government took from the moment they took office have already reduced net migration by a third since the general election. That is significant. Also, only a third of the people coming to the United Kingdom are from the EU; 55% come from outside it and 15% are British citizens returning home, so the bulk of our net migration is from outside the EU. That is important to remember in a debate about migration from Bulgaria and Romania, and the point was well made by my hon. Friend the Member for Daventry (Chris Heaton-Harris), who has extensive European experience.
There was a lot of debate about Government attempts to forecast how many people would come here from Bulgaria and Romania when transitional controls ended. My hon. Friend the Member for Kettering referred to that in his Westminster Hall debate, and the right hon. Member for Leicester East asked whether the Government would commission advice. Of course they did commission advice, and asked the independent Migration Advisory Committee what we should do—whether it was possible to predict the scale of future migration. The committee made it clear that
“it would not be sensible, or helpful to policymakers…to attempt to put a precise range around this likely impact.”
It did not think it was possible to come up with accurate figures. The reason is that, unlike the previous experience, with the A8 countries of eastern Europe, eight other countries have transitional controls. We are not likely to be able to predict accurately how many people are likely to leave Bulgaria and Romania to work overseas, and to which of the countries with transitional controls they are likely to go.
I said in the previous Westminster Hall debate, secured by my hon. Friend the Member for Kettering, that the reason the Government did not want to forecast was that we did not think we could do so accurately, and we wanted to be straight with people and say so, rather than making up a number. We could just make up a number, and use it for the rest of this year; but that would probably be as accurate as what happened under the previous Government. It would not be treating people as adults. We got clear advice from the Migration Advisory Committee, and it has been supported by the recent report of the National Institute of Economic and Social Research. The institute said that
“it is not possible to predict the scale of future migration from Bulgaria and Romania to the UK numerically.”
I presume that that means it is not possible to do it accurately, because clearly it is possible to predict it, but the likelihood of being accurate is I think slim. That is a sensible point of view and we have been straight about it.
The hon. Member for Rhondda (Chris Bryant) talked about a mysterious Foreign Office report, which the Department refused to publish. I think that he meant the report by the National Institute of Economic and Social Research, which was commissioned by the Foreign and Commonwealth Office. That might not have been published when he asked his question, so perhaps a reference was made to the fact that it was to be published. Of course it has now been published, and it reached the conclusion about predicting numbers that I have set out. It was perfectly sensible for the Government to say what they did; that was treating people with respect.
Several hon. Members wanted me to say more about the inter-ministerial group on access to benefits and public services. Rather than producing speculative projections, we have been considering the work being done across Government—I am pleased to say that all Departments concerned with delivering public services are involved, along with the Department for Work and Pensions, which deals with benefits—on cutting out the abuse of free movement, and addressing the pull factors. With reference to something that the hon. Member for Rhondda said, it is worth pointing out that Germany is strongly opposed to benefit tourism—the abuse of free movement. We have been working with Germany and, indeed, the Home Secretary—along with her German, Austrian and Dutch counterparts—recently signed a letter to the European Commission to ask it urgently to review the current arrangements on the availability of social security benefits to newly arrived EU migrants, and stressed the need for more robust legal measures, such as re-entry bans for individuals removed from the UK for abusing their free movement rights.
I mention that because we are not of course alone in sharing such concerns, and I am therefore quite hopeful about not only what we may be able to achieve in this Parliament, but the seriousness with which other European countries will take our views on changing our relationship with the European Union. As we have seen, my right hon. Friend the Prime Minister has a close working relationship with his counterpart the Chancellor of Germany. That positive work will continue.
Let me briefly set out some of the work that we are doing. We will tighten the rules on access to benefits, and put in place a statutory presumption that European economic area national jobseekers will lose their right to benefits after six months unless they can show that they are genuinely seeking work and have a genuine chance of being engaged.
We intend to tighten access to social housing to insist that local authorities have to consider the local rules. I have a little more confidence than my hon. Friend the Member for The Wrekin about their ability to do that. Local authorities where there is an issue—for example, in the constituency of my hon. Friend the Member for Peterborough (Mr Jackson) or elsewhere in Cambridgeshire—will, if we give them a nudge, want to have some sensible controls so that they can deal with their constituents’ concerns.
The final area is the national health service. Some Members have made the point that it is a national, not an international, health service. My hon. Friend the Member for Cities of London and Westminster (Mark Field), who is no longer in his place, had concerns about how well we could implement that, given doctors’ Hippocratic oath. We do not of course propose to remove access to emergency treatment or to treatment required for public health reasons. My right hon. Friend the Secretary of State for Health set out some of that in his response to the urgent question from the right hon. Member for Birkenhead (Mr Field).
There have been some positive views from GPs in their magazine, Pulse, which has undertaken a survey of them. A significant number of GPs want us to take action: three quarters are confused or frustrated about the lack of clarity about NHS entitlement; more than half—52%—said that they believe that NHS provision for migrants is too generous; and only 7% thought that it is not generous enough. In addition, 38% said that they did not want to agree to register people they think are illegal immigrants and 40% did not want to register people who had failed in their asylum claims. Therefore, a significant number of GPs and other doctors will, if we take the matter seriously—obviously we will consult both the public and the professions—support what the Government want to do, and that will be welcomed.
Let me turn, in my remaining two minutes, to criminality. That was raised by several colleagues, including my hon. Friend the Member for Kettering, to whose service as a special constable we should pay tribute. Several things are going on. In London, to which he drew attention, there is the successful ongoing Operation Nexus between the Home Office immigration enforcement teams and the Metropolitan police to target high-harm foreign national offenders and immigration offenders. It has removed more than 400 such people just since last November, so it has been very successful, and we intend to roll it out across the country. There are several operations to deal with lower-level criminality, so a lot is going on.
I have one minute left, so I will conclude. If there are any issues that I have not touched on, the Chair of the Select Committee will no doubt put them to me when I give evidence tomorrow. We have real concerns about the abuse of free movement rights. The Home Secretary has consistently raised that at the Council of Ministers with her European counterparts. We will continue to do so at the European level, as well as through the work of the cross-Government committee, which the Prime Minister has asked me to chair.
In due course, we will introduce a package of measures that I hope colleagues on both sides of the House will welcome. Of course, I could not possibly prejudge what may be announced in the Queen’s Speech in a few weeks’ time, but I hope that my hon. Friends will not be disappointed about the measures that the Government are going to set out. I am glad that we could have this debate today, Mr Howarth, which you have excellently chaired.
Mark Pritchard
It is a privilege to conclude this debate under your chairmanship, Mr Howarth. I am grateful to all colleagues for an even-tempered and measured debate on an issue that is important to all our constituents. I am also grateful to the Government, who are making good progress on reducing net migration, and I am pleased that the Minister has just confirmed that we will soon hear more details.
The British people are tolerant and fair-minded. I believe that the least they can expect from national policy makers is an immigration system that is both balanced and sustainable. I hope that today’s debate has advanced that collective pursuit.
Question put and agreed to.
Resolved,
That this House has considered the e-petition relating to immigration from Bulgaria and Romania in 2014.
Written Ministerial Statements
Urenco
The Minister of State, Department for Business, Innovation and Skills (Michael Fallon)
I wish to inform the House that the Government have decided to work with our partners in the uranium enrichment company Urenco to move forward preparations for the sale of all or part of our one-third shareholding. It is Government policy not to continue to hold shares in companies where the shareholding itself does not deliver any policy objective. Any sale of our Urenco shareholding remains contingent upon full protection of our security and non-proliferation interests, and upon achieving value for money for the UK taxpayer.
Queen Elizabeth II Conference Centre (Targets 2013-2014)
The Parliamentary Under-Secretary of State for Communities and Local Government (Brandon Lewis)
My hon. Friend the Under-Secretary of State for Communities and Local Government, Baroness Hanham, has made the following written ministerial statement:
The agency’s principal financial target for 2013-14 is to achieve a minimum dividend payment to the Department for Communities and Local Government of £1.5 million as proposed in the business plan for the year.
The agency also has the following targets to achieve:
A minimum 52% occupancy of its rooms based on a theoretical full occupancy revenue of £9.7 million;
Overall score for value-for-money satisfaction of greater than 90%;
The number of complaints received to be less than two per 100 events; and
An average response time when answering complaints of less than four working days.
Vocational Education Reform
(11 years ago)
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The Secretary of State for Education (Michael Gove)
We are introducing a new school and college performance table measure which recognises the highest level of technical training achieved by students aged 16 to 19. This will be known as the technical baccalaureate measure. It will recognise the achievement of students taking advanced (level 3) programmes which include a DFE-approved occupational qualification, core maths, and an extended project. This builds on the radical reforms of 16 to 19 vocational qualifications on which we are currently consulting. Establishing a measure for excellence in technical provision will end the perception that vocational education in the UK is a poor second to academic study. Students will be well prepared to enter technician and higher apprenticeship roles in industry, or professional training or university.
It is part of a wide range of reforms that will help to repair the broken link between the qualifications students take, and the training that British industry needs. This will give employers and universities confidence that the vocational qualifications students achieve at 19 will be of a high standard and of real value to students with ambition and talent. The policy statement provides further details on the technical baccalaureate measure, and will be published on the Department’s website today.
Introduction of new technical baccalaureate measure for 16 to 19-year-olds.
Overview
The Government are introducing a new school and college performance table measure which recognises the highest level of technical training achieved by students aged 16 to 19. This will be known as the technical baccalaureate measure. It will recognise the achievement of students taking advanced (level 3) programmes which include a DFE-approved occupational qualification, core maths, and an extended project. It will be introduced for courses beginning in September 2014, for reporting in the 16 to 19 performance tables from 2016.
Establishing a measure for excellence in technical provision will end the perception that vocational education in the UK is a poor second to academic study. By recognising excellence, it will incentivise the development of the highest value provision and encourage the most able students to study demanding technical study programmes.
Students who achieve the qualifications that are included in the technical baccalaureate measure will be equipped to apply for technician roles and higher apprenticeships in a wide range of industry sectors. Alternatively, they could enter professional training or university.
Who is it aimed at?
The technical baccalaureate measure will be aimed at ambitious, talented students who want to pursue a technical career. It will give young people the opportunity to be stretched and demonstrate their personal best.
The group most likely to opt for qualifications included in the technical baccalaureate measure are those who choose to study advanced vocational qualifications having already achieved a grade C or above in GCSE maths. This means that over time, and as standards are raised, the proportion of students able to study at advanced level is likely to increase further.
The qualifications included in the technical baccalaureate measure will be most suited for young people interested in occupations that require significant theory and knowledge acquisition, such as:
STEM technicians (e.g. lab technicians, IT technicians, various engineering technician roles, construction professionals);
Service technicians (e.g. retail and hospitality management, personal services, junior accounting positions);
Creative technicians (e.g. digital media, other media, creative industries, sport industry, material/textiles, design).
What does it include?
The technical baccalaureate measure is made up of three components.
To achieve the measure, a student would need to successfully complete an advanced (level 3) programme of at least one DFE-approved occupational qualification, level 3 maths qualification(s), and an extended project.
i) Occupational Qualifications
At the core of the new technical baccalaureate measure will be the study of qualifications which are recognised and valued by industry. In November 2013 the Government will publish details of the advanced level occupational and other qualifications for 16 to 19-year-olds which will “count” towards reformed performance tables and the technical baccalaureate measure.
The Government are currently consulting on a process for identifying vocational qualifications that are genuinely “high value”. Further information on this can be found at:
http://www.education.gov.uk/childrenandyoungpeople/youngpeople/qandlearning/otherqualifications/a00222542/vocational-qualifications-16-19-year-olds
As part of this process, the Government are asking professional and industry bodies to endorse occupational qualifications that prepare a young person for a specific job role, and are intended for students who have a clear idea about an occupation they want to pursue. Some qualifications will prepare a student for a specific job role by confirming and in some cases certifying occupational competence. Others may provide a route into a specialist degree or a higher education course that qualifies entry to an occupation (many health and engineering professions, for example).
ii) Core Maths
Many aspects of technical education require the understanding and ability to apply maths, and there is evidence that those with level 3 maths benefit from improved employment prospects and higher wages.
Therefore, the technical baccalaureate measure includes the study of relevant core maths qualifications at level 3. This means students will need to have achieved a GCSE A*-C in English and maths before enrolling on a programme which meets the standard set by the new measure.
Further information about the core maths requirement for the technical baccalaureate measure will be published by the Department in due course. From 2014, A-level, AS-level and the international baccalaureate maths qualifications are expected to be included alongside other more applied maths qualifications such as mathematics for engineering. A number of new maths qualifications are currently being developed by awarding organisations and may also be included.
iii) The Extended Project
The extended project will develop and test students’ skills in extended writing, communication, research, self-discipline and self-motivation. Such skills are in high demand by industry and academia. The extended project also gives students the opportunity to undertake research projects with an industry focus relevant to their vocational programme, encouraging them to explore further aspects of the occupation to equip them with a breadth of knowledge and understanding to reinforce their employability.
Time scales
The consultation on 16 to 19 vocational qualifications will close on 10 May. Details of the approved occupational qualifications which will count towards the technical baccalaureate measure are expected to be published in November 2013. The technical baccalaureate measure will be introduced alongside the teaching of these qualifications from September 2014. The measure will first be reported in the 2016 performance tables, due to be published in January 2017.
The Government’s forthcoming 16 to 19 consultation will propose further detail on how the technical baccalaureate measure will operate alongside wider 16 to 19 accountability reforms.
Agriculture and Fisheries Council (Agenda)
(11 years ago)
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The Secretary of State for Environment, Food and Rural Affairs (Mr Owen Paterson)
The next Agriculture and Fisheries Council is on Monday 22 April in Luxembourg. I and my hon. Friend the Under-Secretary of State for Environment, Food and Rural Affairs, the Minister with responsibility for natural environment, water and rural affairs, the Member for Newbury (Richard Benyon) will be representing the UK. Richard Lochhead MSP and Alun Davies AM will also attend.
On agriculture, the presidency will report to the Council on progress in the common agriculture policy (CAP) trilogue negotiations between the European Council, Parliament and Commission.
The fisheries items will follow with an orientation debate on the reform of the common fisheries policy, a presidency progress report on the negotiations relating to the common organisation of the markets for fisheries and aquaculture products dossier and a Commission presentation on an action plan for reducing the incidental catches of seabirds in fishing gears. Spain has also requested an AOB item on the state of play of fishery protocols with Morocco and Mauritania.
Grand Committee
The Deputy Chairman of Committees (Baroness Andrews)
My Lords, if there is a Division in the House, the Committee will adjourn for 10 minutes.
EU: UK Isolation
(11 years ago)
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Lord Dykes
To ask Her Majesty’s Government what steps they will take to avoid increasing United Kingdom isolation in the European Union.
Lord Dykes
My Lords, I am most grateful to the usual channels for the opportunity of launching this vital debate today. Sadly, I have to say at once that the rather controversial and rather expensive funeral event last Wednesday provides a sombre memorial to this theme, recalling to all of us the negative attitudes towards Europe of someone who was—again, I feel sad about saying this—one of the most rebarbative Prime Ministers in Britain’s post-war history.
The present Prime Minister, however, was obliged to call off visits to EU capitals to discuss some changes in our links to the rest of the member states. It is very self-defeating if leading Tory Ministers and politicians refer to the over-repeated phrase “British national interest” as if that were wholly different from our membership of the Union and totally different from that of all the other members. At least the late-interred Prime Minister ended up usually agreeing with the others on treaty changes, despite all the Sturm und Drang in those days of shrill arguments. Mr Cameron, however, is now in danger of launching a risky plan which is designed to appease his wilder anti-EU MP colleagues, and which could quickly get out of control.
It also looks somewhat hilarious if a British politician starts trying to educate our German friends on the goals of economic and mercantile efficiency, bearing in mind the huge gulf in our economic performance. We have a UK trade deficit of around £100 billion, despite a quarter fall in the value of sterling over the past four years. Germany’s trade surplus is the other way round, but even bigger. We should all be grateful to the German ambassador for his polite but riveting comments at Bloomberg’s last July on the dangers inherent in irresponsible isolation and to Dr. Rudolph Adam, the plenipotentiary at the moment. He complained to William Hague’s assistant last October that Britain’s refusal to take a lead in Europe meant that we would just see the red lights of the train that has already left the station.
Indeed, we have heard the same complaints from our own citizens, now alarmed at this possible Cameron demarche. I refer to very prominent business leaders such as Richard Branson, Martin Sorrell and Sir Roger Carr. Incidentally, the US Government intervened collectively and individually to say, “Please do not go down this path”. Former EU and US British envoys such as Sir Nigel Sheinwald have taken this approach. Indeed, in one of our debates on 17 December 2012, the noble Lord, Lord Kerr of Kinlochard, who was originally speaking in this debate, said:
“As the Prime Minister prepares … I really hope he will avoid the temptation to hold out a false prospectus. One should not talk about ‘new deals’ unless one is sure that they are realistic”.—[Official Report, 17/12/12; col. 1391.]
It is never a weakness for any country, struggling as we are with our economic problems in an exposed position, to pay attention to what others think of us. Sadly, we have to recall, painfully, the derision which many mainland Europeans felt when we were first driven out of the exchange rate mechanism on 16 September 1992 as the Treasury was unable to keep the pound from falling below the agreed minimum level. We then became so scared at the huge obligation and discipline involved in a single currency that we effectively decided not to join at all, despite Tony Blair’s pretences.
We have to recall, therefore, the huge disappointment of the other members in other areas. We received the unique budget rebate but did not then become more co-operative on other areas of European endeavour, despite that unusual privilege. We have to recall the irritation, too, when we sought the biggest number of opt-outs and exclusions when Maastricht and the later treaties, including Lisbon, came along.
The irritation we now cause when a UK Minister arrives for a Council of Ministers meeting is palpable. We have become the bad member of the club, whingeing and moaning about European things again and again. One of the dottiest reasons for this irrational behaviour is because an unusually large number of old-fashioned nationalist Tory MPs are the only politicians I know—apart from some of the scallywags in UKIP, many of whom benefit from the PR system for the European Parliament—who have a notion of national sovereignty which is, literally, at least 100 years out of date.
How many times do positive Europeans have to remind such people that pooling sovereignty by way of signing unanimous treaties, achieved by consensus, is not a loss of real sovereignty, it is an increase? We have done it in other treaties, to no ill effect, all over the world. It is quite extraordinary and myopic that a false pride in our so-called special relationship and so-called hyperbolic link with the US can induce British leaders such as Mr Blair, Mr Brown and, indeed, the present Prime Minister, to go into rather questionable military adventures—which we usually later regret—but also cause us to suffer hot flushes when confronted with a perfectly sensible measure of EU co-operation such as a new financial support system between the central banks. They were watching our reactions very closely at that time.
At the same time, as if to emphasise the muddle, Mr Cameron seeks to remind us that he wants after all to stay in the Union. Before we irritate the others to the extent that they muse again about the Lisbon treaty provisions allowing for recalcitrant member states to leave if they wish, we really need some clarification on these vital—indeed, existential—matters. What relationship would replace the present one? As Peter Ludlow, the well known EU analyst based in Brussels, said in January,
“The argument that the rest of Europe will simply acquiesce in whatever kind or arrangement (we) opt for, because ... our partners need us ... more than the UK needs them, is a total illusion”.
Furthermore, when you use the microscope on repatriation, you soon realise that it is the grand illusion and pretence of all time, especially when you see that we already have more opt-outs, exceptions, derogations and exclusions than any other country.
I am therefore extremely grateful to my noble friend the Senior Minister of State at the Foreign Office, Lady Warsi, for coming to answer this debate today— I wish her well in her response—and, indeed, for all the previous occasions when she has dealt with a vast number of questions and debates on these matters with great care and attention to detail. Now she has the precious opportunity to enlighten us all so that we can leave this discussion with a spring in our step.
A few weeks after the PM sadly refused to attend the Nobel Peace Prize award to the European Community in Oslo, I had the chance to ask my noble friend what further opt-outs we would now seek in Brussels. She very kindly stated that,
“the Government always seek outcomes that are in the national interest … our priorities include … the single market and … fair competition”.
When I pressed for more specific answers to try to,
“avoid needless opt-outs of a chauvinistic or nationalistic nature”,
she added that HMG should be,
“putting a case … that the European Union is improved but, within that, we also get a good deal”.—[Official Report, 4/2/13; col. 9.].
I hope that she will not consider it discourteous to suggest that this is all rather vague and generalised.
I live in France as well and have the opportunity to observe public life and politics there at close quarters. It is interesting that such a proud—indeed, sometimes very nationalistic—country sees absolutely no contradiction between its own direct interests and those of the Union. They coincide symbolically too—as in Berlin and Madrid, and most other capitals, the EU flag flies proudly alongside the national tricolour. They do not feel the one cancels out the other. The UK is the only major member state where government buildings never, ever fly the European flag. Why are we so nervous about Europe? Why are we so immature?
Let us return to the need for detail on policies. For example can the Minister guide us on what list of opt-outs we will determine for inclusion and exclusion in the JHA review? My impression is that the Government have not got a clue what to do. My noble friend will know of the report of sub-committees E and F of the EU Select Committee showing the huge weight of non-political evidence that abandoning the JHA provisions, or the principal ones, in most of the specific policy areas such as EAW, would be a monumental disaster. I will refrain from commenting too much on what Kenneth Clarke said at the end of January on these matters. How the Prime Minister must now regret the way in which the Government, including when they were in opposition, have encouraged the most Europhobic MPs to fuel this anti-EU strategy with the business community outside—although not many leading businessmen are now still involved—to the extent that it is even becoming part of future leadership moves by some ambitious new Tory MPs. The bitterness felt by the EPP in Brussels and Strasbourg about the Tory withdrawal in the European Parliament still lingers.
Can the Minister help us today about what kind of referendum will be constructed after so-called renegotiations have run their course, especially since the Business Secretary reminded us again recently that it will scare off investors and hit the economy?
The other area where we need meticulous care by the Government is in responding to the widespread dismay about the City of London market culture which is expressed here so stridently. The City—and I am a City person myself—is indeed a very precious asset which we are proud of and fortunate to possess, but the market crash of 2007-08, the way in which the banks behaved and the speculative spivery background of some people in the City offend some of our continental friends, and that needs to be acknowledged. Although I shall not quote from them, I commend in this context the lengthy but convincing last two paragraphs of the speech by the noble Lord, Lord Liddle, the chief Opposition spokesperson on Europe in this House, in the debate on the EUC report on banking union in Grand Committee on 26 March. He set out very clearly what our responsibilities should be.
Another area where the UK needs to respond sensitively to our partners is in their anxieties about tax havens, where our overseas territories are a particular preoccupation. Above all, we need to remember the chilling reality that, apart from the natural courtesy of a vague response, not a single other member state agrees with our peculiar attitudes, these initiatives that have recently been promulgated, not even the newest member states, not even Poland, very little in the Czech Republic, not at all in Spain or Italy and certainly not in Croatia. The Tory party needs to show the courage and enthusiasm for Europe that Mrs Thatcher showed in 1975.
I look forward to my noble friend helping us today with some encouraging responses about how these strange negotiations will reduce our isolation.
Lord Howe of Aberavon
For pretty well all of our 40-year membership of the Union, successive British Governments have sought to maintain a position of strength for this country at the top table of the European Union politics. Whatever opportunities may have been missed and whatever mistakes might have been made, a common thread throughout the period has been that consistently Prime Ministers and Foreign Secretaries attempted to avoid the development of anything approaching a two-speed Europe. We have accepted opt-outs and derogations in specific cases, but we have never allowed Britain to lose its place at the heart of EU decision-making, although we have been sliding away from the centre.
One of David Cameron’s first acts as Prime Minister was to decline to attend eurozone summits, whereas his predecessor, Gordon Brown, not exactly a noted euro-enthusiast, fought tenaciously to ensure that he was always invited. Our absence has made it more difficult to articulate Britain’s voice on some of the key decisions in the eurozone debt crisis. I do not need to spell out at great length my anxiety about the imminent shift in responsibility for banking supervision, for example, from the traditional EU institutions in Brussels to the European Central Bank in Frankfurt, based on a new banking union from which we seem determined to exclude ourselves. It is worth recalling that when the EU Bill was debated here at Westminster, two years ago, we were assured that it would have no operational effect in this Parliament, yet we now know that fear of the need for the passage of an Act of Parliament helps to explain why the Prime Minister vetoed the EU treaty change that Mrs Merkel wanted in December 2011.
The net effect is not just that we are throwing up unnecessary political obstacles in the way of our own involvement; we are beginning to stand in the way of others moving ahead. In fact, the real terms of British membership of the Union have sadly already been redefined; instead of seeking to continue leading in Europe, the Government are in danger of gradually locking us all into the defensive mentality of a country reconciled to life on the margins, as support for European membership declines and Euroscepticism becomes increasingly dominant.
If the Prime Minister is serious about obtaining what he calls “fresh consent” for our membership of the Union in a referendum that he presumably hopes to win, he must begin now to set out a more realistic account and a more positive vision of why the European Union should feature as part of the future of this country, and how and why we can play an important role in helping to shape the future of our continent, as well.
Baroness Quin
My Lords, I congratulate the noble Lord on securing this debate. He has consistently advocated the importance of close relations between ourselves and our European partners and has always argued for making Britain’s membership a success, as has the noble and learned Lord, Lord Howe of Aberavon, whom it is a pleasure to follow.
I am not opposed at all to a Government arguing for change within the European Union, nor am I opposed to wide public debate about that issue, providing that it is well informed and open, because there is no doubt that Europe is changing and has to respond to a large number of challenges. However, I have great concerns about the Government’s goals and the lack of clarity surrounding them. I also have concerns about the timing of recent government initiatives, which are sometimes unhelpful, particularly as they come at a time when the eurozone countries are, quite understandably, concentrating on trying to resolve current difficulties. I also have concern about the Government’s approach to alliance-building, both with other Governments and in the context of the European Parliament, where the Government seem sadly to have cut themselves off from the European mainstream.
In the short time that I have available, I would like to question the Government about their goals. There is a lot of talk within the Government, and within the Conservative Party particularly, about having a looser relationship with the European Union. The more I read about this, the less I understand exactly what is meant by it, and I would like some clarification of what is in the Government’s mind. For example, what does it mean for environmental policy, an area that has become very important in EU work in recent years? What involvement do the Government expect to have in that very important area of policy in future? What about economic policy? It is not just about the euro but about many other things. How are the Government going to approach this? For example, I was disappointed recently that they managed to get themselves in a minority of one over the bankers’ bonuses issue, even though it is an issue that is of concern to citizens across the European Union. What does it mean for development policy? Will we be involved in development policy in future, in the Government’s view, or is that something that they want to see left to national Governments? What about the extent of foreign policy co-operation, an increasingly important area within the European Union’s work?
Furthermore, we know that the Government said a lot of things in opposition to social policy, which was a part of the EEC from the outset—so it is not a dangerous additional add-on. I remember, when I was first in Parliament, the warnings that the Government gave about what they called the job-destroying social chapter, even though, after the Labour Government signed it, employment was at the highest ever recorded level and their fears seemed to be completely unfounded.
In approaching those things, I urge the Government not to oppose those policies capable of attracting our citizens and electors. I refer to the excellent brief provided to us by the Law Society, which says:
“The EU has taken significant steps towards ensuring equal treatment; in particular in the work place through initiatives such as the Equality Directive and Equal Pay Directive. The Society is keen to ensure that UK works alongside other Member States as the EU continues to protect and uphold such rights whilst respecting differing legal traditions”.
The noble Lord, Lord Dykes, mentioned justice and home affairs co-operation. That has been a welcome area of co-operation in terms of practical results, but it is not at all clear what the Government’s approach will be to that in the future.
My final plea is that I hope the Government will take some of their arguments out to the public so that we can all join in. It would be good if next year’s European elections were about European issues rather than a referendum on national government policies. Perhaps that would be a better opportunity than a referendum at some vague time in the future.
Lord Birt
We thank the noble Lord, Lord Dykes, for allowing us to debate this highly pertinent issue. I have previously praised the Prime Minister’s speech on Europe as a cogent and elegant statement of all the reasons why it is in our interest to remain part of a reformed EU. He set out a positive vision, but I think his speech has created a significant problem for us.
In the past few months, going about my daily business in Europe and countries beyond, I have encountered, as I am sure others here have, senior officials and politicians from some of Europe’s major countries as well as many of the world's leading investors and some substantial business heads who can make investment choices about this country. To a person, they have concluded that the Prime Minister’s announcement of a referendum is the first step in a determined process on the part of the UK to extricate itself from the European Union.
I do not believe that to be the case. I routinely inquire, “Have you read the whole speech?” but, frankly, no one I have spoken to—and I am talking about many people over the past couple of months—has ever read the whole of the Prime Minister’s speech. That should not surprise us. In busy lives, people settle for the summary report, perhaps online, or skim-read and form a quick impression. I have no doubt—again, I am sure that this view will be shared by others here—that all the major players in Europe want us to stay part of the European Union and to engage, not least to help the present and continuing crisis. But in the short term, other major countries doubt our commitment. In the wider world, we risk being seen by major global investors as detaching ourselves eventually from the single European market. I am sure that this will be common ground among us, but we can ill afford an investment pause in the UK for the next four years.
The Prime Minister has now begun his sadly interrupted tour of major European capitals. I have no doubt that he will have conveyed a nuanced picture of our true position to his senior colleagues in Europe. But beyond that, I hope that he will fully engage the global media, which I do not think he has yet done, and seek to counter the damaging perception that has been formed about our true position. I hope that the Prime Minister will put over what I think is his essential message: that reform and commitment, not obstruction and exit, are the UK’s preference and intention.
The Lord Bishop of Exeter
My Lords, it may be thought that the Church of England does not have a particularly European perspective, but that is far from being the case. Through its diocese in Europe it is present in all the member states of the EU. It has effective links with other churches throughout Europe and is active in the Conference of European Churches. Together with our partner churches, we are also deeply aware of some of the roots of the EU and the vision of its founders in Catholic social teaching.
It is from this broad base that the Church of England engages with the EU itself through its own representation and structures. Also, in March 2012, it made a submission to the House of Commons Foreign Affairs Select Committee on this very question of the UK’s relationship with the EU.
That submission started from the basis that for the Church the primary purpose of politics, even European politics, is the promotion of human flourishing and the conditions that are necessary to make this happen. This includes economic, social, ethical, cultural and legal conditions. Here, the value of the EU as a single market is not to be ignored. While growth is, of course, not to be treated as an absolute idol, poverty is the enemy of the good life and so of the common good. Thus, regularly over the past 40 years the General Synod has affirmed that, while it has reservations over certain characteristics of European integration—not least its demographic deficit—our propensity as human beings created in the image of God to be creative, productive and generous beings has been enhanced by pooling certain elements of national sovereignty in a common European project. This project, it is worth remembering, has deep spiritual roots. The treaty of Rome is peppered with aspirational phrases such as:
“Determined to lay the foundations of an ever-closer union among the peoples of Europe”,
and:
“Intending to confirm the solidarity which binds Europe and [other] countries and desiring to ensure … their prosperity”,
as well as:
“Resolved … to preserve and strengthen peace”.
One of its founding fathers, Robert Schuman, wrote:
“Democracy owes its existence to Christianity. It was born the day man was called to realize in his daily commitment the dignity of the human person in his individual freedom, in the respect of the rights of everyone, and in the practice of brotherly love towards all”.
It is against this background that we also responded to the Prime Minister’s recent Bloomberg speech, in which he set out a vision and an agenda for European reform. On that occasion, he was certainly right to say that much in the EU needs to change, that the Union should accept the principle that powers can flow not only from member states to institutions but the other way too, and that national parliaments should become more closely involved in EU decision-making. However, there remains a lingering doubt as to whether the Government’s agenda is one of reform for the good of Europe as a whole or a more narrow focus on the repatriation of powers in response to political pressure nearer to home. It would be good to have some clarification about that today.
The value of this debate is that it is a reminder of how much need there is for a more informed public and political debate that might shape both a renewed vision for Europe and our own understanding of how we might best realise it. The churches of Europe see themselves as very much part of that debate and with much to contribute to it. They are deeply embedded in European culture and, although we are distinct, it is still possible and right to think of the family of churches in Europe in terms of the historical embrace of a single faith. Even perhaps particularly as Europe becomes increasingly characterised by the diversity of faiths within it, our own long experience of interfaith dialogue and co-operation has a valuable contribution to make to the pursuit of that founding vision grounded in the common good.
Finally, in this context, it is perhaps especially good to recall an observation of the Chief Rabbi, the noble Lord, Lord Sacks. In an address in Rome last year, he said that,
“the future health of Europe, politically, economically and culturally, has a spiritual dimension. Lose that and we will lose much else besides”.
He went on:
“To paraphrase a famous Christian text: what will it profit Europe if it gains the whole world yet loses its soul?”.
I hope that the failure of successive British Governments to articulate a coherent and constructive policy towards our European partners and to manage to take public opinion along with this will not contribute to that loss of the European soul.
Lord Bilimoria
My Lords, today a statement was signed by business leaders, and I was one of the signatories for Business for Britain. The statement was very simple:
“As business leaders and entrepreneurs responsible for millions of British jobs, we believe that the Government is right to seek a new deal for the EU and for the UK’s role in Europe. Far from being a threat to our economic interests, a flexible, competitive Europe, with more powers devolved from Brussels, is essential for growth, jobs and access to markets. We therefore welcome the launch of Business for Britain’s campaign for real change in the EU and urge all political parties to join in committing themselves to a national drive to renegotiate the terms of Britain’s membership of the EU”.
After signing that, I was accosted by many people today saying, “This means you are anti-Europe”. I am not anti-Europe in any way whatever—in fact, quite the contrary. A week ago, before this statement, the British Chambers of Commerce released its survey on Europe. The BCC’s European Union business barometer of more than 4,000 businesses shows support for renegotiation with Europe. A week before this statement came out, John Longworth, the director-general said:
“Companies believe that re-negotiation, rather than further integration or outright withdrawal, is most likely to deliver business and economic benefit to the UK”.
This is the first major survey of British business following the Prime Minister’s policy speech on Europe in January, and it has revealed broad support by business for renegotiation of Britain’s relationship with the European Union. In fact, the results were staggering, such as:
“Remain in the European Union, but with specific powers transferred back from Brussels to Westminster received the highest positive impact rating, with 64% … the lowest negative impact rating, with 11% … Full withdrawal from the European Union received the highest negative impact rating, with 60%”.
Businesses do not want to withdraw from Europe. Another result was:
“Remain in the European Union with no change to current relationship received the lowest positive impact rating, with 15%”.
This is business speaking. Do we want to listen to business or do we want to live in a Utopian world?
I thank the noble Lord, Lord Dykes, for bringing forward this really important issue. The Prime Minister’s speech has raised an important matter. Whether to have a referendum is a debatable issue but the reality is that we are against the financial transaction tax. After everything that has happened with the financial crisis, the City of London is still the number one financial centre. On the idea of a “veto” last year with the Prime Minister walking away from the table, I do not necessarily agree that that was the right thing to do. People said that that means that we will not be at the top table of Europe any more. Well, when it came to the budget negotiations the Prime Minister was very much at the top table in encouraging the budget to be cut.
We have MEPs with no representation. Nobody in this country knows who their MEP is; MEPs do not even know their constituents. We have a Parliament that moves between Brussels and Strasbourg. We have billions of euros of waste. We have free trade agreements that are taking years. Will the Minister tell me when the European Union-India free trade agreement will be finalised? We also have the euro, which has been an utter failure.
There is no question that Europe is our biggest trading partner—more than 50%. There is no question that 2.3 million European Union citizens live here and that almost 1 million British citizens live in the European Union. We want the free movement of goods and people but global institutions need to evolve. The UN needs to evolve; the World Bank needs to evolve and the IMF needs to evolve. The EU has evolved, but the euro was a bridge too far. Thank God we did not join the euro but so many people pushed to do so.
Right now we make up less than 1% of the population of the world but we are still at the top table. We are still a permanent member of the Security Council, a member of the G7, the G8, the G20, and we are still at the top table of Europe. The solution is not to cherry pick but for us to sit down together in Europe and remember our priorities—free trade, free movement of people and, most importantly, the maintenance of peace. That peace is priceless and worth much more than the billions we contribute to the European Union every year.
Lord Bowness
My Lords, I thank my noble friend Lord Dykes for posing this timely question, which should concern everybody who wants to see the UK remain a member of the European Union. That, of course, includes my right honourable friend the Prime Minister who sought to make that clear when he indicated his intention to attempt a renegotiation of our relationship with Europe, to be followed by a referendum on the outcome.
Whether intentionally or not, that has put on the table the possibility of the UK leaving the European Union with all the uncertainty that that creates in people’s minds and the regrettable boost which has been given to UKIP and its fellow travellers. Leaving to one side the question of a referendum, which I personally regret, the UK has to have a twin-track approach if there is to be anything approaching a successful outcome of any negotiation and subsequent referendum. To achieve the first, we have to be clear and realistic about what it is we seek to change. The Government’s review of competences will not be complete until the autumn of 2014. There have been press reports that at least two member states—France and Germany—have refused to contribute to the process. Is that correct? I do not expect my noble friend to disclose details of the observations of individual member states but can she indicate whether there have been any responses from anyone and, if so, the nature of those responses?
The Prime Minister is reported to have discussed the question informally with the German Chancellor. Have we already formed a view about what we seek to change prior to the outcome of the competences review and, if so, what is the point of the competences review? Are Ministers looking at matters which could be dealt with by an amendment of existing European legislation? This may be a more productive route and likely to find us more friends among other member states as opposed to treaty change. If we seek treaty change for our benefit, shamelessly exploiting the possible need for eurozone members to make changes for the economic governance of the eurozone, how will we prevent the other member states raising their own particular issues and how many will welcome that process being turned into a wholesale treaty review? Might they not prefer to come to their own arrangements not involving treaty change and, therefore, maybe not involving the United Kingdom? If substantial treaty change is in mind, how do the Government intend to achieve this between 2015 and 2017—the date of the promised referendum—bearing in mind the Lisbon treaty provisions regarding substantial changes?
For us to have influence within the European Union, whether in the Prime Minister’s promised renegotiation or generally, the atmosphere has to change. We must sound as if we want to remain members, recognise negotiations are negotiations, and bring an end to what I have previously described as the current attitude of preferred disengagement. Language and tone for those to whom it is directed and the climate it creates are extremely important.
We have talked of actively discouraging citizens of Romania and Bulgaria from coming here when they become legally entitled so to do. We have thereby created a climate whereby the desirability of having admitted citizens from other EU member states after 2004 is now called into question. Such careless language, which we would not use in respect of nationals of other countries outside the EU, does not win allies, especially when it appears to question one of the four fundamental freedoms of the Union. Can my noble friend state categorically that none of these freedoms is questioned?
The second track, which we must follow if we are to succeed in convincing our partners that we are in the Union for the long run and to win any referendum subsequent to renegotiation, is to put the case for membership unambiguously, enthusiastically and now. The Conservative Party must make it clear that we are not going to dance to UKIP’s tune. UKIP policy on Europe is not the policy of the Conservative Party. The Tory party must not allow itself to become an umbrella under which the otherwise unelectable articulate UKIP views. In passing, would it not be a good thing to change the system of election from closed lists to open lists so that voters who wish to vote Conservative may do so without having to vote for candidates who display Tory colours but UKIP tendencies?
If we are seen to put the case for Europe without threats of withdrawal, there may be a chance of achieving some successes and reforms that might resonate with other member states, and of winning a referendum. Failure to show our desire to be fully involved now and in the future can only reduce our influence to our own detriment.
Lord Davies of Stamford
My Lords, I congratulate the noble Lord, Lord Dykes, on securing this debate. He has been committed to this cause in all the long years that I have known him. He has shown great energy, commitment and often great courage in pursuing that cause. I have great pleasure in paying tribute to him today.
The most interesting thing about this afternoon’s debate is the people who are taking part. Where are all the leading Eurosceptics? Not one of them has turned up. We had a debate in this Chamber about a year ago and all of them turned up. I distinctly remember the noble Lords, Lord Lawson, Lord Lamont and Lord Flight, telling us how the euro was about to collapse and that they had been right all along because they had been saying for years that it was bound to collapse. I remember replying that they slightly reminded me of the Marxists of the earlier 20th century who, every time there was a recession said, “We were right all along; this is the final crisis of capitalism”. I am not sure they appreciated that analogy. They are not here this afternoon, which must be a very good sign as to progress in the European Union.
Of course, there is no disaster to gloat over. The latest news is actually rather encouraging. I am quite convinced that both the EU and the eurozone are emerging strengthened from the crisis. It has been very positive to get the growth and stability pact and to achieve the banking union. The handling of the Cyprus banking crisis has been extremely successful. We have established the principle now that there should be no bailout without a bail-in. We have established the principle that anybody who has more than €100,000 and wants to keep it all in one bank has some responsibility to take a view on the creditworthiness of that bank and, equally, that people who have less than €100,000 in deposits should be protected by public guarantees. All that has been very positive.
Of course, some of these things could and should have been determined well in advance, calmly, because rationally they were the sensible thing to do. But we all know that in human affairs people often only take the right decisions in a crisis. It is difficult to get people to make difficult decisions when things seem to be going well. These structural changes are a permanent legacy and a positive outcome of this crisis.
None of us has very much time to speak, but I do not think that there is an alternative to the EU for achieving what we need to achieve in this country on so many fronts—the environmental, economic, foreign policy and defence fronts. This is an area at which we desperately need to look very carefully now, because budgets are so constrained throughout the European Union: how can we best save money through greater degrees of co-operation, including defence specialisation? That is a very complicated matter and we must return to it on another occasion.
All parties like to say that they are taking a cool, calm, objective view of the national interest. But we must do so without prejudice. We must not reject a particular solution if it is actually in the national interest simply because it has the word “European” or “EU” attached to it. There is too much of that emotional counterreaction on the part of the Government at the present time.
I leave the noble Lord with one thought this afternoon. It is time for us to look pragmatically, coolly and calmly, without hysteria, at the possible advantages to us of joining the Schengen agreement. It would not merely remove a lot of the existing burden on the UK Border Agency, which we have seen so much of in the past few months, but it would address a much more serious problem. This country is losing hundreds of thousands of pounds, perhaps even millions of pounds a year, in tourism particularly from visitors from the Far East who tend to travel in groups. Their travel agents arrange a Schengen visa for them. They come to Europe and visit Amsterdam, they go down the Rhine and visit Paris, Rome and Madrid. They have a lovely time, but they never come here because we are not part of the Schengen system. It would involve additional delays and costs to get visas.
This is a major economic problem. The Government have always excluded even looking at Schengen simply because it is European. But if it happens to be the right pragmatic solution on the basis of the national interest, we should go along with it.
Lord Kakkar
My Lords, I, too, join other noble Lords in congratulating the noble Lord, Lord Dykes, on securing this important debate. I wish to confine my comments to an area where there have been unintended consequences of European legislation—in the delivery of healthcare here in our own country. This is a vital issue. As we move forward, there may be an opportunity for British people to become isolated because they feel that there is an impact on the delivery of healthcare that was unintended and is having a detrimental effect. Before doing so, I declare my own interest as Professor of Surgery at University College London, and as a member of the General Medical Council.
A number of issues have been raised with regard to European legislation and directives that relate specifically to healthcare. They relate to the area of professional qualifications and the free movement of labour within the European Union. There has been important progress with the issue of language testing. The General Medical Council, it is proposed, will now be allowed to test the language skills of all doctors who wish to be registered by the council in the future, including those who come from the European Union. That is an important achievement.
However, there is still concern about the ability to test professional qualifications and the nature and structure of the postgraduate training that has been delivered to healthcare professionals throughout the Union. This is an important issue because doctors coming from other parts of the world are subject to that kind of rigorous testing before they are allowed to join the register.
The issue that I would like to focus on is the European working time regulation. In 2010, when the coalition Government was formed, the then Health Secretary committed to begin negotiations with the European Union on ensuring that working time regulations could be applied in a more flexible fashion with regard to working in our hospitals to reflect the fact that the nature of the delivery of healthcare—the structure of our hospitals and broader healthcare environments—is somewhat different from other European countries, and a degree of flexibility would be important. I recall that the then Health Secretary and the Business Secretary were to commence discussions in January 2011 on this matter, but all seems to have gone quiet because of the broader review of competences that is currently taking place.
We need to be very sensitive to this issue. Recently we have started to see coroners’ narrative verdicts starting to cite European working time regulations as a contributory factor in patient death. We have seen in the Francis report into the problems that were experienced at Mid Staffordshire hospital that the working time regulation was identified as a potential contributor to an inability to provide continuity of care within the hospital system. These kinds of descriptions in coroners’ verdicts and in important reports, such as the Francis report, can cause unnecessary anxiety.
With increasing pressure in the healthcare system, we need to be sensitive to problems identified by, for instance, the Royal College of Surgeons, which estimates that 400,000 surgical hours a month are lost from the healthcare system as a result of the application of the working time regulation to surgical rotas and that some £750 million a year is now spent on locums to ensure that locum doctors can fill gaps in those rotas. Equally, the Royal College of Physicians has identified this whole area as a major issue for the delivery of healthcare.
Therefore, I should like to ask the Minister what progress is being made with regard to the discussion about the working time regulation. This was identified as important on the basis of patient safety and the need to ensure continuity of training to a high standard for our trainees, who will lead the healthcare system in the future. It seems to have become mixed up in the broader question of competences and of bringing them back from Europe. If this issue is not addressed, there could be major problems in the future that will be attributed to it and this could have a detrimental impact on the public perception of Europe, because health was never an issue of competence and this matter is specific to the delivery of healthcare in the United Kingdom. Is the Minister able to guarantee that this important discussion, which started long before, will be continued in a timely fashion?
Baroness Coussins
My Lords, one of the underlying causes of the UK’s isolation in the EU is our lack, as a nation, of the foreign language skills to enable us to participate fully and to derive the full economic, cultural and educational benefits from membership. I declare an interest as chair of the all-party group on modern languages.
