House of Commons

Wednesday 7th May 2014 Commons Chamber

Wednesday 7 May 2014

The House met at half-past Eleven o’clock

Prayers

Wednesday 7th May 2014 Commons Chamber

[Mr Speaker in the Chair]

Oral Answers to Questions

Wednesday 7th May 2014 Commons Chamber

The Secretary of State was asked—

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

1. What assessment he has made of the potential effects of Scottish independence on border parliamentary constituencies.

[The Secretary of State for Scotland (Mr Alistair Carmichael)]

As a United Kingdom, we all have better job opportunities, employment and mobility. Every day, 30,000 people travel between Scotland and England for work. If Scotland were to leave the United Kingdom, our border constituencies would be the first to feel the effects of the creation of an international border.

[Rory Stewart]

Does the Secretary of State agree that one of the challenges of separation would be that our focus would be lost and our energy dissipated by looking at the details of administration and borders, rather than all the opportunities in the world, from Brazil to Indonesia?

[Mr Carmichael]

That is one of the many downsides a vote for independence would bring. It would be an unnecessary distraction that would indeed remove our focus from the opportunities that being part of the United Kingdom give us to develop Scottish business by looking overseas.

[Mr Brian H. Donohoe (Central Ayrshire) (Lab)]

On the question of separation, surely it is understood that divorce can be messy and that in this case it certainly would be messy? What I have been told by businessmen in my area is that they will move out of Scotland if separation takes place.

[Mr Carmichael]

I think we all know that what matters to business is the bottom line: the profit and loss account and the balance sheet. If businesses felt that independence was going to be good for them, they would be lining up to support it. Since the turn of the new year, we have heard a steady chorus from the business community, who have all been coming out to underline the risks and uncertainty that would come from independence. [Interruption.] These are voices that the hon. Members on the nationalist Benches may wish to drown out with their incessant chatter, but they will not do it.

[Michael Moore (Berwickshire, Roxburgh and Selkirk) (LD)]

Anybody who pauses at the top of the hill on the Carter Bar on the A68 is able to reflect on one of the most beautiful views of Scotland and on one of the most beautiful views of England, and reflect on the fact that these two countries have so much in common and so much shared family experience. Does my right hon. Friend share my hope that that will always be the case, rather than it marking the border point between two separate states?

[Mr Carmichael]

I very much agree with my right hon. Friend. I always think of the United Kingdom as being a family of nations. Of course, like all families, we do have those moments where we have disagreements, and we do occasionally want to do things in a slightly different way, but as a family the ties that bind us are so much greater than the differences that divide us. That is why I believe that Scotland, come 18 September, will choose to remain part of that family of UK nations.

[Angus Robertson (Moray) (SNP)]

But the people of the borders and the rest of Scotland are being subjected to the self-styled “project fear” campaign, which its own supporters describe as negative, nasty, and threatening, and who also say that the Prime Minister is toxic in Scotland. Why are even the Secretary of State’s own colleagues saying this?

[Mr Carmichael]

I have to say that it is a bit rich to hear the right hon. Gentleman talking about “project fear” when the First Minister went to Carlisle on St George’s day to deliver a lecture that I can only describe as project ridiculous. The fact of the matter—there is no escaping this for the nationalists—is that for people living in the constituencies on either side of the border, there are real benefits to being part of the United Kingdom. The nationalists want us to walk away from those benefits.

[Angus Robertson]

Leading members of the right hon. Gentleman’s own campaign have told people in the borders and the rest of Scotland that they will have to show a passport at the border; drive on the right-hand side of the road; worry about their pensions, when in this place people are being told that they are safe; and that they will not be able to use their own currency, when the media in London are being briefed that that will be safe. Why do his colleagues think that the people of the borders and the rest of Scotland will fall for this demeaning, insulting nonsense?

[Mr Carmichael]

The question of the borders highlights perfectly how the Scottish nationalists want to have their cake and eat it. On the one hand, they tell us that we could have a common travel area, which works very well with the Republic of Ireland at present. At the same time, they tell us that we will have a widely divergent immigration policy, which the Republic of Ireland does not have. They can have one thing or the other: they cannot have both. That is why their prospectus is flawed.

[John Stevenson (Carlisle) (Con)]

In places such as Carlisle, many businesses have branches and offices on both sides of the border. Does the Secretary of State agree that if Scotland votes yes there is a real danger that there will be such an additional burden on those businesses that it will have an effect on jobs and economic prosperity on both sides of the border?

[Mr Carmichael]

Inevitably, an independent Scotland would have a different taxation system, different national insurance provisions and different economic regulations, and that would impose an extra cost on business. The financial services sector, which supports 200,000 jobs in Scotland, has already issued serious warnings about what would happen to its business and how it would organise itself if Scotland became independent.

[Katy Clark (North Ayrshire and Arran) (Lab)]

2. What discussions he has had with his ministerial colleagues on the effects of housing benefit changes in Scotland.

[Sandra Osborne (Ayr, Carrick and Cumnock) (Lab)]

9. What discussions he has had with his ministerial colleagues on the effects of housing benefit changes in Scotland.

[The Parliamentary Under-Secretary of State for Scotland (David Mundell)]

I have had regular discussions with ministerial colleagues about the effect of housing benefit changes in Scotland, and in particular about the application of discretionary housing payments to those affected by the removal of the spare-room subsidy. Those discussions led to the announcement on Friday 2 May that the setting of the limit for such payments could become the responsibility of the Scottish Government.

[Katy Clark]

In February the Scottish Parliament voted in favour of full mitigation of the bedroom tax, but much of that money has not yet reached tenants. Given that there has been a discussion about the discretionary cap, does the Minister agree that the Scottish Government could have acted earlier, and, given that an announcement has now been made, will he do everything in his power to ensure that there is co-operation between Westminster and the Scottish Government so that the money reaches the people who need it?

[David Mundell]

I entirely agree with the hon. Lady. The Scottish Government already had powers that they could have used to take other steps for the purpose of the mitigation that they said was necessary, but they chose not to do so. The Scottish Parliament forced additional funds to be provided, and we will not stand in the way of the spending of those funds. I shall be meeting the Deputy First Minister of Scotland tomorrow morning, and I shall convey the hon. Lady’s comments to her.

[Sandra Osborne]

Does the Minister agree with the far-reaching proposals of Scottish Labour’s devolution commission, including the proposal for the devolution of housing benefit? Does he agree that that would be a progressive, logical and practical step that would enhance devolution and the ability to meet Scottish housing needs?

[David Mundell]

I think that the proposal to devolve the setting of the cap for discretionary housing payments is a positive step, and I welcome the fact that the Labour party has presented proposals. At the end of May, the Scottish Conservative party will present its proposals following the outcome of the work of our own devolution commission.

[Mary Macleod (Brentford and Isleworth) (Con)]

An important part of dealing with housing benefit is ensuring that there is enough affordable housing. Does my right hon. Friend agree that the lack of suitable affordable housing in Scotland is the result and the responsibility of successive Scottish Governments?

[David Mundell]

I do agree with my hon. Friend. She will be aware that since 2010 the Scottish Government have had an additional £1.3 billion in funding that they could have used to provide affordable housing in Scotland. We used to hear constantly in the Chamber about the number of shovel-ready projects in Scotland, but we have not seen much shovelling.

[Dr Eilidh Whiteford (Banff and Buchan) (SNP)]

The bedroom tax has been a costly fiasco in Scotland. It should never have happened, but I am glad that the Government have at long last agreed to allow the Scottish Government to mitigate its worst impacts. However, the Secretary of State recently boasted that we have a “fantastic” benefits system. Does the Minister think that he was talking about the bedroom tax, or is he also living in a parallel universe?

[David Mundell]

I certainly do not live in the universe that the SNP inhabits. It has not given us a single detail of how a welfare system would operate in Scotland. Indeed, in the 670 pages of the Scottish Government’s White Paper, there is just one reference to the establishment of such a system. The SNP set up a commission, but we have heard nothing from it, so I am afraid that I shall take no lessons from the hon. Lady.

[Mr Ian Davidson (Glasgow South West) (Lab/Co-op)]

Does the Minister accept that, now that the Scottish Government have been given the powers for which they asked in relation to discretionary housing payments, there is no reason why they should not first cancel all the bedroom tax for this year, and then write off all the debts that were incurred last year? In order to ensure that no moral hazard is involved, should they not do as the Scottish Affairs Committee has asked, and refund the money that Scottish people paid last year in bedroom tax?

[David Mundell]

I understand that a statement is to be made about the matter in the Scottish Parliament today, and I am sure that the hon. Gentleman’s colleagues will raise those very points with the Scottish Government.

[John Robertson (Glasgow North West) (Lab)]

3. What assessment he has made of the effects of recent trends in household energy bills on standards of living in Scotland; and if he will make a statement.

[The Parliamentary Under-Secretary of State for Scotland (David Mundell)]

Rising energy bills are a serious concern for consumers in Scotland and across the rest of the UK. We are increasing competition, sustaining vital financial support for vulnerable consumers, and working to ensure suppliers put customers on the cheapest tariff.

[John Robertson]

I thank the Minister for his answer. Does he agree that with the closing of coal-fired power stations and a doctrine of anti-nuclear power stations north of the border, under independence, with the reliance on renewables, energy costs must increase?

[David Mundell]

I certainly agree with the hon. Gentleman about the serious loss to the Scottish economy of closing the door on the nuclear industry, which has brought so much benefit to Scotland, and I pay tribute to him for being such a champion of that cause. He is right that energy costs will go up in an independent Scotland, as set out in the Government’s analysis on energy.

[Guy Opperman (Hexham) (Con)]

Both in Northumberland and in Scotland people are setting up oil-buying clubs to deal with the problem of off-grid energy. Does the Minister agree that the best way to combat energy problems and price rises in off-grid circumstances is to copy this good measure and spread it out across the country?

[David Mundell]

I absolutely agree with my hon. Friend. Oil clubs are developing in Scotland and the Government are keen to promote and support them. I commend him for highlighting this issue.

[Mr Mike Weir (Angus) (SNP)]

11. If the Minister is genuinely concerned about rising costs of energy in Scotland, why is it that Ofgem has yet again delayed the implementation of Project TransmiT, which would finally begin to tackle the discriminatory and expensive transmission charges? Will he press his colleagues to implement it immediately?

[David Mundell]

Project TransmiT is one matter on which I am probably in agreement with the hon. Gentleman. The important thing for Scotland is to get the right answer. Yes, it is disappointing that it has taken some time, but the Scotland Office is determined to work towards getting the right answer, and I urge him and his colleagues to continue to press Ofgem on this as well.

[Margaret Curran (Glasgow East) (Lab)]

Will the Secretary of State explain why, when the Prime Minister said that consumers in Scotland would be £50 better off after cuts to the green levies, hundreds of thousands of Scottish consumers have seen their bills decrease by only £12?

[David Mundell]

There is no reason why consumers in Scotland should not be seeing this £50 benefit, and the Government will continue to do all we can to make sure that they do.

[Margaret Curran]

That is the definition of an inadequate answer, and perhaps goes some way towards explaining why Labour’s policy has gained widespread support across Scotland. In opposing Labour’s energy freeze, the Tory-led Government have had the full support of a surprise friend in the form of the Scottish National party, and it does not stop there: standing up for energy companies, failing to take action on the living wage, proposing tax cuts for those at the top. Does the Minister not agree that Scotland deserves better than this?

[David Mundell]

What I believe is that we do not take any lectures from Labour on energy issues. Gas bills more than doubled under Labour, electricity bills went up by 50%, the leader of the Labour party was responsible for £179 of additional levies on gas bills and fuel duty went up 12 times. I am proud of this Government’s record on energy and Scotland is doing well under it.

[David Mowat (Warrington South) (Con)]

4. What discussions he has had with Ministers in the Scottish Government on the potential role of the Bank of England in the event of Scotland becoming an independent country.

[The Secretary of State for Scotland (Mr Alistair Carmichael)]

I have not had any discussions with Ministers in the Scottish Government on the potential role of the Bank of England. If people in Scotland vote to leave the UK, they are voting to leave the UK institutions that support it, such as the Bank of England, which will continue to operate on behalf of the continuing UK.

[David Mowat]

I thank the Secretary of State for that answer. The majority of my constituents hope very much that Scotland will stay in the Union, but for the avoidance of doubt, will he confirm that in the event of a yes vote, there are no circumstances under which my constituents will underwrite the borrowing and spending plans of an independent Scotland, whichever currency it uses?

[Mr Carmichael]

I thank my hon. Friend for his support for the continuation of Scotland within the United Kingdom. The position on any currency union or central banking arrangements if Scotland were to vote for independence has been made very clear recently by the Chancellor and the Chief Secretary and also by the shadow Chancellor: there will be no such arrangements.

[Ian Murray (Edinburgh South) (Lab)]

In the event of an independent Scotland, will the Bank of England’s Monetary Policy Committee take its instructions from the UK Treasury or the Scottish Government?

[Mr Carmichael]

The Bank of England will continue to take its instructions from the UK Treasury. It is a UK institution and that would not change.

[Mr Philip Hollobone (Kettering) (Con)]

If Scotland separated from the United Kingdom, how would the UK’s foreign exchange reserves be reallocated?

[Mr Carmichael]

That would be a matter to be determined in the event of Scotland voting to leave the United Kingdom. I very much hope that will not come to pass.

[Stewart Hosie (Dundee East) (SNP)]

The Bank of England has already sensibly engaged in technical discussions with the Scottish Government. As each day passes and a yes vote on independence becomes more likely, is it not about time this Government abandoned their bellicose scaremongering and also engaged in sensible discussions with the Scottish Government on how these institutions can continue to work, in the best interests of both countries?

[Mr Carmichael]

Both Governments agreed in the Edinburgh agreement that there would be no question of pre-negotiation. That was a sensible situation and I am astonished that the hon. Gentleman now seeks to walk away from it.

[Sir Malcolm Bruce (Gordon) (LD)]

Does the Secretary of State agree that the Bank of England is not an asset to be shared but an institution that belongs to the United Kingdom which Scotland chooses to leave? Does he also agree that it is an extraordinary kind of independence where one wants to hand over control of one’s fiscal and monetary policy to a foreign bank?

[Mr Carmichael]

My right hon. Friend puts it perfectly. The difference between an asset and an institution is not a difficult one to understand, but the Scottish nationalists do seem to struggle with it.

[Michael Connarty (Linlithgow and East Falkirk) (Lab)]

5. What discussions he has had with Ministers in the Scottish Government on a potential currency union with an independent Scotland.

[The Secretary of State for Scotland (Mr Alistair Carmichael)]

I have not had any discussions with the Scottish Government about the prospect of a currency union. The Chancellor, Chief Secretary and shadow Chancellor have all said there will not be a currency union. The only way to keep the UK pound is to stay in the UK.

[Michael Connarty]

I thank the Secretary of State for that reply. Having read the fiscal commission’s report, it is clear that it took the advice that I have been giving Scottish National party colleagues here that they would be destroyed if they went into the eurozone, where the stability and growth pact would destroy their economy. If they have no currency union with the UK, exactly what prospects are there for the 8% deficit that Scotland is running at the moment?

[Mr Carmichael]

The position is very clearly laid out: the difficulties that would be created by the currency union would be difficulties for the whole of the United Kingdom, but particularly for the people of Scotland. If we are to be independent, we need to be independent with all that that means. It is not possible to be half independent.

[Michael Fabricant (Lichfield) (Con)]

Is my right hon. Friend aware that Moody’s has stated that if Scotland were to gain its independence it would downgrade Scotland’s credit rating to B? What effect would that have on Scotland’s interest rates?

[Mr Carmichael]

The comments and report by Moody’s last week have to be taken very seriously and read with some care. Moody’s makes it clear that on its estimation an independent Scotland would be rated two levels below the rating the UK currently enjoys. For the people of Scotland that would mean more expensive store cards, more expensive overdrafts and more expensive mortgages. We are cheaper as part of the United Kingdom.

[Gemma Doyle (West Dunbartonshire) (Lab/Co-op)]

12. Does the Secretary of State agree that all the currency options that have been put forward for an independent Scotland by the nationalists would actually involve constraints on decision making on fiscal policy?

[Mr Carmichael]

Every option that is put forward by the Scottish nationalists is inferior to what we currently have as part of the United Kingdom. That is the unpalatable truth that they do not want to hear, but from which there is no escaping. The people of Scotland know that truth.

[Mr Alan Reid (Argyll and Bute) (LD)]

The success of the Government’s economic policy is proven by the fact that the number of people claiming unemployment benefit in my constituency reduced by 419 in the past year. Does my right hon. Friend agree that the best way to keep this sustained economic growth is to stay within the UK and with the common currency that we have at the moment?

[Mr Carmichael]

Indeed. My hon. Friend gives me an opportunity to remind the House that the United Kingdom has the fastest growing economy in the G7, and that Scotland is the second wealthiest part of that economy.

[Mr Michael McCann (East Kilbride, Strathaven and Lesmahagow) (Lab)]

10. The people of Scotland want facts, so will the Secretary of State tell us on what date, if Scotland chooses to separate, will it either have to begin printing its own money or, failing that, start using the pound as a foreign currency?

[Mr Carmichael]

The hon. Gentleman invites me to look into the future and make a prediction, which is never an easy prospect—it is an unwise prospect for anyone in politics. The truth of the matter is that all these things are uncertain, and they bring enormous risks in areas where we do very well as a result of being part of the United Kingdom.

[Sir Menzies Campbell (North East Fife) (LD)]

To echo the hon. Member for Moray (Angus Robertson), what could be more demeaning and insulting than to lead the Scottish people to believe that there are no risks in independence, and that a currency union is a foregone conclusion?

[Mr Carmichael]

The only foregone conclusion about a currency union is that it will not happen. It will not happen because that is the advice that has been given by the permanent secretary to the Chancellor of the Exchequer. That advice is not going to change, and the outcome of that advice is not going to change.

[Pete Wishart (Perth and North Perthshire) (SNP)]

The Chancellor’s sermon on the pound was supposed to bring the Scottish people back into fearful line, but as the opinion polls have shown, the Scottish people will not be discouraged by this; instead, they are emboldened and angered. The Scottish people will no longer be told by Westminster. Will the Secretary of State tell us what has happened to the search for the Minister who told the truth? Have they made any progress, or do they perhaps need our help?

[Mr Carmichael]

Mr Speaker, I am delighted that you were able to fit the hon. Gentleman in; otherwise, we would all have missed his monthly comedy turn. It is quite remarkable that he chooses to ignore the advice given by the permanent secretary to the Chancellor of the Exchequer, setting out why a currency union would be bad for the rest of the United Kingdom and bad for an independent Scotland. Why does the hon. Gentleman want something that would be bad for Scotland?

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

Last week, 18% of members of Scottish Chambers of Commerce confirmed that they are making plans to move out of Scotland in the event of a yes vote, and 63% believe that an independent currency or the euro would be bad for business. Today we have heard from the British Chambers of Commerce that 85% of their businesses are against independence, and nearly half identified currency concerns as the most important issue for them. What reassurances can the Secretary of State give the House about currency for businesses on both sides of the border?

[Mr Carmichael]

The only reassurance I can give is that if people in Scotland vote no, they will continue to enjoy the use of the pound and they will continue to have the Bank of England as a lender of last resort. Beyond that, everything is uncertain.

[Iain Stewart (Milton Keynes South) (Con)]

6. What assessment he has made of the potential effects of Scottish independence on cross-border trade and employment.

[The Secretary of State for Scotland (Mr Alistair Carmichael)]

Scotland’s place in the United Kingdom means we have a truly single domestic market, with no barriers to trade and employment across the United Kingdom. Independence would fundamentally change that. The resulting “border effect” would disrupt trade and free movement of workers, reducing real incomes by, it is estimated, around £2,000 per Scottish household per year.

[Iain Stewart]

My constituency is home to a large number of national logistics and distribution companies. Is my right hon. Friend aware of the growing concern in that sector that separation could make some cross-border routes less attractive, as they would become international rather than domestic ones?

[Mr Carmichael]

Indeed, and I hear the same message from a range of business interests. The financial services industry, for example, says that independence would bring extra costs with different taxation and different regulation. The supermarkets have made it very clear that extra costs would fall to Scottish consumers if Scotland were independent.

[Mr Angus Brendan MacNeil (Na h-Eileanan an Iar) (SNP)]

According to the House of Commons Library, 200,000 UK jobs depend on trade with the Republic of Ireland—double that of Canada and Norway. Ireland used to be part of the UK, but trade between the two has never been higher. The UK is Ireland’s No. 1 trading partner, and among the recently independent nations of the European Union, foreign direct investment rose by 215% in the first four years of independence. For those realities, what scare stories will the Secretary of State use?

[Mr Carmichael]

It is not a scare story to point out that the White Paper presents a prospectus and a future where there would be barriers and where the mere existence of a border would be an extra cost. If the hon. Gentleman wants to know the truth of the matter, he need look no further than at the situation that exists between Canada and the United States. The hon. Gentleman might not like it, but that is the truth.

[Graeme Morrice (Livingston) (Lab)]

What discussions has the Secretary of State had with the Scottish Government regarding the possibility of border controls between an independent Scotland and the rest of the UK, if an independent Scotland had a separate immigration policy?

[Mr Carmichael]

It is an inescapable fact that if, as the nationalists tell us in the White Paper, Scotland were to have a widely divergent immigration policy, which would be necessary for such of their economic plans as they have been prepared to tell us about, the operation of a common travel area of the sort that currently works well with the Republic of Ireland simply would not operate. You cannot have your cake and eat it on this occasion.

[Mr Speaker]

Last but not least, Mrs Anne McGuire.

[Mrs Anne McGuire (Stirling) (Lab)]

Given the First Minister’s threat to blockade Scottish fishing grounds if he does not get his own way on EU membership and given that licences are held across the United Kingdom, what analysis has the Secretary of State done on the impact on employment in the Scottish fishing industry?

[Mr Carmichael]

The impact on employment would be serious in some of the most economically fragile communities in Scotland in our coastal and island communities. I have to say that the First Minister’s comment about blockading Scottish waters went beyond the ridiculous, but it makes me wonder whether that is why he seems so desperate to cosy up to Vladimir Putin.

The Prime Minister was asked—

[Mel Stride (Central Devon) (Con)]

Q1. If he will list his official engagements for Wednesday 7 May.

[The Prime Minister (Mr David Cameron)]

This morning I had meetings with ministerial colleagues and others, and in addition to my duties in this House, I shall have further such meetings later today.

[Mel Stride]

As the proud father of three daughters, I am sure that the entire House will share my deep concern for the more than 270 Nigerian schoolgirls held captive in that country. Their only so-called crime is that they aspired to receive an education. Will my right hon. Friend set out for the House the steps that the Government are taking to ensure that we help to secure their release as soon as possible?

[The Prime Minister]

I know that my hon. Friend speaks for the whole House—and, indeed, the whole country. I am the father of two young daughters, and my reaction is exactly the same as my hon. Friend’s and of every father and mother in this land and in the world: this is an act of pure evil, which has united people across the planet to stand with Nigeria to help find these children and return them to their parents.

The Foreign Secretary and the British Government have made repeated offers of help to the Nigerian Government since the girls were seized. I shall be speaking to the Nigerian President this afternoon and will say again that Britain stands ready to provide any assistance, working closely with the US, as immediately as we can. We already have a British military training team in Nigeria, and the Foreign Office has counter-terrorism experts. We should be proud of the role we play in that country where British aid helps to educate 800,000 Nigerian children, including 600,000 girls. We should be clear that this is not just a Nigerian issue: it is a global issue. There are extreme Islamists around the world who are against education, against progress and against equality—and we must fight them and take them on wherever they are.

[Edward Miliband (Doncaster North) (Lab)]

Let me begin by fully associating myself and the Opposition with the Prime Minister’s remarks on the terrible situation in Nigeria.

On our proposal for three-year tenancies in the private sector, will the Prime Minister tell us when he expects to make the inevitable journey from saying that they represent dangerous Venezuelan-style thinking to saying that they are actually quite a good idea?

[The Prime Minister]

I have not had the time to study the rent control proposals, but I am sure the right hon. Gentleman will be able to lay them out for the House. Let me be clear about my view. If there is an opportunity to find longer-term tenancy agreements to give greater stability—a proposal made at last year’s Conservative conference—I am sure we can work together. If, however, the proposal is for rent controls that have been tried all over the world, including in Britain, and have been shown to fail, I think it would be a very bad idea.

[Edward Miliband]

Even by the right hon. Gentleman’s standards, this is a pretty quick U-turn. Last week, the chairman of the Conservative party—I know the right hon. Gentleman does not have a briefing on this, but perhaps he can listen to the question—was saying this was all back to Venezuela and that it is completely wrong, but the Community Secretary has supported these proposals. The question is how are we going to make it happen?

[The Prime Minister]

Actually, I have got some very good briefing on these proposals—from Labour MPs. Here they are. Let us start with Labour’s Housing Minister. You would think she would support Labour’s policy. She says:

“I do not think it will work in practice”.

The shadow Secretary of State for Communities and Local Government says this:

“We don’t want to return to rent controls because the rental sector is meeting a demand for housing.”

There we are—the authentic voice of Bennism.

Then we come to the Chairman of the Communities and Local Government Committee, a Labour MP, the hon. Member for Sheffield South East (Mr Betts). He said this:

“We concluded that rent control was not feasible.”

So there we have a Labour policy, completely unclear about what it is; but the one thing that is clear is that Labour MPs do not back it.

[Edward Miliband]

All the right hon. Gentleman shows is that he has nothing—[Interruption.]

[Mr Speaker]

Order. I know it has to be said every week, but I will very happily say it again. However long it takes—a very simple exercise in democracy; the lesson should be learned—the question will be heard and the answer will be heard. It is incredibly simple.

[Edward Miliband]

All the right hon. Gentleman shows is that he has no idea about this incredibly important issue facing our country. Let me explain it to him. There are 9 million people renting in this country. Our proposal is that there should be fixed three-year tenancies as the norm for those people with predictable rent changes. Right? That is the proposal. Many people across this country think that for the first time this is a party addressing the issue they face, so will he explain what is wrong with going from one-year tenancies with unpredictable rent rises to three-year tenancies with predictable rents? Why has the Conservative party given up on millions of people who are Generation Rent.

[The Prime Minister]

We want to build more houses so we have a better rental sector with more affordable rents. But as I said in my very first answer, if this is about finding new tenancies that give long-term security on a voluntary basis, yes. If it is about mandating rent controls from the centre and destroying the housing market, no. The problem I have with so many of the right hon. Gentleman’s policies is that they all come from the same place—

[Steve Brine (Winchester) (Con)]

Len.

[The Prime Minister]

Thank you very much. Len—they come from the Unite union. Unite said, “Renationalise the railways.” The right hon. Gentleman wants to renationalise the railways. Unite says, “Let’s have old-style rent controls.” He wants old-style rent controls. The problem with rent controls is their policies are for rent, their candidates are for rent and their leader is for rent. That is the problem.

[Nigel Adams (Selby and Ainsty) (Con)]

The Prime Minister will be as encouraged as I am that unemployment in my constituency is down by almost a third since the last election. However, the future for almost 1,000 workers related to Eggborough power station in my constituency is less certain. Will he meet me to ensure that we have a future for this very important asset in my constituency?

[The Prime Minister]

I am very happy to meet my hon. Friend to discuss this. What he says about the fall in unemployment, which we are now seeing right across our country, is welcome. In fact, employment is growing fastest not in the south-east but in Wales, which shows that the recovery is increasingly more broadly based. I know about the problems at Eggborough power station, and the demand there for further action, as has been agreed at Drax. I am very happy to discuss that with him and see what can be done.

[Mr Andy Slaughter (Hammersmith) (Lab)]

Q2. I have two world-class hospitals in my constituency. The Secretary of State for Health has decided that Hammersmith will lose its A and E this year and Charing Cross will be demolished, losing all consultant emergency services, including A and E, and the country’s best stroke unit. Will the Prime Minister stop his Health Secretary putting my constituents’ lives at risk?

[The Prime Minister]

What we are doing in north-west London is ensuring that the NHS gets more money. It will be getting £2.4 billion this year—£74 million more than the year before. Let us remember that his own party’s policy was to cut the NHS, as is happening now in Wales. The changes that are being made in north-west London are backed by clinicians and local people. We want to see our NHS improve, as it is under this Government.

[Sir Tony Baldry (Banbury) (Con)]

Does my right hon. Friend agree that the policies of the UK Independence party are based on fear—fear of the world and fear of foreigners? As a great trading nation, we should embrace the world. If anyone comes to my constituency and goes to the hospital, the nursing homes, the farms or the building sites, they will see the great contribution that is being made to our communities and to the growth of our economy by fellow EU citizens.

[The Prime Minister]

My right hon. Friend is absolutely right that Britain has benefited from being an economy that is open to investment and open to people coming who want to contribute and work hard here. I agree with what he says about UKIP: so much of its view seems to be that we do not have a bright future in this country. I absolutely believe that we do. If we get our deficit down and our economy growing and we invest in apprenticeships, we will show that we can be one of the success stories of the 21st century. We are making progress and that is the way to challenge its world view.

[Edward Miliband]

There is deep concern in the British business and scientific communities about the proposed takeover of AstraZeneca by Pfizer. The deal would have an impact for decades to come on British jobs, British investment, British exports and British science. The Business Secretary said yesterday that he is “not ruling out intervention”. What type of intervention is under consideration by Government?

[The Prime Minister]

I absolutely agree with what the Business Secretary said yesterday, but let me be clear that the most important intervention we can make is to back British jobs, British science, British research and development, British medicines and British technology. That is why I asked the Cabinet Secretary and my Ministers to engage with both companies right from the start of this process, and I make no apology for that, because we know what happens when you do not engage. If you stand back and just say you are opposed to everything, you get abject surrender and no guarantees for Britain. We are fighting for British science, and it is a pity that the right hon. Gentleman is trying to play politics rather than backing the national interest.

[Edward Miliband]

It is good to hear that the right hon. Gentleman agrees with the Business Secretary. The Business Secretary said this:

“One of the Government’s options would be to consider using our public interest test powers.”—[Official Report, 6 May 2014; Vol. 580, c. 23.]

There needs to be a proper assessment of this bid, and yesterday the Business Secretary said that he was open to doing that. It could be done straight away, through this House, and we on the Labour Benches would support making that happen. Will the Prime Minister agree to do it?

[The Prime Minister]

The assessment that I want is from the Business Department on this deal or indeed, because there is not now an actual offer on the table, any subsequent offer. I will judge all these things on whether they expand British jobs, British investment and British science. Let me just make this point, because I worry that it may be lost in this debate. We all know that the right hon. Gentleman thinks he is extremely clever—we all know that—but he may have missed this point. Britain benefits massively from being open to investment. Nissan is now producing more cars than the whole of Italy. Jaguar Land Rover, under Indian ownership, has created 9,000 jobs in the west midlands since I became Prime Minister. Vodafone and indeed AstraZeneca have benefited from that backing of an open country to go out and build and buy businesses around the world. There is more inward investment in Britain today than the rest of the EU combined. Let us not put that at risk.

[Edward Miliband]

The right hon. Gentleman does not understand. This is simply about something very straightforward—having an independent assessment of this bid and whether it is in the national interest. I will ask him the question again as it matters to people right across this country. Is he ruling out, or ruling in, using the public interest test on this takeover? We could make it happen. His Business Secretary could make it happen, and we would support it. If he does not take action now, and the bid goes through without a proper assessment, everyone will know that he was cheerleading for this bid, not championing British science and British industry.

[The Prime Minister]

I think it is deeply sad that the Leader of the Opposition makes accusations about cheerleading when the Government were getting stuck in to help British science, British investment and British jobs. Does it not tell us everything that, given the choice of doing the right thing for the national interest and working with the Government or making short-term political points, that is what he chooses to do? We might ask why the public interest test was changed in the first place. It happened when they were sitting in the Treasury. Yes, they wrote the rules, they sold the gold and they saw manufacturing in our country decline by one half. We will never take lectures from the people who wrecked our economy.

[Dr Julian Lewis (New Forest East) (Con)]

Will the Prime Minister confirm that under his leadership this country will never spend less than the NATO recommended minimum of 2% of GDP on defence?

[The Prime Minister]

We are spending in excess of 2% and we are one of the only countries in Europe to do that. The Greeks, I believe, are spending more than 2% but, if I can put it this way, not all on things that are useful for all of NATO. We should continue to make sure we fulfil all our commitments on defence spending.

[Joan Walley (Stoke-on-Trent North) (Lab)]

Q3. Will the Prime Minister urgently meet again with me and fellow MPs to find a way forward on consultant-led maternity services to be run by the university hospital in Stoke-on-Trent?

[The Prime Minister]

The hon. Lady has asked me this question in the past. I was keen to ensure that despite all the difficulties at the Mid-Staffordshire hospital there was an opportunity to see whether it might be possible for the long term to have consultant-led maternity services. People who live in our major towns, such as Stafford, want to be able to have their babies locally. It is vital that we do that and I am regularly updated by my hon. Friend the Member for Stafford (Jeremy Lefroy). I would be happy to meet him and a delegation of Staffordshire MPs if it is necessary to talk further about this point.

[Margot James (Stourbridge) (Con)]

Q4. Last week, Boston Consulting Group published research that found that Britain is the No. 1 competitive manufacturing country in the whole of western Europe and number four globally behind China, the United States and South Korea. Does my right hon. Friend agree that that is just the sort of company we should be keeping and further evidence that our strategy to rebalance the UK economy towards manufacturing and the west midlands and other regions is working?

[The Prime Minister]

I am grateful to my hon. Friend for what she says, because for the first time in almost a decade all three main sectors of the economy—manufacturing, services and construction—have grown by at least 3% over the past year. That is further evidence that the economic plan is working. Manufacturing is important in itself and it is also important because so much of it is tradeable. We want to see Britain export more, make more and invest more. The moves made by my right hon. Friend the Chancellor in the Budget in terms of investment allowances and backing UK Trade & Investment are dedicated to that angle. As I said earlier, we must also remain an open economy, which will encourage people to invest in our manufacturing base.

[Mr Nigel Dodds (Belfast North) (DUP)]

Later this week, the opening stages of the Giro d’Italia will take place in Northern Ireland. The Tour de France is also coming to Yorkshire. Such world-class sporting events allow us to showcase our region, boost tourism and grow the local economy. Does the Prime Minister agree that as we seek to build a more prosperous and better future for all our people in Northern Ireland it is vital that the suffering and hurt of the victims is never forgotten and that whether it happened one year ago, 10 years ago or 42 years ago, justice must be pursued and the police must be allowed to follow the evidence wherever it may lead?

[The Prime Minister]

First, I agree with the right hon. Gentleman about the importance of these great sporting events—both the one he mentioned in Northern Ireland and, of course, the Tour de France, which will be starting in Leeds. That will be a great moment for Yorkshire and for the whole United Kingdom. We should do all we can to promote these events, although we should perhaps draw the line at appearing in lycra at either of them.

The right hon. Gentleman raises a very important issue about terrorist victims. We discussed recently the important issue of trying to ensure greater assistance from Libya over Semtex that is still being found in Northern Ireland as we speak today. As for his other remarks, we should be proud of the fact that a free country has an independent judiciary, an independent legal system and an independent police service and that they decide who to arrest, who to question and who to charge. That is how it must remain.

[Paul Burstow (Sutton and Cheam) (LD)]

Q5. Dementia is one of the biggest challenges facing our country. Will the Prime Minister join me in congratulating the Alzheimer’s Society and Public Health England on launching a major new campaign through Dementia Friends to raise awareness and to challenge stigma? Given that 50,000 people quit their jobs to care for people with dementia, will he ensure that there is a new dementia strategy at the end of this year—the current one ends this year—so that we can ensure that people with dementia receive the support they need?

[The Prime Minister]

I pay tribute to my right hon. Friend for raising this issue. We have turned the zero on No. 10 into the dementia flower today to help to boost the importance of raising awareness of this issue and of encouraging more people to train as Dementia Friends. I will look at what he says about the strategy. As he knows, it is about investing in research and science, where we have doubled the budget for dementia. It is about dementia-friendly communities and also making sure that our hospitals and care homes treat people with dementia better. We will carry forward all those, and I will perhaps write to him about the update to the strategy.

[Ann Clwyd (Cynon Valley) (Lab)]

Some 100,000 people are already dead in Syria and others are dying while we are here today. They need help desperately. We have talked about humanitarian help, but we have not crossed borders. What on earth are we doing about it?

[The Prime Minister]

The right hon. Lady is right to raise this. The answer to what are we doing about it is that Britain is the second largest bilateral aid donor in terms of humanitarian aid going into Syria, so we are helping to feed, clothe and house people in Turkey, in Lebanon, in Jordan and elsewhere. She raises the important point about getting aid into Syria. More is being done on that, but it is extremely difficult because of the security situation. We will continue to do what we can.

[Andrew Griffiths (Burton) (Con)]

Q6. As we mark the centenary of the first world war, it is a national disgrace that the graves of Victoria Cross winners lie crumbling and derelict. As a patron of the Victoria Cross Trust, may I congratulate the Prime Minister and the Secretary of State for Communities and Local Government on pledging £100,000 to help to restore some of those graves, and The Sun on highlighting this campaign? As the Government have pledged to match-fund every penny raised by the Victoria Cross Trust, will the Prime Minister join me in urging people to go online, to donate and to ensure that we have fitting memorials for the bravest of the brave.

[The Prime Minister]

I certainly join my hon. Friend, who is a patron of the Victoria Cross Trust, for the hard work that is being done. The Sun did a good job in highlighting the importance of this issue. As my hon. Friend mentioned, my right hon. Friend the Secretary of State for Communities and Local Government has announced £100,000 of funding for the Victoria Cross Trust. This should go to restoring the graves of Victoria Cross recipients.

We also have a programme for letting local authorities put down paving stones for people who won Victoria Crosses in their area, and we are looking at many other ways to commemorate this absolutely vital anniversary. The most important thing we are doing is the huge multimillion pound investment going to the Imperial War museum, which is opening this summer and to which I take my children. It brings the first world war to life in an extraordinary way, and that is at the heart of our important commemorations.

[Mrs Emma Lewell-Buck (South Shields) (Lab)]

Q15. My constituent Darren Lugg’s disability means that he needs a specially adapted bed. He therefore cannot share a room with his wife, but still they are hit by the bedroom tax. Can the Prime Minister explain why this Government are punishing him for his disability?

[The Prime Minister]

As the hon. Lady knows, we have discretionary housing payments for exactly this sort of case, and the money has been topped up, so there is no reason for people to be disadvantaged in the way she suggests.

[David Rutley (Macclesfield) (Con)]

Q7. AstraZeneca is Macclesfield’s largest employer with 2,000 employees, so I share constituents’ concerns about Pfizer’s proposed bid. I welcome the steps taken by the Government to secure initial commitments from the company if it succeeds. Can the Prime Minister tell the House what further steps are being taken to strengthen those commitments and to safeguard highly skilled manufacturing jobs in Macclesfield?

[The Prime Minister]

I am grateful for my hon. Friend’s remarks. There are 2,000 people employed by AstraZeneca in his constituency, and he is quite right to speak up for them. Our entire approach is based on trying to secure the best possible deal in terms of jobs, investment and science, and that is why I believe it was absolutely right to ask the Cabinet Secretary to engage with Pfizer, just as we are engaging with AstraZeneca. I find it extraordinary that we have been criticised for this. Of course, there is no offer on the table, but the commitments that have been made so far are encouraging in terms of completing the Cambridge campus and making sure that 20% of the combined companies’ total research and development work force is in the UK going forward—and they specifically mention substantial commercial manufacturing facilities in Macclesfield. The company also goes on to say that because of the patent box that we have introduced, it would look at manufacturing more in the UK. But let me absolutely clear: I am not satisfied; I want more, but the way to get more is to engage, not to stand up and play party politics.

[Mr Kevan Jones (North Durham) (Lab)]

On a number of occasions the Prime Minister has raised the important issue of awareness of mental health, and I thank him for that, but can he explain why, since 2011, there has been a 30% drop in the number of mental health beds in the NHS, and is it really right that mental health patients are having to travel up to 200 miles to access a bed?

[The Prime Minister]

What matters in our NHS is the quality of provision and parity of esteem between physical health and mental health. This Government have not solved every problem, but we have put proper parity of esteem into the NHS constitution and the NHS mandate. We have also put in proper targets for some of the talking therapies that are absolutely vital in mental health. Measuring the output of our NHS purely by the number of beds is not a sensible approach.

[Iain Stewart (Milton Keynes South) (Con)]

Q8. The Government are making a substantial investment in renewing and expanding the nation’s infrastructure. There is, however, a real need to get more young people into engineering so that we will have the long-term skills base for these projects. Will my right hon. Friend assure me that this Government will do all they can to inspire the next generation of engineers?

[The Prime Minister]

I absolutely back what my hon. Friend says. I know he has been campaigning very hard to get the HS2 academy to go to Milton Keynes, because there is a vital bit of skills work that needs to be done. [Interruption.] I am sure there will be a lot of competition. The key thing about these investments, whether it is Crossrail, the Olympics or HS2, is to plan in advance for the skills that we are going to need so that we can fill the jobs with British people leaving school and college wanting to take on those skills. Today the Chancellor and the Minister for Schools have launched the “Your Life, Your Choice” campaign, which is all about encouraging young people to get into STEM subjects—science, technology, engineering and maths—and to stay in STEM subjects, because there is a massive fall-off from GCSE to A-level, particularly in physics among young women, and we need to encourage them to go on studying.

[Hazel Blears (Salford and Eccles) (Lab)]

I am delighted to see that the Prime Minister is wearing his Dementia Friends badge today. He will congratulate the Alzheimer’s Society on its commitment to get 1 million dementia friends over the next year, but will he also today commit personally to putting an end to the scandal of 15-minute visits, low wages and zero-hours contracts for the dedicated home carers who look after people with dementia in our country?

[The Prime Minister]

First, let me praise the right hon. Lady for her work on dementia and the amount of work she has done to spread awareness about this. The 15-minute working times is an issue for local councils. My local council has just decided to stop these 15-minute visits because it does not believe people can really get any meaningful work done, but this is a matter for councils. We are the first Government to have a proper review on zero-hours contracts. We are very unhappy about those with exclusivity clauses that do not allow people to work elsewhere. As important as those things are, it is as important to make sure that our care system has got people inside it who are really caring and understanding about the problems of dementia. The right hon. Lady and I have both been through the very short Dementia Friends training course, and I do not know about her, but I think I am ready for a refresher.

[Neil Carmichael (Stroud) (Con)]

Q9. With 1.3% growth in manufacturing in the last quarter and some strong performances from my local firms such as Renishaw, Dairy Crest, Lister Communications, Lister Shearing and others, largely through innovation, does the Prime Minister agree that one key element of the long-term economic plan is the need further to strengthen our skills base so that those firms can continue to grow, work hard for Britain, and generate exports?

[The Prime Minister]

My hon. Friend is absolutely right. A key part of the long-term plan is to rebalance our economy away from purely the south-east and also towards manufacturing exports and investment. I know that he has been playing his part by running a festival for manufacturing and engineering in Stroud. This is really important, because one of the things we have to do is inspire a new generation to think of these careers and think of the subjects they should be studying in school and at university to open up these careers for them.

[Keith Vaz (Leicester East) (Lab)]

Last Thursday, the European Union ban on the import of Indian mangos took effect. As a result, hundreds of businesses in Leicester and throughout the UK will suffer millions of pounds of losses. There was no consultation with this House and no vote by British Ministers. Next week, the Prime Minister will have his first conversation with the new Indian Prime Minister. Will he do his best to reverse this ban so that we can keep our special relationship with India, which his predecessors and he have worked so hard to maintain, and have our delicious mangos once again?

[The Prime Minister]

I know how much the right hon. Gentleman cares about this issue, so much so that he delivered a tray of mangos to No. 10 Downing street—missing the deadline, I might add, so that they could safely be consumed by the people inside. I am very grateful for that.

This is a very serious issue. The European Commission has to consider it on the basis of the science and the evidence. There are concerns about cross-contamination of British crops and interests, so we have to make sure that that is got right. I understand how strongly the right hon. Gentleman and the Indian community in this country feel. Indeed, I look forward to discussing the issue with the new Indian Prime Minister.

[Chris White (Warwick and Leamington) (Con)]

Q10. Will the Prime Minister join me in congratulating Vitsoe, the world-class furniture manufacturer, on its decision to locate its manufacturing facility in Leamington and on the jobs that will create? I am proud the decision was based in part on our community’s rich industrial heritage. Will the Prime Minister also pay tribute to local businesses that have created jobs and reduced the number of jobseeker’s allowance claimants in Warwick and Leamington by a remarkable 54% since May 2010?

[The Prime Minister]

I congratulate my hon. Friend on the decline in unemployment in his constituency, which is incredibly marked at 54%. I note what he says about furniture factories, because those are the sorts of businesses that were going offshore. What we are seeing in our country is a slow trend—but I want to encourage it—of reshoring and getting businesses to come back to, and invest and expand in, Britain. We must do everything we can to encourage that by keeping their taxes down, keeping national insurance down, cutting national insurance for young people, training more apprentices and investing in infrastructure. That is what we will do so that there are many more success stories like that mentioned by my hon. Friend.

[Nic Dakin (Scunthorpe) (Lab)]

Q12. My constituent Lorraine Seath’s son has recently returned from serving our country in Afghanistan. Does the Prime Minister think it is right that she has to pay the bedroom tax to keep a room available for her son to stay in when he is at home?

[The Prime Minister]

Let me look at this individual case, because we made a specific exemption from the spare room subsidy for people who were serving overseas. If the spare room subsidy exemption does not apply in this case, there is of course the provision of the discretionary housing payment, which is another way of dealing with this, and I would hope that Scunthorpe borough council would take up that offer.

[Mr Speaker]

I call Mr Simon Burns. [Hon. Members: “More!”] There will indeed be more, which is why we must hear the right hon. Gentleman and then, at my request, others. We are concerned also, I am sure, about others.

[Mr Simon Burns (Chelmsford) (Con)]

Q11. The Prime Minister will be aware that last week the service sector grew at its fastest level this year, with the ensuing creation of jobs. Does he agree that that demonstrates that we must stick with the long-term economic plan, because it is working? I trust my right hon. Friend has enough time to answer the question in full.

[The Prime Minister]

My right hon. Friend is absolutely right: we have to stick to the long-term economic plan and deliver it. For my right hon. Friend to be called at 12.33 pm on a Wednesday shows that if you stick at anything, you can win.

[Mr Speaker]

I have always practised that philosophy myself: however long it takes, we are going to get through them.

[Kate Hoey (Vauxhall) (Lab)]

The Prime Minister will know that recently it has gone into the public domain that more than 365 people in Northern Ireland were given the royal prerogative of mercy, despite 10 years of files being lost. Will he give a commitment that those names will be made public? After all, if the Queen takes the time to sign 365 names, surely the public and particularly the victims have the right to know.

[The Prime Minister]

I would say to the hon. Lady, who I know takes a very close interest in these issues in Northern Ireland, that difficult decisions were taken, principally by the previous Government at the time of the various agreements, which involved very difficult choices—hard choices—that had to be made in order to try to build the platform for peace and reconciliation. I am very happy to look at her specific point and see whether there is anything I can do to reassure her in a letter, but I do not want to unpick decisions taken at a difficult time to try to give us the peace that we enjoy today.

[Zac Goldsmith (Richmond Park) (Con)]

Q13. The chief medical officer warned last month that we are misusing antibiotics to such an extent that we risk returning, in just a matter of years, to a 19th-century environment where routine operations carry a grave risk of death. A couple of days ago, the World Health Organisation issued a similar warning, saying that we are hurtling towards the post-antibiotic age. On that basis, it is surely madness to continue to allow so many antibiotics to be used on our factory farms—about half the total use in this country—when we know that that contributes to resistance.

[The Prime Minister]

My hon. Friend raises an extremely serious problem, which is global in its nature and could have unbelievably bad consequences in terms of anti-microbial resistance leading to quite minor ailments not being properly treatable. One of the problems is that the way research is done currently by pharmaceutical companies is not necessarily bringing forward new antibiotics in the way that we need or solving this problem. I have met the chief medical officer to discuss this. There are a number of steps that we can take here in the UK and working with other countries, and I hope to say something about it soon.

[Mr Adrian Bailey (West Bromwich West) (Lab/Co-op)]

Yesterday, the Secretary of State for Business, Innovation and Skills said that he was working with civil servants to ensure that any assurances given by Pfizer during the proposed takeover of AstraZeneca could be made legally binding. Does the Prime Minister back that?

[The Prime Minister]

As I said, the more we can do to strengthen the assurances we are given, the better. But the only way to get assurances is by engaging and getting stuck in with those companies, which is what we have been doing, and I find it extraordinary that the Labour party chooses to criticise us for that.

[Mr Speaker]

Last but not least, I call Dr Julian Huppert.

[Dr Julian Huppert (Cambridge) (LD)]

Q14. The Pfizer bid for AstraZeneca is driven by tax advantages. Has the Prime Minister spoken to the US Government about whether they propose any changes to their tax law, and has Pfizer asked for any changes to our tax system, particularly to the patent box?

[The Prime Minister]

In its letter to me, Pfizer mentions the patent box as a positive reason for wanting to invest in Britain and for examining whether it could increase manufacturing in Britain. Of course, because of the way the patent box works, you only get the low-tax benefit if you make your investments and do research in the UK, and then exploit that research by manufacturing in the UK. I agree with the hon. Gentleman that we should be incredibly hard-headed about this. It is an advantage that Britain is a low-tax country. We used to stand in this House of Commons and bemoan the fact that companies were leaving because of our high taxes. They now want to come here because of our tax system. I agree with the Business Secretary that that is not enough; we want the investment, the jobs and the research that comes with that competitive tax system.

Petition

Wednesday 7th May 2014 Commons Chamber

Keith Vaz (Leicester East) (Lab)

- Hansard - - Excerpts

If you were at Prime Minister’s questions today, Mr Deputy Speaker, you would know that I asked the Prime Minister about the EU mango ban, a decision taken by the European Union without consulting this House or British Ministers. This vote took place with officials. Last week I asked local residents who were affected by this to gather a petition so I could present it to the House, and in a very short time 329 local residents have signed it—people who regularly buy and eat mangoes and those who sell them. I present this petition today on behalf of Hasmukh Pabari, Darmesh Lakhani, president of the Belgrave road traders association, Joga Sandhu, Shahidullah Khan and Ratilal Patel.

The petition states:

The Petition of residents of Leicester East,

Declares that the EU ban on the importation of Alphonso mangoes from India is unjust, that petitioners are anxious about the hugely detrimental impact that this ban will have on the livelihoods of millions of people in, and on the economies of, both the UK and India, and further declares that there has been a significant lack of consultation with both the Parliament and the affected people.

The Petitioners therefore request that the House of Commons urges the Department for the Environment, Food and Rural Affairs do everything possible to reverse this ban, to develop an action plan on how best to progress in this matter and to better communicate with the people affected.

And the Petitioners remain, etc.

[P001348]

Smoke Alarms (Private Rented Sector)

Wednesday 7th May 2014 Commons Chamber

Motion for leave to bring in a Bill (Standing Order No. 23)

12:38

[Mr Nick Raynsford (Greenwich and Woolwich) (Lab)]

I beg to move,

That leave be given to bring in a Bill to require the Secretary of State to make provision for the mandatory installation of smoke alarms in privately rented accommodation; and for connected purposes.

At the outset, I draw attention to my interests as declared in the Register of Members’ Financial Interests, including my role as a non-executive director of the Fire Protection Association—a not-for-profit organisation that works to improve fire safety.

Smoke alarms save lives. The latest Government statement on the subject, issued by the Department for Communities and Local Government in February, states that

“analysis suggests a person is…4 times more likely to die in a fire in the home if they do not have a working smoke alarm”.