There are three main ways in which our language skills deficit is damaging. The first is in terms of influence. The Foreign Office itself has noted that a shortage of British staff in international institutions is detrimental to the national interest and undermines our policy influence. UK nationals make up only 5% of the European Civil Service, although we are more than 12% of the population. In 2011, a mere 2.6% of applicants were from the UK—fewer than from any other member state—and a key reason for this was that English-speaking applicants must offer either French or German as a second language.
Secondly, poor or non-existent language skills prevent UK nationals taking advantage of labour mobility within the single market, while of course leaving them open to competition from incomers. UK employers are dissatisfied with the language skills of British graduates and end up recruiting far more multilingual graduates from other EU countries than employers from any other member state. Although this shows that the single market is working well in terms of the free movement of people, British workers are limited in their ability to take advantage of this freedom in the opposite direction.
This is, of course, linked to export growth. The Department for Business, Innovation and Skills noted recently that the proportion of the UK’s exports to the other 26 member states is falling and now stands at less than 50%. A considerable body of evidence now links export growth to languages. Business leaders say that it is language availability that drives export decisions, not market strategy.
Finally, UK participation in EU mobility programmes is worryingly low, yet this is what equips people with the skills to work across borders. In 2011, more than twice as many French and nearly four times as many Germans took part in work experience placements within the EU. UK university placements under the Erasmus programme are around one-third of those of France and Germany.
To sum up, we are barely present in the EU administration, our students are keeping themselves to themselves, and trade with other member states is in decline.
While I warmly welcome the fact that the Foreign Office has recognised the importance of languages in diplomacy by increasing its budget for language training and the number of posts for which languages are now regarded officially as an absolute requirement, I should like to ask the Minister two questions. First, what specific action will be taken to increase the number of UK nationals able to compete successfully for positions in the European Civil Service? Secondly, given that our language deficit is the concern of so many different government departments, will she undertake to discuss with colleagues and with No. 10 the value of appointing a single government Minister to have cross-departmental responsibility for a co-ordinated policy on foreign languages? Without a step change in our language skills, we will continue to compound our isolation within the EU and be unable to play a full role in the formulation of strategy and policy.
Lord Giddens
My Lords, like noble Lords here present, I have been travelling widely across Europe over the past few months and talking to a range of political leaders and academics. My reading of the situation with regard to the UK is a bit different from that of other noble Lords who have spoken because I think it is much more serious and difficult for Britain than we imply from the speeches that have been given hitherto. Being an academic, I shall express this in terms of a number of steps of reasoning and ask the Minister to say where the flaw in the argument lies because I do not see one.
It goes in seven quick steps: first, the economy of the UK is heavily dependent on that of the wider European Union and there is no chance of diminishing that dependency in the short term. Secondly, saving the euro and returning the eurozone to prosperity is of key importance to a stable future for the EU and hence to the UK’s economic fortunes. The collapse of the euro would have catastrophic consequences for all of us. Thirdly, the euro cannot be saved without greater European integration, including, at a minimum, some form of banking union in the eurozone and, almost certainly, some sort of loose federation for the EU as a whole down the line. Fourthly, you cannot have greater integration and variable geometry at the same time because they are mutually exclusive. This is the reason why our normal allies, such as the Danes, gave such a tepid response to the Prime Minister’s speech in January. Fifthly, the chances of treaty change along the lines the Prime Minister wants to produce are therefore, to my mind, pretty close to zero. The main reason is that they are simply in the opposite direction to that in which Europe has to travel if the eurozone is to be saved, and the eurozone must be saved; at least, it must be stabilised in the short term as a minimum. Sixthly, hence, if by some miraculous happenstance the Government win the next election, the Prime Minister will be forced, when a referendum is called, to campaign for a no vote. Seventhly, since the Prime Minister says that he wants the UK to stay in Europe, this outcome can be described in Shakespearian jargon as:
“Hoist with his own petard”.
Baroness Valentine
My Lords, it is difficult to follow that. The question of this debate takes as its premise that UK isolation is a bad thing, but is that the case? In my role as chief executive of London First, I talk to many business people who have given serious thought to how a UK that is not part of the EU might fare. Some point to our historic success factors—an open business culture, our time zone, English law and the English language—none of which comes from Europe. They question whether our membership really makes it easier to do business in Europe than with, say, Norway. Further, they argue that our focus should be on the emerging economies. Others challenge the assumption that leaving the EU would damage London’s role as a financial centre. Supposing the EU were, in effect, to shrink to the eurozone, a new European financial centre would almost certainly emerge, but with an inward-looking focus, and meanwhile the UK would expand its global financial role.
However, it seems to me that these views merely represent pragmatic ways of dealing with a situation that few would actually welcome. Certainly, business people complain about red tape and employment law emanating from Brussels, but of those multinational companies that I speak to, not one has advocated divergent regulation within Europe. Furthermore, they understand the logic of negotiating global free trade agreements from a base of 500 million people rather than 60 million. While the need to shore up the euro necessitates reviewing relationships in Europe, I have yet to meet a senior business figure who would actively have sought a referendum at this time.
Continental Europe remains a major trading partner for the UK. We must value and respect that relationship. Let us not forget that for many companies, whether British, Asian or American owned, London is the location of their European head office. Any suggestion that the host country is at odds with other countries in the region is clearly unhelpful.
In financial services, what Europe needs is a financial centre which is competitive with the Americas and Asia. What the UK needs is friends to make that point, rather than enemies who resent the Anglo-Saxon business model. This is about tactics in Europe as much as whether one is a Europhobe or a Europhile. Some countries may wish to see London lose its position but there are also European firms and member states that value having globally competitive capital markets within our time zone. Certainly, tactically, it is not clever for the Chancellor to be voted down 26 to 1 on bankers’ pay, whatever way you look at it.
Therefore, my plea to government is not to risk vital relationships with political posturing. The only way to improve the relationship with Europe is to put two feet firmly inside the tent, identify allies and commit wholeheartedly to making the Union work for everyone’s benefit.
Lord Judd
My Lords, the noble Lord, Lord Dykes, serves us well and may he long continue to do so.
The first reality for all of us in Britain is our total interdependence with the world as a whole. We fail the electorate, we fail our children and we lamentably fail our grandchildren unless we take every opportunity to bring that home. Since we last debated this issue, the realities of interdependence have become more underlined than ever. The economic crisis continues, the euro crisis—with all its implications for us as well as for everybody else—is still there, and of course this is complicated by the emergence of south Asia and China as increasingly significant economic realities.
Global security is challenging. There is Syria, the Arab spring with all its implications, the Korean peninsula and more besides; there is climate change, which is not unrelated to the issues of migration, which are immense; and then, of course, there are crime and terrorism. One of the things that we all have to face is that significant crime and significant terrorism are, by definition, international in character. None of these issues can be satisfactorily resolved for the British people by Britain on her own. They all require constant, growing and effective co-operation.
Sub-Committees E and F will produce their report this week. I declare an interest as a member of Sub-Committee F but I commend the report to all members and take this opportunity to thank the noble Lords, Lord Hannay and Lord Bowness, for their outstanding leadership in chairing those two committees. I also commend the evidence because there has been a real attempt to keep the report of those committees evidence-based. One should read that evidence. All the people involved in the front line in fighting international terrorism and crime are saying that it would be madness at this stage to pull out from the closest possible co-operation which is developing so well within Europe.
I conclude by simply making this point. In the aftermath of the Second World War, in those very difficult situations our leaders across the political divide recognised that our future lay in the future of the world, and they became central to the building of viable, relevant international institutions. This was as true of the Conservative leadership at that time as it was of the leadership of my own party. What has happened that we have lost sight of that reality? The challenges today demand that same vision. Of course, there are weaknesses and huge flaws within the European Union, but those are best tackled by a Britain that is seen to be relentlessly committed to its involvement and belonging to the international and European community, not by a Britain that neurotically and negatively constantly undermines the European cause. I thank the noble Lord, Lord Dykes, most warmly and hope that he will continue to keep us up to the mark on scrutiny on this issue.
Lord Hannay of Chiswick
My Lords, it would be idle to pretend that Britain’s always turbulent relationship with the other member states of the EU is not currently going through a more than usually troubled phase, and for that reason, I thank the noble Lord, Lord Dykes, for his initiative. The misguided attempt to veto a fiscal union treaty in December 2011, the balance of competence review, whose purpose often seems obscure to its authors, let alone to most of the other member states which treat it with deep suspicion, and the Prime Minister’s reckless commitment, in my view, to an in/out referendum in 2017 all contribute to a negotiating climate that could easily end up negating the objective of establishing a more settled relationship for a Britain firmly engaged as a full and fully participating member of the European Union.
How is such an outcome, which would be so damaging to Britain’s national interest, to be avoided? First, we certainly cannot afford to sit around waiting until we see the result of the 2015 general election before embarking on a process of reform. Nor can we afford to found such a process on the entirely false premise that the other member states, particularly the members of the eurozone, are poised to embark on an overall rewrite of the treaties, which would provide the opportunity for us to put forward a wish list of our own. That will simply not happen any time soon, and certainly not in the timescale envisaged by the Prime Minister. Nor can any such process of reform afford to be based on a purely British list of vetoes, red lines, no-go areas, items for repatriation or renegotiation. We need a positive reform agenda which takes proper account of the wishes and interests of other member states, and thus has some chance of enlisting their support. That positive agenda needs to enlist cross-party support in Britain; it must not be a ragbag of items designed to appease the unappeasable in UKIP and the wilder shores of Euroscepticism, neither of which forces has the slightest interest in an approach that would leave Britain inside the European Union.
Can such a reform agenda be put together? I believe that it can but it would need to move beyond the comfort zone of Britain’s traditional EU agenda—completion of the single market, with stronger provisions on services and a digital market, further enlargement and freer and fairer world trade, valuable though those components continue to be. It will need to include a more wholehearted embrace of a common foreign and security policy and it should surely include, too, some strengthening of the common security and defence policy to face up to the impact of austerity on defence budgets. It should be focused on policy reform rather than on institutional reform. There will, of course, need to be some areas of increased flexibility in the operation of an EU moving beyond the soon-to-be 28 member states. Variable geometry is alive and well—here I rather disagree with the noble Lord, Lord Giddens —and has been operated successfully in Brussels since the end of the 1980s. We need only look at Schengen, the eurozone, justice and home affairs opt ins and opt outs. There will probably need to be more of that as the eurozone moves to a more integrated economic and monetary union within a European Union where there is still likely to be a substantial number of member states not yet within the eurozone, nor likely to be so in the near future. What needs to be avoided is making such a variable geometry the main operating principle of the European Union—that would be to sound the death knell of the single market; and to avoid, too, any fixed group of inner and outer circles of member states, which would be inherently unstable and unsustainable. It makes no practical sense anyway, as Britain is an essential leading player in any strengthening of common foreign security and common defence policy.
If I had one immediate plea, it would be for the Government to jettison their silly and untrue slogan of wanting less Europe—untrue because the Government’s policy is for more single market, more European trade agreements, and more new members of the European Union. Who are they kidding? The slogan is silly and counterproductive because it separates us from our natural allies in Germany, Sweden, the Netherlands, and in central and eastern Europe, who will never march into battle under the banner of “less Europe”. Shaping and beginning to negotiate with our partners and with the Commission over such a positive reform agenda is the right way ahead, and a far better option than preparing to play a game of Russian roulette in 2017.
Lord Jay of Ewelme
My Lords, it is perhaps worth remembering that the EU has three great achievements to its credit: it brought cohesion to western Europe after World War 2; it provided east and central Europe with a democratic home after the collapse of the Soviet Union; and it has created an almost but not yet complete single market of some 500 million people. All those greatly benefit Britain and the rest of the EU. The second and third of those owe a great deal to the influence exerted by successive British Prime Ministers and Governments, including on enlargement, and here I differ slightly from the view of the noble Lord, Lord Dykes and of Lady Thatcher.
The EU now has no such great forward-looking project. Indeed, in creating the euro, it has created huge, although not—and I agree with the noble Baroness, Lady Valentine—insurmountable problems for itself, brought on and exacerbated by the financial crisis. I believe we were right not to join the euro, but we also benefit hugely from the single market of 27 member states. Therefore, our interest as a nation surely lies in the maintenance of a coherent European Union of 27 or 28, with the euro at its core and the single market intact. That is easy to say but it is not a straightforward goal to achieve. There are strains between the eurozone and the rest, and within the eurozone, not least at present between Germany and France. Achieving that goal, crucial to our interest, will require patience, determination, tough negotiations and compromise, because negotiations always do require that. It will, above all, require maximising our influence, which we should never underestimate.
I do not believe that the noble Lord, Lord Birt, and I can be alone in hearing from business colleagues and others in Paris and elsewhere in the EU that Britain’s traditions of a liberal market economy, an international outlook and democratic strength are really needed in the EU, and the more the EU is in difficulty, the more, frankly, those qualities are needed. I fear, however, that we are also not alone in sensing that some at least in the EU seem increasingly to have given up on us, sensing that there is no longer a commitment in Britain to the European Union at a time when our contribution in our own interest, as well as in the interest of the European Union, is so important. That conclusion is wrong but I understand why they have come to it.
I end by looking on the bright side. I was delighted to see the Prime Minister and family spending time with Chancellor Merkel. I am delighted to see too that the Chancellor of the Exchequer played down the rhetoric of his opposition to the financial transaction tax, focusing instead on the British interest in opposing it. That, surely, is the way to promote our influence and our interests: state clearly our commitment to an EU of 27; establish close links, including at a personal level, with the key member states; and in that framework fight hard for British interests. As it is sometimes said, if you are not at the table, you tend to be on the menu. I know which I would rather be.
Lord Liddle
A lot of the speeches we have heard in this excellent debate seem to make an assumption that David Cameron is going to be Prime Minister after 2015, and that therefore the referendum promised for 2017 is going to take place. In my four minutes, I shall briefly set out what I think a Labour-led Government should do.
One assumption lying behind our present predicament is that, because of the euro crisis and the presumed strengthening of integration that has to go with it, Britain is condemned to be on the fringes of a much more integrated eurozone and therefore can no longer aspire, as Tony Blair’s Government certainly aspired, to play as leading a role in Europe as France and Germany. I think that that assumption is flawed. I am sceptical about whether the steps necessary to save the euro require the creation of an inner core federal Europe. That argument is overdone. I also believe that there are policies that a Labour Government could advocate which would put it right at the core of Europe.
The key thing is that we present a positive vision for the future of the EU, as the noble Lord, Lord Hannay, and others, have said, which suits our national interests but can win support from our partners. There are three key elements to this. One is to have a plan for growth, so that it is pro-reform and pro the single market—and we have talked about extending it in digital and services—but also anti-austerity, and trying to get out of the trap of collective austerity in which Europe has put itself. There is an instrument, for instance, in the European Investment Bank, which could be greatly expanded to deal with that problem.
Second is the need to demonstrate the role of the European Union in tackling the big long-term challenges that all our European societies face, including innovation, climate change, demography and inequality. On innovation, we should be pressing for more co-operative research. On climate change, there is an urgent need to do something about the minimum carbon price. The failure in the European Parliament last week was extremely significant. We cannot have a credible national climate change policy without a complementary European policy. On demography, we should be talking about how we manage the challenges of migration, rather than making cheap points about benefits to Britain. On inequality, we should look again at how we use European legislation to strengthen a more Germanic model of responsible capitalism.
Thirdly, there is the crucial role that the EU can play in the world. We heard a lot in the aftermath of Margaret Thatcher’s death about how she put the “Great” back into Britain. But given that we account in our changing world for about 2% of world GDP, which will be our position in about 10 years’ time, the idea that Great Britain can on its own influence the world is for the birds. We have to do it through the European Union; that is the only way in which we can protect our essential values and interests, and that is what I believe a Labour Government would try to do.
Along with that would have to be sensible institutional reforms. A belief in a stronger EU in some areas is not an argument for a more centralised EU. Powers should flow in both directions—the Prime Minister is right about that—and we should look at the present acquis to see what can be got rid of, as well as arguing for political reform that makes Brussels more accountable both to the European Parliament and to national Parliaments. But the fundamental point is that this has to be an agenda of reform, not of unilateral negotiation of some special deal for Britain, which is really a blind alley.
I shall finish by asking the Minister two questions. Will she take this opportunity to rule out once and for all on behalf of the Government that there are any conceivable circumstances, if they should be in power after the next election, in which they would recommend withdrawal from the EU in a referendum? Do they agree that the task is to forge an agenda of reform with our partners and not to draw up a list of unilateral demands?
The Senior Minister of State, Department for Communities and Local Government & Foreign and Commonwealth Office (Baroness Warsi)
My Lords, I congratulate the noble Lord, Lord Dykes, on securing this important debate. Our discussions on this subject are timely as the Government continue to work effectively with partners across the EU to agree on practical, pragmatic reforms that are good for the UK and the European Union. I hope that the noble Lord, Lord Liddle, realises that in that statement I have probably answered his second question.
My noble and learned friend Lord Howe of Aberavon is right to say that the UK needs a positive vision. I believe that we have one. The Prime Minister has set out his vision for keeping the UK at the heart of a reformed EU. It is a vision of a more competitive, adaptable and flexible EU with a strong mandate from the citizens of the EU. I thank the noble Lord, Lord Birt, for his positive comments and assure him that the Prime Minister’s approach is one of reform and commitment, not of obstruction and exit. Unfortunately I disagree with much of what the noble Lord, Lord Hannay, said, but I can assure him that policy reform is a key element of the Prime Minister’s speech, and I agree that the European Union is about much more than just a single market. There is more that we can do to make the common foreign and security policy more effective and to step up the agenda on enlargement, trade development and other matters.
The noble Lord, Lord Jay, referred specifically to a coherent EU of 27 members. I believe that the Prime Minister has set out his vision that tries to address that, based on boosting the competitiveness of the EU as a whole and ensuring fairness for those inside the eurozone and also for those outside it.
I shall return to the original question raised by the noble Lord, Lord Dykes. His question is quite clear; I want to be equally clear in my response. The UK has not been, and is not, isolated in the European Union. The proposals the Prime Minister has set out for reforming the EU ensure that this remains the case. This view is shared by others. The responses of many of our European partners to the Prime Minister’s speech in January acknowledged the key role the UK plays in the life of the EU.
Many also agree on the need for reforms: countries such as Portugal, Sweden, Austria and Estonia have all said so recently. The Netherlands, Finland, Hungary, Portugal, Belgium and the Czech Republic have all said that they too want a more flexible, diverse and democratic European Union. The Prime Minister of Italy at the time, Mario Monti, said he shared the Prime Minister’s opinion that prosperity and growth must be Europe’s priority. Noble Lords can see that the idea of the UK being isolated from partners such as these who are on the record as agreeing with the importance of our reform agenda does not stand up to scrutiny.
The supportive words of our European partners are valuable, but I want to talk about actions, not words. I ask noble Lords whether an isolated member of the EU could achieve the scale of progress we have recently achieved in reform-focused decisions across so many EU policy areas. The Government have, as usual, been busy, influential and successful. Let me share with you some examples. The noble Baroness, Lady Quin, asked specific questions on policy areas, and I hope that some of these examples will answer those questions. Last December, we worked with partners such as France and Germany to secure an agreement on banking union which preserved the integrity of the single market. In February this year, we led efforts to finalise a deal on a unified patent court which will reduce costs for businesses and encourage innovation. Just last month, we worked with other states including Denmark, Germany, Sweden and the Netherlands to abolish the policy of discarding caught fish as part of a wholesale reform of the common fisheries policy.
We delivered the first ever cut in the multiannual financial framework. This is an excellent example of how we have worked with our European partners. Few were happy with the idea of reducing the budget when we started negotiations, but we worked hard to form a coalition and persuaded all member states to agree a good deal for European taxpayers. In the European Union, you cannot reach agreements like those with 26 partners if you are unsupported and isolated.
The EU and the US recently announced their decision to pursue negotiations on a free trade agreement. It is influential member states such as the UK which drive this process behind the scenes. Such agreements are of critical importance to growth and prosperity across Europe and the United Kingdom.
In 2011, we concluded a free trade agreement with South Korea. Last year, we reached agreement with Singapore. This year, the UK is continuing to play its usual leading role as we come close to concluding talks with Canada. If we completed all of the negotiations on agreements currently on the table, it would be worth an additional €60 billion for the EU every year, according to the European Commission. From free trade to fisheries reform, from banking union to bailout rules, we continue to agree sensible changes to benefit the UK and the European Union.
The noble Baroness, Lady Quin, raised the specific issue of banking union, as did other noble Lords. Our key objective is to gain member states’ support that no banking union measures harm the unity and operational integrity of the single market. Banking union is a single currency and not a single market issue. As the UK is not a member of the eurozone, we have been clear that the UK will not participate in the sharing of eurozone risk or the new supervisory system. However, while it is for those who will join the banking union to design the framework, the UK will continue to play an active role during negotiations to ensure that the operational integrity of the single market is protected.
The noble Baroness also raised concerns that the Government are in the minority on the issue of bankers’ bonuses. This is clearly a very politically sensitive issue within the European Union at the moment. This made the debate very difficult. We voted against Capital Requirements Directive IV. Obviously we are not satisfied with the outcome. We have argued that the agreement on remuneration will have an adverse effect on financial stability. But this should not obscure the fact that many aspects of the agreement represent a positive achievement for the UK such as on higher prudential standards and the treatment of investment firms.
The right reverend Prelate the Bishop of Exeter asked, “Is this reform or repatriation?” as detailed in the Prime Minister’s speech. I can assure him very clearly that this is reform. The Prime Minister’s speech does not mention the word “repatriation”. We all need to help re-engage what the European Union means to European citizens and what citizens want. He also spoke about the common good and not to lose the soul of Europe, but I am sure he would agree that we will lose the soul of Europe if the current democratic deficit is not addressed. I hope that he and the church will feed into the balance of competences review.
My noble friend Lord Bowness referred to the balance of competences and to France and Germany’s contribution. The balance of competences review will give us an informed and objective analysis of the UK’s relationship with the European Union. Several foreign partners have already responded in the first semester along with a number of international organisations. Ultimately, the analysis will be focused on what the EU means for the UK and our national interest. We have already received 500 pieces of evidence and we will publish the full list of those who have fed into the review when the first reports are published in the summer, later this year.
The noble Lord also raised issues about UKIP and Conservative candidate selection. My views on both are on record from when I was party chairman.
The noble Lord, Lord Kakkar, raised some very specific issues in the area of health. I hope that he, too, feeds into the first semester of the balance of competences review, which reports in summer later this year. But in relation to the specific issue about the working time directive, the coalition Government have committed to seek to limit the application of the working time rules. We are continuing to work with EU partners whose votes we need to bring this about.
A question was raised in relation to Schengen. The UK already participates in some parts of the Schengen acquis where it makes sense, such as co-operation in managing borders. However, I can assure noble Lords that in 2012 more than 31 million people visited the UK, according to VisitBritain. The noble Lord, Lord Bilimoria, referred to the Business for Britain campaign, which called for a national drive to renegotiate the terms of Britain’s membership of the European Union. I welcome his contribution and the contribution of that campaign on how the UK can continue to be an active member of a reformed European Union. The voice of business is essential to that debate.
The noble Lord, Lord Dykes, referred to our opt-outs on the JHA in 2014. Discussions are ongoing and we have committed to a vote in both Houses, which will take place in good time. Of course, the national interest will be a key factor in deciding which measures we agree to rejoin. The noble Baroness, Lady Coussins, referred to foreign languages. This has been a longstanding issue and we recognise the importance of increasing UK nationals in EU institutions. We have reintroduced language training and indeed, the language school at the Foreign and Commonwealth Office. We have also supported the European fast-stream work and foreign languages in curriculums in schools.
The noble Lord, Lord Giddens, set what seemed like a series of undergraduate questions. He was clearly back in academic mode and I quickly went into undergraduate mode, with sweaty palms, and realised that I had not crammed enough to answer his questions, but I will try to answer them in writing. The noble Baroness, Lady Valentine, stressed the importance of EU free-trade agreements and trade with Europe. The Prime Minister has been very clear that the UK’s national interest is best served as an active member of a reformed EU. We seek reform of the EU for the benefit of all member states, and many European partners agree with us. I fully agree with the noble Baroness on the importance of the EU concluding free-trade agreements, and the Government are actively supporting an ambitious programme.
The noble Lord, Lord Judd, raised the issue of common security and defence policy. The UK has successfully driven common security and defence policy in the EU and we have made it a useful tool for delivering British objectives, whether in the Horn of Africa or the West Bank, and whether it was to improve policing in Palestine, Kosovo or in Georgia, British personnel were in key positions of influence and multinational efforts to help local populations deal with the legacies of conflict. The noble Lord, Lord Judd, also realises that there are flaws and weaknesses in the system, and it is those that we are attempting to deal with, and what the Prime Minister attempted to deal with in his speech.
This has been a thoroughly interesting debate and I thank the noble Lord, Lord Dykes, for giving us the opportunity to examine the issues once again. I thank all noble Lords who have contributed from across the House. As with all matters on Europe there is a full spectrum of views and opinions about the fundamental principles of the debate, but the noble Lord, Lord Dykes, talked about steps taken. In the snapshot of the most recent events I have given today, I hope that the facts speak for themselves, but this is not just about what the European Union is doing now; it is about what the EU wants to do as part of the future. The Prime Minister started the debate in January and it has aroused healthy discussions. We do not deny that there is a range of views across Europe; it would be odd if there were not, but I hope that I have made it clear that this Government dispute any notion of UK isolation. We will continue to put the case to our partners and continue to deliver changes to encourage growth now. We will continue to lead the wider debate on reform to secure long-term prosperity in the United Kingdom and the European Union.
Lord Bowness
Before the noble Baroness finishes, I have two specific questions which she did not deal with. Will she repudiate the policy advocated by UKIP of leaving the European Union and will she commit the Government to a categorical support of the four freedoms, to which I referred in my speech?
Lord Giddens
Mine were not undergraduate questions but Socratic propositions.
Baroness Warsi
On the question asked by the noble Lord, Lord Bowness, the primary supposition is very clear. It is very apparent that the Conservative Party’s policy is one of renegotiation. In my last job I spent many hours touring the country speaking to Conservative members. When I asked them whether they wanted out, in as it is now or renegotiation, more than 90% always went for renegotiation. That is the Prime Minister’s position and I hope that it is clear.
Energy: Nuclear Power
Viscount Hanworth
To ask Her Majesty’s Government what is their assessment of the role of nuclear power in helping the United Kingdom to meet its climate change and energy security goals.
Viscount Hanworth
This is a timely debate, which comes some time in advance of the introduction to the House of Lords of the Government’s Energy Bill. We are eager to discover how, in truth, the Government foresee the future provision of electrical power in the UK. We should like to know what steps they intend to take to secure our future supplies of energy if the optimistic scenario that they have depicted in recent documents fails to materialise and if the commercial providers are not forthcoming. I should like to put this question to the Minister.
There is already a plethora of printed information from which one might seek some enlightenment. In March, a flurry of documents emanated from the Department for Business, Innovation and Skills and from the Department of Energy and Climate Change. Some of these documents contain new information, but much of their material is already familiar from previous publications. These documents seem to indicate a strengthened commitment to a nuclear future. Nevertheless, they do nothing to dispel the doubts about this future.
One of the most significant of the recent publications is the so-called Beddington report, A Review of the Civil Nuclear R&D Landscape in the UK. This report, which has been conducted by the Government’s Chief Scientific Adviser, represents an independent appraisal. The Beddington report amounts to an inventory of our existing research facilities. It has revealed some serious lacunae.
Another enlightening document is a report of the Energy and Climate Change Committee of the House of Commons, Building New Nuclear: The Challenges Ahead. Here, one will find a full expression of the doubts and anxieties concerning the nuclear programme and the energy policy of the UK in general. This document, which comes in two volumes, contains the brief and cogent report of the committee, together with a mass of oral and written evidence from numerous parties. It is to this report that one should go to discover the realities of our situation, which are in contrast to the optimistic aspirations of the Government.
The doubts that affect the Government’s programme arise mainly from the fact that it persists in seeking a wholly market-based solution to the energy problem. Their stance implies that they will have a limited control over the outcome, unless there are contingency plans for the eventuality that the markets will fail to deliver what is required. As the Commons report asserted, there is no evidence of any such contingency plans and it is likely that the markets will fail to deliver.
It is also clear that, in the absence of a successful nuclear renaissance, the UK will fail to meet its commitments, proclaimed in the Climate Change Act 2008, to stanch its emissions of carbon dioxide. According to existing plans, which have been influenced by our climate change commitments, the UK will lose in the coming decade about a quarter of its coal-fired power stations. We will lose all of the old oil-burning plant. We will be losing most of the existing nuclear plant, which consists of the eight advanced gas-cooled reactors and the one pressurised-water reactor, Sizewell B. This is the only current reactor that will still be operating after 2023. That is the reality of the energy gap, which the Government are hoping that the private sector can be induced to fill.
What we will be left with, in the absence of new nuclear plant, is an electricity-generating sector dependent almost entirely on gas and wind power. This assumes that the UK would continue to fulfil its climate change commitments. In such circumstances, the UK will be faced with the choice between breaking those commitments or suffering an even more severe dearth of energy supply.
One might look to the obiter dicta of some of the Ministers to discover what the Government really intend. We know that the Chancellor of the Exchequer, George Osborne, has been vocally supportive of the UK’s shale gas industry, arguing that this prospective energy source could be a cheap and secure way of meeting the country’s energy needs, as ageing power stations are decommissioned. However, most experts have doubts regarding the extent of the shale gas in the UK and its accessibility and they point to the environmental damage that would arise from its extraction. If the UK were to depend on gas, it would need to be imported from abroad. The global supplies of gas are limited and are liable to be pre-empted by other nations that have forsworn the use of nuclear energy. The supplies of gas from abroad will be both insecure and expensive.
Another possibility for filling the energy gap, in the absence of nuclear power, would be by burning coal, which nowadays the UK imports in large quantities. Some people have been able to imagine that this would be an acceptable recourse, if it could be accompanied by the as yet unrealised technology of carbon capture and storage. This technology appears to be a fantasy and the prospect of continuing to rely so heavily on coal fills all but the most ardent climate change sceptics with horror.
Finally, there is the suggestion that, in the absence of nuclear power, we could rely on wind power and wave power, on biomass energy and even on energy abstinence. The supply of biomass is limited and its burning is highly polluting. The energies of the wind and the waves are intermittent and they have to be accompanied by other sources of power to meet the base-load requirement. These renewable sources can play only a marginal role. Moreover, when the full costs of renewable energy, including those of the base-load provisions, are taken into account, they are seen to be exorbitant.
Now I must explain why the Government’s intention to achieve a nuclear renaissance by means of free market enterprise seems so improbable. For a start, one can point to the fact that no commercial supplier has yet given a firm commitment to build nuclear plant in the UK. A significant number of prospective suppliers have already withdrawn. One should also note that there are no other examples of nuclear power stations that have been constructed without the major involvement of a national Government. A new nuclear power plant has a life expectancy of 60 years. Ten years can pass from the initiation of a nuclear project, when the first expenses arise, to its completion, when the revenues begin to flow. Seventy years hence is way beyond the horizon of any commercial enterprise.
The logic of commercial project appraisal depends on a rate of discount that is applied to future earnings and diminishes their present value as they recede into the future. The commercial rate of discount obliterates the value of future earnings to the extent that no enterprise would undertake investment in such a long-term project as a nuclear power station unless it was heavily subsidised. Nuclear power is virtually incompatible with private enterprise. At present, the only realistic hope for a new nuclear plant in the UK is one that would be constructed by what is essentially a state-owned enterprise, namely EDF, or Électricité de France. The heavy subsidy that EDF can expect to receive is largely on account of the high cost of the alternative sources of power with which nuclear energy would be competing. Even so, it is unclear that this would offer a sufficient inducement for it to bear the risks of such a project.
What should the Government do in the face of the eventuality that commercial enterprises will not be prepared to undertake the building of the much needed nuclear power stations? The answer is that the Government should commission and finance the projects directly, as has been the case invariably in the past. By financing the projects directly, the exorbitant costs of the risk premia that are demanded by the financial markets would be avoided and the benefits would accrue to the public.
The Government should not allow themselves to be hamstrung by an atavistic free market ideology. Nor should they be obsessed by the totem of their nominal borrowing requirement. If the Government can afford such massive financial quantitative easing as we have witnessed recently, surely they can afford to finance our energy future. I earnestly hope that the Government have a contingency plan and that it is one that is dictated by common sense.
Lord Jenkin of Roding
My Lords, in my three minutes I really only want to make one point. The assumption behind all the documents published last month was that nuclear energy is going to have to play a major role in the low-cost, low-carbon supply of energy to this country. Of all the reports that were published last month, may I express particular enthusiasm for what the noble Viscount has called the Beddington report, namely the report about the response to the Lords report on nuclear research and development? The other report, on strategy, is also extremely positive and forward-looking. With it, we also have the road map reports, something that the Select Committee called for specifically.
Together, these reports should now provide Ministers with all the guidance that they need on how to ensure that the UK nuclear industry can achieve three things. First, nuclear power should play a long-term role over the decades ahead in providing security, which the Question refers to, and a low-carbon source of electricity. Secondly, by expanding focused research on new technologies, the UK should be able to rebuild its leading role in global nuclear development, something which again the Select Committee looked forward to. Thirdly, the reports should enable the UK industry to become a major nuclear exporter to the rest of the world. These things are all spelled out in the documents with great clarity, certainty and force. I do not share the pessimism of the noble Viscount.
With regard to the Ad Hoc Nuclear Research and Development Advisory Board, I give full support for all 12 recommendations. However, I would like to ask my noble friend just two questions. The first concerns the role of the National Nuclear Laboratory, about which we had a great deal of evidence in Select Committee. When will Ministers be able to announce details of the proposed new structure and role of the laboratory and the details of the programme referred to in the report? There is also recognition that extra funding will be needed. We know that this cannot come from DECC, because it does not have any money, but BIS does. It is, in a sense, the research department. Therefore, I hope that we can look forward to the funding necessary to deliver the programme spelled out in the report.
The second question relates to one of the four areas of opportunity set out in the Nuclear Industrial Vision Statement, which refers to “nuclear fuel cycle services”, where the UK,
“could expand its international market share in current fuel supply and spent fuel management”.
There has been a lot of publicity about the future of URENCO, with the suggestion that the Government may be willing to sell their one-third share in it. That is inconsistent with what I have just read out from the report. Could my noble friend give us any further information about that?
Lord Giddens
My Lords, first, I congratulate my noble friend Lord Hanworth on having initiated this debate. Three minutes on nuclear power is not very much, so I am going to limit myself to three questions to the Minister.
First, exactly what lessons have the Government learnt from the notorious examples of the Olkiluoto plant in Finland and the Flamanville plant in France? Both, as everyone here will know, have been subject to horrendous delays and cost overruns. With Olkiluoto, the whole process was initiated in 2000 and the plant was supposed to come into service in 2009. However, the date now given is 2015 and we do not know whether that will be achievable. The project is billions of euros over its original estimated cost and an unseemly squabble has broken out over who will pay the difference. How are the Government setting out the lessons to be learnt so that we can avoid those outcomes?
Secondly, even if built more efficiently, the reactors planned by the Government will take many years to come on stream. The level of technological innovation in the energy sector is now very high—much higher than it was a few years ago. What will prevent the reactors becoming expensive white elephants? The report sent to the Government by their three main scientific advisers proposes the development of fast reactors using nuclear waste as a power source, thorium reactors and perhaps nuclear fusion. I would support all of those, but how will such development be carried out alongside the building programme and who will pay?
Thirdly, what is the Government’s latest position on the convoluted issue of subsidies, which seems to run and run? As I understand it, the Government are no longer sticking to their position that nuclear investment could go ahead only if there were no subsidy. I do not know anyone working in or around the industry who ever thought that that was possible. Does the Minister agree with the calculations of the energy analyst Tom Burke, who has mounted a series of attacks on government policy? According to him, if the strike price at Hinkley Point was just under £100, the constructors would receive something like a £50 billion subsidy from the Government if the contract were for 40 years and the market price averaged £50 to £60. Does the Minister agree with that?
Finally, with nuclear power there is the constant issue of insurance. What insurance scheme do the Government envisage? Will the taxpayer be mainly responsible if there is a nuclear accident where the costs are over £1 billion, which is mentioned in the government analysis? It would be very useful to know just what kind of insurance scheme the Government have in mind, because different countries use different ones and no one has come near to paying the costs of a serious nuclear accident.
Baroness Parminter
I add my thanks to the noble Viscount, Lord Hanworth, for posing this important Question. I would contend that the complexity and, indeed, the continually rising costs involved in building nuclear reactors and in putting in place appropriate safety, waste management and decommissioning arrangements will limit the role that nuclear energy can play in helping the UK to meet its essential climate change and energy security goals. I have three principal concerns, to which my noble friend Lord Giddens referred.
First, I agree with my noble friend about the costs of new build. He referred to the costs of the proposals in Finland and France. I would add to that the costs of dealing with existing waste. Decommissioning of the UK’s civil nuclear facilities—principally Sellafield and Dounreay—is estimated at being in excess of £86 billion and is expected to rise. By contrast, as observed by the Economist in its recent study on nuclear, the costs of many renewable energy technologies are falling fast.
Secondly, there is the issue of waste. Despite 60 years of civil nuclear expertise, there is still no long-term solution for storing high-level radioactive waste.
Thirdly, there is the issue of accidents—again, referred to by my noble friend Lord Giddens. With corporate liability limitations, it is the British taxpayer who is liable for the clean-up of any major nuclear accident. As the total clean-up costs for the Fukushima nuclear accident are likely to top £160 billion, it is clear that if the nuclear industry had to insure itself properly, its electricity would be unaffordable.
The noble Viscount mentioned the recent report of the House of Commons Energy and Climate Change Committee on nuclear power in the UK. It concluded that the failure to deliver nuclear new build does not pose a significant threat to our energy security. A viable and sustainable option to deliver a successful and cost-effective decarbonisation of the UK’s power sector by 2030 is an increased deployment of renewable energy technologies coupled with a greater focus on improving energy efficiency. Increasing the UK’s interconnection with European grids must also be a priority, with gas playing a role as a transitional and system-balancing fuel.
In conclusion, I shall ask the Minister two questions: first, when do the Government expect a decision on whether the current electricity market reform proposals are illegal state aid under EU law, given that tendering for nuclear electricity does not fulfil the requirements of Directive 2009/72, Article 8? Secondly, following the decision of Cumbria County Council, what plans do the Government have for locating an affordable, long-term solution for UK nuclear waste?
Lord Moynihan
My Lords, I am a supporter of nuclear power for the main reason that it will be a critical component in our future security of supply. The main case that needs to be made by government is the economic case for nuclear power. The decision to go ahead with new-build nuclear on existing sites should be driven by government, independent of direct links to the pricing of, say, future projections of renewables or new-build CCGT. New-build nuclear must secure a significant part of our essential base load supplies of energy. These stations require substantial up-front capital requiring low marginal and operating costs. They face, as was pointed out, major decommissioning costs. However, above all, the Government should not carry the risk of escalating construction costs. The industry has, as has been pointed out, a bad track record, with Olkiluoto in Finland and Flamanville in France both late and substantially over budget. Can the Minister confirm that the contractor will bear in full any cost escalation during the construction and operating phases of the project?
The second point I shall raise today relates to the proposed contracts for difference. Will the Minister confirm how the proposed plan to fund nearly all low-carbon generation through CFDs and the prospect that nearly all future generation will effectively be remunerated under a contract determined by government can be consistent with overall European Union aims for a competitive single electricity market? As the noble Baroness, Lady Parminter, pointed out, this would be extraordinarily difficult. As the Oxford Institute for Energy Studies has pointed out, the European Court of Justice’s 2010 judgment in Federutility, concerning regulated electricity tariffs and the presumption of the EU’s internal energy market legislation, that the market mechanism should be allowed to operate, would indicate that the Energy Bill appears to fly in the face of the Commission guidelines.
The Commission says, among other things, that in assessing environmental operating subsidies it will consider the following:
“duration of the aid: If operating aid is granted for a long period, this is more likely to distort competition … gradual decrease of aid: If operating aid is reduced over time, the undertaking will have an incentive to improve efficiency; therefore, the distortion of dynamic incentives will be reduced over time”.
To me, a grandfathered, 40-year plus contract for a nuclear power station would be seen by the Commission as foreclosing a significant part of the market. What we have here is the prospect of a legal challenge between national targets for carbon reduction and nuclear and the promotion of renewable sources on the one hand and the development of a European barrier-free market on the other. Will the Minister inform the Committee of the Government’s view of this discrepancy and place in the Library any copies she may have of the legal advice the Government have sought to reconcile these discrepancies in advance of Second Reading of the Energy Bill in your Lordships’ House?
Lord Whitty
My Lords, my noble friend’s question relates to the contribution that nuclear energy can make to both energy security and climate change. I shall focus mainly on the latter. The answer to the question obviously depends on the timescale and, in a different sense, on the nuclear industry overcoming the legacy to which the noble Lord, Lord Moynihan, referred, of economic overconfidence, not to say mendacity on the part of the economics of nuclear power. I support nuclear power, but I recognise that history. We have to overcome it and the continuous slanging match between those who support renewables, who slag off nuclear power, and those who support nuclear power who slag off the renewables lobby. We have to get over that because both are vital if we are to meet the climate change target. Mutual recrimination only benefits longer-term use of damaging fossil fuels.
In the short term, nuclear power will not make a huge contribution to carbon targets. To meet our carbon trajectory, we will have to rely on increased renewables and a switch from coal to gas. In the medium term, however, it could be different. In the nearest thing to a road map that the Government have come up with—the carbon plan—it is envisaged that at the end of the fourth carbon budget we will have 10 to 14 gigawatts of new nuclear power on stream, potentially rising to 20 gigawatts by 2030. On present form that seems pretty improbable, but it is no more improbable than that, in the same plan, we will also have 35 to 50 gigawatts of renewable energy, which will be equally difficult, even if we have the subject of the next debate on stream and working. It is important to take decisions now to set the guidelines for nuclear investment to ensure that we get somewhere close to the 27 or 30 targets for nuclear contribution.
The immediate prospect before the Government is the Energy Bill, which will be before this House in a couple of months. The test case for contracts for difference is the nuclear investment by EDF in Hinkley Point. It is a terrible dilemma for the Government and a severe test of whether the contract for difference can actually work. It will also determine whether we have a viable means of delivering nuclear investment in this country. Part of the media coverage on this has been misconceived. The Treasury has a stronger hand against EDF than is indicated. There is not a lot of demand for nuclear power in Europe. The state-aid issue, to which the noble Baroness, Lady Parminter, referred, will be an important inhibitor on what the Government can do for EDF in any case. The idea that we all have to roll over to EDF demands to bring Hinkley Point on stream is exaggerated. That is not to say that it will be an easy negotiation or that the precedents set in the outcome of that negotiation will necessarily be tenable for other proposals for investment into other nuclear sites. I urge the Government to play hardball in this respect, and ensure that the deal that is done on Hinkley Point, which I very much support, is one that benefits the British people and the British economy rather than straightforwardly EDF.
The Lord Bishop of Hereford
My Lords, I welcome the debate and congratulate the noble Viscount, Lord Hanworth, on securing it. In the three minutes allotted to me, I shall make four overrushed points. First, I am hugely supportive of us walking the nuclear path. I would love the 85% target for 2050 to be achieved, and I stress that thorium molten salt reactors should be on the medium and long-term radar. There is four times as much thorium in the world as uranium. One tonne of thorium is equivalent to about 200 or more tonnes of uranium, which is equivalent to 3.2 million tonnes of coal, which would produce 8.5 million tonnes of carbon dioxide and 900,000 cubic feet of waste fly ash. That is a no brainer when we are starting to be green and looking to be green. There is no argument about that, apart from one of cost, but it could be turned on its head and we could say, “Can we not afford this? Is there a way to achieve those reductions without it?”. I do not think that there is.
Secondly, research and development are vital. I appreciate very much the steer towards putting a bit more money in. What a shame that since 1995 we have had almost no money in R&D for fission. I understand that at the moment in our universities there are only five PhD students doing R&D in fission and, if noble Lords would like to guess the number of post-docs, it is 0.2 of a researcher. That is desperate, and we are heading for a massive skill shortage unless we do something about this now and step up hugely the amount of money spent on research. It is greatly needed.
Thirdly, the national decommissioning authority must surely be given a remit that is new, fit for purpose and joined up with the rest of the documentation we have here. Instead of the national decommissioning authority working on its own brief to its own agenda and therefore not being able to use its money to help with the research, we need to make sure that we change the mindset so that some of what is regarded as waste can be regarded as fuel. If we have thorium molten salt reactors, that would be possible. We need to recognise that the new generations of reactors have far less wastage and therefore there is ultimately far less to decommission, which is another good reason for walking this path, and we need to cut down the £2.3 billion a year that is being spent, which I understand is 80% of DECC’s annual budget. That seems an outrageously large sum, and we need to close the gap.
My fourth point is that this cannot and will not happen without government putting in the initiative, as the noble Viscount, Lord Hanworth, has made clear. Anything that has a 15 or 20-year, let alone a 60 or 70-year, lead time is hardly going to be commercially attractive. It needs government to do it. We are having such trouble finding anybody to build our reactors at the moment because we have trusted to private enterprise, and things of this scale have to be joined up and have government support. I would like us also to have something that is far more clear, coherent and comprehensive with a commitment from the Government to go for that, and then others would come aboard with university and other research money to follow.
Lord Judd
My Lords, clearly the demands of climate change mean that this issue has to be promoted to a top priority in government consideration and action. We have got to stop dithering and get on with it. If we are going to get on with it, there are several points which have to be addressed. The first is why we are not deliberating our energy policy more seriously than we do with a real drive for energy conservation. Are we just fatalist about the level of energy consumption and therefore trying to meet it, or do we have a policy on energy conservation, and how is that being pursued and resourced? Talking about further education, higher education and skills, how much effort is going into producing the people who can be expert and relevant in this field?
Next comes the issue of real cost. That has been well illustrated in what has been said already. We have to look at the long-term costs. We have to be very certain. I do not believe that there can be any total certainty, but we have to be as certain as we can be about what those real costs will be and stop shadow boxing. In that context, the real costs of the alternatives have to be evaluated. What is the competitive advantage? There are special dimensions to this, and it would be foolish to overlook them. There is safety, of course, and there is also security in an age of international terrorism and the rest. What we need to be clear about in these extra costs is exactly where the responsibility lies. From the outset, we have to be clear about what the taxpayer may be expected to fork out in the future and what the industry itself is expected to meet. There are some huge issues in that sphere, but we have to be clear about them. We cannot just drift into another example, like the banks, of de facto welfare capitalism in which when something goes wrong, taxpayers are expected to fill the bottomless pit with their taxes.
The noble Baroness, Lady Parminter, referred to waste. I simply say that I think it is irresponsible to move into the next generation of nuclear energy before we have demonstrated what we are going to do with the existing stock. This has immense implications for future generations for hundreds of years ahead. I cannot understand why in Britain we do not have a costed, carefully researched list of suitable sites for the storage of nuclear waste across the country as a whole—suitable geologically as well as on security grounds. Of course, voluntarism in this area matters, but voluntarism should come into operation in the context of what is clearly the best place and what are clearly the less good places in which this waste should be stored. I simply do not understand why that is not being done and I believe that it should be done as a matter of urgency.
Lord Davies of Stamford
My Lords, we must have a nuclear programme. Renewables are not a substitute, as the House knows very well, because they are not base load. Carbon capture and storage is not a satisfactory substitute because it is still an unproven technology, and it would be deeply irresponsible to set our future by making a bet on that particular number on the board. The same applies to shale oil. I think that we should seriously pursue shale oil opportunities, but there are very serious environmental concerns about it. There are suggestions that the fracking process could permanently pollute the water table, and that should obviously be taken extremely seriously. However, even if that matter is resolved, combined-cycle gas-fired power stations continue to emit carbon. If we really are serious about reducing our carbon emissions to the greatest possible degree, we must at least try to replace a proportion of our energy with electricity generated through nuclear fission. As has already been said, that is a very tall order because all the stations except for Sizewell B will be decommissioned by 2023 and it takes 10 years to build a nuclear power station. Therefore, we can see the problems that we have got ourselves into.
I do not agree with the noble Baroness, Lady Parminter, or indeed with my noble friend Lord Judd, with whom I normally agree on most things, that the problems of nuclear waste storage should in any way hold us up in taking decisions about investing in a new generation of nuclear power. We have that problem anyway with the existing stations that we are closing, and the problem is much greater with the present nuclear power stations because current technology is much less efficient and much more waste is produced. Therefore, I do not think that that is a very good argument.
I want to take the opportunity, as I think we all do this afternoon, to ask a very simple question of the Government. What the devil are they doing? What do they have to show in this area after nearly three years in office? They have been arguing about contract differences for two years. They would have been in a much better position to come to a deal two years ago, when we had two German groups, as well as EDF, who were extremely keen on getting involved in the nuclear project in this country. Therefore, I fear that the Government may have got themselves into a very unfavourable position simply by not being sufficiently dynamic or focused earlier in this Parliament.
My second question is: what is the fallback position? If the Government cannot come to an agreement with EDF, what do they do? We know that the Government do not have a fallback position on the economy and their economic policies have not worked. They have not thought through that situation properly. They have not thought through the possibility that the initial strategy that they are pursuing might go wrong. That is a very irresponsible way to run any business or any country. What fallback position do the Government have in mind for our energy requirements if they cannot come to an arrangement with the private sector to build new nuclear power stations?
Lord Jay of Ewelme
My Lords, I must declare an interest straight away as a non-executive director of the main Paris board of EDF. Indeed, I am the only non-French member of that board. I should stress that I favour nuclear energy not because I am a member of the EDF board; I was delighted to accept membership of the board because I believe that nuclear energy should be part of our energy mix. I hope very much that the present negotiations between the Government and EDF over Hinkley Point will succeed. A year or so ago, I would have said that they seemed condemned to do so. However, having observed negotiations more recently, albeit indirectly from both Paris and London, I do not think that success is in any way assured. Robert Peston got it right in his FT blog last week, when he talked of both sides proceeding with “cautious pessimism”. I hope that I am being too pessimistic myself. If we do not renew our nuclear capacity over the next 10 or more years, I believe that we will face real problems of energy security as existing nuclear and coal-based plants close, as gas prices rise when, as it is hoped at some point, the economy picks up, with shale gas being less significant inevitably on this side of the Atlantic than on the other side, and as wind power remains expensive and intermittent.
We would also find it much harder without nuclear as part of our energy mix to meet our carbon reduction targets. It is worth remembering that a nuclear power station will emit around five tonnes of CO2 per gigawatt hour of electricity generated, compared with nearly 500 tonnes from gas and 900 tonnes from coal. I add, in case the noble Lord, Lord Lawson, is listening somewhere, that climate change is not the only reason for clean energy. There is also a very strong public health reason for clean energy as anyone who has experienced Beijing smog in recent years will know.
For all those reasons I welcome the Government’s commitment to nuclear power. I also welcome the conclusion of the Government’s nuclear industrial strategy—in particular its review of the nuclear research and development. Nuclear R&D needs to be far more robust than it is at present. That approach is needed if we are to respond to Britain’s needs and, as the noble Lord, Lord Jenkin, said, if we are to exploit the rise of nuclear power elsewhere in the world, which is the real opportunity for us as a society. Finally, like the right reverend Prelate the Bishop of Hereford, I hope that molten salt reactors and thorium fuel will get the attention they deserve in our R & D programmes in the future, in providing the prospect of nuclear power that is safe, provides economic benefits and much more manageable waste disposal.
Lord Foulkes of Cumnock
My Lords, we should be grateful once again to my noble friend Lord Hanworth for drawing our attention to the looming crisis in the electricity supply industry. We raised it in the energy sub-committee of the Cabinet in 2001. To be fair, successive Governments have done nothing about it—I was going to use another phrase there, but nothing about it is more polite. A total of 19% of our electricity now comes from nuclear power and all but one of the existing power stations will close by 2023. What are the Government planning? They hope to build 16 gigawatts of nuclear capacity by 2025, but we have already heard from my noble friend Lord Jay that even he is pessimistic about EDF being able to deliver the only one that is in prospect, which will produce just over six gigawatts. It really is a looming crisis.
As my noble friend Lord Hanworth said, the markets are failing to deliver. In the past, nuclear power stations have either been funded by Governments, and we cannot do that any more because we privatised British Energy and now it is owned by the French—we know we have one person looking after our interests there, but mostly by the French—or were provided on the balance sheets of companies against their other revenue and assets. As the departing chief executive Volker Beckers of RWE nuclear power made clear, balance sheet financing is not now an option. Therefore the only option is to try and find these loans from the market, and they are proving both illusive and expensive. That is why, as the noble Lord, Lord Jenkin, said, they have been pulling out of the option of building. What is the way forward? By contrast to these expensive loans, the cheapest source of funding would be for the Government to build the nuclear power stations and then either sell them to the utility companies or bring companies in to operate them.
I have only one question for the Minister and I will conclude on it. Why is the Government’s ideology stopping this being done? I predict that this is the only way that we will be able to fund this—I see no other way forward. It would be cheaper, easier and quicker for the Government to build their power stations with the option of selling or hiring them to contractors once completed. Is it only ideology that is stopping the Government doing that?
Lord O’Neill of Clackmannan
I thank my noble friend Lord Hanworth for introducing this debate, although when it was first announced I was not sure that we would have much to debate. I thought that we would probably be well on the way to getting a strike price. Secondly, I did not anticipate the European Parliament having the vote that it did, throwing the carbon market up in the slates. The first question that we have to ask the Minister is what the Government propose to do to retrieve the situation so that the price of carbon can be made clear so that potential investors in all forms of generation of a low carbon character, whether renewable or nuclear, have some sort of idea of where we are going in Britain.
If there is a problem, it is not the Government as such; in my view it is the Treasury. In my recent experience of the nuclear industry within the past decade, I remember two occasions. One of them concerned the pay and conditions of the Nuclear Installations Inspectorate, where there was a dramatic leakage of staff because of the skill and expertise of these individuals and because their pay and conditions was of a Civil Service character. It took the Treasury years to come to an appreciation of the fact that these people had to be put into a special employment box, as it were. Thankfully, the Government’s upcoming legislation will deal with that.
Secondly, there was the whole question of the contractorisation of Sellafield and the insurance thresholds that had to be set for that. It took months and months of trying to get the Treasury to appreciate the significance of this insurance question. The insurance question was quite straightforward. There had to be a raising of the threshold whereby the Government would become responsible for any potential difficulty. It was not an issue that was raised by a single company although the one I was associated with at the time, the Washington Group, had been the favourite company to take the Sellafield account. It eventually took the intervention of the shareholder executive from BIS to get the Treasury moving. We know the merits of the case one way or another and it has been described already, but the Treasury is the department causing the problem.
It is fair to say that DECC in these matters is a well-intentioned lightweight spectator. It has to get its act together. There is so much at stake here. We need to get a price and we need to get a signal sent because there are people not only in EDF but other contractors that are prepared to come in and spend money and to use different forms of generation and different reactors, which could widely expand our industrial base. If nothing else, given that we are no longer going to be able to build lean-tos and conservatories, we need something to help the construction industry. Certainly, starting work at Hinkley Point as quickly as possible would be a good signal to all concerned.
Baroness Worthington
My Lords, if you thought it was challenging speaking on nuclear power for three minutes, try summing up this really fantastic debate in three minutes and also questioning the Minister. It has been fantastic and I congratulate my noble friend Lord Hanworth on securing the debate. It shows what great industry there is in the House for energy matters. I am sure that these debates will continue when the Energy Bill reaches us. On balance, most speakers seem to agree that nuclear power has an important role to play in both decarbonising our power systems and in providing more security of supply. But important caveats were put down by speakers today. My noble friend Lord Whitty said that we may want to pay for nuclear power, but not at any price. It must not be at the expense of consumers.
The noble Baroness, Lady Parminter, made very important points about waste. Waste is an issue. We cannot move to 60 or 70 gigawatts of nuclear power with a once-through fuel cycle. It generates far too much high-level waste. We need innovation if we are to be able to solve that waste problem. My noble friend Lord Judd quite rightly said that we cannot in all conscience go forward planning lots of new reactors until we have solved the problem that we already have today and, importantly, worked out what it costs.
There seems to be a common theme that the noble Viscount, Lord Hanworth, started off: what is the contingency plan? If our current proposals to move ahead with these large-scale pressurised water reactors do not happen, and a number of speakers raised the fact that they are very difficult for the private sector to deliver with the timescales and capital costs involved, the contingency plans and the insurance, it is a very difficult issue. A number of noble Lords mentioned that in the past there has always been a fairly high level, if not a complete level, of state involvement. It is not clear that this is going to work out as we might hope, therefore there needs to be a contingency plan. Many noble Lords mentioned the cost overruns of the Flamanville and Finish reactors. We need to learn lessons from them if we are to pursue this course.
I shall make a few suggestions, picking up on something that the right reverend Prelate the Bishop of Hereford mentioned. There is a way for the state to get involved in nuclear R&D at a much higher level than it is at the moment through rethinking our approach to decommissioning. At the moment, a huge proportion of DECC’s budget goes on the NDA and its role in decommissioning our existing reactors. The legislation that created the NDA in 2004 was written at a time when we did not conceive that nuclear would need to have a renaissance or that it would come back to help us tackle climate change, and therefore the NDA was given a very narrow and limited remit just to dispose of the waste. When is waste not waste? It is when it is fuel. Some of those fuels that are currently stored as waste could kick-start a new generation of nuclear reactors, whether fast-breeders or any kind of closed-cycle nuclear system. If we use thorium, which a number of noble Lords mentioned, we can move to much more sustainable nuclear power, so if the Government do not have a contingency plan, I ask that they develop one and base it around the concept that we could bring about quite a high degree of innovation in the nuclear industry and get back to what the UK was very good at.
We have a very good history of innovation in nuclear power. It was only in the 1980s that we started to see a precipitous decline in R&D and the closure of eight of our 12 nuclear research labs. With the Beddington report, I hope that we are starting to turn that cycle. Let us get involved in nuclear fission research again; let us increase the budgets and make sure that we try to help bring the world a much more sustainable nuclear future in which nuclear can compete with carbon capture and storage, renewables and all the other solutions that will be necessary to deliver us from climate change. I do not think it is an either/or, or that it is nuclear or renewables or CCS. They all have to play a role, but we probably need a new type of nuclear, and I would love us to play a part in bringing that to reality.
The Parliamentary Under-Secretary of State, Department of Energy and Climate Change (Baroness Verma)
My Lords, I thank the noble Viscount, Lord Hanworth, for raising this debate today. I know that he has a long-standing interest in this subject. I agree that this is a very timely debate. I hope that when I go through my speaking notes I will be able to answer some of the questions that have been raised by noble Lords today. Those that I cannot answer in the short period that we have for the debate I will write to noble Lords about and place a copy in the Library.
I do not approach this debate as the noble Viscount, Lord Hanworth, did, with pessimism. My endeavour today will be to lift his spirits a little. Noble Lords have asked searching questions. I may have to give better, detailed responses to many of them, so it would be prudent of me not to give half-baked responses now.
We are aware that one-fifth of our power generation will be coming off within the decade and therefore it is vital for our nation’s energy security that we work towards long-term certainty and investment. That is why I am pleased to say that this Government, in recognising that, have introduced the Energy Bill, which will bring forward the biggest electricity market reform that we have seen for a very long time.
Nuclear power has a part to play in the UK’s energy mix. For more than 50 years it has been part and parcel of a route for electricity supply to this country and it contributes more than 19% of all electricity generated in the UK. We are committed to seeing nuclear as a part of the energy mix, alongside renewable energy and carbon capture and storage from fossil fuels. A new generation of nuclear power stations will help to ensure that we have secure, affordable and low carbon energy.
Towards the end of last year we saw the successful sale of Horizon Nuclear Power to Hitachi, and EDF was granted the first nuclear site licence in 25 years at Hinkley Point C. Regulatory approval of the EPR reactor has been given. This March, the Secretary of State gave planning consent for a multibillion pound project planned at Hinkley Point in Somerset. This project alone could enable the generation of enough low carbon electricity to power around 5 million households, making it one of the largest power stations in the UK. The noble Viscount, Lord Hanworth, specifically focuses his Question on our assessment of how nuclear power will help the UK to meet its climate change goals. As he is aware, we see a new generation of nuclear power stations alongside other low carbon forms of electricity as being the most cost-effective as well as energy-secure way to meet our legally binding carbon targets.
The life cycle of carbon emissions from new nuclear plants will be similar to that of emissions from wind power and, of course, much less than those from fossil-fuelled plants. It is competitive with other generation technologies and is expected to be one of the cheapest sources of low carbon electricity in the future. New nuclear can contribute significantly to our economic growth, creating long-term employment and supply chain opportunities. The Energy Bill currently going through the other place is bringing in some of the largest changes in reforming electricity that the UK has ever seen. The Bill will put into place measures to attract the £110 billion investment that is needed to replace current generating capacity and upgrade the grid by 2020 as we see a rising demand for electricity. The Bill puts into place the certainty that generators have looked for in investing in large projects and, through our capacity market, is also building in a mechanism to ensure energy supply. These measures are intended to try to shield us better from price hikes that occur on the international markets and over which we have little or no control.
Last month we published the Nuclear Industrial Strategy, which provides us with essential bridges between our shorter-term policy for the next tranche of new build and the research and development needed for nuclear to play its part up to 2050 and beyond. The strategy’s key actions are to have a new nuclear council that brings together relevant players from across the nuclear supply chain. The strategy will better co-ordinate research and development and innovation through the new bodies—the Nuclear Innovation and Research Advisory Board and the Nuclear Innovation Research Office. It will ensure a long-term plan to meet skills in the sector and will look at how to reduce costs across the industry.
The strategy was in response to the House of Lords Science and Technology Committee’s insightful 2011 report, when the Government undertook a number of actions, along with the findings and recommendations from Sir John Beddington’s advisory board, which formed the basis of the strategy. Government and industry will be working together to drive economic growth and job creation. As noble Lords are aware, we are currently in negotiations with NNB GenCo regarding the contract for Hinkley Point C. The Government are determined to work for a deal that delivers a fair, affordable and value-for-money deal for consumers. Should an agreement be reached, it will be laid before Parliament, and it will include details of the strike price.
Before concluding, I have a number of questions to which to respond, and I will try to whizz through them as quickly as possible. The noble Viscount, Lord Hanworth, asked about our response to the Energy and Climate Change Select Committee’s report on new nuclear. Of course, we welcome the report. It recognises the important role that new nuclear will play in meeting the UK’s energy security, but we will put forward a proper response to the report some time in the coming days.
My noble friend Lord Jenkin asked about investment. I think I laid out clearly to noble Lords that the Government have announced increased investment. Over £45 million-worth of additional investment is going into nuclear research and development, alongside the publication of the Nuclear Industrial Strategy, which was published in March this year. I could give a breakdown, but if noble Lords would like me to do so, I will write to them about that.
My noble friend also asked about EURENCO. The Nuclear Industrial Vision Statement sets out the industry’s own ambitions for the future. The Government intend to work with our partners in EURENCO to move forward preparations for the sale of all or part of our one-third of the shareholding. It is government policy not to continue to hold shares in companies where the shareholding does not deliver any policy objective.
My noble friend Lady Parminter asked whether current electricity market reform proposals are in line with European state aid rules. We are working with the European Commission to ensure that our policies—particularly contracts for difference and the capacity market—are compliant with state aid rules. It is important to ensure that we have a stable and certain regime that has the confidence of industry and provides best value for consumers.
My noble friend also asked about our long-time approach to the management of nuclear waste, as did the noble Lord, Lord Judd. We remain fixed to the idea of GDF being the best way to ensure that nuclear waste is dealt with properly, but we recognise that we need to have communities that come to the process voluntarily. Therefore, when west Cumbria decided in January this year not to go ahead, we began the process of looking at the lessons to be learnt. We recognise that an approach has to be voluntary because in places where voluntarism was not taken forward the process faulted there too.
My noble friend Lord Jenkin asked about the role and structure of NNL. The Government recently announced changes to the management structure of NNL when the current contract expires. We are working with the company to ensure that it is at the centre of our future programme of research and development through the operation of the Nuclear Innovation Research Office.
The noble Lord, Lord Giddens, asked about subsidies in relation to nuclear. The coalition has agreed that there will be no public subsidy for new nuclear power unless similar support is available more widely for other types of low carbon generation. However, it is for the private sector energy companies to construct, operate and decommission nuclear power stations and for the Government and independent regulators to ensure that appropriate levels of safety, security and environmental regulations are met.
The noble Lord also spoke about the experience in France and China. We are already looking at lessons learnt around the generic design assessment, and mitigating risk by making sure that our requirements are understood and that designs are completed on time. But, again, it is for us to work and engage closely with industry and regulators to ensure that early build programmes applied in the UK are built to the UK context.
Both my noble friend Lady Parminter and the noble Lord, Lord Giddens, asked about electricity market reform proposals in relation to nuclear and, in particular, in relation to the minimum price agreement with EDF. We have not yet come to an agreement. We are still in negotiations. These are commercial negotiations and therefore it would not be right for me to discuss here and now where we are with those negotiations. All we can say is that this Government are determined that, whatever price is agreed, it will allow for fairness and provide value for money for the consumer.
I am rapidly running out of time and I still have quite a number of notes to go through. Therefore, I shall conclude and will write to all noble Lords on the questions to which I have not been able to respond. I thank all noble Lords for their valuable contributions to this important debate. We have made, and will continue to make, great progress in ensuring that new nuclear can contribute as much as possible to the UK’s future energy mix. This Government are fully committed to cost-effective new nuclear power contributing alongside other technologies. This is not about ideology; it is about the need to ensure that the UK has a secure and cost-effective low carbon energy supply.
Severn Barrage
Lord Cope of Berkeley
To ask Her Majesty’s Government what evidence they have received about the effects of building a Severn barrage.
Lord Cope of Berkeley
My Lords, I beg leave to ask the Question standing in my name about the possibility of a Severn barrage as proposed by Hafren Power, which the Government are considering. Evidence given to the Commons Select Committee on Energy and Climate Change has made it clear that it is a naive proposal, absurdly short on detail, and I am sure that it will not happen. I am glad about that, because its effects would be highly damaging. I hope that it will be strangled very soon. As long as the idea exists, it is delaying proper, careful thought about realistic ways of generating power from the colossal energy of the tides in the Severn estuary and it is also damaging investment.
When I was first in the Commons, my constituency boundary was the Severn for some 18 miles from the edge of Avonmouth to upstream of Sharpness, although boundary changes later took away the northerly six miles.
The reasons that the present proposals will not be put into practice are several and distinct. The four main ones can be summed up in the words “silt”, “habitats”, “economics” and “ports”.
The Severn is a muddy estuary. Millions of tonnes of sediment—literally 30 million tonnes at high spring tides—are washed up and down by the huge power of the tides twice a day. The question is where the sediment will settle if a barrage is built. On the scale that we are talking about, dredging is an unrealistic solution which makes no commercial sense.
There is no chance of replacing the destroyed habitats as we are required to do under the habitats directive. Salmon and other fish will not survive the turbines according to the Environment Agency and other experts during the Select Committee’s inquiry.
The economics are also crucial. Any tidal generator will produce power at highly forecastable but limited times of day and not always at the peak. However, gas, coal or biomass-fired stations, let alone nuclear ones, cannot be switched on and off as the hours of high water come and go. In any case, you have to provide enough generating capacity of other types to fill the peak while the barrage is resting.
That brings me to the effect on the ports. I am particularly concerned about the ports of Bristol and Sharpness, which I first knew as an MP. The evidence to the Select Committee from Associated British Ports concerning its ports in South Wales is similarly hostile to the proposals.
I was primarily motivated to ask for this debate by paragraph 37 in Hafren Power’s submission to the Select Committee, the only paragraph which refers to the ports. It says there will be,
“minimal inconvenience to navigation. Hafren Power intends to minimise any impact on current business at ports upstream”.
In fact the port of Bristol believes its operations would be fatally maimed by the building of the proposed barrage. Forty years ago, Bristol City Council, which owned the docks, built the new Portbury Dock to add to the existing Avonmouth Dock. Some years later, under a Labour council, it sold the whole complex to the present company. Since that sale, over £500 million more has been invested, making Bristol one of the most modern and productive ports in our country. More major investments are planned to support continued growth, but they are currently inhibited by the existence of the Hafren Power proposals.
Bristol is a big ship port. Ships come from all parts of the world with a very wide variety of cargoes. If the Hafren Power scheme were constructed, the navigable water depth at high tide would be reduced by over two metres and perhaps by three metres, depending on the silt, which I mentioned earlier. In the older Avonmouth Dock, ships over 30,000 deadweight tonnes with draughts of nine metres and above would be unable to enter. That would kill important business for the port. In the newer Portbury Dock, the effect would be similar, but it is larger and vessels with a draught of over 13 metres would be very restricted, and the existing largest vessels, currently up to 130,000 deadweight tonnes, could not enter. Of course, ships with lower draughts would be able to enter, but on many fewer days in the year. The port would be commercially unviable, and the current investment would be wasted.
The new locks to be incorporated within the barrage are another problem. They would necessarily be in the deep water channels, and the ships approaching them would be exposed to the full force of the Atlantic weather, unlike the sheltered approaches to the existing ports. There would be delays and risks attached to their operation. There would also be large costs, not only for lock operations but for dredging, pilotage, survey and towage and for the shipping companies. These costs must be paid by the barrage and guaranteed for its lifetime, but we have not been allowed to see the calculations.
Hafren Power wants a hybrid Bill, sponsored by the Government for the benefit of its consortium which would then sell it on to a sovereign wealth fund. It makes it sound simple. This part of its submission attacked my blood pressure and my funny bone simultaneously. Has it no idea of what the procedures, costs and complications of a hybrid Bill are? Let it look at the Cardiff Bay Barrage Bill proceedings and it will begin to understand the timescale and the huge costs to all parties—promoters and objectors alike—of this route. It would be a long and highly costly process, profitable only to the QCs and their colleagues involved, as well as to large armies of experts. The ports either side of the estuary and many NGOs are united against the proposal. They remain mystified by some of the claims made in Hafren Power’s submissions.
There have been numerous studies of the possibility of a barrage done over the past century and more. The latest thorough government study took several years, examined all kinds of options, and rejected the idea a couple of years ago. Other countries have considered and dismissed this as a form of power generation—for example, Canada, France, or more recently South Korea.
I recognise that this afternoon my noble friend cannot be expected to give the Government’s considered comments on all this. Apart from anything else they need to see the report of the Select Committee, which I suppose will be with us within a few weeks. But I hope the department realises that the matter needs to be settled. My concern is, as was expressed to some degree in the previous debate, that the Department of Energy and Climate Change has that insidious Whitehall disease of ditheritis—constantly talking and consulting about things and never deciding for years on end. These proposals are unworkable and damaging. It is time to decide and to say, “no”. Then we can get on with deciding how really to harness the massive tidal energy of the Severn without all the damage involved.
Lord Whitty
My Lords, I rise with some diffidence, given that the noble Lord, Lord Cope, has made his position on this issue clear. I am afraid that I am still somewhat ambivalent about this proposition. On the face of it, it is a fairly major contribution to meeting our climate change targets—5% of Britain’s electricity could be generated by this. It also has economic upsides of substantial employment. There are probably enough speakers on the list who will emphasise the Welsh dimension. I also emphasise that in the south-west there will be a significant number of jobs—probably more than at Hinkley Point.
However, there are economic and ecological downsides. I declare a past interest as a member of the board of the Environment Agency. I was persuaded, with some reluctance, that we should oppose this proposition, largely on the grounds of the effect on migratory birds and fish and the need to find compensatory habitats, as well as the effect on the whole ecology of the Severn estuary. It is not possible to replace the habitats that exist in south Wales for migratory birds, nor frankly is it possible to construct turbines that do not have some fairly negative effect on large numbers of fish. Nevertheless, this is a conflict between two different environmental objectives. We have to bear in mind that to meet the trajectory of carbon reduction to which we are committed—in a sense the subject of the previous debate—we will have to make some unpalatable decisions and face up to some fairly unpalatable costs, whether it is nuclear energy or some of the major renewable projects, including this one.
I do not think that I will have quite changed my mind again. Despite what the noble Lord, Lord Cope, said, I think that the new proposition has some mitigating factors, although they are not entirely convincing, even to me. We need to look at the latest version with some considerable scepticism, but the project as such has some serious merits. However, I want to seize on the last remarks of the noble Lord, Lord Cope, on whether there are other ways of making use of the great tidal difference in the Severn. There were earlier propositions of having a series of lagoon-type projects that would not save so much carbon—we have to be fair about that—but which would probably cost only slightly less, and would not have either the negative ecological effects nor the damaging effect on the Bristol ports to which the noble Lord, Lord Cope, referred. I ask the Minister specifically whether those other alternatives are still being considered as well as the latest Hafren proposal. I would not want to be as dismissive of it as the noble Lord, Lord Cope, but the Government need to look seriously at other propositions as well.
Lord German
My Lords, I start by looking at the whole issue of the elusive trail that we have had over many decades to try to harness the power of the Severn estuary. I wish that we could call it the Bristol Channel and Severn estuary because when I was a boy we were taught that the line between Newport across to Avonmouth was the line of the Severn and that after that it became the Bristol Channel. Of course, the barrage that has been referred to is in the Bristol Channel, and we need to look at it as a whole.
The elusive trail indicates that we have had sufficient studies and need to consider what might be the best way in which to move forward. I agree with the previous Government’s report, which said that,
“the Government does not see a strategic case to bring forward a Severn tidal power scheme … The costs and risks for the taxpayer and energy consumer would be excessive compared to other low-carbon energy options”.
So the test of all this is, therefore, to find a way of harnessing this energy that meets the energy needs to which we all aspire but also provides a satisfactory solution to the environmental, economic and technical problems that are an inevitable consequence of this work. The challenge is that putting all our eggs in one basket could result in the outcome that was predicted and agreed to by the last Government, with which I agree: that we cannot do it without significant cost and economic and environmental damage.
I believe that we need to look much more widely at the whole range of energy uses—tidal stream, tidal range, wave power and offshore wind power. All those forms of power and energy are available to us; the problem is that we have only nascent technologies, which have not yet been brought to a level where they can be put into action in demonstrable projects. The whole energy sector has been dogged, for example, by the difficulty of creating appropriate turbines to deal with the rise and fall of the tide. I understand that, in the current proposal, Rolls-Royce owns the concept and patent for a nascent turbine that will work in both directions, but there is no sense that it has been developed beyond a prototype into something that could be seen to work. That is why, for example, a lagoon would allow that testing to take place, allowing that to happen and to build in an appropriate manner.
I understand that the Government have invited submissions, which is where this Hafren proposal has come from. Is there a role for Her Majesty’s Government not just to ask for submissions but to give some sense of direction and promotion to the way in which those suggestions should come? We have an urgent need for a scaled-up demonstration project. Out of that might come the world-wide excellence that we need, and expertise and technology that can be developed elsewhere. Are the Government now in a position to establish what the net economic benefit of the current Hafren proposal is to the United Kingdom? What steps do they propose to take to promote the use of alternative and multiple technologies within the Severn and the Bristol Channel so that we can begin to satisfy the need that is there?
Lord Berkeley
My Lords, I am afraid that you have me today, and not my cousin, who joined the House about a month ago. We both have fewer connections with Berkeley than the noble Lord, Lord Cope of Berkeley, who used to represent it in the other place. I certainly have a great interest in this project. Having worked briefly on it as an engineer about 40 years ago, I was interested to read a comment in the Financial Times on 18 December last year, saying:
“There are two varieties of Severn bore. The first is a regular surge of water up-river due to the funnelling effect that the English and Welsh coastlines have on the tide. The second is a regular surge of enthusiasm for slinging a barrage between said coastlines to generate tidal electricity”.
That probably sums up where I think we have got to today.
This is a very big project, if it happens, and much bigger than the Channel Tunnel, on which I worked for about 15 years. The difference is that the Channel Tunnel, although it was difficult to finance in the private sector—and Margaret Thatcher clearly and rightly said that it should be—used proven technology. The technology for boring a tunnel in chalk is well proven, but even so, finances were difficult for the tunnel.
However, for this project the small details available do not yet give me any confidence that the new technology is at all proven; the noble Lord, Lord German, mentioned turbines, which I was about to mention, there are locks, and there is the actual design of the, presumably rock, barrage itself. Bearing in mind that the Severn—or the Bristol Channel as it is quite rightly named—is very deep there, it has already got strong tides and wave heights of between six and eight metres. I do not know who has been in a small boat in a six to eight metre swell. I went to the Scilly Isles last week and the swell was quite big.
The force of the tide on a breakwater is pretty frightening even to conceive. About 30 years ago, a breakwater built in a place called Sines in Portugal had a similar storm attack it and it collapsed completely. I am sure designs have moved on since then, but we need to have confidence not only that the design is adequate for these very difficult conditions but that it can be built on time and on budget. The constructability is equally important. We have had no real answers to any of the questions that noble Lords have asked this afternoon, the noble Lord, Lord Cope, in particular. Until they are answered, I do not think one can talk about finance in the private sector.
I recall very early when we were trying to do the Channel Tunnel trying to get commitments from bankers to say it could be financed in the private sector. We got a variety of letters, but in the end they said, “If it does not rain next Tuesday and it does snow next Wednesday, we think we can finance it in the private sector”. That is not good enough nowadays. You need a lot more study, effort and investigation of all the effects, including on the ports, which are extremely serious. I am very doubtful. My recommendation is to cancel the thing now and start looking at smaller schemes, develop the technology and make sure it does not completely wreck the River Severn and the Bristol Channel.
Lord Jenkin of Roding
My Lords, anyone who has crossed the Rance barrage near St Malo in France will have seen the attraction of being able to harness the tides to generate electricity. Of course, it is a very narrow dam and it is entirely sheltered in the great bay that St Malo stands on—totally different from what we have in the Severn or the Bristol Channel. I have long seen the attractiveness of trying to do it, but from what I have read and studied, this proposal by Hafren Power is simply not the way that it is going to be done.
My noble friend Lord Cope referred to the effect on the ports, particularly the ports of Bristol and Portbury. I would like to say a word or two about that. The thing that has always puzzled me is how on earth it was going to be financed—and there has been a lot of discussion—other than if the Government were going to find the money. As noble Lords will realise, that is not currently feasible. Therefore, is it going to come from the private sector? We do not know. Hafren Power has been extraordinarily economical with its business plan. It has published documents, but not given any real indication of what the whole business case is. The negative impact that this would have on the port of Bristol has been full spelled out to me by the port company. I have greatly admired what it has done in recent years. My noble friend referred to some of the investments and improvements that have been made. Its growth depends entirely on its competitiveness, and its ability to attract shipping in and out in competition with the many other ports that this country has.
This company’s brief refers to,
“the immediate and ongoing impact of commercial blight on their operations and in the longer term if a barrage was consented and built, the drastic impact the change in the tidal range would have on the viability of the port”.
It says it,
“would eventually lead to closure of the port at the cost of many thousands of real jobs”.
That is its view, and I have not seen the answer to that.
Hafren Power has attempted to answer the points, but I am sure that I am not alone in having seen the port of Bristol’s meticulous attack on the Hafren Power paper in which it describes Hafren Power’s claims as far-fetched, unfounded, naive and ignorant of the way a port in this country is operated. I cannot help feeling that this has all been made perfectly clear to the Select Committee, but it is desperately important. My noble friend has said that this threat should be removed and we should be looking again, as others have said, to alternative methods of harnessing the power of the tides in the Bristol Channel and the Severn estuary.
Baroness Jones of Whitchurch
My Lords, I thank the noble Lord, Lord Cope, for giving us the chance to have this debate. So far all the contributions have been fairly negative, so I am very pleased to say that I am going to put the opposite point of view and state some of the advantages of the scheme that is being considered today.
The barrage offers us an enormous opportunity to harness the tidal power of the Severn in a way that could create something unique with a worldwide reputation in terms of its concept and impact. I find it an exciting and innovative project, and if we can find a way technologically to deliver it, it is a prize worth having. It would be clean, secure, sustainable and low carbon. It would deliver 5% of the UK’s total electricity needs. It would be a predictable source of energy as the tide ebbs and flows and, once built, it could continue to produce energy on that basis for over 100 years. Those are all a prize worth having.
The energy it would produce would negate the need for three or four nuclear reactors, going back to our earlier debate, or more than 3,000 wind turbines at a lower cost than either. It is something that should be explored in more detail and, I hope, embraced with both hands.
A number of noble Lords spoke about the environmental impact and obviously this cannot be ignored. There will be changes to the local habitat, but I see this in the context of evolution and transformation rather than of damage and destruction. We had a very similar debate at the time of the creation of the Cardiff Bay initiative with lots of concerns about the wildlife impact, but the truth is that the bay has now attracted new species of birds and fish and has become a new, welcome wildlife sanctuary. I believe that a similar process will occur in the lake behind the barrage which will attract species previously unable to breed successfully because of the strong current.
As I understand it, Hafren Power is working hard with wildlife groups to minimise the environmental impact, and it is important that these discussions continue, but I hope that the local environmental groups will also see the benefit of a big green initiative in their backyard. At the same time, the barrage is being designed to have a minimal ecological impact by being permeable to fish and invertebrates and providing numerous fish ladders which, I understand, take fish only one generation to master.
I have spoken mainly about the environmental advantages of this project but, of course, there are serious economic advantages as well. It will be funded by private investment, with 80% of the investment being spent in the UK. It will employ at least 20,000 people, the construction of the 1,000 turbines will help revitalise the struggling South Wales economy and it could be a major export for us if we get it right.
There is increasing urgency about this matter. We are falling behind in terms of meeting our green energy targets. There may be other options, but to me it seems that this is the only game in town at the moment, so I hope that when the Minister replies to the debate she will be able to reassure us that the Government are taking this seriously and are prepared to consider facilitating the necessary Private Member’s Bill.
Baroness Miller of Chilthorne Domer
My Lords, the noble Lord, Lord Cope of Berkeley, in his extremely able introduction to this debate, mentioned four particular downsides. I would have to add a fifth, which would be flooding. Somerset has had a terrible winter. The effect of the barrage there, as the Severn surge comes up the channel and the Parrett is trying to empty the flood water down into the channel, has not been properly modelled by Hafren. I doubt whether anyone will be able to model it sufficiently. By dint of simply having the barrage, you might be writing off a large part of Somerset. You only have to look at what was flooded this winter to see how likely that is. That is a tremendous downside, especially, obviously, for the people of Somerset. It is a matter that needs to be settled.
The noble Lord, Lord Cope, remarked on what he called ditheritis, which is an extremely important point. Back in 2004, Friends of the Earth published a good comparison between the barrage and smaller, more varied schemes, particularly tidal lagoons. It is now 10 years later and we have lost the lead that we might have had on tidal lagoon technology. It is not too late to imagine that we could still forge ahead with it, but which investors will put their money into anything like that before they know what will happen with the barrage? This needs to be settled and settled urgently.
The smaller schemes offer tremendous upsides as well. If we are thinking about technology that we can export, we can pilot a number of things—the tidal stream and the tidal lagoons, as suggested in Swansea bay, which join up with the land and ones that do not join up with the land as suggested for Bridgwater bay. They relate better to communities and would undoubtedly bring the same sort of employment opportunities as a whole barrage but with a more varied application throughout the world. Not everyone has the place to build an enormous barrage. It might be a world tourist attraction, but it would not be the sort of technology that would lead to replication across the world. There would be only one or two other places where a barrage-type structure as proposed would be applicable, whereas the tidal lagoons could happen in a number of other places.
My question to the Minister, which is not original this afternoon, is what is DECC doing to support the piloting of tidal lagoons? It has been remarkably silent on that subject to date. I remember going to see the noble Lord, Lord Whitty, when he was the Minister to talk to about this. He was very helpful, and we had a discussion about habitats and so on. He, of course, was a Defra Minister and it was the responsibility of another department on the energy side, but departments have changed name so often that I cannot remember what it was called then. We really need to get on now and make a decision so that we can look at the more promising technologies.
Lord Hylton
My Lords, I regret that some remarks about the Severn by senior politicians seem to have generated more heat than light. Following the noble Lord, Lord Jenkin, I suggest that we should learn from France. The tidal scheme, La Rance, opened in Brittany in 1966. It generates 240 megawatts, is extremely reliable and has never had to have a major refit. It operates on an average tidal difference of 8.2 metres, whereas the mean for the Severn is 14.5 metres. A much smaller generator at Strangford in Northern Ireland has been working since 2007.
The Severn and its estuary are a national asset waiting to be developed. Of course, I understand the doubts and reservations already expressed by port, wildlife and fishing interests. It is important, however, to realise that a massive fixed barrage is not the only possible means of generating electricity. A much smaller scheme has been proposed up-river at a site known as the English Stones. Tidal lagoons and tidal canals are both possibilities with or without pump storage. A Bridgwater bay lagoon may perhaps have lower generating costs. It occurs to me that the existing supports for one or both motorway bridges could be strengthened to carry turbines driven by the incoming and outgoing tides.
Her Majesty’s Government have had two and a half years to reflect and make further inquiries since the Department of Energy and Climate Change published its feasibility study in October 2010. I therefore urge them to be proactive and to enlist the best academic and engineering brains to identify the most economic method or combination of methods to produce clean, non-polluting energy for generations to come. They should not just rely on nuclear power with its quite unpredictable clean-up costs. Interest rates are now as low as they are ever likely to be, so the present moment is an opportunity not to be missed. I therefore trust that this debate will inject real urgency into the search for solutions.
Lord Dixon-Smith
My Lords, one certainty has not been mentioned so far, which is that simply leaving the estuary alone will cost nothing. We have to deal with rising sea levels, and the Severn estuary is highly vulnerable to them. We already have a London barrage, which we know all about, and which will have to be replaced. That problem writ large all the way up the Severn estuary will be a problem not only in Bristol but in every other city anywhere near the estuary, and all landowners will have to face it too. It is not an easy question to answer. This is part of a much wider issue. That is the first thing that we must realise.
Secondly, to answer a point made by my noble friend Lord Cope, intermittency is not an issue. It would be perfectly simple to build some barrages on the east coast where we have some quite large estuaries. The time difference for high water is almost precisely six hours. If barrages are built on both sides of the country, there will be an even flow of electricity into the system. That point needs to be made.
Thirdly, we do not sufficiently consider the energy pattern and requirements caused by our Climate Change Act. By 2050 we shall have had to say goodbye—I say good riddance—to the internal combustion engine. All land transport will have to be driven by some other system. My bet would be on hydrogen, which requires electricity to generate it. Those who say that it cannot be done because there is no hydrogen infrastructure have got it wrong. The hydrogen infrastructure already exists. Wherever you have electricity and water you can make hydrogen. It is actually much more efficient to use that in a vehicle than to use batteries, and there is not quite the waste disposal problem because hydrogen is permanently recycled. The electricity generating requirements as a consequence of that are at least twice as big, if not two and a half times as big, as anything we are considering at present, so we have that implication, too.
That brings us back to the point that we have this enormous potential resource. The question is not whether we can afford not to use it but how best to use it. I am afraid that I am not enough of a technician to know whether this latest proposal is appropriate, and there we have to fall back on my noble friend in the Government because they get all the information.
The other certainty—this is where I will finish—is that this is a resource that we cannot afford to ignore. It may seem harsh to say that this may be more important to the country than the port of Bristol, but when the chips go down in 10, 15, 20 or 30 years’ time, that may be a reality that we all have to face. If it is a choice between future energy supplies for this country and the future of the port of Bristol, I would hate to be in the position of the Government, but it is a decision that would have to be taken.
Lord Howarth of Newport
My Lords, talk about building a Severn barrage has been going on since the 19th century. In our own time, we know that every reasonable opportunity needs to be taken to develop renewable sources of energy to mitigate the potentially catastrophic effects of climate change. A Severn barrage would utilise predictable and sustainable tidal power on a scale to provide perhaps 5% of Britain’s energy requirements, the carbon payback time would be a matter of only months, and the installation could be expected to generate energy for perhaps 120 years. If it is not to be Hafren Power’s Lavernock Point to Brean Down barrage, then it has to be another Severn or Bristol Channel barrage scheme.
Of course, the ecological impacts on sites of special scientific interest and on birds are very important. Biodiversity matters very much indeed. Every care should be taken to minimise damage and to compensate with biodiversity offsetting measures. However, the major gain in relation to climate change surely outweighs those other ecological considerations. There are also legitimate and important business interests for Bristol port and for the aggregates industry, but these should be a matter of negotiation and the Government should actively broker a resolution of the differences that exist there. We need vision; we need decision; and we need leadership.
I was disappointed that the previous Government were not persuaded of the strategic case for building a Severn barrage, and DECC, under this Government, continues to equivocate and dither. The Secretary of State, we are informed, told a Liberal Democrat conference that the consortium’s numbers,
“aren’t in the place that they would need to be”.
He suggested perhaps looking at smaller lagoon projects, and he went on to say, tellingly:
“But government isn’t spending a huge amount of our own time developing those projects”.
Quite so.
The benefits in relation to climate change are vital, but the benefits in relation to the construction industry and the engineering industry in terms of jobs and pioneering technology would also be very great. Contrary to what the noble Baroness, Lady Miller, said to us, I believe that there would be flood protection benefits and that there could also be benefits in terms of transport links. There would be benefits for communities on both sides of the Severn estuary and the Bristol Channel.
If the evidence that has been made available so far is insufficient, the Government should get on and establish the evidence. If, having done so, they have decisive reservations about the credentials of the Hafren consortium or the specifics of this particular project, if the Energy and Climate Change Select Committee gives this project a thumbs down or if problems emerge in terms of the capacity of a private consortium to finance the cost of the barrage—perhaps some £25 billion—then the Government should take the lead and put together a scheme that would work. If necessary, the Government themselves should borrow to help to make this investment. They can borrow at exceptionally advantageous rates in present markets, and I believe that the markets would applaud capital investment by the Government in this kind of infrastructure.
The inertia of Whitehall, of Parliament and of the European Parliament in relation to climate change is one of the factors that cause so many people to despair of politics and to take a gloomy view of the future. I would go so far as to say that it would be a crime against the planet if the Government passed up the opportunity to identify and drive forward an ecologically acceptable and financially robust Severn barrage scheme.
The Earl of Courtown
My Lords, this has been a fascinating debate. The noble Baroness, Lady Jones of Whitchurch, mentioned the Cardiff Bay barrage and how that changed Cardiff. I gather that it is a much better looking place than it used to be. On the other hand, she actually said that there were environmental advantages to the work that was done there. In fact, what has happened is that the shelduck and other shore birds that were based in Cardiff Bay have now left that area. Initially, they were found in local areas, but they have now totally disappeared. In addition, common redshanks that moved from Cardiff Bay and then went to the Rumney estuary now have much lower body weight and their winter survival has dropped enormously.
I agreed entirely with the noble Lord, Lord Whitty, when he said that there was no way that any scheme could possibly be put in place to mitigate against environmental damage. Many millions of tonnes of sediment go up and down the Severn on a daily basis in the spring tides. I gather that 68,000 migrant birds go to the Severn every winter. There are 24,000 hectares of Severn estuary, 20,000 hectares of mudflats and sandbanks and 1,400 acres of salt marsh. Neither must we forget the many different species of commercial fish that use the estuary in their life cycle.
Noble Lords might have already guessed that the environmental issues are the ones that concern me most. We have to consider not just the possible vandalism to the part of the estuary directly affected by the construction of the barrage but the environmental blight to the whole estuary as well as the river catchment area—the Severn, the Teme, the Usk and the Wye to name but a few. The barrage is to have more than 1,000 reversible turbines, claimed to be fish-friendly, to be built by a company that has not yet been chosen to a design that has not yet been made or tested. I understand that the turbines will have a tip speed of 9 metres per second, which I imagine would be fairly lethal to any migrating fish.