In recent years, as our fire and rescue services have focused increasingly on fire prevention, we have seen a substantial increase in the number of homes that are protected by smoke alarms. Building regulations require smoke alarms to be installed in all new dwellings. The impact of that regulatory requirement, together with national and local promotional campaigns to get alarms fitted in existing properties, has been to ensure that almost nine out of 10 homes across the country are equipped with at least one working smoke alarm.

That still leaves about 2.5 million homes unprotected. By a margin, the largest proportion of unprotected homes are privately rented. The latest available data from the English housing survey suggest that only 82% of privately rented homes were equipped with a working smoke alarm in 2011. The purpose of the Bill is to remedy that by making the installation of a working smoke alarm mandatory in all privately rented housing. I would have no objection to extending the provision to all rented homes, including those rented from councils and housing associations. However, as those sectors have already gone significantly further, with 89% of council properties and 93% of housing association homes having working smoke alarms, it seems sensible to start with the sector where the need is greatest.

Very few people appear to disagree with the proposal. The National Landlords Association says:

“we already advise that it is best practice to install smoke alarms and carbon monoxide detectors in rental properties and are comfortable with this being made a regulatory requirement”.

The British Property Federation says that it

“supports the compulsory roll-out of smoke alarms and CO alarms across the rented sector”.

The Chief Fire Officers Association, which has provided me with very helpful information and guidance in preparing the Bill, is adamant that this proposal is one of the simplest and most effective ways to save lives.

The Government appear to agree. Section 150 of the Energy Act 2013 empowers the Secretary of State to make provision, by statutory instrument, to require residential landlords to ensure that tenanted properties are

“equipped with a required alarm”.

A required alarm is defined as covering smoke alarms and carbon monoxide alarms.

The public appear to support the proposal overwhelmingly. Research by YouGov, which was commissioned by Cheshire fire and rescue service but conducted nationwide, found that 93% of the more than 2,000 respondents agreed with the statement:

“Private landlords should be required by law to ensure that working smoke alarms are fitted in rented residential properties.”

A parallel YouGov survey of businesses found a very similar level of support, with 91% of the 690 respondents agreeing with the statement. Interestingly, when that was broken down by category of business, YouGov found 100% support among real estate respondents. That does not imply that there is opposition to the principle of regulation in the industry.

What can possibly be the objection to taking action? Why has the necessary statutory instrument not been introduced? The clue to answering that question appears in the DCLG consultation paper that was issued in February, to which I have referred. The paper, which is entitled “Review of Property Conditions in the Private Rented Sector”, sets out clearly the forceful arguments in favour of the mandatory installation of smoke alarms and carbon monoxide alarms as a lifesaver. However, the paper continues:

“requiring the installation of smoke alarms in all privately rented homes would impose additional costs on landlords.”

It concludes:

“Regulation is always a last resort and, as part of the review, we will also explore the scope for non-regulatory alternatives to promote further take-up.”

I find that regulatory burden argument wholly unconvincing. As I have pointed out, the National Landlords Association and the British Property Federation are in favour of the proposal. When the representative bodies for the businesses concerned are not complaining about the regulatory burden, why on earth do the Government see a problem?

The Government are sceptical about regulation, but that scepticism does not prevent them from imposing new regulatory burdens on landlords when they want to. For example, the Immigration Bill, which the House will debate this afternoon, will impose penalties of up to £3,000 on landlords who let premises to people who do not have leave to remain in the UK, even if they were unaware of their tenant’s immigration status. Landlord representatives have made it clear that they oppose that new regulatory burden, but the Government have insisted on keeping the provision in the Bill.

However, when landlord representatives are not opposed to a new regulation that would save lives, the Government appear less committed. That is, frankly, perverse. The cost would be tiny both in absolute terms and as a proportion of landlords’ income. A sealed smoke detector with a 10-year battery costs about £15, which is only £1.50 a year spread over the life of the battery. Even if three or four alarms needed to be installed, it would still be no more than £6 a year, compared with an average rental income from a private letting of more than £10,000 a year. The regulatory burden argument is wholly unpersuasive, and we simply cannot allow such a flimsy pretext to delay any further the necessary action to save lives.

Nor is it the case that, as the DCLG consultation paper implies, voluntary arrangements without a regulatory obligation will be an adequate alternative. We have certainly seen real progress in voluntary arrangements to date, with the number of existing homes protected by smoke alarms increasing dramatically over the past decades. However, a law of diminishing returns is at work. Landlords keen to do the right thing will almost all have installed alarms by now. Those who are negligent or indifferent to tenant safety may well not have done so. Without a legal obligation, it is unlikely that they will respond positively to further encouragement. That is one reason why landlord representatives are not opposed to making the installation of smoke alarms a regulatory obligation. It would ensure that there was a level playing field and help raise safety standards across the whole sector.

The failure of irresponsible or negligent landlords should no longer be allowed to damage the reputation of the whole private rented sector. The case for the mandatory installation of smoke alarms in all privately rented housing is overwhelmingly strong, which is why I am presenting the Bill as a call to action. I am delighted that it is supported by Members from throughout the House, and I am grateful to all right hon. and hon. Members who have agreed to add their names as sponsors. It is a simple, common-sense measure that would save lives, and I commend it to the House.

12:47

[Philip Davies (Shipley) (Con)]

I rise to oppose the Bill. First, like the right hon. Member for Greenwich and Woolwich (Mr Raynsford), I should draw the House’s attention to an interest declared in the Register of Members’ Financial Interests. As I have made clear before, I am a landlord, although an accidental one, and a tenant as well, so perhaps I am in an unusual position in being able to see both sides of the argument from personal experience. I want to place on record my thanks to the Residential Landlords Association for its help on the issue. Although it does not oppose the right hon. Gentleman’s proposal outright, as I do, it has highlighted to me a number of potential problems with it.

Perhaps I should start with something that the right hon. Gentleman failed to mention: his former ministerial role. He was the Minister in charge of this area of policy, and he had the opportunity to introduce the law that he suggests, but he did absolutely nothing about it. We should start compiling a list of things that Opposition Members ask for that they failed to do in their 13 years in office. The right hon. Gentleman has gone one step further, because he was the Minister responsible and did absolutely nothing. In fact, when he was questioned about what measures he would take to require more smoke alarms in properties, he used to give answers that mentioned everything apart from a mandatory requirement for private landlords to install them. He asks how on earth anyone could oppose the Bill, but the question for him should be why on earth he did not introduce it when he was the Minister responsible if it is such a fantastic idea. I might add that at the time he failed to introduce it, there were far fewer private landlords with smoke alarms and far more fires. If there was ever a time to do it, it would have been when he was a Minister, rather than now.

There is no doubt that the desire exists to reduce and eliminate the number of incidents and fatalities that horrifically result from fire accidents, but I wish to record my concerns about the Bill because I do not believe that it provides the necessary solution. Surely, it is obviously in everyone’s interests to have a fire prevention device installed in their property. In a rented property, the tenant would want one to protect themselves and their family, and the landlord would be keen to protect their property from any chance of fire damage—the figures bear that out.

In answer to a parliamentary question on 27 March, the Under-Secretary of State for Communities and Local Government, my hon. Friend the Member for Keighley (Kris Hopkins), stated that 82% of privately rented properties already have a smoke alarm. As I find myself saying all the time, some people want to regulate everything in the name of a worthy cause. However, potentially criminalising law-abiding, decent landlords—the vast majority of whom, by anyone’s standards, have properties with smoke alarms already fitted—and adding to the burdens that could put them off renting their properties will have undoubted unintended consequences on the market and the very people this proposal seeks to protect.

The right hon. Gentleman spoke about the cost of this measure as though that were the only factor, but it is not. The risk of prosecution is a factor for landlords when making these decisions. The practicalities of implementing and enforcing a mandatory programme to install smoke alarms in private rented accommodation could make it incredibly inefficient and almost impossible to police. Although landlords would be legally obliged to install such devices in their properties, they would not be able to check the status of the alarm regularly. Shifting that responsibility to the landlord, who has irregular and unguaranteed access to the property, might result in testing becoming a less regular affair than would otherwise be the case.

We should also consider tenant responsibility. Given that time and again it appears that tenants interfere with fire protection devices in their property, how can the landlord be held responsible if those sensitive alarms are disconnected or tampered with? You do not have to take my word for it, Mr Speaker, because when the right hon. Gentleman was a Minister, he stated in a parliamentary answer that

“in approximately 9 per cent. of households containing fitted smoke alarms at least one alarm has either been disconnected or has had the battery removed.”—[Official Report, 13 January 2003; Vol. 397, c. 392W.]

How can a landlord be held responsible for that?

If a tenant were to remove the batteries, cover the sensor or disconnect the device completely without notifying the landlord, would it still be the landlord’s responsibility to ensure that those protection devices were engaged, and if so, how? [Interruption.] Opposition Members are chuntering, but they just like having noble ideas. They have absolutely no idea about the practicalities because they never think anything through. It is totally impractical, impossible and unrealistic to expect a landlord to check on the status of all smoke alarms in his or her properties on a daily basis to ensure that all devices are connected and operational. How on earth are they expected to do that? If smoke alarms are not working, they are pointless.

How many smoke alarms would be satisfactory? Guidelines seem to suggest that an alarm should be present on every floor of a property, but given the nature of private letting, where rooms are often let on an individual basis, will the landlord need to provide a separate alarm in all rooms of the property? Would one alarm in an eight-bedroom property be sufficient? Not only would excessive alarm installation amount to an increased financial burden on the landlord, but it would no doubt have a knock-on effect on tenants, who will pay extra to rent those properties.

A mandatory smoke alarm policy could reduce the use or consideration of alternative safety alarms and measures. I believe that heat alarms have been acknowledged as a suitable and in some cases more appropriate alternative to smoke alarms. They reduce the risk of accidentally triggering an alarm, which in turn lessens the chances of tenants actively disengaging them. The Residential Landlords Association recently pointed out that it is clear from relevant British standards and Local Authorities Co-ordinators of Regulatory Services guidance, that in certain situations the fitting of a heat alarm is more appropriate. Smoke detectors are not appropriate in kitchens because of the higher risk of accidentally setting off the alarm. [Interruption.] Labour Members do not like listening to this because they have not thought it through. Any mandatory policy on smoke alarms could create a climate where landlords might remove a more effective heat alarm system and replace it with a less effective smoke alarm system that would be less suitable for the type of property and tenant, just because of the right hon. Gentleman’s diktat.

I understand that private rented accommodation is already covered by an extensive amount of safety regulations, including on fire safety, which makes this proposed extra burden seem completely unnecessary. Local authorities already have powers to require the provision of smoke alarms where necessary through the housing, health and safety rating system. A British standard underpins various provisions for the installation of fire detection, along with LACORS guidance, as agreed by the Department for Communities and Local Government and the Chief Fire Officers Association, and that is the basis for fire protection in existing dwellings. A clear downward trend in fire deaths and injuries has been evident for many years in fire statistics. Although those statistics are encouraging, they bring into question the need to adopt compulsion for fitting smoke alarms when steps are already being taken in the right direction and with excellent results.

Finally, I have great concerns about discriminatory treatment in relation to private landlords. If the intention is to promote fire safety, surely the right hon. Gentleman’s motion should apply to the mandatory installation of smoke alarms in all types of accommodation and not single out private landlords. Given everything that I have said, I do not believe there should be any move towards the mandatory provision of smoke alarms in private rented accommodation. As mentioned, the Bill applies only to private landlords, not to social housing or owner-occupied homes, despite the threat of fire not respecting such boundaries.

The Labour party thinks that, whatever something is, it must be regulated, that there must be a law for it and that we must have more burdens and unnecessary regulations, but I think that this provision is completely unnecessary. The right hon. Gentleman needs to explain why he did absolutely nothing to introduce this measure when he was a Minister and in a position to do so. I oppose this Bill. I will allow the right hon. Gentleman his moment in the sunlight and his moment of glory, and I will not seek to divide the House. However, I hope that the Minister will register my points and not introduce this ridiculously unnecessary nanny-state proposal.

Question put (Standing Order No. 23).

12:57

Division 265

Ayes: 245

---

Labour: 196
Conservative: 24
Liberal Democrat: 14
Democratic Unionist Party: 6
Social Democratic & Labour Party: 2
Plaid Cymru: 2
Independent: 1
Green Party: 1

Noes: 8

---

Conservative: 8

Ordered,

That Mr Nick Raynsford, Jim Fitzpatrick, Alistair Burt, Mr Andrew Love, Mr Adrian Sanders, Mrs Mary Glindon, Peter Aldous, Mr Barry Sheerman, Mr David Amess, John Healey and Bob Blackman present the Bill.

Mr Nick Raynsford accordingly presented the Bill.

Bill read the First time; to be read a Second time on Thursday 15 May, and to be printed (Bill 207).

Water Bill (Programme) (No. 2)

Motion made, and Question put forthwith (Standing Order No. 83A(7)),

That the following provisions shall apply to the Water Bill for the purpose of supplementing the Order of 25 November 2013 (Water 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 three hours after their commencement at today’s sitting.

(2) The proceedings shall be taken in the following order: Lords Amendments Nos. 15 to 30, 32, 33, 43 to 64, 101 to 103, 107 to 147, 1 to 14, 31, 34 to 42, 65, 66, 104, 67 to 100, 105, 106.

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.—[Harriett Baldwin.]

Question agreed to.

Water Bill

Wednesday 7th May 2014 Commons Chamber

Consideration of Lords amendments

[Mr Speaker]

I must draw the attention of the House to the fact that financial privilege is involved in Lords amendment 142. If the House agrees to it, I will cause an appropriate entry to be made in the Journal.

Clause 10

Agreements by water undertakers to adopt infrastructure

13:11

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

I beg to move, That this House agrees with Lords amendment 15.

[Mr Speaker]

With this it will be convenient to discuss Lords amendments 16 to 30, 32, 33, 43 to 64, 101 to 103, and 107 to 147.

[Dan Rogerson]

The Lords amendments relate to the subject of market reform, and in particular to retail exits. By that I mean allowing an incumbent water company to exit from the market for retail services to non-household customers.

Lords amendments 15 to 30, 43 to 48, 101 to 103 and 107 to 147 are minor technical or consequential amendments to the market reform provisions in the Bill—for example, changing wording from “a code” to “the code”. Some are minor and technical amendments relating to cross-border pipes. Lords amendments 32 and 33 ensure that the Consumer Council for Water is consulted on water company charges schemes. The Government are keen to ensure that customers are protected, and are grateful to Opposition Members for highlighting the important work done by the council on behalf of customers. We expect it to contribute to all discussions about the future of the industry, and we are pleased to have been able to enhance that in the Bill.

Lords amendments 49 to 52 would implement recommendations made by the Delegated Powers and Regulatory Reform Committee in another place. We are very grateful for the Committee’s scrutiny of the Bill. I do not propose to refer to the amendments in detail, but I shall be happy to respond to any specific queries.

Lords amendments 53 to 64 deal with the issue of retail exits, which we have discussed previously in the House. The Bill seeks to introduce a range of reforms that will enhance and extend competition in the water sector. The Government believe that the development of competition in the sector will bring real benefits to customers. They listened to, and acted on, well-argued contributions to the debate on market reform, especially the calls for incumbent water companies to be able to choose to exit from the non-household retail market.

I think it would be appropriate for me to expand on the retail exit amendments, as the House is not familiar with the clauses involved. The amendments differ in some crucial ways from amendments on the subject that Members have seen before. When drafting the amendments, we were particularly careful to ensure that customers were protected, both the non-household customers who will be transferred to a different retailer and the household customers who will remain with the incumbent. Non-Government amendments tabled by Members here and in another place have not reflected those safeguards fully.

The Lords amendments relating to retail exits contain three core principles. Exits must involve non-household customers only, they must be undertaken voluntarily, and they must ensure the ongoing protection of customers. Any exit will be possible only with the consent of the Secretary of State. Other amendments that the House has considered did not grapple with those key issues. These amendments create broad, permissive powers in what will be a very complex area. Further work will be required to consider the practical implications of exits, and to develop the detailed policies that will underpin the use of the powers. We will therefore be consulting widely with all interested parties as we develop our approach and produce exit regulations.

13:15

So what do the Lords amendments actually do? They give the Secretary of State powers to establish, through regulations, a framework that permits incumbent water or sewerage companies—with the consent of the Secretary of State—to stop supplying any retail services to current or future non-household customers in their areas of appointment. The services will then be provided by one or more retail licensees. Any incumbent water company whose area is wholly or mainly in England will be able to apply to the Secretary of State to exit from the non-household retail market for that area.

This approach reflects amendments tabled by parties in both Houses, but builds on them by increasing safeguards. These amendments ensure, for example, that in allowing retail exits we will not make forced separation possible, which an amendment tabled by the hon. Member for Dunfermline and West Fife (Thomas Docherty) would have done. We do not want to take risks with a successful model, given the challenges that we face in building the resilience of the sector, which is a crucial aim of the Bill and our programme of water reform. We cannot risk damaging investor confidence.

The amendments are enabling only, and we are committed to full public consultation on how best to implement the provision for retail exits. We will consult on the content of draft regulations by the end of the year. We will work closely with incumbent water companies, Ofwat, the Competition and Markets Authority, the Consumer Council for Water and others as we develop our approach and produce the regulations. We will also send a copy of the draft regulations to the Environment, Food and Rural Affairs Committee to give it an opportunity to comment. In addition, Ministers will make themselves available to Members of both Houses for further discussions as we develop the regulations, given the limited opportunities for parliamentary scrutiny of this part of the Bill.

Let me explain some key elements of the regulation-making powers. They provide for the protection of both household and non-household customers who are affected by the exit. As I have said, it is of paramount importance that we ensure that customers are protected. The regulations may provide for the transfer of customers, and set out what will happen in an area where a company will no longer be providing retail services for non-household customers. They must ensure the protection of any non-household customers who are subject to a transfer, as well as household customers who remain with the incumbent. The amendments enable the Secretary of State to make regulations that establish strong safeguards. That extends to requiring the exiting incumbent to take certain steps before making an application, such as consulting its customers.

Our intention is that any exit must be voluntary, and must be delivered in a way that ensures continued protection both for non-household customers and for householders who will not be able to switch their suppliers. In order to prevent forced separation or exit, the amendments require the Secretary of State to consent to any application to exit.

Lords amendment 54 also sets out some of the grounds on which an application to exit could be refused—for example, if the company could not demonstrate that exit was in the best interests of customers or in the public interest. Lords amendments 59 and 61 also underline our intention that exits should be voluntary. In developing the exit regulations, we recognise the regulatory independence of the competition authorities, and the provisions are not intended to undermine it.

The Enterprise and Regulatory Reform Act 2013 reaffirmed the importance that the Government ascribe to an independent competition regime. Lords amendment 61 enables the Secretary of State to make a statement about the Government’s policy on voluntary exits. Any statement issued would fully reflect the Government’s wider approach to competition and the independence of the regulators. Lords amendment 62 provides a power to make changes in the duties and powers of a number of public bodies, including Ofwat and the Competition and Markets Authority. The amendment is necessary because the exit regulations are likely to involve changes in the existing legislative regime. Its scope is limited to the necessary adaptations of the framework governing the exit arrangements in the water sector. Any changes will be very specific to retail exits.

Let me end by welcoming the hon. Member for Penistone and Stocksbridge (Angela Smith) to her new position. While we may disagree on matters of policy from time to time, I have the greatest respect for the contribution that she makes in the House—and it is good to have someone of Cornish descent facing me across the Dispatch Box.

[Angela Smith (Penistone and Stocksbridge) (Lab)]

May I start by thanking the Minister for his kind comments?

As it is some time since the Bill was debated on the Floor of the House, I want briefly to refresh the memories of Members on it. It includes many important reforms that attempt to build on three important reviews taken forward by the previous Government: the Pitt review on flooding, the Walker review on affordability, and the Cave review on competition.

Throughout the Bill’s long passage through Parliament the Opposition have been supportive. In the Commons we voted for it on Second Reading and on Third Reading. In the other place, although we raised legitimate concerns and challenged the Government, again we remained broadly supportive of the Bill. We have backed measures to increase competition. We have supported measures that will provide a statutory basis for agreement on flood reinsurance, providing affordable insurance to households who would have otherwise not been covered. However, as my hon. Friend the Member for Garston and Halewood (Maria Eagle) pointed out on Third Reading, there still remains even now a major hole at the heart of the Bill, and at the heart of the Government’s water policy: the absence of any serious attempt to tackle the impact of rising water bills on household budgets, which is adding to the cost of living crisis.

Unfortunately, the Government have failed to back a new national affordability scheme that would have ended the current postcode lottery in which companies choose whether to offer a social tariff and set the criteria for eligibility. Last year the industry made £1.9 billion in pre-tax profits, of which they returned £1.8 billion to shareholders, yet fewer than 25,000 people are eligible to benefit from social tariffs offered by just three water companies. In many ways, therefore, the Bill represents a missed opportunity and remains seriously flawed, despite its being improved by amendments made in the other place.

Although we will not vote against any of the first group of amendments, that does not mean that we believe that the Bill could not have been made stronger and more effective through the adoption of our amendments. We are where we are, as they say. While, as the Minister pointed out, most amendments in the group present a series of technical and drafting changes, amendments 32 and 33, amendments 49 to 52 and amendments 53 to 64 make significant changes to the Bill that was debated in the Commons.

Amendments 32 and 33, which were originally introduced in Committee by Lord Grantchester, give a new role to the Consumer Council for Water. They will require Ofwat to issue rules that will mean that the CCW must be consulted by water and sewerage undertakers on all charges schemes. That will allow the CCW to play a role at an early stage in the charges process and will enable it to flag up problems, before the relevant bills start arriving on customers’ doorsteps and further problems occur. For example, as Lord Grantchester pointed out in Committee, the CCW had previously challenged the charging plans of some companies that restricted half-yearly payment options for those on direct debit payments. Some customers prefer to pay on a half-yearly basis, as it better enables them to manage their money.

Although we welcome the amendments, which we promoted in the other place, it is a pity that the Government have not gone further by accepting our argument that we need to tackle the impact of rising water bills on household budgets. As I said, the Government could have backed our plans for a new national affordability scheme that would have ended the current postcode lottery in which companies choose whether or not to offer a social tariff, with no minimum standards in place to ensure fair and effective affordability measures.

Amendments 49 and 50 introduce parliamentary scrutiny for any regulations that the Secretary of State may deem fit to introduce under clauses 37 and 39. The amendments, which were introduced at a very late stage—I think on Third Reading in the Lords—mean that the affirmative procedure will now apply on the first exercise of those powers. That is quite right, especially given the importance of the regulations in question. It is a pity, however, that the Government have been forced into this position and have had to be pushed into introducing the amendments by Labour Members and the Delegated Powers and Regulatory Reform Committee in the other place. That Committee made firm recommendations in this regard, and has rightly argued that the Secretary of State would have enjoyed so-called Henry VIII powers over many parts of the Act if the Bill had remained unamended, so Parliament is right to assert its right to scrutinise the relevant regulations as and when they see the light of day.

Amendments 53 to 64 deal with retail exit. I want to put it on the record that we have also backed measures in the Bill that increase competition to support businesses that wish to enter the retail market for non-domestic consumers. The measures are similar to those that have been a success north of the border; Scotland became the first country in the world to introduce competition to the non-domestic water market in 2008. We find it odd, however, that the Government have repeatedly dragged their feet in relation to allowing such businesses to exit this market. Without our persistence, which was shared by peers on the Government Benches, the Government’s original proposals would not create a market at all.

Retail exit enjoys a great deal of support, including from Ofwat, the Environment, Food and Rural Affairs Committee and some of the major water companies. Indeed, in Committee, amendments introduced by the Chair of the Select Committee, the hon. Member for Thirsk and Malton (Miss McIntosh), were not supported by the Government. In the other place, Lord Whitty commented that there was bemusement in all parts of the House as to why the Government were so resistant to the concept of exit in the new retail market, and introduced an amendment that would have allowed it. His arguments were not, however, supported by the Government, who gave the lame reason that such a measure would cause investor insecurity. On Report, Lord Moynihan introduced an amendment that would have gained our support, but he withdrew it on advice that the Government would introduce an amendment on Third Reading. Although we welcome the Government’s late conversion, we have to wonder why they resisted such a measure during most of the Bill’s progress through this House and the other place. Surely it would have been more appropriate if the amendments had been brought forward earlier, to allow adequate parliamentary scrutiny. Once again, however, we are where we are.

It is also right that, when and if regulations are brought forward by the Secretary of State, they will be laid before both Houses under the super-affirmative procedure. I pay tribute again to the work of the Delegated Powers and Regulatory Reform Committee in highlighting the need for that even at the 11th hour of the Bill’s passage through Parliament.

[Miss Anne McIntosh (Thirsk and Malton) (Con)]

First, I welcome the hon. Member for Penistone and Stocksbridge (Angela Smith) to her new position, and pay tribute to her predecessor, the hon. Member for Dunfermline and West Fife (Thomas Docherty). I understand that they have performed a job swap. The hon. Gentleman has made a big contribution to this debate and, in the past, to the work of the Environment, Food and Rural Affairs Committee. I can only apologise to both Front-Bench teams that there are not more colleagues from the Committee here today. The reason for that is that we are undertaking a farm visit this afternoon. I had to give my excuses and will be joining colleagues later for the completion of the visit today and tomorrow. It would be churlish of me not to congratulate my hon. Friend the Minister and welcome both the outbreak of common sense in the other place and in the Department and a very welcome and worthwhile amendment.

I shall briefly go over the deliberations in the Select Committee and the earlier proceedings in this place. In our report on the draft Water Bill, the Committee strongly recommended that the Bill should include provisions to enable incumbent companies to exit the retail market voluntarily. Indeed, as the hon. Member for Penistone and Stocksbridge mentioned, the Committee tabled a new clause in my name on Report to provide for retail exit. Also, during the course of the inquiry both regulators—Ofwat and the Water Industry Commission for Scotland—the incumbent companies and new entrants were united in calling for the Bill to include an exit route. WICS provided a welcome and helpful explanatory note, and I hope the amendment it proposed during the Commons stages of the Bill will bear fruit today.

13:30

In the Public Bill Committee, Opposition Members proposed a new clause to allow the incumbent companies to choose to provide to the retail market or wholesale market only, subject to approval by the Secretary of State. Regrettably, that amendment was lost, but we heard some powerful arguments in favour of allowing retail exit, which include the following: an exit clause is needed to allow the market to function as a normal competitive market; a company should be able to organise its business in the way it considers best for the interests of shareholders and customers; and an exit clause facilitates entry by new entrants, particularly larger ones, into the water and sewerage retail market, as they would not have to win one contract at a time. Without today’s amendment, economies of scale would work against new entrants, either preventing them from entering the market or, at the very least, reducing the benefits they could provide to new customers because of the higher costs of entry. It is also not in the interest of the companies or customers to force companies to stay in a market when they have no or very few customers. It is, therefore, entirely appropriate that the amendment recognises that this is about the proper functioning of the market.

Many of the amendments in the group are technical and I do not propose to comment on them, but I believe they go some way towards resolving issues with the drafting of the Bill or addressing concerns expressed during the Lords stages of the Bill. Clearly the amendment on retail exit is the most substantial. I echo the hon. Lady’s concerns, as I am sure other hon. Members would, about the lateness of the hour of this move, but the amendment is before us today and we should welcome its content. I believe the Minister recognises that there are a wide range of views in the industry on this subject, and all companies will wish to have the opportunity to provide input on the detailed arrangements that would be needed to ensure that any option for companies to exit voluntarily the non-household retail market did not have unintended consequences. Therefore, we should welcome the positive development of the amendment providing appropriate opportunities, as he explained, for full engagement and consultation with all interested parties and for consideration of all potential implications of allowing voluntary exit from the non-household retail market. I particularly welcome the role that will be played by the Consumer Council for Water, because it has, certainly in my area, a positive role to play.

I ask the Minister to elaborate on one comment made by Lord De Mauley in the other place when these amendments were discussed on Third Reading. He said that regulations made under these provisions on voluntary exit would be subject to an “enhanced affirmative” procedure, whereby draft regulations would be laid before the House. I have not heard that expression before, so I would welcome any clarification the Minister can provide on it. The right for companies to exit in this way reflects market conditions and it can only enhance investor confidence, because anything else would have been an intolerable situation, as a company would not have been allowed to exit, thus placing both company and its customers in a difficult position. Obviously, it is pleasing to note that the draft regulations will be subject to the full scrutiny by the Select Committee on Environment, Food and Rural Affairs, and our having the earliest sight of the regulations will permit us to perform that scrutiny within the timetable he has set out. I also welcome the fact that the Department has allowed a full consultation. With those remarks, I welcome this small group of amendments, as I recognise that allowing a voluntary exit can only enhance the Bill’s provisions in this sector.

[Dan Rogerson]

First, may I welcome you to the Chair, Ms Primarolo? I thank the hon. Member for Penistone and Stocksbridge (Angela Smith) and my hon. Friend the Member for Thirsk and Malton (Miss McIntosh) for their contributions today, and the latter for the contribution she has made as Chair of the Select Committee, both throughout this process and long before any Bill was formally considered in both Houses.

The hon. Member for Penistone and Stocksbridge raised a number of issues and returned to the issue of affordability. The Government have made it clear that the best thing we can do on affordability is keep bills low for everybody by having a robust regulator and setting out to that regulator the policy framework to which we aspire in order for things to happen. The regulator has taken good action to explore with companies what they can do to keep bills lower; that is the trend we are seeing into the next price review period, with some companies bringing it forward into the current period as well, to the benefit of all consumers. Of course, this Government took action to deal with the acute situation in the south-west, where bills were much higher than everywhere else in the country. The hon. Lady rightly points out the contribution that social tariffs can make and the fact that three companies have introduced them. Other companies are bringing them forward in the next year or so, following consultation with their customer base. It is important that that consultation takes place, because introducing social tariffs involves a funding mechanism.

The Opposition have talked of a national scheme, but they did not introduce one when they were in government. We can continue to debate that, but my concerns with such a scheme, and those of the Government, are that the situation in each water company area is different. Therefore, one scheme mandated across the whole area will have different impacts on different customer groups across those water company areas and may have perverse impacts on the bills of some, given the different demographics and mix of bill payers. We are not convinced of that approach, but I welcome the Opposition’s support for social tariffs where they have been introduced.

The hon. Member for Penistone and Stocksbridge raised the issue of parliamentary scrutiny, as did the Chair of the Select Committee. We have listened to concerns and examined the use of the affirmative procedure where necessary. When we get into the realms of the super-affirmative procedure I bow to those with more experience of the range of options at the House’s disposal and how such a procedure might be used. We feel that the affirmative procedure is the correct one to take things forward, but we very much welcome the work done by the relevant Committee in another place to make suggestions on how to ensure that Members of both Houses, and those observing our deliberations externally, will have confidence that we have got things right.

I spoke earlier about the position on retail exits, but there are a couple of further things to say in response to the two speeches we have just heard. First, the Government’s position has never been that such exits should never happen and that we would never make proposals for them. We said at earlier stages that we had concerns, given the range of opinions held across the industry. Both regulators have supported such provisions throughout, whereas the Consumer Council for Water had a much more nuanced position. Some companies were very concerned about it, as were some investors, particularly with regard to pressure for the forced separation of companies. We know that investors would be concerned about that, and we want to see continuing investment in improving resilience, which is a key feature of where we are going with our programme. We are very concerned about the position of household customers, who will not have the options under this Bill that non-household customers have.

With that in mind, we have introduced amendments that take heed of arguments made by Opposition and Government Members, as well as people outside the House, and which put in place safeguards that make sure that all customers are protected throughout any process of change. There will be further consultation, as my hon. Friend the Member for Thirsk and Malton has said, which is crucial, and the question of forced separation, for example, can be addressed. On that basis, the amendments introduced by the Government allow us to move forward on the potential for retail exit in a measured way. That is the difference between the earlier debates on the Bill and where we are now. I thank the hon. Member for Penistone and Stocksbridge for her contribution, and I thank my hon. Friend the Member for Thirsk and Malton and the Committee for the work that they have done.

[Miss McIntosh]

I am most grateful for what my hon. Friend has said, but would he clarify the enhanced affirmative procedure?

[Dan Rogerson]

When the House considers options on the enhanced affirmative procedure there is a range of processes that can be used, but we believe that the affirmative procedure is the correct one with regard to most of the changes that we have discussed this afternoon. I thank hon. Members for their contributions to the discussion on this group of amendments. I hope that the House approves the amendments and that we can agree the changes made in another place.

Lords amendment 15 agreed to.

Lords amendments 16 to 30, 32, 33, 43 to 64, 101 to 103, 107 to 147 agreed to, with Commons financial privileges waived in respect of Lords amendment 142.

Clause 8

Bulk supply of water by water undertakers

[Madam Deputy Speaker (Dawn Primarolo)]

The Minister will move Lords amendment 1 formally. [Interruption.] I am sorry, Minister, I did not intend to cut you off. I meant to say that the Minister will move Lords amendment 1.

[Dan Rogerson]

I am grateful, Madam Deputy Speaker. I am delighted that the Chair has such confidence in what happened in another place that she does not need to hear anything further.

I beg to move, That this House agrees with Lords amendment 1.

[Madam Deputy Speaker]

With this it will be convenient to consider Lords amendments 2 to 14, 31, 34 to 42, 65, 66 and 104.

[Dan Rogerson]

As you have shown, Madam Deputy Speaker, there are many amendments in this group, so I shall try to make my explanation as brief as possible, as I sense that that will be popular.

This group of amendments was tabled in the other place to build on and strengthen further the existing environmental protections under the Bill and to provide reassurance regarding the timetable for abstraction reform and its relationship to the upstream reforms in the Bill. In particular, this group of amendments reinforces environmental protections under the bulk supply and private water storage regimes, improves the resilience duty and the strategic policy statement, and places a new duty on the Secretary of State to provide Parliament with a progress report on abstraction reform.

This group also contains a number of minor and technical amendments. As before, I will not dwell on them, but I am happy to consider any points that hon. Members wish to make. The Government welcome the scrutiny that the Bill has received, and we have listened carefully to all the speeches made in this House and another place. Protection of the environment is close to my heart, and it is important to the Government too. Indeed, one of the Bill’s main objectives is to increase the resilience of our water supplies to ensure a future in which water is always available to supply households and businesses without damaging the environment. I am therefore delighted to bring back a number of important amendments that will ensure the continued protection of the environment.

First, the Government have strengthened environmental protections under the bulk supply regime under clause 8. There are already several bulk supply agreements in the current system and there is a number of environmental protections in place. However, we have listened to the concerns raised on this issue during the passage of the Bill and have enhanced those protections accordingly. Ofwat can only order, vary or terminate a bulk supply agreement at the request of one of the parties, and after consulting the Environment Agency or Natural Resources Wales. Our amendments strengthen the consultation requirement by clarifying the fact that Ofwat can take environmental considerations into account before ordering, varying or terminating a bulk supply agreement. The amendments add a requirement for Ofwat to consult the Environment Agency and Natural Resources Wales before it issues the codes in this area.

13:45

Water companies have statutory environmental duties that prevent them from entering into bulk supply agreements that would damage the environment. However, our amendments reinforce this protection by adding a requirement for such codes to require the parties to a bulk supply agreement to consult the relevant environmental regulator before entering into the agreement. We have also added an enforceable duty on the supplying party to provide information about the water supplied at the request of the relevant environmental regulator.

Secondly, we have strengthened the environmental protections with regard to water supply agreements under clause 12. We have amended the clause so that the regulations about water supply agreements between incumbent water companies and other relevant parties can require Ofwat to consult the Environment Agency or Natural Resources Wales before ordering, varying or terminating such an agreement. The amendments to clauses 8 and 12 will provide a greater role for the Environment Agency and Natural Resources Wales. We recognise the important role that those bodies play in ensuring that environmental considerations are taken into account. This is a more proactive approach and one that the regulatory bodies support.

Thirdly, I am pleased to note the widespread support for the new resilience duty under clause 22. Following debates in another place, that support has been further strengthened so that it explicitly requires Ofwat to promote the efficient use of water by water companies. That could include, for example, capturing and retaining water by investing in new water storage or by tackling leakage. That will ensure that this precious resource is used as efficiently as possible, and it will contribute to the Bill’s objective of increasing resilience in the water sector.

Fourthly, we have amended clause 24 so that the Secretary of State and Welsh Ministers must have regard to social and environmental matters when setting strategic priorities and objectives for Ofwat. Clause 24 is designed to help Ofwat to weigh all the relevant considerations appropriately when making regulatory decisions. We agree with Members in the other place that the consolidated guidance must include social and environmental considerations. We have therefore clarified the fact that social and environmental matters form an integral part of this process.

Finally, we have tabled a significant amendment that will place a new duty on the Secretary of State to report to Parliament on progress on abstraction reform in England within five years of Royal Assent. This amendment signals the Government’s determination to progress abstraction reform and ensures that the Government are fully accountable to Parliament for the delivery of this commitment. In practice, this will mean that a written progress report will be laid before Parliament no later than early 2019. We cannot commit to a timetable for introducing legislation on abstraction reform, but our aim is to introduce the necessary legislation early in the next Parliament. The report will also provide the opportunity to update Parliament on the preparations for implementation of both abstraction reform and upstream reform, and how the two are closely aligned, as well as setting out any other progress on moving towards a more sustainable abstraction regime.

[Angela Smith]

I thank the Minister for introducing the second group of amendments, which relate to some very important provisions in the Bill.

Lords amendments 1 to 14 are largely drafting amendments, but they include some important additions to the Bill. Lords amendments 1 to 3 detail the efficient use of water resources and take into account the effect on the environment of water use, with particular reference to what constitutes a bulk supply agreement with water undertakers, and the effect of such agreements on the environment. Lords amendments 1 to 14 and Lords amendment 31 give a greater role, as the Minister acknowledged, to the Environment Agency and Natural Resources Wales with regard to the effects on the environment of bulk supply agreements. We welcome the strengthening of the role of these two bodies to provide environmental expertise and to prevent bulk supply agreements from damaging the environment.

Amendments 34 to 42 relate to social and environmental safeguards more generally, and amendment 38 in particular requires that the Secretary of State and Welsh Ministers “must” have regard to social and environmental matters when compiling their statements to Ofwat, thereby strengthening the requirement in the Bill. The change from “may” to “must” have regard is a major concession by the Government. Given the importance of securing environmental safeguards at the heart of all aspects of water management, one can say only that it is surprising that the Government did not make that amendment of their own volition, rather than as a result of facing pressure from Members of both Houses on the point.

It is important to put on the record our deep disappointment that the Government have not gone further and recognised the need to make the Bill stronger and more effective by making sustainable development a primary duty for the regulator, as is the case with other regulators. We believe that resilience and the associated term that the Government use here—“the efficient use of water”—are not good enough. In the water White Paper, the Government said that they would carefully consider the case for that, and many environmental organisations are concerned that Ofwat does not have the necessary powers to prevent environmental damage and damaging water exploitation. That is particularly important in the light of greater competition, where companies will be looking to maximise efficiency however they can. Without a tough regulatory duty, that could come at the expense of the environment. My question to the Minister about the Government’s failure to grasp the opportunity presented by the Bill to strengthen regulation in this regard is this: why have they failed to respond to this vital issue in a robust manner and safeguard our environment?

On water abstraction, the Government’s White Paper, “Water for Life”, published in 2011, set out the case for a comprehensive reform of abstraction licences, suggesting that the current licensing system was outdated and in need of urgent reform to deal with increasing pressure on water resources—an issue with which we are all now familiar. Pressures develop because of population change and climate change. The Government tabled an amendment requiring the Secretary of State to publish a report on abstraction reform within five years. That is in the context, however, of the Government’s decision to allow the introduction of greater competition in the upstream market to take effect before reform of the abstraction regime.

We, along with leading environmental experts, are concerned that without comprehensive abstraction reform, upstream competition could incentivise existing abstraction licence holders to sell their water to water companies, even when the catchment is already over-abstracted or over-licensed. In response, the Government have said that the Environment Agency is adequately placed to review and/or change abstraction licences. We do not agree with that assessment.

In his response to their lordships’ amendments, Lord De Mauley said:

“The Environment Agency will soon use its powers to revoke or vary abstraction licences without compensation where they are causing serious damage to the environment.”—[Official Report, House of Lords, 4 February 2014; Vol. 752, c. 163.]

However, following budget cuts, the Environment Agency has cut 600 staff since 2010, so surely the Minister must concede that the Environment Agency will now have less capacity effectively to discharge its duties in that respect. What will be the priority for this smaller, rather emaciated, Environment Agency—flood defence schemes or attention to abstraction reform? Given its much reduced resource, is the Minister confident that the Environment Agency can manage all its duties effectively?

Under the new market conditions created by the upstream market reforms in the Bill, more water could be abstracted from water courses than is sustainable or suitable for local ecosystems. We support the amendment for upstream market reforms to allow new water undertakers into the market, but we still think it wise for the Government to deliver progress on abstraction reform, running concurrently.

We asked the Government to bring forward reformed abstraction licences on the same day as the upstream reform measures in the Water Bill come into effect, but they have unfortunately neglected to do so. Instead, under amendments 65 and 104, the Secretary of State is required to produce a report on progress made on water abstraction reform within five years of the Bill being passed, as the Minister indicated. We do not oppose that amendment because it is better than nothing, but it is unsatisfactory overall, because unsustainable water abstraction could continue for some time after the Bill has been passed—before DEFRA effectively addresses the issue.

In conclusion, why are the Government reluctant to commit to ensuring that the abstraction reforms run concurrently with the upstream marketing reforms? I look forward to hearing the Minister’s answer on that point.

[Miss McIntosh]

I shall make just a few comments. Over the last three years, events in Yorkshire have certainly shown the unpredictability of the weather, which can swing from a real flood to a virtual drought within a matter of weeks. The hon. Member for Brent North (Barry Gardiner), whom I see in his place on the Opposition Front Bench, and my hon. Friend the Minister sat in the Environment, Food and Rural Affairs Committee when we debated these issues—both at the pre-scrutiny stage and when the amendments to the Bill were tabled. It was a constant theme of the Select Committee to call for the implementation of abstraction reform—certainly by 2022. If I understand the Minister correctly, he is saying that this will happen within five years of the Act being passed, whereas we asked for it within seven years. It looks as if we are on course.

Personally, I would have made the case to include abstraction reform within the context of the Bill. I hope this does not come home to roost in the intervening five, six or seven-year period, but given the climatic changes and swings in weather patterns that we have seen, I hope we do not rue the day that we failed to include abstraction reform in the Bill. I understand that there was no appetite for it and that the Department felt, as I am sure the Minister will confirm, that doing so would have brought an inevitable delay to the Bill.

The reason abstraction reform should be included, and the reason I welcome this group of Lords amendments, is that the current system of managing abstraction of water from rivers and aquifers was introduced in the 1960s and is woefully out of date. It does not effectively address the severity of pressures on water resources due to increasing demands from a growing population and an increasingly varied climate. The Environment Agency has mentioned that in a number of areas, including my own, it cannot, for understandable reasons, afford the upkeep of existing flood defence banks. Farm land in those areas will be prone to future floods.

Water from rivers and aquifers has many uses, and there is a fine balance between industrial and non-industrial use. I visited the constituency of my hon. Friend the Member for Witham (Priti Patel), which I had the privilege of representing as an MEP for 10 years, to see the difficulties that many industrial users such as jam manufacturers and others experienced in a climate that they were not used to. Essex has on occasions been compared to Egypt in respect of the amount of water fall that it receives. The weakness in the current system means that it could start to constrain economic growth, reduce the resilience of the water supply and lead to environmental damage.

14:00

I would like to hear what discussions the Minister is having with the European Commission’s water unit. That used to be chaired by someone whom I count as a friend, Grant Lawrence, who was a British official who did great work for the European Union, but who was mindful of the uses of water and the competition for use between agricultural users, anglers and industrial users. Mr Lawrence left a number of years ago and since then I have been briefed on a number of occasions by the water unit, and I am struck by the fact that it does not understand our approach to water use. One reason for that, as it explains it to us, is that our rivers might seem long to us, particularly the Thames, meandering as it does through a number of counties, but compared with the Rhine and the Danube they are not. So it approaches river quality, water quality, and—dare I say?—abstraction in a completely different manner from us. When the Bill receives Royal Assent and we proceed within the timetable that my hon. Friend has set out, what discussions will he have in relation to water abstraction and abstraction reform on the reforms to the water framework directive and the other EU directives that are trundling down the river as we speak? That is important with regard to drafting and considering water abstraction reform.

I hope that my hon. Friend will again say that there will be plenty of opportunities to consult a variety of industrial users, and, obviously, I would make a bid for the Select Committee to be consulted at an early stage. I would like to make a plea for the farmers. I represent a deeply rural constituency, and there is concern among the farming community that delaying abstraction reform until 2020 or 2022 will mean that their interests are disregarded, more so in times of drought than in times of flood.

The detail of any abstraction regime will need to be developed following the Government’s consultation, which closed at the end of March, and, as my hon. Friend has set out, legislative proposals will be produced. One of the difficulties with the Bill, which I hope the water abstraction reform legislation will not suffer from, is a bane of the legislative programme. This point of the legislative Session is like midnight, and we have only one more year. I hope that we can make a plea for adequate time in the legislative programme in the next Parliament for the new regime to be introduced and properly considered.

The Opposition tabled a new clause whereby upstream reform could not have been implemented until new primary legislation on the licensing of abstraction had been passed, and they made the case for five years to elapse to allow for its implementation, and that has echoes in what the Government propose today. I would have preferred the new clause that we moved on Report to have seen greater favour, but I take this opportunity to welcome today’s amendments.

It is appropriate to raise water efficiency in terms of abstraction and the environmental protection measures that my hon. Friend set out. The Water Industry Commission for Scotland raised concerns throughout the Bill’s passage that retailers should focus on offering water efficiency advice and other environmental services as opposed to companies being encouraged to cherry-pick customers to the detriment of the generality of an incumbent’s customer base. The amendments that I understand came from WICS were not successful, but they sought to remove the link between the proposed wholesale authorisation and the proposed retail authorisation, by requiring those with wholesale authorisations to interact with water companies rather than retailers, and further that Ofwat would be under an obligation, among other things, to set charging rules in a way that helps to incentivise water efficiency and other services. The Government resisted those amendments, but they go to the heart of what the hon. Member for Penistone and Stocksbridge (Angela Smith) said about the background reports that have seen fruition in this group of amendments, in particular the Anna Walker report on water efficiency. Each and every one of us has a role to play by not heating more water than we need and not running water while we clean our teeth, all of which have an effect. I hope my hon. Friend will have some regard to the powerful arguments that have been made when we go on to consider greater efficiency and in the context of abstraction reform.

[Dan Rogerson]

Once again, I thank hon. Members for their contributions. It is fair to say that we have a great deal in common, although with slightly different emphases in aspects of debate both today and during previous outings. The crucial issues concern the interaction between what is in the Bill and what is not with regard to abstraction reform and the parallel process, so I take this opportunity to reassure the House that the Government are fully committed to abstraction reform, as our amendment tabled in the other place demonstrates.

Further illustrating that commitment, the Government’s consultation on our proposals for reform of the abstraction regime closed on 28 March. We are analysing the responses, a summary of which we will publish later this year. The proposals in our consultation document demonstrate how seriously we take abstraction reform, as well as the complexity of reforming such a long-established regime. As has been said, it is crucial that we get that right and give people an adequate chance to express their opinions and for those to be taken into account. Our proposals reflect how important abstraction reform is for people, as well as for the environment, and the fact that organisations and individuals throughout the country need access to water to run their businesses.

The Government want to see a real improvement in the quality of water bodies throughout the country, and that means that we must take action to reduce over-abstraction that damages the environment now, while continuing to protect the environment and ensuring access to water in the more challenging conditions that we will face in the future. Abstraction reform and upstream reform are both designed to help to achieve that goal. The intention is for them to be entirely complementary, both in design and in implementation. Both are part of the Government’s wider agenda for securing the long-term resilience of our water supplies and the water environment, as set out in the water White Paper. The upstream reforms in the Bill are important because they will build resilience in the sector, bringing in new thinking and innovation to drive efficiency. Upstream reform will help to keep bills affordable and benefit the environment. We estimate that these reforms will bring benefits of up to £1.8 billion over 30 years.

As I have said, the report to Parliament on progress with abstraction reform will provide the opportunity to update Parliament on the preparations for the implementation of both abstraction reform and upstream reform, and how the two are being closely aligned. There is therefore no question about our commitment to abstraction reform, and no case for delaying implementation of our upstream reforms.

On the points made by the hon. Member for Penistone and Stocksbridge (Angela Smith), we are carrying on the process begun by the previous Government of looking at the reform issues, and we seek to demonstrate that this is an ongoing commitment. There is much support across the House for taking these matters forward, so we can have confidence that the two processes can be aligned.

We considered the sustainable development duty in depth. The Ofwat review recommended that that not be included because it was not necessary. I have sought throughout to make the point that we can integrate the desire for sustainability in the resilience duty, and that is what we did during the Bill’s passage through this place. That move was welcomed by the non-governmental organisations that originally called for the sustainable development duty. In another place we have further drawn out the emphasis on water efficiency. Water efficiency is important not just for environmental reasons—although they are crucial and we want to see the responsibility to improve environmental quality returned to water bodies—but to ensure that we have the water resources that we need to deliver the growth in the economy, allow businesses to grow and to prosper, and deal with the challenges that we face in the future.

Another issue that was raised was the capacity of the Environment Agency to use the powers that it has now and to take forward the regime without compensation. The hon. Member for Penistone and Stocksbridge rightly said that that capacity is now at its disposal. Indeed, the Environment Agency gave evidence to the Public Bill Committee and was quite clear that it has the resources to undertake such duties. It has been undertaking work to return water to the environment to bear down on unsustainable abstraction, and it will continue to do that. It is something on which it will remain focused. This is crucial in respect of our consideration of sustainable development in that, unlike other regulatory regimes, there are multiple regulators of the water sector. We have the Environment Agency, which has a great focus on that particular activity, Ofwat and the Drinking Water Inspectorate. The regime is slightly different from that in other utilities.

My hon. Friend the Chair of the Select Committee was right to make it clear that we need careful consideration of the abstraction reform process, and it is very much the Government’s position that we will provide the opportunity for such work. Were we simply to have put in the Bill some sort of broad enabling power, it arguably would not have had the consideration that it will get as primary legislation in a future Bill, and that is absolutely right in terms of taking forward that process. On that basis, I hope the House will support the amendments made in another place.

Lords amendment 1 agreed to.

Lords amendments 2 to 14, 31, 34 to 42, 65, 66 and 104 agreed to.

Clause 51

The Flood Reinsurance Scheme

[Dan Rogerson]

I beg to move, That this House agrees with Lords amendment 67.

[Madam Deputy Speaker (Dawn Primarolo)]

With this we may take Lords amendments 68 to 100, 105 and 106.

[Dan Rogerson]

This group of amendments is mainly to do with flood insurance measures, and includes the Government’s response to the recommendations on flood insurance from the Delegated Powers and Regulatory Reform Committee. It also includes a small number of minor changes.

Lords amendments 70, 75, 81 to 83 and 91 to 95 are in response to the Delegated Powers Committee’s recommendations on the flood insurance measures. The amendments include changing the scrutiny procedures so that the affirmative resolution procedure is used for all regulations—in certain cases on first use only—and placing some definitions in the Bill.

We agree with the Delegated Powers Committee that the definitions are important. However, it was not possible to include all of them in the Bill as they require further consultation and, in the case of “relevant insurer”, have separate meanings for Flood Re and for the flood insurance obligation—the alternative proposal. By defining those terms in regulations that will be subject to the affirmative procedure, Parliament will be able fully to scrutinise these definitions in due course.