We have heard what the Environment Agency has to say about this. The turbines will be operating 24 hours a day, seven days a week. Highly protected species under the habitats directive such as twait shads—an endangered species—lamprey and salmon would be vulnerable and species such as the sea trout protected under the UK biodiversity action plan would also be in great danger. All this would be happening in a catchment area that contains 25% of the salmonoid habitat in England and Wales. The Angling Trust reminds us that the sea trout and salmon fishing industry in the Usk and Wye is worth £10 million alone.
I consider myself to be extremely lucky. I live fairly close to the Severn estuary and regularly walk along the banks of the tidal Severn opposite Newnham. I regularly visit the Wildfowl and Wetlands Trust and I just feel that we should be looking at another way of getting our renewable energy as opposed to this present scheme.
Lord Touhig
Like many noble Lords I have had an interest in a Severn barrage for many years. Indeed, when I was a member of Gwent County Council we strongly welcomed the previous scheme for it and some years later when I visited the Rance barrage I was greatly impressed by the power and the way that the whole operation worked.
Britain now finds itself with an energy crisis as a result of a lack of forward planning. Some 25% of our generating capacity will close in the next few years. We are facing potential blackouts by the mid-2020s unless we invest in large-scale energy projects. I believe that a Severn barrage is a sound form of forward planning because it will provide generations of Britons with cheap electricity.
The construction of a barrage will be a massive boost to our economy and provide thousands of jobs during construction and afterwards. Previous schemes have foundered on two issues—the need for large amounts of public money and the significant environmental impact. But if the developer, Hafren Power, is to be believed, its proposal will not require any money from the Government at all. It is up to Hafren Power to demonstrate and prove that. I hold no brief for the developer, but it claims that it has learnt from earlier studies and proposes a new type of barrage, which will put environmental considerations first. The ambition is to build an 11-mile line of more than 1,000 slowly spinning turbines, housed in massive concrete blocks, between Brean in England and Lavernock Point in Wales. It is certainly worthy of our consideration. Such a barrage will generate electricity as the tides go in and out, so the natural tidal flows can be maintained. The turbines will be spread right across the estuary, so the currents and navigation will not be affected. Looking at other options, I believe that the barrage is superior to wind farms, if only in reliability and predictability. I have first-hand experience of wind farms; when I was Welsh Minister, I travelled to Scotland to visit a new wind farm. The only trouble was that, when I got there, there was no wind.
A barrage, unlike wind farms, brings with it a substantial legacy of flood protection, cheap electricity and economic renewal. A Severn barrage will help defend against tidal flooding and storm surges caused by sea-level rises, and will help to reduce flooding upstream, saving billions of pounds in damages. It has already been mentioned that construction could take more than nine years, and 20,000 jobs could be provided. Those things should not be easily dismissed. Opponents of the barrage, including the Port of Bristol and some environmental lobby interests, have raised proper concerns. These concerns have to be taken seriously, listened to and taken into account so far as that is possible. But they should not be allowed to become a barrier to progress in developing a Severn barrage.
Over the past decades, we have seen report upon report written on the subject of a Severn barrage. These reports have been considered, debated, amended and then forgotten. Indeed, if the trees cut down to provide paper for these reports had instead been floated across the Severn, they would probably have covered the 11 miles from south Wales to the west of England. It is time to resolve the issue of a Severn barrage, and to be brave and bold and commit ourselves to this great enterprise. Frankly, I do not mind who builds and operates the Severn barrage, but I would like to see it built, and built in my lifetime.
Lord Grantchester
My Lords, any proposal that presents the opportunity to harness tidal power, and in doing so generate 5% of the UK’s electricity needs, while also bringing in much-needed inward investment to the south Wales, Bristol and Somerset region, is one to be considered very seriously. The many and varied contributions to the debate today highlight not only the interest but the extent of the effects that building such a barrage shall have, bringing lasting energy, economic and environmental changes. It is on these three parameters that any scheme must be assessed, with extensive effects not only on the estuary but throughout the region. The clear conclusion of the debate is that the Hafren Power scheme is unsatisfactory. On that basis, however, the balance of the debate was to try to find some scheme to capture the advantages, albeit with an understanding that there are inherent difficulties. Even the noble Lord, Lord Cope, and the noble Baroness, Lady Miller, hinted that better was to come.
The Department of Energy and Climate Change reported on initial feasibility studies in October 2010. The noble Lord, Lord Touhig, highlighted the background canvas against which the energy assessment can be made. The report assessed five potential schemes to be feasible. As the Government’s feasibility study and Hafren Power’s own plans highlight, the barrage has the potential to generate up to 5% of the UK’s electricity generation, around 15 terawatt hours a year. As well as having the advantage of being entirely free, the reliability of the tides that power the barrage also removes the problem of intermittency that affects other renewable energy sources. The noble Lord, Lord Dixon-Smith, suggested a second tidal scheme. However, it could not be constructed in time to contribute to the UK’s 2020 renewable targets.
On economic considerations, the potential gains to the local area could also be very significant. The expansion of the steel works at Port Talbot and Bristol, and the new factories that Hafren proposes to build in south Wales and Bristol to make the innovative bi-directional turbines that the barrage could hold, could lead to a much broader economic regeneration in the area, which is much in need of inward investment of this magnitude. Indeed, one of the highlights of this project is that, if it were to go ahead, it would be almost unique as one of the few large-scale infrastructure projects not planned for the south-east. But as well as having many positive effects, the designs as they currently stand raise several notable economic concerns that would need to be thoroughly addressed: notably the effect of the barrage on Bristol’s docks, which support up to 8,000 local jobs, is crucial.
My noble friend Lord Courtown reminded us that the environmental consequences of the barrage are even more challenging than the economic or energy impacts. My noble friend Lord Berkeley said that something of this sheer size and with this kind of design has never been tried before. As the government study makes clear, among other things it is unclear how the current regulatory framework would apply to such a structure in an environmentally sensitive area. The 200 or so turbines that would power the barrage still need to be designed, tested and built; something that will take nearly a decade alone.
The Severn and its many tributaries are internationally recognised natural heritage conservation sites. Many characteristics of this unique environment will be changed by the presence of a barrage. Hafren’s controversial suggestion of allocating £1 billion for providing compensatory habitats for affected wildlife, while seemingly attractive, will go no way towards the value of such a unique habitat. The department’s report concluded that tidal power in the Severn estuary would be at high cost, high risk and at a value of money less attractive than other renewable energy technologies.
My noble friend Lord Whitty asked what other schemes were still under consideration. The noble Lord, Lord Cope, despite being against, still wanted further and better schemes to come forward. Rather than embark on a massive scheme, my noble friends Lord Berkeley and Lady Jones, and the noble Baroness, Lady Miller, asked whether there were some smaller schemes worthy of being undertaken to gain expertise and experience that could, by small steps, provide insights into the future, albeit that they may appear less than attractive on their own merits. As the noble Lord, Lord German, and my noble friend Lord Howarth suggested, the lead should be given by her department. The noble Lords, Lord Hylton and Lord Jenkin, asked whether we should not learn from such overseas experience.
While making reservations, the Welsh Government are essentially positive to a scheme. Will the Minister explain what discussions have taken place recently with the Welsh Government, how valuable these discussions have been and whether her department has a shared pathway towards supporting the Welsh Government’s in principle approval in the near future?
The Parliamentary Under-Secretary of State, Department of Energy and Climate Change (Baroness Verma)
My Lords, I thank my noble friend Lord Cope for introducing this debate in a very thoughtful and informative way. We have heard a wide range of views. During the debate, they edged towards one end of the argument more than the other, but again it allows me to lay out the Government's commitment to renewable energy.
We are number one in the world for installed offshore wind capacity. We are also the world's leader in marine energy, with more devices deployed in the UK than in the rest of the world combined. The Government have been a proponent of exploiting our rich marine energy resource and making the most of the jobs and growth that it can bring. There are a number of questions that I need to respond to. Given the shortness of time, I will undertake to write to noble Lords if I do not manage to respond to questions that have been raised.
Harnessing power from the Severn estuary could clearly be a significant asset for the UK, but this has to be done sustainably. That is why my department led a two-year cross-government study investigating the potential of Severn tidal power schemes. The study concluded in 2010 that it did not see a strategic case for a publicly funded tidal power scheme. The Government have remained open to the possibility of a privately funded project coming forward. Our study has provided us with a wealth of evidence on the potential effects of the Severn barrage. In particular, it highlighted how little we knew about the dynamic environment of the estuary itself. It concluded that environmental impacts, particularly on fish, birds and habitat, are likely to be larger than expected and extremely challenging to mitigate and compensate for.
The study demonstrated that a barrage might provide a net benefit to the regional economy, with net value added to the economy and jobs created. However, these would come at the expense of a potentially large negative impact on the current ports, fishing and aggregate extraction industries. The study also identified the likely cost of the Severn tidal schemes to be as much as £34 billion for a barrage at a time when there are easier and cheaper alternatives. Despite the extraordinary amount of work produced, the government study barely scratched the surface of the potential effects of a Severn barrage. Any specific proposal for a barrage would need extensive and credible evidence on the effects of its particular design.
This brings me to the current Hafren Power proposal for the barrage. We have received an outline proposal from Hafren Power and have had some discussions with the company. However, the information provided so far does not allow us to assess whether the proposal is credible. Nor does it demonstrate if the project can achieve the benefits that Hafren Power claims. There are a number of issues that Hafren Power will need to explore in much greater detail before we could take a view as to the whether its proposal warrants further interest from the Government.
In particular, we need to see credible, clear evidence of the likely effects of the proposal, including evidence on the environmental impacts; that the project is affordable and good value for consumers; of the effects of the proposed turbine on both the environment and energy output; on the impact on upstream ports and navigation, and detailed mitigation plans; detailed evidence around flooding impacts; and detailed evidence to support job creation figures. Those are questions that a number of noble Lords have already raised here today. Crucially, the project will require substantial revenue support to provide a return on the investment. It is therefore vital that Hafren Power provides robust evidence that the level of support sought for the project compares well with the expected future cost of alternative low carbon technologies, such as nuclear power or offshore wind, that a barrage would most likely displace.
The Hafren Power proposal has not gone far enough in providing the evidence required at this stage for the Government to justify endorsement of the project. That said, as is the case for any similar project, should Hafren Power develop its proposal further, and in particular provide credible, robust evidence to substantiate the claims in its outline proposal, the Government are prepared to consider it further.
The House of Commons’ Energy and Climate Change Committee is currently running an inquiry on the Hafren Power proposal. The inquiry has raised much interest and the committee has received a lot of input and information. Only a few weeks ago, my ministerial colleague, the Minister of State for Energy and Climate Change, gave evidence at that inquiry, making the points that I have made today. I look forward with interest to the conclusions that the committee will reach within the next few weeks, based on the evidence it has received. I am sure that noble Lords will join in reading its conclusions with interest.
I quickly turn to some of the points raised by noble Lords. My noble friend Lord Cope asked if we would agree to introduce this, as Hafren Power has asked, as a hybrid Bill. The noble Lord knows the complexities of introducing legislation. Given we do not have enough evidence and are not fully confident that the project as it stands is viable or affordable, the case has to be much better made. As I have explained, Hafren Power’s current proposals fall very much short of that.
My noble friend asked about the Government being privy to the financial details of Hafren Power’s proposal. As my ministerial colleague in another place showed to the Select Committee, we have received only an outline of the proposal and this mainly focuses on detailing the work programme in advance, rather than on providing detailed information about the proposal itself, and that includes finance.
The noble Lord, Lord Whitty, and my noble friend Lord German asked about alternative ways of using the Severn estuary. That is why we welcomed the recent Regen South West report on a balanced technology approach in the Bristol Channel. There is a huge amount of energy in the channel, and it is only right that we should be seeking the best ways of extracting that energy. Any proposal or set of proposals will have strongly to demonstrate, as with Hafren Power, that they are viable, good value for money for the consumer and environmentally responsible.
I agree with my noble friend Lord Cope that a barrage would produce intermittent energy. Despite its intermittency, the highly forecastable nature of tidal energy could provide strong system-balancing benefits. However, as my noble friend made very clear, these need to benefit the overall scheme including climate change, energy and economic, environmental and cost impacts.
Baroness Verma
My Lords, I swiftly resume my position in responding to the questions raised by noble Lords. I see that the noble Lord, Lord Hylton, is not in his place, but I will respond to a question that he asked about developing other technologies in place of the proposed barrage. We are committed to looking at all types of marine energy technologies. We have provided sustained and targeted support for the development of the wave and tidal stream sector, enabling it to move from initial concepts to prototypes, and are now looking to support the first array of support packages for the programmes.
My noble friend Lady Miller asked about support of lagoons. I think the noble Lord, Lord Whitty, also alluded to them. Lagoons were a subject of the Government’s 2010 study. Our position remains the same. We are considering all credible privately funded proposals. The department is aware of the proposal to build a 250 megawatt tidal lagoon in Swansea bay. The project is in the pre-application stage in the Planning Act consent process. We expect a formal application for the consent to be submitted later in the year.
My noble friend Lord Courtown asked about the impact on wildlife. Whatever proposal we have—whether it is that of Hafren Power or any other proposal—the Severn tidal power feasibility study highlighted how little we know about the dynamic of the Severn’s environment. Therefore, we need a better understanding of the impacts that the projects will have on wildlife, and Hafren Power needs to provide further details of the proposal and the work it is going to do to mitigate any impacts on the environment, and particularly on wildlife and habitats. Currently, we do not see enough evidence to support that.
My noble friend Lady Miller also asked about the flood risks of the barrage. The Hafren Power proposal suggests that a barrage would create a positive effect by reducing flood risks, but we have not yet seen enough evidence to substantiate those claims.
The noble Lord, Lord Hylton, is still not back in his place but I will respond to a question that he asked concerning the need to build a barrage in order to meet our 2020 targets. Given that the construction of the barrage would not help us to meet those targets because the proposal is a long way even from concept stage, we need to look at other plausible pathways for low carbon energy, several of which do not include tidal or marine energy.
The noble Lord, Lord Grantchester, asked about our discussions with the Welsh Government. We have had discussions at an official level and I know that the Welsh Government would support a credible proposal. However, the key to all this is that the proposal has to be credible.
There are a number of questions that need to be answered. However, I see that my 12 minutes are up, so I shall close by reiterating that we want a more detailed proposal from Hafren Power. Any proposal that it puts forward needs to substantiate the claims of environmental benefits as well as good value for money for consumers and socioeconomic benefits. Should this power be harnessed, it must be done sustainably, as any plans going forward will need to take account of the unique ecology of the Severn estuary, its existing social and economic activities, and all the costs associated with harnessing its power.
This has been a very full and interesting debate and one that I suspect we will come back to as further proposals from Hafren Power come forward. I should like to end on a positive note. My noble friend Lord Cope, who introduced the debate today, has, through the tie that he is wearing, educated me a little further on the importance of knowing about Bristol port and its history. The tie illustrates the ship, “The Matthew”, which in 1497 sailed from Bristol port and discovered America.
Iraq: Chilcot Inquiry
(11 years ago)
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Lord Dykes
To ask Her Majesty’s Government whether they will hold discussions with the administrators of the Chilcot inquiry into the Iraq war to ascertain a date for publication.
The Chancellor of the Duchy of Lancaster (Lord Hill of Oareford)
My Lords, the Government do not have any plans to hold such a discussion with the Iraq inquiry. Sir John Chilcot advised the Prime Minister last July that the inquiry would be in a position to begin the process of giving those subject to criticism in the report the opportunity to make representations by the middle of 2013, and that the inquiry would submit its report once that process had been completed.
Lord Dykes
With thanks for that Answer, can the Leader of the House reassure the House on a very important point—that high official circles in the UK and the US have not sought to interfere with the independent findings of the Chilcot inquiry, especially on the crucial decision to go to war together?
Lord Hill of Oareford
I can give that assurance. It is extremely important that this inquiry is independent; it was set up very deliberately to be independent and it must have that independence. It must consider the evidence that it has and reach its conclusions, which we will all be able to see in the fullness of time, but it must have a free hand to do that.
Lord Morris of Aberavon
My Lords, having been involved in the setting up of some public inquiries, I have noticed a tendency for them to be longer and longer. I understand the need to collect all the material evidence, and for all due processes to take place. In future, if any public inquiry is set up, should not a time limit be imposed and, furthermore, an extension granted only in exceptional circumstances?
Lord Hill of Oareford
I understand that point. However, with some of these very big inquiries it is difficult to be absolutely clear at the outset about what a suitable length of time is. It is right that the Chilcot inquiry on Iraq has been able to follow the leads that it feels it needs to follow, and had the time to do that. On the more general point about inquiries, I am sure the noble and learned Lord will know that one of the post-legislative committees that this House will set up in the new Session will look at the operation of the Inquiries Act 2005 and ask exactly these kinds of questions about whether we can learn lessons about the conduct of these inquiries, whether they can be done more quickly, their cost and so on.
Baroness Williams of Crosby
My Lords, I was one of those in this House who was perhaps most extensively and intensively involved in the whole of the Iraq issue—the invasion of Iraq and the situations that arose from the post-victory occasions, including the involvement of many contractors in the building up or otherwise of Iraq after the war. While I fully take the points made by the Leader of the House into careful account, it is also the case that the lessons to be learnt from an inquiry—and the lessons to be learnt from this are probably among the most important of all—depend a little on the passage of time between the findings of that inquiry and the use of those lessons to affect policy. I ask him to bear in mind, as he considers this, the gap between the necessary and right attempt to give people the right to respond, but also the importance of the conclusions for the future work of this Government’s policy as well as the policy of the Opposition.
Lord Hill of Oareford
I agree with the points my noble friend makes. To be clear, the timing of this inquiry is set by the inquiry itself. The Government have not set a timetable and we are not seeking to rush it. It must take the time. However, I take the point that we need to learn the lessons and that it has to be within a reasonable timeframe.
Lord Foulkes of Cumnock
My Lords, could the Leader of the House tell the House how the Government will take account of the conclusions and recommendations of the Chilcot inquiry on Iraq in deciding their policy on Syria?
Lord Hill of Oareford
First, we need the report to be concluded. Then, as the Chilcot inquiry has made clear, there needs to be a process whereby those people who are mentioned in the report have the chance to comment on it. Then the report will be published. Then everyone in this House, as well as the Government, will be able to draw the conclusions from the Chilcot inquiry, wherever that takes us.
Lord Hurd of Westwell
Could my noble friend inject a little urgency into this process? The furthest we got from him today was that we would have the benefit of the report in the fullness of time. In our experience, the fullness of time is fairly full.
Lord Hill of Oareford
We all know that certain formulations have a certain elasticity, and I take his point. The most recent pronouncement from the Chilcot inquiry itself is that it hopes to finish the report by the middle of this year. Then the process—the formal word is “Maxwellisation”—of giving individuals the chance to comment would follow. That is what the inquiry has said is its current expectation of the timetable to which it is working.
Lord Butler of Brockwell
My Lords, does the Leader of the House agree that the terms of reference of the Chilcot inquiry are so wide as to be almost infinite, and that the timing of the report’s publication depends not just on the handling of the representations but on the Government’s own clearance of what is to be included in the report? Will he undertake that that process will be done as quickly as the Government can manage?
Lord Hill of Oareford
I take both those points. On the Government’s co-operation with the declassification of documents as the process goes on, the Chilcot inquiry has said on the record that that process is working well. I know that the Government will co-operate as closely as they can to expedite that process of declassification as rapidly as possible.
Baroness Symons of Vernham Dean
My Lords, can the Leader of the House tell the House what is the period within which the people mentioned in the report have to respond to the report?
Lord Hill of Oareford
I am not able to give a precise timescale for that because that will, by definition, depend on what the findings of the report are, what the criticisms of individuals are and how long that process will need to take. However, I am sure that Sir John is as keen to publish his report, so that we can all see it, as everyone in this House is to get it done.
Female Genital Mutilation
(11 years ago)
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Baroness Cox
To ask Her Majesty’s Government what information they have on the number of instances of female genital mutilation carried out in the United Kingdom in the past 10 years.
The Parliamentary Under-Secretary of State, Home Office (Lord Taylor of Holbeach)
My Lords, the prevalence of female genital mutilation in the UK is difficult to establish because of the hidden nature of the crime. However, the Government are absolutely committed to tackling FGM and protecting the 20,000 girls who a 2007 study estimated were at high risk of being subjected to FGM in England and Wales each year.
Baroness Cox
My Lords, I thank the Minister for his sympathetic reply. Is he aware that in 1983 I supported a Bill outlawing female genital mutilation in this country, which was strengthened by further legislation in 2003, but that according to research currently as many as 65,000 women living in this country have suffered FGM? It is feared that some may have undergone the procedure here and others sent abroad for the practice, but there has not been a single prosecution. Therefore, what effective provisions are being undertaken urgently to protect the estimated 30,000 girls currently at risk in this country?
Lord Taylor of Holbeach
I congratulate and thank the noble Baroness for her support in tackling this abhorrent form of abuse. The law alone cannot eliminate this practice, as I think noble Lords will agree, but it needs to be properly enforced, of course. The Government welcome the CPS action plan to address barriers to securing a prosecution. They have also funded some front-line organisations to encourage communities to abandon the practice themselves, issued multi-agency guidelines to support front-line professionals and published a statement opposing FGM.
Lord Walton of Detchant
My Lords, is the Minister aware that in the 1980s, when I was president of the General Medical Council, that council decreed that any doctor registered with the GMC who was found to have carried out the operation of female genital mutilation would be subject to the full disciplinary procedures of the GMC and would be accused of serious professional misconduct? Just as there have been no convictions, as far as I am aware there have been no references to the GMC of doctors accused of carrying out this procedure. How can that be explained?
Lord Taylor of Holbeach
It is difficult to explain except in terms of the very secretive nature of this crime and the unwillingness of victims to come forward. The noble Lord has rightly pointed to the key role that health and social services can play in providing support for communities in seeking to rid this country of this abuse.
Baroness Rendell of Babergh
My Lords, some months ago the Director of Public Prosecutions undertook to appoint a committee to produce a report on female genital mutilation, in all its aspects, in the United Kingdom and to publish it in the summer. May we know when that report is likely to appear because, as has been mentioned, there has never been a prosecution and the practice continues as it has done for about 25 years? Is it not time that we had this report so that we could look forward to something being done to put an end to this horrible practice?
Lord Taylor of Holbeach
I am sure that I reflect the sentiment of the whole House in thanking the noble Baroness for her interest in this matter and her engagement with it. The Government are not happy with a situation in which there have been no prosecutions. We are pleased that the Director of Public Prosecutions is engaging with that. We are working closely with the Crown Prosecution Service and we hope that the report of which the noble Baroness speaks will be made public and that we can build our strategy on it.
Baroness Trumpington
My Lords, this was the first work that I had to do when I held the office that the Minister holds today. When I tried to talk about this subject to the people involved, they said, “If you try to stop us, we’ll do it on the kitchen table”. Am I right in thinking that this kind of thought still exists among the people who wish to continue this horrible practice?
Lord Taylor of Holbeach
We know that there are some strong feelings on this issue. Indeed, yesterday there was a report of a campaigner being abused by people who disagreed with her. This is not an easy subject. It is a hearts and minds issue, so we have to influence these communities and encourage them to recognise that there is no religious or medical basis for this abuse of young people and it should stop. I can assure the House that the Government take it very seriously.
Baroness Gould of Potternewton
I am pleased to hear how seriously the Government take this issue. How much funding are they initiating in order to train teachers, nurses, health workers and carers to recognise when there is a possibility of FGM happening and when it has taken place? Also, how is that funding being distributed across the country? I declare an interest as the president of FORWARD.
Lord Taylor of Holbeach
I am very grateful to the noble Baroness for her involvement with FORWARD, which presented a key report that identified the 66,000 possible victims of this abuse. The amount of money spent is within individual department budgets, but there is a specific £50,000 budget dedicated to ensuring that this matter is fed across departments and that leaflets are produced. The Government are spending £35 million in countries where this practice is prevalent, in seeking to change the cultural background against which the abuse occurs.
Lord Chidgey
On that very point, my noble friend is possibly aware that, since 1997, DfID-supported anti-FGM education and empowerment programmes have led to some 5,500 communities in Senegal abandoning FGM. What discussions is the Minister’s department having with DfID to establish the impact of the success of those programmes on British African communities in the UK, particularly with regard to Somalia, where 98% of young girls are still mutilated, placing thousands of Somali girls in this country at risk?
Lord Taylor of Holbeach
My noble friend has identified Somalia as a particular area of concern. We are working very closely across all government departments. I think it is clear to noble Lords that the only way we can achieve progress is by using all the levers available to us: government departments; communities; and, through DfID, the overseas cultural base of this practice.
NHS: ECMO Machines
(11 years ago)
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Baroness Gardner of Parkes
To ask Her Majesty’s Government whether extra-corporal membrane oxygenation (ECMO) machines that are capable of restoring heart functions some hours after an apparently fatal heart attack are in use in any NHS hospitals; and, if not, what consideration is being given to their installation.
The Parliamentary Under-Secretary of State, Department of Health (Earl Howe)
My Lords, the equipment and facilities to undertake cardiac ECMO support are available in all five NHS adult cardiothoracic transplant centres in England and in the five national respiratory ECMO centres, three of which share a location. Provision of cardiac ECMO support is a complex intervention with significant risks attached to it. A cardiac ECMO service requires a fully trained team to be available around the clock and does not consist of simply purchasing the medical equipment.
Baroness Gardner of Parkes
That is very good news and I thank the Minister for it. It is desirable to have these facilities available. Does he agree that the group which would benefit most of all from this would be young people who die suddenly and unexpectedly, often in the sporting field? This is a much greater tragedy for families than the more usual cardiac attack at a later age. Should not more publicity be given so that people involved in those activities know that such facilities are available? You could get a young person by helicopter to one of those centres within the number of hours that your life would be prolonged for.
Earl Howe
My Lords, there is, I understand, no intervention capable of restoring heart function some hours after a heart attack. The only exception is not applicable to heart attacks but to people who have had circulatory arrest due to hypothermia—for example, people who have been buried in avalanches or immersed in very cold water. That area is currently being researched. It is only in a very limited number of circumstances that ECMO support can improve a patient’s chances of survival following cardiac arrest—usually in patients who suffer in-hospital cardiac arrest following surgery.
Lord Patel
My Lords, as the noble Earl indicated in his opening remarks, a typical facility required in the provision of a service such as ECMO for adults who suffer acute myocardial infarction would include a perfusionist, intensive care facilities, an intervention cardiologist, a cardiologist expert in cardiac failure, a cardiac surgeon, together with specialist nurses. Preliminary results of studies suggest that the survival rate might be less than 30%. Does the noble Earl agree that more research is needed before such a treatment can be made available routinely?
Earl Howe
I fully agree. The noble Lord is quite right. ECMO cannot be provided by just any ICU team. It is a highly specialised treatment with significant potential for serious complications, and considerable expertise is therefore required, including having a multidisciplinary team of the kind that he outlined. In general, capacity has much more to do with having suitably trained staff than with having the equipment itself.
Lord Hunt of Kings Heath
My Lords, I refer noble Lords to my health interests. On the question raised by the noble Lord, Lord Patel, about evidence, would the noble Earl consider referring this to NICE for its expert advice?
Earl Howe
I shall certainly take that idea away with me, but I think that there is broad consensus among the medical community that the key to success with ECMO is getting the patients connected to the equipment quickly. Although it is a moving scenario, all the evidence so far suggests that ECMO confers no benefit if some hours have elapsed since the cardiac arrest.
Baroness Jolly
My Lords, services that need ECMO machines would currently, in the new world, be commissioned by NHS England. Will my noble friend explain to the House what role, if any, the department now has in commissioning such services?
Earl Howe
My Lords, the department itself no longer has a role in commissioning highly specialised services. NHS England is implementing a single operating model for the commissioning of 143 specialised services. That replaces the previous arrangement whereby 10 regional organisations were responsible for commissioning specialised services and, to be frank, there were wide variations in the standard of those services. The new operating model represents a significant change to the previous system and should result in better outcomes.
Baroness Masham of Ilton
My Lords, is the Minister aware that Glenfield Hospital in Leicester, which has ECMO, saved many lives in the swine flu epidemic last year and does more than just hearts?
Earl Howe
I am fully aware of that. Glenfield has been leading the development of ECMO services. It is one of the biggest ECMO centres in Europe. It is currently the largest provider of children’s ECMO in the country, treating about 70 paediatric ECMO patients a year, and now provides an adult service.
Baroness Knight of Collingtree
My Lords, can my noble friend clear up a point of confusion that may have arisen about his first Answer to this Question? It was reported in the Times newspaper by the science editor that people could be brought back from the dead up to seven hours after their hearts had stopped. Is that a report on which we can lay much credence?
Earl Howe
My Lords, my advice is that in most cases of cardiac arrest that is not possible. Where there has been circulatory arrest in the particular conditions that I described, such as immersion in very cold water, the heart can in some circumstances be restarted, but I would not wish to excite noble Lords’ interest in this technique without proper evidence. I am afraid that the article, which I did see, raises people’s hopes perhaps unfairly.
Earl Howe
My Lords, as the noble Lord knows, that decision is interdependent with the decision around the Safe and Sustainable review of children’s cardiac services. Until that issue is determined, it is not possible for me to say what will happen to the children’s ECMO service at Glenfield.
UK Industry: Competitiveness
Lord Haskel
To ask Her Majesty’s Government what steps they are taking to improve the competitiveness of United Kingdom industry.
Lord Peston
My Lords, on behalf of my noble friend Lord Haskel, and at his request, I beg leave to ask the Question standing in his name on the Order Paper.
Lord Popat
My Lords, the UK economy is recovering from the most damaging financial crisis in generations. The Government are putting in place the right policies to deliver balanced and sustainable growth in the UK. That will take time. We are already seeing some progress. Between 2010 and 2012 the UK climbed from 12th to 8th in the World Economic Forum’s global competitiveness index.
Lord Peston
My Lords, noble Lords are stuck with me because my noble friend is in hospital and I hope that they will join me in wishing him a speedy recovery.
Lord Peston
My Lords, given the massive size of the current account deficit—almost unprecedented—would it not be to the advantage of our country to improve the competitiveness of UK industry if the external value of sterling fell drastically?
Lord Popat
My Lords, the external value of sterling fell from 2007 to 2009 and led to modest growth in exports. The impact may have been negated somewhat due to global demand weakness, especially in the European Union, which is our largest export market. Evidence suggests that export growth is driven more by changes in foreign demand than by price competitiveness or other factors.
Lord Bilimoria
My Lords, would the Minister agree that we are all very proud that a British university, Cambridge, has won more Nobel prizes than any other university in the world? However, would he also agree that that is in spite of this country underfunding research and development expenditure as a proportion of GDP? We spend less than both the EU and OECD averages. We spend half of what a country like South Korea spends. Do the Government not believe that we should be targeting to spend a proportion of GDP at least equivalent to the EU or OECD average to maintain our competitiveness? Otherwise, we are going to be penny wise and pound foolish.
Lord Popat
My Lords, this issue has been raised by the noble Lord in the past. Education is our fourth largest export earning. I agree with the noble Lord that we need to spend more money both on research at universities and on further investment in training provided by businesses. I will take the noble Lord’s point into account and will be happy to ask my colleague in the office to write to him to see what investment we are making in research at our universities.
Lord Forsyth of Drumlean
My Lords, could my noble friend explain why there has been a dramatic fall in the value of the pound and yet our export performance is pretty poor? What is the explanation for that and what can be done about it?
Lord Popat
My Lords, the value of the pound is determined by the international market. The fall in exports is mainly due to the current economic crisis, not just in the UK but in Europe as a whole. Half our exports are to the European Union and there are real issues in the European Union. The currency changes that take place quite often have a limited impact due to the very high import content in our exports. Hence any depreciation or the value of the pound going down will not have real impact on our exports.
Lord Barnett
My Lords, as competitiveness is not going to be helped in any way by the Chancellor changing his fiscal policy, despite the strongest advice from people he depended on until recently, such as the IMF, can we take it that he will now be totally dependent for improving anything at all on help from the new Governor of the Bank of England through increasing monetary policy, even though it may hurt current inflation?
Lord Popat
My Lords, the Chancellor has the right policies in place to reignite our economy, growth and competitiveness. We are supporting SME exports and have allocated a huge amount of money for infrastructure investment, including some for regional growth. We are encouraging the free flow of funds from the Bank and fiscal consolidation. With regard to the International Monetary Fund, we cannot recover or be competitive without addressing the huge debt that we have incurred over the past 10 years. Our most important priority is to see how we reduce our national debt.
Lord Hamilton of Epsom
Does my noble friend accept that the key to competitiveness is competition, and that this therefore makes it extremely difficult to improve competitiveness in large nationalised monopolies such as health and education?
Lord Popat
My noble friend raises a very important issue. In both health and education, there is very much a monopoly. We use the private sector in areas where it can deliver real value for money for taxpayers.
Succession to the Crown Bill
(11 years ago)
Lords ChamberRead Full debate Read Hansard Text Read Debate Ministerial Extracts
Lord Cormack
Lord Cormack
My Lords, this is the third time that I have raised this subject on the Floor of the House and I hope that my noble and learned friend will feel that this amendment is more modest and more acceptable than the two previous ones. The background is that the monarch in our country is also the Supreme Governor of the Church of England. Whether we use a modern or—as I personally prefer—a traditional liturgy on Sundays, and whenever we pray for the monarch, we pray for the Queen as the Supreme Governor. Because of the importance of this, and of establishment in our country, many of us feel that this Bill, to which we do not take exception in its main provisions, ought to have in it a recognition of this basic fact.
This modest amendment seeks to make explicit what is already implicit. When he replied to my amendment on Report, my noble and learned friend Lord Wallace of Tankerness—with whom I have had a number of discussions on this matter, for which I am extremely grateful—made quite plain that the monarch could not be a Roman Catholic, even though this Bill allows for successors to the Crown to marry Roman Catholics. This amendment does not in any sense cut across that and does not make any reference at all to the gender issue, which has been accepted throughout the House and in another place. What it very modestly seeks to do is to insert the following few words before Clause 2:
“Notwithstanding the continuing statutory requirement that no Roman Catholic can succeed to the throne”.
Then, of course, the clause continues, as in the Bill, stating that,
“a person is not disqualified from succeeding to the Crown or from possessing it as a result of marrying a person of the Roman Catholic faith”.
Therefore, there is absolutely no alteration to what is in the Bill. The amendment merely seeks to tackle what the right reverend Prelate the Bishop of Guildford said in his speech on Report about ambiguity. He gave an encouraging account of ecumenical relations and we were extremely grateful to him for that. Towards the conclusion of his speech, he also recognised that there was a continuing degree of ambiguity and expressed the hope that that could be tackled, either in the Bill, in an exchange of letters or in some other form.
The Lord Bishop of Guildford
My Lords, the noble Lord, Lord Cormack, has made generous and kind reference to my contribution on Report and I do not intend to labour and repeat the detailed comments that I made to the House on my understanding both of Roman Catholic canon law and realistic pastoral practice in the case of mixed marriages. I thought afterwards that here was a Church of England bishop getting up with the temerity to talk about what the Roman Catholic Church teaches and does. Therefore, I thought that I had better write to Archbishop Vincent Nichols and ask whether my contribution, as recorded in Hansard, was the case.
I have a letter in my hand from Marcus Stock, general secretary of the Catholic Bishops’ Conference of England and Wales, on behalf of the Archbishop. Speaking in that capacity, as well as in a Westminster capacity, Marcus Stock gives me full permission to share this letter with the noble and learned Lord the Minister. I have indeed done that; he may wish to make reference to it himself, and to earlier conversations with the Cabinet Office. That will presumably come out a little later.
I simply say that the exposition of what I understand to be Roman Catholic official teaching in canon law, and the pastoral and flexible practice in terms of the Roman Catholic rules over the upbringing of children in mixed marriages is completely confirmed in the letter that I have received. It was also his clear indication that this should be passed on to the Minister, which I have done. So I will not take up more of your Lordships’ time but say simply that what I said on Report is indeed the case in terms of Roman Catholic law and practice. I believe that should give some assurance with regard to the important matter raised by the noble Lord, Lord Cormack.
Lord Cormack
Of course, the right reverend Prelate and I have discussed this privately and in the company of others. Does he accept that the incorporation of this amendment into the Bill would in no way cast any different doubts or cause any problems with what he has just referred to?
The Lord Bishop of Guildford
I do not believe that that would be the case. Of course, it is up to your Lordships’ House to reach a decision on the amendment should the noble Lord, Lord Cormack, press it.
Lord Lea of Crondall
My Lords, is it not the case that when the right reverend Prelate the Bishop of Guildford made his statement previously, one or two of us asked whether that could somehow be put on the record in a more secure form? Is this not exactly the sort of way in which it could be put on record? Surely that sort of gloss, understanding or undertaking—however one wants to express it—by the Roman Catholic Church is worth more than an amendment, and I hope that the noble Lord, Lord Cormack, will perhaps consider that to be the case.
Lord Deben
My Lords, I hope that my noble friend Lord Cormack will think again about this amendment. It is a very difficult situation—we are where we are—but if you read the Act of Succession, you see words which none of us in this House would like to see applied today to Her Majesty’s Roman Catholic subjects, all of whom pray for Her Majesty every Sunday and every Mass. It is very difficult for us to take what is a piece of rampant discrimination. Frankly, for many of us, particularly the ex-Anglicans, the whole concept of a secular monarch being Supreme Governor of the Church of England is very odd, but we are where we are.
I merely ask my noble friend not to rub this in by adding yet more to it. Let us accept that both sides have come to what is an uneasy compromise in a world which thinks utterly differently. If you read the Act of Settlement, you have to wonder what the rest of the world must think about us tinkering with something that frankly ought not to be part of the constitution of the United Kingdom because it does not have anything to do with our view about equality and difference in a society such as ours. It is because of our history and we understand that and do not want to raise that, but please let us accept where the Government are.
I urge my noble friend not to press this. It is bad enough anyway. This merely makes it worse, and it would be helpful for my noble friend to recognise the degree of reticence on the Roman Catholic side on this issue, for many years and again now. Following the great wisdom that we have heard from the right reverend Prelate, this seems to be the moment to let it lie and to withdraw this amendment.
Lord Trefgarne
My Lords, I take a slightly different view from that of my noble friend Lord Deben and indeed have some sympathy with the amendment proposed by my noble friend Lord Cormack. As I see it, the Bill in its present form paves the way, possibly, for the heir to the Throne and hence the occupant of the Throne to be a Roman Catholic—although I know that there are other provisions that prevent that—and at the same time Supreme Governor of the Church of England. That seems to be an absurdity which has not been addressed by the Bill although it was pointed out in earlier stages.
I am happy to be told that I am entirely wrong in all this, that I have misunderstood that it will not happen and that there are ways and means of preventing it, in which case that is a good thing. That said, the position of the Roman Catholics as described by my noble friend is an important one, which likewise needs to be taken into account. I shall have a little bit more to say when we get to the Motion that the Bill do now pass, but for the mean time I address my remarks only to the amendment of my noble friend.
Lord Janvrin
I declare an interest as a former member of the Royal Household and I pay tribute to the desire of the noble Lord, Lord Cormack, to see this important point discussed in this House. What has just been said about making explicit what is implicit is important, but this amendment is not absolutely necessary. There are three reasons for that.
First, as has just been stated, we are where we are, clearly, with the Act of Settlement and the law of the land that the monarch must be in communion with the Church of England. Secondly, we have heard on several occasions that whereas there is legal certainty about where we stand in terms of the Church of England, the Catholic position on mixed marriages is more flexible and nuanced in its term that it is a pastoral matter. That is important. Thirdly, there is a precedent. There is a mixed marriage in the Royal Family where the children have been brought up as members of the Church of England.
My concern is that if we in the United Kingdom start introducing amendments that are not absolutely necessary, there may be desires in other realms to do the same and to start unravelling what is a most important piece of legislation that will strengthen the monarchy. I hope that in considering whether to go ahead with this amendment we can bear in mind that we must not allow a compromise across the realms to be undermined for the sake of something that is nice to have but not absolutely necessary.
Lord Fellowes
My Lords, in the light of the reassuring words of the right reverend Prelate the Bishop of Guildford, I wish to speak only for a moment on the subject of this amendment. I find very little fault with it. The fault that I do find is not in the amendment but in the effect it may have in reopening debate on others of the Queen’s realms. That may possibly give rise to other amendments that we would find less welcome. I have sympathy with the amendment and the motives behind it but I must say that I am not able to support it in this instance.
Lord Luce
My Lords, I am sure that the Minister will have concluded that raising the legislation with the other realms would create considerable complications. If I understood the noble Lord, Lord Cormack, aright, he was making it plain that the purpose of this amendment was to try to remove any misunderstandings that may still exist about the position of the Roman Catholic Church in connection with the children in line of succession arising from a mixed marriage.
In the debates that we have had over past few weeks, not least on Report, there has been considerable clarification. The Minister has said a lot more since the Second Reading and above all the right reverend Prelate the Bishop of Guildford has set out very clearly what he perceives to be the position of the Roman Catholic Church. The only thing that is missing is a clear endorsement of its position, as expressed by the right reverend Prelate, by representatives of the Archbishop of Westminster, or by the Archbishop himself. Given the remarkable progress that has been made in relations between the Church of England and the Roman Catholic Church it would be helpful to have that endorsement. I hope that the Minister can help us in that regard.
Lord Stevenson of Balmacara
My Lords, like several noble Lords who have just spoken, I take the view that this would insert into the Bill an unnecessary recital with no legal force. It would have the complication, as has been mentioned, of making it more complex and difficult to obtain agreement among all the 16 realms that need to agree to the proposals.
The intention of the noble Lord, Lord Cormack, is to seek further reassurance that despite the removal of the ban on Catholic marriages, no Catholic could ever succeed to the throne. He and others have made this point with some force throughout our debates. However, I wonder, as the noble Lord, Lord Deben, said, whether we are not pushing too hard on this point. Obviously the case has been made in an attempt to ensure that the Anglican supremacy is preserved. However, all that it serves to do is push our attention further toward the fact that the removal of the ban on Catholic marriages—obviously a welcome measure in itself—exposes the religious discriminations that remain. That is, no one who is a Catholic or who is not in communion with the Church of England can succeed to the throne.
It has been said that we are where we are, and I have some sympathy with that. However, we as a Parliament will need to return to some of these points in the not too distant future.
The Advocate-General for Scotland (Lord Wallace of Tankerness)
My Lords, I understand that in tabling the amendment my noble friend Lord Cormack sought to put beyond doubt the requirement that the sovereign be a Protestant and in communion with the Church of England. I readily recognise the concerns expressed by my noble friend; at every stage of the Bill, he has clearly sought to find a means of addressing them. I readily acknowledge that this amendment is, to use his words, more modest than those that he moved in Committee and on Report. However, as has been indicated in our short debate, the Government believe that it is unnecessary as both the Bill of Rights and the Act of Settlement are unambiguous with regard to the requirement that the sovereign be a Protestant and in communion with the Church of England.
The Bill does not pave the way to change that. No one who is not in communion with the Church of England may ascend the throne. That rules out Roman Catholics as well as many other people. I have concerns that by attempting to reiterate this, and to single out the peculiar and particular prohibition on Roman Catholics, one risks causing offence. I am sure that that was not intended, but one does risk causing offence to many of Her Majesty’s loyal subjects when there is no good reason in law to do so. I do not believe that we should put into a Bill words that could cause unnecessary offence and reopen wounds. It has also been said that the amendment is unnecessary in law and could therefore lead to other jurisdictions that have responsibilities in this regard putting forward amendments and unpicking an agreement that has been very carefully constructed across the realms over a considerable time.
As the Supreme Governor of the Church of England, the sovereign must be both Protestant and in communion with the Church of England. For this reason, we are not removing the bar on Roman Catholics acceding to the throne, as set out in the Act of Settlement and Bill of Rights. Of course, we have heard expressed in a number of our debates the perceived problem of the heir to the throne marrying a person of another faith. That problem exists under present law; it is not one created by the Bill. Clause 2 merely provides parity of treatment between Roman Catholics and people of all other non-Protestant faiths.
Nevertheless, I have recognised and understand the profound concerns that have been expressed. As the House knows, following a commitment made in Committee, I met Monsignor Stock on behalf of Archbishop Nichols and the Catholic Bishops’ Conference of England and Wales to discuss this matter. As the right reverend Prelate the Bishop of Guildford indicated, Archbishop Nichols indicated that the wording had been discussed with the Cabinet Office. I have the specific consent of Monsignor Stock to say that he was speaking on behalf of Archbishop Nichols as president of the Catholic Bishops’ Conference of England and Wales, and can inform the House that the view taken by the Catholic Church in England and Wales is that in the instance of mixed marriages the approach of the Catholic Church is pastoral. It will always look to provide guidance that supports and strengthens the unity and indissolubility of the marriage. In this context the Catholic Church expects Catholic spouses to sincerely undertake to do all that they can to raise children in the Catholic Church. Where it has not been possible for the child of a mixed marriage to be brought up as a Catholic, the Catholic parent does not fall subject to the censure of canon law.
Lord Trefgarne
Would it be possible for a copy of this letter to be placed in the Library of the House?
Lord Wallace of Tankerness
My Lords, this was not a letter, it was a form of words that was agreed between Monsignor Stock and the Cabinet Office that I have placed on the record. There was a letter to me from the right reverend Prelate the Bishop of Guildford that enclosed a copy of a letter that indicated what I have just said. I do not believe that it is in my gift to say that it will be placed in the Library, but I reassure my noble friend that I have just used the words that were in that letter. I thank the right reverend Prelate the Bishop of Guildford for his contribution to our debates, both today and on Report, and for what he did following Report in engaging further with Monsignor Stock and the Catholic Bishops’ Conference of England and Wales. Indeed, on Report the right reverend Prelate, in a speech that I believe was very helpful to the House, concluded that the teaching of the Catholic Church on this matter,
“bears out the Government’s assurance that the Roman Catholic rules are not a block to the smooth functioning of the proposed succession rules”. —[Official Report, 13/3/13; col. 282.]