The Delegated Powers Committee also recommended that the powers to make regulations to provide for the sharing of council tax data should be subject to the affirmative procedure. However, to meet the commitment to establish Flood Re in 2015, we need to release the council tax information as soon as possible after Royal Assent to ensure that IT systems can be put in place. Lords amendments 77 to 79 place that data-sharing power in the Bill. I hope that hon. Members will see that that is necessary owing to the challenging timetable to deliver Flood Re. Lords amendments 74, paragraph (ab) to amendment 93 and amendment 100 make consequential changes based on the new power. Although that power does not mandate the release of data, the Government are committed to doing so. They also give a power to add to the list of data releasable in the future. If we do that, the powers also allow for the application of a criminal sanction—for example, where the additional information is of a particularly sensitive nature warranting the protection of a criminal sanction for misuse. It is right that we have powers to protect the release of public information, but the sanction is not automatic and we will consider whether one is necessary following consultation.

14:15

I wish to turn briefly to another Lords amendment on the subject of Flood Re’s reserves. To ensure that the power set out in clause 54 cannot compromise the sound operation of Flood Re and its orderly management, a small change was made to make it clear that the scheme administrator’s consent is to be sought first if regulations are proposed to be made requiring reserves to be paid to Government. That consent means that the scheme administrator is able to object to any prudentially unsound proposals, as well as to make representations on the retention of some or all of the reserves; consequently, there is no longer a need to consult the Prudential Regulation Authority as well. Members can be assured that the Prudential Regulation Authority will continue to be closely consulted on this and all other regulations made in relation to the Flood Re scheme.

Lords amendment 72 allows the Secretary of State to require Flood Re, through regulations, to provide information for relevant insurers to pass on to their policyholders who will benefit from Flood Re. We expect the information to cover the Flood Re scheme, flood risk and the actions householders can take to reduce the risk and impact of flooding.

[Andrew Percy (Brigg and Goole) (Con)]

I am intrigued by and interested in this amendment, not least because so many of my constituents—perhaps the majority of them—live in flood-risk areas. Will the Minister say a little bit more about what he envisages the Secretary of State will require to be provided to residents in terms of mitigating risk? This is an interesting idea, but my question is about the breadth of that information and whether it will include particular providers of certain solutions.

[Dan Rogerson]

The first thing that will be taken forward is information that a policy has been ceded to Flood Re. It is important that people should know that, as the scheme has a life span and the whole direction of policy is to protect more homes and to move to a post Flood Re period in due course. What exactly that information will take forward is a matter for discussion with the industry. When it comes to particular technologies or particular things that may help in certain circumstances, there are experts out there who offer that advice to policyholders. The Government’s current repair and renew scheme is in operation. There is also a body of work out there involving local authorities, which is giving people confidence in what might be done to support them. It is not our intention to be too specific as we consider this measure in the Bill.

I am sure that, like my hon. Friend, other Members will welcome this amendment, because it reflects our belief that it is important that policyholders whose buildings, contents or combined insurance policy are ceded to Flood Re know about their flood risk so that they can take simple steps to manage it. I am talking about signing up to free flood warnings as well as investigating other longer-term options.

To plan for the future, households also need to understand the likely impact of the transitional nature of the Flood Re scheme which is subsidising their premiums. Members should note that it is expected that standardised information will be sent to the customer by the relevant insurer that is ceding the policy to Flood Re, as that maintains the relationship between insurers and their customers.

Lords amendments 84 and 85 provide the power to define in regulations the meaning of “flood” and “flood risk” and are as a consequence of the amendment that I have just described.

Lords amendment 96 addresses the risk that secondary legislation made at the end of the life of Flood Re could be classed as hybrid. I can assure Members that, in any event, we have every intention of carrying out a full consultation before making that secondary legislation to ensure that any private interests are properly considered.

There are also a small number of technical changes made by the Lords amendments to the Bill. They cover the definition of the “eligibility threshold” and are intended to ensure the flood insurance measure is legally enforceable, as the risks relating to flooding are not calculated consistently across the various insurers.

On another matter, the Lords amendments to clauses 56 and 71 on the period of operation of Flood Re ensure that employment contracts within the scheme are transferrable.

Turning finally to the subject of sustainable drainage systems, we have also corrected an error to schedule 3 to the Flood and Water Management Act 2010 to ensure that unused bond funds, called in by a SUDS approving body, can be returned to the right person.

[Angela Smith]

As the Minister has explained, this group of amendments relate, to the provisions in the Bill on flood reinsurance. Again, we will support the amendments, which we believe have materialised primarily because of pressure from a wide range of Members in the other place and from the official Opposition. However, we believe that more could have been done.

In many ways, this is yet another example of a missed opportunity to produce effective and robust legislation. We support the Flood Re scheme and believe that it is important that affordable cover is made available for those who are struggling and are at greatest risk from future floods. It is also important that the policy should be underpinned by the principle of minimal impact on wider bill payers, so it is important that the levy agreed between the Government and the industry remains equivalent to about £10.50 for each UK household with both buildings and contents insurance in place.

We also welcome the fact that Flood Re is designed to be progressive, with the benefits targeted on lower income households, but we are disappointed that the Government could not support Labour’s amendment in the other place, which would have at least enabled parliamentarians to shine a light on the potential problems created by the arrangements for leasehold and tenanted properties. As Lord Whitty pointed out, there are complicated qualifying or excluding conditions surrounding the ownership and occupation rules under the scheme.

The rules could also have an impact on the private rented market, as there is a fear that single property landlords, for instance, might find that their exclusion from the scheme means that the cost of insurance eats away at their capacity to invest in their properties. As Lord Whitty pointed out, the consequence could be increasing levels of dilapidated housing stock with potential impacts at a neighbourhood level. The only option that might be open to the landlord to raise funds for improvements could be to raise rents or the service charge, so tenants might suffer indirectly as a consequence of being excluded from the Flood Re scheme. The risk is clear: the number of new landlords prepared to invest and buy property will diminish in the areas that are affected. Given the housing crisis facing the country, that is not a welcome prospect.

Although we recognise that the actuarial calculations for Flood Re are delicate and depend on various assumptions, we feel it is important that Parliament understand, the position. Labour’s amendment would address that by ensuring that a report was made available so that Parliament could see for itself the consequences of including or excluding different combinations of property before taking the Flood Re scheme forward via statutory instrument.

We also feel that the Government have failed to grasp the importance of using reliable scientific evidence on the potential impact of climate change when making estimates of the current and projected number of properties eligible for inclusion in the Flood Re scheme. That is perhaps not surprising, given that the Secretary of State has been known before now to deny the reality of climate change, but the threat, as most of us agree, is real and we need to be sure that the scheme will operate effectively within its 25-year span and will be adaptable to weather conditions resulting from climate change. If they are to adapt effectively, it is crucial that households can access information that identifies current and projected estimates of the number of people eligible for the scheme.

It is entirely sensible that we should seek the advice of the Committee on Climate Change to inform as accurately as possible our calculations on the challenges that the Flood Re scheme will face over time. Only then can households truly take the necessary action to minimise risk. The Government have tabled amendments providing information on transitioning from Flood Re to risk-reflective pricing, which Labour has been arguing for throughout the passage of the Bill.

Flood Re cannot operate on a static basis. It needs to respond to changing weather patterns, and we continue to believe that the Secretary of State should take advice from a credible expert source. Lord Krebs, chair of the adaptation sub-committee, has indicated that he would be willing to take on that role. However, our amendments, along with others on access to the national database and the right to appeal, were not accepted by the Government. We think that is short-sighted, but we support the amendments in this group and will continue to engage positively on this important issue.

[Miss McIntosh]

When we took evidence on the insurance aspects of the Bill during the Select Committee’s scrutiny stages, we were told that the package on Flood Re stood as a whole and that we could not consider any exceptions—not small businesses or leaseholders, or anything else, and certainly not band H. I hope that my hon. Friend the Minister will permit me a wry smile as I see that some of those exceptions have been included.

I hope that my hon. Friend will clarify the position on leaseholders. I—like many others, I am sure—have been contacted by constituents asking me to consider the implications for an owner who buys a leasehold property, as my constituents did in their block of flats. Apparently, the cost under Flood Re of the flood insurance alone will run to thousands of pounds, which they cannot afford and which they believe will affect their ability to resell those properties. I would be grateful for an explanation of where we are on that.

I understand that my noble Friend Lord de Mauley confirmed in the other place that domestic contents policies will be available to all under Flood Re, regardless of whether the properties are leasehold or freehold, rented or owned-occupied, except for properties in band H and those built since 1 January 2009. I have seen on many of my flood visits around the country that tenants on low incomes are often the first not to take out an insurance policy for their contents. The cost is therefore greater when they have to replace many of their possessions, some of which are of course priceless and cannot be replaced. Will domestic contents policies indeed be available to all?

Will my hon. Friend the Minister confirm the intention behind the exception for band H properties? It seems bizarre. We are going to exclude from Flood Re leaseholders who are perhaps on lower incomes and often in smaller, more affordable properties, but people in band H tend to be wealthier and in a better position to afford insurance. I want to understand the situation so I can explain to my constituents why these exceptions have been considered.

I know that the date of 1 January 2009 was taken as the benchmark, but did the Department ever look closely at why that was a good date to choose? With hindsight, should it perhaps have been 1 January 2012 or 1 January 2013, when we first began closely to scrutinise these issues through the proposals from the Department and the work of the Select Committee and others in this place?

It would also be helpful to understand the position for small businesses, particularly farms. If the farmhouse itself has been flooded, will that be covered in the provisions of Flood Re?

14:29

The greatest concern—I am sure the Minister will recall that I raised it earlier—remains that the Government may end up as an insurer of last resort because Flood Re will not cover a one-in-200-year or one-in-250-year event. We found out that the winter floods in 2013-14 were a one-in-200-year event, so it will be sooner rather than later that the Government will end up as the insurer of last resort. The House will be interested to learn what provisions the Treasury has in place if that occurs earlier than might have been assumed, because there will not be money in the pot if the winter floods are repeated in the autumn of 2014 and 2015.

The hon. Member for Penistone and Stocksbridge (Angela Smith) raised an interesting issue that we discussed in Committee. The evidence we took was that the subsidy was then £8.50. It has already gone up to £10.50, and we need an assurance from the Minister that there will not be an open remit to the insurance industry and that the level of subsidy will be reasonable. Before the Bill leaves this place today, the Minster should comment on what the Treasury has in place were the Department and the Government to be an insurer of last resort.

I have two more issues pertaining to this group of amendments. One concerns regulated as opposed to negotiated access. Amendments were proposed to make it clear in the Bill that access should be regulated, not negotiated. The amendments were unsuccessful, but I understand that the Department has given a commitment that access terms should be regulated. Can the Minister give a commitment today that that will be in the regulations that will give effect to the Bill?

An issue that caused great concern in our pre-legislative scrutiny in Committee and later was the de-averaging of charges. Concern was raised about the risk of a competition or EU challenge to the Department’s guidance or Ofwat’s implementing rules on harmonised or regionally averaged wholesale charging, which could result in a forced de-averaging of charges. My understanding is that that could be seriously bad news for rural areas and I would like the Minister to put my mind at rest. Amendments were proposed to address that risk, but the Government did not accept that the risk existed or, if it did, that the existing provisions in the Bill were not adequate to address it. Any de-averaging of charges that might arise through the application of the Bill would be highly regrettable. Otherwise, I welcome this group of amendments, but I hope that the Minister can put my mind at rest on the concerns I have raised.

[Andrew Percy]

I intend to make only a short contribution. The Minister probably heard most of what I said in Committee, but if something is worth saying once, it is worth saying three times, so I will do so.

I begin, as I did in Committee, by welcoming Flood Re, which is important. I pay tribute to the Government for getting us here eventually. It is incredibly important for my constituents and those of my near neighbour, my hon. Friend the Member for Beverley and Holderness (Mr Stuart), who is here for this important debate. I am grateful and delighted that we have a scheme up and running to ensure that insurance cover will continue.

I am still concerned about the scheme’s limitation to properties built before 2009—a point that is often made by my constituency near neighbour, the hon. Member for Kingston upon Hull North (Diana Johnson). Many people in my constituency and constituencies nearby who bought their properties in good faith post-2009 have struggled to obtain insurance. I am still concerned that major developments on flood plains are continuing, including the Lincolnshire Lakes project near the River Trent in my constituency, where the proposal is to provide up to 10,000 properties in a major flood risk area on the River Trent’s natural flood plain. I have called on the developers to put a hold on that until we know where we are with flood defence funding for the Humber catchment area, but unfortunately that has not enjoyed the support of local Labour councillors, who accused us of scaremongering in trying to prevent that building on a flood plain. That is a concern because I am worried that the properties will be built but will not be covered by Flood Re and that there will be a whole set of other problems.

When I was in my constituency on Friday, visiting Hook church, which was launching its new heritage boards, I was approached by a single-property leaseholder who is concerned about whether he will qualify for Flood Re. He is not a major investor, but an individual who is using the property as a pension pot. He has been rejected for flood insurance yet again because of the flooding in Goole two years ago, and he is worried that he will not come within Flood Re. I echo the words of my hon. Friend the Member for Thirsk and Malton (Miss McIntosh) about the need for clarity.

I welcomed amendment 72 when I intervened on the Minister. Informing residents that they are indeed part of Flood Re and providing practical advice on their exact flood risk and how they can deal with it are important. The Minister mentioned the renewal and repair grant, which is an excellent proposal. Providing people with the means and advice on how to protect their properties is important, and funding is required. Whether or not there is funding, there is a big job to be undertaken to ensure that residents are properly informed about their flood risk and how they can protect their properties.

Many residents have it in mind that the only way to protect their property is through every-increasing defensive banks in our area, and that may be true, but it is not the answer to everything, particularly as my constituency is so low-lying. Much of it is below high-tide level, so it is impacted not only by tidal and river flooding, but by surface water flooding. Getting information to residents to ensure that they know how to protect their property is vital. I welcome amendment 72 and look forward to establishing in more depth what information will be provided on flood mitigation measures.

The Minister mentioned the renewal and repair grant. I hope that it is in order, Madam Deputy Speaker, to raise that while I am on my feet. Many of my constituents are trying to use the grant, but there seems to be confusion about whether they will be able to access it if the Environment Agency has come up with community improvement schemes. That is a particular issue for one of my communities because the Environment Agency, after pressure from many of us, has come forth with a scheme that will be in place next year to raise defensive banks at Reedness in North Yorkshire. It is not now clear whether those properties will be eligible for a renewal and repair grant. They will still be at risk of flooding and, in the spirit of amendment 72, which is about providing people with more information on how to protect their properties, it is important that they still have access to the grant. It is not their fault that their improvement scheme will come forward more quickly than other schemes. I hope, Madam Deputy Speaker, that I am in order by linking the matter to amendment 72. I can see from that near-thumbs up that I am straying, so I shall move on.

Right of appeal is another issue that I spoke about in Committee. We need a mechanism of appeal for residents who are judged to be outside Flood Re. We know from the debates in Committee and elsewhere that that will be a very small number of people, but they are an important group all the same. It is important to have a mechanism that allows people to understand why they have been drawn outside the scheme, and they should have a right of appeal. Like my hon. Friend the Member for Thirsk and Malton, I ask Ministers to consider this.

I do not want to say much more. [Interruption.] I hear some chuntering from Opposition Front Benchers—in support of my last comment, I hope. If the hon. Member for Penistone and Stocksbridge (Angela Smith) wants to intervene, I will gladly give way. No? Okay.

[Maria Eagle (Garston and Halewood) (Lab)]

Sit down!

[Andrew Percy]

The hon. Lady tells me to sit down; that is a good way to work cross-party, if ever there was one. I will heed her advice, however.

I hope that the Minister will be able to respond to those few comments, particularly on leaseholders. This is an important issue for residents who have made small investments for their pension pots, or in lieu of a pension pot, and who may now be drawn outside the scheme. Other than that, I support the scheme and the amendments outlined by the Minister.

[Dan Rogerson]

I thank all hon. Members who have contributed to this debate, across a broad range of issues, and welcome their questions.

All three Members who spoke mentioned leaseholders. Let me put on record again the point alluded to by my hon. Friend the Member for Thirsk and Malton (Miss McIntosh). All contents policies would be eligible for Flood Re, whether leasehold, freehold, rented or owner-occupied, provided that the properties were built before 1 January 2009 and are in council tax bands A to G. Leasehold houses will also be within the scope of Flood Re in terms of buildings insurance, provided that the leaseholder lives in the property and purchased the buildings insurance in their own name. Flats will be eligible provided that there are no more than three flats in the building and that the freeholder, or one of those with a share of the freehold, lives in the building and takes out the cover.

[Miss McIntosh]

My hon. Friend says that the scheme applies if there are no more than three flats in the building. Where we lived—the current residents now have the problem—there could be 12, 16 or 20 properties. These are small properties that tend to be more affordable and occupied by those with a mortgage. Residents have put it to me that the increases are unaffordable already. Insurance companies are extracting those increases from them when they renew their insurance policies in an area that they know has already been flooded at ground-floor level because of the properties’ proximity to the river. I urge the Government to revisit this, because it is not acceptable. I do not want to pander to the Opposition’s argument about the standard cost of living, because that would be inappropriate, but I do believe that the Government should make the insurance affordable by reducing the cost. They should take out the below-three number because they have to reflect what working families are living in.

[Dan Rogerson]

We believe that a significant proportion of the leasehold sector will fall within the scope of Flood Re if the properties are at the highest levels of flood risk. I should emphasise, however, that we expect that most properties will not need to be in Flood Re and will find better prices through normal routes. We have been assured that there is no evidence of a systemic problem with freeholders being unable to obtain insurance for their leasehold properties. Specifically, feedback from members of the Association of British Insurers, representing over 60% of the market, including specialist commercial property insurers, showed no expectation of a widespread issue in an open market. As for the small businesses that are outside the scope of Flood Re, we and the ABI will monitor the market over time.

14:45

My hon. Friend the Member for Thirsk and Malton raised a number of other issues, including small businesses, as she has done before. It is important to focus on the fact that the scheme is for residential properties, not for the commercial insurance market. Commercial cover tends to be far more bespoke and of a different nature to the policies that householders usually have. This is relevant to her point about the levy that is paid into the pot. In seeking to add to that pot in terms of what is paid out and the level of risk, we would have to add to what everyone else is paying for. We think that the balance is right and that the level of a more transparent cross-subsidy—there is already a cross-subsidy within the market that has been more hidden—is focused on household policies and not on commercial policies. The danger is that, once we start to get into the more commercial arena, we are then asking for a cross-subsidy from householders to commercial landlords. We therefore think it important to draw this line. Landlords already benefit from tax relief on the cost of their buildings insurance policies. They can offset many of their costs through taxable allowances that can significantly reduce their tax bill—to zero, in some instances. The hon. Member for Penistone and Stocksbridge (Angela Smith) referred to this being more progressive, and I welcome her support. That is one of the reasons why we have had the scheme structured as it is.

My hon. Friend the Member for Brigg and Goole (Andrew Percy) mentioned properties built after 1 January 2009, as did my hon. Friend the Member for Thirsk and Malton. This is in line with the prior agreement with the industry. As I am sure my hon. Friend the Member for Thirsk and Malton is aware, that is where the date comes from, so it should not come as a surprise to those constructing properties in flood risk areas. It is a pre-existing cut-off date that we have carried forward into the new arrangements. As my hon. Friend the Member for Brigg and Goole pointed out, properties built after 1 January 2009 should have been constructed in line with national planning policy and should therefore be resilient to flooding and able to access affordable insurance. Maintaining this approach under Flood Re will help to ensure that new development is appropriate and resilient to flooding. That covers the points made by my hon. Friend the Member for Thirsk and Malton about the levy, in which I have confidence. We have to make sure that we base it on existing assumptions and do not seek now, at this late stage, to add other potential draws on the reserves of Flood Re and the scheme as a whole.

Flood Re will be an authorised insurer operating under the requirements of solvency II. Insurers must hold capital reserves that can be used to cover the cost of a catastrophic event. To assess the required capital reserves, insurers must keep their detailed catastrophe models up to date, including any changes in levels of insured risk such as from climate change. Flood Re will need to take account of climate change as part of its regulatory obligations in ensuring that it remains solvent over time. We therefore expect it to seek the best available advice on climate change, including external verification of its assumptions. Detailed audited information about Flood Re’s ongoing operation will be reported to Parliament on a regular five-yearly basis. Parliament will have the opportunity to vote on the levy and the eligibility thresholds of the scheme. I assure colleagues that the impacts of climate change will be considered during the entire lifetime of the scheme to ensure that Flood Re is resilient to changes to flood risk.

I would like to reassure my hon. Friend the Member for Thirsk and Malton about one-in-200-year events and what we experienced during the winter flooding this year. Although she may be right to point out that we had the wettest January in about 250 years, that does not equate to a one-in-200-year flood event; they are different things. As we have heard from hon. Members in several debates over the past few months, the effects of flooding are extreme for the families and businesses affected, but because about 8,000 properties were affected during the recent winter floods, we were nowhere near triggering the sorts of events that she mentioned. Should a one-in-200-year event occur, however, we have been clear that the Government have no direct liability. The Government would take primary responsibility for deciding how all available resources would be used, but the Government are not an insurer of last resort in that they do not have financial liability for Flood Re.

[Miss McIntosh]

Will my hon. Friend hark back to the evidence the Select Committee heard from the insurance industry during pre-legislative scrutiny? We were told categorically that, if there is a one-in-200-year event, the pot into which the subsidy will be paid, on which we all agree, will not be sufficient to pay out the resources, and it is generally accepted by the insurance industry that the Government will step in. Perhaps that is a different phrase from the one that my hon. Friend might use, but it means that the buck stops with the Government.

[Dan Rogerson]

We have been absolutely clear that, in such an event, the resources from the Flood Re pot would be significant and the Government would be involved in discussions about how that money would be used to help the people affected.

Although we have been focusing on Flood Re, my hon. Friend also asked about de-averaging. I want to use this opportunity to put on the record the fact that the Government’s charging principles on de-averaging are unambiguous. Ofwat must not allow de-averaging that is harmful to customers, particularly rural customers. Our charging guidance will follow soon. I am happy to commit, as I have before, to making it plain in that document that there must be strong, definitive boundaries for the scope of any de-averaging and that households in particular must be protected.

We should not, however, be over-simplistic. There is no doubt that there are areas where better cost reflectivity could have substantial benefits for the environment and the resilience of our water supplies. It must be right that the new upstream markets should reflect the environmental costs of supply and that there are economic incentives for business users that use large volumes of water.

My hon. Friend the Member for Brigg and Goole asked about the operation of current Government grant schemes. It might not be appropriate to go into that in detail now, but I would be happy to respond to correspondence from him on the specifics of how the scheme in his area is working.

I thank hon. Members for their contributions to our debates on the Bill today and at various other stages in this and another place. I hope that the House will agree with their lordships’ amendments.

Lords amendment 67 agreed to.

Lords amendments 68 to 100 and 105 and 106 agreed to.

Immigration Bill (Money) (No. 2)

Queen’s recommendation signified.

Resolved,

That, for the purposes of any Act resulting from the Immigration Bill, it is expedient to authorise the payment out of money provided by Parliament of any expenditure incurred under or by virtue of the Act by a statutory body or recognised charitable organisation.—(James Brokenshire.)

Immigration Bill (Programme) (No. 2.)

Motion made, and Question put forthwith (Standing Order No. 83A(7)),

That the following provisions shall apply to the Immigration Bill for the purpose of supplementing the Order of 22 October 2013 (Immigration 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 three hours after their commencement at today’s sitting.

(2) The proceedings shall be taken in the order shown in the first column of the following Table.

(3) The proceedings shall (so far as not previously concluded) be brought to a conclusion at the times specified in the second column of the Table.

Immigration Bill

Wednesday 7th May 2014 Commons Chamber

Consideration of Lords amendments

[Madam Deputy Speaker (Dawn Primarolo)]

I must draw the House’s attention to the fact that financial privilege is involved in Lords amendments 7, 16 and 24. If the House agrees to any of these amendments, I shall ensure that the appropriate entry is made in the Journal. I should also tell the House that Mr Speaker has selected the five manuscript amendments tabled today by the hon. Member for Brent Central (Sarah Teather). Copies are available in the Vote Office.

Clause 60

Deprivation if conduct seriously prejudicial to vital interests of the uk

14:54

[The Minister for Security and Immigration (James Brokenshire)]

I beg to move, That this House disagrees with Lords amendment 18.

[Madam Deputy Speaker]

With this it will be convenient to take Government amendments (a) and (b) in lieu of Lords amendment 18.

[James Brokenshire]

The fundamental duty of any Government is to protect the British public and maintain the security of the UK against a range of threats. There is a small but very dangerous number of individuals who, despite having taken an oath of loyalty to become a British citizen, seek to threaten the security of this country. Those same dangerous individuals seek to exploit a loophole in our legislation preventing us from removing their citizenship if it would render them stateless, even temporarily, while they reacquire their former nationality. This Government have sought to address that issue, in line with our international obligations to protect the security of the UK.

Our proposals, previously debated in this House on 30 January, sought to extend the existing deprivation powers of the Home Secretary so that a naturalised British citizen who has conducted themselves in a manner seriously prejudicial to the vital interests of the UK—I underline the high bar that has been set—can be deprived of their citizenship, regardless of whether it would render them stateless. We believe that is vital for the security of the UK and an important point of principle. It is not right that people who subvert our values and fight against our armed forces should invoke our protection and enjoy the privileges of British citizenship.

Many of the debates on this issue have focused on the use of the existing powers in the UK and overseas. I remind right hon. and hon. Members that the Home Secretary has long-standing existing powers to deprive a British national of their citizenship where that individual acquired it using fraud or where she is satisfied that doing so is conducive to the public good. Where fraud has been used, a decision can be made to deprive, which leaves a person stateless. Our proposals have built on the non-conducive powers to target a narrow cohort of naturalised Britons who are a real threat to our national security.

[Sarah Teather (Brent Central) (LD)]

Is the Minister able to clarify the numbers involved and how the Secretary of State and, indeed, her predecessors have used those powers? The Joint Committee on Human Rights has repeatedly asked for those data, but has been unable to access them. I have asked similar questions and have also been unable to get the data, so could the Minister tell us how many people have had the power used against them?

[James Brokenshire]

It might be helpful if I explain that since the law was changed in 2006, 27 people have been deprived of their citizenship through different conducive powers. Twenty-six people have been deprived on the grounds of fraud, false representation or concealment of a material fact, and one further person has been notified of the intention to deprive on those grounds. Perhaps that gives my hon. Friend an idea of the context in which the power is used. It is used extremely sparingly: it is not undertaken lightly and the Secretary of State considers its use extraordinarily carefully.

I recognise that the proposals that were suggested when the Immigration Bill was last before this House have, rightly, provoked a great deal of debate and discussion. It is important that the House understands the significance of the measures and that the other place has had an opportunity to consider them after our debate on Report. There has been much debate, both here and in the House of Lords, about the impact of leaving a person stateless, and there are concerns about those who cannot acquire another nationality.

15:00

Although the Government are confident that our original proposals would have affected only a small number of people—given the pre-existing utilisation of the power and the high hurdle that needs to be cleared, most people would have been able to acquire their former nationality or another—we are now seeking to address the concerns expressed about leaving individuals permanently stateless and with no recourse to another nationality. Our amendment (a) provides that deprivation of nationalised citizens under clause 60 can take place only when the Home Secretary has reasonable grounds to believe that, under the laws of a country or territory, an individual is able to become a national of that country or territory.

[Dr Julian Huppert (Cambridge) (LD)]

Amendment (a) is certainly a helpful move on some, if not all, the concerns, but how will the provision be interpreted? For example, if somebody who is not a British citizen leaves another country and would otherwise have claimed asylum in this one, will that factor be taken into account? Will the Home Secretary be able to take into account the idea that a country may refuse to give citizenship because we had taken away their British citizenship? How will she make it work in practice?

[James Brokenshire]

It may be helpful if I say that the Home Secretary will consider the relevant nationality laws of a person’s country and that person’s circumstances, and she will make a decision based on whether, under those laws, the person is able to acquire another nationality. The test is whether there is a route under the law, but she will have regard to other considerations—for example, about practical or logistical arrangements. Those considerations will obviously vary from case to case, but she will consider them in forming a view. We have reflected that in the concept of the reasonable grounds. The Home Secretary will need to be satisfied about those reasonable grounds in determining whether the proposed power can be utilised.

[Pete Wishart (Perth and North Perthshire) (SNP)]

What happens if no other nationality is available? Does the Home Secretary simply give up?

[James Brokenshire]

The hon. Gentleman clearly makes the point about what we are seeking to achieve in respect of the concerns highlighted in the House and elsewhere, which is that if the Home Secretary cannot satisfy herself on reasonable grounds that the individual can acquire the citizenship of another state, she will not be able to use the power.

In this context, we are seeking to address the specific issue highlighted by the Supreme Court in the al-Jedda case, with which many right hon. and hon. Members are familiar. The case showed that the existing law was well within our international obligations, but we are seeking to act on the Supreme Court’s statement in that case about how to address the issue appropriately. We judge that the proposed provision is an appropriate mechanism for guarding our national security. It will ensure that what appears to be a loophole identified as a consequence of the al-Jedda case is not open to abuse and, building on the existing deprivation powers, it will therefore ensure that our national security is properly protected.

[Several hon. Members]

rose—

[James Brokenshire]

Various people are attempting to catch my eye. I give way to my hon. Friend the Member for Forest of Dean (Mr Harper).

[Mr Mark Harper (Forest of Dean) (Con)]

I am listening carefully to what my hon. Friend is saying, and the House should realise that he is simply putting the law back to its position before it was changed by the previous Government. I listened carefully when we debated the issue on Report, and many of the concerns involved people who have no recourse to citizenship elsewhere being left permanently stateless. Government amendment (a) deals with the very real concerns of many hon. Members. It is a very welcome move that should be supported.

[James Brokenshire]

I am grateful to my hon. Friend for his intervention. I pay tribute to him for his work on the Bill and for the steps he took, quite properly, to consider not only this issue, but the provisions more broadly. We will no doubt move on to those provisions in considering the Lords amendments. My hon. Friend highlighted the fact that the law was changed in 2002. In many respects, we are seeking to bring the law back more closely to the pre-existing position. The law was changed in 2002, and changed again in 2006. There is, therefore, a long history, with clear precedents to setting provisions that comply with our international and UN obligations on statelessness.

[John McDonnell (Hayes and Harlington) (Lab)]

I want clarification about what the reasonable grounds are. Amendment (a) could be interpreted to mean that someone has to prove that no country or territory on the globe is willing to accept them as a citizen. That cannot be the interpretation of reasonableness in this amendment, can it?

[James Brokenshire]

The hon. Gentleman needs to understand that the particular concern—the gap that has been identified—relates to someone with dual nationality who surrenders their second nationality to prevent the deprivation provision from applying to them and to prevent the Secretary of State from using the powers as she can now do for dual nationals. The Home Secretary needs to consider such factors in considering whether she is satisfied that the relevant test set out in amendment (a) has been met. She would need to show such reasonableness, and that reasonableness might be tested in the courts, because whether her determination was reasonable would be justiciable or challengeable in the courts.

[Several hon. Members]

rose—

[James Brokenshire]

I can see that my hon. Friend the Member for Brent Central (Sarah Teather) wants to make a second intervention, and I will then give way to my hon. Friend the Member for South Swindon (Mr Buckland).

[Sarah Teather]

I want to follow up the Minister’s answer to my hon. Friend the Member for Cambridge (Dr Huppert). The Minister said that the issue was about having a route in law to secure another citizenship, but he rather glossed over the practical barriers that many people face in obtaining another citizenship. Will he put on the record more information that might help those of us with concerns about amendment (a), as drafted, particularly about what constitutes an objection to the Home Secretary proceeding in relation to practical impediments to such people gaining another citizenship, rather than the provision necessarily being used as a route in law?

[James Brokenshire]

As I have said, the primary consideration is for the Home Secretary to research various materials and determine whether the individual could reacquire their former nationality, because that is what we are largely talking about in the circumstances of considering such laws. I am sure that she would also have to consider practical issues and the other surrounding circumstances. It is difficult to be specific, as individual facts and cases will no doubt be relevant to the provision. She will, therefore, wish to consider those other practical or logistical arrangements as part of her determination about whether there are reasonable grounds for the individual to secure citizenship from another state.

[Mr Robert Buckland (South Swindon) (Con)]

I want to press my hon. Friend on justiciability. Is he now satisfied that amendment (a) deals with the convention issue about deprivation of citizenship not being exercised arbitrarily, but proportionately? Does the amendment meet such tests?

[James Brokenshire]

Yes. My hon. Friend rightly points to article 15 of the universal declaration of human rights, which makes a point about protection against the arbitrary deprivation of nationality. We are very clear that the provision is not arbitrary. It is a very focused and proportionate power that meets not only those requirements, but our obligations under the UN convention on the reduction of statelessness of 1961, and the declaration made by the UK when it ratified that convention in 1966. We have considered our international obligations very carefully. We believe that the provision absolutely complies with the obligations that we have set for ourselves.

[Fiona Mactaggart (Slough) (Lab)]

All the examples that the Minister has used relate to cases in which he expects people to reacquire a nationality that they gave up to avoid having their British nationality taken away. If that is his intention, would it not have been better to table a much narrower amendment in which that was the circumstance in which the Home Secretary could consider withdrawing a person’s citizenship? That might have been more broadly welcomed in the House than amendment (a).

[James Brokenshire]

Amendment (a) was carefully framed and consideration was given to the comments of the Supreme Court in the al-Jedda case. Indeed, the amendment is more tightly framed than was suggested by the Supreme Court and is required by our obligations under the ratifying declaration that the UK signed in 1966. That speaks more widely about reserving the right in relation to statelessness, including where the person has conducted themselves in a manner seriously prejudicial to the vital interests of the UK.

We have refined those broad terms in amendment (a) by requiring the Home Secretary to undertake the reasonableness test that I have highlighted. She must have reasonable grounds for believing that the individual whom we are seeking to use the powers on has the ability to obtain citizenship under the laws of another state. I argue that we have considered the matter carefully and framed the amendment appropriately to deal with the significant loophole that was created and that was highlighted by the al-Jedda judgment. We believe that it is important to close that off in the interests of national security.

[Several hon. Members]

rose—

[James Brokenshire]

A number of my hon. Friends are trying to intervene. I give way to my hon. Friend the Member for Aldridge-Brownhills (Sir Richard Shepherd), who has not intervened on me thus far.

[Sir Richard Shepherd (Aldridge-Brownhills) (Con)]

I am very grateful to the Minister. This proposal is predicated on the fact that the Home Secretary will act rationally and reasonably, but—[Laughter.] No, I do not see that as funny at all. I want to know how the people of Britain will know that the action has been taken in a rational and reasonable way, when it is obscured from public view, and is therefore challengeable.

[James Brokenshire]

I will make two points in answer to my hon. Friend. First, the decision of the Secretary of State would be reviewable by the courts. It would, therefore, be open to the individual to challenge the decision and the reasonableness of the Home Secretary’s determination. Secondly, I point him to amendment (b), under which there will be an independent review of the power, which will report after one year and then on a rolling three-yearly basis. That will provide clarity about how the power is being used and give the reassurance that he has sought to exact.

[Jeremy Corbyn (Islington North) (Lab)]

Will the Minister clarify the point that he has just made? Is he suggesting that there will be a right of appeal against a ministerial decision, or will there only be a right to undertake a judicial review, which of course would relate to process and not to the facts of the case?

[James Brokenshire]

There is the ability to challenge deprivation decisions. Many cases have been brought before the courts that relate to the Home Secretary’s use of the existing deprivation powers. That will continue to apply for the power and the amendments relating to the specific circumstances in which someone may be rendered stateless, subject to the Home Secretary’s being satisfied of their ability to seek the citizenship of another country. The existing challenge, process and procedures will continue to apply.

15:15

[Mr Harper]

I listened carefully to the hon. Member for Slough (Fiona Mactaggart) because I respect her opinions on home affairs matters. It would not be appropriate to narrow the scope of amendment (a) in the way that she suggested. She missed the point that the individuals concerned are not always compliant and helpful in seeking a second nationality. Indeed, they often try not to do so. That is why the Home Secretary has to take a reasonable decision, taking account of the laws of the countries involved and the behaviour of the individual. If the amendment were narrowed in the way the hon. Lady suggested, I do not think that we would succeed in closing the loophole.

[Madam Deputy Speaker (Dawn Primarolo)]

Order. I remind the hon. Gentleman that the point of an intervention is not to comment on a previous intervention, but to comment on what the Minister is saying. If he wants to challenge what the hon. Member for Slough (Fiona Mactaggart) said, perhaps he will try to catch my eye.

[James Brokenshire]

I am grateful to my hon. Friend, who has made his point. I am sure that he will make it again in the debate. He is right to underline the careful way in which we have framed the amendments.

[Sarah Teather]

rose—

[Dr Huppert]

rose—

[Sir Richard Shepherd]

rose—

[James Brokenshire]

I will take one further round of interventions, then I will make some progress.

[Sarah Teather]

Will the Minister comment on the time frame in which he thinks it is reasonable to expect somebody to obtain another citizenship? In the Government’s mind, would somebody be stateless for two years, five years or 10 years? Is there any sense of how long the process could go on for?

[James Brokenshire]

That is largely in the hands of the individual. When the power is exercised, it will be open to the individual to seek the citizenship of the other country. We are unable to compel them to act in that way. That goes to the heart of the problem that we have identified. It is open to the individual to seek the citizenship of the other country, so it depends on what action they take.

[Dr Huppert]

The Minister is being very generous; I am sure that there will be questions on later sections of his speech as well. It is possible for the Home Secretary to have reasonable grounds to believe something, but for it not to be the case. What will happen if somebody in the UK goes through the process, the Home Secretary believes that they are able to get citizenship from another country and they make a bona fide application for that citizenship, but it is turned down?

[James Brokenshire]

In those circumstances, the Home Secretary would have exercised her power to deprive, so the case does not relate to the specific power under discussion. Obviously, we are able to deprive somebody of citizenship, whether they are in the UK or outside the UK, under the existing powers. That is an important mechanism for maintaining national security and ensuring that the actions of an individual who may be involved in terrorism are addressed by restricting their ability to become involved in terrorism-related activity and by preventing travel that might be a key component of terrorism-related activity. That underlines the importance of deprivation as a means of addressing the very small cohort of individuals who would seek to do us harm.

[Sir Richard Shepherd]

rose—

[Alok Sharma (Reading West) (Con)]

rose—

[James Brokenshire]

I give way to my hon. Friend who has not intervened on me before.

[Alok Sharma]

I want to press the Minister on the point that my hon. Friend the Member for Cambridge (Dr Huppert) made. If the Home Secretary has every reason to believe that an individual could get the citizenship of another country, but the Government of that country say that they do not want them as a citizen, what will happen to that individual? Will he or she remain without citizenship?

[James Brokenshire]

If the individual is in the UK, which I think is the situation on which that comment is predicated, there is precedent for giving limited restricted leave to remain. That might impose specific conditions. It would also mean that an individual would not have the usual rights of a citizen to access public services and enjoy public benefits. In seeking to mitigate the risks, that of itself may be considered a significant and relevant factor.

[Keith Vaz (Leicester East) (Lab)]

I apologise for missing the Minister’s opening remarks, which I am sure were extremely important.

I and other Members have a lot of sympathy with what the Minister says and understand and support what he is trying to do, but we are concerned about the practicalities of what will happen if he takes citizenship away from someone and leaves them stateless. That was what upset the other place. Has he studied any other country that has a similar power, and what has he gleaned from that comparative study?

[James Brokenshire]

It is difficult to make general comparisons with other states, because of the different natures of the threat that countries face, the court judgments that have been made there and the international conventions that apply to them. However, other states do have the ability to render citizens stateless, and some have made protocols and reservations to that effect. Some people have sought to portray those states as somehow despotic, or—[Interruption.] I know that the hon. Member for Perth and North Perthshire (Pete Wishart) is eager for me to get to his point, and I am happy to do so, but I do not think anybody would regard countries such as Belgium or the Republic of Ireland as despotic, and those states have reserved powers to make citizens stateless. Although it is difficult to make generalisations, because of the different treaties and conventions to which each country is subject, other countries have reserved powers to make individuals stateless in certain circumstances.

[Keith Vaz]

As usual, I have asked a question and the Minister has given me a straight answer, and I am extremely grateful. He mentioned Belgium, but what are the practicalities of what it has done? I accept that the power in question is used in other countries, but what happens when a citizen of Belgium has their citizenship removed and is left stateless? Is not the truth that they cannot go anywhere else?

[James Brokenshire]

I would hesitate to provide commentary on the laws of Belgium, the Republic of Ireland or other countries that have reserved this power. I have explained to the House this afternoon what would happen in this country if someone were left in those circumstances, and I hope that I have provided clarity.

[Glenda Jackson (Hampstead and Kilburn) (Lab)]

Although I was not present for the beginning of the Minister’s speech, I have been watching the debate assiduously in my office.

In my constituency, there have been cases in which an individual has rightly been threatened with deportation by Her Majesty’s Government, yet their home nation state has categorically refused to take them back. I have constituents who have automatically lost their nationality by making an application in this country not for citizenship but for asylum. As my right hon. Friend the Member for Leicester East (Keith Vaz) asked, what are the practicalities? Do we wander the world trying to sell those individuals to some accepting nation state?

[James Brokenshire]

It is not about that at all. I am sorry that the hon. Lady may have missed some of my earlier comments, although I appreciate that she has been watching from afar. As I stated earlier, the provision is about dealing with a small cadre of individuals who may have waived or surrendered their previous citizenship as a means of frustrating the Government’s attempts to guard our national security by using our existing deprivation powers. The Home Secretary would need reasonable satisfaction in exercising the power to deprive. It would then be open to the individual in question to take whatever steps they needed to take to regularise their position. We are closing a gap that the Labour Government left us by virtue of the changes that they made in 2002 and built on in 2006. The Supreme Court highlighted that gap in the al-Jedda case. Our proposal is intended to guard our national security.

We recognise the comments that have been made here and in the other place, but Lords amendment 18 would prevent deprivation of citizenship from being pursued in the case of an individual who had no recourse to another nationality. Every country operates its own nationality law, and there are a range of requirements and eligibility criteria. As part of the “reasonable grounds” consideration, the Home Secretary will of course consider whether there are any legal points that would prevent an individual from regaining their former nationality. The individual in question will retain a full right of appeal, which will be to the Special Immigration Appeals Commission. The courts will be able to consider whether the Home Secretary was correct to conclude that there were reasonable grounds to believe that that person was able to become a national of another country or territory under its laws.

As the Government have stated in both Houses, the proposal to extend the Home Secretary’s powers to deprive citizenship is an important and timely measure to strengthen the security of the UK. It has rightly been subject to substantial debate, and to scrutiny by the Joint Committee on Human Rights and Members of both Houses. We do not agree that a small Committee from each House would be the right place to consider the matter. It would not have access to the appropriate closed material to make further assessments beyond what has already been discussed in the House. Having such a Committee would also cause unnecessary delay, leaving a loophole to be exploited and creating a barrier to effective action for a considerable number of months, if not years. It is important that we close the loophole in a timely way, which is why the Government have decided to proceed with a narrower measure than we had originally proposed in preference to allowing delays for a Committee to consider the issues.

[Sir Richard Shepherd]

Is the Minister saying, then, that the person deprived of their citizenship will not know the reasons for that, and that the only course of court action will be through SIAC, which is a secret court? We will therefore never know whether the deprivation was justified.

[James Brokenshire]

My hon. Friend will gain satisfaction from the judgment that SIAC will make in each individual case. He will be familiar with debates that we have had on other legislation and with the challenge for any Government of how to handle sensitive material. He will also know the existing case law on the gisting of some material, and that is a matter of active consideration by the courts. I therefore think that the public, the House and the country can be satisfied that if SIAC has considered a matter, it will have done so appropriately and reached an appropriate outcome in respect of the actions by the Secretary of State.

[Glenda Jackson]

Will SIAC have the information from the individual’s home Government? For example, will there be a requirement on the Chinese embassy—I cite China because it is the first example that comes to mind—to furnish evidence as to why it is refusing to allow its former citizen to regain their nationality, and will that information be furnished to SIAC?

[James Brokenshire]

It is difficult to comment on individual circumstances and cases. The Secretary of State will need to show that her judgment was reasonable in bringing forward and using the power that we are contemplating, if the amendment is accepted, and it would obviously be open to the individual to present evidence to SIAC in non-closed circumstances regarding their situation, and to challenge that decision. That right of challenge is obviously protected by provisions in the Bill.

15:30

On Report in the Lords, the Government tabled an amendment to provide for an independent review of the use of the new power to deprive. That was in response to concerns expressed in earlier debates that there should be independent scrutiny and that a report should be made to Parliament, and that provision is included in the measures we propose today. We recognise the importance of scrutinising the operation of the power at the earliest opportunity, and we have therefore proposed to review it after 12 months, with a subsequent 36-month review period. A report to the Home Secretary will be laid before Parliament alongside those reviews, which can then be debated in both Houses. We have not yet decided who will conduct those reviews. It may be appropriate, for example, to appoint the independent reviewer of terrorism legislation—currently David Anderson—to take on that additional task, but we are mindful that if the review of the deprivation power is added to the demands on him, that must not be to the detriment of his capacity to meet his existing important statutory reviews.

[Several hon. Members]

rose—

[James Brokenshire]

I will draw my comments to a close, as I have been generous to hon. Members across the House.

In conclusion, this power is narrowly drawn and aimed at addressing a real and current threat posed by a small number of individuals. The Government have taken steps to listen to the concerns of both Houses about statelessness. We are committed to taking proportionate action to protect the public and remove the privileges of British citizenship from those who abuse it. That is what these provisions do, and I commend them to the House.

[Mr David Hanson (Delyn) (Lab)]

I support the Lords amendments. Having listened to their lordships and to contributions from Members across the House, and having noted the keen interest there appears to be in this debate, I hope that the Minister will reflect on what he has said and support the Lords amendments in due course.

I will start with a quote:

“If we identify someone as a person proposing to commit a serious terrorist offence, for example, surely the obligation is on us to deal with that person. If we simply deport him, we shall be handing on—in my submission, irresponsibly—this terrorist problem to another state which may not have the same capability of dealing with it as we do. It cannot be a proper response to the terrorist threat to refuse to deal with it ourselves”.—[Official Report, House of Lords, 9 October 2002; Vol. 639, c. 277-78.]

That was the late Lord Kingsland who spoke in October 2002 as Conservative shadow Lord Chancellor when these matters were debated in relation to nationality. At that time, the then Labour Government determined that statelessness should not be part of the legislative framework, and that prompts the question why have the Government brought forward this proposal at this time?

I think the Lords did a service to Parliament in providing it with an opportunity to discuss this proposal again, and I remind the House that the Lords voted by 242 votes to 180 to ensure that the amendment was accepted in another place. Among those who voted were a large number of Labour peers, and it is fair and proper that I report that to the House. There were also many others, both Cross-Bench, from the Government Benches and among the Bishops, who voted to ask this House to consider the matter again. Those included Lord Judge, a former Lord Chief Justice, and Lord Hannay, a former senior diplomat, as well as such Liberal Democrat notaries as Lord Lester, Lord Willis of Knaresborough, Lord Roberts of Llandudno, Lord Phillips of Sudbury, Lord Oakeshott and Baroness Neuberger, and also the notable former Foreign Secretary Lord Howe of Aberavon. That group of peers did not vote for the amendment to cause trouble for the Government; it is a group of peers who take an interest in this matter and have reflected on the Government’s approach. Whatever else can be said, the Home Secretary did not convince the other place that her measures were right and proper. In fact, the charitable view is that the Home Secretary has made a mess of this matter. She has tried to rush the proposals through.

[James Brokenshire]

No.

[Mr Hanson]

The Minister says no, but the Home Secretary brought forward the proposals on 30 January on Report, after they were tabled on 29 January. We had to table a manuscript amendment on Report, which we withdrew because we wanted to take legal advice. That legal advice led to a cross-party Lords amendment, moved by Lord Pannick, to ensure proper consideration of the proposals in Committee.

The Lords amendment is reasonable. It asks for the establishment of a Joint Committee of both Houses to consider and report on the complications of the removal of citizenship and the issues raised by Members across the House. From discussions I have had with the Minister, I know he is concerned that that would lead to delay, but I hope I can reassure him. Through agreement outside this House, we could, if the Lords amendment was accepted, give a time scale to that consideration to ensure that we have detailed examination and, effectively, pre-legislative scrutiny of the proposal, so that we can take the concerns raised in another place seriously, look at what points are being made even today by Members of this House and come to a consensus on this extremely serious issue—the removal of citizenship from individuals.

I think we can come to an agreement whereby a proposal is considered and completed perhaps, dare I say it, by the summer recess. I do not want to pre-empt the Gracious Speech in a couple of weeks’ time, but it will undoubtedly include a criminal justice Bill. Measures could be introduced at that stage and looked at in detail.

[Dr Huppert]

The shadow Minister is talking about the process and that is very interesting, but can I press him on the Labour party’s view on the policy principle? Some of us, including some Labour Members, voted against the measure on principle. He says that it may be a positive thing to have this sort of deprivation. His party abstained, with Whips quite forcefully stopping people voting. What is the Labour party’s position on the principle at stake?

[Mr Hanson]

If the hon. Gentleman will allow me, I will come on to that point in a moment. We abstained on 30 January because we wanted to ensure that we gave proper consideration to this matter, and we supported the amendment in another place to ensure that we did consider this matter. My noble Friend Baroness Smith of Basildon signed the amendment before the House today. We want to support the amendment today and return it to the Lords.

The Labour party and my right hon. Friend the Member for Normanton, Pontefract and Castleford (Yvette Cooper) will not do anything that puts the security of the United Kingdom at risk. I want to ensure that we do not remove citizenship without a proper right of appeal. I want to ensure that people know the grounds of that removal of citizenship and that the consequences are considered. I want, with the Minister, to tighten up how the Government intend to exercise that power. How do the Government intend to ensure that what is “reasonable” is deemed to be reasonable? I want to give the Minister the opportunity to explain that. This is a serious matter that needs proper parliamentary scrutiny. We have had a very short time in another place and one day in this House to consider this matter. We need to look at it in much more detail and we need to take evidence. A large number of people outside this place have raised concerns and we need to ensure, and not just in one-and-a-half hours, that the Minister justifies the opportunity and practice over a period of time.

[Mr Harper]

The more the right hon. Gentleman speaks, the more confused I am about his position. My right hon. Friend the Home Secretary tabled the amendment in January, so more than three months have passed since she put this provision before Parliament. The right hon. Gentleman has now said, notwithstanding the fact that the amendment says the Committee will serve for the duration of the Parliament, that it could all be sorted out before the summer recess, which is only two months away. What does he expect to learn in the next two months that he has not learnt in the past three?

[Mr Hanson]

I think both Houses of Parliament should have an opportunity to take evidence, as happens during pre-legislative scrutiny, and I am not the only person who thinks that. Moving the amendment in the House of Lords, Lord Pannick said:

“A Joint Committee is required because Clause 64 was added to the Bill very late in the passage of the Bill through the other place—that is, 24 hours before Report and Third Reading…so there was no pre-legislative scrutiny of this proposal, no consultation and no opportunity for consideration by the Public Bill Committee of the other place. The absence of pre-legislative scrutiny and proper consultation is especially unfortunate in a context such as this.”—[Official Report, House of Lords, 7 April 2014; Vol. 753, c. 1168.]

The hon. Member for Forest of Dean (Mr Harper) may want to steamroller the Bill through, but I think it important that we get it right.

[Glenda Jackson]

There is a great, gaping hole in the Government’s argument. However much the Minister may speak about the powers of the Home Secretary, no British Home Secretary in the House of Commons has ever had the power to impose on a sovereign nation state laws governing whom it should or should not take back, and to whom it should or should not give a passport and citizenship.

[Mr Hanson]

My hon. Friend has anticipated some of my own arguments. Like the hon. Member for Cambridge (Dr Huppert), I think we need to examine important issues relating to both the deprivation of citizenship and the impact on terrorism prevention. The Minister is seeking to delete the amendment in order to prevent potential terrorist action. I want to test him on that, potentially during scrutiny in the Committee, but also in the House today.

If citizenship is removed from an individual who happens to be outside the country, we shall have given up all jurisdiction over that individual, who could be returned to the United Kingdom by a third-party country that did not recognise him as having citizenship of that country. As Lord Kingsland said in 2002, he will not be the responsibility of the United Kingdom, but will still be potentially able to undertake activity that the Minister would not support, as a result of the Minister’s own actions.

[James Brokenshire]

I am somewhat confused by what the right hon. Gentleman is now saying. Does he not support the Government’s existing use of the deprivation powers to deal with counter-terrorism?

[Mr Hanson]

The Minister should reflect on that. He will know that the Nationality, Immigration and Asylum Act 2002 specified just two grounds on which citizenship could be removed: it could be removed from those who had gained it through fraud, and it could be removed

“if the Secretary of State is satisfied that the person has done anything seriously prejudicial to the vital interests of…the United Kingdom”,

provided that the revocation of citizenship did not render the person stateless. That is the point, and that is the position that was taken by the Labour Government in the 2002 Act, about nine to 12 months after the horrendous events of 9/11. Surely, if we made that judgment in 2002, at the height of concern about the impact of 9/11, the Minister will be able to back it up in 2014. If he cannot, let him justify that to a Joint Committee. Lord Pannick said in another place:

“The Joint Committee will also want to consider whether the benefits, if any, of the proposed new power justify the… international implications.” .”—[Official Report, House of Lords, 7 April 2014; Vol. 753, c. 1169.]

How can the British Government lecture others, or promulgate international law, when the Bill proposes the establishment of circumstances which, in my view, would break international requirements across the board? The Minister says that that is not the case, which is a view that we need to discuss.

[Jeremy Corbyn]

I agree with what my right hon. Friend has just said, but is not one of the fundamental problems the fact that what the Government are doing has about it more than a whiff of Executive decision making on major issues to which there is no simple legal remedy? The Government are trying to avoid a court process, and to give powers to an elected politician over an independent judiciary.

[Mr Hanson]

I am grateful for that because my hon. Friend anticipates the concerns we had and that we raised in the debate on 30 January. The proposal then from the Minister was that the Home Secretary could determine, on reasonable grounds, the deprivation of citizenship. There was no judicial oversight promised. The Minister has today brought forward amendments (a) and (b) which would provide for a review. I do not happen to think they go far enough. I think we need to stick to the original idea of an examination by a Joint Committee. The Minister, however, has brought forward those amendments which move slightly from his original proposal of some six or seven weeks ago. Why has he done that? He has done so because he has been roasted in another place and, this proposal having been considered by Members of that other place, has lost the vote quite considerably. Yet today we find that, rather than listening to those concerns, the Minister wishes to vote down this amendment and has brought forward proposals that, again, I think do not go far enough.

15:45

[Richard Fuller (Bedford) (Con)]

Like my hon. Friend the Member for Aldridge-Brownhills (Sir Richard Shepherd), when I hear phrases such as “review by SIAC” I shudder on the question of process, but I am interested to hear what the right hon. Gentleman would say to my constituents who want us to move quickly on all immigration issues—who say we are not moving fast enough, we are not making change quickly enough. What is the relative merit of his proposal to support Lords amendments that would delay enactment as opposed to the Government proposal to see and review the impact after enactment?

[Mr Hanson]

That is a legitimate question, and it is one that deserves an answer. The point I would make is that we are legislating. If we legislate for this and if it goes back to the other place in the form the Minister has brought forward, it will be enacted: it will have Royal Assent within a matter of, presumably, days. We will therefore have one year of operation between May or June 2014 through to May or June 2015. That is fair enough. We will then review it and make changes. All the concerns raised by Members today would potentially be applicable in that 12-month period. The argument I would make is that if we accept the amendment that has been considered by the Lords, we can look at this, get it right and ensure that the concerns that have been raised not just here today but by Members in another place are dealt with. The measures that are taken will then have the full confidence of both Houses of Parliament. At the moment, given the vote that was taken in the other place—242 in favour and 180 against— the proposals the Minister brought forward previously do not have the support and confidence of both Houses. The removal of citizenship is such a challenging and extreme measure to take that it must have the confidence of both Houses of Parliament.

[Mr Buckland]

I listened with interest when the right hon. Gentleman talked about his fear that the UK would be in breach of its international obligations in relation to statelessness if the Government’s proposals went through. Which particular international obligations does he think the UK would be in breach of?

[Mr Hanson]

I am trying to ensure that we propagate good practice. There are many states that currently remove citizenship from individuals. It has happened in Iraq and it has happened in other countries before, and we have been critical of that. We are trying to ensure that any action taken by a Government, particularly when it is one of Executive power by the Home Secretary, is supported by both Houses of Parliament.

Let me give the hon. Gentleman the opinion of international lawyer Professor Guy Goodwin-Gill, who says that:

“any state that admitted an individual on the basis of his or her British passport would be fully entitled to ignore any purported deprivation of citizenship and as a matter of right return that person to the UK.”

That was the point made by my hon. Friend the Member for Hampstead and Kilburn (Glenda Jackson). We need to consider this in considerable detail.

[Mark Reckless (Rochester and Strood) (Con)]

The shadow Minister did say that this was in breach of our international obligations, but he now says it is only a matter of good practice. He has quoted another international jurist and many Members from the other place, but we are the elected Members. Some of us have come to this debate to try to make up our minds. If we could hear more of what the right hon. Gentleman thinks of the principle of the Bill and the arguments around it, we could make a decision today, and I for one would enormously appreciate that.

[Mr Hanson]

I could do worse than to cite what Lord Deben, a Conservative peer, has said—[Interruption.] The hon. Gentleman looks as though he lacks concern about this, but I am expressing a number of concerns that have been expressed, both in this House and in—[Interruption.] My view is that we need to ensure that if we take this step, we do it in an effective and appropriate way that does not damage the credibility of the anti-terrorism case. Removing someone’s citizenship is an extreme measure and it has to be done in a way that is appropriate. The Minister has not made it clear to me that the “reasonable” judgments of the Home Secretary—[Interruption.] If the Parliamentary Private Secretary would like to join in the conversation, he could go to the Back Benches and do so. For the past three months we have received wodges of legal advice and wodges of views saying, “This is not practical, it will not be effective and it will damage our attacks on terrorism.” The Minister is asking us to take things on trust, but the other place has determined that it wants to examine these issues in detail, argue them and test the Minister on them, and that is a fair proposal.

Lord Deben, a Conservative colleague of the hon. Member for Rochester and Strood (Mark Reckless), has said that

“to take away someone’s citizenship, it is not reasonable to say that you assume that they can get another country’s citizenship. It is only reasonable to say that you know that they have another citizenship; anything less than that is wrong. It may not be convenient, but it is not right.

We have been the signatory to and the driver of much of the international law that seeks to reduce statelessness to its minimum. I fear that in this particular case, we may, for very good reasons—in seeking to close loopholes…do something which will do great injustice to a very small number of people.”—[Official Report, House of Lords, 19 March 2014; Vol. 753, c. 213.]

That is what we need to test by a Joint Committee of both Houses of Parliament and that is what we need to test over the next few weeks and months, which is why the other place has given its support. Justice, Liberty and the Immigration Law Practitioners Association, among others, have made cogent arguments as to why we need to consider this in detail. We need to examine it, and I support the retention of the Lords amendment and hope the House will do so.

[Sir Richard Shepherd]

I am greatly concerned about this measure, and I will just make some observations. The Minister referred to the power that the Home Secretary used to have in relation to something being not conducive to the public good. Its removal created a real difficulty for Governments, but my concern is not the difficulty for Governments; my concern is for the British common law system. This is not about the European Court of Justice—its rulings or anything else. The issue of concern to me is: what is our process?

I believe, and this was fundamental to our legal system, that a person should know the reasons they are to be aggrieved, but that is not possible under the Bill. He or she will not know the reasons they are being deprived of citizenship, so they can make no case that can be held to be valid, because they do not know what they are challenging—or they will claim they do not know what they are being challenged with. We do not know and the public do not know, so this violates one of the first principles of our legal system—our common law system. I want the House always to remember that our common law system in England has been absolutely essential to our liberties, freedoms, standing and our sense of who we are.

I understand the difficulties that Governments face, as there are a lot of wicked, evil people out there, but the answer has always been to prosecute. We are told, “Oh we can’t prosecute because in a prosecution we may have to reveal our sources.” This is the nightmare situation that the world in which we now live is facing: we are not to know, we cannot know and we cannot challenge. The Special Immigration Appeals Commission is one of the most monstrous extrusions on the national scene, as not even the solicitor representing the accused or the person who loses their citizenship knows the reasons their client is there. Gisting? Well, all those rules that have been put in place essentially deny open justice using the argument of national security.

I have been a Member of Parliament for 36 years, and I look back over the decline of our sense of who we are, what our system is, and our freedoms and liberties, which are concentrated in the concept of the common law. I did not invent it—we did not invent it—it came from the movement of the people of this country over hundreds of years and the development of our legal system. Year after year, in a way that one could never assume would happen, Governments have gone out searching for new measures to conceal the openness of what justice should be. We, as citizens of this country, have a right to know why people are charged. That is why we have an open court system, so that we can judge whether the measures are competent, reasonable or truthful to the purpose of our nation. That is why I cannot support the very notion that so much power should be concentrated in one individual—a Home Secretary—whether good or bad, that they may make decisions of this nature without our being able to challenge whether they are valid, true or right. I want the House to stand up for who we are and what our system of justice is—and it is not secret justice.

[Pete Wishart]

It is always a pleasure to follow the hon. Member for Aldridge-Brownhills (Sir Richard Shepherd). What a powerful case he has made about the closed process of justice, which has become a feature of the Government as they proceed on issues of national security.

When the Government first came to power, I cheered them on, as they practically went around deconstructing Labour’s anti-civil libertarian state, which we all remember: identity cards; the national database; pre-charge detention. I cheered the Government on when they did that, but they have now constructed a closed process with a lack of justice—all the things that the hon. Member for Aldridge-Brownhills powerfully expressed. We have created a new anti-civil libertarian state, helped by the Liberal Democrats. This is not the type of justice, society, country and community that we want. We are better than that. Yes, we need to balance national security and civil liberties, but this is another Government who have got it wrong.

The plans were roundly monstered in the House of Lords, as they deserved to be. If one looks at how many Lords supported the amendment and spoke against the measures, we find one former Director of Public Prosecutions, a former Supreme Court judge and even 23 Liberal Democrat peers. The measure was defeated by 242 to 180 votes in the House of Lords, which demonstrates wide-ranging opposition and great concern about proceeding in this way.

The Lords amendment does not even seek to delete the clause. I wish that it did. I do not have a vocation like Labour spokespeople. I think that this is a bad measure, and I voted against it in principle because it is fundamentally wrong to remove the citizenship of people of this country just because they are suspected of being terrorists. That is absolutely wrong—I make no bones about that—and I wish that the amendment deleted the entire clause. However, it does not do so; all that it seeks to do is to set up a Committee of both Houses to look at the implications of the measure and see whether we are doing the right thing.

We have not had a chance to look at the measure properly in the Commons. It was introduced on Report without our having any opportunity to consider its value or implications and what it meant in the context of the Bill. The Lords had a little more time; we have an hour and a half to consider what the Lords said, to look at the measure again and, I hope, to make the right decision. The amendment does not ask us to reject the measure; it just asks us to look at it again.

Panicked by the Lords defeat, the Government have introduced their own amendments, which would provide a review once the measure had been implemented. That is closing the stable door after the horse has left without its passport, having been deprived of its citizenship. It is too late to do anything then. We have to take a look at how the measure would impact on what we are trying to achieve and secure before we effect any legislation rather than afterwards.

16:00

Under the Government amendments, before depriving people of their British citizenship, the Home Secretary would be required to have

“reasonable grounds for believing that the person is able”

to acquire another nationality, and a review of the measure after one year and then again every three years would also be required. There are so many difficulties with the Government’s suggestions, however. The principal power would still be exercised by the Home Secretary, who would subjectively assess whether another nationality was theoretically available. We have just heard the Minister’s desperate attempts to answer the many points paraded before him during this debate. How will this work in practice? We were looking for answers when this proposal was first promoted on Report, and we are looking for answers today, but nobody knows how much of a limbo effect this will have on people who are suspects and will be subjected to this attempt to deprive them of their citizenship. We have had no clear answer on how it will impact on the individual.

The Government review will allow the Home Secretary a veto on the information put before Parliament, thus compromising both the independence and the transparency of the process. If the Government are so confident of their proposals, surely they have nothing to fear from making the case to a parliamentary Committee in a timely, considered and evidence-based manner. This contempt for the legislature and this rushed approach to law-making is no way to produce the type of outcome that we want. This measure is so draconian that it must be looked at before it is implemented, and we must have a pre-legislative look at it rather than a post-legislative review.

Of all the things said in the Lords debate, the words of Lord Pannick were the most powerful, when he said:

“There are, regrettably, all too many dictators around the world who are willing to use the creation of statelessness as a weapon…and we should do nothing to suggest that such conduct is acceptable.”—[Official Report, House of Lords, 7 April 2014; Vol. 753, c. 1169.]

It seems as though the Government message has been listened to already, when we have heard Marine Le Pen, the leader of the Front National party in France calling on the French Government to implement the Home Secretary’s plans. That just shows what a bad international example we are setting—a dreadful example around the world. This is a policy for despots, not democrats and for “liberal strippers”, not liberals. The UK’s reputation as a country that values the rule of law will be put at risk if MPs do not oppose the Home Secretary’s plans for citizenship-stripping. People need only to be suspected of terrorism to be deprived of citizenship, and we have still not heard any satisfactory answer on what will happen to these people.

This measure is unfair, possibly unlawful and unlikely to make the UK any safer. It is also a feature of the type of democracy that we are beginning to see here in the United Kingdom, with the rise of UKIP and a grotesque race to the bottom between this Government and UKIP to see who can be the toughest on immigration measures and who can be the best at stripping off our citizens’ civil liberties. Let me tell the Government that they will never beat UKIP on this. It is an absolute certainty that UKIP will always triumph when it comes to this appalling race to the bottom.

The Lords amendments would provide time for further reflection; the Government amendments are no substitute. Let us make sure that we support the Lords amendment; let us make sure that we look at this issue properly before going down this appalling road.

[Mr Harper]

Let me first remind the House what we are asking it to do today—to disagree with the Lords in their amendment. I have a reason for saying that. I listened carefully to what the right hon. Member for Delyn (Mr Hanson), the shadow Minister said, as he carefully avoided setting out his party’s view and quoted lots of other people back at us. His proposed solution was to spend the next two months before the summer recess coming to a rapid conclusion. I think that he accepts that there is a legitimate national security issue here, but what he said does not reflect what the amendment says.

Paragraph (2) of Lords amendment 18 talks about nominating a Committee that would serve

“for the duration of the present Parliament”,

with no deadline to reach a conclusion. I repeat what I said in my intervention on the right hon. Gentleman. I accept his point that there was not much time between tabling the amendment and the Report stage in this House. It is a perfectly fair point that we had discussions before the issues were discussed in the House of Lords. However, three months have elapsed and these matters have been considered in the other place, and I really do not understand what we are going to learn in the next two months that we have not been able to learn in the past three months.

[Mr Hanson]

The hon. Gentleman is right to say that the proposal is that the Committee shall serve for the duration of this Parliament. I was trying to be ever helpful by offering the Minister the opportunity that we could, through the usual channels, determine to examine these matters in a reasonable time. We could set that time informally even if the Committee did serve for the duration of the Parliament.

[Mr Harper]

I accept the right hon. Gentleman’s point, but that is not provided for. The Committee regulates its procedure. Nothing here talks about the balance of party members on the Committee. The Chairman of Committees in the other place will nominate the members from the House of Lords, and the Speaker of the House of Commons will nominate those from this place. There is no provision in the amendment to do what the right hon. Gentleman suggests.

If a Committee of members of both Houses considers the matter at length, it will produce a report. If we accept for the sake of argument that it manages to agree on the right outcome, it will only produce a report that will inform a further debate in this House. Members of this House will still be required to take a decision. We will still be required to weigh up the arguments that my hon. Friend the Minister for Security and Immigration so ably laid out before the House today and the Home Secretary did in January. We will still be required to consider the arguments that the shadow Minister did not put before the House; he simply recited the views of others. We will not be freed from the responsibility of taking a decision. It is the “kick the can down the road” amendment, which allows the House to avoid taking a decision.

These are difficult issues. I listened carefully to my hon. Friend the Member for Aldridge-Brownhills (Sir Richard Shepherd), whom I respect hugely on these matters, but there is a balance to be struck between defending the liberties of our citizens and protecting us from terrorism. I do not reach easily for the national security argument. I was pleased when I was elected to the House to vote against the provisions for 90-day pre-trial detention. But this is a proportionate and limited proposal. I supported the previous measure. The Home Secretary has listened to the debate on 30 January in this House and to the debate in the other place. Amendments (a) and (b) do two things. First, they ensure that we are not left with a situation of someone left unable to seek citizenship. She has to have reasonable grounds for believing that they are able to, and that addresses many of the concerns raised previously by the Chair of the Home Affairs Committee and my hon. Friend the Member for Cambridge (Dr Huppert), who set those out on 30 January.

A review mechanism is now in place, whether by the independent reviewer of terrorism legislation or another independent person, which will enable the House to look quite quickly, after an initial one-year process, and then every subsequent three years, at the actual implementation of the legislation in practice, so enabling us, if there are issues, if some of the concerns set out by my hon. Friend for Aldridge-Brownhills or others come to light, to enable the House to amend the legislation. The concern that the Home Secretary set out with the al-Jedda judgment leaves a gap in our legislation, which leaves us vulnerable to those who would do us harm.

[Mr John Redwood (Wokingham) (Con)]

Given my hon. Friend’s expert knowledge on this subject, can he give the House some indication of how many people this treatment might be applied to? Are we talking about very few people?

[Mr Harper]

My hon. Friend the Minister set out how many individuals had been deprived of their citizenship on non-conducive grounds, so not using this power, since 2006, and it was 27. It is not possible to know in advance, but we are talking about very small numbers. We are talking about people who conduct themselves in a way that is seriously prejudicial to our national interests. It is a small number of people, but it is a small number of people who mean to do us serious harm, but whom we are not able to prosecute.

This is a proportionate use of the Home Secretary’s power. It is reviewable by the independent judiciary, so there is a check and balance in place. We have to ask ourselves whether we want to leave ourselves open to this vulnerability, exposed by the Supreme Court. We are, as I said, only putting the law back to what it was before 2002. I do not think that any of the scenarios set out by Members happened before 2002. I urge Members to disagree with the Lords in their amendment and to put amendments (a) and (b) on the statute book when we vote this afternoon.

[Madam Deputy Speaker (Mrs Eleanor Laing)]

Order. Before I call anyone else to speak, let me say that we have a very short time in this part of the debate, so I urge Members to be brief in consideration of their colleagues.

[Fiona Mactaggart]

I will be brief. I spoke in 1997 in the debate on the formation of SIAC, and I was wrong. I thought that the changes that were being made from the previous system were sufficient to protect people who are accused of terrorism. I reminded the House then that the previous arrangements had been used against not just people who wanted to blow up our country but journalists and others such as Mark Hosenball. One reason why we need to have a publicly accountable system, as mentioned by the hon. Member for Aldridge-Brownhills (Sir Richard Shepherd), is that, without it, there cannot be a guarantee that a Home Secretary will not end up doing the same again.

I said in the debate about the formation of SIAC that transparency is the most effective protection against terrorism. I am really concerned that this arrangement not only risks creating statelessness but depends on a grossly untransparent system. I think that we should adopt the route that the Lords has offered us: yes, it is kicking the can down the road, but it is stopping and thinking so that the can is not mashed, thus destroying the reputation of our country.

[Dr Huppert]

It is a pleasure to follow the hon. Member for Slough (Fiona Mactaggart). I pay tribute to her for her acceptance that SIAC was an error and a big problem. Indeed, it is rare in this place for any of us to admit making a mistake. The encroachment of secret justice started with that commission and has continued in a number of other ways.

In the interests of time, I will not go through all my concerns. I have expressed them on a number of occasions in debates in the main Chamber and in the Home Affairs Committee and in discussions with the Minister. The reasons for my concerns remain the same, which is why I was proud to oppose the measure when we discussed it previously, and acted as a teller for the other side. It is a shame that more people did not join us, and I pay tribute to those who did, especially those Labour Members who braved the wrath of their Whips to fight their way into the Lobby, where we saw some interesting rows. It is also interesting to see people who voted for it on that occasion now opposing the principle. I still oppose the principle. There has been much more debate, both in the other place and on the Home Affairs Committee, which has helped to clarify how the measure might work. The Select Committee’s report on counter-terrorism is due out shortly, and I hope the Minister will look carefully at what it says. Obviously, I cannot presage its comments on anything, but I am sure that he will be interested to see it.

There are many issues relating to what happens if somebody is stateless in this country. If we end up leaving someone stateless because they cannot get the passport that we thought they could apply for, we have taken somebody who is apparently dangerous to us and prevented them from leaving the country. That does not seem a great success to me. There is also the issue about what happens if they are overseas. It also fosters the idea of two classes of citizen—people whose citizenship can be taken away without them being convicted of something and those who cannot have it taken away. It is about how the legal process works and much, much more.

In the interests of time, let me talk about the Government concessions, which I welcome. They are a step in the right direction, but they do not go far enough for me. There are two of them. I welcome the concession about the independent reviewer, and I was pleased to hear the Minister imply that it may be the independent reviewer of terrorism legislation, for whom I have huge respect. I would be more encouraged if he, rather than others, was taking on the role. I understand that no decision has yet been made. Will the Minister clarify whether the reviewer will look at specific cases, or just the overall process? Will they be able to trigger a review if a particular case has gone wrong? Will they have full access to all the information that SIAC has? If the independent reviewer does not have all that information, it will be hard for them to make a proper judgment.

Let me turn to the other amendment about reasonable grounds for belief. I welcome this step, because it addresses the key issue of avoiding statelessness. We should all be very concerned to avoid anything that will leave people stateless. My concern is about how certain we are. It was helpful to hear the Minister say—I ask him to correct me if I misquote him—that if someone wanted to claim asylum from a country, that would be deemed to mean that the Home Secretary could not act. If it was not possible to get the citizenship without travelling and the person was stuck in this country, that would be an issue.

I am still concerned about the appeal rights and about what will happen if the Home Secretary makes an error. What will happen if she acts reasonably, but it turns out that she is wrong and someone cannot get citizenship? That would be very alarming and I hope that the Minister will consider the issue and perhaps even tighten this up in the other House.

16:15

[John McDonnell]

It is a disgrace that we are talking about civil liberties and yet we have only nine minutes left, the debate in the Lords ended only 18 hours ago, and the amendments land before the House when it is likely to rise early next week because of insufficient business. Our job is responsibly to look after our constituents’ interests, which means both their human rights and their protection and security. Not one of the amendments we are considering is capable of doing that as a result of this bouncing of the House. I have been in this place only 17 years now and the worst civil liberties violations have occurred when the House has been bounced into urgent decisions. That is what is happening today and I resent that.

I resent it on behalf of my constituents. The practicalities of the provisions mean that we will deprive some of their citizenship and, as the hon. Member for Aldridge-Brownhills (Sir Richard Shepherd) has said, we will do so in a way that will not even allow them to answer the charges themselves. That is the SIAC process, which I voted against all those years ago.

What are the practicalities of depriving someone of their citizenship when they are a threat, particularly if they are abroad? In the other House there was a discussion about the comity of interest between individual states. What are we to do? Will we deprive a suspected terrorist of their citizenship and leave them as the responsibility of another state? Will that protect our citizens’ interests, if that person can then roam free to take action against this country? That is not fair, just or based on human rights, and it does not practically tackle the issue of security.

Their lordships want time to set up a Joint Committee to give this difficult area of policy the detailed consideration it needs. The Minister referred to the Government’s proposed review as independent, but the amendment makes no reference to independence. The reviewer will be appointed by the Government, not by an independent process. In addition, the Secretary of State will have a veto over what is reported to the House and that applies not just to national security but, as the amendment says, to public interest. Public interest has been used in this House by successive Governments to avoid embarrassments and to avoid providing the House with information on which we can make considered judgments.

The Government’s amendments are not acceptable. I do not think they resolve the concerns that the other House has raised and I hope that that place holds firm so that we can negotiate a proper process. I agree with my right hon. Friend the Member for Delyn (Mr Hanson) that we need a reasonable process within a limited period of time to allow us to return to the House to consider proper proposals that protect civil liberties while, just as importantly, protecting the security of our constituents.

[Mr Buckland]

I feel like I am in an episode of “Just a Minute”, Madam Deputy Speaker, but here goes.

I support the Government’s amendments, as we must focus on the issue. This is not some descent into despotism; all we are talking about is a return to the law as it stood before 2002. We are not even talking about the principle of statelessness, because the Nationality, Immigration and Asylum Act 2002 allows for a person to be stateless when that nationality has been obtained by fraud. We are talking about only a very small cohort of people who pose a serious threat to the safety of the citizens we represent.

It is important that the Government ensure that they do not end up with decisions being made in an arbitrary or disproportionate way, which is why the provision about reasonable grounds is important and goes a long way towards answering that point. The report of the Joint Committee on Human Rights, of which I am a Member, correctly said that the decision to deprive people of their state per se does not breach any international conventions. That is the case that was not properly answered by the Opposition.

In the seconds I have left in which to speak, all I can say is that the Government have moved a significant way and that that allows me and others to support their amendments and reject the Lords amendment.

[James Brokenshire]

It is worth outlining again at the outset the purpose of the Government’s amendments, which is to close a gap that has been highlighted by the Supreme Court, to guard our national security and to deal with a very small number of individuals who put this country’s security at risk. It is only to deal with those very serious cases of people whose conduct meets the requirement of being

“seriously prejudicial to the vital interests of the UK.”

It is important to understand the context and how the Home Secretary, in exercising the power based on the amendments, must have reasonable grounds to believe that under the laws of a country or territory an individual is able to become a national of that country or territory. We have listened to the points that have been made about statelessness, and the amendments address and significantly close the issues that have been highlighted in the other place.

On scrutiny, as my hon. Friend the Member for South Swindon (Mr Buckland) said, the matter has been considered by the Joint Committee on Human Rights, as well as in the other place, so it is not correct to say that it has not been subject to careful consideration in the other place and by Members of this House, or considered in detail. That was incorrectly suggested by the right hon. Member for Delyn (Mr Hanson), who spoke for the Opposition. He has made various assertions that in some way the provisions are not compliant with our conventions and obligations to the United Nations. I reject that. We do not accept that in some way the provisions that are contemplated in the amendments do not comply with our conventions. Indeed, we believe that they adhere more closely to our obligations.

[Yasmin Qureshi (Bolton South East) (Lab)]

rose—

[James Brokenshire]

I am afraid that I do not have time to give way.

We have reflected on the need for oversight and have provided for periodic independent reviews. My hon. Friend the Member for Cambridge (Dr Huppert) asked whether David Anderson is an appropriate person. He is certainly someone we are examining and we want to have discussions, if the amendments are accepted, to consider his role in that context.

We take our obligations on statelessness extraordinarily seriously and in terms of common law the House has considered these matters in the recent past. My hon. Friend the Member for Aldridge-Brownhills (Sir Richard Shepherd) has consistently made that point. There are challenges for the Government in what we are able to do to ensure that evidence can be provided appropriately in guarding our national security, and that gisting of facts and information remains available. It is important that the right of challenge exists, but it is also important that we guard our national security, which is why I commend the amendments to the House.

16:23

Ninety minutes having elapsed since the commencement of proceedings on consideration of Lords amendments, the debate was interrupted (Programme Order, this day).

The Deputy Speaker put forthwith the Question already proposed from the Chair (Standing Order No. 83F), That this House disagrees with Lords amendment 18.

The House proceeded to a Division.

[Madam Deputy Speaker (Mrs Eleanor Laing)]

I ask the Serjeant at Arms to investigate the delay in the No Lobby.

16:23

Division 266

Ayes: 305

---

Conservative: 263
Liberal Democrat: 37
Democratic Unionist Party: 4

Noes: 239

---

Labour: 225
Scottish National Party: 6
Conservative: 2
Social Democratic & Labour Party: 2
Plaid Cymru: 2
Independent: 1
Green Party: 1
Liberal Democrat: 1

Lords amendment 18 disagreed to.

Government amendments (a) and (b) made in lieu of Lords amendment 18.

[Madam Deputy Speaker (Mrs Eleanor Laing)]

I now have to announce the result of the deferred Division on the question relating to the draft Licensing Act 2003 (Mandatory Conditions) Order 2014. The Ayes were 313 and the Noes were 205, so the Ayes have it.

[The Division list is published at the end of today’s debates.]

Before Clause 60

Child trafficking guardians for all potential child victims of trafficking in human beings

[James Brokenshire]

I beg to move, That this House disagrees with Lords amendment 16.

[Madam Deputy Speaker (Mrs Eleanor Laing)]

With this it will be convenient to discuss the following:

Lords amendment 24, and Government motion to disagree.

Lords amendments 1 to 5.

Lords amendment 6, and manuscript amendments (a) and (b) thereto.

Lords amendment 7, and manuscript amendment (a) thereto.

Lords amendment 8, and manuscript amendment (a) in lieu.

Lords amendments 9 to 15 and 17.

Lords amendment 19, and manuscript amendment (a) thereto.

Lords amendments 20 to 23 and 25 to 36.

[James Brokenshire]

This group covers the remaining aspects of the Bill. I will focus on Lords amendments 16 and 24 at the outset, which, as has been highlighted, infringe financial privilege.

Lords amendments 16 and 24 require the appointment of a guardian to represent the interests of children when there are reasonable grounds to believe that they are the victims of cross-border trafficking. The Government wholeheartedly share the noble Lords’ intention to protect and support that incredibly vulnerable group of children. Supporting victims, including children, is at the heart of everything that we are seeking to achieve through the draft Modern Slavery Bill. That Bill aims to tackle the appalling crimes of human trafficking, slavery, forced labour and domestic servitude. Those crimes are quite separate from the matters that are dealt with in the Immigration Bill. In our judgment, it would be wrong and unhelpful to conflate the two.

[Lisa Nandy (Wigan) (Lab)]

Before I came to this place, I spent nearly a decade working with trafficked children. These matters are not separate at all, because many trafficked children come through the immigration system, and often the only state official they come into contact with is a member of the UK Border Agency. These matters are as one and the Immigration Bill is a fitting place to provide support and protection for such children.

[James Brokenshire]

I agree with the hon. Lady that immigration can be a relevant factor and that it relates to a number of the issues that are involved in trafficking. From visiting charities and meeting victims of trafficking, I understand the compelling stories and issues that they raise. However, at its heart, trafficking is organised crime. Sometimes, when it is viewed simply in the context of immigration, significant aspects of the level of organisation and criminality involved can be missed, as can trafficking within the UK. That is why we judge it important to recognise the broader context so that the solutions that are provided are comprehensive and address all the issues involved. The Government’s approach of seeking to understand that broader context and the organised criminality involved has gained support from non-governmental organisations, charitable organisations and others.

16:45

Consensus is also being gained across the House, because we recognise that victims of child trafficking need specialist and dedicated support and that the current provision of support for those children can be patchy and inconsistent. That was why I announced in January our intention to trial specialist independent advocates for victims of child trafficking. The trial was due to start on 1 July across 23 local authorities, to test how those advocates might improve the experiences of those extraordinarily vulnerable children.

The Government consider that the role of our specialist independent advocates is almost entirely aligned with that of the guardian set out in Lords amendment 16, with two important deviations. First, the Lords amendment would extend the provision of guardianship to adults up to the age of 21, whereas our advocates will instead focus on the needs of children, including those who may be involved in an age-related dispute.

Secondly, the Lords amendment would apply only to victims of cross-border trafficking. The evil of child trafficking extends not only to those who are trafficked across our borders but to children who are trafficked within the UK, as the horrific sexual exploitation of girls in Rochdale and Oxford has shown. That is why our specialist independent advocates will offer support to all victims of child trafficking, not just those trafficked across our borders. [Interruption.] The hon. Member for Wigan (Lisa Nandy) is making her point from a sedentary position, but I genuinely do not think that there should be a difference between us on this point. There is a genuine desire to address the issue in its broadest sense and understand it effectively and properly. I know that members of the Joint Committee on the Draft Modern Slavery Bill are here this afternoon, and they have made an enormous contribution to the consideration of these matters. I do not want to get drawn into a broader debate this afternoon—I hope there will be plenty of further time for that—but I believe that there is a growing unity of view across the House on the need to act and the way in which we should approach this issue.

[Lisa Nandy]

I welcome the fact that the Minister is trying to look at broader issues of children’s welfare; perhaps I would welcome that even more from the children’s Minister.

There is a particular issue for children who come into this country from overseas concerning their immigration status. Quite often, the reason we do not get trafficking prosecutions and do not really tackle this awful crime is that we do not treat the victims properly. Children who are accommodated under section 20 of the Children Act 1989 do not have anybody with parental responsibility to instruct their lawyer, which is why this debate really matters.

[James Brokenshire]

I am grateful to the hon. Lady for her intervention and for her genuine passion and concern for the welfare and well-being of an incredibly vulnerable group of children. We are taking forward our pilots of child advocates so that we can ensure that there is support for those children, and we must not take lightly our responsibility for protecting them. However, having tested the model of advocacy, we do not want to risk putting in place a model that would fail to deliver safety for that group in a practical way.

[Mr Frank Field (Birkenhead) (Lab)]

I am not sure there is a dispute between the Minister and my hon. Friend the Member for Wigan (Lisa Nandy) on the issue. If the model that the Minister advocates were to go ahead, it would cover both trafficked children and those who are not technically trafficked but are pushed around and sold in this country. For many of us, the nub of the debate is whether the Government will meet the spirit of the Lords amendment, which is not only to give permission for the Government to go ahead with the pilots but to see whether the scheme will be rolled out universally when the results of the pilots are known.

[James Brokenshire]

I am grateful for the right hon. Gentleman’s intervention, for his work in chairing the Joint Committee and scrutinising the draft Modern Slavery Bill, and for the report that has been produced. The Government are considering that report carefully and will respond in due course.

The right hon. Gentleman is right to say that there should not be dispute on this issue. There might, however, be a difference of emphasis—perhaps I might characterise it like that—between me and the hon. Member for Wigan on why I believe the Immigration Bill is the wrong place to deal with this issue in a broad sense. We are, of course, reviewing work on that initial assessment of when children present to different agencies, and the fact that EU children and non-EU children are dealt with differently in the system. We are examining that carefully and scrutinising the way the system operates at the moment. I hope I can reassure the hon. Lady by recognising that we should consider carefully issues such as initial identification and the way in which different agencies highlight children through that system, as well as the way the system operates and responds, and the different times taken to make an initial determination. It is important that such work is conducted, and it has been commenced by the Government.

In a practical sense, it is important to bring agencies together and to shine a light, as I characterise it, on crimes that have largely been in the darkness. Vulnerable individuals have not been highlighted and brought to attention, and we need greater recognition of the serious criminality involved, and the appalling exploitation and trade in human misery that underpins so many of the dreadful actions we see.

We believe that Parliament has already considered the draft Modern Slavery Bill, and that when the full Bill is presented that will be the right place to address the issues highlighted by the Lords. The full Bill will include an enabling power to ensure that we have the opportunity to test and assess fully the child trafficking advocate role through a trial, before setting in stone its specific functions. By taking that approach we will achieve what is essentially our collective ultimate aim: to give children who have been subjected to this appalling crime the best chance of dealing with the trauma of their experiences.

[Mr Frank Field]

I have two questions for the Minister on this important point. I do not think anyone disputes that it might be better for such provision to be part of the Modern Slavery Bill, but the question is about what the Government will transfer to that Bill. The measure passed by their lordships was not to interrupt the Government’s pilots—they are all in favour of those—but to ensure that once the results of those pilots are through, there will be a statutory basis on which to make the service universal when public expenditure allows that movement to occur. Can the Minister give the House that assurance?

[James Brokenshire]

As I have indicated, our intention is to introduce an enabling power. We will provide a statutory basis for the child trafficking advocate role in the Modern Slavery Bill, which we will be in a position to inform through the trials that are due to start in July. Our concern is that the Lords amendment as currently framed would put those trials at risk—we do not see how the trials could commence if the current provisions are maintained. I hope that by assuring the right hon. Gentleman about the Government’s intention to provide that statutory basis, he will understand that that enabling power will provide the underpinning for further work, which can properly be informed by the results of the trials that will start in the summer.

[Mr Field]

I am grateful to the Minister for giving way, because this issue is so important. He is proposing that, if we do not oppose their lordships’ changes, he is offering in return the trials and, when we have learnt from the trials, a statutory basis for the service. Is that what the Government want to be in the draft Modern Slavery Bill?

[James Brokenshire]

Clearly, having announced the trials at the end of January, I want to see them proceed. It is important that we test the service and the system, which is patchy and not as consistent as I want it to be. Equally, some local authorities provide good services and it is important that we recognise that and learn from them. We want an enabling provision in the draft Modern Slavery Bill to be the bedrock that provides the mechanism, which can be informed by the trials that I want to happen, that can be acted on and be the statutory underpinning that allows it to be developed through the experience of the trials. I hope that right hon. and hon. Members will find that helpful in underlining the Government’s commitment not simply to provide a statutory mechanism through that enabling provision, but to deliver practical action. The most important thing is that we provide support, advice and guidance for this extraordinarily vulnerable group, and that we ensure they are supported through the system. That is what matters most.

[Mr Hanson]

Can the Minister remind us how many trials there will be, and where and when? What is the date of completion and when does he intend to report back to the House?

[James Brokenshire]

The trials are intended to be conducted in 23 areas, commencing at the beginning of July. We have not, at this stage, set an end point for the duration of the trials, but I want evidence and feedback that can inform the consideration of an enabling power in any modern slavery Bill that comes forward. A statutory mechanism will ensure that the trials can commence and that we can learn and benefit directly from them, enabling a statutory underpinning of the optimum provision.

[Lisa Nandy]

I am grateful to the Minister for giving way again on such an important issue. The statutory underpinning for advocates is welcome. I want to check that they will be provided for children who are suspected of being victims of trafficking before they have to go through the very difficult process and jump through those hoops to be deemed a victim of trafficking. It is that process that children find very hard to get through. Will advocates be provided at the point at which concerns are raised that the child may be a victim of trafficking, rather than at the point when they have been deemed by the system to be a victim of trafficking?

[James Brokenshire]

Under the arrangements, each child victim is to be allocated a person with specialist training and expertise in trafficking. They will provide dedicated support and guidance to ensure that the child’s voice is heard. That is often the biggest challenge when there are so many different obstacles, such as language and the trauma the child has gone through. It is intended that the advocates will provide a single point of contact through the care and immigration process and will be responsible for promoting the child’s safety and well-being. That is particularly important in relation to the risk of children being re-trafficked, which is a significant concern. Children have disappeared and the worry is that they have been re-trafficked into slavery.

The scope of the work is being developed further. I note what the hon. Lady has said about initial identification and support throughout the subsequent process. I would expect the trials to involve thorough and appropriate tests, in accordance with the optimal periods during which interventions can take place. I would also expect appropriate support to be provided for children who have come forward and are waiting for an initial assessment of the prima facie evidence relating to whether or not they have been trafficked. I recognise the genuine concern that has been expressed by Members and others about the provision of support, and I hope that my assurances will enable the House to support the Government in disagreeing with the Lords amendments.

17:00

[Mr Frank Field]

If a child was brought into this country and an immigration officer suspected that the child was being enslaved, could the child be referred to the advocate at that point so that the advocate would have a chance of separating the child and a slavemaster?

[James Brokenshire]

Let me reassure the right hon. Gentleman, and the hon. Member for Wigan, that all children who are dealt with by means of the national referral mechanism—with which the right hon. Gentleman will be familiar—will be provided with advocates as soon as they are identified as suspected victims of trafficking. We intend appropriate support to be provided as soon as children have been referred.

Let me now deal with Lords amendments 1 to 4. When the Bill left this House, clause 1 provided for regulations specifying, first, who would count as a family member for the purpose of removal and, secondly, the arrangements for giving notice of removal. The power to make regulations is exercisable by statutory instrument following the negative resolution procedure.

The Joint Committee on Human Rights asked why the original clause gave discretion over whether family members should be notified of removal when we had clearly stated during a debate that they would always be notified. The Delegated Powers and Regulatory Reform Committee believed that the definition of a family member should be in the Bill, and that delegation was inappropriate. The Lords amendments are designed to address all the concerns raised by the two Committees: they would insert in the Bill the definition of family members, the requirement always to notify them of removal, and the effect of the notice.

The Government have transformed the approach to returning families with children, in line with their commitment to end the detention of children for immigration purposes. Lords amendments 5 to 9 and 29 to 34 give legislative effect to our current policies on family returns by putting key elements of the new process into primary legislation. That will guarantee that the fundamental elements of the approach cannot be changed without parliamentary oversight and debate.

First, the amendments prevent families from being removed for 28 days after any appeal against a refusal of leave has been completed. That will ensure that they will always have an opportunity to consider their options and avoid enforced return. Secondly, we are placing the independent family returns panel on a statutory footing: its advice must be sought on how best to safeguard and promote the welfare of children in every family returns case in which return is enforced. Thirdly, we are providing specific legislative protection for unaccompanied children so that they are not held in immigration removal centres when we are trying to return them. Finally, we are providing a separate legal basis for pre-departure accommodation, independent of other removal centres. It will be used only for holding families with children and only within the existing maximum time limits.

I know that my hon. Friend the Member for Brent Central (Sarah Teather) and others have tabled some manuscript amendments to Lords amendments 6, 7 and 8, which were debated in Committee and again on Report in the other place. I am sympathetic to her intentions and the intentions of those who have supported her manuscript amendments. However, although I understand the motivation, her amendments (a) and (b) to Lords amendment 6 and amendment (a) to Lords amendment 7 would widen the definition of families in the family returns process and apply the 28-day period during which a child, relevant parent or carer may not be removed or required to leave the UK to parents who do not live with the child as part of a family unit. They would also stipulate that we could only separate a child from their parents for child protection reasons.

These amendments do not reflect the Government’s returns process. We will always seek to ensure that families remain together during their return, but there are exceptional circumstances in which temporary separation may be necessary. For example, where there is a public protection concern or, indeed, a risk to national security, a dangerous individual might not be considered a threat to their own children but could be a risk to the wider public and we would therefore need to remove them as soon as possible, which might require a family separation.

Manuscript amendment (a) to Lords amendment 8 would mean no unaccompanied child could be detained under Immigration Act powers. Lords amendment 8 reflects the operational reality that unaccompanied children may need to be held for short periods in transit to a port of departure or at the port awaiting removal. These types of removal are rare, but if we do not hold children safely in very limited circumstances while they are travelling unaccompanied in and out of the UK, we increase the risk that they may come to harm by falling prey to traffickers or even absconding. Lords amendment 8 will ensure that detention is for the shortest possible time.

Lords amendments 10 and 11 deal with appeals, and the Government have reformed appeal rights in this Bill to reduce complexity and provide the most effective and appropriate remedy for all cases. Administrative review will provide a faster and cheaper way of correcting caseworking errors, but Lords amendment 10 provides further assurance. It requires that the Secretary of State commission the independent chief inspector within a year of clause 11 being commenced to prepare a report on administrative review. That report must address the specific concerns raised about the effectiveness and independence of administrative review. Lords amendment 11 makes a technical correction to clause 11(5), which provides that the tribunal may not hear a new matter that the Secretary of State has not considered unless the Secretary of State consents to its doing so.

[Jeremy Corbyn]

On the question of administrative review, is it not really a way of avoiding the inconvenience —from the Home Office’s point of view—of a proper appeal where the individual can be properly represented and the whole case be considered? Is it not just another example of trying to get rid of the impediments of any legal appeal system on behalf of the individual?

[James Brokenshire]

The administrative review process is already effective in identifying and correcting caseworking errors. From April to December 2013, 93% of these administrative reviews were completed within 28 days, and 21% of the administrative reviews requested resulted in the original decision being overturned. This shows that the review process can provide an effective way of correcting errors, and it does so in a speedy and efficient manner, so that periods of uncertainty are addressed. I do not think it does anyone any good to have long and protracted periods of uncertainty. Indeed, we are in the perverse position of having 17 rights of appeal, which are being reduced to four, to ensure that matters are dealt with effectively and appropriately, supplementing the administrative review process outlined in the Bill.

The Bill also requires landlords to check the immigration status of their tenants. That is dealt with in Lords amendments 12 to 15. The scheme includes statutory codes of practice giving the technical detail of how it operates. Lords amendments 12 to 15 address concerns of the Delegated Powers and Regulatory Reform Committee to ensure that those codes have parliamentary oversight.

Lords amendments 25 to 28 deal with student accommodation. The Bill already excluded some student halls of residence from the proposed landlord checking requirement. We concluded that there was scope to go further and broaden the exemption for student accommodation. Educational institutions already have a duty to check the immigration status of their international students, and we do not want there to be double-checking of these persons. The changes therefore strike a sensible balance and minimise regulatory burdens on higher education institutions.

Lords Amendments 17, 35 and 36, which were proposed by Lord Avebury in the other place, correct an historical anomaly relating to the treatment of illegitimate children. Nationality law is complex, and anomalies arise, particularly as aspects of family life have changed since the time of the British Nationality Act 1981. In 2006, amendments to the 1981 Act enabled illegitimate children to inherit nationality from a British father in the same way as a legitimate child. Those amendments were not made retrospective. To have done so could have itself caused problems for individuals who were now adult and had made a life for themselves in a different nationality. These amendments enable illegitimate children born to British fathers before 2006 to register as British if they choose to do so, correcting a historical anomaly by providing a route to citizenship for those who want to take it.

[Dr Huppert]

I thank the Minister for the Government’s support for these amendments, which I tried to put in the Bill but encountered some technical difficulties. Will he join me in paying tribute to those who campaigned for many years to get this injustice changed? People such as Tabitha Sprague, Antonia Fraser Fujinaga and Maureen Box tried very hard, and the many thousands affected by this will be delighted that the Government are now fixing it.

[James Brokenshire]

I recognise those who have made the case for this change for some considerable time, and I am pleased that the Government have been able to support these amendments in the other place. I hope that this House will be equally able to support them here. It is important to recognise that they have addressed an historical anomaly and now allow that opportunity to the individuals affected of a route to citizenship that was not available to them before.

[Fiona Mactaggart]

The Minister rightly says that we are dealing with an historical anomaly, and that makes the case for introducing this part of the Bill and commencing it as early as possible. I hope that he can assure the House that he will put his foot on the accelerator to do that, because my constituent whose case prompted Lord Avebury to table these amendments is still stuck in limbo and, like other people, he would like to be able to remedy his situation.

[James Brokenshire]

I am grateful to the hon. Lady for that and I have certainly heard the points she has made.

I know that others wish to speak to their manuscript amendments, but let me just say that Lords amendment 19 clarifies that the Bill does not limit the duty regarding the welfare of children imposed on the Secretary of State or any other person by section 55 of the Borders, Citizenship and Immigration Act 2009. Under section 55, the Secretary of State must make arrangements for ensuring that her functions in relation to immigration, asylum and nationality are discharged having regard to the need to safeguard and promote the welfare of children who are in the UK. That duty continues to apply, and nothing in the Bill impinges on it.

Lords amendment 20 relates to some technical changes concerning the bank accounts measures. Lords amendments 21 to 23 respond to recommendations of the Delegated Powers and Regulatory Reform Committee, ensuring that, where appropriate, affirmative procedure processes apply in respect of certain notices and certain aspects of the sham marriage provisions contained in part 4 of the Bill. I believe that the Lords amendments, with the exception of Lords amendments 16 and 24, improve the provisions, making them clearer and more workable in practice.

[Mr Hanson]

I, again, thank the Minister for his helpful introduction to the Government’s position on the Lords amendments. I am here to maintain Her Majesty’s official Opposition’s support for them and wish the Government to reflect on that again during today’s debate. I pay tribute to Baroness Butler-Sloss for tabling her amendments in the other place. I thank my right hon. Friend the Member for Birkenhead (Mr Field) for scrutinising the evidence for the draft Modern Slavery Bill. I have heard what the Minister said about the proposals on a pilot and the enabling power in such a Bill, but I remain unconvinced that that will lead to the action that we want and, indeed, the action that the other place has proposed for consideration.

17:15

The House of Lords voted by 282 votes to 184 for the proposed new clause, which received cross-party support. The measure was introduced by Baroness Butler-Sloss and seconded by Lord McColl, who is a member of a Government party. I remind the House that the House of Lords took that action because there were grave concerns that we should take immediate action. The measure had cross-party support and has been cited by my hon. Friend the Member for Slough (Fiona Mactaggart) and my right hon. Friend the Member for Birkenhead.

Child trafficking remains a serious issue. If a relevant child has arrived in the United Kingdom and is a potential victim of trafficking, it is important that, once they are identified, an independent individual can monitor and represent the child’s best interests and support them in a defined role. The Lords amendment details a number of key functions for the child trafficking guardian. Those functions could be tested by the pilots that the Minister is examining, and they would give statutory legal backing to a range of issues, including responsibilities to advocate that all decisions relating to the child are made in the child’s best interests, to look at the statutory role to ascertain the child’s wishes and to ensure that the child receives appropriate care, safe accommodation, medical treatment, psychological assistance and education, translation and interpretation services. Those are all positive and, in my view, necessary requirements.

My hon. Friend the Member for Slough spoke about legal access and representation, which are equally important. Advice on legal rights is extremely important, as is keeping the child informed of relevant immigration, criminal, compensation, community care and public law proceedings. We must ensure that we contribute to the identification of a durable plan to safeguard and promote the child’s best interests. We must provide a statutory link between the child and a number of agencies, including immigration services, the police, local authorities and the national health service, to ensure that the child’s best interests are safeguarded.

It is important that someone has a statutory responsibility for the child who has arrived in the United Kingdom, perhaps with a trafficker but without family, so that contact is made with their family to establish what is in the child’s best interests in the longer term. It is important that that person has a statutory role to liaise with the immigration service in handling the child’s case and that they accompany the child to police, immigration and care proceedings. If a child appears before the courts, it is important that somebody is there to advise them.

I am approaching my 57th birthday, as I think you are, Mr Deputy Speaker. If I faced all those trials, even with the life experience that I have, I would it find it difficult to deal with all those issues. A child in a strange country needs the statutory protections provided by the amendment tabled by Baroness Butler-Sloss. It is important, as the Lords amendment makes clear, that a child trafficking guardian should undertake training in a number of things. They should probably be, as the amendment suggests, an employee of a statutory body such a local charity or council, or a volunteer with a charitable organisation.

We are debating whether we accept giving statutory underpinning to those issues, or whether we accept the Minister’s proposal of 23 pilots to commence in July, without a date for completion, with an enabling power—whatever that means in real life—to do some or all of those things. But we need to press the Minister more on the detail of his alternative. The proposal from Baroness Butler-Sloss sets out clearly what is expected of a potential guardian for any trafficked child or any child who is subject to potential trafficking. Even though my right hon. Friend the Member for Birkenhead has done good work in the Joint Committee on the draft Modern Slavery Bill, there is a template that we could agree today and which could return to the other place very shortly, with Royal Assent within a matter of days.

[Mr Frank Field]

I hope that what the Minister has said does satisfy the other place, but if we vote against the Government motion tonight, it can decide. That is the advantage. I think that the Minister has satisfied us, but I would not want the other place and those who moved the amendments not to have the possibility to consider when they read Hansard whether they are satisfied.