As I have stated both in Committee and on Report, we have a very clear signal that the overriding concern in Catholic pastoral guidance to couples in mixed marriages is the unity and indissolubility of the marriage. We have an equally clear signal from the Church of England, included in their briefing note to Members, that:
“The present prohibition … is not necessary to support the requirement that the Sovereign join in communion with the Church of England”.
Again, I recognise the concern with which my noble friend moved his amendment. I reiterate that the requirement that the sovereign be a Protestant remains as solidly placed in law as ever. In this context, I invite him to withdraw his amendment.
Lord Cormack
My Lords, I am grateful to those who have taken part in this brief but, I think, important debate. I listened with particular care to the speech of the right reverend Prelate and, of course, to what my noble and learned friend said. I believe that we have gone some distance in our three debates. We now have certain statements on the record that I believe are helpful to those of us who have concerns but are in no sense anti-Roman Catholic. My noble friend Lord Deben knows that when he left the Anglican Church to become a Roman Catholic, I honoured him for that decision. A similar decision was made by Miss Ann Widdecombe. I myself agonised at that time although in the end, instead of joining the Roman Catholic Church, I found myself elected to the General Synod to take the place that my noble friend had vacated.
I believe very much in the importance of our established church. However I may die, whether as an Anglican or as a Roman Catholic, I hope that the Church of England will continue as the established church of England. It is because of that, and because our constitution, as has often been said, is like a beautifully constructed watch, in that if you take one little piece out the whole thing will fall apart, that I have expressed my concern in three brief debates. The last thing I wish to do is to cause offence to anyone, particularly Roman Catholics, as I hold the Roman Catholic Church in high regard and always have. I very cheerfully pray, as we do frequently in Anglican churches, for the Pope. I would have liked to have seen something in the Bill that made explicit what is implicit, but I understand the points that have been made, particularly by the noble Lords, Lord Janvrin, Lord Fellowes and Lord Luce. Because I think that we have moved some distance, I will spare the House the exercise of going into the Division Lobbies.
On a final note, I hope that something can go into the Library of the House, as requested by my noble friend Lord Trefgarne. When I concluded my speech at the end of Report, I expressed the hope that at a fairly high level there could be an exchange of letters, and I hope that that is still possible.
I thank my noble and learned friend for the concern and sympathy with which he has listened to the arguments advanced. I beg leave to withdraw the amendment.
Lord James of Blackheath
“Union with Scotland Act 17066 In Article XXV, Section 2 of the Union with Scotland Act 1706, for “preserve the foresaid Settlement of the true Protestant Religion with the Government Worship Discipline right and Privileges of this Church as above established by the Laws of this Kingdom in Prosecution of the Claim of Right” substitute “preserve the declaration, uphold and maintain the rights and subject specified therein”.
Accession Declaration Act 19107 In the Schedule to the Accession Declaration Act 1910, for “according to the true intent of the enactments which secure the Protestant succession to the Throne of my Realm, uphold and maintain the said enactments to the best of my powers according to law” substitute “according to the true intention to the declaration, uphold and maintain the rights and subject specified therein”.”
Lord James of Blackheath
My Lords, this is in the nature of being a semi-probing amendment. I want to test the extent to which we have arrived collectively at answers to each of the four questions that I have developed through the currency of this Bill, and see whether my noble and learned friend the Minister can satisfy us, in his conclusions, that each of the tripwires and pitfalls that we have seen are now capable of being avoided. I come to this very much in the spirit of the finest executive I ever had the privilege of working with, who used to say, “Don’t give me people around me who know all the answers. I want the people who know all the questions”. It is in that spirit that I come, even though I stand here as somebody without any shred of qualification. I do not even have an 11-plus pass. Given that circumstance, it might be said that I have a right nerve to stand up here and ask these questions today in such an intensely legal affair but then, on the other hand, somebody has to.
In all this, I start by expressing my appreciation to my noble and learned friend the Minister for the considerable time, and the enormous patience and care, that he has given to answering each of the questions that I have raised directly with him. He has been absolutely splendid. My noble and learned friend will not be surprised to hear that while I have read every word he has written with great care, that is not the same as agreeing with every word I have read. It is clear that the principal point of difference between us is that he believes that I am relying on the entrenched status, as such, whereas it is the status and ordinary meaning of the statute law as it now stands, and as it relates to our duty and the Crown’s duty, that concerns me. I repeat: our duty and the Crown’s duty, which I do not believe are the same thing.
I was grateful to the Bill Office for agreeing to write to the Clerk of the House of Commons to ask what basis of interpretation it had placed on the use of a delegation of the royal prerogative in addressing its own debate on this subject. If I understand the very complicated answer correctly, it is along the following lines. The Crown cannot delegate something that it does not posses; it can delegate only the authority that it has, in which case it can delegate the power to us to give an opinion as to whether we want a Bill to pass and say “Content”, but it cannot delegate to us the authority to give it assent. That is retained by the Crown in all cases.
However, the Crown has to adhere to that in strict accordance with the coronation and proclamation oaths which precede it. Those oaths, passed through the Declaration of Rights in 1689, relate to all the powers that the Crown rightly held before the revolution. It ensured that the Crown could no longer deny that it was bound by the statute law with explicit changes to the coronation oath, made by enacting the Coronation Oath Act 1688. The settlement has been said by Her Majesty, on the occasion of the 300th anniversary of that great document, to be the sure foundation of our constitution. I am sure that Her Majesty would take that same view without any amendment today. It will be interesting to see, when and if the Bill passes to her for Royal Assent, how she will interpret that obligation in the context of those oaths.
The vulnerability here would arise if the passage of the Bill was deemed to represent a precedent by which to justify far more draconian changes than could be permitted to the established laws of this land under the Bill of Rights and to the detriment of the rights and liberties of the subject. By relying on such a precedent, in theory it is possible to introduce arbitrary power with a Bill of no greater apparent significance than this, to reintroduce the use of judicial torture or repeal the principle of “no taxation without representation”. These are, clearly, highly undesirable outcomes.
If this Bill is enacted with the addition of the amendment that I have proposed, from the next accession and beyond we would have the satisfaction—albeit that there may be a vulnerability prior to that accession —of knowing that the fundamental rights and liberties of the subjects have been restored absolutely. As such, I commend my measure as an opportunity that we ought to take. It is like a deep third man, in cricketing terms, by sweeping up all the bits that might otherwise trickle through. I commend my measure as an opportunity that we ought to take to hope, and later ensure, that no precedent might arise from this to the detriment of the rights and liberties of the subject. If we pass the Bill we risk setting a precedent with the potential for the worst possible outcome in the fullness of time, not knowing what future Governments and future authorities might wish to be brought to bear.
Lord Eden of Winton
My Lords, this is a bit of a minefield, so I tread with care and trepidation. I will make a very brief intervention, primarily to say to my noble friend how much I recognise the concerns he has expressed and the care with which he has followed these matters through. I know that he is extremely anxious, not only on his own behalf but on our collective behalf, that the legislation now going through the House is correct in so far as it seeks to affect the role and rights of the sovereign and sovereign succession and that it in no way undermines the position of any Member of your Lordships’ House, let alone that of any citizen outside the House.
I believe that the main answer to the questions that my noble friend raises rests in the sovereignty of Parliament. It is, as I perceive it, the right of Parliament to make alterations to legislation, even including the Bill of Rights. As I interpret it, the primary purpose of the Bill of Rights was to protect the interests and the rights of the people. The rights of the people are currently preserved in the powers and obligations of the Houses of Parliament and of the Government of the day. It is for us to make such amendments as we feel are necessary or desirable. In this particular case, a narrow amendment is being suggested which in a way underlines what was required of the sovereign at the time of the Bill of Rights; namely, that the heir to the Throne shall be a Protestant. There is nothing more to it than that. It therefore seems to me that we are exercising a traditional and constitutional right of Parliament to make amendments and alternations as we think proper. We are not in any way going against the obligations or commitments of the Crown. In carrying these matters forward, we shall be preserving the constitutional requirement in this country that the future monarch shall be a Protestant and a practising communicant member of the Church of England.
I do not think that the worries and anxieties my noble friend has expressed so profoundly are justified and, as he himself said, my noble and learned friend the Minister has given a great deal of care and attention to these issues and has written a letter of some considerable length to him that certainly satisfied me in the arguments put forward.
Lord Wallace of Tankerness
My Lords, I certainly understand that my noble friend Lord James of Blackheath has had serious, profound concerns about this Bill which he expressed even before Second Reading. I recognise the persistence and diligence with which he has continued to raise these issues. I am grateful for his kind comments and I think he would recognise that the comments and concerns he has raised have been given proper consideration.
It appears to me that my noble friend is concerned that, in allowing an heir to the Throne to marry a Catholic, this Bill would contravene the promises that each sovereign is required to make to maintain the established Protestant religion and in some way subvert the Bill of Rights or the Act of Settlement. It will come as no surprise to my noble friend that I disagree with his view, as I have made clear on a number of occasions in your Lordships’ House. Again, I want to make it quite clear that we are not amending the provisions of the Bill of Rights or the Act of Settlement which say that the sovereign has to be a Protestant.
My noble friend Lord Eden of Winton put his finger on the point. Indeed, I wrote at some length in my letter to my noble friend Lord James about the sovereignty of Parliament in the case of Jackson v Attorney-General in which the House of Lords considered the Parliament Act 1911. The late Lord Bingham said:
“The bedrock of the British constitution is, and in 1911 was, the supremacy of the Crown in Parliament … Then, as now, the Crown in Parliament was unconstrained by any entrenched or codified constitution. It could make or unmake any law it wished”.
With a former Lord Advocate, the noble and learned Lord, Lord Hardie, present, I had better say that there has been some question about that in some respects in Scotland following the dicta of Lord President Cooper in MacCormick v Lord Advocate. Nevertheless, Lord Bingham expressed that view very clearly in the Jackson case.
Given that the prohibition on the sovereign being a Catholic remains, we do not believe that there is any conflict between the Bill and the Accession Declaration or the promise made by the sovereign to preserve the Presbyterian Church in Scotland. I do not think I can really elaborate on it. My noble friend and I are going to have to agree to disagree because we believe that there is nothing in this Bill which subverts the Bill of Rights, the Act of Settlement or the oath which Her Majesty made on her accession. In the circumstances, I invite my noble friend to withdraw his amendment.
Lord James of Blackheath
I thank the Minister for his reply. I reassure him immediately that my concern here is not about the religion of the monarch. I gave up religion at the age of 19 when I was studying for ordination to the Church of England. I discovered that while the Catholics burnt people because they thought it released the soul to go to heaven quicker in order to plead for mercy, the Protestant church was allowing hanging, drawing and quartering on the forecourt of St Paul’s Cathedral—where we all walked last week—to be able to discharge the secular crime of treason under the guise of being a religious crime against the church. At that point my faith crumbled very rapidly and was never restored.
My concern here is not primarily those factors. It is that we are putting Her Majesty in a position where we are asking her to breach the coronation oath, which I would not do under any circumstances. I have provided a suggestion as to how we may circumvent that by borrowing an initiative of the Duke of Wellington from 120 years ago, but none the less we need to be sure that it would work and that is my concern. If the noble Lord will answer that, I will be happy to withdraw my amendment.
Lord Wallace of Tankerness
My Lords, I indicated on Report that I would report to the House once the necessary steps in each realm had been completed and we were in a position to commence the legislation simultaneously. I reiterate that commitment. As it may be of interest to your Lordships, I can inform the House that since our debate on Report, Royal Assent was given to the Canadian Succession to the Throne Act on 27 March. We received confirmation from the Government of Antigua and Barbuda that, based on the nature of their constitution, they will not need to legislate to give the changes effect, and that the Council of Australian Governments agreed on 19 April, last Friday, to a process to change their laws.
As I have indicated on a number of occasions, the provisions in this Bill have been carefully worked out in agreement with the realms, and it is important that we now proceed to pass this Bill and show that we have been able to fulfil the task asked of us by the realm Prime Ministers in Perth in 2001. It is an important piece of legislation that has its roots in securing better equality, and certainly we await with great expectation the birth of a child to their Royal Highnesses the Duke and Duchess of Cambridge. We wish them every health, in particular the Duchess as she proceeds towards the birth of her child. In doing so, we know that if this Bill passes, and if the required processes take place in the other realms, that child, irrespective of whether it is a boy or a girl, will take its place in line to the throne ahead of any subsequent siblings. Therefore, I beg to move that this Bill do now pass.
Lord Trefgarne
My Lords, I do not intend to delay the passage of this Bill for more than a few moments. It is sad that this Bill has been driven through with such speed. Many of us would have preferred a Joint Select Committee, for example, to consider some of the important constitutional implications that it raises, and indeed changes. However, that has not been the case, and therefore that, for now at least, must be that. This Bill has also set running the hare of what happens to the hereditary peerage with regard to the succession arrangements for hereditary peers. I must tell your Lordships that those arrangements are, as I understand it, a great deal more complicated even than they are for the Crown. I dare say that if Bills come forward for that purpose they will delay the noble and learned Lord very much longer than this Bill has.
Growth and Infrastructure Bill
19:10 - Division on Motion B1 - Ayes: 260 / Noes: 191 - Motion B1 agreed.
“Development orders: development within the curtilage of a dwelling house
(1) Section 61 of the Town and Country Planning Act 1990 (development orders: supplementary provisions) is amended as follows.
(2) After subsection (3) insert—
“(4) Any development order or amendment to an existing development order made after 1 January 2013 that grants planning permission for development within the curtilage of a dwelling house shall not apply within the jurisdiction of a local planning authority if that authority has resolved that it shall not.””
Commons disagreement and reason
The Commons disagree to Lords Amendment No. 7 for the following Reason—
Baroness Hanham
“(2B) Without prejudice to the generality of subsection (1), a development order may include provision for ensuring—
(a) that, before a person in reliance on planning permission granted by the order carries out development of land in England that is a dwelling house or is within the curtilage of a dwelling house—
(i) a written description, and a plan, of the proposed development are given to the local planning authority,
(ii) notice of the proposed development, and of the period during which representations about it may be made to the local planning authority, is served by the local planning authority on the owner or occupier of any adjoining premises, and
(iii) that period has ended, and
(b) that, where within that period an owner or occupier of any adjoining premises objects to the proposed development, it may be carried out in reliance on the permission only if the local planning authority consider that it would not have an unacceptable impact on the amenity of adjoining premises.
(2C) In subsection (2B) “adjoining premises” includes any land adjoining—
(c) the dwelling house concerned, or
(d) the boundary of its curtilage.””
The Parliamentary Under-Secretary of State, Department for Communities and Local Government (Baroness Hanham)
My Lords, at Third Reading this House made an amendment to provide local authorities with further powers to disapply planning permission granted by a development order. As the House will be aware, the Commons noted the commitment made by the Secretary of State when discussing these issues to give further consideration to the concerns of both Houses, and it disagreed with this amendment.
Members of both Houses will have received from the Secretary of State a letter, which I forwarded to them, giving the result of his review of the situation, which has resulted in the amendment that we laid on Friday, and which we will now discuss. It may be helpful if I briefly outline again the thinking behind our proposal on extending the existing permitted development rights for homeowners wishing to extend their property. As I said at an earlier stage of the Bill’s consideration, these changes will make it easier for thousands of families to undertake improvements to their homes. In bringing forward these changes, we have looked across England and recognised that many people want to enlarge their homes. They want to do so not by much but sufficiently to create more living space, perhaps to care for elderly relatives or because of a growing family, and without the cost of having to relocate.
However, we have been clear from the outset that it is important to ensure that any impact on neighbours is acceptable. Concerns on this issue have been set out in this House by noble Lords in previous statements, by Members in the other place and in responses to our consultation. As I have said, the Secretary of State made a commitment in the other place that we would respond to these by bringing forward a revised approach.
I have tabled an amendment that delivers that commitment. This amendment makes it possible for the Government to put in place protections for neighbours where adjoining homeowners seek to use our proposed extension to their permitted development rights. We have reflected on the concerns raised by noble Lords. The noble Lord, Lord True, raised the issue of the rights of neighbours to protect the amenity of their homes eloquently on Report; the noble Lord, Lord Tope, expressed concerns that our proposals would set neighbour against neighbour; and, as the noble Lord, Lord McKenzie, put it, neighbours can impact dramatically on their neighbours’ quality of life. The amendment that we are proposing responds directly to this important issue.
In drafting our amendment, we have drawn on the principles outlined in the 2007 report Blueprint for a Green Economy from the Quality of Life Policy Group, which was chaired by the noble Lord, Lord Deben, in his previous life and Zac Goldsmith MP. Indeed, the noble Lord referred to this very report when arguing against the amendment that was made to the Bill at Third Reading. The Quality of Life report states that:
“Too much planning has become development control”.
It goes on to say that,
“the time and trouble that has been spent on dealing with planning applications for extensions and additions, porches and garages … cannot be seriously said to have been cost-effective”.
We agree with that, and with the report’s message that protecting neighbours’ amenity is important.
We are therefore introducing a light-touch neighbourhood consultation scheme. This recognises concerns that larger extensions could be built without offering neighbours any opportunity to express their views. Adjoining neighbours—not just the ones on either side but those who adjoin the rear of the property as well—will now be consulted where a homeowner wishes to use the new extended permitted development rights to build a good-sized extension. If neighbours think that the proposed extension will have an unacceptable impact on their amenity, they can ask the local planning authority to consider this—for example, if they think that it would totally overshadow their living space or that they would lose their privacy due to overlooking windows. Where neighbours raise concerns with the local authority, it will then consider the impact of the proposals on the amenity of those neighbours. It will make an objective decision on whether the development is acceptable or if the impact on neighbours’ amenity is such that it should not go ahead under permitted development rights.
We recognise that neighbours will have very different views on whether an extension impacts on their amenity, and that similar proposals on the same street may therefore have different outcomes. If a local authority is asked to consider the impacts of a proposal it will look at this on a case-specific basis. The outcome will not necessarily be the same as for other extensions in the street.
As the Secretary of State has made clear, local ward councillors will, in the usual way, have the opportunity to put forward their views on the desirability or otherwise of a proposed extension. The process for dealing with an indication that an extension is proposed will be that a homeowner wishing to build an extension will notify the local planning authority and provide plans and a written description of the proposal. The local authority will notify the adjoining neighbours—that is, the owners or occupiers of properties that share a boundary, including those at the rear. We will set out the details in secondary legislation but the intention is that neighbours will have 21 days in which to make an objection. If no neighbours object, the local authority will notify the home owner that they are able to proceed with the development. If any neighbour raises an objection, the local authority will then consider the case on the single issue of whether the impact of the proposed extension on the amenity of neighbours is acceptable.
It will be up to individual councils to decide how they handle the consideration of these proposals. We would expect it to work in the same way as for planning decisions: that is, for the council to decide whether the decisions are delegated to officers or made by a planning committee. If approval is not given, the home owner will be able to appeal against a refusal or may wish to submit a full planning application. The home owner will be able to appeal against a refusal of consent but, as with normal planning consents, neighbours will not be able to appeal against a grant of permission. This approval process will not be onerous and we do not expect that it will impose significant costs on local authorities, but we will discuss this and other implementation issues with the Local Government Association.
These proposals should remove the need for local authorities to feel that they have to resort to using Article 4 directions to remove the new permitted development rights. I assure noble Lords that we have listened very carefully to the concerns raised about the operation of Article 4, and we will work with the Local Government Association to update our Article 4 guidance as part of the review by the noble Lord, Lord Taylor of Goss Moor. This will make sure that the process is as clear and straightforward as possible.
The noble Lord, Lord True, clearly set out that he was concerned that our proposals took away,
“a neighbour’s right to have a say on a big and potentially overbearing extension shoved up outside their back door”.—[Official Report, 26/3/13; col. 982.]
As the Secretary of State made clear, we have listened to Parliament and responded directly to these concerns. The amendment gives local authorities a role where neighbours ask them to make a judgment while allowing home owners across the country equal opportunity to make use of the new permitted development rights. I look forward to hearing the views of the House. I hope that I have explained as clearly as I can how our amendment addresses the concerns raised about the impact of our proposals on neighbours and why, therefore, the House should agree with the other place that the amendment made here at Third Reading should not become part of the Bill. I beg to move.
Motion A1
Lord McKenzie of Luton
As an amendment to Motion A, leave out from “House” to end and insert “do insist on its Amendment 7”.
Lord McKenzie of Luton
My Lords, I should explain that we tabled this Motion, which insists on the position originally taken by your Lordships, as the clock was ticking on Friday without our then having sight of the government amendment. The Secretary of State, in announcing an uncharacteristic conversion to the spirit of consensus, gave neither us nor the Commons a clue as to what this revised approach to permitted development rights for home extensions might be. We have to continue to deliberate on these matters without the benefit of the results of the consultation on extended permitted development rights that concluded some four months ago. It is difficult to believe that they would not have some relevance to the matter in hand, yet still the information is withheld from us. However, I hope that the Minister might at least confirm one point for us this afternoon. The consultation included the proposal that changes to permitted development rights, including those relating to the curtilage of a dwelling house, should be in place only for three years and that developments would have to be completed within that three-year period. Does the consultation support that proposition?
We now have sight of the government amendment, and the benefit of correspondence from Ministers, and have to assess how far it addresses the concerns prompted by the amendment moved so comprehensively by the noble Lord, Lord True, an amendment that found favour around your Lordships’ House and that clearly had considerable support in the House of Commons. I do not propose to restate in depth the points made by the noble Lord, Lord True, and others with which we agreed, other than to say that the amendment reflects a demonstrably localist approach, scepticism that the extension of these particular permitted development rights would make a meaningful contribution to kick-starting growth, concerns that an unamended Article 4 direction process was not inevitably a secure or speedy route for local councils to override inappropriate centrally set permitted development rights, an acknowledgement that individuals can pursue planning permission in the absence of permitted development rights and, in the words of the noble Lord, Lord True, that the Government’s proposal,
“takes away a neighbour's right to have a say on a big and potentially overbearing extension shoved up outside their back door. What is more, it removes that vital process of moderation and conciliation that the local planning system provides in these matters”.—[Official Report, 26/3/13; col. 982.]
Baroness Gardner of Parkes
My Lords, I noticed that many of the views expressed by the spokesman for the Opposition agreed with points that I think are important and on which I therefore wish briefly to comment. The most important thing of all—from my own experience I found this very unsatisfactory—is that you cannot rely on getting notification. In cases in the past 12 months where I have been the immediate neighbour, I have twice not received notification. Secondly, clever people always put in their applications on Christmas Eve or at some time when they know that no one is around. It is important in those circumstances that extra time is allowed for the consultation based on the number of working days, not just days. The unprincipled policy is used regularly by clever people, even under normal planning regulations. Those two matters are important.
On other issues, I have been satisfied by discussions with the Minister that the Government really are thinking about these matters. The sunset clause is good but, for notification, the system that has been in use for years should be continued whereby a notice is posted on a lamp post, a hedge or something like that, so that some friend or neighbour passing by would say, “Did you see that they are building something next door to you?”. Even if you are away on holiday, you can ask your friend to let you know. However, if you come back from a three-week holiday, which is not unusually long—particularly if you go to Australia; it is hardly worth going if it is any less than that—it is important to be sure that nothing underhand is going to be slipped through in your absence.
Lord Shipley
My Lords, I should declare my interest as a vice-president of the Local Government Association. I have had many concerns in recent months over the proposals on permitted development. However, I am grateful to the Minister for these proposals, albeit that they were revised at the last moment. They go a long way towards improving the proposals on permitted development.
It would have been wrong to deny neighbours the right to object to an extension that might impact on the amenity of their property, particularly given the significant increase proposed in the scope of permitted development. While I am conscious that some 90 % of current planning applications are approved and only 10% are turned down, clearly the increase in the proposed permitted development level will produce a higher proportion of applications that are going to be challenged by neighbours. I agree with quite a number of the points made by the noble Lord, Lord McKenzie, who has asked a set of questions about precisely what detail the Government propose.
The Minister wrote to Members of Parliament explaining what the Government were proposing to do. It would help our understanding of the Government’s amendment if the Minister could clarify some of these details. First, it is stated that home owners wishing to build extensions under the new powers would notify their local council with the details. It is spelt out in some detail in the amendment, but I hope it will be absolutely clear that there should be a covering letter that explains all the detail that a third party might be interested in reading, that there should be a copy of the plan of the architect’s design, and that all details of design and materials should be submitted at that stage. Because of costs, this is not just a matter of planning permissions: it also impacts on building control.
The council is then to inform the adjoining neighbours that a letter and application have been received by a home owner. What does the word “inform” mean? That information should include every single detail that is known about the application so that neighbours who might be affected can make a rational contribution to the application and their views can be properly considered.
The question of who is an adjoining neighbour is defined in this amendment as someone who abuts the curtilage of the property. I suggest that that does not go quite far enough. I think it should be anybody who can see the proposed development site from any point on their property, because it will impact on their amenity if they can see it. But if they are at the diagonal point—in other words, not immediately adjacent to the side or to the bottom of someone’s garden—they may well be able to see the proposed development. Those people should have a right to object as well.
I agree entirely with the suggestion that three weeks is not adequate, partly because there is a tendency for the three weeks to start at the date on which the letter is sent. It seems to me that 28 days would be a better period by which a neighbour should be able to respond.
On the question of objections being received from neighbours, I heard on a news broadcast at the weekend, but perhaps I misinterpreted it, that ward councillors would have a role in making the decision, in arbitrating. I understand that that is not what is being proposed, but I would appreciate the Minister’s confirmation of that fact, because in my view it should go to the council’s planning committee.
Statutory consultees should also have a right to be consulted. I am thinking particularly of parish councils, because they have an existing role and it is important that that role is clearly identified.
On the issue of the fee, I had thought that the planning system was supposed to be financially self-sufficient: that is, that the expenditure on the planning system and planning officers was to be funded from fees received. I am not certain that it is right that someone who has applied for planning permission should not pay a fee. There is a case for saying that if there are no objections to what is a very simple matter, and with the council operating as a post box only, it would be legitimate for there to be no fee. But if it is more complex than that and takes up significantly more of the planning officer’s time, this ought to be looked at again.
Lord Deben
I rise only because my noble friend, like my right honourable friend, has drawn into consultation the Quality of Life report, which I chaired. I declare an interest as a vice-president of the Royal Town Planning Institute and an honorary fellow of the Royal Institute of British Architects. I think it important to rise simply because I would not like the House to believe that what is here in the amendment was what the Quality of Life report actually recommended. The reason for saying that is not because I wish to undermine what the Government have done but because the Government have been less radical than we suggested they should be. We said that in most of these cases it is not a matter of planning but of neighbours. It is a matter of sorting out what is fair dos, based on the principle that we believe in the rights of property. I ought to be able to do whatever I like with my property but I cannot do that in a world as closely knit as we are without taking into account what my neighbours feel about it. We said that it was ridiculous to tie up the planning system of the local authority to do this.
What should happen is that you would have a duty to tell your neighbours what you intended to do, with a plan and the rest of it. They would then have a month—28 days—to tell the local authority that they did not like it. The local authority would then have the right to do three things. First, it would have the right to say, “Well, this is a load of old rubbish and we’re not going to take any notice of it”. That seems perfectly reasonable, as you have to have a judgment in the first instance as to whether people are merely being difficult. We all know there are some people who can be difficult in any circumstances about anything, and anybody on a local authority knows that better than I do. The second thing that the local authority could do would be to say, “We think that this is a serious planning matter”—in other words, it was not a matter of neighbours, but something very fundamental, and it would therefore call it in, in effect, for a planning decision.
However, it would most likely say that this was a matter of neighbours and that they were going to appoint an arbitrator. Local authorities would have a panel of arbitrators, who would be very ordinary people, whose only job would be to go and see what the fair deal or reasonable thing would be in the case. Having decided that perhaps a slightly smaller extension would be fairer as far as the neighbour was concerned, they would say, “We will agree to this, if this change is made”. Alternatively, they would say, “We agree to it entirely”. They would start from the assumption that they would want to agree to the development; in other words, there would be an assumption in favour of development, because that seems to be reasonable given the nature of property.
The Government have taken this up. It is a huge improvement on the previous suggestion and a generous way of moving forward. I think my noble friend Lord True will probably feel that it is not quite what he wanted but we have gone a long way. However, there are three bits to it which I hope that my noble friend will think again about. In no spirit am I complaining about what she is doing—I am very pleased about this—but there are three things. First, I think that 28 days was probably a better period, simply for the reason that it is helpful for people over holidays and the like. Secondly, I wonder whether she could look again at enabling the local authority, even if it were not in the statute, to decide that this kind of thing was done by an arbitrator, not through the planning committee. I wanted to remove from the planning department questions such as, “Can I have a car port? Can I build a room in the already present roof of my garage? Can I put up a bit of an extension which seems quite sensible as my neighbour has exactly the same?”. All those things are really neighbours’ issues, and, frankly, when you consider the time spent and the shortage of planning officers, it is much more sensibly done by having a sensible man or woman looking and saying, “That seems perfectly reasonable”.
Thirdly, I hope that my noble friend will look at the one series of protections that we specifically put in, which is that this would not apply in an area which had been designated as a conservation area. In that area there should be a wider consultation than merely with one’s neighbours. I say to the Minister that I entirely support that it should be one’s contiguous neighbours because frankly, if we are going to go out to everybody who could possibly see the house, we are in real trouble. The idea that I could say that I ought to be able to complain because if I stood on the top of my house with a telescope I could see this house is just nonsensical.
We are trying to have a proper balance, and I think this amendment achieves that. I hope that the Minister will look at those three things, not least because I believe that our original proposition was an easier, simpler and ultimately more radical concept. However, I am pleased that we have had not merely half but three quarters of the cake and thank her very much for that.
Lord Cormack
My Lords, I agree entirely with what my noble friend Lord Deben says about conservation areas. I would like to make one point and ask one question of my noble friend the Minister. Like others, I thank her for the movement that has been made. I enthusiastically supported the amendment of the noble Lord, Lord True, either on Report or Third Reading. It seems that the Government have moved between half and three-quarters of the way.
Does the Government’s movement, which we welcome, take into account the time that it takes to build an extension? We have talked about loss of views and all that sort of thing, which are the obvious points, but some extensions seem to take an unconscionable time to build and the disruption of neighbours’ lives during the building can be not just an aggravation, but in some cases a real health hazard. I would like my noble friend’s assurance that permission to extend does not extend indefinitely.
Lord Beecham
My Lords, I join others in welcoming the Government’s partial, if deathbed, conversion to doing something about these proposals. I certainly endorse many of the comments that have been made about the problems that remain apparently unresolved. I particularly join the noble Lord, Lord Deben, in strongly urging the Government to look again at the issue of conservation areas, unless it is capable of being clarified that the proposals will not apply to conservation areas.
I draw particular attention to the wording of Amendment 7B, where in the preamble it says to insert:
“Without prejudice to the generality of subsection (1), a development order may include provision for ensuring”,
the safeguards to which the Minister referred. Why is that “may”? Why is it not the case that the development order will include these provisions rather than there being an option? It seems to me that it would be all too easy to evade the consequences of the partial progress that the amendment produces if it remains an option simply not to provide that in the subsequent development order.
Lord Phillips of Sudbury
My Lords, very briefly, in my 26 years as legal eagle on the “Jimmy Young Show” on Radio 2, there was no issue more sensitive and more repeatedly brought up than neighbour disputes relating to the extension of premises. It causes immense angst among our fellow citizens. People have mentioned rights of view and rights of light; there is no right of view, of course, and rights of light are notoriously difficult to judge and adjudicate on. I am entirely in favour of my noble friend the Minister trying to ensure that what comes out in the wash—I am thinking particularly of the subsidiary legislation—leaves minimum room for aggravation and disagreement.
For example, can anything be done about defining,
“the curtilage of a dwelling house”,
and the boundary of this? Those sorts of details may not seem important to us here because, I suspect, most of us live in rather spacious houses with gardens, but in terraced accommodation par excellence these issues are of huge importance. I am delighted to hear that the notice period is going to be 28 days but, to be honest, it needs to be 56 because these things can move very slowly and it takes less sophisticated mortals a long time to find out how to deal with some of these matters.
Lord True
My Lords, in rising, I feel rather like the ancient prophetess who went to see King Tarquin with the Sibylline Books and saw six of them promptly burned, only to have them accepted at the last minute. Like her, I am grateful for that. I thank my noble friend Lord Tope, the noble Earl, Lord Lytton, and the noble Lord, Lord McKenzie, for their support for this proposal at an earlier stage.
Of course, I thank my noble friend the Minister for her amendment. Unlike some in this debate, she has always understood the practical, human issues that are involved in seeking to end the rights of objection to developments which, as some have pointed out in this debate, may take more than half of a neighbouring back garden. Crucially, these may also create precedents in local planning in relation to character and new lines of building, which may well affect the person next door but one, who, under the proposal before us, still has no right to a say.
Parliament has secured some movement and I think many householders will thank goodness for your Lordships’ House for the role it has played in securing that. My view has always been—and remains—that faced with potentially overbearing developments, neighbours should have the right to defend the value and amenity of a home. For most of our population, that home represents the focus of all their lifelong work and aspiration and the bulk of their family’s wealth. That is the fundamental point. With the help of colleagues in another place and many of your Lordships, people in the Local Government Association and the local government world, and so many other people—ordinary people—this has finally been vindicated. I am very grateful to the Government for laying an amendment to protect these rights.
The question is: what do we do now? The noble Lord, Lord McKenzie of Luton, to whom I pay tribute for his role in not only this but all our local government debates, says that we should insist on the amendment for which I secured your Lordships’ support at an earlier stage. It is true that the Government’s amendment was laid before the House at the last possible moment last Friday. I might agree with him that it would have been better if it had come sooner. I myself suggested a way forward in which both sides would withdraw their amendments so that more timely discussion might take place on an agreed draft regulation specific to this issue, which could be debated later in both Houses after proper consultation. I actually think that would have been a better and more orderly course in Whitehall terms, but that is not where we are.
The Earl of Lytton
My Lords, I will not detain the House for long. My interest as a practising chartered surveyor in matters to do with planning is well known. The concern about this area of the Bill is not to prevent development from taking place but to ensure that the community should have some input. There is a serious and objectively important issue here. It is that the density of development is a construct, particularly in urban and suburban areas, that needs constant review and monitoring. Filling up open space with development—perhaps “filling up” is a rather pejorative term, but noble Lords will get my drift—touches on and concerns that issue, and produces long-term, quantifiable effects on value, amenity and the general sense of space. That affects not only the public perception but individual neighbours. It is very easy for someone with a very short-term agenda who simply wishes to have further space for whatever reason to try to construct something that is less than worthy in the context of the locality. I pay tribute, as I have before, to the way in which local planning authorities have protected this construct, this facet, of our built environment. It is important that there should be oversight. Policies to protect amenity space, light and air should none the less still have house-room here.
There are a couple of issues that I hope the Minister will be able to clarify. Another qualitative consideration that risks being lost is to do with materials—things like colour, finish and texture. They risk being lost under the process of prior notification where the principle of development is enshrined in a permitted development context. I appreciate that design guidance in supplementary planning documents may overcome this if it is sufficiently up-to-date and all-encompassing, but it is not always.
It has been mentioned already that the local planning authority will receive no fee, whatever the length and breadth of its administrative role may be in dealing with something under a prior notification regime. I think that that is probably an injustice, other than in circumstances where, as the noble Lord, Lord True, and others have said, it is a straightforward in-and-out issue.
We have heard about the issue of too much planning and overconcentration. I believe that I made a comment earlier in the course of the Bill about the colour of people’s front doors or the design of their windows. We need to try to distinguish between removing the overconcentration on the particular and the wholesale removal of scrutiny, because the two are not the same.
Comment has been made on how the service of notice would work. That must wait for another day, but I would instinctively prefer 28 days rather than 21.
A further area, that has already been pointed out by the noble Lords, Lord McKenzie and Lord Shipley, is the question of definitions—back garden as opposed to side garden, curtilage as opposed to plot area, setting as opposed to something else—and the basis of identifying the proportion of the plot actually built upon if you want to get some sort of absolute measure. I remember a situation where I made an application for a tenant’s garage. It was turned down because, although it was in a rural road, the planning officer decided that it was offensive to the “streetscene”. Anyone walking up the “streetscene”, where they saw one house every half-mile, will realise what I mean when I say that I did not think that “streetscene” was a concept that applied to something that was stuck behind a hedge up above a high bank. This occurred because, needless to say, the building was not built with a frontage onto a highway, as you might normally expect, but was built end-on to the highway, so front and back gardens had a boundary with the highway. It is this sort of muddle that needs to be sorted out, because for every plot that is governed by the standard criteria of an urban street, there are other ones that are not so governed because they are corner plots or otherwise different and individual. We need to somehow disentangle that.
The noble Baroness, Lady Gardner of Parkes, asked what the sanction will be for not complying with a scheme as prior notified. Indeed, that is something that we need to be very careful about.
On the whole, though, I believe that the Minister and her honourable friend have gone some way to try to deal with this business through this halfway house of prior notification. Prior notification is not an unusual construct, despite what the RTPI may wish to say; it is commonplace in agricultural permitted development, so I do not have any particular worries with it as such. If the Minister is prepared to give some sort of undertaking that the detail of this will be subject to consultation, not least consultation via the processes through this House, then I will be inclined to take the side of the noble Lord, Lord True, and be prepared to draw a line under this—to take half a bun or two-thirds of a bun, even if it is not the whole bun that we wanted to start with.
Baroness Hanham
My Lords, I thank the noble Lords who have spoken, particularly my noble friend Lord True, for the tenor of this debate. I accept that there is not everything that everyone would want here, judging by the questions, but the House seems to accept that we have moved a long way since we started on the Bill.
I want to reiterate that the revised approach that we are taking responds in a targeted and direct way to the concerns that have been raised. As noble Lords have said, there are already existing permitted development rights that have operated effectively for a number of years. The change is that those permitted development rights are extended with regard to the size of buildings. This is not new, although I well understand the concerns that noble Lords have raised. Our revised approach will now ensure that under the new rights, in the case of larger extensions, any objection from immediate neighbours will be fully taken into account before permission is granted. I will come back to “immediate neighbours”.
Lord Cormack
My noble friend has not yet reached this point, but will this also include the time that will be taken to build the extension? The disruption factor is very real in people’s lives.
Baroness Hanham
The noble Lord has jumped in ahead of me: no. Planning permission currently has no timescale of how long it should take people to do a development once they start. Indeed, I am sure that many noble Lords have torn their hair out at something that seems to be going on for a very long time indeed. Of course, the district surveyor or building regulation enforcers might begin to get worried about why progress was not being made, but I do not think that we can expect to put details of that in legislation. That also goes for the question raised by my noble friend Lady Gardner about enforcement. There will be the normal enforcement procedures of local authorities, which they are able to implement when they have concerns that something is being or has been built outside what has been approved. The problems with enforcement are much the same with any planning development as with our new, light-touch proposals.
I hope that I have covered most of the points on which I wanted to pick up. The noble Lord, Lord McKenzie, in particular, gave us a very long list of things that he was concerned about. If I have not addressed something that anyone has a burning question about and they want to ask me quickly now, then I am happy to pick it up, but I think I have covered everything that time allows me to. I am grateful to all those who have spoken. I look forward to hearing, as I think that I have, that this has moved a long way, which has helped with this aspect of the Bill.
Lord McKenzie of Luton
My Lords, I start by thanking the Minister for dealing extensively with the queries that were raised and all other noble Lords who have spoken in this debate. There are two strands to it. Most noble Lords believe that sufficient progress has been made by the amendment to be able not to stick with the amendment of the noble Lord, Lord True, if that is where they originally were. The noble Lord, Lord Shipley, said that it had gone far enough to be supported. The noble Lord, Lord Deben, said that it was a huge improvement, even if it was not as radical as he would have wanted, based on the Quality of Life report. The noble Lord, Lord Cormack, was thankful for the movement. The noble Earl, Lord Lytton, believed that it had gone some way. The noble Lord, Lord True, himself, believed that there had been real progress. The other strand is how much still needs to be consulted on, and some of the details still need to be fleshed out, notwithstanding what we have heard today. The noble Lord, Lord Phillips of Sudbury, the “legal eagle”, said that there should be minimum room for discretion, effectively, because this generates a lot of angst among people.
The key issue seemed to be about the period. We heard 21 days but the noble Baroness, Lady Gardner, and several other noble Lords, did not believe that was sufficient. On fees, bearing in mind the state of local government finance, the lack of support from central government, given the imposition, is a real issue. I also believe there should be further discussion and movement on the limitation of these arrangements to the immediately adjoining properties.
As I hope I said at the start, we tabled our amendment because we had not seen what the Government were then proposing and wanted something against which to benchmark what did come forward. However, on the basis of what we have heard and this debate, I beg leave to withdraw the amendment.
Viscount Younger of Leckie
That this House do not insist on its Amendment 25, to which the Commons have disagreed for their Reason 25A.
The Parliamentary Under-Secretary of State, Department for Business, Innovation and Skills (Viscount Younger of Leckie)
My Lords, I am grateful for the full and wide-ranging debate that has taken place during our consideration of the Growth and Infrastructure Bill. Last week the other place disagreed with the amendment to remove the employee shareholder clause from this Bill. In today’s debate I will explain why the Government support the position of the other place to retain it in the Bill.
I intend to focus my initial remarks on the announcement made by my right honourable friend the Minister for Business and Enterprise who gave an important assurance about jobseeker’s allowance claims. I will also explain to the House why I believe it is important to support greater choice for companies and individuals with the creation of a new employment status.
Last week, my right honourable friend the Minister for Business and Enterprise announced in the other place that jobseeker’s allowance claimants will not be mandated to apply for employee shareholder jobs. This means that individuals receiving jobseeker’s allowance do not need to worry about their benefits being affected if they do not wish to apply for, or accept, an employee shareholder job. This is an important point. The Government will not compel jobseekers to apply for these jobs even if the job fits within their job search specification and we will leave it up to jobseekers themselves to choose whether to apply or not.
During the Third Reading debate on the Bill we discussed the guidance that will be made available for jobcentre staff to help them understand the new employment status. We have now updated the draft guidance for DWP jobcentre advisers. It now states explicitly that a jobseeker cannot be mandated to apply for an employee shareholder job. A copy of the draft guidance was placed in the Libraries of both Houses on 16 April.
We are debating a wholly voluntary new employment status. As I have said throughout the debates, we do not want people to be coerced into accepting these new contracts and it is worth us considering other protections that this clause provides. On Report in the other place the Government amended the clause to give strong protections for existing employees, enabling them to turn down an offer of an employee shareholder contract by their employer. First, we created a new unfair dismissal right that applies from day one of an employee’s contract. This means that if an employee turns down an offer to change their contract to an employee shareholder one and they are dismissed because they said no, this would be considered an unfair dismissal. Secondly, we created a new right not to be subjected to a detriment from day one of an employee’s contract. This means that if an employee turns down an offer to move to an employee shareholder contract and they then suffer a detriment, such as being passed over for promotion or for a pay rise for no good reason, they may be able to make a successful claim at an employment tribunal. These two protections allow employees to turn down an offer of an employee shareholder contract if it does not suit them and they can do this with the knowledge that the law protects their decision.
The clause has further protections. The shares, which must be worth at least £2,000 when given to the employee shareholder, must be fully paid up by the employer. This is an important point because if the company became insolvent and the shares were not fully paid up, the employee shareholder would otherwise be liable to pay any outstanding amount against the value of the share. It is important that we consider the context in which the new employment status fits. Employment law offers a choice of different employment contracts.
Lord Lea of Crondall
I am most grateful to the Minister for giving way at this stage. However, he has rattled through the circumstances in which someone could apply for a job: he says there is no compulsion and that there are options. I want to put a question absolutely clearly and directly. It arises from the guidance, which post-dates where we were last time in this House; in fact, it post-dates where the Commons were a week ago. The guidance refers to the circumstances where the vacancy is an “employee shareholder job vacancy”. Where, therefore, is the option for the jobseeker who does not want to be an employee shareholder? There is none. Is it not disingenuous to suggest that there is an option?
Viscount Younger of Leckie
I thank the noble Lord for his intervention. This currently remains an entirely voluntary procedure and jobseekers will not face a detriment if they are due to apply for a position.
Lord Lea of Crondall
I am sorry; it is very unusual to intervene twice. However, where is the option? The Minister has said that there is no coercion. Of course there is none in the sense of having a whip, but where is the option to get a job if it is solely an “employee shareholder job vacancy”?
Viscount Younger of Leckie
I am not sure I entirely understand where the noble Lord is coming from. If a jobseeker is seeking a job there are various options for him or her to look at in terms of roles, and the employee shareholder role will be treated equally alongside any other option. The only difference is that there will be absolutely no detriment to that individual if they apply for an employee shareholder role, and if they decide to turn it down. On the matter of guidance, I clarify that it remains in draft form. If this is an issue concerning the way that the guidance is written up, I am more than happy to listen to the noble Lord if he has any comments to make.
Lord Monks
My Lords, I am grateful to the Minister for giving way. Is he therefore confirming in that reply that it will be possible for an employer to advertise employee shareholder contracts only? Is that what the Minister is confirming?
Viscount Younger of Leckie
The answer is that if an employer wants to recruit an employee shareholder, he or she will decide how to advertise for that. They may decide not to advertise. They have a range of options which include advertising nationally. They may choose to send the advertisement into a jobcentre locally or to spread it nationally. That remains open just as it is if they want to recruit for any other position.
Lord Monks
My apologies for coming in again. What is voluntary about that for the jobseeker in those circumstances—the applicant for the job in an area of the country where there may not be many jobs and that is the only status available?
Viscount Younger of Leckie
It remains the case that an employee looking for a position can decide for himself or herself whether to accept an employee shareholder role. It is a separate status compared to other statuses. There is no difference in terms of them deciding themselves whether they want to accept or turn down that particular role.