[Mr Hanson]

My right hon. Friend makes a valuable point. As I said at the beginning, the vote was 282 to 184 in favour of the proposal. If we reject the proposal today, we are left with no proposal. We are left with a promise of a pilot and a Bill after the Gracious Speech, following the scrutiny rightly given to it by my right hon. Friend.

[Dr Huppert]

A few of us are slightly confused about the procedure, and the right hon. Gentleman has been here longer than I have, so perhaps he could help us. If the House were to accept the Lords amendment, the Lords would not discuss this again; whereas, if we rejected it, the Lords would have the chance to discuss it. Regardless of merit, is that not the right way round?

[Mr Hanson]

That is the right way round. The Lords expressed a clear view on the matter. The Lords will be able to examine the Government’s proposal when the Modern Slavery Bill comes forward. But we have a clear template today, and I want to see that enacted. If the Government accept this today, the proposal is a clear template. We have a number of proposals from Baroness Butler-Sloss, and I have gone through them today.

[James Brokenshire]

I think that the right hon. Gentleman is saying that he wants to accept the Lords amendments because he feels that they are right, but that if he does so, it would not allow any further consideration by the Lords in terms of reflecting on what I have said from the Front Bench.

[Mr Hanson]

Their lordships have expressed their view clearly, and what the Minister has said today is known already. He announced that he had said in January that he would have pilots on the matter. The draft Modern Slavery Bill has been scrutinised by my right hon. Friend the Member for Birkenhead, and there is a template that we should support, and that is why I reject the Government’s proposal.

[Mr Harper]

I think that the right hon. Gentleman is missing the fact that the amendments are narrowly framed. They deal only with children who come to the UK from abroad. On trafficking and modern slavery, I have constant representations about not just focusing on people who come from outside the UK. The Minister has set out a sensible point. If we reject the amendments, as the right hon. Member for Birkenhead (Mr Field) has said, the other place has the option of sending them back to us again, and we can consider them again if it does not think that the Minister’s representations hold water. That is the right course of action.

[Mr Hanson]

There is clearly a common interest but a disagreement on procedure. If the Minister has a view about the impact of children being trafficked in the UK, such as in the case in Rochdale that he mentioned, he has the draft Modern Slavery Bill to contribute to those matters. But there is a clear will from the other place, which was supported on a cross-party basis, and I would wish to see that as the template for discussion today.

[Mr Harper]

One thing that would not be helpful is to put these measures in place and have a procedure that deals with foreign national children when the draft Modern Slavery Bill, expertly scrutinised by the right hon. Member for Birkenhead, will put in place yet another process for children who happen to be UK nationals. It would be much more sensible to have one process that deals with all children who are victims of slavery. We should not make the system more complicated than it need be.

[Mr Hanson]

Imperative action is needed now. I have dealt with a number of Bills over the past few years and seen the Government bringing back amendments and amending their own legislation not six months after they introduced it. There is potential here today for a clear statement and clear action on the international trafficking of children. The pilots that the Minister brings forward can be undertaken.

[Fiona Mactaggart]

Does my right hon. Friend agree that if the Minister gave a commitment, which he has not done, that this comprehensive amendment, with all the powers for advocates included, would be in his proposed Modern Slavery Bill, we would not feel the need to press this to a vote? However, the Minister has not yet given that promise.

[Mr Hanson]

My hon. Friend is, as ever, correct. I have not yet had, following my intervention on the Minister, a closing date for his proposed pilot. We do not know what the outcome of that pilot will be. We have taken a principled position on the amendments from Baroness Butler-Sloss that there is scope for that to be done immediately. I am talking about not just us here, but UNICEF, Anti-Slavery International, Barnardo’s, the National Society for the Prevention of Cruelty to Children and Amnesty International. An EU directive, which may not find favour with everyone in the House, says that we should consider that step. I understand that position, because 5.5 million children globally are trafficked each year. The UK Human Trafficking Centre identified 549 child victims in 2012. The national referral mechanism recognises 349 victims. A number of trafficked children face being sold into the sex trade and being exploited through work, cannabis farming, forced begging and sexual exploitation.

There is a need now to send out a strong signal that we want to take action on that in England and Wales. Trafficked children who arrive in Scotland value the care and support that they receive from their appointed guardians. That system works in Scotland, yet constituencies such as mine and those of my right hon. and hon. Friends still face real difficulties in that regard. Such a system operates not just in Scotland, but in many western European states, including the Netherlands, Belgium and Germany. There are templates for a system and it is time that we put in place a legislative framework for it. I wish to see that undertaken and supported today.

In passing, may I say that I welcome the changes on residential accommodation that the Government have accepted from the other place? In particular, I welcome the changes on student accommodation. I am pleased that my hon. Friend the Member for Sheffield Central (Paul Blomfield) is in his place today, as he has pressed over the past weeks and months, in Committee, to me personally and to the Minister, a very strong case to ensure that all student accommodation was included in the Bill. It is good that, following the discussions in Committee and the representations from members of Sheffield university’s students union whom my hon. Friend brought to London, the Minister has accepted that point. The Minister will have our support on those Lords amendments that have been accepted on residential landlords, students and other areas, because they are important issues.

I look forward to hearing what the hon. Member for Brent Central (Sarah Teather) has to say on her manuscript amendments. The Lords amendment has our support, and I hope that it will have the House’s support in due course.

17:29

[Sarah Teather]

I have tabled a series of manuscript amendments today to seek clarification from the Minister. I hope that he will have an opportunity to respond to my points at the end of the debate.

Let me deal first with amendment (a) to Lords amendment 8, which is my principal concern. The ending of routine detention of children in the immigration system is one of the areas of which I am most proud in my record in government. The Government can be extremely proud of that and it has made a significant difference to many children’s lives. Many thousands of children used to be detained in the immigration system and there is significant evidence of the harm that that causes to children’s mental health.

It was very hard work to get to the 2010 agreement, which followed a painstaking process of negotiation, but it has made a significant difference. Trying to enshrine it in legislation is an extremely positive step and it is important that what happened before can never happen again, but with these issues the devil is always in the detail. I am not yet persuaded that the amendments, which we have not had an opportunity to debate as they were tabled in the Lords, have the detail correct.

I have a number of questions, which I have not been able to get answers to in private, so I hope that the Minister might be able to answer them today. I tabled amendment (a) because I do not understand why we would reasonably need powers to detain unaccompanied children in this way. As drafted, the Government amendments afford less protection to unaccompanied children than to those who have a claim as part of a family. If they are with their family, the family returns panel process is enacted. No such protection applies to unaccompanied children.

If a family needs to be held prior to deportation for a short period of time they are held in Cedars, which has Barnardo’s and specialist social workers working with it and has a carefully designed process to ensure that the welfare of children is paramount. An unaccompanied child who needs to be held for a short period of time will be held in a holding facility, and at the moment they do not have any rules for best practice. Successive Governments have held that question in abeyance and my colleague Lord Avebury has managed to drag out of the Government a commitment finally to try to bring forward some rules. I am very pleased to see that, but the conditions are very different from those in Cedars.

The amendments, as drafted, do not quite meet the Government’s guidelines. I acknowledge that there is currently no time limit for the detention of unaccompanied minors, so the 24-hour limit in the Government’s amendments is at least a step forward, but chapter 31 of the immigration and nationality directorate instructions states that

“detention will occur only on the day of the planned removal to enable the child to be properly and safely escorted to their flight and/or to their destination.”

Although the amendments imply that people could be held overnight, the rules do not suggest that, so I would appreciate the Minister’s response on that point. I see that he is dealing with a matter of whipping, so I do not know whether he heard me. Perhaps he can be refuelled from the Box to ensure that that point is answered.

Chapter 45 of the enforcement instructions and guidance states:

“Unaccompanied children (i.e. persons under the age of 18) must only ever be detained in very exceptional circumstances, for the shortest possible time and with appropriate care”.

The new clause inserted by Lords amendment 8 also contains the power for unaccompanied children to be removed without removal directions already being in place so long as the decision whether or not to give such directions is likely to be positive from the Home Office’s point of view. That does not seem to me to be very satisfactory.

The serious question is: why do we need to detain unaccompanied children at all? I have asked officials about particular cases in which this might apply, and they gave me the example of a Japanese student who wanted to come to the UK to study but found that the institution they were going to study at had suddenly been dissolved. We would need to put them on a plane rapidly, so we would have to hold them for a short period of time. The Minister gave the example of someone who might have to be detained for their own safety to prevent them from being trafficked. That makes me sigh, because it is a typical Home Office response. The Home Office always assumes that the natural reaction to any problem is enforcement, but our duty in this case is protection rather than enforcement. We tend to mistake those two things and it is a psychological trait of the Home Office always to assume that the answer is enforcement and that is precisely why it cannot always be trusted to come up with policy in this area.

[James Brokenshire]

indicated dissent.

[Sarah Teather]

I am sorry that the Minister is upset, but it means that he has heard me.

If an unaccompanied, vulnerable child turns up at a police station, the police do not put them in a cell, but get in touch with social services. Why can we not do the same for unaccompanied children who come here as migrants or to apply for asylum? Why do we need to detain them? Surely our duty is to protect them. There is plenty of legislation that allows us to do that, and I have not heard an example of detention being required as opposed to protection with appropriate powers of social services.

What really bothers me is whether this is a preamble to a more significant change in policy on the forced removal of unaccompanied, asylum-seeking children. Currently, the United Kingdom does not routinely remove unaccompanied, asylum-seeking children, but it is probably the worst kept secret that the Home Office wants to be able forcibly to remove more unaccompanied children, particularly to Albania and Afghanistan. My concern is that the Government’s amendment leaves wide open the possibility of a drastic expansion of forced removal of children. Instead of moving towards the ending of detention of children for immigration purposes, the clause could allow more unaccompanied children to be detained for the purposes of removal. I am desperately hoping that the Minister will tell me that my fears are ill founded, and I will be delighted if he does so. I hope that he can answer my other specific points about why we cannot simply involve social services and protect children in the small number of such cases instead of detaining them using enforcement powers.

My amendments to Government amendments 6 and 7 also relate to child detention and essentially ask for clarification and strengthening of our 2010 commitment not to split families to achieve compliance with the immigration process. The Minister will be aware that Barnardo’s, which works closely with the Government at Cedars, has produced a report stating that family splits are, unfortunately, sometimes used to effect enforcement of immigration provisions. We agreed in 2010 that we would not do that, and my amendments seek to strengthen that commitment and to make it clearer. In particular, there are sometimes cases when a parent lives away from the family temporarily. The obvious case is when they are in immigration detention, but similar cases are when someone has been sectioned, is in hospital or is in prison. I am worried that the legislation as drafted does not capture such cases or consider the best interests of children, and is not in the spirit of the agreement that we negotiated in 2010.

Finally, I tabled an amendment to Lords amendment 19 to clarify that the best interests of the child should continue to be a primary consideration in all cases involving children. The Joint Committee on Human Rights criticised the Government, saying that they have

“not explained how in practice the provisions in the Bill are to be read alongside the section 55 duty. Without such explanation there is a danger that front-line immigration officials administering the legal regime will be unclear about the relationship between the children duty in section 55 and the new tests introduced by the Bill which use different and unfamiliar language.”

Lords amendment 19 goes some way to meeting that concern, and I explored some of the issues in amendments tabled on Report. It confirms that it is necessary to take into account the need to safeguard and promote the welfare of children in the UK, but I am worried that it does not go far enough because the section 55 duty applies only to the Home Secretary and not to the courts. My amendment makes it clear that consideration of children’s welfare should always be the primary concern. That is necessary because there is growing evidence that recent immigration rules are negatively impacting on decision makers’ understanding of what factors should be taken into account when considering the best interests of children. For example, research last year by Greater Manchester’s immigration aid unit into unaccompanied, asylum seeking children found that, in seven of 10 cases analysed, the Home Office failed to carry out any determination of the child’s best interests. Similarly, last year’s audit of Home Office procedures by the United Nations High Commissioner for Refugees highlighted the lack of any systematic collection or recording of information necessary to determine a child’s best interests. That includes the lack of a process to obtain the view of the child. This proposal simply tries to make sure that the Government do the things they say are their priority. At the moment, the Bill still leaves some confusion.

[Paul Blomfield (Sheffield Central) (Lab)]

I want briefly to seek clarification in relation to international students and the changes that have been made to the Bill in relation to landlord checks. I pay tribute to Lord Hannay and others who have pressed this point in the House of Lords. I regret that students are included in the Bill at all, and I know that many Members on both sides of the House feel that they have no place in this debate.

The point relates to the changes that have given powers to universities to nominate students to occupy accommodation. That is a welcome move, and I am glad that the Government have accepted it. Speaking for the Government, Lord Taylor said in the other place that

“nominating is just the naming of an individual as being a student at a higher education institution…It is a form of vouching for the genuineness of the student’s immigration status. That is all.”

Baroness Warwick asked whether it would be

“legal and proper for the landlord to enter into that arrangement even though at that point, because of the time involved and so on, the potential tenant has not actually got their visa?”

This is crucial, because there is a brief period between being accepted into an institution and being enrolled during which many students sort out their accommodation. In response to Baroness Warwick, Lord Taylor said:

“Yes, absolutely: that is the case.”—[Official Report, House of Lords, 3 April 2014; Vol. 753, c. 1056-1057.]

That involves a potential contradiction.

Will the Minister confirm in his closing remarks, or in intervening on me now, that an institution can nominate a person who has accepted a university place and has been given a confirmation of acceptance to study, but is awaiting a visa, so that they can confirm their accommodation before they have been issued with their visa?

[Mr Harper]

I am grateful to be called to speak, Mr Deputy Speaker. I will make sure that I leave the Minister sufficient time to respond to the points that have been made. I will keep a close eye on you, and if you think I am not leaving adequate time, I am sure you will indicate firmly that I should sit down.

I support what the Minister said in rejecting Lords amendments 16 and 24. I very much want us to deal with those who have been trafficked and victims of modern slavery, but I want us to implement a system that will apply to all children who have been trafficked, and a system that works. I want that decision to be informed by the pilots that the Minister is conducting. That is because in England and Wales the local authority has the legal responsibility to look out for the best interests of those children. In some local authorities, that system works very well, but in many it does not. The legal position is clear, but what is important is not what the law says, by itself, but how it is implemented.

That is why I want to make sure that the Minister runs those pilots and looks at their results. He has clearly stated that he will make sure there is an enabling power in the draft Modern Slavery Bill and that the detail of how we bring these powers into effect can be informed by the pilots. He gave a very clear commitment at the Dispatch Box to use what is learned from the pilots to bring that into force. That is a sensible procedure. I agree with the right hon. Member for Birkenhead (Mr Field): I think there is no disagreement in the points made by him, by the Minister and by the hon. Member for Wigan (Lisa Nandy), who has long experience of these matters. We all want to achieve the same thing, and I want to make sure that it is done in the most practical way possible.

I welcome the moves in amendments 5 to 9 and 29 to 34 to put on to the Statute Book the Government’s current policy on the family returns process. I previously gave some commitments at the Dispatch Box when this matter was raised by my hon. Friend the Member for Cambridge (Dr Huppert), and when the Bill was going through Committee, in saying that the Government would bring forward those amendments in the House of Lords. I am very pleased that my hon. Friend the Minister and his colleague, Lord Taylor of Holbeach, were able to do so. That is a great step forward that locks these provisions into place.

The manuscript amendments tabled by my hon. Friend the Member for Brent Central (Sarah Teather) are not helpful. The issue of an individual living in a household with the child is important. Otherwise, those who have no right to be in the United Kingdom but who happen to have a child here for whom they have no parental responsibility and with whom they have no contact will use that child as a legal tool to avoid being removed from the UK. What is worse, it would encourage people who have no right to be in Britain—a judge set this out clearly in his legal judgment on a specific case in which he jailed the relevant couple—to have children for the specific purpose of avoiding removal from the country. That is not in the interests of children or of the proper working of the immigration system, so I urge the House not to support the manuscript amendments.

17:45

My hon. Friend also addressed the provisions in Lords amendment 8 on the detention of unaccompanied children. I can think of a clear example. She mentioned the need to put children in contact with social services, but relevantly qualified officials are not always immediately available if a child turns up. If there is a delay of a few hours while waiting for a social services person to turn up, the child will, for their own protection, be detained by a Home Office official. That is, technically and legally, detention. If Home Office officials did not have the power to do that, there would be nothing to stop the child leaving the port of entry and potentially coming to harm. I do not think the Minister would be carrying out his duty to protect such children if he allowed that. It is a common occurrence. If Members talk to staff at ports, they will realise that social services officials are frequently not available immediately when unaccompanied children turn up. Technically, therefore, those children are detained. There is a limit on that detention and I think the proposal is sensible.

Overall, the bulk of the Lords amendments are sensible and I hope they will be accepted. I think that the Minister has good reason for wishing us to reject two of the Lords amendments, and I do not think the manuscript amendments tabled by my hon. Friend the Member for Brent Central would improve the Bill. In fact, I think they have the potential to damage the interests of children and I hope the House will reject them.

[James Brokenshire]

This has been a useful opportunity to touch on a number of important issues. In some ways, we have strayed from the strict provisions of the Bill—understandably, I think—particularly with regard to trafficking and the protection of children.

On the pilots and the point of referral, I reassure the hon. Member for Wigan (Lisa Nandy) that the intention is to refer all children suspected of being victims of trafficking to the national referral mechanism. They will be allocated a child trafficking advocate at the point of identification. The advocate will be able to provide support as soon as the child is identified in those first crucial hours. I think that is the point the hon. Lady made. In other words, the child advocate will be available when a child has been identified and the intention is to make a referral to the NRM. I hope that gives the hon. Lady the assurance she seeks. I recognise that, during the initial hours in which a child is identified, they will be very vulnerable and questions will be asked about what should happen to them, so they will need an advocate to support them during that early phase. I am grateful to the hon. Lady for allowing me to provide that clarification.

In response to the Opposition’s Front-Bench spokesman, the right hon. Member for Delyn (Mr Hanson), I have clearly set out our approach to the enabling power. It is important that we crack on with the trials and get those pilots under way, so that effective support can be provided quickly—that children will benefit and that we have the statutory underpinning. I know that the right hon. Gentleman is not satisfied by that and that he supports Lords amendment 16, although it deals only with cross-border cases and covers those up to the age of 21. There is clearly a difference between us. I hope that the House of Lords will consider the points made by the Government and recognise our clear intent and commitment to seek to provide such support.

I want to address head-on the point about student accommodation made by the hon. Member for Sheffield Central (Paul Blomfield), who I know takes a close interest in the issue of support for students and in the sector generally. A tenancy can be offered on a conditional basis when the visa is processed, and we will deal with that point when making the necessary codes and regulations to implement the scheme. I am sure that he will take a close interest in that further detail when it is published after the passage of the Bill. I hope that that clarification will help him and the sector at this time.

My hon. Friend the Member for Brent Central (Sarah Teather) highlighted several points, particularly about unaccompanied children. My hon. Friend the Member for Forest of Dean (Mr Harper) commented on the short-term need—the period in which social services should respond to the arrival of an unaccompanied minor in the UK—and the provision is intended to cover precisely those circumstances. I echo the hon. Lady’s comments about the tremendous work done by Barnardo’s, and she was right to draw attention to the support it provides at Cedars, but that support is intended for a longer period. In relation to unaccompanied children, we are talking about hours, rather than any longer period. Cedars can obviously provide support for a period of days in certain circumstances, as she knows. No unaccompanied child can be detained, but the operational reality is that unaccompanied children may need to be held for short periods in transit to a port of departure or while waiting after their arrival.

We will always seek to ensure that families remain together during their return, although temporary separation may sometimes be necessary to ensure that a family can return safely. We would not separate a family solely for a compliance reason; it will be done only when it is considered to be in the best interests of children for them temporarily to be separated from their parent or when the presence of one of the parents or carers is not conducive to the public good.

On the position of my hon. Friend the Member for Brent Central on Lords amendment 19, the need to safeguard and promote the welfare of children who are in the UK—

17:53

Three hours having elapsed since the commencement of proceedings on consideration of Lords amendments, the debate was interrupted (Programme Order, this day).

The Deputy Speaker put forthwith the Question already proposed from the Chair (Standing Order No. 83F), That this House disagrees with Lords amendment 16.

17:53

Division 267

Ayes: 307

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Conservative: 267
Liberal Democrat: 39

Noes: 241

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Labour: 224
Scottish National Party: 6
Democratic Unionist Party: 5
Social Democratic & Labour Party: 2
Plaid Cymru: 2
Independent: 1
Green Party: 1
Liberal Democrat: 1

Lords amendment 16 disagreed to.

The Deputy Speaker then put forthwith the Questions necessary for the disposal of the business to be concluded at that time (Standing Order No. 83F)

Question put, That this House disagrees with Lords amendment 24.

18:07

Division 268

Ayes: 304

---

Conservative: 266
Liberal Democrat: 37

Noes: 240

---

Labour: 224
Scottish National Party: 6
Democratic Unionist Party: 5
Plaid Cymru: 3
Social Democratic & Labour Party: 2
Green Party: 1

Lords amendment 24 disagreed to.

Remaining Lords amendments agreed to, with Commons financial privileges waived in respect of Lords amendments 7, 16 and 24.

Motion made, and Question put forthwith (Standing Order No. 83H), That a Committee be appointed to draw up Reasons to be assigned to the Lords for disagreeing to their amendments 16 and 24;

That James Brokenshire, Stephen Gilbert, Mr David Hanson, Anne Milton and Phil Wilson be members of the Committee;

That James Brokenshire be the Chair of the Committee;

That three be the quorum of the Committee;

That the Committee do withdraw immediately.—(Claire Perry.)

Question agreed to.

Committee to withdraw immediately; reasons to be reported and communicated to the Lords.

EU Ban on import of Indian Alphonso mangoes

Wednesday 7th May 2014 Commons Chamber

18:20

[Keith Vaz (Leicester East) (Lab)]

If you were at Prime Minister’s questions today, Mr Deputy Speaker, you would know that I asked the Prime Minister about the EU mango ban, a decision taken by the European Union without consulting this House or British Ministers. This vote took place with officials. Last week I asked local residents who were affected by this to gather a petition so I could present it to the House, and in a very short time 329 local residents have signed it—people who regularly buy and eat mangoes and those who sell them. I present this petition today on behalf of Hasmukh Pabari, Darmesh Lakhani, president of the Belgrave road traders association, Joga Sandhu, Shahidullah Khan and Ratilal Patel.

The petition states:

The Petition of residents of Leicester East,

Declares that the EU ban on the importation of Alphonso mangoes from India is unjust, that petitioners are anxious about the hugely detrimental impact that this ban will have on the livelihoods of millions of people in, and on the economies of, both the UK and India, and further declares that there has been a significant lack of consultation with both the Parliament and the affected people.

The Petitioners therefore request that the House of Commons urges the Department for the Environment, Food and Rural Affairs do everything possible to reverse this ban, to develop an action plan on how best to progress in this matter and to better communicate with the people affected.

And the Petitioners remain, etc.

[P001348]

Self-Build and Custom-Build

Wednesday 7th May 2014 Commons Chamber

Motion made, and Question proposed, That this House do now adjourn.—(Gavin Barwell.)

18:22

[Mr Richard Bacon (South Norfolk) (Con)]

It is a great pleasure to have an Adjournment debate on the importance of self-build and custom-build housing, and particularly to do so in national self-build week, so may I start by thanking you, Mr Speaker, for allowing this debate in national self-build week?

Grand Designs Live has been taking place at the ExCeL centre in the last few days and has had over 100,000 visitors, and I know that a number of Department for Communities and Local Government Ministers have attended the event, which was greatly appreciated. It was an excellent thing to support. I also want at the outset to give credit to Mr Ted Stevens for all his work in this area. He runs the National Self Build Association, NaSBA, and he has done much, against the odds, to promote this sector and help people understand that building their own property, or getting a piece of land and getting somebody to build a property for them, is possible.

My interest is as the recent founder and chairman of the new all-party group on self-build, custom-build and independent housebuilding. I should also say at the outset that the term “self-build” is in some ways perhaps almost uniquely unhelpful as it immediately creates the impression that everyone who wishes to do this has to learn how to become a plumber or an electrician or a joiner, and that simply is not the case. Probably the best definition I have come across was in a paper by Alex Morton, then of Policy Exchange, called “A Right to Build: Local homes for local people.” I should say that Alex Morton has done a great deal to promote the interests of this sector and to draw the Government’s attention to its value. In answer to the question about what we mean by self-build, he stated:

“The notion of self-build…does not mean that the entire process is handled by a single individual from start to end. It means that an individual or family has had serious input in the design and construction of a house, a house they then live in for a prolonged period of time.”

At the moment, part of self-build’s image in this country is as running on a spectrum from the “muesli fringe” to the eccentric wealthy wives of hedge fund managers. Those elements do exist, and I say nothing against either of them. We might say that what the muesli fringe are trying to do with community-led, bottom-up solutions is reach for ways of dealing with housing problems in an environment in which they feel powerless. What I would like to do, and what I would like to see the Government do, is make it even easier for their voices to be heard. The idea of a muesli fringe at one end and hedge fund managers’ wives at the other is a caricature. Self-builders make up an important but small part of the housing market, with about one in 10 houses being built in that way.

The self-build market is divided into a number of different components. Perhaps the most established is what we might even call the “established market”, comprising people in their 40s, 50s or early 60s who already own a property and have the cash available to buy a plot, and whose typical budget is in the region of £250,000 to £350,000. Such people are primarily driven by the opportunity to have the home they really want and to reduce running costs. A moot point, which we might deal with later, is why the big national house builders, the top 10 of which are responsible for 50,000 houses a year, do not already build houses that have extremely low running costs. They build houses that have lower running costs than the ones they were building 20 years ago, but it is possible to build a house that costs £200 a year to run, as I found when I visited a Passivhaus in my constituency that was built by the excellent Saffron Housing Trust. As I was told that, I thought that that is exactly the sum we pay out on the winter fuel allowance each year, and it would be much better to have homes that cost little to heat rather than paying so much money to people to insulate poorly constructed and insulated homes of an old design. Of course this goes further than that because, as anyone who has watched “Grand Designs” will know, it is possible to build a house that actually makes people money—it makes an income because it is so fuel-efficient.

The sector I just described, the more established market, is only one part of the self-build market—or the interest for self-build, as I should call it. The potential boom that could arise in self-build will be driven by a different group of people: a younger generation in their 20s, 30s and perhaps 40s, many of whom are struggling to afford a new home and have much smaller budgets, perhaps of £100,000 or up to £200,000. Such people will be driven by the opportunity to have a say in the home they really want, but mainly by the affordability benefit.

One of the most important aspects of this debate is the idea that self-building is an eccentric or odd activity, because in fact the UK is the outlier. Nearly all the other countries in the developed world do this much better than we do. In Denmark 40% to 45% of houses are constructed in this way. In France and Germany, countries that are in many ways comparable to the UK, although France has a bit more land, the figure is more like 50% to 60%. The figure for Sweden is 65% and even the figure for little Austria is 80% or higher. The issue is the structure of our entire market and how difficult that makes it for anyone who would like to self-build to get things off the ground. People often do not have a real or effective choice that they can turn into a reality; it is an aspiration rather than a reality in many cases.

That brings me to the issue of choice in the marketplace. When we ask what people spend most of their money on, we find that for nearly all of us it is where we live, whether we are renting or buying, yet more genuine choice exists in the market for beer, apples or perhaps even toothpaste than in the market for housing. It is an extraordinary paradox that where people spend the most money, they also have the least choice. That happens because of a collision of at least three important facts. The first fact is land—they have stopped making it. There is no land any more—there is a permanent scarcity of land, which leads to fact No. 2: the planning system. There is a plethora of rules and regulations that have been developed over many decades to deal with that scarcity. Thankfully, the Government have slimmed down the planning regulations from an indigestible 1,300 or 1,400 pages to something that the lay person can begin to read and get their head round. That was very much overdue, and I give enormous credit to the Government for doing so.

The system still has to cope, whether there is a 52-page policy framework or whether there are hundreds and hundreds of pages. It has to deal with the intrinsic issue of the tension between competing land uses. Fact No. 3 is the nature of the stock market and our very open capital markets. I mentioned earlier that the top 10 house builders do about 50,000 houses a year; the top 25, including the next 15, do another 25,000. The top 25 are responsible for about 74,000 or 75,000 houses a year. Because they are large and publicly quoted, they have relatively easy access to the capital that they need. They buy up the land that they need to build, and sit on it, land banking it in some cases for years.

“Land banking” is something of a misnomer, because it implies that people buy the land, but they do not always do so. What they often do is buy the option to buy it. They pay a landowner a sum for the right to buy the land for a specified period in future, and by doing so they can obtain the advantages of owning the land—crucially, preventing anyone else from owning it or even trying to buy it—without the inconvenience and cost of capital outlay. That approach, from their point of view, is much more flexible.

The current system does not give large house builders an incentive to become long-term place makers and place shapers. I do not blame large, national house builders for acting as they do: they are merely acting rationally within the constraints of the system. In fact, one could say that large-scale house builders are not so much incentivised as required by the current system to take as short-term a view as possible. They have to get in, build the houses and sell them. They have to pay as small a contribution as they can get away with towards the infrastructure; then they have to get out.

What is the result? Kevin McCloud, the presenter of “Grand Designs” who spoke at a packed all-party meeting—I am pleased that DCLG Ministers attended—said:

“The consumer has been on the receiving end of a pretty poor deal. We build some of the poorest performing, most expensive and smallest homes in Europe. That’s not something to celebrate.”

It could be quite different. According to Ipsos MORI, 53% of the adult population would like to build a house at some stage in their life, and 30% would like to do so in the next 15 years. Some 14% are researching how and what to do, and whether they can finance it. More than 1 million people want to buy a site and start building in the next 12 months.

Much of that is aspirational thinking demand rather than actualised demand, if I can put it that way without getting too Hegelian. The fact is that it is very, very difficult. If someone tries, the first thing they encounter is some official at the council saying, “Have you done the archaeological survey?” They will say, “I’m sorry, I didn’t know that I needed to do an archaeological survey.” At every stage, the process is made as difficult as possible. The two key issues are the availability of land for purchase by individuals and finance. I pay tribute to Lloyds bank, which helped to sponsor the report published by the university of York a year ago. That report was entitled “Build-it-yourself? Understanding the changing landscape of the UK self-build market”. Stephen Noakes, who is a senior official at Lloyds bank and head of mortgages, came to our last meeting with DCLG Ministers.

The university of York report points out—and Mr Noakes from Lloyds bank dwelt on this—the need to create structures that de-risk the process and make it easier for financiers to come in and take a serious interest and a serious stake in this space.

The university of York report states:

“Both individual and group self-build are characterised throughout by uncertainty. In part this is due to the components of self-build being organised as a series of silos and disjunctures. Each step (land acquisition, design, planning, finance etc.) is often taken without any certainty that subsequent steps will be realised. Uncertainty brings delay and sometimes additional costs. Few steps have been taken towards forging more integrated approaches, but these could bring significant benefits in terms of greater certainty, less risk, control of costs and speed of completion.”

A variety of different mechanisms might be used for that. Off-site construction, which is now a completely different world from what it was when we spoke pejoratively of prefabs 50 years ago, is one such example. The Passivhaus that I mentioned earlier, which I visited in my constituency, had triple-glazed windows that were constructed off-site and installed as completed units. Why is it that all house builders in this country do not as a matter of standard policy install triple-glazed windows, because it would be much better and much more energy efficient in the long term?

The Government’s response so far has been quite encouraging. The announcement in the Budget, which did not get a huge amount of coverage, but which I was enormously excited by, was for £150 million to help councils to develop serviced plots. A serviced plot is what it sounds like. It is a plot where, instead of being a scruffy piece of land where people cannot see which bit they own and which bit they do not, the difficult bits have already been done. The roads and sewers have been constructed and the foul and fresh water have been connected for the housing, as have the electricity and the gas. There is a lot of experience of that on the continent. In the Netherlands, where this has been done in Almere, which is just opposite Amsterdam on the other side of the IJsselmeer, if 100 serviced plots are put on the market at the same time, people queue through the night, like they do outside Harrods before the January sale, for the chance to buy one.

There is enormous pent-up demand in this country as well, but it just does not know where to go or how to get a foothold. That is why the Government’s initiative to promote the development of more serviced plots, essentially to take steps towards a much more integrated approach, is so important. It is—I say advisedly—only £150 million. I would have preferred it if it had been even more, but it is not nothing. It will do a considerable amount for the self-build sector. It will make a big difference in the next couple of years. I fully expect it to be a success, particularly as the money is recyclable. The money has to be put in for the plot. Simple mathematics tell us that £150 million for 10,000 plots is £15,000 a plot, but the money is returned, and it can be used again. That is the great attraction of this approach. I hope that once it has proved successful, as I am sure that it will, the Government will take this considerably further.

What I had not appreciated when I started getting interested in this was the breadth of possibilities of self-build and custom-build. My first interest in the sector was spawned by representing a very rural constituency where many young couples simply cannot imagine how they will get on the housing ladder, let alone in the village where they grew up, have a stake in their own community, own their own house and start a family there in the way that they saw their parents do.

The multiple of average income that is required to buy an average house is now nine times, when years ago it was three or four times. The position has got a lot worse even in the past 10 years or so. One has only to look at the decline in the proportion of people who own a house to see how desperate many young people must feel and how difficult they must regard the future in terms of achieving what their parents achieved, which they might have thought that they, too, would be able to achieve.

I have begun to realise that the potential is much wider. I pay particular tribute to Stella Clarke, who runs the Community Self Build Agency in the Bristol area and who came to one of our all-party group meetings with Kevin McCloud, for finding young men from ethnic minorities, who might have been rioting five or 10 years ago, and getting them to the point where they are building a stake in their own community. This is not necessarily about everyone learning how to become a plumber or an electrician, but it is also true that this space does present enormous opportunities for the skills agenda.

Saffron housing association, in addition to doing great work locally, has launched an apprenticeship scheme for micro-businesses that find it too difficult to take on the administration of having an apprentice. It has taken 20 students from Diss high school and said to the micro-businesses, “We will handle all the paperwork for you to have an apprentice. You just take the apprentice.” The scheme has been so successful that the Minister for Skills and Enterprise who is responsible for apprenticeships has been to see it. The scheme will be repeated again this year.

I do not think for one moment that we will all learn how to become plumbers, electricians and joiners, but we should not underestimate the scheme’s potential to help people who have felt marginalised, disaffected and cut out to have a stake in society. They can physically help in the process of building their own stake in society.

Berlin has gone further and proved that this movement can be done at scale, which is why I plan to take a group of parliamentarians and others to Berlin at the end of next month. It is not simply a case of 50 units here, or 100 units there. Some 190,000 dwellings have been constructed in Berlin by self-build and custom-build groups. What is fascinating in Berlin is that the municipality—the local council or the Berlin senate—actively seeks to help. For example, a group of parents will come together and say to the local council that they want to build a block of apartments with a garden in the middle and a school. The social glue that holds them together is the fact that their children all have some special need. The parents have a common interest in developing something that meets their children’s needs. The local council will say, “How can we help you?” If it can be done there, it can be done here. In Berlin, a group of 25 women between the ages of 60 and 70 decided that they wanted to build an apartment block together. They are friends, and if one of them goes into hospital to have a hip replacement, she has 24 friends whom she knows will be there to look after her dog.

The building group model has tremendous possibilities, and the fact that this does not simply mean private individuals for private ownership is under-appreciated. I am a huge supporter of private individuals owning private property and having their own stake in society, but this model has been used successfully in the Netherlands, Berlin and elsewhere for community groups, rent and shared ownership. The possibilities are very broad indeed.

The possibilities for institutional investment are much broader than might first have been realised. If an institutional investor wants to gain exposure to the residential housing market, their option is to buy shares in one of the large national house builders. However, as Saffron housing has proved recently, it is possible even for a small to medium-sized housing association to launch a bond. Saffron recently launched a £125 million bond, which will be drawn down in stages over the next 30 years or so to finance its development programme. If there is an appetite among institutional investors for investing in that sort of vehicle, it is quite possible that if we gave those investors, who anyway have a need to invest for the long term, the opportunity to invest directly in unlocking land and infrastructure, there would be a considerable response, particularly if it were done in a way that coupled their investment horizon needs in a way that enabled place making to occur rather than simply the construction of housing units.

[Paul Uppal (Wolverhampton South West) (Con)]

My hon. Friend is making a compelling speech. I worked in commercial property real estate for 20 years before I came to this place, and the holy grail, particularly on residential property, is to get institutional investment flowing inwards to residential developments. May I just say that that is a non-political point? It is the crucial issue if we are to get housing balanced within the UK.

[Mr Bacon]

I am delighted by my hon. Friend’s supportive intervention. I believe that that is achievable, as there is institutional appetite and institutional demand out there. The thing that I find extraordinary about the current residential housing market, which to me proves that there is a systemic problem, is that we seem either to be almost in a state of sclerosis, with almost nothing happening and all the land on which anything might happen being optioned up to the hilt by large-scale house builders, so that individuals and small commuter groups can simply cannot get hold of it, or to be almost perpetually talking about the next housing bubble and how we need to dampen down demand.

On that point, I do not believe that the Help to Buy scheme has been a contributor to any putative housing bubble. I feared when it was launched that that would be the case, and we considered the issue in detail in the Public Accounts Committee when we took evidence from Sir Bob Kerslake as permanent secretary at the Department for Communities and Local Government. It is absolutely clear, and would be to anyone who considered the evidence, that the Help to Buy scheme has not contributed in any significant way to a housing bubble.

The housing market cannot function as it should, in a reasonably non-volatile way, if we swing between these wild extremes of inactivity and housing bubbles when the need for people to have a roof over their heads does not go away. It is a sustainable long-term need that ought to be capable of being met through institutional investment that is, after all, looking for a long-term sustainable return. I do not think that it is beyond the wit of man or woman to link those two, and there are interesting possibilities, although in this short debate I shall not have time to explore them fully.

After the Budget, I stopped an aide of the Prime Minister in the corridor to thank him for the £150 million provided in the Budget for serviced plots. When I explained that it was for self-build and the nascent but not yet legalised right to build that we want to see, his instant response was to say, “Oh, I want to do that.” The number of people I have conversations with who say, “Oh, I have always wanted to do that,” is why I believe the Ipsos MORI figures.

There is a difference between having an aspiration and being able to do something about it and there is such a big gap between the two because of the structure of our housing market, which does not really meet customers’ needs. The Government have made an enormously important start with this £150 million. This approach could become the new normal, but the fundamental shift that we need is to start treating the building of houses as if customers mattered.

18:47

[The Parliamentary Under-Secretary of State for Communities and Local Government (Kris Hopkins)]

I congratulate my hon. Friend the Member for South Norfolk (Mr Bacon) on securing this debate and pay tribute to him for his work as chairman of the new all-party group on self-build, custom-build and independent housebuilding. I appreciated the opportunity to address the all-party group a few months ago. Let me also put on record my appreciation for the massive contribution that Ted Stevens has made to the custom-build and self-build industry, driving it forward positively.

As we have heard, my hon. Friend is very passionate about this issue and is a persuasive advocate of custom and self-build housing. He has rightly highlighted the huge potential that broad sector has to help support the need to build more houses in this country. The debate could not be better timed. As he mentioned, we are in the middle of the second national custom and self-build week, which was launched on Saturday by my right hon. Friend the Secretary of State for Communities and Local Government at Grand Designs Live. That is an initiative that my Department is delighted to support, as it draws national attention to the huge potential of this form of housing to become a mainstream housing option for any aspiring home owner in this country.

Why does this question matter to the Government and why do we support the sector? Unlike the previous Administration, who did absolutely nothing to support self-builders and custom-builders in this country, the Government are committed to and are offering strong support to this part of the sector. We face a huge challenge in building the number of homes that are needed, and we must look at all opportunities to stimulate that supply. Supporting more self-build and custom-build housing is part of a much bigger package of housing supply initiatives the Government are introducing to get more homes built. Some 165,000 affordable houses will be completed next year to add to the housing supply. We have just closed on bids to deliver another 170,000 houses in the years to 2018. We have allocated some £1 billion to deliver 10,000 houses in the private rented sector and we have launched a prospectus to encourage councils to bid for £300 million to deliver housing across the sector.

My hon. Friend kindly mentioned the Help to Buy scheme, and I agree that it is a huge encouragement to enable people to get on the housing ladder. Some figures have been issued in the last 24 hours that are pertinent to the debate. Under the Help to Buy scheme, the average mortgage is £145,000 with an average deposit of £36,000. While it is a vital part of our offer on housing, it constitutes only 2% of transactions, and I do not believe it is fuelling a bubble.

Many people would love to own their own home. As my hon. Friend said, research by Ipsos MORI has shown that more than 1 million people want to do so in the immediate future. That strong level of interest is not surprising. Custom-build and self-build housing offers people more choice and the ability to design a home to suit their own needs, leading to greener and better designed homes. In many cases, that is more affordable than buying a home in the conventional way. A report published by Lloyds Banking Group concluded that self-builders can save between 20% and 25% on the cost of an equivalent home on the open market, a crucial saving for those who are trying to get on the housing ladder.

There are wider benefits. A strong custom-build sector helps diversity and strengthens our house building industry, bringing new opportunities for medium and small house builders. It can also speed up the supply of new homes where there is strong demand for plots. It sustains and creates new jobs and supports local economies. As my hon. Friend said, it helps young people who are going into apprenticeships and vocational jobs—an important part of the economy—which are facilitated by this type of build.

Let us be clear. The custom-build sector already makes an important contribution to our housing supply with around one in every 10 homes being built or commissioned by individuals. That is much more than many volume builders are already building. It is important to say that custom-build and self-build are already facilitating a turnover of around £4 billion per year.

There is significant growth potential in the sector. Among our European neighbours, more than half of all new homes are built and commissioned by self-builders—about 60% in Germany and more than 80% in Austria. We must do more to facilitate that, which is why we have looked at our national planning policy framework for land to ensure that councils can assess and plan for the needs of people who want to build their own homes. I encourage my hon. Friend and the all-party group to contribute to the call by Nathalie Elphicke and Keith House for evidence on how to get and utilise more local authority land for building houses.

As has been mentioned, there is a real challenge in securing finance. We have launched a £30 million custom-build homes fund to provide repayable finance for larger custom-build developments. We have given self-build groups access to some £65 million under the affordable housing guarantee programme. We are engaging with lenders to ensure that there are more self-build mortgages available in the sector.

This Government now have a strong reputation for removing red tape. Self-builders are now exempt from the community infrastructure levy, potentially saving them thousands of pounds on individual projects. We have just finished consulting on a similar policy to change section 106 charges. We have also simplified design and access statements and made it easier to change the use of buildings to housing, which the industry has welcomed.

An important aspect is making sure that we can get advice out to consumers and developers. We have worked with the custom and self-build sector to launch an online portal to provide better information for self-builders. It has received more than 35 million hits and now attracts about 20,000 new users each month. That is fantastic progress and a clear demonstration of the interest in this sector. We were delighted to be able to secure Kevin McCloud as the new industry champion. He is doing an excellent job in raising public awareness of the benefits of custom-build. We have worked closely with the National Self Build Association to facilitate a range of new guides and advice to councils, developers and consumers on self-build and custom-build housing.

We have had some successes to date. There are up to 5,000 new plots in the pipeline and many new projects coming forward across the country, with thousands more to come. Some 60 councils have brought forward land and new initiatives, including Stoke, Cherwell, Woking, Hereford, Cambridge and Newcastle. We now have 26 lenders who are interested in this sector—10 more than in 2011. We have cut red tape, as I mentioned, and put portals in place to make sure that people have access to information. Making custom-build a mainstream housing option is very important for this Government, but we recognise that there is still a long way to go in doing so. The next step is to end the myths about this sector, and that will be a significant move forward.

In the Budget, we made some major commitments to driving this forward. I recognise and appreciate my hon. Friend’s comments about the consultation that is about to take place on right to build. That proposal recognises that some councils already provide land for custom-build, in response to local demand. We want to encourage that further. We will identify a small number of councils that want to act as vanguards to test how the right-to-build model would work in practice. We have been very generous, I might say, in providing £150 million in repayable finance. As he said, there is the potential for more if we can get the traction we need. The idea that we can recycle that money is extremely important. We want to get those shovel-ready plots out there delivering 10,000 custom-build houses.

[Mr Bacon]

My hon. Friend mentioned a couple of points that I want to test him on. The community infrastructure levy was removed from self-builders, rightly, although that creates a financial incentive for local councils to be less keen on self-build because they do not get the benefit. Does he agree that it is absolutely vital to hold the feet of local councils to the fire in fulfilling the duty that has now been placed on them to measure demand for self-build and to say what they are going to do about it?

Does the Minister also think that there is scope for encouraging enlightened national house builders with large land banks—some of which are at an advanced stage and some of which are less so—to make a proportion of that development available for self-build? If they did, they would probably sell them rapidly and that would encourage them to do more.

19:00

Motion lapsed (Standing Order No. 9(3)).

Motion made, and Question proposed, That this House do now adjourn.—(Gavin Barwell.)

[Kris Hopkins]

On councils, my hon. Friend will forgive me if I leave contemplations about the community infrastructure levy to the planning Minister, the Under-Secretary of State for Communities and Local Government, my hon. Friend the Member for Grantham and Stamford (Nick Boles). What I would say, as a former council leader myself, is that, in the majority of cases, we are building houses for people who live in those communities. Really strong leadership is about understanding demand and this particular way of responding to it. I want more councils to embrace that and we need to encourage them to do so. We need to provide leadership from this House by offering guidance through the right to build and other measures that demonstrate that there is a clear outcome for communities and the individuals who live there.

I have seen lots of evidence that the major builders are not land banking, but that does not mean that there is not huge potential, particularly for local authorities that own a vast amount of land. I encourage my hon. Friend the Member for South Norfolk to respond to the call for evidence from Elphicke and House, which I think will begin to shape the debate about this part of the housing offer, which will be facilitated by the local authorities that own that land.

I have touched on the Budget. We want to look at how we can extend the Help to Buy equity loan scheme. High-level conversations are being held about how we can facilitate that and we will make further announcements in the future. It is important to make sure that we provide support to the sector through Help to Buy and, in particular, to understand the demands of the sector. Money will be released in stages for a custom-built house, while it is usually released in one transaction for a conventional build.

I wholeheartedly agree with my hon. Friend that custom and self-build should be—and I hope will be through our efforts—a mainstream housing option in this country. Given the Government’s measures and the support of my hon. Friend in challenging the myths about custom and self-build, I believe we are firmly on the path of realising that ambition. I again thank him for securing this debate and look forward to working with him and other hon. Members to help support this important sector and enable more people to realise their ambition to build their own home.

Question put and agreed to.

19:03

House adjourned.

Division 264

Ayes: 313

---

Conservative: 263
Liberal Democrat: 44
Democratic Unionist Party: 5
Independent: 1

Noes: 205

---

Labour: 201
Social Democratic & Labour Party: 2
Plaid Cymru: 2
Conservative: 1
Green Party: 1

Ministerial Correction

Wednesday 7th May 2014 Ministerial Corrections

Wednesday 7 May 2014

Home Department

Wednesday 7th May 2014 Ministerial Corrections

Hillsborough Stadium

[Steve Rotheram]

To ask the Secretary of State for the Home Department what deadline she has provided to chief constables by which they must hand over any evidence to the Independent Police Complaints Commission in relation to Hillsborough.

[Official Report, 8 April 2014, Vol. 579, c. 202W.]

Letter of correction from Karen Bradley:

An error has been identified in the written answer given to the hon. Member for Liverpool, Walton (Steve Rotheram) on 8 April 2014.

The full answer given was as follows:

[Karen Bradley]

The Minister for Policing, Criminal Justice and Victims, my right hon. Friend the Member for Ashford (Damian Green), wrote to all chief constables on 4 March 2014 to request that all police forces search their records to establish whether they possess any material that relates to the Hillsborough tragedy. The Minister asked if this could be completed by 4 April 2014 and asked that every police force responds, even if it is to record a nil response.

The correct answer should have been:

[Karen Bradley]

My right hon. Friend the Home Secretary wrote to all chief constables on 4 March 2014 to request that all police forces search their records to establish whether they possess any material that relates to the Hillsborough tragedy. The Home Secretary asked if this could be completed by 4 April 2014 and asked that every police force responds, even if it is to record a nil response.

Petition

Wednesday 7th May 2014 Petitions

Wednesday 7 May 2014

Crossing at Gipsy Lane, Leicester

Wednesday 7th May 2014 Petitions

The Petition of residents of Leicester East,

Declares that the zebra crossing on Gipsy Lane, Leicester is unsafe as the drivers do not stop long enough, they drive through when pedestrians are half way across the road and further declares that the Petitioners are concerned that there is an accident waiting to happen on this road.

The Petitioners therefore request that the House of Commons urges the Department for Communities and Local Government and Leicester City Council to investigate installing a pelican crossing at this site.

And the Petitioners remain, etc.—[Presented by Keith Vaz, Official Report, 27 March 2014; Vol. 578, c. 565.]

[P001337]

Observations from the Secretary of State for Transport:

The design, installation and maintenance of pedestrian crossings are matters for local highway authorities. They have powers to establish crossings on their roads, as well as a duty under section 122 of the Road Traffic Regulation Act 1984 to “secure the expeditious, convenient and safe movement of vehicular and other traffic (including pedestrians)”.

Local authorities would need to consider local factors such as pedestrian numbers, road layout, traffic flow and speed and accident records in deciding whether a crossing is necessary, and if so what type to provide. The Department for Transport has published guidance on the assessment and design of pedestrian crossings, in two Local Transport Notes (LTNs):

LTN 1/95: The Assessment of Pedestrian Crossings

LTN 2/95: The Design of Pedestrian Crossings

Both publications are available on the Department’s website at:

https://www.gov.uk/government/publications/local-transport-notes

If this crossing is a Pelican Crossing then it may be worth considering replacing it with a Puffin Crossing which includes the capability of detecting people waiting and crossing.

Local authorities are free to make their own decisions about the design of the streets under their care, provided they take account of the relevant legislation. It would be inappropriate for the Government to seek to intervene in the process of local democratic accountability.

The Coalition Government have pledged to protect and extend the autonomy of local authorities, and as such do not intervene in their day-to-day affairs, except where specific provision has been made in legislation.

Westminster Hall

Wednesday 7th May 2014 Westminster Hall

Wednesday 7 May 2014

[Mr Graham Brady in the Chair]

S4C and Welsh Identity

Wednesday 7th May 2014 Westminster Hall

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

09:30

[Glyn Davies (Montgomeryshire) (Con)]

As always, wherever we are, it is a pleasure for me to speak under your always fair chairmanship, Mr Brady.

S4C and its link with cultural identity are hugely important and a matter on which there is a large measure of agreement across all parties and among all Welsh MPs, so I would have liked to have had a lot of Members from other parties present for the debate and a good audience. Unfortunately, however, we clash with the Welsh Grand Committee, which Members must attend because it is an important meeting to discuss the recent Budget, so I fear that we may be short of the sort of numbers that I might have expected. That is not a reflection of the interest of Welsh MPs in the future of S4C, because interest is strong.

My personal interest became much more exaggerated in the 1960s and 1970s, when I became much more aware of my identity and of the person I was, as we do when we get older. That was when I realised I was Welsh to the core; first and foremost, I would always say that I was Welsh. I have looked through lists of my ancestors, and I do not have a single one who was not born in Montgomeryshire, Sir Drefaldwyn. Every single one was a first-language Welsh speaker—I have gone through books that people have written.

In the 1960s, my generation—my five sisters and I—was the first not to speak Welsh; we spoke only English. When I became a Member of the National Assembly for Wales in 1999, the sense of identity was such that I felt that I had to learn to speak Welsh. Since then I have become bilingual, and if anyone were to ask me what I was proudest of doing in my life, one of those things would be becoming bilingual in the language of my nation.

People have asked me why I sought today’s debate. It stemmed from a meeting I had with the chief executive of S4C, in which we talked about the budget and programme development—I will come on to that. It was a chance conversation, three years on from the trauma that we experienced when we broke the inflationary link, in terms of guaranteed funding for S4C. We also changed the arrangements for the funding, so that it came via the BBC Trust, from the licence fee. That change was huge, and it was a sensitive issue, causing a huge amount of trauma in Wales.

Another factor in the timing of the debate is that we have a new Secretary of State for Culture, Media and Sport. There must be something of an induction course for the new Secretary of State, because he will see that the S4C issue is not a quiet one. When it raises its head, it might well be on his desk more than he expects. The issue is important, and he needs to be aware of just how important S4C, the Welsh language and the cultural link between them is to the Welsh people.

S4C is inextricably linked to the language and Welsh identity. More than anything else, it is the Welsh language that makes Wales special. If we look at a nation, we wonder what it is that makes it distinct or special, and the Welsh language is what makes Wales special. As I said, my first interest in Welsh identity, including in the language, developed in the 1960s. At that time—this might come as a shock to my colleagues—I won a bardic chair. I wrote a 20,000-word essay on the future of the Welsh language. It might cause some amusement to hear that my pseudonym was Taurus ap Tomos; make of that what you will.

The conclusion of my essay was pessimistic, although not an unusual one in the 1960s: it was that the Welsh language would disappear as a used language in the long run. We have made a huge advance since then, because that is not something that people would say today. It is easy to forget just how negative we were.

Before 1982, there was a lead-up to the establishment of S4C. Some Welsh language programmes appeared in the 1960s and 1970s on other platforms, such as the BBC and HTV Cymru. Before the 1979 general election, there was a big debate about whether a new Welsh language channel would be created. It was created, although there was a bit of a hoo-hah after the election. The Government of the day were facing a lot of economic and budgetary pressures. There was a lot of support for a new channel; the Welsh community came together and applied pressure as well, as they did three years ago, too. The then Government, led by Mrs Thatcher, created S4C in November 1982, and that was a huge stepping-stone.

Despite the hoo-hah leading up to it, the creation of S4C under a Conservative Government is something that I can look back on as a huge step forward for the language. If we look at the record of the Conservative party, creating S4C was not the only thing it did: the Welsh Language Act 1993 was another huge step forward, and the creation of the Welsh Language Board was another Conservative initiative.

I am therefore proud, not only of the 1982 creation of S4C—there can be debate about how that happened; there was the influence of Gwynfor Evans’s threat to fast to death, and Opposition criticism of the prevarication in introducing the necessary Bill—but of its budget. Ever since the beginning, there has been a good and adequate budget. S4C has been good value. In 1991, the guaranteed link with inflation was introduced, and that funded the channel on a confident basis right up until 2010, when the incoming Government faced a similar position to that of the Government who came to power in 1979: there were huge threats to the economy and a need to cut back on public expenditure, which lead to substantial debate.

There is room for much debate on the impact of the inflationary link. I was pretty nervous about breaking that link, as all of us probably were. In the end, I accepted it. There has been a positive element to the inflation link: S4C had a guaranteed income in a business in which forward commitments need to be made, and independence from Government interference. However, being a statutory link, an element of complacency arose, as it does when there is a guaranteed income. That guaranteed income meant that S4C had to keep thinking not about its market, but about satisfying the people in control of paying it. Breaking the link was important.

It was quite an experience being involved in breaking the link. I served on the Committee that examined the Public Bodies Bill. I had 1,200 e-mails on the issue, which is four times more than on any other subject since I became an MP. After I had spoken—or it might have been my vote that did it—I became something of a target. We even had someone carted out of the Public Gallery, because they were disturbing a debate. There was a huge rumpus in Wales. I was being doorstepped all over the building by various people lobbying. That showed me that the people of Wales really cared about their channel. They were worried that changes would damage it, although over the past three years, things have worked out okay.

There was a second big change: rather than being funded directly from Westminster, the channel is now funded from the licence fee through the BBC Trust, an issue that has raised its head this morning. A lot of people worried about that change at the time, and have been worried since. Their worry is that we need an independent S4C that is not influenced by a paymaster—that is, not influenced by the BBC. I must say that the relationship between S4C and the BBC in Wales is terrific—better than anybody could have expected.

The comments we have heard today are a bit overblown. The director of BBC Cymru Wales has made comments about viewing figures at peak hours, which might be perceived to be about wanting to influence the managerial side of S4C, but I am not sure that that is right. It is crucial that S4C is free and independent—editorially, operationally and managerially. The slightest suggestion that there might be some interference in that has caused a huge hoo-hah. In a sense, I welcome that, as it emphasises just how important that independence is.

[Jim Shannon (Strangford) (DUP)]

As an Ulster Scot, I am very aware of the need to preserve and encourage identity. In Northern Ireland, 35% of the population see themselves as Ulster Scots—that is 250,000 people from a population of 1.7 million—so I understand the identity that the hon. Gentleman is trying to preserve. The issue is important for us as well. In Northern Ireland, we have BBC channels and programmes that promote our identity. Does the hon. Gentleman see S4C and also the BBC as conduits to enable others to have input into the Welsh identity and language?

[Glyn Davies]

Indeed I do. S4C is particularly important because it is a Welsh language channel, but of course BBC Wales is hugely influential. It is a discrete part of the BBC and is committed to the language. It works closely with S4C, providing programmes, and the relationship is very good. That was not always the case, but it certainly is at the moment.

There is one aspect of the Public Bodies Act 2011 on which I would like a reassurance from the Minister—I am sure he will be happy to give it. Section 31 states that the Secretary of State for Culture, Media and Sport must ensure “sufficient funding” to deliver a Welsh language channel in Wales. That is rather imprecise. However, it is important that it is stated in the Act that the Secretary of State should do that.

My focus today is on the link between S4C and the language, because that is what I think is most important, but to a lot of people, the importance of S4C is about not just the language but the contribution that it makes to the economy. I was involved in economic development for the whole of Wales around the time that S4C was created. There was a blossoming of the creative industries. A huge number of small businesses set up in parts of Wales where there had been depopulation, and to which it was difficult to attract other forms of business. S4C does not produce its own work but commissions it, and a large proportion of those commissions go not to the BBC but to independent companies. Today we have four major companies that produce work for S4C. Those include: Boom Pictures, a successful international company; Tinopolis, a major company that produces “Question Time”; Rondo; and Cwmni Da, a company that has sold programmes to China.

We should not forget, however, that the last thing we want is for S4C to drop into a comfort zone. We need to make certain that it is not just the four established companies with good relationships with S4C that continue to get all the work, and that there is still that blossoming of new, small companies in the more remote parts of Wales where it is still more difficult to develop the economy.

[Guto Bebb (Aberconwy) (Con)]

My hon. Friend makes an important point about S4C’s contribution in commissioning work from smaller companies. Remarkably, since the reduction in funding, the variety of companies supplying work for S4C has increased, whereas before the reduction, companies—especially those from the north-west—saw a significant contraction in the number of programmes that they supplied to S4C.

[Glyn Davies]

Indeed. I was not aware of the precise way in which the creative industries had developed in Wales, but it is generally known that over the period leading up to the break in the funding link, there was a real fall-off, with too much concentration on Cardiff-based companies. Members for Cardiff might feel cross about that remark, but the key thing about S4C is that small companies can operate in areas where the language has traditionally been strong. We must not forget that. We do not want to return to complacency—a comfort zone in which we have what we have and S4C does not look to continue to develop new companies that can become the big successes of tomorrow.

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

My hon. Friend will have heard that S4C is moving its headquarters to Carmarthen. The economic contribution that that will make across west Wales is profound. His point is a good one, and one that S4C is beginning to realise itself.

[Glyn Davies]

I agree with my hon. Friend. There will obviously be views on whether S4C should move from the capital, where political activity is mainly based and the creative industries are concentrated, but the move is the right one. Where the language is under most threat is in what I term the heartlands, where Welsh is still the language of the street—Carmarthen is one of those places. Those are the areas where we have seen the biggest loss in Welsh speakers and where S4C can play a role in helping to stabilise any decline in the language.

[Albert Owen (Ynys Môn) (Lab)]

I congratulate the hon. Gentleman on securing this important debate. I am hugely impressed by his prize-winning background— I had not heard about that until today. He is making an important point about the Cardiff-centric nature of institutions in Wales, which is a real danger. Does he agree that over the past few years one issue has been that Welsh-speaking people have been drawn to Cardiff and have settled in the Cardiff area, which has had an impact on the Welsh language in communities throughout Wales, in particular in north-west Wales?

[Glyn Davies]

I thank the hon. Gentleman for that point—I can only agree. It is inevitable, and in mid-Wales, where I live, it happened in a huge way—the population was disappearing completely. That is what developed my interest in public affairs. When I left school, I was the only person in the academic stream who stayed in the area; everybody else had to leave to find a job of any value of to them. But that trend has reversed to a large extent, as the numbers show: in Montgomeryshire, the numbers fell from 50,000 at the start of the last century to about 36,000 mid-century, but are back up to 50,000, so they went down but have come back up again. That is partly to do with the regional development policies of the Conservative Government of the 1980s, who invested greatly in the rural part of mid-Wales with great success.

[Mr Mark Williams (Ceredigion) (LD)]

Like others, I congratulate my hon. Friend on securing this debate. To return to education and the importance of the language, does he agree that an essential role of S4C has been to buttress education policy in schools? It is not a tool of Government policy but has meant that children from an anglicised background have had the Welsh language made familiar in their homes in a natural way. Does he also agree that evidence for the fact that S4C is in no way complacent is the international success of many of its commissions, not least “Hinterland”, which was filmed in Ceredigion?

[Glyn Davies]

Indeed. The only difficulty I had with the programme was that it rained pretty much throughout the whole first episode and was probably not particularly helpful to attracting tourists to Ceredigion. However, I have watched the later episodes, and I must say that it is a hugely successful programme.

My request for today’s debate was instigated by my meeting with S4C to discuss future funding. Decisions on programming have to be made two or three years ahead, and those making the decisions need to have an idea of what their budget will be. Although most of S4C’s budget comes from the licence fee, which is fairly certain, a certain amount comes from the Westminster Government—from DCMS—and is guaranteed for only a limited period. Programmes such as “Hinterland” take more than two years to deliver, from first discussions to delivery, so to commit to a programme such as that, which is hugely successful and will be internationally successful, a fair degree of certainty is needed. That is one of the main reasons I requested today’s debate, in the lead-up to consideration of how S4C will be funded. The licence fee we know about, and the Minister may have already started discussions on its future. Officially, they will probably start after the next election.

I know that S4C will deliver a document later this month to start the process of discussing what S4C will be from 2018 onwards. The agreement is that that will be considered. The issue is long-term funding in the creative industry. If we are going to have good and internationally successful programmes such as “Hinterland”, we need to have a period in which the board and chief executive of S4C can commit to delivering programmes in two years’ time, and that requires some certainty about the budget.

The next point I was going to make was the move to Carmarthen; I will make it again to satisfy my hon. Friend the Member for Carmarthen West and South Pembrokeshire (Simon Hart). I have said what I was going to say, but I just thought that I would say it twice to make him happy.

Very soon now—or perhaps it has already started—the Secretary of State will be starting the long process of reviewing the BBC’s charter, and part of that will be its relationship with S4C and the continuation of the funding stream. There will also be discussions, which I hope hon. Members will be part of, about S4C deciding what sort of organisation it wants to be. There will be big changes—nothing stands still, particularly in the fast-moving world of the creative industries. There has to be a serious look at how much money comes in from advertising: if that is part of S4C’s funding, that has to be taken into account, because it relates to audience figures. When I see headline audience figures, I never really trust them, because we have to look at the whole picture and what is behind the figures. S4C produces a lot of children’s programmes, which do not count in the measurement although it has been incredibly successful in that field, exporting all over the world. Also, there is a big move by all television channels to online programming, which inevitably leads to a reduction in audience figures. We have to look at the issue in the round before we make a judgment about viewing figures. There will be a significant debate about the sort of S4C we want. As I said, I think S4C is producing a document later this month. That will be a chance for us to start engaging with it.

The United Kingdom has been a hugely successful entity for centuries. A key part of that is that each nation in it, whether Scotland, Wales or Northern Ireland, has to feel a sense that it is belonging to a team and that its differences and uniqueness are properly recognised right across the UK; that the whole team recognises its special features. In Wales, we have a special language, which about 20% of people speak; it is hugely successful. We have probably stopped its decline, but there has to be a constant and continuous battle. It is a minority language—I am not sure that Welsh is absolutely a minority language; it is probably just classed as such, and it does not seem to be a minority language any more in Wales—and it is under threat. There is a constant battle to protect and boost it. That has to be respected throughout the United Kingdom, not just in Wales, where we all know about it, but in England, Scotland and Northern Ireland. That is why it is important that we have a debate about S4C, the language and the identity of Wales here in the UK Parliament. That is why I have secured today’s debate and why I have enjoyed sharing my views on the issue with hon. Members.

09:55

[Susan Elan Jones (Clwyd South) (Lab)]

It is a pleasure to serve under your chairmanship, Mr Brady. I join my hon. Friend the Member for Ynys Môn (Albert Owen) in congratulating the hon. Member for Montgomeryshire (Glyn Davies) on securing this important debate.

Only last year, we were here to celebrate the 30th anniversary of S4C as the world’s only publicly broadcast Welsh language channel. Although at times the existence of the channel has been taken for granted, its importance to the people of Wales has not diminished in the slightest. As I said in the anniversary debate, the existence of S4C is a reminder of a diverse history of people—some of them famous, some of them pretty much establishment figures, and some of them definitely not establishment figures—all of whom came together to campaign for the Welsh language at a time when it was not fashionable to do so. That is important for us to remember. For some, it was a campaign that came from our universities and from this place; for others, it was a different campaign that involved refusing to pay their television licence; but for all those people, from wherever they came, we can never say too many times that we—that next generation of people active in Welsh political life—are in their debt, because without them, the channel would not have been created.

As the hon. Member for Montgomeryshire said, we often have very personal reasons why we are so supportive of S4C. He took us through his own journey in the 1960s—one wonders whether he was long-haired and hippyish in those days, or merely a prize winner at cultural festivals. My personal experience was that of growing up in a bilingual community, where English was the language of the home, so for me S4C was not only a nice way to have a bit of extra Welsh, but a way of enabling me to study Welsh at first-language level at school. It was also the mechanism that normalised the use of Welsh for me, and I know that that is true for many other people. The hon. Member for Ceredigion (Mr Williams) mentioned earlier the crucial importance of S4C in education. For people like me, it was the station that I could listen to when most of the Welsh speakers I knew were people who dealt in Welsh almost 24/7.

I know that that is even truer today. Many children who go to Welshmedium schools are without the advantage that I had of being in a bilingual community. It is an advantage, too, for non-Welsh-speaking parents who are trying to learn the language; for the wider community of people who are unable to speak Welsh themselves, but who are determined, as my father was, that it should be passed to the next generation; and for families with only one Welsh-speaking parent in London, Liverpool or even outside the United Kingdom who are trying to bring up their children to speak Welsh—no easy task and a tough challenge for families living outside Wales in an increasingly globalised world.

I do not propose to tread over old ground in this debate. The Minister remembers many of us from a few years ago. We remember that he watched “Fireman Sam”; I am sure that he has watched a lot more than that now. Many of us had real fears for S4C’s independence and funding when we tried unsuccessfully to get it removed from the Public Bodies Bill. We saw disproportionate cuts that meant S4C’s grant was reduced from £101 million in 2010 to £83 million in 2012. We saw it being chucked away. We have seen reductions of 1% in 2013-14 and 2% more in 2014-15, which clearly places stress on a channel that has already had to cut costs wherever it goes. The hon. Member for Montgomeryshire described the experience as traumatic and talked about the difficulties of breaking the inflationary link. We must not forget, whenever we discuss the subject, that UNESCO classified the Welsh language as “vulnerable” and that S4C is the only television channel in the world that broadcasts in that language. To protect the language and not to allow it to disappear, we must support institutions such as S4C that use and promote the language successfully.

That is why I am asking the Minister today for a cast-iron assurance. Given the way the governance and funding of S4C were changed by this Government in 2011, the commitment to funding S4C needs to be included, and indeed, spelt out in the next BBC charter and in the negotiations. There can be no ambiguity about that. If S4C is to invest and thrive, a proper, costed commitment needs to be in there. I very much take on board what the hon. Member for Montgomeryshire said about its importance for the channel in planning ahead, and I would be grateful for a response from the Minister on that point.

However, if I want to make a challenge to the Government, I also want to make one to S4C. I know that S4C has decided to move its headquarters from Cardiff to Carmarthenshire. The hon. Member for Carmarthen West and South Pembrokeshire (Simon Hart) rightly spoke of the benefits to west Wales, and of course if I had been a west Walian I would have welcomed that. An often quoted figure is that £1 of investment into S4C brings about £2 into the Welsh economy, and the siting of the S4C headquarters in Carmarthen will bring undoubted benefits to that part of Wales.

Of course I realise that, realistically, the headquarters of S4C cannot be everywhere, but I want a commitment from S4C that its partnership working will be in all parts of Wales. A huge proportion—more than three quarters, I think—of S4C’s programmes are made by the independent sector, and we need a commitment from the channel that those companies will be chosen from right across Wales. That should not stop with direct commissioning; I want the institutions with which S4C does partnership working to be Wales-wide, too. That is critical.

S4C is very important to people all over Wales. It is important to people who speak Welsh, to those who are learning and to those who wish to learn. It brings people together and makes the Welsh language accessible in an age when modern media force us sometimes to question the nature of our cultural identity. I have no doubt that as long as Welsh people live and breathe, which, of course, will be for ever, the debates about Welsh cultural identity and the Welsh language will increase, not diminish. However, it is my hope that as the debate develops, we will not all sit in our respective partisan or ideological silos, but we will be open to good ideas from wherever they come. I hope that we will not only debate the channel directly, but look at other things connected with the Welsh language—for instance, the whole system of teaching Welsh as a second language. Last summer, I joined Ann Jones, the Labour Assembly Member for the Vale of Clwyd, and many other people in the letter campaign organised by the veteran Welsh language campaigner Ffred Ffransis, arguing that it is time for a thorough look at the system of second language Welsh education.

We also need to begin the debate again about distinctive policies for our heartland Welsh-speaking communities. I do not say that in any trite fashion: if we do not do this now, in 30 years’ time we are simply not going to have any. It is time that we at least consider models such as the Irish model of the Gaeltacht as one way of revitalising Welsh-speaking heartland communities. Wherever our debate on the Welsh language takes us—I believe that we have to very open and refreshed in our thinking on that—I am confident that S4C and its partnerships with Welsh creative industries will always be a vital part of it.

10:04

[Alun Cairns (Vale of Glamorgan) (Con)]

It is a pleasure to serve under your chairmanship, Mr Brady, and I add my congratulations to my hon. Friend the Member for Montgomeryshire (Glyn Davies) on securing the debate.

As I look at the Minister, I think he has probably participated in more debates on S4C than many other parliamentarians before him. He will remember the turbulent time that ensued after the 2010 general election, with the financial crisis that needed to be acted on. I was going to say that this is the first debate we have had while S4C is in a settled form, but the hon. Member for Clwyd South (Susan Elan Jones) reminded me of last year’s debate on the 30th anniversary of S4C. That was an important marker to underline the significance of the channel and the cross-party support that exists and remains for it.

I want to go back over a couple of points in history. The Conservative record on S4C is extremely proud, having established the channel in 1982 with all-party support—it is important to recognise that—and it has had fantastic success over that period. It has received a number of Oscar nominations and several awards that we could cite. Animation, particularly, was a great success. It could be used across the globe in local languages and provided a major income earner for the channel, as well as the development of a skills base and the economic support generated through the work in the creative industries in those communities.

It is fair to say—I do not mean this in a party political way—that over the 10 years leading up to 2010, S4C might have been neglected by politicians, in that it was secure in the RPI link to its funding and it avoided a lot of parliamentary scrutiny, which led to it having a false sense of security that money would come, whatever the output, performance and measures we chose to use. Viewing figures were falling, which was a concern, and it simply could not carry on like that. Therefore, when it came to 2010, there was an extremely turbulent time when clearly, we had to look long and hard at all budgets, and S4C obviously could not escape the reality of the financial position. That led to resignations of board members and the sacking of chief executives. It was an extremely turbulent time shortly after the change of Government, from four years ago until today.

It is therefore worth pointing out the stability that has been delivered. The Minister has been constant throughout that period and has played a significant part in delivering the channel’s security. A delegation went to see him and the then Secretary of State for Culture, my right hon. Friend the Member for South West Surrey (Mr Hunt), to underline the importance of the channel to all the issues my hon. Friend the Member for Montgomeryshire discussed—be it culture, language, economic development or celebrating the distinctiveness of Wales as a nation, because it is about not only broadcasting but nationhood and so on. I have no doubt that the Minister and the then Secretary of State absolutely understood that, after considering the matter not only in the budget round but following representations from Members of all political parties as to why S4C could not be treated lightly and had to be given the respect it deserved.

At the time, there were serious questions about the management and editorial independence that the new settlement and the new arrangements with the BBC would provide. Board members of S4C were questioning and criticising that, saying that the future of the channel would be in doubt if the current arrangements were allowed to ensue. I think that has been proven to be wrong. The relationship with the BBC is effective. The BBC provides a large part of its funding but it does—this is extremely important—continue to receive some funding from the Department for Culture, Media and Sport. That needs to be maintained to show that it is not a subsidiary of the BBC. The BBC can raise questions about its performance, just like every other member of the public, and celebrate its great success when it performs as it has in the past and looks as though it will in future, and the way it has turned itself around. I pay tribute to the new chairman, the chief executive and the senior appointments made by them. That has secured the stability of the channel following the turbulent time I have talked about.

I want to continue with the theme of stability. My right hon. Friend the Member for Basingstoke (Maria Miller), again under the guidance of the Minister with us today, protected S4C from the budget cuts that could have resulted from the last comprehensive spending review. Again, that was a significant moment, because unlike almost every other part of Government expenditure, S4C was absolutely protected despite the need to make financial cuts and to address the financial reality. That was important, but we need to admit that at the time there was a tense debate about whether it could be secured. The Minister responded admirably and protected the budget, but I remember several people saying at the time that we should not be in that position in the future and that we needed to develop a system that would secure departmental funding for the channel and secure certainty, to allow it to budget and plan. Although only £7 million comes from the DCMS, that is a significant proportion of S4C’s reduced funding from the BBC. Therefore, it is exceptionally important that we consider that and provide S4C with the opportunity to plan over the short, medium and longer term. Many of the contracts that S4C needs to enter into need to be made now, but will last several years. Without some guarantee or commitment, it is difficult for it to plan in an efficient way that will result in the best use of public money. I hope the Minister can look positively and constructively at that issue. Clearly, there are no guarantees for ever, but the longer any guarantee can last, the better it is for any operator.

I want to make some points about the channel’s future. Comments have been made and questions asked about the viewing figures. They are important, but they are not all of the debate or all of the argument. S4C does need to broaden its appeal, and significant progress has been made in that regard in the last couple of years. Reference has been made to the importance of children’s programmes in the Welsh language, and the part that plays in enabling people to understand Welsh culture at an early age is, without question, vital.

In addition, S4C can be and is a major exporter. It plays a significant role in the creative industries. Mention has already been made of Boom, a company based in my constituency, and other companies that I know very well, such as Tinopolis, Cwmni Da and Rondo. They were based on the initiative that was about making programmes for S4C at the outset. Some of them are now global players in programme making and they deserve the credit for that. The wealth that that generates for the economy is extremely important. The seeds of that were obviously planted by the entrepreneurs, but thanks to the opportunities that S4C created. I am delighted that “Hinterland” is such a great success. That flagship programme is extremely important in demonstrating that programmes of the highest quality can be made and sold and exported all over the world. I hope there can be further Oscar nominations, but of course, that will depend on the quality. That would show those who do not live in Wales or view the channel regularly that, with a relatively small amount of public money, S4C can punch well above its weight through its output and attract further investment thereafter, as many other quality programmes have been able to do so far.

Finally, I want to talk about the multiplier effect. The argument could be made that of course, if we make £80 million or £100 million available to any region or nation of the UK, it can create a business and start exporting. However, for S4C the multiplier effect is without question at the forefront of any form of economic regeneration package. I have talked about the quality of the output and the export income that that can provide. Thanks to the stability that the current Administration have given the channel, for the benefit of all the people of Wales, that income will be greatly extended as S4C continues to develop output that can be exported, and the multiplier effect continues to grow.

10:16

[Hywel Williams (Arfon) (PC)]

It is a pleasure to serve under your chairmanship, Mr Brady. In the past couple of days, Welsh MPs might have thought that all their birthdays and Christmases had come at once. We discussed the Wales Bill yesterday; we have the Welsh Grand Committee today; and the hon. Member for Vale of Glamorgan (Alun Cairns) has the debate following this one. I congratulate my hon. Friend the Member for Montgomeryshire (Glyn Davies)—I think I can call him that—on securing this important debate.

My constituency has some bearing on the debate, because it is the home of many of the small companies that have produced output for S4C and have provided additional services. That has led to great economic progress in my constituency. I sometimes introduce myself as the Member for Arfon, “where the main industries are tourism, agriculture and TV production.” That sometimes raises a few eyebrows, but it is true, because the TV sector in Arfon is extremely important.

I want to take a small step back into the history of S4C—Sianel Pedwar Cymru as I call it. Forgive me, Mr Brady, if I sometimes slip into calling it Sianel Pedwar Cymru, as that is how I see it, rather than S4C. The hon. Member for Vale of Glamorgan referred to the establishment of the channel in the 1980s. Perhaps I can be the first to pay tribute to Sir Wyn Roberts for his titanic struggle to establish it. As a figure who did so much for the Welsh language, he is still underrated, and I am very glad to pay tribute to him today.

My history of the channel starts rather earlier, at a time when I had long hair, a checked shirt, jeans and clogs. [Interruption.] I know that that is difficult to believe, but there we are. Actually, I can see myself, sometime in the early ’70s, at Hyde Park corner, at a rally called by Cymdeithas yr laith Gymraeg, the Welsh Language Society, listening to my hon. Friend the Member for Newport West (Paul Flynn) and being inspired by him. He is as sprightly as ever of course, but he made a speech that Sunday morning and I thought, “Well, if we can get an MP here to talk, there must be something to this.” It rather persuaded me not to pursue my studies in psychology and sociology and instead to pursue a political course, I am afraid, so I have named the guilty man—guilty to a certain extent—here today.

I would like to say a little first about the function of Sianel Pedwar Cymru. As has already been mentioned, it is a provider of programmes, a publisher and an employer, and it also provides a very useful economic stimulus in parts of Wales that in the past have not received the proper amount of attention in the media. As a provider, it is important that S4C produces popular programmes. Reference has been made to children’s programming, and speaking as a new father, my little son is obsessed with “Cyw” and the children’s programmes, as are children throughout Wales. S4C fulfils a hugely valuable function there. Reference has been made to “Y Gwyll”, or “Hinterland”, as it is called in English. Not only is that a very good programme—in Welsh and English—but, as the hon. Member for Vale of Glamorgan mentioned, it shows the world that we are out there with the best. It is an important stiffener to the spine and a bit of an inspiration.

Seeing as I am reminiscing, I remember being in a sociology conference at some point in the mid-’80s. Late at night—after, as they say, drink had been taken—I was discussing minority language broadcasting with people from the university of Hawaii. We eventually came to the conclusion that most TV was trash, but my contention was that if there was any trash going, it should be also available in Welsh. At that point, we decided to retire. That is a significant point, because the Welsh language has been seen over the centuries as the language of the chapel or of high literature, but S4C has an important function in providing popular material that will appeal to a wide audience.

I will not tarry to talk about S4C as an employer. It is an important economic stimulator. I was glad some weeks ago to be present at the opening in my constituency of the building for Cwmni Da, a hugely important production company run by local people who are now not quite so young. For those who judge companies by the way the people there dress, Cwmni Da is not a tie-and-shirt outfit but a jeans-and-sneakers one, and long may that continue. It is a challenging company.

That leads me on to one of my main points, which is a plea for stability of funding for S4C. As has been said, the planning cycle for programmes is long, and producers need to know that the money is there. I do not want to say that we are coming into another difficult period, because things have seemed difficult for rather a long time. I was part of the discussions on the Public Bodies Act 2011, and there was an existential threat to the channel. The money was going to disappear, and I was glad to work with people from across the House to ensure the channel’s future. It operates under an unusual model, and it needs public money. It shares the model of public service broadcaster with Channel 4 and, peculiarly, it has advertisements, even though it is a public service broadcaster. People outside Wales might not know that we have BBC programmes with adverts on either side, which some people find very strange indeed. It is a creative model that actually works, but it needs certainty to continue.

I want to talk briefly about the cultural importance of S4C, which is what we are discussing this morning. The channel is a means of cultural production and cultural reproduction—that is, of passing culture on to other people—and it defines the culture as well as being symbolic of it. We have everything on S4C from cartoons and rock and roll to religion and opera, and even, in the past, Oscar-nominated films. Television has a supremely important function in that respect.

People from England and the other parts of the UK know the reverence with which the BBC is viewed as the repository of all that is good about culture through the medium of English. S4C has something of that function, but it is even more important in Wales. The BBC is only one producer of programmes through the medium of English among hundreds of thousands across the world, but S4C is the only one that does it in Welsh. In that respect, its fragility is both hugely dangerous to the language and a huge opportunity. It literally makes Welshness.

A historian that I am fond of, Gwyn Alf Williams—I am sure that my hon. Friend the Member for Newport West knew of him when he was alive—said tellingly that Welshness is what Welsh people make. It is a function of our will to continue to be Welsh, and it is something that we create anew every day. Whenever we talk about identity, people make appeals to their ancestry. They say, “I have a grandfather who is Irish, a grandmother who is Scottish, and a second cousin through marriage who comes from Poland.” I have Irish ancestry, although that is by the bye. The important thing about S4C is that every day it makes Welshness apparent anew in a creative and radical way.

When I was preparing for the debate, I had a look at the definition of “radical”. S4C is the establishment embodied, because it is Welshness and it has all sorts of programmes including opera, but it is also a radical channel that breaks new ground all the time. The definition in, I think, “Webster’s Dictionary” said that “radical” meant changing and from the root, and was also a term of approbation among skateboarders. That shows how malleable meaning can be. S4C is radical, and long may it remain so, because it is at its best when it is most challenging, radical and creative. The Welsh word for that, to my mind, is “beiddgar”, which means not only challenging, but challenging the very heights when the chances of success are slim—pushing the boundaries. S4C has been beiddgar in such a way. I think it lost its way slightly, but it is going back in that direction.

Reference has been made to the importance of audience, and it is important, but I simply want to say that all channels are now minority channels. Long gone are the days when the Morecambe and Wise Christmas show could pull in 28 million viewers, or half the population of the UK. It is right for critics of S4C from other channels and from the media in general to recall that all channels are minority channels.

I want to finish with one point. S4C has been important in defining and symbolising the Welsh language over many decades, but we must always bear in mind—I wish there was equivalent action on this point—that we need broadcasting about Wales through the medium of English. I remember surprising one of my Labour colleagues some time ago in a debate about the language by saying that English is a Welsh language. That is literally true for 80% of the population in Wales. I finish with an appeal for broadcasting through the medium of English to be better funded, better resourced and better received in Wales.

[Mr Graham Brady (in the Chair)]

Order. I have avoided setting a time limit, but we should start the wind-ups in about 10 minutes’ time. There are two hon. Gentlemen seeking to catch my eye, and I leave it to them to try to make sure that they both get called.

10:29

[Albert Owen (Ynys Môn) (Lab)]

Thank you, Mr Brady, and I will be brief because I want to hear what my hon. Friend the Member for Newport West (Paul Flynn) has to say. I congratulate the hon. Member for Montgomeryshire (Glyn Davies) on securing the debate. Its title is “S4C and Welsh Identity”, and since many hon. Members have talked about the settlement and the past, current and future financing of the channel, I will talk predominantly about the importance of Welsh identity and S4C to me and to many of my constituents and fellow citizens in Wales.

I want to put on the record my praise for the pioneers who set up S4C. The issue is cross-party—the hon. Member for Montgomeryshire mentioned pride in his party, and we hear a lot about Gwynfor Evans and the role of Plaid Cymru—but I want to praise one of my predecessors, Lord Cledwyn Hughes, for the role he played as the Leader of the House of Lords at the time. That body was important in helping to push for the establishment of S4C.

I will just break the consensus with the hon. Member for Montgomeryshire for a moment, because he mentioned this issue. Prior to the early 1980s, Welsh society felt that the Conservative Government of the time had broken their promise and that, as he said, they were prevaricating. A grand coalition of people within the Conservative party and from other parties came together to put pressure on the Government to honour their commitment to the people of Wales. It is important to put that on the record. Nevertheless, the language, culture and identity of the Welsh nation are far too important to belong to any one political party; they belong to the people of Wales, and we have seen that demonstrated today on a cross-party basis.

I was born in Wales to a family whose language in the home was English. My mother was from Liverpool, and I was brought up on the Beatles and Everton football club. I am still proud to support Everton and listen to the music of the Beatles. My father was Welsh speaking, but, in the 1960s, they spoke English in front of me out of courtesy, and I ended up being a non-Welsh speaker throughout my educational life.

[Glyn Davies]

Will the hon. Gentleman give way?

[Albert Owen]

I certainly will, but I am conscious of the time.

[Glyn Davies]

A point that I did not make in my contribution was about what was happening when I was young—I am sure it was also happening in Ynys Môn. My parents were both first-language Welsh speakers, and they had a policy of never speaking Welsh in front of the children, because the language of failure was Welsh and the language of success was English.

[Albert Owen]

It is fair to make that point, as I made one about the language of my home. Indeed, people in the village in which I was brought up and still live used to speak English to me. They are very surprised when they now see me on S4C speaking Welsh, because I have learned the language. I wanted to learn it in order to play a full role in Welsh society: I belong to a bilingual society, so I wanted to be bilingual. I would like Wales to be trilingual, with people learning three, four or more languages. But we must never forget the Welsh language, which S4C has portrayed brilliantly.

We have heard today about S4C’s ability to put on classy productions. The hon. Member for Arfon (Hywel Williams) spoke before me about opera and religion, but I think everyone has missed something out: sport. S4C is very good at showing sport. The Welsh national football team does not always qualify for the World Cup finals—in fact, it has not done so since 1958—but sport is important, because more young people in Wales watch it than many other TV programmes. They aspire to be the Olympian Colin Jackson, or the greatest footballer in the world, Gareth Bale, who also happens to be Welsh, so sport is important.

I watch football on S4C in the Welsh language, but we have the opportunity to use the little red button to listen to the commentary in either Welsh or English. That is hugely important, because it reaches a massive audience of our football and rugby fans—Wales has one of the best rugby teams in the world and people want to watch them. It is important that we break out of the perception that S4C is a minority channel in a minority language covering minority subjects. It is not; it covers sport and culture, as well as many other things that we aspire to do in Wales.

I learned the Welsh language by watching S4C. I listened to programmes and watched the subtitles on 888. Do people remember the old Teletext system? We would have to explain what that was to young people now, but we had subtitles, and we also had the service on 889—I think—which explained sentences when a new word was brought up for the first time. That way, people who were competent and had some knowledge of the Welsh language were able to follow the programme. Language is a live issue and S4C does cover the big issues of the day.

I want to finish my speech by touching on identity, which is important. I gave some brief background but do not have much time to go into other elements of S4C because I want to hear my hon. Friend the Member for Newport West, as I promised. I do not think there is any contradiction between the Welsh and British identities. I am proud to be both Welsh and British—and, indeed, European—and see no contradiction there. British and Welsh society must move forward on that, because a person is not any less Welsh or inhibited from being so by being pro-British; nor is anyone any less British for being pro-Welsh.

The Minister will understand that we are discussing the British isles and a language in Britain that is thriving and moving forward. There are creative people in Wales and they want to express themselves through the medium of their own language. I am also pleased that the Cornish identity and language are taking new steps forward. I want these British isles to express themselves through their mother tongues. People should be proud to be Welsh and proud to be British. I am very proud that S4C has played a part in my life, and in the lives of constituents in Wales whom I represent.

10:35

[Paul Flynn (Newport West) (Lab)]

The Conservatives deserve great credit for their work for the Welsh language—there is no question of that—but the summit of their achievements and the work of Wyn Roberts was in education rather than S4C.

I had a ringside seat at the genesis of S4C. In 1973, with a colleague, I wrote a document called “Television in Wales” that became Labour party policy. The hon. Member for Arfon (Hywel Williams) used the word “fragility”; when one looks at how the campaign for a Welsh channel could have gone wrong in many ways, one sees that it had great luck. The main way that the campaign got the support of almost the entire Welsh population was through a conference in Cardiff called by the lord mayor in 1973. Everyone was saying, “Yes, we want a fourth channel.” The monoglots wanted one not because of their love of the Welsh language but because they wanted an all-English channel. That was a coincidence.

John Davies’s marvellous record of the history of broadcasting contains details about the Broadcasting Council for Wales that I thought would always remain confidential. He records that in 1978 only two voices on the Broadcasting Council for Wales were fourth-channellers. The idea was dead, impractical and was not going to happen. Again, there was a coincidence: Margaret Thatcher happened to be reading about Irish history at the time and saw the audience in Sophia Gardens pavilion in Cardiff chanting “Gwynfor! Gwynfor!” because such a majestic figure in Welsh politics was going to starve himself to death if there was no fourth channel. She read about the effect on Irish nationalism of the deaths—the martyrs—in the Easter rising; about how Irish nationalism multiplied and grew strong. Although the great and the good came up from Wales to change her mind, that was the real reason, and to our great good luck we now have a Welsh language channel.

I think of why we bother to go on. There is a great poem by T. H. Parry-Williams that I recorded from S4C being read beautifully by John Ogwen, about Wales as an untidy part of the world for people who believe in order, a bit of a nuisance, and a tiny place where they speak in a strange way. It is difficult to get across the value of a wonderful, beautiful ancient language. The Hungarian litterateur István Széchenyi asked where he could find the Hungarian nation if he left it. He came up with the phrase, “The nation lives in her language”; not through a language, but in her language, as a place where all the wisdom of a nation—the proverbs, the humour—has come rolling down the centuries and is there enshrined as a living medium. That is the feeling we have for the language.

That lovely poem by T. H. Parry-Williams ends by saying:

“Duw a’m gwaredo, ni allaf ddianc rhag hon”.

We cannot escape from that; it is part of us. It is the great treasure of the language. It is marvellous that none of us who, in 1973, had such an impossible dream that we were told was hopelessly impractical would have believed that a day could come when there was universal approval in this House for the marvellous achievements—beyond our wildest dreams—of S4C.

10:39

[Helen Goodman (Bishop Auckland) (Lab)]

It is a pleasure to see you in the Chair this morning, Mr Brady. I congratulate the hon. Member for Montgomeryshire (Glyn Davies) on securing the debate and introducing it with characteristic charm. He is right that we have a lot of Welsh business this week. I bring apologies from my hon. Friend the Member for Llanelli (Nia Griffith), who is attending the Welsh Grand Committee this morning. Obviously I am not Welsh, but I do remember the introduction of the Broadcasting Act 1981. In my first job when I left university, I worked for a man called Phillip Whitehead, then the MP for Derby North. He was a former television producer and he was on the Broadcasting Bill Committee, so we did a great deal of work to set up both Channel 4 and S4C. One of the people also working on that was a researcher for Plaid Cymru, Aled Eirug, who I am pleased to see is now on the board of S4C. That demonstrates how a not just bipartisan but multipartisan consensus was built, which has been so important for S4C.

The hon. Member for Montgomeryshire is absolutely right to point to the importance—indeed, the centrality—of the Welsh language to Welsh identity. The hon. Member for Arfon (Hywel Williams) said that identity is about more than ancestry. I think he put it very well when he said that S4C is in the business of cultural production and reproduction. That is an extremely important point, because it is no good if the language is unchanging; it must be a living language, central to people’s lives, developing and changing all the time. Given that television is the medium that most people use to get entertainment, news and information, it is essential to continue support for S4C.

The hon. Member for Montgomeryshire also said that—I am borrowing his words—after the election in 2010 there was a funding trauma. It is clear that the changes and the big cut—20%—made by the coalition Government posed significant challenges to S4C. Many hon. Members have spoken about the importance of moving to a more stable situation. My hon. Friend the Member for Clwyd South (Susan Elan Jones) and the hon. Members for Vale of Glamorgan (Alun Cairns) and for Arfon all made that point. Although we do not anticipate a review of the royal charter after the next general election, it is important that we achieve greater stability so that S4C can make intelligent plans for its programme production. It works on a two to three-year time scale and will not be able to maintain the high standard of programming that has been developed without funding certainty, so whatever structure is chosen, we must be able to be confident that it can be sustained in the medium term.

Hon. Members have pointed out the many good and enjoyable programmes being made by the indie sector for S4C, from sport and religion to drama. Selling noir drama back to the Scandinavians is a triumph. It is clear that these high-quality programmes are strongly appreciated in Wales: 92% of people think that S4C is the best channel for Wales, and 97% say that S4C keeps the language alive. Everybody very much hopes that we can establish a system to maintain that excellent track record.

10:45

[The Parliamentary Under-Secretary of State for Culture, Media and Sport (Mr Edward Vaizey)]

I am pleased to serve under your chairmanship, Mr Brady. I congratulate my hon. Friend the Member for Montgomeryshire (Glyn Davies) on securing this important debate. I immensely enjoyed his lyrical contribution, as well as the outstanding contributions from other Members this morning, including my hon. Friend the Member for Vale of Glamorgan (Alun Cairns) and the hon. Members for Clwyd South (Susan Elan Jones), for Arfon (Hywel Williams), for Ynys Môn (Albert Owen), for Newport West (Paul Flynn), and, of course, for Bishop Auckland (Helen Goodman).

My hon. Friend the Member for Montgomeryshire started by saying that as he got older, he had a yearning to be bilingual. Perhaps it is a sign of my now rampant middle age that I always enjoy a bit of bipartisanship, and I always think we have the best debates in this House when, broadly speaking, there is a great deal of common ground in the landscape. I too pay tribute to Lord Roberts, about whom many of the contributors spoke so eloquently this morning.

[Glyn Davies]

I rise to add my voice to the appreciation for the work of Lord Roberts. I omitted to do so during my speech. One of the dangers in not preparing notes for a speech is that we sometimes forget one of the most important things that we wanted to say.

[Mr Vaizey]

I am pleased to have given way to my hon. Friend to allow him to make that tribute, although I feel people would have understood that his entire paean to S4C was a tribute to Lord Roberts.

[Albert Owen]

I join in the tributes to Lord Roberts, who lived in the constituency that I represent and was brought up there. He was a pioneer of broadcasting, not only in the Welsh language but in English as well. As for bipartisanship, I was always told that a cigarette paper could not be put between Gwynfor Evans, Wyn Roberts, Cledwyn Hughes and Geraint Howells. It was impossible to do it, because all came from the same mould: the Welsh mould.

[Mr Vaizey]

Hear, hear to that. May I add my tribute to all the Welsh titans mentioned by the hon. Member for Ynys Môn? Of course, Lord Roberts was the predecessor of my hon. Friend the Member for Aberconwy (Guto Bebb), who is widely acknowledged as a great mover in this debate.

Before I move on to the meat of my speech—the debate is becoming an extended tribute session—I should also pay tribute to Dylan Thomas. This year is the 100th anniversary of the birth of one of Wales’s most celebrated sons, so it is appropriate, as we debate the importance of the Welsh language, the Welsh language broadcaster and Welsh culture in general, to acknowledge that very important anniversary, which is being commemorated in Wales, and, indeed, around the world.

The main subject of the debate is S4C, which is a long-standing and significant part of the UK’s rich public service broadcasting landscape and a stalwart of Welsh language services. Only last year, we gathered in this Chamber to celebrate the 30th anniversary of S4C. I said earlier that it was a privilege to hear the speeches made this morning, but such debates are always a pleasure, because of the deep understanding shown by the Members participating. They have clearly been involved for many years in S4C and the campaigns and debates about the Welsh language. Some have served in the House for many years, but those who have come to the House recently have been involved in the issue for many years. There can be no doubt that for me and my successors, from whichever party they come, the channel and its content make a tremendously important contribution to the cultural life of Wales, as well as economic impacts, and those deserve to be celebrated.

Dylan Thomas, grew up when an English-only education system was the norm in Wales—hon. Members have mentioned that the same was true when they were growing up—and the mother tongue was pushed to the margins. Thankfully, as acknowledged in many speeches, times have changed. The number of children in Welsh-medium primary schools has seen a steady increase over recent years, but we must not be complacent. We must be mindful of the importance of preserving the Welsh language and the important role played by S4C. Indeed, my hon. Friend the Member for Montgomeryshire has said previously in the House that, although not brought up a Welsh-speaker, the existence of S4C was critical to his learning and mastering the language.

The media, particularly the broadcast media, are vital to language and to the preservation of culture. Culture and identity are bound up in shared experiences, and TV clearly has an important role to play, whether in sport—we all know how central the game of rugby is to Welsh culture—drama, such as “Pobol y Cwm”, or key cultural events such as the Eisteddfod and the royal Welsh show. It is no coincidence that all those examples are broadcast to the Welsh-speaking public and the Welsh public in general by S4C.

To return to my earlier theme, I pay tribute, as did my hon. Friend the Member for Vale of Glamorgan, to the chief executive of S4C, Ian Jones, and the chairman of the S4C authority, Huw Jones, for their outstanding work in ensuring that S4C has in difficult times not only kept on an even keel, but thrived.

The hon. Member for Clwyd South demonstrated her legendary recall of detail by remembering that in 2010 I was keen to share my experience of “Fireman Sam”, but S4C is obviously much more than “Fireman Sam”. As my hon. Friend the Member for Montgomeryshire and others pointed out, S4C is currently enjoying national prominence with the murder drama, “Hinterland”, which shows Welsh television and TV in general at their best. The mean and moody DCI Mathias and the equally mean and moody landscapes around Ceredigion have given us the latest water-cooler TV. The programme was shown on S4C last year entirely in Welsh, migrated to BBC 1 Wales in a bilingual version and is now showing on BBC 4. It has also been sold to Denmark, among other countries, which is perhaps an example of coals to Newcastle and which shows that anything they can do, the Welsh can do—in the spirit of bipartisanship, I should perhaps say “equally as well”. Hopefully, if hon. Members will pardon the pun, the Welsh can make a “Killing” with Welsh drama. Better still, I understand that the show has now been picked up by Netflix and that more episodes have been commissioned. “Hinterland” is not S4C’s only contribution to the genre, either. “35 Days”, which has only recently hit screens in Wales, is another example of great murder drama and is entirely in Welsh.

[Guto Bebb]

I am grateful to the Minister for giving way. A key development in the partnership between S4C and the BBC will be the availability of S4C programmes on iPlayer, with my daughters, for example, looking forward to downloading “35 Days”. This innovation will bring S4C to an audience who are no longer willing to sit down at a certain time to watch a television programme.

[Mr Vaizey]

That is an extremely important point, which takes me back to the debate, beginning in 2010, about the future of S4C, because S4C’s current success has taken place against the background of significant challenges, but those challenges have also brought opportunities. S4C was not alone in facing challenges.

[Chris Ruane (Vale of Clwyd) (Lab)]

By “challenges”, does the Minister mean cuts?

[Mr Vaizey]

It is always good to have someone come late to the debate and destroy the good will and general bonhomie that we were hitherto enjoying. I mean challenges. I am always one for a euphemism, but I mean the challenges that have been faced by many fine institutions. I was pleased that the Government were able to protect Department for Culture, Media and Sport funding for S4C during the last autumn statement and to ensure no cuts. It is not possible to offer certainty around Exchequer funding beyond 2015-16—in case anybody wants to try to read between the lines of that statement, that is the case for all publicly funded bodies—but given that the majority of S4C’s funding now comes from the licence fee, it is important that it is guaranteed up to 2017. The Government have as yet made no statement on how they intend to proceed on charter review. Sadly, I may not be the Minister supervising charter review, but common sense would clearly dictate, given the stellar speeches and high quality of the hon. Members who have contributed to the debate and given the level of debate that accompanied the changes to S4C in 2010, that S4C and other language channels will be a prominent part in such a review.

Today, we have focused on the culture as well as the cash, but it is important to understand the contribution made by S4C to the creative economy in Wales, as mentioned by the hon. Member for Arfon. Thousands of Welsh jobs are supported by S4C-related activity, and research published by S4C last year showed that each pound of funding returned nearly twice that amount for the Welsh economy, which is perhaps unsurprising but nevertheless important to acknowledge. It is also encouraging to see that formats developed in Wales, and in Welsh, are selling internationally. We have mentioned “Hinterland”, but there is also the recent sale of “Fferm Factor” to China, taking farming to a country with 300 million farmers.

As we look to the future, a key challenge for all traditional broadcasters will be to continue to reach their audiences. That challenge is more acute for public service broadcasters, and particularly for S4C, which faces the challenge of reaching an increasingly fragmented audience with such a wealth of content, and means of accessing content, on the market. In a world where the internet is largely in English, that is no small challenge, which is why the point made by my hon. Friend the Member for Aberconwy (Guto Bebb) is so telling. The partnership with the BBC not only saves money in overheads and encourages a shared approach to programming and news, but gives S4C the opportunity to showcase its excellent content on BBC iPlayer.

I am delighted that S4C is reaching out and continues to strive to meet children’s needs with two dedicated channels, Cyw, broadcasting to pre-schoolers on TV and online, and Stwnsh, aimed at slightly older children and young people. Although age need not be a barrier to learning a new language, as shown by my hon. Friend the Member for Montgomeryshire, it is important to reach people and potential Welsh speakers when they are young. I hope that S4C will continue to push forward plans to reach young people in a multi-channel, multi-device world. It is also important to reach the 16 to 24-year-old audience. Among Welsh speakers in that age group, only half consider themselves fluent, so it important that such content continues to be pushed through, which is why S4C programmes being on iPlayer and S4C’s own online offering, Clic, are so important. It is entirely in line with the Government’s objective that public service content should be available to as many people as possible, and maintaining a presence on such platforms will be increasingly central to that objective as viewing habits change.

Finally, I thank all hon. and right hon. Members who have contributed today. There may have been some disagreement or concern about the changes made to S4C’s funding structure a few years ago, but no one in the Government and no one in the House with an interest in such matters would deny S4C’s importance to the Welsh language, to Welsh identity, to culture more broadly and to the Welsh economy. I salute S4C on its success and wish it great success in the future.

Financial Services Authority and Connaught Income Fund

Wednesday 7th May 2014 Westminster Hall

11:00

[Alun Cairns (Vale of Glamorgan) (Con)]

It is a pleasure to serve under your chairmanship for the second time today, Mr Brady. I welcome the Minister to her role, and welcome her involvement in this important issue.

As you can see, Mr Brady, this debate has drawn much attention from colleagues and investors alike. Naturally, investors want explanations of what went wrong and why. Colleagues who have looked into the case recognise the scale of the wrongdoing, and want to know how it happened and about any recourse available to their constituents.

This issue has developed over some time, but this is the first time we have had the opportunity to raise concerns about it and ask questions on the record. The Connaught Income Fund was launched in April 2008. It was promoted and operated by Capita Financial Managers Ltd, which was also the custodian of investors’ assets. Its original name was the Guaranteed Low Risk Income Fund, series 1—something that proved not to be the case. It was a UK-based unregulated collective investment scheme. By definition, these funds are not subject to direct regulation. However, elements of the process and funds were regulated, which means that the regulatory framework and responsibilities are not necessarily straightforward—in fact, they are complex—and that there is a responsibility on the Financial Services Authority.