Employers and individuals are free to agree to the type of contract that is suitable for the job. We are not moving away from this principle; rather, we are enhancing it by offering a further option which will be right for some, but as I have made clear in previous debates, not right for all. There are already three established employment statuses in the labour market, all of which have different rights associated with them. The employee status has wide-ranging rights, including unfair dismissal, statutory redundancy pay, TUPE, maternity leave and pay, and adoption leave and pay, to name a few. The worker status has none of these rights. However, both employees and workers have a right to the national minimum wage, paid annual leave, a right not to be discriminated against, and rest breaks.
There is a further option for people seeking work. They may wish to become self-employed. If someone chooses to be self-employed, they must accept that they have very limited employment rights, such as the right not to be discriminated against. This clause offers both employers and individuals a further option: employee shareholder. This is likely to be a long-term relationship. I would not expect anyone to enter into an employee shareholder contract without carefully considering the implications. This new employment status, with share ownership and favourable tax treatment, will provide small growing companies with a new option to attract high-calibre candidates.
Lord Myners
The Minister says that he does not expect employees to enter into such contracts without careful consideration, and he thinks that this will be a long-term commitment. However, the articles of association of most companies place restrictions on the sale of shares. Will the Government require that there be no restriction on the employee’s ability to sell their shares for the highest price they can achieve, as opposed to having to sell the shares back to the employer at whatever price the employer might justify as being fair in those circumstances? Otherwise I do not see how the employee can form a view on the value of the consideration that they are being offered in exchange for giving up valuable employment rights. Will the Minister give us a clear answer on that question? I feel that he did not offer an entirely clear answer to the previous question from my noble friend.
Viscount Younger of Leckie
The noble Lord makes a good point. The matter of what types of shares and what shares are offered is very much left to the employee and the employer. That is a negotiation between the employer and the employee. The Government will not prescribe how that will come about because there are different types of shares, as the noble Lord will know only too well from his experience. It will very much depend on the type of company, the wishes of the individual who may be looking at an employee shareholder role, and the employer.
Lord Forsyth of Drumlean
I am most grateful to my noble friend. When he says that the valuation and the convertibility of the shares will be a matter of negotiation between the employer and the employee, it is hard to see what the employee’s negotiating position would be. At the very least, should not the employee be given independent legal advice as to the valuation and the nature of the transaction he is entering into, which, after all, applies under existing employment law for compromise agreements and things of that kind? If it is to be a negotiation, surely the employee has to be informed, and not all employees will be particularly financially literate or employment experts.
Viscount Younger of Leckie
The matter of advice is very much applicable to settlement or compromise agreements, as my noble friend has pointed out. This concerns entering into an employment agreement, and therefore we do not see this as being appropriate. On the issue my noble friend has raised concerning share valuation, as he well knows, there are established means through actuaries whereby shares are valued. That is done all the time and it is a straightforward process. Again, that is very much a matter between the employer and the employee.
Lord Myners
I think the Minister has confirmed—but perhaps he could avoid any doubt about this—that it would be possible for the employer simply to say, “You can sell these shares only to me and only at the valuation that I judge appropriate, and without any reference to arbitration or a third party”. If that truthfully is the case, this policy is shambolic.
Viscount Younger of Leckie
I disagree entirely with the noble Lord because the employee shareholder will decide for himself. If he does not like the terms of the shares being offered, he does not have to enter into this particular agreement. It is wholly voluntary. He may be well advised to get some advice. He may decide himself to get some advice. That is not an issue.
Lord Adonis
My Lords, could the noble Viscount explain to us how jobseekers, who may have no resources whatever, will be able to get the advice that he has just told the House they would be well advised to get because of the very complex nature of the agreements and shareholding options into which they will be obliged to enter?
Viscount Younger of Leckie
Yes, I can answer that. However, the issues may not be that complex. It depends entirely on the agreement between the employer and the employee shareholder who is considering the new job. As the noble Lord well knows, a variety of sources such as lawyers and accountants can give this sort of advice to a prospective employee shareholder.
Lord Adonis
How do these jobseekers pay for this advice? Does the noble Viscount have a special fund which will be available to them? I know that plenty of people offer this advice but I am not aware that many of them offer it for free.
Viscount Younger of Leckie
To clarify what I said to my noble friend Lord Forsyth a minute ago, legal advice is clearly available for settlement agreements and compromise agreements. However, we have made it clear that it is not available at this time for those entering into a new employment contract.
Lord Deben
I wonder whether I can help my noble friend. When my companies give shares to our employees, not in return for anything but because they have worked for us for some time and we want them to be involved in the companies, we still find it difficult to explain the terms of those things, even though the terms, whatever they are, are a plus rather than a minus. I wonder whether it is right to suggest that this would not be a difficult thing for people to understand. That worries me considerably. I am very pleased that the Government have moved on the big thing for me, which concerned making it impossible to continue to have jobseeker’s allowance. That for me is a crucial matter. However, I wonder whether my noble friend does not underestimate the difficulty of explaining to somebody even the simplest of share options and share sales.
Viscount Younger of Leckie
I very much note my noble friend’s point. He has experience in this field. I say again that some negotiations may become complicated, but the employer and the employee shareholder will go into this with their eyes open. On the other hand, it may be a very straightforward and simple process. Indeed, the employee shareholder who is looking at this new role may decide that he is entirely comfortable with what he has seen, heard and, indeed, read. I clarify again that this is very much a matter between the employer and the employee shareholder.
Lord Myners
The Minister has just said that legal advice is available for settlement and compromise agreements but that it will not be available to an employee considering one of these contracts. Will he explain why legal advice would not be available? Will he then answer the question from my noble friend on the Front Bench on how a jobseeker seeking employment on the national minimum wage will be able to cope with the complexity of law and the articles of association and afford to take separate legal advice, which at a minimum would probably cost in the case of most lawyers the equivalent of close to a month’s wages on the national minimum wage?
Viscount Younger of Leckie
I can only reiterate that it entirely depends on the role on offer, the type of company and the type of employer as to how the discussions will go. An individual taking on a normal role, if I may put it that way—an employee role or a worker role—may find that sort of contract complicated, in which case they may have obtained their own advice and are still free to do so. This is a wholly different—
Lord Forsyth of Drumlean
I am most grateful to my noble friend for giving way and I shall try not to interrupt him again. However, can he explain to me why employment law as it stands requires employers entering into a compromise agreement to provide legal advice in order to make that agreement stand? They usually provide a reasonable amount of the cost of independent legal advice. If that is appropriate for a compromise agreement where people are surrendering certain of their rights, why should it not be appropriate where people are giving up their employment rights and entering into what may be a complicated and major financial decision, given the proposed levels of tax relief with capital gains relief of up to £50,000? What is the Government’s logic in saying that advice should be paid for by the employer in one case but not in this case?
Viscount Younger of Leckie
I know of many employee contracts—not those for an employee shareholder—where serious advice is required. However, the status of being an employee shareholder is wholly new. The individual concerned may well require advice but noble Lords are talking about the circumstances of entering the employment phase and the proposal we are discussing would set a new precedent. As we know, often very difficult discussions take place towards the end of the employment contract. That is where it has become the custom and practice for companies to pay fees. That is the difference. I hope that I may be allowed to move on.
The recruitment of skilled personnel is normally taken very seriously. It takes time and commitment and involves searching for suitable candidates, sifting applications and interviewing. This will be no different with the new employment status. In fact, companies will need to take time to consider whether this type of contract is right for them. The owner of a company offering the status should think about the impact of giving up equity in the company. This is a decision that is not easily reversed, as once you have given away your shares it may not be easy to get them back. We must remember that the owner is giving away a stake in the company. Companies will need to be sure that the person to whom they offer the contract is right for the company. An employee shareholder may be able to influence the decision-making of the company and take a share of the profits. This is not something a company would do without being sure that it was the right move for them.
The new status will not be applicable or suitable for all companies or all individuals but it might be right for some. This new employment status represents more choice for individuals and companies. I have been clear throughout our debates that the status is voluntary. Indeed, it may well be used only by a minority of companies, but what is important is that we allow them to choose what is right for their own personal and commercial circumstances.
Viscount Younger of Leckie
I hope that I may be allowed to finish. I urge the House to keep this innovative proposal as part of the Bill. We should not deprive individuals or companies of choice that may lead to more jobs and better company performance. Above all, it is good for growth in the UK. I beg to move.
Motion B1
Lord Pannick
As an amendment to Motion B, leave out from “House” to end and insert “do insist on its Amendment 25”
Lord Pannick
My Lords, on 20 March, your Lordships’ House voted by a majority of 54 to exclude Clause 27 from the Bill. The reasons of principle and practicality as to why your Lordships’ House so voted remain valid. They were not altered by the vote of the House of Commons last week. Indeed, the debate in the House of Commons, which was limited by a timetable Motion to 45 minutes, barely addressed, let alone answered, the concerns which were expressed on all sides of this House on Report.
I remind your Lordships why your Lordships’ House voted to exclude Clause 27. I want to do so because the noble Viscount’s speech conspicuously avoided, if I may respectfully say so, all the concerns which the House expressed on Report. I commiserate with him because he has been asked to defend the indefensible.
The first point is that Clause 27 frustrates the very purpose of employment rights. We can, and do, disagree around this House and in the other place as to what the content of employment rights should be. That is entirely proper. They are debated and amended from time to time as we see the balance between employer and employee and as we perceive the public interest. However, over the past 50 years all Conservative and Labour Governments have recognised that an employer and an employee cannot be allowed to contract out of those employment rights which Parliament has seen fit to guarantee. That is because it would defeat the very purpose of conferring those employment rights. They are conferred precisely because freedom of contract—a voluntary agreement, as the Minister describes it—does not protect the worker or the job applicant who lacks basic bargaining power. To allow basic employment rights to become a commodity to be traded in the way that Clause 27 proposes would frustrate their very purpose. We would not envisage for a moment allowing a manufacturer of goods to contract out of his, her or its obligation to the consumer simply because the latter chooses, voluntarily, to pay a lower purchase price.
The need for protection in the employment context is most obvious in the case of the person who is seeking employment. The Minister in the House of Commons, Mr Michael Fallon, emphasised last week that a Clause 27 agreement is voluntary. The Minister repeated that statement today but, as he accepts, the employer may under Clause 27 advertise the vacancy on the basis that it will be filled only on Clause 27 terms. In the real world, outside the House of Commons, a person who is offered employment on Clause 27 conditions only is not voluntarily accepting such conditions. In the current economic climate, he or she will have no practical choice. I welcome the fact that the Government have removed one aspect of the unfairness of Clause 27—that is that a person refusing work on Clause 27 terms would have lost jobseeker’s allowance; a quite extraordinary position—but the fact that the Government have removed the most outrageous aspect of this proposal does not mean that what remains is acceptable.
The first objection is that the clause proceeds on a theory of voluntary agreement that frustrates the very purpose of conferring employment rights and is wholly unrealistic. The second objection is the damage that this clause will cause. A number of noble Lords from the government Benches—I repeat, from the government Benches—made this point on Report and in Committee far more powerfully than I could hope to do. The noble Lords, Lord Forsyth of Drumlean and Lord King of Bridgwater, both of whom served as employment Ministers, the noble Baroness, Lady Wheatcroft, the noble Lord, Lord Deben—all of whom I am very pleased to see in their places—and other noble Lords on the government Benches explained, from their extensive business and political experience, just how damaging it would be to industrial harmony to allow employers to buy off basic employment rights, how no sensible employer would consider this to be beneficial and how Clause 27 would do enormous damage to the cause of promoting employee share ownership. I am very sorry indeed that the Government have chosen not only not to listen to this House but not to listen to the wisdom and experience on their own Benches. The Minister must know that there is not just a lack of enthusiasm for this measure on his own Benches, there is a positive hostility to it that makes the Government’s insistence on pursuing this cause and this clause, in the word used by the noble Lord, Lord Deben, in Committee, “mystifying”.
The third objection to Clause 27 is that even the case which was advanced by the Government in the House of Commons last week does not begin to justify the broad scope of the clause. The Government’s case, as expressed last week by Mr Fallon, is that Clause 27 will encourage new and small high-tech companies which will be more willing to employ people with special skills. Even if noble Lords were to accept that assumption—and it begs a large number of questions —it would justify only a specific and narrowly drawn statutory provision tailored to the specific circumstances which are said to justify its enactment. The generality of Clause 27 inevitably means that it will be used and it will inevitably be abused by the Gradgrinds of this world. This concern was expressed on Report by the noble Lord, Lord Forsyth of Drumlean, in his powerful speech against Clause 27.
Lord Forsyth of Drumlean
My Lords, I hesitate to follow the noble Lord, Lord Pannick, who has set out very clearly and persuasively the points that we discussed before and which are causing concern to the House. I share his concern about the Commons debate, which, as he indicated, was guillotined. All the serious points that were raised in this House have not really been addressed by my noble friend. I exonerate him from any blame in that respect but they are important points. Many of them may be slightly peripheral to the substance that we are discussing here, which is about employment rights, but, for example, I remain concerned as to whether the estimate made that this could result in more than £1 billion disappearing in tax-avoidance schemes is correct. It is not clear to me whether the Treasury has found ways of ring-fencing this scheme, which provides for up to £50,000 of capital gains tax to be relieved, and whether this could not be used as a great tax-avoidance scheme.
I got a call this afternoon from a Mr Mark Florman of the British Venture Capital Association, who wanted me to know that all his members were absolutely behind this scheme and very much supported it. I said to him, “Why are they concerned about a scheme that enables people to give up, in effect, only their rights against unfair dismissal if they have been employed for more than two years and can have £2,000 worth of shares, tax-free? What conceivable interest can that be to the membership of the British Venture Capital Association?”. He said that it was keen to encourage share ownership and for employees to be involved in share ownership. I am sure that people on all sides of this House are keen on that concept. That is why I would strongly support any schemes that encouraged share ownership. However, this proposal mixes up two things—one is employment rights and the other is share ownership. It is not at all clear to me how it would be beneficial to either employers or employees to embark on this scheme.
Being a reasonable, moderate sort of fellow, I looked at where we had got to in this debate, and I looked at the vote in the House of Commons, where the majority was actually somewhat less than the Government’s majority. I looked at the short-term nature of this matter and thought, “Is it possible to find a way of making this look not more sensible but more practical?”. It seemed to me that the Government could have done two things. One was, as the noble Lord, Lord Pannick, pointed out, to ensure that people who were embarking on an employee shareholder contract were given independent legal advice that the shares were worth what the employer was telling them, on what the arrangements in respect of the valuation of the shares would be at the end of the period, and on what employment rights they were giving up and the consequences of that. That seems to be an entirely reasonable suggestion. Regarding the idea that people on low incomes can go and get legal advice on these matters or that issuing and putting values on shares in private companies is straightforward, I have to say to my noble friend that the entire investment banking industry is based on the premise that the valuation of shares is not straightforward.
There is also the idea that by giving people shares in return for employment rights the employee is in a negotiating position. However, they want a job and are not in a position to say no. Even if the provision was that the employer may provide legal advice at the request of the employee, that would not be enough because the thought would be, “It’s going to cost the employer £1,000 and if I say I don’t need the advice, I might have a better chance of getting the job”. The fundamental point was made by the noble Lord, Lord Pannick: the reason that we have employment rights—while I think they go too far in some respects—is that they even up the position between the employer and the employee. I am not particularly persuaded on this.
However, I thank the Government for at least taking up one point, which is to alter the guidance in respect of the jobseeker’s allowance. I was grateful to my noble friend for the letter that he sent us, but I have to say that amending the guidance to say that people who refuse to take up this voluntary agreement would not be found to be intentionally refusing employment is not a concession; that was just a mistake by the Government that they have now corrected. It is not right to present this as a concession. The concession that is needed is to protect the position of the employee against the unscrupulous employer, and independent advice is part of that.
My other thought was that the Government say that this proposal will be of interest to small firms. Some people suggested to me that there could be an exemption stating that the measure would apply only to small firms. However, on reflection, I do not think that that is the issue at all. This is a general provision for employees, and whether it is a big firm or a small one is not the key issue here.
I am also worried that my noble friend said in his opening remarks that it will not be easy for employers to get the shares back, but in his own guidance he makes it clear that these schemes can include a provision that requires the employees to give the shares back. What is the deal here? It is: “You give up your right to be protected against unfair dismissal. We will give you some shares that we tell you are worth a certain value, but you have no idea whether or not we are right, and when you get those shares you have to pay tax and national insurance on them if their value is more than £2,000. Then at the end, I, as your employer, if I decide to sack you, can take them back at a valuation that may be less”. That does not seem to be a scheme that will set the nation alight with people wishing to participate in it.
I have to say to my noble friend that this thing is not thought through. Not only that, but to those of us who have tried to be constructive—I was prepared to go along with this today if the Government showed some sensitivity to the concerns that have been so elegantly expressed by the noble Lord, Lord Pannick, and others—the Government seem determined just to railroad this through and not deal with the arguments. I, as a Conservative, perhaps a Thatcherite Conservative, am not identified particularly with employment rights, but I am proud that it was a Conservative Government that first introduced them because we recognise that there has to be a fair balance in the labour market.
I therefore say to my noble friend, can he not think again and at least offer us a concession in respect of the right to have independent legal advice paid for by the employer whose initiative this is, so that the employee is in a position to know exactly what they are being asked to sign up to?
Lord Flight
My Lords, I cannot match the advocacy of either the noble Lord, Lord Forsyth, or the noble Lord, Lord Pannick, but I feel that there is a saddening negativity towards these proposals. I am glad that everyone agrees.
A lot of the issues raised in this House have been addressed—in particular, the concern, which I completely supported, that it would be a nonsense if people were forced to give up the ability to claim their jobseeker’s allowances if they turned down the offer of an employee shareholder job. That is the most important issue of the lot. But there are other important issues where the proposals have been improved. I see the situation in the context of a half-way house between self-employment and standard, typical, large-corporation employment.
An interesting survey has been published by the RSA which finds that more than 30% of people in their 20s now want to be entrepreneurs, self-employed individuals who will have no protection rights whatever. In terms of giving up rights, there are three important areas, including unfair dismissal rights—which are not given up as regards improper grounds such as discrimination—rights to statutory redundancy pay, and certain rights to request flexible working hours and time to train. People retain a whole lot of other employment rights and the issue is not, by a long chalk, about giving up all your employment rights.
Of the concessions that have come from the Commons, the most important is that the Secretary of State will have power to regulate the buy back of shares. That does not amount to legal advice, which would be nice, but it does afford a protection there. I suggest that, in practice, what will happen if any businesses embrace these schemes is that there will be the usual sort of standard formula. If there is a buy back by the company, then there will be a prescribed price earnings multiple, or such like, on which to value them. That will unfold as time passes.
Lord Forsyth of Drumlean
I am most grateful to my noble friend. I agree with his point about the tax allowance. If someone is awarded shares in the way that he has described and the value of the shares is, say, £20,000, will they then be liable to pay the tax and national insurance on that? Where will they find the money from?
Lord Flight
That is the very point that I made when we last debated the issue in this House. That is why I think the £2,000 limit is too low. The response to that is that it obviously depends on their tax rate. If people are accepting £10,000 worth of shares they may be able to find the tax which might be of the order of £2,000 to £2,500 on that award. It entirely depends. I also make the point that in more traditional entrepreneurial circumstances, which was my own experience, I had to put up the money myself and I had to remortgage my house to raise the money to start a business. I would like to see the limit raised, and I think for the scheme to work it will need to be raised, but we should not overstate the tax burden.
Lord Forsyth of Drumlean
I am most grateful to my noble friend. Does that not then mean that the value of the employment rights you are giving up depends on how much money you are able to find in order to buy the shares?
Lord Flight
First of all, it depends on what is on offer. It is broadly for the company to decide the amount of employee shares that it is going to offer under this scheme. To repeat the point, the employment rights which are being surrendered, particularly as viewed by ambitious entrepreneurial types, are not perceived as of particular value. The grant of free shares is of value and, to the extent there is a tax bill, I wish it were lower, but the tax bill is not entirely outrageous. I suspect that the tax limit will be raised in due course.
It is easy to be negative and to pick holes in what has not yet been fully addressed. I would like to see some of the improvements that noble Lords have suggested. But I think to take a rather superior view of, “Oh, no, we really don’t want this”, is wrong. I think it should be given a try and the issues that need sorting out will be sorted out. There are substantial numbers of ambitious young people for whom the objective is not to work for the Civil Service or to work for Shell or Unilever and to have a secure job with a generous pension, but to have equity in the businesses they work for, to make that business work and to make their equity worth a considerable amount of money.
Lord Monks
My Lords, unfortunately, I was unable to be present at Report stage, but I was struck when I read in Hansard that the House of Lords was doing its job like it perhaps does not do enough in an admirable and exemplary non-partisan way, looking at the practicalities of this proposal, not looking for negativity but simply giving it some forensic examination, which has clearly not been done by many in the Government and many who supported it in the other place.
This proposal about shares for rights is implausible. It is difficult to see too many people showing any significant interest in it. If we want to abolish red tape, well, just look at this proposal. It is full of red tape. I believe it is also objectionable—the idea that somehow you can sell your rights or trade in your rights. It is very clear which rights you will lose. It is a lot less clear, for all the reasons that have been stated, what employees will get and how those shares will be valued.
The proposal is also perverse. In the Report stage debate the noble Baroness, Lady Wheatcroft, set out one example. If matters do come to redundancy, will the employer decide to get rid of those with shares who have given up their redundancy pay or those to whom the employer will have to pay redundancy pay? It could well be the employee shareholder who is first out of the door.
The advice that the House of Lords gave to the Government has been treated with contempt. It has just been brushed aside. That includes the advice given by distinguished former Conservative Employment Ministers who are loyal on nearly all occasions, but not on this one. That is not being negative. That is not looking for negativity. It was good advice that was given, it is good advice that is being given now and I hope that this time, if the vote goes the right way from the point of view of those of us who are critics, it will be listened to with a little more concern and consideration than it got last time.
The noble Lords, Lord Pannick and Lord Forsyth, have ably pointed out the fallacies and flaws in the proposal and I will not repeat those. However, I do not think that many employers will give it much of a second look unless there is some tax advantage which will no doubt come to light in due course. Some unscrupulous employers will do so and that is where the individual worker would need some source of independent advice about what they agree to and what they do not.
I find the position of the Business Secretary in this matter intriguing. He fought a battle against the Beecroft proposals, but let us remember—I am no fan of the Beecroft proposals—that he did not propose taking away rights to compensation for redundancy. He was talking about a single payment. It seems to me very strange and disappointing that the Liberal Democrats and the Business Secretary have let this clause slither through the processes of government in the interests no doubt of a deal with the Chancellor of the Exchequer. I hope for the Liberal Democrats’ sake that it is a good deal which compensates for their disgraceful agreement on this matter. I hope they will think again in the time that we have available and put this clause where it really belongs, which I believe is in the nearest recycling bin.
Baroness Warnock
My Lords, noble Lords may be somewhat surprised that I speak on this issue, but it so happens that I have spent a great deal of the past few months looking into employee shareholding and employee ownership and have had long discussions with Charlie Mayfield, who, as noble Lords know, is chairman of the John Lewis Partnership. He was consulted about this proposal and simply regarded it as laughable.
What kind of firms did the Government really have in mind when they invented this farrago—it seems to me—of nonsense? I believe that they had in mind the smallish high-tech firms that set up outside Cambridge, Oxford, Bristol and so on. They thought that all the people employed by this kind of firm were going to be high-tech experts and graduates of their local universities and that the company would be inventive and innovative and, when it got bigger, would probably sell itself off, having made a profit. I do not think, when this was invented, that the Government had in mind that large companies would really have any interest. In fact, I remember that on Report the Minister was reduced to saying, “Well, the good thing about this is that not very many people will take it up”. That seemed to be an extraordinary argument in favour of it. Does the Minister really think that this will be an option open universally to businesses, including retail and manufacturing ones, or is he still thinking, as I am sure the Government were at first, of these very small businesses where everyone starts off more or less equal—equally well educated, intelligent and able to get legal advice—and is anyway probably in it for the interest of the thing and its short-term life? Can the Minister answer that question?
Lord Deben
My Lords, the noble Lord, Lord Pannick, very kindly reminded the House of my words at an earlier stage, in which I used the expression “mystification”. My concern is that I start from rather a different position. I think that a kind of package could be put together that would represent that midway point between someone who was self-employed and someone who was fully employed, particularly in dealing with the kind of company that the noble Baroness, Lady Warnock, has just pointed to; indeed, I thought that was the intention. I am dismayed because I do not want to remove the possibility of a sensible experiment that would enable small firms, in return for shares, to recognise that, to use a phrase, “We are all in it together”. That seems perfectly respectable.
I could not go along with what was being proposed, as a matter of principle, until the change that has now taken place. I thought it unacceptable that someone should lose their jobseeker’s allowance because they had not entered into what ought, right from the beginning, to be a different kind of arrangement, which would have to be voluntary. I do not agree with the noble Lord, Lord Pannick, that, because the job would be advertised in this way, somehow or other it was not voluntary. There are lots of jobs that people decide they are not going to take because of the terms under which they are presented. I do not find that objectionable.
What I find so difficult with the Government’s proposition is that it seems that it will not work. Frankly, it does not matter much what we decide on this because I do not think anyone is going to take it up and I do not think it is going to happen. That makes me sad—not for the reasons of the noble Lord, Lord Monks, but because I actually think that there is a place for a system that would enable a partial involvement in the beginning of a small company, which would of course mean that you took some cognisance of the fact that it was a pretty rocky position and in return you got some sort of special advance. However, at every turn, we find that it does not quite work like that. All along the line, the sort of things that we might have liked do not seem to work out—not least, as my noble friend Lord Flight described, when it comes to the problem of how you pay for things and how you organise that. You begin to realise that this does not have the enlivening, enlightening and opening effect that the creators of this idea obviously thought it would have. I am not driven to the extremes of feeling that this is ghastly and awful thing, because I just do not think it is going to be taken up.
Lord Woolf
I apologise for interrupting and thank the noble Lord for giving way. However, does not everything he has just said, which I have listened to with great care, indicate that this is one of those situations where legal or financial advice from somebody competent is critical?
Lord Deben
The noble and learned Lord, Lord Woolf, puts me in the most difficult of positions. I have spent my whole life congratulating myself on being the only politician from Cambridge of my time who was not a lawyer, and therefore complimenting lawyers, or suggesting the need for legal advice, goes against the grain in a big way—but I have to say that he is right. However, that is not the only thing. The issue is how we make this a creative contribution to the development of small businesses rather than something that has become an argument not about that at all but about giving up employment rights, the need for legal advice and all those things. We did not start from the basis that we ought to have, which is what puts me into this huge position. I apologise therefore for not being enormously supportive. I still have to listen very carefully to decide quite how unsupportive I am going to be, but I say to my noble friend that I wish we could have turned this good idea into a good idea instead of turning this good idea into what seems to me to be largely not an idea at all.
Baroness Turner of Camden
My Lords, there are already in existence what I suppose you could call partnership schemes, where people can of course have shares and a partnership with a company without the necessity for the abandonment of employment rights. As this legislation stands at the moment, one cannot help feeling that this is a way in which the Government want to get rid of employment rights without appearing to do so by introducing a scheme under which the employee can be persuaded to voluntarily give up an employment right where they normally would not consider doing so because that would not be required.
I do not think that we can judge this on the basis that “We ought to have a scheme where people do participate”. Schemes like that are available. What is difficult about this is that the basis seems to be the abandonment of employment rights before the employee can get involved in any sort of share or partnership scheme. I think that that is what we object to very strongly; I, at least, have done so from the very beginning. It has always seemed to me that the Government themselves are not keen on employment rights. This is a way of getting rid of those rights without appearing to do so, simply by offering an employee something that really does not compensate for the loss of the very important employment rights that we have been discussing today. It is that sort of basis which is why I oppose this clause and why I fully support what the noble Lord, Lord Pannick, has said with great clarity. This is the situation that I take now, and I hope that the Government will be disposed to accept what we have said on this side of the House—indeed, on every side of the House—which is: do not proceed with this scheme. Not only will it not work, but it is not right and it does no good at all to employment and employment rights.
Baroness Brinton
My Lords, I want to start by thanking the Government for the concession on jobseeker’s allowance candidates and the fact that they will be not penalised, but I have to also agree with other colleagues on both sides of the House who have admitted that this is really the rectification of a mistake rather than a major concession. However, it is essential. It is critical because before it, any of the guidance to the DWP and Jobcentre Plus offices would have been unusable and unworkable for this system, and would have put candidates for such jobs at complete peril.
I am also pleased—I will not go into detail about this, but want to refer to it—that throughout the passage of this Bill we have consistently talked about the necessity of independent legal advice. That is not just for those who are currently unemployed and are being sent to interviews by Jobcentre Plus; it actually applies to anyone. I think of a young 23 year-old that I know who has just joined a high-tech company in Cambridge where I think hardly any of the employees do not have at least one degree and most have at least two. However, if you asked that 23 year-old about the way shares work, he would not understand them at all and would clearly need advice as well. Helpfully, the firm that he has joined has made sure that any new employee who gets access to the share scheme gets that advice, so there are some good examples around.
However, if this scheme does not offer that advice where there is an element of two tiers of employment, that means that such advice must be made available. Frankly, I agree with the noble Lord, Lord Pannick, and others who say that it is on a par with the formal legal advice required for compromise agreements.
Following the debate in the Commons last week, I shall focus on the Minister’s referral yet again to this being suitable for small high-tech companies, particularly in university areas and high-tech areas. Confession time: in the 1980s I was a venture capitalist, spinning ideas mainly out of universities, although not only Cambridge University, and that is one of the reasons why I have quite a lot of experience and knowledge of what is happening in those companies now.
It is quite clear that good, small high-tech companies already use employment share schemes, or share schemes for all their employees who come in right at the start. The reason why they do this is that they know it is going to be a very hard road to make the product successful, particularly if it has not even been developed yet. They know that as time goes on further rounds of money will be coming into the company, and that they will be diluted not just once or twice but to a very minimal amount. Therefore, £2,000-worth of shares on day one, which for argument’s sake might represent 10% of a brand new company, might actually end up being a tiny percentage once you have had three, four, or five rounds of venture capital and hedge fund money going in. As a result, an employee will have to wait a very long time before they see any benefit.
Again, having to pay for those shares up front is not just an issue for those who come from unemployment; it is an issue for those coming in at a very low starting salary who, in addition, have to give up their employment rights and are being told, quite frankly—in Cambridge, which I know quite well, everyone freely admits this—that it is extremely unlikely that you will see any return on any investment in the first 10 years of a high-tech company. If you do, then it is a real star and is to be applauded. However, the vast majority, 95% of firms, do not do that, and 90-plus% of the firms do not actually provide a return to shareholders because they are often sold at the point at which the shares are virtually worthless. So please can we stop deluding ourselves that small high-tech companies are perfectly suited to this? The good ones do it already, but why on earth would they then want to give up employment rights in return for an extra part of this very risky journey? It just does not add up.
I was slightly concerned when the Minister referred to self-employment for these sorts of firms. I understood from the chart that we have received with the Minister’s letter, for which I thank him, that they are outside employment law, and I think that the House would accept that. The references being made implied that self-employment might be an option for those working for the firm, and I think that would definitely be against HMRC guidance; if somebody is working principally for a firm then they should not be self-employed. I am concerned that we are perhaps beginning to develop a dialogue of a third tier of employment, and I hope that the Minister will be able to make it absolutely clear that self-employment is only for those who actually have a range of clients and customers and do not work for just one firm.
The noble Lord, Lord Deben, talked about how this might be a point for experimentation, but I think the experiment is already happening and has been happening through the examples that I have been giving, without the need to give up employment rights. In summary, I believe that this legislation is unloved, unnecessary, unwanted and, frankly, likely to be unused. I am concerned that this is not the best use of Parliament’s time. I am in the same position as the noble Lord, Lord Deben; I do not like voting against my own Government, but I just feel that there are too many flaws in this. It is not a hopeful scheme for the future; they are there working at the moment. Please, let us not compromise employment rights in return for shares that are very unlikely, for the vast majority of employees, to be worth anything at all.
Lord Forsyth of Drumlean
Before the noble Baroness sits down, I wonder if she could help us with the question that the noble Lord, Lord Monks asked: what exactly is the nature of the deal that has meant that the Liberals have taken a position that is well beyond Beecroft and which they were previously opposed to?
Lord Bilimoria
My Lords, when I first heard about this scheme, my initial reaction was to give the Government the benefit of the doubt because it encourages share ownership and enterprise—all good intentions. However, I have listened to the arguments of the noble Lords, Lord Pannick and Lord Forsyth of Drumlean, and to the noble Lord, Lord Deben, who has great relations with his coalition partners, summing it up by saying, “It won’t work”. The noble Baroness, Lady Brinton, has said the same.
I cannot understand this. I have started businesses and run businesses at different levels and I have given shares to my employees, so all this about £2,000-worth of shares—even the figure itself is baffling. Who on earth is going to go through all this for something as incentivising as £2,000-worth of a share incentive, although I know that that is a minimum figure, and then to have to get legal advice? Do people understand the practicalities of offering legal advice if every time someone applies for a job they have to get legal advice to go for the share scheme? Then the question was asked: what if these jobs are offered and the Government say that they are voluntary only? If a job is offered as an employee share job only, though, that is not voluntary. As an employee you either take that job on those terms or you do not. I think that the Government have the best of intentions, and they say that there will be no compulsion, but I cannot see this being taken up.
What research did the Government do before they came up with this scheme? We have heard from the noble Lord, Lord Forsyth, that Mark Florman says his members think that this is a great scheme. Did the Government check with Mark Florman before they proposed this scheme? Now the noble Baroness, Lady Warnock, tells us that Charlie Mayfield, who I respect greatly as one of the most successful chief executives in this country, running the John Lewis Partnership, says that this is laughable. That is the reaction of serious business to this.
Lord King of Bridgwater
My Lords, I think I am not the only Member on this side of the House who feels some embarrassment at finding ourselves in this situation. As has been said, particularly by the noble Lords, Lord Pannick and Lord Monks, this House passed a pretty categorical vote to suggest the omission of Clause 27. It included, among others, a previous Chancellor of the Exchequer—his name has not been mentioned here but he voted against it—and a former Cabinet Secretary. It was not the usual suspects causing trouble in the back reaches of the parliamentary process.
I thought that there was not much new to be said but I credit the noble Lord, Lord Bilimoria, for bringing a few additional points into this debate that I think are very relevant. I join in the recognition of what has been described, rightly, as a correction of a previous mistake; none the less, the Government have corrected the position over the jobseeker’s allowance. However, some of us were waiting to see the Government’s serious response to the very major criticisms that were made a month ago on Report. This House’s duty of revising, amending and inviting the other place to think again was carried out, and the Government were given time to consider how best to respond.
My good friend Mr Michael Fallon, who had the responsibility of introducing this determination to disagree with the Lords in their amendment, said that it really was entrepreneurs on one side and employment lawyers on the other—not just the noble Lord, Lord Bilimoria, but a few others of us have had some small involvement in industry, employment and entrepreneurial activity over the years. I was interested that the noble Lord, Lord Forsyth, referred to the director of the British Venture Capital Association. I was the director of a leading venture capital investment trust for a number of years and I do not think that a single person I knew in that industry would support it or think that it might be a good idea.
I understand entirely why the noble Lord, Lord Flight, made the comments that he did because they bore out and illustrated the point made by the noble Baroness, Lady Warnock: who is this really intended for? The noble Lord, Lord Flight, will recognise that he has a background in and vast experience of a world where people do not think first when they go into employment, “What are my rights?”. They are thinking, “What are the opportunities for me here to really earn a substantial reward?”—as we know, a number of them earn very substantial rewards indeed. I have to say to him that it is quite difficult to stand up, in the ping of a ping-pong, when we are meant to have finished our revision and amendments, and say there are a number of things that now need to be sorted out. That is not acceptable.
I disagree with one point made by the noble Lord, Lord Pannick, that this will do great damage to industrial relations. I do not think it will at all, on the grounds that the noble Lord, Lord Deben, mentioned. I do not think that a single major company will touch it and it seems absolutely inconceivable that you could try to introduce this status into any major company. If some of your employees are entitled to redundancy pay and some are not, and then you get a downturn in trade and you are determining who should be kept, and if one of those people who does not get redundancy pay then gets dismissed and is told that he does not have a claim for unfair dismissal—as I understand it; like my noble friend, I am not a lawyer—he would immediately have a claim under discrimination. The idea that you ease the employer’s burden and prevent it being drawn into the courts is of course not so.
I certainly support the Government’s ambition to see what we can do to reduce unnecessary and undue burdens on employers, which certainly on occasions prevent the growth of employment. There is no higher objective at the present time, in our very difficult economic situation in the world when jobs everywhere are in very short supply, than doing everything we possibly can to encourage employment. However, that does not mean that we must lose our good sense and go for a scheme that someone has dreamt up if we see that at the end of the day problems will arise.
I had hoped that we would see some new approach to the issue. If the Government are absolutely committed to this idea and trying out this new approach to employment and the creation of jobs, it seems without question that people will be asked to address questions that would test quite sophisticated advisers in this field—the noble Baroness, Lady Brinton, was absolutely right about small start-up companies full of incredibly clever young men and women who have particular technical or other skills but no financial experience. Has my noble friend got nothing to say about whether independent advice, which would be paid for by the employer, should be available to people who find themselves in that situation? If the Government are not prepared to move in that direction, I will find it impossible to support their position.
Baroness Wheatcroft
My Lords, my noble friend Lord King mentioned a degree of embarrassment at finding himself in this situation, which I certainly share. At least those of us who are opposed to this legislation are not alone. The Financial Times, that great bastion of employee rights, ran a leader the day after the last debate in this House in which it said that this legislation contained,
“little to like and a lot to fear”,
and it advised strongly against progressing with it, saying that if this clause went ahead,
“employee share ownership may begin to be perceived as a shortcut to strip workers of their rights”.
That is not what any of us in this House want to see. We know that employee share ownership is a good thing. We want to support the Government in everything they can do to spread it, but this clause is not the way. The number of ways in which this clause could backfire has been enumerated this afternoon. Not much attention has been paid to the potential tax avoidance involved. It has been mentioned, but the Office for Budget Responsibility itself put a label of around £1 billion on the costs that might be in there. Is that really what the Government want to see happen? How is that compatible with the current agenda of trying to cut back, quite rightly, on tax avoidance?
It is the way in which this clause could detrimentally affect the idea of share ownership that causes me the biggest problem. It might not be big companies that will use it, and it is a very strange defence of a piece of legislation to say that hardly anybody is going to use it. I have heard that rather often and it seems an odd way to go about government business. There will be unscrupulous companies below the FTSE 250 that see this as a way of getting the labour force that they want on the least good terms. That is not going to encourage good employee relations. We want to do what my noble friend Lord Deben referred to and encourage the feeling that we are all in this together. If we are to go for growth, getting that sort of motivation will be important. Depriving people of basic rights is not the way to do that.
There is a potential exception for start-ups, where everybody starts off in the same boat and you do not risk this idea of a two-tier scheme of employees. Small companies probably need a bit more flexibility. They already have two years in which they do not need to worry about tribunals or redundancy, but they might need a little longer than that. In that case, perhaps we might ask my noble friend the Minister once more to see whether he can persuade the other place and the Government that this clause should be very narrowly restricted in its implications and application. As a clause that creates something open to any business it is potentially very dangerous.
We have also heard about the problems of valuing the shares. In his valiant attempt to defend this proposal, my noble friend Lord Flight said that we might well reach a stage where the Government have to stipulate the price-earnings ratio on which these shares would be sold. This is not the role that I wish to see my Government undertake. It is fraught with problems. This entire clause needs another rethink, even at this late stage.
Lord Adonis
My Lords, the noble Viscount has been a Minister for a short time only, but I think I speak for the whole House in recommending that he be promoted to an earldom for services to masochism. We have now debated this proposal for twice as long as the House of Commons saw fit to devote to it last week. In the hours of debate in this House, there has been one Member only, besides the Minister, who has wholeheartedly supported this proposal, and we pay great tribute to him: the noble Lord, Lord Flight. Even he sounded a note of equivocation today, saying that he hoped that the many problems that there were still with the scheme could be “ironed out” while it was being implemented. This is not good advice to legislators on how we should conduct our business.
However, I am grateful to, or perhaps sorry for, the noble Lord, Lord Flight—because it weakened his case—that he did not repeat the argument that he used last time, which was that we did not need worry about the £1 billion of potentially lost tax revenue, to which the noble Baroness referred. He said:
“The Treasury will therefore not lose tax revenue as a result of the tax arrangements; it will merely not get as much as it might otherwise get”.—[Official Report, 20/3/13; col. 622.]
I am sure that is hugely reassuring to HMRC and to those of us who are loyal taxpayers and who do not need to worry about the fact that there is no money to pay for anything, because it is simply revenue that the Treasury might otherwise not have got.
Viscount Younger of Leckie
I thank noble Lords for their contributions to this debate. I reiterate that the Government would like to give individuals and companies more choice in how they discuss and agree employment contracts. The employee shareholder status provides this additional choice. I will start by addressing the issue raised by the noble Baroness, Lady Warnock, about who the policy is aimed at. She asked, in effect, whether anybody would want this employment status, and who would want to employ an employee shareholder. These themes were raised also by my noble friends Lord Forsyth and Lady Brinton.
I clarify again that we understand that the new employment status will not be appropriate for all companies and will not be taken up across the board. It will simply add to the options and flexibility available to companies and individuals in determining their employment relationships in the same way that workers or employees, part-time or permanent staff, are not suitable for all companies. We expect that the new status will probably appeal mainly to fast-growing, small, start-up companies and individuals, as this is the level where employment rights are seen to impact the most. We have never said that the take-up will be widespread. We have always said that it would apply to a small number of companies, should they wish to take it up.
My noble friend Lady Brinton again raised the issue of who this might apply to. She cited the Cambridge example. She is quite right that companies that are likely to take this up are those that are new. They are likely to be making products that they want to be successful in the long term. She is right to say that this can be an extremely long road. However, she is taking a particularly negative view of the opportunity for employee shareholders. If I heard her correctly, she said that employee shareholders would have to pay for the shares up front. That is not the case. They will be given the shares, which will be free, even though, clearly, they will have to pay tax on them.
My noble friend Lord Forsyth raised the issue of tax, and the cost of the new status. The Office for Budget Responsibility has stated that in the long term the policy may cost up to £1 billion, but that relates to periods beyond the 2020s. It is simply not possible to be certain about costs so far in the future. The noble Lord, Lord Adonis, also raised this issue. Moreover, the tax rules will contain protections to prevent abuse—again, this issue was raised by several noble Lords—such as serial use of the scheme, and rules to ensure that those who have a material interest in the company and who thereafter can influence decision-making will not be eligible for the tax advantages. The Government will keep the rules on tax under review. I hope that provides a measure of reassurance.
The noble Lord, Lord Monks, who is in his place, raised the issue of Beecroft. This familiar story was raised in Committee and on Report. A number of noble Lords suggested that this was Beecroft by the back door. It is not. The new employee shareholder status is different from the no-fault dismissal proposal. Individuals will become shareholders of the company at the start of the employment relationship. This is an important benefit conferred by employee shareholder status. Unlike in the case of no-fault dismissal, the employee shareholder status will be agreed between employers and individuals in contractual negotiations. Employers will also be free to offer improved contractual terms such as contractual redundancy payments in an employee shareholder contract.
The noble Lord, Lord Myners, raised the issue of share buyback. He asked whether in effect a company could force an employee shareholder to sell back their shares. A company may require an individual to sell back their shares as a condition of the shares. However, this type of restriction will affect the value of the shares, which the company must assess when granting the shares and attaching restrictions. This comes back to what I said earlier about negotiations needing to take place in advance of the contract being signed by both the employee shareholder and the employer.
The noble Lord, Lord Pannick, raised the issue of independent advice, as did a number of other noble Lords, including my noble friend Lady Brinton. We do not require a person who is moving from employee status to worker status to be given legal advice before becoming a worker. Therefore, it is not clear why we should require legal advice to be given when an individual moves from employee to employee shareholder status—a status that carries far more employment rights than that of the worker. Companies are not required to provide independent financial advice to people who are thinking of becoming employees or workers, and employee shareholder jobs are just like worker and employee jobs.
The Government will provide guidance on gov.uk about the new status in the same way that they provide guidance about employee and worker employment statuses. Using this information will help individuals to determine whether the employee shareholder status is right for them. I say again to my noble friend Lord Forsyth that the situation of individuals taking up employment with employee shareholder status is distinctly different from the often challenging and difficult discussions that can take place, and sometimes need to take place, to determine settlement agreements at the end of an employment.
The noble Lord, Lord Myners, raised the issue of general advice on complex articles of association. Our guidance will make clear to both employers and employees the sorts of issues to consider before making a decision. The guidance, as I mentioned earlier, is in draft form and we continue to welcome views to improve it.
Lord Forsyth of Drumlean
On this point of the valuation of shares, could my noble friend deal with the point that was made by the noble Lord, Lord Bilimoria, about liquidity? It is all very well to reach a theoretical value of shares, but the value is actually in what people are prepared to pay for them. In small private companies where there is no liquidity, how will you deal with that?
Viscount Younger of Leckie
It remains the case that these are discussions that must take place between the employer and the employee. Again, it is not for the Government to prescribe or give advice in this respect. That is a consistent theme that I have taken.
On the same theme of shares, as raised by my noble friend Lord Forsyth, we recognise that there may not be a market for private company shares and therefore it is important that, where appropriate, a buyback clause will be useful to both the employee and the employer. This is an issue that the noble Lord, Lord Myners, raised as well. We introduced in the other place a power to bring forward the regulations that would govern these buyback clauses in the event that employers were behaving unscrupulously. This would prevent employee shareholders being forced to sell back their shares at an unnaturally low price.
The noble Baroness, Lady Turner of Camden, made an assertion, or perhaps it was an accusation, that the Government want to remove employment status. I reiterate what I mentioned both in Committee and on Report, that this is not about removing rights, it is about creating a new employment status that offers a different set of rights and a mandatory share ownership. The status, I say again, is not compulsory for companies to use, and it will only be suitable for those companies that want to share ownership with their workforce. We must remember that employee shareholders will retain the majority of employment rights, including, for example, automatic unfair dismissal rights and the right to be paid the national minimum wage. We have consistently said that the new status will not suit all people or all companies. This is very much a common theme. However, for those who choose to use it, the employee shareholder status offers more flexibility and allows greater risk- and reward-sharing between people and companies.
My noble friend Lady Wheatcroft and others raised the issue of whether the employee shareholder scheme is open to tax avoidance, an issue that I touched on slightly earlier. It is a key aspect of the policy to allow employee shareholders to share in the success of their employers without paying capital gains tax on at least some of their gains. However, to guard against abuse of the tax exemption, there are several rules that limit the number of shares that can be exempt. For example, the rules will prevent repeated consecutive use or multiple simultaneous use of employee shareholder status to get around the limit. In addition, anybody who controls, alone or with other connected persons, 25% or more of the voting power in the company, will not be able to receive exempt shares. We will not allow people such as spouses or children who are connected to individuals who control 25% or more of the company to benefit from the exemption.
We have listened to the concerns and, as was mentioned earlier, we have acted to ensure that jobseeker’s allowance claimants will not be penalised if they decide not to apply for or accept an employee shareholder job. Together with protections for employees, our announcement about jobseeker’s allowance policy means that no claimant or employee can be forced to accept this status. I thank many noble Lords for their support in this particular respect.
The new employment status gives ambitious, talented individuals with entrepreneurial spirit an opportunity to share in the risks and rewards of being part of their employing company. I want to say something important in these closing stages. I have clearly listened this afternoon and I have heard the strength of feeling in the House towards this particular clause. I ask the House to support the Motion to agree with the Commons’ position that Clause 27 be retained. If the House does not support that Motion, I will ensure that the strength of feeling in the House today is conveyed to my ministerial colleagues.
Lord King of Bridgwater
Can the Minister confirm that the Government have not felt able to move towards a clause on the issue of availability of independent advice?
Viscount Younger of Leckie
That is correct. I did not make any movement in that direction. I reiterate again to my noble friend that I am not immune to the strength of feeling in the House this afternoon. I have clearly listened and I will be conveying all comments back to the other place and to my ministerial colleagues.
Lord Pannick
My Lords, I am grateful to the noble Lord for the skill and courtesy with which he has presented the Government’s case. I am also very grateful to him for his frank acknowledgment of the strength of feeling on all sides of the House in relation to Clause 27. Of course he will appreciate that only if this House stands by its previous decision and asks the Commons to think again will the Government and the Commons do so.
Your Lordships can rarely have heard a debate in which so many noble Lords with business experience and political experience on all sides of the House have carefully and eloquently explained why a Government proposal is either wrong in principle, or damaging in practice, or unworkable, or misses its target, or unbalanced, or all of the above. Noble Lords clearly have a variety of reasons for criticising Clause 27. It is striking indeed that no speaker this afternoon apart from the Minister was supportive of Clause 27 in its current form. Even the noble Lord, Lord Flight, who complained of what he described as “negativity”, said that the clause could not work if the shares were worth only £2,000 at the date of issue and accepted that other problems needed to be addressed.
The noble Lord, Lord Deben, asked rhetorically for advice on what the noble Lord should do, given his belief that a positive proposal in this context could be brought forward. It is not for me to advise the noble Lord, Lord Deben, but if I were doing so I would suggest to him and to other noble Lords who may be in the same position that the answer is clearly to reject the half-baked scheme currently before the House in the hope that the Government take this idea back to the drawing board—or perhaps, to use the expression of the noble Lord, Lord Forsyth, on Report, back to the bath in which he suggested that this idea was dreamt up—so that they can reconsider whether in this Bill, or in some future Bill, a more thoughtful and workable scheme could be brought forward.
The concern about Clause 27 is not politically partisan. The noble Lord, Lord King of Bridgwater, and the noble Baroness, Lady Wheatcroft, referred to a measure of embarrassment in their position. They should not be embarrassed. It is to the great credit of their Benches that so many noble Lords have spoken out and voted in favour of deleting Clause 27 or abstained on Report. I of course appreciate that it is not easy to do so, but it is in no one’s interest for this proposal to be enacted in its current form.
The Government and the House of Commons have so far given the most cursory consideration to the concerns expressed on all sides of this House. They should be asked to think again. I wish to test the opinion of the House.
Enterprise and Regulatory Reform Bill
(11 years ago)
Lords ChamberRead Full debate Read Hansard Text Read Debate Ministerial Extracts
20:23 - Division on Motion A1 - Ayes: 210 / Noes: 180 - Motion A1 agreed.
22:11 - Division on Motion C1 - Ayes: 181 / Noes: 168 - Motion C1 agreed.
23:08 - Division on Motion agreed. - Ayes: 112 / Noes: 170 - Motion D1 disagreed.
Commons disagreement and reason
The Commons disagree to Lords Amendment No. 35 for the following Reason—
Baroness Stowell of Beeston
That this House do not insist on its Amendment 35, to which the Commons have disagreed for their Reason 35A.
Baroness Stowell of Beeston
My Lords, in moving Motion A I will speak also to Motion B. We are now discussing the provisions in the Enterprise and Regulatory Reform Bill, which seek to reform the remit of the Equality and Human Rights Commission. I will turn in a moment to the specifics of the Motion and the amendments before us. First, let me remind the House why we are discussing the EHRC, or what we often more commonly refer to as the commission, Britain’s designated equality body and “A-rated” national human rights institution.
In May last year, we set out our plans to support the commission to become the valued and respected national institution that we all want it to be. Even the commission’s many supporters in this House have acknowledged that the first few years of its existence were anything but trouble free. I am not going to go into the detail of these problems again today, but I do want to be clear that the Government’s motive in making changes was and is to secure a successful future for the commission so it is in the strongest position possible to do its vital work.
We are already making progress. In the past three months alone we have agreed with the commission a new governance framework document and budget, both of which ensure that the commission is able properly to fulfil its important duties and protect its operational independence. The new chair, the noble Baroness, Lady O’Neill, and other members of the new board have now been in post for several months and are building on the work of their predecessors. We believe that the commission is going from strength to strength. Indeed, the working relationship between this Government and the commission is marked by a mutual respect and clear understanding of the distinct roles that each is there to fulfil and how we can work together towards a fairer society. I believe that this will be evident when we come to the next debate on caste discrimination.
Having given that introduction, let me move to the Motions in front of us. In the ERR Bill, the Government originally put forward two legislative changes that we believe will underpin the positive changes which our non-legislative reforms have already helped to bring about. This House rejected the Government’s amendments on Report, but the other place has disagreed.
First, we are asking noble Lords not to insist on their Amendment 35, which would remove from the Bill the repeal of Section 3 of the Equality Act 2006, what is otherwise known as the commission’s general duty. Section 3 imposes a general duty on the commission to perform its functions with a view to “encouraging and supporting the development” of a fairer society and it sets out five ways in which it should do this. As I have made clear during all of our debates, the statement included in that general duty is one we can all support because we all want a fairer and more equal society. However, it is this Government’s view that making this a statutory duty for the Equality and Human Rights Commission, in addition to its specific responsibilities to promote and to protect equality, diversity and human rights, dilutes the clarity of purpose necessary for it to be effective and successful.
The Government are clear that the commission’s core purpose is what I have just said—to promote and protect equality, diversity and human rights. That purpose is underpinned by the detailed duties contained in Sections 8 and 9 of the Equality Act 2006. The repeal of the general duty does nothing to affect the commission’s ability to fulfil these duties. It is our view that its focus on them will enhance its performance.
Baroness Campbell of Surbiton
As an amendment to Motion A, leave out from “House” to end and insert “do insist on its Amendment 35”.
Baroness Campbell of Surbiton
My Lords, it is with great sorrow that I find myself here at ping pong, seeking to reinstate Section 3 of the Equality Act 2006. I really do not do this lightly. I know that a challenge to the Government at this stage should be made only when it is absolutely necessary and all other routes have been exhausted. I had hoped that the Government would listen to the many and exceptionally well considered arguments made by all but two noble Lords on Report. I expected something more than a blanket no. That is why, having explained my reasons to the Minister last week, I have retabled the amendments that were overturned in the other place.
We have yet to hear of a single example of how the commission’s capacity to act as the guardian of equality and human rights in Britain will be improved by repealing the general duty in Section 3, a duty which gives a holistic direction to the commission based on principles of dignity, respect and fairness, and takes it to, but not beyond, legal enforcement in helping society change for the better. The Equality and Human Rights Commission itself has said that it now has sufficient focus and, in the absence of robust reasons for removing it, Section 3 should remain.
I ask your Lordships to recall where the duty came from and to consider where its repeal may take us in the future. Twenty years ago today, Stephen Lawrence was murdered by a group of young men for no reason other than the colour of his skin. The Metropolitan Police made a catalogue of errors in the investigation into his murder. Our criminal justice system failed Stephen Lawrence, and it failed his family in their quest for justice. It is a sad truth that it took this tragedy to create a moment of enlightenment. The inquiry, led by Sir William Macpherson, identified that racial discrimination could not be seen as the lone action of a few bad apples. It was part of the institutional culture of the Metropolitan Police.
That insight led to the sea-change in our approach to equality law and the structural support to promote and enforce it. The general duty embodies this shift in thinking. The role of the commission is not simply to seek compensation for those who experience discrimination. As Age UK has noted, it is to pursue cultural change to prevent such discrimination from occurring in the first place. This is not only about racial discrimination. It is about institutional discrimination and violations of human rights in all their guises and across society—for example, in parts of the NHS and our care system, as the EHRC demonstrated in its inquiry into older people’s treatment at home. It is also widespread in the criminal justice system and local authority practice, as the disability hate crime inquiry revealed. It is rife in the exploitation of migrant workers, exposed by the inquiry into the meat processing industry.
Ministers have argued that the general duty is symbolic and aspirational, as if this were enough to dismiss it out of hand. The general duty symbolises our commitment to preventing the kind of injustice faced by the Lawrence family, or the routine abuse of disabled young people in institutions because of indifference and cruelty. It aspires to a society founded on dignity, respect and equality—notoriously absent in these cases. However, contrary to what Ministers claim, the general duty is not, in fact, merely symbolic. Its repeal could have major implications for the commission’s role in monitoring equality and human rights. In the other place last week, the Minister told MPs:
“We are also changing the commission’s monitoring duty to ensure that it reports on its core functions, rather than on the state of society generally”.—[Official Report, Commons, 16/4/13; col. 217.]
At present the commission is required to monitor Britain’s progress towards the aims of the general duty. In so doing it holds up a mirror to society, as it did in its seminal report, How fair is Britain?. As the Minister indicated, if the general duty is repealed, the monitoring duty will be fundamentally changed—it will be limited to holding up a mirror to itself and asking only, “How effective is the commission?”. This is why Amendment 35 relating to Section 3 and Amendment 36 relating to Section 12 of the Equality Act 2006 are inseparable and must be considered as one.
The Minister went on to say that changing the monitoring duty,
“will also enable the EHRC to gain the respect hon. Members want it to have as our equality body and national human rights institution”.—[Official Report, 16/4/13; Commons, col. 217.]
This suggests a dangerous misunderstanding by the Government of the requirements of European Union law and the United Nations standards on the status and mandate of national human rights institutions. The likely effect of these proposals would be to prevent the commission, and therefore the UK, from complying with the requirement for equality and human rights bodies independently to monitor the national situation.
This could have very serious consequences. In the light of the Government’s package of reforms the international accreditation committee for national human rights institutions has announced that it will re-examine the commission’s status next month. I do not need to spell out to my noble friends the impact on the UK’s moral authority abroad if, as a direct consequence of these reforms, the commission were to lose its present A-accredited status. Such a development would no doubt be seized on by countries such as Zimbabwe and Iran. At a time when the UK is seeking a seat on the Human Rights Council that is not a risk we should be taking. I am sure noble Lords would agree that we must practise what we preach and lead by example.
The commission’s role as an agent of change matters to millions of people in this country, whether they are an elderly person in hospital, a woman fleeing a violent partner or a black teenager and his friend waiting for a bus. In a civilised society such as ours people in these vulnerable situations should feel confident that our institutions will accord them dignified and fair treatment as equal citizens. Justice is poorly served if our commitment to equality and human rights extends only to offering compensation after an event. For many, it is simply too late.
Today, of all days, we should remember why we put these measures in place and not be so foolish as to believe that it could never happen again. That is why, for the second time, I feel we must send these urgent messages to the other place that the general duty and the duty to monitor its aims must be taken very seriously and must stay. I beg to move.
Lord Low of Dalston
My Lords, I was sorry not to be here for Report stage of the Bill but I have read the debate carefully. It left no room for doubt as to the strength of support right across your Lordships’ House for retaining Section 3. In addition to the powerful and principled advocacy of the noble Baroness, Lady Campbell, and others, I attach particular importance to the comprehensive demolition of the Government’s case in legal terms by my noble and learned friend Lord Lloyd of Berwick.
Your Lordships will be pleased to hear that I do not propose to go over again all the substantive arguments again, which have been so comprehensively crawled over in Committee and on Report, about the value of duties that cannot be enforced in a court, for example, whether there is a place for the declaratory in legislation, the value of a unifying link between equality and other fundamental human rights—I was rather surprised that the Minister sought to deny that one in her wind-up—the fact that there is nothing in Section 3 that suggests or implies that the commission is to be solely or uniquely responsible for encouraging and supporting the goal of an equal society, the negative message sent by removing the general duty and so on. I think that these arguments have been comprehensively won.
Baroness Thornton
My Lords, I will make some very short remarks because the noble Baroness, Lady Campbell, and the noble Lord, Lord Low, have more than adequately explained why we find ourselves in this rather unfortunate position—I agree with the noble Baroness, Lady Campbell—of asking the Government to look again and asking another place to take this back.
It is important also to say that one thing has changed since we discussed this in Committee and on Report. That is that the EHRC has given this matter some further reflection. I congratulate the noble Baroness, Lady O’Neill, because it is a sign of the maturity of the organisation that it has changed its view on this matter at least a small amount. I will read out a statement that was issued, and that is about the only thing I will say. The statement about the repeal of Section 3 on its website says:
“However, the debate in the Lords and commentary by parties have underlined the importance which is attached to the general duty. Many people clearly believe that, both in terms of the perceived mission and role of the Commission, and the coherence of the legislation, it is valuable to retain the general duty. Unless the government can provide additional robust reasons for removing the general duty in the current situation, our analysis suggests the case for removing the Lords’ amendment in the Commons has not been made. The Commission therefore continues to support retention of the general duty and maintaining the position established by the Lords”.
We know from the previous debates and from listening very carefully to what the Ministers in this place and in the other place have said that there is actually no robust case for the repeal of the general duty. Your Lordships’ House took that view by a majority of over 50 when this was discussed on Report. I put it to your Lordships’ House that the one thing that has changed is in favour of the retention of the general duty, and I hope that the Minister will now weigh this issue in the balance and agree to leave Section 3 in place. Indeed, if the Government wish to review Section 3 or any other part of the equalities legislation then that should be done with prior consultation and the involvement of the Joint Committee on Human Rights. We on these Benches do not believe that that is desirable or necessary, but if it were to be done it should be done in a proper way, not as part of a Bill that addresses regulatory burdens on business and enterprise.
Lord Lloyd of Berwick
My Lords, the Minister has not advanced this evening any of the arguments that she advanced at the beginning of January for repealing Section 3 of the 2006 Act. I will therefore leave those arguments on one side.
Instead I will turn to the arguments advanced by the Minister in the other place. He asserted boldly that Section 3 of the 2006 Act should be repealed because it was not a core purpose of that Act. With great respect, that is exactly what it was. Section 3 was in a sense the core purpose of the 2006 Act, that purpose being to bring together for the first time in legislation equality rights with other fundamental human rights. The specific duties under Sections 8 and 9 were to be the means of bringing about that core purpose. That was the very point made by Professor Sir Bob Hepple in his report. He said that Section 3 is important because it states for the first time what he called the “unifying principle”. It is most unfortunate that the Minister in the other place, when he came to his reply, did not reply to that argument or to any of the arguments advanced in the other place; sound arguments and convincing arguments, they were all, unfortunately, left aside because there was no time to deal with them.
There is a hint, elsewhere in what the Minister said, that Section 3 is undesirable because it would, as it were, take the commission’s eye off the ball to the exclusion of the important duties under Sections 8 and 9. There was never much danger of that. In any event, the commission has now made it clear, if I am right, that it would now welcome the retention of Section 3. If that be so, surely we should leave it at that.
It is not often on these occasions that we should resist the view of the House of Commons at this stage of ping-pong. However, the Government have not given one single solid reason why we should repeal a provision that both Houses were in agreement on as recently as 2006. As I have said, the Minister did not deal with any of these arguments in his reply. We should give him another opportunity of doing so, and another opportunity to the other place to see if they agree with those arguments or not. For that reason, I will vote for the amendment in the name of the noble Baroness, Lady Campbell.
Baroness Hussein-Ece
My Lords, I pay tribute to the work and the steely determination of the noble Baroness, Lady Campbell. She has been inspirational in her continuing support for what she believes to be an important principle and issue. Many of us share her passion and determination.
It is very poignant that today we are again debating the general duty of the Equality and Human Rights Commission and its principle on the 20th anniversary of the terrible racist murder of 18 year-old Stephen Lawrence, and on the day of the memorial service that was held this afternoon in his memory, which I understand was attended by the Prime Minister and others.
Last month at an event to launch a book about the Macpherson inquiry, Doreen Lawrence said that, as a mother, for 20 years she had not been able to grieve and find closure because she had been forced to fight for justice, year after year. There are still individuals out there today who were involved in this murder and who have not been brought to justice. She wrote to the Prime Minister last November asking that he does not row back or seek to water down hard fought equalities legislation that all political parties came together to put on the statute book so recently to protect those who need protecting.
Huge progress has been made over many decades, particularly since, for example, my own family came to the United Kingdom, when racism and discrimination was rife. However, there is still much to do to ensure that our society becomes more equal, and that we maintain and build on such positive work, particularly since the Macpherson inquiry and its findings. It is irrefutable that more than a decade later, the Macpherson inquiry can rightly claim to have led to an overhaul of Britain's race relations legislation which created much stronger anti-discrimination powers that can be found anywhere in western Europe. Attitudes towards racism and policing have now changed as a result. However, there are still very many people and communities who need to be protected and encouraged to achieve their potential and not be limited by prejudice or discrimination. We need the commission to have the tools, the ability and the duty to monitor the progress in our society.
Lord Cormack
My Lords, whether it is a runner wearing a black ribbon in a marathon or a coffin draped in the Union flag, there is a real and proper place for symbolism. If this is all that we are debating, why on earth are we removing this particular symbol? In our last debate at Report, I abstained, feeling slightly guilty, I have to admit. One reason I abstained was that the commission had not come out with a clear, unequivocal statement such as has been quoted by the noble Baroness from the opposition Front Bench this evening. If the commission believes that having this symbolic duty does not retard its work or its progress, and if it believes that it is a declaration—and there is room for the declaratory as well as the symbolic—and that this is helpful to its work, with all the respect that I have for the noble Baroness, Lady O’Neill, and all the belief that I have in her capacity and competence, I can think only that she and her colleagues can be helped.
I wish we had no need for such a commission; I am sure we all wish that. It is one body that we would like to see work itself out of a job. Unfortunately, society as it is means that there is a need. If there is a need, there is a need to define. If there is a need to define, there is a need to say, in broad and simple terms, what the commission should be for and what it should be doing.
I admire greatly the noble Baroness, Lady Campbell. We know it is not easy for her to address this House. She does so with courage and most articulately. The case that she made this evening and that was so ably backed by the noble Lord, Lord Low of Dalston—we are pleased to see him back from his recent operation—was frankly an unanswerable case. I have to say to my noble friend who will respond to this debate: why? What is the point? What is the purpose? There are occasions when a Government have to fight for something that may be unpopular. I have gone into the Lobbies supporting Governments fighting for things that have been unpopular for over 40 years. Nevertheless, this is asked for by those bodies with which the commission has regular dealings. It is not going to add to the sum from the public purse. It is not going to obstruct the commission in the specific duties which it has to follow. So what is the point and what is the purpose of doing this?
In following up a point made by the noble Lord, Lord Low of Dalston, I have also to say that the other place, of which I was proud to be a Member for 40 years, has not exactly examined this matter with critical care and scrutiny. It has given it a quick turnover and sent it back. Well, at the end of the day, the view of the Commons, as the elected House, prevails; that is my constitutional view. However, I think we have to say to it again, “Look, you have got this wrong. Including this section is not going to impede the Government in their work. It is not going to do any damage to your economic strategy. It is not going to do any damage to your social strategy. What it is going to do is to give the commission what it believes to be helpful and necessary on what those bodies which deal with the commission believe the commission should have”.
I did abstain last time; I shall not abstain tonight. I hope that we can send a clear signal to the other place that it should back down, come off it and do something sensible.
Baroness Stowell of Beeston
My Lords, I am grateful for all contributions to this debate, and I mean that quite sincerely. As I respond, I am very conscious of the strength of opinion that has been expressed in your Lordships’ House this evening.
I will start by responding to a point raised by the noble Baroness, Lady Campbell of Surbiton, in response to my remark about us all wanting the commission to be as effective as it can be so that it is respected by everyone. I want to clarify what I mean by that because I think there are two separate issues here. One concerns the ICC’s status, or the commission’s A status being conferred on it by the ICC, and any suggestion that that is at risk. I reassure the House that the Government have had ongoing discussions with the ICC. I know that the chairman of the commission—the noble Baroness, Lady O’Neill—is continuing her dialogue with the ICC. The non-legislative changes that we have made around the budget and the framework document all strengthen the situation with regard to its status. I do not think that that is at risk. In talking about respect, I was trying to get at a slightly different point in that I want the Equality and Human Rights Commission to be respected not just by those of us who automatically take very seriously equality and human rights but also by those who do not. In order for us to create the kind of society that we are talking about in this context, we need the commission to be supported by everyone.
That takes me to another point that the noble Baroness, Lady Campbell, raised, and was echoed by my noble friend Lady Hussein-Ece, on the origins of Section 3 and the general duty. Today marks 20 years since the tragic murder of Stephen Lawrence. I cannot express to the House how much respect I have for Doreen Lawrence, who had to suffer the murder of her son for progress to be made in this country on some equality issues. That is beyond words. I pay tribute to everything that she has achieved and wish that she had not had to suffer in the way that she did in order to achieve what she has. However, I say with the greatest respect to the noble Baroness, Lady Campbell, and others who referred to the death of Stephen Lawrence in the context of the general duty, that that tragedy resulted in the introduction of the public sector equality duties in the Equality Act 2010. That terrible event did not result specifically in Section 3 and it is important to be clear on that point.
The noble Baroness, Lady Campbell, referred to reporting and monitoring. It is clear that the general duty then becomes a practical issue because the Act states that the commission is required to monitor that general duty and report on it. The noble Baroness suggested that by changing the monitoring requirements the commission would no longer be able to hold up a mirror to society and would be able only to hold up a mirror to itself in terms of what was happening when it produced its reports. I absolutely disagree with that. In my opening remarks, I made it clear that the new monitoring requirements would allow the commission to continue to hold up a mirror to society. It is our view that the new monitoring requirements will lead to a much more focused report, which we hope will have greater value for Parliament and other bodies that may want to refer to it.
The noble Lord, Lord Low, asked whether, in the absence of Section 3, the commission might be more open to judicial review as regards its work under Sections 8 and 9. The commission has never raised this concern in its briefings on the duty. We have no reason to think that the detailed and clear duties in Sections 8 and 9 would be made any more vulnerable by the removal of the general duty.
The noble and learned Lord, Lord Lloyd of Berwick, mentioned the advice given by Sir Bob Hepple and the Government’s response to his view. I say two things to the noble and learned Lord. First, at earlier stages of the Bill, we heard from the noble Lord, Lord Lester, a contrary view to that expressed by Sir Bob Hepple about the role of Section 3. Further, in our view, there is no indication that Section 3 has any interpretative value in relation to any other legislation, including the Equality Act 2010 and the Human Rights Act 1998.
The noble Baroness, Lady Thornton, and others pointed to the commission’s recent briefing and its statement that it supports maintaining the position established by the Lords for retaining its general duty. In response, I acknowledge that that is what the commission has said publicly and I understand and respect that view. However, in the same briefing paper it has also made it clear that removing the general duty would not affect the commission’s ability to do its work. On those matters, it is worth making it clear again that by removing the general duty we are not preventing the commission doing any of its very important and good work. It will not lose any of its vital powers of promoting equality, tackling discrimination and promoting human rights. As I have already said, when it comes to monitoring, producing quinquennial reviews in future should lead to it providing something more analytical and of greater value to those who want to use it as reference.
As I said when I first stood up, I am very aware of the strength of views expressed around this House. This is an issue where the noble Baroness, Lady Campbell, supported by all those who spoke tonight, feels differently from the Government. I have tried to set out again why the Government feel that this change will lead to a stronger Equality and Human Rights Commission, which is what we really want. When we come on to the next discussion about caste discrimination I will be able to reflect how important the role of the Equality and Human Rights Commission is. I ask your Lordships to agree with the Commons in their disagreement of the Lords amendment and the noble Baroness to withdraw her Motion
Baroness Campbell of Surbiton
My Lords, I would like to thank the Minister for her reply and to thank noble Lords who have contributed to this debate, the last debate, the one before it and the one before that. I have never worked so hard to protect a piece of legislation which the majority of people want and about which so many noble Lords from all sides of the House have spoken in favour. I find it quite incredible that something so symbolic and so important to the proper functioning of the Equality and Human Rights Commission has been such hard work.
I do understand that there has been improved mutual respect between the Government and the commission and the quality of the work has been enhanced. That is to be celebrated, but I still believe it is critical to retain the general duty and the monitoring duty for all the reasons that we have given in these debates since last year. I would like to thank the noble Lord, Lord Low, and the noble and learned Lord, Lord Lloyd, for helping me tonight to expand the arguments for the general duty. It would be wrong to rehearse them again now: we have exhausted them. I was particularly pleased to hear the noble Lord, Lord Cormack, express his passion and his very clear understanding of why the general duty is necessary to the work of the Equality and Human Rights Commission and also to the messages that we send out to the Lawrence family, to disabled people who are undergoing considerable difficulties in situations where, without a culture change, they will continue to be abused in institutions, and to others that we have mentioned throughout these debates. For them, I ask your Lordships to agree with my amendment tonight and to send it back to the Commons saying, “Please consider these arguments”, because they were only looked at in a very cursory way during the Commons debate. In fact, I believe the debate suffered a guillotine in the winding-up speech only three minutes after the Minister stood up. I ask the House to send this amendment back so that a proper debate can be had and the arguments examined properly. I ask your Lordships to agree to this Motion. I wish to test the opinion of the House.
Commons disagreement and reason
The Commons disagree to Lords Amendment No. 36 for the following Reason—
Baroness Stowell of Beeston
That this House do not insist on its Amendment 36, to which the Commons have disagreed for their Reason 36A.
Motion B1
Baroness Campbell of Surbiton
As an amendment to Motion B, leave out from “House” to end and insert “do insist on its Amendment 36”.
“Equality Act 2010: caste discrimination
(1) The Equality Act 2010 is amended as follows.
(2) After section 9(1)(c) (race) insert—
“(d) caste;”.”
37A: Because it is inappropriate to provide for caste to be an aspect of race for the purposes of the Equality Act 2010 without further consultation.
Baroness Stowell of Beeston
That this House do not insist on its Amendment 37, to which the Commons have disagreed for their Reason 37A.
Baroness Stowell of Beeston
My Lords, we come now to the issue of caste and whether it should be made an aspect of race and thus a protected characteristic under equality law.
The whole House agrees that prejudice and discrimination based on caste is wrong. It is unfair and unacceptable in a modern society and is certainly unacceptable in Britain. There is no place for it and we need to take the right action to ensure that there is no place for it. It was your Lordships’ view when we last debated this that caste should be directly and immediately included in the Equality Act as an aspect of race. The other place has taken a different view and said we should not legislate at all without further consultation. There has, as yet, never been a full public consultation on this issue.
I will be absolutely clear. The Government have listened to what your Lordships’ House has said. We acknowledge the widespread support among noble Lords for legislation and the strength of opinion that has already been expressed. Today, I will explain the additional steps the Government are taking in response to the strength of that opinion. Since we last debated this matter, significant concerns have also been expressed about the implications of legislation. These concerns have not come only from those we would expect to be against legislation. Her Majesty’s Opposition also raised legitimate and serious questions during the debate in the other place. As I said during our earlier debates, this Government are not against legislation as a way of tackling caste discrimination. However, we do not have all the information that we believe is necessary to decide that the power in the Equality Act 2010 should be exercised. We think a responsible Government should consider all relevant issues and the implications of legislation before going down that route.
During our previous debate, my noble and learned friend Lord Mackay of Clashfern suggested that having the provision for caste in the Equality Act had given the courts reason, which they might not otherwise have had, to doubt whether the existing legislation protects people against caste discrimination. This helps to illustrate a very important point. We must ensure that whatever we do next does not create new, unintended consequences which could make it harder for people to seek redress. However, at the same time, we must of course be conscious of the need to bring what we do next to a conclusion as quickly as possible.
If we are able, shortly, to reassure ourselves on these points and decide, after consultation, to exercise the power that already exists in the Equality Act, then an advantage of this power is that we can do so via secondary legislation. In other words, I want to reassure your Lordships that there need not be a requirement for new primary legislation and therefore any unnecessary delay. I should note, however, that the amendment brought before the House today would not permit any meaningful public consultation or allow any flexibility through secondary legislation in the way that the Opposition, among others, have been arguing. Caste would simply join colour, nationality and ethnic origin as an aspect of race in the Act, and that would be that.
In a moment I will explain what additional information and steps we think are necessary before the Government will decide, and what the timescale is for that decision. First, I shall summarise some of the concerns that have been raised. First, there are concerns about whether we are actually legislating on the right ground. Some organisations have suggested that descent is more appropriate than caste, and this is an issue that the Opposition have also raised in debates in the other place. I am aware that there are differing and strong views on the question of descent, which we cannot go into today. However, the fact that there is genuine uncertainty over the definition of what we are legislating about clearly suggests that we should not be adding further to the law before carrying out the sort of consultative process proposed by both the Government and the Opposition, although I acknowledge that the Opposition have a different proposal in terms of consultation.
There are also concerns about individuals having to indicate their caste in any monitoring. The NIESR report is clear that some people would not want to do this or indeed admit to caste existing at all. We all have to consider what business would need to do to comply sensibly with such a provision and, if so, what costs this would entail. Would there need to be a code of practice, and if so, would it be reliable in such sensitive matters? To take one important stakeholder in this area, the CBI has stated that,
“on this terribly complex issue time must be taken in order to craft the right intervention, rather than rushing the process in order to comply with the timetable of the ERR Bill”.
At the moment, I believe it is not clear that we have all the information that we need on these and other questions. A significant number of Hindu and Sikh organisations, including some representing people from the perceived lower castes, have expressed concerns that they have not had a chance to provide considered views and would be strongly opposed to immediate legislation on this. For example, the GAKM UK which represents the Mochi community, which is deemed one of the lower castes, believes that by enacting the clause in law, the Government could undo all the work done by our communities over the past 20 years to try to remove the differentiation by caste in all aspects of life.
I am, of course, aware that some noble Lords may say that this is the sort of argument that could have been used to delay the advent of race or indeed of any other discrimination law. However, there is a fundamental difference with caste in that not only do we wish to get rid of caste prejudice from British society, we actually see no useful value in caste itself, or of anyone defining themselves by their caste. In that sense it is not like colour or ethnic origin, or any of the other protected characteristics. We need to ensure that the action we take, particularly if in legislation, sets us towards this aim and not in the opposite direction of embedding caste as a concept in domestic law.
As your Lordships will be aware, on 1 March this year, the Government announced a programme of educational work within the affected communities. At that time we also said that the Equality and Human Rights Commission will investigate the right way of tackling the problem of caste prejudice and discrimination, using the evidence in the NIESR report and earlier material from ACDA and other groups as its starting point. In last week’s debate in the other House, the Minister for Women and Equality announced that in parallel with this work a public consultation will be undertaken on the use of the caste power in the Equality Act. As I have already stated, a full, balanced public discussion is something that has not previously happened, and we think it is crucial that it now does so.
Lord Avebury
My Lords, I, too, welcome the forthright statement by the Minister that caste discrimination is unacceptable, unfair and must be eliminated. However, I disagree with the diagnosis that she offered, which involves a delay at least until the end of the year before anything positive is done. I think that your Lordships will agree with the noble and right reverend Lord, Lord Harries of Pentregarth, that, having spent three years since the Equality Act waiting for the Government to declare their intentions on Section 9(5)(a), which they could have invoked at any time during that period, it is now time for your Lordships to make a decision on how we deal with this matter in law.
The basis of the argument about this proposal has shifted radically since your Lordships agreed to give the Government the power to extend by order the protected characteristic of race to include caste. At that time, the Government were not satisfied that discrimination on the grounds of caste existed in employment, education or the delivery of services. Now, three years later, from the Prime Minister downwards the Government accept that people in the United Kingdom do suffer discrimination on the grounds of caste, and that action needs to be taken against it.
They believe, however, that, unlike with discrimination on the grounds of any of the protected characteristics that are already dealt with in the Equality Act—age, disability, gender reassignment, marriage and civil partnership, pregnancy and maternity, race, religion or belief, sex and sexual orientation—caste is unique in being susceptible to treatment merely by education and conciliation. This is clearly a vain hope, as we see from the history of racial discrimination. The noble and right reverend Lord, Lord Harries, mentioned the repeated efforts of Fenner Brockway in the 1950s and 1960s, which, as I remember very well, fell on stony ground. Before the 1976 Act, introduced by my late friend Lord Jenkins of Hillhead, provided legal remedies for victims of racial discrimination in employment, education and the delivery of services, the Race Relations Board provided education and conciliation but those remedies were ineffective.
The Government say that there is no consensus for this amendment. I remember that the Conservative Opposition in the Commons, led by Mr Quintin Hogg as he then was, were against the 1968 Race Relations Bill on the grounds that it was unfair to private employers. As your Lordships know, many employers today would like to be able to discriminate on grounds of sexual orientation. There is no consensus there, but it did not stop us from legislating.
There is a consensus in favour of legislation among all the organisations in this country that represent the Dalits and other groups that are on the receiving end of caste discrimination, as we saw from the BBC “Newsnight” programme last week. Those bodies that have expressed concern draw their members from the higher castes. I challenge the Minister to produce a single Dalit who belongs to any of them.
Lord Parekh
My Lords, I oppose the amendment not because I disagree with its principle or disapprove of it, but because I believe that it is trying to go about achieving it in the wrong way.
The basic premise is that there is still a small amount of the practice of untouchability in Indian society in Britain and that it must be countered. I agree entirely. However, by using caste as a general category, you are going to catch too much at one end and too little at the other. The fact that there is untouchability is not only corroborated by some of the reports that have recently come out, but I myself discovered it in 1986 when I was deputy chair of the Commission for Racial Equality. I received a letter, sent from Birmingham, written by an Indian gentleman who said that his doctor had refused to examine him physically when he came to his home because he was an untouchable. In those days we used to have domiciliary visits, which sadly have stopped now. We wrote to the doctor and it turned out to be true. The doctor was reprimanded and I would like to hope that the practice had stopped. Of course, it does not stop just like that but a warning had gone out to the medical fraternity. This was in 1985 or 1986, and even after that there have been many cases of untouchability and therefore discrimination does occur. It needs to stop.
However, untouchability is only the egregious, extreme form of the caste system, because the system covers everybody. Although caste does not mean anything to me personally, you cannot be a Hindu without belonging to a particular caste, full stop. Talking about abolishing the caste system is extremely problematic because it could mean getting rid of the category, getting rid of the hierarchy among the categories or getting rid of the principle of heredity which determines the caste. Where do you start? I suggest that caste as a category of discrimination is therefore not in the same league as race, religion or any of the other protected categories. If we were to introduce this, there would be four major difficulties and I want to alert the House to them.
First, there will be frivolous complaints based on caste. I do not know how many of your Lordships are students of sociology or have Indian friends. However, let us say that I belong to a caste—whatever that may mean, since I have married outside my caste and my children have married outside their caste, race and religion. Nevertheless, technically I was born in the caste of goldsmiths because my father used to make gold and silver ornaments, so I am a goldsmith. Supposing that someone were to apply for a job in the university where I am a professor who happens to be a blacksmith, a shoe smith, a Brahmin or God knows what, and I do not appoint him because he is not terribly good. Supposing that he were go to the court and say, because I would be doing this not as a Lord but as a Professor, “Professor Parekh refused to appoint me on the grounds that I belong to a different caste”. We would belong to different castes, although he is not an untouchable. Since every Indian who is Hindu carries the caste mark with him, every action that he does with respect to another can be subsumed under one or another form of caste discrimination, so the first difficulty is that you will have an enormous range of frivolous complaints with no way of arguing for or against.
Secondly, once you take away the untouchability bit, there is no evidence of any kind to show that caste discrimination takes place. With respect to the untouchables, they do not have horns or carry any distinct mark of being untouchables. Sometimes, their surnames are a giveaway if you know Indian society but a large number of them—I have worked with them and I greatly admire them—have changed their surname so that it is not a giveaway. When somebody applies for a job, how would you therefore recognise that he is an ex-untouchable? That would be the second problem.
The third difficulty that one would have is that, as the Minister rightly said, we will be introducing the category of caste in our domestic legislation and once you do that, problems begin to arise. How do you define caste? Sociologists have tried for 200 years, ever since the Portuguese invented the word caste. It is not an English but a Portuguese word; when they came to India, they found that we were classified in a certain way and called it caste. In India, caste is very much in flux thanks to globalisation, urbanisation and so on, and in Britain it is even more so. Castes are therefore difficult not only to define but to distinguish. Once one introduces this kind of indeterminate, inherently nebulous category in law, one invites difficulties. One could easily pave the way so that in 10, 15 or 20 years’ time there might even be a pressure of the exact kind we have now, where people might be saying, “Let’s have a question on caste in the census”.
If my grandchild were to ask me today or 10 years from now, “Grandpa, what caste do I belong to?”, I would not know what to say. A category as indeterminate as that does not deserve to be enshrined in domestic legislation. For these and other reasons I would be opposed to the amendment, while making it absolutely clear—so that I am understood outside this House—that untouchability exists. It is an abominable practice; people are sometimes discriminated against and the noble and right reverend Lord, Lord Harries, at a meeting he organised, produced people who were able to give evidence.
Take for instance a bus driver who happens to be a Brahmin or whatever, and there is a person who works on the buses who he would not want to team up with because the guy is supposed to have a surname that indicates he may be an untouchable. It exists in small pockets in those places where people are recognisable. It is not a pervasive phenomenon, but even if it is not pervasive, it is still not acceptable. The point is that it is only one extreme form of caste. By introducing caste as a general category in this way one is trying to catch too much and will end up catching too little.
Lord Singh of Wimbledon
My Lords, I speak in favour of this amendment. I am particularly concerned about the level of misinformation and ignorance used in the other place to argue against legislation. The Minister in the other place made a statement, which was repeated today, that caste is a problem in the Sikh community as well as among Hindus. It is not only inaccurate, but frankly insulting to the Sikh faith. Guru Nanak, the founder of Sikhism, totally condemned the whole system of caste. Opposition to discrimination based on caste, birth, gender, race or religion or social status is an essential pillar of Sikh teachings. Sikhism emphasised equality of respect and opportunity for all members of our one human family centuries before these concepts were accepted in the West.
The Sikh gurus repeatedly taught the absurdity of caste, in which the shadow of a person of lower caste was said to pollute the food of a higher caste. Guru Nanak urged them to forsake all notions of caste and ritual purity and look to the inner worth of individuals. That tireless campaigner for human rights, the noble Lord, Lord Avebury, from whom we have just heard, commenting on the egalitarian teachings of Sikhism at the time of my maiden speech, rightly emphasised Sikh opposition to caste, quoting Guru Nanak’s observation that in his mother’s womb no man knows of caste. Let us get it right. The concept of caste is a hierarchical division of Hindu society into the Brahmins, the top or priestly caste, with Khatris or warriors below, followed by those in commerce and then at the bottom Sudras, cleaners or scavengers. Caste has two essential components: a hierarchy of importance and a notion of ritual purity. Both are rejected in Sikh teachings. When a person converts to Sikhism he or she is required to renounce any former allegiance to caste. By definition one cannot be a Sikh and have a caste.
Guru Nanak warned us about the negative cultural practices that over the years attach themselves to our different religions and distort underlying ethical teachings. It is true for all faiths and it is certainly applies to caste which has little to do with the ethical imperatives of Hinduism. As far back as the 1930s many leading Hindus condemned the iniquity of caste. While Gandhi felt education was the answer, Dr Ambedkar felt education was not enough and legislative action was also necessary. Later, as author of the Indian constitution, Dr Ambedkar successfully included prohibiting discrimination on grounds of caste.
Coming back to this country, we too find ourselves in a debate over combating the evil of caste by education or by legislation. In this debate we have had some widely improbable figures on the number of Dalits in the UK. No such playing with figures is necessary. Whatever the numbers, that which is evil remains evil and Dalits are fully entitled to protection against discrimination, whatever their number.
Many—most—Hindus reject caste discrimination, but without firm action its negative influence could continue for years. It has no place in our more enlightened 21st century, and those who suffer its worse effects should, like those who suffer racial discrimination, be protected by law. Here it is necessary to add that, contrary to misinformation being circulated, legislation will not require people to associate themselves with a particular caste, just as protection against religious discrimination does not require anyone to affiliate themselves to a particular religion.
In conclusion, I should like to emphasise my comment made when we previously discussed this issue. I firmly believe that without the debilitating influence of caste the uplifting ethical teachings of Hinduism will be much more to the fore. It is for these reasons that I support the retention of our amendment.
Lord Deben
My Lords, first, I am sure that the whole House has very much been touched by the words of the noble Lord, Lord Singh, which have clearly put this issue into a proper context.
I say to the noble Lord, Lord Parekh, something which I hope he will not find difficult. I am old enough to have been through all the discussions about discrimination against homosexuals and against people on the grounds of class, race and gender. I fear that the four reasons that the noble Lord presents are always presented in these cases. That does not take away from his own belief in it, but that is what people always say. They say that there are not very many. They say that it is very difficult to draw the distinctions. They say that the matter is being healed anyway because there is a great movement to ensure that it does not happen. They say that people will become more discriminatory if the law intervenes. That is what they always say. It may be more true about caste than about other things. I merely say that those are the same arguments, and I find it difficult to take those arguments in this case when I did not take them in all the other cases.
Secondly, the Government have rightly said, and I am proud that they have done so, that discrimination on the grounds of caste is unacceptable in any circumstance. We do now at least start this discussion from the same basis. That is not how it has been in the past, because there have been arguments that caste is somehow different, and that you should not say this because there are cultural and religious reasons why you may not make that statement. I think that we are now as one on that. I thank my noble friend Lady Stowell for speaking so clearly about that.
The Government have, however, put forward two arguments in the discussions that seem mutually contradictory. On the one hand, they have said that their legal advice is that the present law clearly covers caste. They have then gone on to say that they do not want to include caste because it would be expensive to employers. You cannot have it both ways. If the present law covers caste, that is a cost to employers anyway. If putting “caste” in merely clarifies matters, you do not increase the cost at all. You can increase the cost only if by adding “caste” you have a different category that was otherwise not covered.
I hope we will accept that the cost argument cannot be true or the Government’s whole case falls down. I really hope we will hear no more about the cost argument. If we do, we should not be saying that people cannot be discriminated against unfairly, wrongly and wickedly but that because it is expensive to deal with it we are not going to deal with it. I am sorry, but that is not the politics I entered into and I am not prepared to take that. Let us just get rid of the idea that, somehow or other, we can argue this case on the basis of finance. That is a totally different issue and nothing to do with the moral issue with which we are concerned this evening.
I turn now to the point raised by my noble and learned friend Lord Mackay. He will no doubt make the point himself, but it fits into my argument at this point so I hope he will not mind me referring to it. He said he believed that the legal advice that caste was already included in the law was right but that because the previous Government—and this is no criticism of them—had put into the law a triggerable mechanism that could say that caste specifically was referred to, the courts might find it suggested that caste was not covered by the present legislation. The Government therefore have a real responsibility to ensure that their opposition to caste is not befuddled or mixed up because of an odd circumstance that was meant to be helpful but that has this downside in the legal judgment.
That leads to this House accepting that we are now on all fours. We now all say that caste is unacceptable and that people who are discriminated against on grounds of their caste should have a legal remedy. We are also, I hope, saying that the reason for a legal remedy is not just to help the individuals concerned but to lay down a quality of our society that says that this is not acceptable. It is after all a quality of Indian society that it is not acceptable. It is a quality of Nepalese society that it is not acceptable, and the Bangladeshis are presently seeking to have exactly the same quality. The idea that passing this law would in some way be insulting to Hindus seems to me to be absolutely outwith sense, and we have to make that absolutely clear. All we are saying is that we would do in this country what other countries have already done. It has not been seen as an insult to religion there, so that is not a reasonable argument.
We have to distinguish, in what the Government have placed before us this evening, between our common view that this has to be done and the precise view as to how. The issue before us is therefore not whether it is reasonable to take action but the best way to do it. The noble and right reverend Lord, Lord Harries, made a powerful argument to say that we should take this decision now, that we have been arguing about it for too long and that if we take this decision now we can subsequently sort out the problems that may arise around it.
The Government say, “We accept that caste is totally unacceptable, but we have a problem because we think it is reasonable that some people who manifestly have something to say about this do not feel that they have had a proper time for consultation”. They also say that they are not sure that they are clear on a number of points. I disagree with the Government on both these issues, because first of all there has been as much consultation as was necessary. It is also quite clear how you deal with caste. That happens to be my view. However, this House has to take seriously the Government’s role in this. This is a very difficult thing for me to say because I have been thinking and fighting about it for some time. I try to think back to the time when I was a Minister.