[Guy Opperman (Hexham) (Con)]

I congratulate my hon. Friend on securing this important debate. Both he and I have fought Capita for more than three years following the Arch Cru disaster, which entailed similar losses, and several constituents of mine lost money through Connaught. Does he agree that it is appropriate to invite the Minister to seek the police’s involvement and to find out whether an investigation should take place?

[Alun Cairns]

I pay tribute to my hon. Friend’s work on Arch Cru as secretary of the all-party group on the Arch Cru investment scheme, and on his involvement in issues relating to Capita. He raises pertinent points that I will come on to, so I am grateful for his contribution.

[Albert Owen (Ynys Môn) (Lab)]

I am grateful to the hon. Gentleman for giving way to me so early. I have to leave, having been in the previous debate with him for an hour and a half.

Is the hon. Gentleman as concerned as I am that so little information is available on Capita, and particularly on the signing-off of the information memorandum? That is a matter of great concern to a number of my constituents and, I am sure, to constituents of hon. Members of all parties.

[Alun Cairns]

I am grateful to the hon. Gentleman for raising important points about Capita that I will come on to. A central factor is what knowledge it had at various stages.

[Chris Ruane (Vale of Clwyd) (Lab)]

I congratulate the hon. Gentleman on securing this debate. Is this the same Capita that won the personal independence payments contract with the Government, for Wales and the west of England?

[Alun Cairns]

I am grateful to the hon. Gentleman for his contribution, but of course Capita Financial Managers Ltd is different from other subsidiaries of Capita. The parent company will be the same; there are several subsidiaries. The point was well made, and I accept it in the way that it was intended.

I should like to pursue the matter a bit further before accepting any other interventions, to provide some background. The proposition was that investors’ money would be loaned to borrowers requiring short-term residential bridging loans. Loans would not exceed modest loan-to-value guidelines, no sub-prime lenders or properties would be financed, and all loans would be secured by first charges against those properties. Specifically, there was to be an average loan-to-value rate of 56%. People were told that it would seldom be above 70% and that anything above 80% would have guaranteed exits. All interest and fees would be taken up front, and there was a guarantee from Tiuta, a company that I will mention shortly, to meet any shortfalls.

The borrowers would pay an interest rate of 17.9%, while investors would receive quarterly distributions of between 8.15% to 8.5%. Capita appointed Tiuta plc and Connaught Asset Management Ltd, both UK companies, to identify suitable borrowers and approve the loans. However, investors’ funds were used differently. Money was transferred to Tiuta, rather than being released directly to the borrowers’ solicitors. It is even suggested that there was no differentiation between the firm’s funds and those of the investors; investors’ money was used to meet the working capital needs of Tiuta, and to pay directors’ salaries, bonuses and pension contributions.

In many cases, where bridging loans were made, the borrowers, properties or loan-to-value ratios were not as committed to in the promotional literature. It is believed that Tiuta proposed loans and drew down the money, but did not proceed with the lending. It is suggested that Connaught provided a monthly statement to Tiuta’s management accountant, switching the true loan book and the approved one.

In March 2009, Capita became aware that the original information memorandum was misleading. The fund should not have been described as low-risk, the guarantee from Tiuta was of no value, the money was used largely for purposes other than bridging loans, and the auditors of the fund were not engaged. In addition, the loans that had been made were not as described and were being rolled over.

In August 2009, after Capita met Connaught’s senior management, investors were informed by Capita that it was resigning as operator of the fund. It was to be replaced by Mourant Fund Services Ltd, but for some unknown reason Mourant did not complete the transaction. Perhaps it became aware of the problems with the fund.

[Guto Bebb (Aberconwy) (Con)]

I congratulate my hon. Friend on securing this debate. Is it not a significant concern for all of us who have been looking at this issue that, in 2009, it became apparent that Capita had significant concerns about the way that the fund was being operated, but those concerns were not conveyed to those who had invested in the fund?

[Alun Cairns]

I pay tribute to my hon. Friend for his support in investigating this matter. He raises an important point. There is a serious question about what Capita did and did not know, and what it should have communicated to the investors, to whom it had a responsibility.

[Bill Wiggin (North Herefordshire) (Con)]

I draw the House’s attention to my entry in the Register of Members’ Financial Interests. My constituent, Mr Sudworth, who is a victim of this fraud, asked me a question; I wonder whether my hon. Friend knows the answer. Does the Financial Conduct Authority outsource some of its work to Capita?

[Alun Cairns]

I am grateful for my hon. Friend’s question. I do not have the answer, but he points to a general defensive approach that has been taken by the FSA and the FCA. We are seeking greater transparency to get the answer to many such questions, so that we can identify where the responsibility lies.

Perhaps Mourant became aware of some of the issues that have now become apparent. Instead, Capita passed responsibility on to Blue Gate Capital Ltd, which agreed to the appointment in September 2009.

George Patellis was appointed chief executive of Tiuta in April 2010. He became concerned about the quality of the financial reporting at the company. In January 2011, a shortfall of at least £20 million was identified, suggesting insolvency. He also became aware that Tiuta had retained the proceeds when some loans had been redeemed, and of Land Registry DS1 inconsistencies.

Mr Patellis appointed BDO to investigate in January 2011, and it confirmed his initial concerns. He then resigned and alerted the FSA to the situation, to report financial irregularities at Tiuta. As a result, a case was opened by the FSA and supervisory engagement with Tiuta began. The FSA required Tiuta to engage investigative accountants to monitor its financial performance. That may relate to what my hon. Friend the Member for North Herefordshire (Bill Wiggin) mentioned. Tiuta was responsible for reporting to the FSA monthly. However, instead of undertaking independent investigations, BDO, which had secured the role, relied on information supplied by directors of Tiuta, which then produced a series of reports that persuaded the FSA that the firm should be allowed to continue to trade.

In May 2011, the FSA issued a consumer alert because marketing materials indicated that the fund was low risk, and that returns were guaranteed. The marketing material was amended for independent financial advisers, and Blue Gate was made aware of the issues with the security of the loans. In March 2012, Blue Gate notified the 1,200 investors that the fund had been suspended due to an inability to pay quarterly interest payments to investors. Tiuta was placed in administration in September 2012.

It is suggested that investors face losses of at least 70% of the £106 million that was invested. In addition, investors have to date lost up to £20 million in unpaid quarterly distributions. Since then, a number of MPs have written to the FSA—and now the Financial Conduct Authority—and the Treasury to establish whether there is a regulatory responsibility to investigate the fund, and whether there is any potential for compensating investors.

Having considered the background, I will make a number of points and ask a few questions of the Minister. Although I recognise that the Connaught fund was an unregulated investment scheme, various elements were regulated, as I mentioned at the outset. The advice process was regulated. I am not suggesting for a minute that advisers were responsible for the failings and misappropriation of funds. There is a need, however, to clarify where their responsibility ends.

In fairness to IFAs, they depend on the key financial documents, which were not accurate or adhered to, yet questions should be asked about why unregulated funds were recommended to investors in the first instance. The time for advice on such funds is clearly very limited. What did Capita know in August 2009 when it sought to pass on its responsibilities? What action did Capita take to ensure proper management of the fund at earlier stages? If Capita had doubts or questions, why was that not communicated to investors? Was Capita’s letter to investors misleading, or did Capita withhold information indicating there was unsecured and unauthorised lending from the fund?

[Guy Opperman]

Is it not incumbent on the Minister to clarify the legal position of investors on that specific point? If investors are to sue for their loss, they need to know the date of the knowledge of the fund’s decline. Secondly, they need to know the state of the assets at that time and the extent to which the FCA will assist in the recovery.

[Alun Cairns]

There could clearly be a statute of limitations that affects investors, on which I hope the Minister can offer advice.

There was obviously a gap between Capita’s original letter of 20 August 2009 advising investors of its intention to pass responsibility to Mourant and the letter of 24 September advising that Blue Gate would become responsible. Should Capita have suspended the fund when it realised that it was not being managed in accordance with the financial information documents?

As we have discussed, this is not the first time that Capita has needed to answer questions about its role. As the authorised corporate director of Arch Cru, Capita was forced to compensate investors to the tune of £32 million. Terms, how that sum was reached and Capita’s responsibilities and failings have still not been disclosed, but a sum of that size suggests some form of culpability.

Questions should be asked about the actions taken by the FSA, and now the FCA. Some investors believe that the FSA and FCA have taken little action, but the Minister’s predecessor, my right hon. Friend the Member for Bromsgrove (Sajid Javid), advised me in general terms of some of the work they undertook. That needs to be published to reassure people and to allow further questions to be raised about what could have happened.

[Chris Ruane]

Does the hon. Gentleman believe that the FSA has let down Connaught investors? Is he aware of the case of Burges Salmon, which was a similar scam of which the FCA has washed its hands and for which it has taken no responsibility? Does he think that the FCA needs to be looked at?

[Alun Cairns]

I am not familiar with that case, but greater transparency on the FCA, into which the FSA has now evolved, would be helpful and may dispel the criticisms. We simply do not know the specific actions that it took, if indeed it took any at any point. I hope that there has been more than evolution; there needs to be a different culture at the FCA to ensure that the failings of the past are not repeated.

What about the FSA’s actions following the intervention of George Patellis? The Financial Services and Markets Act 2000 gave the FSA a statutory duty to maintain market confidence, ensure public awareness, reduce financial crime and protect consumers. We can also ask questions of the police. Surely there are sufficient grounds for the police to investigate the matter, given the misappropriation of funds.

Finally, is the Minister able to advise us of any statute of limitations that falls on investors? That is the point raised by my hon. Friend the Member for Hexham (Guy Opperman). Ultimately, is any recourse available? In closing, I underline that although the saga has gone on for an awfully long time for investors, this is our first opportunity to discuss it in Parliament. I would like to think that this is the start of parliamentary scrutiny, and certainly not the end of the matter. I look forward to the Minister’s response.

11:10

[The Economic Secretary to the Treasury (Andrea Leadsom)]

It is a great pleasure to serve under your chairmanship for my second outing in Westminster Hall, Mr Brady. I congratulate my hon. Friend the Member for Vale of Glamorgan (Alun Cairns) on organising this debate on an incredibly important subject. I also have constituents who have lost a huge amount of money as a result of the devastating investment they made. It is important that we get to the bottom of the matter and try to ensure that, if possible, investors can be compensated in some way. Those who are responsible should face the maximum justice available.

This is an important issue not just for my hon. Friend’s constituents and mine. I see many Members in Westminster Hall today whose constituents have also suffered as a result of investing in the fund, so it is important that the FSA, as was, and now the FCA take the matter extremely seriously. I reassure him and all other Members here today that that is indeed the case.

Many investors have lost their life savings as a result of the events involving the Connaught funds, which has caused real hardship for people across the country. As my hon. Friend made clear, the Connaught funds comprise three separate funds: the Connaught Income Fund series 1, series 2 and series 3. In total, approximately £145 million was invested in the funds, which, as we know, were unregulated collective investment schemes. By definition, such schemes are not subject to direct regulation by the FCA or, previously, the FSA.

[Guto Bebb]

I visited the FCA with my hon. Friend the Member for Vale of Glamorgan (Alun Cairns) to look at the issue in question. We were shown a flowchart identifying the selling process for this investment. The number of elements that were regulated and the number not regulated implied that there was significant confusion about the way the regulatory process actually works in the UK.

[Andrea Leadsom]

My hon. Friend makes an extremely relevant point. As I was looking into the matter in some detail yesterday, I was struck by exactly the same thing. There were regulated elements and unregulated elements, and of course we have ended up with a disastrous scenario in which people have lost a lot of money and it has become difficult to get to the bottom of everything. I will try to unravel that a bit.

As I said, because of the unregulated nature of some of the entities involved, many of the usual protections and safeguards that protect investors in regulated funds were absent. That is why the promotion and distribution of such schemes are subject to strict controls. Unfortunately, it seems that in this instance even those controls did not prevent a large number of individuals from investing in the fund. In addition to the questions that have been raised, to which I will return in a moment, I would like to address two main issues: first, the actions taken by the FCA to try to protect consumers, despite most of the entities involved being unregulated; and secondly, the ongoing work for the benefit of consumers and investors to secure a fair and proper outcome.

First, despite the schemes being unregulated, the FCA has taken a number of steps to try to protect consumers. In May 2011, the FSA altered Tiuta’s permission so that it could no longer carry out any new regulated mortgage lending and issued an alert to consumers telling them what they should do if they thought they had been mis-sold the fund. In June 2011, the FSA wrote to all financial advisers who sold the fund, asking them to review the sales and to contact consumers where there might be risk of unsuitable advice. It also set up a page on its website for consumers and firms to receive information on the fund. In August 2011, it required Tiuta to instruct Connaught Asset Management Ltd to change its marketing materials so that they no longer described the fund as “low risk” and “guaranteed”. The FSA took the view that those descriptions were misleading. Finally, in June 2012, it altered Tiuta’s permission to ensure funds from redeemed loans returned to the series 1 fund.

[Chris Ruane]

In August 2012, Capita, the parent body of the Connaught fund, was given a contract by the Department for Work and Pensions worth hundreds of millions of pounds. Who should pay for the losses? Should it be Capita, or should it be the 1,200 individuals who were falsely sold the investment? Will the Minister use her position with the Secretary of State for Work and Pensions to ensure that Capita does the right thing and compensates those individuals?

[Andrea Leadsom]

I am grateful to the hon. Gentleman for making that point, which I will certainly look into further. Those two organisations belong to the same parent company, but are in fact different subsidiaries. As he might be aware, Government contracts are awarded in line with EU procurement rules.

In addition to the work by the FCA, I can also confirm that other law enforcement agencies are looking into this matter. I will urge the police to consider the case very carefully. I know that Members are interested to hear whether the police are looking at this matter, and I can confirm that they are. The FCA has been working closely with law enforcement agencies to identify and pursue avenues that will yield the best outcome for investors. It continues to look into the matter, and its work is very much ongoing. In the meantime, it is encouraging any investors who believe they might have been mis-sold a product to contact their independent financial adviser. It has disclosed information to the police and the administrators of the firms involved to help them with their inquiries.

A number of points were made during the debate, and I will try to address them. I was asked whether Capita Financial Managers Ltd was negligent in its operation of the fund and whether it breached its obligations under the Financial Services and Markets Act 2000, the operator agreement or its duty of care to consumers. The Government and the FCA take those allegations very seriously, and the FCA is carrying out its own inquiries, but the requirements on the operator of an unregulated fund are limited under FCA rules. I was asked whether the FCA has made a restitution order against Capita. I stress that the FCA is considering all the different avenues by which those who have suffered could obtain compensation. I was asked about the information provided by George Patellis.

[Mr David Davis (Haltemprice and Howden) (Con)]

In a number of these cases, some involving Capita and some involving others, it has been clear that the financial structure of the company has been set up with limited liability subsidiaries to prevent the compensation demands from going back to the parent. Will she ask the FCA to look at the acceptability of that approach, with a view to future concerns like these? It seems to me that it is a way for the company to get the benefit from a reputation, without meeting the liability that goes with it.

[Andrea Leadsom]

I completely agree. There are questions to be asked about how this apparent ability to avoid culpability has been allowed, whether steps can be taken to ensure it cannot happen again and whether there are compensation issues. The FCA is looking into all those matters, but I will take up the point my right hon. Friend makes.

I was just talking about the action the FSA took when it received information from George Patellis. The FSA met with other parties to discuss his concerns, and as a result of those discussions, it became seriously concerned about the financial position of Tiuta plc. Having considered the regulatory options in respect of Tiuta plc, in May 2011 a requirement was added to the permission of the firm that it should cease any further regulated mortgage lending. In the same month, the FSA issued the consumer alert on the fund. A further alert was issued to financial advisers asking them to consider the suitability of advice they had given to consumers who had invested in the fund and to take action accordingly. In light of the fact that very little of Tiuta’s business was regulated, the FSA considered those steps to be appropriate and proportionate at the time. I certainly take on board the point made by my right hon. Friend the Member for Haltemprice and Howden (Mr Davis) about whether that was, with hindsight, acceptable.

On the other questions I was asked, Capita issued an information memorandum that consumers believe to be fraudulent, as the fund did not operate as it said it would. I was asked what action the FCA is taking against Capita. As I said, the FCA is considering all avenues by which investors might be compensated. Unfortunately, I cannot comment on that further at this time. One point I make, because the question has been implied, is that IFAs are not supposed to sell unregulated investment schemes to retail investors. The circumstances in which unregulated schemes can be promoted to consumers are generally restricted to certain types of consumers, such as sophisticated investors and high net worth individuals, for whom the products are likely to be suitable. The FCA has brought in new rules, banning the promotion of unregulated collective investment schemes to ordinary retail consumers. IFAs have the responsibility to promote the fund only to eligible individuals. That is an important point.

My hon. Friend the Member for Hexham (Guy Opperman) asked whether the police are involved. I confirm that they are. A question was asked about the deadlines for issuing complaints. The fund was incepted in June and July 2008 and suspended in March 2012. Action can be taken either six years from the cause of action, which will start to expire from June 2014—all those investors who invested in the early days of the fund need to take careful advice if they wish to make a complaint about that product, because the deadline is fast approaching—or three years from the date of knowledge of the cause of action, which is likely to expire in March 2015 or, at the latest, September 2015. I urge those consumers who feel that they were mis-sold the fund to look carefully at these deadlines. If the case goes to court, it depends on those courses of action. Insolvency reviews of those companies will be reporting in the near future. We do not have a more specific date for that.

Once again, I would like to thank sincerely my hon. Friend the Member for Vale of Glamorgan for instigating this debate on this important case, which is upsetting for many investors. I hope I have reassured him that the Government are fully aware of his concerns and that we take this issue seriously. We are absolutely determined that our financial services sector serves consumers in a right and fair way, and that investors receive the protections they need.

11:28

Sitting suspended.

Electoral Conduct (Discrimination)

Wednesday 7th May 2014 Westminster Hall

[Mrs Anne Main in the Chair]

14:30

[Natascha Engel (North East Derbyshire) (Lab)]

I am delighted to have secured this debate and to serve under your chairmanship, Mrs Main. The debate follows an all-party parliamentary inquiry into electoral conduct, which reported only a couple of months ago, and the inquiry itself came about following another inquiry by the all-party parliamentary group against anti-Semitism, which found that anti-Semitism and all other forms of discrimination were still quite alive and well during UK elections. We set up the all-party parliamentary inquiry, which includes not only all parties across this House, but also some Members from the other place, to investigate whether there actually was a problem. When we found that there was, we tried to consider some constructive ways of addressing the issues to ensure that elections in this country are as free and fair as possible and that there is a level playing field for all people who want to put their names forward as candidates.

On the whole, elections in the UK have always been free, just and fair. We live in a mature democracy that values fairness and understands the importance of democracy and elections. Tensions do exist in some areas, however, and they vary between areas and over time. We know exactly where they are and they may be few, but they are a serious problem. The tensions can be ethnic, religious, sectarian or based on gender or sexuality and exist in small pockets around the country, where things can flare up during local council or general elections or by-elections.

[Mr David Lammy (Tottenham) (Lab)]

I am grateful to my hon. Friend for giving way. On that point, does she recognise the debate’s importance given an incident just last week in which a candidate in a local election made seriously offensive remarks about Islam and subsequently stood down?

[Natascha Engel]

Absolutely. As we move towards a general election in precisely a year’s time, we increasingly have to deal with offensive comments. From the outset, the inquiry made it clear that we prize above all else freedom of speech and people’s ability to say even offensive things, but also that we wanted to identify the line between speaking freely and being not just offensive but discriminatory.

[Mr David Burrowes (Enfield, Southgate) (Con)]

I congratulate the hon. Lady on her fine chairmanship of the inquiry, on which I was proud to serve. On local elections, there is so much more to do. A candidate in Enfield made appalling racist comments, for example. He resigned, but things nevertheless got to that stage and appropriate action was taken. The strongest words in the report focused on the Equality and Human Rights Commission for dereliction of duty in preventing discrimination during election campaigns. What does the hon. Lady have to say about more needing to be done, particularly by the EHRC?

[Mrs Anne Main (in the Chair)]

Order. I ask that interventions be brief. If hon. Members want to speak, there are opportunities, so they can rise if they want.

[Natascha Engel]

If the hon. Gentleman will allow me, I will come on to discuss the role of the Equality and Human Rights Commission, which, as he said, featured greatly in the inquiry’s deliberations when writing the report. We are, however, keeping an eye on local elections.

[John Mann (Bassetlaw) (Lab)]

Before my hon. Friend moves on to the Equality and Human Rights Commission, does she agree that political parties have a fundamental role to play and that, following the inquiry’s brilliant work, they should all sign up to what this cross-party group of MPs has wisely recommended?

[Natascha Engel]

Absolutely. At top and bottom of our recommendations was the role of political parties. In fact, my hon. Friend and I have been busy speaking to people within political parties to ensure that they sign up not only in principle but in practice to some kind of code of conduct that allows individuals, be they candidates, members of the public or political party workers, to know where to go when there is not just a complaint, but a serious concern. Even though we have some recommendations for different agencies, it is the political parties that really need to work together. Having said that, we had good representations from all political parties, especially the smaller parties that compete against the large, mainstream political machines. They really co-operated with the inquiry and were looking forward to being given help to do better, so we were impressed by them.

I am delighted to see the hon. Member for Ilford North (Mr Scott) present. One thing that came out strongly from the inquiry was that some of the examples that we heard, some of which we could not publish in our report, were very extreme. Even though they are few and far between, I was shocked by some of the things that happen. I wish that they did not, and hope that we can work towards making them less likely to happen. Although we would like to wipe the problem out, it will always occur, so we need to ensure that people are less likely to behave in a discriminatory way in order to gain an electoral advantage. Our inquiry found that people in some areas were not putting their names forward as candidates out of fear for their lives, which happened across the board. Whether the tensions were religious, ethnic or based on their sexuality or gender, we found that people who would have been good candidates for elected office at any level were not putting their names forward. Everyone on the inquiry felt that that was unacceptable. We were impressed by the hon. Member for Ilford North and the former Member for Gloucester, Parmjit Dhanda, and understood how brave it was for them to give oral evidence in public, for which we were grateful.

A problem that we highlight in the report and would like a wider discussion about is that the offence, which can be intimidating and secretive in nature, is difficult to combat. A racist sitting in their garage printing vile leaflets will not put their name and address in an imprint on the bottom to enable the police to knock on their door and say, “This is unacceptable.” By its nature, the offence can be difficult to trace. The often tight-knit communities where smearing propaganda is being put out are closed by their nature and it can be difficult to get hold of the evidence in order to prove anything. That does not mean, however, that we should not try, or should not try to ensure that people are educated properly to make it less likely that this vile rubbish goes out in the first place.

In our report, we quoted at great length the 11—we thought that there were 10—self-evident and basic principles outlined by Lord Lester in his pamphlet from the 1990s, “Political Speech and Race Relations in a Liberal Democracy”. They are basic principles, but excellent ones. I will not read all of them, but an important one is:

“The right to free and unfettered political speech and debate is fundamental to democracy.”

We tried to achieve balance in our report, because where does robust political campaigning end and discrimination begin? On the one hand, we were all clear that we knew where the line was. On the other hand, we did not want an environment in which no one can come out and say things, even if they are sometimes offensive. Let people be judged at the ballot box; if they make rude, hurtful or nasty remarks, they tend to stand down because of public pressure or pressure from within their political party—that is the best pressure—or they are voted down in elections.

I, for one, was therefore delighted to see the end of the British National party, pretty much, at the last election. That demonstrates my point: once BNP members got elected to office, people saw how they behaved, did not like it and voted them out. That is how things should be. What we are trying to tackle is behaviour on the extremes that is not only unacceptable but intimidating and threatening, putting people in fear and stopping them putting their names forward as candidates.

I will go through some of our recommendations. In our call for evidence, we received some 50 responses from different organisations, including not only political parties but the election agencies—there was also a lot of interest from international election agencies—the police, who were very engaged with the inquiry; a lot of academics; trade unions; local councils, which gave some excellent evidence; and non-governmental organisations and Government agencies. We held two oral evidence sessions, which were well attended and very interesting, and some surprising things came out of them. I thank all those who put in written evidence and who took the time to come along to our sessions. Our inquiry was very rich in evidence and, as a result, we could produce a strong report at the end of it.

The report focused on a number of policy concerns, primarily policing and the law. The police who attended were engaged with electoral conduct—they have special units to deal with it—but the people who really impressed us were former members of the Commission for Racial Equality. They gave some excellent evidence on past best practice that had worked well and was being developed. It involved going out into communities that had already been identified, working with them and their leaders and the local councils, keeping information and developing databases, and focusing on the positive educational side. One of our recommendations to the Equality and Human Rights Commission is to look at the toolkit that the CRE had produced, dust it down, update it and see whether we can use it in the run-up to the next general election.

[Mr Lammy]

Reflecting on where the EHRC finds itself, does my hon. Friend share the view of many members of the committee? We could not quite understand why there has been that stepping back from good activity by the leadership of the EHRC. Should that not be what an Equality and Human Rights Commission is for in a democracy?

[Natascha Engel]

Absolutely. All of us on the committee were surprised at the attitude of the EHRC, especially as their evidence was initially positive and constructive.

[Mr Burrowes]

I hope that the Minister will make at least one point clear to us. The EHRC says that it wants an instruction from the Government, and the Government say that it is properly a matter for the EHRC. We need clarity to ensure that we do not drop the ball and that previous good work is carried forward. We must be able at least to sort that out today.

[Natascha Engel]

Yes. I am going to skip around a bit and get hopelessly lost, so I might end up not doing all the bits that I wanted to, but I want to clarify that point. After the publication of the report, we had meetings with each of the different agencies that had given evidence and that we felt could do something to help. We have already mentioned the political parties, which must be the driving force, but all the other agencies were keen to help and open to recognising that there was a problem—that things were not working as well as they might once have done and certainly could work in the future.

Our issue with the EHRC was that it is the only organisation out of all those that came to give evidence to have one of those overarching umbrella roles. Obviously, the Commission for Racial Equality morphed into the EHRC, and we were sad to see that a lot of the excellent work that had been done in the CRE had got lost, shelved or was not carried forward. Our meetings with the EHRC were all focused on its budget cuts, on how it could no longer be as proactive as it might like and on how it was far more focused on providing policy research or legal help for those bringing cases of discrimination; it did not see its role as being anything to do with ensuring that conduct during election time was free, fair and not discriminatory. That kind of umbrella organisation is needed to lead the way, and we felt that leadership was lacking. All the other organisations can do what they like, but they do it in silos; we need the EHRC to knit everything together, so that we can all work together harmoniously to ensure that elections are more fairly conducted. Both of the points made by my right hon. Friend and the hon. Gentleman are enormously important.

We have a meeting with the Minister planned for June, and it would be enormously helpful if a senior member of the EHRC were present. We recognise what the EHRC was keen to point out—that it is independent of Government and it has a board that sets strategy and decides on what its budget is spent on; and, moreover, that the strategy has been set and the money allocated, and not for the work that we are doing—but if someone from the EHRC was present at our meeting in June and the problem is a lack of resourcing, we as parliamentarians might be able to help with that.

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

I was going to ask the Minister about this, but my understanding is that the EHRC has programme funding that is held back and can be bid for. Perhaps it could put in a bid for the very work that my hon. Friend is calling for.

[Natascha Engel]

That is a helpful intervention and we are discussing that. The issue, however, is one of attitude. What we were so surprised by was the “No” response, when everyone else was saying, “Yes, we really want to help, what can we do? How can we most constructively go about doing it?” The EHRC response was, instantly, “No.” It is a question of changing attitudes and seeing what each of us can do in our own capacity to make sure that the work can go ahead.

I have already mentioned the police; I should mention the Association of Chief Police Officers and specifically two people who have been enormously helpful and positive. Gary Cann and John Askew recognised that we can do a lot more and made constructive proposals about how we can go about doing so, as well as giving us the benefit of their experience, which was invaluable to our work.

The Electoral Commission was also extremely co-operative—we met with Jenny Watson after our report was published. The commission was willing to do anything within its remit and said that as long as political parties could agree on this step, it would be more than happy to be the signposting organisation. Lots of people already go to the Electoral Commission for advice and information, and it would be more than happy to signpost people—be they candidates or individuals with issues or complaints—to the available information. The Electoral Commission was keen to work not just with us but with the Equality and Human Rights Commission, the police and ACPO.

The political parties are key. The next election will be even tighter than before, and tensions are often higher in the run-up to tight elections than they would otherwise be. It is therefore important that all the political parties are signed up. Those of us here today represent different political parties; we should all act from within to make sure that our own party does everything it can. One helpful suggestion was the idea of having a named and prominent person within each political party to whom a complaint can be referred.

It is important that complaints are referred quickly, but one issue came up again and again. Often when some appalling behaviour occurs, whoever is responsible can be identified, and although people are sometimes reluctant to name names, they want the situation resolved quickly, before it gets out of hand. Sometimes candidates in general election campaigns behave in ways that their own political parties are not necessarily aware of, and would be shocked by if they were. It is a question of speed and of making sure that people—candidates and the electorate—are confident that political parties are dealing with problems quickly and that there will be an outcome. We will need safety nets to make sure there are not a million malicious and mischievous complaints, but if we are all committed, we can find a way to identify a threshold for such a process. Political parties are absolutely key.

The big problem we identified was third parties or non-parties—we are back to our racist in the garage printing nasty leaflets, who will not necessarily belong to any organised grouping and could simply be acting as an individual. Dealing with those people is going to be a big problem. Although we identified education as key to everything, we need to find ways to clamp down on that sort of non-party, third party organisation.

In summary—I want to allow others to speak—we would like the Minister not to interfere with the independence of the Equality and Human Rights Commission but to encourage it to work far more proactively with us and to show leadership. That will be key. We made a lot of progress with all the other agencies, so we want to encourage the EHRC to work more proactively with us. I have already mentioned our meeting with the Minister in June to make sure that she can encourage somebody from the EHRC to attend.

We also identified the press as a key area, but feel that there are some legislative weaknesses. Although we know that the Department for Culture, Media and Sport is not the Department dealing with the press code, we hope that in its work with the Press Complaints Commission, it can highlight that there is a problem. People complaining to the Press Complaints Commission have to do so on the grounds of inaccuracy—that is what they have to prove. We want the Press Complaints Commission specifically to look at discrimination and some of the appalling behaviour during elections. Inaccuracy to us means something completely different from discrimination.

Our final point is outside the Minister’s remit, but it would be useful if she passed it on to colleagues in the Department for Communities and Local Government. Local government has a massive role to play in how candidates behave during election campaigns. Much of the relevant training is conducted through local authorities, and democratic services and electoral services at local authority level have to deal with a lot of the complaints in the first place. A lot more training is needed; that training ended with the Commission for Racial Equality and we would like it to be picked up again, so there can be training in areas where there are local tensions. There is legal provision for local authorities to correct false or misleading information, but that is falling by the wayside a little at the moment, so will the Minister encourage her colleagues to highlight that with the Department to make sure that that provision is used properly?

Finally, I thank all the members of the committee, who gave long service to our inquiry—one of the oral evidence sessions lasted an entire day. Our members were the hon. Member for Pudsey (Stuart Andrew); Lord Alderdice; Lord Beecham; the hon. Member for Ealing Central and Acton (Angie Bray), who also acted as vice-chair and took on a lot of the chairman’s role; the hon. Member for Enfield, Southgate (Mr Burrowes); my right hon. Friend the Member for Tottenham (Mr Lammy); my hon. Friends the Members for Nottingham South (Lilian Greenwood) and for Feltham and Heston (Seema Malhotra); the right hon. Member for Hazel Grove (Sir Andrew Stunell); and the hon. Members for Belfast East (Naomi Long) and for Banff and Buchan (Dr Whiteford). I thank each and every one of them for all their service.

Our debate today is timely. There is exactly a year to go until the next general election, so the clock is ticking. If all of us—the agencies, the political parties and ourselves as parliamentarians— work together, we can make a difference and make sure that the next general election is cleaner, fairer, better and more just than previous elections. I hope we can foster an atmosphere of fairness so that we fight elections on policy, not on personality or people’s sexual orientation or religious or ethnic background.

14:58

[Sir Andrew Stunell (Hazel Grove) (LD)]

It is a pleasure to serve under your chairmanship, Mrs Main, in a debate that is very timely indeed. I thank the all-party group against anti-Semitism, which sponsored the inquiry, and the hon. Member for Bassetlaw (John Mann), who in many ways was the driving force in setting it up. I served on the inquiry; it was a useful process, and it brought to the attention of the House and others the fact that we have a problem, but that there are opportunities to tackle it.

The hon. Member for North East Derbyshire (Natascha Engel) has set out the range of evidence that we took and the recommendations we brought forward. There has to be a balance. While British elections are seen to be fair and run by decent-minded people in a decent way, if we look through any century of our democratic procedures—the 16th, 17th, 18th, 19th, 20th and, no doubt, 21st—we can see that our elections have been pretty bloodthirsty and robust. We are well aware that, in an open democratic society, there has to be robust debate that will sometimes be challenging and offensive. However, it must not descend to discrimination, violence, bullying, or a climate in which legitimate candidates are deterred from even participating because of the risks they could face if they did. I hope—indeed, I believe—that our recommendations will tackle that and provide the right balance. I hope that the Minister agrees.

It is good to have had excellent responses from the agencies that we have called on to take action—the police, via the Association of Chief Police Officers; the Equalities Office; the Electoral Commission; and political parties. I was pleased that the Deputy Prime Minister responded to the report, from the Front Bench, in an open and constructive way. I note that not all the political parties have yet found time to respond officially. Although it is customary to pose questions to Ministers, I hope that it is not completely out of place to pose a question to the shadow Minister: does the Labour party feel able to put forward a response? I know that the intention is there, but it would be good if we could say that there had been a full-hearted response from all the political parties.

When we produced our report, the so-called lobbying Bill was going through the House. There were some interesting side-discussions on what should be done about non-party and third-party campaigning. The Bill is now an Act, and we will see in due course how it works in practice. Personally, I think that it provides the right level of oversight and supervision of third-party campaigns. We took evidence that showed that some of the worst and most egregious examples of bad behaviour came from those sources—not, of course, from charities and mainstream campaigning groups, but from others who travel in their shadow.

That raises a point that came out clearly in the evidence that we took from all the political parties—we took evidence from a wide spectrum of them. All shared with us the ways in which they sought to tackle discriminatory behaviour in their parties; how they sought to ensure that their candidates were aware of their obligations as potential public representatives and servants; and their good intentions for the future. It is therefore unfortunate that we have to report that, since our recommendations were published, we have seen further examples of what might be characterised as bad behaviour. The front page of at least one Sunday newspaper had a whole string of examples, one of which was of a candidate from a political party seeking office in my constituency.

That clearly shows that the issue is not just about vision statements or good intentions, but about ensuring that the good intentions expressed to the inquiry reach down from party headquarters to the selection, training and preparation of candidates and their campaign organisers in the grass roots, where nomination forms are filled in, election leaflets are circulated and, in these days, stuff is put on Facebook and Twitter. We know that there is a way to go.

I want to focus the remainder of my remarks on the constructive role that I think the Equality and Human Rights Commission can play. I understand that the EHRC might struggle to deal with situations in the hurly-burly of an election campaign, after nominations have been submitted and once leaflets had been circulated. Perhaps it might reasonably say that the issue was a little bit out of its depth. However, what is not out of its depth is all the preparatory work that has to go on beforehand to ensure that candidates, political parties and civic society more generally are fully aware of the responsibilities someone takes on when they sign a nomination paper and put their name on a ballot paper. If the commission can play an active and constructive role in that—I believe that it can—then it is in by far the best position of all the bodies available to achieve that.

The chair of our inquiry told the House just a few minutes ago that the Commission for Racial Equality, the predecessor of the EHRC, has developed a toolkit. The CRE held discussions with local authorities, and there was a framework for action. There might be some discussion about how thorough that was and whether it went far enough, but one thing we can say about it is that we certainly did not want it switched off. It needs to be maintained and possibly enhanced, not cut back. It is unfortunate that the EHRC, having given positive evidence to the inquiry about its wishes and aspirations, has drawn back from that.

To pick up the point made in an intervention, the EHRC’s programme fund appears to be a suitable vehicle for promoting training and awareness in the way that I have sketched out. I hope that the Minister will agree to meet the EHRC and members of the inquiry to discuss how we can take the matter forward. Of course the EHRC is and should remain independent of Government —it should take its own decisions—but it is open both to members of the inquiry and the Government to point out to the EHRC that it has in its hands the capacity to take the matter forward. It has, in its charter and constitution, an obligation to ensure that discrimination is tackled in all its forms. Perhaps we can encourage it to move forward.

The commission seems to have come to the view that in an age of austerity, this is one thing it cannot afford. I would say that was a mistaken judgment. An age of austerity—when the potential for community tension is higher, not lower; when the world of politics is much more fluid than ever before; and when people who have previously been in the shadows are being attracted to put their names on ballot papers—is exactly the time when the EHRC should be invited to step forward, fulfil its role and play an active part in tackling the abuses and concerns that we have identified.

I can understand it if the Minister feels lukewarm or hesitant about my proposal. Having sat in her corner of the Chamber as a Minister with some responsibility for social cohesion in the Department for Communities and Local Government, I know that she will have some double-spaced typed sheets that tell her just what she can say and how far she can go. I would not want her to break free from those sheets of paper, but perhaps she can at least take away from this debate a clear understanding that with one year to go, there are real opportunities to get it right and real consequences of getting it wrong. She and her Department can do something to encourage good behaviour by the EHRC and other institutions in the public service to deliver results.

However, I do not want to focus only and entirely on the EHRC; I want to be right up-front and say it is a matter for the parties. Every responsible political party has to take that responsibility seriously when it comes to the training and selection of their candidates, and the training, selection and delivery of their campaigners and campaigns. They also have to create a climate inside their political parties that shows the wide respect that we all expect to see and all promote here in the House. I hope very much that the debate will be an opportunity to open a door, rather than leading to anybody shutting any doors to fair, strong, democratic election campaigning in the next 12 months.

15:10

[Lilian Greenwood (Nottingham South) (Lab)]

I begin by congratulating my hon. Friend the Member for North East Derbyshire (Natascha Engel) both on chairing the inquiry on electoral conduct and on securing today’s important debate, which, as a number of Members have pointed out, is happening precisely one year before the next general election; I am sure that all of us were very aware of that.

I only want to say a few words, because I know that other hon. Members wish to contribute to the debate—in particular, the hon. Member for Ilford North (Mr Scott), who will bring great insight to these proceedings. I was pleased to serve as a member of the inquiry and was heartened when the general secretary of the Labour party said that he welcomed the report’s publication, but I am speaking in a personal capacity today.

All hon. Members will know from their campaigning experience that there is a kernel of truth behind the report’s key conclusion that

“there are insufficient support networks or referral systems in place for candidates suffering discrimination.”

Indeed, there is worrying evidence that reporting of such incidents may have declined in recent years.

The report contains compelling evidence that the law and regulations governing elections do not provide adequate protection for some candidates. We should remember that, as the report states, we do not compare unfavourably with many European countries, but there is a strong case for a wider review, and I hope that the Minister will study the report’s recommendations carefully—I am sure she already has—and respond positively to them.

We must always be vigilant in protecting our freedom of speech, but we also need to make sure that all sections of society feel able to take part in the democratic process, and that protections are in place to ensure that candidates are not dissuaded from standing for election. As my hon. Friend the Member for North East Derbyshire said, some Members, former Members and candidates have been subject to truly dreadful incidents and/or experiences. Their bravery in speaking out about those experiences is both welcome and necessary, particularly as we would all share the view, I believe, that Parliament needs to be as diverse as the country that we live in and seek to represent. The report represents an important step towards achieving the balance between freedom of speech and protection of potential candidates.

I finish by putting on record my thanks to everyone who contributed to the report, and particularly to the director of the Parliamentary Committee Against Antisemitism Foundation, Danny Stone, for his outstanding work and for making publication of the report possible.

15:14

[Mr Lee Scott (Ilford North) (Con)]

I start by thanking the hon. Member for North East Derbyshire (Natascha Engel) and her committee for all the work they have done, and I thank her for securing today’s debate. Originally, I was not going to speak in this debate—I know that many people say in debates that it was not their intention to speak, but it genuinely was not. However, I would like briefly to touch on what happened, the consequences of that, and on what is still happening because of the events that took place before the 2010 general election.

At that election, I remember very clearly that on a Friday, I was walking back to my car when two gentlemen—I use the word “gentlemen” very loosely—approached me, called me a dirty Jew and said they were going to kill me. I thought that was a bit extreme—not voting for me would have sufficed, but killing me seemed a little extreme—and I did what I normally do when I am particularly scared, and that is to use humour. I said, “I will put you down as a possible. You haven’t decided how you’re voting, have you?” They were as shocked by that as I was, and we ran off in separate directions.

Consequently, a week later, somebody gave me a leaflet that had been distributed in the area saying that I was an enemy of Islam, with a picture of me wearing a skull cap—it could only have been taken in a synagogue, which I felt was a bit wrong—and had statements on there that were totally wrong. It put words into my mouth that I had never said; none the less, it was given out and as the hon. Member for North East Derbyshire said, there was no imprint on the bottom. I was quite surprised when some of the authorities asked me, “Was there an imprint on the bottom?” I said, “When people are threatening to kill you, they do not usually say who they are.” None the less, the leaflet went out with quite a wide circulation.

That was some four years ago, so you would have thought, Mrs Main, that that has all died down, that it is history, that I won at the election and it is finished, but sadly it is not. I still regularly get e-mails saying that I should be stoned to death. Again, I am not quite sure why; none the less, I get them. After speaking in January at the Holocaust memorial day debate that we had in the Chamber, I also received a letter—again, there was no address on it—calling me a dirty Jew and saying that I should be killed for speaking up against people killing Jews. I found the whole thing ironic and stupid and said to the police that I did not want it taken any further, because it would have wasted valuable time on somebody who is not worthy of wasting any time on.

However, the consequences of what is stirred up at a general election—whether, in my case, because I am Jewish, or in somebody else’s case, because of their sexuality, or maybe other religions, or the colour of their skin—goes on for years afterwards. Sadly, anyone can google my name and the names of other hon. Members of the House and see some of the vile things that are on the net today.

I agree totally with the right hon. Member for Hazel Grove (Sir Andrew Stunell) that political parties and the authorities have a responsibility, but I think it goes beyond that. At some stage, somebody, somewhere, needs to be prosecuted, found guilty and punished for it, because of the distress that they cause. I am talking not about hon. Members—I say openly that when we put ourselves up for election we have to have a pretty thick skin; I am not a shrinking violet—but about their families. My family should not have had to go through what they had to go through and have panic buttons, or come with me to meetings where I had two police officers with me, which made it look like I was out on bail, not attending hustings. It is ridiculous that it is allowed to happen.

With the rise of not only anti-Semitism but homophobia and any other thing we could mention, I fear that the problem is not going to go away or get better. We could see it get a lot worse. As the hon. Member for North East Derbyshire rightly said, we are told that the next election will be very close, which will mean that sometimes, people might get carried away. Going beyond the main parties—or even the smaller of the main parties—I saw a leaflet for the council elections in my borough in the past three weeks. I will not name who sent it; the name was on there, but I do not want to give them the publicity. It was disgraceful—absolutely vile and disgraceful. It included pictures—I am not saying for one second it is illegal, but it does incite hatred and contain lies. The consequences of that—we will find out; we will face them. In some cases, it may well be somebody in their back garage printing leaflets, but the leaflet that was put out about me was not printed in a back garage. It was printed professionally. It was glossy and it was handed out.

We have a lot of ongoing problems. The work of the committee, Danny Stone and everyone involved in highlighting those is tremendous. I commend all the political parties for taking it on board. I pay tribute to the leader of the Liberal Democrat party for engaging with what is said, and I know that other political parties will do likewise. The Minister—I am honoured to call her my hon. Friend, and we have been friends for quite a long while—knows those problems and will also take them on board.

I fear that this is going to go way beyond the present position, because some of the organisations that perpetrate such behaviour are vile: we can read their websites and find out what they are saying about each and every one of us. What is happening is just vile.

As I said, it was not my intention to speak today. I am not ashamed to say—I have said it publicly before—that on the evening of the last election, I went home and did something I had not done since the birth of my child, who is 25: I actually cried. I said, “What the hell am I doing this to myself for? Do I really want to do this, and do I want to be an MP? Is it worth it for my family?” As it happens, I believe that it is, because the good work of every Member of Parliament, irrespective of their party and where they are, who tries to help their constituents to the best of their ability, is worth the pain. However, it has gone on for five years and I have no expectation that it will stop; it will carry on through to the next general election and—forgive me—for the next five years as well, I hope. The electorate will decide that next year, of course. None the less, it is a horrible thing to go through; I say that for my family rather than myself.

15:20

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

It is a pleasure to serve under your chairmanship, Mrs Main. I thank my hon. Friend the Member for North East Derbyshire (Natascha Engel) for securing this important debate and opening it so well. She and her colleagues should be congratulated for their stewardship of the inquiry on electoral conduct and the quality of the excellent report they produced, which we are discussing today. I also commend my hon. Friend the Member for Bassetlaw (John Mann), who is not in his place at the moment, and who chairs the all-party group on anti-Semitism, for its tireless work in tackling discrimination at all levels.

The report has plugged a big gap in the study of the democratic process in the UK and I hope that it will become compulsory reading for everyone, from political parties and candidates to local authority officials, and particularly for the Electoral Commission and the Equality and Human Rights Commission. It contains examples of the worst of human behaviour, some of which we heard about from the hon. Member for Ilford North (Mr Scott). He was brave to talk about it, and even braver to live with it day in, day out. I commend him for his determination to carry on doing so. It is all the more horrendous, reading the report, to realise that such things have been perpetrated against people we know and consider friends. For instance, there is discussion of the pig’s head left outside the family home of Parmjit Dhanda, a former Minister who was an excellent colleague. The report also highlights things written in his local newspaper. Colleagues yesterday reminded me of the anti-Semitic campaign waged against my right hon. Friend the Member for Manchester, Gorton (Sir Gerald Kaufman) by his Lib Dem opponent at the last election.

One of the issues I am looking at, at the moment, is how we can increase the representation of people from black and minority ethnic communities at all levels of the political system, not in a spirit of box-ticking or tokenism, but because our political system and the decisions that it makes are better if they more accurately reflect the country and the communities they affect. I am sure that for many candidates the threat of their skin colour, background or faith—not to mention their children’s or relatives’—being turned into smears or innuendo or leading to harassment or abuse such as we have heard about today is a real consideration. Of course, that applies to gender as well.

I am sure that the Minister and other hon. Members will be aware that the all-party group on women in Parliament is doing significant work on the issue, and I am pleased to be on the panel for that. I worry that the fear I have described will mean that many excellent candidates never seek their local party’s nomination or get the chance to be elected. None of us goes into politics without the fear of attack, and none of us is immune from attack on some level; but we should always expect any attacks on us to be based on choices or decisions that we have made, the things we have said, the way we have voted, or what we have done. We should never accept attacks based on the things we cannot change about ourselves, such as race, gender, sexual orientation or disabilities. Neither should we attack others, or allow them to be attacked by our supporters or others, in that vein.

Every talented and enthusiastic potential candidate who shrinks away from seeking office because of the fear, perceived or real, that they will be the victim of discrimination, is a loss to their community and the country. Those people are also a loss to the political party that they might have represented. Political parties owe their survival to the continual need to bring through new talent and come up with new ideas. They cannot afford to exclude people from that, and neither can they afford people excluding themselves because of a fear of discrimination.

If for no other reason than that, all the major political parties should pay close heed to the recommendations in the report—particularly on how they support candidates in withstanding such attacks. I am happy to discuss that with my hon. Friend the Member for North East Derbyshire in my role as Labour’s spokesperson on equalities. She and our colleagues will know that there are some support networks out there. For example, I am a mentor for the Fabian women’s network candidates programme, and have been paired with our prospective parliamentary candidate for Brighton, Kemptown. The party has its own future candidates programme, and I am sure that other parties do similar things. I am certainly keen to discuss with my hon. Friend what more we can do.

The debate is timely, in the sense that we are well into an electoral period in which there has rightly been a particular focus on the views of certain candidates—and particularly those of a certain party. However, as the report makes clear, the problems are not exclusive to an individual party or to far-right groups. Nor are they confined to a certain election or historical period. They are persistent, cyclical problems that will continue unless we do something meaningful about them.

[Natascha Engel]

One of the big problems we found was that the mainstream political parties feel that they already have processes in place; they do not want people to see them as not working as well as they should on the issue. Will my hon. Friend work within the Labour party to ensure that we are committed to signing up to something with all the other political parties, rather than working with them in a conflictual manner, so that we can achieve the greater aim? I just want to get her commitment to work within the Labour party so that we can do that from our side.

[Mrs Hodgson]

I can definitely give that commitment today to work with my hon. Friend to see what we can do within our party.

The central thing that I took from the report was the need for a statutory body to take a lead. There is much that political parties can do and agree on, especially at this time in the electoral cycle, but we should not be under any illusion: come 2015, all political parties will be primarily and almost myopically focused on the campaign and on winning every vote they can. It will simply not be possible for national or even regional officers to vet or review every single leaflet, YouTube clip or tweet from their candidates or their opponents, or anyone else who seeks to influence votes, as in the kind of non-party campaigning outlined in the report. Nor is it possible for political parties to issue guidance to public bodies on their duties to promote equality and good relations between communities.

We have an Electoral Commission and an Equality and Human Rights Commission; and we also have the police for when things really cross over into illegality, such as in the incident described by the hon. Member for Ilford North. The EHRC has had serious budget and staff cuts during this Parliament, but I cannot believe that it no longer has the capacity to play a role. After all, what could be more damaging to equality and good relations between communities than influential people such as local or national politicians using discriminatory language, producing discriminatory campaign literature, or being seen to condone such discrimination?

[Dr Eilidh Whiteford (Banff and Buchan) (SNP)]

The hon. Lady is making an important point. One issue that we identified when compiling the report was that it is very difficult for any authority to take timely action, because often, by the time an investigation has taken place, the election is over and done with and in some cases there has been an impact on the outcome. That is one of the most serious and difficult issues for us to grapple with.

[Mrs Hodgson]

The hon. Lady makes a very good point. There was a case in which action was taken and a Member of Parliament was forced to step down because of something that had happened. However, the hon. Lady is right: the delay can sometimes mean that it is very difficult to follow things up.

I understand that the Government now hold a programme budget back from the Equality and Human Rights Commission, for which it has to bid in relation to specific pieces of work. I believe that a portion of that fund may have been allocated since the report was published, but that some remains. The Minister may be able to tell us whether the EHRC has bid, or is bidding, for some of the fund to do this work ahead of next year’s general election, or whether she would like to recommend that it do so following the report.

Police forces have also seen their budgets cut considerably, and understandably, electoral conduct is only a very small issue for them. Again, however, there is clearly merit, from a crime prevention point of view, in ensuring that they stamp out discrimination in electoral campaigns before it reaches the point described in the report, with police having to escort the hon. Member for Ilford North to hustings and stepping in in Bethnal Green and Bow in 2005. Of course, the Electoral Commission has a responsibility to ensure that elections are conducted in an orderly way. It seems sensible for that to include an overarching responsibility to pull together the various strands of work to help to prevent discrimination.

We should not forget that the vast majority of political campaigning in this country, and certainly that done by the parties represented in the Commons, maintains very high standards. Yes, it is often negative in tone and it is sometimes, regrettably, personal in nature, but by and large it seeks to highlight facts and figures and policies and records, whereas discrimination in all its forms, whether it is born out of ignorance, irrational fear or plain old stupidity, is simply unacceptable in 21st-century Britain and should not go unchallenged. But even more than that, discriminatory behaviour, and the encouragement of such behaviour by others, that is born out of cynical calculation, a desire for self-promotion or simply cowardice is absolutely despicable and should have no place whatever in British politics.