The Government have to think about something that the noble Baroness has not mentioned: that you do not start a new policy—because making this a legal matter is a new policy, even though we have been talking about it for so long—in the best possible way if a significant number of people, with some justification, feel that they have not been properly consulted. I say to my noble friend that I am pretty suspicious of some of the people who asked for consultation, because they do not seem to me to be overwhelmingly representative. They seem to be pretty clearly directed by those whose own interests are not those of the Dalits, so one has to be very careful about this.
On the other hand, I believe that in a democracy we ought to make sure that everybody feels that their voice has been properly heard. Therefore the noble and right reverend Lord, Lord Harries, says, “That’s all very well; we can sort that out afterwards. We ought to pass the law now”. I would have agreed with him if I had not understood what I now understand: that you need only secondary legislation of an affirmative nature. It is not very difficult to pass such legislation.
I now have to say something pretty tough to the Government. My noble friend Lady Stowell has been absolutely exemplary in these discussions. I know of no one who has gone to such trouble to try to sort this through, and I do not say that in the usual House of Lords manner to be polite to everybody. I am not like that. I want to be polite to her because I believe it and I want to say that. However, I have to say something very tough to her, which is this. She is asking us to believe that the Government will go through consultation, that the noble Baroness, Lady O’Neill, and her team will investigate this, and that if they have a clear recommendation we have to believe and have faith in the Government that they will then legislate in this way. She cannot tell me that they will certainly do that, because that would be to put governmental power into commission, and I rather agree with her that you cannot do that in advance. I wish I could not agree, but having been a Minister I have to admit that.
If we accept the Government’s statement here—and we come to a time just after the end of this year and the Government have been presented, before the end of the year, with a clear indication from the equalities commission that legislation is necessary—I hope the Government will understand that we will never trust them again if they do not then legislate. I do not think the Minister is giving us weasel words, but let us just realise that this is not the moment to pass something through to get it out of the system and then come back and say “Well, we didn’t really mean that”.
Baroness Thornton
My Lords, do I sense that the House would like to move on? I think that is probably the right thing to do.
Baroness Flather
I would like to speak, and the noble Lord, Lord Dholakia, wants to speak. We have been waiting for our chance.
Lord Dholakia
My Lords, I indicated that earlier, but I gave way to the noble Lord, Lord Deben, because I thought he made a very important contribution.
I am delighted to contribute on this amendment and I support the point of view that has been expressed by the noble Lord, Lord Parekh. I served on the former Commission for Racial Equality and its predecessor bodies from its inception in 1965 until 1994, a period of nearly 30 years. Almost all Race Relations Acts made provision for the Commission for Racial Equality, the Community Relations Commission and all those bodies to review the legislation and, if it was inappropriate or lacking, to make recommendations so that the Government had the opportunity to amend it. As we saw in the Race Relations (Amendment) Act, this exercise was carried out by the previous Government.
I owe a special debt of gratitude to my noble friend Lord Avebury. He was elected in Orpington in the same year that I was elected to a county council in Sussex. He has been my mentor all these years, but sometimes friends disagree. My experience is based, like that of many people I meet on a regular basis, on the impact of one’s culture and faith, which to an extent shapes lives both here and abroad.
The first point I wish to make is that, like the noble Lord, Lord Parekh, and almost every one who has spoken, I abhor racial discrimination on any ground of treating people differently. Colleagues in your Lordships’ House will remember that I have in the past 15 to 16 years succeeded in moving amendments to secure equality in a number of legislative measures. Over the past two years, I have chaired a substantial number of consultations with communities and individuals on matters of caste discrimination. Let me make their point of view clear in case there is any doubt: they fully appreciate the need for equality legislation. Indeed, ethnic communities would not have a voice without such legislation. They are adamant that they would not want to deny any disadvantaged group the right to have recourse against discrimination on any grounds. Almost every one of them has made that position very clear.
Caste plays the least significant part in the lives of third and fourth generation youngsters from ethnic communities growing up in this country. We have moved away from the old days and old values of compartmentalising communities based on caste. A generation has grown up seeing no obstacle to crossing the caste divide.
The second point I wish to make is that race relations in this country have always been based on sound research. The work of the former organisation that some may remember, which campaigned against racial discrimination and was headed in its early days by the famous Lord Pitt who sat in the House of Lords, produced evidence which resulted in the first Race Relations Act outlawing discrimination in public places. The substantial evidence produced by the Street report in 1967 identified discrimination in employment, housing and general services and resulted in the introduction of the Race Relations Act 1968. Similar evidence on institutional racism resulted in the introduction of the 1976 race relations legislation. However, in essence, there is a lack of evidence on caste matters. The report produced by the national institute clearly acknowledges that there is no evidence to suggest the existence of large-scale discrimination in this country based on caste.
Communities feel let down that during the passage of the Equality Bill through Parliament, having acknowledged that the available evidence did not indicate that caste discrimination was a significant problem in Britain in the areas covered by discrimination legislation, Parliament proceeded to accept an amendment to the Equality Bill to include caste as an aspect of race by a ministerial decision. By doing so, the Act which was supposedly designed to simplify and streamline discrimination law in Britain seems to have defeated this very objective by including the concept of caste that has eluded clear definition in common parlance, let alone in legal terms—the point made by the noble Lord, Lord Parekh.
However, it would be a big mistake to extend the scope of the act to include caste in Britain without substantial evidence. Laws should be based on sound evidential research. The research by NIESR clearly acknowledges that there is no large-scale caste discrimination in Britain. The sample was far too small to reach a fair conclusion. Therefore, to yield to pressure groups and include caste within the scope of the Act will only rekindle the dying issue of caste.
I fear that we are still studying something that may be on the surface. A generation of people born here have broken the links with caste patterns and they find themselves engulfed in a practice that was prevalent in the early history of the subcontinent. I accept that there may be discriminatory practices—rightly described by the noble Lord, Lord Parekh—where caste may have played some role but there are ways of dealing with this subject. I had discussions with my colleague, Lynne Featherstone, when she was looking at the issue as government Equality Minister and I explained that there are other ways we can tackle this matter in the short term. I welcome the statement issued by Helen Grant, Minister for Women and Equalities in the other place, that education is the right step to take in this matter. I also welcome the contribution on this issue of the EHRC and the Government’s equality officers in examining the nature of caste prejudice and harassment as evidenced by existing studies. This will indicate if the matter should be addressed in future years either by legislation or by another solution. I am happy to assist those who have participated in consultation to set up their own formal structure which could be the basis for eradicating discrimination practices. A conciliation process must be at the forefront of such a strategy. The community can and must provide that. Since the EHRC is now involved, it is right that we reject the amendment until we are better informed.
Baroness Flather
My Lords, I seem to be the last speaker and I will take this opportunity to say what has been in my mind. It is very interesting that we have two Hindus speaking today against this amendment. On the previous occasion one of them was here but did not speak up, yet that was the time to make his points about why we should not have voted in favour of a caste discrimination amendment.
I have found that all Governments in this country have a great belief in so-called “community leaders”. Ever since immigrants first came to this country they have created this myth of community leaders: community leaders know everything about the community; they will tell us what the community wants; they are the important ones. They are not the ones to speak for all communities: they are the ones who shout the loudest. It has always been a big mistake to listen to people who say, “We are the community leaders”. Have you ever seen a woman as a community leader? Have you ever seen any women in any consultation? Have you seen any women among all these men who have been shouting outside the House of Lords about the caste amendment? The Hindus have come together for the first time ever, to my knowledge, to shout about the caste amendment because they feel that this dishonours them in some way. They dishonour themselves: caste is a fact. It is not created by us or in the minds of the British or other people; it is a fact that people discriminate on the basis of caste. It is endemic in social issues like marriage. As far as public things like employment and education are concerned, we have to watch out: we have to say, “No discrimination on the basis of caste”. It is no good our saying, “Leave it for next time”; that happens all the time. There will be more consultation and more evidence, but there is already plenty of evidence of discrimination. As someone has said, if there are six people being discriminated against, we should do something about it. We do not know how many people are discriminated against.
We have been told about the untouchables. Caste is not about untouchability but about someone of a particular caste not being accepted by a person of a higher or different caste. It is about not giving them the same treatment as you give to people of your own caste. In my parents’ house, we were from the merchant caste and had to have a Brahman cook, otherwise people in our house did not eat. None of us were allowed in the kitchen because we would pollute it. I have lived with caste all my life, from childhood.
Baroness Thornton
My Lords, I thank the noble Baroness, Lady Flather, for her remarks and I would not for a moment dare to have stopped her contribution to this debate.
The principle that we are discussing remains as simple and straightforward as it was when it was debated in 2010, in Committee on the Bill and on Report. The question is: how do we give legal protection to the victims of caste discrimination? That was reflected throughout the debates in the Commons and this House. It is the case that there is a lacuna in our equality legislation, and surely it is our responsibility to ensure that this form of discrimination, however few the cases are—even if there were only one—has redress under UK law. We do not need any more research to tell us that there is caste discrimination and that it needs a legal remedy.
On these Benches we have been doing what the Government until very recently had signally failed to do over the past two to three years. We have discussed the matter with and made ourselves available to all the groups that have an interest, including those who have reservations and are opposed. I remind the House that it is only because the noble and right reverend Lord, Lord Harries, raised this matter in Committee that the Minister agreed to meet the anti-caste-discrimination groups after refusing to do so for more than two years.
We accept that the Government have some ground to catch up on in the implementation of this legislation and, in the spirit of the cross-party support for this cause, we would like to help them to do so. I am particularly grateful for the constructive dialogue that I and my colleagues in the House of Commons have had with the Alliance of Hindu Organisations, the ACLC, the Sikh Council and the British Sikh Consultative Forum, among others, as well as the Anti Caste Discrimination Alliance and the Dalit Solidarity Network.
I know the House will agree that it is important to put on the record that this is not about vilifying an entire community. Caste discrimination is not specific to any one religion but to residual social and cultural practice, and I hope that the Minister will agree with that. We believe that it is vital that this amendment is carried today and sent back to the House of Commons, because if we do so I am sure that the next stage will be one of negotiation about how, not whether, we deal with caste discrimination.
There are two reasons for that. First, only if we pass this amendment again will the Government realise that the serious matter of caste discrimination has strong cross-party support led by distinguished parliamentarians from all parts of this House and the Commons. Secondly, there is evidence, as the Minister’s remarks revealed, that the Government are considering their position again. We believe that the House of Lords reaffirming its view on this matter will help in that process and permit a discussion on how to move forward. This is the invaluable role that the Lords can play in such matters.
Since the House last discussed this matter, we in the Labour Party have been addressing the matter of implementation with the wide range of different groups that I have already mentioned. We wrote to the Minister over the weekend with our views and offered support, help and co-operation in the implementation of this legislation.
Coming from Bradford, I know that the south Asian communities are among the most enterprising and fair-minded in the UK, and that those community leaders who first arrived in Britain in the 1960s and 1970s do not need any lectures from us on the evils of discrimination. Yet, just because discrimination is perpetrated by a very small number of individuals, that is no reason not to have legislation.
Although I start from a different position in relation to legislation from some of the organisations that I have mentioned, I believe that we are all united in the view that if legislation goes ahead, and we hope it does, we must ensure that the process of implementation is right so as to prevent the entrenchment, rather than the eradication, of caste distinctions in British society.
As soon as this legislation is passed, we think that before the clause is enacted the Government need to commit to conducting a consultation on the interpretation of the term “caste”, which should be set out in guidance or secondary legislation. This would allow time and space to deal with the genuine concerns that have been raised, such as ensuring that this is not interpreted as religion-specific.
The Government should commit to setting out guidance or secondary legislation that employers or public bodies should not seek information about caste identification, nor must there be any requirement on individuals to disclose their caste. We know that this is possible with sexual orientation and we suggest that that holds the way forward. The goal must be to eliminate, not increase, the number of people being identified by caste. Therefore, if the legislation proceeds, we ask that Ministers seek to underpin the guidance with that principle.
This consultation detail and guidance needs to be in place before the new law is enacted. We are therefore happy to support community suggestions that there should be a delay in the implementation of the new clause for perhaps one year, possibly two, after the Bill receives Royal Assent.
We have suggested that the Government should consider a timetable for a statutory review of the clause. There is a clear consensus and commitment across all communities to work to eliminate caste divisions in the UK and ensure that the UK remains, as one individual put it, “the great leveller that it is”. If it comes to a point where caste distinction has become a non-issue in the UK, we should recognise that legislation may not be needed any more, so perhaps there should be a review in 10 to 15 years from commencement.
I think the Government have not thought through their Talk for a Change education programme. It must not be a project that aims to better inform individuals about caste in a way that increases the awareness and use of caste as an identifier and divider. Will the noble Baroness clarify that the Government’s purpose is to facilitate initiatives within communities to address existing residual discriminatory practices?
The Minister will argue that the Government want to consult first on whether to provide legal protection, which I think is the point of her remarks. The Government have come a long way in thinking about this, but we part company from them because we believe that we need to pass this amendment now, to get the legislation on the statute book, and then to resolve the issues that flow from that. That is why we again support the noble and right reverend Lord, Lord Harries, from these Benches.
I regret that the noble Lord, Lord Deben, has, as it were, decided to cave on this matter, although I accept that he has made great threats to the Government, which I am sure they are taking on board. He is right that this is a question of trust. The Government have had two years, almost three, to deal with this issue and have done nothing at all until this moment. I wonder what guarantee can be given by the Minister, other than legal protection, about taking this issue forward; her remarks leave it open to doubt whether the Government are prepared to do so. If this House does not keep the Government’s feet to the flame on caste discrimination, we must fear that it will be kicked into the long grass again and that nothing will happen. I hope that the Minister will agree to this amendment today. If not, I hope that the House will again support the noble and right reverend Lord, Lord Harries, and a move to discuss implementation in a way that achieves the goal of eliminating caste-based discrimination.
Baroness Stowell of Beeston
My Lords, I am very grateful to all noble Lords who have contributed to this debate. There have been some important and powerful speeches tonight, as there have been at all stages of the passage of this Bill. I will do my best to respond to most of the points that have been raised but will try not to take too much time, so forgive me if I do not go into great detail.
First, in response to the noble and right reverend Lord, Lord Harries, I will just clarify something that I said which he picked up on. The Government are not suggesting that we should replace the word “caste” with the word “descent”. That is not something that we are proposing; I raised it purely to highlight that it that had been raised by others in the course of this debate.
Several views have been expressed in the Chamber this evening. The noble and right reverend Lord, Lord Harries, questioned a comment I made that some people do not want to be defined by caste. He argued that that should not lead to a decision that we should not recognise caste in law in order to protect against discrimination. I will make a couple of points in response to that. First, over the past couple of weeks in the discussions that the Government have had with different bodies, it has been made very clear to me while attending those meetings that some people do not want to be defined by caste and are worried that caste legislation would allow that. In response to the noble Baroness, Lady Flather, the person who made that point most forcefully to me was a woman from the Hindu community.
It was interesting and illustrative that the noble Lord, Lord Singh, made the point that caste is absolutely not a feature at all in the Sikh religion. The noble Lord, Lord Parekh, said that caste is something that can be recognised across a wide range of different faiths. Indeed, the noble and right reverend Lord, Lord Harries, talked about this being something that can be found in the Christian faith. There are clearly, just in the debate that we have had this evening, several views being expressed in this regard.
Lord Harries of Pentregarth
I thank the Minister again for the great care, thought and seriousness with which she has addressed this issue this evening and on other occasions, and the way in which the Government have clearly moved quite a long way in the direction of the supporters of the amendment. I thank all noble Lords for what they have contributed. I also pay tribute to those outside this House who believe that they are discriminated against, who have ensured that we have had this serious debate this evening.
In his thoughtful speech, the noble Lord, Lord Parekh, said that the issue of caste was so wide that ill founded complaints of discrimination would arise. He gave the example of himself from a goldsmith background perhaps not employing somebody from a blacksmith background and this being the subject of a complaint. But I cannot see that this would be essentially different from other areas of discrimination; for instance, a woman might complain that she is discriminated against because she is a woman and a tribunal would have to make up its mind whether it was because she was a woman or she simply was not up to the job. The situation is absolutely no different. The noble Lord then said that caste is such a wide concept that it really cannot be included in legislation at all. What about the example of India, which includes in its constitution the fact that caste discrimination is totally contrary to the legal system?
The noble Lord, Lord Dholakia, suggested that people in the third and fourth generations are not aware of their caste and, as it were, have outgrown it. I have to point out that that is not the evidence that the NIESR found. It found that there was bullying going on in school playgrounds on the basis of caste. The noble Baroness, Lady Flather, also mentioned coming across it when she was a teacher—sadly, it has not gone.
The noble Lord, Lord Gummer, rightly pointed out that even if there were only a few cases of discrimination, those people must be protected by law. What the noble Lord, Lord Gummer, said highlights the fundamental issue tonight.
Lord Harries of Pentregarth
I am sorry—we are old friends; we know each other from previous incarnations and go back to 1958, when I remember him this high. I apologise: what the noble Lord, Lord Deben, said highlights the fundamental issue of the kind of consultation that people have in mind.
The Government have in mind a wide-ranging consultation to decide whether legislation is necessary. Many of us are convinced that it is and that the consultation needed should be more sharply focused to ensure that the actual regulation that goes with it reflects what the communities most affected by it believe will be clear and workable in law. There is a clear difference between the kind of consultation that we have in mind and that the Government have in mind. We believe that it is important at this date to make it quite clear that legislation is necessary to protect people.
We have had such a serious debate tonight and the issues have been so thoroughly debated that I feel that it is right that the opinion of this House should be tested.
Viscount Younger of Leckie
That this House do not insist on its Amendment 38 and do agree with the Commons in their Amendments 38A and 38B to words so restored to the Bill.
Viscount Younger of Leckie
My Lords, this is an issue that has already been debated in some detail. Noble Lords will recall that the Government were nearly successful in persuading the House to accept the vote on Report, losing by the smallest of margins—indeed, by just two votes. Nevertheless I reassure noble Lords that the Government have listened to and carefully considered both the extensive arguments made, and the heartfelt concerns expressed, about the possible effects of this change. However, the Government feel strongly that a measure to reassure business is necessary, and the other place clearly endorsed that view by a majority of 75 when it voted on this issue last week.
This measure is one of a number of reforms designed to address the much wider issue of the perception of a compensation culture and the fear of being sued that this generates. It is a fear that drives employers to overimplement the law, incurring unnecessary costs, and that undermines their confidence to grow and develop their businesses. It is a problem that I believe we all recognise needs to be tackled, and one that we have not only considered in relation to this clause but, as many noble Lords will recall, debated in some detail in relation to my noble friend Lord Young of Graffham’s report Common Sense, Common Safety. It is because of this wider context and its detrimental effect that the Government remain of the view that it is not reasonable or fair that employers should be held liable to pay compensation when they have done nothing wrong and taken all reasonable steps to protect their employees.
We acknowledge that this reform will involve changes in the way that health and safety-related claims for compensation are brought and run before the courts. However, to be clear and to avoid any misunderstanding that may have arisen, this measure does not undermine core health and safety standards. The Government are committed to maintaining and building on the UK’s strong health and safety record. The codified framework of requirements, responsibilities and duties placed on employers to protect their employees from harm are unchanged, and will remain relevant as evidence of the standards expected of employees in future civil claims for negligence.
As I set out on Report, the clause provides for a power to make exceptions. It is already planned to make such an exception in respect of pregnant workers in order to comply with the terms of the relevant EU directive. We have thought carefully about whether there are more exceptions that should be made at this stage, but have not identified any other examples. However, I assure the House that we will seriously consider any further exceptions that are suggested.
To be successful in providing the reassurance that businesses need to overcome their fear of being sued, we need to take decisive action that will send a clear and effective message. The Government believe that the proposed single amendment to the Health and Safety at Work etc. Act achieves this by providing a consistent approach to civil litigation across all health and safety legislation, which will be simple for both employers and employees to understand.
To clarify a point of detail, I should also explain that amendments regarding the words “so restored to the Bill” have the effect of reinstating government amendments agreed without objection in Grand Committee. These amendments were made to comply with the Delegated Powers and Regulatory Reform Committee recommendation to remove a new regulation-making power that had been inserted as proposed new Section 47(2B) of the Health and Safety at Work etc. Act. The Government reflected on the committee’s comments and accepted that it was not necessary to take such a power, as there are no current plans to extend the policy to other legislation.
For the reasons that I have set out, I ask that noble Lords do not insist, as the noble and learned Lord, Lord Hardie, asks, on their Amendment 38. I beg to move.
Motion D1
Moved by Lord Hardie
As an amendment to Motion D, leave out from “House” to end and insert “do insist on its Amendment 38”.
Lord Hardie
My Lords, before addressing the main issue I should indicate that I have no objection to the amendments that the Commons introduced to reinstate the amendments that were agreed in Grand Committee, if the decision of the House is to refuse this amendment.
The main issue relates to Clause 61, which amends the existing law by removing a right of action that has existed for almost 150 years, permitting employees and their dependants to claim damages for injuries caused by an employer’s breach of statutory duties, which is designed to protect employees from serious injury or death. It is a separate common-law right of action and is distinct from the common-law action based upon negligence.
Baroness Turner of Camden
My Lords, the Government introduced at a late stage in the Commons proceedings, and with very little consultation, a clause to remove civil liability from health and safety offences. This would mean, as has already been explained, that a worker who is injured because their employer broke the law by failing to carry out a statutory obligation would find it much more difficult to claim compensation for the injury. It would also make the law much more complex. As a result, many workers or their dependants will lose out on compensation, causing further injustice.
The Government have claimed that they introduced this amendment to implement a recommendation from the recent Löfstedt report into health and safety regulations. However, Professor Löfstedt has since made it clear that this is not what he proposed and the government amendment went well beyond what he recommended.
We voted to remove the clause in a move that was welcomed by victims’ groups, the legal profession and health and safety professionals. The Commons, however, has voted to disagree with our amendment. I do not know why. We should maintain the position that we took up before; it is reasonable and fair. We have to remember that there are many industries anyway where there are inherent dangers to workers. Where there are statutory regulations, those should be applied and the workers should be able to claim if those statutory regulations are not complied with, which is what the present law provides for. We have been advised by lawyers concerned with these employment issues that if the amendment we are proposing is not carried and the Government’s position is maintained, we would be taking the law and the employment right consequent upon it way back beyond the beginning of the previous century. That really is quite unacceptable, and I hope therefore that your Lordships will agree to maintain the position that we took before as far as this clause is concerned.
Lord Faulks
My Lords, I was unable to attend previous debates on this clause but I have had an opportunity of reading what was said in your Lordships’ House and in the most recent debate on the amendment in the other place last week. I declare an interest as a practising barrister with experience in this area of the law and as a former special adviser to the last Government on an inquiry into the compensation culture.
Noble Lords, and particularly the noble Lord, Lord McKenzie, in a number of thoughtful contributions to the debate, suggested that to legislate on the mere perception of a compensation culture was to do so based on a “flimsy structure”. He accepted that there had been a problem of overcompliance with health and safety but he said that there was now a problem with undercompliance. I am unsure of the basis for this last assertion and it is not reflected by the report of Professor Löfstedt or by the report two years ago by my noble friend Lord Young of Graffham. Both identified a perception of a compensation culture, as did the report produced by Parliament when I was a special adviser. This cannot be dismissed on the basis that to respond to it is simply to pander to myths. There is a strongly negative effect on employers and indeed on schools and local authorities which feel the need to set up elaborate systems to combat largely hypothetical risks. Overcompliance costs time and money and makes it more expensive and less attractive to employ anyone, particularly for small and medium-sized enterprises.
The aim should surely be to ensure that all reasonable steps are taken to protect the health and safety of employees, but at the same time employers should not be overburdened with unnecessary and elaborate bureaucracy which can be the enemy of enterprise. I accept that this is a very difficult target to hit and I confess to being a little nervous about how much is left to regulation. However, I feel much more confident in saying that the debate, principally in the other place, was positively riddled with hyperbole. Both there and in your Lordships’ House the opposition Front Bench used the expression “a near impossible burden” when describing the prospects of a claimant bringing a successful action for injuries at work. I simply do not accept that. A breach of a regulation will be regarded as strong prima facie evidence of negligence. Judges will need some persuasion that the departure from a specific and well-targeted regulation does not give rise to a claim in negligence.
Many regulations are sensible, comprehensible and can be effectively interpreted both by employers and the courts, but this is not always the case. For example, the Management of Health and Safety at Work Regulations 1992 were revoked and re-enacted by similar regulations in 1999. Originally they did not give rise to a civil course of action—they now do. The regulations are extraordinarily wide and extraordinarily vague and seem to require extremely elaborate arrangements, ostensibly for health and safety purposes, in particular as to risk assessments. What a risk assessment is and how you prove you have done an appropriate one is problematic. It seems to require quite a number of employees simply to be devoted to compliance with the regulations rather than actually doing the underlying work.
It was said in the other place that this prospective change in the law was “not about compensation” but about “not being killed” and that the change was not simply a matter of red tape. I am afraid that I do not agree with the burden of those comments. Nor are the Government seeking to turn back the clock a hundred years. Rather, these provisions are a response to an overreaction to an entirely appropriate aim which is to ensure health and safety at work. The problem of overreaction is having a negative effect on enterprise. To borrow the title of the report of the noble Lord, Lord Young, the aim of this change in the law is to restore common sense and common safety. I support the Government’s position.
Lord Pannick
My Lords, I supported the noble Baroness, Lady Turner of Camden, and the noble and learned Lord, Lord Hardie, on Report, and I continue to do so. The Minister said earlier in this debate that we are considering cases where the employer has done nothing wrong. With great respect, that is a fundamental misunderstanding. The employer is liable only if the claimant can prove a breach of health and safety legislation. The employer is liable only if the claimant can prove that the breach has caused the injury. To require the employee also to prove negligence would impose an unreasonable burden. I take the point made by the noble Lord, Lord Faulks, that it is not an impossible burden. However, I suggest that it is an unreasonable burden because the relevant information will normally be information in the knowledge of the employer, and the costs and delay of the litigation—a point which the noble Lord, Lord Faulks, did not mention—would surely be disproportionate in all these circumstances to any legitimate interest, especially when the reality is that the employer can, and normally does, have liability insurance. For those brief reasons I will support the noble and learned Lord, Lord Hardie, should he divide the House this evening.
Lord McKenzie of Luton
My Lords, we remain steadfast in our opposition to the Government’s position, and fully support the case led by the noble and learned Lord, Lord Hardie, and spoken to in support by my noble friend Lady Turner and the noble Lord, Lord Pannick. We are dismayed that parliamentary process has allowed so little time for consideration of this matter in the House of Commons and that more than a century—in fact, nearly 150 years—of settled law is being overturned on the basis of such brief deliberation.
The arguments to remove Clause 61 from this Bill have not of course changed in the few weeks since we last debated the matter. Nor have the serious consequences which will ensue should we not carry the day. Removal of the existing right of an employee to rely on a breach of health and safety legislation represents a fundamental shift, and one which is to the detriment of employees.
We heard before, and again today, that having to prove negligence will provide a more difficult route to getting redress. The burden of proof will shift to employees, or to the family in the case of a fatality at work, there will be a requirement for more evidence-gathering and investigation, and the incurring of greater costs. In that respect there will be no lessening of the regulatory burden on employers. This change goes well beyond the issue of strict liability which the Government’s own impact assessment accepts is likely to give rise to only a small number of claims.
The issue of a near impossible burden referred to by the noble Lord, Lord Faulks, I think in our previous debate, was not applied generally but specifically to those circumstances where strict liability has hitherto been in force.
Lord Faulks
I am grateful to the noble Lord for giving way. The point is that there is always a claim, as I am sure he will agree, in negligence. Whether there is a breach of a regulation will be strong evidence of a departure from an appropriate standard of care. All that is changing is simply that it is not actionable per se. I would like the noble Lord to say why he adheres to his suggestion that there is a near impossible burden.
Lord McKenzie of Luton
The point I sought to make is that in some circumstances it has been accepted, I believe, that there is a near-impossible burden. That is not necessarily the case, but even the route to proving negligence is a greater burden than the route to proving breach of statutory duty, which is what operates generally at the moment. The “near-impossible burden” description was particularly applied to those areas where strict liability applies in circumstances related to the provision of equipment, where purchased, maintained and sourced by the employer, and the employee is in a disadvantaged position in seeking to prove negligence.
The impact assessment recites the belief in a compensation culture which is having an impact on the behaviour of business. However, even if true, why on earth should it be a justification for reducing access to justice for employees injured or made ill by their work? This cannot be a rational basis for acting. Why should employees bear the strain of tackling these perceptions? Where is the evidence that unreasonable claims are being made and indeed settled? If there are fewer claims, the beneficiaries, as we have heard, will be the insurance companies, the providers of employer liability insurance. Where the Government are particularly remiss is in failing to see this from the perspective of the individuals who are injured at work, because one way or another they and their families will bear an increased burden. They may be forced to place greater reliance on the health, caring and benefits system. What does the Minister say to those families whose circumstances may have been eased by receiving compensation but who face a life on benefits in the future? Health and safety impacts on the lives of millions of individual employees every day of the week. It is not some distant concept related to red tape.
There is undoubtedly some overcompliance with health and safety requirements, but there are ways in which this can and is being tackled. The register for consultants is one route that the HSE is seeking to apply. However, there is also undercompliance. The noble Lord, Lord Faulks, asks what my evidence is for that. Let us look at the data. People are still being killed at work and hundreds of thousands of people are injured every year. I spent three and a half years as Minister for health and safety. We know those sectors where there is a struggle to get compliance. It does not operate across the board. There are some very good employers who try to do the decent thing, but there are some who do not. This undercompliance has been made worse by restrictions on funding, by limiting the regulator’s role in proactive workplace inspections, and by the portrayal of health and safety as red tape and its undermining by myths that bear no relation to reality. Promoting the changes in Clause 61 will also send the wrong message to those employers who would undervalue health and safety and cut corners, safe in the knowledge that their chances of being held to account are diminished. This is to the detriment not only of employees but of those many employers who do the right thing.
The Government’s position is untenable. It is changing the settled legal position of over a century on the basis of anecdote and perceptions. It is making it harder, sometimes impossible, for employees to access justice when they are injured at work. It is undermining the cause of health and safety. The Government have failed to consult properly on this or make reference to the EU. They offer an inappropriate remedy to any perceived compensation culture which can and should be addressed by other means. Most of all, they are careless of the personal cost to those who are damaged by their work. That is why we support the amendment of the noble and learned Lord.
Viscount Younger of Leckie
My Lords, I have again listened with interest to the arguments made and thank noble Lords for their careful consideration of this very important issue. I start by challenging the noble and learned Lord, Lord Hardie, and the noble Lord, Lord McKenzie, on whether there is a compensation culture. The noble and learned Lord raised that point. I clarify again that my noble friend Lord Young and Professor Löfstedt underlined that health and safety regulations, more than any other area of regulation, suffer from misinformation and overcomplication in the media and elsewhere. I was grateful for the intervention by my noble friend Lord Faulks on this issue.
As Professor Löfstedt found in his independent review, these myths lead to confusion about what the law requires and a fear of being sued which drives employers to overimplement the law in an effort to protect themselves. This does not lead to better protection for employees but means that employers are spending significant time and resources on activities and services which are not necessary or far in excess of what the law requires. Concern about “getting it wrong” discourages employers from looking at ways to develop and grow their business and consequently from taking on new employees. I reiterate to the House that this is a real issue and that there is a perception in this regard. We believe as a Government that we should be tackling it.
The noble and learned Lord, Lord Hardie, referred to certain cases which were raised in the other place by the honourable Member for Middlesbrough. We have been able to check the facts of two of those cases. In both of them there is prima facie evidence of negligence on the part of the employer. We would expect that such cases would still be brought as negligence claims if brought after this amendment to the Health and Safety at Work etc. Act. It is important to clarify that point.
The noble and learned Lord, Lord Hardie, mentioned removing the right to compensation and depriving families of it in the event of an employer’s breach of statutory duties. The Government’s view is that it is fair and reasonable that this burden should be removed from an employer who has done nothing wrong. The fact that someone has been injured at work does not mean that they are automatically entitled to compensation. Ours is not a no-fault system. Many health and safety duties require the injured employee to show fault on the part of their employer. It is interesting to note that currently claimants do not recover compensation in about 30% of claims.
There can be cases of misfortune to which I alluded on Report, which cannot and should not be laid at the employer’s door. In order effectively to tackle the fear of being sued and of unjustified reputational damage, and the costly burdens on business this brings, employers need to know that they have a fair opportunity to defend themselves.
The noble Lord, Lord Pannick, spoke of the burden of proof shifting to the employee, as he put it, being unreasonable. However, the cases that will be most significantly affected by this change are those which would have previously relied on an absolute or strict liability duty. Under the existing system, employees have to prove that their employer breached the standard required in the regulations and that the breach caused the injury. In practice, the issues and evidence that will need to be examined in relation to a claim for negligence will be similar to those currently examined in relation to a claim for breach of a duty which is not a strict one and qualified by, for example, the wording,
“so far as is reasonably practicable”.
That point was raised earlier. Indeed, most cases are currently brought for both breach of statutory duty and negligence, so it is anticipated that most claims will still be able to be brought.
The noble Baroness, Lady Turner of Camden, said that a different approach had been taken to Professor Löfstedt’s recommendation. The Government agreed with Professor Löfstedt’s recommendation in principle, recognising the unfairness which results where employers are liable to pay compensation regardless of having taken all reasonable steps, and agreed to look at ways to redress the balance. Excluding civil liability only in relation to specific strict liability offences would mean making a large number of amendments to more than 200 regulations and could result in different approaches to civil liability being applied within a single set of regulations and across the regulatory framework. This would add a layer of complexity to the current system leading to greater uncertainty for both employers and employees about the duties that apply in respect of compensation claims. Making a single amendment to the Health and Safety at Work etc. Act has the significant advantage of delivering a consistent approach across all health and safety legislation.
I reiterate that this reform is not about reducing the number of claims made, but about establishing the important principle that employers should always have the opportunity to defend themselves against a compensation claim when they have done nothing wrong and have taken all reasonable precautions to protect their employees. By providing the reassurance that they will not be liable if an accident happens which is totally outside their control, this change will support responsible employers who take care to protect their employees by giving them the confidence not only to take sensible steps to manage health and safety risks but also to expand their businesses into new areas and activities and to take on new employees to achieve this. The Government believe this to be a fair and proportionate response to the impact that strict liability duties currently have in the civil litigation system.
Business is fully behind the need for action in relation to the perception of the compensation culture. More specifically, it is supportive of the approach that the Government want to take in relation to the issue of strict liability duties. I am most grateful to my noble friend Lord Faulks for his succinct intervention, backed by his experience in the field. This support was also reaffirmed by both the British Chambers of Commerce and the Federation of Small Businesses in correspondence received in the last few days. I therefore ask again that noble Lords do not insist on their amendment on this issue.
Lord McKenzie of Luton
Before the Minister sits down, can he just help us with one issue? If it is the Government’s position that the problem to be addressed is the perception of a compensation culture, why should that be addressed by making the reality of accessing compensation claims more difficult?
Viscount Younger of Leckie
I reiterate that the balance is not right. We have been much helped by the report from my noble friend Lord Young and Professor Löfstedt, who have provided this perception and provided the evidence to allow us to act. This is the right approach for the Government to take.
Lord Hardie
Does the Minister accept that regulations that have the qualification of reasonable practicability afford an employer the opportunity of defending himself against a breach?
Viscount Younger of Leckie
The noble and learned Lord makes a fair point. Employers will continue to need to have to defend themselves. The issue depends entirely on the particular case in hand but this government action redresses a balance that is long overdue.
Lord Faulks
Before the Minister sits down, I am sure he will agree that, while some of the regulations have the defence referred to by the noble and learned Lord, quite a few of them do not provide this defence at all and there can be automatic liability without any fault. Does he agree that one of the problems of the perception of a compensation culture—there was perhaps an inadvertent hint of this—is the fact that these changes are not welcomed by safety consultants or those who are concerned to gold-plate some of these regulations?
Viscount Younger of Leckie
I am grateful for the points made by my noble friend. That is a very helpful intervention.
Lord McKenzie of Luton
Can the Minister give us some examples of where there is gold-plating of regulations under health and safety provisions?
Viscount Younger of Leckie
I believe that I covered in Committee and on Report all the aspects that I need to.
Lord Hardie
I am grateful to noble Lords for their contributions to this short debate. I note that the Minister and the noble Lord, Lord Faulks, accept that there are a number of regulations which have the qualification of reasonable practicability. Those regulations afford the employer the opportunity of defending his actions by saying, “I complied with these regulations so far as was reasonably practical”. If he proves that to the satisfaction of the court then he will avoid liability.
That brings me back to a point that I sought to make earlier. Why should a right of action be excluded from those regulations? If the intention of the Government is that employers should not be blamed for something that they have not done and should have an opportunity to defend themselves, then the qualified regulations do precisely that. There is no justification in law or in logic for removing the right of action in those regulations, which, as I have said, comprise the majority of the regulations.
I am grateful to the noble Viscount for researching the cases mentioned in the other place by Mr McDonald. I accept what the Minister said—that two of the cases would have succeeded at common law, contrary to what Mr McDonald said. However, according to the Official Report, there was a specific finding by the court that there was no common-law liability in the case of the roofer and slater, Mr Hill, who,
“fell from scaffolding during the course of his work and suffered very serious injuries resulting in incomplete tetraplegia. The accident occurred as he came down the scaffolding on a portable ladder that was not fixed or in any way secured; he fell to the ground, causing the injury. His injuries were so severe that damages were agreed at just under £2 million. The court held that there was no liability at common law, but there was liability under the Work at Height Regulations”.—[Official Report, Commons, 16/4/13; col. 236.]
That is a specific example of a case where common-law liability was unsuccessful but the plaintiff managed to secure damages because the employer had failed to comply with regulations designed for the safety of his employees and that failure was the cause of the accident. If Clause 61 had been in force, Mr Hill would have received no damages because he would have failed to have established his common-law claim for negligence.
The issues have been well canvassed and I feel strongly that this clause interferes with a fundamental right. No justification has been put forward for it and the Commons has not really considered the Lords’ discussions on this matter and has given no reasons for disagreeing with Amendment 38. I would welcome the opinion of the House.
Viscount Younger of Leckie
My Lords, on Report we debated the amendment in the name of the noble Baroness, Lady Hayter, on letting and managing agents. I made it clear then that the Government could not accept her amendment but that we were giving most serious consideration to the issue of redress. The noble Baroness confirmed that it was a redress mechanism that she was seeking in her amendment.
The Government have given serious consideration to these issues. We have considered reports by the Office of Fair Trading, Which?, the Royal Institution of Chartered Surveyors and others, and we have listened carefully to the debate here and indeed in the other place. The Government recognise that the fact that not all agents belong to a redress scheme has been an issue of growing concern. We are satisfied that making this a requirement would provide both the means of addressing complaints when things go wrong and a means to improve service quality across these important parts of the housing sector.
Providing access to redress would deal with many of the failings that people are concerned about in their day to day dealings with letting and managing agents. At the same time, the existing consumer protection and leasehold legislation remains in place and is already available, and is indeed used for the more serious matters.
Having listened to the concerns raised most specifically in this House by the noble Baroness, Lady Hayter, and others, including my noble friend Lady Gardner, the Government have introduced in the other place an amendment in lieu of the amendment tabled by the noble Baroness, Lady Hayter. The government amendment gives powers to require letting and managing agents of privately rented and residential leasehold homes to belong to a redress scheme. It gets to the heart of what the noble Baroness, Lady Hayter, was seeking, but without subjecting letting and managing agents to the additional layers of regulation that are in the Estate Agents Act and on which her amendment was based.
I am pleased to say that, while clearly some would have liked the Government to have gone further than redress, this amendment has been warmly welcomed and was approved without Division in the other place. Indeed, the honourable Member for Streatham, shadow Business Secretary Chuka Umunna, described it as,
“a victory for tenants and landlords””.—[Official Report, Commons, 16/4/13; col. 229.]
The Government’s approach has also been welcomed by key organisations. For example, the National Approved Letting Scheme welcomed it as a common-sense approach to improving the consumer experience of renting and letting and a sensible alternative to the heavy-handed bureaucracy of a formal regulatory regime. Similarly, the National Landlords Association has endorsed the Government’s approach of meeting the challenge of regulating letting agents head on, rather than simply applying the standards of estate agency to a distinct sector with its own significant risks.
If these clauses are enacted, the next steps will be for the Department for Communities and Local Government to consult on the details of the measures and to go through the formal scrutiny processes so that the necessary orders can be brought forward for approval in both Houses. We would expect consultation to be under way by the summer.
In their consultations, the Government will wish to take account of a number of the points that have been raised in the other place, for example on how existing codes of practice will be reflected in the redress schemes. There were also questions in the other place about the residential leasehold sector, generally echoing concerns that have been raised by my noble friend Lady Gardner of Parkes. The Department for Communities and Local Government is taking forward work on these issues, following its recent round table meeting, which my noble friend attended. I know that it will continue to involve my noble friend and a broad range of other interested parties on these matters.
My honourable friend in the other place, the Housing Minister, Mark Prisk, has spoken to the honourable Member for Worthing West about the points that he raised on the Leasehold Advisory Service and has now written to him.
The Government consider that this amendment can make a real improvement to the operation of letting and property management agents, for a very modest and proportionate regulatory burden. I am grateful to bodies such as the Office of Fair Trading and Which? for rightly bringing attention to these issues, and to noble Lords who have worked hard to bring these measures within the current Bill, in particular the noble Baroness, Lady Hayter, and my noble friend Lady Gardner. I also acknowledge my honourable friend in the other place, the Housing Minister Mark Prisk, who has a long-standing interest in this issue and has worked hard to deliver a workable redress mechanism within the current Bill.
I therefore ask that noble Lords do not insist on their amendment and instead agree with the other place on its amendments in lieu. I beg to move.
Baroness Hayter of Kentish Town
My Lords, I welcome and support Motion E. I pay tribute to a number of key players who have brought us to this happy position. First, there is the coalition of those interested in the well-being of tenants and landlords, as the Minister has mentioned, such as Which?, Shelter and RICS, which have given me a lot of help not only in drafting but in the persuasion, if I may say, of this House and then the Government, who perhaps were a little reluctant to start with but have made a very large step forward. The coalition that came together included representatives of tenants and landlords, as has been mentioned, but also the British Property Federation, the Mayor of London and various London councils, as well as the professional organisations to which some of these bodies belong.
The amendments in lieu are not exactly the whole of what the House asked for in passing my original amendment, in that they do not include a role for the OFT in debarring agents who go seriously astray. However, I am confident that with the build-up of intelligence by the various redress schemes, evidence will come to light on which the OFT or Trading Standards will be able to take action.
Furthermore, as happened with estate agents and as has been suggested in the consultation, ombudsmen will develop codes of conduct for letting and managing agents—based, no doubt, on the professional codes that they have in place now—to give member agents guidance as to how an ombudsman will decide a case. That is perhaps a backdoor way to the adoption of a code, but is very welcome for all that.
In due course, I and consumer groups will no doubt be asking for further regulation of letting and management agents if this measure proves insufficient to protect landlords and tenants, and I have a feeling that the noble Baroness, Lady Gardner, is not about to let this wider issue drop.
For the moment, I conclude by thanking our Lords PLP staff, Beth Gardiner-Smith, Sophie Davis and Ian Parker, for their help, and saying a very genuine thank you to both the Ministers who are with us this evening. They took a lot of trouble to listen to our concerns very carefully and—I am sure at some personal risk to themselves—battled with their colleagues at the other end to win through. This House has brought some good home sense to an issue that is of great importance to thousands of our fellow citizens.
Lord Sharkey
My Lords, I want to say two things. First, I congratulate the noble Baroness, Lady Hayter, on her determination and persistence in pursuing the case for a redress system for letting and managing agents, and I thank the Government for agreeing to act.
Secondly, I want to ask the Government about timing. The Minister knows that the amendments are couched in terms of “may” rather than “must”, but I am sure that in this case that means “will”. The question really is: when do the Government expect to be able to bring forward the appropriate orders? As we have all said in discussions on this issue, the matter is urgent; people are suffering now. Can the Minister give some indication at least of the expecting timing of the orders?
If it were not getting on for midnight, I would also ask what on earth Commons Amendment 40A(6) actually means. But it is getting on for midnight, so I will not.
Baroness Gardner of Parkes
My Lords, I congratulate the noble Baroness, Lady Hayter. This is a great personal success on her part. She has been persuasive. She has managed to encourage us all by winning that important amendment, and without that we would never have got to this point where people have really looked at things and decided that something can be done.
As the noble Baroness said, this is not something that we are going to let die, or lie, because there is still so much more to be done. Another hopeful thing has been the new Minister for Housing. With experience and work in the field as a surveyor, he knows what we are talking about, and this has made a big difference, particularly when we have had various round-table meetings. People have adopted the attitude that they want to look into things further. We have been given hopes that that they will look into everything much further later in the year, and I will be pressing that in my questions. As you know, I am particularly interested in reducing the percentage of people required to have commonhold instead of leasehold, because that would solve a lot of problems, but everyone agrees that 100% is an impossible requirement.
I pay tribute to the two Ministers. My noble friend Lord Younger has done a great deal, and it is marvellous that he has allowed housing to come into this, which was such a BIS affair. I cannot speak too highly of my noble friend Lady Hanham, who knows the housing issue so well. It is due to her persuasiveness that we have managed to get things to this point and have received notice today of these amendments. As has been said, perhaps they do not deal with everything, but they go a long way and are a huge first step. That is what we need, and again I am delighted to welcome these changes.
Viscount Younger of Leckie
My Lords, I am grateful for the contributions to this short debate. We have heard a small number of contributions today on the amendment on the letting and managing agents. As we know, this is a practical measure that can be taken forward rapidly to make a real difference to the experiences of landlords, tenants, freeholders and leaseholders.
In an attempt to answer my noble friend Lord Sharkey’s question, although the timetable is unclear at the moment I am not out of step to say that we fully expect orders to be brought forward by the end of the summer. It might be earlier.
In conclusion, I commend this Motion to the House.