It is our responsibility as people who serve our constituents—not just some of them, but all of them—not just to avoid discriminatory behaviour and language ourselves, but to challenge it wherever we find it. Doing and saying nothing is not being diplomatic; it is pandering to it and tacitly agreeing with it. I believe that, as elected representatives, we have a responsibility, a duty, to lead work aimed at strengthening the bonds that tie communities together, not to stoke the flames of suspicion, fear and illogical hatred, which rip them apart. That duty applies just as much when we are seeking the support of those communities in an election as when we are not.

I have already said that I am more than happy to speak further to my hon. Friend the Member for North East Derbyshire about what we can do within the Labour party on these issues. I agree with her recommendation that each political party have a named person to take the lead on them. However, she and her colleagues are right to say that this is a cross-party issue, so although I am looking forward to hearing what the Minister intends to do to address some of the concerns raised by the report and by my hon. Friends and others during the debate, I for one would be happy for the debate to continue outside the Chamber and to see what action we can agree on a cross-party basis.

My hon. Friend the Member for North East Derbyshire and her colleagues on the inquiry panel have set a great example, and it is important that their work now be taken forward and that we do everything we can to stamp out discrimination and the victimisation of others for political gain.

15:34

[The Parliamentary Under-Secretary of State for Women and Equalities (Mrs Helen Grant)]

It is a great pleasure to serve under your chairmanship, Mrs Main. I thank all hon. Members for their passionate and sensitive speeches and many interventions about an issue that is certainly important to us all. Also, right at the beginning, I congratulate the all-party parliamentary inquiry into electoral conduct on its work. I was personally dismayed by the shocking examples of racism and discrimination during election campaigns featured in the detailed report that was produced.

The hon. Member for North East Derbyshire (Natascha Engel), who introduced the debate, already knows this, but for the benefit of the other people in the Chamber, I can confirm that a meeting has been set up for us in, I believe, June—I am not sure of the precise date. I look forward to meeting her. I am also very happy to meet members of the commission to discuss the inquiry’s findings. This is a very important issue to the Government and to me, as the Minister for Women and Equalities. As my right hon. Friend the Prime Minister said when the inquiry published its report, we need to ensure that we keep this sort of horrible racism out of politics. That is exactly what some of the conduct and behaviour is.

As Minister for Women and Equalities, I recently took part in a debate on parliamentary representation. It was clear from the discussion that the Government, political parties and Parliament are making quite good progress, but it was recognised by everyone that we still have a very long way to go. I believe that tackling prejudice and ignorance is essential to the functioning of our democracy. Human rights principles provide a basis from which to build and maintain a safer, more prosperous, cohesive society, with care and consideration for the dignity and well-being of everyone at its heart.

Eleanor Roosevelt spoke about the importance of making the universal declaration of human rights

“a living document, something that is not just words on paper”;

something that is not just written down, but that we

“bring to the lives of all people”.

When the UN General Assembly agreed the Paris principles, Roosevelt’s vision started to become a reality. The Paris principles detail the role that national human rights institutions are expected to perform and make it very clear that such institutions must be independent of Government and that their independence must be guaranteed in legislation. The Equality Act 2006 established the Equality and Human Rights Commission, Britain’s first national human rights institution. The EHRC is independent of Government, and its remit is limited to equality and human rights issues. In 2009, the United Nations reviewed the EHRC’s work and structures and subsequently designated it an A-status national human rights institution, which means that it fully complies with the Paris principles.

The hon. Member for North East Derbyshire and many other hon. Members have raised genuine concerns about the EHRC and its response to the inquiry’s recommendations. I will respond to some of those concerns in as much detail as I can. I know it has been claimed that the commission should engage in certain work and that it should be taking responsibility and showing enthusiasm. However, if the Government failed to respect the independence of the EHRC by requiring it to do certain work, the EHRC could see its status downgraded or cease to be recognised as a national human rights institution by the United Nations. I understand what the hon. Lady is saying, but I think that it is for the all-party group against anti-Semitism, which has played an important role in getting us to the position that we are in today, or hon. Members with concerns or other relevant groups, to make the case to the EHRC’s board, which sets the work programme. I will come back later to the question of encouragement.

If the Government directed the EHRC to create an election toolkit, which was recommendation 1 in the inquiry’s report, we would be asking a regulator charged with ensuring people’s freedom of expression to seek to limit how people exercised that freedom of expression in relation to campaigning. That would create a degree of inconsistency. The Government believe that it is for individual political parties to decide what they want. If they feel that such a toolkit might be useful, it is for them to produce one.

Various political advertisements have been mentioned today, and it is worth noting that political advertising is exempt from the British codes on advertising and sales promotion. Consequently, even the bodies that could in principle regulate in this area are unable to do so. The best course of action—it is a practical one, which often works—for anyone with concerns about a political advert is to contact the party responsible and exercise their democratic right to tell that party exactly what they think. If it is felt that the advert amounts to discrimination or hate crime, that is a matter for the courts and the police. The police take hate crime and racism very seriously.

[Sir Andrew Stunell]

The guidelines made available by the CRE were used extensively by local authorities, returning officers and others who regulate the election process. Does the Minister not see a wider role than simply issuing guidelines to political parties?

[Mrs Grant]

I hear what the right hon. Gentleman has to say, and I know that he participated in the inquiry. However, the issues are electoral ones. The Electoral Commission publishes guidance and deals with misconduct. If the sin or the abuse is worse than misconduct, it is, of course, discrimination and it is dealt with by the courts. If it is worse than that—if it amounts to hate crime or racism—the police will take such matters seriously. If political parties feel that codes of practice are needed, it is for them to reach agreement and produce such codes.

[Natascha Engel]

I think the point that the right hon. Member for Hazel Grove (Sir Andrew Stunell) raised, which I would like to raise as well, is that there is a need for the EHRC to look at preventing discrimination. The Minister is talking about a process for dealing with discrimination when it is found, but we are saying that it would be much better if the EHRC were more proactive in going out and training, advising and using toolkits to prevent discrimination from happening in the first place.

[Mrs Grant]

I hear and understand the point that the hon. Lady is making. The EHRC is a highly respected, A-status established body. I know that she has concerns, but the EHRC does a huge amount of work to tackle unlawful discrimination and promote equality. Should it do more? That is something that we might discuss in our meeting in June, but I must emphasise that the EHRC is independent, and it must decide what it will do. It is important that lobbyists lobby appropriately, particularly when it comes to racism and discrimination. I will say a little more about the role and function of the EHRC as I progress.

If the EHRC’s remit was extended to cover electoral law, it might go beyond its powers as specified in the Equality Act 2010. Some of the ideas raised today might well result in such an outcome, so we must be careful. It would be inappropriate for the EHRC to draw up annual guidance on electoral conduct, as set out in recommendation 3 of the inquiry report—the Electoral Commission leads on that area—or on hate crime, which the police enforce through the courts. Instead, the Government believe that relevant groups, including all-party parliamentary groups, and hon. Members who have concerns must work with the Electoral Commission and the police to deliver recommendations aimed at electoral reform, criminal harassment and hate crime.

I agree with the all-party parliamentary inquiry that it is important that people know exactly where to go if a candidate’s campaign material contains false or misleading statements or breaches of electoral rules. However, the Electoral Commission already produces guidance for the police and the Association of Chief Police Officers, so it seems sensible for the police and the Electoral Commission to ensure that that guidance covers discrimination and hate crime rather than for the EHRC to create separate guidance. We are in agreement about what needs to be done; it is simply a question of the vehicle, the tool or the method by which we achieve it. I want to work with the hon. Member for North East Derbyshire on this.

Recommendation 19 suggests that the EHRC should produce a standardised framework for reporting discrimination during election campaigns. In practice, the Electoral Commission and the police have their own published guidance on how to report electoral misconduct and how to report a crime. Guidance on reporting unlawful discrimination is available from the Equality Advisory and Support Service, which is funded by the Department for Culture, Media and Sport.

Let me pick up some of the other questions that I have been asked. I have touched on the question of encouraging the EHRC to work more proactively and to show leadership, and we can certainly discuss that when we meet in June. I will be happy to see the hon. Lady and members of the commission there. Of course, the EHRC will be invited, and I am hopeful that a very senior person will be able to attend. As I have said, it is for relevant groups, APPGs and concerned Members of the House to lobby and make the case to the EHRC’s board, which sets its work programme. My right hon. Friend the Member for Hazel Grove (Sir Andrew Stunell) will be pleased, because I am moving right off the type of script that he described. The EHRC may be able to provide assistance, and when we meet, we can discuss that further.

The hon. Member for North East Derbyshire mentioned the press code and asked whether the Department for Culture, Media and Sport could raise with the Press Complaints Commission the issue of discrimination. The standards code is a matter for press self-regulation, not for Government, but I hope that there will be an opportunity for organisations to put forward their views on any revisions to the standards in the code.

What the hon. Lady had to say about the possibilities for local authorities was very interesting. I am happy to raise such issues with Ministers from the Department for Communities and Local Government, but I can tell her now that it is already an offence to make or publish false statements about the personal character or conduct of other candidates; it is also an offence to publish or distribute threatening, abusive or insulting material that is intended to stir up racial hatred. Of course, it is for the returning officer to investigate any claims of electoral malpractice, and they would refer the matter to the police for further investigation if necessary.

The shadow Minister, the hon. Member for Washington and Sunderland West (Mrs Hodgson), asked a couple of times whether the EHRC could use the programme funding to help to fund the type of work we are discussing, if it felt that that was appropriate; my right hon. Friend the Member for Hazel Grove (Sir Andrew Stunell) also raised that issue. I can tell them both that programme funding bids can be made, provided they do not overlap with the work of other Government Departments or agencies. It is a matter for the EHRC to make that application, not for the Government to tell it to do so, and it must decide what work it considers appropriate and wants to do. The shadow Minister asked whether any such bid had been made thus far; to my knowledge, no bid has been made in relation to this particular type of work.

The shadow Minister asked about the current role and functioning of the EHRC. It certainly does want to promote understanding and good practice, and it has indicated that it will use its powers under section 8 of the Equality Act 2006 to enable it to do so with any interested parties. However, as the hon. Lady knows, the EHRC no longer has a specific good relations mandate, and the Equality Acts do not apply specifically to electoral conduct.

Budget cuts were raised, but I am not going to dwell on that because I do not want us to be distracted from such an important debate, which focuses on the very important problems of discrimination and racism. Nevertheless, I can confirm that the EHRC was not established to deal with electoral issues; it was set up to deal with equality and human rights issues.

The parliamentary inquiry on electoral conduct was thorough and detailed and made recommendations to a number of bodies, including the Electoral Commission, the police and political parties. Building its findings into current work and guidance and working with the right organisations is the best way to ensure that political life becomes a battle of ideas, not of race hate and discrimination. The inquiry raised very important issues relating to racism and discrimination in elections that must be dealt with. The means to tackle those problems are in place, but it is important that all concerned work towards combating racism and discrimination. I will of course play my part where I can.

[Mrs Anne Main (in the Chair)]

Order. I thank the Minister who is due to respond to the next debate for attending in such a timely fashion. He has agreed to the debate starting early, with the permission of the hon. Member who initiated the debate.

Employment and Support Allowance Application

Wednesday 7th May 2014 Westminster Hall

15:54

[Dr Eilidh Whiteford (Banff and Buchan) (SNP)]

It is a pleasure to serve under your chairmanship in this short debate on the employment and support allowance application process for those with mental health problems, Mrs Main. We may be a small, select company this afternoon, but I am sure that I am not the only MP to have seen over the past couple of years a steady and increasing stream of people with quite serious mental illnesses falling through our social safety net, which is now very frayed because of welfare reforms. Despite modifications, the work capability assessment is still failing too many people.

It goes without saying that most people with a mental illness will never need to depend on the benefits system, but some of those with more severe or persistent illnesses do require support, and some of them are extremely vulnerable. In the time we have for this debate, I want to focus on the shortcomings of work capability assessments with regard to mental health conditions and make some concrete suggestions about how the process might be improved.

The issue is by no means new. Ever since the introduction of the work capability assessment, mental health care professionals and representative organisations have expressed concerns that it does not capture the impact of more serious mental illnesses on a person’s capacity to function in a working environment and consequently leads to poor decision making. A core problem is that too often assessors and decision makers have little or no relevant background information about claimants’ complex medical histories and too rarely seek input or opinions from claimants’ clinicians.

The problems were clearly acknowledged at the time of the first Harrington review, when Professor Harrington said that decision makers should be

“able to seek appropriate chosen healthcare professional advice”.

In his third review, he recommended that they

“should actively consider the need to seek further documentary evidence in every claimant’s case”.

The fourth review, led by Paul Litchfield, devoted significant attention to the assessment of mental function and made a number of recommendations, some of which the Government have accepted. However, the Royal College of Psychiatrists said this week that

“there is little evidence of any significant increase in the collection of evidence by either ATOS HCPs or DWP Decision Makers.”

The issue is not going away; indeed, it is being compounded by the new Department for Work and Pensions sanctions regime, which is having an acute effect on people with mental health conditions. According to a freedom of information request, in 2013, 58%—almost six out of 10—ESA claimants sanctioned were people with a mental health condition or learning difficulty. That is an increase from 35% of sanctioned claimants in 2009, and it suggests that people with mental health problems are being inappropriately sanctioned.

There is a growing body of evidence from a range of sources that, in spite of the changes that have been implemented along the way, the work capability assessment is still failing people with serious mental health problems. However, I want to highlight the report published recently by the Scottish Association for Mental Health, or SAMH, which details findings on how experiences of living in poverty affect peoples’ mental health, and how SAMH service users have been affected by welfare reforms.

SAMH has been a leading mental health charity in Scotland for many decades and works directly with thousands of people across the country, helping them to recover from mental illness and offering support and training. It also works to improve policy and practice in relation to mental health, reduce stigma, raise awareness and promote well-being. SAMH undertook a major survey of its service users in 2013. The truly shocking finding was that 98% of respondents said that welfare reforms were negatively affecting their mental health, including increasing stress and anxiety, while 79% were also facing financial problems. Of SAMH staff, 85% said that they were having to provide additional support to service users as a direct result of the welfare reforms, and, in six cases, SAMH staff had to carry out suicide interventions directly related to welfare reforms.

I know that the Minister will be well aware of the tragic case of a woman known as Ms DE, whose suicide in 2011 was the subject of an investigation by the Mental Welfare Commission for Scotland. Ms DE took her own life after scoring zero points in a work capability assessment made in the absence of an ESA50 form and without any additional information from her clinicians. The only information her assessor had about her condition was the single word “depression”, a word that in her case masked a long and difficult psychiatric history. Both her general practitioner and consultant psychiatrist considered Ms DE unfit for work at the time of her death, even though she had worked for most of her adult life. Indeed, the significant event review after her death noted that

“Ms DE was hoping to return to employment at some point.”

However, it also noted the distress caused by her benefits assessment and the role that it may have played in her suicide, concluding that there was “no other known trigger”.

[Jim Shannon (Strangford) (DUP)]

I am grateful to the hon. Lady for giving way, and for her permission to make an intervention. Just this week my office has dealt with two ESA appeals and four inquiries on the subject. Each one of those six cases relates to addiction or mental health problems. I am very aware of the far-reaching impact that the process has on people, which the hon. Lady outlined. Does she agree—she probably will—that if there is no compassion and understanding in the system, as there seems not to be, many other people will come to the same point as the lady whose case she is describing?

[Dr Whiteford]

I think that is right. On reading the evidence produced by organisations that support people with mental health problems, it is very clear that the increased anxiety and stress can contribute to ill health and make people more ill than they were to start with.

The report makes upsetting reading, and we should all express condolences to the unnamed woman’s family. Her death is a sobering reminder to all of us of the very real impact that Government decisions and state bureaucracies have on people’s lives. However, I was also struck by the very robust terms in which the Mental Welfare Commission, a statutory body, questioned the effectiveness and appropriateness of the work capability assessment and how it was working. As part of its investigation, the Mental Welfare Commission conducted a survey of responsible medical officers working in health boards across Scotland, most of whom are consultant psychiatrists, and 80% of respondents had patients who had undergone work capability assessments. Of those 80%, most had been asked to provide medical evidence, either before or after the assessments. However, three quarters had never been asked for their opinion at any point in the Atos or DWP process. Only 25% had had a request—some before the assessment, some after—and 96% said that their patients had been distressed by the assessment process; 93% reported patients distressed at the outcome of an assessment; and 80% reported patients who had successfully appealed decisions.

What also gave me great cause for concern was the impact on clinical care provision: 85% of the RMOs reported an increased frequency of appointments; 65% had had at least one patient who required an increased dose of medication; 35% had at least one patient who had been admitted to hospital as a consequence of a work capability assessment; 40% had at least one patient who had self-harmed after the assessment; 13% reported that a patient had attempted suicide; and two psychiatrists reported patients actually taking their own lives. In the light of the anecdotal evidence from the hon. Member for Strangford (Jim Shannon), I can say that various sources show that this is not just hearsay; evidence is coming from reliable and credible people who are involved in the process, and who understand that the systems are having real and difficult consequences for people.

It is critical that greater use of expertise is drawn into the assessment process for claimants with mental health conditions. I acknowledge the conclusions of the Litchfield review on this point, which were that it may not be necessary in every case, but there seems to be an enormous gulf between a universal approach and current practice. It is a chasm into which large numbers of very ill and vulnerable people seem to be falling. SAMH found that 56% of its service users did not receive any supporting information from a health care professional in their ESA application, which, in the wake of the tragedies we have heard about, should shake us out of any sense of complacency that we are doing enough.

The DWP’s most recent quarterly statistical bulletin, published in March, outlined the total caseload to date. With regard to completed claims, 52% of people who made new applications for ESA on the grounds of mental or behavioural disorders were found fit for work, so the high numbers of people awarded ESA on grounds of mental ill health represent less than half of applications made because of these conditions. Too many people are falling through cracks in the assessment process. I have alluded to the increased pressure that this creates in the NHS, but it also brings attendant costs in social care, policing and homelessness, which outstrip the cost savings that the DWP might be making.

Throughout the work of the Harrington and Litchfield reviews, there is an implicit acknowledgment that the work capability assessment is not working as it should and not working well enough for people with mental health problems. My request to the Minister today is simple: will he meet me and representatives of SAMH to discuss some of the ways in which the recommended improvements might be integrated into the work capability assessment?

I know some changes have been instigated since 2010, and I note Professor Harrington’s evidence-based review of December 2013, which considered whether a more specialised test developed with disability organisations might be more effective. Although that test was found to be less effective than the work capability assessment in determining fitness for work, it proved more effective in determining limited capability for work. Lessons could be learned from the scoring approach used in each assessment, so I want to ask the Minister whether he can provide an update on how the Government are using those insights to improve the work capability assessment.

It was announced in March that Atos Healthcare will leave its contract early, with new contractors commencing in 2015. The renegotiation of the contract presents an ideal opportunity for the DWP to reconsider how the right information and expert opinions can be brought into the assessment and decision-making processes. SAMH is of the view that claimants should be asked at the beginning of their application to nominate relevant health care professionals to provide supporting statements. That would significantly reduce the stress on individuals, improve input from professionals, and, we have to conclude, lead to better decisions the first time round, reducing the need for costly and stressful appeals. With the DWP in the process of reviewing and updating its contract, surely this is a prime opportunity—the ideal moment—to introduce a process by which the statements could be secured. What practical steps might the Minister take to move this forward?

Lastly, the SAMH report highlights the increased stress and anxiety for claimants who face lengthy waits for assessments, often have to live on a reduced income, and fear that they will not get a fair assessment. That has come out in the past few years as people see what happens to those in their support groups and social networks, who have come through the system and feel that the assessment concentrated on their physical health, not their mental health. Sometimes their physical symptoms can be connected to their mental health problems, but they are often more easy to cope with in day-to-day life than the debilitating effects of mental illness.

The reduction in support services as a result of austerity cuts has left some very unwell people unsupported. The DWP could minimise such distress by providing clear, accessible information to applicants at the outset of the process, signposting them to organisations that can provide advice on welfare rights, finances and well-being, and setting out the process by which health care professionals can be contacted regarding supporting statements.

[Jim Shannon]

Problems have come to my attention relating to correspondence with those who have mental health issues. Often, correspondence is mislaid or inappropriately addressed, which means that people with mental health issues are not aware of the process and how they should respond to it. The Minister always responds positively to the issues, but does the hon. Lady feel that one of the things that could be done better, when dealing with people with addiction and mental health issues, is ensuring a follow-up whenever responses are not made directly to the Department?

[Dr Whiteford]

The hon. Gentleman makes a very important point. Indeed, that was one of the key recommendations of the report by the Mental Welfare Commission for Scotland in the case of Ms DE. Attempts had been made to contact her, but there were no repeat attempts and no one managed to get hold of her. It is easy to envisage somebody who is suffering from severe depression not answering the phone and not opening the mail in the way that someone in a healthier situation was more able and minded to. Those points have been well made, and I am sure that the Minister is already cognisant of them, but I will be interested in his response on the process, particularly in the DWP, going forward.

Relatively small steps could have a marked impact on people’s lives, and could help ensure that the process does not actively contribute to people’s mental health problems, but helps set them on the road to recovery. Will the Minister consider what he can do in terms of signposting, explaining to people their rights in the process, and making sure that we are not making things worse for people who are already very ill? It is in everyone’s interests to achieve a work capability assessment that is fit for purpose. I hope that the Minister will take the time to read the SAMH report and hear the perspectives of those with most at stake in the process and who badly need our support, and I hope he will meet us in the not-too-distant future.

16:08

[The Minister of State, Department for Work and Pensions (Mike Penning)]

In the short time that I have before we go to vote—I will continue when we come back—may I congratulate the hon. Member for Banff and Buchan (Dr Whiteford) on securing this debate on a very important issue? In the short period that I have been the Minister in the Department, the issue has occupied a huge amount of my time, not least because, like many families in this country, my family has been touched by mental health issues, including depression, so I understand the issues very well. Even if I do not agree with all the hon. Lady’s comments, I know that they were heartfelt.

Some of the things that we are trying to do aim to get to the core of how we can deliver a service that is fit for purpose—I often use this term—in both ways. I have met so many people with mental health illness who want to work. A lot of them, particularly those with depression, tell me that their conditions, which some of them have had since long before I became a Member of Parliament, have got worse because they have not had assistance to go to work. They want to be part of the community and want to feel as if they are contributing; they do not necessarily want to be on benefits—something that a lot of them find difficult. Of course, the job of the welfare system is to enable people to be looked after when they cannot fulfil their financial needs and have to deal with certain health requirements.

The hon. Lady asked me if I would meet her. By all means; my door is always open. Anybody who knows me, knows that. That is the way I am. I have met numerous stakeholders in the area of mental health since I came to office.

Although we have moved to a degree, there is always more work to be done. As I said to the hon. Lady before the debate, I am somewhat restricted in what I can do in the Department today, because I have a judicial review running in this area and cannot implement some of Harrington’s third review, though I would like to, let alone do some of the work that we would like to do in respect of Litchfield. I had a meeting earlier today about how to do that.

I agree with the hon. Lady: small things can be done that would have a dramatic effect on the big picture. I am minded to look carefully at whether we can have advocates, whom I think the hon. Lady mentioned, for not only people with mental health issues, but those with learning difficulties—we do this now—and people with hidden disabilities. As she rightly said, there is often a multitude of disabilities, some obvious and others less obvious. Often, more difficulties arise in respect of the ones that we cannot see.

The hon. Lady mentioned that I have negotiated with my officials that Atos will leave the work capability assessment contract. She will be pleased to know that the new contractors will be in this year, not in 2015, and that they will initially run in parallel with Atos and the Atos software, not least because if we stopped today and brought a new contractor in tomorrow, some serious problems would come out of the other side of that. If she thinks there is confusion with the system now, she can trust me on that.

What Harrington and Litchfield touched on is the fact that the system is not broken, but can operate better. Some hon. Members fundamentally disagree with work capability assessment; I do not, although it is not perfect. The previous Administration brought WCA in. It is important that specialists consider whether an individual is capable of doing some type of work, and that they are not the person—not, say, the GP—who sees the individual on a daily basis and has a personal relationship with them.

The hon. Lady made the crucial point that clinical evidence from specialists must be there and available when decisions are made. That is where a lot of the work needs to be done. We already extend the period for people with mental health problems beyond the normal period, while we are waiting for the ESA50 to come back, because we understand the rationale for that. We also have to understand that the filling in of forms and the commentary that needs to be given to officials, whether from Atos or the new contractor, is vital. We need to get as much information as possible—not least, as the hon. Lady said, so that we do not get into an appeal and tribunal situation when that is unnecessary.

Evidence in respect of changes that I have made in the past couple of months clearly shows that fewer people are appealing their WCA than did a year ago. We will release more evidence on that. A lot of that is because we are, for want of a better phrase, getting it right and making it better. We need to do more work on hidden disabilities, and mental health is one of those.

I do not get quite the numbers at my surgery that the hon. Member for Strangford (Jim Shannon) mentioned, but people do come to see me and, I think, other hon. Members on the subject. Anyone with an ounce of compassion in them will understand the issues and concerns that these people come to them with. I stress that it is not just about ensuring that a person gets the financial benefit that they need; it is about ensuring that they get the help they need, whether from the mental health side of the health service or from clinicians, and that they get assistance to get back into the workplace.

I reiterate that I am more than happy to work with not only the hon. Lady and SAMH, but all the groups, which are working much more closely with us now. Of course, I would prefer to have the judicial review addressed and done as soon as possible, so that we can not only hear the ruling, but move on with pilots for some of the ideas in the report. I will be perfectly honest and say that I have read the report summary but not the report in its entirety—it is a detailed report—but I assure the hon. Lady that it landed on my desk almost before it was in print.

This is an important issue, and it is important that we get it right; the Government are determined to get it right. It will never be perfect, because of the issues and the complexity that we are dealing with, but as long as I am the Minister, making sure that we address the issues will be at the top of my list.

[Jim Shannon]

Will the Minister give way?

[Mike Penning]

I have sat down, so it is up to the Chair.

[Mrs Anne Main (in the Chair)]

The Minister has concluded his remarks. We will suspend until 4.30 pm. If there is a Division in the main Chamber between now and 4.30 pm, we will take 15 minutes for that Division.

16:16

Sitting suspended.

Migratory Birds (Malta)

Wednesday 7th May 2014 Westminster Hall

16:29

[Sir John Randall (Uxbridge and South Ruislip) (Con)]

It is a privilege, Mrs Main, to serve under your chairmanship. Knowing your record on these matters, I am sure you will be interested in the debate, and I am grateful to Mr Speaker for granting it. I feel privileged to be given the opportunity to voice the concerns of many thousands of people in this country and further afield about the mindless slaughter of migrant birds in Malta.

This year marks the 50th year that I have been a member of the Royal Society for the Protection of Birds. I joined as a very young boy, and throughout those years, I have been acutely aware of the existence in the Mediterranean area of a culture of killing migrant birds of all types. I regret to say that one of the worst culprits has been Malta, and as a result, I have never had the pleasure of visiting that island. That is a real pity, because I have an otherwise positive image of a courageous George Cross island that is steeped in history. The Maltese people that I have met have always been friendly and incredibly pleasant.

Like many people who have an interest in wildlife—I have to admit that in my case it is a passion—I have been riveted recently by the daily video blogs produced by the well known broadcaster Chris Packham and a dedicated team of volunteers. They were helped by a courageous group from BirdLife International and BirdLife Malta. I say courageous, because they faced personal intimidation, questioning from the Maltese authorities and even physical danger. Men with firearms are not confronted lightly.

Some of those brave Maltese who have been fighting against this illegal hunting over the years have put their lives on the line, but what has that got to do with us in the UK? Nature does not respect national boundaries, so co-ordinated international action is essential if we are to protect our wild bird species for future generations. The EU’s birds directive and habitats directive are the cornerstones of conservation action across Europe and provide a policy framework that has helped to improve the status and prospects of wild birds across Europe.

[Jim Shannon (Strangford) (DUP)]

I commend the right hon. Gentleman for bringing this important matter to Westminster Hall for discussion. It is important to get a balance, though. I know his point of view, and he referred to the conservation groups that have catalogued evidence, but some shooting organisations have evidence as well. When it comes to getting the balance and the full picture, it is important to contact the British Association for Shooting and Conservation and the Countryside Alliance. They have direct contact with those bodies in Malta.

[Sir John Randall]

One thing that I have found is that legitimate shooting interests in this country and elsewhere in Europe regard what goes on in Malta as not part of their sport. I will go on to say more on that. I am in no way anti-shooting, whether in the UK or elsewhere, if it is legitimate.

[Simon Kirby (Brighton, Kemptown) (Con)]

Does my right hon. Friend agree with many of my constituents, who do not understand why this barbaric practice is still going on in the 21st century?

[Sir John Randall]

I know that my hon. Friend and his constituents have a keen interest in this issue. He is absolutely right that there is no place for the practice in the 21st century.

[Andrew Miller (Ellesmere Port and Neston) (Lab)]

Following on from that point, does the right hon. Gentleman recognise that from 1 April this year, the penalties for illegal shooting in Malta were multiplied by 10? I welcome that. I lived in Malta and I fully understand that there is still a hunting party out there, which needs bringing to heel. Secondly, just yesterday—

[Mrs Anne Main (in the Chair)]

Order. May I ask that in a half-hour debate Members keep their comments very short?

[Andrew Miller]

I promise you, Mrs Main, that I will be very quick.

[Mrs Anne Main (in the Chair)]

Order. I call Sir John Randall.

[Sir John Randall]

I am grateful to the hon. Gentleman and pleased to hear about the increased penalties, but the point is that penalties have to be enforced. Earlier, he was telling me that the Maltese are taking action. If that is so, that is welcome news and I wait to see what happens.

[Andrew Miller]

Yesterday’s Malta Independent reported the arrest of four people in Naxxar following the shooting of a flamingo last year. That is good news.

[Sir John Randall]

That is good news. We would all welcome those arrests, which we want to see happening more often. Malta holds the only derogation for recreational spring hunting of turtle doves and quail, and we all know that that provides a smokescreen for illegal hunting. The UK Government and the European Commission must insist that Malta abides by the spirit, as well as the letter, of the EU’s birds directive and habitats directive and puts an end to spring hunting for good.

Malta sits on the central Mediterranean bird migration flyway between Europe and Africa. Every spring and autumn, large numbers of birds fly over the islands on their migration between the two continents. Many are shot in Malta. Spring hunting is significantly more damaging than autumn hunting, as it reduces the numbers of birds returning to breed. That is self-evident.

[Dr Alan Whitehead (Southampton, Test) (Lab)]

I congratulate the right hon. Gentleman on securing this debate. Is he willing to emphasise how much this is a British issue? British birds are migrating over these routes. Does he have any estimates for the effect that Maltese shooting has had on British bird numbers over the years?

[Sir John Randall]

Many of the birds are not in fact coming to Britain, although some are. For cuckoos in particular, we now know more about their migration, and we know that they are British birds. Regardless of whether the birds are British or not, they are European. On that point, I am a European.

An open season runs from 1 September to 31 January, during which 41 species of bird can be legally hunted in unlimited numbers, but the trouble is that there is a mix of legal and illegal hunting. Spring hunting is not usually legal in the European Union. Article 7.4 of the birds directive obliges member states to ban hunting of species to which hunting regulations apply during their period of reproduction or during their return to rearing grounds. Malta is the only country in the EU with a derogation from the directive. The directive states that derogations made be made

“where there is no other satisfactory solution…to permit, under strictly supervised conditions and on a selective basis, the capture, keeping or other judicious use of certain birds in small numbers.”

In 2009, no spring hunting of quail and turtle doves was permitted for the first time ever due to an injunction from the European Court of Justice, which ruled that too many birds were being killed. It followed a complaint from BirdLife Malta to the European Commission in 2005 and a petition to the Maltese Prime Minister with 115,000 signatures from RSPB members. In 2010, however, spring hunting was reopened despite an ECJ ruling that by allowing spring hunting in the 2004 to 2007 period, Malta had failed to comply with the conditions for derogation.

Hunting in Malta currently breaches many if not all of the conditions for derogation. The spring hunting derogation specifies that a maximum of 16,000 birds can be killed, but each licensed hunter is allowed to kill four birds in total of turtle dove and/or quail, so more than 40,000 turtle dove and quail could be shot by licensed hunters. Turtle doves are in serious decline in western Europe, and this hunting is taking out the remaining populations. An agreement between the new Maltese Government, elected in 2013, and the FKNK, Malta’s largest hunting organisation, allows every registered hunter to obtain a spring hunting licence, meaning that more 10,000 hunters are supposed to hunt just 16,000 birds. At the same time, the spring season has been extended.

The current derogation framework is frequently abused by the hunting community in Malta. Consecutive spring hunting reports from BirdLife Malta show that the number of birds shot is much higher than allowable bag limits set by the Maltese Government. The derogation framework allows two species to be hunted, but more than 19 species were observed to have been shot or were brought into the BirdLife Malta office by volunteers last year. The same is true this year, as we saw in the video blogs. Many of the species targeted every spring hunting season are threatened in Europe, including Montagu’s, marsh and pallid harriers, common cuckoos and nightjars. One of most heart-rending scenes in the video blogs was the euthanising of a Montagu’s harrier that had been shot.

It has become increasingly difficult to gather evidence and numbers as poachers become more sophisticated in their illegal activity, including using illegal electronic lures and even hunting birds on the ground at night. It should not be imagined that it is a fair contest of man and rifle against his quarry; this is slaughter, pure and simple. Some on the island claim that the activity is traditional. Indeed, it was, but there is no place for such traditions in the 21st century. Bear baiting and cock fighting were once traditions in this country, but I do not think that anyone is arguing for their return.

[Penny Mordaunt (Portsmouth North) (Con)]

I thank my right hon. Friend for giving way. Coming from Portsmouth, I understand well the connection that Britain has with Malta. As well as our shared naval history, we are the guardians of each other’s wildlife. In my experience, that is well understood not only by the people of Portsmouth, but also by the people of Valetta, which is why I find this lax attitude so difficult to understand.

[Sir John Randall]

I am grateful to my hon. Friend, who is absolutely right. I regret this problem with a few people in Malta, because the ties between our two countries are immense.

[Andrew George (St Ives) (LD)]

I congratulate my right hon. Friend on securing the debate and on the case he makes. In congratulating the movement in Malta and the Government’s approach, is he not shocked that Chris Packham was detained by the police for highlighting the abuses going on in the country?

[Sir John Randall]

I do not know the exact situation, but it seems on the surface that that was not the best move.

In March, 33 MEPs from 10 member states wrote to Environment Commissioner Potocnik saying that

“the Maltese government has sought to justify the derogation through inaccurate reports and unreliable and even fictional data.”

Will the Government call on Janez Potocnik, the EU Environment Commissioner, to ensure that the directive is properly enforced in Malta?

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

I congratulate my right hon. Friend on securing the debate. Does he agree that the situation smacks of the European Commission having lost the will to address the problem?

[Sir John Randall]

I am not entirely sure. All I know is that the European Commissioner’s time is running out and it is not the best time to discuss such matters, so I think that we will return to them in a couple of months.

The main law that defends our shared wildlife is the EU birds directive, but a new environmental inspections directive is also under consideration. However, we cannot be too cocky. We must get our own house in order, as the illegal persecution of birds still happens in this country, including the recent killing of some red kites in Ross-shire. We cannot lecture people unless we get our house in order—although I stress that I am not trying to lecture the Maltese people.

[Joan Walley (Stoke-on-Trent North) (Lab)]

Does the right hon. Gentleman agree that, alongside the UK Government taking the matter up with the European Commission, it is also important to hold bilateral talks with Malta to see whether some agreement can be reached?

[Sir John Randall]

I like the idea, but this is a European thing. I do not want the Maltese to think that Britain is pushing them; other European countries, such as Holland and Germany, are thinking exactly the same. It just happens that we are in the UK Parliament today.

There is considerable public support in the UK for stronger action. In 2010, 230,000 people signed a petition calling on the Government to do more to end the illegal killing of our own birds of prey. With the publication of the England biodiversity strategy, the coalition Government committed themselves making it one of their priorities.

Returning to Malta, it is important to recognise that hunting is not a national pastime in Malta and that there is a majority in Malta who want the practice to stop. BirdLife Malta seeks to use the Referenda Act 1973 to force a national referendum to ban spring hunting permanently. It has collected 45,000 signatures so far, which is some 10% of the Maltese population, and we hope for a referendum in early 2015. If anybody wants to do something constructive, there is a fund to help the referendum campaign. I am sure that it can be found online and that all donations will be gratefully received.

When discussing hunters in Malta, we are talking about a group of fewer than 10,000 people who are damaging species that are precious to the public across Europe. In recent days, a young lady called Michela Spiteri wrote the following on the Times of Malta website:

“We want to be able to enjoy the little countryside we have unrestrainedly, without being subjected to the shooting sounds and the wrath of territorial hunters who, after all, have no business telling the rest of us where to get off. And above all, we are entitled to wash our hands of and not to want anything to do with the veritable bloodbath that this cruel and illegal exemption brings about.”

That is the spirit of the youth in Malta and that is what I want to encourage today.

In all other respects, I am sure that Malta is a great place for tourism. I believe strongly, as someone who used to lead birdwatching trips around the world, that if the slaughter was stopped, Malta would rapidly become a favourite destination for birdwatchers and their families at key migration periods, which would actually extend the tourist season. Like Chris Packham, for whom I have the strongest respect, and others, I am certainly not calling for a boycott—far from it. I want the Maltese people to know that we in the UK support the majority that want the cruel practice to end. I hope that the House will join me today in condemning bird killing in Malta and that the Minister will do everything possible to help bring it to an end by raising it with his European counterparts in appropriate forums in the European Union. I have been amazed by the reaction not only from the public, but also from colleagues across the House. This is a half-hour debate that traditionally involves a Member and the Minister, yet some Members have not been able intervene. There is a positive way forward and we must keep the topic in the public mind.

16:49

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

I congratulate my right hon. Friend the Member for Uxbridge and South Ruislip (Sir John Randall) on securing the debate and on bringing the subject to the attention of the House. He has a lifelong passion for such issues, being a member of the RSPB for some 50 years, as he said. Last time I debated with him in Westminster Hall, the subject was farmland birds, so I know that he is a long-standing campaigner. He is also in tune with the mood of many in the country.

Britain has always been a pioneer of conservation, and birds have always been at the forefront of this country’s passion for wildlife. Groups such as the RSPB are among those with the largest membership in the UK. As a result, wild birds have been afforded strong levels of protection in the UK since the introduction of the Protection of Birds Act 1954—a full 25 years before the EU birds directive made the protection of wild birds, in much the same manner, an obligation on all member states. It therefore comes as no surprise to me that my right hon. Friend, along with many others, was disturbed to see recent media coverage of the annual spring hunting season in Malta.

In reacting to such reports, it is important to bear in mind the distinctions between lawful hunting activity that the EU birds directive specifically permits member states to undertake, and the illegal hunting carried out by those acting outside the law. The directive provides a strong framework for the protection of all naturally occurring wild birds throughout the EU and requires each member state to take measures to ensure the protection, management and control of birds, their eggs, nests and habitats, and to maintain populations occurring within their range at levels that correspond to their particular ecological, scientific and cultural requirements. The directive, however, also lays down rules for the exploitation of such birds through hunting activity and permits the “judicious use” of wild birds for economic and recreational purposes.

Some species may be hunted for sport or food throughout the European Union, while certain others may be hunted only within specified territories. The birds directive is clear that any hunting activity must remain compatible with maintaining the populations of the species, and it contains safeguards to ensure that. The responsibility of individual member states and of the European Commission is to ensure the correct transposition of, and compliance with, EU directives. It is, however, a well known fact that the Commission has previously expressed concerns about the hunting of migratory birds in Malta. Permitting the spring hunting of turtle doves and quail has been the subject of particular Commission scrutiny to ensure that it is compliant with the directive.

Together with other islands in the Mediterranean, such as Crete and Cyprus, the islands of Malta play a vital role for many migratory species of bird during their long flight between Africa and Europe. The EU directive recognised that it is important for the birds to receive particular protection in spring, so that they may breed and build up their populations from the low point in their natural annual cycles. Some evidence suggests, in particular for turtle doves, that the impact on populations of spring hunting can be up to eight times higher than the impact of autumn hunting.

In 2009, as a result of such concerns, the European Commission referred Malta to the European Court of Justice for permitting the hunting of turtle doves and quail during their spring migration. The Court ruled that, by permitting that activity between 2004 and 2007, the Maltese Government had failed to comply with the derogation conditions associated with hunting and, as such, had failed to fulfil their obligations under the directive. The Court, however, also recognised that Malta’s unique bio-geographical circumstances restricted hunting opportunities in autumn, and it therefore reaffirmed Malta’s right to permit limited hunting in spring through a derogation from the birds directive, subject to meeting the stringent parameters of article 9(1)(c) of that directive.

[Sir John Randall]

I apologise for stopping the Minister mid-flow. What particular bio-geographical factors make hunting more difficult in the autumn?

[George Eustice]

I am told that the doves migrate through Malta, rather than being resident there. That was a conclusion of the Court—that the situation could not be dealt with in other ways, which was why it upheld the right. That was its judgment.

In response to the 2010 judgment, the Maltese Government developed a new legal framework and introduced a number of changes to how they control the spring hunting of turtle doves and quail to ensure compliance with the directive. Measures include annual estimations of the populations of species; limits on the number of birds that may be shot during the hunt under the derogation; and an assessment of whether the populations are likely to suffer any detrimental effect.

Despite the changes, a number of organisations and individuals have continued to campaign against the spring hunting permitted by the Maltese Government. I understand the concerns expressed, but it is for the Maltese Government to investigate any alleged illegal hunting activity that might be taking place alongside their permitted hunting regime. We should also bear in mind, as a number of Members have pointed out, that the issue is an incredibly contentious one in Malta itself. It has been said that more than 10% of the population have signed a petition calling for a referendum—as my right hon. Friend pointed out, it already has up to 45,000 signatures and it is being considered.

Fortuitously, I was in Athens over the past few days, at an informal meeting of the European Council. Knowing that the debate was coming up, I had the opportunity to discuss the subject briefly with my opposite number, Roderick Galdes, on the margins of one of the meetings. In fairness, the Maltese Government believe that they have done a lot to tackle the illegal killing of doves, and they feel frustrated that that has not been recognised. He highlighted some of the steps that Malta has taken to strengthen enforcement. It now has the highest ratio of enforcement deployment possible per square kilometre of countryside anywhere in Europe. He also pointed out that Malta’s penalties and legal deterrents against bird-related crime are among the most severe in Europe. He stressed that there had been some 4,000 physical inspections. I am simply pointing out the argument made by the Maltese Government.

[Sir John Randall]

We are talking about the illegal hunting not only of turtle doves, or quail for that matter—far from it—but of other species, which is well documented. That is what does not seem to have been tackled.

[George Eustice]

Yes. I am simply reporting the argument of the Maltese Government. As I said, I took the opportunity to discuss the matter briefly with my opposite number. They feel that they are not given credit for the steps they have taken, which they argue have resulted in a very tight regime, with tough reporting requirements.

Where there is evidence to suggest that illegal hunting activity is occurring, the UK Government encourage all relevant authorities to ensure that sufficiently robust action is taken. As I have stated, compliance with the European Union directives, including any alleged failings, is a matter for the individual member states and for the European Commission. Representations have been made, for example by a number of MEPs in the European Parliament, and many organisations and members of the public may also express their concerns through their MEPs.

Finally, turning to the situation here, sadly a number of the UK’s migratory bird species have experienced population declines over recent decades. A range of factors are thought to have contributed to that trend, many of which we discussed in the previous debate on this issue, including habitat loss from historical farming intensification, poor food availability and disease.

The impact that overseas hunting may have on British populations of migratory birds is unclear at the moment. Malta’s geographic position means it is unlikely that a significant proportion of our migratory bird populations pass over it; most are thought to come through places such as Gibraltar. We therefore think that spring hunting in Malta is unlikely to be having a direct impact on populations here. However, my right hon. Friend has made the valid point that he is not taking a British but a European perspective on the issue, and it may be having an impact on populations elsewhere.

Domestically, we have implemented a range of initiatives to help improve bird populations. When I last discussed the issue with my right hon. Friend, we talked at great length about the environmental stewardship schemes and the new environmental land management schemes. Turtle doves are one of six targeted species for funding in the current regime, and we expect that the new environmental land management schemes will see further benefits for farmland birds. We have made it clear that we want to prioritise biodiversity.

We are aware that illegal hunting and killing activity is a problem for many countries that are important in the life cycle of migratory birds—that is the case with Malta. This issue therefore needs strong co-operation and enforcement activity at every level. In the UK, the joint nature conservation committee has always played a leading role in the international action plan for African and Eurasian migratory land birds. We are playing our part and continue to make the case on these issues.

I congratulate my right hon. Friend once more on securing the debate. As I said, he has long championed these issues. This is a contentious issue in Malta as well. I am not sure that a British intervention will necessarily help Malta to make up its mind, given that the issue is so contentious and so many people there have expressed clear views on it. The debate has been an interesting one that has highlighted an issue that is important to many people.

[Sir John Randall]

I believe there are three minutes left, Mrs Main—

[Mrs Anne Main (in the Chair)]

Order. I am afraid that as the Minister has concluded his remarks, the sitting stands adjourned, Sir John.

Question put and agreed to.

17:00

Sitting adjourned.

Written Statements

Wednesday 7th May 2014 Written Statements

Wednesday 7 May 2014

Green Deal (Home Improvement Fund)

Wednesday 7th May 2014 Written Statements

[The Secretary of State for Energy and Climate Change (Mr Edward Davey)]

In December, the Government announced action they were taking to reduce the impact of their policies on energy bills which included £450 million over three years for household energy efficiency. I wanted to update the House on progress. In February, we made some changes to the current green deal cashback scheme, including extending it to the end of June 2014 and uplifting some rates to boost the supply chain and help customers while we designed new schemes and consulted on our proposed changes to ECO.

In March, DECC awarded £88 million to 24 consortia in English local authorities to promote green deal on a street-by-street basis, representing a huge opportunity for local industries and the energy efficiency of those communities, including projects aimed at the private rented sector. On Thursday, I announced details of a new green deal home improvement fund. From June, householders across England and Wales will be able to get up to £7,600 back through this new scheme to stimulate warmer, greener homes while enabling them to take control of their energy bills.

The fund will help households to install energy efficiency improvements by rewarding them with money back on the cost of installing two or more of 13 measures eligible under the scheme.

Under the green deal home improvement fund, domestic energy customers can claim:

up to £1,000 for installing two measures from an approved list; and/or

up to £6,000 for installing solid wall insulation; and

up to £100 refunded for their green deal assessment.

In addition, those who have bought a property in the 12 months prior to application may qualify for up to an additional £500 if they carry out energy efficiency improvements under the scheme.

These rates are guaranteed for the first £50 million, and up to £120 million is available this financial year.

Private or social landlords can benefit from the new scheme if they undertake to improve the property and are paying the costs themselves, subject to de minimis thresholds for state aid.

We have simplified the fund’s application process for customers and opened up access to approved green deal installers as well as providers. This will expand the market for smaller businesses, while maintaining the quality of installation, and enabling them to compete for energy efficiency opportunities in new and innovative ways. It will also give more householders a broader choice in how they make and pay for energy-saving home improvements.

This is the latest in a series of measures we are taking to help families across the nation enjoy the benefits of warmer, more energy-efficient homes and lower bills to stimulate business growth and to save carbon.

G7 Energy Ministers Meeting

Wednesday 7th May 2014 Written Statements

[The Secretary of State for Energy and Climate Change (Mr Edward Davey)]

On 5 and 6 May I attended a meeting of G7 Energy Ministers, hosted by Italy in Rome, to discuss energy security. These discussions took place against the backdrop of developments in Ukraine. The G7 expressed concern about the energy security implications, as a consequence of Russia’s violation of Ukraine’s sovereignty and territorial integrity.

The UK argued that we need a more energy-secure future, meaning that no single state or supplier can use energy as a weapon. The G7 has agreed to do what is needed to achieve a systematic, enduring step change to improve energy security—not just for the nations in the G7, but for our friends and allies, with a particular focus on Ukraine and its eastern European neighbours.

The principles that were agreed to guide the G7’s work on energy security were transparent competitive energy markets, diversification of energy sources, an accelerated transition to a low-carbon economy and reduced greenhouse gas emissions, energy efficiency, investment in clean energy technologies, improved infrastructure and robust emergency response systems.

We committed to take immediate action to complement the European Commission’s work to develop energy emergency plans for winter 2014-15, to exchange best practice on energy security vulnerabilities, to provide technical assistance to Ukraine, and to ask the International Energy Agency to work in close collaboration with the European Commission to consider options that the G7 could take to improve gas security.

We also agreed that this should be the start of a process, which G7 leaders would consider when they meet in Brussels on 4 and 5 June 2014.

Foreign Affairs Council/General Affairs Council

Wednesday 7th May 2014 Written Statements

[The Minister for Europe (Mr David Lidington)]

My right hon. Friend the Secretary of State for Foreign and Commonwealth Affairs will attend the Foreign Affairs Council on 12 May, and I will attend the General Affairs Council on 13 May. The Foreign Affairs Council will be chaired by the High Representative of the European Union for Foreign Affairs and Security Policy, Baroness Ashton of Upholland, and the General Affairs Council will be chaired by the Greek presidency. The meetings will be held in Brussels.

Foreign Affairs Council (FAC)

Ukraine

Ministers will discuss Ukraine against the backdrop of a continued deterioration in the security situation in the east of the country. As the FAC takes place less than two weeks before 25 May Ukrainian presidential elections the Council is an important opportunity for the EU and member states to underline their commitment to supporting Ukraine to deliver free and fair elections in the face of great odds. The UK will emphasise the importance of the rapid establishment of a civilian common security and defence policy (CSDP) mission that we, together with Sweden and Poland, advocated at the April FAC, which is intended to address urgent, stability-related needs, including in the fields of security sector reform, support of police, and rule of law. The UK also expects the Council to reaffirm support for the organisation for security and co-operation in Europe (OSCE) special monitoring mission and to encourage all participating states to contribute to the expansion of the mission. Finally, there will be a discussion of sanctions, including the possibility of further measures in response to recent—and to deter further—Russian actions to destabilise eastern and southern Ukraine.

Middle East Peace Process

Ministers will discuss the latest developments in the middle east peace process. Conclusions should focus on urging both sides to avoid any steps which would make a return to talks more difficult and find the common ground and political strength to resume negotiations. This should include reiterating support for Secretary Kerry’s efforts, and highlighting the dividends of peace, such as the EU’s offer of special privileged partnerships. Trying to apportion blame for the breakdown in talks would be unhelpful. On the subject of the reconciliation deal, the EU should stand ready to engage with any Palestinian Government which upholds the principle of non-violence, remains committed to achieving a negotiated two-state solution, and accepts all previously accepted agreements and obligations, including recognising Israel’s legitimate right to exist.

European Neighbourhood Policy

Over lunch Ministers will discuss the future direction of the European neighbourhood policy (ENP). The UK’s view is that the implementation of the ENP could be improved, and that there is a need for a thorough review, taking account of member states’ views and looking at the long-term outcomes that the EU wants to deliver. The UK wants an ENP that is focused on the EU’s strategic goals—sustainable and long-term economic and political reform, within a strengthened democratic system, with a greater degree of differentiation between partners, and a continued emphasis on conditionality.

General Affairs Council (GAC)

The General Affairs Council on 13 May will focus on preparation for the 26 and 27 June European Council, which the Prime Minister will attend. A draft agenda for the European Council has been circulated. At this stage the European Council looks likely to cover: the future justice and home affairs programme; economic issues, including better regulation; climate and energy including a Commission report on EU energy security; and external relations issues (likely to include Ukraine). Leaders will also attend a dinner in Ypres on 26 June to commemorate the outbreak of the first world war.